Exhibit 4.1
CONFORMED COPY
CREDIT AGREEMENT
dated as of
November 14, 2002
among
ABERCROMBIE & FITCH MANAGEMENT CO.
as Borrower
ABERCROMBIE & FITCH CO.
as Guarantor
The Lenders Party Hereto
and
NATIONAL CITY BANK
as Administrative Agent and Lead Arranger
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS
Section 1.01. Defined Terms.................................................1
Section 1.02. Classification of Loans and Borrowings.......................18
Section 1.03. Terms Generally..............................................18
Section 1.04. Accounting Terms; GAAP.......................................18
ARTICLE II
THE CREDITS
Section 2.01. Commitments..................................................19
Section 2.02. Loans and Borrowings.........................................19
Section 2.03. Requests for Revolving Borrowings............................19
Section 2.04. Swingline Loans..............................................20
Section 2.05. Letters of Credit............................................21
Section 2.06. Funding of Borrowings........................................26
Section 2.07. Interest Elections...........................................26
Section 2.08. Termination and Reduction of Commitments.....................28
Section 2.09. Repayment of Loans; Evidence of Debt.........................28
Section 2.10. Prepayment of Loans..........................................29
Section 2.11. Fees.........................................................30
Section 2.12. Interest ....................................................31
Section 2.13. Alternate Rate of Interest...................................33
Section 2.14. Increased Costs..............................................33
Section 2.15. Break Funding Payments.......................................34
Section 2.16. Taxes........................................................35
Section 2.17. Payments Generally; Pro Rata Treatment; Sharing of Set-offs..36
Section 2.18. Mitigation Obligations; Replacement of Lenders...............38
Section 2.19. Increase in Revolving Credit Commitments.....................39
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.01. Organization; Powers.........................................40
Section 3.02. Authorization; Enforceability................................40
Section 3.03. Governmental Approvals; No Conflicts.........................41
Section 3.04. Financial Condition; No Material Adverse Change..............41
Section 3.05. Properties...................................................41
Section 3.06. Litigation and Environmental Matters.........................41
Section 3.07. Compliance with Laws and Agreements..........................42
Section 3.08. Investment and Holding Company Status........................42
Section 3.09. Taxes........................................................42
Section 3.10. ERISA........................................................42
Section 3.11. Disclosure...................................................42
Section 3.12. Subsidiaries.................................................43
ARTICLE IV
CONDITIONS
Section 4.01. Effective Date...............................................43
Section 4.02. Each Credit Event............................................44
ARTICLE V
AFFIRMATIVE COVENANTS
Section 5.01. Financial Statements and Other Information...................45
Section 5.02. Notices of Material Events...................................46
Section 5.03. Existence; Conduct of Business...............................46
Section 5.04. Payment of Obligations.......................................47
Section 5.05. Maintenance of Properties; Insurance.........................47
Section 5.06. Books and Records; Inspection Rights.........................47
Section 5.07. Compliance with Laws.........................................47
Section 5.08. Use of Proceeds and Letters of Credit........................47
Section 5.09. Additional Subsidiaries; Guarantee Requirement...............47
ARTICLE VI
NEGATIVE COVENANTS
Section 6.01. Indebtedness.................................................48
Section 6.02. Liens........................................................49
Section 6.03. Sale-Leaseback Transactions..................................50
Section 6.04. Fundamental Changes..........................................50
Section 6.05. Investments, Loans, Advances, Guarantees and Acquisitions....51
Section 6.06. Swap Agreements..............................................51
Section 6.07. Restricted Payments..........................................52
Section 6.08. Transactions with Affiliates.................................53
Section 6.09. Restrictive Agreements.......................................53
Section 6.10. Leverage Ratio...............................................53
Section 6.11. Coverage Ratio...............................................53
Section 6.12. Accounting Changes...........................................53
ARTICLE VII
EVENTS OF DEFAULT
ARTICLE VIII
THE ADMINISTRATIVE AGENT
ARTICLE IX
MISCELLANEOUS
Section 9.01. Notices......................................................58
Section 9.02. Waivers; Amendments..........................................59
Section 9.03. Expenses; Indemnity; Damage Waiver...........................60
Section 9.04. Successors and Assigns.......................................61
Section 9.05. Survival.....................................................64
Section 9.06. Counterparts; Integration; Effectiveness.....................64
Section 9.07. Severability.................................................65
Section 9.08. Right of Setoff..............................................65
Section 9.09. Governing Law; Submission to Jurisdiction; Venue;
Consent to Service of Process................................65
Section 9.10. WAIVER OF JURY TRIAL.........................................66
Section 9.11. Headings.....................................................66
Section 9.12. Confidentiality..............................................66
Section 9.13. Interest Rate Limitation.....................................67
SCHEDULES:
Schedule 2.01 -- Commitments
Schedule 2.05 -- Existing Letters of Credit
Schedule 3.06 -- Disclosed Matters
Schedule 3.12 -- Subsidiaries
Schedule 6.01 -- Existing Indebtedness
Schedule 6.02 -- Existing Liens
Schedule 6.09 -- Existing Restrictions
EXHIBITS:
Exhibit A - Form of Assignment and Assumption
Exhibit B - Form of Borrowing Request
Exhibit C - Form of Interest Election Request
Exhibit D - Form of Opinion of Vorys, Xxxxx, Xxxxxxx and Xxxxx, counsel to
the Borrower
Exhibit E - Guarantee Agreement
CREDIT AGREEMENT dated as of November 14,
2002, among ABERCROMBIE & FITCH MANAGEMENT CO., a
Delaware corporation, ABERCROMBIE & FITCH CO., a
Delaware corporation, the LENDERS party hereto, and
NATIONAL CITY BANK, as Administrative Agent.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. DEFINED TERMS. As used in this Agreement, the
following terms have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing,
indicates that such Loan, or the Loans comprising such Borrowing, are bearing or
are to bear interest at a rate determined by reference to the Alternate Base
Rate.
"ADDITIONAL CREDIT ASSUMPTION AGREEMENT" means an additional
credit assumption agreement, in form and substance reasonably satisfactory to
the Administrative Agent, among the Borrower, the Administrative Agent and one
or more Additional Credit Lenders.
"ADDITIONAL CREDIT COMMITMENTS" means the Commitment of any
Lender, established pursuant to Section 2.19, to make Loans to the Borrower.
"ADDITIONAL CREDIT LENDERS" means a Lender with Additional
Credit Commitments.
"ADJUSTED TOTAL DEBT" means, at any time, the sum of (a) Total
Debt plus (b) 800% of Forward Minimum Rent Commitments.
"ADMINISTRATIVE AGENT" means NCB, in its capacity as
administrative agent for the Lenders hereunder.
"ADMINISTRATIVE QUESTIONNAIRE" means an administrative
questionnaire in a form supplied by the Administrative Agent.
"AFFILIATE" means, with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by or is under common Control with the Person specified.
"ALTERNATE BASE RATE" means, for any day, a rate per annum
equal to the higher of (a) the Prime Rate in effect on such day or (b) the
Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. Any change in
the Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective from and
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including the effective date of such change in the Prime Rate or the Federal
Funds Effective Rate, respectively.
"APPLICABLE MARGIN" means, for any day, with respect to any
Eurodollar Revolving Loan, with respect to the Facility Fees payable hereunder,
or with respect to the Utilization Fees payable hereunder, as the case may be,
the applicable rate per annum set forth below under the caption "Eurodollar
Revolving Loans Margin", "Facility Fee Rate" or "Utilization Fee Rate", as the
case may be, based upon the Leverage Ratio for the most recent determination
date:
---------------------------------------------------------------------------------- --------------------------------------
LEVERAGE RATIO EURODOLLAR REVOLVING FACILITY FEE RATE UTILIZATION FEE RATE
LOANS MARGIN
---------------------------------------------------------------------------------- --------------------------------------
LEVEL I .600% .125% .125%
less than 1.25
---------------------------------------------------------------------------------- --------------------------------------
LEVEL II .650% .175% .125%
greater than or equal to 1.25 and less than 1.75
---------------------------------------------------------------------------------- --------------------------------------
LEVEL III .700% .225% .125%
greater than or equal to 1.75 and less than 2.25
---------------------------------------------------------------------------------- --------------------------------------
LEVEL IV .750% .275% .125%
greater than or equal to 2.25 and less than 2.75
---------------------------------------------------------------------------------- --------------------------------------
LEVEL V .900% .325% .250%
greater than or equal to 2.75
---------------------------------------------------------------------------------- --------------------------
For purposes of the foregoing, (i) the Leverage Ratio shall be determined as of
the end of each fiscal quarter of the Parent's fiscal year based upon the
Parent's consolidated financial statements delivered pursuant to Section 5.01(a)
or (b) and (ii) each change in the Applicable Margin resulting from a change in
the Leverage Ratio shall be effective during the period commencing on and
including the date of delivery to the Administrative Agent of such consolidated
financial statements indicating such change and ending on the date immediately
preceding the effective date of the next such change; PROVIDED that the Leverage
Ratio shall be deemed to be in Level V (A) at any time that an Event of Default
has occurred and has been continuing for 15 days and the Administrative Agent,
at the request of the Required Lenders, so notifies the Borrower or (B) subject
to the Administrative Agent's discretion, if the Parent fails to deliver the
consolidated financial statements required to be delivered by it pursuant to
Section 5.01(a) or (b), during the period from the expiration of the time for
delivery thereof until such consolidated financial statements are delivered.
"APPLICABLE PERCENTAGE" means, with respect to any Lender, the
percentage of the total Commitments represented by such Lender's Commitment. If
the Commitments have terminated or expired, the Applicable Percentages shall be
determined based upon the Commitments most recently in effect, giving effect to
any assignments.
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"Approved Fund" means any Person (other than a natural person)
that is engaged in making, purchasing, holding or investing in bank loans and
similar extensions of credit in the ordinary course of its business and that is
administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) any
entity or an Affiliate of an entity that administers or managers a Lender.
"ASSIGNMENT AND ASSUMPTION" means an assignment and assumption
entered into by a Lender and an assignee (with the consent of any party whose
consent is required by Section 9.04), and accepted by the Administrative Agent,
in the form of Exhibit A or any other form approved by the Administrative Agent.
"AVAILABILITY PERIOD" means the period from and including the
Effective Date to but excluding the earlier of the Maturity Date and the date of
termination of the Commitments.
"BOARD" means the Board of Governors of the Federal Reserve
System of the United States of America.
"BORROWER" means Abercrombie & Fitch Management Co., a
Delaware corporation.
"BORROWING" means (a) Revolving Loans of the same Type, made,
converted or continued on the same date and, in the case of Eurodollar Loans, as
to which a single Interest Period is in effect or (b) a Swingline Loan.
"BORROWING REQUEST" means a request by the Borrower for a
Revolving Borrowing in accordance with Section 2.03 and in the form of Exhibit
B.
"BUSINESS DAY" means any day that is not a Saturday, Sunday or
other day on which commercial banks in Cleveland or New York City are authorized
or required by law to remain closed; PROVIDED that, when used in connection with
a Eurodollar Loan, the term "Business Day" shall also exclude any day on which
banks are not open for dealings in dollar deposits in the London interbank
market.
"CAPITAL LEASE OBLIGATIONS" of any Person means the
obligations of such Person to pay rent or other amounts under any lease of (or
other arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP,
and the amount of such obligations shall be the capitalized amount thereof
determined in accordance with GAAP.
A "CHANGE IN CONTROL" means (a) the acquisition of ownership,
directly or indirectly, beneficially or of record, by any Person or group
(within the meaning of the Securities Exchange Act of 1934 and the rules of the
Securities and Exchange Commission thereunder as in effect on the date hereof)
of Equity Interests representing more than 33% of the aggregate ordinary voting
power represented by the issued and outstanding Equity Interests of the Parent
as of the date of such acquisition; (b) the occupation of a majority of the
seats (other than vacant seats) on the board of directors of
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the Parent by Persons who were neither (i) nominated by the board of directors
of the Parent, or a committee thereof, nor (ii) appointed by directors so
nominated; or (c) the Borrower ceases, directly or indirectly, to be a
wholly-owned Subsidiary of the Parent.
"CHANGE IN LAW" means (a) the adoption of any law, rule or
regulation after the date of this Agreement, (b) any change in any law, rule or
regulation or in the interpretation or application thereof by any Governmental
Authority after the date of this Agreement or (c) compliance by any Lender or
the Issuing Bank (or, for purposes of Section 2.14(b), by any lending office of
such Lender or by such Lender's or the Issuing Bank's holding company, if any)
with any request, guideline or directive (whether or not having the force of
law) of any Governmental Authority made or issued after the date of this
Agreement.
"CLASS", when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are
Revolving Loans or Swingline Loans.
"CODE" means the Internal Revenue Code of 1986, as amended
from time to time.
"COMMITMENT" means, with respect to each Lender, the
commitment of such Lender to make Revolving Loans and to acquire participations
in Letters of Credit and Swingline loans hereunder, expressed as an amount
representing the maximum aggregate amount of such Lender's Revolving Credit
Exposure hereunder, as such commitment may be (a) reduced from time to time
pursuant to Section 2.08, (b) increased pursuant to Section 2.19 and (c) reduced
or increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 9.04. The initial amount of each Lender's Commitment is set
forth on Schedule 2.01, or in the Additional Credit Assumption Agreement or
Assignment and Assumption pursuant to which such Lender shall have assumed its
Commitment, as applicable. The initial aggregate amount of the Lenders'
Commitments is $250,000,000.
"CONSOLIDATED EBITDAR" means, for any period, Consolidated Net
Income for such period plus, without duplication and to the extent deducted in
determining such Consolidated Net Income, the sum of Interest Expense, income
tax expense, depreciation expense, amortization expense and Minimum Rent and
minus Interest Income, all as determined in accordance with GAAP on a
consolidated basis for the Parent and the Subsidiaries.
"CONSOLIDATED NET INCOME" means, for any period, the
consolidated net income (or loss) of the Parent and the Subsidiaries for such
period (excluding extraordinary gains and losses), as determined in accordance
with GAAP on a consolidated basis.
"CONTROL" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through
5
the ability to exercise voting power, by contract or otherwise. "Controlling"
and "Controlled" have meanings correlative thereto.
"COVERAGE RATIO" means, for the Parent and the Subsidiaries on
a consolidated basis at any date, the ratio of (a) Consolidated EBITDAR for the
period of four consecutive fiscal quarters then ended to (b) the sum of (x) Net
Interest Expense for such period and (y) Minimum Rent for such period.
"DEFAULT" means any event or condition which constitutes an
Event of Default or which upon notice, lapse of time or both would, unless cured
or waived, become an Event of Default.
"DESIGNATED UNIMPROVED LOTS" means any parcel of real property
located in Franklin County, Ohio or Licking County, Ohio that has not been
developed with improvements used or useful in the Borrower's business
operations.
"DISCLOSED MATTERS" means the actions, suits and proceedings
and the environmental matters disclosed in Schedule 3.06.
"DOLLARS" or "$" refers to lawful money of the United States
of America.
"EFFECTIVE DATE" means the date on which the conditions
specified in Section 4.01 are satisfied (or waived in accordance with Section
9.02).
"ENVIRONMENTAL LAWS" means all laws, rules, regulations,
codes, ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management, release or threatened release of any Hazardous
Material or the effect of the environment on health or safety.
"ENVIRONMENTAL LIABILITY" means any liability, contingent or
otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities), of the Borrower or any Subsidiary
directly or indirectly resulting from or based upon (a) violation of any
Environmental Law, (b) the generation, use, handling, transportation, storage,
treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous
Materials, (d) the release or threatened release of any Hazardous Materials into
the environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"EQUITY INTERESTS" means shares of capital stock, partnership
interests, membership interests in a limited liability company, beneficial
interests in a trust or other equity ownership interests in a Person, and any
warrants, options or other rights entitling the holder thereof to purchase or
acquire any such equity interest.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time.
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"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) that, together with the Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA EVENT" means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder with respect to a
Plan (other than an event for which the 30-day notice period is waived); (b) the
existence with respect to any Plan of an "accumulated funding deficiency" (as
defined in Section 412 of the Code or Section 302 of ERISA), whether or not
waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d)
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate
from the PBGC or a plan administrator of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f)
the incurrence by the Borrower or any of its ERISA Affiliates of any liability
with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Borrower or any
ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability
or a determination that a Multiemployer Plan is, or is expected to be, insolvent
or in reorganization, within the meaning of Title IV of ERISA.
"EURODOLLAR", when used in reference to any Loan or Borrowing,
indicates that such Loan, or the Loans comprising such Borrowing, are bearing or
are to bear interest at a rate determined by reference to the LIBO Rate.
"EVENT OF DEFAULT" has the meaning assigned to such term in
Article VII.
"EXCLUDED TAXES" means, with respect to the Administrative
Agent, any Lender, the Issuing Bank or any other recipient of any payment to be
made by or on account of any obligation of the Borrower hereunder, (a) income or
franchise taxes imposed on (or measured by) its net income by the United States
of America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which the Borrower is located and (c) in the case
of a Foreign Lender (other than an assignee pursuant to a request by the
Borrower under Section 2.18(b)), any withholding tax that is imposed on amounts
payable to such Foreign Lender and which tax is in effect at the time such
Foreign Lender becomes a party to this Agreement (or designates a new lending
office) or is attributable to such Foreign Lender's failure to comply with
Section 2.16(e), except to the extent that such Foreign Lender (or its assignor,
if any) was entitled, at the time of designation of a new lending office (or
assignment), to receive additional amounts from the Borrower with respect to
such withholding tax pursuant to Section 2.16(a).
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"EXISTING CREDIT AGREEMENT" means the credit agreement dated
as of April 30, 1998, as amended, among the Borrower, the Parent, JPMorgan Chase
Bank, as administrative agent, and the lenders party thereto.
"EXISTING LETTER OF CREDIT AGREEMENTS" means both (i) the
Continuing Agreement for Issuance of Unsecured Commercial Letters of Credit
dated as of July 7, 1998, between Huntington National Bank and Abercrombie &
Fitch Stores, Inc. (n/k/a Abercrombie & Fitch Management Co.) and (ii) the
Assumption of and Amendment to Continuing Agreement for Issuance of Commercial
Letters of Credit dated as of October 11, 2000.
"FACILITY FEE" has the meaning set forth in Section 2.11(a).
"FEDERAL FUNDS EFFECTIVE RATE" means, for any day, the
weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average
(rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for
such day for such transactions received by the Administrative Agent from three
Federal funds brokers of recognized standing selected by it.
"FINANCIAL OFFICER" means the chief operating officer, chief
financial officer, principal accounting officer, vice president-finance,
treasurer or controller of the Borrower.
"FOREIGN LENDER" means any Lender or successor Issuing Bank
that is organized under the laws of a jurisdiction other than that in which the
Borrower is located. For purposes of this definition, the United States of
America, each State thereof and the District of Columbia shall be deemed to
constitute a single jurisdiction.
"FORWARD MINIMUM RENT COMMITMENTS" means minimum rent
commitments (less related sublease income) under noncancelable leases, including
under any such leases of any Person other than the Parent, the Borrower or a
Subsidiary to the extent, directly or indirectly guaranteed, endorsed or assumed
by the Parent, the Borrower or any Subsidiary or in respect of which the Parent,
the Borrower or any Subsidiary is contingently or otherwise liable, for the
fiscal year following the Parent's most recently ended fiscal year, as reported
or to be reported in the Parent's annual report filed on Form 10-K with the
Securities and Exchange Commission for the Parent's most recently ended fiscal
year.
"GAAP" means generally accepted accounting principles in the
United States of America.
"GOVERNMENTAL AUTHORITY" means the government of the United
States of America, any other nation or any political subdivision thereof,
whether state or local, and any agency, authority, instrumentality, regulatory
body, court, central bank or other entity
8
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
"GUARANTEE" of or by any Person (the "guarantor") means any
obligation, contingent or otherwise, of the guarantor guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation of any
other Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of the guarantor, direct or indirect,
(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof, (c)
to maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation; PROVIDED, that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business.
"GUARANTEE AGREEMENT" means a Guarantee Agreement in
substantially the form of Exhibit E hereto among the Guarantors and the
Administrative Agent acting on behalf of the Lenders, as the same may be
amended, modified or supplemented from time to time in accordance with the
provisions hereof.
"GUARANTORS" means the Parent and the US Subsidiaries that
become party to the Guarantee Agreement pursuant to Sections 4.01(f) and 5.09 or
otherwise.
"HAZARDOUS MATERIALS" means all explosive or radioactive
substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, friable asbestos or
materials containing friable asbestos, polychlorinated biphenyls, radon gas,
infectious or medical wastes and all other substances or wastes of any nature
regulated pursuant to any Environmental Law.
"INDEBTEDNESS" of any Person means, without duplication, (a)
all obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such Person under conditional sale or other title retention
agreements relating to property acquired by such Person, (d) all obligations of
such Person in respect of the deferred purchase price of property or services
(excluding current accounts payable incurred in the ordinary course of
business), (e) all Indebtedness of others secured by (or for which the holder of
such Indebtedness has an existing right, contingent or otherwise, to be secured
by) any Lien on property owned or acquired by such Person, whether or not the
Indebtedness secured thereby has been assumed, (f) all Guarantees by such Person
of Indebtedness of others, (g) all Capital Lease Obligations of such Person, (h)
all obligations, contingent or otherwise, of such Person as an account party in
respect of letters of credit and letters of guaranty and (i) all obligations,
contingent or otherwise, of such Person in respect of bankers' acceptances. The
Indebtedness of any Person shall include the Indebtedness of any other entity
(including any partnership in which such
9
Person is a general partner) to the extent such Person is liable therefor as a
result of such Person's ownership interest in or other relationship with such
entity, except to the extent the terms of such Indebtedness provide that such
Person is not liable therefor.
"INDEMNIFIED TAXES" means Taxes other than Excluded Taxes.
"INTEREST EXPENSE" means, for any period, the gross interest
expense of the Parent and the Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP.
"INTEREST ELECTION REQUEST" means a request by the Borrower to
convert or continue a Revolving Borrowing in accordance with Section 2.07 and in
the form of Exhibit C.
"INTEREST INCOME" means, for any period, interest income of
the Parent and the Subsidiaries for such period determined on a consolidated
basis in accordance with GAAP.
"INTEREST PAYMENT DATE" means (a) with respect to any ABR Loan
(other than a Swingline Loan), the last Business Day of each January, April,
July and October, (b) with respect to any Eurodollar Loan, the last Business Day
of the Interest Period applicable to the Borrowing of which such Loan is a part
and, in the case of a Eurodollar Borrowing with an Interest Period of more than
three months' duration, each day prior to the last day of such Interest Period
that occurs at intervals of three months' duration after the first day of such
Interest Period and (c) with respect to any Swingline Loan, the day that such
Loan is required to be repaid.
"INTEREST PERIOD" means (a) with respect to any Eurodollar
Borrowing, the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the calendar month that is 1, 2, 3 or 6 months
thereafter as the Borrower may elect; PROVIDED, that (i) if any Interest Period
would end on a day other than a Business Day, such Interest Period shall be
extended to the next succeeding Business Day unless, in the case of a Eurodollar
Borrowing only, such next succeeding Business Day would fall in the next
calendar month, in which case such Interest Period shall end on the next
preceding Business Day and (ii) any Interest Period pertaining to a Eurodollar
Borrowing that commences on the last Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the last calendar
month of such Interest Period) shall end on the last Business Day of the last
calendar month of such Interest Period. For purposes hereof, the date of a
Borrowing initially shall be the date on which such Borrowing is made and, in
the case of a Revolving Borrowing, thereafter shall be the effective date of the
most recent conversion or continuation of such Borrowing.
"ISSUING BANK" means The Huntington National Bank and any
Lender selected by the Borrower to issue Letters of Credit hereunder as provided
in Section 2.05(i), in such capacity. The Issuing Bank may, in its discretion,
arrange for one or more Letters of Credit to be issued by Affiliates of the
Issuing Bank, in which case the
10
term "Issuing Bank" shall include any such Affiliate with respect to Letters of
Credit issued by such Affiliate.
"LC DISBURSEMENT" means a payment made by the Issuing Bank
pursuant to a Letter of Credit.
"LC EXPOSURE" means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding Letters of Credit at such time plus (b) the
aggregate amount of all LC Disbursements that have not yet been reimbursed by or
on behalf of the Borrower at such time. The LC Exposure of any Lender at any
time shall be its Applicable Percentage of the total LC Exposure at such time.
"LENDERS" means the Persons listed on Schedule 2.01 and any
other Person that shall have become a party hereto pursuant to an Additional
Credit Assumption Agreement or an Assignment and Assumption, other than any such
Person that ceases to be a party hereto pursuant to an Assignment and
Assumption. Unless the context otherwise requires, the term "Lenders" includes
the Swingline Lender.
"LETTERS OF CREDIT" means Trade Letters of Credit and Standby
Letters of Credit, including those existing letters of credit issued under the
Existing Letter of Credit Agreements and set forth on Schedule 2.05 hereto.
"LEVERAGE RATIO" means, for the Parent and the Subsidiaries on
a consolidated basis at any date, the ratio of (a) Adjusted Total Debt at the
end of the most recently ended fiscal quarter to (b) Consolidated EBITDAR for
the period of four consecutive fiscal quarters then ended.
"LIBO RATE" means, with respect to any Eurodollar Borrowing
for any Interest Period, the rate appearing on Moneyline Telerate screen page
3750 (or on any successor or substitute page of such service, or any successor
to or substitute for such service, providing rate quotations comparable to those
currently provided on such page of such service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of
interest rates applicable to dollar deposits in the London interbank market) at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period, as the rate for dollar deposits with a
maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO Rate" with respect to such
Eurodollar Borrowing for such Interest Period shall be the average (rounded
upward to the nearest whole multiple of 1/16 of 1% per annum) rate at which
dollar deposits of $5,000,000 and for a maturity comparable to such Interest
Period are offered by the principal London office of the Reference Banks in the
London interbank market at approximately 11:00 a.m., London time, two Business
Days prior to the commencement of such Interest Period.
"LIEN" means, with respect to any asset, (a) any mortgage,
deed of trust, lien, pledge, hypothecation, encumbrance, charge or security
interest in, on or of such asset, (b) the interest of a vendor or a lessor under
any conditional sale agreement, capital lease or title retention agreement (or
any financing lease having substantially the same
11
economic effect as any of the foregoing) relating to such asset and (c) in the
case of securities, any purchase option, call or similar right of a third party
with respect to such securities.
"LOAN DOCUMENTS" means this Agreement, any promissory notes
issued pursuant to Section 2.09(e) hereunder and the Guarantee Agreement.
"LOAN PARTIES" means the Borrower and the Guarantors.
"LOANS" means the loans made by the Lenders to the Borrower
pursuant to this Agreement.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on
(a) the business, assets, results of operations or financial condition of the
Parent and the Subsidiaries taken as a whole, (b) the ability of the Parent or
the Borrower to perform any of its obligations under this Agreement or (c) the
rights of or benefits available to the Lenders under this Agreement or the
Guarantee Agreement.
"MATERIAL INDEBTEDNESS" means Indebtedness (other than the
Loans and Letters of Credit), or obligations in respect of one or more Swap
Agreements, of any one or more of the Parent, the Borrower and the Subsidiaries
in an aggregate principal amount exceeding $10,000,000. For purposes of
determining Material Indebtedness, the "principal amount" of the obligations of
the Parent, the Borrower or any Subsidiary in respect of any Swap Agreement at
any time shall be the maximum aggregate amount (giving effect to any netting
agreements) that the Parent, the Borrower or such Subsidiary would be required
to pay if such Swap Agreement were terminated at such time.
"MATERIAL SUBSIDIARY" means (a) the Borrower, (b) any
Subsidiary owning an Equity Interest in a Material Subsidiary and (c) any other
Subsidiary (i) the consolidated revenues of which for the most recent fiscal
year of the Parent for which audited financial statements have been delivered
pursuant to Section 5.01 were greater than 5% of the Parent's consolidated
revenues for such fiscal year or (ii) the consolidated tangible assets of which
as of the end of such fiscal year were greater than 5% of the Parent's
consolidated tangible assets as of such date or (iii) the EBITDAR of which as of
the end of such fiscal year was greater than 5% of Consolidated EBITDAR for such
fiscal year.
"MATURITY DATE" means November 14, 2005.
"MINIMUM RENT" means total rent expense less contingent store
rent.
"MULTIEMPLOYER PLAN" means a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"NCB" means National City Bank, a national banking
association, together with its successors and assigns.
12
"NET INTEREST EXPENSE" means the greater of (a) zero and (b)
Interest Expense less Interest Income.
"NET PROCEEDS" means, with respect to any Prepayment Event (a)
the cash proceeds received in respect of such event including (i) any cash
received in respect of any non-cash proceeds, but only as and when received,
(ii) in the case of a casualty, insurance proceeds, and (iii) in the case of a
condemnation or similar event, condemnation awards and similar payments, net of
(b) the sum of (i) all reasonable fees and out-of-pocket expenses paid by the
Parent, the Borrower and the Subsidiaries to third parties (other than
Affiliates) in connection with such event, (ii) in the case of a sale, transfer
or other disposition of an asset (including pursuant to a sale and leaseback
transaction or a casualty or a condemnation or similar proceeding), the amount
of all payments required to be made by the Parent, the Borrower and the
Subsidiaries as a result of such event to repay Indebtedness (other than Loans)
secured by such asset or otherwise subject to mandatory prepayment as a result
of such event, and (iii) the amount of all taxes paid (or reasonably estimated
to be payable) by the Parent, the Borrower and the Subsidiaries, and the amount
of any reserves established by the Parent, the Borrower and the Subsidiaries to
fund contingent liabilities reasonably estimated to be payable, in each case
during the year that such event occurred or the next succeeding year and that
are directly attributable to such event (as determined reasonably and in good
faith by the chief financial officer of the Parent or the Borrower).
"OTHER TAXES" means any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement.
"PARENT" means Abercrombie & Fitch Co., a Delaware
corporation.
"PARTICIPANT" has the meaning set forth in Section 9.04.
"PBGC" means the Pension Benefit Guaranty Corporation referred
to and defined in ERISA and any successor entity performing similar functions.
"PERMITTED ENCUMBRANCES" means:
(a) Liens imposed by law for taxes that are not yet due or are
being contested in compliance with Section 5.04;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's and other like Liens imposed by law, arising in the
ordinary course of business and securing obligations that are not
overdue by more than 30 days or are being contested in compliance with
Section 5.04;
(c) pledges and deposits made in the ordinary course of
business in compliance with workers' compensation, unemployment
insurance and other social security laws or regulations;
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(d) deposits to secure the performance of bids, trade
contracts, leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature, in each case
in the ordinary course of business;
(e) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary
course of business that do not secure any monetary obligations and do
not materially detract from the value of the affected property or
interfere with the ordinary conduct of business of the Borrower or any
Subsidiary;
(f) interests of a lessor or lessee arising under a lease; and
(g) Liens resulting from judgments provided such judgments in
the aggregate do not constitute an Event of Default under clause (k) of
Article VII;
PROVIDED that the term "Permitted Encumbrances" shall not
include any Lien securing Indebtedness.
"PERMITTED INVESTMENTS" means:
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States
of America (or by any agency thereof to the extent such obligations are
backed by the full faith and credit of the United States of America),
in each case maturing within one year from the date of acquisition
thereof;
(b) investments in commercial paper maturing within 270 days
from the date of acquisition thereof and rated, at such date of
acquisition, at least A2 by S&P or P2 by Xxxxx'x;
(c) investments in certificates of deposit, banker's
acceptances and time deposits maturing within 180 days from the date of
acquisition thereof issued or guaranteed by or placed with, and money
market deposit accounts issued or offered by (i) any domestic office of
any commercial bank organized under the laws of the United States of
America or any State thereof which has a combined capital and surplus
and undivided profits of not less than $100,000,000, (ii) any Lender or
(iii) any foreign banking institution or foreign branch of a domestic
commercial bank the long-term debt of which (or of its holding company
in the case of a domestic bank) is rated at least A- by S&P and A3 by
Xxxxx'x;
(d) fully collateralized repurchase agreements with a term of
not more than 90 days for securities described in clause (a) above and
entered into with a financial institution satisfying the criteria
described in clause (c) above;
(e) short-term tax-exempt securities rated not lower than BBB
by either Xxxxx'x or S&P with provisions for liquidity or maturity
accommodations of two years or less; and
14
(f) any money market or similar fund not less than 90% of the
assets of which are comprised of any of the items specified in clauses
(a) through (e) above and as to which withdrawals are permitted at
least every 90 days.
"PERSON" means any natural person, corporation, limited
liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.
"PLAN" means any employee pension benefit plan (other than a
Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section
412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or
any ERISA Affiliate is (or, if such plan were terminated, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"PREPAYMENT EVENT" means:
(a) any sale, transfer or other disposition (including
pursuant to a sale and leaseback transaction or asset securitization)
of any property or asset of the Parent, the Borrower or any Subsidiary,
other than (i) dispositions made in the ordinary course of business,
(ii) dispositions of Designated Unimproved Lots and (iii) dispositions
that result in Net Proceeds not exceeding $10,000,000 in the aggregate
during any fiscal year of the Parent; or
(b) any casualty or other insured damage to, or any taking
under power of eminent domain or by condemnation or similar proceeding
of, any property or asset of the Borrower, the Parent or any
Subsidiary, other than any such event resulting in Net Proceeds not
exceeding $10,000,000 in the aggregate during any fiscal year of the
Parent, but only to the extent that the Net Proceeds therefrom have not
been applied to repair, restore or replace such property or asset
within 12 months after such event.
"PRIME RATE" means the rate of interest per annum publicly
announced from time to time by NCB as its prime rate in effect at its principal
office in Cleveland, Ohio; each change in the Prime Rate shall be effective from
and including the date such change is publicly announced as being effective.
"REINVESTMENT ASSETS" means real property, equipment or other
tangible assets to be used in the business of the Parent, the Borrower or the
Subsidiaries.
"REGISTER" has the meaning set forth in Section 9.04.
"REINVESTMENT DEFERRED AMOUNT" means with respect to any
Reinvestment Event, the aggregate Net Proceeds received by the Parent, the
Borrower or any Subsidiary in connection therewith that, as the result of the
delivery of a Reinvestment Notice, are not applied to reduce the total
Commitments pursuant to Section 2.08(c).
15
"REINVESTMENT EVENT" means any Prepayment Event in respect of
which the Borrower has delivered a Reinvestment Notice.
"REINVESTMENT NOTICE" means a written notice executed by a
Financial Officer stating that no Event of Default has occurred and is
continuing and that the Parent, the Borrower or a Subsidiary intends and expects
to use all or a specified portion of the Net Proceeds of a Prepayment Event to
acquire Reinvestment Assets.
"REINVESTMENT PREPAYMENT AMOUNT" means with respect to any
Reinvestment Event, the (x) Reinvestment Deferred Amount relating thereto LESS
(y) any amount thereof expended prior to the relevant Reinvestment Prepayment
Date (i) to acquire Reinvestment Assets or (ii) to pay expenses relating to any
proposed acquisition of Reinvestment Assets.
"REINVESTMENT PREPAYMENT DATE" shall mean with respect to any
Reinvestment Event, the earlier of (a) the date occurring twelve months after
such Reinvestment Event and (b) the date on which the Parent, the Borrower or
any Subsidiary shall have notified the Administrative Agent that it has
determined not to, or shall have otherwise ceased to, acquire Reinvestment
Assets with all or any portion of the relevant Reinvestment Deferred Amount.
"RELATED PARTIES" means, with respect to any specified Person,
such Person's Affiliates and the respective directors, officers, employees,
agents and advisors of such Person and such Person's Affiliates.
"REFERENCE BANKS" means (i) NCB and (ii) any other Lender or
Lenders selected as a Reference Bank by the Administrative Agent and the
Required Lenders; PROVIDED that if any of such Reference Banks is no longer a
Lender, such other Lender or Lenders as may be selected by the Administrative
Agent acting on instructions from the Required Lenders.
"REQUIRED LENDERS" means, at any time, Lenders having
Revolving Credit Exposures and unused Commitments representing 51% or more of
the sum of the total Revolving Credit Exposures and unused Commitments at such
time.
"RESTRICTED PAYMENT" means (a) any dividend or other
distribution (whether in cash, securities or other property) with respect to any
Equity Interest of the Parent, the Borrower or any Subsidiary, or (b) any
payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of (i) the purchase, redemption, retirement,
acquisition, cancelation or termination of any Equity Interest of the Parent or
the Borrower or (ii) any option, warrant or other right to acquire any such
Equity Interest of the Parent or the Borrower.
"REVOLVING BORROWING" means a Borrowing comprised of Revolving
Loans.
16
"REVOLVING CREDIT EXPOSURE" means, with respect to any Lender
at any time, the sum of the outstanding principal amount of such Lender's
Revolving Loans and its LC Exposure and Swingline Exposure at such time.
"REVOLVING LOAN" means a Loan made pursuant to Section 2.03.
"STANDBY LETTER OF CREDIT" means each irrevocable letter of
credit issued by an Issuing Bank pursuant to Section 2.05 relating to
obligations (including performance obligations) of the Borrower, any Subsidiary
or any Loan Party incurred pursuant to contracts to which the Borrower, any
Subsidiary or any Loan Party is or proposes to become a party in the ordinary
course of business.
"STANDBY LC DISBURSEMENT" means a payment made by the Issuing
Bank pursuant to a Standby Letter of Credit.
"STANDBY LC EXPOSURE" means, at any time, the sum of (a) the
aggregate undrawn amount of all outstanding Standby Letters of Credit at such
time plus (b) the aggregate amount of all Standby LC Disbursements that have not
yet been reimbursed by or on behalf of the Borrower at such time. The Standby LC
Exposure of any Lender at any time shall be its Applicable Percentage of the
total Standby LC Exposure at such time.
"STATUTORY RESERVE RATE" means a fraction (expressed as a
decimal), the numerator of which is the number one and the denominator of which
is the number one minus the aggregate of the maximum reserve percentages
(including any marginal, special, emergency or supplemental reserves) expressed
as a decimal established by the Board to which the Administrative Agent is
subject for eurocurrency funding (currently referred to as "Eurocurrency
Liabilities" in Regulation D of the Board). Such reserve percentages shall
include those imposed pursuant to such Regulation D. Eurodollar Loans shall be
deemed to constitute eurocurrency funding and to be subject to such reserve
requirements without benefit of or credit for proration, exemptions or offsets
that may be available from time to time to any Lender under such Regulation D or
any comparable regulation. The Statutory Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage.
"SUBSIDIARY" means, with respect to any Person (the "parent")
at any date, any corporation, limited liability company, partnership,
association or other entity the accounts of which would be consolidated with
those of the parent in the parent's consolidated financial statements if such
financial statements were prepared in accordance with GAAP as of such date, as
well as any other corporation, limited liability company, partnership,
association or other entity (a) of which securities or other ownership interests
representing more than 50% of the equity or more than 50% of the ordinary voting
power or, in the case of a partnership, more than 50% of the general partnership
interests are, as of such date, owned, controlled or held, or (b) that is, as of
such date, otherwise Controlled, by the parent or one or more subsidiaries of
the parent or by the parent and one or more subsidiaries of the parent.
17
"SUBSIDIARY" means any subsidiary of the Parent or the
Borrower.
"SWAP AGREEMENT" means any agreement with respect to any swap,
forward, future or derivative transaction or option or similar agreement
involving, or settled by reference to, one or more rates, currencies,
commodities, equity or debt instruments or securities, or economic, financial or
pricing indices or measures of economic, financial or pricing risk or value or
any similar transaction or any combination of these transactions; PROVIDED that
no phantom stock or similar plan providing for payments only on account of
services provided by current or former directors, officers, employees or
consultants of the Parent, the Borrower or the Subsidiaries shall be a Swap
Agreement.
"SWINGLINE EXPOSURE" means, at any time, the aggregate
principal amount of all Swingline Loans outstanding at such time. The Swingline
Exposure of any Lender at any time shall be its Applicable Percentage of the
total Swingline Exposure at such time.
"SWINGLINE LENDER" means NCB, in its capacity as lender of
Swingline Loans hereunder.
"SWINGLINE LOAN" means a Loan made pursuant to Section 2.04.
"TAXES" means any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"TOTAL DEBT" means, at any date, the consolidated total
Indebtedness of the Parent and the Subsidiaries as of such date, as determined
in accordance with GAAP (excluding from Indebtedness all obligations, contingent
or otherwise, of the Parent and any Subsidiary as an account party in respect of
Trade Letters of Credit).
"TRADE LETTER OF CREDIT" means each commercial documentary
letter of credit issued by an Issuing Bank pursuant to Section 2.05 for the
purchase of goods in the ordinary course of business.
"TRANSACTIONS" means the execution, delivery and performance
by the Borrower and the Parent of this Agreement and by the Guarantors of the
Guarantee Agreement, the borrowing of Loans, the use of the proceeds thereof and
the issuance of Letters of Credit hereunder.
"TYPE", when used in reference to any Loan or Borrowing,
refers to whether the rate of interest on such Loan, or on the Loans comprising
such Borrowing, is determined by reference to the LIBO Rate or the Alternate
Base Rate or.
"US SUBSIDIARY" means any Subsidiary that is organized under
the laws of the United States or any state or other political subdivision,
territory or possession thereof.
"UTILIZATION FEE" has the meaning set forth in Section
2.11(d).
18
"WITHDRAWAL LIABILITY" means liability to a Multiemployer Plan
as a result of a complete or partial withdrawal from such Multiemployer Plan, as
such terms are defined in Part I of Subtitle E of Title IV of ERISA.
Section 1.02. CLASSIFICATION OF LOANS AND BORROWINGS. For
purposes of this Agreement, Loans may be classified and referred to by Class
(e.g., a "Revolving Loan") or by Type (e.g., a "Eurodollar Loan") or by Class
and Type (e.g., a "Eurodollar Revolving Loan"). Borrowings also may be
classified and referred to by Class (e.g., a "Revolving Borrowing") or by Type
(e.g., a "Eurodollar Borrowing") or by Class and Type (e.g., a "Eurodollar
Revolving Borrowing").
Section 1.03. TERMS GENERALLY. The definitions of terms herein
shall apply equally to the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
The word "will" shall be construed to have the same meaning and effect as the
word "shall". Unless the context requires otherwise (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such
Person's successors and assigns, (c) the words "herein", "hereof" and
"hereunder", and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement and (e) the words "asset" and "property" shall be construed to
have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights.
Section 1.04. ACCOUNTING TERMS; GAAP. Except as otherwise
expressly provided herein, all terms of an accounting or financial nature shall
be construed in accordance with GAAP, as in effect from time to time; PROVIDED
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.
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ARTICLE II
THE CREDITS
Section 2.01. COMMITMENTS. Subject to the terms and conditions
set forth herein, each Lender agrees to make Revolving Loans to the Borrower
from time to time during the Availability Period in an aggregate principal
amount that will not result in (a) such Lender's Revolving Credit Exposure
exceeding such Lender's Commitment or (b) total Revolving Credit Exposures
exceeding the total Commitments. Within the foregoing limits and subject to the
terms and conditions set forth herein, the Borrower may borrow, prepay and
reborrow Revolving Loans.
Section 2.02. LOANS AND BORROWINGS. (a) Each Revolving Loan
shall be made as part of a Borrowing consisting of Revolving Loans made by the
Lenders ratably in accordance with their respective Commitments. The failure of
any Lender to make any Loan required to be made by it shall not relieve any
other Lender of its obligations hereunder; PROVIDED that the Commitments of the
Lenders are several and no Lender shall be responsible for any other Lender's
failure to make Loans as required.
(b) Subject to Section 2.13, each Revolving Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request
in accordance herewith. Each Swingline Loan shall be an ABR Loan. Each Lender at
its option may make any Eurodollar Loan by causing any domestic or foreign
branch or Affiliate of such Lender to make such Loan; PROVIDED that any exercise
of such option shall not affect the obligation of the Borrower to repay such
Loan in accordance with the terms of this Agreement.
(c) At the commencement of each Interest Period for any
Eurodollar Revolving Borrowing, such Borrowing shall be in an aggregate amount
that is an integral multiple of $500,000 and not less than $2,500,000. At the
time that each ABR Revolving Borrowing is made, such Borrowing shall be in an
aggregate amount that is an integral multiple of $100,000 and not less than
$1,000,000; PROVIDED that (i) a Eurodollar Revolving Borrowing in an aggregate
amount not less than $2,500,000 and (ii) any ABR Revolving Borrowing, may be in
an aggregate amount that is equal to the entire unused balance of the total
Commitments or that is required to finance the reimbursement of an LC
Disbursement as contemplated by Section 2.05(e). Each Swingline Loan shall be in
an amount that is an integral multiple of $250,000 and not less than $1,000,000.
Borrowings of more than one Type and Class may be outstanding at the same time;
PROVIDED that there shall not at any time be more than a total of 10 Eurodollar
Revolving Borrowings outstanding.
(d) Notwithstanding any other provision of this Agreement, the
Borrower shall not be entitled to request, or to elect to convert or continue,
any Borrowing if the Interest Period requested with respect thereto would end
after the Maturity Date.
Section 2.03. REQUESTS FOR REVOLVING BORROWINGS. To request a
Revolving Borrowing, the Borrower shall notify the Administrative Agent of such
20
request by telephone (a) in the case of a Eurodollar Borrowing, not later than
11:00 a.m., Cleveland time, three Business Days before the date of the proposed
Borrowing, or (b) in the case of an ABR Borrowing, not later than 10:30 a.m.,
Cleveland time, on the date of the proposed Borrowing. Each such telephonic
Borrowing Request shall be irrevocable and shall be confirmed promptly by hand
delivery or telecopy to the Administrative Agent of a written Borrowing Request
in a form approved by the Administrative Agent and signed by the Borrower. Each
such telephonic and written Borrowing Request shall specify the following
information in compliance with Section 2.02:
(i) the aggregate amount of the requested Borrowing;
(ii) the date of such Borrowing, which shall be a Business
Day;
(iii) whether such Borrowing is to be an ABR Borrowing or a
Eurodollar Borrowing;
(iv) in the case of a Eurodollar Borrowing, the initial
Interest Period to be applicable thereto, which shall be a period
contemplated by the definition of the term "Interest Period"; and
(v) the location and number of the Borrower's account to which
funds are to be disbursed, which shall comply with the requirements of
Section 2.06.
If no election as to the Type of Revolving Borrowing is
specified, then the requested Revolving Borrowing shall be an ABR Borrowing. If
no Interest Period is specified with respect to any requested Eurodollar
Revolving Borrowing, then the Borrower shall be deemed to have selected an
Interest Period of one month's duration. Promptly following receipt of a
Borrowing Request in accordance with this Section, the Administrative Agent
shall advise each Lender of the details thereof and of the amount of such
Lender's Loan to be made as part of the requested Borrowing.
Section 2.04. SWINGLINE LOANS. (a) Subject to the terms and
conditions set forth herein, the Swingline Lender agrees to make Swingline Loans
to the Borrower from time to time during the Availability Period, in an
aggregate principal amount at any time outstanding that will not result in (i)
the aggregate principal amount of outstanding Swingline Loans exceeding
$20,000,000 or (ii) the total Revolving Credit Exposure exceeding the total
Commitments; PROVIDED that the Swingline Lender shall not be required to make a
Swingline Loan to refinance an outstanding Swingline Loan. Within the foregoing
limits and subject to the terms and conditions set forth herein, the Borrower
may borrow, prepay and reborrow Swingline Loans.
(b) To request a Swingline Loan, the Borrower shall notify the
Administrative Agent of such request by telephone (confirmed by telecopy), not
later than 12:00 noon, Cleveland time, on the day of a proposed Swingline Loan.
Each such notice shall be irrevocable and shall specify the requested date
(which shall be a Business Day) and amount of the requested Swingline Loan. The
Administrative Agent will promptly advise the Swingline Lender of any such
notice received from the Borrower.
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The Swingline Lender shall make each Swingline Loan available to the Borrower by
means of a credit to a deposit account designated by the Borrower and maintained
with a Lender (or, in the case of a Swingline Loan made to finance the
reimbursement of an LC Disbursement as provided in Section 2.05(e), by
remittance to the Issuing Bank) by 2:30 p.m., Cleveland time, on the requested
date of such Swingline Loan.
(c) The Swingline Lender may by written notice given to the
Administrative Agent not later than 10:00 a.m., Cleveland time, on any Business
Day require the Lenders to acquire participations on such Business Day in all or
a portion of the Swingline Loans outstanding. Such notice shall specify the
aggregate amount of Swingline Loans in which Lenders will participate. Promptly
upon receipt of such notice, the Administrative Agent will give notice thereof
to each Lender, specifying in such notice such Lender's Applicable Percentage of
such Swingline Loan or Loans. Each Lender hereby absolutely and unconditionally
agrees, upon receipt of notice as provided above, to pay to the Administrative
Agent, for the account of the Swingline Lender, such Lender's Applicable
Percentage of such Swingline Loan or Loans. Each Lender acknowledges and agrees
that its obligation to acquire participations in Swingline Loans pursuant to
this paragraph is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including the occurrence and continuance of a Default
or reduction or termination of the Commitments, and that each such payment shall
be made without any offset, abatement, withholding or reduction whatsoever. Each
Lender shall comply with its obligation under this paragraph by wire transfer of
immediately available funds, in the same manner as provided in Section 2.06 with
respect to Loans made by such Lender (and Section 2.06 shall apply, mutatis
mutandis, to the payment obligations of the Lenders), and the Administrative
Agent shall promptly pay to the Swingline Lender the amounts so received by it
from the Lenders. The Administrative Agent shall notify the Borrower of any
participations in any Swingline Loan acquired pursuant to this paragraph, and
thereafter payments in respect of such Swingline Loan shall be made to the
Administrative Agent and not to the Swingline Lender. Any amounts received by
the Swingline Lender from the Borrower (or other party on behalf of the
Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender
of the proceeds of a sale of participations therein shall be promptly remitted
to the Administrative Agent; any such amounts received by the Administrative
Agent shall be promptly remitted by the Administrative Agent to the Lenders that
shall have made their payments pursuant to this paragraph and to the Swingline
Lender, as their interests may appear; PROVIDED that any such payment so
remitted shall be repaid to the Swingline Lender or to the Administrative Agent,
as applicable, if and to the extent such payment is required to be refunded to
the Borrower for any reason. The purchase of participations in a Swingline Loan
pursuant to this paragraph shall not relieve the Borrower of any default in the
payment thereof.
Section 2.05. LETTERS OF CREDIT. (a) General. Subject to the
terms and conditions set forth herein, the Borrower may request the issuance of
Letters of Credit for itself, any Subsidiary or any Loan Party, in a form
reasonably acceptable to the Administrative Agent and the Issuing Bank, at any
time and from time to time during the Availability Period. In the event of any
inconsistency between the terms and conditions of this Agreement and the terms
and conditions of any form of letter of credit application
22
or other agreement submitted by the Borrower to, or entered into by the Borrower
with, the Issuing Bank relating to any Letter of Credit (including without
limitation the Existing Letter of Credit Agreements), the terms and conditions
of this Agreement shall control. Anything to the contrary contained herein
notwithstanding, the existing letters of credit set forth on Schedule 2.05(a)
hereof shall as of the Effective Date be deemed Letters of Credit under this
Agreement.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. To request the issuance of a Letter of Credit (or the amendment,
renewal or extension of an outstanding Letter of Credit), the Borrower shall
hand deliver or telecopy (or transmit by electronic communication, if
arrangements for doing so have been approved by the Issuing Bank) to the Issuing
Bank (reasonably in advance of the requested date of issuance, amendment,
renewal or extension) a notice requesting the issuance of a Letter of Credit, or
identifying the Letter of Credit to be amended, renewed or extended, the date of
issuance, amendment, renewal or extension, the date on which such Letter of
Credit is to expire (which shall comply with paragraph (c) of this Section), the
amount of such Letter of Credit, the name and address of the beneficiary thereof
and such other information as shall be necessary to prepare, amend, renew or
extend such Letter of Credit. On every Business Day, all Issuing Banks shall
report to the Administrative Agent (i) all such requests and (ii) the aggregate
amount of the Letters of Credit issued for the current reporting period. If
requested by the Issuing Bank, the Borrower also shall submit a letter of credit
application on the Issuing Bank's standard form in connection with any request
for a Letter of Credit. A Letter of Credit shall be issued, amended, renewed or
extended only if (and upon issuance, amendment, renewal or extension of each
Letter of Credit the Borrower shall be deemed to represent and warrant that),
after giving effect to such issuance, amendment, renewal or extension the total
Revolving Credit Exposures shall not exceed the total Commitments.
(c) Expiration Date. Each Letter of Credit shall expire at or
prior to the close of business on the earlier of (i) the date one year after the
date of the issuance of such Letter of Credit (or, in the case of any renewal or
extension thereof, one year after such renewal or extension); PROVIDED that a
Trade Letter of Credit may provide that it will be automatically extended,
unless the Issuing Bank shall have notified the beneficiary thereof that such
Trade Letter of Credit will not be so extended not less than a specified period
prior to the scheduled expiration date thereof, and so long as such automatic
extensions do not extend the term of any Trade Letter of Credit beyond the
Maturity Date and (ii) the Maturity Date.
(d) Participations. By the issuance of a Letter of Credit (or
an amendment to a Letter of Credit increasing the amount thereof) and without
any further action on the part of the Issuing Bank or the Lenders, the Issuing
Bank hereby grants to each Lender, and each Lender hereby acquires from the
Issuing Bank, a participation in such Letter of Credit equal to such Lender's
Applicable Percentage of the aggregate amount available to be drawn under such
Letter of Credit. In consideration and in furtherance of the foregoing, each
Lender hereby absolutely and unconditionally agrees to pay to the Administrative
Agent, for the account of the Issuing Bank, such Lender's Applicable Percentage
of each LC Disbursement made by the Issuing Bank and not reimbursed by
23
the Borrower on the date due as provided in paragraph (e) of this Section, or of
any reimbursement payment required to be refunded to the Borrower for any
reason. Each Lender acknowledges and agrees that its obligation to acquire
participations pursuant to this paragraph in respect of Letters of Credit is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including any amendment, renewal or extension of any Letter of
Credit or the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever.
(e) Reimbursement. If the Issuing Bank shall make any LC
Disbursement in respect of a Letter of Credit, and if the Borrower shall have
received notice of such LC Disbursement prior to 10:00 a.m., Cleveland time, on
such date, the Borrower shall reimburse such LC Disbursement by paying to the
Issuing Bank an amount equal to such LC Disbursement by not later than 3:00
p.m., Cleveland time, on the date that such LC Disbursement is made; if notice
of such LC Disbursement has not been received by the Borrower prior to 10:00
a.m. on such date, then the Borrower shall reimburse such LC Disbursement not
later than 12:00 noon, Cleveland time, on (i) the Business Day that the Borrower
receives such notice, if such notice is received prior to 10:00 a.m., Cleveland
time, on the day of receipt, or (ii) the Business Day immediately following the
day that the Borrower receives such notice, if such notice is not received prior
to such time on the day of receipt; PROVIDED that the Borrower may, subject to
the conditions to borrowing set forth herein, request in accordance with Section
2.03 that such payment be financed with an ABR Revolving Borrowing or Swingline
Loan in an equivalent amount and, to the extent so financed, the Borrower's
obligation to make such payment shall be discharged and replaced by the
resulting ABR Revolving Borrowing or Swingline Loan. If the Borrower fails to
make such payment when due, the Issuing Bank shall notify the Administrative
Agent and the Administrative Agent shall notify each Lender of the applicable LC
Disbursement, the payment then due from the Borrower in respect thereof and such
Lender's Applicable Percentage thereof. Promptly following receipt of such
notice, each Lender shall pay to the Administrative Agent its Applicable
Percentage of the payment then due from the Borrower, in the same manner as
provided in Section 2.06 with respect to Loans made by such Lender (and Section
2.06 shall apply, mutatis mutandis, to the payment obligations of the Lenders),
and the Administrative Agent shall promptly pay to the Issuing Bank the amounts
so received by it from the Lenders. Promptly following receipt by the
Administrative Agent of any payment from the Borrower pursuant to this
paragraph, the Administrative Agent shall distribute such payment to the Lenders
that have made payments pursuant to this paragraph to reimburse the Issuing Bank
and the Issuing Bank as their interests may appear. Any payment made by a Lender
pursuant to this paragraph to reimburse the Issuing Bank for any LC Disbursement
(other than the funding of ABR Revolving Loans or a Swingline Loan as
contemplated above) shall not constitute a Loan and shall not relieve the
Borrower of its obligation to reimburse such LC Disbursement.
(f) Obligations Absolute. The Borrower's obligation to
reimburse LC Disbursements as provided in paragraph (e) of this Section shall be
absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of
24
(i) any lack of validity or enforceability of any Letter of Credit or this
Agreement, or any term or provision therein, (ii) any draft or other document
presented under a Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or inaccurate in any
respect, (iii) payment by the Issuing Bank under a Letter of Credit against
presentation of a draft or other document that does not comply with the terms of
such Letter of Credit, or (iv) any other event or circumstance whatsoever,
whether or not similar to any of the foregoing, that might, but for the
provisions of this Section, constitute a legal or equitable discharge of, or
provide a right of setoff against, the Borrower's obligations hereunder. Neither
the Administrative Agent, the Lenders nor the Issuing Bank, nor any of their
Related Parties, shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
Issuing Bank; PROVIDED that the foregoing shall not be construed to excuse the
Issuing Bank from liability to the Borrower to the extent of any direct damages
(as opposed to consequential damages, claims in respect of which are hereby
waived by the Borrower to the extent permitted by applicable law) suffered by
the Borrower that are caused by the Issuing Bank's failure to exercise care when
determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof. The parties hereto expressly agree that,
in the absence of gross negligence or wilful misconduct on the part of the
Issuing Bank (as finally determined by a court of competent jurisdiction), the
Issuing Bank shall be deemed to have exercised care in each such determination.
In furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit, the
Issuing Bank may, in its sole discretion, either accept and make payment upon
such documents without responsibility for further investigation, regardless of
any notice or information to the contrary, or refuse to accept and make payment
upon such documents if such documents are not in strict compliance with the
terms of such Letter of Credit.
(g) Disbursement Procedures. The Issuing Bank shall, promptly
following its receipt thereof, examine all documents purporting to represent a
demand for payment under a Letter of Credit. The Issuing Bank shall promptly
notify the Administrative Agent and the Borrower by telephone (confirmed by
telecopy) of such demand for payment and whether the Issuing Bank has made or
will make an LC Disbursement thereunder; PROVIDED that any failure to give or
delay in giving such notice shall not relieve the Borrower of its obligation to
reimburse the Issuing Bank and the Lenders with respect to any such LC
Disbursement.
(h) Interim Interest. If the Issuing Bank shall make any LC
Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in
full on the date such LC Disbursement is made, the unpaid amount thereof shall
bear interest, for each day from and including the date such LC Disbursement is
made to but excluding the date that
25
the Borrower reimburses such LC Disbursement, at the rate per annum equal to the
lower of (i) the rate then applicable to ABR Revolving Loans and (ii) the
Federal Funds Effective Rate plus the then Applicable Margin for Eurodollar
Revolving Borrowings; PROVIDED that, if the Borrower fails to reimburse such LC
Disbursement when due pursuant to paragraph (e) of this Section, then Section
2.12(d) shall apply. Interest accrued pursuant to this paragraph shall be for
the account of the Issuing Bank, except that interest accrued on and after the
date of payment by any Lender pursuant to paragraph (e) of this Section to
reimburse the Issuing Bank shall be for the account of such Lender to the extent
of such payment.
(i) Addition, Termination or Replacement of an Issuing Bank.
An Issuing Bank may be replaced, added or terminated at any time by written
agreement between the Borrower and the Administrative Agent (whose consent will
not be unreasonably withheld) and the affected Issuing Bank(s). The
Administrative Agent shall notify the Lenders of any such addition, termination
or replacement of the Issuing Bank. At the time any such termination or
replacement shall become effective, the Borrower shall pay all unpaid fees
accrued for the account of the terminated or replaced Issuing Bank pursuant to
Section 2.11(b). From and after the effective date of any such addition or
replacement, (i) the new Issuing Bank shall have all the rights and obligations
of an Issuing Bank under this Agreement with respect to Letters of Credit to be
issued thereafter and (ii) references herein to the term "Issuing Bank" shall be
deemed to refer such new or to any previous Issuing Bank, or to such new and all
previous Issuing Banks, as the context shall require. After the termination or
replacement of an Issuing Bank hereunder, the terminated or replaced Issuing
Bank shall remain a party hereto and shall continue to have all the rights and
obligations of an Issuing Bank under this Agreement with respect to Letters of
Credit issued by it prior to such termination or replacement, but shall not be
required to issue additional Letters of Credit.
(j) Cash Collateralization. If any Event of Default shall
occur and be continuing, on the Business Day that the Borrower receives notice
from the Administrative Agent or the Required Lenders (or, if the maturity of
the Loans has been accelerated, Lenders with LC Exposure representing greater
than 50% of the total LC Exposure) demanding the deposit of cash collateral
pursuant to this paragraph, the Borrower shall deposit in an account with the
Administrative Agent, in the name of the Administrative Agent and for the
benefit of the Lenders, an amount in cash equal to the LC Exposure as of such
date plus any accrued and unpaid interest thereon; PROVIDED that the obligation
to deposit such cash collateral shall become effective immediately, and such
deposit shall become immediately due and payable, without demand or other notice
of any kind, upon the occurrence of any Event of Default with respect to the
Borrower described in clause (h) or (i) of Article VII. Such deposit shall be
held by the Administrative Agent as collateral for the payment and performance
of the obligations of the Borrower under this Agreement. The Administrative
Agent shall have exclusive dominion and control, including the exclusive right
of withdrawal, over such account. Other than any interest earned on the
investment of such deposits, which investments shall be made at the option and
sole discretion of the Administrative Agent and at the Borrower's risk and
expense, such deposits shall not bear interest. Interest or profits, if any, on
such investments shall accumulate in such account. Moneys in such account
26
shall be applied by the Administrative Agent to reimburse the Issuing Bank for
LC Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of
the Borrower for the LC Exposure at such time or, if the maturity of the Loans
has been accelerated (but subject to the consent of Lenders with LC Exposure
representing greater than 50% of the total LC Exposure), be applied to satisfy
other obligations of the Borrower under this Agreement. If the Borrower is
required to provide an amount of cash collateral hereunder as a result of the
occurrence of an Event of Default, such amount (to the extent not applied as
aforesaid) shall be returned to the Borrower within three Business Days after
all Events of Default have been cured or waived.
(k) Multiple Issuing Banks Contemplated. As used in this
Agreement, the term, "the Issuing Bank" shall mean the Issuing Bank issuing the
applicable Letter of Credit, but shall not be construed to mean that only one
Issuing Bank may exist at any given time.
Section 2.06. FUNDING OF BORROWINGS. (a) Each Lender shall
make each Loan to be made by it hereunder on the proposed date thereof by wire
transfer of immediately available funds by 12:00 noon, Cleveland time, to the
account of the Administrative Agent most recently designated by it for such
purpose by notice to the Lenders; PROVIDED that Swingline Loans shall be made as
provided in Section 2.04. The Administrative Agent will make such Loans
available to the Borrower by promptly crediting the amounts so received, in like
funds, to an account of the Borrower maintained with a Lender and designated by
the Borrower in the applicable Borrowing Request; PROVIDED that ABR Revolving
Loans made to finance the reimbursement of an LC Disbursement as provided in
Section 2.05(e) shall be remitted by the Administrative Agent to the Issuing
Bank.
(b) Unless the Administrative Agent shall have received notice
from a Lender prior to the proposed date of any Borrowing that such Lender will
not make available to the Administrative Agent such Lender's share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of this Section
and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Administrative Agent, then the
applicable Lender and the Borrower severally agree to pay to the Administrative
Agent forthwith on demand such corresponding amount with interest thereon, for
each day from and including the date such amount is made available to the
Borrower to but excluding the date of payment to the Administrative Agent, at
(i) in the case of such Lender, the greater of the Federal Funds Effective Rate
and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation or (ii) in the case of the Borrower,
the interest rate applicable to ABR Loans. If such Lender pays such amount to
the Administrative Agent, then such amount shall constitute such Lender's Loan
included in such Borrowing.
Section 2.07. INTEREST ELECTIONS. (a) Each Revolving Borrowing
initially shall be of the Type specified in the applicable Borrowing Request
and, in the
27
case of a Eurodollar Revolving Borrowing, shall have an initial Interest Period
as specified in such Borrowing Request. Thereafter, the Borrower may elect to
convert such Borrowing to a different Type or to continue such Borrowing and, in
the case of a Eurodollar Revolving Borrowing, may elect Interest Periods
therefor, all as provided in this Section. The Borrower may elect different
options with respect to different portions of the affected Borrowing, in which
case each such portion shall be allocated ratably among the Lenders holding the
Loans comprising such Borrowing, and the Loans comprising each such portion
shall be considered a separate Borrowing. This Section shall not apply to
Swingline Borrowings, which may not be converted or continued.
(b) To make an election pursuant to this Section, the Borrower
shall notify the Administrative Agent of such election by telephone by the time
that a Borrowing Request would be required under Section 2.03 if the Borrower
were requesting a Revolving Borrowing of the Type resulting from such election
to be made on the effective date of such election. Each such telephonic Interest
Election Request shall be irrevocable and shall be confirmed promptly by hand
delivery or telecopy to the Administrative Agent of a written Interest Election
Request in a form approved by the Administrative Agent and signed by the
Borrower.
(c) Each telephonic and written Interest Election Request
shall specify the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request
applies and, if different options are being elected with respect to
different portions thereof, the portions thereof to be allocated to
each resulting Borrowing (in which case the information to be specified
pursuant to clauses (iii) and (iv) below shall be specified for each
resulting Borrowing);
(ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR
Borrowing or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the
Interest Period to be applicable thereto after giving effect to such
election, which shall be a period contemplated by the definition of the
term "Interest Period".
If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrower shall be deemed to have
selected an Interest Period of one month's duration.
(d) Promptly following receipt of an Interest Election
Request, the Administrative Agent shall advise each Lender of the details
thereof and of such Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest
Election Request with respect to a Eurodollar Revolving Borrowing prior to the
end of the Interest Period
28
applicable thereto, then, unless such Borrowing is repaid as provided herein, at
the end of such Interest Period such Borrowing shall be converted to an ABR
Borrowing. Notwithstanding any contrary provision hereof, if an Event of Default
has occurred and is continuing and the Administrative Agent, at the request of
the Required Lenders, so notifies the Borrower, then, so long as an Event of
Default is continuing (i) no outstanding Revolving Borrowing may be converted to
or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar
Revolving Borrowing shall be converted to an ABR Borrowing at the end of the
Interest Period applicable thereto.
Section 2.08. TERMINATION AND REDUCTION OF COMMITMENTS. (a)
Unless previously terminated, the Commitments shall terminate on the Maturity
Date.
(b) The Borrower may at any time terminate, or from time to
time reduce, the Commitments; PROVIDED that (i) each reduction of the
Commitments shall be in an amount that is an integral multiple of $1,000,000 and
not less than $5,000,000 and (ii) the Borrower shall not terminate or reduce the
Commitments if, after giving effect to any concurrent prepayment of the Loans in
accordance with Section 2.10, the Revolving Credit Exposures would exceed the
total Commitments.
(c) In the event and on each occasion that any Net Proceeds
are received by or on behalf of the Parent, the Borrower or any Subsidiary in
respect of any Prepayment Event, then, unless a Reinvestment Notice shall be
delivered in respect thereof, the Borrower shall promptly, and in any event
within five Business Days after such Net Proceeds are received, reduce the total
Commitments by an aggregate amount equal to 100% of such Net Proceeds; PROVIDED,
that, on each Reinvestment Prepayment Date, an amount equal to the Reinvestment
Prepayment Amount with respect to the relevant Reinvestment Event shall be
applied to the permanent reduction of the total Commitments by an amount equal
to the Reinvestment Prepayment Amount.
(d) The Borrower shall notify the Administrative Agent of any
election to terminate or reduce the Commitments under paragraph (b) of this
Section at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by the
Borrower pursuant to this Section shall be irrevocable; PROVIDED that a notice
of termination of the Commitments delivered by the Borrower may state that such
notice is conditioned upon the effectiveness of other credit facilities or the
consummation of other specified transactions, in which case such notice may be
revoked by the Borrower (by notice to the Administrative Agent on or prior to
the specified effective date) if such condition is not satisfied. Any
termination or reduction of the Commitments shall be permanent. Each reduction
of the Commitments shall be made ratably among the Lenders in accordance with
their respective Commitments.
Section 2.09. REPAYMENT OF LOANS; EVIDENCE OF DEBT. (a) The
Borrower hereby unconditionally promises to pay (i) to the Administrative Agent
for the account of each Lender the then unpaid principal amount of each
Revolving Loan on the Maturity Date and (ii) to the Swingline Lender the then
unpaid principal amount of each
29
Swingline Loan on the earlier of the Maturity Date and the 14th day after such
Swingline Loan is made; PROVIDED that on each date that a Revolving Borrowing is
made, the Borrower shall repay all Swingline Loans then outstanding.
(b) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the Borrower to
such Lender resulting from each Loan made by such Lender, including the amounts
of principal and interest payable and paid to such Lender from time to time
hereunder.
(c) The Administrative Agent shall maintain accounts in which
it shall record (i) the amount of each Loan made hereunder, the Class and Type
thereof and the Interest Period applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received by
the Administrative Agent hereunder for the account of the Lenders and each
Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to
paragraph (b) or (c) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; PROVIDED that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans made by it be evidenced
by a promissory note. In such event, the Borrower shall prepare, execute and
deliver to such Lender a promissory note payable to the order of such Lender
(or, if requested by such Lender, to such Lender and its registered assigns) and
in a form approved by the Administrative Agent. Thereafter, the Loans evidenced
by such promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 9.04) be represented by one or more promissory
notes in such form payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its registered assigns).
Section 2.10. PREPAYMENT OF LOANS. (a) The Borrower shall have
the right at any time and from time to time to prepay any Borrowing in whole or
in part, subject to prior notice in accordance with paragraph (c) of this
Section.
(b) In the event and on each occasion that the aggregate
Revolving Credit Exposure exceeds the total aggregate Commitments (including
without limitation as a result of any reduction of Commitments required by
Section 2.08(c), the Borrower shall prepay Revolving Borrowings (or, if no such
Borrowings are outstanding, deposit cash collateral in an account with the
Administrative Agent pursuant to Section 2.05(j)) in an aggregate amount equal
to such excess.
(c) The Borrower shall notify the Administrative Agent (and,
in the case of prepayment of a Swingline Loan, the Swingline Lender) by
telephone (confirmed by telecopy) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar
30
Revolving Borrowing, not later than 11:00 a.m., Cleveland time, three Business
Days before the date of prepayment, (ii) in the case of prepayment of an ABR
Revolving Borrowing, not later than 11:00 a.m., Cleveland time, on the date of
prepayment or (iii) in the case of prepayment of a Swingline Loan, not later
than 12:00 noon, Cleveland time, on the date of prepayment. Each such notice
shall be irrevocable and shall specify the prepayment date and the principal
amount of each Borrowing or portion thereof to be prepaid; PROVIDED that, if a
notice of prepayment is given in connection with a conditional notice of
termination of the Commitments as contemplated by Section 2.08, then such notice
of prepayment may be revoked if such notice of termination is revoked in
accordance with Section 2.08. Promptly following receipt of any such notice
relating to a Revolving Borrowing, the Administrative Agent shall advise the
Lenders of the contents thereof. Each partial prepayment of any Revolving
Borrowing shall be in an amount that would be permitted in the case of an
advance of a Revolving Borrowing of the same Type as provided in Section 2.02 in
the aggregate principal amount thereof. Each prepayment of a Revolving Borrowing
shall be applied ratably to the Loans included in the prepaid Borrowing.
Prepayments shall be accompanied by accrued interest to the extent required by
Section 2.12.
Section 2.11. FEES. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a facility fee (the
"Facility Fee"), which shall accrue at the Applicable Margin on the daily amount
of the Commitment of such Lender (whether used or unused) during the period from
and including the date hereof to but excluding the date on which such Commitment
terminates; PROVIDED that, if such Lender continues to have any Revolving Credit
Exposure after its Commitment terminates, then such facility fee shall continue
to accrue on the daily amount of such Lender's Revolving Credit Exposure from
and including the date on which its Commitment terminates to but excluding the
date on which such Lender ceases to have any Revolving Credit Exposure. Accrued
facility fees shall be payable quarterly in arrears on the last Business Day of
January, April, July and October of each year and on the date on which the
Commitments terminate, commencing on the first such date to occur after the date
hereof; PROVIDED that any facility fees accruing after the date on which the
Commitments terminate shall be payable on demand. All facility fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).
(b) The Borrower agrees to pay (i) to the Administrative Agent
for the account of each Lender a participation fee with respect to its
participations in (x) Trade Letters of Credit, which shall accrue at the rate
equal to one half the Applicable Margin in effect for Eurodollar Revolving Loans
and (y) Standby Letters of Credit, which shall accrue at the Applicable Margin
in effect for Eurodollar Revolving Loans, on the average daily amount of such
Lender's LC Exposure (excluding any portion thereof attributable to unreimbursed
31
LC Disbursements) during the period from and including the Effective Date to but
excluding the later of the date on which such Lender's Commitment terminates and
the date on which such Lender ceases to have any LC Exposure, and (ii) to the
Issuing Bank a fronting fee, which shall accrue at the rate or rates per annum
separately agreed upon between the Borrower and the Issuing Bank on the average
daily amount of the LC Exposure (excluding any portion thereof attributable to
unreimbursed LC Disbursements) during the period from and including the
Effective Date to but excluding the later of the date of termination of the
Commitments and the date on which there ceases to be any LC Exposure, as well as
the Issuing Bank's standard fees with respect to the issuance, amendment,
renewal or extension of any Letter of Credit or processing of drawings
thereunder. Participation fees and fronting fees accrued through and including
the last day of January, April, July and October of each year shall be payable
on the last Business Day of January, April, July and October of each year,
commencing on the first such date to occur after the Effective Date; PROVIDED
that all such fees shall be payable on the date on which the Commitments
terminate and any such fees accruing after the date on which the Commitments
terminate shall be payable on demand. Any other fees payable to the Issuing Bank
pursuant to this paragraph shall be payable within 10 days after demand. All
participation fees and fronting fees shall be computed on the basis of a year of
360 days and shall be payable for the actual number of days elapsed (including
the first day but excluding the last day).
(c) The Borrower agrees to pay to the Administrative Agent,
for its own account, fees payable in the amounts and at the times separately
agreed upon between the Borrower and the Administrative Agent.
(d) The Borrower agrees to pay to the Administrative Agent,
for the account of each Lender, a utilization fee (a "UTILIZATION FEE") for each
day during the preceding quarter (or shorter period commencing with the date
hereof or ending with the date on which the Commitments shall have been
terminated and the Loans repaid in full) on which the aggregate amount of all
Loans outstanding (excluding Trade Letters of Credit) exceeded 50% of the total
Commitments (including each day after the termination of the Commitments on
which Loans shall be outstanding), at a per annum rate equal to the Applicable
Margin, on the sum of the outstanding principal amount of Revolving Loans and
Standby LC Exposure on such day. Accrued Utilization Fees shall be payable in
arrears on the last Business Day of January, April, July and October of each
year and on the Maturity Date, commencing on the first such date to occur after
the date hereof; PROVIDED that any Utilization Fees accruing after the date on
which the Commitments terminate shall be payable on demand. All Utilization Fees
shall be computed on the basis of a year of 360 days and shall be payable for
the actual number of days elapsed (including the first day but excluding the
last day).
(e) All fees payable hereunder shall be paid on the dates due,
in immediately available funds, to the Administrative Agent (or to the Issuing
Bank, in the case of fees payable to it) for distribution, in the case of
facility fees and participation fees, to the Lenders. Fees paid shall not be
refundable under any circumstances.
Section 2.12. INTEREST. (a) The Loans comprising each ABR
Borrowing (including each Swingline Loan) shall bear interest at the Alternate
Base Rate.
(b) The Loans comprising each Eurodollar Revolving Loan shall
bear interest at the LIBO Rate for the Interest Period in effect for such
Borrowing plus the Applicable Margin.
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(c) For so long as any Lender maintains reserves against
"Eurocurrency liabilities" (or any other category of liabilities which includes
deposits by reference to which the interest rate on Eurodollar Loans is
determined or any category of extensions of credit or other assets which
includes loans by a non-United States office of any Lender to United States
residents), and as a result the cost to such Lender (or its Eurodollar lending
office) of making or maintaining its Eurodollar Loans is increased, then such
Lender may require the Borrower to pay, contemporaneously with each payment of
interest on any Eurodollar Loan of such Lender, additional interest on such
Eurodollar Loan for the Interest Period of such Eurodollar Loan at a rate per
annum up to but not exceeding the excess of (i)(A) the applicable LIBO Rate, as
the case may be, divided by (B) one minus the Statutory Reserve Rate over (ii)
the rate specified in the preceding clause (i)(A). Any Lender wishing to require
payment of such additional interest pursuant to the preceding sentence (x) shall
so notify the Borrower and the Administrative Agent, in which case such
additional interest on the Eurodollar Loans of such Lender shall be payable to
such Bank at the place indicated in such notice with respect to each Interest
Period commencing at least three Business Days after the giving of such notice
and (y) shall furnish to the applicable Borrower at least five Business Days
prior to each date on which interest is payable on such Eurodollar Loans an
officer's certificate setting forth the amount to which such Lender is then
entitled under this subsection (c) (which shall be consistent with such Lender's
good faith estimate of the level at which the related reserves are maintained by
it). Each such certificate shall be accompanied by such information as the
Borrower may reasonably request as to the computation set forth therein.
(d) Notwithstanding the foregoing, if any principal of or
interest on any Loan or any fee or other amount payable by the Borrower
hereunder is not paid when due, whether at stated maturity, upon acceleration or
otherwise, such overdue amount shall bear interest, after as well as before
judgment, at a rate per annum equal to (i) in the case of overdue principal of
any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the
preceding paragraphs of this Section or (ii) in the case of any other amount, 2%
plus the rate applicable to ABR Loans as provided in paragraph (a) of this
Section.
(e) Accrued interest on each Loan shall be payable in arrears
on each Interest Payment Date for such Loan and, in the case of Revolving Loans,
upon termination of the Commitments; PROVIDED that (i) interest accrued pursuant
to paragraph (d) of this Section shall be payable on demand, (ii) in the event
of any repayment or prepayment of any Loan (other than a prepayment of an ABR
Revolving Loan prior to the end of the Availability Period), accrued interest on
the principal amount repaid or prepaid shall be payable on the date of such
repayment or prepayment and (iii) in the event of any conversion of any
Eurodollar Revolving Loan prior to the end of the current Interest Period
therefor, accrued interest on such Loan shall be payable on the effective date
of such conversion.
(f) All interest hereunder shall be computed on the basis of a
year of 360 days, except that interest computed by reference to the Alternate
Base Rate at times when the Alternate Base Rate is based on the Prime Rate shall
be computed on the basis of a
33
year of 365 days (or 366 days in a leap year), and in each case shall be payable
for the actual number of days elapsed (including the first day but excluding the
last day). The applicable Alternate Base Rate or LIBO Rate shall be determined
by the Administrative Agent, and such determination shall be conclusive absent
manifest error.
Section 2.13. ALTERNATE RATE OF INTEREST. If prior to the
commencement of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which
determination shall be conclusive absent manifest error) that
adequate and reasonable means do not exist for ascertaining
the LIBO Rate for such Interest Period; or
(b) the Administrative Agent is advised by the
Required Lenders that the LIBO Rate for such Interest Period
will not adequately and fairly reflect the cost to such
Lenders (or Lender) of making or maintaining their Loans (or
its Loan) included in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Revolving Borrowing to, or
continuation of any Revolving Borrowing as, a Eurodollar Borrowing shall be
ineffective and (ii) if any Borrowing Request requests a Eurodollar Revolving
Borrowing, such Borrowing shall be made as an ABR Borrowing.
Section 2.14. INCREASED COSTS. (a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or for
the account of, or credit extended by, any Lender or the Issuing Bank;
or
(ii) impose on any Lender or the Issuing Bank or the London
interbank market any other condition affecting this Agreement or
Eurodollar Loans made by such Lender or any Letter of Credit or
participation therein;
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to increase the cost to such Lender or the
Issuing Bank of participating in, issuing or maintaining any Letter of Credit or
to reduce the amount of any sum received or receivable by such Lender or the
Issuing Bank hereunder (whether of principal, interest or otherwise), then the
Borrower will pay to such Lender or the Issuing Bank, as the case may be, such
additional amount or amounts as will compensate such Lender or the Issuing Bank,
as the case may be, for such additional costs incurred or reduction suffered.
34
(b) If any Lender or the Issuing Bank determines that any
Change in Law regarding capital requirements has or would have the effect of
reducing the rate of return on such Lender's or the Issuing Bank's capital or on
the capital of such Lender's or the Issuing Bank's holding company, if any, as a
consequence of this Agreement or the Loans made by, or participations in Letters
of Credit held by, such Lender, or the Letters of Credit issued by the Issuing
Bank, to a level below that which such Lender or the Issuing Bank or such
Lender's or the Issuing Bank's holding company could have achieved but for such
Change in Law (taking into consideration such Lender's or the Issuing Bank's
policies and the policies of such Lender's or the Issuing Bank's holding company
with respect to capital adequacy), then from time to time the Borrower will pay
to such Lender or the Issuing Bank, as the case may be, such additional amount
or amounts as will compensate such Lender or the Issuing Bank or such Lender's
or the Issuing Bank's holding company for any such reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting
forth the amount or amounts necessary to compensate such Lender or the Issuing
Bank or its holding company, as the case may be, as specified in paragraph (a)
or (b) of this Section shall be delivered promptly to the Borrower and shall be
conclusive absent manifest error. The Borrower shall pay such Lender or the
Issuing Bank, as the case may be, the amount shown as due on any such
certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender or the Issuing
Bank to demand compensation pursuant to this Section shall not constitute a
waiver of such Lender's or the Issuing Bank's right to demand such compensation;
PROVIDED that the Borrower shall not be required to compensate a Lender or the
Issuing Bank pursuant to this Section for any increased costs or reductions
incurred more than 90 days prior to the date that such Lender or the Issuing
Bank, as the case may be, notifies the Borrower of the Change in Law giving rise
to such increased costs or reductions and of such Lender's or the Issuing Bank's
intention to claim compensation therefor; PROVIDED FURTHER that, if the Change
in Law giving rise to such increased costs or reductions is retroactive, then
the 90-day period referred to above shall be extended to include the period of
retroactive effect thereof.
Section 2.15. BREAK FUNDING PAYMENTS. In the event of (a) the
payment of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last day
of the Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Eurodollar Revolving Loan on the date specified in any
notice delivered pursuant hereto (regardless of whether such notice may be
revoked under Section 2.10(b) and is revoked in accordance therewith) or (d) the
assignment of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto as a result of a request by the Borrower pursuant to
Section 2.18, then, in any such event, the Borrower shall compensate each Lender
for the loss, cost and expense attributable to such event. In the case of a
Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to
include an amount determined by such Lender to be the excess, if any, of (i) the
amount of interest which would have accrued on the principal amount of such Loan
had such event not occurred, at the LIBO Rate that would
35
have been applicable to such Loan, for the period from the date of such event to
the last day of the then current Interest Period therefor (or, in the case of a
failure to borrow, convert or continue, for the period that would have been the
Interest Period for such Loan), over (ii) the amount of interest which would
accrue on such principal amount for such period at the interest rate which such
Lender would bid were it to bid, at the commencement of such period, for dollar
deposits of a comparable amount and period from other banks in the Eurodollar
market. A certificate of any Lender setting forth any amount or amounts that
such Lender is entitled to receive pursuant to this Section shall be delivered
to the Borrower and shall be conclusive absent manifest error. The Borrower
shall pay such Lender the amount shown as due on any such certificate within 10
days after receipt thereof.
Section 2.16. TAXES. (a) Any and all payments by or on account
of any obligation of the Borrower hereunder shall be made free and clear of and
without deduction for any Indemnified Taxes or Other Taxes; PROVIDED that if the
Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, Lender or
Issuing Bank (as the case may be) receives an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower shall make
such deductions and (iii) the Borrower shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent,
each Lender and the Issuing Bank, within 10 days after written demand therefor,
for the full amount of any Indemnified Taxes or Other Taxes paid by the
Administrative Agent, such Lender or the Issuing Bank, as the case may be, on or
with respect to any payment by or on account of any obligation of the Borrower
hereunder (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any penalties, interest
and reasonable expenses arising therefrom or with respect thereto, whether or
not such Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority; PROVIDED, however, that if
written demand for payment of an Indemnified Tax or Other Tax has not been made
by the Administrative Agent, a Lender or the Issuing Bank within 30 Business
Days from the later of (i) the date the Administrative Agent, such Lender or the
Issuing Bank knew of the imposition thereof or (ii) the date such Indemnified
Tax or Other Tax is due, then the Borrower shall not be obligated to pay or
indemnify the Administrative Agent, such Lender or the Issuing Bank for
penalties with respect to such Indemnified Taxes or Other Taxes that would not
have been owed had such demand been made within 45 days and payment thereof
occurred within 60 days from such date. A certificate as to the amount of such
payment or liability delivered to the Borrower by a Lender or the Issuing Bank,
or by the Administrative Agent on its own behalf or on behalf of a Lender or the
Issuing Bank, shall be conclusive absent manifest error.
36
(d) As soon as practicable after any payment of Indemnified
Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower
shall deliver to the Administrative Agent the original or a certified copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return reporting such payment or other evidence of such payment reasonably
satisfactory to the Administrative Agent.
(e) Each Foreign Lender that is entitled to an exemption from
or reduction in withholding tax under the laws of the United States (or such
other jurisdiction in which the Borrower may be located) shall, before the time
prescribed by applicable law, and from time to time thereafter (as required by
applicable law) before the date any such form expires or becomes obsolete or
invalid, provide the Borrower and the Administrative Agent with Internal Revenue
Service form W8-BEN or W8-ECI in duplicate, as appropriate, or such other form
prescribed by the Internal Revenue Service that it may legally provide,
certifying that such Foreign Lender is entitled to benefits under an income tax
treaty to which the United States is a party which exempts the Lender from
United States withholding tax or reduces the rate of United States withholding
tax on payments of interest for the account of such Foreign Lender, or
certifying that the income receivable pursuant to this Agreement is effectively
connected with the conduct of such Foreign Lender's trade or business in the
United States and exempt from United States withholding tax.
(f) If an Issuing Bank, the Administrative Agent or a Lender
becomes aware that it has received a refund in respect of any Indemnified Taxes
or Other Taxes as to which it has been indemnified by the Borrower pursuant to
this Section 2.16 or with respect to which the Borrower has paid additional
amounts pursuant to this Section 2.16, it shall, in a reasonable period of time,
pay over such refund to the Borrower (but only to the extent of indemnity
payments made, or additional amounts paid, by the Borrower under this Section
2.16 with respect to the Indemnified Taxes or Other Taxes giving rise to such
refund), net of all out-of-pocket expenses of the Administrative Agent or such
Lender and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund); PROVIDED, that the
Borrower, upon the request of the Administrative Agent or such Lender, agrees to
repay the amount paid over to the Borrower (plus any penalties, interest or
other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or such Lender in the event the Administrative Agent or
such Lender is required to repay such refund to such Governmental Authority.
This Section shall not be construed to require the Administrative Agent or any
Lender to make available its tax returns (or any other information relating to
its taxes which it deems confidential) to the Borrower or any other Person.
Section 2.17. PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING
OF SET-OFFS. (a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees or reimbursement of LC
Disbursements, or of amounts payable under Section 2.14, 2.15 or 2.16, or
otherwise) not later than 3:00 p.m., Cleveland time, on the date when due, in
immediately available funds, without set-off or counterclaim. Any amounts
received after such time on any date may, in the discretion
37
of the Administrative Agent, be deemed to have been received on the next
succeeding Business Day for purposes of calculating interest thereon. All such
payments shall be made to the Administrative Agent at its offices at National
City Bank, 000 Xxxxxx Xxxxxx, Xxxxxx Xxxxx, Xxxxxxxxx, Xxxx 00000, except
payments to be made directly to the Issuing Bank or Swingline Lender as
expressly provided herein and except that payments pursuant to Sections 2.14,
2.15, 2.16 and 9.03 shall be made directly to the Persons entitled thereto. The
Administrative Agent shall distribute any such payments received by it for the
account of any other Person to the appropriate recipient promptly following
receipt thereof. If any payment hereunder shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next succeeding
Business Day, and, in the case of any payment accruing interest, interest
thereon shall be payable for the period of such extension. All payments
hereunder shall be made in dollars.
(b) If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal,
unreimbursed LC Disbursements, interest and fees then due hereunder, such funds
shall be applied (i) first, towards payment of interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) second, towards
payment of principal and unreimbursed LC Disbursements then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
principal and unreimbursed LC Disbursements then due to such parties.
(c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Revolving Loans or participations in LC Disbursements or
Swingline Loans resulting in such Lender receiving payment of a greater
proportion of the aggregate amount of its Revolving Loans and participations in
LC Disbursements and Swingline Loans and accrued interest thereon than the
proportion received by any other Lender, then the Lender receiving such greater
proportion shall purchase (for cash at face value) participations in the
Revolving Loans and participations in LC Disbursements and Swingline Loans of
other Lenders to the extent necessary so that the benefit of all such payments
shall be shared by the Lenders ratably in accordance with the aggregate amount
of principal of and accrued interest on their respective Revolving Loans and
participations in LC Disbursements and Swingline Loans; PROVIDED that (i) if any
such participations are purchased and all or any portion of the payment giving
rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, without interest, and
(ii) the provisions of this paragraph shall not be construed to apply to any
payment made by the Borrower pursuant to and in accordance with the express
terms of this Agreement or any payment obtained by a Lender as consideration for
the assignment of or sale of a participation in any of its Loans or
participations in LC Disbursements to any assignee or participant, other than to
the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions
of this paragraph shall apply). The Borrower consents to the foregoing and
agrees, to the extent it may effectively do so under applicable law, that any
Lender acquiring a participation pursuant to the foregoing arrangements may
exercise against the Borrower rights of set-
38
off and counterclaim with respect to such participation as fully as if such
Lender were a direct creditor of the Borrower in the amount of such
participation.
(d) Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders or the Issuing Bank
hereunder that the Borrower will not make such payment, the Administrative Agent
may assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders or
the Issuing Bank, as the case may be, the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders or the
Issuing Bank, as the case may be, severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such
Lender or Issuing Bank with interest thereon, for each day from and including
the date such amount is distributed to it to but excluding the date of payment
to the Administrative Agent, at the greater of the Federal Funds Effective Rate
and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to
be made by it pursuant to Section 2.05(d) or (e), 2.06(b) or 2.17(d), then the
Administrative Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the Administrative
Agent for the account of such Lender to satisfy such Lender's obligations under
such Sections until all such unsatisfied obligations are fully paid.
Section 2.18. MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS.
(a) If any Lender requests compensation under Section 2.14, or if the Borrower
is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.16, then such
Lender shall use reasonable efforts to designate a different lending office for
funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if, in the judgment
of such Lender, such designation or assignment (i) would eliminate or reduce
amounts payable pursuant to Section 2.14 or 2.16, as the case may be, in the
future and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.
(b) If any Lender requests compensation under Section 2.14, or
if the Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.16,
or if any Lender defaults in its obligation to fund Loans hereunder, then the
Borrower may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights and obligations under this Agreement to
an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); PROVIDED that (i) the Borrower
shall have received the prior written consent of the Administrative Agent (and,
if a
39
Commitment is being assigned, the Issuing Bank), which consent shall not
unreasonably be withheld, (ii) such Lender shall have received payment of an
amount equal to the outstanding principal of its Loans and participations in LC
Disbursements and Swingline Loans, accrued interest thereon, accrued fees and
all other amounts payable to it hereunder, from the assignee (to the extent of
such outstanding principal and accrued interest and fees) or the Borrower (in
the case of all other amounts) and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.14 or payments required
to be made pursuant to Section 2.16, such assignment will result in a reduction
in such compensation or payments. A Lender shall not be required to make any
such assignment and delegation if, prior thereto, as a result of a waiver by
such Lender or otherwise, the circumstances entitling the Borrower to require
such assignment and delegation cease to apply.
Section 2.19. INCREASE IN REVOLVING CREDIT COMMITMENTS. (a)
After the date hereof, the Borrower may, by written notice to the Administrative
Agent, request Additional Credit Commitments in an amount not to exceed
$50,000,000 from one or more Additional Credit Lenders, which may include any
existing Lender; PROVIDED that during the life of this Agreement, the Borrower
may only make one request for Additional Credit Commitments pursuant to this
Section 2.19; PROVIDED FURTHER that each Additional Credit Lender, if not
already a Lender hereunder, shall be subject to the approval of the
Administrative Agent and the Borrower (which approvals shall not be unreasonably
withheld). Each such notice shall set forth (i) the amount of the Additional
Credit Commitments being requested (which shall be in a minimum amount of
$2,500,000) and (ii) the date on which such Additional Credit Commitments are
requested to become effective (which shall not be less than 10 Business Days nor
more than 60 days after the date of such notice).
(b) The Borrower and each Additional Credit Lender shall
execute and deliver to the Administrative Agent an Additional Credit Assumption
Agreement and such other documentation as the Administrative Agent shall
reasonably specify to evidence the Additional Credit Commitment of such
Additional Credit Lender. The Administrative Agent shall promptly notify each
Lender as to the effectiveness of each Additional Credit Assumption Agreement.
Each of the parties hereto hereby agrees that, upon the effectiveness of any
Additional Credit Assumption Agreement, each such Additional Credit Lender
shall, to the extent not an existing Lender, become a Lender hereunder and this
Agreement shall be deemed amended to the extent (but only to the extent)
necessary to reflect the existence and terms of the Additional Credit Commitment
evidenced thereby.
(c) Each of the parties hereto hereby agrees that the
Administrative Agent may take any and all actions as may be reasonably necessary
to ensure that, after giving effect to any Additional Credit Commitment pursuant
to this Section 2.19, the outstanding Loans (if any) are held by the Lenders in
accordance with their new pro rata percentages. This may be accomplished at the
discretion of the Administrative Agent (i) by requiring the outstanding Loans to
be prepaid with the proceeds of a new Borrowing, (ii) by causing the existing
Lenders to assign portions of their outstanding Loans to Additional Credit
Lenders, which assignments shall be deemed to be effective pursuant to
40
Section 9.04 or (iii) by any combination of the foregoing. Notwithstanding the
foregoing, in order to eliminate any break funding liability to the Borrower,
if, upon the date that any Additional Credit Commitment becomes effective
pursuant to this Section 2.19, there is an unpaid principal amount of Revolving
Loans to the Borrower, the principal outstanding amount of all such Revolving
Loans shall (A) in the case of such Revolving Loans which are ABR Loans, be
immediately prepaid by the Borrower (but all such Revolving Loans may, on the
terms and conditions hereof, be reborrowed on such date on a pro rata basis,
based on the revised Commitments as then in effect) and (B) in the case of such
Revolving Loans which are Eurodollar Loans, continue to remain outstanding
(notwithstanding any other requirement in this Agreement that such Revolving
Loans be held on a pro rata basis based on the revised Commitments as then in
effect) until the end of the then current Interest Period therefor, at which
time such Eurodollar Loans shall be paid by the Borrower (but all such Revolving
Loans may, on the terms and conditions hereof, be reborrowed on such date on a
pro rata basis, based on the Commitments as then in effect).
(d) Notwithstanding the foregoing, no Additional Credit
Commitment shall become effective under this Section 2.19 unless on the date of
such effectiveness, the conditions set forth in paragraphs (a) and (b) of
Section 4.02 shall be satisfied and the Administrative Agent shall have received
a certificate to that effect dated such date and executed by a Financial Officer
of the Borrower.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
Section 3.01. ORGANIZATION; POWERS. Each of the Parent, the
Borrower and the Subsidiaries is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, has all
requisite power and authority to carry on its business as now conducted and,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, is qualified to
do business in, and is in good standing in, every jurisdiction where such
qualification is required.
Section 3.02. AUTHORIZATION; ENFORCEABILITY. The Transactions
to be entered into by each Loan Party are within such Loan Party's corporate
powers and have been duly authorized by all necessary corporate and, if
required, stockholder action. This Agreement has been duly executed and
delivered by each of the Parent and the Borrower and constitutes, and each other
Loan Document to which any Loan Party is to be a party, when executed and
delivered by such Loan Party, will constitute, a legal, valid and binding
obligation of each of the Parent, the Borrower or such Loan Party (as the case
may be), enforceable in accordance with its terms, subject to applicable
bankruptcy,
41
insolvency, reorganization, moratorium or other laws affecting creditors' rights
generally and subject to general principles of equity, regardless of whether
considered in a proceeding in equity or at law.
Section 3.03. GOVERNMENTAL APPROVALS; NO CONFLICTS. The
Transactions (a) do not require any consent or approval of, registration or
filing with, or any other action by, any Governmental Authority, except such as
have been obtained or made and are in full force and effect, (b) will not
violate any applicable law or regulation or the charter, by-laws or other
organizational documents of any of the Parent, the Borrower or any Subsidiary or
any order of any Governmental Authority, (c) will not violate or result in a
default under any indenture or other agreement for borrowed money or under any
other material agreement binding upon any of the Parent, the Borrower or any
Subsidiary or its assets, or give rise to a right thereunder to require any
payment to be made by any of the Parent, the Borrower or any Subsidiary, and (d)
will not result in the creation or imposition of any Lien on any material asset
of any of the Parent, the Borrower or any Subsidiary.
Section 3.04. FINANCIAL CONDITION; NO MATERIAL ADVERSE CHANGE.
(a) The Parent has heretofore furnished to the Lenders its consolidated balance
sheet and statements of income, stockholders equity and cash flows (i) as of and
for the fiscal year ended on February 2, 2002, reported on by
PricewaterhouseCoopers LLP, independent public accountants, and (ii) as of and
for the fiscal quarter ended on August 3, 2002, certified by its chief financial
officer. Such financial statements present fairly, in all material respects, the
financial position and results of operations and cash flows of the Parent and
its consolidated Subsidiaries as of such dates and for such periods in
accordance with GAAP, subject to year-end audit adjustments and the absence of
footnotes in the case of the statements referred to in clause (ii) above.
(b) Since February 2, 2002, there has been no material adverse
change in the business, assets, operations, prospects or condition, financial or
otherwise, of the Parent, the Borrower and the Subsidiaries, taken as a whole.
Section 3.05. PROPERTIES. (a) Each of the Parent, the Borrower
and the Subsidiaries has good title to, or valid leasehold interests in, all its
real and personal property material to its business, except for defects in title
that, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect.
(b) Each of the Parent, the Borrower and the Subsidiaries
owns, or is licensed to use, all trademarks, trade names, copyrights, patents
and other intellectual property material to its business, and the use thereof by
the Parent, the Borrower and the Subsidiaries does not infringe upon the rights
of any other Person, except for any such failure to own or be licensed and
infringements that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.
Section 3.06. LITIGATION AND ENVIRONMENTAL MATTERS. (a) There
are no actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of the Borrower, threatened
against or affecting any
42
of the Parent, the Borrower or any of the Subsidiaries (i) as to which there is
a reasonable possibility of an adverse determination and that, if adversely
determined, could reasonably be expected, individually or in the aggregate, to
result in a Material Adverse Effect (other than the Disclosed Matters) or (ii)
that expressly contest the validity of this Agreement or the Transactions.
(b) Except for the Disclosed Matters and except with respect
to any other matters that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, none of the
Parent, the Borrower nor any Subsidiary (i) has failed to comply with any
Environmental Law or to obtain, maintain or comply with any permit, license or
other approval required under any Environmental Law, (ii) has become subject to
any Environmental Liability, (iii) has received notice of any claim with respect
to any Environmental Liability or (iv) knows of any basis for any Environmental
Liability.
(c) Since the date of this Agreement, there has been no change
in the status of the Disclosed Matters that, individually or in the aggregate,
has resulted in, or materially increased the likelihood of, a Material Adverse
Effect.
Section 3.07. COMPLIANCE WITH LAWS AND AGREEMENTS. Each of the
Parent, the Borrower and the Subsidiaries is in compliance with all laws,
regulations and orders of any Governmental Authority applicable to it or its
property and all indentures, agreements and other instruments binding upon it or
its property, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect. No Default has occurred and is continuing.
Section 3.08. INVESTMENT AND HOLDING COMPANY STATUS. None of
the Parent, the Borrower nor any Subsidiary is (a) an "investment company" as
defined in, or subject to regulation under, the Investment Company Act of 1940
or (b) a "holding company" as defined in, or subject to regulation under, the
Public Utility Holding Company Act of 1935.
Section 3.09. TAXES. Each of the Parent, the Borrower and the
Subsidiaries has timely filed or caused to be filed all Tax returns and reports
required to have been filed and has paid or caused to be paid all Taxes required
to have been paid by it, except (a) Taxes that are being contested in good faith
by appropriate proceedings and for which the Parent, the Borrower or such
Subsidiary, as applicable, has set aside on its books adequate reserves or (b)
to the extent that the failure to do so could not reasonably be expected to
result in a Material Adverse Effect.
Section 3.10. ERISA. No ERISA Event has occurred or is
reasonably expected to occur that, when taken together with all other such ERISA
Events for which liability is reasonably expected to occur, could reasonably be
expected to result in a Material Adverse Effect.
Section 3.11. DISCLOSURE. The reports, financial statements,
certificates and other information furnished by or on behalf of the Parent or
the Borrower to the
43
Administrative Agent or any Lender in connection with the negotiation of this
Agreement or delivered hereunder (as modified or supplemented by other
information so furnished), taken as a whole, do not contain any material
misstatement of fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; PROVIDED that, with respect to projected financial
information, the Borrower represents only that such information was prepared in
good faith based upon assumptions believed to be reasonable at the time.
Section 3.12. SUBSIDIARIES. Schedule 3.12 sets forth the name
of, and the ownership interest of the Parent and each of its Subsidiaries in,
and of the Borrower and each of its Subsidiaries in, each Subsidiary, in each
case as of the Effective Date. Each Subsidiary is a Loan Party as of the
Effective Date.
ARTICLE IV
CONDITIONS
Section 4.01. EFFECTIVE DATE. The obligations of the Lenders
to make Loans and of the Issuing Bank to issue Letters of Credit hereunder shall
not become effective until the date on which each of the following conditions is
satisfied (or waived in accordance with Section 9.02):
(a) The Administrative Agent (or its counsel) shall have
received from each party hereto either (i) a counterpart of this Agreement
signed on behalf of such party or (ii) written evidence satisfactory to the
Administrative Agent (which may include telecopy transmission of a signed
signature page of this Agreement) that such party has signed a counterpart of
this Agreement.
(b) The Administrative Agent shall have received a favorable
written opinion (addressed to the Administrative Agent and the Lenders and dated
the Effective Date) of Vorys, Xxxxx, Xxxxxxx and Xxxxx, counsel for the
Borrower, acceptable to the Administrative Agent, substantially in the form of
Exhibit D, and covering such other matters relating to the Borrower, this
Agreement or the Transactions as the Required Lenders shall reasonably request.
The Borrower hereby requests such counsel to deliver such opinion.
(c) The Administrative Agent shall have received such
documents and certificates as the Administrative Agent or its counsel may
reasonably request relating to the organization, existence and good standing of
each Loan Party, the authorization of the Transactions and any other legal
matters relating to the Loan Parties, this Agreement or the Transactions, all in
form and substance reasonably satisfactory to the Administrative Agent and its
counsel.
(d) The Administrative Agent shall have received a
certificate, dated the Effective Date and signed by a Financial Officer of the
Borrower, confirming compliance with the conditions set forth in paragraphs (a)
and (b) of Section 4.02.
44
(e) The Administrative Agent shall have received all fees and
other amounts due and payable on or prior to the Effective Date, including, to
the extent invoiced, reimbursement or payment of all out-of-pocket expenses
required to be reimbursed or paid by the Borrower hereunder.
(f) The Administrative Agent shall have received counterparts
of the Guarantee Agreement signed on behalf of the Parent and each U.S.
Subsidiary.
(g) The Administrative Agent shall have received evidence in a
form satisfactory to it that the Existing Credit Agreement and the Existing
Letter of Credit Agreements have been terminated and all obligations of the
Borrower, the Parent and any Subsidiary thereunder have been paid ; PROVIDED
that the existing letters of credit set forth on Schedule 2.05 shall be deemed
Letters of Credit under this Agreement and shall not be terminated.
The Administrative Agent shall notify the Borrower and the
Lenders of the Effective Date, and such notice shall be conclusive and binding.
Notwithstanding the foregoing, the obligations of the Lenders to make Loans and
of the Issuing Bank to issue Letters of Credit hereunder shall not become
effective unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 9.02) at or prior to 3:00 p.m., Cleveland time, on November
14, 2002 (and, in the event such conditions are not so satisfied or waived, the
Commitments shall terminate at such time).
Section 4.02. EACH CREDIT EVENT. The obligation of each Lender
to make a Loan on the occasion of any Borrowing, and of the Issuing Bank to
issue, amend, renew or extend any Letter of Credit, is subject to the
satisfaction of the following conditions:
(a) The representations and warranties of each of the Parent
and the Borrower set forth in this Agreement shall be true and correct on and as
of the date of such Borrowing or the date of issuance, amendment, renewal or
extension of such Letter of Credit, as applicable, except to the extent any such
representation or warranty is limited to another particular date, in which
instance, such representation or warranty shall be true and correct on and as of
such other date.
(b) At the time of and immediately after giving effect to such
Borrowing or the issuance, amendment, renewal or extension of such Letter of
Credit, as applicable, no Default shall have occurred and be continuing.
Each Borrowing and each issuance, amendment, renewal or extension of a Letter of
Credit shall be deemed to constitute a representation and warranty by each of
the Parent and the Borrower on the date thereof as to the matters specified in
paragraphs (a) and (b) of this Section.
45
ARTICLE V
AFFIRMATIVE COVENANTS
Until the Commitments have expired or been terminated and the
principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full and all Letters of Credit shall have expired or terminated and
all LC Disbursements shall have been reimbursed, each of the Parent and the
Borrower covenants and agrees with the Lenders that:
Section 5.01. FINANCIAL STATEMENTS AND OTHER INFORMATION. The
Parent will furnish to the Administrative Agent and each Lender:
(a) within 90 days after the end of each fiscal year
of the Parent, its audited consolidated balance sheet and
related statements of income, stockholders' equity and cash
flows as of the end of and for such year, setting forth in
each case in comparative form the figures for the previous
fiscal year, all reported on by PricewaterhouseCoopers LLP or
other independent public accountants of recognized national
standing (without a "going concern" or like qualification or
exception and without any qualification or exception as to the
scope of such audit) to the effect that such consolidated
financial statements present fairly in all material respects
the financial condition and results of operations of the
Parent and its consolidated Subsidiaries on a consolidated
basis in accordance with GAAP consistently applied;
(b) within 45 days after the end of each of the first
three fiscal quarters of each fiscal year of the Parent, its
consolidated balance sheet as of the end of such fiscal
quarter, the related statements of income for such fiscal
quarter and the then elapsed portion of the fiscal year and
the related statement of cash flows for the then elapsed
portion of the fiscal year, setting forth in each case in
comparative form the figures for the corresponding period or
periods of (or, in the case of the balance sheet, as of the
end of) the previous fiscal year, all certified by one of its
Financial Officers as presenting fairly in all material
respects the financial condition and results of operations of
the Parent and its consolidated Subsidiaries on a consolidated
basis in accordance with GAAP consistently applied, subject to
normal year-end audit adjustments and the absence of
footnotes;
(c) concurrently with any delivery of financial
statements under clause (a) or (b) above, a certificate of a
Financial Officer of the Borrower (i) certifying as to whether
a Default has occurred and is continuing and, if a Default has
occurred and is continuing, specifying the details thereof and
any action taken or proposed to be taken with respect thereto,
(ii) setting forth reasonably detailed calculations
demonstrating compliance with Sections 6.10 and 6.11 and (iii)
stating whether any change in GAAP or in
46
the application thereof has occurred since the date of the
previous delivery of financial statements under clause (a) or
(b) above;
(d) promptly after the same become publicly
available, copies of all periodic and other reports, proxy
statements and other materials publicly filed by the Parent,
the Borrower or any Subsidiary with the Securities and
Exchange Commission, or any Governmental Authority succeeding
to any or all of the functions of said Commission, or with any
national securities exchange, or distributed by the Parent or
the Borrower to its shareholders generally, as the case may
be; and
(e) promptly following any request therefor, such
other information regarding the operations, business affairs
and financial condition of the Parent, the Borrower or any
Subsidiary, or compliance with the terms of this Agreement, as
the Administrative Agent or any Lender may reasonably request;
PROVIDED that if no Loans are outstanding hereunder, the
requests of Lenders under this Section 5.01(e) shall be
subject to the approval of the Administrative Agent.
Section 5.02. NOTICES OF MATERIAL EVENTS. The Borrower will
furnish to the Administrative Agent and each Lender prompt written notice of the
following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or
proceeding by or before any arbitrator or Governmental
Authority against or affecting the Borrower or any Affiliate
thereof that could reasonably be expected to be adversely
determined in a manner that would result in a Material Adverse
Effect;
(c) the occurrence of any ERISA Event that, alone or
together with any other ERISA Events that have occurred, could
reasonably be expected to result in a Material Adverse Effect;
and
(d) any other development that results in, or could
reasonably be expected to result in, a Material Adverse
Effect.
Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.
Section 5.03. EXISTENCE; CONDUCT OF BUSINESS. Each of the
Parent and the Borrower will, and will cause each of the Subsidiaries to, do or
cause to be done all things necessary to preserve, renew and keep in full force
and effect its legal existence and the rights, licenses, permits, privileges and
franchises material to the conduct of the business of the Parent, the Borrower
and the Subsidiaries, taken as a whole; PROVIDED that
47
the foregoing shall not prohibit any merger, consolidation, liquidation or
dissolution permitted under Section 6.04.
Section 5.04. PAYMENT OF OBLIGATIONS. Each of the Parent and
the Borrower will, and will cause each of the Subsidiaries to, pay its
obligations, including Tax liabilities, that, if not paid, could result in a
Material Adverse Effect before the same shall become delinquent or in default,
except where (a) the validity or amount thereof is being contested in good faith
by appropriate proceedings, (b) the Parent, the Borrower or such Subsidiary has
set aside on its books adequate reserves with respect thereto in accordance with
GAAP and (c) the failure to make payment pending such contest could not
reasonably be expected to result in a Material Adverse Effect.
Section 5.05. MAINTENANCE OF PROPERTIES; INSURANCE. Each of
the Parent and the Borrower will, and will cause each of the Subsidiaries to,
(a) keep and maintain all property material to the conduct of its business in
good working order and condition, ordinary wear and tear excepted, and (b)
maintain, with financially sound and reputable insurance companies, insurance in
such amounts and against such risks as are customarily maintained by companies
engaged in the same or similar businesses operating in the same or similar
locations.
Section 5.06. BOOKS AND RECORDS; INSPECTION RIGHTS. Each of
the Parent and the Borrower will, and will cause each of the Subsidiaries to,
keep proper books of record and account in which full, true and correct entries
are made of all dealings and transactions in relation to its business and
activities. Each of the Parent and the Borrower will, and will cause each of the
Subsidiaries to, permit any representatives designated by the Administrative
Agent or any Lender, upon reasonable prior notice and at such party's expense,
to visit and inspect its properties, to examine and make extracts from its books
and records, and to discuss its affairs, finances and condition with its
officers and, if an Event of Default exists, its independent accountants. Such
visits and inspections shall be arranged through the Administrative Agent and
shall not occur more than once in any fiscal quarter unless an Event of Default
shall exist.
Section 5.07. COMPLIANCE WITH LAWS. Each of the Parent and the
Borrower will, and will cause each of the Subsidiaries to, comply with all laws,
rules, regulations and orders of any Governmental Authority applicable to it or
its property, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect.
Section 5.08. USE OF PROCEEDS AND LETTERS OF CREDIT. The
proceeds of the Loans will be used only for working capital, capital
expenditures and other general corporate purposes. No part of the proceeds of
any Loan will be used, whether directly or indirectly, for any purpose that
entails a violation of any of the Regulations of the Board, including
Regulations T, U and X. Letters of Credit will be issued only to support import
or other needs in the ordinary course of business.
Section 5.09. ADDITIONAL SUBSIDIARIES; GUARANTEE REQUIREMENT.
(a) If any additional US Subsidiary is formed or acquired after the Effective
Date, the Parent or
48
the Borrower (as the case may be) will notify the Administrative Agent thereof
within 30 days.
(b) The Parent or the Borrower (as the case may be) will
promptly cause any US Subsidiary that is not then a Guarantor to become a party
to the Guarantee Agreement within 30 days of the acquisition or creation of such
US Subsidiary.
ARTICLE VI
NEGATIVE COVENANTS
Until the Commitments have expired or terminated and the
principal of and interest on each Loan and all fees payable hereunder have been
paid in full and all Letters of Credit have expired or terminated and all LC
Disbursements shall have been reimbursed, each of the Parent and the Borrower
covenants and agrees with the Lenders that:
Section 6.01. INDEBTEDNESS. The Parent and the Borrower will
not, and will not permit any Subsidiary to, create, incur, assume or permit to
exist any Indebtedness, except:
(a) Indebtedness created under the Loan Documents;
(b) Indebtedness existing on the date hereof and (in
the case of any such Indebtedness in a principal amount in
excess of $1,000,000) set forth in Schedule 6.01 and
extensions, renewals and replacements of any such Indebtedness
that do not increase the outstanding principal amount thereof;
(c) Indebtedness (i) resulting from any loan or
advance by a Loan Party to another Loan Party, (ii) resulting
from any loan or advance by a Subsidiary that is not a Loan
Party to a Loan Party, (iii) resulting from any loan or
advance by any Subsidiary that is not a Loan Party to any
other Subsidiary that is not a Loan Party and (iv) resulting
from any loan or advance by any Loan Party to any Subsidiary
that is not a Loan Party; PROVIDED that the aggregate
outstanding principal amount of the Indebtedness permitted
solely by this subclause (iv) shall not exceed in the
aggregate for all Loan Parties at any time $20,000,000 less
the amount by which the aggregate principal amount of
outstanding Indebtedness of Subsidiaries that are not Loan
Parties permitted under clause (g) below exceeds $5,000,000;
(d) Indebtedness of the Parent, the Borrower or any
Subsidiary incurred to finance the acquisition, construction
or improvement of any fixed or capital assets, including
Capital Lease Obligations and any Indebtedness assumed in
connection with the acquisition of any such assets or secured
by a Lien on any such assets prior to the acquisition
49
thereof, and extensions, renewals and replacements of any such
Indebtedness that do not increase the outstanding principal
amount thereof; PROVIDED that such Indebtedness is incurred
prior to or within 90 days after such acquisition or the
completion of such construction or improvement;
(e) Indebtedness of any Person that becomes a
Subsidiary after the date hereof; PROVIDED that (i) such
Indebtedness exists at the time such Person becomes a
Subsidiary and is not created in contemplation of or in
connection with such Person becoming a Subsidiary and (ii) the
aggregate principal amount of Indebtedness permitted by this
clause (e) shall not exceed $20,000,000 at any time
outstanding; and
(f) other unsecured Indebtedness of the Parent, the
Borrower and the Subsidiaries in an aggregate amount not
exceeding $50,000,000 at any time outstanding; PROVIDED that
such Indebtedness, as permitted under this Section 6.01(f),
may not be comprised of obligations in respect of letters of
credit.
Section 6.02. LIENS. The Parent and the Borrower will not, and
will not permit any Subsidiary to, create, incur, assume or permit to exist any
Lien on any property or asset now owned or hereafter acquired by it, or assign
or sell any income or revenues (including accounts receivable) or rights in
respect of any thereof, except:
(a) Permitted Encumbrances;
(b) any Lien on any property or asset of the Parent,
the Borrower or any Subsidiary existing on the date hereof and
(in the case of any Lien securing obligations in an aggregate
amount in excess of $1,000,000) set forth in Schedule 6.02;
PROVIDED that (i) such Lien shall not apply to any other
property or asset of the Parent, Borrower or any Subsidiary
and (ii) such Lien shall secure only those obligations which
it secures on the date hereof and extensions, renewals and
replacements thereof that do not increase the outstanding
principal amount thereof;
(c) any Lien existing on any property or asset prior
to the acquisition thereof by the Parent, the Borrower or any
Subsidiary or existing on any property or asset of any Person
that becomes a Subsidiary after the date hereof prior to the
time such Person becomes a Subsidiary; PROVIDED that (i) such
Lien is not created in contemplation of or in connection with
such acquisition or such Person becoming a Subsidiary, (ii)
such Lien shall not apply to any other property or assets of
the Parent, the Borrower or any Subsidiary and (iii) such Lien
shall secure only those obligations which it secures on the
date of such acquisition or the date such Person becomes a
Subsidiary and extensions, renewals and replacements thereof
that do not increase the outstanding principal amount thereof;
50
(d) Liens on fixed or capital assets acquired,
constructed or improved by the Parent, the Borrower or any
Subsidiary; PROVIDED that (i) such security interests secure
Indebtedness permitted by clause (d) of Section 6.01, (ii)
such security interests and the Indebtedness secured thereby
are incurred prior to or within 90 days after such acquisition
or the completion of such construction or improvement, (iii)
the Indebtedness secured thereby does not exceed the cost of
acquiring, constructing or improving such fixed or capital
assets and (iv) such security interests shall not apply to any
other property or assets of the Parent, the Borrower or any
Subsidiary;
(e) Liens of sellers of goods to the Borrower and its
Subsidiaries arising under Article 2 of the Uniform Commercial
Code or similar provisions of applicable law in the ordinary
course of business, covering only the goods sold and securing
only the unpaid purchase price for such goods and related
expenses; and
(f) Liens on raw materials and inventory acquired in
the ordinary course of business securing obligations in
respect of Trade Letters of Credit issued hereunder.
Section 6.03. SALE-LEASEBACK TRANSACTIONS. The Parent and the
Borrower will not, and will not permit any Subsidiary to, enter into any
arrangement, directly or indirectly, with any Person whereby they shall sell or
transfer any property, real or personal, used or useful in their business,
whether now owned or hereafter acquired, and thereafter rent or lease such
property or other property which they intend to use for substantially the same
purpose or purposes as the property being sold or transferred; PROVIDED that the
Borrower, Parent or any Subsidiary may enter into a sale-leaseback transaction
prior to or within 180 days after the acquisition or completion of construction
of the property which is the subject of such sale-leaseback transaction.
Section 6.04. FUNDAMENTAL CHANGES. (a) The Parent and the
Borrower will not, and will not permit any Subsidiary to, merge into or
consolidate with any other Person, or permit any other Person to merge into or
consolidate with it, or sell, transfer, lease or otherwise dispose of (in one
transaction or in a series of transactions) all or any substantial part of its
assets, or all or substantially all of the stock of any Subsidiary (in each
case, whether now owned or hereafter acquired), or liquidate or dissolve, except
that, if at the time thereof and immediately after giving effect thereto no
Default shall have occurred and be continuing (i) any Person may merge into the
Parent or the Borrower in a transaction in which the Parent or the Borrower, as
the case may be, is the surviving corporation, (ii) any Person may merge into
any Subsidiary in a transaction in which the surviving entity is a Subsidiary,
(iii) any Subsidiary may sell, transfer, lease or otherwise dispose of its
assets to the Parent, the Borrower or another Loan Party, (iv) any disposition
of assets constituting an investment permitted by Section 6.05(c) shall be
permitted and (v) any Subsidiary may liquidate or dissolve if the Borrower or
the Parent (as the case may be) determines in good faith that such liquidation
or dissolution is in the best interests of the Borrower or the Parent (as the
case may be) and is not materially
51
disadvantageous to the Lenders; PROVIDED that any such merger involving a Person
that is not a wholly owned Subsidiary immediately prior to such merger shall not
be permitted unless also permitted by Section 6.05.
(b) The Parent and the Borrower will not, and will not permit
any Subsidiary to, engage to any material extent in any business other than
businesses of the type conducted by the Parent, the Borrower and the
Subsidiaries on the date of execution of this Agreement and businesses
reasonably related or incidental thereto.
Section 6.05. INVESTMENTS, LOANS, ADVANCES, GUARANTEES AND
ACQUISITIONS. The Parent and the Borrower will not, and will not permit any
Subsidiary to, purchase, hold or acquire (including pursuant to any merger with
any Person that was not a wholly owned Subsidiary prior to such merger) any
capital stock, evidences of indebtedness or other securities (including any
option, warrant or other right to acquire any of the foregoing) of, make or
permit to exist any loans or advances to, Guarantee any obligations of, or make
or permit to exist any investment or any other interest in, any other Person, or
purchase or otherwise acquire (in one transaction or a series of transactions)
any assets of any other Person constituting a business unit, except: (a)
Permitted Investments;
(b) investments by the Parent, the Borrower or any
Subsidiary that is a Guarantor in the Parent, the Borrower or
any such Subsidiary;
(c) additional purchases of or investments by the
Parent, the Borrower or any Subsidiary in the capital stock of
Subsidiaries, joint ventures or the capital stock, assets,
obligations or other securities of or interest in other
Persons in an amount in the aggregate at any time outstanding
which does not exceed 15% of consolidated shareholders' equity
of the Parent;
(d) Indebtedness permitted by clause (c) of Section
6.01;
(e) Guarantees of Indebtedness of any Loan Party
permitted by Section 6.01.
(f) loans and advances to officers and directors of
any Loan Party (or employees thereof provided such loans and
advances are approved by an officer of a Loan Party) for
travel, entertainment and relocation expenses in the ordinary
course of business in an aggregate principal amount
outstanding at any time that shall not exceed $1,000,000; and
(g) an existing loan in the current principal amount
of $4,953,833 to the chairman of the board of the Parent;
PROVIDED, that such loan shall not be permitted to continue to
exist after December 31, 2002.
Section 6.06. SWAP AGREEMENTS. The Borrower will not, and will
not permit any of its Subsidiaries to, enter into any Swap Agreement, except (a)
Swap
52
Agreements entered into to hedge or mitigate risks to which the Borrower or
any Subsidiary has actual exposure (other than those in respect of Equity
Interests of the Borrower or any of its Subsidiaries), and (b) Swap Agreements
entered into in order to effectively cap, collar or exchange interest rates
(from fixed to floating rates, from one floating rate to another floating rate
or otherwise) with respect to any interest-bearing liability or investment of
the Borrower or any Subsidiary; PROVIDED that the Swap Agreements permitted by
this Section 6.06 may only be provided by (i) a domestic office of any
commercial bank organized under the laws of the United States of America or any
State thereof which has a combined capital and surplus and undivided profits of
not less than $100,000,000, (ii) any Lender or (iii) a foreign banking
institution or foreign branch of a domestic commercial bank the long-term debt
of which (or of its holding company in the case of a domestic bank) is rated at
least A- by S&P and A3 by Xxxxx'x; PROVIDED FURTHER that all Swap Agreements
permitted by this Section 6.06 must conform to the standards set forth in an
ISDA master agreement.
Section 6.07. RESTRICTED PAYMENTS. The Parent and the Borrower
will not, and will not permit any Subsidiary to, declare or make, or agree to
pay or make, directly or indirectly, any Restricted Payment, except (a) the
Parent and the Borrower may declare and pay dividends with respect to its Equity
Interests payable solely in additional shares of its common stock; (b) if no
Default has occurred and is continuing, the Parent may declare and pay and, if
declared when no Default exists, the Borrower may pay, dividends in cash in a
cumulative aggregate amount for all such dividends declared after the date
hereof not to exceed 20% of Consolidated Net Income for the period from February
2, 2002 through the end of the most recently ended fiscal quarter of the Parent
(considered as a single accounting period); (c) Subsidiaries may (i) declare and
pay dividends or make distributions ratably with respect to their Equity
Interests and (ii) may make Restricted Payments to the Parent, and other
Subsidiaries of the Parent, in amounts necessary to enable the Parent to pay the
dividends described in clause (b) above, along with standard costs associated
with such payment of dividends or distributions, and to pay taxes and operating
and professional expenses; (d) the Parent, the Borrower and the Subsidiaries may
make Restricted Payments pursuant to and in accordance with employment
contracts, stock option plans or other benefit plans or similar arrangements for
consultants, management (including directors and officers) or employees of the
Parent, the Borrower and the Subsidiaries; (e) so long as no Default or Event of
Default shall exist, the Parent and the Borrower may (i) repurchase fractional
shares of common stock of the Parent and (ii) repurchase shares of common stock
of the Parent for cash ; PROVIDED that the aggregate number of shares
repurchased under this clause (ii) may not, during the lifetime of this
Agreement, exceed 5,000,000 (adjusted appropriately for stock splits, stock
dividends, reverse splits, combinations or similar transactions); PROVIDED
FURTHER that the aggregate purchase price for all such repurchases in any given
fiscal year of the Borrower may not exceed 40% of Consolidated Net Income for
such fiscal year (it being understood that all purchases of shares of common
stock on the open market shall be subject to the limitations set out in the
provisos to this clause (e) and are not separately permitted by clause (d)
above); and (f) any declaration of a dividend in connection with a stockholders'
rights plan, or the issuance of rights,
53
stock or other property under any stockholders' rights plan, or the redemption
or repurchase of rights pursuant thereto.
Section 6.08. TRANSACTIONS WITH AFFILIATES. The Parent and the
Borrower will not, and will not permit any Subsidiary to, sell, lease or
otherwise transfer any property or assets to, or purchase, lease or otherwise
acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates, except (a) in the ordinary course of
business at prices and on terms and conditions not less favorable to the Parent
and the Borrower or such Subsidiary than could be obtained on an arm's-length
basis from unrelated third parties, (b) transactions between or among the
Parent, the Borrower and their wholly owned Subsidiaries, not involving any
other Affiliate and (c) any Restricted Payment permitted by Section 6.07.
Section 6.09. RESTRICTIVE AGREEMENTS. The Parent and the
Borrower will not, and will not permit any Subsidiary to, directly or
indirectly, enter into, incur or permit to exist any agreement or other
arrangement that prohibits, restricts or imposes any condition upon (a) the
ability of the Parent, the Borrower or any Subsidiary to create, incur or permit
to exist any Lien upon any of its property or assets, or (b) the ability of any
Subsidiary to pay dividends or other distributions with respect to any shares of
its capital stock or to make or repay loans or advances to the Parent, the
Borrower or any other Subsidiary or to Guarantee Indebtedness of the Parent, the
Borrower or any other Subsidiary; PROVIDED that (i) the foregoing shall not
apply to restrictions and conditions imposed by law or by this Agreement, (ii)
the foregoing shall not apply to restrictions and conditions existing on the
date hereof identified on Schedule 6.09 (but shall apply to any amendment or
modification expanding the scope of any such restriction or condition), (iii)
the foregoing shall not apply to customary restrictions and conditions contained
in agreements relating to the sale of a Subsidiary pending such sale, provided
such restrictions and conditions apply only to the Subsidiary that is to be sold
and such sale is permitted hereunder, (iv) clause (a) of the foregoing shall not
apply to restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted by this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness and (v) clause
(a) of the foregoing shall not apply to customary provisions in leases and other
contracts restricting the assignment thereof.
Section 6.10. LEVERAGE RATIO. The Parent and the Borrower will
not permit the Leverage Ratio at the end of any fiscal quarter to be greater
than 3.50 to 1.00.
Section 6.11. COVERAGE RATIO. The Parent and the Borrower will
not permit the Coverage Ratio at the end of any fiscal quarter to be less 2.50
to 1.00.
Section 6.12. ACCOUNTING CHANGES. The Parent and the Borrower
will not, and will not permit any Subsidiary to, change its accounting policies
or practices from those utilized in the preparation of the financial statements
referred to in Section 3.04, except as permitted or required by GAAP
consistently applied.
54
ARTICLE VII
EVENTS OF DEFAULT
If any of the following events ("Events of Default") shall
occur:
(a) the Borrower shall fail to pay any principal of
any Loan or any reimbursement obligation in respect of any LC
Disbursement when and as the same shall become due and
payable, whether at the due date thereof or at a date fixed
for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on
any Loan or any fee or any other amount (other than an amount
referred to in clause (a) of this Article) payable under this
Agreement, when and as the same shall become due and payable,
and such failure shall continue unremedied for a period of
three Business Days;
(c) any representation or warranty made or deemed
made by or on behalf of the Parent, the Borrower or any
Subsidiary in this Agreement or any amendment or modification
hereof or waiver hereunder, or in any report, certificate,
financial statement or other document furnished pursuant to
this Agreement or any amendment or modification hereof or
waiver hereunder, shall prove to have been incorrect in any
material respect when made or deemed made;
(d) the Parent or the Borrower shall fail to observe
or perform any covenant, condition or agreement contained in
Section 5.02(a), 5.03 (with respect to the Borrower's
existence) or 5.08 or in Article VI;
(e) the Parent or the Borrower shall fail to observe
or perform any covenant, condition or agreement contained in
this Agreement (other than those specified in clause (a), (b)
or (d) of this Article), and such failure shall continue
unremedied for a period of 30 days after notice thereof from
the Administrative Agent to the Borrower (which notice will be
given at the request of any Lender);
(f) any Loan Party shall fail to make any payment
(whether of principal or interest and regardless of amount) in
respect of any Material Indebtedness, when and as the same
shall become due and payable and after giving effect to up to
the first 30 days of any grace periods applicable thereto;
(g) any event or condition occurs that results in any
Material Indebtedness becoming due prior to its scheduled
maturity or that enables or permits the holder or holders of
any Material Indebtedness or any trustee or agent on its or
their behalf to cause any Material Indebtedness to become due,
or to require the prepayment, repurchase, redemption or
defeasance thereof, prior to its scheduled maturity; PROVIDED
that this
55
clause (g) shall not apply to secured Indebtedness that
becomes due as a result of the voluntary sale or transfer of
the property or assets securing such Indebtedness;
(h) an involuntary proceeding shall be commenced or
an involuntary petition shall be filed seeking (i)
liquidation, reorganization or other relief in respect of the
Parent, the Borrower or any Material Subsidiary or its debts,
or of a substantial part of its assets, under any Federal,
state or foreign bankruptcy, insolvency, receivership or
similar law now or hereafter in effect or (ii) the appointment
of a receiver, trustee, custodian, sequestrator, conservator
or similar official for the Parent, the Borrower or any
Material Subsidiary or for a substantial part of its assets,
and, in any such case, such proceeding or petition shall
continue undismissed for 60 days or an order or decree
approving or ordering any of the foregoing shall be entered;
(i) the Parent, the Borrower or any Material
Subsidiary shall (i) voluntarily commence any proceeding or
file any petition seeking liquidation, reorganization or other
relief under any Federal, state or foreign bankruptcy,
insolvency, receivership or similar law now or hereafter in
effect, (ii) consent to the institution of any proceeding or
petition described in clause (h) of this Article, (iii) apply
for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for
the Parent, the Borrower or any Material Subsidiary or for a
substantial part of its assets, (iv) file an answer admitting
the material allegations of a petition filed against it in any
such proceeding, (v) make a general assignment for the benefit
of creditors or (vi) take any corporate action for the purpose
of effecting any of the foregoing;
(j) the Parent, the Borrower or any Material
Subsidiary shall become unable, admit in writing or fail
generally to pay its debts as they become due;
(k) one or more judgments for the payment of money in
an aggregate amount in excess of $10,000,000 (net of any
insurance coverage available therefor from a responsible
insurance company that is not denying its liability with
respect thereto) shall be rendered against the Parent, the
Borrower, any Subsidiary or any combination thereof and the
same shall remain undischarged for a period of 30 consecutive
days during which execution shall not be effectively stayed,
or any action shall be legally taken by a judgment creditor to
attach or levy upon any assets of the Parent, the Borrower or
any Subsidiary to enforce any such judgment;
(l) an ERISA Event shall have occurred that, in the
opinion of the Required Lenders, when taken together with all
other ERISA Events that have occurred, could reasonably be
expected to result in a Material Adverse Effect;
56
(m) any Guarantee of any Guarantor under the
Guarantee Agreement shall cease to be (other than pursuant to
the terms of the Guarantee Agreement), or shall be asserted by
any Loan Party not to be, a legal, valid and binding
obligation of such Guarantor, other than as a result of an
event generally described in any of clauses (h), (i) or (j)
above with respect to a Subsidiary that is not a Material
Subsidiary; or
(n) a Change in Control shall occur;
then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, take either or
both of the following actions, at the same or different times: (i) terminate the
Commitments, and thereupon the Commitments shall terminate immediately, and (ii)
declare the Loans then outstanding to be due and payable in whole (or in part,
in which case any principal not so declared to be due and payable may thereafter
be declared to be due and payable), and thereupon the principal of the Loans so
declared to be due and payable, together with accrued interest thereon and all
fees and other obligations of the Borrower accrued hereunder, shall become due
and payable immediately, without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Borrower; and in case of any
event with respect to the Borrower described in clause (h) or (i) of this
Article, the Commitments shall automatically terminate and the principal of the
Loans then outstanding, together with accrued interest thereon and all fees and
other obligations of the Borrower accrued hereunder, shall automatically become
due and payable, without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Borrower.
ARTICLE VIII
THE ADMINISTRATIVE AGENT
Each of the Lenders and the Issuing Bank hereby irrevocably
appoints the Administrative Agent as its agent and authorizes the Administrative
Agent to take such actions on its behalf and to exercise such powers as are
delegated to the Administrative Agent by the terms hereof, together with such
actions and powers as are reasonably incidental thereto.
The bank serving as the Administrative Agent hereunder shall
have the same rights and powers in its capacity as a Lender as any other Lender
and may exercise the same as though it were not the Administrative Agent, and
such bank and its Affiliates may accept deposits from, lend money to and
generally engage in any kind of business with the Borrower or any Subsidiary or
other Affiliate thereof as if it were not the Administrative Agent hereunder.
The Administrative Agent shall not have any duties or
obligations except those expressly set forth herein. Without limiting the
generality of the foregoing, (a) the Administrative Agent shall not be subject
to any fiduciary or other implied duties,
57
regardless of whether a Default has occurred and is continuing, (b) the
Administrative Agent shall not have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers
expressly contemplated hereby that the Administrative Agent is required to
exercise in writing as directed by the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02), and (c) except as expressly set forth herein, the
Administrative Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to the Parent, the
Borrower or any of the Subsidiaries that is communicated to or obtained by the
bank serving as Administrative Agent or any of its Affiliates in any capacity.
The Administrative Agent shall not be liable for any action taken or not taken
by it with the consent or at the request of the Required Lenders (or such other
number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02) or in the absence of its own gross
negligence or wilful misconduct. The Administrative Agent shall be deemed not to
have knowledge of any Default unless and until written notice thereof is given
to the Administrative Agent by the Borrower or a Lender, and the Administrative
Agent shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with this
Agreement, (ii) the contents of any certificate, report or other document
delivered hereunder or in connection herewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein, (iv) the validity, enforceability, effectiveness or genuineness of
this Agreement or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Article IV or elsewhere herein, other
than to confirm receipt of items expressly required to be delivered to the
Administrative Agent.
The Administrative Agent shall be entitled to rely upon, and
shall not incur any liability for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing believed
by it to be genuine and to have been signed or sent by the proper Person. The
Administrative Agent also may rely upon any statement made to it orally or by
telephone and believed by it to be made by the proper Person, and shall not
incur any liability for relying thereon. The Administrative Agent may consult
with legal counsel (who may be counsel for the Borrower), independent
accountants and other experts selected by it, and shall not be liable for any
action taken or not taken by it in accordance with the advice of any such
counsel, accountants or experts.
The Administrative Agent may perform any and all of its duties
and exercise its rights and powers by or through any one or more sub-agents
appointed by the Administrative Agent. The Administrative Agent and any such
sub-agent may perform any and all of its duties and exercise its rights and
powers through their respective Related Parties. The exculpatory provisions of
the preceding paragraphs shall apply to any such sub-agent and to the Related
Parties of the Administrative Agent and any such sub-agent, and shall apply to
their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.
Subject to the appointment and acceptance of a successor
Administrative Agent as provided in this paragraph, the Administrative Agent may
resign at any time by
58
notifying the Lenders, the Issuing Bank and the Borrower. Upon any such
resignation, the Required Lenders shall have the right, in consultation with the
Borrower, to appoint a successor. If no successor shall have been so appointed
by the Required Lenders and shall have accepted such appointment within 30 days
after the retiring Administrative Agent gives notice of its resignation, then
the retiring Administrative Agent may, on behalf of the Lenders and the Issuing
Bank, appoint a successor Administrative Agent. Upon the acceptance of its
appointment as Administrative Agent hereunder by a successor, such successor
shall succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations hereunder. The fees
payable by the Borrower to a successor Administrative Agent shall be the same as
those payable to its predecessor unless otherwise agreed between the Borrower
and such successor. After the Administrative Agent's resignation hereunder, the
provisions of this Article and Section 9.03 shall continue in effect for the
benefit of such retiring Administrative Agent, its sub-agents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while it was acting as Administrative Agent.
Each Lender acknowledges that it has, independently and
without reliance upon the Administrative Agent or any other Lender and based on
such documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any related agreement or any document furnished hereunder or thereunder.
ARTICLE IX
MISCELLANEOUS
Section 9.01. NOTICES. (a) Except in the case of notices and
other communications expressly permitted to be given by telephone (and subject
to paragraph (b) below), all notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by telecopy, as follows:
(i) if to the Borrower, to it at Abercrombie & Fitch
Management Co., 0000 Xxxxx Xxxx, Xxx Xxxxxx, Xxxx 00000,
Attention of Vice President and Chief Financial Officer
(Telecopy No. (000) 000-0000);
(ii) if to the Administrative Agent or the Swingline
Lender, to National City Bank, Agent Services Group, 000
Xxxxxx Xxxxxx, Xxxxxx Xxxxx, Xxxxxxxxx, Xxxx 00000, Attention
of Xxxxx Xxxxxxxx (Telecopy No. 216 222-0103), with a copy to
National City Bank, National Retailer Group, 000 Xxxx Xxxxx
Xxxxxx, Xxxxxxxx, Xxxx 00000 (Telecopy No. 614 463-8572); and
59
(iii) if to an Issuing Bank or any other Lender, to
it at its address (or telecopy number) set forth in its
Administrative Questionnaire.
(b) Notices and other communications to the Lenders hereunder
may be delivered or furnished by electronic communications pursuant to
procedures approved by the Administrative Agent; PROVIDED that the foregoing
shall not apply to notices pursuant to Article II unless otherwise agreed by the
Administrative Agent and the applicable Lender. The Administrative Agent or the
Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it; PROVIDED that approval of such procedures may be
limited to particular notices or communications.
(c) Any party hereto may change its address or telecopy number
for notices and other communications hereunder by notice to the other parties
hereto. All notices and other communications given to any party hereto in
accordance with the provisions of this Agreement shall be deemed to have been
given on the date of receipt.
Section 9.02. WAIVERS; AMENDMENTS. (a) No failure or delay by
the Administrative Agent, the Issuing Bank or any Lender in exercising any right
or power hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Administrative Agent, the Issuing Bank and the Lenders
hereunder are cumulative and are not exclusive of any rights or remedies that
they would otherwise have. No waiver of any provision of this Agreement or
consent to any departure by the Borrower therefrom shall in any event be
effective unless the same shall be permitted by paragraph (b) of this Section,
and then such waiver or consent shall be effective only in the specific instance
and for the purpose for which given. Without limiting the generality of the
foregoing, the making of a Loan or issuance of a Letter of Credit shall not be
construed as a waiver of any Default, regardless of whether the Administrative
Agent, any Lender or the Issuing Bank may have had notice or knowledge of such
Default at the time.
(b) Except as expressly provided in paragraph (c) of this
Section, neither this Agreement nor any provision hereof may be waived, amended
or modified except pursuant to an agreement or agreements in writing entered
into by the Borrower and the Required Lenders or by the Borrower and the
Administrative Agent with the consent of the Required Lenders; PROVIDED that no
such agreement shall (i) increase the Commitment of any Lender without the
written consent of such Lender, (ii) reduce the principal amount of any Loan or
LC Disbursement or reduce the rate of interest thereon, or reduce any fees
payable hereunder, without the written consent of each Lender affected thereby,
(iii) postpone the scheduled date of payment of the principal amount of any Loan
or LC Disbursement, or any interest thereon, or any fees payable hereunder, or
reduce the amount of, waive or excuse any such payment, or postpone the
scheduled date of expiration of any Commitment, without the written consent of
each Lender affected thereby, (iv) change Section 2.17(b) or (c) in a manner
that would alter the pro rata sharing of payments required thereby, without the
written consent of each Lender, (v)
60
release Parent or any Material Subsidiary from its Guarantee under the Guarantee
Agreement, without the written consent of each Lender or (vi) change any of the
provisions of this Section or the definition of "Required Lenders" or any other
provision hereof specifying the number or percentage of Lenders required to
waive, amend or modify any rights hereunder or make any determination or grant
any consent hereunder, without the written consent of each Lender; PROVIDED
FURTHER that no such agreement shall amend, modify or otherwise affect the
rights or duties of the Administrative Agent, the Issuing Bank or the Swingline
Lender hereunder without the prior written consent of the Administrative Agent
the Issuing Bank or the Swingline Lender, as the case may be.
(c) Notwithstanding anything in paragraph (b) of this Section
to the contrary, this Agreement and the other Loan Documents may be amended at
any time prior to the Maturity Date to increase the aggregate Commitments
pursuant to Section 2.19 of this Agreement.
Section 9.03. EXPENSES; INDEMNITY; DAMAGE WAIVER. (a) The
Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent and its Affiliates, including the reasonable fees, charges
and disbursements of counsel for the Administrative Agent, in connection with
the syndication of the credit facilities provided for herein, the preparation,
execution and delivery and administration of this Agreement or any amendments,
modifications or waivers of the provisions hereof (whether or not the
transactions contemplated hereby or thereby shall be consummated) and (ii)
reasonable all out-of-pocket expenses incurred by the Administrative Agent, the
Issuing Bank or any Lender, including the fees, charges and disbursements of any
counsel for the Administrative Agent, the Issuing Bank or any Lender, in
connection with the enforcement or protection of its rights in connection with
this Agreement, including its rights under this Section, or in connection with
the Loans made or Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during any workout or restructuring, or
negotiations in respect thereof, of such Loans or Letters of Credit and
documentary taxes associated with this Agreement.
(b) The Borrower shall indemnify the Administrative Agent, the
Issuing Bank and each Lender, and each Related Party of any of the foregoing
Persons (each such Person being called an "Indemnitee") against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities and
related expenses, including the reasonable fees, charges and disbursements of
any counsel for any Indemnitee, incurred by or asserted against any Indemnitee
arising out of, in connection with, or as a result of any actual or prospective
claim, litigation, investigation or proceedings relating to (i) the execution or
delivery of this Agreement or any agreement or instrument contemplated hereby,
the performance by the parties hereto of their respective obligations hereunder
or the consummation of the Transactions or any other transactions contemplated
hereby, (ii) any Loan or Letter of Credit or the use of the proceeds therefrom
(including any refusal by the Issuing Bank to honor a demand for payment under a
Letter of Credit if the documents presented in connection with such demand do
not strictly comply with the terms of such Letter of Credit), (iii) any actual
or alleged presence or release of Hazardous Materials on or from any property
owned or operated by the Borrower or
61
any of its Subsidiaries, or any Environmental Liability related in any way to
the Borrower or any of its Subsidiaries, whether based on contract, tort or any
other theory and regardless of whether any Indemnitee is a party thereto;
PROVIDED that such indemnity shall not, as to any Indemnitee, be available to
the extent that such losses, claims, damages, liabilities or related expenses
are determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or wilful misconduct of such
Indemnitee.
(c) To the extent that the Borrower fails to pay any amount
required to be paid by it to the Administrative Agent, the Issuing Bank or the
Swingline Lender under paragraph (a) or (b) of this Section, each Lender
severally agrees to pay to the Administrative Agent, the Issuing Bank or the
Swingline Lender, as the case may be, such Lender's Applicable Percentage
(determined as of the time that the applicable unreimbursed expense or indemnity
payment is sought) of such unpaid amount; PROVIDED that the unreimbursed expense
or indemnified loss, claim, damage, liability or related expense, as the case
may be, was incurred by or asserted against the Administrative Agent, the
Issuing Bank or the Swingline Lender in its capacity as such.
(d) To the extent permitted by applicable law, the Borrower
shall not assert, and hereby waives, any claim against any Indemnitee, on any
theory of liability, for special, indirect, consequential or punitive damages
(as opposed to direct or actual damages) arising out of, in connection with, or
as a result of, this Agreement or any agreement or instrument contemplated
hereby, the Transactions, any Loan or Letter of Credit or the use of the
proceeds thereof.
(e) All amounts due under this Section shall be payable
promptly after written demand therefor.
Section 9.04. SUCCESSORS AND ASSIGNS. (a) The provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns permitted hereby (including
any Affiliate of the Issuing Bank that issues any Letter of Credit), except that
(i) the Borrower may not assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of each Lender (and any
attempted assignment or transfer by the Borrower without such consent shall be
null and void) and (ii) no Lender may assign or otherwise transfer its rights or
obligations hereunder except in accordance with this Section. Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any Person
(other than the parties hereto, their respective successors and assigns
permitted hereby (including any Affiliate of the Issuing Bank that issues any
Letter of Credit), Participants (to the extent provided in paragraph (c) of this
Section) and, to the extent expressly contemplated hereby, the Related Parties
of each of the Administrative Agent, the Issuing Bank and the Lenders) any legal
or equitable right, remedy or claim under or by reason of this Agreement.
(b) (i) Subject to the conditions set forth in paragraph
(b)(ii) below, any Lender may assign to one or more assignees all or a portion
of its rights and obligations under this Agreement (including all or a portion
of its Commitment and the Loans at the
62
time owing to it), with the prior written consent (such consent not to be
unreasonably withheld) of:
(A) the Borrower, PROVIDED that no consent of the
Borrower shall be required for an assignment to a Lender or an
Affiliate of a Lender, or, if an Event of Default under clause
(a), (b), (h) or (i) of Article VII has occurred and is
continuing, any other assignee; and
(B) the Administrative Agent (and, in the case of an
assignment of all or a portion of any Lender's obligations in
respect of its LC Exposure, the Issuing Bank), provided that
no consent of the Administrative Agent or Issuing Bank, as the
case may be, shall be required for an assignment to an
assignee that is a Lender immediately prior to giving effect
to such assignment.
(ii) Assignments shall be subject to the following conditions:
(A) except in the case of an assignment to a Lender,
an Affiliate of a Lender or an Approved Fund or an assignment
of the entire remaining amount of the assigning Lender's
Commitment, the amount of the Commitment of the assigning
Lender subject to each such assignment (determined as of the
date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent) shall not
be less than $2,500,000 unless each of the Borrower and the
Administrative Agent otherwise consent, provided that no such
consent of the Borrower shall be required if an Event of
Default under clause (a), (b), (h) or (i) of Article VII has
occurred and is continuing;
(B) each partial assignment shall be made as an
assignment of a proportionate part of all the assigning
Lender's rights and obligations under this Agreement;
(C) the parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and
Assumption, together with a processing and recordation fee of
$3,500; and
(D) the assignee, if it shall not be a Lender, shall
deliver to the Administrative Agent an Administrative
Questionnaire
(iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) of this Section, from and after the effective date specified
in each Assignment and Assumption the assignee thereunder shall be a party
hereto and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender's rights and obligations under this Agreement, such
63
Lender shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 2.14, 2.15, 2.16 and 9.03). Any assignment or transfer by a
Lender of rights or obligations under this Agreement that does not comply with
this Section 9.04 shall be treated for purposes of this Agreement as a sale by
such Lender of a participation in such rights and obligations in accordance with
paragraph (c) of this Section.
(iv) The Administrative Agent, acting for this purpose as an
agent of the Borrower, shall maintain at one of its offices a copy of each
Assignment and Assumption delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Commitment of, and principal
amount of the Loans and LC Disbursements owing to, each Lender pursuant to the
terms hereof from time to time, which register shall indicate that each lender
is entitled to interest paid with respect to such Loans and LC Disbursements
(the "REGISTER"). The entries in the Register shall, in the absence of manifest
error, be conclusive, and the Borrower, the Administrative Agent, the Issuing
Bank and the Lenders may treat each Person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all purposes of
this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower, the Issuing Bank and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and
Assumption executed by an assigning Lender and an assignee, the assignee's
completed Administrative Questionnaire (unless the assignee shall already be a
Lender hereunder), the processing and recordation fee referred to in paragraph
(b) of this Section and any written consent to such assignment required by
paragraph (b) of this Section, the Administrative Agent shall accept such
Assignment and Assumption and record the information contained therein in the
Register. No assignment shall be effective for purposes of this Agreement unless
it has been recorded in the Register as provided in this paragraph.
(c) (i) Any Lender may, without the consent of the Borrower,
the Administrative Agent, the Issuing Bank or the Swingline Lender, sell
participations to one or more banks or other entities (a "Participant") in all
or a portion of such Lender's rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans owing to it);
PROVIDED that (A) such Lender's obligations under this Agreement shall remain
unchanged, (B) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (C) the Borrower, the
Administrative Agent, the Issuing Bank and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; PROVIDED
that such agreement or instrument may provide that such Lender will not, without
the consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to Section 9.02(b) that affects such Participant.
Subject to paragraph (c)(ii) of this Section, the Borrower agrees that each
Participant shall be entitled to the benefits of Sections 2.14, 2.15 and 2.16 to
the
64
same extent as if it were a Lender and had acquired its interest by
assignment pursuant to paragraph (b) of this Section; provided that Section
2.18(b) shall apply to any Participant to such extent. To the extent permitted
by law, each Participant also shall be entitled to the benefits of Section 9.08
as though it were a Lender, provided such Participant agrees to be subject to
Section 2.17(c) as though it were a Lender.
(ii) A Participant shall not be entitled to receive any
greater payment under Section 2.14 or 2.16 than the applicable Lender would have
been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made
with the Borrower's prior written consent. A Participant that would be a Foreign
Lender if it were a Lender shall not be entitled to the benefits of Section 2.16
unless the Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Borrower, to comply with
Section 2.16(e) as though it were a Lender.
(d) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement to secure
obligations of such Lender, including without limitation any pledge or
assignment to secure obligations to a Federal Reserve Bank, and this Section
shall not apply to any such pledge or assignment of a security interest;
PROVIDED that no such pledge or assignment of a security interest shall release
a Lender from any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto.
Section 9.05. SURVIVAL. All covenants, agreements,
representations and warranties made by the Borrower herein and in the
certificates or other instruments delivered in connection with or pursuant to
this Agreement shall be considered to have been relied upon by the other parties
hereto and shall survive the execution and delivery of this Agreement and the
making of any Loans and issuance of any Letters of Credit, regardless of any
investigation made by any such other party or on its behalf and notwithstanding
that the Administrative Agent, the Issuing Bank or any Lender may have had
notice or knowledge of any Default or incorrect representation or warranty at
the time any credit is extended hereunder, and shall continue in full force and
effect as long as the principal of or any accrued interest on any Loan or any
fee or any other amount payable under this Agreement is outstanding and unpaid
or any Letter of Credit is outstanding and so long as the Commitments have not
expired or terminated. The provisions of Sections 2.14, 2.15, 2.16 and 9.03 and
Article VIII shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.
Section 9.06. COUNTERPARTS; INTEGRATION; EFFECTIVENESS. This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract. This Agreement and
any separate letter agreements with respect to fees payable to the
Administrative Agent or the Issuing Bank constitute the entire contract among
the parties relating to
65
the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Except
as provided in Section 4.01, this Agreement shall become effective when it shall
have been executed by the Administrative Agent and when the Administrative Agent
shall have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Delivery of an executed counterpart of a signature page
of this Agreement by telecopy shall be effective as delivery of a manually
executed counterpart of this Agreement.
Section 9.07. SEVERABILITY. Any provision of this Agreement
held to be invalid, illegal or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such invalidity, illegality
or unenforceability without affecting the validity, legality and enforceability
of the remaining provisions hereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.
Section 9.08. RIGHT OF SETOFF. If (i) an Event of Default
shall have occurred and be continuing and (ii) the Required Lenders shall have
requested the Administrative Agent to declare the Loans to be immediately due
and payable pursuant to Article VII, or the Loans have become immediately due
and payable without notice as provided in Article VII, each Lender and each of
its Affiliates is hereby authorized at any time and from time to time, 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 and
other obligations at any time owing by such Lender or Affiliate to or for the
credit or the account of the Borrower against any of and all the obligations of
the Borrower now or hereafter existing under this Agreement held by such Lender,
irrespective of whether or not such Lender shall have made any demand under this
Agreement and although such obligations may be unmatured. The rights of each
Lender under this Section are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have.
Section 9.09. GOVERNING LAW; SUBMISSION TO JURISDICTION;
VENUE; CONSENT TO SERVICE OF PROCESS. (a) THIS AGREEMENT AND THE OTHER CREDIT
DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER
SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF
OHIO, TO THE FULLEST EXTENT PERMITTED BY LAW, THE BORROWER HEREBY
UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY
JURISDICTION OTHER THAN THE STATE OF OHIO GOVERNS THIS AGREEMENT OR ANY OF THE
OTHER CREDIT DOCUMENTS. Any legal action or proceeding with respect to this
Agreement or any other Loan Document may be brought in the Court of Common Pleas
of Cuyahoga County, Ohio, or of the United States for the Northern District of
Ohio, and, by execution and delivery of this Agreement, the Borrower hereby
irrevocably accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. The Borrower hereby
further irrevocably consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the mailing of copies
thereof
66
by registered or certified mail, postage prepaid, to such Borrower at
its address for notices pursuant to section 9.01, such service to become
effective 30 days after such mailing or at such earlier time as may be provided
under applicable law. Nothing herein shall affect the right of the
Administrative Agent or any Lender to serve process in any other manner
permitted by law or to commence legal proceedings or otherwise proceed against
any Borrower in any other jurisdiction.
(b) The Borrower hereby irrevocably waives any objection which
it may now or hereafter have to the laying of venue of any of the aforesaid
actions or proceedings arising out of or in connection with this Agreement or
any other Loan Document brought in the courts referred to in paragraph (a) above
and hereby further irrevocably waives and agrees not to plead or claim in any
such court that any such action or proceeding brought in any such court has been
brought in an inconvenient forum. Each party to this Agreement irrevocably
consents to service of process in the manner provided for notices in Section
9.01. Nothing in this Agreement will affect the right of any party to this
Agreement to serve process in any other manner permitted by law.
Section 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
Section 9.11. HEADINGS. Article and Section headings and the
Table of Contents used herein are for convenience of reference only, are not
part of this Agreement and shall not affect the construction of, or be taken
into consideration in interpreting, this Agreement.
Section 9.12. CONFIDENTIALITY. Each of the Administrative
Agent, the Issuing Bank and the Lenders agrees to maintain the confidentiality
of the Information (as defined below), except that Information may be disclosed
(a) to its and its Affiliates' directors, officers, employees and agents,
including accountants, legal counsel and other advisors (it being understood
that the Persons to whom such disclosure is made will be informed of the
confidential nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority, (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) to any other party to this Agreement, (e) in
connection with the exercise of any remedies hereunder or any suit, action or
proceeding relating to this Agreement or the enforcement of rights hereunder,
(f) subject to an agreement containing provisions
67
substantially the same as those of this Section, to any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement, (g) with the consent of the Borrower
or (h) to the extent such Information (i) becomes publicly available other than
as a result of a breach of this Section or (ii) becomes available to the
Administrative Agent, the Issuing Bank or any Lender on a nonconfidential basis
from a source other than the Borrower. For the purposes of this Section,
"Information" means all information received from the Borrower relating to the
Borrower or its business, other than any such information that is available to
the Administrative Agent, the Issuing Bank or any Lender on a nonconfidential
basis prior to disclosure by the Borrower. Any Person required to maintain the
confidentiality of Information as provided in this Section shall be considered
to have complied with its obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.
Section 9.13. INTEREST RATE LIMITATION. Notwithstanding
anything herein to the contrary, if at any time the interest rate applicable to
any Loan, together with all fees, charges and other amounts which are treated as
interest on such Loan under applicable law (collectively the "Charges"), shall
exceed the maximum lawful rate (the "Maximum Rate") which may be contracted for,
charged, taken, received or reserved by the Lender holding such Loan in
accordance with applicable law, the rate of interest payable in respect of such
Loan hereunder, together with all Charges payable in respect thereof, shall be
limited to the Maximum Rate and, to the extent lawful, the interest and Charges
that would have been payable in respect of such Loan but were not payable as a
result of the operation of this Section shall be cumulated and the interest and
Charges payable to such Lender in respect of other Loans or periods shall be
increased (but not above the Maximum Rate therefor) until such cumulated amount,
together with interest thereon at the Federal Funds Effective Rate to the date
of repayment, shall have been received by such Lender.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
ABERCROMBIE & FITCH MANAGEMENT CO.
by
/s/ Xxxxxx Xxxxxxxx
-------------------------------------
Name: Xxxxxx XxXxxxxx
Title: Vice President and Chief
Financial Officer
ABERCROMBIE & FITCH CO.,
by
68
/s/ Xxxxxx Xxxxxxxx
-------------------------------------
Name: Xxxxxx XxXxxxxx
Title: Vice President and Chief
Financial Officer
NATIONAL CITY BANK, individually and as
Administrative Agent,
by
/s/ Xxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
69
SIGNATURE PAGE TO
ABERCROMBIE & FITCH
MANAGEMENT CO.
CREDIT AGREEMENT
DATED AS OF NOVEMBER 14, 0000
XXXX XX XXXXXXX N.A.
by
/s/ Kipling X. Xxxxx
--------------------------------
Name: Kipling X. Xxxxx
Title: Vice President
CITIZENS BANK OF PENNSYLVANIA
by
/s/ Xxxx X. Xxxxxx, Xx.
--------------------------------
Name: Xxxx X. Xxxxxx, Xx.
Title: Vice President
COMPASS BANK
by
/s/ Xxxxx X. XxXxx
--------------------------------
Name: Xxxxx X. XxXxx
Title: Vice President
FIFTH THIRD BANK
by
/s/ Xxx Xxxxxx
--------------------------------
Name: Xxx Xxxxxx
Title: Large Corporate Accounts, Assistant Vice President
FLEET NATIONAL BANK
by
/s/ Xxxxxx X.X. Xxxxx
--------------------------------
Name: Xxxxxx X.X. Xxxxx
Title: Director
70
HIBERNIA NATIONAL BANK
by
/s/ Xxx St. Xxxx
--------------------------------
Name: Xxx St. Xxxx
Title: Senior Vice President & Manager U.S. Corporate
HUNTINGTON NATIONAL BANK.
by
/s/ Xxxxxxx X. Remins
--------------------------------
Name: Xxxxxxx X. Remins
Title: Vice President
JPMORGAN CHASE BANK
by
/s/ Xxxxx Xxxxxx
--------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
LASALLE BANK NATIONAL ASSOCIATION
by
/s/ Xxxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Commercial Loan Officer
NATIONAL CITY BANK
by
/s/ Xxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION
by
/s/ Xxxxxxx X. Xxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
THE BANK OF NEW YORK
by
/s/ Xxxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
00
XXX XXXXXXXXXXX XXXX, XXX XXXX BRANCH
by
/s/ Xxxxxxx Xxx
--------------------------------
Name: Xxxxxxx Xxx
Title: General Manager
U.S. BANK NATIONAL ASSOCIATION
by
/s/ Xxxxxx X. Friend
--------------------------------
Name: Xxxxxx X. Friend
Title: Vice President
