EXHIBIT 10.1
================================================================================
CREDIT AGREEMENT
$90,000,000
among
XXXXXXXXX CONTAINERS, INC.,
BWAY CORPORATION,
BWAY MANUFACTURING, INC.
and
XXXXXX CAN COMPANY, INC.
as Borrowers
with
BWAY CORPORATION,
as Funds Administrator
the Lenders,
and
BANKERS TRUST COMPANY,
as Agent
and
BANK OF AMERICA, N.A.,
as Documentation Agent
Dated as of May 22, 2001
[CONFORMED COPY INCLUDING AMENDMENT NO. 1]
================================================================================
i
TABLE OF CONTENTS
Page
----
ARTICLE 1 DEFINITIONS................................................. 1
1.1 General Definitions............................................. 1
1.2 Accounting Terms and Determinations............................. 25
1.3 Other Interpretive Provisions................................... 26
ARTICLE 2 LOANS....................................................... 26
2.1 Commitments; Delivery of Notes.................................. 26
2.2 Borrowing Mechanics............................................. 27
2.3 Settlements Among the Agents and the Lenders.................... 29
2.4 Mandatory Repayments: Mandatory Reduction of Commitments........ 30
2.5 Payments and Computations....................................... 31
2.6 Maintenance of Account.......................................... 32
2.7 Statement of Account............................................ 33
2.8 Withholding and Other Taxes..................................... 33
2.9 Affected Lenders................................................ 36
2.10 Sharing of Payments............................................. 37
2.11 Allocation of Loans and Expenses................................ 38
ARTICLE 3 LETTERS OF CREDIT........................................... 39
3.1 Letters of Credit............................................... 39
3.2 Maximum Letter of Credit Outstandings; Final Maturities......... 39
3.3 Letter of Credit Requests; Minimum Stated Amount................ 40
3.4 Letter of Credit Participations................................. 41
3.5 Agreement to Repay Letter of Credit Drawings.................... 42
3.6 Increased Costs................................................. 43
ARTICLE 4 INTEREST, FEES AND EXPENSES................................. 44
4.1 Interest on LIBOR Rate Loans.................................... 44
4.2 Interest on Prime Rate Loans.................................... 44
4.3 Notice of Continuation and Notice of Conversion................. 45
4.4 Interest After Event of Default................................. 47
4.5 Unused Line Fee................................................. 47
4.6 Letter of Credit Fees........................................... 47
4.7 Reimbursement of Expenses....................................... 48
4.8 Authorization to Charge Borrowers' Account...................... 48
4.9 Indemnification in Certain Events............................... 48
4.10 Calculations and Determinations................................. 49
ARTICLE 5 CONDITIONS PRECEDENT........................................ 49
5.1 Conditions to Initial Credit Event.............................. 49
5.2 Conditions to Each Credit Event................................. 50
ii
ARTICLE 6 REPRESENTATIONS AND WARRANTIES............................... 50
6.1 Organization and Qualification................................... 50
6.2 Solvency......................................................... 51
6.3 Rights in Collateral; Priority of Liens.......................... 51
6.4 No Conflict...................................................... 51
6.5 Enforceability................................................... 51
6.6 Consents......................................................... 51
6.7 Financial Data................................................... 52
6.8 Locations of Officers, Records and Inventory..................... 52
6.9 Fictitious Business Names........................................ 52
6.10 Subsidiaries..................................................... 52
6.11 No Judgments or Litigation....................................... 53
6.12 No Defaults...................................................... 53
6.13 Labor Matters.................................................... 53
6.14 Compliance with Law.............................................. 53
6.15 ERISA............................................................ 54
6.16 Intellectual Property............................................ 54
6.17 Licenses and Permits............................................. 54
6.18 Title to Property................................................ 54
6.19 Investment Company............................................... 54
6.20 Borrowers' Taxes and Tax Returns................................. 54
6.21 Status of Accounts............................................... 55
6.22 Material Contracts............................................... 56
6.23 Affiliate Transactions........................................... 56
6.24 Accuracy and Completeness of Information......................... 56
6.25 Recording Taxes.................................................. 56
6.26 No Adverse Change or Event....................................... 56
6.27 Additional Adverse Facts......................................... 56
ARTICLE 7 AFFIRMATIVE COVENANTS........................................ 57
7.1 Financial Information............................................ 57
7.2 Inventory........................................................ 59
7.3 Corporate Existence.............................................. 59
7.4 ERISA............................................................ 60
7.5 Books and Records................................................ 60
7.6 Collateral Records............................................... 61
7.7 Security Interests............................................... 61
7.8 Insurance; Casualty Loss......................................... 61
7.9 Borrower's Taxes................................................. 62
7.10 Compliance With Laws............................................. 62
7.11 Use of Proceeds.................................................. 63
7.12 Fiscal Year...................................................... 63
7.13 Notification of Certain Events................................... 63
7.14 Intellectual Property............................................ 64
7.15 Maintenance of Property.......................................... 64
7.16 Further Assurances............................................... 64
iii
7.17 Changes in Market.............................................. 64
ARTICLE 8 NEGATIVE COVENANTS......................................... 64
8.1 Consolidated Fixed Charge Coverage Ratio....................... 64
8.2 Capital Expenditures........................................... 65
8.3 No Additional Indebtedness..................................... 65
8.4 No Liens; Judgments............................................ 66
8.5 No Sale of Assets.............................................. 67
8.6 No Corporate Changes........................................... 67
8.7 No Guaranties.................................................. 68
8.8 No Restricted Payments......................................... 68
8.9 No Investments................................................. 68
8.10 No Affiliate Transactions...................................... 70
8.11 Limitation on Transactions Under ERISA......................... 70
8.12 No Additional Bank Accounts.................................... 71
8.13 Amendments of Material Contracts............................... 71
8.14 Additional Restrictive Covenants............................... 71
8.15 No Additional Subsidiaries..................................... 71
8.16 Limitation on Derivative Transactions.......................... 72
ARTICLE 9 EVENTS OF DEFAULT AND REMEDIES............................. 72
9.1 Events of Default.............................................. 72
9.2 Acceleration and Cash Collateralization........................ 74
9.3 Remedies....................................................... 75
ARTICLE 10 THE AGENT.................................................. 76
10.1 Appointment of Agent........................................... 76
10.2 Nature of Duties of Agent...................................... 76
10.3 Lack of Reliance on the Agent.................................. 76
10.4 Certain Rights of the Agent.................................... 77
10.5 Reliance by the Agent.......................................... 77
10.6 Indemnification of Agent....................................... 77
10.7 The Agent in its Individual Capacity........................... 78
10.8 Holders of Notes............................................... 78
10.9 Successor Agent................................................ 78
10.10 Collateral Matters............................................. 79
10.11 Actions with Respect to Defaults............................... 80
10.12 Delivery of Information........................................ 80
ARTICLE 11 MISCELLANEOUS.............................................. 81
11.1 SUBMISSION TO JURISDICTION; WAIVERS............................ 81
11.2 JURY TRIAL..................................................... 81
11.3 GOVERNING LAW.................................................. 82
11.4 Delays; Partial Exercise of Remedies........................... 82
11.5 Notices........................................................ 82
11.6 Assignability.................................................. 82
11.7 Confidentiality................................................ 85
iv
11.8 Indemnification............................................... 85
11.9 Entire Agreement; Successors and Assigns...................... 86
11.10 Amendments, Etc......................................... ..... 86
11.11 Nonliability of Agent and Lenders....................... ..... 87
11.12 Counterparts............................................ ..... 87
11.13 Effectiveness................................................. 87
11.14 Severability.................................................. 88
11.15 Headings Descriptive.......................................... 88
11.16 Maximum Rate.................................................. 88
11.17 Right of Setoff............................................... 88
11.18 Defaulting Lender............................................. 89
11.19 Rights Cumulative............................................. 90
11.20 Third Party Beneficiaries..................................... 90
11.21 Joint and Several Liability of Borrowers...................... 90
11.22 Appointment and Authorization of Funds Administrator.......... 91
v
ANNEXES
-------
ANNEX I Closing Document List
ANNEX II Lenders; Commitments; Lending Offices
EXHIBITS
--------
EXHIBIT A Form of Assignment and Assumption Agreement
EXHIBIT B Form of Note
EXHIBIT C Form of Notice of Borrowing
EXHIBIT C-1 Form of Notice of Continuation
EXHIBIT C-2 Form of Notice of Conversion
EXHIBIT D Form of Letter of Credit Request
EXHIBIT E Form of Compliance Certificate
EXHIBIT F Form of Borrowing Base Certificate
SCHEDULES
---------
SCHEDULE B, PART 6.1 Jurisdictions Qualified to Do Business
SCHEDULE B, PART 6.8 Principal Places of Business; Chief Executive
Offices; Locations of Books and Records; Other
Locations of Collateral
SCHEDULE B, PART 6.9 Fictitious Names
SCHEDULE B, PART 6.10 Subsidiaries
SCHEDULE B, PART 6.11 Outstanding Judgments; Orders; Waivers
SCHEDULE B, PART 6.14 Violations and Failures to Comply with
Requirements of Law; Environmental Matters
SCHEDULE B, PART 6.15 ERISA Matters
SCHEDULE B, PART 6.18 Real Estate
SCHEDULE B, PART 6.20 Tax Matters
SCHEDULE B, PART 6.22 Material Contracts
SCHEDULE B, PART 6.23 Affiliate Transactions
SCHEDULE B, PART 6.27 Additional Adverse Facts
SCHEDULE B, PART 8.3(e) Existing Indebtedness
SCHEDULE B, PART 8.4(b) Existing Liens
SCHEDULE B, PART 8.12 Payroll and Xxxxx Cash Accounts
vi
CREDIT AGREEMENT
Dated as of May 22, 2001
The Borrowers, the Funds Administrator, the Lenders and Bankers Trust
Company, as Agent, agree as follows (with certain terms used herein being
defined in Article 1):
ARTICLE 1
DEFINITIONS
-----------
1.1 General Definitions.
-------------------
As used herein, the following terms shall have the meanings herein specified:
"Accounts" shall mean, with respect to any Person, all of such Person's
--------
accounts, whether now existing or existing in the future, including, without
limitation, (i) all accounts receivable of such Person, including, without
limitation, all accounts of such Person created by or arising from the sales of
goods or rendition of services made by such Person under any of its trade names,
or through any of its divisions, (ii) all unpaid seller's rights of such Person
(including rescission, replevin, reclamation and stoppage in transit) relating
to the foregoing or arising therefrom, (iii) all rights of such Person to any
goods represented by any of the foregoing, including returned or repossessed
goods, (iv) all reserves and credit balances held by such Person with respect to
any such accounts receivable or account debtors and (v) all Guarantees or
collateral for any of the foregoing.
"Accumulated Funding Deficiency" shall have the meaning ascribed to that
------------------------------
term in Section 302 of ERISA.
"Acquisition" shall mean, with respect to any Borrower, any transaction or
-----------
series of related transactions for the purpose of, or resulting directly or
indirectly in, the acquisition by such Borrower of all or substantially all of
the assets of any other Person, or of any business or division of any other
Person.
"Acquisition Documents" shall mean those certain agreements set forth on
---------------------
Schedule 6.22 and designated thereon as "Acquisition Documents."
"Acquisition Target" shall mean a Person, or a business or division of a
------------------
Person, the assets of which are acquired in an Acquisition permitted under
Section 8.9(f).
"Adjusted LIBOR Rate" shall mean, for any Interest Period, the rate
-------------------
obtained by dividing (a) the LIBOR Rate for such Interest Period by (b) a
percentage equal to 1 minus the stated maximum rate (stated as a decimal) of all
-----
reserves, if any, required to be maintained against "Eurocurrency liabilities"
as specified in Regulation D (or against any other category of liabilities which
includes deposits by reference to which the interest rate on LIBOR Rate Loans is
determined or any category of extensions of credit or other assets which
includes loans by a non-United States office of any Lender to United States
residents).
"Affiliate" shall mean, with respect to any Person, any Person which
---------
directly or indirectly through one or more intermediaries Controls, is
Controlled by, or is under common Control with, such Person, or any Person who
is a director or officer of such Person or any Subsidiary of such Person.
"Agent" shall mean BTCo, acting in its capacity as contractual
-----
representative for the Lenders hereunder and any successor Agent appointed
pursuant to Section 10.9.
"Applicable Lending Office" shall mean, with respect to each Lender, such
-------------------------
Lender's LIBOR Lending Office in the case of a LIBOR Rate Loan, and such
Lender's Domestic Lending Office in the case of a Prime Rate Loan.
"Applicable Margin" shall mean, at any time with respect to any LIBOR Rate
-----------------
Loan or Prime Rate Loan, as the case may be, a percentage per annum equal to the
applicable percentage amount set forth below for such Loan with respect to Level
II, provided that from and after any Start Date to and including the
--------
corresponding End Date, the Applicable Margin with respect to LIBOR Rate Loans
and Prime Rate Loans, respectively, shall be a percentage per annum equal to the
applicable percentage per annum set forth below if, in each case as determined
as of the Test Date for such Start Date, the Consolidated Entity shall have the
applicable ratio set forth below of (x) Consolidated Total Indebtedness to (y)
Consolidated EBITDA for the twelve (12) Fiscal Month period ending on such Test
Date; provided, further, that if, as a result of the foregoing, a reduction in
-------- -------
the Applicable Margin to Level V is scheduled to occur as of any Start Date,
such scheduled reduction shall not be given effect if Total Exposure on such
Start Date (or at any time during the immediately preceding fifteen (15) day
period), is greater than zero ($-0-) and the Applicable Margin shall remain at
Level IV:
------------------------------------------
Applicable
Margin
---------------------------------------------------------------------------------------------------------------------
Ratio of Consolidated Total Prime LIBOR
Indebtedness to Consolidated EBITDA Rate Loans Rate Loans
=====================================================================================================================
I Equal to or greater than 4.0 to 1.0 1.00% 3.00%
---------------------------------------------------------------------------------------------------------------------
II Equal to or greater than 3.0 to 1.0 1.00% 2.75%
but less than 4.0 to 1.0
---------------------------------------------------------------------------------------------------------------------
III Equal to or greater than 2.5 to 1.0 1.00% 2.50%
but less than 3.0 to 1.0
---------------------------------------------------------------------------------------------------------------------
IV Equal to or greater than 2.0 to 1.0 1.00% 2.25%
but less than 2.5 to 1.0
---------------------------------------------------------------------------------------------------------------------
V Less than 2.0 to 1.0 1.00% 2.00%
---------------------------------------------------------------------------------------------------------------------
provided, that, notwithstanding the foregoing, if the Borrowers shall fail to
--------
deliver the financial statements that are required to be delivered pursuant to
Section 7.1(b), and the Agent in its sole discretion shall so elect, from the
date which is three Business Days after the date on which such financial
statements were so required to be delivered until the date of actual delivery
thereof, the
-2-
Applicable Margin shall be a percentage per annum equal to the applicable
percentage amount set forth above with respect to Level I.
"Applicable Margin Period" shall mean each period which shall commence on a
------------------------
date on which the financial statements are delivered pursuant to Section 7.1(b)
and which shall end on the earlier of (i) the date of actual delivery of the
next financial statements pursuant to Section 7.1(b) and (ii) the latest date on
which the next financial statements are required to be delivered pursuant to
Section 7.1(b), provided that the first Applicable Margin Period shall commence
--------
with the delivery of the financial statements in respect of the Test Period
ending on the last day of the fourth Fiscal Quarter of Fiscal Year 2002.
"Xxxxxxxxx" shall mean Xxxxxxxxx Containers, Inc., a Delaware corporation.
---------
"Assignment and Assumption Agreement" shall mean an assignment and
-----------------------------------
assumption agreement entered into by an assigning Lender and an assignee Lender,
and accepted by the Agent, in accordance with Section 11.6, substantially in the
form of Exhibit A.
"Auditors" shall mean a nationally-recognized firm of independent certified
--------
public accountants selected by the Borrowers and satisfactory to the Agent in
its sole discretion. For purposes of this Credit Agreement, the Borrowers'
current firm of independent certified public accountants, Deloitte & Touche LLP,
shall be deemed to be satisfactory to the Agent.
"Bankruptcy Default" shall mean a Default which is such by virtue of
------------------
Section 9.1(e)(ii).
"Benefit Plan" shall mean an employee pension benefit plan as defined in
------------
Section 3(2) of ERISA (other than a Multiemployer Plan) for which the funding
requirements under Section 412 of the Code or Section 302 of ERISA is, or within
the immediately preceding six (6) years was, in whole or in part, the
responsibility of any Borrower, any Subsidiary of any Borrower or any ERISA
Affiliate.
"BMI" shall mean BWAY Manufacturing, Inc., a Delaware corporation.
---
"Borrowers" shall mean Xxxxxxxxx, BMI, MCC and Parent.
---------
"Borrowers' Account" shall have the meaning ascribed to that term in
------------------
Section 2.6.
"Borrower Security Agreement" shall mean the General Security Agreement, of
---------------------------
even date herewith, among the Agent and the Borrowers.
"Borrower Taxes" shall have the meaning ascribed to that term in Section
--------------
6.20(b).
"Borrowing" shall mean a borrowing consisting of Loans of the same Type
---------
made on the same day by the Lenders.
"Borrowing Base" shall mean:
--------------
(a) Subject to clause (b) below, at any time, the amount equal at such
time to:
-3-
(i) the Fixed Asset Sublimit, plus
(ii) eighty-five percent (85%) of the Eligible Accounts Receivable,
plus
(iii) the lesser of $25,000,000 or sixty percent (60%) of the Eligible
Inventory consisting of raw materials and finished goods, including, without
limitation, Eligible Inventory consisting of slit steel and blank steel, plus
(iv) the lesser of $5,000,000 or fifty percent (50%) of the Eligible
Inventory consisting of work-in-progress; minus
(v) the amount of any reserves established by the Agent pursuant to
Section 7.8(b), clause (b) below or any other term or provision of this Credit
Agreement.
(b) The Agent at any time in the exercise of its Permitted Discretion
shall be entitled to (i) establish and increase or decrease reserves against
Eligible Accounts Receivable, Eligible Inventory and the Fixed Asset Sublimit;
(ii) reduce the advance rates under clauses (a)(ii), (iii) and (iv) above or,
following any such reduction, restore such advance rates to any level equal to
or below the advance rates stated in clauses (a)(i), (ii), (iii) and (iv) above;
(iii) impose additional restrictions (or eliminate the same) to the standards of
eligibility set forth in the respective definitions of "Eligible Accounts
Receivable," "Eligible Inventory" and "Fixed Asset Sublimit"; and (iv) establish
and increase or decrease a reserve in the amount of interest payable by the
Borrowers hereunder, including interest on Loans and Unpaid Drawings.
"Borrowing Base Certificate" shall have the meaning ascribed to that term
--------------------------
in Section 7.1(f).
"BT Account" shall have the meaning ascribed to that term in Section
----------
2.5(c).
"BTCo" shall mean Bankers Trust Company, a New York banking corporation,
----
acting in its individual capacity.
"Business Day" shall mean any day other than a Saturday, Sunday or legal
------------
holiday on which commercial banks in Chicago, Illinois or New York, New York,
are generally closed or are authorized to close. When used in connection with
LIBOR Rate Loans, this definition will also exclude any day on which commercial
banks are not open for dealing in Dollar deposits in the London (England, U.K.)
interbank market. When used in connection with any Letter of Credit, this
definition will also exclude any day on which the applicable Issuing Lender is
not open for the general conduct of its business.
"Capital Expenditures" shall mean, of any Person for any period, the sum of
--------------------
(a) all expenditures capitalized by such Person for financial statement purposes
in accordance with GAAP plus, without duplication, (b) the entire principal
----
amount of any debt (including obligations under Capital Leases) assumed or
incurred by such Person in connection with any such expenditures, provided that
Capital Expenditures of any Person shall in any event include the purchase price
paid by such Person in connection with the acquisition of any other Person
(including through the purchase of a majority of the Capital Securities or other
ownership interests of such other Person or through merger or consolidation) to
the extent allocable to
-4-
property, plant or equipment. For purposes of Section 8.2 only, insurance
proceeds and any other payments received on account of any Casualty Loss applied
to the repair or replacement of the property affected by such Casualty Loss
shall not constitute Capital Expenditures.
"Capital Lease" shall mean, with respect to any Person, any lease that is
-------------
capitalized by such Person for financial statement purposes in accordance with
GAAP.
"Capital Security" shall mean, with respect to any Person, (a) any share of
----------------
capital stock of or any membership, partnership or other unit of ownership
interest in such Person and (b) any security convertible into, or any option,
warrant or other right to acquire, any share of capital stock of or other unit
of ownership interest in such Person.
"Cash Equivalents" shall mean (a) securities issued, guarantied or insured
----------------
by the United States or any of its agencies with maturities of not more than one
year from the date acquired, (b) certificates of deposit with maturities of not
more than one year from the date acquired issued by a U.S. federal or state
chartered commercial bank of recognized standing, which has capital and
unimpaired surplus in excess of $200,000,000 and which bank or its holding
company has a short-term commercial paper rating of at least A-1 or the
equivalent by Standard & Poor's Corporation and at least P-1 or the equivalent
by Xxxxx'x Investors Services, Inc., (c) reverse repurchase agreements with
terms of not more than seven days from the date acquired, for securities of the
type described in clause (a) above and entered into only with commercial banks
having the qualifications described in clause (b) above, (d) commercial paper,
other than commercial paper issued by any Borrower or any Affiliate of any
Borrower, issued by any Person incorporated under the laws of the United States
or any state thereof and rated at least A-1 or the equivalent thereof by
Standard & Poor's Corporation or at least P-1 or the equivalent thereof by
Xxxxx'x Investors Services, Inc., in each case with maturities of not more than
one year from the date acquired, and (e) investments in money market funds which
have net assets of at least $200,000,000 and at least eighty-five percent (85%)
of whose assets consist of securities and other obligations of the type
described in clauses (a) through (d) above.
"Casualty Loss" shall mean the theft, loss, physical destruction, damage,
-------------
taking or any other similar event with respect to any property or assets of any
Borrower or any Subsidiary of any Borrower.
"Change of Control" shall mean one or more of the following events:
-----------------
(a) less than a majority of the members of the Board of Directors of
the Parent shall be persons who either (i) were serving as directors on the
Closing Date or (ii) were nominated as directors and approved by the vote
of the majority of the directors who are directors referred to in clause
(i) above or this clause (ii); or
(b) the stockholders of any Credit Party shall approve any plan or
proposal for the liquidation or dissolution of such Credit Party; or
(c) a Person or group of Persons acting in concert (other than the
direct or indirect beneficial owners of the Capital Securities of the
Parent as of the Closing Date) shall, as a result of a tender or exchange
offer, open market purchases, privately negotiated
-5-
purchases or otherwise, have become the direct or indirect beneficial owner
(within the meaning of Rule 13d-3 under the Securities Exchange Act of
1934, as amended from time to time) of Capital Securities of the Parent
representing more than thirty percent (30%) of the combined voting power of
the outstanding voting Capital Securities or other ownership interests for
the election of directors or shall have the right to elect a majority of
the Board of Directors of the Parent; or
(d) the Parent shall cease to be the legal and beneficial owner of
one hundred percent (100%) of the Capital Securities of each Borrower; or
(e) the occurrence of a "Change of Control" (as such term is defined
in the Subordinated Note Indenture).
"Closing Date" shall mean the date on which the initial Credit Event
------------
occurs.
"Closing Document List" shall mean the Closing Document List attached
---------------------
hereto as Annex I.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
----
"Collateral" shall mean any and all assets and rights and interests in or
----------
to property of each of the Borrowers and each of the other Credit Parties,
whether real or personal, tangible or intangible, on which a Lien is granted or
purported to be granted pursuant to the Collateral Documents.
"Collateral Access Agreements" shall mean any landlord waivers, mortgagee
----------------------------
waivers, bailee letters and any similar acknowledgment agreements of any Person,
such as a warehouseman or processor, in possession of Inventory of any Borrower,
in each case in form and substance satisfactory to the Agent.
"Collateral Documents" shall mean the Borrower Security Agreement, the
--------------------
Pledge Agreement, and all other contracts, instruments and other documents now
or hereafter executed and delivered in connection with this Credit Agreement,
pursuant to which Liens are granted or are purported to be granted to the Agent
in the Collateral for the benefit of some or all of the Agent, the Lenders and
the Issuing Lenders.
"Commitment" of any Lender shall, subject to Section 11.18(c)(ii), mean the
----------
amount set forth below such Lender's name on Annex II, under the heading
"Commitment," as such amount may be reduced from time to time or terminated
pursuant to the terms of this Credit Agreement.
"Consolidated EBITDA" shall mean, for any fiscal period of the Consolidated
-------------------
Entity, (a) Consolidated Net Income (other than extraordinary items) for such
period, plus (b) the amount of all Interest Expense, income tax expense,
----
depreciation and amortization, including amortization of any goodwill or other
intangibles, for such period, to the extent deducted in calculating Consolidated
Net Income for such period, and plus or minus (as the case may be) (c) (i) any
---- -----
other non-cash charges, (ii) restructuring charges, to the extent reported in
the third Fiscal Quarter of Fiscal Year 2001, and (iii) any gains and losses
attributable to any fixed asset sales, which have been, in the case of either
clause (i), (ii) or (iii), subtracted or added, as the
-6-
case may be, in calculating Consolidated Net Income for such period, all
determined in accordance with GAAP.
"Consolidated Entity" shall mean the Parent and each of its Subsidiaries
-------------------
which are such by virtue of clause (a) of the definition thereof but shall mean
and include, in any event, each Borrower.
"Consolidated Fixed Charge Coverage Ratio" means, as determined as of any
----------------------------------------
date for any period ending on such date, the ratio of (a) Consolidated EBITDA
for such period to (b) the sum of the following, in each case of the
Consolidated Entity, as determined without duplication in accordance with GAAP
for such period, (i) income tax expense paid in cash, (ii) Interest Expense paid
or payable in cash, (iii) Capital Expenditures (except for Capital Expenditures
financed with the proceeds of Indebtedness other than the Loans), (iv) payments
of principal on Indebtedness (other than repayments in the ordinary course of
the Loans which do not permanently reduce the Total Commitments); (v) reductions
in the Fixed Asset Sublimit pursuant to clause (a) of the definition thereof,
and (vi) if such period is or includes the fourth Fiscal Quarter of the 2001
Fiscal year, or any Fiscal Quarter ending thereafter, any Restricted Payment
made by Parent pursuant to Section 8.8(b) hereof during such period.
"Consolidated Net Income" shall mean for any period the consolidated net
-----------------------
income of the Consolidated Entity for such period.
"Consolidated Total Indebtedness" shall mean, as determined as of any Test
-------------------------------
Date, the sum, without duplication, of (a) all Indebtedness of the Consolidated
Entity as of such Test Date, and (b) the increase, if any, in the aggregate
unpaid trade accounts payable of the Borrowers as of such Test Date over the
aggregate unpaid trade accounts payable of the Borrowers as of the immediately
preceding Test Date, to the extent the Agent determines in its sole discretion
that such increase has not occurred in the ordinary course of the respective
businesses of the Borrowers.
"Continuation" shall have the meaning ascribed to that term in Section 4.3.
------------
"Control" shall mean, with respect to any Person, the possession, directly
-------
or indirectly, of the power to (a) vote five percent (5%) or more of the
securities having ordinary voting power for the election of directors of such
Person or (b) direct or cause the direction of management and policies of such
Person, whether through the ownership of voting securities, by contract or
otherwise either alone or in conjunction with others or any group. The words
"Controlling" and "Controlled" have correlative meanings.
"Convert," "Conversion" and "Converted" each shall refer to a conversion of
------- ---------- ---------
Loans of one Type into Loans of another Type pursuant to Section 4.3.
"Covered Taxes" shall have the meaning ascribed to that term in Section
-------------
2.8(a).
"Credit Agreement" shall mean this credit agreement, dated as of the date
----------------
hereof, as the same may be modified, amended, extended, restated, amended and
restated or supplemented from time to time.
-7-
"Credit Documents" shall mean, collectively, this Credit Agreement, the
----------------
Notes, the Letters of Credit, each of the Collateral Documents and all other
documents, agreements, instruments, opinions and certificates now or hereafter
executed and delivered in connection herewith or therewith, as the same may be
modified, amended, extended, restated, amended and restated or supplemented from
time to time.
"Credit Event" shall mean (a) the making of a Loan and (b) the issuance of
------------
any Letter of Credit.
"Credit Parties" shall mean, collectively, the Borrowers, the Funds
--------------
Administrator and all other Persons (other than the Lenders, the Agent and the
Issuing Lenders) parties to the Credit Documents (other than the Collateral
Access Agreements and any opinions of counsel delivered to the Agent, any Lender
or any Issuing Lender in connection with any Credit Document).
"Default" shall mean an event, condition or default which with the giving
-------
of notice, the passage of time or both would be an Event of Default.
"Defaulting Lender" shall have the meaning ascribed to that term in Section
-----------------
11.18(b).
"Depositary Account" shall have the meaning ascribed to that term in
------------------
Section 2.5(b)(ii).
"Depositary Account Agreement" shall have the meaning ascribed to that term
----------------------------
in Section 2.5(b)(ii).
"Depositary Account Bank" shall have the meaning ascribed to that term in
-----------------------
Section 2.5(b)(ii).
"Derivative Contract" shall mean an agreement, whether or not in writing
-------------------
and including any master agreement, documenting, evidencing or relating to any
Derivative Transaction between any Borrower, or any Subsidiary of any Borrower,
and another Person.
"Derivative Transaction" shall mean (a) an interest-rate transaction,
----------------------
including an interest-rate swap, basis swap, forward rate agreement, interest
rate option (including a cap, collar, and floor), and any other instrument
linked to interest rates that gives rise to similar credit risks (including
when-issued securities and forward deposits accepted), (b) an exchange-rate
transaction, including a cross-currency interest-rate swap, a forward foreign-
exchange contract, a currency option, and any other instrument linked to
exchange rates that gives rise to similar credit risks, (c) an equity derivative
transaction, including an equity-linked swap, an equity-linked option, a forward
equity-linked contract, and any other instrument linked to equities that gives
rise to similar credit risk and (d) a commodity (including precious metal)
derivative transaction, including a commodity-linked swap, a commodity-linked
option, a forward commodity-linked contract, and any other instrument linked to
commodities that gives rise to similar credit risks.
"Disbursement Account" means the operating account of the Funds
--------------------
Administrator maintained with the Disbursement Account Bank.
-8-
"Disbursement Account Bank" shall mean Bankers Trust (Delaware); BTCo;
-------------------------
Deutsche Bank AG, New York Branch; or any other bank selected from time to time
by the Agent and reasonably acceptable to the Funds Administrator.
"DOL" shall mean the United States Department of Labor and any successor
---
department or agency.
"Dollars" and the sign "$" shall each mean freely transferable lawful money
------- -
of the United States of America.
"Domestic Lending Office" shall mean, with respect to any Lender, the
-----------------------
office of such Lender specified as its "Domestic Lending Office" below its name
on Annex II, as such annex may be amended from time to time.
"Drawing" shall have the meaning ascribed to that term in Section 3.5(b).
-------
"Eligible Accounts Receivable" shall mean Accounts of a Borrower payable in
----------------------------
Dollars and deemed by the Agent in its Permitted Discretion to be eligible for
inclusion in the calculation of the Borrowing Base. In determining the amount
to be so included, the face amount of such Accounts shall be reduced by the
amount of all returns, discounts, claims, credits, charges, or other allowances
and by the aggregate amount of all reserves, limits and deductions provided for
in this definition and elsewhere in this Credit Agreement, including any
reserves established by the Agent pursuant to the definition of the term
"Borrowing Base" set forth herein, and there shall be excluded any such Accounts
that the Agent determines to be ineligible pursuant to the definition of the
term "Borrowing Base" set forth herein. Unless otherwise approved in writing by
the Agent, no Account of any Borrower shall be deemed to be an Eligible Account
Receivable if:
(a) it arises out of a sale made by such Borrower to an Affiliate of
such or any other Borrower; or
(b) its payment terms are longer than 60 days from date of invoice
(c) it is unpaid (i) more than 60 days after the original payment due
date on payment terms of 30 days or less from date of invoice, or (ii) more
than 30 days after the original payment due date on payment terms of or
more than 30 days from date of invoice; or
(d) it is from the same account debtor (or any Affiliate thereof) and
fifty percent (50%) or more, in face amount, of all Accounts from such
account debtor (or any Affiliate thereof) are ineligible pursuant to (b),
(c) or (d) above; or
(e) the Account, when aggregated with all other Accounts of such
account debtor, exceeds ten percent (10%) in face value of all Accounts of
the Borrowers combined then outstanding, to the extent of such excess;
provided that Accounts supported or secured by an irrevocable letter of
credit in form and substance satisfactory to the Agent, issued by a
financial institution satisfactory to the Agent, and duly transferred to
the Agent (together with sufficient documentation to permit direct draws by
-9-
the Agent) shall be excluded to the extent of the face amount of such
letter of credit for the purposes of such calculation; or
(f) (i) the account debtor is also a creditor of such Borrower, (ii)
the account debtor has disputed its liability on, or the account debtor has
made any claim with respect to, such Account or any other Account due from
such account debtor to such Borrower, which has not been resolved or (iii)
the Account otherwise is or may become subject to any right of setoff by
the account debtor; provided that any Account deemed ineligible pursuant to
this clause (f) shall only be ineligible to the extent of the amount owed
by such Borrower to the account debtor, the amount of such dispute or
claim, or the amount of such setoff, as applicable; or
(g) the account debtor has commenced a voluntary case under the
federal bankruptcy laws, as now constituted or hereafter amended, or made
an assignment for the benefit of creditors, or if a decree or order for
relief has been entered by a court having jurisdiction over the account
debtor in an involuntary case under the federal bankruptcy laws, as now
constituted or hereafter amended, or if any other petition or other
application for relief under the federal bankruptcy laws has been filed by
or against the account debtor, or if the account debtor has filed a
certificate of dissolution under applicable state law or shall be
liquidated, dissolved or wound-up, or shall authorize or commence any
action or proceeding for dissolution, winding-up or liquidation, or if the
account debtor has failed, suspended business, declared itself to be
insolvent, is generally not paying its debts as they become due or has
consented to or suffered a receiver, trustee, liquidator or custodian to be
appointed for it or for all or a significant portion of its assets or
affairs (any such act or event an "Act of Bankruptcy"), unless the payment
of Accounts from such account debtor is secured by assets of, or guaranteed
by, in either case in a manner satisfactory to the Agent, a Person with
respect to which an Act of Bankruptcy has not occurred and that is
acceptable to the Agent or, if the Account from such account debtor arises
subsequent to a decree or order for relief with respect to such account
debtor under the federal bankruptcy laws, as now or hereafter in effect,
the Agent shall have determined that the timely payment and collection of
such Account will not be impaired; or
(h) the sale is to an account debtor outside of the continental
United States, unless such account debtor has supplied such Borrower with
an irrevocable letter of credit in form and substance satisfactory to the
Agent, issued by a financial institution satisfactory to the Agent and
which has been duly transferred to the Agent (together with sufficient
documentation to permit direct draws by the Agent); or
(i) the sale to the account debtor is on a xxxx-and-hold, guarantied
sale, sale-and-return, sale on approval or consignment basis or made
pursuant to any other written agreement providing for repurchase or return;
or
(j) the Agent determines in its Permitted Discretion that collection
of such Account is insecure or that such Account may not be paid by reason
of the account debtor's financial inability to pay; or
-10-
(k) the account debtor is the United States of America or any
department, agency or instrumentality thereof, unless such Borrower duly
assigns its rights to payment of such Account to the Agent pursuant to the
Assignment of Claims Act of 1940 (31 U.S.C. (S) 3727 et seq.); or
(l) the goods giving rise to such Account have not been shipped and
delivered to and accepted by the account debtor or the services giving rise
to such Account have not been performed by such Borrower and accepted by
the account debtor or the Account otherwise does not represent a final
sale; or
(m) the Account does not comply with all applicable legal
requirements, including, where applicable, the Federal Consumer Credit
Protection Act, the Federal Truth in Lending Act and Regulation Z of the
Board of Governors of the Federal Reserve System; or
(n) the Agent does not have a valid and perfected first priority
security interest in such Account or the Account does not otherwise conform
to the representations and warranties contained in the Credit Agreement,
any Security Agreement or any of the other Collateral Documents; or
(o) the Accounts are subject to any adverse security deposit,
progress payment or other similar advance made by or for the benefit of the
applicable account debtor.
"Eligible Inventory" shall mean Inventory of a Borrower that consists of
------------------
raw materials, work in progress and finished goods deemed by the Agent in its
Permitted Discretion to be eligible for inclusion in the calculation of the
Borrowing Base. In determining the amount to be so included, the amount of such
Inventory shall be valued at the lower of cost or market on a basis consistent
with such Borrower's current and historical accounting practice, and shall
exclude (a) any goods returned or rejected by such Borrower's customers and
goods in transit to third parties (other than to such Borrower's agents and
warehouses that are not excluded pursuant to clause (ii)(B) of the next
succeeding sentence), (b) any Inventory that the Agent determines to be
ineligible pursuant to the definition of the term "Borrowing Base" set forth
herein, and (c) any reserves established by the Agent pursuant to the definition
of the term "Borrowing Base" set forth herein. Unless otherwise approved in
writing by the Agent, no Inventory of any Borrower shall be deemed Eligible
Inventory if:
(i) the Inventory is not owned solely by such Borrower or such
Borrower does not have good, valid and marketable title thereto; or
(ii) the Inventory is not stored on property that is either (A) owned
or leased by such or any other Borrower or (B) owned or leased by a warehouseman
that has contracted with such Borrower to store Inventory on such warehouseman's
property (provided that, with respect to Inventory of any Borrower stored on
property leased by a Borrower, such Borrower shall have delivered to the Agent a
Collateral Access Agreement executed by the lessor of such property, and, with
respect to Inventory of any Borrower stored on property owned or leased by a
warehouseman, such Borrower shall have delivered to the Agent a Collateral
Access Agreement executed by such warehouseman); or
-11-
(iii) the Inventory is not subject to a valid and perfected first
priority security interest in favor of the Agent except, with respect to
Eligible Inventory stored at sites described in clause (ii)(B) of this sentence,
for Liens for normal and customary warehousing charges; or
(iv) the Inventory is obsolete or slow moving (in each case as
determined by the Agent) or the Inventory does not otherwise conform to the
representations and warranties contained in the Credit Agreement, the Borrower
Security Agreement or any of the other Collateral Documents; or
(v) the Inventory was not manufactured in accordance with and does
not meet all standards imposed by all Requirements of Law or by any government
agency, or department or division thereof, having regulatory authority over such
goods or their manufacture, use or sale.
"End Date" shall mean, for any Applicable Margin Period, the last day of
--------
such Applicable Margin Period.
"Equipment" shall mean, with respect to any Person, all of such Person's
---------
equipment, including machinery, equipment, office equipment and supplies,
computers and related equipment, furniture, furnishings, tools, tooling, jigs,
dies, fixtures, manufacturing implements, fork lifts, trucks, trailers, motor
vehicles, and other equipment.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, and
-----
all final or temporary regulations promulgated thereunder and published,
generally applicable rulings entitled to precedential effect.
"ERISA Affiliate" shall mean any Person required at any relevant time to be
---------------
aggregated with any Borrower or any Subsidiary of any Borrower under Sections
414(b), (c), (m) or (o) of the Code.
"Event(s) of Default" shall have the meaning ascribed to that term in
-------------------
Article 9 of this Credit Agreement.
"Excess Cash Flow" shall mean, for any fiscal period of the Consolidated
----------------
Entity, (a) Consolidated EBITDA for such period, minus (b) the sum of (i)
Interest Expense, (ii) income taxes paid or payable in cash, (iii) principal
payments on or mandatory redemptions of Indebtedness (other than repayments of
Loans in the ordinary course of business which do not permanently reduce the
Commitments), to the extent permitted hereunder, (iv) Capital Expenditures, to
the extent permitted hereunder and (v) scheduled mandatory reductions of the
Fixed Asset Sublimit pursuant to clause (a) of the definition thereof, and plus
or minus (as the case may be) (c) other non-recurring items acceptable to the
Agent, all determined in accordance with GAAP.
"Excess Cash Flow Allowance" shall mean an amount equal to zero, provided,
--------------------------
that (a) the Excess Cash Flow Allowance shall be increased on the date which is
ninety (90) days after the end of the 2002 Fiscal Year, and further increased on
the date which is ninety (90) days after the end of each consecutive Fiscal Year
ending thereafter, in each case by an amount equal to thirty percent (30%) of
Excess Cash Flow for such Fiscal Year, if and only if the ratio of Consolidated
Total Indebtedness as of the last day of such Fiscal Year, to Consolidated
EBITDA
-12-
for such Fiscal Year, is less than 3.25 to 1.0; and (b) the Excess Cash Flow
Allowance shall be automatically and permanently decreased by an amount equal to
any portion thereof allocated from time to time by the Funds Administrator to
the making of any Capital Expenditure or to the consummation of any Acquisition.
"Expenses" shall mean all present and future expenses actually incurred by
--------
or on behalf of the Agent, in its capacity as Agent, in connection with the
Credit Agreement, any other Credit Document or otherwise, whether incurred
heretofore or hereafter, which expenses shall include, without being limited to,
the cost of record searches, the fees and expenses of attorneys (including the
allocated cost of internal counsel) and paralegals, all costs and expenses
incurred by the Agent in opening bank accounts and lockboxes, depositing checks,
receiving and transferring funds, and any charges imposed on the Agent due to
insufficient funds of deposited checks and the Agent's standard fee relating
thereto, collateral examination fees and expenses, fees and expenses of
accountants, appraisers, field examiners or other consultants, experts or
advisors employed or retained by the Agent, fees and expenses incurred by the
Agent in connection with the assignments of or sales of participations in the
Loans, title insurance premiums, real estate survey costs, fees and taxes
relative to the filing of financing statements, costs of preparing and recording
any Mortgages or any other Collateral Documents, all expenses and costs referred
to in Article 4 of this Credit Agreement, all other fees and expenses required
to be paid pursuant to the Fee Letter and all fees and expenses incurred in
connection with releasing Collateral and the amendment or termination of any of
the Credit Documents.
"Expiration Date" shall mean the earlier of (a) May 22, 2005 and (b) the
---------------
termination or reduction to zero (0) of the Commitments.
"Exposure" shall have the meaning ascribed to that term in the definition
--------
of "Majority Lenders".
"Federal Funds Rate" shall mean, for any period, a fluctuating interest
------------------
rate per annum equal, for each day during such period, to the weighted average
of the rates on overnight Federal Funds transactions with members of the Federal
Reserve System arranged by Federal Funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day that is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three Federal Funds brokers of
recognized standing selected by it.
"Fee Letter" shall mean that certain fee letter agreement dated as of the
----------
date hereof between the Agent and the Borrowers providing for the payment of
certain fees in connection with this Credit Agreement.
"Fees" shall mean the Unused Line Fee, the Letter of Credit Fee and the
----
Issuing Lender Fees, and, without duplication, all fees payable by the Borrowers
under the Fee Letter.
"Fiscal Month" shall mean any of the monthly accounting periods of the
------------
Consolidated Entity.
-13-
"Fiscal Quarter" shall mean any of the quarterly accounting periods of the
--------------
Consolidated Entity.
"Fiscal Year" shall mean any of the annual accounting periods of the
-----------
Consolidated Entity.
"Financial Statements" shall mean the consolidated and, unless otherwise
--------------------
specified, consolidating balance sheets, statements of operations, statements of
cash flows and statements of changes in shareholder's equity of the Consolidated
Entity for the period specified.
"Fixed Asset Sublimit" shall mean an amount equal to $25,000,000; provided
--------------------
that the Fixed Asset Sublimit shall be automatically and permanently reduced:
(a) on the first Business Day of each consecutive Fiscal Quarter
commencing with the first Fiscal Quarter of Fiscal Year 2002, by an amount
equal to $892,850;
(b) on the date which is ninety (90) days after the end of the 2002
Fiscal Year, and ninety (90) days after the end of each Fiscal Year ending
thereafter, in each case by an amount equal to (i) if the ratio of
Consolidated Total Indebtedness as of the last day of such Fiscal Year, to
Consolidated EBITDA for such Fiscal Year, is less than 3.5 to 1.0, thirty
percent (30%) of Excess Cash Flow for such Fiscal Year and (ii) if the
ratio of Consolidated Total Indebtedness as of the last day of such Fiscal
Year, to Consolidated EBITDA for such Fiscal Year, is equal to or greater
than 3.5 to 1.0, fifty percent (50%) of Excess Cash Flow for such Fiscal
Year;
(c) on each date on or after the Closing Date upon which any Borrower
or any Subsidiary of any Borrower receives Net Disposition Proceeds (other
than Net Disposition Proceeds in respect of any Casualty Losses), in each
case by an amount equal to the greater of (i) such Net Disposition Proceeds
or (ii) the orderly liquidation value of the fixed assets in respect of
which such Net Disposition Proceeds were received, as determined by the
Agent in its sole and absolute discretion; and
(d) on each date in any Fiscal Year ending on or after the Closing
Date upon which any Borrower or any Subsidiary of any Borrower receives Net
Disposition Proceeds of a Casualty Loss, by an amount equal to the portion,
if any, of such Net Disposition Proceeds required to be so applied pursuant
to Section 7.8(b).
"Foreign Lender" shall mean any Lender or Serving Affiliate organized under
--------------
the laws of a jurisdiction outside of the United States.
"Funding Bank" shall have the meaning ascribed to that term in Section 4.9.
------------
"Funds Administrator" shall mean Parent, acting in its capacity as
-------------------
borrowing agent and funds administrator for itself and the other Borrowers
hereunder and under each of the other Credit Documents.
"GAAP" shall mean generally accepted accounting principles in the United
----
States as in effect from time to time.
-14-
"Governing Documents" shall mean, as to any Person, the certificate or
-------------------
articles of incorporation and by-laws or other organizational or governing
documents of such Person.
"Governmental Authority" shall mean any nation or government, any state or
----------------------
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Guaranty" of any Person means any Liability, contingent or otherwise, of
--------
such Person (other than an endorsement for collection or deposit in the ordinary
course of business) (a) to pay any Liability of any other Person or to otherwise
protect, or having the practical effect of protecting, the holder of any such
Liability against loss (whether such obligation arises by virtue of such Person
being a partner of a partnership or participant in a joint venture or by
agreement to pay, to keep well, to maintain solvency, assets, level of income or
other financial condition, to purchase assets, goods, securities or services or
to take or pay, or otherwise) or (b) incurred in connection with the issuance by
a third Person of a Guaranty of any Liability of any other Person (whether such
obligation arises by agreement to reimburse or indemnify such third Person or
otherwise). The word "Guarantee" when used as a verb has the correlative
---------
meaning.
"Highest Lawful Rate" shall mean, at any time when any Obligations shall be
-------------------
outstanding hereunder, the maximum nonusurious interest rate, that then may be
contracted for, taken, reserved, charged or received on the Obligations owing
under this Credit Agreement or any of the other Credit Documents, under (a) the
laws of the State of New York (or the law of any other jurisdiction whose laws
may be mandatorily applicable notwithstanding other provisions of this Credit
Agreement and the other Credit Documents) or (b) if higher, applicable federal
laws, in any case after taking into account, to the extent permitted by
applicable law, any and all relevant payments or charges under this Credit
Agreement and any other Credit Documents executed in connection herewith, and
any available exemptions, exceptions and exclusions.
"Indebtedness" of any Person means (in each case, whether such obligation
------------
is with full or limited recourse) (a) any obligation of such Person for borrowed
money, (b) any obligation of such Person evidenced by a bond, debenture, note or
other similar instrument, (c) any obligation of such Person to pay the deferred
purchase price of property or services, except a trade account payable that
arises in the ordinary course of business but only if and so long as the same is
payable on customary trade terms, (d) any obligation of such Person as lessee
under a Capital Lease, (e) any Mandatorily Redeemable Obligation of such Person
owned by any Person other than such Person or a Subsidiary of such Person (the
amount of such Mandatorily Redeemable Obligation to be determined for this
purpose as the higher of the liquidation preference of and the amount payable
upon redemption of such Mandatorily Redeemable Obligation), (f) any obligation
of such Person to purchase securities or other property that arises out of or in
connection with the sale of the same or substantially similar securities or
property, (g) any non-contingent obligation of such Person to reimburse any
other Person in respect of amounts paid under a letter of credit or other
Guaranty issued by such other Person to the extent that such reimbursement
obligation remains outstanding after it becomes non-contingent, (h) any
Derivative Contract or similar obligation obligating such Person to make
payments, whether periodically or upon the happening of a contingency, except
that if any agreement relating to such obligation provides for the netting of
amounts payable by and to such Person thereunder or
-15-
if any such agreement provides for the simultaneous payment of amounts by and to
such Person, then in each such case, the amount of such obligation shall be the
net amount thereof, (i) any Indebtedness of others secured by (or for which the
holder of such Indebtedness has an existing right, contingent or otherwise, to
be secured by) a Lien on any asset of such Person and (j) any Indebtedness of
others Guaranteed by such Person.
"Interest Expense" shall mean the aggregate consolidated interest expense
----------------
(net of interest income) of the Consolidated Entity in respect of Indebtedness
determined on a consolidated basis in accordance with GAAP, including
amortization of original issue discount on any Indebtedness and of all fees
payable in connection with the incurrence of such Indebtedness (to the extent
included in interest expense), the interest portion of any deferred payment
obligation and the interest component of any Capital Lease obligations.
"Interest Period" shall mean a period, commencing, in the case of the first
---------------
Interest Period applicable to a LIBOR Rate Loan, on the date of the making of,
or conversion into, such Loan, and, in the case of each subsequent, successive
Interest Period applicable thereto, on the last day of the immediately preceding
Interest Period. 'The duration of each such Interest Period shall be one, two,
three or six months, in each case as the Funds Administrator may, in an
appropriate Notice of Borrowing, Notice of Continuation or Notice of Conversion,
select; provided that the Funds Administrator may not select any Interest Period
that ends after the Expiration Date. Whenever the last day of any Interest
Period would otherwise occur on a day other than a Business Day, the last day of
such Interest Period shall be extended to occur on the next succeeding Business
Day, provided that if such extension would cause the last day of such Interest
Period to occur in the next following calendar month, the last day of such
Interest Period shall occur on the next preceding Business Day.
"Interim Advance" shall mean a Loan made by the Agent to a Borrower
---------------
pursuant to Section 2.2(b)(i).
"Interim Advance Period" shall have the meaning ascribed to that term in
----------------------
Section 2.2(b)(i).
"Internal Revenue Service" or "IRS" shall mean the United States Internal
------------------------ ---
Revenue Service and any successor agency.
"Inventory" shall mean, with respect to any Person, all of such Person's
---------
inventory, including: (a) all raw materials, work in process, parts, components,
assemblies, supplies and materials used or consumed in such Person's business;
(b) all goods, wares and merchandise, finished or unfinished, held for sale or
lease or leased or furnished or to be furnished under contracts of service; and
(c) all goods returned or repossessed by such Person.
"Investment" shall mean, as applied to an investment of or by any Person,
----------
all Guaranties by such Person of any Liabilities of another Person, all
expenditures made and all Liabilities incurred (contingently or otherwise) for
or in connection with the acquisition of (i) all or substantially all of the
assets of another Person, (ii) stock or other ownership interests of another
Person, or (iii) Indebtedness of, or loans, advances, capital contributions or
transfers of property to, another Person. In determining the aggregate amount
of Investments outstanding at any
-16-
particular time, (a) the amount of any Investment represented by a Guaranty
shall be taken at not less than the principal amount of the Liabilities to which
such Guaranty is applicable and still outstanding; (b) there shall be deducted
in respect of each such Investment any amount received as a return of capital
(but only by sale, repurchase, redemption, retirement, repayment, liquidating
dividend or liquidating distribution); (c) there shall not be deducted in
respect of any Investment any amounts received as earnings on such Investment,
whether as dividends, interest or otherwise; and (d) there shall not be deducted
from the original amount of any Investment, and such Investment shall be deemed
to continue to be "outstanding" in such original amount notwithstanding, any (i)
decrease in the market value thereof or (ii) amount thereof that may have been
forgiven, released, cancelled or otherwise nullified or held to be invalid.
"Issuing Lender" means BTCo (which, for purposes of this definition, also
--------------
shall include any banking affiliate of BTCo, including but not limited to
Deutsche Bank AG, New York Branch, which has agreed to issue Letters of Credit
under this Credit Agreement) or any other Lender acceptable to Agent.
"Issuing Lender Fees" shall have the meaning ascribed to that term in
-------------------
Section 4.6(b).
"LC Interest Rate" means, at any time, a rate per annum equal to the rate
----------------
per annum applicable at such time to Prime Rate Loans.
"LC Supportable Obligations" means (a) obligations of any Borrower or any
--------------------------
Subsidiary of any Borrower with respect to workers' compensation, surety bonds
and other similar statutory obligations and (b) such other obligations of a
Borrower or any Subsidiary of a Borrower as are reasonably acceptable to Agent.
"Lender" shall, subject to Section 11.18(c)(ii), mean (a) each Person
------
listed as a "Lender" on the signature pages hereof and (b) each Person that has
been assigned any or all of the rights and obligations of a Lender pursuant to
Section 11.6.
"Letter of Credit" shall have the meaning ascribed in that term in Section
----------------
3.1(a).
"Letter of Credit Fee" shall have the meaning ascribed to that term in
--------------------
Section 4.6(a).
"Letter of Credit Outstandings" shall mean, at any time, the sum of (a) the
-----------------------------
Stated Amounts of all outstanding Letters of Credit, and (b) the aggregate
amount of all unpaid Drawings in respect of Letters of Credit.
"Letter of Credit Request" shall have the meaning ascribed to that term in
------------------------
Section 3.3(a).
"Liability" of any Person shall mean (in each case, whether with full or
---------
limited recourse) any indebtedness, liability, obligation, covenant or duty of
or binding upon, or any term or condition to be observed by or binding upon,
such Person or any of its assets, of any kind, nature or description, direct or
indirect, absolute or contingent, due or not due, contractual or tortious,
liquidated or unliquidated, whether arising under contract, Requirement of Law,
or otherwise, whether now existing or hereafter arising, and whether for the
payment of money or the performance or non-performance of any act.
-17-
"LIBOR Lending Office" shall mean, with respect to any Lender, the office
--------------------
of such Lender specified as its "LIBOR Lending Office" below its name on Annex
II (or, if no such office is specified, its Domestic Lending Office), or such
other office or Affiliate of such Lender as such Lender may from time to time
specify to the Funds Administrator and the Agent.
"LIBOR Margin" shall have the meaning ascribed to that term in Section 4.1.
------------
"LIBOR Rate" shall mean, with respect to any Interest Period, (a) the rate
----------
per annum for Dollar deposits approximately equal to the principal amount of the
LIBOR Rate Loans for which the LIBOR Rate is being determined and with
maturities comparable to the Interest Period for which such LIBOR Rate would
apply, which appears on the Telerate Page 3750 at approximately 11:00 A.M.,
London time, on the day that is two (2) Business Days prior to the first day of
such Interest Period and (b) if no such rate so appears on the Telerate Page
3750, an interest rate per annum equal to the rate (rounded upward to the
nearest whole multiple of one-sixteenth (1/16) of one percent (1.00%) per annum,
if such rate is not such a multiple) of the offered quotation, if any, to first
class banks in the London (U.K.) interbank market by Deutsche Bank AG, New York
Branch, for Dollar deposits of amounts in immediately available funds comparable
to the principal amount of the LIBOR Rate Loans for which the LIBOR Rate is
being determined with maturities comparable to the Interest Period for which
such LIBOR Rate will apply as of approximately 10:00 A.M. two (2) Business Days
prior to the commencement of such Interest Period. The term "Telerate Page 3750"
shall mean the display designated as Page 3750 on the Telerate Services (or such
other page as may replace such page on such service for the purpose of
displaying a comparable rate).
"LIBOR Rate Loan" shall mean a Loan that bears, or is to bear, interest by
---------------
reference to the LIBOR Rate.
"Lien(s)" shall mean (a) any lien, claim, charge, pledge, security
-------
interest, deed of trust, mortgage, other encumbrance or other arrangement having
the practical effect of the foregoing or other preferential arrangement of any
other kind and shall include the interest of a vendor or lessor under any
conditional sale agreement, Capital Lease or other title retention agreement and
(b) in addition, in the case of any investment property, any contract or other
arrangement, express or implied, under which any Person has the right to control
such investment property.
"Line of Credit" shall mean, at any time, an amount equal to the aggregate
--------------
amount, at such time, of the Commitments, which shall not exceed $90,000,000, as
such amount may be reduced from time to time in accordance with Section 2.
"Loans" shall mean amounts advanced by the Agent or any Lender pursuant to
-----
Section 2.1, 2.2(b), 2.2(c) or any other provision of this Credit Agreement.
"Lockboxes" shall have the meaning ascribed to that term in Section
---------
2.5(b)(ii).
"Majority Lenders" shall mean, at any time, those Lenders having more than
----------------
50% of the aggregate amount of the Commitments or, if the Commitments shall have
expired or been terminated, Lenders having more than 50% of the aggregate amount
of the outstanding Exposures; and for this purpose, a Lender's "Exposure" shall
--------
mean the aggregate amount of such
-18-
Lender's outstanding Loans plus such Lender's Proportionate Share of the Letter
----
of Credit Outstandings.
"Mandatorily Redeemable Obligation" shall mean a Liability of any Borrower
---------------------------------
or any Subsidiary of any Borrower, or a Liability of another Person Guaranteed
by any Borrower or any Subsidiary of any Borrower, to the extent that, in either
case, it is redeemable, payable or required to be purchased or otherwise retired
or extinguished (a) at a fixed or determinable date, whether by operation of
sinking fund or otherwise, (b) at the option of any Person other than such
Borrower or such Subsidiary or (c) upon the occurrence of a condition not solely
within the control of such Borrower or such Subsidiary, such as a redemption
required to be made out of future earnings.
"Material Adverse Effect" shall mean a material adverse effect on (a) the
-----------------------
business, prospects (other than as a result of general macroeconomic
conditions), operations, results of operations, assets, liabilities or condition
(financial or otherwise) of the Credit Parties taken as a whole, (b) the value
of Collateral or the amount which the Agent, the Lenders or any Issuing Lender
would be likely to receive (after giving consideration to delays in payment and
costs of enforcement) in the liquidation of such Collateral, (c) any Credit
Party's ability to perform its obligations under the Credit Documents to which
it is a party or (d) the rights and remedies of the Agent, the Lenders or any
Issuing Lender under any Credit Document.
"Material Contract" shall mean any contract or other arrangement (other
-----------------
than the Credit Documents), whether written or oral, to which any Borrower or
any Subsidiary of any Borrower is a party with respect to which breaches,
nonperformances, cancellations or failures to renew by any party thereto singly
or in the aggregate could reasonably be expected to have a Material Adverse
Effect.
"MCC" shall mean Xxxxxx Can Company, Inc., a Delaware corporation.
---
"Mortgages" shall mean the mortgage(s), deeds of trust, leasehold mortgages
---------
and leasehold deeds of trust, if any, granted by the respective Credit Parties
to or for the benefit of the Agent, as the case may be.
"Multiemployer Plan" shall mean a "multiemployer plan" as defined in
------------------
Section 4001(a)(3) of ERISA and (a) which is, or within the immediately
preceding six (6) years was, contributed to by any Borrower, any Subsidiary of
any Borrower or any ERISA Affiliate or (b) with respect to which any Borrower or
any Subsidiary of any Borrower may incur any liability.
"NAIC" means the National Association of Insurance Commissioners.
----
"Net Disposition Proceeds" means proceeds (including, without limitation,
------------------------
but only as and when paid, any cash received by way of deferred payment pursuant
to a promissory note or similar instrument, receivable or otherwise) received by
or for the account of any Borrower or any Subsidiary of any Borrower from the
sale, lease, transfer or other disposition (including, without limitation, as a
result of any Casualty Loss) of any Equipment or other fixed asset of such
Person, net of (a) the costs of such sale, lease, transfer or other disposition,
including
-19-
reasonable professional fees, taxes payable as a result thereof and reasonable
reserves associated therewith; and (b) amounts applied to the repayment of
indebtedness (other than the Obligations) secured by a Lien on the applicable
fixed asset; provided, that, notwithstanding the foregoing, such net proceeds of
Permitted Dispositions shall not constitute Net Disposition Proceeds, unless and
solely the extent that such net proceeds exceed (i) in the case of a Permitted
Disposition described in clause (a) of the definition of the term "Permitted
Disposition," $1,000,000 and (ii) in the case of a Permitted Disposition
described in clause (b) of the definition of the term "Permitted Disposition,"
$1,500,000.
"Note" shall mean a promissory note of the Borrowers payable to the order
----
of any Lender, in the form of Exhibit B, evidencing the aggregate Indebtedness
of the Borrowers to such Lender resulting from the Loans made by such Lender or
acquired by such Lender pursuant to Section 11.6.
"Notice of Borrowing" shall have the meaning ascribed to that term in
-------------------
Section 2.2(a)(i).
"Notice of Continuation" shall have the meaning ascribed to that term in
----------------------
Section 4.3(a).
"Notice of Conversion" shall have the meaning ascribed to that term in
--------------------
Section 4.3(b).
"Obligations" shall mean (a) the unpaid principal of and interest on the
-----------
Loans and the Notes, (b) the obligation of the Borrowers to pay to an Issuing
Lender the amounts of all Unpaid Drawings together with interest accrued thereon
at the LC Interest Rate, made under Letters of Credit of such Issuing Lender,
(c) the Fees, (d) the Expenses, (e) all other Liabilities of the respective
Borrowers to the Agent and any Lender (in its capacity as such and not in its
capacity as an Issuing Lender), which may arise under, out of, or in connection
with, the Credit Agreement, the Notes, any other Credit Document or any other
document made, delivered or given in connection herewith or therewith, and (f)
all other Liabilities of the respective Borrowers to an Issuing Lender in
respect of its Letters of Credit. As used in clauses (a), (b) and (c) and
wherever else the determination of the amount of "interest" is relevant,
"interest" shall include interest accruing on or after the filing of, or what
would have accrued but for the filing of, any petition in bankruptcy, or the
commencement of any insolvency, reorganization, or like proceeding, relating to
any Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding.
"Other Taxes" shall have the meaning ascribed to that term in Section
-----------
2.8(b).
"Parent" shall mean BWAY Corporation, a Delaware corporation.
------
"Parent Pledge Agreement" means the Stock Pledge Agreement of even date
-----------------------
herewith executed by Parent in favor of Agent.
"Participant" shall have the meaning ascribed to that term in Section 3.4.
-----------
"Payment" shall have the meaning ascribed to that term in Section 2.10.
-------
-20-
"Payment Office" means the office of the Agent located at 130 Liberty
--------------
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or such other office of the Agent as shall be
specified by Agent from time to time in a notice to the other parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any Person
----
succeeding to the functions thereof:
"Permitted Discretion" shall mean the Agent's judgment exercised in good
--------------------
faith based upon its consideration of any factor which the Agent believes in
good faith: (a) will or could adversely affect the value of any Collateral, the
enforceability or priority of the Agent's Liens thereon or the amount which the
Agent, the Lenders or any Issuing Lender would be likely to receive (after
giving consideration to delays in payment and costs of enforcement) in the
liquidation of such Collateral; (b) suggests that any collateral report or
financial information delivered to the Agent by any Person on behalf of any
Borrower is incomplete, inaccurate or misleading in any material respect; (c)
materially increases the likelihood of a bankruptcy, reorganization or other
insolvency proceeding involving any Borrower or any Subsidiary of any Borrower
or any of the Collateral; or (d) creates or reasonably could be expected to
create a Default or Event of Default. In exercising such judgment, the Agent
may consider such factors already included in or tested by the definition of
Eligible Accounts Receivable or Eligible Inventory, as well as any of the
following: (i) the changes in collection history and dilution with respect to
the Accounts; (ii) changes in demand for, and pricing of, Inventory; (iii)
changes in any concentration of risk with respect to the respective Borrowers'
Accounts and Inventory; and (iv) any other factors that change the credit risk
of lending to any Borrower on the security of any Borrowers' Accounts and
Inventory. The burden of establishing lack of good faith hereunder shall be on
the Borrowers.
"Permitted Dispositions" shall mean the sale of (a) certain real property
----------------------
of BMI located in Xxxxxxxx, Xxxxxx County, Texas, and commonly known as 13401
Xxxxxx Drive, Farmers Branch, and (b) certain surplus equipment of the
Borrowers; provided, that (x) in the case of each of such sales, one hundred
percent (100%) of the consideration is received by the applicable Borrower in
the form of cash and (y) in the case of any item of such surplus equipment, to
the extent such item is set forth on a schedule delivered to the Agent within
thirty (30) days after the Closing Date describing such equipment in such detail
and with such specificity as shall in each case be satisfactory to the Agent in
its sole and absolute discretion.
"Permitted Liens" shall have the meaning ascribed to that term in Section
---------------
8.4.
"Permitted Restrictive Covenant" shall mean (a) any covenant or restriction
------------------------------
contained in any Credit Document, (b) any covenant or restriction binding upon
any Person at the time such Person becomes a Subsidiary of any Borrower if the
same is not created in contemplation thereof, (c) any covenant or restriction of
the type contained in Section 8.4 that is contained in any contract evidencing
or providing for the creation of or concerning Indebtedness secured by any
Purchase Money Lien so long as such covenant or restriction is limited to the
property purchased therewith, (d) any covenant or restriction described in
Schedule 8.12, but only to the extent such covenant or restriction is there
identified by specific reference to the provision of the contract in which such
covenant or restriction is contained or (e) any covenant or restriction that (i)
is not more burdensome than an existing Permitted Restrictive Covenant that is
such by virtue
-21-
of clause (b), (c), (d) or (e); (ii) is contained in a contract constituting a
renewal, extension or replacement of the contract in which such existing
Permitted Restrictive Covenant is contained; and (iii) is binding only on the
Person or Persons bound by such existing Permitted Restrictive Covenant.
"Person" shall mean any individual, sole proprietorship, partnership, joint
------
venture, trust, unincorporated organization, association, corporation, limited
liability company, institution, entity, party or government (including any
division, agency or department thereof), and, as applicable, the successors,
heirs and assigns of each.
"Plan" shall mean any employee benefit plan, program or arrangement,
----
whether oral or written, maintained or contributed to by any Borrower, any
Subsidiary of any Borrower or any ERISA Affiliate, or with respect to which any
Borrower, any Subsidiary of any Borrower or any ERISA Affiliate, may incur
liability.
"Prime Lending Rate" shall mean the rate that Deutsche Bank AG, New York
------------------
Branch announces from time to time in New York, New York as its prime lending
rate in the United States, as in effect from time to time. The Prime Lending
Rate is a reference rate and does not necessarily represent the lowest or best
rate actually charged to any customer. Deutsche Bank AG, New York Branch, BTCo
and each of the other Lenders may make commercial loans or other loans at rates
of interest at, above or below the Prime Lending Rate.
"Prime Rate Loan" shall mean a Loan that bears, or is to bear, interest by
---------------
reference to the Prime Lending Rate.
"Prohibited Transaction" shall mean any transaction that is prohibited
----------------------
under Code Section 4975 or ERISA Section 406 and not exempt under Code Section
4975 or ERISA Section 408.
"Proportionate Share" shall, subject to Section 11.18(c), mean, with
-------------------
respect to any Lender, a fraction (expressed as a percentage), the numerator of
which shall be the amount of such Lender's Commitment and the denominator of
which shall be the Total Commitments or, if the Commitments have been
terminated, a fraction the numerator of which shall be the principal amount of
such Lender's Exposure and the denominator of which shall be the aggregate
amount of all Exposures of all Lenders then outstanding.
"Purchase Money Liens" shall mean Liens on any item of Equipment of any
--------------------
Borrower acquired after the date of this Credit Agreement to secure the purchase
price thereof, provided that: (a) each such Lien shall attach only to the
property to be acquired; (b) a description is furnished to the Agent for any
property so acquired, the purchase price of which is greater than $500,000; and
(c) the debt incurred in connection with such acquisitions shall not exceed one
hundred percent (100%) of the amount of the purchase price of such items of
Equipment then being financed.
"Real Estate" shall mean all real property owned or leased by any Borrower
-----------
or any Subsidiary of any Borrower, together with all fixtures, improvements and
other structures thereon.
-22-
"Reduced Rate" shall have the meaning ascribed to that term in Section
------------
2.8(e), relating to backup withholding tax.
"Regulation D" shall mean Regulation D of the Board of Governors of the
------------
Federal Reserve System as from time to time in effect and any successor thereto.
"Reportable Event" shall mean any of the events described in Section 4043
----------------
of ERISA and the regulations thereunder.
"Requirement of Law" shall mean, as to any Person, the Governing Documents
------------------
of such Person, and any law, treaty, rule, regulation, direction, ordinance,
criterion or guideline or determination of a court or other Governmental
Authority or determination of an arbitrator, in each case applicable to or
binding upon such Person or any of its property or to which such Person or any
of its property is subject.
"Responsible Officer" shall mean, as to any Person, the duly-appointed
-------------------
chief executive officer, chief financial officer or treasurer, or a vice
president or any other duly-appointed officer, in each case of such Person.
"Restricted Payment" means, with respect to any Person, (a) any payment
------------------
with respect to or on account of any of the Capital Securities of such Person,
including any dividend or other distribution on, any payment of interest on or
principal of, and any payment on account of any purchase, redemption,
retirement, exchange, defeasance or conversion of, or on account of any claim
relating to or arising out of the offer, sale or purchase of, any such Capital
Securities and (b) any optional payment or prepayment on or redemption
retirement (including by making payments to a sinking or analogous fund),
repurchase, defeasance or other acquisition of, any Indebtedness (other than
Indebtedness pursuant to this Credit Agreement). For the purposes of this
definition, a "payment" shall include the transfer of any asset or the
incurrence of any Indebtedness or other Liability (the amount of any such
payment to be the fair market value of such asset or the amount of such
obligation, respectively) but shall not include the issuance by such Person to
the holders of a class or series of a class of its Capital Securities of the
same class and, if applicable, series, other than, in the case of any Borrower
or any Subsidiary of any Borrower, Mandatorily Redeemable Obligations.
"Serving Affiliate" shall mean an Affiliate that is an Issuing Lender.
-----------------
"Settlement Date" shall have the meaning ascribed to that term in Section
---------------
2.3(b)(i).
"Start Date" shall mean, with respect to any Applicable Margin Period, the
----------
first day of such Applicable Margin Period.
"Stated Amount" of each Letter of Credit means, at any time, the maximum
-------------
amount available to be drawn thereunder at such time (in each case determined
without regard to whether any conditions to drawing could then be met).
"Subordinated Note Documents" means, collectively, the Subordinated Note
---------------------------
Indenture, the Subordinated Notes and all other agreements, instruments and
documents executed and/or delivered by Parent and any other Credit Party
pursuant thereto or in connection therewith,
-23-
without giving effect to any modifications, extensions or restatements thereof
or amendments or supplements thereto, except for any of the foregoing previously
consented to in writing by the Agent.
"Subordinated Note Indenture" means that certain Indenture dated as of
---------------------------
April 11, 1997, among the Credit Parties and the Subordinated Note Trustee,
without giving effect to any modifications, extensions or restatements thereof
or amendments or supplements thereto, except for any of the foregoing previously
consented to in writing by the Agent.
"Subordinated Note Trustee" shall mean Xxxxxx Trust and Savings Bank,
-------------------------
acting in its capacity as trustee under the Subordinated Indenture, and all
Persons succeeding thereto in such capacity pursuant to the terms of thereof.
"Subordinated Notes" shall have the meaning ascribed to the term "Notes" in
------------------
the Subordinated Note Indenture.
"Subsidiary" means, with respect to any Person at any time (a) any other
----------
Person the accounts of which would be consolidated with those of such first
Person in its consolidated financial statements as of such time, and (b) any
other Person (i) that is, at such time, Controlled by, or (ii) securities of
which having ordinary voting power to elect a majority of the board of directors
(or other persons having similar functions), or other ownership interests of
which ordinarily constituting a majority voting interest, are at such time,
directly or indirectly, owned or Controlled by such first Person, or by one or
more of its Subsidiaries, or by such first Person and one or more of its
Subsidiaries.
"Super Majority Lenders" shall mean, at any time, those Lenders having more
----------------------
than 66-2/3% of the aggregate amount of the Commitments or, if the Commitments
shall have expired or been terminated, Lenders having more than 66-2/3% of the
aggregate amount of the outstanding Exposures.
"Syndication Date" shall mean the earlier of (a) the date which is ninety
----------------
(90) days after the Closing Date and (b) the date on which the Agent notifies
the Funds Administrator that the primary syndication has been completed, as
determined by the Agent in its sole discretion, which notice shall be promptly
given.
"Tax Transferee" shall have the meaning ascribed to that term in Section
--------------
2.8(a).
"Taxes" shall have the meaning ascribed to that term in Section 2.8(a).
-----
"Termination Event" shall mean (a) a Reportable Event with respect to any
-----------------
Benefit Plan or Multiemployer Plan; (b) the withdrawal of any Borrower, any
Subsidiary of any Borrower or any ERISA Affiliate from a Benefit Plan during a
plan year in which such entity was a "substantial employer" as defined in
Section 4001(a) (2) of ERISA; (c) the providing of notice of intent to terminate
a Benefit Plan in a distress termination described in Section 4041(c) of ERISA
or the treatment of any amendment as a termination under Section 4041(e) of
ERISA; (d) the institution by the PBGC of proceedings to terminate a Benefit
Plan or Multiemployer Plan; (e) any event or condition (i) that might constitute
grounds under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Benefit Plan or
-24-
Multiemployer Plan, or (ii) that may result in termination of a Multiemployer
Plan pursuant to Section 4041A of ERISA; or (f) the partial or complete
withdrawal within the meaning of Sections 4203 and 4205 of ERISA, of any
Borrower, any Subsidiary of any Borrower or any ERISA Affiliate from a
Multiemployer Plan.
"Test Date" shall mean, with respect to any Start Date, the last day of the
---------
most recent Fiscal Quarter ended immediately prior to such Start Date.
"Test Period" shall mean each period of four consecutive Fiscal Quarters
-----------
then last ended (in each case taken as one accounting period).
"Total Commitments" shall mean the aggregate of the Commitments of all the
-----------------
Lenders, which in the aggregate shall not exceed $90,000,000.
"Total Exposure" shall mean, at any time, an amount equal to the sum at
--------------
such time of (a) the Letter of Credit Outstandings and (b) the aggregate
principal amount of outstanding Loans.
"Type" shall mean, with respect to any Loan, whether such Loan is a LIBOR
----
Rate Loan or a Prime Rate Loan.
"UCC" shall mean the Uniform Commercial Code as in effect from time to time
---
in the State of New York; provided that if, with respect to any financing
statement or by reason of any provisions of law, the perfection or the effect of
perfection or non-perfection of the Liens granted to the Agent pursuant to the
applicable Credit Document is governed by the Uniform Commercial Code as in
effect in a jurisdiction of the United States other than the State of New York.
"UCC" shall mean the Uniform Commercial Code as in effect from time to time in
such other jurisdiction for purposes of the provisions of this Credit Agreement,
each Credit Document and any financing statement relating to such perfection or
effect of perfection or non-perfection.
"Unpaid Drawing" shall have the meaning ascribed to such term in Section
--------------
3.5(a).
"Unused Line Fee" shall have the meaning ascribed to that term in Section
---------------
4.5.
"Wholly Owned Subsidiary" shall mean, with respect to any Person, any
-----------------------
Subsidiary of such Person all of the Capital Securities of which (except
directors' qualifying shares) are, directly or indirectly, owned or Controlled
by such Person or one or more Wholly Owned Subsidiaries of such Person or by
such Person and one or more of such Subsidiaries.
1.2 Accounting Terms and Determinations. Unless otherwise defined or
-----------------------------------
specified herein, all accounting terms used herein shall have the meanings
customarily given in accordance with GAAP, and all financial computations to be
made under this Credit Agreement shall, unless otherwise specifically provided
herein, be made in accordance with GAAP applied on a basis consistent in all
material respects with the Financial Statements delivered to the Agent and the
Lenders on the Closing Date. All accounting determinations for purposes of
determining compliance with Section 8.1 shall be made in accordance with GAAP as
in effect on the Closing Date and applied on a basis consistent in all material
respects with the Financial Statements delivered to the Agent and the Lenders on
the Closing Date. The Financial Statement required to
-25-
be delivered hereunder from and after the Closing Date and all financial records
shall be maintained in accordance with GAAP as in effect as of the date of the
Financial Statements delivered to the Agent and the Lenders on the Closing Date
or, if GAAP shall change from the basis used in preparing the Financial
Statements delivered to the Agent and the Lenders on the Closing Date, the
certificates required to be delivered pursuant to Section 7.1 demonstrating
compliance with the covenants contained herein shall include calculations
setting forth the adjustments necessary to demonstrate how the Borrowers are in
compliance with the financial covenants based upon GAAP as in effect on the
Closing Date. If any Borrower shall change its method of inventory accounting
from the first-in-first-out method to the last-in-last-out method, all
calculations necessary to determine compliance with the covenants contained
herein shall be made as if such method of inventory accounting had not been so
changed.
1.3 Other Interpretive Provisions. Terms not otherwise defined herein
-----------------------------
which are defined in the UCC shall have the meanings given them in the UCC. The
words "hereof," "herein" and "hereunder" and words of similar import when used
in this Credit Agreement shall refer to this Credit Agreement as a whole and not
to any particular provision of this Credit Agreement, and references to Article,
Section, Annex, Schedule, Exhibit and like references are references to this
Credit Agreement unless otherwise specified. Any item or list of items set forth
following the word "including," "include" or "includes" is set forth only for
the purpose of indicating that, regardless of whatever other items are in the
category in which such item or items are "included," such item or items are in
such category, and shall not be construed as indicating that the items in the
category are limited to such items or to items similar to such items. An Event
of Default shall "continue" or be "continuing" until such Event of Default has
been waived in accordance with Section 11.10. Except as otherwise specified
herein, all references herein (a) to any Person shall be deemed to include such
Person's successors and assigns, (b) to any Requirement of Law defined or
referred to herein shall be deemed references to such Requirement of Law or any
successor Requirement of Law as the same may have been or may be amended or
supplemented from time to time and (c) to any Credit Document or Collateral
Document defined or referred to herein shall be deemed references to such Credit
Document or Collateral Document (and, in the case of any Note or any other
instrument, any instrument issued in substitution therefor) as the terms thereof
may have been or may be amended, supplemented, waived or otherwise modified from
time to time, provided that, in the case of any Letter of Credit, any such
amendment, supplement, waiver or other modification shall have been approved in
writing by the Agent. Whenever the context so requires, the neuter gender
includes the masculine or feminine, the masculine gender includes the feminine,
and the singular number includes the plural, and vice versa. Except as otherwise
specified herein, all references to the time of day shall be deemed to be to New
York City time as then in effect .
ARTICLE 2
LOANS
-----
2.1 Commitments; Delivery of Notes. (a) Subject to the terms and
------------------------------
conditions set forth in this Credit Agreement, on and after the Closing Date and
to and excluding the Expiration Date, each of the Lenders severally agrees to
make from time to time loans and advances to the Borrowers hereunder on a joint
and several basis (the "Loans"); provided that no such Loan shall be made if,
after giving effect to the making of such Loan and the simultaneous application
-26-
of the proceeds thereof, (i) the aggregate amount of the Exposure of such Lender
would exceed the Commitment of such Lender or (ii) Total Exposure would exceed
the lesser of (A) the Total Commitments and (B) subject to Section 2.2(b), the
Borrowing Base.
(b) The Borrowers hereby agree to execute and deliver to each Lender a
Note to evidence the Loans to the Borrowers by such Lender.
2.2 Borrowing Mechanics.
-------------------
(a) Except as provided in Sections 2.2(b), 2.3(b) and 3.5(a), Borrowings
shall be made on notice from the Funds Administrator to the Agent, given not
later than 12:00 noon on the Business Day on which a proposed Borrowing
consisting of Prime Rate Loans is requested to be made and on the third Business
Day prior to the date of any proposed Borrowing consisting of LIBOR Rate Loans
is requested to be made.
(i) Each Notice of Borrowing shall be given by, alternatively,
telephone, facsimile or electronic E-mail transmission, and, if by telephone or
electronic E-mail transmission, confirmed in writing, substantially in the form
of Exhibit C (the "Notice of Borrowing"). Each Notice of Borrowing shall be
irrevocable by and binding on the Funds Administrator and the Borrowers.
(ii) The Funds Administrator shall notify the Agent in writing of the
names of the employees of the Funds Administrator authorized to request Loans on
behalf of the Borrowers and specifying which of those employees are also, or, if
none are, the employees that are, authorized to direct the disbursement of Loans
in a manner contrary to standing disbursement instructions, and shall provide
the Agent with a specimen signature of each such employee. In the absence of a
specification of those employees who are authorized to vary standing
disbursement instructions, the Agent may assume that each employee authorized to
request Loans also has such authority. The Agent shall be entitled to rely
conclusively on the authority of such employees of the Funds Administrator to
request Loans on behalf of the Borrowers, or to vary standing disbursement
instructions, until the Agent receives written notice to the contrary. The Agent
shall have no duty to verify the authenticity of the signature appearing on any
Notice of Borrowing or other writing delivered pursuant to this Section 2.2(a)
and, with respect to an oral or electronic E-mail request for Loans, the Agent
shall have no duty to verify the identity of any individual representing himself
as one of the employees of the Funds Administrator authorized to make such
request on behalf of the Borrowers. Neither the Agent nor any of the Lenders
shall incur any liability to the Funds Administrator or any of the Borrowers as
a result of (a) acting upon any telephonic or electronic E-mail notice referred
to in this Section 2.2(a) if the Agent believes in good faith such notice to
have been given by a duly authorized employee of the Funds Administrator or
other individual authorized to request Loans on behalf of the Borrowers or to
direct the disbursement thereof in a manner contrary to standing disbursement
instructions, or (b) otherwise acting in good faith under this Section 2.2(a)
and an advance made and disbursed pursuant to any such telephonic or electronic
E-mail notice shall be deemed to be a Loan for all purposes of this Credit
Agreement.
(iii) In its Notice of Borrowing, the Funds Administrator may request one
or more Borrowings on a single day. Each such Borrowing shall, unless otherwise
specifically
-27-
provided herein, consist entirely of Loans of the same Type and shall, in the
case of a Borrowing of LIBOR Rate Loans, be in an aggregate amount for all
Lenders of not less than $5,000,000 or an integral multiple of $1,000,000 in
excess thereof. The right of the Funds Administrator to choose LIBOR Rate Loans
is subject to the provisions of Section 4.3(c).
(b) (i) In the event the Borrowers are unable to comply with (A) the
Borrowing Base limitation set forth in clause (ii)(B) of the proviso to Section
-------
2.1(a) or (B) the conditions precedent set forth in Section 5.2 to a Credit
Event, the Lenders authorize the Agent, in its sole discretion, to make Loans
("Interim Advances") to the Borrowers during the period commencing on the date
the Agent first receives a Notice of Borrowing requesting an Interim Advance
until the earliest of (1) the twentieth (20/th/) Business Day after such date,
(2) the date the Borrowers are again able to comply with such Borrowing Base
limitation and conditions precedent, or obtains an amendment or waiver with
respect thereto and (3) the date the Majority Lenders instruct the Agent, or the
Agent determines, to cease making Interim Advances (in each case, the "Interim
Advance Period").
(ii) The Agent shall not, in any event, (A) make any Interim Advance
during any Interim Advance Period if, after giving effect to such Interim
Advance, Total Exposure would exceed one hundred ten percent (110%) of Total
Exposure on the first day of such Interim Advance Period (calculated without
-----
giving effect to Interim Advances made on such day) and (B) make any Interim
Advance if, after giving effect to such Interim Advance, Total Exposure would
exceed the Line of Credit.
(iii) All amounts received by the Agent during an Interim Advance
Period on account of the Obligations, whether in the form of payments from any
Borrower, collections on the Collateral or otherwise, shall, so long as any
Interim Advances made during such Interim Advance Period are outstanding, be
applied by the Agent, first, to the repayment of such Interim Advances and,
-----
second , in accordance with Section 2.5(d).
------
(c) The failure of any Lender to make the Loan to be made by it as part of
any Borrowing shall not relieve any other Lender of its obligation, if any,
hereunder to make its Loan on the date of such Borrowing, but no Lender shall be
responsible for the failure of any other Lender to make the Loan to be made by
such other Lender on the date of any Borrowing.
(d) In addition to being evidenced, as provided in Section 2.6, by the
Borrowers' Account, each Lender's Loans and the Borrowers' joint and several
obligations to repay such Loans with interest in accordance with the terms of
this Credit Agreement shall be evidenced by this Credit Agreement, the records
of such Lender and such Lender's Note. The records of each Lender shall be prima
facie evidence of such Lender's Loans and accrued interest thereon and of all
payments made in respect thereof.
(e) Each Lender shall be entitled to earn interest at the then applicable
rate of interest, calculated in accordance with Article 4, on outstanding Loans
which it has funded to the Agent; provided that in the case of interest accrued
but unpaid at the time of a Bankruptcy Default and interest accruing thereafter
and during a Bankruptcy Default, such Lender shall be entitled to receive only
its Proportionate Share of amounts actually received by the Agent in respect of
such interest; further provided that if any amount received by the Agent in
respect of such interest
-28-
and distributed by it is thereafter recovered from the Agent, such Lender shall,
upon request, repay to the Agent its Proportionate Share of the amount so
recovered to the extent received by it, but without interest (unless the Agent
is required to pay interest on the amount recovered, in which case such Lender
shall be required to pay interest at a like rate).
(f) Notwithstanding the obligation of the Funds Administrator to send
written confirmation of a Notice of Borrowing made by the Funds Administrator by
telephone or electronic E-mail transmission if and when requested by the Agent,
in the event that the Agent agrees to accept a Notice of Borrowing made by the
Funds Administrator by telephone or electronic E-mail transmission, such Notice
of Borrowing shall be binding on the Funds Administrator and each Borrower
whether or not written confirmation is sent by the Funds Administrator or
requested by the Agent. The Agent may act prior to the receipt of any requested
written confirmation, without any liability whatsoever, based upon telephonic or
electronic E-mail notice believed by the Agent in good faith to be from The
Funds Administrator or its agents. The Agent's records of the terms of any
telephonic or electronic E-mail transmission Notices of Borrowing shall be
conclusive on the Funds Administrator and each Borrower and Lender in the
absence of gross negligence or willful misconduct on the part of the Agent in
connection therewith.
2.3 Settlements Among the Agents and the Lenders.
--------------------------------------------
(a) Except as provided in Section 2.3(b), the Agent shall give to each
Lender prompt notice of each Notice of Borrowing by telecopy or facsimile
transmission. No later than 3:00 P.M. on the date of receipt of each Notice of
Borrowing (unless such Notice of Borrowing specifies the Closing Date as the
date of Borrowing, in which case no later than 12:00 noon on the Closing Date),
each Lender will make available for the account of its Applicable Lending
Office, to the Agent at the address of the Agent set forth on Annex II, in
immediately available funds, its Proportionate Share of such Borrowing requested
to be made. Unless the Agent shall have been notified by any Lender prior to the
date of Borrowing that such Lender does not intend to make available to the
Agent its portion of the Borrowing to be made on such date, the Agent may assume
that such Lender will make such amount available to the Agent on the Settlement
Date and the Agent, in reliance upon such assumption, may but shall not be
obligated to make available the amount of the Borrowing to be provided by such
Lender. If and to the extent such Lender shall not have so made available to the
Agent its Proportionate Share on such date and the Agent shall have so made
available to the Borrowers a corresponding amount on behalf of such Lender, the
Agent may recover such amount on demand from such Lender in accordance with
Section 11.18. If such Lender does not pay such corresponding amount promptly
upon the Agent's demand therefor, the Agent may promptly notify the Funds
Administrator and the Borrowers shall immediately repay such corresponding
amount to the Agent together with accrued interest thereon at the applicable
rate or rates provided in Sections 4.1, 4.2, and 4.4.
(b) Unless the Majority Lenders have instructed the Agent to the contrary,
the Agent on behalf of the Lenders may but shall not be obligated to make Prime
Rate Loans under Section 2.2 without prior notice of the proposed Borrowing to
the Lenders, subject to the following settlement arrangements:
-29-
(i) The amount of each Lender's Proportionate Share of Loans shall be
computed weekly (or more frequently in the Agent's discretion) and shall be
adjusted upward or downward on the basis of the amount of outstanding Loans as
of 5:00 P.M. on the last Business Day of the period specified by the Agent (such
date, the "Settlement Date"). The Agent shall deliver to each of the Lenders
promptly after the Settlement Date a summary statement of the amount of
outstanding Loans for such period. The Lenders shall transfer to the Agent, or,
subject to Section 11.18(c)(i), the Agent shall transfer to the Lenders, such
amounts as are necessary so that (after giving effect to all such transfers) the
amount of Loans made by each Lender shall be equal to such Lender's
Proportionate Share of the aggregate amount of Loans outstanding as of such
Settlement Date. During a Bankruptcy Default, amounts required to be transferred
by the Lenders to the Agent shall, instead of constituting Loans to the
Borrowers, be in the form of participations purchased by the Lenders in the
outstanding Loans of BTCo. If the summary statement is received by the Lenders
prior to 12:00 noon on any Business Day, each Lender shall make the transfers
described above in immediately available funds no later than 3:00 P.M. on the
day such summary statement was received; and if such summary statement is
received by the Lenders after 12:00 noon on such day, each Lender shall make
such transfers no later than 3:00 P.M. on the next succeeding Business Day. The
obligation of each of the Lenders to transfer such funds shall be irrevocable
and unconditional and without recourse to or warranty by the Agent. Each of the
Agent and the Lenders agrees to xxxx its books and records on the Settlement
Date to show at all times the dollar amount of its Proportionate Share of the
outstanding Loans.
(ii) To the extent that the settlement described above shall not yet have
occurred, upon repayment of Loans by the Borrowers, the Agent may first
apply such amounts repaid directly to the amounts made available by the
Agent pursuant to this Section 2.3(b).
(iii) Because the Agent on behalf of the Lenders may be advancing and/or
may be repaid Loans prior to the time when the Lenders will actually advance
and/or be repaid Loans, interest with respect to Loans shall be allocated by the
Agent to each Lender and the Agent in accordance with the amount of Loans
actually advanced by and repaid to each Lender and the Agent and shall accrue
from and including the date such Loans are so advanced to but excluding the date
such Loans are either repaid by the Borrowers in accordance with Section 2.4 or
actually settled by the applicable Lender as described in this Section 2.3(b).
2.4 Mandatory Repayments: Mandatory Reduction of Commitments.
--------------------------------------------------------
(a) Except during an Interim Advance Period, the amount by which Total
Exposure exceeds the Borrowing Base at any time shall be immediately due and
payable without the necessity of any notice or demand. Repayments of such excess
amounts shall be applied, first, to the repayment of Loans, second, to the
----- ------
payment of outstanding reimbursement obligations with respect to Letters of
Credit, and, third, to the securing, with cash or Cash Equivalents as provided
-----
in the second paragraph of Section 9.2 (but without the requirement of any
demand provided for in such paragraph), of the Letter of Credit Outstandings (in
each case to the extent the same are such by virtue of clause (a) of the
definition thereof).
(b) (i) On the Expiration Date, the Commitment of each Lender shall
automatically reduce to zero and may not be reinstated.
-30-
(ii) The Borrowers may reduce or terminate the Line of Credit at any
time and from time to time in whole or in part, without premium or penalty, by
reducing or terminating the Commitments, any such reduction or termination to be
pro rata on the amounts at the time of the Commitments; provided that each such
reduction must be in an amount not less than $5,000,000 (and in increments of
$1,000,000); and provided further that (A) if the Borrowers seek to reduce the
Line of Credit to an amount less than $25,000,000, then the Line of Credit shall
be reduced to zero and the Credit Agreement shall be terminated and (B) once
reduced the amount of any such reductions in the Line of Credit may not be
reinstated.
(iii) The amount by which Total Exposure exceeds the aggregate amount
of the Commitments at any time shall be immediately due and payable without the
necessity of any notice or demand. Repayments of such excess amounts shall be
applied, first, to the repayment of Loans, second, to the payment of outstanding
----- ------
reimbursement obligations with respect to Letters of Credit, and, third, to the
-----
securing, with cash or Cash Equivalents as provided in the second paragraph of
Section 9.2 (but without the requirement of any demand provided for in such
paragraph), of the Letter of Credit Outstandings (in each case to the extent the
same are such by virtue of clause (a) of the definition thereof).
2.5 Payments and Computations.
-------------------------
(a) (i) The Borrowers shall, subject, in the case of payments in
respect of Letters of Credit, to Section 3.5, make each payment under the Credit
Documents and under the Notes not later than 2:00 P.M. on the day when due in
Dollars to the Agent at the Payment Office in immediately available funds. The
obligations of the Borrowers to the Lenders with respect to such payments shall
be discharged by making such payments to the Agent pursuant to this Section 2.5
or by the Agent, in its discretion, adding such payments to the principal amount
of the Loans outstanding by charging such payments to the Borrowers' Account
pursuant to Section 2.6.
(ii) Amounts payable by the Borrowers in respect of any Letter of
Credit should be made by the Funds Administrator to the Agent.
(a) (i) On or prior to the Closing Date BMI and MCC (and, after the
Closing Date, any other Borrower requested from time to time by Agent) shall
establish and shall maintain one or more Lockboxes (with respect to each such
Borrower, such Borrower's "Lockboxes") and shall instruct all account debtors on
the Accounts of such Borrower to remit all payments to such Borrower's
Lockboxes. All amounts received by any Borrower from any account debtor, in
addition to all other cash received from any other source (including, without
limitation, Net Disposition Proceeds of dispositions permitted pursuant to
Section 8.5) shall upon receipt be deposited into a Depositary Account.
(ii) Each Borrower, the Agent and one or more financial institutions
selected by such Borrower and acceptable to the Agent (each a "Depositary
Account Bank") shall enter into agreements in form and substance satisfactory to
the Agent (each a "Depositary Account Agreement"), providing, among other
things, that (A) the Agent will open an account at each Depositary Account Bank
(each a "Depositary Account") and (B) all receipts received in the
-31-
Lockboxes of each Borrower shall be transferred at the end of each day to the
appropriate Depositary Account.
(iii) The closing of any Lockbox or Depositary Account and the
termination of any Depositary Account Agreement shall require in each case the
prior written consent of the Agent.
(c) Upon the terms and subject to the conditions set forth in the
applicable Depositary Account Agreement, all available amounts held in each
Depositary Account shall be wired each Business Day into an account (the "BT
Account") maintained by the Agent at BTCo.
(d) (i) All amounts received by the Agent for distribution hereunder
shall, subject to Section 2.2(b)(iii), be distributed in the following order:
first, to the payment of any Fees, Expenses or other
-----
Obligations due and payable to the Agent under any of the Credit
Documents, including amounts advanced by the Agent on behalf of the
Lenders pursuant to Section 2.3(b);
second, during a Bankruptcy Default, to the payment of the
------
unpaid principal amounts of all Unpaid Drawings payable to each
Issuing Lender, together with accrued but unpaid interest thereon at
the LC Interest Rate;
third, to the ratable payment of any Fees and other Obligations
-----
due and payable to the Lenders under any of the Credit Documents,
other than to a Lender in its capacity as an Issuing Lender and other
than those Obligations specifically referred to in this Section
2.5(d)(i);
fourth, to the ratable payment of interest due on the Loans;
------
fifth, to the ratable payment of principal due on the Loans;
-----
sixth, to the ratable payment of other Liabilities not
-----
specifically referred to in this Section 2.5(d) due and payable to the
Lenders (in their capacities as such, and not in their capacity as an
Issuing Lender) under the Credit Documents; and
seventh, to the ratable payment of other Liabilities not
-------
specifically referred to in this Section 2.5(d) due and payable to the
Issuing Lenders with respect to Letters of Credit.
(ii) Each Person receiving a payment from the Agent pursuant to
Section 2.5(d)(i) shall, for all purposes of this Credit Agreement and other
Credit Documents, be deemed to have applied that payment in the order specified
in Section 2.5(d)(i).
2.6 Maintenance of Account. The Agent shall maintain an account
----------------------
("Borrowers' Account") on its books in the name of the Borrowers in which the
Borrowers will be charged with all loans and advances made by the Lenders to the
Borrowers or for the Borrowers' account, including the Loans, the Fees, the
Expenses and any other Obligations. The Borrowers will be credited, in
accordance with Section 2.5 above, with all amounts received by the Agent or the
-32-
Lenders from the Borrowers or from others for the Borrowers' account, including,
as set forth above, all amounts received by the Agent in payment of Accounts.
In no event shall prior recourse to any Accounts or other Collateral be a
prerequisite to the Agent's right to demand payment of any Obligation upon its
maturity. Further, the Agent shall have no obligation whatsoever to perform in
any respect any of the contracts or obligations relating to the Accounts.
2.7 Statement of Account. After the end of each month, the Agent shall
--------------------
send the Funds Administrator a statement accounting for the charges, loans,
advances and other transactions occurring among and between the Agent, the
Lenders, the Funds Administrator and the Borrowers during that month. In the
event that the Funds Administrator does not object in writing to any information
reflected in any such monthly statement within thirty (30) days of its receipt
thereof, such statement shall, absent manifest error, be an account stated,
which is final, conclusive and binding on the Borrowers.
2.8 Withholding and Other Taxes.
---------------------------
(a) Any and all payments by the Borrowers hereunder, under the Notes or in
respect of Letters of Credit which are made, to or for the benefit of any Lender
(whether in its capacity as a Lender or an Issuing Lender, and as used in
Section 2.8, the term "Lender" shall mean a Lender in each such capacity, and
shall also include each Serving Affiliate of such Lender) or the Agent shall be
made, free and clear of and without deduction for any and all present or future
taxes, levies, imposts, deductions, charges or withholdings and penalties,
interests and all other liabilities with respect thereto ("Taxes"), excluding,
(i) in the case of each such Lender, or the Agent, Taxes imposed on its net
income (including any Taxes imposed on branch profits) and franchise taxes
imposed on it by the jurisdiction under the laws of which such Lender, or the
Agent (as the case may be) is organized or any political subdivision thereof,
(ii) in the case of each such Lender, Taxes imposed on its net income (including
any Taxes imposed on branch profits), and franchise Taxes imposed on it, by the
jurisdiction of such Lender's Applicable Lending Office or any political
subdivision thereof, (iii) in the case of each such Lender, and the Agent, any
Taxes that are in effect and that would apply to a payment of such Lender, or
Agent, as applicable, as of the Closing Date, and (iv) if any Person acquires
any interest in this Credit Agreement, any Note or any participation interest in
any Letter of Credit pursuant to the provisions hereof, or a Foreign Lender or
the Agent changes the office in which any Loan or any participation interest in
any Letter of Credit is made, accounted for or booked, or a Foreign Lender or an
Issuing Lender changes the office at which any Letter of Credit is maintained
(any such Person, or such Foreign Lender or the Agent in that event, being
referred to as a "Tax Transferee"), any Taxes to the extent that they are in
effect and would apply to a payment to such Tax Transferee as of the date of the
acquisition of such interest or changes in office, as the case may be (all such
nonexcluded Taxes being hereinafter referred to as "Covered Taxes"). If any
Borrower shall be required by law to deduct any Covered Taxes from or in respect
of any sum payable hereunder, under any Note or in respect of any Letter of
Credit to or for the benefit of any Lender, the Agent or any Tax Transferee, (A)
the sum payable shall be increased as may be necessary so that after making all
required deductions of Covered Taxes (including deductions of Covered Taxes
applicable to additional sums payable under this Section 2.8) such Lender, the
Agent or such Tax Transferee, as the case may be, receives an amount equal to
the sum it would have received had no such deductions been made, (B) such
Borrower shall make
-33-
such deductions and (C) such Borrower shall pay the full amount so deducted to
the relevant taxation authority or other authority in accordance with applicable
law.
(b) In addition, each Borrower agrees to pay any present or future stamp,
documentary, excise, privilege, intangible or similar levies that arise at any
time or from time to time (i) from any payment made under any and all Credit
Documents, (ii) from the transfer of the rights of any Lender under any Credit
Documents to any transferee or (iii) from the execution or delivery by any
Credit Party of, or from the filing or recording or maintenance of, or otherwise
with respect to the exercise by the Agent or the Lenders of their rights under,
any and all Credit Documents (hereinafter referred to as "Other Taxes").
(c) The Borrowers will jointly and severally indemnify each Lender, the
Agent, and any Tax Transferee for the full amount of (i) Covered Taxes imposed
on or with respect to amounts payable hereunder under any Note or in respect of
any Letter of Credit, (ii) Other Taxes and (iii) any Taxes other than Covered
Taxes imposed by any jurisdiction on amounts payable under this Section 2.8 paid
by such Lender, the Agent or such Tax Transferee, as the case may be, and any
liability (including penalties, interest and expenses) arising solely therefrom
or with respect thereto whether or not such Taxes were correctly or legally
asserted by the relevant governmental taxing authority. Payment of this
indemnification shall be made within thirty (30) days from the date such Lender,
the Agent or such Tax Transferee certifies and sets forth in writing and in
reasonable detail the calculation thereof as to the amount and type of such
Taxes. Any such certificate submitted by such Lender, the Agent or such Tax
Transferee in good faith to Borrowers shall, absent manifest error, be final,
conclusive and binding on all parties.
(d) Within 30 days after having received a receipt for Covered Taxes or
Other Taxes, the Funds Administrator will furnish to the Agent, at its address
referred to in Section 11.5, the original or a certified copy of a receipt
evidencing payment thereof.
(e) On or before the Closing Date, each Foreign Lender shall deliver to
the Agent and the Funds Administrator (i) two valid, duly completed copies of
either IRS Form W-8BEN or W-8EC1 or successor applicable form, as the case may
be., and any other required form, certifying in each case that such Foreign
Lender is entitled to receive payments under this Credit Agreement, the Notes or
any Letter of Credit payable to it without deduction or withholding of any
United States federal income taxes or with such withholding imposed at a reduced
rate (the "Reduced Rate") and (ii) a valid, duly completed IRS Form W-8 or W-9
or successor applicable form, as the case may be, to establish an exemption
front United States backup withholding tax. Each such Foreign Lender shall also
deliver to the Agent and the Funds Administrator two further copies of said Form
W-8BEN or W-8EC1, or successor applicable forms, or other manner of required
certification, as the case may be, on or before the date that any such form
expires or becomes obsolete or otherwise is required to be resubmitted as a
condition to obtaining an exemption from a required withholding of United States
federal income tax or entitlement to having such withholding imposed at the
Reduced Rate or after the occurrence of any event requiring a change in the most
recent form previously delivered by it to the Funds Administrator and the Agent,
and such extensions or renewals thereof as may reasonably be requested by the
Funds Administrator and the Agent, certifying (A) in the case of a Form W-8BEN
or W-8EC1 that such Foreign Lender is entitled to receive payments under this
Credit Agreement, the Notes or any Letter of Credit payable to it without
deduction or withholding of
-34-
any United States federal income taxes or with such withholding imposed at a
Reduced Rate, unless in any such case any change in a tax treaty to which the
United States is a party, or any change in law or regulation of the United
States or official interpretation thereof has occurred after the Closing Date
and prior to the date on which any such delivery would otherwise be required
that renders all such forms inapplicable or that would prevent such Foreign
Lender from duly completing and delivering any such form with respect to it, and
such Foreign Lender advises the Funds Administrator and the Agent that it is not
capable of receiving payments without any deduction or withholding of United
States federal income tax or with such withholding at the Reduced Rate, as the
case may be, or (B) in the case of a Form W-8BEN or W-8EC1, establishing an
exemption from United States backup withholding tax.
(f) If a Tax Transferee that is organized under the laws of a jurisdiction
outside of the United States acquires an interest in this Credit Agreement, any
Note, any participation interest in any Letter of Credit or any of the other
Credit Documents or a Foreign Lender changes the office through which Loans or
any other obligations are made, accounted for or booked, or a Foreign Lender if
an Issuing Lender, changes the office at which any Letter of Credit is
maintained, the transferor, or the applicable Foreign Lender, in the case of a
change of office, shall cause such Tax Transferee to agree that, on or prior to
the effective date of such acquisition or change, as the case may be, it will
deliver to the Funds Administrator and the Agent (i) two valid, duly completed
copies of IRS Form W-8BEN or W-8EC1 or successor applicable form, as the case
may be, and any other required form, certifying in each case that such Tax
Transferee is entitled to receive payments under this Credit Agreement, the
Notes, each Letter of Credit and each of the other Credit Documents payable to
it without deduction or withholding of United States federal income tax or with
such withholding imposed at a Reduced Rate and (ii) a valid, duly completed IRS
Form W-8 or W-9 or successor applicable form, as the case may be, to establish
an exemption from United States backup withholding tax. Each Tax Transferee that
delivers to the Funds Administrator and the Agent a Form W-8BEN or W-8EC1 and
any other required form, pursuant to the next preceding sentence, further
undertakes to deliver two further copies of the said forms, or successor
applicable forms, or other manner of required certification, as the case may be,
on or before the date that any such form expires or becomes obsolete or
otherwise is required to be resubmitted as a condition to obtaining an exemption
from a required withholding of United States federal income tax or entitlement
to having such withholding imposed at the Reduced Rate or after the occurrence
of any event requiring a change in the most recent form previously delivered by
it to the Funds Administrator and the Agent, and such extensions or renewals
thereof as may reasonably be requested by the Funds Administrator and the Agent,
certifying (A) in the case of a Form W-8BEN or W-8EC1 that such Tax Transferee
is entitled to receive payments under this Credit Agreement, the Notes and any
Letter of Credit without deduction or withholding of any United States federal
income taxes or with such withholding imposed at the Reduced Rate, unless any
change in treaty, law or regulation or official interpretation thereof has
occurred after the effective date of such acquisition or change and prior to the
date on which any such delivery would otherwise be required that renders all
such forms inapplicable or that would prevent such Tax Transferee from duly
completing and delivering any such form with respect to it, and such Tax
Transferee advises the Funds Administrator and the Agent that it is not capable
of receiving payments (1) without any deduction or withholding of United States
federal income tax or (2) with such withholding at the
-35-
Reduced Rate, as the case may be, or (B) in the case of a Form W-8BEN or W-8EC1,
establishing an exemption from United States backup withholding tax.
(g) If any Taxes for which any Borrower would be required to make payment
under this Section 2.8 are imposed, the applicable Lender or the Agent, as the
case may be, shall use its best efforts to avoid or reduce such Taxes by taking
any appropriate action (including assigning its rights hereunder to a related
entity or a different office) which would not in the sole opinion of such Lender
or the Agent be otherwise disadvantageous to such Lender or the Agent, as the
case may be.
(h) Without prejudice to the survival of any other agreement of the
Borrowers hereunder, the agreements and obligations of the Borrowers contained
in this Section 2.8 shall survive the payment in full of the Obligations.
(i) Each Lender shall cause each of its Serving Affiliates that is a
Foreign Lender to take the actions required to be taken by such Serving
Affiliate as a Foreign Lender under Section 2.8(e), (f) and (g).
2.9 Affected Lenders. If any Borrower is obligated to pay to any Lender
----------------
(whether in its capacity as a Lender or an Issuing Lender) or any Serving
Affiliate of such Lender any amount under Sections 2.8 or 4.9, or if any Lender
is a Defaulting Lender, the Borrowers may, if no Default or Event of Default
then exists, replace such Lender or Serving Affiliate with another lender
acceptable to the Agent, and such Lender hereby agrees to be so replaced or to
cause such Serving Affiliate to be replaced, subject to the following:
(a) (i) The obligations of the Borrowers hereunder to the Lender to be
replaced (in its capacity as a Lender, and including such increased or
additional costs incurred from the date of notice to the Funds Administrator of
such increase or additional costs through the date such Lender is replaced
hereunder) shall be paid in full to such Lender concurrently with such
replacement; and
(ii) the obligations of the Borrowers hereunder to the Lender to be
replaced in its capacity as an Issuing Lender, or to its Serving Affiliate in
such capacity, shall continue until (A) each Letter of Credit issued by that
Person has expired or been drawn in full, (B) all outstanding reimbursement
obligations with respect to Letters of Credit, together with interest thereon at
the LC Interest Rate, shall have been paid in full, and (C) all Liabilities in
respect of Letters of Credit, to the extent due, have been paid in full and, to
the extent not due, been secured to the satisfaction of such Person.
(b) If such replacement is a result of increased costs under Sections 2.8
or 4.9, the replacement Lender shall be a bank or other financial institution
that is not subject to such increased costs which caused the Borrowers' election
to replace any Lender hereunder, and each such replacement Lender shall execute
and deliver to the Agent such documentation satisfactory to the Agent pursuant
to which such replacement Lender is to become a party hereto, conforming to the
provisions of Section 11.6, with a Commitment equal to that of the Lender being
replaced and shall make Loans in the aggregate principal amount equal to the
aggregate outstanding principal amount of the Loans of the Lender being
replaced;
-36-
(c) Upon such execution of such documents referred to in clause (b) and
repayment of the amounts referred to in clause (a), the replacement lender shall
be a "Lender" with a Commitment as specified herein above and the Lender being
replaced shall cease to be a "Lender" hereunder, except with respect to
indemnification provisions under this Credit Agreement, which shall survive as
to such replaced Lender and except to the extent such Lender continues to be an
Issuing Lender pursuant to Section 2.9(a)(ii);
(d) The Agent shall reasonably cooperate in effectuating the replacement
of any Lender under this Section 2.9, but at no time shall the Agent be
obligated to initiate any such replacement;
(e) Any Lender replaced under this Section 2.9 shall be replaced at the
Borrowers' sole cost and expense and at no cost or expense to the Agent or any
of the Lenders; and
(f) If the Borrowers propose to replace any Lender pursuant to this
Section 2.9 because the Lender seeks reimbursement under either Section 2.8 or
4.9, then it must also replace any other Lender who seeks similar levels of
reimbursement (as a percentage of such Lender's Commitment) under such Sections.
2.10 Sharing of Payments. (a) (i) If any Lender (including a Lender in its
-------------------
capacity as an Issuing Lender) shall obtain any payment (whether voluntary,
involuntary, and whether the exercise of any right of set-off by virtue of its
claim in any applicable bankruptcy, insolvency or other similar proceeding being
deemed secured by a Liability owed by it to any Credit Party, including a claim
deemed secured under Section 506 of the Bankruptcy Code, or otherwise) (each a
"Payment"), on account of (A) the Loans made by it, (B) its participation
interests in Letters of Credit; or (C) any of the other Obligations due and
payable to it in excess of its Proportionate Share of payments on account of the
Loans or participation interests in Letters of Credit or such other Obligations
obtained by all the Lenders, such Lender shall forthwith purchase from the other
Lenders such participations in the Loans made by them, in their participation in
Letters of Credit or their other such Obligations as shall be then due and
payable as shall be necessary to cause such purchasing Lender to share the
excess payment ratably with each of them; however, provided that if all or any
portion of such excess payment is thereafter recovered from such purchasing
Lender, such purchase from each Lender shall be rescinded and each such Lender
shall repay to the purchasing Lender the purchase price to the extent of such
recovery together with an amount equal to such Lender's ratable share (according
to the proportion of (1) the amount of such Lender's required repayment to (2)
the total amount so recovered from the purchasing Lender) of any interest or
other amount paid or payable by the purchasing Lender in respect to the total
amount so recovered. Each Borrower agrees that any Lender so purchasing a
participation from another Lender pursuant to this Section 2.10 may, to the
fullest extent permitted by law, exercise all of its rights of payment
(including the right of set-off) with respect to such participation as fully as
if such Lender were the direct creditor of such Borrower in the amount of such
participation.
(ii) For purposes of this Section 2.10, all Unpaid Drawings due and
payable to any Issuing Lender shall be deemed to constitute "Loans" made by such
Issuing Lender, and such Issuing Lender agrees that it shall apply all Payments
received by it in its capacity as an Issuing Lender to the payment or the
collateralization of the Liabilities of the Borrowers to it that
-37-
constitute Unpaid Drawings payable to such Issuing Lender before applying
them to any other Liabilities due it.
(b) If an Issuing Lender is an Affiliate of a Lender, such Lender shall
cause such Affiliate to comply with the provisions of subsection (a)(i) of
Section 2.10 as fully as though such Affiliate were a Lender subject to such
subsection.
2.11 Allocation of Loans and Expenses.
--------------------------------
(a) The Borrowers maintain an integrated cash management system reflecting
their interdependence on one another and the mutual benefits shared among them
as a result of their respective operations. In order to efficiently fund and
operate their respective businesses and minimize the number of Borrowings which
they will make under this Credit Agreement and thereby reduce the administrative
costs and record keeping required in connection therewith, including the
necessity to enter into and maintain separately identified and monitored
borrowing facilities, the Borrowers have requested, and the Agent and the
Lenders have agreed that, subject to Section 11.21, (i) all Loans will be
advanced to and for the account of the Borrowers on a joint and several basis to
the Disbursement Account and (ii) all Letters of Credit will be issued pursuant
to an LC Application executed by the Funds Administrator on behalf and for the
account of the Borrower or Borrowers specified by the Funds Administrator in
such application. Each Borrower hereby acknowledges that it will be receiving a
direct benefit from each Loan made and each Letter of Credit issued pursuant to
this Credit Agreement.
(b) In order to track more precisely the respective recipients of the
proceeds of each Loan and the Borrower or Borrowers receiving the primary
benefit from the issuance of each Letter of Credit, and to assist the Funds
Administrator, the Borrowers, the Agent and the Lenders in administering the
Loans and the Letters of Credit, each Borrower has agreed with the Agent and the
Lenders to cause the Funds Administrator to establish and maintain, and the
Funds Administrator hereby agrees to establish and maintain, accounts with
respect to each Borrower (each Borrower's "Allocation Account") in which the
Funds Administrator shall record its good faith allocation to each of the
Borrowers of (w) the proceeds, if any, of each Loan received by or for the
account of such Borrower, (x) payments made to the Agent on account of the
Obligations of such Borrower, (y) the aggregate face amount of all outstanding
Letters of Credit issued for the benefit of such Borrower, and (z) all
previously unallocated Expenses.
(c) At the request of the Agent, as soon as available, but not later than
fifteen (15) Business Days after the last Business Day of each month ending
after the Closing Date, the Funds Administrator shall deliver to the Agent and
each Borrower a report prepared by or under the supervision of a Responsible
Officer of the Funds Administrator, and certified by such Responsible Officer,
setting forth with respect to each Borrower the balance of the Allocation
Account of such Borrower as of the end of, and all activity occurring in such
Allocation Account during, such month. Absent manifest error, each such monthly
statement shall be final, conclusive and binding on the respective Borrowers.
-38-
ARTICLE 3
LETTERS OF CREDIT
-----------------
3.1 Letters of Credit.
-----------------
(a) Subject to and upon the terms and conditions set forth herein, the
Funds Administrator may, at any time and from time to time on and after the
Closing Date and prior to the 30th day prior to the Expiration Date, request
Agent either to (i) direct an Issuing Lender to issue for the joint and several
account of the Borrowers and for the benefit of (A) any holder (or any trustee,
agent or other similar representative for any such holders) of LC Supportable
Obligations, an irrevocable standby letter of credit, in a form customarily used
by the Issuing Lender or in such other form as has been approved by the Issuing
Lender, and (B) sellers of goods to a Borrower, an irrevocable trade letter of
credit, or (ii) approve the issuance by an Issuing Lender of an irrevocable
trade letter of credit upon application made by the Funds Administrator directly
to such Issuing Lender pursuant to an application procedure approved by Agent in
advance, in each case in a form customarily used by the Issuing Lender or in
such other form as has been approved by the Issuing Lender, (each such letter of
credit, a "Letter of Credit" and, collectively, the "Letters of Credit"). All
Letters of Credit shall be denominated in Dollars and shall be issued on a sight
basis only.
(b) Subject to and upon the terms and conditions set forth herein, the
Agent agrees that it will, at any time and from time to time on and after the
Closing Date and prior to the 30th day prior to the Expiration Date, following
its receipt of the respective Letter of Credit Request, direct the applicable
Issuing Lender to issue, or approve the issuance of, in each case for the joint
and several account of the Borrowers, one or more Letters of Credit as are
permitted to remain outstanding hereunder without giving rise to a Default or an
Event of Default, provided that the Agent shall not be under any obligation to
direct an Issuing Lender to issue any Letter of Credit if at the time of such
issuance any order, judgment or decree of any governmental authority or
arbitrator shall purport by its terms to enjoin or restrain such Issuing Lender
from issuing such Letter of Credit or any requirement of law applicable to such
Issuing Lender or any request or directive (whether or not having the force of
law) from any Governmental Authority with jurisdiction over such Issuing Lender
shall prohibit, or request that such Issuing Lender refrain from, the issuance
of letters of credit generally or such Letter of Credit in particular or shall
impose upon such Issuing Lender with respect to such Letter of Credit any
restriction or reserve or capital requirement (for which such Issuing Lender is
not otherwise compensated hereunder) not in effect with respect to such Issuing
Lender on the date hereof, or any unreimbursed loss, cost or expense which was
not applicable or in effect with respect to such Issuing Lender as of the date
hereof and which such Issuing Lender reasonably and in good xxxxx xxxxx material
to it. The transmittal by the Funds Administrator of any Letter of Credit
Request shall be deemed to be a representation and warranty made by the
Borrowers, both at the time of such transmittal and at the time of the issuance
of the requested Letter of Credit, that the Letter of Credit may be issued in
accordance with and will not violate any of the requirements of this Article 3.
3.2 Maximum Letter of Credit Outstandings; Final Maturities.
-------------------------------------------------------
Notwithstanding anything to the contrary contained in this Credit Agreement, (a)
no Letter of Credit shall be issued if (x) the Stated Amount thereof, when added
to the Letter of Credit Outstandings
-39-
(exclusive of Unpaid Drawings which are repaid on the date of, and prior to the
issuance of, the respective Letter of Credit) at such. time would exceed
$10,000,000, or (y) after giving effect to such issuance, the Total Exposure
would exceed the lesser of (I) the Total Commitments and (II) the Borrowing
Base; and (b) each Letter of Credit shall by its terms terminate on or before
(x) in the case of standby Letters of Credit, the date which occurs 12 months
after the date of the issuance thereof (although any such standby Letter of
Credit may be extendible for successive periods of up to 12 months on terms
acceptable to the Agent and the applicable Issuing Lender), but in no event
later than ten (10) Business Days prior to Expiration Date, and (y) in the case
of trade Letters of Credit, on or before the date which occurs 180 days after
the date of issuance thereof, but in no event later than the thirtieth (30th)
day prior to the Expiration Date.
3.3 Letter of Credit Requests; Minimum Stated Amount.
------------------------------------------------
(a) Whenever the Funds Administrator desires the Agent to direct or
approve the issuance of a Letter of Credit for the account of the Borrowers (or
to amend or modify any existing Letter of Credit), the Funds Administrator shall
give the Agent at least five Business Days' (or such shorter period as is
acceptable to the Agent) written notice thereof (including by way of facsimile
transmission). Each such notice shall be given to Agent in the form attached
hereto as Exhibit D (each a "Letter of Credit Request").
(b) The making of each Letter of Credit Request shall be deemed to be a
representation and warranty by the Funds Administrator and each of the Borrowers
to the Agent and the Lenders that such Letter of Credit may be issued in
accordance with, and will not violate the requirements of, Section 3.2. Upon
receipt by the Agent of a Letter of Credit Request, then the Agent shall,
subject to the terms and conditions of this Credit Agreement, either direct the
applicable Issuing Lender to issue (or amend or modify, as the case may be), or
approve the issuance of, the requested Letter of Credit for the account of the
Borrowers in accordance with such Issuing Lender's usual and customary
practices. Upon the issuance or modification of, or amendment to, any standby
Letter of Credit, the applicable Issuing Lender shall promptly provide written
confirmation of such issuance, amendment or modification, as the case may be, to
the Funds Administrator and the Agent, and such notice shall be accompanied by a
copy of such issuance, modification or amendment, as the case may be. Upon
receipt of such notice, the Agent shall promptly provide written notice to the
Participants of such issuance, modification or amendment, and if requested, the
Agent shall provide each such Participant with copies of any such issuance,
modification or amendment. With regard to trade Letters of Credit, the
applicable Issuing Lender shall, on the first Business Day of each week, provide
the Agent with a report, by facsimile transmission, of the daily aggregate
outstanding trade Letters of Credit during the previous week. Upon receipt of
such report, the Agent shall provide the Participants with the contents of such
report. Notwithstanding anything to the contrary contained in this Credit
Agreement, in the event that any Lender is a Defaulting Lender, no Issuing
Lender shall be required to issue any Letter of Credit unless such Issuing
Lender has entered into arrangements satisfactory to it and the Borrowers to
eliminate such Issuing Lender's risk with respect to the participation in
Letters of Credit by such Defaulting Lender, including by cash collateralizing
such Defaulting Lender's Proportionate Share of the Letter of Credit
Outstandings.
-40-
3.4 Letter of Credit Participations.
-------------------------------
(a) Immediately upon the issuance by an Issuing Lender of any Letter of
Credit, such Issuing Lender shall be deemed to have sold and transferred to each
Lender (other than such Issuing Lender in its capacity (if any) as a Lender) and
each such Lender (in its capacity under this Section 3.4, a "Participant"),
shall be deemed irrevocably and unconditionally to have purchased and received
from such Issuing Lender, without recourse or warranty, an undivided interest
and participation, to the extent of such Participant's Proportionate Share, in
such Letter of Credit, each drawing or payment made thereunder and the joint and
several obligations of the Borrowers under this Credit Agreement with respect
thereto, and any security therefor or guaranty pertaining thereto. Upon any
change in the Commitments or Proportionate Shares of the respective Lenders
pursuant to Section 2.9 or Section 11.6, it is hereby agreed that, with respect
to all outstanding Letters of Credit and Unpaid Drawings relating thereto, there
shall be an automatic adjustment to the participations pursuant to this Section
3.4 to reflect the new Proportionate Shares of the assignor and assignee Lender,
as the case may be.
(b) In determining whether to pay under any Letter of Credit, no Issuing
Lender shall have any obligation relative to the other Lenders other than to
confirm that any documents required to be delivered under such Letter of Credit
appear to have been delivered and that they appear to substantially comply on
their face with the requirements of such Letter of Credit. Any action taken or
omitted to be taken by any Issuing Lender under or in connection with any Letter
of Credit issued by it shall not create for such Issuing Lender any resulting
liability to any of the Borrowers, any other Credit Party, any Lender or any
other Person unless such action is taken or omitted to be taken with gross
negligence or willful misconduct (as determined by a court of competent
jurisdiction in a final and non-appealable decision).
(c) In the event that any Issuing Lender makes any payment under any
Letter of Credit issued by it and the Borrowers shall not have reimbursed such
amount in full to such Issuing Lender pursuant to Section 3.5(a), such Issuing
Lender shall promptly notify the Agent, which shall promptly notify each
Participant of such failure, and each Participant shall promptly and
unconditionally pay to such Issuing Lender the amount of such Participant's
Proportionate Share of such unreimbursed payment in Dollars and in same day
funds. If the Agent so notifies, prior to 12:00 Noon on any Business Day, any
Participant required to fund a payment under a Letter of Credit, such
Participant shall make available to the applicable Issuing Lender in Dollars
such Participant's Proportionate Share of the amount of such payment on such
Business Day in same day funds. If and to the extent such Participant shall not
have so made its Proportionate Share of the amount of such payment available to
the applicable Issuing Lender, such Participant agrees to pay to such Issuing
Lender, forthwith on demand such amount, together with interest thereon, for
each day from such date until the date such amount is paid to such Issuing
Lender at the overnight Federal Funds Rate for the first three days and at the
interest rate applicable to Loans that are maintained as Prime Rate Loans for
each day thereafter. The failure of any Participant to make available to any
Issuing Lender its Proportionate Share of any payment under any Letter of Credit
shall not relieve any other Participant of its obligation hereunder to make
available to such Issuing Lender its Proportionate Share of any payment under
such Letter of Credit on the date required, as specified above, but no
Participant shall be responsible for the failure of any other Participant to
make available to such Issuing Lender such other Participant's Proportionate
Share of any such payment.
-41-
(d) Whenever any Issuing Lender receives a payment of a reimbursement
obligation as to which it has received any payments from the Participants
pursuant to clause (c) above, such Issuing Lender shall pay to each such
Participant which has paid its Proportionate Share thereof, in Dollars and in
same day funds, an amount equal to such Participant's share (based upon the
proportionate aggregate amount originally handed by such Participant to the
aggregate amount funded by all Participants) of the principal amount of such
reimbursement obligation and interest thereon accruing after the purchase of the
respective participations.
(e) Upon the request of any Participant, each Issuing Lender shall furnish
to such Participant copies of any Letter of Credit issued by it and such other
documentation with respect thereto as may reasonably be requested by such
Participant.
(f) The obligations of the Participants to make payments to an Issuing
Lender with respect to Letters of Credit issued by it shall be irrevocable and
not subject to any qualification or exception whatsoever and shall be made in
accordance with the terms and conditions of this Credit Agreement under all
circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of this Credit Agreement
or any of the other Credit Documents;
(ii) the existence of any claim, setoff, defense or other right
which any Credit Party or any Subsidiary of any Credit Party may have at any
time against a beneficiary named in a Letter of Credit, any transferee of any
Letter of Credit (or any Person for whom any such transferee may be acting), the
Agent, any Participant, or any other Person, whether in connection with this
Credit Agreement, any Letter of Credit, the transactions contemplated herein or
any unrelated transactions (including any underlying transaction between any
Credit Party or any Subsidiary of any Credit Party and the beneficiary named in
any such Letter of Credit);
(iii) any draft, certificate or any other document presented under
any Letter of Credit proving to be forged, fraudulent, invalid or insufficient
in any respect or any statement therein being untrue or inaccurate in any
respect;
(iv) the surrender or impairment of any security for the performance
or observance of any of the terms of any of the Credit Documents; or
(v) the occurrence of any Default or Event of Default.
3.5 Agreement to Repay Letter of Credit Drawings.
--------------------------------------------
(a) The Borrowers jointly and severally agree to reimburse each Issuing
Lender, by making payment to the Agent in immediately available funds at the
Payment Office, for any payment or disbursement made by such Issuing Lender
under any Letter of Credit issued by it (each such amount so paid, until
reimbursed, an "Unpaid Drawing"), not later than one Business Day following
receipt by the Funds Administrator of notice of such payment or disbursement
(provided that no such notice shall be required to be given if an Event of
Default under Section 9.1(e) shall have occurred and be continuing, in which
case the Unpaid Drawing shall be due and payable immediately without
presentment, demand, protest or notice of any kind
-42-
(all of which are hereby waived by the Funds Administrator and each of the
Borrowers)), with interest on the amount so paid or disbursed by such Issuing
Lender, to the extent not reimbursed prior to 12:00 Noon on the date of such
payment or disbursement, from and including the date paid or disbursed to but
excluding the date such Issuing Lender was reimbursed by the Borrowers therefor
at a rate per annum equal to the Prime Lending Rate in effect from time to time
plus one percent (1.00%); provided, that, to the extent such amounts are not
----
reimbursed prior to 12:00 Noon on the third Business Day following the receipt
by the Funds Administrator of notice of such payment or disbursement or
following the occurrence and during the continuance of a Default or an Event of
Default, interest shall thereafter accrue on the amounts so paid or disbursed by
the applicable Issuing Lender (and until reimbursed by the Borrowers) at a rate
per annum equal to the Prime Lending Rate in effect from time to time plus three
----
percent (3.0%), with such interest to be payable on demand. Each Issuing Lender
shall give the Funds Administrator prompt written notice of each Drawing under
any Letter of Credit issued by it, provided that the failure to give any such
notice shall in no way affect, impair or diminish the obligations of the
Borrowers hereunder.
(b) The obligations of the Borrowers under this Section 3.5 to reimburse
each Issuing Lender with respect to Drawings under Letters of Credit issued by
it (each a "Drawing") (including, in each case, interest thereon) shall be
absolute and unconditional under any and all circumstances and irrespective of
any setoff, counterclaim or defense to payment which any Borrower, any
Subsidiary of any Borrower or any other Credit Party may have or have had
against any Lender (including in its capacity as an Issuing Lender or as a
Participant), including, without limitation, any defense based upon the failure
of any Drawing under a Letter of Credit to conform to the terms of the Letter of
Credit or any nonapplication or misapplication by the beneficiary of the
proceeds of such Drawing; provided that the Borrowers shall not be obligated to
reimburse any Issuing Lender for any wrongful payment made by such Issuing
Lender under a Letter of Credit issued by it as a result of acts or omissions
constituting willful misconduct or gross negligence on the part of such Issuing
Lender (as determined by a court of competent jurisdiction in a final and non-
appealable decision).
3.6 Increased Costs. If at any time after the Closing Date, the
---------------
introduction of or any change in any applicable law, rule, regulation, order,
guideline or request or in the interpretation or administration thereof by the
NAIC or any Governmental Authority charged with the interpretation or
administration thereof, or compliance by any Issuing Lender or any Participant
with any request or directive by the NAIC or by any such Governmental Authority
(whether or not having the force of law), shall either (i) impose, modify or
make applicable any reserve, deposit, capital adequacy or similar requirement
against letters of credit issued by such Issuing Lender or participated in by
such Participant, or (ii) impose on such Issuing Lender or such Participant any
other conditions relating, directly or indirectly, to this Credit Agreement or
any Letter of Credit; and the result of any of the foregoing is to increase the
cost to such Issuing Lender or such Participant of issuing, maintaining or
participating in any Letter of Credit, or reduce the amount of any sum received
or receivable by such Issuing Lender or such Participant hereunder or reduce the
rate of return on such Person's capital with respect to Letters of Credit
(except for changes in the rate of tax on, or determined by reference to, the
net income or profits of such Issuing Lender or such Participant pursuant to the
laws of the jurisdiction in which it is organized or in which its principal
office or applicable lending office is located or any subdivision thereof or
therein), then, upon the delivery of the certificate referred to below to the
-43-
Funds Administrator by such issuing Lender or such Participant within ninety
days after an officer of such Issuing Lender or such Participant, as the case
may be, responsible for overseeing the transactions contemplated by this Credit
Agreement knows or had reason to know that such amount is payable by the
Borrowers pursuant to this Section 3.6 (a copy of which certificate shall be
sent by such Issuing Lender or such Participant to the Agent), the Borrowers
jointly and severally agree to pay to such Issuing Lender or such Participant,
as the case may be, such additional amount or amounts as will compensate such
Issuing Lender or Participant for such increased cost or reduction in the amount
receivable or reduction on the rate of return on its capital. Any Issuing
Lender or Participant, upon determining that any additional amounts will be
payable to such Person pursuant to this Section 3.6, will give prompt written
notice thereof to the Funds Administrator, which notice shall include a
certificate submitted to the Funds Administrator by such Issuing Lender or
Participant (a copy of which certificate shall be sent by such Issuing Lender or
such Participant, as the case may be, to the Agent), setting forth in reasonable
detail the basis for the calculation of such additional amount or amounts
necessary to compensate such Person. The certificate required to be delivered
pursuant to this Section 3.6 shall, absent manifest error, be final and
conclusive and binding on the Funds Administrator and each of the Borrowers.
ARTICLE 4
INTEREST, FEES AND EXPENSES
---------------------------
4.1 Interest on LIBOR Rate Loans. Subject to the provisions of Section
----------------------------
4.4, each LIBOR Rate Loan shall bear interest on its unpaid principal amount at
a rate per annum equal to the applicable Adjusted LIBOR Rate plus the Applicable
----
Margin, as the same may be adjusted pursuant to the provisions of the definition
of Applicable Margin. Such interest shall be payable on the last day of each
Interest Period with respect to such LIBOR Rate Loan (or, in the case of
Interest Periods in excess of three months on each of the ninetieth (90th) day
and the last day of such Interest Period), at the date of Conversion of such
LIBOR Rate Loan (or a portion thereof) to a Prime Rate Loan and at maturity of
such LIBOR Rate Loan, and after maturity of such LIBOR Rate Loan (whether by
acceleration or otherwise), upon demand. The Agent upon determining the
Adjusted LIBOR Rate for any Interest Period shall promptly notify the Funds
Administrator and the Lenders by telephone (confirmed promptly in writing) or in
writing thereof. Each determination by the Agent of an interest rate hereunder
shall be conclusive and binding for all purposes, absent manifest error.
4.2 Interest on Prime Rate Loans. Subject to the provisions of Section
----------------------------
4.4, each Prime Rate Loan shall bear interest on its unpaid principal amount at
a rate per annum equal to the Prime Lending Rate plus the Applicable Margin, as
----
the same may be adjusted pursuant to the provisions of the definition of
Applicable Margin. Such interest shall be payable monthly in arrears on the
first day of each calendar month. and at maturity of such Prime Rate Loan, and
after maturity of such Prime Rate Loan (whether by acceleration or otherwise),
upon demand. In the event of any change in said Prime Lending Rate, the rate
hereunder shall change, effective as of the day the Prime Lending Rate changes.
Each determination by the Agent of any interest rate hereunder shall be
conclusive and binding for all purposes, absent manifest error.
-44-
4.3 Notice of Continuation and Notice of Conversion.
-----------------------------------------------
(a) With respect to any Borrowing consisting of LIBOR Rate Loans, the
Borrowers may (so long as no Default or Event of Default has occurred and is
continuing, subject to the provisions of Section 4.3(c)), elect to maintain such
Borrowing or any portion thereof as consisting of LIBOR Rate Loans by selecting
a new Interest Period for such Borrowing, which new Interest Period shall
commence on the last day of the immediately preceding Interest Period. Each
selection of a new Interest Period (a "Continuation") shall be made by notice
given not later than 12:00 noon on the third Business Day prior to the date of
any such Continuation relating to LIBOR Rate Loans, by the Funds Administrator
to the Agent. Such notice by the Funds Administrator of a Continuation (a
"Notice of Continuation") shall be in substantially the form of Exhibit C-1,
specifying (i) the date of such Continuation, (ii) the type of Loans subject to
such Continuation, (iii) the aggregate amount of Loans subject to such
Continuation and (iv) the duration of the selected Interest Period, all of which
shall be specified in such manner as is necessary to comply with all limitations
on Loans outstanding hereunder. The Borrowers may elect to maintain more than
one Borrowing consisting of LIBOR Rate Loans by combining such Borrowings into
one Borrowing and selecting a new Interest Period pursuant to this Section
4.3(a); provided that each of the Borrowings so combined shall consist of Loans
having Interest Periods ending on the same date. If the Borrowers shall fail to
select a new Interest Period for any Borrowing consisting of LIBOR Rate Loans in
accordance with this Section 4.3(a), such Loans will automatically, on the last
day of the then existing Interest Period therefor, Convert into Prime Rate
Loans.
(b) The Borrowers may on any Business Day (so long as no Default or Event
of Default has occurred and is continuing), upon notice (each such notice, a
"Notice of Conversion") given by the Funds Administrator to the Agent, and
subject to the provisions of Section 4.3(c), Convert the entire amount of or a
portion of all Loans of one type comprising the same Borrowing into Loans of
another Type; however, provided that any Conversion of any LIBOR Rate Loans into
Loans of another Type shall be made on, and only on, the last day of an Interest
Period for such LIBOR Rate Loans and, upon Conversion of any Loans into Loans of
another Type, the Borrowers shall pay accrued interest to the date of Conversion
on the principal amount Converted. Each such Notice of Conversion shall be given
not later than 12:00 noon on the Business Day prior to the date of any proposed
Conversion into Prime Rate Loans and on the third Business Day prior to the date
of any proposed Conversion into LIBOR Rate Loans. Subject to the restrictions
specified above, each Notice of Conversion shall be in substantially the form of
Exhibit C-2 hereto specifying (i) the requested date of such Conversion, (ii)
the Type of Loans to be Converted, (iii) the portion of such Type of Loan to be
Converted, (iv) the Type of Loan such Loans are to be Converted into and (v) if
such Conversion is into LIBOR Rate Loans, the duration of the Interest Period of
such Loan. Each Conversion shall be in an aggregate amount for the Loans of all
Lenders of not less than $5,000,000 or any integral multiple of $1,000,000 in
excess thereof. The Borrowers may elect to Convert the entire amount of or a
portion of all Loans of one Type comprising more than one Borrowing into Loans
of another Type by combining such Borrowings into one Borrowing consisting of
Loans of another Type; provided that if the Borrowings so combined consist of
LIBOR Rate Loans, such Loans shall have Interest Periods ending on the same
date.
-45-
(C) Notwithstanding anything contained in subsections (a) and (b) above or
elsewhere in this Credit Agreement to the contrary,
(I) (A) if the Agent is unable to determine the LIBOR Rate for LIBOR
Rate Loans comprising any requested Borrowing, Continuation or
Conversion, the right of the Borrowers to select or maintain LIBOR
Rate Loans for such Borrowing or any subsequent Borrowing shall be
suspended until the Agent shall notify the Funds Administrator and the
Lenders that the circumstances causing such suspension no longer
exist, and each Loan comprising such Borrowing shall be a loan of a
Type that is unaffected by such circumstances, as selected by the
Borrowers pursuant to this Credit Agreement;
(B) if a Lender shall, at any time, notify the Agent that,
because of a change in applicable law after the date such Lender
became a Lender, it has become unlawful for such Lender to participate
in any requested Borrowing, Continuation or Conversion of LIBOR Rate
Loans, to continue its LIBOR Rate Loans, or to comply with its
obligations hereunder in respect thereof, that Lender's obligation to
participate in any such requested Borrowing, Continuation or
Conversion shall be discharged by such Lender's making its
participation therein in the form of a Prime Rate Loan, and any of
such Lender's LIBOR Rate Loans not otherwise being converted shall be
converted into Prime Rate Loans on the earlier of (1) the last day of
the applicable Interest Period and (2) the last day such Lender may
lawfully continue to maintain LIBOR Rate Loans, provided that any
Prime Rate Loan that, but for this clause (B), would have been a LIBOR
Rate Loan shall constitute part of the Borrowing of which any such
LIBOR Rate Loan was or would have been a part;
(ii) if the Majority Lenders shall, at least one Business Day before
the date of any requested Borrowing, Continuation or Conversion, notify the
Agent that the LIBOR Rate for Loans comprising such Borrowing will not
adequately reflect the cost to such Lenders of making or funding their
respective Loans for such Borrowing, the right of the Borrowers to select LIBOR
Rate Loans for such Borrowing shall be suspended until the Agent shall notify
the Funds Administrator and the Lenders that the circumstances causing such
suspension no longer exist, and each Loan comprising such Borrowing shall be a
Loan of a Type that is unaffected by such circumstances, as selected by the
Borrowers pursuant to this Credit Agreement;
(iii) the Borrowers may not choose LIBOR Rate Loans for any Borrowing,
Continuation or Conversion before the Syndication Date following the Closing
Date; and
(iv) the Borrowers shall borrow, prepay, convert and continue Loans
in a manner such that (A) the aggregate principal amount of LIBOR Rate Loans
having the same Interest Period shall at all times be not less than $5,000,000,
(B) there shall not be, at any one time, more than five Interest Periods in
effect with respect to LIBOR Rate Loans and (C) no payment of LIBOR Rate Loans
will have to be made prior to the last day of an applicable Interest Period in
order to repay the Loans in the amounts and on the date specified in Section
2.4(b).
-46-
(d) Each Notice of Continuation and Notice of Conversion shall be
irrevocable by and binding on the Borrowers.
4.4 Interest After Event of Default. Interest on any amount of overdue
-------------------------------
interest on or overdue principal of the Loans, and interest on the amount of
principal under the Loans outstanding as of the date an Event of Default occurs,
and at all times thereafter until the earlier of the date upon which (a) all
Obligations have been paid and satisfied in full or (b) such Event of Default
shall not be continuing, shall be payable on demand at a rate per annum equal to
the rate at which the Loans are bearing interest pursuant to Sections 4.1 and
4.2 above, plus two percent (2.0%). In the event of any change in said
----
applicable interest rate, the rate hereunder shall change, effective as of the
day the applicable interest rate changes, so as to remain two percent (2.0%) per
annum above the then applicable interest rate.
4.5 Unused Line Fee. The Borrowers shall pay to the Agent, for the
---------------
ratable benefit of the Lenders, a non-refundable fee (the "Unused Line Fee")
equal to one-half of one percent (0.50%) per annum of the unused portion of the
Line of Credit (with any outstanding Letters of Credit constituting usage of the
Line of Credit). The Unused Line Fee shall accrue daily from the Closing Date
until the Expiration Date, and shall be due and payable monthly in arrears, on
the first Business Day of calendar month and on the Expiration Date.
4.6 Letter of Credit Fees. (a) The Agent shall be entitled to charge for
the account of the Funds Administrator on the first Business Day of each
calendar quarter, a fee payable by the Borrowers for the ratable benefit of the
Lenders, in an amount equal to the Applicable Margin with respect to LIBOR Rate
Loans in effect from time to time of the Stated Amount of all Letters of Credit
outstanding during the immediately preceding calendar quarter (the "Letter of
Credit Fee").
(b) The Agent shall also be entitled to charge to the account of the Funds
Administrator as and when incurred by the Agent or any Lender, the customary
charges, fees, costs and expenses charged to the Agent or any Lender for the
Funds Administrator's account by any Issuing Lender (the "Issuing Lender Fees")
in connection with the issuance, transfer, drawing, amendment or negotiation of
any Letters of Credit by the Issuing Lender thereof. Each determination by the
Agent of Letter of Credit Fees and Issuing Lender Fees shall be conclusive and
binding for all purposes, absent manifest error.
(c) Agent shall also be entitled to charge for the account of the Funds
Administrator the applicable fee with respect to each Letter of Credit set forth
in the Fee Letter.
(d) Upon notice from Agent, after the occurrence of an Event of Default
until the earlier of the date upon which (i) all Obligations shall have been
paid and satisfied in full or (ii) such Event of Default shall not be
continuing, the Letter of Credit Fee payable with respect to Letters of Credit
shall be payable on demand at a rate per annum equal to the Letter of Credit Fee
then in effect pursuant to clause (a) above plus two percent (2.0%). In the
----
event of any change in such Letter of Credit Fee, the Letter of Credit Fee
hereunder shall change, effective as of the date of such change so as to remain
two percent (2.0%) per annum above the then applicable Letter of Credit Fee.
-47-
4.7 Reimbursement of Expenses.
-------------------------
(a) From and after the Closing Date, the Borrowers shall promptly
reimburse the Agent for all Expenses of the Agent as the same are incurred by
the Agent and upon receipt of invoices therefor and, if requested by the Funds
Administrator, such reasonable backup materials and information as any Borrower
shall reasonably request.
(b) The Borrowers shall pay to each Lender, upon request, such amount or
amounts as such Lender determines in good faith are necessary to compensate it
for any loss, cost or expense incurred by it as a result of (i) any payment,
prepayment or conversion of a LIBOR Rate Loan on a date other than the last day
of an Interest Period for such LIBOR Rate Loan or (ii) a LIBOR Rate Loan for any
reason not being made or converted, or any payment of principal thereof or
interest thereon not being made, on the date therefor determined in accordance
with the applicable provisions of this Credit Agreement. At the election of such
Lender, and without limiting the generality of the foregoing, but without
duplication, such compensation on account of losses may include an amount equal
to the excess of (A) the interest that would have been received from the
Borrowers under and in accordance with the terms of this Credit Agreement on any
amounts to be reemployed during an Interest Period or its remaining portion over
(B) the interest component of the return that such Lender determines it could
have obtained had it placed such amount on deposit in the interbank Dollar
market selected by it for a period equal to such Interest Period or its
remaining portion.
4.8 Authorization to Charge Borrowers' Account. Each Borrower hereby
------------------------------------------
authorizes the Agent to charge the Borrowers' Account with the amount of all
Fees, Expenses and other payments to be paid hereunder, under the Fee Letter and
under the other Credit Documents as and when such payments become due. Each
Borrower confirms that any charges which the Agent may so make to the Borrowers'
Account as herein provided will be made as an accommodation to the Borrowers and
solely at the Agent's discretion.
4.9 Indemnification in Certain Events. If after the Closing Date, either
---------------------------------
(a) any change in or in the interpretation of any law or regulation is
introduced, including with respect to reserve requirements, applicable to BTCo,
Deutsche Bank AG or any other banking or financial institution from whom any of
the Lenders borrows funds or obtains credit (a "Funding Bank"), the Agent or any
of the Lenders, or (b) the Agent, a Funding Bank or any of the Lenders complies
with any future guideline or request from any central bank or other Governmental
Authority or (c) the Agent, a Funding Bank or any of the Lenders determines that
the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change therein, or any change in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof has or would
have the effect described below, or the Agent, a Funding Bank or any of the
Lenders complies with any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, and in the case of any event set forth in this clause (c),
such adoption, change or compliance has or would have the direct or indirect
effect of reducing the rate of return on any of the Lenders' capital as a
consequence of its obligations hereunder or with respect to any participation
interest in any Letter of Credit to a level below that which such Lender could
have achieved but for such adoption, change or compliance (taking into
consideration the Agent's or such Funding Bank's
-48-
or Lender's policies as the case may be with respect to capital adequacy) by an
amount deemed by such Lender to be material, or any of the foregoing events
described in clauses (a), (b) or (c) increases the cost to the Agent, or any of
the Lenders of (i) funding or maintaining the Line of Credit; or (ii) acquiring
or maintaining any participation interest in any Letter of Credit, or reduces
the amount receivable in respect thereof, or in respect of such Letter of
Credit, by the Agent, the Issuing Lender of such Letter of Credit or any Lender,
then the Borrowers shall upon demand by the Agent, pay to the Agent, for the
account of each applicable Lender or, as applicable, an Issuing Lender or a
Funding Bank, additional amounts sufficient to indemnify such Person against
such increase in cost or reduction in amount receivable. A certificate as to the
amount of such increased cost and setting forth in reasonable detail the
calculation thereof shall, if requested by the Funds Administrator, be submitted
to the Funds Administrator by the Person making such claim, and shall be
conclusive absent manifest error.
4.10 Calculations and Determinations. (a) All calculations of (i)
-------------------------------
interest hereunder and (ii) Fees, shall be made by the Agent, on the basis of a
year of 360 days, or, if such computation would cause the interest and fees
chargeable hereunder to exceed the Highest Lawful Rate, 365/366 days, in each
case to the extent applicable for the actual number of days elapsed (including
the first day but excluding the last day) occurring in the period for which such
interest or fees are payable.
(b) In making the determinations contemplated by Article 4, the Agent and
each Lender may make such estimates, assumptions, allocations and the like that
such Person in good faith determines to be appropriate.
(c) Each determination by the Agent of an interest rate or payment
hereunder shall be conclusive and binding for all purposes, absent manifest
error.
ARTICLE 5
CONDITIONS PRECEDENT
--------------------
5.1 Conditions to Initial Credit Event. The initial Credit Event is
----------------------------------
subject to the satisfaction or waiver, immediately prior thereto or concurrently
therewith, of the following conditions precedent:
(a) Closing Document List. The Agent and the Lenders shall have received
---------------------
each of the agreements, opinions, reports, approvals, consents, certificates and
other documents set forth on the Closing Document List attached hereto as Annex
I.
(b) Fees and Expenses. The Agent and each of the Lenders shall have
-----------------
received payment in full of those Fees and Expenses referred to in the Fee
Letter and in Article 4 payable to them on or before the Initial Credit Event
(or an irrevocable authorization to pay such Fees or Expenses out of the
proceeds of the Loans).
(c) Changes in Market. There shall not have occurred and be continuing a
-----------------
material adverse change in the market for syndicated bank credit facilities, or
a material disruption of, or
-49-
material adverse change in, financial, banking or capital market conditions, in
each case since the date hereof, as reasonably determined by the Agent.
(d) Borrowing Base; Unused Availability. After giving pro forma effect to
-----------------------------------
the funding of the initial Loans, the issuance of the initial Letters of Credit,
if any, and the payment of all costs, fees and expenses incurred by or for the
account of the Borrowers in connection with the execution and delivery of this
Credit Agreement and the other Credit Documents, there shall be unused
availability under the Borrowing Base of at least $20,000,000.
(e) Additional Documents. The Funds Administrator and each Borrower shall
have executed and delivered to the Agent and the Lenders all documents which the
Agent or any Lender determines are reasonably necessary to consummate the
transactions contemplated hereby.
5.2 Conditions to Each Credit Event. On the date of each Credit Event
-------------------------------
(including the initial Credit Event), both immediately before and immediately
after giving effect thereto and to the application of the proceeds therefrom,
the following statements shall be true to the satisfaction of the Agent (and
each request for a Credit Event, shall constitute a representation and warranty
by each Borrower that on the date of such Credit Event, immediately before and
immediately after giving effect thereto and to the application of the proceeds
therefrom, such statements are true):
(a) The representations and warranties contained in this Credit
Agreement and in each other Credit Document are true and correct in all
material respects on and as of the date of such Credit Event as though made
on and as of such date, except to the extent that such representations and
warranties expressly relate solely to an earlier date (in which case such
representations and warranties shall have been true and correct in all
material respects on and as of such earlier date);
(b) No event has occurred and is continuing, or could reasonably be
expected to result from such Credit Event or the application of the
proceeds thereof, which would constitute a Default or an Event of Default;
and
(c) In the case of the issuance of any Letter of Credit, none of the
events set forth in Section 3.1 has occurred and is continuing or would
result from the issuance of such Letter of Credit.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES
------------------------------
To induce the Agent and the Lenders to enter into this Credit Agreement and
each Issuing Lender to issue Letters of Credit, each Borrower, with respect to
itself, each of the other Borrowers and each of their respective Subsidiaries,
hereby represents and warrants to the Agent, the Lenders and each Issuing
Lender:
6.1 Organization and Qualification. Each Borrower and each Subsidiary of
------------------------------
each Borrower (a) is a corporation duly organized, validly existing and in good
standing under the
-50-
laws of the state of its incorporation, (b) has the power and authority to own
its properties and assets and to transact the businesses in which it presently
is, or proposes to be, engaged and (c) is duly qualified and is authorized to do
business and is in good standing in each jurisdiction where it presently is, or
proposes to be, engaged in business, except for any failures to be so qualified,
authorized or in good standing which singly or in the aggregate could not
reasonably be expected to have a Material Adverse Effect. Schedule B, Part 6.1
lists all jurisdictions in which each Borrower and each Subsidiary of each
Borrower are qualified to do business as foreign corporations.
6.2 Solvency. The fair saleable value of the assets of each Borrower and
--------
each Subsidiary of each Borrower exceeds all its probable liabilities, including
those to be incurred pursuant to this Credit Agreement and the other Credit
Documents. Each Borrower and each Subsidiary of each Borrower (a) does not have
unreasonably small capital in relation to the business in which it is, or
proposes to be, engaged and (b) has not incurred, and does not believe that it
will incur after giving effect to the transactions contemplated by this Credit
Agreement and the other Credit Documents, debts beyond its ability to pay such
debts as they become due.
6.3 Rights in Collateral; Priority of Liens. Each Borrower and each
---------------------------------------
Subsidiary of each Borrower owns the property granted by it as Collateral under
the Credit Documents, free and clear of any and all Liens in favor of third
parties, except for Permitted Liens. Upon the proper filing of the UCC
financing statements, and the taking of the other actions specified, in the
Closing Document List, the Liens granted pursuant to the Credit Documents will
constitute the valid and enforceable first, prior and perfected Liens on the
Collateral, except, in the case of priorities, for Permitted Liens.
6.4 No Conflict. The execution, delivery and performance by each Borrower
-----------
and each Subsidiary of each Borrower of each Credit Document to which it is a
party: (a) are within its corporate power; (b) are duly authorized by all
necessary corporate action; (c) are not in contravention of any Requirement of
Law or any indenture, contract, lease, agreement, instrument or other commitment
to which it is a party or by which it or any of its properties are bound; (d) do
not require the consent, registration or approval of any Governmental Authority
or any other Person (except such as have been duly obtained, made or given, and
are in full force and effect); and (e) will not, except as contemplated herein,
result in the imposition of any Liens upon any of its properties.
6.5 Enforceability. The Credit Agreement and all of the other Credit
--------------
Documents to which any Borrower or any Subsidiary of any Borrower is a party are
the legal, valid and binding obligations of such Borrower and such Subsidiary,
and are enforceable against each of them, as the case may be, in accordance with
their terms, except as such enforceability may be limited by (a) the effect of
any applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting creditors' rights generally and (b) general principles of equity.
6.6 Consents. No consent or authorization of, filing with or other act by
--------
or in respect of, any Governmental Authority or any other Person is required in
connection with any Credit Event hereunder, the grant of the Liens pursuant to
the Credit Documents, the continuing operations of any Borrower and any
Subsidiary of any Borrower or with the execution, delivery, performance,
validity or enforceability of this Credit Agreement, the Notes or the other
Credit
-51-
Documents, except for the filing of the UCC financing statements and consents or
authorizations which have been obtained or filings which have been made and
which, in each case, are in full force and effect.
6.7 Financial Data. The Borrowers have furnished or caused to be
--------------
furnished to the Lenders the following Financial Statements, which have been
prepared in accordance with GAAP consistently applied throughout the periods
involved: (a) balance sheets as of, and statements of operations, shareholder's
equity and cash flows for the 2000 Fiscal Year, audited by independent certified
public accountants and accompanied by an unqualified opinion thereof; and (b) an
unaudited balance sheet as of, and unaudited statements of operations,
shareholder's equity and cash flows for the Fiscal Quarters ending in December,
2000 and March, 2001, respectively.
6.8 Locations of Officers, Records and Inventory. The address of the
--------------------------------------------
principal place of business and chief executive office of each Borrower and each
Subsidiary of each Borrower is set forth on Schedule B, Part 6.8. The books and
records of each Borrower and each Subsidiary of each Borrower, and all of their
respective chattel paper and records of Accounts, are maintained exclusively at
such locations. There is no location at which any Borrower or any Subsidiary of
any Borrower has any Collateral (except for vehicles and Inventory in transit
for processing in the ordinary course of business) other than those locations
identified on Schedule B, Part 6.8. Schedule B, Part 6.8 also contains a
complete list of the legal names and addresses of each warehouse at which
Inventory is stored. None of the receipts received by any Borrower from any
warehouseman states that the goods covered thereby are to be delivered to bearer
or to the order of a named person or to a named person and such named person's
assigns. Except as set forth on Schedule B, Part 6.8, no Borrower nor any of
its Subsidiaries sells any Inventory on consignment (as such term is defined in
Section 9-114 of the UCC).
6.9 Fictitious Business Names. Except as set forth on Schedule B, Part
-------------------------
6.9, no Borrower and no Subsidiary of any Borrower has used any corporate or
fictitious name (including d/b/a's, tradenames or the like) during the five (5)
years preceding the date hereof, other than the corporate name under which it
has executed this Credit Agreement.
6.10 Subsidiaries. The only Subsidiaries of each Borrower are those listed
------------
on Schedule B, Part 6.10. A Borrower or a wholly-owned Subsidiary of a Borrower
is the record and beneficial owner of all of the issued and outstanding Capital
Securities of each of the Subsidiaries listed on Schedule B, Part 6.10. There
are no proxies, irrevocable or otherwise, with respect to such Capital
Securities, and no Capital Securities of any Subsidiary of any Borrower are or
may become required to be issued by reason of any options, warrants, scrip,
rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into or exchangeable for,
Capital Securities of any Subsidiary of any Borrower, and there are no
contracts, commitments, understandings or arrangements by which any Subsidiary
of any Borrower is or may become bound to issue additional Capital Securities
convertible into or exchangeable for such Capital Securities. All of such
shares listed on Schedule B, Part 6.10 are owned by a Borrower or a Subsidiary
of a Borrower free and clear of any Liens.
-52-
6.11 No Judgments or Litigation. Except (a) as set forth on Schedule B,
--------------------------
Part 6.11, or (b) with respect to matters arising after the Closing Date, that
singly or in the aggregate could not reasonably be expected to have a Material
Adverse Effect, no judgments, orders, writs or decrees are outstanding against
any Borrower or any Subsidiary of any Borrower nor is there now pending or, to
the best of any Borrower's knowledge after diligent inquiry, threatened any
litigation, contested claim, investigation, arbitration, or governmental
proceeding by or against any Borrower or any Subsidiary of any Borrower.
6.12 No Defaults. No Borrower and no Subsidiary of any Borrower is in
-----------
default in any material respect under any term of any indenture, contract,
lease, agreement, instrument or other commitment to which any Borrower or any
Subsidiary of any Borrower is a party or by which any Borrower or any Subsidiary
of any Borrower is bound. No Borrower knows of any material dispute regarding
any such indenture, contract, lease, agreement, instrument or other commitment.
6.13 Labor Matters.
-------------
(a) There are no labor controversies pending or, to the best knowledge of
any Borrower after diligent inquiry, threatened between any Borrower or any
Subsidiary of any Borrower and any of their respective employees, except for any
of the foregoing which singly or in the aggregate could not reasonably be
expected to have a Material Adverse Effect.
(b) No Borrower and no Subsidiary of any Borrower is engaged in any unfair
labor practice, except for any of the foregoing which singly or in the aggregate
could not reasonably be expected to have a Material Adverse Effect. There is (i)
no unfair labor practice complaint pending against any Borrower or any
Subsidiary of any Borrower or, to the best knowledge of any Borrower, threatened
against any of them, before the National Labor Relations Board, and no grievance
or significant arbitration proceeding arising out of or under collective
bargaining agreements is so pending against any Borrower or any Subsidiary of
any Borrower or, to the best knowledge of any Borrower, threatened against any
of them, (ii) no strike, labor dispute, slowdown or stoppage pending against any
Borrower or any Subsidiary of any Borrower or, to the best knowledge of any
Borrower, threatened against any of them and (iii) no union representation
question with respect to the employees of any Borrower or any Subsidiary of any
Borrower and no union organizing activities, except for any of the foregoing
which singly or in the aggregate could not reasonably be expected to have a
Material Adverse Effect.
6.14 Compliance with Law. (a) Except as discussed on Schedule B, Part
-------------------
6.14, no Borrower and no Subsidiary of any Borrower has (i) violated or failed
to comply in any material respect with any Requirement of Law or any requirement
of any self-regulatory organization or (ii) any material Liability of which any
Borrower has knowledge or reasonably should have knowledge in connection with
any release, generation, storage, use, transportation, disposal or other
handling of any hazardous or toxic waste, substance or constituent, or other
substance into the environment, or (iii) received any notice, letter or other
indication of potential Liability arising from the release, generation, storage,
use, transportation, disposal or other handling of any hazardous or toxic waste,
substance or constituent or other substance into the environment.
-53-
(b) Except as disclosed on Schedule B, Part 6.14, none of the operations
of any Borrower or any Subsidiary of any Borrower is the subject of any federal
or state investigation evaluating whether such Borrower or Subsidiary disposed
of any hazardous or toxic waste, substance or constituent or other substance at
any site that may require remedial action, or any federal or state investigation
evaluating whether any remedial action is needed to respond to a release of any
hazardous or toxic waste, substance or constituent, or other substance into the
environment.
6.15 ERISA. No Borrower, no Subsidiary of any Borrower and no ERISA
-----
Affiliate maintains or contributes to any Plan other than those listed on
Schedule B, Part 6.15.
6.16 Intellectual Property. Each Borrower and each Subsidiary of each
---------------------
Borrower possesses such assets, licenses, patents, patent applications,
copyrights, service marks, trademarks and trade names as are necessary or
advisable to continue to conduct its present and proposed business activities.
6.17 Licenses and Permits. Each Borrower and each Subsidiary of each
--------------------
Borrower have obtained and hold in full force and effect, all franchises,
licenses, leases, permits, certificates, authorizations, qualifications,
easements, rights of way and other rights and approvals which are necessary or
advisable for the operation of its businesses as presently conducted and as
proposed to be conducted, except for any such failures to obtain or hold in full
force and effect which singly or in the aggregate could not reasonably be
expected to have a Material Adverse Effect. No Borrower and no Subsidiary of
any Borrower is in violation of the terms of any such franchise, license, lease,
permit, certificate, authorization, qualification, easement, right of way, right
or approval, except for any such violations which singly or in the aggregate
could not reasonably be expected to have a Material Adverse Effect.
6.18 Title to Property. All Real Estate is identified on Schedule B, Part
-----------------
6.18. Each Borrower and each Subsidiary of each Borrower has good and
marketable title in fee simple to, or a valid leasehold interest in, all its
Real Estate, and good title to all its other property, and none of such property
is subject to any Lien, except Permitted Liens.
6.19 Investment Company. No Borrower and no Subsidiary of any Borrower is
------------------
(a) an investment company or a company controlled by an investment company
within the meaning of the Investment Company Act of 1940, as amended, (b) a
holding company or a Subsidiary of a holding company, or an Affiliate of a
holding company or of a Subsidiary of a holding company, within the meaning of
the Public Utility Holding Company Act of 1935, as amended, or (c) subject to
any other law which purports to regulate or restrict its ability to borrow money
or to consummate the transactions contemplated by this Credit Agreement or the
other Credit Documents or to perform its obligations hereunder or thereunder.
6.20 Borrowers' Taxes and Tax Returns.
--------------------------------
(a) Except as set forth on Schedule B, Part 6.20, each Borrower and each
Subsidiary of each Borrower (and any affiliated group of which any Borrower or
any Subsidiary of any Borrower are now or have been members) have timely filed
(inclusive of any permitted extensions) with the appropriate taxing authorities
all returns (including information returns) in
-54-
respect of Borrower Taxes required to be filed through the date hereof and will
timely file (inclusive of any permitted extensions) any such returns required to
be filed on and after the date hereof. The information filed is complete and
accurate in all material respects. All deductions taken by any Borrower as
reflected in such income tax returns have been taken in accordance with
applicable laws and regulations, except deductions that may have been disallowed
but are being challenged in good faith and for which adequate reserves have been
made in accordance with GAAP. Except as specified in Schedule B, Part 6.20, no
Borrower and no Subsidiary of any Borrower, nor any group of which any Borrower
or any Subsidiary of any Borrower are now or were members, have requested any
extension of time within which to file returns (including information returns)
in respect of any Borrower Taxes.
(b) All taxes, assessments, fees and other governmental charges payable by
any Borrower and any Subsidiary of any Borrower (and any affiliated group of
which any Borrower or any Subsidiary of any Borrower is now or has been a
member) in respect of their incomes, franchises, businesses, properties or
otherwise ("Borrower Taxes") in respect of periods beginning prior to the date
hereof, have been timely paid, or will be timely paid, or an adequate reserve
has been established therefor, as set: forth in Schedule B, Part 6.20 or in the
Financial Statements, and no Borrower or Subsidiary of any Borrower has any
liability for taxes in excess of the amounts so paid or reserves so established.
(c) Except as set forth in Schedule B, Part 6.20, no deficiencies for
Borrower Taxes have been claimed, proposed or assessed by any taxing or other
Governmental Authority against any Borrower or any Subsidiary of any Borrower
and no Tax Liens have been filed. Except as set forth in Schedule B, Part 6.20,
there are no pending or, to the best of the knowledge of any Borrower,
threatened audits, investigations or claims for or relating to any liability in
respect of Borrower Taxes, and there are no matters under discussion with any
governmental authorities with respect to Borrower Taxes which are likely to
result in a material additional liability for Borrower Taxes. Either the federal
income tax returns of each Borrower have been audited by the Internal Revenue
Service and such audits have been closed, or the period during which any
assessments may be made by the Internal Revenue Service has expired without
waiver or extension, for all years up to and including the 1997 Fiscal Year.
Except as set forth in Schedule B, Part 6.20, no extension of a statute of
limitations relating to Borrower Taxes is in effect with respect to any Borrower
or any Subsidiary of any Borrower.
(d) Except as set forth on Schedule B, Part 6.20, no Borrower and no
Subsidiary of any Borrower has any obligation under any written Borrower Tax
Sharing Agreement or agreement regarding payments in lieu of Borrower Taxes.
6.21 Status of Accounts. Each Account of each Borrower is based on an
------------------
actual and bona fide sale and delivery of goods or rendition of services to
customers, made by such Borrower in the ordinary course of its businesses; the
goods and inventory being sold by any Borrower and the Accounts created thereby
are the exclusive property of such Borrower and are not and shall not be subject
to any Lien whatsoever other than those arising under the Borrower Security
Agreement and such Borrower's customers have accepted the goods or services, owe
and are obligated to pay the full amounts stated in the invoices according to
their terms, without any dispute, offset, defense, counterclaim or contra.
-55-
6.22 Material Contracts. Schedule B, Part 6.22 contains a true, correct
------------------
and complete list of all the Material Contracts currently in effect on the date
hereof. None of the Material Contracts contains any commercially unreasonable
restrictions on any Borrower or any Subsidiary of any Borrower or any of their
respective properties. All of the Material Contracts are in full force and
effect, and no defaults currently exist thereunder.
6.23 Affiliate Transactions. Except as set forth on Schedule B, Part 6.23,
----------------------
no Borrower and no Subsidiary of any Borrower is a party to or bound by any
agreement or arrangement (whether oral or written) to which any Affiliate of any
Borrower or Subsidiary of any Borrower is a party except (a) in the ordinary
course of and pursuant to the reasonable requirements of such Borrower's or such
Subsidiary's business and (b) upon fair and reasonable terms no less favorable
to such Borrower and such Subsidiary than it could obtain in a comparable arm's-
length transaction with an unaffiliated Person.
6.24 Accuracy and Completeness of Information. All factual information
----------------------------------------
furnished by or on behalf of any Borrower or any Subsidiary of any Borrower in
writing to the Agent, any Lender, or the Auditors for purposes of or in
connection with this Credit Agreement or any of the other Credit Documents, or
any transaction contemplated hereby or thereby is or will be true and accurate
in all material respects on the date as of which such information is dated or
certified and not incomplete by omitting to state any material fact necessary to
make such information not misleading at such time.
6.25 Recording Taxes. All mortgage recording taxes, recording fees and
---------------
other charges payable in connection with the filing and recording of the Credit
Documents have either been paid in full by the Borrowers or arrangements for the
payment of such amounts satisfactory to the Agent shall have been made.
6.26 No Adverse Change or Event. Since the last day of Fiscal Year 2000,
--------------------------
no change in the business, prospects (other than as a result of general
macroeconomic conditions), operations, results of operations, assets,
liabilities or condition (financial or otherwise) of the Credit Parties taken as
a whole has occurred, and no event has occurred or failed to occur, that has had
or might have, either alone or in conjunction with all other such changes,
events and failures, a Material Adverse Effect. Such an adverse change may have
occurred, and such an event may have occurred or failed to occur, at any
particular time notwithstanding the fact that at such time no Default or Event
of Default shall have occurred and be continuing.
6.27 Additional Adverse Facts. Except for facts and circumstances
------------------------
disclosed on Schedule B, Part 6.27, no fact or circumstance is known to any
Borrower, as of the Closing Date, that, either alone or in conjunction with all
other such facts and circumstances, has had or might have (so far as any
Borrower or any Subsidiary of any Borrower can foresee) a Materially Adverse
Effect. If a fact or circumstance disclosed on such Schedule should in the
future have a Materially Adverse Effect, such Materially Adverse Effect shall be
a change or event subject to Section 6.26 notwithstanding such disclosure.
The Borrowers may, at any time and from time to time, upon written notice
to the Agent, amend any one or more of the Schedules referred in this Article 6,
or create any Schedule with respect to any representation or warranty in this
Article 6, and any representation or warranty
-56-
contained herein to which any such Schedule relates shall from and after the
date of any such amendment or creation, as the case may be, refer to such
Schedule as so amended or created, provided, that in no event may any Borrower
amend or create any such Schedule if such amendment or creation would reflect or
evidence a Default or Event of Default, except for any such Default or Event of
Default waived pursuant to Section 11.10.
ARTICLE 7
AFFIRMATIVE COVENANTS
---------------------
Until the Expiration Date and payment and satisfaction of all Obligations:
7.1 Financial Information. The Borrowers shall furnish or cause to be
---------------------
furnished to the Lenders the following information within the following time
periods:
(a) as soon as available and in any event within ninety (90) days after
the end of each Fiscal Year (i) audited Financial Statements as of the close of
such Fiscal Year and for such Fiscal Year, together with comparisons to the
Financial Statements for the prior year and to the most recent projections with
respect to such Fiscal Year delivered pursuant to clause (d) of this Section
7.1, in each case accompanied by (A) an unqualified opinion of the Auditors,
which opinion shall be in scope and substance satisfactory to the Agent in its
sole discretion, (B) such Auditors' "Management Letter" to Parent, (C) a written
statement signed by the Auditors stating that, in the course of the regular
audit of the business of the Credit Parties, which audit was conducted by the
Auditors in accordance with generally accepted auditing standards, the Auditors
have not obtained any knowledge of the existence of any Default or Event of
Default under any provision of this Credit Agreement, or, if such Auditors shall
have obtained from such examination any such knowledge, they shall disclose in
such written statement the existence of the Default or Event of Default and the
nature thereof, it being understood that such Auditors shall have no liability,
directly or indirectly, to anyone for failure to obtain knowledge of any such
Default or Event of Default, (ii) a narrative discussion of the consolidated and
consolidating financial condition and results of operations and the consolidated
and consolidating liquidity and capital resources of Credit Parties for such
fiscal year prepared by a Responsible Officer of Parent and (iii) a compliance
certificate substantially in the form of Exhibit E along with a schedule in form
and substance satisfactory to the Agent of the calculations used in determining,
as of the end of such fiscal year, whether the Borrowers were in compliance with
the covenants set forth in Section 8.1 of this Credit Agreement for such year.
To the extent that Parent's annual report on Form 10-K contains any of the
foregoing items, the Lenders will accept such Form 10-K in lieu of such items;
(b) as soon as available and in any event within forty-five (45) days
after the end of each Fiscal Quarter (except the last Fiscal Quarter of any
Fiscal Year) (i) Financial Statements as at the end of and for such period and
for the current Fiscal Year to date, together with comparisons to the Financial
Statements for the same periods in the prior year and to the most recent
projections with respect to such periods delivered pursuant to clause (d) of
this Section 7.1, all in reasonable detail and duly certified (subject to year-
end audit adjustments) by a Responsible Officer of Parent as having been
prepared in accordance with GAAP, (ii) a narrative discussion of the
consolidated and consolidating financial condition and results of
-57-
operations and the consolidated and consolidating liquidity and capital
resources of the Credit Parties for such period and for the Fiscal Year to date
prepared by a Responsible Officer of Parent, (iii) a compliance certificate
substantially in the form of Exhibit E along with a schedule in form and
substance satisfactory to the Agent of the calculations used in determining, as
of the end of such fiscal quarter, whether the Borrowers were in compliance with
the covenants set forth in Articles 7 and 8 of this Credit Agreement for such
quarter. To the extent that Parent's quarterly report on Form 10-Q contains any
of the foregoing terms, the Lenders will accept such Form 10-Q in lieu of such
items;
(c) as soon as available and in any event within thirty (30) days after
the end of each Fiscal Month (except the last Fiscal Month of any Fiscal
Quarter, with respect to which such reports shall be delivered within forty-five
(45) days after the end of such Fiscal Month (other than the last Fiscal Quarter
of any Fiscal Year with respect to which such reports shall be delivered within
ninety (90) days after the end of such Fiscal Month)), (i) Financial Statements
as at the end of such Fiscal Month and consolidated and consolidating statements
of operations and cash flows for such Fiscal Month and for the current Fiscal
Year to date, together with a comparison to the consolidated and consolidating
balance sheets, statements of operations and statements of cash flows for the
same periods in the prior Fiscal Year, all in reasonable detail and duly
certified (subject to year-end audit adjustments) by a Responsible Officer of
Parent as having been prepared in accordance with GAAP, (ii) a compliance
certificate substantially in the form of Exhibit E along with a schedule in form
and substance satisfactory to the Agent of the calculations used in determining,
as of the end of such Fiscal Month, whether the Borrowers were in compliance
with the covenants set forth in Articles 7 and 8 of this Credit Agreement for
such Fiscal Month;
(d) not later than forty-five (45) days prior to the end of each Fiscal
Year commencing with the 2001 Fiscal Year, monthly projections of the
consolidated and consolidating financial condition and results of operations of
the Consolidated Entity for the following Fiscal Year and annual projections for
each subsequent Fiscal Year through and including the Fiscal Year in which the
Expiration Date occurs, including, but not limited to, projected consolidating
balance sheets, consolidated and consolidating statements of operations,
consolidated and consolidating statements of cash flows and consolidated and
consolidating statements of changes in shareholders' equity for such Fiscal
Years;
(e) a copy of the state and federal income tax returns of each Borrower
and each Subsidiary of each Borrower within thirty (30) days after they are
filed with the appropriate taxing authorities, if and when requested by any
Lender;
(f) upon request by the Agent at any time and in any event not later than
12:00 Noon on the third Business Day of each week (other than the last week of
any month covered by a monthly certificate), and within five (5) Business Days
after the last Business Day of each month (provided that no weekly certificate
need be delivered unless at the time such delivery would otherwise be required
pursuant to the terms of this clause (f), based on the most recent Borrowing
Base Certificate delivered by the Borrowers to the Agent hereunder, there shall
be unused availability under the Borrowing Base of less than $30,000,000), a
borrowing base certificate (the "Borrowing Base Certificate") in the form of
Exhibit F, duly completed, detailing each Borrower's Eligible Accounts
Receivable and Eligible Inventory as of each Friday
-58-
of the immediately preceding week and as of the last day of such month, as
applicable (or such other date as the Agent may specify in such request), and
certified by a Responsible Officer of Parent and subject only to adjustment upon
completion of the normal year-end audit of physical inventory. In addition, each
Borrowing Base Certificate shall have attached to it such additional schedules
and/or other information as the Agent may request;
(g) promptly and in any event within three (3) Business Days after
becoming aware of the occurrence of a Default or Event of Default, a certificate
of a Responsible Officer of Parent specifying the nature thereof and the
proposed response thereto, each in reasonable detail;
(h) promptly upon the earlier of the mailing or filing thereof, copies of
all 00-Xx, 00-Xx, 0-Xx, proxy statements, annual reports, quarterly reports,
registration statements and any other filings or other communications made by
any Borrower to holders of its publicly traded securities or the Securities
Exchange Commission from time to time pursuant to the Securities Exchange Act of
1934, as amended, or the Securities Act of 1933, as amended;
(i) from time to time, such further information regarding the Collateral,
business affairs and prospects and financial condition of each Borrower and each
Subsidiary of each Borrower as the Agent may reasonably request; and
(j) within ten (10) Business Days after the occurrence thereof, notice of
any Casualty Loss.
7.2 Inventory. Promptly, upon the request of the Agent from time to time,
---------
each Borrower shall provide to the Agent written statements listing items of
Inventory in reasonable detail as requested by the Agent. Each Borrower shall
conduct or cause to be conducted annually a physical count of the Inventory and,
a copy of such count shall be promptly supplied to the Agent accompanied by a
report of the value (valued at FIFO) of such Inventory. Each Borrower shall
conduct such a physical count at such other times and as of such dates as the
Agent shall reasonably request. In addition to, and not in limitation of, the
foregoing, at any time and from time to time the Agent may conduct (or engage
third parties to conduct) such field examinations, appraisals, verifications and
evaluations of the Inventory as the Agent shall deem necessary or appropriate in
the exercise of its sole discretion. If any Inventory of a Borrower is at any
time hereafter stored or located at any warehouse not owned or leased by such
Borrower, then such Borrower shall promptly deliver to such warehouseman
notification of the Agent's Lien on such Inventory and shall take such other
steps as the Agent reasonably requires to perfect its Liens thereon.
7.3 Corporate Existence. Each Borrower shall, and shall cause each of its
-------------------
Subsidiaries to, (a) maintain its corporate existence (except that Subsidiaries
of any Borrower may merge with wholly-owned Subsidiaries of such or any other
Borrower upon providing the Agent with ten (10) days' prior written notice) and
maintain in full force and effect all licenses, bonds, franchises, leases,
trademarks and qualifications to do business, and all patents, contracts and
other rights necessary to the profitable conduct of their businesses, and (b)
continue in, and limit their operations to, the same general lines of business
as presently conducted by it.
-59-
7.4 ERISA. Each Borrower shall deliver to the Agent and each of the
-----
Lenders, at such Borrower's expense, the following information at the times
specified below:
(a) within thirty (30) days after the filing thereof with the DOL,
Internal Revenue Service or PBGC, copies of each annual report (form 5500
series), including Schedule B thereto, filed with respect to each Benefit Plan;
(b) within thirty (30) days after receipt by such Borrower, any Subsidiary
of such Borrower or any ERISA Affiliate of each actuarial report for any Benefit
Plan or Multiemployer Plan and each annual report for any Multiemployer Plan,
copies of each such report;
(c) within ten (10) days upon the occurrence thereof, notification of any
increase in the benefits of any existing Plan or the establishment of any new
Plan or the commencement of contributions to any Plan to which such Borrower,
any Subsidiary of such Borrower or any ERISA Affiliate was not previously
contributing; and
(d) within three (3) days upon the occurrence thereof, any event or
condition referred to in clauses (i) through (vii) of Section 9.1(i), whether or
not such event or condition shall constitute an Event of Default.
Each Borrower and its Subsidiaries shall establish, maintain and operate
all Plans to comply in all material respects with the provisions of ERISA, the
Code, and all other Requirements of Law, other than to the extent that such
Borrower or any such Subsidiary (i) is in good faith contesting by appropriate
proceedings the validity or application of any such provision, law, rule,
regulation or interpretation and (ii) has made an adequate reserve or other
appropriate provision therefor as required in order to be in conformity with
GAAP.
7.5 Books and Records. Each Borrower agrees to maintain, and to cause
-----------------
each of its Subsidiaries to maintain, books and records, including those
pertaining to the Collateral, in such detail, form and scope as is consistent
with good business practice, and agrees that such books and records will reflect
the Agent's and Lenders' respective interests in its Accounts. Each Borrower
agrees that the Agent or its agents may enter upon the premises of such Borrower
or any Subsidiary of such Borrower at any time and from time to time, during
normal business hours and upon reasonable notice under the circumstances, and at
any time at all on and after the occurrence of a Default, and which has not
otherwise been waived pursuant to Section 11.10, for the purposes of (a)
conducting field examinations and appraisals and inspecting, evaluating and
verifying the Collateral, (b) inspecting and/or copying (at such Borrower's
expense) any and all records pertaining thereto and (c) discussing the business
affairs and prospects and financial condition of such or any other Borrower and
each Subsidiary of such or any other Borrower with any officers, employees and
directors of such Borrower or such Subsidiary or with the Auditors. Each
Borrower shall give the Agent thirty (30) days prior written notice of any
change in the location of any Collateral or in the location of its chief
executive office or place of business from the locations specified in Schedule
B, and each Borrower shall execute in advance of such change and cause to be
filed and/or delivered to the Agent any financing statements, Collateral Access
Agreements or other documents required by the Agent, all in form and substance
satisfactory to the Agent. Each Borrower agrees to advise the Agent promptly,
in sufficient detail, of any substantial changes relating to the type, quantity
or quality of the Collateral, or any
-60-
event which singly or in the aggregate reasonably be expected to have a material
adverse effect on the value of the Collateral or on the Liens granted for the
benefit of the Agent, the Lenders and the Issuing Lenders thereon.
7.6 Collateral Records. Each Borrower agrees to execute and deliver
------------------
promptly, and to cause each of its Subsidiaries to execute and deliver promptly,
to the Agent, from time to time, solely for the Agent's convenience in
maintaining a record of the Collateral, such written statements and schedules as
the Agent may reasonably require, including those described in Section 7.1 of
this Credit Agreement, designating, identifying or describing the Collateral.
The failure by any Borrower or any Subsidiary of any Borrower, however, to
promptly give the Agent such statements or schedules shall not affect, diminish,
modify or otherwise limit the Liens on the Collateral granted pursuant to the
Credit Documents.
7.7 Security Interests. Each Borrower shall, and shall cause each of its
------------------
Subsidiaries to, defend the Collateral against all claims and demands of all
Persons at any time claiming the same or any interest therein. Each Borrower
shall, and shall cause each of its Subsidiaries to, comply with the requirements
of all state and federal laws in order to grant to the Agent, the Lenders and
the Issuing Lenders valid and perfected first priority security interests in the
Collateral, with perfection, in the case of any investment property, being
effected by giving the Agent control of such investment property, rather than by
the filing of a UCC financing statement with respect to such investment
property. The Agent is hereby authorized by each Borrower to file any UCC
financing statements covering the Collateral whether or not such Borrower's
signatures appear thereon. Each Borrower shall, and shall cause each of its
Subsidiaries to, do whatever the Agent may reasonably request, from time to
time, to effect the purposes of this Credit Agreement and the other Credit
Documents, including filing notices of liens, UCC financing statements, fixture
filings and amendments, renewals and continuations thereof; cooperating with the
Agent's representatives; keeping stock records; obtaining waivers from landlords
and mortgagees and from warehousemen and their landlords and mortgagees; and,
paying claims which might, if unpaid, become a Lien on the Collateral.
7.8 Insurance; Casualty Loss.
------------------------
(a) Each Borrower agrees to maintain, and to cause each of its
Subsidiaries to maintain, public liability insurance, third party property
damage insurance and replacement value insurance on the Collateral under such
policies of insurance, with such insurance companies, in such amounts and
covering such risks as are at all times satisfactory to the Agent in its
commercially reasonable judgement. All policies covering the Collateral are to
name the Agent as an additional insured and the loss payee in case of loss, and
are to contain such other provisions as the Agent may reasonably require to
fully protect the interest of the Lenders in the Collateral and to any payments
to be made under such policies. Each Borrower shall diligently file and
prosecute, or cause to be filed and prosecuted, all claims for any award or
payment in connection with a Casualty Loss with respect to such Borrower. Each
Borrower shall receive in trust and pay to the Agent, promptly upon receipt
thereof, the Net Disposition Proceeds of all Casualty Losses with respect to
such Borrower, for application to the Loans. After the occurrence and during the
continuance of an Event of Default, (A) no settlement on account of any such
Casualty Loss with respect to any Borrower shall be made without the consent of
the Lenders and (B) the Agent may participate in any such proceedings and the
applicable Borrower
-61-
shall deliver to the Agent such documents as may be requested by the Agent to
permit such participation and shall consult with the Agent, its attorneys and
agents in the making and prosecution of such claim or claims. Each Borrower
hereby irrevocably authorizes and appoints the Agent its attorney-in-fact, and
agrees that, upon request, it will cause each Subsidiary of such Borrower to
authorize and appoint the Agent its attorney-in-fact, after the occurrence and
during the continuance of an Event of Default, to collect and receive any such
award or payment and to file and prosecute such claim or claims, which power of
attorney shall be irrevocable and shall be deemed to be coupled with an
interest, and each Borrower shall, upon demand of the Agent, make, execute and
deliver, and cause each of its Subsidiaries to make, execute and deliver, any
and all assignments and other instruments sufficient for the purpose of
assigning any such award or payment to the Agent for the benefit of the Agent,
the Lenders and the Issuing Lenders, free and clear of any encumbrances of any
kind or nature whatsoever.
(b) Notwithstanding anything to the contrary contained herein, upon the
occurrence of any Casualty Loss with respect to fixed assets of any Borrower or
any Subsidiary of any Borrower, the Agent shall establish a reserve against
unused availability under the Borrowing Base in an amount equal to the orderly
liquidation value of such fixed assets (as determined by the Agent in its sole
and absolute discretion). Each such reserve shall remain in effect until such
time as the Net Disposition Proceeds of such Casualty Loss are received by the
Agent for application to the Loans, at which time the Fixed Asset Sublimit shall
be automatically and permanently reduced by an amount equal to the greater of
(i) such Net Disposition Proceeds and (ii) such orderly liquidation value;
provided, that, with respect to no more than $5,000,000 of such Net Disposition
Proceeds in any Fiscal Year, upon written notice from the Funds Administrator to
the Agent given promptly following receipt by the Agent of such Net Disposition
Proceeds, the Borrowers may elect to use such Net Disposition Proceeds to
repair, rebuild or replace the applicable fixed assets (or permitted portion
thereof), in which case no reduction in the Fixed Asset Sublimit in respect
thereof shall be required.
7.9 Borrower's Taxes. Each Borrower agrees to pay, when due, and to cause
----------------
each of its Subsidiaries to pay when due, all Borrower Taxes lawfully levied or
assessed against such Borrower, any Subsidiary of such Borrower or any of their
properties, including any of the Collateral, before any penalty or interest
accrues thereon; provided that, unless such Borrower's Taxes have become a
federal tax or ERISA Lien on any of the assets of such Borrower or any such
Subsidiary, no such Borrower's Taxes need be paid if the same is being
contested, in good faith, by appropriate proceedings promptly instituted and
diligently conducted and if an adequate reserve or other appropriate provision
shall have been made therefor as required in order to be in conformity with
GAAP.
7.10 Compliance With Laws. (a) Except for any such failures to comply
--------------------
which singly or in the aggregate could not reasonably be expected to have a
Material Adverse Effect, each Borrower agrees to comply, and to cause each of
its Subsidiaries to comply, with all Requirements of Law applicable to its
business or its operations or to the Collateral or any part thereof.
(b) Within fifteen (15) days after any Borrower learns of the enactment or
promulgation of any Requirement of Law which could reasonably be expected to
have a Material Adverse Affect, such Borrower shall provide the Agent with
notice thereof.
-62-
(c) At the request of the Agent from time to time, but in any event not
more frequently than once in any twelve month period, and at the sole cost and
expense of the Borrowers, each Borrower shall retain an environmental consulting
firm, satisfactory to Agent in its commercially reasonable judgment, to conduct
an environmental review, audit or investigation of the specific items as
requested by the Agent relating to the properties of such Borrower and its
Subsidiaries located in the United States and provide to the Agent and each
Lender a copy of any reports delivered in connection therewith. At the request
of the Agent, each Borrower shall provide the Agent with any additional
information relating to environmental matters and any potential related
liability resulting therefrom as the Agent may reasonably request.
7.11 Use of Proceeds. The initial Loans made to the Borrowers hereunder
---------------
shall be used by the Borrowers to refinance certain unsecured Indebtedness of
the Credit Parties and to pay the costs and expenses of the transactions
contemplated by this Credit Agreement which are due and payable on the Closing
Date, including the Fees and Expenses due on the Closing Date pursuant to
Article 4; and the proceeds of any subsequent Loans made hereunder shall be used
by the Borrowers solely for working capital and other general corporate
purposes, including Investments consisting of Acquisitions permitted pursuant to
Section 8.9(f). The Borrowers shall not use any portion of the proceeds of any
such Loans for the purpose of purchasing or carrying any "margin stock" (as
defined in Regulation U of the Board of Governors of the Federal Reserve System)
in any manner which violates the provisions of Regulation U or X of said Board
of Governors or for any other purpose in violation of any applicable statute or
regulation, or of the terms and conditions of this Credit Agreement.
7.12 Fiscal Year. Each Borrower agrees to maintain its Fiscal Year as a
-----------
year ending on the Sunday closest to September 30th of the applicable year
unless otherwise required by law, in which case such Borrower will give the
Agent at least thirty (30) days prior written notice thereof.
7.13 Notification of Certain Events. Each Borrower agrees that it shall
------------------------------
promptly (but, in the case of clause (g), in any event within ten (10) days
after such Borrower learns of any such proceeding, change, development or event)
notify the Agent of:
(a) any Material Contract of such Borrower or any of its Subsidiaries that
is terminated or amended (in any material and adverse respect) or any new
Material Contract that is entered into (in which event such Borrower shall
provide the Agent with a copy of such Material Contract);
(b) any material and adverse change or amendment of the material terms
upon which suppliers of such Borrower or any of its Subsidiaries do business
with such Borrower or Subsidiary;
(c) the entry of any order, judgment or decree in excess of $500,000
against such Borrower or any of its Subsidiaries or any of their respective
properties or assets;
(d) receipt by such Borrower or any of its Subsidiaries of any
notification of violation in any material respect of any Requirement of Law from
any Governmental Authority;
-63-
(e) any actual, or (other than as a result of general macroeconomic
conditions) prospective, change, development or event which has had or could
reasonably be expected to have a Material Adverse Effect;
(f) any proceedings being instituted or threatened to be instituted by or
against such Borrower or any of its Subsidiaries, before any Governmental
Authority or arbitrator; and
(g) any Event of Default or Default.
7.14 Intellectual Property. Except for any such failures to preserve and
---------------------
keep in full force and effect which singly or in the aggregate could not
reasonably be expected to have a material adverse effect, each Borrower shall,
and shall cause each of its Subsidiaries to, do and cause to be done all things
necessary to preserve and keep in full force and effect all registrations of
patents, copyrights, trademarks, service marks and other marks, trade names or
other trade rights.
7.15 Maintenance of Property. Each Borrower agrees to keep, and to cause
-----------------------
each of its Subsidiaries to keep, all property useful and necessary to its
respective businesses in good working order and condition (ordinary wear and
tear excepted) in accordance with their past operating practices and not to
commit or suffer any waste with respect to any of its properties.
7.16 Further Assurances. Each Borrower shall take promptly, and shall
------------------
cause each of its Subsidiaries to take promptly, all such further actions and
execute all such further documents and instruments as the Agent may at any time
reasonably determine in its sole discretion to be necessary or desirable to
further carry out and consummate the transactions contemplated by the Credit
Documents, to cause the execution, delivery and performance of the Credit
Documents to be duly authorized and to perfect or protect the Liens (and the
priority status thereof) of the Agent on the Collateral.
7.17 Changes in Market. Each Borrower agrees that the Agent shall be
-----------------
entitled, after consultation with the Borrowers, to change the terms and
conditions, pricing and structure of the credit facilities extended hereunder if
the Agent determines that such changes are advisable to ensure the successful
initial syndication thereof, provided, that the Total Commitments remain
unchanged.
ARTICLE 8
NEGATIVE COVENANTS
------------------
Until the Expiration Date and payment and satisfaction of all Obligations,
each Borrower agrees that:
8.1 Consolidated Fixed Charge Coverage Ratio. The Borrowers shall not
----------------------------------------
permit the Consolidated Fixed Charge Coverage Ratio for the twelve (12) Fiscal
Months ending on the last day of each Fiscal Quarter set forth below to be less
than the ratio set forth below opposite such Fiscal Quarter:
-64-
Fiscal Quarter Minimum Ratio
-------------- -------------
Fourth Fiscal Quarter 2001 1.00 to 1.00
First Fiscal Quarter 2002 1.00 to 1.00
Second Fiscal Quarter 2002 1.00 to 1.00
Third Fiscal Quarter 2002 1.00 to 1.00
Fourth Fiscal Quarter 2002 1.10 to 1.00
First Fiscal Quarter 2003 1.10 to 1.00
Second Fiscal Quarter 2003 1.10 to 1.00
Third Fiscal Quarter 2003 1.10 to 1.00
Fourth Fiscal Quarter 2003 and 1.15 to 1.00
each Fiscal Quarter thereafter
8.2 Capital Expenditures. No Borrower shall, or shall permit any of its
--------------------
Subsidiaries to, directly or indirectly, make payments for Capital Expenditures
in any Fiscal Year set forth below, in the aggregate for all Borrowers and their
respective Subsidiaries combined, in excess of the sum of (a) the amount set
forth opposite such date, plus (b) fifty percent (50%) of the amount permitted
to be spent on capital expenditures pursuant to clause (a) of this Section 8.2
in the immediately preceding Fiscal Year and not so used, plus (c) to the extent
that, in the absence of such allocation, the aggregate amount of all such
payments for Capital Expenditures in any such Fiscal Year would exceed the
aggregate amount permitted pursuant to foregoing clauses (a) and (b), that
portion of the Excess Cash Flow Allowance, if any, allocated to Capital
Expenditures in such Fiscal Year pursuant to a certificate of a Responsible
Officer of the Funds Administrator delivered to the Agent (any such allocation
to be irrevocable and binding upon the Funds Administrator and the Borrowers):
Fiscal Year Maximum Capital Expenditures
----------- ----------------------------
2001 $11,500,000
2002 $13,500,000
2003 and each Fiscal Year thereafter $15,000,000
No Borrower shall, or shall permit any of its Subsidiaries to, directly or
indirectly, make any Capital Expenditures that are not directly related to the
businesses (or to a substantially similar line of business) conducted on the
Closing Date by such Borrower or such Subsidiary.
8.3 No Additional Indebtedness. No Borrower shall, or shall permit any
--------------------------
of its Subsidiaries to, directly or indirectly, incur, create, assume or suffer
to exist any Indebtedness other than:
(a) (i) Indebtedness secured by Purchase Money Liens, and (ii)
Indebtedness consisting of regularly scheduled rental payments under Capital
Leases (such Capital Leases in any event to be entered into on commercially
reasonable terms); provided that the Indebtedness described in the foregoing
clauses (i) and (ii) shall not exceed, in the aggregate for the Borrowers and
their respective Subsidiaries combined, $3,000,000 outstanding at any one time;
-65-
(b) Indebtedness arising under this Credit Agreement and the other Credit
Documents;
(c) Indebtedness of any Borrower to any other Borrower; and
(d) Indebtedness evidenced by the Subordinated Notes in an original
principal amount not exceeding $100,000,000;
(e) Indebtedness described on Schedule B, Part 8.3(e) and any refinancing
of such Indebtedness; provided that the aggregate principal amount of such
Indebtedness is not increased and such refinancing is on terms and conditions
that are (i) no more restrictive than the terms and conditions of the
Indebtedness being refinanced and (ii) reasonably acceptable to the Agent; and
(f) obligations incurred in connection with Acquisitions permitted
pursuant to Section 8.9 in respect of usual and customary provisions regarding
post-closing purchase price adjustment and indemnification in the agreements
governing such Acquisitions.
8.4 No Liens; Judgments. No Borrower shall, or shall permit any of its
-------------------
Subsidiaries to, directly or indirectly, mortgage, assign, pledge, transfer,
create, incur, assume, suffer to exist or otherwise permit any Lien (whether as
a result of a purchase money or title retention transaction, or other security
interest, judgment or otherwise) to exist on any of its property, assets,
revenues or goods, whether real, personal or mixed, whether now owned or
hereafter acquired, except for the following (the "Permitted Liens"):
(a) Liens granted by such Borrower or Subsidiary pursuant to any Credit
Document;
(b) Liens listed on Schedule B, Part 8.4(b);
(c) Purchase Money Liens;
(d) Liens of warehousemen, mechanics, material men, workers, repairmen,
common carriers, landlords and other similar Liens arising by operation of law
or otherwise, not waived in connection herewith, for amounts that are not yet
due and payable or which are being diligently contested in good faith by such
Borrower or Subsidiary by appropriate proceedings;
(e) Attachment and judgment Liens securing outstanding liabilities of any
Borrower or any Subsidiary of any Borrower which individually or in the
aggregate for all such Liens are not in excess of $500,000 for all Borrowers and
their respective Subsidiaries combined (exclusive of (i) any amounts that are
duly bonded to the reasonable satisfaction of the Agent or (ii) any amount
adequately covered by insurance as to which the insurance company has not
disclaimed or disputed in writing its obligations for coverage);
(f) Liens for Borrower's Taxes not yet due and payable or which are being
diligently contested in good faith by such Borrower by appropriate proceedings,
provided that in any such case an adequate reserve is being maintained by such
Borrower for the payment of same;
-66-
(g) Deposits or pledges to secure obligations under workmen's
compensation, social security or similar laws, or under unemployment insurance
not to exceed an aggregate of $500,000 outstanding at any one time for all
Borrowers and their respective Subsidiaries combined;
(h) Deposits or pledges to secure bids, tenders, contracts (other than
contracts for the payment of money), leases, statutory obligations, surety and
appeal bonds and other obligations of like nature arising in the ordinary course
of business not to exceed an aggregate of $500,000 outstanding at any one time
for all Borrowers and their respective Subsidiaries combined;
(i) Easements, rights-of-way, restrictions and other similar encumbrances
incurred in the ordinary course of business which, in the aggregate, are not
substantial in amount and which do not materially detract from the value of the
property subject thereto or materially interfere with the ordinary conduct of
the business of any Borrower or any Subsidiary of any Borrower; and
(j) Extensions and renewals of the foregoing permitted Liens; provided
that the aggregate amount of such extended or renewed Liens is not increased and
such extended or renewed Liens are on terms and conditions no more restrictive
than the terms and conditions of the Liens being extended or renewed.
For the purposes of Section 8.4(e), (g) and (h), Liabilities and
obligations referred to therein shall remain "outstanding", notwithstanding the
sale or other disposition of property subject to a Lien permitted thereunder.
8.5 No Sale of Assets. No Borrower shall, or shall permit any of its
-----------------
Subsidiaries to, directly or indirectly, sell, lease, assign, transfer or
otherwise dispose of any assets other than (a) Inventory in the ordinary course
of business, (b) individual items of Collateral (other than any Capital
Securities of any of its Subsidiaries), with a book value of less than, in the
aggregate for all Borrowers and their respective Subsidiaries combined, during
any Fiscal Year, $250,000, (c) the Permitted Dispositions, (d) outdated and worn
out property disposed of in the ordinary course of business and (e) other
dispositions of assets, provided that (i) such other dispositions are for fair
value; (ii) one hundred percent (100%) of the consideration for each of such
other dispositions is received by the applicable Borrower in the form of cash;
and (iii) the consideration for such other dispositions does not exceed, in the
aggregate for all Borrower and their respective Subsidiaries combined, for any
Fiscal Year, $2,500,000.
8.6 No Corporate Changes. No Borrower shall, or shall permit any of its
--------------------
Subsidiaries to, directly or indirectly, merge, consolidate or otherwise alter
or modify such Borrower's or such Subsidiary's Governing Documents, corporate
name, mailing addresses, principal places of business, structure, status or
existence, or enter into or engage in any operation or activity materially
different from that currently being conducted by such Borrower or such
Subsidiary, except that any Borrower or any Subsidiary of a Borrower may be
merged or consolidated with or into such or any other Borrower, provided that
(a) a Borrower shall be the continuing or surviving corporation and (b) no
Default or Event of Default shall exist or result therefrom.
-67-
8.7 No Guaranties. No Borrower shall, or shall permit any of its
-------------
Subsidiaries to, directly or indirectly, issue or assume any Guaranty with
respect to the Liabilities of any other Person, including any Subsidiary or
Affiliate of such or any other Borrower, except (a) by the endorsement of
negotiable instruments for deposit or collection or similar transactions in the
ordinary course of business, (b) by the giving of indemnities in connection with
the sale of Inventory or other asset dispositions permitted hereunder and (c)
Indebtedness permitted to be incurred pursuant to Section 8.3.
8.8 No Restricted Payments. No Borrower shall, or shall permit any of its
----------------------
Subsidiaries to, directly or indirectly make any Restricted Payment, provided,
that:
(a) any wholly-owned Subsidiary of any Borrower may declare and pay
dividends and make other distributions to such Borrower;
(b) Parent may repurchase issued and outstanding Capital Securities of
Parent (or options to purchase Capital Securities of Parent), so long as
immediately before and after giving effect thereto, (i) no Event of Default
shall have occurred and be continuing; (ii) the lesser at such time of (x) the
Line of Credit and (y) the Borrowing Base minus, in each case, Total Exposure,
shall not be less than $25,000,000, and (iii) the aggregate amount of such
Restricted Payments do not exceed (x) $2,000,000 during the twelve (12) Fiscal
Month period ending on the last day of the Fiscal Quarter immediately preceding
the Fiscal Quarter in which such Restricted Payment is made or (y) $600,000
during any period of three (3) Fiscal Months ending during such twelve (12)
Fiscal Month period; or, if the ratio of Consolidated Total Indebtedness, as
determined as of the last day of the Fiscal Quarter immediately preceding the
Fiscal Quarter in which such Restricted Payment is made, to Consolidated EBITDA
for the twelve (12) Fiscal Month period ending on such date, is greater than 3.5
to 1.0, the aggregate amount of such Restricted Payments shall not exceed (x)
$1,000,000 during the twelve (12) Fiscal Month period ending on the last day of
the Fiscal Quarter immediately preceding the Fiscal Quarter in which such
Restricted Payment is made or (y) $400,000 during any period of three (3) Fiscal
Months ending during such twelve (12) Fiscal Month period; and
(c) Parent may make regularly scheduled payments of interest under the
Subordinated Notes, at the respective times and in the respective amounts
required under the Subordinated Note Indenture, to the extent permitted pursuant
to Article 10 of the Subordinated Note Indenture.
----------
8.9 No Investments. No Borrower shall, or shall permit any of its
--------------
Subsidiaries to, directly or indirectly, make any Investment in any Person other
than:
(a) Advances or loans to employees made in the ordinary course of
business;
(b) Cash Equivalents;
(c) Interest-bearing demand or time deposits (including certificates of
deposit) which are insured by the Federal Deposit Insurance Corporation ("FDIC")
or a similar federal insurance program; however, provided that such Borrower
may, in the ordinary course of its
-68-
business, maintain in its disbursement accounts from time to time accounts in
excess of then applicable FDIC or other program insurance limits;
(d) guaranties permitted under Section 8.7;
(e) Indebtedness permitted under Sections 8.3(d) and (e); and
(f) investments in connection with Acquisitions, provided that:
(i) not later than thirty (30) days prior to the date of
consummation of each Acquisition, the Agent shall have received (with results
satisfactory to the Agent) a due diligence report in connection therewith in
form and substance satisfactory to the Agent in its sole discretion prepared by
the Auditors (or another nationally-recognized firm of independent certified
public accountants selected by the Borrowers and satisfactory to the Agent in
its sole discretion), the scope of such due diligence report, and the specific
procedures utilized in the preparation thereof, to be approved in writing by the
Agent prior to the commencement of any field or other work performed in
connection therewith,
(ii) on the date of consummation of each such Acquisition, Agent
shall have received a certificate duly executed by a Responsible Officer of
Parent certifying that the financial condition referred to in clause (iii) below
with respect thereto is satisfied, together with evidence thereof reasonably
satisfactory to the Agent,
(iii) the Consolidated Fixed Charge Coverage Ratio, determined on a
pro forma basis (giving effect to adjustments to conform accounting policies, to
reflect reduction of compensation and, to the extent agreed to by the Agent in
its sole discretion, other anticipated cost savings) for the period of four (4)
consecutive Fiscal Quarters ending on the last day of the last completed Fiscal
Quarter immediately preceding the proposed date of consummation of such
Acquisition (on the assumption such Acquisition occurred on the first day of
such four Fiscal Quarter period and using historical results of the Consolidated
Entity and the related Acquisition Prospect for such period), shall be at least
equal to the minimum ratio with respect to such period required pursuant to
Section 8.1,
(iv) each such Acquisition shall be consummated (x) in accordance
with all applicable Requirements of Law and the applicable Borrower and
Acquisition Target shall have obtained all consents and approvals of
Governmental Authorities necessary in connection therewith and with the business
operations of the related Acquisition Target after such Acquisition and (y)
pursuant to such agreements, documents and instruments as shall be in each case
in form and substance reasonably satisfactory to the Agent in its sole
discretion,
(v) the related Acquisition Target shall be engaged in the same or
substantially similar lines of business currently being conducted by the
Borrowers,
(vi) no Default or Event of Default shall exist at the time of
consummation thereof or would result therefrom,
-69-
(vii) before and after giving to each such Acquisition, the lesser at
such time of (x) the Line of Credit and (y) the Borrowing Base minus, in each
case, Total Exposure shall not be less than $25,000,000,
(viii) before and after giving effect to each such Acquisition, the
ratio of Consolidated Total Indebtedness as of the last day of the Fiscal
Quarter ending immediately prior to the Fiscal Quarter in which such Acquisition
is consummated, to Consolidated EBITDA for the twelve month period ending as of
such day, is less than 3.75 to 1.00,
(ix) the Fiscal Quarter during which such Acquisition is consummated
is no earlier than the second Fiscal Quarter of the 2002 Fiscal Year, and
(x) such Acquisition is structured as an asset purchase and does
not result in the assumption of any Liabilities by any Credit Party other than
(i) trade and operating lease payables incurred by the Acquisition Target in the
ordinary course of business and (ii) such other Liabilities incurred by the
Acquisition Target in the ordinary course of business and reasonably acceptable
to Agent, and
(xi) the total consideration (including equity roll-overs, non-
compete and earn-out payments and any other similar forms of consideration) paid
by the Borrowers in connection with such Acquisition, when added to the total
such consideration paid by the Borrowers in connection with all other
Acquisitions consummated after the Closing Date, does not exceed in the
aggregate $10,000,000 plus, to the extent that, in the absence of such
allocation, the total consideration paid by the Borrowers in connection with
Acquisitions would exceed such amount, that portion of the Excess Cash Flow
Allowance, if any, allocated to the consummation of any Acquisition pursuant to
a certificate of a Responsible Officer of the Funds Administrator delivered to
the Agent (any such allocation to be irrevocable and binding upon the Funds
Administrator and the Borrowers); and
(g) Such other Investments as the Agent may approve in writing in its sole
discretion.
8.10 No Affiliate Transactions. Except for transactions expressly
-------------------------
permitted pursuant to Section 8.8, no Borrower shall, or shall permit any of its
Subsidiaries to, directly or indirectly, enter into any transaction with,
including the purchase, sale or exchange of property or the rendering of any
service to any other Borrower or Subsidiary of a Borrower or other Affiliate of
a Borrower and whether or not such transaction would otherwise be permitted
under any of the other provisions of the Credit Documents, except in the
ordinary course of and pursuant to the reasonable requirements of such
Borrower's or such Subsidiary's business, as the case may be, and upon fair and
reasonable terms no less favorable to such Borrower or such Subsidiary than
could be obtained in a comparable arms-length transaction with an unaffiliated
Person.
8.11 Limitation on Transactions Under ERISA. No Borrower shall, or shall
--------------------------------------
permit any of its Subsidiaries to, directly or indirectly:
(a) amend, or permit any ERISA Affiliate to amend, a Benefit Plan
resulting in an increase in current liability for the plan year such that any of
such Borrower, any Subsidiary of
-70-
such Borrower, any Subsidiary of such Borrower or any ERISA Affiliate is
required to provide security to such a Benefit Plan under Section 401(a)(29) of
the Code; or
(b) allow the representation made in Section 6.15 to be untrue at any
time.
8.12 No Additional Bank Accounts. Except with the prior written consent
---------------------------
of the Agent, no Borrower shall, or shall permit any of its Subsidiaries to,
directly or indirectly, open, maintain or otherwise have any checking, savings
or other accounts at any bank or other financial institution, or any other
account where money is or may be deposited or maintained with any Person, other
than the Disbursement Account, the Depositary Accounts, the Concentration
Account and the accounts set forth on Schedule B, Part 8.12.
8.13 Amendments of Material Contracts.
--------------------------------
(a) No Borrower shall, or shall permit any of its Subsidiaries to,
directly or indirectly, without the prior written consent of the Agent, amend,
modify, cancel or terminate or permit the amendment, modification, cancellation
or termination of, any of the Subordinated Note Documents or Acquisition
Documents, respectively.
(b) No Borrower shall, or shall permit any of its Subsidiaries to,
directly or indirectly, without the prior written consent of the Agent, amend,
modify, cancel or terminate or permit the amendment, modification, cancellation
or termination of, any of the other Material Contracts (in the case of
amendments or modifications, other than as a result of periodic price
adjustments and other negotiated changes which are made on commercially
reasonable terms and in accordance with such Borrower's usual and customary
business practices in effect on the Closing Date).
8.14 Additional Restrictive Covenants. No Borrower shall, or shall permit
--------------------------------
any of its Subsidiaries to, directly or indirectly, create or otherwise cause or
suffer to exist or become effective (a) any consensual restriction limiting the
ability (whether by covenant, event of default, subordination or otherwise and
including any such the effect of which is to require the providing of equal and
ratable security to any other Person in the event a Lien is granted to or for
the benefit of the Agent and the Lenders) to (i) pay dividends or make any other
distributions on shares of its Capital Securities held by any Borrower or any
other Subsidiary of any Borrower; (ii) pay any Liability owed to any Borrower or
any other Subsidiary of any Borrower; (iii) make any loans or advances to other
Investments in any Borrower or in any other Subsidiary of any other Borrower; or
(iv) create or permit to exist any Lien upon the assets of any Borrower or any
Subsidiary of any Borrower, other than Liens permitted under Section 8.4; or (b)
any contractual obligation which may restrict or inhibit the Agent's rights or
ability to sell or otherwise dispose of the Collateral or any part thereof after
the occurrence of an Event of Default; other than Permitted Restrictive
Covenants.
8.15 No Additional Subsidiaries. No Borrower shall, or shall permit any
--------------------------
of its Subsidiaries to, directly or indirectly, form or acquire any new
Subsidiaries, provided, that, in connection with the consummation of an
Acquisition permitted pursuant to Section 8.8(f), a Borrower shall be permitted
to establish or create wholly-owned corporate Subsidiaries, prior to or
concurrently with the consummation of such Acquisition, (a) such Subsidiary
shall be joined as a party to this Credit Agreement, the Borrower Security
Agreement and all other applicable
-71-
Credit Documents and shall have taken such further actions and executed such
additional documents and instruments as the Agent may reasonably determine to be
necessary or desirable to further carry out and consummate the provisions
contemplated by the Credit Documents with respect to such Subsidiary, including,
without limitation, the granting to the Agent for the benefit of the Agent and
Lenders of an enforceable, first, prior (subject to Permitted Liens) and
perfected Lien on substantially all properties and assets of such Subsidiary and
(b) the Agent shall have been granted for the benefit of the Agent and Lenders
an enforceable, first, prior (subject to Permitted Liens) and perfected Lien on
all Capital Securities of any kind of therein and shall have received duly
executed copies of all instruments and documents as Agent may reasonably deem
necessary or desirable in connection therewith, including, without limitation,
UCC financing statements.
8.16 Limitation on Derivative Transactions. No Borrower shall, or shall
-------------------------------------
permit any of its Subsidiaries to, enter into any Derivative Transaction.
ARTICLE 9
EVENTS OF DEFAULT AND REMEDIES
------------------------------
9.1 Events of Default. The occurrence of any of the following events
-----------------
shall constitute an Event of Default hereunder (whatever the reason for such
event and whether it shall be voluntary or involuntary, or within or without the
control of any Borrower, any Subsidiary of any Borrower or any other Credit
Party, or be effected by operation of law or pursuant to any judgment or order
of any court or any order, rule or regulation of any governmental or
nongovernmental body):
(a) failure of the Borrowers to pay (i) any interest, Fees, Expenses or
other Obligations (other than an Obligation referred to in clause (ii)) when
due, whether at stated maturity, by acceleration, or otherwise, or (ii) when
due, whether at stated maturity, by acceleration or otherwise any (A) principal
of any Loan or (B) reimbursement obligation with respect to any Letter of
Credit; or
(b) failure of any Borrower or any Subsidiary of any Borrower to perform,
comply with or observe any term, covenant or agreement applicable to it
contained in Article 7 (other than Sections 7.9, 7.12 and 7.15) or Article 8; or
(c) (i) any representation or warranty made by any Borrower, any
Subsidiary of any Borrower or any other Credit Party under this Credit Agreement
or under any other Credit Document shall prove to have been incorrect or
misleading in any material respect when made or deemed made; or
(ii) any Borrower, any Subsidiary of any Borrower or any other Credit
Party shall fail to comply with any covenant contained in this Credit Agreement
(other than under a provision covered by Section 9.1(a) or (b) above) or the
other Credit Documents (other than a provision covered under Section
9.1(a)(ii)(B) above), which failure to comply is not cured within ten (10)
Business Days of its occurrence; or
-72-
(d) dissolution, liquidation, winding up or cessation of any Credit
Party's businesses, or the failure of any Credit Party to meet its debts as they
mature, or the calling of one or more meetings of any Credit Party's major
creditors for purposes of obtaining a moratorium on payment or a compromise of
such Credit Party's debts; or
(e) (i) the insolvency (however defined) of any Credit Party; or
(ii) the commencement by or against any Credit Party of any
bankruptcy, insolvency, arrangement, reorganization, receivership or similar
proceedings under any federal or state law and, in the event any such proceeding
is commenced against any Credit Party, such proceeding is not dismissed within
sixty (60) days; or
(f) the occurrence of a Change of Control; or
(g) (i) the occurrence of an Event of Default (as such term is defined in
the Subordinated Note Indenture); or
(ii) occurrence of a default or event of default (in each case which
shall continue beyond the expiration of any applicable grace periods) which
permits, or could permit, the acceleration of the maturity of any note,
agreement or instrument evidencing any other Indebtedness of any Borrower or any
Subsidiary of any Borrower, and the aggregate principal amount of all such
Indebtedness with respect to which a default or an event of default has
occurred, or the maturity of which is permitted to be accelerated, exceeds
$250,000; or
(h) any covenant, agreement or obligation of any party contained in or
evidenced by any of the Credit Documents shall cease to be enforceable in
accordance with its terms, or any party (other than the Agent or the Lenders, in
its capacity as such, and not in its capacity as an Issuing Lender) to any
Credit Document shall deny or disaffirm its obligations under any of the Credit
Documents, or any Credit Document shall be cancelled, terminated, revoked or
rescinded without the express prior written consent of the Agent, or any action
or proceeding shall have been commenced by any Person (other than the Agent or a
Lender, in its capacity as such, and not in its capacity as an Issuing Lender)
seeking to cancel, revoke, rescind or disaffirm the obligations of any party to
any Credit Document, or any court or other Governmental Authority shall issue a
judgment, order, decree or ruling to the effect that any of the obligations of
any party to any Credit Document are illegal, invalid or unenforceable; or
(i) (i) any Termination Event shall occur with respect to any Benefit
Plan of any Borrower, any Subsidiary of any Borrower or any ERISA Affiliate,
(ii) any Accumulated Funding Deficiency, whether or not waived, shall exist with
respect to any such Benefit Plan, (iii) any Person shall engage in any
Prohibited Transaction involving any such Benefit Plan, (iv) any Borrower, any
Subsidiary of any Borrower or any ERISA Affiliate shall be in "default" (as
defined in ERISA Section 4219(c)(5)) with respect to payments owing to any such
Benefit Plan that is a Multiemployer Plan as a result of such Person's complete
or partial withdrawal (as described in ERISA Section 4203 or 4205) therefrom,
(v) any Borrower, any Subsidiary of any Borrower or any ERISA Affiliate shall
fail to pay when due an amount that is payable by it to the PBGC or to any such
Benefit Plan under Title IV of ERISA, (vi) a proceeding shall be instituted by a
fiduciary of any such Benefit Plan against any Borrower, any Subsidiary of any
Borrower or
-73-
any ERISA Affiliate to enforce ERISA Section 515 and such proceeding shall not
have been dismissed within 30 days thereafter or (vii) any other event or
condition shall occur or exist with respect to any such Benefit Plan, except
that no event of default or non-compliance with law referred to in clauses (i)
through (vii) shall constitute an Event of Default if it, together with all
other such events or conditions at the time existing, has not subjected, and in
the reasonable determination of the Majority Lenders will not subject, any
Borrower or any Subsidiary of any Borrower to any liability that, alone or in
the aggregate with all such liabilities for all such Persons, exceeds $250,000;
or
(j) Parent engages in any type of business activity other than the
ownership of the Capital Securities of the respective Borrowers and the
performance of its obligations under the Credit Documents.
9.2 Acceleration and Cash Collateralization. Upon the occurrence of an
---------------------------------------
Event of Default and which is continuing, the Agent shall, upon the request of
the Majority Lenders, and by delivery of notice to the Funds Administrator from
the Agent, take any or all of the following actions, without prejudice to the
rights of the Agent, any Lender or the holder of any Note to enforce its claims
against any Borrower: (a) declare all Obligations to be immediately due and
payable (except with respect to any Event of Default set forth in Section
9.1(e), in which case all Obligations shall automatically become immediately due
and payable without the necessity of any notice or other demand) without
presentment, demand, protest or any other action or obligation of the Agent or
any Lender; and (b) immediately terminate the Commitments hereunder.
In addition, upon demand by the Agent or the Majority Lenders upon the
occurrence of any Event of Default and which is continuing, the Borrowers shall
deposit with the Agent with cash or Cash Equivalents in an amount equal to 110%
of the Letter of Credit Outstandings (in each case to the extent the same are
such by virtue of clause (a) of the definition thereof). Such deposit shall be
held by the Agent as security for, and to provide for the payment of, Letter of
Credit Outstandings.
If at any time after acceleration of the maturity of the Obligations, the
Borrowers shall pay all arrears of interest and all payments on account of
principal of the Loans which shall have become due otherwise than by
acceleration (with interest on principal and, to the extent permitted by law, on
overdue interest, at the rates specified in Section 4.4) and all Events of
Default and Defaults (other than nonpayment of principal of and accrued interest
on the Loans and other Obligations due and payable solely by virtue of
acceleration) shall be remedied or waived, then by written notice to the Funds
Administrator, the Majority Lenders may elect, in the sole discretion of such
Majority Lenders, to rescind and annul the acceleration and its consequences and
return any cash collateral; but such action shall not affect any subsequent
Default or Event of Default or impair any right or remedy consequent thereon.
The provisions of the preceding sentence are intended merely to bind the Lenders
to a decision which may be made at the election of the Majority Lenders; they
are not intended to benefit the Borrowers and do not give any Borrower the right
to require the Lenders to rescind or annul any acceleration hereunder or to
return any cash collateral, even if the conditions set forth herein are met.
-74-
9.3 Remedies. From and after the occurrence of any Event of Default and
--------
which is continuing, the Agent may: (a) remove from any premises where same may
be located any and all documents, instruments, files and records (including the
copying of any computer records), and any receptacles or cabinets containing
same, relating to any or all of the Collateral, or the Agent may use (at the
expense of the Borrowers) such of the supplies or space of any Borrower at any
Borrower's place of business or otherwise, as may be necessary to properly
administer and control any or all of the Collateral or the handling of
collections and realizations thereon; (b) bring suit, in the name of a Borrower
or the Lenders and generally shall have all other rights respecting any or all
of the Collateral, including the right to: accelerate or extend the time of
payment, settle, compromise, release in whole or in part any amounts owing on
any or all of the Collateral and issue credits in the name of a Borrower or the
Lenders; and (c) foreclose the security interests created pursuant to the Credit
Documents by any available judicial procedure, or to take possession of any or
all of the Collateral without judicial process and enter any premises where any
Collateral may be located for the purpose of taking possession of or removing
same. The Agent shall have the right, without notice or advertisement, to sell,
lease, or otherwise dispose of all or any part of the Collateral, whether in its
then condition or after further preparation or processing, in the name of a
Borrower or the Lenders, or in the name of such other party as the Agent may
designate, either at public or private sale or at any broker's board, in lots or
in bulk, for cash or for credit, with or without warranties or representations,
and upon such other terms and conditions as the Agent in its sole discretion may
deem advisable, and the Agent or any other Lender shall have the right to
purchase at any such sale. If any Collateral shall require rebuilding,
repairing, maintenance or preparation, the Agent shall have the right, at its
option, to do such of the aforesaid as is necessary, for the purpose of putting
such Collateral in such saleable form as the Agent shall deem appropriate. Each
Borrower agrees, at the request of the Agent, to assemble the Collateral and to
make it available to the Agent at places which the Agent shall select, whether
at the premises of such or any other Borrower or elsewhere, and to make
available to the Agent the premises and facilities of such Borrower for the
purpose of the Agent's taking possession of, removing or putting the Collateral
in saleable form. However, if notice of intended disposition of any Collateral
is required by law, it is agreed that five (5) Business Days notice shall
constitute reasonable notification. Unless expressly prohibited by the licensor
thereof, if any, the Agent is hereby granted a license to use all computer
software programs, data bases, processes and materials used by each Borrower in
connection with its businesses or in connection with the Collateral. The net
cash proceeds resulting from the Agent's exercise of any of the foregoing rights
(after deducting all charges, costs and expenses, including reasonable
attorneys' fees) shall be applied by the Agent to the payment of the
Obligations, whether due or to become due, in such order as the Agent may elect,
and pending such payment shall be held as security for such payment. Each
Borrower shall remain liable to the Agent and the Lenders for any deficiencies.
The enumeration of the foregoing rights is not intended to be exhaustive and the
exercise of any right shall not preclude the exercise of any other rights, all
of which shall be cumulative.
-75-
ARTICLE 10
THE AGENT
---------
10.1 Appointment of Agent.
--------------------
(a) Each Lender hereby designates BTCo as its contractual representative
to act as herein specified. Each Lender hereby irrevocably authorizes, and each
holder of a Note or a participation interest in a Letter of Credit by the
acceptance of such Note or participation interest shall be deemed irrevocably to
authorize, the Agent to take such action on its behalf under the provisions of
this Credit Agreement, the other Credit Documents and any other instruments and
agreements referred to herein or therein and to exercise such powers and to
perform such duties hereunder and thereunder as are specifically delegated to or
required of the Agent by the terms hereof and thereof and such other powers as
are reasonably incidental thereto. The Agent shall hold all Collateral and all
payments of principal, interest, Fees, charges and Expenses received pursuant to
this Credit Agreement or any other Credit Document for the benefit of the
Lenders and the Issuing Lenders to be distributed as provided herein. The Agent
may perform any of its duties hereunder by or through its agents or employees.
(b) The provisions of this Article 10 are solely for the benefit of the
Agent, the Lenders and the Issuing Lenders, and none of the Credit Parties shall
have any rights as a third party beneficiary of any of the provisions hereof
(other than Section 10.9). In performing its functions and duties under this
Credit Agreement, the Agent shall act solely as agent of the Lenders and the
Issuing Lenders and does not assume and shall not be deemed to have assumed any
obligation toward or relationship of agency or trust with or for any Credit
Party.
10.2 Nature of Duties of Agent. The Agent shall have no duties or
-------------------------
responsibilities except those expressly set forth in this Credit Agreement and
the other Credit Documents. Neither the Agent nor any of its officers,
directors, employees or agents shall be liable for any action taken or omitted
by it as such hereunder or in connection herewith, unless caused by its or their
gross negligence or willful misconduct. The duties of the Agent shall be
mechanical and administrative in nature; the Agent shall not have by reason of
this Credit Agreement or the other Credit Documents a fiduciary relationship in
respect of any Lender or any Issuing Lender, and nothing in this Credit
Agreement or the other Credit Documents, expressed or implied, is intended to or
shall be so construed as to impose upon the Agent any obligations in respect of
this Credit Agreement or the other Credit Documents except as expressly set
forth herein or therein.
10.3 Lack of Reliance on the Agent.
-----------------------------
(a) Independently and without reliance upon the Agent, any Lender or any
Issuing Lender, to the extent it deems appropriate, has made and shall continue
to make (i) its own independent investigation of the financial or other
condition and affairs of each Credit Party in connection with the taking or not
taking of any action in connection herewith and (ii) its own appraisal of (A)
the creditworthiness of each Credit Party, and (B) the Collateral, and, except
as expressly provided in this Credit Agreement, the Agent shall have no duty or
responsibility, either initially or on a continuing basis, to provide any Lender
or any Issuing Lender with any
-76-
credit or other information with respect thereto, whether coming into its
possession before the initial Credit Event or at any time or times thereafter.
(b) The Agent shall not be responsible to any Lender or Issuing Lender
for any recitals, statements, information, representations or warranties herein
or in any other Credit Document or for the execution, effectiveness,
genuineness, validity, enforceability, collectibility, priority or sufficiency
of this Credit Agreement or any other Credit Document or the financial or other
condition of any Credit Party. The Agent shall not be required to make any
inquiry concerning either the performance or observance, of any of the terms,
provisions or conditions of this Credit Agreement or any other Credit Document,
or the financial condition of any Credit Party, or the existence or possible
existence of any Default or Event of Default, unless specifically requested to
do so in writing by any Lender or Issuing Lender, as the case may be.
10.4 Certain Rights of the Agent. The Agent shall have the right to
---------------------------
request instructions from the Lenders at any time. If the Agent shall request
instructions from the Lenders with respect to any act or action (including the
failure to act) in connection with this Credit Agreement, the Agent shall be
entitled to refrain from such act or taking such action unless and until the
Agent shall have received instructions from the Majority Lenders (or, to the
extent required pursuant to Section 11.10, the Super Majority Lenders or all
Lenders), and the Agent shall not incur liability to any Person by reason of so
refraining. Without limiting the foregoing, no Lender or Issuing Lender shall
have any right of action whatsoever against the Agent as a result of the Agent
acting or refraining from acting hereunder in accordance with the instructions
of the Majority Lenders.
10.5 Reliance by the Agent. The Agent shall be entitled to rely, and
---------------------
shall be fully protected in relying, upon any note, writing, resolution, notice,
statement, certificate, telex or facsimile transmission, E-mail, telecopier
message, cablegram, order or other documentary, teletransmission or telephone
message believed by it to be genuine and correct and to have been signed, sent
or made by the proper Person. The Agent may consult with legal counsel
(including counsel for the Borrowers with respect to matters concerning the
Borrowers), independent public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken by it in good
faith in accordance with the advice of such counsel, accountants or experts.
The Agent may, but shall not be required to, rely on Borrowing Base Certificates
and any other schedules or reports delivered to the Agent in connection herewith
in determining the amount of the Borrowing Base and the then eligibility of
Accounts and Inventory of the respective Borrowers. Reliance thereon by the
Agent from time to time shall not be deemed to limit the right of the Agent to
revise advance rates or standards of eligibility as provided in the definition
of the term "Borrowing Base" set forth herein.
10.6 Indemnification of Agent. To the extent the Agent is not reimbursed
------------------------
and indemnified by the Borrowers, each Lender will reimburse and indemnify the
Agent, in proportion to its respective Commitment, for and against any and all
Liabilities, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including counsel fees and disbursements) or disbursements of any kind
or nature whatsoever (including all Expenses) which may be imposed on, incurred
by or asserted against the Agent, in any way relating to or arising out of this
Credit Agreement or any other Credit Document; provided that no Lender, shall be
liable for any portion of such Liabilities, losses, damages, penalties, actions,
judgments, suits, costs,
-77-
expenses or disbursements to the extent it is determined by a judgment of a
court that is binding on the Agent, final and not subject to review on appeal,
to be the result of acts or omissions on the part of the Agent, constituting
gross negligence or willful misconduct.
10.7 The Agent in its Individual Capacity. With respect to its
------------------------------------
obligation to lend under this Credit Agreement, the Loans made by it and the
Notes issued to it, and its participation in Letters of Credit, the Agent shall
have the same rights and powers hereunder as any other Lender or holder of a
Note or participation interests and may exercise the same as though it was not
performing the duties specified herein; and the terms "Lenders," "Majority
Lenders," "Super Majority Lenders," "holders of Notes," or any similar terms
shall, unless the context clearly otherwise indicates, include the Agent in its
individual capacity. The Agent may accept deposits from, lend money to, acquire
equity interests in, and generally engage in any kind of banking, trust,
financial advisory or other business with any Borrower or any Affiliate of any
Borrower as if it were not performing the duties specified herein, and may
accept fees and other consideration from any Borrower for services in connection
with this Credit Agreement and otherwise without having to account for the same
to the Lenders or any Issuing Lender.
10.8 Holders of Notes.
----------------
(a) The Agent may deem and treat the payee of any Note as the owner
thereof for all purposes hereof unless and until a written notice of the
assignment or transfer thereof shall have been filed with the Agent. Any
request, authority or consent of any Person who, at the time of making such
request or giving such authority or consent, is the holder of any Note, shall be
conclusive and binding on any subsequent holder, transferee or assignee of such
Note or of any Note or Notes issued in exchange therefor.
10.9 Successor Agent.
---------------
(a) The Agent may, upon five (5) Business Days' notice to the Lenders and
the Funds Administrator, resign at any time (effective upon the appointment of a
successor Agent pursuant to the provisions of this Section 10.9) by giving
written notice thereof to the Lenders and the Funds Administrator. Upon such
resignation, the Majority Lenders shall have the right, upon five (5) days'
notice to the Funds Administrator (and with the consent of the Borrowers, which
consent shall not be unreasonably withheld or delayed), to appoint a successor
Agent. If no successor Agent (i) shall have been so appointed by the Majority
Lenders and (ii) shall have accepted such appointment, within thirty (30) days
after the retiring Agent's giving of notice of resignation, then, upon five (5)
days' notice, the retiring Agent may, on behalf of the Lenders, appoint a
successor Agent.
(b) Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations under
this Credit Agreement. After any retiring Agent's resignation hereunder as
Agent, the provisions of this Article 10 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under this Credit
Agreement.
-78-
(c) In the event of a material breach by the Agent of its duties
hereunder, the Agent may be removed by the Majority Lenders for cause and the
provisions of this Section 10.9 shall apply to the appointment of a successor
Agent. Such removal of the Agent shall also operate, if at the time any such
Person is serving as such, as a removal of BTCo and each of its Serving
Affiliates, if any, as an Issuing Lender, subject to Section 10.9(d).
(d) No removal of BTCo, Deutsche Bank AG or any of its Serving Affiliates
pursuant to Section 10.9(c), as an Issuing Lender, shall be effective unless its
Liabilities under each Letter of Credit are secured with cash or by letters of
credit in form and substance, and issued by issuers, satisfactory to BTCo,
Deutsche Bank AG or such Serving Affiliate.
10.10 Collateral Matters.
------------------
(a) Each Lender and each Issuing Lender authorizes and directs the Agent
to enter into the Collateral Documents for the benefit of such Person. Each
Lender and each Issuing Lender hereby agrees, and each holder of any Note by the
acceptance thereof will be deemed to agree, that, except as otherwise set forth
in Section 11.10, any action taken by the Majority Lenders or the Super Majority
Lenders, as the case may be, in accordance with the provisions of this Credit
Agreement or the Collateral Documents, and the exercise by the Majority Lenders
or Super Majority Lenders of the powers set forth herein or therein, together
with such other powers as are reasonably incidental thereto, shall be authorized
and binding upon all of the Lenders and all the Issuing Lenders. The Agent is
hereby authorized on behalf of all of the Lenders and all the Issuing Lenders,
without the necessity of any notice to or further consent from any Lender or any
Issuing Lender from time to time prior to, an Event of Default, to take any
action with respect to any Collateral or Collateral Documents which may be
necessary to perfect and maintain perfected the Liens upon the Collateral
granted pursuant to the Collateral Documents.
(b) Each Lender and each Issuing Lender hereby authorizes the Agent, at
its option and in its discretion, to release any Lien granted to or held by the
Agent upon any Collateral (i) upon termination of the Commitments and payment
and satisfaction of all of the Obligations at any time arising under or in
respect of this Credit Agreement or the other Credit Documents or the
transactions contemplated hereby or thereby, (ii) constituting property being
sold or disposed of upon receipt of the proceeds of such sale by the Agent, if
the Funds Administrator certifies to the Agent that such sale or disposition is
made in compliance with Section 8.5 (and the Agent may rely conclusively on any
such certificate, without further inquiry) or (iii) if approved, authorized or
ratified in writing by the Majority Lenders, unless such release is required to
be approved by all of the Lenders pursuant to Section 11.10. Upon request by the
Agent at any time, each Lender and each Issuing Lender will confirm in writing
the Agent's authority to release particular types or items of Collateral
pursuant to this Section 10.10.
(c) Upon any sale and transfer of Collateral which is expressly permitted
pursuant to the terms of this Credit Agreement, or consented to in writing by
the Majority Lenders (or all Lenders, if such release is required to be approved
by all of the Lenders pursuant to Section 11.10), and upon at least five (5)
Business Days' prior written request by the Funds Administrator, the Agent shall
(and is hereby irrevocably authorized by each Lender and each Issuing Lender,
to) execute such documents as may be necessary to evidence the release of the
Liens granted to the Agent for the benefit of the Agent, the Lenders and the
Issuing Lenders
-79-
herein or pursuant hereto upon the Collateral that was sold or transferred;
provided that (i) the Agent shall not be required to execute any such document
on terms which, in the Agent's opinion, would expose the Agent to or create any
Liability or entail any consequence other than the release of such Liens without
recourse or warranty and (ii) such release shall not in any manner discharge,
affect or impair the Obligations or any Liens upon (or obligations of any
Borrower or any Credit Party in respect of) all interests retained by any
Borrower or any Credit Party, including the proceeds of the sale, all of which
shall continue to constitute part of the Collateral. In the event of any sale or
transfer of Collateral, or any foreclosure with respect to any of the
Collateral, the Agent shall be authorized to deduct all of the Expenses
reasonably incurred by the Agent from the proceeds of any such sale, transfer or
foreclosure.
(d) The Agent shall have no obligation whatsoever to any Lender, any
Issuing Lender or any other Person to assure that the Collateral exists or is
owned by any Borrower or any Subsidiary thereof or is cared for, protected or
insured or that the Liens granted to the Agent herein or in any of the
Collateral Documents or pursuant hereto or thereto have been properly or
sufficiently or lawfully created, perfected, protected or enforced or are
entitled to any particular priority, or to exercise or to continue exercising at
all or in any manner or under any duty of care, disclosure or fidelity any of
the rights, authorities and powers granted or available to the Agent in this
Section 10.10 or in any of the Collateral Documents, it being understood and
agreed that in respect of the Collateral, or any act, omission or event related
thereto, the Agent may act in any manner it may deem appropriate, in its sole
discretion, given the Agent's own interest in the Collateral as one of the
Lenders and that the Agent shall have no duty or liability whatsoever to the
Lenders, except for its gross negligence or willful misconduct.
10.11 Actions with Respect to Defaults. In addition to the Agent's right
--------------------------------
to take actions on its own accord as permitted under this Credit Agreement, the
Agent shall take such action with respect to a Default or Event of Default as
shall be directed by the Majority Lenders; provided that until the Agent shall
have received such directions, the Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable and in the best interests
of the Lenders and the Issuing Lenders; and, further, provided that the Agent
shall not be required under any circumstances to take any action that, in its
judgment, (a) is contrary to any provision of the Credit Documents or applicable
law or (b) will expose it to any liability or expense against which it has not
been indemnified to its satisfaction.
10.12 Delivery of Information. The Agent shall not be required to deliver
-----------------------
to any Lender or any Issuing Lender originals or copies of any documents,
instruments, notices, communications or other information received by the Agent
from the Funds Administrator, any Borrower, any Subsidiary of any Borrower, the
Majority Lenders, any Lender, any Issuing Lender or any other Person under or in
connection with this Credit Agreement or any other Credit Document except (a) as
specifically provided in this Credit Agreement or any other Credit Document and
(b) as specifically requested from time to time in writing by any Lender, or any
Issuing Lender with respect to a specific document, instrument, notice or other
written communication received by and in the possession of the Agent at the time
of receipt of such request and then only in accordance with such specific
request.
-80-
ARTICLE 11
MISCELLANEOUS
-------------
11.1 SUBMISSION TO JURISDICTION; WAIVERS. EACH CREDIT PARTY HEREBY
-----------------------------------
IRREVOCABLY AND UNCONDITIONALLY:
(a) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING
RELATING TO THIS CREDIT AGREEMENT AND THE OTHER CREDIT DOCUMENTS TO WHICH IT IS
A PARTY, OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF,
TO THE NONEXCLUSIVE GENERAL JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK,
THE COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW
YORK, IN EACH CASE LOCATED IN NEW YORK, NEW YORK, AND APPELLATE COURTS FROM ANY
THEREOF;
(b) CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH
COURTS AND WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE
OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR
PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO PLEAD OR CLAIM
THE SAME;
(c) AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING MAY
BE EFFECTED BY MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR ANY
SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID, TO SUCH CREDIT PARTY AT
THE ADDRESS OF SUCH CREDIT PARTY SET FORTH IN SECTION 11.5 OR AT SUCH OTHER
ADDRESS OF WHICH THE AGENT SHALL HAVE BEEN NOTIFIED PURSUANT THERETO;
(d) AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE AGENT OR ANY
LENDER TO EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
AFFECT THE RIGHT OF THE AGENT OR ANY LENDER TO BRING ANY ACTION OR PROCEEDING
AGAINST ANY BORROWER, OR ITS PROPERTY IN THE COURTS OF OTHER JURISDICTIONS; AND
(e) WAIVES DUE DILIGENCE, DEMAND, PRESENTMENT AND PROTEST AND ANY NOTICES
THEREOF AS WELL AS NOTICE OF NONPAYMENT.
11.2 JURY TRIAL. THE CREDIT PARTIES, THE AGENT, EACH ISSUING LENDER AND
----------
THE LENDERS EACH HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING ARISING OUT OF THIS CREDIT AGREEMENT, THE OTHER CREDIT DOCUMENTS OR
ANY OTHER AGREEMENTS OR TRANSACTIONS RELATED HERETO OR THERETO.
-81-
11.3 GOVERNING LAW. THE RIGHTS AND DUTIES OF THE CREDIT PARTIES, THE
-------------
AGENT, EACH ISSUING LENDER AND THE LENDERS UNDER THIS CREDIT AGREEMENT, THE
NOTES (INCLUDING MATTERS RELATING TO THE MAXIMUM PERMISSIBLE RATE) AND THE OTHER
CREDIT DOCUMENTS SHALL, PURSUANT TO NEW YORK GENERAL OBLIGATIONS LAW XXXXXXX 0-
0000, XX GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO CONFLICT OF LAW PRINCIPLES.
11.4 Delays; Partial Exercise of Remedies. No delay or omission of the
------------------------------------
Agent, any Issuing Lender or any Lender to exercise any right or remedy
hereunder or under any of the other Credit Documents, whether before or after
the happening of any Event of Default, shall impair any such right or shall
operate as a waiver thereof or as a waiver of any such Event of Default. No
single or partial exercise by the Agent, any Issuing Lender or any Lender of any
right or remedy shall preclude any other or further exercise thereof, or
preclude any other right or remedy.
11.5 Notices. Except as otherwise provided herein, all notices and
-------
correspondence hereunder shall be in writing and sent by certified or registered
mail, return receipt requested, or by overnight delivery service, with all
charges prepaid, to the following addresses, if to the Agent, or any of the
Lenders, then to Bankers Trust Company, 000 Xxxxx Xxxxxx Xxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxxxxx 00000, Attention: Credit Department, if to any Issuing Lender,
to the address specified in the applicable Letter of Credit Request, and if to
the Funds Administrator or any Borrower, then to such Person at 0000 Xxxxxxx
Xxxxx, Xxxxx 000, Xxxxxxx, XX 00000, Attention: Treasurer, with a copy to
Xxxxxx, Xxxxxxx & Xxxxxx, LLP, 1600 Atlanta Financial Center, 0000 Xxxxxxxxx
Xxxx, X.X., Xxxxxxx, XX 00000, Attention: Xxxxxxx X. Xxxxxxx, Esq., or by
facsimile transmission, promptly confirmed in writing sent by first class mail,
if to the Agent, or any of the Lenders, at (312) 993- 8139, if to an Issuing
Lender, as specified in the applicable Letter of Credit Request, and if to the
Funds Administrator or any Borrower at (000) 000-0000, with a copy to (404) 365-
9532. All such notices and correspondence shall be deemed given (a) if sent by
certified or registered mail, three (3) Business Days after being postmarked,
(b) if sent by overnight delivery service, when received at the above stated
addresses or when delivery is refused and (c) if sent by facsimile transmission,
when receipt of such transmission is acknowledged except, in the case of a
notice from the Agent to the Funds Administrator under Section 9.2, such notice
shall be deemed given when sent by facsimile transmission (with receipt thereof
electronically confirmed).
11.6 Assignability.
-------------
(a) The Borrowers shall not have the right to assign this Credit Agreement
or any interest therein except with the prior written consent of the Agent.
(b) Any Lender may make, carry or transfer Loans at, to or for the account
of, any of its branch offices or the office of an Affiliate of such Lender
except to the extent such transfer would result in increased costs to the
Borrowers.
(c) Each Lender may assign to one or more banks, other financial
institutions or investment funds all or a portion of its rights and obligations
under this Credit Agreement, the
-82-
Notes and the other Credit Documents; provided that, except in the case of an
assignment to a Federal Reserve Bank (which may be made without condition or
restriction), (i) such assignment shall be for a fixed and not varying
percentage of the assigning Lender's Loans, participation interests in Letters
of Credit and Commitment, (ii) the Agent shall consent to, and the Funds
Administrator shall receive notice of, such assignment, (iii) for each such
assignment, the parties thereto shall execute and deliver to the Agent, for its
acceptance and recording in the Register (as defined below), an Assignment and
Assumption Agreement, together with any Note or Notes subject to such assignment
and a processing and recordation fee of $5,000 and (iv) except for any
assignment covering all or the remaining portion of an assigning Lender's rights
and obligations under this Credit Agreement, the Notes and the other Credit
Documents, no such assignment shall be for less than $10,000,000 of the
assigning Lender's Commitment, unless such assignment is to a then-current
holder of a Note. Upon such execution and delivery of the Assignment and
Assumption Agreement to the Agent, from and after the date specified as the
effective date in the Assignment and Assumption Agreement (the "Acceptance
Date"), (A) the assignee thereunder shall be a party hereto, and, to the extent
that rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Assumption Agreement, such assignee shall have the rights and
obligations of a Lender hereunder and (B) the assignor thereunder shall, to the
extent that rights and obligations hereunder have been assigned by it pursuant
to such Assignment and Assumption Agreement, relinquish its rights (other than
any rights it may have pursuant to Section 11.8, which rights will survive) and
be released from its obligations (other than any obligations it may have
pursuant to Section 11.7, which obligations will survive under this Credit
Agreement (and, in the case of an Assignment and Assumption Agreement covering
all or the remaining portion of an assigning Lender's rights and obligations
under this Credit Agreement, such Lender shall cease to be a party hereto).
(d) By executing and delivering an Assignment and Assumption Agreement,
the assignee thereunder confirms and agrees as follows: (i) other than as
provided in such Assignment and Assumption Agreement, the assigning Lender makes
no representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Credit Agreement or any other Credit Document or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Credit
Agreement, the Notes, or any other Credit Document; (ii) such assigning Lender
makes no representation or warranty and assumes no responsibility with respect
to the financial condition of any Borrower, any other Credit Parties or any
Issuing Lender, the value of the Collateral, or the performance or observance by
(A) any Borrower or any other Credit Parties of any of its obligations under
this Credit Agreement or any other Credit Document, or (B) any Issuing Lender of
any of its obligations in respect of any Letter of Credit; (iii) such assignee
confirms that it has received a copy of this Credit Agreement, together with
copies of the Financial Statements referred to in Section 7.1 and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Assumption Agreement;
(iv) such assignee will continue, independently and without reliance upon the
Agent, such assigning Lender or any other Lender and based on such documents and
information as it shall deem appropriate at the time, to make its own credit
decisions in taking or not taking action under this Credit Agreement; (v) such
assignee appoints and authorizes the Agent to take such action as agent on its
behalf and to exercise such powers under this Credit Agreement and the other
Credit Documents as are delegated to the Agent by
-83-
their terms, together with such powers as are reasonably incidental thereto; and
(vi) such assignee agrees that it will perform in accordance with their terms
all of the obligations which by the terms of this Credit Agreement are required
to be performed by it as a Lender.
(e) The Agent shall maintain at its address referred to in Section 11.5 a
copy of each Assignment and Assumption Agreement delivered to and accepted by it
and a register for the recordation of the names and addresses of the Lenders and
the Commitment of, and principal amount of the Loans owing to, each Lender from
time to time (the "Register"). The entries in the Register shall be conclusive
and binding for all purposes, absent manifest error, and the Funds
Administrator, each of the Borrowers, the Agent and the Lenders may treat each
Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Credit Agreement. The Register and copies of each Assignment
and Assumption shall be available for inspection by any Borrower or any Lender
at any reasonable time and from time to time upon reasonable prior notice.
(f) Upon its receipt of an Assignment and Assumption Agreement executed by
an assigning Lender, together with the Note or Notes subject to such assignment,
the Agent shall, if such Assignment and Assumption Agreement has been completed
and is in substantially the form of Exhibit A hereto, (i) accept such Assignment
and Assumption Agreement, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the Funds Administrator. Within
five (5) Business Days after its receipt of such notice, the Borrowers shall
execute and deliver to the Agent in exchange for the surrendered Note or Notes a
new Note or Notes to the order of the assignee in an amount equal to the
Commitment assumed by it pursuant to such Assignment and Assumption Agreement
and, if the assigning Lender has retained a Commitment hereunder, a new Note or
Notes to the order of the assigning Lender in an amount equal to the Commitment
retained by it hereunder. Such new Note or Notes shall re-evidence the
Indebtedness outstanding under the old Note or Notes and shall be in an
aggregate principal amount equal to the aggregate principal amount of such
surrendered Note or Notes, shall be dated the Closing Date and shall otherwise
be in substantially the form of the Note or Notes subject to such assignments.
(g) Each Lender may sell participations (without the consent of the Agent,
any Borrower or any other Lender) to one or more parties in or to all or a
portion of its rights and obligations under this Credit Agreement (including all
or a portion of its Commitment, the Loans owing to it and the Note or Notes held
by it); provided that (i) such Lender's obligations under this Credit Agreement
(including its Commitment to the Borrowers hereunder) shall remain unchanged,
(ii) such Lender shall remain solely responsible to the other parties hereto for
the performance of such obligations, (iii) such Lender shall remain the holder
of any such Note for all purposes of this Credit Agreement, (iv) the Funds
Administrator, the Borrowers, the Agent, and the other Lenders shall continue to
deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Credit Agreement and such Notes and (v) such
Lender shall not transfer, grant, assign or sell any participation under which
the participant shall have rights to approve any amendment or waiver of this
Credit Agreement except to the extent such amendment or waiver would (A) extend
the final maturity date or the date for the payments of any installment of fees
or principal or interest of any Loans or Letter of Credit reimbursement
obligations in which such participant is participating; (B) reduce the amount of
any installment of principal of the Loans or the amount of any Drawing under any
Letter of
-84-
Credit in which such participant is participating; (C) except as otherwise
expressly provided in this Credit Agreement, reduce the interest rate applicable
to the Loans or the amount of any Drawing under any Letter of Credit in which
such participant is participating; or (D) except as otherwise expressly provided
in this Credit Agreement, reduce any Fees payable hereunder. Each Lender selling
or granting a participation, including a participation sold pursuant to Section
2.10, shall indemnify the Borrowers and the Agent for any Taxes and Liabilities
that either may sustain as a result of such Lender's failure to withhold and pay
any Taxes applicable to payments by such Lender to its participant in respect of
such participation.
(h) Each Lender agrees that, without the prior written consent of the
Borrowers and the Agent, it will not make any assignment hereunder in any manner
or under any circumstances that would require registration or qualification of,
or filings in respect of, any Loan, Note or other Obligation under the
securities laws of the United States of America or of any jurisdiction.
(i) In connection with the efforts of any Lender to assign its rights or
obligations or to participate interests, such Lender may disclose any
information in its possession regarding any Borrower.
11.7 Confidentiality. Each Lender agrees that it will use its reasonable
---------------
best efforts not to disclose without the prior consent of the Borrowers (other
than to its employees, auditors, advisors, Affiliates and counsel, or to another
Lender if the disclosing Lender or such disclosing Lender's holding or parent
company in its sole discretion determines that any such party should have access
to such information) any information with respect to any Borrower or any of its
Subsidiaries, which is furnished pursuant to this Credit Agreement and which is
designated by such Borrower to the Lenders in writing as confidential, provided
that any Lender may disclose any such information (a) as has become generally
available to the public, (b) as may be required or appropriate in any report,
statement or testimony submitted to or examination conducted by any Governmental
Authority having or claiming to have jurisdiction over such Lender, (c) as may
be required or appropriate in response to any summons or subpoena or in
connection with any litigation, (d) in order to comply with any Requirement of
Law, (e) to any prospective or actual transferee or participant in connection
with any contemplated transfer or participation of any of the Notes or
Commitments or any interest therein by such Lender, (f) to other financial
institutions with respect to which the respective Lender has a contractual
relationship in accordance with such Lender's regular banking procedures,
provided that each such other financial institution agrees to be bound by the
confidentiality provisions contained in this Section 11.7, (g) to any nationally
recognized rating agency that requires access to information regarding the
respective Lender's investment portfolio in connection with such rating agency's
issuance of ratings with respect to such Lender, provided that such Lender
advises such rating agency of the confidential nature of such information, (h)
as may be required or appropriate in protecting, preserving, exercising or
enforcing any of its rights in, under or related to the Collateral or the Credit
Documents and (i) as may be required or appropriate in consulting with any
Person with respect to any of the foregoing matters.
11.8 Indemnification. The Borrowers shall and hereby agree jointly and
---------------
severally to indemnify, defend and hold harmless the Agent, each Issuing Lender
and each of the Lenders and their respective directors, officers, agents,
employees, counsel, advisors and Affiliates from and against (a) any and all
losses, claims, damages, liabilities, deficiencies, judgments or
-85-
expenses incurred by any of them (except to the extent that it is finally
judicially determined to have resulted from their own gross negligence or
willful misconduct) arising out of or by reason of any litigations,
investigations, claims or proceedings which arise out of or are in any way
related to (i) this Credit Agreement or the transactions contemplated thereby;
(ii) the issuance of Letters of Credit; (iii) the failure of an Issuing Lender
to honor a Drawing under any Letter of Credit, as a result of any act or
omission, whether rightful or wrongful, of any present or future de jure or de
facto government or Governmental Authority; (iv) any actual or proposed use by
any Borrower of (A) the proceeds of any Loans or (B) any Letter of Credit; or
(v) the Agent's, the Lenders' or any Issuing Lender's entering into this Credit
Agreement, the other Credit Documents or any other agreements and documents
relating thereto, including amounts paid in-settlement, court costs and the fees
and disbursements of counsel incurred in connection with any such litigation,
investigation, claim or proceeding or any advice rendered in connection with any
of the foregoing; and (b) any such losses, claims, damages, liabilities,
deficiencies, judgments or expenses that arise directly or indirectly from or in
connection with any federal, state or local environmental laws, acts, rules,
regulations, orders, directions, ordinances, criteria or guidelines. If and to
the extent that the Obligations of the Borrowers hereunder are unenforceable for
any reason, the Borrowers hereby jointly and severally agree to make the maximum
contribution to the payment and satisfaction of such Obligations which is
permissible under applicable law. The Borrowers' joint and several Obligations
hereunder shall survive any termination of this Credit Agreement and the other
Credit Documents and the payment in full of the Obligations, and are in addition
to, and not in substitution of, any other of its Obligations. In addition, the
Borrowers shall, upon demand, pay to the Agent and each Lender all costs and
expenses (including the reasonable fees and disbursements of counsel and other
professionals) paid or incurred by the Agent or such Lender in (i) enforcing or
defending its rights under or in respect of this Credit Agreement, the other
Credit Documents or any other document or instrument now or hereafter executed
and delivered in connection herewith, (ii) collecting the Loans, (iii)
foreclosing or otherwise collecting upon the Collateral or any part thereof and
(iv) obtaining any legal, accounting or other advice in connection with any of
the foregoing.
11.9 Entire Agreement; Successors and Assigns. This Credit Agreement and
----------------------------------------
the other Credit Documents constitute the entire agreement among the Funds
Administrator, the Borrowers, the Agent and the Lenders (in their capacities as
such and not in their capacity, if any, as an Issuing Lender), supersedes any
prior agreements among them, and shall bind and benefit the Funds Administrator,
the Borrowers, the Agent and the Lenders and their respective successors and
permitted assigns.
11.10 Amendments, Etc. No amendment or waiver of any provision of this
---------------
Credit Agreement or any Collateral Document, nor consent to any departure by any
Credit Party therefrom, shall in any event be effective unless the same shall be
in writing and signed by the Majority Lenders (or by the Agent on their behalf),
or if the Lenders shall not be parties thereto, by the parties thereto and
consented to by the Majority Lenders (or by the Agent on their behalf), and each
such amendment, waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given; provided, that,
notwithstanding the foregoing:
(a) no amendment, waiver or consent shall, unless in writing and signed by
the Super Majority Lenders, (i) increase the advance rates set forth in clauses
(a)(ii), (iii) and (iv) of the definition of the term "Borrowing Base" or (ii)
increase the Fixed Asset Sublimit; and
-86-
(b) no amendment, waiver or consent shall, unless in writing and signed by
all the Lenders, do any of the following: (i) increase the Commitments of the
Lenders or subject the Lenders to any additional obligations; (ii) except as
otherwise expressly provided in this Credit Agreement, reduce the principal of,
or interest on, the Notes or any Drawing under any Letter of Credit or any fees
hereunder; (iii) postpone any date fixed for any payment in respect of principal
of, or interest on, the Notes or any Drawing under any Letter of Credit or any
fees hereunder; (iv) change the percentage of the Commitments, or any minimum
requirement necessary for the Lenders, the Majority Lenders or the Super
Majority Lenders to take any action hereunder; (v) amend or waive this Section
11.10, or change the respective definitions of Majority Lenders or Super
Majority Lenders; or (vi) except in connection with the financing, refinancing,
sale or other disposition of any Collateral of a Borrower permitted under this
Credit Agreement, release Agent's Liens on all or substantially all of the
Collateral and, provided that no amendment, waiver or consent affecting the
rights or duties of the Agent or any Issuing Lender under, (x) in the case of
the Agent, any term or provision of this Credit Agreement and (y) in the case of
any Issuing Lender, (1) Article 3 of this Credit Agreement, (2) any Letter of
Credit or (3) any application in respect of any Letter of Credit, shall in any
event be effective, unless in writing and signed by the Agent or such Issuing
Lender, as applicable, in addition to the Lenders required hereinabove to take
such action.
Notwithstanding any of the foregoing to the contrary, the consent of the
Borrowers shall not be required for any amendment, modification or waiver of the
provisions of Article 10 (other than the provisions of Section 10.9). In
addition, the Borrowers and the Lenders hereby authorize the Agent to modify
this Credit Agreement by unilaterally amending or supplementing Annex II from
time to time in the manner requested by the Borrowers, the Agent or any Lender
in order to reflect any assignments or transfers of the Loans as provided for
hereunder; however, provided that the Agent shall promptly deliver a copy of any
such modification to the Funds Administrator and each Lender.
11.11 Nonliability of Agent and Lenders. The relationship between the
---------------------------------
Borrowers and the Lenders and the Agent shall be solely that of borrower and
lender. Neither the Agent, any Lender or any Issuing Lender shall have any
fiduciary responsibilities to any Credit Party. Neither the Agent, any Lender
or any Issuing Lender undertakes any responsibility to any Credit Party to
review or inform such Credit Party of any matter in connection with any phase of
any other Credit Party's business or operations.
11.12 Counterparts. This Credit Agreement may be executed in any number of
------------
counterparts and by the different parties hereto in separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument.
11.13 Effectiveness. This Credit Agreement shall become effective on the
-------------
date on which all of the parties hereto shall have signed a copy hereof (whether
the same or different copies) and shall have delivered the same to the Agent
pursuant to Section 11.5 or, in the case of the Lenders, shall have given to the
Agent written or facsimile notice (actually received) at such a office that the
same has been signed and mailed to it.
-87-
11.14 Severability. In case any provision in or obligation under this
------------
Credit Agreement or the Notes or the other Credit Documents shall be invalid,
illegal or unenforceable in any jurisdiction, the validity, legality and
enforceability of the remaining provisions or obligations, or of such provision
or obligation in any other jurisdiction, shall not in any way be affected or
impaired thereby.
11.15 Headings Descriptive. The headings of the several sections and
--------------------
subsections of this Credit Agreement, and the Table of Contents, are inserted
for convenience only and shall not in any way affect the meaning or construction
of any provision of this Credit Agreement.
11.16 Maximum Rate. Notwithstanding anything to the contrary contained
------------
elsewhere in this Credit Agreement or in any other Credit Document, the
Borrowers, the Agent and the Lenders hereby agree that all agreements among them
under this Credit Agreement and the other Credit Documents, whether now existing
or hereafter arising and whether written or oral, are expressly limited so that
in no contingency or event whatsoever shall the amount paid, or agreed to be
paid, to the Agent or any Lender for the use, forbearance, or detention of the
money loaned to the Borrowers and evidenced hereby or thereby or for the
performance or payment of any covenant or obligation contained herein or
therein, exceed the Highest Lawful Rate. If due to any circumstance whatsoever,
fulfillment of any provisions of this Credit Agreement or any of the other
Credit Documents at the time performance of such provision shall be due shall
exceed the Highest Lawful Rate, then, automatically, the obligation to be
fulfilled shall be modified or reduced to the extent necessary to limit such
interest to the Highest Lawful Rate, and if from any such circumstance any
Lender should ever receive anything of value deemed interest by applicable law
which would exceed the Highest Lawful Rate, such excessive interest shall be
applied to the reduction of the principal amount then outstanding hereunder or
on account of any other then outstanding Obligations and not to the payment of
interest, or if such excessive interest exceeds the principal unpaid balance
then outstanding hereunder and such other then outstanding Obligations, such
excess shall be refunded to the Borrowers. All sums paid or agreed to be paid
to the Agent or any Lender for the use, forbearance, or detention of the
Obligations and other Indebtedness of the Borrowers to the Agent or any Lender
shall, to the extent permitted by applicable law, be amortized, prorated,
allocated and spread throughout the full term of such Indebtedness until payment
in full so that the actual rate of interest on account of all such Indebtedness
does not exceed the Highest Lawful Rate throughout the entire term of such
Indebtedness. The terms and provisions of this Section shall control every
other provision of this Credit Agreement and all agreements among the Borrowers,
the Agent and the Lenders.
11.17 Right of Setoff. In addition to and not in limitation of all rights
---------------
of offset that any Lender may have under applicable law, each Lender shall, upon
the occurrence and during the continuance of any Event of Default and whether or
not such Lender has made any demand or all of the Obligations of any Credit
Party are matured, have the right to appropriate and apply to the payment of the
Obligations of such Credit Party all deposits (general or special, time or
demand, provisional or final) then or thereafter held by and other Indebtedness
or property then or thereafter owing by such Lender, including any and all
amounts in any Depositary Account, the BT Account or the Disbursement Account.
For purposes of this Section 11.17, the Obligations of a Credit Party to a
Lender shall include, as fully as though such Obligations were the direct
Obligations of such Credit Party to such Lender, the Obligations of such Credit
Party in which such Lender has a participation interest in any Letter of Credit
pursuant to Article 3, in each
-88-
case, to the extent of such participation. Each Lender exercising such rights
shall notify the Agent thereof and any amount received as a result of the
exercise of such rights shall be reallocated as set forth in Section 2.10.
11.18 Defaulting Lender. (a) Unless the Agent shall have received notice
-----------------
from a Lender, prior to the time specified in such Section, that such Lender
will not make available to the Agent a Loan required to be made by it pursuant
to Section 2.2 or its funding with respect to any participation interest in any
Letter of Credit pursuant to Article 3, the Agent may assume that such Lender
has made such amounts available to the Agent in accordance with such Sections
and the Agent in its sole discretion may, in reliance upon such assumption, make
available to the Borrowers or the applicable Issuing Lender a corresponding
amount on behalf of such Lender.
(b) If any amount referred to in subsection (a) of this Section 11.18 or
in Section 2.3 is not made available to the Agent by a Lender (a "Defaulting
Lender") and the Agent has made such amount available to the Borrowers or an
Issuing Lender, the Agent shall be entitled to recover such amount on demand
from such Defaulting Lender together with interest as hereinafter provided. If
such Defaulting Lender does not pay such amount forthwith upon the Agent's
demand therefor, the Agent shall promptly notify the Funds Administrator and the
Borrowers shall immediately (but in no event later than five Business Days after
such demand) pay such amount to the Agent together with interest calculated as
hereinafter provided. The Agent shall also be entitled to recover from such
Defaulting Lender and/or the Borrowers, as the case may be, (i) interest on such
amount in respect of each day from the date such corresponding amount was made
available by the Agent to the Borrowers to the date such amount is recovered by
the Agent, at a rate per annum equal to either (A) if paid by such Defaulting
Lender, the overnight Federal Funds Rate or (B) if paid by the Borrowers, the
then applicable rate of interest, calculated in accordance with Section 4.1 or
Section 4.2, plus (ii) in each case, an amount equal to any costs (including
----
legal expenses) and losses incurred as a result of the failure of such
Defaulting Lender to provide such amount as provided in this Credit Agreement.
Nothing herein shall be deemed to relieve any Lender from its duty to fulfill
its obligations hereunder or to prejudice any rights which the Borrowers or any
Issuing Lender, may have against any Lender as a result of any default by such
Lender hereunder, including the right of the Borrowers to seek reimbursement
from any Defaulting Lender for any amounts paid by the Borrowers under clause
(ii) above on account of such Defaulting Lender's default.
(c) (i) Notwithstanding anything contained herein to the contrary, so
long as any Lender is a Defaulting Lender or has rejected its Commitment, the
Agent shall not be obligated to transfer to such Lender (A) any payments made by
the Borrowers to the Agent for the benefit of such Lender or (B) any amounts
contemplated by Section 2.3(b)(i); and, such Lender shall not be entitled to the
sharing of any payments pursuant to Section 2.10. Amounts otherwise payable to
such Lender under Section 2.10 shall instead be paid to the Agent.
(ii) For purposes of voting or consenting to matters with respect to
the Credit Documents and determining Proportionate Share, such Defaulting Lender
shall be deemed not to be a "Lender" and such Lender's Commitment shall be
deemed to be zero (0).
(iii) This Section 11.18(c) shall remain effective with respect to a
Defaulting Lender until (A) the Obligations under this Credit Agreement shall
have been declared or shall
-89-
have become immediately due and payable or (B) the Majority Lenders, the Agent
and the Borrowers shall have waived such Lender's default in writing.
(iv) No Lender's Commitment shall be increased or otherwise affected, and
performance by the respective Borrowers shall not be excused, by the operation
of this Section 11.18(c). Any payments of principal or interest which would, but
for this subsection (c), be paid to any Lender, shall be paid to the Lenders who
shall not be in default under their respective Commitments and who shall not
have rejected any Commitment, for application to the Loans then due and payable
or to the other Obligations then due and payable or to provide cash collateral
to secure Obligations not then due and payable in such manner and order as shall
be determined by the Agent.
11.19 Rights Cumulative. Each of the rights and remedies of the Agent,
-----------------
each Issuing Lender and the Lenders under the Credit Documents shall be in
addition to all of their other rights and remedies under the Credit Documents
and applicable law, and nothing in the Credit Documents shall be construed as
limiting any such rights or remedies.
11.20 Third Party Beneficiaries. Each Issuing Lender shall be deemed to be
-------------------------
a third party beneficiary of its rights under this Credit Agreement, provided
that, except as otherwise provided in Section 11.10, such rights may be amended
or waived, and any departure therefrom by any Credit Party consented to, without
their respective consents.
11.21 Joint and Several Liability of Borrowers. Each of the Borrowers
----------------------------------------
shall be jointly and severally liable hereunder and under each of the other
Credit Documents with respect to all Obligations, regardless of which of the
Borrowers actually receives the proceeds of the Loans or the benefit of any
other extensions of credit hereunder, or the manner in which the Funds
Administrator, the Borrowers, the Agent, the Lenders or any of the Issuing
Lenders account therefor in their respective books and records. In furtherance
and not in limitation of the foregoing, (i) each Borrower's obligations and
liabilities with respect to proceeds of Loans which it receives or Letters of
Credit issued on its behalf, and related fees, costs and expenses, and (ii) each
Borrower's obligations and liabilities arising as a result of the joint and
several liability of the Borrowers hereunder with respect to proceeds of Loans
received by, or Letters of Credit issued for the account of, any of the other
Borrowers, together with the related fees, costs and expenses, shall be separate
and distinct obligations, both of which are primary obligations of such
Borrower. Neither the joint and several liability of, nor the Liens granted to
the Agent under the Collateral Documents by, any of the Borrowers shall be
impaired or released by (A) the failure of the Agent, any Lender or any Issuing
Lender, any successors or assigns thereof, or any holder of any Note or any of
the Obligations to assert any claim or demand or to exercise or enforce any
right, power or remedy against the Funds Administrator, any Borrower, any
Subsidiary of any Borrower, any other Person, the Collateral or otherwise; (B)
any extension or renewal for any period (whether or not longer than the original
period) or exchange of any of the Obligations or the release or compromise of
any obligation of any nature of any Person with respect thereto; (C) the
surrender, release or exchange of all or any part of any property (including
without limitation the Collateral) securing payment, performance and/or
observance of any of the Obligations or the compromise or extension or renewal
for any period (whether or not longer than the original period) of any
obligations of any nature of any Person with respect to any such property; (D)
any action or inaction on the part of the Agent, any Lender or any Issuing
-90-
Lender, or any other event or condition with respect to any other Borrower,
including any such action or inaction or other event or condition, which might
otherwise constitute a defense available to, or a discharge of, such Borrower,
or a guarantor or surety of or for any or all of the Obligations; and (E) any
other act, matter or thing (other than payment or performance of the
Obligations) which would or might, in the absence of this provision, operate to
release, discharge or otherwise prejudicially affect the obligations of such or
any other Borrower.
11.22 Appointment and Authorization of Funds Administrator.
----------------------------------------------------
(a) Each Borrower hereby designates, appoints, authorizes and empowers
Parent as its agent to act as specified in the capacity of Funds Administrator
under this Credit Agreement and each of the other Credit Documents and Parent
hereby acknowledges such designation, authorization and empowerment, and accepts
such appointment. Each Borrower hereby irrevocably authorizes and directs the
Funds Administrator to take such action on its behalf under the respective
provisions of this Credit Agreement and the other Credit Documents, and any
other instruments, documents and agreements referred to herein or therein, and
to exercise such powers and to perform such duties hereunder and thereunder as
are specifically delegated to or required of the Funds Administrator by the
respective terms and provisions hereof and thereof, and such other powers as are
reasonably incidental thereto, including, without limitation, to take the
following actions for and on such Borrower's behalf:
(i) to submit Notices of Borrowing, Notices of Conversion and
Notices of Continuation to Agent in accordance with the provisions of this
Credit Agreement, each such notice to be submitted by the Funds Administrator to
Agent as soon as practicable after its receipt of a request to do so from such
Borrower; and
(ii) to receive the proceeds of the Loans in accordance with the
provisions of this Credit Agreement, such proceeds to be disbursed to such
Borrower by the Funds Administrator as soon as practicable after its receipt
thereof; and
(iii) to submit requests for the issuance of Letters of Credit in
accordance with the provisions of this Credit Agreement, each such request for
the issuance of a Letter of Credit to be submitted by the Funds Administrator as
soon as practicable after its receipt of a request to do so from such Borrower.
The Funds Administrator is further authorized and directed by each of the
Borrowers to take all such actions on behalf of such Borrower necessary to
exercise the specific powers granted in clauses (i) through (iii) above and to
perform such other duties hereunder and under the other Credit Documents, and
deliver such documents as delegated to or required of the Funds Administrator by
the terms hereof or thereof.
(b) The Funds Administrator may perform any of its duties hereunder or
under any of the other Credit Documents by or through its agents or employees.
-Remainder of Page Intentionally Left Blank-
-Signature Page Follows-
-91-
IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to
be executed and delivered by their proper and duly authorized officers as of the
date set forth above.
BORROWERS:
XXXXXXXXX CONTAINERS, INC.
BWAY CORPORATION,
BWAY MANUFACTURING, INC.
XXXXXX CAN COMPANY, INC.,
each a Delaware corporation
By: /s/ Xxxxxxx X. X'Xxxxxxx
----------------------------------
Title: Vice President
-------------------------------
FUNDS ADMINISTRATOR
BWAY CORPORATION,
a Delaware corporation
By: /s/ Xxxxxxx X. X'Xxxxxxx
----------------------------------
Title: Vice President
-------------------------------
AGENT:
------
BANKERS TRUST COMPANY,
as Agent
By: /s/ Xxx X. Xxxxxxx
----------------------------------
Name: Xxx X. Xxxxxxx
--------------------------------
Title: Director
-------------------------------
LENDERS:
--------
BANKERS TRUST COMPANY
By: /s/ Xxx X. Xxxxxxx
---------------------------------
Name: Xxx X. Xxxxxxx
-------------------------------
Title: Director
------------------------------
ANNEX I
TO
CREDIT AGREEMENT
DATED AS OF MAY 22, 2001
CLOSING DOCUMENT LIST
---------------------
Attached
I-1
ANNEX II
TO
CREDIT AGREEMENT
DATED AS OF MAY 22, 2001
LENDERS' COMMITMENTS; LENDING OFFICES
-------------------------------------
1. BANKERS TRUST COMPANY:
Commitment: $90,000,000
Domestic Lending Office and LIBOR
Lending Office:
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
II-1
