CREDIT AGREEMENT
THIS CREDIT AGREEMENT (as amended, replaced, restated or
supplemented from time to time, this "Agreement") is made as of the
31st day of March, 1998 by and among XXXX X. XXXXXXXXXX & SON,
INC., a Delaware corporation ("Xxxxxxxxxx"), SUNSHINE NUT CO.,
INC., a Texas corporation ("Sunshine"), JBS INTERNATIONAL, INC., a
Barbados corporation ("JBS") and QUANTZ ACQUISITION CO., INC., a
Delaware corporation ("Quantz" and collectively with Xxxxxxxxxx,
Sunshine and JBS, the "Borrower"), the financial institutions
listed on the signature pages hereof and each other financial
institution that may hereafter become a party hereto in accordance
with the provisions hereof (collectively "Lenders" and individually
a "Lender") and U.S. BANCORP AG CREDIT, INC. f/k/a FBS Ag Credit,
Inc., a Colorado corporation ("U.S. Bancorp"), in its capacity as
Agent for the Lenders and for the Issuer (in such capacity, the
"Agent").
RECITAL
The Borrower has requested that Lenders make loans, advances,
extensions of credit and/or other financial accommodations to or
for the benefit of the Borrower, and Lenders are willing to do so
on the terms and conditions herein contained.
NOW, THEREFORE, in consideration of the foregoing and of the
terms and conditions contained in this Agreement, and of any loans
or extensions of credit or other financial accommodations at any
time made to or for the benefit of the Borrower by Lenders, the
Borrower and Lenders agree as follows:
1 DEFINITIONS.
1.1 GENERAL DEFINITIONS. When used herein, the following
capitalized terms shall have the meanings indicated, whether used
in the singular or the plural:
"ACCOUNTS" shall mean all present and future rights (including
without limitation, rights under any Margin Accounts) of the
Borrower to payment for Inventory or other goods sold or leased or
for services rendered, which rights are not evidenced by instru-
ments or chattel paper, regardless of whether such rights have been
earned by performance.
"ADJUSTED FUNDED DEBT" shall mean, without duplication, the
outstanding principal amount of all interest bearing indebtedness
for borrowed money (including without limitation, capitalized
leases and all current maturities of long term debt), minus all of
the Liabilities.
"AFFILIATE" shall mean any Person: (a) that directly or
indirectly, through one or more intermediaries, controls or is
controlled by, or is under common control with, the Borrower; (b)
that directly or beneficially owns or holds ten percent (10%) or
more of any class of the voting stock of the Borrower; (c) ten
percent (10%) or more of the voting stock (or in the case of a
Person which is not a corporation, ten percent (10%) or more of the
equity interest) of which is owned directly or beneficially or held
by the Borrower; or (d) that is a director or officer of the
Borrower. Notwithstanding the foregoing, neither the Agent nor any
Lender shall be deemed to be an Affiliate of the Borrower.
"AGENT" shall have the meaning set forth in the introduction
hereto and shall include any successor agent which has been
appointed in accordance with Section 12.7.
"AGENT'S LETTER" shall mean the letter agreement between the
Agent and the Borrower of even date with this Agreement.
"ANNIVERSARY DATE" shall mean April 1, 1999 and each April 1
thereafter.
"APPLICABLE MARGIN" shall mean with respect to Revolving Loans
which are Reference Rate Loans or Eurodollar Rate Loans, the rates
per annum set forth below for the then applicable Financial
Performance Level:
Financial
Performance Level Reference Rate Eurodollar Rate
Level 1 0.25% 2.0%
Xxxxx 0 0.0% 1.50%
Xxxxx 0 0.0% 1.25%
Xxxxx 0 0.0% 1.0%
Xxxxx 0 0.0% 0.75%
"AVAILABLE AMOUNT" shall mean, at any time, an amount equal
to the excess of: (a) the Loan Commitment minus (b) the sum of
(i) the aggregate amount of the Loan Liabilities, and (ii) the
aggregate amount of the LC Obligations.
"BAINBRIDGE BONDS" shall mean the bonds now or hereafter
issued pursuant to the Bainbridge Indenture.
"BAINBRIDGE BOND DOCUMENTS" shall mean all agreements,
instruments and documents as now in effect and executed or
delivered in connection with the Bainbridge Indenture, and as the
same may be amended, replaced, restated and/or supplemented from
time to time hereafter, including without limitation, the
Bainbridge Loan Agreement.
"BAINBRIDGE INDENTURE" shall mean that certain Trust
Indenture dated as of June 1, 1987 between the Decatur County -
Bainbridge Industrial Development Authority and Trust Company
Bank, as now in effect and as the same may be amended, replaced,
restated and/or supplemented from time to time hereafter.
"XXXXXXXXXX XX" shall mean any LC now in existence or
hereafter issued pursuant to this Agreement for the purpose of
securing the payment of principal or interest on the Bonds.
"BAINBRIDGE LOAN AGREEMENT" shall mean that certain Loan
Agreement dated as of June 1, 1987, between the Decatur County -
Bainbridge Industrial Development Authority and Xxxxxxxxxx, as
now in effect and as the same may be amended, replaced, restated
and/or supplemented hereafter.
"BAINBRIDGE LOAN DOCUMENTS" shall mean all agreements,
instruments and documents executed or delivered in connection
with the Bainbridge Loan Agreement, as now in existence and as
the same may be amended, replaced, restated and/or supplemented
from time to time.
"BAINBRIDGE TRUSTEE" shall mean the trustee under the
Bainbridge Indenture.
"BANK OF AMERICA" shall mean Bank of America Illinois,
individually and as collateral agent pursuant to that certain
Intercreditor and Collateral Agency Agreement dated as of January
24, 1997 among Bank of America Illinois, Xxxxxxxxxx, Sunshine,
Quantz Acquisition Co., Inc., and the other parties that were
signatories thereto.
"BUSINESS DAY" shall mean any day other than a day on which
commercial banks are authorized or required to close in Denver,
Colorado and, if such day relates to a borrowing of, a payment or
prepayment of principal of or interest on, a conversion of or
into, or an Interest Period for, a Eurodollar Rate Loan or a
notice by the Borrower with respect to any such borrowing,
payment, prepayment or Interest Period, any day which is also a
day on which dealings in Dollar deposits are carried on the
interbank market selected by the Agent for purposes of selling
the Eurodollar Rate.
"CAPITAL EXPENDITURES" shall mean, as to any Person for any
period, payments which are made by such Person for the lease,
purchase, improvement, construction or use of any property, the
value or cost of which under GAAP is required to be capitalized
and appear on such Person's balance sheet in the category of
property, plant or equipment, without regard to the manner in
which such payments or the instrument pursuant to which they are
made are characterized by such Person or any other Person, and
shall include without limitation, payments for the installment
purchase of property and payments under Capital Lease
Obligations.
"CAPITAL LEASE OBLIGATION" shall mean, at the time of any
determination thereof is to be made, the amount of the liability
in respect of a capital lease that would at such time be required
to be capitalized on a balance sheet in accordance with GAAP.
"CLOSING DATE" shall mean March 31, 1998.
"COMMITMENT" shall mean, as to any Lender, such Lender's
Loan Commitment and/or such Lender's LC Commitment, and
"COMMITMENTS" shall mean collectively, the Commitments for all
the Lenders.
"DEFAULT" shall mean the occurrence or existence of: (a) an
event which, through the passage of time or the service of notice
or both, would (assuming no action is taken by the Borrower or
any other Person to cure the same) mature into a Matured Default;
(b) an event which requires neither the passage of time nor the
service of notice to mature into a Matured Default; or (c) the
occurrence of a breach or a default under any other agreement at
any time in existence between the Borrower and the Agent or any
of the Lenders, including without limitation, any of the
Financing Agreements.
"DOLLARS" AND "$" shall mean lawful currency of the United
States of America.
"EBITDA" shall mean, for any period of determination and
with respect to any Person, the net income of such Person before
provision for income taxes, interest expense (including without
limitation, implicit interest expense on capitalized leases),
depreciation, amortization and other noncash expenses or charges,
excluding (to the extent otherwise included): (a) nonoperating
gains (including without limitation, extraordinary or
nonrecurring gains, gains from discontinuance of operations and
gains arising from the sale of assets other than Inventory or
property, plant and equipment) during the applicable period; and
(b) similar nonoperating losses during such period.
"EQUIPMENT" shall mean any and all goods, other than
Inventory (including without limitation, equipment, machinery,
implements, tools, parts and accessories) which are at any time
owned by the Borrower, together with any and all accessions,
parts and appurtenances.
"ERISA" shall mean the Employee Retirement Income Security
Act of 1974, as amended and in effect at any time.
"EURODOLLAR RATE" shall mean, with respect to each day
during each Interest Period pertaining to a Eurodollar Rate Loan,
the rate per annum equal to the rate at which Dollar deposits are
offered for such Interest Period as set forth on, at the option
of the Agent either the Reuters Screen LIBO Page or the Telerate
Screen LIBO Page, in both cases at or about 9:00 a.m. (Denver
time), two Business Days prior to the beginning of such Interest
Period.
"EURODOLLAR RATE LOAN" shall mean any Loan which bears
interest at the Eurodollar Rate plus the Applicable Margin.
"EXTENDED LC'S" shall mean any of the following: (a) any LC
issued for the purpose of securing industrial development bond
obligations of the Borrower; (b) the Xxxxxxxxxx XX; or (c) any LC
issued to the Commodity Credit Corporation or G.F.A./Commodity
Credit Corporation PGCMA and having an expiration date more than
twelve months after its issuance date.
"FARM PRODUCTS" shall mean all of the Borrower's seed and
harvested or unharvested crops of all types and descriptions,
whether annual or perennial and all other personal property of
the Borrower used or for use in farming operations, including
without limitation, native grass, grain, harvested crops, feed,
feed additives, feed ingredients, feed supplements, fertilizer,
hay, silage, supplies (including without limitation, veterinary
supplies and related goods) and livestock (including without
limitation, the offspring of such livestock and livestock in
gestation) and any other "farm products" (as defined in the Code-
).
"FINANCIAL PERFORMANCE LEVEL" shall mean the applicable
level of the Borrower's financial performance determined in
accordance with the table and paragraph set forth below.
FINANCIAL PERFORMANCE LEVEL RATIO OF ADJUSTED FUNDED DEBT TO EBITDA
Level 1 Greater than or equal to 4.01 to 1.0
Level 2 Less than 4.01 to 1.0 but greater than
or equal to 3.51 to 1.0
Level 3 Less than 3.51 to 1.0 but greater than
or equal to 3.01 to 1.0
Level 4 Less than 3.01 to 1.0 but greater than
or equal to 2.51 to 1.0
Level 5 Less than 2.51 to 1.0
The initial Financial Performance Level shall be Level 3.
Beginning with the Borrower's fiscal quarter ending in March,
1998, the Agent will review the Borrower's financial performance
as of each fiscal quarter end, after its receipt of the
Borrower's financial statements and compliance certificate for
such fiscal quarter, and will confirm the Borrower's calculation
of its ratio of quarter end Adjusted Funded Debt to rolling four
quarter EBITDA for such fiscal quarter. Any change in the
Financial Performance Level will be effective thirty (30) days
after Borrower's quarter end and Agent's receipt of the financial
statements and compliance certificate supporting such change. If
Borrower's financial statements and compliance certificate for
any fiscal quarter are not delivered to the Agent on a timely
basis, the Agent may, at its option, deem the Borrower's
Financial Performance Level to be Level 1 until ten (10) Business
Days after the Agent's receipt of such financial statements and
compliance certificate.
"FINANCING AGREEMENTS" shall mean this Agreement, the Notes,
the Agent's Letter and all agreements, instruments and documents,
including without limitation, all security agreements, loan
agreements, notes, letter of credit applications, guarantees,
mortgages, deeds of trust, chattel mortgages, subordination
agreements, pledges, guaranties, assignments of proceeds,
assignments of income, assignments of contract rights,
assignments of partnership interest, assignments of royalty
interests, assignments of performance or other collateral
assignments, completion or surety bonds, standby agreements,
undertakings, powers of attorney, consents, assignments,
contracts, notices, leases, financing statements and all other
documents, agreements, instruments and other written matter at
any time executed by or on behalf of the Borrower and delivered
to the Agent or any of the Lenders pursuant to this Agreement,
whether as security for the payment or performance of the Notes
or the Liabilities or otherwise, together with any and all
amendments, modifications, supplements, renewals, extensions,
increases and rearrangements of, and substitutions for, any of
the foregoing, and together with all agreements, instruments and
documents referred to therein or contemplated thereby.
"FISCAL YEAR" shall mean the fiscal year of the Borrower,
which shall be the twelve month period ending on the last
Thursday in June in each year.
"FIXED CHARGE COVERAGE RATIO" shall mean for any period of
determination, the ratio of: (a) Unallocated Cash Flow plus
interest paid during such period; over (b) the amount of
scheduled principal payments actually made during such period
with respect to long term debt, plus interest paid during such
period.
"GAAP" shall mean generally accepted accounting principles
set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial
Accounting Standards Board, or in such other statements by such
other entity as may be in general use by significant segments of
the accounting profession in the United States, which are
applicable to the circumstances as of the date of determination.
"GENERAL INTANGIBLES" shall mean all of the Borrower's
right, title and interest in and to any bank deposit accounts,
customer deposit accounts, deposits, rights related to prepaid
expenses, negotiable or nonnegotiable instruments or securities,
chattel paper, choses in action, causes of action and all other
intangible personal property of every kind and nature (other than
Accounts), including without limitation, corporate or other
business records, inventions, designs, patents, patent applica-
tions, trademarks, trade names, trade secrets, goodwill,
registrations, copyrights, licenses, franchises, customer lists,
tax refunds, tax refund claims, customs claims, guarantee claims,
cooperative memberships or patronage benefits, rights to any
government subsidy, set aside, diversion, deficiency or disaster
payment or payment in kind, milk bases, brands and brand
registrations, water rights (including without limitation, water
stock, ditch rights, well permits, water permits, applications
and the like), Commodity Credit Corporation storage agreements or
contracts, leasehold interests in real and personal property and
any security interests or other security held by or granted to
the Borrower to secure payment by any account debtor of any of
the Accounts, and any other "general intangibles" (as defined in
the Code).
"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, including without limitation, any arbitration panel,
any court or any commission.
"GOVERNMENTAL REQUIREMENT" shall mean any law, statute,
code, ordinance, order, rule, regulation, judgment, decree,
injunction, franchise, permit, certificate, license,
authorization or other directive or requirement of any federal,
state, county, municipal, parish, provincial or other
Governmental Authority or any department, commission, board,
court, agency or any other instrumentality of any of them.
"HIGHEST LAWFUL RATE" shall mean, with respect to each
Lender, the maximum nonusurious interest rate, if any, that at
any time or from time to time may be contracted for, taken,
reserved, charged, or received with respect to the Notes or on
other amounts, if any, payable to such Lender pursuant to this
Agreement or any other Financing Agreements, under laws
applicable to such Lender which are presently in effect, or, to
the extent allowed by law, under such applicable laws which may
hereafter be in effect and which allow a higher maximum
nonusurious interest rate than applicable laws now allow.
"INTEREST PERIOD" shall mean with respect to Eurodollar Rate
Loans, the period of time for which the Eurodollar Rate shall be
in effect as to any Eurodollar Rate Loan and which shall be a 1,
2, 3 or 6 month period of time, commencing with the borrowing
date of the Eurodollar Rate Loan or the expiration date of the
immediately preceding Interest Period, as the case may be,
applicable to and ending on the effective date of any rate change
or rate continuation made as provided in Section 3.2 as the
Borrower may specify in the notice of borrowing delivered
pursuant to Section 2.1 or the notice of interest conversion
delivered pursuant to Section 3.2; provided however, that: (a)
any Interest Period which would otherwise end on a day which is
not a Business Day shall be extended to the next succeeding
Business Day; (b) no Interest Period shall extend beyond the
Maturity Date; and (c) there shall be no more than 5 Interest
Periods at any one time.
"INVENTORY" shall mean any and all goods which shall at any
time constitute "inventory" (as defined in the Code) or Farm
Products of the Borrower, wherever located (including without
limitation, goods in transit), or which from time to time are
held for sale, lease or consumption, furnished under any contract
of service or held as raw materials, work in process, finished
inventory or supplies (including without limitation, packaging
and/or shipping materials).
"IRC" shall mean the Internal Revenue Code of 1986, as
amended, as in effect at any time, together with all regulations,
rulings and interpretations thereof or thereunder issued by the
Internal Revenue Service.
"ISSUER" shall mean any party that issues an LC pursuant to
this Agreement.
"LC" shall mean each letter of credit issued pursuant to
this Agreement.
"LC COMMITMENT" shall mean as to any Lender, such Lender's
Pro Rata Percentage of $20,000,000 using the percentage set forth
opposite such Lender's name under the heading "Loan Commitments"
on Exhibit 1A, as such amount may be reduced or terminated from
time to time pursuant to Section 4.4 or 11.1, less such Lender's
Pro Rata Percentage of payments received with respect to the LC
Obligations, and "LC Commitments" shall mean collectively, the LC
Commitments for all the Lenders.
"LC OBLIGATIONS" shall mean, at any time, an amount equal to
the sum of (a) the aggregate undrawn and unexpired amount of the
outstanding LC's plus (b) the aggregate amount of drawings under
LC's which have not been reimbursed pursuant to Section 2.2(f).
"LIABILITIES" shall mean any and all liabilities,
obligations and indebtedness of the Borrower to the Agent, the
Lenders or the Issuer under the Financing Agreements of any and
every kind and nature, at any time owing, arising, due or payable
and howsoever evidenced, created, incurred, acquired or owing,
whether primary, secondary, direct, contingent, fixed or
otherwise (including without limitation, LC Obligations and
obligations of performance) and whether arising or existing under
this Agreement or any of the other Financing Agreements or by
operation of law.
"LOAN COMMITMENT" shall mean as to any Lender, such Lender's
Pro Rata Percentage of $70,000,000 as set forth opposite such
Lender's name under the heading "Loan Commitments" on Exhibit 1A,
as such amount may be reduced or terminated from time to time
pursuant to Section 4.4 or 11.1, and "LOAN COMMITMENTS" shall
mean collectively, the Loan Commitments for all the Lenders.
"LOAN LIABILITIES" shall mean all of the Liabilities other
than the LC Obligations.
"LOANS" shall mean all loans made pursuant to this
Agreement, whether Reference Rate Loans or Eurodollar Rate Loans.
"MARGIN ACCOUNTS" shall mean all futures contracts or funds
and other property related to such futures contracts, which the
Borrower or the Borrower's authorized attorney-in-fact may
acquire, accumulate, withdraw or pay out, and which may be held
with any broker, including without limitation, any balance
credited to any Margin Account upon its closing.
"MATURED DEFAULT" shall mean the occurrence or existence of
any one or more of the following events: (a) the Borrower fails
to pay any of the Liabilities consisting of principal or interest
within five (5) Business Days after the time such Liabilities
have become due or are declared due; (b) the Borrower fails to
pay any of the Liabilities (other than principal and interest)
within ten (10) Business Days after the time such Liabilities
have become due or are declared due; (c) the Borrower fails or
neglects to perform, keep or observe any of the covenants,
conditions, promises or agreements contained in Sections 10.1,
10.2 or 10.4; (d) the Borrower fails or neglects to perform, keep
or observe any of the covenants, conditions, promises or agree-
ments contained in this Agreement or in any of the other
Financing Agreements (other than those covenants, conditions,
promises and agreements referred to or covered in (a), (b), and
(c) above and other than the covenants set forth in Section 9.6),
and such failure or neglect continues for more than thirty (30)
days after the earlier of the date the Agent gives the Borrower
written notice thereof or the date the Borrower first learns of
such failure or neglect, provided however, that such grace period
shall not apply, and a Matured Default shall be deemed to have
occurred and to exist immediately if such failure or neglect may
not, in the Agent's reasonable determination, be cured by the
Borrower during such thirty (30) day grace period; (e)
[intentionally omitted]; (f) any warranty or representation at
any time made by or on behalf of the Borrower in connection with
this Agreement or any of the other Financing Agreements is untrue
or incorrect in any material respect, or any schedule,
certificate, statement, report, financial data, notice, or
writing furnished at any time by or on behalf of the Borrower to
the Agent or the Lenders is untrue or incorrect in any material
respect on the date as of which the facts set forth therein are
stated or certified; (g) a judgment in excess of $1,000,000 is
rendered against the Borrower and such judgment remains
unsatisfied or undischarged and in effect for thirty (30)
consecutive days without a stay of enforcement or execution,
provided however, that this clause (g) shall not apply to any
judgment for which the Borrower is fully insured and with respect
to which the insurer has admitted liability in writing for such
judgment; (h) all or any part of the Borrower's assets come
within the possession of any receiver, trustee, custodian or
assignee for the benefit of creditors; (i) a proceeding under any
bankruptcy, reorganization, arrangement of debt, insolvency,
readjustment of debt or receivership law or statute is filed
against the Borrower or any guarantor of any of the Liabilities
and such proceeding is not dismissed within sixty (60) days of
the date of its filing, or a proceeding under any bankruptcy,
reorganization, arrangement of debt, insolvency, readjustment of
debt or receivership law or statute is filed by the Borrower or
any guarantor of any of the Liabilities, or the Borrower or any
guarantor of the Liabilities makes an assignment for the benefit
of creditors; (j) the Borrower or any guarantor of any of the
Liabilities voluntarily or involuntarily dissolves or is dis-
solved, terminates or is terminated or dies; (k) the Borrower is
enjoined, restrained, or in any way prevented by the order of any
court or any administrative or regulatory agency or by the
termination or expiration of any permit or license, from
conducting all or any material part of the Borrower's business
affairs; (l) the Borrower or any guarantor of any of the
Liabilities fails to make any payment due or otherwise defaults
on any other obligation for borrowed money in excess of
$1,000,000 and the effect of such failure or default is to cause
or permit the holder of such obligation or a trustee to cause
such obligation to become due prior to its date of maturity; (m)
any guarantor of any of the Liabilities purports to terminate its
guaranty or to limit the application thereof to then existing
Liabilities; (n) the Agent makes an expenditure under
Section 13.3 and the Borrower fails to reimburse the Agent for
such an expenditure in accordance with Section 13.3; (o) the
occurrence of a default, an event of default or a matured default
under any other agreement, instrument or document at any time
entered into between the Borrower and the Agent; or (p) the
Borrower fails or neglects to perform, keep or observe any of the
covenants, conditions, promises or agreements contained in
Section 9.6 of this Agreement, and such failure or neglect
continues for more than thirty (30) days after such failure or
neglect first occurs, provided however, that such grace period
shall not apply, and a Matured Default shall be deemed to have
occurred and to exist immediately if such failure or neglect may
not, in the Agent's reasonable determination, be cured by the
Borrower during such thirty (30) day grace period.
"MATURITY DATE" shall mean March 31, 2001, or such later
date as may be agreed upon in writing by the Borrower, the Agent
and the Lenders, or the earlier date of termination in whole of
the Commitments pursuant to Section 4.4 or 11.1.
"NOTES" shall mean the notes of the Borrower executed and
delivered pursuant to this Agreement.
"PENSION PLAN" shall mean any employee pension benefit plan
as defined in Section 3(2) of ERISA in which any personnel of the
Borrower or an Affiliate which is under common control with the
Borrower (within the meaning of Section 414 of the IRC)
participate and which is subject to Title IV of ERISA or Section
412 of the IRC.
"PERSON" shall mean any individual, sole proprietorship,
partnership, joint venture, trust, unincorporated organization,
association, corporation, limited liability company, limited
liability partnership, institution, entity, party or government
(whether national, federal, state, provincial, county, city,
municipal or otherwise, including without limitation, any
instrumentality, division, agency, body or department thereof).
"PRO RATA PERCENTAGE" shall mean 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
aggregate amount of all the Commitments of the Lenders, as
adjusted from time to time in accordance with Section 13.24.
"PRUDENTIAL" shall mean The Prudential Insurance Company of
America.
"PRUDENTIAL AGREEMENT" shall mean that certain Second
Amended and Restated Note Agreement dated as of January 24, 1997
between Xxxxxxxxxx and Prudential, as the same may be amended,
replaced, restated and/or supplemented from time to time.
"PRUDENTIAL NOTES" shall mean the "Notes" as such term is
defined in the Prudential Agreement.
"REFERENCE RATE" shall mean the reference rate quoted by
U.S. Bank as of 12:00 Noon on a given day in Minneapolis,
Minnesota, which is a base rate that U.S. Bank from time to time
establishes and which serves as a basis upon which effective
rates of interest are calculated for those loans which make
reference thereto. The Borrower acknowledges that said Reference
Rate is not necessarily the lowest index rate used or the lowest
rate made available to customers by said U.S. Bank.
"REQUIRED LENDERS" shall mean at any time, the Lenders
having at least sixty-three percent (63%) of the aggregate amount
of all of the Lenders' Commitments.
"TANGIBLE NET WORTH" shall mean as of any particular date,
the difference between: (a) the Borrower's combined total assets
as they would normally be shown on the balance sheet of the
Borrower in accordance with GAAP, adjusted by deducting: (i) all
values attributable to general intangibles, except: bank deposit
accounts; Margin Accounts; government subsidy, set aside,
diversion, deficiency or disaster payments receivable which are
properly assigned to the Agent; and Commodity Credit Corporation
storage agreement or contract receivables that are properly
assigned to the Agent; and by deducting (ii) Accounts due from
Affiliates with no further adjustment required for Accounts due
from Affiliates already eliminated in combination except Accounts
due from Affiliates which the Borrower could legally collect by
setoff against Accounts due to Affiliates; and (b) the Borrower's
combined total liabilities as they would normally be shown on the
balance sheet of the Borrower, adjusted by adding as liabilities:
(i) all capitalized leases and guarantees of the indebtedness of
Affiliates, with no further adjustment required for guaranteed
indebtedness already included in the combined balance sheet, and
by deducting from liabilities: (ii) any and all liabilities which
are expressly subordinated on terms satisfactory to the Agent.
"TEACHERS" shall mean Teachers Insurance and Annuity
Association of America.
"TEACHERS AGREEMENT" shall mean that certain Note Purchase
Agreement dated as of August 30, 1995 between Xxxxxxxxxx and
Teachers, as the same may be amended, replaced, restated and/or
supplemented from time to time.
"TEACHERS NOTES" shall mean the "Notes" as such term is
defined in the Teachers Agreement.
"TYPE" shall mean, with respect to any Loan, whether such
Loan is a Reference Rate Loan or a Eurodollar Rate Loan.
"UNALLOCATED CASH FLOW" shall mean for any period of
determination (a) EBITDA during such period, plus (b) net new
long term debt incurred during such period, plus (c) net capital
contributions during such period, minus (d) the amount of cash
income taxes paid during such period, minus (e) the amount of
cash dividends paid during such period, minus (f) the amount of
cash interest paid during such period, minus (g) the net amount
of capital expenditures during such period.
"U.S. BANK" shall mean a national banking association with
its principal place of business in Minneapolis, Minnesota and an
Affiliate of the Agent, which now or in the past is or has been
known as U.S. Bank, and its successors and assigns, whether or
not it or any such successor or assign is then known by such
name.
"WORKING CAPITAL" shall mean as of any particular date, the
amount of the Borrower's combined current assets, less the
Borrower's combined current liabilities (including without
limitation, the aggregate amount of Loans outstanding) determined
in accordance with GAAP, adjusted by deducting: (i) all values
attributable to general intangibles, except: bank deposit
accounts; Margin Accounts; government subsidy, set aside,
diversion, deficiency or disaster payments receivable which are
properly assigned to the Agent; and Commodity Credit Corporation
storage agreement or contract receivables that are properly
assigned to the Agent; and by deducting (ii) Accounts due from
Affiliates with no further adjustment required for Accounts due
from Affiliates already eliminated in combination except Accounts
due from Affiliates which the Borrower could legally collect by
setoff against Accounts due to Affiliates, and treating as equity
any and all liabilities which are expressly subordinated on terms
satisfactory to the Agent.
"WORKING CAPITAL RATIO" shall mean as of any particular
date, the ratio of the Borrower's combined current assets, to the
Borrower's combined current liabilities determined in accordance
with GAAP, treating all amounts currently owing to Affiliates as
current liabilities and giving no value as assets to any amounts
currently owing from Affiliates.
1.2 INDEX TO OTHER DEFINITIONS. When used herein, the
following capitalized terms shall have the meanings given in the
indicated portions of this Agreement:
TERM LOCATION
Agreement introduction
Application Section 2.2(c)
Assignee Section 13.24
Assignment and Acceptance Section 13.24
Borrower introduction
Code Section 1.4
Default Rate Section 3.1(c)
Environmental Laws Section 7.9
Equalization Transfer Section 2.1(c)
ERISA Section 7.19
Excess Section 13.19
U.S. Bancorp introduction
Issuer Section 2.2
Lenders introduction
Loan Section 2.1(a)
Loan Account Section 2.1(o)
Note
Section 2.1(h)Purchasing Section 2.1(f)
Lender
Selling Lender Section 2.1(f)
Taxes Section 5.5(a)
UCP Section 2.2(d)
1.3 ACCOUNTING TERMS. Any accounting terms used in this
Agreement which are not specifically defined in this Agreement
shall have the meanings customarily given them in accordance
with GAAP.
1.4 OTHERS DEFINED IN COLORADO UNIFORM COMMERCIAL CODE.
All other terms contained in this Agreement (which are not
specifically defined in this Agreement) shall have the meanings
set forth in the Uniform Commercial Code of Colorado ("Code") to
the extent the same are used or defined therein.
2 LOANS AND LETTERS OF CREDIT.
2.1 LOANS.
(a) Subject to the terms and conditions and relying upon
the representations and warranties herein set forth, each Lender
severally agrees to make revolving credit loans (each a "Loan"
and more than one Loan, the "Loans") to the Borrower on any one
or more Business Days prior to the Maturity Date, up to an
aggregate principal amount of Loans not exceeding each such
Lender's Pro Rata Percentage of the Available Amount on such
Business Day. Within such limits and during such period and
subject to the terms and conditions of this Agreement, the
Borrower may borrow, repay and reborrow Loans.
(b) It is anticipated that on each Business Day the
Borrower may wish to borrow and repay Reference Rate Loans. To
minimize the number of transfers of funds to and from the
Lenders resulting from such borrowings and repayments, the Agent
will fund daily Reference Rate Loans for the accounts of the
Lenders and will apply daily repayments of Reference Rate Loans
to the accounts of the Lenders, other than according to the
Lenders' Pro Rata Percentages (i.e., without receiving from the
other Lenders their Pro Rata Percentage of a Reference Rate Loan
on the date of disbursement thereof or without paying the other
Lenders their Pro Rata Percentage of a repayment of a Reference
Rate Loan on the date of payment thereof), provided however,
that no such Reference Rate Loan shall be made and no repayment
of a Reference Rate Loan shall be applied other than according
to the Lenders' Pro Rata Percentages, if: (i) at the time of
such Reference Rate Loan or repayment the Agent has actual
knowledge of a Matured Default, or (ii) after giving effect to
the requested Reference Rate Loan or after applying the
repayment, the absolute value of the amount that would have to
be reallocated to make the Reference Rate Loans held according
to the Lenders' Pro Rata Percentages, would exceed $5,000,000.
(c) At any time in the discretion of the Agent and in any
event on the next to last Business Day of each week if the
outstanding Reference Rate Loans are not held according to the
Lenders' Pro Rata Percentages, the Agent shall give notice to
the Lenders of the amount of funds to be transferred from the
Agent to the Lenders, or from the Lenders to the Agent, or from
one Lender to another, as the case may be (each such transfer,
an "Equalization Transfer") required to cause the Reference Rate
Loans to be held by the Lenders according to their Pro Rata
Percentages. On the next Business Day following such notice the
necessary Equalization Transfers shall be made in immediately
available funds not later than 11:00 a.m. (Denver time).
(d) Except as provided in Section 2.1(e), any Equalization
Transfer by the Lenders to the Agent shall be deemed to
constitute Reference Rate Loans by such Lenders to the Borrower
the proceeds of which will immediately be used to make
repayments of Reference Rate Loans held by the Agent, and any
Equalization Transfer by the Agent to the Lenders shall be
deemed to constitute Reference Rate Loans by the Agent to the
Borrower the proceeds of which will immediately be used to make
repayments of Reference Rate Loans held by the Lenders.
(e) In the event that on the date on which any Equalization
Transfer is required to be made pursuant to Section 2.1(c), a
Matured Default of the type described in clause (i) of the
definition thereof shall have occurred and be continuing, any
Equalization Transfer by the Lenders to the Agent, and any
Equalization Transfer by the Agent to the Lenders shall be
deemed to constitute a purchase by the Lenders or the Agent, as
the case may be, of a direct interest, in the amount of such
Equalization Transfer, in outstanding Reference Rate Loans of
the Lenders to the Borrower, to the end that each of the Lenders
shall have an interest therein equal to their respective Pro
Rata Percentages as of the date of occurrence of such Matured
Default.
(f) At any time after any Lender (a "Selling Lender") has
received any Equalization Transfer that constitutes a purchase
by any other Lender (a "Purchasing Lender") of a direct interest
in such Selling Lender's Reference Rate Loans pursuant to
Section 2.1(e), if such Selling Lender receives any payment on
account of its Reference Rate Loans, such Selling Lender will
distribute to such Purchasing Lender its proportionate share of
such payment (appropriately adjusted in the case of interest
payments, to reflect the period of time during which such
Purchasing Lender's direct interest was outstanding and funded);
provided however, that in the event that such payment received
by such Selling Lender is required to be returned, such
Purchasing Lender will return to such Selling Lender any portion
thereof previously distributed to it by such Selling Lender.
(g) Each Lender's obligation to make Equalization Transfers
pursuant to Section 2.1(c) shall be absolute and unconditional
and shall not be affected by any circumstance, including without
limitation, (i) any set-off, counterclaim, recoupment, defense
or other right which such Lender or any other Person may have
against the Agent or any other Person for any reason whatsoever;
(ii) the occurrence or continuance of a Default or a Matured
Default or the termination of the Commitments; (iii) any adverse
change in the condition (financial or otherwise) of the Borrower
or any other Person; (iv) any breach of this Agreement by the
Borrower or any other Lender, including without limitation, any
other Lender's failure to make any Equalization Transfer; or (v)
any other circumstance, happening or event whatsoever, whether
or not similar to any of the foregoing.
(h) The Borrower shall execute and deliver to the Agent for
each Lender to evidence the Loans made by each Lender under such
Lender's Loan Commitment, a revolving credit note (each such
note, a "Note" and more than one Note, the "Notes"), which shall
be (i) dated the date of the Closing Date; (ii) in the principal
amount of such Lender's maximum Loan Commitment; and (iii) in
substantially the form attached as Exhibit 2A, appropriately
completed. Each Lender shall post (iv) the date and principal
amount of each Loan made under such Note; (v) the rate of
interest each such Loan will bear; and (vi) each payment of
principal thereon; provided however, that any failure of such
Lender to so post shall not affect the Borrower's obligations
thereunder; and provided further, that such Lender's records as
to such matters shall be controlling whether or not such Lender
has so posted. The outstanding principal balance of each Note
shall be payable on or before the Maturity Date.
(i) In the event that the Borrower fails to pay any
principal or interest on the date the same is due and payable,
the Agent may notify the Lenders to make a Loan to pay such past
due amount and each Lender shall post its records with respect
to such Loan in accordance with Section 2.1(h) of this
Agreement; provided however, that any failure of such Lender to
so post shall not affect the Borrower's obligations hereunder or
under the Notes; and provided further, that such Lender's
records as to such matters shall be controlling.
(j) Each borrowing under this Agreement shall in the case
of any Eurodollar Rate Loan, be in an aggregate amount of not
less than $1,000,000 or in integral multiples of $100,000 in
excess thereof; and at the option of the Borrower, any borrowing
may be comprised of two or more Loans bearing different rates of
interest; provided however, that Loans made on the Closing Date
or on the first Business Day after the Closing Date shall bear
interest from the date of such Loan at a rate per annum equal to
the lesser of (i) the Reference Rate in effect from time to time
plus the Applicable Margin, or (ii) the Highest Lawful Rate,
unless and until the Borrower gives notice under Section 3.2,
and provided further that the Borrower may not have more than
five (5) Eurodollar Rate Loans outstanding at any one time.
Each Loan shall be made upon prior written notice from the
Borrower to the Agent delivered not later than 11:00 a.m.
(Denver time) on the Closing Date with respect to any Loans to
be made on the first Business Day after the Closing Date, or
with respect to any Loans made thereafter, on the same Business
Day as the proposed Loan if such borrowing is a Loan which is a
Reference Rate Loan, or two Business Days prior to the proposed
Loan if such borrowing is a Loan which is a Eurodollar Rate
Loan. Each such notice of borrowing with respect to the Loans
shall be irrevocable and shall specify (iii) the amount of the
proposed borrowing; (iv) the date of the proposed borrowing; (v)
the Type of each such Loan; and (vi) with respect to any
Eurodollar Rate Loan, the Interest Period with respect to each
such Loan and the expiration date of each such Interest Period.
The Borrower shall give the Agent written (including
facsimile) notice by the required time of any proposed
borrowing. Neither the Agent nor any Lender shall incur any
liability to the Borrower in acting upon any facsimile notice
referred to above which the Agent believes in good faith to have
been given by the Borrower, or for otherwise acting in good
faith under this Section 2.1(j).
(k) The Agent shall promptly notify each Lender of any
notice received by the Agent from the Borrower pursuant to
Section 2.1(j). In the case of a proposed borrowing of a Loan
comprised of Eurodollar Rate Loans, the Agent shall also
promptly notify each Lender of the applicable interest rate.
Each Lender shall, before 11:00 a.m. (Denver time) on the date
for any proposed Eurodollar Rate Loan and before 12:00 noon
(Denver time) on the date for any proposed Reference Rate Loan,
make available for the account of the Agent at its address set
forth in Section 13.18, in same day funds, its Pro Rata
Percentage of such borrowing. After the Agent's receipt of such
funds and upon fulfillment of the applicable conditions set
forth in Article 8, on the date for the proposed Loan, the Agent
shall make the borrowing available to the Borrower in
immediately available funds. Any Loan made by the Agent
pursuant to a request believed by the Agent to be an authorized
request by the Borrower for a Loan shall be deemed to be a Loan
for all purposes with the same effect as if the Borrower had in
fact requested the Agent to make such Loan.
(l) Unless the Agent shall have received notice from a
Lender prior to the date of any borrowing of a Loan that such
Lender will not make available to the Agent such Lender's Pro
Rata Percentage of such Loan, the Agent may assume that such
Lender has made such portion available to the Agent on the date
of such Loan in accordance with Section 2.1 and the Agent may,
in reliance upon such assumption, make available to the Borrower
on such date a corresponding amount. If and to the extent that
such Lender shall not have so made its Pro Rata Percentage
available to the Agent, such Lender and the Borrower severally
agree to repay to the Agent, within five (5) Business Days after
demand therefor, such corresponding amount together with
interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid
to the Agent, (i) in the case of the Borrower, at the interest
rate applicable at the time the Loans comprising such borrowing
were made, and (ii) in the case of such Lender, at the federal
funds rate. If such Lender shall repay to the Agent such
corresponding amount, such amount so repaid shall constitute
such Lender's Loan as part of such borrowing for purposes of
this Agreement.
(m) The failure of any Lender to make the Loan or
Equalization Transfer to be made by it as required by this
Agreement shall not relieve any other Lender of its obligation,
if any, to make its Loan or Equalization Transfer on the date
the same is required to be made, but no Lender shall be
responsible for the failure of any other Lender to make the Loan
or Equalization Transfer to be made by such other Lender on the
date required for the same.
(n) Loans may be made by the Agent on the Agent's receipt
of written notice from the Chairman of the Board, the President
or the Chief Financial Officer of Xxxxxxxxxx (provided that the
Agent shall have received a satisfactory incumbency certificate
containing a specimen signature of any such officer giving such
notice), who are authorized to request Loans and direct the
disposition of any such Loans until written notice of the
revocation of such authority is received by the Agent at its
address designated below. Any such Loans shall be conclusively
presumed to have been made to or for the benefit of the Borrower
when the Agent believes in good faith that such notice was made
by authorized persons, or when said Loans are deposited to the
credit of the account of the Borrower regardless of the fact
that Persons other than those authorized hereunder may have
authority to draw against such account.
(o) The Agent shall maintain a loan account ("Loan
Account") on its books in which shall be recorded: (a) all Loans
to the Borrower pursuant to this Agreement; (b) all payments
made by the Borrower on all Loans; and (c) all other appropriate
debits and credits as provided in this Agreement, including
without limitation, all fees, charges, expenses and interest.
All entries in the Borrower's Loan Account shall be made in
accordance with the Agent's customary accounting practices as in
effect from time to time. The Borrower promises to pay the
amount reflected as owing by and under its Loan Account and all
other obligations hereunder as such amounts become due or are
declared due pursuant to the terms of this Agreement.
(p) All Loans to the Borrower, and all other debits and
credits provided for in this Agreement, shall be evidenced by
entries made by the Agent in its internal data control systems
showing the date and amount of each such debit or credit. The
balance in the Borrower's Loan Account, as set forth on the
Agent's most recent printout, shall be rebuttable presumptive
evidence of the amounts due and owing the Agent, the Lenders and
the Issuer by the Borrower.
(q) The purpose of the Loans is to provide working capital
for the Borrower's operations and for the making of capital
expenditures and acquisitions otherwise permitted by this
Agreement.
2.2 LC'S.
(a) Subject to the terms and conditions of this Agreement,
the Borrower may from time to time request that the Agent issue
or cause to be issued by an Affiliate of the Agent one or more
LC's for the Borrower's account for any proper business purpose
as determined by the Agent in its reasonable discretion (the
Agent or its Affiliate thereby becoming the "Issuer"); provided
however, that except as provided in Section 2.2(b), the Agent
shall not issue or cause its Affiliate to issue any such LC if
(i) such issuance would cause the LC Obligations to exceed
$20,000,000 at the time of such issuance, (ii) the face amount
of such LC exceeds the Available Amount at the time of such
issuance, or (iii) the proposed expiry date for the LC is on or
after a date which is the earlier of (A) twelve (12) months
after its date of issuance or (B) the Maturity Date.
(b) Subject to the terms and conditions of this Agreement,
the Borrower may from time to time request that the Agent issue
or cause to be issued by an Affiliate of the Agent Extended LC's
for the Borrower's account (the Agent or its Affiliate thereby
becoming the "Issuer"); provided however, that the Agent shall
not issue or cause its Affiliate to issue any such Extended LC's
if (i) such issuance would cause the LC Obligations to exceed
$20,000,000 at the time of such issuance, (ii) the face amount
of such LC exceeds the Available Amount at the time of such
issuance, or (iii) the proposed expiry date for the Extended LC
is on or after June 1, 2002.
(c) In order to effect the issuance of each LC, the
Borrower shall deliver to the Agent a letter of credit
application (the "Application") not later than 11:00 a.m.
(Denver time), five (5) Business Days prior to the proposed date
of issuance of the LC. The Application shall be duly executed
by a responsible officer of the Borrower, shall be irrevocable
and shall (i) specify the day on which such LC is to be issued
(which shall be a Business Day), and (ii) be accompanied by a
certificate executed by a responsible officer stating that all
conditions precedent to such issuance have been satisfied and
setting forth calculations evidencing availability for any LC as
required pursuant to Section 2.2(a).
(d) Upon receipt of the Application, and satisfaction of
the applicable terms and conditions of this Agreement, and
provided however, that no Default or Matured Default exists, or
would, after giving effect to the issuance of the LC, exist, the
Agent or its Affiliate shall issue such LC no later than the
close of business, in Denver, Colorado or Minneapolis,
Minnesota, on the date so specified. The Agent shall provide the
Borrower and each Lender with a copy of the LC which has been
issued. Each LC shall (i) provide for the payment of drafts
presented for honor thereunder by the beneficiary in accordance
with the terms thereof, when such drafts are accompanied by the
documents described in the LC, if any, and (ii) to the extent
not inconsistent with the express terms hereof or the applicable
Application, be subject to the Uniform Customs and Practice for
Documentary Credits (1993 Revision), International Chamber of
Commerce Publication No. 500 (together with any subsequent
revisions thereof approved by a Congress of the International
Chamber of Commerce and adhered to by the Agent or its
Affiliate, the "UCP"), and shall, as to matters not governed by
the UCP, be governed by, and construed and interpreted in
accordance with, the laws of the State of Minnesota.
(e) Upon the issuance date of each LC, the Agent shall be
deemed, without further action by any party hereto, to have sold
to each other Lender, and each other Lender shall be deemed,
without further action by any party hereto, to have purchased
from the Agent, a participation, to the extent of such Lender's
Pro Rata Percentage, in the LC, the obligations thereunder and
in the reimbursement obligations of the Borrower due in respect
of drawings made under the LC. If requested by the Agent, the
other Lenders will execute any other documents reasonably
requested by the Agent to evidence the purchase of such
participations.
(f) Upon the presentment of a draft for honor under any LC
by the beneficiary thereof which the Issuer has determined is in
compliance with the conditions for payment thereunder, the
Issuer shall promptly notify the Borrower, the Agent (as
applicable) and each Lender of the intended date of honor of
such draft, the amount due and owing in respect of such draft
shall automatically and without any action by any Person be due
and payable by the Borrower on the intended date of honor, and
each Lender shall, notwithstanding any other provision of this
Agreement (including the occurrence and continuance of a Default
or a Matured Default), make available to the Agent for the
benefit of the Issuer an amount equal to its Pro Rata Percentage
of the presented draft on the day the Issuer is required to
honor such draft. If such amount is not in fact made available
to the Agent by such Lender on such date, such amount shall bear
interest at the lesser of (i) the federal funds rate or (ii) the
Highest Lawful Rate, payable on demand by the Agent. Each
drawing under any LC shall constitute a request by the Borrower
to the Agent for a borrowing pursuant to Section 2.1(a) of Loans
in the amount of such drawing.
(g) The Borrower's obligation to reimburse the Issuer for
the amount of any draft drawn under an LC shall be absolute,
unconditional and irrevocable and shall be paid immediately to
the Agent for the account of the Lenders upon demand by the
Agent, and otherwise strictly in accordance with the terms of
this Agreement, under all circumstances whatsoever, including
without limitation, the following circumstances:
(i) The existence of any claim, set-off, defense or
other rights which the Borrower may have at any time against any
beneficiary or any transferee of any LC (or any Person for whom
any such beneficiary or any such transferee may be acting), the
Issuer, any Lender or any other Person, whether in connection
with this Agreement, any other Financing Agreement, the
transactions contemplated herein or therein or any unrelated
transaction, unless otherwise provided by the terms of such LC;
(ii) Any statement or any other document presented
under any LC proving to be forged, fraudulent or invalid in any
respect or any statement therein being untrue or inaccurate in
any respect;
(iii) Payment by the Issuer under any LC against
presentation of a draft or certificate which does not comply
with the terms of such LC, provided however, that such payment
shall not have constituted gross negligence or willful
misconduct of the Issuer; and
(iv) Any other circumstance or event whatsoever,
whether or not similar to the foregoing, provided however, that
such other circumstance or event shall not have been the result
of gross negligence or willful misconduct of the Issuer.
(h) The Borrower assumes all risks of the acts or omissions
of the beneficiary and any transferee of each LC with respect to
its use of such LC. Neither the Issuer, the Agent nor any Lender
shall be liable or responsible for, and the Borrower indemnifies
and holds the Issuer, the Agent and each Lender harmless for:
(i) the use which may be made of any LC or for any acts or
omissions of the beneficiary and any transferee thereof in
connection therewith, or (ii) the validity or genuineness of
documents, or of any endorsement(s) thereon, even if such
documents should, in fact prove to be in any or all respects
invalid, fraudulent or forged, or any other circumstances
whatsoever in making or failing to make payment, against the
Issuer, the Agent or any Lender, except damages determined to
have been caused by gross negligence or willful misconduct of
the Issuer in determining whether documents presented under an
LC comply with the terms of such LC and there shall have been a
wrongful payment as a result thereof; provided however, that it
is the intention of the Borrower to indemnify the Issuer, the
Agent and each Lender for the negligence of the Issuer, the
Agent or each Lender respectively, other than negligence
constituting gross negligence or willful misconduct. In
furtherance and not in limitation of the foregoing, the Issuer
may accept documents that appear on their face to be in order,
without responsibility for investigation, regardless of any
notice or information to the contrary.
(i) In the event that any provision of an Application is
inconsistent, or in conflict with, any provision of this
Agreement, including provisions for the rate of interest
applicable to draws thereunder, delivery of collateral or rights
of set-off or any representations, warranties, covenants or any
events of default set forth therein, the provisions of this
Agreement shall govern.
(j) If any LC to be issued has an expiration date after the
Maturity Date, then as a condition to the issuance thereof, the
Borrower shall deposit with the Agent, for the ratable benefit
of the Lenders and the Issuer, cash collateral or other liquid
collateral, of a type and in an amount which is satisfactory to
the Lenders, in their sole discretion, to secure the LC
Obligations relating to such LC.
3 INTEREST.
3.1 INTEREST.
The Borrower shall pay interest on the unpaid principal
amount of each Loan made by each Lender from the date of such
Loan until such principal amount shall be paid in full, at the
times and at the rates per annum set forth below:
(a) So long as no Matured Default has occurred or is
continuing, during such periods as such Loan is a Reference Rate
Loan, a rate per annum equal to the lesser of (i) the sum of the
Reference Rate in effect from time to time plus the Applicable
Margin and (ii) the Highest Lawful Rate, payable monthly in
arrears on the first day of each month commencing April 1, 1998,
and on the Maturity Date. With respect to each Reference Rate
Loan, the rate of interest accruing shall change concurrently
with each change in the Reference Rate as announced by U.S.
Bank.
(b) So long as no Matured Default has occurred or is
continuing, during such periods as such Loan is a Eurodollar
Rate Loan, a rate per annum during each Interest Period for such
Loan, equal to the lesser of (i) the sum of the Eurodollar Rate
for such Interest Period for such Loan plus the Applicable
Margin and (ii) the Highest Lawful Rate, payable monthly in
arrears on the first day of each month during the applicable
Interest Period, and on the last day of such Interest Period.
(c) After the occurrence of a Matured Default the Agent
may notify the Borrower that for so long as such Matured Default
is continuing, any amount due hereunder, under the Notes or
under any other Financing Agreements, whether for principal,
interest (to the extent permitted by applicable law), fees,
expenses or otherwise, shall bear interest, from the date on
which such Matured Default occurs and during the continuation of
such Matured Default, payable on demand, at a rate per annum
(the "Default Rate") equal to the lesser of (i) the sum of three
percent (3.0%) per annum plus the Reference Rate in effect from
time to time and (ii) the Highest Lawful Rate.
(d) All computations of interest pursuant to this Section
3.1 shall be made by the Agent on the basis of a year of 360
days, unless the foregoing would result in a rate exceeding the
Highest Lawful Rate, in which case such computations shall be
based on a year of 365 or 366 days, as the case may be.
Interest, whether based on a year of 360, 365 or 366 days, shall
be charged for the actual number of days (including the first
day but excluding the last day) occurring in the period for
which such interest is payable. Each determination by the Agent
of an interest rate hereunder shall be conclusive and binding
for all purposes, absent manifest error.
3.2 VOLUNTARY CONVERSION OF LOANS.
The Borrower may on any Business Day, upon the Borrower's
written (including facsimile) notice given by the Borrower to
the Agent not later than 11:00 a.m. (Denver time) on the day
which is two Business Days prior to the date of any proposed
interest conversion or rollover, convert Loans from one Type to
another Type, or continue or rollover existing Eurodollar Rate
Loans; provided however, (a) with respect to any conversion into
or rollover of a Eurodollar Rate Loan, no Default or Matured
Default shall have occurred and be continuing, (b) with respect
to any facsimile notice of interest conversion, the Borrower
shall promptly confirm such notice by sending the original
notice to the Agent, and (c) any continuation or rollover of
Eurodollar Rate Loans for the same or a different Interest
Period or into Reference Rate Loans, shall be made on, and only
on, the last day of the Interest Period for such Eurodollar Rate
Loans. Each such notice of interest conversion shall specify
therein (d) the requested date of such conversion, and (e) if
such interest conversion is into Loans constituting Eurodollar
Rate Loans, the duration of the requested Interest Period for
each such Loan. The Agent shall promptly deliver a copy of each
such notice to each Lender. Each such notice shall be
irrevocable and binding on the Borrower. If the Borrower shall
fail to give a notice of interest conversion with respect to any
Eurodollar Rate Loan as set forth above, such Loan shall
automatically convert to a Reference Rate Loan on the last day
of the Interest Period with respect thereto.
4 PAYMENTS; PREPAYMENTS; TERMINATION OF COMMITMENTS; ETC.
4.1 PAYMENT OF LOANS.
(a) Whenever any payment hereunder or under any Note shall
be due on a day other than a Business Day, the date for payment
of such amounts shall be extended to the next succeeding
Business Day, and such extension of time shall be included in
the computation of payment of interest.
(b) The Borrower shall make each payment hereunder and
under the Notes not later than 11:00 a.m. (Denver time) on the
day when due in lawful money of the United States and in
immediately available funds to the Agent for the account of the
Lenders. Subject to Section 2.1, the Agent will promptly
distribute in lawful money of the United States and in
immediately available funds to each Lender its ratable (based on
the respective Pro Rata Percentages of the Lenders) share of
each such payment received by the Agent for the account of the
Lenders.
4.2 OPTIONAL PREPAYMENTS ON THE LOANS.
The Borrower may at any time prepay the outstanding
principal amount of any Loan, in either case in whole or in
part, in accordance with this Section 4.2. The Borrower shall
give prior notice of any such prepayment to the Agent, which
notice shall be written for any prepayment of a Eurodollar Rate
Loan, and which notice shall state the proposed date of such
prepayment (which shall be a Business Day), and which notice
shall be delivered to the Agent not later than 11:00 a.m.
(Denver time): (a) with respect to any Loan which is a Reference
Rate Loan, on the date of prepayment, and (b) with respect to
any Loan which is a Eurodollar Rate Loan, two (2) Business Days
prior to the date of prepayment. All prepayments of Reference
Rate Loans shall be without premium or penalty of any kind. All
prepayments of Eurodollar Rate Loans shall be made together with
accrued and unpaid interest (if any) to the date of such
prepayment on the principal amount prepaid without premium or
penalty thereon, provided however, that funding losses incurred
by any Lender as described in Section 5.3 shall be payable with
respect to each such prepayment. All notices of prepayment
shall be irrevocable and the payment amount specified in each
such notice shall be due and payable on the prepayment date
described in such notice, together with, in the case of
Eurodollar Rate Loans, accrued and unpaid interest (if any) on
the principal amount prepaid and any amounts due under Section
5.3. The Borrower shall have no optional right to prepay the
principal amount of any Eurodollar Rate Loan other than as
provided in this Section 4.2.
4.3 INTENTIONALLY OMITTED.
4.4 TERMINATION OF THE COMMITMENTS.
The Agent shall have the right, with the consent of the
Required Lenders and without notice to the Borrower, to
terminate the Commitments immediately upon a Matured Default, or
upon the repayment in full of all of the Liabilities. In
addition, the Loan Commitments shall be deemed immediately
terminated and all of the Liabilities shall be immediately due
and payable, without notice to the Borrower, on the Maturity
Date. In the event any of the Commitments are terminated, the
remainder of this Agreement shall remain in full force and
effect until the indefeasible full payment and full satisfaction
of the Liabilities. Notwithstanding the foregoing, in the event
that a proceeding under any bankruptcy, reorganization,
arrangement of debt, insolvency, readjustment of debt or
receivership law or statute is filed by or against the Borrower,
or the Borrower makes an assignment for the benefit of
creditors, the Commitments shall be deemed to be terminated
immediately, and all the Liabilities shall be due and payable,
provided however, that in the event a proceeding against the
Borrower is dismissed within sixty (60) days of the date of its
filing and there is then no other basis for the termination of
the Commitments or the acceleration of the Liabilities, then the
Commitments shall be deemed to be reinstated and the
acceleration of the Liabilities shall be deemed to be rescinded,
both as of the date the order of dismissal becomes final and the
Agent is given notice thereof.
5 INTEREST; INCREASED COSTS; TAXES; ETC.
5.1 EURODOLLAR RATE LOANS.
Anything in this Agreement to the contrary notwithstanding:
(a) If any Lender shall notify the Agent that the
introduction of or any change in or in the interpretation of any
law or regulation makes it unlawful, or that any central bank or
other Governmental Authority asserts that it is unlawful, for
such Lender to perform its obligations to make Eurodollar Rate
Loans or to fund or maintain Eurodollar Rate Loans (whether or
not such assertion carries the force of law), the obligation of
such Lender to make, rollover or to convert Loans into
Eurodollar Rate Loans shall be suspended until the circumstances
causing such suspension no longer exist and the Agent shall have
so notified the Borrower, and the existing Eurodollar Rate Loans
of such Lender shall automatically convert, on and as of the
date of such suspension, into Reference Rate Loans; provided
that each Lender represents and warrants to the Borrower that as
of the later of (i) the Closing Date or (ii) the date on which
it shall have executed an Assignment and Acceptance pursuant to
Section 13.24(a), it has no actual knowledge that it would be
unlawful for such Lender to make Eurodollar Rate Loans as
contemplated.
(b) If the Required Lenders shall, not later than 11:00
a.m. (Denver time) one Business Day before the date of any
requested borrowing consisting of Eurodollar Rate Loans, notify
the Agent that the Eurodollar Rate for Eurodollar Rate Loans
comprising such borrowing will not adequately reflect the cost
to such Required Lenders of making or funding their respective
Eurodollar Rate Loans for such borrowing, the right of the
Borrower to select Eurodollar Rate Loans for such borrowing or
any subsequent borrowing respectively shall be suspended until
the Required Lenders shall notify the Agent that the
circumstances causing such suspension no longer exist, and the
Eurodollar Rate Loans comprising such requested borrowing shall
be Reference Rate Loans.
5.2 INCREASED COSTS.
If, due to either (a) the introduction of or any change in
or in the interpretation of any law or regulation or (b) the
compliance with any guideline or request from any central bank
or other Governmental Authority (whether or not having the force
of law), there shall be any increase in the cost or reduction in
yield or rate of return to any Lender of agreeing to make or
making or maintaining any Eurodollar Rate Loan or maintaining
its Commitment with respect thereto (other than any increase in
income or franchise taxes imposed on it by the jurisdiction
under the laws of which such Lender is organized or the
jurisdiction in which such Lender's relevant office is located),
then the Borrower shall from time to time, upon demand by such
Lender (with a copy of such demand to the Agent), pay to the
Agent for the account of such Lender additional amounts
sufficient to compensate such Lender for such increased cost,
reduction in yield or rate of return, provided however, that
similar compensation is also customarily demanded by such Lender
from other borrowers similarly situated and under similar
circumstances. Any request for payment under this Section 5.2
will be submitted to the Borrower and the Agent by such Lender
identifying with reasonable specificity the basis for and the
amount of such increased cost, and shall be conclusive and
binding for all purposes, absent manifest error.
5.3 FUNDING LOSSES.
The Borrower will indemnify each Lender against, and
reimburse each Lender on demand for, any loss, cost or expense
incurred or sustained by such Lender (including without
limitation, any loss or expense incurred by reason of the
liquidation or redeployment of deposits or other funds acquired
by such Lender to fund or maintain any Loan) as a result of (a)
any payment, conversion, rollover, or prepayment (whether
authorized or required hereunder or otherwise) of all or a
portion of any Loan on a day other than the last day of an
Interest Period for such Loan; (b) any payment, conversion,
rollover or prepayment (whether required hereunder or otherwise)
of such Lender's Loan made after the delivery of a notice of
borrowing delivered pursuant to Section 2.1(j) (whether oral or
written) but before the proposed date for such Eurodollar Rate
Loan if such payment or prepayment prevents the proposed
borrowing from becoming fully effective; (c) after receipt by
the Agent of a notice of borrowing delivered pursuant to
Section 2.1(j), the failure of any Loan to be made or effected
by such Lender due to any condition precedent to a borrowing not
being satisfied or due to any other action or inaction of the
Borrower; or (d) any rescission of a notice of borrowing
delivered pursuant to Section 2.1(j) or a notice of interest
conversion delivered pursuant to Section 3.2. Any Lender
demanding payment under this Section 5.3 shall deliver to the
Borrower and the Agent a statement reasonably setting forth the
amount and manner of determining such loss, cost or expense,
which statement shall be conclusive and binding for all
purposes, absent manifest error. Compensation owing to a Lender
as a result of any such loss, cost or expense resulting from a
payment, prepayment, conversion or rollover of a Eurodollar Rate
Loan shall include without limitation, an amount equal to the
sum of the amount of the interest that, but for such event, such
Lender would have earned for the remainder of the applicable
Interest Period plus any expense or penalty incurred by such
Lender.
5.4 CAPITAL ADEQUACY REQUIREMENTS.
(a) If any Lender shall have determined that the adoption
after the date of this Agreement of any applicable law, rule or
regulation regarding capital adequacy, or any change therein
after the date of this Agreement, or any change in the
interpretation or administration thereof after the date of this
Agreement by any Governmental Authority, central bank or
comparable agency charged with the interpretation or
administration thereof, or compliance by such Lender 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 issued after the date of this Agreement,
affects or would affect the amount of capital required or
expected to be maintained by such Lender or any corporation
controlling such Lender, and that the amount of such capital
requirement is increased, or has or would have the effect of
reducing the rate of return on such Lender's or such
corporation's capital to a level below that which such Lender or
such corporation could have achieved but for such adoption,
change or compliance, in each case as a consequence of its
obligations hereunder (taking into consideration such Lender's
policies with respect to capital adequacy), then the Borrower
shall pay to such Lender such additional amount or amounts as
are reasonably determined by such Lender to be sufficient to
compensate such Lender or such corporation in the light of such
circumstances, provided however, that similar compensation is
also customarily demanded by such Lender from other borrowers
similarly situated and under similar circumstances.
(b) A certificate of such Lender setting forth such amount
or amounts as shall be necessary to compensate such Lender as
specified in Section 5.4(a) above shall be delivered as soon as
practicable to the Borrower and shall be conclusive and binding,
absent manifest error. The Borrower shall pay such Lender the
amount shown as due on any such certificate within fifteen (15)
days after such Lender delivers such certificate. In preparing
such certificate, such Lender may employ such assumptions and
allocations of costs and expenses as it shall in good xxxxx xxxx
reasonable and may use any reasonable averaging and attribution
method.
5.5 TAXES.
(a) Any and all payments by the Borrower hereunder or under
the Notes shall be made free and clear of and without deduction
for any and all present or future taxes, deductions, charges or
withholdings, and all liabilities with respect thereto,
including without limitation, such taxes, deductions, charges,
withholdings or liabilities whatsoever imposed, assessed, levied
or collected by any taxing authority and all (other than to the
extent due to the gross negligence or willful misconduct of any
Lender) interest, penalties, expenses or similar liabilities
with respect thereto ("Taxes"), excluding however, from the
definition of Taxes, in the case of each Lender and the Agent,
taxes imposed on its income (including penalties and interest
payable in respect thereof), 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. If the Borrower shall be required by law
to deduct any Taxes from or in respect of any sum payable
hereunder or under any Note to any Lender or the Agent, (i) the
sum payable shall be increased as may be necessary so that after
making all required deductions (including deductions applicable
to additional sums payable under this Section 5.5) such Lender
or the Agent (as the case may be) receives an amount equal to
the sum it would have received had no such deductions been made
and (ii) the Borrower shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance
with applicable law.
(b) In addition, the Borrower agrees to pay any present or
future stamp or documentary taxes or any other excise or
property taxes, charges or similar levies which arise from any
payment made hereunder or under the Notes or from the execution,
delivery or registration of, or otherwise with respect to, this
Agreement or the Notes (hereinafter included within the
definition of "Taxes").
(c) The Borrower will indemnify each Lender and the Agent
for the full amount of Taxes (including without limitation, any
Taxes imposed by any jurisdiction on amounts payable under this
Section 5.5) paid by such Lender or the Agent (as the case may
be) and any liability arising therefrom or with respect thereto,
whether or not such Taxes were correctly or legally asserted.
This indemnification shall be made within five (5) days from the
date such Lender or the Agent (as the case may be) makes written
demand therefor; provided however, to the extent that any Lender
is reimbursed for any Tax that was incorrectly or illegally
asserted in connection with this Agreement or the Notes, such
Lender shall promptly return to the Borrower the amount of such
reimbursement net of any costs of recovery, together with any
interest that may have been paid by the taxing jurisdiction with
respect thereto, to the extent the Borrower has actually paid
such Lender with respect thereto.
(d) Promptly after the date on which payment of any Taxes
are due pursuant to applicable law, the Borrower will, at the
request of the Agent or any Lender, furnish to the Agent or such
Lender evidence in form and substance satisfactory to the Agent
or such Lender, that the Borrower has met its obligations under
this Section 5.5.
(e) Without prejudice to the survival of any other
agreement of the Borrower, the agreement and obligations of the
Borrower contained in this Section 5.5 shall survive the payment
in full of principal and interest hereunder and under the Notes.
6 FEES.
6.1 NON-USE FEE WITH RESPECT TO ALL COMMITMENTS.
The Borrower agrees to pay to the Agent for distribution to
the Lenders (based on their respective Pro Rata Percentages) a
quarterly non-use fee from the Closing Date to the Maturity
Date, on the daily average unused amount of the Commitments
(accrued on the basis of a 360 day year, and charged for actual
days elapsed). The rate at which the non-use fee is calculated
during any quarter shall be the rate set forth below for the
then applicable Financial Performance Level:
Financial
Performance Level Non-Use Fee Rate
Level 1 0.375%
Xxxxx 0 0.25%
Xxxxx 0 0.25%
Xxxxx 0 0.25%
Xxxxx 0 0.125%
The quarterly non-use fee shall be due and payable in arrears on
the first day of each January, April, July and October hereafter
through the Maturity Date, unless the Borrower has fully
terminated the Commitment in accordance with Section 4.4 and
there are then no outstanding Letter of Credit Obligations. A
pro-rated non-use fee shall also be due and payable on the
Maturity Date and on any date on which the Borrower terminates
the Commitment in full in accordance with Section 4.4. Each
quarterly non-use fee shall be earned as it accrues and, at the
option of the Agent, shall be paid by Agent initiated Loans.
6.2 ADDITIONAL FEES WITH RESPECT TO LC'S.
The Borrower agrees to pay to the Agent for distribution to
the Lenders (based on their respective Pro Rata Percentages) a
quarterly fee in respect of each LC issued hereunder from the
Closing Date to the Maturity Date, on the face amount of such LC
(accrued on the basis of a 360 day year, and charged for actual
days elapsed). The rate at which the LC fee is calculated
during any quarter shall be the rate set forth below for the
then applicable Financial Performance Level:
RATE FOR LC'S
FINANCIAL RATE FOR LC'S EXPIRING EXPIRING MORE THAN 12
PERFORMANCE LEVEL WITHIN 12 MONTHS OF ISSUANCE MONTHS AFTER ISSUANCE
Xxxxx 0 2.0% 2.25%
Xxxxx 0 1.5% 1.75%
Xxxxx 0 1.25% 1.5%
Xxxxx 0 1.0% 1.25%
Xxxxx 0 0.75% 1.0%
The quarterly LC fee shall be due and payable in arrears on the
first day of each January, April, July and October hereafter
through the Maturity Date, unless the Borrower has fully
terminated the Commitment in accordance with Section 4.4 and
there are then no outstanding Letter of Credit Obligations. A
pro-rated LC fee shall also be due and payable on the Maturity
Date and on any date on which the Borrower terminates the
Commitment in full in accordance with Section 4.4. Each
quarterly LC fee shall be earned as it accrues and, at the
option of the Agent, shall be paid by Agent initiated Loans. The
Borrower shall also pay to the Agent for the account of the
Affiliate of the Agent issuing any LC, the normal and customary
processing fees charged by such Affiliate in connection with the
issuance of or drawings under each such LC.
6.3 AGENT'S FEES.
The Borrower agrees to pay to the Agent, in respect of its
administrative duties hereunder, fees in the amounts set forth
in the Agent's Letter. The closing fee, the initial annual
arranger fee and the initial annual audit fee (all as described
therein) shall be due and payable in advance on the date of this
Agreement. The subsequent annual arranger and audit fees shall
be due and payable in advance on each Anniversary Date hereafter
as long as any Liabilities are outstanding under this Agreement.
All of the Agent's fees set forth in the Agent's Letter shall
be fully earned on the dates they become payable and, at the
option of the Agent, shall be paid by Agent initiated Loans. No
Persons other than the Agent shall have any interest in such
Agent's fees.
6.4 FEES NOT INTEREST; NONPAYMENT.
The fees described in this Agreement represent compensation
for services rendered and to be rendered separate and apart from
the lending of money or the provision of credit and do not
constitute compensation for the use, detention, or forbearance of
money The obligation of the Borrower to pay each fee described
herein shall be in addition to, and not in lieu of, the
obligation of the Borrower to pay interest, other fees described
in this Agreement, and expenses otherwise described in this
Agreement. Fees shall be payable when due in Dollars and in
immediately available funds. All fees shall be non-refundable.
7 REPRESENTATIONS AND WARRANTIES.
In order to induce the Agent and the Lenders to enter into
this Agreement, and to induce the Issuer to issue LC's, the
Borrower represents and warrants to the Agent, the Lenders and
the Issuer that the following statements are and, after giving
effect to the Loans, will be, true and correct:
7.1 LITIGATION AND PROCEEDINGS.
Except as set forth on Part 1 of Exhibit 7, no judgments are
outstanding against the Borrower, nor is there now pending or
threatened any litigation, contested claim, or governmental
proceeding by or against the Borrower, except for judgments and
pending or threatened litigation, contested claims and
governmental proceedings which are not, in the aggregate,
material to the Borrower's financial condition, results of
operations or business.
7.2 OTHER AGREEMENTS.
Except as set forth on Part 2 of Exhibit 7, the Borrower is
not in default under any contract, lease or commitment to which
the Borrower is a party or by which the Borrower is bound except
for contracts, leases or commitments which are not, in the
aggregate, material to the Borrower's financial condition,
results of operations or business. The Borrower knows of no
dispute, except as set forth on Part 2 of Exhibit 7 or as
previously disclosed to the Agent and the Lenders in writing,
relating to any contract, lease, or commitment which is material
to the continued financial success and well-being of the
Borrower.
7.3 LICENSES, PATENTS, ETC.
All of the Borrower's licenses, patents, copyrights,
trademarks and trade names and all of the Borrower's applications
for any of the foregoing are set forth on Part 3 of Exhibit 7.
There is no action, proceeding, claim or complaint pending or
threatened to be brought against the Borrower by any Person which
might jeopardize any of the Borrower's interest in any of the
foregoing licenses, patents, copyrights, trademarks, trade names
or applications.
7.4 TITLE TO ASSETS.
Except as permitted by Section 10.1 or elsewhere in this
Agreement and except as set forth on Part 4 of Exhibit 7, the
Borrower owns all of its assets free and clear of all security
interests, liens, claims, and encumbrances.
7.5 TAX LIABILITIES.
Except for taxes as to which the amount, applicability or
validity is being contested in good faith by appropriate
proceedings diligently conducted by or on behalf of the Borrower
and, if required under GAAP, as to which the Borrower shall have
set up adequate reserves therefor, the Borrower has filed all
federal, state and local tax reports and returns required by any
law or regulation to be filed by the Borrower and except as
described on Part 5 of Exhibit 7, has either duly paid all taxes,
duties and charges indicated to be due on the basis of such
returns and reports or has made adequate provision for the
payment thereof, and the assessment of any material amount of
additional taxes in excess of those paid and reported is not
expected. The reserves for taxes reflected on the Borrower's
balance sheet are adequate in amount for the payment of all
liabilities for all taxes (whether or not disputed) of the
Borrower accrued through the date of such balance sheet. There
are no material unresolved questions or claims concerning any tax
liability of the Borrower, except as described on Part 5 of
Exhibit 7.
7.6 INDEBTEDNESS.
Except (i) for the Loans and the LC's, (ii) as disclosed on
Part 6 of Exhibit 7; and (iii) as disclosed on the financial
statements identified in Section 7.15 of this Agreement, the
Borrower has no other indebtedness, contingent obligations or
liabilities, outstanding bonds, letters of credit or acceptances
to any other Person or loan commitments from any other Person.
7.7 OTHER NAMES.
The Borrower has not, during the preceding five (5) years,
been known by or used any other name, except as disclosed on Part
7 of Exhibit 7.
7.8 AFFILIATES.
The Borrower has no Affiliates, other than those Persons
disclosed on Part 8 of Exhibit 7, and the legal relationships of
the Borrower to each such Affiliate are accurately and completely
described thereon.
7.9 ENVIRONMENTAL MATTERS.
(a) Except as disclosed on Part 9 of Exhibit 7, the Borrower
has not received any notice to the effect, or has any knowledge,
that its operations are not in compliance with any of the
requirements of applicable federal, state and local
environmental, health and safety statutes and regulations
("Environmental Laws") or are the subject of any federal or state
investigation evaluating whether any remedial action is needed to
respond to a release of any toxic or hazardous waste or substance
into the environment, which non-compliance or remedial action
could have a material adverse effect on the business, operations,
assets or condition (financial or otherwise) of the Borrower; (b)
there have been no releases of hazardous materials at, on or
under the Borrower's premises that, singly or in the aggregate,
have, or may reasonably be expected to have, a material adverse
effect on the financial condition, operations, assets, business
or prospects of the Borrower; (c) there are no underground
storage tanks, active or abandoned, including petroleum storage
tanks, on or under the Borrower's premises that, singly or in the
aggregate, have, or may reasonably be expected to have, a
material adverse effect on the financial condition, operations,
assets, business or prospects of the Borrower; (d) the Borrower
has not directly transported or directly arranged for the
transportation of any hazardous material to any location which is
listed or proposed for listing on the National Priorities List
pursuant to CERCLA, on the CERCLIS or on any similar state list
or which is the subject of federal, state or local enforcement
actions or other investigations which may lead to material claims
against the Borrower for any remedial work, damage to natural
resources or personal injury, including claims under CERCLA; and
(e) except as disclosed on Part 9 of Exhibit 7, no conditions
exist at, on or under the Borrower's premises which, with the
passage of time, or the giving of notice or both, would rise to
any material liability under any Environmental Laws.
7.10 BANK ACCOUNTS.
Part 10 of Exhibit 7 sets forth, as of the Closing Date, the
account numbers and location of all bank accounts (including
lockbox accounts) of the Borrower.
7.11 INTENTIONALLY OMITTED.
7.12 EXISTENCE.
Xxxxxxxxxx is a corporation duly organized, in existence and
in good standing under the laws of the State of Delaware and is
duly licensed to do business in all states where the nature and
extent of the business transacted by it or the ownership of its
assets makes such licensing necessary, except for those
jurisdictions in which the failure to be so licensed would not,
in the aggregate, have a material adverse effect on the
Borrower's financial condition, results of operations or
business. Sunshine is a corporation duly organized, in
existence and in good standing under the laws of the State of
Texas and is duly licensed to do business in all states where
the nature and extent of the business transacted by it or the
ownership of its assets makes such licensing necessary, except
for those jurisdictions in which the failure to be so licensed
would not, in the aggregate, have a material adverse effect on
the Borrower's financial condition, results of operations or
business. Quantz is a corporation duly organized, in existence
and in good standing under the laws of the State of Delaware and
is duly licensed to do business in all states where the nature
and extent of the business transacted by it or the ownership of
its assets makes such licensing necessary, except for those
jurisdictions in which the failure to be so licensed would not,
in the aggregate, have a material adverse effect on the
Borrower's financial condition, results of operations or
business. JBS is a corporation duly organized, in existence
and in good standing under the laws of Barbados and is duly
licensed to do business in all jurisdictions where the nature and
extent of the business transacted by it or the ownership of its
assets makes such licensing necessary, except for those
jurisdictions in which the failure to be so licensed would not,
in the aggregate, have a material adverse effect on the
Borrower's financial condition, results of operations or
business.
7.13 AUTHORITY.
The execution and delivery by the Borrower of this Agreement
and all of the other Financing Agreements and the performance of
the Borrower's obligations hereunder and thereunder (a) are
within the Borrower's corporate powers; (b) are duly authorized
by the Borrower's board of directors and, if necessary, the
Borrower's shareholders; (c) are not in contravention of any law
or laws, or the terms of the Borrower's articles or certificates
of incorporation or by-laws, or of any indenture, agreement or
undertaking to which the Borrower is a party or by which the
Borrower or any of the Borrower's property is bound, or of any
other agreement, instrument or document relating to the
Borrower's governance; (d) do not require any governmental
consent, registration or approval; (e) do not contravene any
contractual or governmental restriction binding upon the Borrower
for which a consent has not been obtained; and (f) will not,
except as contemplated or permitted by this Agreement, result in
the imposition of any lien, charge, security interest or encum-
brance upon any property of the Borrower under any existing
indenture, mortgage, deed of trust, loan or credit agreement or
other material agreement or instrument to which the Borrower is a
party or by which the Borrower or any of the Borrower's property
may be bound or affected.
7.14 DUE EXECUTION; BINDING EFFECT.
This Agreement and all of the other Financing Agreements
proposed to be executed and delivered as of the Closing Date have
been duly executed by the Borrower and set forth the legal, valid
and binding obligations of the Borrower and are enforceable
against the Borrower in accordance with their respective terms,
except as such enforcement may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors' rights generally, and except as such
enforcement may be limited by general principles of equity.
7.15 CORRECTNESS OF FINANCIAL STATEMENTS.
The financial statements delivered by the Borrower to the
Agent and the Lenders present fairly the financial condition of
the Borrower as of the dates thereof and for the periods covered
thereby, and have been prepared in accordance with GAAP consis-
tently applied. As of the date of such financial statements, and
since such date, there has been no materially adverse change in
the condition or operation of the Borrower, nor has the Borrower
mortgaged, pledged or granted a security interest in or
encumbered any of the Borrower's assets or properties since such
date.
7.16 EMPLOYEE CONTROVERSIES.
There are no controversies pending or threatened between the
Borrower or any of the Borrower's employees, other than employee
grievances arising in the ordinary course of the Borrower's
business which are not, in the aggregate, material to the
continued financial success and well-being of the Borrower.
7.17 COMPLIANCE WITH LAWS AND REGULATIONS.
The Borrower is in compliance with all laws, orders,
regulations and ordinances of all federal, foreign, state and
local governmental authorities relating to the business
operations and the assets of the Borrower, except for laws,
orders, regulations and ordinances, the violation of which, in
the aggregate, would not have a material adverse effect on the
Borrower's financial condition, results of operations or
business.
7.18 SOLVENCY.
The Borrower is solvent, able to pay the Borrower's debts
generally as such debts mature, and has capital sufficient to
carry on the Borrower's business and all businesses in which the
Borrower is about to engage. The saleable value of the
Borrower's total assets at a fair valuation, and at a present
fair saleable value, is greater than the amount of the Borrower's
total obligations to all Persons. The Borrower will not be
rendered insolvent by the execution or delivery of this Agreement
or of any of the other Financing Agreements or by the
transactions contemplated hereunder or thereunder.
7.19 PENSION REFORM ACT.
No events, including without limitation, any "Reportable
Event" or "Prohibited Transactions," as those terms are defined
in ERISA have occurred in connection with any Pension Plan of the
Borrower which might constitute grounds for the termination of
any such Pension Plan by the Pension Benefit Guaranty Corporation
or for the appointment by the appropriate United States District
Court of a trustee to administer any such Pension Plan. All of
the Borrower's Pension Plans meet the minimum funding standards
of Section 302 of ERISA.
7.20 MARGIN SECURITY.
The Borrower does not own any margin security and none of
the Loans shall be used for the purpose of purchasing or carrying
any margin securities or for the purpose of reducing or retiring
any indebtedness which was originally incurred to purchase any
margin securities or for any other purpose not permitted by
Regulations G, T, U or X of the Board of Governors of the Federal
Reserve System.
7.21 CONFLICTING OR ADVERSE AGREEMENTS OR RESTRICTIONS.
The Borrower is not a party to any contract or agreement or
subject to any restriction which restricts the conduct of its
business which could have a material adverse effect on the
financial condition, operations, assets, business or prospects
of the Borrower. The Borrower is not in default under or in
violation of any Governmental Requirement related to the Loans or
any other Governmental Requirement which default could have a
material adverse effect on the financial condition, operations,
assets, business or prospects of the Borrower. Neither the
execution and delivery of the Financing Agreements nor the
consummation of the transactions contemplated thereby, nor
fulfillment of and compliance with the respective terms,
conditions and provisions thereof, will conflict with or result
in a breach of any of the terms, conditions or provisions of, or
constitute a default under, or result in any violation of, or
result in the creation or imposition of any lien or security
interest on any of the Borrower's assets pursuant to: (a) the
charter or bylaws of the Borrower; (b) any Governmental
Requirement; (c) any order, writ, injunction or decree of any
court; or (d) the terms, conditions or provisions of any material
agreement or instrument to which the Borrower is a party or by
which it or its property is bound or to which it or its property
is subject in any material respect, except such agreements or
instruments as to which a consent has been obtained.
7.22 INVESTMENT COMPANY ACT NOT APPLICABLE.
The Borrower is not an "investment company", or a company
"controlled" by an "investment company", within the meaning of
the Investment Company Act of 1940, as amended.
7.23 PUBLIC UTILITY HOLDING COMPANY ACT NOT APPLICABLE.
The Borrower is not a "holding company", or a "subsidiary
company" of a "holding company", or an "affiliate" of a "holding
company", or an affiliate of a "subsidiary company" of a "holding
company", or a "public utility", as such terms are defined in the
Public Utility Holding Company Act of 1935, as amended.
7.24 NO CONSENT.
The execution, delivery and performance by the Borrower of,
and the effectuation of the transactions contemplated under, this
Agreement, the Notes and the other Financing Agreements, and the
borrowings hereunder by the Borrower as contemplated herein, do
not require the consent or approval of any other Person, except
such consents or approvals as have been obtained. The Borrower
has not otherwise failed to obtain any material governmental
consent, approval, license, permit, franchise or other
governmental authorization necessary to the ownership of any of
its properties or the conduct of its business.
7.25 FULL DISCLOSURE.
All factual information taken as a whole in the materials
furnished by or on behalf of the Borrower to the Agent or any
Lender for purposes of or in connection with the transactions
contemplated under this Agreement and the other Financing
Agreements, does not contain any untrue statement of a material
fact or omit to state any material fact necessary to keep the
statements contained therein from being misleading as of the date
of this Agreement. The financial projections and other financial
information furnished to the Agent or any Lender by the Borrower
and to be delivered under Section 9.1 of this Agreement, were
prepared in good faith on the basis of information and
assumptions that the Borrower believes to be reasonable as of the
date of such information, provided however, that the Agent and
the Lenders acknowledge that financial projections are not a
guaranty of future results.
7.26 INTELLECTUAL PROPERTY.
The Borrower owns or possesses (or will be licensed or
otherwise have the full right to use) all intellectual property
which is necessary for the operation of its business, without any
known conflict with the rights of others. No product of the
Borrower infringes upon any intellectual property owned by any
other Person and no claim or litigation is pending or (to the
knowledge of the Borrower) threatened against or affecting such
Person, contesting its right to sell or to use any product or
material, in any case which could have a material adverse effect
on the financial condition, operations, assets, business or
prospects of the Borrower. There is no violation by the Borrower
of any right of the Borrower with respect to any material patent,
trademark, trade name, service xxxx, copyright or license owned
or used by the Borrower.
7.27 BAINBRIDGE WARRANTIES.
The Bainbridge Bonds have not been redeemed in whole or in
part. All sinking fund payments required to be made in
connection with the Bainbridge Bonds through the date of this
Agreement have been made. There are no Bainbridge Bonds held by
or for the account of the Borrower or for the account of
Xxxxxxxxxx.
7.28 SURVIVAL OF WARRANTIES.
All representations and warranties contained in this
Agreement or any of the other Financing Agreements shall survive
the execution and delivery of this Agreement and shall be true
from the date of this Agreement until the Liabilities shall be
paid in full and the Commitments have been fully terminated in
accordance with the provisions of this Agreement.
8 CONDITIONS.
8.1 CONDITIONS PRECEDENT TO ALL LOANS.
The obligations of each Lender to advance its Pro Rata
Percentage of any Loan and the obligation of the Agent to issue
or cause to be issued any LC's are subject to the satisfaction of
the following conditions precedent:
(a) Documents.
The Borrower shall have executed and/or delivered to
the Agent, appropriately dated and in form and substance
satisfactory to the Agent, together with original counterparts or
copies for each Lender, as the case may be, all of the documents
listed on Part A of the List of Closing Documents attached as
Exhibit 8A.
(b) Actions and Events.
(i Payment of Expenses.
There shall have been paid all fees due on the Closing
Date and all fees and expenses of or incurred by the Agent and
its counsel to the extent billed as of the Closing Date and
payable pursuant to this Agreement.
(ii Insurance.
The Agent shall have received evidence satisfactory to
the Agent that the Borrower has insurance meeting the
requirements of Sections 9.4 and 9.5.
(iii No Prohibitions.
No law or regulation shall prohibit, and no order,
judgment or decree of any Governmental Authority shall prohibit,
and no litigation shall be pending or threatened which would
enjoin, prohibit, restrain or otherwise adversely affect the
consummation of the transactions contemplated under the Financing
Agreements, or which would otherwise have a material adverse
effect on the Borrower's financial condition, results of
operations or business.
(iv Material Adverse Change.
No material adverse change shall have occurred with
respect to the financial condition, business, operations or
prospects of the Borrower since the dates of the most recent
financial statement delivered to the Agent and the Lenders.
(v) Prior Indebtedness.
The Agent shall have received evidence or assurances
satisfactory to the Agent that any prior indebtedness listed on
Exhibit 8B shall be paid in full on or before the Closing Date or
concurrently with and from the proceeds of the initial Loan, and
that any liens, encumbrances or security interests securing such
prior indebtedness shall be released of record or assigned to the
Agent substantially contemporaneously with the Closing Date.
(vi Wiring Instructions.
The Agent shall have received wiring instructions with
respect to the proceeds of the initial Loan.
(vii Other Actions and Documents.
The Borrower shall have taken such actions, and the
Agent shall have received such other documents, as the Agent may
reasonably request.
(viii Approval of the Agent's Counsel.
Legal matters, if any, relating to the Loans to be made
on the Closing Date shall have been reviewed by and shall be
satisfactory to counsel for the Agent.
(ix Compliance.
All representations and warranties contained in this
Agreement shall be true and correct in all material respects as
though made on and as of any date the Borrower requests any Loan
to be made and on and as of the date of such Loan.
(x) Budgets.
The Borrower shall have delivered to the Agent annual
operating and capital budgets through the Borrower's 1998 Fiscal
Year, which budgets shall be satisfactory in form and substance
to the Agent.
(xi) Licenses and Permits.
The Agent shall have received evidence satisfactory to
the Agent that the Borrower has all necessary licenses and
permits for the operation of its business.
8.2 ADDITIONAL CONDITIONS PRECEDENT TO ISSUANCE OF
XXXXXXXXXX XX.
The obligation of the Agent to issue or cause to be issued
any Xxxxxxxxxx XX is subject to the satisfaction of the following
conditions precedent, in addition to those set forth in
Section 8.1:
(a) Documents.
The Borrower shall have executed and/or delivered to
the Agent, appropriately dated and in form and substance
satisfactory to the Agent, together with original counterparts or
copies for each Lender, as the case may be, all of the documents
listed on Part B of the List of Closing Documents attached as
Exhibit 8A.
(b) Actions and Events.
(i Payment of Expenses.
There shall have been paid all fees due in connection
with the issuance of such Xxxxxxxxxx XX.
(ii No Prohibitions.
No law or regulation shall prohibit, and no order,
judgment or decree of any Governmental Authority shall prohibit,
and no litigation shall be pending or threatened which would
enjoin, prohibit, restrain or otherwise adversely affect the
issuance of the Xxxxxxxxxx XX.
(iii Other Actions and Documents.
The Borrower shall have taken such actions, and the
Agent shall have received such other documents, as the Agent may
reasonably request.
(iv Approval of the Agent's Counsel.
Legal matters, if any, relating to the Xxxxxxxxxx XX
shall have been reviewed by and shall be satisfactory to counsel
for the Agent.
9. AFFIRMATIVE COVENANTS.
The Borrower covenants and agrees that until the Liabilities
are paid in full and the Commitments, the LC's and all other
obligations of the Lenders and the Issuer are finally terminated,
the Borrower will:
9. 1. FINANCIAL STATEMENTS AND OTHER INFORMATION.
Except as otherwise expressly provided for in this
Agreement, the Borrower shall keep proper books of record and
account in which full and true entries will be made of all
dealings and transactions of or in relation to the business and
affairs of the Borrower, in accordance with GAAP consistently
applied, and the Borrower shall cause to be furnished to the
Agent and the Lenders, from time to time and in a form acceptable
to the Agent, such information as the Agent may reasonably
request, including without limitation, the following:
(a) as soon as practicable and in any event within one
hundred twenty (120) days after the end of each Fiscal Year of
the Borrower: (i) audited consolidated statements of income,
retained earnings and changes in the financial condition of
Xxxxxxxxxx for each year, and a consolidated balance sheet of
Xxxxxxxxxx for such year, setting forth in each case, in compara-
tive form, corresponding figures as of the end of the preceding
Fiscal Year, all in reasonable detail and satisfactory in scope
to the Agent and certified to the Borrower by Price Waterhouse
LLP or such other independent public accountants as are selected
by the Borrower and are reasonably satisfactory to the Agent,
whose opinion shall be unqualified, and (ii) a compliance
certificate of the chief financial officer of the Borrower in the
form attached as Exhibit 9A;
(b) as soon as practicable and in any event within sixty
(60) days after the end of each Fiscal Year of the Borrower:
operating and capital budgets for the next Fiscal Year;
(c) as soon as practicable and in any event within thirty
(30) days after the end of each monthly accounting period in each
Fiscal Year of the Borrower: (i) consolidated statements of
income and retained earnings of Xxxxxxxxxx for such monthly
period and for the period from the beginning of the then current
Fiscal Year to the end of such monthly period, and a consolidated
balance sheet of Xxxxxxxxxx as of the end of such monthly period,
setting forth in each case, in comparative form, figures for the
corresponding periods in the preceding Fiscal Year, all in
reasonable detail and certified as accurate by the chief
financial officer of the Borrower, subject to changes resulting
from normal year-end adjustments, (ii) copies of all operating
statements for such month prepared by the Borrower for its
internal use, including without limitation, statements of cash
flow, and (iii) a compliance certificate of the chief financial
officer of the Borrower in the form attached as Exhibit 9A; and
(d) as soon as distributed, copies of all financial reports
and filings submitted to Governmental Authorities, including
without limitation, copies of all Securities and Exchange
Commission Forms 10K and 10Q
9. 2. CONDUCT OF BUSINESS.
Except as contemplated by this Agreement, the Borrower
shall: (a) maintain the Borrower's corporate existence and
maintain in full force and effect all licenses, bonds,
franchises, leases, patents, contracts and other rights necessary
or desirable to the profitable conduct of the Borrower's
business; (b) continue in, and limit the Borrower's operations
to, the same general line of business as that presently conducted
by the Borrower; (c) comply with all applicable laws and
regulations of any federal, state or local governmental
authority, except for such laws and regulations the violation of
which would not, in the aggregate, have a material adverse effect
on the Borrower's financial condition, results of operations or
business; and (d) keep and conduct the Borrower's business
separate and apart from the business of the Borrower's
Affiliates.
9. 3. MAINTENANCE OF PROPERTIES.
The Borrower shall keep the Borrower's real estate,
leaseholds, equipment and other fixed assets in good condition,
repair and working order, normal wear and tear excepted.
9. 4. LIABILITY INSURANCE.
The Borrower shall maintain, at the Borrower's expense, such
public liability and property damage insurance as is ordinarily
maintained by other companies in similar businesses, provided
however, that in no event shall such public liability insurance
provide for coverage less than $2,000,000 per occurrence for
personal injury and $2,000,000 per occurrence for property
damage. The Borrower's public liability insurance may provide
for a deductible of not more than $10,000 per occurrence. All
such policies of insurance shall be in form and with insurers
reasonably acceptable to the Agent and copies thereof, together
with all amendments and schedules thereto, shall be provided to
the Agent within ten (10) days of receipt thereof.
9. 5. PROPERTY INSURANCE.
At the Borrower's own cost and expense, the Borrower shall
keep all of its assets fully insured, with carriers, and in
amounts acceptable to the Agent, against the hazards of fire,
theft, collision, spoilage, hail, those covered by extended or
all risk coverage insurance and such others as may be required by
the Agent. The Borrower shall cause to be delivered to the Agent
the insurance policies therefor or proper certificates evidencing
the same. Each such policy shall include a provision for thirty
(30) days' prior written notice to the Agent of any cancellation
or expiration thereof. If the Borrower fails to procure insurance
as provided in this Agreement, or to keep the same in force, then
the Agent may, at the Agent's option, and without obligation to
do so, obtain such insurance and pay the premium thereon for the
account of the Borrower, or make whatever other payments the
Agent may deem. Any such payments shall be additional
Liabilities of the Borrower to the Lenders, payable on demand.
9. 6. FINANCIAL COVENANTS AND RATIOS.
The Borrower shall maintain: (a) Tangible Net Worth as of
the end of each month of not less than $55,000,000, plus for each
Fiscal Year beginning with the Borrower's 1999 Fiscal Year, 50%
of the Borrower's positive net income during the previous Fiscal
Year; (b) a Working Capital Ratio as of the end of each month of
not less than 1.5 to 1.0; (c) as of the end of each fiscal
quarter for the four fiscal quarters then ending, EBITDA of not
less than $16,500,000 through the end of the Borrower's 1998
Fiscal Year and not less than $20,000,000 thereafter; and
(d) Working Capital as of the end of each month of not less than
$40,000,000.
9. 7. PENSION PLANS.
The Borrower shall: (a) keep in full force and effect any
and all Pension Plans which are presently in existence or may,
from time to time, come into existence under ERISA, unless such
Pension Plans can be terminated without material liability to the
Borrower in connection with such termination (as distinguished
from any continuing funding obligation); (b) make contributions
to all of the Borrower's Pension Plans in a timely manner and in
an amount sufficient to comply with the requirements of ERISA;
(c) comply with all requirements of ERISA which relate to such
Pension Plans; (d) notify the Agent immediately upon receipt by
the Borrower of any notice of the institution of any proceeding
or other action which may result in the termination of any
Pension Plans; and (e) acquire and maintain, when available, the
contingent employer liability coverage insurance provided for
under Section 4023 of ERISA, such insurance to be satisfactory to
the Agent in coverage and amount.
9. 8. NOTICE OF SUIT, ADVERSE CHANGE OR DEFAULT.
The Borrower shall, as soon as possible, and in any event
within five (5) days after the Borrower learns of the following,
give written notice to the Agent of (a) any proceeding being
instituted or threatened to be instituted by or against the
Borrower in any federal, state, local or foreign court or before
any commission or other regulatory body (federal, state, local or
foreign) for which claimed damages exceed $1,000,000; (b) any
material adverse change in the business, assets or condition,
financial or otherwise, of the Borrower; and (c) the occurrence
of any Default.
9. 9. USE OF PROCEEDS.
The Borrower shall use the Loans only for the purposes set
forth in this Agreement.
9. 10. BOOKS AND RECORDS; SEPARATE EXISTENCE.
The Borrower shall maintain proper books of record and
account in accordance with GAAP consistently applied in which
true, full and correct entries will be made of all their
respective dealings and business affairs. If any changes in
accounting principles from those used in the preparation of the
financial statements referenced in Section 7.15 are hereafter
required or permitted by GAAP and are adopted by the Borrower
with the concurrence of its independent certified public accounts
and such changes in GAAP result in a change in the method of
calculation or the interpretation of any of the financial
covenants, standards or terms found in Section 9.6 or any other
provision of this Agreement, the Borrower and the Required
Lenders agree to amend any such affected terms and provisions so
as to reflect such changes in GAAP with the result that the
criteria for evaluating the Borrower's financial condition shall
be the same after such changes in GAAP as if such changes in GAAP
had not been made. Borrower shall do all things necessary to
maintain the separate corporate existence of each of Xxxxxxxxxx,
Sunshine, Quantz and JBS.
9. 11. LAWS AND OBLIGATIONS.
The Borrower shall comply with all Governmental Requirements
in all material respects; and pay all taxes, assessments,
governmental charges, claims for labor, supplies and rent,
including without limitation, taxes, assessments, governmental
charges, claims for labor, supplies and rent imposed upon or
against or with respect to the ownership, use, occupancy or
enjoyment of any real property owned by the Borrower, or any
utility service thereon; provided however, that the Borrower
shall not be required to pay any ad valorem or other real
property taxes up to an aggregate amount at any time of
$1,000,000 or any other taxes, assessments, governmental charges
or claims if, in either case, the amount, applicability or
validity thereof shall currently be contested in good faith by
appropriate proceedings diligently conducted by or on behalf of
the Borrower and, if required under GAAP, the Borrower shall have
set up adequate reserves therefor; provided further, that, with
respect to such other taxes, assessments, governmental charges or
claims, no lien has been filed by the United States or any state
or other political subdivision thereof which could have priority
over any liens and security interests granted to the Agent
pursuant to the Financing Agreements.
9. 12. ENVIRONMENTAL LAWS.
The Borrower shall at all times:
(a use and operate all of its businesses and Properties in
compliance in all material respects with all environmental laws;
keep all necessary permits relating to environmental and safety
and health matters in effect and remain in compliance in all
material respects therewith; handle all hazardous materials in
compliance in all material respects with all applicable
environmental laws; and dispose of all hazardous materials
generated by the Borrower or at any property owned or leased by
the Borrower at facilities or with carriers that maintain valid
permits for such disposal or transportation under applicable
environmental laws;
(b promptly notify the Agent (and provide copies upon
receipt) of all material claims, complaints, notices or inquiries
relating to the environmental condition of the facilities and
properties of the Borrower or its compliance with environmental
laws; and
(c provide such other information and certifications which
the Lenders may reasonably request from time to time to evidence
compliance with this Section 9.12.
9. 13. TRADE ACCOUNTS PAYABLE.
The Borrower shall pay all trade accounts payable on a basis
not more than sixty (60) days past due the amount, except for
those being contested in good faith by appropriate proceedings
diligently conducted by or on behalf of the Borrower and, if
required under GAAP, as to which the Borrower shall have set up
adequate reserves therefor.
9. 14. COMPLIANCE WITH FEDERAL FOOD SECURITY ACT.
The Borrower shall take all such actions as may be necessary
to insure that they purchase all farm products (as defined in 7
USCA 1631(c)(5)) free and clear of all liens, claims, security
interests and encumbrances, including the security interests of
secured parties of the sellers of such farm products other than
such liens, claims, security interests or encumbrances permitted
under Section 10.1 of this Agreement.
9. 15. ACCESS TO ACCOUNTANTS.
The Borrower authorizes its independent public accountants
to discuss the financial condition of the Borrower with the
Lenders after reasonable notice to the Borrower of their
intention to do so. Prior to such discussions, the Borrower shall
be given the reasonable opportunity to participate in any such
discussion. The Borrower shall deliver a letter to such
accountants authorizing them to comply with the provisions of
this Section 9.15.
9. 16. BAINBRIDGE COVENANTS.
The Borrower shall keep, observe and perform all of its
obligations pursuant to the Bainbridge Loan Documents and the
Bainbridge Bond Documents to which the Borrower or Xxxxxxxxxx is
a party.
10. NEGATIVE COVENANTS.
The Borrower covenants and agrees that until the Liabilities
are paid in full and the Commitments, the LC's and all other
obligations of the Lenders and the Issuer are finally terminated,
the Borrower will not:
10.1 ENCUMBRANCES.
Except for those liens, security interests and encumbrances
presently in existence and reflected in the Borrower's financial
statements referred to in Section 7.15 and permitted under
Section 7.4, the Borrower shall not create, incur, assume or
suffer to exist any security interest, mortgage, pledge, lien,
levy, assessment, attachment, seizure, writ, distress warrant, or
other encumbrance of any nature whatsoever on or with regard to
any of the Borrower's assets other than: (a) liens securing the
payment of taxes, either not yet due or the validity of which is
being contested in good faith by appropriate proceedings, and as
to which the Borrower shall, if appropriate under GAAP, have set
aside on the Borrower's books and records adequate reserves; (b)
liens securing deposits under workmen's compensation,
unemployment insurance, social security and other similar laws,
or securing the performance of bids, tenders, contracts (other
than for the repayment of borrowed money) or leases, or securing
indemnity, performance or other similar bonds for the performance
of bids, tenders, contracts (other than for the repayment of
borrowed money) or leases, or securing statutory obligations or
surety or appeal bonds, or securing indemnity, performance or
other similar bonds in the ordinary course of the Borrower's
business; (c) [intentionally omitted]; (d) zoning restrictions,
easements, licenses, covenants and other restrictions affecting
the use of the Borrower's real property, and other liens,
security interests and encumbrances on property which are
subordinate to any liens and security interests of the Agent and
which do not, in the Agent's reasonable determination (i)
materially impair the use of such property or (ii) materially
lessen the value of such property for the purposes for which the
same is held by the Borrower; (e) [intentionally omitted]; (f)
purchase money security interests securing indebtedness permitted
to be incurred under Section 10.4(d); and (g) any liens, security
interests or other encumbrances in favor of the Agent for the
ratable benefit of the Lenders and liens, security interests and
other encumbrances existing by operation of law in favor of any
Lender and securing the Liabilities.
10.2. CONSOLIDATIONS, MERGERS OR ACQUISITIONS.
The Borrower shall not without the prior written consent of
the Required Lenders, recapitalize or consolidate with, merge
with, or otherwise acquire all or substantially all of the assets
or properties of any other Person. Xxxxxxxxxx shall not have any
subsidiaries other than Sunshine, JBS and Quantz, and Sunshine,
JBS and Quantz shall not have any subsidiaries.
10.3. DEPOSITS, INVESTMENTS, ADVANCES OR LOANS.
The Borrower shall not make or permit to exist deposits,
investments, advances or loans (other than loans existing on the
date of the execution of this Agreement and disclosed to the
Lenders in writing on or prior to such date) in or to Affiliates
or any other Person, except: (a) investments in short-term
direct obligations of the United States Government; (b)
investments in negotiable certificates of deposit issued by a
bank satisfactory to the Agent in the Agent's reasonable
determination, made payable to the order of the Borrower or to
bearer; (c) loans to officers, directors, partners, employees or
Affiliates as and when permitted by Section 10.9 of this
Agreement; and (d) demand deposits held by a bank satisfactory to
the Agent in the Agent's reasonable discretion. Without limiting
the generality of the foregoing, the Borrower shall not make or
permit to exist deposits or investments in Margin Accounts.
10.4. INDEBTEDNESS.
Except for those obligations and that indebtedness presently
in existence and reflected in the Borrower's financial statements
referred to in Section 7.15 or referred to in Section 7.6, the
Borrower shall not incur, create, assume, become or be liable in
any manner with respect to, or permit to exist, any obligations
or indebtedness, direct or indirect, fixed or contingent, except:
(a) the Liabilities; (b) obligations secured by liens or
security interests permitted under Section 10.1 or contingent
obligations permitted under Section 10.5; (c) trade obligations
and normal accruals in the ordinary course of the Borrower's
business not yet due and payable, or with respect to which the
Borrower is contesting in good faith the amount or validity
thereof by appropriate proceedings, and then only to the extent
that the Borrower has set aside on the Borrower's books adequate
reserves therefor, if appropriate under GAAP; (d) other
indebtedness secured by liens permitted under clause (f) of
Section 10.1, not exceeding $1,500,000 in the aggregate during
any one Fiscal Year; and (e) other unsecured indebtedness not
exceeding the following amount: $3,750,000 less the amount of
indebtedness incurred under the preceding clause (d) of this
Section 10.4.
10.5. GUARANTEES AND OTHER CONTINGENT OBLIGATIONS.
The Borrower shall not guarantee, endorse or otherwise in
any way become or be responsible for obligations of any other
Person, whether by agreement to purchase the indebtedness of such
Person or through the purchase of goods, supplies or services, or
maintenance of working capital or other balance sheet covenants
or conditions, or by way of stock purchase, capital contribution,
advance or loan for the purpose of paying or discharging any
indebtedness or obligation of such Person or otherwise, except:
(a) for endorsements of negotiable instruments for collection in
the ordinary course of business; (b) that the Borrower may
indemnify the Borrower's officers and directors to the extent
permitted under the laws of the State in which the Borrower is
organized; (c) guaranties and other contingent obligations not
exceeding $1,000,000 in the aggregate during any one Fiscal Year;
and (d) guaranties by Xxxxxxxxxx'x subsidiaries of the Prudential
Notes and the Teachers Notes.
10.6. DISPOSITION OF PROPERTY.
The Borrower shall not sell, lease, transfer or otherwise
dispose of any of the Borrower's properties, assets or rights, to
any Person, except (a) in the ordinary course of the Borrower's
business; (b) as permitted in the Financing Agreements; or (c)
sales of obsolete, worn out or unusable assets.
10.7. CAPITAL INVESTMENT LIMITATIONS.
The Borrower shall not make any Capital Expenditures at any
time when there exists a Default or a Matured Default or if such
Capital Expenditure would result in a Default or a Matured
Default. At any time when there does not exist a Default or a
Matured Default, the Borrower may make Capital Expenditures in
any Fiscal Year in any amount which does not exceed the greater
of: (a) such amount as will permit the Borrower's Fixed Charge
Coverage Ratio during such Fiscal Year to not be less than 1.0 to
1, or (b) $7,500,000.
10.8. INTENTIONALLY OMITTED.
10.9. LOANS TO AFFILIATES.
The Borrower shall not make any loans to any officers,
directors, Affiliates or shareholders of the Borrower, except for
(a) advances for travel and expenses to the Borrower's officers,
directors or employees in the ordinary course of the Borrower's
business; and (b) loans to the Borrower's officers, directors or
employees not exceeding $500,000 in the aggregate at any one time
outstanding.
10.10. DISTRIBUTIONS, PREPAYMENTS OF DEBT. The Borrower
shall not directly or indirectly: (a) redeem any of the
Borrower's shares of capital stock; (b) declare any dividends in
any year on any class of the Borrower's capital stock, except
that during each Fiscal Year, the Borrower may make, declare and
pay dividends to its shareholders in amounts up to the lesser of
(i) 25% of Xxxxxxxxxx'x consolidated net income during the
previous Fiscal Year, or (ii) $5,000,000; or (c) prepay, redeem,
purchase or deposit funds for the prepayment, redemption or
purchase of any principal, interest or other obligations related
to any indebtedness of the Borrower for borrowed money other than
the Liabilities.
10.11. CHANGE OF CONTROL; AMENDMENT OF ORGANIZATION
DOCUMENTS.
The Borrower shall not enter into any transaction which
would result in the failure of Xxxxxx X. Xxxxxxxxxx and Xxxxxxx
Xxxxxxxxx, their respective immediate family members, and certain
trusts created for the benefit of their respective sons and
daughters to own, in the aggregate, shares of voting stock of
Xxxxxxxxxx, on a fully diluted basis, representing the right to
elect a majority of the directors of Xxxxxxxxxx. The Borrower
shall not enter into any transaction which would result in the
failure of Xxxxxxxxxx to own directly and beneficially, 100% of
the outstanding shares of all classes of common stock of
Sunshine, Quantz and JBS. The Borrower shall not amend the Bor-
rower's articles or certificate of incorporation, bylaws or any
other agreement, instrument or document affecting the Borrower's
organization, management or governance, without the prior written
consent of the Required Lenders, which consent shall not be
unreasonably withheld.
10.12. INTENTIONALLY OMITTED.
10.13. USE OF NAMES.
Except to the extent that Agent has been notified in
advance, the Borrower shall not use any names other than those
referred to in Section 7.7, nor shall the Borrower change any of
said names.
10.14. PAYMENT OF CERTAIN DEBT.
The Borrower shall not directly or indirectly, pay, prepay,
redeem or purchase, or deposit funds or property for the payment,
prepayment, redemption or purchase of the indebtedness of the
Borrower which is subordinated to the payment of any portion of
the Liabilities. The Borrower shall not directly or indirectly,
prepay, redeem or purchase, or deposit funds or property for the
prepayment, redemption or purchase of the Prudential Notes and/or
the Teachers Notes.
10.15. FISCAL YEAR.
The Borrower shall not change its Fiscal Year without the
prior written consent of the Required Lenders.
10.16. AMENDMENT OF BAINBRIDGE BOND DOCUMENTS AND
BAINBRIDGE LOAN DOCUMENTS.
Neither the Borrower nor Xxxxxxxxxx shall amend the
Bainbridge Bond Documents or the Bainbridge Loan Documents
without the prior written consent of the Agent and the Required
Lenders.
11. DEFAULT AND RIGHTS AND REMEDIES OF THE AGENT.
11.1. ACCELERATION.
Upon a Matured Default, the Agent shall promptly give notice
of such Matured Default to the Borrower and each Lender and (a)
with respect to any Matured Default described in clause (h) or
clause (i) of the definition thereof, all of the Liabilities
shall automatically become immediately due and payable and the
obligations of the Lenders to make Loans and the Commitments
shall automatically terminate, without presentment, demand,
protest or further notice (including without limitation, notice
of intent to accelerate and notice of acceleration) of any kind,
all of which are expressly waived by the Borrower; and (b) with
respect to any other Matured Default, the Agent may with the
consent of the Required Lenders, and shall at the request of the
Required Lenders, by notice to the Borrower and the Lenders, (i)
declare the several obligations of the Lenders to make Loans to
be terminated, whereupon such obligations and the Commitments of
each Lender shall forthwith terminate, and (ii) declare all of
the Liabilities to be due and payable, whereupon the Liabilities
shall become and be due and payable, without presentment, demand,
protest or further notice (including without limitation, notice
of intent to accelerate and notice of acceleration) of any kind,
all of which are expressly waived by the Borrower.
11.2. OTHER REMEDIES.
Upon the occurrence and during the continuance of any
Matured Default, the Agent may, with the consent of the Required
Lenders (subject to the provisions of the other Financing
Agreements), and shall at the request of the Required Lenders,
proceed to protect and enforce the rights of the Lenders by suit
in equity, by action at law or both, whether for the specific
performance of any covenant or agreement contained in this
Agreement or in any other Financing Agreement or in aid of the
exercise of any power granted in this Agreement or any other
Financing Agreement, or may proceed to enforce the payment of the
Liabilities, or may proceed to foreclose upon any liens, claims,
security interests and/or encumbrances granted pursuant to the
Financing Agreements in the manner set forth therein, it being
intended that no remedy conferred herein or in any of the other
Financing Agreements is to be exclusive of any other remedy, and
each and every remedy contained herein or in any other Financing
Agreement shall be cumulative and shall be in addition to every
other remedy given hereunder and under the other Financing
Agreements, or at any time existing at law or in equity or by
statute or otherwise.
12. THE AGENT AND THE LENDERS.
12.1. AUTHORIZATION AND ACTION.
Each Lender appoints the Agent as its Agent under, and
irrevocably authorizes the Agent (subject to Section 12.7) to
take such action on its behalf and to exercise such powers under
any Financing Agreement as are delegated to the Agent by the
terms thereof, together with such powers as are reasonably
incidental thereto. Without limiting the generality of the
foregoing, each Lender expressly authorizes the Agent to execute,
deliver, and perform the Agent's obligations under each of the
Financing Agreements to which the Agent is a party, and to
exercise all rights, powers, and remedies that the Agent may have
thereunder. As to any matters not expressly provided for by this
Agreement (including without limitation, enforcement or
collection of the Notes), the Agent shall not be required to
exercise any discretion or take any action, but shall be required
to act, or to refrain from acting (and shall be fully protected
in so acting or refraining from acting), upon the instructions of
the Required Lenders, and such instructions shall be binding upon
all the Lenders and all holders of any Notes; provided however,
that the Agent shall not be required to take any action which
exposes the Agent to personal liability or which is contrary to
this Agreement or applicable law. The Agent agrees to give to
each Lender prompt notice of each notice given to it by the
Borrower pursuant to the terms of any Financing Agreement.
12.2. AGENT'S RELIANCE, ETC.
Neither the Agent nor any of its directors, officers, agents
or employees shall be liable to any Lender for any action taken
or omitted to be taken by it or them under or in connection with
any Financing Agreement, except for its or their own gross
negligence or willful misconduct. Without limiting the
generality of the foregoing, the Agent: (a) may treat the
original or any successor holder of any Note as the holder
thereof until it receives notice from the Lender which is the
payee of such Note concerning the assignment of such Note; (b)
may employ and consult with legal counsel (including counsel for
the Borrower), independent public accountants, and other experts
selected by it and shall not be liable to any Lender for any
action taken, or omitted to be taken, in good faith by it or them
in accordance with the advice of such counsel, accountants or
experts received in such consultations and shall not be liable
for any negligence or misconduct of any such counsel, accountants
or other experts; (c) makes no warranty or representation to any
Lender and shall not be responsible to any Lender for any
opinions, certifications, statements, warranties or
representations made in or in connection with any Financing
Agreement by Persons other than the Agent; (d) shall not have any
duty to any Lender to ascertain or to inquire as to the
performance or observance of any of the terms, covenants, or
conditions of any Financing Agreement or any other instrument or
document furnished pursuant thereto or to satisfy itself that all
conditions to and requirements for any Loan have been met or that
the Borrower is entitled to any Loan or to inspect the property
(including the books and records) of the Borrower; (e) shall not
be responsible to any Lender for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of
any Financing Agreement or any other instrument or document
furnished pursuant thereto; and (f) shall incur no liability
under or in respect of this Agreement by acting upon any notice,
consent, certificate, or other instrument or writing (which may
be by telegram, cable, telex, or otherwise) believed by it to be
genuine and signed or sent by the proper party or parties.
12.3. DEFAULTS.
The Agent shall not be deemed to have knowledge of the
occurrence of a Default (other than, with respect to the Agent
only, the nonpayment of principal of or interest hereunder or of
any fees) unless the Agent has received written notice from a
Lender or the Borrower specifying such Default and stating that
such notice is a "Notice of Default". In the event that the
Agent receives such a notice of the occurrence of a Default, the
Agent shall give prompt notice thereof to the Lenders (and the
Agent shall give each Lender prompt notice of each such
nonpayment). The Agent shall (subject to Section 11.1) take such
action with respect to such Default as may be directed by the
Required Lenders; provided however, that unless and until the
Agent shall have received the directions referred to in Section
11.1, the Agent may (but shall not be obligated to) take such
action, or refrain from taking such action, with respect to such
Default as it shall deem advisable and in the best interest of
the Lenders.
12.4. THE AGENT AS A LENDER, AFFILIATES.
With respect to its Commitment, any Loan made by it, and the
Note issued to it, the Agent shall have the same rights and
powers under this Agreement as any other Lender and may exercise
the same as though it were not the Agent; and the term "Lender"
or "Lenders" shall, unless otherwise expressly indicated, include
the Agent in its individual capacity. The Agent and its
affiliates may accept deposits from, lend money to, act as
trustee under indentures of, and generally engage in any kind of
business with, the Borrower, any of its respective Affiliates and
any Person who may do business with or own securities of the
Borrower or any such Affiliate, all as if the Agent were not the
Agent and without any duty to account therefor to the Lenders.
12.5. NON-RELIANCE ON AGENT AND OTHER LENDERS.
Each Lender agrees that it has, independently and without
reliance on the Agent or any other Lender, and based on such
documents and information as it has deemed appropriate, made its
own credit analysis of the Borrower and its decision to enter
into the transactions contemplated by the Financing Agreements
and that it will, independently and without reliance upon the
Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to
make its own analysis and decisions in taking or not taking
action under any Financing Agreement. The Agent shall not be
required to keep itself informed as to the performance or
observance by the Borrower or any other Person of any Financing
Agreement or to inspect the properties or books of the Borrower.
Except for notices, reports, and other documents and information
expressly required to be furnished to the Lenders by the Agent
hereunder, the Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information
concerning the affairs, financial condition or business of the
Borrower (or any of their Affiliates) which may come into the
possession of the Agent or any of its affiliates.
12.6. INDEMNIFICATION.
Notwithstanding anything to the contrary herein contained,
the Agent shall be fully justified in failing or refusing to take
any action hereunder unless it shall first be indemnified to its
satisfaction by the Lenders against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses, and disbursements of any kind or nature
whatsoever which may be imposed on, incurred by or asserted
against the Agent in any way relating to or arising out of its
taking or continuing to take any action. Each Lender agrees to
indemnify the Agent (to the extent not reimbursed by the
Borrower), according to such Lender's Commitment, from and
against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses and
disbursements of any kind or nature whatsoever which may be
imposed on, incurred by, or asserted against the Agent in any way
relating to or arising out of any Financing Agreement or any
action taken or omitted by the Agent under any Financing
Agreement; provided however, that no Lender shall be liable for
any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses, or
disbursements resulting from the gross negligence or wilful
misconduct of the Person being indemnified; and provided further,
that it is the intention of each Lender to indemnify the Agent
against the consequences of the Agent's own negligence, whether
such negligence be sole, joint, concurrent, active or passive.
Without limiting the generality of the foregoing, each Lender
agrees to reimburse the Agent promptly upon demand for its Pro
Rata Percentage of any out-of-pocket expenses (including
attorneys' fees) incurred by the Agent in connection with the
preparation, administration, or enforcement of, or legal advice
in respect of rights or responsibilities under, any Financing
Agreement, to the extent that the Agent is not reimbursed for
such expenses by the Borrower.
12.7. SUCCESSOR AGENT.
The Agent may resign at any time as Agent under the
Financing Agreements by giving written notice thereof to the
Lenders and the Borrower and may be removed at any time with or
without cause by the Required Lenders. Upon any such resignation
or removal, the Required Lenders shall have the right to appoint
a successor Agent. If no successor Agent shall have been so
appointed by the Required Lenders or shall have accepted such
appointment within sixty (60) days after the retiring Agent's
giving of notice of resignation or the Required Lenders' removal
of the Agent, then the retiring Agent may, on behalf of the
Lenders, appoint a successor Agent, which shall be a commercial
bank or other financial institution organized under the laws of
the United States of America or of any State thereof and having a
combined capital and surplus of at least $500,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor
Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall thereafter be
discharged from any duties and obligations under the Financing
Agreements. After the retiring Agent's resignation or removal as
Agent, the provisions of this Section 12 shall inure to its
benefit as to any actions taken or omitted to be taken by it
while it was Agent under this Agreement.
12.8. AGENT'S RELIANCE.
The Borrower shall notify the Agent in writing of the names
of the Persons authorized to request a Loan on behalf of the
Borrower and shall provide the Agent with a specimen signature
for each such Person. The Agent shall be entitled to rely
conclusively on such Person's authority to request a Loan on
behalf of the Borrower until the Agent receives written notice
from the Borrower to the contrary. The Agent shall have no duty
to verify the authenticity of the signature appearing on any
notice of borrowing, and with respect to any oral request for a
Loan, the Agent shall have no duty to verify the identity of any
Person representing himself as one of the Persons authorized to
make such request on behalf of the Borrower. Neither the Agent
nor any Lender shall incur any liability to the Borrower in
acting upon any telephonic notice referred to above which the
Agent or such Lender believes in good faith to have been given by
a duly authorized Person authorized to borrow on behalf of the
Borrower or for otherwise acting in good faith.
12.9. ACTION UPON INSTRUCTIONS OF THE REQUIRED LENDERS.
The Agent agrees, upon the written request of the Required
Lenders, to take any action of the type specified in the
Financing Agreements as being within the Agent's rights, duties,
power or discretion. The Agent shall in all cases be fully
protected in acting, or in refraining from acting in accordance
with written instructions signed by the Required Lenders, and
such instructions and any action taken or failure to act pursuant
thereto shall be binding on all of the Required Lenders and on
all holders of the Notes. In the absence of a request by the
Required Lenders, the Agent shall have authority, in its sole
discretion, to take or not to take any action, unless the
Financing Agreements specifically require the consent of the
Required Lenders or of all of the Lenders.
13. MISCELLANEOUS.
13.1 TIMING OF PAYMENTS.
For purposes of determining the outstanding balance of the
Liabilities, including the computations of interest which may
from time to time be owing to the Lenders, the receipt by the
Agent of any check or any other item of payment whether through a
blocked account or lockbox or otherwise, shall not be treated as
a payment on account of the Liabilities until such check or other
item of payment is actually received by the Agent at its office
in Denver, Colorado and is paid to the Agent in cash or a cash
equivalent.
13.2 ATTORNEYS' FEES AND COSTS.
If at any time or times hereafter the Agent or any Lender
employs counsel in connection with any matters contemplated by or
arising out of this Agreement, whether: (a) to commence, defend,
or intervene in any litigation or to file a petition, complaint,
answer, motion or other pleading; (b) to take any other action in
or with respect to any suit or proceeding (bankruptcy or
otherwise); (c) to consult with officers of the Agent or such
Lender to advise the Agent or such Lender or to draft documents
in connection with any of the foregoing or in connection with any
release of the Agent's or any Lender's claims or the Agent's
security interests or any proposed extension, amendment, waiver
or refinancing of the Liabilities; or (d) to attempt to enforce
any rights of the Agent, the Lenders or the Issuer to collect any
of the Liabilities; then in any of such events, all of the
reasonable attorneys' fees arising from such services, and any
expenses, costs and charges relating thereto, including without
limitation, all fees of all paralegals, legal assistants and
other staff employed by such attorneys, together with interest at
the default rate provided for in Section 3.1(c) if a Matured
Default has occurred, or at the highest interest rate set forth
in any promissory note referred to herein, shall constitute
additional Liabilities, payable on demand.
13.3 EXPENDITURES BY THE AGENT.
In the event that the Borrower shall fail to pay taxes,
insurance, assessments, costs or expenses which the Borrower is,
under any of the terms hereof or of any of the other Financing
Agreements, required to pay, or fails to keep its assets free
from other security interests, liens or encumbrances, except as
permitted herein, the Agent may, in its sole discretion and
without obligation to do so, make expenditures for any or all of
such purposes, and the amount so expended, together with interest
at the default rate provided for in Section 3.1(c), shall
constitute additional Liabilities, payable ten (10) days after
demand.
13.4 THE AGENT'S COSTS AND EXPENSES AS ADDITIONAL
LIABILITIES.
The Borrower shall reimburse the Agent for all expenses and
fees paid or incurred in connection with the documentation,
negotiation and closing of the loans and other financial
accommodations described in this Agreement (including without
limitation, filing and recording fees, and the reasonable fees
and expenses of the Agent's attorneys, paralegals and legal
assistants, whether outside the Agent or in its legal department,
and whether such expenses and fees are incurred prior to or after
the Closing Date). The Borrower further agrees to reimburse the
Agent for all expenses and fees paid or incurred in connection
with the documentation of any renewal or extension of the Loans,
any additional financial accommodations, or any other amendments
to this Agreement. All costs and expenses incurred by the Agent
with respect to such negotiation and documentation together with
interest at the highest interest rate set forth in any promissory
note referred to herein, shall constitute additional Liabilities,
payable on demand.
13.5 CLAIMS AND TAXES.
The Borrower agrees to indemnify and hold the Agent, the
Lenders and the Issuer harmless from and against any and all
claims, demands, liabilities, losses, damages, penalties, costs,
and expenses (including without limitation, reasonable attorneys'
fees) relating to or in any way arising out of the possession,
use, operation or control of any of the Borrower's assets. The
Borrower shall pay or cause to be paid all license fees, bonding
premiums and related taxes and charges, and shall pay or cause to
be paid all of the Borrower's real and personal property taxes,
assessments and charges and all of the Borrower's franchise,
income, unemployment, use, excise, old age benefit, withholding,
sales and other taxes and other governmental charges assessed
against the Borrower, or payable by the Borrower, at such times
and in such manner as to prevent any penalty from accruing or any
lien or charge from attaching to the Borrower's property,
provided however, that the Borrower shall have the right to
contest in good faith, by an appropriate proceeding promptly
initiated and diligently conducted, the validity, amount or
imposition of any such tax, and upon such good faith contest to
delay or refuse payment thereof, if (a) the Borrower establishes
adequate reserves to cover such contested taxes; and (b) such
contest does not and will not have a material adverse effect on
the financial condition of the Borrower or the ability of the
Borrower to pay any of the Liabilities.
13.6 INSPECTION.
Upon reasonable prior notice (provided that such notice
shall not be required after the occurrence and during the
continuance of a Default or a Matured Default), the Agent (by and
through its officers and employees), or any Person designated by
the Agent in writing, shall have the right, from time to time
hereafter, to call at the Borrower's place or places of business
(or any other place where any information relating thereto is
kept or located) during reasonable business hours, and without
hindrance or delay, to: (a) inspect, audit, check and make copies
of and extracts from the Borrower's books, records, journals,
orders, receipts and any correspondence and other data relating
to the Borrower's business or to any transactions between the
parties to this Agreement; and (b) review operating procedures,
review maintenance of property and discuss the affairs, finances
and business of the Borrower with the Borrower's officers,
employees or directors. The Borrower agrees to pay to the Agent
an annual audit fee in accordance with the Agent's Letter, on the
date of this Agreement, and on each Anniversary Date as long as
Loans are outstanding, for all expenses incurred by or on behalf
of the Agent in making inspections under this Section 13.6,
including without limitation, travel and photocopying expenses.
The foregoing fees shall be fully earned on the dates they become
payable and, at the option of the Agent, shall be paid by Agent
initiated Loans. The Lenders shall have the right to accompany
the Agent on any inspections under this Section 13.6, at their
own expense.
13.7 EXAMINATION OF BANKING RECORDS.
The Borrower consents to the examination by the Agent, the
Agent's officers, employees and agents, or any of them, after the
occurrence and during the continuance of a Default or a Matured
Default, of any and all of the Borrower's banking records,
wherever they may be found, and directs any Person which may be
in control or possession of such records (including without
limitation, any bank, other financial institution, accountant or
lawyer) to provide such records to the Agent and the Agent's
officers, employees and agents, upon their request. Such
examination may be conducted by the Agent with prior notice to
the Borrower, which notice need not be written, any such written
notice being waived by the Borrower.
13.8 GOVERNMENTAL REPORTS.
The Borrower authorizes all duly constituted federal, state
and municipal authorities to furnish to the Agent copies of their
reports of examinations or inspections of the Borrower.
13.9 RELIANCE BY THE AGENT, THE LENDERS AND THE ISSUER.
All covenants, agreements, representations and warranties
made herein by the Borrower shall, notwithstanding any
investigation by the Agent or any of the Lenders, be deemed to be
material to and to have been relied upon by the Agent, the
Lenders and the Issuer.
13.10 PARTIES.
Whenever in this Agreement there is reference made to any of
the parties hereto, such reference shall be deemed to include,
wherever applicable, a reference to the respective successors and
assigns of the Borrower, the Agent, the Lenders and the Issuer.
13.11 APPLICABLE LAW; SEVERABILITY
This Agreement shall be construed in all respects in
accordance with, and governed by, the laws and decisions of the
State of Colorado. Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision of this
Agreement shall be prohibited by or invalid under applicable law,
such provision shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating the remainder of
such provisions or the remaining provisions of this Agreement.
13.12 SUBMISSION TO JURISDICTION; WAIVER OF BOND AND
TRIAL BY JURY.
AT THE OPTION OF THE AGENT, THE BORROWER WAIVES, TO THE
EXTENT PERMITTED BY LAW, TRIAL BY JURY, AND WAIVES ANY BOND OR
SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR THIS
WAIVER, BE REQUIRED OF THE AGENT. THE BORROWER CONSENTS TO THE
JURISDICTION OF ANY LOCAL, STATE, OR FEDERAL COURT LOCATED WITHIN
THE CITY AND COUNTY OF DENVER, COLORADO AND WAIVES ANY OBJECTION
WHICH THE BORROWER MAY HAVE BASED ON IMPROPER VENUE OR FORUM NON
CONVENIENS TO THE CONDUCT OF ANY PROCEEDING IN ANY SUCH COURT AND
WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON THE BORROWER,
AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE BY MAIL OR
MESSENGER DIRECTED TO THE BORROWER AT THE ADDRESS SET FORTH IN
SECTION 13.18. THE BORROWER IRREVOCABLY APPOINTS CT CORPORATION
AS THE BORROWER'S AGENT FOR THE PURPOSE OF ACCEPTING THE SERVICE
OF ANY PROCESS WITHIN THE STATE OF COLORADO, WHICH SERVICE OF
PROCESS SHALL BE DEEMED TO BE COMPLETED UPON THE EARLIER OF
ACTUAL RECEIPT BY THE BORROWER OR THREE (3) DAYS AFTER SUCH AGENT
FOR SERVICE OF PROCESS HAS POSTED THE SAME TO THE BORROWER'S
ADDRESS SET FORTH IN SECTION 13.18. TO THE EXTENT PERMITTED BY
LAW, THE BORROWER ALSO CONSENTS TO THE GRANTING OF SUCH LEGAL OR
EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE COURT. NOTHING
IN THIS PARAGRAPH SHALL AFFECT THE RIGHT OF THE AGENT TO SERVE
LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT THE
RIGHT OF THE AGENT TO BRING ANY ACTION OR PROCEEDING AGAINST THE
BORROWER OR THE BORROWER'S PROPERTY IN THE COURTS OF ANY OTHER
JURISDICTION.
13.13 APPLICATION OF PAYMENTS WAIVER.
Notwithstanding any contrary provision contained in this
Agreement or in any of the other Financing Agreements, after the
occurrence and during the continuance of a Default or a Matured
Default, the Borrower irrevocably waives the right to direct the
application of any and all payments at any time received by the
Agent from the Borrower, and the Borrower irrevocably agrees that
the Agent shall have the continuing exclusive right to apply and
reapply any and all payments received at any time or times
hereafter against the Liabilities, in such manner as the Agent
may deem advisable, notwithstanding any entry by the Agent upon
any of the Agent's books and records.
13.14 MARSHALLING; PAYMENTS SET ASIDE.
The Agent and the Lenders shall be under no obligation to
xxxxxxxx any assets in favor of the Borrower or against or in
payment of any or all of the Liabilities. To the extent that the
Borrower makes a payment or payments to the Agent or any Lender
or the Agent or any Lender receives any payment for the
Borrower's benefit or exercises the Agent's or any Lender's
rights of set-off, and such payment or payments or the proceeds
of such set-off or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party
under any bankruptcy law, state or federal law, common law or
equitable cause, then to the extent of such recovery, the
obligation or part thereof originally intended to be satisfied
shall be revived and continued in full force and effect as if
such payment had not been made or such enforcement or set-off had
not occurred.
13.15 SECTION TITLES.
The section titles contained in this Agreement shall be
without substantive meaning or content of any kind whatsoever and
are not a part of the agreement among the parties.
13.16 CONTINUING EFFECT.
This Agreement and all of the other Financing Agreements
shall continue in full force and effect so long as any
Liabilities shall be owed to the Agent and/or any of the Lenders
and (even if there shall be no Liabilities outstanding) so long
as the Agent and/or any of the Lenders remains committed to make
Loans under this Agreement.
13.17 NO WAIVER.
The Agent's or the Required Lenders' failure, at any time or
times hereafter, to require strict performance by the Borrower of
any provision of this Agreement shall not waive, affect or
diminish any right of the Agent or the Required Lenders
thereafter to demand strict compliance and performance therewith.
Any suspension or waiver by the Agent or the Required Lenders of
any Default or Matured Default under this Agreement or any of the
other Financing Agreements, shall not suspend, waive or affect
any other Default or Matured Default under this Agreement or any
of the other Financing Agreements, whether the same is prior or
subsequent thereto and whether of the same or of a different kind
or character. None of the undertakings, agreements, warranties,
covenants and representations of the Borrower contained in this
Agreement or any of the other Financing Agreements and no Default
or Matured Default under this Agreement or any of the other
Financing Agreements, shall be deemed to have been suspended or
waived by the Agent or the Required Lenders unless such
suspension or waiver is in writing signed by an officer of the
Agent or each of the Required Lenders (as applicable) and is
directed to the Borrower specifying such suspension or waiver.
13.18 NOTICES.
(a) All notices and other communications provided for
herein shall be in writing (including telex, facsimile, or cable
communication) and shall be mailed, telexed, cabled or delivered
addressed as follows:
(ii) If to the Agent at:
U.S. Bancorp, Inc.
000 Xxxxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxx, President
Facsimile: (000) 000-0000
with a copy to:
Xxxxx Xxxxxxxx XxXxxxxx
Xxxxxx & Xxxxxxx
000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
(ii) If to the Borrower at:
Xxxx X. Xxxxxxxxxx & Son, Inc.
0000 Xxxxx Xxxx
Xxx Xxxxx Xxxxxxx, XX 00000
Attn: Xxxx X. Xxxxxx
Facsimile: (000) 000-0000
with a copy to:
Xxxxxxx X. Elegant, Esq.
Jenner & Block
Xxx XXX Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
(iii) If to any of the Lenders other than the
Agent, at the address for such Lender set forth on
the applicable signature page of this Agreement;
and, as to each party hereto, at such other address as shall be
designated by such party in a written notice to the other parties
hereto. All such notices and communications shall, when mailed,
telecopied, telexed, transmitted or cabled, become effective when
deposited in the mail, confirmed by telex answerback, transmitted
by telecopier or delivered to the cable company respectively,
except that notices and communications to the Agent shall not be
effective until actually received by the Agent.
(b) Advance notices of terminations or reductions of the
Commitments, or borrowings, conversions and prepayments of Loans
and of the durations of Interest Periods, shall be delivered to
the Agent by 11:00 a.m. (Denver time) the number of Business Days
set forth below before the proposed date for the respective
termination, reduction, borrowing, conversion or prepayment.
EVENT DAYS PRIOR NOTICE
Borrowing of Loans
Which are Reference Rate Loans Same
Borrowing of Loans
Which are Eurodollar Rate Loans Two
Conversion of Loans (including changes in
Interest Periods for Eurodollar Rate Loans) Two
Prepayments of Loans
Which are Reference Rate Loans Same
Prepayments of Loans
Which are Eurodollar Rate Loans Two
Termination of Commitments Five
13.19 MAXIMUM INTEREST.
No agreements, conditions, provisions or stipulations
contained in this Agreement or in any of the other Financing
Agreements, or any Matured Default, or any exercise by the Agent
of the right to accelerate the payment of the maturity of
principal and interest, or to exercise any option whatsoever,
contained in this Agreement or any of the other Financing
Agreements, or the arising of any contingency whatsoever, shall
entitle the Agent to collect, in any event, interest exceeding
the Highest Lawful Rate, and in no event shall the Borrower be
obligated to pay interest exceeding the Highest Lawful Rate, and
all agreements, conditions or stipulations, if any, which may in
any event or contingency whatsoever operate to bind, obligate or
compel the Borrower to pay a rate of interest exceeding the
Highest Lawful Rate, shall be without binding force or effect, at
law or in equity, to the extent only of the excess of interest
over such Highest Lawful Rate. In the event any interest is
charged in excess of the Highest Lawful Rate ("Excess"), the
Borrower acknowledges and stipulates that any such charge shall
be the result of an accidental and bona fide error, and such
Excess shall be, first, applied to reduce the principal of any
Liabilities due, and, second, returned to the Borrower, it being
the intention of the parties hereto not to enter at any time into
a usurious or otherwise illegal relationship. The Borrower and
the Agent both recognize that, with fluctuations in the Reference
Rate, such an unintentional result could inadvertently occur. By
the execution of this Agreement, the Borrower covenants that (a)
the credit or return of any Excess shall constitute the
acceptance by the Borrower of such Excess and (b) the Borrower
shall not seek or pursue any other remedy, legal or equitable,
against the Agent based, in whole or in part, upon the charging
or receiving of any interest in excess of the Highest Lawful
Rate. For the purpose of determining whether or not any Excess
has been contracted for, charged or received by the Agent, all
interest at any time contracted for, charged or received by the
Agent in connection with the Liabilities shall be amortized,
prorated, allocated and spread in equal parts during the entire
term of this Agreement.
13.20 ADDITIONAL ADVANCES.
All fees, charges, expenses, costs, expenditures,
obligations, liabilities, losses, penalties and damages incurred
or suffered by the Agent and/or the Lenders and for which the
Borrower is bound to indemnify or reimburse the Agent and/or the
Lenders under this Agreement (other than those which may be paid
without demand therefor, by the Agent initiated Loans) may, at
the option of the Agent, be paid by Agent initiated Loans if such
amounts remain unpaid for a period of ten (10) Business Days
after the Agent and/or the Lenders have made demand therefor.
13.21 REPRESENTATIONS BY THE LENDERS.
Each Lender represents that it is the present intention of
such Lender, as of the date of its acquisition of the Notes, to
acquire the Notes for its account or for the account of its
Affiliates, and not with a view to the distribution or sale
thereof, and, subject to any applicable laws, the disposition of
such Lender's property shall at all times be within its control.
The Notes have not been registered under the Securities Act of
1933, as amended (the "Securities Act"), and may not be
transferred, sold or otherwise disposed of except (a) in a
registered offering under the Securities Act; (b) pursuant to an
exemption from the registration provisions of the Securities Act;
or (c) if the Securities Act shall not apply to the Notes or the
transactions contemplated by the Financing Agreements. Nothing
in this Section 13.21 shall affect the characterization of the
Loans and the transactions contemplated hereunder as commercial
lending transactions.
13.22 COUNTERPARTS.
This Agreement may be executed in several counterparts, and
by the parties hereto on separate counterparts, and each
counterpart, when so executed and delivered, shall constitute an
original instrument, and all such separate counterparts shall
constitute but one and the same instrument.
13.23 SET-OFF.
The Borrower gives and confirms to each Lender a right of
set-off of all moneys, securities and other property of the
Borrower (whether special, general or limited) and the proceeds
thereof, now or hereafter delivered to remain with or in transit
in any manner to such Lender, its correspondent or its agents
from or for the Borrower, whether for safekeeping, custody,
pledge, transmission, collection or otherwise or coming into
possession of such Lender in any way, and also, any balance of
any deposit accounts and credits of the Borrower with, and any
and all claims of security for the payment of the Liabilities
owed by the Borrower to such Lender, contracted with or acquired
by the Lender, whether such liabilities and obligations be joint,
several, absolute, contingent, secured, unsecured, matured or
unmatured, and the Borrower authorizes such Lender at any time or
times, without prior notice after the occurrence of a Matured
Default, to apply such money, securities, other property,
proceeds, balances, credits or claims, or any part of the
foregoing, to such liabilities in such amounts as it may select,
whether such Liabilities be contingent, unmatured or otherwise,
and whether any collateral security therefor is deemed adequate
or not. The rights described herein shall be in addition to any
collateral security described in any separate agreement executed
by the Borrower.
13.24 ASSIGNMENTS AND PARTICIPATIONS.
(a) After the Closing Date and subject to the prior written
consent of the Agent and in the absence of a Default or a Matured
Default, the prior written consent of the Borrower, in both cases
such consents not to be unreasonably withheld, each Lender may
assign to any Person (the "Assignee") all or a portion of its
rights and obligations under this Agreement (including without
limitation, all or a portion of its Commitment and the Notes held
by it); provided however, that (i) each such assignment shall be
of a constant, and not a varying, percentage of all of the
assigning Lender's rights and obligations under this Agreement,
(ii) the total amount of the Commitments (based on the original
Commitments without giving effect to any repayments or
prepayments) so assigned to an Assignee or to an Assignee and its
affiliates taken as a whole shall equal or exceed $5,000,000,
(iii) the remaining Commitments, if any, (based on the original
Commitments without giving effect to any repayments or
prepayments) held by the assigning Lender after giving effect to
any such assignment shall equal or exceed $5,000,000, (iv) the
assignment will not cause the Borrower to incur any additional
liability and (v) the parties to each such assignment shall
execute and deliver to the Agent for its acceptance an Assignment
and Acceptance in substantially the form attached as Exhibit 13A
("Assignment and Acceptance"), together with any Note or Notes
subject to such assignment, a processing and recordation fee of
$5,000, and the unearned portion of any and all fees under
Section 6.1 or Section 6.2. Upon such execution, delivery,
acceptance and recording, from and after the effective date
specified in each Assignment and Acceptance, which effective date
shall be the date on which such Assignment and Acceptance is
accepted by the Agent, (vi) the Assignee thereunder shall be a
party hereto and, to the extent that rights and obligations
hereunder have been assigned to it pursuant to such Assignment
and Acceptance, have the rights and obligations of a Lender under
the Financing Agreements, and (vii) the assigning Lender
thereunder shall be deemed to have relinquished its rights and to
be released from its obligations under the Financing Agreements,
to the extent (and only to the extent) that its rights and
obligations hereunder have been assigned by it pursuant to such
Assignment and Acceptance (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning
Lender's rights and obligations under the Financing Agreements,
such Lender shall cease to be a party thereto). The Agent may,
at its option, pay to any Assignee the unearned portion of fees
under Section 6.1 or Section 6.2 required to be delivered to the
Agent above, or the Agent may retain such fees for its own
account.
(b) By executing and delivering an Assignment and
Acceptance, the assigning Lender thereunder and the Assignee
thereunder confirm to and agree with each other and the other
parties hereto as follows: (i) other than as provided in such
Assignment and Acceptance, such 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 the Financing Agreements or the execution,
legality, validity, enforceability, genuineness, sufficiency or
value of the Financing Agreements or any other instrument or
document furnished pursuant thereto; (ii) such assigning Lender
makes no representation or warranty and assumes no responsibility
with respect to the financial condition of the Borrower or the
performance or observance by the Borrower of any of its
obligations under the Financing Agreements or any other
instrument or document furnished pursuant hereto; (iii) such
Assignee confirms that it has received a copy of the Financing
Agreements, together with copies of the financial statements
referred to in Section 7.15 and such other documents and
information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and
Acceptance; (iv) such Assignee will, 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, continue to make its own credit
decisions in taking or not taking action under this Agreement;
(v) such Assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under
the Financing Agreements as are delegated to the Agent by the
terms thereof, 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 the Financing Agreements are required to be
performed by it as a Lender.
(c) The Agent shall maintain at its address referred to in
Section 13.18 a copy of each Assignment and Acceptance delivered
to and accepted by it.
(d) Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender, together with any Note subject
to such assignment, the Agent shall, if such Assignment and
Acceptance has been completed and if all required consents have
been obtained: (i) accept such Assignment and Acceptance, and
(ii) give prompt notice thereof to the Borrower. Within five
Business Days after its receipt of such notice, the Borrower, at
its own expense, shall execute and deliver to the Agent in
exchange for the surrendered Note a new Note to the order of such
Assignee in an amount equal to the Commitment assumed by it
pursuant to such Assignment and Acceptance and, if the assigning
Lender has retained a Commitment, a new Note to the order of the
assigning Lender in an amount equal to the Commitment retained by
it. Such new Note shall be in an aggregate principal amount
equal to the aggregate principal amount of such surrendered Note,
shall be dated the effective date of such Assignment and
Acceptance and shall otherwise be in substantially the form of
Exhibit 2A. Upon receipt by the Agent of such new Note
conforming to the requirements set forth in the preceding
sentences, the Agent shall return to the Borrower such
surrendered Note, marked to show that such surrendered Note has
(have) been replaced, renewed and extended by such new Note.
(e) Each Lender may sell participations to one or more
banks or other entities in or to all or a portion of its rights
and obligations under this Agreement (including without
limitation, all or a portion of its Commitment and the Note held
by it); provided however, that (i) such Lender's obligations
under this Agreement (including without limitation, its
Commitment to the Borrower) 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
Agreement, (iv) the sale of the participation will not cause the
Borrower to incur any additional liability, (v) the Borrower, the
Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights
and obligations under this Agreement, provided however, that no
participant shall be entitled to recover under the above
provisions an amount in excess of the proportionate share which
such participant holds of the original aggregate principal amount
to which the assigning Lender would otherwise be entitled; and
(vi) no participant shall have any voting rights under this
Agreement.
(f) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to
this Section 13.24, disclose to the assignee or participant or
proposed assignee or participant, any information relating to the
Borrower furnished to such Lender by or on behalf of the
Borrower; provided however, that prior to any such disclosure,
the assignee or participant or proposed assignee or participant
shall agree to preserve the confidentiality of any confidential
information relating to the Borrower received by it from such
Lender.
(g) Any Lender may assign and pledge all or any of the
instruments held by it to any Federal Reserve Bank, the United
States Treasury or AgriBank, Farm Credit Bank, as collateral
security pursuant to Regulation A of the Board of Governors of
the Federal Reserve System and any operating circular issued by
such Federal Reserve System and/or such Federal Reserve Bank or
any applicable regulation providing for such assignments and
pledges to AgriBank, Farm Credit Bank; provided however, that any
payment made by the Borrower for the benefit of such assigning
and/or pledging Lender in accordance with the terms of the
Financing Agreements shall satisfy the Borrower's obligations
under the Financing Agreements in respect thereof to the extent
of such payment. No such assignment and/or pledge shall release
the assigning and/or pledging Lender from its obligations
hereunder.
13.25 CREDIT AGREEMENT CONTROLS.
If there are any conflicts or inconsistencies among this
Agreement and any of the other Financing Agreements, the
provisions of this Agreement shall prevail and control.
13.26 OBLIGATIONS SEVERAL.
The obligations of each Lender under each Financing
Agreement to which it is a party are several, and no Lender shall
be responsible for any obligation or Commitment of any other
Lender under any Financing Agreement to which it is a party.
Nothing contained in any Financing Agreement to which it is a
party, and no action taken by any Lender pursuant thereto, shall
be deemed to constitute the Lenders to be a partnership, an
association, a joint venture, or any other kind of entity.
13.27 PRO RATA TREATMENT.
All Loans under, and all payments and other amounts received
in connection with this Agreement (including without limitation,
amounts received as a result of the exercise by any Lender of any
right of set-off) shall be effectively shared by the Lenders
ratably in accordance with their respective Pro Rata Percentages.
If any Lender shall obtain any payment (whether voluntary,
involuntary, through the exercise of any right of set-off, or
otherwise) on account of the principal of, or interest on, or
fees in respect of, any Note held by it (other than pursuant to
Section 5) in excess of its Pro Rata Percentage of payments on
account of similar Notes obtained by all the Lenders, such Lender
shall forthwith purchase from the other Lenders such
participations in the Notes or Loans made by them as shall be
necessary to cause such purchasing Lender to share the excess
payment ratably with each of them; provided however, 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 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: (a) the amount of such Lender's required repayment
to (b) the total amount so recovered from the purchasing Lender)
of any interest or other amount paid or payable by the purchasing
Lender in respect of the total amount so recovered.
Disproportionate payments of interest shall be shared by the
purchase of separate participations in unpaid interest
obligations, disproportionate payments of fees shall be shared by
the purchase of separate participations in unpaid fee
obligations, and disproportionate payments of principal shall be
shared by the purchase of separate participations in unpaid
principal obligations. The Borrower agrees that any Lender so
purchasing a participation from another Lender pursuant to this
Section 13.27 may, to the fullest extent permitted by law,
exercise all 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 the Borrower in the amount of
such participation. Notwithstanding the foregoing, a Lender may
receive and retain an amount in excess of its Pro Rata Percentage
to the extent, but only to the extent, that such excess results
from such Lender's Highest Lawful Rate exceeding another Lender's
Highest Lawful Rate.
13.28 CONFIDENTIALITY.
Each of the Agent and the Lenders agrees that it will use
its best efforts to keep confidential, in accordance with its
customary procedures for handling confidential information and in
accordance with safe and sound banking practices, any proprietary
information of the Borrower in writing by the Borrower, as being
proprietary and confidential; provided however, that the Agent or
any Lender may disclose any such information (a) to enable it to
comply with any Governmental Requirement applicable to it, (b) in
connection with the defense of any litigation or other proceeding
brought against it arising out of the transactions contemplated
by this Agreement and the other Financing Agreements, (c) in
connection with the supervision and enforcement of the rights and
remedies of the Agent and Lenders under any Financing Agreement
and (d) as set forth in Section 13.24 (f).
13.29 INDEPENDENCE OF COVENANTS.
All covenants under Section 10 shall be given independent
effect so that if a particular action or condition is not
permitted by any of such covenants, the fact that it would be
permitted by an exception to, or be otherwise within the
limitations of, another covenant shall not avoid the occurrence
of a Default or a Matured Default if such action is taken or
condition exists.
13.30 AMENDMENTS AND WAIVERS.
(a) Except as provided in clause (b) or clause (c) of this
Section 13.30, any term, covenant, agreement or condition of this
Agreement may be amended only by a written amendment executed by
the Borrower, the Required Lenders and, if the rights or duties
of the Agent are affected thereby, the Agent, or compliance
therewith only may be waived (either generally or in a particular
instance and either retroactively or prospectively), if the
Borrower shall have obtained the consent in writing of the
Required Lenders and, if the rights or duties of the Agent are
affected thereby, the Agent.
(b) Notwithstanding clause (a) of this Section 13.30, no
amendment or waiver that does not have the consent in writing of
the holders of all outstanding Notes or of all Lenders if no
Loans are outstanding shall (a) reduce the amount or postpone the
date of payment of any scheduled payment or required payment of
principal of the Notes or reduce the rate or extend the time of
payment of interest on the Notes, or reduce the amount of
principal thereof, or modify any of the provisions of the Notes
with respect to the payment or prepayment thereof, (b) give to
any Note any preference over any other Note, (c) amend any of the
following definitions: Available Amount, Pro Rata Percentage or
Required Lenders, (d) alter, modify or amend the provisions of
this Section 13.30, (e) change the amount or increase the term of
any of the Commitments or change the fees required under Section
6, (f) alter, modify or amend the provisions of Section 8 of this
Agreement, or (g) alter, modify or amend any Lender's right to
consent to any action, make any request or give any notice. Any
such amendment or waiver shall apply equally to all Lenders and
all the holders of the Notes and shall be binding upon them, upon
each future holder of any Note and upon the Borrower, whether or
not such Note shall have been marked to indicate such amendment
or waiver. No such amendment or waiver shall extend to or affect
any obligation not expressly amended or waived.
(c) Notwithstanding clause (a) of this Section 13.30, the
Agent and the Borrower, without the consent of either the
Required Lenders or the holders of all outstanding Notes or of
all Lenders if no Loans are outstanding, may execute amendments
to this Agreement and the Financing Agreements which amendments
consist solely of the making of technical corrections and/or
other minor changes which do not materially adversely affect the
rights of the Lenders.
13.31. FINAL AGREEMENT.
THIS WRITTEN AGREEMENT, THE NOTES AND THE OTHER FINANCING
AGREEMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN
ORAL AGREEMENTS BETWEEN THE PARTIES.
[Balance of page intentionally left blank]
IN WITNESS WHEREOF, this Agreement has been duly executed as
of the day and year first above written.
XXXX X. XXXXXXXXXX & SON,
INC., a Delaware corporation
By /s/ Xxxx X. Xxxxxx
-------------------------
Its Executive Vice President,
Finance and Chief Financial
Officer
---------------------------
SUNSHINE NUT CO., INC., a
Texas corporation
By /s/ Xxxxxxx X. Xxxxxxxxx
------------------------
Its Assistant Secretary
-------------------
QUANTZ ACQUISITION CO., INC.,
a Delaware corporation
By /s/ Xxxxxxx X. Xxxxxxxxx
-------------------------
Its Assistant Secretary
-------------------
JBS INTERNATIONAL, INC., a
Barbados corporation
By /s/ Xxxxxxx X. Xxxxxxxxx
-------------------------
Its Assistant Secretary
-------------------
U.S. BANCORP AG CREDIT, INC.,
as Agent and as a Lender
000 00xx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
By /s/ Xxxxxxx X. Xxxxxxx
-------------------------
Its Vice President
--------------
THE OTHER LENDERS:
KEYBANK NATIONAL ASSOCIATION,
as a Lender
By /s/ Xxxxx Xxxx
---------------------------
Its Vice President
--------------
LASALLE NATIONAL BANK, as a
Lender
By /s/ Xxxxx Xxxxxx
---------------------------
Its Vice President
--------------
