AMENDED AND RESTATED
CREDIT AGREEMENT
among
XXXXX, INC.
as Borrower,
T.K.G. ACQUISITION CORP.
and the
DOMESTIC SUBSIDIARIES OF XXXXX, INC.
as Guarantors,
THE LENDERS IDENTIFIED HEREIN,
AND
NATIONSBANK, N.A.,
as Administrative Agent
AND
THE CHASE MANHATTAN BANK,
as Documentation Agent
DATED AS OF DECEMBER 17, 1996
TABLE OF CONTENTS
SECTION 1. DEFINITIONS AND ACCOUNTING TERMS..................................1
1.1. Definitions........................................................1
1.2. Computation of Time Periods and Other
Definitional Provisions....................................26
1.3. Accounting Terms..................................................27
SECTION 2. CREDIT FACILITIES................................................27
2.1. Revolving Loans...................................................27
2.2. Letter of Credit Subfacility......................................29
2.3. Term Loans........................................................36
2.4. Continuations and Conversions.....................................38
2.5. Minimum Amounts...................................................38
2.6. Notes 39
SECTION 3. GENERAL PROVISIONS APPLICABLE TO LOANS AND
LETTERS OF CREDIT........................................39
3.1. Interest..........................................................39
3.2. Place and Manner of Payments......................................40
3.3. Prepayments.......................................................40
3.4. Fees 41
3.5. Payment in full at Maturity.......................................42
3.6. Computations of Interest and Fees.................................42
3.7. Pro Rata Treatment................................................43
3.8. Allocation of Payments After Event of Default.....................44
3.9. Sharing of Payments...............................................46
3.10. Capital Adequacy.................................................47
3.11. Inability To Determine Interest Rate.............................47
3.12. Illegality.......................................................48
3.13. Requirements of Law..............................................48
3.14. Taxes............................................................49
3.15. Indemnity........................................................52
3.16. Replacement Lenders..............................................53
SECTION 4. GUARANTY.........................................................54
4.1. Guaranty of Payment...............................................54
4.2. Obligations Unconditional.........................................54
4.3. Modifications.....................................................55
4.4. Waiver of Rights..................................................55
4.5. Reinstatement.....................................................56
4.6. Remedies..........................................................56
4.7. Limitation of Guaranty............................................56
4.8. Rights of Contribution............................................57
SECTION 5. CONDITIONS PRECEDENT.............................................58
5.1. Closing Conditions................................................58
i
5.2. Conditions to All Extensions of Credit............................65
SECTION 6. REPRESENTATIONS AND WARRANTIES...................................66
6.1. Financial Condition...............................................66
6.2. No Material Change................................................66
6.3. Organization and Good Standing....................................66
6.4. Due Authorization.................................................67
6.5. No Conflicts......................................................67
6.6. Consents..........................................................67
6.7. Enforceable Obligations...........................................67
6.8. No Default........................................................68
6.9. Ownership.........................................................68
6.10. Indebtedness.....................................................68
6.11. Litigation.......................................................68
6.12. Taxes............................................................68
6.13. Compliance with Law..............................................68
6.14. ERISA............................................................69
6.15. Subsidiaries.....................................................70
6.16. Use of Proceeds; Margin Stock....................................70
6.17. Government Regulation............................................70
6.18. Environmental Matters............................................71
6.19. Intellectual Property............................................72
6.20. Solvency.........................................................73
6.21. Investments......................................................73
6.22. No Financing of Corporate Takeovers..............................73
6.23. Location of Collateral...........................................73
6.24. Disclosure.......................................................73
6.25. Licenses, etc....................................................73
6.26. No Burdensome Restrictions.......................................73
6.27. Brokers' Fees....................................................74
6.28. Labor Matters....................................................74
SECTION 7. AFFIRMATIVE COVENANTS............................................74
7.1. Information Covenants.............................................74
7.2. Preservation of Existence and Franchises..........................79
7.3. Books and Records.................................................79
7.4. Compliance with Law...............................................79
7.5. Payment of Taxes and Other Indebtedness...........................79
7.6. Insurance.........................................................79
7.7. Maintenance of Property...........................................81
7.8. Performance of Obligations........................................81
7.9. Collateral........................................................81
7.10. Use of Proceeds..................................................82
7.11. Audits/Inspections...............................................82
7.12. Financial Covenants..............................................82
7.13. Additional Credit Parties........................................83
7.14. Interest Rate Protection Agreements..............................84
SECTION 8. NEGATIVE COVENANTS...............................................84
ii
8.1. Indebtedness......................................................84
8.2. Liens 86
8.3. Nature of Business................................................86
8.4. Consolidation and Merger..........................................87
8.5. Sale or Lease of Assets...........................................87
8.6. Advances, Investments and Loans...................................88
8.7. Dividends.........................................................88
8.8. Transactions with Affiliates......................................89
8.9. Restrictions on the Parent and Ownership
of Subsidiaries.............................................90
8.10. Fiscal Year; Organizational Documents............................90
8.11. Subordinated Debt................................................90
8.12. Limitations......................................................91
8.13. Sale Leasebacks..................................................91
8.14. Negative Pledges.................................................92
8.15. Capital Expenditures.............................................92
SECTION 9. EVENTS OF DEFAULT................................................93
9.1. Events of Default.................................................93
9.2. Acceleration; Remedies............................................96
SECTION 10. AGENCY PROVISIONS...............................................98
10.1. Appointment......................................................98
10.2. Delegation of Duties.............................................98
10.3. Exculpatory Provisions...........................................98
10.4. Reliance on Communications.......................................99
10.5. Notice of Default...............................................100
10.6. Non-Reliance on Agents and Other Lenders........................100
10.7. Indemnification.................................................100
10.8. Agents in Their Individual Capacity.............................101
10.9. Successor Agent.................................................101
SECTION 11. MISCELLANEOUS..................................................102
11.1. Notices.........................................................102
11.2. Right of Set-Off................................................102
11.3. Benefit of Agreement............................................103
11.4. No Waiver; Remedies Cumulative..................................106
11.5. Payment of Expenses; Indemnification............................106
11.6. Amendments, Waivers and Consents................................107
11.7. Counterparts....................................................108
11.8. Headings........................................................109
11.9. Defaulting Lender...............................................109
11.10. Survival of Indemnification and Representations
and Warranties...........................................109
11.11. Governing Law; Venue...........................................109
11.12. Waiver of Jury Trial...........................................110
11.13. Time...........................................................110
11.14. Severability...................................................110
11.15. Entirety.......................................................110
iii
11.16. Binding Effect; Termination of Prior Credit
Agreement................................................110
11.17. Confidentiality................................................111
iv
SCHEDULES
Schedule 1.1(a) Commitment Percentages
Schedule 1.1(b) Existing Letters of Credit
Schedule 1.1(c) Initial Shareholders
Schedule 5.1(h) Mortgaged Properties and Leasehold Properties
Schedule 6.6 Consents, Approvals and Authorizations
Schedule 6.10 Indebtedness
Schedule 6.11 Litigation
Schedule 6.15 Subsidiaries
Schedule 6.18 Environmental Matters
Schedule 6.19 Intellectual Property
Schedule 6.23(a) Real Property Locations
Schedule 6.23(b) Personal Property Locations
Schedule 6.23(c) Chief Executive Offices
Schedule 6.28 Labor Disputes
Schedule 7.1(b) Other Adjustments
Schedule 7.6 Insurance
Schedule 8.2 Liens
Schedule 8.6 Investments
Schedule 11.1 Notices
EXHIBITS
Exhibit 2.1....... Form of Notice of Borrowing
Exhibit 2.4....... Form of Notice of Continuation/Conversion
Exhibit 2.6(a).... Form of Revolving Note
Exhibit 2.6(b).... Form of Term Loan Note
Exhibit 7.1(c).... Form of Officer's Certificate
Exhibit 7.13...... Form of Joinder Agreement
Exhibit 11.3...... Form of Assignment Agreement
v
AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT (this "Credit Agreement"),
is entered into as of December 17, 1996 among Xxxxx, Inc., a Delaware
corporation ("Borrower"), T.K.G. Acquisition Corp., a Delaware corporation
("Parent"), each of the Borrower's Domestic Subsidiaries (the Borrower's
Domestic Subsidiaries, together with the Parent, individually a "Guarantor" and
collectively the "Guarantors"), the Lenders (as defined herein), NATIONSBANK,
N.A., as Administrative Agent for the Lenders and THE CHASE MANHATTAN BANK, as
Documentation Agent for the Lenders.
RECITALS
WHEREAS, the Borrower and the Guarantors entered into that certain
Credit Agreement dated as of February 29, 1996 which provided a $310,000,000
credit facility to the Borrower (the "Prior Credit Agreement"); and
WHEREAS, the Borrower and the Guarantors have requested that the
Lenders provide an amended and restated $230,000,000 credit facility comprised
of a $130,000,000 revolving credit facility and a $100,000,000 term loan
facility; and
WHEREAS, the Lenders have agreed to make the requested amended and
restated credit facility available to the Borrower on the terms and conditions
hereinafter set forth.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. DEFINITIONS AND ACCOUNTING TERMS
1.1. Definitions. As used herein, the following terms shall
have the meanings herein specified unless the context otherwise requires.
Defined terms herein shall include in the singular number the plural and in the
plural the singular:
"Additional Credit Party" means each Person that becomes a
Guarantor after the Closing Date, as provided in Section 7.13.
"Adjusted Base Rate" means the Base Rate plus the Applicable
Percentage.
1
"Adjusted Eurodollar Rate" means the Eurodollar Rate plus the
Applicable Percentage.
"Administrative Agent" means NationsBank, N.A. or any
successor administrative agent appointed pursuant to Section 10.9.
"Administrative Agent Fee Letter" means that certain letter
agreement dated as of November 18, 1996 between the Administrative
Agent and the Borrower, as it may be amended, modified, supplemented or
replaced from time to time.
"Agency Services Address" means NationsBank, N.A.,
NC1-001-15-04, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000,
Attn: Agency Services, or such other address as may be identified by
written notice from the Administrative Agent to the Borrower.
"Agents" mean the Administrative Agent, the Documentation
Agent and the Collateral Agent and any successors and assigns in such
capacity.
"Agents Fee Letter" means that certain letter agreement dated
as of November 18, 1996 among the Agents and the Borrower, as it may be
amended, modified, supplemented or replaced from time to time.
"Affiliate" means, with respect to any Person, any other
Person directly or indirectly controlling (including but not limited to
all directors and officers of such Person), controlled by or under
direct or indirect common control with such Person. A Person shall be
deemed to control a corporation if such Person possesses, directly or
indirectly, the power (i) to vote 10% or more of the securities having
ordinary voting power for the election of directors of such corporation
or (ii) to direct or cause direction of the management and policies of
such corporation, whether through the ownership of voting securities,
by contract or otherwise.
"Applicable Percentage" means for Revolving Loans, Term Loans,
Letter of Credit Fees and Commitment Fees, the appropriate applicable
percentages corresponding to the Leverage Ratio in effect as of the
most recent Calculation Date as shown below:
2
----------- -------------------- ----------------------- ---------------- ------------------- ------------------
Pricing Leverage Ratio Applicable Applicable Applicable Applicable
Level Percentage Percentage Percentage Percentage
For Eurodollar For Base Rate For Letter of For Commitment
Loans Loans Credit Fee Fees
----------- -------------------- ----------------------- ---------------- ------------------- ------------------
I > 4.0 to 1.0 1.50% .50% 1.50% .375%
-
----------- -------------------- ----------------------- ---------------- ------------------- ------------------
< 4.0 to 1.0 but
II > 3.5 to 1.0 1.00% .25% 1.00% .30%
-
----------- -------------------- ----------------------- ---------------- ------------------- ------------------
< 3.5 to 1.0 but
III > 3.0 to 1.0 .875% 0% .875% .25%
-
----------- -------------------- ----------------------- ---------------- ------------------- ------------------
< 3.0 to 1.0 but
IV > 2.5 to 1.0 .75% 0% .75% .25%
-
----------- -------------------- ----------------------- ---------------- ------------------- ------------------
< 2.50 to 1.0 but
V > 2.0 to 1.0 .625% 0% .625% .20%
-
----------- -------------------- ----------------------- ---------------- ------------------- ------------------
VI < 2.0 to 1.0 .50% 0% .50% .175%
----------- -------------------- ----------------------- ---------------- ------------------- ------------------
The Applicable Percentage for Revolving Loans, Term Loans, the
Letter of Credit Fees and the Commitment Fees shall, in each case, be
determined and adjusted quarterly on the date (each a "Calculation
Date") five Business Days after the date by which the Borrower is
required to provide the officer's certificate in accordance with the
provisions of Section 7.1(c); provided that the initial Applicable
Percentage for Revolving Loans, Term Loans, the Letter of Credit Fees
and the Commitment Fees shall be based on Pricing Level III (as shown
above) and shall remain at Pricing Level III until the first
Calculation Date subsequent to the Closing Date and thereafter, the
Pricing Level shall be determined by the then current Leverage Ratio;
and provided further that if the Borrower fails to provide the
officer's certificate required by Section 7.1(c) on or before the most
recent Calculation Date, the Applicable Percentage for Revolving Loans,
Term Loans, the Letter of Credit Fees and the Commitment Fees from such
Calculation Date shall be based on Pricing Level I until such time that
an appropriate officer's certificate is provided whereupon the Pricing
Level shall be determined by the then current Leverage Ratio. Each
Applicable Percentage shall be effective from one Calculation Date
until the next Calculation Date except as set forth in the prior
sentence. Any adjustment in the Applicable Percentage shall be
applicable to all existing Loans and Letters of Credit as well as any
new Loans made or Letters of Credit issued.
At the time the officer's certificate is required to be
delivered pursuant to Section 7.1(c), the Borrower shall promptly
deliver to the Administrative Agent, at the address set forth on
Schedule 11.1 and at the Agency Services Address, information regarding
any change in the Leverage Ratio that would change the then existing
Pricing Level.
"Asset Disposition" means the disposition of any or all of the
assets (or the sale of the stock of a Subsidiary) of the Borrower, the
Parent or any of their Subsidiaries whether by sale, lease, transfer or
otherwise unless
3
permitted by the terms of Section 8.5(a), (b), (c), (e), (f),
(g), (i) or (j).
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the
United States Code, as amended, modified, succeeded or replaced from
time to time.
"Base Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest whole multiple of 1/100 of 1%)
equal to the greater of (a) the Federal Funds Rate in effect on such
day plus 1/2 of 1% or (b) the Prime Rate in effect on such day. If for
any reason the Administrative Agent shall have determined (which
determination shall be conclusive absent manifest error) that it is
unable after due inquiry to ascertain the Federal Funds Rate for any
reason, including the inability or failure of the Administrative Agent
to obtain sufficient quotations in accordance with the terms hereof,
the Base Rate shall be determined without regard to clause (a) of the
first sentence of this definition until the circumstances giving rise
to such inability no longer exist. Any change in the Base Rate due to a
change in the Prime Rate or the Federal Funds Rate shall be effective
on the effective date of such change in the Prime Rate or the Federal
Funds Rate, respectively.
"Base Rate Loan" means any Loan bearing interest at a rate
determined by reference to the Base Rate.
"Borrower" means Xxxxx, Inc., a Delaware corporation, together
with any successors and permitted assigns.
"Business Day" means any day other than a Saturday, a Sunday,
a legal holiday or a day on which banking institutions are authorized
or required by law or other governmental action to close in Charlotte,
North Carolina or New York, New York; provided that in the case of
Eurodollar Loans, such day is also a day on which dealings between
banks are carried on in U.S. dollar deposits in the London interbank
market.
"Calculation Date" has the meaning set forth in the
definition of Applicable Percentage.
"Canadian Subsidiary" means all direct and indirect
Subsidiaries of the Parent that are domiciled, incorporated or
organized under the laws of Canada. As of the Closing Date, the
Canadian Subsidiaries are TKG Canada, Inc., Spinneybeck Ltd. and Knoll
North America Corp.
4
"Capital Expenditures" means all expenditures of the Credit
Parties and their Subsidiaries which, in accordance with GAAP, would be
classified as capital expenditures, including, without limitation,
Capital Leases.
"Capital Lease" means, as applied to any Person, any lease of
any property (whether real, personal or mixed) by that Person as lessee
which, in accordance with GAAP, is or should be accounted for as a
capital lease on the balance sheet of that Person.
"Cash Equivalents" means (a) securities issued or directly and
fully guaranteed or insured by the United States of America or any
agency or instrumentality thereof (provided that the full faith and
credit of the United States of America is pledged in support thereof)
having maturities of not more than twelve months from the date of
acquisition, (b) U.S. dollar denominated (or with respect to Foreign
Subsidiaries, U.S. dollar denominated and non U.S. dollar denominated)
time deposits and certificates of deposit of (i) any Lender, (ii) any
domestic (or with respect to Foreign Subsidiaries, any domestic or
nondomestic) commercial bank of recognized standing having capital and
surplus in excess of $500,000,000 or (iii) any bank whose short-term
commercial paper rating from S&P is at least A-1 or the equivalent
thereof or from Xxxxx'x is at least P-1 or the equivalent thereof (any
such bank being an "Approved Bank"), in each case with maturities of
not more than 270 days from the date of acquisition, (c) commercial
paper and variable or fixed rate notes issued by any Approved Bank (or
by the parent company thereof) or any variable rate notes issued by, or
guaranteed by, any domestic corporation rated A-1 (or the equivalent
thereof) or better by S&P or P-1 (or the equivalent thereof) or better
by Moody's and maturing within six months of the date of acquisition,
(d) repurchase agreements with a bank or trust company (including any
of the Lenders) or recognized securities dealer having capital and
surplus in excess of $500,000,000 for direct obligations issued by or
fully guaranteed by the United States of America in which the Borrower
shall have a perfected first priority security interest (subject to no
other Liens) and having, on the date of purchase thereof, a fair market
value of at least 100% of the amount of the repurchase obligations and
(e) Investments, classified in accordance with GAAP as current assets,
in money market investment programs registered under the Investment
Company Act of 1940, as amended, which are administered by reputable
financial institutions having capital of at least $500,000,000 and the
portfolios of which
5
are limited to Investments of the character described in the
foregoing subdivisions (a) through (d).
"Change of Control" means any of the following events:
(a) prior to the initial Public Equity Offering by the Parent,
the Initial Shareholders cease to be, directly or indirectly, the
beneficial owners, in the aggregate, of more than 50% of the voting
power of the Voting Stock of the Borrower and of the Parent, in each
case on a fully-diluted basis, after giving effect to the conversion
and exercise of all outstanding warrants, options and other securities
of the Borrower or the Parent, as the case may be, convertible into or
exercisable for Voting Stock of the Borrower or the Parent, as the case
may be (whether or not such securities are then currently convertible
or exercisable); or
(a)(b) after the initial Public Equity Offering by the Parent,
(i) any "person" or "group" (within the meaning of Section 13(d) or
14(d) of the Exchange Act) (other than one or more of the Initial
Shareholders) has become, directly or indirectly, the "beneficial
owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act,
except that a Person shall be deemed to have "beneficial ownership" of
all shares that any such Person has the right to acquire, whether such
right is exercisable immediately or only after the passage of time), by
way of merger, consolidation or otherwise, of 35% or more of the voting
power of the Voting Stock of the Borrower or the Parent on a
fully-diluted basis, after giving effect to the conversion and exercise
of all outstanding warrants, options and other securities of the
Borrower or the Parent, as the case may be, convertible into or
exercisable for Voting Stock of the Borrower or the Parent, as the case
may be (whether or not such securities are then currently convertible
or exercisable), and (ii) such Person or group is or becomes, directly
or indirectly, the beneficial owner of a greater percentage of the
voting power of the Voting Stock of the Borrower or the Parent, as the
case may be, calculated on such fully-diluted basis, than the
percentage beneficially owned by the Initial Shareholders; or
(c) during any period of two consecutive calendar years,
individuals who at the beginning of such period constituted either the
board or the board of directors of the Borrower or the Parent, as the
case may be, together with any new members of such board or board of
directors (i) whose elections by such board or board of directors or
whose
6
nomination for election by the stockholders of the Borrower or
the stockholders of the Parent, as the case may be, was approved by a
vote of a majority of the members of such board or board of directors
then still in office who either were directors at the beginning of such
period or whose election or nomination for election was previously so
approved or (ii) elected by the Initial Shareholders, cease for any
reason to constitute a majority of the directors of the Borrower or of
the Parent, as the case may be, then in office; or
(d) a "change of control" (as defined in the Indenture)
occurs.
"Closing Date" means the date hereof.
"Code" means the Internal Revenue Code of 1986, as amended,
modified, succeeded or replaced from time to time.
"Collateral" means all collateral referred to in and covered
by the Collateral Documents.
"Collateral Agent" means NationsBank, N.A. or any successor
collateral agent appointed pursuant to Section 10.9.
"Collateral Documents" means the Amended and Restated Security
Agreements, the Amended and Restated Pledge Agreements, the Mortgage
Documents (and any amendments thereto) and such other documents
executed and delivered in connection with the attachment and perfection
of the Lenders' security interests in the assets of the Credit Parties,
including without limitation, the Mortgage Policies, UCC financing
statements and patent and trademark filings.
"Commitment Fees" means the fees payable to the Lenders
pursuant to Section 3.4(a).
"Commitments" means the Revolving Committed Amount and the
Term Loan Committed Amount.
"Credit Documents" means this Credit Agreement, the Notes, any
Joinder Agreement, the Collateral Documents, the LOC Documents, the Fee
Letter and all other related agreements and documents issued or
delivered hereunder or thereunder or pursuant hereto or thereto.
"Credit Parties" means the Borrower and the Guarantors and
"Credit Party" means any one of them.
7
"Credit Party Obligations" means, without duplication, (a) all
of the obligations of the Credit Parties to the Lenders (including the
Issuing Lender) and the Agents, whenever arising, under this Credit
Agreement, the Notes, the Collateral Documents or any of the other
Credit Documents to which the Borrower or any other Credit Party is a
party and (b) if and to the extent agreed to by a Credit Party in the
documentation evidencing same, all liabilities and obligations owing
from such Credit Party to any Lender, or any Affiliate of a Lender,
arising under interest rate protection agreements, Currency Agreements,
commodity purchase or option agreements or other interest or exchange
rate or commodity price hedging agreements (collectively, "Hedging
Agreements").
"Currency Agreement" means any foreign exchange contract,
currency swap agreement or other similar agreement or arrangement, to
or under which the Borrower or any of its Subsidiaries is a party or a
beneficiary, entered into in the ordinary course (and not for
investment or speculative purposes) and designed to protect the
Borrower or any of its Subsidiaries against fluctuations in currency
values.
"Default" means any event, act or condition which with notice
or lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" means, at any time, any Lender that,
within one Business Day of when due (a) has failed to make a Loan or
purchase a Participation Interest required pursuant to the term of this
Credit Agreement, (b) other than as set forth in (a) above, has failed
to pay to the Agents or any Lender an amount owed by such Lender
pursuant to the terms of this Credit Agreement unless such amount is
subject to a good faith dispute or (c) has been deemed insolvent or has
become subject to a bankruptcy or insolvency proceeding or to a
receiver, trustee or similar official.
"Documentation Agent" means The Chase Manhattan Bank or any
successor documentation agent appointed pursuant to Section 10.9.
"Domestic Subsidiaries" means all direct and indirect
Subsidiaries of the Parent or the Borrower that are domiciled,
incorporated or organized under the laws of any state of the United
States or the District of Columbia (or has any material assets
located in the United States). As of the Closing Date, the Domestic
Subsidiaries are Knoll Overseas, Inc. and Spinneybeck Enterprises, Inc.
8
"Dollars" and "$" means dollars in lawful currency of the
United States of America.
"EBITDA" means, for any period, with respect to the Credit
Parties and their Subsidiaries on a consolidated basis, the sum of (a)
Net Income for such period (excluding the effect of any extraordinary
or other non-recurring gains or losses outside of the ordinary course
of business) plus (b) an amount which, in the determination of Net
Income for such period has been deducted for (i) cash Interest Expense
for such period, (ii) total Federal, state, foreign or other income
taxes for such period and (iii) all Non-Cash Charges for such period,
all as determined in accordance with GAAP; provided that year end audit
adjustments for the 1995 fiscal year, for purposes of calculating
EBITDA, shall be allocated equally over each of the four quarters of
1995.
"Effective Date" means the date on which the conditions set
forth in Section 5.1 shall have been fulfilled (or waived in the sole
discretion of the Lenders).
"Eligible Assignee" means (a) any Lender or Affiliate or
subsidiary of a Lender and (b) any other commercial bank, financial
institution, institutional lender or "accredited investor" (as defined
in Regulation D of the Securities and Exchange Commission).
"Environmental Claim" means any investigation, written notice,
violation, written demand, written allegation, action, suit,
injunction, judgment, order, consent decree, penalty, fine, lien,
proceeding, or written claim whether administrative, judicial, or
private in nature from activities or events taking place during or
prior to the Borrower's or any of its Subsidiaries' ownership or
operation of any Real Property and arising (a) pursuant to, or in
connection with, an actual or alleged violation of, any Environmental
Law, (b) in connection with any Hazardous Material, (c) from any
assessment, abatement, removal, remedial, corrective, or other response
action required by an Environmental Law or other order of a
Governmental Authority or (d) from any actual or alleged damage,
injury, threat, or harm to health, safety, natural resources, or the
environment.
"Environmental Laws" means any current or future legal
requirement of any Governmental Authority pertaining to (a) the
protection of health, safety, and the environment, (b) the
conservation, management, or use of natural resources and wildlife, (c)
the protection or use of surface water and
9
groundwater or (d) the management, manufacture, possession,
presence, use, generation, transportation, treatment, storage,
disposal, release, threatened release, abatement, removal, remediation
or handling of, or exposure to, any hazardous or toxic substance or
material and includes, without limitation, the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as
amended by the Superfund Amendments and Reauthorization Act of 1986, 42
USC 9601 et seq., Solid Waste Disposal Act, as amended by the Resource
Conservation and Recovery Act of 1976 and Hazardous and Solid Waste
Amendment of 1984, 42 USC 6901 et seq., Federal Water Pollution Control
Act, as amended by the Clean Water Act of 1977, 33 USC 1251 et seq.,
Clean Air Act of 1966, as amended, 42 USC 7401 et seq., Toxic
Substances Control Act of 1976, 15 USC 2601 et seq., Hazardous
Materials Transportation Act, 49 USC App. 1801 et seq., Occupational
Safety and Health Act of 1970, as amended, 29 USC 651 et seq., Oil
Pollution Act of 1990, 33 USC 2701 et seq., Emergency Planning and
Community Right-to-Know Act of 1986, 42 USC 11001 et seq., National
Environmental Policy Act of 1969, 42 USC 4321 et seq., Safe Drinking
Water Act of 1974, as amended, 42 USC 300(f) et seq., any analogous
implementing or successor law, and any amendment, rule, regulation,
order, or directive issued thereunder.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute thereto, as interpreted by
the rules and regulations thereunder, all as the same may be in effect
form time to time. References to sections of ERISA shall be construed
also to refer to any successor sections.
"ERISA Affiliate" means an entity, whether or not
incorporated, which is under common control with any Credit Party or
any of its Subsidiaries within the meaning of Section 4001(a)(14) of
ERISA, or is a member of a group which includes any Credit Party or any
of its Subsidiaries and which is treated as a single employer under
Sections 414(b), (c), (m), or (o) of the Code.
"Eurodollar Loan" means a Loan bearing interest based at a
rate determined by reference to the Eurodollar Rate.
"Eurodollar Rate" means, for the Interest Period for each
Eurodollar Loan comprising part of the same borrowing (including
conversions, extensions and renewals), a per annum interest rate
determined pursuant to the following formula:
10
Eurodollar Rate = London Interbank Offered Rate/
1 - Eurodollar Reserve Percentage
"Eurodollar Reserve Percentage" means for any day, that
percentage (expressed as a decimal) which is in effect from time to
time under Regulation D of the Board of Governors of the Federal
Reserve System (or any successor), as such regulation may be amended
from time to time or any successor regulation, as the maximum reserve
requirement (including, without limitation, any basic, supplemental,
emergency, special, or marginal reserves) applicable with respect to
Eurocurrency liabilities as that term is defined in Regulation D (or
against any other category of liabilities that includes deposits by
reference to which the interest rate of Eurodollar Loans is
determined), whether or not a Lender has any Eurocurrency liabilities
subject to such reserve requirement at that time. Eurodollar Loans
shall be deemed to constitute Eurocurrency liabilities and as such
shall be deemed subject to reserve requirements without benefits of
credits for proration, exceptions or offsets that may be available from
time to time to a Lender. The Eurodollar Rate shall be adjusted
automatically on and as of the effective date of any change in the
Eurodollar Reserve Percentage.
"Event of Default" has the meaning specified in Section 9.1.
"Excess Cash Flow" means, with respect to any fiscal year
period of the Credit Parties and their Subsidiaries, on a consolidated
basis, an amount equal to (a) EBITDA for such period minus (b) Capital
Expenditures for such period minus (c) Interest Expense for such period
minus (d) Federal, state and other income taxes actually paid during
such period minus (e) Principal Amortization Payments made during such
period minus (f) increases in Working Capital (or plus any decreases in
Working Capital) for such period, minus (g) any cash loss (or plus any
cash gain) of an extraordinary nature otherwise excluded in calculating
EBITDA, minus (h) any cash gain from an Asset Disposition (to the
extent included in EBITDA and paid to the Lenders as a mandatory
prepayment pursuant to Section 3.3(b)(ii)).
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"Existing Letters of Credit" means the letters of credit
described by date of issuance, letter of credit
11
number, undrawn amount, name of beneficiary and the date of
expiry on Schedule 1.1(b) hereto.
"Extension of Credit" means, as to any Lender, the making of a
Loan by such Lender (or a participation therein by a Lender) or the
issuance of, or participation in, a Letter of Credit by such Lender.
"Federal Funds Rate" means for any day the rate per annum
(rounded upward, if necessary, to the nearest 1/100th of 1%) equal to
the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published by the Federal Reserve
Bank of New York on the Business Day next succeeding such day; provided
that (a) if such day is not a Business Day, the Federal Funds Rate for
such day shall be such rate on such transactions on the next preceding
Business Day and (b) if no such rate is so published on such next
preceding Business Day, the Federal Funds Rate for such day shall be
the average rate quoted to the Administrative Agent on such day on such
transactions as determined by the Administrative Agent.
"Fee Letters" means (a) the Agents Fee Letter, and (b) the
Administrative Agent Fee Letter
"Foreign Subsidiaries" means all Subsidiaries of
the Borrower that are not Domestic Subsidiaries.
"Funded Debt" means, without duplication, the sum of (a) all
Indebtedness of the Credit Parties and their Subsidiaries for borrowed
money (it being understood that with respect to Indebtedness incurred
with an original issue discount, the obligations shall consist of the
then accreted value), (b) all purchase money Indebtedness of the Credit
Parties and their Subsidiaries, (c) the principal portion of all
obligations of the Borrower and its Subsidiaries under Capital Leases,
(d) commercial letters of credit and the maximum amount of all
performance and standby letters of credit issued or bankers' acceptance
facilities created for the account of a Credit Party or one of its
Subsidiaries, including, without duplication, all unreimbursed draws
thereunder, (e) all Guaranty Obligations of the Credit Parties and
their Subsidiaries with respect to Funded Debt of another person, (f)
all Funded Debt of another entity secured by a Lien on any property of
the Credit Parties and their Subsidiaries whether or not such Funded
Debt has been assumed by a Credit Party or any of its Subsidiaries, (g)
all Funded Debt of any partnership or unincorporated joint venture to
the extent a Credit Party or one of its Subsidiaries is
12
legally obligated or has a reasonable expectation of being
liable with respect thereto, net of any assets of such partnership or
joint venture and (h) the principal balance outstanding under any
synthetic lease, tax retention operating lease, off-balance sheet loan
or similar off-balance sheet financing product where such transaction
is considered borrowed money indebtedness for tax purposes but is
classified as an operating lease in accordance with GAAP.
"GAAP" means generally accepted accounting principles in the
United States applied on a consistent basis and subject to Section 1.3.
"Governmental Authority" means any Federal, state, local,
provincial or foreign court or governmental agency, authority,
instrumentality or regulatory body.
"Guarantor" means the Parent, each of the Domestic
Subsidiaries of the Borrower and each Additional Credit Party which has
executed a Joinder Agreement, together with their successors and
assigns.
"Guaranty Obligations" means, with respect to any Person,
without duplication, any obligations (other than endorsements in the
ordinary course of business of negotiable instruments for deposit or
collection) guaranteeing or intended to guarantee any Indebtedness of
any other Person in any manner, whether direct or indirect, and
including without limitation any obligation, whether or not contingent,
(a) to purchase any such Indebtedness or other obligation or any
property constituting security therefor, (b) to advance or provide
funds or other support for the payment or purchase of such indebtedness
or obligation or to maintain working capital, solvency or other balance
sheet condition of such other Person (including, without limitation,
maintenance agreements, comfort letters, take or pay arrangements, put
agreements or similar agreements or arrangements) for the benefit of
the holder of Indebtedness of such other Person, (c) to lease or
purchase property, securities or services primarily for the purpose of
assuring the owner of such Indebtedness or (d) to otherwise assure or
hold harmless the owner of such Indebtedness or obligation against loss
in respect thereof. The amount of any Guaranty Obligation hereunder
shall (subject to any limitations set forth therein) be deemed to be an
amount equal to the outstanding principal amount (or maximum principal
amount, if larger) of the Indebtedness in respect of which such
Guaranty Obligation is made.
13
"Hazardous Materials" means any substance, material or waste
defined or regulated in or under any Environmental Laws.
"Hedging Agreements" has the meaning set forth in the
definition of Credit Party Obligations.
"Indebtedness" of any Person means, without duplication, (a)
all obligations of such Person for borrowed money, (b) all obligations
of such Person evidenced by bonds, debentures, notes or similar
instruments, (c) all obligations of such Person under conditional sale
or other title retention agreements relating to property purchased by
such Person to the extent of the value of such property (other than
customary reservations or retentions of title under agreements with
suppliers entered into in the ordinary course of business), (d) all
obligations, other than intercompany items, of such Person issued or
assumed as the deferred purchase price of property or services
purchased by such Person which would appear as liabilities on a balance
sheet of such Person, (e) all Indebtedness of others secured by (or for
which the holder of such Indebtedness has an existing right, contingent
or otherwise, to be secured by) any Lien on, or payable out of the
proceeds of production from, property owned or acquired by such Person,
whether or not the obligations secured thereby have been assumed, (f)
all Guaranty Obligations of such Person, (g) the principal portion of
all obligations of such Person under (i) Capital Leases and (ii) any
synthetic lease, tax retention operating lease, off-balance sheet loan
or similar off-balance sheet financing product where such transaction
is considered borrowed money indebtedness for tax purposes but is
classified as an operating lease in accordance with GAAP (collectively,
"TROLS"), (h) all obligations of such Person in respect of interest
rate protection agreements, foreign currency exchange agreements, or
other interest or exchange rate or commodity price hedging agreements,
(i) the maximum amount of all performance and standby letters of credit
issued or bankers' acceptances facilities created for the account of
such Person and, without duplication, all drafts drawn thereunder (to
the extent unreimbursed), (j) all preferred stock issued by such Person
and required by the terms thereof to be redeemed, or for which
mandatory sinking fund payments are due, by a fixed date and (k) the
aggregate amount of uncollected accounts receivable of such Person
subject at such time to a sale of receivables (or similar transaction)
regardless of whether such transaction is effected without recourse to
such Person or in a manner that would not be reflected on the balance
sheet of such Person in
14
accordance with GAAP. The Indebtedness of any Person shall
include the Indebtedness of any partnership or unincorporated joint
venture in which such Person is legally obligated or has a reasonable
expectation of being liable with respect thereto. Indebtedness shall
not include (i) "teaming agreements" pursuant to which the Borrower or
any of its Subsidiaries shall agree with another supplier of services
to provide services (including the sale of inventory) to a third person
and pursuant to such agreement shall be responsible to the third Person
for the performance of the obligations of such other supplier, (ii)
warranty claims, (iii) product guarantees, (iv) guarantees by a Person
of obligations not constituting Indebtedness of the Borrower or any of
its Subsidiaries and (v) obligations under joint development agreements
pursuant to which the Borrower and any of its Subsidiaries agree to
develop a product.
"Indenture" means that certain Indenture dated as of
February 29, 1996 among Xxxxx, Inc. (f/k/a T.K.G. Acquisition Sub,
Inc.) as issuer, the guarantors named therein and IBJ Xxxxxxxx
Bank & Trust Company, as trustee, as the same may be modified,
supplemented or amended from time to time.
"Initial Shareholders" means the Persons on Schedule 1.1(c).
"Insignificant Subsidiary" means a Foreign Subsidiary
that (a) has assets of less than $2,500,000 (or its U.S. dollar
equivalent) and (b) is not a Canadian Subsidiary.
"Interest Coverage Ratio" means, as of the end of each fiscal
quarter of the Credit Parties, for the twelve month period ending on
such date, with respect to the Credit Parties and their Subsidiaries on
a consolidated basis, the ratio of (a) EBITDA for the applicable period
to (b) the sum of cash Interest Expense for the applicable period plus
amounts used to pay dividends or redeem stock for the applicable
period, as required in Section 8.7 (after giving effect to the Interim
Adjustments for the calculation occurring on December 31, 1996).
"Interest Expense" means, for any period, with respect to the
Credit Parties and their Subsidiaries on a consolidated basis, all net
interest expense, including the interest component under Capital
Leases, as determined in accordance with GAAP; it being understood that
Interest Expense shall, at the option of the Borrower, include the
amortized cost of any interest rate protection agreements or Currency
Agreements to the extent permitted by GAAP.
15
"Interest Payment Date" means (a) as to Base Rate Loans, the
last day of each fiscal quarter of the Borrower and on the Revolving
Loan Maturity Date or the Term Loan Maturity Date, as applicable, and
(b) as to Eurodollar Loans, on the last day of each applicable Interest
Period and on the Revolving Loan Maturity Date or the Term Loan
Maturity Date, as applicable, and in addition where the applicable
Interest Period for a Eurodollar Loan is greater than three months,
then also on the date three months from the beginning of the Interest
Period and each three months thereafter.
"Interest Period" means, as to Eurodollar Loans, a period of
one, two, three or six months' duration, as the Borrower may elect,
commencing, in each case, on the date of the borrowing (including
continuations and conversions thereof); provided, however, (a) if any
Interest Period would end on a day which is not a Business Day, such
Interest Period shall be extended to the next succeeding Business Day
(except that where the next succeeding Business Day falls in the next
succeeding calendar month, then on the next preceding Business Day),
(b) no Interest Period shall extend beyond the Revolving Loan Maturity
Date or the Term Loan Maturity Date, as applicable, (c) with regard to
the Term Loans, no Interest Period shall extend beyond any Principal
Amortization Payment Date unless the portion of Term Loans comprised of
Base Rate Loans together with the portion of Term Loans comprised of
Eurodollar Loans with Interest Periods expiring prior to the date such
Principal Amortization Payment is due, is at least equal to the amount
of such Principal Amortization Payment due on such date and (d) where
an Interest Period begins on a day for which there is no numerically
corresponding day in the calendar month in which the Interest Period is
to end, such Interest Period shall end on the last Business Day of such
calendar month. Notwithstanding the above, prior to December 31, 1996,
the Borrower may not, without the consent of the Agents, request any
Interest Period other than a one month Interest Period for any
Eurodollar Loans.
"Interim Adjustments" means, for the first fiscal quarter
following the Closing Date, that the Interest Coverage Ratio shall be
calculated using the adjustments and assumptions regarding Interest
Expense set forth below:
(a) for the fiscal quarter ending December 31, 1996,
Interest Expense for the twelve month period for which the
Interest Coverage Ratio is being calculated shall be deemed to
be the result obtained by multiplying (i) the actual Interest
Expense for the period from February 29, 1996 through the last
day of
16
such fiscal quarter times (ii) a ratio equal to (A)
365 divided by (B) the number of days elapsed from February
29, 1996 until the last day of such quarter; and
(b) for the fiscal quarter ending March 31, 1997 and
each fiscal quarter thereafter, Interest Expense shall be the
actual Interest Expense for the twelve month period ending on
such date.
"Investment" in any Person means (a) the acquisition (whether
for cash, property, services, assumption of Indebtedness, securities or
otherwise) of assets, shares of capital stock, bonds, notes,
debentures, partnership, joint ventures or other ownership interests or
other securities of such other Person or (b) any deposit with, or
advance, loan or other extension of credit to, such Person (other than
deposits made in connection with the purchase of equipment or other
assets in the ordinary course of business) or (c) any other capital
contribution to or investment in such Person, including, without
limitation, any Guaranty Obligation (including any support for a Letter
of Credit issued on behalf of such Person) incurred for the benefit of
such Person.
"Issuing Lender" means NationsBank, N.A.
"Issuing Lender Fees" has the meaning set forth in
Section 3.4(b).
"Joinder Agreement" means a Joinder Agreement substantially
in the form of Exhibit 7.13.
"Leasehold Mortgaged Properties" has the meaning set forth
in Section 5.1(g).
"Leasehold Mortgages" has the meaning set forth in
Section 5.1(g).
"Lender" means any of the Persons identified as a "Lender" on
the signature pages hereto, and any Person which may become a Lender by
way of assignment in accordance with the terms hereof, together with
their successors and permitted assigns.
"Letter of Credit" means (i) a Letter of Credit issued for the
account of a Credit Party by the Issuing Lender pursuant to Section
2.2, as such Letter of Credit may be amended, modified, extended,
renewed or replaced and (ii) any Existing Letters of Credit.
17
"Letter of Credit Fee" shall have the meaning assigned to such
term in Section 3.4(b).
"Leverage Ratio" means, as of the end of each fiscal quarter
of the Credit Parties, with respect to the Credit Parties and their
Subsidiaries on a consolidated basis, the ratio of (a) Funded Debt on
such date to (b) EBITDA for the twelve month period ending on such
date.
"Lien" means any mortgage, pledge, hypothecation, assignment,
deposit arrangement, security interest, encumbrance, lien (statutory or
otherwise), preference, priority or charge of any kind, including,
without limitation, any agreement to give any of the foregoing, any
conditional sale or other title retention agreement, and any lease in
the nature thereof.
"Loan" or "Loans" means the Revolving Loans and/or the Term
Loans (or a portion of any Revolving Loan or the Term Loans),
individually or collectively, as appropriate.
"LOC Documents" means, with respect to any Letter of Credit,
such Letter of Credit, any amendments thereto, any documents delivered
in connection therewith, any application therefor, and any agreements,
instruments, guarantees or other documents (whether general in
application or applicable only to such Letter of Credit) governing or
providing for (a) the rights and obligations of the parties concerned
or at risk or (b) any collateral security for such obligations.
"LOC Obligations" means, at any time, the sum of (a) the
maximum amount which is, or at any time thereafter may become,
available to be drawn under Letters of Credit then outstanding,
assuming compliance with all requirements for drawings referred to in
such Letters of Credit plus (b) the aggregate amount of all drawings
under Letters of Credit honored by an Issuing Lender but not
theretofore reimbursed.
"LOC Participants" means all Lenders whose Revolving Loan
Commitment Percentage is greater than zero.
"London Interbank Offered Rate" means, with respect to any
Eurodollar Loan for the Interest Period applicable thereto, the rate of
interest per annum (rounded upwards, if necessary, to the nearest 1/100
of 1%) appearing on Telerate Page 3750 (or any successor page) as the
London interbank offered rate for deposits in Dollars at approximately
11:00 A.M. (London time) two Business Days prior to the first day of
such Interest Period for a term comparable to such
18
Interest Period; provided, however, if more than one rate is
specified on Telerate Page 3750, the applicable rate shall be the
arithmetic mean of all such rates. If, for any reason, such rate is not
available, the term "London Interbank Offered Rate" shall mean, with
respect to any Eurodollar Loan for the Interest Period applicable
thereto, the rate of interest per annum (rounded upwards, if necessary,
to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as
the London interbank offered rate for deposits in Dollars at
approximately 11:00 A.M. (London time) two Business Days prior to the
first day of such Interest Period for a term comparable to such
Interest Period; provided, however, if more than one rate is specified
on Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates.
"Management" means any current or former officer, director or
employee of any Credit Party or their direct or indirect Subsidiaries;
provided that with respect to former officers, directors or employees,
any stock or option in question must have been earned or received while
such Person was an officer, director or employee.
"Mandatory Borrowing" has the meaning set forth in
Section 2.2(e).
"Material Adverse Effect" means a material adverse effect,
after taking into account any applicable insurance and any applicable
indemnification (to the extent the provider of such insurance or
indemnification has the financial ability to support its obligations
with respect thereto and is not disputing or refusing to acknowledge
same), on (a) the operations, financial condition, business or
prospects of the Credit Parties and their Subsidiaries taken as a
whole, (b) the ability of a Credit Party to perform its respective
obligations under this Credit Agreement or any of the other Credit
Documents, or (c) the validity or enforceability of this Credit
Agreement, any of the other Credit Documents, or the rights and
remedies of the Lenders hereunder or thereunder taken as a whole.
"Material Contract" has the meaning set forth in the
Security Agreements.
"Moody's" means Xxxxx'x Investors Service, Inc., or any
successor or assignee of the business of such company in the business
of rating securities.
19
"Mortgage Documents" means the Mortgages and the Leasehold
Mortgages.
"Mortgage Policies" has the meaning set forth in
Section 5.1(g).
"Mortgages" has the meaning set forth in Section 5.1(g).
"Mortgaged Properties" has the meaning set forth in
Section 5.1(g).
"Multiemployer Plan" means a Plan covered by Title IV of ERISA
which is a multiemployer plan as defined in Section 3(37) or 4001(a)(3)
of ERISA.
"Multiple Employer Plan" means a Plan covered by Title IV of
ERISA, other than a Multiemployer Plan, which any Credit Party or any
of its Subsidiaries or any ERISA Affiliate and at least one employer
other than a Credit Party or any of its Subsidiaries or any ERISA
Affiliate are contributing sponsors.
"Net Cash Proceeds" means the gross cash proceeds (including
cash actually received (but only when received) by way of deferred
payment pursuant to a promissory note, receivable, or otherwise)
received from an Asset Disposition or Public Equity Offering, net of
(a) transaction costs payable to third parties, (b) a good faith
estimate of the taxes payable with respect to such proceeds, including,
without duplication, withholding taxes and any taxes payable to a third
party in connection with distribution of such proceeds from a
Subsidiary of the Borrower to the Borrower, (c) any reserve for
adjustment in respect of the sale price of such asset or assets
established in accordance with the terms of the applicable agreements
governing such Asset Disposition as long as such reserve amounts are
placed in escrow with a third party and (d) any payments to be made by
the Borrower or any of its Subsidiaries, as agreed to between the
Borrower or such Subsidiary and the purchaser of such asset or assets,
in connection with such sale or disposition.
"Net Income" means, for any period, the net income after taxes
for such period of the Credit Parties and their Subsidiaries on a
consolidated basis, as determined in accordance with GAAP, but
excluding for periods prior to February 29, 1996 any non-cash charges
as a result of pushdown accounting (as set forth in Securities and
Exchange
20
Commission Staff Accounting Bulletin No. 55) in connection
with the acquisition consummated on February 29, 1996.
"Non-Cash Charges" means, for any period, with respect to the
Credit Parties and their Subsidiaries on a consolidated basis, all
depreciation, amortization and other non-cash charges (excluding any
non-cash charges that require an accrual or reserve for cash charges
for any future period, other than accruals for future retiree medical
obligations made pursuant to SFAS Xx. 00, Xx. 000 and No. 106, as
amended or modified).
"Non-Excluded Taxes" has the meaning set forth in
Section 3.14.
"Note" or "Notes" means the Revolving Loan Notes and/or the
Term Loan Notes, individually or collectively, as appropriate.
"Notice of Borrowing" means a request by the Borrower for a
Revolving Loan, in the form of Exhibit 2.1.
"Notice of Continuation/Conversion" means a request by the
Borrower to continue an existing Eurodollar Loan to a new Interest
Period or to convert a Eurodollar Loan to a Base Rate Loan or a Base
Rate Loan to a Eurodollar Loan, in the form of Exhibit 2.4.
"Parent" means T.K.G. Acquisition Corp., together with any
successors and permitted assigns.
"Participation Interest" means the Extension of Credit by a
Lender by way of a purchase of a participation in Letters of Credit or
LOC Obligations as provided in Section 2.2 or in any Loans as provided
in Section 3.9.
"PBGC" means the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA and any
successor thereto.
"Permitted Acquisition" means the acquisition of (a) all of
the capital stock of another Person or (b) all or substantially all of
the assets of another Person; provided that (x) no such acquisition can
occur prior to March 1, 1997 and (y) after giving effect to such
acquisition (i) the Credit Parties and their Subsidiaries are in
compliance, on a Pro Forma basis, with all the financial covenants set
forth in Section 7.12 and (ii) no Default or Event of Default exists
and is continuing.
21
"Permitted Investments" means Investments which are (a) cash
or Cash Equivalents, (b) accounts receivable created, acquired or made
in the ordinary course of business and payable or dischargeable in
accordance with customary trade terms or otherwise in the prudent
judgment of a Credit Party, (c) inventory, raw materials and general
intangibles (to the extent such general intangible is not a Capital
Expenditure) acquired in the ordinary course of business, (d)
Investments by one Credit Party in another Credit Party, or by a
Foreign Subsidiary (other than a Canadian Subsidiary) in another
Foreign Subsidiary (other than a Canadian Subsidiary) or by a Canadian
Subsidiary in another Canadian Subsidiary, (e) loans to directors,
officers, employees, agents, customers or suppliers in the ordinary
course of business for reasonable business expenses, not to exceed in
the aggregate $2,500,000 at any one time, (f) the Investments set forth
on Schedule 8.6, (g) Investments made after the Closing Date by a
Credit Party in a Canadian Subsidiary not to exceed $20,000,000, in the
aggregate, during the term of this Credit Agreement at any one time
outstanding, (h) Investments made after the Closing Date by a Credit
Party in all Foreign Subsidiaries other than Canadian Subsidiaries not
to exceed $15,000,000, in the aggregate, during the term of this Credit
Agreement at any one time outstanding, (i) Investments in Permitted
Acquisitions not to exceed $15,000,000 in any one year or $30,000,000,
in the aggregate, during the term of this Credit Agreement, (j)
Investments in Capital Expenditures to the extent permitted by Section
8.15; provided, however, that Capital Expenditures which are Permitted
Acquisitions shall be limited as provided in the preceding subclause
(i), (k) Investments made as a result of the receipt of non-cash
consideration from an Asset Disposition permitted by this Credit
Agreement, (l) Investments in dealers and customers in the ordinary
course of business not in excess of $10,000,000 at any one time
outstanding, (m) Investments in dealers and customers received in
connection with any bankruptcy or reorganization of such dealer or
customer as a result of an Investment previously made in such dealer or
customer in accordance with the provisions of clause (l), (n)
Investments comprised of progress payments to suppliers and (o)
Investments not otherwise permitted by the other clauses of this
definition not to exceed $2,000,000, in the aggregate, at any one time
outstanding.
"Permitted Liens" means (a) Liens securing Credit Party
Obligations, (b) Liens for taxes not yet due or Liens for taxes being
contested in good faith by appropriate proceedings for which adequate
reserves determined in accordance with GAAP have been established (and
as to which the property subject to any such Lien is not yet subject to
22
foreclosure, sale or loss on account thereof), (c) Liens in
respect of property imposed by law arising in the ordinary course of
business such as materialmen's, mechanics', warehousemen's, carrier's,
landlords' and other nonconsensual statutory Liens which are not yet
due and payable, which have been in existence less than 90 days or
which are being contested in good faith by appropriate proceedings for
which adequate reserves determined in accordance with GAAP have been
established (and as to which the property subject to any such Lien is
not yet subject to foreclosure, sale or loss on account thereof), (d)
pledges or deposits made in the ordinary course of business to secure
payment of worker's compensation insurance, unemployment insurance,
pensions or social security programs, (e) Liens arising from good faith
deposits in connection with or to secure performance of tenders, bids,
leases, government contracts, performance and return-of-money bonds and
other similar obligations incurred in the ordinary course of business
(other than obligations in respect of the payment of borrowed money),
(f) Liens arising from good faith deposits in connection with or to
secure performance of statutory obligations and surety and appeal
bonds, (g) easements, rights-of-way, restrictions (including zoning
restrictions), minor defects or irregularities in title and other
similar charges or encumbrances not, in any material respect, impairing
the use of the encumbered property for its intended purposes, (h)
judgment Liens that would not constitute an Event of Default, (i) Liens
in connection with Indebtedness allowed under Section 8.1(f), (j) Liens
arising by virtue of any statutory or common law provision relating to
banker's liens, rights of setoff or similar rights as to deposit
accounts or other funds maintained with a creditor depository
institution, (k) Liens existing on the date hereof and identified on
Schedule 8.2; provided that no such Lien shall extend to any property
other than the property subject thereto on the Closing Date, (l)
Permitted Encumbrances (as defined in any Mortgage Document) and (m)
Liens on real property, equipment and fixtures acquired in connection
with a Permitted Acquisition; provided that (A) such Lien shall have
existed at the time such Permitted Acquisition was consummated, (B)
such Lien was not incurred in anticipation thereof and (C) such Lien
secures Indebtedness that is permitted by Section 8.1(m) and (D) such
Liens, in the aggregate, do not secure Indebtedness in excess of
$10,000,000 aggregate principal amount at any one time outstanding.
"Person" means any individual, partnership, joint venture,
firm, corporation, limited liability company, association, trust or
other enterprise (whether or not incorporated), or any Governmental
Authority.
23
"Plan" means any employee benefit plan (as defined in Section
3(3) of ERISA) which is covered by ERISA and with respect to which any
Credit Party or any of its Subsidiaries or any ERISA Affiliate is (or,
if such plan were terminated at such time, would under Section 4069 of
ERISA be deemed to be) an "employer" within the meaning of Section 3(5)
of ERISA.
"Pledge Agreements" means any Amended and Restated Pledge
Agreement executed and delivered by a Credit Party in favor of the
Collateral Agent, for the benefit of the Lenders, to secure its
obligations under the Credit Documents, as amended, modified, extended,
renewed or replaced from time to time.
"Prime Rate" means the per annum rate of interest established
from time to time by the Administrative Agent at its principal office
in Charlotte, North Carolina (or such other principal office of the
Administrative Agent as communicated in writing to the Borrower and the
Lenders) as its Prime Rate. Any change in the interest rate resulting
from a change in the Prime Rate shall become effective as of 12:01 a.m.
of the Business Day on which each change in the Prime Rate is announced
by the Administrative Agent. The Prime Rate is a reference rate used by
the Administrative Agent in determining interest rates on certain loans
and is not intended to be the lowest rate of interest charged on any
extension of credit to any debtor.
"Principal Amortization Payment" means a principal payment on
the Term Loans as set forth in Section 2.3(d).
"Principal Amortization Payment Date" means the date a
Principal Amortization Payment is due.
"Pro Forma" means, with respect to a Permitted Acquisition,
that such Permitted Acquisition shall be deemed to have occurred as of
the first day of the twelve month period ending as of the last day of
the most recent fiscal quarter for which the Lenders have received the
financial information required by Section 7.1(b).
"Public Equity Offering" means an underwritten primary public
offering of the common stock of the Parent pursuant to an effective
registration statement filed with the United States Securities and
Exchange Commission in accordance with the Securities Act (whether
alone or in conjunction with a secondary public offering).
24
"Real Properties" means the Mortgaged Properties and the
Leasehold Mortgaged Properties.
"Regulation D, G, U, or X" means Regulation D, G, U or X,
respectively, of the Board of Governors of the Federal Reserve System
as from time to time in effect and any successor to all or a portion
thereof.
"Release of Collateral Event" means the occurrence of either
of the following: (a) the Borrower receives (i) an investment grade
rating on its senior unsecured (non-credit enhanced) debt of at least
(I) BBB- or higher from S&P or an equivalent rating from S&P in the
event S&P changes its rating system and (II) Baa3 or higher from
Moody's or an equivalent rating from Moody's in the event Moody's
changes its rating system or (ii) a rating on its senior subordinated
(non-credit enhanced) debt of at least (I) BB+ or higher from S&P or an
equivalent rating from S&P in the event S&P changes its rating system
and (II) Ba1 or higher from Moody's or an equivalent rating from
Moody's in the event Moody's changes its rating system, or (b) the
Borrower receives at least $100,000,000 in Net Cash Proceeds from a
Public Equity Offering and, after giving effect thereto, the Leverage
Ratio is less than 2.5 to 1.0.
"Reportable Event" means a "reportable event" as defined in
Section 4043 of ERISA with respect to which the notice requirements to
the PBGC have not been waived.
"Required Lenders" means Lenders whose aggregate Credit
Exposure (as hereinafter defined) constitutes at least 51% of the
Credit Exposure of all Lenders at such time; provided, however, that if
any Lender shall be a Defaulting Lender at such time then there shall
be excluded from the determination of Required Lenders the aggregate
principal amount of Credit Exposure of such Lender at such time. For
purposes of the preceding sentence, the term "Credit Exposure" as
applied to each Lender shall mean (a) at any time prior to the
termination of the Commitments, the sum of (i) the Revolving Commitment
Percentage of such Lender multiplied by the Revolving Committed Amount,
plus (ii) the Term Loan Commitment Percentage of such Lender multiplied
by the aggregate principal amount of Term Loans outstanding at such
time, and (b) at any time after the termination of the Commitments, the
sum of (i) the principal balance of the outstanding Loans of such
Lender plus (ii) such Lender's Participation Interests in the face
amount of the outstanding Letters of Credit.
25
"Requirement of Law" means, as to any Person, the articles or
certificate of incorporation and by-laws or other organizational or
governing documents of such Person, and any law, treaty, rule or
regulation or final, non-appealable determination of an arbitrator or a
court or other Governmental Authority, in each case applicable to or
binding upon such Person or to which any of its material property is
subject.
"Revolving Committed Amount" means ONE HUNDRED THIRTY MILLION
DOLLARS ($130,000,000) or such lesser amount as the Revolving Committed
Amount may be reduced pursuant to Section 2.1(d) or Section 3.3(c).
"Revolving Loan Commitment Percentage" means, for each Lender,
the percentage identified as its Revolving Commitment Percentage on
Schedule 1.1(a), as such percentage may be modified in connection with
any assignment made in accordance with the provisions of Section 11.3.
"Revolving Loans" means the Revolving Loans made to the
Borrower pursuant to Section 2.1.
"Revolving Note" or "Revolving Notes" means the promissory
notes of the Borrower in favor of each of the Lenders evidencing the
Revolving Loans provided pursuant to Section 2.1, individually or
collectively, as appropriate, as such promissory notes may be amended,
modified, supplemented, extended, renewed or replaced from time to time
and as evidenced in the form of Exhibit 2.6(a).
"Revolving Loan Maturity Date" means December 17, 2002.
"S&P" means Standard & Poor's Ratings Group, a division of
McGraw Hill, Inc., or any successor or assignee of the business of such
division in the business of rating securities.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
"Security Agreements" means any Amended and Restated Security
Agreement executed and delivered by a Credit Party in favor of the
Collateral Agent for the benefit of the Lenders to secure its
obligations under the Credit Documents, as such may be amended,
modified, extended, renewed, restated or replaced from time to time.
26
"Shareholder Subordinated Indebtedness" means Indebtedness of
the Parent or the Borrower to any Initial Shareholder if the instrument
creating or evidencing such Indebtedness or pursuant to which such
Indebtedness is outstanding provides that such Indebtedness is
subordinated in right of payment to the Credit Party Obligations and
the Subordinated Debt and such Indebtedness does not require any
payment for any reason on or in respect thereof, whether principal,
interest or otherwise, except in additional Shareholder Subordinated
Indebtedness, at any time prior to the payment in full in cash of the
Credit Party Obligations and the Subordinated Debt, together with
interest and fees related thereto; provided that all documentation
evidencing the Shareholder Subordinated Indebtedness shall be
reasonably acceptable to the Required Lenders.
"Single Employer Plan" means any Plan which is covered by
Title IV of ERISA, but which is not a Multiemployer Plan.
"Solvent" means, with respect to any Person as of a particular
date, that on such date (a) such Person is able to pay its debts and
other liabilities, contingent obligations and other commitments as they
mature in the normal course of business, (b) such Person does not
intend to, and does not believe that it will, incur debts or
liabilities beyond such Person's ability to pay as such debts and
liabilities mature in their ordinary course, (c) such Person is not
engaged in a business or a transaction, and is not about to engage in a
business or a transaction, for which such Person's assets would
constitute unreasonably small capital after giving due consideration to
the prevailing practice in the industry in which such Person is engaged
or is to engage, (d) the fair value of the assets of such Person is
greater than the total amount of liabilities, including, without
limitation, contingent liabilities, of such Person and (e) the present
fair saleable value of the assets of such Person is not less than the
amount that will be required to pay the probable liability of such
Person on its debts as they become absolute and matured. In computing
the amount of contingent liabilities at any time, it is intended that
such liabilities will be computed at the amount which, in light of all
the facts and circumstances existing at such time, represents the
amount that can reasonably be expected to become an actual or matured
liability.
"Subordinated Debt" means the $165 million of Indebtedness
evidenced by the Indenture or by the guarantees thereof.
27
"Subsidiary" means, as to any Person, (a) any corporation more
than 50% of whose stock of any class or classes having by the terms
thereof ordinary voting power to elect a majority of the directors of
such corporation (irrespective of whether or not at the time, any class
or classes of such corporation shall have or might have voting power by
reason of the happening of any contingency) is at the time owned by
such Person directly or indirectly through Subsidiaries, and (b) any
partnership, association, joint venture or other entity in which such
person directly or indirectly through Subsidiaries has more than a 50%
equity interest at any time.
"Term Loans" means the Term Loans made to the Borrower
pursuant to Section 2.3(a).
"Term Loan Commitment Percentage" means, for each Lender, the
percentage identified as its Term Loan Commitment Percentage on
Schedule 1.1(a), as such percentage may be modified in connection with
any assignment made in accordance with the provisions of Section 11.3.
"Term Loan Committed Amount" means ONE HUNDRED MILLION DOLLARS
($100,000,000).
"Term Loan Maturity Date" means December 17, 2002.
"Term Loan Note" or "Term Loan Notes" means the promissory
notes of the Borrower in favor of each of the Lenders evidencing the
Term Loans provided pursuant to Section 2.3(a), individually or
collectively, as appropriate, as such promissory notes may be amended,
modified, supplemented, extended, renewed or replaced from time to time
as evidenced in the form of Exhibit 2.6(b).
"Termination Event" means (a) with respect to any Single
Employer Plan, the occurrence of a Reportable Event or the substantial
cessation of operations (within the meaning of Section 4062(e) of
ERISA); (b) the withdrawal of any Credit Party or any of its
Subsidiaries or any ERISA Affiliate from a Multiple Employer Plan
during a plan year in which it was a substantial employer (as such term
is defined in Section 4001(a)(2) of ERISA), or the termination of a
Multiple Employer Plan; (c) the distribution of a notice of intent to
terminate or the actual termination of a Plan pursuant to Section
4041(a)(2) or 4041A of ERISA; (d) the institution of proceedings to
terminate or the actual termination of a Plan by the PBGC under Section
4042 of ERISA; (e) any event or condition which might reasonably
28
constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any
Plan; or (f) the complete or partial withdrawal of any Credit Party or
any of its Subsidiaries or any ERISA Affiliate from a Multiemployer
Plan.
"TROLS" has the meaning set forth in the definition of
Indebtedness.
"Unused Commitment" means, for any period, the amount by which
(a) the then applicable aggregate Revolving Committed Amount exceeds
(b) the daily average sum for such period of the outstanding aggregate
principal amount of all Revolving Loans plus the aggregate amount of
LOC Obligations outstanding.
"Voting Stock" of a corporation means all classes of the
capital stock of such corporation then outstanding and normally
entitled to vote in the election of directors.
"Warburg" means Warburg, Xxxxxx Ventures, L.P.
"Working Capital" means, at any time, the excess of current
assets (excluding cash and Cash Equivalents) over current liabilities
(excluding the current portion of Funded Debt), as determined in
accordance with GAAP.
1.2. Computation of Time Periods and Other Definitional Provisions. For
purposes of computation of periods of time hereunder, the word "from" means
"from and including" and the words "to" and "until" each mean "to but
excluding." References in this Agreement to "Articles", "Sections", "Schedules"
or "Exhibits" shall be to Articles, Sections, Schedules or Exhibits of or to
this Agreement unless otherwise specifically provided.
1.3. Accounting Terms. Except as otherwise expressly provided herein,
all accounting terms used herein shall be interpreted, and all financial
statements and certificates and reports as to financial matters required to be
delivered to the Lenders hereunder shall be prepared, in accordance with GAAP
applied on a consistent basis. All financial statements delivered to the Lenders
hereunder shall be accompanied by a statement from the Borrower that GAAP has
not changed since the most recent financial statements delivered by the Borrower
to the Lenders or if GAAP has changed describing such changes in detail and
explaining how
29
such changes affect the financial statements. All calculations made for
the purposes of determining compliance with this Credit Agreement shall (except
as otherwise expressly provided herein) be made by application of GAAP applied
on a basis consistent with the most recent annual or quarterly financial
statements delivered pursuant to Section 7.1 (or, prior to the delivery of the
first financial statements pursuant to Section 7.1, consistent with the
financial statements described in Section 5.1(c)); provided, however, if (a) the
Borrower shall object to determining such compliance on such basis at the time
of delivery of such financial statements due to any change in GAAP or the rules
promulgated with respect thereto or (b) either Agent or the Required Lenders
shall so object in writing within 60 days after delivery of such financial
statements (or after the Lenders have been informed of the change in GAAP
affecting such financial statements, if later), then such calculations shall be
made on a basis consistent with the most recent financial statements delivered
by the Borrower to the Lenders as to which no such objection shall have been
made.
SECTION 2.
CREDIT FACILITIES
2.1. Revolving Loans.
(a) Revolving Loan Commitment. Subject to the terms and
conditions set forth herein, each Lender severally agrees to make
revolving loans (each a "Revolving Loan" and collectively the
"Revolving Loans") to the Borrower, in Dollars, at any time and from
time to time, during the period from and including the Effective Date
to but not including the Revolving Loan Maturity Date (or such earlier
date if the Revolving Committed Amount has been terminated as provided
herein); provided, however, that (i) the sum of the aggregate amount of
Revolving Loans outstanding plus the aggregate amount of LOC
Obligations outstanding shall not exceed the Revolving Committed Amount
and (ii) with respect to each individual Lender, the Lender's pro rata
share of outstanding Revolving Loans plus such Lender's pro rata share
of outstanding LOC Obligations shall not exceed such Lender's Revolving
Loan Commitment Percentage of the Revolving Committed Amount. Subject
to the terms of this Credit Agreement (including Section 3.3), the
Borrower may borrow, repay and reborrow Revolving Loans.
(b) Method of Borrowing for Revolving Loans. By no later
than 11:00 a.m. (i) on the date of the requested
30
borrowing of Revolving Loans that will be Base Rate Loans or
(ii) three Business Days prior to the date of the requested borrowing
of Revolving Loans that will be Eurodollar Loans, the Borrower shall
submit a written Notice of Borrowing in the form of Exhibit 2.1 to the
Administrative Agent setting forth (A) the amount requested, (B)
whether such Revolving Loans shall accrue interest at the Adjusted Base
Rate or the Adjusted Eurodollar Rate, (C) with respect to Revolving
Loans that will be Eurodollar Loans, the Interest Period applicable
thereto and (D) certification that the Borrower has complied in all
respects with Section 5.2. All Revolving Loans on the Effective Date
shall be Base Rate Loans. Thereafter, all or any portion of the
Revolving Loans may be converted into Eurodollar Loans in accordance
with the terms of Section 2.4;
(c) Funding of Revolving Loans. Upon receipt of a Notice of
Borrowing, the Administrative Agent shall promptly inform the
applicable Lenders as to the terms thereof. Each such Lender shall make
its Revolving Loan Commitment Percentage of the requested Revolving
Loans available to the Administrative Agent by 1:00 p.m. on the date
specified in the Notice of Borrowing by deposit, in Dollars, of
immediately available funds at the offices of the Administrative Agent
at its principal office in Charlotte, North Carolina or at such other
address as the Administrative Agent may designate in writing. The
amount of the requested Revolving Loans will then be made available to
the Borrower by the Administrative Agent by crediting the account of
the Borrower on the books of such office of the Administrative Agent,
to the extent the amount of such Revolving Loans are made available to
the Administrative Agent.
No Lender shall be responsible for the failure or delay by any
other Lender in its obligation to make Revolving Loans hereunder;
provided, however, that the failure of any Lender to fulfill its
obligations hereunder shall not relieve any other Lender of its
obligations hereunder. Unless the Administrative Agent shall have been
notified by any Lender prior to the date of any such Revolving Loan
that such Lender does not intend to make available to the
Administrative Agent its portion of the Revolving Loans to be made on
such date, the Administrative Agent may assume that such Lender has
made such amount available to the Administrative Agent on the date of
such Revolving Loans, and the Administrative Agent in reliance upon
such assumption, may (in its sole discretion but without any obligation
to do so) make available to the Borrower a corresponding amount. If
such corresponding amount is not in fact made available to the
Administrative
31
Agent, the Administrative Agent shall be able to recover such
corresponding amount from such Lender. If such Lender does not pay such
corresponding amount forthwith upon the Administrative Agent's demand
therefor, the Administrative Agent will promptly notify the Borrower,
and the Borrower shall immediately pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also be entitled
to recover from the Lender or the Borrower, as the case may be,
interest on such corresponding amount in respect of each day from the
date such corresponding amount was made available by the Administrative
Agent to the Borrower to the date such corresponding amount is
recovered by the Administrative Agent at a per annum rate equal to (i)
from the Borrower at the applicable rate for such Revolving Loan
pursuant to the Notice of Borrowing and (ii) from a Lender at the
Federal Funds Rate.
(d) Reductions of Revolving Committed Amount. Upon at least
three Business Days' notice, the Borrower shall have the right to
permanently terminate or reduce the aggregate unused amount of the
Revolving Committed Amount at any time or from time to time; provided
that (i) each partial reduction shall be in an aggregate amount at
least equal to $5,000,000 and in integral multiples of $1,000,000 above
such amount and (ii) no reduction shall be made which would reduce the
Revolving Committed Amount to an amount less than the aggregate amount
of outstanding Revolving Loans plus the aggregate amount of outstanding
LOC Obligations. Any reduction in (or termination of) the Revolving
Committed Amount shall be permanent and may not be reinstated.
2.2. Letter of Credit Subfacility.
(a) Issuance. Subject to the terms and conditions hereof and
of the LOC Documents, if any, and any other terms and conditions which
the Issuing Lender may reasonably require (so long as such terms and
conditions do not impose any financial obligation on or require any
Lien (not otherwise contemplated by this Agreement) to be given by any
Credit Party or conflict with any obligation of, or detract from any
action which may be taken by, any Credit Party or their Subsidiaries
under this Agreement), the Issuing Lender shall from time to time upon
request issue, in Dollars, and the LOC Participants shall participate
in, letters of credit (the "Letters of Credit") for the account of the
Borrower or any of its Subsidiaries, from the Effective Date until the
Revolving Loan Maturity Date, in a form reasonably acceptable to the
Issuing Lender; provided, however, that (i) the aggregate amount of LOC
Obligations shall not at any
32
time exceed TWENTY MILLION DOLLARS ($20,000,000), (ii) the sum
of the aggregate amount of LOC Obligations outstanding plus Revolving
Loans outstanding shall not exceed the Revolving Committed Amount and
(iii) with respect to each individual LOC Participant, the LOC
Participant's pro rata share of outstanding Revolving Loans plus its
pro rata share of outstanding LOC Obligations shall not exceed such LOC
Participant's Revolving Loan Commitment Percentage of the Revolving
Committed Amount. The issuance and expiry date of each Letter of Credit
shall be a Business Day. Except as otherwise expressly agreed upon by
all the LOC Participants, no Letter of Credit shall have an original
expiry date more than one year from the date of issuance, or as
extended, shall have an expiry date extending beyond the Revolving Loan
Maturity Date. Each Letter of Credit shall be either (x) a standby
letter of credit issued to support the obligations (including pension
or insurance obligations), contingent or otherwise, of the Borrower or
any of its Subsidiaries, or (y) a commercial letter of credit in
respect of the purchase of goods or services by the Borrower or any of
its Subsidiaries in the ordinary course of business; it being
understood that any Letter of Credit issued on behalf of a Foreign
Subsidiary must be permitted by the terms of Section 8.6. Each Letter
of Credit shall comply with the related LOC Documents.
(b) Notice and Reports. The request for the issuance of a
Letter of Credit shall be submitted to the Issuing Lender at least
three Business Days prior to the requested date of issuance. The
Issuing Lender will, at least quarterly and more frequently upon
request, provide to the Administrative Agent for dissemination to the
Lenders a detailed report specifying the Letters of Credit which are
then issued and outstanding and any activity with respect thereto which
may have occurred since the date of the prior report, and including
therein, among other things, the account party, the beneficiary, the
face amount, and the expiry date as well as any payments or expirations
which may have occurred. The Issuing Lender will further provide to the
Administrative Agent, promptly upon request, copies of the Letters of
Credit.
(c) Participations.
(i) On the Effective Date, each LOC Participant shall
automatically acquire a participation in the liability of the
Issuing Lender under each Existing Letter of Credit in an
amount equal to its Revolving Loan Commitment Percentage of
such Existing Letters of Credit. Each Existing Letter of
Credit shall be deemed
33
for all purposes of this Credit Agreement and the other
Credit Documents to be a Letter of Credit.
(ii) Each LOC Participant, upon issuance of a Letter
of Credit, shall be deemed to have purchased without recourse
a risk participation from the Issuing Lender in such Letter of
Credit and the obligations arising thereunder and any
collateral relating thereto, in each case in an amount equal
to its Revolving Loan Commitment Percentage of the obligations
under such Letter of Credit, and shall absolutely,
unconditionally and irrevocably assume, as primary obligor and
not as surety, and be obligated to pay to the Issuing Lender
therefor and discharge when due, its Revolving Loan Commitment
Percentage of the obligations arising under such Letter of
Credit. Without limiting the scope and nature of each LOC
Participant's participation in any Letter of Credit, to the
extent that the Issuing Lender has not been reimbursed as
required hereunder or under any such Letter of Credit, each
such LOC Participant shall pay to the Issuing Lender its
Revolving Loan Commitment Percentage of such unreimbursed
drawing in same day funds on the day of notification by the
Issuing Lender of an unreimbursed drawing pursuant to the
provisions of subsection (d) hereof. The obligation of each
LOC Participant to so reimburse the Issuing Lender shall be
absolute and unconditional and shall not be affected by the
occurrence of a Default, an Event of Default or any other
occurrence or event. Any such reimbursement shall not relieve
or otherwise impair the obligation of the Borrower or any
other Credit Party to reimburse the Issuing Lender under any
Letter of Credit, together with interest as hereinafter
provided.
(d) Reimbursement. In the event of any drawing under any
Letter of Credit, the Issuing Lender will promptly notify the Borrower.
Unless the Borrower shall immediately notify the Issuing Lender of its
intent to otherwise reimburse the Issuing Lender, the Borrower shall be
deemed to have requested a Revolving Loan at the Adjusted Base Rate in
the amount of the drawing as provided in subsection (e) hereof, the
proceeds of which will be used to satisfy the reimbursement
obligations. The Borrower shall reimburse the Issuing Lender on the day
of drawing under any Letter of Credit either with the proceeds of a
Revolving Loan obtained hereunder or otherwise in same day funds as
provided herein or in the LOC Documents. If the Borrower shall fail to
reimburse the Issuing Lender as provided hereinabove, the unreimbursed
amount of such drawing shall bear interest at a
34
per annum rate equal to the Base Rate plus the Applicable
Percentage for the Base Rate Loans that are Revolving Loans plus two
percent (2%). The Borrower's reimbursement obligations hereunder shall
be absolute and unconditional under all circumstances irrespective of
(but without waiver of) any rights of set-off, counterclaim or defense
to payment the applicable account party or the Borrower may claim or
have against the Issuing Lender, the Agent, the Lenders, the
beneficiary of the Letter of Credit drawn upon or any other Person,
including without limitation, any defense based on any failure of the
applicable account party, the Borrower or any other Credit Party to
receive consideration or the legality, validity, regularity or
unenforceability of the Letter of Credit. The Issuing Lender will
promptly notify the LOC Participants of the amount of any unreimbursed
drawing and each LOC Participant shall promptly pay to the
Administrative Agent for the account of the Issuing Lender, in Dollars
and in immediately available funds, the amount of such LOC
Participant's Revolving Loan Commitment Percentage of such unreimbursed
drawing. Such payment shall be made on the day such notice is received
by such Lender from the Issuing Lender if such notice is received at or
before 2:00 p.m., otherwise such payment shall be made at or before
12:00 Noon on the Business Day next succeeding the day such notice is
received. If such LOC Participant does not pay such amount to the
Issuing Lender in full upon such request, such LOC Participant shall,
on demand, pay to the Administrative Agent for the account of the
Issuing Lender interest on the unpaid amount during the period from the
date the LOC Participant received the notice regarding the unreimbursed
drawing until such LOC Participant pays such amount to the Issuing
Lender in full at a rate per annum equal to, if paid within two
Business Days of the date of drawing, the Federal Funds Rate and
thereafter at a rate equal to the Base Rate. Each LOC Participant's
obligation to make such payment to the Issuing Lender, and the right of
the Issuing Lender to receive the same, shall be absolute and
unconditional, shall not be affected by any circumstance whatsoever and
without regard to the termination of this Credit Agreement or the
Commitments hereunder, the existence of a Default or Event of Default
or the acceleration of the obligations hereunder and shall be made
without any offset, abatement, withholding or reduction whatsoever.
Simultaneously with the making of each such payment by a LOC
Participant to the Issuing Lender, such LOC Participant shall,
automatically and without any further action on the part of the Issuing
Lender or such LOC Participant, acquire a participation in an amount
equal to such payment (excluding the portion of such payment
constituting interest owing to the Issuing Lender)
35
in the related unreimbursed drawing portion of the LOC
Obligation and in the interest thereon and in the related LOC
Documents, and shall have a claim against the Borrower and the other
Credit Parties with respect thereto.
(e) Repayment with Revolving Loans. On any day on which the
Borrower shall have requested, or been deemed to have requested, a
Revolving Loan borrowing to reimburse a drawing under a Letter of
Credit, the Administrative Agent shall give notice to the applicable
Lenders that a Revolving Loan has been requested or deemed requested in
connection with a drawing under a Letter of Credit, in which case a
Revolving Loan borrowing comprised solely of Base Rate Loans (each such
borrowing, a "Mandatory Borrowing") shall be immediately made from all
applicable Lenders (without giving effect to any termination of the
Commitments pursuant to Section 9.2) pro rata based on each Lender's
respective Revolving Loan Commitment Percentage and the proceeds
thereof shall be paid directly to the Issuing Lender for application to
the respective LOC Obligations. Each such Lender hereby irrevocably
agrees to make such Revolving Loans immediately upon any such request
or deemed request on account of each such Mandatory Borrowing in the
amount and in the manner specified in the preceding sentence and on the
same such date notwithstanding (i) the amount of Mandatory Borrowing
may not comply with the minimum amount for borrowings of Revolving
Loans otherwise required hereunder, (ii) whether any conditions
specified in Section 5 are then satisfied, (iii) whether a Default or
Event of Default then exists, (iv) failure of any such request or
deemed request for Revolving Loans to be made by the time otherwise
required hereunder, (v) the date of such Mandatory Borrowing, or (vi)
any reduction in the Revolving Committed Amount or any termination of
the Commitments. In the event that any Mandatory Borrowing cannot for
any reason be made on the date otherwise required above (including,
without limitation, as a result of the commencement of a proceeding
under the Bankruptcy Code with respect to the Borrower or any other
Credit Party), then each such Lender hereby agrees that it shall
forthwith fund (as of the date the Mandatory Borrowing would otherwise
have occurred, but adjusted for any payments received from the Borrower
on or after such date and prior to such purchase) its Participation
Interest in the outstanding LOC Obligations; provided, further, that in
the event any Lender shall fail to fund its Participation Interest on
the day the Mandatory Borrowing would otherwise have occurred, then the
amount of such Lender's unfunded Participation Interest therein shall
bear interest payable to the Issuing Lender upon demand, at the rate
equal to, if
36
paid within two Business Days of such date, the Federal Funds
Rate, and thereafter at a rate equal to the Base Rate.
(f) Designation of Subsidiaries as Account Parties.
Notwithstanding anything to the contrary set forth in this Credit
Agreement, a Letter of Credit issued hereunder may contain a statement
to the effect that such Letter of Credit is issued for the account of a
Subsidiary of the Borrower; provided that notwithstanding such
statement, the Borrower shall be the actual account party for all
purposes of this Credit Agreement for such Letter of Credit and such
statement shall not affect the Borrower's reimbursement obligations
hereunder with respect to such Letter of Credit.
(g) Modification and Extension. The issuance of any
supplement, modification, amendment, renewal, or extensions to any
Letter of Credit shall, for purposes hereof, be treated in all respects
the same as the issuance of a new Letter of Credit hereunder.
(h) Uniform Customs and Practices. The Issuing Lender may have
the Letters of Credit be subject to The Uniform Customs and Practice
for Documentary Credits, as published as of the date of issue by the
International Chamber of Commerce (Publication No. 500 or the most
recent publication, the "UCP"), in which case the UCP may be
incorporated therein and deemed in all respects to be a part thereof.
(i) Responsibility of Issuing Lender. It is expressly
understood and agreed that the obligations of the Issuing Lender
hereunder to the LOC Participants are only those expressly set forth in
this Credit Agreement and that the Issuing Lender shall be entitled to
assume that the conditions precedent set forth in Section 5 have been
satisfied unless it shall have acquired actual knowledge that any such
condition precedent has not been satisfied; provided, however, that
nothing set forth in this Section 2.2 shall be deemed to prejudice the
right of any LOC Participant to recover from the Issuing Lender any
amounts made available by such LOC Participant to the Issuing Lender
pursuant to this Section 2.2 in the event that it is determined by a
court of competent jurisdiction that the payment with respect to a
Letter of Credit constituted gross negligence or willful misconduct on
the part of the Issuing Lender.
(j) Conflict with LOC Documents. In the event of any conflict
between this Credit Agreement and any LOC Document, this Credit
Agreement shall govern.
37
(k) Indemnification of Issuing Lender.
(i) In addition to its other obligations under this
Credit Agreement, the Borrower hereby agrees to protect,
indemnify, pay and save the Issuing Lender harmless from and
against any and all claims, demands, liabilities, damages,
losses, costs, charges and expenses (including reasonable
attorneys' fees) that the Issuing Lender may incur or be
subject to as a consequence, direct or indirect, of (A) the
issuance of any Letter of Credit or (B) the failure of the
Issuing Lender to honor a drawing under a Letter of Credit as
a result of any act or omission, whether rightful or wrongful,
of any present or future de jure or de facto government or
governmental authority (all such acts or omissions, herein
called "Government Acts").
(ii) As between the Borrower and the Issuing Lender,
the Borrower shall assume all risks of the acts, omissions or
misuse of any Letter of Credit by the beneficiary thereof. The
Issuing Lender shall not be responsible for: (A) the form,
validity, sufficiency, accuracy, genuineness or legal effect
of any document submitted by any party in connection with the
application for and issuance of any Letter of Credit, even if
it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (B) the
validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any Letter of
Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, that may prove to be invalid or
ineffective for any reason; (C) failure of the beneficiary of
a Letter of Credit to comply fully with conditions required in
order to draw upon a Letter of Credit; (D) errors, omissions,
interruptions or delays in transmission or delivery of any
messages, by mail, cable, telegraph, telex or otherwise,
whether or not they be in cipher; (E) errors in interpretation
of technical terms; (F) any loss or delay in the transmission
or otherwise of any document required in order to make a
drawing under a Letter of Credit or of the proceeds thereof;
and (G) any consequences arising from causes beyond the
control of the Issuing Lender, including, without limitation,
any Government Acts. None of the above shall affect, impair,
or prevent the vesting of the Issuing Lender's rights or
powers hereunder.
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(iii) In furtherance and extension and not in
limitation of the specific provisions hereinabove set forth,
any action taken or omitted by the Issuing Lender, under or in
connection with any Letter of Credit or the related
certificates, if taken or omitted in good faith, shall not put
the Issuing Lender under any resulting liability to the
Borrower or any other Credit Party. It is the intention of the
parties that this Credit Agreement shall be construed and
applied to protect and indemnify the Issuing Lender against
any and all risks involved in the issuance of the Letters of
Credit, all of which risks are hereby assumed by the Borrower,
including, without limitation, any and all risks of the acts
or omissions, whether rightful or wrongful, of any present or
future Government Acts. The Issuing Lender shall not, in any
way, be liable for any failure by the Issuing Lender or anyone
else to pay any drawing under any Letter of Credit as a result
of any Government Acts or any other cause beyond the control
of the Issuing Lender.
(iv) Nothing in this subsection (k) is intended to
limit the reimbursement obligation of the Borrower contained
in this Section 2.2. The obligations of the Borrower under
this subsection (k) shall survive the termination of this
Credit Agreement. No act or omission of any current or prior
beneficiary of a Letter of Credit shall in any way affect or
impair the rights of the Issuing Lender to enforce any right,
power or benefit under this Credit Agreement.
(v) Notwithstanding anything to the contrary
contained in this subsection (k), the Borrower shall have no
obligation to indemnify the Issuing Lender in respect of any
liability incurred by the Issuing Lender arising solely out of
the gross negligence or willful misconduct of the Issuing
Lender, as determined by a court of competent jurisdiction.
Nothing in this Agreement shall relieve the Issuing Lender of
any liability to the Borrower in respect of any action taken
by the Issuing Lender which action constitutes gross
negligence or willful misconduct of the Issuing Lender or a
violation of the UCP or Uniform Commercial Code (as
applicable), as determined by a court of competent
jurisdiction.
2.3. Term Loans.
(a) Term Loan. Subject to the terms and conditions set
forth herein, each Lender severally agrees, on the
39
Effective Date, to make a term loan (collectively, the "Term
Loans") to the Borrower, in Dollars, in an amount equal to such
Lender's Term Loan Commitment Percentage, if any, of the Term Loan
Committed Amount; provided that the aggregate amount of such Term Loans
made on the Effective Date shall not exceed the Term Loan Committed
Amount. Once repaid, Term Loans cannot be reborrowed.
(b) Funding of Term Loans. On the Effective Date, each
applicable Lender will make its Term Loan Commitment Percentage of the
Term Loan Committed Amount available to the Administrative Agent by
deposit, in Dollars and in immediately available funds, at the offices
of the Administrative Agent at its principal office in Charlotte, North
Carolina or at such other address as the Administrative Agent may
designate in writing. The amount of the Term Loans will then be made
available to the Borrower by the Administrative Agent by crediting the
account of the Borrower on the books of such office of the
Administrative Agent, to the extent the amount of such Term Loans are
made available to the Administrative Agent. All Term Loans on the
Effective Date shall be Base Rate Loans. Thereafter, all or any portion
of the Term Loans may be converted into Eurodollar Loans in accordance
with the terms of Section 2.4.
No Lender shall be responsible for the failure or delay by any
other Lender in its obligation to make a Term Loan hereunder; provided,
however, that the failure of any Lender to fulfill its obligations
hereunder shall not relieve any other Lender of its obligations
hereunder. If the Administrative Agent shall have received an executed
signature page to this Credit Agreement (whether an original or via
telecopy) from a Lender, the Administrative Agent may assume that such
Lender has or will make the amount of its Term Loans available to the
Administrative Agent on the Effective Date, and the Administrative
Agent in reliance upon such assumption, may (in its sole discretion but
without any obligation to do so) make available to the Borrower a
corresponding amount. If such corresponding amount is not in fact made
available to the Administrative Agent, the Administrative Agent shall
be able to recover such corresponding amount from such Lender. If such
Lender does not pay such corresponding amount forthwith upon the
Administrative Agent's demand therefor, the Administrative Agent will
promptly notify the Borrower, and the Borrower shall immediately pay
such corresponding amount to the Administrative Agent. The
Administrative Agent shall also be entitled to recover from the Lender
or the Borrower, as the case may be, interest on such corresponding
amount in respect
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of each day from the date such corresponding amount was made
available by the Administrative Agent to the Borrower to the date such
corresponding amount is recovered by the Administrative Agent at a per
annum rate equal to (i) from the Borrower at the applicable rate for
such Term Loan and (ii) from a Lender at the Federal Funds Rate.
(c) Amortization. The principal amount of the Term
Loans shall be repaid in quarterly payments on the dates set
forth below:
Principal Amortization Term Loan Principal
Payment Dates Amortization Payment
------------------- --------------------
March 31, 1997 $3,750,000
June 30, 1997 $3,750,000
September 30, 1997 $3,750,000
December 31, 1997 $3,750,000
March 31, 1998 $3,750,000
June 30, 1998 $3,750,000
September 30, 1998 $3,750,000
December 31, 1998 $3,750,000
March 31, 1999 $3,750,000
June 30, 1999 $3,750,000
September 30, 1999 $3,750,000
December 31, 1999 $3,750,000
March 31, 2000 $3,750,000
June 30, 2000 $3,750,000
September 30, 2000 $3,750,000
December 31, 2000 $3,750,000
March 31, 2001 $5,000,000
June 30, 2001 $5,000,000
September 30, 2001 $5,000,000
December 31, 2001 $5,000,000
March 31, 2002 $5,000,000
June 30, 2002 $5,000,000
September 30, 2002 $5,000,000
December __, 2002 $5,000,000
Total $100,000,000
2.4. Continuations and Conversions. The Borrower shall have the option,
on any Business Day, to continue existing Eurodollar Loans for a subsequent
Interest Period, to convert Base Rate Loans into Eurodollar Loans or to convert
Eurodollar Loans into Base Rate Loans; provided, however, that (a) each such
continuation or conversion must be requested by the Borrower pursuant to a
written Notice of Continuation/Conversion, in the form of Exhibit 2.4, in
compliance with the terms set forth below, (b) except as provided in Section
3.12, Eurodollar Loans
41
may only be continued or converted into Base Rate Loans on the last day
of the Interest Period applicable hereto, (c) after notice from the
Administrative Agent or the Required Lenders, Eurodollar Loans may not be
continued nor may Base Rate Loans be converted into Eurodollar Loans during the
existence and continuation of a Default or Event of Default and (d) any request
to extend a Eurodollar Loan that fails to comply with the terms hereof or any
failure to request an extension of a Eurodollar Loan at the end of an Interest
Period shall constitute a conversion to a Base Rate Loan on the last day of the
applicable Interest Period. Each continuation or conversion must be requested by
the Borrower no later than 11:00 a.m. (i) the date for a requested conversion of
a Eurodollar Loan to a Base Rate Loan or (ii) three Business Days prior to the
date for a requested continuation of a Eurodollar Loan or conversion of a Base
Rate Loan to a Eurodollar Loan, in each case pursuant to a written Notice of
Continuation/Conversion submitted to the Administrative Agent which shall set
forth (A) whether the Loans to be continued or converted are Revolving Loans or
Term Loans, (B) whether the Borrower wishes to continue or convert such Loans
and (C) if the request is to continue a Eurodollar Loan or convert a Base Rate
Loan to a Eurodollar Loan, the Interest Period applicable thereto.
2.5. Minimum Amounts. Each request for a borrowing, conversion or
continuation shall be subject to the requirements that (a) each Eurodollar Loan
shall be in a minimum amount of $5,000,000 and in integral multiples of
$1,000,000 in excess thereof, (b) each Base Rate Loan shall be in a minimum
amount of the lesser of $1,000,000 (and integral multiples of $500,000 in excess
thereof) or the remaining amount available under the Revolving Committed Amount
or the Term Loan Committed Amount, as applicable and (c) no more than ten
Eurodollar Loans shall be outstanding hereunder at any one time. For the
purposes of this Section, all Eurodollar Loans with the same Interest Periods
shall be considered as one Eurodollar Loan, but Eurodollar Loans with different
Interest Periods, even if they begin on the same date, shall be considered as
separate Eurodollar Loans.
2.6. Notes.
(a) Revolving Loan Notes. The Revolving Loans made by each
Lender shall be evidenced by a duly executed promissory note of the
Borrower to each applicable Lender in the face amount of its Revolving
Loan Commitment Percentage of the Revolving Committed Amount in
substantially the form of Exhibit 2.6(a).
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(b) Term Loan Notes. The Term Loan made by each Lender shall
be evidenced by a duly executed promissory note of the Borrower to each
applicable Lender in the face amount of its Term Loan Commitment
Percentage of the Term Loan Committed Amount in substantially the form
of Exhibit 2.6(b).
SECTION 3.
GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT
3.1. Interest.
(a) Interest Rate. All Base Rate Loans shall accrue
interest at the Adjusted Base Rate and all Eurodollar Loans shall
accrue interest at the Adjusted Eurodollar Rate.
(b) Default Rate of Interest. Upon the occurrence, and during
the continuance, of an Event of Default, the principal of and, to the
extent permitted by law, interest on the Loans and any other amounts
owing (but not timely paid) hereunder or under the other Credit
Documents (including without limitation fees and expenses) shall bear
interest, payable on demand, at a per annum rate equal to 2% plus the
rate which would otherwise be applicable (or if no rate is applicable,
then the rate for Revolving Loans that are Base Rate Loans plus two
percent (2%) per annum).
(c) Interest Payments. Interest on Loans shall be due and
payable in arrears on each Interest Payment Date. If an Interest
Payment Date falls on a date which is not a Business Day, such Interest
Payment Date shall be deemed to be the next succeeding Business Day,
except that in the case of Eurodollar Loans where the next succeeding
Business Day falls in the next succeeding calendar month, then on the
next preceding day.
3.2. Place and Manner of Payments. All payments of principal, interest,
fees, expenses and other amounts to be made by a Credit Party under this
Agreement shall be received not later than 2:00 p.m. on the date when due, in
Dollars and in immediately available funds, by the Administrative Agent at its
offices at NationsBank Corporate Center, Charlotte, North Carolina. Payments
received after such time shall be deemed to have been received on the next
Business Day. The Borrower shall, at the time it makes any payment under this
Agreement, specify to the Administrative Agent, the Loans, Letters of Credit,
fees or other
43
amounts payable by the Borrower hereunder to which such payment is to
be applied (and in the event that it fails to specify, or if such application
would be inconsistent with the terms hereof, the Administrative Agent shall,
subject to Section 3.7, distribute such payment to the Lenders in such manner as
the Administrative Agent may deem appropriate). The Administrative Agent will
distribute such payments to the applicable Lenders if any such payment is
received prior to 2:00 p.m.; otherwise the Administrative Agent will distribute
such payment to the applicable Lenders on the next succeeding Business Day.
Whenever any payment hereunder shall be stated to be due on a day which is not a
Business Day, the due date thereof shall be extended to the next succeeding
Business Day (subject to accrual of interest and fees for the period of such
extension), except that in the case of Eurodollar Loans, if the extension would
cause the payment to be made in the next following calendar month, then such
payment shall instead be made on the next preceding Business Day.
3.3. Prepayments.
(a) Voluntary Prepayments. The Borrower shall have the right
to prepay Loans in whole or in part from time to time without premium
or penalty; provided, however, that (i) Eurodollar Loans may only be
prepaid on three Business Days' prior written notice to the
Administrative Agent and any prepayment of Eurodollar Loans will be
subject to Section 3.15; (ii) each such partial prepayment of Loans
shall be in the minimum principal amount of $5,000,000 and integral
multiples of $1,000,000 in excess thereof and (iii) voluntary
prepayments with respect to the Term Loans shall be applied first in
direct order to the Principal Amortization Payments due during the
first twelve months following the date of such voluntary prepayment and
second pro rata among the remaining Principal Amortization Payments.
(b) Mandatory Prepayments.
(i) Revolving Committed Amount. If at any time the
sum of the aggregate amount of Revolving Loans outstanding
plus LOC Obligations outstanding exceeds the Revolving
Committed Amount, the Borrower shall immediately make a
principal payment to the Administrative Agent in the manner
and in an amount necessary to be in compliance with Section
2.1.
(ii) Asset Dispositions. Immediately upon
receipt by a Credit Party or any of its Subsidiaries of
proceeds from any Asset Disposition, the Borrower shall
forward 100% of the Net Cash Proceeds of such Asset
44
Disposition to the Lenders as a prepayment of the
Loans (to be applied as set forth in Section 3.3(c) below).
(c) Application of Prepayments. All amounts required to be
paid pursuant to Section 3.3(b)(i) shall be applied first to Revolving
Loans and second to a cash collateral account in respect of LOC
Obligations. All amounts required to be paid pursuant to Section
3.3(b)(ii) above shall be applied first, to the Term Loans (pro rata
among the remaining Principal Amortization Payments), second, to the
Revolving Loans (with a corresponding reduction in the Revolving
Committed Amount) and third, to a cash collateral account in respect of
LOC Obligations. Within the parameters of the application set forth
above, prepayments shall be applied first to Base Rate Loans and then
to Eurodollar Loans in direct order of Interest Period maturities. All
prepayments hereunder shall be subject to Section 3.15.
3.4. Fees.
(a) Commitment Fees. In consideration of the Revolving
Committed Amount being made available by the Lenders hereunder, the
Borrower agrees to pay to the Administrative Agent, for the pro rata
benefit of each applicable Lender (based on each Lender's Revolving
Loan Commitment Percentage of the Revolving Committed Amount), a fee
equal to the product of (a) the Applicable Percentage for Commitment
Fees multiplied by (b) the Unused Commitment (the "Commitment Fees").
The accrued Commitment Fees shall commence to accrue on the Effective
Date and shall be due and payable in arrears on the last Business Day
of each fiscal quarter of the Borrower (as well as on the Revolving
Loan Maturity Date and on any date that the Revolving Committed Amount
is reduced) for the immediately preceding fiscal quarter (or portion
thereof), beginning with the first of such dates to occur after the
Closing Date.
(b) Letter of Credit Fees.
(i) Letter of Credit Fee. In consideration of the
issuance of Letters of Credit hereunder, the Borrower agrees
to pay to the Issuing Lender for the pro rata benefit of the
applicable Lenders (based on each Lender's Revolving Loan
Commitment Percentage of the Revolving Committed Amount), a
fee (the "Letter of Credit Fee") equal to the Applicable
Percentage for the Letter of Credit Fee on the average daily
maximum amount available to be drawn under each such Letter of
Credit from the date of issuance to the date of
45
expiration. The Letter of Credit Fee will be payable
quarterly in arrears 15 days after the end of each fiscal
quarter of the Borrower and on the Revolving Loan Maturity
Date.
(ii) Issuing Lender Fees. In addition to the Letter
of Credit Fees payable pursuant to subsection (i) above, the
Borrower shall pay to the Issuing Lender for its own account,
without sharing by the other Lenders, (A) a fee equal to
one-fourth of one percent (.25%) per annum on the total sum of
all Letters of Credit issued by the Issuing Lender, such fee
to be paid quarterly in arrears 15 days after the end of each
fiscal quarter of the Borrower (as well as on the Revolving
Loan Maturity Date) and (B) the customary charges from time to
time to the Issuing Lender for its services in connection with
the issuance, amendment, payment, transfer, administration,
cancellation and conversion of, and drawings under, such
Letters of Credit (collectively, the "Issuing Lender Fees").
(c) Administrative Fees. The Borrower agrees to pay to the
Administrative Agent, for its own account, an annual fee as
agreed to between the Borrower and the Administrative Agent
in the Administrative Agent Fee Letter.
3.5. Payment in full at Maturity.
(a) On the Revolving Loan Maturity Date, the entire
outstanding principal balance of all Revolving Loans, together with
accrued but unpaid interest and all other sums owing with respect
thereto, shall be due and payable in full, unless accelerated sooner
pursuant to Section 9.
(b) On the Term Loan Maturity Date, the entire outstanding
principal balance of all Term Loans, together with accrued but unpaid
interest and all other sums owing with respect thereto, shall be due
and payable in full, unless accelerated sooner pursuant to Section 9.
3.6. Computations of Interest and Fees.
(a) Except for Base Rate Loans, in which case interest shall
be computed on the basis of a 365 or 366 day year as the case may be
(unless the Base Rate is determined by reference to the Federal Funds
Rate), all computations of interest and fees hereunder shall be made on
the basis of
46
the actual number of days elapsed over a year of 360 days.
Interest shall accrue from and include the date of borrowing (or
continuation or conversion) but exclude the date of payment.
(b) It is the intent of the Lenders and the Credit Parties to
conform to and contract in strict compliance with applicable usury law
from time to time in effect. All agreements between the Lenders and the
Borrower are hereby limited by the provisions of this paragraph which
shall override and control all such agreements, whether now existing or
hereafter arising and whether written or oral. In no way, nor in any
event or contingency (including but not limited to prepayment or
acceleration of the maturity of any obligation), shall the interest
taken, reserved, contracted for, charged, or received under this Credit
Agreement, under the Notes or otherwise, exceed the maximum nonusurious
amount permissible under applicable law. If, from any possible
construction of any of the Credit Documents or any other document,
interest would otherwise be payable in excess of the maximum
nonusurious amount, any such construction shall be subject to the
provisions of this paragraph and such documents shall be automatically
reduced to the maximum nonusurious amount permitted under applicable
law, without the necessity of execution of any amendment or new
document. If any Lender shall ever receive anything of value which is
characterized as interest on the Loans under applicable law and which
would, apart from this provision, be in excess of the maximum lawful
amount, an amount equal to the amount which would have been excessive
interest shall, without penalty, be applied to the reduction of the
principal amount owing on the Loans and not to the payment of interest,
or refunded to the Borrower or the other payor thereof if and to the
extent such amount which would have been excessive exceeds such unpaid
principal amount of the Loans. The right to demand payment of the Loans
or any other indebtedness evidenced by any of the Credit Documents does
not include the right to receive any interest which has not otherwise
accrued on the date of such demand, and the Lenders do not intend to
charge or receive any unearned interest in the event of such demand.
All interest paid or agreed to be paid to the Lenders with respect to
the Loans shall, to the extent permitted by applicable law, be
amortized, prorated, allocated, and spread throughout the full stated
term (including any renewal or extension) of the Loans so that the
amount of interest on account of such indebtedness does not exceed the
maximum nonusurious amount permitted by applicable law.
47
3.7. Pro Rata Treatment. Except to the extent otherwise provided
herein:
(a) Loans. Each Revolving Loan borrowing (including, without
limitation, each Mandatory Borrowing), each payment or prepayment of
principal of any Loan, each payment of fees (other than the Issuing
Lender Fees retained by the Issuing Lender for its own account and the
administrative fees retained by the Administrative Agent for its own
account), each reduction of the Revolving Committed Amount, and each
conversion or continuation of any Loan, shall be allocated pro rata
among the relevant Lenders in accordance with the respective Revolving
Loan Commitment Percentages and Term Loan Commitment Percentages, as
applicable, of such Lenders (or, if the Commitments of such Lenders
have expired or been terminated, in accordance with the respective
principal amounts of the outstanding Loans and Participation Interests
of such Lenders); provided that, if any Lender shall have failed to pay
its applicable pro rata share of any Revolving Loan, then any amount to
which such Lender would otherwise be entitled pursuant to this
subsection (a) shall instead be payable to the Administrative Agent;
provided further, that in the event any amount paid to any Lender
pursuant to this subsection (a) is rescinded or must otherwise be
returned by the Administrative Agent, each Lender shall, upon the
request of the Administrative Agent, repay to the Administrative Agent
the amount so paid to such Lender, with interest for the period
commencing on the date such payment is returned by the Administrative
Agent until the date the Administrative Agent receives such repayment
at a rate per annum equal to, during the period to but excluding the
date two Business Days after such request, the Federal Funds Rate, and
thereafter, the Base Rate plus two percent (2%) per annum; and
(b) Letters of Credit. Each payment of unreimbursed drawings
in respect of LOC Obligations shall be allocated to each LOC
Participant pro rata in accordance with its Revolving Loan Commitment
Percentage; provided that, if any LOC Participant shall have failed to
pay its applicable pro rata share of any drawing under any Letter of
Credit, then any amount to which such LOC Participant would otherwise
be entitled pursuant to this subsection (b) shall instead be payable to
the Issuing Lender; provided further, that in the event any amount paid
to any LOC Participant pursuant to this subsection (b) is rescinded or
must otherwise be returned by the Issuing Lender, each LOC Participant
shall, upon the request of the Issuing Lender, repay to the
Administrative Agent for the account of the Issuing Lender the amount
so paid to such LOC Participant, with interest
48
for the period commencing on the date such payment is returned
by the Issuing Lender until the date the Issuing Lender receives such
repayment at a rate per annum equal to, during the period to but
excluding the date two Business Days after such request, the Federal
Funds Rate, and thereafter, the Base Rate plus two percent (2%) per
annum.
3.8. Allocation of Payments After Event of Default. Notwithstanding any
other provisions of this Credit Agreement, after the occurrence and during the
continuance of an Event of Default, all amounts collected or received by an
Agent or any Lender on account of amounts outstanding under any of the Credit
Documents or in respect of the Collateral shall be paid over or delivered as
follows:
FIRST, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation reasonable attorneys' fees)
of the Agents in connection with enforcing the rights of the Lenders
under the Credit Documents and any protective advances made by the
Agents with respect to the Collateral under or pursuant to the terms of
the Collateral Documents;
SECOND, to payment of any fees owed to an Agent or a Issuing
Lender;
THIRD, to the payment of all reasonable out-of-pocket costs
and expenses, (including, without limitation, reasonable attorneys'
fees) of each of the Lenders in connection with enforcing its rights
under the Credit Documents;
FOURTH, to the payment of all accrued fees and interest
payable to the Lenders hereunder;
FIFTH, to the payment of the outstanding principal amount of
the Loans, to the payment or cash collateralization of the outstanding
LOC Obligations and to any principal amounts outstanding under Hedging
Agreements, pro rata, as set forth below;
SIXTH, to all other obligations which shall have become due
and payable under the Credit Documents and not repaid pursuant to
clauses "FIRST" through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whoever may
be lawfully entitled to receive such surplus.
49
In carrying out the foregoing, (a) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; (b) each of the Lenders shall receive an amount equal to
its pro rata share (based on the proportion that the then outstanding Loans, LOC
Obligations and obligations under Hedging Agreements held by such Lender bears
to the aggregate then outstanding Loans, LOC Obligations and obligations under
Hedging Agreements) of amounts available to be applied pursuant to clauses
"THIRD", "FOURTH," "FIFTH," and "SIXTH" above; and (c) to the extent that any
amounts available for distribution pursuant to clause "FIFTH" above are
attributable to the issued but undrawn amount of outstanding Letters of Credit,
such amounts shall be held by the Collateral Agent in a cash collateral account
and applied (x) first, to reimburse the Issuing Lender from time to time for any
drawings under such Letters of Credit and (y) then, following the expiration of
all Letters of Credit, to all other obligations of the types described in
clauses "FIFTH" and "SIXTH" above in the manner provided in this Section 3.8.
3.9. Sharing of Payments. The Lenders agree among themselves that,
except to the extent otherwise provided herein, in the event that any Lender
shall obtain payment in respect of any Loan, unreimbursed drawing with respect
to any LOC Obligations or any other obligation owing to such Lender under this
Credit Agreement through the exercise of a right of setoff, banker's lien or
counterclaim, or pursuant to a secured claim under Section 506 of the Bankruptcy
Code or other security or interest arising from, or in lieu of, such secured
claim, received by such Lender under any applicable bankruptcy, insolvency or
other similar law or otherwise, or by any other means, in excess of its pro rata
share of such payment as provided for in this Credit Agreement, such Lender
shall promptly pay in cash or purchase from the other Lenders a participation in
such Loans, LOC Obligations, and other obligations in such amounts, and make
such other adjustments from time to time, as shall be equitable to the end that
all Lenders share such payment in accordance with their respective ratable
shares as provided for in this Credit Agreement. The Lenders further agree among
themselves that if payment to a Lender obtained by such Lender through the
exercise of a right of setoff, banker's lien, counterclaim or other event as
aforesaid shall be rescinded or must otherwise be restored, each Lender which
shall have shared the benefit of such payment shall, by payment in cash or a
repurchase of a participation theretofore sold, return its share of that benefit
(together with its share of any accrued interest payable with respect thereto)
to each Lender whose payment shall have been rescinded or otherwise restored.
The Borrower agrees that any Lender so purchasing such
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a participation may, to the fullest extent permitted by law, exercise
all rights of payment, including setoff, banker's lien or counterclaim, with
respect to such participation as fully as if such Lender were a holder of such
Loan, LOC Obligation or other obligation in the amount of such participation.
Except as otherwise expressly provided in this Credit Agreement, if any Lender
or an Agent shall fail to remit to an Agent or any other Lender an amount
payable by such Lender or such Agent to such Agent or such other Lender pursuant
to this Credit Agreement on the date when such amount is due, such payments
shall be made together with interest thereon for each date from the date such
amount is due until the date such amount is paid to such Agent or such other
Lender at a rate per annum equal to the Federal Funds Rate. If under any
applicable bankruptcy, insolvency or other similar law, any Lender receives a
secured claim in lieu of a setoff to which this Section 3.9 applies, such Lender
shall, to the extent practicable, exercise its rights in respect of such secured
claim in a manner consistent with the rights of the Lenders under this Section
3.9 to share in the benefits of any recovery on such secured claim.
3.10. Capital Adequacy. If, after the date hereof, any Lender has
determined that the adoption or the becoming effective of, or any change in, or
any change by any Governmental Authority, central bank or comparable agency
charged with the interpretation or administration thereof in the interpretation
or administration of, any applicable law, rule or regulation regarding capital
adequacy, or compliance by such Lender, or its parent corporation, 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, has or would
have the effect of reducing the rate of return on such Lender's (or parent
corporation's) capital or assets as a consequence of its commitments or
obligations hereunder to a level below that which such Lender, or its parent
corporation, could have achieved but for such adoption, effectiveness, change or
compliance (taking into consideration such Lender's (or parent corporation's)
policies with respect to capital adequacy), then, upon notice from such Lender
to the Borrower, the Borrower shall be obligated to pay to such Lender such
additional amount or amounts as will compensate such Lender on an after-tax
basis (after taking into account applicable deductions and credits in respect of
the amount indemnified) for such reduction. Each determination by any such
Lender of amounts owing under this Section shall, absent manifest error, be
conclusive and binding on the parties hereto. This covenant shall survive the
termination of this Credit Agreement and the payment of the Loans and all other
amounts payable hereunder. No Lender or parent corporation shall be
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entitled to receive any compensation for such amounts incurred more than
180 days prior to delivery of such notice.
3.11. Inability To Determine Interest Rate. If prior to the first day
of any Interest Period, the Administrative Agent shall have determined in good
faith (which determination shall be conclusive and binding upon the Borrower)
that, by reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Eurodollar Rate for such
Interest Period, the Administrative Agent shall give telecopy or telephonic
notice thereof to the Borrower and the Lenders as soon as practicable
thereafter, and will also give prompt written notice to the Borrower when such
conditions no longer exist. If such notice is given (a) any Eurodollar Loans
requested to be made on the first day of such Interest Period shall be made as
Base Rate Loans, (b) any Loans that were to have been converted on the first day
of such Interest Period to or continued as Eurodollar Loans shall be converted
to or continued as Base Rate Loans and (c) any outstanding Eurodollar Loans
shall be converted, on the first day of such Interest Period, to Base Rate
Loans. Until such notice has been withdrawn by the Agent, no further Eurodollar
Loans shall be made or continued as such, nor shall the Borrower have the right
to convert Base Rate Loans to Eurodollar Loans.
3.12. Illegality. Notwithstanding any other provision herein, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof occurring after the Closing Date shall make it unlawful for
any Lender to make or maintain Eurodollar Loans as contemplated by this Credit
Agreement, (a) such Lender shall promptly give written notice of such
circumstances to the Borrower and the Administrative Agent (which notice shall
be withdrawn whenever such circumstances no longer exist), (b) the commitment of
such Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as
such and convert a Base Rate Loan to Eurodollar Loans shall forthwith be
canceled and, until such time as it shall no longer be unlawful for such Lender
to make or maintain Eurodollar Loans, such Lender shall then have a commitment
only to make a Base Rate Loan when a Eurodollar Loan is requested and (c) such
Lender's Loans then outstanding as Eurodollar Loans, if any, shall be converted
automatically to Base Rate Loans on the respective last days or the then current
Interest Periods with respect to such Loans or within such earlier period as
required by law. If any such conversion of a Eurodollar Loan occurs on a day
which is not the last day of the then current Interest Period with respect
thereto, the Borrower shall pay to such Lender such amounts, if any, as may be
required pursuant to Section 3.15.
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3.13. Requirements of Law. If the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof applicable to
any Lender, or compliance by any Lender with any request or directive (whether
or not having the force of law) from any central bank or other Governmental
Authority, in each case made subsequent to the Closing Date (or, if later, the
date on which such Lender becomes a Lender):
(a) shall subject such Lender to any tax of any kind
whatsoever with respect to any Letter of Credit, any Eurodollar Loans
made by it or its obligation to make Eurodollar Loans, or change the
basis of taxation of payments to such Lender in respect thereof (except
for Non-Excluded Taxes covered by Section 3.14 (including Non-Excluded
Taxes imposed solely by reason of any failure of such Lender to comply
with its obligations under Section 3.14(b)) and changes in taxes
measured by or imposed upon the overall net income, or franchise tax
(imposed in lieu of such net income tax), of such Lender or its
applicable lending office, branch, or any affiliate thereof);
(b) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of,
advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender which is not
otherwise included in the determination of the Eurodollar Rate
hereunder; or
(c) shall impose on such Lender any other condition
(excluding any tax of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, upon notice to the Borrower from such Lender,
through the Agent, in accordance herewith, the Borrower shall be obligated to
promptly pay such Lender, upon its demand, any additional amounts necessary to
compensate such Lender on an after-tax basis (after taking into account
applicable deductions and credits in respect of the amount indemnified) for such
increased cost or reduced amount receivable, provided that, in any such case,
the Borrower may elect to convert the Eurodollar Loans made by such Lender
hereunder to Base Rate Loans by giving the Administrative Agent at least one
Business Day's notice of such election, in which case the Borrower shall
promptly pay to such
53
Lender, upon demand, without duplication, such amounts, if any, as may be
required pursuant to Section 3.15. If any Lender becomes entitled to claim any
additional amounts pursuant to this Section 3.13, it shall provide prompt notice
thereof to the Borrower, through the Administrative Agent, certifying (x) that
one of the events described in this Section 3.13 has occurred and describing in
reasonable detail the nature of such event, (y) as to the increased cost or
reduced amount resulting from such event and (z) as to the additional amount
demanded by such Lender and a reasonably detailed explanation of the calculation
thereof. Such a certificate as to any additional amounts payable pursuant to
this Section 3.13 submitted by such Lender, through the Administrative Agent, to
the Borrower shall be conclusive and binding on the parties hereto in the
absence of manifest error. This covenant shall survive the termination of this
Credit Agreement and the payment of the Loans and all other amounts payable
hereunder. No Lender shall be entitled to receive any compensation for such
amounts incurred more than 180 days prior to delivery of such certificate.
3.14. Taxes.
(a) Except as provided below in this Section 3.14, all
payments made by the Borrower under this Credit Agreement and any Notes
shall be made free and clear of, and without deduction or withholding
for or on account of, any present or future income, stamp or other
taxes, levies, imposts, duties, charges, fees, deductions or
withholdings, now or hereafter imposed, levied, collected, withheld or
assessed by any court, or governmental body, agency or other official,
excluding taxes measured by or imposed upon the overall net income of
any Lender or its applicable lending office, or any branch or affiliate
thereof, and all franchise taxes, branch taxes, taxes on doing business
or taxes on the overall capital or net worth of any Lender or its
applicable lending office, or any branch or affiliate thereof, in each
case imposed in lieu of net income taxes, imposed: (i) by the
jurisdiction under the laws of which such Lender, applicable lending
office, branch or affiliate is organized or is located, or in which its
principal executive office is located, or any nation within which such
jurisdiction is located or any political subdivision thereof; or (ii)
by reason of any connection between the jurisdiction imposing such tax
and such Lender, applicable lending office, branch or affiliate other
than a connection arising solely from such Lender having executed,
delivered or performed its obligations, or received payment under or
enforced, this Credit Agreement or any Notes. If any such non-excluded
taxes, levies, imposts, duties, charges, fees, deductions or
withholdings ("Non-Excluded Taxes") are
required to be withheld from any amounts payable to an Agent
or any Lender hereunder or under any Notes, (A) the amounts so payable
to an Agent or such Lender shall be increased to the extent necessary
to yield to an Agent or such Lender (after payment of all Non-Excluded
Taxes) interest or any such other amounts payable hereunder at the
rates or in the amounts specified in this Credit Agreement and any
Notes, provided, however, that the Borrower shall be entitled to deduct
and withhold any Non-Excluded Taxes and shall not be required to
increase any such amounts payable to any Lender that is not organized
under the laws of the United States of America or a state thereof if
such Lender fails to comply with the requirements of paragraph (b) of
this Section 3.14 whenever any Non-Excluded Taxes are payable by the
Borrower, and (B) as promptly as possible thereafter the Borrower shall
send to such Agent for its own account or for the account of such
Lender, as the case may be, a certified copy of an original official
receipt received by the Borrower showing payment thereof. If the
Borrower fails to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fails to remit to the Administrative
Agent the required receipts or other required documentary evidence, the
Borrower shall indemnify an Agent and any Lender for any incremental
taxes, interest or penalties that may become payable by an Agent or any
Lender as a result of any such failure. If a Lender shall change its
office that makes or maintains a Loan hereunder, the Borrower shall not
be required to pay any increased amounts to the Lender in respect of
any Non-Excluded Taxes pursuant to this subsection 3.14 to the extent
that any obligation to withhold or deduct any amount with respect to
such Non-Excluded Taxes existed on the date the Lender changed such
office, unless the Lender changed the office at the request of the
Borrower. The agreements in this subsection shall survive the
termination of this Credit Agreement and the payment of the Loans and
all other amounts payable hereunder.
(b) Each Lender that is not incorporated under the laws of the
United States of America or a state thereof shall:
(i)(A) on or before the date of any payment by the
Borrower under this Credit Agreement or Notes to such Lender,
deliver to the Borrower and the Administrative Agent (x) two
duly completed copies of United States Internal Revenue
Service Form 1001 or 4224, or successor applicable form, as
the case may be, certifying that it is entitled to receive
payments under this Credit Agreement and any Notes without
54
deduction or withholding of any United States federal
income taxes and (y) an Internal Revenue Service Form W-8 or
W-9, or successor applicable form, as the case may be,
certifying that it is entitled to an exemption from United
States backup withholding tax;
(B) deliver to the Borrower and the Administrative
Agent two further copies of any such form or certification on
or before the date that any such form or certification expires
or becomes obsolete and after the occurrence of any event
requiring a change in the most recent form previously
delivered by it to the Borrower; and
(C) obtain such extensions of time for filing and
complete such forms or certifications as may reasonably be
requested by the Borrower or the Administrative Agent; or
(ii) in the case of any such Lender that is not a
"bank" within the meaning of Section 881(c)(3)(A) of the
Internal Revenue Code, (A) represent to the Borrower (for the
benefit of the Borrower and the Agents) that it is not a bank
within the meaning of Section 881(c)(3)(A) of the Internal
Revenue Code, (B) agree to furnish to the Borrower, on or
before the date of any payment by the Borrower, with a copy to
the Administrative Agent, two accurate and complete original
signed copies of Internal Revenue Service Form W-8, or
successor applicable form certifying to such Lender's legal
entitlement at the date of such certificate to an exemption
from U.S. withholding tax under the provisions of Section
881(c) of the Internal Revenue Code with respect to payments
to be made under this Credit Agreement and any Notes (and to
deliver to the Borrower and the Administrative Agent two
further copies of such form on or before the date it expires
or becomes obsolete and after the occurrence of any event
requiring a change in the most recently provided form and, if
necessary, obtain any extensions of time reasonably requested
by the Borrower or the Administrative Agent for filing and
completing such forms), and (C) agree, to the extent legally
entitled to do so, upon reasonable request by the Borrower, to
provide to the Borrower (for the benefit of the Borrower and
the Agents) such other forms as may be reasonably required in
order to establish the legal entitlement of such Lender to an
exemption from withholding with respect to payments under this
Credit Agreement and any Notes.
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Notwithstanding the above, if any change in treaty, law or regulation
has occurred after the date such Person becomes a Lender hereunder
which renders all such forms inapplicable or which would prevent such
Lender from duly completing and delivering any such form with respect
to it and such Lender so advises the Borrower and the Administrative
Agent then such Lender shall be exempt from such requirements. Each
Person that shall become a Lender or a participant of a Lender pursuant
to Section 11.3 shall, upon the effectiveness of the related transfer,
be required to provide all of the forms, certifications and statements
required pursuant to this subsection (b); provided that in the case of
a participant of a Lender, the obligations of such participant of a
Lender pursuant to this subsection (b) shall be determined as if the
participant of a Lender were a Lender except that such participant of a
Lender shall furnish all such required forms, certifications and
statements to the Lender from which the related participation shall
have been purchased.
(c) If any such taxes shall be or become applicable after the
date of this Agreement to such payments by the Borrower to a Lender,
such Lender shall use reasonable efforts to make, fund or maintain the
Loan or Loans, as the case may be, through another lending office
located in another jurisdiction so as to reduce, to the fullest extent
possible, the Borrower's liability hereunder, if the making, funding or
maintenance of such Loan or Loans through such other office does not,
in the reasonable judgment of the Lender, materially affect the Lender
of such Loan. If the Borrower is required to make any additional
payment to a Lender pursuant to this Section 3.14, and any such Lender
receives, or is entitled to receive, a credit against, remission for,
or repayment of, any tax paid or payable by it in respect of, or
calculated with reference to, the taxes giving rise to such payment,
such Lender shall, within a reasonable time after it receives such
credit, relief, remission or repayment, reimburse the Borrower the
amount of any such credit, relief, remission or repayment.
3.15. Indemnity. The Borrower promises to indemnify each Lender and to
hold each Lender harmless from any loss or expense which such Lender may sustain
or incur (other than through such Lender's gross negligence or willful
misconduct) as a consequence of (a) default by the Borrower in making a
borrowing of, conversion into or continuation of Eurodollar Loans after the
Borrower has given a notice requesting the same in accordance with the
provisions of this Credit Agreement, (b) default by the Borrower in making any
prepayment of a Eurodollar Loan after the Borrower has given a
56
notice thereof in accordance with the provisions of this Credit Agreement and
(c) the making of a prepayment of Eurodollar Loans on a day which is not the
last day of an Interest Period with respect thereto. Such indemnification may
include an amount equal to (i) the present value of the amount of interest which
would have accrued on the amount so prepaid, or not so borrowed, converted or
continued, for the period from the date of such prepayment or of such failure to
borrow, convert or continue to the last day of the applicable Interest Period
(or, in the case of a failure to borrow, convert or continue, the Interest
Period that would have commenced on the date of such failure) in each case at
the applicable rate of interest for such Eurodollar Loans provided for herein
(excluding, however, the Applicable Percentage included therein, if any) minus
(ii) the amount of interest (as reasonably determined by such Lender) which
would have accrued to such Lender on such amount by placing such amount on
deposit for a comparable period with leading banks in the interbank Eurodollar
market. The agreements in this Section shall survive the termination of this
Credit Agreement and the payment of the Loans and all other amounts payable
hereunder.
3.16. Replacement Lenders. At any time after the payment by the
Borrower to any Lender of any amount pursuant to Section 3.13 or 3.14 that the
Borrower reasonably deems material, the Borrower may, by writing addressed to
the Administrative Agent and each Lender that requested the payment of such
amount, nominate or propose an Eligible Assignee that is willing to become the
assignee of the Commitment and other obligations of such Lender (a "Replacement
Lender") pursuant to Section 11.3, and within fifteen (15) Business Days after
receipt of such proposal from the Borrower, each such Lender shall execute and
deliver to the Administrative Agent an Assignment Agreement whereby such Lender
shall assign its entire Commitment in favor of the proposed Replacement Lender
in accordance with Section 11.3 unless, prior to the expiration of such period,
the Administrative Agent shall have notified the Borrower and such Lender that
the proposed Replacement Lender is not reasonably acceptable to the
Administrative Agent; provided, that in no event will (i) any Lender be required
to enter into an Assignment Agreement at a price less than par plus accrued
interest and prorated fees and other costs due hereunder to the effective date
thereof, (ii) the Administrative Agent or any Lender be obligated to assist the
Borrower in identifying any Eligible Assignees that are willing to become such a
Replacement Lender or (iii) any such assignment be required if the consummation
thereof conflicts with any Requirement of Law.
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SECTION 4.
GUARANTY
4.1. Guaranty of Payment. Subject to Section 4.7 below, each of the
Guarantors hereby, jointly and severally, unconditionally guarantees to each
Lender, each Affiliate of Lender that enters into a Hedging Agreement and the
Agents the prompt payment of the Credit Party Obligations in full when due
(whether at stated maturity, as a mandatory prepayment, by acceleration or
otherwise). The Guarantors additionally, jointly and severally, unconditionally
guarantee to each Lender the timely performance of all other obligations under
the Credit Documents and the Hedging Agreements. This Guaranty is a guaranty of
payment and not of collection and is a continuing guaranty and shall apply to
all Credit Party Obligations whenever arising.
4.2. Obligations Unconditional. The obligations of the Guarantors
hereunder are absolute and unconditional, irrespective of the value,
genuineness, validity, regularity or enforceability of any of the Credit
Documents or the Hedging Agreements, or any other agreement or instrument
referred to therein, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever which might otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor.
Each Guarantor agrees that this Guaranty may be enforced by the Lenders without
the necessity at any time of resorting to or exhausting any other security or
collateral and without the necessity at any time of having recourse to the Notes
or any other of the Credit Documents or any collateral, if any, hereafter
securing the Credit Party Obligations or otherwise and each Guarantor hereby
waives the right to require the Lenders to proceed against the Borrower or any
other Person (including a co-guarantor) or to require the Lenders to pursue any
other remedy or enforce any other right. Each Guarantor further agrees that it
shall have no right of subrogation, indemnity, reimbursement or contribution
against the Borrower or any other Guarantor of the Credit Party Obligations for
amounts paid under this Guaranty until such time as the Lenders (and any
Affiliates of Lenders entering into Hedging Agreements) have been paid in full,
all Commitments under the Credit Agreement have been terminated and no Person or
Governmental Authority shall have any right to request any return or
reimbursement of funds from the Lenders in connection with monies received under
the Credit Documents. Each Guarantor further agrees that nothing contained
herein shall prevent the Lenders from suing on the Notes or any of the other
Credit Documents or any of the Hedging Agreements or foreclosing its security
interest in or Lien on any collateral, if any, securing the Credit Party
Obligations or from exercising any other rights available to it under this
Credit Agreement, the Notes, any other of the Credit Documents, or any other
instrument
58
of security, if any, and the exercise of any of the aforesaid rights and the
completion of any foreclosure proceedings shall not constitute a discharge of
any of any Guarantor's obligations hereunder; it being the purpose and intent of
each Guarantor that its obligations hereunder shall be absolute, independent and
unconditional under any and all circumstances. Neither any Guarantor's
obligations under this Guaranty nor any remedy for the enforcement thereof shall
be impaired, modified, changed or released in any manner whatsoever by an
impairment, modification, change, release or limitation of the liability of the
Borrower or by reason of the bankruptcy or insolvency of the Borrower. Each
Guarantor waives any and all notice of the creation, renewal, extension or
accrual of any of the Credit Party Obligations and notice of or proof of
reliance of by any Agent or any Lender upon this Guarantee or acceptance of this
Guarantee. The Credit Party Obligations, and any of them, shall conclusively be
deemed to have been created, contracted or incurred, or renewed, extended,
amended or waived, in reliance upon this Guarantee. All dealings between the
Borrower and any of the Guarantors, on the one hand, and the Agents and the
Lenders, on the other hand, likewise shall be conclusively presumed to have been
had or consummated in reliance upon this Guarantee.
4.3. Modifications. Each Guarantor agrees that (a) all or any part of
the security now or hereafter held for the Credit Party Obligations, if any, may
be exchanged, compromised or surrendered from time to time; (b) the Lenders
shall not have any obligation to protect, perfect, secure or insure any such
security interests, liens or encumbrances now or hereafter held, if any, for the
Credit Party Obligations or the properties subject thereto; (c) the time or
place of payment of the Credit Party Obligations may be changed or extended, in
whole or in part, to a time certain or otherwise, and may be renewed or
accelerated, in whole or in part; (d) the Borrower and any other party liable
for payment under the Credit Documents may be granted indulgences generally; (e)
any of the provisions of the Notes or any of the other Credit Documents may be
modified, amended or waived; (f) any party (including any co-guarantor) liable
for the payment thereof may be granted indulgences or be released; and (g) any
deposit balance for the credit of the Borrower or any other party liable for the
payment of the Credit Party Obligations or liable upon any security therefor may
be released, in whole or in part, at, before or after the stated, extended or
accelerated maturity of the Credit Party Obligations, all without notice to or
further assent by such Guarantor, which shall remain bound thereon,
notwithstanding any such exchange, compromise, surrender, extension, renewal,
acceleration, modification, indulgence or release.
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4.4. Waiver of Rights. Each Guarantor expressly waives to the fullest
extent permitted by applicable law: (a) notice of acceptance of this Guaranty by
the Lenders and of all extensions of credit to the Borrower by the Lenders; (b)
presentment and demand for payment or performance of any of the Credit Party
Obligations; (c) protest and notice of dishonor or of default (except as
specifically required in the Credit Agreement) with respect to the Credit Party
Obligations or with respect to any security therefor; (d) notice of the Lenders
obtaining, amending, substituting for, releasing, waiving or modifying any
security interest, lien or encumbrance, if any, hereafter securing the Credit
Party Obligations, or the Lenders' subordinating, compromising, discharging or
releasing such security interests, liens or encumbrances, if any; (e) all other
notices to which such Guarantor might otherwise be entitled; and (f) demand for
payment under this Guaranty.
4.5. Reinstatement. The obligations of the Guarantors under this
Section 4 shall be automatically reinstated if and to the extent that for any
reason any payment by or on behalf of any Person in respect of the Credit Party
Obligations is rescinded or must be otherwise restored by any holder of any of
the Credit Party Obligations, whether as a result of any proceedings in
bankruptcy or reorganization or otherwise, and each Guarantor agrees that it
will indemnify the Agents and each Lender on demand for all reasonable costs and
expenses (including, without limitation, reasonable fees of counsel) incurred by
an Agent or such Lender in connection with such rescission or restoration,
including any such costs and expenses incurred in defending against any claim
alleging that such payment constituted a preference, fraudulent transfer or
similar payment under any bankruptcy, insolvency or similar law.
4.6. Remedies. The Guarantors agree that, as between the Guarantors, on
the one hand, and the Agents and the Lenders, on the other hand, the Credit
Party Obligations may be declared to be forthwith due and payable as provided in
Section 9 (and shall be deemed to have become automatically due and payable in
the circumstances provided in Section 9) notwithstanding any stay, injunction or
other prohibition preventing such declaration (or preventing such Credit Party
Obligations from becoming automatically due and payable) as against any other
Person and that, in the event of such declaration (or such Credit Party
Obligations being deemed to have become automatically due and payable), such
Credit Party Obligations (whether or not due and payable by any other Person)
shall forthwith become due and payable by the Guarantors. The
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Guarantors acknowledge and agree that their obligations hereunder are
secured in accordance with the terms of the Security Agreements and the other
Collateral Documents and that the Lenders may exercise their remedies thereunder
in accordance with the terms thereof.
4.7. Limitation of Guaranty. Notwithstanding any provision to the
contrary contained herein or in any of the other Credit Documents, to the extent
the obligations of any Guarantor shall be adjudicated to be invalid or
unenforceable for any reason (including, without limitation, because of any
applicable state or federal law relating to fraudulent conveyances or transfers)
then the obligations of such Guarantor hereunder shall be limited to the maximum
amount that is permissible under applicable law (whether federal or state and
including, without limitation, the Bankruptcy Code).
4.8. Rights of Contribution. The Guarantors hereby agree, as among
themselves, that if any Guarantor shall become an Excess Funding Guarantor (as
defined below), each other Guarantor shall, on demand of such Excess Funding
Guarantor (but subject to the next sentence hereof), pay to such Excess Funding
Guarantor an amount equal to such Guarantor's Pro Rata Share (as defined below
and determined, for this purpose, without reference to the properties, assets,
liabilities and debts of such Excess Funding Guarantor) of such Excess Payment
(as defined below). The payment obligation of any Guarantor to any Excess
Funding Guarantor under this Section 4.8 shall be subordinate and subject in
right of payment to the prior payment in full of the obligations of such
Guarantor under the other provisions of this Section 4, and such Excess Funding
Guarantor shall not exercise any right or remedy with respect to such excess
until payment and satisfaction in full of all of such obligations. For purposes
hereof, (i) "Excess Funding Guarantor" shall mean, in respect of any obligations
arising under the other provisions of this Section 4 (hereafter, the "Guaranteed
Obligations"), a Guarantor that has paid an amount in excess of its Pro Rata
Share of the Guaranteed Obligations; (ii) "Excess Payment" shall mean, in
respect of any Guaranteed Obligations, the amount paid by an Excess Funding
Guarantor in excess of its Pro Rata Share of such Guaranteed Obligations; and
(iii) "Pro Rata Share", for the purposes of this Section 4.8, shall mean, for
any Guarantor, the ratio (expressed as a percentage) of (a) the amount by which
the aggregate present fair saleable value of all of its assets and properties
exceeds the amount of all debts and liabilities of such Guarantor (including
contingent, subordinated, unmatured, and unliquidated liabilities, but excluding
the obligations of
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such Guarantor hereunder) to (b) the amount by which the aggregate
present fair saleable value of all assets and other properties of the Borrower
and all of the Guarantors exceeds the amount of all of the debts and liabilities
(including contingent, subordinated, unmatured, and unliquidated liabilities,
but excluding the obligations of the Borrower and the Guarantors hereunder) of
the Borrower and all of the Guarantors, all as of the Closing Date (if any
Guarantor becomes a party hereto subsequent to the Closing Date, then for the
purposes of this Section 4.8 such subsequent Guarantor shall be deemed to have
been a Guarantor as of the Closing Date and the information pertaining to, and
only pertaining to, such Guarantor as of the date such Guarantor became a
Guarantor shall be deemed true as of the Closing Date). Notwithstanding the
foregoing, all rights of contribution against any Guarantor shall terminate from
and after the date such Guarantor shall be relieved of its obligations pursuant
to Section 8.4.
SECTION 5.
CONDITIONS PRECEDENT
5.1. Closing Conditions. The obligation of the Lenders to enter into
this Credit Agreement and make the initial Extension of Credit is subject to
satisfaction of the following conditions:
(a) Executed Credit Documents. Receipt by the Agents of duly
executed copies of: (i) this Credit Agreement; (ii) the Notes; (iii) the
Collateral Documents and (iv) all other Credit Documents, each in form and
substance acceptable to the Lenders in their sole discretion.
(b) Corporate Documents. Receipt by the Agents of the
following:
(i) Charter Documents. Copies of the articles or
certificates of incorporation or other charter documents of
each Credit Party certified to be true and complete as of a
recent date by the appropriate Governmental Authority of the
state or other jurisdiction of its incorporation and certified
by a secretary or assistant secretary of such Credit Party to
be true and correct as of the Effective Date.
(ii) Bylaws. A copy of the bylaws of each Credit
Party certified by a secretary or assistant secretary of such
Credit Party to be true and correct as of the Effective Date.
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(iii) Resolutions. Copies of resolutions of the Board
of Directors of each Credit Party approving and adopting the
Credit Documents to which it is a party, the transactions
contemplated therein and authorizing execution and delivery
thereof, certified by a secretary or assistant secretary of
such Credit Party to be true and correct and in force and
effect as of the Effective Date.
(iv) Good Standing. Copies of (A) certificates of
good standing, existence or its equivalent with respect to
each Credit Party certified as of a recent date by the
appropriate Governmental Authorities of the state or other
jurisdiction of incorporation and each other jurisdiction in
which the failure to so qualify and be in good standing would
have a Material Adverse Effect on the business or operations
of a Credit Party in such jurisdiction and (B) to the extent
available, a certificate indicating payment of all corporate
franchise taxes certified as of a recent date by the
appropriate governmental taxing authorities.
(v) Incumbency. An incumbency certificate of each
Credit Party certified by a secretary or assistant secretary
to be true and correct as of the Effective Date.
(c) Financial Statements. Receipt by the Agents and the
Lenders of (i) the consolidated and consolidating financial statements
of the Borrower and its Subsidiaries including balance sheets and
income and cash flow statements for the fiscal quarter ended September
30, 1996 and (ii) satisfactory projections (the "Projections") for each
twelve month period through the twelve month period ending December 31,
2002.
(d) Opinion of Counsel. Receipt by the Agents of an opinion,
or opinions (which shall cover, among other things, authority,
legality, validity, binding effect, enforceability and attachment and
perfection of liens), satisfactory to the Agents, addressed to the
Agents on behalf of the Lenders and dated as of the Effective Date,
from legal counsel to the Credit Parties.
(e) Environmental Reports. To the extent not previously
received by the Collateral Agent, receipt by the Agents in form and substance
satisfactory to the Agents, of environmental assessment reports and related
documents of a recent date with respect to all Real Properties and all
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other material real property owned or leased in North America by a
Credit Party or their Subsidiaries.
(f) Personal Property Collateral. The Collateral Agent
shall have received:
(i) searches of Uniform Commercial Code ("UCC")
filings in the jurisdiction of the chief executive office of
each Credit Party and each jurisdiction where any Collateral
is located or where a filing would need to be made in order to
perfect the Lenders' security interest in the Collateral,
copies of the financing statements on file in such
jurisdictions and evidence that no Liens exist other than
Permitted Liens;
(ii) to the extent not previously received by the
Collateral Agent, duly executed UCC financing statements for
each appropriate jurisdiction as is necessary, in the
Collateral Agent's sole discretion, to perfect the Lenders'
security interest in the Collateral;
(iii) to the extent not previously received by the
Collateral Agent, searches of ownership of intellectual
property in the appropriate governmental offices and such
patent/trademark/copyright filings as requested by the
Collateral Agent in order to perfect the Collateral Agent's
security interest in the Collateral;
(iv) to the extent not previously received by the
Collateral Agent, all stock certificates evidencing the stock
pledged to the Collateral Agent pursuant to the Pledge
Agreements, together with duly executed in blank undated stock
powers attached thereto;
(v) to the extent not previously received by the
Collateral Agent, all instruments and chattel paper in the
possession of a Credit Party, as required by the Security
Agreements, together with allonges or assignments as may be
necessary or appropriate to perfect the Lenders' security
interest in the Collateral; and
(vi) to the extent not previously received by the
Collateral Agent, all Material Contracts to which a Credit
Party is a party, if any, together with assignments and third
party consents as may be necessary or appropriate to perfect
the Lenders' security interest in the Material Contracts.
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(g) Real Property Collateral. The Collateral Agent shall
have received:
(i) to the extent not previously received by the
Collateral Agent, fully executed and notarized mortgages,
deeds of trust or deeds to secure debt (each a "Mortgage" and
collectively the "Mortgages") encumbering the fee interest of
the Credit Parties in each real property asset owned by a
Credit Party set forth on Schedule 5.1(h) (each a "Mortgaged
Property" and collectively the "Mortgaged Properties"), or
amendments to such Mortgages, as applicable, together with
such UCC-1 financing statements as the Collateral Agent shall
deem appropriate with respect to each such Mortgaged Property;
(ii) to the extent not previously received by the
Collateral Agent, fully executed and notarized mortgages,
deeds of trust or deeds to secure debt (each a "Leasehold
Mortgage" and collectively the "Leasehold Mortgages")
encumbering the leasehold interest of any of the Credit
Parties (other than sales offices or showrooms) in each
leasehold estate set forth on Schedule 5.1(h) (each a
"Leasehold Mortgaged Property" and collectively the "Leasehold
Mortgaged Properties"), or amendments to such Leasehold
Mortgages, as applicable, together with such UCC-1 financing
statements (or equivalent instruments) as the Collateral Agent
shall deem appropriate with respect to such Leasehold
Mortgaged Properties and evidence that each leasehold estate
set forth on Schedule 5.1(h) is in the name of a Credit Party;
(iii) an opinion of counsel (which counsel shall be
reasonably satisfactory to the Collateral Agent) in the state
in which each Mortgaged Property and Leasehold Mortgaged
Property is located with respect to the enforceability of the
form of Mortgage or Leasehold Mortgage (or amendment thereto,
as applicable) and sufficiency of the form of UCC-1 financing
statements to be recorded or filed in such state, if
applicable, and such other matters as the Collateral Agent may
request, in form and substance satisfactory to the Collateral
Agent;
(iv) to the extent not previously received by the
Collateral Agent, in the case of each Leasehold Mortgaged
Property, (A) such estoppel letters, consents and waivers from
the landlords of such real property as
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may be reasonably required by the Collateral Agent,
which estoppel letters shall be in form and substance
reasonably satisfactory to the Collateral Agent and (B)
evidence that the applicable lease, a memorandum of lease with
respect thereto, or other evidence of such lease in form and
substance reasonably satisfactory to the Collateral Agent, has
been or will be recorded in all places to the extent necessary
or desirable, in the reasonable judgment of the Collateral
Agent, so as to enable the Leasehold Mortgage encumbering such
leasehold interest to effectively create a valid and
enforceable lien (subject only to Permitted Liens) on such
leasehold interest in favor of the Collateral Agent (or such
other Person as may be required or desired under local law)
for the benefit of Lenders;
(v) to the extent not previously received by the
Collateral Agent, ALTA or other appropriate form mortgagee
title insurance policies (the "Mortgage Policies") issued by
Chicago Title Insurance Company or other title insurers
satisfactory to the Collateral Agent (the "Title Insurance
Company"), or endorsements thereto, as applicable, in an
amount satisfactory to the Collateral Agent with respect to
each Real Property, which amount shall not exceed the fair
market value for each such Real Property, assuring the
Collateral Agent that the applicable Mortgages or Leasehold
Mortgages, as applicable, create valid and enforceable first
priority mortgage liens on the respective Real Properties,
free and clear of all defects and encumbrances except
Permitted Liens which Mortgage Policies shall be in form and
substance reasonably satisfactory to the Collateral Agent and
containing such endorsements as shall be reasonably
satisfactory to the Collateral Agent and for any other matters
that the Collateral Agent may request, and providing
affirmative insurance and such reinsurance as the Collateral
Agent may request, all of the foregoing in form and substance
reasonably satisfactory to the Agents;
(vi) to the extent not previously received by the
Collateral Agent, maps or plats of an as-built survey of the
sites of the Mortgaged Properties certified to the Collateral
Agent and the Title Insurance Company in a manner reasonably
satisfactory to them, dated a date satisfactory to the
Collateral Agent and the Title Insurance Company by an
independent professional licensed land surveyor reasonably
satisfactory to the Collateral Agent and the Title Insurance
Company, which
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maps or plats and the surveys on which they are based
shall be sufficient to delete any standard printed survey
exception contained in the applicable title policy and be made
in accordance with the Minimum Standard Detail Requirements
for Land Title Surveys jointly established and adopted by the
American Land Title Association and the American Congress on
Surveying and Mapping in 1992, and, without limiting the
generality of the foregoing, there shall be surveyed and shown
on such maps, plats or surveys the following: (A) the
locations on such sites of all the buildings, structures and
other improvements and the established building setback lines;
(B) the lines of streets abutting the sites and width thereof;
(C) all access and other easements appurtenant to the sites
necessary to use the sites; (D) all roadways, paths,
driveways, easements, encroachments and overhanging
projections and similar encumbrances affecting the site,
whether recorded, apparent from a physical inspection of the
sites or otherwise known to the surveyor; (E) any
encroachments on any adjoining property by the building
structures and improvements on the sites; and (F) if the site
is described as being on a filed map, a legend relating the
survey to said map;
(vii) to the extent not previously received by the
Collateral Agent, certification from a registered engineer or
land surveyor in a form reasonably satisfactory to the
Collateral Agent or other evidence acceptable to the
Collateral Agent that none of the improvements on the Real
Properties are located within any area designated by the
Director of the Federal Emergency Management Agency as a
"special flood hazard" area or if any improvements on the
Mortgaged Properties are located within a "special flood
hazard" area, evidence of a flood insurance policy (if such
insurance is required by applicable law) from a company and in
an amount satisfactory to the Collateral Agent for the
applicable portion of the premises, naming the Collateral
Agent, for the benefit of the Lenders, as mortgagee; and
(viii) to the extent not previously received by the
Collateral Agent, evidence satisfactory to the Collateral
Agent that each of the Mortgaged Properties, and the uses of
the Mortgaged Properties, are in compliance in all material
respects with all applicable laws, regulations and ordinances
including without limitation health and environmental
protection laws, erosion control ordinances, storm drainage
control
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laws, doing business and/or licensing laws, zoning
laws (the evidence submitted as to zoning should include the
zoning designation made for each of the Real Properties, the
permitted uses of each such Real Properties under such zoning
designation and zoning requirements as to parking, lot size,
ingress, egress and building setbacks) and laws regarding
access and facilities for disabled persons including, but not
limited to, the federal Architectural Barriers Act, the Fair
Housing Amendments Act of 1988, the Rehabilitation Act of 1973
and the Americans with Disabilities Act of 1990.
(h) Availability. After giving effect to the Loans outstanding
and Letters of Credit issued (to the extent undrawn) as of the
Effective Date (including any Loans made or Letters of Credit issued
(to the extent undrawn) on the Effective Date), there shall be at least
$30,000,000 of availability existing under the Revolving Committed
Amount.
(i) Evidence of Insurance. To the extent not previously
received by the Collateral Agent, receipt by the Agents of copies of
insurance policies or certificates of insurance of the Credit Parties
evidencing liability and casualty insurance meeting the requirements
set forth in the Credit Documents, including, but not limited to,
naming the Collateral Agent as sole loss payee on behalf of the
Lenders.
(j) Consent. Receipt by the Agents of evidence that all
governmental, shareholder and material third party consents and
approvals necessary or desirable in connection with the execution and
delivery of the Credit Documents and the consummation of the
transactions set forth therein.
(k) Material Adverse Effect. There shall not have occurred a
change since September 30, 1996 that has had or could reasonably be
expected to have a Material Adverse Effect.
(l) Litigation. There shall not exist any (i) order, decree,
judgment, ruling or injunction or (ii) any pending or threatened
action, suit, investigation or proceeding against a Credit Party or any
of their Subsidiaries that would have or would reasonably be expected
to have a Material Adverse Effect.
(m) Change in Market. The absence of any material adverse
change in the market for syndicated bank credit facilities similar
in nature to the transactions described
68
herein or a material disruption of, or a material adverse change in,
financial, banking or capital market conditions.
(n) Officer's Certificates.
(i) The Agents shall have received a certificate or
certificates executed by the chief financial officer of the
Borrower on behalf of the Borrower as of the Effective Date
stating that (A) the Borrower and each of the Borrower's
Subsidiaries are in compliance with all existing material
financial obligations, (B) all governmental, shareholder and
third party consents and approvals, if any, with respect to
the Credit Documents and the transactions contemplated thereby
have been obtained, (C) no action, suit, investigation or
proceeding is pending or threatened in any court or before any
arbitrator or governmental instrumentality that purports to
effect the Borrower, any of the Borrower's Subsidiaries or any
transaction contemplated by the Credit Documents, if such
action, suit, investigation or proceeding could have or could
be reasonably expected to have a Material Adverse Effect, (D)
the Projections (as defined in Section 5.1(c)) were prepared
in good faith and using reasonable assumptions and (E)
immediately after giving effect to this Credit Agreement, the
other Credit Documents and all the transactions contemplated
therein to occur on such date, (1) the Borrower and each of
the Borrower's Subsidiaries is Solvent, (2) no Default or
Event of Default exists, (3) all representations and
warranties contained herein and in the other Credit Documents
are true and correct in all material respects, and (4) the
Credit Parties are in compliance with each of the financial
covenants set forth in Section 7.12.
(ii) The Agents shall have received a certificate or
certificates executed by the chief financial officer of the
Parent on behalf of the Parent as of the Closing Date stating
that (A) the Parent is in compliance with all existing
financial obligations and (B) immediately after giving effect
to this Credit Agreement, the other Credit Documents and all
the transactions contemplated therein, the Parent is Solvent.
(o) Payment of Prior Credit Facility. Receipt by the
Administrative Agent of evidence that all obligations outstanding under
the Prior Credit Agreement have been paid in full or are now evidenced
by the Credit Documents.
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(p) Fees and Expenses. Payment by the Credit Parties of all
fees and expenses owed by them to the Lenders and the Agents,
including, without limitation, payment to the Agents of the fees set
forth in the Fee Letters.
(q) Other. Receipt by the Lenders of such other documents,
instruments, agreements or information as reasonably and timely
requested by any Lender, including, but not limited to, information
regarding litigation, tax, accounting, labor, insurance, pension
liabilities (actual or contingent), real estate leases, material
contracts, debt agreements, property ownership and contingent
liabilities of the Parent, the Borrower and their respective
Subsidiaries.
5.2. Conditions to All Extensions of Credit. In addition to the
conditions precedent stated elsewhere herein, the Lenders shall not be obligated
to make new Loans nor shall the Issuing Lender be required to issue or extend a
Letter of Credit unless:
(a) Notice. The Borrower shall have delivered (i) in the case
of any new Revolving Loan, a Notice of Borrowing, duly executed and
completed, by the time specified in Section 2.1 and (ii) in the case of
any Letter of Credit, the Issuing Lender shall have received an
appropriate request for issuance in accordance with the provisions of
Section 2.2;
(b) Representations and Warranties. The representations and
warranties made by the Credit Parties in any Credit Document are true
and correct in all material respects at and as if made as of such date
except to the extent they expressly relate to an earlier date;
(c) No Default. No Default or Event of Default shall exist
or be continuing either prior to or after giving effect thereto;
(d) No Material Adverse Effect. There shall not have
occurred any Material Adverse Effect; and
(e) Availability. Immediately after giving effect to the
making of a Revolving Loan (and the application of the proceeds
thereof) or to the issuance of a Letter of Credit, as the case may be,
the sum of the Revolving Loans outstanding plus LOC Obligations
outstanding shall not exceed the Revolving Commitment Amount.
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The delivery of each Notice of Borrowing and each request for a Letter of Credit
shall constitute a representation and warranty by the Borrower of the
correctness of the matters specified in subsections (b), (c), (d) and (e) above.
This Section 5.2 shall not apply to continuations or conversions of Loans made
pursuant to Section 2.4.
SECTION 6.
REPRESENTATIONS AND WARRANTIES
The Credit Parties hereby represent to the Agents and each Lender that:
6.1. Financial Condition. The financial statements delivered to the
Lenders pursuant to Section 5.1(c) and Section 7.1(a) and (b), (a) have been
prepared in accordance with GAAP (except as may otherwise be permitted under
Section 7.1(a) and (b) and (b)) present fairly (on the basis disclosed in the
footnotes to such financial statements) the consolidated and consolidating (as
applicable) financial condition, results of operations and cash flows of the
Credit Parties and their Subsidiaries as of such date and for such periods.
Since September 30, 1996, there has been no sale, transfer or other disposition
by any Credit Party or any of their Subsidiaries of any material part of the
business or property of the Credit Parties, taken as a whole, and no purchase or
other acquisition by any of them of any business or property (including any
capital stock of any other Person) material in relation to the consolidated
financial condition of the Credit Parties, taken as a whole, in each case,
which, is not (x) reflected in the most recent financial statements delivered to
the Lenders pursuant to Section 7.1 or in the notes thereto or (y) otherwise
permitted by the terms of this Credit Agreement and communicated to the
Administrative Agent.
6.2. No Material Change. (a) Since September 30, 1996, there has been
no development or event relating to or affecting a Credit Party or any of their
Subsidiaries which has had or would be reasonably expected to have a Material
Adverse Effect and (b) from and after the Closing Date, except as otherwise
permitted under this Credit Agreement, no dividends or other distributions have
been declared, paid or made upon the capital stock or other equity interest in a
Credit Party or any of its Subsidiaries nor has any of the capital stock or
other equity interest in a Credit Party been redeemed, retired, purchased or
otherwise acquired for value.
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6.3. Organization and Good Standing. The Parent, the Borrower and each
of their Subsidiaries (a) is a corporation duly incorporated, validly existing
and in good standing under the laws of the State (or other jurisdiction) of its
incorporation, (b) is duly qualified and in good standing as a foreign
corporation and authorized to do business in every jurisdiction unless the
failure to be so qualified, in good standing or authorized would have a Material
Adverse Effect and (c) has the requisite corporate power and authority to own
its properties and to carry on its business as now conducted and as proposed to
be conducted.
6.4. Due Authorization. Each Credit Party (a) has the requisite
corporate power and authority to execute, deliver and perform this Credit
Agreement and the other Credit Documents to which it is a party and to incur the
obligations herein and therein provided for and (b) is duly authorized to, and
has been authorized by all necessary corporate action, to execute, deliver and
perform this Credit Agreement and the other Credit Documents to which it is a
party.
6.5. No Conflicts. Neither the execution and delivery of the Credit
Documents, nor the consummation of the transactions contemplated therein, nor
performance of and compliance with the terms and provisions thereof by such
Credit Party will (a) violate or conflict with any provision of its articles or
certificate of incorporation or bylaws, (b) violate, contravene or materially
conflict with any Requirement of Law or any other law, regulation (including,
without limitation, Regulation U or Regulation X), order, writ, judgment,
injunction, decree or permit applicable to it, (c) violate, contravene or
conflict with contractual provisions of, or cause an event of default under, any
indenture, loan agreement, mortgage, deed of trust, contract or other agreement
or instrument to which it is a party or by which it may be bound, the violation
of which would have or might be reasonably expected to have a Material Adverse
Effect, or (d) result in or require the creation of any Lien (other than those
contemplated in or created in connection with the Credit Documents) upon or with
respect to its properties.
6.6. Consents. Except for consents, approvals and authorizations (a)
which have been obtained or (b) which are listed on Schedule 6.6, no consent,
approval, authorization or order of, or filing, registration or qualification
with, any court or Governmental Authority or third party in respect of any
Credit Party is required in connection
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with the execution, delivery or performance of this Credit Agreement or any of
the other Credit Documents by such Credit Party.
6.7. Enforceable Obligations. This Credit Agreement and the other
Credit Documents have been duly executed and delivered and constitute legal,
valid and binding obligations of each Credit Party enforceable against such
Credit Party in accordance with their respective terms, except as may be limited
by bankruptcy or insolvency laws or similar laws affecting creditors' rights
generally or by general equitable principles.
6.8. No Default. Neither the Parent, the Borrower or any of their
Subsidiaries is in default in any respect under any contract, lease, loan
agreement, indenture, mortgage, security agreement or other agreement or
obligation to which it is a party or by which any of its properties is bound
which default would have or would be reasonably expected to have a Material
Adverse Effect. No Default or Event of Default has occurred or exists except as
previously disclosed in writing to the Lenders.
6.9. Ownership. Each Credit Party and its Subsidiaries is the owner of,
and has good and marketable title to, all of its respective assets and none of
such assets is subject to any Lien other than Permitted Liens.
6.10. Indebtedness. The Credit Parties have no Indebtedness except (a)
as disclosed in the financial statements referenced in Section 6.1, (b) as set
forth on Schedule 6.10 and (c) as otherwise permitted by this Credit Agreement.
6.11. Litigation. Except as disclosed in Schedule 6.11, there are no
actions, suits or legal, equitable, arbitration or administrative proceedings,
pending or, to the knowledge of any Credit Party, threatened against the Parent,
the Borrower or any of their Subsidiaries which will have or might be reasonably
expected to have a Material Adverse Effect.
6.12. Taxes. Each of the Parent, the Borrower and their Subsidiaries
has filed, or caused to be filed, all tax returns (federal, state, local and
foreign) required to be filed and paid (a) all amounts of taxes shown thereon to
be due (including interest and penalties) and (b) all other taxes, fees,
assessments and other governmental charges (including mortgage recording taxes,
documentary stamp taxes and
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intangibles taxes) owing by it, except for such taxes (i) which are not
yet delinquent or (ii) that are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with GAAP. No Credit Party is aware as of the Closing Date of any
proposed tax assessments against it, any of its Subsidiaries or any other Credit
Party.
6.13. Compliance with Law. Each of the Parent, the Borrower and their
Subsidiaries is in compliance with all Requirements of Law and all other laws,
rules, regulations, orders and decrees (including without limitation
Environmental Laws) applicable to it, or to its properties, unless such failure
to comply would not have or would not be reasonably expected to have a Material
Adverse Effect. No Requirement of Law would be reasonably expected to cause a
Material Adverse Effect.
6.14. ERISA. Except as would not result or be reasonably
expected to result in a Material Adverse Effect:
(a) During the five-year period prior to the date on which
this representation is made or deemed made: (i) no Termination Event
has occurred, and, to the best knowledge of the Credit Parties, no
event or condition has occurred or exists as a result of which any
Termination Event could reasonably be expected to occur, with respect
to any Plan; (ii) no "accumulated funding deficiency," as such term is
defined in Section 302 of ERISA and Section 412 of the Code, whether or
not waived, has occurred with respect to any Plan; (iii) each Plan has
been maintained, operated, and funded in compliance with its own terms
and in material compliance with the provisions of ERISA, the Code, and
any other applicable federal or state laws; and (iv) no lien in favor
or the PBGC or a Plan has arisen or is reasonably likely to arise on
account of any Plan.
(b) Neither the Parent, nor any of its Subsidiaries nor any
ERISA Affiliate has incurred, or, to the best knowledge of the Credit
Parties, are reasonably expected to incur, any withdrawal liability
under ERISA to any Multiemployer Plan or Multiple Employer Plan.
Neither the Parent, any of its Subsidiaries nor any ERISA Affiliate has
received any notification that any Multiemployer Plan is in
reorganization (within the meaning of Section 4241 of ERISA), is
insolvent (within the meaning of Section 4245 of ERISA), or has been
terminated (within the meaning of Title IV of ERISA), and no
Multiemployer Plan is, to the best
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knowledge of the Credit Parties, reasonably expected to be in
reorganization, insolvent, or terminated.
(c) No prohibited transaction (within the meaning of Section
406 of ERISA or Section 4975 of the Code) or breach of fiduciary
responsibility has occurred with respect to a Plan which has subjected
or is reasonably likely to subject the Parent or any of its
Subsidiaries or any ERISA Affiliate to any liability under Sections
406, 409, 502(i), or 502(l) of ERISA or Section 4975 of the Code, or
under any agreement or other instrument pursuant to which the Parent or
any of its Subsidiaries or any ERISA Affiliate has agreed or is
required to indemnify any person against any such liability.
(d) The present value (determined using actuarial and other
assumptions which are reasonable with respect to the benefits provided
and the employees participating) of the liability of the Parent and its
Subsidiaries and each ERISA Affiliate for post-retirement welfare
benefits to be provided to their current and former employees under
Plans which are welfare benefit plans (as defined in Section 3(1) of
ERISA), net of all assets under all such Plans allocable to such
benefits, are reflected on the Financial Statements in accordance with
FASB 106.
(e) Each Plan which is a welfare plan (as defined in Section
3(1) of ERISA) to which Sections 601-609 of ERISA and Section 4980B of
the Code apply has been administered in compliance in all material
respects with such sections.
6.15. Subsidiaries. Set forth on Schedule 6.15 is a complete and
accurate list of all Subsidiaries of each Credit Party. Information on Schedule
6.15 includes jurisdiction of incorporation, the number of shares of each class
of capital stock or other equity interests outstanding, the number and
percentage of outstanding shares of each class owned (directly or indirectly) by
such Credit Party; and the number and effect, if exercised, of all outstanding
options, warrants, rights of conversion or purchase and all other similar rights
with respect thereto. The outstanding capital stock and other equity interests
of all such Subsidiaries is validly issued, fully paid and non-assessable and is
owned by each such Credit Party, directly or indirectly, free and clear of all
Liens (other than those arising under or contemplated in connection with the
Credit Documents). Other than as set forth in Schedule 6.15, neither any Credit
Party nor any Subsidiary thereof has outstanding any securities convertible into
or exchangeable for its capital stock nor does any such Person have outstanding
any rights to subscribe for or to purchase or any options for the purchase of,
or any agreements providing for the
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issuance (contingent or otherwise) of, or any calls, commitments or
claims of any character relating to its capital stock. Schedule 6.15 may be
updated from time to time by the Borrower by giving written notice thereof to
the Administrative Agent.
6.16. Use of Proceeds; Margin Stock. The proceeds of the Loans
hereunder will be used solely for the purposes specified in Section 7.10. None
of the proceeds of the Loans will be used for the purpose of purchasing or
carrying any "margin stock" as defined in Regulation U, Regulation X or
Regulation G, or for the purpose of reducing or retiring any Indebtedness which
was originally incurred to purchase or carry "margin stock" or any "margin
security" or for any other purpose which might constitute this transaction a
"purpose credit" within the meaning of Regulation U, Regulation X, Regulation G
or Regulation T. None of the Credit Parties owns any "margin stock".
6.17. Government Regulation. No Credit Party is subject to regulation
under the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Investment Company Act of 1940 or the Interstate Commerce Act, each as amended.
In addition, no Credit Party is (a) an "investment company" registered or
required to be registered under the Investment Company Act of 1940, as amended,
or controlled by such a company, or (b) a "holding company," or a "Subsidiary
company" of a "holding company," or an "affiliate" of a "holding company" or of
a "Subsidiary" or a "holding company," within the meaning of the Public Utility
Holding Company Act of 1935, as amended. No director, executive officer or
principal shareholder of the Parent, the Borrower or any of its Subsidiaries is
a director, executive officer or principal shareholder of any Lender. For the
purposes hereof the terms "director", "executive officer" and "principal
shareholder" (when used with reference to any Lender) have the respective
meanings assigned thereto in Regulation O issued by the Board of Governors of
the Federal Reserve System.
6.18. Environmental Matters. (a) Except as set forth on Schedule 6.18
or except as would not have or be reasonably expected to have a Material Adverse
Effect:
(i) Each of the Real Properties and all operations at
the Real Properties are in compliance with all applicable
Environmental Laws, and there is no
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violation of any Environmental Law with respect to
the Real Properties or the businesses operated by the Parent,
the Borrower or any of their Subsidiaries (the "Businesses"),
and there are no conditions relating to the Businesses or Real
Properties that would be reasonably expected to give rise to
liability under any applicable Environmental Laws.
(ii) Neither the Parent, the Borrower nor any of
their Subsidiaries has received any written or oral notice of,
or inquiry from any Governmental Authority regarding, any
violation, alleged violation, non-compliance, liability or
potential liability regarding Hazardous Materials or
compliance with Environmental Laws with regard to any of the
Real Properties or the Businesses, nor does the Parent, the
Borrower or any of their Subsidiaries have knowledge or reason
to believe that any such notice is being threatened.
(iii) Hazardous Materials have not been transported
or disposed of from the Real Properties, or generated,
treated, stored or disposed of at, on or under any of the Real
Properties or any other location, in each case by, or on
behalf or with the permission of, the Parent, the Borrower or
any of their Subsidiaries in a manner that would reasonably be
expected to give rise to liability under any applicable
Environmental Law.
(iv) No judicial proceeding or governmental or
administrative action is pending or, to the knowledge of the
Parent, the Borrower or any of their Subsidiaries, threatened,
under any Environmental Law to which the Parent, the Borrower
or any of their Subsidiaries is or will be named as a party,
nor are there any consent decrees or other decrees, consent
orders, administrative orders or other orders, or other
administrative or judicial requirements outstanding under any
Environmental Law with respect to the Parent, the Borrower or
any of their Subsidiaries, the Real Properties or the
Businesses, in any amount reportable under the federal
Comprehensive Environmental Response, Compensation and
Liability Act or any analogous state law, except releases in
compliance with any Environmental Laws.
(v) There has been no release or threat of release of
Hazardous Materials at or from the Real Properties, or arising
from or related to the operations (including, without
limitation, disposal) of
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the Parent, the Borrower or any of their Subsidiaries
in connection with the Real Properties or otherwise in
connection with the Businesses.
(b) The Borrower has adopted procedures that are designed to
(i) ensure that each Credit Party and its Subsidiaries, any of their
operations and each of the properties owned or leased by each Credit
Party and its Subsidiaries remains in compliance with applicable
Environmental Laws and (ii) minimize any liabilities or potential
liabilities that each Credit Party and their Subsidiaries, any of their
operations and each of the properties owned or leased by each Credit
Party and its Subsidiaries may have under applicable Environmental
Laws.
6.19. Intellectual Property. The Parent, the Borrower and each of their
Subsidiaries owns, or has the legal right to use, all trademarks, tradenames,
copyrights, technology, know-how and processes (the "Intellectual Property")
necessary for each of them to conduct its business as currently conducted except
for those the failure to own or have such legal right to use would not have or
be reasonably expected to have a Material Adverse Effect. Set forth on Schedule
6.19 is a list of all Intellectual Property owned by each Credit Party or that
any Credit Party has the right to use. Except as provided on Schedule 6.19, no
claim has been asserted and is pending by any Person challenging or questioning
the use of any such Intellectual Property or the validity or effectiveness of
any such Intellectual Property, nor does any Credit Party know of any such
claim, and to the Credit Parties' knowledge the use of such Intellectual
Property by the Parent, the Borrower or any of their Subsidiaries does not
infringe on the rights of any Person, except for such claims and infringements
that in the aggregate, would not have or be reasonably expected to have a
Material Adverse Effect. Schedule 6.19 may be updated from time to time by the
Borrower by giving written notice thereof to the Administrative Agent.
6.20. Solvency. Each Credit Party is and, after consummation of the
transactions contemplated by this Credit Agreement, will be Solvent.
6.21. Investments. All Investments of each Credit Party are either
Permitted Investments or otherwise permitted by the terms of this Credit
Agreement.
6.22. No Financing of Corporate Takeovers. No proceeds of
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the Loans hereunder have been or will be used to acquire, directly or
indirectly, any security in any transaction which is subject to Sections 13 or
14 of the Securities Exchange Act of 1934, as amended (including, without
limitation, Sections 13(d) and 14(d) thereof) or to refinance any Indebtedness
used to acquire any such securities.
6.23. Location of Collateral. Set forth on Schedule 6.23(a) is a list
of all Real Properties with street address, county and state where located. Set
forth on Schedule 6.23(b) is a list of all locations where any personal property
of a Credit Party is located, including county and state where located. Set
forth on Schedule 6.23(c) is the chief executive office and principal place of
business of each Credit Party. Schedule 6.23(a), 6.23(b) and 6.23(c) may be
updated from time to time by the Borrower by giving written notice thereof to
the Administrative Agent.
6.24. Disclosure. Neither this Agreement nor any financial statements
delivered to the Lenders nor any other document, certificate or statement
furnished to the Lenders by or on behalf of any Credit Party in connection with
the transactions contemplated hereby contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the statements
contained therein or herein not misleading.
6.25. Licenses, etc. The Credit Parties have obtained and hold in full
force and effect, all franchises, licenses, permits, certificates,
authorizations, qualifications, accreditations, easements, rights of way and
other rights, consents and approvals which are necessary for the operation of
their respective businesses as presently conducted except where the failure to
do so would not have or would not be reasonably expected to have a Material
Adverse Effect.
6.26. No Burdensome Restrictions. No Credit Party is a party to any
agreement or instrument or subject to any other obligation or any charter or
corporate restriction or any provision of any applicable law, rule or regulation
which, individually or in the aggregate, would have or be reasonably expected to
have a Material Adverse Effect.
6.27. Brokers' Fees. Except for those paid on or before the Effective
Date, no Credit Party has any obligation to any Person in respect of any
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finder's, broker's, investment banking or other similar fee in connection with
any of the transactions contemplated under the Credit Documents.
6.28. Labor Matters. Except as disclosed on Schedule 6.28, there are no
collective bargaining agreements or Multiemployer Plans covering the employees
of a Credit Party as of the Effective Date and none of such Persons has suffered
any strikes, walkouts, work stoppages or other material labor difficulty within
the last five years.
SECTION 7.
AFFIRMATIVE COVENANTS
Each Credit Party hereby covenants and agrees that so long as this
Credit Agreement is in effect and until the Loans and LOC Obligations, together
with interest and fees hereunder, have been paid in full and the Commitments and
Letters of Credit hereunder shall have terminated:
7.1. Information Covenants. The Borrower will furnish, or cause to be
furnished, to the Administrative Agent and each of the Lenders:
(a) Annual Financial Statements. As soon as available, and in
any event within 90 days after the close of each fiscal year of the
Borrower, a consolidated and consolidating balance sheet and income
statement of the Parent and its Subsidiaries, as of the end of such
fiscal year, together with related consolidated and consolidating
statements of operations and retained earnings and of cash flows for
such fiscal year, setting forth in comparative form consolidated
figures for the preceding fiscal year, all such financial information
described above to be in reasonable form and detail and audited (with
respect to consolidated financial statements only) by independent
certified public accountants of recognized national standing reasonably
acceptable to the Agents and whose opinion shall be to the effect that
such financial statements have been prepared in accordance with GAAP
(except for changes with which such accountants concur) and shall not
be limited as to the scope of the audit or qualified in any manner.
(b) Quarterly Financial Statements. As soon as
available, and in any event within 45 days after the close of each
fiscal quarter of the Borrower (other than the
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fourth fiscal quarter) a consolidated and consolidating
balance sheet and income statement of the Parent and its Subsidiaries,
as of the end of such fiscal quarter, together with related
consolidated and consolidating statements of operations and retained
earnings and of cash flows for such fiscal quarter in each case setting
forth in comparative form (with appropriate adjustments for fiscal year
1995 including the adjustments as shown on Schedule 7.1(b))
consolidated and consolidating figures for the corresponding period of
the preceding fiscal year, all such financial information described
above to be in reasonable form and detail and reasonably acceptable to
the Agent, and accompanied by a certificate of the chief financial
officer of the Borrower to the effect that such quarterly financial
statements fairly present in all material respects the financial
condition of the Parent, the Borrower and their Subsidiaries and have
been prepared in accordance with GAAP, subject to changes resulting
from audit and normal year-end audit adjustments.
(c) Officer's Certificate. At the time of delivery of the
financial statements provided for in Sections 7.1(a) and 7.1(b) above,
a certificate of the chief financial officer of the Borrower
substantially in the form of Exhibit 7.1(c), (i) demonstrating
compliance with the financial covenants contained in Section 7.12 by
calculation thereof as of the end of each such fiscal period, (ii)
stating whether any dividends were paid or redemptions made during the
most recent fiscal quarter and if any dividends were paid or
redemptions made showing compliance with the terms of Section 8.7, as
applicable (including calculations as necessary), (iii) stating whether
any principal payments, redemptions or deposits were made with respect
to Subordinated Debt during the most recent fiscal quarter and if any
principal payments, redemptions or deposits were made with respect to
Subordinated Debt showing compliance with the terms of Section 8.11, as
applicable (including calculations as necessary) and (iv) stating that
no Default or Event of Default exists, or if any Default or Event of
Default does exist, specifying the nature and extent thereof and what
action the Borrower proposes to take with respect thereto.
(d) Annual Business Plan and Budgets. Within 30 days after the
end of each fiscal year of the Borrower, beginning with the fiscal year
ending December 31, 1996, an annual business plan and budget of the
Parent, the Borrower and their Subsidiaries on a consolidated basis
containing, among other things, pro forma financial statements for the
next fiscal year.
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(e) Compliance With Certain Provisions of the Credit
Agreement. Within 90 days after the end of each fiscal year of the
Borrower, the Borrower shall deliver a certificate, containing
information regarding (i) the calculation of Excess Cash Flow, (ii) the
Net Cash Proceeds of any Asset Dispositions that were made during the
prior fiscal year and (iii) the Net Cash Proceeds received pursuant to
Public Equity Offerings during the prior fiscal year.
(f) Accountant's Certificate. Within the period for delivery
of the annual financial statements provided in Section 7.1(a), a
certificate of the accountants conducting the annual audit stating that
they have reviewed this Credit Agreement and stating further whether,
in the course of their audit, they have become aware of any Default or
Event of Default and, if any such Default or Event of Default exists,
specifying the nature and extent thereof; provided that no such
certificate shall be required if the Borrower has used its best efforts
to obtain same and such accountants are unwilling to provide such a
certificate and other independent certified public accountants of
recognized national standing are unwilling to provide such a
certificate.
(g) Auditor's Reports. Promptly upon receipt thereof, a copy
of any "management letter" submitted by independent accountants to the
Parent, the Borrower or any of its Subsidiaries in connection with any
annual, interim or special audit of the books of the Parent, the
Borrower or any of its Subsidiaries.
(h) Reports. Promptly upon transmission or receipt thereof,
(a) copies of any filings and registrations with, and reports to or
from, the Securities and Exchange Commission, or any successor agency,
and copies of all financial statements, proxy statements, notices and
reports as the Parent, the Borrower or any of their Subsidiaries shall
send to its shareholders generally or to a holder of the Subordinated
Debt in its capacity as such a holder and (b) upon the written request
of an Agent, all reports and written information to and from the United
States Environmental Protection Agency, or any state or local agency
responsible for environmental matters, the United States Occupational
Health and Safety Administration, or any state or local agency
responsible for health and safety matters, or any successor agencies or
authorities concerning environmental, health or safety matters.
(i) Notices. Upon a Credit Party obtaining knowledge
thereof, such Credit Party will give written notice to the
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Administrative Agent immediately of (a) the occurrence of an
event or condition consisting of a Default or Event of Default,
specifying the nature and existence thereof and what action the
Borrower proposes to take with respect thereto, and (b) the occurrence
of any of the following with respect to a the Parent, the Borrower or
any of their Subsidiaries (i) the pendency or commencement of any
litigation, arbitral or governmental proceeding against the Parent, the
Borrower or any of their Subsidiaries which if adversely determined
would have or would be reasonably expected to have a Material Adverse
Effect, or (ii) the institution of any proceedings against the Parent,
the Borrower or any of their Subsidiaries with respect to, or the
receipt of notice by such Person of potential liability or
responsibility for violation, or alleged violation of any federal,
state or local law, rule or regulation, including but not limited to,
Environmental Laws, the violation of which would have or would be
reasonably expected to have a Material Adverse Effect.
(j) ERISA. Upon any of the Credit Parties or any ERISA
Affiliate obtaining knowledge thereof, Borrower will give written
notice to the Administrative Agent and each of the Lenders promptly
(and in any event within five Business Days) of: (i) any event or
condition, including, but not limited to, any Reportable Event, that
constitutes, or might reasonably lead to, a Termination Event; (ii)
with respect to any Multiemployer Plan, the receipt of notice as
prescribed in ERISA or otherwise of any withdrawal liability assessed
against the Borrowers or any of their ERISA Affiliates, or of a
determination that any Multiemployer Plan is in reorganization or
insolvent (both within the meaning of Title IV of ERISA); (iii) the
failure to make full payment on or before the due date (including
extensions) thereof of all amounts which the Parent, the Borrower or
any of its Subsidiaries or ERISA Affiliates is required to contribute
to each Plan pursuant to its terms and as required to meet the minimum
funding standard set forth in ERISA and the Code with respect thereto;
or (iv) any change in the funding status of any Plan that could have a
Material Adverse Effect; together, with a description of any such event
or condition or a copy of any such notice and a statement by the
principal financial officer of the Borrower briefly setting forth the
details regarding such event, condition, or notice, and the action, if
any, which has been or is being taken or is proposed to be taken by the
Credit Parties with respect thereto. Promptly upon request, the
Borrower shall furnish the Administrative Agent and each of the Lenders
with such additional information concerning any Plan as may be
reasonably requested, including, but not
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limited to, copies of each annual report/return (Form 5500
series), as well as all schedules and attachments thereto required to
be filed with the Department of Labor and/or the Internal Revenue
Service pursuant to ERISA and the Code, respectively, for each "plan
year" (within the meaning of Section 3(39) of ERISA).
(k) Environmental.
(i) Upon the written request of an Agent, (A) based
upon the reasonable belief that there has been a violation of
Environmental Law or a release of Hazardous Substances at a
Real Property which is reasonably likely to have a Material
Adverse Effect or (B) at any time during the existence and
continuance of an Event of Default, the Borrower will furnish
or cause to be furnished to the Administrative Agent, at the
Borrower's expense, a report of an environmental assessment of
reasonable scope, form and depth, (including, where
appropriate, if there is no Event of Default, (and where such
Agent has a reasonable belief that there has been a violation
of Environmental Law or a release of Hazardous Substance at a
Real Property which is reasonably likely to have a Material
Adverse Effect), invasive soil or groundwater sampling) by a
consultant reasonably acceptable to the Agents as to the
nature and extent of such release on any Real Property and as
to the compliance by the Credit Parties with Environmental
Laws at such Real Property. If the Borrower fails to deliver
such an environmental report within seventy-five (75) days
after receipt of such written request then the Agents may
arrange for same, and the Borrower hereby grants to the Agents
and their representatives upon reasonable notice and upon
reasonable terms and conditions access to the Real Properties
and a license of a scope reasonably necessary to undertake
such an assessment (including, where appropriate, invasive
soil or groundwater sampling). The reasonable cost of any
assessment arranged for by the Agents pursuant to this
provision will be payable by the Borrower on demand and added
to the obligations secured by the Collateral Documents.
(ii) The Parent, the Borrower and each of their
Subsidiaries will conduct and complete all investigations,
studies, sampling, and testing and all remedial, removal, and
other actions necessary to address all Hazardous Materials on,
from, or affecting any real property owned or leased by the
Parent, the Borrower or their Subsidiaries to the extent
necessary
84
to be in compliance with all Environmental Laws and
all other applicable federal, state, and local laws,
regulations, rules and policies and with the orders and
directives of all Governmental Authorities exercising
jurisdiction over such real property to the extent any failure
would have or be reasonably expected to have a Material
Adverse Effect.
(l) Other Information. With reasonable promptness upon any
such request, such other information regarding the business, properties
or financial condition of the Credit Parties and their Subsidiaries as
an Agent may reasonably request.
7.2. Preservation of Existence and Franchises. Each of the Credit
Parties will, and will cause each of its Subsidiaries to, do all things
necessary to preserve and keep in full force and effect its existence, rights,
franchises and authority except as permitted by Section 8.4 or except (with
respect to rights, franchises and authority only) where the failure to do so
would not have or be reasonably expected to have a Material Adverse Effect.
7.3. Books and Records. Each of the Credit Parties will, and will cause
each of its Subsidiaries to, keep complete and accurate books and records of its
transactions in accordance with good accounting practices on the basis of GAAP
(including the establishment and maintenance of appropriate reserves).
7.4. Compliance with Law. Each of the Credit Parties will, and will
cause each of its Subsidiaries to, comply with all laws, rules, regulations and
orders, and all applicable restrictions imposed by all Governmental Authorities,
applicable to it and its property (including, without limitation, Environmental
Laws) if noncompliance with any such law, rule, regulation, order or restriction
would have or reasonably be expected to have a Material Adverse Effect.
7.5. Payment of Taxes and Other Indebtedness. Each of the Credit
Parties will, and will cause its Subsidiaries to, pay, settle or discharge (a)
all taxes, assessments and governmental charges or levies imposed upon it, or
upon its income or profits, or upon any of its properties, before they shall
become delinquent, (b) all lawful claims (including claims for labor, materials
and supplies) which, if unpaid, might give rise to a
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Lien upon any of its properties, and (c) except as prohibited hereunder, all of
its other Indebtedness as it shall become due; provided, however, that a Credit
Party or its Subsidiary shall not be required to pay any such tax, assessment,
charge, levy, claim or Indebtedness which (x) is being contested in good faith
by appropriate proceedings and as to which adequate reserves therefor have been
established in accordance with GAAP, unless the failure to make any such payment
(i) would give rise to an immediate right to foreclose on a Lien securing such
amounts or (ii) would have a Material Adverse Effect or (y) if the aggregate
amount of such unpaid tax, assessment, charge, levy, claim or Indebtedness does
not exceed $5,000,000 (taking into account applicable insurance or indemnities
to the extent the provider of such insurance or indemnity has the financial
ability to support its obligations with respect thereto and is not disputing
same).
7.6. Insurance. Each of the Credit Parties will, and will cause each of
its Subsidiaries to, at all times maintain in full force and effect insurance
(including worker's compensation insurance, liability insurance, casualty
insurance and business interruption insurance) in such amounts, covering such
risks and liabilities and with such deductibles or self-insurance retentions as
are in accordance with normal industry practice. All liability policies shall
have each Lender as an additional insured and all casualty policies shall have
the Administrative Agent, on behalf of the Lenders, as loss payee.
In the event there occurs any material loss, damage to or destruction of the
Collateral of any Credit Party or any part thereof, such Credit Party shall
promptly give written notice thereof to the Administrative Agent generally
describing the nature and extent of such damage or destruction. Subsequent to
any loss, damage to or destruction of the Collateral of any Credit Party or any
part thereof, such Credit Party, whether or not the insurance proceeds, if any,
received on account of such damage or destruction shall be sufficient for that
purpose, at such Credit Party's cost and expense, will promptly repair or
replace the Collateral of such Credit Party so lost, damaged or destroyed;
provided, however, that such Credit Party need not repair or replace the
Collateral of such Credit Party so lost, damaged or destroyed to the extent the
failure to make such repair or replacement (a) is desirable to the proper
conduct of the business of such Credit Party in the ordinary course and
otherwise is in the best interest of such Credit Party and (b) would not
materially impair the rights and benefits of the Agents or the Lenders under
this Credit Agreement or any other Credit Document. In the event a Credit Party
shall receive any insurance proceeds, as a result of any loss, damage or
destruction, in a net amount in excess of $500, 000, such Credit
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Party will immediately pay over such proceeds to the Administrative Agent as
cash collateral for the Credit Party Obligations. The Administrative Agent
agrees to release such insurance proceeds to such Credit Party for replacement
or restoration of the portion of the Collateral of such Credit Party lost,
damaged or destroyed if (A) within 120 days from the date the Administrative
Agent receives such insurance proceeds, the Administrative Agent has received
written application for such release from such Credit Party together with
evidence reasonably satisfactory to it that the Collateral lost, damaged or
destroyed has been or will be replaced or restored to its condition (or by
Collateral having a value at least equal to the condition of the asset subject
to the loss, damage or destruction) immediately prior to the loss, destruction
or other event giving rise to the payment of such insurance proceeds and (B) on
the date of such release no Default or Event of Default exists. If the
conditions in the preceding sentence are not met, the Administrative Agent
shall, on the first Business Day subsequent to the date 120 days after it
received such insurance proceeds, apply such insurance proceeds as a mandatory
prepayment of the Credit Party Obligations for application in accordance with
the terms of Section 3.3 (b) (ii) and Section 3.3 (c). All insurance proceeds
shall be subject to the security interest of the Lenders under the Collateral
Documents.
The present insurance coverage of the Parent, the Borrower and their
Subsidiaries is outlined as to carrier, policy number, expiration date, type and
amount on Schedule 7.6, as Schedule 7.6 may be amended from time to time by
written notice to the Administrative Agent.
7.7. Maintenance of Property. Each of the Credit Parties will, and will
cause its Subsidiaries to, maintain and preserve its properties and equipment in
good repair, working order and condition, normal wear and tear excepted, and
will make, or cause to be made, in such properties and equipment from time to
time all repairs, renewals, replacements, extensions, additions, betterments and
improvements thereto as may be needed or proper, to the extent and in the manner
customary for companies in similar businesses.
7.8. Performance of Obligations. Each of the Credit Parties will, and
will cause its Subsidiaries to, perform in all respects all of its obligations
under the terms of all agreements, indentures, mortgages, security agreements or
other debt instruments to which it is a party or by which it is bound unless the
failure to do so
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will not have or be reasonably expected to have a material adverse
effect on the ability of a Credit Party to perform its respective obligations
under this Credit Agreement or the other Credit Documents.
7.9. Collateral. If, subsequent to the Closing Date, a Credit Party
shall (a) acquire or lease any real property or (b) acquire any intellectual
property, securities, instruments, chattel paper or other personal property
required to be delivered to the Collateral Agent as Collateral hereunder or
under any of the Collateral Documents, the Borrower shall promptly (and in any
event within three (3) Business Days) after any senior executive officer of the
Borrower acquires knowledge of same notify the Collateral Agent of same. Each
Credit Party shall take such action (including, but not limited to, the actions
set forth in Sections 5.1(f) and (g)), as requested by the Collateral Agent and
at its own expense, to ensure that the Lenders have a first priority perfected
Lien in all owned real property (and in such leased real property (other than
leased real property for sales offices or showrooms) as reasonably requested by
the Collateral Agent or the Required Lenders) and all personal property of the
Credit Parties (whether now owned or hereafter acquired), subject only to
Permitted Liens; provided, however, that nothing in this Section 7.9 shall
require any Credit Party to take any action which would require the creation of
any Lien that would result in a breach of any agreement creating or evidencing
such Collateral so long as such agreement was not entered into with the intent
of avoiding the requirements of this Section 7.9 or 8.14. Each Credit Party
shall adhere to the covenants regarding the location of personal property as set
forth in the Security Agreements.
7.10. Use of Proceeds. The Credit Parties will use the proceeds of the
Loans solely (a) to refinance all amounts outstanding under the Prior Credit
Agreement, (b) to provide working capital and (c) for general corporate
purposes. The Credit Parties will use the Letters of Credit solely for the
purposes set forth in Section 2.2(a).
7.11. Audits/Inspections. Upon reasonable notice and during normal
business hours (but absent the existence of an Event of Default or other
reasonable cause, not more than twice during any fiscal year), each Credit Party
will, and will cause its Subsidiaries to, permit, subject to the provisions of
Section 11.17, representatives appointed by an Agent, including, without
limitation, independent accountants, agents, attorneys and appraisers to visit
and inspect such Credit Party's (or its
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Subsidiary's) property, including its books and records, its accounts
receivable and inventory, its facilities and its other business assets, and to
make photocopies or photographs thereof and to write down and record any
information such representative obtains and shall permit an Agent or its
representatives to investigate and verify the accuracy of information provided
to the Lenders and to discuss all such matters with the officers, employees and
representatives of the Credit Parties and their Subsidiaries. The Credit Parties
agree that the Collateral Agent, and its representatives, may conduct an annual
audit of the Collateral, at the expense of the Borrower; provided that if an
audit is performed at a time when no Event of Default shall exist, the Borrower
shall not be required to pay more than $15,000 of expenses in connection with
such audit.
7.12. Financial Covenants.
(a) Interest Coverage Ratio. The Interest Coverage
Ratio, as of the end of each fiscal quarter, shall be greater
than or equal to:
(i) From the Effective Date to and including
December 31, 1997, 2.5 to 1.0; and
(ii) From January 1, 1998 and thereafter, 2.75
to 1.0.
(b) Leverage Ratio. The Leverage Ratio, as of the end of
each fiscal quarter, shall be less than or equal to:
(i) From the Effective Date to and including
June 30, 1997, 4.75 to 1.0;
(ii) From July 1, 1997 to and including December
31, 1997, 4.50 to 1.0;
(iii) From January 1, 1998 to and including
December 31, 1998, 4.00 to 1.0; and
(iv) From January 1, 1999 and thereafter, 3.50
to 1.0.
Notwithstanding the above, if a Release of Collateral Event occurs, and the
Borrower exercises its option to release Collateral pursuant to Section 11.18,
then, from that date forward, the Leverage Ratio, as of the end of each fiscal
quarter thereafter, shall be less than or equal to 3.0 to 1.0.
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7.13. Additional Credit Parties. At the time any Person becomes a
Subsidiary of a Credit Party, the Borrower shall so notify the Administrative
Agent and promptly thereafter (but in any event within 30 days after the date
thereof) shall (a) cause such Person to, if it is a Domestic Subsidiary, execute
a Joinder Agreement in substantially the same form as Exhibit 7.13, (b) unless a
Release of Collateral Event has occurred and the Borrower has exercised its
rights under Section 11.18, (i) cause all of the capital stock of such Person
(if such Person is a Domestic Subsidiary) or 65% of the capital stock of such
Person (if such Person is a Foreign Subsidiary owned by the Borrower or a
Domestic Subsidiary) to be delivered to the Collateral Agent (together with
undated stock powers signed in blank) and pledged to the Collateral Agent
pursuant to an appropriate pledge agreement in substantially the form of the
Pledge Agreements and otherwise in a form acceptable to the Collateral Agent,
(ii) if such Person is a Domestic Subsidiary, pledge all of its assets to the
Lenders pursuant to a security agreement in substantially the form of the
Security Agreements and otherwise in a form acceptable to the Collateral Agent,
(iii) if such Person is a Domestic Subsidiary and has any Subsidiaries, (A)
deliver all of the capital stock of such Domestic Subsidiaries and 65% of the
capital stock of such direct Foreign Subsidiaries (together with undated stock
powers signed in blank) to the Collateral Agent and (B) execute a pledge
agreement in substantially the form of the Pledge Agreements and otherwise in a
form acceptable to the Collateral Agent, (iv) if such Person is a Domestic
Subsidiary and owns or leases any real property in the United States of America,
execute any and all necessary mortgages, deeds of trust, deeds to secure debt,
leasehold mortgages, collateral assignments of leaseholds or other appropriate
real estate collateral documentation in a form substantially similar to the
Mortgages or the Leasehold Mortgages, as the case may be, with appropriate
covenants as necessary (provided that if a leased property is solely for use as
a sales office or showroom it shall not be required to be mortgaged) and (v)
deliver such other documentation as the Administrative Agent or Collateral Agent
may reasonably request in connection with the foregoing (to the extent any such
documentation was required to be delivered to an Agent pursuant to Section 5.1
on or before the Effective Date), including, without limitation, appropriate
UCC-1 financing statements, real estate title insurance policies, environmental
reports and landlord waivers, and (c) cause such Person to deliver certified
resolutions and other organizational and authorizing documents of such Person
and favorable opinions of counsel to such Person (which shall cover, among other
things, the legality, validity, binding effect and enforceability of the
documentation referred to above); it being understood that all of the
documentation, agreements, instruments, certificates and
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opinions to be delivered pursuant to (a), (b) and (c) above shall be in
form, content and scope reasonably satisfactory to the Agents. Notwithstanding
anything in this Section 7.13 to the contrary, this Section 7.13 shall not
require any Credit Party to take any action which would (x) violate any
Requirement of Law or (y) require the creation of any Lien on any asset subject
to a Permitted Lien that would result in a breach of any agreement creating or
evidencing such asset so long as such agreement was not entered into with the
intent of avoiding the requirements of this Section 7.13.
7.14. Interest Rate Protection Agreements. The Borrower shall maintain
interest rate protection agreements, in form and substance reasonably acceptable
to the Agents (it being hereby acknowledged that the agreements in effect as of
the Closing Date are acceptable to the Agents), protecting against fluctuations
in interest rates and in a notional amount of at least forty percent (40%) of
the then outstanding principal amount owing under the Credit Documents.
SECTION 8.
NEGATIVE COVENANTS
Each Credit Party hereby covenants and agrees that so long as this
Credit Agreement is in effect and until the Loans and LOC Obligations, together
with interest and fees hereunder, have been paid in full and the Commitments and
Letters of Credit hereunder shall have terminated:
8.1. Indebtedness. No Credit Party will, nor will it permit any
of its Subsidiaries to, contract, create, incur, assume or permit to exist
any Indebtedness, except:
(a) Indebtedness arising under this Credit Agreement and
the other Credit Documents;
(b) the Subordinated Debt;
(c) Indebtedness existing as of the Closing Date (other than
the Subordinated Debt) as referenced in Section 6.10 (and renewals,
refinancings or extensions in a principal amount not in excess of that
outstanding as of the date of such renewal, refinancing or extension);
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(d) Indebtedness in respect of current accounts payable and
accrued expenses incurred in the ordinary course of business including,
to the extent not current, accounts payable and accrued expenses that
are subject to bona fide dispute;
(e) Indebtedness owing (i) by one Credit Party to another
Credit Party or (ii) by a Foreign Subsidiary other than a Canadian
Subsidiary to another Foreign Subsidiary other than a Canadian
Subsidiary or (iii) by a Canadian Subsidiary to another Canadian
Subsidiary;
(f) purchase money Indebtedness (including Capital Leases) or
TROLS incurred by the Borrower or any of its Subsidiaries to finance
the purchase of fixed assets; provided that (i) the total of all such
Indebtedness for all such Persons taken together shall not exceed an
aggregate principal amount of $5,000,000 at any one time outstanding
(including any such Indebtedness referred to in subsection (c) above);
(ii) such Indebtedness when incurred shall not exceed the purchase
price of the asset(s) financed; and (iii) no such Indebtedness shall be
refinanced for a principal amount in excess of the principal balance
outstanding thereon at the time of such refinancing;
(g) (i) obligations of the Credit Parties evidenced by the
interest rate protection agreements referred to in Section 7.14 and
(ii) such other interest rate protection agreements as a Credit Party
in its prudent judgment may enter into so long as such other interest
rate protection agreements were not entered into for investment or
speculative reasons;
(h) Indebtedness incurred by Foreign Subsidiaries (and any
guaranty thereof by a Credit Party so long as such guaranty is
permitted by Section 8.6) not to exceed $10,000,000, in the aggregate,
at any one time outstanding (including any such Indebtedness referred
to in subsection (c) above);
(i) Indebtedness in respect of performance, surety or
appeal bonds in the ordinary course of business;
(j) Indebtedness in respect of Currency Agreements;
(k) Indebtedness arising from agreements providing for
indemnification, adjustment of purchase price or similar obligations
(or from guarantees or letters of credit, surety bonds or performance
bonds securing any obligations of the Borrower or any of its
Subsidiaries pursuant to such
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agreements), in any case incurred in connection with the
disposition of any business, assets or Subsidiary of the Borrower, to
the extent otherwise permitted under this Credit Agreement, (other than
guarantees of Indebtedness incurred by any Person acquiring all or any
portion of such business, assets or Subsidiary for the purpose of
financing such acquisition), in a principal amount not to exceed the
gross proceeds actually received by the Borrower or any of its
Subsidiaries in connection with such disposition;
(l) Shareholder Subordinated Indebtedness; provided that the
aggregate principal amount of such Shareholder Subordinated
Indebtedness shall not exceed, at any one time outstanding,
$50,000,000;
(m) Indebtedness assumed in connection with a Permitted
Acquisition so long as (i) such Indebtedness is not incurred in
contemplation of such Permitted Acquisition, (ii) neither the Borrower
nor any Subsidiary of the Borrower (other than the Person being
acquired or a Subsidiary of the Person being acquired) is liable for or
assumes such Indebtedness and such Indebtedness is, and continues after
such Permitted Acquisition to be, non-recourse to the Borrower and all
of its Subsidiaries (other than the Person being acquired or a
Subsidiary of the Person being acquired) and (iii) the amount of
Indebtedness assumed pursuant to Permitted Acquisitions may not exceed
$30,000,000, in the aggregate, during the term of this Credit
Agreement; and
(n) Indebtedness of the Borrower and its Subsidiaries (in
addition to Indebtedness otherwise permitted by any other clause of
this Section 8.1) in an aggregate principal amount at any time
outstanding not to exceed $10,000,000.
8.2. Liens. No Credit Party will, nor will it permit its Subsidiaries
to contract, create, incur, assume or permit to exist any Lien with respect to
any of its property or assets of any kind (whether real or personal, tangible or
intangible), whether now owned or after acquired, except for Permitted Liens.
8.3. Nature of Business. No Credit Party will, nor will it permit its
Subsidiaries to, alter the character of its business from that, or substantially
similar to that, conducted as of the Closing Date or engage in any business
other than the business conducted as of the Closing Date with reasonable
extensions and expansions of such business.
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8.4. Consolidation and Merger. No Credit Party will, nor will it permit
its Subsidiaries to, enter into any transaction of merger or consolidation or
liquidate, wind up or dissolve itself (or suffer any liquidation or
dissolution); provided that notwithstanding the foregoing provisions of this
Section 8.4, the following actions may be taken if (a) the Administrative Agent
is given prior written notice of such action, and the Credit Parties execute and
deliver such documents, instruments and certificates as the Collateral Agent may
request in order to maintain the perfection and priority of the Liens on the
assets of the Credit Parties, and (b) after giving effect thereto no Default or
Event of Default exists:
(a)(i) any Credit Party, other than the Parent, may be merged
or consolidated with or into the Borrower or any other Credit
Party; provided that if such transaction shall be between the
Borrower and another Credit Party, the Borrower shall be the
continuing or surviving corporation; and
(ii) any Foreign Subsidiary that is not a Canadian
Subsidiary may merge or consolidate with any other Foreign
Subsidiary that is not a Canadian Subsidiary and any Canadian
Subsidiary may merge or consolidate with any other Canadian
Subsidiary.
8.5. Sale or Lease of Assets. No Credit Party will, nor will it permit
any of its Subsidiaries to, convey, sell, lease, transfer or otherwise dispose
of, in one transaction or a series of transactions, all or any part of its
business or assets whether now owned or hereafter acquired, including, without
limitation, inventory, receivables, leasehold interests, equipment and
securities other than (a) any inventory or other assets sold, leased, licensed
or disposed of (including through commercial accommodations and going out of
business sales) or replaced within 60 days after the disposition thereof with
assets to be used in the business of the Borrower and its Subsidiaries having a
value in the aggregate at least equal to the value of the equipment disposed of
with like goods in each case in the ordinary course of business, (b) obsolete,
idle or worn-out assets no longer used or useful in its business, (c) the sale,
lease or transfer or other disposal by the Borrower or another Credit Party of
any or all of its assets or the capital stock of any other Credit Party to the
Borrower or to a Domestic Subsidiary, (d) the sale of the assets or capital
stock of any
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Foreign Subsidiary (other than a Canadian Subsidiary) to a Person other
than a Subsidiary of the Borrower so long as (i) the Borrower shall give the
Agents at least 30 days' prior written notice of such sale, which notice shall,
among other things, specify the aggregate purchase price therefore, (ii) all
non-cash consideration received in connection with such sale must be pledged to
the Collateral Agent, for the benefit of the Lenders, pursuant to documentation
reasonably requested by the Collateral Agent, and any proceeds received from
such non-cash consideration shall be paid to the Lenders when received in
accordance with Section 3.3, and (iii) the cash proceeds received in such sale
are paid to the Lenders in accordance with Section 3.3, (e) the sale or other
dispositions of Cash Equivalents for fair market value, (f) the issuance of
capital stock, (g) the transfer of assets which constitute a Permitted
Investment, (h) transfers permitted by Section 8.13, (i) other sales of assets,
including Collateral, not to exceed $5,000,000, in the aggregate, during any
fiscal year (provided that no Domestic Subsidiary may sell less than all of the
stock of any one of its Subsidiaries) or (j) other sales of assets, in addition
to those permitted by subsection (i) above, if (A) the transfer is for fair
market value, (B) at the time of transfer no Default or Event of Default exists
(except as would be cured through the application of the Net Cash Proceeds of
such Asset Disposition), (C) as a result of such transfer, no Material Adverse
Effect would occur or be reasonably likely to occur, (D) if the transfer
involves the stock of a Domestic Subsidiary, the transfer constitutes all of the
stock of such Domestic Subsidiary, (E) the proceeds from such transfer are,
within 12 months from the date of such transfer, (I) applied as a mandatory
prepayment pursuant to Section 3.3(b)(ii) or (II) reinvested in a business of a
type similar to that which the Credit Parties and their Subsidiaries are already
engaged and (F) such transfers do not exceed, in the aggregate, $25,000,000,
during any fiscal year.
Upon a sale of assets or the sale of stock of a Subsidiary of the
Borrower permitted by this Section 8.5, the Collateral Agent shall deliver to
the Borrower, upon the Borrower's request and at the Borrower's expense, such
documentation as is reasonably necessary to evidence the release of the Lenders'
security interest in such assets or stock, including, without limitation,
amendments or terminations of UCC financing statements, the return of stock
certificates and the release of a Guarantor from its obligations under the
Credit Documents.
8.6. Advances, Investments and Loans. No Credit Party will, nor
will it permit any of its Subsidiaries to, make any Investments except for
Permitted Investments.
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8.7. Dividends. No Credit Party will, nor will it permit any of its
Subsidiaries to, directly or indirectly, (a) declare or pay any dividends
(except for distributions by the Parent of its capital stock which does not by
its terms mature or become redeemable at the option of the holder thereof) or
make any other distribution upon any shares of its capital stock of any class or
(b) purchase, redeem or otherwise acquire or retire or make any provisions for
redemption, acquisition or retirement of any shares of its capital stock of any
class or any warrants or options to purchase any such shares other than a
Permitted Investment; provided that (i) any Subsidiary of the Borrower may pay
dividends to its parent or the Borrower, (ii) the Borrower may pay dividends to
the Parent (A) in amounts necessary to allow the Parent to pay its obligations
in the ordinary course and (B) in amounts necessary to allow the Parent to (I)
repurchase outstanding shares of capital stock of the Parent following the
death, disability or termination of employment of a member of Management or (II)
fund amounts payable to participants or former participants in employee benefit
plans upon any termination of employment by such participants as provided in the
documents related thereto, in an aggregate amount (for both clauses (I) and (II)
above) not to exceed $5,000,000 in any fiscal year (provided that any unused
amount may be carried over to the next succeeding fiscal year), (iii) prior to
an initial Public Equity Offering, an amount up to the sum of $10,000,000 plus
the lesser of (A) 50% of cumulative Net Income since the end of the last fiscal
quarter immediately preceding the Effective Date or (B) 50% of cumulative Excess
Cash Flow since the end of the last fiscal quarter immediately preceding the
Effective Date may be used to pay dividends or redeem stock so long as (1) no
Default or Event of Default exists and is continuing, (2) any such dividends or
redemptions shall be added to the denominator in calculating the Interest
Coverage Ratio, and (3) the sum of the amount of cash on hand on the Borrower's
consolidated balance sheet, as at the end of the month immediately prior to the
month in which such dividend or redemption is made (less the amount of such
dividends or redemptions), plus the amount of availability under the Revolving
Committed Amount (at the date of such dividend or redemption) shall be greater
than or equal to $15,000,000, (iv) subsequent to an initial Public Equity
Offering (in addition to the amounts permitted in subsection (iii) above), an
amount up to $10,000,000 may be used to pay dividends or redeem stock so long as
(A) no Default or Event of Default exists and is continuing, (B) any such
dividends or redemptions shall be added to the denominator in calculating the
Interest Coverage Ratio and (C) after giving effect to such dividends or
redemptions, the Leverage Ratio, as at the end of the fiscal quarter immediately
preceding the date of such payment, shall be less than or equal to 2.50 to 1.0
and (v) Net Cash Proceeds from a Public Equity
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Offering may be used to pay dividends or redeem stock in such amounts
as the Credit Parties may choose in their sole discretion (it being understood
that any such payments shall not be added to the denominator in calculating the
Interest Coverage Ratio); provided, such dividend or stock redemption occurs
within sixty (60) days of the Borrower's receipt of the Net Cash Proceeds from
such Public Equity Offering.
8.8. Transactions with Affiliates. Except for (a) loans or advances to
employees and officers of the Borrower or any of its Subsidiaries in the
ordinary course of business to provide for the payment of reasonable expenses
incurred by each such Persons in the performance of their responsibilities to
the Borrower or such Subsidiary or in connection with any relocation (to the
extent otherwise permitted by this Credit Agreement), (b) fees, compensation or
employee benefit arrangements paid to and indemnity provided on behalf of
directors, officers or employees of the Borrower or any of its Subsidiaries in
the ordinary course of business, (c) any employment agreement (including
customary benefits thereunder) that is entered into in the ordinary course of
business, (d) any dividend or other payment that is permitted by Section 8.7 and
(e) any transactions between or among the Borrower and any of its Subsidiaries
(to the extent otherwise permitted by this Credit Agreement), no Credit Party
will, nor will it permit its Subsidiaries to, enter into any transaction or
series of transactions, whether or not in the ordinary course of business, with
any officer, director, shareholder, Subsidiary or Affiliate other than on terms
and conditions substantially as favorable as would be obtainable in a comparable
arm's-length transaction with a Person other than an officer, director,
shareholder, Subsidiary or Affiliate.
8.9. Restrictions on the Parent and Ownership of Subsidiaries. (a) The
Parent may not hold any assets other than the stock of the Borrower and other
minimal assets related to the business of owning the stock of the Borrower and
may not have any liabilities other than the liabilities under the Credit
Documents and with respect to the Subordinated Debt and tax liabilities and
other liabilities in the ordinary course of business; (b) the Parent shall at
all times own 100% of the capital stock of the Borrower and may not sell,
transfer or otherwise dispose of any shares of capital stock of the Borrower;
(c) the Parent may not engage in any business other than owning the stock of the
Borrower and other activities directly related thereto; and (d) capital stock of
any Domestic Subsidiary may not be held by any Person other than the Borrower or
another Domestic Subsidiary.
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8.10. Fiscal Year; Organizational Documents. No Credit Party will, nor
will it permit any of its Subsidiaries to, (a) change its fiscal year without
prior written notice to the Administrative Agent (provided that no such change
may occur if such change materially affects the Lenders ability to read and
interpret the financial statements delivered pursuant to Section 7.1 or
calculate the financial covenants in Section 7.12) or (b) change its articles or
certificate of incorporation or its bylaws if such change would have or be
reasonably expected to have a Material Adverse Effect.
8.11. Subordinated Debt. No Credit Party will (a) make or offer to make
any principal payments with respect to the Subordinated Debt or Shareholder
Subordinated Indebtedness, (b) redeem or offer to redeem any of the Subordinated
Debt or Shareholder Subordinated Indebtedness, or (c) deposit any funds intended
to discharge or defease any or all of the Subordinated Debt or Shareholder
Subordinated Indebtedness; provided that (i) prior to an initial Public Equity
Offering, up to $25,000,000 may be used to repay amounts owing (including any
premiums related thereto) to holders of Subordinated Debt so long as (A) no
Default or Event of Default exists and is continuing and (B) the sum of the
amount of cash on hand on the Borrower's consolidated balance sheet, as at the
end of the month immediately prior to the month in which such payment is made
(less the amount of such payment) plus the amount of availability under the
Revolving Committed Amount (at the date of such payment) shall be greater than
or equal to $15,000,000 and (ii) the Net Cash Proceeds of a Public Equity
Offering may be used to repay amounts owing (including any premiums related
thereto) to holders of Subordinated Debt in such amounts as the Borrower may
choose in its sole discretion; provided such repayments to holders of
Subordinated Debt occurs within one hundred twenty (120) days of the Borrower's
receipt of the Net Cash Proceeds from such Public Equity Offering. Neither the
Subordinated Debt nor the Shareholder Subordinated Indebtedness may be amended
or modified in any manner that would affect the Lenders without the prior
written consent of the Required Lenders.
8.12. Limitations. No Credit Party will, nor will it permit any of its
Subsidiaries to, directly or indirectly, create or otherwise cause, incur,
assume, suffer or permit to exist or become effective any consensual encumbrance
or restriction of any kind on the ability of any such Person to (a) pay
dividends or make any other distribution on any of such Person's capital stock,
(b) pay any Indebtedness owed to the Borrower or any other Credit Party, (c)
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make loans or advances to any other Credit Party or (d) transfer any of
its property to any other Credit Party, except for encumbrances or restrictions
existing under or by reason of (i) customary non-assignment or net worth
provisions in any lease governing a leasehold interest, (ii) any agreement or
other instrument of a Person existing at the time it becomes a Subsidiary of the
Borrower; provided that such encumbrance or restriction is not applicable to any
other Person, or any property of any other Person, other than such Person
becoming a Subsidiary of the Borrower and was not entered into in contemplation
of such Person becoming a Subsidiary of the Borrower, (iii) this Credit
Agreement and the other Credit Documents, (iv) the Subordinated Debt, (v)
Indebtedness permitted by Section 8.1(c), (vi) Requirements of Law and (vii)
customary restrictions with respect to a Subsidiary of the Borrower pursuant to
an agreement that has been entered into for the sale or other disposition of all
or substantially all of the capital stock or assets of such Subsidiary.
8.13. Sale Leasebacks. No Credit Party will, nor will it permit any of
its Subsidiaries to, directly or indirectly become or remain liable as lessee or
as guarantor or other surety with respect to any lease of any property (whether
real or personal or mixed), whether now owned or hereafter acquired, (a) which
such Credit Party or Subsidiary has sold or transferred or is to sell or
transfer to any other Person other than a Credit Party or (b) which such Credit
Party or Subsidiary intends to use for substantially the same purpose as any
other property which has been sold or is to be sold or transferred by such
Credit Party or Subsidiary to any Person in connection with such lease;
provided, however, that the Credit Parties may enter into such transactions with
respect to personal property, in an aggregate amount of up to $5,000,000 in
sales proceeds during the term of this Credit Agreement, if (i) after giving pro
forma effect to any such transaction the Borrower shall be in compliance with
all other provisions of this Credit Agreement, including Section 8.1 and Section
8.2, (ii) the gross cash proceeds of any such transaction are at least equal to
the fair market value of such property (as determined by the Board of Directors
whose determination shall be conclusive if made in good faith) and (iii) the Net
Cash Proceeds are forwarded to the Administrative Agent as set forth in Section
3.3(b)(ii) to the extent required therein.
8.14. Negative Pledges. Other than as set forth in Section 4.12 of the
Indenture, none of the Credit Parties will, nor will it permit any of its
Subsidiaries to, enter into, assume or become subject to any agreement
prohibiting or otherwise restricting the
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creation or assumption of any Lien upon its properties or assets,
whether now owned or hereafter acquired, or requiring the grant of any security
for such obligation if security is given for some other obligation; provided,
however, (a) the Indebtedness incurred or assumed, as applicable, pursuant to
Sections 8.1(f) and 8.1(m) may restrict the creation of any additional Liens on
the assets securing such Indebtedness, (b) prior to the occurrence of a Release
of Collateral Event and the exercise by the Borrower of its rights under Section
11.18, a Credit Party may restrict the creation of any Liens on any assets in
which the Lenders do not have (or are not entitled to) a security interest
therein or a Lien thereon and (c) subsequent to the occurrence of a Release of
Collateral Event and the exercise by the Borrower of its rights under Section
11.18, a Credit Party may enter into an agreement that requires the grant of
security, on a pari passu basis, for the obligation evidenced by such agreement,
if security is given for another obligation.
8.15. Capital Expenditures. The Credit Parties and their Subsidiaries
will not make Capital Expenditures (other than amounts defined as Permitted
Acquisitions), in any fiscal year, that would exceed, in the aggregate,
$36,000,000 (plus casualty insurance proceeds received in connection with the
destruction of property of a Credit Party or its Subsidiaries) plus up to
$10,000,000 of any amounts for Capital Expenditures not used during the most
recent prior fiscal year; it being understood that Capital Expenditures
permitted hereunder may not be used for the purchase of either the stock or all
or substantially all of the assets of another Person.
SECTION 9.
EVENTS OF DEFAULT
9.1. Events of Default. An Event of Default shall exist upon the
occurrence of any of the following specified events (each an "Event
of Default"):
(a) Payment. Any Credit Party shall:
(i) default in the payment when due of any
principal of any of the Loans or of any reimbursement
obligation arising from drawings under Letters of Credit; or
(ii) default, and such default shall continue
for three or more Business Days, in the payment when due
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of any interest on the Loans, or on any reimbursement
obligations arising from drawings under Letters of Credit or
of any fees or other amounts owing hereunder, under any of the
other Credit Documents or in connection herewith.
(b) Representations. Any representation, warranty or statement
made or deemed to be made by any Credit Party herein, in any of the
other Credit Documents, or in any statement or certificate delivered or
required to be delivered pursuant hereto or thereto shall prove untrue
in any material respect on the date as of which it was made or deemed
to have been made.
(c) Covenants. Any Credit Party shall:
(i) default in the due performance or observance of
any term, covenant or agreement contained in Sections 7.2,
7.4, 7.6, 7.10, 7.12, 7.13, 7.14, 8.3, 8.4, 8.7, 8.9(b),
8.9(d) or 8.11; or
(ii) default in the due performance or observance by
it of any term, covenant or agreement contained in Sections
7.1, 7.5, 7.9, 8.1, 8.2, 8.5, 8.6, 8.8, 8.9(a), 8.9(c), 8.10,
8.12, 8.13, 8.14 or 8.15 and such default shall continue
unremedied for a period of five Business Days after the
earlier of an executive officer of a Credit Party becoming
aware of such default or notice thereof given by an Agent; or
(iii) default in the due performance or observance by
it of any term, covenant or agreement (other than those
referred to in subsections (a), (b) or (c)(i) or (ii) of this
Section 9.1) contained in this Credit Agreement and such
default shall continue unremedied for a period of at least 30
days after the earlier of an executive officer of a Credit
Party becoming aware of such default or notice thereof given
by an Agent.
(d) Other Credit Documents. (i) Any Credit Party shall default
in the due performance or observance of any term, covenant or agreement
in any of the other Credit Documents and such default shall continue
unremedied for a period of at least 30 days after the earlier of an
executive officer of a Credit Party becoming aware of such default or
notice thereof given by the Agent, (ii) except pursuant to the terms
thereof, any Credit Document shall fail to be in full force and effect
or any Credit Party shall so assert or (iii) except pursuant to the
terms thereof, any Credit
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Document shall fail to give the Agents and/or the Lenders the
security interests, liens, rights, powers and privileges purported to
be created thereby.
(e) Guaranties. The guaranty given by the Credit Parties
hereunder or by any Additional Credit Party hereafter or any provision
thereof shall, except pursuant to the terms thereof, cease to be in
full force and effect, or any guarantor thereunder or any Person acting
by or on behalf of such guarantor shall deny or disaffirm such
Guarantor's obligations under such guaranty.
(f) Bankruptcy, etc. The occurrence of any of the following
with respect to the Parent, the Borrower or any of their Subsidiaries
(other than an Insignificant Subsidiary) (i) a court or governmental
agency having jurisdiction in the premises shall enter a decree or
order for relief in respect of the Parent, the Borrower or any of their
Subsidiaries (other than an Insignificant Subsidiary) in an involuntary
case under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect, or appoint a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of any
of the Parent, the Borrower or any of their Subsidiaries (other than an
Insignificant Subsidiary) or for any substantial part of its property
or ordering the winding up or liquidation of its affairs; or (ii) an
involuntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect is commenced against the Parent,
the Borrower or any of their Subsidiaries (other than an Insignificant
Subsidiary) and such petition remains unstayed and in effect for a
period of 60 consecutive days; or (iii) the Parent, the Borrower or any
of their Subsidiaries (other than an Insignificant Subsidiary) shall
commence a voluntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or consent to the
entry of an order for relief in an involuntary case under any such law,
or consent to the appointment or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar
official of such Person or any substantial part of its property or make
any general assignment for the benefit of creditors; or (iv) the
Parent, the Borrower or any of their Subsidiaries (other than an
Insignificant Subsidiary) shall admit in writing its inability to pay
its debts generally as they become due or any action shall be taken by
such Person in furtherance of any of the aforesaid purposes.
(g) Defaults under Other Agreements. With respect
to any Indebtedness (other than Indebtedness outstanding under
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this Credit Agreement) of the Parent, the Borrower or any of
their Subsidiaries in an aggregate principal amount in excess of
$5,000,000, including, without limitation, the Subordinated Debt (i) a
Credit Party shall (A) default in any payment (beyond the applicable
grace period with respect thereto, if any) with respect to any such
Indebtedness, or (B) default (after giving effect to any applicable
grace period) in the observance or performance relating to such
Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event or condition shall
occur or condition exist, the effect of which default or other event or
condition is to cause, or permit, the holder or holders of such
Indebtedness (or trustee or agent on behalf of such holders) to cause
(determined without regard to whether any notice or lapse of time is
required) any such Indebtedness to become due prior to its stated
maturity; or (ii) any such Indebtedness shall be declared due and
payable, or required to be prepaid other than by a regularly scheduled
required prepayment or by a prepayment from the proceeds of an Equity
Issuance to the holders of Subordinated Debt, prior to the stated
maturity thereof.
(h) Judgments. One or more judgments, orders, or decrees shall
be entered against any one or more of the Parent, the Borrower or any
of their Subsidiaries involving a liability of $5,000,000 or more, in
the aggregate, (to the extent not paid or covered by insurance provided
by a carrier who has acknowledged coverage) and such judgments, orders
or decrees (i) are the subject of any enforcement proceeding commenced
by any creditor or (ii) shall continue unsatisfied, undischarged and
unstayed for a period ending on the first to occur of (A) the last day
on which such judgment, order or decree becomes final and unappealable
or (B) 60 days.
(i) ERISA. The occurrence of any of the following events or
conditions if such occurrence would cause or be reasonably expected to
cause a Material Adverse Effect: (A) any "accumulated funding
deficiency," as such term is defined in Section 302 of ERISA and
Section 412 of the Code, whether or not waived, shall exist with
respect to any Plan, or any lien shall arise on the assets of the
Parent, the Borrower or any of their Subsidiaries or any ERISA
Affiliate in favor of the PBGC or a Plan; (B) a Termination Event shall
occur with respect to a Single Employer Plan, which is, in the
reasonable opinion of the Agent, likely to result in the termination of
such Plan for purposes of Title IV of ERISA; (C) a Termination Event
shall occur with respect to a Multiemployer Plan or Multiple Employer
Plan, which is, in
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the reasonable opinion of the Agent, likely to result in (i)
the termination of such Plan for purposes of Title IV of ERISA, or (ii)
the Parent, the Borrower or any of their Subsidiaries or any ERISA
Affiliate incurring any liability in connection with a withdrawal from,
reorganization of (within the meaning of Section 4241 of ERISA), or
insolvency (within the meaning of Section 4245 of ERISA) of such Plan;
or (D) any prohibited transaction (within the meaning of Section 406 of
ERISA or Section 4975 of the Code) or breach of fiduciary
responsibility shall occur which may subject the Parent or any of their
Subsidiaries or any ERISA Affiliate to any liability under Sections
406, 409, 502(i), or 502(l) of ERISA or Section 4975 of the Code, or
under any agreement or other instrument pursuant to which the Parent or
any of its Subsidiaries or any ERISA Affiliate has agreed or is
required to indemnify any person against any such liability.
(j) Ownership. There shall occur a Change of Control.
(k) Subordinated Debt. (i) Any Governmental Authority with
applicable jurisdiction determines that the Lenders are not holders of
Designated Senior Indebtedness (as defined in the Indenture) or any
Governmental Authority makes a similar determination with respect to
Shareholder Subordinated Indebtedness or (ii) the subordination
provisions creating the Subordinated Debt or the Shareholder
Subordinated Indebtedness shall, in whole or in part, terminate, cease
to be effective or cease to be legally valid, binding and enforceable
as to any holder of the Subordinated Debt or Shareholder Subordinated
Indebtedness.
9.2. Acceleration; Remedies. Upon the occurrence of an Event of
Default, and at any time thereafter unless and until such Event of Default has
been waived in writing by the Required Lenders (or the Lenders as may be
required hereunder), the Administrative Agent shall, upon the request and
direction of the Required Lenders, by written notice to the Borrower, take any
of the following actions without prejudice to the rights of the Agents or any
Lender to enforce its claims against the Credit Parties, except as otherwise
specifically provided for herein:
(a) Termination of Commitments. Declare the Commitments
terminated whereupon the Commitments shall be immediately terminated.
(b) Acceleration of Loans. Declare the unpaid
principal of and any accrued interest in respect of all Loans, any
reimbursement obligations arising from drawings
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under Letters of Credit and any and all other indebtedness or
obligations of any and every kind owing by a Credit Party to any of the
Lenders hereunder to be due whereupon the same shall be immediately due
and payable without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Credit Parties.
(c) Cash Collateral. Direct the Borrower to pay (and the
Borrower agrees that upon receipt of such notice, or upon the
occurrence of an Event of Default under Section 9.1(f), they will
immediately pay) to the Administrative Agent additional cash, to be
held by the Administrative Agent, for the benefit of the Lenders, in a
cash collateral account as additional security for the LOC Obligations
in respect of subsequent drawings under all then outstanding Letters of
Credit in an amount equal to the maximum aggregate amount which may be
drawn under all Letters of Credits then outstanding.
(d) Enforcement of Rights. Enforce any and all rights and
interests created and existing under the Credit Documents, including,
without limitation, all rights and remedies existing under the
Collateral Documents, all rights and remedies against a Guarantor and
all rights of set-off.
Notwithstanding the foregoing, if an Event of Default specified in Section
9.1(f) shall occur, then the Commitments shall automatically terminate and all
Loans, all reimbursement obligations under Letters of Credit, all accrued
interest in respect thereof, all accrued and unpaid fees and other indebtedness
or obligations owing to the Lenders hereunder shall immediately become due and
payable without the giving of any notice or other action by the Agents or the
Lenders, which notice or other action is expressly waived by the Credit Parties.
Notwithstanding the fact that enforcement powers reside primarily with the
Administrative Agent, each Lender has, to the extent permitted by law, a
separate right of payment and shall be considered a separate "creditor" holding
a separate "claim" within the meaning of Section 101(5) of the Bankruptcy Code
or any other insolvency statute.
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SECTION 10.
AGENCY PROVISIONS
10.1. Appointment. Each Lender hereby designates and appoints
NationsBank, N.A. as Administrative Agent and Collateral Agent and The Chase
Manhattan Bank as Documentation Agent of such Lender to act as specified herein
and the other Credit Documents, and each such Lender hereby authorizes the
Agents, as the agents for such Lender, to take such action on its behalf under
the provisions of this Credit Agreement and the other Credit Documents and to
exercise such powers and perform such duties as are expressly delegated by the
terms hereof and of the other Credit Documents, together with such other powers
as are reasonably incidental thereto. Notwithstanding any provision to the
contrary elsewhere herein and in the other Credit Documents, the Agents shall
not have any duties or responsibilities, except those expressly set forth herein
and therein, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Credit Agreement or any of the other Credit Documents, or
shall otherwise exist against the Agents. The provisions of this Section (other
than Section 10.9) are solely for the benefit of the Agents and the Lenders and
none of the Credit Parties shall have any rights as a third party beneficiary of
the provisions hereof (other than Section 10.9). In performing its functions and
duties under this Credit Agreement and the other Credit Documents, each Agent
shall act solely as an agent of the Lenders and does not assume and shall not be
deemed to have assumed any obligation or relationship of agency or trust with or
for any Credit Party.
10.2. Delegation of Duties. An Agent may execute any of its duties
hereunder or under the other Credit Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. An Agent shall not be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by it with
reasonable care.
10.3. Exculpatory Provisions. Neither the Agents nor any of their
officers, directors, employees, agents, attorneys-in-fact or affiliates shall be
(a) liable for any action lawfully taken or omitted to be taken by it or such
Person under or in connection herewith or in connection with any of the other
Credit Documents (except for its or such Person's own gross negligence or
willful
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misconduct) or (b) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties made by any of the
Credit Parties contained herein or in any of the other Credit Documents or in
any certificate, report, document, financial statement or other written or oral
statement referred to or provided for in, or received by an Agent under or in
connection herewith or in connection with the other Credit Documents, or
enforceability or sufficiency therefor of any of the other Credit Documents, or
for any failure of the Borrower to perform its obligations hereunder or
thereunder. The Agents shall not be responsible to any Lender for the
effectiveness, genuineness, validity, enforceability, collectibility or
sufficiency of this Credit Agreement, or any of the other Credit Documents or
for any representations, warranties, recitals or statements made herein or
therein or made by the Borrower or any Credit Party in any written or oral
statement or in any financial or other statements, instruments, reports,
certificates or any other documents in connection herewith or therewith
furnished or made by an Agent to the Lenders or by or on behalf of the Credit
Parties to the Agents or any Lender or be required to ascertain or inquire as to
the performance or observance of any of the terms, conditions, provisions,
covenants or agreements contained herein or therein or as to the use of the
proceeds of the Loans or the use of the Letters of Credit or of the existence or
possible existence of any Default or Event of Default or to inspect the
properties, books or records of the Credit Parties. The Agents are not trustees
for the Lenders and owe no fiduciary duty to the Lenders.
10.4. Reliance on Communications. The Agents shall be entitled to rely,
and shall be fully protected in relying, upon any note, writing, resolution,
notice, consent, certificate, affidavit, letter, cablegram, telegram, telecopy,
telex or teletype message, statement, order or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to any of the Credit Parties,
independent accountants and other experts selected by the Agents with reasonable
care). The Agents may deem and treat the Lenders as the owner of its interests
hereunder for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent in
accordance with Section 11.3(b). The Agents shall be fully justified in failing
or refusing to take any action under this Credit Agreement or under any of the
other Credit Documents unless it shall first receive such advice or concurrence
of the Required Lenders as it deems appropriate or it shall first be indemnified
to its satisfaction by the Lenders
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against any and all liability and expense which may be incurred by it
by reason of taking or continuing to take any such action. The Agents shall in
all cases be fully protected in acting, or in refraining from acting, hereunder
or under any of the other Credit Documents in accordance with a request of the
Required Lenders (or to the extent specifically provided in Section 11.6, all
the Lenders) and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders (including their successors and
assigns).
10.5. Notice of Default. An Agent shall not be deemed to have knowledge
or notice of the occurrence of any Default or Event of Default hereunder unless
such Agent has received notice from a Lender or a Credit Party referring to the
Credit Document, describing such Default or Event of Default and stating that
such notice is a "notice of default." In the event that the Administrative Agent
receives such a notice, the Administrative Agent shall give prompt notice
thereof to the Lenders. The Administrative Agent shall take such action with
respect to such Default or Event of Default as shall be reasonably directed by
the Required Lenders.
10.6. Non-Reliance on Agents and Other Lenders. Each Lender expressly
acknowledges that neither the Agents nor any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates has made any representations
or warranties to it and that no act by the Agents or any affiliate thereof
hereinafter taken, including any review of the affairs of any Credit Party,
shall be deemed to constitute any representation or warranty by the Agents to
any Lender. Each Lender represents to the Agents that it has, independently and
without reliance upon the Agents or any other Lender, and based on such
documents and information as it has deemed appropriate, made its own appraisal
of and investigation into the business, assets, operations, property, financial
and other conditions, prospects and creditworthiness of the Credit Parties and
made its own decision to make its Loans hereunder and enter into this Credit
Agreement. Each Lender also represents that it will, independently and without
reliance upon the Agents or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Credit Agreement, and to make such investigation as it deems necessary to
inform itself as to the business, assets, operations, property, financial and
other conditions, prospects and creditworthiness of the Credit Parties. Except
for notices, reports and other documents expressly required to be furnished to
the Lenders by the Administrative Agent hereunder, the Agents shall not have any
duty or
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responsibility to provide any Lender with any credit or other
information concerning the business, operations, assets, property, financial or
other conditions, prospects or creditworthiness of the Credit Parties which may
come into the possession of the Agents or any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates.
10.7. Indemnification. The Lenders agree to indemnify each Agent in its
capacity as such (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), ratably according to their
respective Commitments (or if the Commitments have expired or been terminated,
in accordance with the respective principal amounts of outstanding Loans and
Participation Interest of the Lenders), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including without limitation at any time following payment in full of the
Credit Party Obligations) be imposed on, incurred by or asserted against an
Agent in its capacity as such in any way relating to or arising out of this
Credit Agreement or the other Credit Documents or any documents contemplated by
or referred to herein or therein or the transactions contemplated hereby or
thereby or any action taken or omitted by an Agent under or in connection with
any of the foregoing; provided that no Lender shall be liable for the payment of
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
gross negligence or willful misconduct of an Agent. If any indemnity furnished
to an Agent for any purpose shall, in the opinion of such Agent, be insufficient
or become impaired, such Agent may call for additional indemnity and cease, or
not commence, to do the acts indemnified against until such additional indemnity
is furnished; provided that no Agent shall be indemnified for any event caused
by its gross negligence or willful misconduct. The agreements in this Section
shall survive the payment of the Credit Party Obligations and all other amounts
payable hereunder and under the other Credit Documents.
10.8. Agents in Their Individual Capacity. Each Agent and its
affiliates may make loans to, accept deposits from and generally engage in any
kind of business with the Borrower or any other Credit Party as though such
Agent were not an Agent hereunder. With respect to the Loans made and Letters of
Credit issued and all obligations owing to it, an Agent shall have the same
rights and powers under this Credit Agreement as any Lender and may exercise the
same as though they were not an Agent, and
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the terms "Lender" and "Lenders" shall include each Agent in its individual
capacity.
10.9. Successor Agent. Any Agent may, at any time, resign upon 20 days
written notice to the Lenders. Upon any such resignation, 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, and shall have accepted such
appointment, within 45 days after the notice of resignation, then the retiring
Agent shall select a successor Agent provided such successor is a Lender
hereunder or a commercial bank organized under the laws of the United States of
America or of any State thereof and has a combined capital and surplus of at
least $400,000,000. Upon the acceptance of any appointment as an Agent hereunder
by a successor, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations as an
Agent, as appropriate, under this Credit Agreement and the other Credit
Documents and the provisions of this Section 10.9 shall inure to its benefit as
to any actions taken or omitted to be taken by it while it was an Agent under
this Credit Agreement. There shall at all times be a Person servicing as
Administrative Agent hereunder and, so long as no Default or Event of Default
shall have occurred and be continuing, the appointment of any new Administrative
Agent shall require the consent of the Borrower (which consent shall not be
unreasonably withheld).
SECTION 11.
MISCELLANEOUS
11.1. Notices. Except as otherwise expressly provided herein, all
notices and other communications shall have been duly given and shall be
effective (a) when delivered, (b) when transmitted via telecopy (or other
facsimile device) to the number set out below, (c) the Business Day following
the day on which the same has been delivered prepaid to a reputable national
overnight air courier service, or (d) the third Business Day following the day
on which the same is sent by certified or registered mail, postage prepaid, in
each case to the respective parties at the address or telecopy numbers set forth
on Schedule 11.1, or at such other address as such party may specify by written
notice to the other parties hereto.
11.2. Right of Set-Off. In addition to any rights now or hereafter
granted
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under applicable law or otherwise, and not by way of limitation of any
such rights, upon the occurrence of an Event of Default and the commencement of
remedies described in Section 9.2, each Lender is authorized at any time and
from time to time, without presentment, demand, protest or other notice of any
kind (all of which rights being hereby expressly waived), to set-off and to
appropriate and apply any and all deposits (general or special) and any other
indebtedness at any time held or owing by such Lender (including, without
limitation, branches, agencies or Affiliates of such Lender wherever located) to
or for the credit or the account of any Credit Party against obligations and
liabilities of such Credit Party to the Lenders hereunder, under the Notes, the
other Credit Documents or otherwise, irrespective of whether the Administrative
Agent or the Lenders shall have made any demand hereunder and although such
obligations, liabilities or claims, or any of them, may be contingent or
unmatured, and any such set-off shall be deemed to have been made immediately
upon the occurrence of an Event of Default even though such charge is made or
entered on the books of such Lender subsequent thereto. The Credit Parties
hereby agree that to the extent permitted by law any Person purchasing a
participation in the Loans and Commitments hereunder pursuant to Section 11.3(c)
or 3.9 may exercise all rights of set-off with respect to its participation
interest as fully as if such Person were a Lender hereunder and any such set-off
shall reduce the amount owed by such Credit Party to the Lender.
11.3. Benefit of Agreement.
(a) Generally. This Credit Agreement shall be binding upon and
inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto; provided that none of the Credit
Parties may assign and transfer any of its interests in violation of
Section 8.4 or 8.5 or without the prior written consent of either the
Required Lenders or the Lenders, as the terms set forth in Section 11.6
may require; and provided further that the rights of each Lender to
transfer, assign or grant participations in its rights and/or
obligations hereunder shall be limited as set forth below in
subsections (b) and (c) of this Section 11.3. Notwithstanding the above
(including anything set forth in subsections (b) and (c) of this
Section 11.3), nothing herein shall restrict, prevent or prohibit (i)
any Lender from (A) pledging its Loans hereunder to a Federal Reserve
Bank in support of borrowings made by such Lender from such Federal
Reserve Bank, or (B) granting assignments or participations in such
Lender's Loans and/or Commitments hereunder to its parent company
and/or to any Affiliate of such Lender or to any existing
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Lender or Affiliate thereof or (ii) any Credit Party from engaging in
a transaction permitted by Section 8.4 or 8.5.
(b) Assignments. In addition to the assignments permitted by
Section 11.3(a), each Lender may, with the prior written consent of the
Borrower and the Administrative Agent (provided that no consent of the
Borrower shall be required during the existence and continuation of an
Event of Default), which consent shall not be unreasonably withheld or
delayed, assign all or a portion of its rights and obligations
hereunder pursuant to an assignment agreement substantially in the form
of Exhibit 11.3 to one or more Eligible Assignees; provided that (i)
any such assignment shall be in a minimum aggregate amount of
$5,000,000 of the Commitments and in integral multiples of $1,000,000
above such amount (or the remaining amount of Commitments held by such
Lender) and (ii) each such assignment shall be of a constant, not
varying, percentage of all of the assigning Lender's rights and
obligations under the Commitment being assigned. Any assignment
hereunder shall be effective upon satisfaction of the conditions set
forth above and delivery to the Administrative Agent of a duly executed
assignment agreement together with a transfer fee of $3,500 payable to
the Administrative Agent for its own account; provided that any
assignment required to be made by a Lender pursuant to Section 3.16
shall not require a transfer fee. Upon the effectiveness of any such
assignment, the assignee shall become a "Lender" for all purposes of
this Credit Agreement and the other Credit Documents and, to the extent
of such assignment, the assigning Lender shall be relieved of its
obligations hereunder to the extent of the Loans and Commitment
components being assigned. Along such lines the Borrower agrees that
upon notice of any such assignment and surrender of the appropriate
Note or Notes, it will promptly provide to the assigning Lender and to
the assignee separate promissory notes in the amount of their
respective interests substantially in the form of the original Note or
Notes (but with notation thereon that it is given in substitution for
and replacement of the original Note or Notes or any replacement notes
thereof).
By executing and delivering an assignment agreement in accordance with
this Section 11.3(b), the assigning Lender thereunder and the assignee
thereunder shall be deemed to confirm to and agree with each other and
the other parties hereto as follows: (i) such assigning Lender warrants
that it is the legal and beneficial owner of the interest being
assigned thereby free and clear of any adverse claim and the assignee
warrants that it is an Eligible Assignee; (ii)
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except as set forth in clause (i) above, 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 this Credit Agreement, any of the other Credit
Documents or any other instrument or document furnished pursuant hereto
or thereto, or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Credit Agreement, any of the
other Credit Documents or any other instrument or document furnished
pursuant hereto or thereto or the financial condition of any Credit
Party or the performance or observance by any Credit Party of any of
its obligations under this Credit Agreement, any of the other Credit
Documents or any other instrument or document furnished pursuant hereto
or thereto; (iii) such assignee represents and warrants that it is
legally authorized to enter into such assignment agreement; (iv) such
assignee confirms that it has received a copy of this Credit Agreement,
the other Credit Documents and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision
to enter into such assignment agreement; (v) such assignee will
independently and without reliance upon the Agents, 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 Credit
Agreement and the other Credit Documents; (vi) such assignee appoints
and authorizes the Agents to take such action on its behalf and to
exercise such powers under this Credit Agreement or any other Credit
Document as are delegated to the Agents by the terms hereof or thereof,
together with such powers as are reasonably incidental thereto; and
(vii) such assignee agrees that it will perform in accordance with
their terms all the obligations which by the terms of this Credit
Agreement and the other Credit Documents are required to be performed
by it as a Lender.
(c) Participations. Each Lender may sell, transfer, grant or
assign participations in all or any part of such Lender's interests and
obligations hereunder; provided that (i) such selling Lender shall
remain a "Lender" for all purposes under this Credit Agreement (such
selling Lender's obligations under the Credit Documents remaining
unchanged) and the participant shall not constitute a Lender hereunder,
(ii) no such participant shall have, or be granted, rights to approve
any amendment or waiver relating to this Credit Agreement or the other
Credit Documents except to the extent any such amendment or waiver
would (A) reduce the principal of or rate of interest on or fees in
respect of any Loans in which the participant is participating or
increase any
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Commitments with respect thereto, (B) postpone the date fixed
for any payment of principal (including the extension of the final
maturity of any Loan or the date of any mandatory prepayment pursuant
to Section 2.3(d)), interest or fees in which the participant is
participating, or (C) release all or substantially all of the
collateral or guaranties (except as expressly provided in the Credit
Documents) supporting any of the Loans or Commitments in which the
participant is participating, (iii) sub-participations by the
participant (except to an Affiliate, parent company or Affiliate of a
parent company of the participant) shall be prohibited and (iv) any
such participations shall be in a minimum aggregate amount of
$5,000,000 of the Commitments and in integral multiples of $1,000,000
in excess thereof. In the case of any such participation, the
participant shall not have any rights under this Credit Agreement or
the other Credit Documents (the participant's rights against the
selling Lender in respect of such participation to be those set forth
in the participation agreement with such Lender creating such
participation) and all amounts payable by the Borrower hereunder shall
be determined as if such Lender had not sold such participation;
provided, however, that such participant shall be entitled to receive
additional amounts under Section 3.15 to the same extent that the
Lender from which such participant acquired its participation would be
entitled to the benefit of such cost protection provisions and the
amount otherwise payable to such Lender shall be so reduced.
(d) Registration. The Administrative Agent, acting for this
purpose solely on behalf of the Borrower, shall maintain a register
(the "Register") for the recordation of the names and addresses of the
Lenders and the principal amount of the Loans owing to each Lender from
time to time. The entries in the Register shall be conclusive, in the
absence of manifest error, and the Borrower, the Administrative Agent
and the Lenders shall treat each Person whose name is recorded in the
Register as the owner of a Loan or other obligation hereunder for all
purposes of this Credit Agreement and the other Credit Documents,
notwithstanding notice to the contrary. Any assignment of any Loan or
other obligation hereunder shall be effective only upon appropriate
entries with respect thereto being made in the Register. The Register
shall be available for inspection by the Borrower or any Lender at any
reasonable time and from time to time upon reasonable prior notice.
11.4. No Waiver; Remedies Cumulative. No failure or delay
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on the part of an Agent or any Lender in exercising any right, power or
privilege hereunder or under any other Credit Document and no course of dealing
between the Borrower or any Credit Party and the Agents or any Lender shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, power or privilege hereunder or under any other Credit Document preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege hereunder or thereunder. The rights and remedies provided herein
are cumulative and not exclusive of any rights or remedies which the Agents or
any Lender would otherwise have. No notice to or demand on any Credit Party in
any case shall entitle any Credit Party to any other or further notice or demand
in similar or other circumstances or constitute a waiver of the rights of the
Agents or the Lenders to any other or further action in any circumstances
without notice or demand.
11.5. Payment of Expenses; Indemnification. The Credit Parties agree
to: (a) pay all reasonable out-of-pocket costs and expenses of (i) the Agents in
connection with (A) the negotiation, preparation, execution and delivery and
administration of this Credit Agreement and the other Credit Documents and the
documents and instruments referred to therein (including, without limitation,
the reasonable fees and expenses of Xxxxx & Xxx Xxxxx, special counsel to the
Agents and the fees and expenses of counsel for the Agents in connection with
collateral or foreign issues but not the fees and expenses of any other Lender's
counsel), and (B) any amendment, waiver or consent relating hereto and thereto
including, but not limited to, any such amendments, waivers or consents
resulting from or related to any work-out, renegotiation or restructure relating
to the performance by the Credit Parties under this Credit Agreement and (ii)
the Agents and the Lenders in connection with (A) enforcement of the Credit
Documents and the documents and instruments referred to therein, including,
without limitation, in connection with any such enforcement, the reasonable fees
and disbursements of counsel for the Agents and each of the Lenders, and (B) any
bankruptcy or insolvency proceeding of a Credit Party of any of its Subsidiaries
and (b) indemnify each Agent and each Lender, its officers, directors,
employees, representatives and agents from and hold each of them harmless
against any and all losses, liabilities, claims, damages or expenses incurred by
any of them as a result of, or arising out of, or in any way related to, or by
reason of, any investigation, litigation or other proceeding (whether or not any
Agent or Lender is a party thereto) related to (i) the entering into and/or
performance of any Credit Document or the use of proceeds of any Loans
(including other extensions of credit) hereunder or the consummation of any
other transactions contemplated in any Credit
115
Document, including, without limitation, the reasonable fees and
disbursements of counsel incurred in connection with any such investigation,
litigation or other proceeding (but excluding any such losses, liabilities,
claims, damages or expenses to the extent incurred by reason of gross negligence
or willful misconduct on the part of the Person to be indemnified), (ii) any
Environmental Claim (except to the extent such claim arises from the gross
negligence or willful misconduct of any indemnified party) and (iii) any claims
for Non-Excluded Taxes; provided that no indemnity or reimbursement shall be
required in respect of (a) any claims relating to the rights of a Lender as a
holder of the Subordinated Debt or (b) any claims relating to the obligations of
any indemnified party in any capacity other than as a Agent or a Lender.
11.6. Amendments, Waivers and Consents. Neither this Credit Agreement
nor any other Credit Document nor any of the terms hereof or thereof may be
amended, changed, waived, discharged or terminated unless such amendment,
change, waiver, discharge or termination is in writing and signed by the
Required Lenders and the then Credit Parties; provided that no such amendment,
change, waiver, discharge or termination shall (a), without the consent of each
Lender affected thereby,
(i) extend the final maturity of any Loan
or extend or waive any Principal Amortization Payment of
any Loan, or any portion thereof,
(ii) reduce the rate or extend the time of payment of
interest (other than as a result of waiving the applicability
of any post-default increase in interest rates) thereon or
fees hereunder,
(iii) reduce or waive the principal amount of any
Loan,
(iv) increase the Commitment of a Lender over the
amount thereof in effect (it being understood and agreed that
a waiver of any Default or Event of Default or a mandatory
reduction in the Commitments shall not constitute a change in
the terms of any Commitment of any Lender),
(v) release all or substantially all of the
Collateral securing the Credit Party Obligations hereunder
(provided that the Collateral Agent may, without consent from
any other Lender, release any Collateral that is sold or
transferred by a Credit
116
Party in conformance with Section 8.5 or released in
conformance with Section 11.18),
(vi) release the Borrower or substantially all of the
other Credit Parties from its obligations under the Credit
Documents (provided that the Collateral Agent may, without
consent from any other Lender, release any Guarantor that is
sold or transferred in conformance with Section 8.5),
(vii) amend, modify or waive any provision of this
Section or Section 3.4(a), 3.4(b)(i), 3.7, 3.8, 3.9, 3.10,
3.11, 3.12, 3.13, 3.14, 3.15, 3.16, 9.1(a), 11.2, 11.3 or
11.5,
(viii) reduce any percentage specified in, or
otherwise modify, the definition of Required Lenders or
(ix) consent to the assignment or transfer by the
Borrower (or substantially all of the other Credit Parties) of
any of its rights and obligations under (or in respect of) the
Credit Documents except as permitted thereby; and
(b) no provision of Section 10 may be amended without the
consent of the Agents.
Notwithstanding the above, the right to deliver a Payment Blockage Notice (as
defined in the Indenture) shall reside solely with the Administrative Agent and
the Administrative Agent shall deliver such Payment Blockage Notice only upon
the direction of the Required Lenders.
Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any bankruptcy reorganization plan that affects the
Loans or the Letters of Credit, and each Lender acknowledges that the provisions
of Section 1126(c) of the Bankruptcy Code supersedes the unanimous consent
provisions set forth herein and (y) the Required Lenders may consent to allow a
Credit Party to use cash collateral in the context of a bankruptcy or insolvency
proceeding.
11.7. Counterparts. This Credit Agreement may be executed in any number
of counterparts, each of which where so executed and delivered shall be an
original, but all of which shall constitute one and the
117
same instrument. It shall not be necessary in making proof of this
Credit Agreement to produce or account for more than one such counterpart.
Delivery of an executed counterpart by facsimile shall be as effective as an
original executed counterpart and shall be deemed a representation that an
original executed counterpart will be delivered.
11.8. Headings. The headings of the sections and subsections hereof are
provided for convenience only and shall not in any way affect the meaning or
construction of any provision of this Credit Agreement.
11.9. Defaulting Lender. Each Lender understands and agrees that if
such Lender is a Defaulting Lender then notwithstanding the provisions of
Section 11.6 it shall not be entitled to vote on any matter requiring the
consent of the Required Lenders or to object to any matter requiring the consent
of all the Lenders adversely affected thereby; provided, however, that all other
benefits and obligations under the Credit Documents shall apply to such
Defaulting Lender.
11.10. Survival of Indemnification and Representations and Warranties.
All indemnities set forth herein and all representations and warranties made
herein shall survive the execution and delivery of this Credit Agreement, the
making of the Loans, the issuance of the Letters of Credit and the repayment of
the Loans, LOC Obligations and other obligations and the termination of the
Commitments hereunder.
11.11. Governing Law; Venue.
(a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE
GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK. Any legal action or proceeding with respect
to this Agreement or any other Credit Document may be brought in the
courts of the State of North Carolina or the State of New York, or of
the United States for either the Western District of North Carolina or
the Southern District of New York, and, by execution and delivery of
this Credit Agreement, each Credit Party hereby irrevocably accepts for
itself and in respect of its property, generally and unconditionally,
the jurisdiction of such courts. Each Credit Party further irrevocably
consents to the service of
118
process out of any of the aforementioned courts in any such
action or proceeding by the mailing of copies thereof by registered or
certified mail, postage prepaid, to it at the address for notices
pursuant to Section 11.1, such service to become effective 30 days
after such mailing. Nothing herein shall affect the right of a Lender
to serve process in any other manner permitted by law or to commence
legal proceedings or to otherwise proceed against a Credit Party in any
other jurisdiction.
(b) Each Credit Party hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with
this Agreement or any other Credit Document brought in the courts
referred to in subsection (a) hereof and hereby further irrevocably
waives and agrees not to plead or claim in any such court that any such
action or proceeding brought in any such court has been brought in an
inconvenient forum.
11.12. Waiver of Jury Trial. EACH OF THE PARTIES TO THIS AGREEMENT
HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OF THE OTHER
CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY.
11.13. Time. All references to time herein shall be references
to Eastern Standard Time or Eastern Daylight time, as the case may be, unless
specified otherwise.
11.14. Severability. If any provision of any of the Credit Documents is
determined to be illegal, invalid or unenforceable, such provision shall be
fully severable and the remaining provisions shall remain in full force and
effect and shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.
11.15. Entirety. This Credit Agreement together with the other Credit
Documents represent the entire agreement of the parties hereto and thereto, and
supersede all prior agreements and understandings, oral or written, if any,
including any commitment letters or correspondence relating to the Credit
Documents or the transactions contemplated herein and therein.
11.16. Binding Effect; Termination of Prior Credit Agreement. This
Credit Agreement shall become effective at such time when all of the conditions
set forth in Section 5.1 have been satisfied or waived by the Lenders and it
shall have been executed by the Borrower, the Guarantors and the Agents, and the
Agents shall have received copies hereof (telefaxed or otherwise) which, when
taken together, bear the signatures of each Lender, and thereafter this Credit
Agreement shall be binding upon and inure to the benefit of the Borrower, the
Guarantors, the Agents and each Lender and their respective successors and
assigns. Upon this Credit Agreement becoming effective, the Prior Credit
Agreement shall be deemed terminated and the lenders party to the Prior Credit
Agreement shall no longer have any obligations thereunder.
11.17. Confidentiality. Each Lender agrees that it will use its
reasonable best efforts to keep confidential and to cause any representative
designated under Section 7.11 to keep confidential any non-public information
from time to time supplied to it under any Credit Document; provided, however,
that nothing herein shall affect the disclosure of any such information to (i)
the extent such Lender in good faith believes is required by statute, rule,
regulation or judicial process, (ii) counsel for such Lender or to its
accountants, (iii) bank examiners or auditors or comparable Persons, (iv) any
affiliate of such Lender, (v) any other Lender, or any assignee, transferee or
119
participant, or any potential assignee, transferee or participant, of all or any
portion of any Lender's rights under this Agreement who is notified of the
confidential nature of the information and agrees to be bound by this provision
or provisions reasonably comparable hereto, or (vi) any other Person in
connection with any litigation to which any one or more of the Lenders is a
party; and provided further that no Lender shall have any obligation under this
Section 11.17 to the extent any such information becomes available on a
non-confidential basis from a source other than a Credit Party or its
Subsidiaries or that any information becomes publicly available other than by a
breach of this Section 11.17. Each Lender agrees it will use all confidential
information exclusively for the purpose of evaluating, monitoring, selling,
protecting or enforcing its Loans and other rights under the Credit Documents.
Without affecting any other rights of the Borrower and the Credit Parties, each
Lender acknowledges that the Borrower shall be entitled to seek the remedies of
injunction, specific performance and other equitable relief for any breach of
the provisions of this Section 11.17.
11.18. Release of Collateral. Upon the occurrence of a Release of
Collateral Event, the Lenders agree, upon the request and at the expense of the
Borrower, to take such action as is necessary to release all Collateral securing
the Credit Par Obligations. The Lenders hereby authorize the Collateral Agent to
execute and deliver such documentation or to take such other action as is
necessary to give effect to this Section 11.18.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
120
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
Each of the parties hereto has caused a counterpart of this Credit
Agreement to be duly executed and delivered as of the date first above written.
BORROWER:
XXXXX, INC.,
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President and
Chief Financial Officer
GUARANTORS: T.K.G. ACQUISITION CORP.,
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President
and Chief Financial Officer
KNOLL OVERSEAS, INC.,
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President and
Chief Financial Officer
SPINNEYBECK ENTERPRISES, INC.,
a New York corporation
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President and
Chief Financial Officer
121
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
LENDERS:
NATIONSBANK, N.A.,
individually in its capacity as a
Lender and in its capacity as Administrative
Agent
By: /s/ Xxxxxx Xxxx
Name: Xxxxxx Xxxx
Title: Vice President
THE CHASE MANHATTAN BANK,
individually in its capacity as a Lender
and in its capacity as Documentation
Agent
By: /s/ Xxxxxxxx Xxxxxxx, Xx.
Name: Xxxxxxxx Xxxxxxx, Xx.
Title: Attorney-in-Fact
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
MARINE MIDLAND BANK
By: /s/ X. X. Xxxxx
Name: X. X. Xxxxx
Title: Senior Vice President
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
CORESTATES BANK, N.A.
By: /s/ Xxxx X. Xxxx
Name: Xxxx X. Xxxx
Title: Vice President
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
COMERICA BANK
By: /s/ Xxxx X. Xxxxx
Name: Xxxx X. Xxxxx
Title: Vice President
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: Assistant Vice President
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
TORONTO DOMINION (NEW YORK), INC.
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Vice President
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
FIRST UNION NATIONAL BANK OF NORTH
CAROLINA
By: /s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
BANK OF SCOTLAND
By: /s/ Xxxxxxxxx X. Xxxxxxxx
Name: Xxxxxxxxx X. Xxxxxxxx
Title: Vice President
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
CAISSE NATIONALE DE CREDIT AGRICOLE
By: /s/ Xxxx XxXxxxxxx
Name: Xxxx XxXxxxxxx
Title: Vice President
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
SUMMIT BANK
By: /s/ Xxxxxxxxxxx X. Xxxxx
Name: Xxxxxxxxxxx X. Xxxxx
Title: Regional Vice President
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
CIBC, INC.
By: /s/ Xxxxxx X. Sendok
Name: Xxxxxx X. Sendok
Title: Associate Director
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
THE BANK OF NOVA SCOTIA
By: /s/ Xxxxx Xxxxx
Name: Xxxxx Xxxxx
Title: Senior Relationship Manager
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
THE BANK OF NEW YORK
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Vice President
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
THE DAI-ICHI KANGYO BANK, LTD.
By: /s/ Xxxxxx Xxxxxxxx
Name: Xxxxxx Xxxxxxxx
Title: Vice President & Group Leader
Signature page to Amended and Restated Credit Agreement, dated as of
December 17, 1996, among Xxxxx, Inc. as Borrower, T.K.G. Acquisition Corp. and
the Domestic Subsidiaries of Xxxxx, Inc. as Guarantors, the Lenders party
thereto, NationsBank, N.A. as Agent and The Chase Manhattan Bank as
Documentation Agent.
FLEET NATIONAL BANK
By: /s/ Xxx X. Xxxxx
Name: Xxx X. Xxxxx
Title: Senior Vice President
Exhibit 2.1
to
Amended and Restated
Credit Agreement
FORM OF NOTICE OF BORROWING
TO: NATIONSBANK, N.A., as Administrative Agent
XXXXXXXXXXX XXXXXXXXX XXXXXX
XXXXXXXXX, XXXXX XXXXXXXX 00000
RE: Amended and Restated Credit Agreement dated as of December
___, 1996 among Xxxxx, Inc. (the "Borrower"), T.K.G.
Acquisition Corp., the Domestic Subsidiaries of the Borrower,
NationsBank, N.A., as Administrative Agent, The Chase
Manhattan Bank, as Documentation Agent and the Lenders party
thereto (as the same may be amended, modified, extended or
restated from time to time, the "Credit Agreement")
DATE: _____________, 199__
-----------------------------------------------------------------
1. This Notice of Borrowing is made pursuant to the terms of the Credit
Agreement. All capitalized terms used herein unless otherwise defined
shall have the meanings set forth in the Credit Agreement.
2. Please be advised that the Borrower is requesting Revolving Loans in
the amount of $__________ to be funded on ____________, 199__ at the
interest rate option set forth in paragraph 3 below. Subsequent to the
funding of the requested Revolving Loans, the aggregate amount of
outstanding Revolving Loans will be $_________, which together with the
aggregate amount of outstanding LOC Obligations is less than or equal
to the Revolving Committed Amount.
2
3. The interest rate option applicable to the requested Revolving Loans
shall be:
a. ________ the Adjusted Base Rate
b. ________the Adjusted Eurodollar Rate for
an Interest Period of:
________ one month
________ two months
________ three months
________ six months
4. The representations and warranties made by the Credit Parties in the
Credit Documents are true and correct in all material respects at and
as if made on the date hereof except to the extent they expressly
relate to an earlier date.
5. As of the date hereof, no Default or Event of Default has occurred
and is continuing or would be caused by this Notice of Borrowing.
6. No Material Adverse Effect has occurred since the Closing Date.
XXXXX, INC.
By:____________________________
Name:__________________________
Title:_________________________
Exhibit 2.4
to
Amended and Restated
Credit Agreement
FORM OF NOTICE OF CONTINUATION/CONVERSION
TO: NATIONSBANK, N.A., as Administrative Agent
XXXXXXXXXXX XXXXXXXXX XXXXXX
XXXXXXXXX, XXXXX XXXXXXXX 00000
RE: Amended and Restated Credit Agreement dated as of December
___, 1996 among Xxxxx, Inc. (the "Borrower"), T.K.G.
Acquisition Corp., the Domestic Subsidiaries of the Borrower,
NationsBank, N.A., as Administrative Agent, The Chase
Manhattan Bank, as Documentation Agent, and the Lenders party
thereto (as the same may be amended, modified, extended or
restated from time to time, the "Credit Agreement")
DATE: _____________, 199__
-----------------------------------------------------------------
1. This Notice of Continuation/Conversion is made pursuant to the terms of
the Credit Agreement. All capitalized terms used herein unless
otherwise defined shall have the meanings set forth in the Credit
Agreement.
2. Please be advised that:
______ (a) the Borrower is requesting that a
portion of the current outstanding Revolving
Loans in the amount of $__________ currently
accruing interest at _________ be extended
or converted as of _____________ at the
interest rate option set forth in paragraph
3 below.
______ (b) the Borrower is requesting that a
portion of the outstanding Term Loans in the
amount of $__________ currently accruing
interest at ________ be extended or
converted as of ____________ at the interest
rate option set forth in paragraph 3 below.
2
3. The interest rate option applicable to the extension or conversion of
all or part of the existing Revolving Loans or Term Loans (as set forth
above) shall be:
a. ________ the Adjusted Base Rate
b. ________the Adjusted Eurodollar Rate for an Interest Period
of:
________ one month
________ two months
________ three months
________ six months
XXXXX, INC.
By:____________________________
Name:__________________________
Title:_________________________
Exhibit 2.6(a)
to
Amended and Restated
Credit Agreement
FORM OF
REVOLVING NOTE
Lender: ___________________ ______________, 1996
Principal Sum: $___________
FOR VALUE RECEIVED, Xxxxx, Inc., a Delaware corporation (the
"Borrower"), hereby promises to pay to the order of the Lender set forth above
(the "Lender"), at the office of NationsBank, N.A. (the "Administrative Agent")
as set forth in that certain Amended and Restated Credit Agreement dated as of
December ___, 1996 between the Borrower, T.K.G. Acquisition Corp., the Domestic
Subsidiaries of the Borrower, the Lenders named therein (including the Lender),
NationsBank, N.A., as Administrative Agent and The Chase Manhattan Bank, as
Documentation Agent (as modified and supplemented and in effect from time to
time, the "Credit Agreement"), the Principal Sum set forth above (or such lesser
amount as shall equal the aggregate unpaid principal amount of the Revolving
Loans made by the Lender to the Borrower under the Credit Agreement), in lawful
money of the United States of America and in immediately available funds, on the
dates and in the principal amounts provided in the Credit Agreement, and to pay
interest on the unpaid principal amount of each such Revolving Loan, at such
office, in like money and funds, for the period commencing on the date of such
Revolving Loan until such Revolving Loan shall be paid in full, at the rates per
annum and on the dates provided in the Credit Agreement.
This Note is one of the Revolving Notes referred to in the Credit
Agreement and evidences Revolving Loans made by the Lender thereunder.
Capitalized terms used in this Revolving Note and not otherwise defined shall
have the respective meanings assigned to them in the Credit Agreement and the
terms and conditions of the Credit Agreement are expressly incorporated herein
and made a part hereof.
The Credit Agreement provides for the acceleration of the maturity of
the Revolving Loans evidenced by this Revolving Note upon the occurrence of
certain events (and for payment of collection costs in connection therewith) and
for prepayments of Revolving Loans upon the terms and conditions specified
therein.
2
In the event this Revolving Note is not paid when due at any stated or
accelerated maturity, the Borrower agrees to pay, in addition to the principal
and interest, all costs of collection, including reasonable attorney fees.
The date, amount, type, interest rate and duration of Interest Period
(if applicable) of each Revolving Loan made by the Lender to the Borrower, and
each payment made on account of the principal thereof, shall be recorded by the
Lender on its books; provided that the failure of the Lender to make any such
recordation or endorsement shall not affect the obligations of the Borrower to
make a payment when due of any amount owing hereunder or under this Revolving
Note in respect of the Revolving Loans to be evidenced by this Revolving Note,
and each such recordation or endorsement shall be prima facie evidence of such
information.
This Note and the Revolving Loans evidenced hereby may be transferred
in whole or in part only by registration of such transfer on the Register
maintained for such purpose by or on behalf of the Borrower as provided in
Section 11.3(d) of the Credit Agreement.
THIS REVOLVING NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the Borrower has caused this Revolving Note to be
executed as of the date first above written.
XXXXX, INC.
By:_______________________________
Name:_____________________________
Title:____________________________
Exhibit 2.6(b)
to
Amended and Restated
Credit Agreement
FORM OF
TERM LOAN NOTE
Lender: ___________________ _____________, 1996
Principal Sum: $___________
FOR VALUE RECEIVED, Xxxxx, Inc., a Delaware corporation (the
"Borrower"), hereby promises to pay to the order of the Lender set forth above
(the "Lender") and its registered assigns, at the office of NationsBank, N.A.
(the "Administrative Agent") as set forth in that certain Amended and Restated
Credit Agreement dated as of December ___, 1996 among the Borrower, T.K.G.
Acquisition Corp., the Domestic Subsidiaries of the Borrower, the Lenders named
therein (including the Lender), NationsBank, N.A., as Administrative Agent and
The Chase Manhattan Bank, as Documentation Agent, (as modified and supplemented
and in effect from time to time, the "Credit Agreement"), the Principal Sum set
forth above (or such lesser amount as shall equal the aggregate unpaid principal
amount of the Term Loan made by the Lender to the Borrower under the Credit
Agreement), in lawful money of the United States of America and in immediately
available funds, on the dates and in the principal amounts provided in the
Credit Agreement, and to pay interest on the unpaid principal amount of such
Term Loan, at such office, in like money and funds, for the period commencing on
the date of such Term Loan until such Term Loan shall be paid in full, at the
rates per annum and on the dates provided in the Credit Agreement.
This Note is one of the Term Loan Notes referred to in the Credit
Agreement and evidences the Term Loan made by the Lender thereunder. Capitalized
terms used in this Term Loan Note and not otherwise defined shall have the
respective meanings assigned to them in the Credit Agreement and the terms and
conditions of the Credit Agreement are expressly incorporated herein and made a
part hereof.
The Credit Agreement provides for the acceleration of the maturity of
the Term Loan evidenced by this Term Loan Note upon the occurrence of certain
events (and for payment of collection costs in connection therewith) and for
prepayments of such Term Loan upon the terms and conditions specified therein.
In the event this Term Loan Note is not paid when due at any stated or
2
accelerated maturity, the Borrower agrees to pay, in addition to the principal
and interest, all costs of collection, including reasonable attorney fees.
The date, amount, type, interest rate and duration of Interest Period
(if applicable) of the Term Loan made by the Lender to the Borrower, and each
payment made on account of the principal thereof, shall be recorded by the
Lender on its books; provided that the failure of the Lender to make any such
recordation or endorsement shall not affect the obligations of the Borrower to
make a payment when due of any amount owing hereunder or under this Term Loan
Note in respect of the Term Loan to be evidenced by this Term Loan Note, and
each such recordation or endorsement shall be prima facie evidence of such
information.
This Note and the Term Loan evidenced hereby may be transferred in
whole or in part only by registration of such transfer on the Register
maintained for such purpose by or on behalf of the Borrower as provided in
Section 11.3(d) of the Credit Agreement.
THIS TERM LOAN NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, the Borrower has caused this Term Loan Note to be
executed as of the date first above written.
XXXXX, INC.
By:_______________________________
Name:_____________________________
Title:____________________________
Exhibit 7.1(c)
to
Amended and Restated
Credit Agreement
FORM OF OFFICER'S CERTIFICATE
For the fiscal quarter ended _________________, 19___.
I, ______________________, chief financial officer of Xxxxx, Inc. (the
"Borrower") hereby certify on behalf of the Borrower and not in my individual
capacity that, with respect to that certain Amended and Restated Credit
Agreement dated as of December ___, 1996 (as it may be amended, modified,
extended or restated from time to time, the "Credit Agreement"; all of the
defined terms in the Credit Agreement are incorporated herein by reference)
among the Borrower, the other Credit Parties party thereto, the Lenders party
thereto, NationsBank, N.A., as Administrative Agent and The Chase Manhattan
Bank, as Documentation Agent:
a. Attached hereto as Schedule 1 are calculations demonstrating
compliance by the Credit Parties with the financial covenants contained
in Section 7.12 of the Credit Agreement as of the end of the fiscal
period referred to above.
b. No dividends were paid or redemptions made during the fiscal period
referenced above or if any dividends were made or redemptions paid,
attached hereto as Schedule 2 is a description thereof and evidence of
compliance with the terms of Section 8.7 of the Credit Agreement, as
applicable, including calculations as necessary.
c. No principal payments, redemptions or deposits were made with
respect to Subordinated Debt during the fiscal period referenced above
or if any principal payments, redemption or deposits were made,
attached hereto as Schedule 3 is a description thereof and evidence of
compliance with the terms of Section 8.11 of the Credit Agreement, as
applicable, including calculations as necessary.
d. No Default or Event of Default has occurred under the Credit
Agreement(1).
----------------
1 If a Default or Event of Default shall have occurred an explanation of such
Default or Event of Default shall be provided on a separate page together with
an explanation of the action taken or proposed to be taken by the Credit Parties
with respect thereto.
2
e. The Borrower - prepared quarterly financial statements which
accompany this certificate fairly present in all material respects the
financial condition of the Borrower, the Parent and their Subsidiaries
and have been prepared in accordance with GAAP, subject to changes
resulting from normal year-end audit adjustments.
This ______ day of ___________, 19__.
XXXXX, INC.
-----------------------------
Chief Financial Officer
Exhibit 7.13
to
Amended and Restated
Credit Agreement
FORM OF JOINDER AGREEMENT
THIS JOINDER AGREEMENT (this "Agreement"), dated as of _____________,
199_, is entered into between _____________________, a ___________________ (the
"New Subsidiary") and NATIONSBANK, N.A., in its capacity as Administrative Agent
(the "Administrative Agent") under that certain Amended and Restated Credit
Agreement, dated as of December ___, 1996 among Xxxxx, Inc. (the "Borrower"),
T.K.G. Acquisition Corp., the Domestic Subsidiaries of the Borrower, the Lenders
party thereto, the Administrative Agent and The Chase Manhattan Bank as
Documentation Agent (as the same may be amended, modified, extended or restated
from time to time, the "Credit Agreement"). All capitalized terms used herein
and not otherwise defined shall have the meanings set forth in the Credit
Agreement.
The New Subsidiary and the Administrative Agent, for the benefit of the
Lenders, hereby agree as follows:
1. The New Subsidiary hereby acknowledges, agrees and confirms
that, by its execution of this Agreement, the New Subsidiary will be deemed to
be a Credit Party under the Credit Agreement and a "Guarantor" for all purposes
of the Credit Agreement and shall have all of the obligations of a Guarantor
thereunder as if it had executed the Credit Agreement. The New Subsidiary hereby
ratifies, as of the date hereof, and agrees to be bound by, all of the terms,
provisions and conditions contained in the Credit Agreement, including without
limitation (a) all of the representations and warranties of the Credit Parties
set forth in Section 6 of the Credit Agreement, (b) all of the affirmative and
negative covenants set forth in Sections 7 and 8 of the Credit Agreement and (c)
all of the guaranty obligations set forth in Section 4 of the Credit Agreement.
Without limiting the generality of the foregoing terms of this paragraph 1, the
New Subsidiary, subject to the limitations set forth in Section 4.7 of the
Credit Agreement, hereby guarantees, jointly and severally with the other
Guarantors, to the Agents and the Lenders, as provided in Section 4 of the
Credit Agreement, the prompt payment and performance of the Credit Party
Obligations in full when due (whether at stated maturity, as a mandatory
prepayment, by acceleration or otherwise) strictly in
2
accordance with the terms thereof and agrees that if any of the Credit
Party Obligations are not paid or performed in full when due (whether at stated
maturity, as a mandatory prepayment, by acceleration or otherwise), the New
Subsidiary will, jointly and severally together with the other Guarantors,
promptly pay and perform the same, without any demand or notice whatsoever, and
that in the case of any extension of time of payment or renewal of any of the
Credit Party Obligations, the same will be promptly paid in full when due
(whether at extended maturity, as a mandatory prepayment, by acceleration or
otherwise) in accordance with the terms of such extension or renewal.
2. If required, the New Subsidiary is, simultaneously with the
execution of this Agreement, executing and delivering such Collateral Documents
(and such other documents and instruments) as requested by the Administrative
Agent in accordance with Section 7.13 of the Credit Agreement.
3. The address of the New Subsidiary for purposes of Section
11.1 of the Credit Agreement is as follows:
------------------------------
------------------------------
4. The New Subsidiary hereby waives acceptance by the Agents
and the Lenders of the guaranty by the New Subsidiary under the Credit Agreement
upon the execution of this Agreement by the New Subsidiary.
5. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall constitute one and the same instrument.
6. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
3
IN WITNESS WHEREOF, the New Subsidiary has caused this Agreement to be
duly executed by its authorized officer, and the Administrative Agent, for the
benefit of the Lenders, has caused the same to be accepted by its authorized
officer, as of the day and year first above written.
[NEW SUBSIDIARY]
By:___________________________
Name:_________________________
Title:________________________
Acknowledged and accepted:
NATIONSBANK, N.A., as Administrative Agent
By:_____________________________
Name:___________________________
Title:__________________________
Exhibit 11.3
to
Amended and Restated
Credit Agreement
FORM OF
ASSIGNMENT AGREEMENT
Reference is made to that certain Amended and Restated Credit Agreement
dated as of December ___, 1996 (as the same may be amended, modified, extended
or restated from time to time, the "Credit Agreement") among Xxxxx, Inc. (the
"Borrower"), T.K.G. Acquisition Corp., (the "Parent") the Domestic Subsidiaries
of the Borrower, the Lenders identified therein, NationsBank, N.A., as
Administrative Agent and The Chase Manhattan Bank, as Documentation Agent. All
capitalized terms used herein and not otherwise defined shall have the meanings
set forth in the Agreement.
1. The Assignor (as defined below) hereby sells and assigns, without
recourse, to the Assignee (as defined below), and the Assignee hereby purchases
and assumes, without recourse, from the Assignor, effective as of effective date
of the assignment as designated below (the "Effective Date"), the interests set
forth below (the "Assigned Interest") in the Assignor's rights and obligations
under the Credit Agreement, including, without limitation, (a) the interests set
forth below in the Revolving Loan Commitment Percentage and the Term Loan
Commitment Percentage of the Assignor on the Effective Date, (b) the Loans owing
to the Assignor in connection with the Assigned Interest which are outstanding
on the Effective Date, and (c) the Assignor's participation interests in all
Letters of Credit as of the Effective Date and the rights and obligations
appurtenant thereto under the LOC Documents. The purchase of the Assigned
Interest shall be at par and periodic payments made with respect to the Assigned
Interest which (i) accrued prior to the Effective Date shall be remitted to the
Assignor and (ii) accrue from and after the Effective Date shall be remitted to
the Assignee. From and after the Effective Date, the Assignee, if it is not
already a Lender under the Credit Agreement, shall become a "Lender" for all
purposes of the Credit Agreement and the other Credit Documents and, to the
extent of such assignment, the assigning Lender shall be relieved of its
obligations under the Credit Agreement.
2. The Assignor represents and warrants to the Assignee that it
is the holder of the Assigned Interest, and the Loans and
2
Participation Interests related thereto, and it has not previously transferred
or encumbered such Assigned Interest, Loans or Participation Interests.
3. The Assignee represents and warrants to the Assignor that it
is an Eligible Assignee.
4. This Assignment shall be effective only upon (a) the consent of the
Borrower and the Administrative Agent to the extent required under Section
11.3(b) of the Credit Agreement and (b) delivery to the Administrative Agent of
this Assignment Agreement together with the transfer fees, if applicable, set
forth in Section 11.3(b) of the Credit Agreement.
5. The Assignor and the Assignee confirm to and agree with each other
and the other parties to the Credit Agreement as to the terms set forth in
paragraph 2 of Section 11.3(b) of the Credit Agreement.
6. This Assignment shall be governed by and construed in
accordance with the laws of the State of New York.
7. Terms of Assignment
(a) Date of Assignment __________________
(b) Legal Name of Assignor __________________
(c) Legal Name of Assignee __________________
(d) Effective Date of Assignment __________________
(e) Revolving Loan Commitment
Percentage assigned _________________%
(f) Total Revolving Loans
outstanding as of Effective Date $______________
(g) Principal Amount of Revolving
Loans assigned on Effective
Date (the amount set forth
in (f) multiplied by the
percentage set forth in (e)) $______________
(h) Revolving Committed Amount $______________
(i) Principal Amount of Revolving
Committed Amount Assigned on
3
the Effective Date (the amount
set forth in (h) multiplied by
the percentage set forth in (e)) $______________
(j) Term Loan Commitment
Percentage assigned _____________%
4
(k) Total Term Loans outstanding
as of Effective Date $______________
(l) Principal Amount of Term
Loans assigned on Effective
Date (the amount set forth
in (k) multiplied by the
percentage set forth in (j)) $______________
The terms set forth above are hereby agreed to:
_______________________, as Assignor
By:______________________________
Name:____________________________
Title:___________________________
____________________, as Assignee
By:______________________________
Name:____________________________
Title:___________________________
CONSENTED TO (if applicable):
XXXXX, INC.
By:__________________________
Name:________________________
Title:_______________________
NATIONSBANK, N.A., as
Administrative Agent
By:___________________________
Name:_________________________
Title:________________________
