$40,000,000 REVOLVING CREDIT FACILITY
REVOLVING CREDIT AGREEMENT
by and among
XX XXXX'X INCORPORATED
and
PLANT ENGINEERING CONSULTANTS, INC.
and
GRUPO BLAJU, S.A., de C.V.
and
XX XXXX'X CANADA, LTD.
and
THE BANKS PARTY HERETO
and
PNC BANK, NATIONAL ASSOCIATION, as Agent
Dated as of October 10, 1996
TABLE OF CONTENTS
Section Page
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1. CERTAIN DEFINITIONS ........................................................1
1.1 Certain Definitions ..................................................1
1.2 Construction ........................................................16
1.2.1 Number; Inclusion ................................................16
1.2.2 Determination ....................................................16
1.2.3 Agent's Discretion and Consent ...................................17
1.2.4 Documents Taken as a Whole .......................................17
1.2.5 Headings .........................................................17
1.2.6 Implied References to this Agreement .............................17
1.2.7 Persons ..........................................................17
1.2.8 Modifications to Documents .......................................17
1.2.9 From, To and Through .............................................17
1.2.10 Shall; Will ......................................................18
1.3 Accounting Principles ...............................................18
2. REVOLVING CREDIT FACILITY .................................................18
2.1 Commitments .........................................................18
2.1.1 Loans ............................................................18
2.1.2 Voluntary Reduction of Commitment ................................18
2.2 Nature of Banks' Obligations with Respect to Loans ..................19
2.3 Commitment Fees .....................................................19
2.4 Revolving Credit Facility Fee .......................................20
2.5 Loan Requests .......................................................20
2.6 Making Loans ........................................................20
2.7 Notes ...............................................................21
2.8 Use of Proceeds .....................................................21
2.9 Letter of Credit Subfacility ........................................21
2.9.1 Issuance of Letters of Credit ....................................21
2.9.2 Letter of Credit Fees ............................................22
2.9.3 Disbursements, Reimbursement .....................................22
2.9.4 Repayment of Participation Advances ..............................23
2.9.5 Documentation ....................................................23
2.9.6 Determinations to Honor Drawing Requests .........................24
2.9.7 Nature of Participation and Reimbursement Obligations ............24
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2.9.8 Indemnity .......................................................25
2.9.9 Liability for Acts and Omissions ................................26
2.10 Extension by Banks of the Expiration Date ...........................26
2.10.1 Requests; Approval by All Banks ................................26
2.10.2 Approval by Required Banks .....................................27
3. [RESERVED] ................................................................27
4. INTEREST RATES ............................................................27
4.1 Interest Rate Options ...............................................27
4.1.1 Revolving Credit Interest Rate Options ..........................27
4.1.2 Rate Quotations .................................................28
4.2 Interest Periods ....................................................29
4.2.1 Ending Date and Business Day ....................................29
4.2.2 Amount of Borrowing Tranche .....................................29
4.2.3 Termination Before Expiration Date ..............................29
4.2.4 Renewals ........................................................29
4.3 Interest After Default ..............................................29
4.3.1 Letter of Credit Fees, Interest Rate ............................29
4.3.2 Other Obligations ...............................................30
4.3.3 Acknowledgment ..................................................30
4.4 Euro-Rate Unascertainable; Illegality; Increased Costs;
Deposits Not Available 30 4.4.1 Unascertainable .....................30
4.4.2 Illegality; Increased Costs; Deposits Not Available .............30
4.4.3 Agent's and Bank's Rights .......................................31
4.4.4 Uniform Application .............................................31
4.5 Selection of Interest Rate Options ..................................31
5. PAYMENTS ..................................................................32
5.1 Payments ............................................................32
5.2 Pro Rata Treatment of Banks .........................................32
5.3 Interest Payment Dates ..............................................32
5.4 Voluntary Prepayments ...............................................33
5.4.1 Right to Prepay .................................................33
5.4.2 Change of Lending Office ........................................34
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5.5 [RESERVED] ..........................................................34
5.6 Additional Compensation in Certain Circumstances ....................34
5.6.1 Increased Costs or Reduced Return Resulting From Taxes,
Reserves, Capital Adequacy Requirements, Expenses, Etc. .........34
5.6.2 Indemnity .......................................................35
5.7 Special Provisions Concerning Foreign Borrowers .....................36
6. REPRESENTATIONS AND WARRANTIES ............................................36
6.1 Representations and Warranties ......................................36
6.1.1 Organization and Qualification ..................................36
6.1.2 Capitalization and Ownership ....................................36
6.1.3 Subsidiaries ....................................................36
6.1.4 Power and Authority .............................................37
6.1.5 Validity and Binding Effect .....................................37
6.1.6 No Conflict .....................................................37
6.1.7 Litigation ......................................................38
6.1.8 Title to Properties .............................................38
6.1.9 Financial Statements ............................................38
6.1 10 Use of Proceeds; Margin Stock ...................................39
6.1.11 Full Disclosure .................................................39
6.1.12 Taxes ...........................................................39
6.1.13 Consents and Approvals ..........................................40
6.1.14 No Event of Default; Compliance with Instruments ................40
6.1.15 Patents, Trademarks, Copyrights, Licenses, Etc. .................40
6.1.16 Insurance .......................................................40
6.1.17 -Compliance with Laws ...........................................40
6.1.18 Material Contracts; Burdensome Restrictions .....................41
6.1.19 Investment Companies; Regulated Entities ........................41
6.1.20 Plans and Benefit Arrangements ..................................41
6.1.21 Employment Matters ..............................................42
6.1.22 Environmental Matters ...........................................43
6.1.23 Senior Debt Status ..............................................44
7. CONDITIONS OF LENDING .....................................................44
7.1 First Loans .........................................................44
7.1.1 Officer's Certificate ...........................................44
7.1.2 Secretary's Certificate .........................................45
7.1.3 Delivery of Loan Documents ......................................45
7.1.4 Opinion of Counsel ..............................................45
7.1.5 Legal Details ...................................................45
7.1.6 Payment of Fees .................................................46
7.1.7 Lien Searches and Fleet Payoff ..................................46
7.1.8 [RESERVED] ......................................................46
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7.1.9 Consents ........................................................46
7.1.10 Officer's Certificate Regarding MACs ............................46
7.1.11 No Violation of Laws ............................................46
7.1.12 No Actions or Proceedings .......................................46
7.1.13 Insurance Policies; Certificates of Insurance; Endorsements .....47
7.2 Each Additional Loan ................................................47
8. COVENANTS .................................................................47
8.1 Affirmative Covenants ...............................................47
8.1.1 Preservation of Existence, Etc. .................................47
8.1.2 Payment of Liabilities, Including Taxes, Etc. ...................48
8.1.3 Maintenance of Insurance ........................................48
8.1.4 Maintenance of Properties and Leases ............................48
8.1.5 Maintenance of Patents, Trademarks, Etc. ........................48
8.1.6 Visitation Rights ...............................................49
8.1.7 Keeping of Records and Books of Account .........................49
8.1.8 Plans and Benefit Arrangements ..................................49
8.1.9 Compliance with Laws ............................................49
8.1.10 Use of Proceeds .................................................50
8.1.11 Further Assurances ..............................................50
8.1.12 Subordination of Intercompany Loans .............................50
8.2 Negative Covenants ..................................................50
8.2.1 Indebtedness .....................................................51
8.2.2 Liens ............................................................51
8.2.3 Guaranties .......................................................51
8.2.4 Loans and Investments ............................................52
8.2.5 Dividends and Related Distributions ..............................52
8.2.6 Liquidations, Mergers, Consolidations, Acquisitions ..............53
8.2.7 Dispositions of Assets or Subsidiaries ...........................54
8.2.8 Affiliate Transactions ...........................................55
8.2.9 Subsidiaries, Partnerships and Joint Ventures ....................55
8.2.10 Continuation of or Change in Business ...........................55
8.2.11 Plans and Benefit Arrangements ..................................55
8.2.12 Fiscal Year .....................................................56
8.2.13 Issuance of Stock ...............................................56
8.2.14 Changes in Organizational Documents .............................57
8.2.15 Capital Expenditures and Leases .................................57
8.2.16 Minimum Interest Coverage Ratio .................................57
8.2.17 Minimum Tangible Net Worth ......................................57
8.2.18 Maximum Leverage Ratio ..........................................58
8.2.19 Operating Assets; Acquisitions ..................................58
8.2.20 Outside Investment Limit ........................................58
8.3 Reporting Requirements ..............................................58
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8.3.1 [RESERVED] ......................................................58
8.3.2 Quarterly Financial Statements ..................................58
8.3.3 Annual Financial Statements .....................................58
8.3.4 Certificate of the Borrower .....................................59
8.3.5 Notice of Default ...............................................59
8.3.6 Notice of Litigation ............................................59
8.3.7 Certain Events ..................................................59
8.3.8 Budgets, Forecasts, Other Reports and Information ...............60
8.3.9 Notices Regarding Plans and Benefit Arrangements ................60
8.3.10 Material Venture Investments ....................................62
9. DEFAULT ...................................................................62
9.1 Events of Default ...................................................62
9.1.1 Payments Under Loan Documents ...................................62
9.1.2 Breach of Warranty ..............................................62
9.1.3 Breach of Negative Covenants or Visitation Rights ...............63
9.1.4 Breach of Other Covenants .......................................63
9.1.5 Defaults in Other Agreements or Indebtedness ....................63
9.1.6 Final Judgments or Orders .......................................63
9.1.7 Loan Document Unenforceable .....................................63
9.1.8 Uninsured Losses; Proceedings Against Assets ....................64
9.1.9 Notice of Lien or Assessment ....................................64
9.1.10 Insolvency ......................................................64
9.1.11 Events Relating to Plans and Benefit Arrangements ...............64
9.1.12 Cessation of Business ...........................................65
9.1.13 Change of Control ...............................................65
9.1.14 Involuntary Proceedings .........................................65
9.1.15 Voluntary Proceedings ...........................................65
9.2 Consequences of Event of Default ....................................66
9.2.1 Events of Default Other Than Bankruptcy, Insolvency or
Reorganization Proceedings ......................................66
9.2.2 Bankruptcy, Insolvency or Reorganization Proceedings ............66
9.2.3 Set-off .........................................................66
9.2.4 Suits, Actions, Proceedings .....................................67
9.2.5 Application of Proceeds .........................................67
9.2.6 Other Rights and Remedies .......................................68
10. THE AGENT ................................................................68
10.1 Appointment ........................................................68
10.2 Delegation of Duties ...............................................68
10.3 Nature of Duties; Independent Credit Investigation .................68
10.4 Actions in Discretion of Agent; Instructions from the Banks ........69
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10.5 Reimbursement and Indemnification of Agent by the Borrower .........69
10.6 Exculpatory Provisions; Limitation of Liability ....................70
10.7 Reimbursement and Indemnification of Agent by Banks ................71
10.8 Reliance by Agent ..................................................71
10.9 Notice of Default ..................................................71
10.10 Notices ...........................................................71
10.11 Banks in Their Individual Capacities ..............................72
10.12 Holders of Notes ..................................................72
10.13 Equalization of Banks .............................................72
10.14 Successor Agent ...................................................73
10.15 Agent's Fee .......................................................73
10.16 Availability of Funds .............................................73
10.17 Calculations ......................................................74
10.18 Beneficiaries .....................................................74
11. MISCELLANEOUS ............................................................74
11.1 Modifications, Amendments or Waivers ...............................74
11.1.1 Increase of Commitment; Extension or Expiration Date ...........74
11.1.2 Extension of Payment; Reduction of Principal Interest or
Fees; Modification of Terms of Payment. ........................74
11.1.3 Release of Guarantor ...........................................75
11.1.4 Miscellaneous ..................................................75
11.2 No Implied Waivers; Cumulative Remedies; Writing Required ..........75
11.3 Reimbursement and Indemnification of Banks by the Borrower; Taxes 75
11.4 Holidays ...........................................................76
11.5 Funding by Branch, Subsidiary or Affiliate .........................77
11.5.1 Notional Funding ...............................................77
11.5.2 Actual Funding .................................................77
11.6 Notices ............................................................77
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11.7 Severability .......................................................78
11.8 Governing Law ......................................................78
11.9 Prior Understanding ................................................78
11.10 Duration; Survival ................................................78
11.11 Successors and Assigns ............................................79
11.12 Confidentiality ...................................................80
11.13 Counterparts ......................................................80
11.14 Agent's or Bank's Consent .........................................80
11.15 Exceptions ........................................................80
11.16 CONSENT TO FORUM; WAIVER OF JURY TRIAL ............................81
11.17 Tax Withholding Clause ............................................81
11.18 Joinder of Borrowers ..............................................82
vii
LIST OF SCHEDULES AND EXHIBITS
SCHEDULE
SCHEDULE 1.1(B) - COMMITMENTS OF BANKS AND ADDRESSES FOR
NOTICES
SCHEDULE 1.1(P) - PERMITTED LIENS
SCHEDULE 6.1.1 - QUALIFICATIONS TO DO BUSINESS
SCHEDULE 6.1.2 - CAPITALIZATION
SCHEDULE 6.1.3 - BORROWERS/SUBSIDIARIES EXCEPTIONS
SCHEDULE 6.1.16 - INSURANCE POLICIES
SCHEDULE 6.1.20 - EMPLOYEE BENEFIT PLAN DISCLOSURES
SCHEDULE 6.1.22 - ENVIRONMENTAL DISCLOSURES
SCHEDULE 8.2.1 - PERMITTED INDEBTEDNESS
EXHIBITS
EXHIBIT 1.1(A) - ASSIGNMENT AND ASSUMPTION AGREEMENT
EXHIBIT 1.1(B) - BORROWER AGENCY AGREEMENT
EXHIBIT 1.1(C) - COLLATERAL ASSIGNMENT
EXHIBIT 1.1 (J) - JOINDER
EXHIBIT 1.1(G) - GUARANTY AGREEMENT
EXHIBIT 1.1(1) - INTERCOMPANY SUBORDINATION AGREEMENT
EXHIBIT 1.1(R) - NOTE
EXHIBIT 2.5 - LOAN REQUEST
EXHIBIT 8.2.6 - ACQUISITION COMPLIANCE CERTIFICATE
EXHIBIT 8.3.4 - QUARTERLY COMPLIANCE CERTIFICATE
viii
REVOLVING CREDIT AGREEMENT
THIS REVOLVING CREDIT AGREEMENT is dated as of October 10, 1996 and is made
by and among XX XXXX'X INCORPORATED, a Pennsylvania corporation (the "Company")
and PLANT ENGINEERING CONSULTANTS, INC., a Tennessee corporation, GRUPO BLAJU,
S.A., de C.V., a Mexican corporation and XX XXXX'X CANADA, LTD., an Ontario
corporation (such Persons, together with the Company, being the "Borrowers" and
each being a "Borrower"), XX XXXX'X CORPORATION, a Delaware corporation, as
Guarantor, the BANKS (as hereinafter defined), and PNC BANK, NATIONAL
ASSOCIATION, in its capacity as agent for the Banks under this Agreement
(hereinafter referred to in such capacity as the "Agent").
WITNESSETH:
WHEREAS, the Borrowers have requested the Banks to provide revolving credit
facility to the Borrowers in an aggregate principal amount not to exceed
$40,000,000 including a sublimit for approved letters of credit not to exceed
$5,000,000; and
WHEREAS, the revolving credit shall be used to refinance existing secured
indebtedness and for general corporate purposes, including permitted
acquisitions; and
WHEREAS, the Banks are willing to provide such credit upon the terms and
conditions hereinafter set forth;
NOW, THEREFORE, the parties hereto, in consideration of their mutual
covenants and agreements hereinafter set forth and intending to be legally bound
hereby, covenant and agree as follows:
1. CERTAIN DEFINITIONS
1.1 Certain Definitions.
In addition to words and terms defined elsewhere in this Agreement, the
following words and terms shall have the following meanings, respectively,
unless the context hereof clearly requires otherwise:
Affiliate as to any Person shall mean any other Person (i) which directly
or indirectly controls, is controlled by, or is under common control with such
Person, (ii) which beneficially owns or holds 5% or more of any class of the
voting or other equity interests of such Person, or (iii) 5% or more of any
class of voting interests or other equity interests of which is beneficially
owned or held, directly or indirectly, by such Person. Control, as used in this
definition, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ownership of voting
securities, by contract or otherwise, including the power to elect a majority of
the directors or trustees of a corporation or trust, as the case may be.
Agent shall mean PNC Bank, National Association, and its successors and
assigns.
Agent's Fees shall have the meaning assigned to that term in Section 10.15.
Agent's Letter shall have the meaning assigned to that term in Section
10.15.
Agreement shall mean this Revolving Credit Agreement, as the same may be
supplemented or amended from time to time, including all schedules and exhibits.
Annual Statements shall have the meaning assigned to that term in Section
6.1.9(i).
Applicable Margin shall have the meaning assigned to that term in Section
4.1.1.
Assignee Bank shall have the meaning assigned to such term in Section
2.10.2.
Assignment and Assumption Agreement shall mean an Assignment and Assumption
Agreement by and among a Purchasing Bank, a Transferor Bank and the Agent, as
Agent and on behalf of the remaining Banks, substantially in the form of Exhibit
1.1(A).
Authorized Officer shall mean those individuals, designated by written
notice to the Agent from the Borrowers, authorized to execute notices, reports
and other documents on behalf of the Loan Parties required hereunder. The
Borrower may amend such list of individuals from time to time by giving written
notice of such amendment to the Agent.
Bank to be Terminated shall have the meaning assigned to such term in
Section 2.10.2.
Banks shall mean the financial institutions named on Schedule 1.1 (B) and
their respective successors and assigns as permitted hereunder, each of which is
referred to herein as a Bank.
Base Rate shall mean the greater of (i) the interest rate per annum
announced from time to time by the Agent at its Principal Office as its then
prime rate, which rate may not be the lowest rate then being charged commercial
borrowers by the Agent, or (ii) the Federal Funds Effective Rate plus 1/2 % per
annum.
2
Base Rate Option shall mean the option of the Borrower to have Loans bear
interest at the rate and under the terms and conditions set forth in Section 4.
1.1 (i).
Benefit Arrangement shall mean an "employee benefit plan," within the
meaning of Section 3(3) of ERISA, which is neither a Plan, a Multiple Employer
Plan nor a Multiemployer Plan and which is maintained, sponsored or otherwise
contributed to by any member of the ERISA Group.
Borrower shall mean any of the Company, Plant Engineering Consultants,
Inc., a Tennessee corporation, Grupo Blaju, S.A., de C.V., a Mexican corporation
and XX Xxxx'x Canada, Ltd., an Ontario corporation and Borrowers shall mean all
of such Persons together.
Borrower Agency Agreement shall mean that certain agreement among the
Borrowers, substantially in the form of Exhibit 1.1 (B) hereto, pursuant to
which the Borrowers authorize and appoint the Company to act on behalf of the
Borrowers to take any and all actions that may be required to be taken by any
Borrower or the Borrowers hereunder, including, without limitation, making
requests for and borrowing any Loan.
Borrowing Date shall mean, with respect to any Loan, the date for the
making thereof or the renewal or conversion thereof at or to the same or a
different Interest Rate Option, which shall be a Business Day.
Borrowing Tranche shall mean specified portions of Loans outstanding as
follows: (i) any Loans to which a Euro-Rate Option applies which become subject
to the same Interest Rate Option under the same Loan Request by the Borrower and
which have the same Interest Period shall constitute one Borrowing Tranche, and
(ii) all Loans to which a Base Rate Option applies shall constitute one
Borrowing Tranche.
Business Day shall mean any day other than a Saturday or Sunday or a legal
holiday on which commercial banks are authorized or required to be closed for
business in Camp Hill, Pennsylvania.
Closing Date shall mean the Business Day on which the first Loan shall be
made, which shall be the date hereof. The closing shall take place at 10:30 a.m.
on the Closing Date at the offices of Xxxxxxxx Xxxxxxxxx Professional
Corporation in Philadelphia, Pennsylvania or at such other time and place as the
parties agree.
Closing Fees shall mean the fees referred to in Sections 2.4.
Commercial Letter of Credit shall mean any Letter of Credit which is a
commercial letter of credit issued in respect of the purchase of goods or
services by one or more of the Borrowers in the ordinary course of their
business.
3
Commitment shall mean, as to any Bank at any time, the amount initially set
forth opposite its name on Schedule 1.1(B) in the column labeled "Amount of
Commitment for Loans," and thereafter on Schedule I to the most recent
Assignment and Assumption Agreement, and Commitments shall mean the aggregate
Commitments of all of the Banks.
Commitment Fee shall have the meaning assigned to that term in Section 2.3.
Commitment Fee Applicable Margin shall have the meaning assigned to that
term in Section 2.3.
Company shall mean XX Xxxx'x Incorporated, a Pennsylvania corporation.
Consideration shall mean with respect to any Permitted Acquisition, the
aggregate of (i) the cash paid by any of the Parent, directly or indirectly, to
the seller in connection therewith, (ii) the Indebtedness incurred or assumed by
any of the Loan Parties, whether in favor of the seller or otherwise and whether
fixed or contingent, (iii) any Guaranty given or incurred by any Loan Party in
connection therewith, and (iv) any other consideration given or obligation
incurred by any of the Loan Parties in connection therewith.
Consolidated Tangible Net Worth shall mean as of any date of determination
total stockholders' equity of the Parent less intangible assets of the Parent as
of such date determined and consolidated in accordance with GAAP.
Dollar, Dollars, U.S. Dollars and the symbol $ shall mean lawful money of
the United States of America.
Domestic shall mean, when used with reference to a Borrower or a
Subsidiary, a Borrower or Subsidiary organized under the laws of, and conducting
operations in, the United States of America, a state thereof, the District of
Columbia, Puerto Rico or the United States Virgin Islands.
Drawing, Date shall have the meaning assigned to that ten-n in Section
2.9.3.2.
EBIT shall mean net income before extraordinary items, interest expense and
income tax expense calculated in respect of the prior four (4) consecutive
fiscal quarters in each case of the Parent on a consolidated basis and
determined and consolidated in accordance with GAAP and (x) shall be calculated
to include the operation of any business acquired in a Permitted Acquisition if
either (1) the Borrower provides to the Banks audited financial statements of
such business, and such business ( if it is a legal entity) becomes a Loan Party
contemporaneously with such Permitted Acquisitions or (2) Required Banks have
consented to such inclusions and (y) shall be calculated to exclude any portion
of the net earnings of any Subsidiary which is not a Borrower or that, by reason
of any contract or charter restriction or
4
applicable law or regulation, is unavailable for payment of dividends to any
Loan Party or any portion of the net earnings of any Loan Party that cannot
freely be converted into Dollars in the ordinary course of business.
EBITDA shall mean net income before extraordinary items, depreciation,
amortization, interest expense and income tax expense calculated in respect of
the prior four (4) consecutive fiscal quarters in each case of the Parent on a
consolidated basis and determined and consolidated in accordance with GAAP and
(x) shall be calculated to include the operation of any business acquired in a
Permitted Acquisition if either (1) the Borrower provides to the Banks audited
financial statements of such business, and such business (if it is a legal
entity) becomes a Loan Party contemporaneously with such Permitted Acquisition
or (2) Required Banks have consented to such inclusions and (y) shall be
calculated to exclude any portion of the net earnings of any Subsidiary that is
not a Borrower or that, by reason of any contract or charter restriction or
applicable law or regulation, is unavailable for payment of dividends to any
Loan Party or any portion of the net earnings of any Loan Party that cannot
freely be converted into Dollars in the ordinary course of business.
Environmental Complaint shall mean any written complaint setting forth a
cause of action for personal injury or property damage or natural resource
damage or equitable relief, order, notice of violation, citation, request for
information issued pursuant to any Environmental Laws by an Official Body,
subpoena or other written notice of any type relating to, arising out of, or
issued pursuant to, any of the Environmental Laws or any Environmental
Conditions, as the case may be.
Environmental Conditions shall mean any conditions of the environment,
including the workplace, the ocean, natural resources (including flora or
fauna), soil, surface water, groundwater, any actual or potential drinking water
supply sources, substrata or the ambient air, relating to or arising out of, or
caused by, the use, handling, storage, treatment, recycling, generation,
transportation release, spilling, leaking, pumping, emptying, discharging,
injecting, escaping, leaching, disposal, dumping, threatened release or other
management or mismanagement of Regulated Substances resulting from the use of,
or operations on, any Property.
Environmental Laws shall mean all applicable federal, state, local and
foreign Laws and regulations, including pen-nits, licenses, authorizations,
bonds, orders, judgments, and consent decrees issued, or entered into, pursuant
thereto, relating to pollution or protection of human health or the environment
or employee safety in the workplace.
ERISA shall mean the Employee Retirement Income Security Act of 1974, as
the same may be amended or supplemented from time to time, and any successor
statute of similar import, and the rules and regulations thereunder, as from
time to time in effect.
ERISA Group shall mean the Loan Parties and all members of a controlled
group of corporations and all trades or businesses (whether or not incorporated)
under common
5
control and all other entities which, together with the Loan Parties, are
treated as a single employer under Section 414 of the Internal Revenue Code.
Euro-Rate shall mean, with respect to the Loans comprising any Borrowing
Tranche to which the Euro-Rate Option applies for any Interest Period, the
interest rate per annum determined by the Agent by dividing (the resulting
quotient rounded upward to the nearest 1/100th of 1% per annum) (i) the rate of
interest determined by the Agent in accordance with its usual procedures (which
determination shall be conclusive absent manifest error) to be the London
interbank offered rate of interest per annum appearing on Telerate display page
3750 or such other display page on the Telerate System as may replace such page
(or appropriate successor or, if the British Bankers' Association or its
successor ceases to provide such quotes, a comparable replacement determined by
the Agent) at approximately 11:00 a.m., London time, two (2) Business Days prior
to the first day of such Interest Period for an amount comparable to such
Borrowing Tranche and having a borrowing date and a maturity comparable to such
Interest Period by (ii) a number equal to 1.00 minus the Euro-Rate Reserve
Percentage. The Euro-Rate may also be expressed by the following formula:
Euro-Rate = Telerate page 3750 quoted by British Bankers'
Association or appropriate successor
1.00 - Euro-Rate Reserve Percentage
The Euro-Rate shall be adjusted with respect to any Euro-Rate Option outstanding
on the effective date of any change in the Euro-Rate Reserve Percentage as of
such effective date. The Agent shall give prompt notice to the Borrower of the
Euro-Rate as determined or adjusted in accordance herewith, which determination
shall be conclusive absent manifest error.
Euro-Rate Option shall mean the option of the Borrower to have Loans bear
interest at the rate and under the terms and conditions set forth in Section 4.
1.1 (ii).
Euro-Rate Reserve Percentage shall mean the maximum percentage (expressed
as a decimal rounded upward to the nearest 1/100 of 1%) as determined by the
Agent which is in effect during any relevant period, as prescribed by the Board
of Governors of the Federal Reserve System (or any successor) for determining
the reserve requirements (including supplemental, marginal and emergency reserve
requirements) with respect to eurocurrency funding (currently referred to as
"Eurocurrency Liabilities") of a member bank in such System.
Event of Default shall mean any of the events described in Section 9.1 and
referred to therein as an "Event of Default."
Expiration Date shall mean, with respect to the Commitments, October 10,
2001, as such date may be extended in accordance with Section 2. 10.
Extending Bank shall have the meaning assigned to such term in Section
2.10.2.
6
Federal Funds Effective Rate for any day shall mean the rate per annum
(based on a year of 360 days and actual days elapsed and rounded upward to the
nearest 1/100 of 1%) announced by the Federal Reserve Bank of New York (or any
successor) on such day as being the weighted average of the rates on overnight
federal funds transactions arranged by federal funds brokers on the previous
trading day, as computed and announced by such Federal Reserve Bank (or any
successor) in substantially the same manner as such Federal Reserve Bank
computes and announces the weighted average it refers to as the "Federal Funds
Effective Rate" as of the date of this Agreement; provided, if such Federal
Reserve Bank (or its successor) does not announce such rate on any day, the
"Federal Funds Effective Rate" for such day shall be the Federal Funds Effective
Rate for the last day on which such rate was announced.
Financial Projections shall have the meaning assigned to that term in
Section 6.1.9(ii).
Foreign shall mean, when used with reference to a Borrower or a Subsidiary,
a Borrower or Subsidiary that is not a Domestic Borrower or a Domestic
Subsidiary.
GAAP shall mean generally accepted accounting principles as are in effect
from time to time, subject to the provisions of Section 1.3, and applied on a
consistent basis both as to classification of items and amounts.
Governmental Acts shall have the meaning assigned to that term in Section
2.9.8.
Guarantor shall mean the Parent and each of the parties to this Agreement
which may after the Closing Date be designated as a "Guarantor".
Guaranty of any Person shall mean any obligation of such Person
guaranteeing or in effect guaranteeing any liability or obligation of any other
Person in any manner, whether directly or indirectly, including any agreement to
indemnify or hold harmless any other Person, any performance bond or other
suretyship arrangement and any other form of assurance against loss, except
endorsement of negotiable or other instruments for deposit or collection in the
ordinary course of business.
Guaranty Agreement shall mean the Guaranty and Suretyship Agreement in
substantially the form of Exhibit 1.1(G) executed and delivered by the Guarantor
to the Agent for the benefit of the Banks.
Historical Statements shall have the meaning assigned to that term in
Section 6.1.9(i).
Indebtedness shall mean, as to any Person at any time, any and all
indebtedness, obligations or liabilities (whether matured or unmatured,
liquidated or unliquidated, direct or indirect, absolute or contingent, or joint
or several) of such Person for or in respect of.- (i) borrowed money, (ii)
amounts raised under or liabilities in respect of any note
7
purchase or acceptance credit facility, (iii) reimbursement obligations
(contingent or otherwise) under any letter of credit, (iv) any other transaction
(including forward sale or purchase agreements, capitalized leases and
conditional sales agreements) having the commercial effect of a borrowing of
money entered into by such Person to finance its operations or capital
requirements (but not including trade payables and accrued expenses incurred in
the ordinary course of business which are not represented by a promissory note
or other evidence of indebtedness), or (v) any Guaranty of Indebtedness for
borrowed money.
Ineligible Security shall mean any security which may not be underwritten
or dealt in by member banks of the Federal Reserve System under Section 16 of
the Banking Act of 1933 (12 U.S.C. Section 24, Seventh), as amended.
Insolvency Proceeding shall mean, with respect to any Person, (a) case,
action or proceeding with respect to such Person (i) before any court or any
other Official Body under any bankruptcy, insolvency, reorganization or other
similar Law now or hereafter in effect, or (ii) for the appointment of a
receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator
(or similar official) of any Loan Party or otherwise relating to liquidation,
dissolution, winding-up or relief of such Person, or (b) any general assignment
for the benefit of creditors, composition, marshaling of assets for creditors,
or other, similar arrangement in respect of such Person's creditors generally or
any substantial portion of its creditors undertaken under any Law.
Intercompany Subordination Agreement shall mean a Subordination Agreement
among the Loan Parties in the form attached hereto as Exhibit 1.1 (1).
Interest Period shall have the meaning assigned to such term in Section
4.2.
Interest Rate Option shall mean any Euro-Rate Option or Base Rate Option.
Interim Statements shall have the meaning assigned to that term in Section
6.1.9(i).
Internal Revenue Code shall mean the Internal Revenue Code of 1986, as the
same may be amended or supplemented from time to time, and any successor statute
of similar import, and the rules and regulations thereunder, as from time to
time in effect.
Joinder shall mean a joinder by a Person as a Borrower under this Agreement
and the other Loan Documents in the form of Exhibit 1.1 (J).
Labor Contracts shall mean all employment agreements, employment contracts,
collective bargaining agreements and other agreements among any Loan Party or
Subsidiary of a Loan Party and its employees.
8
Law shall mean any law (including common law), constitution, statute,
treaty, regulation, rule, ordinance, opinion, release, ruling, order,
injunction, writ, decree or award of any Official Body.
Letter of Credit shall have the meaning assigned to that term in Section
2.9. 1,
Letter of Credit Borrowing shall mean an extension of credit resulting from
a drawing under any Letter of Credit which shall not have been reimbursed on the
date when made and shall not have been converted into a Loan under Section
2.9.3.2.
Letter of Credit Fee shall have the meaning assigned to that term in
Section 2.9.2.
Letters of Credit Outstanding shall mean at any time the sum of (i) the
aggregate undrawn face amount of outstanding Letters of Credit and (ii) the
aggregate amount of all unpaid and outstanding Reimbursement Obligations.
Leverage Ratio shall mean the ratio of (x) Total Debt to (y) EBITDA.
Lien shall mean any mortgage, deed of trust, pledge, lien, security
interest, charge or other encumbrance or security arrangement of any nature
whatsoever, whether voluntarily or involuntarily given, including any
conditional sale or title retention arrangement, and any assignment, deposit
arrangement or lease intended as, or having the effect of, security and any
filed financing statement or other notice of any of the foregoing (whether or
not a lien or other encumbrance is created or exists at the time of the filing).
Loan Documents shall mean this Agreement, the Agent's Letter, the Guaranty
Agreement, the Intercompany Subordination Agreement, the Notes, any other
instruments, certificates or documents (including reimbursement agreements
relating to the Letters of Credit) delivered or contemplated to be delivered
hereunder or thereunder or in connection herewith or therewith, as the same may
be supplemented or amended from time to -time in accordance herewith or
therewith, and Loan Document shall mean any of the Loan Documents.
Loan Parties shall mean the Borrowers and the Guarantors and Loan Party
shall mean any Borrower or Guarantor.
Loan Request shall have the meaning given to such term in Section 2.5.
Loans shall mean collectively and Loan shall mean separately all Loans or
any Loan made by the Banks or one of the Banks to the Borrower pursuant to
Section 2.1 or 2.9.3.
9
Material Adverse Change shall mean any set of circumstances or events which
(a) has or could reasonably be expected to have any material adverse effect
whatsoever upon the validity or enforceability of this Agreement or any other
Loan Document, (b) is or could reasonably be expected to be material and adverse
to the business, properties, assets, financial condition, results of operations
or prospects of the Loan Parties taken as a whole, (c) impairs materially or
could reasonably be expected to impair materially the ability of the Loan
Parties taken as a whole to duly and punctually pay or perform-n any material
part of their aggregate Indebtedness, or (d) impairs materially or could
reasonably be expected to impair materially the ability of the Agent or any of
the Banks, to the extent permitted, to enforce their legal remedies pursuant to
this Agreement or any other Loan Document.
Material Venture Investment shall mean any investment in or loan, advance
or capital contribution to any Person by a Loan Party, or any commitment to do
so, having a value of $2,000,000 or more.
Month, with respect to an Interest Period under the Euro-Rate Option, shall
mean the interval between the days in consecutive calendar months numerically
corresponding to the first day of such Interest Period. If any Euro-Rate
Interest Period begins on a day of a calendar month for which there is no
numerically corresponding day in the month in which such Interest Period is to
end, the final month of such Interest Period shall be deemed to end on the last
Business Day of such final month.
Multiemployer Plan shall mean any employee benefit plan which is a
"multiemployer plan" within the meaning of Section 4001(a)(3) of ERISA and
either (i) to which any member of the ERISA Group is making or accruing an
obligation to make contributions or (ii) within the preceding five years any
entity which at such time was a member of the ERISA Group, has made or had an
obligation to make such contributions and with respect to which the Borrower is
reasonably likely to have liability under Subtitle E of Title IV of ERISA.
Multiple Employer Plan shall mean an employee pension benefit plan (but
excluding any Multiemployer Plan) which is covered by Title IV of ERISA or is
subject to the minimum funding standards under Section 412 of the Internal
Revenue Code and which has two or more contributing sponsors (including the
Borrower or any member of the ERISA Group) at least two of whom are not under
common control, as such a plan is described in Sections 4063 and 4064 of ERISA.
Notes shall mean collectively and Note shall mean separately all the Notes
of the Borrower in the form of Exhibit 1.1 (R) evidencing the Loans together
with all amendments, extensions, renewals, replacements, refinancings or
refundings thereof in whole or in part.
notices shall have the meaning assigned to that term in Section 1 1.6.
Obligation shall mean any obligation or liability of any of the Loan
Parties to the Agent or any of the Banks, howsoever created, arising or
evidenced, whether direct or
10
indirect, absolute or contingent, now or hereafter existing, or due or to become
due, under or in connection with this Agreement, the Notes, the Letters of
Credit, the Agent's Letter or any other Loan Document.
Official Body shall mean any national, federal, state, local or other
government or political subdivision or any agency, authority, bureau, central
bank, commission, department or instrumentality of either, or any court,
tribunal, grand jury or arbitrator, in each case whether foreign or domestic.
Outside Investment Amount shall mean the sum of the dollar value of (i)
outstanding Guarantees of Persons in which investments are permitted under
Section 8.2.9; (ii) investments made under Section 8.2.9; (iii) investments made
under Section 8.2.4(vi); (iv) Permitted Acquisitions made under Section
8.2.6(xi), (v) asset sales made under clause (B) of Section 8.2.7(iii) and (vi)
investments in Persons who are not Borrowers which are made under Section 8.2.9,
each as made or (as to Guarantees referred to in Clause (i) hereof) existing
from time to time after the Closing Date.
Outside Investment Limit shall mean $7,500,000.
Parent shall mean XX Xxxx'x Corporation, a Delaware corporation, which owns
100% of the issued and outstanding capital stock of the Company and which is the
Guarantor hereunder.
Participation Advance shall mean, with respect to any Bank, such Bank's
payment in respect of its participation in a Letter of Credit Borrowing
according to its Ratable Share pursuant to Section 2.9.4.
PBGC shall mean the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA or any successor statute.
Permitted Acquisitions shall have the meaning assigned to such ten-n in
Section 8.2.6.
Permitted Amount shall have the meaning assigned to such term in Section
8.2.15.
Permitted Investments shall mean:
(i) direct obligations of the United States of America or any agency
or instrumentality thereof or obligations backed by the full faith and
credit of the United States of America maturing in twelve (I 2) months or
less from the date of acquisition;
(ii) commercial paper maturing in 180 days or less rated not lower
than X- 0, by Standard & Poor's or P-1 by Xxxxx'x Investors Service, Inc.
on the date of acquisition; and
11
(iii) demand deposits, time deposits or certificates of deposit
maturing within one year in any Bank or any commercial banks whose
obligations are rated A-1, A or the equivalent or better by Standard &
Poor's on the date of acquisition.
Permitted Liens shall mean:
(i) Liens for taxes, assessments, or similar charges, incurred in the
ordinary course of business and which are not yet due and payable;
(ii) Pledges or deposits made in the ordinary course of business to
secure payment of workmen's compensation, or to participate in any fund in
connection with workmen's compensation, unemployment insurance, old-age
pensions or other social security programs;
(iii) Liens of mechanics, materialmen, warehousemen, carriers, or
other like Liens, securing obligations incurred in the ordinary course of
business that are not yet due and payable and Liens of landlords securing
obligations to pay lease payments that are not yet due and payable or in
default;
(iv) Good-faith pledges or deposits made in the ordinary course of
business to secure performance of bids, tenders, contracts (other than for
the repayment of borrowed money) or leases, not in excess of the aggregate
amount due thereunder, or to secure statutory obligations, or surety,
appeal, indemnity, performance or other similar bonds required in the
ordinary course of business;
(v) Encumbrances consisting of zoning restrictions, easements or other
restrictions on the use of real property, none of which materially impairs
the use of such property or the value thereof, and none of which is
violated in any material respect by existing or proposed structures or land
use;
(vi) Liens, security interests and mortgages in favor of the Agent for
the benefit of the Banks;
(vii) Liens on property leased by any Loan Party or Subsidiary of a
Loan Party under capital and operating leases permitted in Section 8.2.15
securing obligations of such Loan Party or Subsidiary to the lessor under
such leases;
(viii) Any Lien existing on the date of this Agreement and described
on Schedule 1.1 (P), provided that the principal amount secured thereby is
not hereafter increased, and no additional assets become subject to such
Lien;
(ix) Purchase Money Security Interests, provided that the aggregate
amount of loans and deferred payments secured by such Purchase Money
Security Interests shall not exceed $2,500,000 (excluding for the purpose
of this computation any loans or deferred payments secured by Liens
described on Schedule 1.1(P));
12
(x) - The following, (A) if the validity or amount thereof is being
contested in good faith by appropriate and lawful proceedings diligently
conducted so long as levy and execution thereon have been stayed and
continue to be stayed or (B) if a final judgment is entered and such
judgment is discharged within thirty (30) days of entry, and in either case
they do not materially impair the ability of any Loan Party to perform-n
its Obligations hereunder or under the other Loan Documents:
(1) Claims or Liens for taxes, assessments or charges due and
payable and subject to interest or penalty, provided that the
applicable Loan Party maintains such reserves or other appropriate
provisions as shall be required by GAAP and pays all such taxes,
assessments or charges forthwith upon the commencement of proceedings
to foreclose any such Lien;
(2) Claims, Liens or encumbrances upon, and defects of title to,
real or personal property, including any attachment of personal or
real property or other legal process prior to adjudication of a
dispute on the merits;
(3) Claims or Liens of mechanics, materialmen, warehousemen,
carriers, or other statutory nonconsensual Liens;
(4) Liens resulting from final judgments or orders described in
Section 9.1.6, and
(xi) Liens which are outstanding on any fixed assets at the time such
fixed assets are acquired by a Borrower or which are outstanding on any
fixed asset of an entity acquired by a Borrower at the time such entity is
acquired; provided that such Liens do not extend to or cover any other
property or assets.
Permitted Transferee shall mean (i) any person controlled by Xxxxxx X.
Xxxxx (the term "control" having the same meaning as such term in the definition
of "Affiliate"), (ii) any director or executive officer of any Person described
in clause (i) above as of one year prior to the date of determination, (iii) any
heir, executor, administrator, testamentary trustee, legatee, beneficiary or
distributes of Xxxxxx X. Xxxxx and (iv) any trust, the beneficiaries of which
include only Xxxxxx X. Xxxxx and any Person described in clause (iii) above.
Person shall mean any individual, corporation, partnership, limited
liability company, association, joint-stock company, trust, unincorporated
organization, joint venture, government or political subdivision or agency
thereof, or any other entity.
Plan shall mean an employee pension benefit plan (but excluding any
Multiple Employer Plan or Multiemployer Plan) which is covered by Title IV of
ERISA or is subject to the minimum funding standards under Section 412 of the
Internal Revenue Code and either (i) is maintained by any member of the ERISA
Group for employees of any member of the ERISA Group or (ii) has at any time
within the preceding five years been maintained by any entity which was at such
time a member of the ERISA Group for employees of any entity which
13
was at such time a member of the ERISA Group and with respect to which a Loan
Party is reasonably likely to have liability under Section 4062, 4063 or 4064 of
ERISA.
PNC Bank shall mean PNC Bank, National Association, its successors and
assigns.
Potential Default shall mean any event or condition which with notice,
passage of time or a determination by the Agent or the Required Banks, or any
combination of the foregoing, would constitute an Event of Default.
Principal Office shall mean the main banking office of the Agent in Camp
Hill, Pennsylvania.
Prohibited Transaction shall mean any prohibited transaction as defined in
Section 4975 of the Internal Revenue Code or Section 406 of ERISA for which
neither an individual nor a class exemption has been issued by the United States
Department of Labor.
Property shall mean all real property, both owned and leased, of any Loan
Party or Subsidiary of a Loan Party.
Purchase Money Security Interest shall mean Liens upon tangible personal
property securing loans to any Loan Party or Subsidiary of a Loan Party or
deferred payments by such Loan Party or Subsidiary for the purchase of such
tangible personal property.
Purchasing Bank shall mean a Bank which becomes a party to this Agreement
by executing an Assignment and Assumption Agreement.
Ratable Share shall mean the proportion that a Bank's Commitment bears to
the Commitments of all of the Banks.
Regulated Substances shall mean any substance, including any solid, liquid,
semisolid, gaseous, thermal, thoriated or radioactive material, refuse, garbage,
wastes, chemicals, petroleum products, by-products, coproducts, impurities,
dust, scrap, heavy metals, defined as a "hazardous substance," "pollutant,"
"pollution," "contaminant," "hazardous or toxic substance," "extremely hazardous
substance," "toxic chemical," "toxic waste," "hazardous waste," "industrial
waste," "residual waste," "solid waste," "municipal waste," "mixed waste,"
"infectious waste," "chemotherapeutic waste," "medical waste," or "regulated
substance" or any related materials, substances or wastes as now or hereafter
defined pursuant to any Environmental Laws, ordinances, rules, regulations or
other directives of any Official Body, the generation, manufacture, extraction,
processing, distribution, treatment, storage, disposal, transport, recycling,
reclamation, use, reuse, spilling, leaking, dumping, injection, pumping,
leaching, emptying, discharge, escape, release or other management or
mismanagement of which is regulated by the Environmental Laws.
14
Regulation U shall mean Regulation U, T, G or X as promulgated by the Board
of Governors of the Federal Reserve System, as amended from time to time.
Reimbursement Obligation shall have the meaning assigned to such term in
Section 2.9.3.2.
Reportable Event shall mean a reportable event described in Section 4043 of
ERISA and regulations thereunder with respect to a Plan or Multiemployer Plan.
Required Banks shall mean
(i) if there are no Loans, Reimbursement Obligations or Letter of
Credit Borrowings outstanding, Banks whose Commitments aggregate at least
66-2/3% of the Commitments of all of the Banks, or
(ii) if there are Loans, Reimbursement Obligations, or Letter of
Credit Borrowings outstanding, any Bank or group of Banks if the sum of the
Loans, Reimbursement Obligations and Letter of Credit Borrowings of such
Banks then outstanding aggregates at least 66-2/3% of the total principal
amount of all of the Loans, Reimbursement Obligations and Letter of Credit
Borrowings then outstanding. Reimbursement Obligations and Letter of Credit
Borrowings shall be deemed, for purposes of this definition, to be in favor
of the Agent and not a participating Bank if such Bank has not made its
Participation Advance in respect thereof and shall be deemed to be in favor
of such Bank to the extent of its Participation Advance if it has made its
Participation Advance in respect thereof.
Revolving Facility Usage shall mean at any time the sum of the Loans
outstanding and the Letters of Credit Outstanding.
Section 20 Subsidiary shall mean the Subsidiary of the bank holding company
controlling any Bank, which Subsidiary has been granted authority by the Federal
Reserve Board to underwrite and deal in certain Ineligible Securities.
Shares shall have the meaning assigned to that term in Section 6.1.2.
Standard & Poor's shall mean Standard & Poor's Ratings Services, a division
of The XxXxxx-Xxxx Companies, Inc.
Standby Letter of Credit shall mean a Letter of Credit issued to support
obligations of one or more of the Loan Parties, contingent or otherwise, which
finance the working capital and business needs of the Loan Parties incurred in
the ordinary course of business.
Subsidiary of any Person at any time shall mean (i) any corporation or
trust of which 50% or more (by number of shares or number of votes) of the
outstanding capital stock or shares of beneficial interest normally entitled to
vote for the election of one or more
15
directors or trustees (regardless of any contingency which does or may suspend
or dilute the voting rights) is at such time owned directly or indirectly by
such Person or one or more of such Person's Subsidiaries, (ii) any partnership
of which such Person is a general partner or of which 50% or more of the
partnership interests is at the time directly or indirectly owned by such Person
or one or more of such Person's Subsidiaries, (iii) any limited liability
company of which such Person is a member or of which 50% or more of the limited
liability company interests is at the time directly or indirectly owned by such
Person or one or more of such Person's Subsidiaries or (iv) any corporation,
trust, partnership, limited liability company or other entity which is
controlled or capable of being controlled by such Person or one or more of such
Person's Subsidiaries.
Syndications Period shall mean the period between the Closing Date and the
date which is sixty (60) days after the Closing Date.
XX Xxxx'x Incorporated shall mean XX Xxxx'x Incorporated, a Pennsylvania
corporation and a "Borrower" and the "Company" hereunder.
Total Debt shall mean long-term and short term Indebtedness for borrowed
money of the Parent on a consolidated basis including subordinated debt on which
interest is contractually payable and obligations under capital leases,
guarantees and letters of credit (including the Letters of Credit).
Transferor Bank shall mean the selling Bank pursuant to an Assignment and
Assumption Agreement.
1.2 Construction.
Unless the context of this Agreement otherwise clearly requires, the
following rules of construction shall apply to this Agreement and each of
the other Loan Documents:
1.2.1 Number; Inclusion.
references to the plural include the singular, the plural, the
part and the whole; "or" has the inclusive meaning represented by the
phrase "and/or," and "including" has the meaning represented by the
phrase "including without limitation";
1.2.2 Determination.
references to "determination" of or by the Agent or the Banks
shall be deemed to include good-faith estimates by the Agent or the
Banks (in the case of quantitative determinations) and good-faith
beliefs by the Agent or the Banks (in the case of qualitative
determinations) and such determination shall be conclusive absent
manifest error;
16
1.2.3 Agent's Discretion and Consent.
whenever the Agent or the Banks are granted the right herein to
act in its or their sole discretion or to grant or withhold consent
such right shall be exercised in good faith;
1.2.4 Documents Taken as a Whole.
the words "hereof," "herein," "hereunder," "hereto" and similar
terms in this Agreement or any other Loan Document refer to this
Agreement or such other Loan Document as a whole and not to any
particular provision of this Agreement or such other Loan Document;
1.2.5 Headings.
the section and other headings contained in this Agreement or
such other Loan Document and the Table of Contents (if any), preceding
this Agreement or such other Loan Document are for reference purposes
only and shall not control or affect the construction of this
Agreement or such other Loan Document or the interpretation thereof in
any respect;
1.2.6 Implied References to this Agreement.
article, section, subsection, clause, schedule and exhibit
references are to this Agreement or other Loan Document, as the case
may be, unless otherwise specified;
1.2.7 Persons.
reference to any Person includes such Person's successors and
assigns but, if applicable, only if such successors and assigns are
permitted by this Agreement or such other Loan Document, as the case
may be, and reference to a Person in a particular capacity excludes
such Person in any other capacity;
1.2.8 Modifications to Documents.
reference to any agreement (including this Agreement and any
other Loan Document together with the schedules and exhibits hereto or
thereto), document or instrument means such agreement, document or
instrument as amended, modified, replaced, substituted for, superseded
or restated;
1.2.9 From, To and Through.
relative to the determination of any period of time, "from" means
"from and including," "to" means "to but excluding," and "through"
means "through and including"; and
17
1.2.10 Shall; Will.
references to "shall" and "will" are intended to have the same
meaning.
1.3 Accounting Principles.
Except as otherwise provided in this Agreement, all computations and
determinations as to accounting or financial matters and all financial
statements to be delivered pursuant to this Agreement shall be made and
prepared in accordance with GAAP (including principles of consolidation
where appropriate), and all accounting or financial terms shall have the
meanings ascribed to such terms by GAAP; provided, however, that all
accounting terms used in Section 8.2 (and all defined terms used in the
definition of any accounting term used in Section 8.2 shall have the
meaning given to such terms (and defined terms) under GAAP as in effect on
the date hereof applied on a basis consistent with those used in preparing
the Annual Statements referred to in Section 6.1.9(i). In the event of any
change after the date hereof in GAAP, and if such change would result in
the inability to determine compliance with the financial covenants set
forth in Section 8.2 based upon the Parent's regularly prepared financial
statements by reason of the preceding sentence, then the parties hereto
agree to endeavor, in good faith, to agree upon an amendment to this
Agreement that would adjust such financial covenants in a manner that would
not affect the substance thereof, but would allow compliance therewith to
be determined in accordance with the Loan Parties' financial statements at
that time.
2. REVOLVING CREDIT FACILITY
2.1 Commitments.
2.1.1 Loans.
Subject to the terms and conditions hereof and relying upon the
representations and warranties herein set forth each Bank severally
agrees to make Loans to the Borrowers at any time or from time to time
on or after the Closing Date to the Expiration Date provided that
after giving effect to such Loan the aggregate amount of Loans from
such Bank shall not exceed such Bank's Commitment minus such Bank's
Ratable Share of the Letters of Credit Outstanding. Within such limits
of time and amount and subject to the other provisions of this
Agreement, the Borrowers may borrow, repay and reborrow pursuant to
this Section 2. 1.
2.1.2 Voluntary Reduction of Commitment.
The Borrowers shall have the right at any time and from time to
time upon five (5) Business Days' prior written notice to the Agent to
permanently reduce, in a minimum amount of $ 1,000,000 and whole
multiples of $100,000 of principal, or terminate the Commitment,
without penalty or premium except as hereinafter set forth, provided
that any such reduction or termination shall be accompanied by
prepayment of the Notes, together with the full
18
amount of interest accrued on the principal sum to be prepaid (and all
amounts referred to in Section 5.6.2 hereof), to the extent that the
aggregate amount thereof then outstanding exceeds the Commitment as so
reduced or terminated.
2.2 Nature of Banks' Obligations with Respect to Loans.
Each Bank shall be obligated to participate in each request for Loans
pursuant to Section 2.5 in accordance with its Ratable Share. The aggregate
of each Bank's Loans outstanding hereunder to the Borrowers at any time
shall never exceed its Commitment minus its Ratable Share of the Letter of
Credit Outstandings. The obligations of each Bank hereunder are several.
The failure of any Bank to perform its obligations hereunder shall not
affect the Obligations of the Borrowers to any other party nor shall any
other party be liable for the failure of such Bank to perform its
obligations hereunder. The Banks shall have no obligation to make Loans
hereunder on or after the Expiration Date.
2.3 Commitment Fees.
Accruing from the date hereof until the Expiration Date, the Borrowers
agree to pay to the Agent for the account of each Bank, as consideration
for such Bank's Commitment hereunder, a nonrefundable commitment fee (the
"Commitment Fee") computed using the rate per annum (the "Commitment Fee
Applicable Margin") set forth below measured in respect of the Borrowers'
Leverage Ratio as of the end of each fiscal quarter:
(a) if the Borrowers' Leverage Ratio is less than or equal to 1.0 to
1.0, then the Commitment Fee Applicable Margin shall be .20%; and
(b) if the Borrowers' Leverage Ratio is greater than 1.0 to 1.0 but
less than or equal to 1.5 to 1.0, then the Commitment Fee Applicable Margin
shall be .25%; and
(c) if the Borrower's Leverage Ratio is greater than 1.5 to 1.0 but
less than or equal to 2.0 to 1.0, then the Commitment Fee Applicable Margin
shall be .30%; and
(d) if the Borrower's Leverage Ratio is greater than 2.0 to 1.0 but
less than or equal to 2.5 to 1.0, then the Commitment Fee Applicable Margin
shall be .3 5 %; and
(e) if the Borrower's Leverage Ratio is greater than 2.5 to 1.0, then
the Commitment Fee Applicable Margin shall be .40%.
The Commitment Fee shall be computed on the basis of a year of 365 or 366 days,
as the case may be, and actual days elapsed on the average daily difference
between the amount of such Bank's Commitment as the same may be constituted from
time to time and the Revolving Facility Usage. Any changes in the Commitment Fee
pursuant to the provisions of this Section 2.3 shall become effective from the
fifth day after the Agent shall have received the Certificate delivered pursuant
to Section 8.3.4 in respect of such fiscal quarter; provided, that, in the event
that the Certificate delivered pursuant to Section 8.3.4 for any fiscal quarter
is not delivered
19
within ten (10) days of the date required by Section 8.3 (no waiver by the Agent
being implied thereby), then the Commitment Fee shall be calculated on the basis
of the percentage set forth in item (e) above commencing as of the date such
certificate was required to be delivered until the delivery of such certificate.
All Commitment Fees shall be payable in arrears on the first Business Day of
each January, April, July and October after the date hereof and on the
Expiration Date or upon acceleration of the Notes. Notwithstanding anything
herein to the contrary, the Commitment Fee Applicable Margin prior to the end of
the first fiscal quarter ending after the Closing Date shall be .25%.
2.4 Revolving, Credit Facility Fee.
The Borrowers agree to pay on the Closing Date to the Agent for the
account of each Bank, as consideration for such Bank's Commitment, a
nonrefundable closing fee equal to .I% of each Bank's Commitment.
2.5 Loan Requests.
Except as otherwise provided herein, the Borrowers may from time to
time prior to the Expiration Date request the Banks to make Loans, or renew
or convert the Interest Rate Option applicable to existing Loans pursuant
to Section 4.2, by delivering to the Agent, not later than 11:00 a.m., Camp
Hill time, (i) three (3) Business Days prior to the proposed Borrowing Date
with respect to the making of Loans to which the Euro-Rate Option applies
or the conversion to or the renewal of the Euro-Rate Option for any Loans;
and (ii) the Business Day of the proposed Borrowing Date with respect to
the making of a Loan to which the Base Rate Option applies or the last day
of the preceding Interest Period with respect to the conversion to the Base
Rate Option for any Loan, of a duly completed request therefor
substantially in the form of Exhibit 2.5 or a request by telephone
immediately confirmed in writing by letter, facsimile or telex in such form
(each, a "Loan Request"), it being understood that the Agent may rely on
the authority of any individual making such a telephonic request without
the necessity of receipt of such written confirmation. Each Loan Request
shall be irrevocable and shall specify (i) the proposed Borrowing Date;
(ii) the aggregate amount of the proposed Loans comprising each Borrowing
Tranche, which shall be in integral multiples of $100,000 and not less than
$ 1,000,000 for each Borrowing Tranche to which the Euro-Rate Option
applies and not less than the lesser of $500,000 or the maximum amount
available for Borrowing Tranches to which the Base Rate Option applies;
(iii) whether the Euro-Rate Option or Base Rate Option shall apply to the
proposed Loans comprising the applicable Borrowing Tranche; and (iv) in the
case of a Borrowing Tranche to which the Euro-Rate Option applies, an
appropriate Interest Period for the proposed Loans comprising such
Borrowing Tranche.
2.6 Making, Loans.
The Agent shall, promptly after receipt by it of a Loan Request
pursuant to Section 2.5, notify the Banks of its receipt of such Loan
Request specifying: (i) the proposed Borrowing Date and the time and method
of disbursement of the Loans requested thereby;
20
(ii) the amount and type of each such Loan and the applicable Interest
Period (if any); and (iii) the apportionment among the Banks of such Loans
as determined by the Agent in accordance with Section 2.2. Each Bank shall
remit the principal amount of each Loan to the Agent such that the Agent is
able to, and the Agent shall, to the extent the Banks have made funds
available to it for such purpose and subject to Section 7.2, fund such
Loans to the Borrower in U.S. Dollars and immediately available funds at
the Principal Office prior to 2:00 p.m., Camp Hill time, on the applicable
Borrowing Date, provided that if any Bank fails to remit such funds to the
Agent in a timely manner, the Agent may elect in its sole discretion to
fund with its own funds the Loans of such Bank on such Borrowing Date, and
such Bank shall be subject to the repayment obligation in Section 10. 16.
2.7 Notes.
The Obligation of the Borrowers to repay the aggregate unpaid
principal amount of the Loans made to it by each Bank, together with
interest thereon, shall be evidenced by a Note dated the Closing Date
payable to the order of such Bank in a face amount equal to the Commitment
of such Bank.
2.8 Use of Proceeds.
The proceeds of the Loans shall be used to refinance existing
indebtedness and for general corporate purposes, including making Permitted
Acquisitions and in accordance with Section 8.1.10.
2.9 Letter of Credit Subfacility.
2.9.1 Issuance of Letters of Credit.
The Borrowers may request the issuance of a letter of credit
(each a "Letter of Credit") on behalf of itself or another Loan Party
by delivering to the Agent a completed application and agreement for
letters of credit in such form as the Agent may specify from time to
time by no later than 10:00 a.m., Camp Hill time, at least three (3)
Business Days, or such shorter period as may be agreed to by the
Agent, in advance of the proposed date of issuance. Promptly after
such request, the Agent shall notify each Bank of such request. Each
Letter of Credit shall be either a Standby Letter of Credit or a
Commercial Letter of Credit. Subject to the terms and conditions
hereof and in reliance on the agreements of the other Banks set forth
in this Section 2.9, the Agent will issue a Letter of Credit provided
that each Letter of Credit shall (A) have a maximum maturity of twelve
(12) months from the date of issuance and shall be renewable for up to
twelve (I 2) more months at the Agent's discretion, and (B) in no
event expire later than one Business Day prior to the Expiration Date
and providing that in no event shall (i) the Letters of Credit
Outstanding exceed, at any one time, $5,000,000 or (ii) the Revolving
Facility Usage exceed, at any one time, the Commitments.
21
2.9.2 Letter of Credit Fees.
The Borrowers shall pay (i) to the Agent for the ratable account
of the Banks a fee (the "Letter of Credit Fee") equal to the
Applicable Margin, and (ii) to the Agent for its own account a
fronting fee equal to 1/8% per annum, which fees shall be computed on
the daily average Letters of Credit Outstanding and shall be payable
quarterly in arrears commencing with the first Business Day of each
January, April, July and October following issuance of each Letter of
Credit and on the Expiration Date and calculated on the basis of a
year of 365/365 days. The Borrowers shall also pay to the Agent for
the Agent's sole account the Agent's then in effect customary fees and
administrative expenses payable with respect to the Letters of Credit
as the Agent may generally charge or incur from time to time in
connection with the issuance, maintenance, modification (if any),
assignment or transfer (if any), negotiation, and administration of
Letters of Credit.
2.9.3 Disbursements, Reimbursement.
2.9.3.1 Immediately upon the Issuance of each Letter of
Credit, each Bank shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the Agent a
participation in such Letter of Credit and each drawing
thereunder in an amount equal to such Bank's Ratable Share of the
maximum amount available to be drawn under such Letter of Credit
and the amount of such drawing, respectively.
2.9.3.2 In the event of any request for a drawing under a
Letter of Credit by the beneficiary or transferee thereof, the
Agent will promptly notify the Borrowers. Provided that it shall
have received such notice, the Borrowers shall reimburse (such
obligation to reimburse the Agent shall sometimes be referred to
as a "Reimbursement Obligation") the Agent prior to 12:00 noon,
Camp Hill time on each date that an amount is paid by the Agent
under any Letter of Credit (each such date, an "Drawing Date") in
an amount equal to the amount so paid by the Agent. In the event
the Borrower fails to reimburse the Agent for the full amount of
any drawing under any Letter of Credit by 12:00 noon, Camp Hill
time, on the Drawing Date, the Agent will promptly notify each
Bank thereof, and the Borrowers shall be deemed to have requested
that Loans be made by the Banks under the Base Rate Option to be
disbursed on the Drawing Date under such Letter of Credit,
subject to the amount of the unutilized portion of the Commitment
and subject to the conditions set forth in Section 7.2 other than
any notice requirements. Any notice given by the Agent pursuant
to this Section 2.9.3.2 may be oral if immediately confirmed in
writing; provided that the lack of such an immediate confirmation
shall not affect the conclusiveness or binding effect of such
notice.
2.9.3.3 Each Bank shall upon any notice pursuant to Section
2.9.3.2 make available to the Agent an amount in immediately
available funds equal to its Ratable Share of the amount of the
drawing, whereupon the participating Banks shall (subject to
Section 2.9.3.4) each be deemed to have made a Loan under the
Base Rate Option to the Borrowers in that amount. If any Bank so
notified fails to make available to the Agent for the account of
the Agent the amount of such Bank's Ratable Share of such amount
by no later than
22
2:00 p.m., Camp Hill time on the Drawing Date, then interest
shall accrue on such Bank's obligation to make such payment, from
the Drawing Date to the date on which such Bank makes such
payment, at a rate per annum equal to the Federal Funds Effective
Rate in effect from time to time during such period. The Agent
will promptly give notice of the occurrence of the Drawing Date,
but failure of the Agent to give any such notice on the Drawing
Date or in sufficient time to enable any Bank to effect such
payment on such date shall not relieve such Bank from its
obligation under this Section 2.9.3.3.
2.9.3.4 With respect to any unreimbursed drawing that is not
converted into Loans under the Base Rate Option to the Borrowers
in whole or in part as contemplated by Section 2.9.3.2, because
of the Borrowers' failure to satisfy the conditions set forth in
Section 7.2 other than any notice requirements or for any other
reason, the Borrowers shall be deemed to have incurred from the
Agent a Letter of Credit Borrowing in the amount of such drawing.
Such Letter of Credit Borrowing shall be due and payable on
demand (together with interest) and shall bear interest at the
rate per annum applicable to the Loans under the Base Rate
Option. Each Bank's payment to the Agent pursuant to Section
2.9.3.3 shall be deemed to be a payment in respect of its
participation in such Letter of Credit Borrowing and shall
constitute a Participation Advance from such Bank in satisfaction
of its participation obligation under this Section 2.9.3.
2.9.4 Repayment of Participation Advances.
2.9.4.1 Upon (and only upon) receipt by the Agent for its
account of immediately available funds from the Borrowers (i) in
reimbursement of any payment made by the Agent under the Letter
of Credit with respect to which any Bank has made a Participation
Advance to the Agent, or (ii) in payment of interest on such a
payment made by the Agent under such a Letter of Credit, the
Agent will pay to each Bank, in the same funds as those received
by the Agent, the amount of such Bank's Ratable Share of such
funds, except the Agent shall retain the amount of the Ratable
Share of such funds of any Bank that did not make a Participation
Advance in respect of such payment by Agent.
2.9.4.2 If the Agent is required at any time to return to
any Loan Party, or to a trustee, receiver, liquidator, custodian,
or any official in any Insolvency Proceeding, any portion of the
payments made by any Loan Party to the Agent pursuant to Section
2.9.4.1 in reimbursement of a payment made under the Letter of
Credit or interest or fee thereon, each Bank shall, on demand of
the Agent, forthwith return to the Agent the amount of its
Ratable Share of any amounts so returned by the Agent plus
interest thereon from the date such demand is made to the date
such amounts are returned by such Bank to the Agent, at a rate
per annum equal to the Federal Funds Effective Rate in effect
from time to time.
2.9.5 Documentation.
Each Loan Party agrees to be bound by the terms of the Agent's
application and agreement for letters of credit and the Agent's
written regulations and customary practices relating to letters of
credit, though such interpretation may be different from the such
23
Loan Party's own. In the event of a conflict between such application
or agreement and this Agreement, this Agreement shall govern. It is
understood and agreed that, except in the case of gross negligence or
willful misconduct, the Agent shall not be liable for any error,
negligence and/or mistakes, whether of omission or commission, in
following any Loan Party's instructions or those contained in the
Letters of Credit or any modifications, amendments or supplements
thereto.
2.9.6 Determinations to Honor Drawing Requests.
In determining whether to honor any request for drawing under any
Letter of Credit by the beneficiary thereof, the Agent shall be
responsible only to determine that the documents and certificates
required to be delivered under such Letter of Credit have been
delivered and that they comply on their face with the requirements of
such Letter of Credit.
2.9.7 Nature of Participation and Reimbursement Obligations.
Each Bank's obligation in accordance with this Agreement to make
the Loans or Participation Advances, as contemplated by Section 2.9.3,
as a result of a drawing under a Letter of Credit, and the Obligations
of the Borrowers to reimburse the Agent upon a draw under a Letter of
Credit, shall be absolute, unconditional and irrevocable, and shall be
performed strictly in accordance with the terms of this Section 2.9
under all circumstances, including the following circumstances:
(i) any set-off, counterclaim, recoupment, defense or other
right which such Bank may have against the Agent, the Borrowers
or any other Person for any reason whatsoever;
(ii) the failure of any Loan Party or any other Person to
comply, in connection with a Letter of Credit Borrowing, with the
conditions set forth in Section 2.1, 2.5, 2.6 or 7.2 or as
otherwise set forth in this Agreement for the making of a Loan,
it being acknowledged that such conditions are not required for
the making of a Letter of Credit Borrowing and the obligation of
the Banks to make Participation Advances under Section 2.9.3;
(iii) any lack of validity or enforceability of any Letter
of Credit;
(iv) the existence of any claim, set-off, defense or other
right which any Loan Party or any Bank may have at any time
against a beneficiary or any transferee of any Letter of Credit
(or any Persons for whom any such transferee may be acting), the
Agent or any Bank or any other Person or, whether in connection
with this Agreement, the transactions contemplated herein or any
unrelated transaction (including any underlying transaction
between any Loan Party or Subsidiaries of a Loan Party and the
beneficiary for which any Letter of Credit was procured);
24
(v) any draft, demand, certificate or other document
presented under any Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect even
if the Agent has been notified thereof,
(vi) payment by the Agent under any Letter of Credit against
presentation of a demand, draft or certificate or other document
which does not comply with the terms of such Letter of Credit;
(vii) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or
prospects of any Loan Party or Subsidiaries of a Loan Party;
(viii) any breach of this Agreement or any other Loan
Document by any party thereto;
(ix) the occurrence or continuance of an Insolvency
Proceeding with respect to any Loan Party;
(x) the fact that an Event of Default or a Potential Default
shall have occurred and be continuing;
(xi) the fact that the Expiration Date shall have passed or
this Agreement or the Commitments hereunder shall have been
terminated; and
(xii) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing; provided that
each Bank's obligation to make Loans under Section 2.9.3.3 is
subject to the conditions set forth in Section 7.2.
2.9.8 Indemnity.
In addition to amounts payable as provided in Section 10.5, the
Borrowers hereby agree to protect, indemnify, pay and save harmless
the Agent from and against any and all claims, demands, liabilities,
damages, losses, costs, charges and expenses (including reasonable
fees, expenses and disbursements of counsel and allocated costs of
internal counsel) which the Agent may incur or be subject to as a
consequence, direct or indirect, of (i) the issuance of any Letter of
Credit, other than as a result of (A) the gross negligence or willful
misconduct of the Agent as determined by a final judgment of a court
of competent jurisdiction or (B) subject to the following clause (ii),
the wrongful dishonor by the Agent of a proper demand for payment made
under any Letter of Credit, or (ii) the failure of the Agent to honor
a drawing under any such 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 "Governmental Acts").
25
2.9.9 Liability for Acts and Omissions.
As between any Loan Party and the Agent, such Loan Party assumes
all risks of the acts and omissions of, or misuse of the Letters of
Credit by, the respective beneficiaries of such Letters of Credit. In
furtherance and not in limitation of the foregoing, the Agent shall
not be responsible for: (i) the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in
connection with the application for an issuance of any such Letter of
Credit, even if it should in fact prove to be in any or all respects
invalid, insufficient, inaccurate, fraudulent or forged (even if the
Agent shall have been notified thereof); (ii) the validity or
sufficiency of any instrument transferring or assigning or purporting
to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which
may prove to be invalid or ineffective for any reason; (iii) the
failure of the beneficiary of any such Letter of Credit, or any other
party to which such Letter of Credit may be transferred, to comply
fully with any conditions required in order to draw upon such Letter
of Credit or any other claim of any Loan Party against any beneficiary
of such Letter of Credit, or any such transferee, or any dispute
between or among any Loan Party and any beneficiary of any Letter of
Credit or any such transferee; (iv) 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; (v)
errors in interpretation of technical terms; (vi) any loss or delay in
the transmission or otherwise of any document required in order to
make a drawing under any such Letter of Credit or of the proceeds
thereof-, (vii) the misapplication by the beneficiary of any such
Letter of Credit of the proceeds of any drawing under such Letter of
Credit; or (viii) any consequences arising from causes beyond the
control of the Agent, including any Governmental Acts, and none of the
above shall affect or impair, or prevent the vesting of, any of the
Agent's rights or powers hereunder.
In furtherance and extension and not in limitation of the
specific provisions set forth above, any action taken or omitted by
the Agent under or in connection with the Letters of Credit issued by
it or any documents and certificates delivered thereunder, if taken or
omitted in good faith and not resulting from the Agent's gross
negligence, shall not put the Agent under any resulting liability to
the Borrowers or any Bank.
2.10 Extension by Banks of the Expiration Date.
2.10.1 Requests-, Approval by All Banks.
Upon or promptly after the first anniversary of the Closing
Date or any subsequent anniversary of theClosing Date, the
Borrowers may request a one-year extension of the Expiration Date
by written notice to the Banks, and the Banks agree to respond to
the Borrower's request for an extension by sixty (60) days
following receipt of the request; provided, however, that the
failure of any Bank to respond within such time period shall not
in any manner constitute an agreement by such Bank to extend the
Expiration Date. If all Banks elect to extend, the Expiration
Date shall be extended for a period of one year. If one or more
Banks decline to extend or do not respond to Borrower's request,
the provisions of Section 2.10.2 shall apply.
26
2.10.2 Approval by Required Banks.
In the event that one or more Banks do not agree to extend
the Expiration Date or do not respond to Borrowers' request for
an extension within the time required under Section 2.10.1 (each
a "Bank to be Terminated"), but the Required Banks agree to such
extension within such time then, the Banks which have agreed to
such extension within the time required under Section 2.10.1
(each an "Extending Bank") may, with the prior written approval
of the Borrowers and the Agent, arrange to have one or more other
banks (each an "Assignee Bank") purchase all of the outstanding
Loans, if any, of the Bank to be Terminated and succeed to and
assume the Commitments and all other rights, interests and
obligations of the Bank to be Terminated under this Agreement and
the other Loan Documents. Any such purchase and assumption shall
be (1) pursuant to an Assignment and Assumption Agreement, (2)
subject to and in accordance with Section I 1. I 1, and (3)
effective on the last day of the Interest Period if any Loans are
outstanding under the Euro-Rate Option. The Borrowers shall pay
all amounts due and payable to the Bank to be Terminated on the
effective date of such Assignment and Assumption Agreement. In
the event that the Agent shall become a Bank to be Terminated,
the provisions of this Section 2.10 shall be subject to Section
l0.14. In the event that the Loans and Commitments of a Bank to
be Terminated are not fully assigned and assumed pursuant to
Section 2.10.2 within 120 days following the receipt of the
request to extend, then the Expiration Date shall not be extended
for any Bank.
3 [RESERVED]
4. INTEREST RATES
4.1 Interest Rate Options.
The Borrowers shall pay interest in respect of the outstanding unpaid
principal amount of the Loans as selected by it from the Base Rate Option or
Euro-Rate Option set forth below applicable to the Loans, it being understood
that, subject to the provisions of this Agreement, the Borrowers may select
different Interest Rate Options and different Interest Periods to apply
simultaneously to the Loans comprising different Borrowing Tranches and may
convert to or renew one or more Interest Rate Options with respect to all or any
portion of the Loans comprising any Borrowing Tranche, provided that there shall
not be at any one time outstanding more than four (4) Borrowing Tranches in the
aggregate among all of the Loans accruing interest at a Euro-Rate Option. If at
any time the designated rate applicable to any Loan made by any Bank exceeds
such Bank's highest lawful rate, the rate of interest on such Bank's Loan shall
be limited to such Bank's highest lawful rate.
4.1.1 Revolving Credit Interest Rate Options.
The Borrowers shall have the right to select from the following
Interest Rate Options applicable to the Loans:
27
(i) Base Rate Option: A fluctuating rate per annum (computed on
the basis of a year of 365 or 366 days, as the case may be, and actual
days elapsed) equal to the Base Rate, such interest rate to change
automatically from time to time effective as of the effective date of
each change in the Base Rate;
(ii) Revolving Credit Euro-Rate Option: A rate per annum
(computed on the basis of a year of 360 days and actual days elapsed)
equal to the Euro-Rate plus the rate per annum (the "Applicable
Margin") described below measured in respect of the Borrowers'
Leverage Ratio as of the end of each fiscal quarter:
(a) if the Borrowers' Leverage Ratio is less than or equal
to 1.0 to 1.0, then the Applicable Margin shall be .75%; and
(b) if the Borrowers' Leverage Ratio is greater than 1.0 to
1.0 but less than or equal to 1.5 to 1.0, then the Applicable
Margin shall be 1.00%; and
(c) if the Borrowers' Leverage Ratio is greater than 1.5 to
1.0 but less than or equal to 2.0 to 1.0, then the Applicable
Margin shall be 1.25%; and
(d) if the Borrowers' Leverage Ratio is greater than 2.0 to
1.0 but less than or equal to 2.5 to 1.0, then the Applicable
Margin shall be 1.375%; and
(e) if the Borrowers' Leverage Ratio is greater than 2.5 to
1.0, then the Applicable Marginshall be 1.50%.
Any changes in the Applicable Margin pursuant to the
provisions of this Section 4.1 (a)(ii) shall become effective
from the fifth day after the Agent shall have received the
Certificate delivered pursuant to Section 8.3.4 in respect of
such fiscal quarter; provided, that, in the event that the
Certificate delivered pursuant to Section 8.3.4 for any fiscal
quarter is not timely delivered, then the Applicable Margin shall
be the amount set forth in item (e) above commencing as of the
date such certificate was required to be delivered until the
delivery of such certificate.
(iii)Notwithstanding anything herein to the contrary, any
Euro-Rate Loan made before the end of the first full fiscal quarter
beginning after the Closing Date shall have an Applicable Margin of
1.0%.
4.1.2 Rate Quotations.
The Borrowers may call the Agent on or before the date on which a Loan
Request is to be delivered to receive an indication of the rates then in
effect, but it is acknowledged that such projection shall not be binding on
the Agent or the Banks nor affect the rate of interest which thereafter is
actually in effect when the election is made.
28
4.2 Interest Periods.
At any time when the Borrowers shall select, convert to or renew a
Euro-Rate Option, the Borrowers shall notify the Agent thereof at least three
(3) Business Days prior to the effective date of such Euro-Rate Option by
delivering a Loan Request. The notice shall specify an interest period (the
"Interest Period") during which such Interest Rate Option shall apply, such
Interest Period to be (i) one Month if Borrower selects the Euro-Rate Option
during the Syndications Period and (ii) one, two, three or six Months in the
event Borrower selects the Euro-Rate Option after the Syndications Period has
ended. Notwithstanding the preceding sentence, the following provisions shall
apply to any selection of, renewal of, or conversion to a Euro-Rate Option:
4.2.1 Ending Date and Business Day
any Interest Period which would otherwise end on a date which is not a
Business Day shall be extended to the next succeeding Business Day unless
such Business Day falls in the next calendar month, in which case such
Interest Period shall end on the next preceding Business Day;
4.2.2 Amount of Borrowing Tranche.
each Borrowing Tranche of Euro-Rate Loans shall be in integral
multiples of $ 1 00,000 and not less than $1,000,000;
4.2.3 Termination Before Expiration Date.
the Borrowers shall not select, convert to or renew an Interest Period
for any portion of the Loans that would end after the Expiration Date; and
4.2.4 Renewals.
in the case of the renewal of a Euro-Rate Option at the end of an
Interest Period, the first day of the new Interest Period shall be the last
day of the preceding Interest Period, without duplication in payment of
interest for such day.
4.3 Interest After Default.
To the extent permitted by Law, upon the occurrence of an Event of Default
and until such time such Event of Default shall have been cured or waived:
4.3.1 Letter of Credit Fees, Interest Rate.
the Letter of Credit Fees and the rate of interest for each Loan
otherwise applicable pursuant to Section 2.9.2 or Section 4. 1,
respectively, shall be increased by 2.0% per annum; and
29
4.3.2 Other Obligations.
each other Obligation hereunder if not paid when due shall bear
interest at a rate per annum equal to the sum of the rate of interest
applicable under the Base Rate Option plus an additional 2.0 % per annum
from the time such Obligation becomes due and payable and until it is paid
in full.
4.3.3 Acknowledgment.
The Borrowers acknowledge that the increase in rates referred to in
this Section 4.3 reflects, among other things, the fact that such Loans or
other amounts have become a substantially greater risk given their default
status and that the Banks are entitled to additional compensation for such
risk; and all such interest shall be payable by Borrowers upon demand by
Agent.
4.4 Euro-Rate Unascertainable, Illegality, increased Costs-, Deposits Not
Available
4.4.1 Unascertainable.
If on any date on which a Euro-Rate would otherwise be determined, the
Agent shall have determined that:
(i) adequate and reasonable means do not exist for ascertaining
such Euro-Rate, or
(ii) a contingency has occurred which materially and adversely
affects the secondary market for negotiable certificates of deposit
maintained by dealers of recognized standing relating to the London
interbank eurodollar market relating to the Euro-Rate, the Agent shall
have the rights specified in Section 4.4.3.
4.4.2 Illegality; Increased Costs, Deposits Not Available.
If at any time any Bank shall have determined that:
(i) the making, maintenance or funding of any Loan to which a
Euro-Rate Option applies has been made impracticable or unlawful by
compliance by such Bank in good faith with any Law or any
interpretation or application thereof by any Official Body or with any
request or directive of any such Official Body (whether or not having
the force of Law), or
(ii) such Euro-Rate Option will not adequately and fairly reflect
the cost to such Bank of the establishment or maintenance of any such
Loan, or
(iii) after making all reasonable efforts, deposits of the
relevant amount in Dollars for the relevant Interest Period for a Loan
to which a Euro-Rate
30
Option applies are not available to such Bank at the effective cost of
funding a proposed Loan in the London interbank market,
then the Agent shall have the rights specified in Section 4.4.3.
4.4.3 Agent's and Bank's Rights.
In the case of any event specified in Section 4.4.1 above, the Agent
shall promptly so notify the Banks and the Borrowers thereof, and in the
case of an event specified in Section 4.4.2 above, such Bank shall promptly
so notify the Agent and endorse a certificate to such notice as to the
specific circumstances of such notice, and the Agent shall promptly send
copies of such notice and certificate to the other Banks and the Borrowers.
Upon such date as shall be specified in such notice (which shall not be
earlier than the date such notice is given), the obligation of (A) the
Banks, in the case of such notice given by the Agent, or (B) such Bank, in
the case of such notice given by such Bank, to allow the Borrowers to
select, convert to or renew a Euro-Rate Option shall be suspended until the
Agent shall have later notified the Borrowers, or such Bank shall have
later notified the Agent, of the Agent's or such Bank's, as the case may
be, determination that the circumstances giving rise to such previous
determination no longer exist. If at any time the Agent makes a
determination under Section 4.4.1 and the Borrowers have previously
notified the Agent of its selection of, conversion to or renewal of a
Euro-Rate Option and such Interest Rate Option has not yet gone into
effect, such notification shall be deemed to provide for selection of,
conversion to or renewal of the Base Rate Option otherwise available with
respect to such Loans. If any Bank notifies the Agent of a determination
under Section 4.4.2, the Borrowers shall, subject to the Borrowers'
indemnification Obligations under Section 5.6.2, as to any Loan of the Bank
to which a Euro-Rate Option applies, on the date specified in such notice
either convert such Loan to the Base Rate Option otherwise available with
respect to such Loan or prepay such Loan in accordance with Section 5.4.
Absent due notice from the Borrowers of conversion or prepayment, such Loan
shall automatically be converted to the Base Rate Option otherwise
available with respect to such Loan upon such specified date.
4.4.4 Uniform Application.
Notwithstanding any other provision of this Section 4.4.1 or Section
4.4.2, the Agent and the Banks shall not apply the provisions of thereof
with respect to the Borrowers if it shall not at the time be the general
policy or practice of the Agent of the Bank exercising its rights
thereunder to apply the provisions similar to those of Section 4.4.1 or
4.4.2 to other borrowers in substantially similar circumstances under
substantially comparable provisions of other credit agreements.
4.5 Selection of Interest Rate Options.
If the Borrowers fail to select a new Interest Period to apply to any
Borrowing Tranche of Loans under the Euro-Rate Option at the expiration of an
existing Interest Period applicable to such Borrowing Tranche in accordance with
the provisions of Section 4.2, the
31
Borrowers shall be deemed to have converted such Borrowing Tranche to the Base
Rate Option commencing upon the last day of the existing Interest Period.
5. PAYMENTS
5.1 Payments.
All payments and prepayments to be made in respect of principal, interest,
Commitment Fees, Closing Fees, Letter of Credit Fees, Agent's Fee or other fees
or amounts due from the Borrowers hereunder shall be payable prior to I 1:00
a.m., Camp Hill time, on the date when due without presentment, demand, protest
or notice of any kind, all of which are hereby expressly waived by the
Borrowers, and without set-off, counterclaim or other deduction of any nature,
and an action therefor shall immediately accrue. Such payments shall be made to
the Agent at the Principal Office for the ratable accounts of the Banks with
respect to the Loans in U.S. Dollars and in immediately available funds, and the
Agent shall promptly distribute such amounts to the Banks in immediately
available funds, provided that in the event payments are received by I 1:00
a.m., Camp Hill time, by the Agent with respect to the Loans and such payments
are not distributed to the Banks on the same day received by the Agent, the
Agent shall pay the Banks the Federal Funds Effective Rate with respect to the
amount of such payments for each day held by the Agent and not distributed to
the Banks. The Agent's and each Bank's statement of account, ledger or other
relevant record shall, in the absence of manifest error, be conclusive as the
statement of the amount of principal of and interest on the Loans and other
amounts owing under this Agreement.
5.2 Pro Rata Treatment of Banks.
Each borrowing shall be allocated to each Bank according to its Ratable
Share, and each selection of, conversion to or renewal of any Interest Rate
Option and each payment or prepayment by the Borrowers with respect to
principal, interest, Commitment Fees, Closing Fees, Letter of Credit Fees, or
other fees (except for the Agent's Fee) or amounts due from the Borrower
hereunder to the Banks with respect to the Loans, shall (except as provided in
Section 4.4.3 in the case of an event specified in Section 4.4 [Euro-Rate
Unascertainable]; or 5.6 [Additional Compensation in Certain Circumstances]) be
made in proportion to the applicable Loans outstanding from each Bank and, if no
such Loans are then outstanding, in proportion to the Ratable Share of each
Bank.
5.3 Interest Payment Dates.
Interest on Loans to which the Base Rate Option applies shall be due and
payable in arrears on the first Business Day of each January, April, July and
October after the date hereof and on the Expiration Date or upon acceleration of
the Notes. Interest on Loans to which the Euro-Rate Option applies shall be due
and payable on the last day of each Interest Period for those Loans and, if such
Interest Period is longer than three (3) Months, also on the 90th day of such
Interest Period. Interest on the principal amount of each Loan or other monetary
Obligation
32
shall be due and payable on demand after such principal amount or other monetary
Obligation becomes due and payable (whether on the stated maturity date, upon
acceleration or otherwise).
5.4 Voluntary Prepayments.
5.4.1 Right to Prepay.
The Borrowers shall have the right at its option from time
to time to prepay the Loans in whole or part without premium or
penalty (except as provided in Section 5.6):
(I) at any time with respect to any Loan to which the
Base Rate Option applies,
(ii) on the last day of the applicable Interest Period
with respect to Loans to which a Euro-Rate Option applies,
(iii) on the date specified in a notice by any Bank
pursuant to Section 4.4 [Euro-Rate Unascertainable] with
respect to any Loan to which a Euro-Rate Option applies.
Whenever the Borrowers desire to prepay any part of the
Loans, it shall provide a prepayment notice to the Agent on or
before I 1:00 a.m. (Camp Hill time) at least one (1) Business Day
prior to the date of prepayment of Loans setting forth the
following information:
(x) the date, which shall be a Business Day, on which the
proposed prepayment is to be made;
(y) a statement indicating the application of the prepayment
between the Loans; and
(z) the total principal amount of such prepayment- 9 which
shall not be less than $ 1 00,000.
All prepayment notices shall be irrevocable. The principal
amount of the Loans for which a prepayment notice is given,
together with interest on such principal amount except with
respect to Loans to which the Base Rate Option applies, shall be
due and payable on the date specified in such prepayment notice
as the date on which the proposed prepayment is to be made.
Except as provided in Section 4.4.3, if the Borrowers prepay a
Loan but fail to specify the applicable Borrowing Tranche which
the Borrowers are prepaying, the prepayment shall be applied
first to Loans to which the Base Rate Option applies, then to
Loans to which the Euro-Rate Option applies. Any prepayment
hereunder shall be subject to the Borrowers' Obligation to
indemnify the Banks under Section 5.6.2.
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5.4.2 Change of Lending Office.
Each Bank agrees that upon the occurrence of any event
giving rise to increased costs or other special payments under
Section 4.4.2 [Illegality, etc.] or 5.6.1 [Increased Costs, etc.]
with respect to such Bank, it will if requested by the Borrowers,
use reasonable efforts (subject to overall policy considerations
of such Bank) to designate another lending office for any Loans
or Letters of Credit affected by such event, provided that such
designation is made on such terms that such Bank and its lending
office suffer no economic, legal or regulatory disadvantage, with
the object of avoiding the consequence of the event giving rise
to the operation of such Section. Nothing is this Section 5.4.2
shall affect or postpone any of the Obligations of the Borrowers
or any other Loan Party or the rights of the Agent or any Bank
provided in this Agreement.
5.5 [RESERVED]
5.6 Additional Compensation in Certain Circumstances.
5.6.1 Increased Costs or Reduced Return Resulting From Taxes,
Reserves, Capital Adequacy Requirements, Expenses, Etc.
If any change in any Law, guideline or interpretation or application
thereof by any Official Body charged with the interpretation or
administration thereof or compliance with any request or directive (whether
or not having the force of Law) of any central bank or other Official Body:
(i) subjects any Bank to any tax or changes the basis of taxation
with respect to this Agreement, the Notes, the Loans or payments by
the Borrower of principal, interest, Commitment Fees, or other amounts
due from the Borrowers hereunder or under the Notes (except for taxes
on the overall net income of such Bank),
(ii) imposes, modifies or deems applicable any reserve, special
deposit or similar requirement against credits or commitments to
extend credit extended 'by, or assets (funded or contingent) of,
deposits with or for the account of, or other acquisitions of funds
by, any Bank, or -
(iii) imposes, modifies or deems applicable any capital adequacy
or similar requirement (A) against assets (funded or contingent) of,
or letters of credit, other credits or commitments to extend credit
extended by, any Bank, or (B) otherwise applicable to the obligations
of any Bank under this Agreement,
and the result of any of the foregoing is to increase the cost to,
reduce the income receivable by, or impose any expense (including loss
of margin) upon any Bank with respect to this Agreement, the Notes or
the making, maintenance or funding of any part of the Loans (or, in
the case of any capital adequacy or similar requirement, to have the
effect of reducing the rate of return on any Bank's capital, taking
into consideration such Bank's customary policies with respect to
capital
34
adequacy) by an amount which such Bank in its sole discretion deems to
be material, such Bank shall from time to time notify the Borrowers
and the Agent of the amount determined in good faith (using any
averaging and attribution methods employed in good faith) by such Bank
to be necessary to compensate such Bank for such increase in cost,
reduction of income, additional expense or reduced rate of return.
Such notice shall set forth in reasonable detail the basis for such
determination. Such amount shall be due and payable by the Borrowers
to such Bank ten (10) Business Days after such notice is given.
Notwithstanding any other provision of this Section 5.6. 1, the Agent
and the Banks shall not apply the provisions of hereof with respect to
the Borrowers if it shall not at the time be the general policy or
practice of the Agent or the Bank exercising its rights hereunder to
apply the provisions similar to those of this Section 5.6.1 to other
borrowers in substantially similar circumstances under substantially
comparable provisions of other credit agreements.
5.6.2 Indemnity.
In addition to the compensation required by Section 5.6. 1, the
Borrowers shall indemnify each Bank against all liabilities, losses or
expenses (including loss of margin, any loss or expense incurred in
liquidating or employing deposits from third parties and any loss or
expense incurred in connection with funds acquired by a Bank to find or
maintain Loans subject to a Euro-Rate Option) which such Bank sustains or
incurs as a consequence of any
(i) payment, prepayment, conversion or renewal of any Loan to
which a Euro-Rate Option applies on a day other than the last day of
the corresponding Interest Period (whether or not such payment or
prepayment is mandatory, voluntary or automatic and whether or not
such payment or prepayment is then due),
(ii) attempt by the Borrowers to revoke (expressly, by later
inconsistent notices or otherwise) in whole or part any Loan Requests
under Section 2.5 or Section 4.2 or notice relating to prepayments
under Section 5.4, or
(iii)default by the Borrowers in the performance or observance of
any covenant or condition contained in this Agreement or any other
Loan Document, including any failure of the Borrower to pay when due
(by acceleration or otherwise) any principal, interest, Commitment Fee
or any other amount due hereunder.
If any Bank sustains or incurs any such loss or expense, it shall from
time to time notify the Borrowers of the amount determined in good faith by
such Bank (which determination may include such assumptions, allocations of
costs and expenses and averaging or attribution methods as such Bank shall
deem reasonable) to be necessary to indemnify such Bank for such loss or
expense. Such notice shall set forth in reasonable detail the basis for
such determination. Such amount shall be due and payable by the Borrowers
to such Bank ten (10) Business Days after such notice is given.
35
5.7 Special Provisions Concerning Foreign Borrowers.
Notwithstanding the joint and several liability of the Borrowers with
respect to the Obligations, the liability of a Foreign Borrower on account of
the principal and interest on the Loans shall be limited to the principal amount
advanced to such Borrower and interest and costs of collection thereon.
6. REPRESENTATIONS AND WARRANTIES
6.1 Representations and Warranties.
The Loan Parties, jointly and severally, represent and warrant to the Agent
and each of the Banks as follows:
6.1.1 Organization and Qualification.
Each Loan Party and each Subsidiary of each Loan Party is a
corporation, partnership or limited liability company duly organized,
validly existing and in good standing under the laws of its jurisdiction of
organization. Each Loan Party and each Subsidiary of each Loan Party has
the lawful power to own or lease its properties and to engage in the
business it presently conducts or proposes to conduct. Each Loan Party and
each Subsidiary of each Loan Party is duly licensed or qualified and in
good standing in each jurisdiction listed on Schedule 6. 1.1 and in all
other jurisdictions where the property owned or leased by it or the nature
of the business transacted by it or both makes such licensing or
qualification necessary except where the failure to be so licensed or
qualified would not result in a Material Adverse Change.
6.1.2 Capitalization and Ownership.
The authorized capital stock of each Borrower and the issued and
outstanding shares thereof (referred to herein as the "Shares") are as set
forth on Schedule 6.1.2. All of the Shares have been validly issued and are
fully paid and nonassessable. There are no options, warrants or other
rights outstanding to purchase any such shares except as indicated on
Schedule 6.1.2.
6.1.3 Subsidiaries.
6.1.3.1 Borrower Subsidiaries.
The Borrowers have no Subsidiaries which are not Borrowers other
than those represented by investments permitted by Section 8.2.4(vi)
or 8.2.6(xi), or as shown on Schedule 6.1.3.
6.1.3.2 Affiliates and Subsidiaries of the Parent.
36
The Parent has no Subsidiaries, direct or indirect, other than
the Borrowers, those Persons represented by investments permitted by
Section 8.2.4(vi) or 8.2.6(xi), or as shown on Schedule 6.1.3.
6.1.4 Power and Authority
Each Loan Party has full power to enter into, execute, deliver
and carry out this Agreement and the other Loan Documents to which it
is a party, to incur the Indebtedness contemplated by the Loan
Documents and to perform its Obligations under the Loan Documents to
which it is a party, and all such actions have been duly authorized by
all necessary proceedings on its part.
6.1.5 Validity and Binding Effect.
This Agreement has been duly and validly executed and delivered
by each Loan Party, and each other Loan Document which any Loan Party
is required to execute and deliver on or after the date hereof will
have been duly executed and delivered by such Loan Party on the
required date of delivery of such Loan Document. This Agreement and
each other Loan Document constitutes, or will constitute, legal, valid
and binding obligations of each Loan Party which is or will be a party
thereto on and after its date of delivery thereof, enforceable against
such Loan Party in accordance with its terms, except to the extent
that enforceability of any of such Loan Document may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforceability of creditors' rights generally or
limiting the right of specific performance.
6.1.6 No Conflict.
Neither the execution and delivery of this Agreement or the other
Loan Documents by any Loan Party nor the consummation of the
transactions herein or therein contemplated or compliance with the
terms and provisions hereof or thereof by any of them will conflict
with, constitute a default under or result in any breach of (i) the
terms and conditions of the certificate of incorporation, bylaws,
certificate of limited partnership, partnership agreement, certificate
of formation, limited liability company agreement or other
organizational documents of any Loan Party or (ii) any Law or any
material agreement or instrument or order, writ, judgment, injunction
or decree to which any Loan Party or any of its Subsidiaries is a
party or by which it or any of its Subsidiaries is bound or to which
it is subject, or result in the creation or enforcement of any Lien,
charge or encumbrance whatsoever upon any property (now or hereafter
acquired) of any Loan Party or any of its Subsidiaries (other than
Liens granted under the Loan Documents).
37
6.1.7 Litigation.
There are no actions, suits, proceedings or investigations
pending or, to the knowledge of any Loan Party, threatened against
such Loan Party or any Subsidiary of such Loan Party at law or equity
before any Official Body which individually or in the aggregate may
result in any Material Adverse Change. None of the Loan Parties or any
Subsidiaries of any Loan Party is in violation of any order, writ,
injunction or any decree of any Official Body which would result in
any Material Adverse Change.
6.1.8 Title to Properties.
Each Loan Party and each Subsidiary of each Loan Party has good
and marketable title to or valid leasehold interest in all properties,
assets and other rights which it purports to own or lease or which are
reflected as owned or leased on its books and records, free and clear
of all Liens and encumbrances except Permitted Liens, and subject to
the terms and conditions of the applicable leases. All leases of
property are in full force and effect without the necessity for any
consent which has not previously been obtained upon consummation of
the transactions contemplated hereby.
6.1.9 Financial Statements.
(i) Historical Statements. The Borrowers have delivered to
the Agent copies of the Parent's audited consolidated year-end
financial statements for and as of the end of the three fiscal
years ended December 31, 1995 (the "Annual Statements"). In
addition, the Borrower has delivered to the Agent copies of its
unaudited consolidated interim financial statements for the
fiscal year to date and as of the end of the fiscal quarter ended
June 30, 1996 (the "Interim Statements") (the Annual and Interim
Statements being collectively referred to as the "Historical
Statements"). The Historical Statements were compiled from the
books and records maintained by the Parent's management, are
correct and complete in accordance with GAAP and fairly represent
the consolidated financial condition of the Parent's and its
Subsidiaries as of their dates and the results of operations for
the fiscal periods then ended and have been prepared in
accordance with GAAP, subject (in the case of the Interim
Statements) to normal year-end audit adjustments.
(ii) Financial Projections. The Borrowers have delivered to
the Agent financial projections of the Company for the period
ended December 31, 2001 derived from various assumptions of the
Borrower's management (the "Financial Projections"). The
Financial Projections represent a reasonable range of possible
results in light of the history of the business, present and
foreseeable conditions and the intentions of the Borrower's
management. The Financial Projections accurately reflect the
liabilities of the Borrowers upon consummation of the
transactions contemplated hereby as of the Closing Date.
(iii)Accuracy of Financial Statements. As of the Closing
Date, the Borrowers have no liabilities, contingent or otherwise,
or forward or long-term commitments that are not disclosed in the
Historical Statements or in the notes thereto, and
38
except as disclosed therein there are no unrealized or
anticipated losses from any commitments of the Borrowers which
may cause a Material Adverse Change. Since December 31, 1995, no
Material Adverse Change has occurred.
6.1.10 Use of Proceeds-, Margin Stock.
The Loan Parties intend to use the proceeds of the Loans in
accordance with Sections 2.8, and 8. 1. I 0. None of the Loan Parties
or any Subsidiaries of any Loan Party engages or intends to engage
principally, or as one of its important activities, in the business of
extending credit for the purpose, immediately, incidentally or
ultimately, of purchasing or carrying margin stock (within the meaning
of Regulation U). No part of the proceeds of any Loan has been or will
be used, immediately, incidentally or ultimately, to purchase or carry
any margin stock or to extend credit to others for the purpose of
purchasing or carrying any margin stock or to refund Indebtedness
originally incurred for such purpose, or for any purpose which entails
a violation of or which is inconsistent with the provisions of the
regulations of the Board of Governors of the Federal Reserve System.
None of the Loan Parties or any Subsidiary of any Loan Party holds or
intends to hold margin stock in such amounts that more than 25% of the
reasonable value of the assets of any Loan Party or Subsidiary of any
Loan Party are or will be represented by margin stock.
6.1.11 Full Disclosure.
Neither this Agreement nor any other Loan Document, nor any
certificate, statement, agreement or other documents furnished to the
Agent or any Bank in connection herewith or therewith, contains any
untrue statement of a material fact or omits to state a material fact
necessary in order to make the statements contained herein and
therein, in light of the circumstances under which they were made, not
misleading. There is no fact known to any Loan Party which materially
adversely affects the business, property, assets, financial condition,
results of operations or prospects of the Loan Parties taken as a
whole which has not been set forth in this Agreement or in the
certificates, statements, agreements or other documents furnished in
writing to the Agent and the Banks prior to or at the date hereof in
connection with the transactions contemplated hereby.
6.1.12 Taxes.
All federal, state, local and other tax returns required to have
been filed with respect to each Loan Party and each Subsidiary of each
Loan Party have been filed, and payment or adequate provision has been
made for the payment of all taxes, fees, assessments and other
governmental charges which have or may become due pursuant to said
returns or to assessments received, except to the extent that such
taxes, fees, assessments and other charges are being contested in good
faith by appropriate proceedings diligently conducted and for which
such reserves or other appropriate provisions, if any, as shall be
required by GAAP shall have been made. As of the Closing Date, there
are no agreements or waivers extending the statutory period of
limitations applicable to any federal income tax return of any Loan
Party or Subsidiary of any Loan Party for any period.
39
6.1.13 Consents and Approvals.
No consent, approval, exemption, order or authorization of, or a
registration or filing with, any Official Body or any other Person is
required by any Law or any agreement in connection with the execution,
delivery and carrying out of this Agreement and the other Loan
Documents by any Loan Party.
6.1.14 No Event of Default; Compliance with Instruments.
No event has occurred and is continuing and no condition exists
or will exist after giving effect to the borrowings or other
extensions of credit to be made on the Closing Date under or pursuant
to the Loan Documents which constitutes an Event of Default or
Potential Default. None of the Loan Parties or any Subsidiaries of any
Loan Party is in violation of (i) any term of its certificate of
incorporation, bylaws, certificate of limited partnership, partnership
agreement, certificate of formation, limited liability company
agreement or other organizational documents or (ii) any material
agreement or instrument to which it is a party or by which it or any
of its properties may be subject or bound where such violation would
constitute a Material Adverse Change.
6.1.15 Patents, Trademarks, Copyrights, Licenses, Etc.
Each Loan Party and each Subsidiary of each Loan Party owns or
possesses all the material patents, trademarks, service marks, trade
names, copyrights, licenses, registrations, franchises, permits and
rights necessary to own and operate its properties and to carry on its
business as presently conducted and planned to be conducted by such
Loan Party or Subsidiary, without known possible, alleged or actual
conflict with the rights of others.
6.1.16 Insurance.
Schedule 6.1.16 lists all insurance policies and other bonds to
which any Loan Party or Subsidiary of any Loan Party is a party as of
the Closing Date, all of which are valid and in full force and effect.
No notice has been given or claim made and no grounds exist to cancel
or avoid any of such policies or bonds or to reduce the coverage
provided thereby. Such policies and bonds provide adequate coverage
from reputable and financially sound insurers in amounts sufficient to
insure the assets and risks of each Loan Party and each Subsidiary of
each Loan Party in accordance with prudent business practice in the
industry of the Loan Parties and their Subsidiaries.
6.1.17 Compliance with Laws.
The Loan Parties and their Subsidiaries are in compliance in all
material respects with all applicable Laws (other than Environmental
Laws which are specifically addressed in Section 6.1.22) in all
jurisdictions in which any Loan Party or Subsidiary of any Loan Party
is presently or will be doing business except where the failure to do
so would not constitute a Material Adverse Change.
40
6.1.18 Material Contracts-, Burdensome Restrictions.
All material contracts of each Loan Party are valid, binding and
enforceable upon such Loan Party and each of the other parties thereto
in accordance with their respective terms, and there is no default
thereunder, to the Loan Parties' knowledge, with respect to parties
other than such Loan Party except where such failure would not result
in a Material Adverse Change. None of the Loan Parties or their
Subsidiaries is bound by any contractual obligation, or subject to any
restriction in any organization document, or any requirement of Law
which would result in a Material Adverse Change.
6.1.19 Investment Companies-, Regulated Entities.
None of the Loan Parties or any Subsidiaries of any Loan Party is
an "investment company" registered or required to be registered under
the Investment Company Act of 1940 or under the "control" of an
"investment company" as such terms are defined in the Investment
Company Act of 1940 and shall not become such an "investment company"
or under such "control." None of the Loan Parties or any Subsidiaries
of any Loan Party is subject to any other Federal state statute or
regulation limiting its ability to incur Indebtedness for borrowed
money.
6.1.20 Plans and Benefit Arrangements.
Except as set forth on Schedule 6.1.20:
(i) The Borrowers and each other member of the ERISA Group
are in compliance in all material respects with any applicable
provisions of ERISA with respect to all Benefit Arrangements,
Plans, Multiple Employer Plans and Multiemployer Plans. There has
been no Prohibited Transaction with respect to any Benefit
Arrangement or any Plan or, to the best knowledge of the
Borrowers, with respect to any Multiemployer Plan or Multiple
Employer Plan, which could result in any material liability of
the Borrower or any other member of the ERISA Group. The
Borrowers and all other members of the ERISA Group have made when
due any and all payments required to be made under any agreement
relating to a Multiemployer Plan or a Multiple Employer Plan or
any Law pertaining thereto. With respect to each Plan and
Multiemployer Plan, the Borrower and each other member of the
ERISA Group (i) have fulfilled in all material respects their
obligations under the minimum funding standards of ERISA, (ii)
have not incurred any liability to the PBGC, and (iii) have not
had asserted against them any penalty for failure to fulfill the
minimum funding requirements of ERISA.
(ii) To the best of the Borrowers' knowledge, each
Multiemployer Plan and Multiple Employer Plan is able to pay
benefits thereunder when due.
(iii)Neither the Borrowers nor any other member of the ERISA
Group has instituted or intends to institute proceedings to
terminate any Plan.
41
(iv) No event requiring notice to the PBGC under Section
302(0(4)(A) of ERISA has occurred or is reasonably expected to
occur with respect to any Plan, and no amendment with respect to
which security is required under Section 307 of ERISA has been
made or is reasonably expected to be made to any Plan.
(v) The aggregate actuarial present value of all benefit
liabilities (whether or not vested) under each Plan, determined
on a plan termination basis, as disclosed in, and as of the date
of, the most recent actuarial report for such Plan, does not
exceed the aggregate fair market value of the assets of such
Plan.
(vi) Neither the Borrowers nor any other member of the ERISA
Group has incurred or reasonably expects to incur any material
withdrawal liability under ERISA to any Multiemployer Plan or
Multiple Employer Plan. Neither the Borrowers nor any other
member of the ERISA Group has been notified by any Multiemployer
Plan or Multiple Employer Plan that such Multiemployer Plan or
Multiple Employer Plan has been terminated within the meaning of
Title IV of ERISA and, to the best knowledge of the Borrowers, no
Multiemployer Plan or Multiple Employer Plan is reasonably
expected to be reorganized or terminated, within the meaning of
Title IV of ERISA.
(vii)To the extent that any Benefit Arrangement is insured,
the Borrower and all other members of the ERISA Group have paid
when due all premiums required to be paid for all periods through
the Closing Date. To the extent that any Benefit Arrangement is
funded other than with insurance, the Borrower and all other
members of the ERISA Group have made when due all contributions
required to be paid for all periods through the Closing Date.
(viii) All Plans, Benefit Arrangements, Multiple Employer
Plans and Multiemployer Plans have been administered in material
compliance with their terms and applicable Law.
6.1.21 Employment Matters.
Each of the Loan Parties and each of their Subsidiaries is in
compliance with the Labor Contracts and all applicable federal, state
and local labor and employment Laws including those related to equal
employment opportunity and affirmative action, labor relations,
minimum wage, overtime, child labor, medical insurance continuation,
worker adjustment and relocation notices, immigration controls and
worker and unemployment compensation, where the failure to comply
would constitute a Material Adverse Change. There are no outstanding
grievances, arbitration awards or appeals therefrom arising out of the
Labor Contracts or current or threatened strikes, picketing,
handbilling or other work stoppages or slowdowns at facilities of any
of the Loan Parties which in any case would constitute a Material
Adverse Change.
42
6.1.22 Environmental Matters.
Except as disclosed on Schedule 6.1.22 and except for (i)
individual matters involving in any one (1) year liabilities,
expenditures or other dollar amounts not in excess of one and one
quarter percent (1.25%) of the Parent's consolidated assets or (ii)
matters which do not constitute or would not cause a Material Adverse
Change:
(i) None of the Loan Parties has received any Environmental
Complaint from any Official Body or private Person alleging that
such Loan Party or any prior or subsequent owner of any of the
Property is a potentially responsible party under the
Comprehensive Environmental Response, Cleanup and Liability Act,
42 U.S.C. section 960 1, et IM. with respect to the Property, and
none of the Loan Parties reasonably believes that such an
Environmental Complaint is likely to be received. There are no
pending or, to any Loan Party's knowledge, Environmental
Complaints which have been threatened in writing to any Loan
Party or, to any Loan Party's knowledge, any prior or subsequent
owner of any of the Property pertaining to, or arising out of,
any Environmental Conditions on or at the Property.
(ii) To any Loan Party's knowledge, there are no
circumstances at, on or under any of the Property that constitute
a violation of or non-compliance with any of the Environmental
Laws by any Loan Party, and there are no past or present
Environmental Conditions at, on or under any of the Property or,
to any Loan Party's knowledge, at, on or under adjacent property,
that prevent compliance by any Loan Party with the Environmental
Laws at any of the Property.
(iii)To any Loan Party's knowledge, neither any of the
Property nor any structures, improvements, equipment, fixtures,
activities or facilities thereon or thereunder contain or use
Regulated Substances except in compliance with Environmental
Laws. To any Loan Party's knowledge, there are no processes,
facilities, operations, equipment or other activities at, on or
under any of the Property, or, to any Loan Party's knowledge, at,
on or under adjacent property, that currently result in the
release or threatened release of Regulated Substances onto any of
the Property, except to the extent that such releases or
threatened releases are not a breach of or otherwise not a
violation by any Loan Party of the Environmental Laws.
(iv) There are no aboveground storage tanks, underground
storage tanks or underground piping associated with such tanks,
used for the management of Regulated Substances by the Loan
Parties at, on or under any of the Property that (a) do not have,
to the extent required by Environmental Laws, a full operational
secondary containment system in place, and (b) are not otherwise
in compliance with all Environmental Laws. There are no abandoned
underground storage tanks or underground piping associated with
such tanks, previously used for the management of Regulated
Substances by any Loan Party at, on or under any of the Property
that have not either been closed in place in accordance with
Environmental Laws or removed in compliance with all applicable
Environmental Laws and, to any Loan Party's knowledge, no
contamination associated with the use of such tanks exists on any
of the Property that requires remediation by any Loan Party under
any applicable Environmental Laws.
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(v) Each Loan Party has all material permits, licenses,
authorizations, plans and approvals necessary under the
Environmental Laws for the conduct of the business of such Loan
Party as presently conducted. Each Loan Party has submitted all
material notices, reports and other filings required by the
Environmental Laws to be submitted to an Official Body which
pertain to current operations on any of the Property by such Loan
Party.
(vi) To any Loan Party's knowledge, all present on-site
generation, storage, processing, treatment, recycling,
reclamation, disposal or other use or management of Regulated
Substances by the Loan Parties at, on, or under any of the
Property and all off-site transportation, storage, processing,
treatment, recycling, reclamation, disposal or other use or
management of Regulated Substances generated by the Loan Parties
have been done in accordance with the Environmental Laws.
6.1.23 Senior Debt Status.
The Obligations of each Loan Party under this Agreement, the
Notes, the Guaranty Agreement and each of the other Loan Documents to
which it is a party do rank and will rank at least pari passu in
priority of payment with all other Indebtedness of such Loan Party
except Indebtedness of such Loan Party to the extent secured by
Permitted Liens. There is no Lien upon or with respect to any of the
properties or income of any Loan Party or Subsidiary of any Loan Party
which secures indebtedness or other obligations of any Person except
for Permitted Liens.
7. CONDITIONS OF LENDING
The obligation of each Bank to make Loans and of the Agent to
issue Letters of Credit hereunder is subject to the performance by
each of the Loan Parties of its Obligations to be performed hereunder
at or prior to the making of any such Loans or issuance of such
Letters of Credit and to the satisfaction of the following further
conditions:
7.1 First Loans.
On the Closing Date:
7.1.1 Officer's Certificate.
The representations and warranties of each of the Loan Parties
contained in Section 6 and in each of the other Loan Documents shall be
true and accurate on and as of the Closing Date with the same effect as
though such representations and warranties had been made on and as of such
date (except representations and warranties which relate solely to an
earlier date or time, which representations and warranties shall be true
and correct on and as of the specific dates or times referred to therein),
and each of the Loan Parties shall have performed and complied with all
covenants and conditions hereof and thereof, no Event of Default or
Potential Default shall have occurred and be continuing or shall exist; and
there shall be delivered to the
44
Agent for the benefit of each Bank a certificate of each of the Loan
Parties, dated the Closing Date and signed by the Chief Executive Officer,
President or Chief Financial Officer of each of the Loan Parties, to each
such effect.
7.1.2 Secretary's Certificate.
There shall be delivered to the Agent for the benefit of each Bank a
certificate dated the Closing Date and signed by the Secretary or an
Assistant Secretary of each of the Loan Parties, certifying as appropriate
as to:
(i) all action taken by each Loan Party in connection with this
Agreement and the other Loan Documents;
(ii) the names of the officer or officers authorized to sign this
Agreement and the other Loan Documents and the true signatures of such
officer or officers and specifying the Authorized Officers permitted
to act on behalf of each Loan Party for purposes of this Agreement and
the true signatures of such officers, on which the Agent and each Bank
may conclusively rely; and
(iii)copies of its organizational documents, including its
certificate of incorporation, bylaws, certificate of limited
partnership, partnership agreement, certificate of formation, and
limited liability company agreement as in effect on the Closing Date
certified by the appropriate state official where such documents are
filed in a state office together with certificates from the
appropriate state officials as to the continued existence and good
standing of each Loan Party (dated not earlier than thirty (30) days
before the Closing Date) in each state where organized.
7.1.3 Delivery of Loan Documents.
The Guaranty Agreement, Notes, Intercompany Subordination Agreement
and other Loan Documents shall have been duly executed and delivered to the
Agent for the benefit of the Banks.
7.1.4 Opinion of Counsel.
There shall be delivered to the Agent for the benefit of each Bank a
written opinion of Dechert, Price & Xxxxxx, counsel for the Loan Parties
(who may rely on the opinions of such other counsel as may be acceptable to
the Agent), dated the Closing Date and in form and substance satisfactory
to the Agent and its counsel as to such matters incident to the
transactions contemplated herein as the Agent may reasonably request.
7.1.5 Legal Details.
All legal details and proceedings in connection with the transactions
contemplated by this Agreement and the other Loan Documents shall be in
form and substance
45
satisfactory to the Agent and counsel for the Agent, and the Agent shall
have received all such other counterpart originals or certified or other
copies of such documents and proceedings in connection with such
transactions, in form and substance satisfactory to the Agent and said
counsel, as the Agent or said counsel may reasonably request.
7.1.6 Payment of Fees.
The Borrower shall have paid or caused to be paid to the Agent for
itself and for the account of the Banks to the extent not previously paid
the Closing Fees, all other commitment and other fees accrued through the
Closing Date and the costs and expenses for which the Agent and the Banks
are entitled to be reimbursed.
7.1.7 Lien Searches and Fleet Payoff.
The Borrowers shall have delivered UCC, judgment and tax lien search
concerning the Loan Parties which are satisfactory to the Agent as to form,
content and scope and all outstanding obligations of all Loan Parties owing
to Fleet Financial Corp. shall be paid and satisfied in full, all liens
released and all releases, UCC-3 termination statements, mortgage
satisfactions and other lien release documents shall have been executed and
delivered on the Closing Date.
7.1.8 [RESERVED].
7.1.9 Consents.
All material consents required to effectuate the transactions
contemplated hereby as set forth on Schedule 6.1.13 shall have been
obtained.
7.1.10 Officer's Certificate Regarding, MACS.
Since December 31, 1996, no Material Adverse Change shall have
occurred; prior to the Closing Date, there shall have been no material
change in the management of any Loan Party or Subsidiary of any Loan Party;
and there shall have been delivered to the Agent for the benefit of each
Bank a certificate dated the Closing Date and signed by the Chief Executive
Officer, President or Chief Financial Officer of each Loan Party to each
such effect.
7.1.11 No Violation of Laws.
The making of the Loans and the issuance of the Letters of Credit
shall not contravene any Law applicable to any Loan Party or any of the
Banks.
7.1.12 No Actions or Proceedings.
No action, proceeding, investigation, regulation or legislation shall
have been instituted, threatened or proposed before any court, governmental
agency or legislative body to enjoin, restrain or prohibit, or to obtain
damages in respect of, this Agreement, the other
46
Loan Documents or the consummation of the transactions contemplated hereby
or thereby or which, in the Agent's sole discretion, would make it
inadvisable to consummate the transactions contemplated by this Agreement
or any of the other Loan Documents.
7.1.13 Insurance Policies-, Certificates of Insurance; Endorsements.
The Loan Parties shall have delivered evidence acceptable to the Agent
that adequate insurance in compliance with Section 8.1.3 is in full force
and effect and that all premiums then due thereon have been paid, together
with a certified copy of each Loan Party's casualty insurance policy or
policies evidencing coverage reasonably satisfactory to the Agent.
7.2 Each Additional Loan.
At the time of making any Loans or issuing any Letters of Credit other than
Loans made or Letters of Credit issued on the Closing Date and after giving
effect to the proposed extensions of credit: the representations and warranties
of the Loan Parties contained in Section 6 and in the other Loan Documents,
including the Schedules thereto, shall be true on and as of the date of such
additional Loan or Letter of Credit with the same effect as though such
representations and warranties had been made, and such Schedules delivered, on
and as of such date (except representations and warranties which expressly
relate solely to an earlier date or time, which representations and warranties
shall be true and correct on and as of the specific dates or times referred to
therein) and the Loan Parties shall have performed and complied with all
covenants and conditions hereof, no Event of Default or Potential Default shall
have occurred and be continuing or shall exist; the making of the Loans or
issuance of such Letter of Credit shall not contravene any Law applicable to any
Loan Party or Subsidiary of any Loan Party or any of the Banks; and the Borrower
shall have delivered to the Agent a duly executed and completed Loan Request or
application for a Letter of Credit as the case may be.
8. COVENANTS
8.1 Affirmative Covenants.
The Loan Parties, jointly and severally, covenant and agree that until
payment in full of the Loans, Reimbursement Obligations and Letter of Credit
Borrowings, and interest thereon, expiration or termination of all Letters of
Credit, satisfaction of all of the Loan Parties' other Obligations under the
Loan Documents and termination of the Commitments, the Loan Parties shall comply
at all times with the following affirmative covenants:
8.1.1 Preservation of Existence, Etc.
Each Loan Party shall, and shall cause each of its Subsidiaries to,
maintain its legal existence as a corporation, limited partnership or
limited liability company and its license or qualification and good
standing in each jurisdiction in which its ownership or lease of
47
property or the nature of its business makes such license or qualification
necessary, except as otherwise expressly permitted in Section 8.2.6.
8.1.2 Payment of Liabilities, Including, Taxes, Etc.
Each Loan Party shall, and shall cause each of its Subsidiaries to,
duly pay and discharge all liabilities to which it is subject or which are
asserted against it, promptly as and when the same shall become due and
payable, including all taxes, assessments and governmental charges upon it
or any of its properties, assets, income or profits, prior to the date on
which penalties attach thereto, except to the extent that such liabilities,
including taxes, assessments or charges, are being contested in good faith
and by appropriate and lawful proceedings diligently conducted and for
which such reserve or other appropriate provisions, if any, as shall be
required by GAAP shall have been made, but only to the extent that failure
to discharge any such liabilities would not result in any additional
liability which would adversely affect to a material extent the financial
condition of the Loan Parties taken as a whole or which would affect in a
materially adverse manner the material property of the Borrowers; provided
that the Loan Parties and their Subsidiaries will pay all such liabilities
forthwith upon the commencement of proceedings to foreclose any Lien which
may have attached as security therefor.
8.1.3 Maintenance of Insurance.
Each Loan Party shall, and shall cause each of its Subsidiaries to,
insure its properties and assets against loss or damage by fire and such
other insurable hazards as such assets are commonly insured (including
fire, extended coverage, property damage, workers' compensation, public
liability and business interruption insurance) and against other risks
(including errors and omissions) in such amounts as similar properties and
assets are insured by prudent companies in similar circumstances carrying
on similar businesses, and with reputable and financially sound insurers,
including self-insurance to the extent customary. At the request of the
Agent, the Loan Parties shall deliver to the Agent and each of the Banks
from time to time a summary schedule indicating all insurance then in force
with respect to each of the Loan Parties.
8.1.4 Maintenance of Properties and Leases.
Each Loan Party shall, and shall cause each of its Subsidiaries to,
maintain in good repair, working order and condition (ordinary wear and
tear excepted) in accordance with the general practice of other businesses
of similar character and size, all of those properties useful or necessary
to its business, and from time to time, such Loan Party will make or cause
to be made all appropriate repairs, renewals or replacements thereof.
8.1.5 Maintenance of Patents, Trademarks, Etc.
Each Loan Party shall, and shall cause each of its Subsidiaries to,
maintain in full force and effect all patents, trademarks, service marks,
trade names, copyrights, licenses, franchises, permits and other
authorizations necessary for the ownership and operation of its
48
properties and business if the failure so to maintain the same would
constitute a. Material Adverse Change.
8.1.6 Visitation Rights.
Each Loan Party shall, and shall cause each of its Subsidiaries to,
permit any of the officers or authorized employees or representatives of
the Agent or any of the Banks to visit and inspect any of its properties
and to examine and make excerpts from its books and records and discuss its
business affairs, finances and accounts with its officers, all in such
detail and at such times and as often as any of the Banks may reasonably
request, provided that each Bank shall provide the Borrowers and the Agent
with reasonable notice prior to any visit or inspection.
8.1.7 Keeping of Records and Books of Account.
The Borrowers shall maintain and keep proper books of record and
account which enable the Borrowers, or the Loan Parties, as the case may
be, to issue financial statements in accordance with GAAP and as otherwise
required by applicable Laws of any Official Body having jurisdiction over
the Borrowers and in which full, true and correct entries shall be made in
all material respects of all its dealings and business and financial
affairs.
8.1.8 Plans and Benefit Arrangements.
The Borrower shall, and shall cause each other member of the ERISA
Group to, comply with ERISA, the Internal Revenue Code and other applicable
Laws applicable to Plans and Benefit Arrangements except where such
failure, alone or in conjunction with any other failure, would not result
in a Material Adverse Change. Without limiting the generality of the
foregoing, the Borrowers shall cause all their Plans and all Plans
maintained by any member of the ERISA Group to be funded in accordance with
the minimum funding requirements of ERISA and shall make, and cause each
member of the ERISA Group to make, in a timely manner, all contributions
due to Plans, Benefit Arrangements, Multiple Employer Plans and
Multiemployer Plans.
8.1.9 Compliance with Laws.
Each Loan Party shall comply with all applicable Laws, including all
Environmental Laws, in all respects, provided that it shall not be deemed
to be a violation of this Section 8.1.9 if any failure to comply with any
Law would not result in fines, penalties, remediation costs, other similar
liabilities or injunctive relief which in the aggregate would constitute a
Material Adverse Change.
49
8.1.10 Use of Proceeds.
8.1.10.1 General.
The Loan Parties will use the Letters of Credit and the proceeds
of the Loans only for (i) general corporate purposes and for working
capital, (ii) to finance Permitted Acquisitions, or (iii) to repay and
terminate Indebtedness outstanding under the Loan and Security
Agreement dated March 31, 1993 between the Company and Fleet Capital
Corporation (successor in interest to Xxxxxxx'x Business Credit,
Inc.), as amended. The Loan Parties shall not use the Letters of
Credit and the proceeds of the Loans for any purposes which
contravenes any applicable Law or any provision hereof.
8.1.10.2 Margin Stock.
The Loan Parties shall not use the proceeds of the Loans to
purchase margin stock as more fully provided in Section 6. 1. I 0.
8.1.10.3 Section 20 Subsidiaries.
The Loan Parties will not, directly or indirectly, use any
portion of the proceeds of the Loans (i) knowingly to purchase any
Ineligible Securities from a Section 20 Subsidiary during any period
in which such Section 20 Subsidiary makes a market in such Ineligible
Securities, (ii) knowingly to purchase during the underwriting or
placement period Ineligible Securities being underwritten or privately
placed by a Section 20 Subsidiary, or (iii) to make payments of
principal or interest on Ineligible Securities underwritten or
privately placed by as Section 20 Subsidiary and issued by or for the
benefit of any Loan Party or any Affiliate of any Loan Party.
8.1.11 Further Assurances.
Each Loan Party shall, from time to time, at its expense, do such acts
and things as the Agent in its sole discretion may deem necessary or
advisable from time to time in order to exercise and enforce its rights and
remedies thereunder.
8.1.12 Subordination of Intercompany Loans.
Each Loan Party shall cause any intercompany Indebtedness, loans or
advances owed by any Loan Party to any other Loan Party to be subordinated
pursuant to the terms of the Intercompany Subordination Agreement.
8.2 Negative Covenants.
The Loan Parties, jointly and severally, covenant and agree that until
payment in full of the Loans, Reimbursement Obligations and Letter of Credit
Borrowings and interest thereon, expiration or termination of all Letters of
Credit, satisfaction of all of the Loan Parties'
50
other Obligations hereunder and termination of the Commitments, the Loan Parties
shall comply with the following negative covenants:
8.2.1 Indebtedness.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, at any time create, incur, assume or suffer to exist any
Indebtedness, except:
(i) Indebtedness under the Loan Documents;
(ii) Existing Indebtedness as set forth on Schedule 8.2.1
(including any extensions or renewals thereof, provided there is no
increase in the amount thereof or other significant change in the
terms thereof unless otherwise specified on Schedule 8.2. 1;
(iii) Capitalized and operating leases as and to the extent
permitted under Section 8.2.15;
(iv) Indebtedness secured by Purchase Money Security Interests
not exceeding the amount set forth in clause (ix) of the definition of
Permitted Liens;
(v) Indebtedness of a Loan Party to another Loan Party which is
subordinated in accordance with the provisions of Section 8.1.12;
(vi) Indebtedness not exceeding $2,000,000 in the aggregate
secured by Liens described under clause (xi) of the definition of
Permitted Liens; and
(vii) (A) $2,000,000 of unsecured seller debt subordinated to the
Obligations and (B) other seller debt subordinated on terms acceptable
to Required Banks having a maturity not earlier than, and on which no
interest or principal payments may be made before, 366 days after the
Expiration Date and having an aggregate principal amount not in excess
of $4,000,000 minus the principal amount of seller debt referred to in
clause (A) hereof.
8.2.2 Liens.
Each of the Loan Parties shall not, and shall not (x) permit any of
its Subsidiaries to, at any time create, incur, assume or suffer to exist
any Lien on any of its property or assets, tangible or intangible, now
owned or hereafter acquired, or agree or become liable to do so, except
Permitted Liens or (y) provide to any Person other than the Agent and the
Banks a 'negative pledge" or other promise or undertaking to keep its
property free of Liens, claims or encumbrances other than with respect to
property on which Liens are permitted pursuant to clauses (ix) and (xi) of
the definition of Permitted Liens.
8.2.3 Guaranties.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, at any time, directly or indirectly, become or be liable
in respect of any Guaranty,
51
or assume, guarantee, become surety for, endorse or otherwise agree, become
or remain directly or contingently liable upon or with respect to any
obligation or liability of any other Person, except for Guaranties of
Indebtedness of the Loan Parties permitted hereunder or, subject to the
limitations set forth in Section 8.2.20, Guaranties of Persons in which
investments are permitted under Section 8.2.9.
8.2.4 Loans and Investments.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, at any time make or suffer to remain outstanding any loan
or advance to, or purchase, acquire or own any stock, bonds, notes or
securities of, or any partnership interest (whether general or limited) or
limited liability company interest in, or any other investment or interest
in, or make any capital contribution to, any other Person, or agree, become
or remain liable to do any of the foregoing, except,
(i) trade credit extended on usual and customary terms in the
ordinary course of business;
(ii) advances to employees to meet expenses incurred by such
employees in the ordinary course of business;
(iii) Permitted Investments;
(iv) loans, advances and investments in other Loan Parties;
(v) investments permitted under Sections 8.2.6 and 8.2.9; and
(vi) investments in Persons engaged in a business described in
Section 8.2.10 provided that if such Persons are not Loan Parties,
then such investments shall be subject to the limitations set forth in
Section 8.2.20.
8.2.5 Dividends and Related Distributions.
While any Event of Default exists, each of the Loan Parties shall not,
and shall not permit any of its Subsidiaries to, make or pay, or agree to
become or remain liable to make or pay, any dividend or other distribution
of any nature (whether in cash, property, securities or otherwise) on
account of or in respect of its shares of capital stock, partnership
interests or limited liability company interests on account of the
purchase, redemption, retirement or acquisition of its shares of capital
stock (or warrants, options or rights therefor), partnership interests or
limited liability company interests, except dividends or other
distributions payable to another Loan Party.
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8.2.6 Liquidations, Mergers, Consolidations, Acquisitions.
Each of the Loan Parties shall not, and shall not pen-nit any of its
Subsidiaries to, dissolve, liquidate or wind-up its affairs, or become a
party to any merger or consolidation, or acquire by purchase, lease or
otherwise all or substantially all of the assets or capital stock of any
other Person, provided that
(1) any Loan Party may consolidate or merge into another Loan Party
which is wholly-owned by one or more of the other Loan Parties, and
(2) any Borrower may acquire, whether by purchase or by merger, (A)
all of the ownership interests of another Person or (B) substantially all
of assets of another Person or of a business or division of another Person
(each an "Permitted Acquisition"), provided that each of the following
requirements is met:
(i) such Person has had for the prior fiscal year positive
operating income (calculated in accordance with GAAP);
(ii) the Company demonstrates to the Banks pro forma covenant
compliance over the next four (4) quarter period taking into account
the projected Total Debt immediately following such acquisitions;
(iii) if the Loan Parties are acquiring the ownership interests
in such Person, such Person shall execute a Joinder and join this
Agreement as a Borrower pursuant to, and otherwise comply with,
Section II. 1 8 on or before the date of such Permitted Acquisition
(unless it is subject to the provisions of clause (xi) hereof,
(iv) the board of directors or other equivalent governing body of
such Person shall have approved such Permitted Acquisition and the
Company shall have delivered to the Banks written evidence of such
approval prior to such Permitted Acquisition;
(v) the business acquired, or the business conducted by the
Person whose ownership interests are being acquired, as applicable,
shall be substantially the same as one or more line or lines of
business conducted by the Borrowers and shall comply with Section 8.2.
1 0;
(vi) no Potential Default or Event of Default shall exist
immediately prior to and after giving effect to such Permitted
Acquisition;
(vii) the Company shall demonstrate that the Loan Parties shall
be in compliance with the covenants contained in Sections 8.2.15,
8.2.16 and 8.2.17 after giving effect to such Permitted Acquisition by
delivering at least thirty (30) Business Days prior to such Permitted
Acquisition a certificate in the form of Exhibit 8.2.6 evidencing such
compliance;
53
(viii) the Consideration paid by the Borrowers for such
Acquisition shall not exceed $8,000,000 and after giving effect to
such acquisition, the Consideration paid by the Loan Parties for all
Permitted Acquisitions made during the current fiscal year of the Loan
Parties shall not exceed an amount equal to (x) $16,000,000 less (y)
any amount added to the Outside Investment Amount in such fiscal year,
unless Required Banks shall, in their sole discretion, consent to the
payment of more Consideration;
(ix) the Company shall demonstrate, on a pro forma basis after
giving effect to such acquisition, availability under the Commitments
of not less than $2,500,000;
(x) if the Consideration to be paid in any acquisition exceeds
$2,500,000, then the Company shall have delivered to the Agent
financial statements of the Person acquired within sixty (60) days
following such acquisition; and
(xi) if the Person acquired therein will not be a Subsidiary
after the acquisition, then the Consideration paid in such acquisition
shall be subject to the limitation set forth in Section 8.2.20.
8.2.7 Dispositions of Assets or Subsidiaries.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, sell, convey, assign, lease, abandon or otherwise transfer
or dispose of, voluntarily or involuntarily, any of its properties or
assets, tangible or intangible (including sale, assignment, discount or
other disposition of accounts, contract rights, chattel paper, equipment or
general intangibles with or without recourse or of capital stock, shares of
beneficial interest, partnership interests or limited liability company
interests of a Subsidiary of such Loan Party), except:
(i) transactions involving the sale of inventory in the ordinary
course of business;
(ii) any sale, transfer or lease of assets in the ordinary course
of business which are no longer necessary or required in the conduct
of such Loan Party's or such Subsidiary's business;
(iii) (A) any sale, transfer or lease of assets by any wholly
owned Subsidiary of such Loan Party to another Loan Party or, (B)
subject to the limitations set forth in Section 8.2.20, to any
Subsidiary which is not a Borrower or any Person in which the
Borrowers are permitted to invest under Section 8.2.9;
(iv) any sale, transfer or lease of assets in the ordinary course
of business which are replaced by substitute assets acquired or leased
within the parameters of Section 8.2.15; and
54
(v) sales of assets acquired pursuant to a transaction permitted
pursuant to Section 8.2.6 if such sale was reflected in the pro forma
calculations provided by the Borrowers to the Agent in connection with
such acquisition.
8.2.8 Affiliate Transactions.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, enter into or carry out any transaction (including
purchasing property or services from or selling property or services to any
Affiliate of any Loan Party or other Person) unless such transaction is not
otherwise prohibited by this Agreement, is entered into in the ordinary
course of business upon fair and reasonable arm's-length terms and
conditions which are fully disclosed to the Agent and is in accordance with
all applicable Law.
8.2.9 Subsidiaries, Partnerships and Joint Ventures.
Each of the Loan Parties shall not, and the Parent shall not permit
any of its Subsidiaries to, own or create directly or indirectly any
Subsidiaries other than (i) any Subsidiary which has joined this Agreement
as a Borrower on the Closing Date and (ii) any Subsidiary formed after the
Closing Date which joins this Agreement as a Borrower pursuant to Section
11.18. Each of the Loan Parties shall not become or agree to (1) become a
general or limited partner in any general or limited partnership, except
that the Loan Parties may be general or limited partners in other Loan
Parties, (2) become a member or manager of, or hold a limited liability
company interest in, a limited liability company, except that the Loan
Parties may be members or managers of, or hold limited liability company
interests in, other Loan Parties, or (3) become a joint venturer or hold a
joint venture interest in any joint venture or any Subsidiary which is not
a Borrower so long as any transaction described in clauses (1), (2) and (3)
shall be subject to the limitations set forth in Section 8.2.20.
8.2.10 Continuation of or Change in Business.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, engage in any business other than activities within the
scope of SIC codes beginning with "356", "362","336", "3321" or "3322",
substantially as conducted and operated by such Loan Party or Subsidiary
during the present fiscal year, and such Loan Party or Subsidiary shall not
permit any material change in such business.
8.2.11 Plans and Benefit Arrangements.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to:
(i) fail to satisfy the minimum funding requirements of ERISA and
the Internal Revenue Code with respect to any Plan;
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(ii) request a minimum funding waiver from the Internal Revenue
Service with respect to any Plan;
(iii) engage in a Prohibited Transaction with any Plan, Benefit
Arrangement, Multiple Employer Plan or Multiemployer Plan which, alone
or in conjunction with any other circumstances or set of circumstances
resulting in liability under ERISA, would constitute a Material
Adverse Change;
(iv) permit the aggregate actuarial present value of all benefit
liabilities (whether or not vested) under each Plan, determined on a
plan termination basis, as disclosed in the most recent actuarial
report completed with respect to such Plan, to exceed, as of any
actuarial valuation date, the fair market value of the assets of such
Plan;
(v) fail to make when due any contribution to any Multiemployer
Plan that the Borrower or any member of the ERISA Group may be
required to make under any agreement relating to such Multiemployer
Plan, or any Law pertaining thereto;
(vi) withdraw (completely or partially) from any Multiemployer
Plan or withdraw (or be deemed under Section 4062(e) of ERISA to
withdraw) from any Multiple Employer Plan, where any such withdrawal
is likely to result in a material liability of the Borrower or any
member of the ERISA Group;
(vii) terminate, or institute proceedings to terminate, any Plan,
where such termination is likely to result in a material liability to
the Borrower or any member of the ERISA Group;
(viii) make any amendment to any Plan with respect to which
security is required under Section 307 of ERISA: or
(ix) fail to give any and all notices and make all disclosures
and governmental filings required under ERISA or the Internal Revenue
Code, where such failure is reasonably likely to result in a Material
Adverse Change.
8.2.12 Fiscal Year.
The Borrowers shall not change their fiscal year from the twelve-month
period on the Friday closest to December 31.
8.2.13 Issuance of Stock.
Each of the Borrowers shall not, and shall not permit any of its
Subsidiaries to, issue any additional shares of its capital stock or any
options, warrants or other rights in respect thereof except that a Loan
Party may issue such property to any other Loan Party.
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8.2.14 Changes in Organizational Documents.
Each of the Borrowers shall not amend in any respect its certificate
of incorporation (including any provisions or resolutions relating to
capital stock), bylaws, certificate of limited partnership, partnership
agreement, certificate of formation, limited liability company agreement or
other organizational documents without providing at least forty-five (45)
calendar days' prior written notice to the Agent and the Banks and, in the
event such change would be adverse to the Banks as determined by the Agent
in its sole discretion, obtaining the prior written consent of the Required
Banks.
8.2.15 Capital Expenditures and Leases.
Each of the Loan Parties shall not, and shall not permit any of the
Parent's Subsidiaries to, make any payments on account of the purchase or
lease of any assets which if purchased would constitute fixed assets the
amount of which (when measured over the term of such lease or any
applicable purchase agreement without taking into account any interest
component) exceeds 250% of the Loan Parties' depreciation expenses for the
prior fiscal year (the "Permitted Amount") in the aggregate in any fiscal
year; provided that any portion of the Permitted Amount which exceeds the
amount of such payments made in any fiscal year shall be applied to
increase the Permitted Amount for the immediately following fiscal year and
provided that all such capital expenditures and leases shall be made under
usual and customary terms and in the ordinary course of business. The
Consideration paid in a Permitted Acquisition shall not be included in, or
applied to reduce, the Permitted Amount and the depreciation expense of
Persons whose financial results are set forth in audited financial
statements delivered to the Agent and the Banks and who are acquired in
Permitted Acquisitions shall be included in the calculation of the
Permitted Amount.
8.2.16 Minimum Interest Coverage Ratio.
The Loan Parties shall not permit the ratio of EBIT to consolidated
interest expense of the Borrowers calculated as of the end of each fiscal
quarter for the four fiscal quarters then ended, to be less than 2.5 to 1.0
8.2.17 Minimum Tangible Net Worth.
The Borrowers shall not at any time permit Consolidated Tangible Net
Worth to be less than the sum of $7,500,000 plus (x) 50% of consolidated
net income of the Borrowers for each fiscal year in which net income was
earned (as opposed to a net loss) during the period from December 31, 1995
through the date of determination minus (y) an amount not exceeding
$1,500,000 in 1996, $2,000,000 in 1997 or $2,500,000 in 1998 and 1999 equal
to the portion of Consideration paid since the Closing Date which
represents intangible assets, calculated and determined in accordance with
GAAP.
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8.2.18 Maximum Leverage Ratio.
The Borrowers shall not permit at any time their Leverage Ratio to
exceed 3.0 to 1.0.
8.2.19 Operating- Assets, Acquisitions.
Substantially all of the Loan Parties' operating assets which are not
represented by the Outside Investment Amount shall be owned by the
Borrowers. All Permitted Acquisitions which are not represented by the
Outside Investment Amount shall be made by a Borrower.
8.2.20 Outside Investment Limit.
The Loan Parties shall not permit at any time the Outside Investment
Amount to exceed the Outside Investment Limit.
8.3 Reporting Requirements.
The Loan Parties, jointly and severally, covenant and agree that '
until payment in full of the Loans, Reimbursement Obligations and Letter of
Credit Borrowings and interest thereon, expiration or termination of all
Letters of Credit, satisfaction of all of the Loan Parties' other
Obligations hereunder and under the other Loan Documents and termination of
the Commitments, the Loan Parties will furnish or cause to be furnished to
the Agent and each of the Banks:
8.3.1 [RESERVED]
8.3.2 Quarterly Financial Statements.
As soon as available and in any event within forty-five (45)
calendar days after the end of each of the first three fiscal quarters
in each fiscal year, financial statements of the Loan Parties
consisting of a consolidated and consolidating balance sheet as of the
end of such fiscal quarter and related consolidated and consolidating
statements of income, stockholders' equity and cash flows for the
fiscal quarter then ended and the fiscal year through that date, all
in reasonable detail and certified (subject to normal year-end audit
adjustments) by the Chief Executive Officer, President or Chief
Financial Officer of the Loan Parties as having been prepared in
accordance with GAAP, consistently applied, and setting forth in
comparative form the respective financial statements for the
corresponding date and period in the previous fiscal year.
8.3.3 Annual Financial Statements.
As soon as available and in any event within ninety (90) days
after the end of each fiscal year of the Loan Parties, financial
statements of the Loan Parties consisting of a consolidated and
consolidating balance sheet as of the end of such fiscal year, and
related
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consolidated and consolidating statements of income, stockholders'
equity and cash flows for the fiscal year then ended, all in
reasonable detail and setting forth in comparative form the financial
statements as of the end of and for the preceding fiscal year and, as
to the consolidated statements only, certified by Xxxxxx Xxxxxxxx LLP
or other independent certified public accountants of nationally
recognized standing. The certificate or report of accountants shall be
free of qualifications (other than any consistency qualification that
may result from a change in the method used to prepare the financial
statements as to which such accountants concur) and shall not indicate
the occurrence or existence of any event, condition or contingency
which would materially impair the prospect of payment or performance
of any covenant, agreement or duty of the Loan Parties taken as a
whole under any of the Loan Documents.
8.3.4 Certificate of the Borrower.
Concurrently with the financial statements furnished to the Agent
and to the Banks pursuant to Sections 8.3.1 and 8.3.3, a certificate
of the Loan Parties signed by the Chief Executive Officer, President
or Chief Financial Officer of the Borrowers, in the form of Exhibit
8.3.4, to the effect that, except as described pursuant to Section
8.3.5, (i) the representations and warranties of the Borrowers
contained in Section 6 and in the other Loan Documents are true on and
as of the date of such certificate with the same effect as though such
representations and warranties had been made on and as of such date
(except representations and warranties which expressly relate solely
to an earlier date or time) and the Loan Parties have performed and
complied with all covenants and conditions hereof, (ii) no Event of
Default or Potential Default exists and is continuing on the date of
such certificate and (iii) containing calculations in sufficient
detail to demonstrate compliance as of the date of such financial
statements with all financial covenants contained in Section 8.2.
8.3.5 Notice of Default.
Promptly after any officer of any Loan Party has learned of the
occurrence of an Event of Default or Potential Default, a certificate
signed by the Chief Executive Officer, President or Chief Financial
Officer of such Loan Party setting forth the details of such Event of
Default or Potential Default and the action which the such Loan Party
proposes to take with respect thereto.
8.3.6 Notice of Litigation.
Promptly after the commencement thereof, notice of all actions,
suits, proceedings or investigations before or by any Official Body or
any other Person against any Loan Party or Subsidiary of any Loan
Party which involve a claim or series of claims in excess of $500,000
or which if adversely determined would constitute a Material Adverse
Change.
8.3.7 Certain Events.
Written notice to the Agent:
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(i) at least thirty (30) calendar days prior thereto, with
respect to any Permitted Acquisition; or
(ii) within the time limits set forth in Section 8.2.14, any
amendment to the organizational documents of any Loan Party.
8.3.8 Budgets, Forecasts, Other Reports and Information.
Promptly upon their becoming available to the Borrowers:
(i) the annual budget and any forecasts or projections of
the Borrowers, to be supplied not later than sixty (60) days
prior to commencement of the fiscal year to which any of the
foregoing may be applicable,
(ii) any reports including management letters submitted to
the Borrowers or any Loan Party by independent accountants in
connection with any annual, interim or special audit,
(iii) any reports, notices or proxy statements generally
distributed by the Borrower or any Loan Party to its stockholders
on a date no later than the date supplied to such stockholders,
(iv) regular or periodic reports, including Forms 10-K, 10-Q
and 8-K, registration statements and prospectuses, filed by any
Loan Party with the Securities and Exchange Commission,
(v) a copy of any order in any proceeding to which any
Borrower is a party issued by any Official Body if such order
would result in a Material Adverse Change, and
(vi) such other reports and information as any of the Banks
may from time to time reasonably request. The Borrowers shall
also notify the Banks promptly of the enactment or adoption of
any Law which may result in a Material Adverse Change.
8.3.9 Notices Regarding- Plans and Benefit Arrangements.
8.3.9.1 Certain Events.
Promptly upon becoming aware of the occurrence thereof,
notice (including the nature of the event and, when known, any
action taken or threatened by the Internal Revenue Service or the
PBGC with respect thereto) of-
(i) any Reportable Event with respect to any Loan Party
or any other member of the ERISA Group (regardless of
whether the obligation to report said Reportable Event to
the PBGC has been waived),
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(ii) any Prohibited Transaction which could subject any
Loan Party or any other member of the ERISA Group to a
material civil penalty assessed pursuant to Section 502(i)
of ERISA or a material tax imposed by Section 4975 of the
Internal Revenue Code in connection with any Plan, Multiple
Employer Plan, Benefit Arrangement or any trust created
thereunder,
(iii) any assertion with respect to any Loan Party or
any other member of the ERISA Group, of material withdrawal
liability with respect to any Multiemployer Plan,
(iv) any partial or complete withdrawal from a
Multiemployer Plan by any Loan Party or any other member of
the ERISA Group under Title IV of ERISA (or assertion
thereof), where such withdrawal is likely to result in
material withdrawal liability,
(v) any cessation of operations (by any Loan Party or
any other member of the ERISA Group) at a facility in the
circumstances described in Section 4062(e) of ERISA,
(vi) withdrawal by any Loan Party or any other member
of the ERISA Group from a Multiple Employer Plan,
(vii) a failure by any Loan Party or any other member
of the ERISA Group to make a payment to a Plan required to
avoid imposition of a Lien under Section 302(f) of ERISA,
(viii) the adoption of an amendment to a Plan requiring
the provision of security to such Plan pursuant to Section
307 of ERISA, or
(ix) any change in the actuarial assumptions or funding
methods used for any Plan, where the effect of such change
is to materially increase or materially reduce the unfunded
benefit liability or obligation to make periodic
contributions.
8.3.9.2 Notices of Involuntary Termination and Annual
Reports.
Promptly after receipt thereof, copies of (a) all notices
received by the Borrowers or any other member of the ERISA Group
of the PBGC's intent to terminate any Plan administered or
maintained by the Borrowers or any member of the ERISA Group, or
to have a trustee appointed to administer any such Plan; and (b)
at the request of the Agent or any Bank each annual report (IRS
Form 5500 series) and all accompanying schedules, the most recent
actuarial reports, the most recent financial information
concerning the financial status of each Plan administered or
maintained by the Borrowers or any other member of the ERISA
Group, and schedules showing the amounts contributed to each such
Plan by or on behalf of the Borrower or any other member of the
ERISA Group in which any of their personnel participate
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or from which such personnel may derive a benefit, and each
Schedule B (Actuarial Information) to the annual report filed by
the Borrowers or any other member of the ERISA Group with the
Internal Revenue Service with respect to each such Plan.
8.3.9.3 Notice of Voluntary Termination.
Promptly upon the filing thereof, copies of any Form 5 3 1
0, or any successor or equivalent form to Form 5 3 1 0, filed
with the PBGC in connection with the termination of any Plan.
8.3.10 Material Venture Investments.
Concurrently with the financial statements furnished to the Agent
and to the Banks pursuant to Section 8.3.2 and 8.3.3, a report
describing all Material Venture Investments and concurrently with the
annual statements referred to in Section 8.3.3, the financial
statements and a budget (of the type described in Section 8.3.8) for
each Material Venture Investment.
9. DEFAULT
9.1 Events of Default.
An Event of Default shall mean the occurrence or existence of any one or
more of the following events or conditions (whatever the reason therefor and
whether voluntary, involuntary or effected by operation of Law):
9.1.1 Payments Under Loan Documents.
Any Borrower (x) shall fail to pay any principal of any Loan
(including scheduled installments, mandatory prepayments or the payment due
at maturity), Reimbursement Obligation or Letter of Credit Borrowing or (y)
shall fail to pay any interest on any Loan, Reimbursement Obligation or
Letter of Credit Borrowing when due in accordance with the terms hereof or
any other amount owing hereunder or under the other Loan Documents and such
failure to pay interest or other amount shall continue for three (3)
Business Days after such interest or other amount becomes due in accordance
with the terms hereof or thereof;
9.1.2 Breach of Warranty.
Any representation or warranty made at any time by any of the Loan
Parties herein or by any of the Loan Parties in any other Loan Document, or
in any certificate, other instrument or statement furnished pursuant to the
provisions hereof or thereof , including with respect to Section 6.1.9 and
irrespective of the actual knowledge of any Borrower, shall prove to have
been false or misleading in any material respect as of the time it was made
or furnished;
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9.1.3 Breach of Negative Covenants or Visitation Rights.
Any of the Loan Parties shall default in the observance or performance
of any covenant contained in Section 8.1.6 or Section 8.2;
9.1.4 Breach of Other Covenants.
Any of the Loan Parties shall default in the observance or performance
of any other covenant, condition or provision hereof or of any other Loan
Document and such default shall continue unremedied for a period of twenty
(20) Business Days after any officer of any Loan Party becomes aware of the
occurrence thereof (such grace period to be applicable only in the event
such default can be remedied by corrective action of the Loan Parties as
determined by the Agent in its sole discretion);
9.1.5 Defaults in Other Agreements or Indebtedness.
A default or event of default shall occur at any time under the terms
of any other agreement involving borrowed money or the extension of credit
or any other Indebtedness under which any Loan Party may be obligated as a
borrower or guarantor in excess of $500,000 in the aggregate, and such
breach, default or event of default consists of the failure to pay (beyond
any period of grace permitted with respect thereto, whether waived or not)
any indebtedness when due (whether at stated maturity, by acceleration or
otherwise) or if such breach or default pen-nits or causes the acceleration
of any indebtedness (whether or not such right shall have been waived) or
the termination of any commitment to lend;
9.1.6 Final Judgments or Orders.
Any final judgments or orders for the payment of money in excess of
$500,000 in the aggregate shall be entered against any Loan Party by a
court having jurisdiction in the premises, which judgment is not
discharged, vacated, bonded or stayed pending appeal within a period of
thirty (30) days from the date of entry;
9.1.7 Loan Document Unenforceable.
Any of the Loan Documents shall cease to be legal, valid and binding
agreements enforceable against the party executing the same or such party's
successors and assigns (as permitted under the Loan Documents) in
accordance with the respective terms thereof or shall in any way be
terminated (except in accordance with its terms) or become or be declared
ineffective or inoperative or shall in any way be challenged or contested
or cease to give or provide the respective Liens, security interests,
rights, titles, interests, remedies, powers or privileges intended to be
created thereby;
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9.1.8 Uninsured Losses; Proceedings Against Assets.
There shall occur any material uninsured damage to or loss, theft or
destruction of any of the Borrowers' tangible property in excess of $
1,000,000 or any other of the Loan Parties' or any of their Subsidiaries'
assets are attached, seized, levied upon or subjected to a writ or distress
warrant; or such come within the possession of any receiver, trustee,
custodian or assignee for the benefit of creditors and the same is not
cured within thirty (30) days thereafter;
9.1.9 Notice of Lien or Assessment.
A notice of Lien or assessment in excess of $500,000 which is not a
Permitted Lien is filed of record with respect to all or any part of any of
the Loan Parties' or any of their Subsidiaries' assets by the United
States, or any department, agency or instrumentality thereof, or by any
state, county, municipal or other governmental agency, including the PBGC,
or any taxes or debts owing at any time or times hereafter to any one of
these becomes payable and the same is not paid within thirty (30) days
after the same becomes payable;
9.1.10 Insolvency.
Any Loan Party or any Subsidiary of a Loan Party ceases to be solvent
or admits in writing its inability to pay its debts as they mature;
9.1.11 Events Relating to Plans and Benefit Arrangements.
Any of the following occurs: (i) any Reportable Event, which the Agent
determines in good faith constitutes grounds for the termination of any
Plan by the PBGC or the appointment of a trustee to administer or liquidate
any Plan, shall have occurred and be continuing; (ii) proceedings shall
have been instituted or other action taken to terminate any Plan, or a
termination notice shall have been filed with respect to any Plan; (iii) a
trustee shall be appointed to administer or liquidate any Plan; (iv) the
PBGC shall give notice of its intent to institute proceedings to terminate
any Plan or Plans or to appoint a trustee to administer or liquidate any
Plan; and, in the case of the occurrence of (i), (ii), (iii) or (iv) above,
the Agent determines in good faith that the amount of the Borrowers'
liability is likely to exceed 10% of their Tangible Net Worth; (v) any
Borrower or any member of the ERISA Group shall fail to make any
contributions when due to a Plan or a Multiemployer Plan; (vi) the Borrower
or any other member of the ERISA Group shall make any amendment to a Plan
with respect to which security is required under Section 307 of ERISA;
(vii) any Borrower or any other member of the ERISA Group shall withdraw
completely or partially from a Multiemployer Plan; (viii) any Borrower or
any other member of the ERISA Group shall withdraw (or shall be deemed
under Section 4062(e) of ERISA to withdraw) from a Multiple Employer Plan;
or (ix) any applicable Law is adopted, changed or interpreted by any
Official Body with respect to or otherwise affecting one or more Plans,
Multiemployer Plans or Benefit Arrangements and, with respect to any of the
events specified in (v), (vi), (vii), (viii) or (ix), the Agent determines
in good faith that
64
any such occurrence would be reasonably likely to materially and adversely
affect the total enterprise represented by the Borrowers and the other
members of the ERISA Group;
9.1.12 Cessation of Business.
Any Loan Party or Subsidiary of a Loan Party ceases to conduct its
business as contemplated, except as expressly permitted under Section 8.2.6
or 8.2.7, or any Loan Party or Subsidiary of a Loan Party is enjoined,
restrained or in any way prevented by court order from conducting all or
any material part of its business and such injunction, restraint or other
preventive order is not dismissed within thirty (30) days after the entry
thereof-,
9.1.13 Change of Control.
(i) Any person (other than Xxxxxx X. Xxxxx or a Permitted Transferee)
or group of persons (within the meaning of Sections 13(a) or 14(a) of the
Securities Exchange Act of 1934, as amended) shall have acquired beneficial
ownership of (within the meaning of Rule 13d-3 promulgated by the
Securities and Exchange Commission under said Act) 25% or more of the
voting capital stock of the Parent; or (ii) within a period of twelve (12)
consecutive calendar months, individuals who were directors of the Parent
on the first day of such period shall cease to constitute a majority of the
board of directors of the Parent;
9.1.14 Involuntary Proceedings.
A proceeding shall have been instituted in a court having jurisdiction
in the premises seeking a decree or order for relief in respect of any Loan
Party or Subsidiary of a Loan Party in an involuntary case under any
applicable bankruptcy, insolvency, reorganization or other similar law now
or hereafter in effect, or for the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator, conservator (or similar
official) of any Loan Party or Subsidiary of a Loan Party for any
substantial part of its property, or for the winding-up or liquidation of
its affairs, and such proceeding shall remain undismissed or unstayed and
in effect for a period of thirty (30) consecutive days or such court shall
enter a decree or order granting any of the relief sought in such
proceeding; or
9.1.15 Voluntary Proceedings.
Any Loan Party or Subsidiary of a Loan Party shall commence a
voluntary case under any applicable bankruptcy, insolvency, reorganization
or other similar law now or hereafter in effect, shall consent to the entry
of an order for relief in an involuntary case under any such law, or shall
consent to the appointment or taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator, conservator (or other similar
official) of itself or for any substantial part of its property or shall
make a general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due, or shall take any action in
furtherance of any of the foregoing.
65
9.2 Consequences of Event of Default.
9.2.1 Events of Default Other Than Bankruptcy, Insolvency or
Reorganization Proceedings.
If an Event of Default specified under Sections 9.1.1 through 9.1.13
shall occur and be continuing, the Banks and the Agent shall be under no
further obligation to make Loans or issue Letters of Credit, as the case
may be, and the Agent may, and upon the request of the Required Banks,
shall (i) by written notice to the Borrowers, declare the unpaid principal
amount of the Notes then outstanding and all interest accrued thereon, any
unpaid fees and all other Indebtedness of the Borrowers to the Banks
hereunder and thereunder to be forthwith due and payable, and the same
shall thereupon become and be immediately due and payable to the Agent for
the benefit of each Bank without presentment, demand, protest or any other
notice of any kind, all of which are hereby expressly waived, and (ii)
require the Borrowers to, and the Borrowers shall thereupon, deposit in a
non-interest bearing account with the Agent, as cash collateral for its
Obligations under the Loan Documents, an amount equal to the maximum amount
currently or at any time thereafter available to be drawn on all
outstanding Letters of Credit, and the Borrowers hereby pledge to the Agent
and the Banks, and grant to the Agent and the Banks a security interest in,
all such cash as security for such Obligations. Upon the curing of all
existing Events of Default to the satisfaction of the Required Banks, the
Agent shall return such cash collateral to the Borrowers; and
9.2.2 Bankruptcy, Insolvency or Reorganization Proceedings
If an Event of Default specified under Section 9.1.14 or 9.1.15 shall
occur, the Banks shall be under no further obligations to make Loans
hereunder and the unpaid principal amount of the Notes then outstanding and
all interest accrued thereon, any unpaid fees and all other Indebtedness of
the Borrowers to the Banks hereunder and thereunder shall be immediately
due and payable, without presentment, demand, protest or notice of any
kind, all of which are hereby expressly waived; and
9.2.3 Set-off.
If an Event of Default shall occur and be continuing, any Bank to whom
any Obligation is owed by any Loan Party hereunder or under any other Loan
Document or any participant of such Bank which has agreed in writing to be
bound by the provisions of Section 10. 1 3 and any branch, Subsidiary or
Affiliate of such Bank or participant anywhere in the world shall have the
right, in addition to all other rights and remedies available to it,
without notice to such Loan Party, to set-off against and apply to the then
unpaid balance of all the Loans and all other Obligations of the Borrowers
and the other Loan Parties hereunder or under any other Loan Document any
debt owing to, and any other funds held in any manner for the account of,
the Borrowers or such other Loan Party by such Bank or participant or by
such branch, Subsidiary or Affiliate, including all funds in all deposit
accounts (whether time or demand, general or special, provisionally
credited or finally credited, or otherwise) now or hereafter maintained by
the Borrowers or such other Loan Party for its own account (but not
including
66
funds held in custodian or trust accounts) with such Bank or participant or
such branch, Subsidiary or Affiliate. Such right shall exist whether or not
any Bank or the Agent shall have made any demand under this Agreement or
any other Loan Document, whether or not such debt owing to or funds held
for the account of the Borrowers or such other Loan Party is or are matured
or unmatured and regardless of the existence or adequacy of any Guaranty or
any other security, right or remedy available to any Bank or the Agent; and
9.2.4 Suits, Actions, Proceedings.
If an Event of Default shall occur and be continuing, and whether or
not the Agent shall have accelerated the maturity of Loans pursuant to any
of the foregoing provisions of this Section 9.2, the Agent or any Bank, if
owed any amount with respect to the Notes, may proceed to protect and
enforce its rights by suit in equity, action at law and/or other
appropriate proceeding, whether for the specific performance of any
covenant or agreement contained in this Agreement or the Notes, including
as permitted by applicable Law the obtaining of the ex parte appointment of
a receiver, and, if such amount shall have become due, by declaration or
otherwise, proceed to enforce the payment thereof or any other legal or
equitable right of the Agent or such Bank; and
9.2.5 Application of Proceeds.
From and after the date on which the Agent has taken any action
pursuant to this Section 9.2 and until all Obligations of the Loan Parties
have been paid in full, any and all proceeds received by the Agent from any
sale or other disposition of the property of the Borrower or any part
thereof, or the exercise of any other remedy by the Agent, shall be applied
as follows:
(i) first, to reimburse the Agent and the Banks for out-of pocket
costs, expenses and disbursements, including reasonable attorneys' and
paralegals' fees and legal expenses, incurred by the Agent or the
Banks in connection with collection of any Obligations of any of the
Loan Parties under any of the Loan Documents, including advances made
by the Banks or any one of them or the Agent for the reasonable
maintenance, preservation, protection or enforcement of, or
realization upon, the property of the Borrowers including advances for
taxes, insurance, repairs and the like and reasonable expenses
incurred to sell or otherwise realize on, or prepare for sale or other
realization on, any of such property;
(ii) second, to the repayment of all Indebtedness then due and
unpaid of the Loan Parties to the Banks incurred under this Agreement
or any of the other Loan Documents, whether of principal, interest,
fees, expenses or otherwise, in such manner as the Agent may determine
in its discretion; and
(iii) the balance, if any, as required by Law.
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9.2.6 Other Rights and Remedies.
In addition to all of the rights and remedies contained in this
Agreement or in any of the other Loan Documents, the Agent shall have all
of the rights and remedies available under applicable Law, all of which
rights and remedies shall be cumulative and non-exclusive, to the extent
permitted by Law. The Agent may, and upon the request of the Required Banks
shall, exercise all post-default rights granted to the Agent and the Banks
under the Loan Documents or applicable Law.
10. THE AGENT
10.1 Appointment.
Each Bank hereby irrevocably designates, appoints and authorizes PNC Bank
to act as Agent for such Bank under this Agreement and to execute and deliver or
accept on behalf of each of the Banks the other Loan Documents. Each Bank hereby
irrevocably authorizes, and each holder of any Note by the acceptance of a Note
shall be deemed irrevocably to authorize, the Agent to take such action on its
behalf under the provisions of this Agreement and the other Loan Documents and
any other instruments and agreements referred to herein, and to exercise such
powers and to perform-n such duties hereunder as are specifically delegated to
or required of the Agent by the terms hereof, together with such powers as are
reasonably incidental thereto. PNC Bank agrees to act as the Agent on behalf of
the Banks to the extent provided in this Agreement.
10.2 Delegation of Duties.
The Agent may perform any of its duties hereunder by or through agents or
employees (provided such delegation does not constitute a relinquishment of its
duties as Agent) and, subject to Sections 10.5 and 10.6, shall be entitled to
engage and pay for the advice or services of any attorneys, accountants or other
experts concerning all matters pertaining to its duties hereunder and to rely
upon any advice so obtained.
10.3 Nature of Duties; Independent Credit Investigation.
The Agent shall have no duties or responsibilities except those expressly
set forth in this Agreement and no implied covenants, functions,
responsibilities, duties, obligations, or liabilities shall be read into this
Agreement or otherwise exist. The duties of the Agent shall be mechanical and
administrative in nature; the Agent shall not have by reason of this Agreement a
fiduciary or trust relationship in respect of any Bank; and nothing in this
Agreement, expressed or implied, is intended to or shall be so construed as to
impose upon the Agent any obligations in respect of this Agreement except as
expressly set forth herein. Without limiting the generality of the foregoing,
the use of the term "agent" in this Agreement with reference to the Agent is not
intended to connote any fiduciary or other implied (or express) obligations
arising under agency doctrine of any applicable Law. Instead, such term is used
merely as a matter of market custom,
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and is intended to create or reflect only an administrative relationship between
independent contracting parties. Each Bank expressly acknowledges (i) that the
Agent has not made any representations or warranties to it and that no act by
the Agent hereafter taken, including any review of the affairs of any of the
Loan Parties, shall be deemed to constitute any representation or warranty by
the Agent to any Bank; (ii) that it has made and will continue to make, without
reliance upon the Agent, its own independent investigation of the financial
condition and affairs and its own appraisal of the creditworthiness of each of
the Loan Parties in connection with this Agreement and the making and
continuance of the Loans hereunder; and (iii) except as expressly provided
herein, that the Agent shall have no duty or responsibility, either initially or
on a continuing basis, to provide any Bank with any credit or other information
with respect thereto, whether coming into its possession before the making of
any Loan or at any time or times thereafter.
10.4 Actions in Discretion of Agent; Instructions from the Banks.
The Agent agrees, upon the written request of the Required Banks, to take
or refrain from taking any action of the type specified as being within the
Agent's rights, powers or discretion herein, provided that the Agent shall not
be required to take any action which exposes the Agent to personal liability or
which is contrary to this Agreement or any other Loan Document or applicable
Law. In the absence of a request by the Required Banks, the Agent shall have
authority, in its sole discretion, to take or not to take any such action,
unless this Agreement specifically requires the consent of the Required Banks or
all of the Banks. Any action taken or failure to act pursuant to such
instructions or discretion shall be binding on the Banks, subject to Section
10.6. Subject to the provisions of Section 10.6, no Bank shall have any right of
action whatsoever against the Agent as a result of the Agent acting or
refraining from acting hereunder in accordance with the instructions of the
Required Banks, or in the absence of such instructions, in the absolute
discretion of the Agent.
10.5 Reimbursement and Indemnification of Agent by the Borrower.
The Borrower unconditionally agrees to pay or reimburse the Agent and hold
the Agent harmless against (a) liability for the payment of all reasonable
out-of-pocket costs, expenses and disbursements, including fees and expenses of
counsel (including the allocated costs of staff counsel), appraisers and
environmental consultants, incurred by the Agent (i) in connection with the
development, negotiation, preparation, printing, execution, syndication,
interpretation and performance of this Agreement and the other Loan Documents,
(ii) relating to any requested amendments, waivers or consents pursuant to the
provisions hereof, (iii) in connection with the enforcement of this Agreement or
any other Loan Document or collection of amounts due hereunder or thereunder or
the proof and allowability of any claim arising under this Agreement or any
other Loan Document, whether in bankruptcy or receivership proceedings or
otherwise, and (iv) in any workout or restructuring or in connection with the
protection, preservation, exercise or enforcement of any of the terms hereof or
of any rights hereunder or under any other Loan Document or in connection with
any foreclosure, collection or bankruptcy proceedings, and (b) all liabilities,
obligations, losses, damages, penalties, actions, judgments,
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suits, costs, expenses or disbursements of any kind or nature whatsoever which
may be imposed on, incurred by or asserted against the Agent, in its capacity as
such, in any way relating to or arising out of this Agreement or any other Loan
Documents or any action taken or omitted by the Agent hereunder or thereunder,
provided that the Borrower shall not be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements if the same results from the Agent's gross
negligence or willful misconduct, or if the Borrowers were not given notice of
the subject claim and the opportunity to participate in the defense thereof, at
its expense (except that the Borrowers shall remain liable to the extent such
failure to give notice does not result in a loss to the Borrowers), or if the
same results from a compromise or settlement agreement entered into without the
consent of the Borrowers, which shall not be unreasonably withheld.
10.6 Exculpatory Provisions; Limitation of Liability.
Neither the Agent nor any of its directors, officers, employees, agents,
attorneys or Affiliates shall (a) be liable to any Bank for any action taken or
omitted to be taken by it or them hereunder, or in connection herewith including
pursuant to any Loan Document, unless caused by its or their own gross
negligence or willful misconduct, (b) be responsible in any manner to any of the
Banks for the effectiveness, enforceability, genuineness, validity or the due
execution of this Agreement or any other Loan Documents or for any recital,
representation, warranty, document, certificate, report or statement herein or
made or furnished under or in connection with this Agreement or any other Loan
Documents, or (c) be under any obligation to any of the Banks to ascertain or to
inquire as to the performance or observance of any of the terms, covenants or
conditions hereof or thereof on the part of the Loan Parties, or the financial
condition of the Loan Parties, or the existence or possible existence of any
Event of Default or Potential Default. No claim may be made by any of the Loan
Parties, any Bank, the Agent or any of their respective Subsidiaries against the
Agent, any Bank or any of their respective directors, officers, employees,
agents, attorneys or Affiliates, or any of them, for any special, indirect or
consequential damages or, to the fullest extent permitted by Law, for any
punitive damages in respect of any claim or cause of action (whether based on
contract, tort, statutory liability, or any other ground) based on, arising out
of or related to any Loan Document or the transactions contemplated hereby or
any act, omission or event occurring in connection therewith, including the
negotiation, documentation, administration or collection of the Loans, and each
of the Loan Parties, (for itself and on behalf of each of its Subsidiaries), the
Agent and each Bank hereby waive, releases and agree never to xxx upon any claim
for any such damages, whether such claim now exists or hereafter arises and
whether or not it is now known or suspected to exist in its favor. Each Bank
agrees that, except for notices, reports and other documents expressly required
to be furnished to the Banks by the Agent hereunder or given to the Agent for
the account of or with copies for the Banks, the Agent and each of its
directors, officers, employees, agents, attorneys or Affiliates shall not have
any duty or responsibility to provide any Bank with an credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of the Loan Parties which may come
into the possession of the Agent or any of its directors, officers, employees,
agents, attorneys or Affiliates.
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10.7 Reimbursement and Indemnification of Agent by Banks.
Each Bank agrees to reimburse and indemnify the Agent (to the extent not
reimbursed by the Borrowers and without limiting the Obligation of the Borrowers
to do so) in proportion to its Ratable Share from and against all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements, including attorneys' fees and disbursements
(including the allocated costs of staff counsel), and costs of appraisers and
environmental consultants, of any kind or nature whatsoever which may be imposed
on, incurred by or asserted against the Agent, in its capacity as such, in any
way relating to or arising out of this Agreement or any other Loan Documents or
any action taken or omitted by the Agent hereunder or thereunder, provided that
no Bank shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements (a) if the same results from the Agent's gross negligence or
willful misconduct, or (b) if such Bank was not given notice of the subject
claim and the opportunity to participate in the defense thereof, at its expense
(except that such Bank shall remain liable to the extent such failure to give
notice does not result in a loss to the Bank), or (c) if the same results from a
compromise and settlement agreement entered into without the consent of such
Bank, which shall not be unreasonably withheld. In addition, each Bank agrees
promptly upon demand to reimburse the Agent (to the extent not reimbursed by the
Borrower and without limiting the Obligation of the Borrower to do so) in
proportion to its Ratable Share for all amounts due and payable by the Borrower
to the Agent in connection with the Agent's periodic audit of the Loan Parties'
books, records and business properties.
10.8 Reliance by Agent.
The Agent shall be entitled to rely upon any writing, telegram, telex or
teletype message, resolution, notice, consent, certificate, letter, cablegram,
statement, order or other document or conversation by telephone or otherwise
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons, and upon the advice and opinions of counsel and
other professional advisers selected by the Agent. The Agent shall be fully
justified in failing or refusing to take any action hereunder unless it shall
first be indemnified to its satisfaction by the Banks against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action.
10.9 Notice of Default.
The Agent shall not be deemed to have knowledge or notice of the occurrence
of any Potential Default or Event of Default unless the Agent has received
written notice from a Bank or the Borrower referring to this Agreement,
describing such Potential Default or Event of Default and stating that such
notice is a "notice of default."
10.10 Notices.
The Agent shall promptly send to each Bank a copy of all notices received
from the Borrowers pursuant to the provisions of this Agreement or the other
Loan Documents
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promptly upon receipt thereof The Agent shall promptly notify the Borrower and
the other Banks of each change in the Base Rate and the effective date thereof.
10.11 Banks in Their Individual Capacities.
With respect to its Commitment, the Loans made by it and any other rights
and powers given to it as a Bank hereunder or under any of the other Loan
Documents, the Agent shall have the same rights and powers hereunder as any
other Bank and may exercise the same as though it were not the Agent, and the
term "Banks" shall, unless the context otherwise indicates, include the Agent in
its individual capacity. PNC Bank and its Affiliates and each of the Banks and
their respective Affiliates may, without liability to account, except as
prohibited herein, make loans to, accept deposits from, discount drafts for, act
as trustee under indentures of, and generally engage in any kind of banking or
trust business with, the Loan Parties and their Affiliates, in the case of the
Agent, as though it were not acting as Agent hereunder and in the case of each
Bank, as though such Bank were not a Bank hereunder. The Banks acknowledge that,
pursuant to such activities, the Agent or its Affiliates may (i) receive
information regarding the Loan Parties (including information that may be
subject to confidentiality obligations in favor of the Loan Parties) and
acknowledge that the Agent shall be under no obligation to provide such
information to them, and (ii) accept fees and other consideration from the Loan
Parties for services in connection with this Agreement and otherwise without
having to account for the same to the Banks.
10.12 Holders of Notes.
The Agent may deem and treat any payee of any Note as the owner thereof for
all purposes hereof unless and until written notice of the assignment or
transfer thereof shall have been filed with the Agent. Any request, authority or
consent of any Person who at the time of making such request or giving such
authority or consent is the holder of any Note shall be conclusive and binding
on any subsequent holder, transferee or assignee of such Note or of any Note or
Notes issued in exchange therefor.
10.13 Equalization of Banks.
The Banks and the holders of any participations in any Notes agree among
themselves that, with respect to all amounts received by any Bank or any such
holder for application on any Obligation hereunder or under any Note or under
any such participation, whether received by voluntary payment, by realization
upon security, by the exercise of the right of set-off or banker's lien, by
counterclaim or by any other non-pro rata source, equitable adjustment will be
made in the manner stated in the following sentence so that, in effect, all such
excess amounts will be shared ratably among the Banks and such holders in
proportion to their interests in payments under the Notes, except as otherwise
provided in Section 4.4.3 or 5.6. The Banks or any such holder receiving any
such amount shall purchase for cash from each of the other Banks an interest in
such Bank's Loans in such amount as shall result in a ratable participation by
the Banks and each such holder in the aggregate unpaid amount under the Notes,
provided that if all or any portion of such excess amount is thereafter
recovered from the Bank or
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the holder making such purchase, such purchase shall be rescinded and the
purchase price restored to the extent of such recovery, together with interest
or other amounts, if any, required by law (including court order) to be paid by
the Bank or the holder making such purchase.
10.14 Successor Agent.
If the Agent shall resign under this Agreement, then either (a) the
Required Banks shall appoint from among the Banks a successor agent for the
Banks, subject to the consent of the Borrowers, such consent not to be
unreasonably withheld, or (b) if a successor agent shall not be so appointed and
approved within the thirty (30) day period following the Agent's notice to the
Banks of its resignation, then the Agent shall appoint, with the consent of the
Borrower, such consent not to be unreasonably withheld, a successor agent who
shall serve as Agent until such time as the Required Banks appoint and the
Borrower consents to the appointment of a successor agent. Upon its appointment
pursuant to either clause (a) or (b) above, such successor agent shall succeed
to the rights, powers and duties of the Agent, and the term "Agent" shall mean
such successor agent, effective upon its appointment, and the former Agent's
rights, powers and duties as Agent shall be terminated without any other or
further act or deed on the part of such former Agent or any of the parties to
this Agreement. After the resignation of any Agent hereunder, the provisions of
this Section 10 shall inure to the benefit of such former Agent and such former
Agent shall not by reason of such resignation be deemed to be released from
liability for any actions taken or not taken by it while it was an Agent under
this Agreement.
10. 15 Agent's Fee.
The Borrowers shall pay to the Agent fees (the "Agent's Fees") under the
terms of a letter (the "Agent's Letter") between the Company and Agent, as
amended from time to time.
10. 16 Availability of Funds.
The Agent may assume that each Bank has made or will make the proceeds of a
Loan available to the Agent unless the Agent shall have been notified by such
Bank on or before the close of Business on the Business Day preceding the
Borrowing Date with respect to such Loan (whether using its own funds pursuant
to this Section 10. 1 6 or using proceeds deposited with the Agent by the Banks
and whether such finding occurs before or after the time on which Banks are
required to deposit the proceeds of such Loan with the Agent). The Agent may, in
reliance upon such assumption (but shall not be required to), make available to
the Borrower a corresponding amount. If such corresponding amount is not in fact
made available to the Agent by such Bank, the Agent shall be entitled to recover
such amount on demand from such Bank (or, if such Bank fails to pay such amount
forthwith upon such demand from the Borrowers) together with interest thereon,
in respect of each day during the period commencing on the date such amount was
made available to the Borrower and ending on the date the Agent recovers such
amount, at a rate per annum equal to the applicable interest rate in respect of
the Loan.
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10.17 Calculations.
In the absence of gross negligence or willful misconduct, the Agent shall
not be liable for any error in computing the amount payable to any Bank whether
in respect of the Loans, fees or any other amounts due to the Banks under this
Agreement. In the event an error in computing any amount payable to any Bank is
made, the Agent, the Borrowers and each affected Bank shall, forthwith upon
discovery of such error, make such adjustments as shall be required to correct
such error, and any compensation therefor will be calculated at the Federal
Funds Effective Rate.
10.18 Beneficiaries.
Except as expressly provided herein, the provisions of this Section 10 are
solely for the benefit of the Agent and the Banks, and the Loan Parties shall
not have any rights to rely on or enforce any of the provisions hereof. In
performing its functions and duties under this Agreement, the Agent shall act
solely as agent of the Banks and does not assume and shall not be deemed to have
assumed any obligation toward or relationship of agency or trust with or for any
of the Loan Parties.
11. MISCELLANEOUS
11.1 Modifications, Amendments or Waivers.
With the written consent of the Required Banks, the Agent, acting on behalf
of all the Banks, and the Borrowers, on behalf of the Loan Parties, may from
time to time enter into written agreements amending or changing any provision of
this Agreement or any other Loan Document or the rights of the Banks or the Loan
Parties hereunder or thereunder, or may grant written waivers or consents to a
departure from the due performance of the Obligations of the Loan Parties
hereunder or thereunder. Any such agreement, waiver or consent made with such
written consent shall be effective to bind all the Banks and the Loan Parties;
provided, that, without the written consent of all the Banks, no such agreement,
waiver or consent may be made which will: 11.1.1 Increase of Commitment;
Extension or Expiration Date.
Increase the amount of the Commitment of any Bank hereunder or extend the
Expiration Date;
11.1.2 Extension of Payment; Reduction of Principal Interest or Fees;
Modification of Terms of Payment.
Whether or not any Loans are outstanding, extend the time for payment
of principal or interest of any Loan (excluding the due date of any
mandatory prepayment of a Loan or any mandatory Commitment reduction in
connection with such a mandatory prepayment
74
hereunder except for mandatory reductions of the Commitments on the
Expiration Date), the Commitment Fee or any other fee payable to any Bank,
or reduce the principal amount of or the rate of interest borne by any Loan
or reduce the Commitment Fee or any other fee payable to any Bank, or
otherwise affect the terms of payment of the principal of or interest of
any Loan, the Commitment Fee or any other fee payable to any Bank;
11.1.3 Release of Guarantor.
Except for sales of assets permitted by Section 8.2.7, release any
Guarantor from its Obligations under the Guaranty Agreement or any other
security for any of the Loan Parties' Obligations; or
11.1.4 Miscellaneous
Amend Section 5.2 [Pro Rata Treatment of Banks], 10.6 [Exculpatory
Provisions, etc.] or 10.13 [Equalization of Banks] or this Section 11.1,
alter any provision regarding the pro rata treatment of the Banks, change
the definition of Required Banks, or change any requirement providing for
the Banks or the Required Banks to authorize the taking of any action
hereunder;
provided, further, that no agreement, waiver or consent which would modify
the interests, rights or obligations of the Agent in its capacity as Agent
or as the issuer of Letters of Credit shall be effective without the
written consent of the Agent
11.2 No Implied Waivers; Cumulative Remedies-, Writing Required.
No course of dealing and no delay or failure of the Agent or any Bank in
exercising any right, power, remedy or privilege under this Agreement or any
other Loan Document shall affect any other or future exercise thereof or operate
as a waiver thereof, nor shall any single or partial exercise thereof or any
abandonment or discontinuance of steps to enforce such a right, power, remedy or
privilege preclude any further exercise thereof or of any other right, power,
remedy or privilege. The rights and remedies of the Agent and the Banks under
this Agreement and any other Loan Documents are cumulative and not exclusive of
any rights or remedies which they would otherwise have. Any waiver, permit,
consent or approval of any kind or character on the part of any Bank of any
breach or default under this Agreement or any such waiver of any provision or
condition of this Agreement must be in writing and shall be effective only to
the extent specifically set forth in such writing.
11.3 Reimbursement and Indemnification of Banks by the Borrower; Taxes.
The Borrowers agree unconditionally upon demand to pay or reimburse to each
Bank (other than the Agent, as to which the Borrowers' Obligations are set forth
in Section 10.5) and to save such Bank harmless against (i) liability for the
payment of all reasonable out-of pocket costs, expenses and disbursements
(including fees and expenses of counsel (including allocated costs of staff
counsel) for each Bank except with respect to (a) and (b) below), incurred
75
by such Bank (a) relating to any amendments, waivers or consents pursuant to the
provisions hereof, (b) in connection with the enforcement of this Agreement or
any other Loan Document, or collection of amounts due hereunder or thereunder or
the proof and allowability of any claim arising under this Agreement or any
other Loan Document, whether in bankruptcy or receivership proceedings or
otherwise, and (c) in any workout or restructuring or in connection with the
protection, preservation, exercise or enforcement of any of the terms hereof or
of any rights hereunder or under any other Loan Document or in connection with
any foreclosure, collection or bankruptcy proceedings, or (ii) all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by or asserted against such Bank, in its capacity as such, in any
way relating to or arising out of this Agreement or any other Loan Documents or
any action taken or omitted by such Bank hereunder or thereunder, provided that
the Borrower shall not be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements (A) if the same results from such Bank's gross
negligence or willful misconduct, or (B) if the Borrowers were not given notice
of the subject claim and the opportunity to participate in the defense thereof,
at its expense (except that the Borrowers shall remain liable to the extent such
failure to give notice does not result in a loss to the Borrowers), or (C) if
the same results from a compromise or settlement agreement entered into without
the consent of the Borrowers, which shall not be unreasonably withheld. The
Banks will attempt to minimize the fees and expenses of legal counsel for the
Banks which are subject to reimbursement by the Borrowers hereunder by
considering the usage of one law fin-n to represent the Banks and the Agent if
appropriate under the circumstances. The Borrowers agree unconditionally to pay
all stamp, document, transfer, recording or filing taxes or fees and similar
impositions now or hereafter determined by the Agent or any Bank to be payable
in connection with this Agreement or any other Loan Document, and the Borrowers
agree unconditionally to save the Agent and the Banks harmless from and against
any and all present or future claims, liabilities or losses with respect to or
resulting from any omission to pay or delay in paying any such taxes, fees or
impositions.
11.4 Holidays.
Whenever payment of a Loan to be made or taken hereunder shall be due on a
day which is not a Business Day such payment shall be due on the next Business
Day and such extension of time shall be included in computing interest and fee,
except that the Loans shall be due on the Business Day preceding the Expiration
Date if the Expiration Date is not a Business Day. Whenever any payment or
action to be made or taken hereunder (other than payment of the Loans) shall be
stated to be due on a day which is not a business Day, such payment or action
shall be made or taken on the next following Business Day (except as provided in
Section 4.2 with respect to Interest Periods under the Euro-Rate Option), and
such extension of time shall not be included in computing interest or fees, if
any, in connection with such payment or action. If, by operation of the previous
sentence of this Section 1 1.4, any payment in respect of any portion any
relevant period (including any Interest Period) is made or calculated on such
"next following Business Day", then such amounts shall be paid and included in
amounts paid in and for the period in which such "next following Business Day"
falls.
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11.5 Funding by Branch, Subsidiary or Affiliate.
11.5.1 Notional Funding.
Each Bank shall have the right from time to time, without notice to
the Borrower, to deem any branch, Subsidiary or Affiliate (which for the
purposes of this Section 11.5 shall mean any corporation or association
which is directly or indirectly controlled by or is under direct or
indirect common control with any corporation or association which directly
or indirectly controls such Bank) of such Bank to have made, maintained or
funded any Loan to which the Euro-Rate Option applies at any time, provided
that immediately following (on the assumption that a payment were then due
from the Borrower to such other office), and as a result of such change,
the Borrower would not be under any greater financial obligation pursuant
to Section 5.6 than it would have been in the absence of such change.
Notional funding offices may be selected by each Bank without regard to
such Bank's actual methods of making, maintaining or funding the Loans or
any sources of funding actually used by or available to such Bank.
11.5.2 Actual Funding.
Each Bank shall have the right from time to time to make or maintain
any Loan by arranging for a branch, Subsidiary or Affiliate of such Bank to
make or maintain such Loan subject to the last sentence of this Section 1
1.5.2. If any Bank causes a branch, Subsidiary or Affiliate to make or
maintain any part of the Loans hereunder, all terms and conditions of this
Agreement shall, except where the context clearly requires otherwise, be
applicable to such part of the Loans to the same extent as if such Loans
were made or maintained by such Bank, but in no event shall any Bank's use
of such a branch, Subsidiary or Affiliate to make or maintain any part of
the Loans hereunder cause such Bank or such branch, Subsidiary or Affiliate
to incur any cost or expenses payable by the Borrower hereunder or require
the Borrowers to pay any other compensation to any Bank (including any
expenses incurred or payable pursuant to Section 5.6) which would otherwise
not be incurred.
11.6 Notices.
All notices, requests, demands, directions and other communications (as
used in this Section 11.6, collectively referred to as "notices") given to or
made upon any party hereto under the provisions of this Agreement shall be by
telephone or in writing (including telex or facsimile communication) unless
otherwise expressly permitted hereunder and shall be delivered or sent by telex
or facsimile to the respective parties at the addresses and numbers set forth
under their respective names on Schedule 1.1(B) hereof or in accordance with any
subsequent unrevoked written direction from any party to the others. All notices
shall, except as otherwise expressly herein provided, be effective (a) in the
case of telex or facsimile, when received, (b) in the case of hand-delivered
notice, when hand-delivered, (c) in the case of telephone, when telephoned,
provided, however, that in order to be effective, telephonic notices must be
confirmed in writing no later than the next day by letter, facsimile or telex,
(d) if given by mail, four (4) days after such communication is deposited in the
mail with first-class postage prepaid,
77
return receipt requested, and (e) if given by any other means (including by air
courier), when delivered; provided, that notices to the Agent shall not be
effective until received at the addresses of the Agent shown on Schedule 1.1(B).
Any Bank giving any notice to any Loan Party shall simultaneously send a copy
thereof to the Agent, and the Agent shall promptly notify the other Banks of the
receipt by it of any such notice.
11.7 Severability.
The provisions of this Agreement are intended to be severable. If any
provision of this Agreement shall be held invalid or unenforceable in whole or
in part in any jurisdiction, such provision shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without in any
manner affecting the validity or enforceability thereof in any other
jurisdiction or the remaining provisions hereof in any jurisdiction.
11.8 Governing Law.
Each Letter of Credit and Section 2.9 shall be subject to the Uniform
Customs and Practice for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500, as the same may be revised or amended
from time to time, and to the extent not inconsistent therewith, the internal
laws of the Commonwealth of Pennsylvania without regard to its conflict of laws
principles and the balance of this Agreement shall be deemed to be a contract
under the Laws of the Commonwealth of Pennsylvania and for all purposes shall be
governed by and construed and enforced in accordance with the internal laws of
the Commonwealth of Pennsylvania without regard to its conflict of laws
principles.
11.9 Prior Understanding.
This Agreement and the other Loan Documents supersede all prior
understandings and agreements, whether written or oral, between the parties
hereto and thereto relating to the transactions provided for herein and therein,
including any prior confidentiality agreements and commitments.
11.10 Duration; Survival.
All representations and warranties of the Loan Parties contained herein or
made in connection herewith shall survive the making of Loans and issuance of
Letters of Credit and shall not be waived by the execution and delivery of this
Agreement, any investigation by the Agent or the Banks, the making of Loans,
issuance of Letters of Credit, or payment in full of the Loans. All covenants
and agreements of the Loan Parties contained in Sections 8.1, 8.2 and 8.3 herein
shall continue in full force and effect from and after the date hereof so long
as the Borrower may borrow or request Letters of Credit hereunder and until
termination of the Commitments and payment in full of the Loans and expiration
or termination of all Letters of Credit. All covenants and agreements of the
Borrower contained herein relating to the payment of principal, interest,
premiums, additional compensation or expenses and indemnification, including
those set forth in the Notes, Section 5 and Sections 10.5, 10.7 and 11.3, shall
survive
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payment in full of the Loans, expiration or termination of the Letters of Credit
and termination of the Commitments.
11.11 Successors and Assigns.
(i) This Agreement shall be binding upon and shall inure to the
benefit of the Banks, the Agent, the Loan Parties and their respective
successors and assigns, except that none of the Loan Par-ties may assign or
transfer any of its rights and Obligations hereunder or any interest
herein. Each Bank may, at its own cost, make assignments of or sell
participations in all or any part of its Commitment and the Loans made by
it to one or more banks or other entities, subject to the consent of the
Borrowers and the Agent with respect to any assignee, such consent not to
be unreasonably withheld, provided that (1) no consent of the Borrowers
shall be required in the case of an assignment by a Bank to an Affiliate of
such Bank, and (2) assignments may not be made in amounts less than
$5,000,000. In the case of an assignment, upon receipt by the Agent of the
Assignment and Assumption Agreement, the assignee shall have, to the extent
of such assignment (unless otherwise provided therein), the same rights,
benefits and obligations as it would have if it had been a signatory Bank
hereunder, the Commitments shall be adjusted accordingly, and upon
surrender of any Note subject to such assignment, the Borrowers shall
execute and deliver a new Note to the assignee in an amount equal to the
amount of the Commitment assumed by it and a new Note to the assigning Bank
in an amount equal to the Commitment retained by it hereunder. The
assigning Bank shall pay to the Agent a service fee in the amount of $3,000
for each assignment. In the case of a participation, the participant shall
only have the rights specified in Section 9.2.3 (the participant's rights
against such Bank in respect of such participation to be those set forth in
the agreement executed by such Bank in favor of the participant relating
thereto and not to include any voting rights except with respect to changes
of the type referenced in Sections 11.1.1, 11.1.2, or 11.1.3, all of such
Bank's obligations under this Agreement or any other Loan Document shall
remain unchanged, and all amounts payable by any Loan Party hereunder or
thereunder shall be determined as if such Bank had not sold such
participation.
(ii) Any assignee or participant which is not incorporated under the
Laws of the United States of America or a state thereof shall deliver to
the Borrowers and the Agent the form of certificate described in Section
11.17 relating to federal income tax withholding. Each Bank may furnish any
publicly available information concerning any Loan Party or its
Subsidiaries and any other information concerning any Loan Party or its
Subsidiaries in the possession of such Bank from time to time to assignees
and participants (including prospective assignees or participants),
provided that such assignees and participants agree to be bound by the
provisions of Section 11.12.
(iii) Notwithstanding any other provision in this Agreement, any Bank
may at any time pledge or grant a security interest in all or any portion
of its rights under this Agreement, its Note and the other Loan Documents
to any Federal Reserve Bank in accordance with Regulation A of the FRB or
U.S. Treasury Regulation 31 CFR Section 203.14 without notice to or consent
of the Borrower or the Agent. No such pledge or grant of a security
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interest shall release the transferor Bank of its obligations hereunder or
under any other Loan Document.
11.12 Confidentiality.
The Agent and the Banks each agree to keep confidential all information
obtained from any Loan Party or its Subsidiaries which is nonpublic and
confidential or proprietary in nature (including any information the Borrowers
specifically designate as confidential), except as provided below, and to use
such information only in connection with their respective capacities under this
Agreement and for the purposes contemplated hereby. The Agent and the Banks
shall be permitted to disclose such information (i) to outside legal counsel,
accountants and other professional advisors who need to know such information in
connection with the administration and enforcement of this Agreement, subject to
agreement of such Persons to maintain the confidentiality, (ii) to assignees and
participants as contemplated by Section 11.11, (iii) to the extent requested by
any bank regulatory authority or, with notice to the Borrowers, as otherwise
required by applicable Law or by any subpoena or similar legal process, or in
connection with any investigation or proceeding arising out of the transactions
contemplated by this Agreement, (iv) if it becomes publicly available other than
as a result of a breach of this Agreement or becomes available from a source not
known to be subject to confidentiality restrictions, or (v) if the Borrowers
shall have consented to such disclosure.
11.13 Counterparts.
This Agreement may be executed by different parties hereto on any number of
separate counterparts, each of which, when so executed and delivered, shall be
an original, and all such counterparts shall together constitute one and the
same instrument.
11.14 Agent's or Bank's Consent.
Whenever the Agent's or any Bank's consent is required to be obtained under
this Agreement or any of the other Loan Documents as a condition to any action,
inaction, condition or event, the Agent and each Bank shall be authorized to
give or withhold such consent in its sole and absolute discretion and to
condition its consent upon the giving of additional collateral, the payment of
money or any other matter.
11.15 Exceptions.
The representations, warranties and covenants contained herein shall be
independent of each other, and no exception to any representation, warranty or
covenant shall be deemed to be an exception to any other representation,
warranty or covenant contained herein unless expressly provided, nor shall any
such exceptions be deemed to permit any action or omission that would be in
contravention of applicable Law.
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11.16 CONSENT TO FORUM; WAIVER OF JURY TRIAL.
EACH LOAN PARTY HEREBY IRREVOCABLY CONSENTS TO THE NONEXCLUSIVE
JURISDICTION OF THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY AND THE UNITED
STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF PENNSYLVANIA, AND WAIVES
PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH
SERVICE OF PROCESS BE MADE BY CERTIFIED OR REGISTERED MAIL DIRECTED TO SUCH LOAN
PARTY AT THE ADDRESSES PROVIDED FOR IN SECTION 11.6 AND SERVICE SO MADE SHALL BE
DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT THEREOF. EACH LOAN PARTY WAIVES ANY
OBJECTION TO JURISDICTION AND VENUE OF ANY ACTION INSTITUTED AGAINST IT AS
PROVIDED HEREIN AND AGREES NOT TO ASSERT ANY DEFENSE BASED ON LACK OF
JURISDICTION OR VENUE. EACH LOAN PARTY, THE AGENT AND THE BANKS HEREBY WAIVE
TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND
ARISING OUT OF OR RELATED TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE
COLLATERAL TO THE FULL EXTENT PERMITTED BY LAW.
11.17 Tax Withholding Clause.
Each Bank or assignee or participant of a Bank that is not incorporated
under the Laws of the United States of America or a state thereof agrees that it
will deliver to each of the Borrower and the Agent two (2) duly completed copies
of the following: (i) Internal Revenue Service Form W-9, 4224 or 1001, or other
applicable form prescribed by the Internal Revenue Service, certifying that such
Bank, assignee or participant is entitled to receive payments under this
Agreement and the other Loan Documents without deduction or withholding of any
United States federal income taxes, or is subject to such tax at a reduced rate
under an applicable tax treaty, or (ii) Internal Revenue Service Form W-8 or
other applicable form or a certificate of such Bank, assignee or participant
indicating that no such exemption or reduced rate is allowable with respect to
such payments. Each Bank, assignee or participant required to deliver to the
Borrowers and the Agent a form or certificate pursuant to the preceding sentence
shall deliver such form or certificate as follows: (A) each Bank which is a
party hereto on the Closing Date shall deliver such form or certificate at least
five (5) Business Days prior to the first date on which any interest or fees are
payable by the Borrower hereunder for the account of such Bank; (B) each
assignee or participant shall deliver such form or certificate at least five (5)
Business Days before the effective date of such assignment or participation
(unless the Agent in its sole discretion shall permit such assignee or
participant to deliver such form or certificate less than five (5) Business Days
before such date in which case it shall be due on the date specified by the
Agent). Each Bank, assignee or participant which so delivers a Form W-8, W-9,
4224 or 1001 further undertakes to deliver to each of the Borrowers and the
Agent two (2) additional copies of such form (or a successor form) on or before
the date that such form expires or becomes obsolete or after the occurrence of
any event requiring a change in the most recent form so delivered by it, and
such amendments thereto or extensions or renewals thereof as may be reasonably
requested
81
by the Borrowers or the Agent, either certifying that such Bank, assignee or
participant is entitled to receive payments under this Agreement and the other
Loan Documents without deduction or withholding of any United States federal
income taxes or is subject to such tax at a reduced rate under an applicable tax
treaty or stating that no such exemption or reduced rate is allowable. The Agent
shall be entitled to withhold United States federal income taxes at the full
withholding rate unless the Bank, assignee or participant establishes an
exemption or that it is subject to a reduced rate as established pursuant to the
above provisions.
11.18 Joinder of Borrowers.
Any Subsidiary of a Loan Party which is required to join this Agreement as
a Borrower pursuant to Section 8.2.9 shall execute and deliver to the Agent (i)
a Joinder in substantially the form attached hereto as Exhibit 1.1(J) pursuant
to which it shall join (subject to Section 5.7) as a Borrower each of the
documents to which the Borrowers are parties; and (ii) documents in the forms
described in Section 7.1 modified as appropriate to relate to such Subsidiary.
The Company shall deliver such Joinder and related documents to the Agent within
five (5) Business Days after the date of the filing of such Subsidiary's
articles of incorporation if the Subsidiary is a corporation, the date of the
filing of its certificate of limited partnership if it is a limited partnership,
the date of its organization if it is an entity other than a limited partnership
or corporation or the date of its acquisitions by any Loan Party, as applicable.
IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly
authorized, have executed this Agreement as of the day and year first above
written.
XX XXXX'X INCORPORATED
By: /s/ Xxxxx X. Xxxxxxx
--------------------
Title: Vice President
--------------
PLANT ENGINEERING CONSULTANTS, INC.
By: /s/ Xxxxx X. Xxxxxxx
--------------------
Title: Vice President
--------------
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GRUPO BLAJU, S.A., de C.V.
By: /s/ Xxxxx X. Xxxxxxx
--------------------
Title: Attorney-in-fact
----------------
XX XXXX'X CANADA, LTD.
By: /s/ Xxxxx X. Xxxxxxx
--------------------
Title: Treasurer
---------
GUARANTOR:
XX XXXX'X CORPORATION
By: /s/ Xxxxx X. Xxxxxxx
--------------------
Title: Vice President
--------------
PNC BANK, NATIONAL ASSOCIATION,
individually and as Agent
By: /s/ Xxxxx X. Xxxxx
-------------------
Title: Corporate Banmking Officer
--------------------------
NATIONAL CITY BANK OF PENNSYLVANIA
By: /s/ Xxxxx Xxxxxx
-----------------
Title: Assistant Vice President
------------------------
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