1
EXHIBIT 10.48
AMENDED AND RESTATED
CREDIT AGREEMENT
among
IPC, INC.
as Borrower,
AND
IVEX PACKAGING CORPORATION
AND
THE DOMESTIC SUBSIDIARIES OF IPC, INC.
as Guarantors,
AND
THE LENDERS IDENTIFIED HEREIN,
AND
NATIONSBANK, N.A.
as Administrative Agent
AND
BANKERS TRUST COMPANY
as Documentation Agent
DATED AS OF OCTOBER __, 1997
2
TABLE OF CONTENTS
-----------------
SECTION 1 DEFINITIONS AND ACCOUNTING TERMS...................................2
1.1 Definitions.......................................................2
1.2 Computation of Time Periods and Other Definitional Provisions....25
1.3 Accounting Terms.................................................25
SECTION 2 CREDIT FACILITIES..................................................26
2.1 Revolving Loans..................................................26
2.2 Letter of Credit Subfacility.....................................28
2.3 Tranche A Term Loan..............................................33
2.4 Tranche B Term Loan..............................................35
2.5 Continuations and Conversions....................................38
2.6 Minimum Amounts..................................................39
SECTION 3 GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS
OF CREDIT..........................................................39
3.1 Interest.........................................................39
3.2 Place and Manner of Payments.....................................40
3.3 Prepayments......................................................40
3.4 Fees.............................................................42
3.5 Payment in full at Maturity......................................43
3.6 Computations of Interest and Fees................................44
3.7 Pro Rata Treatment...............................................45
3.8 Sharing of Payments..............................................46
3.9 Capital Adequacy.................................................46
3.10 Inability to Determine Interest Rate............................47
3.11 Illegality......................................................47
3.12 Requirements of Law.............................................48
3.13 Taxes...........................................................49
3.14 Compensation....................................................51
SECTION 4 GUARANTY...........................................................52
4.1 Guaranty of Payment..............................................52
4.2 Obligations Unconditional........................................52
4.3 Modifications....................................................53
4.4 Waiver of Rights.................................................53
4.5 Reinstatement....................................................54
4.6 Remedies.........................................................54
4.7 Limitation of Guaranty...........................................54
4.8 Rights of Contribution...........................................54
SECTION 5 CONDITIONS PRECEDENT...............................................55
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5.1 Closing Conditions...............................................55
5.2 Conditions to All Extensions of Credit...........................62
SECTION 6 REPRESENTATIONS AND WARRANTIES.....................................63
6.1 Organization and Good Standing...................................63
6.2 Due Authorization................................................63
6.3 No Conflicts.....................................................63
6.4 Consents.........................................................64
6.5 Enforceable Obligations..........................................64
6.6 Financial Condition..............................................64
6.7 No Default.......................................................64
6.8 Ownership........................................................64
6.9 Indebtedness.....................................................64
6.10 Litigation......................................................65
6.11 Material Agreements.............................................65
6.12 Taxes...........................................................65
6.13 Compliance with Law.............................................65
6.14 ERISA...........................................................65
6.15 Subsidaries.....................................................66
6.16 Use of Proceeds; Margin Stock...................................67
6.17 Government Regulation...........................................67
6.18 Environmental Matters...........................................67
6.19 Intellectual Property...........................................69
6.20 Solvency........................................................69
6.21 Investments.....................................................69
6.22 Location of Collateral..........................................69
6.23 No Financing of Corporate Takeovers.............................69
6.24 Disclosure......................................................70
6.25 Licenses, etc...................................................70
6.26 No Burdensome Restrictions......................................70
6.27 Collateral Documents............................................70
SECTION 7 AFFIRMATIVE COVENANTS..............................................71
7.1 Information Covenants............................................71
7.2 Financial Covenants..............................................75
7.3 Preservation of Existence and Franchises.........................76
7.4 Books and Records................................................77
7.5 Compliance with Law..............................................77
7.6 Payment of Taxes and Other Indebtedness..........................77
7.7 Insurance........................................................77
7.8 Maintenance of Property..........................................78
7.9 Performance of Obligations.......................................78
7.10 Collateral......................................................79
7.11 Use of Proceeds.................................................79
7.12 Audits/Inspections..............................................79
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11.5 Payment of Expenses; Indemnification...........................100
11.6 Amendments, Waivers and Consents...............................100
11.7 Counterparts/Telecopy...........................................102
11.8 Headings.......................................................102
11.9 Defaulting Lender..............................................102
11.10 Survival of Indemnification and Representations and
Warranties....................................................102
11.11 Governing Law; Jurisdiction...................................102
11.12 Waiver of Jury Trial..........................................103
11.13 Time..........................................................103
11.14 Severability..................................................103
11.15 Further Assurances............................................104
11.16 Entirety......................................................104
11.17 Binding Effect................................................104
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SCHEDULES
---------
Schedule 1.1(a) Commitment Percentages
Schedule 5.1(e)(i) Mortgaged Properties
Schedule 5.1(e)(ii) Leasehold Mortgaged Properties
Schedule 5.1(e)(iii) Other Leasehold Properties
Schedule 6.9 Indebtedness
Schedule 6.15 Subsidiaries
Schedule 6.18 Environmental Matters
Schedule 6.19 Intellectual Property
Schedule 6.21 Investments
Schedule 6.22(a) Real Property Locations
Schedule 6.22(b) Personal Property Locations
Schedule 6.22(c) Chief Executive Offices
Schedule 7.7 Insurance
Schedule 7.16 Other Leasehold Properties
Schedule 8.2 Liens
Schedule 8.7 Investments
Schedule 8.9 Affiliate Transactions
Schedule 11.1 Notices
EXHIBITS
--------
Exhibit 2.1(b) Form of Notice of Borrowing
Exhibit 2.1(e) Form of Revolving Note
Exhibit 2.3(d) Form of Tranche A Term Note
Exhibit 2.4(d) Form of New Commitment Agreement
Exhibit 2.4(e) Form of Tranche B Term Note
Exhibit 2.5 Form of Notice of Continuation/Conversion
Exhibit 7.1(d) Form of Officer's Certificate
Exhibit 7.13 Form of Joinder Agreement
Exhibit 11.13 Form of Assignment Agreement
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AMENDED AND RESTATED
CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT (this "Credit Agreement"), is
entered into as of October ____, 1997 among IPC, INC., a Delaware corporation
("Borrower"), IVEX PACKAGING CORPORATION, a Delaware corporation ("Holdings"),
each of Borrower's Domestic Subsidiaries (the Borrower's Domestic Subsidiaries,
together with Holdings, individually a "Guarantor" and collectively the
"Guarantors"), the Lenders (as defined herein), NATIONSBANK, N.A., as
Administrative Agent for the Lenders and BANKERS TRUST COMPANY, as
Documentation Agent for the Lenders.
RECITALS
WHEREAS, the Borrower, the Guarantors, the lenders party thereto and
NationsBank, N.A., as agent entered into that certain Amended and Restated
Credit Agreement dated as of March 24, 1997 which provided a $205 million
credit facility to the Borrower (the "Prior Credit Agreement"). The credit
facility provided pursuant to the Prior Credit Agreement replaced and
refinanced the credit facilities provided to the Borrower by NationsBank, N.A.,
as agent and certain other lenders pursuant to a credit agreement dated as of
December 7, 1995.
WHEREAS, the Borrower and the Guarantors have requested the Lenders to
provide a new amended and restated senior secured credit facility to replace
and refinance the credit facility provided pursuant to the Prior Credit
Agreement. Specifically, the Borrower and the Guarantors have requested that,
among other things, this new amended and restated senior secured credit
facility (i) provide up to $475 million of indebtedness to the Borrower and
(ii) extend the final maturity of the credit facilities provided under the
Prior Credit Agreement.
WHEREAS, the Lenders party hereto have agreed to make the requested
amended and restated senior secured credit facility available to the Borrower
on the terms and conditions hereinafter set forth.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
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SECTION 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 DEFINITIONS.
As used herein, the following terms shall have the meanings herein
specified unless the context otherwise requires. Defined terms herein shall
include in the singular number the plural and in the plural the singular:
"Acadia" means Acadia Partners, L.P., a Delaware limited partnership.
"Additional Credit Party" means each Person that becomes a Guarantor
after the Closing Date, as provided in Section 7.13.
"Adjusted Base Rate" means the Base Rate plus the Applicable
Percentage.
"Adjusted Eurodollar Rate" means the Eurodollar Rate plus the
Applicable Percentage.
"Administrative Agent" means NationsBank, N.A. (or any successor
thereto) or any successor administrative agent appointed pursuant to
Section 10.9.
"Administrative Agent Fee Letter" means that certain letter
agreement dated as of August 5, 1997 between the Administrative Agent and
the Borrower, as it may be amended, modified, supplemented or replaced
from time to time.
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling (including but not limited to all
directors and officers of such Person), controlled by or under direct or
indirect common control with such Person. A Person shall be deemed to
control a Person if such Person possesses, directly or indirectly, the
power (i) to vote 10% or more of the securities having ordinary voting
power for the election of directors of such Person or (ii) to direct or
cause direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract or otherwise.
"Agency Services Address" means NationsBank, N.A., NC1-001-15-04,
000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attn: Agency
Services, or such other address as may be identified by written notice
from the Administrative Agent to the Borrower.
"Agents" means the Administrative Agent, the Documentation Agent and
the Collateral Agent and any successors and assigns in such capacity.
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"Agents Fee Letter" means that certain letter agreement dated as of
August 5, 1997 among the Agents and the Borrower, as it may be amended,
modified, supplemented or replaced from time to time.
"Applicable Percentage" means the appropriate applicable percentages
corresponding to the Leverage Ratio in effect as of the most recent
Calculation Date as shown below:
Applicable Applicable
Percentage For Percentage For
Pricing Eurodollar Loans Base Rate Loans Applicable
Level Leverage Ratio that are that are Percentage for
Revolving Loans Revolving Loans Letter of Credit
or Tranche A or Tranche A Fees
Term Loans Term Loans
------------------------------------------------------------------------------------------------
I < 2.75 to 1.0 0.625% 0% 0.625%
-
-------------------------------------------------------------------------------------------------
< 3.5 to 1.0
-
II but > 2.75 to
1.0 0.875% 0% 0.875%
-------------------------------------------------------------------------------------------------
< 4.0 to 1.0
-
III but > 3.5 to 1.0 1.125% 0.125% 1.125%
-------------------------------------------------------------------------------------------------
< 4.5 to 1.0 but
-
IV > 4.0 to 1.0 1.375% 0.375% 1.375%
-------------------------------------------------------------------------------------------------
V > 4.5 to 1.0 1.625% 0.625 % 1.625%
=================================================================================================
Applicable Applicable
Percentage for Percentage For
Applicable Eurodollar Loans Base Rate Loans
Percentage for that are Tranche that are Tranche
Pricing Level Commitment Fees B Term Loans B Term Loans
I 0.1875 % 1.500% 0.500%
------------------------------------------------------------------------------
II 0.250% 1.500% 0.750%
------------------------------------------------------------------------------
III 0.250% 1.750% 0.750%
------------------------------------------------------------------------------
IV 0.250% 1.750% 0.750%
------------------------------------------------------------------------------
V 0.375% 2.000% 1.000%
==============================================================================
The Applicable Percentage for Base Rate Loans, Eurodollar Loans, the
Letter of Credit Fees and the Commitment Fees shall, in each case, be
determined and adjusted quarterly on the date (each a "Calculation Date")
five Business Days after the date by which the Borrower is required to
provide the officer's certificate in accordance with the provisions of
Section 7.1(d); provided that the initial Applicable Percentage for Base
Rate Loans, Eurodollar Loans, the Letter of Credit Fees and the
Commitment Fees shall be based on Pricing Level IV (as shown above) and
shall remain at Pricing Level IV until the Calculation Date occurring
immediately after March 31, 1998 (unless on any Calculation Date
occurring at any time prior to March 31, 1998 the then current Leverage
Ratio is greater than 4.5 to 1.0, in which case the Applicable Percentage
for Base Rate Loans, Eurodollar Loans, Letter of Credit Fees and
Commitment Fees shall be based on Pricing Level V until the next
Calculation Date) and, thereafter, the Pricing Level shall be determined
by the then current Leverage Ratio; and provided further that if the
Borrower fails to provide the officer's certificate required by Section
7.1(d) on or before the most recent Calculation Date, the Applicable
Percentage for Base Rate Loans, Eurodollar Loans, the Letter of Credit
Fees and the Commitment Fees from such Calculation Date shall be based on
Pricing Level V until such time that an appropriate officer's certificate
is provided whereupon the Pricing Level shall be determined by the then
current Leverage Ratio. Each Applicable Percentage shall be effective
from one Calculation Date until the next Calculation Date. Any
adjustment in the Applicable Percentage shall be applicable to all
existing Loans and Letters of Credit as well as any new Loans made or
Letters of Credit issued. The Borrower shall promptly deliver to the
Administrative
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Agent at the address set forth on Schedule 11.1 and at the Agency
Services Address the information required by Section 7.1(d) in accordance
with the terms of Section 7.1(d).
"Asset Disposition" means the disposition of any or all of the
assets of a Credit Party or any of its Subsidiaries whether by sale,
lease, transfer or otherwise, other than transfers of assets permitted by
Section 8.5 and other than any losses of assets or destroyed assets
permitted by Section 7.7.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the
United States Code, as amended, modified, succeeded or replaced from time
to time.
"Bankruptcy Event" has the meaning set forth in Section 9.1(f).
"Base Rate" means, for any day, the rate per annum (rounded upwards,
if necessary, to the nearest whole multiple of 1/100 of 1%) equal to the
greater of (a) the Federal Funds Rate in effect on such day plus 1/2 of
1% or (b) the Prime Rate in effect on such day. If for any reason the
Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable after due inquiry to
ascertain the Federal Funds Rate for any reason, including the inability
or failure of the Administrative Agent to obtain sufficient quotations in
accordance with the terms of the definition of "Federal Funds Rate", the
Base Rate shall be determined without regard to clause (a) of the first
sentence of this definition until the circumstances giving rise to such
inability no longer exist. Any change in the Base Rate due to a change
in the Prime Rate or the Federal Funds Rate shall be effective on the
effective date of such change in the Prime Rate or the Federal Funds
Rate, respectively.
"Base Rate Loan" means any Loan bearing interest at a rate
determined by reference to the Base Rate.
"Borrower" means IPC, Inc., a Delaware corporation, together with
any successors and permitted assigns.
"Business Day" means any day other than a Saturday, a Sunday, a
legal holiday or a day on which banking institutions are authorized or
required by law or other governmental action to close in Charlotte, North
Carolina or New York, New York; provided that in the case of Eurodollar
Loans, such day is also a day on which dealings between banks are carried
on in U.S. dollar deposits in the London interbank market.
"Calculation Date" has the meaning set forth in the definition of
Applicable Percentage.
"Capital Expenditures" means all expenditures of Holdings and its
Subsidiaries which, in accordance with GAAP, would be classified as
capital expenditures, including, without limitation, Capital Leases.
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"Capital Lease" means, as applied to any Person, any lease of any
property (whether real, personal or mixed) by that Person as lessee
which, in accordance with GAAP, is or should be accounted for as a
capital lease on the balance sheet of that Person.
"Cash Equivalents" means (a) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the
United States of America is pledged in support thereof) having maturities
of not more than twelve months from the date of acquisition, (b) U.S.
dollar denominated time and demand deposits and certificates of deposit
of (i) any Lender, (ii) any domestic commercial bank having capital and
surplus in excess of $500,000,000 or (iii) any bank whose short-term
commercial paper rating from S&P is at least A-1 or the equivalent
thereof or from Xxxxx'x is at least P-1 or the equivalent thereof (any
such bank being an "Approved Bank"), in each case with maturities of not
more than 270 days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any Approved Bank (or by the
parent company thereof) or any variable rate notes issued by, or
guaranteed by, any domestic corporation rated A-1 (or the equivalent
thereof) or better by S&P or P-1 (or the equivalent thereof) or better by
Moody's and maturing within six months of the date of acquisition, (d)
repurchase agreements with a bank or trust company (including any of the
Lenders) or recognized securities dealer having capital and surplus in
excess of $500,000,000 for direct obligations issued by or fully
guaranteed by the United States of America in which the Borrower shall
have a perfected first priority security interest (subject to no other
Liens) and having, on the date of purchase thereof, a fair market value
of at least 100% of the amount of the repurchase obligations and (e)
Investments, classified in accordance with GAAP as current assets, in
money market investment programs registered under the Investment Company
Act of 1940, as amended, which are administered by reputable financial
institutions having capital of at least $500,000,000 and the portfolios
of which are limited to Investments of the character described in the
foregoing subdivisions (a) through (d).
"Change of Control" means any "person" or "group" (within the
meaning of Section 13(d) or 14(d) of the Exchange Act), in each case,
other than Acadia and/or Senior Management has become, directly or
indirectly, the "beneficial owner" (as defined in Rules 13d-3 and 13d-5
under the Exchange Act, except that a Person shall be deemed to have
"beneficial ownership" of all shares that any such Person has the right
to acquire, whether such right is exercisable immediately or only after
the passage of time), by way of merger, consolidation or otherwise, of
20% or more of the Voting Stock of Holdings on a fully-diluted basis,
after giving effect to the conversion and exercise of all outstanding
warrants, options and other securities of Holdings (whether or not such
securities are then currently convertible or exercisable); provided that
a change of control shall not be deemed to occur upon (a) the acquisition
by the direct or indirect partners of Acadia (or their Affiliates) of
shares of Holding's Voting Stock pursuant to a distribution made in
connection with the winding-up of Acadia or (b) the acquisition of any
Voting Stock of Holdings by any Person, the majority of the equity of
which is owned by
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Persons (or their Affiliates) that in the aggregate currently control, or
own a majority of the equity of, Acadia.
"Closing Date" means the date hereof.
"Code" means the Internal Revenue Code of 1986 and the rules and
regulations promulgated thereunder, as amended, modified, succeeded or
replaced from time to time.
"Collateral" means all collateral described in and covered by the
Collateral Documents.
"Collateral Agent" means NationsBank, N.A. (or any successor
thereto) or any successor collateral agent appointed pursuant to Section
10.9.
"Collateral Documents" means the Security Agreement, the Pledge
Agreement, the Mortgage Documents and such other documents executed and
delivered by any Credit Party in connection with the attachment and
perfection of the Lenders' security interests in the assets of the Credit
Parties, including without limitation, UCC financing statements and
patent and trademark filings with respect to the Material Intellectual
Property.
"Commitment Fees" means the fees payable to the Lenders pursuant to
Section 3.4(a).
"Commitments" means the Revolving Committed Amount, the Tranche A
Term Loan Committed Amount and the Tranche B Term Loan Committed Amount.
"Credit Documents" means this Credit Agreement, the Notes, any
Joinder Agreement, the Collateral Documents, the LOC Documents, and all
other related agreements and documents issued or delivered by any Credit
Party hereunder or thereunder or pursuant hereto or thereto.
"Credit Parties" means the Borrower and the Guarantors and "Credit
Party" means any one of them.
"Credit Party Obligations" means, without duplication, (a) all of
the obligations of the Credit Parties to the Lenders (including the
Issuing Lenders) and the Agents, whenever arising, under this Credit
Agreement, the Notes, the Collateral Documents or any of the other Credit
Documents to which the Borrower or any other Credit Party is a party
(including, but not limited to, any interest accruing after the
occurrence of a Bankruptcy Event with respect to any Credit Party,
regardless of whether such interest is an allowed claim under the
Bankruptcy Code) and (b) all liabilities and obligations owing from such
Credit Party to any Lender, or any Affiliate of a Lender, arising under
Hedging Agreements.
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"Debt Issuance" means the issuance of any Indebtedness for borrowed
money by a Credit Party or any of its Subsidiaries, other than
Indebtedness permitted by Section 8.1.
"Default" means any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" means, at any time, any Lender that, (a) has
failed to make a Loan or purchase a Participation Interest required
pursuant to the terms of this Credit Agreement (but only for so long as
such Loan is not made or such Participation Interest is not purchased),
(b) has failed to pay to the Agents or any Lender an amount owed by such
Lender pursuant to the terms of this Credit Agreement (but only for so
long as such amount has not been repaid) or (c) has been deemed insolvent
or has become subject to a bankruptcy or insolvency proceeding or to a
receiver, trustee or similar official.
"Documentation Agent" means Bankers Trust Company (or any successor
thereto) or any successor documentation agent appointed pursuant to
Section 10.9.
"Dollars" and "$" means dollars in lawful currency of the United
States of America.
"Domestic Subsidiaries" means all direct and indirect Subsidiaries
of Holdings or the Borrower that are domiciled, incorporated or organized
under the laws of any state of the United States or the District of
Columbia. As of the Closing Date, the Domestic Subsidiaries are as set
forth on Schedule 6.15.
"EBITDA" means, for any period, with respect to Holdings and its
Subsidiaries on a consolidated basis, the sum of (a) Net Income for such
period plus (b) an amount which, in the determination of Net Income for
such period has been deducted for (i) Interest Expense for such period,
(ii) total Federal, state, foreign or other income taxes for such period,
(iii) all depreciation, amortization and other non-cash charges for such
period, all as determined in accordance with GAAP, (iv) the net loss on
the sale or disposition of any real property, and (v) all extraordinary
losses, all as determined in accordance with GAAP, less (c) an amount
which, in the determination of Net Income for such period has been added
for (i) the net gain on the sale or disposition of any real property and
(ii) all extraordinary gains, all as determined in accordance with GAAP,
plus (d) the charges equal to the amount of all transaction costs
incurred by Holdings and its Subsidiaries in connection with (A) the
initial public offering of the common stock of Holdings, (B) this Credit
Agreement, (C) the redemption by Holdings of the Holdings Debentures and
(D) the payment by the Borrower of the Subordinated Notes.
"Effective Date" means the date on which the conditions set forth in
Section 5.1 shall have been fulfilled (or waived in the sole discretion
of the Lenders) and on which the initial Loans shall have been made
and/or the initial Letters of Credit shall have been issued.
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"Eligible Assignee" means (a) any Lender or Affiliate or subsidiary
of a Lender and (b) any other commercial bank, financial institution,
institutional lender or "accredited investor" (as defined in Regulation D
of the Securities and Exchange Commission) reasonably acceptable to the
Administrative Agent and the Borrower.
"Environmental Claim" means any investigation, written notice,
violation, written demand, written allegation, action, suit, injunction,
judgment, order, consent decree, penalty, fine, lien, proceeding, or
written claim whether administrative, judicial, or private in nature
arising (a) pursuant to, or in connection with, an actual or alleged
violation of, any Environmental Law, (b) in connection with any Hazardous
Material, (c) from any assessment, abatement, removal, remedial,
corrective, or other response action in connection with an Environmental
Law or other order of a Governmental Authority or (d) from any actual or
alleged damage, injury, threat, or harm to natural resources, or the
environment or health or safety from the release of any Hazardous
Materials.
"Environmental Laws" means any current or future legal requirement
of any Governmental Authority pertaining to (a) the protection of health,
safety, and the indoor or outdoor environment, (b) the conservation,
management, or use of natural resources and wildlife, (c) the protection
or use of surface water and groundwater or (d) the management,
manufacture, possession, presence, use, generation, transportation,
treatment, storage, disposal, release, threatened release, abatement,
removal, remediation or handling of, or exposure to, any Hazardous
Material or (e) pollution (including any release to air, land, surface
water and groundwater) and includes, without limitation, the
Comprehensive Environmental Response, Compensation, and Liability Act of
1980, as amended by the Superfund Amendments and Reauthorization Act of
1986, 42 USC 9601 et seq., Solid Waste Disposal Act, as amended by the
Resource Conservation and Recovery Act of 1976 and Hazardous and Solid
Waste Amendment of 1984, 42 USC 6901 et seq., Federal Water Pollution
Control Act, as amended by the Clean Water Act of 1977, 33 USC 1251 et
seq., Clean Air Act of 1966, as amended, 42 USC 7401 et seq., Toxic
Substances Control Act of 1976, 15 USC 2601 et seq., Hazardous Materials
Transportation Act, 49 USC App. 1801 et seq., Occupational Safety and
Health Act of 1970, as amended, 29 USC 651 et seq., Oil Pollution Act of
1990, 33 USC 2701 et seq., Emergency Planning and Community Right-to-Know
Act of 1986, 42 USC 11001 et seq., National Environmental Policy Act of
1969, 42 USC 4321 et seq., Safe Drinking Water Act of 1974, as amended,
42 USC 300(f) et seq., any analogous federal, state, provincial or local
or any similar, implementing or successor law, and any amendment, rule,
regulation, order, or directive issued thereunder.
"Equity Issuance" means any issuance by a Credit Party or any of its
Subsidiaries to any Person other than the Borrower or any of its
Subsidiaries of shares of its capital stock or other equity interests
whether pursuant to the exercise of options (other than stock issued to
managers, officers or directors pursuant to stock option plans or equity
plans) or warrants or pursuant to the conversion of any debt securities
to equity or otherwise.
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"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended, and any successor statute thereto, as interpreted by the
rules and regulations thereunder, all as the same may be in effect from
time to time. References to sections of ERISA shall be construed also to
refer to any successor sections.
"ERISA Affiliate" means an entity, whether or not incorporated,
which is under common control with any Credit Party or any of its
Subsidiaries within the meaning of Section 4001(a)(14) of ERISA, or is a
member of a group which includes any Credit Party or any of its
Subsidiaries and which is treated as a single employer under Sections
414(b), (c), (m), or (o) of the Code.
"Eurodollar Loan" means a Loan bearing interest based at a rate
determined by reference to the Eurodollar Rate.
"Eurodollar Rate" means, for the Interest Period for each Eurodollar
Loan comprising part of the same borrowing (including conversions,
extensions and renewals), a per annum interest rate determined pursuant
to the following formula:
Eurodollar Rate = London Interbank Offered Rate
-----------------------------
1 - Eurodollar Reserve Percentage
"Eurodollar Reserve Percentage" means for any day, that percentage
(expressed as a decimal) which is in effect from time to time under
Regulation D of the Board of Governors of the Federal Reserve System (or
any successor), as such regulation may be amended from time to time or
any successor regulation, as the maximum reserve requirement (including,
without limitation, any basic, supplemental, emergency, special, or
marginal reserves) applicable with respect to Eurocurrency liabilities as
that term is defined in Regulation D (or against any other category of
liabilities that includes deposits by reference to which the interest
rate of Eurodollar Loans is determined), whether or not Lender has any
Eurocurrency liabilities subject to such reserve requirement at that
time. Eurodollar Loans shall be deemed to constitute Eurocurrency
liabilities and as such shall be deemed subject to reserve requirements
without benefits of credits for proration, exceptions or offsets that may
be available from time to time to a Lender. The Eurodollar Rate shall be
adjusted automatically on and as of the effective date of any change in
the Eurodollar Reserve Percentage.
"Event of Default" has the meaning specified in Section 9.1 hereof.
"Excess Cash Flow" means, with respect to the Borrower and its
Subsidiaries on a consolidated basis, for any fiscal year, an amount
equal to (a) EBITDA minus (b) Capital Expenditures and Investments minus
(c) cash Interest Expense minus (d) Federal, state and other income taxes
actually paid minus (e) Principal Amortization Payment and principal
payments under other Indebtedness minus (f) voluntary prepayments made
with respect to the Term Loans minus (g) dividends paid to Holdings to
redeem Holdings
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15
Debentures or as otherwise permitted by this Credit Agreement in
accordance with the terms of this Credit Agreement unless such dividends
were a result of an increase of the Tranche B Term Loan Committed Amount
in accordance with the terms of Section 2.4(d) minus (h) so long as the
Term Loans have been paid in full, that portion of any prepayment made
with respect to the Revolving Loans to the extent the Revolving Committed
Amount is permanently reduced by such prepayment, minus (i) any excess
cash flow mandatory prepayment made or required to be made by a Foreign
Subsidiary pursuant to any agreement governing the Indebtedness permitted
by Section 8.1(j) in each case for such fiscal year.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder, as
amended, modified, succeeded or replaced from time to time.
"Existing Letters of Credit" means the letters of credit described
by date of issuance, letter of credit number, undrawn amount, name of
beneficiary and the date of expiry on Schedule 1.1(b) hereto.
"Extension of Credit" means, as to any Lender, the making of a Loan
by such Lender (or a participation therein by a Lender) or the issuance
of, or participation in, a Letter of Credit by such Lender.
"Federal Funds Rate" means for any day the rate per annum (rounded
upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members
of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business
Day next succeeding such day; provided that (a) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day and (b) if no such
rate is so published on such next preceding Business Day, the Federal
Funds Rate for such day shall be the average rate quoted to the
Administrative Agent on such day on such transactions as determined by
the Administrative Agent.
"Fee Letters" means (a) the Agents Fee Letter and (b) the
Administrative Agent Fee Letter.
"First Tier Foreign Subsidiaries" means, at any date of
determination, each Foreign Subsidiary in which any one or more of the
Borrower and its Domestic Subsidiaries owns directly more than 50%, in
the aggregate, of the Voting Stock of such Foreign Subsidiary.
"Fixed Charge Coverage Ratio" means, with respect to Holdings and
its Subsidiaries on a consolidated basis, the ratio of (a) EBITDA minus
Capital Expenditures to (b) the sum of, without duplication, (i) cash
Interest Expense plus (ii) Federal, state and other income taxes paid in
cash plus (iii) Scheduled Funded Debt Payments, (iv)
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16
repayments of Holdings Debentures provided such repayments are not made
with Tranche B Term Loan advances plus (v) cash interest due on Holdings
Debentures, as such ratio shall be calculated from time to time giving
effect to the Interim Adjustments.
"Foreign Subsidiaries" means all Subsidiaries of the Borrower that
are not Domestic Subsidiaries.
"Funded Debt" means, without duplication, the sum of (a) all
Indebtedness of Holdings and its Subsidiaries for borrowed money,
excluding intercompany items, (b) all purchase money Indebtedness of
Holdings and its Subsidiaries, (c) the principal portion of all
obligations of Holdings and its Subsidiaries under Capital Leases, (d)
(i) all obligations for unreimbursed draws on letters of credit issued
for the account of Holdings or any of its Subsidiaries (other than
letters of credit supporting trade payables in the ordinary course of
business), and (ii) all obligations, contingent or otherwise, relative to
the face amount of banker's acceptances issued for the account of
Holdings or any of its Subsidiaries, (e) all Guaranty Obligations of
Holdings and its Subsidiaries with respect to Funded Debt of another
Person, (f) all Funded Debt of another entity secured by a Lien on any
property of Holdings or any of its Subsidiaries but only to the extent of
the value of such property, whether or not such Funded Debt has been
assumed by Holdings or any of its Subsidiaries, (g) all Funded Debt of
any partnership or unincorporated joint venture to the extent Holdings or
one of its Subsidiaries is legally obligated, net of any assets of such
partnership or joint venture and (h) with respect to Holdings or any of
its Subsidiaries (other than the Indebtedness with respect to the Xxxxxx
Property permitted by Section 8.1(i)) the principal balance outstanding
under any synthetic lease, tax retention operating lease, off-balance
sheet loan or similar off-balance sheet financing product where such
transaction is considered borrowed money indebtedness for tax purposes
but is classified as an operating lease in accordance with GAAP.
"GAAP" means generally accepted accounting principles in the United
States applied on a consistent basis and subject to Section 1.3.
"Governmental Authority" means any Federal, state, local, provincial
or foreign court or governmental agency, authority, instrumentality or
regulatory body.
"Guarantor" means Holdings, each of the Domestic Subsidiaries of the
Borrower and each Additional Credit Party which has executed a Joinder
Agreement, together with their successors and assigns.
"Guaranty Obligations" means, with respect to any Person, without
duplication, any obligations (other than endorsements in the ordinary
course of business of negotiable instruments for deposit or collection)
guaranteeing or intended to guarantee any Indebtedness, leases, dividends
or other obligations of any other Person in any manner, whether direct or
indirect, and including without limitation any obligation, whether or not
contingent, (a) to purchase any such Indebtedness or other obligation or
any property constituting security therefor, (b) to advance or provide
funds or other support for the
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17
payment or purchase of such Indebtedness or obligation or to maintain
working capital, solvency or other balance sheet condition of such other
Person (including, without limitation, maintenance agreements, comfort
letters, take or pay arrangements, put agreements or similar agreements
or arrangements) for the benefit of the holder of Indebtedness of such
other Person, (c) to lease or purchase property, securities or services
primarily for the purpose of assuring the owner of such Indebtedness or
obligation, or (d) to otherwise assure or hold harmless the owner of such
Indebtedness or obligation against loss in respect thereof. The amount
of any Guaranty Obligation hereunder shall (subject to any limitations
set forth therein) be deemed to be an amount equal to the outstanding
principal amount (or maximum principal amount, if larger) of the
Indebtedness in respect of which such Guaranty Obligation is made.
"Hazardous Materials" means any substance, material or waste defined
or regulated in or under any Environmental Laws.
"Hedging Agreements" means, collectively, interest rate protection
agreements, foreign currency exchange agreements, commodity purchase or
option agreements or other interest or exchange rate or commodity price
hedging agreements, in each case, entered into or purchased by a Credit
Party.
"Holdings" means Ivex Packaging Corporation, a Delaware corporation.
"Holdings Debentures" means those certain 13 1/4% Senior Discount
Debentures due 2005 issued by Ivex Packaging Corporation f/k/a Ivex
Holdings Corporation as of March 8, 1993, as amended through the Closing
Date and as further amended, restated, substituted or replaced from time
to time in accordance with the terms of the Credit Agreement.
"Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of
such Person evidenced by bonds, debentures, notes or similar instruments,
or upon which interest payments are customarily made, (c) all obligations
of such Person under conditional sale or other title retention agreements
relating to property purchased by such Person to the extent of the value
of such property (other than customary reservations or retentions of
title under agreements with suppliers entered into in the ordinary course
of business), (d) all obligations, including without limitation
intercompany items, of such Person issued or assumed as the deferred
purchase price of property or services purchased by such Person which
would appear as liabilities on a balance sheet of such Person, (e) all
Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on, or payable out of the proceeds of production
from, property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed, (f) all Guaranty
Obligations of such Person, (g) the principal portion of all obligations
of such Person under (i) Capital Leases and (ii) any synthetic lease, tax
retention operating lease, off-balance sheet loan or similar off-balance
sheet financing product of such Person where such transaction is
considered borrowed money
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18
indebtedness for tax purposes but is classified as an operating lease in
accordance with GAAP, (h) all obligations of such Person in respect of
Hedging Agreements, (i) the maximum face amount of all performance and
standby letters of credit issued or bankers' acceptances facilities
created for the account of such Person and, without duplication, all
drafts drawn thereunder (to the extent unreimbursed), (j) all preferred
stock issued by such Person and required by the terms thereof to be
redeemed, or for which mandatory sinking fund payments are due by a fixed
date, (k) all other obligations which would be shown as a liability on
the balance sheet of such Person and (l) the aggregate amount of
uncollected accounts receivable of such Person subject at such time to a
sale of receivables (or similar transaction) regardless of whether such
transaction is effected without recourse to such Person or in a manner
that would not be reflected on the balance sheet of such Person in
accordance with GAAP. The Indebtedness of any Person shall include the
Indebtedness of any partnership or unincorporated joint venture in which
such Person is legally obligated net of any tangible assets of such
partnership or joint venture.
"Insignificant Subsidiary" means any Subsidiary of the Borrower that
(a) has assets consisting of less than 2.5% of the Total Assets and (b)
for the most recent fiscal year of the Borrower, accounted for less than
2.5% of the consolidated revenues of Holdings and its Subsidiaries and
(c) is not necessary to the ongoing business of Holdings and its
Subsidiaries taken as a whole.
"Interest Coverage Ratio" means, with respect to Holdings and its
Subsidiaries on a consolidated basis, the ratio of (a) EBITDA to (b) cash
Interest Expense, as such ratio is calculated from time to time giving
effect to the Interim Adjustments.
"Interest Expense" means, for any period, with respect to Holdings
and its Subsidiaries on a consolidated basis, all interest expense,
including the interest component under Capital Leases and Receivables
Transactions, as determined in accordance with GAAP.
"Interest Payment Date" means (a) as to Base Rate Loans, the last
day of each fiscal quarter of the Borrower and the Revolving Loan
Maturity Date, the Tranche A Term Loan Maturity Date or the Tranche B
Term Loan Maturity Date as applicable, and (b) as to Eurodollar Loans,
the last day of each applicable Interest Period and the Revolving Loan
Maturity Date, the Tranche A Term Loan Maturity Date or the Tranche B
Term Loan Maturity Date, as applicable, and in addition where the
applicable Interest Period for a Eurodollar Loan is greater than three
months, then also the date three months from the beginning of the
Interest Period and each three months thereafter.
"Interest Period" means, as to Eurodollar Loans, a period of one,
two, three or six months' duration, as the Borrower may elect,
commencing, in each case, on the date of the borrowing (including
continuations and conversions thereof); provided, however, (a) if any
Interest Period would end on a day which is not a Business Day, such
Interest Period shall be extended to the next succeeding Business Day
(except that where the next succeeding Business Day falls in the next
succeeding calendar month, then on the next
- 00 -
00
xxxxxxxxx Xxxxxxxx Xxx), (x) no Interest Period shall extend beyond the
Revolving Loan Maturity Date, the Tranche A Term Loan Maturity Date or
the Tranche B Term Loan Maturity Date as applicable, (c) with regard to
the Term Loans, no Interest Period shall extend beyond any Principal
Amortization Payment Date unless the portion of Tranche A Term Loans or
Tranche B Term Loans comprised of Base Rate Loans together with the
portion of Tranche A Term Loans or Tranche B Term Loans comprised of
Eurodollar Loans with Interest Periods expiring prior to the date such
Principal Amortization Payment is due, is at least equal to the amount of
such Principal Amortization Payment due on such date and (d) where an
Interest Period begins on a day for which there is no numerically
corresponding day in the calendar month in which the Interest Period is
to end, such Interest Period shall end on the last Business Day of such
calendar month.
"Interim Adjustments" means that, subsequent to the addition of a
New Company, the Interest Coverage Ratio, the Fixed Charge Coverage Ratio
and the Leverage Ratio shall be calculated using the adjustments and
assumptions set forth below:
EBITDA, Capital Expenditures, Interest Expense and Scheduled Funded
Debt Payments for any New Company will be calculated commencing after the
acquisition of such New Company as follows:
(a) for any partial fiscal quarter that occurs immediately
subsequent to the addition of the New Company and for the first three
full fiscal quarters subsequent to the addition of the New Company,
EBITDA, Capital Expenditures, Interest Expense and Scheduled Funded Debt
Payments for the New Company, for the quarter ending on such date, shall
be multiplied times a ratio equal to (i) 365 divided by (ii) the number
of days elapsed since the date of the addition of the New Company until
the last day of such quarter; and
(b) for the fourth full fiscal quarter subsequent to the addition of
the New Company and each fiscal quarter end thereafter, EBITDA, Capital
Expenditures, Interest Expense and Scheduled Funded Debt Payments for the
New Company shall be the actual amounts for the four quarter period
ending on such date.
"Investment" means (a) the acquisition (whether for cash, property,
services, assumption of Indebtedness, securities or otherwise) of assets,
shares of capital stock, bonds, notes, debentures, partnership, joint
ventures or other ownership interests or other securities of any Person
or (b) any deposit with, or advance, loan or other extension of credit
to, such Person (other than deposits made in connection with the purchase
of equipment or other assets in the ordinary course of business) or (c)
any other capital contribution to or investment in such Person,
including, without limitation, any Guaranty Obligation (including any
support for a Letter of Credit issued on behalf of such Person) incurred
for the benefit of such Person.
"Issuing Lender" means (a) with respect to certain Existing Letters
of Credit, Societe Generale, Southwest Agency and (b) with respect to
certain Existing Letters of
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20
Credit and any new Letters of Credit, NationsBank, N.A. or any successor
Administrative Agent.
"Issuing Lender Fees" has the meaning set forth in Section 3.4(b).
"Joinder Agreement" means a Joinder Agreement substantially in the
form of Exhibit 7.13.
"Leasehold Mortgage" has the meaning set forth in Section 5.1(e).
"Leasehold Mortgaged Properties" has the meaning set forth in Section
5.1(e).
"Lender" means any of the Persons identified as a "Lender" on the
signature pages hereto, and any Person which may become a Lender by way
of assignment in accordance with the terms of Section 11.3, together with
their successors and permitted assigns.
"Letter of Credit" means (a) any standby or commercial letter of
credit issued for the account of the Borrower by an Issuing Lender
pursuant to Section 2.2, as such letters of credit may be amended,
modified, extended, renewed or replaced and (b) any Existing Letter of
Credit.
"Letter of Credit Fees" has the meaning assigned to such term in
Section 3.4(b).
"Leverage Ratio" means, with respect to Holdings and its
Subsidiaries on a consolidated basis, the ratio of (a) Funded Debt on
such date to (b) EBITDA for the twelve month period ending on such date,
as such ratio is calculated from time to time giving effect to Interim
Adjustments.
"Lien" means any mortgage, pledge, hypothecation, assignment,
deposit arrangement, security interest, encumbrance, lien (statutory or
otherwise), preference, priority or charge of any kind, including,
without limitation, any agreement to give any of the foregoing, any
conditional sale or other title retention agreement, and any lease in the
nature thereof.
"Loan" or "Loans" means the Revolving Loans, the Tranche A Term
Loans and/or the Tranche B Term Loans (or a portion of any Revolving
Loan, the Tranche A Term Loans or the Tranche B Term Loans), individually
or collectively, as appropriate.
"LOC Documents" means, with respect to any Letter of Credit, such
Letter of Credit, any amendments thereto, any documents delivered in
connection therewith, any application therefor, and any agreements,
instruments, guarantees or other documents (whether general in
application or applicable only to such Letter of Credit) governing or
providing for (a) the rights and obligations of the parties concerned or
at risk or (b) any collateral security for such obligations.
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21
"LOC Obligations" means, at any time, the sum of (a) the maximum
amount which is, or at any time thereafter may become, available to be
drawn under Letters of Credit then outstanding, assuming compliance with
all requirements for drawings referred to in such Letters of Credit plus
(b) the aggregate amount of all drawings under Letters of Credit honored
by an Issuing Lender but not theretofore reimbursed.
"LOC Participants" means the Lenders whose Revolving Loan Commitment
Percentage is greater than zero.
"London Interbank Offered Rate" means, with respect to any
Eurodollar Loan for the Interest Period applicable thereto, the rate of
interest per annum (rounded upwards, if necessary, to the nearest 1/100
of 1%) appearing on Telerate Page 3750 (or any successor page) as the
London interbank offered rate for deposits in Dollars at approximately
11:00 A.M. (London time) two Business Days prior to the first day of such
Interest Period for a term comparable to such Interest Period; provided,
however, if more than one rate is specified on Telerate Page 3750, the
applicable rate shall be the arithmetic mean of all such rates. If, for
any reason, such rate is not available, the term "London Interbank
Offered Rate" shall mean, with respect to any Eurodollar Loan for the
Interest Period applicable thereto, the rate of interest per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on
Reuters Screen LIBO Page as the London interbank offered rate for
deposits in Dollars at approximately 11:00 A.M. (London time) two
Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period; provided, however, if more than one
rate is specified on Reuters Screen LIBO Page, the applicable rate shall
be the arithmetic mean of all such rates.
"Management" means any current officer or director of the Borrower.
"Mandatory Borrowing" has the meaning set forth in Section 2.2(e).
"Margin Stock" means "margin stock" as defined in Regulation U,
Regulation X or Regulation G.
"Material Adverse Effect" means a material adverse effect, after
taking into account applicable insurance, if any, on (a) the operations,
financial condition or business or prospects of Holdings and its
Subsidiaries taken as a whole, (b) the ability of a Credit Party to
perform in any material respect its respective obligations under this
Credit Agreement or any of the other Credit Documents, or (c) the
validity or enforceability of this Credit Agreement, any of the other
Credit Documents, or the rights and remedies of the Lenders hereunder or
thereunder taken as a whole.
"Material Intellectual Property" has the meaning set forth in the
Security Agreement.
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22
"Moody's" means Xxxxx'x Investors Service, Inc., or any successor or
assignee of the business of such company in the business of rating
securities.
"Mortgage Documents" means the Mortgages, the Leasehold Mortgages
and such other documents and agreements executed or delivered by any
Credit Party in connection with the Real Properties.
"Mortgage Policies" has the meaning set forth in Section 5.1(e).
"Mortgages" has the meaning set forth in Section 5.1(e).
"Mortgaged Properties" has the meaning set forth in Section 5.1(e).
"Multiemployer Plan" means a Plan covered by Title IV of ERISA which
is a multiemployer plan as defined in Section 3(37) or 4001(a)(3) of
ERISA.
"Multiple Employer Plan" means a Plan covered by Title IV of ERISA,
other than a Multiemployer Plan, which any Credit Party or any of its
Subsidiaries or any ERISA Affiliate and at least one employer other than
a Credit Party or any of its Subsidiaries or any ERISA Affiliate are
contributing sponsors.
"Net Cash Proceeds" means the gross cash proceeds (including cash
actually received by way of deferred payment pursuant to a promissory
note, receivable, or otherwise) received from an Asset Disposition, an
Equity Issuance or a Debt Issuance, net of (a) transaction costs payable
to third parties, (b) a good faith estimate of the taxes payable with
respect to such proceeds (including, without duplication, withholding
taxes) and (c) with respect to any Asset Disposition, the outstanding
Indebtedness (other than the Loans) required to be repaid as a result of
such Asset Disposition.
"Net Income" means, for any period, the net income after taxes for
such period of Holdings and its Subsidiaries on a consolidated basis, as
determined in accordance with GAAP.
"Net Worth" means, as of any date, shareholders' equity or net worth
of Holdings and its Subsidiaries on a consolidated basis, as determined
in accordance with GAAP.
"New Company" means a Person that is acquired by, and becomes a
Subsidiary of, a Credit Party (or a Subsidiary that is established to
purchase the assets of another Person) as long as, during the first four
full fiscal quarters subsequent to such acquisition, it remains a
separate Subsidiary of a Credit Party.
"Xxxxxx Property" means the property leased by the Borrower located
in Newton, Massachusetts.
"Non-Excluded Taxes" has the meaning set forth in Section 3.13.
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23
"Note" or "Notes" means the Revolving Notes, the Tranche A Term
Notes and/or the Tranche B Term Notes, individually or collectively, as
appropriate.
"Notice of Borrowing" means a request by the Borrower for a
Revolving Loan, in the form of Exhibit 2.1(b).
"Notice of Continuation/Conversion" means a request by the Borrower
to continue an existing Eurodollar Loan to a new Interest Period or to
convert a Eurodollar Loan to a Base Rate Loan or a Base Rate Loan to a
Eurodollar Loan, in the form of Exhibit 2.1(e).
"Participation Interest" means the Extension of Credit by a Lender
by way of a purchase of a participation in Letters of Credit or LOC
Obligations as provided in Section 2.2 or in any Loans as provided in
Section 3.8.
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA and any successor thereto.
"Permitted Acquisition" means an acquisition of all or part of the
assets or stock of another Person by a Credit Party or any Subsidiary;
provided that after giving effect to such acquisition (a) there is at
least $25,000,000 of availability under the Revolving Committed Amount,
(b) the Borrower and its Subsidiaries are in compliance, on a Pro Forma
Basis, with all of the covenants set forth in Section 7.2, (c) the
Collateral Agent shall have received all items in respect of the assets
or stock acquired in such acquisition required to be delivered by Section
7.13, (d) in the case of an acquisition of the stock of another Person,
the board of directors (or other comparable governing body) or
stockholders, as appropriate, of such Person shall have approved such
acquisition, (e) no Change of Control shall have occurred, (f) not
including any acquisition or a portion thereof made with the issuance of
capital stock, the total cost of any one acquisition shall not exceed
$40,000,000, and together with other acquisitions made by the Credit
Parties or any of their Subsidiaries during such calendar year, the
aggregate acquisition costs of the Credit Parties and their Subsidiaries
taken as a whole shall not exceed $75,000,000 and (g) no Default or Event
of Default exists and is continuing.
"Permitted Investments" means Investments which are (a) cash or Cash
Equivalents, (b) accounts receivable created, acquired or made in the
ordinary course of business and payable or dischargeable in accordance
with customary trade terms, (c) Investments in a Guarantor (other than
Holdings), (d) loans to directors, officers, employees, agents, customers
or suppliers in the ordinary course of business for reasonable business
expenses, (e) loans to Management to finance purchases (or tax
obligations relating to such purchases) of Holdings' capital stock not to
exceed $15,000,000, in the aggregate, at any one time, (f) Permitted
Acquisitions, (g) Investments in foreign joint ventures not to exceed
$10,000,000, in the aggregate, at any one time, (h) the purchase of stock
or options of Holdings by Holdings from (i)
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24
employees who voluntarily or involuntarily terminate their employment
with the Borrower or any of its Subsidiaries or (ii) Senior Management,
subsequent to the Closing Date, not to exceed $5,000,000 in the
aggregate, (i) the redemption of Subordinated Debt as permitted by this
Credit Agreement, (j) the Investments set forth on Schedule 8.7, (k)
Investments in other Credit Parties and their Subsidiaries subject to
Section 8.15 and (l) the purchase of other securities not to exceed
$5,000,000 in the aggregate.
"Permitted Liens" means (a) Liens securing Credit Party Obligations,
(b) Liens for taxes not yet due or Liens for taxes being contested in
good faith by appropriate proceedings for which adequate reserves
determined in accordance with GAAP have been established (and as to which
the property subject to any such Lien is not yet subject to foreclosure,
sale, collection, levy or loss on account thereof), (c) Liens in respect
of property imposed by law arising in the ordinary course of business
such as materialmen's, mechanics', warehousemen's, carrier's, landlords'
and other nonconsensual statutory Liens and other like Liens which are
not delinquent for a period of more than sixty days or, if due and
payable, are being contested in good faith by appropriate proceedings for
which adequate reserves determined in accordance with GAAP in effect from
time to time have been established (and as to which the property subject
to any such Lien is not yet subject to foreclosure, sale or loss on
account thereof), (d) pledges or deposits made in the ordinary course of
business to secure payment of worker's compensation insurance,
unemployment insurance, pensions or social security programs, (e) Liens
arising from good faith deposits in connection with or to secure
performance of tenders, bids, leases, government contracts, performance
and return-of-money bonds and other similar obligations incurred in the
ordinary course of business (other than obligations in respect of the
payment of borrowed money), (f) Liens arising from good faith deposits in
connection with or to secure performance of statutory obligations and
surety and appeal bonds, (g) easements, rights-of-way, restrictions
(including zoning restrictions), matters of plat, minor defects or
irregularities in title and other similar charges or encumbrances not, in
any material respect, impairing the use of the encumbered property for
its intended purposes, (h) judgment Liens that would not constitute an
Event of Default, (i) Liens on receivables sold pursuant to a Receivables
Transaction, (j) Liens in connection with Indebtedness permitted by
Section 8.1(e), 8.1(i) and 8.1(j), (k) Liens constituting intellectual
property licenses entered into in the ordinary course of business, (l)
Liens on the real property of a corporation which becomes a Subsidiary of
the Borrower or is merged with or into a Credit Party after the Closing
Date that secures Indebtedness permitted by Section 8.1(h); provided,
that (i) such Liens existed at the time such corporation became a
Subsidiary of the Borrower or was merged with or into a Credit Party and
were not created in anticipation thereof, (ii) such Liens do not extend
to any property other than the actual property acquired in connection
with such acquisition and (iii) at such time, no Default or Event of
Default exists or shall result from such transaction; (m) Liens arising
by virtue of any statutory or common law provision relating to banker's
liens, rights of setoff or similar rights as to deposit accounts or other
funds maintained with a creditor depository institution, (n) Liens
existing on the Closing Date and identified on Schedule 8.2 and (o) any
Liens granted in connection with any amendment, restatement, supplement,
renewal, replacement, extension or refunding (or
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successive amendments, restatements, supplements, renewals, replacements,
extensions or refundings) in whole or part of any such Liens or the
Indebtedness permitted by Section 8.1(b); provided that the principal
amount of Indebtedness secured by any such Lien does not exceed the
principal amount of such Indebtedness outstanding immediately prior to
such amendment, restatement, supplement, renewal, replacement, extension
or refunding.
"Person" means any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other
enterprise (whether or not incorporated), or any Governmental Authority.
"Plan" means any employee benefit plan (as defined in Section 3(3)
of ERISA) which is covered by ERISA and with respect to which any Credit
Party or any of its Subsidiaries or any ERISA Affiliate is (or, if such
plan were terminated at such time, would under Section 4069 of ERISA be
deemed to be) an "employer" within the meaning of Section 3(5) of ERISA.
"Pledge Agreement" means the Amended and Restated Pledge Agreement
executed and delivered by each of the applicable Credit Parties in favor
of the Collateral Agent, for the benefit of the Lenders, to secure their
obligations under the Credit Documents, as amended, modified, extended,
renewed or replaced from time to time.
"Prime Rate" means the per annum rate of interest established from
time to time by the Administrative Agent at its principal office in
Charlotte, North Carolina (or such other principal office of the
Administrative Agent as communicated in writing to the Borrower and the
Lenders) as its Prime Rate. Any change in the interest rate resulting
from a change in the Prime Rate shall become effective as of 12:01 a.m.
of the Business Day on which each change in the Prime Rate is announced
by the Administrative Agent. The Prime Rate is a reference rate used by
the Administrative Agent in determining interest rates on certain loans
and is not intended to be the lowest rate of interest charged on any
extension of credit to any debtor.
"Principal Amortization Payment" means a principal payment on the
Term Loans as set forth in Section 2.3(c) or 2.4(c).
"Principal Amortization Payment Date" means the date a Principal
Amortization Payment is due.
"Pro Forma Basis" means, with respect to a Permitted Acquisition,
that such Permitted Acquisition shall be deemed to have occurred as of
the first day of the four fiscal quarter period ending as of the last day
of the most recent fiscal quarter for which the Lenders have received the
financial information required by Section 7.1(b).
"Real Properties" means the Mortgaged Properties, the Leasehold
Mortgaged Properties and the Other Leasehold Properties.
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"Receivables Transaction" means a transaction in which a Credit
Party sells or grants a security interest in its trade receivables, to
the extent such transaction has been approved by the Required Lenders in
their sole discretion.
"Regulation D, G, U, T or X" means Regulation D, G, U, T or X,
respectively, of the Board of Governors of the Federal Reserve System as
from time to time in effect and any successor to all or a portion
thereof.
"Reportable Event" means a "reportable event" as defined in Section
4043 of ERISA with respect to which the notice requirements to the PBGC
have not been waived.
"Required Lenders" means Lenders whose aggregate Credit Exposure (as
hereinafter defined) constitutes at least 51% of the Credit Exposure of
all Lenders at such time; provided, however, that if any Lender shall be
a Defaulting Lender at such time then there shall be excluded from the
determination of Required Lenders the aggregate principal amount of
Credit Exposure of such Lender at such time. For purposes of the
preceding sentence, the term "Credit Exposure" as applied to each Lender
shall mean (a) at any time prior to the termination of the Commitments,
the sum of (i) the Revolving Commitment Percentage of such Lender
multiplied by the Revolving Committed Amount, plus (ii) the Tranche A
Term Loan Commitment Percentage of such Lender multiplied by the
aggregate principal amount of Tranche A Term Loans outstanding at such
time, plus (iii) the Tranche B Term Loan Commitment Percentage of such
Lender multiplied by the aggregate principal amount of Tranche B Term
Loans outstanding at such time and (b) at any time after the termination
of the Commitments, the sum of (i) the principal balance of the
outstanding Loans of such Lender plus (ii) such Lender's Participation
Interests in the face amount of the outstanding Letters of Credit.
"Requirement of Law" means, as to any Person, the articles or
certificate of incorporation and by-laws or other organizational or
governing documents of such Person, and any law, treaty, rule or
regulation or final, non-appealable determination of an arbitrator or a
court or other Governmental Authority, in each case applicable to or
binding upon such Person or to which any of its material property is
subject.
"Revolving Committed Amount" means ONE HUNDRED SEVENTY FIVE MILLION
DOLLARS ($175,000,000) or such lesser amount as the Revolving Committed
Amount may be reduced pursuant to Section 2.1(d) or Section 3.3(c).
"Revolving Loan Commitment Percentage" means, for each Lender, the
percentage identified as its Revolving Commitment Percentage on Schedule
1.1(a), as such percentage may be modified in connection with any
assignment made in accordance with the provisions of Section 11.3.
"Revolving Loan Maturity Date" means October ___, 2003.
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"Revolving Loans" means the Revolving Loans made to the Borrower
pursuant to Section 2.1.
"Revolving Note" or "Revolving Notes" means the promissory notes of
the Borrower in favor of each of the Lenders evidencing the Revolving
Loans provided pursuant to Section 2.1, individually or collectively, as
appropriate, as such promissory notes may be amended, modified,
supplemented, extended, renewed or replaced from time to time and as
evidenced in the form of Exhibit 2.1(e).
"S&P" means Standard & Poor's Ratings Group, a division of McGraw
Hill, Inc., or any successor or assignee of the business of such division
in the business of rating securities.
"Scheduled Funded Debt Payments" means, as of the date of
determination, for Holdings and its Subsidiaries on a consolidated basis,
the sum of all scheduled payments of principal on Funded Debt for the
twelve month period ending on the date of determination (including the
principal component of payments due on leases that are required to be
capitalized in accordance with GAAP during the twelve month period ending
on the date of determination); it being understood that Scheduled Funded
Debt Payments shall not include voluntary prepayments or the mandatory
prepayments required pursuant to Section 3.3.
"Securities Act" means the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
"Security Agreement" means the Amended and Restated Security
Agreement executed and delivered by each of the Credit Parties in favor
of the Collateral Agent for the benefit of the Lenders to secure their
obligations under the Credit Documents, as such may be amended, modified,
extended, renewed, restated or replaced from time to time.
"Senior Management" means those certain directors of Holdings
identified in the section entitled "Management Section" in that certain
Registration Statement on Form S-1 effective with the Securities and
Exchange Commission on September ___, 1997.
"Single Employer Plan" means any Plan which is covered by Title IV
of ERISA, but which is not a Multiemployer Plan.
"Solvent" means, with respect to any Person as of a particular date,
that on such date (a) such Person is able to pay its debts and other
liabilities, contingent obligations and other commitments as they mature
in the normal course of business, (b) such Person does not intend to, and
does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature in their
ordinary course, (c) such Person is not engaged in a business or a
transaction, and is not about to engage in a business or a transaction,
for which such Person's assets would constitute unreasonably small
capital after giving due consideration to the prevailing practice in the
industry in
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which such Person is engaged or is to engage, (d) the fair value of the
assets of such Person is greater than the total amount of liabilities,
including, without limitation, contingent liabilities, of such Person and
(e) the present fair saleable value of the assets of such Person is not
less than the amount that will be required to pay the probable liability
of such Person on its debts as they become absolute and matured. In
computing the amount of contingent liabilities at any time, it is
intended that such liabilities will be computed at the amount which, in
light of all the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an actual
or matured liability.
"Subordinated Debt" means the Holdings Debentures and the
Subordinated Notes, as such may be amended, modified, restated,
substituted or replaced from time to time in accordance with the terms of
this Credit Agreement.
"Subordinated Notes" means those certain 12 1/2% Senior Subordinated
Notes due 2002 issued by IPC, Inc. f/k/a Ivex Packaging Corporation as
Issuer as of December 15, 1992 as amended through the Closing Date and as
further amended, modified, restated, substituted or replaced from time to
time in accordance with the terms of this Credit Agreement.
"Subordinated Notes Call Date" means December 15, 1997 or such other
Business Day (prior to December 31, 1997) as requested in writing by the
Borrower at least one Business Day prior thereto in order to repurchase
all of the then outstanding Subordinated Notes.
"Subsidiary" means, as to any Person, (a) any corporation more than
50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such
corporation (irrespective of whether or not at the time, any class or
classes of such corporation shall have or might have voting power by
reason of the happening of any contingency) is at the time owned by such
Person directly or indirectly through Subsidiaries, and (b) any
partnership, association, joint venture or other entity in which such
person directly or indirectly through Subsidiaries has more than a 50%
equity interest at any time.
"Term Loans" means the Tranche A Term Loans and the Tranche B Term
Loans.
"Termination Event" means (a) with respect to any Single Employer
Plan, the occurrence of a Reportable Event or the substantial cessation
of operations (within the meaning of Section 4062(e) of ERISA); (b) the
withdrawal of any Credit Party or any of its Subsidiaries or any ERISA
Affiliate from a Multiple Employer Plan during a plan year in which it
was a substantial employer (as such term is defined in Section 4001(a)(2)
of ERISA), or the termination of a Multiple Employer Plan; (c) the
distribution of a notice of intent to terminate or the actual termination
of a Plan pursuant to Section 4041(a)(2) or 4041A of ERISA; (d) the
institution of proceedings to terminate or the actual termination of a
Plan by the PBGC under Section 4042 of ERISA; (e) any event or condition
which
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might reasonably constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan;
or (f) the complete or partial withdrawal of any Credit Party or any of
its Subsidiaries or any ERISA Affiliate from a Multiemployer Plan.
"Title Properties" has the meaning set forth in Section 5.1(e).
"Total Assets" means, as of any date, all items which, in accordance
with GAAP, would be classified as assets of Holdings and its Subsidiaries
on a consolidated basis.
"Tranche A Term Loans" means the Term Loans made to the Borrower
pursuant to Section 2.3(a).
"Tranche A Term Loan Commitment Percentage" means, for each Lender,
the percentage identified as its Tranche A Term Loan Commitment
Percentage on Schedule 1.1(a), as such percentage may be modified in
connection with any assignment made in accordance with the provisions of
Section 11.3.
"Tranche A Term Loan Committed Amount" means ONE HUNDRED FIFTY
MILLION DOLLARS ($150,000,000).
"Tranche A Term Loan Maturity Date" means October ___, 2003.
"Tranche A Term Note" or "Tranche A Term Notes" means the amended
and restated promissory notes of the Borrower in favor of each of the
Lenders evidencing the Tranche A Term Loans provided pursuant to Section
2.3(a), individually or collectively, as appropriate, as such promissory
notes may be amended, modified, supplemented, extended, renewed or
replaced from time to time.
"Tranche B Term Loans" means the Term Loans made to the Borrower
pursuant to Section 2.4(a).
"Tranche B Term Loan Commitment Percentage" means, for each Lender,
the percentage identified as its Tranche B Term Loan Commitment
Percentage on Schedule 1.1(a), as such percentage may be modified in
connection with any assignment made in accordance with the provisions of
Section 11.3.
"Tranche B Term Loan Committed Amount" means ONE HUNDRED FIFTY
MILLION DOLLARS ($150,000,000) less the amount of Holdings Debentures not
tendered on the Tranche B Term Loan Funding Date; provided that the
Tranche B Term Loan Committed Amount may be increased subsequent to the
Closing Date in accordance with the terms of Section 2.4(d).
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"Tranche B Term Loan Funding Date" means any date no later than
thirty (30) days from the Closing Date selected by the Borrower upon
three Business Days prior written notice to the Administrative Agent.
"Tranche B Term Loan Maturity Date" means October ___, 2004.
"Tranche B Term Note" or "Tranche B Term Notes" means the amended
and restated promissory notes of the Borrower in favor of each of the
Lenders evidencing the Tranche B Term Loans provided pursuant to Section
2.4(a), individually or collectively, as appropriate, as such promissory
notes may be amended, modified, supplemented, extended, renewed or
replaced from time to time.
"Unused Commitment" means, for any period, the sum of (a) the amount
by which (i) the then applicable aggregate Revolving Committed Amount
exceeds (ii) the daily average sum for such period of the outstanding
aggregate principal amount of all Revolving Loans plus the aggregate
amount of LOC Obligations outstanding and (b) prior to the earlier of (I)
the actual Subordinated Notes Call Date and (II) December 31, 1997, the
amount by which the (i) Tranche A Term Loan Committed Amount exceeds (ii)
the aggregate principal amount of the Tranche A Term Loans made on the
Effective Date.
"Voting Stock" of a corporation means all classes of the capital
stock of such corporation then outstanding and normally entitled to vote
in the election of directors.
1.2 COMPUTATION OF TIME PERIODS AND OTHER DEFINITIONAL PROVISIONS.
For purposes of computation of periods of time hereunder, the word "from"
means "from and including" and the words "to" and "until" each mean "to but
excluding." References in this Agreement to "Articles", "Sections",
"Schedules" or "Exhibits" shall be to Articles, Sections, Schedules or Exhibits
of or to this Agreement unless otherwise specifically provided.
1.3 ACCOUNTING TERMS.
Except as otherwise expressly provided herein, all accounting terms used
herein shall be interpreted, and all financial statements and certificates and
reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis. All calculations made for the purposes of determining compliance with
this Credit Agreement shall (except as otherwise expressly provided herein) be
made by application of GAAP applied on a basis consistent with the most recent
annual or quarterly financial statements delivered pursuant to Section 7.1 (or,
prior to the delivery of the first financial statements pursuant to Section
7.1, consistent with the financial statements described in Section 5.1(g);
provided, however, if (a) the Borrower shall object to determining such
compliance on such basis at the time of delivery of such financial statements
due to any change in GAAP or the rules promulgated with respect thereto or (b)
the Administrative Agent or the Required Lenders shall so object in writing
within 30 days after delivery of such financial statements, then such
calculations shall be made on a basis consistent with GAAP as in effect as
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of the date of the most recent financial statements delivered by the Borrower
to the Lenders to which no such objection shall have been made.
SECTION 2
CREDIT FACILITIES
2.1 REVOLVING LOANS.
(a) Revolving Loan Commitment. Subject to the terms and conditions
set forth herein, each Lender who has a Revolving Loan Commitment
Percentage that is greater than zero (the "Revolving Loan Lenders")
severally agrees to make revolving loans (each a "Revolving Loan" and
collectively the "Revolving Loans") to the Borrower, in Dollars, at any
time and from time to time, during the period from and including the
Effective Date to but not including the Revolving Loan Maturity Date (or
such earlier date if the Revolving Committed Amount has been terminated
as provided herein) equal to its Revolving Loan Commitment Percentage of
each of the Revolving Loans requested by the Borrower; provided, however,
that (i) the sum of the aggregate amount of Revolving Loans outstanding
plus the aggregate amount of LOC Obligations outstanding shall not exceed
the Revolving Committed Amount and (ii) with respect to each individual
Revolving Loan Lender, the Revolving Loan Lender's pro rata share of
outstanding Revolving Loans plus such Revolving Loan Lender's pro rata
share of outstanding LOC Obligations shall not exceed such Revolving Loan
Lender's Revolving Loan Commitment Percentage of the Revolving Committed
Amount. Subject to the terms of this Credit Agreement (including Section
3.3), the Borrower may borrow, repay and reborrow Revolving Loans.
(b) Method of Borrowing for Revolving Loans. By no later than 11:00
a.m. (i) on the date of the requested borrowing of Revolving Loans that
will be Base Rate Loans or (ii) three Business Days prior to the date of
the requested borrowing of Revolving Loans that will be Eurodollar Loans,
the Borrower shall submit a written Notice of Borrowing in the form of
Exhibit 2.1(b) to the Administrative Agent setting forth (A) the amount
requested, (B) whether such Revolving Loans shall accrue interest at the
Adjusted Base Rate or the Adjusted Eurodollar Rate, (C) with respect to
Revolving Loans that will be Eurodollar Loans, the Interest Period
applicable thereto and (D) certification that the Borrower has complied
in all respects with Section 5.2. All Revolving Loans made on the
Effective Date shall be Base Rate Loans. Thereafter, all or any portion
of such Revolving Loans may be converted into Eurodollar Loans in
accordance with the terms of Section 2.5.
(c) Funding of Revolving Loans. Upon receipt of a Notice of
Borrowing, the Administrative Agent shall promptly inform the Lenders as
to the terms thereof. Each Lender shall make its Revolving Loan
Commitment Percentage of the requested Revolving Loans available to the
Administrative Agent by 2:00 p.m. on the date specified
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in the Notice of Borrowing by deposit, in Dollars, of immediately
available funds at the offices of the Administrative Agent at its
principal office in Charlotte, North Carolina or at such other address as
the Administrative Agent may designate in writing. The amount of the
requested Revolving Loans will then be made available to the Borrower by
the Administrative Agent by crediting the account of the Borrower on the
books of such office of the Administrative Agent, to the extent the
amount of such Revolving Loans are made available to the Administrative
Agent.
No Lender shall be responsible for the failure or delay by any other
Lender in its obligation to make Revolving Loans hereunder; provided,
however, that the failure of any Lender to fulfill its obligations
hereunder shall not relieve any other Lender of its obligations
hereunder. Unless the Administrative Agent shall have been notified by
any Lender prior to the date of any such Revolving Loan that such Lender
does not intend to make available to the Administrative Agent its portion
of the Revolving Loans to be made on such date, the Administrative Agent
may assume that such Lender has made such amount available to the
Administrative Agent on the date of such Revolving Loans, and the
Administrative Agent in reliance upon such assumption, may (in its sole
discretion but without any obligation to do so) make available to the
Borrower a corresponding amount. If such corresponding amount is not in
fact made available to the Administrative Agent, the Administrative Agent
shall be able to recover such corresponding amount from such Lender. If
such Lender does not pay such corresponding amount forthwith upon the
Administrative Agent's demand therefor, the Administrative Agent will
promptly notify the Borrower, and the Borrower shall immediately pay such
corresponding amount to the Administrative Agent. The Administrative
Agent shall also be entitled to recover from the Lender or the Borrower,
as the case may be, interest on such corresponding amount in respect of
each day from the date such corresponding amount was made available by
the Administrative Agent to the Borrower to the date such corresponding
amount is recovered by the Administrative Agent at a per annum rate equal
to (i) from the Borrower at the applicable rate for such Revolving Loan
pursuant to the Notice of Borrowing and (ii) from a Lender at the Federal
Funds Rate.
(d) Reductions of Revolving Committed Amount. Upon at least three
Business Days' notice, the Borrower shall have the right to permanently
terminate or reduce the aggregate unused amount of the Revolving
Committed Amount at any time or from time to time; provided that (i) each
partial reduction shall be in an aggregate amount at least equal to
$5,000,000 and in integral multiples of $1,000,000 above such amount and
(ii) no reduction shall be made which would reduce the Revolving
Committed Amount to an amount less than the aggregate amount of
outstanding Revolving Loans plus the aggregate amount of outstanding LOC
Obligations. Any reduction in (or termination of) the Revolving Committed
Amount shall be permanent and may not be reinstated. The Administrative
Agent shall immediately notify the Lenders of any reduction in the
Revolving Committed Amount.
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(e) Notes. The Revolving Loans made by each Lender shall be
evidenced by a duly executed promissory note of the Borrower to each
applicable Lender in the face amount of its Revolving Loan Commitment
Percentage of the Revolving Committed Amount in substantially the form of
Exhibit 2.1(e).
2.2 LETTER OF CREDIT SUBFACILITY.
(a) Issuance. Subject to the terms and conditions hereof and of the
LOC Documents, if any, and any other terms and conditions which the
Issuing Lenders may reasonably require (so long as such terms and
conditions do not impose any financial obligation on or require any Lien
(not otherwise contemplated by this Credit Agreement) to be given by any
Credit Party or conflict with any obligation of, or detract from any
action which may be taken by, any Credit Party or their Subsidiaries
under this Credit Agreement), an Issuing Lender, as applicable, shall
from time to time upon request issue (from the Effective Date to the
Revolving Loan Maturity Date and in a form reasonably acceptable to the
applicable Issuing Lender), in Dollars, and the LOC Participants shall
participate in, letters of credit (the "Letters of Credit") for the
account of the Borrower; provided, however, that (i) the aggregate amount
of LOC Obligations shall not at any time exceed SIXTY FIVE MILLION
DOLLARS ($65,000,000), (ii) the sum of the aggregate amount of LOC
Obligations outstanding plus Revolving Loans outstanding shall not exceed
the Revolving Committed Amount and (iii) with respect to each individual
LOC Participant, the LOC Participant's pro rata share of outstanding
Revolving Loans plus its pro rata share of outstanding LOC Obligations
shall not exceed such LOC Participant's Revolving Loan Commitment
Percentage of the Revolving Committed Amount. The issuance and expiry
date of each Letter of Credit shall be a Business Day. Except as
otherwise expressly agreed upon by all the LOC Participants, no Letter of
Credit shall have an original expiry date more than one year from the
date of issuance, or as extended, shall have an expiry date extending
beyond the Revolving Loan Maturity Date. Each Letter of Credit shall be
either (x) a standby letter of credit issued to support the obligations
(including pension or insurance obligations), contingent or otherwise, of
the Borrower or any of its Subsidiaries, or (y) a commercial letter of
credit in respect of the purchase of goods or services by the Borrower or
any of its Subsidiaries in the ordinary course of business. Each Letter
of Credit shall comply with the related LOC Documents.
(b) Notice and Reports. The request for the issuance of a Letter of
Credit shall be submitted to the applicable Issuing Lender at least three
Business Days prior to the requested date of issuance. The Issuing
Lenders will, at least quarterly and more frequently upon request,
provide to the Administrative Agent for dissemination to the Lenders a
detailed report specifying the Letters of Credit which are then issued
and outstanding and any activity with respect thereto which may have
occurred since the date of the prior report, and including therein, among
other things, the account party, the beneficiary, the face amount, and
the expiry date as well as any payments or expirations which may have
occurred. The Issuing Lenders will further provide to the Administrative
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Agent, promptly upon request, copies of the Letters of Credit and the
other LOC Documents.
(c) Participations.
(i) Each LOC Participant acknowledges and confirms that it has
a Participation Interest in the liability of the applicable Issuing
Lender under each Existing Letter of Credit in an amount equal to
its Revolving Loan Commitment Percentage of such Existing Letters
of Credit. Each Existing Letter of Credit shall be governed by the
terms of this Credit Agreement.
(ii) Each LOC Participant, upon issuance of a Letter of
Credit, shall be deemed to have purchased without recourse a risk
participation from the applicable Issuing Lender in such Letter of
Credit and each LOC Document related thereto and the rights and
obligations arising thereunder and any collateral relating thereto,
in each case in an amount equal to its Revolving Loan Commitment
Percentage of the obligations under such Letter of Credit, and
shall absolutely, unconditionally and irrevocably assume, as
primary obligor and not as surety, and be obligated to pay to the
applicable Issuing Lender therefor and discharge when due, its
Revolving Loan Commitment Percentage of the obligations arising
under such Letter of Credit. Without limiting the scope and nature
of each LOC Participant's participation in any Letter of Credit, to
the extent that an Issuing Lender has not been reimbursed as
required hereunder or under any such Letter of Credit, each such
LOC Participant shall pay to an Issuing Lender its Revolving Loan
Commitment Percentage of such unreimbursed drawing in same day
funds on the day of notification by such Issuing Lender of an
unreimbursed drawing pursuant to the provisions of subsection (d).
The obligation of each LOC Participant to so reimburse an Issuing
Lender shall be absolute and unconditional and shall not be
affected by the occurrence of a Default, an Event of Default or any
other occurrence or event. Any such reimbursement shall not
relieve or otherwise impair the obligation of the Borrower or any
other Credit Party to reimburse such Issuing Lender under any
Letter of Credit, together with interest as hereinafter provided.
(d) Reimbursement. In the event of any drawing under any Letter of
Credit, an Issuing Lender will promptly notify the Borrower. Unless the
Borrower shall immediately notify such Issuing Lender of its intent to
otherwise reimburse such Issuing Lender, the Borrower shall be deemed to
have requested a Revolving Loan at the Adjusted Base Rate in the amount
of the drawing as provided in subsection (e) hereof, the proceeds of
which will be used to satisfy the reimbursement obligations. The Borrower
shall reimburse such Issuing Lender on the day of drawing under any
Letter of Credit either with the proceeds of a Revolving Loan obtained
hereunder or otherwise in same day funds as provided herein or in the LOC
Documents. If the Borrower shall fail to reimburse such Issuing Lender
as provided hereinabove, the unreimbursed amount of such drawing shall
bear interest at a per annum rate equal to the Base Rate plus the
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Applicable Percentage for the Base Rate Loans that are Revolving Loans
plus two percent (2%). The Borrower's reimbursement obligations
hereunder shall be absolute and unconditional under all circumstances
irrespective of (but without waiver of) any rights of set-off,
counterclaim or defense to payment the applicable account party or the
Borrower may claim or have against such Issuing Lender, the Agents, the
Lenders, the beneficiary of the Letter of Credit drawn upon or any other
Person, including without limitation, any defense based on any failure of
the applicable account party, the Borrower or any other Credit Party to
receive consideration or the legality, validity, regularity or
unenforceability of the Letter of Credit; provided, however, that the
Borrower may have a claim against an Issuing Lender, and such Issuing
Lender may be liable to the Borrower, to the extent of any actual damages
suffered by the Borrower as a result of such Issuing Lender's gross
negligence or willful misconduct in failing to pay a drawing under a
Letter of Credit presented in strict conformity therewith. The Issuing
Lenders will promptly notify the LOC Participants of the amount of any
unreimbursed drawing and each LOC Participant shall promptly pay to the
Administrative Agent for the account of the applicable Issuing Lender, in
Dollars and in immediately available funds, the amount of such LOC
Participant's Revolving Loan Commitment Percentage of such unreimbursed
drawing. Such payment shall be made on the day such notice is received
by such Lender from an Issuing Lender if such notice is received at or
before 2:00 p.m., otherwise such payment shall be made at or before 12:00
Noon on the Business Day next succeeding the day such notice is received.
If such LOC Participant does not pay such amount to an Issuing Lender in
full upon such request, such LOC Participant shall, on demand, pay to the
Administrative Agent for the account of such Issuing Lender interest on
the unpaid amount during the period from the date the LOC Participant
received the notice regarding the unreimbursed drawing until such LOC
Participant pays such amount to such Issuing Lender in full at a rate per
annum equal to, if paid within two Business Days of the date of drawing,
the Federal Funds Rate and thereafter at a rate equal to the Base Rate.
Each LOC Participant's obligation to make such payment to an Issuing
Lender, and the right of an Issuing Lender to receive the same, shall be
absolute and unconditional, shall not be affected by any circumstance
whatsoever and without regard to the termination of this Credit Agreement
or the Commitments hereunder, the existence of a Default or Event of
Default or the acceleration of the obligations hereunder and shall be
made without any offset, abatement, withholding or reduction whatsoever.
(e) Repayment with Revolving Loans. On any day on which the
Borrower shall have requested, or been deemed to have requested, a
Revolving Loan borrowing to reimburse a drawing under a Letter of Credit,
the Administrative Agent shall give notice to the applicable Lenders that
a Revolving Loan has been requested or deemed requested in connection
with a drawing under a Letter of Credit, in which case a Revolving Loan
borrowing comprised initially solely of Base Rate Loans (each such
borrowing, a "Mandatory Borrowing") shall be immediately made from all
applicable Lenders (without giving effect to any termination of the
Commitments pursuant to Section 9.2) pro rata based on each Lender's
respective Revolving Loan Commitment Percentage and the proceeds thereof
shall be paid directly to the applicable Issuing Lender for application
to the respective LOC Obligations. Each such Lender hereby irrevocably
agrees to make
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such Revolving Loans immediately upon any such request or deemed request
on account of each such Mandatory Borrowing in the amount and in the
manner specified in the preceding sentence and on the same such date
notwithstanding (i) the amount of Mandatory Borrowing may not comply with
the minimum amount for borrowings of Revolving Loans otherwise required
hereunder, (ii) whether any conditions specified in Section 5.2 are then
satisfied, (iii) whether a Default or Event of Default then exists, (iv)
failure of any such request or deemed request for Revolving Loans to be
made by the time otherwise required hereunder, (v) the date of such
Mandatory Borrowing, or (vi) any reduction in the Revolving Committed
Amount or any termination of the Commitments. In the event that any
Mandatory Borrowing cannot for any reason be made on the date otherwise
required above (including, without limitation, as a result of the
commencement of a proceeding under the Bankruptcy Code with respect to
the Borrower or any other Credit Party), then each such Lender hereby
agrees that it shall forthwith fund (as of the date the Mandatory
Borrowing would otherwise have occurred, but adjusted for any payments
received from the Borrower on or after such date and prior to such
purchase) its Participation Interest in the outstanding LOC Obligations;
provided, further, that in the event any Lender shall fail to fund its
Participation Interest on the day the Mandatory Borrowing would otherwise
have occurred, then the amount of such Lender's unfunded Participation
Interest therein shall bear interest payable to such Issuing Lender upon
demand, at the rate equal to, if paid within two Business Days of such
date, the Federal Funds Rate, and thereafter at a rate equal to the Base
Rate.
(f) Modification and Extension. The issuance of any supplement,
modification or amendment which increases the face amount of an existing
Letter of Credit or renewal, or extensions to any Letter of Credit shall,
for purposes hereof, be treated in all respects the same as the issuance
of a new Letter of Credit hereunder.
(g) Uniform Customs and Practices. The Issuing Lender may have the
Letters of Credit be subject to The Uniform Customs and Practice for
Documentary Credits, as published as of the date of issue by the
International Chamber of Commerce (Publication No. 500 or the most recent
publication, the "UCP"), in which case the UCP may be incorporated
therein and deemed in all respects to be a part thereof.
(h) Responsibility of Issuing Lenders. It is expressly understood
and agreed as between the Lenders that the obligations of the Issuing
Lenders hereunder to the LOC Participants are only those expressly set
forth in this Credit Agreement and that an Issuing Lender shall be
entitled to assume that the conditions precedent set forth in Section 5.2
have been satisfied unless it shall have acquired actual knowledge that
any such condition precedent has not been satisfied; provided, however,
that nothing set forth in this Section 2.2 shall be deemed to prejudice
the right of any LOC Participant to recover from an Issuing Lender any
amounts made available by such LOC Participant to such Issuing Lender
pursuant to this Section 2.2 in the event that it is determined by a
court of competent jurisdiction that the payment with respect to a Letter
of Credit constituted gross negligence or willful misconduct on the part
of such Issuing Lender.
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(i) Conflict with LOC Documents. In the event of any conflict
between this Credit Agreement and any LOC Document, this Credit Agreement
shall govern.
(j) Indemnification of Issuing Lenders.
(i) In addition to its other obligations under this Credit
Agreement, the Borrower hereby agrees to protect, indemnify, pay
and save the Issuing Lenders harmless from and against any and all
claims, demands, liabilities, damages, losses, costs, charges and
expenses (including reasonable attorneys' fees) that the Issuing
Lenders may incur or be subject to as a consequence, direct or
indirect, of (A) the issuance of any Letter of Credit or (B) the
failure of an Issuing Lender to honor a drawing under a Letter of
Credit as a result of any act or omission, whether rightful or
wrongful, of any present or future de jure or de facto government
or governmental authority (all such acts or omissions, herein
called "Government Acts").
(ii) As between the Borrower and an Issuing Lender, the
Borrower shall assume all risks of the acts, omissions or misuse of
any Letter of Credit by the beneficiary thereof. The Issuing
Lenders shall not be responsible for (except in the case of (A),
(B) and (C) below if an Issuing Lender has actual knowledge to the
contrary): (A) the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party
in connection with the application for and issuance of any Letter
of Credit, even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or forged;
(B) the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any Letter of Credit
or the rights or benefits thereunder or proceeds thereof, in whole
or in part, that may prove to be invalid or ineffective for any
reason; (C) failure of the beneficiary of a Letter of Credit to
comply fully with conditions required in order to draw upon a
Letter of Credit; (D) errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable,
telegraph, telex or otherwise, whether or not they be in cipher;
(E) errors in interpretation of technical terms; (F) any loss or
delay in the transmission or otherwise of any document required in
order to make a drawing under a Letter of Credit or of the proceeds
thereof; and (G) any consequences arising from causes beyond the
control of an Issuing Lender, including, without limitation, any
Government Acts. None of the above shall affect, impair, or
prevent the vesting of an Issuing Lender's rights or powers
hereunder.
(iii) In furtherance and extension and not in limitation of
the specific provisions hereinabove set forth, any action taken or
omitted by an Issuing Lender, under or in connection with any
Letter of Credit or the related certificates, if taken or omitted
in good faith, shall not put such Issuing Lender under any
resulting liability to the Borrower or any other Credit Party. It
is the intention of the parties that this Credit Agreement shall be
construed and applied to protect and indemnify the Issuing Lenders
against any and all risks involved in the
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issuance of the Letters of Credit, all of which risks are hereby
assumed by the Borrower, including, without limitation, any and all
risks of the acts or omissions, whether rightful or wrongful, of
any present or future Government Acts. An Issuing Lender shall
not, in any way, be liable for any failure by such Issuing Lender
or anyone else to pay any drawing under any Letter of Credit as a
result of any Government Acts or any other cause beyond the control
of such Issuing Lender.
(iv) Nothing in this subsection (j) is intended to limit the
reimbursement obligation of the Borrower contained in this Section
2.2. The obligations of the Borrower under this subsection (j)
shall survive the termination of this Credit Agreement. No act or
omission of any current or prior beneficiary of a Letter of Credit
shall in any way affect or impair the rights of an Issuing Lender
to enforce any right, power or benefit under this Credit Agreement.
(v) Notwithstanding anything to the contrary contained in this
subsection (j), the Borrower shall have no obligation to indemnify
an Issuing Lender in respect of any liability incurred by such
Issuing Lender arising solely out of the gross negligence or
willful misconduct of such Issuing Lender. Nothing in this Credit
Agreement shall relieve an Issuing Lender of any liability to the
Borrower in respect of any action taken by such Issuing Lender
which action constitutes gross negligence or willful misconduct of
such Issuing Lender or a violation of the UCP or Uniform Commercial
Code (as applicable), as determined by a court of competent
jurisdiction.
2.3 TRANCHE A TERM LOAN.
(a) Tranche A Term Loan Commitment. Subject to the terms and
conditions set forth herein, each Lender severally agrees to make
available to the Borrower, on the Effective Date and on the Subordinated
Notes Call Date such Lender's Tranche A Term Loan Commitment Percentage
of the Tranche A Term Loan Committed Amount for the purposes hereinafter
set forth. Subject to and upon the terms and conditions set forth herein
(including, without limitation, the terms and conditions set forth in
Section 5.2), the Tranche A Term Loans shall be made in two separate
advances. The first advance shall occur on the Effective Date and the
second advance shall occur on the Subordinated Notes Call Date. The
Borrower shall provide the Administrative Agent with written notice of
the amount of the advance needed by the Borrower on the Effective Date.
That portion of the Tranche A Term Loan Committed Amount not advanced to
the Borrower on the Effective Date shall be advanced to the Borrower on
the Subordinated Notes Call Date. Amounts repaid on the Tranche A Term
Loan may not be reborrowed.
(b) Funding of Tranche A Term Loans. Each Lender will make its
Tranche A Term Loan Commitment Percentage of each Tranche A Term Loan
advance available to the Administrative Agent by deposit, in Dollars and
in immediately available funds, at the offices of the Administrative
Agent at its principal office in Charlotte, North Carolina or
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at such other address as the Administrative Agent may designate in
writing. The amount of the Tranche A Term Loans will then be made
available to the Borrower by the Administrative Agent by crediting the
account of the Borrower on the books of such office of the Administrative
Agent, to the extent the amount of such Tranche A Term Loans are made
available to the Administrative Agent or otherwise in accordance with the
Borrower's disbursement instructions. All Tranche A Term Loans made on
the Effective Date and on the Subordinated Notes Call Date shall be Base
Rate Loans. Thereafter, all or any portion of the Tranche A Term Loans
may be converted into Eurodollar Loans in accordance with the terms of
Section 2.5.
No Lender shall be responsible for the failure or delay by any other
Lender in its obligation to make a Tranche A Term Loan hereunder;
provided, however, that the failure of any Lender to fulfill its
obligations hereunder shall not relieve any other Lender of its
obligations hereunder. If the Administrative Agent shall have received
an executed signature page to this Credit Agreement (whether an original
or via telecopy) from a Lender, the Administrative Agent may assume that
such Lender has or will make available to the Administrative Agent its
Tranche A Term Loan Commitment Percentage of each Tranche A Term Loan
advance on the Effective Date and on the Subordinated Notes Call Date,
and the Administrative Agent in reliance upon such assumption, may (in
its sole discretion but without any obligation to do so) make available
to the Borrower a corresponding amount of each Tranche A Term Loan
advance. If such corresponding amount is not in fact made available to
the Administrative Agent, the Administrative Agent shall be able to
recover such corresponding amount from such Lender. If such Lender does
not pay such corresponding amount forthwith upon the Administrative
Agent's demand therefor, the Administrative Agent will promptly notify
the Borrower, and the Borrower shall immediately pay such corresponding
amount to the Administrative Agent. The Administrative Agent shall also
be entitled to recover from the Lender or the Borrower, as the case may
be, interest on such corresponding amount in respect of each day from the
date such corresponding amount was made available by the Administrative
Agent to the Borrower to the date such corresponding amount is recovered
by the Administrative Agent at a per annum rate equal to (i) from the
Borrower at the applicable rate for such Tranche A Term Loan and (ii)
from a Lender at the Federal Funds Rate.
(c) Repayment of Tranche A Term Loans. The principal amount of the
Tranche A Term Loan shall be repaid in quarterly installments as follows,
unless accelerated sooner pursuant to Section 9.2:
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TRANCHE A TERM LOAN
PRINCIPAL AMORTIZATION PRINCIPAL AMORTIZATION
PAYMENT DATES PAYMENT
December 31, 1997 $ 3,750,000
March 31, 1998 $ 3,750,000
June 30, 1998 $ 3,750,000
September 30, 1998 $ 3,750,000
December 31, 1998 $ 5,000,000
March 31, 1999 $ 5,000,000
June 30, 1999 $ 5,000,000
September 30, 1999 $ 5,000,000
December 31, 1999 $ 6,250,000
March 31, 2000 $ 6,250,000
June 30, 2000 $ 6,250,000
September 30, 2000 $ 6,250,000
December 31, 2000 $ 6,250,000
March 31, 2001 $ 6,250,000
June 30, 2001 $ 6,250,000
September 30, 2001 $ 6,250,000
December 31, 2001 $ 7,500,000
March 31, 2002 $ 7,500,000
June 30, 2002 $ 7,500,000
September 30, 2002 $ 7,500,000
December 31, 2002 $ 8,750,000
March 31, 2003 $ 8,750,000
June 30, 2003 $ 8,750,000
September 30, 2003 $ 8,750,000
Total $150,000,000
(d) Tranche A Term Notes. The Tranche A Term Loan made by each
Lender shall be evidenced by a duly executed promissory note of the
Borrower to each applicable Lender in the face amount of its Tranche A
Term Loan Commitment Percentage of the Tranche A Term Loan Committed
Amount in substantially the form of Exhibit 2.3(d).
2.4 TRANCHE B TERM LOAN.
(a) Tranche B Term Loan Commitment. Subject to the terms and
conditions set forth herein, each Lender severally agrees to make
available to the Borrower on the Tranche B Term Loan Funding Date such
Lender's Tranche B Term Loan Commitment Percentage of the Tranche B Term
Loan Committed Amount for the purposes hereinafter set forth. Amounts
repaid on the Tranche B Term Loan may not be reborrowed.
(b) Funding of Term Loans. Each Lender will make its Tranche B Term
Loan Commitment Percentage of each Tranche B Term Loan advance available
to the Administrative Agent by deposit, in Dollars and in immediately
available funds, at the offices of the Administrative Agent at its
principal office in Charlotte, North Carolina or at such other address as
the Administrative Agent may designate in writing. The amount of the
Tranche B Term Loans will then be made available to the Borrower by the
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Administrative Agent by crediting the account of the Borrower on the
books of such office of the Administrative Agent or otherwise in
accordance with the Borrower's disbursement instructions, to the extent
the amount of such Tranche B Term Loans are made available to the
Administrative Agent. All Tranche B Term Loans made on the Effective
Date and any additional Tranche B Term Loans provided to the Borrower
after an increase in the Tranche B Term Loan Committed Amount pursuant to
the terms of Section 2.4(d) shall be Base Rate Loans on the date made.
Thereafter, all or any portion of the Tranche B Term Loans may be
converted into Eurodollar Loans in accordance with the terms of Section
2.5.
No Lender shall be responsible for the failure or delay by any other
Lender in its obligation to make a Tranche B Term Loan hereunder;
provided, however, that the failure of any Lender to fulfill its
obligations hereunder shall not relieve any other Lender of its
obligations hereunder. If the Administrative Agent shall have (x)
received an executed signature page to this Credit Agreement (whether an
original or via telecopy) from a Lender or (y) written confirmation that
a Lender plans to fund an increase in the Tranche B Term Loan Committed
Amount pursuant to Section 2.4(d), the Administrative Agent may assume
that such Lender has or will make the amount of its Tranche B Term Loans
available to the Administrative Agent on the Effective Date or on the
date of the increase, as applicable, and the Administrative Agent in
reliance upon such assumption, may (in its sole discretion but without
any obligation to do so) make available to the Borrower a corresponding
amount. If such corresponding amount is not in fact made available to
the Administrative Agent, the Administrative Agent shall be able to
recover such corresponding amount from such Lender. If such Lender does
not pay such corresponding amount forthwith upon the Administrative
Agent's demand therefor, the Administrative Agent will promptly notify
the Borrower, and the Borrower shall immediately pay such corresponding
amount to the Administrative Agent. The Administrative Agent shall also
be entitled to recover from the Lender or the Borrower, as the case may
be, interest on such corresponding amount in respect of each day from the
date such corresponding amount was made available by the Administrative
Agent to the Borrower to the date such corresponding amount is recovered
by the Administrative Agent at a per annum rate equal to (i) from the
Borrower at the applicable rate for such Tranche B Term Loan and (ii)
from a Lender at the Federal Funds Rate.
(c) Repayment of Tranche B Term Loan. The principal amount of the
Tranche B Term Loan shall be repaid in quarterly installments as follows,
unless accelerated sooner pursuant to Section 9.2:
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TRANCHE B TERM LOAN PRINCIPAL
AMORTIZATION PAYMENT (SHOWN AS A
PRINCIPAL AMORTIZATION PERCENTAGE OF THE THEN TRANCHE B
PAYMENT DATES TERM LOAN COMMITTED AMOUNT)
December 31, 1997 .250%
March 31, 1998 .250%
June 30, 1998 .250%
September 30, 1998 .250%
December 31, 1998 .250%
March 31, 1999 .250%
June 30, 1999 .250%
September 30, 1999 .250%
December 31, 1999 .250%
March 31, 2000 .250%
June 30, 2000 .250%
September 30, 2000 .250%
December 31, 2000 .250%
March 31, 2001 .250%
June 30, 2001 .250%
September 30, 2001 .250%
December 31, 2001 .250%
March 31, 2002 .250%
June 30, 2002 .250%
September 30, 2002 .250%
December 31, 2002 .250%
March 31, 2003 .250%
June 30, 2003 .250%
September 30, 2003 .250%
December 31, 2003 23.500%
March 31, 2004 23.500%
June 30, 2004 23.500%
September 30, 2004 Remaining amount of
Tranche B Term Loans
(d) Increase in Tranche B Term Loan Commitment. The Borrower shall
have the right, from time to time, to increase the Tranche B Term Loan
Committed Amount; provided that:
(i) any increase in the Tranche B Term Loan Committed Amount
must be in a minimum amount of $5,000,000 and in integral multiples
of $1,000,000 above such amount;
(ii) in no event may the Tranche B Term Loan Committed Amount
be increased to an aggregate amount greater than One Hundred Fifty
Million Dollars ($150,000,000);
(iii) as of the date of such increase in the Tranche B Term
Loan Committed Amount, after giving pro forma effect to the
Indebtedness to be incurred by such increase in the Tranche B Term
Loan Committed Amount, the
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Credit Parties shall be in compliance with all the financial
covenants set forth in Section 7.2;
(iv) any such increase in the Tranche B Term Loan Committed
Amount shall be provided, at the option of the Borrower, by (A) an
existing Lender or any existing Lenders, as applicable upon such
existing Lender's or Lenders' written consent, as applicable and/or
(B) one or more institutions that is not an existing Lender;
provided that such institution (x) is an Eligible Assignee and (y)
becomes a Lender under this Credit Agreement pursuant to the
execution and delivery of a New Commitment Agreement in
substantially the form of Exhibit 2.4(d);
(v) funds borrowed pursuant to any increase in the Tranche B
Term Loan Committed Amount are used by the Borrower to repurchase
Holding Debentures;
(vi) the Borrower shall execute new Tranche B Term Note(s) as
necessary to reflect any increase in the Tranche B Term Loan
Committed Amount;
(vii) the Borrower shall have paid all actual fees and
expenses owed to the Lenders and the Administrative Agent in
connection with any such increase in the Tranche B Term Loan
Committed Amount; and
(viii) Schedule 1.1(a) shall be revised (without any need to
obtain the consent of any of the Lenders) to reflect the change in
the Tranche B Term Loan Commitment Percentages of the Lenders as a
result of such increase in the Tranche B Term Loan Committed
Amount.
(e) Tranche B Term Notes. The Tranche B Term Loan made by each
Lender shall be evidenced by a duly executed promissory note of the
Borrower to each applicable Lender in the face amount of its Tranche B
Term Loan Commitment Percentage of the Tranche B Term Loan Committed
Amount in substantially the form of Exhibit 2.4(e).
2.5 CONTINUATIONS AND CONVERSIONS.
The Borrower shall have the option, on any Business Day, to continue
existing Eurodollar Loans for a subsequent Interest Period, to convert Base
Rate Loans into Eurodollar Loans or to convert Eurodollar Loans into Base Rate
Loans; provided, however, that (i) each such continuation or conversion must be
requested by the Borrower pursuant to a written Notice of
Continuation/Conversion, in the form of Exhibit 2.5, in compliance with the
terms set forth below, (ii) except as provided in Section 3.12, Eurodollar
Loans may only be continued or converted into Base Rate Loans on the last day
of the Interest Period applicable thereto, (iii) Eurodollar Loans may not be
continued nor may Base Rate Loans be converted into Eurodollar Loans if on the
date of such conversion or continuation a Default or an Event of Default has
occurred and is continuing and (iv) any request to continue a Eurodollar Loan
that fails to
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comply with the terms set forth below in this Section 2.5 or any failure to
request a continuation of a Eurodollar Loan at the end of an Interest Period
shall constitute a conversion to a Base Rate Loan on the last day of the
applicable Interest Period. Each continuation or conversion must be requested
by the Borrower no later than 11:00 a.m. (A) on the date for a requested
conversion of a Eurodollar Loan to a Base Rate Loan or (B) three Business Days
prior to the date for a requested continuation of a Eurodollar Loan or
conversion of a Base Rate Loan to a Eurodollar Loan, in each case pursuant to a
written Notice of Continuation/Conversion submitted to the Administrative Agent
which shall set forth (x) whether the Borrower wishes to continue or convert
such Loans and (y) if the request is to continue a Eurodollar Loan or convert a
Base Rate Loan to a Eurodollar Loan, the Interest Period applicable thereto.
2.6 MINIMUM AMOUNTS.
Each request for a borrowing, conversion or continuation shall be subject
to the requirements that (i) each Eurodollar Loan shall be in a minimum amount
of $5,000,000 and in integral multiples of $500,000 in excess thereof, (ii)
each Base Rate Loan shall be in a minimum amount of the lesser of $1,000,000
(and integral multiples of $100,000 in excess thereof) or the remaining amount
available under the Revolving Committed Amount, the Tranche A Term Loan
Committed Amount or the Tranche B Term Loan Committed Amount, as applicable,
and (iii) no more than fifteen Eurodollar Loans shall be outstanding hereunder
at any one time. For the purposes of this Section, all Eurodollar Loans with
the same Interest Periods that begin and end on the same date shall be
considered as one Eurodollar Loan, but Eurodollar Loans with different Interest
Periods, even if they begin on the same date, shall be considered as separate
Eurodollar Loans.
SECTION 3
GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT
3.1 INTEREST.
(a) Interest Rate. All Base Rate Loans shall accrue interest at the
Adjusted Base Rate and all Eurodollar Loans shall accrue interest at the
Adjusted Eurodollar Rate.
(b) Default Rate of Interest. Upon the occurrence, and during the
continuance, of an Event of Default, the principal of and, to the extent
permitted by law, interest on the Loans and any other amounts owing
hereunder or under the other Credit Documents (including without
limitation fees and expenses) shall, after written notice of same to the
Borrower, bear interest, payable on demand, at a per annum rate equal to
2% plus the rate which would otherwise be applicable (or if no rate is
applicable, then the rate for Revolving Loans that are Base Rate Loans
plus two percent (2%) per annum).
(c) Interest Payments. Interest on Loans shall be due and payable
in arrears on each Interest Payment Date. If an Interest Payment Date
falls on a date which is not a
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Business Day, such Interest Payment Date shall be deemed to be the next
succeeding Business Day, except that in the case of Eurodollar Loans
where the next succeeding Business Day falls in the next succeeding
calendar month, then on the next preceding day.
3.2 PLACE AND MANNER OF PAYMENTS.
All payments of principal, interest, fees, expenses and other amounts to
be made by a Credit Party under this Credit Agreement shall be received not
later than 2:00 p.m. on the date when due, in Dollars and in immediately
available funds, by the Administrative Agent at its offices in Charlotte, North
Carolina. Payments received after such time shall be deemed to have been
received on the next Business Day. The Borrower shall, at the time it makes
any payment under this Credit Agreement, specify to the Administrative Agent,
the Loans, Letters of Credit, fees or other amounts payable by the Borrower
hereunder to which such payment is to be applied (and in the event that it
fails to specify, or if such application would be inconsistent with the terms
hereof, the Administrative Agent shall, subject to Section 3.7, distribute such
payment to the Lenders in such manner as the Administrative Agent may deem
appropriate). The Administrative Agent will distribute such payments to the
applicable Lenders on the date received if any such payment is received prior
to 2:00 p.m.; otherwise the Administrative Agent will distribute such payment
to the applicable Lenders on the next succeeding Business Day. Whenever any
payment hereunder shall be stated to be due on a day which is not a Business
Day, the due date thereof shall be extended to the next succeeding Business Day
(subject to accrual of interest and fees for the period of such extension),
except that in the case of Eurodollar Loans, if the extension would cause the
payment to be made in the next following calendar month, then such payment
shall instead be made on the next preceding Business Day.
3.3 PREPAYMENTS.
(a) Voluntary Prepayments. Subject to the terms of Section 3.4(d),
the Borrower shall have the right to prepay Loans in whole or in part
from time to time without premium or penalty; provided, however, that (i)
Eurodollar Loans may only be prepaid on three Business Days' prior
written notice to the Administrative Agent and any prepayment of
Eurodollar Loans will be subject to Section 3.14, (ii) each such partial
prepayment of Loans shall be in the minimum principal amount of
$1,000,000 and integral multiples of $100,000 in excess thereof and (iii)
voluntary prepayments with respect to the Term Loans shall be applied pro
rata between the outstanding Tranche A Term Loans and Tranche B Term
Loans (pro rata among the remaining Principal Amortization Payments).
(b) Mandatory Prepayments.
(i) Revolving Committed Amount. If at any time the sum of the
aggregate amount of Revolving Loans outstanding plus LOC
Obligations outstanding exceeds the Revolving Committed Amount, the
Borrower shall
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immediately make a principal payment to the Administrative Agent in
the manner and in an amount necessary to be in compliance with
Section 2.1.
(ii) Excess Cash Flow. Within 10 days after the date the
audited financial statements are required to be delivered pursuant
to Section 7.1(a) for each fiscal year, commencing with the fiscal
year ending December 31, 1998, the Borrower shall make a prepayment
of the Loans in an amount equal to (a) 75% of the Excess Cash Flow
earned during the preceding fiscal year if, as of such fiscal year
end, the current Leverage Ratio is greater than or equal to 4.0 to
1.0, (b) 50% of the Excess Cash Flow earned during the preceding
fiscal year if, as of such fiscal year end, the current Leverage
Ratio is less than 4.0 to 1.0 but greater than or equal to 3.0 to
1.0 and (c) 0% of Excess Cash Flow earned during the preceding
fiscal year if, as of such fiscal year end, the current Leverage
Ratio is less than 3.0 to 1.0 (to be applied as set forth in
Section 3.3(c) below).
(iii) Asset Sales. Immediately upon receipt by a Credit Party
or any of its Subsidiaries of proceeds from any Asset Disposition,
the Borrower shall forward an amount equal to 100% of the Net Cash
Proceeds of such Asset Disposition to the Lenders as a prepayment
of the Loans (to be applied as set forth in Section 3.3(c) below).
Notwithstanding the foregoing, in the event a Foreign Subsidiary is
required to forward all or a percentage of the Net Cash Proceeds
received from a disposition of assets of such Foreign Subsidiary in
accordance with the terms of any agreement governing the
Indebtedness permitted by Section 8.1(j), the Borrower shall only
have to forward to the Lenders as a prepayment of the Loans that
portion of the Net Cash Proceeds from such Asset Disposition
remaining with such Foreign Subsidiary after making the prepayment
required by the respective agreement governing the Section 8.1(j)
Indebtedness.
(iv) Receivables Transaction. Immediately upon the receipt by
a Credit Party or any of its Subsidiaries of proceeds from a
Receivables Transaction, the Borrower shall forward an amount equal
to 100% of the Net Cash Proceeds of such Receivables Transaction to
the Lenders as a prepayment of the Loans (to be applied as set
forth in Section 3.3(c) below).
(v) Issuances of Equity. Immediately upon receipt by a
Credit Party or any of its Subsidiaries of proceeds from any Equity
Issuance (other than the issuance of shares of capital stock of
Holdings pursuant to the initial public offering of capital stock
of Holdings), the Borrower shall forward 50% of the Net Cash
Proceeds of such Equity Issuance to the Lenders as a prepayment of
the Loans (to be applied as set forth in Section 3.3(c) below).
Notwithstanding the foregoing sentence, prepayments made by the
Borrower pursuant to the terms of this Section 3.3(b)(v) shall not
exceed $50,000,000 in the aggregate.
(vi) Issuance of Debt. Immediately upon receipt by a Credit
Party or any of its Subsidiaries of proceeds from any Debt
Issuance, the Borrower shall
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forward 100% of the Net Cash Proceeds of such Debt Issuance to the
Lenders as a prepayment of the Loans (to be applied as set forth in
Section 3.3(c) below).
(c) Application of Prepayments. All amounts required to be paid
pursuant to Section 3.3(b)(i) shall be applied first to Revolving Loans
and second to a cash collateral account in respect of LOC Obligations.
All amounts required to be paid pursuant to Section 3.3(b)(ii), (iii),
(iv), (v) and (vi) above shall be applied first, pro rata between the
outstanding Tranche A Term Loans and the Tranche B Term Loans (pro rata
among the remaining Principal Amortization Payments) until the Term Loans
have been paid in full, second, to the Revolving Loans (with a
corresponding reduction in the Revolving Committed Amount) until the
Revolving Committed Amount shall be reduced to zero and third, to a cash
collateral account in respect of LOC Obligations. One or more holders of
the Tranche B Term Loans may decline to accept a mandatory prepayment
under Sections 3.3(b)(ii), (iii), (iv), (v) or (vi) (to the extent there
are sufficient Tranche A Term Loans outstanding to be paid with such
prepayment) in which case such declined prepayments shall be allocated
pro rata among the Tranche A Term Loans and Tranche B Term Loans held by
Lenders accepting such prepayments. Within the parameters of the
applications set forth above, prepayments shall be applied first to Base
Rate Loans and then to Eurodollar Loans in direct order of Interest
Period maturities. All prepayments hereunder shall be subject to Section
3.14.
3.4 FEES.
(a) Commitment Fees. In consideration of the Revolving Committed
Amount and Tranche A Term Loan Committed Amount being made available by
the Lenders hereunder, the Borrower agrees to pay to the Administrative
Agent, for the pro rata benefit of each applicable Lender (based on each
Lender's Revolving Loan Commitment Percentage of the Revolving Committed
Amount and Tranche A Term Loan Commitment Percentage of the Tranche A
Term Loan Committed Amount, as applicable), a fee equal to the Applicable
Percentage for Commitment Fees multiplied by the applicable Unused
Commitment (the "Commitment Fees"). The Commitment Fees accrued prior to
the Closing Date shall be paid on the Effective Date and future
Commitment Fees shall commence to accrue on the Effective Date to and
excluding the earlier of the Revolving Loan Maturity Date or the date on
which the Revolving Committed Amount is terminated and shall be due and
payable in arrears on the last day of each fiscal quarter of the Borrower
(as well as on the Revolving Loan Maturity Date, Tranche A Term Loan
Maturity Date and on any date that the Revolving Committed Amount is
reduced) for the immediately preceding fiscal quarter (or portion
thereof), beginning with the first of such dates to occur after the
Closing Date.
(b) Letter of Credit Fees.
(i) Letter of Credit Fees. In consideration of the issuance
of Letters of Credit hereunder, the Borrower agrees to pay to the
applicable Issuing Lender for the pro rata benefit of the
applicable Lenders (based on each Lender's Revolving
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Loan Commitment Percentage of the Revolving Committed Amount), a
fee (the "Letter of Credit Fees") equal to the Applicable
Percentage for the Letter of Credit Fees on the average daily
maximum amount available to be drawn under each such Letter of
Credit from the date of issuance to the date of expiration. The
Letter of Credit Fees will be payable in arrears on the last day of
each fiscal quarter of the Borrower (as well as on the Revolving
Loan Maturity Date) for the immediately preceding fiscal quarter
(or portion thereof), beginning with the first of such dates to
occur after the Closing Date.
(ii) Issuing Lender Fees. In addition to the Letter of Credit
Fees payable pursuant to subsection (i) above, the Borrower shall
pay to the applicable Issuing Lender for its own account, without
sharing by the other Lenders, (A) a fee equal to one-eighth of one
percent (1/8%) per annum on the total sum of the undrawn amounts of
all Letters of Credit issued by the Issuing Lenders, such fee to be
paid in arrears 15 days after the last day of each fiscal quarter
of the Borrower (as well as on the Revolving Loan Maturity Date)
and (B) the customary charges from time to time to the Issuing
Lenders for their services in connection with the issuance,
amendment, payment, transfer, administration, cancellation and
conversion of, and drawings under, such Letters of Credit
(collectively, the "Issuing Lender Fees").
(c) Administrative Fees. The Borrower agrees to pay to the
Administrative Agent, for its own account, an annual fee in accordance
with the terms of the Fee Letters.
(d) Prepayment Premium. In the event the Tranche B Term Loan is
voluntarily prepaid in full prior to the date one year from the Effective
Date, the Borrower agrees to pay a pro rata prepayment penalty to the
Lenders that have made Tranche B Term Loan advances to the Borrower in an
amount equal to one and one-half percent (1.5%) of the Tranche B Term
Loan Committed Amount.
3.5 PAYMENT IN FULL AT MATURITY.
(a) On the Revolving Loan Maturity Date, the entire outstanding
principal balance of all Revolving Loans and all LOC Obligations,
together with accrued but unpaid interest and all other sums owing with
respect thereto, shall be due and payable in full, unless accelerated
sooner pursuant to Section 9.2.
(b) On the Tranche A Term Loan Maturity Date, the entire outstanding
principal balance of all Tranche A Term Loans, together with accrued but
unpaid interest and all other sums owing with respect thereto, shall be
due and payable in full, unless accelerated sooner pursuant to Section
9.2.
(c) On the Tranche B Term Loan Maturity Date, the entire outstanding
principal balance of all Tranche B Term Loans, together with accrued but
unpaid interest
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and all other sums owing with respect thereto, shall be due and payable
in full, unless accelerated sooner pursuant to Section 9.2.
3.6 COMPUTATIONS OF INTEREST AND FEES.
(a) Except for Base Rate Loans, in which case interest shall be
computed on the basis of a 365 or 366 day year as the case may be, all
computations of interest and fees hereunder shall be made on the basis of
the actual number of days elapsed over a year of 360 days. Interest
shall accrue from and include the date of borrowing (or continuation or
conversion) but exclude the date of payment.
(b) It is the intent of the Lenders and the Credit Parties to
conform to and contract in strict compliance with applicable usury law
from time to time in effect. All agreements between the Lenders and the
Borrower are hereby limited by the provisions of this paragraph which
shall override and control all such agreements, whether now existing or
hereafter arising and whether written or oral. In no way, nor in any
event or contingency (including but not limited to prepayment or
acceleration of the maturity of any obligation), shall the interest
taken, reserved, contracted for, charged, or received under this Credit
Agreement, under the Notes or otherwise, exceed the maximum nonusurious
amount permissible under applicable law. If, from any possible
construction of any of the Credit Documents or any other document,
interest would otherwise be payable in excess of the maximum nonusurious
amount, any such construction shall be subject to the provisions of this
paragraph and such documents shall be automatically reduced to the
maximum nonusurious amount permitted under applicable law, without the
necessity of execution of any amendment or new document. If any Lender
shall ever receive anything of value which is characterized as interest
on the Loans under applicable law and which would, apart from this
provision, be in excess of the maximum lawful amount, an amount equal to
the amount which would have been excessive interest shall, without
penalty, be applied to the reduction of the principal amount owing on the
Loans and not to the payment of interest, or refunded to the Borrower or
the other payor thereof if and to the extent such amount which would have
been excessive exceeds such unpaid principal amount of the Loans. The
right to demand payment of the Loans or any other indebtedness evidenced
by any of the Credit Documents does not include the right to receive any
interest which has not otherwise accrued on the date of such demand, and
the Lenders do not intend to charge or receive any unearned interest in
the event of such demand. All interest paid or agreed to be paid to the
Lenders with respect to the Loans shall, to the extent permitted by
applicable law, be amortized, prorated, allocated, and spread throughout
the full stated term (including any renewal or extension) of the Loans so
that the amount of interest on account of such indebtedness does not
exceed the maximum nonusurious amount permitted by applicable law.
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3.7 PRO RATA TREATMENT.
Except to the extent otherwise provided herein:
(a) Loans. Each Revolving Loan borrowing (including, without
limitation, each Mandatory Borrowing), each payment or prepayment of
principal of any Loan, each payment of fees (other than the Issuing
Lender Fees retained by each Issuing Lender for its own account and the
Administrative Fees retained by the Administrative Agent for its own
account), each reduction of the Revolving Committed Amount, and each
conversion or continuation of any Loan, shall (except as otherwise
provided in Section 3.11) be allocated pro rata among the relevant
Lenders in accordance with the respective Revolving Loan Commitment
Percentages, Tranche A Term Loan Commitment Percentages and Tranche B
Term Loan Commitment Percentages, as applicable, of such Lenders (or, if
the Commitments of such Lenders have expired or been terminated, in
accordance with the respective principal amounts of the outstanding Loans
and Participation Interests of such Lenders); provided that, if any
Lender shall have failed to pay its applicable pro rata share of any
Revolving Loan, any Tranche A Term Loan or any Tranche B Term Loan, then
any amount to which such Lender would otherwise be entitled pursuant to
this subsection (a) shall instead be payable to the Administrative Agent
until the share of such Loan not funded by such Lender has been repaid;
provided further, that in the event any amount paid to any Lender
pursuant to this subsection (a) is rescinded or must otherwise be
returned by the Administrative Agent, each Lender shall, upon the request
of the Administrative Agent, repay to the Administrative Agent the amount
so paid to such Lender, with interest for the period commencing on the
date such payment is returned by the Administrative Agent until the date
the Administrative Agent receives such repayment at a rate per annum
equal to, during the period to but excluding the date two Business Days
after such request, the Federal Funds Rate, and thereafter, the Base Rate
plus two percent (2%) per annum; and
(b) Letters of Credit. Each payment of unreimbursed drawings in
respect of LOC Obligations shall be allocated to each LOC Participant pro
rata in accordance with its Revolving Loan Commitment Percentage;
provided that, if any LOC Participant shall have failed to pay its
applicable pro rata share of any drawing under any Letter of Credit, then
any amount to which such LOC Participant would otherwise be entitled
pursuant to this subsection (b) shall instead be payable to the
applicable Issuing Lender until the share of such unreimbursed drawing
not funded by such Lender has been repaid; provided further, that in the
event any amount paid to any LOC Participant pursuant to this subsection
(b) is rescinded or must otherwise be returned by an Issuing Lender, each
LOC Participant shall, upon the request of such Issuing Lender, repay to
the Administrative Agent for the account of such Issuing Lender the
amount so paid to such LOC Participant, with interest for the period
commencing on the date such payment is returned by such Issuing Lender
until the date such Issuing Lender receives such repayment at a rate per
annum equal to, during the period to but excluding the date two Business
Days after such request, the Federal Funds Rate, and thereafter, the Base
Rate plus two percent (2%) per annum.
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3.8 SHARING OF PAYMENTS.
The Lenders agree among themselves that, except to the extent otherwise
provided herein, in the event that any Lender shall obtain payment in respect
of any Loan, unreimbursed drawing with respect to any LOC Obligations or any
other obligation owing to such Lender under this Credit Agreement through the
exercise of a right of setoff, banker's lien or counterclaim, or pursuant to a
secured claim under Section 506 of the Bankruptcy Code or other security or
interest arising from, or in lieu of, such secured claim, received by such
Lender under any applicable bankruptcy, insolvency or other similar law or
otherwise, or by any other means, in excess of its pro rata share of such
payment as provided for in this Credit Agreement, such Lender shall promptly
pay in cash or purchase from the other Lenders a participation in such Loans,
LOC Obligations, and other obligations in such amounts, and make such other
adjustments from time to time, as shall be equitable to the end that all
Lenders share such payment in accordance with their respective ratable shares
as provided for in this Credit Agreement. The Lenders further agree among
themselves that if payment to a Lender obtained by such Lender through the
exercise of a right of setoff, banker's lien, counterclaim or other event as
aforesaid shall be rescinded or must otherwise be restored, each Lender which
shall have shared the benefit of such payment shall, by payment in cash or a
repurchase of a participation theretofore sold, return its share of that
benefit (together with its share of any accrued interest payable with respect
thereto) to each Lender whose payment shall have been rescinded or otherwise
restored. The Borrower agrees that any Lender so purchasing such a
participation may, to the fullest extent permitted by law, exercise all rights
of payment, including setoff, banker's lien or counterclaim, with respect to
such participation as fully as if such Lender were a holder of such Loan, LOC
Obligation or other obligation in the amount of such participation. Except as
otherwise expressly provided in this Credit Agreement, if any Lender or an
Agent shall fail to remit to an Agent or any other Lender an amount payable by
such Lender or such Agent to such Agent or such other Lender pursuant to this
Credit Agreement on the date when such amount is due, such payments shall be
made together with interest thereon for each date from the date such amount is
due until the date such amount is paid to such Agent or such other Lender at a
rate per annum equal to the Federal Funds Rate. If under any applicable
bankruptcy, insolvency or other similar law, any Lender receives a secured
claim in lieu of a setoff to which this Section 3.8 applies, such Lender shall,
to the extent practicable, exercise its rights in respect of such secured claim
in a manner consistent with the rights of the Lenders under this Section 3.8 to
share in the benefits of any recovery on such secured claim.
3.9 CAPITAL ADEQUACY.
If, after the date hereof, any Lender has determined that the adoption or
the becoming effective of, or any change in, or any change by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof in the interpretation or administration of, any
applicable law, rule or regulation regarding capital adequacy, or compliance by
such Lender, or its parent corporation, with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such
authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on such Lender's
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(or parent corporation's) capital or assets as a consequence of its commitments
or obligations hereunder to a level below that which such Lender, or its parent
corporation, could have achieved but for such adoption, effectiveness, change
or compliance (taking into consideration such Lender's (or parent
corporation's) policies with respect to capital adequacy), then, upon notice
from such Lender to the Borrower, the Borrower shall be obligated to pay to
such Lender such additional amount or amounts as will compensate such Lender
for such reduction. Each determination by any such Lender of amounts owing
under this Section shall, absent manifest error, be conclusive and binding on
the parties hereto. This covenant shall survive the termination of this Credit
Agreement and the payment of the Loans and all other amounts payable hereunder.
3.10 INABILITY TO DETERMINE INTEREST RATE.
If prior to the first day of any Interest Period, the Administrative Agent
shall have determined in good faith (which determination shall be conclusive
and binding upon the Borrower) that, by reason of circumstances affecting the
relevant market, adequate and reasonable means do not exist for ascertaining
the Eurodollar Rate for such Interest Period, the Administrative Agent shall
give telecopy or telephonic notice thereof to the Borrower and the Lenders as
soon as practicable thereafter, and will also give prompt written notice to the
Borrower when such conditions no longer exist. If such notice is given (a) any
Eurodollar Loans requested to be made on the first day of such Interest Period
shall be made as Base Rate Loans, (b) any Loans that were to have been
converted on the first day of such Interest Period to or continued as
Eurodollar Loans shall be converted to or continued as Base Rate Loans and (c)
any outstanding Eurodollar Loans shall be converted, on the first day of such
Interest Period, to Base Rate Loans. Until such notice has been withdrawn by
the Administrative Agent, no further Eurodollar Loans shall be made or
continued as such, nor shall the Borrower have the right to convert Base Rate
Loans to Eurodollar Loans.
3.11 ILLEGALITY.
Notwithstanding any other provision herein, if the adoption of or any
change in any Requirement of Law or in the interpretation or application
thereof occurring after the Closing Date shall make it unlawful for any Lender
to make or maintain Eurodollar Loans as contemplated by this Credit Agreement,
(a) such Lender shall promptly give written notice of such circumstances to the
Borrower and the Administrative Agent (which notice shall be withdrawn whenever
such circumstances no longer exist), (b) the commitment of such Lender
hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert a Base Rate Loan to Eurodollar Loans shall forthwith be canceled and,
until such time as it shall no longer be unlawful for such Lender to make or
maintain Eurodollar Loans, such Lender shall then have a commitment only to
make a Base Rate Loan when a Eurodollar Loan is requested and (c) such Lender's
Loans then outstanding as Eurodollar Loans, if any, shall be converted
automatically to Base Rate Loans on the respective last days or the then
current Interest Periods with respect to such Loans or within such earlier
period as required by law. If any such conversion of a Eurodollar Loan occurs
on a day which is not the last day of the then current Interest Period with
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respect thereto, the Borrower shall pay to such Lender such amounts, if any, as
may be required pursuant to Section 3.14.
3.12 REQUIREMENTS OF LAW.
If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof applicable to any Lender, or compliance
by any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority, in each case made
subsequent to the Closing Date (or, if later, the date on which such Lender
becomes a Lender):
(a) shall subject such Lender to any tax of any kind whatsoever with
respect to any Letter of Credit, any Eurodollar Loans made by it or its
obligation to make Eurodollar Loans, or change the basis of taxation of
payments to such Lender in respect thereof (except for Non-Excluded Taxes
covered by Section 3.13 (including Non-Excluded Taxes imposed solely by
reason of any failure of such Lender to comply with its obligations under
Section 3.13(b)) and changes in taxes measured by or imposed upon the
overall net income, or franchise tax (imposed in lieu of such net income
tax), of such Lender or its applicable lending office, branch, or any
affiliate thereof);
(b) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans
or other extensions of credit by, or any other acquisition of funds by,
any office of such Lender which is not otherwise included in the
determination of the Eurodollar Rate hereunder; or
(c) shall impose on such Lender any other condition (excluding any
tax of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting
into, continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, upon notice to the Borrower from such Lender,
through the Administrative Agent, in accordance herewith, the Borrower shall be
obligated to promptly pay such Lender, upon its demand, any additional amounts
necessary to compensate such Lender for such increased cost or reduced amount
receivable, provided that, in any such case, the Borrower may elect to convert
the Eurodollar Loans made by such Lender hereunder to Base Rate Loans by giving
the Administrative Agent at least one Business Day's notice of such election,
in which case the Borrower shall promptly pay to such Lender, upon demand,
without duplication, such amounts, if any, as may be required pursuant to
Section 3.14. If any Lender becomes entitled to claim any additional amounts
pursuant to this Section 3.12, it shall provide prompt notice thereof to the
Borrower, through the Administrative Agent, certifying (x) that one of the
events described in this Section 3.12 has occurred and describing in reasonable
detail the nature of such event, (y) as to the increased cost or reduced amount
resulting from such event and (z) as to the additional amount demanded by such
Lender and a
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reasonably detailed explanation of the calculation thereof. Such a certificate
as to any additional amounts payable pursuant to this Section 3.12 submitted by
such Lender, through the Administrative Agent, to the Borrower shall be
conclusive and binding on the parties hereto in the absence of manifest error.
This covenant shall survive the termination of this Credit Agreement and the
payment of the Loans and all other amounts payable hereunder.
3.13 TAXES.
(a) Except as provided below in this Section 3.13, all payments made
by the Borrower under this Credit Agreement and any Notes shall be made
free and clear of, and without deduction or withholding for or on account
of, any present or future income, stamp or other taxes, levies, imposts,
duties, charges, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any court, or
governmental body, agency or other official, excluding taxes measured by
or imposed upon the overall net income of the Administrative Agent or any
Lender or its applicable lending office, or any branch or affiliate
thereof, and all franchise taxes, branch taxes, taxes on doing business
or taxes on the overall capital or net worth of any Lender or its
applicable lending office, or any branch or affiliate thereof, in each
case imposed in lieu of net income taxes: (i) by the jurisdiction under
the laws of which such Lender, applicable lending office, branch or
affiliate is organized or is located, or in which its principal executive
office is located, or any nation within which such jurisdiction is
located or any political subdivision thereof; or (ii) by reason of any
connection between the jurisdiction imposing such tax and such Lender,
applicable lending office, branch or affiliate other than a connection
arising solely from such Lender having executed, delivered or performed
its obligations, or received payment under or enforced, this Credit
Agreement or any Notes. If any such non-excluded taxes, levies, imposts,
duties, charges, fees, deductions or withholdings ("Non-Excluded Taxes")
are required to be withheld from any amounts payable to the
Administrative Agent or any Lender hereunder or under any Notes, (A) the
amounts so payable to the Administrative Agent or such Lender shall be
increased to the extent necessary to yield to the Administrative Agent or
such Lender (after payment of all Non-Excluded Taxes) interest or any
such other amounts payable hereunder at the rates or in the amounts
specified in this Credit Agreement and any Notes, provided, however, that
the Borrower shall be entitled to deduct and withhold any Non-Excluded
Taxes and shall not be required to increase any such amounts payable to
any Lender that is not organized under the laws of the United States of
America or a state thereof if such Lender fails to comply with the
requirements of paragraph (b) of this Section 3.13 whenever any
Non-Excluded Taxes are payable by the Borrower, and (B) as promptly as
possible after requested the Borrower shall send to the Administrative
Agent for its own account or for the account of such Lender, as the case
may be, a certified copy of an original official receipt received by the
Borrower showing payment thereof. If the Borrower fails to pay any
Non-Excluded Taxes when due to the appropriate taxing authority or fails
to remit to the Administrative Agent the required receipts or other
required documentary evidence, the Borrower shall indemnify the
Administrative Agent and any Lender for any incremental taxes, interest
or penalties that may become payable by the Administrative Agent or any
Lender as a result of any
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such failure. The agreements in this subsection shall survive the
termination of this Credit Agreement and the payment of the Loans and all
other amounts payable hereunder.
(b) Each Lender that is not incorporated under the laws of the
United States of America or a state thereof shall:
(i) (A) on or before the date of any payment by the
Borrower under this Credit Agreement or Notes to such
Lender, deliver to the Borrower and the Administrative
Agent (x) two duly completed copies of United States
Internal Revenue Service Form 1001 or 4224, or successor
applicable form, as the case may be, certifying that it is
entitled to receive payments under this Credit Agreement
and any Notes without deduction or withholding of any
United States federal income taxes and (y) an Internal
Revenue Service Form W-8 or W-9, or successor applicable
form, as the case may be, certifying that it is entitled
to an exemption from United States backup withholding tax;
(B) deliver to the Borrower and the Administrative
Agent two further copies of any such form or certification
on or before the date that any such form or certification
expires or becomes obsolete and after the occurrence of
any event requiring a change in the most recent form
previously delivered by it to the Borrower; and
(C) obtain such extensions of time for filing and
complete such forms or certifications as may reasonably be
requested by the Borrower or the Administrative Agent; or
(ii) in the case of any such Lender that is not a "bank"
within the meaning of Section 881(c)(3)(A) of the Code, (A)
represent to the Borrower (for the benefit of the Borrower and the
Administrative Agent) that it is not a bank within the meaning of
Section 881(c)(3)(A) of the Code, (B) agree to furnish to the
Borrower, on or before the date of any payment by the Borrower,
with a copy to the Administrative Agent, two accurate and complete
original signed copies of Internal Revenue Service Form W-8, or
successor applicable form certifying to such Lender's legal
entitlement at the date of such certificate to an exemption from
U.S. withholding tax under the provisions of Section 881(c) of the
Code with respect to payments to be made under this Credit
Agreement and any Notes (and to deliver to the Borrower and the
Administrative Agent two further copies of such form on or before
the date it expires or becomes obsolete and after the occurrence of
any event requiring a change in the most recently provided form
and, if necessary, obtain any extensions of time reasonably
requested by the Borrower or the Administrative Agent for filing
and completing such forms), and (C) agree, to the extent legally
entitled to do so, upon reasonable request by the Borrower, to
provide to the Borrower (for the benefit of the Borrower and the
Administrative Agent) such other forms as may be reasonably
required in order to
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establish the legal entitlement of such Lender to an exemption from
withholding with respect to payments under this Credit Agreement
and any Notes.
Notwithstanding the above, if any change in treaty, law or regulation has
occurred after the date such Person becomes a Lender hereunder which
renders all such forms inapplicable or which would prevent such Lender
from duly completing and delivering any such form with respect to it and
such Lender so advises the Borrower and the Administrative Agent then
such Lender shall be exempt from such requirements. Each Person that
shall become a Lender or a participant of a Lender pursuant to Section
11.3 shall, upon the effectiveness of the related transfer, be required
to provide all of the forms, certifications and statements required
pursuant to this subsection (b); provided that in the case of a
participant of a Lender, the obligations of such participant of a Lender
pursuant to this subsection (b) shall be determined as if the participant
of a Lender were a Lender except that such participant of a Lender shall
furnish all such required forms, certifications and statements to the
Lender from which the related participation shall have been purchased.
3.14 COMPENSATION.
The Borrower promises to indemnify each Lender and to hold each Lender
harmless from any loss or expense which such Lender may sustain or incur as a
consequence of (a) default by the Borrower in making a borrowing of, conversion
into or continuation of Eurodollar Loans after the Borrower has given a notice
requesting the same in accordance with the provisions of this Credit Agreement,
(b) default by the Borrower in making any prepayment of a Eurodollar Loan after
the Borrower has given a notice thereof in accordance with the provisions of
this Credit Agreement or (c) the making of a prepayment of Eurodollar Loans on
a day which is not the last day of an Interest Period with respect thereto.
With respect to Eurodollar Loans, such indemnification shall be an amount equal
to (i) the amount of interest which would have accrued on the amount so
prepaid, or not so borrowed, converted or continued, for the period from the
date of such prepayment or of such failure to borrow, convert or continue to
the last day of the applicable Interest Period (or, in the case of a failure to
borrow, convert or continue, the Interest Period that would have commenced on
the date of such failure) in each case at the applicable rate of interest for
such Eurodollar Loans provided for herein (excluding, however, the Applicable
Percentage included therein, if any) minus (ii) the amount of interest (as
reasonably determined by such Lender) which would have accrued to such Lender
on such amount by placing such amount on deposit for a comparable period with
leading banks in the interbank Eurodollar market. The agreements in this
Section shall survive the termination of this Credit Agreement and the payment
of the Loans and all other amounts payable hereunder.
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SECTION 4
GUARANTY
4.1 GUARANTY OF PAYMENT.
Subject to Section 4.7 below, each of the Guarantors hereby, jointly and
severally, unconditionally guarantees to each Lender, each Affiliate of Lender
that enters into a Hedging Agreement and the Agents the prompt payment of the
Credit Party Obligations in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration or otherwise). The Guarantors
additionally, jointly and severally, unconditionally guarantee to each Lender,
each Affiliate of a Lender that enters into a Hedging Agreement and the Agents
the timely performance of all other obligations under the Credit Documents and
such Hedging Agreements. This Guaranty is a guaranty of payment and not of
collection and is a continuing guaranty and shall apply to all Credit Party
Obligations whenever arising.
4.2 OBLIGATIONS UNCONDITIONAL.
The obligations of the Guarantors hereunder are absolute and
unconditional, irrespective of the value, genuineness, validity, regularity or
enforceability of any of the Credit Documents or the Hedging Agreements, or any
other agreement or instrument referred to therein, to the fullest extent
permitted by applicable law, irrespective of any other circumstance whatsoever
which might otherwise constitute a legal or equitable discharge or defense of a
surety or guarantor. Each Guarantor agrees that this Guaranty may be enforced
by the Lenders without the necessity at any time of resorting to or exhausting
any other security or collateral and without the necessity at any time of
having recourse to the Notes or any other of the Credit Documents or any
collateral, if any, hereafter securing the Credit Party Obligations or
otherwise and each Guarantor hereby waives the right to require the Lenders to
proceed against the Borrower or any other Person (including a co-guarantor) or
to require the Lenders to pursue any other remedy or enforce any other right.
Each Guarantor further agrees that it shall have no right of subrogation,
indemnity, reimbursement or contribution against the Borrower or any other
Guarantor of the Credit Party Obligations for amounts paid under this Guaranty
until such time as the Lenders (and any Affiliates of Lenders entering into
Hedging Agreements) have been paid in full, all Commitments under the Credit
Agreement have been terminated and no Person or Governmental Authority shall
have any right to request any return or reimbursement of funds from the Lenders
in connection with monies received under the Credit Documents. Each Guarantor
further agrees that nothing contained herein shall prevent the Lenders from
suing on the Notes or any of the other Credit Documents or any of the Hedging
Agreements or foreclosing its security interest in or Lien on any collateral,
if any, securing the Credit Party Obligations or from exercising any other
rights available to it under this Credit Agreement, the Notes, any other of the
Credit Documents, or any other instrument of security, if any, and the exercise
of any of the aforesaid rights and the completion of any foreclosure
proceedings shall not constitute a discharge of any of any Guarantor's
obligations hereunder; it being the purpose and intent of each Guarantor that
its obligations hereunder shall be absolute, independent and unconditional
under any and all circumstances. Neither any Guarantor's obligations under
this Guaranty nor any remedy for the
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enforcement thereof shall be impaired, modified, changed or released in any
manner whatsoever by an impairment, modification, change, release or limitation
of the liability of the Borrower or by reason of the bankruptcy or insolvency
of the Borrower. Each Guarantor waives any and all notice of the creation,
renewal, extension or accrual of any of the Credit Party Obligations and notice
of or proof of reliance of by any Agent or any Lender upon this Guarantee or
acceptance of this Guarantee. The Credit Party Obligations, and any of them,
shall conclusively be deemed to have been created, contracted or incurred, or
renewed, extended, amended or waived, in reliance upon this Guarantee. All
dealings between the Borrower and any of the Guarantors, on the one hand, and
the Agents and the Lenders, on the other hand, likewise shall be conclusively
presumed to have been had or consummated in reliance upon this Guarantee.
4.3 MODIFICATIONS.
Each Guarantor agrees that (a) all or any part of the security now or
hereafter held for the Credit Party Obligations, if any, may be exchanged,
compromised or surrendered from time to time; (b) the Lenders shall not have
any obligation to protect, perfect, secure or insure any such security
interests, liens or encumbrances now or hereafter held, if any, for the Credit
Party Obligations or the properties subject thereto; (c) the time or place of
payment of the Credit Party Obligations may be changed or extended, in whole or
in part, to a time certain or otherwise, and may be renewed or accelerated, in
whole or in part; (d) the Borrower and any other party liable for payment under
the Credit Documents may be granted indulgences generally; (e) any of the
provisions of the Notes or any of the other Credit Documents may be modified,
amended or waived; (f) any party (including any co-guarantor) liable for the
payment thereof may be granted indulgences or be released; and (g) any deposit
balance for the credit of the Borrower or any other party liable for the
payment of the Credit Party Obligations or liable upon any security therefor
may be released, in whole or in part, at, before or after the stated, extended
or accelerated maturity of the Credit Party Obligations, all without notice to
or further assent by such Guarantor, which shall remain bound thereon,
notwithstanding any such exchange, compromise, surrender, extension, renewal,
acceleration, modification, indulgence or release.
4.4 WAIVER OF RIGHTS.
Each Guarantor expressly waives: (a) notice of acceptance of this
Guaranty by the Lenders and of all extensions of credit to the Borrower by the
Lenders; (b) presentment and demand for payment or performance of any of the
Credit Party Obligations; (c) protest and notice of dishonor or of default
(except as specifically required in the Credit Agreement) with respect to the
Credit Party Obligations or with respect to any security therefor; (d) notice
of the Lenders obtaining, amending, substituting for, releasing, waiving or
modifying any security interest, lien or encumbrance, if any, hereafter
securing the Credit Party Obligations, or the Lenders' subordinating,
compromising, discharging or releasing such security interests, liens or
encumbrances, if any; (e) all other notices to which such Guarantor might
otherwise be entitled; and (f) demand for payment under this Guaranty.
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4.5 REINSTATEMENT.
The obligations of the Guarantors under this Section 4 shall be
automatically reinstated if and to the extent that for any reason any payment
by or on behalf of any Person in respect of the Credit Party Obligations is
rescinded or must be otherwise restored by any holder of any of the Credit
Party Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it will indemnify
the Agents and each Lender on demand for all reasonable costs and expenses
(including, without limitation, reasonable fees of counsel) incurred by an
Agent or such Lender in connection with such rescission or restoration,
including any such costs and expenses incurred in defending against any claim
alleging that such payment constituted a preference, fraudulent transfer or
similar payment under any bankruptcy, insolvency or similar law.
4.6 REMEDIES.
The Guarantors agree that, as between the Guarantors, on the one hand, and
the Agents and the Lenders, on the other hand, the Credit Party Obligations may
be declared to be forthwith due and payable as provided in Section 9 (and shall
be deemed to have become automatically due and payable in the circumstances
provided in Section 9) notwithstanding any stay, injunction or other
prohibition preventing such declaration (or preventing such Credit Party
Obligations from becoming automatically due and payable) as against any other
Person and that, in the event of such declaration (or such Credit Party
Obligations being deemed to have become automatically due and payable), such
Credit Party Obligations (whether or not due and payable by any other Person)
shall forthwith become due and payable by the Guarantors. The Guarantors
acknowledge and agree that their obligations hereunder are secured in
accordance with the terms of the Security Agreements and the other Collateral
Documents and that the Lenders may exercise their remedies thereunder in
accordance with the terms thereof.
4.7 LIMITATION OF GUARANTY.
Notwithstanding any provision to the contrary contained herein or in any
of the other Credit Documents, (a) to the extent the obligations of any
Guarantor shall be adjudicated to be invalid or unenforceable for any reason
(including, without limitation, because of any applicable state or federal law
relating to fraudulent conveyances or transfers) then the obligations of such
Guarantor hereunder shall be limited to the maximum amount that is permissible
under applicable law (whether federal or state and including, without
limitation, the Bankruptcy Code) and (b) the obligations of Holdings hereunder
and under the Credit Documents, in the aggregate, shall be limited to an amount
equal to [$ ___], unless all the Holdings Debentures have been repurchased, in
which case no such limitation shall apply.
4.8 RIGHTS OF CONTRIBUTION.
The Credit Parties agree among themselves that, in connection with
payments made hereunder, each Credit Party shall have contribution rights
against the other Credit Parties as permitted under applicable law. Such
contribution rights shall be subordinate and subject in right
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of payment to the obligations of the Credit Parties under the Credit Documents
and no Credit Party shall exercise such rights of contribution until all Credit
Party Obligations have been paid in full and the Commitments terminated.
SECTION 5
CONDITIONS PRECEDENT
5.1 CLOSING CONDITIONS.
The obligation of the Lenders to enter into this Credit Agreement and make
the initial Extension of Credit is subject to satisfaction of the following
conditions:
(a) Executed Credit Documents. Receipt by the Administrative Agent
of duly executed copies of: (i) this Credit Agreement; (ii) the Notes;
(iii) the Collateral Documents; and (iv) all other Credit Documents, each
in form and substance reasonably acceptable to the Administrative Agent
in its sole discretion.
(b) Corporate Documents. Receipt by the Administrative Agent of the
following:
(i) Charter Documents. Copies of the articles or certificates
of incorporation or other charter documents of each Credit Party
certified to be true and complete as of a recent date by the
appropriate Governmental Authority of the state or other
jurisdiction of its incorporation and certified by a secretary or
assistant secretary of such Credit Party to be true and correct as
of the Effective Date.
(ii) Bylaws. A copy of the bylaws of each Credit Party
certified by a secretary or assistant secretary of such Credit
Party to be true and correct as of the Effective Date.
(iii) Resolutions. Copies of resolutions of the Board of
Directors of each Credit Party approving and adopting the Credit
Documents to which it is a party, the transactions contemplated
therein and authorizing execution and delivery thereof, certified
by a secretary or assistant secretary of such Credit Party to be
true and correct and in full force and effect as of the Effective
Date.
(iv) Good Standing. Copies of (A) certificates of good
standing, existence or its equivalent with respect to each Credit
Party certified as of a recent date by the appropriate Governmental
Authorities of the state or other jurisdiction of incorporation and
each other jurisdiction in which the failure to so qualify and be
in good standing would have a Material Adverse Effect on the
business or operations of a Credit Party in such jurisdiction and
(B) to the extent available, a
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certificate indicating payment of all corporate franchise taxes
certified as of a recent date by the appropriate governmental
taxing authorities.
(v) Incumbency. An incumbency certificate of each Credit
Party certified by a secretary or assistant secretary to be true
and correct as of the Effective Date.
(c) Opinion of Counsel. Receipt by the Administrative Agent of an
opinion, or opinions (which shall cover, among other things, authority,
legality, validity, binding effect, enforceability and attachment and
perfection of liens), reasonably satisfactory to the Administrative
Agent, addressed to the Administrative Agent on behalf of the Lenders and
dated as of the Effective Date, from legal counsel to the Credit Parties.
(d) Personal Property Collateral. The Collateral Agent shall have
received, in form and substance reasonably satisfactory to the Collateral
Agent:
(i) searches of Uniform Commercial Code ("UCC") filings in the
jurisdiction of the chief executive office of each Credit Party and
each jurisdiction where any Collateral is located or where a filing
would need to be made in order to perfect the Lenders' security
interest in the Collateral, copies of the financing statements on
file in such jurisdictions and evidence that no Liens exist other
than Permitted Liens;
(ii) to the extent not previously received by the Collateral
Agent, duly executed UCC financing statements for each appropriate
jurisdiction as is necessary, in the Collateral Agent's sole
discretion, to perfect the Lenders' security interest in the
Collateral;
(iii) searches of ownership of registrations and applications
for Material Intellectual Property in the appropriate governmental
offices in the United States of America and such
patent/trademark/copyright filings as requested by the Collateral
Agent as are reasonably necessary to perfect the security interest
of the Collateral Agent therein in the United States of America;
(iv) to the extent not previously received by the Collateral
Agent, all stock certificates evidencing the stock pledged to the
Collateral Agent pursuant to the Pledge Agreement, together with
duly executed in blank undated stock powers attached thereto; and
(v) to the extent not previously received by the Collateral
Agent, all instruments and chattel paper in the possession of a
Credit Party as required pursuant to the Collateral Documents
together with allonges or assignments as may be necessary or
appropriate to perfect the Lenders' security interest in the
Collateral.
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(e) Real Property Collateral. The Collateral Agent shall have
received, in form and substance reasonably satisfactory to the Collateral
Agent:
(i) (A) fully executed and notarized mortgages, deeds of trust
or deeds to secure debt and/or (B) fully executed and notarized
amendments to existing mortgages, deeds of trust or deeds to secure
debt of record in favor of the Collateral Agent, as appropriate,
(each such mortgage, deed of trust and deed to secure debt and each
existing mortgage, deed of trust and deed to secure debt of record
as amended by the amendments, as appropriate, referenced above
shall be referred to herein as a "Mortgage" and collectively as
"Mortgages") for each real property asset owned by a Credit Party
as set forth on Schedule 5.1(e)(i) (each of those real property
assets on Schedule 5.1(e)(i) being a "Mortgaged Property" and
collectively the "Mortgaged Properties"), together with such UCC-1
or UCC-3 financing statements, as appropriate, as the Collateral
Agent shall deem appropriate with respect to each such Mortgaged
Property;
(ii) (A) fully executed and notarized leasehold mortgages,
deeds of trust or deeds to secure debt and/or (B) fully executed
and notarized amendments to existing leasehold mortgages, deeds of
trust or deeds to secure debt, as appropriate, (each such leasehold
mortgage, deed of trust and deed to secure debt and each existing
leasehold mortgage, deed of trust and deed to secure debt of record
as amended by the amendments, as appropriate, referenced above, a
"Leasehold Mortgage" and collectively the "Leasehold Mortgages")
for each leasehold interest of a Credit Party set forth on Schedule
5.1(e)(ii) (each a "Leasehold Mortgaged Property" and collectively
the "Leasehold Mortgaged Properties"), together with such UCC-1 or
UCC-3 financing statements, as appropriate, as the Collateral Agent
shall deem appropriate with respect to such Leasehold Mortgaged
Properties and evidence that each leasehold estate set forth on
Schedule 5.1(e)(ii) is in the name of a Credit Party;
(iii) ALTA or other appropriate form mortgagee title insurance
policies (the "Mortgage Policies") issued by Chicago Title
Insurance Company or other title insurers satisfactory to the
Collateral Agent (the "Title Insurance Company"), in an amount
satisfactory to the Collateral Agent with respect to each Mortgaged
Property and each Leasehold Mortgaged Property (collectively, the
"Title Properties"), which amount shall not exceed the fair market
value for each such Title Property, assuring the Collateral Agent
that the applicable Mortgages or Leasehold Mortgages, as
applicable, create valid and enforceable first priority mortgage
liens on the respective Title Properties, free and clear of all
defects and encumbrances except Permitted Liens which Mortgage
Policies shall be in form and substance reasonably satisfactory to
the Collateral Agent and containing such endorsements as shall be
reasonably satisfactory to the Collateral Agent and for any other
matters that the Collateral Agent may request, and providing
affirmative insurance and such reinsurance as the Collateral Agent
may request, all of the foregoing in form and substance reasonably
satisfactory to the Agents;
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(iv) to the extent not previously delivered to the Collateral
Agent, maps or plats of an as-built survey of the sites of the
Title Properties certified to the Collateral Agent and the Title
Insurance Company in a manner reasonably satisfactory to them,
dated a date satisfactory to the Collateral Agent and the Title
Insurance Company by an independent professional licensed land
surveyor reasonably satisfactory to the Collateral Agent and the
Title Insurance Company, which maps or plats and the surveys on
which they are based shall be sufficient to delete any standard
printed survey exception contained in the applicable title policy
and be made in accordance with the Minimum Standard Detail
Requirements for Land Title Surveys jointly established and adopted
by the American Land Title Association and the American Congress on
Surveying and Mapping in 1992, and, without limiting the generality
of the foregoing, there shall be surveyed and shown on such maps,
plats or surveys the following: (A) the locations on such sites of
all the buildings, structures and other improvements and the
established building setback lines; (B) the lines of streets
abutting the sites and width thereof; (C) all access and other
easements appurtenant to the sites necessary to use the sites; (D)
all roadways, paths, driveways, easements, encroachments and
overhanging projections and similar encumbrances affecting the
site, whether recorded, apparent from a physical inspection of the
sites or otherwise known to the surveyor; (E) any encroachments on
any adjoining property by the building structures and improvements
on the sites; and (F) if the site is described as being on a filed
map, a legend relating the survey to said map;
(v) an opinion of counsel (which counsel shall be satisfactory
to the Collateral Agent) in the state in which each Mortgaged
Property and Leasehold Mortgaged Property is located with respect
to the enforceability of the Mortgages and Leasehold Mortgages,
standard remedies with respect thereto, and sufficiency of the form
of UCC-1 and/or UCC-3 financing statements to be recorded or filed
in such state and such other matters as the Collateral Agent may
request, in form and substance reasonably satisfactory to the
Collateral Agent (with respect to any Mortgage or Leasehold
Mortgage which is being amended in connection with this Credit
Agreement, counsel shall opine that such Mortgage or Leasehold
Mortgage (together with all amendments thereto) is enforceable
against the respective Credit Party);
(vi) to the extent not previously delivered to the Collateral
Agent, zoning letters from appropriate authorities in form and
substance acceptable to the Collateral Agent or other evidence
satisfactory to the Collateral Agent that each of the Title
Properties, and the uses of the Title Properties, are in compliance
in all material respects with all applicable zoning laws, including
the zoning designation made for each of the Title Properties, the
permitted uses of each such Title Properties under such zoning
designation and zoning requirements as to parking, lot size,
ingress, egress and building setbacks;
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(vii) to the extent not previously delivered to the Collateral
Agent, certification from Bankers Hazard Determination Services or
Borrower's land surveyor in a form reasonably satisfactory to the
Collateral Agent or other evidence acceptable to the Collateral
Agent that none of the improvements on the Title Properties located
within the United States are located within any area designated by
the Director of the Federal Emergency Management Agency as a
"special flood hazard" area or if any improvements on the Title
Properties are located within a "special flood hazard" area,
evidence of a flood insurance policy from a company and in an
amount satisfactory to the Collateral Agent for the applicable
portion of the premises, naming the Collateral Agent, for the
benefit of the Lenders, as mortgagee;
(viii) to the extent not previously delivered to the
Collateral Agent, with respect to the Mortgaged Properties located
in Bridgeview, Illinois and Troy, Ohio, a fully executed and
notarized modification of the existing mortgage or deed of trust in
favor of the issuer of the applicable letter of credit securing the
bond financing on such property, in form and substance acceptable
to the Collateral Agent, which amends and modifies such mortgage or
deed of trust to secure, among other things, the obligations of the
Credit Parties under this Credit Agreement; and
(ix) to the extent not previously delivered to the Collateral
Agent, with respect to the Mortgaged Property located in Grove
City, Pennsylvania, (A) such estoppel letters, consents and waivers
from the owner of such Mortgaged Property and the holder of any
existing mortgage or deed of trust on such Mortgaged Property, as
may be reasonably required by the Collateral Agent, which estoppel
letters shall be in form and substance reasonably satisfactory to
the Collateral Agent and (B) evidence that the installment sale
contract pursuant to which the Borrower's interest in such
Mortgaged Property is derived or a memorandum of such contract with
respect thereto, or other evidence of such contract in form and
substance reasonably satisfactory to the Collateral Agent, has been
recorded in all places to the extent necessary or desirable, in the
reasonable judgment of the Collateral Agent, so as to enable the
Mortgage encumbering such Mortgaged Property to effectively create
a valid and enforceable lien (subject only to Permitted Liens) on
the Borrower's rights and interests in such Mortgaged Property in
favor of the Collateral Agent (or such other Person as may be
required or desired under local law) for the benefit of Lenders.
(f) Environmental Reports. The Administrative Agent shall have
received, in form and substance satisfactory to the Administrative Agent,
environmental site assessment reports and related documents with respect
to all Real Properties.
(g) Financial Statements. Receipt and approval by the
Administrative Agent of (i) the consolidated financial statements of
Holdings, the Borrower and their Subsidiaries for each of the fiscal
years ending December 31, 1994, 1995 and 1996,
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including balance sheets and income and cash flow statements, audited by
nationally recognized independent public accountants and containing an
unqualified opinion of such firm that such statements present fairly, in
all material respects, the consolidated financial position and results of
operations of Holdings, the Borrower and their Subsidiaries, and are
prepared in conformity with GAAP, (ii) unaudited consolidated financial
statements of Holdings, the Borrower and their Subsidiaries for the
fiscal quarter ending June 30, 1997, (iii) company prepared working
capital detail of Holdings, the Borrower and their Subsidiaries for the
most recent twelve month period, together with projections for working
capital for the twelve month period subsequent to the Closing Date, (iv)
a satisfactory proforma consolidated balance sheet of Holdings, the
Borrower and their Subsidiaries as of the Closing Date giving effect to
the transactions contemplated hereby, reviewed by nationally recognized
independent accountants, (v) satisfactory projections of Holdings, the
Borrower or any of their Subsidiaries (the "Projections") for each twelve
month period through the twelve month period ending seven (7) years from
the Closing Date and (vi) such other financial information deemed
reasonably necessary for review in connection herewith.
(h) Evidence of Insurance. Receipt by the Administrative Agent of
copies of insurance policies or certificates of insurance of the Credit
Parties evidencing liability and casualty insurance meeting the
requirements set forth in the Credit Documents, including, but not
limited to, naming the Collateral Agent as additional insured or loss
payee on behalf of the Lenders.
(i) Material Adverse Effect. No event shall have occurred since
December 31, 1996 that has had or would be reasonably expected to have a
Material Adverse Effect.
(j) Litigation. There shall not exist any pending or threatened
action, suit, investigation or proceeding against a Credit Party or any
of their Subsidiaries that would have or would reasonably be expected to
have a Material Adverse Effect.
(k) Officer's Certificates.
(i) The Administrative Agent shall have received a certificate
or certificates executed by the chief financial officer or
treasurer of the Borrower as of the Effective Date stating that (A)
the Borrower and each of the Borrower's Subsidiaries are in
compliance with all existing financial obligations, (B) all
governmental, shareholder and third party consents and approvals,
if any, with respect to the Credit Documents and the transactions
contemplated thereby have been obtained, (C) no action, suit,
investigation or proceeding is pending or, to the best knowledge of
such chief financial officer, threatened in any court or before any
arbitrator or governmental instrumentality that purports to affect
the Borrower, any of the Borrower's Subsidiaries or any transaction
contemplated by the Credit Documents, if such action, suit,
investigation or proceeding could be reasonably expected to have a
Material Adverse Effect, (D) the financial statements and
information delivered to the Administrative Agent on or before the
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Effective Date were prepared in good faith and using reasonable
assumptions, (E) no event or condition has occurred since December
31, 1996 which has had or might be reasonably expected to have a
Material Adverse Effect and (F) immediately after giving effect to
this Credit Agreement, the other Credit Documents and all the
transactions contemplated therein to occur on such date, (1) the
Borrower and each of the Borrower's Subsidiaries is Solvent, (2) no
Default or Event of Default exists, (3) all representations and
warranties contained herein and in the other Credit Documents are
true and correct in all material respects, and (4) the Credit
Parties are in compliance with each of the financial covenants set
forth in Section 7.2.
(ii) The Administrative Agent shall have received a
certificate or certificates executed by the chief financial officer
or treasurer of Holdings as of the Effective Date stating that (A)
Holdings is in compliance with all existing financial obligations
and (B) immediately after giving effect to this Credit Agreement,
the other Credit Documents and all the transactions contemplated
therein, Holdings is Solvent.
(l) Payment of Prior Credit Facility. Receipt by the Administrative
Agent of evidence that all obligations outstanding under the Prior Credit
Agreement have been paid in full and all obligations (other than those
indemnifications that specifically survive) shall be terminated.
(m) Initial Public Offering. Receipt by the Administrative Agent of
evidence satisfactory to the Administrative Agent of the completion of
the initial public offering of common stock of Holdings with net proceeds
received from such offering of at least $90 million.
(n) Subordinated Debt. To the extent not previously received by the
Administrative Agent, copies of all documentation evidencing the
Subordinated Debt certified by an officer of the Borrower and Holdings,
as applicable, to be true and correct, and the Administrative Agent shall
be satisfied that the execution and delivery of the Credit Documents does
not conflict with the terms of the Holdings Debentures or the
Subordinated Notes.
(o) Stock Ownership Arrangements. Receipt by the Administrative
Agent of copies, certified by the Borrower to be true and correct as of
the Effective Date, of all documentation evidencing the stock ownership
arrangements of Management.
(p) Consent. Receipt by the Administrative Agent of evidence that
all governmental, shareholder and material third party consents and
approvals necessary or desirable in connection with the execution and
delivery of the Credit Documents and the consummation of the transactions
set forth therein have been obtained.
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(q) Fees and Expenses. Payment by the Credit Parties of all fees
and expenses owed by them to the Lenders and the Agents, including,
without limitation, payments to the Agents set forth in the Fee Letters.
(r) Other. Receipt by the Lenders of such other documents,
instruments, agreements or information as reasonably and timely requested
by any Lender, including, but not limited to, information regarding
litigation, tax, accounting, labor, insurance, pension liabilities
(actual or contingent), real estate leases, material contracts, debt
agreements, property ownership and contingent liabilities of the Credit
Parties and their Subsidiaries.
5.2 CONDITIONS TO ALL EXTENSIONS OF CREDIT.
In addition to the conditions precedent stated elsewhere herein, the
Lenders shall not be obligated to make Loans (including the obligations of the
Lenders to make the second advance with respect to the Tranche A Term Loans as
set forth in Section 2.3(a) or the obligation of any Lender to fund an increase
in the Tranche B Term Loans in accordance with Section 2.4(b) or (d)), nor
shall an Issuing Lender be required to issue or extend a Letter of Credit
unless:
(a) Notice. The Borrower shall have delivered (i) in the case of
any new Revolving Loan, a Notice of Borrowing, duly executed and
completed, by the time specified in Section 2.1, (ii) in the case of any
Letter of Credit, the applicable Issuing Lender shall have received an
appropriate request for issuance in accordance with the provisions of
Section 2.2 or (iii) in the case of the second advance with respect to
the Tranche A Term Loans or any advance in connection with an increase in
the Tranche B Term Loans, the Borrower shall have delivered notice of its
desire to receive such advance at least one Business Day prior to such
advance;
(b) Representations and Warranties. The representations and
warranties made by the Credit Parties in any Credit Document are true and
correct in all material respects at and as if made as of such date;
(c) No Default. No Default or Event of Default shall exist or be
continuing either prior to or after giving effect thereto;
(d) No Material Adverse Effect. There shall not have occurred any
Material Adverse Effect since December 31, 1996; and
(e) Availability. Immediately after giving effect to the making of
a Revolving Loan (and the application of the proceeds thereof) or to the
issuance of a Letter of Credit, as the case may be, the sum of the
Revolving Loans outstanding plus LOC Obligations outstanding shall not
exceed the Revolving Committed Amount.
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The delivery of each Notice of Borrowing and each request for a Letter of
Credit shall constitute a representation and warranty by the Borrower of the
correctness of the matters specified in subsections (b), (c), (d) and (e)
above.
SECTION 6
REPRESENTATIONS AND WARRANTIES
Each Credit Party hereby represents and warrants to the Agents and each
Lender that:
6.1 ORGANIZATION AND GOOD STANDING.
Holdings, the Borrower and each of their Subsidiaries (a) is a corporation
duly incorporated or formed, validly existing and in good standing (or its
equivalent) under the laws of the State (or other jurisdiction) of its
incorporation or formation, (b) is duly qualified and in good standing as a
foreign corporation authorized to do business in every United States
jurisdiction where the failure to so qualify would have a Material Adverse
Effect and (c) has the requisite corporate power and authority to own its
properties and to carry on its business as now conducted and as proposed to be
conducted.
6.2 DUE AUTHORIZATION.
Each Credit Party (a) has the requisite corporate power and authority to
execute, deliver and perform this Credit Agreement and the other Credit
Documents to which it is a party and to incur the obligations herein and
therein provided for and (b) is duly authorized to, and has been authorized by
all necessary corporate action, to execute, deliver and perform this Credit
Agreement and the other Credit Documents to which it is a party.
6.3 NO CONFLICTS.
Neither the execution and delivery of the Credit Documents, nor the
consummation of the transactions contemplated therein, nor performance of and
compliance with the terms and provisions thereof by such Credit Party will (a)
violate or conflict with any provision of its articles or certificate of
incorporation or bylaws, (b) materially violate, contravene or conflict with
any law, regulation (including, without limitation, Regulation U or Regulation
X), order, writ, judgment, injunction, decree or permit applicable to it, (c)
violate, contravene or materially conflict with contractual provisions of, or
cause an event of default under, any indenture, loan agreement, mortgage, deed
of trust, contract or other agreement or instrument to which it is a party or
by which it may be bound, the violation of which could have or might be
reasonably expected to have a Material Adverse Effect, or (d) result in or
require the creation of any Lien (other than those contemplated in or created
in connection with the Credit Documents) upon or with respect to its
properties.
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6.4 CONSENTS.
No consent, approval, authorization or order of, or filing, registration
or qualification with, any court or Governmental Authority or third party in
respect of any Credit Party is required in connection with the execution,
delivery or performance of this Credit Agreement or any of the other Credit
Documents by a Credit Party, or if required, such consent, approval and
authorization has been obtained.
6.5 ENFORCEABLE OBLIGATIONS.
This Credit Agreement and the other Credit Documents have been duly
executed and delivered and constitute legal, valid and binding obligations of
each Credit Party enforceable against such Credit Party in accordance with
their respective terms, except as may be limited by bankruptcy or insolvency
laws or similar laws affecting creditors' rights generally or by general
equitable principles.
6.6 FINANCIAL CONDITION.
The financial statements and financial information provided to the Lenders
as described in Section 7.1 fairly present the financial condition and
operations of Holdings, the Borrower and their Subsidiaries as of the date of
each such statement. In addition, such financial statements were prepared in
accordance with GAAP and, since the audited financial statements dated December
31, 1996, there have occurred no changes or circumstances which have had or are
likely to have a Material Adverse Effect.
6.7 NO DEFAULT.
No Default or Event of Default has occurred and continues to exist.
6.8 OWNERSHIP.
Other than Permitted Liens, each Credit Party, and each of its
Subsidiaries, is the owner of (free and clear of all Liens) and has good and
marketable title to (a) all of its Mortgaged Properties (except as indicated on
the Mortgage Policies accepted by the Collateral Agent) and (b) all of its
other respective assets.
6.9 INDEBTEDNESS.
The Credit Parties and their Subsidiaries have no Indebtedness except (a)
as disclosed in the financial statements referenced in Section 5.1(g), (b) as
set forth on Schedule 6.9 and (c) as otherwise permitted by this Credit
Agreement.
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6.10 LITIGATION.
There are no actions, suits or legal, equitable, arbitration or
administrative proceedings, pending or, to the knowledge of any Credit Party,
threatened against Holdings, the Borrower or any of their Subsidiaries which
would have or would be reasonably expected to have a Material Adverse Effect.
6.11 MATERIAL AGREEMENTS.
Neither Holdings, the Borrower nor any of their Subsidiaries is in default
in any respect under any contract, lease, loan agreement, indenture, mortgage,
security agreement or other agreement or obligation to which it is a party or
by which any of its properties is bound which default would have or would be
reasonably expected to have a Material Adverse Effect.
6.12 TAXES.
Each of Holdings, the Borrower and their Subsidiaries, has filed, or
caused to be filed, all tax returns (federal, state, local and foreign)
required to be filed and paid all amounts of taxes shown thereon to be due
(including interest and penalties) and has paid all other taxes, fees,
assessments and other governmental charges (including mortgage recording taxes,
documentary stamp taxes and intangibles taxes) owing by it, except for such
taxes (i) which are not yet delinquent or (ii) that are being contested in good
faith and by proper proceedings, and against which adequate reserves are being
maintained in accordance with GAAP in effect from time to time. No Credit
Party is aware of any proposed material tax assessments against it, any of its
Subsidiaries or any other Credit Party.
6.13 COMPLIANCE WITH LAW.
Each of Holdings, the Borrower and their Subsidiaries, is in compliance
with all laws, rules, regulations, orders and decrees (including without
limitation Environmental Laws) applicable to it, or to its properties, unless
such failure to comply would not have or be reasonably expected to have a
Material Adverse Effect.
6.14 ERISA.
Except as would not result or be reasonably expected to result in a
Material Adverse Effect:
(a) During the five-year period prior to the date on which this
representation is made or deemed made: (i) no Termination Event has
occurred, and, to the best knowledge of the Credit Parties, no event or
condition has occurred or exists as a result of which any Termination
Event could reasonably be expected to occur, with respect to any Plan;
(ii) no "accumulated funding deficiency," as such term is defined in
Section 302 of ERISA and Section 412 of the Code, whether or not waived,
has occurred with respect to any Plan; (iii) each Plan has been
maintained, operated, and funded in compliance with its
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own terms and in material compliance with the provisions of ERISA, the
Code, and any other applicable federal or state laws; and (iv) no lien in
favor of the PBGC or a Plan has arisen or is reasonably likely to arise
on account of any Plan.
(b) The actuarial present value of all "benefit liabilities" under
each Single Employer Plan (determined within the meaning of Section
401(a)(2) of the Code, utilizing the actuarial assumptions used to fund
such Plans), whether or not vested, did not, as of the last annual
valuation date prior to the date on which this representation is made or
deemed made, exceed the current value of the assets of such Plan
allocable to such accrued liabilities.
(c) Neither a Credit Party, nor any of its Subsidiaries nor any
ERISA Affiliate has incurred, or, to the best knowledge of the Credit
Parties, are reasonably expected to incur, any withdrawal liability under
ERISA to any Multiemployer Plan or Multiple Employer Plan. Neither the
Borrower, any of its Subsidiaries nor any ERISA Affiliate has received
any notification that any Multiemployer Plan is in reorganization (within
the meaning of Section 4241 of ERISA), is insolvent (within the meaning
of Section 4245 of ERISA), or has been terminated (within the meaning of
Title IV of ERISA), and no Multiemployer Plan is, to the best knowledge
of the Credit Parties, reasonably expected to be in reorganization,
insolvent, or terminated.
(d) No prohibited transaction (within the meaning of Section 406 of
ERISA or Section 4975 of the Code) or breach of fiduciary responsibility
has occurred with respect to a Plan which has subjected or is reasonably
likely to subject the Borrower or any of its Subsidiaries or any ERISA
Affiliate to any liability under Sections 406, 409, 502(i), or 502(l) of
ERISA or Section 4975 of the Code, or under any agreement or other
instrument pursuant to which the Borrower or any of its Subsidiaries or
any ERISA Affiliate has agreed or is required to indemnify any person
against any such liability.
(e) The present value (determined using actuarial and other
assumptions which are reasonable with respect to the benefits provided
and the employees participating) of the liability of the Borrower and its
Subsidiaries and each ERISA Affiliate for post-retirement welfare
benefits to be provided to their current and former employees under Plans
which are welfare benefit plans (as defined in Section 3(1) of ERISA),
net of all assets under all such Plans allocable to such benefits, are
reflected on the Financial Statements in accordance with FASB 106.
(f) Each Plan which is a welfare plan (as defined in Section 3(1) of
ERISA) to which Sections 601-609 of ERISA and Section 4980B of the Code
apply has been administered in compliance in all material respects with
such sections.
6.15 SUBSIDIARIES.
Set forth on Schedule 6.15 is a complete and accurate list of all
Subsidiaries of each Credit Party as of the Closing Date. Information on
Schedule 6.15 includes, as of the Closing
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Date, jurisdiction of incorporation; the number of shares of each class of
capital stock or other equity interests outstanding; the number and percentage
of outstanding shares of each class owned (directly or indirectly) by such
Credit Party; and the number and effect, if exercised, of all outstanding
options, warrants, rights of conversion or purchase and all other similar
rights with respect thereto. The outstanding capital stock and other equity
interests of all such Subsidiaries is validly issued, fully paid and
non-assessable and is owned by each such Credit Party, directly or indirectly,
free and clear of all Liens (other than those arising under or contemplated in
connection with the Credit Documents). Other than as set forth in Schedule
6.15, as of the Closing Date, neither any Credit Party nor any Subsidiary
thereof has outstanding any securities convertible into or exchangeable for its
capital stock nor does any such Person have outstanding any rights to subscribe
for or to purchase or any options for the purchase of, or any agreements
providing for the issuance (contingent or otherwise) of, or any calls,
commitments or claims of any character relating to its capital stock.
6.16 USE OF PROCEEDS; MARGIN STOCK.
The proceeds of the Loans hereunder will be used solely for the purposes
specified in Section 7.11. None of the proceeds of the Loans will be used in
a manner which would violate or result in a violation of Regulation U,
Regulation X or Regulation G or for any other purpose which might be
inconsistent with the provisions of Regulation U, Regulation X, Regulation G or
Regulation T. As of the Closing Date, none of the Credit Parties owns any
Margin Stock. Following the application of the proceeds of each Loan, less
than 25% of the value (as determined by any reasonable method) of the assets of
Holdings and its Subsidiaries (on a consolidated and an unconsolidated basis)
taken as a whole are and will continue to be, Margin Stock, it being understood
that the Credit Parties may only purchase Margin Stock if it qualifies as a
Permitted Investment.
6.17 GOVERNMENT REGULATION.
No Credit Party, nor any of its Subsidiaries, is subject to regulation
under the Public Utility Holding Company Act of 1935, the Federal Power Act,
the Investment Company Act of 1940 or the Interstate Commerce Act, each as
amended. In addition, no Credit Party is an "investment company" registered
or required to be registered under the Investment Company Act of 1940, as
amended, or controlled by such a company, or a "holding company," or a
"Subsidiary company" of a "holding company," or an "affiliate" of a "holding
company" or of a "Subsidiary" or a "holding company," within the meaning of the
Public Utility Holding Company Act of 1935, as amended.
6.18 ENVIRONMENTAL MATTERS.
(a) Except to the extent it would not cause or be reasonably
expected to cause a Material Adverse Effect:
(i) each of the Real Properties and all other real property
owned or leased by any Credit Party or any one of its Subsidiaries
(collectively, the
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the "Properties") and all operations at the Properties are in
compliance with all applicable Environmental Laws, and there is no
violation of any Environmental Law with respect to the Properties
or the businesses operated by a Credit Party or any of their
Subsidiaries (the "Businesses"), and there are no conditions
relating to the Businesses or Properties that could give rise to
liability under any applicable Environmental Laws.
(ii) None of the Properties contains, or has previously
contained, any Hazardous Materials at, on or under the Properties
in amounts or concentrations that, if release, constitute or
constituted a violation of, or could give rise to liability under,
Environmental Laws.
(iii) No Credit Party has received any written or verbal
notice of, or inquiry from any Governmental Authority, any
violation, alleged violation, non-compliance, liability or
potential liability regarding environmental matters or compliance
with Environmental Laws with regard to any of the Properties or the
Businesses, nor does any Credit Party have knowledge or reason to
believe that any such notice is being threatened.
(iv) Hazardous Materials have not been transported or disposed
of from the Properties, or generated, treated, stored or disposed
of at, on or under any of the Properties or any other location, in
each case by or on behalf of any Credit Party or any of their
Subsidiaries.
(v) No judicial proceeding or governmental or administrative
action is pending or, to the knowledge of a Credit Party,
threatened, under any Environmental Law to which a Credit Party or
any of their Subsidiaries is or will be named as a party, nor are
there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or
judicial requirements outstanding under any Environmental Law with
respect to a Credit Party or any of their Subsidiaries, the
Properties or the Businesses.
(vi) There has been no release or threat of release of
Hazardous Materials at or from the Properties, or arising from or
related to the operations (including, without limitation, disposal)
of a Credit Party or any of their Subsidiaries in connection with
the Properties or otherwise in connection with the Businesses.
(vii) Neither a Credit Party nor any of their Subsidiaries has
assumed any liability of any Person (other than another Credit
Party) under any Environmental Law.
(b) The Borrower has adopted procedures that are designed to (i)
ensure that each Credit Party and their Subsidiaries, any of their
operations and each of the properties owned or leased by each Credit
Party and their Subsidiaries remains in material
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compliance with applicable Environmental Laws and (ii) minimize any
liabilities or potential liabilities that each Credit Party and their
Subsidiaries, any of their operations and each of the properties owned or
leased by each Credit Party and their Subsidiaries may have under
applicable Environmental Laws.
(c) As of the Closing Date, no Credit Party is aware of any material
environmental issues other than as set forth on Schedule 6.18, none of
which has caused or could be reasonably expected to cause a Material
Adverse Effect.
6.19 INTELLECTUAL PROPERTY.
Each Credit Party and each of their Subsidiaries owns, or has the legal
right to use, all Material Intellectual Property owned or licensed by it. Set
forth on Schedule 6.19 is a list of all registrations and applications for
Material Intellectual Property owned by each Credit Party and a list of all
license agreements to which a Credit Party is a party relating to Material
Intellectual Property that any Credit Party has the right to use as of the
Closing Date. Except as provided on Schedule 6.19, as of the Closing Date, no
claim has been asserted and is pending by any Person against any Credit Party
challenging or questioning the use of any such Material Intellectual Property
or the validity or effectiveness of any such Material Intellectual Property,
nor does any Credit Party know of any such claim, and to the Credit Parties'
knowledge the use of such Material Intellectual Property by a Credit Party or
any of their Subsidiaries does not infringe on the rights of any Person.
Except as set forth on Schedule 6.19, as of the Closing Date, none of the
Material Intellectual Property owned by a Credit Party is the subject of any
licensing or franchise agreement.
6.20 SOLVENCY.
Each Credit Party is and, after consummation of the transactions
contemplated by this Credit Agreement, will be Solvent.
6.21 INVESTMENTS.
All Investments of each Credit Party and each of their Subsidiaries are
either Permitted Investments or otherwise permitted by the terms of this Credit
Agreement.
6.22 LOCATION OF COLLATERAL.
Set forth on Schedule 6.22(a) is a list of all Real Properties with street
address, county or district and state where located as of the Closing Date.
Set forth on Schedule 6.22(b) is a list of all locations where any personal
property of a Credit Party is located, including county or district and state
where located as of the Closing Date. Set forth on Schedule 6.22(c) is the
chief executive office and principal place of business of each Credit Party as
of the Closing Date.
6.23 NO FINANCING OF CORPORATE TAKEOVERS.
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No proceeds of the Loans hereunder have been or will be used to acquire,
directly or indirectly, any security in any transaction which is subject to
Sections 13 or 14 of the Securities Exchange Act of 1934, as amended,
(including, without limitation, Sections 13(d) and 14(d) thereof) or to
refinance any Indebtedness used to acquire any such securities.
6.24 DISCLOSURE.
Neither (a) this Credit Agreement nor (b) any financial statements
delivered to the Lenders nor (c) any other document, certificate or written
statement on the date as of which such document, certificate or statement is
made or certified, furnished to the Lenders by any Credit Party (including any
officer or director of a Credit Party) in connection with the transactions
contemplated hereby contains any untrue statement of a material fact or omits
to state a material fact necessary in order to make the statements contained
therein or herein in light of the circumstances in which they were made, taken
as a whole, not misleading; provided that projections and assumptions expressed
in the information, exhibits, reports, certificates, statements and documents
so furnished were reasonable based on the information available at the time so
furnished, but no Credit Party makes any representation or warranty that such
projections or assumptions will prove in the future to be accurate or that any
Credit Party or any of their Subsidiaries will achieve the financial results
reflected therein.
6.25 LICENSES, ETC.
The Credit Parties have obtained and hold in full force and effect, all
franchises, licenses, permits, certificates, authorizations, qualifications,
accreditations, easements, rights of way and other rights, consents and
approvals which are necessary for the operation of their respective businesses
as presently conducted, except where the failure to obtain same would not have
a Material Adverse Effect.
6.26 NO BURDENSOME RESTRICTIONS.
No Credit Party, nor any of their Subsidiaries, is a party to any
agreement or instrument or subject to any charter or corporate restriction
which, individually or in the aggregate, would have or be reasonably expected
to have a Material Adverse Effect.
6.27 COLLATERAL DOCUMENTS.
The Collateral Documents create valid security interests in, and Liens on,
the Collateral purported to be covered thereby, which security interests and
Liens are and will remain perfected security interests and Liens to the extent
required by the Collateral Documents, prior to all other Liens other than
Permitted Liens. Each of the representations and warranties made by the Credit
Parties and their Subsidiaries in the Collateral Documents is true and correct
in all material respects. Notwithstanding the foregoing, certain Collateral
can only be perfected upon the filing of adequate financing statements in
appropriate filing offices.
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SECTION 7
AFFIRMATIVE COVENANTS
Each Credit Party hereby covenants and agrees that until the Loans and LOC
Obligations, together with interest and fees and other obligations hereunder
other than obligations that expressly survive the termination of this Credit
Agreement, have been paid in full and the Commitments and Letters of Credit
hereunder shall have terminated:
7.1 INFORMATION COVENANTS.
The Borrower will furnish, or cause to be furnished, to the Administrative
Agent and, except as otherwise specifically provided below, each of the
Lenders:
(a) Annual Financial Statements. As soon as available, and in any
event within 90 days after the close of each fiscal year of the Borrower,
a consolidated balance sheet and income statement of Holdings and its
Subsidiaries and the Borrower and its Subsidiaries, as of the end of such
fiscal year, together with related consolidated statements of operations
and retained earnings and of cash flows for such fiscal year, setting
forth in comparative form consolidated figures for the preceding fiscal
year, all such financial information described above to be in reasonable
form and detail and audited by independent certified public accountants
of recognized national standing reasonably acceptable to the
Administrative Agent and whose opinion shall be to the effect that such
financial statements have been prepared in accordance with GAAP (except
for changes with which such accountants concur) and shall not be limited
as to the scope of the audit or qualified in any manner.
(b) Quarterly Financial Statements. As soon as available, and in
any event within 45 days after the close of each of the first three
fiscal quarters of the Borrower (other than the fourth fiscal quarter, in
which case 90 days after the end thereof), (i) a consolidated balance
sheet and income statement of Holdings and its Subsidiaries, and the
Borrower and its Subsidiaries, as of the end of such fiscal quarter,
together with related consolidated statements of operations and retained
earnings and of cash flows for such fiscal quarter in each case setting
forth in comparative form consolidated figures for the corresponding
period of the preceding fiscal year, all such financial information
described above to be in reasonable form and detail and reasonably
acceptable to the Administrative Agent, and accompanied by a management
discussion as to such financial information and a certificate of the
chief financial officer or treasurer of the Borrower to the effect that
such quarterly financial statements fairly present in all material
respects the financial condition and results of operations of Holdings,
the Borrower and their Subsidiaries and have been prepared in accordance
with GAAP, subject to changes resulting from audit and normal year-end
audit adjustments.
(c) Monthly Financial Statements. As soon as available and in any
event within 35 days after the end of each month of the Borrower (other
than the last month of
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the first three fiscal quarters in which case 45 days after the end
thereof), a consolidated balance sheet and income statement of Holdings
and its Subsidiaries, and the Borrower and its Subsidiaries as at the end
of such month, together with related consolidated statements of
operations and retained earnings and of cash flows for such month in each
case setting forth in comparative form consolidated figures for the
corresponding period of the preceding fiscal year (and such other
financial information as reasonably requested by the Administrative Agent
or the Required Lenders, including financial information regarding the
divisions of the Borrower), all such financial information described
above to be in reasonable form and detail and reasonably acceptable to
the Administrative Agent, and accompanied by a management discussion as
to such financial information and a certificate of the chief financial
officer or treasurer of the Borrower to the effect that such monthly
financial statements fairly present in all material respects the
financial condition and results of operations of Holdings, the Borrower
and their Subsidiaries and have been prepared in accordance with GAAP,
subject to changes resulting from audit and normal year-end audit
adjustments.
(d) Officer's Certificate. At the time of delivery of the financial
statements provided for in Sections 7.1(a) and 7.1(b) above, a
certificate of the chief financial officer or treasurer of the Borrower
substantially in the form of Exhibit 7.1(d), (i) demonstrating compliance
with the financial covenants contained in Section 7.2 by calculation
thereof as of the end of each such fiscal period, (ii) demonstrating
compliance with any other terms of the Credit Agreement as requested by
the Administrative Agent and (iii) stating that no Default or Event of
Default exists, or if any Default or Event of Default does exist,
specifying the nature and extent thereof and what action the Borrower
proposes to take with respect thereto. The Borrower shall also deliver a
copy of such certificate to the Agency Services Address.
(e) Annual Business Plan and Budgets. At least 30 days after the
end of each fiscal year of the Borrower, beginning with the fiscal year
ending December 31, 1997, an annual business plan and budget of Holdings,
the Borrower and each of its operating groups containing, among other
things, pro forma financial statements for the next fiscal year.
(f) Compliance With Certain Provisions of the Credit Agreement.
Within 90 days after the end of each fiscal year of the Borrower, the
Borrower shall deliver a certificate, containing information regarding
(i) the calculation of Excess Cash Flow, and (ii) the amount of any Asset
Dispositions, Debt Issuances, Equity Issuances and Receivables
Transactions that were made during the prior fiscal year.
(g) Accountant's Certificate. Within the period for delivery of the
annual financial statements provided in Section 7.1(a), a certificate of
the accountants conducting the annual audit stating that they have
reviewed this Credit Agreement and stating further whether, in the course
of their audit, they have become aware of any Default or Event of Default
and, if any such Default or Event of Default exists, specifying the
nature and extent thereof.
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(h) Auditor's Reports. Promptly upon receipt thereof, a copy of any
"management letter" submitted by independent accountants to Holdings, the
Borrower or any of their Subsidiaries in connection with any annual,
interim or special audit of the books of Holdings, the Borrower or any of
their Subsidiaries.
(i) Reports. Promptly upon transmission or receipt thereof, (a)
copies of any filings and registrations with, and reports to or from, the
Securities and Exchange Commission, or any successor agency, and copies
of all financial statements, proxy statements, notices and reports as
Holdings, the Borrower or any of their Subsidiaries shall send to its
shareholders generally or to a holder of any Indebtedness owed by
Holdings, the Borrower or any of their Subsidiaries in its capacity as
such a holder and (b) upon the written request of the Administrative
Agent, all reports and written information to and from the United States
Environmental Protection Agency, or any state or local agency responsible
for environmental matters, the United States Occupational Health and
Safety Administration, or any state or local agency responsible for
health and safety matters, or any successor agencies or authorities
concerning environmental, health or safety matters.
(j) Notices. Upon a Credit Party obtaining knowledge thereof, such
Credit Party will give written notice to the Administrative Agent
immediately of (a) the occurrence of an event or condition consisting of
a Default or Event of Default, specifying the nature and existence
thereof and what action the Borrower proposes to take with respect
thereto, and (b) the occurrence of any of the following with respect to
Holdings, the Borrower or any of their Subsidiaries (i) the pendency or
commencement of any litigation, arbitral or governmental proceeding
against Holdings, the Borrower or any of their Subsidiaries which if
adversely determined would have or would be reasonably expected to have a
Material Adverse Effect, or (ii) the institution of any proceedings
against Holdings, the Borrower or any of their Subsidiaries with respect
to, or the receipt of notice by such Person of potential liability or
responsibility for violation, or alleged violation of any federal, state
or local law, rule or regulation, including but not limited to,
Environmental Laws, the violation of which would have or would be
reasonably expected to have a Material Adverse Effect.
(k) ERISA. Upon any of the Credit Parties or any ERISA Affiliate
obtaining knowledge thereof, the Borrower will give written notice to the
Administrative Agent promptly (and in any event within five Business
Days) of any of the following which would have or would be reasonably
expected to have a Material Adverse Effect: (i) any event or condition,
including, but not limited to, any Reportable Event, that constitutes, or
might reasonably lead to, a Termination Event; (ii) with respect to any
Multiemployer Plan, the receipt of notice as prescribed in ERISA or
otherwise of any withdrawal liability assessed against the Credit Parties
or any of their ERISA Affiliates, or of a determination that any
Multiemployer Plan is in reorganization or insolvent (both within the
meaning of Title IV of ERISA); (iii) the failure to make full payment on
or before the due date (including extensions) thereof of all amounts
which Holdings, the Borrower or any of
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their Subsidiaries or ERISA Affiliates is required to contribute to each
Plan pursuant to its terms and as required to meet the minimum funding
standard set forth in ERISA and the Code with respect thereto; or (iv)
any change in the funding status of any Plan that could have a Material
Adverse Effect; together, with a description of any such event or
condition or a copy of any such notice and a statement by a principal
financial officer of the Borrower briefly setting forth the details
regarding such event, condition, or notice, and the action, if any, which
has been or is being taken or is proposed to be taken by the Credit
Parties with respect thereto. Promptly upon request, the Borrower shall
furnish the Administrative Agent with such additional information
concerning any Plan as may be reasonably requested (and in the case of a
Multiemployer Plan is reasonably available to the Credit Parties or their
Subsidiaries), including, but not limited to, copies of each annual
report/return (Form 5500 series), as well as all schedules and
attachments thereto required to be filed with the Department of Labor
and/or the Internal Revenue Service pursuant to ERISA and the Code,
respectively, for each "plan year" (within the meaning of Section 3(39)
of ERISA).
(l) Environmental.
(i) Upon the reasonable written request of the Administrative
Agent, the Borrower will furnish or cause to be furnished to the
Administrative Agent, at the Borrower's expense, a report of an
environmental assessment of reasonable scope, form and depth,
including, where appropriate, invasive soil or groundwater
sampling, by a consultant reasonably acceptable to the
Administrative Agent as to the nature and extent of the presence of
any Hazardous Materials on any property owned, leased or operated
by a Credit Party and as to the compliance by the Credit Parties
with Environmental Laws. If the Borrower fails to deliver such an
environmental report within seventy-five (75) days after receipt of
such written request then the Administrative Agent may arrange for
same, and the Borrower hereby grants to the Administrative Agent
and its representatives access to such properties and a license of
a scope reasonably necessary to undertake such an assessment
(including, where appropriate, invasive soil or groundwater
sampling). The reasonable cost of any assessment arranged for by
the Administrative Agent pursuant to this provision will be payable
by the Borrower on demand and added to the obligations secured by
the Collateral Documents.
(ii) Each Credit Party will conduct and complete all
investigations, studies, sampling, and testing and all remedial,
removal, and other actions necessary to address all Hazardous
Materials on, from, or affecting any real property owned or leased
by a Credit Party to the extent necessary to be in compliance with
all Environmental Laws and all other applicable federal, state, and
local laws, regulations, rules and policies and with the orders and
directives of all Governmental Authorities exercising jurisdiction
over such real property to the extent any failure to do so would
cause or be reasonably expected to cause a Material Adverse Effect.
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(m) Other Information. With reasonable promptness upon any such
request, such other information regarding the business, properties or
financial condition of the Credit Parties and their Subsidiaries as the
Administrative Agent or the Required Lenders may reasonably request.
7.2 FINANCIAL COVENANTS.
(a) Leverage Ratio. The Leverage Ratio, as of the end of each
fiscal quarter, for the twelve month period ending on such date, shall be
less than or equal to:
(i) From the Effective Date to and including March 31, 1998,
5.0 to 1.0;
(ii) From April 1, 1998 to and including September 30, 1998,
4.5 to 1.0;
(iii) From October 1, 1998 to and including September 30,
1999, 4.25 to 1.0;
(iv) From October 1, 1999 to and including September 30, 2000,
3.75 to 1.0; and
(v) From October 1, 2000 and thereafter, 3.5 to 1.0.
(b) Interest Coverage Ratio. The Interest Coverage Ratio, as of the
end of each fiscal quarter, for the twelve month period ending on such
date, shall be greater than or equal to:
(i) From the Effective Date to and including March 31, 1998,
2.35 to 1.0;
(ii) From April 1, 1998 to and including September 30, 1998,
2.4 to 1.0;
(iii) From October 1, 1998 to and including September 30,
1999, 2.5 to 1.0;
(iv) From October 1, 1999 to and including September 30, 2000,
2.75 to 1.0; and
(v) From October 1, 2000 and thereafter, 3.0 to 1.0.
(c) Net Worth. At all times Net Worth shall be greater than or
equal to:
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(i) From the Effective Date to and including December 30,
1997, negative Sixty Million (-$60,000,000);
(ii) From December 31, 1997 to and including March 30, 1998,
negative Fifty Five Million (-$55,000,000);
(iii) From March 31, 1998 to and including June 29, 1998,
negative Fifty Million (-$50,000,000);
(iv) From June 30, 1998 to and including September 29, 1998,
negative Forty Five Million (-$45,000,000);
(v) From September 30, 1998 to and including December 30,
1998, negative Forty Million (-$40,000,000);
(vi) From December 31, 1998 to and including December 30,
1999, negative Thirty Five Million (-$35,000,000);
(vii) From December 31, 1999 to and including December 30,
2000, negative Twenty Million (-$20,000,000);
(viii) From December 31, 2000 to and including December 30,
2001, Five Million ($5,000,000);
(ix) From December 31, 2001 to and including December 30,
2002, Twenty Five Million ($25,000,000);
(x) From December 31, 2002 to and including December 30, 2003,
Forty Five Million ($45,000,000); and
(xi) From December 31, 2003 and thereafter, Sixty Five Million
($65,000,000).
(d) Fixed Charge Coverage. The Fixed Charge Coverage Ratio, as of
the end of each fiscal quarter, for the twelve month period ending on
such date, shall be greater than or equal to 1.0 to 1.0.
7.3 PRESERVATION OF EXISTENCE AND FRANCHISES.
Each of the Credit Parties will, and will cause its Subsidiaries to, do
all things necessary to preserve and keep in full force and effect its
existence, rights, franchises and authority unless any such Credit Party
determines that any such rights, franchises or authority is no longer necessary
to the conduct of its business.
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7.4 BOOKS AND RECORDS.
Each of the Credit Parties will, and will cause its Subsidiaries to, keep
complete and accurate books and records of its transactions in accordance with
good accounting practices on the basis of GAAP (including the establishment and
maintenance of appropriate reserves).
7.5 COMPLIANCE WITH LAW.
Each of the Credit Parties will, and will cause its Subsidiaries to,
comply with all laws, rules, regulations and orders, and all applicable
restrictions imposed by all Governmental Authorities, applicable to it and its
property (including, without limitation, Environmental Laws) if noncompliance
with any such law, rule, regulation, order or restriction would have or
reasonably be expected to have a Material Adverse Effect.
7.6 PAYMENT OF TAXES AND OTHER INDEBTEDNESS.
Each of the Credit Parties will, and will cause its Subsidiaries to, pay
and discharge (a) all taxes, assessments and governmental charges or levies
imposed upon it, or upon its income or profits, or upon any of its properties,
before they shall become delinquent, (b) all lawful claims (including claims
for labor, materials and supplies) which, if unpaid, might give rise to a Lien
upon any of its properties, and (c) except as prohibited hereunder, all of its
other Indebtedness as it shall become due; provided, however, that a Credit
Party or its Subsidiary shall not be required to pay (i) any such tax,
assessment, charge, levy, claim or Indebtedness which is being contested in
good faith by appropriate proceedings and as to which adequate reserves
therefor have been established in accordance with GAAP or (ii) any such payment
in (a), (b) or (c) above if the failure to make such payment does not give rise
to an immediate right to foreclose on a Lien securing such amounts or would not
have or be reasonably expected to cause a Material Adverse Effect.
7.7 INSURANCE.
Each of the Credit Parties will at all times maintain in full force and
effect insurance (including worker's compensation insurance, liability
insurance, casualty insurance and business interruption insurance) in such
amounts, covering such risks and liabilities and with such deductibles or
self-insurance retentions as are in accordance with normal industry practice.
All policies shall have the Collateral Agent, on behalf of the Lenders, as an
additional insured or loss payee.
In the event there occurs any material loss, damage to or destruction of the
Collateral of any Credit Party or any part thereof, such Credit Party shall
promptly give written notice thereof to the Administrative Agent generally
describing the nature and extent of such damage or destruction. In the case of
any such loss, damage to or destruction of the Collateral of any Credit Party
or any part thereof, such Credit Party, whether or not the insurance proceeds,
if any, received on account of such damage or destruction shall be sufficient
for that purpose, at such Credit Party's cost and expense, will promptly repair
or replace the Collateral of such Credit
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Party so lost, damaged or destroyed; provided, however, that such Credit Party
need not repair or replace the Collateral of such Credit Party so lost, damaged
or destroyed to the extent the failure to make such repair or replacement (a)
is desirable to the proper conduct of the business of such Credit Party in the
ordinary course and otherwise is in the best interest of such Credit Party and
(b) would not materially impair the rights and benefits of the Administrative
Agent or the Lenders under this Credit Agreement or any other Credit Document.
In the event a Credit Party shall receive any proceeds of such insurance in a
net amount in excess of $5,000,000 for any single occurrence, such Credit Party
will immediately pay over such proceeds to the Administrative Agent, for
payment on the Credit Party Obligations; provided, however, that the
Administrative Agent agrees to release such insurance proceeds to such Credit
Party for replacement or restoration of the portion of the Collateral of such
Credit Party lost, damaged or destroyed if, but only if, (A) no Default or
Event of Default shall have occurred and be continuing at the time of release,
(B) written application for such release is received by the Administrative
Agent from such Credit Party within 30 days after written notice of receipt of
such proceeds and (C) the Administrative Agent has received evidence reasonably
satisfactory to it that the Collateral lost, damaged or destroyed has been or
will be replaced or restored to its condition immediately prior to the loss,
destruction or other event giving rise to the payment of such insurance
proceeds or such proceeds are used in a manner reasonably acceptable to the
Administrative Agent. All insurance proceeds shall be subject to the security
interest of the Collateral Agent under the Security Agreement.
The present insurance coverage as of the Closing Date of Holdings, the Borrower
and their Subsidiaries is outlined as to carrier, policy number, expiration
date, type and amount on Schedule 7.7. The Borrower agrees to provide to the
Administrative Agent notice once per annum as to any material changes in such
insurance coverage.
7.8 MAINTENANCE OF PROPERTY.
Each of the Credit Parties will, and will cause its Subsidiaries to,
maintain and preserve its properties and equipment material to the conduct of
its business in good repair, working order and condition, normal wear and tear
excepted, and will make, or cause to be made, in such properties and equipment
from time to time all repairs, renewals, replacements, extensions, additions,
betterments and improvements thereto as may be needed or proper, to the extent
and in the manner customary for companies in similar businesses unless any such
Credit Party determines any such properties or equipment are no longer
necessary to the conduct of its business.
7.9 PERFORMANCE OF OBLIGATIONS.
Each of the Credit Parties will, and will cause its Subsidiaries to,
perform in all material respects all of its obligations under the terms of all
material agreements, indentures, mortgages, security agreements or other debt
instruments to which it is a party or by which it is bound.
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7.10 COLLATERAL.
If, subsequent to the Effective Date, a Credit Party shall (i) acquire any
personal property which would be required to be delivered to the Collateral
Agent in accordance with the Collateral Documents or any fee simple interest in
real property, Material Intellectual Property or securities or (ii) enter into
any lease agreement with respect to any real property (not including immaterial
office space) not part of the Real Properties as of the Closing Date, the
Borrower shall notify the Administrative Agent of same in each case as soon as
practicable after the acquisition thereof or execution of such lease agreement,
as appropriate. Each Credit Party shall adhere to the covenants regarding the
location of personal property as set forth in the Security Agreement. Each
Credit Party shall take such action, as reasonably requested by the
Administrative Agent, to ensure that the Lenders have a first priority
perfected Lien in all real and personal property of the Credit Parties as set
forth in the Collateral Documents (whether now owned or hereafter acquired),
subject only to Permitted Liens.
7.11 USE OF PROCEEDS.
The Credit Parties will use the proceeds of the Loans solely (a) to
refinance all Indebtedness outstanding under the Prior Credit Agreement, (b) to
repurchase Subordinated Notes and Holding Debentures, (c) to pay premiums, fees
and expenses in connection with the Credit Agreement and the repurchase of
Subordinated Notes and Holdings Debentures, (d) to provide letters of credit
for general corporate purposes including the credit enhancement of the existing
outstanding principal balance under certain industrial revenue bonds in
connection with the Mortgaged Properties, (e) to provide working capital and
for general corporate purposes including Permitted Investments, (f) to make
Permitted Acquisitions and (g) to provide loans to Management pursuant to stock
ownership arrangements of Management in an amount not to exceed $15,000,000 in
the aggregate. The Credit Parties will use the Letters of Credit solely for
the purposes set forth in Section 2.2(a).
7.12 AUDITS/INSPECTIONS.
Upon reasonable notice and during normal business hours, each Credit Party
will permit, and will cause its Subsidiaries to permit, representatives
appointed by the Administrative Agent, including, without limitation,
independent accountants, agents, attorneys and appraisers to visit and inspect
such Credit Party's property, including its books and records, its accounts
receivable and inventory, its facilities and its other business assets, and to
make photocopies or photographs thereof and to write down and record any
information such representative obtains and shall permit the Administrative
Agent or its representatives to investigate and verify the accuracy of
information provided to the Lenders, and to discuss all such matters with the
officers, employees and representatives of the Credit Parties. The Credit
Parties agree that the Administrative Agent and its representatives may conduct
an annual audit of the Collateral (or may audit the Collateral at any time
during the existence of an Event of Default), at the expense of the Borrower.
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7.13 ADDITIONAL CREDIT PARTIES.
At the time any Person becomes a Subsidiary of a Credit Party, the
Borrower shall so notify the Administrative Agent and promptly thereafter (but
in any event within 30 days after the date thereof) shall cause such Person to
(a) if it is a Domestic Subsidiary, execute a Joinder Agreement in
substantially the same form as Exhibit 7.13, (b) cause all of the capital stock
of such Person (if it is a Domestic Subsidiary) or 65% of the capital stock of
such Person (if it is a First Tier Foreign Subsidiary) to be delivered to the
Collateral Agent (together with undated stock powers signed in blank) and
pledged to the Collateral Agent pursuant to an appropriate pledge agreement in
substantially the form of the Pledge Agreement (or a joinder to the existing
Pledge Agreement) and otherwise in a form acceptable to the Collateral Agent,
(c) if such Person is a Domestic Subsidiary, pledge all of its assets to the
Collateral Agent pursuant to a security agreement in substantially the form of
the Security Agreement (or a joinder to the existing Security Agreement) and
otherwise in a form acceptable to the Collateral Agent, and (d) if such Person
is a Domestic Subsidiary and has any Subsidiaries, (A) deliver all of the
capital stock of such Domestic Subsidiaries owned by it and 65% of the stock of
the First Tier Foreign Subsidiaries owned by it (together with undated stock
powers signed in blank) to the Collateral Agent and (B) execute a pledge
agreement in substantially the form of the Pledge Agreement (or a joinder to
the existing Pledge Agreement) and otherwise in a form acceptable to the
Collateral Agent, (e) if such Person is a Domestic Subsidiary and owns or
leases any real property, execute any and all necessary mortgages, deeds of
trust, deeds to secure debt or other appropriate real estate collateral
documentation in a form acceptable to the Collateral Agent (or use its
commercially reasonable efforts to cause to be delivered to the Collateral
Agent a landlord waiver or estoppel letter with respect thereto in a form
reasonably acceptable to the Collateral Agent) and (f) deliver such other
documentation as the Collateral Agent may reasonably request in connection with
the foregoing, including, without limitation, appropriate UCC-1 financing
statements, real estate title insurance policies, environmental reports,
landlord's waivers, certified resolutions and other organizational and
authorizing documents of such Person and favorable opinions of counsel to such
Person (which shall cover, among other things, the legality, validity, binding
effect and enforceability of the documentation referred to above), all in form,
content and scope reasonably satisfactory to the Collateral Agent.
7.14 INTEREST RATE PROTECTION AGREEMENTS.
Within ninety (90) days after the Closing Date, the Borrower shall enter
into and maintain interest rate protection agreements, in form and substance
acceptable to Administrative Agent, protecting against, for a period expiring
no earlier than three years from the date such interest rate protection
agreement is purchased, fluctuations in interest rates and in a notional amount
of at least fifty percent (50%) of the outstanding principal amount of the Term
Loans.
7.15 SUBORDINATED NOTES.
The Borrower will prepay or repurchase all the Subordinated Notes on or
before the Subordinated Notes Call Date.
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7.16 FURTHER ASSURANCES REGARDING LANDLORD WAIVERS.
As soon as practicable after the Effective Date and in any event not later
than 60 days after the Closing Date the Credit Parties shall use their
commercially reasonable efforts to cause to be delivered to the Collateral
Agent, in form and substance reasonably satisfactory to the Collateral Agent,
an estoppel letter, consent or waiver from the landlords with respect to the
Other Leasehold Properties set forth on Schedule 7.16, which estoppel letters,
consents or waivers shall, among other things, recognize the Collateral Agent's
first priority security interest in all personal property located on the Other
Leasehold Properties and provide a waiver of such landlord's rights in such
personal property in form and substance reasonably satisfactory to the
Collateral Agent.
7.17 INFORMATION UPDATE.
Each of the Credit Parties hereby agrees that it shall promptly (and in
any event within ten Business Days) update Schedule 6.15, Schedule 6.19 and/or
Schedule 6.22 upon the request of the Administrative Agent or the Required
Lenders; provided, however, each of the Lenders hereby agrees that such update
of Schedule 6.15, Schedule 6.19 and/or Schedule 6.22 shall not be considered an
amendment or change to the Credit Agreement and therefore will not require the
signature of the Required Lenders.
SECTION 8
NEGATIVE COVENANTS
Each Credit Party hereby covenants and agrees that until the Loans and LOC
Obligations, together with interest, fees and other obligations hereunder other
than obligations that expressly survive the termination of this Credit
Agreement, have been paid in full and the Commitments and Letters of Credit
hereunder shall have terminated:
8.1 INDEBTEDNESS.
Neither Holdings, the Borrower nor any of their Subsidiaries will
contract, create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness arising under this Credit Agreement and the other
Credit Documents;
(b) Indebtedness existing as of the Closing Date as referenced in
Section 6.9 (and renewals, refinancings, replacements or extensions
thereof on terms and conditions no more favorable, in the aggregate, to
such Person than such existing Indebtedness and in a principal amount not
in excess of that outstanding as of the date of such renewal,
refinancing, replacement or extension);
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(c) Indebtedness in respect of current accounts payable and accrued
expenses incurred in the ordinary course of business and to the extent
not current, accounts payable and accrued expenses that are subject to
bona fide dispute;
(d) Indebtedness owing by (i) one Credit Party to another Credit
Party, (ii) a Foreign Subsidiary to another Foreign Subsidiary, (iii) a
Credit Party to a Foreign Subsidiary and (iv) a Foreign Subsidiary to a
Credit Party provided such Indebtedness is a Permitted Investment;
(e) Indebtedness with respect to Capital Leases and purchase money
Indebtedness, provided that (i) the total of all such Indebtedness shall
not exceed $5,000,000, in the aggregate, at any one time, (ii) such
Indebtedness when incurred shall not exceed the purchase price of the
asset(s) financed and (iii) no such Indebtedness shall be refinanced for
a principal amount in excess of the principal balance outstanding thereon
at the time of such refinancing;
(f) Indebtedness in connection with a permitted Receivables
Transaction;
(g) Indebtedness evidenced by the interest rate protection
agreements referred to in Section 7.14 or any other Hedging Agreement
entered into in the ordinary course of business and not for speculative
purposes;
(h) Indebtedness existing with respect to real property or any
industrial revenue bond financing of a corporation which becomes a
Subsidiary of the Borrower or is merged with or into a Credit Party after
the date hereof; provided that (A) such Indebtedness existed at the time
such corporation became a Subsidiary of the Borrower or was merged with
or into a Credit Party, (B) such Indebtedness was not incurred in
anticipation thereof, (C) at such time no Default or Event of Default
exists or shall result from such transaction and (D) such Indebtedness is
more favorable than available under this Credit Agreement;
(i) Indebtedness with respect to the Xxxxxx Property not to exceed
$9,000,000;
(j) Indebtedness incurred by Foreign Subsidiaries (in addition to
such Indebtedness permitted by Section 8.1(d) above) not to exceed
$30,000,000, in the aggregate, at any one time; and
(k) other unsecured Indebtedness (in addition to Indebtedness
otherwise permitted under this Section 8.1) which does not exceed
$5,000,000, in the aggregate, at any one time.
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8.2 LIENS.
Neither Holdings, the Borrower nor any of their Subsidiaries will
contract, create, incur, assume or permit to exist any Lien with respect to any
of its property or assets of any kind (whether real or personal, tangible or
intangible), whether now owned or after acquired, except for Permitted Liens.
8.3 NATURE OF BUSINESS.
Neither Holdings, the Borrower nor any of their Subsidiaries will alter
the character of its business from that conducted as of the Effective Date or
engage in any business other than the business conducted as of the Effective
Date and activities which are substantially similar or related thereto.
8.4 CONSOLIDATION AND MERGER.
Neither Holdings, the Borrower nor any of their Subsidiaries will enter
into any transaction of merger or consolidation or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution); provided that
notwithstanding the foregoing provisions of this Section 8.4, the following
actions may be taken if after giving effect thereto no Default or Event of
Default exists and provided that other actions are taken as reasonably
necessary to ensure that the Lenders have a Lien on all Collateral subject only
to Permitted Liens:
(a) any Credit Party other than Holdings may be merged or
consolidated with or into the Borrower or any other Credit Party;
provided that if such transaction shall be between the Borrower and
another Credit Party, the Borrower shall be the continuing or surviving
corporation;
(b) any Credit Party other than Holdings may merge or consolidate
with any other Person (other than another Credit Party) if such Credit
Party shall be the continuing or surviving corporation or such other
Person may be the surviving corporation if such other Person becomes a
Credit Party hereunder in accordance with the terms of this Credit
Agreement upon consummation of such merger and takes such other action as
required by the Collateral Agent; provided, however, notwithstanding the
foregoing, if the Borrower is involved in such merger or consolidation
with any other Person, the Borrower shall be the surviving corporation;
and
(c) any Foreign Subsidiary may merge or consolidate with any other
Foreign Subsidiary.
8.5 SALE OR LEASE OF ASSETS.
Unless the Net Cash Proceeds are forwarded to the Administrative Agent as
set forth in Section 3.3(b)(iii), neither Holdings, the Borrower nor any of
their Subsidiaries will convey, sell, lease, transfer or otherwise dispose of,
in one transaction or a series of transactions, all or any
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part of its business or assets whether now owned or hereafter acquired,
including, without limitation, inventory, receivables, leasehold interests, and
securities but excluding (i) any inventory or other assets sold, leased or
disposed of (or simultaneously replaced with like goods) in the ordinary course
of business, (ii) obsolete, idle or worn-out assets no longer used or useful in
its business, (iii) subject to Section 8.4, the sale, lease or transfer or
other disposal by a Credit Party of any or all of its assets or the capital
stock of any other Credit Party to the Borrower, another Credit Party or other
Person provided such Person promptly becomes a Credit Party in accordance with
the terms of Section 7.13, (iv) permitted Receivables Transactions, if
consideration paid by third parties does not exceed, in the aggregate,
$50,000,000, and all proceeds from same are paid to the Lenders as set forth in
Section 3.3(b)(iv), (v) license agreements entered, as licensor, in the
ordinary course of business for use of intellectual property or other
intangible assets of any Credit Party or any of their Subsidiaries, (vi)
transfers constituting Permitted Investments, (vii) other sales of assets of
the Credit Parties or any of their Subsidiaries not to exceed $1,000,000, in
the aggregate, during any fiscal year of the Borrower and (viii) other sales of
assets of the Foreign Subsidiaries; provided that the Borrower complies with
the terms of Section 3.3(b)(iii).
8.6 SALE LEASEBACKS.
Except with the consent of the Required Lenders, none of the Credit
Parties will, nor will it permit any of its Subsidiaries to, directly or
indirectly become or remain liable as lessee or as guarantor or other surety
with respect to any lease, whether an operating lease or a capital lease, of
any property (whether real or personal or mixed), whether now owned or
hereafter acquired, (a) which such Credit Party or Subsidiary has sold or
transferred or is to sell or transfer to any other Person other than a Credit
Party or (b) which such Credit Party or Subsidiary intends to use for
substantially the same purpose as any other property which has been sold or is
to be sold or transferred by such Credit Party or Subsidiary to any Person
other than a Credit Party in connection with such lease.
8.7 ADVANCES, INVESTMENTS AND LOANS.
Neither Holdings, the Borrower nor any of their Subsidiaries will make any
investments except for Permitted Investments.
8.8 RESTRICTED PAYMENTS.
Neither Holdings, the Borrower nor any of their Subsidiaries will,
directly or indirectly, (a) declare or pay any dividends (whether cash or
otherwise) or make any other distribution upon any shares of its capital stock
of any class or (b) purchase, redeem or otherwise acquire or retire or make any
provisions for redemption, acquisition or retirement of any shares of its
capital stock of any class or any warrants or options to purchase any such
shares other than a Permitted Investment; provided that (i) if no Default or
Event of Default exists and is continuing, the Borrower may pay dividends to
Holdings, (A) for administration expenses up to $1,000,000 per year, (B) to
allow for the repurchase of stock or options of Holdings that constitutes a
Permitted Investment, (C) to allow for the payment of taxes in accordance with
that certain Tax Allocation
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Agreement dated as of December 17, 1992 among Ivex Packaging Corporation f/k/a
Ivex Holdings Corporation and its Subsidiaries, (D) subsequent to September 14,
2000, to pay interest on the Holdings Debentures, and (E) to allow for the
redemption by Holdings of the Holdings Debentures, (ii) (A) Subsidiaries of the
Borrower may pay dividends to the Borrower or to another Credit Party that is a
Subsidiary of the Borrower and (B) Foreign Subsidiaries may pay dividends to
another Foreign Subsidiary.
8.9 TRANSACTIONS WITH AFFILIATES.
Except as set forth on Schedule 8.9, neither Holdings, the Borrower nor
any of their Subsidiaries will enter into any transaction or series of
transactions, whether or not in the ordinary course of business, with any
officer, director, shareholder, or Affiliate (other than a Subsidiary of
Holdings) other than on terms and conditions substantially as favorable as
would be obtainable in a comparable arm's-length transaction with a Person
other than an officer, director, shareholder, Subsidiary or Affiliate.
8.10 OWNERSHIP OF BORROWER.
Holdings will not sell, transfer or otherwise dispose of any shares of
capital stock of the Borrower. Furthermore, Holdings will not hold any assets
other than (a) the stock of the Borrower, (b) such amounts allowed to be
transferred to Holdings pursuant to Section 8.8 and (c) net proceeds from an
equity offering by Holdings for a period not to exceed 90 days. Holdings may
not have any liabilities other than the liabilities under the Credit Documents,
the Holdings Debentures and tax liabilities and other liabilities in the
ordinary course of business.
8.11 FISCAL YEAR; ORGANIZATIONAL DOCUMENTS.
Neither Holdings, the Borrower nor any of their Subsidiaries will (a)
change its fiscal year without the prior written consent of the Required
Lenders or (b) in any manner that would reasonably be likely to adversely
affect the rights of the Lenders, change its articles or certificate of
incorporation or its bylaws.
8.12 SUBORDINATED DEBT.
Neither Holdings nor the Borrower will amend, modify or waive any of the
terms and conditions of the Holdings Debentures or the Subordinated Notes, as
applicable, in a manner that would adversely affect the Lenders, or their
rights under the Credit Documents, without the prior written consent of the
Required Lenders; provided that any amendment to the terms and conditions of
the Subordinated Debt solely to allow for the redemption or other acquisition
of Holdings Debentures or Subordinated Notes in accordance with the terms
hereof shall not be deemed to adversely affect the Lenders.
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8.13 NO LIMITATIONS.
No Credit Party will, nor will it permit its Subsidiaries to, directly or
indirectly, create or otherwise cause, incur, assume, suffer or permit to exist
or become effective any consensual encumbrance or restriction of any kind on
the ability of any such Person to (a) pay dividends or make any other
distribution on any of such Person's capital stock, (b) pay any Indebtedness
owed to the Borrower or any other Credit Party, (c) make loans or advances to
any other Credit Party or (d) transfer any of its property to any other Credit
Party, except for encumbrances or restrictions existing under or by reason of
(i) customary non-assignment or net worth provisions in any lease governing a
leasehold interest, license or other contract, (ii) any agreement or other
instrument of a Person existing at the time it becomes a Subsidiary of the
Borrower; provided that such encumbrance or restriction is not applicable to
any other Person, or any property of any other Person, other than such Person
becoming a Subsidiary of the Borrower and was not entered into in contemplation
of such Person becoming a Subsidiary of the Borrower, (iii) this Credit
Agreement and the other Credit Documents, (iv) any agreement of a Credit Party
or any of its Subsidiaries in effect as of the Closing Date governing
Indebtedness of a Credit Party or any of its Subsidiaries outstanding as of the
Closing Date and, if such Indebtedness is renewed, extended or refinanced in
accordance with the terms of this Credit Agreement, such other restrictions in
the agreements governing the renewed, extended or refinanced Indebtedness (and
successive renewals, extensions and refinancings thereof in accordance with the
terms of this Credit Agreement) provided such restrictions are no more
restrictive in any material respect than those contained in the agreements
governing such outstanding Indebtedness being renewed, extended or refinanced,
(v) any agreement governing Indebtedness permitted by Section 8.1(f), (g) and
(k) provided such restrictions are no more restrictive in any material respect
than those contained in the Credit Documents, (vi) any agreement governing
Indebtedness permitted by Section 8.1(h), (vii) any agreement of a Foreign
Subsidiary governing Indebtedness permitted by Section 8.1(j), (viii) any
agreement establishing Permitted Liens with respect to those assets subject to
such Permitted Liens and (ix) any agreement of a foreign joint venture in
effect at such time such foreign joint venture becomes a Subsidiary of a Credit
Party.
8.14 NEGATIVE PLEDGES.
Except as set forth in the Credit Documents and in any agreements
governing Indebtedness permitted by Schedule 8.1(b), a Credit Party will not,
nor will it permit any of its Domestic Subsidiaries to, enter into, assume or
become subject to any agreement prohibiting or otherwise restricting the
creation or assumption of any Lien upon its properties or assets, whether now
owned or hereafter acquired, or requiring the grant of any security for such
obligation if security is given for some other obligation; except for any
prohibition or restriction existing under or by reason of (i) Indebtedness
permitted by Schedule 8.1(b), (ii) customary non-assignment provisions in
leases, licenses and other contracts, (iii) restrictions in agreements
establishing Permitted Liens with respect to the assets subject to such
Permitted Liens, (iv) any agreement governing Indebtedness permitted by Section
8.1(f), (g) and (k) provided such restrictions are no more restrictive in any
material respect than those contained in the Credit Documents and (v) any
agreement of a Foreign Subsidiary governing Indebtedness permitted by Section
8.1(j).
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8.15 LIMITATION ON FOREIGN OPERATIONS.
The Credit Parties will not, nor will they permit any of their
Subsidiaries to, allow the Foreign Subsidiaries to have assets which in the
aggregate constitute more than 30% of Total Assets at any time.
8.16 MARGIN REGULATIONS.
The Credit Parties will not, nor will they permit any of their
Subsidiaries to, use any of the proceeds of the Loans to purchase or carry any
Margin Stock in violation of Regulation U, Regulation X or Regulation G. The
Credit Parties will not, nor will they permit any of their Subsidiaries to, own
any Margin Stock to the extent the value of all Margin Stock of Holdings and
its Subsidiaries (on a consolidated and unconsolidated basis) would equal or
exceed 25% of the value (as determined by any reasonable method) of the assets
of Holdings and its Subsidiaries (on a consolidated and unconsolidated basis).
SECTION 9
EVENTS OF DEFAULT
9.1 EVENTS OF DEFAULT.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Payment. Any Credit Party shall:
(i) default in the payment when due of any principal of any of
the Loans or of any reimbursement obligation arising from drawings
under Letters of Credit; or
(ii) default, and such default shall continue for three or
more days, in the payment when due of any interest on the Loans, or
of any fees or other amounts owing hereunder, under any of the
other Credit Documents or in connection herewith.
(b) Representations. Any representation, warranty or statement made
or deemed to be made by any Credit Party herein, in any of the other
Credit Documents, or in any statement or certificate delivered or
required to be delivered pursuant hereto or thereto shall prove untrue in
any material respect on the date as of which it was deemed to have been
made.
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(c) Covenants. Any Credit Party shall:
(i) default in the due performance or observance of any term,
covenant or agreement contained in Sections 7.2, 7.3, 7.5, 7.11,
7.15, 7.17 or 8.1 through 8.16 inclusive; or
(ii) default in the due performance or observance by it of any
term, covenant or agreement contained in Section 7.1 and such
default shall continue unremedied for a period of five Business
Days after the earlier of an officer of Credit Party becoming aware
of such default or notice thereof is given by the Administrative
Agent; or
(iii) default in the due performance or observance by it of
any term, covenant or agreement (other than those referred to in
subsections (a), (b) or (c)(i) or (ii) of this Section 9.1)
contained in this Credit Agreement and such default shall continue
unremedied for a period of at least 30 days after the earlier of an
officer of a Credit Party becoming aware of such default or notice
thereof given by the Administrative Agent.
(d) Other Credit Documents. (i) Any Credit Party shall default in
the due performance or observance of any term, covenant or agreement in
any of the other Credit Documents and such default shall continue
unremedied for a period of at least 30 days after the earlier of an
officer of a Credit Party becoming aware of such default or notice
thereof given by the Administrative Agent, or (ii) any Credit Document
shall fail to be in full force and effect or any Credit Document shall
fail to give the Agents and/or the Lenders the security interests, liens,
rights, powers and privileges purported to be created thereby or any
Credit Party or any Person acting by or on behalf of any Credit Party
shall deny or disaffirm its obligations under the Credit Documents.
(e) Guaranties. The guaranty given by the Credit Parties hereunder
or by any Additional Credit Party hereafter or any provision thereof
shall cease to be in full force and effect, or any guarantor thereunder
or any Person acting by or on behalf of such guarantor shall deny or
disaffirm such Guarantor's obligations under such guaranty.
(f) Bankruptcy, etc. The occurrence of any of the following with
respect to a Credit Party or any of its Subsidiaries (other than
Insignificant Subsidiaries) (each a "Bankruptcy Event"): (i) a court or
governmental agency having jurisdiction in the premises shall enter a
decree or order for relief in respect of a Credit Party or any of its
Subsidiaries (other than Insignificant Subsidiaries) in an involuntary
case under any applicable bankruptcy, insolvency or other similar law now
or hereafter in effect, or appoint a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of a Credit Party or
any of its Subsidiaries (other than Insignificant Subsidiaries) or for
any substantial part of its property or ordering the winding up or
liquidation of its affairs; or (ii) an involuntary case under any
applicable bankruptcy, insolvency or other similar
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law now or hereafter in effect is commenced against a Credit Party or any
of its Subsidiaries (other than Insignificant Subsidiaries) and such
petition remains unstayed and in effect for a period of 60 consecutive
days; or (iii) a Credit Party or any of its Subsidiaries (other than
Insignificant Subsidiaries) shall commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter
in effect, or consent to the entry of an order for relief in an
involuntary case under any such law, or consent to the appointment or
taking possession by a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official of such Person or any
substantial part of its property or make any general assignment for the
benefit of creditors; or (iv) a Credit Party or any of its Subsidiaries
(other than Insignificant Subsidiaries) shall admit in writing its
inability to pay its debts generally as they become due or is not
generally paying its debts as they become due; or (v) a Credit Party or
any of its Subsidiaries (other than Insignificant Subsidiaries) shall
take any action in furtherance of any of the aforesaid purposes.
(g) Defaults under Other Agreements. With respect to any
Indebtedness (other than Indebtedness outstanding under this Credit
Agreement) of a Credit Party or any of its Subsidiaries in a principal
amount in excess of $5,000,000, including, without limitation, the
Subordinated Debt (i) a Credit Party or any of its Subsidiaries shall (A)
default in any payment (beyond the applicable grace period with respect
thereto, if any) with respect to any such Indebtedness, or (B) default
(after giving effect to any applicable grace period) in the observance or
performance relating to such Indebtedness or contained in any instrument
or agreement evidencing, securing or relating thereto, or any other event
or condition shall occur or condition exist, the effect of which default
or other event or condition is to cause, or permit, the holder or holders
of such Indebtedness (or trustee or agent on behalf of such holders) to
cause (determined without regard to whether any notice or lapse of time
is required) any such Indebtedness to become due prior to its stated
maturity; or (ii) any such Indebtedness shall be declared due and
payable, or required to be prepaid other than by a regularly scheduled
required prepayment prior to the stated maturity thereof; or (iii) any
such Indebtedness shall mature and remain unpaid.
(h) Judgments. One or more judgments, orders, or decrees shall be
entered against a Credit Party or any of its Subsidiaries involving a
liability of $2,500,000 or more, in the aggregate, (to the extent not
paid or covered by insurance provided by a carrier who has acknowledged
coverage) and such judgments, orders or decrees (i) are the subject of
any enforcement proceeding commenced by any creditor or (ii) shall
continue unsatisfied, undischarged and unstayed for a period ending on
the first to occur of (A) the last day on which such judgment, order or
decree becomes final and unappealable or (B) 60 days.
(i) ERISA. The occurrence of any of the following events or
conditions which in the aggregate would have a Material Adverse Effect:
(A) any "accumulated funding deficiency," as such term is defined in
Section 302 of ERISA and Section 412 of the Code, whether or not waived,
shall exist with respect to any Plan, or any lien shall arise on the
assets of a Credit Party or any of its Subsidiaries or any ERISA
Affiliate in
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favor of the PBGC or a Plan; (B) a Termination Event shall occur with
respect to a Single Employer Plan, which is, in the reasonable opinion of
the Administrative Agent, likely to result in the termination of such
Plan for purposes of Title IV of ERISA; (C) a Termination Event shall
occur with respect to a Multiemployer Plan or Multiple Employer Plan,
which is, in the reasonable opinion of the Administrative Agent, likely
to result in (i) the termination of such Plan for purposes of Title IV of
ERISA, or (ii) a Credit Party or any of its Subsidiaries or any ERISA
Affiliate incurring any liability in connection with a withdrawal from,
reorganization of (within the meaning of Section 4241 of ERISA), or
insolvency (within the meaning of Section 4245 of ERISA) of such Plan; or
(D) any prohibited transaction (within the meaning of Section 406 of
ERISA or Section 4975 of the Code) or breach of fiduciary responsibility
shall occur which may subject a Credit Party or any of its Subsidiaries
or any ERISA Affiliate to any liability under Sections 406, 409, 502(i),
or 502(l) of ERISA or Section 4975 of the Code, or under any agreement or
other instrument pursuant to which a Credit Party or any of its
Subsidiaries or any ERISA Affiliate has agreed or is required to
indemnify any person against any such liability.
(j) Ownership. There shall occur a Change of Control.
(k) Subordinated Debt. The holders of the Subordinated Notes or the
holders of the Holdings Debentures assert in a legal proceeding (or any
Governmental Authority with applicable jurisdiction determines) that the
Lenders are not either (i) holders of Senior Indebtedness (as defined in
the Subordinated Notes) or (ii) holders of Senior Obligations (as defined
in the Holdings Debentures), as applicable.
9.2 ACCELERATION; REMEDIES.
Upon the occurrence of an Event of Default, and at any time thereafter
unless and until such Event of Default has been waived in writing by the
Required Lenders (or the Lenders as may be required hereunder) or cured to the
satisfaction of the Required Lenders (or the Lenders as may be required
hereunder), the Administrative Agent shall, upon the request and direction of
the Required Lenders, by written notice to the Borrower, take any of the
following actions without prejudice to the rights of the Administrative Agent
or any Lender to enforce its claims against the Credit Parties, except as
otherwise specifically provided for herein:
(a) Termination of Commitments. Declare the Commitments terminated
whereupon the Commitments shall be immediately terminated.
(b) Acceleration of Loans. Declare the unpaid principal of and any
accrued interest in respect of all Loans, any reimbursement obligations
arising from drawings under Letters of Credit and any and all other
indebtedness or obligations of any and every kind owing by a Credit Party
to any of the Lenders hereunder to be due whereupon the same shall be
immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Credit Parties.
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(c) Cash Collateral. Direct the Borrower to pay (and the Borrower
agrees that upon receipt of such notice, or upon the occurrence of an
Event of Default under Section 9.1(f), they will immediately pay) to the
Administrative Agent additional cash, to be held by the Administrative
Agent, for the benefit of the applicable Lenders, in a cash collateral
account as additional security for the LOC Obligations in respect of
subsequent drawings under all then outstanding Letters of Credit in an
amount equal to the maximum aggregate amount which may be drawn under all
Letters of Credits then outstanding.
(d) Enforcement of Rights. Enforce any and all rights and interests
created and existing under the Credit Documents, including, without
limitation, all rights and remedies existing under the Collateral
Documents, all rights and remedies against a Guarantor and all rights of
set-off.
Notwithstanding the foregoing, if an Event of Default specified in Section
9.1(f) shall occur, then the Commitments shall automatically terminate and all
Loans, all reimbursement obligations under Letters of Credit, all accrued
interest in respect thereof, all accrued and unpaid fees and other indebtedness
or obligations owing to the Lenders hereunder shall immediately become due and
payable without the giving of any notice or other action by the Agents or the
Lenders, which notice or other action is expressly waived by the Credit
Parties.
Notwithstanding the fact that enforcement powers reside primarily with the
Administrative Agent, each Lender has, to the extent permitted by law, a
separate right of payment and shall be considered a separate "creditor" holding
a separate "claim" within the meaning of Section 101(5) of the Bankruptcy Code
or any other insolvency statute.
9.3 ALLOCATION OF PAYMENTS AFTER EVENT OF DEFAULT.
Notwithstanding any other provisions of this Credit Agreement, after the
occurrence and during the continuance of an Event of Default, all amounts
collected or received by an Agent or any Lender on account of amounts
outstanding under any of the Credit Documents or in respect of the Collateral
shall be paid over or delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket costs and
expenses (including without limitation reasonable attorneys' fees) of the
Agents in connection with enforcing the rights of the Lenders under the
Credit Documents and any protective advances made by the Agents with
respect to the Collateral under or pursuant to the terms of the
Collateral Documents;
SECOND, to payment of any fees owed to an Agent or an Issuing
Lender;
THIRD, to the payment of all reasonable out-of-pocket costs and
expenses, (including, without limitation, reasonable attorneys' fees) of
each of the Lenders in connection with enforcing its rights under the
Credit Documents;
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FOURTH, to the payment of all accrued fees and interest payable to
the Lenders hereunder;
FIFTH, to the payment of the outstanding principal amount of the
Loans and unreimbursed drawings under Letters of Credit, to the payment
or cash collateralization of the outstanding LOC Obligations and to any
principal amounts outstanding under Hedging Agreements, pro rata as set
forth below;
SIXTH, to all other obligations which shall have become due and
payable under the Credit Documents and not repaid pursuant to clauses
"FIRST" through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whoever may be
lawfully entitled to receive such surplus.
In carrying out the foregoing, (a) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; (b) each of the Lenders shall receive an amount equal to
its pro rata share (based on the proportion that the then outstanding Loans,
LOC Obligations and obligations under Hedging Agreements held by such Lender
bears to the aggregate then outstanding Loans, LOC Obligations and obligations
under Hedging Agreements) of amounts available to be applied pursuant to
clauses "THIRD", "FOURTH," "FIFTH" and "SIXTH" above; and (c) to the extent
that any amounts available for distribution pursuant to clause "FIFTH" above
are attributable to the issued but undrawn amount of outstanding Letters of
Credit, such amounts shall be held by the Collateral Agent in a cash collateral
account and applied (x) first, to reimburse the Issuing Lenders from time to
time for any drawings under such Letters of Credit and (y) then, following the
expiration of all Letters of Credit, to all other obligations of the types
described in clauses "FIFTH" and "SIXTH" above in the manner provided in this
Section 9.3.
SECTION 10
AGENCY PROVISIONS
10.1 APPOINTMENT.
Each Lender hereby designates and appoints NationsBank, N.A. as
Administrative Agent and Collateral Agent and Bankers Trust Company as
Documentation Agent of such Lender to act as specified herein and the other
Credit Documents, and each such Lender hereby authorizes the Agents, as the
agents for such Lender, to take such action on its behalf under the provisions
of this Credit Agreement and the other Credit Documents and to exercise such
powers and perform such duties as are expressly delegated by the terms and of
the other Credit Documents, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere
herein and in the other Credit Documents, the Agents shall not have any duties
or responsibilities, except those expressly set forth herein and therein, or
any fiduciary
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relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Credit Agreement or any of the other Credit Documents, or shall otherwise
exist against the Agents. The provisions of this Section are solely for the
benefit of the Agents and the Lenders and none of the Credit Parties shall have
any rights as a third party beneficiary of the provisions. In performing its
functions and duties under this Credit Agreement and the other Credit
Documents, each Agent shall act solely as an agent of the Lenders and does not
assume and shall not be deemed to have assumed any obligation or relationship
of agency or trust with or for any Credit Party.
10.2 DELEGATION OF DUTIES.
An Agent may execute any of its duties hereunder or under the other Credit
Documents by or through agents or attorneys-in-fact and shall be entitled to
advice of counsel concerning all matters pertaining to such duties. An Agent
shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.
10.3 EXCULPATORY PROVISIONS.
Neither the Agents nor any of their officers, directors, employees,
agents, attorneys-in-fact or affiliates shall be liable for any action
lawfully taken or omitted to be taken by it or such Person under or in
connection herewith or in connection with any of the other Credit Documents
(except for its or such Person's own gross negligence or willful misconduct) or
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by any of the Credit Parties contained
herein or in any of the other Credit Documents or in any certificate, report,
document, financial statement or other written or oral statement referred to or
provided for in, or received by an Agent under or in connection herewith or in
connection with the other Credit Documents, or enforceability or sufficiency
therefor of any of the other Credit Documents, or for any failure of the
Borrower to perform its obligations hereunder or thereunder. The Agents shall
not be responsible to any Lender for the effectiveness, genuineness, validity,
enforceability, collectibility or sufficiency of this Credit Agreement, or any
of the other Credit Documents or for any representations, warranties, recitals
or statements made herein or therein or made by the Borrower or any Credit
Party in any written or oral statement or in any financial or other statements,
instruments, reports, certificates or any other documents in connection
herewith or therewith furnished or made by an Agent to the Lenders or by or on
behalf of the Credit Parties to the Agents or any Lender or be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or
as to the use of the proceeds of the Loans or the use of the Letters of Credit
or of the existence or possible existence of any Default or Event of Default or
to inspect the properties, books or records of the Credit Parties. The Agents
are not trustees for the Lenders and owe no fiduciary duty to the Lenders.
10.4 RELIANCE ON COMMUNICATIONS.
The Agents shall be entitled to rely, and shall be fully protected in
relying, upon any note, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy,
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telex or teletype message, statement, order or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to any of the Credit Parties,
independent accountants and other experts selected by the Agents with
reasonable care). The Agents may deem and treat the Lenders as the owner of
its interests hereunder for all purposes unless a written notice of assignment,
negotiation or transfer thereof shall have been filed with the Administrative
Agent in accordance with Section 11.3(b). The Agents shall be fully justified
in failing or refusing to take any action under this Credit Agreement or under
any of the other Credit Documents unless it shall first receive such advice or
concurrence of the Required Lenders as it deems appropriate or it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action. The Agents shall in all cases be fully protected in
acting, or in refraining from acting, hereunder or under any of the other
Credit Documents in accordance with a request of the Required Lenders (or to
the extent specifically provided in Section 11.6, all the Lenders) and such
request and any action taken or failure to act pursuant thereto shall be
binding upon all the Lenders (including their successors and assigns).
10.5 NOTICE OF DEFAULT.
An Agent shall not be deemed to have knowledge or notice of the occurrence
of any Default or Event of Default hereunder unless such Agent has received
notice from a Lender or a Credit Party referring to the Credit Document,
describing such Default or Event of Default and stating that such notice is a
"notice of default." In the event that the Administrative Agent receives such a
notice, the Administrative Agent shall give prompt notice thereof to the
Lenders. The Administrative Agent shall take such action with respect to such
Default or Event of Default as shall be reasonably directed by the Required
Lenders.
Subsequent to an Event of Default and during the continuation thereof, the
Administrative Agent shall, if requested by a Lender, conduct a phase I
environmental audit, and, where necessary, a phase II environmental audit on
any parcel of real estate owned by a Credit Party prior to proceeding with
foreclosing on any real property of a Credit Party or exercising voting rights
or other remedies with respect to any Pledged Shares (as defined in the Pledge
Agreement).
10.6 NON-RELIANCE ON AGENTS AND OTHER LENDERS.
Each Lender expressly acknowledges that neither the Agents nor any of
their officers, directors, employees, agents, attorneys-in-fact or affiliates
has made any representations or warranties to it and that no act by the Agents
or any affiliate thereof hereinafter taken, including any review of the affairs
of any Credit Party, shall be deemed to constitute any representation or
warranty by the Agents to any Lender. Each Lender represents to the Agents
that it has, independently and without reliance upon the Agents or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
assets, operations, property, financial and other conditions, prospects and
creditworthiness of the Credit Parties and made its own decision to make its
Loans
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hereunder and enter into this Credit Agreement. Each Lender also represents
that it will, independently and without reliance upon the Agents or any other
Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit analysis, appraisals
and decisions in taking or not taking action under this Credit Agreement, and
to make such investigation as it deems necessary to inform itself as to the
business, assets, operations, property, financial and other conditions,
prospects and creditworthiness of the Credit Parties. Except for notices,
reports and other documents expressly required to be furnished to the Lenders
by the Administrative Agent hereunder, the Agents shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, operations, assets, property, financial or other
conditions, prospects or creditworthiness of the Credit Parties which may come
into the possession of the Agents or any of their officers, directors,
employees, agents, attorneys-in-fact or affiliates.
10.7 INDEMNIFICATION.
The Lenders agree to indemnify each Agent in its capacity as such (to the
extent not reimbursed by the Borrower and without limiting the obligation of
the Borrower to do so), ratably according to their respective Commitments (or
if the Commitments have expired or been terminated, in accordance with the
respective principal amounts of outstanding Loans and Participation Interest of
the Lenders), from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever which may at any time (including without limitation at
any time following payment in full of the Credit Party Obligations) be imposed
on, incurred by or asserted against an Agent in its capacity as such in any way
relating to or arising out of this Credit Agreement or the other Credit
Documents or any documents contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby or any action taken or omitted
by an Agent under or in connection with any of the foregoing; provided that no
Lender shall be liable for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the gross negligence or willful
misconduct of an Agent. If any indemnity furnished to an Agent for any purpose
shall, in the opinion of such Agent, be insufficient or become impaired, such
Agent may call for additional indemnity and cease, or not commence, to do the
acts indemnified against until such additional indemnity is furnished. The
agreements in this Section shall survive the payment of the Credit Party
Obligations and all other amounts payable hereunder and under the other Credit
Documents.
10.8 AGENTS IN THEIR INDIVIDUAL CAPACITY.
Each Agent and its affiliates may make loans to, accept deposits from and
generally engage in any kind of business with the Borrower or any other Credit
Party as though such Agent were not an Agent hereunder. With respect to the
Loans made and Letters of Credit issued and all obligations owing to it, an
Agent shall have the same rights and powers under this Credit Agreement as any
Lender and may exercise the same as though they were not an Agent, and the
terms "Lender" and "Lenders" shall include each Agent in its individual
capacity.
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10.9 SUCCESSOR AGENT.
Any Agent may, at any time, resign upon 20 days written notice to the
Lenders. Upon any such resignation, the Required Lenders shall have the right
to appoint a successor Agent. If no successor Agent shall have been so
appointed by the Required Lenders, and shall have accepted such appointment,
within 45 days after the notice of resignation, then the retiring Agent shall
select a successor Agent provided such successor is a Lender hereunder or
qualifies as an Eligible Assignee. Upon the acceptance of any appointment as
an Agent hereunder by a successor, such successor Agent shall thereupon succeed
to and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations as an Agent, as appropriate, under this Credit Agreement and the
other Credit Documents and the provisions of this Section 10.9 shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
an Agent under this Credit Agreement.
SECTION 11
MISCELLANEOUS
11.1 NOTICES.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device) to the
number set out below, (c) the Business Day following the day on which the same
has been delivered prepaid to a reputable national overnight air courier
service, or (d) the third Business Day following the day on which the same is
sent by certified or registered mail, postage prepaid, in each case to the
respective parties at the address or telecopy numbers set forth on Schedule
11.1, or at such other address as such party may specify by written notice to
the other parties hereto.
11.2 RIGHT OF SET-OFF.
In addition to any rights now or hereafter granted under applicable law or
otherwise, and not by way of limitation of any such rights, upon the occurrence
of an Event of Default and during the continuation thereof, each Lender is
authorized at any time and from time to time, without presentment, demand,
protest or other notice of any kind (all of which rights being hereby expressly
waived), to set-off and to appropriate and apply any and all deposits (general
or special) and any other indebtedness at any time held or owing by such Lender
(including, without limitation, branches, agencies or Affiliates of such Lender
wherever located) to or for the credit or the account of any Credit Party
against obligations and liabilities of such Credit Party to the Lenders
hereunder, under the Notes, the other Credit Documents or otherwise,
irrespective of whether the Administrative Agent or the Lenders shall have made
any demand hereunder and although such obligations, liabilities or claims, or
any of them, may be contingent or unmatured, and any such set-off shall be
deemed to have been made immediately upon the occurrence of an
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Event of Default even though such charge is made or entered on the books of
such Lender subsequent thereto. The Credit Parties hereby agree that any
Person purchasing a participation in the Loans and Commitments hereunder
pursuant to Section 11.3(c) or 3.8 may exercise all rights of set-off with
respect to its participation interest as fully as if such Person were a Lender
hereunder.
11.3 BENEFIT OF AGREEMENT.
(a) Generally. This Credit Agreement shall be binding upon and
inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto; provided that none of the Credit
Parties may assign and transfer any of its interests without the prior
written consent of the Lenders; and provided further that the rights of
each Lender to transfer, assign or grant participations in its rights
and/or obligations hereunder shall be limited as set forth in Section
11.3. Notwithstanding the above, nothing herein shall restrict, prevent
or prohibit any Lender from (A) pledging its Loans hereunder to a Federal
Reserve Bank in support of borrowings made by such Lender from such
Federal Reserve Bank, or (B) granting assignments or participations in
such Lender's Loans and/or Commitments hereunder to its parent company
and/or to any Affiliate of such Lender or to any existing Lender or
Affiliate thereof.
(b) Assignments. Each Lender may, with the prior written consent of
the Borrower, the Issuing Lenders (subject to the limitations set forth
below) and the Agents (provided that no consent of the Borrower shall be
required during the existence and continuation of an Event of Default),
which consent shall not be unreasonably withheld or delayed (it being
understood that the Borrower may refuse to consent to an assignment to a
potential competitor of the Borrower), assign all or a portion of its
rights and obligations hereunder pursuant to an assignment agreement
substantially in the form of Exhibit 11.3 to one or more Eligible
Assignees; provided that (i) any such assignment shall be in a minimum
aggregate amount of $5,000,000 of the Commitments and in integral
multiples of $1,000,000 above such amount (or the remaining amount of
Commitments held by such Lender) and (ii) each such assignment shall be
of a constant, not varying, percentage of all of the assigning Lender's
rights and obligations under the Commitment being assigned. Any
assignment hereunder shall be effective upon satisfaction of the
conditions set forth above and delivery to the Administrative Agent of a
duly executed assignment agreement together with a transfer fee of $3,500
payable to the Administrative Agent for its own account. The consent of
an Issuing Lender hereunder shall only be required in connection with an
assignment of all or a portion of the Revolving Committed Amount, and
each Issuing Lender hereby agrees it will consent to any assignee that is
a commercial bank that (A) is rated B/C or better by Xxxxxxxx Bankwatch
and (B) has assets in excess of $1,000,000,000. Upon the effectiveness
of any such assignment, the assignee shall become a "Lender" for all
purposes of this Credit Agreement and the other Credit Documents and, to
the extent of such assignment, the assigning Lender shall be relieved of
its obligations hereunder to the extent of the Loans and Commitment
components being assigned. Along such lines the Borrower agrees that
upon notice of any such assignment and surrender of the appropriate Note
or Notes, it
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will promptly provide to the assigning Lender and to the assignee
separate promissory notes in the amount of their respective interests
substantially in the form of the original Note or Notes (but with
notation thereon that it is given in substitution for and replacement of
the original Note or Notes or any replacement notes thereof).
By executing and delivering an assignment agreement in accordance with
this Section 11.3(b), the assigning Lender thereunder and the assignee
thereunder shall be deemed to confirm to and agree with each other and
the other parties hereto as follows: (i) such assigning Lender warrants
that it is the legal and beneficial owner of the interest being assigned
thereby free and clear of any adverse claim and the assignee warrants
that it is an Eligible Assignee; (ii) except as set forth in clause (i)
above, such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with this Credit Agreement, any
of the other Credit Documents or any other instrument or document
furnished pursuant hereto or thereto, or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this
Credit Agreement, any of the other Credit Documents or any other
instrument or document furnished pursuant hereto or thereto or the
financial condition of any Credit Party or the performance or observance
by any Credit Party of any of its obligations under this Credit
Agreement, any of the other Credit Documents or any other instrument or
document furnished pursuant hereto or thereto; (iii) such assignee
represents and warrants that it is legally authorized to enter into such
assignment agreement; (iv) such assignee confirms that it has received a
copy of this Credit Agreement, the other Credit Documents and such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such assignment agreement; (v)
such assignee will independently and without reliance upon the Agents,
such assigning Lender or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Credit Agreement and the other Credit Documents; (vi) such assignee
appoints and authorizes the Agents to take such action on its behalf and
to exercise such powers under this Credit Agreement or any other Credit
Document as are delegated to the Agents by the terms or thereof,
together with such powers as are reasonably incidental thereto; and (vii)
such assignee agrees that it will perform in accordance with their terms
all the obligations which by the terms of this Credit Agreement and the
other Credit Documents are required to be performed by it as a Lender.
(c) Participations. Each Lender may sell, transfer, grant or assign
participations in all or any part of such Lender's interests and
obligations hereunder; provided that (i) such selling Lender shall remain
a "Lender" for all purposes under this Credit Agreement (such selling
Lender's obligations under the Credit Documents remaining unchanged) and
the participant shall not constitute a Lender hereunder, (ii) no such
participant shall have, or be granted, rights to approve any amendment or
waiver relating to this Credit Agreement or the other Credit Documents
except to the extent any such amendment or waiver would (A) reduce the
principal of or rate of interest on or fees in respect of any Loans in
which the participant is participating or increase any
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Commitments with respect thereto, (B) postpone the date fixed for any
payment of principal (including the extension of the final maturity of
any Loan or the date of any mandatory prepayment), interest or fees in
which the participant is participating, or (C) release all or
substantially all of the collateral or guaranties (except as expressly
provided in the Credit Documents) supporting any of the Loans or
Commitments in which the participant is participating, (iii)
sub-participations by the participant (except to an Affiliate, parent
company or Affiliate of a parent company of the participant) shall be
prohibited and (iv) any such participations shall be in a minimum
aggregate amount of $5,000,000 of the Commitments and in integral
multiples of $1,000,000 in excess thereof. In the case of any such
participation, the participant shall not have any rights under this
Credit Agreement or the other Credit Documents (the participant's rights
against the selling Lender in respect of such participation to be those
set forth in the participation agreement with such Lender creating such
participation) and all amounts payable by the Borrower hereunder shall be
determined as if such Lender had not sold such participation; provided,
however, that such participant shall be entitled to receive additional
amounts under Sections 3.9, 3.12, 3.13 and 3.14 to the same extent that
the Lender from which such participant acquired its participation would
be entitled to the benefit of such cost protection provisions; provided
that any participant seeking reimbursement under Sections 3.9, 3.12, 3.13
or 3.14 shall comply with the obligations imposed on a Lender by each
such Section.
(d) Registration. The Administrative Agent, acting for this purpose
solely on behalf of the Borrower, shall maintain a register (the
"Register") for the recordation of the names and addresses of the Lenders
and the principal amount of the Loans owing to each Lender from time to
time. The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, the Agents and the Lenders shall treat
each Person whose name is recorded in the Register as the owner of a Loan
or other obligation hereunder for all purposes of this Credit Agreement
and the other Credit Documents, notwithstanding notice to the contrary.
Any assignment of any Loan or other obligation hereunder shall be
effective only upon appropriate entries with respect thereto being made
in the Register. The Register shall be available for inspection by the
Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
11.4 NO WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of an Agent or any Lender in exercising
any right, power or privilege hereunder or under any other Credit Document and
no course of dealing between the Borrower or any Credit Party and the Agents or
any Lender shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, power or privilege hereunder or under any other Credit
Document preclude any other or further exercise thereof or the exercise of any
other right, power or privilege hereunder or thereunder. The rights and
remedies provided herein are cumulative and not exclusive of any rights or
remedies which the Agents or any Lender would otherwise have. No notice to or
demand on any Credit Party in any case shall entitle any Credit Party to any
other or further notice or demand in similar or other circumstances or
constitute a
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waiver of the rights of the Agents or the Lenders to any other or further
action in any circumstances without notice or demand.
11.5 PAYMENT OF EXPENSES; INDEMNIFICATION.
The Credit Parties agree to: (a) pay all reasonable out-of-pocket costs
and expenses of (i) the Administrative Agent and the Issuing Lenders in
connection with (A) the negotiation, preparation, execution and delivery and
administration of this Credit Agreement and the other Credit Documents and the
documents and instruments referred to therein (including, without limitation,
the reasonable fees and expenses of Xxxxx & Xxx Xxxxx, special counsel to the
Administrative Agent, the fees and expenses of counsel for the Administrative
Agent in connection with collateral issues or foreign issues and the fees and
expenses of counsel to an Issuing Lender in connection with amendments to the
Existing Letters of Credit), and (B) any amendment, waiver or consent relating
hereto and thereto including, but not limited to, any such amendments, waivers
or consents resulting from or related to any work-out, renegotiation or
restructure relating to the performance by the Credit Parties under this Credit
Agreement and (ii) the Agents and the Lenders (during the existence of an Event
of Default) in connection with (A) enforcement of the Credit Documents and the
documents and instruments referred to therein, including, without limitation,
in connection with any such enforcement, the reasonable fees and disbursements
of counsel for the Agents and each of the Lenders, and (B) any bankruptcy or
insolvency proceeding of a Credit Party of any of its Subsidiaries and (b)
indemnify each Lender, its officers, directors, employees, representatives and
agents from and hold each of them harmless against any and all losses,
liabilities, claims, damages or expenses incurred by any of them as a result
of, or arising out of, or in any way related to, or by reason of, any
investigation, litigation or other proceeding (whether or not any Lender is a
party thereto) related to (i) the entering into and/or performance of any
Credit Document or the use of proceeds of any Loans (including other extensions
of credit) hereunder or the consummation of any other transactions contemplated
in any Credit Document, including, without limitation, the reasonable fees and
disbursements of counsel incurred in connection with any such investigation,
litigation or other proceeding (but excluding any such losses, liabilities,
claims, damages or expenses to the extent incurred by reason of gross
negligence or willful misconduct on the part of the Person to be indemnified),
(ii) any Environmental Claim and (iii) any claims for Non-Excluded Taxes.
11.6 AMENDMENTS, WAIVERS AND CONSENTS.
Neither this Credit Agreement nor any other Credit Document nor any of
the terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is
in writing and signed by the Required Lenders; provided that no such amendment,
change, waiver, discharge or termination shall without the consent of each
Lender affected thereby:
(a) extend the scheduled maturities (including the final maturity)
of any Loan or extend or waive any Principal Amortization Payment of any
Loan or any portion thereof;
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(b) reduce the rate or extend the time of payment of interest (other
than as a result of waiving the applicability of any post-default
increase in interest rates) thereon or fees hereunder;
(c) reduce or waive the principal amount of any Loan;
(d) increase or extend the Commitment of a Lender over the amount
thereof in effect (it being understood and agreed that a waiver of any
Default or Event of Default or a waiver of any mandatory reduction in the
Commitments shall not constitute a change in the terms of any Commitment
of any Lender); provided that the Tranche B Term Loan Committed Amount
may be increased in accordance with Section 2.4.
(e) release all or substantially all of the Collateral securing the
Credit Party Obligations hereunder (provided that the Collateral Agent
may, without consent from any other Lender, release any Collateral that
is sold or transferred by a Credit Party in conformance with Section
8.5);
(f) release the Borrower from its obligations or release all or
substantially all of the other Credit Parties from their respective
obligations under the Credit Documents;
(g) amend, modify or waive any provision of this Section or Section
3.4(a), 3.4(b)(i), 3.6, 3.7, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14, 5.2,
9.1(a), 11.2, 11.3 or 11.5;
(h) reduce any percentage specified in, or otherwise modify, the
definition of Required Lenders; or
(i) consent to the assignment or transfer by the Borrower (or
another Credit Party) of any of its rights and obligations under (or in
respect of) the Credit Documents.
Any amendment to Section 3.3(b) or any of the defined terms contained in such
Section 3.3(b) shall be effective upon the written consent of the Required
Lenders.
No amendment or change that affects the allocation of payments between the
Tranche A Term Loans and Tranche B Loans shall be effective unless Lenders
holding in the aggregate at least 51% of the outstanding Tranche A Terms Loans
and at least 51% of the Tranche B Term Loans shall consent to such amendment or
change in allocation of payments.
Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote
as such Lender sees fit on any reorganization plan that affects the Loans or
the Letters of Credit, and each Lender acknowledges that the provisions of
Section 1126(c) of the Bankruptcy Code supersedes the unanimous consent
provisions set forth herein and (y) the Required Lenders may consent to allow a
Credit Party to use cash collateral in the context of a bankruptcy or
insolvency proceeding.
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11.7 COUNTERPARTS/TELECOPY.
This Credit Agreement may be executed in any number of counterparts, each
of which where so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. Delivery of executed
counterparts by telecopy shall be as effective as an original and shall
constitute a representation that an original will be delivered.
11.8 HEADINGS.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.
11.9 DEFAULTING LENDER.
Each Lender understands and agrees that if such Lender is a Defaulting
Lender then notwithstanding the provisions of Section 11.6 it shall not be
entitled to vote on any matter requiring the consent of the Required Lenders or
to object to any matter requiring the consent of all the Lenders; provided,
however, that all other benefits and obligations under the Credit Documents
shall apply to such Defaulting Lender.
11.10 SURVIVAL OF INDEMNIFICATION AND REPRESENTATIONS AND WARRANTIES.
All indemnities set forth herein and all representations and warranties
made herein shall survive the execution and delivery of this Credit Agreement,
the making of the Loans, the issuance of the Letters of Credit and the
repayment of the Loans, LOC Obligations and other obligations and the
termination of the Commitments hereunder. This Credit Agreement shall
terminate upon the termination of all the Commitments and the repayment in full
of the aggregate outstanding principal amount of all Loans, LOC Obligations,
all interest accrued thereon, and all fees and expenses and other amounts due
and payable under the Credit Agreement; provided, however, notwithstanding the
foregoing all obligations of the Credit Parties that expressly survive the
termination of this Credit Agreement shall continue to remain in full force and
effect following the termination of this Credit Agreement.
11.11 GOVERNING LAW; JURISDICTION.
(a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK (other than the Mortgage Documents which are governed by the
laws of the State where the real property is located that is covered by
such Mortgage Document). Any legal action or proceeding with respect to
this Credit Agreement or any other Credit Document may be brought in the
courts of the State of North Carolina or of the United States for the
Western District of North Carolina, and, by execution and delivery of
this
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Credit Agreement, each Credit Party hereby irrevocably accepts for itself
and in respect of its property, generally and unconditionally, the
jurisdiction of such courts. Each Credit Party further irrevocably
consents to the service of process out of any of the aforementioned
courts in any such action or proceeding by the mailing of copies thereof
by registered or certified mail, postage prepaid, to it at the address
for notices pursuant to Section 11.1, such service to become effective 30
days after such mailing. Nothing herein shall affect the right of a
Lender to serve process in any other manner permitted by law or to
commence legal proceedings or to otherwise proceed against a Credit Party
in any other jurisdiction. Each Credit Party agrees that a final
judgment in any action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law; provided that nothing in this Section 11.11(a) is
intended to impair a Credit Party's right under applicable law to appeal
or seek a stay of any judgment.
(b) Each Credit Party hereby irrevocably waives any objection which
it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with
this Credit Agreement or any other Credit Document brought in the courts
referred to in subsection (a) hereof and hereby further irrevocably
waives and agrees not to plead or claim in any such court that any such
action or proceeding brought in any such court has been brought in an
inconvenient forum.
11.12 WAIVER OF JURY TRIAL.
EACH OF THE PARTIES TO THIS CREDIT AGREEMENT HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF
OR RELATING TO THIS CREDIT AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
11.13 TIME.
All references to time herein shall be references to Eastern Standard Time
or Eastern Daylight time, as the case may be, unless specified otherwise.
11.14 SEVERABILITY.
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
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11.15 FURTHER ASSURANCES.
The Credit Parties agree, upon the request of the Administrative Agent, to
promptly take such actions, as reasonably requested, as is necessary to carry
out the intent of this Credit Agreement and the other Credit Documents,
including, but not limited to, such actions as are necessary to ensure that the
Lenders have a perfected security interest in the Collateral subject to no
Liens other than Permitted Liens.
11.16 ENTIRETY.
This Credit Agreement together with the other Credit Documents represent
the entire agreement of the parties hereto and thereto, and supersede all prior
agreements and understandings, oral or written, if any, including any
commitment letters or correspondence relating to the Credit Documents or the
transactions contemplated herein and therein.
11.17 BINDING EFFECT.
This Credit Agreement shall become effective at such time when all of the
conditions set forth in Section 5.1 have been satisfied or waived by the
Lenders and it shall have been executed by each of the Credit Parties and the
Agents, and the Agents shall have received copies (telefaxed or otherwise)
which, when taken together, bear the signatures of each Lender (including the
Issuing Lenders), and thereafter this Credit Agreement shall be binding upon
and inure to the benefit of each Credit Party, the Agents and each Lender and
their respective successors and assigns. Upon this Credit Agreement becoming
effective, the Prior Credit Agreement shall be deemed terminated and the Credit
Parties (other than those obligations in the Prior Credit Agreement that
expressly survive the termination of the Prior Credit Agreement) and the
lenders party to the Prior Credit Agreement shall no longer have any
obligations thereunder.
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Each of the parties hereto has caused a counterpart of this Credit
Agreement to be duly executed and delivered as of the date first above written.
BORROWER: IPC, INC.
-----------
a Delaware corporation
By:
------------------------------------
Name: Xxxxxxx X. Xxxx
Title: Vice President and Treasurer
GUARANTORS: IVEX PACKAGING CORPORATION
----------- a Delaware corporation
IVEX PAPER MILL CORPORATION
a Delaware corporation
IPMC HOLDING CORPORATION
a Delaware corporation
IPMC, INC.
a Delaware corporation
VALLEY EXPRESS LINES, INC.
a Delaware corporation
KAMA OF ILLINOIS CORPORATION
a Delaware corporation
PACKAGING PRODUCTS, INC.
a Delaware corporation
CFI INDUSTRIES, INC.
a Delaware corporation
CFI RECYCLING, INC.
a Delaware corporation
PLASTOFILM INDUSTRIES, INC.
a Delaware corporation
TRIO PRODUCTS, INC.
a Delaware corporation
By:
-------------------------------------
Name: Xxxxxxx X. Xxxx
Title: Vice President and Treasurer
of each of the above named Guarantors
111
LENDERS:
-------
NATIONSBANK, N.A.,
individually in its capacity as a
Lender and in its capacity as Administrative Agent and Collateral
Agent
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
BANKERS TRUST COMPANY,
individually in its capacity as a Lender and in its capacity as
Documentation Agent
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
[OTHER LENDERS]
