EXHIBIT 10.43
$3,611,517.41
AMENDED AND RESTATED CREDIT AGREEMENT
among
CPI AEROSTRUCTURES, INC.
and
XXXXX, INC.
as Borrowers,
The Several Lenders
from Time to Time Parties Hereto,
and
JPMorgan Chase Bank
as Administrative Agent
Dated as of June 25, 2002
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS.........................................................................................2
1.1 Defined Terms.......................................................................................2
1.2 Other Definitional Provisions......................................................................16
SECTION 2. RESTATEMENT OF LOANS AND TERMS OF REPAYMENT........................................................16
2.1 Loans..............................................................................................16
2.2 Repayment of Loans.................................................................................17
2.3 Fees...............................................................................................18
2.4 Optional Prepayments...............................................................................18
2.5 Mandatory Prepayments..............................................................................18
2.6 Application of Prepayments.........................................................................19
2.7 Interest Rates and Payment Dates...................................................................19
2.8 Late Payment.......................................................................................19
2.9 Interest After Event of Default....................................................................20
2.10 Computation of Interest............................................................................20
2.11 Pro Rata Treatment; Application of Certain Prepayments.............................................20
2.12 Taxes..............................................................................................21
SECTION 3. REPRESENTATIONS AND WARRANTIES.....................................................................22
3.1 Financial Condition................................................................................22
3.2 No Change..........................................................................................22
3.3 Corporate Existence, Compliance with Law...........................................................22
3.4 Corporate Power; Authorization, Enforceable Obligations............................................23
3.5 No Legal Bar.......................................................................................23
3.6 No Material Litigation.............................................................................23
3.7 No Default.........................................................................................23
3.8 Ownership of Property; Liens.......................................................................24
3.9 Intellectual Property..............................................................................24
3.10 Taxes..............................................................................................24
3.11 Federal Regulations................................................................................24
3.12 Labor Matters......................................................................................24
3.13 ERISA..............................................................................................24
3.14 Investment Company Act; Other Regulations..........................................................25
3.15 Subsidiaries.......................................................................................25
3.16 Environmental Matters..............................................................................25
3.17 Accuracy of Information, etc.......................................................................26
3.18 Security Documents.................................................................................27
3.19 Solvency...........................................................................................27
3.20 Senior Indebtedness................................................................................27
3.21 Regulation H.......................................................................................27
SECTION 4. CONDITIONS PRECEDENT...............................................................................27
i
SECTION 5. AFFIRMATIVE COVENANTS..............................................................................30
5.1 Financial Statements...............................................................................30
5.2 Certificates; Other Information....................................................................30
5.3 Payment of Obligations.............................................................................31
5.4 Conduct of Business and Maintenance of Existence, etc..............................................31
5.5 Maintenance of Property, Insurance.................................................................32
5.6 Inspection of Property, Books and Records; Discussions.............................................32
5.7 Notices............................................................................................33
5.8 Environmental Laws.................................................................................33
5.9 Additional Collateral, etc.........................................................................33
SECTION 6. NEGATIVE COVENANTS.................................................................................34
6.1 Financial Condition Covenants......................................................................35
6.2 Limitation on Indebtedness.........................................................................35
6.3 Limitation on Liens................................................................................36
6.4 Limitation on Fundamental Changes..................................................................37
6.5 Limitation on Sale of Assets.......................................................................37
6.6 Limitation on Dividends............................................................................37
6.7 Limitation on Capital Expenditures.................................................................37
6.8 Limitation on Investments, Loans and Advances......................................................37
6.9 Limitation on Payments and Modifications with respect to Seller Note, Seller Security Documents....38
6.10 Limitation on Transactions with Affiliates.........................................................38
6.11 Limitation on Sales and Leasebacks.................................................................38
6.12 Limitation on Changes in Fiscal Periods............................................................38
6.13 Limitation on Negative Pledge Clauses..............................................................38
6.14 Limitation on Restrictions on Subsidiary Distributions.............................................38
6.15 Limitation on Lines of Business....................................................................39
6.16 Limitation on Change in Accounting Treatment.......................................................39
SECTION 7. EVENTS OF DEFAULT..................................................................................39
SECTION 8. THE ADMINISTRATIVE AGENT...........................................................................42
8.1 Appointment........................................................................................42
8.2 Delegation of Duties...............................................................................42
8.3 Exculpatory Provisions.............................................................................42
8.4 Reliance by Administrative Agent...................................................................43
8.5 Notice of Default..................................................................................43
8.6 Non-Reliance on Administrative Agent and Other Lenders.............................................43
8.7 Indemnification....................................................................................44
8.8 Administrative Agent in Its Individual Capacity....................................................44
8.9 Successor Administrative Agent.....................................................................45
8.10 Authorization to Release Liens.....................................................................45
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SECTION 9. PRIOR GUARANTEE....................................................................................45
9.1 Continued Effect of Prior Guarantee................................................................45
9.2 CPI and Xxxxx, Inc. as Co-Borrowers................................................................45
9.3 No Subrogation Contribution, Reimbursement or Indemnity............................................46
SECTION 10. MISCELLANEOUS......................................................................................46
10.1 Amendments and Waivers.............................................................................46
10.2 Notices............................................................................................47
10.3 No Waiver; Cumulative Remedies.....................................................................48
10.4 Survival of Representations and Warranties.........................................................48
10.5 Payment of Expenses and Taxes......................................................................48
10.6 Successors and Assigns; Participations and Assignments.............................................49
10.7 Adjustments; Set-off...............................................................................51
10.8 Counterparts.......................................................................................52
10.9 Severability.......................................................................................52
10.10 Integration........................................................................................52
10.11 GOVERNING LAW......................................................................................52
10.12 Submission To Jurisdiction, Waivers................................................................52
10.13 Acknowledgements...................................................................................53
10.14 WAIVERS OF JURY TRIAL..............................................................................53
iii
A.
SCHEDULES:
1.1 Schedule of Loans
6.3(f) Existing Liens
EXHIBITS:
A. Form of Replacement Term Note (Tranche A)
B. Tranche C Intercreditor and Subordination Agreement
C. Tranche C Term Note
D. Amendment to Seller Intercreditor and Subordination Agreement
E. Amendment to Guarantee and Collateral Agreement
F. Closing Certificate
G. Legal Opinion of Xxxxxxxx Xxxxxx
H. Mortgage, Fixture Filing and Assignment of Leases And Rents (Tranche C
Mortgage)
I. Amendment to Security Agreement between the Seller and the
Administrative Agent
J. Amended and Restated Seller Note
K. CPI Seller Guaranty Amendment
L Seller Mortgage Subordination Agreement
M. Mortgage Modification Agreement
N. Form of Assignment and Acceptance
O. Form of Compliance Certificate
iv
AMENDED AND RESTATED
CREDIT AGREEMENT, dated as of June 25, 2002, among
CPI AEROSTRUCTURES, INC., a
New York corporation ("CPI"), XXXXX, INC., a
Delaware corporation (collectively with CPI, the "Borrowers"), the several banks
and other financial institutions or entities from time to time parties to this
Agreement (the "Lenders"), and JPMORGAN CHASE BANK, as Administrative Agent.
RECITALS
A. The Borrowers and XX Xxxxxx Xxxxx Bank (formerly known as Chase
Manhattan Bank) as Administrative Agent heretofore entered into a
Credit
Agreement as amended by the amendments referred to in Recital C below (the
"Original
Credit Agreement") dated as of October 9, 1997, pursuant to which
Chase Manhattan Bank and Mellon Bank, N.A as Lenders ("Original Lenders") made
certain term loans to Xxxxx, Inc., designated therein as "Tranche A Term Loans"
and "Tranche B Term Loans" in amounts aggregating $10,375,000. CPI guaranteed
Xxxxx, Inc.'s obligations under the Tranche A and Tranche B Term Loans. CPI's
obligations as guarantor are secured under a Guarantee and Collateral Agreement
dated October 9, 1997 as the same is being amended contemporaneously herewith.
B. As permitted under the original
Credit Agreement, the Original
Lenders provided lines of credit ("Line of Credit Loans") to CPI and Xxxxx, Inc.
as co-borrowers, originally aggregating $1,000,000, and increasing to $1,700,000
pursuant to the Eighth Amendment to the Original
Credit Agreement dated October
30, 2001, each such Line of Credit Loan constituting a "Permitted Line of
Credit" as defined under Section 6.2(e) of the Original
Credit Agreement.
C. The Original
Credit Agreement has been amended pursuant to ten
separate Amendments and observance of certain terms of the Original
Credit
Agreement has been waived pursuant to certain waivers and other writings,
pursuant to which, among other matters, the repayment terms applicable to the
Tranche A Term Loans have been changed.
D. GECapital CFE, Inc. is the Assignee of Mellon Bank, N.A. with
respect to the portion of the Tranche A Term Loan, the Tranche B Term Loan and
the Line of Credit Notes originally held by Mellon Bank as the same have been
reduced by payments thereon.
E. JPMorgan Chase Bank as assignee of JPMorgan Leasing, Inc., (formerly
Chase Equipment Leasing, Inc.), an affiliate of JPMorgan Chase Bank, as
equipment lessor to Xxxxx, Inc., is the holder of indebtedness of Xxxxx, Inc. in
the principal amount of $704,484.41 representing the net deficiency ("Deficiency
Debt") arising from the sale by such affiliate of certain equipment previously
leased to Xxxxx, Inc.; and the Lenders and the Borrowers have agreed that the
Deficiency Debt shall be included within this Amended and Restated
Credit
Agreement and shall be secured by the assets of the Borrowers, subordinated and
junior in right of payment, however, to the payment of the Tranche A and Tranche
B Term Loans.
F. The Lenders and the Borrowers have agreed, pursuant to this Amended
and Restated Credit Agreement, to restructure all of the outstanding
indebtedness of the Borrowers (1) under the Original Credit Agreement (in the
case of CPI whether such indebtedness arises out of its status as a co-borrower
under the Permitted Lines of Credit or as a guarantor of the Tranche A and
Tranche B Term Loans) and (2) under the Deficiency Debt, which shall constitute
a Tranche C Term Loan under this Amended and Restated Credit Agreement.
G. The holder of the Seller Note (as defined below) which has been
subordinated and junior in right of payment to the Tranche A and Tranche B Term
Loans and Line of Credit Loans, has agreed that (1) all accrued and unpaid
interest and future interest installments shall continue to accrue on the Seller
Note and (2) the Seller Note shall continue to be so subordinated and junior in
right of payment and in addition shall be subordinated and junior in right of
payment to the Deficiency Debt.
NOW, THEREFORE, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement the terms listed in this
Section 1.1 shall have the respective meanings set forth in this Section 1.1.
"ABR": for any day, a rate per annum (rounded upwards, if necessary, to
the next 1/16 of 1%) equal to the greater of (a) the Prime Rate in effect on
such day and (b) the Federal Funds Effective Rate in effect on such day plus 1/2
of 1%. Any change in the ABR due to a change in the Prime Rate or the Federal
Funds Effective Rate shall be effective as of the opening of business on the
effective day of such change in the Prime Rate or the Federal Funds Effective
Rate, respectively.
"Administrative Agent": JPMorgan Chase Bank, together with its
affiliates, as the arranger of the Commitments and as the administrative agent
for the Lenders under this Agreement and the other Loan Documents, together with
any of its successors.
"Affiliate": as to any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control with,
such Person. For purposes of this definition, "control" of a Person means the
power, directly or indirectly, either to (a) vote 10% or more of the securities
having ordinary voting power for the election of directors (or persons
performing similar functions) of such Person or (b) direct or cause the
direction of the management and policies of such Person, whether by contract or
otherwise.
"Agreement": this Amended and Restated Credit Agreement, as hereafter
amended, supplemented or otherwise modified from time to time.
"Alternative Note": as defined in Section 10.6(f).
2
"Alternative Noteholder": as defined in Section 10.6(f).
"Applicable Margin": for each Tranche A Term Loan and the Tranche C
Term Loan, three and one-half percent (3 1/2 %).
"Asset Sale": any Disposition of Property by either Borrower or any of
its Subsidiaries (excluding any such Disposition permitted by clause (a), (b) or
(c) of Section 6.5).
"Assignee": as defined in Section 10.6(c).
"Assignor": as defined in Section 10.6(c).
"Board": the Board of Governors of the Federal Reserve System of the
United States (or any successor).
"Borrower": the collective reference to CPI and Xxxxx, Inc. unless used
with reference to a particular Borrower.
"Business": as defined in Section 3.17.
"Business Day": a day other than a Saturday, Sunday or other day on
which commercial banks in
New York City are authorized or required by law to
close.
"Capital Expenditures": for any period, with respect to any Person, the
aggregate of all expenditures by such Person and its Subsidiaries for the
acquisition or leasing (pursuant to a capital lease) of fixed or capital assets
or additions to equipment (including replacements, capitalized repairs and
improvements and fixed assets acquired under capital leases during such period)
which should be capitalized under GAAP on a consolidated balance sheet of such
Person and its Subsidiaries.
"Capital Lease Obligations": as to any Person, the obligations of such
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP and, for the purposes of
this Agreement, the amount of such obligations at any time shall be the
capitalized amount thereof at such time determined in accordance with GAAP.
"Capital Stock": any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation) and any
and all warrants, rights or options to purchase any of the foregoing.
"Cash Equivalents": (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition; (b)
Dollar-denominated certificates of deposit, time deposits, eurodollar time
deposits or overnight bank deposits having maturities of one year or less from
the date of acquisition issued by any Lender or by any commercial bank organized
under the laws of the United States of America or any state thereof having
combined capital and surplus of not less than $1,000,000,000; (c) commercial
paper of an issuer rated at least A-1 by Standard & Poor's Ratings Services
("S&P") or at least P-1 by Xxxxx'x Investors Service, Inc. ("Moody's"), if both
of the two named rating agencies cease publishing ratings of commercial paper
issuers generally, and maturing within six months from the date of acquisition;
(d) tax exempt securities maturing within one year from the date of acquisition
and rated at least A by S&P or at least A2 by Moody's; and (e) money market
funds that invest substantially exclusively in investments of the type described
above and that have aggregate assets of at least $2,500,000,000.
3
"Closing Date": the date of execution of this Amended and Restated
Credit Agreement.
"Code": the Internal Revenue Code of 1986, as amended from time to
time.
"Collateral": all Property of the Loan Parties, now owned or hereafter
acquired, upon which a Lien is purported to be created by any Security Document.
"Commitment": as to any Lender, the sum of the Tranche A Term Loan
Commitment and the Tranche B Term Loan Commitment of such Lender.
"Commonly Controlled Entity": an entity, whether or not incorporated,
which is under common control with the Borrower within the meaning of Section
4001 of ERISA or is part of a group which includes the Borrower and which is
treated as a single employer under Section 414 of the Code.
"Compliance Certificate": a certificate duly executed by a Responsible
Officer substantially in the form of Exhibit O.
"Consolidated Net Income": for any period, the consolidated net income
(or loss) of CPI and its Subsidiaries, determined on a consolidated basis in
accordance with GAAP; provided that there shall be excluded (a) the income (or
deficit) of any Person accrued prior to the date it becomes a Subsidiary of CPI
or is merged into or consolidated with CPI or any of its Subsidiaries, (b) the
income (or deficit) of any Person (other than a Subsidiary of CPI) in which CPI
or any of its Subsidiaries has an ownership interest, except to the extent that
any such income is actually received by CPI or such Subsidiary in the form of
dividends or similar distributions and (c) the undistributed earnings of any
Subsidiary of CPI to the extent that the declaration or payment of dividends or
similar distributions by such Subsidiary to either Borrower is not at the time
`permitted by the terms of any Contractual Obligation (other than under any Loan
Document) or Requirement of Law applicable to such Subsidiary.
4
"Consolidated Tangible Net Worth": as of any date, Consolidated Net
Worth after deducting therefrom the following: (a) any surplus resulting from
the write-up of assets subsequent to December 31, 1996; (b) goodwill, including,
without limitation, any amounts (however designated on the balance sheet)
representing the cost of acquisitions in excess of underlying tangible assets or
capitalized transaction costs; (c) patents, trademarks, copyrights and other
Intellectual Property; (d) leasehold improvements not recoverable at the
expiration of a lease; and (e) deferred charges (including, but not limited to,
unamortized debt discount and expense, organization expenses and experimental
and development expenses).
"Continuing Directors": the directors of CPI on the Closing Date, and
each other director, if, in each case, such other director's nomination for
election to the board of directors of CPI is recommended by at least 66-2/3% of
the then Continuing Directors.
"Contractual Obligations": as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
Property is bound.
"Default": any of the events specified in Section 7, whether or not any
requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
"Disposition": with respect to any Property, any sale, lease, sale and
leaseback, assignment, conveyance, transfer or other disposition thereof; and
the terms "Dispose" and "Dispose of" shall have correlative meanings.
"Dollars" and "$": dollars in lawful currency of the United States of
America.
"EBITDA" shall mean, with respect to the Borrowers for any period,
consolidated net income from operations (before interest, taxes, depreciation
and amortization), determined in accordance with GAAP and in a manner consistent
with the financial statements included in the report of CPI to the Securities
and Exchange commission on Form 10-K for the fiscal year ended December 31,
2001.
"Environmental Laws": any and all foreign, Federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any Governmental Authority or other Requirements of Law
(including common law) regulating, relating to or imposing liability or
standards of conduct concerning protection of human health or the environment,
as now or may at any time hereafter be in effect.
"ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Event of Default": any of the events specified in Section 7, provided
that any requirement for the giving of notice, the lapse of time, or both, has
been satisfied.
"Federal Funds Effective Rate" shall mean, for any day, the weighted
average of the rates on overnight federal funds transactions with members of the
Federal Reserve System arranged by federal funds brokers, as published on the
next succeeding Business Day by the Federal Reserve Bank of
New York, or, if
such rate is not so published for any day which is a Business Day, the average
of the quotations for the day of such transactions received by the Reference
Lender from three federal funds brokers of recognized standing selected by it.
5
"Fixed Charges" shall mean, for any fiscal period with respect to
Borrowers and their Subsidiaries on a consolidated basis, the aggregate of all
Interest Charges paid or accrued during such period plus (a) scheduled payments
of principal with respect to Indebtedness during such period, plus (b) the
unfinanced portion of Capital Expenditures during such period, plus (c) rental
charges paid or accrued with respect to leased real and personal property and
equipment during such period to the extent not deducted in computing EBITDA.
"Fixed Charges Coverage Ratio": shall mean, with respect to Borrowers
and their Subsidiaries on a consolidated basis for any fiscal period, the ratio
of EBITDA to Fixed Charges.
"GAAP": generally accepted accounting principles in the United States
of America as in effect from time to time set forth in the opinions and
pronouncements of the Accounting Principles Board and the American Institute of
Certified Public Accountants and the statements and pronouncements of the
Financial Accounting Standards Board and the rules and regulations of the
Securities and Exchange Commission, or in such other statements by such other
entity as may be in general use by significant segments of the accounting
profession, which are applicable to the circumstances of CPI as of the date of
determination, except that for purposes of Section 6.1, GAAP shall be determined
on the basis of such principles in effect on the date hereof and consistent with
those used in the preparation of the most recent audited financial statements
delivered pursuant to Section 11(b). In the event that any "Accounting Change"
(as defined below) shall occur and such change results in a change in the method
of calculation of financial covenants, standards or terms in this Agreement,
then CPI and the Administrative Agent agree to enter into negotiations in order
to amend such provisions of this Agreement so as to equitably reflect such
Accounting Changes with the desired result that the criteria for evaluating
CPI's financial condition shall be the same after such Accounting Changes as if
such Accounting Changes had not been made. Until such time as such an amendment
shall have been executed and delivered by CPI, the Administrative Agent and the
Required Lenders, all financial covenants, standards and terms in this Agreement
shall continue to be calculated or construed as if such Accounting Changes had
not occurred. "Accounting Changes" refers to changes in accounting principles
required by the promulgation of any rule, regulation, pronouncement or opinion
by the Financial Accounting Standards Board of the American Institute of
Certified Public Accountants or, if applicable, the Securities and Exchange
Commission (or successors thereto or agencies with similar functions).
"Governmental Authority": any nation or government, any state or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government
(including, without limitation, the National Association of Insurance
Commissioners).
6
"Guarantee and Collateral Agreement": the Guarantee and Collateral
Agreement originally dated as of October 9, 1997, as the same is being amended
as of the date hereof and as the same may be further amended, supplemented or
otherwise modified from time to time.
"Guarantee Obligation": as to any Person (the "guaranteeing person"),
any obligation of (a) the guaranteeing person or (b) another Person (including,
without limitation, any bank under any letter of credit) to induce the creation
of which the guaranteeing person has issued a reimbursement, counterindemnity or
similar obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the "primary obligations")
of any other third Person (the "primary obligor") in any manner, whether
directly or indirectly, including, without limitation, any obligation of the
guaranteeing person, whether or not contingent, (i) to purchase any such primary
obligation or any Property constituting direct or indirect security therefor,
(ii) to advance or supply funds (1) for the purchase or payment of any such
primary obligation or (2) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase Property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation, (iv)
under any take-or-pay contract or (v) otherwise to assure or hold harmless the
owner of any such primary obligation against loss in respect thereof, provided,
however, that the term Guarantee Obligation shall not include endorsements of
instruments for deposit or collection in the ordinary course of business. The
amount of any Guarantee Obligation of any guaranteeing person shall be deemed to
be the lower of (a) an amount equal to the stated or determinable amount of the
primary obligation in respect of which such Guarantee Obligation is made and (b)
the maximum amount for which such guaranteeing person may be liable pursuant to
the terms of the instrument embodying such Guarantee Obligation, unless such
primary obligation and the amount for which such guaranteeing person may be
liable are not stated or determinable, in which case the amount of such
Guarantee Obligation shall be such guaranteeing person's reasonably anticipated
liability in respect thereof as determined by the Borrower in good faith.
"Guarantor": each person at any time having an obligation as a
guarantor under the Guarantee and Collateral Agreement.
"Incur" and "Incurrence": as defined in Section 6.2.
"Indebtedness": of any Person at any date, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of Property or services (other than
current trade payables Incurred in the ordinary course of such Person's
business) or relating to advance or progress payments, (c) all obligations of
such Person evidenced by notes, bonds, debentures or other similar instruments,
(d) all indebtedness created or arising under any conditional sale or other
title retention agreement with respect to Property acquired by such Person (even
though the rights and remedies of the seller or lender under such agreement in
the event of default are limited to repossession or sale of such Property), (e)
all Capital Lease Obligations of such Person, (f) all obligations of such
Person, contingent or otherwise, as an account party under acceptance, letter of
credit or similar facilities (g) all obligations of such Person, contingent or
otherwise, to purchase, redeem retire or otherwise acquire for value any Capital
Stock (other than common stock) of such Person, (h) all Guarantee Obligations of
such Person in respect of obligations of the kind referred to in clauses (a)
through (g) above; and (i) all obligations of the kind referred to in clauses
(a) through (h) above secured by (or for which the holder of such obligation has
an existing right contingent or otherwise, to be secured by) any Lien on
Property (including, without limitation, accounts and contract rights) owned by
such Person, whether or not such Person has assumed or become liable for the
payment of such obligation.
7
"Insolvency": with respect to any Multiemployer Plan, the condition
that such Plan is insolvent within the meaning of Section 4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
"Intellectual Property": the collective reference to all rights,
priorities and privileges relating to intellectual property, whether arising
under United States, multinational or foreign laws or otherwise, including,
without limitation, copyrights, copyright licenses, patents, patent licenses,
trademarks, trademark licenses, technology, know-how and processes, and all
rights to xxx at law or in equity for any infringement or other impairment
thereof, including the right to receive all proceeds and damages therefrom.
"Interest Payment Date": the last Business Day of each calendar month,
commencing with June, , 2002.
"Xxxxx, Inc. Liquidation": the disposition by Xxxxx, Inc. of its
remaining assets constituting (i) Collateral under the Guarantee and Collateral
Agreement and (ii) Mortgaged Properties (x) under the Prior Mortgage and (y)
under the Tranche C Mortgage.
"Lien": any mortgage, pledge, hypothecation, assignment, deposit
arrangement encumbrance, lien (statutory or other), charge or other security
interest or any preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement and any capital lease having
substantially the same economic effect as any of the foregoing).
"Line of Credit Loans": as defined in Recital B.
"Loan": any Tranche A Term Loan, or Tranche B Term Loan or Tranche C
Term Loan.
"Loan Documents": this Agreement, the Security Documents and the Notes.
8
"Loan Parties": each of the Borrowers and each Subsidiary of a Borrower
which hereafter becomes is a party to a Loan Document.
"Material Adverse Effect": a material adverse effect on (a) the
business, assets, property, operations, condition (financial or otherwise) or
prospects of CPI and its Subsidiaries taken as a whole or (b) the validity or
enforceability of this Agreement or any of the other Loan Documents or the
rights or remedies of the Administrative Agent or the Lenders hereunder or
thereunder.
"Material Environmental Amount": an amount payable by CPI and/or its
Subsidiaries in excess of $25,000 for remedial costs, compliance costs,
compensatory damages, punitive damages, fines, penalties or any combination
thereof.
"Materials of Environmental Concern": any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as such
in or under any Environmental Law, including, without limitation, asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.
"Mortgage Modification Agreement" means an Amendment to the Prior
Mortgage to reflect an increase in the amount secured thereby to the amount of
the Tranche A Loan, in the form appended hereto as Exhibit M.
"Mortgaged Properties": the real properties currently owned by Xxxxx,
Inc. listed as parcels A and B on Schedule A to the Prior Mortgage and the
Tranche C Mortgage.
"Mortgages": each of the mortgages and deeds of trust made by any Loan
Party, in favor of, or for the benefit of, the Administrative Agent for the
benefit of the Lenders, including (x) the Prior Mortgage as amended by the Prior
Mortgage Amendment and the Tranche C Mortgage, as each of the the same may be
amended, supplemented or otherwise modified from time to time.
"Multiemployer Plan": a Plan that is a multiemployer plan as defined in
Section 4001(a)(3) of ERISA.
"Net Cash Proceeds": (a) in connection with any Asset Sale or any
Recovery Event, the proceeds thereof in the form of cash and Cash Equivalents
(including any such proceeds received by way of deferred payment of principal
pursuant to a note or installment receivable or purchase price adjustment
receivable or otherwise, but only as and when received) of such Asset Sale or
Recovery Event net of attorneys' fees, accountants' fees, investment banking
fees, amounts required to be applied to the repayment of Indebtedness secured by
a Lien expressly permitted hereunder on any asset which is the subject of such
Asset Sale or Recovery Event (other than any Lien pursuant to a Security
Document) and other customary fees and expenses actually Incurred in connection
therewith and net of taxes paid or reasonably estimated to be payable as a
result thereof (after taking into account any available tax credits or
deductions and any tax sharing arrangements) and (b) in connection with any
issuance or sale of equity securities or debt securities or instruments or the
Incurrence of loans, the cash proceeds received from such issuance or
Incurrence, net of attorneys' fees, investment banking fees, accountants' fees,
underwriting discounts and commissions and other customary fees and expenses
actually Incurred in connection therewith.
9
"Non-Excluded Taxes": as defined in Section 2.10(a).
"Non-U.S. Lender": as defined in Section 2.10(b).
"Notes": the collective reference to any promissory note evidencing
Loans.
"Obligations": the unpaid principal of and interest on the Loans
(including, without limitation, interest accruing after the maturity of the
Loans and interest accruing after the filing of any petition in bankruptcy, or
the commencement of any insolvency, reorganization or like proceeding, relating
to either Borrower, whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding), and all other obligations and
liabilities of the Borrower to the Administrative Agent or to any Lender (or, in
the case of Interest Rate Protection Agreements, any affiliate of any Lender),
whether direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter Incurred, which may arise under, out of, or in connection
with, this Agreement, any other Loan Document, or any Interest Rate Protection
Agreement entered into with any Lender or any affiliate of any Lender or any
other document made, delivered or given in connection herewith or therewith,
whether on account of principal, interest reimbursement obligations, fees,
indemnities, costs, expenses (including, without limitation, all fees, charges
and disbursements of counsel to the Administrative Agent or to any Lender that
are required to be paid by either Borrower pursuant hereto) or otherwise.
"Original Credit Agreement" as defined in Paragraph A of the Recitals.
"Participant": as defined in Section 10.6(b).
"PBGC": the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA (or any successor).
"Person": an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated association,
joint venture, Governmental Authority or other entity of whatever nature.
"Plan": at a particular time, any employee benefit plan which is
covered by ERISA and in respect of which the Borrower or a Commonly Controlled
Entity is (or, if such plan were terminated at such time, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Prepayment Premium": for any prepayment of a Tranche B Term Loan, a
premium (as liquidated damages and not as penalty) equal to (a) in the case of
any such prepayment made within the one year period prior to the final stated
maturity date (the "Maturity Date") of the Tranche B Term Loans, all reasonable
losses, expenses and liabilities (including, without limitation, any interest
paid by the relevant Lender to lenders of funds borrowed by it to make or carry
its Tranche B Term Loan and losses sustained by the relevant Lender in
connection with the re-employment of such funds) which the relevant Lender may
Incur with respect to its Tranche B Term Loan, or (b) in the case of any such
prepayment made earlier than one year prior to the Maturity Date, the sum of the
present values, each determined at the appropriate Discount Rate, of the excess,
if any, of (i) the amount of interest computed at the Fixed Rate on the
principal amount of the relevant Lender's Tranche B Term Loan (after giving
effect to any scheduled amortization occurring prior to the first day of each
Calculation Period) deemed to be due on the last day of each Calculation Period
during the remaining term of the Tranche B Term Loans over (ii) the amount of
each corresponding interest of payment computed according to the following
formula:
10
n=x
P Epsilon NETn
V =
n=1
(Px(L-R)) x DAYSn - DAYSn-1
--------- ----------------
360
NETn = (1+Zn) (DAYSn - DAYS0)
------------------
360
X = Number, or fraction thereof, of Calculation
Periods from date of prepayment to date of final
fixed maturity.
P = Principal Prepaid.
L = Fixed Rate.
R = Redeployment Rate.
DAYSn - DAYSn-1 = For each Calculation Period "W', the
actual number of days elapsed during that
Calculation Period.
DAYSn - DAYS0 = For each Calculation Period "n", the actual number
of days elapsed from the date of prepayment to the
last day of that Calculation Period.
Z = For each Calculation Period "W, the Discount Rate
for that Calculation Period.
For the purposes of this definition:
"Calculation Period" shall mean each annual period
commencing on the Closing Date and each anniversary thereof except for
the initial Calculation Period following prepayment, which shall
commence on the date of such prepayment and end on the next following
anniversary date of the Closing Date.
11
"Discount Rate" shall mean for each Calculation
Period, the fixed per annum rate, as determined by the relevant Lender
in its sole discretion on the date of such prepayment, that would be
bid by a fixed rate payor under an arm's-length interest rate swap
transaction having (i) a term approximately equal to such Calculation
Period, (ii) a notional amount equal to the amount of such prepayment,
(iii) a floating rate of LIBOR (determined by the relevant Lender in
accordance with its customary practices) for the notional amount and
(iv) a counterparty of creditworthiness acceptable to the relevant
Lender.
"Fixed Rate" shall mean the fixed rate of interest
with respect to the Tranche B Term Loans set forth in this Agreement.
"Redeployment Rate" shall mean, at any time, the
fixed per annum rate (calculated on the basis of a single annual
interest payment), as determined by the relevant Lender in its sole
discretion on the date of any prepayment of the Tranche B Term Loans,
that would be bid by a fixed rate payor under an arm's-length interest
rate swap transaction having (i) a term approximately equal to the
period commencing on the date of such prepayment and ending on the
Maturity Date, (ii) a notional amount equal to the amount of such
prepayment, (iii) a floating rate of LIBOR (determined by the relevant
Lender in accordance with its customary practices) for the amount and
(iv) a counterparty of creditworthiness acceptable to the relevant
Lender.
"Prime Rate" shall mean the rate of interest per annum publicly
announced from time to time by the Reference Lender as its prime rate in effect
at its principal office in
New York City (the Prime Rate not being intended to
be the lowest rate of interest charged by the Reference Lender in connection
with extensions of credit to debtors).
"Prior Mortgage" means the Mortgage, Fixture Filing and Assignment of
Leases and Rents dated October 9, 1997 given by Xxxxx, Inc. to the
Administrative Agent.
"Projections": as defined in Section 5.2(c).
"Properties": as defined in Section 3.17.
"Property": any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible,
including, without limitation, Capital Stock.
"Recovery Event": any settlement of or payment in respect of any
property or casualty insurance claim or any condemnation proceeding relating to
any asset of either Borrower or any of their Subsidiaries.
"Reference Lender": JPMorgan Chase Bank.
"Register": as defined in Section 10.6(d).
12
"Reorganization": with respect to any Multiemployer Plan, the condition
that such plan is in reorganization within the meaning of Section 4241 of ERISA.
"Replacement Term Note" A Term Note substantially in the form of
Exhibit A issued pursuant to this Agreement in replacement of an outstanding
Term Note issued pursuant to the Original Credit Agreement and in replacement of
a Promissory Note issued in connection with a Permitted Line of Credit (as
defined in the Original Credit Agreement). Separate Replacement Term Notes shall
be issued to each of the Tranche A and Tranche B Lenders in accordance with
their respective Tranche A and Tranche B Term Loan Percentages.
"Reportable Event": any of the events set forth in Section 4043(b) of
ERISA, other than those events as to which the thirty day notice period is
waived under subsection .13, .14, .16, .18, .19 or.20 of PBGC Xxx.xx. 2615.
"Required Lenders": the holders of more than 65% of the outstanding
principal amount of the Tranche A Loans (or, at any time when there shall be
fewer than three Tranche A Term Loan Lenders, each Tranche A Term Loan Lender)
and 65% of the outstanding principal amount of the Tranche B Term Loans, (or at
any time when there shall be fewer than three Tranche B Term Loan Lenders, each
Tranche B Term Loan Lender).
"Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other. Governmental Authority, in each case applicable
to or binding upon such Person or any of its Property or to which such Person or
any of its Property is subject.
"Responsible Officer": as such term pertains to a Borrower, the chief
executive officer, president or chief financial officer of such Borrower, but in
any event with respect to financial matters, the chief financial officer of such
Borrower.
"Restricted Payments": as defined in Section 6.6.
"Security Documents": the collective reference to the Guarantee and
Collateral Agreement as amended through the date hereof and as the same is
amended from time to time; the Mortgages; all other security documents
heretofore delivered to the Administrative Agent as the same may be amended from
time to time granting a Lien on any Property of any Person to secure the
obligations and liabilities of any Loan Party under any Loan Document; and the
Tranche C Mortgage to be delivered by Xxxxx, Inc. to the Administrative
Agreement on the Closing Date for the benefit of the Lenders holding the Tranche
C Term Loan, as the same may hereafter be amended from time to time; and the
Tranche C Intercreditor and Subordination Agreement.
"Seller": Ralok, Inc., a
New York corporation (formerly Xxxxx Machine,
Inc.).
13
"Seller Intercreditor and Subordination Agreement": The Intercreditor
and Subordination Agreement dated October 9, 1997 among the Subordinated Lenders
(as defined therein), CPI, Xxxxx, Inc. and the Administrative Agent, as amended
as of the date hereof or otherwise hereafter modified from time to time.
"Seller Note": the collective reference to the promissory note dated
October 9, 1997 in the amount of $4,000,000 issued by Xxxxx, Inc. to Seller,
together with any guarantee thereof by CPI.
"Seller Security Documents": the collective reference to the Guaranty
Agreement, dated October 9, 1997 among CPI as Guarantor, Xxxxx, Inc., the Seller
and Xxxxxx Xxxxxxx, and the Security Agreement, dated October 9, 1997 among CPI,
Xxxxx, Inc. and the Seller; and the subordinated mortgage dated October 9, 1997
held by the Seller on the Mortgaged Properties, each as amended through the date
hereof; and the Seller Intercreditor and Subordination Agreement.
"Single Employer Plan": any Plan which is covered by Title IV of ERISA,
but which is not a Multiemployer Plan.
"Solvent": when used with respect to any Person, means that as of any
date of determination, (a) the amount of the "present fair saleable value" of
the assets of such Person will as of such date, exceed the amount of all
"liabilities of such Person, contingent or otherwise", as of such date, as such
quoted terms are determined in accordance with applicable federal and state laws
governing determinations of the insolvency of debtors, (b) the present fair
saleable value of the assets of such Person will, as of such date, be greater
than the amount that will be required to pay the liability of such Person on its
debts as such debts become absolute and matured, (c) such Person will not have,
as of such date, an unreasonably small amount of capital with which to conduct
its business, and (d) such Person will be able to pay its debts as they mature.
For purposes of this definition, (i) "debt" means liability on a "claim", and
(ii) "claim" means any (x) right to payment, whether or not such a right is
reduced to judgment liquidated, unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y)
right to an equitable remedy for breach of performance if such breach gives rise
to a right to payment, whether or not such right to an equitable remedy is
reduced to judgment, fixed, contingent matured or unmatured, disputed,
undisputed, secured or unsecured.
"Subsidiary": as to any Person, a corporation, partnership, limited
liability company or other entity of which shares of stock or other ownership
interests having ordinary voting power (other than stock or such other ownership
interests having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries, or both, by such Person. Unless otherwise qualified, all
references to a "Subsidiary" or to "Subsidiaries" in this Agreement shall refer
to a Subsidiary or Subsidiaries of CPI (including, without limitation, Xxxxx,
Inc.) and its Subsidiaries.
14
"Tranche A Term Loan Lender": each Lender that has made a Tranche A
Term Loan, or the Assignee or Assignees of such Lender.
"Tranche A Term Loan": as to any Lender, the principal amount set forth
under the heading "Tranche A Term Loan" opposite such Lender's name on Schedule
1.1, comprising (a) the remaining balance, aggregating $931,571, of the Tranche
A Term Loan advanced pursuant to the Original Credit Agreement plus (b) the
existing indebtedness of the Borrowers, aggregating $1,700,000 (as co-borrowers)
pursuant to Permitted Lines of Credit (as defined in the Original Credit
Agreement) and which shall be converted into a portion of the Tranche A Loan
pursuant to Section 2.1(a). The aggregate principal amount of the Tranche A Term
Loans outstanding is $2,631,571, plus accrued interest.
"Tranche A Term Loan Percentage": as to a Tranche A Term Loan Lender at
any time, the percentage that the aggregate principal amount of such Lender's
Tranche A Term Loan then outstanding constitutes of the aggregate principal
amount of all of the Tranche A Term Loans then outstanding).
"Tranche B Term Loan Lender": each Lender that has made a Tranche B
Term Loan, or the Assignee or Assignees of such Lender.
"Tranche B Term Loan": as to a Tranche B Term Loan Lender, the portion
of the Tranche B Term Loan held by each Lender set forth under the heading
"Tranche B Term Loan Amount" opposite such Lender's name on Schedule 1.1. The
aggregate remaining principal amount of the Tranche B Term Loan is $275,462 plus
accrued interest.
"Tranche B Term Loan Percentage": as to any Lender at any time, the
percentage that such Lender's Tranche B Term Loan then outstanding constitutes
of the aggregate principal amount of all of the Tranche B Term Loans then
outstanding.
"Tranche C Lender": JPMorgan Chase or its Assignee or Assignees.
"Tranche C Mortgage": The Mortgage to be issued by Xxxxx, Inc. to the
Administrative Agreement securing the Tranche C Term Loan, in the form annexed
hereto as Exhibit H.
"Tranche C Intercreditor and Subordination Agreement": The
Intercreditor and Subordination Agreement in the form annexed as Exhibit B
between JPMorgan Chase Bank as the Tranche C Lender, the Lenders holding Tranche
A and Tranche B Loans and JPMorgan Chase Bank as Administrative Agent, pursuant
to which the Tranche C Term Loan is subordinated to the Tranche A and Tranche B
Loans.
"Tranche C Term Loan": $704,484.41, plus accrued interest.
"Tranche C Term Note": a promissory note substantially in the form
annexed as Exhibit C in the amount of the Tranche C Term Loan.
15
"U.S. Taxes": as defined in Section 10.6(d).
"Wholly Owned Subsidiary": as to any Person, any other Person all of
the Capital Stock of which (other than directors' qualifying shares required by
law) is owned by such Person directly and/or through other Wholly Owned
Subsidiaries.
1.2 Other Definitional Provisions. (a) Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in the other Loan Documents or any certificate or other document made
or delivered pursuant hereto or thereto.
(b) As used herein and in the other Loan Documents, and any certificate
or other document made or delivered pursuant hereto or thereto, accounting terms
relating to either Borrower and its Subsidiaries not defined in Section 1.1 and
accounting terms partly defined in Section 1.1, to the extent not defined, shall
have the respective meanings given to them under GAAP.
(c) The words "hereof', "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and Section, Schedule and
Exhibit references are to this Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
SECTION 2. RESTATEMENT OF LOANS AND TERMS OF REPAYMENT
2.1 Loans.
(a) Tranche A Loan. The Tranche A Term Loan:
(i) to the extent consisting of the remaining principal
balance of the Tranche A Loan made under the Original Credit Agreement, shall be
deemed continued and the maturity thereof shall be extended as provided in
Section 2.2(a) below;
(ii) to the extent consisting of the outstanding principal
balance of the Permitted Line of Credit Loans, shall be deemed a continuation
and conversion thereof into a portion of the Tranche A Loan under this
Agreement:
(iii) shall be deemed, in its entirety, a loan to and a joint
and several Obligation of CPI and Xxxxx, Inc. as co-borrowers; and
(iv) shall be included within the Replacement Term Note issued
to each Lender in accordance with their respective Tranche A Term Loan
Percentages.
(b) Tranche B Loan. The Tranche B Loan:
(i) to the extent consisting of the remaining principal
balance of the Tranche B Loan made under the Original Credit Agreement, shall be
deemed continued and the maturity thereof shall be extended as provided in
Section 2.2(a) below;
(ii) shall be deemed, in its entirety, a loan to and a joint
and several Obligation of CPI and Xxxxx, Inc. as co-borrowers;
(iii) shall be included within the Replacement Term Note
issued to each Lender in accordance with their respective Tranche B Term Loan
Percentages.
16
(c) Tranche C Term Loan. The Tranche C Term Loan:
(i) shall be deemed made by JPMorgan Chase Bank simultaneously
with the execution and delivery of this Agreement; and
(ii) shall be represented by a Tranche C Term Note.
2.2 Repayment of Loans.
(a) Tranche A Term Loans. The Tranche A Term Loans shall mature (i) in
four (4) consecutive monthly installments of fifty thousand dollars ($50,000)
each, payable on the last Business Day of June, July, August and September of
2002; (ii) six (6) consecutive monthly installments of seventy five thousand
dollars ($75,000) each, payable on the last Business Day each month from October
2002 through March 2003, (iii) two (2) consecutive monthly installments of one
hundred thousand dollars ($100,000) each, payable on the last Business Day of
each of April and May of 2003, and (iv) in an amount equal to the entire unpaid
principal balance plus interest due and owing thereon on June 30, 2003. Each
installment paid on account of principal of and interest on the Loans pursuant
to this Section 2.2(a) shall be made pro rata according to their respective
Tranche A Loan Percentages.
(b) Tranche B Term Loans. The Tranche B Term Loans shall continue to
mature in equal monthly installments payable on the dates and in the aggregate
amounts set forth on Schedule 2.3(b) to the Original Credit Agreement, as the
same may have been and may hereafter be modified by prepayments.
(c) Tranche C Term Loan. The Tranche C Term Loan shall mature (i) in
twelve (12) consecutive monthly installments of twenty thousand dollars
($20,000) each, payable on the last Business Day of each month from June, 2002
through May, 2003, and a final principal payment of the entire unpaid principal
balance plus interest due and owing thereon on June 30, 2003. Each installment
paid on account of principal of and interest on the Loans pursuant to this
Section 2.2(c) shall be made pro rata to each Lender according to their
respective Tranche C Term Loan Percentages. Notwithstanding the foregoing, the
Tranche C Term Loan shall be subordinated and junior in right of payment to the
payment of the Tranche A Loan, as provided in the Tranche C Intercreditor and
Subordination Agreement. Without limitation of the foregoing, no payment by the
Borrowers or principal or interest shall be applied in respect of the Tranche C
Term Loan if any installment of principal or interest in respect of the Tranche
A Loan or the Tranche B Loan has not been paid when due and remains unpaid.
17
2.3 Fees. The Borrower agrees that if any portion of the Tranche A and
Tranche B Loans currently held by GECapital CFE, Inc. are not refinanced in
their entirety on or before the dates indicated below, the Borrower will pay to
the Administrative Agent for the benefit of the Lenders in accordance with their
respective Tranche A Loan Percentages the fees indicated below on such dates:
September 30, 2002 $25,000
December 31, 2002 $50,000
March 31, 2003 $100,000
June 30, 2003 $150,000
If an Event of Default shall have occurred prior to any such date, the fee due
on the next succeeding date shall be immediately due and payable, and each of
the succeeding scheduled fee payments shall become payable on their scheduled
dates unless both of the Tranche A and Tranche B Loans are refinanced or repaid
in their entirety on or before such dates. As used herein, "refinanced" means a
payment in full of the GECapital CFE, Inc. Tranche A and Tranche B Loan
Percentages or the transfer by GECapital CFE, Inc. its entire Tranche A and
Tranche B Loan Percentages to a third party that is not an affiliate of
GECapital CFE, Inc.
2.4 Optional Prepayments. The Borrower may at any time and from time to
time prepay the Loans, in whole or in part, subject to payment of the Prepayment
Premium in the case of the Tranche B Term Loan, upon irrevocable notice
delivered to the Administrative Agent at least five Business Days prior thereto,
which notice shall specify the date and amount of prepayment. Upon receipt of
any such notice the Administrative Agent shall promptly notify each relevant
Lender thereof. If any such notice is given, the amount specified in such notice
shall be due and payable on the date specified therein, together with accrued
interest to such date on the amount prepaid. Partial prepayments shall be in an
aggregate principal amount of $100,000 or a whole multiple thereof. Such partial
optional prepayments shall be applied (x) first to the Tranche A Term Loan until
all outstanding principal and accrued interest thereon is paid in full, (y) then
to the Tranche B Term Loan until all outstanding principal, accrued interest
thereon and any Prepayment Penalty in respect of such prepayment is paid in
full, and (x) thereafter to the Tranche C Term Loan.
2.5 Mandatory Prepayments.
(a) Unless the Required Lenders shall otherwise agree, if additional
Capital Stock or Indebtedness shall be issued or Incurred by either of the
Borrowers, or any of their Subsidiaries (excluding any Indebtedness Incurred in
accordance with Section 6.2 as in effect on the date of this Agreement), an
amount equal to 100% of the Net Cash Proceeds thereof shall be applied on the
date of such issuance or Incurrence (i) first, toward the prepayment of the
Tranche B Term Loans and (ii) then, toward the prepayment of the Tranche A Term
Loans.
18
(b) Unless the Required Lenders shall otherwise agree, if on any date
CPI or any of its Subsidiaries shall (i) receive Net Cash Proceeds from any
Asset Sale or Recovery Event or (ii) receive any purchase price adjustment
pursuant to the Acquisition Agreement then such Net Cash Proceeds or purchase
price adjustment, as the case may be, shall be applied within 10 days after such
date (i) first, toward the prepayment of the Tranche B Term Loans and (ii) then,
toward the prepayment of the Tranche A Term Loans.
2.6 Application of Prepayments. Each prepayment shall be applied (v)
first to the payment of any accrued and unpaid fees pursuant to Section 2.3, (w)
then to the payment of any other obligations accrued and unpaid hereunder other
than pursuant to the principal of and interest on any of the Loans, (x) then to
the Tranche B Term Loan until all outstanding principal and accrued interest
thereon is paid in full, (y) then to the Tranche A Term Loan until all
outstanding principal, accrued interest thereon and any Prepayment Penalty in
respect of such prepayment is paid in full, and (z) thereafter to the Tranche C
Term Loan.
2.7 Interest Rates and Payment Dates. (a) At any time when Sections 2.8
and 2.9 are not applicable, the Tranche A and the Tranche C Term Loans shall
each bear interest at a rate per annum equal to the Prime Rate plus three and
one-half percent (3 1/2 %).
(b) The Tranche B Term Loans shall bear interest at a rate per annum
equal to 8.3%.
(c) Interest in respect of the Tranche A and Tranche C Term Loans shall
be payable in arrears on each Interest Payment Date, provided that interest
accruing pursuant to Section 2.9 shall be payable from time to time on demand.
(d) Interest in respect of the Tranche B Term Loans shall be payable on
the dates and in the amounts specified in Schedule 2.3(b) of the Original Credit
Agreement, provided that interest accruing pursuant to Section 2.9 shall be
payable from time to time on demand.
2.8 Late Payment. (i) If all or a portion of the principal amount of
any Loan shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise), all outstanding Loans (whether or not overdue) shall
bear interest at a rate per annum which is equal to the rate that would
otherwise be applicable thereto pursuant to the provisions of Section 2.7 plus
2% and (ii) if all or a portion of any interest payable on any Loan or any other
amount payable hereunder shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), such overdue amount shall bear interest
at a rate per annum equal to the rate applicable to Tranche A and Tranche C Term
Loans, or Tranche B Term Loans, as the case may be, plus 2%, in each case, with
respect to clauses (i) and (ii) above, from the date of such non-payment until
such amount is paid in full (after as well as before judgment).
19
2.9 Interest After Event of Default. In all instances other than as
described in Section 2.8 above, at any time when an Event of Default shall have
occurred and be continuing, the Tranche A and Tranche C Term Loans shall bear
interest at a rate per annum equal to the ABR plus the Applicable Margin plus 2%
and (ii) in all instances other than as described in Section 2.8 above, at any
time when an Event of Default shall have occurred and be continuing, the Tranche
B Term Loans shall bear interest at a rate per annum equal to the amount set
forth in Section 2.7(b) plus 2%.
2.10 Computation of Interest. (a) Interest payable pursuant hereto
shall be calculated on the basis of a 360-day year for the actual days elapsed.
Any change in the interest rate on a Loan resulting from a change in the ABR
shall become effective as of the opening of business on the day on which such
change becomes effective.
(b) Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Agreement shall be conclusive and binding on
the Borrower and the Lenders in the absence of manifest error.
2.11 Pro Rata Treatment; Application of Certain Prepayments. (a) Each
borrowing by the Borrower from the Lenders hereunder shall be deemed to have
been made pro rata according to the respective Tranche A Term Loan Percentages,
Tranche B Term Loan Percentages or Tranche C Term Loan Percentages, as the case
may be, of the relevant Lenders as of the Closing Date.
(b) All payments (including prepayments) to be made by the Borrower
hereunder, whether on account of principal, interest, fees or otherwise, shall
be made without setoff or counterclaim and shall be made prior to 12:00 Noon,
New York City time, on the due date thereof to the Administrative Agent, for the
account of the Lenders, at the Administrative Agent's office specified in
Section 10.2, in Dollars and in immediately available funds. The Administrative
Agent shall have the right to charge any account maintained by the Borrower with
the Administrative Agent to the extent necessary to make any such payment. The
Administrative Agent shall distribute such payments to the Lenders promptly upon
receipt in like funds as received.
20
2.12 Taxes. (a) All payments made by the Borrower under this Agreement
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 Governmental Authority, excluding
net income taxes and franchise taxes (imposed in lieu of net income taxes)
imposed on the Administrative Agent or any Lender as a result of a present or
former connection between the Administrative Agent or such Lender and the
jurisdiction of the Governmental Authority imposing such tax or any political
subdivision or taxing authority thereof or therein (other than any such
connection arising solely from the Administrative Agent or such Lender having
executed, delivered or performed its obligations or received a payment under, or
enforced, this Agreement or any other Loan Document). 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, 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 Agreement, provided, however, that the
Borrowers shall not be required to increase any such amounts payable to any
Lender that is not organized under the law of the United States of America or a
state thereof to the extent such Lender's compliance with the requirements of
Section 2.12(b) at the time such Lender becomes a party to this Agreement fails
to establish a complete exemption from such withholding. Whenever any
Non-Excluded Taxes are payable by the Borrowers, as promptly as possible
thereafter 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 Borrowers fail to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fail to remit to the Administrative Agent the
required receipts or other required documentary evidence, the Borrowers shall
indemnify the Administrative Agent and the Lenders for any incremental taxes,
interest or penalties that may become payable by the Administrative Agent or any
Lender as a result of any such failure. The agreements in this Section 2.9 shall
survive the termination of this Agreement and the payment of the Loans and all
other amounts payable hereunder.
(b) Each Lender (or Transferee) that is not a citizen or resident of
the United States of America, a corporation, partnership or other entity created
or organized in or under the laws of the United States of America (or any
jurisdiction thereof), or any estate or trust that is subject to federal income
taxation regardless of the source of its income (a "Non-U.S. Lender") shall
deliver to the Borrowers and the Administrative Agent (or, in the case of a
Participant, to the Lender from which the related participation shall have been
purchased) two copies of either U.S. Internal Revenue Service Form W-8BEN or
Form W-8ECI, or, in the case of a Non-U.S. Lender claiming exemption from U.S.
federal withholding tax under Section 871(h) or 881(c) of the Code with respect
to payments of "portfolio interest", a Form W-8BEN or any subsequent versions
thereof or successors thereto (and, if such Non-U.S. Lender delivers a Form
W-8BEN, an annual certificate representing that such Non-U.S. Lender is not a
"bank" for purposes of Section 881(c) of the Code, is not a 10-percent
shareholder (within the meaning of Section 871(h)(3)(B) of the Code) of the
Borrower and is not a controlled foreign corporation related to the Borrower
(within the meaning of Section 864(d)(4) of the Code)), properly completed and
duly executed by such Non-U.S. Lender claiming complete exemption from, or a
reduced rate of, U.S. federal withholding tax on all payments by the Borrower
under this Agreement and the other Loan Documents. Such forms shall be delivered
by each Non-U.S. Lender on or before the date it becomes a party to this
Agreement (or, in the case of any Participant, on or before the date such
Participant purchases the related participation). In addition, each Non-U.S.
Lender shall deliver such forms promptly upon the obsolescence or invalidity of
any form previously delivered by such Non-U.S. Lender. Each Non-U.S. Lender
shall promptly notify the Borrowers at any time it determines that it is no
longer in a position to provide any previously delivered certificate to the
Borrowers (or any other form of certification adopted by the U.S. taxing
authorities for such purpose). Notwithstanding any other provision of this
Section 2.10(b), a Non-U.S. Lender shall not be required to deliver any form
pursuant to this Section 2.10(b) that such Non-U.S. Lender is not legally able
to deliver.
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SECTION 3. REPRESENTATIONS AND WARRANTIES
Borrowers hereby jointly and severally confirm and reaffirm that the
representations and warranties set forth in Section 3 of the Original Credit
Agreement were true, accurate and complete as of the date made.
Further, without limitation of the foregoing and to induce the
Administrative Agent and the Lenders to enter into this Amended and Restated
Credit Agreement, each of the Borrowers hereby jointly and severally represent
and warrant to the Administrative Agent and each Lender that
3.1 Financial Condition. The audited consolidated balance sheet of CPI
and its consolidated Subsidiaries as of December 31, 2001 and the related
consolidated statements of income and of cash flows for the fiscal year ended on
such dates, reported on by and accompanied by the report of Xxxxxxxxx Xxxxx
Xxxxxxx LLP present fairly the consolidated financial condition of CPI and its
consolidated Subsidiaries as at such date, and the consolidated results of its
operations and its consolidated cash flows for the respective fiscal years then
ended. The unaudited consolidated balance sheet of CPI and its consolidated
Subsidiaries as at March 31, 2002, and the related unaudited consolidated
statements of income and cash flows for the three month period ended on such
date, presents fairly the consolidated financial condition of CPI and its
consolidated Subsidiaries as at such date, and the consolidated results of its
operations and its consolidated cash flows for month period then ended (subject
to normal year-end audit adjustments). All such financial statements, including
the related schedules and notes thereto, have been prepared in accordance with
GAAP applied consistently throughout the periods involved (except as approved by
the aforementioned firm of accountants and disclosed therein). CPI and its
consolidated Subsidiaries do not have any material Guarantee Obligations,
contingent liabilities and liabilities for taxes, or any long-term leases or
unusual forward or long-term commitments, including, without limitation, any
interest rate or foreign currency swap or exchange transaction or other
obligation in respect of derivatives, which are not reflected in the most recent
financial statements referred to in this Section 3.1 During the period from
December 31, 2001 to and including the date hereof there has been no Disposition
by CPI or any of its Subsidiaries of any material part of its business or
Property, other than for the Disposition of Xxxxx, Inc. assets in connection
with the Xxxxx, Inc. Liquidation.
3.2 No Change. Since March 31, 2002 there has been no development or
event that has had or could reasonably be expected to have a Material Adverse
Effect. For purposes of this Section 3.2, the Xxxxx, Inc. Liquidation shall not
be deemed to have had a Material Adverse Effect.
3.3 Corporate Existence, Compliance with Law. Each of the Borrowers,
(a) is duly organized, validly existing and in good standing under the laws of
the jurisdiction of its organization, (b) has the corporate power and authority,
and the legal right, to own and operate its Property, to lease the Property it
operates as lessee and to conduct the business in which it is currently engaged,
(c) is duly qualified as a foreign corporation and in good standing under the
laws of each jurisdiction where its ownership, lease or operation of Property or
the conduct of its business requires such qualification and (d) is in compliance
with all Requirements of Law except to the extent that the failure to comply
therewith could not in the aggregate, reasonably be expected to have a Material
Adverse Effect. As of the date hereof, the only Subsidiary of CPI is Xxxxx,
Inc., and Xxxxx, Inc. has no Subsidiaries.
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3.4 Corporate Power; Authorization, Enforceable Obligations. Each Loan
Party has the corporate power and authority, and the legal right, to make,
deliver and perform the Loan Documents to which it is a party. Each Loan Party
has taken all necessary corporate action to authorize the execution, delivery
and performance of the Loan Documents to which it is a party. No consent or
authorization of, filing with, notice to or other act by or in respect of, any
Governmental Authority or any other Person is required in connection with the
borrowings hereunder or with the execution, delivery, performance, validity or
enforceability of this Agreement or any of the Loan Documents, except the
filings referred to in Section 3.19. Each Loan Document has been duly executed
and delivered on behalf of each Loan Party that is a party thereto. This
Agreement constitutes, and each other Loan Document upon execution will
constitute, a legal, valid and binding obligation of each Loan Party that is a
party thereto, enforceable against each such Loan Party in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
3.5 No Legal Bar. The execution, delivery and performance of this
Agreement and the other Loan Documents will not violate any Requirement of Law
or any Contractual Obligation of either of the Borrowers or any of its
Subsidiaries and will not result in, or require, the creation or imposition of
any Lien on any of their respective properties or revenues pursuant to any
Requirement of Law or any such Contractual Obligation (other than the Liens
created by the Security Documents). No Requirement of Law or Contractual
Obligation applicable to CPI or any of its Subsidiaries could reasonably be
expected to have a Material Adverse Effect.
3.6 No Material Litigation. No litigation, investigation or proceeding
of or before any arbitrator or Governmental Authority is pending or, to the
knowledge of either Borrower, threatened by or against either Borrower or any of
its Subsidiaries or against any of their respective properties or revenues (a)
with respect to any of the Loan Documents or any of the transactions
contemplated hereby or thereby or (b) which could reasonably be expected to have
a Material Adverse Effect.
3.7 No Default. Neither Borrower is in default under or with respect to
any of its Contractual Obligations in any respect that could reasonably be
expected to have a Material Adverse Effect. No Default or Event of Default has
occurred and is continuing.
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3.8 Ownership of Property; Liens. Each Borrower has title in fee simple
to, or a valid leasehold interest in, all its real property, and good title to,
or a valid leasehold interest in, all its other Property, and none of such
Property is subject to any Lien except as permitted by Section 6.3.
3.9 Intellectual Property. Each Borrower owns, or is licensed to use,
all Intellectual Property necessary for the conduct of its business as currently
conducted. No material claim has been asserted and is pending by any Person
challenging or questioning the use of any Intellectual Property or the validity
or effectiveness of any Intellectual Property, nor does either Borrower know of
any valid basis for any such claim. The use of Intellectual Property by the
Borrowers does not infringe on the rights of any Person in any material respect
3.10 Taxes. Each Borrower has filed or caused to be filed all Federal,
state and other material tax returns which are required to be filed and has paid
all taxes shown to be due and payable on said returns or on any assessments made
against it or any of its Property and all other taxes, fees or other charges
imposed on it or any of its Property by any Governmental Authority (other than
any the amount or validity of which are currently being contested in good faith
by appropriate proceedings and with respect to which reserves in conformity with
GAAP have been provided on the books of each Borrower with respect to any amount
so contested); no tax Lien has been filed, and, to the knowledge of each
Borrower, no claim is being asserted, with respect to any such tax, fee or other
charge.
3.11 Federal Regulations. No part of the proceeds of any Loans made
pursuant to the Original Credit Agreement have been used for "purchasing" or
"carrying" any "margin stock" within the respective meanings of each of the
quoted terms under Regulation G or Regulation U of the Board as in effect at the
time such Loans were made or for any purpose which violated the provisions of
the Regulations of the Board.
3.12 Labor Matters. There are no strikes or other labor disputes
against either Borrower pending or, to the knowledge of either Borrower,
threatened that (individually or in the aggregate) could reasonably be expected
to have a Material Adverse Effect. Hours worked by and payment made to employees
of each Borrower have not been in violation of the Fair Labor Standards Act or
any other applicable Requirement of Law dealing with such matters that
(individually or in the aggregate) could reasonably be expected to have a
Material Adverse Effect. All payments due from either Borrower on account of
employee health and welfare insurance that (individually or in the aggregate)
could reasonably be expected to have a Material Adverse Effect if not paid have
been paid or accrued as a liability on the books of the Borrower obligated
therefor.
3.13 ERISA. Neither a Reportable Event nor an "accumulated funding
deficiency" (within the meaning of Section 412 of the Code or Section 302 of
ERISA) has occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan, and each Plan
has complied in all material respects with the applicable provisions of ERISA
and the Code. No termination of a Single Employer Plan has occurred, and. no
Lien in favor of the PBGC or a Plan has arisen, during such five-year period.
The present value of all accrued benefits under each Single Employer Plan (based
on those assumptions used to fund such Plans) did not, as of the last annual
valuation date prior to the date on which this representation is made or deemed
made, exceed the value of the assets of such Plan allocable to such accrued
benefits by a material amount. Neither Borrower nor any Commonly Controlled
Entity of either Borrower has had a complete or partial withdrawal from any
Multiemployer Plan which has resulted or could reasonably be expected to result
in a material liability under ERISA, and neither Borrower nor any Commonly
Controlled Entity thereof would become subject to any material liability under
ERISA if such Borrower or any such Commonly Controlled Entity were to withdraw
completely from all Multiemployer Plans as of the valuation date most closely
preceding the date on which this representation is made or deemed made. No such
Multiemployer Plan is in Reorganization or Insolvent.
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3.14 Investment Company Act; Other Regulations. No Loan Party is an
"investment company", or a company "controlled' by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended. No Loan
Party is subject to regulation under any Requirement of Law (other than
Regulation X of the Board) which limits its ability to Incur Indebtedness.
3.15 Subsidiaries. The only Subsidiary of CPI is Xxxxx, Inc., and
Xxxxx, Inc. has no Subsidiaries. Neither Borrower has organized or acquired any
Subsidiary since January 1, 1991 other than the organization by CPI of Xxxxx,
Inc. in 1997.
3.16 Environmental Matters.
(a) The facilities and properties owned, leased or operated by the
Borrowers (the "Properties") do not contain, and to the best of their knowledge
have not previously contained, any Materials of Environmental Concern in amounts
or concentrations or under circumstances which (i) constitute or constituted a
violation of, or (ii) could give rise to liability under, any Environmental Law,
except in either case insofar as such violation or liability, or any aggregation
thereof, could not reasonably be expected to result in the payment of a Material
Environmental Amount.
(b) The Properties and all operations at the Properties are in material
compliance, and have, to the best of their knowledge in the last five years been
in material compliance, with all applicable Environmental Laws, and there is no
contamination at, under or about the Properties or violation of any
Environmental Law with respect to the Properties or the business operated by the
Borrowers (the "Business") which could materially interfere with the continued
operation of the Properties or materially impair the fair saleable value
thereof. Neither Borrower has assumed any liability of any other Person under
Environmental Laws.
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(c) Neither Borrower has received or is aware of any notice of
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 Business, nor does either Borrower have
knowledge or reason to believe that any such notice will be received or is being
threatened, except insofar as such notice or threatened notice, or any
aggregation thereof, does not involve a matter or matters that could reasonably
be expected to result in the payment of a Material Environmental Amount.
(d) To the best of the Borrowers' knowledge, since the date hereof
Materials of Environmental Concern have not been transported or disposed of from
the Properties in violation of, or in a manner or to a location which could give
rise to liability under, any Environmental Law, nor have any Materials of
Environmental Concern been generated, treated, stored or disposed of at on or
under any of the Properties in violation of, or in a manner that could give rise
to liability under, any applicable Environmental Law, except insofar as any such
violation or liability referred to in this paragraph, or any aggregation
thereof, could not reasonably be expected to result in the payment of a Material
Environmental Amount.
(e) No judicial proceeding or governmental or administrative action is
pending or, to the knowledge of v Borrower, threatened, under any Environmental
Law to which either Borrower is or will be named as a party with respect to the
Properties or the Business, nor are there any consent decrees or other decrees,
consent orders, administrative orders or other orders, or other administrative
or judicial requirements outstanding under any Environmental Law with respect to
the Properties or the Business, except insofar as such proceeding, action,
decree, order or other requirement or any aggregation thereof, could not
reasonably be expected to result in the payment of a Material Adverse Amount.
(f) To the best of the Borrowers' knowledge, there has been no release
or threat of release of Materials of Environmental Concern at or from the
Properties, or arising from or related to the operations of either Borrower in
connection with the Properties or otherwise in connection with the Business, in
violation of or in amounts or in a manner that could give rise to liability
under Environmental Laws, except insofar as any such violation or liability
referred to in this paragraph, or any aggregation thereof, could not reasonably
be expected to result in the payment of a Material Environmental Amount.
3.17 Accuracy of Information, etc. No statement or information
contained in this Agreement, any other Loan Document, or any other document,
certificate or statement furnished to the Administrative Agent or the Lenders or
any of them by or on behalf of any Loan Party for use in connection with the
transactions contemplated by this Agreement or the other Loan Documents,
contained as of the date such statement, information, document or certificate
was so furnished, any untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements contained herein or
therein not misleading. The projections and pro forma financial information
contained in the materials referenced above are based upon good faith estimates
and assumptions believed by management of the Borrowers to be reasonable at the
time made, it being recognized by the Lenders that such financial information as
it relates to future events is not to be viewed as fact and that actual results
during the period or periods covered by such financial information may differ
from the projected results set forth therein by a material amount. As of the
date hereof, each of the representations and warranties contained in the
Acquisition Agreement is true and correct in all material respects. There is no
fact known to any Loan Party that could reasonably be expected to have a
Material Adverse Effect that has not been expressly disclosed herein, in the
other Loan Documents, or in any other documents, certificates and statements
furnished to the Administrative Agent and the Lenders for use in connection with
the transactions contemplated hereby and by the other Loan Documents.
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3.18 Security Documents. (a) The Guarantee and Collateral Agreement is
and continues to be effective in favor of the Administrative Agent, for the
benefit of the Lenders and is a legal, valid and enforceable security interest
in the Collateral described therein and proceeds thereof. The Guarantee and
Collateral Agreement constitutes and continues to constitute a fully perfected
Lien on, and security interest in, all right, title and interest of the Loan
Parties in such Collateral and the proceeds thereof, as security for the
Obligations (as defined in the Guarantee and Collateral Agreement), in each case
prior and superior in right to any other Person.
(b) The Tranche C Mortgage is effective to create in favor of the
Administrative Agent, for the benefit of the Tranche C Lenders, a legal, valid
and enforceable Lien on the Mortgaged Properties described therein and proceeds
thereof and when the Tranche C Mortgage is recorded in the office of the County
Clerk of Xxxxxxxx County,
New York, such Tranche C Mortgage shall constitute a
fully perfected Lien on, and security interest in, all right, title and interest
of the Loan Parties in the Mortgaged Properties and the proceeds thereof, as
security for the Tranche C Term Loan, in each case prior and superior in right
to any other Person, other than (i) the rights of the Administrative Agent for
the benefit of the Lenders under the Mortgages heretofore issued pursuant to the
Original Credit Agreement and (ii) the rights of the Seller under the Seller
Security Documents (subject to the Tranche C Intercreditor and Subordination
Agreement and to the Amendment to the Seller Intercreditor and Subordination
Agreement substantially in the form appended hereto as Exhibit D being executed
contemporaneously herewith between the Administrative Agent, the Tranche C
Lenders and the Seller).
3.19 Senior Indebtedness. The obligations of each Borrower under the
Loan documents to which it is a party, including without limitation, the
Obligations, constitute "Senior Indebtedness" of each Borrower under the Seller
Intercreditor and Subordination Agreement as amended through the date hereof.
3.20 Regulation H. No Mortgage encumbers improved real property which
is located in an area that has been identified by the Secretary of Housing and
Urban Development as an area having special flood hazards and in which flood
insurance has been made available under the National Flood Insurance Act of
1968.
3.21 Solvency CPI is, and will be and will continue to be, Solvent.
SECTION 4. CONDITIONS PRECEDENT
The agreement of each Lender to enter into this Agreement is
subject to the satisfaction on the Closing Date, of the following conditions
precedent:
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(a) Loan Documents. The Administrative Agent shall have received,
executed and delivered by a duly authorized officer of each Borrower (and duly
acknowledged as requested by the Administrative Agent), (i) this Agreement, (ii)
the amendment to the Guarantee and Collateral Agreement in the form annexed as
Exhibit E, (iii) for the account of each relevant Lender, the Replacement Term
Notes and the Tranche C Term Note, and (iv) the Mortgage Modification Agreement.
(b) Lien Searches and Title Search. The Administrative Agent shall have
received the results of a recent lien search in each of the jurisdictions where
assets of the Loan Parties are located, and such search shall reveal no liens on
any of the assets of Loan Parties except for liens permitted by Section 6.3,
and, in the case of such title search shall not reveal any encumbrances on the
Mortgaged Properties in addition to those set forth in the mortgagee's title
insurance policy issued pursuant to Section 4 of the Original Credit Agreement
other than encumbrances acceptable to the Administrative Agent in its sole
discretion.
(c) Closing Certificate. The Administrative Agent shall have received,
with a counterpart for each Lender, a Closing Certificate of each Loan Party,
dated the Closing Date, substantially in the form of Exhibit F, with appropriate
insertions and attachments.
(d) Legal Opinions. The Administrative Agent shall have received the
legal opinion of Xxxxxxxx Xxxxxx, counsel to the Borrowers, substantially in the
form of Exhibit G.
(e) Seller Intercreditor and Subordination Agreement. The
Administrative Agent shall have received an amendment to the Seller
Intercreditor and Subordination Agreement executed by Seller, substantially in
the form annexed hereto as Exhibit D.
(f) Tranche C Mortgage. The Administrative Agent shall have received
the Tranche C Mortgage executed and delivered by a duly authorized officer of
Xxxxx, Inc., in the form annexed hereto as Exhibit H in proper form for
recording in the office of the County Clerk of Xxxxxxxx County,
New York.
(g) Tranche C Intercreditor and Subordination Agreement. The
Administrative Agent shall have received the Tranche C Intercreditor and
Subordination Agreement executed by Seller.
(h) Security Agreement Amendment Relating to Tranche C The
Administrative Agent shall have received an Amendment to the Security Agreement
between the Seller and the Administrative Agent dated October 9, 1997, executed
by Seller in the form annexed hereto as Exhibit I.
(i) Seller Note Amendment The Seller shall have agreed to a Seller Note
Amendment Agreement in the form annexed hereto as Exhibit J and the
Administrative Agent shall have received a certified copy thereof.
(j) CPI Seller Guaranty Amendment The Seller shall have agreed to an
amendment of the Guaranty Agreement given by CPI in favor of Ralok, Inc.
(formerly Xxxxx Machine, Inc.) pursuant to a Seller Guaranty Agreement Amendment
in the form annexed hereto as Exhibit K and the Administrative Agent shall have
received a certified copy thereof.
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(k) Seller Mortgage Subordination Agreement The Seller shall have
executed and delivered to the Administrative Agent a Seller Mortgage
Subordination Agreement in the form annexed hereto as Exhibit L.
(l) Mortgage Modification Agreement Xxxxx, Inc. shall have executed and
delivered to the Administrative Agent a Mortgage Modification Agreement in the
form annexed hereto as Exhibit M.
(m) Filings, Registrations and Recordings. Each document (including,
without limitation, any Uniform Commercial Code financing statement) required by
the Security Documents or under law or reasonably requested by the
Administrative Agent to be filed, registered or recorded in order to create or
continue in favor of the Administrative Agent for the benefit of the Lenders
(including without limitation in respect of the Lenders holding the Tranche C
Term Loan) a perfected Lien on the Collateral described therein, prior and
superior in right to any other Person (subject to the provisions of the Tranche
C Intercreditor and Subordination Agreement), shall be in proper form for
filing, registration or recordation.
(n) Good Standing Certificates. The Administrative Agent shall have
received good standing certificates in respect of the jurisdiction of
incorporation of each Loan Party and each other jurisdiction where such Loan
Party is qualified to do business as a foreign corporation.
(o) Change in Business. In the judgment of the Lenders, there shall
have occurred no material adverse change in the business, condition (financial
or otherwise), operations, performance, properties or prospects of either
Borrower since March 31, 2002.
(p) Fees and Expenses. All accrued fees and expenses (including the
fees and disbursements of counsel billed to the Administrative Agent) shall have
been paid.
(q) Litigation. There shall exist no action, suit, investigation,
litigation or proceeding pending or threatened in any court of before any
arbitrator or governmental instrumentality that, in the reasonable judgment of
the Administrative Agent and its counsel, would be likely to have a Material
Adverse Effect.
(r) Representations and Warranties. Each of the representations and
warranties made by any Loan Party in or pursuant to the Loan Documents shall be
true and correct on and as of the Closing Date as if made on and as of such
date.
(s) No Default. No Default or Event of Default shall have occurred and
be continuing on such date or after giving effect to the making of the Loan
requested to be made on the Closing Date.
(t) Miscellaneous. The Administrative Agent and the Lenders shall have
received such other documents or information as the Administrative Agent and the
Lenders shall reasonably request.
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SECTION 5. AFFIRMATIVE COVENANTS
The Borrowers hereby jointly and severally agree that so long as any
Loan or other amount is owing to any Lender or the Administrative Agent
hereunder, each of the Borrowers shall and shall cause each of its Subsidiaries
hereafter created to:
5.1 Financial Statements. Furnish to the Administrative Agent and each
Lender:
(a) (i) as soon as available, but in any event within 90 days after the
end of each fiscal year of CPI, a copy of the audited consolidated and
consolidating balance sheet of CPI and its consolidated Subsidiaries as at the
end of such year and the related audited consolidated and consolidating
statements of income and of cash flows for such year, setting forth in each case
in comparative form the figures for the previous year, reported on without a
"going concern" or like qualification or exception, or qualification arising out
of the scope of the audit, by Xxxxxxxxx Xxxxx Xxxxxxx LLP, or other independent
certified public accountants of nationally recognized standing and (ii) a copy
of any management letter prepared by the accountants for CPI and/or Xxxxx, Inc.;
and
(b) as soon as available, but in any event not later than 45 days after
the end of each of the first three quarterly periods of each fiscal year of CPI,
the unaudited consolidated and consolidating balance sheet of CPI and its
consolidated Subsidiaries as at the end of such quarter and the related
unaudited consolidated and consolidating statements of income and of cash flows
for such quarter and the portion of the fiscal year through the end of such
quarter, setting forth in each case in comparative form the figures for the
previous year, certified by a Responsible Officer as being fairly stated in all
material respects (subject to normal year-end audit adjustments);
All such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or Responsible Officer, as the
case may be, and disclosed therein).
5.2 Certificates; Other Information. Furnish to the Administrative
Agent and to each Lender or, in the case of clause (f), to the relevant Lender:
(a) concurrently with the delivery of the financial statements referred
to in Section 5.1(a), a certificate of the independent certified public
accountants reporting on such financial statements stating that in making the
examination necessary therefor no knowledge was obtained of any Default or Event
of Default except as specified in such certificate;
(b) concurrently with the delivery of any financial statements pursuant
to Section 5.1, (i) a certificate of a Responsible Officer stating that, to the
best of each such Responsible Officer's knowledge, each Loan Party during such
period has observed or performed all of its covenants and other agreements, and
satisfied every condition, contained in this Agreement and the other Loan
Documents to which it is a party to be observed, performed or satisfied by it
and that such Responsible Officer has obtained no knowledge of any Default or
Event of Default except as specified in such certificate and (ii) in the case of
quarterly or annual financial statements, (x) a Compliance Certificate
containing all information necessary for determining compliance by CPI with the
provisions of this Agreement referred to therein as of the last day of the
fiscal quarter or fiscal year of CPI, as the case may be, prepared by the
Borrowers' accountants in the case of annual financial statements or by a
Responsible Officer of CPI in the case of quarterly financial statements, and
(y) to the extent not previously disclosed to the Administrative Agent, a
listing of any county or state within the United States where any Loan Party
keeps inventory or equipment and of any Intellectual Property acquired by any
Loan Party since the date of the most recent list delivered pursuant to this
clause (y) (or, in the case of the first such list so delivered, since the
Closing Date);
(c) as soon as available, and in any event no later than 90 days after
the end of each fiscal year of CPI, a detailed consolidated and consolidating
budget for the life of the Tranche A and Tranche C Term Loans (including a
projected consolidated and consolidating balance sheet of CPI and its
Subsidiaries as of the end of the following fiscal year, and the related
consolidated and consolidating statements of projected cash flow, projected
changes in financial position and projected income), and, as soon as available,
significant revisions, if any, of such budget and projections with respect to
such fiscal years (collectively, the "Projections"), which Projections shall in
each case be accompanied by a certificate of a Responsible Officer stating that
such Projections are based on reasonable estimates, information and assumptions
and that such Responsible Officer has no reason to believe that such Projections
are incorrect or misleading in any material respect;
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(d) within five days after the same are sent, copies of all financial
statements and reports which CPI sends to the holders of any class of its debt
securities or public equity securities and within five days after the same are
filed, copies of all financial statements and reports which CPI may make to, or
file with, the Securities and Exchange Commission or any successor or analogous
Governmental Authority; and
(e) promptly, such additional financial and other information as any
Lender may from time to time reasonably request.
5.3 Payment of Obligations. Pay, discharge or otherwise satisfy at or
before maturity or before they become delinquent as the case may be, all its
material obligations of whatever nature, except where the amount or validity
thereof is currently being contested in good faith by appropriate proceedings
and reserves in conformity with GAAP with respect thereto have been provided on
the books of the relevant Borrower, as the case may be.
5.4 Conduct of Business and Maintenance of Existence, etc. (a) (i)
Continue to engage in business of the same general type as now conducted by it,
(ii) preserve, renew and keep in full force and effect its corporate existence
and (iii) take all reasonable action to maintain all rights, privileges and
franchises necessary or desirable in the normal conduct of its business, except,
in each case, as otherwise permitted by Section 6.4 and except, in the case of
clause (iii) above, to the extent that failure to do so could not reasonably be
expected to have a Material Adverse Effect; and (b) comply with all Contractual
Obligations and Requirements of Law except to the extent that failure to comply
therewith could not, in the aggregate, reasonably be expected to have a Material
Adverse Effect.
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5.5 Maintenance of Property, Insurance. (a) Keep all Property useful
and necessary in its business in good working order and condition, ordinary wear
and tear excepted, (b) maintain with financially sound and reputable insurance
companies insurance on all its Property in at least such amounts and against at
least such risks (but including in any event fire, public liability, product
liability, employee fidelity and business interruption) as are usually insured
against in the same general area by companies engaged in the same or a similar
business or as shall be reasonably required by the Administrative Agent and (c)
deliver to the Administrative Agent and the Lenders a report of a reputable
insurance broker with respect to such insurance concurrently with each delivery
of audited annual financial statements pursuant to Section 5.1 and such
supplemental reports with respect thereto as the Administrative Agent may from
time to time reasonably request
5.6 Inspection of Property, Books and Records; Discussions. (a) Keep
proper books of records and account in which full, true and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to its business and activities and (b) upon notice
given reasonably in advance permit representatives of any Lender to visit and
inspect any of its properties and examine and make abstracts from any of its
books and records at any reasonable time and as often as may reasonably be
desired and to discuss the business, operations, properties and financial and
other condition of the Borrowers or any of their Subsidiaries with officers and
employees of the Borrowers and their Subsidiaries and with their independent
certified public accountants. The aforementioned inspection rights shall include
asset reviews of the books and records of the Borrowers to be performed by
representatives of the Administrative Agent as required by the Administrative
Agent and the Lenders in their sole discretion. The reasonable costs and
expenses for one such asset review per year shall be for the account of the
Borrowers. If there shall occur a Default or Event of Default, additional asset
reviews, as required by the Required Lenders, shall be performed, the reasonable
costs and expenses of which shall be for the account of the Borrowers.
5.7 Notices. Promptly give notice to the Administrative Agent and each
Lender of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any Contractual
Obligation of either Borrower or any of its Subsidiaries or (ii) litigation,
investigation or proceeding which may exist at any time between the Borrowers or
any of their Subsidiaries and any Governmental Authority, which in either case,
if not cured or if adversely determined, as the case may be, could reasonably be
expected to have a Material Adverse Effect;
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(c) any litigation or proceeding affecting the Borrowers or any of
their Subsidiaries in which the amount involved is $25,000 or more and not
covered by insurance or in which injunctive or similar relief is sought;
(d) the following events, as soon as possible and in any event within
30 days after either Borrower knows or has reason to know thereof. (i) the
occurrence of any Reportable Event with respect to any Plan, a failure to make
any required contribution to a Plan, the creation of any Lien in favor of the
PBGC or a Plan or any withdrawal from, or the termination, Reorganization or
Insolvency of, any Multiemployer Plan or (ii) the institution of proceedings or
the taking of any other action by the PBGC or either Borrower or any Commonly
Controlled Entity or any Multiemployer Plan with respect to the withdrawal from,
or the termination, Reorganization or Insolvency of, any Plan; and
(e) any development or event which has had or could reasonably be
expected to have a Material Adverse Effect.
Each notice pursuant to this Section 5.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the relevant Borrower or the relevant Subsidiary
proposes to take with respect thereto.
5.8 Environmental Laws. (a) Comply in all material respects with, and
ensure compliance in all material respects by all tenants and subtenant, if any,
with, all applicable Environmental Laws, and obtain and comply in all material
respects with and maintain, and ensure that all tenants and subtenants obtain
and comply in all material respects with and maintain, any and all licenses,
approvals, notifications, registrations or permits required by applicable
Environmental Laws.
(b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding Environmental
Laws.
5.9 Additional Collateral, etc. (a) With respect to any Property
acquired after the Closing Date by either Borrower or any of its Subsidiaries
(other than (x) any Property described in paragraph (b) or (c) below and (y) any
Property subject to a Lien expressly permitted by Section 6.3(g)) as to which
the Administrative Agent, for the benefit of the Lenders, does not have a
perfected Lien, promptly (i) execute and deliver to the Administrative Agent
such amendments to the Guarantee and Collateral Agreement or such other
documents as the Administrative Agent deems necessary or advisable in order to
grant to the Administrative Agent, for the benefit of the Lenders, a security
interest in such Property and (ii) take all actions necessary or advisable to
grant to the Administrative Agent, for the benefit of the Lenders, a perfected
first priority security interest in such Property, including without limitation,
the filing of Uniform Commercial Code financing statements in such jurisdictions
as may be required by the Guarantee and Collateral Agreement or by law or as may
be requested by the Administrative Agent.
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(b) With respect to any fee interest in any real estate acquired after
the Closing Date by either Borrower or any of its Subsidiaries (other than any
such real estate subject to a Lien expressly permitted by Section 6.3(g)),
promptly (i) execute and deliver a first priority mortgage or deed of trust, as
the case may be, in favor of the Administrative Agent for the benefit of the
Lenders, covering such real estate, in form and substance reasonably
satisfactory to the Administrative Agent (ii) if requested by the Administrative
Agent provide the Lenders with (k) title and extended coverage insurance
covering such real estate in an amount at least equal to the purchase price of
such real estate (or such other amount as shall be reasonably specified by the
Administrative Agent) as well as a current ALTA survey thereof, together with a
surveyor's certificate and (y) any consents or estoppels reasonably deemed
necessary or advisable by the Administrative Agent in connection with such
mortgage or deed of trust each of the foregoing in form and substance reasonably
satisfactory to the Administrative Agent and (iii) if requested by the
Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.
(c) With respect to any new Subsidiary created or acquired after the
Closing Date by either Borrower or any of its Subsidiaries, promptly (i) execute
and deliver to the Administrative Agent (x) such amendments to the Guarantee and
Collateral Agreement as. the Administrative Agent deems necessary or advisable
in order to grant to the Administrative Agent, for the benefit of the Lenders, a
perfected first priority security interest in the Capital Stock of such new
Subsidiary which is owned by either Borrower or any of its Subsidiaries and (y)
such amendments to this Agreement as shall be deemed necessary by the
Administrative Agent to reflect the existence of such Subsidiary, (ii) deliver
to the Administrative Agent the certificates representing such Capital Stock,
together with undated stock powers, in blank, executed and delivered by a duly
authorized officer of the Loan Party owning such certificates or such
Subsidiary, as the case may be, (iii) cause such new Subsidiary (A) to become a
party to the Guarantee and Collateral Agreement and (B) to take such actions
necessary or advisable to grant to the Administrative Agent for the benefit of
the Lenders a perfected first priority security interest in the Collateral
described in the Guarantee and Collateral Agreement with respect to such new
Subsidiary, including, without limitation, the filing of Uniform Commercial Code
financing statements in such jurisdictions as may be required by the Guarantee
and Collateral Agreement or by law or as may be requested by the Administrative
Agent, and (iv) if requested by the Administrative Agent, deliver to the
Administrative Agent legal opinions relating to the matters described above,
which opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Administrative Agent.
SECTION 6. NEGATIVE COVENANTS
The Borrowers hereby jointly and severally agree that so long as the
Commitments remain in effect, or any Loan or other amount is owing to any Lender
or the Administrative Agent hereunder, each Borrower shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly:
34
6.1 Financial Condition Covenants.
(a) Consolidated Tangible Net Worth. Permit the Consolidated Tangible
Net Worth deficit to exceed the amounts set forth below at the end of each of
the indicated fiscal quarters:
Quarter ending 6/30/02 ($1,500,000)
Quarter ending 9/30/02 ($1,000,000)
Quarter ending 12/31/02 ($ 500,000)
Quarter ending 3/31/03 ($ 250,000)
(b) Fixed Charges Coverage Ratio. Permit the Fixed Charges Coverage
Ratio to be less than the indicated amount during any of the indicated fiscal
quarters.
Quarter ending 6/30/02 1.33X
Quarter ending 9/30/02 1.50X
Quarter ending 12/31/02 1.50X
Quarter ending 3/31/03 1.33X
(c) Consolidated Net Income. Permit Consolidated Net Income to be less
than the indicated amount during any of the indicated fiscal quarters:
Quarter ending 6/30/02 $250,000
Quarter ending 9/30/02 $500,000
Quarter ending 12/31/02 $500,000
Quarter ending 3/31/03 $250,000
(d) EBITDA. Permit EBITDA to be less than the indicated amount during
any of the indicated fiscal quarters:
Quarter ending 6/30/02 $800,000
Quarter ending 9/30/02 $900,000
Quarter ending 12/31/02 $900,000
Quarter ending 3/31/03 $800,000
6.2 Limitation on Indebtedness. Create, Incur, assume or suffer to
exist any Indebtedness, except:
(a) Indebtedness of any Loan Party pursuant to any Loan Document; and
(b) Indebtedness secured by Liens permitted by Section 6.3(g).
35
6.3 Limitation on Liens. Create, Incur, assume or suffer to exist any
Lien upon any of its Property or revenues, whether now owned or hereafter
acquired, except for:
(a) Liens for taxes not yet due or which are being contested in good
faith by appropriate proceedings, provided that adequate reserves with respect
thereto are maintained on the books of the relevant Borrower or its
Subsidiaries, as the case may be, in conformity with GAAP;
(b) carriers', warehousemen's, mechanics', materialmen's, repairmen's
or other like Liens arising in the ordinary course of business which are not
overdue for a period of more than 30 days or which are being contested in good
faith by appropriate proceedings;
(c) pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation;
(d) deposits to secure the performance of bids, trade contracts (other
than for borrowed money), leases, statutory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature Incurred in the
ordinary course of business;
(e) easements, rights-of-way, restrictions and other similar
encumbrances Incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount and which do not in any case materially
detract from the value of the Property subject thereto or materially interfere
with the ordinary conduct of the business of CPI or any of its Subsidiaries;
(f) Liens in existence on the date hereof listed on Schedule 6.3(f)
(g) Liens securing Indebtedness of CPI or any of its Subsidiaries
Incurred pursuant to Section 6.2(b) to finance the acquisition of fixed or
capital assets, provided that (i) such Liens shall be created substantially
simultaneously with the acquisition of such fixed or capital assets, (ii) such
Liens do not at any time encumber any Property other than the Property financed
by such Indebtedness, (iii) the amount of Indebtedness secured thereby is not
increased and (iv) the principal amount of such Indebtedness shall not exceed
100% of the purchase price of such assets;
(h) Liens created pursuant to the Security Documents or the Seller
Security Documents; and
(i) any interest or title of a lessor under any lease entered into by a
Borrower or any of its Subsidiaries in the ordinary course of its business and
covering only the assets so leased.
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6.4 Limitation on Fundamental Changes. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or Dispose of, all or substantially all
of its Property or business, or make any material change in its present method
of conducting business, except:
(a) any Subsidiary of a Borrower may be merged or consolidated with or
into CPI (provided that CPI shall be the continuing or surviving corporation);
and
(b) any Subsidiary of a Borrower may Dispose of any or all of its
assets (upon voluntary liquidation or otherwise) to CPI.
6.5 Limitation on Sale of Assets. Dispose of any of its Property or
business (including, without limitation, receivables and leasehold interests),
whether now owned or hereafter acquired, or, in the case of any Subsidiary,
issue or sell any shares of such Subsidiary's Capital Stock to any Person,
except:
(a) (i) the Disposition of obsolete or worn out property in the
ordinary course of business and (ii) the sale of receivables in the ordinary
course of business to collection agencies for the purpose of collecting overdue
amounts owing in respect thereof, so long as the aggregate value of all Property
sold pursuant to this paragraph (a) does not exceed $10,000 in any fiscal year
of CPI;
(b) the sale of inventory in the ordinary course of business; and
(c) Dispositions permitted by Section 6.4(b).
6.6 Limitation on Dividends. Declare or pay any dividend on, or make
any payment on account of, or set apart assets for a sinking or other analogous
fund for, the purchase, redemption, defeasance, retirement or other acquisition
of, any shares of any class of Capital Stock of either Borrower or any
Subsidiary or any warrants or options to purchase any such Capital Stock,
whether now or hereafter outstanding, or make any other distribution in respect
thereof, either directly or indirectly, whether in cash or property or in
obligations of CPI or any of its Subsidiaries (collectively, "Restricted
Payments"), except that any Subsidiary may make Restricted Payments to CPI.
6.7 Limitation on Capital Expenditures. Make or commit to make (by way
of the acquisition of securities of a Person or otherwise) any Capital
Expenditure, except Capital Expenditures of CPI and its Subsidiaries in the
ordinary course of business not exceeding $100,000 in the aggregate in any
fiscal year of CPI.
6.8 Limitation on Investments, Loans and Advances. Make any advance,
loan, extension of credit (including by way of guaranty in favor of third
parties) or capital contribution to, or purchase any stock, bonds, notes,
debentures or other securities of or any assets constituting all or a material
part of a business unit of, or make any other investment in, any Person, except
(a) extensions of trade credit in the ordinary course of business;
(b) investments in Cash Equivalents; and
(c) Guarantee Obligations permitted by Section 6.2(a) or 6.2(d);
37
6.9 Limitation on Payments and Modifications with respect to Seller
Note, Seller Security Documents. (a) Make or offer to make any optional payment,
prepayment, repurchase or redemption of or otherwise defease or segregate funds
with respect to any Indebtedness (other than Indebtedness under any Loan
Document), or (b) amend, modify, waive or otherwise change, or consent or agree
to any amendment, modification, waiver or other change to, any of the terms of
the Seller Note or the Seller Security Documents.
6.10 Limitation on Transactions with Affiliates. Enter into any
transaction, including, without limitation, any purchase, sale, lease or
exchange of Property, the rendering of any service or the payment of any
management, advisory or similar fees, with any Affiliate (other than a Borrower)
unless such transaction is (a) otherwise permitted under this Agreement, (b) in
the ordinary course of business of a Borrower or any Subsidiary, as the case may
be, and (c) upon fair and reasonable terms no less favorable to the Borrower or
such Subsidiary, as the case may be, than it would obtain in a comparable arm's
length transaction with a Person which is not an Affiliate. The preceding
sentence shall not apply to a non-interest bearing loan made to Xxxxxx August in
October, 2000 in the amount of $150,000, which Mr. August used to purchase a
Greit Plan, as described in the report of CPI on form 10-K for the year ended
December 31, 2000.
6.11 Limitation on Sales and Leasebacks. Enter into any arrangement
with any Person providing for the leasing by a Borrower or any Subsidiary of
real or personal property which has been or is to be sold or transferred by a
Borrower or such Subsidiary to such Person or to any other Person to whom funds
have been or are to be advanced by such Person on the security of such property
or rental obligations of a Borrower or such Subsidiary.
6.12 Limitation on Changes in Fiscal Periods. Permit the fiscal year of
a Borrower to end on a day other dm December 31 or change a Borrower's method of
determining fiscal quarters.
6.13 Limitation on Negative Pledge Clauses. Enter into or suffer to
exist or become effective any agreement which prohibits or limits the ability of
a Borrower or any of its Subsidiaries to create, Incur, assume or suffer to
exist any Lien upon any of its Property or revenues, whether now owned or
hereafter acquired, other than (a) this Agreement and the other Loan Documents
and (b) any agreements governing any purchase money Liens otherwise permitted
hereby (in which case, any prohibition or limitation shall only be effective
with respect to the assets financed thereby).
6.14 Limitation on Restrictions on Subsidiary Distributions. Enter into
or suffer to exist or become effective any consensual encumbrance or restriction
on the ability of any Subsidiary of a Borrower to (a) pay dividends or make any
other distributions in respect of any Capital Stock of such Subsidiary held by,
or pay any Indebtedness owed to, such Borrower or the other Borrower or
Subsidiary of such Borrower or the other Borrower, (b) make loans or advances to
a Borrower or any Subsidiary of such Borrower or to the other Borrower or
Subsidiary of such other Borrower or (c) transfer any of its assets to a
Borrower or any other Subsidiary of the Borrower or to the other Borrower or
Subsidiary of such other Borrower, except for such encumbrances or restrictions
existing under the Loan Documents.
38
6.15 Limitation on Lines of Business. Enter into any business, either
directly or through any Subsidiary, except for those businesses in which either
the Borrowers are engaged on the date of this Agreement or which are reasonably
related thereto.
6.16 Limitation on Change in Accounting Treatment. Change its
accounting treatment or reporting practices except as required by changes in
GAAP.
SECTION 7. EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) The Borrowers shall fail to pay (i) any principal of any Loan when
due in accordance with the terms hereof and (ii) any interest thereon or any
other amount payable hereunder or under any other Loan Document within two
business days after such payment is due in accordance with the terms hereof or
thereof; or
(b) Any representation or warranty made or deemed made by any Loan
Party herein or in any other Loan Document or which is contained in any
certificate, document or financial or other statement furnished by it at any
time under or in connection with this Agreement or any such other Loan Document
shall prove to have been inaccurate in any material respect on or as of the date
made or deemed made; or
(c) (i) Any Loan Party shall default in the observance or performance
of any other agreement contained in this Agreement or any other Loan Document
(other than as provided in paragraph (a) or (b) of this Section) or (ii) an
"Event of Default" under and as defined in any Mortgage shall have occurred and
be continuing; or
39
(d) Either Borrower or any of its Subsidiaries shall (i) default in
making any payment of any principal of any Indebtedness (including, without
limitation, any Guarantee Obligation, but excluding the Loans) on the scheduled
or original due date with respect thereto; or (ii) default in making any payment
of any interest on any such Indebtedness beyond the period of grace, if any,
provided in the instrument or agreement under which such Indebtedness was
created; or (iii) default in the observance or performance of any other
agreement or condition relating to any such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other
event shall occur or condition exist the effect of which default or other event
or condition is to cause, or to permit the holder or beneficiary of such
Indebtedness (or a trustee or agent on behalf of such holder or beneficiary) to
cause, with the giving of notice if required, such Indebtedness to become due
prior to its stated maturity or (in the case of any such Indebtedness
constituting a Guarantee Obligation) to become payable; provided, that a
default, event or condition described in clause (i), (ii) or (iii) of this
paragraph (e) shall not at any time constitute an Event of Default under this
Agreement unless, at such time, one or more defaults, events or conditions of
the type described in clauses (i), (ii) and (iii) of this paragraph (e) shall
have occurred and be continuing with respect to Indebtedness the outstanding
principal amount of which exceeds in the aggregate $25,000; or
(e) (i) Either Borrower or any of its Subsidiaries shall commence any
case, proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its assets, or
either Borrower or any of its Subsidiaries shall make a general assignment for
the benefit of its creditors; or (ii) there shall be commenced either Borrower
or any of its Subsidiaries any case, proceeding or other action of a nature
referred to in clause (i) above which (A) results in the entry of an order for
relief or any such adjudication or appointment or (B) remains undismissed,
undischarged or unbonded for a period of 60 days; or (iii) there shall be
commenced against either Borrower or any of its Subsidiaries any case,
proceeding or other action seeking issuance of a warrant of attachment
execution, distraint or similar process against all or any substantial part of
its assets which results in the entry of an order for any such relief which
shall not have been vacated, discharged, or stayed or bonded pending appeal
within 60 days from the entry thereof; or (iv) either Borrower or any of its
Subsidiaries shall take any action in furtherance of, or indicating its consent
to, approval of, or acquiescence in, any of the acts set forth in clause (i),
(ii), or (iii) above; or (v) either Borrower or any of its Subsidiaries shall
generally not, or shall be unable to, or shall admit in writing its inability
to, pay its debts as they become due; or
(f) (i) Any Person shall engage in any "prohibited transaction" (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan,
(ii) any "accumulated funding deficiency" (as defined in Section 302 of ERISA),
whether or not waived, shall exist with respect to any Plan or any Lien in favor
of the PBGC or a Plan shall arise on the assets of the Borrowers or any Commonly
Controlled Entity, (iii) a Reportable Event shall occur with respect to, or
proceedings shall commence to have a trustee appointed, or a trustee shall be
appointed, to administer or to terminate, any Single Employer Plan, which
Reportable Event or commencement of proceedings or appointment of a trustee is,
in the reasonable opinion of the Required Lenders, likely to result in the
termination of such Plan for purposes of Title IV of ERISA, (iv) any Single
Employer Plan shall terminate for purposes of Title IV of ERISA, (v) the
Borrowers or any Commonly Controlled Entity shall, or in the reasonable opinion
of the Required Lenders is likely to, Incur any liability in connection with a
withdrawal from, or the Insolvency or Reorganization of, a Multiemployer Plan or
(vi) any other event or condition shall occur or exist with respect to a Plan;
and in each case in clauses (i) through (vi) above, such event or condition,
together with all other such events or conditions, if any, could, in the sole
judgment of the Required Lenders, reasonably be expected to have a Material
Adverse Effect; or
40
(g) One or more judgments or decrees shall be entered against either of
the Borrowers or any of its Subsidiaries involving in the aggregate a liability
(not paid or fully covered by insurance as to which the relevant insurance
company has acknowledged coverage) of $50,000 or more, and all such judgments or
decrees shall not have been vacated, discharged, stayed or bonded pending appeal
within 30 days from the entry thereof, or
(h) Any of the Security Documents shall cease, for any reason, to be in
full force and effect, or any Loan Party or any Affiliate of any Loan Party
shall so assert, or any Lien created by any of the Security Documents shall
cease to be enforceable and of the same effect and priority purported to be
created thereby; or
(i) The guarantee referred to in Section 9 hereof or in Section 2 of
the Guarantee and Collateral Agreement shall cease, for any reason, to be in
full force and effect or any Loan Party or any Affiliate of any Loan Party shall
so assert; or
(j) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act")), shall become, or obtain rights (whether by means or wan-ants, options or
otherwise) to become, the "beneficial owner" (as defined in Rules 13(d)-3 and
13(d)-5 under the Exchange Act), directly or indirectly, of more than 5% of the
outstanding common stock of CPI; (ii) the board of directors of CPI shall cease
to consist of a majority of Continuing Directors; (iii) CPI shall cease to own
and control, of record and beneficially, directly, 100% of each class of
outstanding Capital Stock of Xxxxx, Inc. free and clear of all Liens (except
Liens created by the Guarantee and Collateral Agreement); or (iv) any direct or
indirect parent of either Borrower (other than CPI) shall be created unless (x)
such parent becomes a party to the Guarantee and Collateral Agreement as a
guarantor and a grantor and (y) such amendments to the Loan Documents as the
Required Lenders shall request shall be entered into (including, in any event,
amendments subjecting such parent and its subsidiaries to the covenants
contained herein); or
(k) the Seller Note or any guarantee thereof shall cease, for any
reason, to be validly subordinated to the obligations of the relevant Loan Party
under the Loan Documents to which it is a party to the extent provided in the
Seller Intercreditor and Subordination Agreement or the Seller, any Loan Party
or any of their respective Affiliates shall so assert;
(l) the Tranche C Term Loan shall cease, for any reason, to be validly
subordinated to the obligations of Borrowers under the Tranche A and Tranche B
Loans to the extent provided in the Tranche C Intercreditor and Subordination
Agreement or the holder of the Tranche C Term Loan, any Loan Party or any of
their respective Affiliates shall so assert;
then, and in any such event, (A) if such event is an Event of Default specified
in paragraph (e) above with respect to either Borrower, automatically the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement and the other Loan Documents shall immediately become due and payable,
and (B) if such event is any other Event of Default, upon the request of the
Required Lenders, the Administrative Agent shall by notice to the Borrowers,
declare the Loans hereunder (with accrued interest thereon) and all other
amounts owing under this Agreement and the other Loan Documents to be due and
payable forthwith, together with, in the case of the Tranche B Term Loans, the
Prepayment Premium, whereupon the same shall immediately become due and payable.
Except as expressly provided above in this Section, presentment, demand, protest
and all other notices of any kind are hereby expressly waived by the Borrowers.
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SECTION 8. THE ADMINISTRATIVE AGENT
8.1 Appointment. Each Lender hereby irrevocably designates and appoints
the Administrative Agent as the agent of such Lender under this Agreement and
the other Loan Documents, and each such Lender irrevocably authorizes the
Administrative Agent, in such capacity, to take such action on its behalf under
the provisions of this Agreement and the other Loan Documents and to exercise
such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent.
8.2 Delegation of Duties. The Administrative Agent may execute any of
its duties under this Agreement and the other Loan Documents by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or attorneys
in-fact selected by it with reasonable care.
8.3 Exculpatory Provisions. Neither the Administrative Agent nor any of
its respective officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Loan Document (except to the extent that any of the foregoing are found by
a final and nonappealable decision of a court of competent jurisdiction to have
resulted from its or such Person's own gross negligence or willful misconduct)
or (ii) responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by any Loan Party or any officer
thereof contained in this Agreement or any other Loan Document or in any
certificate, report, statement or other document referred to or provided for in,
or received by the Administrative Agent under or in connection with, this
Agreement or any other Loan Document or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document or for any failure of any Loan Party a party thereto to perform its
obligations hereunder or thereunder. The Administrative Agent shall not be under
any obligation to any Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement or any other Loan Document or to inspect the properties, books or
records of any Loan Party.
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8.4 Reliance by Administrative Agent. The Administrative, Agent shall
be entitled to rely, and shall be fully protected in relying, upon any
instrument, writing, resolution, notice, consent, certificate, affidavit letter,
telecopy, telex or teletype message, statement; order or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of
legal counsel (including, without limitation, counsel the Borrowers),
independent accountants and other experts selected by the Administrative Agent.
The Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Required Lenders (or, if so specified
by this Agreement, all 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 Administrative Agent shall in all cases be fully protected
in acting, or in refraining from acting, under this Agreement and the other Loan
Documents in accordance with a request of the Required Lenders (or, if so
specified by this Agreement, all Lenders), and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders and all
future holders of the Loans.
8.5 Notice of Default. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender or
either Borrower referring to this Agreement, 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 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 (or, if so specified by this Agreement, all
Lenders); provided that unless and until the Administrative Agent shall have
received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable in the best
interests of the Lenders.
8.6 Non-Reliance on Administrative Agent and Other Lenders. Each Lender
expressly acknowledges that neither the Administrative Agents nor any of its
respective officers, directors, employees, agents, attorneys-in-fact or
affiliates have made any representations or warranties to it and that no act by
the Administrative Agent hereinafter taken, including any review of the affairs
of a Loan Party or any affiliate of a Loan Party, shall be deemed to constitute
any representation or warranty by the Administrative Agent to any Lender. Each
Lender represents to the Administrative Agent that it has, independently and
without reliance upon the Administrative Agent 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, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon the Administrative Agent or any other Lender, and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Loan Parties and their affiliates. Except for notices, reports and other
documents expressly required to be furnished to tile Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of any Loan Party or any affiliate of
a Loan Party which may come into the possession of the Administrative Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.
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8.7 Indemnification. The Lenders agree to indemnify the Administrative
Agent in its capacity as such (to the extent not reimbursed by the Borrowers and
without limiting the obligation the Borrowers to do so), ratably according to
their respective Tranche A Term Loan Percentages and Tranche B Term Loan
Percentages in effect on the date on which indemnification is sought under this
Section 8.7 (or, if indemnification is sought after the Loans shall have been
paid in full, ratably in accordance with such Percentages immediately prior to
such date), 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 the payment of the Loans) be imposed on, Incurred by or
asserted against the Administrative Agent in any way relating to or arising out
of, the Commitments made pursuant to the Original Credit Agreement, this Amended
and Restated Credit Agreement, any of the other Loan 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 the
Administrative 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 which are found by a final and nonappealable
decision of a court of competent jurisdiction to have resulted from the
Administrative Agent's gross negligence or willful misconduct. The agreements in
this Section 8.7 shall survive the payment of the Loans and all other amounts
payable hereunder.
8.8 Administrative Agent in Its Individual Capacity. The Administrative
Agent and its affiliates may make loans to, accept deposits from and generally
engage in any kind of business with any Loan Party as though the Administrative
Agent was not the Administrative Agent. With respect to its Loans made or
renewed by it and with respect to any Letter of Credit issued or participated in
by it, the Administrative Agent shall have the same rights and powers under this
Agreement and the other Loan Documents as any Lender and may exercise the same
as though it were not the Administrative Agent, and the terms "Lender" and
"Lenders" shall include the Administrative Agent in its individual capacity.
44
8.9 Successor Administrative Agent. The Administrative Agent may resign
as Administrative Agent upon 10 days' notice to the Lenders and the Borrowers.
If the Administrative Agent shall resign as Administrative Agent under this
Agreement and the other Loan Documents, then the Required Lenders shall appoint
from among the Lenders a successor agent for the Lenders, whereupon such
successor agent shall succeed to the rights, powers and duties of the
Administrative Agent, and the term "Administrative Agent" shall mean such
successor agent effective upon such appointment and approval, and the former
Administrative Agent's rights, powers and duties as Administrative Agent shall
be terminated, without any other or further act or deed on the part of such
former Administrative Agent or any of the parties to this Agreement or any
holders of the Loans. If no successor agent has accepted appointment as
Administrative Agent by the date that is 10 days following a retiring
Administrative Agent's notice of resignation, the retiring Administrative
Agent's resignation shall nevertheless thereupon become effective and the
Lenders shall assume and perform all of the duties of the Administrative Agent
hereunder until such time, if any, as the Required Lenders appoint a successor
agent as provided for above. After any retiring Administrative Agent's
resignation as Administrative Agent, the provisions of this Section 8 shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Administrative Agent under this Agreement and the other Loan Documents.
8.10 Authorization to Release Liens. The Administrative Agent is hereby
irrevocably authorized by each of the Lenders to release any Lien covering any
Property of CPI or any of its Subsidiaries that is the subject of a Disposition
which is permitted by this Agreement or which has been consented to in
accordance with Section 10.1.
SECTION 9. PRIOR GUARANTEE
9.1 Continued Effect of Prior Guarantee. All of the provisions set
forth in Section 9 of the Original Credit Agreement shall continue in full force
and effect with respect to any and all obligations of CPI and/or Xxxxx, Inc.
Incurred pursuant to the Original Credit Agreement and/or any of the Loan
Documents executed in connection therewith, including but not limited to any and
all amendments to and waivers issued by the Administrative Agent and/or any of
the Lenders with respect to the Original Credit Agreement. Nothing in this
Amended and Restated Credit Agreement shall be deemed to release CPI of any of
its obligations under Section 9.1 of the Original Credit Agreement as in effect
prior to the date hereof and/or its Guarantor Obligations (as defined in the
Guarantee and Collateral Agreement) in respect of any act, occurrence, Event of
Default, obligation or other matter arising on or before the date hereof.
9.2 CPI and Xxxxx, Inc. as Co-Borrowers. Notwithstanding the foregoing,
from and after the date of this Amended and Restated Credit Agreement, CPI is
becoming a co-borrower with Xxxxx, Inc. in respect of each of the Loans and
shall have direct, joint and several liability with Xxxxx, Inc. for payment of
all of the Obligations.
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9.3 No Subrogation Contribution, Reimbursement or Indemnity. Notwithstanding
anything to the contrary in this Section 9, each Borrower hereby irrevocably
waives all rights, if any, which may hereafter arise in favor of one Borrower
for contribution from the other Borrower in respect of the payment of any
Obligation hereunder to be subrogated to any of the rights (whether contractual,
under the United States Bankruptcy Code (or similar action under any successor
law or under any comparable law), including Section 509 thereof, under common
law or otherwise) of the Administrative Agent or any Lender against either
Borrower or against the Administrative Agent or any Lender for the payment of
the Obligations, until the Obligations shall have been paid in full. Each
Borrower hereby further irrevocably waives all contractual, common law,
statutory and other rights of reimbursement, contribution, exoneration or
indemnity (or any similar right) from or against the other Borrower or any other
Person which may have arisen in connection with the payment by such Borrower of
any of the Obligations, until the Obligations shall have been paid in full. So
long as the Obligations remain outstanding, if any amount shall be paid by or on
behalf of a Borrower to the other Borrower on account of any of the rights
waived in this Section 9.2, such amount shall be held by the Borrower receiving
such payment in trust, segregated from other funds of such Borrower, and shall,
forthwith upon such receipt be turned over to the Administrative Agent in the
exact form received (duly indorsed by the recipient to the Administrative Agent,
if required), to be applied against the Obligations, whether matured or
unmatured, in such order as the Administrative Agent may determine. The
provisions of this Section 9.2 shall survive the term of this Agreement and the
payment in full of the Obligations.
SECTION 10. MISCELLANEOUS
10.1 Amendments and Waivers. Neither this Agreement, any other Loan
Document, Security Document or Seller Security Document (collectively
"Transaction Documents") nor any terms hereof or thereof may be amended,
supplemented or modified except in accordance with the provisions of this
Section 10.1. The Required Lenders and each Loan Party that is a party to the
relevant Transaction Document may, or, with the written consent of the Required
Lenders, the Administrative Agent and each Loan Party that is a party to the
relevant Transaction Document may, from time to time, (a) enter into written
amendments, supplements or modifications hereto and to the other Transaction
Documents for the purpose of adding any provisions to this Agreement or the
other Transaction Documents or changing in any manner the rights of the Lenders
or of the Loan Parties hereunder or thereunder or (b) waive, on such terms and
conditions as the Required Lenders or the Administrative Agent, as the case may
be, may specify in such instrument, any of the requirements of this Agreement or
the other Transaction Documents or any Default or Event of Default and its
consequences; provided, however, that no such waiver and no such amendment
supplement or modification shall (i) forgive the principal amount or extend the
final scheduled date of maturity of any Loan, extend the scheduled date of any
amortization payment in respect of any Loan, reduce the stated rate of any
interest without the consent of each Lender directly affected thereby, (ii)
amend, modify or waive any provision of this Section 10.1 or reduce any
percentage specified in the definition of Required Lenders, consent to the
46
assignment or transfer by any Loan Party of any of its rights and obligations
under any Transaction Documents or release any Collateral or any guarantee of
the Obligation's, in each case without the written consent of all Lenders or
(iii) amend, modify or waive any provision of Section 8 without the consent of
the Administrative Agent. Any such waiver and any such amendment, supplement or
modification shall apply equally to each of the Lenders and shall be binding
upon the Loan Parties, the Lenders, the Administrative Agent and all future
holders of the Loans. In the case of any waiver, the Loan Parties, the Lenders
and the Administrative Agent shall be restored to their former position and
rights hereunder and under the other Loan Documents, and any Default or Event of
Default waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to any subsequent or other Default or Event of Default or
impair any right consequent thereon.
10.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered, or three Business Days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice, when
received, addressed as follows in the case of the Borrowers and the
Administrative Agent and as set forth in an administrative questionnaire
delivered to the Administrative Agent in the case of the Lenders, or to such
other address as may be hereafter notified by the respective parties hereto:
CPI: CPI Aerostructures, Inc.
000X Xxxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxx, President
Telecopier No.: (000) 000-0000
with a copy to: Xxxxxxxx Xxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx Xxxx Xxxxxx, Esq.
Telecopier No.: (000) 000-0000
The Administrative Agent: XX Xxxxxx Xxxxx Bank
000 Xxxxx Xxxxxxx Xxxx
Xxxxx 000
Xxxxxxxx, Xxx Xxxx 00000 Attn:
Relationship Manager -
CPI Aerostructures, Inc.
If to the Mortgagee: JPMorgan Chase Bank
Real Estate Finance Xxxx
000 Xxxx Xxxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
47
With a copy to: JPMorgan Chase Bank
Bank Legal Department
000 Xxxx Xxxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
provided that any notice, request or demand to or upon the Administrative Agent
or the Lenders shall not be effective until received.
10.3 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Lender, any
right, remedy, power or privilege hereunder or under the other Loan Documents
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.
10.4 Survival of Representations and Warranties. All representations
and warranties made hereunder, in the other Loan Documents and in any document
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of the
Loans hereunder.
10.5 Payment of Expenses and Taxes. The Borrower agrees (a) to pay or
reimburse the Administrative Agent for all its out-of-pocket costs and expenses
Incurred in connection with the development, preparation and execution of, and
any amendment, supplement or modification to, this Agreement and the other Loan
Documents and any other documents prepared in connection herewith or therewith,
and the consummation and administration of the transactions contemplated hereby
and thereby, including, without limitation, the reasonable fees and
disbursements of counsel to the Administrative Agent, (b) to pay or reimburse
each Lender and the Administrative Agent for all its costs and expenses Incurred
in connection with the enforcement or preservation of any rights under this
Agreement the other Loan Documents and any such other documents, including,
without limitation, the fees and disbursements of counsel (including the
allocated fees and expenses of in house counsel) to each Lender and of counsel
to the Administrative Agent (c) to pay, indemnify, and old each Lender and the
Administrative Agent harmless from, any and all recording and filing fees and
any and all liabilities with respect to, or resulting from any delay in paying,
stamp, excise and other taxes, if any, which may be payable or determined to be
payable in connection with the execution and delivery of, or consummation or
administration of any of the transactions contemplated by, or any amendment,
supplement or modification of, or any waiver or consent under or in respect of,
this Agreement, the other Loan Documents and any such other documents, and (d)
to pay, indemnify, and hold each Lender and the Administrative Agent and their
respective officers, directors, employees, affiliates, agents and controlling
persons (each, an "indemnitee") harmless from and against any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever with respect
to the execution, delivery, enforcement performance and administration of this
Agreement, the other Loan Documents and any such other documents, including,
without limitation, any of the foregoing relating to the Acquisition, the use of
proceeds of the Loans or the violation of, noncompliance with or liability
under, any Environmental Law applicable to the operations of either Borrower or
any of its Subsidiaries or any of the Properties (all the foregoing in this
clause (d), collectively, the "indemnified liabilities"), provided, that the
Borrower shall have no obligation hereunder to any indemnitee with respect to
indemnified liabilities to the extent such indemnified liabilities are found by
a final and nonappealable decision of a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of such indemnitee. The
agreements in this Section 10.5 shall survive repayment of the Loans and all
other amounts payable hereunder.
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10.6 Successors and Assigns; Participations and Assignments. (a) This
Agreement shall be binding upon and inure to the benefit of either Borrower, the
Lenders, the Administrative Agent, all future holders of the Loans and their
respective successors and assigns, except that the Borrower may not assign or
transfer any of its rights or obligations under this Agreement without the prior
written consent of each Lender.
(b) Any Lender may, without the consent of the Borrower, in accordance
with applicable law, at any time sell to one or more banks, financial
institutions or other entities (each, a "Participant") participating interests
in any Loan owing to such Lender, or any other interest of such Lender hereunder
and under the other Loan Documents. In the event of any such sale by a Lender of
a participating interest to a Participant, such Lender's obligations under this
Agreement to the other parties to this Agreement shall remain unchanged, such
Lender shall remain solely responsible for the performance thereof, such Lender
shall remain the holder of any such Loan for all purposes under this Agreement
and the other Loan Documents, and the Borrower and the Administrative Agent
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement and the other Loan
Documents. In no event shall any Participant under any such participation have
any right to approve any amendment or waiver of any provision of any Loan
Document, or any consent to any departure by any Loan Party therefrom, except to
the extent that such amendment, waiver or consent would reduce the principal of
or interest on, the Loans, or postpone the date of the final maturity of the
Loans, in each case to the extent subject to such participation. The Borrower
agrees that if amounts outstanding under this Agreement and the Loans are due or
unpaid, or shall have been declared or shall have become due and payable upon
the occurrence of an Event of Default, each Participant shall to the maximum
extent permitted by applicable law, be deemed to have the right of setoff in
respect of its participating interest in amounts owing under this Agreement to
49
the same extent as if the amount of its participating interest were owing
directly to it as a Lender under this Agreement, provided that, in purchasing
such participating interest, such Participant shall be deemed to have agreed to
share with the Lenders the proceeds thereof as provided in Section 103(a) as
fully as if it were a Lender hereunder. The Borrower also agrees that each
Participant shall be entitled to the benefits of Section 2.10 with respect to
its participation in the Commitments and the Loans outstanding from time to time
as if it was a Lender; provided that such Participant shall have complied with
the requirements of said Section and provided, further, that no Participant
shall be entitled to receive any greater amount pursuant to any such Section
than the transferor Lender would have been entitled to receive in respect of the
amount of the participation transferred by such transferor Lender to such
Participant had no such transfer occurred.
(c) Any Lender (an "Assignor") may, in accordance with applicable law,
at any time and from time to time assign to any Lender or any affiliate thereof
or to an additional bank, financial institution or other entity (an "Assignee")
all or any part of its rights and obligations under this Agreement pursuant to
an Assignment and Acceptance, substantially in the form of Exhibit N, executed
by such Assignee and such Assignor and delivered to the Administrative Agent for
its acceptance and recording in the Register. Any such assignment shall be
ratable as between the Facilities unless otherwise agreed by the Administrative
Agent. Upon such execution, delivery, acceptance and recording, from and after
the effective date determined pursuant to such Assignment and Acceptance, (x)
the Assignee thereunder shall be a party hereto and, to the extent provided in
such Assignment and Acceptance, have the rights and obligations of a Lender
hereunder with a Commitment and/or Loans as set forth therein, and (y) the
Assignor thereunder shall, to the extent provided in such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of an Assignor's rights and
obligations under this Agreement such assigning Lender shall cease to be a party
hereto). Unless requested by the Assignee and/or the Assignor, new Notes shall
not be required to be executed and delivered by the Borrower, for any assignment
which occurs at any time when any Event of Default shall have occurred and be
continuing.
(d) The Administrative Agent shall maintain at its address referred to
in Section 10.2 a copy of each Assignment and Acceptance delivered, to it and a
register (the "Register") for the recordation of the names and addresses of the
Lenders and the Commitments of, 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, each other Loan Party, the
Administrative Agent and the Lenders shall treat each Person whose name is
recorded in the Register as the owner of the Loan recorded therein for all
purposes of this Agreement.
(e) Upon its receipt of an Assignment and Acceptance executed by an
Assignor and an Assignee (and, in the case of an Assignee that is not then a
Lender or an affiliate thereof, by the Borrower and the Administrative Agent)
together with payment to the Administrative Agent of a registration and
processing fee of $3,000, the Administrative Agent shall (i) promptly accept
such Assignment and Acceptance and (ii) record the information contained therein
in the Register on the effective date determined pursuant thereto.
(f) (i) The Replacement Term Notes and the Tranche C Term Note shall in
each case be issued by the Borrowers and payable to the order of a Lender (or,
if required by such Lender, payable to such Lender or its registered assigns (an
"Alternative Note")). Each Lender is hereby authorized to record, on the
schedule annexed to and constituting a part of the relevant Note, information
regarding the relevant Loans made by such Lender, and any such recordation shall
constitute prima facie evidence of the accuracy of the information so recorded,
provided that the failure to make any such recordation or any error in such
recordation shall not affect the Borrower's obligations hereunder or under any
Note. On or prior to the effective date of an Assignment and Acceptance, the
Borrower, at its own expense, shall execute and deliver to the Administrative
Agent, in exchange for the relevant Notes, new Notes to the order of the
Assignee and, if applicable, the Assignor. Such new Notes shall be dated the
Closing Date and shall otherwise be in the form of the Notes replaced thereby.
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Any Non-U.S. Lender that could become completely exempt from
withholding of any tax, assessment or other charge or levy imposed by or on
behalf of the United States or any taxing authority thereof ("U.S. Taxes") in
respect of payment of any Obligations due to such Non-U.S. Lender under this
Agreement if the Obligations were in registered form for U.S. federal income tax
purposes may request the Borrower (through the Administrative Agent), and the
Borrower agrees thereupon, to exchange any promissory note(s) evidencing such
Obligations for an Alternative Note. Alternative Notes may not be exchanged for
promissory notes that are not Alternative Notes. Each Non-U.S. Lender that holds
Alternative Note(s) (an "Alternative Noteholder") (or, if such Alternative
Noteholder is not the beneficial owner thereof, such beneficial owner) shall
deliver to the Borrower prior to or at the time such Non-U.S. Lender becomes an
Alternative Noteholder each of the forms and certifications required by Section
2.10(b). An Alternative Note and the Obligation(s) evidenced thereby may be
assigned or otherwise transferred in whole or in part only by registration of
such assignment or transfer of such Alternative Note and the Obligation(s)
evidenced thereby on the Register (and each Alternative Note shall expressly so
provide). Any assignment or transfer of all or part of such Obligation(s) and
the Alternative Note(s) evidencing the same shall be registered on the Register
only upon surrender for registration of assignment or transfer of the
Alternative Note(s) evidencing such Obligation(s), duly endorsed by (or
accompanied by a written instrument of assignment or transfer duly executed by)
the Alternative Noteholder thereof, and thereupon one or more new Alternative
Note(s) in the same aggregate principal amount shall be issued to the designated
Assignee(s). No assignment of an Alternative Note and the Obligations evidenced
thereby shall be effective unless it has been recorded in the Register.
(g) For avoidance of doubt, the parties to this Agreement acknowledge
that the provisions of this Section 10.6 concerning assignments of Loans and
Notes relate only to absolute assignments and that such provisions do not
prohibit assignments creating security interests, including, without limitation,
any pledge or assignment by a Lender of any Loan or Note to any Federal Reserve
Bank in accordance with applicable law.
10.7 Adjustments; Set-off. (a) Except to the extent that this Agreement
provides for payments to be allocated to the Lenders under a particular Loan, if
any Lender (a "Benefitted Lender") shall at any time receive any payment of all
of pin of its Loans owing to it, or interest thereon, or receive any collateral
in respect thereof (whether voluntarily or involuntarily, by set-off, pursuant
to events or proceedings of the nature referred to in Section 7(e), or
otherwise), in a greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of such other Lender's Loans
owing to such other Lender, or interest thereon, such Benefitted Lender shall
purchase for cash from the other Lenders a participating interest in such
portion of each such other Lender's Loan owing to each such other Lender, or
shall provide such other Lenders with the benefits of any such collateral, or
the proceeds thereof, as shall be necessary to cause such Benefitted Lender to
share the excess payment or benefits of such collateral or proceeds ratably with
each of the Lenders; provided, however, that if all or any portion of such
excess payment or benefits is thereafter recovered from such Benefitted Lender,
such purchase shall be rescinded, and the purchase price and benefits returned,
to the extent of such recovery, but without interest
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(b) In addition to any rights and remedies of the Lenders provided by
law, each Lender shall have the right, without prior notice to either Borrower,
any such notice being expressly waived by the Borrowers to the extent permitted
by applicable law, upon any amount becoming due and payable by either Borrower
here-under (whether at the stated maturity, by acceleration or otherwise) to set
off and appropriate and apply against such amount any and all deposits (general
or special, time or demand, provisional or final), in any currency, and any
other credits, indebtedness or claims, in any currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured, at any time
held or owing by such Lender or any branch or agency thereof to or for the
credit or the account of either Borrower. Each Lender agrees promptly to notify
the Borrowers and the Administrative Agent after any such setoff and application
made by such Lender, provided that the failure to give such notice shall not
affect the validity of such setoff and application.
10.8 Counterparts. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts (including by
telecopy), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. A set of the copies of this Agreement
signed by all the parties shall be lodged with the Borrower and the
Administrative Agent.
10.9 Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10.10 Integration. This Agreement and the other Loan Documents
represent the agreement of the Borrowers, the Administrative Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents.
10.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK.
10.12 Submission To Jurisdiction, Waivers. Each Borrower hereby
irrevocably and unconditionally:
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(a) submits for itself and its Property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the Courts of the State of
New York, the courts of the United States of America for the Southern District
of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or proceeding may
be effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to the Borrowers, at the
address set forth in Section 10.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to effect service
of process in any other manner permitted by law or shall limit the right to xxx
in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to in
this Section 10.12 any special, exemplary, punitive or consequential damages.
10.13 Acknowledgements. Each Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;
(b) neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to such Borrower arising out of or in connection with
this Agreement or any of the other Loan Documents, and the relationship between
Administrative Agent and Lenders, on one hand, and the Borrowers, on the other
hand, in connection herewith or therewith is solely that of debtor and creditor;
and (c) no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Borrowers and the Lenders.
10.14 WAIVERS OF JURY TRIAL. EACH OF THE BORROWERS, THE ADMINISTRATIVE
AGENT AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY
JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
[The next page is the Signature Page]
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Signature Page to
Amended and Restated Credit Agreement.
Dated
June 25, 2002
IN WITNESS WHEREOF, the parties hereto have caused this
Amended and Restated Agreement to be duly executed and delivered by their proper
and duly authorized officers as of the day and year first above written.
CPI AEROSTRUCTURES, INC.
By: /s/ Xxxxxx X. Xxxx
Xxxxxx X. Xxxx, President
XXXXX, INC.
By: /s/ Xxxxxx X. Xxxx
Xxxxxx X. Xxxx, Executive Vice President
JPMORGAN CHASE BANK, as Administrative
Agent and as a Lender
By: /s/
Name:
Title:
GE CAPITAL CFE, INC., as a Lender
By: /s/
Name:
Title:
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