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EXHIBIT 10.1
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CREDIT AGREEMENT
among
ANCHOR GLASS ACQUISITION CORPORATION
VARIOUS FINANCIAL INSTITUTIONS,
BANKERS TRUST COMPANY,
as Issuing Bank,
BT COMMERCIAL CORPORATION,
as Agent and Co-Syndication Agent
and
PNC BANK, NATIONAL ASSOCIATION,
as Co-Syndication Agent and Issuing Bank
Dated as of February 5, 1997
$110,000,000
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TABLE OF CONTENTS
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ARTICLE 1. Definitions....................................................... 1
1.1 General Definitions............................................... 1
1.2 Accounting Terms and Determinations............................... 33
1.3 Other Defined Terms............................................... 33
ARTICLE 2. Revolving Loans................................................... 34
2.1 Commitments....................................................... 34
2.2 Determination of Borrowing Base................................... 34
2.3 Borrowing Mechanics............................................... 35
2.4 Settlements Among the Payments Administrator and the Lenders...... 37
2.5 Mandatory and Voluntary Payments: Mandatory and Voluntary
Reduction of Commitments....................................... 40
2.6 Payments and Computations......................................... 44
2.7 Maintenance of Account............................................ 45
2.8 Statement of Account.............................................. 45
2.9 Taxes............................................................. 46
2.10 Sharing of Payments............................................... 48
ARTICLE 3. Letters of Credit................................................. 48
3.1 Issuance of Letters of Credit..................................... 48
3.2 Terms of Letters of Credit........................................ 49
3.3 Lenders' Participation............................................ 49
3.4 Notice of Issuance................................................ 50
3.5 Payment of Amount Drawn Under Letters of Credit................... 50
3.6 Payment by Lenders................................................ 51
3.7 Nature of Issuing Bank's Duties................................... 51
3.8 Obligations Absolute.............................................. 52
ARTICLE 4. Interest, Fees and Expenses....................................... 53
4.1 Interest on Eurodollar Rate Loans................................. 53
4.2 Interest on Base Rate Loans....................................... 53
4.3 Notice of Continuation and Notice of Conversion................... 53
4.4 Interest After Default............................................ 55
4.5 Reimbursement of Expenses......................................... 55
(i)
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4.6 Unused Line Fee................................................... 56
4.7 Letter of Credit Fees............................................. 56
4.8 Other Fees and Expenses........................................... 57
4.9 Authorization to Charge Account................................... 57
4.10 Indemnification in Certain Events................................. 57
4.11 Calculations...................................................... 58
4.12 Change of Applicable Lending Office............................... 58
ARTICLE 5. Conditions Precedent.............................................. 59
5.1 Conditions to Initial Loans and Letters of Credit................. 59
(a)Execution of Agreement; Notes.................................. 59
(b)Officer's Certificate.......................................... 59
(c)Opinions of Counsel............................................ 59
(d)Security Agreement............................................. 60
(e)Collateral Access Agreements................................... 60
(f)Collection Bank Agreements; Concentration Account
Agreement................................................... 60
(g)Intercreditor Agreement........................................ 61
(h)Borrowing Base Certificate..................................... 61
(i)Equity Issuances............................................... 61
(j)Issuance of Bridge Senior Notes................................ 61
(k)Acquisition Agreement; Indemnity Agreement; Plant
Sales; etc.................................................. 62
(l)Existing Credit Agreement, etc................................. 63
(m) Approvals................................................... 63
(n)Material Adverse Change, etc................................... 64
(o)Litigation..................................................... 64
(p)Corporate Proceedings.......................................... 64
(q)Plans; Collective Bargaining Agreements; Existing
Indebtedness Agreements; Shareholders' Agreements;
Management Agreements; Employment Agreements;
Tax Sharing Agreements; Affiliate Transaction
Agreement................................................... 64
(r)Solvency Opinion............................................... 66
(s)Projections; Plant Closures, etc............................... 66
(t)Insurance Policies............................................. 66
(u)Consent Letter................................................. 66
(v)Payment of Fees................................................ 66
(w) Collateral Examination...................................... 67
(x)Environmental Reports.......................................... 67
(y)Management..................................................... 67
(ii)
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(z)U.S. Holdco Guaranty........................................... 67
(aa) O-I Assurance Agreement..................................... 67
(bb) Capital Call Agreement...................................... 67
(cc) Assignment and Assumption Agreement......................... 67
(dd) Pledge Agreement............................................ 68
(ee) Closing Expenses............................................ 68
ARTICLE 6. Representations and Warranties.................................... 69
6.1 Corporate Status.................................................. 69
6.2 Corporate Power and Authority..................................... 69
6.3 No Violation...................................................... 70
6.4 Litigation........................................................ 70
6.5 Use of Proceeds................................................... 70
6.6 Governmental Approvals............................................ 70
6.7 Investment Company Act............................................ 71
6.8 Public Utility Holding Company Act................................ 71
6.9 True and Complete Disclosure...................................... 71
6.10 Financial Condition; Financial Statements......................... 71
6.11 Locations of Offices, Records and Inventory....................... 72
6.12 Fictitious Business Names......................................... 73
6.13 Security Interests................................................ 73
6.14 Tax Returns and Payments.......................................... 73
6.15 Compliance with ERISA............................................. 74
6.16 Subsidiaries...................................................... 75
6.17 Patents, etc...................................................... 75
6.18 Compliance with Statutes, etc..................................... 75
6.19 Properties........................................................ 77
6.20 Labor Relations; Collective Bargaining Agreements................. 77
6.21 Restrictions on Subsidiaries...................................... 77
6.22 Status of Accounts................................................ 78
6.23 Material Contracts................................................ 78
6.24 Existing Indebtedness and Operating Leases........................ 78
6.25 Tax Sharing Agreements............................................ 78
ARTICLE 7. Affirmative Covenants............................................. 78
7.1 Financial Information............................................. 78
7.2 Inventory Reconciliation.......................................... 82
7.3 Corporate Franchises.............................................. 82
7.4 Compliance with Statutes, etc..................................... 82
7.5 ERISA............................................................. 83
7.6 Good Repair....................................................... 85
(iii)
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7.7 Books and Records................................................. 85
7.8 Collateral Records................................................ 86
7.9 Security Interests................................................ 86
7.10 Insurance; Casualty Loss.......................................... 86
7.11 Taxes............................................................. 87
7.12 End of Fiscal Years; Fiscal Quarters.............................. 88
7.13 Further Assurances................................................ 88
7.14 Maintenance of Corporate Separateness............................. 88
7.15 Interest Rate Agreement........................................... 88
7.16 Releases and Terminations......................................... 88
7.17 Perfection of Intellectual Property Security Interests............ 89
7.18 Payment of Certain Plan Obligations............................... 89
7.19 Name Change....................................................... 89
ARTICLE 8. Negative Covenants................................................ 89
8.1 Consolidation, Merger, Sale or Purchase of Assets, etc............ 89
8.2 Liens............................................................. 90
8.3 Indebtedness...................................................... 92
8.4 Capital Expenditures.............................................. 93
8.5 Investments....................................................... 95
8.6 Dividends, etc.................................................... 96
8.7 Transactions with Affiliates...................................... 98
8.8 Changes in Business...............................................100
8.9 Consolidated Net Worth............................................100
8.10 Working Capital Ratio.............................................101
8.11 Interest Coverage Ratio...........................................101
8.12 Pay-in-Kind Interest..............................................102
8.13 Creation of Subsidiaries..........................................102
8.14 Additional Negative Pledges.......................................102
8.15 Limitation on Voluntary Payments and Modifications of
Indebtedness; Modifications of Governing Documents,
Preferred Stock and Certain Other Agreements; etc..............103
8.16 Issuance of Stock.................................................104
8.17 Limitation on Restrictions Affecting Subsidiaries.................104
8.18 No Additional Bank Accounts.......................................104
8.19 No Excess Cash....................................................105
8.20 Operating Leases..................................................105
8.21 Plant Closing Expenses............................................105
8.22 Minimum Availability..............................................106
8.23 Headquarters Lease................................................106
8.24 Account Terms.....................................................107
(iv)
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ARTICLE 9. Events of Default and Remedies....................................107
9.1 Events of Default.................................................107
(a) Payments..........................................................107
(b) Representations, etc..............................................107
(c) Covenants.........................................................108
(d) Default Under Other Agreements....................................108
(e) Bankruptcy, etc...................................................108
(f) ERISA.............................................................109
(g) Collateral Documents..............................................110
(h) Judgments.........................................................110
(i) Change of Control.................................................110
(j) U.S. Holdco Guaranty..............................................110
(k) Technical Assistance and License Agreement........................110
(l) Canadian Holdco...................................................111
(m) Affiliate Transactions Agreement..................................111
(n) Capital Call Agreement............................................111
ARTICLE 10. The Agent.........................................................112
10.1 Appointment.......................................................112
10.2 Nature of Duties of Agent.........................................112
10.3 Lack of Reliance on Agent.........................................112
10.4 Certain Rights of the Agent.......................................113
10.5 Reliance by Agent.................................................113
10.6 Indemnification of Agent..........................................114
10.7 The Agent in its Individual Capacity..............................114
10.8 Holders of Notes..................................................114
10.9 Successor Agent...................................................114
10.10 Collateral Matters................................................115
10.11 Actions with Respect to Defaults..................................116
10.12 Delivery of Information...........................................117
10.13 Co-Syndication Agents.............................................117
ARTICLE 11. Miscellaneous.....................................................117
11.1 Submission to Jurisdiction; Waivers...............................117
11.2 Waiver of Jury Trial..............................................118
11.3 Governing Law.....................................................118
11.4 Delays: Partial Exercise of Remedies..............................118
11.5 Notices...........................................................119
11.6 Benefit of Agreement..............................................119
11.7 Confidentiality...................................................122
11.8 Indemnification...................................................123
(v)
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11.9 Entire Agreement; Successors and Assigns..........................124
11.10 Amendment or Waiver...............................................124
11.11 Nonliability of Agent and Lenders.................................124
11.12 Independent Nature of Lenders' Rights.............................125
11.13 Counterparts......................................................125
11.14 Effectiveness.....................................................125
11.15 Headings Descriptive..............................................125
11.16 Maximum Rate......................................................125
11.17 Right of Setoff...................................................126
SCHEDULE I Lenders
SCHEDULE II Chief Executive Offices, Records Locations and Inventory
Locations
SCHEDULE III Fictitious Business Names
SCHEDULE IV ERISA Matters
SCHEDULE V Environmental Matters
SCHEDULE VI Real Properties
SCHEDULE VII Collective Bargaining Agreements
SCHEDULE VIII Material Contracts
SCHEDULE IX Existing Indebtedness
SCHEDULE X Insurance
SCHEDULE XI Existing Liens
SCHEDULE XII Existing Investments
SCHEDULE XIII Bank Accounts
SCHEDULE XIV Large Accounts
SCHEDULE XV Extended Term Accounts
SCHEDULE XVI Designated Properties
EXHIBIT A Form of Revolving Note
EXHIBIT B-1 Form of Notice of Borrowing
EXHIBIT B-2 Form of Letter of Credit Request
EXHIBIT B-3 Form of Notice of Continuation
EXHIBIT B-4 Form of Notice of Conversion
EXHIBIT C-1 Form of Collection Bank Agreement
EXHIBIT C-2 Form of Concentration Account Agreement
EXHIBIT D Form of Section 2.9(b)(ii) Certificate
EXHIBIT E-1 Form of Opinion of Xxxxxx Xxxxxxx Xxxxxx & Xxxxxxx and Xxxxx Day
Xxxxxx & Xxxxx, special counsels to the Borrower
EXHIBIT E-2 Form of Opinion of Fraser & Xxxxxx, Special Counsel to Consumers
EXHIBIT E-3 Form of Opinion of White & Case
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EXHIBIT F Form of Security Agreement
EXHIBIT G Form of Collateral Access Agreement
EXHIBIT H Form of Intercreditor Agreement
EXHIBIT I Form of Officer's Certificate
EXHIBIT J Form of Consent Letter
EXHIBIT K Form of Compliance Certificate
EXHIBIT L Form of Borrowing Base Certificate
EXHIBIT M1 Form of Assignment and Assumption Agreement
EXHIBIT M2 Form of Notice of Assignment
EXHIBIT N Form of Confidentiality Agreement
EXHIBIT O Form of U.S. Holdco Guaranty
EXHIBIT P Form of O-I Assurance Agreement
EXHIBIT Q Form of Capital Call Agreement
EXHIBIT R Form of Pledge Agreement
(vii)
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THIS CREDIT AGREEMENT is entered into as of February 5, 1997,
among Anchor Glass Acquisition Corporation, a Delaware corporation (the
"Borrower"), each of those financial institutions listed from time to time on
Schedule I hereto (each, a "Lender" and, collectively, the "Lenders"), BANKERS
TRUST COMPANY, as an Issuing Bank, BT COMMERCIAL CORPORATION, acting as
Co-Syndication Agent and Agent in the manner and to the extent described in
Article 10 hereof and PNC BANK, NATIONAL ASSOCIATION, as Co-Syndication Agent
and as an Issuing Bank. Capitalized terms used and not otherwise defined herein
have the respective meanings set forth in Section 1.1 hereof.
W I T N E S S E T H :
WHEREAS, the Borrower wishes to obtain a credit facility (i) to
make payments in connection with the Transaction, (ii) for the working capital
needs and general corporate purposes of the Borrower and (iii) for the ongoing
letter of credit requirements of the Borrower; and
WHEREAS, upon the terms and subject to the conditions set forth
herein, the Lenders are willing to make available to the Borrower the credit
facility provided for herein;
NOW, THEREFORE, the parties hereto hereby agree as follows:
ARTICLE 1.
Definitions
1.1 General Definitions. As used herein, the following terms
shall have the meanings herein specified (to be equally applicable to both the
singular and plural forms of the terms defined):
Accounts shall mean, with respect to any Person, all present and
future accounts, contract rights and other rights to payment for goods sold or
leased (whether or not delivered) or for services rendered which are not
evidenced by an instrument or chattel paper, whether or not they have been
earned by performance, and any letter of credit, guarantee, security interest or
other security issued or granted to secure payment by an account debtor.
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Acquired Business shall mean the assets and liabilities of Old
Anchor Glass acquired by the Borrower pursuant to the Acquisition.
Acquisition shall mean the acquisition of certain assets and
liabilities of Old Anchor Glass by the Borrower pursuant to, and in accordance
with the terms of, the Acquisition Documents.
Acquisition Agreement shall mean the Asset Purchase Agreement,
dated as of December 18, 1996, among the Borrower, O-I and Old Anchor Glass, as
the same may be amended, modified or supplemented from time to time in
accordance with the terms hereof and thereof.
Acquisition Documents shall mean the Acquisition Agreement, the
Indemnity Agreement and all other agreements and documents relating to the
Acquisition as same may be amended, modified or supplemented from time to time
in accordance with the terms hereof and thereof.
Adjusted Certificate of Deposit Rate shall mean on any day, the
sum (rounded to the nearest 1/100 of 1%) of (1) the rate obtained by dividing
(x) the most recent weekly average dealer offering rate for negotiable
certificates of deposit with a three-month maturity in the secondary market as
published in the most recent Federal Reserve System publication entitled "Select
Interest Rates," published weekly on Form H.15 as of the date hereof, or if such
publication or a substitute containing the foregoing rate information shall not
be published by the Federal Reserve System for any week, the weekly average
offering rate determined by BTCo on the basis of quotations for such
certificates received by it from three certificate of deposit dealers in New
York of recognized standing, by (y) a percentage equal to 100% minus the stated
maximum rate of all reserve requirements as specified in Regulation D applicable
on such day to a three-month certificate of deposit in excess of $100,000 issued
by a member bank of the Federal Reserve System with deposits in excess of five
billion dollars (including, without limitation, any marginal, emergency,
supplemental, special or other reserves), plus (2) the then daily net annual
assessment rate as estimated by BTCo for determining the current annual
assessment payable by BTCo to the Federal Deposit Insurance Corporation for
insuring three month certificates of deposit.
Adjusted Eurodollar Rate shall mean, with respect to each
Interest Period for any Eurodollar Rate Loan, the rate obtained by dividing (i)
the Eurodollar Rate for such Interest Period by (ii) a percentage equal to 100%
minus the stated maximum rate (stated as a decimal) of all reserves, if any,
required by the Board of Governors of the Federal Reserve System to be
maintained by a member bank of the Federal Reserve System in New York City with
deposits in excess of five billion dollars against "Eurocurrency liabilities" as
specified in Regulation D (or against any other category of liabilities which
includes
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deposits by reference to which the interest rate on Eurodollar Rate Loans is
determined or any category of extensions of credit or other assets which
includes loans by a non-United States office of any Lender to United States
residents).
Affiliate shall mean, with respect to any Person, any entity
which directly or indirectly controls, is controlled by, or is under common
control with, such Person or any Subsidiary of such Person or any Person who is
a director or officer of such Person or any Subsidiary of such Person. For
purposes of this definition, "control" shall mean the possession, directly or
indirectly, of the power to (i) vote ten percent (10%) or more of the securities
having ordinary voting power for the election of directors of such Person or
(ii) direct or cause the direction of management and policies of that Person,
whether through the ownership of voting securities, by contract or otherwise and
either alone or in conjunction with others or any group. Neither (x) any Lender
nor any person controlling any Lender or under common control with such Lender
(including BTCo) and (y) any Lender under the Senior Credit Agreement, nor any
of their respective Subsidiaries shall be treated as an Affiliate of the
Borrower or its Subsidiaries.
Affiliate Transaction Agreement shall mean the Affiliate
Transaction Agreement dated as of the Closing Date, between Consumers, G&G
Investments, Inc., Glenshaw Glass Company, Hillsboro Glass Company, Canadian
Holdco, U.S. Holdco, I.M.T.E.C. Enterprises Inc., an Oklahoma corporation, the
Borrower and the Agent.
Agent shall mean BTCC in its capacity as Agent for the Lenders
hereunder, and shall include any successor thereof as Agent, appointed as such
pursuant to Section 10.9.
Agent Advance shall mean a Revolving Loan made by the Payments
Administrator to the Borrower pursuant to Section 2.3(c).
Agent Advance Period shall have the meaning given to such term in
Section 2.3(c).
Applicable Lending Office shall mean, with respect to each
Lender, such Lender's Eurodollar Lending Office in the case of a Eurodollar Rate
Loan and such Lender's Domestic Lending Office in the case of a Base Rate Loan.
Applicable Margin shall mean the applicable percentage set forth
below based upon (x) (i) during the period from the Closing Date until the Test
Period ended Xxxxxxxx 00, 0000, Xxxxx XXX, (xx) at any time when any Default or
Event of Default is in existence, Level IV and (iii) at any time other than
those periods referred to in clauses (i)
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and (ii) above, the Level for such Quarterly Period and (y) the Outstandings
hereunder as a percentage of the Available Borrowing Amount for such Quarterly
Period:
Outstandings Equal or Exceed
Outstandings Do Not Exceed 50% 50% of Available Borrowing
of Available Borrowing Amount Amount
----------------------------- ----------------------------
Eurodollar Base Rate Eurodollar Base Rate
Level Rate Loan Loan Rate Loan Loan
----- --------- ---- --------- ----
Level I 1.50% .00% 1.75% 0.25%
Level II 1.75% .25% 2.00% 0.50%
Level III 2.00% .50% 2.25% 0.75%
Level IV 2.25% .75% 2.50% 1.00%
The Leverage Ratio and Outstandings shall be determined based on the Financial
Statements delivered pursuant to Sections 7.1(a) and (b) for the fiscal quarter
ended immediately prior to the relevant Start Date. The Applicable Margin so
determined shall apply from the Start Date to the End Date. If no Financial
Statements shall have been delivered to the Agent on or prior to the relevant
End Date, the Applicable Level shall be Level IV until such Financial Statements
are delivered.
Assignment and Assumption Agreement shall mean an assignment and
assumption agreement entered into by an assigning Lender and an assignee Lender,
and accepted by the Agent, in accordance with Section 11.6, substantially in the
form of Exhibit M-1.
Auditors shall mean a nationally-recognized firm of independent
public accountants selected by the Borrower and reasonably satisfactory to the
Agent. For purposes of this Credit Agreement, the Borrower's current firm of
independent public accountants, Deloitte & Touche, L.L.P., or Xxxxxx Xxxxxxxx,
L.L.P., shall be deemed to be satisfactory to the Agent.
Available Borrowing Amount shall mean, at any time, the lesser of
(x) the Total Commitment then in effect and (y) the Borrowing Base then in
effect.
Average Borrowing Base shall mean, at any time, the average of
either (x) all Borrowing Base Certificates delivered for the immediately
preceding 12 months, or (y) if prior to the 12 month anniversary of the Closing
Date, all Borrowing Base Certificates previously delivered.
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Bankruptcy Code shall have the meaning given such term in Section
9.1(e).
Bankruptcy Court shall mean the United States Bankruptcy Court of
the District of Delaware.
Base Rate shall mean, at any time, the highest of (i) the Prime
Lending Rate, (ii) 1/2 of 1% in excess of the overnight Federal Funds Rate then
in effect and (iii) 1/2 of 1% in excess of the Adjusted Certificate of Deposit
Rate then in effect. If for any reason BTCo shall have determined (which
determination shall be final absent manifest error) that it is unable to
ascertain the Adjusted Certificate of Deposit Rate, the Base Rate shall be
determined without regard to clause (iii), until the circumstance giving rise to
such inability shall no longer exist.
Base Rate Loan shall mean each Revolving Loan bearing interest as
provided in Section 4.2.
Board of Directors shall mean the Board of Directors of the
Borrower.
Borrower shall have the meaning provided in the preamble to this
Credit Agreement.
Borrower Warrants shall mean each of (i) the Common Stock
Purchase Warrant dated as of February 5, 1997 issued to BTCo representing the
right to purchase shares of common stock of the Borrower and (ii) the Common
Stock Purchase Warrant to be issued in connection with the purchase of the
Permanent Senior Notes as described in the Bridge Senior Note Documents
representing the right to purchase shares of common stock of the Borrower, equal
in the aggregate of up to no more than 10% of the fully diluted common equity of
the Borrower, in each case, subject to the provisions of Section 2.01(b) of the
Warrant Agreement.
Borrowing shall mean an incurrence of Revolving Loans of the same
Type from all the Lenders on the same day (or resulting from Conversion or
Continuance on the same date), having, in the case of Eurodollar Rate Loans, the
same Interest Period.
Borrowing Base shall have the meaning given to such term in
Section 2.2.
Borrowing Base Certificate shall have the meaning given to such
term in Section 7.1(e).
Borrowing Base Deficiency shall mean, at any time, the amount, if
any, by which the Outstandings at such time exceeds the Borrowing Base at such
time.
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Bridge Loan Conversion Date shall mean the date on which Bridge
Senior Notes convert from "Bridge Notes" to "Term Notes" (as defined in the
Senior Credit Agreement) in accordance with the terms of the Senior Credit
Agreement.
Bridge Senior Note Documents shall mean and include each of the
documents and other agreements entered into relating to the issuance by the
Borrower of the Bridge Senior Notes, as in effect on the Closing Date.
Bridge Senior Notes shall mean the Borrower's Senior Notes,
issued pursuant to the Senior Credit Agreement, dated as of the Closing Date,
between the Borrower and BTCo, as Agent and the lenders described therein. As
used herein, the term "Bridge Senior Notes" shall include any "Term Notes"
issued pursuant to the Senior Credit Agreement in exchange for theretofore
outstanding Bridge Senior Notes, as contemplated by the Senior Credit Agreement.
BT Account shall have the meaning given to such term in Section
2.6.
BTCo shall mean Bankers Trust Company.
BT Delaware shall have the meaning provided in Section 2.3(b).
BTCC shall mean BT Commercial Corporation, in its individual
capacity.
Business Day shall mean any day other than a Saturday, Sunday or
legal holiday on which commercial banks in New York, New York are authorized to
close. When used in connection with Eurodollar Rate Loans, this definition will
also exclude any day on which commercial banks are not open for dealing in U.S.
Dollar deposits in the New York interbank Eurodollar market.
Canadian Holdco shall mean 3282392 Canada Inc., a corporation
organized under the federal laws of Canada.
Capital Call Agreement shall have the meaning provided in Section
5.1(cc).
Capital Expenditures shall mean, as applied to any Person for any
period, the aggregate of all expenditures of (whether paid in cash or accrued as
liabilities (including Capitalized Lease Obligations)) such Person and its
Subsidiaries during that period that, in conformity with GAAP, are or are
required to be included in the property, plant or equipment reflected in the
consolidated balance sheet of such Person; provided, that Capital Expenditures
shall in any event include the purchase price paid in connection with the
acquisition of any Person (including through the purchase of all of the capital
stock or other
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ownership interests of such Person or through merger or consolidation) to the
extent allocable to property, plant and equipment.
Capital Lease, as applied to any Person, shall mean any lease of
any property (whether real, personal or mixed) by that Person or any of its
Subsidiaries as lessee which, in conformity with GAAP, is accounted for as a
capital lease on the consolidated balance sheet of that Person.
Capitalized Lease Obligations shall mean the obligations under
Capital Leases of the Borrower and its Subsidiaries in each case taken at the
amount thereof accounted for as liabilities in accordance with GAAP.
Cash Equivalents means (i) marketable direct obligations issued
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 thereof; (ii)
marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having the highest rating obtainable
from Standard & Poor's Rating Group ("S&P") or Xxxxx'x Investors Service, Inc.
("Moody's"); (iii) commercial paper maturing not more than one year from the
date of creation thereof and, at the time of acquisition, having the highest
rating obtainable from either S&P's or Moody's; and (iv) certificates of deposit
or bankers' acceptances maturing within one year from the date of acquisition
thereof issued by any commercial bank organized under the laws of the United
States of America or any state thereof or the District of Columbia that (a) is
at least "adequately capitalized" (as defined in the regulations of its primary
Federal banking regulator) and (b) has Tier 1 capital (as defined in such
regulations) of not less than $500,000,000; (v) shares of any money market
mutual fund that (a) has its assets invested continuously in the types of
investments referred to in clauses (i) and (ii) above, (b) has net assets of not
less than $500,000,000, and (c) has the highest rating obtainable from either
S&P or Moody's; and (vi) repurchase agreements with respect to, and which are
fully secured by a perfected security interest in, obligations of a type
described in clause (i) or clause (ii) above and are with any commercial bank
described in clause (iv) above.
Casualty Loss shall have the meaning given to such term in
Section 7.10.
CERCLA shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, 42 U.S.C. Section 9601 et
seq.
Certificates of Designation shall mean the Series A Certificate
of Designation and the Series B Certificate of Designation.
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Change of Control shall mean (a) the Permitted Holders either
directly or through one or more of their Wholly-Owned Subsidiaries, shall cease
to own a majority on a fully diluted basis of the economic and voting interest
represented by all of the classes of capital stock of Consumers, (b) Consumers,
either directly or through one or more of its Wholly-Owned Subsidiaries, shall
cease to own directly a majority on a fully diluted basis of the economic and
voting interest in the Borrower's capital stock, (c) any Person or "group"
(within the meaning of Rules 13d-3 and 13d-5 under the Securities Exchange Act
of 1934, as in effect on the Effective Date), other than the Permitted Holders
and Consumers and its Wholly-Owned Subsidiaries, shall have obtained the power
(whether or not exercised) to elect a majority of the Borrower's directors, (d)
the Board of Directors of the Borrower shall cease to consist of a majority of
Continuing Directors, or (e) any "Change of Control" as such term is defined in
any Existing Indebtedness Agreement, any Senior Note Document, the Preferred
Stock (or the Certificates of Designation therefore) or any successor or similar
provision, shall occur. For the foregoing purposes, any Subsidiary of a
Permitted Holder shall be deemed to be a Wholly-Owned Subsidiary of such
Permitted Holder to the extent 100% of the capital stock of such Subsidiary is
owned by one or more Permitted Holders.
Closing Date shall mean the date on which the Initial Credit
Event occurs.
Code shall mean the Internal Revenue Code of 1986, as amended
from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to the Code are to the Code, as in effect at the
date of this Agreement and any subsequent provisions of the Code, amendatory
thereof, supplemental thereto or substituted therefor.
Collateral shall mean all of the Collateral as defined in the
Collateral Documents.
Collateral Access Agreements shall have the meaning given to such
term in Section 5.1(e).
Collateral Agent shall mean BTCC acting as collateral agent
pursuant to the Collateral Documents.
Collateral Documents shall mean all contracts, instruments and
other documents now or hereafter executed and delivered in connection with this
Credit Agreement, pursuant to which liens and security interests are granted to
the Collateral Agent in the Collateral for the benefit of the Lenders,
including, without limitation, the Security Agreement, the Pledge Agreement, the
Concentration Account Agreement and the Collection Bank Agreements.
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Collection Account shall mean the account established at a
Collection Bank pursuant to the Collection Bank Agreement, into which funds on
deposit in the relevant Sub-Collection Account shall be transferred pursuant to
Section 2.6.
Collection Bank shall have the meaning given to such term in
Section 2.6.
Collection Bank Agreements shall have the meaning given to such
term in Section 2.6(b)(ii).
Collective Bargaining Agreements shall have the meaning given to
such term in Section 5.1(q)(ii).
Commitment of any Lender shall mean the amount set forth opposite
such Lender's name on Schedule I, as such Schedule may be amended from time to
time, under the heading "Commitment," as such amount may be reduced from time to
time pursuant to the terms of this Credit Agreement.
Commodity Hedge Agreement shall mean an agreement entered into
for the purpose of hedging risk with respect to potential fluctuation in the
price of a commodity including futures contracts, for the purchase, sale or
exchange of commodities.
Common Stock shall mean the Common Stock of the Borrower, par
value $0.10.
Common Stock Financing shall have the meaning given such term in
Section 5.1(i).
Computation Date shall mean the last Business Day of each month
and any other date specified in writing by an Issuing Bank with respect to a
Letter of Credit, or any replacement or renewal thereof.
Concentration Account shall have the meaning given to such term
in Section 2.6(c).
Concentration Account Agreement shall have the meaning given to
such term in Section 2.6(c).
Consolidated Debt shall mean, at any time, all Indebtedness of
the Borrower and its Subsidiaries (i) for borrowed money (including, without
limitation all Revolving Loans) and (ii) with respect to Capitalized Lease
Obligations, in each case determined on a consolidated basis.
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Consolidated Net Income shall mean for any period the
consolidated net income of the Borrower and its Subsidiaries for such period as
determined in accordance with GAAP.
Consolidated Net Worth shall mean, as at any date of
determination, the excess of the assets of the Borrower and its Subsidiaries
over the liabilities of the Borrower and its Subsidiaries as determined on a
consolidated basis in accordance with GAAP; provided that for purposes of
determining Consolidated Net Worth, the Series A Preferred Stock shall be
considered equity.
Consumers shall mean Consumers Packaging Inc., a corporation
organized under the federal laws of Canada.
Contingent Obligations shall mean as to any Person any obligation
of such Person guaranteeing or intended to guarantee any Indebtedness, leases,
dividends or other obligations ("primary obligations") of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, including,
without limitation, any obligation of such Person, whether or not contingent,
(a) to purchase any such primary obligation or any property constituting direct
or indirect security therefor, (b) to advance or supply funds (i) for the
purchase or payment of any such primary obligation or (ii) to maintain working
capital or equity capital of the primary obligor or otherwise to maintain the
net worth or solvency of the primary obligor, (c) 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 or (d) otherwise to assure or hold harmless the owner of
such primary obligation against loss in respect thereof; provided, however, that
the term Contingent Obligations shall not include (x) endorsements of
instruments for deposit or collection in the ordinary course of business or (y)
guarantees made by a Person of the obligations of a Wholly-Owned Subsidiary of
such Person which do not constitute Indebtedness of such Wholly-Owned Subsidiary
and are incurred in the ordinary course of business of such Wholly-Owned
Subsidiary or (z) obligations of the Borrower under the Headquarters Lease (as
defined in the Acquisition Agreement) as in effect on the Closing Date. The
amount of any Contingent Obligation shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation in respect of which such
Contingent Obligation is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof (assuming such Person is
required to perform thereunder) as determined by such Person in good faith.
Continuation and Continuance each shall refer to a continuation
of Revolving Loans pursuant to Section 4.3, provided that neither term shall be
deemed to constitute the making of a Revolving Loan for purposes of this Credit
Agreement.
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Continuing Directors shall mean the directors of the Borrower on
the Closing Date and each other director if such director's nomination for the
election to the Board of Directors of the Borrower is recommended by a majority
of the then Continuing Directors.
Convert, Conversion and Converted each shall refer to a
conversion of Revolving Loans of one Type into Revolving Loans of another Type
pursuant to Section 4.3, provided that each such term shall not constitute the
making of a Revolving Loan for purposes of this Credit Agreement.
Credit Agreement shall mean this Credit Agreement, as the same
may be modified, amended, extended, restated, amended and restated or
supplemented from time to time.
Credit Documents shall mean, collectively, this Credit Agreement,
the Revolving Notes, each of the Collateral Documents, the Intercreditor
Agreement, the U.S. Holdco Guaranty, the Capital Call Agreement and all other
documents, agreements, instruments and certificates now or hereafter executed
and delivered in connection herewith or therewith, as the same may be modified,
amended, extended, restated or supplemented from time to time.
Credit Event shall mean the making of a Revolving Loan or the
issuance of a Letter of Credit.
Current Assets shall mean all assets designated as "current" on a
consolidated balance sheet of the Borrower prepared in accordance with GAAP.
Current Liabilities shall mean all liabilities designated as
"current" on a consolidated balance sheet of the Borrower prepared in accordance
with GAAP (which shall include all Outstandings).
Default shall mean an event, condition or default which with the
giving of notice, the passage of time or both would be an Event of Default.
Defaulting Lender shall have the meaning given to such term in
Section 2.4(c).
Designated Asset Sales shall mean a sale or disposition involving
all or any portion of the Designated Properties.
Designated Properties shall mean the plants of the Borrower set
forth in Schedule XV.
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Disbursement Account shall have the meaning given to such term in
Section 2.3(b).
Dividend shall have the meaning given to such term in Section
8.6.
Dollars and the sign $ shall each mean freely transferable lawful
money of the United States.
Domestic Lending Office shall mean, with respect to any Lender,
the office of such Lender specified as its "Domestic Lending Office" opposite
its name on Schedule I, as such annex may be amended from time to time.
EBITDA shall mean, in any fiscal period, the Consolidated Net
Income (other than extraordinary items and (except as provided in clause (vi)
below) non-recurring (as determined by the Agent in its reasonable discretion)
items of the Borrower and its Subsidiaries for such period but including any
Inventory adjustments), (i) plus the amount of all Interest Expense, income tax
expense, depreciation and amortization, including amortization of any goodwill
or other intangibles for such period, (ii) less gains and plus losses
attributable to any fixed asset sales, (iii) plus or minus (as the case may be)
any other non-cash items (other than any reserve established by the Borrower
against Accounts and/or Inventory) which have been subtracted or added, as the
case may be, in calculating Consolidated Net Income for such period (including,
without limitation, foreign exchange translation adjustments and hedging
transactions entered into pursuant to Commodities Hedging Agreements permitted
by this Agreement), all determined in accordance with GAAP, (iv) plus or minus
(as the case may be) any decrease or increase in the amount of deferred taxes as
shown on the balance sheet as of the end of such period since the first day of
the same period (but without duplication of any taxes included in clause (i) of
this definition), (v) plus or minus (as the case may be) any LIFO expense or
LIFO income, and (vi) plus all customary non-recurring fees and expenses
incurred or paid by the Borrower and its Subsidiaries in connection with the
Transaction, all to the extent added or deducted in calculating Consolidated Net
Income.
Eligible Accounts Receivable shall mean Accounts of the Borrower
payable in Dollars and deemed by the Agent in its Permitted Discretion to be
eligible for inclusion in the calculation of the Borrowing Base. In determining
the amount to be so included, the face amount of such Accounts shall be reduced
by the amount of all returns, discounts, claims, credits, charges, chargebacks,
rebates or other allowances and (but without duplication of any of the
foregoing) by the aggregate amount of all reserves, limits and deductions
provided for in this definition and elsewhere in this Credit Agreement. Unless
otherwise approved in writing by the Agent, no Account shall be deemed to be an
Eligible Account Receivable if:
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(a) it arises out of a sale made by the Borrower to an Affiliate;
or
(b) the Account provides for payment on or before the date which
is 30 days after the date of the original invoice and is unpaid on the date
which is 60 days after the date on which the original invoice provides that such
payment is due; or
(c) the Account provides for payment after the date which is 30
days after the date of the original invoice and is unpaid on the date which is
the earlier of (i) 60 days after the date on which the original invoice provides
that such payment is due and (ii) 120 days after the date of the original
invoice; or
(d) the Account (other than Accounts listed on Schedule XVI
describing the account party and the payment terms, but including any such
Account if such Account is unpaid 30 days after the invoice provides for such
payment) provides for payment more than 91 days after the date of the original
invoice; or
(e) it is from the same account debtor (or any Subsidiary
thereof) and fifty percent (50%) or more, in face amount, of all Accounts from
such account debtor (or any Subsidiary thereof) are ineligible pursuant to (b)
above; or
(f) the Account, when aggregated with all other Accounts of such
account debtor, exceeds five percent (5%), or in the case of the account debtors
listed on Part A of Schedule XV, the percentage set forth opposite such account
debtor's name on Part A of Schedule XV (provided, however, that in no event
shall such percentage exceed 20% (or 25% in the case of the Accounts relating to
Anheuser Xxxxx Brewing Company, Xxxxx Brewing Company, Bacardi International
Limited and its Affiliates and O-I)), in face value of all Accounts of the
Borrower then outstanding, to the extent of such excess; provided, however, that
Accounts supported or secured by an irrevocable letter of credit in form and
substance satisfactory to the Agent, issued by a financial institution
satisfactory to the Agent, and duly pledged to the Collateral Agent (together
with sufficient documentation to permit direct draws by the Collateral Agent)
shall be excluded for purposes of such calculation; or
(g) (i) the account debtor is also a creditor of the Borrower
(other than account debtors which have provided to the Agent a "no-offset"
letter in form and substance satisfactory to the Agent), (ii) the account debtor
has disputed its liability on, or the account debtor has made any claim with
respect to, such Account or any other Account due from such account debtor to
the Borrower, which has not been resolved or (iii) the Account otherwise is or
may become subject to any right of setoff by the account debtor; provided, that
any Account deemed ineligible pursuant to this clause (f) shall only be
ineligible to the extent of the amount owed by the Borrower to the account
debtor, the amount of such dispute or claim, or the amount of such setoff, as
applicable; or
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(h) the account debtor has commenced a voluntary case under the
federal bankruptcy laws, as now constituted or hereafter amended, or made an
assignment for the benefit of creditors, or if a decree or order for relief has
been entered by a court having jurisdiction over the account debtor in an
involuntary case under the federal bankruptcy laws, as now constituted or
hereafter amended, or if any other petition or other application for relief
under the federal bankruptcy laws has been filed by or against the account
debtor, or if the account debtor has filed a certificate of dissolution under
applicable state law or shall be liquidated, dissolved or wound up, or shall
authorize or commence any action or proceeding for dissolution, winding-up or
liquidation, or if the account debtor has failed, suspended business, declared
itself to be insolvent, is generally not paying its debts as they become due or
has consented to or suffered a receiver, trustee, liquidator or custodian to be
appointed for it or for all or a significant portion of its assets or affairs,
unless the payment of Accounts from such account debtor is secured in a manner
satisfactory to the Agent or, if the Account from such account debtor arises
subsequent to a decree or order for relief with respect to such account debtor
under the federal bankruptcy laws, as now or hereafter in effect, the Agent
shall have determined that the timely payment and collection of such Account
will not be impaired; or
(i) the sale is to an account debtor outside of the United States
or Canada (except for Accounts listed on Part B of Schedule XV), unless the
account debtor thereon has supplied the Borrower with an irrevocable letter of
credit in form and substance satisfactory to the Agent, issued by a financial
institution satisfactory to the Agent and which has been duly pledged to the
Collateral Agent (together with sufficient documentation to permit direct draws
by the Collateral Agent); or
(j) the sale to the account debtor is on a xxxx-and-hold,
guaranteed sale, sale-and-return, sale on approval or consignment basis or made
pursuant to any other written agreement providing for repurchase or return
(other than pursuant to ordinary course of business warranties); or
(k) the Agent determines in its Permitted Discretion that such
Account may not be paid by reason of the account debtor's financial inability to
pay; or
(l) the account debtor is the United States of America or any
department, agency or instrumentality thereof, unless the Borrower duly assigns
its rights to payment of such Account to the Collateral Agent pursuant to the
Assignment of Claims Act of 1940, as amended (31 U.S.C. Section 3727 et seq.);
or
(m) title to the goods giving rise to such Account has not been
transferred to the account debtor or the services giving rise to such Account
have not been performed by the Borrower and accepted by the account debtor or
the Account otherwise does not represent a final sale; or
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(n) the Account does not comply with all applicable legal
requirements, including, where applicable, the Federal Consumer Credit
Protection Act, the Federal Truth in Lending Act and Regulation Z of the Board
of Governors of the Federal Reserve System, in each case as amended; or
(o) the amount of such Account relates to charges for pallets; or
(p) the Collateral Agent does not have a valid and perfected
first priority security interest in or Lien on such Account or the Account does
not otherwise conform to the representations and warranties contained in the
Credit Agreement or the other Credit Documents, except that the value of any
Account shall be reduced by the amount of any obligations secured by Permitted
Liens which are prior to the Lien in favor of the Collateral Agent.
Eligible Inventory shall mean Inventory of the Borrower held for
sale in the ordinary course of business deemed by the Agent acting in its
Permitted Discretion to be eligible for inclusion in the calculation of the
Borrowing Base. In any event, Eligible Inventory (i) shall exclude work in
process and inventory which is "held xxxx", (ii) shall account for reserves for
goods that are obsolete, slow moving (does not turn at least once per year),
rejected or returned, (iii) shall include finished goods and (iv) shall exclude
all goods warehoused in facilities holding less than $100,000 in goods. In
determining the amount to be so included, the amount of such Inventory shall be
valued on a FIFO basis at the lower of cost or market as adjusted from the
Borrower's month end balance sheet, less any goods returned or rejected by the
Borrower's customers and goods in transit (other than goods to which the
Borrower has title), less any reserves otherwise required by the Agent pursuant
to Section 2.2(b), and less any Inventory that the Agent determines to be
ineligible pursuant to Section 2.2(b). Unless otherwise approved in writing by
the Agent, no Inventory shall be deemed Eligible Inventory if:
(a) the Inventory is not owned solely by the Borrower and with
respect to which the Borrower does not have good, valid and marketable
title, or is held by a third party for sale on a xxxx-and-hold,
guaranteed sale, sale-and-return, sale on approval or consignment basis;
or
(b) the Inventory is not stored on property that is either (i)
owned or leased by the Borrower or (ii) owned or leased by a
warehouseman that has contracted with the Borrower to store Inventory on
such warehouseman's property provided that with respect to Inventory
stored on property leased by the Borrower, the Borrower shall have
delivered in favor of the Collateral Agent a Collateral Access Agreement
executed by the lessor of such property, and, with respect to Inventory
stored on property owned or leased by a warehouseman, the Borrower shall
have
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delivered to the Collateral Agent a Collateral Access Agreement executed
by such warehouseman; or
(c) the Inventory is not subject to a perfected first priority
Lien in favor of the Collateral Agent except, (i) with respect to
Eligible Inventory stored at sites described in clause (b) above, for
Liens for normal and customary warehouseman charges and (ii) the value
of any Inventory shall be reduced by the amount of any obligations
secured by Permitted Liens which are prior to the Lien in favor of the
Collateral Agent; or
(d) the Inventory is not located in the United States or at the
Inventory location in Ontario Canada set forth on Schedule II; or
(e) the Inventory is obsolete, has been held by the Borrower for
360 days or more and not reserved, or the Inventory does not otherwise
conform to the representations and warranties contained in the Credit
Agreement or the other Credit Documents; or
(f) such Inventory is part of one product line (identified by
mold number) as disclosed on the schedules attached to the Borrowing
Base Certificate and the amount of such Inventory exceeds 20% of the
FIFO stock Inventory at such time (in the amount of such excess); or
(g) it consists of goods returned or rejected by the Borrower's
customers or goods in transit to third parties (other than to warehouse
sites covered by a Collateral Access Agreement); or
(h) whether or not located on property owned or leased by the
Borrower, it is not segregated or otherwise separately identifiable from
goods of others, if any, stored on the same premises as such Inventory;
or
(i) the Inventory consists of stores, supplies packing, shipping
or decorating materials (other than unlabeled cartons and dividers in an
amount not to exceed $2,000,000); or
(j) the Inventory consists of castings or molds.
Eligible Transferee shall mean and include a commercial bank,
financial institution or other "accredited investor" (as defined in SEC
Regulation D).
Employment Agreements shall have the meaning provided in Section
5.1(q)(vi).
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End Date shall mean the date occurring 45 days (or in the case of
the last fiscal quarter of the Borrower, 95 days) after the end of the fiscal
quarter in which the previous Start Date occurred.
Environmental Claims shall mean any and all administrative,
regulatory or judicial actions, suits, demands, demand letters, claims, liens,
notices of noncompliance or violation, investigations (other than internal
reports prepared by the Borrower or any of its Subsidiaries solely in the
ordinary course of such Person's business or as required in connection with a
financing transaction and not in response to any third party action or request
of any kind) or proceedings relating in any way to any Environmental Law or any
permit issued, or any approval given, under any such Environmental Law
(hereafter, "Claims"), including, without limitation, (a) any and all Claims by
governmental or regulatory authorities for enforcement, cleanup, removal,
response, remedial or other actions or damages pursuant to any applicable
Environmental Law, and (b) any and all Claims by any third party seeking
damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from Hazardous Materials arising from alleged injury
or threat of injury to health, safety or the environment.
Environmental Law shall mean any applicable Federal, state,
foreign or local statute, law, rule, regulation, ordinance, code, written guide,
written policy and rule of common law now or hereafter in effect and in each
case as amended, and any judicial or administrative interpretation thereof,
including any judicial or administrative order, consent decree or judgment,
relating to the environment, health, safety or Hazardous Materials, including,
without limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33
U.S.C. Section 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. Section
2601 et seq.; the Clean Air Act, 42 U.S.C. Section 7401 et seq.; the Safe
Drinking Water Act, 42 U.S.C. Section 300F et seq.; the Oil Pollution Act of
1990, 33 U.S.C Section 2701 et seq. and any applicable state and local or
foreign counterparts or equivalents.
Equity Financing shall have the meaning given such term in
Section 5.1(i).
Equity Financing Documents shall mean all of the agreements and
documents entered into in connection with or relating to the Equity Financing,
including without limitation, the TD Loan Agreement.
Equity Investors shall mean (i) Consumers and/or its Affiliates,
(ii) Xxxxx Xxxxxx as escrow agent for certain creditors of Old Anchor Glass and
(iii) Anchor Glass Container Corporation Service Retirement Plan, Pension Plan
for Hourly Employees, Xxxxxxxxx Glass Company and Associated Companies and
Anchor Glass Container Corporation Retirement Plan for Salaried Employees.
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ERISA shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued there- under. Section references to ERISA are to ERISA, as in effect at
the date of this Agreement and any subsequent provisions of ERISA, amendatory
thereof, supplemental thereto or substituted therefor.
ERISA Affiliate shall mean each person (as defined in Section
3(9) of ERISA) which together with the Borrower or a Subsidiary of the Borrower
would be deemed to be a "single employer" (i) within the meaning of Section
414(b), (c), (m) or (o) of the Code or (ii) as a result of the Borrower or a
Subsidiary of the Borrower being or having been a general partner of such
person.
Eurodollar Lending Office shall mean, with respect to any Lender,
the office of such Lender specified as its "Eurodollar Lending Office" opposite
its name on Schedule I, as such annex may be amended from time to time (or, if
no such office is specified, its Domestic Lending Office), or such other office
or Affiliate of such Lender as such Lender may from time to time specify to the
Borrower and the Agent.
Eurodollar Rate shall mean, with respect to an Interest Period
for each Eurodollar Rate Loan comprising part of the same Borrowing, an interest
rate per annum equal to the average (rounded upward to the nearest whole
multiple of one-sixteenth (1/16) of one percent (1%) per annum, if such rate is
not such a multiple) of the offered quotation, if any, to first class banks in
the New York interbank Eurodollar market by BTCo for U.S. dollar deposits of
amounts in immediately available funds comparable to the principal amount of the
Eurodollar Rate Loan of BTCC for which the Eurodollar Rate is being determined
with maturities comparable to the Interest Period for which such Eurodollar Rate
will apply as of approximately 11:00 A.M. New York City time two (2) Business
Days prior to the commencement of such Interest Period.
Eurodollar Rate Loan shall mean a Revolving Loan bearing interest
as provided in Section 4.1.
Event of Default shall have the meaning provided for in Section
9.1 of this Credit Agreement.
Existing Credit Agreement shall mean the Credit Agreement among
Old Anchor Glass, Foothill Capital Corporation and Congress Financial
Corporation, as amended, modified or supplemented to and including the Closing
Date.
Existing Indebtedness shall mean all Indebtedness of the Acquired
Business outstanding prior to, and to remain outstanding on and after, the
Closing Date, and set forth
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on Schedule IX, without giving effect to extensions or renewals thereto, except
as expressly provided therein.
Existing Indebtedness Agreements shall have the meaning given to
such term in Section 5.1(q)(iii) hereof.
Existing Liens shall have the meaning set forth in Section
8.2(e).
Existing Senior Secured Notes shall mean the Series A Senior
Secured Notes due July 15, 1998, the Series B Senior Secured Notes due July 15,
1999 and the Series C Senior Secured Notes due July 15, 1999.
Expenses shall mean all present and future invoiced expenses
incurred by or on behalf of the Agent in connection with this Credit Agreement,
any other Credit Document or otherwise in its capacity as the Agent under this
Credit Agreement, whether incurred heretofore or hereafter, which expenses shall
include, without being limited to, the cost of record searches, the reasonable
fees and expenses of attorneys and paralegals, all costs and expenses incurred
by the Agent in opening bank accounts, depositing checks, electronically or
otherwise receiving and transferring funds, and any charges imposed on the Agent
due to insufficient funds of deposited checks and the standard fee of the Agent
relating thereto, collateral examination fees and expenses, reasonable fees and
expenses of accountants, appraisers or other consultants, experts or advisors
employed or retained by the Agent, out of pocket syndication fees and expenses,
fees and taxes relative to the filing of financing statements, costs of
preparing and recording any other Collateral Documents, all expenses, costs and
fees set forth in Article 4 of this Credit Agreement, all other fees and
expenses required to be paid pursuant to the Fee Letter and all fees and
expenses incurred in connection with releasing Collateral and the amendment or
termination of any of the Credit Documents.
Expiration Date shall mean February 5, 2002.
Facing Fees shall have the meaning provided in Section 4.7.
Federal Funds Rate shall mean, for any period, a fluctuating
interest rate per annum equal, for each day during such period, to 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 for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day that is a Business Day, the average of the quotations for such day
on such transactions received by the Payments Administrator from three Federal
Funds brokers of recognized standing selected by it.
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Fee Letter shall mean that certain letter dated as of December 2,
1996 among BTCC and Consumers providing for the payment of certain fees in
connection with this Credit Agreement.
Fees shall mean, collectively, the Unused Line Fee, the Letter of
Credit Fees, the Facing Fees, the Issuing Bank Fees and the other fees provided
for in the Fee Letter.
Financial Statements shall mean the consolidated and
consolidating balance sheets and statements of operations and consolidated
statements of cash flows and statements of changes in shareholder's equity of
the Borrower for the period specified prepared in accordance with GAAP, which
shall include for purposes of Financial Statements to be delivered pursuant to
Section 7.1(a) plant-by-plant statements of operations.
GAAP shall mean generally accepted accounting principles in the
United States as in effect from time to time subject to Section 1.2.
Governing Documents shall mean, as to any Person, the certificate
or articles of incorporation and by-laws or other organizational or governing
documents of such Person.
Governmental Authority shall mean any nation or government, any
state or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
Hazardous Materials shall mean (a) any petroleum or petroleum
products, radioactive materials, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation and transformers or other equipment
that contained dielectric fluid containing levels of polychlorinated biphenyls;
(b) any chemicals, materials or substances defined as or included in the
definition of "hazardous substances," "hazardous waste," "hazardous materials,"
"extremely hazardous waste," "restricted hazardous waste," "toxic substances,"
"toxic pollutants," "contaminants," or "pollutants," or words of similar import,
under any applicable Environmental Law; and (c) any other chemical, material or
substance, exposure to which is prohibited, limited or regulated by any
governmental authority.
Headquarters Property shall have the meaning provided in Section
8.23.
Headquarters Reserve shall have the meaning provided in Section
8.23.
Highest Lawful Rate shall mean, at any given time during which
any Obligations shall be outstanding hereunder, the maximum nonusurious interest
rate, if any, that
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at any time or from time to time may be contracted for, taken, reserved, charged
or received on the Obligations owing under this Credit Agreement and any other
Credit Document, under the laws of the State of New York (or the law of any
other jurisdiction whose laws may be mandatorily applicable notwithstanding
other provisions of this Credit Agreement and the other Credit Documents), or
under applicable federal laws which may presently or hereafter be in effect and
which allow a higher maximum nonusurious interest rate than under New York (or
such other jurisdiction's) law, in any case after taking into account, to the
extent permitted by applicable law, any and all relevant payments or charges
under this Credit Agreement and any other Credit Documents executed in
connection herewith, and any available exemptions, exceptions and exclusions.
Indebtedness of any Person shall mean without duplication (i) all
indebtedness of such Person for borrowed money, (ii) the deferred purchase price
of assets or services which in accordance with GAAP would be shown on the
liability side of the balance sheet of such Person, (iii) the face amount of all
letters of credit issued for the account of such Person and, without
duplication, all drafts drawn thereunder, (iv) all indebtedness of a second
Person secured by any Lien on any property owned by such first Person, whether
or not such indebtedness has been assumed, but only to the extent of the value
of the assets secured by such Lien if such indebtedness has not been assumed,
(v) all Capitalized Lease Obligations of such Person, (vi) the net payment
obligations of such Person to pay a specified purchase price for goods or
services whether or not delivered or accepted, i.e., take-or-pay and similar
obligations, (vii) all net payment obligations of such Person under Interest
Rate Agreements, (viii) Commodity Hedging Agreements, (ix) all reimbursement or
other monetary obligations with respect to surety, performance and bid bonds,
and (x) all Contingent Obligations of such Person; provided, that Indebtedness
shall not include trade payables and accrued expenses, in each case arising in
the ordinary course of business.
Indemnity Agreement shall mean the Indemnity Agreement, dated as
of December 18, 1996, among the Borrower, Consumers and Vitro, Socieded Anonima,
as the same may be amended, modified or supplemented from time to time in
accordance with the terms hereof and thereof.
Independent Financial Advisor shall mean a firm (i) which does
not, and whose directors, officers and employees or Affiliates do not, have a
direct or indirect financial interest in the Borrower, (ii) which, in the
judgment of the Board of Directors of the Borrower, is otherwise independent and
qualified to perform the task for which it is to be engaged and (iii) which
shall, in the case of machinery and equipment, be a qualified appraiser.
Initial Credit Event shall mean the making of the initial
Revolving Loans or the issuance of the initial Letter of Credit hereunder.
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Intercreditor Agreement shall have the meaning provided in
Section 5.1(g).
Interest Coverage Ratio shall mean for any period the ratio for
such period of (x) the sum of (a) EBITDA and (b) Operating Lease Payments to (y)
the sum of (i) Interest Expense and (ii) Operating Lease Payments.
Interest Expense shall mean the aggregate consolidated interest
accrued and/or paid by the Borrower and its Subsidiaries in respect of
Indebtedness determined on a consolidated basis in accordance with GAAP,
including, without limitation, amortization of original issue discount on any
Indebtedness and of all fees payable in connection with the incurrence of such
Indebtedness (to the extent included in interest expense), the interest portion
of any deferred payment obligation the interest component of any Capital Lease
Obligations, net cash costs under any Interest Rate Agreements or Commodity
Hedge Agreements, all capitalized interest and interest paid by the Borrower or
its Subsidiaries on debt guaranteed by the Borrower or its Subsidiaries.
Interest Period shall mean for any Eurodollar Rate Loan the
period commencing on the date of the Borrowing, Conversion or Continuance
thereof and ending on the last day of the period selected by the Borrower
pursuant to the provisions below. The duration of each such Interest Period
shall be one, two, three or six months, in each case as the Borrower may, in an
appropriate Notice of Borrowing, Notice of Continuation or Notice of Conversion,
select; provided, however, that the Borrower may not select any Interest Period
that ends after the Expiration Date. Whenever the last day of any Interest
Period would otherwise occur on a day other than a Business Day, the last day of
such Interest Period shall be extended to occur on the next succeeding Business
Day; provided, however, that if such extension would cause the last day of such
Interest Period to occur in the next following calendar month, the last day of
such Interest Period shall occur on the next preceding Business Day. Whenever
any Interest Period begins on the last Business Day of a calendar month (or on a
day for which there is no numerically corresponding day in the calendar month at
the end of such Interest Period), such Interest Period shall end on the last
Business Day of the applicable calendar month.
Interest Rate Agreement shall mean any interest rate protection
agreement, interest rate future, interest rate option, interest rate swap,
interest rate cap or other interest rate hedge or arrangement under which the
Borrower or any of its Subsidiaries is a party or beneficiary.
Inventory shall mean all of the inventory owned by the Borrower,
including without limitation: (i) all raw materials, work in process, parts,
components, assemblies, supplies and materials used or consumed in the
Borrower's business; (ii) all goods, wares and merchandise, finished or
unfinished, held for sale or lease or leased or furnished or to
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be furnished under contracts of service; and (iii) all goods returned or
repossessed by the Borrower.
Inventory Sublimit shall have the meaning given to such term in
Section 2.2(a).
Investment shall have the meaning given to such term in Section
8.5.
Issuing Bank shall mean BTCo, PNC or any Lender that is
acceptable to the Agent which has agreed to issue a Letter of Credit for the
account of the Borrower under this Credit Agreement.
Issuing Bank Fees shall have the meaning given to such term in
Section 4.7.
Lease Reserve Amount shall initially mean zero, and shall be
increased and reduced by the amounts and at the times set forth in Section 8.23.
Lender shall have the meaning given to such term in the preamble
to this Credit Agreement.
Letter of Credit Fees shall have the meaning given to such term
in 4.7.
Letter of Credit Obligations shall mean, at any time, the sum of
(i) the aggregate undrawn amount of all Letters of Credit outstanding at such
time, plus (ii) the aggregate amount of all drawings under Letters of Credit
which have not been reimbursed by the Borrower (including through the incurrence
of Revolving Loans).
Letter of Credit Request shall have the meaning given to such
term in Section 3.4.
Letters of Credit shall mean all letters of credit (whether
documentary or stand-by and whether for the purchase of inventory, equipment or
otherwise) issued for the account of the Borrower pursuant to Article 3 of this
Credit Agreement and all amendments, renewals, extensions or replacements
thereof.
Level shall mean and include Level I, Level II, Level III or
Level IV, whichever is then in effect.
Level I shall be in effect at any time Leverage Ratio is less
than 2.25 to 1.
Level II shall be in effect at any time Leverage Ratio is equal
to or greater than 2.25 to 1 but less than 2.75 to 1.
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Level III shall be in effect at any time Leverage Ratio is equal
to or greater than 2.75 to 1 but less than 3.25 to 1.
Level IV shall be in effect at any time Leverage Ratio is equal
to or greater than 3.25 to 1.
Leverage Ratio shall mean, at any time, the ratio of Consolidated
Debt at such time to EBITDA on the last day of the Test Period.
Lien(s) shall mean any lien, charge, pledge, security interest,
deed of trust, mortgage, other encumbrance or other arrangement having the
practical effect of the foregoing or other preferential arrangement of any other
kind and shall include the interest of a vendor or lessor under any conditional
sale agreement, capital lease or other title retention agreement.
Management Agreements shall have the meaning given to such term
in Section 5.1(q)(v).
Margin Stock shall have the meaning provided in Regulation U.
Material Adverse Effect shall mean a material adverse effect on
(i) the business, operations, results of operations, assets, liabilities,
financial condition or prospects of the Acquired Business, U.S. Holdco or the
Borrower and its Subsidiaries taken as a whole (except as resulting from the
bankruptcy proceeding of Old Anchor Glass), (ii) the value of Collateral or the
amount which the Agent and the Lenders would be likely to receive (after giving
consideration to delays in payment and costs of enforcement) in the liquidation
of such Collateral, (iii) U.S. Holdco's and the Borrower's ability to perform
its material obligations under the Credit Documents to which it is a party, or
(iv) the material rights and remedies of the Agent, the Issuing Banks or the
Lenders under any Credit Document.
Material Contract shall mean any contract or other arrangement
(other than the Credit Documents), whether written or oral, to which the
Borrower or any of its Subsidiaries is a party as to which the breach,
nonperformance, cancellation or failure to renew by any party thereto may be
reasonably expected to have a Material Adverse Effect.
Moody's shall mean Xxxxx'x Investors Service, Inc.
Multiemployer Plan shall mean a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA.
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Net Sale Proceeds shall mean for any sale, lease, transfer or
other disposition of assets, the gross cash proceeds (including any cash
received by way of deferred payment pursuant to a promissory note, receivable or
otherwise, but only as and when received) received by the Borrower or any of its
Wholly-Owned Subsidiaries from such sale, lease, transfer or other disposition,
net of reasonable transaction costs (including, without limitation, income taxes
estimated to be payable as a result of such sale, lease, transfer or other
disposition, any underwriting, brokerage or other customary selling commissions
and reasonable legal, advisory and other fees and expenses, including title and
recording expenses and reasonable expenses incurred for preparing such assets
for sale, associated therewith) and payments of unassumed liabilities relating
to the assets sold at the time of, or within 30 days after, the date of such
sale, the amount of such gross cash proceeds required to be used to repay any
Indebtedness (other than Indebtedness to the Lenders pursuant to this Credit
Agreement) which is secured by the respective assets which were sold.
Notice of Borrowing shall have the meaning given to such term in
Section 2.3(a)(i) and shall include any deemed Notice of Borrowing pursuant to
Section 3.5.
Notice of Continuation shall have the meaning given to such term
in Section 4.3(a).
Notice of Conversion shall have the meaning given to such term in
Section 4.3(b).
Obligations shall mean, without duplication, the unpaid principal
of and interest on (including interest accruing on or after the filing of any
petition in bankruptcy, or the commencement of any insolvency, reorganization or
like proceeding, relating to the Borrower or any Subsidiary of the Borrower,
whether or not a claim for post-filing or post-petition interest is allowed in
such proceeding) the Revolving Notes, any reimbursement obligation or indemnity
of the Borrower or any Subsidiary of the Borrower on account of Letters of
Credit or any accommodation extended with respect to applications for Letters of
Credit, the Fees, the Expenses and all other obligations and liabilities of the
Borrower or any Subsidiary of the Borrower to the Agent, the Issuing Banks or to
the Lenders, 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 Credit Agreement, the Revolving Notes, any other
Credit Document and any other document made, delivered or given in connection
herewith or therewith.
Old Anchor Glass shall mean Anchor Glass Container Corporation, a
Delaware corporation as debtor-in-possession.
O-I shall mean Xxxxx-Xxxxxxxx Glass Container, Inc., a Delaware
corporation.
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O-I Assurance Agreement shall have the meaning provided in
Section 5.1(aa).
Operating Lease shall mean as applied to any Person, any lease of
any property (whether real, personal or mixed) by that Person other than a
Capitalized Lease Obligation.
Operating Lease Payment shall mean any payment made by the
Borrower or any of its Subsidiaries under an Operating Lease.
Orders shall mean the Sale Order and any other orders of the
Bankruptcy Court entered in connection with the Transaction.
Outstandings shall mean, at any time, the sum of (i) the
principal amount of Revolving Loans outstanding at such time plus (ii) the
Letter of Credit Obligations at such time.
Payment Office shall mean 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 or any other office within the continental United States designated by the
Payments Administrator to the Borrower from time to time as the office for
payment of all amounts required to be paid by the Borrower under this Credit
Agreement.
Payments Administrator shall mean BTCC; provided, however, that
if BTCC shall cease to be the Agent hereunder, the Lenders shall have the option
to appoint one of the remaining Lenders as the Payments Administrator by written
notice to the Borrower.
PBGC shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA, or any successor thereto.
Permanent Senior Note Documents shall mean all purchase
agreements, indentures and other instruments evidencing or entered into in
connection with the Permanent Senior Notes including, without limitation, the
Borrower's Common Stock Purchase Warrants.
Permanent Senior Notes shall mean senior secured notes of the
Borrower, issued pursuant to a private placement, public offering or similar
transaction, (x) with terms and conditions substantially as favorable or better
to the Borrower (in the reasonable judgment of the Agent) as the Description of
Notes delivered to the Lenders prior to the Closing Date.
Permitted Discretion shall mean, with respect to the Agent, the
Agent's judgment exercised in good faith based upon its consideration of any
factor which the Agent
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believes in good faith: (i) will or could adversely affect the value of any
Collateral, the enforceability or priority of the Collateral Agent's Liens
thereon or the amount which the Agent and the Lenders would be likely to receive
(after giving consideration to delays in payment and costs of enforcement) in
the liquidation of such Collateral; (ii) suggests that any collateral report or
financial information delivered to the Agent by any Person on behalf of the
Borrower or any Subsidiary of the Borrower is incomplete, inaccurate or
misleading in any material respect; (iii) materially increases the likelihood of
a bankruptcy, reorganization or other insolvency proceeding involving the
Borrower or any of the Borrower's Subsidiaries or any of the Collateral; or (iv)
creates or reasonably could be expected to create a Default or Event of Default.
In exercising such judgment, the Agent may consider such factors already
included in or tested by the definition of Eligible Accounts Receivable or
Eligible Inventory, as well as any of the following: (i) the financial and
business climate of the Borrower's industry; (ii) changes in collection history
and dilution with respect to the Accounts; (iii) significant changes in demand
for, and pricing of, Inventory; (iv) significant changes in any concentration of
risk with respect to Accounts and Inventory; and (v) any other factors that
significantly increase the credit risk of lending to the Borrower on the
security of the Accounts and Inventory. The Agent shall disclose to the Borrower
the basis on which its Permitted Discretion is exercised; however, the burden of
establishing lack of good faith hereunder shall be on the Borrower.
Permitted Holders means (a) Xxxx X. Xxxxxxxx and (b) any Person
as to which Xxxx X. Xxxxxxxx either (i) "beneficially" owns (as defined in Rules
13d-3 and 13d-5 under the Securities Exchange Act of 1934) on a fully diluted
basis all of the economic and voting interest of all of the classes of capital
stock of such Person or (ii) is the sole trustee or general partner or otherwise
has the sole power to manage the business and affairs of such Person.
Permitted Liens shall have the meaning given to such term in
Section 8.2.
Permitted Materials shall have the meaning given to such term in
Section 6.18(c).
Person shall mean any individual, sole proprietorship,
partnership, joint venture, trust, unincorporated organization, association,
corporation, institution, entity, party or government (including any division,
agency or department thereof), and, as applicable, the successors, heirs and
assigns of each.
Plan shall mean any pension plan as defined in Section 3(2) of
ERISA, which is maintained or contributed to by (or to which there is an
obligation to contribute by) the Borrower or a Subsidiary of the Borrower or an
ERISA Affiliate which is organized under the laws of the United States and is
subject to Title I of ERISA, and each such plan for the five year period
immediately following the latest date on which the Borrower, or
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a Subsidiary of the Borrower or an ERISA Affiliate maintained, contributed to or
had an obligation to contribute to such plan.
Plant Closures shall mean the closing and discontinuance of
operation of plants in the ordinary course of business including Plant Closures
previously implemented by Old Anchor Glass and Plant Closures which may be
implemented by the Borrower.
Plant Sales shall mean the sale of (x) the Hayward, California
and Antioch, California manufacturing plants of Old Anchor Glass and (y) all of
Old Anchor Glass' interest in (1) the partnership arrangement between Old Anchor
Glass and Coors Brewing Company and (2) the Supply Agreement, dated as of the
1st day of January, 1995, between Old Anchor Glass and Coors Brewing Company to
O-I pursuant to the Acquisition Agreement.
Plan Termination Agreement shall have the meaning provided in
Section 5.1(k)(C).
Pledge Agreement shall have the meaning provided in Section
5.1(dd).
PNC shall mean PNC Bank, National Association.
PNC Expense Letter shall mean that certain letter dated as of
January __, 1997 between PNC and Consumers providing for the payment of certain
expenses in connection with this Credit Agreement.
Preferred Stock shall mean the Series A Preferred Stock and the
Series B Preferred Stock.
Preferred Stock Financing shall have the meaning given such term
in Section 5.1(i).
Prime Lending Rate shall mean the rate which BTCo publicly
announces in New York City from time to time as its prime lending rate, as in
effect from time to time. The Prime Lending Rate is a reference rate and does
not necessarily represent the lowest or best rate actually charged to any
customer. BTCo may make commercial loans or other loans at rates of interest at,
above or below the Prime Lending Rate.
Projections shall have the meaning provided in Section 5.1(s).
Proportionate Share shall mean, with respect to any Lender, a
fraction (expressed as a percentage), the numerator of which shall be the amount
of such Lender's Commitment and the denominator of which shall be the Total
Commitments or, if the
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Commitments are terminated, a fraction the numerator of which shall be the
amount of such Lender's Revolving Loans and the denominator of which shall be
the aggregate amount of then outstanding Revolving Loans of all the Lenders.
Quarterly Period shall mean that period commencing on the
relevant Start Date and ending on the relevant End Date.
RCRA shall mean the Resources Conservation and Recovery Act, as
amended, 42 U.S.C. Section 6901 et seq.
Real Property of any Person shall mean all of the right, title
and interest of such Person in and to land, improvements and fixtures, including
leaseholds.
Regulation D shall mean Regulation D of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor
thereto.
Regulation U shall mean Regulation U of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor
thereto.
Replaced Lender shall have the meaning provided in Section
11.6(d).
Replacement Lender shall have the meaning provided in Section
11.6(d).
Reportable Event shall mean an event described in Section 4043(c)
of ERISA with respect to a Plan that is subject to Title IV of ERISA other than
those events to the extent to which the 30-day notice period is waived under
subsection .22, .23, .25, .27, .28, .29, .30, .31 or .32(c)(2), (3) or (4) of
PBGC Regulation Section 4043.
Required Lenders shall mean, at any time, those Lenders then owed
or holding in the aggregate more than 50% of the sum of the then existing
aggregate unpaid principal amount of the Revolving Loans and the then existing
aggregate undrawn amount of the Total Commitments.
Requirement of Law shall mean, as to any Person, the 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.
Revolving Loans shall have the meaning given to such term in
Section 2.1.
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Revolving Note shall mean a promissory note of the Borrower
payable to the order of a Lender, in the form of Exhibit A, evidencing the
aggregate Indebtedness of the Borrower to such Lender resulting from the
Revolving Loans made by such Lender or acquired by such Lender pursuant to
Section 11.6.
S&P shall mean Standard & Poor's Rating Services.
Sale Order shall have the meaning provided in Section 5.1(k)(E).
Section 2.9(b)(ii) Certificate shall have the meaning given such
term in Section 2.9(b)(ii).
Security Agreement shall have the meaning given such term in
Section 5.1(d).
Senior Credit Agreement shall mean that Credit Agreement dated as
of February 5, 1997 among Anchor Glass Acquisition Corporation, the Guarantors
named therein, the Lenders named therein and Bankers Trust Company as Agent.
Senior Note Documents shall mean the Bridge Senior Note Documents
and the Permanent Senior Note Documents.
Senior Notes shall mean the Bridge Senior Notes and the Permanent
Senior Notes.
Series A Certificate of Designation shall mean the Certificate of
Designation, Preferences and Relative, Participating, Optional or other Rights,
and the Qualifications, Limitations or Restrictions thereof, of the Series A 10%
Cumulative Convertible Preferred Stock of the Borrower.
Series A Preferred Stock shall mean the Series A 10% Cumulative
Convertible Preferred Stock of the Borrower described in the Series A
Certificate of Designation.
Series B Certificate of Designation shall mean the Certificate of
Designation, Preferences and Relative, Participating, Optional or other Rights,
and the Qualifications, Limitations or Restrictions thereof, of the Series B 8%
Cumulative Convertible Preferred Stock of the Borrower.
Series B Preferred Stock shall mean the Series B 8% Cumulative
Convertible Preferred Stock of the Borrower described in the Series B
Certificate of Designation.
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Settlement Date shall have the meaning given to such term in
Section 2.4(b)(i).
Shared Collateral shall have the meaning provided in the
Intercreditor Agreement.
Shareholders' Agreements shall have the meaning given to such
term in Section 5.1(q)(iv).
Start Date shall mean the date occurring 45 days (or in the case
of the last fiscal quarter of the Borrower, 95 days) after the end of each
fiscal quarter of the Borrower.
Xxxxx'x Payments shall mean payments of up to $6.0 million in
1997 and $7.0 million in 1998 to The Xxxxx Brewing Company pursuant to the
Agreement dated June 17, 1996 between The Xxxxx Brewing Company and Old Anchor
as in effect on the date hereof.
Sub-Collection Account shall have the meaning given to such term
in Section 2.6(b)(i).
Subsidiary shall mean as to any Person, a corporation,
partnership 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 Credit Agreement shall
refer to a Subsidiary or Subsidiaries of the Borrower.
Syndication Agents shall mean BTCC and PNC, together with their
affiliates acting as co-syndication agents under this Agreement.
Syndication Date shall mean the earlier of (x) the date which is
90 days after the Closing Date and (y) the date upon which the Agent determines
in its sole discretion (and notifies the Borrower) that the primary syndication
(and the resulting addition of institutions as Lenders pursuant to Section 11.6)
has been completed, notice of which shall be promptly given to the Borrower.
Tax Sharing Agreements shall have the meaning given to such term
in Section 5.1(q)(vii).
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Taxes shall have the meaning given to such term in Section 2.9.
Technical Assistance and License Agreement shall mean the
Technical Assistance and License Agreement dated as of December 18, 1996 between
O-I and Consumers with respect to which the Borrower has rights as a member of
the "License Group" (as defined therein).
Test Period shall mean, at any time, the four consecutive fiscal
quarters of the Borrower then last ended (taken as a whole).
TD Loan Agreement shall mean that amended and restated loan
agreement dated as of January 31, 1997 among Consumers and Toronto-Dominion,
Canadian Imperial Bank of Commerce and of the financial institutions from time
to time admitted as Lenders thereunder.
Toronto-Dominion shall mean Toronto-Dominion Bank.
Total Commitments shall mean the aggregate of the Commitments of
all the Lenders.
Transaction shall mean, collectively, (i) the Equity Financing,
(ii) the issuance of the Bridge Senior Notes, (iii) the Plant Sales, (iv) the
Acquisition and (v) the occurrence of the Initial Credit Event on the Closing
Date.
Transaction Documents shall mean, collectively, (i) the Bridge
Senior Note Documents, (ii) the Credit Documents, (iii) the Equity Financing
Documents and (iv) the Acquisition Documents.
Type shall mean, with respect to any Revolving Loan, whether such
Revolving Loan is a Eurodollar Rate Loan or a Base Rate Loan.
UCC shall mean the Uniform Commercial Code.
Unfunded Current Liability of any Plan shall mean the amount, if
any, by which the actuarial present value of the accumulated plan benefits under
the Plan as of the close of its most recent plan year, determined in accordance
with actuarial assumptions at such time consistent with Statement of Financial
Accounting Standards No. 87, exceeds the market value of the assets allocable
thereto.
Unused Line Fee shall have the meaning given to such term in
Section 4.6.
U.S. Holdco shall mean Consumers U.S., Inc., a Delaware
corporation.
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U.S. Holdco Guaranty shall have the meaning provided in Section
5.1(z).
Vitro shall mean Vitro, Sociedad Anonima, a corporation organized
under the laws of the United Mexican States.
Wholly-Owned Subsidiary of any Person shall mean any Subsidiary
of such Person to the extent all of the capital stock or other ownership
interests in such Subsidiary, other than directors' qualifying shares, is owned
directly or indirectly by such Person or a Wholly-Owned Subsidiary thereof.
Working Capital Ratio shall mean, at any time, the ratio of
Current Assets divided by Current Liabilities.
1.2 Accounting Terms and Determinations. Unless otherwise defined
or specified herein, all accounting terms used herein shall have the meanings
customarily given in accordance with GAAP, and all financial computations to be
made under this Credit Agreement shall, unless otherwise specifically provided
herein, be made in accordance with GAAP in effect on the Closing Date (including
the fresh start financial reporting of the Borrower previously described to the
Agent). All accounting determinations for purposes of determining compliance
with Sections 8.9 through 8.12 hereof shall be made in accordance with GAAP as
in effect on the Closing Date (including the fresh start financial reporting of
the Borrower previously described to the Agent) and shall exclude in any event
the effects, if any, of the adoption and continuing implementation of statements
106 and 109 of the Financial Accounting Standards Board. The Financial
Statements required to be delivered hereunder from and after the Closing Date
and all financial records shall be maintained in accordance with GAAP as in
effect on the Closing Date (including the fresh start financial reporting of the
Borrower previously described to the Agent). If GAAP shall change after the
Closing Date, the certificates required to be delivered pursuant to Section 7.1
demonstrating compliance with the covenants contained herein shall include
calculations setting forth the adjustments necessary to demonstrate how the
Borrower is in compliance with the financial covenants based upon GAAP as
utilized on the Closing Date (including the fresh start financial reporting of
the Borrower previously described to the Agent). If, after the Closing Date, the
Borrower shall change its method of inventory accounting from the
first-in-first-out method to the last-in-first-out method, all calculations
necessary to determine compliance with the covenants contained herein shall be
made as if such method of inventory accounting had not been so changed. Any
reference herein to a fiscal quarter shall mean a fiscal quarter consisting of
63 Business Days, except in the case of 366-day year, in which case one fiscal
quarter may contain an additional Business Day. Any reference herein to a fiscal
month shall mean a fiscal month consisting of 21 Business Days.
1.3 Other Defined Terms. Terms not otherwise defined herein which
are defined in the UCC as in effect on the date hereof in the State of New York
shall have the
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meanings given them in such UCC. The words "hereof," "herein" and "hereunder"
and words of similar import when used in this Credit Agreement shall refer to
this Credit Agreement as a whole and not to any particular provision of this
Credit Agreement, and references to Article, Section, Schedule, Exhibit and like
references are references to this Credit Agreement unless otherwise specified.
An Event of Default shall "continue" or be "continuing" until such Event of
Default has been cured or waived in accordance with Section 11.10 hereof.
ARTICLE 2.
Revolving Loans
2.1 Commitments. Subject to the terms and conditions set forth in
this Credit Agreement, on and after the Closing Date and to and excluding the
Expiration Date, each of the Lenders severally agrees to make loans and advances
to the Borrower hereunder (the "Revolving Loans"). The Borrower hereby agrees to
execute and deliver to each Lender a Revolving Note in the form of Exhibit A to
evidence the Revolving Loans made by such Lender.
2.2 Determination of Borrowing Base. (a) Subject to Section
2.2(b) and Section 2.3(c), Revolving Loans shall not in aggregate principal
amount exceed the lesser of:
(i) the Total Commitments then in effect minus the Letter of
Credit Obligations; and
(ii) the amount then equal to:
(A) Eighty-five percent (85%) of the Eligible Accounts
Receivable, plus
(B) Fifty-five percent (55%) of the Eligible Inventory, and
minus
(C) the Lease Reserve Amount, if any, and minus
(D) the Letter of Credit Obligations.
The sum of the amounts calculated in accordance with clause (ii)(A), (B) and (C)
above is hereinafter referred to as the "Borrowing Base." In addition,
eighty-five percent (85%) of the Eligible Accounts Receivable shall at least be
thirty-five percent (35%) of Outstandings (the "Inventory Sublimit").
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(b) The Agent shall (x) at any time be entitled to (i) establish
and increase or decrease reserves against Eligible Accounts Receivable and
Eligible Inventory, and (ii) impose additional restrictions (or eliminate the
same) to the standards of "Eligible Accounts Receivable" and "Eligible
Inventory" and (y) upon not less than ten (10) days' prior notice to the
Borrower reduce the advance rates under Section 2.2(a)(ii)(A) or (B) or the
Inventory Sublimit or restore such advance rates to any level equal to or below
the advance rates stated in Section 2.2(a)(ii)(A) or (B) or the Inventory
Sublimit, and "Eligible Inventory," in the exercise of its Permitted Discretion.
The Agent may but shall not be required to rely on each Borrowing Base
Certificate and any other schedules or reports delivered to it in connection
herewith in determining the then eligibility of Accounts and Inventory. Reliance
thereon by the Agent from time to time shall not be deemed to limit the right of
the Agent to revise advance rates or standards of eligibility as provided in
this Section 2.2(b).
(c) The Borrowing Base will be computed weekly (or, if requested
by the Agent in the exercise of its Permitted Discretion, more frequently as so
requested) and a Borrowing Base Certificate presenting its computation will be
delivered promptly to the Agent as set forth in Section 7.1(e). Notwithstanding
anything to the contrary contained herein, the Agent shall be satisfied that
(based on the final collateral examination report delivered pursuant to Section
5.1(w) below), on the Closing Date and after giving effect to the consummation
of the Transaction, the Borrower shall be able to incur additional Outstandings,
after giving effect to the Outstandings on the Closing Date of $50,000,000 or
more in compliance with the Borrowing Base and Inventory Sublimits restrictions.
2.3 Borrowing Mechanics. (a) Except as provided in Section
2.3(b), Borrowings shall be made on notice from the Borrower to the Payments
Administrator, given not later than 1:00 P.M. New York City time on the date on
which the proposed Borrowing consisting of Base Rate Loans is requested to be
made and on the third Business Day prior to the date on which any proposed
Borrowing consisting of Eurodollar Rate Loans is requested to be made.
(i) Each Notice of Borrowing shall be given by either telephone,
telecopy, telex, facsimile or cable, and, if by telephone, confirmed in
writing, substantially in the form of Exhibit B-1 (the "Notice of
Borrowing"). Each Notice of Borrowing shall be irrevocable by and
binding on the Borrower.
(ii) The Borrower shall notify the Payments Administrator in
writing of the names of the officers authorized to request Revolving
Loans on behalf of Borrower, and shall provide the Payments
Administrator with a specimen signature of each such officer. The
Payments Administrator shall be entitled to rely conclusively on such
officers' authority to request Revolving Loans on behalf of the Borrower
until the Payments Administrator receives written notice to the
contrary. The Payments Administrator shall have no duty to verify the
authenticity of the
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signature appearing on any Notice of Borrowing or other writing
delivered pursuant to this Section 2.3(a) and, with respect to an oral
request for Revolving Loans, the Payments Administrator shall have no
duty to verify the identity of any individual representing himself as
one of the officers authorized to make such request on behalf of the
Borrower. Neither the Payments Administrator nor any of the Lenders
shall incur any liability to the Borrower as a result of acting upon any
telephonic notice referred to in this Section 2.3(a) which notice the
Payments Administrator believes in good faith to have been given by a
duly authorized officer or other individual authorized to request
Revolving Loans on behalf of the Borrower or for otherwise acting
reasonably and in good faith under this Section 2.3(a) and, upon the
funding of Revolving Loans by the Lenders in accordance with this Credit
Agreement, pursuant to any such telephonic notice, the Borrower shall be
deemed to have made a Borrowing of Revolving Loans hereunder.
(iii) In a Notice of Borrowing, the Borrower may request one or
more Borrowings on a single day. Each such Borrowing shall, unless
otherwise specifically provided herein, consist entirely of Revolving
Loans of the same Type and shall be in an aggregate amount for all
Lenders of not less than $1,000,000 in the case of Eurodollar Rate Loans
or $500,000 in the case of Base Rate Loans. Unless otherwise requested
in the applicable Notice of Borrowing, all Revolving Loans shall be Base
Rate Loans. The right of the Borrower to choose Eurodollar Rate Loans is
subject to the provisions of Section 4.3(c).
(iv) Notwithstanding the foregoing, the Borrower may not incur
Eurodollar Rate Loans prior to the Syndication Date, except that the
Borrower may incur (to the extent it has not elected to Convert Base
Rate Loans into such Eurodollar Rate Loans) one Borrowing of Eurodollar
Rate Loans with one month Interest Period on or prior to the fifth day
following the Closing Date.
(b) The Borrower has informed the Agent that it has decided to
open a checking account (the "Disbursement Account") with Bankers Trust
(Delaware) ("BT Delaware") for general corporate purposes, including the purpose
of paying trade payables and other operating expenses. The Lenders hereby
authorize the Payments Administrator, and so long as the conditions for
Borrowing in Article 5 remain satisfied, the Payments Administrator on behalf of
the Lenders may but shall not be obligated to make Revolving Loans to cover the
amount of checks presented for payment and other disbursements from the
Disbursement Account. Advice from BT Delaware of amounts required to cover such
amounts will be deemed a sufficient Notice of Borrowing. Such Borrowings shall
be of Base Rate Loans only and will not be subject to the minimum amount
requirement of Section 2.3(a)(iii).
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(c) In the event the Borrower is unable to comply with (i) the
Borrowing Base limitations set forth in Section 2.2(a) or the Inventory Sublimit
or (ii) the conditions precedent to the making of a Revolving Loan or the
issuance of a Letter of Credit set forth in Section 5.2, the Lenders authorize
the Payments Administrator, for the account of the Lenders, to make Agent
Advances to the Borrower for a period commencing on the date the Payments
Administrator first receives a Notice of Borrowing requesting an Agent Advance
until the earlier of (i) the fifteenth Business Day after such date, (ii) the
date the Borrower is again able to comply with the Borrowing Base limitations,
the Inventory Sublimit, and the conditions precedent to the making of Revolving
Loans and issuance of Letters of Credit, or obtains an amendment or waiver with
respect thereto, or (iii) the date the Required Lenders instruct the Payments
Administrator to cease making Agent Advances (in each case, the "Agent Advance
Period"). The Payments Administrator shall not make any Agent Advance to the
extent that at such time the amount of such Agent Advance when added to the
aggregate outstanding amount of other Agent Advances would exceed the lesser of
(A) the remainder of (i) the Total Commitments at such time less (ii) the
Outstandings at such time and (B) the lesser of (x) $10,000,000 or (y) 10% of
the Outstandings at such time.
2.4 Settlements Among the Payments Administrator and the Lenders.
(a) Except as provided in Section 2.4(b), the Payments Administrator shall give
to each Lender prompt notice of each Notice of Borrowing by telecopy, telex,
facsimile or cable. No later than 12:00 Noon New York City time on the date of
each Borrowing representing the incurrence of Revolving Loans (unless the
Closing Date is the date of such incurrence, in which case no later than 11:00
A.M. New York City time on the Closing Date), each Lender will make available
for the account of its Applicable Lending Office, to the Payments Administrator
at its Payment Office, in immediately available funds, its Proportionate Share
of such Borrowing. Unless the Payments Administrator shall have been notified by
any Lender prior to the date of such Borrowing that such Lender does not intend
to make available to the Payments Administrator its portion of such Borrowing to
be made on such date, the Payments Administrator may assume that such Lender
will make such amount available to the Payments Administrator at its Payment
Office on such date of Borrowing, or, if applicable, the Settlement Date (as
defined below) and the Payments Administrator, in reliance upon such assumption,
may but shall not be obligated to make available the amount of the Borrowing to
be provided by such Lender. Except as provided in Section 2.4(b) and subject to
Section 2.4(e), promptly after its receipt of payments from or on behalf of the
Borrower (other than amounts payable to the Agent to reimburse the Agent and any
Issuing Bank for fees and expenses payable solely to them), the Payments
Administrator will cause such payments to be distributed ratably to the Lenders.
The Lenders will apply such payments in accordance with Section 2.6(d).
(b) Unless the Required Lenders have instructed the Payments
Administrator to the contrary, the Payments Administrator on behalf of the
Lenders may
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but shall not be obligated to make Base Rate Loans under Section 2.3 without
prior notice of the proposed Borrowing to the Lenders, as follows:
(i) The amount of each Lender's Proportionate Share of Revolving
Loans shall be computed weekly (or more frequently in the Payment
Administrator's discretion) and shall be adjusted upward or downward on
the basis of the amount of outstanding Revolving Loans as of 5:00 P.M.
New York City time on the last Business Day of the period specified by
the Payments Administrator (such date, the "Settlement Date"). The
Payments Administrator shall deliver to each of the Lenders promptly
after the Settlement Date a summary statement of the amount of
outstanding Revolving Loans for such period. The Lenders shall transfer
to the Payments Administrator, or, subject to Section 2.4(e), the
Payments Administrator shall transfer to the Lenders, such amounts as
are necessary so that (after giving effect to all such transfers) the
amount of Revolving Loans made by each Lender shall be equal to such
Lender's Proportionate Share of the aggregate amount of Revolving Loans
outstanding as of such Settlement Date. If the summary statement is
received by the Lenders prior to 12:00 Noon New York City time on any
Business Day, each Lender shall make the transfers described above in
immediately available funds no later than 3:00 P.M. New York City time
on the day such summary statement was received; and if such summary
statement is received by the Lenders after 12:00 Noon New York City time
on such day, each Lender shall make such transfers no later than 3:00
P.M. New York City time on the next succeeding Business Day. The
obligation of each of the Lenders to transfer such funds shall be
irrevocable and unconditional and without recourse to or warranty by the
Payments Administrator. Each of the Payments Administrator and the
Lenders agree to xxxx their respective books and records on the
Settlement Date to show at all times the dollar amount of their
respective Proportionate Shares of the outstanding Revolving Loans.
(ii) To the extent that the settlement described above shall not
yet have occurred, upon repayment of Revolving Loans by the Borrower,
the Payments Administrator may apply such amounts repaid directly to the
amounts made available by the Payments Administrator pursuant to this
Section 2.4(b).
(iii) Because the Payments Administrator on behalf of the Lenders
may be advancing and/or may be repaid Revolving Loans prior to the time
when the Lenders will actually advance and/or be repaid Revolving Loans,
interest with respect to Revolving Loans shall be allocated by the
Payments Administrator to each Lender and the Payments Administrator in
accordance with the amount of Revolving Loans actually advanced by and
repaid to each Lender and the Payments Administrator and shall accrue
from and including the date such Revolving Loans are so advanced to but
excluding the date such Revolving Loans are either repaid
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by the Borrower in accordance with Section 2.5 or actually settled by
the applicable Lender as described in this Section 2.4(b).
(c) If any amount described in this Section 2.4 is not made
available to the Payments Administrator by a Lender (such Lender being
hereinafter referred to as a "Defaulting Lender") and the Payments Administrator
has made such amount available to the Borrower, the Payments Administrator shall
be entitled to recover such amount on demand from such Defaulting Lender. If
such Defaulting Lender does not pay such amount forthwith upon the Payments
Administrator's demand therefor, the Payments Administrator shall promptly
notify the Borrower and the Borrower shall promptly (but in any event no later
than five Business Days after such demand) pay such amount to the Payments
Administrator. The Payments Administrator shall also be entitled to recover from
such Defaulting Lender and the Borrower, (x) interest on such amount in respect
of each day from the date such corresponding amount was made available by the
Payments Administrator to the Borrower to the date such amount is recovered by
the Payments Administrator, at a rate per annum equal to either (i) if paid by
such Defaulting Lender, the overnight Federal Funds Rate or (ii) if paid by the
Borrower, the then applicable rate of interest, calculated in accordance with
Section 4.1 or Section 4.2 hereof, plus (y) in each case, an amount equal to any
costs (including legal expenses) and losses incurred as a result of the failure
of such Defaulting Lender to provide such amount as provided in this Credit
Agreement; provided, however, that the Payments Administrator shall not be
entitled to demand payment by the Borrower of any amount under clause (y) above
unless demand therefor has been made of the Defaulting Lender and not paid
within five Business Days of such demand. Nothing herein shall be deemed to
relieve any Lender from its duty to fulfill its obligations hereunder or to
prejudice any rights which the Borrower may have against any Lender as a result
of any default by such Lender hereunder, including, without limitation, the
right of the Borrower to seek reimbursement from any Defaulting Lender for any
amounts paid by the Borrower under clause (y) above on account of such
Defaulting Lender's default.
(d) The failure of any Lender to make the Revolving Loan to be
made by it as part of any Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its Revolving Loan on the date of such
Borrowing, but no Lender shall be responsible for the failure of any other
Lender to make the Revolving Loan to be made by such other Lender on the date of
any Borrowing.
(e) Notwithstanding anything contained herein to the contrary, so
long as any Lender is a Defaulting Lender or has rejected or repudiated its
Commitment, the Payments Administrator shall not be obligated to transfer to
such Lender any payments made by the Borrower to the Payments Administrator for
the benefit of such Lender; and, such Lender shall not be entitled to the
sharing of any payments pursuant to Section 2.10. Amounts payable to such Lender
under Section 2.10 shall instead be paid to the Payments
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Administrator. The Payments Administrator may hold and, in its discretion,
re-lend to the Borrower the amount of all such payments received by it for such
Lender. For purposes of voting or consenting to matters with respect to the
Credit Documents and determining Proportionate Share, such Defaulting Lender
shall be deemed not to be a "Lender" and such Lender's Commitment shall be
deemed to be zero (0). This Section 2.4(e) shall remain effective with respect
to such Defaulting Lender until (x) the Obligations under this Agreement shall
have been paid in full to the Payments Administrator and/or the Lenders other
than the Defaulting Lender or (y) the Required Lenders, the Payments
Administrator and the Borrower shall have waived such Defaulting Lender's
default in writing. No Commitment of any Lender shall be increased or otherwise
affected, and performance by the Borrower shall not be excused, by the operation
of this Section 2.4(e).
2.5 Mandatory and Voluntary Payments: Mandatory and Voluntary
Reduction of Commitments. (a) Revolving Loans shall be due and payable without
any demand at any time that (A) the aggregate balance of Revolving Loans and all
Letter of Credit Obligations outstanding at such time exceeds the Borrowing Base
or the Total Commitments, in the amount of such excess and (B) the Inventory
Sublimit is exceeded, in the amount of such excess, provided, that (i) no such
payment shall be required pursuant to the foregoing clauses (A) and (B) as a
result of a Borrowing Base Deficiency during an Agent Advance Period and (ii) if
the then aggregate outstanding principal amount of Revolving Loans is less than
either such excess (after giving effect to the foregoing clause (i)), Letters of
Credit will be required to be cash collateralized (to the satisfaction of the
Collateral Agent) in the amount of such difference.
(b) On the Expiration Date, the Total Commitments (and the
Commitment of each Lender) shall automatically reduce to zero and all
outstanding Revolving Loans shall be repaid in full.
(c) The Borrower shall have the right to prepay the Revolving
Loans, without premium or penalty, in whole or in part at any time and from time
to time on the following terms and conditions: (i) the Borrower shall give the
Agent prior to 12:00 Noon (New York City time) (x) at least one Business Day's
prior written notice (or telephonic notice promptly confirmed in writing) of its
intent to prepay Base Rate Loans and (y) at least three Business Days' prior
written notice (or telephonic notice promptly confirmed in writing) of its
intent to prepay Eurodollar Rate Loans, the amount of such prepayment and the
Types of Loans to be prepaid and, in the case of Eurodollar Rate Loans, the
specific Borrowing or Borrowings pursuant to which made, which notice the Agent
shall promptly transmit to each of the Lenders; and (ii) prepayments of
Eurodollar Rate Loans made pursuant to this Section 2.5(c) may only be made on
the last day of an Interest Period applicable thereto.
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(d) With respect to each repayment of Revolving Loans pursuant to
this Section 2.5, the Borrower may designate the Types of Loans which are to be
repaid and the specific Borrowing(s) pursuant to which made; provided, that (i)
Eurodollar Rate Loans may be designated for repayment as a result of Section
2.5(a) only on the last day of an Interest Period applicable thereto unless all
Eurodollar Rate Loans with Interest Periods ending on such date of required
prepayment and all Base Rate Loans have been paid in full; (ii) if any partial
prepayment of Eurodollar Rate Loans made pursuant to any Borrowing shall reduce
the outstanding Eurodollar Rate Loans made pursuant to such Borrowing to an
amount less than $1,000,000, then such Borrowing may not be continued as a
Borrowing of Eurodollar Rate Loans and any election of an Interest Period with
respect thereto given by the Borrower shall have no force or effect; and (iii)
each repayment of any Revolving Loans made pursuant to a Borrowing shall, except
as provided in Section 2.4(e), be applied pro rata among the Lenders which made
such Revolving Loans. In the absence of a designation by the Borrower as
described in the preceding sentence, the Agent shall, subject to the above, make
such designation in its sole discretion with a view, but no obligation, to
minimize breakage costs.
(e) The Borrower may reduce or terminate the unutilized Total
Commitments at any time and from time to time in whole or in part upon at least
three (3) Business Days' prior written notice to the Agent; provided, however,
that each such reduction must be in an amount not less than $1,000,000 (and in
increments of $100,000 thereafter); and provided further, that (i) if the
Borrower seeks to reduce the Total Commitments to an amount less than
$5,000,000, then the Total Commitments shall be reduced to zero and the Credit
Agreement shall be terminated and (ii) once reduced, the amount of any such
reductions in the Total Commitments may not be reinstated.
(f) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 2.5, on each date after the Closing Date
upon which the Borrower receives any proceeds from any sale or issuance of its
equity (other than any issuance pursuant to the Borrower Warrants) or any
contribution to its capital, an amount equal to 100% of the cash proceeds of the
respective sale, issuance or contribution ((i) net of all reasonable costs
associated therewith, including, without limitation, all due diligence costs and
expenses paid for, or reimbursed by, the Borrower, underwriting or similar fees,
discounts and commissions, attorneys' fees and expenses paid for, or reimbursed
by, the Borrower and other direct costs associated therewith, (ii) excluding any
amount of such cash proceeds which are applied to repay Bridge Senior Notes and
(iii) excluding cash proceeds utilized as described in clause (k)(ii) below)
shall be applied as a mandatory reduction to the Total Commitments.
Notwithstanding the foregoing, after the occurrence, if any, of the Bridge Loan
Conversion Date and so long as Term Notes remain outstanding, the reduction to
the Total Commitments above shall be effected, such that the amount of such
reduction shall be allocated with repayments of the Bridge Senior Notes on a pro
rata
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basis (determined on the ratio of the Average Borrowing Base to the sum of (x)
the Average Borrowing Base and (y) aggregate outstanding Bridge Senior Notes).
(g) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 2.5, on the date of the receipt thereof by
the Borrower, an amount equal to 100% of the proceeds (net of underwriting
discounts and commissions and other reasonable costs associated therewith) of
the incurrence of Indebtedness by the Borrower (other than (i) Indebtedness
permitted to be incurred by Section 8.3 (other than amounts described in Section
2.5(j)) or (ii) any other Indebtedness incurred with the consent of the Required
Lenders, the proceeds of which are applied to repay Bridge Senior Notes) shall
be applied as a mandatory reduction to the Total Commitments. Notwithstanding
the foregoing, after the occurrence, if any, of the Bridge Loan Conversion Date
and so long as Term Notes remain outstanding, the reduction to Total Commitments
above shall be effected, such that the amount of such reduction shall be
allocated with repayments of the Bridge Senior Notes on a pro rata basis
(determined on the ratio of the Average Borrowing Base to the sum of (x) the
Average Borrowing Base and (y) the aggregate outstanding Bridge Senior Notes).
(h) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 2.5, on each date after the Closing Date
upon which the Borrower receives Net Sale Proceeds from any sale of assets
(including capital stock and securities held thereby, but excluding (i) sales of
Inventory in the ordinary course of business, (ii) sales or other dispositions
of assets which do not constitute Collateral and the proceeds of which are
applied to repay Senior Notes, (iii) sales or other dispositions of obsolete or
uneconomic equipment in the ordinary course of business to the extent that the
Borrower has delivered a certificate to the Agent on or prior to such date
stating that it intends to reinvest the Net Sale Proceeds therefrom in
replacement equipment within 180 days after the respective date of sale or
disposition or, in lieu thereof, commit to so invest such Net Sale Proceeds
within 180 days after such date of sale and actually expend the funds pursuant
to such commitment within 365 days after such date of sale or disposition and
(iv) proceeds of sales of assets pursuant to Section 8.1(d)) an amount equal to
100% of the Net Sale Proceeds therefrom shall be applied as a mandatory
reduction of the Total Commitments excluding any amount of such Net Sale
Proceeds which is applied to repay Bridge Senior Notes; provided, however, that
to the extent any Net Sale Proceeds are not required to be applied pursuant to
this Section 2.5(h) as a result of clause (iii) contained in the parenthetical
above, then (x) on the 180th day after the date of the respective sale or
disposition, the Net Sale Proceeds of the respective sale or disposition shall
be applied as otherwise required by this Section 2.5(h) to the extent not
actually used or committed to be used as contemplated by said clause (iii) by
such 180th day and (y) on the 365th day after the date of the respective sale or
disposition, any Net Sale Proceeds of the respective sale or disposition shall
be applied as otherwise required by this Section 2.5(h) to the extent same were
committed to be used within 180 days after the respective date of sale or other
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disposition but were not in fact used by such 365th day as contemplated by said
clause (iii). Notwithstanding the foregoing, in the event of an asset sale
involving Shared Collateral, the reduction to Total Commitments above shall be
effected, such that the amount of such reduction shall be allocated with
repayments of the Bridge Senior Notes on a pro rata basis (determined on the
ratio of the Average Borrowing Base to the sum of (x) the Average Borrowing Base
and (y) the aggregate outstanding Bridge Senior Notes).
(i) Upon the occurrence of a Change of Control, unless the
Required Lenders otherwise consent, the Total Commitments shall automatically be
reduced to zero.
(j) In addition to any mandatory repayments or commitment
reductions pursuant to this Section 2.5, on the date of the receipt thereof by
the Borrower, an amount equal to the amount of proceeds received by the Borrower
pursuant to the issuance of the Permanent Senior Notes that are not used to
repay Bridge Senior Notes shall be used to prepay the Revolving Loans to the
extent Revolving Loans are outstanding (without any reduction to the Total
Commitment at such time).
(k) In addition to any mandatory repayments or commitment
reductions pursuant to this Section 2.5, if the Permanent Senior Notes are
outstanding, and the Borrower receives any cash proceeds from any sale or
issuance of equity (other than any issuance pursuant to the Borrower Warrants)
or contribution to its capital, net of all reasonable costs associated therewith
(including without limitation all due diligence costs and expenses paid for, or
reimbursed by, the Borrower, underwriting or similar fees, discounts and
commissions, attorneys' fees and expenses paid for, or reimbursed by, the
Borrower, and other direct costs associated therewith), the Borrower shall apply
all such proceeds to repay Revolving Loans (without any reduction to the Total
Commitment at such time). On the Business Day after such repayment, the Borrower
shall elect, by written notice to the Agent to either (i) reduce the Total
Commitment (which shall automatically reduce upon such election or upon the
failure by the Borrower to make any election pursuant to this sentence) or (ii)
redeem Permanent Senior Notes in accordance with the "equity clawback"
provisions set forth in the Permanent Senior Note Documents, in which case the
Borrower shall, if no Default or Event of Default shall exist or arise
therefrom, be permitted to redeem Permanent Senior Notes in accordance with the
Permanent Senior Note Documents in an amount not to exceed the lesser of (x) 35%
of the aggregate principal amount of Permanent Senior Notes originally issued
and (y) 50% of the proceeds so received.
(l) In addition to any mandatory repayments or commitment
reductions pursuant to this Section 2.5, on the date of the receipt thereof by
the Borrower, an amount equal to the amount of proceeds received by the Borrower
pursuant to the Capital Contribution (as defined in the Capital Call Agreement)
shall be used to prepay the
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Revolving Loans to the extent Revolving Loans are outstanding (without any
reduction to the Total Commitment at such time).
(m) Any reduction to the Total Commitments pursuant to this
Section 2.5 shall reduce the Commitment of each of the Lenders pro rata.
2.6 Payments and Computations. (a) The Borrower shall make each
payment hereunder and under the Revolving Notes not later than 3:00 P.M. New
York City time on the day when due in Dollars to the Payments Administrator at
its Payment Office in immediately available funds. The Borrower's obligations to
the Lenders with respect to such payments shall be discharged by making such
payments to the Payments Administrator pursuant to this Section 2.6 or, if such
payments are not received prior to the foregoing deadline, by the Payments
Administrator's adding such payments to the principal amount of the Revolving
Loans outstanding by charging such payments to the Borrower's Revolving Loan
account (which charge shall constitute an incurrence of Revolving Loans (that
are Base Rate Loans) in an aggregate principal amount equal to the amount so
charged).
(b)(i) The Borrower shall have established and shall maintain one
or more accounts for the collection of payments made in respect of Accounts
(each, a "Sub- Collection Account") and shall instruct all account debtors on
the Accounts of the Borrower to remit all payments to its Sub-Collection
Account. All amounts received by the Borrower from any account debtor, in
addition to all other cash received from any other source, shall, subject to the
requirements of Section 8.19, upon receipt be deposited into a Sub-Collection
Account.
(ii) The Borrower, the Collateral Agent and financial
institutions selected by the Borrower and acceptable to the Agent, which shall
include PNC so long as PNC is a Lender, (the "Collection Banks") shall enter
into agreements substantially in the form of Exhibit C-1 (as modified, amended
or supplemented from time to time in accordance with the terms hereof and
thereof the "Collection Bank Agreements"), providing, among other things, for
all receipts received in respect of Accounts to be transferred at the end of
each day from each Sub-Collection Account to the appropriate Collection Account.
(iii) The Borrower may close Sub-Collection Accounts and/or open
new Sub-Collection Accounts with the prior written consent of the Collateral
Agent and subject to prior execution and delivery to the Collateral Agent of
Collection Bank Agreements consistent with the provisions of this Section 2.6
and in form and substance satisfactory to the Agent.
(c) Upon the terms and subject to the conditions set forth in the
Collection Bank Agreements, all available amounts held in the Collection
Accounts shall be wired each Business Day into an account (the "Concentration
Account") established pursuant to a con-
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centration account agreement entered into among the Borrower, the Collateral
Agent and BTCo substantially in the form of Exhibit C-2 (the "Concentration
Account Agreement"). Subject to the terms and conditions of the Concentration
Account Agreement, all available funds in the Concentration Account shall be
transferred on every Business Day to an account (the "BT Account") maintained by
the Collateral Agent at BTCo.
(d) All available amounts held in the BT Account shall be
distributed and applied on a daily basis in the following order: first, to the
payment of any Fees, Expenses or other Obligations due and payable to the Agent
under any of the Credit Documents, including amounts advanced by the Payments
Administrator on behalf of the Lenders pursuant to Section 2.3(b), 2.3(c) or
2.4(b) for which invoices have been presented in accordance with Section 4.5(a)
hereof; second, to the payment of any Fees, Expenses or other Obligations due
and payable to any Issuing Bank under any of the Credit Documents; third, to the
ratable payment of any Fees, Expenses or other Obligations due and payable to
the Lenders under any of the Credit Documents other than those Obligations
specifically referred to in this Section 2.6(d); fourth, if required by the
Agent in its Permitted Discretion, to the ratable payment of interest due on the
Revolving Loans; and, fifth, to the ratable payment of principal on the
Revolving Loans. Any payment received hereunder as a distribution in any
proceeding referred to in Section 9.1(e) shall, unless paid with respect to
amounts specifically owing to the Agent or any Issuing Bank, be distributed and
applied by the Collateral Agent to the payment of the amounts due hereunder and
under the Revolving Notes ratably in accordance with such amounts (or, if a
court of competent jurisdiction shall otherwise specify, as specified by such
court).
2.7 Maintenance of Account. The Payments Administrator shall
maintain an account on its books in the name of the Borrower in which the
Borrower will be charged with all loans and advances made by the Lenders to the
Borrower or for the Borrower's account, including the Revolving Loans, the
Letter of Credit Obligations, the Fees, the Expenses and any other Obligations.
The Borrower will be credited, in accordance with Section 2.6 above, with all
amounts received by the Lenders from the Borrower or from others for the
Borrower's account, including, as set forth above, all amounts received by the
Payments Administrator in payment of Accounts and applied to the Obligations. In
no event shall prior recourse to any Accounts or other Collateral be a
prerequisite to the Payments Administrator's right to demand payment of any
Obligation upon its maturity. Further, the Payments Administrator shall have no
obligation whatsoever to perform in any respect any of the Borrower's contracts
or obligations relating to the Accounts.
2.8 Statement of Account. After the end of each month the
Payments Administrator shall send the Borrower a statement accounting for the
charges, loans, advances and other transactions occurring among and between the
Agent, the Lenders, the Issuing Banks and the Borrower during that month. The
monthly statements shall, absent
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manifest error, be an account stated, which is final, conclusive and binding on
the Borrower.
2.9 Taxes. (a) All payments made by the Borrower hereunder, under
any Revolving Note, or under any other Credit Document will be made without
setoff, counterclaim or other defense. Except as provided in Section 2.9(b), all
such payments will be made free and clear of, and without deduction or
withholding for, any present or future taxes, levies, imposts, duties, fees,
assessments or other charges of whatever nature now or hereafter imposed by any
jurisdiction or by any political subdivision or taxing authority thereof or
therein with respect to such payments (but excluding, except as provided in the
second succeeding sentence, any tax imposed on or measured by the net income or
net profits of a Lender pursuant to the laws of the jurisdiction in which such
Lender is organized or the jurisdiction in which the principal office or
Applicable Lending Office of such Lender is located or any subdivision thereof
or therein) and all interest, penalties or similar liabilities with respect
thereto (all such non-excluded taxes, levies, imposts, duties, fees, assessments
or other charges being referred to collectively as "Taxes"). If any Taxes are so
levied or imposed, the Borrower agrees to pay the full amount of such Taxes, and
such additional amounts as may be necessary so that every payment of all amounts
due hereunder, under any Revolving Note, or under any other Credit Document,
after withholding or deduction for or on account of any Taxes, will not be less
than the amount provided for herein or in such Revolving Note or such other
Credit Document. If any amounts are payable in respect of Taxes pursuant to the
preceding sentence, the Borrower agrees to reimburse each Lender, upon the
written request of such Lender, for taxes imposed on or measured by the net
income or net profits of such Lender pursuant to the laws of the jurisdiction in
which such Lender is organized or incorporated or in which the principal office
or Applicable Lending Office of such Lender is located or of any political
subdivision or taxing authority thereof or therein and for any withholding of
income or similar taxes as such Lender shall determine are payable by, or
withheld from, such Lender in respect of such amounts so paid to or on behalf of
such Lender pursuant to this or the preceding sentence. The Borrower will
furnish to the Payments Administrator within 45 days after the date the payment
of any Taxes, or any withholding or deduction on account thereof, is due
pursuant to applicable law certified copies of tax receipts evidencing such
payment by the Borrower. The Borrower will indemnify and hold harmless the Agent
and each Lender, and reimburse the Agent or such Lender upon its written
request, for the amount of any Taxes so levied or imposed and paid or withheld
by such Lender.
(b) Each Lender that is not a United States person (as such term
is defined in Section 7701(a)(30) of the Code) for U.S. Federal Income Tax
purposes agrees to deliver to the Borrower and the Agent on or prior to the
Closing Date, or in the case of a Lender that is an assignee or transferee of an
interest under this Agreement pursuant to Section 11.6 (unless the respective
Lender was already a Lender hereunder immediately prior to such assignment or
transfer), on the date of such assignment or transfer to such Lender,
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(i) two accurate and complete original signed copies of Internal Revenue Service
Form 4224 or 1001 (or successor forms) certifying to such Lender's entitlement
to a complete exemption from United States withholding tax with respect to
payments to be made under this Credit Agreement and under any Revolving Note, or
(ii) if the Lender is not a "bank" within the meaning of Section 881(c)(3)(A) of
the Code and cannot deliver either Internal Revenue Service Form 1001 or 4224
pursuant to clause (i) above, (x) a certificate substantially in the form of
Exhibit D (any such certificate, a "Section 2.9(b)(ii) Certificate") and (y) two
accurate and complete original signed copies of Internal Revenue Service Form
W-8 (or successor form) certifying to such Lender's entitlement to a complete
exemption from United States withholding tax with respect to payments of
interest to be made under this Agreement and under any Revolving Note. In
addition, each Lender agrees that from time to time after the Closing Date, when
a lapse in time or change in circumstances renders the previous certification
obsolete or inaccurate in any material respect, it will deliver to the Borrower
and the Agent two new accurate and complete original signed copies of Internal
Revenue Service Form 4224 or 1001, or Form W-8 and a Section 2.9(b)(ii)
Certificate, as the case may be, and such other forms as may be required in
order to confirm or establish the entitlement of such Lender to a continued
exemption from or reduction in United States withholding tax with respect to
payments under this Agreement and any Revolving Note, or it shall immediately
notify the Borrower and the Agent of its inability to deliver any such Form or
Certificate, in which case such Lender shall not be required to deliver any such
Form or Certificate pursuant to this Section 2.9(b). Notwithstanding anything to
the contrary contained in Section 2.9(a), but subject to Section 11.6 and the
immediately succeeding sentence, (x) the Borrower shall be entitled, to the
extent it is required to do so by law, to deduct or withhold income or similar
taxes imposed by the United States (or any political subdivision or taxing
authority thereof or therein) from interest, fees or other amounts payable
hereunder for the account of any Lender which is not a United States person (as
such term is defined in Section 7701(a)(30) of the Code) for U.S. Federal income
tax purposes to the extent that such Lender has not provided to the Borrower
U.S. Internal Revenue Service Forms that establish a complete exemption from
such deduction or withholding and (y) the Borrower shall not be obligated
pursuant to Section 2.9(a) to gross-up payments to be made to a Lender in
respect of income or similar taxes imposed by the United States (I) if such
Lender has not provided to the Borrower the Internal Revenue Service Forms
required to be provided to the Borrower pursuant to this Section 2.9(b) or (II)
in the case of a payment, other than interest, to a Lender described in clause
(ii) above, to the extent that such Forms do not establish a complete exemption
from withholding of such taxes. Notwithstanding anything to the contrary
contained in the preceding sentence or elsewhere in this Section 2.9 and except
as set forth in Section 11.6, the Borrower agrees to pay additional amounts and
to indemnify each Lender in the manner set forth in Section 2.9(a) (without
regard to the identity of the jurisdiction requiring the deduction or
withholding) in respect of any Taxes deducted or withheld by it as described in
the immediately preceding sentence as a result of any changes after the Closing
Date (or, if later, the date such Lender became party to
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this Agreement) in any applicable law, treaty, governmental rule, regulation,
guideline or order, or in the interpretation thereof, relating to the deducting
or withholding of such Taxes.
2.10 Sharing of Payments. If any Lender shall obtain any payment
(whether voluntary, involuntary, through the exercise of any right of set-off or
otherwise) on account of the Revolving Loans made by it or its participation in
Letters of Credit in excess of its Proportionate Share of payments on account of
the Revolving Loans or Letters of Credit obtained by all the Lenders (other than
any Lender that has waived its Proportionate Share in writing), such Lender
shall forthwith purchase from the other Lenders such participation in the
Revolving Loans made by them or in their participation in Letters of Credit as
shall be necessary to cause such purchasing Lender to share the excess payment
ratably with each of them; provided, however, that if all or any portion of such
excess payment is thereafter recovered from such purchasing Lender, such
purchase from each Lender shall be rescinded and each such Lender shall repay to
the purchasing Lender the purchase price to the extent of such recovery together
with an amount equal to such Lender's ratable share (according to the proportion
of (i) the amount of such Lender's required repayment to (ii) the total amount
so recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect to the total amount so recovered.
The Borrower agrees that any Lender so purchasing a participation from another
Lender pursuant to this Section 2.10 may, to the fullest extent permitted by
law, exercise all of its rights of payment (including the right of set-off) with
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation.
ARTICLE 3.
Letters of Credit
3.1 Issuance of Letters of Credit. Subject to the terms and
conditions of this Credit Agreement and in reliance upon the representations and
warranties of the Borrower set forth herein, upon the request of the Borrower
pursuant to Section 3.4, one or more Issuing Banks selected by the Borrower
shall issue Letters of Credit hereunder and for the Borrower's account, as more
specifically described below. No Issuing Bank shall be obligated to issue any
Letter of Credit for the account of the Borrower if at the time of such
requested issuance:
(a) The face amount of such requested Letter of Credit when added
to the Letter of Credit Obligations then outstanding, would (i) cause
the Letter of Credit Obligations to exceed $15,000,000 or (ii) when
added to the aggregate amount of Revolving Loans then outstanding would
exceed (x) the lesser of (A) the Total
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Commitments and (B) the Borrowing Base then in effect or (y) the
Inventory Sublimit;
(b) Any order, judgment or decree of any Governmental Authority
or arbitrator shall purport by its terms to enjoin or restrain such
Issuing Bank from issuing such Letter of Credit or any Requirement of
Law applicable to such Issuing Bank or any request or directive (whether
or not having the force of law) from any Governmental Authority with
jurisdiction over such Issuing Bank shall prohibit, or request such
Issuing Bank to refrain from, the issuance of letters of credit
generally or such Letter of Credit in particular or shall impose upon
such Issuing Bank with respect to such Letter of Credit any restriction
or reserve or capital requirement (for which such Issuing Bank is not
otherwise compensated) not in effect as of the Closing Date, or any
unreimbursed loss, cost or expense which was not applicable, in effect
or known to such Issuing Bank as of the Closing Date and which such
Issuing Bank deems in good faith to be material to it; or
(c) A default of any Lender's obligations to fund under Section
3.6 exists, or such Lender is a Defaulting Lender under Section 2.4(c),
or any Lender has rejected or repudiated its obligations in respect of
Letters of Credit, unless the Agent and the Issuing Banks have entered
into satisfactory arrangements with the Borrower to eliminate such
Issuing Bank's risk with respect to such Lender, including cash
collateralization of such Lender's Proportionate Share of the Letter of
Credit Obligations.
3.2 Terms of Letters of Credit. The Letters of Credit shall be in
a form customarily issued by the respective Issuing Bank or in such other form
as has been approved by such Issuing Bank. Each Letter of Credit shall be
denominated in Dollars. At the time of issuance, the amount and the terms and
conditions of each Letter of Credit, and the form of any drafts or acceptances
thereunder, shall be subject to approval by the Agent and the Borrower. In no
event may the term of any standby Letter of Credit issued hereunder exceed 12
months (except that such Letters of Credit may provide for annual renewal) nor
the term of any documentary Letter of Credit exceed 180 days, and all Letters of
Credit issued hereunder shall expire no later than the date that is five
Business Days prior to the Expiration Date. Any Letter of Credit containing an
automatic renewal provision shall also contain a provision pursuant to which,
notwithstanding any other provisions thereof, it shall expire no later than the
date that is five Business Days prior to the Expiration Date.
3.3 Lenders' Participation. Immediately upon the issuance or
amendment by any Issuing Bank of any Letter of Credit in accordance with the
procedures set forth in Section 3.1, each Lender shall be deemed to have
irrevocably and unconditionally purchased and received from such Issuing Bank,
without recourse or warranty, an undivided
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interest and participation to the extent of such Lender's Proportionate Share
(based upon its Commitment) of the liability with respect to such Letter of
Credit (including, without limitation, all obligations of the Borrower with
respect thereto, other than amounts owing to such Issuing Bank consisting of
Issuing Bank Fees or Facing Fees) and any security therefor or guaranty
pertaining thereto.
3.4 Notice of Issuance. Whenever the Borrower desires the
issuance of a Letter of Credit, the Borrower shall deliver to the Payments
Administrator and the respective Issuing Bank a written notice no later than
1:00 P.M. New York City time at least three Business Days (or such shorter
period as may be agreed to by such Issuing Bank) in advance of the proposed date
of issuance of a letter of credit request in substantially the form attached as
Exhibit B-2 (a "Letter of Credit Request"). The Payments Administrator shall
promptly transmit copies of each Letter of Credit Request to each Lender. The
transmittal by the Borrower of each Letter of Credit Request shall be deemed to
be a representation and warranty by the Borrower that the Letter of Credit may
be issued in accordance with and will not violate any of the requirements of
Section 3.1 or 5.2. A Letter of Credit Request may be given in writing or
electronically with prompt confirmation in writing.
3.5 Payment of Amount Drawn Under Letters of Credit. In the event
of any request for drawing under any Letter of Credit by the beneficiary
thereof, the respective Issuing Bank shall notify the Payments Administrator,
which shall notify the Borrower of such request, not later than 11:00 A.M. on
the Business Day immediately prior to the date on which such Issuing Bank
intends to honor such drawing. The Borrower shall give notice to be received by
the Payments Administrator and the Issuing Bank not later than 1:00 P.M. on such
Business Day if it intends to reimburse such Issuing Bank for the amount of such
drawing with funds other than the proceeds of Revolving Loans. Such notice from
the Borrower shall be irrevocable and, if given, the Borrower shall reimburse
such Issuing Bank not later than the close of business New York City time on the
day on which such drawing is honored in an amount in same day funds equal to the
amount of such drawing. If the Payments Administrator shall not have timely
received such notice (i) the Borrower shall be deemed to have timely given a
Notice of Borrowing to the Payments Administrator to incur Revolving Loans on
the date on which such drawing is honored in an amount equal to the amount of
such drawing and (ii) subject to satisfaction or waiver of the conditions
specified in Section 5.2 hereof and the other terms and conditions of Borrowings
contained herein, the Lenders shall, on the date of such drawing, make Revolving
Loans in the amount of such drawing, the proceeds of which shall be applied
directly by the Payments Administrator to reimburse such Issuing Bank for the
amount of such drawing or payment. Borrowings pursuant to this Section 3.5 shall
not be subject to the minimum amount requirement of Section 2.3(a)(iii). If for
any reason, proceeds of Revolving Loans are not received by such Issuing Bank on
such date in an amount equal to the amount of such drawing, the Borrower shall
be obligated to and shall reimburse such
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Issuing Bank, on the Business Day immediately following the date of such
drawing, in an amount in same day funds equal to the excess of the amount of
such drawing over the amount of such Revolving Loans, if any, which are so
received, plus accrued interest on such amount at the rate set forth in Section
4.2; provided, however, that any such payments shall not prejudice any rights
that the Borrower may have against any Lender as a result of any default by such
Lender in funding such Revolving Loans, as provided in the final sentence of
Section 2.4(c).
3.6 Payment by Lenders. (a) In the event that the Borrower does
not reimburse an Issuing Bank for the amount of any drawing pursuant to Section
3.5 and the proceeds of Revolving Loans incurred for such purpose are
insufficient for such purpose, the Payments Administrator shall promptly notify
each Lender of the unreimbursed amount and of such Lender's respective
participation therein. Each Lender shall make available to such Issuing Bank an
amount equal to its respective participation in same day funds, at the office of
such Issuing Bank specified in such notice, not later than 1:00 P.M. New York
City time on the Business Day after the date notified by the Payments
Administrator. In the event that any Lender fails to make available to the
Issuing Bank the amount of such Lender's participation in such Letter of Credit
as provided in this Section 3.6, such Issuing Bank shall be entitled to recover
such amount on demand from such Lender, together with interest at the Federal
Funds Rate.
(b) The Payments Administrator or any Issuing Bank, as the case
may be, shall distribute to each Lender which has paid all amounts payable by it
under this Section 3.6 with respect to any Letter of Credit such Lender's
Proportionate Share of all payments subsequently received by the Payments
Administrator or the respective Issuing Bank, as the case may be, from the
Borrower in reimbursement of drawings honored under such Letter of Credit when
such payments are received.
3.7 Nature of Issuing Bank's Duties. In determining whether to
pay under any Letter of Credit, each Issuing Bank shall be responsible only to
determine that the documents and certificates required to be delivered under
that Letter of Credit have been delivered and that they substantially comply on
their face with the requirements of that Letter of Credit. As between the
Borrower, an Issuing Bank and each other Lender, the Borrower assumes all risks
of the acts and omissions of, or misuse of the Letter of Credit issued by each
Issuing Bank by, the respective beneficiaries of such Letter of Credit. In
furtherance and not in limitation of the foregoing, no Issuing Bank nor any of
the other Lenders shall be responsible (i) for the form, validity, sufficiency,
accuracy, genuineness or legal effects of any document submitted by any party in
connection with the application for and issuance of or any drawing honored under
such Letter of Credit even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or forged, (ii) for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign such Letter of Credit, or the rights or
benefits thereunder
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or proceeds thereof, in whole or in part, which may prove to be invalid or
ineffective for any reason, (iii) for errors, omissions, interruptions or delays
in transmission or delivery of any messages, by mail, cable, telegraph, telex,
telecopy, facsimile or otherwise, whether or not they be in cipher, (iv) for
errors in interpretation of technical terms, (v) for any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under any such Letter of Credit, or of the proceeds thereof, (vi) for the
misapplication by the beneficiary of such Letter of Credit of the proceeds of
any drawing honored under such Letter of Credit, and (vii) for any consequences
arising from actions or omissions taken or omitted in good faith or from causes
beyond the control of such Issuing Bank or the other Lenders; provided, however
that nothing in this sentence shall relieve an Issuing Bank of liability for its
own gross negligence or willful misconduct.
3.8 Obligations Absolute. The obligations of the Borrower to
reimburse an Issuing Bank for drawings honored under a Letter of Credit issued
by it and the obligations of the Lenders under Section 3.6 shall be
unconditional and irrevocable and shall be paid strictly in accordance with the
terms of this Credit Agreement under all circumstances including, without
limitation, the following circumstances:
(a) any lack of validity or enforceability of any Letter of
Credit;
(b) the existence of any claim, set-off, defense or other right
which the Borrower or any Affiliate of the Borrower may have at any time
against a beneficiary or any transferee of any Letter of Credit (or any
Persons or entities for whom any such beneficiary or transferee may be
acting), such Issuing Bank, any Lender or any other Person, whether in
connection with this Credit Agreement, the transactions contemplated
herein or any unrelated transaction, provided, however, that nothing
contained herein shall preclude the Borrower from asserting any such
claim, defense or counterclaim in a separate judicial proceeding or by
compulsory counterclaim;
(c) any draft, demand, certificate or any other documents
presented under any Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect;
(d) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents;
(e) failure of any drawing under a Letter of Credit or any
non-application or misapplication by the beneficiary of the proceeds of
any drawing; or
(f) the fact that a Default or Event of Default shall have
occurred and be continuing;
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provided, however, that the Borrower shall have no obligation to reimburse an
Issuing Bank and the Lenders shall have no obligation under Section 3.6 in the
event of such Issuing Bank's willful misconduct or gross negligence in
determining whether documents presented under the Letter of Credit comply with
the terms of such Letter of Credit or with respect to any other express
obligation an Issuing Bank may have under this Credit Agreement in making any
payment pursuant to any Letter of Credit.
ARTICLE 4.
Interest, Fees and Expenses
4.1 Interest on Eurodollar Rate Loans. Subject to the provisions
of Section 4.4 hereof, interest on Eurodollar Rate Loans shall be payable on the
last day of each Interest Period with respect to such Eurodollar Rate Loans
(and, if earlier, the date three months after the date of the incurrence,
Conversion or Continuance thereof), at the date of any Conversion thereof (or
portion thereof) to a Base Rate Loan, upon any prepayment (on the amount
prepaid) and at maturity at an interest rate per annum equal during each
Interest Period for such Eurodollar Rate Loan to the Adjusted Eurodollar Rate in
effect for such Interest Period in effect for such Eurodollar Rate Loan plus the
relevant Applicable Margin. The Payments Administrator upon determining the
Adjusted Eurodollar Rate for any Interest Period shall promptly notify the
Borrower and the Lenders thereof. Each determination by the Payments
Administrator of an interest rate hereunder shall be conclusive and binding for
all purposes, absent manifest error.
4.2 Interest on Base Rate Loans. Subject to the provisions of
Section 4.4 hereof, interest on Base Rate Loans shall be payable monthly as of
the end of each month, and at maturity at an interest rate per annum equal to
the Base Rate plus the relevant Applicable Margin. Each determination by the
Payments Administrator of an interest rate hereunder shall be conclusive and
binding for all purposes, absent manifest error.
4.3 Notice of Continuation and Notice of Conversion. (a) With
respect to any Borrowing consisting of Eurodollar Rate Loans, the Borrower may,
subject to the provisions of Section 4.3(c) and the condition that no Default or
Event of Default then exists, elect to maintain such Borrowing or any portion
thereof equal to at least $1,000,000 as Eurodollar Rate Loans by selecting a new
Interest Period for such Borrowing (or portion thereof), which new Interest
Period shall commence on the last day of the immediately preceding Interest
Period. Each selection of a new Interest Period (a "Continuation") shall be made
by notice given not later than 12:00 P.M. New York City time on the third
Business Day prior to the date of any such Continuation, by the Borrower to the
Payments Administrator. Such notice (a "Notice of Continuation") shall be by
telephone, telecopy, telex, facsimile or cable, confirmed immediately in writing
if by telephone, in substantially the
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form of Exhibit B-3, which shall be completed in such manner as is necessary to
comply with all limitations on Revolving Loans outstanding hereunder. If the
Borrower shall fail to, or does not have the right to, select a new Interest
Period for any Borrowing consisting of Eurodollar Rate Loans in accordance with
this Section 4.3(a), such Loans will automatically, on the last day of the then
existing Interest Period therefor, Convert into Base Rate Loans.
(b) The Borrower may on any Business Day occurring on or after
the Syndication Date (provided that no Default or Event of Default has occurred
and is continuing), upon notice (each such notice, a "Notice of Conversion")
given to the Payments Administrator, and subject to the provisions of Section
4.3(c), Convert the entire amount of or a portion of Revolving Loans of one Type
into a Borrowing of Revolving Loans of the other Type; provided, however, that
any Conversion of any Eurodollar Rate Loans into Base Rate Loans shall be made
on, and only on, the last day of an Interest Period for such Eurodollar Rate
Loans; provided further, however, the Borrower may elect (to the extent it has
not elected to make a Borrowing of such Eurodollar Rate Loans) make one
Conversion of Base Rate Loans into Eurodollar Rate Loans having a one month
Interest Period on or prior to the fifth day following the Closing Date. Each
such Notice of Conversion shall be given not later than 12:00 P.M. New York City
time on the Business Day prior to the date of any proposed Conversion into Base
Rate Loans and on the third Business Day prior to the date of any proposed
Conversion into Eurodollar Rate Loans. Subject to the restrictions specified
above, each Notice of Conversion shall be by telephone, telecopy, telex,
facsimile or cable, confirmed immediately in writing if by telephone, in
substantially the form of Exhibit B-4. Each Conversion shall be in an aggregate
amount for the Revolving Loans of all Lenders of not less than $1,000,000.
(c) Notwithstanding anything contained in Section 2.3 or Sections
4.3(a) and (b) above to the contrary,
(i) if the Payments Administrator is unable to determine the
Adjusted Eurodollar Rate for Eurodollar Rate Loans comprising any
requested Borrowing, Continuation or Conversion, the right of the
Borrower to select or maintain Eurodollar Rate Loans for such Borrowing
or any subsequent Borrowing shall be suspended until the Payments
Administrator shall notify the Borrower and the Lenders that the
circumstances causing such suspension no longer exist, and each
Revolving Loan comprising such Borrowing shall be made as, or Converted
into, a Base Rate Loan;
(ii) if the Required Lenders shall, at least one Business Day
before the date of any requested Borrowing, Continuation or Conversion,
notify the Payments Administrator that the Adjusted Eurodollar Rate for
Revolving Loans comprising such Borrowing will not adequately reflect
the cost to such Lenders of making or
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funding their respective Revolving Loans for such Borrowing, the right
of the Borrower to select Eurodollar Rate Loans for such Borrowing shall
be suspended until the Payments Administrator shall notify the Borrower
and the Lenders that the circumstances causing such suspension no longer
exist, and each Revolving Loan comprising such Borrowing shall be made
as, or Converted into, a Base Rate Loan; and
(iii) there shall not be at any one time more than five (5)
Interest Periods in effect with respect to Eurodollar Rate Loans.
(d) Each Notice of Continuation and Notice of Conversion shall be
irrevocable by and binding on the Borrower. In the case of any Borrowing,
Continuation or Conversion that the related Notice of Borrowing, Notice of
Continuation or Notice of Conversion specifies is to be comprised of Eurodollar
Rate Loans, the Borrower shall indemnify each Lender against any loss, cost or
expense incurred by such Lender as a result of any failure to fulfill, on or
before the date for such Borrowing, Continuation or Conversion specified in such
Notice of Borrowing, Notice of Continuation or Notice of Conversion, the
applicable conditions set forth in Article 5, including, without limitation, any
loss (excluding loss of anticipated profits), cost or expense incurred by reason
of the liquidation or re-employment of deposits or other funds acquired by such
Lender to fund the Eurodollar Rate Loan to be made by such Lender as part of
such Borrowing, Continuation or Conversion.
4.4 Interest After Default. Interest on any amount of matured
principal of the Revolving Loans, and interest on the amount of principal of the
Revolving Loans outstanding as of the date an Event of Default under Section
9.1(a) or (c)(i) occurs, and at all times thereafter until the earlier of the
date upon which (i) all Obligations have been paid and satisfied in full or (ii)
such Event of Default shall have been cured or waived, shall be payable on
demand at a rate equal to the rate at which the Revolving Loans are bearing
interest pursuant to Sections 4.1 or 4.2 above plus 2%, or, if higher, the Base
Rate in effect from time to time plus the sum of (x) the Applicable Margin for
Base Rate Loans then in effect and (y) 2%.
4.5 Reimbursement of Expenses. (a) From and after the Closing
Date, the Borrower shall promptly reimburse the Agent for all Expenses of the
Agent as the same are incurred by the Agent and upon receipt of invoices
therefor and, if requested by the Borrower, such reasonable backup materials and
information (other than backup materials and information relating to the
calculation of breakage costs) as the Borrower shall reasonably request.
(b) If any payment of principal of, or any Conversion of, any
Eurodollar Rate Loan is made other than on the last day of an Interest Period
applicable thereto for any
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reason, the Borrower shall, upon demand by any Lender (with a copy of such
demand to the Payments Administrator), pay to the Payments Administrator for the
account of such Lender any amounts required to compensate such Lender for any
additional losses, costs or expenses which it may reasonably incur as a result
of such payment, including, without limitation, any loss (excluding loss of
anticipated profits), cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by any Lender to fund or
maintain such Eurodollar Rate Loan.
4.6 Unused Line Fee. The Borrower shall pay to the Payments
Administrator for the benefit of each of the Lenders (other than a Defaulting
Lender for so long as such Lender is a Defaulting Lender) a non-refundable fee
(the "Unused Line Fee") equal to one-half of one percent (.50%) per annum on the
unused portion of such Lender's Commitment, which fee shall (i) accrue from the
date this Credit Agreement becomes effective pursuant to Section 11.14 until the
Expiration Date and (ii) be due and payable quarterly in arrears on the last
Business Day of March, June, September and December, and on the Expiration Date
or any earlier date on which the Total Commitment is terminated.
4.7 Letter of Credit Fees. (a) The Payments Administrator shall
be entitled to charge to the account of the Borrower (i) for the ratable benefit
of the Lenders, a fee (the "Letter of Credit Fee"), in an amount equal to the
Applicable Margin for Eurodollar Rate Loans per annum of the daily weighted
average amount of outstanding Letter of Credit Obligations during the
immediately preceding quarter, due and payable quarterly in arrears on the last
Business Day of March, June, September and December, and on the Expiration Date
or any earlier date on which all Letters of Credit have been terminated, (ii)
for the account of each Issuing Bank, a fee (the "Facing Fee"), in an amount
equal to one quarter of one percent (.25%) per annum of the daily weighted
average amount of Letters of Credit issued by it during the immediately
proceeding quarter, due and payable quarterly in arrears on the last Business
Day of March, June, September and December, and on the Expiration Date or any
earlier date on which the Letters of Credit have been terminated and (iii) as
and when incurred by the Payments Administrator or any Lender, any charges,
fees, costs and expenses charged to the Payments Administrator or any Lender for
the Borrower's account by any Issuing Bank (other than any fees charged to the
Payments Administrator or any Lender which would be duplicative of the Letter of
Credit Fee paid to the Payments Administrator for the benefit of the Lenders)
(the "Issuing Bank Fees") in connection with the issuance of any Letters of
Credit by any Issuing Bank. Each determination by the Payments Administrator of
Letter of Credit Fees hereunder shall be conclusive and binding for all
purposes, absent manifest error.
(b) Letter of Credit Fees payable in respect of Letter of Credit
Obligations outstanding as of the date an Event of Default under Section 9.1(a)
or (c) occurs, and at all times thereafter until the earlier of the date upon
which (i) all Obligations have been paid
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and satisfied in full or (ii) such Event of Default shall have been cured or
waived, shall be payable on demand at a rate equal to the rate at which the
Letter of Credit Fees are charged pursuant to Section 4.7(a) above, plus 2%.
4.8 Other Fees and Expenses. The Borrower agrees to pay (i) fees
to BTCC in the amounts and at the times set forth in the Fee Letter, (ii)
expenses to PNC in the amounts and at the times set forth in the PNC Expense
Letter and (iii) shall be obligated to reimburse the Agent's Expenses promptly
upon demand.
4.9 Authorization to Charge Account. The Borrower hereby
authorizes the Payments Administrator, subject to prior notice to the Borrower,
to charge the Borrower's Revolving Loan account with the amount of all Fees,
Expenses and other payments to be paid hereunder, under the Fee Letter and under
the other Credit Documents as and when such payments become due. The Borrower
confirms that any charges which the Payments Administrator may so make to the
Borrower's Revolving Loan account as herein provided will be made as an
accommodation to the Borrower and solely at the Payments Administrator's
discretion.
4.10 Indemnification in Certain Events. (a) If after the Closing
Date, either (i) any change in or in the interpretation of any law or regulation
is introduced, including, without limitation, with respect to reserve
requirements, applicable to the Agent, any Issuing Bank or any of the Lenders
(or, in the case of a Lender which is not a banking institution, any Affiliate
of such Lender funding such Lender ("Funding Affiliate")), or (ii) the Agent,
any Issuing Bank, or any of the Lenders (or, in the case of a Lender which is
not a banking institution, any Funding Affiliate) complies with any future
guideline or request from any central bank or other Governmental Authority or
(iii) the Agent, any Issuing Bank, or any of the Lenders (or, in the case of a
Lender which is not a banking institution, any Funding Affiliate) reasonably
determines that the adoption of any applicable law, rule or regulation regarding
capital adequacy, or any change therein, or any change in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof has or would
have the effect described below, or the Agent, any Issuing Bank, or any of the
Lenders (or, in the case of a Lender which is not a banking institution, any
Funding Affiliate) complies with any future request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, and in the case of any event set forth in
this clause (iii), such adoption, change or compliance has or would have the
direct or indirect effect of reducing the rate of return on any of such Person's
(or any Funding Affiliate's) capital as a consequence of its obligations
hereunder to a level below that which such Person could have achieved but for
such adoption, change or compliance (taking into consideration such Person's (or
any Funding Affiliate's) policies with respect to capital adequacy) by an amount
deemed by such Person to be material, and any of the foregoing events described
in clauses (i), (ii) or (iii) increases the cost to the
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Agent, any Issuing Bank or any of the Lenders of (A) funding or maintaining its
Commitment or (B) issuing, making or maintaining any Letter of Credit or of
purchasing or maintaining any participation therein, or reduces the amount
receivable in respect thereof by the Agent, any Issuing Bank or any Lender, then
the Borrower shall within 10 days after demand by the Agent, pay to the Payments
Administrator, for the account of each applicable Lender or Issuing Bank, as the
case may be, additional amounts sufficient to indemnify the Agent, the Lenders
or Issuing Banks against such increase in cost or reduction in amount receivable
allocable to the Agent's, such Lenders' or Issuing Banks', as the case may be,
funding or maintaining its Commitment or issuing, making or maintaining any
Letter of Credit or purchasing or maintaining any participation therein. A
certificate as to the amount of such increased cost and setting forth in
reasonable detail the calculation thereof shall be submitted to the Borrower by
the Agent, or the applicable Lender or Issuing Bank, as the case may be, and
shall be conclusive absent manifest error.
(b) Each Lender, Issuing Bank or the Agent will notify the
Borrower and the Payments Administrator of any event occurring after the Closing
Date which will entitle such Lender, Issuing Bank or Agent to payment pursuant
to Section 4.10(a) as promptly as practicable after it obtains knowledge
thereof, specifying the event giving rise to such claim and setting out in
reasonable detail an estimate of the basis and computation of such claim. Upon
receipt of such notice, the Borrower shall compensate such Lender, Issuing Bank
or Agent in accordance with Section 4.10(a) from the date such costs are
incurred (including, without limitation, where such costs are retroactively
applied); provided, however, that the Borrower shall not be required to
compensate a Lender, Issuing Bank or Agent for costs incurred earlier than 150
days prior to the date of the notice required to be delivered to the Borrower
pursuant to this Section 4.10(b).
4.11 Calculations. All calculations of (i) interest hereunder and
(ii) Fees, including, without limitation, Unused Line Fees, Letter of Credit Fee
and Facing Fees, shall be made by the Payments Administrator, on the basis of a
year of 360 days, or, if such computation would cause the interest and Fees
chargeable hereunder to exceed the Highest Lawful Rate, 365/366 days, in each
case for the actual number of days elapsed (including the first day but
excluding the last day) occurring in the period for which such interest or Fees
are payable. Each determination by the Payments Administrator of an interest
rate or payment hereunder shall be conclusive and binding for all purposes,
absent manifest error.
4.12 Change of Applicable Lending Office. Each Lender agrees that
on the occurrence of any event giving rise to the operation of Sections 2.9 or
4.10 with respect to such Lender, it will, if requested by the Borrower, use
reasonable efforts (subject to overall policy considerations of such Lender) to
designate another lending office for any Revolving Loans or Letters of Credit
affected by such event, provided that such designation is made on such terms
that such Lender and its lending office suffer no economic, legal or
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regulatory disadvantage, with the object of avoiding the consequence of the
event giving rise to the operation of such Sections. Nothing in this Section
4.12 shall affect or postpone any of the obligations of the Borrower or the
right of any Lender provided in Sections 2.9 or 4.10.
ARTICLE 5.
Conditions Precedent
5.1 Conditions to Initial Loans and Letters of Credit. The
obligation of each Lender to make Revolving Loans hereunder and the obligation
of any Issuing Bank to issue Letters of Credit, in each case constituting the
Initial Credit Event, is subject to the satisfaction of, or waiver of,
immediately prior to or concurrently with the making of such Revolving Loans or
the issuance of such Letters of Credit on the Closing Date, the following
conditions precedent:
(a) Execution of Agreement; Notes. On or prior to the Closing
Date, this Credit Agreement shall have become effective as provided in
Section 11.14 and there shall have been delivered to the Payments
Administrator for the account of each Lender the appropriate Revolving
Note in the amount, maturity and as otherwise provided herein.
(b) Officer's Certificate. On the Closing Date, the Agent shall
have received a certificate from each of the Borrower, Canadian Holdco
and U.S. Holdco dated such date signed by an appropriate officer of the
Borrower, Canadian Holdco or U.S. Holdco, as the case may be stating
that all of the applicable conditions set forth in Sections 5.1(i), (j),
(k), (l), (m), (n) and (o) and 5.2(a), (b), (c) and (d) exist as of such
date.
(c) Opinions of Counsel. On the Closing Date, the Agent shall
have received opinions, addressed to the Agent, the Collateral Agent and
each of the Lenders and dated the Closing Date, (i) from Xxxxxx Xxxxxxx
Xxxxxx & Xxxxxxx and Xxxxx Day Xxxxxx & Xxxxx, special counsels to the
Borrower, which opinions shall cover the matters contained in Exhibit
E-1 and such other matters incident to the transactions contemplated
herein as the Agent may reasonably request, (ii) from Fraser & Xxxxxx,
special counsel to Consumers which opinion shall cover the matters
contained in Exhibit E-2 and such other matters incident to the
transactions contemplated herein as the Agent may reasonably request,
(iii) from White & Case, special counsel to the Lender, which opinion
shall cover the matters contained in Exhibit E-3 and (iv) from local
counsel reasonably satisfactory to the Agent, opinions each of which
shall be in form and substance reasonably satisfactory to the
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Agent and shall cover the perfection of the security interest granted
pursuant to the Security Agreement and such other matters incident to
the transaction contemplated herein as the Agent may reasonably request.
(d) Security Agreement. On the Closing Date, the Borrower shall
have duly authorized, executed and delivered a Security Agreement in the
form of Exhibit F (as modified, amended or supplemented from time to
time in accordance with the terms thereof and hereof, the "Security
Agreement") together with:
(A) executed copies of Financing Statements (Form UCC-1)
in appropriate form for filing under the UCC of each jurisdiction
as may be necessary to perfect the security interests purported
to be created by the Security Agreement;
(B) certified copies of Requests for Information or Copies
(Form UCC-11), or equivalent reports, each of recent date listing
all effective financing statements that name the Borrower as
debtor and that are filed in the jurisdictions referred to in
clause (A), together with copies of such financing statements
(none of which shall cover the Collateral except those with
respect to which appropriate termination statements executed by
the secured lender thereunder have been delivered to the Agent);
(C) evidence of the completion of all other filings of, or
with respect to, the Security Agreement as may be necessary or,
in the opinion of the Collateral Agent, desirable to perfect the
security interests intended to be created by the Security
Agreement; and
(D) evidence that all other actions necessary or, in the
reasonable opinion of the Collateral Agent, desirable to perfect
and protect the security interests purported to be created by the
Security Agreement have been taken.
(e) Collateral Access Agreements. On the Closing Date, the Agent
shall have received Collateral Access Agreements substantially in the
form of Exhibit G (as modified, amended, or supplemented from time to
time in accordance with the terms hereof and thereof, the "Collateral
Access Agreements" with respect to Inventory locations as may be
requested by the Agent or PNC, which Collateral Access Agreements shall
be in full force and effect.
(f) Collection Bank Agreements; Concentration Account Agreement.
On the Closing Date, the Agent shall have received fully executed copies
of the
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Collection Bank Agreements and the Concentration Account Agreement, each
of which shall be in Full Force and effect.
(g) Intercreditor Agreement. On the Closing Date, the Agent on
behalf of the Lenders, BTCo on behalf of the holders of Bridge Senior
Notes and the Borrower shall have entered into an Intercreditor
Agreement in the form of Exhibit H (as modified, amended or supplemented
from time to time in accordance with the terms thereof and hereof, the
"Intercreditor Agreement"), which shall be in full force and effect.
(h) Borrowing Base Certificate. On the Closing Date, the Borrower
shall have delivered to the Agent a Borrowing Base Certificate meeting
the requirements of Section 7.1(e) and which Borrowing Base shall
indicate (in a manner satisfactory to the Agent) that on such date and
after giving effect to the consummation of the Transaction, the Borrower
shall be able to incur additional Outstandings, after giving effect to
the Outstandings on the Closing Date, of $50,000,000 or more in
compliance with the Borrowing Base and Inventory Sublimits restrictions.
(i) Equity Issuances. The Borrower shall have (x) issued at least
$3.4 million of Common Stock to the Equity Investors (the "Common Stock
Financing") and (y) issued $140 million of Preferred Stock to the Equity
Investors, the "Preferred Stock Financing" together with the Common
Stock Financing, the "Equity Financing"), in each case, pursuant to
documentation (including without limitation the TD Loan Agreement) in
form and substance satisfactory to the Agent and the Required Lenders;
provided that the Borrower shall have received at least $85 million of
net cash proceeds from the Equity Financing, which shall be provided by
Consumers or its Affiliates. All terms and conditions of the Preferred
Stock issued in connection with the Preferred Financing and of the
Common Stock issued pursuant to the Common Stock Financing shall be
reasonably satisfactory to the Agent and the Required Lenders. The
Borrower shall have used all net cash proceeds received from the Equity
Financing to make payments owing in connection with the Transaction
prior to or concurrently with the utilization of the Revolving Loans for
such purpose.
(j) Issuance of Bridge Senior Notes. The Borrower shall have
received gross cash proceeds of $130 million from the issuance of a like
principal amount of Bridge Senior Notes. All terms and conditions of the
Bridge Senior Notes shall be reasonably satisfactory to the Agent and
PNC. The Borrower shall have used all net cash proceeds received from
the issuance of the Bridge Senior Notes to make payments owing in
connection with the Transaction prior to or concurrently with the
utilization of Revolving Loans for such purpose.
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(k) Acquisition Agreement; Indemnity Agreement; Plant Sales; etc.
(A) All terms of, and the documentation for the Acquisition and the
Plant Sales (including the Acquisition Agreement, the Indemnity
Agreement and all documentation relating thereto), shall be satisfactory
to the Agent and the Required Lenders. All conditions precedent to the
consummation of the Acquisition and the Plant Sales as set forth in the
documentation relating thereto (including all conditions precedent in
the Acquisition Agreement and the Indemnity Agreement) shall have been
satisfied, and not waived except with the consent (which will not be
unreasonably withheld) of the Agent and the Required Lenders, to the
reasonable satisfaction of the Agent and PNC. The Transaction shall have
been consummated in accordance with the documentation therefor, the
Orders, the Projections and all applicable laws.
(B) On the Closing Date, O-I shall have performed its
obligations under the Acquisition Agreement and consummated the
Plant Sales in accordance with the terms thereof. O-I and the
Borrower (as successor in interest to Consumers) shall be party
to that certain Technical Assistance and License Agreement,
relating to certain licensing matters, which shall be in full
force and effect.
(C) The Agent and Required Lenders shall be reasonably
satisfied through the execution and delivery of a Plan
Termination Agreement, dated as of the Closing Date and in form
and substance satisfactory to the Agent (the "Plan Termination
Agreement") that the PBGC is satisfied with the Borrower's
intention to pay certain pension obligations of Old Anchor Glass
which are part of the Acquired Business with $9.0 million of
Preferred Stock and $9.1 million of cash on the Closing Date, and
that no event or condition has occurred which may give rise to
liability under Title IV of ERISA, other than premiums under
Section 4006 of ERISA.
(D) The Agent shall have received reports, consents and
other information in form and substance reasonably satisfactory
to the Agent concerning the supply agreement with the Bacardi
Company.
(E) The order (the "Sale Order") which was entered by the
Bankruptcy Court on December 20, 1996 authorizing (x) Old Anchor
Glass to perform its obligations under the Acquisition Agreement
and related documents and (y) the transfer of the assets
contemplated thereunder to the Borrower free and clear of liens,
claims, and interests, shall (i) have been delivered to the Agent
and the Lenders, and (ii) not have been appealed or if appeal
shall have been taken therefrom, no stay pending appeal shall
have been issued and the Sale Order shall be in full force and
effect.
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(l) Existing Credit Agreement, etc. (i) On the Closing Date and
concurrently with the Initial Credit Event, the creditors under the
Existing Credit Agreement and the Existing Senior Secured Notes shall
have terminated and released all security interests in and Liens on the
assets owned by Old Anchor Glass and its respective Subsidiaries, and
the Agent shall have received all such releases as may have been
requested by the Agent, which releases shall be in form and substance
reasonably satisfactory to the Agent.
(ii) On the Closing Date and after giving effect to the
Transaction and the Revolving Loans incurred on the Closing Date,
neither the Borrower nor any of its Subsidiaries shall have any
preferred stock or Indebtedness outstanding except for (i) the
Revolving Loans, (ii) the Bridge Senior Notes, (iii) the Existing
Indebtedness and (iv) the Preferred Stock. On and as of the
Closing Date, all of the Existing Indebtedness shall remain
outstanding after giving effect to the Transaction and the other
transactions contemplated hereby without any default or events of
default existing there- under or arising as a result of the
Transaction and the other transactions contemplated hereby
(except to the extent amended or waived by the parties thereto on
terms and conditions satisfactory to the Agent and PNC), and
there shall not be any amendments or modifications to the
Existing Indebtedness Agreements other than as requested or
approved by the Agent or PNC. On and as of the Closing Date, the
Agent and PNC shall be satisfied with the amount of and the terms
and conditions of all Existing Indebtedness.
(m) Approvals. All necessary governmental (domestic and foreign)
and material third party approvals and/or consents (including the
Orders) in connection with the Transaction, the transactions
contemplated by the Transaction Documents and otherwise referred to
herein or therein shall have been obtained and remain in full force and
effect, and all applicable waiting periods shall have expired without
any action being taken by any competent authority which restrains,
prevents, or imposes materially adverse conditions upon, the
consummation of the Transaction, the making of any Revolving Loans or
the issuance of any Letters of Credit or the other transactions
contemplated hereby. There shall not have been any statute, rule
regulation, injunction or order applicable to the Transaction, or the
financing thereof, promulgated, enacted, entered or enforced by any
state or federal government or governmental or regulatory authority or
agency or by any federal or state court or tribunal, nor shall there be
pending any action or proceeding by or before any such authority, court
or tribunal, involving a substantial likelihood of an order, that would
prohibit, restrict, delay or otherwise materially adversely affect the
Transaction or the financing thereof.
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(n) Material Adverse Change, etc. Since December 2, 1996, nothing
shall have occurred (and neither the Agent nor the Lenders shall have
become aware of any facts or conditions not previously known) which the
Agent or PNC shall determine could be reasonably likely to have a
Material Adverse Effect.
(o) Litigation. On the Closing Date, there shall be no actions,
suits, investigations or proceedings pending or threatened (a) with
respect to this Credit Agreement or any other Credit Document or (b)
which the Agent or PNC shall determine is reasonably likely to have a
Material Adverse Effect.
(p) Corporate Proceedings. (i) On the Closing Date, the Agent
shall have received from each of the Borrower, Canadian Holdco and U.S.
Holdco a certificate, dated the Closing Date, signed by the secretary or
any assistant secretary of the Borrower, Canadian Holdco or U.S. Holdco,
as the case may be, in the form of Exhibit I with appropriate
insertions, together with copies of the Certificate of Incorporation and
By-Laws, or other organizational documents of the Borrower, Canadian
Holdco or U.S. Holdco, as the case may be, and the resolutions of the
Borrower, Canadian Holdco or U.S. Holdco, as the case may be, referred
to in such certificate and all of the foregoing (including each such
Certificate of Incorporation and By-Laws) shall be reasonably
satisfactory to the Agent.
(ii) On the Closing Date, all corporate and legal
proceedings and all instruments and agreements in connection with
the transactions contemplated by this Credit Agreement and the
other Transaction Documents shall be reasonably satisfactory in
form and substance to the Agent, and the Agent shall have
received all information and copies of all certificates,
documents and papers, including good standing certificates and
any other records of corporate proceedings and governmental
approvals, if any, which the Agent reasonably may have requested
in connection therewith, such documents and papers, where
appropriate, to be certified by proper corporate or governmental
authorities.
(q) Plans; Collective Bargaining Agreements; Existing
Indebtedness Agreements; Shareholders' Agreements; Management
Agreements; Employment Agreements; Tax Sharing Agreements; Affiliate
Transaction Agreement. On or prior to the Closing Date, there shall have
been delivered to the Agent copies, certified as true and correct by an
appropriate officer of the Borrower making such delivery, of:
(i) all Plans (and for each Plan that is required to file
an annual report on Internal Revenue Service Form 5500-series, a
copy of the most recent such report (including, to the extent
required, the related financial
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and actuarial statements and opinions and other supporting
statements, certifications, schedules and information), and for
each Plan that is a "single- employer plan," as defined in
Section 4001(a)(15) of ERISA, the most recently prepared
actuarial valuation therefor) and any other "employee benefit
plans," as defined in Section 3(3) of ERISA, and any other
material agreements, plans or arrangements, with or for the
benefit of current or former employees of the Company or any of
its Subsidiaries or any ERISA Affiliate (provided that the
foregoing shall apply in the case of any "multi-employer plan,"
as defined in 4001(a)(3) of ERISA, only to the extent that any
document described therein is in the possession of the Company or
any Subsidiary of the Company or any ERISA Affiliate or
reasonably available thereto from the sponsor or trustee of any
such plan), and any recent actuarial analysis prepared in
connection with any of the foregoing;
(ii) to the extent requested by the Agent prior to the
date of this Credit Agreement, any collective bargaining
agreements or any other similar agreement or arrangements
covering the employees of the Borrower (collectively, the
"Collective Bargaining Agreements");
(iii) all agreements evidencing or relating to the
Existing Indebtedness (collectively, the "Existing Indebtedness
Agreements");
(iv) all agreements entered into by Borrower or any
Subsidiary of Borrower (x) governing the terms and relative
rights of its capital stock or (y) with any shareholders relating
to such entity with respect to their capital stock (collectively,
the "Shareholders' Agreements");
(v) any material agreements (or the forms thereof) with
members of, or with respect to the, management of Borrower or any
Subsidiary of Borrower (collectively the "Management
Agreements");
(vi) any employment agreements (or the forms thereof
together with a list of employees who are parties to such
agreements) entered into by Borrower or any Subsidiary of
Borrower (collectively, the "Employment Agreements");
(vii) any tax sharing, tax allocation and other similar
agreement entered into by Borrower or any Subsidiary of Borrower
(collectively, the "Tax Sharing Agreements"); and
(viii) the Affiliate Transaction Agreement;
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all of which documents relating to the Plans, Collective Bargaining
Agreements, Existing Indebtedness Agreements, Shareholders' Agreements,
Management Agreements, Employment Agreements, Tax Sharing Agreements and
the Affiliate Transaction Agreement shall be in the form delivered to
counsel to the Agent on or prior to the date hereof or otherwise in form
and substance reasonably satisfactory to the Agent and PNC and shall be
in full force and effect on the Closing Date.
(r) Solvency Opinion. On the Closing Date, the Lenders shall have
received an opinion from American Appraisal Associates, Inc. in each
case, in form and substance reasonably satisfactory to the Agent stating
the conclusions that, after giving effect to the Transaction and the
incurrence of all the financing contemplated thereby, the Borrower is
not insolvent and will not be rendered insolvent by the indebtedness
incurred in connection therewith, and will not be left with unreasonably
small capital with which to engage in its business and it will not have
incurred debts beyond its ability to pay such debts as they mature.
(s) Projections; Plant Closures, etc. On the Closing Date, the
Lenders shall have received detailed annual five-year financial
projections (monthly for the first year, quarterly for the second year
and annually thereafter) (including details as to volume, price and cost
assumptions and corresponding balance sheets, statements of operations
and cash flow and changes in shareholders' equity), and one year
financial projections describing on a monthly basis plant-by-plant and
customer-by- customer grossage and sales of the Borrower after giving
effect to the Transaction in form and substance reasonably satisfactory
to the Agent and PNC and the Agent and PNC shall be reasonably satisfied
with the accounting practices and procedures to be utilized by the
Borrower following the Transaction (together with those projections
heretofore provided to the Lenders, the "Projections").
(t) Insurance Policies. On the Closing Date, the Agent shall have
received evidence (including, without limitation, certificates of
insurance; showing compliance with the requirements of Section 7.10 for
the business and properties of the Borrower and its Subsidiaries), in
form and substance reasonably satisfactory to the Agent.
(u) Consent Letter. On the Closing Date, the Agent shall have
received a letter from CT Corporation System, substantially in the form
of Exhibit J hereto, indicating its consent to its appointment by the
Borrower, Canadian Holdco and U.S. Holdco as its agent to receive
service of process as specified in Section 11.1 of this Credit
Agreement.
(v) Payment of Fees. On the Closing Date, all costs, fees and
expenses, and all other compensation contemplated by this Credit
Agreement or the PNC
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Expense Letter, due to the Agent, PNC or the Lenders (including, without
limitation, legal fees and expenses) that have been invoiced in
accordance with Section 4.5(a) hereof shall have been paid to the extent
due.
(w) Collateral Examination. On the Closing Date, the Lenders
shall have received a final pre-closing collateral examination report
concerning all accounts receivables and inventory of the Acquired
Business, the form and substance of which are not materially different
from the collateral examination report heretofore received by the
Lenders, all in form and substance reasonably satisfactory to the Agent
and PNC.
(x) Environmental Reports. On or prior to the Closing Date, the
Lenders shall have received final environmental reports from Environ
International Corporation, together with the Phase I report contemplated
therein, the results of which are reasonably satisfactory to the Agent
and PNC.
(y) Management. On the Closing Date, the identity of the initial
Board of Directors of the Borrower and the management of the Borrower
shall have been disclosed to the Lenders and they shall be satisfied
therewith.
(z) U.S. Holdco Guaranty. On the Closing Date, U.S. Holdco shall
have duly authorized, executed and delivered the U.S. Holdco Guaranty in
the form of Exhibit O (as modified, amended or supplemented from time to
time in accordance with the terms thereof and hereof, the "U.S. Holdco
Guaranty").
(aa) O-I Assurance Agreement. On the Closing Date, the Borrower
shall have duly authorized, executed and delivered a O-I Assurance
Agreement in the form of Exhibit P (as modified, amended or supplemented
from time to time in accordance with the terms thereof and hereof, the
"O-I Assurance Agreement").
(bb) Capital Call Agreement. On the Closing Date, (i) Consumers
shall have duly authorized, executed and delivered the Capital Call
Agreement in the form of Exhibit R (as modified, amended or supplemented
from time to time in accordance with the terms thereof and hereof, the
"Capital Call Agreement") and (ii) the Agent shall have received an
acknowledgment and agreement from Toronto-Dominion in form and substance
satisfactory to the Agent with respect to the Capital Call Agreement.
(cc) Assignment and Assumption Agreement. On the Closing Date,
Consumers shall have duly authorized, executed and delivered the
Assignment and Assumption dated the Closing Date between the Borrower
and Consumers.
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(dd) Pledge Agreement. On the Closing Date, U.S. Holdco shall
have duly authorized, executed and delivered a Pledge Agreement in the
form of Exhibit S (as modified, amended or supplemented from time to
time, the "Pledge Agreement") and shall have delivered all pledged
securities purported to be pledged thereunder to BTCo, as pledgee
thereunder for the benefit of the secured creditors described therein.
(ee) Closing Expenses. The Agent shall be satisfied, based on a
schedule provided to it on the Closing Date, that the total expenses for
the Transaction shall not exceed $21,000,000, and Consumers shall pay at
least $6,000,000 of such expenses.
5.2 Conditions to Each Revolving Loan and Letter of Credit. On
the date of the making of any Revolving Loan or the issuance of any Letter of
Credit, both immediately before and after giving effect thereto and to the
application of the proceeds therefrom, the following statements shall be true to
the satisfaction of the Agent (and each delivery or deemed delivery of each
Notice of Borrowing and a Letter of Credit Request, and the acceptance by the
Borrower of the proceeds of such Revolving Loans or issuance of such Letter of
Credit, shall constitute a representation and warranty by the Borrower that on
the date of such Revolving Loans or issuance of such Letter of Credit
immediately before and after giving effect thereto and to the application of the
proceeds therefrom, such statements are true):
(a) The representations and warranties contained in this Credit
Agreement and in each other Credit Document are true and correct in all
material respects on and as of the date of such Revolving Loans or
issuance of such Letter of Credit as though made on and as of such date,
except to the extent that such representations and warranties expressly
relate solely to an earlier date (in which case such representations and
warranties shall have been true and accurate on and as of such earlier
date);
(b) No event has occurred and is continuing, or would result from
such Revolving Loans or the issuance of any Letter of Credit or the
application of the proceeds thereof, which would constitute a Default or
an Event of Default;
(c) No change or development which in any such case has had or is
reasonably expected to have a Material Adverse Effect, shall have
occurred and be continuing; and
(d) With respect to the issuance of any Letter of Credit, none of
the events set forth in Section 3.1 hereof has occurred and is
continuing or would result from the issuance of such Letter of Credit.
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The acceptance of the benefits of each Credit Event shall
constitute a representation and warranty by the Borrower to each of the Lenders
that all of the applicable conditions specified above exist as of the date of
such Credit Event. All of the certificates, legal opinions and other documents
and papers referred to in this Section 5, unless otherwise specified, shall be
delivered to the Agent at its address specified in Section 11.5 hereof for the
account of each of the Lenders and, except for the Revolving Notes, in
sufficient counterparts or copies for each of the Lenders and shall be in form
and substance as specified herein or otherwise satisfactory to the Agent.
ARTICLE 6.
Representations and Warranties
To induce the Lenders to enter into this Credit Agreement and to
make Revolving Loans and issue and/or participate in the Letters of Credit
provided for herein, the Borrower makes the following representations,
warranties and agreements, as to itself and as to each of its Subsidiaries, all
of which shall survive the execution and delivery of this Credit Agreement, the
making of the Revolving Loans and the issuance of the Letters of Credit (with
the occurrence of each Credit Event being deemed to constitute a representation
and warranty that the matters specified in this Article 6 are true and correct
in all material respects on and as of the date of each such Credit Event, unless
stated to relate to a specific earlier date, in which case they will be true and
correct as of such earlier date):
6.1 Corporate Status. The Borrower (i) is a duly organized and
validly existing corporation in good standing under the laws of the jurisdiction
of its organization and has the corporate power and authority to own its
property and assets and to transact the business in which it is engaged and
presently proposes to engage and (ii) has duly qualified and is authorized to do
business and is in good standing in all jurisdictions where it is required to be
so qualified and where the failure to be so qualified would be reasonably likely
to have a Material Adverse Effect.
6.2 Corporate Power and Authority. The Borrower has the corporate
power and authority to execute, deliver and carry out the terms and provisions
of the Credit Documents to which it is a party and has taken all necessary
corporate action to authorize the execution, delivery and performance of the
Credit Documents to which it is a party. The Borrower has duly executed and
delivered each Credit Document to which it is a party and each such Credit
Document constitutes the legal, valid and binding obligation of the Borrower
enforceable in accordance with its terms, except that such enforceability may be
limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium and
similar laws of general application relating to or affecting the rights and
remedies of creditors and
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(ii) federal securities or other laws or regulations or public policy insofar as
they may restrict the enforceability of rights to indemnification.
6.3 No Violation. Neither the execution, delivery and performance
by the Borrower of the Credit Documents to which it is a party nor compliance
with the terms and provisions thereof, nor the consummation of the transactions
contemplated therein (i) will contravene any applicable provision of any law,
statute, rule, regulation, order, writ, injunction or decree of any court or
governmental instrumentality, (ii) will conflict with or violate or result in
any breach of any of the terms, covenants, conditions or provisions of, or
constitute a default under, or (other than pursuant to the Collateral Documents)
result in the creation or imposition of (or the obligation to create or impose)
any Lien upon any of the property or assets of the Borrower or any of its
Subsidiaries pursuant to the terms of any indenture, mortgage, deed of trust,
agreement or other instrument to which the Borrower or any of its Subsidiaries
is a party or by which it or any of its property or assets are bound or to which
it may be subject or (iii) will violate any provision of any Governing Document
of the Borrower or any of the Borrower's Subsidiaries, except, in the case of
clauses (i) and (ii) any immaterial contravention, conflict, inconsistency,
breach or default which are not reasonably likely to adversely affect any Lender
or to have a Material Adverse Effect.
6.4 Litigation. There are no actions, suits or proceedings
pending or threatened with respect to (i) any Credit Document or (ii) the
Borrower or any of the Borrower's Subsidiaries that, after giving effect to
expected insurance proceeds and indemnity payments, are reasonably likely to
have a Material Adverse Effect.
6.5 Use of Proceeds. (a) The proceeds of all Revolving Loans
shall be utilized to (i) effect the Transaction, (ii) to pay certain fees and
expenses relating thereto and (iii) for general corporate and working capital
purposes of the Borrower and its Subsidiaries; provided that proceeds of
Revolving Loans incurred on the Closing Date shall not exceed the lesser of (x)
$45 million and (y) the Borrowing Base on the Closing Date minus $50 million.
(b) No part of the proceeds of any Revolving Loan will be used to
purchase or carry any Margin Stock or to extend credit for the purpose of
purchasing or carrying any Margin Stock. Neither the making of any Revolving
Loan nor the use of the proceeds thereof nor the occurrence of any other Credit
Event will violate or be inconsistent with the provisions of Regulations G, T,
U, or X of the Board of Governors of the Federal Reserve System.
6.6 Governmental Approvals. Except for the filing of financing
statements and continuation statements as required under the Collateral
Documents, and the entry of the Orders, no order, consent, approval, license,
authorization, or validation of, or filing,
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recording or registration with, or exemption by, any foreign or domestic
governmental or public body or authority, or any subdivision thereof, is
required to authorize or is required in connection with (i) the execution,
delivery and performance by the Borrower of any Credit Document or (ii) the
legality, validity, binding effect or enforceability of any Credit Document as
against the Borrower.
6.7 Investment Company Act. Neither the Borrower nor any of the
Borrower's Subsidiaries is an "investment company" or a company "controlled" by
an "investment company", within the meaning of the Investment Company Act of
1940, as amended.
6.8 Public Utility Holding Company Act. Neither the Borrower nor
any of the Borrower's Subsidiaries is a "holding company," or a "subsidiary
company" of a "holding company," or an "affiliate" of a "holding company" or of
a "subsidiary company" of a "holding company," within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
6.9 True and Complete Disclosure. (a) All factual information
(taken as a whole) heretofore or contemporaneously furnished by or on behalf of
the Borrower in writing to the Agent or any Lender does not, and all other such
factual information (taken as a whole) hereafter furnished by or on behalf of
the Borrower in writing to the Agent or any Lender will not, as of the date as
of which such information is dated or certified, contain any untrue statement of
a material fact or omit to state any material fact necessary to make such
information (taken as a whole) not misleading as of such time, in each case in
light of the circumstances under which such information was provided, it being
understood and agreed that for the purposes of this Section 6.9, such factual
information shall not include the Projections and pro forma financial
information.
(b) The Projections and pro forma financial information contained
in the factual information referred to in clause (a) above are based on good
faith estimates and assumptions believed by the Borrower to be reasonable at the
time made, it being recognized by the Lenders that such projections as to future
events are not to be viewed as facts and necessarily were based upon numerous
assumptions with respect to industry performance, general business and economic
and competitive conditions and uncertainties, taxes and other matters which are
beyond the control of the Borrower and the Borrower's Subsidiaries, such that
there can be no assurance that such projections will be realized and actual
results may differ materially from the projected results.
6.10 Financial Condition; Financial Statements. (a) On and as of
the Closing Date on a pro forma basis after giving effect to the Transaction and
all Indebtedness incurred, and to be incurred, and Liens created and to be
created, by the Borrower in connection with this Credit Agreement and the Bridge
Senior Notes, (x) the
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sum of the assets, at a fair valuation, of the Borrower will exceed its debts,
(y) the Borrower will not have incurred nor intend to, or believe that it will,
incur debts beyond its ability to pay such debts as such debts mature and (z)
the Borrower does not have unreasonably small capital with which to conduct its
businesses. For purposes of this Section 6.10(a), "debt" means any reasonably
expected liability on a claim, and "claim" means (i) 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 (ii) right to an equitable remedy for breach of performance if
such breach gives rise to a payment, whether or not such right to an equitable
remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed,
undisputed, secured or unsecured.
(b) The Borrower has furnished to the Lenders the following
financial statements, which have been prepared in accordance with GAAP (except
for the valuation of goodwill and, in the case of the unaudited financial
statements referred to below, for the omission of footnotes and ordinary year
end adjustments) consistently applied throughout the periods involved: (i) Old
Anchor's consolidated balance sheet as of, and statements of operations,
shareholder's equity and cash flows for the fiscal year ended, December 31,
1995, audited by independent certified public accountants, and accompanied by an
unqualified opinion thereof and (ii) an unaudited consolidated balance sheet of
Old Anchor as of, and unaudited statements of operations, shareholder's equity
and cash flows for (x) the nine-month period ending September 30, 1996 and (y)
the months of October and November 1996. Since September 30, 1996 nothing has
occurred which would be reasonably likely to result in a Material Adverse
Effect.
(c) The pro forma balance sheet of Old Anchor as of December 31,
1995 and September 30, 1996 and the related statement of operations of Old
Anchor for the year ended December 31, 1995 and the 9-month period ended
September 30, 1996, a copy of which has heretofore been furnished to the Agent,
fairly present the pro forma financial condition of Old Anchor assuming that the
Transactions had occurred as of January 1, 1995. The pro forma adjustments made
in such pro forma financial statements have been properly applied to the
historical amounts in the compilation thereof; the assumptions used in preparing
such pro forma financial statements provide a reasonable basis for presenting
the significant direct effects of the Transactions and such pro forma
adjustments give appropriate effect to those assumptions.
6.11 Locations of Offices, Records and Inventory. The address of
the principal place of business and chief executive office of the Borrower as of
the date hereof and as of the Closing Date is set forth on Schedule II. The
books and records of the Borrower, and all its chattel paper and records of
Accounts, are maintained exclusively at the locations listed on Schedule II. As
of the Closing Date, there is no jurisdiction in which the Borrower has any
chattel paper, records of Account and Inventory (except for Inventory
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in transit) other than those jurisdictions identified on Schedule II. Schedule
II also contains a complete list of the legal names and addresses of each
facility or warehouse at which Inventory is stored as of the date hereof and as
of the Closing Date. None of the receipts received by the Borrower from any
warehouseman states that the goods covered thereby are to be delivered to bearer
or to the order of a named person other than the Borrower or to a named person
and such named person's assigns.
6.12 Fictitious Business Names. Except as set forth in Schedule
III, the Borrower has not used any corporate or fictitious name since January 3,
1997, other than the corporate name shown on its Governing Documents.
6.13 Security Interests. On and after the Closing Date, each of
the Collateral Documents create, as security for the Obligations, a valid and
enforceable perfected security interest in and Lien on all of the Collateral,
superior to and prior to the rights of all third persons and subject to no other
Liens, other than as otherwise permitted under the Collateral Documents. At all
times on or after the Closing Date, the respective grantor under each Collateral
Document shall have good and marketable title to all the Collateral subject
thereto free and clear of all Liens other than Liens permitted under Section
8.2. No filings or recordings are required in order to perfect the security
interests created under any Collateral Document except for filings or recordings
required pursuant to the terms of any such Collateral Document.
6.14 Tax Returns and Payments. The Borrower and each of the
Borrower's Subsidiaries has timely filed or caused to be timely filed with the
appropriate taxing authority, all federal returns and all other material
returns, statements, forms and reports for taxes required to be filed by or with
respect to the income, properties or operations of the Borrower and/or any of
the Borrower's Subsidiaries. Such returns accurately reflect all liability for
taxes of the Borrower and the Borrower's Subsidiaries for the periods covered
thereby. The Borrower and each of the Borrower's Subsidiaries has paid all
material taxes payable by it other than taxes which are not established, and
other than those contested in good faith and for which adequate reserves have
been established in accordance with generally accepted accounting principles.
There is no material action, suit, proceeding, investigation, audit, or claim
now pending or, to the knowledge of the Borrower, threatened by any authority
regarding any taxes relating to the Borrower or any of the Borrower's
Subsidiaries. As of the Closing Date, neither the Borrower nor any of the
Borrower's Subsidiaries has entered into an agreement or waiver or been
requested to enter into an agreement or waiver extending any statute of
limitations relating to the payment or collection of taxes of the Borrower or
any of the Borrower's Subsidiaries, or is aware of any circumstances that would
cause the taxable years or other taxable periods of the Borrower or any of the
Borrower's Subsidiaries not to be subject to the normally applicable statute of
limitations. None of the Borrower or any of the Borrower's Subsidiaries have
provided, with respect to themselves or property held by them, any
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consent under Section 341 of the Code. Neither the Borrower nor any of the
Borrower's Subsidiaries has incurred, or will incur, any material tax liability
with respect to the Transaction and the other transactions contemplated hereby.
6.15 Compliance with ERISA. (i) Schedule IV identifies each Plan.
Except as set forth on Schedule IV; (A) each Plan (and each related trust,
insurance contract or fund) is in substantial compliance with its terms and with
all applicable laws, including, without limitation, ERISA and the Code; (B) each
Plan (and each related trust, if any) which is intended to be qualified under
Section 401(a) of the Code has received a determination letter from the Internal
Revenue Service to the effect that it meets the requirements of Sections 401(a)
and 501(a) of the Code; (C) no Reportable Event has occurred; (D) no Plan which
is a multiemployer plan (as defined in Section 4001(a)(3) of ERISA) is insolvent
or in reorganization; (E) no Plan has an Unfunded Current Liability which, when
added to the aggregate amount of Unfunded Current Liabilities with respect to
all other Plans, exceeds (1) in the case of all Plans of the Borrower and its
Subsidiaries $77,000,000, before giving effect to contributions contemplated by
Section 5.1(k)(C) and (2) in the case of ERISA Affiliates other than the
Borrower and its Subsidiaries $4,700,000; (F) no Plan which is subject to
Section 412 of the Code or Section 302 of ERISA has an accumulated funding
deficiency, within the meaning of such sections of the Code or ERISA, or has
applied for or received a waiver of an accumulated funding deficiency or an
extension of any amortization period, within the meaning of Section 412 of the
Code or Section 303 or 304 of ERISA; (G) all contributions required to be made
with respect to a Plan have been timely made; (H) neither the Borrower nor any
Subsidiary of the Borrower nor any ERISA Affiliate has incurred any material
liability (including any indirect, contingent or secondary liability) to or on
account of a Plan pursuant to Section 409, 502(i), 502(l), 515, 4062, 4063,
4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971 or 4975 of
the Code or expects to incur any such liability under any of the foregoing
sections with respect to any Plan; (I) no condition exists which presents a
material risk to the Borrower or any Subsidiary of the Borrower or any ERISA
Affiliate of incurring a liability to or on account of a Plan pursuant to the
foregoing provisions of ERISA and the Code; (J) no proceedings have been
instituted to terminate or appoint a trustee to administer any Plan which is
subject to Title IV of ERISA; (K) no action, suit, proceeding, hearing, audit or
investigation with respect to the administration, operation or the investment of
assets of any Plan (other than routine claims for benefits) is pending, expected
or threatened; (L) using actuarial assumptions and computation methods
consistent with Part 1 of subtitle E of Title IV of ERISA, the aggregate
liabilities of the Borrower and its Subsidiaries and its ERISA Affiliates to all
Plans which are multiemployer plans (as defined in Section 4001(a)(3) of ERISA)
in the event of a complete withdrawal therefrom, as of the close of the most
recent fiscal year of each such Plan ended prior to the date of the most recent
Credit Event, would not exceed $360,000; (M) each group health plan (as defined
in Section 607(1) of ERISA or Section 4980B(g)(2) of the Code) which covers or
has covered employees or former employees of the Borrower, any Subsidiary of the
Borrower,
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or any ERISA Affiliate has at all times been operated in compliance with the
provisions of Part 6 of subtitle B of Title I of ERISA and Section 4980B of the
Code; (N) no lien imposed under the Code or ERISA on the assets of the Borrower
or any Subsidiary of the Borrower or any ERISA Affiliate exists or is likely to
arise on account of any Plan; and (O) the Borrower and its Subsidiaries do not
maintain or contribute to any employee welfare benefit plan (as defined in
Section 3(1) of ERISA) which provides benefits to retired employees or other
former employees (other than as required by Section 601 of ERISA) or any Plan
the obligations with respect to which could reasonably be expected to have a
material adverse effect on the ability of the Borrower to perform its
obligations under this Agreement.
6.16 Subsidiaries. As of the Closing Date, the Borrower has no
Subsidiaries.
6.17 Patents, etc. Except as otherwise described in the Security
Agreement, the Borrower and each of the Borrower's Subsidiaries have obtained
all material patents, trademarks, servicemarks, trade names, copyrights,
licenses and other rights, free from burdensome restrictions, that are necessary
for the operation of their respective businesses as presently conducted and as
proposed to be conducted.
6.18 Compliance with Statutes, etc. (a) The Borrower and each of
the Borrower's Subsidiaries is in compliance with all applicable statutes,
regulations and orders of, and all applicable restrictions imposed by, all
governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property, except such non- compliances as are
not likely to, in the aggregate, have a Material Adverse Effect.
(b) The Borrower and each of the Borrower's Subsidiaries is in
compliance with all applicable Environmental Laws governing its business for
which failure to comply is likely to have a Material Adverse Effect and neither
the Borrower nor any of the Borrower's Subsidiaries is liable for any material
penalties, fines or forfeitures for failure to comply with any of the foregoing
in the manner set forth above. All material licenses, permits, registrations or
approvals required for the business of the Borrower and each of the Borrower's
Subsidiaries, as conducted as of the Closing Date, under any Environmental Law
either (i) have been secured and the Borrower and each of the Borrower's
Subsidiaries is in material compliance therewith or (ii) appropriate filings
have been made to secure such licenses, permits, registrations and approvals and
the Borrower is not aware of any circumstance where (A) the same will not be
secured in due course or (B) the failure to secure the same prior to the Closing
Date will have a Material Adverse Effect. Neither the Borrower nor any of the
Borrower's Subsidiaries is in any respect in noncompliance with, breach of or
default under any applicable writ, order, judgment, injunction, or decree to
which the Borrower or such Subsidiary is a party and which would materially and
adversely affect the ability of the Borrower or such Subsidiary to operate its
business or other Real
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Property and no event has occurred and is continuing which, with the passage of
time or the giving of notice or both, would constitute noncompliance, breach of
or default thereunder. There are as of the Closing Date no Environmental Claims
pending or, to the best knowledge of the Borrower, threatened, which question
the validity, term or entitlement of the Borrower or any of the Borrower's
Subsidiaries for any permit, license, order or registration required for the
operation of any facility which the Borrower or any of the Borrower's
Subsidiaries currently operates and which could reasonably be expected to have a
Material Adverse Effect. There are no facts, circumstances, conditions or
occurrences in connection with the past or present operations of or business of
the Borrower or any of the Borrower's Subsidiaries on any Real Property of the
Borrower or any of the Borrower's Subsidiaries or on any property adjoining or
adjacent to any such Real Property, that (a) are reasonably expected (i) to form
the basis of an Environmental Claim against the Borrower any of the Borrower's
Subsidiaries or any Real Property of the Borrower or any of the Borrower's
Subsidiaries, or (ii) to cause such Real Property to be subject to any
restrictions on the ownership, occupancy, use or transferability of such Real
Property under any Environmental Law and (b) which could reasonably be expected
to have a Material Adverse Effect.
(c) Hazardous Materials have not at any time been (i) generated,
used, treated or stored on, or transported to or from, by the Borrower or any of
the Borrower's Subsidiaries, any Real Property of the Borrower or any of the
Borrower's Subsidiaries, except Hazardous Materials generated, used, treated or
stored on, or transported to or from, any Real Property of the Borrower or any
of the Borrower's Subsidiaries in the ordinary course of business and either (A)
in compliance with Environmental Laws or (B) if not in compliance, where such
non-compliance would not reasonably be expected to have a Material Adverse
Effect ("Permitted Materials") or (ii) released or disposed of (not including
the sale of inventory) on any such Real Property other than where such release
or disposals would not reasonably be expected to have a Material Adverse Effect.
(d) Schedule V sets forth all instances known to the Borrower of:
(i) noncompliance by the Borrower and each of its Subsidiaries with applicable
Environmental Laws; (ii) pending or threatened Environmental Claims which
question the validity, term or entitlement of the Borrower or any of its
Subsidiaries of or to any permit, license, order or registration required for
the operation of any facility which the Borrower or any of its Subsidiaries
currently operates; (iii) facts, circumstances, conditions or occurrences on any
Real Property of the Borrower or any of its Subsidiaries that are reasonably
expected to form the basis of an Environmental Claim against the Borrower or any
of its Subsidiaries or any Real Property of the Borrower or any of its
Subsidiaries, or to cause any Real Property of the Borrower or any of its
Subsidiaries to be subject to any restrictions on the ownership, occupancy, use
or transferability of such Real Property under any Environmental Law; and (iv)
the generation, use, treatment or storage of Hazardous Materials on, or
transportation of Hazardous Materials to or from, the Real Property of the
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Borrower or any of its Subsidiaries other than in the ordinary course of
business in material compliance with Environmental Laws, and the release or
disposal of Hazardous Materials on any Real Property of the Borrower or any of
its Subsidiaries. Schedule V is provided for informational purposes only. None
of the facts, circumstances, conditions or occurrences set forth on Schedule V,
individually or on the aggregate could reasonably be expected to have a Material
Adverse Affect.
6.19 Properties. Borrower and each of Borrower's Subsidiaries has
good title to all material properties owned by it free and clear of all Liens,
other than as permitted by Section 8.2. Schedule VI contains a true and complete
list of each Real Property owned, if any, and each Real Property leased by the
Borrower on the Closing Date and the type of interest therein held by the
Borrower.
6.20 Labor Relations; Collective Bargaining Agreements. (a) Set
forth on Schedule VII hereto is a list (including dates of termination) of all
collective bargaining or similar agreements between or applicable to the
Borrower or any of its Subsidiaries and any union, labor organization or other
bargaining agent in respect of the employees of the Borrower and/or any of its
Subsidiaries on the Closing Date.
(b) Neither the Borrower nor any of its Subsidiaries is engaged
in any unfair labor practice that is likely to have a Material Adverse Effect.
There is (i) no significant unfair labor practice complaint pending against the
Borrower or any of the Borrower's Subsidiaries or, to the best knowledge of the
Borrower, threatened against any of them, before the National Labor Relations
Board, and no significant grievance or significant arbitration proceeding
arising out of or under any collective bargaining agreement is pending on the
Closing Date against the Borrower or any of the Borrower's Subsidiaries or, to
the best knowledge of the Borrower, threatened against any of them, (ii) no
significant strike, labor dispute, slowdown or stoppage is pending against the
Borrower or any of the Borrower's Subsidiaries or, to the best knowledge of the
Borrower, threatened against the Borrower or any of the Borrower's Subsidiaries,
except (with respect to any matter specified in clause (i) and (ii) above,
either individually or in the aggregate) such as is not reasonably likely to
have a Material Adverse Effect.
6.21 Restrictions on Subsidiaries. Except for restrictions
contained in the Credit Documents, the Senior Note Documents and in agreements
with respect to the Existing Indebtedness, as of the Closing Date there are no
contractual or consensual restrictions on the Borrower or any of its
Subsidiaries which prohibit or otherwise restrict (i) the transfer of cash or
other assets (x) between the Borrower and any of its Subsidiaries or (y) between
any Subsidiaries of the Borrower or (ii) the ability of the Borrower or any of
its Subsidiaries to grant security interests to the Lenders in the Collateral.
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6.22 Status of Accounts. Each Account is based on an actual and
bona fide sale and delivery of goods or rendition of services to customers, made
by the Borrower or, to the knowledge of the Borrower, Old Anchor in the ordinary
course of its business; the goods and inventory being sold and the Accounts
created are its exclusive property and are not and shall not be subject to any
Lien, consignment arrangement, encumbrance, security interest or financing
statement whatsoever other than the Liens created pursuant to the Collateral
Documents and Permitted Liens, and, except as otherwise reported or reserved
against on the Borrower's or its Subsidiaries books and records, the Borrower's
customers have accepted the goods or services, owe and are obligated to pay the
full amounts stated in the invoices according to their terms, without any
dispute, offset, defense, or counterclaim.
6.23 Material Contracts. (a) Schedule VIII sets forth a true and
complete list of each Material Contract.
(b) Neither the Borrower nor any of its Subsidiaries is in breach
of or in default under any Material Contract.
6.24 Existing Indebtedness and Operating Leases. Schedule IX sets
forth a true and complete list of all Existing Indebtedness and Operating Leases
of the Borrower and its Subsidiaries as of the Closing Date, in each case
showing the aggregate principal amount thereof and the name of the respective
borrower and any other entity which directly or indirectly guaranteed such debt.
6.25 Tax Sharing Agreements. As of the Closing Date, the Borrower
is not party to any Tax Sharing Agreements.
ARTICLE 7.
Affirmative Covenants
The Borrower hereby covenants and agrees that on the Closing Date
and thereafter, for so long as this Credit Agreement is in effect and until the
Total Commitments have terminated, no Letters of Credit or Revolving Notes are
outstanding and the Revolving Loans and Letter of Credit Obligations, together
with interest, Fees, Expenses and all other Obligations (other than any
indemnities described in Section 11.8 hereof which are not then due and payable)
incurred hereunder, are paid in full:
7.1 Financial Information. The Borrower shall furnish to the
Lenders the following information within the following time periods, it being
understood that
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comparisons to prior periods shall only be required where Financial Statements
for such prior period have been prepared:
(a) as soon as available and in any event within 95 days after
the end of each fiscal year of the Borrower (other than the Management
Letter referred to in clause (B) below), (i) audited Financial
Statements as of the close of the fiscal year and for the fiscal year,
together with a comparison to the Financial Statements for the prior
year, in each case accompanied by (A) a report thereon of the Auditors
thereof unqualified as to scope, which report shall state that such
consolidated financial statements fairly present the consolidated
financial position of the Borrower and its consolidated Subsidiaries as
at the date indicated and the results of their operations and cash flows
for the periods indicated in conformity with GAAP (except as otherwise
stated therein) and that the examination by such Auditors has been made
in accordance with generally accepted auditing standards, (B) such
Auditors' "Management Letter" to the Borrower as soon as available, (C)
a written statement signed by such Auditors stating that in the course
of the annual audit of the business of the Borrower, which audit was
conducted by such Auditors in accordance with generally accepted
auditing standards, such Auditors (x) have not obtained any knowledge of
the existence of any Default or Event of Default under any provision of
Sections 8.4, 8.9, 8.10, 8.11, 8.12, 8.13 and 8.14 of this Credit
Agreement, or, if such Auditors shall have obtained from such
examination any such knowledge, they shall disclose in such written
statement the existence of the Default or Event of Default and the
nature thereof and (y) have examined information necessary to verify
compliance with Section 8.7 and the Affiliate Transactions Agreement (as
relating to the Borrower and its Subsdiaires), and that the Borrower and
its Subsidiaries are in compliance with the terms thereof, or if not so
in compliance, the Auditor shall disclose in such written statement the
scope and nature of such noncompliance, it being understood that such
Auditors shall not be required hereunder to perform any special audit
procedures and shall have no liability, directly or indirectly, to
anyone for failure to obtain knowledge of any such Default or Event of
Default and (ii) a compliance certificate substantially in the form of
Exhibit K along with a schedule in form satisfactory to the Agent of the
calculations used in determining, as of the end of such fiscal year,
whether the Borrower was in compliance with the covenants set forth in
Articles 7 and 8 of this Credit Agreement for such year. To the extent
that the Borrower's annual report on Form 10-K contains any of the
foregoing items, the Lenders will accept the Borrower's report on Form
10-K in lieu of such items;
(b) as soon as available and in any event within 45 days after
the end of each fiscal quarter of the Borrower (except the last fiscal
quarter of any fiscal year) (i) Financial Statements as at the end of
such period and for the fiscal year to date, together with a comparison
to the Financial Statements for the same periods in the
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prior year, all in reasonable detail and duly certified (subject to the
addition of footnotes and audit and normal year-end adjustments) by the
chief executive officer or chief financial officer of the Borrower as
having been prepared substantially in accordance with GAAP and (ii) a
compliance certificate substantially in the form of Exhibit K along with
a schedule in form satisfactory to the Agent of the calculations used in
determining, as of the end of such fiscal quarter, whether the Borrower
was in compliance with the covenants set forth in Articles 7 and 8 of
this Credit Agreement for such quarter. To the extent that the
Borrower's quarterly report on Form 10-Q contains any of the foregoing
items, the Lenders will accept the Borrower's report on Form 10-Q in
lieu of such items;
(c) as soon as available and in any event within 35 days after
the end of each month (except the last month of any fiscal quarter, with
respect to which such reports shall be delivered within 45 days after
the end of the month (other than the last quarter of the fiscal year
with respect to which such reports shall be delivered within 95 days
after the end of the month)), a consolidated and consolidating balance
sheet for the Borrower as at the end of such month and for the fiscal
year to date and consolidated statements of operations and cash flows
for such month and for the fiscal year to date, together with a
comparison to the balance sheet, statement of operations and statement
of cash flows for the same periods in the prior year, all in reasonable
detail and duly certified (subject to the addition of footnotes and
audit and normal year-end adjustments) by the chief executive officer or
chief financial officer of the Borrower as having been prepared
substantially in accordance with GAAP;
(d) not later than 30 days before the end of each fiscal year
commencing with the fiscal year ending December 31, 1997, monthly
projections including customer-by-customer and plant-by-plant grossage
and sales and plant-by-plant Capital Expenditures (in substantially the
same form as the Projections) for the Borrower and its Subsidiaries for
the following fiscal year and annual projections for each subsequent
fiscal year through and including the fiscal year in which the
Expiration Date occurs;
(e) upon request by the Agent at any time if a Default or Event
of Default shall exist and in any event not later than 12:00 Noon New
York time on the third Business Day of each week (or more frequently if
requested by the Agent in the exercise of its Permitted Discretion), and
within five Business Days after the last Business Day of each month, a
Borrowing Base certificate (the "Borrowing Base Certificate") in
substantially the form of Exhibit L, duly completed, as of Friday of the
immediately preceding week and as of the last day of such month, as
applicable (or such other date as the Agent may specify in such
request), and certified by the Borrower's chief executive officer, chief
financial officer or
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treasurer and subject only to adjustment upon completion of the normal
year-end audit and confirmation based upon cycle counting verification.
In addition, each Borrowing Base Certificate shall have attached to it
such additional schedules and/or other information, including monthly
aging reports, as the Agent may reasonably request;
(f) promptly and in any event within five Business Days after
becoming aware of the occurrence of a Default or Event of Default, a
certificate of the chief executive officer or chief financial officer of
the Borrower specifying the nature thereof and the Borrower's proposed
response thereto, each in reasonable detail;
(g) within 35 days after the end of each month (except the last
month of any fiscal quarter, with respect to which such reports shall be
delivered within 45 days after the end of the month (other than the last
quarter of the fiscal year with respect to which such reports shall be
delivered within 95 days after the end of the month)), a comparison of
consolidated actual results of operations, cash flow and capital
expenditures for the Borrower and the Borrower's Subsidiaries for such
month and for the period from the beginning of the current fiscal year
through the end of such month (i) with amounts projected for such month
and for the period from the beginning of the current fiscal year through
the end of such month pursuant to Section 7.1(d) above and (ii) with
actual results of operations, cash flow and capital expenditures for the
Borrower and the Borrower's Subsidiaries for the same periods of the
prior fiscal year, in each case, together with management discussion and
analysis relating to such results;
(h) promptly upon the earlier of the mailing or filing thereof,
copies of all 00-Xx, 00-Xx, 0-Xx, proxy statements, annual reports,
quarterly reports, registration statements and any other filings or
other communications made by the Borrower to holders of its publicly
traded securities or the Securities Exchange Commission from time to
time pursuant to the Securities Exchange Act of 1934, as amended, or the
Securities Act of 1933, as amended;
(i) promptly and in any event after becoming aware of the
occurrence of any of the following events:
(i) any Material Contract of the Borrower or any of its
Subsidiaries is terminated or amended or any new Material
Contract is entered into which is reasonably likely to have an
adverse effect on the Lenders (in which event the Borrower shall
provide the Agent with a copy of such Material Contract); or
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(ii) any of the material terms (other than price) upon
which material suppliers of the Borrower or any of its
Subsidiaries do business with the Borrower or such Subsidiary are
changed or amended the results of which are reasonably likely to
have an adverse effect on the Lenders; or
(iii) any order, judgment or decree in excess of $2,500,000
(after reasonably expected insurance and indemnity recovery)
shall have been entered against the Borrower or any of its
Subsidiaries or any of their respective properties or assets; or
(iv) any notification of violation of any Requirement of
Law shall have been received by the Borrower or any of its
Subsidiaries from any Governmental Authority the results of which
are likely to have a Material Adverse Effect; and
(j) from time to time, such further information, including
customer address list, regarding the Collateral, business affairs and
financial condition of the Borrower and/or each of the Borrower's
Subsidiaries as the Agent may reasonably request.
7.2 Inventory Reconciliation. The Borrower shall make available
when complete the results of any physical inventory count or reconciliation of
perpetual inventory to the general ledger.
7.3 Corporate Franchises. The Borrower will, and will cause each
of its Subsidiaries to, do or cause to be done, all things necessary to preserve
and keep in full force and effect its existence, material rights and authority
to do business, provided that any transaction permitted by Section 8.1 will not
constitute a breach of this Section 7.3, and provided further that the Borrower
shall not be required to preserve, with respect to itself, any material right or
authority to do business and with respect to any of its Subsidiaries, any such
existence, material right or authority to do business if the Borrower shall
reasonably determine that such preservation is no longer desirable in the
ordinary course of business, and the loss thereof shall not be reasonably likely
to have a Material Adverse Effect.
7.4 Compliance with Statutes, etc. (a) The Borrower will, and
will cause each of the Borrower's Subsidiaries to, comply with all applicable
statutes, regulations and orders of, and all applicable restrictions imposed by,
all governmental bodies, domestic or foreign, in respect of the conduct of its
business and the ownership of its property (including applicable Environmental
Laws) other than those the non-compliance with which (individually or in the
aggregate) would not have a Material Adverse Effect. Neither Borrower nor any of
Borrower's Subsidiaries will generate, use, treat, store, release or
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dispose of, or permit the generation, use, treatment, storage, release or
disposal of Hazardous Materials on any of its Real Property, or transport or
permit the transportation of Hazardous Materials to or from any such Real
Property, except for quantities used or stored at, and transferred to or from,
such Real Properties in material compliance with all applicable Environmental
Laws and required in connection with the normal operation, use and maintenance
of such Real Property or the operation of the business of the Borrower and its
Subsidiaries. If required to do so under any applicable Environmental Law, the
Borrower agrees to undertake, and agrees to cause each of its Subsidiaries to
undertake, any cleanup, removal, remedial or other action necessary to remove
and clean up any Hazardous Materials from any Real Property in accordance with
the requirements of all such applicable Environmental Laws and in accordance
with orders and directives of all governmental authorities; provided that
neither Borrower nor any of Borrower's Subsidiaries shall be required to take
any such action where same is being contested by appropriate legal proceedings
in good faith by Borrower or such Subsidiary.
(b) At the request of the Agent or the Required Lenders at any
time and from time to time, but in any event no more frequently than once a
year, the Borrower will provide, at the Borrower's sole cost and expense, an
environmental site assessment report or update concerning any Real Property of
the Borrower or any Subsidiary, prepared by an environmental consulting firm
reasonably acceptable to by the Agent, indicating the presence or release of
Hazardous Materials and the potential cost of any removal or remedial action in
connection with any Hazardous Materials on such Real Property; provided,
however, no such request may be made unless the Agent or the Required Lenders
reasonably believe that (i) the Borrower or any of its Subsidiaries is in
material noncompliance with any Environmental Law with respect to such Real
Property and such noncompliance is reasonably likely to result in a liability of
the Borrower in excess of $2,500,000 (after expected insurance and indemnity
recovery) in the aggregate or (ii) an Event of Default is in existence. If the
Borrower fails to provide the same after sixty (60) days' written notice, the
Agent may order the same, and the Borrower shall grant and hereby grants to the
Agent and the Lenders and their agents access to such Real Property at all
reasonable times and without unreasonably interfering with the Borrower's
operations and specifically grants the Agent and the Lenders an irrevocable
nonexclusive license, subject to the rights of tenants, to undertake such an
assessment all at the Borrower's sole expense.
7.5 ERISA. As soon as possible and, in any event, within ten (10)
days after the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate
knows or has reason to know of the occurrence of any of the following, the
Borrower will deliver to the Agent a certificate of the chief financial officer
of the Borrower setting forth the full details as to such occurrence and the
action, if any, that the Borrower, such Subsidiary or such ERISA Affiliate is
required or proposes to take, together with any notices required or proposed to
be given to or filed with or by the Borrower, the Subsidiary, the ERISA
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Affiliate, the PBGC, a Plan participant or the Plan administrator with respect
thereto: that a Reportable Event has occurred (except to the extent that the
Borrower has previously delivered to the Lenders a certificate and notices (if
any) concerning such event pursuant to the next clause hereof); that a
contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan
subject to Title IV of ERISA is subject to the advance reporting requirement of
PBGC Regulation Section 4043.61 (without regard to subparagraph (b)(1) thereof),
and an event described in subsection .62, .63, .64, .65, .66, .67 or .68 of PBGC
Regulation Section 4043 (other than to the extent to which the 30-day notice
period is waived pursuant to subsection .62, .63, .64 and .65, other than on
event referred to in subsection .65 which would be described in subsection
.32(c)(1) of such Regulation if it had already occurred) is reasonably expected
to occur with respect to such Plan within the following thirty (30) days; that
an accumulated funding deficiency, within the meaning of Section 412 of the Code
or Section 302 of ERISA, has been incurred after the Closing Date or an
application may be or has been made for a waiver or modification of the minimum
funding standard (including any required installment payments) or an extension
of any amortization period under Section 412 of the Code or Section 303 or 304
of ERISA with respect to a Plan; that any contribution required to be made with
respect to a Plan has not been timely made; that a Plan has been or may be
terminated, reorganized, partitioned or declared insolvent under Title IV of
ERISA; that a Plan has an Unfunded Current Liability which, when added to the
aggregate amount of Unfunded Current Liabilities with respect to all other
Plans, exceeds the aggregate amount of such Unfunded Current Liabilities that
existed on the Closing Date by $81,700,000; that proceedings may be or have been
instituted to terminate or appoint a trustee to administer a Plan which is
subject to Title IV of ERISA; that a proceeding has been instituted pursuant to
Section 515 of ERISA to collect a delinquent contribution to a Plan; that the
Borrower, any Subsidiary of the Borrower or any ERISA Affiliate will or may
incur any material liability (including any indirect, contingent, or secondary
liability) to or on account of the termination of or withdrawal from a Plan
under Section 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or with
respect to a Plan under Section 401(a)(29), 4971, 4975 or 4980 of the Code or
Section 409 or 502(i) or 502(l) of ERISA or with respect to a group health plan
(as defined in Section 607(1) of ERISA or Section 4980B(g)(2) of the Code) under
Section 4980B of the Code; or that the Borrower or any Subsidiary of the
Borrower may incur, while any Obligation is outstanding, any material liability
not existing on the Closing Date pursuant to any employee welfare benefit plan
(as defined in Section 3(1) of ERISA) that provides benefits to retired
employees or other former employees (other than as required by Section 601 of
ERISA) or any Plan. The Borrower will deliver to each of the Banks (i) a
complete copy of the annual report (on Internal Revenue Service Form
5500-series) of each Plan (including, to the extent required, the related
financial and actuarial statements and opinions and other supporting statements,
certifications, schedules and information) required to be filed with the
Internal Revenue Service and (ii) copies of any records, documents or other
information that must be furnished to the PBGC with respect to any Plan pursuant
to Section 4010 of ERISA. In addition to any certificates or notices delivered
to the Banks
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pursuant to the first sentence hereof, copies of annual reports and any records,
documents or other information required to be furnished to the PBGC, and any
material notices received by the Borrower, any Subsidiary of the Borrower or any
ERISA Affiliate with respect to any Plan shall be delivered to the Banks no
later than ten (10) days after the date such annual report has been filed with
the Internal Revenue Service or such records, documents and/or information has
been furnished to the PBGC or such notice has been received by the Borrower,
such Subsidiary or the ERISA Affiliate, as applicable.
7.6 Good Repair. The Borrower will, and will cause each of its
Subsidiaries to, use commercially reasonable efforts to provide that its
material properties and equipment used or useful in its business in whomsoever's
possession they may be, are kept in good repair, working order and condition,
normal wear and tear excepted and, subject to Section 8.4, that from time to
time there are made in such properties and equipment all needful and proper
repairs, renewals, replacements, extensions, additions, betterments and
improvements thereto, to the extent and in the manner customary for companies in
similar businesses.
7.7 Books and Records. The Borrower agrees to maintain, and to
cause each of its Subsidiaries to maintain, books and records pertaining to the
Collateral in such detail, form and scope as is consistent with good business
practice, and agrees that such books and records will reflect the Lenders'
interest in its Accounts. The Borrower agrees that the Collateral Agent or its
agents may enter upon the premises of Borrower or any of Borrower's Subsidiaries
at any time and from time to time, during normal business hours and upon
reasonable notice under the circumstances, and at any time at all during the
continuance of an Event of Default, for the purposes of (i) inspecting the
Collateral, (ii) inspecting and/or copying (at the Borrower's expense) any and
all records pertaining thereto, (iii) discussing the affairs, finances and
business of the Borrower with any officers, employees and directors of the
Borrower or with Auditors (it being understood that the Borrower shall be
entitled to have a representative present at any such discussions) and (iv)
verifying Eligible Accounts Receivable and/or Eligible Inventory. The Borrower
shall give the Collateral Agent fifteen days prior written notice of any change
in the location of any facility owned or leased by the Borrower or any of its
Subsidiaries where Collateral is located or in the location of its chief
executive office or place of business from the locations specified in Schedule
II, and to execute in advance of such change, cause to be filed and/or delivered
to the Collateral Agent any financing statements, Collateral Access Agreements
or other documents required by the Agent, all in form and substance satisfactory
to the Agent. The Borrower agrees to advise the Agent promptly, in sufficient
detail, of any substantial change relating to the type, quantity or quality of
the Collateral, or any event (other than a change in price) which could have an
adverse effect on the value of the Collateral or on the security interests
granted to the Collateral Agent, on behalf of the Lenders therein.
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7.8 Collateral Records. The Borrower agrees to execute and
deliver, and to cause each of its Subsidiaries to execute and deliver, to the
Collateral Agent, from time to time, solely for the Agent's convenience in
maintaining a record of the Collateral, such written statements and schedules as
the Collateral Agent may reasonably require, including, without limitation,
those described in Section 7.1 of this Credit Agreement, designating,
identifying or describing the Collateral pledged or granted to the Lenders under
the Collateral Documents. The failure by the Borrower or any of its
Subsidiaries, however, to promptly give the Agent such statements or schedules
shall not affect, diminish, modify or otherwise limit the Lenders' security
interests in the Collateral.
7.9 Security Interests. The Borrower shall, and shall cause each
of its Subsidiaries to, defend the Collateral against all claims and demands of
all Persons at any time claiming the same or any interest therein. The Borrower
shall comply with the requirements of all state and federal laws in order to
grant to the Lenders valid and perfected first priority security interests in
the Collateral, subject to Existing Liens and to any other Permitted Liens
arising after the date hereof pursuant to operation of law and which pursuant to
operation of law are prior to the perfected security interests created
hereunder. The Collateral Agent is hereby authorized by the Borrower to file any
UCC financing statements covering the Collateral whether or not the signatures
of the Borrower appear thereon. The Borrower shall do whatever the Collateral
Agent may reasonably request, from time to time, to effect the purposes of this
Credit Agreement and the other Credit Documents, including, without limitation,
filing notices of liens, UCC financing statements and amendments, renewals and
continuations thereof; cooperating with the Collateral Agent's representatives;
keeping stock records; obtaining waivers from landlords and mortgagees and from
warehousemen and their landlords and mortgagees; and, paying claims which might,
if unpaid, become a Lien on the Collateral other than a Permitted Lien.
7.10 Insurance; Casualty Loss. Schedule X hereto sets forth a
true and complete listing of all insurance maintained by the Borrower and each
of its Subsidiaries as of the Closing Date. The Borrower agrees to maintain, and
to cause each of its Subsidiaries to maintain, public liability insurance, third
party property damage insurance and replacement value (or such higher coverage
as the Borrower may obtain) insurance on the Collateral under such policies of
insurance, with such insurance companies, in such amounts and covering such
risks in at least such amounts and against at least such risks as are described
on Schedule X, or as are at all times satisfactory to the Agent in its
commercially reasonable judgment. All policies covering the Collateral are to
name the Collateral Agent as an additional insured and the Collateral Agent as
loss payee in case of loss, as its interests may appear, and are to contain such
other provisions as the Agent may reasonably require to fully protect the
Lenders' interest in the Collateral and to any payments to be made under such
policies. The Borrower shall provide written notice to the Agent of the
occurrence of any of the following events within ten Business Days after the
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occurrence of such event: any Collateral is (i) damaged or destroyed, or suffers
any other loss, or (ii) condemned, confiscated or otherwise taken, in whole or
in part, or the use thereof is otherwise diminished so as to render
impracticable or unreasonable the use of such Collateral or to materially
diminish its marketability, and in either case the amount of the damage,
destruction, loss or diminution in value is in excess of $2,000,000
(collectively, a "Casualty Loss"). The Borrower and/or the respective Subsidiary
shall diligently file and prosecute their claim or claims for any award or
payment in connection with a Casualty Loss. In the event of a Casualty Loss, the
Borrower shall pay to the Collateral Agent, promptly upon receipt thereof, any
and all net insurance proceeds and payments received by the Borrower or any
Subsidiary on account of damage, destruction, loss, condemnation or eminent
domain proceedings, whereupon the Collateral Agent shall, at the election of the
Required Lenders, in their sole discretion, either (a) apply the proceeds
realized from Casualty Losses to payment of accrued and unpaid interest or
outstanding principal under the Revolving Loans or (b) pay such proceeds to the
Borrower to be used to repair or replace the Collateral that was the subject of
the Casualty Loss. After the occurrence and during the continuance of an Event
of Default, (i) no settlement on account of any such Casualty Loss shall be made
without the consent of the Collateral Agent and (ii) the Collateral Agent may
participate in any such proceedings and the Borrower shall deliver to the
Collateral Agent such documents as may be requested by the Collateral Agent to
permit such participation and shall consult with the Collateral Agent, its
attorneys and agents in the making and prosecution of such claim or claims. The
Borrower hereby irrevocably authorizes and appoints the Collateral Agent its
attorney-in-fact, after the occurrence and during the continuance of an Event of
Default, to collect and receive for any such award or payment and to file and
prosecute such claim or claims, which power of attorney shall be irrevocable and
shall be deemed to be coupled with an interest, and the Borrower shall, upon
demand of the Collateral Agent, make, execute and deliver any and all
assignments and other instruments sufficient for the purpose of assigning any
such award or payment to the Collateral Agent for the benefit of the Lenders,
free and clear of any encumbrances of any kind or nature whatsoever, other than
the right of the Borrower to any insurance proceeds remaining after application
thereof by the Collateral Agent as provided in this Section 7.10.
7.11 Taxes. Borrower will, and will cause each of Borrower's
Subsidiaries to, pay and discharge all federal income and other material taxes,
assessments and governmental charges or levies imposed upon it or upon its
income or profits, or upon any properties belonging to it, or payable by it
pursuant to the Tax Sharing Agreements, in each case on a timely basis, and all
lawful claims which, if unpaid, might become a Lien or charge upon any
properties of Borrower or of any of Borrower's Subsidiaries; provided, that
neither Borrower nor any of Borrower's Subsidiaries shall be required to pay any
such tax, assessment, charge, levy or claim which is being contested in good
faith and by proper proceedings if it has maintained adequate reserves (in the
good faith judgment of the management of such Person) with respect thereto in
accordance with GAAP.
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7.12 End of Fiscal Years; Fiscal Quarters. The Borrower will, for
financial reporting purposes, cause (i) each of its, and each of its
Subsidiaries', fiscal years to end on December 31 of each year and (ii) each of
its, and each of its Subsidiaries', fiscal quarters to end on March 31, June 30,
September 30 and December 31.
7.13 Further Assurances. The Borrower shall take, and shall cause
each of the Borrower's Subsidiaries to take, all such further actions and
execute all such further documents and instruments as the Collateral Agent may
at any time reasonably determine to be necessary or desirable to further carry
out and consummate the transactions contemplated by the Credit Documents, to
cause the execution, delivery and performance of the Credit Documents to be duly
authorized and to perfect or protect the Liens (and the priority status thereof)
of the Collateral Agent on the Collateral. Furthermore, the Borrower shall cause
to be delivered to the Collateral Agent such opinions of counsel, title
insurance and other related documents as may be reasonably requested by the
Collateral Agent to assure itself that this Section 7.13 has been complied with.
7.14 Maintenance of Corporate Separateness. The Borrower will,
and will cause each of the Borrower's Subsidiaries to, satisfy customary
corporate formalities, including the holding of regular board of directors' and
shareholders' meetings and the maintenance of corporate offices and records, and
will not permit its financial information to be provided to creditors of
Consumers or its other Affiliates without indicating that the assets and
financial performance of the Borrower and its Subsidiaries are separate from
Consumers and its other Affiliates and will not provide financial support or
assurances to such creditors.
7.15 Interest Rate Agreement. On the date which is 180 days after
the Closing Date if the Bridge Senior Notes are outstanding, the Borrower will
enter into an Interest Rate Agreement mutually satisfactory to the Agent and the
Borrower capping the maximum rate of interest with respect to a portion of the
Revolving Loans, such portion to be determined by, at a rate to be determined
by, and on terms and conditions satisfactory to, the Agent.
7.16 Releases and Terminations. (a) On or prior to the 45th day
following the Closing Date, the Borrower shall have caused Old Anchor to execute
and file releases and terminations of any and all Liens, other than Existing
Liens, encumbering all assets purchased by the Borrower pursuant to the
Acquisition Documents necessary to satisfy paragraph 31 of the Sale Order.
(b) On or prior to the 60th day following the Closing Date, the
Borrower shall deliver to the Agent (at the Borrower's own cost) copies of
Request for Information or Copies (form UCC-11), or equivalent reports verifying
that all the releases and terminations described in Section 7.16(a) shall have
been properly recorded and filed.
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7.17 Perfection of Intellectual Property Security Interests. On
or prior to the 60th day following the Closing Date, the Borrower shall have
executed and delivered Assignments of Security Interests in Trademarks, Patents
and Copyrights (as such terms are defined in the Security Agreement) covering
all right, title and interest in each United States Xxxx, Patent and Copyright
(as such terms are defined in the Security Agreement) of the Borrower (other
than right, title and interest retained by O-I pursuant to by the Technical
Assistance and License Agreement).
7.18 Payment of Certain Plan Obligations. (a) The Borrower shall
make timely contributions to the Anchor Glass Container Corporation Service
Retirement Plan, the Anchor Glass Container Corporation Retirement Plan for
Salaried Employees and the Retirement Plan for Hourly Employees of Xxxxxxxxx
Glass Company and Associated Companies which are required to be made (x)
pursuant to the Plan Termination Agreement and (y) for fiscal years 1997, 1998
and 1999 pursuant to Sections 412 and 302 of ERISA and which, for fiscal year
1997, in the aggregate are estimated as of the Closing Date to be $29,300,000.
(b) Any payments required to be made to "top-up" the value of
Series A Preferred Stock received on the Closing Date in respect of the Plans
described above shall be made in the form of (x) no more than $250,000 in cash
and (y) additional shares of Series A Preferred Stock.
7.19 Name Change. On or prior to the fifth day following the
Closing Date, the Borrower shall have changed its name to Anchor Glass Container
Corporation and shall have notified the Agent of the same.
ARTICLE 8.
Negative Covenants
The Borrower hereby covenants and agrees that as of the Closing
Date, and thereafter, for so long as this Credit Agreement is in effect and
until the Total Commitments have terminated, no Letter of Credit or Revolving
Notes are outstanding and the Revolving Loans and Letter of Credit Obligations,
together with interest, Fees, Expenses and all other Obligations (other than any
indemnities described in Section 11.8 hereof which are not then due and payable)
incurred hereunder, are paid in full:
8.1 Consolidation, Merger, Sale or Purchase of Assets, etc. The
Borrower will not, and will not permit any of the Borrower's Subsidiaries to,
wind up, liquidate or dissolve its affairs, or enter into any transaction of
merger or consolidation, sell or otherwise dispose of all or any part of its
property or assets (other than inventory, obsolete
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equipment, excess equipment no longer needed in the conduct of business or
equipment being replaced with other equipment, in each case in the ordinary
course of business) or purchase, lease or otherwise acquire (in one transaction
or a series of related transactions) all or any part of the property or assets
of any Person (other than (i) to replace obsolete property or assets disposed of
in compliance with this Section and (ii) purchases, leases or other acquisitions
of goods, inventory and equipment, operating leases of property, in each case,
in the ordinary course of business) or agree to do any of the foregoing at any
future time, except that the following shall also be permitted:
(a) Capital Expenditures to the extent within the limitations set
forth in Section 8.4;
(b) the investments, acquisitions and transfers or dispositions
of properties permitted pursuant to Section 8.5;
(c) any Subsidiary of the Borrower may be merged or consolidated
with or into, or be liquidated into, the Borrower or any other
Subsidiary of the Borrower (so long as the Borrower or any other
Subsidiary of the Borrower is the surviving corporation), or all or any
part of the business, properties and assets of any Subsidiary may be
conveyed, leased, sold or transferred to the Borrower or any other
Subsidiary of the Borrower;
(d) Designated Property Sales; and
(e) the Borrower and its Subsidiaries may sell or otherwise
dispose of assets the Net Sale Proceeds of which do not exceed in the
aggregate $3,000,000 in any fiscal year of the Borrower.
To the extent the Required Lenders waive the provisions of this Section 8.1 with
respect to the sale of any Collateral, or any Collateral is sold as permitted by
this Section 8.1, such Collateral in each case shall be sold free and clear of
the Liens in favor of the Collateral Agent created by the Collateral Documents
and the Collateral Agent shall take such actions as it deems appropriate in
connection therewith or may be reasonably requested by the Borrower to evidence
such Lien release, in each case at the Borrower's expense.
8.2 Liens. Borrower will not, and will not permit any of
Borrower's Subsidiaries to, create, incur, assume or suffer to exist any Lien
upon or with respect to any property or assets of any kind (real or personal,
tangible or intangible) of the Borrower or any of its Subsidiaries, whether now
owned or hereafter acquired, or sell any such property or assets subject to an
understanding or agreement, contingent or otherwise, to repurchase such property
or assets (including sales of accounts receivable or notes with recourse to the
Borrower or any of Borrower's Subsidiaries) or assign any right to receive
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income, or file or permit the filing of any financing statement under the UCC or
any other similar notice of Lien under any similar recording or notice statute
(other than precautionary filings covering leases of equipment), except Liens
described below (herein referred to as "Permitted Liens"):
(a) Liens for taxes not yet due and payable or Liens for taxes
being contested in good faith and by appropriate proceedings for which
adequate reserves (in the good faith judgment of the management of the
Borrower) have been established;
(b) Liens in respect of property or assets of the Borrower or any
of its Subsidiaries imposed by law or which were incurred in the
ordinary course of business, such as carriers', warehousemen's and
mechanics' Liens, statutory landlord's Liens, Liens in favor of customs
and revenue authorities to secure payment of customs duties in
connection with the importation of goods, and other similar Liens
arising in the ordinary course of business, and (x) which, if any such
property or asset is material, do not in the aggregate materially
detract from the value of such property or assets or materially impair
the use thereof in the operation of the business of the Borrower or such
Subsidiary or (y) which are being contested in good faith by appropriate
proceedings, which proceedings have the effect of preventing the
forfeiture or sale of the property or asset subject to such Lien;
(c) Liens created by or pursuant to this Credit Agreement or the
other Credit Documents;
(d) Liens securing the Senior Notes pursuant to the Senior Note
Documents;
(e) Liens existing on the Closing Date and listed on Schedule XI
hereto without giving effect to any subsequent extensions, renewals or
replacements thereof ("Existing Liens");
(f) Liens (other than any Lien imposed by ERISA) incurred or
deposits made in the ordinary course of business (x) in connection with
liability insurance, workers' compensation, unemployment insurance and
other types of social security, or (y) to secure the performance of
tenders, statutory obligations, surety and appeal bonds, bids, leases,
government contracts, performance and return-of-money bonds and other
similar obligations incurred in the ordinary course of business, in an
aggregate amount (in the case of this clause (y)) not to exceed
$2,500,000 (exclusive of obligations (i) in respect of borrowed money or
(ii) in respect of which a Letter of Credit has been issued);
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(g) leases or subleases granted to third Persons not interfering
with the ordinary course of business of Borrower or any of its
Subsidiaries;
(h) Capital Leases to the extent permitted under Section 8.3(b);
(i) Liens (x) arising pursuant to purchase money mortgages
securing Indebtedness representing the purchase price (or financing of
the purchase price within 180 days after the respective purchase) of
property or other assets acquired by the Borrower, provided that (i) any
such Liens attach only to the assets so purchased, (ii) the Indebtedness
secured by any such Lien does not exceed 100% of the purchase price of
the assets being purchased and (iii) the Indebtedness secured thereby or
any refinancing thereof is permitted by Section 8.3(b); or (y) existing
on specific tangible assets at the time acquired by the Borrower or on
assets of a Person at the time such Person first becomes a Subsidiary;
provided, that (i) any such Liens were not created at the time of or in
contemplation of the acquisition of such assets or Person by the
Borrower, (ii) in the case of any such acquisition of a Person, any such
Lien attaches only to specific tangible assets of such Person and not
assets of such Person generally and (iii) the Indebtedness secured
thereby or any refinancing thereof is permitted by Section 8.3(b);
(j) easements, rights-of-way, restrictions and other similar
charges or encumbrances not interfering in any material respect with the
business of the Borrower and its Subsidiaries;
(k) Liens created under ERISA and under Environmental Laws that
are being contested in good faith and as to which adequate reserves have
been established to the extent required by GAAP and secure obligations
not in excess of $2,500,000 in the aggregate; and
(l) Liens not encumbering Collateral other than those described
in the preceding clauses (a) through (k) with respect to obligations not
in excess of $5,000,000 in the aggregate.
8.3 Indebtedness. Borrower will not, and will not permit any of
its Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness, except:
(a) Indebtedness incurred pursuant to this Credit Agreement and
the other Credit Documents;
(b) Capitalized Lease Obligations and Indebtedness of the
Borrower secured by Liens permitted by Section 8.2(i) in an aggregate
amount not to exceed $10,000,000 in any fiscal year;
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(c) Existing Indebtedness;
(d) Indebtedness of the Borrower evidenced by (x) the Bridge
Senior Notes in aggregate principal amount not to exceed $130,000,000
(less the amount of principal repayments thereof effected after the
Closing Date, except as provided in clause (y) below and plus the amount
of additional Bridge Senior Notes issued as pay-in-kind interest in lieu
of cash interest) and (y) the Permanent Senior Notes in an aggregate
principal amount not to exceed $150,000,000, so long as (i) the proceeds
thereof are used to repay in full the Bridge Senior Notes and (ii) the
holders thereof are subject to the Intercreditor Agreement (or any
Intercreditor Agreement substantially similar thereto and satisfactory
to the Agent);
(e) Indebtedness of the Borrower or any of its Wholly-Owned
Subsidiaries owing to the Borrower or any of its Wholly-Owned
Subsidiaries, in each case to the extent making such loan was permitted
in Section 8.5;
(f) Indebtedness of the Borrower or any of the Borrower's
Subsidiaries evidenced by guarantees, performance bonds and surety bonds
incurred in the ordinary course of business for purposes of insuring the
performance of the Borrower or such Subsidiary;
(g) Indebtedness under Interest Rate Agreements entered into in
accordance with Section 7.15;
(h) Indebtedness under Commodity Hedge Agreements entered into by
the Borrower or any Subsidiary in the ordinary course of business in
connection with operational needs and not for speculative purposes;
(i) Indebtedness of the Borrower or any of the Borrower's
Subsidiaries, in addition to other Indebtedness permitted under clauses
(a) through (g) above, in an aggregate principal amount not to exceed
$10,000,000 at any time outstanding.
(j) Indebtedness of the Borrower or any of the Borrower's
Subsidiaries incurred to refinance any Indebtedness described in
Sections 8.3(b) through 8.3(h).
8.4 Capital Expenditures. (a) The Borrower will not, and will not
permit any of its Subsidiaries to, make any Capital Expenditures, except that
during any fiscal year set forth below, the Borrower and its Subsidiaries may
make Capital Expenditures, so long as the aggregate amount of such Capital
Expenditures (other than with proceeds of Indebtedness received by the Borrower
and its Subsidiaries pursuant to Section 8.3(b)) does not exceed in any fiscal
year set forth below the amount set forth opposite such fiscal year below:
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Fiscal Year Ending Amount
------------------ ------
December 31, 1997 $37,000,000
December 31, 1998 $32,400,000
December 31, 1999 $29,800,000
December 31, 2000 $33,000,000
December 31, 2001 $34,000,000
(b) Notwithstanding the foregoing, in the event that the amount
of Capital Expenditures permitted to be made by the Borrower and its
Subsidiaries pursuant to clause (a) above in any fiscal year (before giving
effect to any increase in such permitted expenditure amount pursuant to this
clause (b)) is greater than the amount of such Capital Expenditures made by the
Borrower and its Subsidiaries during such fiscal year, such excess (the "CapEx
Rollover Amount") may be carried forward and utilized to make Capital
Expenditures in the immediately succeeding fiscal year, provided that in no
event shall the CapEx Rollover Amount in any fiscal year exceed 25% of the
amount of Capital Expenditures set forth opposite such fiscal year in the table
above.
(c) Notwithstanding the foregoing, the Borrower and its
Subsidiaries may make Capital Expenditures (which Capital Expenditures will not
be included in any determination under the foregoing clause (a)) with the
proceeds of Indebtedness received by the Borrower or any of its Subsidiaries
pursuant to Section 8.3(b) so long as after giving effect thereto, the total
amount of Capital Expenditures (including amounts expended pursuant to clause
(a) of this Section 8.4) does not exceed in any fiscal year set forth below the
amount set forth opposite such fiscal year below:
Fiscal Year Ending Amount
------------------ ------
December 31, 1997 $43,000,000
December 31, 1998 $37,400,000
December 31, 1999 $34,800,000
December 31, 2000 $38,000,000
December 31, 2001 $39,000,000
(d) Notwithstanding the foregoing, the Borrower and its
Subsidiaries may make Capital Expenditures (which Capital Expenditures will not
be included in any determination under the foregoing clause (a)) (i) with the
insurance proceeds received by the Borrower or any of its Subsidiaries from any
Casualty Loss so long as such Capital Expenditures are to replace or restore any
properties or assets in respect of which such proceeds were paid in accordance
with Section 7.10 and (ii) to the extent permitted by Section 6.4(iii) of the
Senior Credit Agreement.
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8.5 Investments. Borrower will not, and will not permit any of
Borrower's Subsidiaries to, lend money or credit or make advances to any Person,
or purchase or acquire any stock, obligations or securities of, or any other
interest in, or make any capital contribution to (collectively, "Investments")
any other Person, except:
(a) the Borrower or any of Borrower's Subsidiaries may acquire
and hold receivables owing to it, if created or acquired in the ordinary
course of business and payable or dischargeable in accordance with the
customary trade terms of the Borrower or its applicable Subsidiary, as
the case may be;
(b) loans and advances to employees, officers and directors in
the ordinary course of business in an aggregate principal amount not to
exceed $1,000,000 at any time outstanding shall be permitted;
(c) any Investment by any Subsidiary of the Borrower in the
Borrower (so long as any loan made by a Subsidiary of the Borrower to
the Borrower is subordinated to the Obligations on terms satisfactory to
the Agent) or in another Wholly-Owned Subsidiary of the Borrower;
(d) subject to Section 8.19, Investments in Cash Equivalents
shall be permitted;
(e) Investments by the Borrower and Borrower's Subsidiaries
permitted under Section 8.1 and Capital Expenditures permitted under
Section 8.4 shall be permitted;
(f) Investments existing on the Closing Date and listed on
Schedule XII hereto, without giving effect to any additions thereto or
replacements thereof, shall be permitted;
(g) Investments which may be deemed to exist as a result of the
entering into of Interest Rate Agreements to the extent permitted by
Section 8.3(g);
(h) the Borrower or any Subsidiary may enter into Commodity Hedge
Agreements in the ordinary course of business in connection with
operational needs and not for speculative purposes; and
(i) the Borrower may make the Xxxxx'x Payments; and
(j) any Investments in addition to those contemplated by the
foregoing clauses (a) through (g), provided that all Investments made
pursuant to this clause
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(h) shall be permitted by the Senior Note Documents and shall not exceed
$5,000,000 at any time outstanding.
8.6 Dividends, etc. The Borrower will not, and will not permit
any of its Subsidiaries to, declare or pay any dividends (other than dividends
payable solely in capital stock of the Borrower) or return any capital to, its
stockholders or authorize or make any other distribution, payment or delivery of
property or cash to its stockholders as such, or redeem, retire, purchase or
otherwise acquire, directly or indirectly, for a consideration (other than
consideration in the form of capital stock of the Borrower), any shares of any
class of its capital stock now or hereafter outstanding (or any warrants for or
options or stock appreciation rights in respect of any of such shares), or set
aside any funds for any of the foregoing purposes and the Borrower will not
permit any of its Subsidiaries to purchase or otherwise acquire for
consideration any shares of any class of the capital stock of the Borrower now
or hereafter outstanding (or any warrants for or options or stock appreciation
rights issued by such Person in respect of any such shares) (all of the
foregoing "Dividends"), except that (i) any Subsidiary of the Borrower may pay
Dividends to the Borrower; (ii) so long as (w) the Permanent Senior Note
Documents, if any, permit the payment of such Dividends, (x) the Bridge Senior
Notes are not outstanding, (y) the Interest Coverage Ratio for the most recently
completed period of four consecutive fiscal quarters (or, if shorter, the period
beginning on the Closing Date and ending on the last day of the most recently
completed fiscal quarter of the Borrower) after giving effect to such payment is
more than the ratio set forth below opposite such date:
Fiscal Quarter
Ended Ratio
----------------- ------
March 31, 1997 2.20:1
June 30, 1997 2.20:1
September 30, 1997 2.30:1
December 31, 1997 2.30:1
March 31, 1998 2.40:1
June 30, 1998 2.50:1
September 30, 1998 2.60:1
December 31, 1998 2.75:1
March 31, 1999 2.75:1
June 30, 1999 2.75:1
September 30, 1999 2.85:1
December 31, 1999 3.00:1
March 31, 2000 3.00:1
June 30, 2000 3.25:1
September 30, 2000 3.25:1
December 31, 2000 3.25:1
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March 31, 2001 3.25:1
June 30, 2001 3.25:1
September 30, 2001 3.25:1
December 31, 2001 3.25:1;
provided that if the Borrower shall have received proceeds of $150,000,000 or
more from the issuance of Permanent Senior Notes, the ratios for the periods
prior to December 31, 2000 shall be reduced by an amount equal to 0.10, and (z)
no Default or Event of Default then exists or would arise therefrom, the
Borrower may pay cash Dividends on the Series A Preferred Stock at the rate set
forth therein; (iii) so long as (w) the Permanent Senior Note Documents permit
the payment of such Dividends, (x) the Bridge Senior Notes are not outstanding
(y) the Interest Coverage Ratio for the most recently completed period of four
consecutive fiscal quarters (or, if shorter, the period beginning on the Closing
Date and ending on the last day of the most recently completed fiscal quarter of
the Borrower) after giving effect to such payment is more than the ratio set
forth below opposite such date:
Fiscal Quarter
Ended Ratio
------------------ --------
March 31, 1997 2.20:1
June 30, 1997 2.20:1
September 30, 1997 2.30:1
December 31, 1997 2.30:1
March 31, 1998 2.40:1
June 30, 1998 2.50:1
September 30, 1998 2.60:1
December 31, 1998 2.75:1
March 31, 1999 2.75:1
June 30, 1999 2.75:1
September 30, 1999 2.85:1
December 31, 1999 3.00:1
March 31, 2000 3.00:1
June 30, 2000 3.25:1
September 30, 2000 3.25:1
December 31, 2000 3.25:1
March 31, 2001 3.25:1
June 30, 2001 3.25:1
September 30, 2001 3.25:1
December 31, 2001 3.25:1;
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provided that if the Borrower shall have received proceeds of $150,000,000 or
more from the issuance of Permanent Senior Notes, the ratios for the periods
prior to December 31, 2000 shall be reduced by an amount equal to 0.10, and (z)
no Default or Event of Default then exists or would arise therefrom, at any time
after the earlier of (A) January 1, 2000 and (B) the date on which the Bridge
Senior Notes are no longer outstanding, the Borrower may pay cash Dividends on
the Series B Preferred Stock, at the rate set forth therein; and (iv) the
Borrower may pay Dividends on either series of Preferred Stock through
additional pay-in-kind shares of such series of Preferred Stock.
8.7 Transactions with Affiliates. (a) The Borrower shall not, and
shall not cause or permit any of its Subsidiaries to, directly or indirectly,
conduct any business or enter into or permit to exist any transaction or series
of related transactions (including, but not limited to, the purchase, sale,
conveyance, transfer, disposition, exchange or lease of property or assets, the
making of any Investment, the giving of any guarantee or the rendering of
services) with, or for the benefit of, any Affiliate of the Borrower or any
Subsidiary (each an "Affiliate Transaction"), except in the ordinary course of
business and under an agreement set forth in writing which is on terms that are
no less favorable to the Borrower or such Subsidiary, as the case may be, than
those that could not have been obtained in a comparable transaction on an
arms'-length basis from a Person not an Affiliate of the Borrower or such
Subsidiary. With respect to all Affiliate Transactions involving aggregate
payments equal to or in excess of $100,000 and less than $1,000,000, the
Borrower or such Subsidiary, as the case may be, shall have delivered an
officers' certificate to the Agent certifying that such transaction or series of
transactions complies with clause (y) above. All Affiliate Transactions (and
each series of related Affiliate Transactions which are similar or part of a
common plan) involving aggregate payments or other property with a fair market
value in excess of $1,000,000 and less than $2,500,000 shall be approved by a
majority vote of the independent members of the Board of Directors of the
Borrower or such Subsidiary, as the case may be, such approval to be evidenced
by a Board Resolution stating that such Board of Directors has determined that
such transaction complies with the foregoing provisions. If the Borrower or any
Subsidiary of the Borrower enters into an Affiliate Transaction (or a series of
related Affiliate Transactions related to a common plan) that involves an
aggregate fair market value of more than $2,500,000, the Borrower or such
Subsidiary, as the case may be, shall, prior to the consummation thereof, obtain
a favorable opinion as to the fairness of such transaction or series of related
transactions to the Borrower or the relevant Subsidiary, as the case may be,
from a financial point of view, from an Independent Financial Advisor and file
the same with the Agent. Notwithstanding anything to the contrary contained in
this Section 8.7(a), if the Borrower or any Subsidiary of the Borrower enters
into an Affiliate Transaction (or a series of related to Affiliate Transactions
relating to common plan) that involves the sale or disposition of machinery or
equipment in an aggregate fair market value of more than $1,000,000, the
Borrower or such Subsidiary as, as the case may be, shall, prior to the
consummation thereof, obtained a favorable opinion as to the fairness of such
transaction
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or series of related transactions to the Borrower or the relevant Subsidiary, as
the case may be, from a financial point of view, from an Independent Financial
Advisor and filed the same with the Agent. Notwithstanding anything to the
contrary contained in this Section 8.7(a), no Affiliate Transaction (or series
or related Affiliate Transactions relating to a common plan) (A) that involves
an aggregate fair market value (with fair market value of sales commissions paid
to be calculated on a net basis against sales commissions received) of more than
$5,000,0000 shall be permitted or (B) that involves an aggregate fair market
value, when added to the aggregate fair market value (with fair market value of
sales commissions paid to be calculated on a net basis against sales commissions
received) of all other Affiliate Transactions for any fiscal year of the
Borrower, of more than $7,500,000 shall be permitted.
(b) The foregoing restriction shall not apply to the following
transactions: (i) any transaction exclusively between the Company and any of its
Wholly-Owned Subsidiaries or exclusively between any of the Company's
Wholly-Owned Subsidiaries, (ii) reasonable and customary fees paid to members of
the board of directors of the Company and of its Subsidiaries, (iii) advances to
employees for moving, entertainment and travel expenses, drawing accounts and
similar expenditures in the ordinary course of business and (iv) reasonable and
customary fees and compensation paid to, and indemnity provided on behalf of,
officers, directors or employees of the Company or any of its Subsidiaries, as
determined by the Board of Directors of the Company or any such Subsidiary or
the senior management thereof in good faith, including, without limitation,
issuances of stock, payment of bonuses and other transactions pursuant to
employment or compensation agreements, stock option agreements, indemnification
agreements and other arrangements in effect on the Closing Date or substantially
similar thereto.
Notwithstanding the foregoing, the Borrower shall not, and shall
not permit its Subsidiaries to, (x) enter into any agreements with any
Affiliates thereof (or any officers or management of such Affiliates), or any
other person providing for management services (other than the Management
Agreements) or (y) make any payment on or with respect to (i) commissions,
consulting fees or any similar fees or compensation for management consulting
services or similar services provided by Affiliates to the Borrower or its
Subsidiaries and (ii) the Management Agreement between the Borrower and G&G
Investments, Inc., a Delaware corporation, (other than payments not to exceed
$1,500,000 in any fiscal year of the Borrower) provided such payments in excess
of $1,500,000 may be made if (u) the Senior Note Documents permit such payments,
(v) the Bridge Senior Notes are no longer outstanding, (w) the Interest Coverage
Ratio for the most recently completed period of four consecutive fiscal quarters
(or, if shorter, the period beginning on the Closing Date and ending on the last
day of the most recently completed fiscal quarter of the Borrower) both before
and after giving effect to such payment is more than the ratio set forth below
opposite such date:
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Fiscal Quarter
Ended Ratio
------------------- -------
March 31, 1997 2.20:1
June 30, 1997 2.20:1
September 30, 1997 2.30:1
December 31, 1997 2.30:1
March 31, 1998 2.40:1
June 30, 1998 2.50:1
September 30, 1998 2.60:1
December 31, 1998 2.75:1
March 31, 1999 2.75:1
June 30, 1999 2.75:1
September 30, 1999 2.85:1
December 31, 1999 3.00:1
March 31, 2000 3.00:1
June 30, 2000 3.25:1
September 30, 2000 3.25:1
December 31, 2000 3.25:1
March 31, 2001 3.25:1
June 30, 2001 3.25:1
September 30, 2001 3.25:1
December 31, 2001 3.25:1;
provided that if the Borrower shall have received proceeds of $150,000,000 or
more from the issuance of Permanent Senior Notes, the ratios for the periods
prior to December 31, 2000 shall be reduced by an amount equal to 0.10, (x) the
Available Borrowing Amount less the Outstandings at such time (both before and
after giving effect to any such payment) is more than $20,000,000, (y) such
payments do not exceed $3,000,000 in the aggregate in any fiscal year of the
Borrower and (z) no Default or Event of Default exists or would arise therefrom.
8.8 Changes in Business. The Borrower will not, and will not
permit its Subsidiaries to, alter the character of the business of the Borrower
and its Subsidiaries from that conducted by the Acquired Business on the Closing
Date.
8.9 Consolidated Net Worth. The Borrower shall at all times
maintain a Consolidated Net Worth at any time during any period set forth below
of not less than the amount set forth opposite such period set forth below
(increased for each such calculation by the net cash proceeds of any issuance of
Capital Stock by the Borrower after the Closing Date):
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Minimum
Consolidated
Period Net Worth
----------- --------------
Closing Date to March 31, 1997 $120,000,000
April 1, 1997 to June 30, 1997 $120,000,000
July 1, 1997 to September 30, 1997 $120,000,000
October 1, 1997 to December 31, 1997 $120,000,000
January 1, 1998 to March 31, 1998 $120,000,000
April 1, 1998 to June 30, 1998 $120,000,000
July 1, 1998 to September 30, 1998 $120,000,000
October 1, 1998 to December 31, 1998 $120,000,000
January 1, 1999 to March 31, 1999 $120,000,000
April 1, 1999 to June 30, 1999 $120,000,000
July 1, 1999 to September 30, 1999 $122,500,000
October 1, 1999 to December 31, 1999 $125,000,000
January 1, 2000 to March 31, 2000 $125,000,000
April 1, 2000 to June 30, 2000 $125,000,000
July 1, 2000 to September 30, 2000 $125,000,000
October 1, 2000 to December 31, 2000 $127,500,000
January 1, 2001 to March 31, 2001 $130,000,000
April 1, 2001 to June 30, 2001 $130,000,000
July 1, 2001 to September 30, 2001 $132,500,000
October 1, 2001 to December 31, 2001 $135,000,000;
provided that if the Borrower shall have received proceeds of $150,000,000 or
more from the issuance of Permanent Senior Notes, the amounts set forth above
shall be reduced by that amount equal to the incremental difference in interest
expense between an issuance of $130,000,000 in aggregate principal amount of
Permanent Senior Notes and the amount of Permanent Senior Notes actually issued
for such period.
8.10 Working Capital Ratio. The Borrower shall not permit its
Working Capital Ratio at any time to be less than (x) prior to December 31,
1999, 0.95:1.00 and (y) on December 31, 1999 and thereafter, 1.00:1.00.
8.11 Interest Coverage Ratio. The Borrower will not permit the
Interest Coverage Ratio for any period of four consecutive fiscal quarters (or,
if shorter, the period beginning on the Closing Date and ending on the last day
of each fiscal quarter of the Borrower specified below), in each case taken as
one accounting period, ended on a date set forth below to be less than the ratio
set forth opposite such date:
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Fiscal Quarter
Ended Ratio
------------------ ------
June 30, 1997 2.00:1
September 30, 1997 2.00:1
December 31, 1997 2.00:1
March 31, 1998 2.10:1
June 30, 1998 2.20:1
September 30, 1998 2.30:1
December 31, 1998 2.40:1
March 31, 1999 2.40:1
June 30, 1999 2.50:1
September 30, 1999 2.60:1
December 31, 1999 2.65:1
March 31, 2000 2.70:1
June 30, 2000 2.75:1
September 30, 2000 2.75:1
December 31, 2000 2.75:1
March 31, 2001 2.75:1
June 30, 2001 2.75:1
September 30, 2001 2.75:1
December 31, 2001 2.75:1;
provided that if the Borrower shall have received proceeds of $150,000,000 or
more from the issuance of Permanent Senior Notes, the ratios for the periods
prior to December 31, 2000 shall be reduced by an amount equal to 0.10.
8.12 Pay-in-Kind Interest. The Borrower shall pay interest on the
Bridge Senior Notes through the issuance of additional Bridge Senior Notes (and
not in cash) to the maximum extent permitted by the Senior Credit Agreement.
8.13 Creation of Subsidiaries. The Borrower will not create or
acquire any Subsidiaries without the consent of the Required Lenders (it being
understood that in connection with such consent, additional security agreements,
guaranties and related agreements may need to be entered into).
8.14 Additional Negative Pledges. The Borrower will not, and will
not permit any of its Subsidiaries to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective, or permit any of its
Subsidiaries to create or otherwise cause or suffer to exist or become
effective, directly or indirectly, (i) any prohibition or restriction (including
any agreement to provide equal and ratable security to any other Person in the
event a Lien is granted to or for the benefit of the Agent and the Lenders) on
the
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creation or existence of any Lien upon the assets of the Borrower or its
Subsidiaries, other than the restrictions contained in (i) the Transaction
Documents, (ii) any agreement relating to a Lien permitted pursuant to Section
8.2 as relating to the property encumbered thereby or (iii) restrictions
described in Section 8.17.
8.15 Limitation on Voluntary Payments and Modifications of
Indebtedness; Modifications of Governing Documents, Preferred Stock and Certain
Other Agreements; etc. Borrower will not, and will not permit any of Borrower's
Subsidiaries to:
(i) make (or give any notice in respect of) any voluntary or
optional payment or prepayment on or redemption or acquisition for value
of (including, without limitation, by way of depositing with the trustee
with respect thereto or any other Person money or securities before due
for the purpose of paying when due) exchange (except through the
issuance of Bridge Senior Notes which are "Term Notes" as contemplated
by the Bridge Senior Note Documents) or purchase, redeem or acquire for
value (whether as a result of a Change of Control, the consummation of
asset sales or otherwise) any Existing Indebtedness or Senior Notes,
except that (i) Bridge Senior Notes may be repaid with the proceeds of
the events described in Sections 2.5(f), (g) and (h), (ii) Bridge Senior
Notes may be repaid with the proceeds of Permanent Senior Notes in
compliance with Sections 2.5(f) and 8.3(d)(y) and (iii) Permanent Senior
Notes may be repaid or redeemed in compliance with the final sentence of
Section 2.5(k);
(ii) amend or modify, or permit the amendment or modification of,
any provision of any Existing Indebtedness Agreement or any Senior Note
Document;
(iii) amend, modify or change in any way adverse to the interests
of the Lenders, any Tax Sharing Agreement, the O-I Assurance Agreement,
the Technical Assistance and License Agreement, the Equity Financing
Documents (other than the Preferred Stock) any Management Agreement
(except as prohibited in clause (iv) below), any Acquisition Document,
its Certificate of Incorporation (including, without limitation, by the
filing or modification of any certificate of designation) or By-Laws, or
any agreement entered into by it, with respect to its capital stock
(including any Shareholders' Agreement), or enter into any new Tax
Sharing Agreement, Management Agreement or agreement with respect to its
capital stock which could in any way be adverse to the interests of the
Lenders;
(iv) amend, modify or change in any way any Preferred Stock (or
any Certificates of Designation relating thereto) or the Management
Agreement between the Borrower and G&G Investments, Inc., including in
connection with any extension of the original term thereof; and
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(v) without the consent of the Agent, amend the Affiliate
Transaction Agreement.
8.16 Issuance of Stock. (a) The Borrower shall not issue any
shares of capital stock after the Closing Date, other than (i) shares of Common
Stock to the extent not creating a Change of Control and (ii) shares of
Preferred Stock paid as pay-in-kind Dividends or the Preferred Stock issued on
the Closing Date and (b) the Borrower will not permit any of its Subsidiaries
directly or indirectly to issue, sell, assign, pledge or otherwise encumber or
dispose of any shares of its capital stock or other equity securities (or
warrants, rights or options to acquire shares or other equity securities) of
such Subsidiary to any Person other than the Borrower or another Wholly-Owned
Subsidiary, except, (i) to the extent permitted by Sections 8.1(c) and 8.5 and
(ii) for the issuance of directors' qualifying shares to the extent required by
applicable law.
8.17 Limitation on Restrictions Affecting Subsidiaries. The
Borrower will not, and will not permit any Subsidiary of the Borrower to,
directly, or indirectly, create or otherwise cause or suffer to exist any
encumbrance or restriction which prohibits or limits the ability of any
Subsidiary of the Borrower to (a) pay dividends or make other distributions or
pay any Indebtedness owed to the Borrower or any Subsidiary of the Borrower, (b)
make loans or advances to the Borrower or any Subsidiary of the Borrower, (c)
transfer any of its properties or assets to the Borrower or any Subsidiary of
the Borrower or (d) create, incur, assume or suffer to exist any lien upon any
of its property, assets or revenues, whether now owned or hereafter acquired,
other than encumbrances and restrictions arising under (i) applicable law, (ii)
this Credit Agreement and the other Transaction Documents, (iii) Indebtedness
permitted pursuant to Sections 8.3(c) and (d), (iv) customary provisions
restricting subletting or assignment of any lease governing a leasehold interest
of the Borrower or any of its Subsidiaries, (v) customary restrictions on
dispositions of real property interests found in reciprocal easement agreements
of the Borrower or any of its Subsidiaries, (vi) any agreement relating to
permitted Indebtedness incurred by a Subsidiary of the Borrower prior to the
date on which such Subsidiary was acquired by the Borrower or any other
Subsidiary of the Borrower and outstanding on such acquisition date, (vii) the
extension or continuation of contractual obligations in existence on the date
hereof, provided that any such encumbrances or restrictions contained in such
continuation are no less favorable to the Lenders than those encumbrances and
restrictions under or pursuant to the contractual obligations continued hereby,
and (viii) restrictions imposed under the agreements relating to Indebtedness
permitted under Section 8.3(b), provided that such restrictions apply only to
the property giving rise to such Indebtedness.
8.18 No Additional Bank Accounts. The Borrower will not, and will
not permit any of its Subsidiaries within the United States to, directly or
indirectly, open, maintain or otherwise have any checking, savings or other
deposit accounts at any bank or other financial institution where money is or
may be deposited or maintained with any
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Person, other than (i) the Concentration Account, the Sub-Collection Accounts,
the Collection Accounts, the Disbursement Account, the accounts created pursuant
to the Senior Note Documents and the accounts set forth on Schedule XII and (ii)
local accounts for xxxxx cash deposit in the ordinary course of business and in
compliance with Section 8.19.
8.19 No Excess Cash. The Borrower will not, and will not permit
any of its Subsidiaries to, directly or indirectly, maintain in the aggregate in
all of the checking, savings or other accounts (other than the Disbursement
Accounts, the Sub-Collection Accounts, the Collection Accounts, the
Concentration Account, the accounts created pursuant to the Senior Note
Documents and the payroll accounts) of the Borrower and its Subsidiaries total
cash balances and investments (including Investments in Cash Equivalents) in
excess of $500,000 at any time during which any Revolving Loans are outstanding
hereunder.
8.20 Operating Leases. The Borrower will not, and will not permit
any of its Subsidiaries to, make aggregate Operating Lease Payments in any
fiscal year in excess of $20,000,000.
8.21 Plant Closing Expenses. (a) The Borrower will not, and will
not permit any of its Subsidiaries to, make cash expenditures in connection with
the Plant Closures, in excess of the amount set forth opposite such fiscal year
below:
Fiscal Year
Ending Amount
----------------- -----------
December 31, 1997 $26,400,000
December 31, 1998 $21,000,000
December 31, 1999 $16,000,000
December 31, 2000 $11,000,000
December 31, 2001 $3,000,000
(b) Notwithstanding the foregoing, in the event that the amount
of cash expenditures permitted to be made by the Borrower and its Subsidiaries
pursuant to Plant Closures in any fiscal year (before giving effect to any
increase in such permitted expenditure amount pursuant to this clause (b)) is
greater than the amount of such cash expenditures made by the Borrower and its
Subsidiaries during such fiscal year, such excess (the "Plant Closures Rollover
Amount") may be carried forward and utilized to make cash expenditures pursuant
to Plant Closures in the immediately succeeding fiscal year, provided that in no
event shall the Plant Closures Rollover Amount in any fiscal year exceed 25% of
the amount of cash expenditures set forth opposite such fiscal year in the table
above.
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8.22 Minimum Availability. The Available Borrowing Amount less
the Outstandings shall not be less than $20,000,000.
8.23 Headquarters Lease. (a) The Borrower shall not, and shall
not permit any Subsidiary, to (i) incur any Indebtedness relating to the
Headquarters Lease (as defined in the Acquisition Agreement) as in effect on the
Closing Date or the real property leased pursuant thereto (the "Headquarters
Property"), (ii) make any payments to acquire all or any portion of the
Headquarters Property (or any part thereof), or make any Investment in any
Person holding an ownership interest in the Headquarters Property (or any part
thereof), (iii) make any payments in respect of the obligations of the Borrower
with respect to the Headquarters Lease and the Headquarters Property (other than
for rental payments) or (iv) except as provided in clause (b) below, lease all
or any portion of the Headquarters Property except on terms at least as
favorable as those contained in the Headquarters Lease as in effect on the
Closing Date.
(b) (i) The Lease Reserve Amount shall be increased by $2,500,000
on September 15, 1997 unless on or prior to such date, the Borrower
shall have delivered to the Agent a written bona fide offer to purchase
the Headquarters Property (which offer may, but need not be, subject to
a financing contingency) on terms and conditions, and from parties,
reasonably satisfactory to the Agent (provided that acceptability of the
purchase price shall be determined based on an appraisal delivered to
the Agent by the Borrower from appraisers, and in form and substance,
satisfactory to the Agent) (an offer meeting the foregoing requirements,
a "Qualified Offer"). Additionally, the Lease Reserve Amount shall be
increased by $2,500,000 if at any time after September 15, 1997, a
Qualified Offer previously delivered fails to remain in full force and
effect.
(ii) The Lease Reserve Amount shall be increased by $2,500,000 on
November 15, 1997 unless on or before such date the Agent shall have
received a Qualified Offer which either (x) is not subject to a
financing contingency, in which case the Agent shall need to be
satisfied with the financial ability of the parties to the Qualified
Offer to consummate the sale of the Headquarters Property pursuant
thereto or (y) is accompanied by a bona fide financing commitment for
the Qualified Offer from parties, and on terms and conditions,
reasonably satisfactory to the Agent. Additionally, the Lease Reserve
Amount shall be increased by $2,500,000 if at any time after November
15, 1997 a financing commitment with respect to a Qualified Offer fails
to remain in full force and effect.
(iii) On or prior to January 2, 1998, the Borrower shall have
effected a sale or other disposition of the Headquarters Property, or
effect another transaction with respect thereto such that giving effect
to such sale, disposition or other transaction, neither U.S. Holdco, the
Borrower nor any Subsidiaries thereof shall
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have any obligations or liabilities (contingent or otherwise, including
without limitation, guaranties, indemnities or purchase obligations)
with respect to the Headquarters Property other than the payment of rent
(if the Borrower is the occupant thereof and related customary
obligations not to exceed the lesser of (x), the market rent for the
Headquarters Property and (y) $150,000 per month.
(iv) The Lease Reserve Amount shall be reduced to zero if (x) the
Borrower is required to make escrow payments on February 1, 1998 in
respect of the Headquarters Lease if no Default or Event of Default then
exists or would arise therefrom or (y) the Borrower is released from all
obligations in respect of the Headquarters Lease and the Headquarters
Properties.
8.24 Account Terms. The Borrower shall, and shall cause each of
its Subsidiaries to, promptly pay when due, or in conformity with customary
trade terms consistent with past practices, all of their trade accounts payable,
except for late payment in the ordinary course of business, the lateness of
which payment, singly or in the aggregate, could not reasonably be expected to
(i) have a Material Adverse Effect or (ii) materially change the Borrower's
ability to comply with Section 8.22.
ARTICLE 9.
Events of Default and Remedies
9.1 Events of Default. Upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Payments. The Borrower shall (i) default in the payment when
due of any principal of the Revolving Loans or (ii) default, and such default
shall continue for three or more days, in the payment when due of, any interest
on the Revolving Loans or any drawings under Letters of Credit which have not
been reimbursed by the Borrower (including through the incurrence of Revolving
Loans), or (iii) default, and such default shall continue for three or more days
after written demand therefor by the Agent, in the payment when due of any Fees,
Expense or any other amounts owing hereunder or under any other Credit Document;
or
(b) Representations, etc. Any representation, warranty or
statement made by U.S. Holdco, the Borrower or any of its Subsidiaries herein or
in any other Credit Document or in any statement or certificate delivered or
required to be delivered pursuant hereto or thereto shall prove to be untrue in
any material respect on the date as of which made or deemed made; or
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(c) Covenants. The Borrower shall (i) default in the due
performance or observance by it of any term, covenant or agreement contained in
Sections 7.12, 7.13, 7.17, 7.18 or 7.19, or Article 8, or (ii) default in the
due performance or observance by it of any term, covenant or agreement (other
than those referred to in Section 9.1(a), 9.1(b) or clause (i) of this Section
9.1(c)) contained in this Credit Agreement or the other Credit Documents and
such default shall continue unremedied for a period of at least 15 days after
notice to the defaulting party by the Agent or the Required Lenders; or
(d) Default Under Other Agreements. (I) The Borrower or any of
Borrower's Subsidiaries shall (i) default in any payment in respect of any
Indebtedness (other than the Obligations) in excess of $5,000,000 beyond the
period of grace, if any, provided in the agreement or instrument under which
such Indebtedness was issued or (ii) default in the observance or performance of
any 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 holders of such
Indebtedness (or a trustee or agent on behalf of such holder or holders) to
cause (determined without regard to whether any notice is required to so cause),
any such Indebtedness to become due prior to its stated maturity or (iii) any
such Indebtedness of the Borrower or any such Subsidiary shall be declared to be
due and payable, or required to be prepaid other than by a regularly scheduled
required prepayment or as a mandatory prepayment, prior to the stated maturity
thereof; or (II) at any time prior to the payment in full of the Bridge Senior
Notes and the Anchor Bridge Loan (as defined in the TD Loan Agreement),
Consumers or any of Consumer's Subsidiaries (other than the Borrower and its
Subsidiaries) shall (i) default in any payment in respect of any Indebtedness
(other than the Obligations) in excess of $5,000,000 beyond the period of grace,
if any, provided in the agreement or instrument under which such Indebtedness
was issued or (ii) default in the observance or performance of any 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 and the effect of which default or other event or
condition is to (A) permit the holder or holders of such Indebtedness (or a
trustee or agent on behalf of such holder or holders) to cause (determined
without regard to whether any notice is required to so cause but after giving
effect to any grace period with respect thereto), any such Indebtedness to
become due prior to its stated maturity and such default, event or condition
remains unremedial or unwaived for 15 days or (B) cause such Indebtedness to
become due prior to its stated maturity thereof or (iii) any such Indebtedness
of Consumers or any such Subsidiary shall be declared to be due and payable, or
required to be prepaid other than by a regularly scheduled required prepayment
or as a mandatory prepayment, prior to the stated maturity; or
(e) Bankruptcy, etc. The Borrower or any of its Subsidiaries,
Canadian Holdco, U.S. Holdco or Consumers, shall commence a voluntary case
concerning itself
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under Title 11 of the United States Code entitled "Bankruptcy", as now or
hereafter in effect, or any successor thereto (the "Bankruptcy Code"); or an
involuntary case is commenced against the Borrower or any of its Subsidiaries,
Canadian Holdco, U.S. Holdco or Consumers, and the petition is not controverted
within 30 days, or is not dismissed within 60 days, after commencement of the
case; or a custodian (as defined in the Bankruptcy Code) is appointed for, or
takes charge of, all or substantially all of the property of the Borrower or any
of its Subsidiaries, Canadian Holdco, U.S. Holdco or Consumers; or the Borrower
or any of its Subsidiaries, Canadian Holdco, U.S. Holdco or Consumers, commences
any other proceeding under any reorganization, arrangement, adjustment of debt,
relief of debtors, dissolution, insolvency or liquidation or similar law of any
jurisdiction whether now or hereafter in effect relating to the Borrower or such
Subsidiary; or there is commenced against the Borrower or any of its
Subsidiaries, Canadian Holdco, U.S. Holdco or Consumers, any such proceeding
which remains undismissed for a period of 60 days; or the Borrower or any of its
Subsidiaries, Canadian Holdco, U.S. Holdco or Consumers, is adjudicated
insolvent or bankrupt; or any order of relief or other order approving any such
case or proceeding is entered; or the Borrower or any of its Subsidiaries,
Canadian Holdco, U.S. Holdco or Consumers, suffers any appointment of any
custodian or the like for it or any substantial part of its property to continue
undischarged or unstayed for a period of 60 days; or the Borrower or any of its
Subsidiaries, Canadian Holdco, U.S. Holdco or Consumers, makes a general
assignment for the benefit of creditors; or any corporate action is taken by the
Borrower or any of its Subsidiaries, Canadian Holdco, U.S. Holdco or Consumers,
for the purpose of effecting any of the foregoing; or
(f) ERISA. (i) Any Plan shall fail to satisfy the minimum funding
standard required for any plan year or part thereof after the Closing Date under
Section 412 of the Code or Section 302 of ERISA or a waiver of such standard or
extension of any amortization period is sought or granted under Section 412 of
the Code or Section 303 or 304 of ERISA, a Reportable Event shall have occurred,
a contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan
subject to Title IV of ERISA shall be subject to the advance reporting
requirement of PBGC Regulation Section 4043.61 (without regard to subparagraph
(b)(1) thereof) and an event described in subsection .62, .63, .64, .65, .66,
.67 or .68 of PBGC Regulation Section 4043 shall be reasonably expected to occur
with respect to such Plan within the following 30 days, any Plan which is
subject to Title IV of ERISA shall have had or is likely to have a trustee
appointed to administer such Plan, any Plan which is subject to Title IV of
ERISA is, shall have been or is likely to be terminated or to be the subject of
termination proceedings under ERISA, any Plan shall have an Unfunded Current
Liability, a contribution required to be made with respect to a Plan has not
been timely made, the Borrower or any Subsidiary of the Borrower or any ERISA
Affiliate has incurred or is likely to incur any liability to or on account of a
Plan under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204
or 4212 of ERISA or Section 401(a)(29), 4971 or 4975 of the Code or on account
of a group health plan (as
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defined in Section 607(1) of ERISA or Section 4980B(g)(2) of the Code) under
Section 4980B of the Code, or the Borrower or any Subsidiary of the Borrower has
incurred or is likely to incur liabilities pursuant to one or more employee
welfare benefit plans (as defined in Section 3(1) of ERISA) that provide
benefits to retired employees or other former employees (other than as required
by Section 601 of ERISA) or Plans; (ii) there shall result from any such event
or events the imposition of a lien, the granting of a security interest, or a
liability or a material risk of incurring a liability; and (iii) such lien,
security interest or liability, individually, and/or in the aggregate, in the
opinion of the Required Lenders, has had, or could reasonably be expected to
have, a Material Adverse Effect; or
(g) Collateral Documents. Any Collateral Document shall cease to
be in full force and effect, or shall cease to give the Collateral Agent on
behalf of the Lenders the Liens, rights, powers and privileges purported to be
created thereby in favor of the Collateral Agent, U.S. Holdco or the Borrower,
as the case may be, shall default in any material respect in the due performance
or observance of any term, covenant or agreement on its part to be performed or
observed pursuant to any such Collateral Document and such default shall
continue unremedied for a period of at least 15 days after notice to the
Borrower by the Agent or the Required Lenders; or
(h) Judgments. One or more judgments or decrees shall be entered
against the Borrower or any of Borrower's Subsidiaries involving a liability of
$5,000,000 or more in the case of any one such judgment or decree (to the extent
not paid or covered by insurance provided by a carrier that has acknowledged
coverage) and all such judgments or decrees shall not have been vacated,
discharged or stayed pending appeal within 60 days from the entry thereof; or
(i) Change of Control. A Change of Control shall occur;
(j) U.S. Holdco Guaranty. The U.S. Holdco Guaranty shall cease to
be in full force and effect, or U.S. Holdco shall default in any material
respect in the due performance or observance of any term, covenant or agreement
on its part to be performed or observed pursuant thereto or U.S. Holdco shall
deny or disaffirm any of its obligations thereunder and such default, denial or
disaffirmation shall continue unremedied for a period of at least 15 days after
notice to the Borrower by the Agent or the Required Lenders; or
(k) Technical Assistance and License Agreement. The Technical
Assistance and License Agreement shall terminate or O-I shall deliver a notice
of termination in respect thereof or the Company or any of its Subsidiaries
shall not be, or shall cease to be, a Licensee Group Member (as defined therein)
entitled to the benefits thereunder; or
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(l) Canadian Holdco. Any creditors of Canadian Holdco or its
Subsidiaries shall take any action in connection with the realization or
foreclosure on the capital stock of U.S. Holdco;
(m) Affiliate Transactions Agreement. The Affiliate Transactions
Agreement shall cease to be in full force and effect, or any party thereto shall
default in any material respect in due performance or observance of any term,
covenant or agreement on its part to be performed or observed pursuant thereto
or any party thereto shall deny or disaffirm any of its obligations thereunder
and such default, denial, or disaffirmation shall continue unremedied for a
period of at least fifteen days after notice to the Borrower by the Agent or the
Required Lenders; or
(n) Capital Call Agreement. The Capital Call Agreement shall
cease to be in full force and effect, or Consumers shall default in any material
respect in due performance or observance of any term, covenant or agreement on
its part to be performed or observed pursuant thereto or any party thereto shall
deny or disaffirm any of its obligations thereunder;
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Agent shall, upon the written request of the
Required Lenders, by written notice to the Borrower, take any or all of the
following actions, without prejudice to the rights of the Agent or any Lender to
enforce its claims against the Borrower, except as otherwise specifically
provided for in this Credit Agreement (provided that, if an Event of Default
specified in Section 9.1(e) shall occur with respect to the Borrower, the result
which would occur upon the giving of written notice by the Agent as specified in
clauses (i) and (ii) below shall occur automatically without the giving of any
such notice): (i) declare the Total Commitments terminated, whereupon the
Commitment of each Lender shall forthwith terminate immediately and any Unused
Line Fee accrued and unpaid shall forthwith become due and payable without any
other notice of any kind; (ii) declare the principal of and any accrued interest
in respect of all Revolving Loans and all Obligations owing hereunder to be,
whereupon the same shall become, forthwith due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
the Borrower; (iii) direct the Collateral Agent to enforce any or all of the
Liens and security interests created pursuant to the Collateral Documents; (iv)
terminate any Letter of Credit which may be terminated in accordance with its
terms; and/or (v) direct the Borrower to pay (and the Borrower hereby agrees
upon receipt of such notice, or upon the occurrence of any Event of Default
specified in Section 9.1(e) in respect of the Borrower, it will pay) to the
Payments Administrator at its Payment Office such additional amounts of cash, to
be held as security for the Borrower's reimbursement obligations in respect of
Letter of Credit then outstanding equal to the aggregate of all Letters of
Credit Obligations.
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ARTICLE 10.
The Agent
10.1 Appointment. (a) Each Lender hereby designates BTCC as Agent
(for purposes of this Section 10, the term "Agent" shall include BTCC as
Payments Administrator and as Collateral Agent under the Collateral Documents,
to act as herein specified. Each Lender hereby irrevocably authorizes, and each
holder of any Revolving Note or participation in any Letter of Credit by the
acceptance of a Revolving Note or participation shall be deemed irrevocably to
authorize, the Agent to take such action on its behalf under the provisions of
this Credit Agreement and the Revolving Notes and any other instruments and
agreements referred to herein and to exercise such powers and to perform such
duties hereunder and thereunder as are specifically delegated to or required of
the Agent by the terms hereof and thereof and such other powers as are
reasonably incidental thereto. The Collateral Agent shall hold all Collateral
and the Payments Administrator shall hold all payments of principal, interest,
Fees, charges and Expenses received pursuant to this Credit Agreement or any
other Credit Document for the benefit of the Lenders to be distributed as
provided herein. The Agent may perform any of its duties hereunder by or through
its agents or employees.
(b) The provisions of this Article 10 are solely for the benefit
of the Agent and the Lenders, and neither the Borrower nor any of the Borrower's
Subsidiaries shall have any rights as a third party beneficiary of any of the
provisions hereof (other than Sections 10.9 and 10.10(c)). In performing its
functions and duties under this Credit Agreement, the Agent shall act solely as
agent of the Lenders and does not assume and shall not be deemed to have assumed
any obligation toward or relationship of agency or trust with or for the
Borrower or any of the Borrower's Subsidiaries.
10.2 Nature of Duties of Agent. The Agent shall not have duties
or responsibilities except those expressly set forth in this Credit Agreement
and the other Credit Documents. Neither the Agent nor any of its officers,
directors, employees or agents shall be liable for any action taken or omitted
by it as such hereunder or in connection herewith, unless caused by its or their
gross negligence or willful misconduct. The duties of the Agent shall be
mechanical and administrative in nature; the Agent shall not have by reason of
this Credit Agreement or the other Credit Documents a fiduciary relationship in
respect of any Lender; and nothing in this Credit Agreement or the other Credit
Documents, expressed or implied, is intended to or shall be so construed as to
impose upon the Agent any obligations in respect of this Credit Agreement or the
other Credit Documents except as expressly set forth herein or therein.
10.3 Lack of Reliance on Agent. (a) Independently and without
reliance upon the Agent, each Lender, to the extent it deems appropriate, has
made and shall con-
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tinue to make (i) its own independent investigation of the financial or other
condition and affairs of the Borrower and its Subsidiaries in connection with
the taking or not taking of any action in connection herewith and (ii) its own
appraisal of the creditworthiness of the Borrower and its Subsidiaries, and,
except as expressly provided in this Credit Agreement, the Agent shall not have
any duty or responsibility, either initially or on a continuing basis, to
provide any Lender with any credit or other information with respect thereto,
whether coming into its possession before the making of the Loans or at any time
or times thereafter.
(b) The Agent shall not be responsible to any Lender for any
recitals, statements, information, representations or warranties herein or in
any document, certificate or other writing delivered in connection herewith or
for the execution, effectiveness, genuineness, validity, enforceability,
collectibility, priority or sufficiency of this Credit Agreement or the other
Credit Documents or the financial or other condition of the Borrower or any of
its Subsidiaries. The Agent shall not be required to make any inquiry concerning
either the performance or observance of any of the terms, provisions or
conditions of this Credit Agreement or the other Credit Documents, or the
financial condition of the Borrower or any of Borrower's Subsidiaries, or the
existence or possible existence of any Default or Event of Default, unless
specifically requested to do so in writing by any Lender.
10.4 Certain Rights of the Agent. The Agent shall have the right
to request instructions from the Required Lenders at any time. If the Agent
shall request instructions from the Required Lenders with respect to any act or
action (including the failure to act) in connection with this Credit Agreement
or the other Credit Documents, the Agent shall be entitled to refrain from such
act or taking such action unless and until the Agent shall have received
instructions from the Required Lenders, and the Agent shall not incur liability
to any Person by reason of so refraining. Without limiting the foregoing, no
Lender shall have any right of action whatsoever against the Agent as a result
of the Agent acting or refraining from acting hereunder in accordance with the
instructions of the Required Lenders.
10.5 Reliance by Agent. The Agent shall be entitled to rely, and
shall be fully protected in relying, upon any note, writing, resolution, notice,
statement, certificate, telex, teletype or telecopier message, cablegram,
radiogram, order or other documentary, teletransmission or telephone message
believed by it to be genuine and correct and to have been signed, sent or made
by the proper person. The Agent may consult with legal counsel (including
counsel for the Borrower with respect to matters concerning the Borrower and its
Subsidiaries), independent public accountants and other experts selected by it
and shall not be liable for any action taken or omitted to be taken by it in
good faith in accordance with the advice of such counsel, accountants or
experts.
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10.6 Indemnification of Agent. To the extent the Agent is not
reimbursed and indemnified by the Borrower, each Lender will reimburse and
indemnify the Agent, in proportion to its respective Commitment, for and against
any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses (including counsel fees and disbursements) or
disbursements of any kind or nature whatsoever (including all Expenses) which
may be imposed on, incurred by or asserted against the Agent in performing its
duties hereunder, in any way relating to or arising out of this Credit
Agreement; provided, that no Lender shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the Agent's gross negligence or
willful misconduct. The agreements contained in this Section shall survive any
termination of this Credit Agreement and the other Credit Documents and the
payment in full of the Obligations.
10.7 The Agent in its Individual Capacity. With respect to its
obligation to lend under this Credit Agreement, the Loans made by it and the
Revolving Notes issued to it, and its participation in Letters of Credit issued
hereunder, the Agent shall have the same rights and powers hereunder as any
other Lender or holder of a Revolving Note or participation interests and may
exercise the same as though it was not performing the duties specified herein;
and the terms "Lenders," "Required Lenders," "holders of Revolving Notes," or
any similar terms shall, unless the context clearly otherwise indicates, include
the Agent in its individual capacity. The Agent may accept deposits from, lend
money to, acquire equity interests in, and generally engage in any kind of
banking, trust, financial advisory or other business with Borrower or any
Affiliate of Borrower as if it were not performing the duties specified herein,
and may accept fees and other consideration from Borrower for services in
connection with this Credit Agreement and otherwise without having to account
for the same to the Lenders.
10.8 Holders of Notes. The Agent may deem and treat the payee of
any Revolving Note as the owner thereof for all purposes hereof unless and until
a written notice of the assignment or transfer thereof shall have been filed
with the Agent. Any request, authority or consent of any Person who, at the time
of making such request or giving such authority or consent, is the holder of any
Revolving Note, shall be conclusive and binding on any subsequent holder,
transferee or assignee of such Revolving Note or of any Revolving Note or
Revolving Notes issued in exchange therefor.
10.9 Successor Agent. (a) The Agent may, upon five (5) Business
Days' notice to the Lenders and the Borrower, resign at any time (effective upon
the appointment of a successor Agent pursuant to the provisions of this Section
10.9) by giving written notice thereof to the Lenders and the Borrower. Such
resignation of the Agent shall also operate as a resignation as an Issuing Bank
and as Payments Administrator. Upon any such resignation, and if PNC Bank is a
Lender at the time of such resignation, PNC Bank shall be appointed as the
successor Agent. If PNC Bank shall not accept such appointment, is
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not a Lender, or is the resigning Agent, the Required Lenders shall have the
right, upon five (5) days' notice and approval by the Borrower (which approval
shall not be unreasonably withheld), to appoint a successor Agent which shall
also serve as a successor Issuing Bank. If no successor Agent (i) shall have
been so appointed by the Required Lenders, and (ii) shall have accepted such
appointment, within thirty (30) days after the retiring Agent's giving of notice
of resignation, then, upon five (5) days' notice, the retiring Agent may, on
behalf of the Lenders, appoint a successor Agent, which shall also serve as a
successor Issuing Bank. In the event that no successor Agent is appointed
pursuant to the foregoing provisions, the Agent's resignation shall become
effective on the date which is forty-five (45) days after the retiring Agent's
giving of notice of resignation, and the Required Lenders shall perform the
duties of the Agent hereunder.
(b) Upon the acceptance of any appointment as Agent hereunder by
a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations under
this Credit Agreement. After any retiring Agent's resignation hereunder as
Agent, the provisions of this Article 10 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under this Credit
Agreement.
10.10 Collateral Matters. (a) Each Lender authorizes and directs
the Collateral Agent to enter into the Collateral Documents for the benefit of
the Lenders. Each Lender hereby agrees, and each holder of any Revolving Note or
participant in Letters of Credit by the acceptance thereof will be deemed to
agree, that, except as otherwise set forth herein, any action taken by the
Required Lenders in accordance with the provisions of this Credit Agreement or
the Collateral Documents, and the exercise by the Required Lenders of the powers
set forth herein or therein, together with such other powers as are reasonably
incidental thereto, shall be authorized and binding upon all of the Lenders. The
Collateral Agent is hereby authorized on behalf of all of the Lenders, without
the necessity of any notice to or further consent from any Lender, from time to
time prior to an Event of Default, to take any action with respect to any
Collateral or Collateral Documents which may be necessary to perfect and
maintain perfected the security interest in and liens upon the Collateral
granted pursuant to the Collateral Documents.
(b) The Lenders hereby authorize the Collateral Agent, at its
option and in its discretion, upon the direction of the Agent to release any
Lien granted to or held by the Collateral Agent upon any Collateral (i) upon
termination of the Commitments and payment and satisfaction of all of the
Obligations at any time arising under or in respect of this Credit Agreement or
the Credit Documents or the transactions contemplated hereby or thereby, (ii)
constituting property being sold or disposed of upon receipt of the proceeds of
such sale by the Collateral Agent if the Borrower certifies to the Collateral
Agent that the sale or disposition is made in compliance with Section 8.1 hereof
(and the Agent may
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rely conclusively on any such certificate, without further inquiry) or (iii) if
approved, authorized or ratified in writing by the Required Lenders, unless such
release is required to be approved by all of the Lenders hereunder. Upon request
by the Agent at any time, the Lenders will confirm in writing the Collateral
Agent's authority to release particular types or items of Collateral pursuant to
this Section 10.10.
(c) Upon any sale and transfer of Collateral which is expressly
permitted pursuant to the terms of this Credit Agreement, or consented to in
writing by the Required Lenders or all of the Lenders, as applicable, and upon
at least five (5) Business Days' prior written request by the Borrower, the
Collateral Agent shall (and is hereby irrevocably authorized by the Lenders to)
execute such documents as may be necessary to evidence the release of the Liens
granted to the Collateral Agent for the benefit of the Lenders herein or
pursuant hereto upon the Collateral that was sold or transferred; provided, that
(i) the Collateral Agent shall not be required to execute any such document on
terms which, in the Collateral Agent's opinion, would expose the Collateral
Agent to liability or create any obligation or entail any consequence other than
the release of such Liens without recourse, representation or warranty and (ii)
such release shall not in any manner discharge, affect or impair the Obligations
or any Liens upon (or obligations of the Borrower or any of its Subsidiaries in
respect of) all interests retained by the Borrower or any of its Subsidiaries,
including, without limitation, the proceeds of the sale, all of which shall
continue to constitute part of the Collateral. In the event of any sale or
transfer of Collateral, or any foreclosure with respect to any of the
Collateral, the Collateral Agent shall be authorized to deduct all of the
Expenses reasonably incurred by the Collateral Agent from the proceeds of any
such sale, transfer or foreclosure.
(d) The Collateral Agent shall have no obligation whatsoever to
the Lenders or to any other Person to assure that the Collateral exists or is
owned by the Borrower or any of its Subsidiaries or is cared for, protected or
insured or that the Liens granted to the Collateral Agent herein or pursuant
hereto have been properly or sufficiently or lawfully created, perfected,
protected or enforced or are entitled to any particular priority, or to exercise
or to continue exercising at all or in any manner or under any duty of care,
disclosure or fidelity any of the rights, authorities and powers granted or
available to the Collateral Agent in this Section 10.10 or in any of the
Collateral Documents, it being understood and agreed that in respect of the
Collateral, or any act, omission or event related thereto, the Collateral Agent
may act in any manner it may deem appropriate, in its sole discretion, given the
Collateral Agent's own interest in the Collateral as one of the Lenders and that
the Collateral Agent shall have no duty or liability whatsoever to the Lenders,
except for its gross negligence or willful misconduct.
10.11 Actions with Respect to Defaults. In addition to the
Agent's right to take actions on its own accord as permitted under this Credit
Agreement, the Agent shall take such action with respect to an Event of Default
as shall be directed by the Required
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Lenders; provided, that until the Agent shall have received such directions, the
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Event of Default as it shall deem
advisable and in the best interests of the Lenders.
10.12 Delivery of Information. The Agent shall not be required to
deliver to any Lender originals or copies of any documents, instruments,
notices, communications or other information received by the Agent from the
Borrower, any Subsidiary, the Required Lenders, any Lender or any other Person
under or in connection with this Credit Agreement or any other Credit Document
except (i) as specifically provided in this Credit Agreement or any other Credit
Document and (ii) as specifically requested from time to time in writing by any
Lender with respect to a specific document, instrument, notice or other written
communication received by and in the possession of the Agent at the time of
receipt of such request and then only in accordance with such specific request.
10.13 Co-Syndication Agents. Neither Syndication Agent shall have
any duties or responsibilities hereunder in its capacity as such.
ARTICLE 11.
Miscellaneous
11.1 Submission to Jurisdiction; Waivers. The Borrower hereby
irrevocably and unconditionally:
(a) Submits for itself and its property in any legal action or
proceeding relating to this Credit Agreement and the other Credit
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 located in New York
City, 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) Designates, appoints and empowers CT Corporation as its
designee, appointee and agent to receive, accept and acknowledge for and
on its behalf, and in respect of its property, service of any and all
legal process, summons, notices and documents which may be served in any
such action or proceeding. If for any
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reason such designee, appointee and agent shall cease to be available to
act as such, the Borrower agrees to designate a new designee, appointee
and agent in New York City on the terms and for the purposes of this
provision satisfactory to the Agent under this Credit Agreement and the
other Credit Documents.
(d) 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 Borrower at its address set forth in Section 11.5 or at
such other address of which the Agent shall have been notified pursuant
thereto;
(e) 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;
(f) To the extent permitted by law, waives the right to assert
any setoff, counterclaim or cross-claim in respect of, and all statutes
of limitations which may be relevant to, such action or proceeding
(other than compulsory counterclaims), provided that nothing in this
clause (f) shall preclude a separate action asserting any such claims;
and
(g) Waives due diligence, demand, presentment and protest and any
notices thereof as well as notice of nonpayment.
11.2 Waiver of Jury Trial. THE BORROWER, THE AGENT, THE
SYNDICATION AGENTS, THE ISSUING BANKS AND THE LENDERS EACH HEREBY WAIVE ANY
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF THIS CREDIT
AGREEMENT, THE CREDIT DOCUMENTS OR ANY OTHER AGREEMENTS OR TRANSACTIONS RELATED
HERETO OR THERETO.
11.3 Governing Law. The validity, interpretation and enforcement
of this Credit Agreement shall be governed by the laws of the State of New York.
11.4 Delays: Partial Exercise of Remedies. No delay or omission
of the Agent, any Issuing Bank or the Lenders to exercise any right or remedy
hereunder, whether before or after the happening of any Event of Default, shall
impair any such right or shall operate as a waiver thereof or as a waiver of any
such Event of Default. No single or partial exercise by the Agent, any Issuing
Bank or the Lenders of any right or remedy shall preclude any other or further
exercise thereof, or preclude any other right or remedy.
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11.5 Notices. Except as otherwise provided herein, all notices
and correspondences hereunder shall be in writing and sent by certified or
registered mail, return receipt requested, or by overnight delivery service,
with all charges prepaid, if to the Agent, or any of the Lenders, then to BTCC,
00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx Xxxxxxx, and if to
the Borrower, One Anchor Plaza, 0000 Xxxxxx Xxxxx Xxxxxxx, Xxxxx, Xxxxxxx 00000,
Attention Xxxx X. Xxxxxxxx, Chairman and Chief Executive Officer, or by
facsimile transmission, promptly confirmed in writing sent by first class mail,
if to the Agent, or any of the Lenders, at (000) 000-0000, and if to the
Borrower at (000) 000-0000. All such notices and correspondence shall be deemed
given when received by the party to whom sent.
11.6 Benefit of Agreement. (a) This Credit Agreement shall be
binding upon and inure to the benefit of and be enforceable by the respective
successors and assigns of the parties hereto, provided that the Borrower may not
assign or transfer any of its interests hereunder, without the prior written
consent of the Lenders and provided further that the rights of each Lender to
transfer, assign or grant participations in its rights and/or obligations
hereunder shall be limited as set forth below in this Section 11.6, provided
that nothing in this Section 11.6 shall prevent or prohibit any Lender from
pledging its rights under this Credit Agreement and/or its Revolving Loans
and/or Revolving Notes hereunder to a Federal Reserve Bank in support of
borrowings made by such Lender from such Federal Reserve Bank.
(b) Each Lender shall have the right to transfer, assign or grant
participations in all or any part of its remaining rights and obligations
hereunder on the basis set forth below in this clause (b).
(A) Assignments. Each Lender may assign pursuant to an Assignment
and Assumption Agreement all or a portion of its rights and obligations
hereunder pursuant to this clause (b)(A) to (x) one or more Lenders or
(y) one or more other Eligible Transferees, provided that (i) any such
assignment pursuant to clause (y) above shall be in the aggregate amount
of at least $5,000,000, and (ii) any assignment pursuant to clause (y)
shall require the consents of the Agent and PNC, so long as PNC is an
Issuing Bank, and the Borrower, which consents shall not be unreasonably
withheld. Any assignment to another Lender pursuant to this clause
(b)(A) will become effective upon the payment to the Payments
Administrator by either the assigning or the assignee Lender of a
nonrefundable assignment fee of $5,000 and the recording by the Payments
Administrator of such assignment, and the resultant effects thereof on
the Revolving Loans and Commitments of the assigning Lender and the
assignee Lender, in a register maintained by the Payments Administrator
(the "Register"), the Payments Administrator hereby agreeing to effect
such recordation no later than five Business Days after its receipt of a
written notification by the assigning Lender and the assignee Lender of
the proposed
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assignment. Assignments pursuant to clause (b)(A) (y) will only be
effective if the Payments Administrator shall have received a written
notice in the form of Exhibit M-2 hereto from the assigning Lender and
the assignee and payment of a nonrefundable assignment fee of $5,000 to
the Payments Administrator by either the assigning Lender or the
assignee. No later than five Business Days after its receipt of such
written notice, the Payments Administrator will record such assignment,
and the resultant effects thereof on the Revolving Loans and Commitment
of the assigning Lender, in the Register, at which time such assignment
shall become effective. Notwithstanding the foregoing, the Payments
Administrator shall not be required to, and shall not, record any
assignment in the Register on or after the date on which any proposed
amendment, modification or supplement in respect of this Credit
Agreement has been circulated to the Banks for approval until the
earlier of (x) the effectiveness of such amendment, modification or
supplement in accordance with Section 11.10 or (y) 30 days following the
date on which such proposed amendment, modification or supplement was
circulated to the Lenders. Upon the effectiveness of any assignment
pursuant to clause (b)(A)(y), (x) the assignee will become a "Lender"
for all purposes of this Credit Agreement and the other Credit Documents
with Revolving Loans and a Commitment as so recorded by the Payments
Administrator in the Register, and to the extent of such assignment, the
assigning Lender shall be relieved of its obligations hereunder with
respect to the portion of its Commitment being assigned and (y) if such
assignment occurs after the Closing Date, the Borrower shall issue new
Revolving Notes (in exchange for the Revolving Note or Revolving Notes
of the assigning Lender) to the assigning Lender (to the extent such
Lender's Commitment is not reduced to zero as a result of such
assignment) and to the assignee Lender, in each case to the extent
requested by the assigning Lender or assignee Lender, as the case may
be, to the extent needed to reflect the revised Commitments of such
Lenders. The Payments Administrator will (x) notify each Issuing Bank
with respect to outstanding Letters of Credit within 5 Business Days of
the effectiveness of any assignment hereunder and (y) prepare on the
last Business Day of each calendar quarter during which an assignment
has become effective pursuant to this clause (b)(A) a new Schedule I
giving effect to all such assignments effected during such quarter and
will promptly provide same to the Borrower and each of the Lenders.
(B) Participations. Each Lender may transfer, grant or assign
participations in all or any part of such Lender's interests and
obligations hereunder pursuant to this clause (b)(B) to any Eligible
Transferee, provided that (i) such Lender shall remain a "Lender" for
all purposes of this Credit Agreement and the transferee of such
participation shall not constitute a Lender hereunder and (ii) no
participant under any such participation shall have rights to approve
any amendment to or waiver of this Credit Agreement or any other Credit
Document except to the extent such amendment or waiver would (x) extend
the final scheduled maturity of
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any of the Revolving Loans or the Commitment in which such participant
is participating (it being understood that a waiver of a mandatory
reduction in the Total Commitments or the waiver of the application of
any prepayment to the Revolving Loans shall not constitute the extension
of the final scheduled maturity of any Revolving Loan or Commitment),
(y) reduce the interest rate (other than as a result of waiving the
applicability of any post-default increases in interest rates) or Fees
applicable to any of the Revolving Loans, Commitments or Letters of
Credit or postpone the payment or reduce the amount thereof or (z)
release all or substantially all of the Collateral (except as expressly
provided in the Credit Documents). In the case of any such
participation, the participant shall not have any rights under this
Credit Agreement or any of the other Credit Documents (the participant's
rights against the granting Lender in respect of such participation to
be those set forth in the agreement with such Lender creating such
participation) and all amounts payable by the Borrower hereunder shall
be determined as if such Lender had not sold such participation,
provided that such participant shall be entitled to receive additional
amounts under Sections 2.9, 2.10, 4.5 and 4.10 on the same basis as if
it were a Lender. In addition, each agreement creating any participation
must include an agreement by the participant to be bound by the
provisions of Section 11.7 of this Credit Agreement and such participant
shall have executed a confidentiality agreement in the form of Exhibit N
hereto.
(c) Notwithstanding any other provisions of this Section 11.6, no
transfer or assignment of the interests or obligations of any Lender hereunder
or any grant of participations therein shall be permitted if such transfer,
assignment or grant would require the Borrower to file a registration statement
with the SEC or to qualify the Loans under the "Blue Sky" laws of any State.
(d) If any Lender becomes a Defaulting Lender, or upon the
occurrence of any event giving rise to the operation of Section 2.9, 4.3(c)(ii)
or 4.10 with respect to such Lender (and not other Lenders generally), the
Borrower shall have the right, if no Default or Event of Default then exists, to
replace such Lender (the "Replaced Lender") with one or more Eligible
Transferees (collectively, the "Replacement Lender"), provided that (i) at the
time of any replacement pursuant to this Section 11.6(d), the Replacement Lender
shall enter into one or more Assignment and Assumption Agreements pursuant to
Section 11.6(b)(A) (and with all fees payable pursuant to said Section
11.6(b)(A) to be paid by the Replacement Lender) pursuant to which the
Replacement Lender shall acquire all of the Commitments and outstanding
Revolving Loans of, and participations in Letters of Credit by, the Replaced
Lender and, in connection therewith, shall pay to (x) the Replaced Lender in
respect thereof an amount equal to the sum of (A) an amount equal to the
principal of, and all accrued interest on, all outstanding Revolving Loans of
the Replaced Lender, (B) an amount equal to all drawings under Letters of Credit
that have been funded by (and not reimbursed to) such Replaced Lender, together
with all then unpaid interest
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with respect thereto at such time, (C) an amount equal to the increased costs
incurred by the Borrower and owing to the Replaced Lender pursuant to Sections
2.9 and 4.10 and (D) an amount equal to all accrued, but theretofore unpaid,
Fees owing to the Replaced Lender pursuant to Article 4 and (y) any Issuing Bank
the amount of all unreimbursed drawings under Letters of Credit attributable to
such Replaced Lender and (ii) all obligations of the Borrower owing to the
Replaced Lender (other than those specifically described in clause (i) above in
respect of which the assignment purchase price has been, or is concurrently
being, paid) shall be paid in full by the Borrower to such Replaced Lender
concurrently with such replacement. Upon the execution of the respective
Assignment and Assumption Agreements the payment of amounts referred to in
clauses (i) and (ii) above the Replacement Lender shall become a Lender
hereunder and the Replaced Lender shall cease to constitute a Lender hereunder,
except with respect to indemnification provisions under this Credit Agreement,
which shall survive as to such Replaced Lender.
(e) Each Lender initially party to this Credit Agreement hereby
represents, and each Person that becomes a Lender pursuant to an assignment
permitted by the preceding clause (b)(A) will upon its becoming party to this
Credit Agreement represent, that it is an Eligible Transferee which makes loans
in the ordinary course of its business and that it will make or acquire
Revolving Loans for its own account in the ordinary course of such business,
provided that subject to the preceding clauses (a) through (d), the disposition
of any promissory notes or other evidences of or interests in Indebtedness held
by such Lender shall at all times be within its exclusive control.
11.7 Confidentiality. Each Lender agrees that it will use its
reasonable best efforts not to disclose without the prior consent of the
Borrower (other than to its affiliates, employees, auditors, or counsel, or to
another Lender if the disclosing Lender or such disclosing Lender's holding or
parent company in its sole discretion determines that any such party should have
access to such information) any information with respect to the Borrower or any
of the Borrower's Subsidiaries, which is furnished pursuant to the Credit
Documents and which is designated by the Borrower to the Lenders in writing as
confidential; provided, that any Lender may disclose any such information (a) as
has become generally available to the public, (b) as may be required or
appropriate in any report, statement or testimony submitted to any Governmental
Authority having or claiming to have jurisdiction over such Lender, (c) as may
be required or appropriate in response to any summons or subpoena or in
connection with any litigation, (d) in order to comply with any Requirement of
Law, and (e) to any prospective or actual transferee or participant in
connection with any contemplated transfer or participation of any of the
Revolving Notes or Commitments or any interest therein by such Lender which
prospective transferee or participant shall have agreed in writing to be subject
to the confidentiality provisions of this Section 11.7; provided, however, that
in the case of any disclosure pursuant to the foregoing clauses (c) or (d), such
Lender will use its reasonable efforts to notify the Borrower, to the extent
permitted as advised by counsel, in advance (or, in the case of
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clause (d), promptly thereafter) of such disclosure so as to afford the Borrower
the opportunity to protect the confidentiality of the information proposed to be
so disclosed.
11.8 Indemnification. (a) The Borrower shall and hereby agrees to
indemnify, defend and hold harmless the Agent, each Syndication Agent, each
Issuing Bank and each of the Lenders and their respective directors, officers,
agents and employees (the "Indemnitee") from and against (x) any and all losses,
claims, damages, liabilities, deficiencies, judgments or expenses incurred by
any of them (except to the extent that it is finally judicially determined to
have resulted from their own gross negligence or willful misconduct) arising out
of or by reason of any litigations, investigations, claims or proceedings which
arise out of or are in any way related to (i) this Credit Agreement, the other
Credit Documents or the transactions contemplated thereby, (ii) the issuance of
the Letters of Credit, (iii) the failure of an Issuing Bank to honor a drawing
under any Letter of Credit, as a result of any act or omission, whether rightful
or wrongful, of any present or future de jure or de facto government or
Governmental Authority, (iv) any actual or proposed use by the Borrower of the
proceeds of the Revolving Loans or (v) the Agent's, each Syndication Agent's or
the Lenders' entering into this Credit Agreement, the other Credit Documents or
any other agreements and documents relating hereto, including, without
limitation, amounts paid in any settlement agreed to by the Borrower, court
costs and the reasonable fees and disbursements of counsel incurred in
connection with any such litigation, investigation, claim or proceeding or any
advice rendered in connection with any of the foregoing (whether or not such
lender is a party thereto) and (y) any such losses, claims (including
Environmental Claims), damages, liabilities, deficiencies, judgments, fees and
disbursements (including attorneys' and consultants' fees and disbursements) or
expenses incurred in connection with any removal, remedial or other action taken
by Borrower or any of the Lenders in connection with compliance by Borrower or
any of Borrower's Subsidiaries, or any of their respective properties, with any
Environmental Laws or the actual or alleged presence of Hazardous Materials on
any property of the Borrower.
(b) If and to the extent that the Obligations of the Borrower
under this Section 11.8 are unenforceable for any reason, the Borrower hereby
agrees to make the maximum contribution to the payment and satisfaction of such
Obligations which is permissible under applicable law. The Borrower's
Obligations hereunder shall survive any termination of this Credit Agreement and
the other Credit Documents and the payment in full of the Obligations, and are
in addition to, and not in substitution of, any other of their Obligations set
forth in this Credit Agreement.
(c) In addition, the Borrower shall, upon demand, pay to the
Agent and any Lender all costs and expenses (including the reasonable fees and
disbursements of counsel and other professionals) paid or incurred by the Agent
or such Lender in (i) enforcing or defending its rights under or in respect of
this Credit Agreement, the other Credit
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Documents or any other document or instrument now or hereafter executed and
delivered in connection herewith, (ii) in collecting the Revolving Loans, (iii)
in foreclosing or otherwise collecting upon the Collateral or any part thereof
and (iv) obtaining any legal, accounting or other advice in connection with any
of the foregoing.
11.9 Entire Agreement; Successors and Assigns. This Credit
Agreement and the other Credit Documents constitute the entire agreement among
the Borrower, the Agent and the Lenders, supersedes any prior agreements among
them, and shall bind and benefit the Borrower, the Agent and the Lenders and
their respective successors and permitted assigns.
11.10 Amendment or Waiver Neither this Credit Agreement nor any
other Credit Document nor any terms hereof or thereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or termination is
in writing signed by the Borrower and the Required Lenders, provided that no
such change, waiver, discharge or termination shall, without the consent of each
Lender (other than a Defaulting Lender) affected thereby, (i) extend the final
scheduled maturity of any Revolving Loan or Revolving Note (it being understood
that any waiver of the application of any prepayment or the method of
application of any prepayment to the Revolving Loans or any mandatory reduction
to the Total Commitments shall not constitute an extension of the final maturity
date of such Revolving Loans), or reduce the rate (other than as a result of
waiving the applicability of any post-default increases in interest rates) or
extend the time of payment of interest or Fees thereon, or reduce the amount
thereof, or increase the Commitment of any Lender over the amount thereof then
in effect (it being understood that a waiver of any Default or Event of Default
or of a mandatory reduction in the Total Commitments, or mandatory prepayment,
shall not constitute a change in the terms of any Commitment of any Lender),
(ii) release all or substantially all of the Collateral (except as expressly
provided in the Credit Documents), (iii) amend, modify or waive any provision of
this Section 11.10, (iv) reduce the percentage specified in the definition of
Required Lenders or change the percentage of holders of Commitments or the
aggregate unpaid principal amount of the Revolving Loans which shall be required
for the Lenders for any of them to take action under this Agreement or (v)
consent to the assignment or transfer by the Borrower of any of its rights and
obligations under any Credit Document. No provision of Article 3 or 10 may be
amended without the consent of each Issuing Bank or the Agent, respectively.
11.11 Nonliability of Agent and Lenders. The relationship between
the Borrower and the Borrower's Subsidiaries, on the one hand, and the Lenders
and the Agent and each Syndication Agent, on the other hand, shall be solely
that of debtors and creditors. None of the Agent, the Syndication Agents or any
Lender shall have any fiduciary responsibilities to the Borrower, or any of the
Borrower's Subsidiaries. None of the Agent, the Syndication Agents or any Lender
undertakes any responsibility to the Borrower, or any
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of the Borrower's Subsidiaries to review or inform the Borrower, or any of the
Borrower's Subsidiaries of any matter in connection with any phase of the
business or operations of the Borrower, or any of the Borrower's Subsidiaries.
11.12 Independent Nature of Lenders' Rights. The amounts payable
at any time hereunder to each Lender under such Lender's Revolving Note or Notes
shall be a separate and independent debt.
11.13 Counterparts. This Credit Agreement may be executed in any
number of counterparts and by the different parties hereto in separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument.
11.14 Effectiveness. This Credit Agreement shall become effective
on the date on which all of the parties hereto shall have signed a copy hereof
(whether the same or different copies) and shall have delivered the same to the
Agent pursuant to Section 11.5 or, in the case of the Lenders, shall have given
to the Agent written, telecopied or telex notice (actually received) at such
office that the same has been signed and mailed to it.
11.15 Headings Descriptive. The headings of the several sections
and subsections of this Credit Agreement, and the Table of Contents, are
inserted for convenience only and shall not in any way affect the meaning or
construction of any provision of this Credit Agreement.
11.16 Maximum Rate. Notwithstanding anything to the contrary
contained elsewhere in this Credit Agreement or in any other Credit Document,
the Borrower, the Agent and the Lenders hereby agree that all agreements among
them under this Credit Agreement and the other Credit Documents, whether now
existing or hereafter arising and whether written or oral, are expressly limited
so that in no contingency or event whatsoever shall the amount paid, or agreed
to be paid, to the Agent or any Lender for the use, forbearance, or detention of
the money loaned to the Borrower and evidenced hereby or thereby or for the
performance or payment of any covenant or obligation contained herein or
therein, exceed the Highest Lawful Rate. If due to any circumstance whatsoever,
fulfillment of any provisions of this Credit Agreement or any of the other
Credit Documents at the time performance of such provision shall be due shall
exceed the Highest Lawful Rate, then, automatically, the obligation to be
fulfilled shall be modified or reduced to the extent necessary to limit such
interest to the Highest Lawful Rate, and if from any such circumstance and
Lender should ever receive anything of value deemed interest by applicable law
which would exceed the Highest Lawful Rate, such excessive interest shall be
applied to the reduction of the principal amount then outstanding hereunder or
on account of any other then outstanding Obligations and not to the payment of
interest, or if such excessive interest exceeds the principal unpaid balance
then outstanding hereunder and such other then
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outstanding Obligations, such excess shall be refunded to the Borrower. All sums
paid or agreed to be paid to the Agent or any Lender for the use, forbearance,
or detention of the Obligations and other Indebtedness of the Borrower to the
Agent or any Lender shall, to the extent permitted by applicable law, be
amortized, prorated, allocated and spread throughout the full term of such
Indebtedness until payment in full so that the actual rate of interest on
account of all such Indebtedness does not exceed the Highest Lawful Rate
throughout the entire term of such Indebtedness. The terms and provisions of
this Section 11.16 shall control every other provision of this Credit Agreement
and all agreements among the Borrower, the Agent and the Lenders.
11.17 Right of Setoff. In addition to and not in limitation of
all rights of offset that any Lender or any Issuing Bank may have under
applicable law, each Lender and each Issuing Bank shall, upon the occurrence of
any Event of Default and whether or not such Lender or such Issuing Bank has
made any demand or the Obligations of the Borrower are matured, have the right,
upon prior notice to the Borrower, to appropriate and apply to the payment of
the Obligations of Borrower or any of its Subsidiaries all deposits (general or
special, time or demand, provisional or final) then or thereafter held by and
other Indebtedness or property then or thereafter owing by such Lender or such
Issuing Bank, including, without limitation, any and all amounts in any
Depositary Account, the Concentration Account or the Disbursement Account. Each
Lender or each Issuing Bank exercising such rights shall notify the Agent
thereof and any amount received as a result of the exercise of such rights shall
be reallocated among the Lenders and the Issuing Banks as set forth in Section
2.10 hereof provided, however, that failure of the Borrower to receive such
notice shall not impair any Lender's or Issuing Bank's rights hereunder.
* * *
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IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the date first
above written.
Address:
One Anchor Plaza ANCHOR GLASS ACQUISITION
0000 Xxxxxx Xxxxx Xxxxxxx XXXXXXXXXXX
Xxxxx, Xxxxxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000 By /s/ M. Xxxxxxx Xxxxxxxx, Xx.
Attention: Xxxx X. Xxxxxxxx -----------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Vice President and
Chief Financial Officer
00 Xxxx Xxxxxx BT COMMERCIAL CORPORATION,
3rd Floor Individually, as Agent and as
Xxx Xxxx, Xxx Xxxx 00000 Co-Syndication Agent
Tel: (000) 000-0000
Fax: (000) 000-0000
Attention: Xxxxx Xxxxxxx
By /s/ Xxxx Xxxxxxxx-Keskinyan
-----------------------------
Name: Xxxx Xxxxxxxx-Keskinyan
Title: Managing Director
000 Xxxxxxx Xxxxxx PNC BANK, NATIONAL ASSOCIATION,
Xxxxxxxxxx, XX 00000 as Co-Syndication Agent and
Tel: (000) 000-0000 Issuing Bank
Fax: (000) 000-0000
Attention: Enrico Xxxxx Xxxxx
By /s/ Xxxxxx X. Xxxxx Xxxxx
------------------------------
Name: Xxxxxx X. Xxxxx Xxxxx
Title: Vice President
000 Xxxxxxx Xxxxxx BANKERS TRUST COMPANY,
New York, New York 10006 as Issuing Bank
Tel: (000) 000-0000
Fax: (000) 000-0000
Attention: Xxx Xxxxxx By /s/ Xxxxxxx Xxxxxx
------------------------------
Name: Xxxxxxx Xxxxxx
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Title: Vice President
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