EXHIBIT 10.1
[CONFORMED COPY]
$100,000,000
UNSECURED
REVOLVING CREDIT FACILITY
CREDIT AGREEMENT
by and among
TOO, INC.
and
THE GUARANTORS PARTY HERETO
and
THE LENDERS PARTY HERETO
and
NATIONAL CITY BANK, As Agent
and
FIFTH THIRD BANK LASALLE BANK NATIONAL ASSOCIATION
as Co-Syndication Agent and a Lender as Co-Syndication Agent and a Lender
FLEET NATIONAL BANK THE HUNTINGTON NATIONAL BANK
as Co-Documentation Agent and a Lender as Co-Documentation Agent and a Lender
BANK OF AMERICA, N.A.
Lender
Dated as of April 29, 2003
TABLE OF CONTENTS
Section Page
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ARTICLE I CERTAIN DEFINITIONS ......................................... 1
Section 1.01 Certain Definitions ......................................... 1
Section 1.02 Construction ................................................ 17
Section 1.03 Accounting Principles ....................................... 18
ARTICLE II REVOLVING CREDIT AND SWING LOAN FACILITIES .................. 18
Section 2.01 Revolving Credit Commitments ................................ 18
Section 2.02 Nature of Lenders' Obligations with Respect to Revolving
Credit Loans ................................................ 19
Section 2.03 Utilization Fee ............................................. 19
Section 2.04 Revolving Credit Facility Fee ............................... 19
Section 2.05 Revolving Credit Loan Requests; Swing Loan Requests. ........ 20
Section 2.06 Making Revolving Credit Loans and Swing Loans ............... 20
Section 2.07 Swing Loan Note ............................................. 21
Section 2.08 Use of Proceeds ............................................. 21
Section 2.09 Borrowings to Repay Swing Loans ............................. 21
Section 2.10 Letter of Credit Subfacility ................................ 21
ARTICLE III INTEREST RATES .............................................. 27
Section 3.01 Interest Rate Options ....................................... 27
Section 3.02 Interest Periods ............................................ 28
Section 3.03 Interest After Default ...................................... 28
Section 3.04 LIBOR Unascertainable; Illegality; Increased Costs;
Deposits Not Available ...................................... 29
Section 3.05 Selection of Interest Rate Options .......................... 30
ARTICLE IV PAYMENTS .................................................... 30
Section 4.01 Payments .................................................... 30
Section 4.02 Pro Rata Treatment of Lenders ............................... 30
Section 4.03 Interest Payment Dates ...................................... 31
Section 4.04 Voluntary Prepayments. ...................................... 31
Section 4.05 Mandatory Prepayments. ...................................... 32
Section 4.06 Additional Compensation in Certain Circumstances. ........... 34
Section 4.07 Taxes ....................................................... 35
Section 4.08 Judgment Currency. .......................................... 36
Section 4.09 Notes; Principal Payment of Revolving Credit Loans .......... 36
ARTICLE V REPRESENTATIONS AND WARRANTIES .............................. 36
Section 5.01 Representations and Warranties .............................. 36
Section 5.02 Continuation of Representations ............................. 42
TABLE OF CONTENTS
Section Page
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ARTICLE VI CONDITIONS OF LENDING AND ISSUANCE OF LETTERS OF CREDIT ..... 42
Section 6.01 First Loans and Letters of Credit. On the Initial Loan
Date ........................................................ 42
Section 6.02 Each Additional Loan or Letter of Credit .................... 44
ARTICLE VII COVENANTS ................................................... 45
Section 7.01 Affirmative Covenants ....................................... 45
Section 7.02 Negative Covenants .......................................... 47
Section 7.03 Reporting Requirements ...................................... 52
ARTICLE VIII EVENTS OF DEFAULT ........................................... 56
Section 8.01 Events of Default ........................................... 56
Section 8.02 Consequences of Event of Default ............................ 58
ARTICLE IX THE AGENT ................................................... 60
Section 9.01 Appointment ................................................. 60
Section 9.02 Delegation of Duties ........................................ 60
Section 9.03 Nature of Duties; Independent Credit Investigation .......... 60
Section 9.04 Actions in Discretion of Agent; Instructions From the
Lenders ..................................................... 61
Section 9.05 Reimbursement and Indemnification of Agent by the Borrower .. 61
Section 9.06 Exculpatory Provisions; Limitation of Liability ............. 62
Section 9.07 Reimbursement and Indemnification of Agent by Lenders ....... 62
Section 9.08 Reliance by Agent ........................................... 63
Section 9.09 Notice of Default ........................................... 63
Section 9.10 Notices ..................................................... 63
Section 9.11 Lenders in Their Individual Capacities; Agents in Its
Individual Capacity ......................................... 63
Section 9.12 Holders ..................................................... 64
Section 9.13 Equalization of Lenders ..................................... 64
Section 9.14 Successor Agent ............................................. 64
Section 9.15 Agent's Fee ................................................. 65
Section 9.16 Availability of Funds ....................................... 65
Section 9.17 Calculations ................................................ 65
Section 9.18 Beneficiaries ............................................... 65
Section 9.19 Other Agent Titles .......................................... 65
ARTICLE X MISCELLANEOUS ............................................... 65
Section 10.01 Modifications, Amendments or Waivers ........................ 65
Section 10.02 No Implied Waivers; Cumulative Remedies; Writing Required ... 66
Section 10.03 Reimbursement and Indemnification of Lenders by the
Borrower; Taxes ............................................. 66
Section 10.04 Holidays .................................................... 67
Section 10.05 Funding by Branch, Subsidiary or Affiliate .................. 68
Section 10.06 Notices ..................................................... 68
Section 10.07 Severability. ............................................... 69
Section 10.08 Governing Law ............................................... 69
TABLE OF CONTENTS
Section Page
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Section 10.09 Prior Understanding ......................................... 69
Section 10.10 Duration; Survival .......................................... 69
Section 10.11 Assignments, Participations, Successors and Assigns ......... 70
Section 10.12 Confidentiality ............................................. 71
Section 10.13 Counterparts ................................................ 71
Section 10.14 Agent's or Lender's Consent ................................. 71
Section 10.15 Exceptions .................................................. 71
Section 10.16 CONSENT TO FORUM; WAIVER OF JURY TRIAL ...................... 72
Section 10.17 Tax Withholding Clause ...................................... 72
Section 10.18 Joinder of Guarantors ....................................... 73
LIST OF SCHEDULES AND EXHIBITS
SCHEDULES
SCHEDULE 1.01(A) - PRICING GRID
SCHEDULE 1.01(B) - COMMITMENTS OF LENDERS AND ADDRESSES FOR NOTICES
SCHEDULE 1.01(P) - PERMITTED LIENS
SCHEDULE 2.10 - LETTERS OF CREDIT
SCHEDULE 5.01(B)(I) - SUBSIDIARIES
SCHEDULE 5.01(B)(II) - INVENTORY LOCATIONS
SCHEDULE 5.01(L) - CONSENTS AND APPROVALS
SCHEDULE 7.02(A) - PERMITTED INDEBTEDNESS
SCHEDULE 7.02(D) - INVESTMENT POLICY
SCHEDULE 7.03(B) - ACCOUNTING FIRMS
EXHIBITS
EXHIBIT 1.01(A) - ASSIGNMENT AND ASSUMPTION AGREEMENT
EXHIBIT 1.01(G)(1) - GUARANTOR JOINDER
EXHIBIT 1.01(G)(2) - GUARANTY AGREEMENT
EXHIBIT 1.01(R) - REVOLVING CREDIT NOTE
EXHIBIT 1.01(S)(1) - SECURITY AGREEMENT
EXHIBIT 1.01(S)(2) - SWING LOAN NOTE
EXHIBIT 2.05(A) - LOAN REQUEST
EXHIBIT 2.05(B) - SWING LOAN REQUEST
EXHIBIT 4.04(D) - COMMITMENT REDUCTION NOTICE
EXHIBIT 6.01(D) - OPINION OF COUNSEL
EXHIBIT 7.02(E) - ACQUISITION COMPLIANCE CERTIFICATE
EXHIBIT 7.03(C) - QUARTERLY COMPLIANCE CERTIFICATE
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT is dated as of April 29, 2003 and is made BY and
among TOO, INC., a Delaware corporation (the "Borrower"), each of the Guarantors
(as hereinafter defined), the LENDERS (as hereinafter defined), and NATIONAL
CITY BANK, in its capacity as sole lead arranger and administrative agent for
the Lenders under this Agreement (hereinafter referred to in such capacity as
the "Agent"), FIFTH THIRD BANK, as co-syndication agent, LASALLE BANK NATIONAL
ASSOCIATION, as co-syndication agent, FLEET NATIONAL BANK, as co-documentation
agent, and THE HUNTINGTON NATIONAL BANK, as co-documentation agent.
WITNESSETH:
WHEREAS, the Borrower has requested the Lenders to provide a revolving
credit facility for an initial term of three (3) years to the Borrower in an
aggregate principal amount not to exceed $100,000,000; and
WHEREAS, the revolving credit facility shall be used for (i) ongoing
working capital and letters of credit, (ii) capital expenditures, and (iii)
general corporate purposes; and
WHEREAS, the Lenders are willing to provide such credit upon the
terms and conditions hereinafter set forth;
NOW, THEREFORE, the parties hereto, in consideration of their mutual
covenants and agreements hereinafter set forth and intending to be legally bound
hereby, covenant and agree as follows:
ARTICLE I CERTAIN DEFINITIONS
Section 1.01 Certain Definitions. In addition to words and terms defined
elsewhere in this Agreement, the following words and terms shall have the
following meanings, respectively, unless the context hereof clearly requires
otherwise:
AFFILIATE as to any Person shall mean any other Person (i) which directly
or indirectly controls, is controlled by, or is under common control with such
Person, (ii) which beneficially owns or holds 10% or more of any class of the
voting or other equity interests of such Person, or (iii) 10% or more of any
class of voting interests or other equity interests of which is beneficially
owned or held, directly or indirectly, by such Person. Control, as used in this
definition, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract or otherwise, including
the power to elect a majority of the directors or trustees of a corporation or
trust, as the case may be.
AGENT shall mean National City Bank, and its successors and assigns.
AGENT'S FEE shall have the meaning assigned to that term in Section 9.15.
AGENT'S LETTER shall have the meaning assigned to that term in Section
9.15.
AGREEMENT shall mean this Credit Agreement, as the same may be
supplemented or amended from time to time, including all schedules and exhibits.
ANCILLARY SECURITY DOCUMENTS shall mean all documents, instruments,
agreement, endorsement, policy, and certificates customarily obtained, executed
or delivered by or for any Loan Party or Agent in connection with any Security
Document. Without limiting the generality of the foregoing, examples of
Ancillary Security Documents would include insurance policies or certificates
regarding any collateral, title insurance policies, appraisals, lien searches,
estoppel letters, flood insurance certifications, opinions of counsel, and the
like.
APPLICABLE FACILITY FEE RATE shall mean the percentage rate per annum, at
the corresponding Leverage Ratio Level in the pricing grid on Schedule 1.01(A),
set forth below the heading "Facility Fee" thereon.
APPLICABLE MARGIN shall mean, as applicable:
(A) the percentage spread, to be added to Base Rate under the Base Rate
Option at the corresponding Leverage Ratio Level in the pricing grid on Schedule
1.01(A), set forth below the heading "Base Rate Spread" thereon, or
(B) the percentage spread, to be added to LIBO-Rate under the LIBOR Option
at the corresponding Leverage Ratio Level in the pricing grid on Schedule
1.01(A), set forth below the heading "LIBO-Rate Spread" thereon.
APPLICABLE UTILIZATION FEE RATE shall mean the percentage rate per annum,
at the corresponding Leverage Ratio Level in the pricing grid on Schedule
1.01(A), set forth below the heading "Utilization Fee" thereon.
ASSIGNMENT AND ASSUMPTION AGREEMENT shall mean an Assignment and
Assumption Agreement by and among a Purchasing Lender, a Transferor Lender and
the Agent, as Agent and on behalf of the remaining Lenders, substantially in the
form of Exhibit 1.01(A).
AUTHORIZED OFFICER shall mean those individuals, designated by written
notice to the Agent from the Borrower, authorized to execute notices, reports
and other documents on behalf of the Loan Parties required hereunder. The
Borrower may amend such list of individuals from time to time by giving written
notice of such amendment to the Agent.
BASE NET WORTH shall mean the sum of $228,294,000 plus 50% of consolidated
net income of the Borrower and its Subsidiaries for each fiscal quarter in which
net income was earned (as opposed to a net loss) during the period from February
1, 2003, through the date of determination.
BASE RATE shall mean the greater of (i) the interest rate per annum
announced from time to time by the Agent at its Principal Office as its then
prime rate, which rate may not be the lowest rate then being charged commercial
borrowers by the Agent, or (ii) the Federal Funds Effective Rate plus 0.5% per
annum.
BASE RATE OPTION shall mean the option of the Borrower to have Revolving
Credit Loans bear interest at the rate and under the terms and conditions set
forth in Section 3.01(a).
BENEFIT ARRANGEMENT shall mean at any time an "employee benefit plan,"
within the meaning of Section 3(3) of ERISA, which is neither a Plan nor a
Multiemployer Plan and which is maintained, sponsored or otherwise contributed
to by any member of the ERISA Group.
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BORROWER shall mean Too, Inc., a corporation organized and existing
under the laws of the State of Delaware.
BORROWING DATE shall mean, with respect to any Loan, the date for the
making thereof or the renewal or conversion thereof at or to the same or a
different Interest Rate Option, which shall be a Business Day.
BORROWING TRANCHE shall mean specified portions of Loans outstanding as
follows: (i) any Loans to which the LIBOR Option applies which become subject to
the same Interest Rate Option under the same Loan Request by the Borrower and
which have the same Interest Period shall constitute one Borrowing Tranche, and
(ii) all Loans to which the Base Rate Option applies shall constitute one
Borrowing Tranche.
BUSINESS DAY shall mean any day other than a Saturday or Sunday or a legal
holiday on which commercial banks are authorized or required to be closed for
business in Cleveland, Ohio and if the applicable Business Day relates to any
Loan to which the LIBOR Option applies, such day must also be a day on which
dealings are carried on in the London interbank market.
CLOSING DATE shall mean April 29, 2003.
COMMITMENT shall mean as to any Lender its Revolving Credit Commitment,
and Commitments shall mean the aggregate of the Revolving Credit Commitments of
all of the Lenders.
COMPLIANCE CERTIFICATE shall have the meaning assigned to such term in
Section 7.03(c).
CONSIDERATION shall mean with respect to any Permitted Acquisition, the
aggregate of (i) the cash paid by any of the Loan Parties, directly or
indirectly, to the seller in connection therewith, (ii) the Indebtedness
incurred or assumed by any of the Loan Parties, whether in favor of the seller
or otherwise and whether fixed or contingent, (iii) any Guaranty given or
incurred by any Loan Party in connection therewith, and (iv) any other
consideration given or obligation incurred by any of the Loan Parties in
connection therewith.
CONSOLIDATED EBITDAR shall mean, for any period of determination,
consolidated net income for such period plus, without duplication and to the
extent deducted in determining such consolidated net income, the sum of
Consolidated Interest Expense, income tax expense, depreciation expense,
amortization expense, Consolidated Minimum Rent and other non-cash charges, and
minus consolidated interest income and non-cash credits, in each case of the
Borrower and its Subsidiaries for such period determined and consolidated in
accordance with GAAP.
CONSOLIDATED INTEREST EXPENSE shall mean as of any period of determination
the aggregate interest expense of the Borrower and its Subsidiaries for such
period determined and consolidated in accordance with GAAP.
CONSOLIDATED MINIMUM RENT shall mean, for any period of determination,
total rent expense (but adding also any payments of contingent rent on those
retail locations the lease of which is guarantied by Limited Brands, Inc., or an
Affiliate thereof) less contingent store rent on those retail locations the
lease of which is not guarantied by Limited Brands, Inc., or an Affiliate
thereof, in each case of the Borrower and its Subsidiaries for such period
determined and consolidated in accordance with GAAP.
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CONSOLIDATED TANGIBLE NET WORTH shall mean as of any date of determination
total stockholders' equity less intangible assets of the Borrower and its
Subsidiaries as of such date determined and consolidated in accordance with
GAAP.
CONSOLIDATED TOTAL DEBT shall mean for any time or period of determination
the sum of all Indebtedness, excluding documentary letters of credit, plus six
(6) times the Forward Minimum Rent Commitments, in each case of the Borrower and
its Subsidiaries for such period or time determined and consolidated in
accordance with GAAP.
CONTAMINATION shall mean the presence or release or threat of release of
Regulated Substances in, on, under or migrating to or from the Property, which
pursuant to Environmental Laws requires notification or reporting to an Official
Body, or which pursuant to Environmental Laws requires the performance of a
Remedial Action or which otherwise constitutes a violation of Environmental
Laws.
COVERAGE RATIO shall mean the ratio of (a) Consolidated EBITDAR for the
period of four (4) consecutive fiscal quarters then ended to (b) the sum of (x)
Consolidated Interest Expense for such period and (y) Consolidated Minimum Rent
for such period.
DOLLAR, DOLLARS, U.S. DOLLARS and the symbol $ shall mean lawful
money of the United States of America.
DOCUMENTARY LETTER OF CREDIT shall mean any letter of credit which is a
documentary letter of credit issued in respect of the purchase of goods or
services by one or more of the Loan Parties in the ordinary course of their
business.
DOCUMENTARY LETTER OF CREDIT RATE shall mean one-half of the Applicable
Margin under the LIBOR Option.
DRAWING DATE shall have the meaning assigned to that term in Section
2.10(c)(ii).
ENVIRONMENTAL COMPLAINT shall mean any (i) notice of non-compliance or
violation, citation or order relating in any way to any Environmental Law,
Environmental Permit, Contamination or Regulated Substance; (ii) civil,
criminal, administrative or regulatory investigation instituted by an Official
Body relating in any way to any Environmental Law, Environmental Permit,
Contamination or Regulated Substance; (iii) administrative, regulatory or
judicial action, suit, claim or proceeding instituted by any Person or Official
Body or any written notice of liability or potential liability from any Person
or Official Body, in either instance, setting forth allegations relating to or a
cause of action for personal injury (including but not limited to death),
property damage, natural resource damage, contribution or indemnity for the
costs associated with the performance of Remedial Actions, direct recovery for
the costs associated with the performance of Remedial Actions, liens or
encumbrances attached to or recorded or levied against property for the costs
associated with the performance of Remedial Actions, civil or administrative
penalties, criminal fines or penalties, or declaratory or equitable relief
arising under any Environmental Laws; or (iv) subpoena, request for information
or other written notice or demand of any type issued by an Official Body
pursuant to any Environmental Laws.
ENVIRONMENTAL LAWS shall mean all federal, territorial, tribal, state,
local and foreign Laws (including, but not limited to, the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C. Sections 9601
et seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et
seq., the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801 et
seq., the Toxic Substances Control Act,
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15 U.S.C. Section 2601 et seq., the Federal Water Pollution Control Act, 33
U.S.C. Sections 1251 et seq., the Federal Safe Drinking Water Act, 42 U.S.C.
Sections 300f-300j, the Federal Air Pollution Control Act, 42 U.S.C. Section
7401 et seq., the Oil Pollution Act, 33 U.S.C. Section 2701 et seq., the Federal
Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. Sections 136 to 136y, each
as amended, and any regulations promulgated thereunder or any equivalent state
or local Law, each as amended, and any regulations promulgated thereunder) and
any consent decrees, settlement agreements, judgments, orders, directives,
policies or programs issued by or entered into with an Official Body pertaining
or relating to: (i) pollution or pollution control; (ii) protection of human
health from exposure to Regulated Substances (iii) protection of the environment
and/or natural resources; (iv) the presence, use, management, generation,
manufacture, processing, extraction, treatment, recycling, refining,
reclamation, labeling, sale, transport, storage, collection, distribution,
disposal or release or threat of release of Regulated Substances; (v) the
presence of Contamination; (vi) the protection of endangered or threatened
species; and (vii) the protection of Environmentally Sensitive Areas.
ENVIRONMENTAL PERMITS shall mean all permits, licenses, bonds or other
forms of financial assurances, consents, registrations, identification numbers,
approvals or authorizations required under Environmental Laws (i) to own, occupy
or maintain the Property; (ii) for the operations and business activities of the
Loan Parties or any Subsidiaries of any Loan Party; or (iii) for the performance
of a Remedial Action.
ENVIRONMENTAL RECORDS shall mean all notices, reports, records, plans,
applications, forms or other filings relating or pertaining to the Property,
Contamination, the performance of a Remedial Action and the operations and
business activities of the Loan Parties or any Subsidiaries of any Loan Party
which pursuant to Environmental Laws, Required Environmental Permits or at the
request or direction of an Official Body either must be submitted to an Official
Body or which otherwise must be maintained.
ENVIRONMENTALLY SENSITIVE AREA shall mean (i) any wetland as defined by
applicable Environmental Laws; (ii) any area designated as a coastal zone
pursuant to applicable Laws, including Environmental Laws; (iii) any area of
historic or archeological significance or scenic area as defined or designated
by applicable Laws, including Environmental Laws; (iv) habitats of endangered
species or threatened species as designated by applicable Laws, including
Environmental Laws; (v) wilderness or refuge areas as defined or designated by
applicable Laws, including Environmental Laws; or (vi) a floodplain or other
flood hazard area as defined pursuant to any applicable Laws.
ERISA shall mean the Employee Retirement Income Security Act of 1974, as
the same may be amended or supplemented from time to time, and any successor
statute of similar import, and the rules and regulations thereunder, as from
time to time in effect.
ERISA GROUP shall mean, at any time, the Borrower and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control and all other entities which, together with
the Borrower, are treated as a single employer under Section 414 of the Internal
Revenue Code.
EVENT OF DEFAULT shall mean any of the events described in Section 8.01
and referred to therein as an "Event of Default."
EXPIRATION DATE shall mean, with respect to the Revolving Credit
Commitments and otherwise, the third anniversary of the Closing Date.
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FACILITY FEES shall mean the fees referred to in Section 2.04.
FEDERAL FUNDS EFFECTIVE RATE for any day shall mean the rate per annum
(based on a year of 360 days and actual days elapsed and rounded upward to the
nearest 1/100 of 1%) announced by the Federal Reserve Bank of New York (or any
successor) on such day as being the weighted average of the rates on overnight
federal funds transactions arranged by federal funds brokers on the previous
trading day, as computed and announced by such Federal Reserve Bank (or any
successor) in substantially the same manner as such Federal Reserve Bank
computes and announces the weighted average it refers to as the "Federal Funds
Effective Rate" as of the date of this Agreement; provided, if such Federal
Reserve Bank (or its successor) does not announce such rate on any day, the
"Federal Funds Effective Rate" for such day shall be the Federal Funds Effective
Rate for the last day on which such rate was announced.
FINANCIAL PROJECTIONS shall have the meaning assigned to that term in
Section 5.01(h)(ii).
FORWARD MINIMUM RENT COMMITMENTS means minimum rent commitments (less
related sublease income) in the aggregate of the Loan Parties (and all of their
respective Subsidiaries which are not Loan Parties) under noncancelable leases
(including under any such leases of any Person other than a Loan Party or a
Subsidiary of a Loan Party to the extent, directly or indirectly guaranteed,
endorsed or assumed by a Loan Party or a Subsidiary of a Loan Party or in
respect of which a Loan Party or a Subsidiary of a Loan Party is contingently or
otherwise liable) for the fiscal year following the Borrower's most recently
ended fiscal year, as reported or to be reported in the Borrower's annual report
filed on Form 10-K with the Securities and Exchange Commission for the
Borrower's most recently ended fiscal year.
GAAP shall mean generally accepted accounting principles as are in effect
from time to time, subject to the provisions of Section 1.03, and applied on a
consistent basis both as to classification of items and amounts.
GOVERNMENTAL ACTS shall have the meaning assigned to that term in Section
2.10(g).
GUARANTOR shall mean each of the parties to this Agreement which is
designated as a "Guarantor" on the signature page hereof and each other Person
which joins this Agreement as a Guarantor after the date hereof pursuant to
Section 10.18 and shall include each Subsidiary of the Borrower now or hereafter
organized or existing under the laws of the United States or any state thereof.
GUARANTOR JOINDER shall mean a joinder by a Person as a Guarantor under
this Agreement, the Guaranty Agreement and the other Loan Documents in the form
of Exhibit 1.01(G)(1).
GUARANTY of any Person shall mean any obligation of such Person
guaranteeing or in effect guaranteeing any liability or obligation of any other
Person in any manner, whether directly or indirectly, including any agreement to
indemnify or hold harmless any other Person, any performance bond or other
suretyship arrangement and any other form of assurance against loss, except
endorsement of negotiable or other instruments for deposit or collection in the
ordinary course of business.
GUARANTY AGREEMENT shall mean the Guaranty and Suretyship Agreement in
substantially the form of Exhibit 1.01(G)(2) executed and delivered by each of
the Guarantors to the Agent for the benefit of the Lenders.
HISTORICAL STATEMENTS shall have the meaning assigned to that term in
Section 5.01(h)(i).
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INDEBTEDNESS shall mean, as to any Person at any time, any and all
indebtedness, obligations or liabilities (whether matured or unmatured,
liquidated or unliquidated, direct or indirect, absolute or contingent, or joint
or several) of such Person for or in respect of: (i) borrowed money, (ii)
amounts raised under or liabilities in respect of any note purchase or
acceptance credit facility, liabilities in respect of Off-Balance Sheet
Transactions, (iii) reimbursement obligations (contingent or otherwise) under
any letter of credit, currency swap agreement, interest rate swap, cap, collar
or floor agreement or other interest rate management device, (iv) any other
transaction (including forward sale or purchase agreements, capitalized leases
and conditional sales agreements) having the commercial effect of a borrowing of
money entered into by such Person to finance its operations or capital
requirements (but not including trade payables and accrued expenses incurred in
the ordinary course of business which are not represented by a promissory note
or other evidence of indebtedness and which are not more than thirty (30) days
past due), or (v) any Guaranty of Indebtedness for borrowed money.
INITIAL LOAN DATE shall mean the Business Day on which the first Loan
shall be made.
INELIGIBLE SECURITY shall mean any security which may not be underwritten
or dealt in by member banks of the Federal Reserve System under Section 16 of
the Banking Act of 1933 (12 U.S.C. Section 24, Seventh), as amended.
INSOLVENCY PROCEEDING shall mean, with respect to any Person, (a) a case,
action or proceeding with respect to such Person (i) before any court or any
other Official Body under any bankruptcy, insolvency, reorganization or other
similar Law now or hereafter in effect, or (ii) for the appointment of a
receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator
(or similar official) of any Loan Party or otherwise relating to the
liquidation, dissolution, winding-up or relief of such Person, or (b) any
general assignment for the benefit of creditors, composition, marshaling of
assets for creditors, or other, similar arrangement in respect of such Person's
creditors generally or any substantial portion of its creditors; undertaken
under any Law.
INTEREST PERIOD shall mean the period of time selected by the Borrower in
connection with (and to apply to) any election permitted hereunder by the
Borrower to have Revolving Credit Loans bear interest under the LIBOR Option.
Subject to the last sentence of this definition, such period shall be one, two,
three or six Months. Such Interest Period shall commence on the effective date
of such Interest Rate Option, which shall be (i) the Borrowing Date if the
Borrower is requesting new Loans, or (ii) the date of renewal of or conversion
to the LIBOR Option if the Borrower is renewing or converting to the LIBOR
Option applicable to outstanding Loans. Notwithstanding the second sentence
hereof: (A) any Interest Period which would otherwise end on a date which is not
a Business Day shall be extended to the next succeeding Business Day unless such
Business Day falls in the next calendar month, in which case such Interest
Period shall end on the next preceding Business Day, and (B) the Borrower shall
not select, convert to or renew an Interest Period for any portion of the Loans
that would end after the Expiration Date.
INTEREST RATE HEDGE shall mean an interest rate exchange, collar, cap,
swap, adjustable strike cap, adjustable strike corridor or similar agreements
entered into by the Loan Parties or their Subsidiaries in order to provide
protection to, or minimize the impact upon, the Borrower, the Guarantor and/or
their Subsidiaries of increasing floating rates of interest applicable to
Indebtedness.
INTEREST RATE OPTION shall mean any LIBOR Option or Base Rate Option.
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INTERNAL REVENUE CODE shall mean the Internal Revenue Code of 1986, as the
same may be amended or supplemented from time to time, and any successor statute
of similar import, and the rules and regulations thereunder, as from time to
time in effect.
ISSUING BANK shall mean, with respect to a Letter of Credit, including any
replacements therefor or extensions thereof, National City Bank, Huntington
National Bank, and any other Lender which shall have consented to its
designation by the Borrower as an "Issuing Bank" by providing prior written
notice of such designation and consent to the Agent, and any of their respective
Affiliates.
LABOR CONTRACTS shall mean all employment agreements, employment
contracts, collective bargaining agreements and other agreements among any Loan
Party or Subsidiary of a Loan Party and its employees.
LAW shall mean any law (including common law), constitution, statute,
treaty, regulation, rule, ordinance, opinion, release, ruling, order,
injunction, writ, decree, bond, judgment, authorization or approval, lien or
award of or settlement agreement with any Official Body.
LENDER-PROVIDED INTEREST RATE HEDGE shall mean an Interest Rate Hedge
which is provided by any Lender and with respect to which the Agent confirms
meets the following requirements: such Interest Rate Hedge (i) is documented in
a standard International Swap Dealer Association Agreement, (ii) provides for
the method of calculating the reimbursable amount of the provider's credit
exposure in a reasonable and customary manner, and (iii) is entered into for
hedging (rather than speculative) purposes. The liabilities of the Loan Parties
to the provider of any Lender-Provided Interest Rate Hedge (the "Hedge
Liabilities") shall be "Obligations" hereunder, guaranteed obligations under the
Guaranty Agreement and secured obligations under the Security Documents and
otherwise treated as Obligations for purposes of each of the other Loan
Documents. The Liens securing the Hedge Liabilities shall be pari passu with the
Liens securing all other Obligations under this Agreement and the other Loan
Documents.
LENDERS shall mean the financial institutions named on Schedule 1.01(B)
and their respective successors and assigns as permitted hereunder, each of
which is referred to herein as a Lender.
LETTER OF CREDIT shall have the meaning assigned to that term in Section
2.10(a).
LETTER OF CREDIT BORROWING shall have the meaning assigned to such term in
Section 2.10(c)(iv).
LETTER OF CREDIT FEE shall have the meaning assigned to that term in
Section 2.10(b).
LETTERS OF CREDIT OUTSTANDING shall mean at any time the sum of (i) the
aggregate undrawn face amount of outstanding Letters of Credit and (ii) the
aggregate amount of all unpaid and outstanding Reimbursement Obligations and
Letter of Credit Borrowings.
LEVERAGE RATIO shall mean the ratio of (a) Consolidated Total Debt as of
the end of the most recently ended fiscal quarter to (b) Consolidated EBITDAR
for the period of four (4) consecutive fiscal quarters then ended.
LEVERAGE RATIO LEVEL shall mean on any date of determination a numerical
level of either I, II, III, or IV based on the Leverage Ratio of the Borrower on
such date as follows:
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Leverage Ratio Leverage Ratio Level
-------------- --------------------
less than 1.75 I
greater than or equal to 1.75 but less than 2.25 II
greater than or equal to 2.25 but less than 2.75 III
greater than or equal to 2.75 IV
The Leverage Ratio Level shall initially be Level II for the period commencing
on the Closing Date to the due date for delivery of the Compliance Certificate
for the fiscal quarter ending on or about April 30, 2003. On and after the due
date for such delivery, the Leverage Ratio Level shall be computed as of the end
of each fiscal quarter (beginning with the fiscal quarter ending on or about
June 30, 2003) based on the Compliance Certificate for such quarter. Any
increase or decrease in the Leverage Ratio Level after the Closing Date shall be
effective on the first calendar day following the date on which the Compliance
Certificate evidencing the computation of such Leverage Ratio Level is due to be
delivered under Section 7.03(c).
LIBO-RATE shall with respect to the Loans comprising any Borrowing Tranche
to which the LIBOR Option applies for any Interest Period, the interest rate per
annum determined by the Agent by dividing (the resulting quotient rounded
upwards, if necessary, to the nearest 1/100th of 1% per annum) (i) the rate of
interest determined by the Agent in accordance with its usual procedures (which
determination shall be conclusive absent manifest error) to be the average of
the London interbank offered rates for U.S. Dollars quoted by the British
Bankers' Association as set forth on Dow Xxxxx Markets Service (formerly known
as Telerate) (or appropriate successor or, if the British Bankers' Association
or its successor ceases to provide such quotes, a comparable replacement
determined by the Agent) display page 3750 (or such other display page on the
Dow Xxxxx Markets Service system as may replace display page 3750) two (2)
Business Days prior to the first day of such Interest Period for an amount
comparable to such Borrowing Tranche and having a borrowing date and a maturity
comparable to such Interest Period by (ii) a number equal to 1.00 minus the
LIBOR Reserve Percentage. The LIBO-Rate may also be expressed by the following
formula:
LIBO-Rate = Average of London interbank offered rates quoted
by BBA or appropriate successor as shown on
Dow Xxxxx Markets Service display page 3750
-------------------------------------------
1.00 - LIBOR Reserve Percentage
The LIBO-Rate shall be adjusted with respect to any Loan to which the LIBOR
Option applies that is outstanding on the effective date of any change in the
LIBOR Reserve Percentage as of such effective date. The Agent shall give prompt
notice to the Borrower of the LIBO-Rate as determined or adjusted in accordance
herewith, which determination shall be conclusive absent manifest error.
LIBOR OPTION shall mean the option of the Borrower to have Revolving
Credit Loans bear interest at the rate and under the terms and conditions set
forth in Section 3.01(a)(ii).
LIBOR RESERVE PERCENTAGE shall mean as of any day the maximum percentage
in effect on such day, as prescribed by the Board of Governors of the Federal
Reserve System (or any successor) for
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determining the reserve requirements (including supplemental, marginal and
emergency reserve requirements) with respect to eurocurrency funding (currently
referred to as "Eurocurrency Liabilities").
LIEN shall mean any mortgage, deed of trust, pledge, lien, security
interest, charge or other encumbrance or security arrangement of any nature
whatsoever, whether voluntarily or involuntarily given, including any
conditional sale or title retention arrangement, and any assignment, deposit
arrangement or lease intended as, or having the effect of, security and any
filed financing statement or other notice of any of the foregoing (whether or
not a lien or other encumbrance is created or exists at the time of the filing).
LLC INTERESTS shall have the meaning given to such term in Section
5.01(b).
LOAN DOCUMENTS shall mean this Agreement, the Agent's Letter, the Guaranty
Agreement, and any other instruments, certificates or documents delivered or
contemplated to be delivered hereunder or thereunder or in connection herewith
or therewith, as the same may be supplemented or amended from time to time in
accordance herewith or therewith, and Loan Document shall mean any of the Loan
Documents; provided, however, that the Security Documents shall not be included
among the Loan Documents until the occurrence and continuation of an Event of
Default, as set forth at Section 6.01(c) and Section 7.01(k).
LOAN PARTIES shall mean the Borrower and the Guarantors.
LOAN REQUEST shall have the meaning given to such term in Section 2.05(a).
LOANS shall mean collectively and Loan shall mean separately all Revolving
Credit Loans and Swing Loans or any Revolving Credit Loan or Swing Loan.
MATERIAL ADVERSE CHANGE shall mean any set of circumstances or events
which (a) has or could reasonably be expected to have any material adverse
effect upon the validity or enforceability of this Agreement or any other Loan
Document, (b) is or could reasonably be expected to be material and adverse to
the business, properties, assets, financial condition, results of operations or
prospects of the Loan Parties taken as a whole, (c) impairs materially or could
reasonably be expected to impair materially the ability of the Loan Parties
taken as a whole to duly and punctually pay or perform its Indebtedness, or (d)
impairs materially or could reasonably be expected to impair materially the
ability of the Agent or any of the Lenders, to the extent permitted, to enforce
their legal remedies pursuant to this Agreement or any other Loan Document.
MONTH, with respect to an Interest Period under the LIBOR Option, shall
mean the interval between the days in consecutive calendar months numerically
corresponding to the first day of such Interest Period. If any LIBOR Interest
Period begins on a day of a calendar month for which there is no numerically
corresponding day in the month in which such Interest Period is to end, the
final month of such Interest Period shall be deemed to end on the last Business
Day of such final month.
MOODY'S shall mean Xxxxx'x Investors Service, Inc. and its
successors.
MULTIEMPLOYER PLAN shall mean any employee benefit plan which is a
"multiemployer plan" within the meaning of Section 4001(a)(3) of ERISA and to
which the Borrower or any member of the ERISA Group is then making or accruing
an obligation to make contributions or, within the preceding five Plan years,
has made or had an obligation to make such contributions.
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MULTIPLE EMPLOYER PLAN shall mean a Plan which has two or more
contributing sponsors (including the Borrower or any member of the ERISA Group)
at least two of whom are not under common control, as such a plan is described
in Sections 4063 and 4064 of ERISA.
NATIONAL CITY BANK shall mean National City Bank, a national banking
association, and its successors and assigns.
NOTES shall mean the Revolving Credit Notes and the Swing Note, if any.
NOTICES shall have the meaning assigned to that term in Section 10.06.
OBLIGATION shall mean any obligation or liability of any of the Loan
Parties to the Agent or any of the Lenders, howsoever created, arising or
evidenced, whether direct or indirect, absolute or contingent, now or hereafter
existing, or due or to become due, under or in connection with this Agreement,
any Notes, the Letters of Credit, the Agent's Letter or any other Loan Document.
Obligations shall include the liabilities to any Lender under any
Lender-Provided Interest Rate Hedge but shall not include the liabilities to
other Persons under any other Interest Rate Hedge.
OFFERED RATE OPTION shall mean the rate of interest quoted from time to
time by the Agent to the Borrower and accepted by the Borrower with respect to a
Swing Loan.
OFF-BALANCE SHEET TRANSACTION shall mean, as to any Person at any time,
any transaction the liabilities in respect of which do not appear on the
liability side of a balance sheet, or any transaction utilizing a special
purpose entity, conduit, or similar vehicle, in any case constituting the
functional equivalent of borrowed money or otherwise providing for a material
liability of such Person (including without limitation asset or other
securitizations, Sale-Leasebacks, synthetic leases and the like, but excluding
operating leases arising in the ordinary course of business).
OFFSHORE SUBSIDIARY shall mean a Subsidiary of a Loan Party, which
Subsidiary is organized under the laws of any jurisdiction other than the United
States or a state thereof and which Subsidiary is engaged in the purchase of
goods outside of the United States for the sale of such goods to a Loan Party
for resale by a Loan Party at its retail locations.
OFFICIAL BODY shall mean any national, federal, state, local or other
government or political subdivision or any agency, authority, board, bureau,
central bank, commission, department or instrumentality of either, or any court,
tribunal, grand jury or arbitrator, in each case whether foreign or domestic.
PARTICIPATION ADVANCE shall mean, with respect to any Lender, such
Lender's payment in respect of its participation in a Letter of Credit Borrowing
according to its Ratable Share pursuant to Section 2.10(d).
PARTNERSHIP INTERESTS shall have the meaning given to such term in Section
5.01(b).
PBGC shall mean the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA or any successor.
PERMITTED ACQUISITIONS shall have the meaning assigned to such term in
Section 7.02(e).
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PERMITTED LIENS shall mean:
(i) Liens for taxes, assessments, or similar charges, incurred in
the ordinary course of business and which are not yet due and payable;
(ii) Pledges or deposits made in the ordinary course of business to
secure payment of workmen's compensation, or to participate in any fund in
connection with workmen's compensation, unemployment insurance, old-age pensions
or other social security programs;
(iii) Liens of mechanics, materialmen, warehousemen, carriers, or
other like Liens, securing obligations incurred in the ordinary course of
business that are not yet due and payable and Liens of landlords securing
obligations to pay lease payments that are not yet due and payable or in
default;
(iv) Good-faith pledges or deposits made in the ordinary course of
business to secure performance of bids, tenders, contracts (other than for the
repayment of borrowed money) or leases, not in excess of the aggregate amount
due thereunder, or to secure statutory obligations, or surety, appeal,
indemnity, performance or other similar bonds required in the ordinary course of
business;
(v) Encumbrances consisting of zoning restrictions, easements or
other restrictions on the use of real property, none of which materially impairs
the use of such property or the value thereof, and none of which is violated in
any material respect by existing or proposed structures or land use;
(vi) Liens, security interests and mortgages in favor of the Agent
for the benefit of the Lenders securing the Obligations including liabilities
under any Lender-Provided Interest Rate Hedge;
(vii) Liens on property subject to a Sale-Leaseback permitted
pursuant to the terms hereof and Liens on property leased by any Loan Party or
Subsidiary of a Loan Party under capital and operating leases securing
obligations of such Loan Party or Subsidiary to the lessor under such leases;
(viii) Any Lien existing on the date of this Agreement and described
on Schedule 1.01(P), provided that the principal amount secured thereby is not
hereafter increased, and no additional assets become subject to such Lien;
(ix) Purchase Money Security Interests, provided that the aggregate
amount of loans and deferred payments secured by such Purchase Money Security
Interests shall not exceed $3,500,000 in any fiscal year of Borrower (excluding
for the purpose of this computation any loans or deferred payments secured by
Liens described on Schedule 1.01(P)); and
(x) Any of the following non-consensual Liens provided that such
Liens do not in the aggregate materially impair the ability of any Loan Party to
perform its Obligations hereunder or under the other Loan Documents and provided
further that the validity or amount thereof is being contested in good faith by
appropriate and lawful proceedings diligently conducted so long as levy and
execution thereon have been stayed and continue to be stayed:
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(1) Claims or Liens for taxes, assessments or charges due and
payable and subject to interest or penalty, provided that the applicable
Loan Party maintains such reserves or other appropriate provisions as
shall be required by GAAP and pays all such taxes, assessments or charges
forthwith upon the commencement of proceedings to foreclose any such Lien;
(2) Claims, Liens or encumbrances upon, and defects of title
to, real or personal property, including any attachment of personal or
real property or other legal process prior to adjudication of a dispute on
the merits;
(3) Claims or Liens of mechanics, materialmen, warehousemen,
carriers, or other statutory nonconsentual Liens; or
(4) Liens resulting from final judgments or orders described
in Section 8.01(f) provided such final judgment is discharged, vacated,
bonded or stayed pending appeal within thirty (30) days of entry.
PERSON shall mean any individual, corporation, partnership, limited
liability company, association, joint-stock company, trust, unincorporated
organization, joint venture, government or political subdivision or agency
thereof, or any other entity.
PLAN shall mean at any time an employee pension benefit plan (including a
Multiple Employer Plan, but not a Multiemployer Plan) which is covered by Title
IV of ERISA or is subject to the minimum funding standards under Section 412 of
the Internal Revenue Code and either (i) is maintained by any member of the
ERISA Group for employees of any member of the ERISA Group or (ii) has at any
time within the preceding five years been maintained by any entity which was at
such time a member of the ERISA Group for employees of any entity which was at
such time a member of the ERISA Group.
POTENTIAL DEFAULT shall mean any event or condition which with notice,
passage of time or a determination by the Agent or the Required Lenders, or any
combination of the foregoing, would constitute an Event of Default.
PRINCIPAL OFFICE shall mean the main banking office of the Agent in
Cleveland, Ohio.
PROHIBITED TRANSACTION shall mean any prohibited transaction as defined in
Section 4975 of the Internal Revenue Code or Section 406 of ERISA for which
neither an individual nor a class exemption has been issued by the United States
Department of Labor.
PROPERTY shall mean all real property, both owned and leased, of any Loan
Party or Subsidiary of a Loan Party.
PURCHASE MONEY SECURITY INTEREST shall mean Liens upon tangible personal
property securing loans to any Loan Party or Subsidiary of a Loan Party or
deferred payments by such Loan Party or Subsidiary for the purchase of such
tangible personal property.
PURCHASING LENDER shall mean a Lender which becomes a party to this
Agreement by executing an Assignment and Assumption Agreement.
RATABLE SHARE shall mean the proportion that a Lender's Commitment
(excluding the Swing Loan Commitment) bears to the Commitments (excluding the
Swing Loan Commitments) of all of the Lenders.
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REGISTER shall have the meaning ascribed to such term by Section 9.12.
REGULATED SUBSTANCES shall mean, without limitation, any substance,
material or waste, regardless of its form or nature, defined under Environmental
Laws as a "hazardous substance," "pollutant," "pollution," "contaminant,"
"hazardous or toxic substance," "extremely hazardous substance," "toxic
chemical," "toxic substance," "toxic waste," "hazardous waste," "special
handling waste," "industrial waste," "residual waste," "solid waste," "municipal
waste," "mixed waste," "infectious waste," "chemotherapeutic waste," "medical
waste," "pesticide" or "regulated substance" or any other substance, material or
waste, regardless of its form or nature, which is regulated, controlled or
governed by Environmental Laws due to its radioactive, ignitable, corrosive,
reactive, explosive, toxic, carcinogenic or infectious properties or nature or
any other material, substance or waste, regardless of its form or nature, which
otherwise is regulated, controlled or governed by Environmental Laws including
without limitation, petroleum and petroleum products (including crude oil and
any fractions thereof), natural gas, synthetic gas and any mixtures thereof,
asbestos, urea formaldehyde, polychlorinated biphenyls, mercury, radon and
radioactive materials.
REGULATION U shall mean any of Regulations U, T and X, as applicable, as
promulgated by the Board of Governors of the Federal Reserve System, as amended
from time to time.
REIMBURSEMENT OBLIGATION shall have the meaning assigned to such term in
Section 2.10(c)(ii).
REMEDIAL ACTION shall mean any investigation, identification, preliminary
assessment, characterization, delineation, feasibility study, cleanup,
corrective action, removal, remediation, risk assessment, fate and transport
analysis, in-situ treatment, containment, operation and maintenance or
management in-place, control or abatement of or other response actions to
Regulated Substances and any closure or post-closure measures associated
therewith.
REPORTABLE EVENT shall mean a reportable event described in Section 4043
of ERISA and regulations thereunder with respect to a Plan or Multiemployer
Plan.
REQUIRED LENDERS shall mean Lenders whose Revolving Credit Commitments
aggregate at least 51% of the Revolving Credit Commitments of all of the
Lenders, or if the Revolving Credit Commitments have terminated in their
entirety, those Lenders the sum of whose Revolving Credit Loans, Swing Loans,
and Ratable Share of Letters of Credit Outstanding aggregate at least 51% of all
Revolving Credit Loans, Swing Loans, and Letters of Credit Outstanding.
REVOLVING CREDIT COMMITMENT shall mean, as to any Lender at any time, the
amount initially set forth opposite its name on Schedule 1.01(B) in the column
labeled "Amount of Commitment for Revolving Credit Loans," and thereafter as
maintained by Agent in the Register.
REVOLVING CREDIT LOANS shall mean collectively and Revolving Credit Loan
shall mean separately all Revolving Credit Loans or any Revolving Credit Loan
made by the Lenders or one of the Lenders to the Borrower pursuant to Section
2.01 or Section 2.10(c).
REVOLVING CREDIT NOTE shall mean any Revolving Credit Note of the Borrower
in the form of Exhibit 1.01(R) issued by the Borrower at the request of a Lender
pursuant to Section 4.07 evidencing the Revolving Credit Loans to such Lender,
together with all amendments, extensions, renewals, replacements, refinancing,
or refundings thereof in whole or in part.
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REVOLVING FACILITY USAGE shall mean at any time the sum of the Revolving
Credit Loans and Swing Loans outstanding and the Letters of Credit Outstanding.
SAFETY LAWS shall mean the Occupational Safety and Health Act, 29 U.S.C.
Section 651 et seq., as amended, and any regulations promulgated thereunder or
any equivalent foreign, territorial, provincial state or local Law, each as
amended, and any regulations promulgated thereunder or any other foreign,
territorial, provincial, federal, state or local Law, each as amended, and any
regulations promulgated thereunder, pertaining or relating to the protection of
employees from exposure to Regulated Substances in the workplace (but excluding
workers compensation and wage and hour laws).
SAFETY COMPLAINTS shall mean any (i) notice of non-compliance or
violation, citation or order relating in any way to any Safety Law; (ii) civil,
criminal, administrative or regulatory investigation instituted by an Official
Body relating in any way to any Safety Law; (iii) administrative, regulatory or
judicial action, suit, claim or proceeding instituted by any Person or Official
Body or any written notice of liability or potential liability from any Person
or Official Body, in either instance, setting forth allegations relating to or a
cause of action for civil or administrative penalties, criminal fines or
penalties, or declaratory or equitable relief arising under any Safety Laws; or
(iv) subpoena, request for information or other written notice or demand of any
type issued by an Official Body pursuant to any Safety Laws.
SAFETY FILINGS AND RECORDS shall mean all notices, reports, records,
plans, applications, forms, logs, programs, manuals or other filings or
documents relating or pertaining to compliance with Safety Laws, including, but
not limited to, employee safety in the workplace, employee injuries or
fatalities, employee training, or the protection of employees from exposure to
Regulated Substances which pursuant to Safety Laws or at the direction or order
of any Official Body the Loan Parties or any Subsidiaries of any Loan either
must be submit to an Official Body or otherwise must maintain in their records.
SALE-LEASEBACK shall have the meaning set forth at Section 7.02(p).
SEC shall mean the Securities and Exchange Commission or any governmental
agencies substituted therefor.
SECTION 20 SUBSIDIARY shall mean the Subsidiary of the bank holding
company controlling any Lender, which Subsidiary has been granted authority by
the Federal Reserve Board to underwrite and deal in certain Ineligible
Securities.
SECURITY AGREEMENT shall mean the Security Agreement in substantially the
form of Exhibit 1.1(S)(1) executed and delivered by each of the Loan Parties to
the Agent for the benefit of the Lenders pursuant to Section 6.01(c) and Section
7.01(k).
SECURITY DOCUMENTS shall mean the Security Agreement and all other
documents, instruments, and agreements sufficient to provide the Agent for the
benefit of the Lenders with a first priority perfected Lien, subject only to
Permitted Liens, on all property, real and personal, of the Loan Parties
(subject, however, to a limitation on pledges of shares of stock held by a Loan
Party in a Subsidiary organized outside of the United States up to an amount
that would not result in an adverse tax consequence to any of the Loan Parties
under Section 956 of the Internal Revenue Code) pursuant to Section 6.01(c) and
Section 7.01(k).
-15-
SIGNIFICANT ASSET SALE shall mean any sale or related sales of assets
outside of the ordinary course of business (including the sale aspect of a
Sale-Leaseback) and permitted under Section 7.02(f), which assets have an
aggregate value of at least $3,500,000, provided, however, that life insurance
policies covering key individuals of the Loan Parties to be held by a to be
formed trust and payable with respect to certain benefit plans shall not be
included among the assets referred to in this definition.
SIGNIFICANT RECOVERY EVENT shall mean any recovery event or related
recovery events affecting assets having an aggregate value of at least
$3,500,000, provided, however, that life insurance policies covering key
individuals of the Loan Parties to be held by a to be formed trust and payable
with respect to certain benefit plans shall not be included among the assets
referred to in this definition.
SOLVENT shall mean, with respect to any Person on a particular date, that
on such date (i) the fair value of the property of such Person is greater than
the total amount of liabilities, including, without limitation, contingent
liabilities, of such Person, (ii) the present fair salable value of the assets
of such Person is not less than the amount that will be required to pay the
probable liability of such Person on its debts as they become absolute and
matured, (iii) such Person is able to realize upon its assets and pay its debts
and other liabilities, contingent obligations and other commitments as they
mature in the normal course of business, (iv) such Person does not intend to,
and does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature, and (v) such
Person is not engaged in business or a transaction, and is not about to engage
in business or a transaction, for which such Person's property would constitute
unreasonably small capital after giving due consideration to the prevailing
practice in the industry in which such Person is engaged. In computing the
amount of contingent liabilities at any time, it is intended that such
liabilities will be computed at the amount which, in light of all the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability.
STANDARD & POOR'S shall mean Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies, Inc., and its successors.
STANDBY LETTER OF CREDIT shall mean a Letter of Credit issued to support
obligations of one or more of the Loan Parties, contingent or otherwise, which
finance the working capital and business needs of the Loan Parties incurred in
the ordinary course of business, but excluding any Letter of Credit under which
the stated amount of such Letter of Credit increases automatically over time.
STANDBY LETTER OF CREDIT RATE shall mean the Applicable Margin under the
LIBOR Option.
SUBSIDIARY of any Person at any time shall mean (i) any corporation or
trust of which 50% or more (by number of shares or number of votes) of the
outstanding capital stock or shares of beneficial interest normally entitled to
vote for the election of one or more directors or trustees (regardless of any
contingency which does or may suspend or dilute the voting rights) is at such
time owned directly or indirectly by such Person or one or more of such Person's
Subsidiaries, (ii) any partnership of which such Person is a general partner or
of which 50% or more of the partnership interests is at the time directly or
indirectly owned by such Person or one or more of such Person's Subsidiaries,
(iii) any limited liability company of which such Person is a member or of which
50% or more of the limited liability company interests is at the time directly
or indirectly owned by such Person or one or more of such Person's Subsidiaries
or (iv) any corporation, trust, partnership, limited liability company or other
entity which is controlled or capable of being controlled by such Person or one
or more of such Person's Subsidiaries.
SUBSIDIARY SHARES shall have the meaning assigned to that term in Section
5.01(b).
-16-
SWING LOAN BANK shall mean National City Bank.
SWING LOAN COMMITMENT shall mean Swing Loan Bank's commitment to make
Swing Loans to the Borrower pursuant to Section 2.01(b) hereof in an aggregate
principal amount up to $10,000,000.
SWING LOAN NOTE shall mean the Swing Loan Note of the Borrower in the form
of Exhibit 1.01(S)(2) issued by the Borrower at the request of Swing Loan Bank
pursuant to Section 2.07 evidencing the Swing Loans, together with all
amendments, extensions, renewals, replacements, refinancings or refundings
thereof in whole or in part.
SWING LOAN REQUEST shall mean a request for Swing Loans made in accordance
with Section 2.05(b) hereof.
SWING LOANS shall mean collectively and Swing Loan shall mean separately
all Swing Loans or any Swing Loan made by Swing Loan Bank to the Borrower
pursuant to Section 2.01(b) hereof.
TRANSFEROR LENDER shall mean the selling Lender pursuant to an Assignment
and Assumption Agreement.
UTILIZATION FEE shall have the meaning assigned to that term in Section
2.03.
Section 1.02. Construction. Unless the context of this Agreement otherwise
clearly requires, the following rules of construction shall apply to this
Agreement and each of the other Loan Documents:
(a) Number; Inclusion. references to the plural include the
singular, the plural, the part and the whole; "or" has the inclusive meaning
represented by the phrase "and/or," and "including" has the meaning represented
by the phrase "including without limitation";
(b) Determination. references to "determination" of or by the Agent
or the Lenders shall be deemed to include good-faith estimates by the Agent or
the Lenders (in the case of quantitative determinations) and good-faith beliefs
by the Agent or the Lenders (in the case of qualitative determinations) and such
determination shall be conclusive absent manifest error;
(c) Agent's Discretion and Consent. whenever the Agent or the
Lenders are granted the right herein to act in its or their sole discretion or
to grant or withhold consent such right shall be exercised in good faith;
(d) Documents Taken as a Whole. the words "hereof," "herein,"
"hereunder," "hereto" and similar terms in this Agreement or any other Loan
Document refer to this Agreement or such other Loan Document as a whole and not
to any particular provision of this Agreement or such other Loan Document;
(e) Headings. the section and other headings contained in this
Agreement or such other Loan Document and the Table of Contents (if any),
preceding this Agreement or such other Loan Document are for reference purposes
only and shall not control or affect the construction of this Agreement or such
other Loan Document or the interpretation thereof in any respect;
-17-
(f) Implied References to this Agreement. Article, section,
subsection, clause, schedule and exhibit references are to this Agreement or
other Loan Document, as the case may be, unless otherwise specified;
(g) Persons. reference to any Person includes such Person's
successors and assigns but, if applicable, only if such successors and assigns
are permitted by this Agreement or such other Loan Document, as the case may be,
and reference to a Person in a particular capacity excludes such Person in any
other capacity;
(h) Modifications to Documents. reference to any agreement
(including this Agreement and any other Loan Document together with the
schedules and exhibits hereto or thereto), document or instrument means such
agreement, document or instrument as amended, modified, replaced, substituted
for, superseded or restated;
(i) From, To and Through. relative to the determination of any
period of time, "from" means "from and including," "to" means "to but
excluding," and "through" means "through and including"; and
(j) Independence of Covenants and Terms. All covenants and other
terms of this Agreement shall each be given effect so that if a particular
action or condition is not permitted by any such covenant or other term, the
fact that it would be expressly or impliedly permitted by another covenant or
term, by an exception thereto, or be otherwise within the limitations thereof,
shall not result in such action or condition being permissible.
(k) Shall; Will. references to "shall" and "will" are intended to
have the same meaning.
Section 1.03 Accounting Principles. Except as otherwise provided in this
Agreement, all computations and determinations as to accounting or financial
matters and all financial statements to be delivered pursuant to this Agreement
shall be made and prepared in accordance with GAAP (including principles of
consolidation where appropriate), and all accounting or financial terms shall
have the meanings ascribed to such terms by GAAP; provided, however, that all
accounting terms used in Section 7.02 [Negative Covenants] (and all defined
terms used in the definition of any accounting term used in Section 7.02 shall
have the meaning given to such terms (and defined terms) under GAAP as in effect
on the date hereof applied on a basis consistent with those used in preparing
the Historical Statements referred to in Section 5.01(h)(i) [Historical
Statements]. In the event of any change after the date hereof in GAAP, and if
such change would result in the inability to determine compliance with the
financial covenants set forth in Section 7.02 based upon the Borrower's
regularly prepared financial statements by reason of the preceding sentence,
then the parties hereto agree to endeavor, in good faith, to agree upon an
amendment to this Agreement that would adjust such financial covenants in a
manner that would not affect the substance thereof, but would allow compliance
therewith to be determined in accordance with the Borrower's financial
statements at that time.
ARTICLE II REVOLVING CREDIT AND SWING LOAN FACILITIES
Section 2.01 Revolving Credit Commitments.
(a) Revolving Credit Loans. Subject to the terms and conditions
hereof and relying upon the representations and warranties herein set forth,
each Lender severally agrees to make Revolving Credit Loans to the Borrower at
any time or from time to time on or after the date hereof to the
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Expiration Date provided that after giving effect to each such Loan the
aggregate amount of Loans from such Lender shall not exceed such Lender's
Revolving Credit Commitment minus such Lender's Ratable Share of the Letters of
Credit Outstanding. Within such limits of time and amount and subject to the
other provisions of this Agreement, the Borrower may borrow, repay and reborrow
pursuant to this Section 2.01.
(b) Swing Loan Commitment. Subject to the terms and conditions
hereof and relying upon the representations and warranties herein set forth,
Swing Loan Bank may, at its option, cancelable at any time for any reason
whatsoever, make swing loans (the "Swing Loans") to the Borrower at any time or
from time to time after the date hereof to the Expiration Date, in an aggregate
principal amount up to but not in excess of $10,000,000 (the "Swing Loan
Commitment"), provided that, notwithstanding the demand nature of Borrower's
obligation to repay Swing Loans, all Swing Loan outstanding shall be due and
payable in full on the fifteenth (15th) day of each month (or, if earlier, on
the Expiration Date) and provided further that (i) the aggregate principal
amount of Swing Loans and the Revolving Credit Loans of Swing Loan Bank at any
time outstanding and of Swing Loan Bank's Ratable Share of Letters of Credit
Outstanding shall not exceed the Revolving Credit Commitment of Swing Loan Bank,
and (ii) the Revolving Facility Usage at any one time outstanding shall not
exceed the Revolving Credit Commitments of all the Lenders. Within such limits
of time and amount and subject to the other provisions of this Agreement, the
Borrower may borrow, repay and reborrow pursuant to this Section 2.01(b).
Section 2.02 Nature of Lenders' Obligations with Respect to Revolving
Credit Loans. Each Lender shall be obligated to participate in each request for
Revolving Credit Loans pursuant to Section 2.05 [Revolving Credit Loan Requests]
in accordance with its Ratable Share. The aggregate of each Lender's Revolving
Credit Loans outstanding hereunder to the Borrower at any time shall never
exceed its Revolving Credit Commitment minus its Ratable Share of the Letters of
Credit Outstanding and minus its Ratable Share of Swing Loans outstanding. The
obligations of each Lender hereunder are several. The failure of any Lender to
perform its obligations hereunder shall not affect the Obligations of the
Borrower to any other party nor shall any other party be liable for the failure
of such Lender to perform its obligations hereunder. The Lenders shall have no
obligation to make Revolving Credit Loans hereunder on or after the Expiration
Date.
Section 2.03 Utilization Fee. The Borrower agrees to pay to the Agent for
the account of each Lender, a nonrefundable utilization fee (the "Utilization
Fee") at a rate per annum equal to the Applicable Utilization Fee Rate (computed
on the basis of a year of 360 days for the actual days elapsed) on such Lender's
Ratable Share of the Revolving Facility Usage (excluding Documentary Letters of
Credit but specifically including Standby Letters of Credit) for each day on
which the Revolving Facility Usage (excluding, however, Documentary Letters of
Credit but specifically including Standby Letters of Credit) exceeds fifty
percent (50%) of the total amount of the Revolving Credit Commitments (and
including each day on which Loans or any Letter of Credit remain outstanding
after the Commitments shall have expired or been terminated). All such
Utilization Fees shall be payable in arrears on the last Business Day of each
July, October, January, and April after the date hereof and on the Expiration
Date or upon acceleration of the Loan.
Section 2.04 Revolving Credit Facility Fee. The Borrower agrees to pay to
the Agent for the account of each Lender, as consideration for such Lender's
Revolving Credit Commitment, a nonrefundable facility fee (the "Facility
Fees")which shall accrue at the Applicable Facility Fee Rate (computed on the
basis of a year of 360 days and actual days elapsed) on the daily amount of such
Lender's Revolving Credit Commitment (whether used or unused) during the period
from and including
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the Closing Date to the date on which such Revolving Credit Commitment
terminates. Accrued facility fees shall be payable in arrears on the last
Business Day of each July, October, January, and April after the date hereof and
on the date on which such Revolving Credit Commitment terminates.
Section 2.05 Revolving Credit Loan Requests; Swing Loan Requests.
(a) Revolving Credit Loan Requests. Except as otherwise provided
herein, the Borrower may from time to time prior to the Expiration Date request
the Lenders to make Revolving Credit Loans, or renew or convert the Interest
Rate Option applicable to existing Revolving Credit Loans pursuant to Section
3.02 [Interest Periods], by delivering to the Agent, not later than 10:00 a.m.,
Cleveland time, (i) three (3) Business Days prior to the proposed Borrowing Date
with respect to the making of Revolving Credit Loans to which the LIBOR Option
applies or the conversion to or the renewal of the LIBOR Option for any Loans,
and (ii) on the proposed Borrowing Date with respect to the making of a
Revolving Credit Loan to which the Base Rate Option applies or on the last day
of the preceding Interest Period with respect to the conversion to the Base Rate
Option for any Loan then subject to the LIBOR Option, of a duly completed
request therefor substantially in the form of Exhibit 2.05(A) or a request by
telephone immediately confirmed in writing by letter, facsimile or telex in such
form (each, a "Loan Request"), it being understood that the Agent may rely on
the authority of any individual making such a telephonic request without the
necessity of receipt of such written confirmation. Each Loan Request shall be
irrevocable and shall specify (i) the proposed Borrowing Date; (ii) the
aggregate amount of the proposed Loans comprising each Borrowing Tranche, which
shall be in integral multiples of $500,000 and not less than $2,500,000 for each
Borrowing Tranche to which the LIBOR Option applies and integral multiples of
$500,000 and not less than the lesser of $1,000,000 or the maximum amount
available for Borrowing Tranches to which the Base Rate Option applies; (iii)
whether the LIBOR Option or Base Rate Option shall apply to the proposed Loans
comprising the applicable Borrowing Tranche; and (iv) in the case of a Borrowing
Tranche to which the LIBOR Option applies, an appropriate Interest Period for
the Loans comprising such Borrowing Tranche.
(b) Swing Loan Requests. Except as otherwise provided herein, the
Borrower may from time to time prior to the Expiration Date request Swing Loan
Bank to make Swing Loans by delivery to Swing Loan Bank, with a copy to the
Agent, not later than 10:00 a.m., Cleveland time, on the proposed Borrowing Date
of a duly completed request therefor substantially in the form of Exhibit
2.05(B) hereto or a request by telephone immediately confirmed in writing by
letter, facsimile or telex (each, a "Swing Loan Request"), it being understood
that the Swing Loan Bank and Agent may rely on the authority of any individual
making such a telephonic request without the necessity of receipt of such
written confirmation. Each Swing Loan Request shall be irrevocable and shall
specify the proposed Borrowing Date and the principal amount of such Swing Loan,
which shall be an integral multiple of $500,000.
Section 2.06 Making Revolving Credit Loans and Swing Loans.
(a) Making Revolving Credit Loans. The Agent shall, promptly after
receipt by it of a Loan Request pursuant to Section 2.05, notify the Lenders of
its receipt of such Loan Request specifying: (i) the proposed Borrowing Date and
the time and method of disbursement of the Revolving Credit Loans requested
thereby; (ii) the amount and type of each such Revolving Credit Loan and the
applicable Interest Period (if any); and (iii) the apportionment among the
Lenders of such Revolving Credit Loans as determined by the Agent in accordance
with Section 2.02 [Nature of Lenders' Obligations]. Each Lender shall remit the
principal amount of each Revolving Credit Loan to the Agent such that the Agent
is able to, and the Agent shall, to the extent the Lenders have made funds
available to it for such purpose and subject to Section 6.2 [Each Additional
Loan], fund such Revolving Credit Loans to the Borrower in
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U.S. Dollars and immediately available funds at the Principal Office prior to
2:00 p.m. Cleveland time on the applicable Borrowing Date, provided that if any
Lender fails to remit such funds to the Agent in a timely manner, the Agent may
elect in its sole discretion to fund with its own funds the Revolving Credit
Loans of such Lender on such Borrowing Date, and such Lender shall be subject to
the repayment obligation in Section 9.16 [Availability of Funds].
(b) Making Swing Loans. So long as Swing Loan Bank elects to make
Swing Loans, Swing Loan Bank shall, after receipt by it of a Swing Loan Request
pursuant to Section 2.05(b), fund such Swing Loan to the Borrower in U.S.
Dollars and immediately available funds at the Principal Office prior to 2:00
p.m. Cleveland time on the Borrowing Date.
Section 2.07 Swing Loan Note. The obligation of the Borrower to repay the
unpaid principal amount of the Swing Loans made to it by Swing Loan Bank
together with interest thereon shall be evidenced by a demand promissory note of
the Borrower dated the Closing Date in substantially the form attached hereto as
Exhibit 1.01(S)(2) payable to the order of Swing Loan Bank in a face amount
equal to the Swing Loan Commitment.
Section 2.08 Use of Proceeds. The proceeds of the Revolving Credit Loans
shall be used for (i) working capital and letters of credit, (ii) capital
expenditures, and (iii) general corporate purposes, and in accordance with
Section 7.01(j) [Use of Proceeds].
Section 2.09 Borrowings to Repay Swing Loans. Swing Loan Bank may, at its
option, exercisable at any time for any reason whatsoever, demand repayment of
the Swing Loans, and each Lender shall make a Revolving Credit Loan in an amount
equal to such Lender's Ratable Share of the aggregate principal amount of the
outstanding Swing Loans, plus, if Swing Loan Bank so requests, accrued interest
thereon; upon any such demand being made, Borrower shall be deemed to have
requested that such Swing Loans be converted to Revolving Credit Loans.
Revolving Credit Loans made pursuant to the preceding sentence shall bear
interest at the Base Rate Option and shall be deemed to have been properly
requested in accordance with Section 2.05(a), Article VI, and otherwise without
regard to any of the requirements of those provisions. Swing Loan Bank shall
provide notice to Agent who shall provide such notice to the Lenders (which may
be telephonic or written notice by letter, facsimile or telex) that such
Revolving Credit Loans are to be made under this Section 2.09 and of the
apportionment among the Lenders, and the Lenders shall be unconditionally
obligated to fund such Revolving Credit Loans (whether or not the conditions
specified in Section 2.05(a), Article VI, or otherwise are then satisfied) by
the time Swing Loan Bank so requests, which shall not be earlier than 10:00
a.m., Cleveland time, on the Business Day next after the date the Lenders
receive such notice from Swing Loan Bank.
Section 2.10 Letter of Credit Subfacility.
(a) Issuance of Letters of Credit. Borrower may request the issuance
of a letter of credit (each a "Letter of Credit") on behalf of itself for its
benefit or for the benefit of another Loan Party or any Subsidiary of a Loan
Party by delivering to the Issuing Bank selected by the Borrower (with a copy to
the Agent) a completed application or application and agreement for letters of
credit in such form, at such time, and with such advance notice as the Issuing
Bank may specify from time to time. Each Letter of Credit shall be either a
Standby Letter of Credit or a Documentary Letter of Credit.
Subject to the terms and conditions hereof and in reliance on the agreements of
the other Lenders set forth in this Section 2.10, the Issuing Bank will issue a
Letter of Credit, provided that each Letter of
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Credit shall (A) have a maximum maturity of twelve (12) months from the date of
issuance, provided, however, that Documentary Letters of Credit may provide for
automatic renewal (but in no event expire later than is set forth in the
directly following Clause (B)) subject to contrary notice given by the Issuing
Bank, and (B) in no event expire later than ten (10) Business Days prior to the
Expiration Date, and provided that in no event shall (i) the Letters of Credit
Outstanding exceed, at any one time, the Revolving Credit Commitments or (ii)
the Revolving Facility Usage exceed, at any one time, the Revolving Credit
Commitments. The letters of credit set forth on Schedule 2.10 are hereby deemed
to be Letters of Credit issued hereunder and governed pursuant hereto.
(b) Letter of Credit Fees. The Borrower shall pay to the Agent for
the ratable account of the Lenders a fee (the "Letter of Credit Fee") equal to
the Documentary Letter of Credit Rate for each Documentary Letter of Credit
issued and the Standby Letter of Credit Rate for each Standby Letter of Credit
issued (computed on the basis of a year of 360 days for the actual days
elapsed), which fees shall be computed on the daily average Letters of Credit
Outstanding and shall be payable quarterly in arrears commencing with the last
Business Day of each July, October, January, and April following issuance of
each Letter of Credit and on the Expiration Date. The Borrower shall also pay to
each Issuing Bank for the Issuing Bank's sole account, at the times determined
by the Issuing Bank, the Issuing Bank's then in effect fronting frees and
customary fees and administrative expenses payable with respect to the Letters
of Credit as such Issuing Bank may generally charge or incur from time to time
in connection with the issuance, maintenance, modification (if any), assignment
of proceeds or transfer (if any), negotiation, and administration of Letters of
Credit.
(c) Disbursements, Reimbursement.
(i) Immediately upon the issuance of each Letter of Credit,
each Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the Issuing Bank a participation in such Letter of
Credit and each drawing thereunder in an amount equal to such Lender's Ratable
Share of the maximum amount available to be drawn under such Letter of Credit
and the amount of such drawing, respectively, and each Lender shall be
responsible to reimburse such Issuing Bank immediately for its Ratable Share of,
or purchase a participation in such amount in any Letter of Credit Borrowing
relating to, any disbursement under any Letter of Credit which has not been
reimbursed by Borrower in accordance with this Section 2.10(c) by making its
Ratable Share of the Revolving Credit Loans, or the amount of its participation,
referred to in this Section 2.10(c) available to the Agent for the account of
the Issuing Bank. Upon the request of any Lender, the Issuing Banks shall notify
the Agent and the Agent shall notify each Lender of the amount of such Lender's
participation in Letters of Credit.
(ii) In the event of any request for a drawing under a Letter
of Credit by the beneficiary or transferee thereof, the Issuing Bank will
promptly notify the Agent and the Borrower, and the Agent will promptly notify
the Borrower. The Borrower shall reimburse (such obligation to reimburse shall
sometimes be referred to as a "Reimbursement Obligation") the Agent for the
account of the Issuing Bank prior to noon Cleveland time on each date that an
amount is paid by the Issuing Bank under any Letter of Credit (each such date, a
"Drawing Date") in an amount equal to the amount so paid by the Issuing Bank and
the Agent shall promptly forward such amount to the Issuing Bank. In the event
the Borrower fails to reimburse the Agent for the account of the Issuing Bank
for the full amount of any drawing under any Letter of Credit by noon on the
Drawing Date, the Agent will promptly notify each Lender (including the Issuing
Bank) thereof, and the Borrower shall be deemed to have requested that Revolving
Credit Loans be made by the Lenders under the Base Rate Option to be disbursed
on the Drawing Date under such Letter of Credit. Any notice given by the Agent
pursuant to this Section
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2.10(c)(ii) may be oral if immediately confirmed in writing; provided that the
lack of such an immediate confirmation shall not affect the conclusiveness or
binding effect of such notice.
(iii) Each Lender shall upon any notice pursuant to Section
2.10(c)(ii) above make available to the Agent for the account of the Issuing
Bank an amount in immediately available funds equal to its Ratable Share of the
amount of the drawing, whereupon the participating Lenders shall (subject to
Section 2.10(c)(iv) below) each be deemed to have made a Revolving Credit Loan
under the Base Rate Option to the Borrower in that amount. Revolving Credit
Loans made pursuant to the preceding sentence shall be deemed to have been
properly requested in accordance with Section 2.05(a), Article VI, and otherwise
without regard to any of the requirements of those provisions. If any Lender so
notified fails to make available to the Agent for the account of the Issuing
Bank the amount of such Lender's Ratable Share of such amount by no later than
2:00 p.m., Cleveland time on the Drawing Date, then interest shall accrue on
such Lender's obligation to make such payment, from the Drawing Date to the date
on which such Lender makes such payment (i) at a rate per annum equal to the
Federal Funds Effective Rate during the first three days following the Drawing
Date and (ii) at a rate per annum equal to the rate applicable to Loans under
the Base Rate Option on and after the fourth day following the Drawing Date. The
Issuing Bank will promptly give notice to the Agent and each other Lender of the
occurrence of the Drawing Date, but failure of the Issuing Bank to give any such
notice on the Drawing Date or in sufficient time to enable any Lender to effect
such payment on such date shall not relieve such Lender from its obligation
under this Section 2.10(c)(iii).
(iv) With respect to any unreimbursed drawing that is not
converted into Revolving Credit Loans under the Base Rate Option to the Borrower
in whole or in part as contemplated by Section 2.10(c)(ii) above, for any
reason, the Borrower shall be deemed to have incurred from the Issuing Bank a
borrowing (each a "Letter of Credit Borrowing") in the amount of such drawing.
Such Letter of Credit Borrowing shall be due and payable on demand (together
with interest) and shall bear interest at the rate per annum applicable to the
Revolving Credit Loans under the Base Rate Option. Each Lender's payment to the
Agent pursuant to Section 2.10(c)(iii) above shall nevertheless be due and shall
be deemed to be a payment in respect of its purchase of a participation in such
Letter of Credit Borrowing and shall constitute a "Participation Advance" from
such Lender in satisfaction of its participation obligation under this Section
2.10(c).
(d) Repayment of Participation Advances.
(i) Upon (and only upon) receipt by the Agent for the account
of the Issuing Bank of immediately available funds from the Borrower (i) in
reimbursement of any payment made by the Issuing Bank under the Letter of
Credit, or (ii) in payment of interest on such a payment made by the Issuing
Bank under such a Letter of Credit, in either case with respect solely to which
any Lender has made a Participation Advance to the Agent, the Agent will pay to
each Lender, in the same funds as those received by the Agent, the amount of
such Lender's Ratable Share of such funds (up to the amount of such Lender's
Participation Advance), except the Agent shall pay to the Issuing Bank the
amount of the Ratable Share of such funds of any Lender that did not make a
Participation Advance in respect of such payment by Issuing Bank or the interest
thereon.
(ii) If the Agent is required at any time to return to any
Loan Party, or to a trustee, receiver, liquidator, custodian, or any official in
any Insolvency Proceeding, any portion of the payments made by any Loan Party to
the Agent pursuant to Section 2.10(d)(i) directly above in reimbursement of a
payment made under the Letter of Credit or interest or fee thereon, each Lender
shall, on demand of the Agent, forthwith return to the Agent the amount of its
Ratable Share of any amounts so
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returned by the Agent plus interest thereon from the date such demand is made to
the date such amounts are returned by such Lender to the Agent, at a rate per
annum equal to the Federal Funds Effective Rate in effect from time to time.
(e) Documentation. Each Loan Party agrees to be bound by the terms
of an Issuing Bank's application and agreement for letters of credit and the
Issuing Bank's written regulations and customary practices relating to letters
of credit, though such interpretation may be different from such Loan Party's
own. In the event of a conflict between such application or agreement and this
Agreement, this Agreement shall govern. It is understood and agreed that, except
in the case of its gross negligence or willful misconduct, no Issuing Bank shall
be liable for any error, negligence or mistakes, whether of omission or
commission, in following any Loan Party's instructions or those contained in the
Letters of Credit or any modifications, amendments or supplements thereto.
(f) Nature of Participation and Reimbursement Obligations. Each
Lender's obligation in accordance with this Agreement to make the Revolving
Credit Loans or Participation Advances, as contemplated by Section 2.10(c)
above, as a result of a drawing under a Letter of Credit, and the Obligations of
the Borrower to reimburse the Agent upon a draw under a Letter of Credit, shall
be absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Section 2.10 under all circumstances,
including the following circumstances:
(A) any set-off, counterclaim, recoupment, defense or
other right which such Lender may have against any Issuing Bank, the Agent, the
Borrower or any other Person for any reason whatsoever;
(B) the failure of any Loan Party or any other Person to
comply, in connection with a Revolving Credit Loan made pursuant to Section
2.10(c)(iii) or a Letter of Credit Borrowing made pursuant to Section
2.10(c)(c)(iv), with the conditions set forth in Section 2.01 [Revolving Credit
Commitments], Section 2.05 [Revolving Credit Loan Requests], Section 2.05(b)
[Making Revolving Credit Loans] or Article VI [Conditions of Lending and
Issuance of Letters of Credit], or otherwise without regard to any of the
requirements of those provisions or as otherwise set forth in this Agreement for
the making of a Revolving Credit Loan, it being acknowledged that such
conditions are not required for the making of such Revolving Credit Loans,
Letter of Credit Borrowings, or Participation Advances;
(C) any lack of validity or enforceability of any Letter
of Credit;
(D) any claim of breach of warranty that might be made
by any Loan Party or any Lender against any beneficiary of a Letter of Credit,
or the existence of any claim, set-off, recoupment, counterclaim, crossclaim,
defense or other right which any Loan Party or any Lender may have at any time
against a beneficiary, successor beneficiary any transferee or assignee of any
Letter of Credit or the proceeds thereof (or any Persons for whom any such
transferee may be acting), the Agent, any Issuing Bank or any Lender or any
other Person or, whether in connection with this Agreement, the transactions
contemplated herein or any unrelated transaction (including any underlying
transaction between any Loan Party or Subsidiaries of a Loan Party and the
beneficiary for which any Letter of Credit was procured);
(E) the lack of power or authority of any signer of (or
any defect in or forgery of any signature or endorsement on) or the form of or
lack of validity, sufficiency, accuracy, enforceability or genuineness of any
draft, demand, instrument, certificate or other document presented
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under or in connection with any Letter of Credit, or any fraud or alleged fraud
in connection with any Letter of Credit, or the transport of any property or
provisions of services relating to a Letter of Credit, in each case even if the
Agent or the Issuing Bank or any of the Agent's or Issuing Bank's Affiliates has
been notified thereof;
(F) payment by any Issuing Bank or any of its Affiliates
under any Letter of Credit against presentation of a demand, draft or
certificate or other document which does not comply with the terms of such
Letter of Credit;
(G) the solvency of, or any acts of omissions by, any
beneficiary of any Letter of Credit, or any other Person having a role in any
transaction or obligation relating to a Letter of Credit, or the existence,
nature, quality, quantity, condition, value or other characteristic of any
property or services relating to a Letter of Credit;
(H) any failure by any Issuing Bank to issue any Letter
of Credit in the form requested by any Loan Party, unless such Issuing Bank has
received written notice from such Loan Party of such failure within three
Business Days after such Issuing Bank shall have furnished such Loan Party a
copy of such Letter of Credit and such error is material and no drawing has been
made thereon prior to receipt of such notice;
(I) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or prospects of any Loan
Party or Subsidiaries of a Loan Party;
(J) any breach of this Agreement or any other Loan
Document by any party thereto;
(K) the occurrence or continuance of an Insolvency
Proceeding with respect to any Loan Party;
(L) the fact that an Event of Default or a Potential
Default shall have occurred and be continuing;
(M) the fact that the Expiration Date shall have passed
or this Agreement or the Commitments hereunder shall have been terminated; and
(N) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing.
(g) Indemnity. In addition to amounts payable as provided in Section
9.05 [Reimbursement of Agent by Borrower, Etc.] and Section 10.03 [Reimbursement
and Indemnification of Lenders], the Borrower hereby agrees to protect,
indemnify, pay and save harmless the Agent and each Issuing Bank from and
against any and all claims, demands, liabilities, damages, taxes, penalties,
interest, judgments, losses, costs, charges and expenses (including reasonable
fees, expenses and disbursements of counsel and allocated costs of internal
counsel) which the Agent or any Issuing Bank may incur or be subject to as a
consequence, direct or indirect, of the issuance of any Letter of Credit, other
than as a result of (A) the gross negligence or willful misconduct of the Agent
or any Issuing Bank as determined by a final judgment of a court of competent
jurisdiction or (B) the wrongful dishonor by an Issuing Bank of a proper demand
for payment made under any Letter of Credit, except if such dishonor resulted
from
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any act or omission, whether rightful or wrongful, of any present or future de
jure or de facto government or governmental authority (all such acts or
omissions herein called "Governmental Acts").
(h) Liability for Acts and Omissions. As between each Loan Party,
each Issuing Bank and the Agent, such Loan Party assumes all risks of the acts
and omissions of, or misuse of the Letters of Credit by, the respective
beneficiaries of such Letters of Credit. In furtherance and not in limitation of
the foregoing, neither the Agent nor any Issuing Bank nor any Issuing Bank's
Affiliate shall be responsible for any of the following including any losses or
damages to any Loan Party or other Person or property relating therefrom: (i)
the form, validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any party in connection with the application for an
issuance of or for a drawing under any such Letter of Credit, even if it should
in fact prove to be in any or all respects invalid, insufficient, inaccurate,
fraudulent or forged (even if the Issuing Bank shall have been notified
thereof); (ii) the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any such Letter of Credit or the
rights or benefits thereunder or proceeds thereof, in whole or in part, which
may prove to be invalid or ineffective for any reason; (iii) the failure of the
beneficiary of any such Letter of Credit, or any other party to which such
Letter of Credit may be transferred, to comply fully with any conditions
required in order to draw upon such Letter of Credit, or any claim of any Loan
Party against any beneficiary of such Letter of Credit, or any such transferee,
or any dispute between or among any Loan Party and any beneficiary of any Letter
of Credit or any such transferee; (iv) errors, omissions, interruptions or
delays in transmission or delivery of any messages, by mail, cable, telegraph,
telex or otherwise, whether or not they be in cipher; (v) errors in
interpretation of technical terms or errors in the translation of any Letter of
Credit or any documents or instructions relating thereto; (vi) any loss or delay
in the transmission or otherwise of any document required in order to make a
drawing under any such Letter of Credit or of the proceeds thereof; (vii) the
misapplication by the beneficiary of any such Letter of Credit of the proceeds
of any drawing under such Letter of Credit; or (viii) any consequences arising
from causes beyond the control of any Issuing Bank, as applicable, including any
Governmental Acts, and none of the above shall affect or impair, or prevent the
vesting of, any of the Agent's or any Issuing Bank's rights or powers hereunder;
the respective Issuing Bank's only obligation to the Borrower being to confirm
that any documents required to be delivered under such Letter of Credit appear
to have been delivered and that they appear to generally comply on their face
with the requirements of such Letter of Credit (unless any such requirements are
waived by a Loan Party). Subject to the provisions of the immediately preceding
sentence, any action taken or omitted to be taken by any Issuing Bank under or
in connection with any Letter of Credit if taken or omitted in the absence of
gross negligence or willful misconduct, as determined by a court of competent
jurisdiction, shall not create for such Issuing Bank any resulting liability to
the Borrower or any other Loan Party. In no event shall the Agent or any Issuing
Bank be liable to any Loan Party for any indirect, consequential, incidental,
punitive, exemplary or special damages or expenses (including without limitation
attorneys' fees), or for any damages resulting from any change in the value of
any property relating to a Letter of Credit.
Without limiting the generality of the foregoing, the Agent and each
Issuing Bank (i) may rely on any oral or other communication believed in good
faith by the Agent or such Issuing Bank to have been authorized or given by or
on behalf of the applicant for a Letter of Credit, (ii) may honor any
presentation if the documents presented appear on their face substantially to
comply with the terms and conditions of the relevant Letter of Credit; (iii) may
honor a previously dishonored presentation under a Letter of Credit, whether
pursuant to a court order, to settle or compromise any claim of wrongful
dishonor, or otherwise, and shall be entitled to reimbursement to the same
extent as if such presentation had initially been honored, together with any
interest paid by the Agent or such Issuing Bank; (iv) may honor any drawing that
is payable upon presentation of a statement advising negotiation or payment,
upon receipt of
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such statement (even if such statement indicates that a draft or other document
is being delivered separately), and shall not be liable for any failure of any
such draft or other document to arrive, or to conform in any way with the
relevant Letter of Credit; (v) may pay any paying or negotiating bank claiming
that it rightfully honored under the laws or practices of the place where such
bank is located; and (vi) may settle or adjust any claim or demand made on the
Agent or such Issuing Bank in any way related to any order issued at the
applicant's request to an air carrier, a letter of guarantee or of indemnity
issued to a carrier or any similar document (each an "Order") and honor any
drawing in connection with any Letter of Credit that is the subject to such
Order, notwithstanding that any drafts or other documents presented in
connection with such Letter of Credit fail to conform in any way with such
Letter of Credit.
In furtherance and not in limitation of the specific provisions set forth
above, any action taken or omitted by the Agent or an Issuing Bank under or in
connection with any Letters of Credit issued by it or any documents and
certificates delivered thereunder, if taken or omitted in good faith, shall not
put the Agent or such Issuing Bank under any resulting liability to the Borrower
or any Lender.
ARTICLE III INTEREST RATES
Section 3.01 Interest Rate Options. The Borrower shall pay interest in
respect of the outstanding unpaid principal amount of the Revolving Credit Loans
as selected by it from the Base Rate Option or LIBOR Option set forth below
applicable to the Revolving Credit Loans, it being understood that, subject to
the provisions of this Agreement, the Borrower may select different Interest
Rate Options and different Interest Periods to apply simultaneously to the
Revolving Credit Loans comprising different Borrowing Tranches and may convert
to or renew one or more Interest Rate Options with respect to all or any portion
of the Revolving Credit Loans comprising any Borrowing Tranche, provided that
there shall not be at any one time outstanding more than five (5) Borrowing
Tranches in the aggregate among all of the Revolving Credit Loans accruing
interest at the LIBOR Option, and provided further that only the Base Rate
Option or the Offered Rate Option shall apply to the Swing Loans. If at any time
the designated rate applicable to any Loan made by any Lender exceeds such
Lender's highest lawful rate, the rate of interest on such Lender's Loan shall
be limited to such Lender's highest lawful rate.
(a) Revolving Credit Interest Rate Options. The Borrower shall have
the right to select from the following Interest Rate Options applicable to the
Revolving Credit Loans (subject to the provisions above regarding refinancing
Swing Loans and refinancing Reimbursement Obligations):
(i) Base Rate Option: A fluctuating rate per annum (computed
on the basis of a year of 365 or 366 days, as the case may be, for the actual
days elapsed) equal to the Base Rate plus the Applicable Margin, such interest
rate to change automatically from time to time effective as of the effective
date of each change in the Base Rate; or
(ii) LIBOR Option: A rate per annum (computed on the basis of
a year of 360 days for the actual days elapsed) equal to LIBOR plus the
Applicable Margin.
(b) Rate Quotations. The Borrower may call the Agent on or before
the date on which a Loan Request is to be delivered to receive an indication of
the rates then in effect, but it is acknowledged that such projection shall not
be binding on the Agent or the Lenders nor affect the rate of interest which
thereafter is actually in effect when the election is made.
(c) Change in Fees or Interest Rates. Any increase or decrease in
Applicable Margin due to an increase or decrease in the Leverage Ratio Level
after the Closing Date shall be effective on the
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first calendar day following the date on which the Compliance Certificate
evidencing the computation of such Leverage Ratio Level is due to be delivered
under Section 7.03(c). If the Applicable Margin or Applicable Facility Fee Rate
or Applicable Utilization Fee Rate is thereby increased or reduced with respect
to any period for which the Borrower has already paid interest or Facility Fees
or Utilization Fees, the Agent shall recalculate the additional interest,
Facility Fees, and Utilization Fees due from or to the Borrower and shall,
within fifteen (15) Business Days after the Borrower notifies the Agent of such
increase or decrease, give the Borrower and the Lenders notice of such
recalculation.
(i) Any additional interest or Facility Fees or Utilization
Fees due from the Borrower shall be paid to the Agent for the account of the
Lenders on the next date on which an interest or fee payment is due; provided,
however, that if there are no Loans outstanding or if the Loans are due and
payable, such additional interest, Facility Fees, and Utilization Fees shall be
paid promptly after receipt of written request for payment from the Agent.
(ii) Any interest or Facility Fees or Utilization Fees refund
due to the Borrower shall be credited against payments otherwise due from the
Borrower on the next interest or fee payment due date or, if the Loans have been
repaid and the Lenders are no longer committed to lend under this Agreement, the
Lenders shall pay the Agent for the account of the Borrower such interest or
Facility Fees or Utilization Fees refund not later than five Business Days after
written notice from the Agent to the Lenders.
Section 3.02 Interest Periods. At any time when the Borrower shall select,
convert to or renew a LIBOR Option, the Borrower shall notify the Agent thereof
at least three (3) Business Days prior to the effective date of such LIBOR
Option by delivering a Loan Request. The notice shall specify an Interest Period
during which such Interest Rate Option shall apply. Notwithstanding the
preceding sentence, the following provisions shall apply to any selection of,
renewal of, or conversion to a LIBOR Option:
(a) Amount of Borrowing Tranche. Each Borrowing Tranche of LIBOR
Loans shall be in integral multiples of $500,000 and not less than $2,500,000;
(b) Renewals. In the case of the renewal of a LIBOR Option at the
end of an Interest Period, the first day of the new Interest Period shall be the
last day of the preceding Interest Period, without duplication in payment of
interest for such day.
Section 3.03 Interest After Default. To the extent permitted by Law, upon
the occurrence of an Event of Default and until such time such Event of Default
shall have been cured or waived:
(a) Letter of Credit Fees, Interest Rate. The Letter of Credit Fees
and the rate of interest for each Loan otherwise applicable pursuant to Section
2.10(b) [Letter of Credit Fees] or Section 3.01 [Interest Rate Options],
respectively, shall be increased by 2.0% per annum; and
(b) Other Obligations. Each other Obligation hereunder if not paid
when due shall bear interest at a rate per annum equal to the sum of the rate of
interest applicable under the Base Rate Option plus an additional 2.0% per annum
from the time such Obligation becomes due and payable and until it is paid in
full.
Upon the occurrence of an Event of Default and until such time such Event of
Default shall have been cured or waived, each Loan subject to the LIBOR Option
shall, on the last day of the Interest Period then
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in effect during such Event of Default convert to a Loan subject to the Base
Rate Option and bear interest in accordance with the terms of this Section 3.03.
(c) Acknowledgment. The Borrower acknowledges that the increase in
rates referred to in this Section 3.03 reflects, among other things, the fact
that such Loans or other amounts have become a substantially greater risk given
their default status and that the Lenders are entitled to additional
compensation for such risk; and all such interest shall be payable by Borrower
upon demand by Agent.
Section 3.04 LIBOR Unascertainable; Illegality; Increased Costs; Deposits
Not Available.
(a) Unascertainable. If on any date on which a LIBO-Rate would
otherwise be determined, the Agent shall have determined that:
(i) adequate and reasonable means do not exist for
ascertaining such LIBO-Rate, or
(ii) a contingency has occurred which materially and adversely
affects the London interbank eurodollar market relating to the LIBO-Rate, the
Agent shall have the rights specified in Section 3.04(c).
(b) Illegality; Increased Costs; Deposits Not Available. If at any
time any Lender shall have determined that:
(i) the making, maintenance or funding of any Loan to which a
LIBOR Option applies has been made impracticable or unlawful by compliance by
such Lender in good faith with any Law or any interpretation or application
thereof by any Official Body or with any request or directive of any such
Official Body (whether or not having the force of Law), or
(ii) such LIBOR Option will not adequately and fairly reflect
the cost to such Lender of the establishment or maintenance of any such Loan, or
(iii) after making all reasonable efforts, deposits of the
relevant amount in Dollars for the relevant Interest Period for a Loan, or to
banks generally, to which a LIBOR Option applies, respectively, are not
available to such Lender with respect to such Loan, or to banks generally, in
the interbank eurodollar market,
then the Agent shall have the rights specified in Section 3.04(c).
(c) Agent's and Lender's Rights. In the case of any event specified
in Section 3.04(a) above, the Agent shall promptly so notify the Lenders and the
Borrower thereof, and in the case of an event specified in Section 3.04(b)
above, such Lender shall promptly so notify the Agent and endorse a certificate
to such notice as to the specific circumstances of such notice, and the Agent
shall promptly send copies of such notice and certificate to the other Lenders
and the Borrower. Upon such date as shall be specified in such notice (which
shall not be earlier than the date such notice is given), the obligation of (A)
the Lenders, in the case of such notice given by the Agent, or (B) such Lender,
in the case of such notice given by such Lender, to allow the Borrower to
select, convert to or renew a LIBOR Option shall be suspended until the Agent
shall have later notified the Borrower, or such Lender shall have later notified
the Agent, of the Agent's or such Lender's, as the case may be, determination
that the circumstances giving rise to such previous determination no longer
exist. If at any time the Agent makes
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a determination under Section 3.04(a) and the Borrower has previously notified
the Agent of its selection of, conversion to or renewal of a LIBOR Option and
such Interest Rate Option has not yet gone into effect, such notification shall
be deemed to provide for selection of, conversion to or renewal of the Base Rate
Option otherwise available with respect to such Loans. If any Lender notifies
the Agent of a determination under Section 3.04(b), the Borrower shall, subject
to the Borrower's indemnification Obligations under Section 4.06(b) [Indemnity],
as to any Loan of the Lender to which a LIBOR Option applies, on the date
specified in such notice either convert such Loan to the Base Rate Option
otherwise available with respect to such Loan or prepay such Loan in accordance
with Section 4.04 [Voluntary Prepayments]. Absent due notice from the Borrower
of conversion or prepayment, such Loan shall automatically be converted to the
Base Rate Option otherwise available with respect to such Loan upon such
specified date.
Section 3.05 Selection of Interest Rate Options. If the Borrower fails to
select a new Interest Period or Interest Rate Option to apply to any Borrowing
Tranche of Loans under the LIBOR Option at the expiration of an existing
Interest Period applicable to such Borrowing Tranche in accordance with the
provisions hereof, the Borrower shall be deemed to have converted such Borrowing
Tranche to the Base Rate Option, commencing upon the last day of the existing
Interest Period.
ARTICLE IV PAYMENTS
Section 4.01 Payments. All payments and prepayments to be made in respect
of principal, interest, Utilization Fees, Facility Fees, Letter of Credit Fees,
Agent's Fee or other fees or amounts due from the Borrower hereunder shall be
payable prior to 11:00 a.m., Cleveland time, on the date when due without
presentment, demand, protest or notice of any kind, all of which are hereby
expressly waived by the Borrower, and without set-off, counterclaim or other
deduction of any nature, and an action therefor shall immediately accrue. Such
payments shall be made to the Agent at the Principal Office for the account of
Swing Loan Bank with respect to the Swing Loans and for the ratable accounts of
the Lenders with respect to the Revolving Credit Loans in U.S. Dollars and in
immediately available funds, and the Agent shall promptly distribute such
amounts to the Lenders in immediately available funds, provided that in the
event payments are received by 11:00 a.m., Cleveland time, by the Agent with
respect to the Loans and such payments are not distributed to the Lenders on the
same day received by the Agent, the Agent shall pay the Lenders the Federal
Funds Effective Rate with respect to the amount of such payments for each day
held by the Agent and not distributed to the Lenders. The Agent's and each
Lender's statement of account, ledger or other relevant record shall, in the
absence of manifest error, be conclusive as the statement of the amount of
principal of and interest on the Loans and other amounts owing under this
Agreement.
Section 4.02 Pro Rata Treatment of Lenders. Each borrowing shall be
allocated to each Lender according to its Ratable Share, and each selection of,
conversion to or renewal of any Interest Rate Option and each payment or
prepayment by the Borrower with respect to principal, interest, Utilization
Fees, Facility Fees, Letter of Credit Fees, or other fees (except for the
Agent's Fee) or amounts due from the Borrower hereunder to the Lenders with
respect to the Loans, shall (except as provided in Section 3.04(c) [Agent's and
Lender's Rights] in the case of an event specified in Section 3.04 [LIBO-Rate
Unascertainable; Etc.], Section 4.04(b) [Replacement of a Lender] or Section
4.06 [Additional Compensation in Certain Circumstances]) be made in proportion
to the applicable Loans outstanding from each Lender and, if no such Loans are
then outstanding, in proportion to the Ratable Share of each Lender.
Notwithstanding any of the foregoing, each borrowing or payment or prepayment by
the Borrower of principal, interest, fees or other amounts from the Borrower
with respect to Swing Loans shall be made by or to Swing Loan Bank according to
Article II.
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Section 4.03 Interest Payment Dates. Interest on Loans to which the Base
Rate Option applies shall be due and payable in arrears on the last Business Day
of each July, October, January, and April after the date hereof and on the
Expiration Date or upon acceleration of the Loan. Interest on Loans to which the
LIBOR Option applies shall be due and payable on the last day of each Interest
Period for those Loans and, if such Interest Period is longer than three (3)
Months, also on that day which is three (3) Months after the beginning of such
Interest Period. Interest on mandatory prepayments of principal under Section
4.05 [Mandatory Prepayments] shall be due on the date such mandatory prepayment
is due. Interest on the principal amount of each Loan or other monetary
Obligation shall be due and payable on demand after such principal amount or
other monetary Obligation becomes due and payable (whether on the stated
maturity date, upon acceleration or otherwise).
Section 4.04 Voluntary Prepayments.
(a) Right to Prepay. The Borrower shall have the right at its option
from time to time to prepay the Loans in whole or part without premium or
penalty (except as provided in Section 4.04(b) below or in Section 4.06
[Additional Compensation in Certain Circumstances]):
(i) at any time with respect to any Loan to which the Base
Rate Option applies,
(ii) on the last day of the applicable Interest Period with
respect to Loans to which a LIBOR Option applies,
(iii) on the date specified in a notice by any Lender pursuant
to Section 3.04 [LIBO-Rate Unascertainable, Etc.] with respect to any Loan to
which a LIBOR Option applies.
Whenever the Borrower desires to prepay any part of the Loans, it
shall provide a prepayment notice to the Agent by 1:00 p.m. at least one (1)
Business Day prior to the date of prepayment of Revolving Credit Loans subject
to the Base Rate Option and at least three (3) Business Days prior to the date
of prepayment of Revolving Credit Loans subject to the LIBOR Option or no later
than 10:00 a.m. Cleveland time on the date of prepayment of Swing Loans, setting
forth the following information:
(x) the date, which shall be a Business Day, on which the
proposed prepayment is to be made;
(y) a statement indicating the application of the prepayment
between the Swing Loans, Revolving Credit Loans; and
(z) the total principal amount of such prepayment, which shall
not be less than $1,000,000 for any Swing Loan or $1,000,000 for any
Revolving Credit Loan.
All prepayment notices shall be irrevocable. The principal amount of
the Loans for which a prepayment notice is given, together with interest on such
principal amount except with respect to Loans to which the Base Rate Option
applies, shall be due and payable on the date specified in such prepayment
notice as the date on which the proposed prepayment is to be made. Except as
provided in Section 3.04(c) [Agent's and Lender's rights], if the Borrower
prepays a Loan but fails to specify the applicable Borrowing Tranche which the
Borrower is prepaying, the prepayment shall be applied (i) to Revolving Credit
Loans; and (ii) after giving effect to the allocations in clause (i) above and
in the
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preceding sentence, first to Loans to which the Base Rate Option applies, then
to Loans to which the LIBOR Option applies. Any prepayment hereunder shall be
subject to the Borrower's Obligation to indemnify the Lenders under Section
4.06(b) [Indemnity].
(b) Replacement of a Lender. In the event any Lender (i) gives
notice under [LIBO-Rate Unascertainable, Etc.] or Section 4.06(a) [Increased
Costs, Etc.], (ii) does not fund Revolving Credit Loans because the making of
such Loans would contravene any Law applicable to such Lender, or (iii) becomes
subject to the control of an Official Body (other than normal and customary
supervision), then the Borrower shall have the right at its option, with the
consent of the Agent, which shall not be unreasonably withheld, to prepay the
Loans of such Lender in whole, together with all interest accrued thereon, and
terminate such Lender's Commitment within ninety (90) days after (x) receipt of
such Lender's notice under Section 3.04 [LIBO-Rate Unascertainable, Etc.] or
Section 4.06(a) [Increased Costs, Etc.], (y) the date such Lender has failed to
fund Revolving Credit Loans because the making of such Loans would contravene
Law applicable to such Lender, or (z) the date such Lender became subject to the
control of an Official Body, as applicable; provided that the Borrower shall
also pay to such Lender at the time of such prepayment any amounts required
under Section 4.06 [Additional Compensation in Certain Circumstances] and any
accrued interest due on such amount and any related fees; provided, however,
that the Commitment of such Lender shall be provided by one or more of the
remaining Lenders or a replacement bank acceptable to the Agent; provided,
further, the remaining Lenders shall have no obligation hereunder to increase
their Commitments. Notwithstanding the foregoing, the Agent may only be replaced
subject to the requirements of Section 9.14 [Successor Agent] and provided that
all Letters of Credit have expired or been terminated or replaced.
(c) Change of Lending Office. Each Lender agrees that upon the
occurrence of any event giving rise to increased costs or other special payments
under Section 3.04(b) [Illegality, Etc.] or Section 4.06(a) [Increased Costs,
Etc.] 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 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 regulatory
disadvantage, with the object of avoiding the consequence of the event giving
rise to the operation of such Section. Nothing in this Section 4.04(c) shall
affect or postpone any of the Obligations of the Borrower or any other Loan
Party or the rights of the Agent or any Lender provided in this Agreement.
(d) Voluntary Reduction of Commitments. The Borrower shall have the
right, upon not less than five (5) Business Days' written irrevocable notice to
the Agent, to terminate the Revolving Credit Commitments or, from time to time,
to reduce the amount of the Revolving Credit Commitments, which notice shall
specify the date and amount of any such reduction and otherwise be substantially
in the form of Exhibit 4.04(D) (a "Commitment Reduction Notice"). Any such
reduction shall be in a minimum amount equal to $2,500,000 or an integral
multiple of $2,500,000 in excess thereof, provided, that the Revolving Credit
Commitments may not be reduced below the sum of the aggregate principal amount
of all Revolving Facility Usage. Each reduction of Revolving Credit Commitments
shall ratably reduce the Revolving Credit Commitments of the Lenders.
Section 4.05 Mandatory Prepayments.
(a) Mandatory Prepayment Upon Sale of Assets; Mandatory Reduction of
Revolving Credit Commitments. Within five (5) Business Days of any Significant
Asset Sale by any one or more Loan Parties, the Revolving Credit Commitments
shall automatically and permanently be reduced in an amount equal to the net
cash proceeds of such Significant Asset Sale. On the date of any reduction of
the
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Revolving Credit Commitments pursuant to this Section 4.05(a), the Borrower
shall make a mandatory prepayment of so much of the Revolving Credit Loans as
shall be necessary in order that the Revolving Facility Usage will not exceed
the Revolving Credit Commitments after giving effect to such reduction. Any
prepayment hereunder shall be subject to the Borrower's Obligation to indemnify
the Lenders under Section 4.06(b) [Indemnity]. Notwithstanding the foregoing, no
reduction of the Revolving Credit Commitments (or concomitant prepayment as
required below) shall be required to the extent of those net cash proceeds from
such Significant Asset Sale which Borrower certifies to the Agent that it
reasonably expects to use to purchase substitute or replacement assets for use
in the business of the Borrower or another Loan Party within one hundred eighty
(180) days of the date of such Significant Asset Sale. All such substitute or
replacement assets shall be subject to or, if necessary in the judgment of
Agent, made subject to the Security Documents. In the event that such
substitution or replacement purchase has not occurred within such one hundred
eighty (180) day period, the Borrower shall make a mandatory prepayment of all
net cash proceeds not so expended. All net cash proceeds not certified as
expected to be so expended on substitute or replacement assets for use in the
business of the Borrower or another Loan Party within such one hundred eighty
(180) day period shall be subject to the first sentence of this Section 4.05(a).
(b) Mandatory Prepayment Upon Significant Recovery Event; Mandatory
Reduction of Revolving Credit Commitments. Within five (5) Business Days of any
Significant Recovery Event, the Revolving Credit Commitments shall automatically
and permanently be reduced in an amount equal to the net cash proceeds of such
Significant Recovery Event. On the date of any reduction of the Revolving Credit
Commitments pursuant to this Section 4.05(b), the Borrower shall make a
mandatory prepayment of so much of the Revolving Credit Loans as shall be
necessary in order that the Revolving Facility Usage will not exceed the
Revolving Credit Commitments after giving effect to such reduction. Any
prepayment hereunder shall be subject to the Borrower's Obligation to indemnify
the Lenders under Section 4.06(b) [Indemnity]. Notwithstanding the foregoing, no
reduction of the Revolving Credit Commitments (or concomitant prepayment as
required below) shall be required to the extent of those net cash proceeds from
such Significant Recovery Event which Borrower certifies to the Agent that it
reasonably expects to use to purchase substitute or replacement assets for use
in the business of the Borrower or another Loan Party within one hundred eighty
(180) days of the date of such Significant Recovery Event. All such substitute
or replacement assets shall be subject to or, if necessary in the judgment of
Agent, made subject to the Security Documents. In the event that such
substitution or replacement purchase has not occurred within such one hundred
eighty (180) day period, the Borrower shall make a mandatory prepayment of all
net cash proceeds not so expended. All net cash proceeds not certified as
expected to be so expended on substitute or replacement assets for use in the
business of the Borrower or another Loan Party within such one hundred eighty
(180) day period shall be subject to the first sentence of this Section 4.05(b).
(c) Application Among Interest Rate Options; Cash Collateral Under
Certain Circumstances. All prepayments required pursuant to this Section 4.05
shall first be applied among the Interest Rate Options to the principal amount
of the Loans subject to the Base Rate Option, then to Loans subject to a LIBOR
Option. In accordance with Section 4.06(b) [Indemnity], the Borrower shall
indemnify the Lenders for any loss or expense, including loss of margin,
incurred with respect to any such prepayments applied against Loans subject to a
LIBOR Option on any day other than the last day of the applicable Interest
Period. In the event that all Revolving Credit Loans have been prepaid pursuant
to Section 4.05(a) or Section 405(b), but the Revolving Facility Usage continues
to exceed the Revolving Credit Commitments, then Borrower shall deposit in a
non-interest bearing account with the Agent, as cash collateral for the
Obligations, an amount equal to the amount by which the Revolving Facility Usage
exceeds the Revolving Credit Commitments after giving effect to such reduction,
and the Borrower
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hereby pledges to the Agent and the Lenders, and grants to the Agent and the
Lenders a security interest in, all such cash as security for such Obligations.
Upon and to the extent that the Revolving Credit Commitments (after giving
effect to such reduction) plus the amount of such cash collateral exceeds the
Revolving Facility Usage, the Agent shall release and return an amount of such
cash collateral equal to such excess to the Borrower upon its request.
Section 4.06 Additional Compensation in Certain Circumstances.
(a) Increased Costs or Reduced Return Resulting From Taxes,
Reserves, Capital Adequacy Requirements, Expenses, Etc. If any Law, guideline or
interpretation or any change in any Law, guideline or interpretation or
application thereof by any Official Body charged with the interpretation or
administration thereof or compliance with any request or directive (whether or
not having the force of Law) of any central bank or other Official Body:
(i) subjects any Lender to any tax or changes the basis of
taxation with respect to this Agreement, the Loans or payments by the Borrower
of principal, interest, Facility Fees, Utilization Fees, or other amounts due
from the Borrower hereunder (except for taxes on the overall net income of such
Lender),
(ii) imposes, modifies or deems applicable any reserve,
special deposit or similar requirement against credits or commitments to extend
credit extended by, or assets (funded or contingent) of, deposits with or for
the account of, or other acquisitions of funds by, any Lender, or
(iii) imposes, modifies or deems applicable any capital
adequacy or similar requirement (A) against assets (funded or contingent) of, or
letters of credit, other credits or commitments to extend credit extended by,
any Lender, or (B) otherwise applicable to the obligations of any Lender under
this Agreement and under agreements of a similar nature with other obligors to
such Lender,
and the result of any of the foregoing is to increase the cost to, reduce the
income receivable by, or impose any expense (including loss of margin) upon any
Lender, by an amount which such Lender in its sole discretion deems to be
material, with respect to this Agreement or with respect to the making,
maintenance or funding of any part of the Loans (or, in the case of any capital
adequacy or similar requirement, to have the effect of reducing the rate of
return on any Lender's capital, taking into consideration such Lender's
customary policies with respect to capital adequacy), such Lender shall from
time to time notify the Borrower and the Agent of the amount determined in good
faith (using any averaging and attribution methods employed in good faith) by
such Lender to be necessary to compensate such Lender for such increase in cost,
reduction of income, additional expense or reduced rate of return. Such notice
shall set forth in reasonable detail the basis for such determination. Such
amount shall be due and payable by the Borrower to such Lender ten (10) Business
Days after such notice is given.
(b) Indemnity. In addition to the compensation required by Section
4.05(a) [Increased Costs, Etc.], the Borrower shall indemnify each Lender
against all liabilities, losses or expenses (including loss of margin, any loss
or expense incurred in liquidating or employing deposits from third parties and
any loss or expense incurred in connection with funds acquired by a Lender to
fund or maintain Loans subject to a LIBOR Option) which such Lender sustains or
incurs as a consequence of any
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(i) payment, prepayment, conversion or renewal of any Loan to
which a LIBOR Option applies on a day other than the last day of the
corresponding Interest Period (whether or not such payment or prepayment is
mandatory, voluntary or automatic and whether or not such payment or prepayment
is then due),
(ii) attempt by the Borrower to revoke (expressly, by later
inconsistent notices or otherwise) in whole or part any Loan Requests under
Section 2.05 [Revolving Credit Loan Requests] or Section 3.02 [Interest Periods]
or notice relating to prepayments under Section 4.04 [Voluntary Prepayments], or
(iii) default by the Borrower in the performance or observance
of any covenant or condition contained in this Agreement or any other Loan
Document, including any failure of the Borrower to pay when due (by acceleration
or otherwise) any principal, interest, Facility Fee, Utilization Fee, or any
other amount due hereunder.
If any Lender sustains or incurs any such loss or expense, it shall
from time to time notify the Borrower of the amount determined in good faith by
such Lender (which determination may include such assumptions, allocations of
costs and expenses and averaging or attribution methods as such Lender shall
deem reasonable) to be necessary to indemnify such Lender for such loss or
expense. Such notice shall set forth in reasonable detail the basis for such
determination. Such amount shall be due and payable by the Borrower to such
Lender ten (10) Business Days after such notice is given.
Section 4.07 Taxes.
(a) No Deductions. All payments made by Borrower hereunder and under
each Note shall be made free and clear of and without deduction for any present
or future taxes, levies, imposts, deductions, charges, or withholdings, and all
liabilities with respect thereto, excluding taxes imposed on the net income of
any Lender and all income and franchise taxes applicable to any Lender of the
United States (all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings, and liabilities being hereinafter referred to as
"Taxes"). If Borrower shall be required by Law to deduct any Taxes from or in
respect of any sum payable hereunder or under any Note, (i) the sum payable
shall be increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 4.07(a)) each Lender receives an amount equal to the sum it would
have received had no such deductions been made, (ii) Borrower shall make such
deductions and (iii) Borrower shall timely pay the full amount deducted to the
relevant tax authority or other authority in accordance with applicable Law.
(b) Stamp Taxes. In addition, Borrower agrees to pay any present or
future stamp or documentary taxes or any other excise or property taxes,
charges, or similar levies which arise from any payment made hereunder or from
the execution, delivery, or registration of, or otherwise with respect to, this
Agreement or any Note (hereinafter referred to as "Other Taxes").
(c) Indemnification for Taxes Paid by a Lender. Borrower shall
indemnify each Lender for the full amount of Taxes or Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed by any jurisdiction on
amounts payable under this Section 4.07(c)) paid by any Lender and any liability
(including penalties, interest, and expenses) arising therefrom or with respect
thereto, whether or not such Taxes or Other Taxes were correctly or legally
asserted. This indemnification shall be made within 30 days from the date a
Lender makes written demand therefor.
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(d) Certificate. Within 30 days after the date of any payment of any
Taxes by Borrower, Borrower shall furnish to each Lender, at its address
referred to herein, the original or a certified copy of a receipt evidencing
payment thereof. If no Taxes are payable in respect of any payment by Borrower,
such Borrower shall, if so requested by a Lender, provide a certificate of an
officer of Borrower to that effect.
(e) Survival. Without prejudice to the survival of any other
agreement of Borrower hereunder, the agreements and obligations of Borrower
contained in this Section 4.07(c) shall survive the payment in full of principal
and interest hereunder and under any instrument delivered hereunder.
Section 4.08 Judgment Currency.
(a) Currency Conversion Procedures for Judgments. If for the
purposes of obtaining judgment in any court it is necessary to convert a sum due
hereunder or under a Note in any currency (the "Original Currency") into another
currency (the "Other Currency"), the parties hereby agree, to the fullest extent
permitted by Law, that the rate of exchange used shall be that at which in
accordance with normal banking procedures each Lender could purchase the
Original Currency with the Other Currency after any premium and costs of
exchange on the Business Day preceding that on which final judgment is given.
(b) Indemnity in Certain Events. The obligation of Borrower in
respect of any sum due from Borrower to any Lender hereunder shall,
notwithstanding any judgment in an Other Currency, whether pursuant to a
judgment or otherwise, be discharged only to the extent that, on the Business
Day following receipt by any Lender of any sum adjudged to be so due in such
Other Currency, such Lender may in accordance with normal banking procedures
purchase the Original Currency with such Other Currency. If the amount of the
Original Currency so purchased is less than the sum originally due to such
Lender in the Original Currency, Borrower agrees, as a separate obligation and
notwithstanding any such judgment or payment, to indemnify such Lender against
such loss.
Section 4.09 Notes; Principal Payment of Revolving Credit Loans. Borrower
hereby promises to pay to the order of each Lender the lesser of (i) the
principal sum of such Lender's Revolving Credit Commitment, or (ii) the
aggregate unpaid principal balance of all Revolving Credit Loans made by such
Lender to the Borrower pursuant to this Agreement, payable together with all
other amounts outstanding hereunder no later than 11:00 a.m. on the Expiration
Date, and to pay interest on the unpaid principal balance thereof from time to
time outstanding from the date hereof at the rate or rates per annum specified
by the Borrower pursuant to, or as otherwise provided in, this Agreement
(notwithstanding any one or more judgments or defaults) and at the times
provided for in this Agreement. Subject to the terms hereof, payments of
principal, interest, fees, and all other amounts from time to time payable
hereunder shall be made without setoff, counterclaim, or other deduction of any
nature at the Principal Office of the Agent in lawful money of the United States
of America in immediately available funds. Upon the request of any Lender, the
Revolving Credit Loans made by such Lender may be evidenced by a Revolving
Credit Note in the form of Exhibit 1.01(R).
ARTICLE V REPRESENTATIONS AND WARRANTIES
Section 5.01 Representations and Warranties. The Loan Parties, jointly and
severally, represent and warrant to the Agent and each of the Lenders as
follows:
(a) Organization and Qualification. Each Loan Party and each
Subsidiary of each Loan Party is a corporation, partnership or limited liability
company duly organized, validly existing and in
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good standing under the laws of its jurisdiction of organization. Each Loan
Party and each Subsidiary of each Loan Party has the lawful power to own or
lease its properties and to engage in the business it presently conducts or
proposes to conduct. Each Loan Party and each Subsidiary of each Loan Party is
duly licensed or qualified and in good standing in each jurisdiction where the
property owned or leased by it or the nature of the business transacted by it or
both makes such licensing or qualification necessary.
(b) Subsidiaries.
(i) Schedule 5.01(B)(I) states the name of each of the
Borrower's Subsidiaries, its jurisdiction of incorporation, its authorized
capital stock, the issued and outstanding shares (referred to herein as the
"Subsidiary Shares") and the owners thereof if it is a corporation, its
outstanding partnership interests (the "Partnership Interests") if it is a
partnership and its outstanding limited liability company interests, interests
assigned to managers thereof and the voting rights associated therewith (the
"LLC Interests") if it is a limited liability company. The Borrower and each
Subsidiary of the Borrower has good and marketable title to all of the
Subsidiary Shares, Partnership Interests and LLC Interests it purports to own,
free and clear in each case of any Lien. All Subsidiary Shares, Partnership
Interests and LLC Interests have been validly issued, and all Subsidiary Shares
are fully paid and nonassessable. All capital contributions and other
consideration required to be made or paid in connection with the issuance of the
Partnership Interests and LLC Interests have been made or paid, as the case may
be. There are no options, warrants or other rights outstanding to purchase any
such Subsidiary Shares, Partnership Interests or LLC Interests except as
indicated on Schedule 5.01(B).
(ii) Schedule 5.01(B)(II) sets forth the location in the
United States of every store and other place at which any inventory of any Loan
Party is held, other than any such inventory that is in transit.
(c) Power and Authority. Each Loan Party has full power to enter
into, execute, deliver and carry out this Agreement and the other Loan Documents
to which it is a party, to incur the Indebtedness contemplated by the Loan
Documents and to perform its Obligations under the Loan Documents to which it is
a party, and all such actions have been duly authorized by all necessary
proceedings on its part.
(d) Validity and Binding Effect. This Agreement has been duly and
validly executed and delivered by each Loan Party, and each other Loan Document
which any Loan Party is required to execute and deliver on or after the date
hereof will have been duly executed and delivered by such Loan Party on the
required date of delivery of such Loan Document. This Agreement and each other
Loan Document constitutes, or will constitute, legal, valid and binding
obligations of each Loan Party which is or will be a party thereto on and after
its date of delivery thereof, enforceable against such Loan Party in accordance
with its terms, except to the extent that enforceability of any of such Loan
Document may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforceability of creditors' rights generally
or limiting the right of specific performance and except to the extent that the
effectiveness of any Security Document or Ancillary Security Document is
expressly limited by the terms hereof.
(e) No Conflict. Neither the execution and delivery of this
Agreement or the other Loan Documents by any Loan Party nor the consummation of
the transactions herein or therein contemplated or compliance with the terms and
provisions hereof or thereof by any of them will conflict with, constitute a
default under or result in any breach of (i) the terms and conditions of the
certificate of
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incorporation, bylaws, certificate of limited partnership, partnership
agreement, certificate of formation, limited liability company agreement or
other organizational documents of any Loan Party or (ii) any Law or any material
agreement or instrument or order, writ, judgment, injunction or decree to which
any Loan Party or any of its Subsidiaries is a party or by which it or any of
its Subsidiaries is bound or to which it is subject, or result in the creation
or enforcement of any Lien, charge or encumbrance whatsoever upon any property
(now or hereafter acquired) of any Loan Party or any of its Subsidiaries (other
than Liens granted under the Loan Documents).
(f) Litigation. There are no actions, suits, proceedings or
investigations (other than Environmental Complaints and Safety Complaints which
are specifically addressed in Section 5.01(u) [Environmental Matters and Safety
Matters]) pending or, to the knowledge of any Loan Party, threatened against
such Loan Party or any Subsidiary of such Loan Party at law or equity before any
Official Body which individually or in the aggregate could reasonably be
expected to result in any Material Adverse Change. None of the Loan Parties or
any Subsidiaries of any Loan Party is in violation of any order, writ,
injunction or any decree of any Official Body (excluding any Environmental
Complaints and Safety Complaints which are specifically addressed in
Section 5.01(u) [Environmental Matters and Safety Matters]) which may result in
any Material Adverse Change.
(g) Title to Properties. Each Loan Party and each Subsidiary
of each Loan Party has good and marketable title to or valid leasehold interest
in all properties, assets and other rights which it purports to own or lease or
which are reflected as owned or leased on its books and records, free and clear
of all Liens and encumbrances (other than Environmental Complaints which are
specifically addressed in Section 5.01(u) [Environmental Matters and Safety
Complaints]) except Permitted Liens, and subject to the terms and conditions of
the applicable leases. All leases of property are in full force and effect
without the necessity for any consent which has not previously been obtained
upon consummation of the transactions contemplated hereby.
(h) Financial Statements.
(i) Historical Statements. The Borrower has delivered to the
Agent copies of its audited consolidated year-end financial statements for and
as of the end of the fiscal year ended February 1, 2003 (the "Historical
Statements"). The Historical Statements were compiled from the books and records
maintained by the Borrower's management, are correct and complete and fairly
represent the consolidated financial condition of the Borrower and its
Subsidiaries as of their dates and the results of operations for the fiscal
periods then ended and have been prepared in accordance with GAAP consistently
applied, subject (in the case of the Interim Statements) to normal year-end
audit adjustments.
(ii) Financial Projections. The Borrower has delivered to the
Agent financial projections of the Borrower and its Subsidiaries for the period
of Borrower's fiscal years 2003, 2004 and 2005 derived from various assumptions
of the Borrower's management (the "Financial Projections"). The Financial
Projections represent a reasonable range of possible results in light of the
history of the business, present and foreseeable conditions and the intentions
of the Borrower's management. The Financial Projections accurately reflect the
liabilities of the Borrower and its Subsidiaries upon consummation of the
transactions contemplated hereby as of the Closing Date.
(iii) Accuracy of Financial Statements. Neither the Borrower
nor any Subsidiary of the Borrower has any material liabilities, contingent or
otherwise, or forward or long-term commitments that are not disclosed in the
Historical Statements or in the notes thereto, and except as disclosed therein
there are no unrealized or anticipated losses from any commitments of the
Borrower or
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any Subsidiary of the Borrower which may cause a Material Adverse Change. Since
February 1, 2003, no Material Adverse Change has occurred.
(i) Use of Proceeds; Margin Stock; Section 20 Subsidiaries.
(i) General. The Loan Parties intend to use the proceeds of
the Loans in accordance with Section 2.07 and Section 7.01(j).
(ii) Margin Stock. None of the Loan Parties or any
Subsidiaries of any Loan Party engages or intends to engage principally, or as
one of its important activities, in the business of extending credit for the
purpose, immediately, incidentally or ultimately, of purchasing or carrying
margin stock (within the meaning of Regulation U). No part of the proceeds of
any Loan has been or will be used, immediately, incidentally or ultimately, to
purchase or carry any margin stock or to extend credit to others for the purpose
of purchasing or carrying any margin stock or to refund Indebtedness originally
incurred for such purpose, or for any purpose which entails a violation of or
which is inconsistent with the provisions of the regulations of the Board of
Governors of the Federal Reserve System. None of the Loan Parties or any
Subsidiary of any Loan Party holds or intends to hold margin stock in such
amounts that more than 25% of the reasonable value of the assets of any Loan
Party or Subsidiary of any Loan Party are or will be represented by margin
stock.
(iii) Section 20 Subsidiaries. The Loan Parties do not intend
to use and shall not use any portion of the proceeds of the Loans, directly or
indirectly, to purchase during the underwriting period, or for thirty (30) days
thereafter, Ineligible Securities being underwritten by a Section 20 Subsidiary.
(j) Full Disclosure. Neither this Agreement nor any other Loan
Document, nor any certificate, statement, agreement or other documents furnished
to the Agent or any Lender in connection herewith or therewith, contains any
untrue statement of a material fact or omits to state a material fact necessary
in order to make the statements contained herein and therein, in light of the
circumstances under which they were made, not misleading. There is no fact known
to any Loan Party which materially adversely affects the business, property,
assets, financial condition, results of operations or prospects of any Loan
Party or Subsidiary of any Loan Party which has not been set forth in this
Agreement or in the certificates, statements, agreements or other documents
furnished in writing to the Agent and the Lenders prior to or at the date hereof
in connection with the transactions contemplated hereby.
(k) Taxes. All federal, state, local and other tax returns required
to have been filed with respect to each Loan Party and each Subsidiary of each
Loan Party have been filed, and payment or adequate provision has been made for
the payment of all taxes, fees, assessments and other governmental charges which
have or may become due pursuant to said returns or to assessments received,
except to the extent that such taxes, fees, assessments and other charges are
being contested in good faith by appropriate proceedings diligently conducted
and for which such reserves or other appropriate provisions, if any, as shall be
required by GAAP shall have been made. There are no agreements or waivers
extending the statutory period of limitations applicable to any federal income
tax return of any Loan Party or Subsidiary of any Loan Party for any period.
(l) Consents and Approvals. No consent, approval, exemption, order
or authorization of, or a registration or filing with, any Official Body or any
other Person is required by any Law (other than any such consents, filings,
notices or registrations required by Environmental Law which are specifically
addressed in Section 5.01(u) [Environmental Matters and Safety Matters]) or any
agreement
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in connection with the execution, delivery and carrying out of this Agreement
and the other Loan Documents by any Loan Party, except as listed on Schedule
5.01(L), all of which shall have been obtained or made on or prior to the
Closing Date except as otherwise indicated on Schedule 5.01(L).
(m) No Event of Default; Compliance With Instruments. No event has
occurred and is continuing and no condition exists or will exist after giving
effect to the borrowings or other extensions of credit to be made available on
the Closing Date under or pursuant to the Loan Documents which constitutes an
Event of Default or Potential Default. None of the Loan Parties or any
Subsidiaries of any Loan Party is in violation of (i) any term of its
certificate of incorporation, bylaws, certificate of limited partnership,
partnership agreement, certificate of formation, limited liability company
agreement or other organizational documents or (ii) any material agreement or
instrument to which it is a party or by which it or any of its properties may be
subject or bound where such violation would constitute a Material Adverse
Change.
(n) Patents, Trademarks, Copyrights, Licenses, Etc. Each Loan Party
and each Subsidiary of each Loan Party owns or possesses or holds valid and
effective licenses covering all the material patents, trademarks, service marks,
trade names, copyrights, licenses, registrations, franchises, permits and rights
necessary to own and operate its properties and to carry on its business as
presently conducted and planned to be conducted by such Loan Party or
Subsidiary, without known possible, alleged or actual conflict with the rights
of others.
(o) Insurance. No notice has been given or claim made and no grounds
exist to cancel or avoid any of such policies or bonds or to reduce the coverage
provided thereby. Such policies and bonds provide adequate coverage from
reputable and financially sound insurers in amounts sufficient to insure the
assets and risks of each Loan Party and each Subsidiary of each Loan Party in
accordance with prudent business practice in the industry of the Loan Parties
and their Subsidiaries.
(p) Compliance With Laws. The Loan Parties and their Subsidiaries
are in compliance in all material respects with all applicable Laws (other than
Environmental Laws or Safety Laws which are specifically addressed in Section
5.01(u) [Environmental Matters and Safety Matters]) in all jurisdictions in
which any Loan Party or Subsidiary of any Loan Party is presently or will be
doing business except where the failure to do so would not constitute a Material
Adverse Change.
(q) Material Contracts; Burdensome Restrictions. All material
contracts relating to the business operations of each Loan Party and each
Subsidiary of any Loan Party, including all employee benefit plans and Labor
Contracts are valid, binding and enforceable upon such Loan Party or Subsidiary
and each of the other parties thereto in accordance with their respective terms,
and there is no default thereunder, to the Loan Parties' knowledge, with respect
to parties other than such Loan Party or Subsidiary. None of the Loan Parties or
their Subsidiaries is bound by any contractual obligation, or subject to any
restriction in any organization document, or any requirement of Law which could
result in a Material Adverse Change.
(r) Investment Companies; Regulated Entities. None of the Loan
Parties or any Subsidiaries of any Loan Party is an "investment company"
registered or required to be registered under the Investment Company Act of 1940
or under the "control" of an "investment company" as such terms are defined in
the Investment Company Act of 1940 and shall not become such an "investment
company" or under such "control." None of the Loan Parties or any Subsidiaries
of any Loan Party is subject to any other Federal or state statute or regulation
limiting its ability to incur Indebtedness for borrowed money.
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(s) Plans and Benefit Arrangements.
(i) The Borrower and each other member of the ERISA Group are
in compliance in all material respects with any applicable provisions of ERISA
with respect to all Benefit Arrangements, Plans and Multiemployer Plans. There
has been no Prohibited Transaction with respect to any Benefit Arrangement or
any Plan or, to the best knowledge of the Borrower, with respect to any
Multiemployer Plan or Multiple Employer Plan, which could result in any material
liability of the Borrower or any other member of the ERISA Group. The Borrower
and all other members of the ERISA Group have made when due any and all payments
required to be made under any agreement relating to a Multiemployer Plan or a
Multiple Employer Plan or any Law pertaining thereto. With respect to each Plan
and Multiemployer Plan, the Borrower and each other member of the ERISA Group
(i) have fulfilled in all material respects their obligations under the minimum
funding standards of ERISA, (ii) have not incurred any liability to the PBGC,
and (iii) have not had asserted against them any penalty for failure to fulfill
the minimum funding requirements of ERISA. All Plans, Benefit Arrangements and
Multiemployer Plans have been administered in accordance with their terms and
applicable Law.
(ii) No event requiring notice to the PBGC under Section
302(f)(4)(A) of ERISA has occurred or is reasonably expected to occur with
respect to any Plan, and no amendment with respect to which security is required
under Section 307 of ERISA has been made or is reasonably expected to be made to
any Plan.
(iii) Neither the Borrower nor any other member of the ERISA
Group has incurred or reasonably expects to incur any material withdrawal
liability under ERISA to any Multiemployer Plan or Multiple Employer Plan.
Neither the Borrower nor any other member of the ERISA Group has been notified
by any Multiemployer Plan or Multiple Employer Plan that such Multiemployer Plan
or Multiple Employer Plan has been terminated within the meaning of Title IV of
ERISA and, to the best knowledge of the Borrower, no Multiemployer Plan or
Multiple Employer Plan is reasonably expected to be reorganized or terminated,
within the meaning of Title IV of ERISA.
(t) Employment Matters. Each of the Loan Parties and each of their
Subsidiaries is in compliance with the Labor Contracts and all applicable
federal, state and local labor and employment Laws including those related to
equal employment opportunity and affirmative action, labor relations, minimum
wage, overtime, child labor, medical insurance continuation, worker adjustment
and relocation notices, immigration controls and worker and unemployment
compensation, where the failure to comply would constitute a Material Adverse
Change. There are no outstanding material grievances, arbitration awards or
appeals therefrom arising out of the Labor Contracts or current or threatened
strikes, picketing, handbilling or other work stoppages or slowdowns at
facilities of any of the Loan Parties or any of their Subsidiaries which in any
case would constitute a Material Adverse Change. The Borrower has delivered to
the Agent true and correct copies of each of the Labor Contracts.
(u) Environmental Matters. None of the Loan Parties or any
Subsidiaries of any Loan Party has received any Environmental Complaint, and
none of the Loan Parties has any reason to believe that such an Environmental
Complaint might be received. There are no pending or, to any Loan Party's
knowledge, threatened Environmental Complaints relating to any Loan Party or
Subsidiary of any Loan Party or any predecessor in interest of any such Loan
Party or Subsidiary of any Loan Party or any of the Properties or, to any Loan
Party's knowledge, any prior owner, operator or occupant of any of the
Properties pertaining to, or arising out of, any Contamination or violations of
Environmental Laws or Required Environmental Permits. The Loan Parties and their
Subsidiaries are in compliance with all applicable Environmental Laws except
where the failure to do so would constitute a Material Adverse Change. The Loan
Parties and their Subsidiaries hold and are operating in compliance with
Environmental Permits, except where the failure to do so would not constitute a
Material Adverse
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Change. None of the Loan Parties or any Subsidiaries of any Loan Party has
received any Safety Complaint and none of the Loan Parties has any reason to
believe that such an Safety Complaint might be received. The Loan Parties and
their Subsidiaries are in compliance with all applicable Safety Laws except
where the failure to do so would constitute a Material Adverse Change.
(v) Senior Debt Status. The Obligations of each Loan Party under
this Agreement, the Guaranty Agreement and each of the other Loan Documents to
which it is a party do rank and will rank at least pari passu in priority of
payment with all other Indebtedness of such Loan Party except Indebtedness of
such Loan Party to the extent secured by Permitted Liens. There is no Lien upon
or with respect to any of the properties or income of any Loan Party or
Subsidiary of any Loan Party which secures indebtedness or other obligations of
any Person except for Permitted Liens.
(w) Solvency. Both the Borrower and the Borrower and its
Subsidiaries on a consolidated basis are Solvent after giving effect to the
transactions contemplated by the Loan Documents and any incurrence of
Indebtedness and all other Obligations.
(x) Tax Shelter Intentions. Subject to any later inconsistent notice
provided pursuant to Section 7.03(i), neither Borrower nor any other Loan Party
intends to treat any Loan or Letter of Credit or any transaction related thereto
as a "reportable transaction" (within the meaning of Treasury Regulation Section
1.6011-4, as amended from time to time).
Section 5.02 Continuation of Representations. The Loan Parties make the
representations and warranties in this Article V on the date hereof and on the
Closing Date and each date thereafter on which a Loan is made or a Letter of
Credit is issued as provided in and subject to Article VI.
ARTICLE VI CONDITIONS OF LENDING AND ISSUANCE OF LETTERS OF CREDIT
The obligation of each Lender to make Loans and of any Issuing Bank to
issue Letters of Credit hereunder is subject to the performance by each of the
Loan Parties of its Obligations to be performed hereunder at or prior to the
making of any such Loans or issuance of such Letters of Credit and to the
satisfaction of the following further conditions:
Section 6.01 First Loans and Letters of Credit. On the Initial Loan Date:
(a) Officer's Certificate. The representations and warranties of
each of the Loan Parties contained in Article V and in each of the other Loan
Documents shall be true and accurate on and as of the Closing Date with the same
effect as though such representations and warranties had been made on and as of
such date (except representations and warranties which relate solely to an
earlier date or time, which representations and warranties shall be true and
correct on and as of the specific dates or times referred to therein), and each
of the Loan Parties shall have performed and complied with all covenants and
conditions hereof and thereof, no Event of Default or Potential Default shall
have occurred and be continuing or shall exist; and, by their execution and
delivery hereof, each of the Loan Parties shall be deemed to have delivered to
the Agent for the benefit of each Lender a certificate of each of the Loan
Parties, dated the Closing Date, to each such effect.
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(b) Secretary's Certificate. There shall be delivered to the Agent
for the benefit of each Lender a certificate dated the Closing Date and signed
by the Secretary or an Assistant Secretary of each of the Loan Parties,
certifying as appropriate as to:
(i) all action taken by each Loan Party in connection with
this Agreement and the other Loan Documents;
(ii) the names of the officer or officers authorized to sign
this Agreement and the other Loan Documents and the true signatures of such
officer or officers and specifying the Authorized Officers permitted to act on
behalf of each Loan Party for purposes of this Agreement and the true signatures
of such officers, on which the Agent and each Lender may conclusively rely; and
(iii) copies of its organizational documents, including its
certificate of incorporation, bylaws, certificate of limited partnership,
partnership agreement, certificate of formation, and limited liability company
agreement as in effect on the Closing Date certified by the appropriate state
official where such documents are filed in a state office together with
certificates from the appropriate state officials as to the continued existence
and good standing of each Loan Party in each state where organized or qualified
to do business.
(c) Delivery of Loan Documents, Security Documents. This Agreement,
the Guaranty Agreement and the Security Documents and such Ancillary Security
Documents as are appropriate at such time, shall have been duly executed and
delivered to the Agent for the benefit of the Lenders, together with all
appropriate financing statements. The Agent and the Lenders and each of the Loan
Parties hereby agree that the Security Documents and such Ancillary Security
Documents shall become and thereafter be deemed irrevocably effective, and the
security interest granted pursuant to the Security Agreement shall attach, only
upon the occurrence and continuation of an Event of Default, provided that such
effectiveness and attachment shall continue with respect to each item of
collateral security covered thereby until such item is released in connection
with the indefeasible repayment of all Loans and the expiration of all Letters
of Credit and the permanent termination of all Commitments, or pursuant to an
agreement, waiver, consent, release, or the like granted pursuant to Section
10.01(c), or as otherwise provided herein. For the avoidance of any doubt, the
Guaranty Agreement shall become effective upon its receipt by Agent.
(d) Opinion of Counsel. There shall be delivered to the Agent for
the benefit of each Lender a written opinion of Xxxxxx Xxxxxx Xxxxxx & Xxxxxx,
LLP, counsel for the Loan Parties (who may rely on the opinions of such other
counsel as may be acceptable to the Agent), dated as of the Closing Date and in
form and substance satisfactory to the Agent and its counsel:
(i) as to the matters set forth in and subject to Exhibit
7.1.4; and
(ii) as to such other matters incident to the transactions
contemplated herein as the Agent may reasonably request.
(e) Legal Details. All legal details and proceedings in connection
with the transactions contemplated by this Agreement and the other Loan
Documents shall be completed to the satisfaction of Agent and shall be in form
and substance satisfactory to the Agent and counsel for the Agent, and the Agent
shall have received all such reports, appraisals, counterpart originals or
certified or other copies of all such documents and proceedings in connection
with such transactions, in form and substance satisfactory to the Agent and said
counsel, as the Agent or said counsel may reasonably request.
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(f) Payment of Fees. The Borrower shall have paid or caused to be
paid to the Agent for itself and for the account of the Lenders to the extent
not previously paid the fees accrued through the Closing Date (including fees
arising under the Agent's Letter) and the costs and expenses for which the Agent
and the Lenders are entitled to be reimbursed.
(g) Consents. All material consents required to effectuate the
transactions contemplated hereby as set forth on Schedule 5.01(L) shall have
been obtained.
(h) Officer's Certificate Regarding MACs. Since February 1, 2003, no
Material Adverse Change shall have occurred and, by their execution and delivery
hereof, each of the Loan Parties shall be deemed to have delivered to the Agent
for the benefit of each Lender a certificate dated the Closing Date of each Loan
Party to such effect.
(i) No Violation of Laws. The making of the Loans and the issuance
of the Letters of Credit shall not contravene any Law applicable to any Loan
Party or any of the Lenders.
(j) No Actions or Proceedings. No action, proceeding, investigation,
regulation or legislation shall have been instituted, threatened or proposed
before any court, governmental agency or legislative body to enjoin, restrain or
prohibit, or to obtain damages in respect of, this Agreement, the other Loan
Documents, or the consummation of the transactions contemplated hereby or
thereby or which, in the Agent's sole discretion, would make it inadvisable to
consummate the transactions contemplated by this Agreement or any of the other
Loan Documents.
(k) Insurance. The Borrower shall have delivered to the Agent
evidence of the insurance required under the Loan Documents.
(l) Financial Model. The Borrower shall have delivered to the Agent
a three-year financial model for the Borrower and its Subsidiaries on a
consolidated basis, which model shall include an income statement, balance
sheet, statement of cash flows and assumptions.
(m) Existing Indebtedness; Payoff Letters. Concurrently with the
transactions contemplated hereby, (i) that Credit Agreement, dated as of August
13, 1999, among Borrower, the lenders party thereto, Citicorp USA, Inc., as
syndication agent, and JPMorgan Chase Bank (formerly known as Xxxxxx Guaranty
Trust Company of New York), as amended, modified, or supplemented to the date
hereof and (ii) those credit facilities between Borrower or any one or more Loan
Parties and Fifth Third Bank or The Huntington National Bank (to the extent not
permitted by the terms of Section 7.02(a)), shall have been terminated and the
Borrower shall have delivered to the Agent payoff letters executed by the
affected Lenders acknowledging such termination.
(n) No Disruption of Financial or Capital Markets. There shall have
been no material adverse change in the syndication markets for credit facilities
similar in nature to the credit facility governed hereby, and there shall not
have occurred and be continuing a material disruption of or material adverse
change in the financial, banking or capital markets that would have an adverse
effect on such syndication market, in each case as determined by the Agent in
its sole discretion.
Section 6.02 Each Additional Loan or Letter of Credit. At the time of
making any Loans or issuing any Letters of Credit other than Loans made or
Letters of Credit issued on the Closing Date and after giving effect to the
proposed extensions of credit: the representations and warranties of the Loan
Parties contained in Article V and in the other Loan Documents shall be true on
and as of the date of
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such additional Loan or Letter of Credit with the same effect as though such
representations and warranties had been made on and as of such date (except
representations and warranties which expressly relate solely to an earlier date
or time, which representations and warranties shall be true and correct on and
as of the specific dates or times referred to therein) and the Loan Parties
shall have performed and complied with all covenants and conditions hereof; no
Event of Default or Potential Default shall have occurred and be continuing or
shall exist; the making of the Loans or issuance of such Letter of Credit shall
not contravene any Law applicable to any Loan Party or Subsidiary of any Loan
Party or any of the Lenders; the Borrower shall have delivered to the Agent a
duly executed and completed Loan Request or application for a Letter of Credit
as the case may be; and the Loan Parties shall have delivered to the Agent for
the benefit of the Lenders duly executed and completed Security Documents, and
such Ancillary Security Documents as are appropriate at such time, to the extent
not previously provided. Each Loan Request and application for a Letter of
Credit submitted by Borrower shall be deemed to be a representation and warranty
that the conditions specified in this Section 6.02 have been satisfied on and as
of the date of the applicable Loan Request or application for Letter of Credit.
ARTICLE VII COVENANTS
Section 7.01 Affirmative Covenants. The Loan Parties, jointly and
severally, covenant and agree that until payment in full of the Loans,
Reimbursement Obligations and Letter of Credit Borrowings, and interest thereon,
expiration or termination of all Letters of Credit, satisfaction of all of the
Loan Parties' other Obligations under the Loan Documents and termination of the
Commitments, the Loan Parties shall comply at all times with the following
affirmative covenants:
(a) Preservation of Existence, Etc. Each Loan Party shall, and shall
cause each of its Subsidiaries to, maintain its legal existence as a
corporation, limited partnership or limited liability company and its license or
qualification and good standing in each jurisdiction in which its ownership or
lease of property or the nature of its business makes such license or
qualification necessary, except as otherwise expressly permitted in Section
7.02(e) [Liquidations, Mergers, Etc.].
(b) Payment of Liabilities, Including Taxes, Etc. Each Loan Party
shall, and shall cause each of its Subsidiaries to, duly pay and discharge all
liabilities to which it is subject or which are asserted against it, promptly as
and when the same shall become due and payable, including all taxes, assessments
and governmental charges upon it or any of its properties, assets, income or
profits, prior to the date on which penalties attach thereto, except to the
extent that the obligor with respect to such liabilities (other than taxes) has
accepted a surety bond with respect thereto in consideration of not pursuing
such liability against the relevant Loan Party or except to the extent that all
such liabilities, including taxes, assessments or charges, are being contested
in good faith and by appropriate and lawful proceedings diligently conducted and
for which such reserve or other appropriate provisions, if any, as shall be
required by GAAP shall have been made, but in any case only to the extent that
failure to discharge any such liabilities would not result in any additional
liability which would adversely affect to a material extent the financial
condition of any Loan Party or Subsidiary of any Loan Party, provided that the
Loan Parties and their Subsidiaries will pay all such liabilities forthwith upon
the commencement of proceedings to foreclose any Lien which may have attached as
security therefor.
(c) Maintenance of Insurance. Each Loan Party shall, and shall cause
each of its Subsidiaries to, insure its properties and assets against loss or
damage by fire and such other insurable hazards as such assets are commonly
insured (including fire, extended coverage, property damage, workers'
compensation, public liability and business interruption insurance) and against
other risks (including errors and omissions) in such amounts as similar
properties and assets are insured by prudent
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companies in similar circumstances carrying on similar businesses, and with
reputable and financially sound insurers, including self-insurance to the extent
customary, all as reasonably determined by the Agent.
(d) Maintenance of Properties and Leases. Each Loan Party shall, and
shall cause each of its Subsidiaries to, maintain in good repair, working order
and condition (ordinary wear and tear excepted) in accordance with the general
practice of other businesses of similar character and size, all of those
properties useful or necessary to its business, and from time to time, such Loan
Party will make or cause to be made all appropriate repairs, renewals or
replacements thereof.
(e) Maintenance of Patents, Trademarks, Etc. Each Loan Party shall,
and shall cause each of its Subsidiaries to, maintain in full force and effect
all patents, trademarks, service marks, trade names, copyrights, licenses,
franchises, permits and other authorizations necessary for the ownership and
operation of its properties and business if the failure so to maintain the same
would constitute a Material Adverse Change.
(f) Visitation Rights. Each Loan Party shall, and shall cause each
of its Subsidiaries to, permit any of the officers or authorized employees or
representatives of the Agent or any of the Lenders to visit and inspect any of
its properties and to examine and make excerpts from its books and records and
discuss its business affairs, finances and accounts with its officers, all in
such detail and at such times and as often as any of the Lenders may reasonably
request, provided that each Lender shall provide the Borrower and the Agent with
reasonable notice prior to any visit or inspection. In the event any Lender
desires to conduct an audit of any Loan Party, such Lender shall make a
reasonable effort to conduct such audit contemporaneously with any audit to be
performed by the Agent.
(g) Keeping of Records and Books of Account. The Borrower shall, and
shall cause each Subsidiary of the Borrower to, maintain and keep proper books
of record and account which enable the Borrower and its Subsidiaries to issue
financial statements in accordance with GAAP and as otherwise required by
applicable Laws of any Official Body having jurisdiction over the Borrower or
any Subsidiary of the Borrower, and in which full, true and correct entries
shall be made in all material respects of all its dealings and business and
financial affairs.
(h) Plans and Benefit Arrangements. The Borrower shall, and shall
cause each other member of the ERISA Group to, comply with ERISA, the Internal
Revenue Code and other applicable Laws applicable to Plans and Benefit
Arrangements except where such failure, alone or in conjunction with any other
failure, would not result in a Material Adverse Change. Without limiting the
generality of the foregoing, the Borrower shall cause all of its Plans and all
Plans maintained by any member of the ERISA Group to be funded in accordance
with the minimum funding requirements of ERISA and shall make, and cause each
member of the ERISA Group to make, in a timely manner, all contributions due to
Plans, Benefit Arrangements and Multiemployer Plans.
(i) Compliance With Laws. Each Loan Party shall, and shall cause
each of its Subsidiaries to, comply with all applicable Laws, including all
Environmental Laws and Safety Laws, in all respects, provided that it shall not
be deemed to be a violation of this Section 7.01(i) if any failure to comply
with any Law would not result in fines, penalties, costs associated with the
performance of any Remedial Actions, other similar liabilities or injunctive
relief which in the aggregate would constitute a Material Adverse Change.
Without limiting the generality of the foregoing, each Loan Party shall, and
shall cause each of its Subsidiaries to, obtain, maintain, renew and comply with
all Environmental Permits applicable to their respective operations and
activities, provided that it shall not be deemed to be
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a violation of this Section 7.01(i) if any failure to do so would not result in
cease and desist orders or fines, penalties or other similar liabilities or
injunctive relief which in the aggregate would constitute a Material Adverse
Change.
(j) Use of Proceeds. The Loan Parties will use the Letters of Credit
and the proceeds of the Loans only for (i) general corporate purposes, working
capital and letters of credit, and (ii) capital expenditures. The Loan Parties
shall not use the Letters of Credit or the proceeds of the Loans for any
purposes which contravenes any applicable Law or any provision hereof.
(k) Liens, Ancillary Security Documents. Upon the occurrence and
continuation of an Event of Default, all Security Documents shall without any
act or consent of any Loan Party become and thereafter be deemed irrevocably
effective (subject to the proviso of Section 6.01(c)), whereupon any and all
actions of the Agent necessary to make such Liens effective as between any Loan
Party and the Agent on behalf of the Lenders or as to any third party (including
the filing of UCC financing statements) are hereby authorized by each Loan Party
at the joint and several expense of the Loan Parties. The Loan Parties shall
provide to Agent for the benefit of the Lenders any additional Security
Documents deemed advisable by Agent and shall provide all Ancillary Security
Documents to Agent for the benefit of the Lenders, all at the joint and several
cost and expense of the Loan Parties.
Section 7.02 Negative Covenants. The Loan Parties, jointly and severally,
covenant and agree that until payment in full of the Loans, Reimbursement
Obligations and Letter of Credit Borrowings and interest thereon, expiration or
termination of all Letters of Credit, satisfaction of all of the Loan Parties'
other Obligations hereunder and termination of the Commitments, the Loan Parties
shall comply with the following negative covenants:
(a) Indebtedness. Each of the Loan Parties shall not, and shall not
permit any of its Subsidiaries to, at any time create, incur, assume or suffer
to exist any Indebtedness, except:
(i) Indebtedness under the Loan Documents;
(ii) Existing Indebtedness as set forth on Schedule 7.02(A)
(including any extensions or renewals thereof, provided there is no increase in
the amount thereof or other significant change in the terms thereof unless
otherwise specified on Schedule 7.02(A);
(iii) Indebtedness (not otherwise set forth on Schedule
7.02(A)) secured by Purchase Money Security Interests to the extent permitted by
Section 7.02(b);
(iv) Indebtedness of a Loan Party to another Loan Party, and
Indebtedness owing to a Loan Party by an Offshore Subsidiaries or by a
Subsidiary engaged in the retail sale of goods in Puerto Rico, provided that the
aggregate amount provided by all Loan Parties of all investments in, loans or
advances to, and other capitalization of any nature of all Offshore Subsidiaries
and of all Subsidiaries engaged in the retail sale of goods in Puerto Rico shall
not exceed $5,000,000;
(v) Any Lender-Provided Interest Rate Hedge or other Interest
Rate Hedge approved by the Agent;
(vi) Credit facilities in favor of Offshore Subsidiaries
denominated in U.S. Dollars granted by one or more Lenders, in a maximum
aggregate amount not to exceed 5.0% of Consolidated Tangible Net Worth, provided
that each such credit facility is supported on a dollar for
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dollar basis by Letters of Credit, and provided, further, that all such credit
facilities shall be solely for the issuance of letters of credit for the account
of one or more Offshore Subsidiaries for use by such Offshore Subsidiaries in
the purchase outside the United States of goods to be sold to a Loan Party for
the resale thereof by a Loan Party at its retail locations; and
(vii) Other Indebtedness of the Loan Parties plus the amount
of Indebtedness of Offshore Subsidiaries and Subsidiaries engaged in the retail
sale of goods in Puerto Rico permitted pursuant to Clause (vi) directly above in
an aggregate amount not to exceed 10.0% of Consolidated Tangible Net Worth, but
in no event may any such other Indebtedness permitted by this Clause (vii) be
comprised of any facility or obligation providing or relating to letters of
credit other than as set forth in Clause (vi) directly above.
(b) Liens. Each of the Loan Parties shall not, and shall not permit
any of its Subsidiaries to, at any time (i) create, incur, assume or suffer to
exist any Lien (including any lien or other encumbrance authorized by
Environmental Laws) on any of its property or assets, tangible or intangible,
now owned or hereafter acquired, or agree or become liable to do so, except
Permitted Liens or (ii) directly or indirectly, enter into any agreement,
understanding or other arrangement with any other Person which purports to
prohibit or limit in any manner the ability of any Loan Party to create or
permit to exist any security interest, mortgage, pledge, lien, or other
encumbrance on or against any of this property or assets except in favor of the
Agent for the benefit of the Lenders.
(c) Guaranties. Each of the Loan Parties shall not, and shall not
permit any of its Subsidiaries to, at any time, directly or indirectly, become
or be liable in respect of any Guaranty, or assume, guarantee, become surety
for, endorse or otherwise agree, become or remain directly or contingently
liable upon or with respect to any obligation or liability of any other Person,
except for Guaranties of Indebtedness of the Loan Parties permitted hereunder
and except for endorsements of negotiable or other instruments for deposit or
collection in the ordinary course of business and except for Letters of Credit
issued in support of credit facilities permitted in favor of Offshore
Subsidiaries pursuant to Section 7.02(a)(vi).
(d) Loans and Investments. Each of the Loan Parties shall not, and
shall not permit any of its Subsidiaries to, at any time make or suffer to
remain outstanding any loan or advance to, or purchase, acquire or own any
stock, bonds, notes or securities of, or any partnership interest (whether
general or limited) or limited liability company interest in, or any other
investment or interest in, or make any capital contribution to, any other
Person, or agree, become or remain liable to do any of the foregoing, except:
(i) trade credit extended on usual and customary terms in the
ordinary course of business;
(ii) advances to employees to meet expenses incurred by such
employees in the ordinary course of business;
(iii) loans, advances and investments in other Loan Parties;
and, loans, advances, and investments in Offshore Subsidiaries, in Subsidiaries
engaged in the retail sale of goods in Puerto Rico and in that joint venture
doing business as "Goldmark," in each case to the extent permitted by Section
7.02(h); and
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loans, advances and investments made in accordance with the investment policy of
Borrower set forth on Schedule 7.02(D) (the "Investment Policy"), as such
Investment Policy is amended from time to time upon the written consent of the
Required Lenders thereto. Such consent of the Required Lenders shall not be
unreasonably withheld and, upon the written request of Borrower provided to
Agent and the Lenders, Borrower may request such consent of the Required Lenders
and the Lenders and Agent agree to endeavor, in good faith, to consider such
request in light of the then applicable and projected financial condition of the
Loan Parties as a whole, the condition of the capital markets generally and
general considerations of safety and soundness.
(e) Liquidations, Mergers, Consolidations, Acquisitions. Each of the
Loan Parties shall not, and shall not permit any of its Subsidiaries to,
dissolve, liquidate or wind-up its affairs, or become a party to any merger or
consolidation, or acquire by purchase, lease or otherwise all or substantially
all of the assets or capital stock of any other Person, provided that
(i) any Loan Party other than the Borrower may consolidate or
merge into another Loan Party which is wholly-owned by one or more of the other
Loan Parties, and
(ii) any Loan Party may acquire, whether by purchase or by
merger, (A) all of the ownership interests of another Person or (B)
substantially all of assets of another Person or of a business or division of
another Person (each an "Permitted Acquisition"), provided that each of the
following requirements is met:
(A) if the Loan Parties are acquiring the ownership
interests in such Person, such Person shall execute a Guarantor Joinder and join
this Agreement as a Guarantor pursuant to Section 10.18 [Joinder of Guarantors]
on or before the date of such Permitted Acquisition;
(B) the Loan Parties, such Person and its owners, as
applicable, shall comply with Section 10.18 [Joinder of Guarantors] on or before
the date of such Permitted Acquisition;
(C) the board of directors or other equivalent governing
body of such Person shall have approved such Permitted Acquisition and, if the
Loan Parties shall use any portion of the Loans to fund such Permitted
Acquisition, the Loan Parties also shall have delivered to the Lenders written
evidence of the approval of the board of directors (or equivalent body) of such
Person for such Permitted Acquisition;
(D) the business acquired, or the business conducted by
the Person whose ownership interests are being acquired, as applicable, shall be
substantially the same as one or more line or lines of business conducted by the
Loan Parties and shall comply with Section 7.02(i) [Continuation of or Change in
Business];
(E) no Potential Default or Event of Default shall exist
immediately prior to and after giving effect to such Permitted Acquisition;
(F) the Borrower shall demonstrate that it shall be in
compliance with the covenants contained in Sections 7.02(m), 7.02(n), and
7.02(o) [financial covenants] after giving effect to such Permitted Acquisition
(including in such computation Indebtedness or other liabilities assumed or
incurred in connection with such Permitted Acquisition but excluding income
earned or expenses incurred by the Person, business or assets to be acquired
prior to the date of such Permitted
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Acquisition) by delivering at least thirty (30) Business Days prior to such
Permitted Acquisition a certificate in the form of Exhibit 7.02(E) evidencing
such compliance;
(G) the aggregate Consideration paid or to be paid by
the Loan Parties for all Permitted Acquisitions made through the date of any
Permitted Acquisition shall not exceed an amount equal to ten (10%) of
Consolidated Tangible Net Worth at the time of any such Permitted Acquisition or
proposed Permitted Acquisition; and
(H) upon request of any Lender, the Loan Parties shall
deliver to the Agent and such Lender at least thirty (30) Business Days before
such Permitted Acquisition copies of any agreements entered into or proposed to
be entered into by such Loan Parties in connection with such Permitted
Acquisition (together with revisions thereof and the final agreements with
respect thereto) and shall deliver to the Agent and such Lender such other
information about such Person or its assets as any Loan Party may reasonably
require.
(f) Dispositions of Assets or Subsidiaries. Each of the Loan Parties
shall not, and shall not permit any of its Subsidiaries to, sell, convey,
assign, lease, abandon or otherwise transfer or dispose of, voluntarily or
involuntarily, any of its properties or assets, tangible or intangible
(including sale, assignment, discount or other disposition of accounts, contract
rights, chattel paper, equipment or general intangibles with or without recourse
or of capital stock, shares of beneficial interest, partnership interests or
limited liability company interests of a Subsidiary of such Loan Party and
including Sale-Leasebacks), except:
(i) transactions involving the sale of inventory in the
ordinary course of business;
(ii) any sale, transfer or lease of assets in the ordinary
course of business which are no longer necessary or required in the conduct of
such Loan Party's or such Subsidiary's business;
(iii) any sale, transfer or lease of assets by any wholly
owned Subsidiary of such Loan Party to another Loan Party;
(iv) any sale, transfer or lease of assets in the ordinary
course of business which are replaced by substitute assets acquired or leased;
(v) any sale, transfer or lease of assets, other than those
specifically excepted pursuant to clauses (i) through (iv) above, provided that
(A) at the time of any disposition, no Event of Default shall exist or shall
result from such disposition, and (B) the aggregate value of all assets so sold
by the Loan Parties and their Subsidiaries shall not exceed in any fiscal year
$15,000,000.
(g) Affiliate Transactions. Each of the Loan Parties shall not, and
shall not permit any of its Subsidiaries to, enter into or carry out any
transaction (including purchasing property or services from or selling property
or services to any Affiliate of any Loan Party or other Person) unless such
transaction is entered into in the ordinary course of business upon fair and
reasonable arm's-length terms and conditions which are fully disclosed to the
Agent and is in accordance with all applicable Law.
(h) Subsidiaries, Partnerships and Joint Ventures. Each of the Loan
Parties shall not, and shall not permit any of its Subsidiaries to, own or
create directly or indirectly any Subsidiaries other
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than (i) any Subsidiary which has joined this Agreement as Guarantor on the
Closing Date; and (ii) any Subsidiary formed after the Closing Date which joins
this Agreement as a Guarantor pursuant to Section 10.18 [Joinder of Guarantors];
provided, however, that the Loan Parties may own Offshore Subsidiaries and
Subsidiaries engaged in the retail sale of goods in Puerto Rico and such
Offshore Subsidiaries and Puerto Rican Subsidiaries shall not be subject to the
requirements of Subclauses (i) and (ii) directly above, and provided further
that the aggregate amount provided by the Loan Parties of all investments in,
loans or advances to, and other capitalization of any nature of all Offshore
Subsidiaries and of such Subsidiaries engaged in the retail sale of goods in
Puerto Rico shall not exceed $5,000,000. Each of the Loan Parties shall not
become or agree to (1) become a general or limited partner in any general or
limited partnership, except that the Loan Parties may be general or limited
partners in other Loan Parties, (2) become a member or manager of, or hold a
limited liability company interest in, a limited liability company, except that
the Loan Parties may be members or managers of, or hold limited liability
company interests in, other Loan Parties, or (3) become a joint venturer or hold
a joint venture interest in any joint venture except that the Loan Parties may
make loans, advances and investments to or in G Too, LLC, a joint venture
between Borrower and Angus & Coote Holdings Ltd. (such joint venture doing
business as "Goldmark") in an aggregate amount not to exceed the following
respective maximum amount during the corresponding period set forth below:
PERIOD: MAXIMUM AMOUNT:
Closing Date to the First Anniversary of
Closing Date $4,000,000
First Anniversary of Closing Date to the Second
Anniversary of Closing Date $6,000,000
Second Anniversary of Closing Date to the Third
Anniversary of Closing Date $8,000,000
(i) Dividends and Restricted Payments. Each of the Loan Parties
shall not, and shall not permit any of its Subsidiaries to, make or pay, or
agree to become or remain liable to make or pay, any dividend or other
distribution of any nature (whether in cash, property, securities or otherwise)
on account of or in respect of its shares of capital stock, partnership
interests or limited liability company interests or on account of the purchase,
redemption, retirement or acquisition of its shares of capital stock (or
warrants, options or rights therefor), partnership interests or limited
liability company interests, except
(i) dividends or other distributions payable to another Loan
Party,
(ii) dividends other than those described in clause (i),
provided the aggregate amount of such dividend to be paid by any Loan Party or
Subsidiary of any Loan Party in any given fiscal year shall not exceed twenty
percent (20%) of the reported fiscal year net earnings of such Loan Party or
Subsidiary for such fiscal year, and
(iii) redemptions of its shares of capital stock (or warrants,
options or rights therefor), partnership interests or limited liability company
interests provided the aggregate amount of
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such redemptions shall not exceed thirty percent (30%) of the reported fiscal
year net earnings of such Loan Party or Subsidiary for such fiscal year.
(j) Continuation of or Change in Business. Each of the Loan Parties
shall not, and shall not permit any of its Subsidiaries to, engage in any
business other than the business conducted by the Loan Parties as of the Closing
Date, and such Loan Party or Subsidiary shall not permit any material change in
such business.
(k) Plans and Benefit Arrangements. Each of the Loan Parties shall
not, and shall not permit any of its Subsidiaries to engage in a Prohibited
Transaction with any Plan, Benefit Arrangement or Multiemployer Plan which,
alone or in conjunction with any other circumstances or set of circumstances
resulting in liability under ERISA or otherwise violate ERISA:
(l) Fiscal Year. The Borrower shall not, and shall not permit any
Subsidiary of the Borrower to, change its fiscal year from the twelve-month
period ending on that Saturday nearest to the last Business Day of January of
each calendar year.
(m) Maximum Leverage Ratio. The Loan Parties shall not permit the
Leverage Ratio to exceed 3.0 to 1.0.
(n) Minimum Coverage Ratio. The Loan Parties shall not permit the
Coverage Ratio to be less than 2.5 to 1.0.
(o) Minimum Tangible Net Worth. The Borrower shall not at any time
permit Consolidated Tangible Net Worth to be less than Base Net Worth.
(p) Sale and Leaseback. Each of the Loan Parties shall not, and
shall not permit any of its Subsidiaries to, enter into any arrangement,
directly or indirectly, with any Person whereby it shall sell or transfer any
property, whether real or personal, used or useful in its business, whether now
owned or hereafter acquired, if such Loan Party or Subsidiary at the time of
such sale or disposition intends to lease or otherwise acquire the right to use
or possess (except by purchase) such property or like property for a
substantially similar purpose (each a "Sale-Leaseback") except that the Loan
Parties may enter into a Sale-Leaseback the transfer or sale aspect of which is
in compliance with Section 7.02(f) and all Sale-Leasebacks shall be subject to
Section 7.02(a) and Section 7.02(b) and the Loan Parties acknowledge and agree
that the sale aspect of any such Sale-Leaseback shall be subject to the
mandatory prepayment requirements of Section 4.05(a) (including the threshold
requirements of the definition of Significant Asset Sale).
Section 7.03 Reporting Requirements. The Loan Parties, jointly and
severally, covenant and agree that until payment in full of the Loans,
Reimbursement Obligations and Letter of Credit Borrowings and interest thereon,
expiration or termination of all Letters of Credit, satisfaction of all of the
Loan Parties' other Obligations hereunder and under the other Loan Documents and
termination of the Commitments, the Loan Parties will furnish or cause to be
furnished to the Agent and each of the Lenders:
(a) Quarterly Financial Statements. As soon as available and in any
event within forty-five (45) calendar days after the end of each of the first
three fiscal quarters in each fiscal year, financial statements of the Borrower,
consisting of a consolidated balance sheet as of the end of such fiscal quarter
and related consolidated statements of income, retained earnings, stockholders'
equity and cash flows for
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for the fiscal quarter then ended and the fiscal year through that date, all in
reasonable detail and certified (subject to normal year-end audit adjustments)
by the Chief Executive Officer, President or Chief Financial Officer of the
Borrower as having been prepared in accordance with GAAP, consistently applied,
and setting forth in comparative form the respective financial statements for
the corresponding date and period in the previous fiscal year. The Loan Parties
will be deemed to have complied with the delivery requirements of this Section
7.03(a) if within forty-five (45) days after the end of their fiscal quarter,
the Borrower delivers to the Agent and each of the Lenders a copy of its Form
10-Q as filed with the SEC and the financial statements contained therein meets
the requirements described in this Section.
(b) Annual Financial Statements. As soon as available and in any
event within ninety (90) days after the end of each fiscal year of the Borrower,
financial statements of the Borrower consisting of a consolidated and
consolidating balance sheet as of the end of such fiscal year, and related
consolidated and consolidating statements of income, retained earnings,
stockholders' equity and cash flows for the fiscal year then ended, all in
reasonable detail and setting forth in comparative form the financial statements
as of the end of and for the preceding fiscal year, and certified by independent
certified public accountants of nationally recognized standing satisfactory to
the Agent (for the avoidance of doubt, those certified public accounting firms
conducting business under the names listed on Schedule 7.03(B) are satisfactory
to Agent absent a determination by and written notice from the Agent to Borrower
to the contrary, which determination shall not be unreasonably made; and, Agent
will provide to Borrower an update to Schedule 7.03(B) on an annual basis). The
certificate or report of accountants shall be free of qualifications (other than
any consistency qualification that may result from a change in the method used
to prepare the financial statements as to which such accountants concur) and
shall not indicate the occurrence or existence of any event, condition or
contingency which would materially impair the prospect of payment or performance
of any covenant, agreement or duty of any Loan Party under any of the Loan
Documents. The Loan Parties will be deemed to have complied with the delivery
requirements of this Section 7.03(b) if within ninety (90) days after the end of
their fiscal year, the Borrower delivers to the Agent and each of the Lenders a
copy of its Annual Report and Form 10-K as filed with the SEC and the financial
statements and certification of public accountants contained therein meets the
requirements described in this Section.
(c) Certificate of the Borrower. Concurrently with the financial
statements of the Borrower furnished to the Agent and to the Lenders pursuant to
Section 7.03(a) [Quarterly Financial Statements] and Section 7.03(b) [Annual
Financial Statements], a certificate (each a "Compliance Certificate") of the
Borrower signed by the Chief Executive Officer, President or Chief Financial
Officer of the Borrower, in the form of Exhibit 7.03(C), to the effect that,
except as described pursuant to Section 7.03(d) [Notice of Default], (i) the
representations and warranties of the Borrower contained in Article V and in the
other Loan Documents are true on and as of the date of such certificate with the
same effect as though such representations and warranties had been made on and
as of such date (except representations and warranties which expressly relate
solely to an earlier date or time) and the Loan Parties have performed and
complied with all covenants and conditions hereof, (ii) no Event of Default or
Potential Default exists and is continuing on the date of such certificate and
(iii) containing calculations in sufficient detail to demonstrate compliance as
of the date of such financial statements with all financial covenants contained
in Section 7.02 [Negative Covenants].
(d) Notice of Default. Promptly after any Loan Party has learned of
the occurrence of an Event of Default or Potential Default, a certificate signed
by the Chief Executive Officer, President or Chief Financial Officer of such
Loan Party setting forth the details of such Event of Default or Potential
Default and the action which the such Loan Party proposes to take with respect
thereto.
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(e) Notice of Litigation. Promptly after the commencement thereof,
notice of all (i) actions, suits, proceedings or investigations before or by any
Official Body or any other Person against any Loan Party or Subsidiary of any
Loan Party, or (ii) Environmental Complaint, which individually or in the
aggregate with respect to either (i) or (ii) if adversely determined would
constitute a Material Adverse Change.
(f) Sale of Assets. At least thirty (30) days prior thereto, with
respect to any proposed sale or transfer of assets pursuant to Section
7.02(f)(v).
(g) Budgets, Forecasts, Other Reports and Information. Promptly upon
their becoming available to the Borrower:
(i) the annual budget and three-year forecasts or projections
of the Borrower, to be supplied not later than twenty (20) days after the
commencement of the fiscal year to which any of the foregoing may be applicable,
(ii) any reports including management letters submitted to the
Borrower by independent accountants in connection with any annual, interim or
special audit,
(iii) any reports, notices or proxy statements generally
distributed by the Borrower to its stockholders on a date no later than the date
supplied to such stockholders,
(iv) regular or periodic reports, including Forms 10-K, 10-Q
and 8-K, registration statements and prospectuses, filed by the Borrower with
the SEC,
(v) such other reports and information as any of the Lenders
may from time to time reasonably request. The Borrower shall also notify the
Lenders promptly of the enactment or adoption of any Law which may result in a
Material Adverse Change.
(h) Notices Regarding Plans and Benefit Arrangements.
(i) Certain Events. Promptly upon becoming aware of the
occurrence thereof, notice (including the nature of the event and, when known,
any action taken or threatened by the Internal Revenue Service or the PBGC with
respect thereto) of:
(A) any Reportable Event with respect to the Borrower or
any other member of the ERISA Group (regardless of whether the obligation to
report said Reportable Event to the PBGC has been waived),
(B) any Prohibited Transaction which could subject the
Borrower or any other member of the ERISA Group to a civil penalty assessed
pursuant to Section 502(i) of ERISA or a tax imposed by Section 4975 of the
Internal Revenue Code in connection with any Plan, any Benefit Arrangement or
any trust created thereunder,
(C) any assertion of material withdrawal liability with
respect to any Multiemployer Plan,
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(D) any partial or complete withdrawal from a
Multiemployer Plan by the Borrower or any other member of the ERISA Group under
Title IV of ERISA (or assertion thereof), where such withdrawal is likely to
result in material withdrawal liability,
(E) any cessation of operations (by the Borrower or any
other member of the ERISA Group) at a facility in the circumstances described in
Section 4062(e) of ERISA,
(F) withdrawal by the Borrower or any other member of
the ERISA Group from a Multiple Employer Plan,
(G) a failure by the Borrower or any other member of the
ERISA Group to make a payment to a Plan required to avoid imposition of a Lien
under Section 302(f) of ERISA,
(H) the adoption of an amendment to a Plan requiring the
provision of security to such Plan pursuant to Section 307 of ERISA, or
(I) any change in the actuarial assumptions or funding
methods used for any Plan, where the effect of such change is to materially
increase or materially reduce the unfunded benefit liability or obligation to
make periodic contributions.
(ii) Notices of Involuntary Termination and Annual Reports.
Promptly after receipt thereof, copies of (a) all notices received by the
Borrower or any other member of the ERISA Group of the PBGC's intent to
terminate any Plan administered or maintained by the Borrower or any member of
the ERISA Group, or to have a trustee appointed to administer any such Plan; and
(b) at the request of the Agent or any Lender each annual report (IRS Form 5500
series) and all accompanying schedules, the most recent actuarial reports, the
most recent financial information concerning the financial status of each Plan
administered or maintained by the Borrower or any other member of the ERISA
Group, and schedules showing the amounts contributed to each such Plan by or on
behalf of the Borrower or any other member of the ERISA Group in which any of
their personnel participate or from which such personnel may derive a benefit,
and each Schedule B (Actuarial Information) to the annual report filed by the
Borrower or any other member of the ERISA Group with the Internal Revenue
Service with respect to each such Plan.
(iii) Notice of Voluntary Termination. Promptly upon the
filing thereof, copies of any Form 5310, or any successor or equivalent form to
Form 5310, filed with the PBGC in connection with the termination of any Plan.
(i) Tax Shelter Notice. Borrower shall notify Agent and the Lenders
at any time that Borrower or any Loan Party intends to treat any Loan or Letter
of Credit or any related transaction as or as a part of a "reportable
transaction" (within the meaning of Treasury Regulation Section 1.6011-4, as
amended from time to time). Promptly after the Borrower or a Loan Party has
provided such notice, Borrower shall provide a duly completed copy of IRS Form
8886 or any successor form to Agent and to any Lender that may make a request
therefore. Borrower acknowledges that one or more of the Lenders may treat its
Loans or Letters of Credit as part of a transaction that is subject to Treasury
Regulation Section 301.6112-1, and such Lender or Lenders, as applicable, may
maintain the lists and other records required by such Treasury Regulation.
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ARTICLE VIII EVENTS OF DEFAULT
Section 8.01 Events of Default. An "Event of Default" shall mean the
occurrence or existence of any one or more of the following events or conditions
(whatever the reason therefor and whether voluntary, involuntary or effected by
operation of Law):
(a) Payments Under Loan Documents. The Borrower shall fail to pay
(i) any principal of or interest on any Loan (including scheduled installments,
mandatory prepayments or the payment due at maturity), Reimbursement Obligation
or Letter of Credit Borrowing when such principal or interest is due hereunder,
or (ii) any Facility Fee, Utilization Fee, or other fee owing to a Lender, an
Issuing Bank, or the Agent hereunder or under any other Loan Document within
three (3) days after such fee becomes due hereunder or thereunder;
(b) Breach of Warranty. Any representation or warranty made at any
time by any of the Loan Parties herein or by any of the Loan Parties in any
other Loan Document, or in any certificate, other instrument or statement
furnished pursuant to the provisions hereof or thereof, shall prove to have been
false or misleading in any material respect as of the time it was made or
furnished;
(c) Breach of Negative Covenants or Visitation Rights. Any of the
Loan Parties shall default in the observance or performance of any covenant
contained in Section 7.01(f) [Visitation Rights] or Section 7.02 [Negative
Covenants];
(d) Breach of Other Covenants. Any of the Loan Parties shall default
in the observance or performance of any other covenant, condition or provision
hereof or of any other Loan Document and such default shall continue unremedied
for a period of five (5) Business Days after any officer of any Loan Party
becomes aware of the occurrence thereof (such grace period to be applicable only
in the event such default can be remedied by corrective action of the Loan
Parties as determined by the Agent in its sole discretion);
(e) Defaults in Other Agreements or Indebtedness. A default or event
of default shall occur at any time under the terms of any other agreement
involving borrowed money or the extension of credit or any other Indebtedness
under which any Loan Party or Subsidiary of any Loan Party may be obligated as a
borrower or guarantor in excess of $2,500,000 in the aggregate, and such breach,
default or event of default consists of the failure to pay (beyond any period of
grace permitted with respect thereto, whether waived or not) any indebtedness
when due (whether at stated maturity, by acceleration or otherwise) or if such
breach or default permits or causes the acceleration of any indebtedness
(whether or not such right shall have been waived) or the termination of any
commitment to lend;
(f) Final Judgments or Orders. Any final judgments or orders
including final judgments or orders rendered with respect to any Environmental
Complaints or Safety Complaints for the payment of money in excess of $1,000,000
in the aggregate shall be entered against any Loan Party by a court having
jurisdiction in the premises, which judgment is not discharged, vacated, bonded
or stayed pending appeal within a period of thirty (30) days from the date of
entry;
(g) Loan Document Unenforceable. Any of the Loan Documents shall
cease to be legal, valid and binding agreements enforceable against the party
executing the same or such party's successors and assigns (as permitted under
the Loan Documents) in accordance with the respective terms thereof or shall in
any way be terminated (except in accordance with its terms) or become or be
declared ineffective or inoperative or shall in any way be challenged or
contested or cease to give or provide the respective
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Liens, security interests, rights, titles, interests, remedies, powers or
privileges intended to be created thereby;
(h) Uninsured Losses; Proceedings Against Assets. Any of the Loan
Parties' or any of their Subsidiaries' assets are attached, seized, levied upon
or subjected to a writ or distress warrant; or such come within the possession
of any receiver, trustee, custodian or assignee for the benefit of creditors and
the same is not cured within thirty (30) days thereafter;
(i) Notice of Lien or Assessment. A notice of Lien or assessment in
excess of $1,000,000 which is not a Permitted Lien or Environmental Complaint in
excess of $1,000,000, in either case is filed of record with respect to all or
any part of any of the Loan Parties' or any of their Subsidiaries' assets by the
United States, or any department, agency or instrumentality thereof, or by any
state, county, municipal or other governmental agency, including the PBGC, or
any taxes or debts owing at any time or times hereafter to any one of these
becomes payable and the same is not paid within thirty (30) days after the same
becomes payable;
(j) Insolvency. Any Loan Party or any Subsidiary of a Loan Party
ceases to be solvent or admits in writing its inability to pay its debts as they
mature;
(k) Events Relating to Plans and Benefit Arrangements. Any of the
following occurs: (i) any Reportable Event, which the Agent determines in good
faith constitutes grounds for the termination of any Plan by the PBGC or the
appointment of a trustee to administer or liquidate any Plan, shall have
occurred and be continuing; (ii) proceedings shall have been instituted or other
action taken to terminate any Plan, or a termination notice shall have been
filed with respect to any Plan; (iii) a trustee shall be appointed to administer
or liquidate any Plan; (iv) the PBGC shall give notice of its intent to
institute proceedings to terminate any Plan or Plans or to appoint a trustee to
administer or liquidate any Plan; and, in the case of the occurrence of (i),
(ii), (iii) or (iv) above, the Agent determines in good faith that the amount of
the Borrower's liability is likely to exceed 10% of its Consolidated Tangible
Net Worth; (v) the Borrower or any member of the ERISA Group shall fail to make
any contributions when due to a Plan or a Multiemployer Plan; (vi) the Borrower
or any other member of the ERISA Group shall make any amendment to a Plan with
respect to which security is required under Section 307 of ERISA; (vii) the
Borrower or any other member of the ERISA Group shall withdraw completely or
partially from a Multiemployer Plan; (viii) the Borrower or any other member of
the ERISA Group shall withdraw (or shall be deemed under Section 4062(e) of
ERISA to withdraw) from a Multiple Employer Plan; or (ix) any applicable Law is
adopted, changed or interpreted by any Official Body with respect to or
otherwise affecting one or more Plans, Multiemployer Plans or Benefit
Arrangements and, with respect to any of the events specified in (v), (vi),
(vii), (viii) or (ix), the Agent determines in good faith that any such
occurrence would be reasonably likely to materially and adversely affect the
total enterprise represented by the Borrower and the other members of the ERISA
Group;
(l) Cessation of Business. Any Loan Party or Subsidiary of a Loan
Party ceases to conduct its business as contemplated, except as expressly
permitted under Section 7.02(e) [Liquidations, Mergers, Etc.] or Section
7.02(f), or any Loan Party or Subsidiary of a Loan Party is enjoined, restrained
or in any way prevented by court order from conducting all or any material part
of its business and such injunction, restraint or other preventive order is not
dismissed within thirty (30) days after the entry thereof;
(m) Change of Control. Any person or group of persons (within the
meaning of Sections 13(d) or 14(a) of the Securities Exchange Act of 1934, as
amended) shall have acquired
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beneficial ownership of (within the meaning of Rule 13d-3 promulgated by the SEC
under said Act) 30% or more of the voting capital stock of the Borrower; or (ii)
within a period of twelve (12) consecutive calendar months, individuals who were
directors of the Borrower on the first day of such period shall cease to
constitute a majority of the board of directors of the Borrower;
(n) Involuntary Proceedings. A proceeding shall have been instituted
in a court having jurisdiction in the premises seeking a decree or order for
relief in respect of any Loan Party or Subsidiary of a Loan Party in an
involuntary case under any applicable bankruptcy, insolvency, reorganization or
other similar law now or hereafter in effect, or for the appointment of a
receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator
(or similar official) of any Loan Party or Subsidiary of a Loan Party for any
substantial part of its property, or for the winding-up or liquidation of its
affairs, and such proceeding shall remain undismissed or unstayed and in effect
for a period of thirty (30) consecutive days or such court shall enter a decree
or order granting any of the relief sought in such proceeding; or
(o) Voluntary Proceedings. Any Loan Party or Subsidiary of a Loan
Party shall commence a voluntary case under any applicable bankruptcy,
insolvency, reorganization or other similar law now or hereafter in effect,
shall consent to the entry of an order for relief in an involuntary case under
any such law, or shall consent to the appointment or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator
(or other similar official) of itself or for any substantial part of its
property or shall make a general assignment for the benefit of creditors, or
shall fail generally to pay its debts as they become due, or shall take any
action in furtherance of any of the foregoing.
Section 8.02 Consequences of Event of Default.
(a) Events of Default Other Than Bankruptcy, Insolvency or
Reorganization Proceedings. If an Event of Default specified under Section
8.01(a) through (m) shall occur and be continuing, the Lenders and the Agent
shall be under no further obligation to make Loans or issue Letters of Credit,
as the case may be, and the Agent may, and upon the request of the Required
Lenders, shall (i) by written notice to the Borrower, declare the unpaid
principal amount of the Loans then outstanding and all interest accrued thereon,
any unpaid fees and all other Indebtedness of the Borrower to the Lenders
hereunder and thereunder to be forthwith due and payable, and the same shall
thereupon become and be immediately due and payable to the Agent for the benefit
of each Lender without presentment, demand, protest or any other notice of any
kind, all of which are hereby expressly waived, and (ii) require the Borrower
to, and the Borrower shall thereupon, deposit in a non-interest-bearing account
with the Agent, as cash collateral for its Obligations under the Loan Documents,
an amount equal to the maximum amount currently or at any time thereafter
available to be drawn on all outstanding Letters of Credit, and the Borrower
hereby pledges to the Agent and the Lenders, and grants to the Agent and the
Lenders a security interest in, all such cash as security for such Obligations.
Upon the curing of all existing Events of Default to the satisfaction of the
Required Lenders, the Agent shall return such cash collateral to the Borrower;
and
(b) Bankruptcy, Insolvency or Reorganization Proceedings. If an
Event of Default specified under Section 8.01(n) [Involuntary Proceedings] or
Section 8.01(o) [Voluntary Proceedings] shall occur, the Lenders shall be under
no further obligations to make Loans or issue Letters of Credit hereunder and
the unpaid principal amount of the Loans then outstanding and all interest
accrued thereon, any unpaid fees and all other Indebtedness of the Borrower to
the Lenders hereunder and thereunder shall be immediately due and payable,
without presentment, demand, protest or notice of any
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kind, all of which are hereby expressly waived and the obligation of the
Borrower to provide cash collateral for its Obligations with respect to Letters
of Credit as aforesaid in Clause (a) directly above and the pledge thereof and
grant of a security interest therein to the Agent and the Lenders shall
automatically become effective, in each case without further act of Agent or any
Lender; and
(c) Set-off. If an Event of Default shall occur and be continuing,
any Lender to whom any Obligation is owed by any Loan Party hereunder or under
any other Loan Document or any participant of such Lender which has agreed in
writing to be bound by the provisions of Section 9.13 [Equalization of Lenders]
and any branch, Subsidiary or Affiliate of such Lender or participant anywhere
in the world shall have the right, in addition to all other rights and remedies
available to it, without notice to such Loan Party, to set-off against and apply
to the then unpaid balance of all the Loans and all other Obligations of the
Borrower and the other Loan Parties hereunder or under any other Loan Document
any debt owing to, and any other funds held in any manner for the account of,
the Borrower or such other Loan Party by such Lender or participant or by such
branch, Subsidiary or Affiliate, including all funds in all deposit accounts
(whether time or demand, general or special, provisionally credited or finally
credited, or otherwise) now or hereafter maintained by the Borrower or such
other Loan Party for its own account (but not including funds held in custodian
or trust accounts) with such Lender or participant or such branch, Subsidiary or
Affiliate. Such right shall exist whether or not any Lender or the Agent shall
have made any demand under this Agreement or any other Loan Document, whether or
not such debt owing to or funds held for the account of the Borrower or such
other Loan Party is or are matured or unmatured and regardless of the existence
or adequacy of any Guaranty or any other security, right or remedy available to
any Lender or the Agent; and
(d) Suits, Actions, Proceedings. If an Event of Default shall occur
and be continuing, and whether or not the Agent shall have accelerated the
maturity of Loans pursuant to any of the foregoing provisions of this Section
8.02, the Agent or any Lender, if owed any amount with respect to the Loans, may
proceed to protect and enforce its rights by suit in equity, action at law
and/or other appropriate proceeding, whether for the specific performance of any
covenant or agreement contained in this Agreement or the other Loan Documents,
including as permitted by applicable Law the obtaining of the ex parte
appointment of a receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any other
legal or equitable right of the Agent or such Lender; and
(e) Application of Proceeds; Collateral Sharing.
(i) Application of Proceeds. From and after the date on which
the Agent has taken any action pursuant to this Section 8.02 and until all
Obligations of the Loan Parties have been paid in full, any and all proceeds
received by the Agent from the exercise of any remedy by the Agent, shall be
applied as follows:
(A) first, to reimburse the Agent and the Lenders for
out-of-pocket costs, expenses and disbursements, including reasonable attorneys'
and paralegals' fees and legal expenses, incurred by the Agent or the Lenders in
connection with collection of any Obligations of any of the Loan Parties under
any of the Loan Documents;
(B) second, to the repayment of all Indebtedness then
due and unpaid of the Loan Parties to the Lenders incurred under this Agreement
or any of the other Loan Documents or a Lender-Provided Interest Rate Hedge,
whether of principal, interest, fees, expenses or otherwise, and to
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the cash collateralization of Letters of Credit outstanding, all in such manner
as the Agent may determine in its discretion; and
(C) the balance, if any, as required by Law.
(ii) Collateral Sharing. All Liens granted under the Security
Documents shall secure, from the time set forth at Section 7.01(k), on a first
priority perfected basis subject to no other Liens other than Permitted Liens
(i) the Obligations in favor of the Agent and the Lenders hereunder and (ii) the
Obligations incurred by any of the Loan Parties in favor of any Lender which
provides a Lender-Provided Interest Rate Hedge (the "IRH Provider").
(f) Other Rights and Remedies. In addition to all of the rights and
remedies contained in this Agreement or in any of the other Loan Documents, the
Agent shall have all of the rights and remedies under applicable Law, all of
which rights and remedies shall be cumulative and non-exclusive, to the extent
permitted by Law. The Agent may, and upon the request of the Required Lenders
shall, exercise all post-default rights granted to the Agent and the Lenders
under the Loan Documents or applicable Law.
ARTICLE IX THE AGENT
Section 9.01 Appointment. Each Lender hereby irrevocably designates,
appoints and authorizes National City Bank to act as Agent for such Lender under
this Agreement and to execute and deliver or accept on behalf of each of the
Lenders the other Loan Documents. Each Lender hereby irrevocably authorizes, the
Agent to take such action on its behalf under the provisions of this Agreement
and the other Loan Documents and any other instruments and agreements referred
to herein, and to exercise such powers and to perform such duties hereunder as
are specifically delegated to or required of the Agent by the terms hereof,
together with such powers as are reasonably incidental thereto. National City
Bank agrees to act as the Agent on behalf of the Lenders to the extent provided
in this Agreement.
Section 9.02 Delegation of Duties. The Agent may perform any of its duties
hereunder by or through agents or employees (provided such delegation does not
constitute a relinquishment of its duties as Agent) and, subject to Section 9.05
[Reimbursement of Agent by Borrower, Etc.] and Section 9.06, shall be entitled
to engage and pay for the advice or services of any attorneys, accountants or
other experts concerning all matters pertaining to its duties hereunder and to
rely upon any advice so obtained.
Section 9.03 Nature of Duties; Independent Credit Investigation. The Agent
shall have no duties or responsibilities except those expressly set forth in
this Agreement and no implied covenants, functions, responsibilities, duties,
obligations, or liabilities shall be read into this Agreement or otherwise
exist. The duties of the Agent shall be mechanical and administrative in nature;
the Agent shall not have by reason of this Agreement a fiduciary or trust
relationship in respect of any Lender; and nothing in this Agreement, expressed
or implied, is intended to or shall be so construed as to impose upon the Agent
any obligations in respect of this Agreement except as expressly set forth
herein. Without limiting the generality of the foregoing, the use of the term
"agent" in this Agreement with reference to the Agent is not intended to connote
any fiduciary or other implied (or express) obligations arising under agency
doctrine of any applicable Law. Instead, such term is used merely as a matter of
market custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties. Each Lender expressly
acknowledges (i) that the Agent has not made any representations or warranties
to it and that no act by the Agent hereafter taken, including any review of the
affairs of any of the Loan Parties, shall be deemed to constitute any
representation or warranty by the Agent to any Lender; (ii) that
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it has made and will continue to make, without reliance upon the Agent, its own
independent investigation of the financial condition and affairs and its own
appraisal of the creditworthiness of each of the Loan Parties in connection with
this Agreement and the making and continuance of the Loans hereunder; and (iii)
except as expressly provided herein, that the Agent shall have no duty or
responsibility, either initially or on a continuing basis, to provide any Lender
with any credit or other information with respect thereto, whether coming into
its possession before the making of any Loan or at any time or times thereafter.
Section 9.04 Actions in Discretion of Agent; Instructions From the
Lenders. The Agent agrees, upon the written request of the Required Lenders, to
take or refrain from taking any action of the type specified as being within the
Agent's rights, powers or discretion herein, provided that the Agent shall not
be required to take any action which exposes the Agent to personal liability or
which is contrary to this Agreement or any other Loan Document or applicable
Law. In the absence of a request by the Required Lenders, the Agent shall have
authority, in its sole discretion, to take or not to take any such action,
unless this Agreement specifically requires the consent of the Required Lenders
or all of the Lenders. Any action taken or failure to act pursuant to such
instructions or discretion shall be binding on the Lenders, subject to Section
9.06 [Exculpatory Provisions, Etc.]. Subject to the provisions of Section 9.06,
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, or in the absence of such
instructions, in the absolute discretion of the Agent.
Section 9.05 Reimbursement and Indemnification of Agent by the Borrower.
The Borrower unconditionally agrees to pay or reimburse the Agent and each of
its directors, officers, employees, counsel, agents, and attorneys-in-fact
(collectively, the "Agent Indemnitees" and each an "Agent Indemnitee") and hold
each of the Agent Indemnitees harmless against (a) liability for the payment of
all reasonable out-of-pocket costs, expenses and disbursements, including fees
and expenses of counsel (including the allocated costs of staff counsel),
appraisers and environmental consultants, incurred by any Agent Indemnitee (i)
in connection with the development, negotiation, preparation, printing,
execution, administration, syndication, interpretation and performance of this
Agreement and the other Loan Documents, (ii) relating to any requested
amendments, waivers or consents pursuant to the provisions hereof, (iii) in
connection with the enforcement of this Agreement or any other Loan Document or
collection of amounts due hereunder or thereunder or the proof and allowability
of any claim arising under this Agreement or any other Loan Document, whether in
bankruptcy or receivership proceedings or otherwise, (iv) in any workout or
restructuring or in connection with the protection, preservation, exercise or
enforcement of any of the terms hereof or of any rights hereunder or under any
other Loan Document or in connection with any foreclosure, collection or
bankruptcy proceedings, and (v) in connection with any Environmental Complaint
threatened or asserted against any Agent Indemnitee or the Lenders in any way
relating to or arising out of this Agreement or any other Loan Documents
(including, without limitation, the protection, preservation, exercise or
enforcement of any of the terms hereof or of any rights hereunder or under any
other Loan Document or in connection with any foreclosure, collection or
bankruptcy proceedings or in any workout or restructuring) and (b) all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against any Agent Indemnitee acting on
behalf of or as the Agent, in its capacity as such, in any way relating to or
arising out of (i) this Agreement or any other Loan Documents or any action
taken or omitted by any Agent Indemnitee hereunder or thereunder, and (ii) any
Environmental Complaint in any way relating to or arising out of this Agreement
or any other Loan Documents or any action taken or omitted by any Agent
Indemnitee hereunder or thereunder, provided that the Borrower shall not be
liable to an Agent Indemnitee for any portion of such liabilities, obligations,
losses, damages, penalties, actions,
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judgments, suits, costs, expenses or disbursements to the extent the same
results from such Agent Indemnitee's gross negligence or willful misconduct, or
if the Borrower was not given notice of the subject claim and the opportunity to
participate in the defense thereof, at its expense (except that the Borrower
shall remain liable to the extent such failure to give notice does not result in
a loss to the Borrower), or if the same results from a compromise or settlement
agreement entered into without the consent of the Borrower, which shall not be
unreasonably withheld. In addition, the Borrower agrees to reimburse and pay all
reasonable out-of-pocket expenses of the Agent's regular employees and agents
engaged periodically to perform audits of the Loan Parties' books, records and
business properties.
Section 9.06 Exculpatory Provisions; Limitation of Liability. Neither the
Agent nor any of its directors, officers, employees, agents, attorneys or
Affiliates shall (a) be liable to any Lender for any action taken or omitted to
be taken by it or them hereunder, or in connection herewith including pursuant
to any Loan Document, unless caused by its or their own gross negligence or
willful misconduct, (b) be responsible in any manner to any of the Lenders for
the effectiveness, enforceability, genuineness, validity or the due execution of
this Agreement or any other Loan Documents or for any recital, representation,
warranty, document, certificate, report or statement herein or made or furnished
under or in connection with this Agreement or any other Loan Documents, or (c)
be under any obligation to any of the Lenders to ascertain or to inquire as to
the performance or observance of any of the terms, covenants or conditions
hereof or thereof on the part of the Loan Parties, or the financial condition of
the Loan Parties, or the existence or possible existence of any Event of Default
or Potential Default. No claim may be made by any of the Loan Parties, any
Lender, the Agent or any of their respective Subsidiaries against the Agent, any
Lender or any of their respective directors, officers, employees, agents,
attorneys or Affiliates, or any of them, for any special, indirect or
consequential damages or, to the fullest extent permitted by Law, for any
punitive damages in respect of any claim or cause of action (whether based on
contract, tort, statutory liability, or any other ground) based on, arising out
of or related to any Loan Document or the transactions contemplated hereby or
any act, omission or event occurring in connection therewith, including the
negotiation, documentation, administration or collection of the Loans, and each
of the Loan Parties, (for itself and on behalf of each of its Subsidiaries), the
Agent and each Lender hereby waive, releases and agree never to xxx upon any
claim for any such damages, whether such claim now exists or hereafter arises
and whether or not it is now known or suspected to exist in its favor. Each
Lender agrees that, except for notices, reports and other documents expressly
required to be furnished to the Lenders by the Agent hereunder or given to the
Agent for the account of or with copies for the Lenders, the Agent and each of
its directors, officers, employees, agents, attorneys or Affiliates shall not
have any duty or responsibility to provide any Lender with an credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of the Loan Parties which may come
into the possession of the Agent or any of its directors, officers, employees,
agents, attorneys or Affiliates.
Section 9.07 Reimbursement and Indemnification of Agent by Lenders. Each
Lender agrees to reimburse and indemnify, defend and save the Agent (to the
extent not reimbursed by the Borrower and without limiting the Obligation of the
Borrower to do so) in proportion to its Ratable Share harmless from and against
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements, including attorneys' fees and
disbursements (including the allocated costs of staff counsel), and costs of
appraisers and environmental consultants, of any kind or nature whatsoever which
may be imposed on, incurred by or asserted against the Agent, in its capacity as
such, in any way relating to or arising out of this Agreement or any other Loan
Documents or any action taken or omitted by the Agent hereunder or thereunder,
provided that no Lender shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements (a) if the same results from the Agent's gross
negligence or willful misconduct, or (b) if
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such Lender was not given notice of the subject claim and the opportunity to
participate in the defense thereof, at its expense (except that such Lender
shall remain liable to the extent such failure to give notice does not result in
a loss to the Lender), or (c) if the same results from a compromise and
settlement agreement entered into without the consent of such Lender, which
shall not be unreasonably withheld. In addition, each Lender agrees promptly
upon demand to reimburse the Agent (to the extent not reimbursed by the Borrower
and without limiting the Obligation of the Borrower to do so) in proportion to
its Ratable Share for all amounts due and payable by the Borrower to the Agent
in connection with the Agent's periodic audit of the Loan Parties' books,
records and business properties.
Section 9.08 Reliance by Agent. The Agent shall be entitled to rely upon
any writing, telegram, telex or teletype message, resolution, notice, consent,
certificate, letter, cablegram, statement, order or other document or
conversation by telephone or otherwise believed by it to be genuine and correct
and to have been signed, sent or made by the proper Person or Persons, and upon
the advice and opinions of counsel and other professional advisers selected by
the Agent. The Agent shall be fully justified in failing or refusing to take any
action hereunder unless it shall first be indemnified to its satisfaction by the
Lenders against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action.
Section 9.09 Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Potential Default or Event of
Default unless the Agent has received written notice from a Lender or the
Borrower referring to this Agreement, describing such Potential Default or Event
of Default and stating that such notice is a "notice of default."
Section 9.10 Notices. The Agent shall promptly send to each Lender a copy
of all notices received from the Borrower pursuant to the provisions of this
Agreement or the other Loan Documents promptly upon receipt thereof. The Agent
shall promptly notify the Borrower and the other Lenders of each change in the
Base Rate and the effective date thereof.
Section 9.11 Lenders in Their Individual Capacities; Agents in Its
Individual Capacity. With respect to its Revolving Credit Commitment and the
Revolving Credit Loans made by it and any other rights and powers given to it as
a Lender hereunder or under any of the other Loan Documents, the Agent shall
have the same rights and powers hereunder as any other Lender and may exercise
the same as though it were not the Agent, and the term "Bank" and "Lenders"
shall, unless the context otherwise indicates, include the Agent in its
individual capacity. National City Bank and its Affiliates and each of the
Lenders and their respective Affiliates may, without liability to account,
except as prohibited herein, make loans to, issue letters of credit for the
account of, acquire equity interests in, accept deposits from, discount drafts
for, act as trustee under indentures of, and generally engage in any kind of
banking, trust, financial advisory, underwriting or other business with, the
Loan Parties and their Affiliates, in the case of the Agent, as though it were
not acting as Agent hereunder and in the case of each Lender, as though such
Lender were not a Lender hereunder, in each case without notice to or consent of
the other Lenders. The Lenders and Agent acknowledge that, pursuant to such
activities, the Agent, Lenders and any of their respective Affiliates may (i)
receive information regarding the Loan Parties or any of their Subsidiaries or
Affiliates (including information that may be subject to confidentiality
obligations in favor of the Loan Parties or such Subsidiary or Affiliate) and
acknowledge that none of the Agent, any Lender, or any of their respective
Affiliates shall be under any obligation to provide such information to any of
the others, and (ii) accept fees and other consideration from the Loan Parties
for services in connection with this Agreement and otherwise without having to
account for the same to any of the others.
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Section 9.12 Holders. The Agent shall maintain at its Principal Office or
at one of its other offices a copy of each Assignment and Assumption Agreement
delivered to it and a register for the recordation of the names and addresses of
the Lenders, and the Commitments of, and principal amounts of the Loans owing
to, each Lender pursuant to the terms hereof from time to time (the "Register").
The entries in the Register shall be conclusive, and the Borrower, the Agent,
and the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower and any Lender, at any reasonable time
and from time to time upon reasonable prior notice.
Section 9.13 Equalization of Lenders. The Lenders and the holders of any
participations in any Commitments or Loans or other rights or obligations of a
Lender hereunder agree among themselves that, with respect to all amounts
received by any Lender or any such holder for application on any Obligation
hereunder or under any such participation, whether received by voluntary
payment, by realization upon security, by the exercise of the right of set-off
or banker's lien, by counterclaim or by any other non-pro rata source, equitable
adjustment will be made in the manner stated in the following sentence so that,
in effect, all such excess amounts will be shared ratably among the Lenders and
such holders in proportion to their interests in payments on the Loans, except
as otherwise provided in Section 3.04(c) [Agent's and Lender's Rights], Section
4.04(b) [Replacement of a Lender] or Section 4.06 [Additional Compensation in
Certain Circumstances]. The Lenders or any such holder receiving any such amount
shall purchase for cash from each of the other Lenders an interest in such
Lender's Loans in such amount as shall result in a ratable participation by the
Lenders and each such holder in the aggregate unpaid amount of the Loans,
provided that if all or any portion of such excess amount is thereafter
recovered from the Lender or the holder making such purchase, such purchase
shall be rescinded and the purchase price restored to the extent of such
recovery, together with interest or other amounts, if any, required by law
(including court order) to be paid by the Lender or the holder making such
purchase.
Section 9.14 Successor Agent. The Agent (i) may resign as Agent or (ii)
shall resign if such resignation is requested by the Required Lenders (if the
Agent is a Lender, the Agent's Loans and its Commitment shall be considered in
determining whether the Required Lenders have requested such resignation) or
required by Section 4.04(b) [Replacement of a Lender], in either case of (i) or
(ii) by giving not less than thirty (30) days' prior written notice to the
Borrower. If the Agent shall resign under this Agreement, then either (a) the
Required Lenders shall appoint from among the Lenders a successor agent for the
Lenders, subject to the consent of the Borrower, such consent not to be
unreasonably withheld, or (b) if a successor agent shall not be so appointed and
approved within the thirty (30) day period following the Agent's notice to the
Lenders of its resignation, then the Agent shall appoint, with the consent of
the Borrower, such consent not to be unreasonably withheld, a successor agent
who shall serve as Agent until such time as the Required Lenders appoint and the
Borrower consents to the appointment of a successor agent. Upon its appointment
pursuant to either clause (a) or (b) above, such successor agent shall succeed
to the rights, powers and duties of the Agent, and the term "Agent" shall mean
such successor agent, effective upon its appointment, and the former Agent's
rights, powers and duties as Agent shall be terminated without any other or
further act or deed on the part of such former Agent or any of the parties to
this Agreement. After the resignation of any Agent hereunder, the provisions of
this Article IX shall inure to the benefit of such former Agent and such former
Agent shall not by reason of such resignation be deemed to be released from
liability for any actions taken or not taken by it while it was an Agent under
this Agreement.
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Section 9.15 Agent's Fee. The Borrower shall pay to the Agent a
nonrefundable fee (the "Agent's Fee") under the terms of a letter (the "Agent's
Letter"), dated as of March 13, 2003, between the Borrower and Agent, as amended
from time to time.
Section 9.16 Availability of Funds. The Agent may assume that each Lender
has made or will make the proceeds of a Loan available to the Agent unless the
Agent shall have been notified by such Lender on or before the later of (1) the
close of Business on the Business Day preceding the Borrowing Date with respect
to such Loan or two (2) hours before the time on which the Agent actually funds
the proceeds of such Loan to the Borrower (whether using its own funds pursuant
to this Section 9.16 or using proceeds deposited with the Agent by the Lenders
and whether such funding occurs before or after the time on which Lenders are
required to deposit the proceeds of such Loan with the Agent). The Agent may, in
reliance upon such assumption (but shall not be required to), make available to
the Borrower a corresponding amount. If such corresponding amount is not in fact
made available to the Agent by such Lender, the Agent shall be entitled to
recover such amount on demand from such Lender (or, if such Lender fails to pay
such amount forthwith upon such demand from the Borrower) together with interest
thereon, in respect of each day during the period commencing on the date such
amount was made available to the Borrower and ending on the date the Agent
recovers such amount, at a rate per annum equal to (i) the Federal Funds
Effective Rate during the first three (3) days after such interest shall begin
to accrue and (ii) the applicable interest rate in respect of such Loan after
the end of such three-day period.
Section 9.17 Calculations. In the absence of gross negligence or willful
misconduct, the Agent shall not be liable for any error in computing the amount
payable to any Lender whether in respect of the Loans, fees or any other amounts
due to the Lenders under this Agreement. In the event an error in computing any
amount payable to any Lender is made, the Agent, the Borrower and each affected
Lender shall, forthwith upon discovery of such error, make such adjustments as
shall be required to correct such error, and any compensation therefor will be
calculated at the Federal Funds Effective Rate.
Section 9.18 Beneficiaries. Except as expressly provided herein, the
provisions of this Article IX are solely for the benefit of the Agent and the
Lenders, and the Loan Parties shall not have any rights to rely on or enforce
any of the provisions hereof. In performing its functions and duties under this
Agreement, the Agent shall act solely as agent of the 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 any of the Loan Parties.
Section 9.19 Other Agent Titles. Each of the parties hereto acknowledge
and agree that the titles of Co-Documentation Agent and Co-Syndication Agent are
honorary and do not imply or impose any duty or obligation of any nature on any
party having any such title.
ARTICLE X MISCELLANEOUS
Section 10.01 Modifications, Amendments or Waivers. With the written
consent of the Required Lenders, the Agent, acting on behalf of all the Lenders,
and the Borrower, on behalf of the Loan Parties, may from time to time enter
into written agreements amending or changing any provision of this Agreement or
any other Loan Document or the rights of the Lenders or the Loan Parties
hereunder or thereunder, or may grant written waivers or consents to a departure
from the due performance of the Obligations of the Loan Parties hereunder or
thereunder. Any such agreement, waiver or consent made with such written consent
shall be effective to bind all the Lenders and the Loan Parties; provided, that,
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without the written consent of all the Lenders, no such agreement, waiver or
consent may be made which will:
(a) Increase of Commitment; Extension of Expiration Date. Increase
the amount of the Revolving Credit Commitment of any Lender hereunder or extend
the Expiration Date;
(b) Extension of Payment; Reduction of Principal Interest or Fees;
Modification of Terms of Payment. Whether or not any Loans are outstanding,
extend the time for payment of principal or interest of any Loan (excluding the
due date of any mandatory prepayment of a Loan or any mandatory Commitment
reduction in connection with such a mandatory prepayment hereunder except for
mandatory reductions of the Commitments on the Expiration Date), the Facility
Fee, Utilization Fee or any other fee payable to any Lender, or reduce the
principal amount of or the rate of interest borne by any Loan or reduce the
Facility Fee, Utilization Fee, or any other fee payable to any Lender, or
otherwise affect the terms of payment of the principal of or interest of any
Loan, the Facility Fee, Utilization Fee, or any other fee payable to any Lender;
(c) Release of Guarantor. Release any Guarantor from its Obligations
under the Guaranty Agreement or any other security for any of the Loan Parties'
Obligations (other than cash collateral as provided in Section 4.05 or Section
8.02); or
(d) Miscellaneous. Amend Section 4.02 [Pro Rata Treatment of
Lenders], Section 8.02(e)(i) [Application of Proceeds], Section 9.06
[Exculpatory Provisions, Etc.] or Section 9.13 [Equalization of Lenders] or this
Section 10.01, alter any provision regarding the pro rata treatment of the
Lenders, change the definition of Required Lenders, or change any requirement
providing for the Lenders or the Required Lenders to authorize the taking of any
action hereunder;
provided, further, that no agreement, waiver or consent which would modify the
interests, rights or obligations of the Agent in its capacity as Agent or an
Issuing Bank in its capacity as the issuer of Letters of Credit shall be
effective without the written consent of the Agent or such Issuing Bank, as the
case may be.
Section 10.02 No Implied Waivers; Cumulative Remedies; Writing Required.
No course of dealing and no delay or failure of the Agent or any Lender in
exercising any right, power, remedy or privilege under this Agreement or any
other Loan Document shall affect any other or future exercise thereof or operate
as a waiver thereof, nor shall any single or partial exercise thereof or any
abandonment or discontinuance of steps to enforce such a right, power, remedy or
privilege preclude any further exercise thereof or of any other right, power,
remedy or privilege. The rights and remedies of the Agent and the Lenders under
this Agreement and any other Loan Documents are cumulative and not exclusive of
any rights or remedies which they would otherwise have. Any waiver, permit,
consent or approval of any kind or character on the part of any Lender of any
breach or default under this Agreement or any such waiver of any provision or
condition of this Agreement must be in writing and shall be effective only to
the extent specifically set forth in such writing.
Section 10.03 Reimbursement and Indemnification of Lenders by the
Borrower; Taxes. The Borrower agrees unconditionally upon demand to pay or
reimburse to each Lender (other than the Agent in such capacity, as to which the
Borrower's Obligations are set forth in Section 9.05 [Reimbursement of Agent By
Borrower, Etc.]) and to save such Lender harmless against (i) liability for the
payment of all reasonable out-of-pocket costs, expenses and disbursements
(including fees and expenses of counsel (including allocated costs of staff
counsel) for each Lender except with respect to (a) and (b) below),
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incurred by such Lender (a) in connection with the administration and
interpretation of this Agreement, and other instruments and documents to be
delivered hereunder, (b) relating to any amendments, waivers or consents
pursuant to the provisions hereof, (c) in connection with the enforcement of
this Agreement or any other Loan Document, or collection of amounts due
hereunder or thereunder or the proof and allowability of any claim arising under
this Agreement or any other Loan Document, whether in bankruptcy or receivership
proceedings or otherwise, (d) in any workout or restructuring or in connection
with the protection, preservation, exercise or enforcement of any of the terms
hereof or of any rights hereunder or under any other Loan Document or in
connection with any foreclosure, collection or bankruptcy proceedings, and (e)
in connection with any Environmental Complaint threatened or asserted against
the Lender in any way relating to or arising out of this Agreement or any other
Loan Documents (including, without limitation, the protection, preservation,
exercise or enforcement of any of the terms hereof or of any rights hereunder or
under any other Loan Document or in connection with any foreclosure, collection
or bankruptcy proceedings or in any workout or restructuring), and the Borrower
agrees to indemnify and save each Lender and each of its directors, officers,
employees, counsel, agents and attorneys-in-fact (collectively, the Indemnitees"
and each an "Indemnitee") harmless against all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever (including fees and expenses of counsel
(including allocated costs of staff counsel)) which may be imposed on, incurred
by or asserted against any Indemnitee acting on behalf of or as a Lender, in its
capacity as such, in any way relating to or arising out of (y) this Agreement or
any other Loan Documents or any action taken or omitted by an Indemnitee
hereunder or thereunder and (z) any Environmental Complaint in any way relating
to or arising out of this Agreement or any other Loan Documents or any action
taken or omitted by an Indemnitee hereunder or thereunder (including any claim,
litigation, investigation, or proceeding relating to any of the foregoing,
whether based on contract, tort, or any other theory and regardless whether any
Indemnitee is a party thereto), provided that the Borrower shall not be liable
to an Indemnitee for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
(A) if the same results from such Indemnitee's gross negligence or willful
misconduct, or (B) if the Borrower was not given notice of the subject claim and
the opportunity to participate in the defense thereof, at its expense (except
that the Borrower shall remain liable to the extent such failure to give notice
does not result in a loss to the Borrower), or (C) if the same results from a
compromise or settlement agreement entered into without the consent of the
Borrower, which shall not be unreasonably withheld. The Lenders and other
Indemnitees will attempt to minimize the fees and expenses of legal counsel for
the Lenders and other Indemnitees which are subject to reimbursement by the
Borrower hereunder by considering the usage of one law firm to represent the
Lenders, other Indemnitees, and the Agent if appropriate under the
circumstances. The Borrower agrees unconditionally to pay all stamp, document,
transfer, recording or filing taxes or fees and similar impositions now or
hereafter determined by the Agent or any Lender to be payable in connection with
this Agreement or any other Loan Document, and the Borrower agrees
unconditionally to save the Agent and the Lenders harmless from and against any
and all present or future claims, liabilities or losses with respect to or
resulting from any omission to pay or delay in paying any such taxes, fees or
impositions.
Section 10.04 Holidays. Whenever payment of a Loan to be made or taken
hereunder shall be due on a day which is not a Business Day such payment shall
be due on the next Business Day (except as provided in Section 3.02(c) [Interest
Periods] with respect to Interest Periods under the LIBOR Option) and such
extension of time shall be included in computing interest and fees, except that
the Loans shall be due on the Business Day preceding the Expiration Date if the
Expiration Date is not a Business Day. Whenever any payment or action to be made
or taken hereunder (other than payment of the Loans) shall be stated to be due
on a day which is not a Business Day, such payment or action shall be made or
taken
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on the next following Business Day, and such extension of time shall not be
included in computing interest or fees, if any, in connection with such payment
or action.
Section 10.05 Funding by Branch, Subsidiary or Affiliate.
(a) Notional Funding. Each Lender shall have the right from time to
time, without notice to the Borrower, to deem any branch, Subsidiary or
Affiliate (which for the purposes of this Section 10.05 shall mean any
corporation or association which is directly or indirectly controlled by or is
under direct or indirect common control with any corporation or association
which directly or indirectly controls such Lender) of such Lender to have made,
maintained or funded any Loan to which the LIBOR Option applies at any time,
provided that immediately following (on the assumption that a payment were then
due from the Borrower to such other office), and as a result of such change, the
Borrower would not be under any greater financial obligation pursuant to Section
4.06 [Additional Compensation in Certain Circumstances] than it would have been
in the absence of such change. Notional funding offices may be selected by each
Lender without regard to such Lender's actual methods of making, maintaining or
funding the Loans or any sources of funding actually used by or available to
such Lender.
(b) Actual Funding. Each Lender shall have the right from time to
time to make or maintain any Loan by arranging for a branch, Subsidiary or
Affiliate of such Lender to make or maintain such Loan subject to the last
sentence of this Section 10.05(b). If any Lender causes a branch, Subsidiary or
Affiliate to make or maintain any part of the Loans hereunder, all terms and
conditions of this Agreement shall, except where the context clearly requires
otherwise, be applicable to such part of the Loans to the same extent as if such
Loans were made or maintained by such Lender, but in no event shall any Lender's
use of such a branch, Subsidiary or Affiliate to make or maintain any part of
the Loans hereunder cause such Lender or such branch, Subsidiary or Affiliate to
incur any cost or expenses payable by the Borrower hereunder or require the
Borrower to pay any other compensation to any Lender (including any expenses
incurred or payable pursuant to Section 4.06 [Additional Compensation in Certain
Circumstances]) which would otherwise not be incurred.
Section 10.06 Notices. Any notice, request, demand, direction or other
communication (for purposes of this Section 10.06 only, a "Notice") to be given
to or made upon any party hereto under any provision of this Agreement shall be
given or made by telephone or in writing (which includes means of electronic
transmission (i.e., "e-mail") or facsimile transmission or by setting forth such
Notice on a site on the world wide web (a "Website Posting") if Notice of such
Website Posting (including the information necessary to access such site) has
previously been or is substantially contemporaneously delivered to the
applicable parties hereto by another means set forth in this Section 10.06) in
accordance with this Section 10.06. Any such Notice must be delivered to the
applicable parties hereto at the addresses and numbers set forth under their
respective names on Schedule 1.01(B) hereof or in accordance with any subsequent
unrevoked Notice from any such party that is given in accordance with this
Section 10.06. Any Notice shall be effective:
(i) In the case of hand-delivery, when delivered;
(ii) If given by mail, four days after such Notice is
deposited with the United States Postal Service, with first-class postage
prepaid, return receipt requested;
(iii) In the case of a telephonic Notice, when a party is
contacted by telephone, if delivery of such telephonic Notice is confirmed no
later than the next Business Day by hand
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delivery, a facsimile or electronic transmission, a Website Posting or overnight
courier delivery of a confirmatory notice (received at or before noon on such
next Business Day);
(iv) In the case of a facsimile transmission, when sent to the
applicable party's facsimile machine's telephone number if the party sending
such Notice receives confirmation of the delivery thereof from its own facsimile
machine;
(v) In the case of electronic transmission, when actually
received;
(vi) In the case of a Website Posting, upon delivery of a
Notice of such posting (including the information necessary to access such web
site) by another means set forth in this Section 10.06; and
(vii) If given by any other means (including by overnight
courier), when actually received.
Any Lender giving a Notice to a Loan Party shall concurrently send a copy
thereof to the Agent, and the Agent shall promptly notify the other Lenders of
its receipt of such Notice.
Section 10.07 Severability. The provisions of this Agreement are intended
to be severable. If any provision of this Agreement shall be held invalid or
unenforceable in whole or in part in any jurisdiction, such provision shall, as
to such jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without in any manner affecting the validity or enforceability
thereof in any other jurisdiction or the remaining provisions hereof in any
jurisdiction.
Section 10.08 Governing Law. Each Letter of Credit and Section 2.09
[Letter of Credit Subfacility] shall be subject to the Uniform Customs and
Practice for Documentary Credits (1993 Revision), International Chamber of
Commerce Publication No. 500, as the same may be revised or amended from time to
time, and to the extent not inconsistent therewith, the internal laws of the
State of Ohio without regard to its conflict of laws principles, and the balance
of this Agreement shall be deemed to be a contract under the Laws of the State
of Ohio and for all purposes shall be governed by and construed and enforced in
accordance with the internal laws of the State of Ohio without regard to its
conflict of laws principles.
Section 10.09 Prior Understanding. This Agreement and the other Loan
Documents supersede all prior understandings and agreements, whether written or
oral, between the parties hereto and thereto relating to the transactions
provided for herein and therein, including any prior confidentiality agreements
and commitments.
Section 10.10 Duration; Survival. All representations and warranties of
the Loan Parties contained herein or made in connection herewith shall survive
the making of Loans and issuance of Letters of Credit and shall not be waived by
the execution and delivery of this Agreement, any investigation by the Agent or
the Lenders, the making of Loans, issuance of Letters of Credit, or payment in
full of the Loans. All covenants and agreements of the Loan Parties contained in
Section 7.01 [Affirmative Covenants], Section 7.02 [Negative Covenants] and
Section 7.03 [Reporting Requirements] herein shall continue in full force and
effect from and after the date hereof so long as the Borrower may borrow or
request Letters of Credit hereunder and until termination of the Commitments and
indefeasible payment in full of the Loans and expiration or termination of all
Letters of Credit. All covenants and agreements of the Borrower contained herein
relating to the payment of principal, interest, premiums,
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additional compensation or expenses and indemnification, including those set
forth in Article IV [Payments] and Section 9.05 [Reimbursement of Agent by
Borrower, Etc.], Section 9.07 [Reimbursement of Agent by Lenders, Etc.] and
Section 10.03 [Reimbursement of Lenders by Borrower; Etc.], shall survive
payment in full of the Loans, expiration or termination of the Letters of Credit
and termination of the Commitments.
Section 10.11 Assignments, Participations, Successors and Assigns.
(a) This Agreement shall be binding upon and shall inure to the
benefit of the Lenders, the Agent, the Loan Parties and their respective
successors and assigns, except that none of the Loan Parties may assign or
transfer any of its rights and Obligations hereunder or any interest herein.
Each Lender may, at its own cost, make assignments of or sell participations in
all or any part of its Commitments and the Loans made by it to one or more banks
or other entities, subject to the consent of the Borrower, each Issuing Bank,
and the Agent with respect to any assignee, such consent not to be unreasonably
withheld, provided that (1) no consent of the Borrower shall be required (A) if
an Event of Default exists and is continuing, or (B) in the case of an
assignment by a Lender to an Affiliate of such Lender, and (2) any assignment by
a Lender to a Person other than an Affiliate of such Lender may not be made in
amounts less than the lesser of $3,000,000 or the amount of the assigning
Lender's Commitment. The parties to each assignment shall execute and deliver to
the Administrative Agent an Assignment and Assumption Agreement, and deliver to
the Agent a processing and recordation fee of $3,500 for each assignment (other
than an assignment by a Lender to its Affiliate), and the assignee, if it shall
not be a Lender, shall deliver to the Administrative Agent a completed
administrative questionnaire in the form requested by Agent. In the case of an
assignment, upon receipt by the Agent of the Assignment and Assumption
Agreement, such questionnaire, the applicable fee and any required consent, the
assignee shall have, to the extent of such assignment (unless otherwise provided
therein), the same rights, benefits and obligations as it would have if it had
been a signatory Lender hereunder, and the Commitments shall be adjusted
accordingly. In the case of a participation, the participant shall only have the
rights specified in Section 8.02(c) [Set-off] (the participant's rights against
such Lender in respect of such participation to be those set forth in the
agreement executed by such Lender in favor of the participant relating thereto
and not to include any voting rights except with respect to changes of the type
referenced in Section 10.01(a) [Increase of Commitment, Etc.], Section 10.01(b)
[Extension of Payment, Etc.], or Section 10.01(c) [Release of Guarantor]), all
of such Lender's obligations under this Agreement or any other Loan Document
shall remain unchanged, and all amounts payable by any Loan Party hereunder or
thereunder shall be determined as if such Lender had not sold such
participation.
(b) Any assignee or participant which is not incorporated under the
Laws of the United States of America or a state thereof shall deliver to the
Borrower and the Agent the form of certificate described in Section 10.17 [Tax
Withholding Clause] relating to federal income tax withholding. Each Lender may
furnish any publicly available information concerning any Loan Party or its
Subsidiaries and any other information concerning any Loan Party or its
Subsidiaries in the possession of such Lender from time to time to assignees and
participants (including prospective assignees or participants), provided that
such assignees and participants agree to be bound by the provisions of Section
10.12 [Confidentiality].
(c) Notwithstanding any other provision in this Agreement, any
Lender may at any time pledge or grant a security interest in all or any portion
of its rights under this Agreement, its Note (if any) and the other Loan
Documents to any Federal Reserve Bank in accordance with Regulation A of the FRB
or U.S. Treasury Regulation 31 CFR Section 203.14 without notice to or consent
of the Borrower or the
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Agent. No such pledge or grant of a security interest shall release the
transferor Lender of its obligations hereunder or under any other Loan Document.
Section 10.12 Confidentiality.
(a) General. The Agent and the Lenders each agree to keep
confidential all information obtained from any Loan Party or its Subsidiaries
which is nonpublic and confidential or proprietary in nature (including any
information the Borrower specifically designates as confidential), except as
provided below, and to use such information only in connection with their
respective capacities under this Agreement and for the purposes contemplated
hereby. The Agent and the Lenders shall be permitted to disclose such
information (i) to outside legal counsel, accountants and other professional
advisors who need to know such information in connection with the administration
and enforcement of this Agreement, subject to agreement of such Persons to
maintain the confidentiality, (ii) to assignees and participants as contemplated
by Section 10.11, and prospective assignees and participants, (iii) to the
extent requested by any bank regulatory authority or, with notice to the
Borrower, as otherwise required by applicable Law or by any subpoena or similar
legal process, or in connection with any investigation or proceeding arising out
of the transactions contemplated by this Agreement, (iv) if it becomes publicly
available other than as a result of a breach of this Agreement or becomes
available from a source not known to be subject to confidentiality restrictions,
(v) any information with respect to the "tax treatment" or "tax structure" (in
each case, within the meaning of Treasury Regulation Section 1.6011-4, as
amended from time to time) of any Loans or Letter of Credit or any related
transaction, notice of which Borrower or any other Loan Party is required to
provide to Agent and the Lenders pursuant to Section 7.03(i), and all materials
of any kind (including opinions or other tax analyses) that are provided to the
Agent or such Lender relating to such tax treatment or tax structure, or (vi) if
the Borrower shall have consented to such disclosure.
(b) Sharing Information With Affiliates of the Lenders. Each Loan
Party acknowledges that from time to time financial advisory, investment banking
and other services may be offered or provided to the Borrower or one or more of
its Affiliates (in connection with this Agreement or otherwise) by any Lender or
by one or more Subsidiaries or Affiliates of such Lender and each of the Loan
Parties hereby authorizes each Lender to share any information delivered to such
Lender by such Loan Party and its Subsidiaries pursuant to this Agreement, or in
connection with the decision of such Lender to enter into this Agreement, to any
such Subsidiary or Affiliate of such Lender, it being understood that any such
Subsidiary or affiliate of any Lender receiving such information shall be bound
by the provisions of Section 10.12(a) as if it were a Lender hereunder. Such
Authorization shall survive the repayment of the Loans and other Obligations and
the termination of the Commitments.
Section 10.13 Counterparts. This Agreement may be executed by different
parties hereto on any number of separate counterparts, each of which, when so
executed and delivered, shall be an original, and all such counterparts shall
together constitute one and the same instrument.
Section 10.14 Agent's or Lender's Consent. Whenever the Agent's or any
Lender's consent is required to be obtained under this Agreement or any of the
other Loan Documents as a condition to any action, inaction, condition or event,
the Agent and each Lender shall be authorized to give or withhold such consent
in its sole and absolute discretion and to condition its consent upon the giving
of additional collateral, the payment of money or any other matter.
Section 10.15 Exceptions. The representations, warranties and covenants
contained herein shall be independent of each other, and no exception to any
representation, warranty or covenant shall be
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deemed to be an exception to any other representation, warranty or covenant
contained herein unless expressly provided, nor shall any such exceptions be
deemed to permit any action or omission that would be in contravention of
applicable Law.
Section 10.16 CONSENT TO FORUM; WAIVER OF JURY TRIAL. EACH LOAN PARTY
HEREBY IRREVOCABLY CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF THE COURT OF
COMMON PLEAS OF CUYAHOGA COUNTY AND THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF OHIO, EASTERN DIVISION, AND WAIVES PERSONAL SERVICE OF ANY
AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE BY
CERTIFIED OR REGISTERED MAIL DIRECTED TO SUCH LOAN PARTY AT THE ADDRESSES
PROVIDED FOR IN SECTION 10.06 AND SERVICE SO MADE SHALL BE DEEMED TO BE
COMPLETED UPON ACTUAL RECEIPT THEREOF. EACH LOAN PARTY WAIVES ANY OBJECTION TO
JURISDICTION AND VENUE OF ANY ACTION INSTITUTED AGAINST IT AS PROVIDED HEREIN
AND AGREES NOT TO ASSERT ANY DEFENSE BASED ON LACK OF JURISDICTION OR VENUE.
EACH LOAN PARTY, THE AGENT AND THE LENDERS HEREBY WAIVE TRIAL BY JURY IN ANY
ACTION, SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED
TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE COLLATERAL TO THE FULL EXTENT
PERMITTED BY LAW.
Section 10.17 Tax Withholding Clause. Each Lender or assignee or
participant of a Lender that is not incorporated under the Laws of the United
States of America or a state thereof (and, upon the written request of the
Administrative Agent, each other Lender or assignee or participant of a Lender)
agrees that it will deliver to each of the Borrower and the Administrative Agent
two (2) duly completed appropriate valid Withholding Certificates (as defined
under Section 1.1441-1(c)(16) of the Income Tax Regulations (the "Regulations"))
certifying its status (i.e. U.S. or foreign person) and, if appropriate, making
a claim of reduced, or exemption from, U.S. withholding tax on the basis of an
income tax treaty or an exemption provided by the Internal Revenue Code. The
term "Withholding Certificate" means a Form W-9; a Form W-8BEN; a Form W-8ECI; a
Form W-8IMY and the related statements and certifications as required under
Section 1.1441-1(e)(2) and/or (3) of the Regulations; a statement described in
Section 1.871-14(c)(2)(v) of the Regulations; or any other certificates under
the Internal Revenue Code or Regulations that certify or establish the status of
a payee or beneficial owner as a U.S. or foreign person. Each Lender, assignee
or participant required to deliver to the Borrower and the Administrative Agent
a Withholding Certificate pursuant to the preceding sentence shall deliver such
valid Withholding Certificate as follows: (A) each Lender which is a party
hereto on the Closing Date shall deliver such valid Withholding Certificate at
least five (5) Business Days prior to the first date on which any interest or
fees are payable by the Borrower hereunder for the account of such Lender; (B)
each assignee or participant shall deliver such valid Withholding Certificate at
least five (5) Business Days before the effective date of such assignment or
participation (unless the Administrative Agent in its sole discretion shall
permit such assignee or participant to deliver such valid Withholding
Certificate less than five (5) Business Days before such date in which case it
shall be due on the date specified by the Administrative Agent). Each Lender,
assignee or participant which so delivers a valid Withholding Certificate
further undertakes to deliver to each of the Borrower and the Administrative
Agent two (2) additional copies of such Withholding Certificate (or a successor
form) on or before the date that such Withholding Certificate expires or becomes
obsolete or after the occurrence of any event requiring a change in the most
recent Withholding Certificate so delivered by it, and such amendments thereto
or extensions or renewals thereof as may be reasonably requested by the Borrower
or the Administrative Agent. Notwithstanding the submission of a Withholding
Certificate claiming a reduced rate of or exemption
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from U.S. withholding tax, the Administrative Agent shall be entitled to
withhold United States federal income taxes at the full 30% withholding rate if
in its reasonable judgment it is required to do so under the due diligence
requirements imposed upon a withholding agent under Section 1.1441-7(b) of the
Regulations. Further, the Agent is indemnified under Section 1.1461-1(e) of the
Regulations against any claims and demands of any Lender or assignee or
participant of a Lender for the amount of any tax it deducts and withholds in
accordance with regulations under Section 1441 of the Internal Revenue Code.
Section 10.18 Joinder of Guarantors. Any Subsidiary of the Borrower which
is required to join this Agreement as a Guarantor pursuant to Section 7.02(h)
[Subsidiaries, Partnerships and Joint Ventures] shall execute and deliver to the
Agent (i) a Guarantor Joinder in substantially the form attached hereto as
Exhibit 1.01(G)(1) pursuant to which it shall join as a Guarantor each of the
documents to which the Guarantors are parties; and (ii) documents in the forms
described in Section 6.01 [First Loans] modified as appropriate to relate to
such Subsidiary. The Loan Parties shall deliver such Guarantor Joinder and
related documents to the Agent within five (5) Business Days after the date of
the filing of such Subsidiary's articles of incorporation if the Subsidiary is a
corporation, the date of the filing of its certificate of limited partnership if
it is a limited partnership or the date of its organization if it is an entity
other than a limited partnership or corporation.
[SIGNATURE PAGES FOLLOW]
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[SIGNATURE PAGE 1 OF 9 TO CREDIT AGREEMENT]
IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly
authorized, have executed this Agreement as of the day and year first above
written.
ATTEST: TOO, INC.
By: /s/ Xxxx Xxxxxxxxxx
-------------------
Name: Xxxx Xxxxxxxxxx
Title: EVP COO CFO
GUARANTORS
AMERICAN FACTORING, INC.
By: /s/ Xxxx Xxxxxxxxxx
-------------------
Name: Xxxx Xxxxxxxxxx
Title: President
FLORET, LLC
By: /s/ Xxxxxxx XxXxxxxx
--------------------
Name: Xxxxxxx XxXxxxxx
Title: President
LT HOLDING, INC.
By: /s/ Xxxx Xxxxxxxxxx
-------------------
Name: Xxxx Xxxxxxxxxx
Title: President CEO Treasurer
LT IMPORT CORP.
By: /s/ Xxxxxx Xxxxxxxxx
--------------------
Name: Xxxxxx Xxxxxxxxx
Title: President CEO
[SIGNATURE PAGE 2 OF 9 TO CREDIT AGREEMENT]
LIMITED TOO CATALOG
PRODUCTION, INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------
Name: Xxxxxx X. Xxxxx
Title: President & CEO
LIMITED TOO CREATIVE DESIGN, INC.
By: /s/ Xxxxxx Xxxxx
----------------
Name: Xxxxxx Xxxxx
Title: President, CEO
LIMITED TOO DIRECT, LLC
By: /s/ Xxxxx Xxxxxxx
-----------------
Name: Xxxxx Xxxxxxx
Title: President,
Chief Executive Officer
LIMITED TOO PURCHASING, INC.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------
Name: Xxxxxxx X. Xxxxxx
Title: President, CEO
LIMITED TOO STORE PLANNING, INC.
By: /s/ Xxxx Xxxxxx
---------------
Name: Xxxx Xxxxxx
Title: President
MISH MASH, LLC
By: /s/ Xxxx Xxxxxxxxxx
-------------------
Name: Xxxx Xxxxxxxxxx
Title: Vice President,
Secretary Treasurer
-2-
[SIGNATURE PAGE 3 OF 9 TO CREDIT AGREEMENT]
TOO GC, LLC
By: /s/ Xxxx Xxxxxxxxxx
-------------------
Name: Xxxx Xxxxxxxxxx
Title: President, Secretary
TOO BRANDS, INC.
By: /s/ Xxxx Xxxxxxxxxx
-----------------------
Name: Xxxx Xxxxxxxxxx
Title: President CEO Treasurer
TOO BRANDS INVESTMENT, LLC
By: /s/ Xxxx Xxxxxxxxxx
-------------------
Name: Xxxx Xxxxxxxxxx
Title: President CEO Treasurer
TOO IMPORT, LLP
By: /s/ Xxxxxx Xxxxxxxxx
--------------------
Name: Xxxxxx Xxxxxxxxx
Title: President, CEO
[SIGNATURE PAGE 4 OF 9 TO CREDIT AGREEMENT]
NATIONAL CITY BANK, individually
and as Agent
By: /s/ Xxxxxx X. Xxxxxx
--------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
[SIGNATURE PAGE 5 OF 9 TO CREDIT AGREEMENT]
FIFTH THIRD BANK
By: /s/ Xxx Xxxxxx
--------------
Name: Xxx Xxxxxx
Title: Assistant Vice President
[SIGNATURE PAGE 6 OF 9 TO CREDIT AGREEMENT]
LASALLE BANK NATIONAL ASSOCIATION
By: /s/ Xxxxxx X. Xxxxx
-------------------
Name: Xxxxxx X. Xxxxx
Title: First Vice President
[SIGNATURE PAGE 7 OF 9 TO CREDIT AGREEMENT]
FLEET NATIONAL BANK
By: /s/ Xxxxxx X.X. Xxxxx
---------------------
Name: Xxxxxx X.X. Xxxxx
Title: Managing Director
[SIGNATURE PAGE 8 OF 9 TO CREDIT AGREEMENT]
THE HUNTINGTON NATIONAL BANK
By: /s/ Xxxx X. Xxxxxxxx
--------------------
Name: Xxxx X. Xxxxxxxx
Title: Vice President
[SIGNATURE PAGE 9 OF 9 TO CREDIT AGREEMENT]
BANK OF AMERICA, N.A.
By: /s/ Xxx Xxxxxxx
---------------
Name: Xxx Xxxxxxx
Title: Managing Director
