Exhibit 4.5
CREDIT AGREEMENT DATED AS OF APRIL 10, 2001 1
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms..........................................2
SECTION 1.02. Computation of Time Periods; Other
Definitional Provisions.......................................41
SECTION 1.03. Accounting Terms..............................................41
ARTICLE II AMOUNTS AND TERMS OF THE ADVANCES and the letters of credit
SECTION 2.01. The Advances and the Letter of Credit.........................41
SECTION 2.02. Making the Advances...........................................43
SECTION 2.03. Issuance of and Drawings and Reimbursement Under
Letters of Credit.............................................46
SECTION 2.04. Repayment of Advances.........................................48
SECTION 2.05. Termination or Reduction of the Commitments...................53
SECTION 2.06. Prepayments..................................................54
SECTION 2.07. Interest......................................................57
SECTION 2.08. Fees..........................................................58
SECTION 2.09. Conversion of Advances........................................59
SECTION 2.10. Increased Costs, Etc..........................................59
SECTION 2.11. Payments and Computations.....................................62
SECTION 2.12. Taxes.........................................................63
SECTION 2.13. Sharing of Payments, Etc......................................66
SECTION 2.14. Use of Proceeds...............................................67
SECTION 2.15. Defaulting Lenders............................................67
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SECTION 2.16. Evidence of Debt..............................................70
SECTION 2.17. Increase in the Tranche B Term Commitments....................71
ARTICLE III CONDITIONS OF LENDING AND ISSUANCES OF LETTERS OF CREDIT
SECTION 3.01. Conditions Precedent to Initial Extension of Credit......73 2 ii
SECTION 3.02. Conditions Precedent to Each Borrowing and
Issuance and Renewal..........................................77
SECTION 3.03. Determinations Under Section 3.01.............................78
ARTICLE IV REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the
Borrowers and the Parent......................................78
ARTICLE V COVENANTS OF THE PARENT
SECTION 5.01. Affirmative Covenants.........................................86
SECTION 5.02. Negative Covenants............................................93
SECTION 5.03. Reporting Requirements.......................................104
SECTION 5.04. Financial Covenants..........................................108
ARTICLE VI EVENTS OF DEFAULT
SECTION 6.01. Events of Default............................................110
SECTION 6.02. Actions in Respect of the Letters of Credit upon Default.....113
ARTICLE VII THE AGENTS
SECTION 7.01. Authorization and Action.....................................114
SECTION 7.02. Agents' Reliance, Etc........................................114
SECTION 7.03. MSSF, CSFB and Affiliates....................................115
SECTION 7.04. Lender Party Credit Decision.................................115
SECTION 7.05. Indemnification..............................................115
SECTION 7.06. Successor Agents.............................................117
SECTION 7.07. Collateral Agent acting as Joint Creditor....................118
SECTION 7.08. Co-Documentation Agents and Syndication Agent..........118 3 iii
ARTICLE VIII GUARANTY
SECTION 8.01. Guaranty; Limitation of Liability............................118
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SECTION 8.02. Guaranty Absolute............................................119
SECTION 8.03. Waivers and Acknowledgments..................................120
SECTION 8.04. Subrogation..................................................121
SECTION 8.05. Guaranty Supplements.........................................122
SECTION 8.06. Continuing Guaranty; Assignments.............................122
SECTION 8.07. Release of Guarantor.........................................123
SECTION 8.08. Payment......................................................123
ARTICLE IX MISCELLANEOUS
SECTION 9.01. Amendments, Etc..............................................124
SECTION 9.02. Notices, Etc.................................................125
SECTION 9.03. No Waiver; Remedies..........................................125
SECTION 9.04. Costs and Expenses...........................................125
SECTION 9.05. Right of Set-off.............................................127
SECTION 9.06. Binding Effect...............................................127
SECTION 9.07. Assignments and Participations...............................127
SECTION 9.08. Execution in Counterparts....................................131
SECTION 9.09. No Liability of the Issuing Bank.............................131
SECTION 9.10. Confidentiality..............................................132
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SECTION 9.11. Release of Collateral........................................132
SECTION 9.12. Judgment.....................................................132
SECTION 9.13. Jurisdiction, Etc............................................133
SECTION 9.14. Substitution of Currency.....................................134
SECTION 9.15. Governing Law................................................134
SECTION 9.16. Waiver of Jury Trial.........................................134
SCHEDULES Schedule I - Commitments and Applicable Lending Offices Schedule II
- Subsidiary Guarantors Schedule III - Associated Costs Schedule 4.01(b) -
Subsidiaries Schedule 4.01(d) - Authorizations, Approvals, Actions, Notices
and Filings Schedule 4.01(f) - Disclosed Litigation 4 iv Schedule 4.01(o) -
Plans, Multiemployer Plans and Welfare Plans Schedule 4.01(p) - Environmental
Disclosure Schedule 4.01(s) - Existing Debt Schedule 4.01(t) - Surviving Debt
Schedule 4.01(u) - Liens Schedule 4.01(v) - Owned Real Property Schedule
4.01(w) - Leased Real Property Schedule 4.01(x) - Investments Schedule 4.01(y)
- Intellectual Property 5 v EXHIBITS Exhibit A-1 - Form of Revolving Credit
Note Exhibit A-2 - Form of Tranche A U.S. Term Note Exhibit A-3 - Form of
Tranche A Euro Term Note Exhibit A-4 - Form of Tranche B Term Note Exhibit B -
Form of Notice of Borrowing Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Security Agreement Exhibit E - Form of Mortgage Exhibit F
- Form of Solvency Certificate Exhibit G - Form of Opinion of United States
Counsel to the Loan Parties Exhibit H - Form of Guaranty Supplement Exhibit I
- Form of Opinion of Local Counsel to the Loan Parties 6 EXHIBIT 4.5 CREDIT
AGREEMENT CREDIT AGREEMENT dated as of April 10, 2001 among DRESSER, INC., a
Delaware corporation (the "U.S. BORROWER"), D.I. LUXEMBOURG S.A.R.L., a
corporation organized and existing under the laws of Luxembourg (the "EURO
BORROWER", and, collectively with the U.S. Borrower, the "BORROWERS"), DEG
ACQUISITIONS, LLC, a limited liability company organized and existing under the
laws of Delaware (the "PARENT"), the Subsidiary Guarantors (as hereinafter
defined), the banks, financial institutions and other institutional lenders
listed on the signature pages hereof as the Initial Lenders (the "INITIAL
LENDERS"), the bank listed on the signature pages hereof as the Initial Issuing
Bank (the "INITIAL ISSUING BANK") and XXXXX FARGO BANK TEXAS, N.A., as the swing
line bank (in such capacity and any successor swing line bank, the "SWING LINE
BANK"), XXXXXX XXXXXXX & CO. INCORPORATED ("MS & CO."), as collateral agent
(together with any successor collateral agent appointed pursuant to Article VII,
the "COLLATERAL AGENT"), XXXXXX XXXXXXX SENIOR FUNDING, INC. ("MSSF"), as
administrative agent (together with any successor administrative agent appointed
pursuant to Article VII, the "ADMINISTRATIVE AGENT") for the Lender Parties (as
hereinafter defined), and CREDIT SUISSE FIRST BOSTON ("CSFB"), as syndication
agent (the "SYNDICATION AGENT", and together with the Collateral Agent and the
Administrative Agent, the "AGENTS"). PRELIMINARY STATEMENTS: 1. Pursuant to the
Amended and Restated Agreement and Plan of Recapitalization dated January 30,
2001, as amended and restated April 10, 2001 (as the same may be further
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amended, modified or otherwise supplemented from time to time to the extent
permitted under Section 5.02(p), the "AGREEMENT AND PLAN OF RECAPITALIZATION")
among Halliburton Company, a Delaware corporation, Dresser B.V., a Netherlands
company, and the Parent, the Parent has agreed to enter into the
recapitalization transaction and other related transactions described therein
(the "RECAPITALIZATION"). 2. The Borrowers have requested that, concurrently
with and subject to the consummation of the First Closing (as defined in the
Agreement and Plan of Recapitalization) with respect to the Recapitalization,
the Lender Parties lend to the Borrowers up to U.S.$820,000,000, consisting of
U.S.$165,000,000 under the Tranche A U.S. Term Facility (as hereinafter defined)
extended to the U.S. Borrower, the Equivalent in Euros of U.S.$100,000,000 under
the Tranche A Euro Term Facility (as hereinafter defined) extended to the Euro
Borrower, U.S.$455,000,000 under the Tranche B Term Facility (as hereinafter
defined) extended to the U.S. Borrower and up to U.S.$100,000,000 under the
Revolving Credit Facility (as hereinafter defined) for the benefit of the U.S.
Borrower to finance the Recapitalization, repay any Existing Debt (as
hereinafter defined), pay transaction fees and costs and that, from time to
time, the Lender Parties lend to the U.S. Borrower and issue Letters of Credit
for the account of the U.S. Borrower to provide revolving credit for the U.S.
Borrower and its Subsidiaries. The Lender 7 2 Parties have indicated their
willingness to agree to lend such amounts on the terms and conditions of this
Agreement. NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties hereto hereby agree as
follows: ARTICLE I DEFINITIONS AND ACCOUNTING TERMS SECTION 1.01. Certain
Defined Terms. As used in this Agreement, the following terms shall have the
following meanings (such meanings to be equally applicable to both the singular
and plural forms of the terms defined): "ADMINISTRATIVE AGENT" has the meaning
specified in the recital of parties to this Agreement. "ADMINISTRATIVE AGENT'S
ACCOUNT" means the account of the Administrative Agent maintained by the
Administrative Agent as the Administrative Agent shall specify in writing to the
Lender Parties. "ADVANCE" means a Tranche A U.S. Term Advance, a Tranche A Euro
Term Advance, a Tranche B Term Advance, a Revolving Credit Advance, a Swing Line
Advance or a Letter of Credit Advance. "AFFILIATE" means, as to any Person, any
other Person that, directly or indirectly, controls, is controlled by or is
under common control with such Person or is a director or officer of such
Person. For purposes of this definition, the term "control" (including the terms
"controlling", "controlled by" and "under common control with") of a Person
means the possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of Voting Interests, by contract or otherwise. "AGENTS" has the
meaning specified in the recital of parties to this Agreement. "AGREEMENT AND
PLAN OF RECAPITALIZATION" has the meaning specified in the Preliminary
Statements. "AGREEMENT VALUE" means, for each Hedge Agreement, on any date of
determination, an amount determined by the Administrative Agent equal to: (a) in
the case of a Hedge Agreement documented pursuant to the Master Agreement
(Multicurrency-Cross Border) published by the International Swap and Derivatives
Association, Inc. (the "MASTER AGREEMENT"), the amount, if any, that would be
payable by 8 3 any Loan Party or any of its Subsidiaries to its counterparty to
such Hedge Agreement, as if (i) such Hedge Agreement was being terminated early
on such date of determination, (ii) such Loan Party or Subsidiary was the sole
"Affected Party", and (iii) the Administrative Agent was the sole party
determining such payment amount (with the Administrative Agent making such
determination pursuant to the provisions of the form of Master Agreement); or
(b) in the case of a Hedge Agreement traded on an exchange, the xxxx-to-market
value of such Hedge Agreement, which will be the unrealized loss on such Hedge
Agreement to the Loan Party or Subsidiary of a Loan Party to such Hedge
Agreement determined by the Administrative Agent based on the settlement price
of such Hedge Agreement on such date of determination, or (c) in all other
cases, the xxxx-to-market value of such Hedge Agreement, which will be the
unrealized loss on such Hedge Agreement to the Loan Party or Subsidiary of a
Loan Party to such Hedge Agreement determined by the Administrative Agent as the
amount, if any, by which (i) the present value of the future cash flows to be
paid by such Loan Party or Subsidiary exceeds (ii) the present value of the
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future cash flows to be received by such Loan Party or Subsidiary pursuant to
such Hedge Agreement; capitalized terms used and not otherwise defined in this
definition shall have the respective meanings set forth in the above described
Master Agreement. "APPLICABLE BORROWER" means, (a) with respect to the Tranche A
U.S. Term Facility, the Tranche B Term Facility, the Revolving Credit Facility,
the Swing Line Facility or the Letter of Credit Facility or any Advances or
Borrowings thereunder, the U.S. Borrower and (b) with respect to the Tranche A
Euro Term Facility or any Advances or Borrowings thereunder, the Euro Borrower.
"APPLICABLE CURRENCY" means, (a) with respect to the Tranche A U.S. Term
Facility, the Tranche B Term Facility, the Revolving Credit Facility, the Swing
Line Facility or the Letter of Credit Facility or any Advances, Borrowings or
Letters of Credit thereunder, Dollars and (b) with respect to the Tranche A Euro
Term Facility or any Advances or Borrowings thereunder, Euros. "APPLICABLE
LENDING OFFICE" means, with respect to each Lender Party, (i) such Lender
Party's Domestic Lending Office in the case of a Base Rate Advance, (ii) such
Lender Party's Eurodollar Lending Office in the case of a Eurodollar Rate
Advance, and (iii) such Lender Party's Euro Lending Office in the case of a Euro
Rate Advance. "APPLICABLE MARGIN" means (A) in respect of the Tranche B Term
Loan Facility, during the period from the Effective Date until the six-month
anniversary of the Effective Date, 2.50% per annum for Base Rate Advances and
3.50% for Eurodollar Rate Advances, and thereafter a percentage per annum
determined by reference to the Total Debt/EBITDA Ratio as set forth below: 9 4
================================================= TOTAL DEBT/EBITDA BASE RATE
EURODOLLAR RATE RATIO ADVANCES ADVANCES
================================================= Level I less than 2.50:1.00
2.00% 3.00% ------------------------------------------------- Level II
2.50:1.00 or greater, but less than 3.00:1.00 2.25% 3.25%
------------------------------------------------- Level III 3.00:1.00 or
greater, but less than 3.50:1.00 2.25% 3.25%
------------------------------------------------- Level IV 3.50:1.00 or
greater, but less than 4.00:1.00 2.50% 3.50%
------------------------------------------------- Level V 4.00:1.00 or
greater, but less than 4.50:1.00 2.50% 3.50%
------------------------------------------------- Level VI 4.50:1.00 or
greater 2.75% 3.75% ================================================ ; and (B)
in respect of the Tranche A U.S. Term Facility, the Tranche A Euro Term Facility
and the Revolving Credit Facility, during the period from the Effective Date
until the six-month anniversary of the Effective Date, 2.00% per annum for the
Base Rate Advances, 3.00% per annum for Eurodollar Rate Advances, 3.00% per
annum for Euro Rate Advances, and thereafter a percentage per annum determined
by reference to the Total Debt/EBITDA Ratio as set forth below: 10 5
============================================================= TOTAL
DEBT/EBITDA BASE RATE EURODOLLAR RATE EURO RATE RATIO ADVANCES ADVANCES
ADVANCES ============================================================= Level I
less than 2.50:1.00 1.00% 2.00% 2.00%
------------------------------------------------------------- Level II
2.50:1.00 or greater, but less than 3.00:1.00 1.25% 2.25% 2.25%
------------------------------------------------------------- Level III
3.00:1.00 or greater, but less than 3.50:1.00 1.50% 2.50% 2.50%
------------------------------------------------------------- Level IV
3.50:1.00 or greater, but less than 4.00:1.00 1.75% 2.75% 2.75%
------------------------------------------------------------- Level V
4.00:1.00 or greater, but less than 4.50:1.00 2.00% 3.00% 3.00%
------------------------------------------------------------- Level VI
4.50:1.00 or greater 2.25% 3.25% 3.25%
============================================================= The Applicable
Margin shall be determined by reference to the Total Debt/EBITDA Ratio in effect
from time to time; provided, however, that (i) no change in the Applicable
Margin shall be effective until three Business Days after the date on which the
Administrative Agent receives the financial statements required to be delivered
pursuant to Section 5.03(b) or (c), as the case may be, and a certificate of the
Chief Financial Officer of the U.S. Borrower demonstrating such Total
Debt/EBITDA Ratio and (ii) the Applicable Margin shall be at Level VI for so
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long as the U.S. Borrower has not submitted to the Administrative Agent the
information described in clause (i) of this proviso as and when required under
Section 5.03(b) or (c), as the case may be. The Applicable Margin at any time
with respect to Swing Line Advances held by the Swing Line Bank shall be equal
to the Applicable Margin as set forth above for Revolving Credit Advances less
1.00% per annum. 11 6 "APPLICABLE PERCENTAGE" means (a) during the period from
the Effective Date until the six-month anniversary of the Effective Date, 0.50%
per annum and (b) thereafter a percentage per annum determined by reference to
the Total Debt/EBITDA Ratio as set forth below:
--------------------------------------- TOTAL DEBT/EBITDA RATIO COMMITMENT FEE
--------------------------------------- Level I less than 2.50:1.00 .375%
--------------------------------------- Level II 2.50:1.00 or greater .50%
--------------------------------------- The Applicable Percentage shall be
determined by reference to the Total Debt/EBITDA Ratio in effect from time to
time; provided, however, that (A) no change in the Applicable Percentage shall
be effective until three Business Days after the date on which the
Administrative Agent receives the financial statements required to be delivered
pursuant to Section 5.03(b) or (c), as the case may be, and a certificate of the
Chief Financial Officer of the U.S. Borrower demonstrating such Total
Debt/EBITDA Ratio, and (B) the Applicable Percentage shall be at Level II for so
long as the U.S. Borrower has not submitted to the Administrative Agent the
information described in clause (A) of this proviso as and when required under
Section 5.03(b) or (c), as the case may be. "APPROPRIATE LENDER" means, at any
time, with respect to (a) any of the Tranche A U.S. Term, Tranche A Euro Term,
Tranche B Term or Revolving Credit Facilities, a Lender that has a Commitment
with respect to such Facility at such time, (b) the Swing Line Facility, (i) the
Swing Line Bank and (ii) if the other Revolving Credit Lenders have made Swing
Line Advances pursuant to Section 2.02(b) that are outstanding at such time,
each such other Revolving Credit Lender and (c) the Letter of Credit Facility,
(i) the Issuing Bank and (ii) if the other Revolving Credit Lenders have made
Letter of Credit Advances pursuant to Section 2.03(c) that are outstanding at
such time, each such other Revolving Credit Lender. "APPROVED FUND" means, with
respect to any Lender that is a fund that invests in bank loans, any other fund
that invests in bank loans and is advised or managed by the same investment
advisor as such Lender or by an Affiliate of such investment advisor. "ASSET
SALES" shall, with respect to the U.S. Borrower and its Subsidiaries, have the
meaning specified in the Indenture. "ASSIGNMENT AND ACCEPTANCE" means an
assignment and acceptance entered into by a Lender Party and an Eligible
Assignee, and accepted by the Administrative Agent, in accordance with Section
9.07 and in substantially the form of Exhibit C hereto. "ASSOCIATED COSTS" shall
mean the cost imputed to each Tranche A Euro Term Lender of compliance with (a)
the cash ratios and special deposit requirements of the 12 7 Bank of England
and/or the banking supervision or other costs imposed by the Financial Services
Authority, as determined in accordance with Schedule III, and (b) any reserve
asset requirements of the European Central Bank. "ASSUMING LENDER" has the
meaning specified in Section 2.17(d). "ASSUMPTION AGREEMENT" has the meaning
specified in Section 2.17(d). "AVAILABLE AMOUNT" of any Letter of Credit means,
at any time, the maximum amount available to be drawn under such Letter of
Credit at such time (assuming compliance at such time with all conditions to
drawing). "BACKLOG" means, at any time, the aggregate amount payable by
customers under all orders or contracts for the delivery of goods or services
that are to be, but have not yet been, delivered or supplied by any of the
Foreign Subsidiaries in the ordinary course of business. "BASE RATE" means a
fluctuating interest rate per annum in effect from time to time, which rate per
annum shall at all times be equal to the higher of: (a) the rate of interest
announced publicly by Citibank, N.A. in New York, New York, from time to time,
as Citibank, N.A.'s base rate; and (b) 1/2 of 1% per annum above the Federal
Funds Rate. "BASE RATE ADVANCE" means an Advance that bears interest as provided
in Section 2.07(a)(i). "BORROWER'S ACCOUNT" means (a) with respect to the U.S.
Borrower, the account of the U.S. Borrower maintained by the U.S. Borrower with
Citibank, N.A. at its office at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Account No. 00000000, or such other account as the U.S. Borrower shall specify
in writing to the Administrative Agent, and (b) with respect to the Euro
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Borrower, the account of the Euro Borrower maintained by the Euro Borrower with
Citibank, N.A. at its offices at 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000, Account
No. 00000000, or such other account as the Euro Borrower shall specify in
writing to the Administrative Agent. "BORROWERS" has the meaning specified in
the recital of parties to this Agreement. "BORROWING" means a Tranche A U.S.
Term Borrowing, a Tranche A Euro Term Borrowing, a Tranche B Term Borrowing, a
Revolving Credit Borrowing or a Swing Line Borrowing. "BUSINESS DAY" means a day
of the year on which banks are not required or authorized by law to close in New
York City and, (x) if the applicable Business Day 13 8 relates to any Eurodollar
Rate Advances, a day on which dealings are carried on in the London interbank
market, and (y) if the applicable Business Day relates to any Euro Rate
Advances, a day on which the Trans-European Automated Real-Time Gross Settlement
Express Transfer (TARGET) Payment System is open. "CAPITAL EXPENDITURES" means,
for any Person for any period, the sum of, without duplication, (a) all
expenditures made in cash by such Person or any of its Subsidiaries during such
period for equipment, tangible fixed assets, real property or improvements, or
for replacements or substitutions therefor or additions thereto, that have been
or should be, in accordance with GAAP, reflected as additions to property, plant
or equipment on a Consolidated balance sheet of such Person plus (b) the
aggregate principal amount of all Debt (including Obligations under Capitalized
Leases) assumed or incurred to finance any such expenditures that were not made
in cash, except in each case any such expenditures made or recorded as part of a
Permitted Acquisition or the Pending Acquisition. "CAPITALIZED LEASES" means all
leases that have been or should be, in accordance with GAAP, recorded as
capitalized leases. "CASH EQUIVALENTS" means any of the following, to the extent
owned by any of the Borrowers or any of their respective Subsidiaries free and
clear of all Liens other than Liens created under the Collateral Documents: (a)
any evidence of indebtedness, maturing not more than 365 days after the date of
the purchase, issued by the United States of America or any instrumentality or
agency thereof, the principal, interest and premium, if any, of which is
guaranteed fully by, or backed by the full faith and credit of, the United
States of America, (b) Dollar denominated (or foreign currency fully hedged)
time deposits, certificates of deposits and bankers acceptances maturing not
more than 365 days after the date of purchase, issued by (x) any Lender or (y) a
commercial banking institution that is a member of the U.S. Federal Reserve
System or a commercial banking institution organized and located in a country
recognized by the United States of America having, or which is the principal
banking subsidiary of a bank holding company having, combined capital and
surplus and undivided profits of not less than $200,000,000 and a commercial
paper rating of "P-1" (or higher) according to Xxxxx'x Investors' Service, Inc.
("MOODY'S"), "A-1" (or higher) according to Standard & Poor's Ratings Service, a
division of The XxXxxx-Xxxx Companies, Inc. ("S&P") or the equivalent rating by
any other nationally recognized rating agency at the time as of which any
investment therein is made (any such bank, an "APPROVED BANK") or (z) a
non-United States commercial banking institution which is either currently
ranked among the 100 largest banks in the world (by assets, according to the
American Banker), has combined capital and surplus and undivided profits of not
less than $500,000,000 or whose commercial paper (or the commercial paper of
such bank's holding company) has a rating of "P-1" (or higher) according to
Moody's, "A-1" (or higher) according to S&P or the equivalent rating by any
other nationally recognized rating agency at the time as of 14 9 which any
investment therein is made, (c) commercial paper, maturing not more than 365
days after the date of purchase, issued or guaranteed by a corporation with a
rating, at the time as of which any determination thereof is to be made, of
"P-1" (or higher) according to Moody's, or "A-1" (or higher) according to S&P,
(d) demand deposits with any bank or trust company maintained in the ordinary
course of business, (e) repurchase or reverse repurchase agreements covering
obligations of the type specified in clause (a) with a term of not more than
seven days with any Approved Bank and (f) shares of any money market mutual fund
rated at least "AAA" or the equivalent thereof by S&P or at least "Aaa" or the
equivalent thereof by Moody's at the time as of which any investment therein is
made. "CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended from time to time. "CERCLIS" means the
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Comprehensive Environmental Response, Compensation and Liability Information
System maintained by the U.S. Environmental Protection Agency. "CFC" means any
entity that is a controlled foreign corporation under Section 957 of the
Internal Revenue Code (or any successor provision thereto). "CHANGE OF CONTROL"
means the occurrence of any of the following: (a) the Permitted Investors and
their Related Parties cease to own, directly or indirectly, more than 50% of the
Voting Interests of the U.S. Borrower, or (b) the first date during any
consecutive two-year period on which a majority of the members of the board of
directors of the Parent are not Continuing Directors, or (c) prior to an IPO,
the Parent shall cease to own at least 90% of the Voting Interests, other than
Excluded Voting Interests, in each of the Borrowers (provided that the Parent
shall in no event cease to own more than 50% of the Voting Interests in the U.S.
Borrower on a fully diluted basis (such percentage to be calculated taking into
account the Excluded Voting Interests), or (d) after an IPO, the Parent shall
cease to own more than 50% of the Voting Interests in the U.S. Borrower.
"COLLATERAL" means all "Collateral" referred to in the Collateral Documents and
all other property that is or is intended under any Collateral Document to be
subject to any Lien in favor of the Collateral Agent for the benefit of the
Secured Parties. "COLLATERAL AGENT" has the meaning specified in the recital of
parties to this Agreement. "COLLATERAL DOCUMENTS" means the Security Agreement,
the Mortgages, the Non-U.S. Security Documents and any other agreement executed
by any Loan Party that creates or purports to create a Lien in favor of the
Collateral Agent for the benefit of the Secured Parties. 15 10 "COMMITMENT"
means a Tranche A U.S. Term Commitment, a Tranche A Euro Term Commitment, a
Tranche B Term Commitment, a Revolving Credit Commitment or a Letter of Credit
Commitment. "COMMITMENT DATE" has the meaning specified in Section 2.17(b).
"COMMITMENT INCREASES" has the meaning specified in Section 2.17(a).
"CONFIDENTIAL INFORMATION" means information that any Loan Party furnishes to
any Agent or any Lender Party on a confidential basis, but does not include any
such information that is or becomes generally available to the public or that is
or becomes available to such Agent or such Lender Party from a source other than
the Loan Parties. "CONSOLIDATED" refers to the consolidation of accounts in
accordance with GAAP. "CONTINGENT OBLIGATION" means, with respect to any Person,
any Obligation or arrangement of such Person to guarantee or intended to
guarantee any Debt, leases, dividends or other payment Obligations ("PRIMARY
OBLIGATIONS") of any other Person (the "PRIMARY OBLIGOR") in any manner, whether
directly or indirectly, including, without limitation, (a) the direct or
indirect guarantee, endorsement (other than for collection or deposit in the
ordinary course of business), co-making, discounting with recourse or sale with
recourse by such Person of the Obligation of a primary obligor, (b) the
Obligation to make take-or-pay or similar payments, if required, regardless of
nonperformance by any other party or parties to an agreement or (c) any
Obligation of such Person, whether or not contingent, (i) to purchase any such
primary obligation or any property constituting direct or indirect security
therefor, (ii) to advance or supply funds (A) for the purchase or payment of any
such primary obligation or (B) to maintain revolving credit or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase property, assets, securities or services
primarily for the purpose of assuring the owner of any such primary obligation
of the ability of the primary obligor to make payment of such primary obligation
or (iv) otherwise to assure or hold harmless the holder of such primary
obligation against loss in respect thereof. The amount of any Contingent
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Contingent Obligation
is made (or, if less, the maximum amount of such primary obligation for which
such Person may be liable pursuant to the terms of the instrument evidencing
such Contingent Obligation) or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof (assuming such Person is
required to perform thereunder), as determined by such Person in good faith.
"CONTINUING DIRECTORS" means (i) members of the board of directors on the
Effective Date; and (ii) other Persons nominated or elected to the board of
directors with the approval of a majority of the Continuing Directors who were
members of the board of directors at the time of such election or nomination. 16
Page 9
11 "CONVERSION", "CONVERT" and "CONVERTED" each refer to a conversion of
Advances of one Type into Advances of the other Type pursuant to Section 2.09 or
2.10. "CSFB" has the meaning specified in the recital of parties hereto.
"CURRENT ASSETS" of any Person means all assets of such Person that would, in
accordance with GAAP, be classified as current assets of a company conducting a
business the same as or similar to that of such Person, after deducting any
reserve required by GAAP in each case in which a reserve is proper in accordance
with GAAP. "CURRENT LIABILITIES" of any Person means, as of any date (a) all
Debt of such Person that by its terms is payable on demand or matures within one
year after such date (excluding (i) any Debt renewable or extendible, at the
option of such Person, to a date more than one year from such date or arising
under a revolving credit or similar agreement that obligates the lender or
lenders to extend credit during a period of more than one year from such date,
and (ii) all amounts of other Funded Debt of such Person required to be paid or
prepaid within one year after such date), and (b) all other items (including
taxes accrued as estimated) that in accordance with GAAP would be classified as
current liabilities of such Person. "DEBT" of any Person means (a) all
indebtedness of such Person for borrowed money, (b) all Obligations of such
Person for the deferred purchase price of property or services (other than trade
payables and other operating liabilities not overdue by more than 120 days or
being disputed in good faith in each case incurred in the ordinary course of
such Person's business), (c) all Obligations of such Person evidenced by notes,
bonds, debentures or other similar instruments, (d) all Obligations of such
Person created or arising under any conditional sale or other title retention
agreement with respect to property acquired by such Person (even though the
rights and remedies of the seller or lender under such agreement in the event of
default are limited to repossession or sale of such property), except agreements
for the purchase of property in the ordinary cause of business and on current
payment terms solely to the extent such agreements shall not be overdue by more
than 120 days or being disputed in good faith, (e) all Obligations of such
Person as lessee under Capitalized Leases, (f) all Obligations of such Person
under acceptance, letter of credit or similar credit facilities, (g) all
Obligations of such Person to purchase, redeem, retire, defease or otherwise
make any payment in respect of any Equity Interests in such Person or any
Affiliate of such Person or any warrants, rights or options to acquire such
Equity Interests, valued, in the case of Redeemable Preferred Interests, at the
greater of its voluntary or involuntary liquidation preference plus accrued and
unpaid dividends, except (in each case) Qualified Preferred Stock, (h) all
Obligations of such Person in respect of Hedge Agreements, valued at the
Agreement Value thereof, (i) all Contingent Obligations of such Person incurred
by such Person with respect to any indebtedness and other payment Obligations
referred to in clauses (a) through (h) above and (j) all indebtedness and other
payment Obligations referred to in clauses (a) through (i) above of another
Person secured by (or for which the holder of such Debt has an 17 12 existing
right, contingent or otherwise, to be secured by) any Lien on property
(including, without limitation, accounts and contract rights) owned by such
Person, even though such Person has not assumed or become liable for the payment
of such indebtedness or other payment Obligations. "DEBT FOR BORROWED MONEY" of
any Person means all items of Debt that, in accordance with GAAP, would be
classified as indebtedness on a Consolidated balance sheet of such Person and
the amount thereof at any time shall be the amount then required by GAAP to be
shown on such balance sheet. "DEFAULT" means any Event of Default or any event
that would constitute an Event of Default but for the requirement that notice be
given or time elapse or both. "DEFAULTED ADVANCE" means, with respect to any
Lender Party at any time, the portion of any Advance required to be made by such
Lender Party to a Borrower pursuant to Section 2.01 or 2.02 at or prior to such
time that has not been made by such Lender Party or by the Administrative Agent
for the account of such Lender Party pursuant to Section 2.02(e) as of such
time. In the event that a portion of a Defaulted Advance shall be deemed made
pursuant to Section 2.15(a), the remaining portion of such Defaulted Advance
shall be considered a Defaulted Advance originally required to be made pursuant
to Section 2.01 on the same date as the Defaulted Advance so deemed made in
part. "DEFAULTED AMOUNT" means, with respect to any Lender Party at any time,
Page 10
any amount required to be paid by such Lender Party to any Agent or any other
Lender Party hereunder or under any other Loan Document at or prior to such time
that has not been so paid as of such time, including, without limitation, any
amount required to be paid by such Lender Party to (a) the Swing Line Bank
pursuant to Section 2.02(b) to purchase a portion of a Swing Line Advance made
by the Swing Line Bank, (b) the Issuing Bank pursuant to Section 2.03(c) to
purchase a portion of a Letter of Credit Advance made by the Issuing Bank, (c)
the Administrative Agent pursuant to Section 2.02(e) to reimburse the
Administrative Agent for the amount of any Advance made by the Administrative
Agent for the account of such Lender Party, (d) any other Lender Party pursuant
to Section 2.15 to purchase any participation in Advances owing to such other
Lender Party and (e) any Agent or the Issuing Bank to reimburse such Agent or
the Issuing Bank for such Lender Party's ratable share of any amount required to
be paid by the Lender Parties to such Agent or the Issuing Bank. In the event
that a portion of a Defaulted Amount shall be deemed paid pursuant to Section
2.15(b), the remaining portion of such Defaulted Amount shall be considered a
Defaulted Amount originally required to be paid hereunder or under any other
Loan Document on the same date as the Defaulted Amount so deemed paid in part.
18 13 "DEFAULTING LENDER" means, at any time, any Lender Party that, at such
time, (a) owes a Defaulted Advance or a Defaulted Amount or (b) shall take any
action or be the subject of any action or proceeding of a type described in
Section 6.01(f). "DEGI GROUP" has the meaning specified in the Agreement and
Plan of Recapitalization. "DOLLARS" and the sign "U.S.$" each means lawful money
of the United States of America. "DOMESTIC LENDING OFFICE" means, with respect
to any Lender Party, the office of such Lender Party specified as its "Domestic
Lending Office" opposite its name on Schedule I hereto or in the Assignment and
Acceptance or other instrument pursuant to which it became a Lender Party, as
the case may be, or such other office of such Lender Party as such Lender Party
may from time to time specify to the U.S. Borrower and the Administrative Agent.
"DOMESTIC SUBSIDIARY" means any Subsidiary other than a Foreign Subsidiary.
"EBITDA" means, in each case of the U.S. Borrower and each of its Subsidiaries,
for any period, the sum (without duplication) of (a) Net Income, and (b) to the
extent Net Income has been reduced thereby, (i) all income taxes and foreign
withholding taxes paid or accrued for such period, (ii) Interest Expense, (iii)
Non-cash Charges less any non-cash items increasing Net Income for such period
(other than normal accruals in the ordinary course of business), (iv) any cash
charges resulting from the Transactions and the related financings that, in each
case, are incurred prior to the six month anniversary of the Initial Extension
of Credit, and (v) any non-capitalized transactions costs incurred in connection
with actual, proposed or abandoned financings, acquisitions or divestitures,
including, but not limited to, financing and refinancing fees and costs incurred
in connection with the Transactions, all as determined in accordance with GAAP
for such period, provided that, for purposes of the last quarter of Fiscal Year
2000 and the first quarter of Fiscal Year 2001, Consolidated EBITDA of the U.S.
Borrower and its Subsidiaries shall mean, respectively U.S.$58,300,000 and
U.S.$54,900,000. "EFFECTIVE DATE" means the first date on which the conditions
set forth in Article III are satisfied. "ELIGIBLE ASSIGNEE" means any commercial
bank or financial institution (including, without limitation, any fund that
regularly invests in loans similar to the Tranche A Euro Term Advances or
Tranche B Term Advances) as approved (which approval shall be required only so
long as no Event of Default has occurred and is continuing at the time of an
assignment) by the U.S. Borrower (such approval not to be unreasonably withheld
or delayed); provided, however, that neither any Loan Party nor any Subsidiary
of a Loan Party shall qualify as an Eligible Assignee under this definition. 19
14 "ENVIRONMENTAL ACTION" means any action, suit, demand, demand letter, claim,
notice of non-compliance or violation, notice of liability or potential
liability, investigation, proceeding, consent order or consent agreement
relating in any way to any Environmental Law, any Environmental Permit or
Hazardous Material or arising from alleged injury or threat to health, safety or
the environment, including, without limitation, (a) by any governmental or
regulatory authority for enforcement, cleanup, removal, response, remedial or
other actions or damages and (b) by any governmental or regulatory authority or
third party for damages, contribution, indemnification, cost recovery,
Page 11
compensation or injunctive relief. "ENVIRONMENTAL LAW" means any applicable
Federal, state, local or foreign statute, law, ordinance, rule, regulation,
code, order, writ, judgment, injunction or decree, or any judicial or agency
interpretation, policy or guidance having the force or effect of law, relating
to pollution or protection of the environment, health, safety or natural
resources, including, without limitation, those relating to the use, handling,
transportation, treatment, storage, disposal, release or discharge of Hazardous
Materials. "ENVIRONMENTAL PERMIT" means any permit, approval, identification
number, license or other authorization required under any Environmental Law.
"EQUIPMENT" means all Equipment referred to in Section 1(a) of the Security
Agreement. "EQUITY CONTRIBUTION" has the meaning specified in Section 3.01(h).
"EQUITY INTERESTS" means, with respect to any Person, shares of capital stock of
(or other ownership interests in) such Person, warrants, options or other rights
for the purchase or other acquisition from such Person of shares of capital
stock of (or other ownership interests in) such Person, securities convertible
into or exchangeable for shares of capital stock of (or other ownership
interests in) such Person or warrants, rights or options for the purchase or
other acquisition from such Person of such shares (or such other interests), and
other ownership interests in such Person (including, without limitation,
partnership, member or trust interests therein), whether voting or nonvoting,
and whether or not such shares, warrants, options, rights or other interests are
authorized or otherwise existing on any date of determination. "EQUIVALENT" in
Dollars of any Euros on any date means the equivalent in Dollars of such Euros
determined by using the quoted spot rate at which the Administrative Agent's
principal office in New York City offers to exchange Dollars for Euros in New
York City prior to 4:00 P.M. (New York City time) (unless otherwise indicated by
the terms of this Agreement) on such date, and the "EQUIVALENT" in Euros of any
Dollars means the equivalent in Euros of such Dollars determined by using the
quoted spot rate at which the Administrative Agent's principal office in New
York City offers to exchange 20 15 Euros for Dollars in New York City prior to
4:00 P.M. (New York City time) (unless otherwise indicated by the terms of this
Agreement) on such date. "ERISA" means the Employee Retirement Income Security
Act of 1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder. "ERISA AFFILIATE" means any Person that for purposes
of Title IV of ERISA is a member of the controlled group of any Loan Party, or
under common control with any Loan Party, within the meaning of Section 414 (b)
or (c) of the Internal Revenue Code, and solely for purposes of Section 412 of
the Internal Revenue Code, within the meaning of Section 414(m) or (o) of the
Internal Revenue Code. "ERISA EVENT" means (a) (i) the occurrence of a
reportable event, within the meaning of Section 4043 of ERISA, with respect to
any Plan unless the 30-day notice requirement with respect to such event has
been waived by the PBGC or (ii) the requirements of Section 4043(b) of ERISA
apply with respect to a contributing sponsor, as defined in Section 4001(a)(13)
of ERISA, of a Plan, and an event described in paragraph (9), (10), (11), (12)
or (13) of Section 4043(c) of ERISA is reasonably expected to occur with respect
to such Plan within the following 30 days; (b) the application for a minimum
funding waiver with respect to a Plan; (c) the provision by the administrator of
any Plan of a notice of intent to terminate such Plan, pursuant to Section
4041(a)(2) of ERISA (including any such notice with respect to a plan amendment
referred to in Section 4041(e) of ERISA); (d) the cessation of operations at a
facility of any Loan Party or any ERISA Affiliate in the circumstances described
in Section 4062(e) of ERISA; (e) the withdrawal by any Loan Party or any ERISA
Affiliate from a Multiple Employer Plan during a plan year for which it was a
substantial employer, as defined in Section 4001(a)(2) of ERISA; (f) the
conditions for imposition of a lien under Section 302(f) of ERISA shall have
been met with respect to any Plan; (g) the adoption of an amendment to a Plan
requiring the provision of security to such Plan pursuant to Section 307 of
ERISA; or (h) the institution by the PBGC of proceedings to terminate a Plan
pursuant to Section 4042 of ERISA, or the occurrence of any event or condition
described in Section 4042 of ERISA that constitutes grounds for the termination
of, or the appointment of a trustee to administer, such Plan. "EURO" and the
sign "E." each means the single currency of the Participating Member States of
the European Union. "EURO BORROWER" has the meaning specified in the recital of
Page 12
parties to this Agreement. "EURO LENDING OFFICE" means, with respect to any
Lender Party, the office of such Lender Party specified as its "Euro Lending
Office" opposite its name on Schedule I hereto or in the Assignment and
Acceptance pursuant to which it becomes a Lender 21 16 Party, as the case may
be, or such other office of such Lender Party as such Lender Party may from time
to time specify to the Euro Borrower and the Administrative Agent. "EURO RATE"
means, for any Interest Period for all Euro Rate Advances comprising part of the
same Borrowing, (i) an interest rate per annum equal to the rate per annum
appearing on Reuters Page EURIBOR-01 (or any successor page) at 11:00 A.M.
(Brussels time) two Business Days before the first day of such Interest Period
for a period equal to such Interest Period, or (ii) if such rate per annum is
not shown on Reuters Page EURIBOR-01 (or on such other page or service specified
by the Administrative Agent after consultation with the Euro Borrower for the
purpose of displaying the Banking Federation of the European Union rates for
deposits in Euros), the average offered quotation by four prime banks in the
Euro-zone interbank market to the Administrative Agent for Euro-deposits of
amounts comparable to the principal amount of the Borrowing consisting of Euro
Rate Advances with maturities comparable to the applicable Interest Period
therefor, determined at 11:00 A.M. (Brussels time) two Business Days before the
first day of such Interest Period, provided that, in the event (x) the Tranche A
Euro Term Lenders shall have notified the Administrative Agent in accordance
with Section 2.10(c)(ii) or (y) the circumstances described in Section
2.10(d)(ii) in respect of Euro Rate Advances shall have occurred, the Euro Rate
determined pursuant to this definition shall instead be the rate per annum
determined by the Administrative Agent from time to time as the all-in-cost of
funds for the Administrative Agent to fund Euro Rate Advances with maturities
comparable to the Interest Period applicable thereto. "EURO RATE ADVANCE" means
an Advance that bears interest as provided in Section 2.07(a)(iii).
"EUROCURRENCY LIABILITIES" has the meaning specified in Regulation D of the
Board of Governors of the Federal Reserve System, as in effect from time to
time. "EURODOLLAR LENDING OFFICE" means, with respect to any Lender Party, the
office of such Lender Party specified as its "Eurodollar Lending Office"
opposite its name on Schedule I hereto or in the Assignment and Acceptance
pursuant to which it became a Lender Party (or, if no such office is specified,
its Domestic Lending Office), or such other office of such Lender Party as such
Lender Party may from time to time specify to the U.S. Borrower and the
Administrative Agent. "EURODOLLAR RATE" means, for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing, an interest rate
per annum equal to the rate per annum obtained by dividing (a) the rate per
annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on
Telerate Page 3750 (or any successor page) as the London interbank offered rate
for deposits in U.S. dollars at 11:00 A.M. (London time) two Business Days
before the first day of such Interest Period for a period equal to such Interest
Period (provided that, if for any reason such rate is not available, 22 17 the
term "Eurodollar Rate" shall mean, for any Interest Period for all Eurodollar
Rate Advances comprising part of the same Borrowing, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen
LIBOR Page as the London interbank offered rate for deposits in Dollars at
approximately 11:00 A.M. (London time) two Business Days prior to the first day
of such Interest Period for a term comparable to such Interest Period; provided,
however, if more than one rate is specified on Reuters Screen LIBO Page, the
applicable rate shall be the arithmetic mean of all such rates) by (b) a
percentage equal to 100% minus the Eurodollar Rate Reserve Percentage for such
Interest Period. "EURODOLLAR RATE ADVANCE" means an Advance that bears interest
as provided in Section 2.07(a)(ii). "EURODOLLAR RATE RESERVE PERCENTAGE" for any
Interest Period for all Eurodollar Rate Advances comprising part of the same
Borrowing means the reserve percentage applicable two Business Days before the
first day of such Interest Period under regulations issued from time to time by
the Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including, without limitation, any
emergency, supplemental or other marginal reserve requirement) for a member bank
of the Federal Reserve System in New York City with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities (or with respect to
Page 13
any other category of liabilities related to the basis on which the interest
rate on Eurodollar Rate Advances is determined) having a term equal to such
Interest Period. "EURO-ZONE" means the region composed of the Participating
Member States. "EVENTS OF DEFAULT" has the meaning specified in Section 6.01.
"EXCESS CASH FLOW" means, for any period, the lesser of (X) (a) the sum of: (i)
Consolidated Net Income of the U.S. Borrower and its Subsidiaries for such
period (without taking into account any income or gain from sales, transfers or
other dispositions of assets) plus (ii) the aggregate amount of all Non-cash
Charges deducted in arriving at such Consolidated Net Income plus (iii) if there
was a net increase in Consolidated Current Liabilities of the U.S. Borrower and
its Subsidiaries during such period, the amount of such net increase plus 23 18
(iv) if there was a net decrease in Consolidated Current Assets (excluding cash
and Cash Equivalents) of the U.S Borrower and its Subsidiaries during such
period, the amount of such net decrease plus (v) any Rollover Amount permitted
to be used for Capital Expenditures during such period, to the extent not used
during such period less (b) the sum of: (i) the aggregate amount of all non-cash
credits included in arriving at such Consolidated Net Income plus (ii) if there
was a net decrease in Consolidated Current Liabilities of the U.S. Borrower and
its Subsidiaries during such period, the amount of such net decrease plus (iii)
if there was a net increase in Consolidated Current Assets (excluding cash and
Cash Equivalents) of the U.S. Borrower and its Subsidiaries during such period,
the amount of such net increase plus (iv) the aggregate amount of Capital
Expenditures of the U.S. Borrower and its Subsidiaries permitted to be made in
accordance with the terms hereof and paid in cash (other than the Net Cash
Proceeds from the sale, transfer or other dispositions of assets) during such
period plus (v) the aggregate amount of all regularly scheduled principal
payments of Debt for Borrowed Money made during such period plus (vi) the
aggregate amount of all optional prepayments of Advances under the Tranche A
Euro Term Facility, Tranche A U.S. Term Facility and the Tranche B Term Facility
plus (vii) (without duplication) the aggregate amount of Investments made in
cash during such period (other than with the proceeds of Debt) and otherwise
permitted under this Agreement plus (viii) the Rollover Amount for such period,
and (Y) the excess, as of the last day of such period, of the aggregate
principal amount of cash and Cash Equivalents of the U.S. Borrower and its
Subsidiaries over U.S.$35,000,000. "EXCLUDED TAXES" has the meaning specified in
Section 2.12(a). 24 19 "EXCLUDED VOTING INTERESTS" means (i) the Voting
Interests held by Dresser Industries, Inc. on the Effective Date in the U.S.
Borrower, (ii) any Voting Interests of the U.S. Borrower issued to or any Voting
Interests of the U.S. Borrower underlying any warrants, rights or options
granted to or for the benefit of management of the U.S. Borrower or any of its
Subsidiaries, (iii) the Voting Interests of the U.S. Borrower (up to 10% in the
aggregate of the Voting Interests of the U.S. Borrower on a fully-diluted basis)
issued as full or partial consideration in connection with Permitted
Acquisitions, and (iv) the Voting Interests of the U.S. Borrower issued as full
or partial consideration in connection with the Pending Acquisition. "EXISTING
DEBT" means Debt of each Loan Party and its Subsidiaries outstanding immediately
before giving effect to the consummation of the Transaction. "EXTRAORDINARY
RECEIPT" means any cash received by or paid to or for the account of any Person
that under GAAP is required to be reported as an extraordinary item, excluding
any sale, lease, transfer or other disposition of assets but including, without
limitation, any such extraordinary items resulting from (i) pension plan
reversions, (ii) proceeds of property insurance in excess of, in the aggregate,
U.S.$1,000,000, (iii) condemnation awards in excess of, in the aggregate,
U.S.$1,000,000 (and payments in lieu thereof), and (iv) indemnity payments
received pursuant to Article XII of the Agreement and Plan of Recapitalization
in an amount in excess of, in the aggregate, U.S.$1,000,000; provided, however,
that an Extraordinary Receipt shall not include cash receipts received from
proceeds of insurance, condemnation awards (or payments in lieu thereof) or
indemnity payments to the extent that such proceeds, awards or payments (A) in
respect of loss or damage to equipment, fixed assets or real property are
applied (or in respect of which expenditures were previously incurred) to
replace or repair the equipment, fixed assets or real property in respect of
which such proceeds were received, so long as such application is made within 12
Page 14
months after the occurrence of such damage or loss or (B) are received by any
Person in respect of any third party claim against such Person and applied to
pay (or to reimburse such Person for its prior payment of) such claim and the
costs and expenses of such Person with respect thereto. "FACILITY" means the
Tranche A U.S. Term Facility, the Tranche A Euro Term Facility, the Tranche B
Term Facility, the Revolving Credit Facility, the Swing Line Facility or the
Letter of Credit Facility. "FEDERAL FUNDS RATE" means, for any period, a
fluctuating interest rate per annum equal for each day during such period to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average of the
quotations for such day for such transactions received by the 25 20
Administrative Agent from three Federal funds brokers of recognized standing
selected by it. "FEE LETTER" means the fee letter dated January 30, 2001 and
entered into by and between the U.S. Borrower and the Administrative Agent, as
amended. "FISCAL YEAR" means a fiscal year of the Parent and its Consolidated
Subsidiaries ending on December 31 in any calendar year. "FOREIGN SUBSIDIARY"
means a Subsidiary organized under the laws of a jurisdiction other than the
United States or any state thereof or the District of Columbia. "FUNDED DEBT" of
any Person, means Debt in respect of the Advances, in the case of each of the
Borrowers, and all other Debt of such Person that by its terms matures more than
one year after the date of determination or matures within one year from such
date but is renewable or extendible, at the option of such Person, to a date
more than one year after such date or arises under a revolving credit or similar
agreement that obligates the lender or lenders to extend credit during a period
of more than one year after such date, including, without limitation, all
amounts of Funded Debt of such Person required to be paid or prepaid within one
year after the date of determination. "GAAP" has the meaning specified in
Section 1.03. "GUARANTIES" means the Parent Guaranty and the Subsidiary
Guaranty. "GUARANTORS" means the Parent and the Subsidiary Guarantors.
"HAZARDOUS MATERIALS" means (a) petroleum or petroleum products, by-products or
breakdown products, radioactive materials, asbestos-containing materials,
polychlorinated biphenyls and radon gas and (b) any other chemicals, materials
or substances designated, classified or regulated as hazardous or toxic or as a
pollutant or contaminant under any Environmental Law. "HEDGE AGREEMENTS" means
interest rate swap, cap or collar agreements, interest rate future or option
contracts, currency swap agreements, currency future or option contracts and
other hedging agreements. "HEDGE BANK" means any Lender Party or an Affiliate of
a Lender Party in its capacity as a party to a Secured Hedge Agreement.
"INCREASE DATES" has the meaning specified in Section 2.17. "INCREASING LENDER"
has the meaning specified in Section 2.17. "INDEMNIFIED PARTY" has the meaning
specified in Section 9.04(b). 26 21 "INDENTURE" means the indenture dated as of
the date hereof, and entered into by and among, the U.S. Borrower, the
Subsidiary Guarantors and State Street Bank and Trust Company, as trustee, as
such indenture may be amended, supplemented or otherwise modified from time to
time in accordance with its terms to the extent permitted by Section 5.02(p).
"INFORMATION MEMORANDUM" means the information memorandum dated March 2001 used
by the Joint Lead Arrangers in connection with the syndication of the
Commitments. "INITIAL EXTENSION OF CREDIT" means the earlier to occur of the
initial Borrowing and the initial issuance of a Letter of Credit hereunder.
"INITIAL ISSUING BANK" and "INITIAL LENDERS" each has the meaning specified in
the recital of parties to this Agreement. "INSUFFICIENCY" means, with respect to
any Plan, the amount, if any, of its unfunded benefit liabilities, as defined in
Section 4001(a)(18) of ERISA. "INTEREST COVERAGE RATIO" means, for any period,
the ratio of (a) Consolidated EBITDA of the U.S. Borrower and its Subsidiaries
to (b) the sum of (i) Consolidated Interest Expense of the U.S. Borrower and its
Subsidiaries and (ii) without duplication, for the U.S. Borrower and its
Subsidiaries, determined on a Consolidated basis, the aggregate amount of
dividends paid or payable with respect to Preferred Interests that are not
Qualified Preferred Stock, during such period. "INTEREST EXPENSE" means, in each
case of the U.S. Borrower and each of its Subsidiaries, for any period, the sum
Page 15
(without duplication) of: (i) the aggregate of all cash and non-cash interest
expense with respect to all outstanding Debt, including the net costs associated
with interest rate Hedge Agreements, but excluding the amortization or write-off
of debt issuance costs, (ii) the interest expense that was capitalized during
such period, and (iii) the interest component of Capitalized Leases paid,
accrued and/or scheduled to be paid or accrued, all as determined in accordance
with GAAP for such period, provided that, for purposes of the last quarter of
Fiscal Year 2000 and the first quarter of Fiscal Year 2001, Consolidated
Interest Expense of the U.S. Borrower and its Subsidiaries shall mean, for each
of such fiscal quarters, U.S.$22,000,000. "INTEREST PERIOD" means (A) for each
Eurodollar Rate Advance comprising part of the same Borrowing, the period
commencing on the date of such Eurodollar Rate Advance or the date of the
Conversion of any Base Rate Advance into such Eurodollar Rate Advance, and
ending on the last day of the period selected by the U.S. Borrower pursuant to
the provisions below and, thereafter, each subsequent period commencing on the
last day of the immediately preceding Interest Period and ending on the last day
of the period selected by the U.S. Borrower pursuant to the provisions below,
and (B) for each 27 22 Euro Rate Advance comprising part of the same Borrowing,
the period commencing on the date of such Euro Rate Advance and ending on the
last day of the period selected by the Euro Borrower pursuant to the provisions
below and, thereafter, each subsequent period commencing on the last day of the
immediately preceding Interest Period and ending on the last day of the period
selected by the Euro Borrower pursuant to the provisions below. The duration of
each Interest Period with respect to any Euro Rate or Eurodollar Rate Advances
shall be one, two, three or six months, or, to the extent made available by all
the Appropriate Lenders, twelve months, as the Applicable Borrower may, upon
notice received by the Administrative Agent not later than 11:00 A.M. (New York
City time) on the third Business Day prior to the first day of such Interest
Period, select; provided, however, that: (a) the U.S. Borrower may not select
any Interest Period with respect to any Eurodollar Rate Advance under a Facility
that ends after any principal repayment installment date for such Facility
unless, after giving effect to such selection, the aggregate principal amount of
Base Rate Advances and of Eurodollar Rate Advances having Interest Periods that
end on or prior to such principal repayment installment date for such Facility
shall be at least equal to the aggregate principal amount of Advances under such
Facility due and payable on or prior to such date; (b) the Euro Borrower may not
select any Interest Period with respect to any Euro Rate Advance under a
Facility that ends after any principal repayment installment date for such
Facility unless, after giving effect to such selection, the aggregate principal
amount of Euro Rate Advances having Interest Periods that end on or prior to
such principal repayment installment date for such Facility shall be at least
equal to the aggregate principal amount of Advances under such Facility due and
payable on or prior to such date; (c) Interest Periods commencing on the same
date for Euro Rate Advances or Eurodollar Rate Advances comprising part of the
same Borrowing shall be of the same duration; (d) whenever the last day of any
Interest Period would otherwise occur on a day other than a Business Day, the
last day of such Interest Period shall be extended to occur on the next
succeeding Business Day, provided, however, that, if such extension would cause
the last day of such Interest Period to occur in the next following calendar
month, the last day of such Interest Period shall occur on the next preceding
Business Day; (e) whenever the first day of any Interest Period occurs on a day
of an initial calendar month for which there is no numerically corresponding day
in the calendar month that succeeds such initial calendar month by the number of
months equal to the number of 28 23 months in such Interest Period, such
Interest Period shall end on the last Business Day of such succeeding calendar
month; and (f) notwithstanding anything provided herein, the Applicable Borrower
shall only be entitled to select an Interest Period of seven days with regard to
any Euro Rate or Eurodollar Rate Advances to be made as of the Initial Extension
of Credit. "INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder. "INVENTORY" means all Inventory referred to in Section 1(b) of the
Security Agreement. "INVESTMENT" in any Person means any loan or advance to such
Person, any purchase or other acquisition of any Equity Interests or Debt or the
Page 16
assets comprising a division or business unit or a substantial part or all of
the business of such Person, any capital contribution to such Person or any
other direct or indirect investment in such Person, including, without
limitation, any acquisition by way of a merger or consolidation and any
arrangement pursuant to which the investor incurs Debt of the types referred to
in clause (i) or (j) of the definition of "Debt" in respect of such Person.
"ISSUING BANK" means the Initial Issuing Bank and any Eligible Assignee to which
a Letter of Credit Commitment hereunder has been assigned pursuant to Section
9.07 so long as such Eligible Assignee expressly agrees to perform in accordance
with their terms all of the obligations that by the terms of this Agreement are
required to be performed by it as an Issuing Bank and notifies the
Administrative Agent of its Applicable Lending Office and the amount of its
Letter of Credit Commitment (which information shall be recorded by the
Administrative Agent in the Register), for so long as such Initial Issuing Bank
or Eligible Assignee, as the case may be, shall have a Letter of Credit
Commitment. "IPO" means a bona fide underwritten initial public offering of
Voting Interests of the U.S. Borrower, with aggregate gross proceeds of at least
U.S.$100,000,000. "JOINT LEAD ARRANGERS" means each of MSSF and CSFB. "L/C CASH
COLLATERAL ACCOUNT" has the meaning specified in the Security Agreement. "L/C
RELATED DOCUMENTS" has the meaning specified in Section 2.04(f)(ii). "LENDER
PARTY" means any Lender, the Swing Line Bank or the Issuing Bank. 29 24
"LENDERS" means the Initial Lenders and each Person that shall become a Lender
hereunder pursuant to Section 9.07 or pursuant to Section 2.17 or pursuant to
any amendment to this Agreement, for so long as such Initial Lender or Person,
as the case may be, shall be a party to this Agreement. "LETTER OF CREDIT
ADVANCE" means an advance made by the Issuing Bank or any Revolving Credit
Lender pursuant to Section 2.03(c). "LETTER OF CREDIT AGREEMENT" has the meaning
specified in Section 2.03(a). "LETTER OF CREDIT COMMITMENT" means, with respect
to the Issuing Bank at any time, the amount set forth opposite the Issuing
Bank's name on Schedule I hereto under the caption "Letter of Credit Commitment"
or, if the Issuing Bank has entered into one or more Assignment and Acceptances,
set forth for the Issuing Bank in the Register maintained by the Administrative
Agent pursuant to Section 9.07(d) as the Issuing Bank's "Letter of Credit
Commitment", as such amount may be reduced at or prior to such time pursuant to
Section 2.05. "LETTER OF CREDIT FACILITY" means, at any time, an amount equal to
the lesser of (a) the amount of the Issuing Bank's Letter of Credit Commitment
at such time and (b) U.S.$50,000,000, as such amount may be reduced at or prior
to such time pursuant to Section 2.05. "LETTERS OF CREDIT" has the meaning
specified in Section 2.01(f). "LIEN" means any lien, security interest or other
charge or encumbrance of any kind, or any other type of preferential
arrangement, including, without limitation, the lien or retained security title
of a conditional vendor and any easement, right of way or other encumbrance on
title to real property. "LOAN DOCUMENTS" means (a) for purposes of this
Agreement and the Notes and any amendment, supplement or modification hereof or
thereof, (i) this Agreement, (ii) the Notes, (iii) the Guaranties, (iv) the
Collateral Documents and (v) the Fee Letter, (vi) each Letter of Credit
Agreement and (b) for purposes of the Guaranties and the Collateral Documents
and for all other purposes other than for purposes of this Agreement and the
Notes, (i) this Agreement, (ii) the Notes, (iii) the Guaranties, (iv) the
Collateral Documents, (v) the Fee Letter, (vi) each Letter of Credit Agreement
and (vii) each Secured Hedge Agreement, in each case as amended. "LOAN PARTIES"
means each of the Borrowers and each of the Guarantors. "MARGIN STOCK" has the
meaning specified in Regulation U. 30 25 "MATERIAL ADVERSE CHANGE" means any
material adverse change in the business, condition (financial or otherwise),
operations, performance or properties of the Parent and its Subsidiaries, taken
as a whole. "MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the
business, condition (financial or otherwise), operations, performance or
properties of the Parent and its Subsidiaries, taken as a whole, (b) the rights
and remedies of any Agent or any Lender Party under any Transaction Document or
(c) the ability of any Loan Party to perform its material Obligations under any
Loan Document. "MATERIAL SUBSIDIARY" means, at any time, with respect to a Loan
Party, a Subsidiary of such Loan Party having assets in an amount equal to at
least 5% of the amount of total Consolidated assets of such Loan Party and its
Page 17
Subsidiaries (determined as of the last day of the most recent fiscal quarter of
such Loan Party) or revenues or net income in an amount equal to at least 5% of
the amount of total Consolidated revenues or net income of such Loan Party and
its Subsidiaries for the 12-month period ending on the last day of the most
recent fiscal quarter of such Loan Party; provided, however, that, (x) the
aggregate assets of all non-Material Subsidiaries of such Loan Party shall not,
at any time, exceed 10% of the amount of total Consolidated assets of such Loan
Party and its Subsidiaries (determined as of the last day of the most recent
fiscal quarter of such Loan Party) and (y) the aggregate revenues or net income
of all non-Material Subsidiaries of such Loan Party shall not exceed 10% of the
amount of total Consolidated revenues or net income of such Loan Party and its
Subsidiaries for the 12-month period ending on the last day of the most recent
fiscal quarter of such Loan Party. "MORTGAGE POLICIES" has the meaning specified
in Section 5.02(n). "MORTGAGES" has the meaning specified in Section 5.02(n).
"MSSF" has the meaning specified in the recital of parties hereto.
"MULTIEMPLOYER PLAN" means a multiemployer plan, as defined in Section
4001(a)(3) of ERISA, to which any Loan Party or any ERISA Affiliate is making or
accruing an obligation to make contributions, or has within any of the preceding
five plan years made or accrued an obligation to make contributions. "MULTIPLE
EMPLOYER PLAN" means a single employer plan, as defined in Section 4001(a)(15)
of ERISA, that (a) is maintained for employees of any Loan Party or any ERISA
Affiliate and at least one Person other than the Loan Parties and the ERISA
Affiliates or (b) was so maintained and in respect of which any Loan Party or
any ERISA Affiliate could reasonably be expected to have liability under Section
4064 or 4069 of ERISA in the event such plan has been or were to be terminated.
31 26 "NET CASH PROCEEDS" means, with respect to any sale, lease, transfer or
other disposition of any asset or the incurrence or issuance of any Debt or the
sale or issuance of any Equity Interests to any Person other than by the U.S.
Borrower to the Parent or by any Subsidiary of the U.S. Borrower to the U.S.
Borrower or another Subsidiary of the U.S. Borrower (including, without
limitation, receipt of any capital contribution) by any Person, or any
Extraordinary Receipt received by or paid to or for the account of any Person,
the aggregate amount of cash received from time to time (whether as initial
consideration or through payment or disposition of deferred consideration) by or
on behalf of such Person in connection with such transaction after deducting
therefrom only (without duplication) (a) reasonable and customary brokerage
commissions, underwriting fees and discounts, legal fees, finder's fees and
other similar fees and commissions, (b) the amount of taxes payable in
connection with or as a result of such transaction and (c) the amount of any
Debt secured by a Lien on such asset that, by the terms of the agreement or
instrument governing such Debt, is required to be repaid (and that is repaid)
upon such disposition, in each case to the extent, but only to the extent, that
the amounts so deducted are, at the time of receipt of such cash, actually paid
to a Person that is not an Affiliate of such Person or any Loan Party or any
Affiliate of any Loan Party and are properly attributable to such transaction or
to the asset that is the subject thereof; provided, however, that in the case of
taxes that are deductible under clause (b) above but for the fact that, at the
time of receipt of such cash, such taxes have not been actually paid or are not
then payable, such Loan Party or such Subsidiary may deduct an amount (the
"RESERVED AMOUNT") equal to the amount reserved in accordance with GAAP for such
Loan Party's or such Subsidiary's reasonable estimate of such taxes, other than
taxes for which such Loan Party or such Subsidiary is indemnified, provided
further, however, that, at the time such taxes are paid, an amount equal to the
amount, if any, by which the Reserved Amount for such taxes exceeds the amount
of such taxes actually paid shall constitute "Net Cash Proceeds" of the type for
which such taxes were reserved for all purposes hereunder; and provided further
still that Net Cash Proceeds from the sale, lease, transfer or other disposition
of any asset or from Extraordinary Receipts shall be determined (and, for the
purposes of Section 2.05(b), be deemed to have been received) as of the first
anniversary of the actual receipt thereof and shall not include any amount of
cash proceeds received in connection with such transaction to the extent such
cash proceeds are reinvested in the business of the U.S. Borrower or any of its
Subsidiaries, so long as application is made within 12 months after the actual
Page 18
receipt thereof. "NET INCOME" means, in each case of the U.S. Borrower and each
of its Subsidiaries, for any period, the aggregate net income (or loss) for such
period, determined in accordance with GAAP and without any deduction in respect
of distributions with respect to Preferred Interests; provided that there shall
be excluded from the definition of Net Income, in each case of the U.S. Borrower
and each of its Subsidiaries: (i) gains and losses from Asset Sales (without
regard to the U.S.$5,000,000 limitation set forth in the definition thereof) and
the related tax effects, (ii) gains and losses due solely to fluctuations in
currency values and the related tax effects, (iii) all 32 27 extraordinary,
unusual or nonrecurring charges, gains and losses (including, without
limitation, all restructuring costs and any expense or charge related to the
repurchase of Equity Interests or warrants or options to purchase Equity
Interests) and the related tax effects, (iv) the net income (or loss) of any
Person acquired in a pooling of interests transaction accrued prior to the date
it becomes a Subsidiary or is merged or consolidated with or into the U.S.
Borrower or any Subsidiary of the U.S. Borrower, (v) the net income (or loss) of
any Subsidiary to the extent that the declaration of dividends or similar
distributions by that Subsidiary of that income is prohibited by contract,
operation of law or otherwise, (vi) the net loss of any Person, other than a
Subsidiary of the U.S. Borrower, (vii) the net income of any Person, other than
a Subsidiary of the U.S. Borrower, except to the extent of cash dividends or
distributions paid to the U.S. Borrower or a Subsidiary of the U.S. Borrower by
such Person, (viii) in the case of a successor to the U.S. Borrower or any of
its Subsidiaries by consolidation or merger or as a transferee of the U.S.
Borrower's or such Subsidiary's assets, any earnings of the successor
corporation prior to such consolidation, merger or transfer of assets, and (ix)
any non-cash compensation charges, including any arising from existing stock
options resulting from any merger or recapitalization transaction, all as
determined in accordance with GAAP for such period. "NON-CASH CHARGES" means, in
each case of the U.S. Borrower and each of its Subsidiaries, for any period, the
aggregate depreciation, amortization and other non-cash charges and expenses
reducing Net Income of the U.S. Borrower or any of its Subsidiaries for such
period, all as determined on a consolidated basis in accordance with GAAP
(excluding any such charges that require an accrual of or a reserve for cash
payments for any future period other than accruals or reserves in the ordinary
course of business or associated with mandatory repurchases of Equity
Interests). Notwithstanding the foregoing, accruals in respect of payables in
the ordinary course of business shall be deemed not to constitute a "Non-cash
Charge." "NON-U.S. SECURITY DOCUMENTS" has the meaning specified in Section
3.01(a)(iv). "NOTE" means a Tranche A U.S. Term Note, a Tranche A Euro Term
Note, a Tranche B Term Note or a Revolving Credit Note. "NOTICE OF BORROWING"
has the meaning specified in Section 2.02(a). "NOTICE OF ISSUANCE" has the
meaning specified in Section 2.03(a). "NOTICE OF RENEWAL" has the meaning
specified in Section 2.01(f). "NOTICE OF TERMINATION" has the meaning specified
in Section 2.01(f). "NPL" means the National Priorities List under CERCLA. 33 28
"OBLIGATION" means, with respect to any Person, any payment, performance or
other obligation of such Person of any kind, including, without limitation, any
liability of such Person on any claim, whether or not the right of any creditor
to payment in respect of such claim is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, disputed, undisputed, legal,
equitable, secured or unsecured, and whether or not such claim is discharged,
stayed or otherwise affected by any proceeding referred to in Section 6.01(f).
Without limiting the generality of the foregoing, the Obligations of any Loan
Party under the Loan Documents shall include the obligation to pay principal,
interest, Letter of Credit commissions, charges, expenses, fees, attorneys' fees
and disbursements, indemnities and other amounts payable by such Loan Party
under any Loan Document. "OPEN YEAR" has the meaning specified in Section
4.01(8)(iii). "OTHER TAXES" has the meaning specified in Section 2.12(b).
"PARENT" has the meaning specified in the recital of parties to this Agreement.
"PARENT GUARANTY" means the guaranty of the Parent set forth in Article VIII.
"PARTICIPATING MEMBER STATES" means a member state of the European Communities
that adopts or has adopted the euro as its currency in accordance with
legislation of the European Union relating to the European Economic and Monetary
Page 19
Union. "PBGC" means the Pension Benefit Guaranty Corporation (or any successor).
"PENDING ACQUISITION" means the acquisition by the U.S. Borrower of all or
substantially all of the Equity Interests in, or assets of, Subsidiaries of
Affiliates of First Reserve Corporation, which Subsidiaries are primarily
engaged in the production of valve equipment, complementing the U.S. Borrower's
existing product line, which acquisition shall satisfy either of the following
conditions: (a) a majority of the disinterested members of the board of
directors of the U.S. Borrower shall determine in good faith that such
acquisition is on terms that are not materially less favorable than those that
might reasonably have been obtained in a comparable transaction at such time on
an arm's-length basis from a Person that is not an Affiliate of the U.S.
Borrower; or (b) the board of directors of the U.S. Borrower shall obtain an
opinion from a nationally recognized investment banking, appraisal or accounting
firm that such acquisition is on terms that are not materially less favorable
than those that might reasonably have been obtained in a comparable transaction
at such time on an arm's-length basis from a Person that is not an Affiliate of
the U.S. Borrower. 34 29 "PERMITTED ACQUISITION" means any purchase by the U.S.
Borrower or any of its Subsidiaries of all or substantially all of the Equity
Interests in, or assets of, or business conducted by, another Person or the
merger, consolidation or amalgamation of any Person with or into the U.S.
Borrower or any of its Subsidiaries if all of the following conditions are met:
(a) immediately before and after giving effect to such purchase, merger,
consolidation or amalgamation, no Default has occurred and is continuing or
would result therefrom; (b) the Person or business acquired in such acquisition
shall not be engaged in any material respect in any business other than a
Permitted Business; (c) immediately before and after giving effect to such
purchase, merger, consolidation or amalgamation, the U.S. Borrower shall be in
pro forma compliance with the covenants contained in Section 5.04, calculated
based on the financial statements most recently delivered to the Lender Parties
pursuant to Section 5.03 and as though such acquisition had occurred at the
beginning of the four-quarter period covered thereby, as evidenced by a
certificate of the Chief Financial Officer of the U.S. Borrower delivered to the
Lender Parties demonstrating such compliance; (d) all transactions related
thereto are consummated in compliance, in all material respects, with applicable
requirements of law; (e) all actions, if any, required to be taken hereunder
with respect to any acquired or newly formed Subsidiary and its property are
taken as and when required; and (f) the aggregate consideration for such
acquisition, when added to all such consideration for all such prior
acquisitions (not taking into account the Pending Acquisition), shall not exceed
the sum of (i) U.S.$95,000,000 and (ii) the lesser of (A) U.S.$50,000,000 and
(B) the aggregate amount of all payments on the Tranche A U.S. Term Advances,
the Tranche A Euro Term Advances and the Tranche B Term Advances previously made
from (x) Excess Cash Flow, (y) Net Cash Proceeds from any sale, lease transfer
or other disposition of any assets, or (z) optional prepayments. Notwithstanding
anything to the contrary contained in this definition of Permitted Acquisition,
an acquisition which does not otherwise meet the requirements set forth above
shall constitute a Permitted Acquisition if, and to the extent, the Required
Lenders agree in writing that such acquisition shall constitute a Permitted
Acquisition for purposes of this Agreement. 35 30 "PERMITTED BUSINESS" shall
mean each business conducted by the Parent, the U.S. Borrower and its
Subsidiaries on the Effective Date and any other business or activity that is
related thereto or a reasonable extension thereof. "PERMITTED ENCUMBRANCES" has
the meaning specified in clause (ii) or (ix) of the definition of "Permitted
Liens", and as to which no enforcement, collection, execution, levy or
foreclosure procedure shall have been commenced. "PERMITTED INVESTORS" shall
mean First Reserve Corporation, its Affiliates and any general or limited
partners of First Reserve Corporation on the Effective Date, Odyssey Investment
Partners Fund, LP, its Affiliates and any general or limited partners of Odyssey
Investment Partners Fund, LP on the Effective Date. "PERMITTED LIENS" means such
of the following as to which no enforcement, collection, execution, levy or
foreclosure proceeding shall have been commenced: (i) Liens for taxes,
assessments and governmental charges or levies that are not yet due and payable
or are being contested in good faith and by appropriate proceedings and as to
Page 20
which reserves shall be maintained in accordance with Section 5.01(b), (ii)
statutory or common law Liens of landlords and carriers, warehousemen,
mechanics, suppliers, materialmen, repairmen and other similar Liens, arising in
the ordinary course of business for sums which either (x) do not in the
aggregate materially detract from the value of such property or assets or
materially impair the use thereof in the operation of the business of the U.S.
Borrower or any of its Subsidiaries or (y) are not yet delinquent or are being
contested in good faith by appropriate proceedings, (iii) Liens incurred or
deposits made in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social security laws or
regulations, (iv) Liens incurred or deposits made to secure the performance of
tenders, bids, leases, statutory or regulatory obligations, surety and appeal
bonds, government contracts, performance and return-of-money bonds and other
obligations of a like-nature, in each case in the ordinary course of business,
and a bank's unexercised right of set-off with respect to deposits made in the
ordinary course, (v) licenses, leases or subleases granted to third Persons in
the ordinary course of business not interfering in any material respect with the
business of the U.S. Borrower or any of its Subsidiaries, taken as a whole, (vi)
any interest or title of a lessor or licensor in any property subject to any
lease or license in the ordinary course of such lessor's or licensor's business
and covering only the assets so leased or licensed, (vii) Liens arising out of
judgments, decrees or attachments (other than in circumstances constituting an
Event of Default) in respect of which, within 5 Business Days after the
enforcement of such Lien, the U.S. Borrower or any of its Subsidiaries shall in
good faith be prosecuting an appeal or proceedings for review and shall have
secured a subsisting stay of execution pending such appeal or proceedings for
review, (viii) Liens in favor of customs or revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods, (ix) easements, rights-of-way, restrictions and other
similar encumbrances 36 31 incurred in the ordinary course of business that, in
the aggregate, are not substantial in amount and that do not in any case
materially detract from the value of the property subject thereto or materially
interfere with the ordinary conduct of the business of the U.S. Borrower or any
Subsidiary, and (x) Liens upon specific items of inventory or other goods and
proceeds of any Person securing such Person's obligation in respect of bankers'
acceptances issued or created for the account of such Person to facilitate the
purchase, shipment or storage of such inventory or other goods. "PERMITTED
SUBORDINATED DEBT" shall mean either (a) Debt for Borrowed Money of the U.S.
Borrower or the Subsidiary Guarantors incurred to pay or finance purchase
consideration for a Permitted Acquisition or the Pending Acquisition or to
finance any repayment of outstanding Tranche A U.S. Term Advances, Tranche A
Euro Term Advances and Tranche B Term Advances, the governing documents of which
either (x) contain covenants, defaults, subsidiary guarantees and subordination
provisions at least as favorable (taken as a whole) to the Lender Parties as
those set forth in the Senior Subordinated Debt Documents and do not require any
principal payments prior to the tenth anniversary of the Effective Date (except
in the case of a Change of Control or any sale, lease, transfer or other
disposition of any assets on the terms set forth in the Senior Subordinated Debt
Documents) or (y) contain terms and conditions that are otherwise reasonably
satisfactory to the Required Lenders or (b) Preferred Interests of the U.S.
Borrower that are not Qualified Preferred Stock, provided, in each case, that
immediately after the incurrence or issuance of such Debt the U.S. Borrower
shall be in pro forma compliance with the covenants contained in Section 5.04,
calculated based on the financial statements most recently delivered to the
Lender Parties pursuant to Section 5.03, as evidenced by a certificate of the
Chief Financial Officer of the U.S. Borrower delivered to the Lender Parties
demonstrating such compliance. "PERMITTED SUBORDINATED REFINANCING DEBT" shall
mean Debt of the U.S. Borrower or the Subsidiary Guarantors issued or given in
exchange for, or all the proceeds of which are used to refinance, all or any
portion of any outstanding Senior Subordinated Debt or Permitted Subordinated
Debt, so long as (a) such Debt has weighted average life to maturity greater
than or equal to the weighted average life to maturity of the Senior
Subordinated Notes, (b) such refinancing does not (i) increase the amount of
Page 21
such Debt outstanding immediately prior to such refinancing or (ii) add
guarantors, obligors or security from that which applied to the Senior
Subordinated Notes, (c) such Debt has substantially the same (or, from the
perspective of the Lender Parties, more favorable) subordination provisions, if
any, as applied to the Senior Subordinated Notes, (d) all other terms of such
refinancing (including, without limitation, with respect to the redemption
provisions, maturities, covenants, defaults and remedies), are not, taken as a
whole, materially less favorable to the Lender Parties than those previously
existing with respect to the Senior Subordinated Notes, (e) the interest rate
applicable to any such refinancing does not exceed the then applicable market
interest rate, and (f) no Default or Event of Default shall be in existence of
the time of such 37 32 refinancing or immediately after giving effect thereto,
provided, in each case, that immediately after the incurrence or issuance of
such Debt the U.S. Borrower shall be in pro forma compliance with the covenants
contained in Section 5.04, calculated based on the financial statements most
recently delivered to the Lender Parties pursuant to Section 5.03, as evidenced
by a certificate of the Chief Financial Officer of the U.S. Borrower delivered
to the Lender Parties demonstrating such compliance. "PERSON" means an
individual, partnership, corporation (including a business trust), limited
liability company, joint stock company, trust, unincorporated association, joint
venture or other entity, or a government or any political subdivision or agency
thereof. "PLAN" means a Single Employer Plan or a Multiple Employer Plan.
"PLEDGED DEBT" has the meaning specified in the Security Agreement. "PLEDGED
SHARES" has the meaning specified in the Security Agreement. "PREFERRED
INTERESTS" means, with respect to any Person, Equity Interests issued by such
Person that are entitled to a preference or priority over any other Equity
Interests issued by such Person upon any distribution of such Person's property
and assets, whether by dividend or upon liquidation. "PRO FORMA ADJUSTED EBITDA"
for any period, means Consolidated EBITDA of the U.S. Borrower and its
Subsidiaries for such period adjusted to give effect on a pro forma basis for
such period to any sale, transfer, lease or other disposition of assets
permitted by the terms of this Agreement or a Permitted Acquisition or the
Pending Acquisition (including, without limitation, (A) any Permitted
Acquisition or the Pending Acquisition giving rise to the need to make such
adjustments as a result of the U.S. Borrower or one of its Subsidiaries
(including any Person who becomes a Subsidiary as a result of the Permitted
Acquisition or Pending Acquisition) incurring, assuming or otherwise being
liable for Debt that was outstanding immediately prior to the consummation of
such Permitted Acquisition or Pending Acquisition and was not incurred in
connection with, or in contemplation of, such Permitted Acquisition or Pending
Acquisition, and (B) any Consolidated EBITDA including any pro forma expense and
cost reductions and other operating improvements that have occurred or are
reasonably expected to occur in the reasonable judgment of the Chief Financial
Officer of the U.S. Borrower (regardless of whether those cost savings or
operating improvements could then be reflected in pro forma financial statements
in accordance with GAAP, Regulation S-X of the Securities Act of 1933 or any
other regulation or policy of the SEC related thereto) attributable to the
assets which are the subject of such sale, transfer, lease, other disposition or
acquisition and without regard to clause (iv) of the definition of Net Income)
occurring during the four fiscal quarter period ended on the last date of such
38 33 period, as if such sale, transfer, lease, other disposition or acquisition
occurred on the first date of such four fiscal quarter period. "PRO RATA SHARE"
of any amount means, with respect to any Revolving Credit Lender at any time,
the product of such amount times a fraction the numerator of which is the amount
of such Lender's Revolving Credit Commitment at such time (or, if the
Commitments shall have been terminated pursuant to Section 2.05 or Section 6.01,
such Lender's Revolving Credit Commitment as in effect immediately prior to such
termination) and the denominator of which is the Revolving Credit Facility at
such time (or, if the Commitments shall have been terminated pursuant to Section
2.05 or Section 6.01, the Revolving Credit Facility as in effect immediately
prior to such termination). "QUALIFIED PREFERRED STOCK" shall mean any Preferred
Interest of the U.S. Borrower in respect of which no dividends thereon (other
than dividends payable solely in kind) shall be required to be paid at any time
Page 22
or to the extent that such payment would be prohibited by the terms of this
Agreement, and that is not redeemable prior to the tenth anniversary of the
Effective Date under any circumstance, except (i) for Permitted Subordinated
Debt or (ii) upon a Change of Control, if payment of the redemption price upon a
Change of Control is required and only if permitted by the terms of this
Agreement. "RECAPITALIZATION" has the meaning specified in the Preliminary
Statements. "RECEIVABLES" means all Receivables referred to in Section 1(c) of
the Security Agreement. "REDEEMABLE" means, with respect to any Equity Interest,
any Debt or any other right or Obligation, any such Equity Interest, Debt, right
or Obligation that (a) the issuer has undertaken to redeem at a fixed or
determinable date or dates, whether by operation of a sinking fund or otherwise,
or upon the occurrence of a condition not solely within the control of the
issuer or (b) is redeemable at the option of the holder. "REDUCTION AMOUNT" has
the meaning specified in Section 2.06(b)(v). "REGISTER" has the meaning
specified in Section 9.07(d). "REGULATION U" means Regulation U of the Board of
Governors of the Federal Reserve System, as in effect from time to time.
"RELATED DOCUMENTS" means the Agreement and Plan of Recapitalization, the Senior
Subordinated Debt Documents, the Tax Agreement and the Sponsors Letter. 39 34
"RELATED PARTY" with respect to any Permitted Investor means, (a) (i) any
spouse, sibling, parent, or child of such Permitted Investor, or (ii) the estate
of any Permitted Investor during any period in which such estate holds capital
stock of the U.S. Borrower for the benefit of any Person referred to in clause
(a)(i) above, or (b) any trust, corporation, partnership, limited liability
company or other entity the beneficiaries, stockholders, partners, owners or
Persons beneficially owning an interest of more than 50% of which consist of, or
the sole managing member of which is, one or more Permitted Investors and/or
such other Persons referred to in the immediately preceding clause (a).
"REQUIRED LENDERS" means, at any time, Lenders owed or holding at least a
majority in interest of the aggregate principal amount (based, in the case of
the Tranche A Euro Term Facility, on the Equivalent in Dollars at such time) of
the sum of (a) the aggregate principal amount of the Advances outstanding at
such time, (b) the aggregate Available Amount of all Letters of Credit
outstanding at such time, (c) the aggregate unused Commitments under all
Facilities (other than the Revolving Credit Facility, the Swing Line Facility or
the Letter of Credit Facility) at such time and (d) the aggregate Unused
Revolving Credit Commitments at such time; provided, however, that, if any
Lender shall be either (i) a Defaulting Lender or (ii) an Affiliate of any Loan
Party at such time, there shall be excluded from the determination of Required
Lenders at such time (A) the aggregate principal amount (based, to the extent
applicable, on the Equivalent in Dollars at such time) of the Advances owing to
such Lender (in its capacity as a Lender) and outstanding at such time, (B) such
Lender's Pro Rata share of the aggregate Available Amount of all Letters of
Credit outstanding at such time, (C) the aggregate unused Commitments of such
Lender under all Facilities (other than the Revolving Credit Facility, the Swing
Line Facility or the Letter of Credit Facility) at such time and (D) the Unused
Revolving Credit Commitment of such Lender at such time. For purposes of this
definition, the aggregate principal amount of Swing Line Advances owing to the
Swing Line Bank and of Letter of Credit Advances owing to the Issuing Bank and
the Available Amount of each Letter of Credit shall be considered to be owed to
the Revolving Credit Lenders ratably in accordance with their respective
Revolving Credit Commitments. "RESPONSIBLE OFFICER" means any officer of any
Loan Party or any of its Subsidiaries. "REVOLVING CREDIT ADVANCE" has the
meaning specified in Section 2.01(d). "REVOLVING CREDIT BORROWING" means a
borrowing consisting of simultaneous Revolving Credit Advances of the same Type
made by the Revolving Credit Lenders. "REVOLVING CREDIT COMMITMENT" means, with
respect to any Revolving Credit Lender at any time, the amount set forth
opposite such Lender's name on Schedule I hereto under the caption "Revolving
Credit Commitment" or, if such Lender has entered 40 35 into one or more
Assignment and Acceptances, set forth for such Lender in the Register maintained
by the Administrative Agent pursuant to Section 9.07(d) as such Lender's
"Revolving Credit Commitment", as such amount may be reduced at or prior to such
time pursuant to Section 2.05. "REVOLVING CREDIT FACILITY" means, at any time,
the aggregate amount of the Revolving Credit Lenders' Revolving Credit
Page 23
Commitments at such time. "REVOLVING CREDIT LENDER" means any Lender that has a
Revolving Credit Commitment. "REVOLVING CREDIT NOTE" means a promissory note of
the U.S. Borrower payable to the order of any Revolving Credit Lender, in
substantially the form of Exhibit A-1 hereto, evidencing the aggregate
indebtedness of the U.S. Borrower to such Lender resulting from the Revolving
Credit Advances, Letter of Credit Advances and Swing Line Advances made by such
Lender, as amended. If requested by the Swing Line Bank, the commitment of the
Swing Line Bank to make Swing Line Advances shall be evidenced by a separate
promissory note. "ROLLOVER AMOUNT" has the meaning specified in Section 5.02(n).
"SECURED HEDGE AGREEMENT" means any Hedge Agreement required or permitted under
Article V that is entered into by and between any Loan Party and any Hedge Bank.
"SECURED OBLIGATIONS" has the meaning specified in Section 2 of the Security
Agreement. "SECURED PARTIES" means the Agents, the Lender Parties and the Hedge
Banks. "SECURITY AGREEMENT" has the meaning specified in Section 3.01(a)(ii).
"SENIOR SUBORDINATED DEBT" means any Debt issued pursuant to the Indenture and
any other Debt of any Loan Party that is subordinated to the Obligations of such
Loan Party under the Loan Documents on, and that otherwise contains, terms and
conditions satisfactory to the Required Lenders. "SENIOR SUBORDINATED DEBT
DOCUMENTS" means the Indenture and all other agreements, indentures and
instruments pursuant to which Senior Subordinated Debt is issued, in each case
as amended, to the extent permitted under Section 5.02(p). "SPONSORS LETTER"
means the letter dated as of April 10, 2001 from First Reserve Corporation and
Odyssey Investments Partners, LLC to the U.S. Borrower. 41 36 "SENIOR
SUBORDINATED NOTES" means the senior subordinated notes of the U.S. Borrower in
an aggregate principal amount of U.S.$300,000,000 issued pursuant to the
Indenture. "SINGLE EMPLOYER PLAN" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of any Loan
Party or any ERISA Affiliate and no Person other than the Loan Parties and the
ERISA Affiliates or (b) was so maintained and in respect of which any Loan Party
or any ERISA Affiliate could reasonably be expected to have liability under
Section 4069 of ERISA in the event such plan has been or were to be terminated.
"SOLVENT" and "SOLVENCY" mean, with respect to any Person on a particular date,
that on such date (a) 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, (b) 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, (c) such Person does not intend to, and does not believe that it will,
incur debts or liabilities beyond such Person's ability to pay such debts and
liabilities as they mature and (d) 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 an unreasonably small capital. The
amount of contingent liabilities at any time shall be computed as the amount
that, in the 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. "STANDBY LETTER OF CREDIT" means any Letter of Credit issued
under the Letter of Credit Facility, other than a Trade Letter of Credit.
"SUBSIDIARY" of any Person means any corporation, partnership, joint venture,
limited liability company, trust or estate of which (or in which) more than 50%
of (a) the issued and outstanding capital stock having ordinary voting power to
elect a majority of the Board of Directors of such corporation (irrespective of
whether at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency), (b) the interest in the capital or profits of such partnership,
joint venture or limited liability company or (c) the beneficial interest in
such trust or estate is at the time directly or indirectly owned or controlled
by such Person, by such Person and one or more of its other Subsidiaries or by
one or more of such Person's other Subsidiaries. "SUBSIDIARY GUARANTORS" means
the Subsidiaries of the U.S. Borrower listed on Schedule II hereto and each
other Subsidiary of the U.S. Borrower that shall be required to execute and
deliver a guaranty pursuant to Section 5.01(j). 42 37 "SUBSIDIARY GUARANTY"
means the guaranty of the Subsidiary Guarantors set forth in Article VIII.
"SUPERMAJORITY LENDERS" means, at any time, with respect a Facility, Lenders
Page 24
owed or holding at least two-thirds in interest of the aggregate principal
amount (based, in the case of the Tranche A Euro Term Facility, on the
Equivalent in Dollars at such time) of the sum of (a) the aggregate principal
amount of the Advances outstanding at such time under such Facility and (b) the
aggregate unused Commitments at such time under such Facility (which, for
purposes of the Revolving Credit Facility, shall be equal to the Unused
Revolving Credit Commitments at such time); provided, however, that if any
Lender shall be either (i) a Defaulting Lender or (ii) an Affiliate of any Loan
Party at such time, there shall be excluded from the determination of
Supermajority Lenders at such time (A) the aggregate principal amount (based, in
the case of the Tranche A Euro Term Facility, on the Equivalent in Dollars at
such time) of the Advances owing to such Lender (in its capacity as a Lender),
and outstanding at such time under such Facility, and (B) the aggregate unused
Commitments of such Lender at such time under such Facility (which, for purposes
of the Revolving Credit Facility, shall be equal to the Unused Revolving Credit
Commitments at such time). For purposes of this definition, the aggregate
principal amount of Swing Line Advances owing to the Swing Line Bank shall be
considered to be owed to the Revolving Credit Lenders ratably in accordance with
their respective Revolving Credit Commitments under the Revolving Credit
Facility. "SURVIVING DEBT" means Debt of each Loan Party and its Subsidiaries
outstanding immediately before and after giving effect to the Transaction.
"SWING LINE ADVANCE" means an advance made by (a) the Swing Line Bank pursuant
to Section 2.01(e) or (b) any Revolving Credit Lender pursuant to Section
2.02(c). "SWING LINE BANK" means Xxxxx Fargo Bank Texas, N.A. and each Person
that shall become the Swing Line Bank hereunder pursuant to Section 9.07. "SWING
LINE BORROWING" means a borrowing consisting of a Swing Line Advance made by the
Swing Line Bank pursuant to Section 2.01(e) or the Revolving Credit Lenders
pursuant to Section 2.02(c). "SWING LINE FACILITY" has the meaning specified in
Section 2.01(e). "SWING LINE RESERVE" has the meaning specified in Section
2.02(b). "SYNDICATION AGENT" has the meaning specified in the recital of parties
to this Agreement. 43 38 "TAX AGREEMENT" means that certain tax sharing
agreement entered into by and between the U.S. Borrower and the Parent, as
amended, supplemented or otherwise modified from time to time, to the extent
permitted under Section 5.02(p). "TAX CERTIFICATE" has the meaning specified in
Section 5.03(k). "TAXES" has the meaning specified in Section 2.12(a).
"TERMINATION DATE" means the earlier of (a) the date of termination in whole of
the Revolving Credit Commitments, the Letter of Credit Commitment, the Tranche A
U.S. Term Commitments, the Tranche A Euro Term Commitments and the Tranche B
Term Commitments pursuant to Section 2.05 or Section 6.01 and (b) (i) for
purposes of the Revolving Credit Facility, the Letter of Credit Facility, the
Tranche A U.S. Term Facility and the Tranche A Euro Term Facility, April 10,
2007, and (ii) for purposes of the Tranche B Term and for all other purposes,
April 10, 2009. "TOTAL DEBT/EBITDA RATIO" means, for any period, the ratio of
(A) the sum of (i) Consolidated Debt for Borrowed Money of the U.S. Borrower and
its Subsidiaries on the last day of such period, and (ii) without duplication,
for the U.S. Borrower and its Subsidiaries, determined on a Consolidated basis,
the aggregate amount of the liquidation preference with respect to any Preferred
Interests that are not Qualified Preferred Stock issued and outstanding on the
last day of such period to (B) Consolidated Pro Forma Adjusted EBITDA of the
U.S. Borrower and its Subsidiaries for the four fiscal quarter period ending on
the last day of such period, provided there shall be excluded, solely for the
purpose of the calculation of Consolidated Debt for Borrowed Money for this
definition, any cash or Cash Equivalents maintained by the U.S. Borrower or any
of its Subsidiaries for any date of determination during the Fiscal Year ended
December 31, 2001. "TRADE LETTER OF CREDIT" means any Letter of Credit that is
issued under the Letter of Credit Facility for the benefit of a supplier of
Inventory (in its capacity as such) to the U.S. Borrower or any of its
Subsidiaries to effect payment for such Inventory. "TRANCHE A EURO TERM ADVANCE"
has the meaning specified in Section 2.01(b). "TRANCHE A EURO TERM BORROWING"
means a borrowing consisting of simultaneous Tranche A Euro Term Advances made
by the Tranche A Euro Term Lenders. "TRANCHE A EURO TERM COMMITMENT" means, with
respect to any Tranche A Euro Term Lender at any time, the amount set forth
opposite such Lender's name on Schedule I hereto under the caption "Tranche A
Page 25
Euro Term Commitment" or, if such Lender has entered into one or more Assignment
and Acceptances, the amount set forth for such Lender in the Register maintained
by the Administrative Agent pursuant to 44 39 Section 9.07(d) as such Lender's
"Tranche A Euro Term Commitment", as such amount may be reduced at or prior to
such time pursuant to Section 2.05. "TRANCHE A EURO TERM FACILITY" means, at any
time, the aggregate amount of the Tranche A Euro Term Lenders' Tranche A Euro
Term Commitments at such time. "TRANCHE A EURO TERM LENDER" means any Lender
that has a Tranche A Euro Term Commitment. "TRANCHE A EURO TERM NOTE" means a
promissory note of the Euro Borrower payable to the order of any Tranche A Euro
Term Lender, in substantially the form of Exhibit A-3 hereto, evidencing the
indebtedness of the Euro Borrower to such Lender resulting from the Tranche A
Euro Term Advance made by such Lender, as amended. "TRANCHE A U.S. TERM ADVANCE"
has the meaning specified in Section 2.01(a). "TRANCHE A U.S. TERM BORROWING"
means a borrowing consisting of simultaneous Tranche A U.S. Term Advances of the
same Type made by the Tranche A U.S. Term Lenders. "TRANCHE A U.S. TERM
COMMITMENT" means, with respect to any Tranche A U.S. Term Lender at any time,
the amount set forth opposite such Lender's name on Schedule I hereto under the
caption "Tranche A U.S. Term Commitment" or, if such Lender has entered into one
or more Assignment and Acceptances, the amount set forth for such Lender in the
Register maintained by the Administrative Agent pursuant to Section 9.07(d) as
such Lender's "Tranche A U.S. Term Commitment", as such amount may be reduced at
or prior to such time pursuant to Section 2.05. "TRANCHE A U.S. TERM FACILITY"
means, at any time, the aggregate amount of the Tranche A U.S. Term Lenders'
Tranche A U.S. Term Commitments at such time. "TRANCHE A U.S. TERM LENDER" means
any Lender that has a Tranche A U.S. Term Commitment. "TRANCHE A U.S. TERM NOTE"
means a promissory note of the U.S. Borrower payable to the order of any Tranche
A U.S. Term Lender, in substantially the form of Exhibit A-2 hereto, evidencing
the indebtedness of the U.S. Borrower to such Lender resulting from the Tranche
A U.S. Term Advance made by such Lender, as amended. "TRANCHE B TERM ADVANCE"
has the meaning specified in Section 2.01(c). "TRANCHE B TERM BORROWING" means a
borrowing consisting of simultaneous Tranche B Term Advances of the same Type
made by the Tranche B Term Lenders. 45 40 "TRANCHE B TERM COMMITMENT" means,
with respect to any Tranche B Term Lender at any time, the amount set forth
opposite such Lender's name on Schedule I hereto under the caption "Tranche B
Term Commitment" or, if such Lender has entered into one or more Assignment and
Acceptances, the amount set forth for such Lender in the Register maintained by
the Administrative Agent pursuant to Section 9.07(d) as such Lender's "Tranche B
Term Commitment", as such amount may be reduced at or prior to such time
pursuant to Section 2.05. "TRANCHE B TERM FACILITY" means, at any time, the
aggregate amount of the Term Lenders' Tranche B Term Commitments at such time.
"TRANCHE B TERM LENDER" means any Lender that has a Tranche B Term Commitment.
"TRANCHE B TERM NOTE" means a promissory note of the U.S. Borrower payable to
the order of any Tranche B Term Lender, in substantially the form of Exhibit A-4
hereto, evidencing the indebtedness of the U.S. Borrower to such Lender
resulting from the Tranche B Term Advance made by such Lender, as amended.
"TRANSACTION" means the Recapitalization and the other transactions contemplated
by the Transaction Documents. "TRANSACTION DOCUMENTS" means, collectively, the
Loan Documents and the Related Documents. "TYPE" refers to the distinction among
Advances bearing interest based on the Base Rate, Advances bearing interest
based on the Eurodollar Rate and Advances bearing interest based on the Euro
Rate. "UNUSED REVOLVING CREDIT COMMITMENT" means, with respect to any Revolving
Credit Lender at any time, (a) such Lender's Revolving Credit Commitment at such
time minus (b) the sum of (i) the aggregate principal amount of all Revolving
Credit Advances made by such Lender and outstanding at such time plus (ii) such
Lender's Pro Rata Share of (A) the aggregate Available Amount of all Letter of
Credit outstanding at such time, (B) the aggregate principal amount of all
Letter of Credit Advances made by the Issuing Bank pursuant to Section 2.03(c)
and outstanding at such time and (C) the Swing Line Reserve at such time. "U.S.
BORROWER" has the meaning specified in the recital of parties to this Agreement.
"VOTING INTERESTS" means shares of capital stock issued by a corporation, or
equivalent Equity Interests in any other Person, the holders of which are
ordinarily, in the absence of contingencies, entitled to vote for the election
of directors (or persons 46 41 performing similar functions) of such Person,
Page 26
even if the right so to vote has been suspended by the happening of such a
contingency. "WELFARE PLAN" means a welfare plan, as defined in Section 3(1) of
ERISA, that is maintained for employees of any Loan Party or in respect of which
any Loan Party could have liability. "WITHDRAWAL LIABILITY" has the meaning
specified in Part I of Subtitle E of Title IV of ERISA. SECTION 1.02.
Computation of Time Periods; Other Definitional Provisions. In this Agreement
and the other Loan Documents in the computation of periods of time from a
specified date to a later specified date, the word "FROM" means "from and
including" and the words "TO" and "UNTIL" each mean "to but excluding".
References in the Loan Documents to any agreement or contract shall mean and be
a reference to such agreement or contract as amended, amended and restated,
supplemented or otherwise modified from time to time in accordance with its
terms and in compliance with the Loan Documents. SECTION 1.03. Accounting Terms.
All accounting terms not specifically defined herein shall be construed in
accordance with generally accepted accounting principles consistent with those
applied in the preparation of the financial statements referred to in Section
4.01(g) ("GAAP"). ARTICLE II AMOUNTS AND TERMS OF THE ADVANCES AND THE LETTERS
OF CREDIT SECTION 2.01. The Advances and the Letter of Credit. (a) The Tranche A
U.S. Term Advances. Each Tranche A U.S. Term Lender severally agrees, on the
terms and conditions hereinafter set forth, to make a single advance (a "TRANCHE
A U.S. TERM ADVANCE") to the U.S. Borrower on the Effective Date in Dollars and
in an amount equal to such Lender's Tranche A U.S. Term Commitment at such time.
The Tranche A U.S. Term Borrowing shall consist of Tranche A U.S. Term Advances
made simultaneously by the Tranche A U.S. Term Lenders ratably according to
their Tranche A U.S. Term Commitments. Amounts borrowed under this Section
2.01(a) and repaid or prepaid may not be reborrowed. (b) The Tranche A Euro Term
Advances. Each Tranche A Euro Term Lender severally agrees, on the terms and
conditions hereinafter set forth, to make a single advance (a "TRANCHE A EURO
TERM ADVANCE") to the Euro Borrower on the Effective Date in Euros in an amount
equal to the Equivalent in Euros, on the Effective Date, of such Lender's
Tranche A Euro Term Commitment at such time. The Tranche A Euro Term Borrowing
shall consist of Tranche A Euro Term Advances made simultaneously by the Tranche
A Euro Term Lenders 47 42 ratably according to their Tranche A Euro Term
Commitments. Amounts borrowed under this Section 2.01(b) and repaid or prepaid
may not be reborrowed. (c) The Tranche B Term Advances. Each Tranche B Term
Lender severally agrees, on the terms and conditions hereinafter set forth, to
make a single advance (a "TRANCHE B TERM ADVANCE") to the U.S. Borrower on the
Effective Date in Dollars in an amount equal to such Lender's Tranche B Term
Commitment at such time. The Tranche B Term Borrowing shall consist of Tranche B
Term Advances made simultaneously by the Tranche B Term Lenders ratably
according to their Tranche B Term Commitments. Amounts borrowed under this
Section 2.01(c) and repaid or prepaid may not be reborrowed. (d) The Revolving
Credit Advances. Each Revolving Credit Lender severally agrees, on the terms and
conditions hereinafter set forth, to make advances (each, a "REVOLVING CREDIT
ADVANCE") to the U.S. Borrower from time to time on any Business Day during the
period from the date hereof until the Termination Date in Dollars in an amount
for each such Advance specified by the U.S. Borrower not to exceed, after giving
effect to any use of proceeds thereof to repay any Swing Line Advances or Letter
of Credit Advances such Lender's Unused Revolving Credit Commitment at such
time. Each Revolving Credit Borrowing shall be in an aggregate amount of
U.S.$5,000,000 or an integral multiple of U.S.$1,000,000 in excess thereof and
shall consist of Revolving Credit Advances made simultaneously by the Revolving
Credit Lenders ratably according to their Revolving Credit Commitments,
provided, however, that the Revolving Credit Borrowing made on the Effective
Date shall not exceed U.S.$3,000,000. Within the limits of each Revolving Credit
Lender's Unused Revolving Credit Commitment in effect from time to time, the
U.S. Borrower may borrow under this Section 2.01(d), prepay pursuant to Section
2.06(a) and reborrow under this Section 2.01(d). (e) The Swing Line Advances.
The U.S. Borrower may request the Swing Line Bank to make, and the Swing Line
Bank shall make, on the terms and conditions hereinafter set forth, Swing Line
Advances to the U.S. Borrower from time to time on any Business Day during the
period from the date hereof until the Termination Date in respect of the
Revolving Credit Facility (i) in Dollars in an aggregate amount not to exceed at
Page 27
any time outstanding U.S.$15,000,000 (the "SWING LINE FACILITY") and (ii) in an
amount not at any time exceeding the then amount of the Swing Line Reserve. No
Swing Line Advance shall be used for the purpose of funding the payment of
principal of any other Swing Line Advance. Each Swing Line Borrowing shall be
made as a Base Rate Advance. Within the limits of the Swing Line Facility and
within the limits referred to in clause (ii) above, the U.S. Borrower may borrow
under this Section 2.01(e), repay pursuant to Section 2.04(e) or prepay pursuant
to Section 2.06(a) and reborrow under this Section 2.01(e). (f) The Letters of
Credit. The Issuing Bank agrees, on the terms and conditions hereinafter set
forth, to issue letters of credit (the "LETTERS OF CREDIT") for the account of
the U.S. Borrower from time to time on any Business Day during the period from
the date hereof until 5 days before the Termination Date in an aggregate
Available Amount (i) for all Letters of Credit not to exceed at any time the
lesser of (x) the Letter of Credit Facility at such 48 43 time and (y) the
Issuing Bank's Letter of Credit Commitment at such time and (ii) for each such
Letter of Credit not to exceed the Unused Revolving Credit Commitments of the
Revolving Credit Lenders at such time. No Letter of Credit shall have an
expiration date (including all rights of the U.S. Borrower or the beneficiary to
require renewal) later than 5 days before the Termination Date and (A) in the
case of a Standby Letter of Credit, one year after the date of issuance thereof,
but may by its terms be renewable annually upon notice (a "NOTICE OF RENEWAL")
given to the Issuing Bank and the Administrative Agent on or prior to any date
for notice of renewal set forth in such Letter of Credit but in any event at
least three Business Days prior to the date of the proposed renewal of such
Standby Letter of Credit and upon fulfillment of the applicable conditions set
forth in Article III unless the Issuing Bank has notified the U.S. Borrower
(with a copy to the Administrative Agent) on or prior to the date for notice of
termination set forth in such Letter of Credit but in any event at least 30
Business Days prior to the date of automatic renewal of its election not to
renew such Standby Letter of Credit (a "NOTICE OF TERMINATION") and (B) in the
case of a Trade Letter of Credit, 180 days after the date of issuance thereof;
provided that the terms of each Standby Letter of Credit that is automatically
renewable annually shall (x) require the Issuing Bank that issued such Standby
Letter of Credit to give the beneficiary named in such Standby Letter of Credit
notice of any Notice of Termination, (y) permit such beneficiary, upon receipt
of such notice, to draw under such Standby Letter of Credit prior to the date
such Standby Letter of Credit otherwise would have been automatically renewed
and (z) not permit the expiration date (after giving effect to any renewal) of
such Standby Letter of Credit in any event to be extended to a date later than 5
days before the Termination Date. If either a Notice of Renewal is not given by
the U.S. Borrower or a Notice of Termination is given by the Issuing Bank
pursuant to the immediately preceding sentence, such Standby Letter of Credit
shall expire on the date on which it otherwise would have been automatically
renewed; provided, however, that even in the absence of receipt of a Notice of
Renewal the Issuing Bank may in its discretion, unless instructed to the
contrary by the Administrative Agent or the U.S. Borrower, deem that a Notice of
Renewal had been timely delivered and in such case, a Notice of Renewal shall be
deemed to have been so delivered for all purposes under this Agreement. Within
the limits of the Letter of Credit Facility, and subject to the limits referred
to above, the U.S. Borrower may request the issuance of Letters of Credit under
this Section 2.01(f), repay any Letter of Credit Advances resulting from
drawings thereunder pursuant to Section 2.03(c) and request the issuance of
additional Letters of Credit under this Section 2.01(f). SECTION 2.02. Making
the Advances. (a) Except as otherwise provided in Section 2.02(b), each
Borrowing shall be made on notice, given not later than 11:00 A.M. (New York
City time) on the third Business Day prior to the date of the proposed Borrowing
in the case of a Borrowing consisting of Eurodollar Rate Advances, on the fourth
Business Day prior to the date of the proposed Borrowing in the case of a
Borrowing consisting of Euro Rate Advances or on the first Business Day prior to
the date of the proposed Borrowing in the case of a Borrowing consisting of Base
Rate Advances, by the Applicable Borrower to the Administrative Agent, which
shall give to each Appropriate Lender prompt notice thereof by telex or
telecopier. Each such notice of a Borrowing (a "NOTICE OF BORROWING") shall be
Page 28
by 49 44 telephone, confirmed immediately in writing, or telex or telecopier, in
substantially the form of Exhibit B hereto, specifying therein the requested (i)
date of such Borrowing, (ii) Facility under which such Borrowing is to be made,
(iii) Type of Advances comprising such Borrowing, (iv) aggregate amount of such
Borrowing and (v) in the case of a Borrowing consisting of Euro Rate Advances or
Eurodollar Rate Advances, initial Interest Period for each such Advance. Each
Appropriate Lender shall, before 11:00 A.M. (New York City time) on the date of
such Borrowing, make available for the account of its Applicable Lending Office
to the Administrative Agent at the Administrative Agent's Account, in same day
funds, such Lender's ratable portion of such Borrowing in accordance with the
respective Commitments under the applicable Facility of such Lender and the
other Appropriate Lenders. After the Administrative Agent's receipt of such
funds and upon fulfillment of the applicable conditions set forth in Article
III, the Administrative Agent will make such funds available to the Applicable
Borrower by crediting the U.S. Borrower's Account; provided, however, that, in
the case of any Revolving Credit Borrowing, the Administrative Agent shall first
make a portion of such funds equal to the aggregate principal amount of any
Letter of Credit Advances made by the Issuing Banks and by any other Revolving
Credit Lender and outstanding on the date of such Revolving Credit Borrowing,
plus interest accrued and unpaid thereon to and as of such date, available to
the Issuing Bank and such other Revolving Credit Lenders for repayment of such
Letter of Credit Advances. (b) Swing Line Borrowings may be made on a daily
basis under mechanics mutually agreed to by the U.S. Borrower and the Swing Line
Bank. The Swing Line Reserve at any time shall be the amount (not exceeding
$15,000,000) most recently established by the U.S. Borrower by written notice to
the Administrative Agent confirmed in writing by the Swing Line Bank as the
maximum aggregate principal amount of Swing Line Borrowings to be outstanding at
any one time, provided, that, in no event shall the Swing Line Reserve exceed
$15,000,000 at any time. Swing Line Advances shall be made without any
requirement for a prior written or telephonic request given to the
Administrative Agent. The Swing Line Bank will notify the Administrative Agent,
on a monthly basis, of any Swing Line Advances so made. The Swing Line Bank
shall not at any time permit the aggregate outstanding amount of the Swing Line
Advances to exceed the then amount of the Swing Line Reserve. Upon written
demand by the Swing Line Bank, with a copy of such demand to the Administrative
Agent, each other Revolving Credit Lender shall purchase from the Swing Line
Bank, and the Swing Line Bank shall sell and assign to each such other Revolving
Credit Lender, such other Lender's Pro Rata Share of such outstanding Swing Line
Advance as of the date of such demand, by making available for the account of
its Applicable Lending Office to the Administrative Agent for the account of the
Swing Line Bank, by deposit to the Administrative Agent's Account, in same day
funds, an amount equal to the portion of the outstanding principal amount of
such Swing Line Advance to be purchased by such Lender. The U.S. Borrower hereby
agrees to each such sale and assignment. Each Revolving Credit Lender agrees to
purchase its Pro Rata Share of an outstanding Swing Line Advance on (i) the
Business Day on which demand therefor is made by the Swing Line Bank, provided
that notice of such demand is given not later than 11:00 A.M. (New York City
time) on such Business Day or (ii) the first Business Day next succeeding such
50 45 demand if notice of such demand is given after such time. Upon any such
assignment by the Swing Line Bank to any other Revolving Credit Lender of a
portion of a Swing Line Advance, the Swing Line Bank represents and warrants to
such other Lender that the Swing Line Bank is the legal and beneficial owner of
such interest being assigned by it, but makes no other representation or
warranty and assumes no responsibility with respect to such Swing Line Advance,
the Loan Documents or any Loan Party. If and to the extent that any Revolving
Credit Lender shall not have so made the amount of such Swing Line Advance
available to the Administrative Agent, such Revolving Credit Lender agrees to
pay to the Administrative Agent forthwith on demand such amount together with
interest thereon, for each day from the date of demand by the Swing Line Bank
until the date such amount is paid to the Administrative Agent, at the Federal
Funds Rate. If such Lender shall pay to the Administrative Agent such amount for
the account of the Swing Line Bank on any Business Day, such amount so paid in
respect of principal shall constitute a Swing Line Advance made by such Lender
Page 29
on such Business Day for purposes of this Agreement, and the outstanding
principal amount of the Swing Line Advance made by the Swing Line Bank shall be
reduced by such amount on such Business Day. Since the Swing Line Borrowings
will be made on a daily automated basis without review by the Administrative
Agent or the Swing Line Bank of the satisfaction of conditions precedent to
Swing Line Borrowings set forth herein, some Swing Line Borrowings may be made
without satisfaction of such conditions precedent (including without limitation
the condition precedent that no Default shall have occurred), but the Revolving
Credit Lenders shall nevertheless remain obligated to purchase their respective
Pro Rata Share of such Swing Line Borrowings as provided for herein. Nothing set
forth herein shall excuse the U.S. Borrower from its obligation to satisfy such
conditions. The Swing Line Bank agrees (with the concurrence of U.S. Borrower)
that it shall not make any Swing Line Advance after receipt of written notice
from the Administrative Agent that a Default or an Event of Default shall have
occurred which is continuing or that U.S. Borrower shall have otherwise failed
to satisfy all of the conditions precedent to further Swing Line Borrowings
hereunder. (c) Anything in subsection (a) above to the contrary notwithstanding,
the Applicable Borrower may not select Euro Rate Advances or Eurodollar Rate
Advances for any Borrowing if the aggregate amount of such Borrowing is less
than U.S.$5,000,000 (or the Equivalent in Euros at such time) or Eurodollar Rate
Advances if the obligation of the Appropriate Lenders to make Eurodollar Rate
Advances shall then be suspended pursuant to Section 2.09 or Section 2.10;
provided, however, that if the syndication under this Agreement has not been
completed on or prior to the Effective Date then the Applicable Borrower may
only select Euro Rate Advances or Eurodollar Rate Advances with 7-day Interest
Period until the earlier of (i) the date which is one month after the Effective
Date and (ii) the date the syndication has been completed as shall be specified
by the Joint Lead Arrangers in a notice to the Borrowers. In addition, the
Tranche A U.S. Term Advances may not be outstanding as part of more than three
separate Borrowings, the Tranche A Euro Term Advances may not be outstanding as
part of more than three separate Borrowings, the Tranche B Term Advances may not
be outstanding as part of more than six separate Borrowings and the Revolving
Credit Advances may not be outstanding as part of more than six separate
Borrowings. 51 46 (d) Each Notice of Borrowing shall be irrevocable and binding
on the Applicable Borrower. In the case of any Borrowing that the related Notice
of Borrowing specifies is to be comprised of Euro Rate Advances or Eurodollar
Rate Advances, the Applicable Borrower shall indemnify each Appropriate Lender
against any loss, cost or expense incurred by such Lender as a result of any
failure to fulfill on or before the date specified in such Notice of Borrowing
for such Borrowing the applicable conditions set forth in Article III,
including, without limitation, any loss (including loss of anticipated profits),
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by such Lender to fund the Advance to be made
by such Lender as part of such Borrowing when such Advance, as a result of such
failure, is not made on such date. (e) Unless the Administrative Agent shall
have received notice from an Appropriate Lender prior to the date of any
Borrowing under a Facility under which such Lender has a Commitment that such
Lender will not make available to the Administrative Agent such Lender's ratable
portion of such Borrowing, the Administrative Agent may assume that such Lender
has made such portion available to the Administrative Agent on the date of such
Borrowing in accordance with subsection (a) of this Section 2.02 and the
Administrative Agent may, in reliance upon such assumption, make available to
the Applicable Borrower on such date a corresponding amount. If and to the
extent that such Lender shall not have so made such ratable portion available to
the Administrative Agent, such Lender and the Applicable Borrower severally
agree to repay or pay to the Administrative Agent forthwith on demand such
corresponding amount and to pay interest thereon, for each day from the date
such amount is made available to the Applicable Borrower until the date such
amount is repaid or paid to the Administrative Agent, at (i) in the case of the
Applicable Borrower, the interest rate applicable at such time under Section
2.07 to Advances comprising such Borrowing and (ii) in the case of such Lender,
(A) the Federal Funds Rate in the case of Advances denominated in Dollars or (B)
the cost of funds incurred by the Administrative Agent in respect of such amount
Page 30
in the case of Advances denominated in Euros. If such Lender shall pay to the
Administrative Agent such corresponding amount, such amount so paid shall
constitute such Lender's Advance as part of such Borrowing for all purposes. (f)
The failure of any Lender to make the Advance to be made by it as part of any
Borrowing shall not relieve any other Lender of its obligation, if any,
hereunder to make its Advance on the date of such Borrowing, but no Lender shall
be responsible for the failure of any other Lender to make the Advance to be
made by such other Lender on the date of any Borrowing. SECTION 2.03. Issuance
of and Drawings and Reimbursement Under Letters of Credit. (a) Request for
Issuance. Each Letter of Credit shall be issued upon notice, given not later
than 11:00 A.M. (New York City time) on the tenth Business Day prior to the date
of the proposed issuance of such Letter of Credit, by the U.S. Borrower to the
Issuing Bank, which shall give to the Administrative Agent and each Revolving
Credit Lender prompt notice thereof by telex or telecopier. Each such notice of
issuance of a Letter of Credit (a "NOTICE OF 52 47 ISSUANCE") shall be by
telephone, confirmed immediately in writing, or telex or telecopier, specifying
therein the requested (A) date of such issuance (which shall be a Business Day),
(B) Available Amount of such Letter of Credit, (C) expiration date of such
Letter of Credit and whether such Letter of Credit is a Trade Letter of Credit,
(D) name and address of the beneficiary of such Letter of Credit and (E) form of
such Letter of Credit, and shall be accompanied by such application and
agreement for letter of credit as the Issuing Bank may specify to the U.S.
Borrower for use in connection with such requested Letter of Credit (a "LETTER
OF CREDIT AGREEMENT"). If (x) the requested form of such Letter of Credit is
acceptable to the Issuing Bank in its sole discretion and (y) the Issuing Bank
has not received notice of objection asserting that the conditions contained in
Section 3.02 have not been satisfied to such issuance from Lenders holding at
least a majority of the Revolving Credit Commitments and (z) issuance of the
requested Letter of Credit is within the limits of Section 2.01(f), the Issuing
Bank will, upon fulfillment of the applicable conditions set forth in Article
III, make such Letter of Credit available to the U.S. Borrower at its office
referred to in Section 8.02 or as otherwise agreed with the U.S. Borrower in
connection with such issuance. In the event and to the extent that the
provisions of any Letter of Credit Agreement shall conflict with this Agreement,
the provisions of this Agreement shall govern. (b) Letter of Credit Reports. The
Issuing Bank shall furnish (A) to the Administrative Agent on the first Business
Day of each week a written report summarizing issuance and expiration dates of
Letters of Credit issued during the previous week and drawings during such week
under all Letters of Credit, (B) to each Revolving Credit Lender on the first
Business Day of each month a written report summarizing issuance and expiration
dates of Letters of Credit issued during the preceding month and drawings during
such month under all Letters of Credit and (C) to the Administrative Agent and
each Revolving Credit Lender on the first Business Day of each calendar quarter
a written report setting forth the average daily aggregate Available Amount
during the preceding calendar quarter of all Letters of Credit. (c) Drawing and
Reimbursement. The payment by the Issuing Bank of a draft drawn under any Letter
of Credit shall constitute for all purposes of this Agreement the making by the
Issuing Bank of a Letter of Credit Advance, which shall be a Base Rate Advance,
in the amount of such draft. Upon written demand by the Issuing Bank, with a
copy of such demand to the Administrative Agent, each Revolving Credit Lender
shall purchase from the Issuing Bank, and the Issuing Bank shall sell and assign
to each such Revolving Credit Lender, such Lender's Pro Rata Share of such
outstanding Letter of Credit Advance as of the date of such purchase, by making
available for the account of its Applicable Lending Office to the Administrative
Agent for the account of the Issuing Bank, by deposit to the Administrative
Agent's Account, in same day funds, an amount equal to the portion of the
outstanding principal amount of such Letter of Credit Advance to be purchased by
such Revolving Credit Lender. Promptly after receipt thereof, the Administrative
Agent shall transfer such funds to the Issuing Bank. The U.S. Borrower hereby
agrees to each such sale and assignment. Each Revolving Credit Lender agrees to
purchase its Pro Rata Share of an outstanding Letter of Credit Advance on (i)
the Business Day on which demand therefor is made by the Issuing Bank, provided
that notice of such 53 48 demand is given not later than 11:00 A.M. (New York
Page 31
City time) on such Business Day, or (ii) the first Business Day next succeeding
such demand if notice of such demand is given after such time. Upon any such
assignment by the Issuing Bank to any Revolving Credit Lender of a portion of a
Letter of Credit Advance, the Issuing Bank represents and warrants to such other
Lender that the Issuing Bank is the legal and beneficial owner of such interest
being assigned by it, free and clear of any liens, but makes no other
representation or warranty and assumes no responsibility with respect to such
Letter of Credit Advance, the Loan Documents or any Loan Party. If and to the
extent that any Revolving Credit Lender shall not have so made the amount of
such Letter of Credit Advance available to the Administrative Agent, such
Revolving Credit Lender agrees to pay to the Administrative Agent forthwith on
demand such amount together with interest thereon, for each day from the date of
demand by the Issuing Bank until the date such amount is paid to the
Administrative Agent, at the Federal Funds Rate for its account or the account
of the Issuing Bank, as applicable. If such Lender shall pay to the
Administrative Agent such amount for the account of the Issuing Bank on any
Business Day, such amount so paid in respect of principal shall constitute a
Letter of Credit Advance made by such Lender on such Business Day for purposes
of this Agreement, and the outstanding principal amount of the Letter of Credit
Advance made by the Issuing Bank shall be reduced by such amount on such
Business Day. (d) Failure to Make Letter of Credit Advances. The failure of any
Lender to make the Letter of Credit Advance to be made by it on the date
specified in Section 2.03(c) shall not relieve any other Lender of its
obligation hereunder to make its Letter of Credit Advance on such date, but no
Lender shall be responsible for the failure of any other Lender to make the
Letter of Credit Advance to be made by such other Lender on such date. SECTION
2.04. Repayment of Advances. (a) Tranche A U.S. Term Advances. The U.S. Borrower
shall repay to the Administrative Agent for the ratable account of the Tranche A
U.S. Term Lenders the aggregate outstanding principal amount of the Tranche A
U.S. Term Advances on the following dates in the amounts indicated (which
amounts shall be reduced as a result of the application of prepayments in
accordance with Section 2.06). 54 49 Date Amount ---- ------ September 30,
2001 U.S.$2,062,500 December 31, 2001 U.S.$2,062,500 March 31, 2002
U.S.$2,062,500 June 30, 2002 U.S.$2,062,500 September 30, 2002 U.S.$4,125,000
December 31, 2002 U.S.$4,125,000 March 31, 2003 U.S.$4,125,000 June 30, 2003
U.S.$4,125,000 September 30, 2003 U.S.$6,187,500 December 31, 2003
U.S.$6,187,500 March 31, 2004 U.S.$6,187,500 June 30, 2004 U.S.$6,187,500
September 30, 2004 U.S.$8,250,000 December 31, 2004 U.S.$8,250,000 March 31,
2005 U.S.$8,250,000 June 30, 2005 U.S.$8,250,000 September 30, 2005
U.S.$10,312,500 December 31, 2005 U.S.$10,312,500 March 31, 2006
U.S.$10,312,500 June 30, 2006 U.S.$10,312,500 September 30, 2006
U.S.$10,312,500 December 31, 2006 U.S.$10,312,500 March 31, 2007
U.S.$10,312,500 Termination Date U.S.$10,312,500 provided, however, that the
final principal installment shall be repaid on the Termination Date in respect
of the Tranche A U.S. Term Facility and in any event shall be in an amount equal
to the aggregate principal amount of the Term Advances outstanding on such date.
(b) Tranche A Euro Term Advances. The Euro Borrower shall repay to the
Administrative Agent for the ratable account of the Tranche A Euro Term Lenders
the aggregate outstanding principal amount of the Tranche A Euro Term Advances
on the following dates in the amounts represented by the percentages set forth
below, as the respective percentages of the aggregate outstanding principal
amount, denominated in Euros, of the Tranche A Euro Term Advances outstanding as
of the Initial Extension of Credit (which amounts shall be reduced as a result
of the application of prepayments in accordance with Section 2.06). 55 50 Date
Percentage ---- ---------- September 30, 2001 1.25% December 31, 2001 1.25%
March 31, 2002 1.25% June 30, 2002 1.25% September 30, 2002 2.50% December 31,
2002 2.50% March 31, 2003 2.50% June 30, 2003 2.50% September 30, 2003 3.75%
December 31, 2003 3.75% March 31, 2004 3.75% June 30, 2004 3.75% September 30,
2004 5.00% December 31, 2004 5.00% March 31, 2005 5.00% June 30, 2005 5.00%
September 30, 2005 6.25% December 31, 2005 6.25% March 31, 2006 6.25% June 30,
2006 6.25% September 30, 2006 6.25% December 31, 2006 6.25% March 31, 2007
6.25% Termination Date 6.25% provided, however, that the final principal
installment shall be repaid on the Termination Date in respect of the Tranche A
Page 32
Euro Term Facility and in any event shall be in an amount equal to the aggregate
principal amount of the Tranche A Euro Term Advances outstanding on such date.
(c) Term B Advances. The U.S. Borrower shall repay to the Administrative Agent
for the ratable account of the Term B Lenders the aggregate outstanding
principal amount of the Term B Advances on the following dates in the amounts
indicated (which amounts shall be reduced as a result of the application of
prepayments in accordance with Section 2.06): 56 51 Date Amount ---- ------
September 30, 2001 U.S.$1,137,500 December 31, 2001 U.S.$1,137,500 March 31,
2002 U.S.$1,137,500 June 30, 2002 U.S.$1,137,500 September 30, 2002
U.S.$1,137,500 December 31, 2002 U.S.$1,137,500 March 31, 2003 U.S.$1,137,500
June 30, 2003 U.S.$1,137,500 September 30, 2003 U.S.$1,137,500 December 31,
2003 U.S.$1,137,500 March 31, 2004 U.S.$1,137,500 June 30, 2004 U.S.$1,137,500
September 30, 2004 U.S.$1,137,500 December 31, 2004 U.S.$1,137,500 March 31,
2005 U.S.$1,137,500 June 30, 2005 U.S.$1,137,500 September 30, 2005
U.S.$1,137,500 December 31, 2005 U.S.$1,137,500 March 31, 2006 U.S.$1,137,500
June 30, 2006 U.S.$1,137,500 September 30, 2006 U.S.$1,137,500 December 31,
2006 U.S.$1,137,500 March 31, 2007 U.S.$1,137,500 June 30, 2007 U.S.$1,137,500
September 30, 2007 U.S.$1,137,500 December 31, 2007 U.S.$1,137,500 March 31,
2008 U.S.$1,137,500 June 30, 2008 U.S.$1,137,500 September 30, 2008
U.S.$105,787,500 December 31, 2008 U.S.$105,787,500 March 31, 2009
U.S.$105,787,500 Termination Date U.S.$105,787,500 provided, however, that the
final principal installment shall be repaid on the Termination Date in respect
of the Term B Facility and in any event shall be in an amount equal to the
aggregate principal amount of the Term B Advances outstanding on such date. (d)
Revolving Credit Advances. The U.S. Borrower shall repay to the Administrative
Agent for the ratable account of the Revolving Credit Lenders on the Termination
Date in respect of the Revolving Credit Facility the aggregate principal amount
of the Revolving Credit Advances then outstanding. (e) Swing Line Advances. The
U.S. Borrower shall repay to the Administrative Agent for the account of the
Swing Line Bank and each other Revolving Credit Lender that has made a Swing
Line Advance the outstanding principal amount of each Swing Line Advance made by
each of them on the Termination Date in respect of the Revolving Credit
Facility, provided, to the extent the U.S. Borrower shall not have repaid such
Swing Line 57 52 Advance on the maturity date thereof specified in the
applicable demand, such Swing Line Advance shall automatically convert into a
Revolving Credit Advance, accruing interest at the Base Rate. (f) Letter of
Credit Advances. (i) The U.S. Borrower shall repay to the Administrative Agent
for the account of the Issuing Bank and each other Revolving Credit Lender that
has made a Letter of Credit Advance on the earlier of the thirtieth day after
the date on which such Advance was made and the Termination Date the outstanding
principal amount of each Letter of Credit Advance made by each of them,
provided, to the extent the U.S. Borrower shall not have repaid such Letter of
Credit Advance on the thirtieth day after the date on which such Advance was
made, such Letter of Credit Advance shall automatically convert into a Revolving
Credit Advance, which shall be a Base Rate Advance. (ii) The Obligations of the
U.S. Borrower under this Agreement, any Letter of Credit Agreement and any other
agreement or instrument relating to any Letter of Credit shall be unconditional
and irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement, such Letter of Credit Agreement and such other agreement or
instrument under all circumstances, including, without limitation, the following
circumstances (it being understood that any such payment by the U.S. Borrower is
without prejudice to, and does not constitute a waiver of, any rights the U.S.
Borrower might have or might acquire as a result of the payment by the Issuing
Bank of any draft or the reimbursement by the U.S. Borrower thereof): (A) any
lack of validity or enforceability of any Loan Document, any Letter of Credit
Agreement, any Letter of Credit or any other agreement or instrument relating
thereto (all of the foregoing being, collectively, the "L/C RELATED DOCUMENTS");
(B) any change in the time, manner or place of payment of, or in any other term
of, all or any of the Obligations of the U.S. Borrower in respect of any L/C
Related Document or any other amendment or waiver of or any consent to departure
from all or any of the L/C Related Documents; (C) the existence of any claim,
set-off, defense or other right that the U.S. Borrower may have at any time
against any beneficiary or any transferee of a Letter of Credit (or any Persons
Page 33
for which any such beneficiary or any such transferee may be acting), the
Issuing Bank or any other Person, whether in connection with the transactions
contemplated by the L/C Related Documents or any unrelated transaction; (D) any
statement or any other document presented under a Letter of Credit proving to be
forged, fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect; (E) payment by the Issuing
Bank under a Letter of Credit against presentation of a draft or certificate
that does not strictly comply with the terms of such Letter of Credit; 58 53 (F)
any exchange, release or non-perfection of any Collateral or other collateral,
or any release or amendment or waiver of or consent to departure from the
Guaranty or any other guarantee, for all or any of the Obligations of the U.S.
Borrower in respect of the L/C Related Documents; or (G) any other circumstance
or happening whatsoever, whether or not similar to any of the foregoing,
including, without limitation, any other circumstance that might otherwise
constitute a defense available to, or a discharge of, the U.S. Borrower or a
guarantor. SECTION 2.05. Termination or Reduction of the Commitments. (a)
Optional. The Applicable Borrower may, upon at least five Business Days' notice
to the Administrative Agent, terminate in whole or reduce in part the unused
portions of the Tranche A U.S. Term Commitments, the Tranche A Euro Term
Commitments, the Tranche B Term Commitments, the Unused Revolving Credit
Commitments and the Letter of Credit Facility; provided, however, that each
partial reduction of a Facility (i) shall be in an aggregate amount of
U.S.$5,000,000 (or the Equivalent in Euros at such time) or an integral multiple
of U.S.$1,000,000 (or the Equivalent in Euros at such time) in excess thereof
and (ii) shall be made ratably among the Appropriate Lenders in accordance with
their Commitments with respect to such Facility. (b) Mandatory. (i) On the date
of each repayment or prepayment of the Tranche A U.S. Term Advances, the
aggregate Tranche A U.S. Term Commitments of the Tranche A U.S. Term Lenders
shall be automatically and permanently reduced, on a pro rata basis, by an
amount equal to the amount by which the aggregate Tranche A U.S. Term
Commitments immediately prior to such reduction exceed the aggregate unpaid
principal amount of the Tranche A U.S. Term Advances then outstanding. (ii) On
the date of each repayment or prepayment of the Tranche A Euro Term Advances,
the aggregate Tranche A Euro Term Commitments of the Tranche A Euro Term Lenders
shall be automatically and permanently reduced, on a pro rata basis, by an
amount equal to the amount by which the aggregate Tranche A Euro Term
Commitments immediately prior to such reduction exceed the aggregate unpaid
principal amount of the Tranche A Euro Term Advances then outstanding. (iii) On
the date of each repayment or prepayment of the Tranche B Term Advances, the
aggregate Tranche B Term Commitments of the Tranche B Term Lenders shall be
automatically and permanently reduced, on a pro rata basis, by an amount equal
to the amount by which the aggregate Tranche B Term Commitments immediately
prior to such reduction exceed the aggregate unpaid principal amount of the
Tranche B Term Advances then outstanding. (iv) The Swing Line Facility shall be
permanently reduced from time to time on the date of each reduction in the
Revolving Credit Facility by the amount, if any, by which the amount of the
Swing Line Facility exceeds the Revolving Credit Facility after giving effect to
such reduction of the Revolving Credit Facility. 59 54 (v) The Revolving Credit
Facility shall be automatically and permanently reduced, on each date on which
prepayment thereof is required to be made pursuant to Section 2.06(b)(i) or (ii)
in an amount equal to the applicable Reduction Amount, provided that each such
reduction of the Revolving Credit Facility shall be made ratably among the
Revolving Credit Lenders in accordance with their Revolving Credit Commitments.
(vi) The Letter of Credit Facility shall be permanently reduced from time to
time on the date of each reduction in the Revolving Credit Facility by the
amount, if any, by which the amount of the Letter of Credit Facility exceeds the
Revolving Credit Facility after giving effect to such reduction of the Revolving
Credit Facility. SECTION 2.06. Prepayments. (a) Optional. The Applicable
Borrower may, upon at least one Business Day's notice in the case of Base Rate
Advances and three Business Days' notice in the case of Euro Rate Advances or
Eurodollar Rate Advances, in each case to the Administrative Agent stating the
proposed date and aggregate principal amount of the prepayment, and if such
notice is given the Applicable Borrower shall, prepay the outstanding aggregate
Page 34
principal amount of the Advances comprising part of the same Borrowing in whole
or ratably in part, together with accrued interest to the date of such
prepayment on the aggregate principal amount prepaid at any time and from time
to time, without premium or penalty; provided, however, that (x) each partial
prepayment shall be in an aggregate principal amount of U.S.$3,000,000 (or the
Equivalent in Euros at such time) or an integral multiple of U.S.$1,000,000 (or
the Equivalent in Euros at such time) in excess thereof and (y) if any
prepayment of a Euro Rate Advance or a Eurodollar Rate Advance is made on a date
other than the last day of an Interest Period for such Advance, the Applicable
Borrower shall also pay any amounts owing pursuant to Section 9.04(c). Each such
prepayment shall be applied, at the option of the U.S. Borrower either (i) to
the next four installments in order of maturity of the Tranche A U.S. Term
Facility, the Tranche A Euro Term Facility and the Tranche B Term Facility and
to such installments on a pro rata basis, subject to Section 2.06(c), or (ii) to
the Revolving Credit Facility or (iii) to the Swing Line Advances or (iv) to the
Letter of Credit Advances. Notwithstanding the foregoing, prepayment of Swing
Line Advances held by the Swing Line Bank shall not require any prior notice.
(b) Mandatory. (i) The Applicable Borrower shall, on the 90th day following the
end of each Fiscal Year, beginning with Fiscal Year 2002, prepay an aggregate
principal amount of the Advances comprising part of the same Borrowings and
deposit an amount in the L/C Cash Collateral Account in an amount equal to (A)
if the Total Debt/EBITDA Ratio at such time is greater than 4.00:1.00, 75% of
Excess Cash Flow for such Fiscal Year, or (B) if the Total Debt/EBITDA Ratio at
such time is less than or equal to 4.00:1.00 but greater than 2.50:1.00, 50% of
Excess Cash Flow for such Fiscal Year. No such prepayment shall be required if
the Total Debt/EBITDA Ratio is equal to or less than 2.50:1.00. Each such
prepayment shall be applied first to the next four installments in order of
maturity of the Tranche A U.S. Term Facility, the Tranche A Euro Term Facility
and the Tranche B Term Facility and to such 60 55 installments on a pro rata
basis, subject to Section 2.06(c), and second to the Revolving Credit Facility
as set forth in clause (v) hereof. (ii) The Applicable Borrower shall, on the
date of receipt of the Net Cash Proceeds by the Parent or any of its
Subsidiaries from (A) the sale, lease, transfer or other disposition of any
assets of the Parent or any of its Subsidiaries (other than any sale, lease,
transfer or other disposition of (i) Inventory, Equipment or other operating
assets in the ordinary course of business and not as a part of the sale of a
business, and (ii) other assets for Net Cash Proceeds, in the aggregate, not to
exceed U.S.$1,000,000, in any Fiscal Year), (B) the incurrence or issuance by
the Parent or any of its Subsidiaries of any Debt (other than Debt permitted by
Section 5.02(b)), (C) the issuance and sale by the Parent or any of its
Subsidiaries of any Equity Interests (including, without limitation, receipt of
any capital contribution but excluding (i) any issuance of Equity Interests of
the Parent solely for the purpose of repaying the Senior Subordinated Notes or
any other Debt permitted by Section 5.02(b), (ii) any issuance of Equity
Interests by the U.S. Borrower to the Parent or by any Subsidiary of the U.S.
Borrower to the U.S. Borrower or another Subsidiary of the U.S. Borrower, (iii)
50% of any Net Cash Proceeds from any issuance of Equity Interests of the Parent
or any of its Subsidiaries pursuant to a bona fide underwritten initial public
offering if the Total Debt/EBITDA Ratio at such time is equal to or greater than
2.00:1.00 (calculated after giving effect to the application of the proceeds of
such issuance), (iv) 100% of any Net Cash Proceeds from any issuance of Equity
Interests of the Parent or any of its Subsidiaries pursuant to a bona fide
underwritten initial public offering if the Total Debt/EBITDA Ratio at such time
is less than 2.00:1.00 (calculated after giving effect to the application of the
proceeds of such issuance), and (v) any issuance of Equity Interests of the
Parent or any of its Subsidiaries solely to finance a Permitted Acquisition or
the Pending Acquisition) and (D) any Extraordinary Receipt received by or paid
to or for the account of the Parent or any of its Subsidiaries and not otherwise
included in clause (A), (B) or (C) above, prepay an aggregate principal amount
of the Advances comprising part of the same Borrowings and deposit an amount in
the L/C Cash Collateral Account, as applicable, in an amount equal to the amount
of such Net Cash Proceeds. Each such prepayment shall be applied first ratably
to the Tranche A U.S. Term Facility, the Tranche A Euro Term Facility and the
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Tranche B Term Facility and to the installments thereof on a pro rata basis,
subject to the provisions of Section 2.06(c), and second to the Revolving Credit
Facility as set forth in clause (v) hereof. (iii) The U.S. Borrower shall, on
each Business Day, prepay an aggregate principal amount of the Revolving Credit
Advances comprising part of the same Borrowings, the Letter of Credit Advances
and the Swing Line Advances and deposit an amount in the L/C Cash Collateral
Account in an amount equal to the amount by which (A) the sum of the aggregate
principal amount of (x) the Revolving Credit Advances, (y) the Swing Line
Advances and (z) the Letter of Credit Advances then outstanding plus the
aggregate Available Amount of all Letters of Credit then outstanding exceeds (B)
the Revolving Credit Facility on such Business Day. (iv) The U.S. Borrower
shall, on each Business Day, pay to the Administrative Agent for deposit in the
L/C Cash Collateral Account an amount sufficient to cause the aggregate 61 56
amount on deposit in the L/C Cash Collateral Account to equal the amount by
which the aggregate Available Amount of all Letters of Credit then outstanding
exceeds the Letter of Credit Facility on such Business Day. (v) Prepayments of
the Revolving Credit Facility made pursuant to clause (i), (ii) or (iii) above
shall be first applied to prepay Letter of Credit Advances then outstanding
until such Advances are paid in full, second applied to prepay Revolving Credit
Advances then outstanding comprising part of the same Borrowings until such
Advances are paid in full and third deposited in the L/C Cash Collateral Account
to cash collateralize 100% of the Available Amount of the Letters of Credit then
outstanding; and, in the case of prepayments of the Revolving Credit Facility
required pursuant to clause (i) or (ii) above, the amount remaining (if any)
after the prepayment in full of the Advances then outstanding and the 100% cash
collateralization of the aggregate Available Amount of Letters of Credit then
outstanding (the sum of such prepayment amounts, cash collateralization amounts
and remaining amount being referred to herein as the "REDUCTION AMOUNT") may, if
not used as set forth above, be retained by the U.S. Borrower and the Revolving
Credit Facility shall be permanently reduced as set forth in Section 2.05(b)(v).
Upon the drawing of any Letter of Credit for which funds are on deposit in the
L/C Cash Collateral Account, such funds shall be applied to reimburse the
Issuing Bank or the Revolving Credit Lenders, as applicable. (vi) All
prepayments under this subsection (b) shall be made together with accrued
interest to the date of such prepayment on the principal amount prepaid. (c)
Tranche B Opt Out. With respect to any prepayment of Tranche A U.S. Term
Advances, Tranche A Euro Term Advances or Tranche B Term Advances, the
Administrative Agent shall ratably pay the Tranche A U.S. Term Lenders, the
Tranche A Euro Term Lenders and Tranche B Term Lenders; provided, however, that
any Tranche B Lender, at its option, to the extent that any Tranche A U.S. Term
Advances or Tranche A Euro Term Advances are then outstanding, may elect not to
accept such prepayment. Upon receipt by the Administrative Agent of any such
prepayment, the amount of the prepayment that is available to prepay the Tranche
B Term Advances shall be deposited in a cash collateral account on terms
reasonably satisfactory to the Administrative Agent and the Borrowers (the
"PREPAYMENT AMOUNT"), pending application of such amount on the Prepayment Date
as set forth below and promptly after such receipt (the date of such receipt
being the "RECEIPT DATE"), the Administrative Agent shall give written notice to
the Tranche B Term Lenders of the amount available to prepay the Term B Advances
and the date on which such prepayment shall be made (the "PREPAYMENT DATE"),
which date shall be 10 days after the Receipt Date. Any Lender declining such
prepayment (a "DECLINING LENDER") shall given written notice to the
Administrative Agent by 11:00 A.M. (New York City time) on the Business Day
immediately preceding the Prepayment Date. On the Prepayment Date, an amount
equal to that portion of the Prepayment Amount accepted by the Tranche B Term
Lenders other than the Declining Lenders (such Lenders being the "ACCEPTING
LENDERS") to prepay Tranche B Term Advances owing to such Accepting Lenders
shall be withdrawn from the cash collateral account and applied to 62 57 prepay
Tranche B Term Advances owing to such Accepting Lenders on a pro rata basis. Any
amounts that would otherwise have been applied to prepay Advances under the
Tranche B Term Facility owing to Declining Lenders shall instead be applied
ratably to prepay the remaining Tranche A U.S. Term Advances and Tranche A Euro
Term Advances as provided in Section 2.06(a) and (b)(i). SECTION 2.07. Interest.
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(a) Scheduled Interest. The Applicable Borrower shall pay interest on the unpaid
principal amount of each Advance owing to each Lender from the date of such
Advance until such principal amount shall be paid in full, at the following
rates per annum: (i) Base Rate Advances. During such periods as such Advance is
a Base Rate Advance, a rate per annum equal at all times to the sum of (A) the
Base Rate in effect from time to time plus (B) the Applicable Margin in effect
from time to time, payable in arrears quarterly on the last day of each March,
June, September and December during such periods and on the date such Base Rate
Advance shall be Converted or paid in full. (ii) Eurodollar Rate Advances.
During such periods as such Advance is a Eurodollar Rate Advance, a rate per
annum equal at all times during each Interest Period for such Advances to the
sum of (A) the Eurodollar Rate for such Interest Period for such Advance plus
(B) the Applicable Margin in effect from time to time, payable in arrears on the
last day of such Interest Period and, if such Interest Period has a duration of
more than three months, on each day that occurs during such Interest Period
every three months from the first day of such Interest Period and on the date
such Eurodollar Rate Advance shall be Converted or paid in full. (iii) Euro Rate
Advances. During such periods as such Advance is a Euro Rate Advance, a rate per
annum equal at all times during each Interest Period for such Advance, to the
sum of (A) the Euro Rate for such Interest Period for such Advance plus (B) the
Applicable Margin in effect from time to time plus (C) any Associated Costs
applicable from time to time, payable in arrears on the last day of such
Interest Period and, if such Interest Period has a duration of more than three
months, on each day that occurs during such Interest Period every three months
from the first day of such Interest Period and on the date such Euro Rate
Advance shall be paid in full. (b) Default Interest. Upon the occurrence and
during the continuance of an Event of Default and the request of the Required
Lenders, interest shall accrue on (i) the unpaid principal amount of each
Advance owing to each Lender, payable in arrears on the dates referred to in
clause (a)(i), (a)(ii) or (a)(iii) above and on demand, at a rate per annum
equal at all times to 2% per annum above the rate per annum required to be paid
on such Advance pursuant to clause (a)(i), (a)(ii) or (a)(iii) above and (ii) to
the fullest extent permitted by law, the amount of any interest, fee or other
amount payable under the Loan Documents that is not paid when due, from the date
such amount shall be due until such amount shall be paid in full, payable in
arrears on the date such amount shall be paid in full and on demand, at a rate
per annum equal at all 63 58 times to 2% per annum above the rate per annum
required to be paid, in the case of interest, on the Advance on which such
interest has accrued pursuant to clause (a)(i), (a)(ii) or (a)(iii) above and,
in all other cases, on Base Rate Advances pursuant to clause (a)(i) above. (c)
Notice of Interest Period and Interest Rate. Promptly after receipt of a Notice
of Borrowing pursuant to Section 2.02(a), a notice of Conversion pursuant to
Section 2.09 or a notice of selection of an Interest Period pursuant to the
terms of the definition of "Interest Period", the Administrative Agent shall
give notice to the Applicable Borrower and each Appropriate Lender of the
applicable Interest Period and the applicable interest rate determined by the
Administrative Agent for purposes of clause (a)(i), (a)(ii) or (a)(iii) above.
SECTION 2.08. Fees. (a) Commitment Fee. The Applicable Borrower shall pay to the
Administrative Agent for the account of the Revolving Credit Lenders a
commitment fee, from the date of the Initial Extension of Credit, payable in
arrears quarterly on the last day of each March, June, September and December,
commencing June 30, 2001, and on the Termination Date, at the rate equal to the
Applicable Percentage then in effect on the average daily portion of the sum of
each Revolving Credit Lender's Unused Revolving Credit Commitment, and its Pro
Rata Share of the Swing Line Reserve (except, for any day, Swing Line Advances
then made by, and outstanding to, such Revolving Credit Lender) during such
period; provided, however, that any commitment fee accrued with respect to any
of the Commitments of a Defaulting Lender during the period prior to the time
such Lender became a Defaulting Lender and unpaid at such time shall not be
payable by the Applicable Borrower so long as such Lender shall be a Defaulting
Lender except to the extent that such commitment fee shall otherwise have been
due and payable by such Applicable Borrower prior to such time; and provided
further that no commitment fee shall accrue on any of the Commitments of a
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Defaulting Lender so long as such Lender shall be a Defaulting Lender. (b)
Agents' Fees. The U.S. Borrower shall pay such further fees as set forth in that
certain Fee Letter dated January 30, 2001. (c) Letter of Credit Fees, Etc. (i)
The U.S. Borrower shall pay to the Administrative Agent for the account of each
Revolving Credit Lender a commission, payable in arrears quarterly on the last
day of each March, June, September and December, commencing June 30, 2001, and
on the earliest to occur of the full drawing, expiration, termination or
cancellation of any Letter of Credit and on the Termination Date, on such
Lender's Pro Rata Share of the average daily aggregate Available Amount during
such quarter, at a rate equal to the then Applicable Margin for Eurodollar Rate
Advances under the Revolving Credit Facility. (ii) The U.S. Borrower shall pay
to the Issuing Bank, for its own account, (A) an issuance fee for each Letter of
Credit in an amount equal to 0.125% of the Available Amount of such Letter of
Credit on the date of issuance thereof, payable on such date, or such other
amount as the U.S. Borrower and the Issuing Bank may agree and (B) such other
commissions, fronting fees, transfer fees and other fees and charges in
connection with the 64 59 issuance or administration of each Letter of Credit as
the U.S. Borrower and the Issuing Bank shall agree. SECTION 2.09. Conversion of
Advances. (a) Optional. The U.S. Borrower may on any Business Day, upon notice
given to the Administrative Agent not later than 11:00 A.M. (New York City time)
on the third Business Day prior to the date of the proposed Conversion and
subject to the provisions of Section 2.10, Convert all or any portion of the
Advances of one Type comprising the same Borrowing into Advances of the other
Type; provided, however, that any Conversion of Eurodollar Rate Advances into
Base Rate Advances shall be made only on the last day of an Interest Period for
such Eurodollar Rate Advances, any Conversion of Base Rate Advances into
Eurodollar Rate Advances shall be in an amount not less than the minimum amount
specified in Section 2.02(c), no Conversion of any Advances shall result in more
separate Borrowings than permitted under Section 2.02(c) and each Conversion of
Advances comprising part of the same Borrowing under any Facility shall be made
ratably among the Appropriate Lenders in accordance with their Commitments under
such Facility. Each such notice of Conversion shall, within the restrictions
specified above, specify (i) the date of such Conversion, (ii) the Advances to
be Converted and (iii) if such Conversion is into Eurodollar Rate Advances, the
duration of the initial Interest Period for such Advances. Each notice of
Conversion shall be irrevocable and binding on the U.S. Borrower. (b) Mandatory.
(i) If the Applicable Borrower shall fail to select the duration of any Interest
Period for any Eurodollar Rate Advances or Euro Rate Advances, as the case may
be, in accordance with the provisions contained in the definition of "Interest
Period" in Section 1.01, the Administrative Agent will forthwith so notify the
Applicable Borrower and the Appropriate Lenders, whereupon each such Eurodollar
Rate Advance or Euro Rate Advance, as the case may be, will automatically, on
the last day of the then existing Interest Period therefor, be continued as a
Eurodollar Rate Advance or Euro Rate Advance, as the case may be, for a
one-month Interest Period. (ii) Upon the occurrence and during the continuance
of any Event of Default, (x) each Eurodollar Rate Advance will automatically, on
the last day of the then existing Interest Period therefor, Convert into a Base
Rate Advance and (y) the obligation of the Lenders to make, or to Convert
Advances into, Eurodollar Rate Advances shall be suspended. SECTION 2.10.
Increased Costs, Etc. (a) If, due to either (i) the introduction of or any
change in or in the interpretation of any law or regulation after the date
hereof or (ii) the compliance with any guideline or request issued or made after
the date hereof by any central bank or other governmental authority, including,
without limitation, any agency of the European Union or similar monetary or
multinational authority (whether or not having the force of law), there shall be
any increase in the cost to any Lender Party of agreeing to make or of making,
funding or maintaining Euro Rate Advances or Eurodollar Rate Advances or of
agreeing to issue or of issuing or maintaining or participating in Letters of
Credit or of agreeing to make or of making or maintaining Letter of Credit
Advances (excluding, for purposes of this Section 2.10, any such increased costs
resulting from or representing (x) Taxes or Other Taxes 65 60 (as to which
Section 2.12 shall govern) and (y) Excluded Taxes), then the Applicable Borrower
shall from time to time, upon demand by such Lender Party (with a copy of such
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demand to the Administrative Agent), pay to the Administrative Agent for the
account of such Lender Party additional amounts sufficient to compensate such
Lender Party for such increased cost; provided, however, that a Lender Party
claiming additional amounts under this Section 2.10(a) agrees to use reasonable
efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different Applicable Lending Office if the making
of such a designation would avoid the need for, or reduce the amount of, such
increased cost that may thereafter accrue and would not, in the reasonable
judgment of such Lender Party, be otherwise disadvantageous to such Lender
Party. A certificate as to the amount of such increased cost, submitted to the
Applicable Borrower by such Lender Party, shall be conclusive and binding for
all purposes, absent manifest error. (b) If, due to either (i) the introduction
of or any change in or in the interpretation of any law or regulation after the
date hereof or (ii) the compliance with any guideline or request issued or made
after the date hereof by any central bank or other governmental authority,
including, without limitation, any agency of the European Union or similar
monetary or multinational authority (whether or not having the force of law),
there shall be any increase in the amount of capital required or expected to be
maintained by any Lender Party or any corporation controlling such Lender Party
as a result of or based upon the existence of such Lender Party's commitment to
lend or to issue or participate in Letters of Credit hereunder and other
commitments of such type or the issuance or maintenance of or participation in
the Letters of Credit (or similar contingent obligations), then, upon demand by
such Lender Party or such corporation (with a copy of such demand to the
Administrative Agent), the Applicable Borrower shall pay to the Administrative
Agent for the account of such Lender Party, from time to time as specified by
such Lender Party, additional amounts sufficient to compensate such Lender Party
in the light of such circumstances, to the extent that such Lender Party
reasonably determines such increase in capital to be allocable to the existence
of such Lender Party's commitment to lend or to issue or participate in Letters
of Credit hereunder or to the issuance or maintenance of or participation in any
Letters of Credit. A certificate as to such amounts submitted to the Applicable
Borrower by such Lender Party shall be conclusive and binding for all purposes,
absent manifest error. (c) (i) If, with respect to any Eurodollar Rate Advances
under any Facility, the Required Lenders notify the Administrative Agent in
writing, that the Eurodollar Rate for such Interest Period will not adequately
reflect the cost to such Lenders of making, funding or maintaining their
Eurodollar Rate Advances for such Interest Period (setting forth in the writing
the nature and amount of such costs), the Administrative Agent shall forthwith
so notify the U.S. Borrower and the Appropriate Lenders, whereupon, unless the
U.S. Borrower offers to pay such increased costs to such Lenders, (x) each such
Eurodollar Rate Advance under such Facility will automatically, on the last day
of the then existing Interest Period therefor, Convert into a Base Rate Advance
and (y) the obligation of the Appropriate Lenders to make, or to Convert
Advances into such Eurodollar Rate Advances shall be suspended until the
Administrative Agent 66 61 shall notify the U.S. Borrower that such Lenders have
determined that the circumstances causing such suspension no longer exist. (ii)
If, with respect to any Euro Rate Advances under the Tranche A Euro Term
Facility, Tranche A Euro Term Lenders holding at least a majority of the Tranche
A Euro Term Commitments notify in writing, the Administrative Agent that the
Euro Rate for any Interest Period for such Advances will not adequately reflect
the cost to such Lenders of making, funding or maintaining their Euro Rate
Advances for such Interest Period (setting forth in the writing the nature and
amount of such costs), the Administrative Agent shall forthwith so notify the
Euro Borrower and the Appropriate Lenders, whereupon, unless the Euro Borrower
offers to pay such increased costs to such Lenders, the applicable Euro Rate
shall be determined by the Administrative Agent on the basis set forth in the
proviso to the definition of Euro Rate. (d) (i) Notwithstanding any other
provision of this Agreement, if the introduction of or any change in or in the
interpretation of any law or regulation shall make it unlawful, or any central
bank or other governmental authority shall assert that it is unlawful, for any
Lender or its Eurodollar Lending Office to perform its obligations hereunder to
make Eurodollar Rate Advances or to continue to fund or maintain Eurodollar Rate
Page 39
Advances hereunder, then, on notice thereof and demand therefor by such Lender
to the U.S. Borrower through the Administrative Agent, (x) each Eurodollar Rate
Advance under each Facility under which such Lender has a Commitment will
automatically, upon such demand, Convert into a Base Rate Advance and (y) the
obligation of the Appropriate Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended until the Administrative Agent shall
notify the U.S. Borrower that such Lender has determined that the circumstances
causing such suspension no longer exist; provided, however, that, before making
any such demand, such Lender agrees to use reasonable efforts (consistent with
its internal policy and legal and regulatory restrictions) to designate a
different Eurodollar Lending Office if the making of such a designation would
allow such Lender or its Eurodollar Lending Office to continue to perform its
obligations to make Eurodollar Rate Advances or to continue to fund or maintain
Eurodollar Rate Advances and would not, in the judgment of such Lender, be
otherwise disadvantageous to such Lender. (ii) Notwithstanding any other
provision of this Agreement, if the introduction of or any change in or in the
interpretation of any law or regulation shall make it unlawful, or any central
bank or other governmental authority shall assert that it is unlawful, for any
Tranche A Euro Term Lender or its Euro Lending Office to perform its obligations
hereunder to make Euro Rate Advances
Page 40
