EXHIBIT 5
$75,000,000
CREDIT AND SECURITY AGREEMENT
dated as of
October 9, 2003,
among
XXXXXX INC.,
BELDEN TECHNOLOGIES, INC.,
BELDEN COMMUNICATIONS COMPANY,
and
XXXXXX WIRE & CABLE COMPANY,
as Borrowers,
The Lenders listed herein,
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Agent,
and
and U.S. BANK NATIONAL ASSOCIATION,
as Syndication Agent
Arranger: WACHOVIA CAPITAL MARKETS, LLC
ARTICLE 1 DEFINITIONS......................................................................... 1
SECTION 1.01. Definitions................................................................. 1
SECTION 1.02. Accounting Terms and Determinations......................................... 31
SECTION 1.03. References.................................................................. 31
SECTION 1.04. Use of Defined Terms........................................................ 31
SECTION 1.05. Terminology................................................................. 32
ARTICLE 2 THE CREDITS......................................................................... 32
SECTION 2.01. Commitments to Lend......................................................... 32
SECTION 2.02. Method of Borrowing......................................................... 34
SECTION 2.03. Continuation and Conversion Elections....................................... 36
SECTION 2.04. Notes....................................................................... 36
SECTION 2.05. Maturity of Loans........................................................... 37
SECTION 2.06. Interest Rates.............................................................. 37
SECTION 2.07. Fees........................................................................ 39
SECTION 2.08. Optional Termination or Reduction of Commitments............................ 40
SECTION 2.09. Mandatory Reduction and Termination of Commitments.......................... 40
SECTION 2.10. Optional Prepayments........................................................ 40
SECTION 2.11. Mandatory Prepayments....................................................... 40
SECTION 2.12. General Provisions as to Payments........................................... 41
SECTION 2.13. Computation of Interest and Fees............................................ 45
SECTION 2.14. All Loans to Constitute One Obligation...................................... 45
SECTION 2.15. Lockbox; Collateral Reserve Accounts; Control Agreements.................... 45
SECTION 2.16. Issuance of Letters of Credit............................................... 48
SECTION 2.17. Conditions and Amounts of Letters of Credit................................. 48
SECTION 2.18. Requests for Issuance of Letters of Credit.................................. 48
SECTION 2.19. Letter of Credit Reimbursement Obligations; Duties of the LC Issuer......... 49
SECTION 2.20. Letter of Credit Participations............................................. 50
SECTION 2.21. Payment of Letter of Credit Reimbursement Obligations....................... 52
SECTION 2.22. Compensation for Letters of Credit and Reporting Requirements............... 53
SECTION 2.23. Indemnification and Exoneration with respect to Letters of Credit........... 53
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ARTICLE 3 COLLATERAL.......................................................................... 54
SECTION 3.01. Grant of Security Interest.................................................. 55
SECTION 3.02. Further Assurances.......................................................... 56
ARTICLE 4 REPRESENTATIONS AND WARRANTIES...................................................... 56
SECTION 4.01. Corporate Existence and Power............................................... 57
SECTION 4.02. Corporate and Governmental Authorization; No Contravention.................. 57
SECTION 4.03. Binding Effect.............................................................. 57
SECTION 4.04. Financial Information....................................................... 57
SECTION 4.05. Litigation.................................................................. 58
SECTION 4.06. Compliance with ERISA....................................................... 58
SECTION 4.07. Compliance with Laws; Payment of Taxes...................................... 58
SECTION 4.08. Investment Company Act...................................................... 58
SECTION 4.09. Public Utility Holding Company Act.......................................... 59
SECTION 4.10. Ownership of Property; Liens................................................ 59
SECTION 4.11. No Default.................................................................. 59
SECTION 4.12. Full Disclosure............................................................. 59
SECTION 4.13. Environmental Matters....................................................... 59
SECTION 4.14. Capital Stock............................................................... 60
SECTION 4.15. Margin Stock................................................................ 60
SECTION 4.16. Insolvency.................................................................. 60
SECTION 4.17. Insurance................................................................... 61
SECTION 4.18. Purchase of Collateral...................................................... 61
SECTION 4.19. Possession of Permits....................................................... 61
SECTION 4.20. Labor Disputes.............................................................. 61
SECTION 4.21. Surety Obligations.......................................................... 61
SECTION 4.22. Restrictions................................................................ 61
SECTION 4.23. Leases...................................................................... 62
SECTION 4.24. Business Conduct............................................................ 62
SECTION 4.25. Capital Structure........................................................... 62
SECTION 4.26. Article 9 Information....................................................... 62
SECTION 4.27. Accounts.................................................................... 62
SECTION 4.28. Good Title to Collateral.................................................... 63
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SECTION 4.29. Right to Assign and Grant Security Interest................................. 63
SECTION 4.30. Trade Styles................................................................ 63
SECTION 4.31. Farm Products............................................................... 63
SECTION 4.32. Investment Property......................................................... 64
SECTION 4.33. Intellectual Property....................................................... 64
SECTION 4.34. Account Debtor Capacity and Solvency........................................ 65
SECTION 4.35. Proceedings with Respect to Accounts........................................ 65
SECTION 4.36. Location of Collateral...................................................... 65
SECTION 4.37. Inventory................................................................... 65
SECTION 4.38. Material Contracts.......................................................... 65
SECTION 4.39. Force Majeure............................................................... 66
SECTION 4.40. Survival of Representations and Warranties.................................. 66
ARTICLE 5 COVENANTS........................................................................... 66
SECTION 5.01. Information................................................................. 66
SECTION 5.02. Inspection of Property, Books and Records................................... 70
SECTION 5.03. Maintenance of Existence.................................................... 70
SECTION 5.04. Dissolution................................................................. 70
SECTION 5.05. Consolidations and Mergers.................................................. 70
SECTION 5.06. Use of Proceeds............................................................. 71
SECTION 5.07. Compliance with Laws; Payment of Taxes...................................... 71
SECTION 5.08. Insurance; Net Casualty/Insurance Proceeds.................................. 71
SECTION 5.09. Change in Fiscal Year....................................................... 72
SECTION 5.10. Maintenance of Property..................................................... 73
SECTION 5.11. Material Contracts.......................................................... 73
SECTION 5.12. Environmental Matters....................................................... 73
SECTION 5.13. Environmental Release....................................................... 73
SECTION 5.14. Transactions with Affiliates................................................ 73
SECTION 5.15. Special Provisions Concerning Subsidiaries.................................. 74
SECTION 5.16. Restricted Payments and Investments and Acquisitions........................ 74
SECTION 5.17. Permitted Liens............................................................. 76
SECTION 5.18. Restrictions on Ability of Borrower and Subsidiaries to Pay Dividends....... 77
SECTION 5.19. Financial Covenants......................................................... 78
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SECTION 5.20. Permitted Debt.............................................................. 78
SECTION 5.21. Limitation on Issuance and Sale of Capital Stock and Redeemable Preferred
Stock of Subsidiaries....................................................... 80
SECTION 5.22. Change of Location of Collateral............................................ 80
SECTION 5.23. Physical Inventories........................................................ 80
SECTION 5.24. Inventory Returns........................................................... 80
SECTION 5.25. Intellectual Property....................................................... 80
SECTION 5.26. Records Respecting Collateral............................................... 82
SECTION 5.27. Reports Respecting Collateral............................................... 83
SECTION 5.28. Collateral Location Waivers................................................. 83
SECTION 5.29. Appraisals; Field Examinations.............................................. 83
SECTION 5.30. Payment of Taxes On and Use of Collateral................................... 83
SECTION 5.31. Dispositions of Collateral.................................................. 84
SECTION 5.32. Changes to Federal Taxpayer Identification Number; Organizational
Identification Number....................................................... 84
SECTION 5.33. Discounts and Allowances.................................................... 85
SECTION 5.34. Taxes Owing with Respect to Accounts........................................ 85
SECTION 5.35. Commercial Tort Claims...................................................... 85
SECTION 5.36. Senior Note Purchase Agreements............................................. 85
SECTION 5.37. Other Restrictive Agreements................................................ 85
ARTICLE 6 DEFAULTS............................................................................ 85
SECTION 6.01. Events of Default........................................................... 85
SECTION 6.02. Notice of Default........................................................... 89
SECTION 6.03. Remedies with Respect to Collateral......................................... 89
SECTION 6.04. Power of Attorney........................................................... 90
ARTICLE 7 THE AGENT AND THE LENDERS........................................................... 91
SECTION 7.01. Appointment; Powers and Immunities.......................................... 91
SECTION 7.02. Reliance by Agent........................................................... 92
SECTION 7.03. Defaults.................................................................... 92
SECTION 7.04. Rights of Agent and its Affiliates as a Lender.............................. 93
SECTION 7.05. Indemnification............................................................. 93
SECTION 7.06. Payee of Note Treated as Owner.............................................. 93
SECTION 7.07. Nonreliance on Agent and Other Lenders...................................... 94
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SECTION 7.08. Failure to Act.............................................................. 94
SECTION 7.09. Resignation of Agent........................................................ 94
SECTION 7.10. Joinder of Lenders.......................................................... 94
SECTION 7.11. Agreements Regarding Collateral............................................. 95
SECTION 7.12. Agent Field Examinations; Appraisals........................................ 95
SECTION 7.13. Designation of Co-Agent..................................................... 96
SECTION 7.14. Replacement of Certain Lenders.............................................. 96
ARTICLE 8 CHANGE IN CIRCUMSTANCES; COMPENSATION............................................... 96
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair.................... 96
SECTION 8.02. Illegality.................................................................. 97
SECTION 8.03. Increased Cost and Reduced Return........................................... 98
SECTION 8.04. Base Rate Loans or Other Euro-Dollar Loans
Substituted for Euro-Dollar Loans........................................... 99
SECTION 8.05. Compensation................................................................ 99
SECTION 8.06. Failure to Pay in Foreign Currency.......................................... 100
SECTION 8.07. Judgment Currency........................................................... 100
ARTICLE 9 CONDITIONS TO BORROWINGS AND ISSUANCE OF LETTERS OF CREDIT.......................... 100
SECTION 9.01. Conditions to Initial Borrowing and issuance of any Letter of Credit........ 101
SECTION 9.02. Conditions to All Borrowings and Issuances of Letters of Credit............. 103
ARTICLE 10 MISCELLANEOUS....................................................................... 104
SECTION 10.01. Notices..................................................................... 104
SECTION 10.02. No Waivers.................................................................. 104
SECTION 10.03. Expenses; Documentary Taxes................................................. 105
SECTION 10.04. Indemnification............................................................. 105
SECTION 10.05. Setoff; Sharing of Setoffs.................................................. 105
SECTION 10.06. Amendments and Waivers...................................................... 107
SECTION 10.07. No Margin Stock Collateral.................................................. 108
SECTION 10.08. Successors and Assigns...................................................... 108
SECTION 10.09. Confidentiality............................................................. 111
SECTION 10.10. Representation by Lenders................................................... 111
SECTION 10.11. Obligations Several......................................................... 111
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SECTION 10.12. New York Law................................................................ 111
SECTION 10.13. Severability................................................................ 111
SECTION 10.14. Interest.................................................................... 112
SECTION 10.15. Interpretation.............................................................. 112
SECTION 10.16. WAIVER OF JURY TRIAL; CONSENT TO JURISDICTION............................... 113
SECTION 10.17. Counterparts................................................................ 113
SECTION 10.18. Source of Funds -- ERISA.................................................... 113
SECTION 10.19. Credit Inquiries............................................................ 113
SECTION 10.20. Consequential Damages....................................................... 113
SECTION 10.21. Entire Agreement............................................................ 113
SECTION 10.22. Continuing Agreement....................................................... 114
EXHIBITS:
EXHIBIT A-1 - Form of Revolving Loan Note
EXHIBIT A-2 Form of Settlement Loan Note
EXHIBIT B-1 - Form of General Counsel Opinion
EXHIBIT B-2 - Form of Borrower's Outside Counsel Opinion
EXHIBIT C - Form of Agent's Opinion
EXHIBIT D - Form of Assignment and Acceptance
EXHIBIT E-1 - Form of Notice of Borrowing
EXHIBIT E-2 Form of Notice of Continuation or Conversion
EXHIBIT F - Form of Borrowing Base Certificate
EXHIBIT G - Form of Compliance Certificate
EXHIBIT H - Form of Closing Certificate
EXHIBIT I - Form of Officer's Certificate
EXHIBIT J - Form of Waiver Agreement
EXHIBIT K - Form of Instruction Letter
EXHIBIT L - Form of Contribution Agreement
EXHIBIT M - Collateral Disclosure Certificate
EXHIBIT N - Form of Pledge Agreement
EXHIBIT P-1 - Form of Letter of Credit Request
EXHIBIT P-2 - Form of Notice of Letter of Credit
EXHIBIT Q - Form of Deposit Account Control Agreement
EXHIBIT R - Form of Securities Account Control Agreement
EXHIBIT S Form of Guaranty
EXHIBIT T Form of Joinder Agreement
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SCHEDULES:
SCHEDULE 1.01 - Other Material Subsidiaries
SCHEDULE 2.16 - Existing Letters of Credit
SCHEDULE 3.01 - Certain Permitted Encumbrances
SCHEDULE 4.01 - Qualification Jurisdictions
SCHEDULE 4.04 - Material Adverse Effect
SCHEDULE 4.05 - Litigation
SCHEDULE 4.13 - Environmental Matters
SCHEDULE 4.20 - Labor Disputes
SCHEDULE 4.21 - Surety Obligations
SCHEDULE 4.22 - Burdensome Restrictions
SCHEDULE 4.23 - Leases
SCHEDULE 4.25 - Capital Structure
SCHEDULE 4.33 - Intellectual Property Matters
SCHEDULE 5.01(c) - Consolidating Financial Information
SCHEDULE 5.14 - Affiliate Transactions
SCHEDULE 5.20 - Intercompany Debt, Other Debt
vii
CREDIT AND SECURITY AGREEMENT
THIS CREDIT AND SECURITY AGREEMENT dated as of October 9,
2003, is made by and among XXXXXX INC., BELDEN TECHNOLOGIES, INC., BELDEN
COMMUNICATIONS COMPANY, XXXXXX WIRE & CABLE COMPANY, the Lenders listed on the
signature pages hereof, WACHOVIA BANK, NATIONAL ASSOCIATION, as a Lender and as
Agent and U.S. BANK NATIONAL ASSOCIATION, as Syndication Agent.
The parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. Definitions. The terms as defined in this
SECTION 1.01 shall, for all purposes of this Agreement and any amendment hereto
(except as herein otherwise expressly provided), have the meanings set forth
herein:
"Accounts" means all "accounts" as such term is defined in the
UCC and, in any event, includes, without limitation, all accounts receivable,
other receivables, and all other rights to payment for property sold, leased,
licensed, assigned or otherwise disposed of, for a policy of insurance issued or
to be issued, for a secondary obligation incurred or to be incurred, for energy
provided or to be provided, for the use or hire of a vessel under a charter or
other contract, arising out of the use of a credit card or charge card, or for
services rendered or to be rendered or in connection with any other transaction
(whether or not yet earned by performance), all rights in, to, and under all
purchase orders or receipts for goods or services, all rights to any goods
represented by any of the foregoing, including, without limitation, all rights
of rescission, replevin, reclamation, and stoppage in transit and rights to
returned, reclaimed, or repossessed goods, all books, records, computer tapes,
programs and ledger books arising therefrom or relating thereto, all collateral
security of any kind, given by any Account Debtor or any other Person with
respect to any of the foregoing, all whether now owned or existing or hereafter
acquired or arising, by or in favor of, any Borrower or any Guarantor.
"Account Debtor" means the Person who is obligated on any
Account, Chattel Paper, or General Intangible.
"Adjusted London Interbank Offered Rate" means a rate per
annum equal to the quotient obtained (rounded upwards, if necessary, to the next
higher 1/100th of 1%) by dividing (i) the applicable London Interbank Offered
Rate for such Interest Period by (ii) 1.00 minus the Euro-Dollar Reserve
Percentage.
"Affected Lender" has the meaning set forth in SECTION 7.14.
"Affiliate" of any relevant Person means (a) any Person that
directly, or indirectly through one or more intermediaries, controls the
relevant Person (a "Controlling Person"), (b) any Person (other than the
relevant Person or a Subsidiary of the relevant Person) which is controlled by
or is under common control with a Controlling Person, or (c) any Person (other
1
than a Subsidiary of the relevant Person) of which the relevant Person owns,
directly or indirectly, 15% or more of the common stock or equivalent equity
interests. As used herein, the term "control" means possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of a Person, whether through the ownership of voting securities, by
contract or otherwise.
"Agent" means Wachovia Bank, National Association, a national
banking association organized under the laws of the United States of America, in
its capacity as administrative agent and collateral agent for the Lenders
hereunder, and its successors and permitted assigns in such capacity.
"Aggregate Commitments" means the sum of all the Commitments,
which, as of the Closing Date equals Seventy Five Million and No/100 Dollars
($75,000,000).
"Aggregate Real Properties" means the Real Properties and any
other real property operated by a Borrower or a Guarantor.
"Agreement" means this Credit and Security Agreement, together
with all amendments and supplements hereto.
"Amortizing Equipment Availability Amount" means from and
after the Appraisal Approval Date an amount equal to the lesser of (a) 85% of
the net orderly liquidation value of the eligible Equipment as determined by an
appraisal firm selected by the Agent on the Appraisal Approval Date and (b)
$20,000,000; provided that the Amortizing Equipment Availability Amount shall be
reduced from the initial Amortizing Equipment Availability Amount in effect on
the Appraisal Approval Date as set forth below on the last day of each
successive month after the Appraisal Approval Date, on a five (5) year schedule
of level monthly amortization, and further provided that upon any sale or
material decline in value, as determined by the Agent based upon a new
appraisal, of any asset included in the calculation of such value, the
Amortizing Equipment Availability Amount shall be reduced by the amount of such
sold asset that was included in such calculation, or by the amount of such
decline in value, as applicable.
"Applicable Margin" means:
(i) for the period commencing on the Closing
Date to and including the first Performance Pricing
Determination Date, (A) for any Base Rate Loan, .50%, and (B)
for any Euro-Dollar Loan, 2.25%; and
(ii) from and after the first Performance Pricing
Determination Date, for any Base Rate Loan and Euro-Dollar
Loan the percentage determined on each Performance Pricing
Determination Date by reference to the table set forth below
as to each such type of Loan and the Test Ratio as determined
as of the end of the Fiscal Quarter ending immediately prior
to such Performance Pricing Determination Date.
2
Applicable
Applicable Margin Margin for
for Base Rate Euro-Dollar
Test Ratio Loans Loans
---------- ----- -----
LEVEL I
If the Test Ratio is equal to or 1.50% 3.25%
greater than 4.00
LEVEL II
If the Test Ratio is less than 4.00 1.00% 2.75%
but is equal to or greater than 3.00
LEVEL III
If the Test Ratio is less than 3.00 0.50% 2.25%
but is equal to or greater than 2.00
LEVEL IV
If the Test Ratio is less than 2.00 0.00% 1.75%
The Applicable Margin shall be subject to adjustment as provided in SECTION
2.06(a).
"Appraisal Approval Date" means the date upon which the Agent
in its sole discretion approves the equipment appraisal which may be submitted
by Borrowers to Agent at any time which is (i) after the payment by Parent of
the $64,000,000 Senior Notes Series A which are due on September 1, 2004
pursuant to the 1999 Senior Note Purchase Agreement; and (ii) within twenty-four
(24) months of the Closing Date.
"Approved Depositary" means either (a) the Agent or a Lender,
or (b) another depositary bank upon the execution and delivery by the Agent and
such other depositary bank and the relevant Borrower or Guarantor of a Deposit
Account Control Agreement.
"Approved Securities Intermediary" means either (a) the Agent
or a Lender, or (b) another depositary bank upon the execution and delivery by
the Agent and such other depositary bank and the relevant Borrower of a
Securities Account Control Agreement.
"Arranger" means Wachovia Capital Markets, LLC.
"Assignee" has the meaning set forth in SECTION 10.08(c).
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"Assignment and Acceptance" means an Assignment and Acceptance
executed in accordance with SECTION 10.08(c) in the form of EXHIBIT D.
"Assignment of Claims Act" means the Assignment of Claims Act
of 1940 (31 USC SECTION 3727 and 41 USC SECTION 15), as it may be amended from
time to time.
"Authority" has the meaning set forth in SECTION 8.02.
"Bankruptcy Code" means Title 11 of the United States Code, as
it may be amended from time to time.
"Base Rate" means for any Base Rate Loan for any day, the rate
per annum equal to the higher as of such day of (a) the Prime Rate, or (b)
one-half of one percent above the Federal Funds Rate. For purposes of
determining the Base Rate for any day, changes in the Prime Rate or the Federal
Funds Rate shall be effective on the date of each such change.
"Base Rate Loan" means a Loan which bears or is to bear
interest at a rate based upon the Base Rate, and is to be made as a Base Rate
Loan pursuant to the applicable Notice of Borrowing, Notice of Continuation or
Conversion, SECTION 2.02(f), or ARTICLE 8, as applicable.
"Borrowers" means, individually and collectively, as the
context requires, each of the following Persons, each of them being jointly and
severally obligated as Borrowers hereunder: (a) Xxxxxx Inc., Belden
Technologies, Inc., Belden Communications Company and Xxxxxx Wire & Cable
Company; and (b) in the case of each Borrower, its successors and its permitted
assigns.
"Borrowing" means a borrowing hereunder consisting of Loans
and Refunding Loans made to the Borrowers (a) at the same time by all of the
Lenders, in the case of a Revolving Loan Borrowing, or (b) separately by
Wachovia, in the case of a Settlement Loan Borrowing, in each case pursuant to
ARTICLE 2. A Borrowing is a "Revolving Loan Borrowing" if such Loans are
Revolving Loans, a "Settlement Loan Borrowing" if such Loans are Settlement
Loans, a "Syndicated Borrowing" if such Loans are Syndicated Loans, a
"Euro-Dollar Borrowing" if such Loans are Euro-Dollar Loans, and a "Base Rate
Borrowing" if such Loans are Base Rate Loans.
"Borrowing Base" means the following sum:
(a) an amount equal to 85% of the face dollar value of
Eligible Accounts as of the date of determination;
PLUS
(b)
(i) an amount equal to 40% of the dollar value
of the Eligible Inventory consisting of
finished goods, valued at the lower of cost
4
(on a first-in, first- out basis) or market
value as at the date of determination;
plus
(ii) an amount equal to 50% of the face dollar
value of the Eligible Inventory consisting
of its raw materials, valued at the lower of
cost (on a first-in, first-out basis) or
market value as of the date of
determination;
PLUS
(c) Amortizing Equipment Availability Amount, if any;
MINUS
(d) a reserve in the amount of the Current Derivative
Exposure;
MINUS
(e) such other reserves as the Agent may in its
commercially reasonable judgment, or at the direction
of the Required Lenders in their commercially
reasonable judgment will, establish from time to time
by written notice to the Parent and the Lenders.
"Borrowing Base Certificate" means a certificate in the form
of EXHIBIT F.
"Capital Stock" means any Equity Interest other than
Redeemable Preferred Stock of the Parent or any Subsidiary (to the extent issued
to a Person other than any Borrower, Guarantor, or any other Subsidiary),
whether common or preferred.
"Casualty" means any act or occurrence of any kind or nature
that results in damage, loss or destruction to the Collateral.
"CERCLA" means the Comprehensive Environmental Response
Compensation and Liability Act, 42 U.S.C. Section 9601 et. seq. and its
implementing regulations and amendments.
"CERCLIS" means the Comprehensive Environmental Response
Compensation and Liability Inventory System established pursuant to CERCLA.
"Certified Public Accountants" means the Parent's independent
certified public accountants as of the Closing Date and such other firm or firms
of nationally recognized independent certified public accountants which may be
retained by the Parent thereafter for the purpose of auditing its financial
statements.
"Change of Law" shall have the meaning set forth in SECTION
8.02.
5
"Chattel Paper" means "chattel paper" as such term is defined
in the UCC, and includes, without limitation, Electronic Chattel Paper, all
whether now owned or existing or hereafter acquired or arising, by or in favor
of, any Borrower or Guarantor.
"Closing Certificate" has the meaning set forth in SECTION
9.01(e).
"Closing Date" means October 9, 2003.
"Code" means the Internal Revenue Code of 1986, as amended, or
any successor Federal tax code.
"Collateral" means (a) the personal property in which the
Agent, for the benefit of the Lenders, is granted a security interest pursuant
to SECTION 3.01 and (b) the Pledged Stock pledged to the Agent pursuant to the
Pledge Agreement.
"Collateral Disclosure Certificates" means, individually or
collectively, as the context shall require, the Collateral Disclosure
Certificates dated as of even date herewith, substantially in the form of
EXHIBIT M, executed by each of the Borrowers and the Guarantors and containing
disclosure of information pertaining to the Collateral.
"Collateral Locations" means the respective Executive Office
of each Borrower and each Guarantor and those additional locations, if any, of
each Borrower and Guarantor set forth and described in the Collateral Disclosure
Certificates or disclosed in writing to the Agent by the Borrowers as required
in SECTION 5.22.
"Collateral Reserve Account" means each Deposit Account (a)
over which the Agent has control by virtue of such Deposit Account's being
maintained with the Agent or other Approved Depositary and (b) which Borrowers
or Guarantors are or may be required to open and maintain with the Agent
pursuant to the requirements of SECTION 2.15.
"Commercial Tort Claims" means each of the Borrowers' and each
Guarantors' "commercial tort claims" as such term is defined in the UCC, and
includes, without limitation, those commercial tort claims described in the
Collateral Disclosure Certificates, if any, and all other commercial tort claims
with respect to which any Borrower or Guarantor has given the Agent notice in
accordance with SECTION 5.35.
"Commitment" means (a) as of the Closing Date, with respect to
Wachovia $25,000,000; U.S. Bank National Association, $22,500,000; Comerica
Bank, $7,500,000; The Northern Trust Company, $7,500,000; ING Bank N.V.,
$7,500,000; and Fifth Third Bank, Indiana, $5,000,000; and (b) as to any Lender
which enters into any Assignment and Acceptance (whether as transferor Lender or
as Assignee thereunder), the amount of such Lender's Commitment after giving
effect to such Assignment and Acceptance, in each case as such amount may be
reduced from time to time pursuant to SECTIONS 2.08 and 2.09.
"Commitment Percentage" means, for each Lender, the percentage
equal to its Commitment divided by the Aggregate Commitments.
"Compliance Certificate" means a certificate in the form of
EXHIBIT G.
6
"Condemnation" means any taking of title, of use, or of any
other property interest under the exercise of the power of eminent domain,
whether temporarily or permanently, by any governmental authority or by any
Person acting under governmental authority.
"Condemnation Awards" means any and all judgments, awards of
damages (including, but not limited to, severance and consequential damages),
payments, proceeds, settlements, amounts paid for a taking in lieu of
Condemnation, or other compensation heretofore or hereafter made, including
interest thereon, and the right to receive the same, as a result of, or in
connection with, any Condemnation or threatened Condemnation.
"Consolidated Cash Taxes" means, for the relevant fiscal
period, calculated on a consolidated basis in accordance with GAAP for the
Parent and its Consolidated Subsidiaries, the aggregate of all taxes, to the
extent they are paid in cash during such fiscal period.
"Consolidated EBITDA" means the sum of the following,
calculated on a consolidated basis in accordance with GAAP for the Parent and
its Consolidated Subsidiaries, for the relevant fiscal period: (a) Consolidated
Operating Income; plus (b) depreciation and amortization expenses; plus (c)
non-cash charges as determined by the Agent.
"Consolidated Fixed Charges" means the sum of the following,
calculated on a consolidated basis in accordance with GAAP for the Parent and
its Consolidated Subsidiaries in each case calculated for the 4 Fiscal Quarters
or 12 Fiscal Months just ended prior to the date of such calculation: (a)
Consolidated Net Interest Expense, plus (b) principal of long term Debt
(excluding the payment by Parent of the $64,000,000 Senior Notes Series A which
are due on September 1, 2004) paid or payable in cash as reflected on the
Parent's and its Consolidated Subsidiaries' most recent monthly financial
statements submitted to the Lenders pursuant to SECTION 5.01(b), plus (c) the
aggregate amount of all Restricted Payments (other than those of the type
described in subsections (a) and (b) of the definition of Restricted Payments)
paid, plus (d) the amount of any reductions in the Amortizing Equipment
Availability Amount pursuant to the definition thereof.
"Consolidated Funded Debt" means, on any date of measurement,
the Funded Debt of the Parent and its Consolidated Subsidiaries, determined on a
consolidated basis in accordance with GAAP.
"Consolidated Net Interest Expense" for any relevant fiscal
period means interest payable in cash in respect of Debt of the Parent or any of
its Consolidated Subsidiaries outstanding during such period, determined on a
consolidated basis in accordance with GAAP.
"Consolidated Operating Income" means, for any relevant fiscal
period, the Operating Income of the Parent and its Consolidated Subsidiaries for
such period, determined on a consolidated basis, but excluding extraordinary
items.
"Consolidated Subsidiary" means at any date any Subsidiary or
other entity the accounts of which, in accordance with GAAP, would be
consolidated with those of the Parent in its consolidated financial statements
as of such date.
7
"Consolidated Tangible Net Worth" means, as of any date of
determination, Stockholders' Equity, less the sum of the value as of such date,
as set forth or reflected on the most recent consolidated balance sheet of the
Parent and its Consolidated Subsidiaries, prepared in accordance with GAAP, of:
(a) Any surplus resulting from any write-up of assets
subsequent to December 31, 2002;
(b) All assets which would be treated as intangible
assets for balance sheet presentation purposes under GAAP, including without
limitation goodwill (whether representing the excess of cost over book value of
assets acquired, or otherwise), trademarks, tradenames, copyrights, patents and
technologies, and unamortized debt discount and expense, and unamortized capital
startup costs;
(c) To the extent not included in (b) of this definition,
any amount at which shares of Capital Stock of the Parent appear as an asset on
the balance sheet of the Parent and its Consolidated Subsidiaries;
(d) Loans or advances to stockholders, directors,
officers or employees;
(e) To the extent not included in (b) of this definition,
deferred expenses (not including deferred taxes); and
(f) Affiliate and shareholder loans of the Parent and its
Consolidated Subsidiaries.
"Contribution Agreement" means the Contribution Agreement of
even date herewith in substantially the form of EXHIBIT L to be executed by each
of the Borrowers and each Guarantor.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrowers, are treated as a single
employer under Section 414 of the Code.
"Xxxxxx Tax Sharing Agreement" means that certain Tax Sharing
and Separation Agreement dated September 30, 1993 between Borrowers and Xxxxxx
Industries, Inc., as amended or supplemented from time to time.
"Copyrights" means all of the following types of property of
the Borrowers and the Guarantors: (a) all copyrights arising under the laws of
the United States, any other country or any political subdivision thereof,
whether registered or unregistered and whether published or unpublished
(including, without limitation, those listed in the Collateral Disclosure
Certificates), all registrations and recordings thereof, and all applications in
connection therewith, including, without limitation, all registrations,
recordings and applications in the United States Copyright Office, and (b) the
right to obtain all renewals thereof.
"Copyright Licenses" means all written agreements naming a
Borrower or Guarantor as licensor or licensee (including, without limitation,
those listed in the Collateral
8
Information Certificates), granting any right under any Copyright, including,
without limitation, the grant of rights in all derivative works based upon any
Copyright, and all renewals and extensions thereof.
"Credit Documents" means this Agreement, the Notes, the
Contribution Agreement, the Guaranty, the Security Documents, the Collateral
Disclosure Certificates, any other agreement or document executed by the
Borrowers or the Guarantors evidencing, relating to or securing the Obligations
of the types described in clauses (a) and (b) of the definition thereof, and any
other agreement, document or instrument executed by the Borrowers or the
Guarantors and delivered from time to time in connection with this Agreement,
the Notes, the Contribution Agreement, the Guaranty, the Security Documents or
the Obligations of the types described in clauses (a) and (b) of the definition
thereof, as such documents and instruments may be amended or supplemented from
time to time.
"Current Derivative Exposure" means, as of any date of
determination, 100% of the aggregate xxxx-to-market exposure then owing by the
Borrower or any Guarantor under Interest Rate Protection Agreements, as
calculated by the Agent on a monthly basis (or more frequently, in the
discretion of the Agent).
"Debt" of any Person means at any date, without duplication,
(a) all obligations of such Person for borrowed money, (b) all payment
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments, (c) all obligations of such Person to pay the deferred
purchase price of property or services, except trade accounts payable and
accrued expenses arising in the ordinary course of business, (d) all obligations
of such Person as lessee under capital leases or leases for which such Person
retains tax ownership of the property subject to a lease (and where such lease
is considered borrowed money indebtedness for tax purposes but is classified as
an operating lease under GAAP), (e) all obligations of such Person to reimburse
any bank or other Person in respect of amounts payable under a banker's
acceptance, (f) all Redeemable Preferred Stock of such Person (in the event such
Person is a corporation), (g) all obligations of such Person to reimburse any
bank or other Person in respect of amounts paid or undrawn amounts available to
be paid under a letter of credit or similar instrument, (h) all Debt of others
secured by a Lien on any asset of such Person, whether or not such Debt is
assumed by such Person, (i) all obligations of such Person with respect to
interest rate protection agreements, foreign currency exchange agreements or
other hedging arrangements, other than commodity hedging agreements entered into
by such Person as risk protection rather than as an investment (each valued as
the termination value thereof computed in accordance with a method approved by
the International Swap Dealers Association and agreed to by such Person in the
applicable agreement, if any), and (j) all Debt of others Guaranteed by such
Person.
"Default" means any condition or event which constitutes an
Event of Default or which with the giving of notice or lapse of time or both
would, unless cured or waived, become an Event of Default.
"Default Rate" means, with respect to any of the Obligations,
on any day, the sum of (a) the applicable Interest Rate Basis, plus (b) the
highest Applicable Margin, plus (c) two percent (2%).
9
"Deposit Account" means "deposit account" as defined in the
UCC or the Uniform Commercial Code of any applicable jurisdiction, but only to
the extent such deposit account is located in the United States of America, and,
in any event, includes, without limitation, any demand, time, savings, passbook
or like account maintained with a depositary institution in the United States of
America and all funds from time to time credited to any account referred to in
this definition. Notwithstanding any provision of this Agreement to the
contrary, Belden Wire & Cable Company's account maintained with Fleet Bank
having a maximum amount of $25,000 shall not be a Deposit Account and no Deposit
Account Control Agreement shall be required for such account.
"Deposit Account Control Agreement" means a Deposit Account
Control Agreement substantially in the form of EXHIBIT Q, with any changes as
may be acceptable to the Agent in its sole discretion, or a similar control
agreement in form and substance acceptable to the Agent, executed and delivered
by an Approved Depositary at which a Borrower or a Guarantor maintains a Deposit
Account.
"Dollar Equivalent" means the Dollar equivalent of the amount
of a foreign currency, determined by the Agent on the basis of its spot rate for
the purchase of the appropriate foreign currency with Dollars.
"Dollars" or "$" means dollars in lawful currency of the
United States of America.
"Documents" means "documents" as such term is defined in the
UCC, all whether now owned or existing or hereafter acquired or arising, by or
in favor of, any Borrower or Guarantor.
"Domestic Business Day" means any day except a Saturday,
Sunday or other day on which commercial banks in Charlotte, North Carolina, or
New York, New York, are authorized by law to close.
"Domestic Subsidiary" means any Subsidiary that is organized
under the laws of the United States of America or any state thereof, or the
District of Columbia.
"Echelon Accounts" means accounts that arise from sales by one
of the Borrowers to BB Communications Service Facility, LLC, a Delaware limited
liability company that does business under the name "Echelon", in which, with
respect to the associated Inventory sold, such Borrower (i) takes a purchase
money security interest in the product sold and the proceeds thereof, (ii)
timely causes to be filed a financing statement with the Secretary of State of
Delaware, showing BB Communications Service Facility, LLC as the debtor, such
Borrower as the secured party, and the Agent as assignee of the secured party,
and (iii) satisfies all other conditions set forth in Section 9-324 of the
applicable Uniform Commercial Code to obtain priority over any other conflicting
security interests.
"Electronic Chattel Paper" means "electronic chattel paper" as
such term is defined in the UCC, all whether now existing or owned or hereafter
acquired or arising, by or in favor of, any Borrower or Guarantor.
10
"Eligible Accounts" means that portion of each Borrower's and
Guarantor's Accounts consisting of trade accounts receivable (as reported on the
general ledger and then reconciled to the aging report described in SECTION
5.27(a)) actually owing to such Borrower or Guarantor by its Account Debtors
subject to no counterclaim, defense, dispute, setoff, retainage or deduction
(including, without limitation, chargebacks, accrued customer rebates and other
non-cash credits), provided, in each of the foregoing cases, that each such
Account is at all times subject to a duly perfected, first priority security
interest in favor of Agent, subject only to any Permitted Encumbrances
excluding, however, in any event any such Account:
(i) more than 90 days past invoice date or more
than 60 days past due date (or in either case, such lesser
number of days which the Agent may establish by written notice
from time to time to the Borrowers in its commercially
reasonable judgment);
(ii) which is owing by any Subsidiary or other
Affiliate or any employee thereof, provided, that the
eligibility requirement set forth in this clause (ii) shall
not apply to Echelon Accounts;
(iii) which is owing by any Account Debtor having
50% or more in face value of its then existing Accounts with
such Borrower or Guarantor ineligible under clause (i) above;
(iv) the assignment of which is subject to any
requirements set forth in the Assignment of Claims Act, unless
the Borrower or the relevant Guarantor, as applicable, duly
assigns its rights to payment thereof to the Agent pursuant to
the Assignment of Claims Act;
(v) which is owing by any Account Debtor whose
Accounts, in face amount, with such Borrower or Guarantor
exceed 15% (or 20% as to Anixter Inc. and its Affiliates, KMM
Telecommunications and the Echelon Accounts) (or in each case
such lesser percentage which the Agent may establish by
written notice from time to time to the Borrowers in its
commercially reasonable judgment) of such Borrower's or
Guarantor's Eligible Accounts, but only to the extent of such
excess;
(vi) which arises from a sale to an Account
Debtor with its principal office, assets or place of business
outside the United States or any province in Canada (other
than Quebec) provided that the Canadian receivables are billed
and collected by a Borrower or Guarantor, unless the sale is
backed by an irrevocable letter of credit (a) which is issued
or confirmed by a bank acceptable to the Agent, (b) which is
in form and substance acceptable to the Agent, (c) which is
payable in the full amount of such Account, (d) which is
freely convertible into Dollars at a place of payment within
the United States, and, (e) if requested by the Agent, over
which the Agent has control;
11
(vii) which arises from (a) the sale of goods
which have not been delivered (a "xxxx and hold" arrangement),
or (b) services which have not been performed by such Borrower
or Guarantor and accepted by the Account Debtor;
(viii) which is owing by any Account Debtor which
is the subject (as debtor) of any voluntary or involuntary
case or proceeding under any bankruptcy, insolvency or other
similar law or as to which a trustee, receiver, liquidator,
custodian or other similar official has been appointed for it
or for any substantial part of its property;
(ix) which arises from the sale of any Inventory
that is not Eligible Inventory pursuant to clause (iii) of the
proviso contained in the definition of "Eligible Inventory";
(x) with respect to which the Agent determines
in its commercially reasonable judgment that collection of
such Account is insecure, or that payment thereof is doubtful
or will be materially delayed by reason of such Account
Debtor's financial condition or that the prospect of payment
or performance by such Account Debtor is or will be materially
impaired;
(xi) with respect to which the Account Debtor's
executive offices are located in the State of New Jersey,
Indiana or any other state imposing similar conditions to the
right of a creditor to collect Accounts, unless (a) such
Borrower or Guarantor has filed a notice of business
activities report, or such other similar report required by
such state, with the appropriate officials of such state for
the then current year or such Borrower or Guarantor is
qualified to do business in such state, or (b) such Account
Debtor has substantial assets located, respectively, outside
of the States of New Jersey, Indiana or such other state, as
the case may be;
(xii) which is owed by, billed to, or will be paid
by an Account Debtor located in the State of Alabama or any
other state in which the Borrowers or Guarantors are aware
that the laws of such state deny creditors access to its
courts in the absence of qualification to do business as a
foreign corporation in such state or in the absence of the
filing of any required reports with such state, unless such
Borrower or Guarantor has qualified as a foreign corporation
authorized to do business in Alabama or such state or has
filed such required reports;
(xiii) which is subject to any Lien other than a
Permitted Encumbrance;
(xiv) which consists of "xxxxxxxx over cost"
(items which have been invoiced but for which costs incurred
in connection therewith have not been recognized);
(xv) which is owing by any Account Debtor with
respect to which any Borrower or Guarantor has determined for
any reason not to continue selling goods to or performing
services for on open account;
12
(xvi) which is evidenced by Chattel Paper or an
Instrument of any kind, or has been reduced to judgment;
(xvii) with respect to which such Borrower or
Guarantor has made an agreement with the Account Debtor (a)
for any deduction therefrom, except for discounts or
allowances which are made in the ordinary course of business
for prompt payment and which discounts or allowances are
reflected in the calculation of the face amount of each
invoice related to such Account, but only to the extent of
such deduction, or (b) to extend the time of payment thereof
beyond the period set forth in clause (i) in this definition;
(xviii) which arises from a retail sale of goods to
a Person who is purchasing the same primarily for personal,
family or household purposes;
(xix) which represents a progress billing or
percentage of completion arrangement (unless the Agent, in the
exercise of its sole discretion, after the Borrower's request,
permits the same to not be excluded hereunder) or a retainage;
(xx) to the extent that such Account includes any
tax due to any governmental taxing authority, the amount of
such tax; or
(xxi) which has otherwise been determined by the
Agent in its commercially reasonable judgment not to be
eligible for purposes hereof, whether or not satisfying the
criteria set forth above, as such criteria may be modified by
the Agent in its commercially reasonable judgment upon notice
to the Borrower.
"Eligible Inventory" means the gross dollar value of Inventory
(as reported on the general ledger and then reconciled to the inventory report
described in SECTION 5.27(d)) of each Borrower and Guarantor consisting of: (a)
raw materials; and (b) finished goods, subject to no further processing and held
for sale in the ordinary course of business to customers and not Affiliates of
the Borrowers; provided, in each of the foregoing cases, that such Inventory:
(i) is at all times subject to a duly perfected,
first priority security interest in favor of Agent, subject
only to any Permitted Encumbrances;
(ii) is in good and saleable condition;
(iii) is not on consignment from or subject to any
guaranteed sale, sale-or-return, sale-or-approval, or
repurchase agreement with any supplier;
(iv) does not constitute in-transit goods (except
for in-transit goods which are being carried on vehicles owned
or leased by a Borrower);
(v) does not constitute packaging, scrap, tools,
supplies, work-in-process or obsolete, repossessed, damaged or
slow-moving (more than 12 months since most recent sale of an
item) goods or (without duplication) goods which have been
reserved for by the Borrowers or Guarantors as "slow-moving
goods";
13
(vi) conforms in all material respects to the
warranties and representations with respect to Inventory set
forth herein;
(vii) is not subject to a negotiable document of
title (unless issued or endorsed, and delivered to Agent);
(viii) is not subject to any license or other
agreement that limits or restricts such Borrower's,
Guarantor's or the Agent's right to sell or otherwise dispose
of such Inventory;
(ix) is located in the United States on premises
owned by such Borrower or Guarantor or with respect to which
the Agent holds a Waiver Agreement and is a Collateral
Location;
(x) meets all standards imposed by any
governmental authority;
(xi) does not constitute special order goods not
covered by a firm purchase order; and
(xii) which has not otherwise been determined by
the Agent in its commercially reasonable judgment to be
ineligible for purposes hereof, whether or not satisfying the
criteria set forth above, as such criteria may be modified by
the Agent in its commercially reasonable judgment upon notice
to the Parent.
"Environmental Authority" means any foreign, federal, state,
local or regional government that exercises any form of jurisdiction or
authority under any Environmental Requirement.
"Environmental Authorizations" means all licenses, permits,
orders, approvals, notices, registrations or other legal prerequisites for
conducting the business of the Parent or any Subsidiary required by any
Environmental Requirement.
"Environmental Judgments and Orders" means (i) all judgments,
decrees or orders arising from any Environmental Requirements (whether or not
entered upon consent), or (ii) written agreements with an Environmental
Authority arising from any Environmental Requirement (whether or not
incorporated in a judgment, decree or order).
"Environmental Liabilities" means any liabilities, whether
accrued or contingent, arising from any Environmental Requirement.
"Environmental Notices" means notices from any Environmental
Authority of possible or alleged noncompliance with or liability under any
Environmental Requirement, including without limitation any complaints,
citations, demands or requests from any Environmental Authority for correction
of any violation of any Environmental Requirement or any investigations of an
Environmental Authority concerning any violation of any Environmental
Requirement.
14
"Environmental Proceedings" means any judicial or
administrative proceedings arising from any Environmental Requirement.
"Environmental Releases" means releases as defined in CERCLA
or under any applicable state or local environmental law or regulation.
"Environmental Requirement" means any health, safety or
environmental law or regulation applicable to any Borrower or Guarantor with
respect to its US operations or the Real Properties, including but not limited
to any such requirement under CERCLA or similar state law and all federal, state
and local laws, ordinances, regulations, orders, writs, decrees and common law
relating to health or the environment.
"Equipment" means all "equipment," as such term is defined in
the UCC, wherever located but only to the extent located in the United States
and, in any event, includes, without limitation, all machinery and equipment,
including, without limitation, all processing equipment, conveyors, machine
tools, data processing and computer equipment, including, without limitation,
all embedded software and peripheral equipment and all engineering, processing
and manufacturing equipment, office machinery, furniture, materials handling
equipment, tools, attachments, accessories, automotive equipment, trailers,
trucks, forklifts, molds, dies, stamps, rolling stock and other equipment of
every kind and nature (which do not constitute titled vehicles), trade fixtures
and fixtures not forming a part of real property, together with all additions
and accessions thereto, replacements therefor, all parts therefor, all
substitutes for any of the foregoing, fuel therefor, and all manuals, drawings,
instructions, warranties and rights with respect thereto, and all products and
proceeds thereof and condemnation awards and insurance proceeds with respect
thereto, all whether now owned or existing or hereafter acquired or arising, by
or in favor of, any Borrower or Guarantor, but in any event only to the extent
located in the United States, and excluding all Excluded Equipment.
"Equity Interests" means, with respect to any Person, (a) all
shares, interests, participations, rights or other equivalents (however
designated, whether voting or non-voting) of or interests in corporate or
capital stock, including without limitation, shares of preferred or preference
stock, of such Person, (b) all partnership interests (whether general or
limited) of such Person, (c) all membership interests or limited liability
company interests in such Person, (d) all other equity or ownership interests in
such Person of any other type and (e) all warrants, rights or options to
purchase any of the foregoing.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, or any successor law. Any reference to any
provision of ERISA shall also be deemed to be a reference to any successor
provision or provisions thereof.
"Euro-Dollar Business Day" means any Domestic Business Day on
which dealings in Dollar deposits are carried out in the London interbank
market.
"Euro-Dollar Loan" means a Loan which bears or is to bear
interest at a rate based upon the Adjusted London Interbank Offered Rate, and to
be made as a Euro-Dollar Loan pursuant to a Notice of Borrowing or continued as
or converted to a Euro-Dollar Loan pursuant to a Notice of Continuation or
Conversion.
15
"Euro-Dollar Reserve Percentage" means for any day that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a member bank of
the Federal Reserve System in respect of "eurocurrency liabilities" (or in
respect of any other category of liabilities which includes deposits by
reference to which the interest rate on Euro-Dollar Loans is determined or any
category of extensions of credit or other assets which includes loans by a
non-United States office of any Lender to United States residents).
"Event of Default" has the meaning set forth in SECTION 6.01.
"Excess Borrowing Availability" means, at any time, the amount
(if any) by which the lesser of (i) the Aggregate Commitments and (ii) the
aggregate amount of the Borrowing Base exceeds the then outstanding Working
Capital Obligations.
"Excluded Equipment" means (a) any Equipment subject to a
Purchase Money Lien as to which the purchase money creditor holding such Lien
prohibits other Liens thereon without its prior consent, unless and until either
(i) such creditor grants such consent or (ii) the Debt secured by such Lien has
been fully paid and satisfied; (b) any Equipment with respect to which the
rights of possession and use of any Borrower or Guarantor are created pursuant
to a lease which does not create a security interest, unless and until such time
(if any) as such Borrower acquires title to such Equipment from the lessor or
the lessor abandons its rights and claims thereto; and (c) Vehicles.
"Executive Office" means the chief executive office address of
the Parent and each Borrower designated as such in the Collateral Disclosure
Certificates.
"Existing Letters of Credit" means those letters of credit
described in Schedule 2.16 that are in existence on the Closing Date but are
deemed to have been issued under this Agreement pursuant to SECTION 2.16.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the next higher 1/100th of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Domestic
Business Day next succeeding such day, provided that (a) if the day for which
such rate is to be determined is not a Domestic Business Day, the Federal Funds
Rate for such day shall be such rate on such transactions on the next preceding
Domestic Business Day as so published on the next succeeding Domestic Business
Day, and (b) if such rate is not so published for any day, the Federal Funds
Rate for such day shall be the average rate charged to the Agent on such day on
such transactions, as determined in good faith by the Agent.
"Fee Letter" means that certain letter agreement, dated as of
August 19, 2003 among the Borrowers, the Agent and the Arranger relating to
certain fees from time to time payable by the Borrowers to the Agent and the
Arranger, together with all amendments and supplements thereto.
"Fiscal Month" means any fiscal month of the Parent.
16
"Fiscal Quarter" means any fiscal quarter of the Parent.
"Fiscal Year" means any fiscal year of the Parent.
"Fixed Charge Coverage Ratio" means, as of any date of
determination, the ratio of (a) Consolidated EBITDA, less the aggregate amount
of all capital expenditures of the Parent and its Consolidated Subsidiaries,
less Consolidated Cash Taxes, less any amounts to be paid under the Xxxxxx Tax
Sharing Agreement, less amounts paid of the types described in subsection (a) of
the definition of Restricted Payments, in each case for the period of 12 Fiscal
Months ended on such date, to (b) Consolidated Fixed Charges.
"Foreign Subsidiary" means any Subsidiary that is not a
Domestic Subsidiary.
"ForEx Contract" means each "spot" or "forward" foreign
currency exchange agreement entered into from time to time between the Parent or
any Borrower and any Lender.
"ForEx Obligations" means any and all settlement obligations,
fees, charges, liabilities and other obligations owed to any Lender under all
ForEx Contracts.
"Funded Debt" for any Person means: (a) all Debt of such
Person and (b) all accounts payable of such Person which are more than 60 days
past due and not in dispute.
"GAAP" means generally accepted accounting principles in the
United States of America applied on a basis consistent with those which, in
accordance with SECTION 1.02, are to be used in making the calculations for
purposes of determining compliance with the terms of this Agreement.
"General Intangibles" means all of each Borrower's and
Guarantor's "general intangibles" as such term is defined in the UCC and, in any
event, includes, without limitation, (a) all tax refunds, claims for tax
refunds, and tax credits, (b) all permits, licenses, approvals, authorizations,
consents, variances, and certifications of any governmental authority, (c) all
claims, causes of action, and choses in action, (d) all property, casualty,
liability, and other insurance of any kind or character, and all insurance
claims and insurance refund claims, (e) all payment intangibles, (f) all lists,
books, records, recorded knowledge, ledgers, files (whether in printed form or
stored electronically), designs, blueprints, data, specifications, engineering
reports, manuals, computer records, computer programs and computer software
(including source codes), (g) all internet domain names and websites and related
licenses and agreements, (h) all Intellectual Property and (i) all contracts,
agreements, instruments and indentures in any form, and portions thereof, to
which any Borrower or Guarantor is a party or under which any Borrower or
Guarantor has any right, title or interest or to which any Borrower or Guarantor
or any property of any Borrower or Guarantor is subject, as the same may from
time to time be amended, supplemented or otherwise modified, including, without
limitation, (i) all rights of any Borrower or Guarantor to receive moneys due
and to become due to it thereunder or in connection therewith, (ii) all rights
of any Borrower or Guarantor to damages arising thereunder and (iii) all rights
of any Borrower or Guarantor to perform and to exercise all remedies thereunder;
but in any event excluding from this definition, rights under any contract,
agreement, instrument or indenture or under any Intellectual Property that by
the terms thereof, or under applicable law, cannot be assigned or a security
interest granted therein in the manner
17
contemplated by this Agreement unless consent from the relevant party or parties
has been obtained and under the terms of which any such assignment or grant of a
security interest therein in the absence of such consent would, or could, result
in the termination thereof, but only to the extent that (y) such rights are
subject to such contractual or legal restriction and (z) such restriction is
not, or could not be, rendered ineffective pursuant to the UCC of any relevant
jurisdiction or any other applicable law or principles of equity.
"Goods" means all "goods" as defined in the UCC, wherever
located but only to the extent located in the United States, including, without
limitation, embedded software to the extent included in "goods" as defined in
the Code, all whether now owned or existing or hereafter acquired or arising, by
or in favor of, any Borrower or Guarantor.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of such
Person (a) to secure, purchase or pay (or advance or supply funds for the
purchase or payment of) such Debt or other obligation (whether arising by virtue
of partnership arrangements, by agreement to keep-well, to purchase assets,
goods, securities or services, to provide collateral security, to take-or-pay,
or to maintain financial statement conditions or otherwise) or (b) entered into
for the purpose of assuring in any other manner the obligee of such Debt or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part), provided that the term Guarantee shall
not include endorsements for collection or deposit in the ordinary course of
business. The term "Guarantee" used as a verb has a corresponding meaning.
"Guarantors" means (i) the Initial Subsidiary Guarantors and
(ii) each other Domestic Subsidiary that becomes a Guarantor pursuant to SECTION
5.15.
"Guaranty" means the Guaranty, substantially in the form of
EXHIBIT S, to be executed by the Guarantors, unconditionally and jointly and
severally guaranteeing payment of the Loans, the Notes and all other Obligations
of the Borrowers to the Agent and the Lenders hereunder, including without
limitation all principal, interest, fees, costs, and compensation and
indemnification amounts provided for hereunder.
"Hazardous Materials" includes, without limitation, (a) solid
or hazardous waste, as defined in the Resource Conservation and Recovery Act of
1980, 42 U.S.C. Section 6901 et seq. and its implementing regulations and
amendments, or in any applicable state or local law or regulation, (b)
"hazardous substance", "pollutant", or "contaminant" as defined in CERCLA, or in
any applicable state or local law or regulation, (c) gasoline, or any other
petroleum product or by-product, including, crude oil or any fraction thereof,
(d) toxic substances, as defined in the Toxic Substances Control Act of 1976, or
in any applicable state or local law or regulation and (e) insecticides,
fungicides, or rodenticides, as defined in the Federal Insecticide, Fungicide,
and Rodenticide Act of 1975, or in any applicable state or local law or
regulation, as each such Act, statute or regulation may be amended from time to
time.
"Initial Subsidiary Guarantors" means Belden Holdings, Inc.
and Belden International, Inc., each a Delaware corporation.
18
"Instruments" means all "instruments" as such term is defined
in the UCC, wherever located, and, in any event, includes, without limitation,
all promissory notes and other evidences of indebtedness, other than instruments
that constitute, or are a part of a group of writings that constitute, Chattel
Paper, all whether now owned or existing or hereafter acquired or arising, by or
in favor of, any Borrower or Guarantor.
"Intellectual Property" means the collective reference to all
of the Borrowers' and the Guarantors' rights, priorities and privileges relating
to intellectual property, whether arising under United States, multinational or
foreign laws or otherwise, including, without limitation, the Copyrights, the
Copyright Licenses, the Patents, the Patent Licenses, the Trademarks and the
Trademark Licenses, and all rights to xxx at law or in equity for any
infringement or other impairment thereof, including, without limitation, the
right to receive all proceeds and damages therefrom; provided, however, that the
term "Intellectual Property" will only include the foregoing types of property
to the extent perfection may be obtained under the laws of the United States,
any state thereof or the District of Columbia.
"Interest Period" means, with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the first, second, third or sixth month
thereafter, as the Borrowers may elect in the applicable Notice or Borrowing or
Notice of Continuation or Conversion; provided that:
(i) any Interest Period (subject to paragraph
(iii) below) which would otherwise end on a day which is not a
Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day unless such Euro-Dollar
Business Day falls in another calendar month, in which case
such Interest Period shall end on the next preceding
Euro-Dollar Business Day;
(ii) any Interest Period which begins on the last
Euro-Dollar Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the
appropriate subsequent calendar month) shall, subject to
paragraph (iii) below, end on the last Euro-Dollar Business
Day of the appropriate subsequent calendar month; and
(iii) no Interest Period may be selected which
begins before the Termination Date and would otherwise end
after the Termination Date.
"Interest Rate Basis" means the Base Rate or the Adjusted
London Interbank Offered Rate, as appropriate.
"Interest Rate Protection Agreement" means an interest rate
hedging or protection agreement or any other interest rate derivative product
entered into by and between any of the Borrowers or Guarantors and any of the
Lenders, or any Affiliates of any Lenders together with all exhibits, schedules,
extensions, renewals, amendments, substitutions and replacements thereto and
thereof.
"Inventory" means "inventory" as such term is defined in the
UCC and includes, without limitation, wherever located but only to the extent
located in the United States, all goods held for sale or lease or furnished or
to be furnished under contracts of service, all goods held for
19
display or demonstration, goods on lease or consignment, spare parts, repair
parts, returned and repossessed goods, all raw materials, work-in-process,
finished goods and supplies used or consumed in a Borrower's or a Guarantor's
business, all whether now owned or existing or hereafter acquired or arising, by
or in favor of, any Borrower or Guarantor.
"Investment" means any investment in any Person, whether by
means of purchase or acquisition of obligations or securities or all or
substantially all of the assets of such Person or of a division or particular
line of business of such Person (including, without limitation, interest rate
protection, foreign currency or other hedging arrangements to be held as an
investment), capital contribution to such Person, loan or advance to such
Person, making of a time deposit with such Person, Guarantee or assumption of
any obligation of such Person or otherwise.
"Investment Property" means all "investment property" as such
term is defined in the UCC and, in any event, includes, without limitation, all
Pledged Interests and all Pledged Notes (excluding any Investment Property
consisting of Equity Interests in any Foreign Subsidiary).
"LC Issuer" means Wachovia or with regard to the Existing
Letters of Credit, the respective issuers thereunder as described in SCHEDULE
2.16.
"Lender" means each bank or other financial institution listed
on the signature pages hereof as having a Commitment, and its successors and
assigns.
"Lending Office" means, as to each Lender, its office located
at its address set forth on the signature pages hereof (or identified on the
signature pages hereof as its Lending Office) or such other office as such
Lender may hereafter designate as its Lending Office by notice to the Borrowers
and the Agent.
"Letter(s) of Credit" means (i) the Existing Letters of
Credit, as provided in SECTION 2.16 and (ii) any standby or documentary letter
of credit issued by the LC Issuer for the account of any Borrower pursuant to
ARTICLE 2.
"Letter of Credit Application Agreement" means, with respect
to a Letter of Credit, such form of application therefor (whether in a single or
several documents) as the LC Issuer may employ in the ordinary course of
business for its own account, whether or not providing for collateral security,
with such modifications thereto as may by agreed upon by the LC Issuer and the
Borrower and are not materially adverse to the interests of the Lenders;
provided, however, that in the event of any conflict between the terms of any
Letter of Credit Application Agreement and this Agreement, the terms of this
Agreement shall control.
"Letter of Credit Commitment Fee" means a fee payable to Agent
with respect to each Letter of Credit at a rate per annum equal to the
Applicable Margin for Euro-Dollar Loans times the daily average of the undrawn
amount of all outstanding Letters of Credit.
"Letter of Credit Fronting Fee" means a fee equal to 0.125% of
the face amount of each Letter of Credit.
20
"Letter of Credit Obligations" means, at any particular time,
the sum of (a) the Reimbursement Obligations at such time, (b) the aggregate
maximum amount available for drawing under the Letters of Credit at such time
and (c) the aggregate maximum amount available for drawing under Letters of
Credit the issuance of which has been requested by the relevant Borrower and
authorized by the LC Issuer but which have not yet been issued.
"Letter of Credit Rights" means "letter-of-credit rights" as
such term is defined in UCC, including, without limitation, rights to payment or
performance under a letter of credit, whether or not the beneficiary thereof has
demanded or is entitled to demand payment or performance, all whether now owned
or existing or hereafter acquired or arising, by or in favor of, any Borrower or
Guarantor.
"Lien" means, with respect to any asset, any mortgage, deed to
secure debt, deed of trust, lien, pledge, charge, security interest, security
title, preferential arrangement which has the practical effect of constituting a
security interest, encumbrance, or servitude of any kind in respect of such
asset to secure or assure payment of a Debt or a Guarantee, whether by
consensual agreement or by operation of statute or other law, or by any
agreement, contingent or otherwise, to provide any of the foregoing. For the
purposes of this Agreement, the Borrowers or any Subsidiary shall be deemed to
own subject to a Lien any asset which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such asset.
"Loan" means a Base Rate Loan, Euro-Dollar Loan, Revolving
Loan or Settlement Loan, and "Loans" means Base Rate Loans, Euro-Dollar Loans,
Revolving Loans or Settlement Loans, or any or all of them, as the context shall
require.
"London Interbank Offered Rate" means, with respect to the
Interest Period of any Euro-Dollar Loan, the rate per annum determined on the
basis of the offered rate for deposits in Dollars of amounts equal or comparable
to the principal amount of such Euro-Dollar Loan offered for a term comparable
to such Interest Period, which rates appear on the Telerate Page 3750 effective
as of 11:00 A.M., London time, 2 Euro-Dollar Business Days prior to the first
day of such Interest Period, provided that if no such offered rates appear on
such page, the "London Interbank Offered Rate" for such Interest Period will be
the arithmetic average (rounded upward, if necessary, to the next higher 1/100th
of 1%) of rates quoted by not less than 2 major banks in New York City, selected
by the Agent, at approximately 10:00 A.M., New York City time, 2 Euro-Dollar
Business Days prior to the first day of such Interest Period, for deposits in
Dollars offered by leading European banks for a period comparable to such
Interest Period in an amount comparable to the principal amount of such
Euro-Dollar Loan.
"Margin Stock" means "margin stock" as defined in Regulations
T, U or X.
"Material Adverse Effect" means, with respect to any event,
act, condition or occurrence of whatever nature (including, without limitation,
any adverse determination in any litigation, arbitration, or governmental
investigation or proceeding), whether singly or in conjunction with any other
event or events, act or acts, condition or conditions, occurrence or
occurrences, whether or not related, a material adverse change in, or a material
adverse effect upon, any of (a) the financial condition, operations, business or
properties of the Parent and its
21
Consolidated Subsidiaries taken as a whole, (b) the rights and remedies of the
Agent or the Lenders under the Credit Documents, the Agent's security interest
and Lien against the Collateral, or the ability of any of the Borrowers or the
Guarantors to pay and perform its obligations under the Credit Documents to
which it is a party (including, without limitation, the repudiation, revocation
or any attempt to do the same by any Borrower or Guarantor), as applicable, or
(c) the legality, validity or enforceability of any Credit Document.
"Material Contracts" means (a) those contracts, leases,
instruments, guaranties, licenses, agreements, and other arrangements listed in
the Collateral Disclosure Certificates and, in any event, the Material
Distributor Agreements and (b) all other contracts, leases, instruments,
guaranties, licenses, agreements, and other arrangements to which any Borrower
or Guarantor is, from time to time, a party, the breach, nonperformance,
cancellation or failure to renew by any party thereto would reasonably be
expected to have a Material Adverse Effect.
"Material Distributor Agreements" means those certain
agreements with (i) Graybar Electric Company, Inc., (ii) Houston Wire & Cable,
(iii) Anixter Inc. or any of its domestic Affiliates and (iv) any other
distributor agreements to which any Borrower or Guarantor is a party that the
Agent determines in its commercially reasonable judgment to be a material
distributor agreement and notifies Borrowers of such determination.
"Material Subsidiary" means any Subsidiary which is directly
owned by the Parent or a Subsidiary, and (a) has assets which constitute more
than 5% of the consolidated total assets of the Parent and its Consolidated
Subsidiaries at the end of the most recent Fiscal Quarter, (b) contributed more
than 5% of Consolidated Operating Income for the 4 most recent Fiscal Quarters
then ended (or, with respect to any Subsidiary which is not a Domestic
Subsidiary and which existed during the entire 4 Fiscal Quarter period but was
acquired by the Borrower during such period, which would have contributed more
than 5% of Consolidated Operating Income for such period had it been a
Subsidiary for the entire period, as determined on a pro forma basis in
accordance with GAAP), or (c) is listed on SCHEDULE 1.01.
"Moody's" means Xxxxx'x Investor Service, Inc.
"Multiemployer Plan" shall have the meaning set forth in
Section 4001(a)(3) of ERISA.
"Net Casualty/Insurance Proceeds", when used with respect to
any Condemnation Awards or insurance proceeds allocable to the Collateral, means
the gross proceeds from any Casualty or Condemnation remaining after payment of
all expenses (including attorneys' fees) incurred in the collection of such
gross proceeds.
"Net Funded Debt" means, on any date of measurement,
Consolidated Funded Debt minus Unrestricted Cash Balances.
"1999 Note Purchase Agreement" means that certain Note
Purchase Agreement dated as of September 1, 1999 among Parent and certain
noteholders from time to time party thereto, as such agreement may be hereafter
amended, restated, supplemented, refinanced, increased or reduced from time to
time, subject to SECTION 5.36.
22
"1997 Note Purchase Agreement" means that certain Note
Purchase Agreement dated as of August 1, 1997 among Parent and certain
noteholders from time to time party thereto, as amended by that certain First
Amendment to Note Purchase Agreement dated as of September 1, 1999 and as such
agreement may be hereafter amended, restated, supplemented, refinanced,
increased or reduced from time to time, subject to SECTION 5.36.
"Notes" means each of the Revolving Loan Notes or the
Settlement Loan Note, or any or all of them, as the context shall require,
together with all amendments, consolidations, modifications, renewals, and
supplements thereto.
"Notice of Borrowing" means a notice in the form of EXHIBIT
E-1.
"Notice of Continuation or Conversion" means a notice in the
form of EXHIBIT E-2.
"Obligations" means all Debts, indebtedness, liabilities,
covenants, duties and other obligations of the Borrowers: (a) to the Agent or
the Lenders included or arising from time to time under this Agreement or any
other Credit Document, whether evidenced by any note or other writing, whether
arising from the extension of credit, opening of a letter of credit, acceptance
or loan guaranty, including, without limitation, principal, interest, fees,
costs, attorney's fees and indemnification amounts and any and all extensions or
renewals thereof in whole or in part, direct or indirect, absolute or
contingent, due or to become due, primary or secondary, or joint or several; (b)
to the Agent or the LC Issuer, with respect to all Letter of Credit Obligations
and all other obligations arising in connection with the issuance of any Letter
of Credit; (c) to any Lender or Affiliate thereof arising under any Interest
Rate Protection Agreement or ForEx Obligations with any such Lender or
Affiliate, including, without limitation, any premature termination or breakage
or other costs with respect thereto limited, however, as to this clause (c), to
a maximum aggregate principal amount of $5,000,000 (prorated among all Interest
Rate Protection Agreements, if there are more than one, based on the actual (as
distinguished from notional) liability thereunder); (d) to Wachovia or any other
Lender and their respective Affiliates, arising in connection with any cash
management services or related banking services and functions provided to any
Borrower or Guarantor in connection with the conduct of such Borrower's or
Guarantor's business; and (e) to Wachovia or an Affiliate thereof arising under
any Special Foreign Guarantees, including, without limitation, any costs with
respect thereto limited, however, as to this clause (e), to a maximum aggregate
principal amount of $1,000,000 based upon actual (as distinguished from
notional) liability thereunder.
"Officer's Certificate" means a certificate in the form of
EXHIBIT I.
"Operating Income" means, as applied to any Person for any
relevant fiscal period, the aggregate amount of operating income of such Person,
before interest and taxes, for such period, as determined in accordance with
GAAP-prepared financial statements.
"Overadvance Loan" means any Loan made pursuant to clause (i)
or (ii) of SECTION 2.01(c).
"Parent" means Xxxxxx Inc., and its successors and permitted
assigns.
23
"Participant" has the meaning set forth in SECTION 10.08(b).
"Patents" means all of the following types of property of the
Borrowers and the Guarantors: (a) all letters patent including, without
limitation, all utility patents, design patents, industrial designs and utility
model registrations of the United States or any other country, or any political
subdivision thereof and all reissues and extensions thereof, including, without
limitation, those listed in the Collateral Disclosure Certificates, (b) all
applications for letters patent of the United States or any other country and
all divisions, continuations and continuations-in-part thereof, including,
without limitation, those listed in the Collateral Disclosure Certificates, and
(c) all rights to obtain any reissues, reexaminations, or extensions of the
foregoing.
"Patent Licenses" means all agreements, whether written or
oral, providing for the grant by or to a Borrower or a Guarantor of any right to
make, use, sell, offer to sell, or import any invention covered in whole or in
part by a Patent, including, without limitation, those listed in the Collateral
Disclosure Certificates, and all extensions and renewals thereof.
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Performance Pricing Determination Date" means, in determining
whether any reduction or increase shall be made to the Applicable Margin
pursuant to SECTION 2.06(a), the first Business Day of the calendar month after
receipt by Agent of the applicable financial statements and corresponding
Compliance Certificate setting forth, among other things, the calculations
necessary to determine whether any such adjustments are then necessary,
beginning with the applicable financial statements and corresponding Compliance
Certificate for the Fiscal Quarter ending December 31, 2003.
"Permitted Encumbrances" means as to any assets (including the
Collateral), the types of Liens permitted for such types of assets pursuant to
SECTION 5.17.
"Person" means an individual, a corporation, a limited
liability company, a partnership, an unincorporated association, a trust or any
other entity or organization, including, but not limited to, a government or
political subdivision or an agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan
which is covered by Title IV of ERISA or subject to the minimum funding
standards under SECTION 412 of the Code and is either (a) maintained by a member
of the Controlled Group for employees of any member of the Controlled Group or
(b) maintained pursuant to a collective bargaining agreement or any other
arrangement under which more than one employer makes contributions and to which
a member of the Controlled Group is then making or accruing an obligation to
make contributions or has within the preceding 5 plan years made contributions.
"Pledge Agreement" means the Stock Pledge Agreement dated as
of even date herewith, substantially in the form of EXHIBIT N, executed by the
Borrowers and any Guarantor that owns a Domestic Subsidiary in favor of the
Agent and to be joined in pursuant to SECTION 5.15 by any other Borrower or
Guarantor that after the Closing Date acquires a Domestic Subsidiary.
24
"Pledged Interests" means all Equity Interests of or in any
Person incorporated or organized under the laws of the United States, any state
thereof or the District of Columbia that may be issued or granted to, or held or
owned by, a Borrower or Guarantor, including, without limitation, such Equity
Interests described in the Collateral Disclosure Certificates, and all
certificates representing such Equity Interests.
"Pledged Notes" means all Instruments listed in the Collateral
Disclosure Certificates and all other Instruments issued to or held by a
Borrower or a Guarantor.
"Pledged Stock" means the capital stock described in and
pledged pursuant to the Pledge Agreement, which constitutes Investment Property
in which a security interest is granted hereunder.
"Prime Rate" refers to that interest rate so denominated and
set by Wachovia from time to time as an interest rate basis for borrowings. The
Prime Rate is but one of several interest rate bases used by Wachovia. Wachovia
lends at interest rates above and below the Prime Rate.
"Purchase Money Lien" means any Lien (including a negative
pledge arrangement) granted by any Borrower, Guarantor or any Subsidiary from
time to time to vendors or financiers of equipment or property to secure the
payment of the purchase price thereof so long as (a) such Liens extend only to
the specific equipment or property so purchased, (b) secure only such deferred
payment obligation and related interest, fees and charges and other obligations
under the related contract and no other Debt, and (c) are promptly released upon
the payment in full of such purchase price and related interest, fees and
charges by operation of law or otherwise.
"Real Properties" means all real property of whatever nature
now or hereafter owned, leased or operated by the Borrowers or the Guarantors,
or in which the Borrowers or the Guarantors otherwise have an interest, and
wherever located.
"Redeemable Preferred Stock" of any Person means any preferred
stock issued by such Person which is at any time prior to the Termination Date
either (a) mandatorily redeemable (by sinking fund or similar payments or
otherwise) or (b) redeemable at the option of the holder thereof.
"Refunding Loan" means a new Syndicated Loan made on the day
on which an outstanding Syndicated Loan is maturing as a refinancing thereof as
provided by SECTION 2.02(d), if and to the extent that the proceeds thereof are
used entirely for the purpose of refinancing such maturing Loan, excluding any
difference between the amount of such maturing Loan and any greater amount being
borrowed on such day and actually either being made available to the Borrowers
pursuant to SECTION 2.02(c) or remitted to the Agent as provided in SECTION
2.12, in each case as contemplated in SECTION 2.02(d).
"Register" has the meaning set forth in SECTION 10.08(c).
25
"Regulation T" means Regulation T of the Board of Governors of
the Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"Regulation X" means Regulation X of the Board of Governors of
the Federal Reserve System, as in effect from time to time, together with all
official rulings and interpretations issued thereunder.
"Reimbursement Obligations" means the unpaid reimbursement or
repayment obligations of the relevant Borrower to the LC Issuer pursuant to
SECTION 2.19 with respect to Letters of Credit that have been drawn.
"Related 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.
"Required Lenders" means at any time Lenders holding
Commitment Percentages equal to at least 66 2/3% of the aggregate amount of the
Commitments or, if the Commitments are no longer in effect, Lenders holding at
least 66 2/3% of the aggregate outstanding principal amount of the Working
Capital Obligations; provided, however, that such calculation shall be made
without including the Commitment of or principal amount of Notes held by any
Lender which is in default with respect to its obligations to the Agent, the
Borrower or any Lender. As of the Closing Date, the Lenders have the following
Commitment Percentages: (a) Wachovia: 33.3%; (b) U.S. Bank National Association:
30.0%; (c) Comerica Bank: 10.0%; (d) The Northern Trust Company: 10.0%; (e) ING
Bank N.V.: 10.0%; and (f) Fifth Third Bank, Indiana: 6.6%.
"Restricted Payment" means (a) any dividend or other
distribution on any shares of the Parent's Capital Stock or Redeemable Preferred
Stock (except dividends payable solely in shares of its Capital Stock or
Redeemable Preferred Stock); (b) any payment on account of the purchase,
redemption, retirement, defeasance, or other acquisition of or sinking fund for
(i) any shares of the Parent's Capital Stock or Redeemable Preferred Stock
(except shares acquired upon the conversion thereof into other shares of its
Capital Stock or Redeemable Preferred Stock), or (ii) any option, capital
appreciation rights, stock appreciation rights, warrant or other right to
acquire shares of the Parent's Capital Stock or Redeemable Preferred Stock; or
(c) any payment prior to the scheduled maturity of any Subordinated Debt or
other Debt (other than the Obligations) of any Borrower or Guarantor.
"Revolving Loans" means the revolving loans (and Settlement
Loans) to be made by each of the Lenders in accordance with SECTION 2.01(a).
"Revolving Loan Notes" means the promissory notes of the
Borrowers substantially in the form of EXHIBIT A-1, evidencing the obligation of
the Borrowers to repay
26
Revolving Loans (other than Settlement Loans), together with all amendments,
consolidations, modifications, renewals and supplements thereto.
"Securities Account Control Agreement" means a Securities
Account Control Agreement substantially in the form of EXHIBIT R, with any
changes as may be acceptable to the Agent in its sole discretion, or a similar
control agreement in form and substance acceptable to the Agent, executed and
delivered by an Approved Securities Intermediary at which a Borrower or
Guarantor maintains a securities account.
"Security Documents" means this Agreement, all Deposit Account
Control Agreements, all Securities Account Control Agreements, the Pledge
Agreement, and the Waiver Agreements, and any and all other documents executed
or delivered by any Borrower or Guarantor to Agent for purposes of, or in
connection with, the creating, attachment, or perfection of the Agent's security
interest in and to any of the Collateral or the Pledged Stock.
"Senior Notes" means, individually and collectively, as the
context shall require, the notes issued pursuant to the Senior Note Purchase
Agreements.
"Senior Note Purchase Agreements" means, individually and
collectively, as the context shall require, the 1999 Note Purchase Agreement and
the 1997 Note Purchase Agreement.
"Senior Officer" means any of the following officers of the
Borrowers and the Guarantors regardless of actual title: Chief Executive
Officer; Chief Operating Officer (if any); Chief Financial Officer; and General
Counsel.
"Settlement Date" has the meaning set forth in SECTION
2.01(b)(i).
"Settlement Loan" means a Loan made by Wachovia pursuant to
SECTION 2.01(b), which must be a Base Rate Loan.
"Settlement Loan Note" means the promissory note of the
Borrowers, substantially in the form of EXHIBIT A-2, evidencing the obligation
of the Borrowers to repay the Settlement Loans, together with all amendments,
consolidations, modifications, renewals and supplements thereto.
"S&P" means Standard & Poor's Ratings Group, a division of
XxXxxx-Xxxx, Inc.
"Special Foreign Guarantees" shall mean Guarantees issued by
Wachovia or an Affiliate thereof for the benefit of Foreign Subsidiaries of the
Borrowers and Guarantors to cover (i) customs, excise and similar taxes in the
United Kingdom and (ii) overdraft protection in connection with certain Canadian
Deposit Accounts.
"Stockholders' Equity" means, at any time, the shareholders'
equity of the Parent and its Subsidiaries, as set forth or reflected on the most
recent consolidated balance sheet of the Parent and its Subsidiaries prepared in
accordance with GAAP, but excluding any Redeemable Preferred Stock of the Parent
or any of its Subsidiaries. Shareholders' equity generally would include, but
not be limited to (a) the par or stated value of all outstanding Capital Stock,
(b)
27
capital surplus, (c) retained earnings, and (d) various deductions such as (i)
purchases of treasury stock, (ii) valuation allowances, (iii) receivables due
from an employee stock ownership plan, (iv) employee stock ownership plan debt
guarantees, and (v) translation adjustments for foreign currency transactions.
"Subordinated Debt" means any Debt, which is unsecured, of any
Borrower or any Subsidiary to any Person which, by written agreement, has been
subordinated in right of payment and claim, to the rights and claims of the
Agent, the Lenders and Wachovia and the LC Issuer in respect of the Obligations,
on terms and conditions reasonably satisfactory to the Required Lenders.
"Subsidiary" of any Person means a corporation, partnership or
other entity of which sufficient shares of stock or other ownership interests
having ordinary voting power to elect a majority of the board of directors or
other persons performing similar functions of such corporation, partnership or
other entity are at the time owned, directly or indirectly through one or more
intermediaries, or both, by such Person. Unless otherwise qualified, all
references to a "Subsidiary" or to "Subsidiaries" in this Agreement shall refer
to a Subsidiary or Subsidiaries of the Parent. For the avoidance of doubt, BB
Communications Service Facility, LLC, a Delaware limited liability company that
does business under the name "Echelon", is not a Subsidiary.
"Supporting Obligations" means all "supporting obligations" as
such term is defined in the UCC, and, in any event, includes, without
limitation, letters of credit and guaranties issued in support of Accounts,
Chattel Paper, Documents, General Intangibles, Instruments, or Investment
Property.
"Syndicated Loans" means Revolving Loans, but not Settlement
Loans.
"Syndication Agent" means U.S. Bank National Association.
"Tax Related Foreign Advances" means that flow of funds
associated with the original issue discount note program of Belden (UK) Limited
involving loans made once annually, typically during December of each year, from
Belden Technologies, Inc. to Belden (UK) XXXXX Limited Partnership and then from
Belden (UK) XXXXX Limited Partnership to Belden (UK) Limited and then repaid by
Belden (UK) Limited to Belden (UK) XXXXX Limited Partnership and by Belden (UK)
XXXXX Limited Partnership to Belden Technologies, Inc. within two weeks, the
principal amount of which loans escalates each year by the amount of discount
capitalized from the prior year (as of the Closing Date, the amount anticipated
to be lent in December 2003 is approximately the Dollar equivalent of
L17,900,000).
"Taxes" has the meaning set forth in SECTION 2.12(c).
"Termination Date" means whichever is the earlier of (a) June
30, 2006, (b) the date the Commitments are terminated pursuant to SECTION 6.01
following the occurrence of an Event of Default, or (c) the date the Borrowers
terminate the Commitments entirely pursuant to SECTION 2.08.
28
"Test Ratio" means, as of any date of determination, the ratio
of (i) Net Funded Debt as of such date to (ii) Consolidated EBITDA for the
period of 12 Fiscal Months ended on such date.
"Third Party" means any landlord, warehousemen, servicer,
processor, bailee and other third parties which may, from time to time, be in
the possession or control of, any Collateral or any property on which any
Collateral is or may be located.
"Third Party Claims" means claims of Third Parties against any
Borrower or Guarantor for rent, storage, maintenance, repair, processing,
servicing or bailment in respect of any Collateral or any property on which any
Collateral is or may be located.
"Trademarks" means all of the following types of property of
the Borrowers and the Guarantors: (a) all trademarks, trade names, corporate
names, company names, business names, fictitious business names, service marks,
logos, words, terms, names, symbols and devices and all combinations thereof,
and all other source or business identifiers, and all goodwill of the business
connected with the use thereof as symbolized thereby, all registrations and
recordings thereof, and all applications in connection therewith, whether in the
United States Patent and Trademark Office or in any similar office or agency of
the United States, any State thereof or any other country or any political
subdivision thereof, or otherwise, and all common-law rights related thereto,
including, without limitation, those listed in the Collateral Disclosure
Certificates, and (ii) the right to obtain all renewals and extensions thereof.
"Trademark Licenses" means all agreements, whether written or
oral, providing for the grant by or to a Borrower or Guarantor of any right to
use any Trademark, including, without limitation, those listed in the Collateral
Disclosure Certificates, and all renewals of extensions thereof.
"Transferee" has the meaning set forth in SECTION 10.08(d).
"UCC" means the Uniform Commercial Code Secured Transactions
of New York, as in effect on the date hereof and as the same may be amended,
restated, supplemented, or otherwise modified from time to time.
"Unfunded Vested Liabilities" means, with respect to any Plan
at any time, the amount (if any) by which (a) the present value of all vested
nonforfeitable benefits under such Plan exceeds (b) the fair market value of all
Plan assets allocable to such benefits, all determined as of the then most
recent valuation date for such Plan, but only to the extent that such excess
represents a potential liability of a member of the Controlled Group to the PBGC
or the Plan under Title IV of ERISA.
"Unrestricted Cash Balances" means, at any time of
determination, the aggregate amount of all cash deposits of the Borrowers and
the Guarantors maintained in any demand deposit account maintained in the United
States with the Agent or in a Collateral Reserve Account or with an Approved
Depository, to the extent such cash deposits are subject to the Agent's
first-priority perfected security interest and are free of any Lien or other
encumbrance (other than (i) customary Liens arising in the ordinary course of
business which the depository institution may have with respect to any right of
offset against funds in such account, (ii)
29
customary holds for uncollected deposits, and (iii) Liens granted to the Agent
and securing the Obligations).
"Unused Commitment" means at any date, (a) with respect to all
Lenders, an amount equal to the Aggregate Commitments less the Working Capital
Obligations and (b) with respect to any Lender, an amount equal to the aggregate
Unused Commitments determined in the immediately preceding clause (a) multiplied
by such Lender's Commitment Percentage.
"Unused Line Fee" means with respect to any Lender the fee
calculated on the average daily amount of such Lender's pro rata share of the
Unused Commitment (without taking into account any Settlement Loans) during each
calendar quarter, at a rate per annum determined by reference to the table
below, depending on the percentage of the average daily amount of Unused
Commitment during such calendar quarter:
PERCENTAGE OF AVERAGE
DAILY UNUSED UNUSED LINE FEE
COMMITMENT PERCENTAGE
------------------------------------------------------------
> or = 67.0% 0.75%
------------------------------------------------------------
< 67.0% but > or = 33.0 0.50%
------------------------------------------------------------
< 33.0% 0.375%
------------------------------------------------------------
"Vehicles" means all of the Borrowers' and Guarantors' cars,
trucks, trailers, rolling stock, construction and earth moving equipment and
other vehicles covered by a certificate of title law of any state and all tires
and other appurtenances to any of the foregoing, all whether now existing or
owned or hereafter acquired or arising.
"Wachovia" means Wachovia Bank, National Association, a
national banking association, and its successors.
"Waiver Agreement" means a Waiver and Agreement substantially
in the form of EXHIBIT J, with any changes as may be acceptable to the Agent in
its sole discretion, executed and delivered by any Third Party waiving or
subordinating its Third Party Claims, and making certain other agreements in
regard to the Collateral, all on terms satisfactory to the Agent in all
respects.
"Wholly Owned Subsidiary" means any Subsidiary all of the
shares of capital stock or other ownership interests of which (except directors'
qualifying shares) are at the time directly or indirectly owned by the Parent.
30
"Working Capital Obligations" means the sum at any time of (a)
the aggregate principal amount outstanding under the Revolving Loans (including,
without limitation, the Settlement Loans) and (b) the Letter of Credit
Obligations.
SECTION 1.02. Accounting Terms and Determinations. Unless
otherwise specified herein, all terms of an accounting character used herein
shall be interpreted, all accounting determinations hereunder shall be made, and
all financial statements required to be delivered hereunder shall be prepared,
in accordance with GAAP, applied on a basis consistent (except for changes
concurred in by the Certified Public Accountants or otherwise required by a
change in GAAP) with the most recent audited consolidated financial statements
of the Parent and the Subsidiaries delivered to the Lenders unless with respect
to any such change concurred in by the Certified Public Accountants or required
by GAAP, in determining compliance with any of the provisions of this Agreement
or any of the other Credit Documents: (a) the Parent shall have objected to
determining such compliance on such basis at the time of delivery of such
financial statements, or (b) the Required Lenders shall so object in writing
within 30 days after the delivery of such financial statements, in either of
which events such calculations shall be made on a basis consistent with those
used in the preparation of the latest financial statements as to which such
objection shall not have been made (which, if objection is made in respect of
the first financial statements delivered under SECTION 5.01 hereof, means the
financial statements referred to in SECTION 4.04).
SECTION 1.03. References. Unless otherwise indicated,
references in this Agreement to "articles", "exhibits", "schedules", "sections"
and other subdivisions are references to articles, exhibits, schedules, sections
and other subdivisions hereof. Terms which are defined in the UCC and which are
not otherwise defined herein or in the other Credit Documents shall have the
meanings given such terms in the UCC.
SECTION 1.04. Use of Defined Terms. All terms defined in this
Agreement shall have the same defined meanings when used in any of the other
Credit Documents, unless otherwise defined therein or unless the context shall
require otherwise.
SECTION 1.05. Terminology. The terms "herein," "hereof" and
"hereunder" and other words of similar import refer to this Agreement as a whole
and not to any particular section, paragraph or subdivision. Any pronoun used
shall be deemed to cover all genders. 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 means "to but excluding." Unless
and to the extent otherwise expressly provided herein, the term "pro rata" when
applied to a Lender means such Lender's Commitment Percentage. The section
titles, table of contents and list of exhibits appear as a matter of convenience
only and shall not affect the interpretation of this Agreement. All references
to statutes and related regulations shall include any amendments of same and any
successor statutes and regulations. All references to any of the Credit
Documents shall include any and all amendment or modifications thereto and any
and all restatements, extensions or renewals thereof. All references to any
Person shall mean and include the successors and permitted assigns of such
Person. All references to "including" and "include" shall be understood to mean
"including, without limitation." All references to the time of day shall mean
the time of day on the day in question in Charlotte, North Carolina, unless
otherwise expressly provided in this Agreement. A Default or an Event of Default
shall be
31
deemed to exist at all times during the period commencing on the date that such
Default or Event of Default occurs to the date on which such Default or Event of
Default is waived in writing pursuant to this Agreement or, in the case of a
Default, is cured within any period of cure expressly provided in this
Agreement; and an Event of Default shall "continue" to be "continuing" until
such Event of Default has been waived in writing by Agent. Whenever the phrase
"to the best of Borrowers' and Guarantors' knowledge", "to the best of a Senior
Officer's knowledge" or words of similar import relating to the knowledge or the
general awareness (rather than the actual awareness) of any Borrower, Guarantor
or Senior Officer are used herein, such phrase shall mean and refer to (a) the
actual knowledge of a Senior Officer or (b) the knowledge that a Senior Officer
would have obtained if he had engaged in a good faith and diligent performance
of his duties, including, as appropriate, the making of such reasonable specific
inquiries as may be necessary of the officers, employees or agents of any
Borrower or Guarantor and a good faith attempt to ascertain the existence or
accuracy of the matter to which such phrase relates. All calculations of money
values shall be in Dollars, all Loans made hereunder shall be funded in Dollars,
and all amounts payable in respect of any of the Obligations shall be paid in
Dollars. Any Lien referred to in this Agreement or any of the other Credit
Documents as having been created in favor of the Agent, any agreement entered
into by the Agent pursuant to this Agreement or any of the other Credit
Documents, any payment made by or to or funds received by the Agent pursuant to
or as contemplated by any of the Credit Documents, or any other act taken or
admitted to be taken by the Agent shall, unless otherwise expressly provided, be
created, entered into, made or received or taken or omitted, for the benefit or
account of the Agent and the Lenders.
ARTICLE 2
THE CREDITS
SECTION 2.01. Commitments to Lend.
(a) Revolving Loans. Each Lender severally agrees, on the
terms and conditions set forth herein, to make Revolving Loans to the Borrowers
from time to time before the Termination Date upon request by the Borrowers
pursuant hereto; provided that, immediately after each such Revolving Loan is
made,
(i) the sum of (A) the principal amount of the
Revolving Loans outstanding of each Lender plus (B) such
Lender's Commitment Percentage of the Letter of Credit
Obligations, will not exceed such Lender's Commitment, and
(ii) the Working Capital Obligations will not
exceed the lesser of (A) the amount of the Aggregate
Commitments, and (B) the aggregate amount of the Borrowing
Base (subject, however, to Overadvance Loans made pursuant to
SECTION 2.01(c)).
Each Syndicated Borrowing under this SECTION 2.01(a) shall be in an aggregate
principal amount of (A) for Euro-Dollar Borrowings, $5,000,000 or any larger
integral multiple of $1,000,000, and (B) for Base Rate Borrowings, $1,000,000 or
any larger integral multiple of $1,000,000 (except that any Revolving Loan
Borrowing may be in the aggregate amount of the Excess Borrowing Availability)
and shall be made from the several Lenders ratably in proportion
32
to their respective Commitments. Within the foregoing limits, the Borrowers may
borrow under this SECTION, repay or, to the extent permitted by SECTION 2.10,
prepay Revolving Loans and reborrow under this SECTION at any time before the
Termination Date.
(b) Settlement among Lenders; Settlement Loans.
(i) To facilitate the administration of the
Revolving Loans under this Agreement, the Lenders agree (which
agreement shall not be for the benefit of or enforceable by
any Borrower) that settlement among the Lenders with respect
to the Revolving Loans may take place on a periodic basis on
dates determined from time to time by the Agent (each a
"Settlement Date"), which may occur before or after the
occurrence or during the continuance of a Default or Event of
Default and whether or not all of the conditions set forth in
ARTICLE 9 of this Agreement have been satisfied, provided that
any such Revolving Loan for which settlement is to be made
must have been advanced prior to the date on which the
Commitments have been terminated pursuant to SECTION 6.01. On
each Settlement Date, payment shall be made by or to each
Lender in the manner provided herein and in accordance with
the settlement report delivered by the Agent to the Lenders
with respect to such Settlement Date so that, as of each
Settlement Date, each Lender shall hold its Commitment
Percentage of all Revolving Loans then outstanding. As of the
Closing Date, the Agent intends to request settlement with the
Lenders once every 10 Domestic Business Days.
(ii) Between Settlement Dates, the Agent may
request Wachovia to advance, and Wachovia may, but shall in no
event be obligated to, advance as a Settlement Loan to the
Borrowers out of Wachovia's own funds the entire principal
amount of any Revolving Loan Borrowings that are Base Rate
Borrowings requested or deemed requested pursuant to this
Agreement. The aggregate principal amount of the Settlement
Loans outstanding at any time shall not exceed $5,000,000.
Each Settlement Loan shall constitute a Revolving Loan
hereunder and shall be subject to all of the terms, conditions
and security applicable to other Revolving Loans, except that
all payments thereon shall be payable to Wachovia solely for
its own account. The obligation of the Borrowers to repay such
Settlement Loans to Wachovia shall be evidenced by the records
of Wachovia (such records to constitute rebuttable presumptive
evidence of such obligations). The Agent shall not request
Wachovia to make any Settlement Loan if (A) the Agent shall
have received written notice from any Lender that one or more
of the applicable conditions precedent set forth in ARTICLE 9
hereof will not be satisfied on the requested funding date for
the applicable Borrowing, or (B) the requested Borrowing would
exceed the amount of Revolving Loans permitted to be made
under SECTION 2.01(a). Wachovia shall not otherwise be
required to determine whether the applicable conditions
precedent set forth in ARTICLE 9 hereof have been satisfied or
the requested Borrowing would exceed the amount of Revolving
Loans permitted to be made under SECTION 2.01(a) prior to
making, in its sole discretion, any Settlement Loan. On each
Settlement Date, or, if earlier, upon demand by the Agent for
payment thereof, the then outstanding Settlement Loans shall
be immediately due and payable by the other Lenders.
33
The Borrowers shall be deemed to have requested Revolving
Loans to be made on each Settlement Date in the amount of all
outstanding Settlement Loans and the proceeds of such
Revolving Loans shall be applied to the repayment of such
Settlement Loans. The Agent shall notify the Lenders of the
amount of Revolving Loans to be so funded prior to 12:00 noon,
Charlotte, North Carolina, time, on such funding date. The
proceeds of Settlement Loans may be used solely for purposes
for which Revolving Loans may be used in accordance with
SECTION 5.06 hereof. If any amounts received by Wachovia in
respect of any Settlement Loans are later required to be
returned or repaid by Wachovia to any Borrower or their
respective representatives or successors-in-interest, whether
by court order, settlement or otherwise, each Lender shall,
upon demand by Wachovia with notice to Agent, pay to Agent for
the account of Wachovia an amount equal to such Lender's
Commitment Percentage of all such amounts required to be
returned by Wachovia.
(c) Overadvance Loans. Notwithstanding the existence of a
Default or an Event of Default or any other provision of this Agreement to the
contrary, provided the Commitments have not been terminated pursuant to SECTION
6.01, (i) the Agent may, from time to time, in the exercise of its sole
discretion, upon request by the Borrowers pursuant hereto, advance Revolving
Loans on behalf of the Lenders equal to the lesser of (A) the Unused Commitment,
and (B) an amount not greater than $3,000,000 in excess of the amount of the
Borrowing Base, and/or (ii) Wachovia may, from time to time in the exercise of
its sole discretion, at the request of the Agent and in the exercise of the
Agent's sole discretion, upon request by the Borrowers pursuant hereto, make
Settlement Loans equal to the lesser of (A) the Unused Commitment, and (B) an
amount not greater than $3,000,000 in excess of the amount of the Borrowing
Base; provided, however, that each Overadvance Loan made pursuant to this
SECTION 2.01(c) shall (x) become due and payable in full on or before the date
which is 10 Business Days after such Overadvance Loan is made, and (y) not be
made during any period longer than 10 Business Days after the date on which such
first Overadvance Loan was made in excess of the Borrowing Base under this
SECTION 2.01(c).
SECTION 2.02. Method of Borrowing.
(a) The Borrowers shall give the Agent a Notice of
Borrowing prior to (i) as to Base Rate Borrowings, 11:00 A.M. (Charlotte, North
Carolina, time) on the Domestic Business Day of such Base Rate Borrowing, and
(ii) as to Euro-Dollar Borrowings, 11:00 A.M. (Charlotte, North Carolina, time)
3 Euro-Dollar Business Days before such Euro-Dollar Borrowing, specifying:
(i) the date of such Borrowing, which shall be a
Domestic Business Day in the case of a Base Rate Borrowing or
a Euro-Dollar Business Day in the case of a Euro-Dollar
Borrowing,
(ii) the aggregate amount of such Borrowing,
(iii) whether the Loans comprising such Borrowing
are to be Base Rate Loans or Euro-Dollar Loans, and
34
(iv) in the case of a Euro-Dollar Borrowing, the
duration of the Interest Period applicable thereto, subject to
the provisions of the definition of Interest Period.
(b) Upon receipt of a Notice of Borrowing, the Agent
shall promptly notify each Lender of the contents thereof and of such Lender's
ratable share of such Borrowing, unless it is to be advanced as a Settlement
Loan Borrowing, and such Notice of Borrowing, once received by the Agent, shall
not thereafter be revocable by the Borrowers.
(c) Not later than (i) as to Euro-Dollar Borrowings,
11:00 A.M. (Charlotte, North Carolina, time), and (ii) as to Base Rate
Borrowings, 2:00 P.M. (Charlotte, North Carolina, time), on the date of each
Syndicated Borrowing, each Lender shall (except as provided in paragraph (e) of
this SECTION) make available its ratable share of such Syndicated Borrowing, in
Federal or other funds immediately available in Charlotte, North Carolina, to
the Agent at its address determined pursuant to SECTION 10.01. Unless the Agent
determines that any applicable condition specified in ARTICLE 9 has not been
satisfied, the Agent will make the funds so received from the Lenders available
to the Borrowers at the Agent's aforesaid address. Unless the Agent receives
notice from a Lender, at the Agent's address referred to in or specified
pursuant to SECTION 10.01, no later than 4:00 P.M. (local time at such address)
on the Domestic Business Day before the date of a Syndicated Borrowing stating
that such Lender will not make a Syndicated Loan in connection with such
Syndicated Borrowing, the Agent shall be entitled to assume that such Lender
will make a Syndicated Loan in connection with such Syndicated Borrowing and, in
reliance on such assumption, the Agent may (but shall not be obligated to) make
available such Lender's ratable share of such Syndicated Borrowing to the
Borrowers for the account of such Lender. If the Agent makes such Lender's
ratable share available to the Borrowers and such Lender does not in fact make
its ratable share of such Syndicated Borrowing available on such date, the Agent
shall be entitled to recover such Lender's ratable share from such Lender or the
Borrowers (and for such purpose shall be entitled to charge such amount to any
account of the Borrowers maintained with the Agent), together with interest
thereon for each day during the period from the date of such Syndicated
Borrowing until such sum shall be paid in full at a rate per annum equal to the
rate at which the Agent determines that it obtained (or could have obtained)
overnight Federal funds to cover such amount for each such day during such
period, provided that (x) any such payment by the Borrowers of such Lender's
ratable share and interest thereon shall be without prejudice to any rights that
the Borrowers may have against such Lender and (y) until such Lender has paid
its ratable share of such Syndicated Borrowing, together with interest pursuant
to the foregoing, it will have no interest in or rights with respect to such
Syndicated Borrowing for any purpose hereunder. If the Agent does not exercise
its option to advance funds for the account of such Lender, it shall forthwith
notify the Borrowers of such decision.
(d) If any Lender makes a new Syndicated Loan hereunder
on a day on which the Borrowers are to repay all or any part of an outstanding
Syndicated Loan from such Lender, such Lender shall apply the proceeds of its
new Syndicated Loan to make such repayment as a Refunding Loan and only an
amount equal to the difference (if any) between the amount being borrowed and
the amount of such Refunding Loan shall be made available by such Lender to the
Agent as provided in paragraph (c) of this SECTION, or remitted by such Borrower
to the Agent as provided in SECTION 2.12, as the case may be.
35
(e) Notwithstanding anything to the contrary contained in
this Agreement, the Lenders shall not be obligated to make any Euro-Dollar Loans
if there shall have occurred a Default or an Event of Default, which Default or
Event of Default shall not have been cured or waived, and all Refunding Loans
shall be made as Base Rate Loans (but shall bear interest at the Default Rate,
if applicable). Nothing in the preceding sentence shall obligate, or be deemed
to obligate, any of the Lenders to make any Loans at all during the existence of
an Event of Default, other than (i) Refunding Loans in the event that the
Obligations have not been accelerated pursuant to SECTION 6.01, and (ii)
advances on any Settlement Date of a Lender's Commitment Percentage of
Settlement Loans or Overadvance Loans made prior to the termination of the
Commitments pursuant to SECTION 6.01.
(f) In the event that a Notice of Borrowing fails to
specify whether the Syndicated Loans comprising such Syndicated Borrowing are to
be Base Rate Loans or Euro-Dollar Loans, such Syndicated Loans shall be made as
Base Rate Loans.
(g) Notwithstanding anything to the contrary contained
herein, there shall not be more than 5 Euro-Dollar Borrowings outstanding at any
given time.
SECTION 2.03. Continuation and Conversion Elections.
(a) By delivering a Notice of Continuation or Conversion
to the Agent on or before 12:00 P.M., Charlotte, North Carolina time, on a
Domestic Business Day (or Euro-Dollar Business Day, in the case of Euro-Dollar
Loans outstanding), the Borrowers may from time to time irrevocably elect, by
notice on the same Domestic Business Day, in the case of Base Rate Loans, or at
least 3 Euro-Dollar Business Days prior to the last day of the then current
Interest Period with respect thereto, in the case of Euro-Dollar Loans, that all
of the associated Borrowing, or any portion thereof in an aggregate principal
amount of $5,000,000 or any larger integral multiple of $1,000,000 be, (i) in
the case of Base Rate Loans, converted into Euro-Dollar Loans or, (ii) in the
case of Euro-Dollar Loans, converted into Base Rate Loans or continued as
Euro-Dollar Loans (in the absence of delivery of a Notice of Continuation or
Conversion with respect to any Euro-Dollar Loan at least 3 Euro-Dollar Business
Days before the last day of the then current Interest Period with respect
thereto, such Euro-Dollar Loan shall, on such last day, automatically convert to
a Base Rate Loan except to the extent repaid); provided, however, that (x) each
such conversion or continuation shall be pro rated among the applicable
outstanding Loans of all Lenders that have made such Loans in accordance with
their Commitment Percentages, and (y) no portion of the outstanding principal
amount of any Loans may be continued as, or be converted into, any Euro-Dollar
Loan when any Event of Default has occurred and is continuing.
SECTION 2.04. Notes.
(a) The Revolving Loans of each Lender shall be evidenced
by a single Revolving Loan Note payable to the order of such Lender for the
account of its Lending Office in an amount equal to the original principal
amount of such Lender's Commitment. The Settlement Loans shall be evidenced by a
single Settlement Loan Note payable to the order of Wachovia in the original
principal amount of $5,000,000.
36
(b) Upon receipt of each Lender's Notes pursuant to
SECTION 9.01, the Agent shall deliver such Notes to such Lender. Each Lender (or
Wachovia, with respect to the Settlement Loan Note) shall record, and prior to
any transfer of its Notes shall endorse on the schedules forming a part thereof
appropriate notations to evidence: the date, amount and maturity of, and
effective interest rate for, each Loan made by it, and the date and amount of
each payment of principal made by the Borrowers with respect thereto, and such
schedules of each such Lender's Notes shall constitute rebuttable presumptive
evidence of the respective principal amounts owing and unpaid on such Lender's
Notes; provided that the failure of any Lender to make, or any error in making,
any such recordation or endorsement shall not affect the obligation of the
Borrowers hereunder or under the Notes or the ability of any Lender to assign
its Notes. Each Lender is hereby irrevocably authorized by the Borrowers so to
endorse its Notes, and to attach to and make a part of any Note a continuation
of any such schedule as and when required.
(c) The Agent shall maintain on its books a control
account for the Borrowers in which shall be recorded (i) the date, amount,
effective interest rate and maturity of each Revolving Loan and Settlement Loan
made hereunder to the Borrowers, (ii) the amount of any principal, interest or
fees due or to become due from the Borrowers on the Revolving Loans and the
Settlement Loans and (iii) the amount of any sum received by the Agent hereunder
in respect of any such principal, interest or fees due on the Revolving Loans
and Settlement Loans and each Lender's Commitment Percentage thereof.
(d) The entries made in the accounts pursuant to
paragraph (c) above shall be rebuttable presumptive evidence of the existence
and amounts of the Obligations of the Borrowers therein recorded and any
payments thereon, and in case of discrepancy between such accounts and the
schedules to the Notes maintained by any Lender pursuant to paragraph (b) or
between such accounts and the books and records of the Borrowers, in the absence
of rebuttal evidence to the contrary, the control account maintained by the
Agent pursuant to paragraph (c) above shall be controlling with respect to
Revolving Loans and Settlement Loans.
SECTION 2.05. Maturity of Loans.
(a) Each Euro-Dollar Loan included in any Borrowing will
mature, and the principal amount thereof will be due and payable, on the last
day of the Interest Period applicable to such Borrowing, subject to continuation
or conversion of such Euro-Dollar Loan pursuant to SECTION 2.03, unless such
Loan will be due and payable prior thereto by reason of the provisions of this
Agreement (including, without limitation, SECTION 6.01).
(b) Notwithstanding the foregoing, the outstanding
principal amount of all Loans, if any, together with all accrued but unpaid
interest thereon, if any, shall be due and payable on the Termination Date.
SECTION 2.06. Interest Rates.
(a) The Applicable Margin shall be subject to reduction
or increase, as applicable and as set forth in the table appearing in the
definition of "Applicable Margin" herein, on a quarterly basis according to the
performance of the Borrowers as measured by the Test Ratio as determined as of
the end of the Fiscal Quarter ending immediately prior to the relevant
37
Performance Pricing Determination Date. Except as set forth in the last sentence
hereof, any such increase or reduction in the Applicable Margin provided for
herein shall be effective on the Performance Pricing Determination Date;
provided, however, that for Euro-Dollar Loans, any reduction in the Applicable
Margin shall only be effective for Interest Periods commencing on or after the
Performance Pricing Determination Date. If the financial statements and the
Compliance Certificate of the Borrowers setting forth the Test Ratio are not
received by Agent by the date required pursuant to SECTION 5.01(a) and (b) of
this Agreement (and without limiting the Agent's and the Lenders rights to
invoke the Default Rate to the extent permitted hereby), the Applicable Margin
shall be determined as if the Test Ratio exceeds the ratio set forth as Level I
in the table noted above until such time as such financial statements and
Compliance Certificate are received and any Event of Default resulting from a
failure to timely deliver such financial statements or Compliance Certificate is
waived in writing by the Agent and the Required Lenders. For the final Fiscal
Quarter of any Fiscal Year, the Borrowers may in their discretion provide the
unaudited financial statements of Borrowers, subject only to year-end
adjustments, for the purpose of determining the Applicable Margin, the resulting
reduction in such Applicable Margin to occur on the day of receipt by the Agent
of such unaudited financial statements; provided, however, if, upon delivery of
the annual audited financial statements required to be submitted by the
Borrowers to Agent pursuant to SECTION 5.01(a) of this Agreement, the Applicable
Margin pursuant to the terms herein based on such audited financial statements
for the final quarter of such Fiscal Year then ended would not be the same as
the Applicable Margin as reduced based on the unaudited financial statements,
then (x) effective on the first Business Day of the month following receipt by
the Agent of such audited financial statements, such Applicable Margin reduction
shall be terminated and the Applicable Margin shall be as determined by the
terms herein based on such audited financial statements, and (y) if the
Applicable Margin pursuant to the terms herein based on the audited financial
statements is greater than the Applicable Margin as reduced based on the
unaudited financial statements, the Borrowers shall pay to the Agent, for the
benefit of the Lenders, on the first Business Day of the month following receipt
by the Agent of such audited financial statements, an amount equal to the excess
of (i) the amount of interest or fees that would have been paid on the principal
amount of the Obligations pursuant to the terms herein during the period of the
reduction in the Applicable Margin (based on the unaudited financial statements
of the Borrowers) if such reduction had not been implemented, over (ii) the
amount of interest or fees actually paid during the period of the reduction in
the Applicable Margin based on the unaudited financial statements of the
Borrowers.
(b) Each Base Rate Loan shall bear interest on the
outstanding principal amount thereof, for each day from the date such Loan is
made until it becomes due, at a rate per annum equal to the Base Rate for such
day plus the Applicable Margin. Such interest shall be payable for each calendar
month on the first day of the next calendar month. Any overdue principal of and,
to the extent permitted by applicable law, overdue interest on any Base Rate
Loan shall bear interest, payable on demand, for each day until paid at a rate
per annum equal to the Default Rate.
(c) Each Euro-Dollar Loan shall bear interest on the
outstanding principal amount thereof, for the Interest Period applicable
thereto, at a rate per annum equal to the sum of the Applicable Margin plus the
applicable Adjusted London Interbank Offered Rate for such Interest Period. Such
interest shall be payable for each Interest Period on the last day thereof
38
and, if such Interest Period is 6 months or longer, also 3 months after the
first day of the next calendar month. Upon the occurrence and during the
continuation of an Event of Default, interest shall be payable monthly. Any
overdue principal of and, to the extent permitted by law, overdue interest on
any Euro-Dollar Loan shall bear interest, payable on demand, for each day until
paid at a rate per annum equal to the Default Rate.
(d) The Agent shall determine each interest rate
applicable to the Loans hereunder. The Agent shall give prompt notice to the
Borrowers and the Lenders by telecopier of each rate of interest so determined,
and its determination thereof shall be conclusive in the absence of manifest
error.
(e) After the occurrence and during the continuance of an
Event of Default, the principal amount of the Loans (and, to the extent
permitted by applicable law, all accrued interest thereon) may, at the election
of the Required Lenders, bear interest at the Default Rate from the date of such
Event of Default (which date with respect to SECTION 5.19 shall be deemed to
occur on the date such Event of Default occurred, not the date of delivery of
the Compliance Certificate).
SECTION 2.07. Fees.
(a) The Borrowers shall pay to the Agent, for the ratable
account of each Lender, the Unused Line Fee. Such Unused Line Fee shall accrue
from and including the Closing Date to but excluding the Termination Date and
shall be payable on the last Business Day of each calendar quarter and on the
Termination Date.
(b) The Borrowers shall pay to the Agent, for the ratable
account of each Lender, an up-front fee in an amount based upon each Lender's
original commitment amount as follows: (i) .75% for commitments of $25,000,000
or more; and (ii) .50% for commitments under $25,000,000; such up-front fees
shall be calculated by multiplying each Lender's Commitment as of the Closing
Date times the applicable percentage based upon such Lender's original
commitment and shall be payable on the Closing Date.
(c) The Borrowers shall pay to the Agent, for the account
and sole benefit of the Agent and the Arranger, as applicable, such fees and
other amounts at such times as set forth in the Fee Letter.
SECTION 2.08. Optional Termination or Reduction of
Commitments. The Borrowers may, upon at least 45 days' prior written notice to
the Agent, terminate the Commitments in their entirety at any time, or upon at
least 3 Domestic Business Days' prior written notice to the Agent,
proportionately reduce the Unused Commitments from time to time by an aggregate
amount of at least $5,000,000 or any larger integral multiple of $1,000,000, so
long as such reduction shall not cause the Aggregate Commitments to be reduced
below $50,000,000 (unless terminated in their entirety). If the Commitments are
terminated in their entirety, all accrued fees (as provided under SECTION 2.07)
shall be due and payable on the effective date of such termination and the
Parent shall pledge in favor of the Agent cash collateral equal to the sum of
(i) at least 110% of the outstanding Letter of Credit Obligations, if
39
any, and (ii) 100% of the principal amount of Interest Rate Protection
Agreements up to the amount set forth in clause (c) of the definition of
Obligations.
SECTION 2.09. Mandatory Reduction and Termination of
Commitments. The Commitments shall terminate on the Termination Date and any
Loans then outstanding (together with accrued interest thereon) shall be due and
payable on such date and the Parent shall pledge in favor of the Agent cash
collateral equal to the sum of (i) at least 110% of the outstanding Letter of
Credit Obligations, if any, and (ii) 100% of the principal amount of Interest
Rate Protection Agreements up to the amount set forth in clause (c) of the
definition of Obligations.
SECTION 2.10. Optional Prepayments.
(a) Upon notice to the Agent prior to 11:00 A.M.
(Charlotte, North Carolina, time) on the same Domestic Business Day, the
Borrowers may prepay any Borrowing which is a Base Rate Borrowing in whole at
any time, or from time to time in part in amounts aggregating at least $500,000,
by paying the principal amount to be prepaid together with accrued interest
thereon to the date of prepayment. Each such optional prepayment shall be
applied to prepay ratably the Base Rate Loans of the several Lenders included in
such Base Rate Borrowing.
(b) Upon notice to the Agent prior to 11:00 A.M.
(Charlotte, North Carolina, time) 3 Euro-Dollar Business Days before such
prepayment, the Borrowers may prepay any Borrowing which is a Euro-Dollar
Borrowing in whole at any time, or from time to time in part in minimum amounts
of $5,000,000 with additional increments of $1,000,000, by paying the principal
amount to be prepaid together with accrued interest thereon to the date of
prepayment. Each such optional prepayment shall be applied to prepay ratably the
Euro-Dollar Loans of the several Lenders included in such Euro-Dollar Borrowing.
Euro-Dollar Borrowings may be prepaid before the end of the Interest Period
applicable to such Loans, provided that such prepayments are subject to any
compensation payments required by SECTION 8.05, unless the amount of such
prepayment is deposited with the Agent as cash collateral to secure the
Obligations with the direction and authorization given to the Agent to apply
such cash collateral toward payment of such Euro-Dollar Loan at the end of such
Euro-Dollar Loan's Interest Period.
(c) Upon receipt of a notice of prepayment pursuant to
this SECTION 2.10, the Agent shall promptly notify each Lender of the contents
thereof and of such Lender's ratable share of such prepayment (except with
respect to Settlement Loans, unless the Lenders have purchased interests therein
pursuant to SECTION 2.01(b)) and such notice, once received by the Agent, shall
not thereafter be revocable by the Borrowers.
(d) In the event that any Loan is prepaid on the same day
such Loan was advanced, interest hereunder on such Loan shall be due and payable
for that day.
SECTION 2.11. Mandatory Prepayments.
(a) On each date on which the Commitments are reduced
pursuant to SECTION 2.08, the Borrowers shall repay or prepay such principal
amount of the outstanding Revolving Loans, if any (together with interest
accrued thereon and any amount due under SECTION 8.05(a)), as may be necessary
so that after such payment the aggregate unpaid amount
40
of the Working Capital Obligations does not exceed the aggregate amount of the
Commitments as then reduced.
(b) On each date on which the Working Capital Obligations
exceed the Borrowing Base, except as a result of an Overadvance Loan, the
Borrowers shall immediately repay or prepay such principal amount of the
outstanding Revolving Loans, if any (together with interest accrued thereon and
any amount due under SECTION 8.05(a)), as may be necessary so that after such
payment the Working Capital Obligations do not exceed the Borrowing Base;
provided that, if the Working Capital Obligations remain in excess of the
Borrowing Base after all Revolving Loans have been repaid or prepaid, the
Borrowers shall immediately post cash collateral with the Agent against the
Letter of Credit Obligations in such amount as is necessary so that the Letter
of Credit Obligations, less the amount of such cash collateral is less than or
equal to the Borrowing Base. Each such payment or prepayment of Revolving Loans
shall be applied ratably to the Revolving Loans of the Lenders outstanding on
the date of payment or prepayment in the following order of priority: (i) first,
to Settlement Loans; (ii) secondly, to Base Rate Loans which are not Settlement
Loans; and, (iii) lastly, to Euro-Dollar Loans.
SECTION 2.12. General Provisions as to Payments.
(a) The Borrowers shall make each payment of principal
of, and interest on, the Loans and of fees hereunder, without any setoff,
counterclaim or any deduction whatsoever, not later than 11:00 A.M. (Charlotte,
North Carolina, time) on the date when due, in Federal or other funds
immediately available in Charlotte, North Carolina, to the Agent at its address
referred to in SECTION 10.01. All payments received by the Agent after 11:00
A.M. (Charlotte, North Carolina, time) on any Business Day shall be deemed to be
received on the following Business Day. The Agent will promptly distribute to
each Lender its ratable share of each such payment received by the Agent for the
account of the Lenders.
(b) Whenever any payment of principal of, or interest on,
the Base Rate Loans or of fees hereunder shall be due on a day which is not a
Domestic Business Day, the date for payment thereof shall be extended to the
next succeeding Domestic Business Day. Whenever any payment of principal of, or
interest on, the Euro-Dollar Loans shall be due on a day which is not a
Euro-Dollar Business Day, the date for payment thereof shall be extended to the
next succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day
falls in another calendar month, in which case the date for payment thereof
shall be the next preceding Euro-Dollar Business Day.
(c) All payments of principal, interest and fees and all
other amounts to be made by the Borrowers with respect to the Obligations or
otherwise (including, without limitation, with respect to the Letter of Credit
Obligations) pursuant to this Agreement shall be paid without deduction for, and
free from, any tax, imposts, levies, duties, deductions, or withholdings of any
nature now or at anytime hereafter imposed by any governmental authority or by
any taxing authority thereof or therein excluding in the case of each Lender,
taxes imposed on or measured by its net income, and franchise taxes imposed on
it, by the jurisdiction under the laws of which such Lender is organized or any
political subdivision thereof and, in the case of each Lender, taxes imposed on
or measured by its income, and franchise taxes imposed on it, by the
jurisdiction of such Lender's applicable Lending Office or any political
subdivision thereof
41
(all such non- excluded taxes, imposts, levies, duties, deductions or
withholdings of any nature being "Taxes"). In the event that the Borrowers are
required by applicable law to make any such withholding or deduction of Taxes
with respect to any of the Obligations, the Borrowers shall pay such deduction
or withholding to the applicable taxing authority, shall promptly furnish to any
Lender in respect of which such deduction or withholding is made all receipts
and other documents evidencing such payment and shall pay to such Lender
additional amounts as may be necessary so that the amount received by such
Lender after the required withholding or other payment shall equal the amount
such Lender would have received had no such withholding or other payment been
made. If no withholding or deduction of Taxes are payable in respect to any
Obligations, the Borrowers shall furnish any Lender, at such Lender's reasonable
request, a certificate from each applicable taxing authority or an opinion of
counsel acceptable to such Lender, in either case stating that such payments are
exempt from or not subject to withholding or deduction of Taxes. If the
Borrowers fail to provide such original or certified copy of a receipt
evidencing payment of Taxes or certificate(s) or opinion of counsel of
exemption, the Borrowers hereby agree to compensate such Lender for, and
indemnify them with respect to, the tax consequences of the Borrowers' failure
to provide evidence of tax payments or tax exemption. Before making any claim
pursuant to this SECTION 2.12(c), such Lender shall designate a different
Lending Office if such designation will avoid the need for giving such notice
and will not, in the reasonable judgment of such Lender, be otherwise
disadvantageous to such Lender.
(d) Each Lender which is not organized under the laws of
the United States or any state thereof agrees, as soon as practicable after
receipt by it of a request by the Borrowers to do so, to file all appropriate
forms and take other appropriate action to obtain a certificate or other
appropriate document from the appropriate governmental authority in the
jurisdiction imposing the relevant Taxes, establishing that it is entitled to
receive payments with respect to the Obligations and interest thereon under this
Agreement and the Notes without deduction and free from withholding of any Taxes
imposed by such jurisdiction; provided that if it is unable, for any reason, to
establish such exemption, or to file such forms and, in any event, during such
period of time as such request for exemption is pending, the Borrowers shall
nonetheless remain obligated under the terms of the immediately preceding
paragraph.
(e) In the event any Lender receives a refund of any
Taxes paid by the Borrowers pursuant to this SECTION 2.12, it will pay to the
Borrowers the amount of such refund promptly upon receipt thereof; provided that
if at any time thereafter it is required to return such refund, the Borrowers
shall promptly repay to it the amount of such refund.
(f) Without prejudice to the survival of any other
agreement of the Borrowers hereunder, the agreements and obligations of the
Borrowers and the Lenders contained in this SECTION 2.12 shall be applicable
with respect to any Participant, Assignee or other Transferee, and any
calculations required by such provisions shall (i) be made based upon the
circumstances of such Participant, Assignee or other Transferee, and (ii)
constitute a continuing agreement and survive the termination of this Agreement
and the payment in full or cancellation of the Notes.
(g) Prior to the existence of an Event of Default and
application of monies pursuant to SECTION 2.12(h), all payments made by the
Borrowers in payment of the Obligations shall be allocated among the Agent and
such of the Lenders as are entitled thereto
42
(and, with respect to monies allocated to the Lenders in accordance with their
Commitment Percentage unless otherwise provided herein) as specified by the
Borrowers; provided, however, that during such time that the provisions of
SECTION 2.15(a)(ii) are applicable, they shall be applied in the following
order, except to the extent SECTION 2.11(b) is applicable (in each case, until
all Obligations within each category itemized in this paragraph (g) below are
fully paid):
(i) first, to the Agent for the benefit of the
Lenders in payment of accrued interest then due and payable in
respect of the Loans;
(ii) second, to Wachovia toward payment of
principal of Settlement Loans then due and payable;
(iii) third, ratably, to payment of principal of
(A) the Loans, (B) any obligations owing to any Lender with
respect to any Interest Rate Protection Agreements up to the
amount set forth in clause (c) of the definition of
Obligations and (C) any obligations owing to any Lender with
respect to any ForEx Obligations, in any event with respect to
(A), (B) or (C) to the extent then due and payable;
(iv) fourth, to the Lenders for any amounts then
owed by the Borrowers under indemnification obligations under
the Credit Documents that the Lenders have paid to the Agent
and, with respect to any expenses under the Credit Documents,
that the Lenders have reimbursed to the Agent;
(v) fifth, to the Agent to pay any amounts then
owed by the Borrowers under indemnification obligations under
the Credit Documents that have not been paid to the Agent by
the Lenders or the Borrowers, together with interest accrued
thereon;
(vi) sixth, to the Agent to pay any fees then due
and payable to Agent;
(vii) seventh, to the Agent first, and then to the
Lenders, to pay the amount of expenses that have not been
reimbursed, respectively, to the Agent or the Lenders by the
Borrowers (or the other Lenders, as applicable) in accordance
with the terms of this Agreement, together with any interest
accrued thereon;
(viii) eighth, to the payment of Fees then payable
(A) first with respect to any outstanding Letter of Credit
Obligations then due and owing, then (B) second with respect
to ForEx Obligations;
(ix) ninth, to payment of the Reimbursement
Obligations and Special Foreign Guarantees then due and
payable;
(x) tenth, to the Lenders in payment of accrued
interest then due and payable in respect of any Obligations
other than the Loans then outstanding; and
(xi) lastly, to any other Obligations then due
and payable.
43
(h) During the existence of an Event of Default and at
all times thereafter that the Obligations have become due and payable, all
monies to be applied to the Obligations, whether such monies represent voluntary
payments by the Borrowers or are received pursuant to acceleration of the Loans
or realized from any disposition of Collateral, shall be allocated among the
Agent and such of the Lenders as are entitled thereto (and, with respect to
monies allocated to the Lenders in accordance with their Commitment Percentage
unless otherwise provided herein) in the following order (in each case, until
all Obligations within each category itemized in this paragraph (h) below are
fully paid):
(i) first, to the Agent to pay principal and
accrued interest on any portion of the Revolving Loans which
Agent may have advanced on behalf of any Lenders and for which
Agent has not been reimbursed by such Lender or the Borrowers;
(ii) second, to Wachovia to pay the principal and
accrued interest on any portion of the Settlement Loans
outstanding;
(iii) third, to the Agent first, and then to the
Lenders, to pay the amount of expenses that have not been
reimbursed, respectively, to the Agent or the Lenders by the
Borrowers (or the other Lenders, as applicable) in accordance
with the terms of this Agreement, together with any interest
accrued thereon;
(iv) fourth, to the Agent to pay any amounts owed
under indemnification obligations that have not been paid to
Agent by the Lenders or the Borrowers, together with interest
accrued thereon;
(v) fifth, to the Agent to pay any fees due and
payable to Agent;
(vi) sixth, to the Lenders for any amounts owed
under indemnification obligations that they have paid to the
Agent and for any expenses that they have reimbursed to the
Agent;
(vii) seventh, to the payment of Fees payable (A)
first with respect to Letter of Credit Obligations, then (B)
second with respect to ForEx Obligations;
(viii) eighth, as cash collateral for any Letter of
Credit Obligations equal to 110% of the undrawn amount
thereof;
(ix) ninth, to payment of the Reimbursement
Obligations and Special Foreign Guarantees;
(x) tenth, to the Lenders in payment of accrued
interest then due and payable in respect of the Loans and any
other Obligations then outstanding;
(xi) eleventh,ratably, to payment of principal of
(A) the Loans and (B) any obligations owing to any Lender with
respect to any Interest Rate Protection Agreements up to the
amount set forth in clause (c) of the definition of
44
Obligations, and (C) any obligations owing to any Lender with
respect to any ForEx Obligations; and
(xii) lastly, to any other Obligations then due
and payable. The allocations set forth in this SECTION 2.12(h)
are solely to determine the rights and priorities of Agent and
Lenders as among themselves and may be changed by Agent and
Lenders without notice to or the consent or approval of the
Borrowers or any other Person.
(i) The Borrowers hereby authorize and directs the Agent
in the event that Borrowers have not timely made payment thereto, and each
Lender hereby authorizes and directs the Agent, to advance Revolving Loans (pro
rata for each Lender) for the amount due when the same becomes due (whether on a
Domestic Business Day or on a day which is not a Domestic Business Day) with
respect to any interest or fees on any of the Loans, subject to the terms and
conditions of this Agreement; provided, however, in no event shall the Agent be
obligated to make any such Loans at any time, and the Borrowers agree that they
remain obligated to make any such payments when due; provided, further, that the
Agent will promptly notify the Borrowers in the event the Agent does not make
any such payments of interest or fees by advancing Revolving Loans, unless the
Agent has notified the Borrowers that the Agent will no longer make such
advances of Revolving Loans for the payment of interest and fees on any of the
Loans. Unless the Agent shall have received a Notice of Borrowing on a timely
basis prior to any such due date requesting a Euro-Dollar Loan, subject to the
terms of this Agreement, any Loan advanced by the Agent under this SECTION
2.12(i) shall be advanced as a Base Rate Loan
SECTION 2.13. Computation of Interest and Fees. Interest on
Base Rate Loans will be computed on the basis of a year of 360 days and paid for
the actual number of days elapsed (including the first day but excluding the
last day). Interest on Euro-Dollar Loans will be computed on the basis of a year
of 360 days and paid for the actual number of days elapsed, calculated as to
each Interest Period from and including the first day thereof to but excluding
the last day thereof. Unused Line Fees and any other fees payable hereunder
shall be computed on the basis of a year of 360 days and paid for the actual
number of days elapsed (including the first day but excluding the last day).
SECTION 2.14. All Loans to Constitute One Obligation. The
Loans shall constitute one general Obligation of the Borrowers, on which each
Borrower is jointly and severally liable, and shall be secured by the Liens on
the Collateral in favor of the Agent; provided, however, that the Agent and each
of the Lenders shall be deemed to be a creditor of each Borrower and the holder
of a separate claim against each Borrower to the extent of all Obligations
jointly and severally owed by the Borrowers to the Agent or such Lender.
SECTION 2.15. Lockbox; Collateral Reserve Accounts; Control
Agreements.
(a)
(i) Simultaneously herewith, each Borrower and
Guarantor (except to the extent that and for so long as the
Agent has notified such Guarantor that the Agent has
determined that, based on the types of assets of such
Guarantor,
45
compliance with this SECTION 2.15(a) will be suspended as to
such Guarantor until notice to the contrary by the Agent)
shall establish and continually maintain with the Agent one or
more Collateral Reserve Accounts and it and the Agent shall
execute Deposit Account Control Agreements with all depositary
banks located in the United States other than Wachovia (so
that all such banks become Approved Depositaries) into which
is deposited (except into deposit accounts excluded from the
definition of "Deposit Accounts") all cash, checks, drafts,
items and other Instruments for the payment of money which it
now has or may at any time hereafter receive in full or
partial payment for the Inventory, payment on any of the
Borrowers' or Guarantors' Accounts, Chattel Paper, or General
Intangibles, or as proceeds of the Borrowers' or Guarantors'
Inventory, Accounts, Chattel Paper, or General Intangibles. In
addition, each Borrower and Guarantor receiving Net
Casualty/Insurance Proceeds shall (or shall cause such other
Person receiving such cash proceeds to) remit all such cash
proceeds to Wachovia, if required pursuant to SECTION 5.08(b).
In the event such items of payment are inadvertently received
by any of the Borrowers or Guarantors or any other Person,
whether or not in accordance with the terms of this Agreement,
such Borrower, Guarantor or other Person shall be deemed to
hold the same in trust for the benefit of Agent and promptly
forward them to Wachovia or other Approved Depositary. Subject
to the provisions of clauses (ii) and (iii) below, the Agent
will not issue any instructions or other directions to any
Approved Depositary directing disposition of funds in any
Collateral Reserve Account, and the Borrowers shall have
complete control over any and all funds held by Approved
Depositaries and the exclusive right to direct the disposition
of the funds therein notwithstanding any other provision in
any Deposit Account Control Agreement or any other Credit
Document to the contrary (subject to the underlying agreements
establishing and governing such accounts with Wachovia or
other such Approved Depositary, as the case may be).
(ii) If at any time Excess Borrowing Availability
is less than $25,000,000, the provisions of this clause (ii)
shall become applicable and shall be maintained thereafter,
regardless of subsequent changes in Excess Borrowing
Availability above $25,000,000. Promptly upon Excess Borrowing
Availability becoming less than $25,000,000, each Borrower and
Guarantor will open a lockbox with the Agent (or at the option
of the Agent, the Agent shall be given exclusive control of
the existing lockbox or lockboxes) and the Agent shall notify
Wachovia and all other Approved Depositaries to remit balances
in deposit accounts maintained by them to the Agent. The Agent
will remove from such lockboxes and deposit all such items of
payment received from Account Debtors and all amounts received
from Approved Depositaries into a Collateral Reserve Account
promptly upon receipt, and, subject to clause (iii) below, the
Agent shall apply the proceeds from such items of payment
against the Base Rate Loans then due and payable first, then
the Euro-Dollar Loans then due and payable, then otherwise in
accordance with the proviso contained in SECTION 2.12(g)
(except that cash collateral for Letter of Credit Obligations
shall not be required unless an Event of Default has occurred
and is continuing), with any remaining collected amounts in
each Collateral Reserve Account being transferred by the Agent
on
46
each Domestic Business Day to the Borrowers' operating
accounts with respect to which the Borrowers shall have the
exclusive right to direct the disposition of the funds therein
notwithstanding any other provision in any Deposit Account
Control Agreement or any other Credit Document to the contrary
(subject to the underlying agreements establishing and
governing such operating accounts with Wachovia or other
Approved Depositary, as the case may be); provided, that Net
Casualty/Insurance Proceeds shall be held subject to the
provisions of SECTION 5.08(b), and any Net Casualty/Insurance
Proceeds not required to be paid to the Agent for the account
of the Lenders pursuant to SECTION 5.08(b) shall be paid to or
retained by the Borrowers.
(iii) During the existence of an Event of Default
the Agent may at any time in its commercially reasonable
judgment or if requested in writing by the Required Lenders,
direct Account Debtors to make payments on the Borrowers' and
Guarantors' Accounts, Chattel Paper, or General Intangibles,
or portions thereof, directly to the Agent, and the Account
Debtors are hereby authorized and directed to do so by the
Borrowers and each Guarantor upon the Agent's direction, and
the funds so received shall be also deposited in a Collateral
Reserve Account, and all amounts in a Collateral Reserve
Account shall be subject to the provisions of SECTION 2.12(h).
(b) The Borrowers and Guarantors shall not open any
Deposit Account with any depositary institution (except with the Agent and
subject to the Liens created by this Agreement) unless the depository
institution constitutes an Approved Depositary and it shall have entered into a
Deposit Account Control Agreement with the Agent. As of the Closing Date, the
Borrowers and Guarantors have no Deposit Accounts other than those listed in the
Collateral Disclosure Certificates.
(c) The Borrowers and Guarantors shall not open any
securities account with any securities intermediary (except with the Agent and
subject to the Liens created by this Agreement) unless the securities
intermediary constitutes an Approved Securities Intermediary and it shall have
entered into a Securities Account Control Agreement with the Agent. As of the
Closing Date, the Borrowers and Guarantors have no securities accounts other
than those listed in the Collateral Disclosure Certificates. Notwithstanding any
other provision in any Securities Account Control Agreement or any other Credit
Document to the contrary but without limiting Agent's rights hereunder during
the existence of an Event of Default, before such time (if any) that the
provisions of SECTION 2.15(a)(ii) are applicable, (a) the Agent will not issue
any entitlement orders or other instructions to any Approved Securities
Intermediary concerning any such securities account, and (b) the Borrowers shall
have complete control over any and all amounts held by Approved Securities
Intermediaries and the exclusive right to direct the disposition of the funds
and other investment property in such securities accounts. After such time that
the provisions of SECTION 2.15(a)(ii) become applicable, Agent may issue
entitlement orders directing withdrawals of amounts in such securities accounts,
but only to the extent transferred to a Collateral Reserve Account to the extent
necessary to cover obligations then due and payable to the Agent or the Lenders
as provided by SECTION 2.15(a)(ii).
47
SECTION 2.16. Issuance of Letters of Credit. Upon satisfaction
of the conditions set forth in SECTION 9.01, the Existing Letters of Credit
shall for all purposes be deemed to have been issued pursuant to this Agreement
(except without regard to SECTION 2.17 and SECTION 2.18) and shall constitute
Letters of Credit hereunder. Subject to the terms and conditions of this
Agreement, and in reliance upon the representations and warranties of the
Borrowers and Guarantors herein set forth, the LC Issuer shall issue for the
account of Borrowers, upon request by the relevant Borrower pursuant hereto, one
or more Letters of Credit denominated in Dollars, in accordance with this
ARTICLE 2, from time to time during the period commencing on the Closing Date
and ending on the Domestic Business Day prior to the Termination Date.
SECTION 2.17. Conditions and Amounts of Letters of Credit. The
LC Issuer shall have no obligation to issue any Letter of Credit:
(a) if the aggregate maximum amount then available for
drawing under Letters of Credit, after giving effect to the issuance of the
requested Letter of Credit, shall exceed any limit imposed by law or regulation
upon the LC Issuer;
(b) if, after giving effect to the issuance of the
requested Letter of Credit, (i) the aggregate Letter of Credit Obligations would
exceed $20,000,000 or (ii) all of the then outstanding Working Capital
Obligations would exceed the Borrowing Base;
(c) which has an expiration date (i) more than 364 days
after the date of issuance or (ii) after the Termination Date;
(d) unless the relevant Borrower shall have delivered to
the LC Issuer at such times and in such manner as the LC Issuer may prescribe, a
Letter of Credit Application Agreement and such other documents and materials as
may be required pursuant to the terms thereof all satisfactory in form and
substance to the LC Issuer and the terms of the proposed Letter of Credit shall
be satisfactory in form and substance to the LC Issuer;
(e) if, as of the date of issuance of the requested
Letter of Credit, any order, judgment or decree of any court, arbitrator or
Authority shall purport by its terms to enjoin or restrain the LC Issuer from
issuing such Letter of Credit and any law, rule or regulation applicable to the
LC Issuer or any request or directive (whether or not having the force of law)
from any Authority with jurisdiction over the LC Issuer shall prohibit or
request that the LC Issuer refrain from the issuance of letters of credit
generally or the issuance of that Letter of Credit; or
(f) if the Unused Commitment shall be less than the
amount of the requested Letter of Credit.
SECTION 2.18. Requests for Issuance of Letters of Credit.
(a) Request for Issuance. At least two Domestic Business
Days before the effective date of issuance for any Letter of Credit, the
relevant Borrower shall give the LC Issuer a written notice containing the
original signature of an authorized officer or employee of such Borrower
substantially in the form of EXHIBIT P-1. Such notice shall be irrevocable and
shall
48
specify the original face amount of the Letter of Credit requested (which
original face amount shall not be less than $100,000), the effective date (which
day shall be a Domestic Business Day) of issuance of such requested Letter of
Credit, the date on which such requested Letter of Credit is to expire, the
amount of then outstanding Letter of Credit Obligations, the purpose for which
such Letter of Credit is to be issued, whether such Letter of Credit may be
drawn in single or partial draws and the person for whose benefit the requested
Letter of Credit is to be issued.
(b) Issuance; Notice of Issuance. If the original face
amount of the requested Letter of Credit is less than or equal to the Unused
Commitment at such time and the applicable conditions set forth in this
Agreement are satisfied, the LC Issuer shall issue the requested Letter of
Credit. The LC Issuer shall give each Lender written or telex notice in
substantially the form of EXHIBIT P-2, or telephonic notice confirmed promptly
thereafter in writing, of the issuance of a Letter of Credit.
(c) No Extension or Amendment. The LC Issuer shall not
extend or amend any Letter of Credit if the issuance of a new Letter of Credit
having the same terms as such Letter of Credit as so amended or extended would
be prohibited by SECTION 2.17 or SECTION 2.18.
SECTION 2.19. Letter of Credit Reimbursement Obligations;
Duties of the LC Issuer.
(a) Reimbursement. Notwithstanding any provisions to the
contrary in any Letter of Credit Application Agreement:
(i) the relevant Borrower shall reimburse the LC
Issuer for drawings under a Letter of Credit issued by it no
later than the earlier of (A) the time specified in such
Letter of Credit Application Agreement, or (B) 1 Domestic
Business Day after the payment by the LC Issuer of such
drawing;
(ii) any Reimbursement Obligation with respect to
any Letter of Credit shall bear interest from the date of the
relevant drawing under the pertinent Letter of Credit until
the date of payment in full thereof at a rate per annum equal
to (A) prior to the date that is 3 Domestic Business Days
after the date of the related payment by the LC Issuer, the
Base Rate and (B) thereafter, the Default Rate; and
(iii) to implement the foregoing, upon the
occurrence of a draw under any Letter of Credit, unless the LC
Issuer is reimbursed in accordance with subsection (i) above,
the Borrowers irrevocably authorize the Agent to treat such
nonpayment as a Notice of Borrowing in the amount of such
Reimbursement Obligation to the extent not repaid (except to
the extent the Borrowers have otherwise requested a Borrowing
pursuant hereto) and to make Revolving Loans to the Borrowers
in such amount regardless of whether the conditions precedent
to the making of Revolving Loans hereunder have been met. Each
Borrower further authorizes the Agent to credit the proceeds
of such Revolving Loans so as to immediately eliminate the
liability of the relevant Borrower for Reimbursement
Obligations under such Letter of Credit.
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(b) Duties of the LC Issuer. Any action taken or omitted
to be taken by the LC Issuer in connection with any Letter of Credit, if taken
or omitted in the absence of willful misconduct or gross negligence, shall not
put the LC Issuer under any resulting liability to any Lender, or assuming that
the LC Issuer has complied with the procedures specified in SECTION 2.18 and
such Lender has not given a notice contemplated by SECTION 2.20(a) that
continues in full force and effect, relieve that Lender of its obligations
hereunder to the LC Issuer. In determining whether to pay under any Letter of
Credit, the LC Issuer shall have no obligation relative to the Agent or the
Lenders other than to confirm that any documents required to have been delivered
under such Letter of Credit appear to comply on their face with the requirements
of such Letter of Credit.
SECTION 2.20. Letter of Credit Participations.
(a) Purchase of Participations. Immediately upon issuance
of any Letter of Credit in accordance with the procedures set forth in SECTION
2.17, each Lender shall be deemed to have irrevocably and unconditionally
purchased and received from the LC Issuer, without recourse or warranty, an
undivided interest and participation, to the extent of such Lender's Commitment
Percentage of such Letter of Credit (or guaranty pertaining thereto); provided,
that a Letter of Credit shall not be entitled to the benefits of this SECTION
2.20 if the Agent and the LC Issuer shall have received written notice from any
Lender on or before the Domestic Business Day immediately prior to the date of
the LC Issuer's issuance of such Letter of Credit that one or more of the
conditions contained in SECTION 2.17 or ARTICLE 9 is not then satisfied, and, in
the event the Agent and the LC Issuer receives such a notice, it shall have no
further obligation to issue any Letter of Credit until such notice is withdrawn
by that Lender or until the Required Lenders have effectively waived such
condition in accordance with the provisions of this Agreement.
(b) Sharing of Letter of Credit Payments. In the event
that the LC Issuer makes any payment under any Letter of Credit for which the
applicable Borrower shall not have repaid such amount to the LC Issuer pursuant
to SECTION 2.19 or which cannot be paid by a Revolving Loan pursuant to SECTION
2.19(a)(iii), the LC Issuer shall notify the Agent and the Agent shall promptly
notify each Lender of such failure, and each Lender shall promptly and
unconditionally pay to the LC Issuer such Lender's Commitment Percentage of the
amount of such payment in Dollars and in same day funds. If the Agent so
notifies such Lender prior to 10:00 A.M. (Charlotte, North Carolina, time) on
any Domestic Business Day, such Lender shall make available to the LC Issuer its
Commitment Percentage of the amount of such payment on such Domestic Business
Day in same day funds. If and to the extent such Lender shall not have so made
its Commitment Percentage of the amount of such payment available to the LC
Issuer, such Lender agrees to pay to the LC Issuer forthwith on demand such
amount together with interest thereon, for each day from the date such payment
was first due until the date such amount is paid to the LC Issuer at the Federal
Funds Rate for the first 3 days and thereafter at the Base Rate. The failure of
any Lender to make available to the LC Issuer its Commitment Percentage of any
such payment shall neither relieve nor increase the obligation of any other
Lender hereunder to make available to the LC Issuer its Commitment Percentage of
any payment on the date such payment is to be made.
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(c) Sharing of Reimbursement Obligation Payments.
Whenever the LC Issuer receives a payment on account of a Reimbursement
Obligation, including any interest thereon, as to which the LC Issuer has
received any payments from the Lenders pursuant to this SECTION 2.20, it shall
promptly pay to each Lender which has funded its participating interest therein,
in Dollars and in the kind of funds so received, an amount equal to such
Lender's Commitment Percentage thereof. Each such payment shall be made by the
LC Issuer on the Domestic Business Day on which the funds are paid to such
Person, if received prior to 10:00 am. (Charlotte, North Carolina, time) on such
Domestic Business Day, and otherwise on the next succeeding Domestic Business
Day.
(d) Documentation. Upon the request of any Lender, the LC
Issuer shall furnish to such Lender copies of any Letter of Credit, Letter of
Credit Application Agreement and other documentation relating to Letters of
Credit issued pursuant to this Agreement.
(e) Obligations Irrevocable. The obligations of the
Lenders to make payments to the LC Issuer with respect to a Letter of Credit
shall be irrevocable, not subject to any qualification or exception whatsoever
and shall be made in accordance with, but not subject to, the terms and
conditions of this Agreement under all circumstances (assuming that the LC
Issuer has issued such Letter of Credit in accordance with SECTION 2.18 and such
Lender has not given a notice contemplated by SECTION 2.20(a) that continues in
full force and effect), including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of
this Agreement or any of the other Credit Documents;
(ii) the existence of any claim, set-off, defense
or other right which the Borrowers may have at any time
against a beneficiary named in a Letter of Credit or any
transferee of any Letter of Credit (or any Person for whom any
such transferee may be acting), the LC Issuer, any Lender or
any other Person, whether in connection with this Agreement,
any Letter of Credit, the transactions contemplated herein or
any unrelated transactions;
(iii) any draft, certificate or any other document
presented under the Letter of Credit proves to be forged,
fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect;
(iv) the surrender or impairment of any security
for the performance or observance of any of the terms of any
of the Credit Documents;
(v) payment by the LC Issuer under any Letter of
Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement in any Letter of
Credit being untrue or inaccurate in any respect;
(vi) payment by the LC Issuer under any Letter of
Credit against presentation of any draft or certificate that
does not comply with the terms of such Letter of Credit,
except payment resulting from the gross negligence or willful
misconduct of the LC Issuer; or
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(vii) any other circumstances or happenings
whatsoever, whether or not similar to any of the foregoing;
except with respect to clauses (i) through (vii) above where circumstances or
happenings result from the gross negligence or willful misconduct of the LC
Issuer.
SECTION 2.21. Payment of Letter of Credit Reimbursement
Obligations.
(a) Payments to the LC Issuer. The relevant Borrower
agrees to pay to the LC Issuer the amount of all Reimbursement Obligations,
interest and other amounts payable to the LC Issuer under or in connection with
any Letter of Credit issued for such Borrower's account immediately when due as
provided herein, irrespective of:
(i) any lack of validity or enforceability of
this Agreement or any of the other Credit Documents;
(ii) the existence of any claim, set-off, defense
or other right which the Borrower may have at any time against
a beneficiary named in a Letter of Credit or any transferee of
any Letter of Credit (or any Person for whom any such
transferee may be acting), the LC Issuer, the Agent, any
Lender or any other Person, whether in connection with this
Agreement, any Letter of Credit, the transactions contemplated
herein or any unrelated transactions;
(iii) any draft, certificate or any other document
presented under the Letter of Credit proves to be forged,
fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect;
(iv) the surrender or impairment of any security
for the performance or observance of any of the terms of any
of the Credit Documents;
(v) payment by the LC Issuer under any Letter of
Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being
untrue or inaccurate in any respect;
(vi) payment by the LC Issuer under any Letter of
Credit against presentation of any draft or certificate that
does not comply with the terms of such Letter of Credit,
except payment resulting from the gross negligence or willful
misconduct of the LC Issuer; or
(vii) any other circumstances or happenings
whatsoever, whether or not similar to any of the foregoing;
except with respect to clauses (i) through (vii) above where circumstances or
happenings result from the gross negligence or willful misconduct of the LC
Issuer.
(b) Recovery or Avoidance of Payments. In the event any
payment by or on behalf of the relevant Borrower received by the LC Issuer with
respect to a Letter of Credit and distributed by the LC Issuer to the Lenders on
account of their participations is thereafter set
52
aside, avoided or recovered from the LC Issuer in connection with any
receivership, liquidation or bankruptcy proceeding, each Lender that received
such distribution shall, upon demand by the LC Issuer, contribute such Lender's
Commitment Percentage of the amount set aside, avoided or recovered together
with interest at the rate required to be paid by the LC Issuer upon the amount
required to be repaid by it.
SECTION 2.22. Compensation for Letters of Credit and Reporting
Requirements.
(a) Letter of Credit Commitment Fees. The relevant
Borrower shall pay to the Agent with respect to all Letters of Credit issued
hereunder a Letter of Credit Commitment Fee. Such Letter of Credit Commitment
Fee shall accrue from and including the Closing Date to but excluding the
Termination Date and shall be payable on the last Business Day of each calendar
quarter and on the Termination Date. Letter of Credit Commitment Fees payable
hereunder shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day). The Agent shall promptly remit such Letter of Credit Commitment Fees, when
paid, to the Lenders in accordance with their Commitment Percentage thereof.
(b) Letter of Credit Fronting Fee. Each Borrower shall
pay to the Agent with respect to each Letter of Credit issued hereunder a Letter
of Credit Fronting Fee, payable on the Domestic Business Day on which such
Letter of Credit is issued, solely for the account of the LC Issuer. The Agent
shall promptly remit such Letter of Credit Fronting Fees, when paid, to the LC
Issuer.
(c) LC Issuer Charges. Each Borrower shall pay to the LC
Issuer, solely for its own account, the standard charges assessed by the LC
Issuer in connection with the issuance, administration, amendment and payment or
cancellation of Letters of Credit issued hereunder, which charges shall be those
typically charged by the LC Issuer to its customers generally having credit and
other characteristics similar to the relevant Borrower, as determined in good
faith by the LC Issuer.
SECTION 2.23. Indemnification and Exoneration with respect to
Letters of Credit.
(a) Indemnification. In addition to amounts payable as
elsewhere provided in this Article 2, the Borrowers shall protect, indemnify,
pay and save the LC Issuer, the Agent and each Lender harmless from and against
any and all claims, demands, liabilities, damages, losses, costs, charges and
expenses (including reasonable attorneys' fees) which the LC Issuer, the Agent
or any Lender may incur or be subject to as a consequence of the issuance of any
Letter of Credit for a Borrower's account other than as a result of its gross
negligence or willful misconduct, as determined by a court of competent
jurisdiction.
(b) Assumption of Risk by the Borrowers. As between the
Borrowers, the LC Issuer, the Agent and the Lenders, the Borrowers assume all
risks of the acts and omissions of, or misuse of the Letters of Credit issued
for such Borrower's account by, the respective beneficiaries of such Letters of
Credit. In furtherance and not in limitation of the foregoing, the
53
LC Issuer, the Agent and the Lenders shall not be responsible for (i) except for
LC Issuer's obligation to examine the documents for conformity with the Letter
of Credit, the form, validity, sufficiency, accuracy, genuineness or legal
effect of any document submitted by any party in connection with the application
for and issuance of the Letters of Credit, even if it should in fact prove to be
in any or all respects invalid, insufficient, inaccurate, fraudulent or forged,
(ii) the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason, (iii) except as provided in clause (i)
above, failure of the beneficiary of a Letter of Credit to comply duly with
conditions required to draw upon such Letter of Credit, (iv) errors, omissions,
interruptions or delays in transmission or delivery of any messages, by mail,
cable, telegraph, telex or otherwise, whether or not they be in cipher, for
errors in interpretation of technical terms, (v) any loss or delay in the
transmission or otherwise of any document required to make a drawing under any
Letter of Credit or of the proceeds thereof, (vi) the misapplication by the
beneficiary of a Letter of Credit of the proceeds of any drawing under such
Letter of Credit; and (vii) any consequences arising from causes beyond the
control of the LC Issuer, the Agent and the Lenders.
(a) Exoneration. In furtherance and extension and not in
limitation of the specific provisions hereinabove set forth, any action taken or
omitted by the LC Issuer under or in connection with the Letters of Credit or
any related certificates if taken or omitted in good faith and with reasonable
care, shall not put the LC Issuer or any Lender under any resulting liability to
the Borrowers or relieve the Borrowers of any of their obligations hereunder to
any such Person.
(b) LC Issuer Reimbursement. Each Lender agrees to
reimburse the LC Issuer on demand, pro rata in accordance with its respective
Commitment Percentage, for (i) the reasonable out-of-pocket costs and expenses
of the LC Issuer to be reimbursed by the Borrowers under this Agreement or any
Letter of Credit Application Agreement or any Letter of Credit, to the extent
not reimbursed by the Borrowers and (ii) any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, fees, reasonable
out-of-pocket expenses or disbursements of any kind and nature whatsoever which
may be imposed on, incurred by or asserted against the LC Issuer in any way
relating to or arising out of this Agreement, any Letter of Credit, any
documentation or any transaction relating thereto, or any Letter of Credit
Application Agreement, to the extent not reimbursed by the Borrowers as required
by any Credit Document, except to the extent that such liabilities, losses,
costs or expenses were incurred by the LC Issuer as a result of the LC Issuer's
gross negligence or willful misconduct or by the LC Issuer's wrongful dishonor
of any Letter of Credit after the presentation to it by the beneficiary
thereunder of a draft or other demand for payment and other documentation
strictly complying with the terms and conditions of such Letter of Credit.
ARTICLE 3
COLLATERAL
SECTION 3.01. Grant of Security Interest. As security for the
payment of all Obligations, each Borrower and Guarantor (by execution and
delivery of the Guaranty) hereby grants, assigns, conveys, mortgages, pledges,
hypothecates and transfers to Agent, for itself and the ratable benefit of the
Lenders, a continuing, general lien upon and security interest and
54
security title in and to all of its right, title and interest in, to and under
all of its personal property and other assets other than Real Properties,
tangible personal property located outside of the United States and assets
excluded from the categories of assets listed below, whether now owned by or
owing to, or hereafter acquired by or arising in favor of such Borrower or
Guarantor (including under any trade names, styles or derivations thereof), and
whether owned or consigned by or to, or leased from or to, such Borrower or
Guarantor, and regardless of where located, including, without limitation:
(a) all Accounts;
(b) all Chattel Paper;
(c) all Documents;
(d) all General Intangibles;
(e) all Inventory;
(f) all Equipment;
(g) all Goods;
(h) all Instruments;
(i) all Investment Property;
(j) all Deposit Accounts;
(k) all money, cash, and cash equivalents (except to the
extent in deposit accounts excluded from the definition of "Deposit Accounts");
(l) all Supporting Obligations;
(m) all Letter of Credit Rights;
(n) all Commercial Tort Claims;
(o) to the extent not otherwise covered by or
specifically excluded from (including exclusions contained in the definitions
of) any of the foregoing, all its other personal property and assets other than
(i) Real Properties and (ii) tangible personal property located outside of the
United States; and
(p) to the extent not otherwise included above, all
proceeds, tort claims, insurance claims, and other rights to payments not
otherwise included in the foregoing, all products of the foregoing, all
accessions to, substitutions and replacements for, and rents, leases, and
profits of, each of the foregoing, other than (i) Real Properties and (ii)
tangible personal property located outside of the United States.
55
SECTION 3.02. Further Assurances. At any time and from time to
time, upon the written request of the Agent, and at the sole expense of the
Borrowers and the Guarantors, the Borrowers and the Guarantors will promptly and
duly execute and deliver, and have recorded, such further instruments and
documents and take such further actions as the Agent may reasonably request for
the purpose of perfecting the assignments and security interests granted
hereunder and obtaining or preserving the full benefits of this Agreement and of
the rights and powers herein granted, including, without limitation, (a) filing
any financing or continuation statements under the Uniform Commercial Code (or
other similar laws) in effect in any relevant jurisdiction with respect to the
security interests created hereby, (b) in the case of Investment Property,
Deposit Accounts, Electronic Chattel Paper, Letter of Credit Rights and any
other relevant Collateral, taking any actions requested by the Agent to enable
the Agent to obtain "control" (within the meaning of the applicable Uniform
Commercial Code) with respect thereto; provided, however, that in any event, and
without any specific request therefor, the Borrowers and the Guarantors shall
deliver to the Agent on the Closing Date or promptly upon receipt thereof, if
later, all Pledged Notes in a principal amount of $100,000 or more, (c)
complying with any requirements of law (including the Federal Assignment of
Claims Act) as to any Collateral if such compliance is reasonably deemed
necessary or advisable by the Agent for the attachment, perfection or priority
of, or the ability of the Agent to enforce, the Agent's security interest in
such Collateral, (d) obtaining consents and approvals from any governmental
authority or other Person, including without limitation any consent of any
licensor, lessor or other Person obligated on Collateral, (e) executing and
delivering such documents, agreements, invoices, documents of title, dock
warrants, dock receipts, warehouse receipts, bills of lading, orders, and
instruments as may be reasonably required by the Agent to further evidence and
perfect its security interests in the Collateral, (f) obtaining waivers from
mortgagees, landlords and repairmen in form and substance reasonably
satisfactory to the Agent, and (g) taking all actions required by the Uniform
Commercial Code or by other law, as applicable in any relevant Uniform
Commercial Code jurisdiction, provided, however, that notwithstanding anything
in this SECTION 3.02 to the contrary, no instruments or documents related to the
Collateral will be executed or delivered or other actions taken with respect to
the laws of any foreign jurisdiction. The Borrowers shall perform or cause to be
performed such acts as the Agent may reasonably request to establish and
maintain for the Agent a valid and perfected security interest in and security
title to the Collateral, free and clear of any Liens other than Permitted
Encumbrances. Each Borrower hereby acknowledges that it authorized the Agent to
file financing statements relating hereto prior to the Closing Date and hereby
ratifies the filing of such financing statements prior to the Closing Date.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
Each of the Borrowers and Guarantors (by execution and delivery of the
Guaranty) represents and warrants to the Agent and the Lenders that:
SECTION 4.01. Corporate Existence and Power. Each of the
Borrowers and each Domestic Subsidiary is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation, is duly qualified to transact business in every jurisdiction
where, by the nature of its business, such qualification is necessary (as set
56
forth on SCHEDULE 4.01 as supplemented in writing to the Agent from time to
time), and has all corporate powers and all governmental licenses,
authorizations, consents and approvals required to carry on its business as now
conducted, except where any such failure to qualify or have all required
governmental licenses, authorizations, consents and approvals does not have and
would not reasonably be expected to cause a Material Adverse Effect.
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by the Borrowers of this
Agreement, the Notes and the other Credit Documents to which they are a party
and by each of the Guarantors of the Guaranty, the Contribution Agreement and
the other Credit Documents to which they are a party (a) are within the relevant
Borrower's corporate powers, (b) have been duly authorized by all necessary
corporate action, and have been executed on behalf of the Borrowers or
Guarantors (as the case may be) by duly authorized officers, (c) require no
action by or in respect of or filing with, any governmental body, agency or
official, except for periodic filings under the Securities Exchange Act of 1934,
(d) do not contravene, or constitute a material default under, any provision of
applicable law or regulation or of the articles of incorporation or by-laws of
the Borrowers or Guarantors or of any agreement, judgment, injunction, order,
decree or other instrument binding upon the Borrowers or any of the
Subsidiaries, and (e) do not result in the creation or imposition of any Lien on
any asset of the Borrowers or any of the Subsidiaries, except in favor of the
Agent.
SECTION 4.03. Binding Effect. This Agreement constitutes a
valid and binding agreement of the Borrowers enforceable in accordance with its
terms, and the Notes and the other Credit Documents executed by each of the
Borrowers, and the Guaranty, the Contribution Agreement and the other Credit
Documents executed by each Guarantor, when executed and delivered in accordance
with this Agreement, will constitute valid and binding obligations of the
Borrowers or Guarantors (as the case may be) enforceable in accordance with
their respective terms, provided that the enforceability hereof and thereof is
subject in each case to general principles of equity and to bankruptcy,
insolvency and similar laws affecting the enforcement of creditors' rights
generally.
SECTION 4.04. Financial Information.
(a) The (i) audited consolidated financial statements
(including the balance sheet and statements of income, shareholders' equity and
cash flows) of the Parent and its Consolidated Subsidiaries for the Fiscal Year
ending on December 31, 2002, reported on by Ernst & Young LLP, copies of which
have been delivered to each of the Lenders, and (ii) unaudited consolidated
financial statements (including the balance sheet and statements of income,
shareholders' equity and cash flows) of the Parent and its Consolidated
Subsidiaries, for the interim period ended June 30, 2003, copies of which have
been delivered to each of the Lenders, fairly present in all material respects,
in conformity with GAAP (except, with respect to the unaudited statements for
the interim period, for the absence of footnotes and normal year-end
adjustments), the consolidated financial position of the Parent and its
Consolidated Subsidiaries as of such dates and their consolidated results of
operations and cash flows for such periods stated.
57
(b) Since December 31, 2002, there has been no event,
act, condition or occurrence having a Material Adverse Effect.
SECTION 4.05. Litigation. Except as disclosed in SCHEDULE
4.05, there is no judgment, order, writ or decree outstanding against the
Borrowers or any of the Subsidiaries, or any action, suit or proceeding pending,
or to the knowledge of the Borrowers threatened, against or affecting the
Borrowers or any of the Subsidiaries before any court or arbitrator or any
governmental body, agency or official, which would in any of the foregoing
events reasonably be expected to cause a Material Adverse Effect.
SECTION 4.06. Compliance with ERISA.
(a) The Borrowers and each member of the Controlled Group
have fulfilled their obligations under the minimum funding standards of ERISA
and the Code with respect to each Plan and are in compliance in all material
respects with the presently applicable provisions of ERISA and the Code, and
have not incurred any liability to the PBGC or a Plan under Title IV of ERISA
that has not been appropriately accrued for.
(b) Neither the Borrowers nor any member of the
Controlled Group is or within the preceding 5 years has been obligated to
contribute to any Multiemployer Plan.
SECTION 4.07. Compliance with Laws; Payment of Taxes. The
Borrowers and the Subsidiaries are in material compliance with all applicable
laws, regulations and similar requirements of governmental authorities
(including, without limitation, the Fair Labor Standards Act of 1938, as
amended), except as set forth in SECTION 4.13 or where such compliance is being
contested in good faith through appropriate proceedings, and except where any
such failure to comply (other than with respect to the Fair Labor Standards Act
of 1938, as amended) does not have and would not reasonably be expected to cause
a Material Adverse Effect, and the Borrowers have adopted and continue to follow
appropriate compliance programs, policies or business activities satisfactory to
assure the accuracy of the foregoing statement. There have been filed on behalf
of the Borrowers and the Subsidiaries all Federal, state and local income,
excise, property and other tax returns which are required to be filed by them
and all taxes due pursuant to such returns or pursuant to any assessment
received by or on behalf of the Borrowers or any Subsidiary have been paid. The
charges, accruals and reserves on the books of the Borrowers and the
Subsidiaries in respect of taxes or other governmental charges are, in the
opinion of the Borrowers, adequate. United States income tax returns of the
Borrowers and the Subsidiaries have been examined and closed at least through
the Fiscal Year ended on or about December 31, 1998.
SECTION 4.08. Investment Company Act. Neither the Borrowers
nor any of the Subsidiaries is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
SECTION 4.09. Public Utility Holding Company Act. Neither the
Borrowers nor any of the Subsidiaries is a "holding company", or a "subsidiary
company" of a "holding company", or an "affiliate" of a "holding
58
company" or of a "subsidiary company" of a "holding company", as such terms are
defined in the Public Utility Holding Company Act of 1935, as amended.
SECTION 4.10. Ownership of Property; Liens. Each of the
Borrowers and the Subsidiaries has title to its material properties sufficient
for the conduct of its business, and none of such property is subject to any
Lien except for Permitted Encumbrances.
SECTION 4.11. No Default. Neither the Borrowers nor any of the
Subsidiaries is in default under or with respect to any agreement, instrument or
undertaking to which it is a party or by which it or any of its property is
bound which would cause or would reasonably be expected to cause a Material
Adverse Effect. No Default or Event of Default has occurred and is continuing.
SECTION 4.12. Full Disclosure. All information heretofore
furnished by the Borrowers and the Guarantors to the Agent or any Lender for
purposes of or in connection with this Agreement or any transaction contemplated
hereby is, and all such information hereafter furnished by the Borrowers and the
Guarantors to the Agent or any Lender will be, true, accurate and complete in
every material respect or based on reasonable estimates on the date as of which
such information is stated or certified. To the best knowledge of the executive
officers of the Borrowers, the Borrowers have disclosed to the Lenders in
writing any and all facts which would reasonably be expected to cause a Material
Adverse Effect.
SECTION 4.13. Environmental Matters. Except as disclosed in
SCHEDULE 4.13:
(a) As of the Closing Date, neither the Borrowers nor any
Guarantor is subject to any Environmental Liability which would cause or would
reasonably be expected to cause a Material Adverse Effect and, to the knowledge
of the Borrowers, neither the Borrowers nor any Subsidiary has been designated
as a potentially responsible party under CERCLA or under any state statute
similar to CERCLA. To the knowledge of the Borrowers, none of the Aggregate Real
Properties has been identified on any current or proposed (i) National
Priorities List under 40 C.F.R. Section 300, (ii) CERCLIS list or (iii) any list
arising from a state statute similar to CERCLA, except to the extent the
foregoing are disclosed in writing to the Agent after the Closing Date.
(b) To the knowledge of the Borrowers and Guarantors,
except where any of the following would not cause and would not reasonably be
expected to cause a Material Adverse Effect, no Hazardous Materials have been or
are being used, produced, manufactured, processed, treated, recycled, generated,
stored, disposed of, managed or otherwise handled at, or shipped or transported
to or from the Aggregate Real Properties or are otherwise present at, on, in or
under the Aggregate Real Properties, or, to the best of the knowledge of the
Borrowers and Guarantors, at or from any adjacent site or facility, except for
Hazardous Materials, such as cleaning solvents, pesticides and other materials
used, produced, manufactured, processed, treated, recycled, generated, stored,
disposed of, managed, or otherwise handled in the ordinary course of business in
substantial compliance with all applicable Environmental Requirements.
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(c) To the knowledge of the Borrowers and Guarantors, the
Borrowers and each of the Guarantors have procured all Environmental
Authorizations necessary for the conduct of its business, and are in substantial
compliance with all Environmental Requirements in connection with the operation
of the Aggregate Real Properties and the Borrowers' and each of the Guarantors'
respective businesses, except to the extent such non-procurement or
non-compliance would not cause and would not reasonably be expected to cause a
Material Adverse Effect.
SECTION 4.14. Capital Stock. All Capital Stock, Redeemable
Preferred Stock, debentures, bonds, notes and all other securities of the
Borrowers and the Subsidiaries presently issued and outstanding are validly and
properly issued in accordance with all applicable laws, including, but not
limited to, the "Blue Sky" laws of all applicable states and the federal
securities laws. The issued shares of Capital Stock and Redeemable Preferred
Stock of the Parent's Wholly Owned Subsidiaries are directly or indirectly owned
by the Parent free and clear of any Lien or adverse claim, except for Permitted
Encumbrances. At least a majority of the issued shares of capital stock of each
of the Parent's other Subsidiaries (other than Wholly Owned Subsidiaries) is
directly or indirectly owned by the Parent free and clear of any Lien or adverse
claim, except for Permitted Encumbrances.
SECTION 4.15. Margin Stock. Neither the Borrowers nor any of
the Subsidiaries is engaged principally, or as one of its important activities,
in the business of purchasing or carrying any Margin Stock, and no part of the
proceeds of any Loan will be used to purchase or carry any Margin Stock or to
extend credit to others for the purpose of purchasing or carrying any Margin
Stock, or be used for any purpose which violates, or which is inconsistent with,
the provisions of Regulation T, U or X.
SECTION 4.16. Insolvency. After giving effect to the execution
and delivery of the Credit Documents and the incurrence of the Obligations under
this Agreement: (a) the Borrowers will not collectively (i) be "insolvent,"
within the meaning of such term as defined in Section 101 of the Bankruptcy
Code, or either the "UFTA" or the "UFCA", or as defined or used in any "Other
Applicable Law" (as those terms are defined below), or (ii) be unable to pay
their debts generally as such debts become due within the meaning of Section 548
of the Bankruptcy Code, Section 4 of the UFTA or Section 6 of the UFCA, or (iii)
have an unreasonably small capital to engage in any business or transaction,
whether current or contemplated, within the meaning of Section 548 of the
Bankruptcy Code, Section 4 of the UFTA or Section 5 of the UFCA; and (b) the
Obligations of the Borrowers and the Guarantors under the Credit Documents to
which they are party will not be rendered avoidable under any Other Applicable
Law. For purposes of this SECTION 4.16, "UFTA" means the Uniform Fraudulent
Transfer Act, "UFCA" means the Uniform Fraudulent Conveyance Act, and "Other
Applicable Law" means any other applicable law pertaining to fraudulent
transfers or acts voidable by creditors, in each case as such law may be amended
from time to time.
SECTION 4.17. Insurance. The Parent and each of the
Subsidiaries have (either in the name of the Parent or in such Subsidiary's own
name), with financially sound and reputable insurance companies and with a
Best's Rating of at least "A", insurance in at least such amounts and against at
least such risks (including on all its property, and business interruption,
public liability and worker's compensation, to the extent not self insured as to
worker's
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compensation) as are usually insured against in the same general area by
companies of established repute engaged in the same or similar business.
SECTION 4.18. Purchase of Collateral. Within the 12 months
period preceding the Closing Date, none of the Borrowers or Guarantors has
purchased any material portion of the Collateral located in the United States
(i) in a bulk transfer or (ii) to the Borrowers' and Guarantors' knowledge, in a
transaction which was outside the ordinary course of the business of such
Borrower's or Guarantor's seller except as disclosed on the Collateral
Disclosure Certificates.
SECTION 4.19. Possession of Permits. Each Borrower and each
Subsidiary possess all franchises, certificates, licenses, permits and other
authorizations from governmental political subdivisions or regulatory
authorities, free from burdensome restrictions, that are necessary for the
ownership, maintenance and operation of any of its properties and assets, and no
Borrower or Subsidiary is in violation of any thereof except where any such
failure to possess or violation of any of the foregoing does not have and would
not reasonably be expected to cause a Material Adverse Effect.
SECTION 4.20. Labor Disputes. Except as disclosed in SCHEDULE
4.20 (and with respect to clauses (a), (b) and (c) below, except as disclosed in
writing to the Agent after the Closing Date), (a) there is no collective
bargaining agreement or other labor union contract covering employees of the
Borrowers or any Subsidiary, (b) no such collective bargaining agreement or
other labor union contract is scheduled to expire during the term of this
Agreement, (c) to the Borrowers' knowledge, no union or other labor organization
is seeking to organize, or to be recognized as, a collective bargaining unit of
employees of any of the Borrowers or any Subsidiary or for any similar purpose
and (d) except as would not reasonably be expected to cause a Material Adverse
Effect, there is no pending, or to the Borrower's knowledge, threatened, strike,
work stoppage, unfair labor practice claim, or other labor dispute against or
affecting any Borrower or any Subsidiary or their respective employees.
SECTION 4.21. Surety Obligations. Except as shown on SCHEDULE
4.21 or disclosed in writing to the Agent after the Closing Date, none of the
Borrowers nor any of their Domestic Subsidiaries is obligated as surety or
indemnitor under any surety or similar bond or other similar contract issued or
entered into to assure payment (except as permitted in SECTION 5.20),
performance or completion of performance of any undertaking or obligation of any
Person.
SECTION 4.22. Restrictions. Except as permitted by SECTION
5.03, none of the Borrowers nor any of their Subsidiaries is a party or subject
to any contract, agreement, or charter or other corporate restriction, which
affects its business or the use or ownership of any of its assets in a manner
which materially and adversely impedes Borrowers' and Guarantors' ability to
conduct their activities in the ordinary course of business. Except as set forth
on SCHEDULE 4.22, none of the Borrowers nor any of their Subsidiaries is a party
or subject to any contract or agreement which restricts its right or ability to
incur Debt, none of which prohibit the execution of or compliance with this
Agreement or the other Credit Documents by the Borrowers or any of their
Subsidiaries, as applicable.
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SECTION 4.23. Leases. SCHEDULE 4.23 is a complete listing of
all capitalized and operating leases of the Borrowers and their Domestic
Subsidiaries on the Closing Date hereof (a) which are real property leases in
the United States where Collateral is located; and (b) otherwise that are
individually in excess of $100,000 annually in amount. Each of the Borrowers and
their Domestic Subsidiaries is in compliance in all material respects with all
of the terms of each of its respective capitalized and operating leases, except
to the extent that such noncompliance would not cause and would not reasonably
be expected to cause a Material Adverse Effect.
SECTION 4.24. Business Conduct. To the best of Borrowers' and
Guarantors' knowledge, there exists no present condition or state of facts or
circumstances which would affect the Borrowers or any of their Subsidiaries or
prevent the Borrowers or any of their Subsidiaries from conducting its business
after the consummation of the transactions contemplated by this Agreement in
substantially the same manner in which they have heretofore been conducted, and,
to the best of each Borrower's knowledge, there exists no actual or threatened
termination, cancellation or limitation of, or any modification or change in,
the business relationship between the Borrowers, the Guarantors or any of their
Subsidiaries and any customer or any group of customers whose purchases
individually or in the aggregate are material to the business of the Borrowers
or any of their Subsidiaries, or with any material supplier, except to the
extent that any of the foregoing would not cause and would not reasonably be
expected to cause a Material Adverse Effect.
SECTION 4.25. Capital Structure. As of the Closing Date,
SCHEDULE 4.25 states (a) the correct name of each of the Subsidiaries of Parent
and each Borrower, its jurisdiction of incorporation and the percentage of its
Capital Stock and Redeemable Preferred Stock owned by the Parent and each
Borrower, (b) the name of each of the Parent's and the Borrowers' Affiliates and
the nature of such affiliation, (c) the number, nature and holder of all Capital
Stock and Redeemable Preferred Stock of each Borrower and each Domestic
Subsidiary of such Borrower, and (d) the number of authorized, issued and
treasury shares of each Borrower and each Domestic Subsidiary of such Borrower.
The Borrowers have good title to all of the shares they purport to own of the
Capital Stock and Redeemable Preferred Stock of each of its Subsidiaries, free
and clear in each case of any Lien other than Permitted Encumbrances. All such
shares have been duly issued and are fully paid and non-assessable.
SECTION 4.26. Article 9 Information. Except as disclosed in
writing to the Agent after the Closing Date, such disclosure to be given at
least thirty (30) days' prior to the effectiveness of the change to the relevant
information, each Borrower's and Guarantor's jurisdiction of incorporation or
organization, type of organization, exact legal name, federal taxpayer
identification number, organizational identification number (if any) issued by
its state of incorporation or organization, and the location of such Borrower's
or Guarantor's Executive Office or sole or principal place of business is
specified correctly in such Borrower's or Guarantor's Collateral Disclosure
Certificate.
SECTION 4.27. Accounts. Each right to payment which any
Borrower or Guarantor claims or asserts is an "Account" will arise under a
contract between a Borrower and the respective Account Debtor and would
constitute an "Account" as such term is defined herein.
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(a) The amounts represented by the Borrowers or
Guarantors to the Agent from time to time as owing to the Borrowers or
Guarantors in respect of the Accounts will at such times be accurate in all
material respects.
(b) No amount payable to any Borrower or Guarantor under
or in connection with any Account is evidenced by any Instrument or Chattel
Paper which has not been or will not be delivered to the Agent, or if such
Chattel Paper constitutes Electronic Chattel Paper, over which the Agent has or
will have control.
SECTION 4.28. Good Title to Collateral. The Borrowers and
Guarantors have good title to the Collateral free and clear of all Liens, other
than any Permitted Encumbrances, and no assertable financing statement covering
the Collateral is on file in any public office other than any evidencing
Permitted Encumbrances.
SECTION 4.29. Right to Assign and Grant Security Interest. The
Borrowers and Guarantors have full right, power and authority to assign the
Accounts pursuant to this Agreement and to grant a security interest in all of
the Collateral.
SECTION 4.30. Trade Styles.
Except as may be set forth on the Collateral Disclosure
Certificates, the Borrowers and the Guarantors use no trade names or trade
styles (herein, "Trade Styles") in their business operations and warrant that
the same shall continue, except for any additional Trade Styles after the date
hereof with respect to which the Borrowers or the Guarantors have given the
Agent at least 30 days prior written notice thereof. In any event, to the extent
that, now or hereafter, the Borrowers or the Guarantors use any Trade Styles,
the Borrowers and Guarantors hereby represent and warrant in favor of the Agent
that:(a) all of the Accounts and proceeds with respect thereto arising out of
sales under the Trade Styles shall be the property of, and belong to, the
Borrowers and Guarantors and shall constitute Accounts as such term is defined
herein; (b) each of the Trade Styles is a trade name and trade style (and not an
independent corporation or other legal entity) by which the Borrowers and the
Guarantors identify and sell certain of their products or services and under
which they may conduct a portion of their business; (c) all Accounts, proceeds
thereof, and returned merchandise which arise from the sale of products invoiced
under the names of any of the Trade Styles shall be owned solely by the
Borrowers or Guarantors and shall be subject to the terms of this Agreement as
they relate to Accounts and the Collateral; and (d) each Borrower and Guarantor
hereby appoints the Agent as its attorney-in-fact to file such certificates
disclosing such Borrower's or Guarantor's use of the Trade Styles and to take
such other actions on its behalf as are necessary to comply with the statutes of
any states relating to the use of fictitious or assumed business names, to the
extent that such Borrower or Guarantor fails to do so after notice to such
Borrower or Guarantor and an opportunity to cure for a period of thirty (30)
calendar days.
SECTION 4.31. Farm Products.
None of the Collateral constitutes, or is the proceeds of,
Farm Products.
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SECTION 4.32. Investment Property.
(a) Each Borrower's and Guarantor's Pledged Interests
constitute all of the issued and outstanding Equity Interests owned by such
Borrower or Guarantor in such Person. All of the Pledged Interests owned by each
Borrower and Guarantor are represented by the certificates (or are in
non-certificated form) as listed in such Borrower's or Guarantor's Collateral
Disclosure Certificate or as disclosed in writing to the Agent after the Closing
Date.
(b) All the Borrowers' and Guarantors' Pledged Interests
have been duly and validly issued and are fully paid and nonassessable. There is
no amount or other obligation owing by any Borrower or Guarantor to any issuer
of such Pledged Interests in exchange for or in connection with the issuance of
the Pledged Interests or the Borrowers' or Guarantors' status as a stockholder,
member, or partner of any such issuer.
(c) Each of the Pledged Notes constitutes the legal,
valid and binding obligation of the obligor with respect thereto, enforceable in
accordance with its terms, subject to the effects of bankruptcy, insolvency and
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally and general equitable principles (whether considered
in a proceeding in equity or at law).
(d) The relevant Borrower or Guarantor is the record and
beneficial owner of, and has good and marketable title to, the Investment
Property pledged by it hereunder, free of any and all Liens or options in favor
of, or claims of, any other Person, except Permitted Encumbrances.
SECTION 4.33. Intellectual Property.
(a) As of the Closing Date, all Intellectual Property
owned by each Borrower and Guarantor consisting of Patents or applications
therefor, registered Trademarks, unregistered Trademarks (to the extent that the
Borrowers or the Guarantors consider such Trademark material to such Borrower's
or Guarantor's business) or applications for registration thereof, and
registered Copyrights or applications for registration of Copyrights is listed
on such Borrower's or Guarantor's Collateral Disclosure Certificate.
(b) Each Borrower and Guarantor owns or has all necessary
and defensible right to use, whether through ownership, license or otherwise,
all Intellectual Property material to the business of each Borrower and
Guarantor as such businesses are conducted on the date hereof (subject to such
changes in such business as permitted in SECTION 5.03). All Intellectual
Property of each Borrower and Guarantor is valid, subsisting, unexpired and
enforceable, has not been abandoned and does not infringe the intellectual
property rights of any other Person, except as any of the foregoing would not
reasonably be expected to cause a Material Adverse Effect.
(c) None of any Borrower's or Guarantor's Intellectual
Property is the subject of any licensing or franchise agreement pursuant to
which such Borrower or Guarantor is the licensee or franchisee, except as shown
on such Borrower's or Guarantor's Collateral Disclosure Certificate or as
disclosed in writing to the Agent after the Closing Date.
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(d) No holding, decision or judgment has been rendered by
any governmental authority or arbitrator which would limit, cancel or question
the validity of, or the Borrowers' or Guarantors' rights in, any material
Intellectual Property in any material respect, except as shown on SCHEDULE 4.33
or as disclosed in writing to the Agent after the Closing Date.
(e) No action or proceeding is pending, or, to the
knowledge of any of the Borrowers or the Guarantors, threatened, on the date
hereof seeking to limit, cancel or question the validity of any Borrower's or
Guarantor's Intellectual Property or such Borrower's ownership interest therein
in any material respect except as shown on SCHEDULE 4.33 or as disclosed in
writing to the Agent after the Closing Date.
SECTION 4.34. Account Debtor Capacity and Solvency. To the
best of Borrowers' knowledge, except for Account Debtors whose accounts are not
included as an Eligible Account in the Borrowing Base computation, each Account
Debtor (a) had the capacity to contract at the time any contract or other
document giving rise to the Account was executed and (b) such Account Debtor was
not at the time of the sale and is not "insolvent" as that term is defined in
SECTION 4.16.
SECTION 4.35. Proceedings with Respect to Accounts. To the
best of Borrowers' knowledge, except for Account Debtors whose accounts are not
included as an Eligible Account in the Borrowing Base computation, there are no
proceedings or actions which are threatened or pending against any Account
Debtor which are reasonably likely to have a material adverse change in such
Account Debtor's financial condition or the collectibility of Accounts owing by
it to a Borrower or a Guarantor.
SECTION 4.36. Location of Collateral. The Collateral
consisting of Goods of the Borrowers or the Guarantors is situated only at one
or more of the Collateral Locations and each Borrower or Guarantor has exclusive
possession and control over the Equipment and Inventory owned by it (subject to
any rights of holders of Permitted Encumbrances), except in any event for (a)
Inventory on consignment or subject to bailment agreements provided that the
Borrowers or Guarantors have filed a financing statement with respect to such
Goods, (b) Goods in transit from one Collateral Location to another or from a
Collateral Location to a customer location in connection with a sale, (c) metal
or wooden reels on which Goods are placed (to the extent such reels are empty of
such Goods), (d) other Goods having an aggregate value of $75,000 or less and
(e) changes in locations of Goods in connection with transactions permitted by
SECTION 5.31.
SECTION 4.37. Inventory. All of the Borrowers' and Guarantors'
Inventory has been produced in compliance in all material respects with all
requirements of the Fair Labor Standards Act.
SECTION 4.38. Material Contracts. Each Borrower's and
Guarantor's Material Contracts are listed on such Borrower's or Guarantor's
Collateral Disclosure Certificate or as disclosed in writing to the Agent after
the Closing Date. Each Borrower and Guarantor is in compliance in all material
respects with all terms and provisions of each Material Contract except as
disclosed in writing after the Closing Date.
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SECTION 4.39. Force Majeure. None of the Borrowers' business
is suffering from effects of fire, accident, strike, drought, storm, earthquake,
embargo, tornado, hurricane, act of God, acts of a public enemy or other
casualty that would have a Material Adverse Effect.
SECTION 4.40. Survival of Representations and Warranties. The
Borrowers and Guarantors covenant, warrant and represent to the Agent and each
Lender that all representations and warranties of the Borrowers, the Guarantors
and their Subsidiaries contained in this Agreement or any of the other Credit
Documents shall be true at the time of the execution of this Agreement or the
other Credit Documents, as applicable, and shall survive the execution, delivery
and acceptance thereof by Agent and the parties thereto and the closing of the
transactions described therein or related thereto.
ARTICLE 5
COVENANTS
Each of the Borrowers and each of the Guarantors (by execution
and delivery of the Guaranty) agree that, so long as any Lender has any
Commitment hereunder or any amount payable hereunder or any of the Obligations
remains unpaid (each Borrower making such covenants as to itself and each
Guarantor making such covenants as to itself):
SECTION 5.01. Information. The Borrowers will deliver to each
of the Lenders:
(a) as soon as available and in any event within 90 days
after the end of each Fiscal Year, audited consolidated financial statements
(including the balance sheet and statements of income, shareholders' equity and
cash flows) of the Parent and its Consolidated Subsidiaries as of the end of
such Fiscal Year and for such Fiscal Year, setting forth in comparative form the
figures for the previous fiscal year, all certified by the Certified Public
Accountants, with such certification to be free of limitation as to scope of
audit or qualification as to going concern; provided that the delivery within
the time period specified above of the Parent's Annual Report on Form 10-K for
such Fiscal Year (together with the Parent's annual report to shareholders, if
any, prepared pursuant to Rule 14a-3 under the Securities Exchange Act of 1934)
prepared in accordance with the requirements therefor and filed with the
Securities and Exchange Commission, together with such Certified Public
Accountants' opinion, shall be deemed to satisfy the requirements of this
Section 5.01(a);
(b) as soon as available and in any event within 50 days
after the end of each of the first three Fiscal Quarters of each Fiscal Year,
consolidated financial statements (including the balance sheet and statements of
income, shareholders' equity and cash flows) of the Parent and its Consolidated
Subsidiaries, as of the end of such Fiscal Quarter, and for such Fiscal Quarter
and the portion of the Fiscal Year ending on such date, setting forth in
comparative form the figures for the corresponding Fiscal Quarter and the
corresponding portion of the previous Fiscal Year and in comparison to the
projections furnished pursuant to SECTION 5.01(f), all certified (subject to the
absence of footnotes and other presentation items and normal year-end
adjustments) as to fairness of presentation, GAAP and consistency by a Senior
Officer of the Parent (such quarterly financial statements may be furnished by
furnishing to the Lenders the Form 10-Q for such Fiscal Quarter filed with the
Securities and Exchange Commission, provided
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that the Lenders are furnished separate comparisons for such Fiscal Quarter to
the projections furnished pursuant to SECTION 5.01(f));
(c) as soon as available and in any event within 30 days
after the end of each Fiscal Month, (i) consolidated financial statements
(including the balance sheet and statements of income) of the Parent and its
Consolidated Subsidiaries, and (ii) consolidating financial information in the
format reflected in SCHEDULE 5.01(c) of the Parent and all Subsidiaries, in each
case as of the end of such Fiscal Month, and for the portion of the Fiscal Year
ending on such date, setting forth in each case in comparative form the figures
for the corresponding Fiscal Month and the corresponding portion of the previous
Fiscal Year, all certified (subject to the absence of footnotes and other
presentation items and normal year-end adjustments) as to fairness of
presentation, GAAP and consistency by a Senior Officer;
(d) simultaneously with the delivery of each set of
financial statements referred to in paragraphs (a), (b) and (c) above, a
Compliance Certificate, of the Senior Officer (i) setting forth in reasonable
detail the calculations required to establish whether the Parent was in
compliance (or if the covenant set forth in SECTION 5.19(a) is not then
applicable in accordance with its terms, would be in compliance if it were then
applicable) with the requirements of SECTIONS 5.16, 5.17, 5.19 and 5.20, on the
date of such financial statements and (ii) stating whether any Default exists on
the date of such certificate and, if any Default then exists, setting forth the
details thereof and the action which the Parent or any Borrower is taking or
proposes to take with respect thereto;
(e) simultaneously with the delivery of each set of
annual financial statements referred to in paragraph (a) above, (i) a statement
of the Certified Public Accountants to the effect that (A) such accountants
acknowledge and agree that the Agent and the Lenders may rely upon such
financial statement in the administration of this Agreement, and (B) nothing has
come to their attention to cause them to believe that any Default existed on the
date of such financial statements under SECTIONS 5.16, 5.17, 5.19 or 5.20,
insofar as they relate to accounting matters (which statement may be limited to
the extent required by accounting rules or guidelines and it being acknowledged
by the Agent and the Lenders that the audit of the Certified Public Accountants
was not directed primarily toward obtaining knowledge of such compliance or
noncompliance), and (ii) a copy of any management letter furnished to the Parent
by the Certified Public Accountants;
(f) as soon as available and in no event later than the
end of each Fiscal Year, projections of the Borrowers and their Subsidiaries on
a consolidated basis for the forthcoming Fiscal Year, including income
statements, balance sheets, statements of cash flow, and borrowing base
availability and financial covenant calculations (including those set forth in
SECTION 5.19(a) and (b), whether or not then applicable), and set forth Fiscal
Quarter by Fiscal Quarter, together with all material assumptions made in
connection therewith;
(g) promptly, but in any event within 5 Domestic Business
Days after any Senior Officer actually becomes aware of the occurrence of any
Default, a certificate of the Senior Officer setting forth the details thereof
and the action which the Borrowers or Guarantors are taking or propose to take
with respect thereto; provided that, so long as the Parent has complied with
this subsection (g) in respect of any Default, the Agent agrees in good faith
that,
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for so long (but only for so long) as (i) the Parent is negotiating or
discussing with the Agent and the Lenders whether such Default could be cured by
waiver, amendment or similar arrangement and (ii) the Required Lenders are
willing in their sole and absolute discretion to continue such negotiations and
discussions regarding the terms and conditions of any such waiver, amendment or
similar arrangement (it being understood that neither the Agent nor the Lenders
shall be under any obligation at any time to enter into or participate in or
continue any such negotiations or discussions or to agree to the terms and
conditions of any such waiver, amendment or similar arrangement), the Agent will
not notify the Parent, any Borrower or any Guarantor of such Default or
otherwise declare that such Default has occurred if doing so would trigger an
obligation on the part of the Parent under applicable federal securities laws
and regulations to disclose publicly the occurrence of such Default;
(h) promptly upon the mailing thereof (i) to the
shareholders of the Parent generally, copies of all financial statements,
reports and proxy statements so mailed and (ii) to the holders of the Senior
Notes, copies of the certificates concerning covenant compliance furnished
pursuant to Section 7.2(a) of the Senior Note Purchase Agreements;
(i) promptly upon the filing thereof, copies of all
registration statements (other than the exhibits thereto and any registration
statements on Form S-8 or its equivalent) and annual or quarterly reports which
the Parent shall have filed with the Securities and Exchange Commission;
(j) promptly after the date that any member of the
Controlled Group (i) gives or is required to give notice to the PBGC of any
"reportable event" (as defined in SECTION 4043 of ERISA) with respect to any
Plan which might constitute grounds for a termination of such Plan under Title
IV of ERISA, or knows that the plan administrator of any Plan has given or is
required to give notice of any such reportable event, a copy of the notice of
such reportable event given or required to be given to the PBGC; (ii) receives
notice of complete or partial withdrawal liability under Title IV of ERISA, a
copy of such notice; or (iii) receives notice from the PBGC under Title IV of
ERISA of an intent to terminate or appoint a trustee to administer any Plan, a
copy of such notice;
(k) as soon as practicable, but in any event on or before
15 days after the end of each Fiscal Month, or such more frequent intervals as
required by the Agent from time to time in its commercially reasonable judgment,
a duly executed Borrowing Base Certificate (and to the Agent any accompanying
documentation required by the Agent), with respect to satisfaction of the
requirement that the Working Capital Obligations shall not exceed the Borrowing
Base, as of the last day of the reporting period, in the form of EXHIBIT F or
such other form as the Agent may deliver for such purpose to the Borrowers from
time to time hereafter, the statements in which, in each instance, shall be
certified as to truth and accuracy by the Senior Officer;
(l) written notice of the following:
(i) promptly after a Senior Officer obtains
actual knowledge thereof, of (A) the commencement of any
litigation affecting any Borrower or Guarantor or any of their
respective Subsidiaries or any of their respective assets,
whether or not the claim is considered by the Borrowers or the
Guarantors to be covered by
68
insurance, and (B) the institution of any administrative
proceeding, which in either case of clause (A) or (B) would be
reasonably expected to cause a Material Adverse Effect;
(ii) within 30 days after the opening of any new
office (excluding sales offices) or place of business of any
Borrower or any Guarantor or the closing of any existing
office or place of business of any Borrower or Guarantor;
(iii) promptly after such Borrower's learning
thereof, of any labor dispute to which any Borrower or
Subsidiary may become a party, or any strikes or walkouts
relating to any of its plants or other facilities, which in
either case would reasonably be expected to cause a Material
Adverse Effect, and the expiration of any labor union contract
to which it is a party or by which it is bound which
expiration would cause or would reasonably be expected to
cause a Material Adverse Effect;
(iv) promptly after a Senior Officer obtains
actual knowledge thereof, of any default by any obligor under
any note or other evidence of indebtedness payable to any
Borrower or Guarantor exceeding $1,000,000;
(v) promptly after the rendition thereof, of any
judgment in an amount exceeding $1,000,000 rendered against
any Borrower or any of its Subsidiaries;
(vi) promptly after any Borrowers' learning
thereof, (1) knowledge of any and all Environmental
Liabilities, pending or threatened Environmental Proceedings,
Environmental Notices, Environmental Judgments and Orders, and
Environmental Releases at, on, in, under or in any way
affecting the Aggregate Real Properties, and all facts,
events, or conditions that could lead to any of the foregoing,
and (2) the designation of the Borrowers or any Subsidiary as
a potentially responsible party under CERCLA or under any
state statute similar to CERCLA, if any of the foregoing in
clause (1) or (2) would cause or would reasonably be expected
to cause a Material Adverse Effect;
(vii) within 15 days after the end of each Fiscal
Quarter, an update of SCHEDULE 4.25 if there are changes
thereto; and
(viii) promptly upon the execution thereof, of any
amendment to the Senior Note Purchase Agreements entered into
by any Borrower, and such Borrower shall send the Agent a copy
thereof promptly thereafter;
(m) from time to time such additional information
regarding the financial position or business (including, without limitation, tax
returns and bank statements) of the Borrowers and the Subsidiaries as the Agent,
at the request of any Lender, may reasonably request.
69
SECTION 5.02. Inspection of Property, Books and Records.
(a) The Borrowers will (i) keep, and cause each
Subsidiary to keep, proper books of record and account in which full, true and
correct entries in conformity (on a consolidated basis) with GAAP shall be made
of all dealings and transactions in relation to its business and activities; and
(ii) permit, and cause each Subsidiary to permit, the Agent or representatives
of the Agent and any Lender (at the Borrowers' expense if a Default or Event of
Default is in existence or at the Agent's or such Lender's respective expense,
as the case may be, prior to the occurrence of a Default or Event of Default) to
visit and inspect any of their respective properties, verify information with
any Person, to examine and make abstracts from any of their respective books and
records and to discuss their respective affairs, finances and accounts with
their respective officers, employees and the Certified Public Accountants, the
Borrowers agreeing to cooperate and assist in such visits and inspections, in
each case (x) prior to the occurrence of a Default, at such reasonable times and
as often as may reasonably be requested but upon reasonable prior notice, and
(y) after the occurrence of a Default, at any time and without prior notice.
(b) In addition to the rights granted the Agent and the
Lenders pursuant to SECTION 5.02(a), the Agent (or any person or persons
designated by it) shall, in its commercially reasonable discretion, have the
right to call at any place of business of the Borrowers at any time upon
reasonable prior notice prior to the occurrence of a Default and after the
occurrence of a Default at any time without prior notice, and, without hindrance
or delay, examine, inspect, and audit all or any portion of the Collateral and
to examine, inspect, audit and check and make copies of and extracts from the
Borrowers' books, records, journals, orders, receipts and any correspondence and
other data relating to the Collateral, to the Borrowers' business or to any
other transactions between the parties hereto.
SECTION 5.03. Maintenance of Existence. The Borrowers shall
maintain, and shall cause each Material Subsidiary to maintain, (a) their
corporate existence and not substantially change the general nature of the
business in which the Borrowers and their Subsidiaries, taken as a whole, are
engaged, except as permitted by SECTIONS 5.04 and 5.05, and (b) their respective
corporate charters, by-laws, partnership agreements, operating agreements and
other similar documents and agreements relating to their legal existence and
organization, and not permit any amendment or other modification thereto except
for any amendment or modification that would not affect the Obligations or
result in a Material Adverse Effect.
SECTION 5.04. Dissolution. The Parent shall not suffer or
permit dissolution or liquidation either in whole or in part of any Borrower or
Guarantor, except through corporate reorganization to the extent permitted by
SECTION 5.05.
SECTION 5.05. Consolidations and Mergers.
The Borrowers will not, nor will they permit any Subsidiary
to, merge or consolidate with any Person, except for (i) a merger or
consolidation between or among Borrowers, between or among Subsidiaries of the
Borrowers, or involving only a Borrower and one or more of its Subsidiaries in
which such Borrower is the surviving entity, or (ii) a merger or
70
consolidation in which a Borrower or a Subsidiary is the surviving entity (or if
such Subsidiary would not be the surviving Person, the surviving Person would be
a Subsidiary of the Parent) and such Person merging into a Borrower or a
Subsidiary is organized and existing under the laws of a State of the United
States of America, if (A) immediately after giving effect to such merger or
consolidation, no Default or Event of Default shall have occurred and be
continuing, (B) immediately after giving effect to such merger or consolidation
on a pro forma basis (including, without limitation, any Debt incurred or
anticipated to be incurred in connection with such merger or consolidation),
such Borrower or Subsidiary would be able to incur at least $1.00 of additional
Debt under SECTION 5.21, and (C) immediately after giving effect to such merger
or consolidation on a pro forma basis, Consolidated Tangible Net Worth shall be
equal to or greater than Consolidated Tangible Net Worth immediately prior to
such merger or consolidation.
SECTION 5.06. Use of Proceeds. The proceeds of the Loans shall
be used to refinance indebtedness, for capital expenditures, for working capital
and for other general corporate purposes. In no event may the proceeds of any of
the Loans be used by any Borrower or any Subsidiary (a) in connection with,
whether directly or indirectly, any tender offer for, or other acquisition of,
stock of any corporation with a view towards obtaining control of such other
corporation, unless such tender offer or other acquisition is to be made on a
negotiated basis with the approval of the Board of Directors of the Person to be
acquired, and the provisions of SECTION 5.16 would not be violated, (b) directly
or indirectly, for the purpose, whether immediate, incidental or ultimate, of
purchasing or carrying any Margin Stock, or (c) for any purpose in violation of
any applicable law or regulation.
SECTION 5.07. Compliance with Laws; Payment of Taxes. The
Borrowers and the Guarantors will, and will cause each of the other Subsidiaries
and each member of the Controlled Group to, comply with applicable laws
(including but not limited to ERISA and the Fair Labor Standards Act of 1938, as
amended), regulations and similar requirements of governmental authorities
(including but not limited to PBGC), except where the necessity of such
compliance is being contested in good faith through appropriate proceedings
diligently pursued and except where failure to comply would not cause and would
not reasonably be expected to cause a Material Adverse Effect. The Borrowers and
the Guarantors will, and will cause each of the other Subsidiaries to, pay
promptly when due all taxes, assessments, governmental charges, claims for
labor, supplies, rent and other obligations which, if unpaid, reasonably might
become a lien against any of the Collateral or against any other property of the
Borrowers or the Guarantors except in either case as permitted by SECTION 5.17,
except for liabilities being contested in good faith and against which, if
requested by the Agent, the Borrowers, the Guarantors or such Subsidiary will
set up reserves in accordance with GAAP.
SECTION 5.08. Insurance; Net Casualty/Insurance Proceeds.
(a) The Borrowers and the Guarantors will maintain
(either in the name of the Borrowers or the Guarantors), with financially sound
and reputable insurance companies with a Best's Rating of at least "A",
insurance on all of their property in at least such amounts and against at least
such risks (including on all its property, public liability and worker's
compensation (but solely with respect to worker's compensation, only to the
extent not self-insured), and business interruption insurance) as are usually
insured against in the same general area by companies of established repute
engaged in the same or similar business, subject to
71
deductibles and self insurance retentions acceptable to the Agent in its
commercially reasonable judgment. The Agent agrees that such deductibles and
self insurance retention amounts currently in place are acceptable and agrees
that it will not unreasonably withhold its approval of future modifications to
such amounts. The Borrowers shall deliver copies (which copies shall be
certified if requested by the Agent) of such policies to the Agent and with
respect to any property insurance policy related to the Collateral, with
satisfactory lender's loss payable endorsements naming the Agent, as agent for
the Lenders, as sole loss payee, as its interests may appear. Each policy of
insurance or endorsement shall contain a clause (i) not permitting cancellation
by a Borrower or Guarantor without the prior written consent of the Agent, (ii)
requiring the insurer to give not less than 30 days' prior written notice to the
Agent in the event of cancellation or non-renewal by the insurance company of
the policy for any reason whatsoever, and (iii) specifying that the interest of
the Agent shall not be impaired or invalidated by any act or neglect of the
Borrowers or the Guarantors or the owner of the property. Upon the date of this
Agreement, and from time to time thereafter upon the Agent's reasonable request,
the Borrowers and the Guarantors shall provide within a reasonable time after
such request the Agent with a statement from each insurance company providing
the foregoing coverage, acknowledging in favor of the Agent the continued
effectiveness of the foregoing insurance clauses. If any Borrower or any
Guarantor fails to provide and pay for such insurance, the Agent may, at its
option, but shall not be required to, procure the same and charge the Borrowers
therefor as a part of the Obligations.
(b) Net Casualty/Insurance Proceeds must be applied to
either (i) the payment of the Obligations, or (ii) the repair and/or restoration
of the Collateral. If either an Event of Default has occurred, or the cost to
repair or restore the Collateral exceeds $1,000,000, then, in such event, the
Agent, at the direction of the Required Lenders, shall determine, in their sole
discretion, the manner in which Net Casualty/Insurance Proceeds are to be
applied. If no Event of Default has occurred and the cost to repair or restore
the Collateral is $1,000,000 or less, the relevant Borrower shall determine the
manner in which Net Casualty/Insurance Proceeds are to be applied. The proceeds
arising under a Chubb fidelity policy involving a former employee and Xxxxxx
Communications Company relating to a claim in the amount of approximately
$3,000,000 shall not be considered Net Casualty/Insurance Proceeds hereunder.
SECTION 5.09. Change in Fiscal Year. The Parent will not
change its Fiscal Year, or the fiscal year of any Borrower or any Subsidiary,
without the consent of the Required Lenders.
SECTION 5.10. Maintenance of Property. The Borrowers and the
Guarantors shall maintain all of their respective properties and assets
reasonably necessary for the conduct of their business in reasonably good
condition, repair and working order, ordinary wear and tear excepted. The
Borrowers and the Guarantors shall maintain all Equipment reasonably necessary
for the conduct of their business in good operating condition and repair,
reasonable wear and tear excepted and all necessary replacements of and repairs
thereto shall be made so that the value and operating efficiency of such
Equipment shall be maintained and preserved, reasonable wear and tear excepted.
Without the prior written consent of the Agent, none of the Equipment may be
affixed to any real property such that it is characterized as a fixture under
applicable law, provided, however, that any Goods that, at the time of
acquisition, are intended to become an integral part of a larger whole or system
that will be installed in, and become such a part of, any building or
improvement on any Real Properties that they are not readily removable without
72
material damage to the value or usefulness of such building or improvement (such
as a heating, ventilating and air-conditioning system, but not including a
manufacturing production line), shall not constitute Equipment, shall not be
subject to the foregoing, and no such consent shall be required.
SECTION 5.11. Material Contracts. Except where the failure to
comply would not cause and would not reasonably be expected to cause a Material
Adverse Effect, each Borrower and Guarantor shall comply, and cause each other
Subsidiary to comply, with all terms and conditions of any Material Contract to
which it is a party. No Borrower or Guarantor may, without written notice to the
Agent, (a) enter into any amendment or modification to any Material Contract of
a material nature, or (b) permit any Material Contract to be cancelled or
terminated prior to its stated maturity. Each Borrower and Guarantor shall
promptly notify the Agent and deliver to the Agent any notice received by such
Borrower or Guarantor with respect to any event which constitutes a default by
such Borrower or Guarantor under any Material Contract to which such Borrower or
such Guarantor is a party or by which any of the assets of such Borrower or
Guarantor may be bound.
SECTION 5.12. Environmental Matters. Except where such actions
would not cause and would not reasonably be expected to cause a Material Adverse
Effect, the Borrowers and the Guarantors will not, and will not permit any Third
Party to, use, produce, manufacture, process, treat, recycle, generate, store,
dispose of, manage at, or otherwise handle, or ship or transport to or from the
Aggregate Real Properties any Hazardous Materials except for Hazardous Materials
such as cleaning solvents, pesticides and other similar materials used,
produced, manufactured, processed, treated, recycled, generated, stored,
disposed, managed, or otherwise handled in the ordinary course of business in
compliance with all applicable Environmental Requirements.
SECTION 5.13. Environmental Release. Each Borrower and each
Guarantor agrees that upon the occurrence of an Environmental Release at or on
any of the Aggregate Real Properties it will act in accordance with sound
business practices to investigate the extent of, and to take appropriate
remedial action to eliminate, such Environmental Release, whether or not ordered
or otherwise directed to do so by any Environmental Authority.
SECTION 5.14. Transactions with Affiliates. Other than (i)
transactions or arrangements existing on the Closing Date and described on
SCHEDULE 5.14, and (ii) transactions otherwise permitted under this Agreement,
neither the Borrowers nor the Guarantors shall be a party to any transaction
involving $1,000,000 or more with any Affiliate of the Borrowers or the
Guarantors (which Affiliate is not one of the Borrowers or one of the Guarantors
), except as permitted by law and in the ordinary course of business and
pursuant to reasonable terms which are no less favorable to such Borrower or
such Guarantor than would be obtained in a comparable arm's length transaction
with a Person which is not an Affiliate. All obligations (consisting of Debt or
otherwise) owed to any Affiliate of the Parent (other than any Borrower or
Guarantor) by any Borrower or Guarantor shall by its terms be subordinated in
full to the payment of the Obligations.
SECTION 5.15. Special Provisions Concerning Subsidiaries. The
Borrowers and Guarantors shall notify the Agent promptly upon the creation or
acquisition of any Domestic
73
Subsidiary. Neither the Borrowers nor any of the Guarantors shall hereafter
divest itself of any material assets by transferring them to any Subsidiary that
is not a Borrower or a Guarantor, except as otherwise permitted under this
Agreement. In the event that the Borrower or any Guarantor acquires or creates
any Domestic Subsidiary which is not a Borrower or a Guarantor which is a
Material Subsidiary or if any Domestic Subsidiary that is not a Borrower or a
Guarantor becomes a Material Subsidiary, then, promptly upon such event, the
Borrower or such Guarantor shall:
(a) cause such Domestic Subsidiary to execute and deliver
to the Agent a joinder agreement in the form of EXHIBIT T, pursuant to which (1)
it shall become a Guarantor and a party to the Guaranty, (2) it shall become a
"Contributing Party" and a party to the Contribution Agreement, and (3) it shall
become a party to each Security Document that is relevant to the type of assets
held by it, granting to the Agent a first priority perfected Lien in all of the
assets of the type which would constitute Collateral hereunder of such Domestic
Subsidiary subject only to Permitted Encumbrances, and deliver to the Agent
evidence of corporate authority therefor and opinions of counsel with respect
thereto, all satisfactory to the Agent in its commercially reasonable judgment;
and
(b) execute and deliver to the Agent an amendment to the
Pledge Agreement, if it is already a party thereto, otherwise a joinder
agreement in the form of EXHIBIT T becoming a party to the Pledge Agreement, in
either case pursuant to which it grants to the Agent, a first priority perfected
Lien on all of the equity interests held by it in such Domestic Subsidiary, and
in the latter case, such evidence of corporate authority therefor and opinions
of counsel with respect thereto, all satisfactory to the Agent in its
commercially reasonable judgment.
SECTION 5.16. Restricted Payments and Investments and
Acquisitions. The Parent will not declare or make any Restricted Payment during
any Fiscal Year, and the Borrowers and the Guarantors shall not, and shall not
permit any of the other Subsidiaries to, make Investments in any Person or their
assets except:
(i) loans or advances to employees not exceeding
$1,000,000 in the aggregate principal amount outstanding at
any time, in each case made in the ordinary course of business
and consistent with historical practices existing on the
Closing Date;
(ii) repurchases of Capital Stock of the Parent
from terminated or departing employees in an aggregate amount
not exceeding $500,000 for any Fiscal Year;
(iii) deposits required by government agencies,
public utilities or insurance companies;
(iv) Investments existing on the Closing Date,
including (A) existing Investments by any Borrower or
Guarantor in any other Borrower or Guarantor, (B) existing
Investments by any Borrower or Guarantor in any Subsidiary
(other than a Borrower or Guarantor), and (C) existing
Investments by any Subsidiary
74
(other than a Borrower or Guarantor) in any other Subsidiary
(other than a Borrower or Guarantor) or in any Borrower or
Guarantor;
(v) Investments in (A) direct obligations of the
United States Government or any agency thereof maturing within
one year after the date of acquisition thereof, (B) direct
obligations of any state of the United States of America or
any political subdivision of any such state or public
instrumentality thereof maturing within one year after the
date of acquisition thereof and having, at the time of
acquisition, one of the two highest ratings obtainable from
S&P or Xxxxx'x, (C) domestic and Eurodollar certificates of
deposit or time deposits maturing within 90 days after the
date of acquisition thereof issued by any commercial bank
organized under the laws of the United States of America or
any state thereof or the District of Columbia or European
Economic Community (or any member state thereof) or Canada
having combined capital and surplus of not less than
$500,000,000, (D) bankers' acceptances maturing no more than
90 days after the date of creation thereof and, at the time of
acquisition, having a rating of at least A-1 or P-1 from
either S&P or Xxxxx'x, (E) commercial paper rated "A1" or the
equivalent thereof by S&P or "P1" or the equivalent thereof by
Xxxxx'x and in either case maturing within 6 months after the
date of acquisition, (F) auction rate bonds, auction rate
preferred stock and other similar corporate securities of a
type and with terms consistent with the Borrower's short-term
investment policies and that, at the time of acquisition,
either (i) bear one of the two highest ratings obtainable from
either S&P or Xxxxx'x or (ii) are fully supported by a letter
of credit issued by a bank satisfying the criteria set forth
in clause (G) below, (G) tender bonds the payment of the
principal of and interest on which is fully supported by a
letter of credit issued by a United States bank whose
long-term certificates of deposit are rated at least "AA" or
the equivalent thereof by S&P and "Aa" or the equivalent
thereof by Xxxxx'x, (H) repurchase agreements with respect to
United States government securities, with contract periods not
to exceed 30 days, and (I) money market mutual funds that
invest primarily in the instruments set forth in the foregoing
clauses of this definition;
(vi) (A) Investments made after the Closing Date
by any Borrower or Guarantor in any other Borrower or
Guarantor, (B) Investments made after the Closing Date by any
Borrower or Guarantor in any Subsidiary (other than a Borrower
or Guarantor) in an aggregate amount (for all such
Subsidiaries) not to exceed $7,500,000 at any time
outstanding, and (C) Investments made after the Closing Date
by any Subsidiary (other than a Borrower or Guarantor) in any
other Subsidiary (other than a Borrower or Guarantor);
(vii) Restricted Payments in payment of any Debt
arising in connection with Investments permitted by SECTION
5.16 (iv) or (vi) above;
(viii) Investments as a result of Interest Rate
Protection Agreements not entered into for speculative
purposes;
75
(ix) Investments as a result of ForEx Contracts
not entered into for speculative purposes;
(x) Investments in newly created Domestic
Subsidiaries, provided that the applicable requirements of
SECTION 5.15 are satisfied;
(xi) Investments made in exchange for Capital
Stock;
(xii) Investments made with respect to Tax Related
Foreign Advances, provided that Tax Related Foreign Advances
shall not be permitted at any time during which Excess
Borrowing Availability is less than $25,000,000;
(xiii) payment of dividends in an amount not to
exceed $6,000,000 each year made in the ordinary course of
business and consistent with practices existing on the Closing
Date; and
(xiv) other Investments not existing on the
Closing Date that do not exceed $500,000;
provided, however, that immediately after giving effect to the
making of any Investment permitted by this SECTION 5.16, no default under this
SECTION 5.16 or any Event of Default shall have occurred and be continuing.
SECTION 5.17. Permitted Liens. The Borrowers and the
Guarantors will not, and will not permit any other Subsidiary to, create, assume
or suffer to exist any Lien, directly or indirectly, on any asset now owned or
hereafter acquired by it, except, (i) with respect to the Collateral, (A) the
Liens set forth on SCHEDULE 3.01, (B) Liens in favor of the Agent or the Lenders
pursuant to the Credit Documents and (C) Liens of the type set forth below in
clauses (a) through (h) and, to the extent of statutory liens only, clause (i)
below, and (ii) with respect to assets other than Collateral, the Liens set
forth in clauses (a) through (l) below:
(a) Liens existing on the date of this Agreement securing
Debt or other obligations outstanding on the date of this Agreement and
disclosed in the Collateral Disclosure Certificates;
(b) any Lien existing on any specific fixed asset of any
Person at the time such Person becomes a Subsidiary and not created in
contemplation of such event;
(c) any Lien on any specific fixed asset securing Debt
incurred or assumed for the purpose of financing all or any part of the cost of
acquiring or constructing such asset, provided that such Lien attaches to such
asset concurrently with or within 18 months after the acquisition or completion
of construction thereof;
(d) any Lien on any specific fixed asset of any Person
existing at the time such Person is merged or consolidated with or into the
Borrowers, the Guarantors or another Subsidiary and not created in contemplation
of such event;
76
(e) any Lien existing on any specific fixed asset prior
to the acquisition thereof by the Borrowers, the Guarantors or another
Subsidiary and not created in contemplation of such acquisition;
(f) Purchase Money Liens, securing Debt not to exceed
$1,000,000 in the aggregate incurred during any Fiscal Year of the Parent;
(g) any attachment or judgment Lien, unless the judgment
it secures has not, within 30 days after the entry thereof, been discharged or
execution thereof stayed pending appeal;
(h) any Lien arising out of the refinancing, extension,
renewal or refunding of any Debt secured by any Lien permitted by any of the
foregoing paragraphs of this SECTION 5.17, provided that to the extent such
paragraphs set forth a limitation thereon, (i) such Debt is not secured by any
additional assets, and (ii) the amount of such Debt secured by any such Lien is
not increased;
(i) Liens incidental to the conduct of their business or
the ownership of their assets which (i) do not secure Debt and (ii) do not in
the aggregate materially detract from the value of their assets or materially
impair the use thereof in the operation of their business;
(j) any Lien on Margin Stock;
(k) any Lien created by a Foreign Subsidiary securing
Debt as allowed under SECTION 5.20(i); and
(l) Liens not otherwise permitted by the foregoing
paragraphs of this SECTION 5.17 securing Debt in an aggregate principal amount
at any time outstanding not exceeding $500,000;
provided, however, that immediately after giving effect to the
creation, assumption, existence or incurrence of any Liens permitted by this
SECTION 5.17, no default under this SECTION 5.17 or any Event of Default shall
have occurred and be continuing.
SECTION 5.18. Restrictions on Ability of Borrower and
Subsidiaries to Pay Dividends. The Borrowers and the Guarantors shall not, and
shall not permit any other Subsidiary to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any contractual
encumbrance or restriction on the ability of any Subsidiary to (a) pay any
dividends or make any other distributions on its Capital Stock or Redeemable
Preferred Stock or any other interest or (b) make or repay any loans or advances
to the Borrowers or the Guarantors.
SECTION 5.19. Financial Covenants. The financial covenants set
forth in this SECTION 5.19 shall be determined on a consolidated basis and
tested monthly, commencing the first full Fiscal Month following the Closing
Date, and shall be in effect and applicable at all times, except that the
covenant set forth in subsection (a) of this SECTION 5.19 shall not be in effect
or applicable during any period in which Excess Borrowing Availability is, or
after giving
77
effect to the making of a Loan or the issuance of any Letter of Credit would be,
greater than or equal to $25,000,000, or on or after the Appraisal Approval
Date, $30,000,000.
(a) Fixed Charge Coverage Ratio. The Fixed Charge
Coverage Ratio will be equal to or greater than 1.25 to 1.0.
(b) Minimum Liquidity. The sum of the Excess Borrowing
Availability and Unrestricted Cash Balances shall not be any time be less than
(i) $94,000,000 from June 1, 2004 until payment of the Senior Notes that are due
on September 1, 2004; and (ii) $45,000,000 from June 1, 2005 until the
$15,000,000 payment required on the Senior Notes on August 1, 2005).
(c) Capital Expenditures. No Borrower shall, nor shall it
permit any Subsidiary to, make any expenditures (including obligations incurred
under any lease) in any Fiscal Year that are required to be capitalized under
GAAP in the aggregate for the Borrowers and the Subsidiaries, on a consolidated
basis, exceeding the amount set forth below for the Fiscal Year set forth below
plus, for each Fiscal Year, the lesser of (i) the amount permitted to be but not
expended during the prior Fiscal Year and (ii) 30% of the amount set forth below
for such prior Fiscal Year:
FISCAL YEAR MAXIMUM CAPITAL EXPENDITURE AMOUNT
----------- ----------------------------------
2003 $26,000,000
2004 $30,000,000
2005 and 2006 $34,000,000
SECTION 5.20. Permitted Debt. The Borrowers and the Guarantors
will not, and will not permit any other Subsidiary to, create, assume, incur or
suffer to exist any Debt, except as follows:
(a) (x) intercompany Debt as shown on SCHEDULE 5.20 or
otherwise arising in connection with an Investment permitted by SECTION
5.16(iv), (vi) or (xii), (v) Debt arising after the Closing Date owing by any
Borrower or Guarantor to any other Borrower or Guarantor, (w) Debt arising after
the Closing Date owing by any Subsidiary (other than a Borrower or Guarantor) to
any Borrower or Guarantor in an aggregate principal amount (for all such
Subsidiaries) not to exceed $7,500,000 at any time outstanding, (y) Debt arising
after the Closing Date owing by any Subsidiary (other than a Borrower or
Guarantor) to any other Subsidiary (other than a Borrower or Guarantor), and (z)
Debt consisting of Guarantees by the Parent, the Borrowers or any Subsidiaries
incurred in the ordinary course of business for the benefit of the Parent, the
Borrowers or any Subsidiary, provided that the primary obligation being
guaranteed is permitted by this Agreement, and provided, further, that
immediately after giving effect to the creation, assumption or incurrence of any
Debt permitted by clause (z) of this paragraph (a), no Default or Event of
Default shall have occurred and be continuing;
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(b) Debt to the Agent and the Lenders under this
Agreement and the other Credit Documents and to Wachovia or the LC Issuer under
any document or agreement pertaining to any Letter of Credit;
(c) Debt to Persons other than that described in the
foregoing clauses (a) and (b) existing on the date of this Agreement and
described in SCHEDULE 5.20;
(d) Subordinated Debt;
(e) Debt consisting of accrued pension fund and other
employee benefit plan obligations and liabilities;
(f) Debt consisting of deferred taxes;
(g) Debt resulting from endorsements of negotiable
instruments received in the ordinary course of business;
(h) Debt secured by Purchase Money Liens as permitted in
SECTION 5.17(f);
(i) (A) Debt arising in connection with trade letters of
credit, performance letters of credit or similar instruments issued for the
account of any Foreign Subsidiary in the ordinary course of such Foreign
Subsidiary's business, (B) Debt of Foreign Subsidiaries (in addition to Debt
owing to the Parent or any Subsidiary of the Parent to the extent permitted in
this SECTION 5.20) in an aggregate principal amount not to exceed $15,000,000 at
any time outstanding, and (C) (without duplication) Guarantees by the Parent,
any other Borrower or any Guarantor thereof in an aggregate principal amount not
to exceed $10,000,000 at any time outstanding;
(j) contingent obligations with respect to letters of
credit or similar instruments which have been issued but not drawn upon;
(k) Debt as a result of Interest Rate Protection
Agreements and ForEx Contracts as the same are permitted under SECTION 5.16;
(l) other Debt in an aggregate principal amount at any
time outstanding not exceeding $500,000 in the aggregate for the Borrowers, the
Guarantors and all other Subsidiaries; and
(m) Debt arising out of the refinancing, extension,
renewal or refunding of any Debt permitted by any of the foregoing paragraphs of
this SECTION 5.20 so long as, in the case of Debt permitted under clause (c),
the principal amount thereof is not increased from the amount outstanding on the
date of refinancing, and in the case of Debt permitted under clauses (i) and
(l), the principal amount thereof is not increased in violation of such clauses;
provided, however, that immediately after giving effect to the creation,
assumption, existence or incurrence of any Debt permitted by this SECTION 5.20,
no default under this SECTION 5.20 or any Event of Default shall have occurred
and be continuing.
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SECTION 5.21. Limitation on Issuance and Sale of Capital Stock
and Redeemable Preferred Stock of Subsidiaries. The Borrowers and the Guarantors
shall not, nor permit any Subsidiary to, permit any Wholly Owned Subsidiary to
issue any Capital Stock or Redeemable Preferred Stock other than to a Borrower
or one of its Wholly Owned Subsidiaries or permit any Person other than a
Borrower or one of its Wholly Owned Subsidiaries to own any Capital Stock or
Redeemable Preferred Stock of a Wholly Owned Subsidiary (other than directors'
qualifying shares); or sell any of the Capital Stock or Redeemable Preferred
Stock of a Subsidiary of a Borrower, or permit any Subsidiary of a Borrower to
sell any of the Capital Stock or Redeemable Preferred Stock of any other
Subsidiary, unless (a) such Borrower or such Subsidiary, as the case may be,
receives consideration at the time of such sale at least equal to the fair
market value of the Capital Stock and Redeemable Preferred Stock disposed of and
at least sixty percent 60% of the consideration received by such Borrower or
such Subsidiary for such Capital Stock or Redeemable Preferred Stock is in the
form of cash or cash equivalents, (b) no Default or Event of Default exists
prior to and as a result of such sale, and (c) after giving effect to any such
sale of Capital Stock or Redeemable Preferred Stock on a pro forma basis (and
the resulting elimination of such Subsidiary's accounts and inventory from the
Borrowing Base, if applicable), the Borrowers are able to borrow $1.00 or more
under SECTION 2.01(a).
SECTION 5.22. Change of Location of Collateral. None of the
Borrowers or Guarantors shall locate the Collateral consisting of Goods of the
Borrowers or the Guarantors at any location other than a Collateral Location as
set forth on the Collateral Disclosure Certificates without at least 30 days'
prior written notice to the Agent, except in any event for (a) Inventory on
consignment or subject to bailment agreements provided that the Borrowers or
Guarantors have filed a financing statement with respect to such Goods, (b)
Goods in transit from one Collateral Location to another or from a Collateral
Location to a customer location in connection with a sale, (c) metal or wooden
reels on which Goods are placed (to the extent such reels are empty of such
Goods), (d) other Goods having an aggregate value of $75,000 or less and (e)
changes in locations of Goods in connection with transactions permitted by
SECTION 5.31.
SECTION 5.23. Physical Inventories. The Borrowers and the
Guarantors shall conduct a physical inventory at all Collateral Locations (other
than such locations exempt from Xxxxxx'x annual inventory based upon cycle
counts reflecting at least 98% accuracy) no less frequently than annually and
shall provide to the Agent a report of such physical inventory promptly
thereafter, together with such supporting information as the Agent shall
reasonably request.
SECTION 5.24. Inventory Returns. If at any time or times
hereafter any Account Debtor returns any Inventory of any Borrower or Guarantor
the shipment of which generated an account on which such Account Debtor is
obligated in excess of $500,000 (or $1,000,000, as to returns due to stock
rotation pursuant to and in accordance with any distributor agreements), such
Borrower or Guarantor shall promptly notify the Agent of the same, specifying
the reason for such return and the location and condition of the returned
Inventory.
SECTION 5.25. Intellectual Property. Except in each instance
where the failure to comply with any of the following covenants (a) through (g)
would not cause and would not reasonably be expected to cause a Material Adverse
Effect:
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(a) Each Borrower and each Guarantor (either itself or
through licensees) will (i) use each Trademark on each and every trademark class
of goods applicable to its current line as reflected in its current catalogs,
brochures and price lists in order to maintain such Trademark in full force free
from any claim of abandonment for non-use, (ii) maintain as in the past the
quality of products and services offered under such Trademark, (iii) use such
Trademark with the appropriate notice of registration (if applicable) and all
other notices and legends required by applicable requirements of law, (iv) not
adopt or use any xxxx which is confusingly similar or a colorable imitation of
such Trademark unless the Agent shall obtain a perfected security interest in
such xxxx pursuant to this Agreement, and (v) not (and not permit any licensee
or sublicensee thereof to) do any act or omit to do any act whereby such
Trademark may become invalidated or impaired in any way.
(b) Each Borrower and each Guarantor (either itself or
through licensees) will not do any act, or omit to do any act, whereby any
Patent may become forfeited, abandoned or dedicated to the public, and will
continue to xxxx any products covered by such Patent as necessary and sufficient
to establish and preserve its maximum rights under applicable patent laws, to
the extent such Borrower or Guarantor deems it important to its business to
maintain such business.
(c) Each Borrower and each Guarantor (either itself or
through licensees) (i) will employ each registered Copyright and (ii) will not
(and will not permit any licensee or sublicensee thereof to) do any act or omit
to do any act whereby any portion of such Copyright may become invalidated or
otherwise impaired. Each Borrower and each Guarantor will not (either itself or
through licensees) do any act whereby any portion of such Copyright may fall
into the public domain.
(d) Each Borrower and each Guarantor (either itself or
through licensees) will not knowingly use any Intellectual Property to infringe
the intellectual property rights of any other Person.
(e) Each Borrower and each Guarantor will notify the
Agent immediately if it knows, or has reason to know, that any application or
registration relating to any Patent, registered Trademark or registered
Copyright may become forfeited, abandoned or dedicated to the public, or of any
adverse determination or development (including, without limitation, the
institution of, or any such determination or development in, any proceeding in
the United States Patent and Trademark Office, the United States Copyright
Office or any other governmental authority in any country) regarding such
Borrower's or such Guarantor's ownership of, or the validity of, such
Intellectual Property or such Borrower's or such Guarantor's right to register
the same or to own and maintain the same.
(f) Each Borrower and each Guarantor will take all
reasonable and necessary steps, including, without limitation, in any proceeding
before the United States Patent and Trademark Office, the United States
Copyright Office or any similar office or agency in any other country or any
political subdivision thereof, to maintain and pursue each application (and to
obtain the relevant registration) and to maintain each registration of the
Patents, registered Trademarks, unregistered Trademarks (to the extent that the
Borrowers or the Guarantors consider such Trademark material to such Borrower's
or Guarantor's business) and registered
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Copyrights, including, without limitation, filing of applications for renewal,
affidavits of use and affidavits of incontestability.
(g) In the event that any Intellectual Property is
infringed, misappropriated or diluted by a third party, the affected Borrower or
Guarantor shall (i) take such actions as such Borrower or such Guarantor shall
reasonably deem appropriate under the circumstances to protect such Intellectual
Property and (ii) promptly notify the Agent after it learns thereof and, if
required or advisable in the exercise of good business judgment, xxx for
infringement, misappropriation or dilution, to seek injunctive relief and to
recover any and all damages for such infringement, misappropriation or dilution.
(h) Whenever a Borrower or a Guarantor, either by itself
or through any agent, employee, licensee or designee, shall file an application
for the registration of any Patent, unregistered Trademark (to the extent that
the Borrowers or the Guarantors consider such Trademark material to such
Borrower's or Guarantor's business) or Copyright with the United States Patent
and Trademark Office, the United States Copyright Office or any similar office
or agency, such Borrower or such Guarantor shall report such filing to the Agent
within five Business Days after the last day of the fiscal quarter in which such
filing occurs. Upon request of the Agent, each Borrower and each Guarantor shall
execute and deliver, and have recorded, any and all agreements, instruments,
documents, and papers as the Agent may reasonably request to evidence the
Agent's security interest hereunder in any Copyright, Patent or Trademark and
the goodwill and general intangibles of the Borrower or the Guarantor relating
thereto or represented thereby, provided, however, no instruments or documents
related to the Agent's security interest in any Copyright, Patent or Trademark
will be executed or delivered or any other actions taken by the Agent with
respect to the laws of any foreign jurisdiction.
SECTION 5.26. Records Respecting Collateral. The principal
records of the Borrowers and the Guarantors with respect to the Collateral will
be kept at their respective Executive Offices and will not be removed from such
address without the prior written consent of Agent.
SECTION 5.27. Reports Respecting Collateral. The Borrowers and
the Guarantors shall, as soon as practicable, but in any event on or before 15
days after the end of each Fiscal Month, furnish or cause to be furnished to the
Agent a status report, certified by a duly authorized officer of Borrowers and
Guarantors, showing: (a) the aggregate dollar value of the Collateral comprising
the Accounts and the age of each individual item thereof as of the last day of
the preceding Fiscal Month (segregating such items in such manner and to such
degree as the Agent may request in its commercially reasonable judgment,
including, without limitation, by Account Debtor name, address, invoice number,
due date and invoice date); (b) the aggregate dollar value of the Accounts
subject to "xxxx and hold" arrangements (segregating such items in such manner
and to such degree as the Agent may request in its commercially reasonable
judgment); (c) the aggregate dollar value of the items comprising the accounts
payable of the Borrowers and the Guarantors and the age of each individual item
thereof as of the last day of the preceding Fiscal Month (segregating such items
in such manner and to such degree as the Agent may request in its commercially
reasonable judgment); (d) the type, age, dollar value and location of the
Inventory as at the end of the preceding Fiscal Month, valued at the lower of
its FIFO cost or market value; and (e) the aggregate dollar value of all
returns, repossessions or
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discounts with respect to Inventory in excess of $1,000,000. Additionally, the
Agent may, at any time in its commercially reasonable judgment (and upon prior
notice to the Parent if no Event of Default has occurred and is continuing),
require the Borrowers or the Guarantors to permit the Agent in its own name or
any designee of the Agent in its own name to verify the individual account
balances of or any other matter relating to the individual Account Debtors
promptly upon its request therefor by mail, telephone, telegraph or otherwise.
The Borrowers and the Guarantors shall cooperate fully with the Agent in an
effort to facilitate and promptly conclude any such verification process. In any
event, with the above described status report for the month of December of each
year and upon reasonable request from the Agent made at any time hereafter, the
Borrowers and the Guarantors shall furnish the Agent with a then current
customer and Account Debtor name and address list, together with (if requested
by the Agent in its commercially reasonable judgment) updates of Equipment
lists, and updates of the appraisal of the Equipment after the Appraisal
Approval Date, and inventory appraisals or updates of previously furnished
inventory appraisals. Upon the Agent's commercially reasonable request therefor,
the Borrowers and the Guarantors shall deliver to the Agent copies of proof of
delivery and the original copy of all documents, including, without limitation,
repayment histories and present status reports relating to all accounts listed
on any Borrowing Base Certificate and such other matters and information
relating to the status of the Accounts of the Borrowers and the Guarantors as
the Agent shall reasonably request.
SECTION 5.28. Collateral Location Waivers. With respect to
each of the Collateral Locations at which are Borrower or Guarantor maintains
Collateral having a value in excess of $100,000, the Borrowers and the
Guarantors will use reasonable best efforts to obtain such waivers of lien,
estoppel certificates or subordination agreements as the Agent may reasonably
require to insure the priority of its security interest in that portion of the
Collateral situated at such locations.
SECTION 5.29. Appraisals; Field Examinations. The Agent
reserves the right, exercisable from time to time hereafter in its commercially
reasonable judgment to require that the Borrowers and/or the Guarantors obtain,
and the Borrowers and/or the Guarantors shall so obtain, at the Borrowers'
expense, appraisals reflecting then current values of the Accounts and
Inventory. After the Appraisal Approval Date, the Agent reserves the right,
exercisable from time to time hereafter in its commercially reasonable judgment,
to require that the Borrowers and/or the Guarantors obtain, and the Borrowers
and/or the Guarantors shall so obtain, at the Borrowers' expense, appraisals
reflecting then current values of the Equipment. The Agent anticipates that it
will conduct 2 field examinations per year, but reserves the right, exercisable
from time to time hereafter, to conduct field examinations on a more frequent
basis in its commercially reasonable judgment, and all such field examinations
shall be at the Borrowers' expense.
SECTION 5.30. Payment of Taxes On and Use of Collateral. The
Borrowers and Guarantors shall timely pay all taxes and other charges against
the Collateral except liabilities being contested in good faith and other
liabilities the nonpayment of which would not otherwise violate the provisions
of this Article 5, and the Borrowers will not use the Collateral illegally.
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SECTION 5.31. Dispositions of Collateral.
(a) Except for (i) sales or other dispositions of
Inventory in the ordinary course of business, (ii) sales, leases or transfers
among the Borrowers and the Guarantors, and (iii) dispositions of Equipment
pursuant to SECTION 5.31(b), neither any of the Borrowers nor any of the
Guarantors will sell, lease, exchange, arrange for a sale and leaseback, or
otherwise dispose of any of the Collateral without the prior written consent of
the Agent, acting at the direction of (A) as to Collateral of the types
described in the definition and used in the calculation of the Borrowing Base,
all of the Lenders, and (B) as to all other Collateral, the Required Lenders;
provided, however, that for the avoidance of doubt, this SECTION 5.31 shall not
be deemed to restrict the Borrowers' or the Guarantors' dispositions of
Collateral consisting of money, cash or cash equivalents.
(b) Except for sales, leases or transfers among the
Borrowers and Guarantors, neither any of the Borrowers nor any of the Guarantors
will sell, lease, exchange, arrange for a sale and leaseback, or otherwise
dispose of any of the Equipment without the prior written consent of the Agent;
provided, however, that, with notice to, but without the necessity of consent
of, the Agent, from time to time hereafter, in the ordinary course of any
Borrower's or any Guarantor's business, such Borrower or Guarantor may (i) sell,
lease, exchange, arrange for a sale and leaseback or otherwise dispose of such
portions of its Equipment which in the aggregate during any Fiscal Year, has a
market value or a book value, whichever is more, of $5,000,000 or less,
provided, that the Amortizing Equipment Availability Amount shall be reduced by
the amount of the proceeds from such sales of such sold Equipment that was
included in such calculation (if such Equipment was, immediately prior to the
sale thereof, included in the Amortizing Equipment Availability Amount), and
provided further that no default under this SECTION 5.31 or any Event of Default
exists, and (ii) sell, exchange or otherwise dispose of portions of its
Equipment which are obsolete, worn-out or unsuitable for continued use by the
Borrower or such Guarantor if (unless the Borrower or such Guarantor determines
in its commercially reasonable good faith judgment that replacement is not
necessary in the continued operation of its business) such Equipment is replaced
promptly upon its disposition and (if so replaced other than through (x) the
incurrence of Debt secured by a Purchase Money Lien permitted under SECTION 5.20
or (y) an operating lease) in which the Agent shall obtain and have a first
priority security interest pursuant hereto subject only to Permitted
Encumbrances.
SECTION 5.32. Changes to Federal Taxpayer Identification
Number; Organizational Identification Number. None of the Borrowers or
Guarantors may change its federal taxpayer identification number without 30
days' prior written notice to the Agent. If a Borrower or a Guarantor does not
have an organizational identification number as of the Closing Date, but
receives one at a later date, it will promptly notify Agent of its
organizational identification number. Each Borrower and each Guarantor will
promptly notify the Agent of any change in its organizational identification
number.
SECTION 5.33. Discounts and Allowances. Upon the granting of
any discounts, allowances or credits by a Borrower or a Guarantor in excess of
$250,000 or not in the ordinary course of business and which in either case are
not shown on the face of the invoice for the Account involved, such Borrower or
such Guarantor shall promptly report such discounts, allowances or credits, as
the case may be, to the Agent and in no event later than the time of its
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submission to the Agent of the next status report as required by SECTION 5.27.
In the event any amounts due and owing in excess of $250,000 are in dispute
between any Borrower or Guarantor and any Account Debtor, such Borrower or such
Guarantor shall provide the Agent with a report thereon, explaining in detail
the reason for the dispute, all claims related thereto and the amount in
controversy. During the existence of an Event of Default, and without affecting
the Borrowers' liability with respect to the Obligations (except that the
Borrowers will receive a credit for the amounts collected), the Agent, in the
exercise of its commercially reasonable discretion, may settle disputes and
otherwise deal with the Account Debtors and the Borrowers shall reimburse the
Agent as a part of the Obligations any reasonable out-of-pocket expenses
incurred by the Agent in connection therewith.
SECTION 5.34. Taxes Owing with Respect to Accounts. If an
Account of any Borrower or any Guarantor includes a charge for any tax payable
to any governmental taxing authority, the Agent is authorized, in its sole
discretion, after giving notice to the Borrowers and allowing the Borrowers
thirty (30) calendar days to pay, to pay the amount thereof to the proper taxing
authority for the Account of such Borrower or such Guarantor.
SECTION 5.35. Commercial Tort Claims. Each Borrower and each
Guarantor shall, within 30 days after each Borrower or each Guarantor makes a
filing or appearance in court with respect to its assertion of a Commercial Tort
Claim for damages equal to or exceeding $250,000 (which amount, if not expressly
set forth in a filing, shall be the amount the Borrower or the Guarantor in good
faith believes to be such amount of damages), send the Agent and the Lenders
written notice, signed by the relevant Borrower or Guarantor, containing the
following: (a) a summary description of the parties involved, the amount claimed
for damages by the relevant Borrower or Guarantor, and the events that gave rise
to such Commercial Tort Claim, and (b) a grant of a security interest in such
Commercial Tort claim in favor of the Agent for the benefit of the Lenders. The
Agent is hereby authorized to amend any financing statements in order to include
such Commercial Tort Claim.
SECTION 5.36. Senior Note Purchase Agreements. Borrowers shall
not amend or modify either of the Senior Note Purchase Agreements or guaranties
related thereto in any material respect without the prior written consent of the
Agent (acting at the direction of the Required Lenders) which consent shall not
be unreasonably withheld or delayed.
SECTION 5.37. Other Restrictive Agreements. Except in
agreements pertaining to Liens permitted under SECTION 5.17, neither the
Borrowers nor any Domestic Subsidiary will become bound by any provision not in
existence on the Closing Date contained in any other agreement that directly or
indirectly prohibits, materially restrains or imposes materially adverse
conditions on (including the requirement for an equal and ratable Lien), the
ability of the Borrower or its Domestic Subsidiaries to create any Lien on any
of its assets in favor of the Agent to secure the Obligations.
ARTICLE 6
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the
following events ("Events of Default") shall have occurred and be continuing:
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(a) any Borrower shall fail to pay when due (i) any
principal of any Loan, or any Reimbursement Obligations with respect to any
Letter of Credit when such amount becomes due, (ii) any interest on any Loan,
any fee in any Credit Documents or other Obligations (except as provided in
(a)(iii) below) within 5 days after such interest, fee or other Obligations
becomes due, or (iii) any Obligations of the type described in clauses (c) and
(d) of the definition of "Obligations" within 10 days after written notice
thereof has been given to the Borrowers by the Agent; or
(b) any Borrower or any Guarantor shall fail to observe
or perform any covenant contained in SECTIONS 5.01(g), 5.02(a)(ii), 5.02(b),
5.03 through 5.06, inclusive, 5.08 (but only with respect to insurance regarding
Collateral), 5.15, 5.16, and 5.18 through 5.21, inclusive; or
(c) any Borrower or any Guarantor shall fail to observe
or perform any covenant or agreement contained or incorporated by reference in
this Agreement (other than those covered by paragraph (a) or (b) above) or any
Credit Document and such failure shall not have been cured within 30 days after
the earlier to occur of (i) written notice thereof has been given to the
Borrowers by the Agent or (ii) any Senior Officer otherwise becomes actually
aware of any such failure; or
(d) any representation, warranty, certification or
statement made by any Borrower or any Guarantor in ARTICLE 4 of this Agreement
or in any certificate, financial statement or other document delivered pursuant
to this Agreement or any other Credit Document shall prove to have been
incorrect (including by virtue of a material omission) in any material respect
when made (or deemed made); or
(e) any Borrower or any Guarantor shall fail to make any
payment in respect of Debt outstanding (other than the Notes) in an aggregate
principal amount greater than $3,000,000 when due, after taking into account any
applicable grace period; or
(f) any event or condition shall occur which results in
the acceleration of the maturity of Debt outstanding of any Borrower or any
Subsidiary in an aggregate principal amount greater than $3,000,000 (including,
without limitation, any required mandatory prepayment or "put" of such Debt to
any Borrower or any Subsidiary) or enables the holders of such Debt or
commitment or any Person acting on such holders' behalf to accelerate the
maturity thereof or terminate any such commitment prior to its normal expiration
(including, without limitation, any required mandatory prepayment or "put" of
such Debt to, any Borrower or any Subsidiary); or
(g) any Borrower or any Subsidiary shall commence a
voluntary case or other proceeding seeking liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally,
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or shall admit in writing its inability, to pay its debts as they become due, or
shall take any corporate action to authorize any of the foregoing; or
(h) an involuntary case or other proceeding shall be
commenced against any Borrower or any Subsidiary seeking liquidation,
reorganization or other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its property, and such
involuntary case or other proceeding shall remain undismissed and unstayed for a
period of 60 days; or an order for relief shall be entered against any Borrower
or any Subsidiary under the federal bankruptcy laws as now or hereafter in
effect; or
(i) any Borrower, any Subsidiary or any member of the
Controlled Group shall fail to pay when due any material amount which it shall
have become liable to pay to the PBGC or to a Plan under Title IV of ERISA; or
notice of intent to terminate a Plan or Plans shall be filed under Title IV of
ERISA by any Borrower, any Subsidiary, any member of the Controlled Group, any
plan administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate or to cause a trustee
to be appointed to administer any such Plan or Plans or a proceeding shall be
instituted by a fiduciary of any such Plan or Plans to enforce Section 515 or
4219(c)(5) of ERISA and such proceeding shall not have been dismissed within 30
days thereafter; or a condition shall exist by reason of which the PBGC would be
entitled to obtain a decree adjudicating that any such Plan or Plans must be
terminated provided each of the foregoing described in this SECTION 6.01(i) only
if it results in an unfunded vested liability under a Plan that is $3,000,000 or
more; or
(j) (i) one or more judgments or orders of any court or
other judicial body for the payment of money in an aggregate amount in excess of
$3,000,000 (in excess of amounts covered by insurance) shall be rendered after
the Closing Date against any of the Parent, any Borrower or any Subsidiary and
such judgment or order shall continue unsatisfied and unstayed for a period of
30 days or give rise to a Lien on any Collateral at any time unless the judgment
or order it secures has not, within 30 days after the entry thereof, been
discharged or execution thereof stayed pending appeal; or (ii) a warrant or writ
of attachment or execution or similar process shall be issued against any
property of any Borrower or any Subsidiary which exceeds, individually or
together with all other such warrants, writs and processes since the Closing
Date, $3,000,000 (in excess of amounts covered by insurance) and such warrant,
writ or process shall not be discharged, vacated, stayed or bonded for a period
of 30 days; provided, however, that in the event a bond has been issued in favor
of the claimant or other Person obtaining such attachment or writ, the issuer of
such bond shall execute a waiver or subordination agreement in form and
substance satisfactory to the Agent pursuant to which the issuer of such bond
subordinates its right of reimbursement, contribution or subrogation to the
Obligations and waives or subordinates any Lien it may have on the assets of any
Borrower or any Subsidiary; or
(k) (i) any Person or two or more Persons acting in
concert shall have acquired beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission under the Securities Exchange
Act of 1934) of 20% or more of the outstanding shares of the voting stock of the
Parent; or (ii) as of any date a majority of the Board of Directors of the
Borrower consists of individuals who were not either (A) directors of the
Borrower as of
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the corresponding date of the previous year, (B) selected or nominated to become
directors by the Board of Directors of the Borrower of which a majority
consisted of individuals described in clause (A), or (C) selected or nominated
to become directors by the Board of Directors of the Borrower of which a
majority consisted of individuals described in clause (A) and individuals
described in clause (B); or
(l) if, on any day, any Borrower could not truthfully
make the representations and warranties contained in SECTION 4.16; or
(m) there shall have occurred material uninsured damage
to, or loss, theft or destruction of, any material part of the Collateral, or
any security interest of the Agent in any material part of the Collateral,
ceases to be a first priority security interest or Lien, except for Permitted
Encumbrances (other than those described in SECTION 5.17(g) and those described
in SECTION 5.17(i) that are not statutory liens), or any Guarantor shall
terminate or repudiate the Guaranty or the Guaranty shall be declared
unenforceable or the Guaranty shall no longer be in full force and effect; or
(n) any Borrower or any Guarantor repudiates, revokes or
attempts to repudiate or revoke its obligations with respect to the Obligations
or under the Credit Documents to which it is a party; or
(o) any strike, lockout, labor dispute, embargo,
condemnation, act of God or public enemy, or other casualty or injunction, court
order, or order or act of a governmental authority which causes, for more than
30 consecutive days beyond the coverage period of any applicable business
interruption insurance, the cessation or substantial curtailment of revenue
producing activities at any facility of any Borrower or any Subsidiaries if any
such event or circumstance would cause or would reasonably be expected to cause
a Material Adverse Effect;
then, and in every such event, the Agent will, if requested by the Required
Lenders and the Agent: (i) by notice to the Borrowers terminate the Commitments
and they shall thereupon terminate and terminate the LC Issuer's obligations to
issue Letters of Credit hereunder; (ii) by notice to the Borrowers declare the
Notes (together with accrued interest thereon), and all other amounts payable
hereunder and under the other Credit Documents, to be, and the same shall
thereupon become immediately due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by the
Borrowers together with interest at the Default Rate accruing on the principal
amount thereof from and after the date of such Event of Default; provided that
if any Event of Default specified in paragraph (g) or (h) above occurs with
respect to the Borrowers, without any notice to the Borrowers or any other act
by the Agent or the Lenders, the Commitments shall thereupon terminate and the
Notes (together with accrued interest thereon) and all other amounts payable
hereunder and under the other Credit Documents shall automatically and without
notice become immediately due and payable without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by the Borrowers
together with interest thereon at the Default Rate accruing on the principal
amount thereof from and after the date of such Event of Default; or (iii)
exercise any rights, powers or remedies under this Agreement and the other
Credit Documents. In addition, upon the occurrence of an Event of Default, to
the extent of any existing Letter of Credit Obligations, the Agent may
immediately advance the amount thereof as a Revolving Loan and set aside the
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amounts so advanced as a collateral reserve for payment of the Reimbursement
Obligations relating to Letters of Credit which are subsequently funded. After
all Letters of Credit have been cancelled and all Reimbursement Obligations have
been satisfied, and the LC Issuer has been reimbursed all amounts funded by it
with respect thereto, any balance remaining in said collateral reserve may be
applied to other amounts owed by the Borrowers hereunder, and, if none, shall be
remitted to the relevant Borrower. Notwithstanding the foregoing, the Agent
shall have available to it all other remedies at law or equity, and shall
exercise any one or all of them at the request of the Required Lenders. In no
event may any Lender or Lenders exercise any rights, remedies or powers with
respect to the Obligations of the types described in clauses (a) and (b) of the
definition thereof, this Credit Agreement and the other Credit Documents without
the consent of the Agent and the Required Lenders.
SECTION 6.02. Notice of Default. The Agent shall give notice
to the Borrowers of any Default promptly upon being requested to do so by any
Lender and shall thereupon notify all the Lenders thereof.
SECTION 6.03. Remedies with Respect to Collateral.
(a) Upon the occurrence of an Event of Default, the Agent
or any representative of Agent shall have the rights and remedies of a secured
party under the UCC in effect on the date thereof (regardless of whether the
same has been enacted in the jurisdiction where the rights or remedies are
asserted), including, without limitation, the right to require the Borrowers and
the Guarantors to assemble the Collateral, at the Borrowers' expense, and make
it available to the Agent at a place designated by the Agent which is reasonably
convenient to both parties, and enter any premises where any of the Collateral
shall be located and to keep and store the Collateral on said premises until
sold (and if said premises be the property of any Borrower, any Guarantor or any
of its Subsidiaries, such Borrower or such Guarantor agrees not to charge the
Agent for storage thereof), to take possession of any of the Collateral or the
proceeds thereof, to sell or otherwise dispose of the same, and the Agent shall
have the right to conduct such sales on the premises of the Borrowers or the
Guarantors, without charge therefor, and such sales may be adjourned from time
to time in accordance with applicable law. The Agent may sell, lease or dispose
of Collateral for cash, credit, or any combination thereof, and shall have the
right to appoint a receiver of the Accounts and the Inventory or any part
thereof, and the right to apply the proceeds therefrom as set forth in SECTION
6.03(b) below. The Agent shall give the Borrowers and the Guarantors written
notice of the time and place of any public sale of the Collateral or the time
after which any other intended disposition thereof is to be made. The
requirement of sending reasonable notice shall be met if such notice is given to
the Borrowers and the Guarantors at least 10 days before such disposition.
Expenses of retaking, verifying, restoring, holding, insuring, collecting,
preserving, liquidating, protecting, preparing for sale or selling, or otherwise
disposing of or the like with respect to the Collateral shall include, in any
event, reasonable attorneys' fees and other legally recoverable collection
expenses, all of which shall constitute a part of the Obligations.
(b) Proceeds of any of the Collateral and payments by the
Borrowers or the Guarantors during the existence of an Event of Default received
by the Agent or any Lender shall be applied by the Agent in accordance with the
provisions of SECTION 2.12(h), and, after all of the Obligations have been paid
in full and no Letters of Credit, ForEx Obligations, or Interest
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Rate Protection Agreement or liability with respect thereto remains outstanding,
then, such excess proceeds shall be payable to the Borrowers and the Guarantors
(as they may direct) or any other Person as required by applicable law. In the
event that the proceeds of the Collateral are not sufficient to pay the
Obligations in full, the Borrowers and the Guarantors shall remain liable for
any deficiency.
(c) To the extent permitted by law, the Borrowers and the
Guarantors hereby waive all rights which the Borrowers and the Guarantors have
or may have to notice and to a judicial hearing prior to seizure of any
Collateral by the Agent.
(d) Unless and except to the extent expressly provided
for to the contrary herein, the rights of the Agent specified herein shall be in
addition to, and not in limitation of, the Agent's or Lender's rights under the
UCC, or any other statute or rule of law or equity, or under any other provision
of any of the Credit Documents, or under the provisions of any other document,
instrument or other writing executed by the Borrowers or the Guarantors in favor
of Agent, all of which may be exercised successively or concurrently.
(e) Upon the occurrence and during the continuance of an
Event of Default, the Agent is granted a license or other right to use, without
charge, Borrowers' and Guarantors' labels, patents, copyrights, rights of use of
any name, trade secrets, tradenames, trademarks and advertising matter, or any
Intellectual Property of a similar nature, as it pertains to the Collateral, in
advertising for sale and selling any Collateral, and the Borrowers' and the
Guarantors' rights under all licenses and all franchise agreements shall inure
to the Agent's benefit in such regard.
(f) Neither the Agent nor any Lender shall be liable or
responsible in any way for the safekeeping of any of the Collateral or for any
loss or damage thereto (except the Agent or the Lenders for reasonable care in
the custody thereof while any Collateral is in the Agent's or Lenders' actual
possession) or for any diminution in the value thereof, or for any act or
default of any warehouseman, carrier, forwarding agency, or other person
whomsoever, but the same shall be at the Borrowers' and the Guarantors' sole
risk.
(g) Neither the Agent nor any Lender shall be under any
obligation to marshal any assets in favor of any of the Borrowers, the
Guarantors or any other Person or against or in payment of any or all of the
Obligations.
SECTION 6.04. Power of Attorney. Each Borrower and each
Guarantor irrevocably designates and appoints the Agent its true and lawful
attorney, during the existence of an Event of Default, either in the name of the
Agent or in the name of such Borrower or such Guarantor to ask for, demand, xxx
for, collect, compromise, compound, receive, receipt for and give acquittances
for any and all sums owing or which may become due upon any items of the
Inventory or the Accounts and, in connection therewith, to take any and all
actions as the Agent may deem necessary or desirable to realize upon the
Inventory and the Accounts, including, without limitation, power to endorse in
the name of such Borrower or such Guarantor, any checks, drafts, notes or other
instruments received in payment of or on account of the Inventory or the
Accounts, but the Agent shall not be under any duty to exercise any such
authority or power or in any way be responsible for the collection of the
Inventory or the Accounts.
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ARTICLE 7
THE AGENT AND THE LENDERS
SECTION 7.01. Appointment; Powers and Immunities.
(a) Each Lender (and Wachovia or the LC Issuer, as
applicable, with respect to the Letter of Credit Obligations and the ForEx
Obligations) hereby irrevocably appoints and authorizes the Agent (including its
successors by merger) to act as its agent hereunder and under the other Credit
Documents with such powers as are specifically delegated to the Agent by the
terms hereof and thereof, together with such other powers as are reasonably
incidental thereto. The Agent: (i) shall have no duties or responsibilities
except as expressly set forth in this Agreement and the other Credit Documents,
and shall not by reason of this Agreement or any other Credit Document be a
trustee for any Lender; (ii) shall not be responsible to the Lenders for any
recitals, statements, representations or warranties contained in this Agreement
or any other Credit Document, or in any certificate or other document referred
to or provided for in, or received by any Lender under this Agreement or any
other Credit Document, or for the validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Credit Document or
any other document referred to or provided for herein or therein or for any
failure by any Borrower or any Guarantor to perform any of its obligations
hereunder or thereunder; (iii) shall not be required to initiate or conduct any
litigation or collection proceedings hereunder or under any other Credit
Document except to the extent requested by the Required Lenders, and then only
on terms and conditions which do not, in the reasonable judgment of the Agent,
subject the Agent to any undue risk; and (iv) shall not be responsible for any
action taken or omitted to be taken by it hereunder or under any other Credit
Document or any other document or instrument referred to or provided for herein
or therein or in connection herewith or therewith, except for its own gross
negligence or willful misconduct. The Agent may employ agents and
attorneys-in-fact and shall not be responsible for the negligence or misconduct
of any such agents or attorneys-in-fact selected by it with reasonable care.
Except to the extent the Borrowers are given rights under SECTION 7.09 and
SECTION 7.14, the provisions of this ARTICLE 7 are solely for the benefit of the
Agent and the Lenders, and no Borrower or Guarantor shall have any rights as a
third party beneficiary of any of the provisions hereof. In performing its
functions and duties under this Agreement and under the other Credit Documents,
the Agent shall act solely as agent of the Lenders and does not assume and shall
not be deemed to have assumed any obligation towards or relationship of agency
or trust with or for the Borrowers or the Guarantors. The duties of the Agent
shall be ministerial and administrative in nature, and the Agent shall not have
by reason of this Agreement or any other Credit Document a fiduciary
relationship in respect of any Lender. The Agent shall remit to the Lenders, as
soon as reasonably practical following receipt thereof, all payments and other
amounts received by it hereunder for the account of the Lenders.
(b) Unless and until its authority to do so is revoked in
writing by the Required Lenders, the Agent alone shall be authorized to
determine hereunder whether any accounts or inventory of any Borrower or any
Guarantor constitute Eligible Accounts or Eligible Inventory, or whether to
impose or release any reserve, and to exercise its own credit judgment in
connection therewith, which determinations and judgments, if exercised in good
faith, shall exonerate Agent from any liability to any Lender or any other
Person for any errors in judgment.
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(c) As between the Agent and the Lenders, the Agent shall
have the sole and exclusive right and authority to (i) act as the disbursing and
collecting agent for the Lenders with respect to all payments and collections
arising in connection with this Agreement and the other Credit Documents; (ii)
execute and deliver each Credit Document (other than this Credit Agreement) on
behalf of the Lenders and accept delivery of each such agreement delivered by
any Borrower, any Guarantor or any other Person; (iii) act as collateral agent
for the Lenders for purposes of the perfection of all security interests and
Liens created by this Agreement or the Security Documents with respect to all
material items of the Collateral and, subject to the direction of the Required
Lenders where applicable, for all other purposes stated therein; (iv) subject to
the direction of the Required Lenders where applicable, manage, supervise or
otherwise deal with the Collateral; and (v) except as may be otherwise
specifically restricted by the terms of this Agreement and subject to the
direction of the Required Lenders, exercise all remedies given to the Agent or
Lenders with respect to any of the Collateral under the Credit Documents
relating thereto, or under applicable law or otherwise. As to any matters not
expressly provided for otherwise by this Agreement or any other Credit Document,
the Agent shall in all cases be fully protected in acting, or in refraining from
acting, hereunder and thereunder in accordance with instructions signed by the
Required Lenders, and such instructions of the Required Lenders to the Agent in
any action taken or failure to act pursuant thereto shall be binding on all of
the Lenders.
SECTION 7.02. Reliance by Agent. The Agent shall be entitled
to rely upon any certification, notice or other communication (including any
thereof by telephone, telecopier, telegram or cable) believed by it to be
genuine and correct and to have been signed or sent by or on behalf of the
proper Person or Persons, and upon advice and statements of legal counsel,
independent accountants or other experts selected by the Agent.
SECTION 7.03. Defaults. The Agent shall not be deemed to have
knowledge of the occurrence of a Default or an Event of Default (other than the
nonpayment of any of the Obligations) unless the Agent has received written
notice from a Lender or any Borrower or any Guarantor specifying such Default or
Event of Default and stating that such notice is a "Notice of Default," each of
the Lenders hereby agreeing to promptly notify in writing the Agent of any
Default to which such Lender obtains knowledge. In the event that the Agent
receives such a notice of the occurrence of a Default or an Event of Default,
the Agent shall give prompt notice thereof to the Lenders. The Agent shall give
each Lender prompt notice of each nonpayment of any of the Obligations whether
or not it has received any notice of the occurrence of such nonpayment.
SECTION 7.04. Rights of Agent and its Affiliates as a Lender.
With respect to the Loans made by the Agent and any Affiliate of the Agent,
Wachovia in its capacity as a Lender hereunder and any Affiliate of the Agent or
such Affiliate in its capacity as a Lender hereunder shall have the same rights
and powers hereunder as any other Lender and may exercise the same as though
Wachovia were not acting as the Agent, and the term "Lender" or "Lenders" shall,
unless the context otherwise indicates, include Wachovia in its individual
capacity and any Affiliate of the Agent in its individual capacity. The Agent
and any Affiliate of the Agent may (without having to account therefor to any
Lender) accept deposits from, lend money to and generally engage in any kind of
banking, trust or other business with the Borrowers and the Guarantors (and any
of the Borrowers' or Guarantors' Affiliates) as if
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Wachovia were not acting as the Agent, and the Agent and any Affiliate of the
Agent may accept fees and other consideration from the Borrowers or Guarantors
(in addition to any agency fees and arrangement fees heretofore agreed to
between the Borrowers and the Agent) for services in connection with this
Agreement or any other Credit Document or otherwise without having to account
for the same to the Lenders and Agent shall not be subject to any liability by
reason of its acting or refraining to act pursuant to any request of the
Required Lenders except as a result of its own willful misconduct or gross
negligence.
SECTION 7.05. Indemnification. Each Lender severally agrees to
indemnify the Agent and hold the Agent harmless from, to the extent the Agent
shall not have been reimbursed by the Borrowers, ratably in accordance with its
Commitment, for any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits (including, without limitation, counsel
fees and disbursements), and costs and expenses (but not fees) Agent may be
required to bear with respect to any lockbox or collateral collection account
arrangement, or disbursements of any kind and nature whatsoever which may be
imposed on, incurred by or asserted against the Agent in any way relating to or
arising out of this Agreement or any other Credit Document or any other
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby (excluding, unless an Event of Default has
occurred and is continuing, the normal out-of-pocket administrative costs and
expenses incident to the performance of its agency duties hereunder) or the
enforcement of any of the terms hereof or thereof or any such other documents;
provided that no Lender shall be liable for any of the foregoing to the extent
they arise from the gross negligence or willful misconduct of the Agent. If any
indemnity furnished to the Agent for any purpose shall, in the opinion of the
Agent, be insufficient or become impaired, the Agent may call for additional
indemnity and cease, or not commence, to do the acts indemnified against until
such additional indemnity is furnished.
SECTION 7.06. Payee of Note Treated as Owner. The Agent may
deem and treat each Person in whose name a Loan is registered as the owner
thereof for all purposes hereof unless and until a written notice of the
assignment or transfer thereof shall have been filed with the Agent and the
provisions of SECTION 10.08(c) have been satisfied. Any requests, authority or
consent of any Person who at the time of making such request or giving such
authority or consent is the holder of any Note shall be conclusive and binding
on any subsequent holder, transferee or assignee of that Note or of any Note or
Notes issued in exchange therefor or replacement thereof.
SECTION 7.07. Nonreliance on Agent and Other Lenders. Each
Lender agrees that it has, independently and without reliance on the Agent or
any other Lender, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of the Borrowers and the Guarantors
and decision to enter into this Agreement and that it will, independently and
without reliance upon the Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own analysis and decisions in taking or not taking action under this Agreement
or any of the other Credit Documents. Except as expressly provided in SECTION
7.03, the Agent shall not be required to keep itself (or any Lender) informed as
to the performance or observance by the Borrowers of this Agreement or any of
the other Credit Documents or any other document referred to or provided for
herein or therein or to inspect the properties or books of the Borrowers, the
Guarantors or any other Person. Except for notices, reports and other documents
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and information expressly required to be furnished to the Lenders by the Agent
hereunder or under the other Credit Documents, the Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the affairs, financial condition or business of the Borrowers, the
Guarantors or any other Person (or any of their Affiliates) which may come into
the possession of the Agent.
SECTION 7.08. Failure to Act. Except for action expressly
required of the Agent hereunder or under the other Credit Documents, the Agent
shall in all cases be fully justified in failing or refusing to act hereunder
and thereunder unless it shall receive further assurances to its satisfaction by
the Lenders of their indemnification obligations under SECTION 7.05 against any
and all liability and expense which may be incurred by the Agent by reason of
taking, continuing to take, or failing to take any such action. In any event, if
the Agent requests in writing the authorization or direction of the Required
Lenders (or all Lenders if required) and the Lenders do not timely respond to
such request in writing, the Agent may act or refrain from acting with respect
to the matters set forth in such request by the Agent without liability to any
of the Lenders with respect to such matters.
SECTION 7.09. Resignation of Agent. Subject to the appointment
and acceptance of a successor Agent as provided below, the Agent may resign at
any time by giving notice thereof to the Lenders and the Borrowers. Upon any
such resignation the Required Lenders shall have the right to appoint a
successor Agent, subject to the consent of the Borrowers, if no Event of Default
is in existence, which consent shall not be unreasonably withheld or delayed. If
no successor Agent shall have been so appointed by the Required Lenders and
shall have accepted such appointment within 30 days after the retiring Agent's
notice of resignation, then the retiring Agent may, on behalf of the Lenders and
after consultation with the Borrowers, appoint a successor Agent. Any successor
Agent shall be a Lender hereunder or other bank or financial institution which
has a combined capital and surplus of at least $500,000,000. Upon the acceptance
of any appointment as Agent hereunder by a successor Agent, such successor Agent
shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations hereunder. After any retiring Agent's
resignation hereunder as Agent, the provisions of this ARTICLE 7 shall continue
in effect for its benefit in respect of any actions taken or omitted to be taken
by it while it was acting as the Agent hereunder.
SECTION 7.10. Joinder of Lenders. The rights, remedies, powers
and privileges conferred upon the Agent hereunder and under the other Credit
Documents may be exercised by the Agent without the necessity of the joinder of
any other parties unless otherwise required by applicable law.
SECTION 7.11. Agreements Regarding Collateral. Each Lender
shall have an interest, in accordance with its Commitment Percentage, in the
security interests and Liens in and to the Collateral and any other assets
granted and assigned to the Agent under the Credit Documents. The Lenders hereby
irrevocably authorize the Agent, at its option and in its discretion, to release
any Lien upon any Collateral (a) as authorized by this Agreement or any of the
other Credit Documents, (b) upon the termination of the Commitments and payment
or satisfaction of all of the Obligations, or (c) constituting Equipment sold or
disposed of in accordance with the terms of this Agreement if the Borrowers and
Guarantors certify to the
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Agent that the disposition is made in compliance with the terms of this
Agreement (and the Agent may rely conclusively on any such certificate, without
further inquiry). Except as expressly authorized or required by this Agreement
or applicable law, the Agent shall not execute any release or termination of any
Lien upon any of the Collateral without the prior written authorization of all
Lenders. The Agent shall have no obligation whatsoever to any of the Lenders to
assure that any of the Collateral exists or is owned by any Borrower or any
Guarantor or is cared for, protected or insured or has been encumbered, or that
the Agent's Liens have been properly or sufficiently or lawfully created,
perfected, protected or enforced or entitled to any particular priority or to
exercise at all or in any manner or under any duty of care, disclosure or
fidelity, or to continue exercising, any of the rights or powers granted or
available to the Agent pursuant to this Agreement or any of the other Credit
Documents, it being understood and agreed among the Lenders that in respect of
the Collateral, or any act, omission or event related thereto, the Agent may act
in any manner it may deem appropriate, in its discretion, given the Agent's own
interests in the Collateral in its capacity as one of the Lenders.
SECTION 7.12. Agent Field Examinations; Appraisals. The Agent
shall promptly, upon receipt thereof, forward to each Lender copies of the
results of any field examinations by the Agent with respect to the Borrowers or
the Guarantors and any appraisals obtained by the Agent with respect to any of
the Collateral. The Agent shall have no liability to any Lender for any errors
in or omissions from any field examination or other examination of the Borrowers
or the Guarantors or the Collateral, or in any such appraisal, unless such error
or omission was the direct result of the Agent's willful misconduct or gross
negligence.
SECTION 7.13. Designation of Co-Agent. It is the purpose of
this Agreement that there shall be no violation of any applicable law denying or
restricting the right of financial institutions to transact business as an agent
in any jurisdiction. It is recognized that, in case of litigation under any of
the Credit Documents, or in case the Agent deems that by reason of present or
future laws of any jurisdiction the Agent might be prohibited from exercising
any of the powers, rights or remedies granted to the Agent or the Lenders
hereunder or under any of the Credit Documents or from holding title to or a
Lien upon any Collateral as provided hereunder or thereunder or from taking any
other action which may be necessary hereunder or under any of the Credit
Documents, the Agent may appoint an additional Person or Persons as a separate
collateral agent or co-collateral agent which is not so prohibited from taking
any of such actions or exercising any of such powers, rights or remedies. If the
Agent shall appoint an additional Person as a separate collateral agent or
co-collateral agent as provided above, each and every remedy, power, right,
claim, demand or cause of action intended by this Agreement and any of the
Credit Documents and every remedy, power, right, claim, demand or cause of
action intended by this Agreement and any of the Credit Documents to be
exercised by or vested in or conveyed to the Agent with respect thereto shall be
exercisable by and vested in such separate collateral agent or co-collateral
agent, but only to the extent necessary to enable such separate collateral agent
or co-collateral agent to exercise such powers, rights and remedies, and every
covenant and obligation necessary to the exercise thereof by such separate
collateral agent or co-collateral agent shall run to and be enforceable by any
of them. Should any instrument from the Lenders be required by the separate
collateral agent or co-collateral agent so appointed by the Agent in order more
fully and certainly to vest in and confirm to him or it such rights, powers,
duties and obligations, any and all of such instruments shall, on request, be
executed, acknowledged and delivered by the Lenders whether or not a Default or
Event of Default then exists. In case any
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separate collateral agent or co-collateral agent, or a successor to either,
shall die, become incapable of acting, resign or be removed, all the estates,
properties, rights, power, duties and obligations of such separate collateral
agent or co-collateral agent, so far as permitted by applicable law, shall vest
in and be exercised by the Agent until the appointment of a new collateral agent
or successor to such separate collateral agent or co-collateral agent.
SECTION 7.14. Replacement of Certain Lenders. If a Lender
("Affected Lender") shall have (a) failed to fund its Commitment Percentage of
any Loan requested by the Borrowers which such Lender is obligated to fund under
the terms of this Agreement and which such failure has not been cured, (b)
requested compensation from the Borrowers under SECTION 8.03 to recover
increased costs or reduced returns incurred by such Lender (or its Lending
Office, parent or holding company) which are not being incurred generally by the
other Lenders (or their respective Lending Office, parent or holding company),
or (c) delivered (or its respective parents or holding companies shall have
delivered) a notice pursuant to ARTICLE 8 claiming that such Lender (or its
Lending Office or affiliate) is unable to extend Euro-Dollar Loans to the
Borrowers for reasons not generally applicable to the other Lenders, then, in
any such case and in addition to any other rights and remedies that the Agent,
any other Lender or the Borrowers may have against such Affected Lender, the
Borrowers or the Agent may make written demand on such Affected Lender (with a
copy to the Agent in the case of a demand by the Borrowers and a copy to the
Borrowers in the case of a demand by the Agent) for the Affected Lender to
assign, and such Affected Lender shall assign pursuant to one or more duly
executed Assignment and Acceptances within 5 Business Days after the date of
such demand, to one or more Lenders willing to accept such assignment or
assignments, or to one or more assignees approved by the Agent (such approval
not to be unreasonably withheld), all of such Affected Lender's rights and
obligations under this Agreement (including its Commitments and all Obligations
owing to it) in accordance with SECTION 10.08; provided, however, the Agent
shall have no duty to locate an assignee for the purposes of accepting such
assignment. The Agent is hereby irrevocably authorized to execute one or more
Assignment and Acceptances as attorney-in-fact for any Affected Lender which
fails or refuses to execute and deliver the same within 5 Business Days after
the date of such demand. The Affected Lender shall be entitled to receive from
the assignee, in case and concurrently with execution and delivery of each such
Assignment and Acceptance, all amounts owed to the Affected Lender hereunder or
under any other Credit Document, including the aggregate outstanding principal
amount of the Obligations owed to such Lender, together with accrued interest
thereon through the date of such assignment. Upon the replacement of any
Affected Lender pursuant to this SECTION 7.14, such Affected Lender shall cease
to have any participation in, entitlement to, or other right to share in the
Liens of the Agent in any Collateral and such Affected Lender shall have no
further liability to the Agent, any Lender or any other Person under any of the
Credit Documents (except with respect to events or transactions which occur
prior to the replacement of such Affected Lender), including any commitment to
make Loans or purchase any participations in the Letters of Credit.
ARTICLE 8
CHANGE IN CIRCUMSTANCES; COMPENSATION
SECTION 8.01. Basis for Determining Interest Rate Inadequate
or Unfair. If on or prior to the first day of any Interest Period:
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(a) the Agent determines that deposits in Dollars (in the
applicable amounts) are not being offered in the relevant market for such
Interest Period, or
(b) the Required Lenders advise the Agent that the London
Interbank Offered Rate, as determined by the Agent will not adequately and
fairly reflect the cost to such Lenders of funding the relevant type of
Euro-Dollar Loans for such Interest Period,
the Agent shall forthwith give notice thereof to the Borrowers
and the Lenders, whereupon until the Agent notifies the Borrowers that the
circumstances giving rise to such suspension no longer exist, the obligations of
the Lenders to make the type of Euro-Dollar Loans specified in such notice, or
to permit continuations or conversions into such type of Euro-Dollar Loans,
shall be suspended. Unless the Borrowers notify the Agent at least 2 Domestic
Business Days before the date of any Borrowing of such type of Euro-Dollar Loans
for which a Notice of Borrowing has previously been given, or continuation or
conversion into such type of Euro-Dollar Loans for which a Notice of
Continuation or Conversion has previously been given, that it elects not to
borrow or so continue or convert on such date, such Borrowing shall instead be
made as a Base Rate Borrowing, or such Euro-Dollar Loan shall be converted to a
Base Rate Loan.
SECTION 8.02. Illegality. If, after the date hereof, the
adoption of any applicable law, rule or regulation, or any change therein, or
any change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof (any such agency being referred to as an "Authority" and
any such event being referred to as a "Change of Law"), or compliance by any
Lender (or its Lending Office) with any request or directive (whether or not
having the force of law) of any Authority issued after the date hereof shall
make it unlawful or impossible for any Lender (or its Lending Office) to make,
maintain or fund its Euro-Dollar Loans or issue Letters of Credit and such
Lender shall so notify the Agent, the Agent shall forthwith give notice thereof
to the other Lenders and the Borrowers, whereupon until such Lender notifies the
Borrowers and the Agent that the circumstances giving rise to such suspension no
longer exist, the obligation of such Lender to make Euro-Dollar Loans or issue
Letters of Credit shall be suspended. Before giving any notice to the Agent
pursuant to this SECTION 8.02, such Lender shall designate a different Lending
Office if such designation will avoid the need for giving such notice and will
not, in the judgment of such Lender, be otherwise disadvantageous to such
Lender. If such Lender shall determine that it may not lawfully continue to
maintain and fund any of its outstanding Euro-Dollar Loans to maturity or issue
Letters of Credit, and shall so specify in such notice, the Borrowers shall
immediately prepay in full the then outstanding principal amount of each
affected Euro-Dollar Loan of such Lender, together with accrued interest thereon
and any amount due such Lender pursuant to SECTION 8.05(a). Concurrently with
prepaying each such Euro-Dollar Loan the Borrowers may borrow a Base Rate Loan
in an equal principal amount from such Lender (on which interest and principal
shall be payable contemporaneously with the related Euro-Dollar Loans of the
other Lenders), and if so requested by the Borrowers such Lender shall make such
a Base Rate Loan.
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SECTION 8.03. Increased Cost and Reduced Return.
(a) If after the date hereof, a Change of Law or
compliance by any Lender (or its Lending Office) with any request or directive
(whether or not having the force of law) of any Authority issued after the date
hereof:
(i) shall impose, modify or deem applicable any
reserve, special deposit or similar requirement (including,
without limitation, any such requirement imposed by the Board
of Governors of the Federal Reserve System, but excluding with
respect to any Euro-Dollar Loan any such requirement included
in an applicable Euro-Dollar Reserve Percentage) against
assets of, deposits with or for the account of, or credit or
letter of credit extended by, any Lender (or its Lending
Office); or
(ii) shall impose on any Lender (or its Lending
Office) or on the United States market for certificates of
deposit or the London interbank market any other condition
affecting its Euro-Dollar Loans, Letters of Credit, its Notes
or its obligation to make Euro-Dollar Loans;
and the result of any of the foregoing is to increase the cost
to such Lender (or its Lending Office) of making or maintaining any Euro-Dollar
Loan or Letter of Credit, or to reduce the amount of any sum received or
receivable by such Lender (or its Lending Office) under this Agreement or under
its Notes with respect thereto (other than resulting from income taxes), by an
amount reasonably deemed by such Lender to be material, then, within 30 days
after demand by such Lender (with a copy to the Agent), the Borrowers shall pay
to such Lender such additional amount or amounts as will compensate such Lender
for such increased cost or reduction.
(b) If any Lender shall have determined in good faith
that after the date hereof the adoption of any applicable law, rule or
regulation regarding capital adequacy, or any change therein, or any change in
the interpretation or administration thereof by any Authority, or compliance by
any Lender (or its Lending Office) with any request or directive regarding
capital adequacy (whether or not having the force of law) of any Authority
issued after the date hereof, has or would have the effect of reducing the rate
of return on such Lender's capital as a consequence of its obligations (whether
with respect to Loans or the Letters of Credit) hereunder to a level below that
which such Lender could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's policies with respect to
capital adequacy) by an amount reasonably deemed by such Lender to be material,
then from time to time, within 30 days after demand by such Lender, the
Borrowers shall pay to such Lender such additional amount or amounts as will
compensate such Lender for such reduction.
(c) Each Lender will promptly notify the Borrowers and
the Agent of any event of which it has knowledge, occurring after the date
hereof, which will entitle such Lender to compensation pursuant to this SECTION
8.03 and will designate a different Lending Office if such designation will
avoid the need for, or reduce the amount of, such compensation and will not, in
the judgment of such Lender, be otherwise disadvantageous to such Lender. No
Lender shall claim compensation under this SECTION 8.03 for any period of time
before 120 days prior
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to the delivery of such notice (unless such notice relates to a matter having
retroactive effect in which case such 120 days shall be extended by such period
of retroactivity).
(d) A certificate of any Lender claiming compensation
under this SECTION 8.03 and setting forth the additional amount or amounts to be
paid to it hereunder shall be rebuttable presumptive evidence thereof if
rendered in good faith. In determining such amount, such Lender may use any
reasonable averaging and attribution methods.
(e) The provisions of this SECTION 8.03 shall be
applicable with respect to any Participant, Assignee or other Transferee, and
any calculations required by such provisions shall be made based upon the
circumstances of such Participant, Assignee or other Transferee.
SECTION 8.04. Base Rate Loans or Other Euro-Dollar Loans
Substituted for Euro-Dollar Loans. If (a) the obligation of any Lender to make
or maintain Euro-Dollar Loans has been suspended pursuant to SECTION 8.02 or (b)
any Lender has demanded compensation under SECTION 8.03, and the Borrowers
shall, by at least 5 Euro-Dollar Business Days' prior notice to such Lender
through the Agent, have elected that the provisions of this SECTION 8.04 shall
apply to such Lender, then, unless and until such Lender notifies the Borrowers
that the circumstances giving rise to such suspension or demand for compensation
no longer apply:
(a) all Loans which would otherwise be made by such
Lender as, or permitted to be continued as or converted into, Euro-Dollar Loans
shall be made instead as or converted into Base Rate Loans (in all cases
interest and principal on such Loans shall be payable contemporaneously with the
related Euro-Dollar Loans of the other Lenders), and
(b) after each of its Euro-Dollar Loans has been repaid,
all payments of principal which would otherwise be applied to repay such
Euro-Dollar Loans shall be applied to repay its Base Rate Loans instead.
SECTION 8.05. Compensation. Upon the request of any Lender,
delivered to the Borrowers and the Agent, the Borrowers shall pay to such Lender
such amount or amounts as shall compensate such Lender for any loss, cost or
expense incurred by such Lender as a result of:
(a) any payment or prepayment (pursuant to SECTION 2.10,
2.11, 6.01, 8.02 or otherwise) of a Euro-Dollar Loan on a date other than the
last day of an Interest Period for such Loan; or
(b) with respect to prepayment of a Euro-Dollar Loan on
any day other than the last day of the Interest Period with respect thereto, any
failure by the Borrowers to prepay such Euro-Dollar Loan on the date for such
prepayment specified in the relevant notice of prepayment; or
(c) any failure by the Borrowers to borrow a Euro-Dollar
Loan on the date for the Euro-Dollar Borrowing of which such Euro-Dollar Loan is
a part specified in the applicable Notice of Borrowing delivered pursuant to
SECTION 2.02;
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such compensation to consist of an amount equal to the excess, if any, of (x)
the amount of interest which would have accrued on the amount so paid or prepaid
or not prepaid or borrowed for the period from the date of such payment,
prepayment or failure to prepay or borrow to the last day of the then current
Interest Period for such Euro-Dollar Loan (or, in the case of a failure to
prepay or borrow, the Interest Period for such Euro-Dollar Loan which would have
commenced on the date of such failure to prepay or borrow) at the applicable
rate of interest for such Euro-Dollar Loan provided for herein over (y) the
amount of interest (as reasonably determined by such Lender) such Lender would
have paid on deposits in Dollars of comparable amounts having terms comparable
to such period placed with it by leading banks in the London interbank market.
No Lender shall claim compensation under this SECTION 8.05 for any period of
time before 120 days prior to the delivery of such notice.
SECTION 8.06. Failure to Pay in Foreign Currency.
If any Borrower is unable for any reason to effect payment in
a foreign currency as required to repay a draw under an Existing Letter of
Credit or a call under any of the Special Foreign Guarantees or if any Borrower
shall default in the foreign currency, Wachovia may require such payment to be
made in Dollars in the Dollar Equivalent amount of such payment. In any case in
which any Borrower shall make such payment in Dollars, such Borrower agrees to
hold Wachovia harmless from any loss incurred by Wachovia arising from any
change in the value of Dollars in relation to such foreign currency between the
date such payment became due and the date of payment thereof.
SECTION 8.07. Judgment Currency.
If for the purpose of obtaining judgment in any court or
enforcing any such judgment it is necessary to convert any amount due in any
foreign currency into any other currency, the rate of exchange used shall be the
Agent's spot rate of exchange for the purchase of the foreign currency with such
other currency at the close of business on the Business Day preceding the date
on which judgment is given or any order for payment is made. The obligation of
the relevant Borrower in respect of any amount due from it hereunder in a
foreign currency shall, notwithstanding any judgment or order for a liquidated
sum or sums in a currency other than the relevant foreign currency in respect of
amounts due hereunder (but with due regard to such judgment or order apart from
the currency exchange issue addressed in this paragraph), be discharged only to
the extent that the relevant Borrower pays the amount due in the relevant
foreign currency or, on the Business Day following receipt by the Agent of any
payment in a currency other than the relevant foreign currency, the Agent is
able (in accordance with normal lending procedures) to purchase the relevant
foreign currency with such other currency. If the amount of the relevant foreign
currency that the Agent is able to purchase with such other currency is less
than the amount due in the relevant foreign currency, such Borrower shall
indemnify the Lenders for the shortfall.
ARTICLE 9
CONDITIONS TO BORROWINGS AND ISSUANCE OF LETTERS OF CREDIT
SECTION 9.01. Conditions to Initial Borrowing and issuance of
any Letter of Credit. The obligation of each Lender to make a Loan or the LC
Issuer to issue a Letter of Credit
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on the occasion of the earlier of (i) the initial Borrowing or (ii) the initial
issuance of a Letter of Credit is subject to the satisfaction of the conditions
set forth in SECTION 9.02 and receipt by the Agent of the following (as to the
documents described in paragraphs (a), (c), (d) and (e) below, in sufficient
number of counterparts for delivery of a counterpart to each Lender and
retention of one counterpart by the Agent):
(a) from each of the parties hereto of either (i) a duly
executed counterpart of this Agreement signed by such party or (ii) a facsimile
transmission of such executed counterpart, with the original to be sent to the
Agent by overnight courier;
(b) a duly executed Revolving Loan Note for the account
of each Lender, and a duly executed Settlement Loan Note for Wachovia for the
account of each Lender, in each case complying with the provisions of SECTION
2.04;
(c) an opinion letter from each of Xxxxx Xxxxxxxxxx,
General Counsel, and Xxxxx Xxxx LLP, special counsel for the Borrowers and the
Guarantors, dated as of the Closing Date, substantially in the form of EXHIBIT
B-1 and EXHIBIT B-2, respectively, and covering such additional matters relating
to the transactions contemplated hereby as the Agent or any Lender may
reasonably request;
(d) an opinion of Xxxxx Day, special counsel for the
Agent, dated as of the Closing Date, substantially in the form of EXHIBIT C and
covering such additional matters relating to the transactions contemplated
hereby as the Agent may reasonably request;
(e) a certificate (the "Closing Certificate")
substantially in the form of EXHIBIT H, dated as of the Closing Date, signed by
a principal financial officer of the Borrowers and the Guarantors, to the effect
that (i) no Default has occurred and is continuing on the date of the first
Borrowing under this Agreement, and (ii) the representations and warranties of
the Borrowers and the Guarantors contained in ARTICLE 4 are true in all material
respects on and as of the date of the first Borrowing or first Letter of Credit
issuance hereunder;
(f) all documents which the Agent or any Lender may
reasonably request relating to the existence of each of the Borrowers and the
Initial Subsidiary Guarantors, the corporate authority for and the validity of
this Agreement, the Notes and the other Credit Documents to which it is a party
and any other matters relevant hereto, all in form and substance reasonably
satisfactory to the Agent, including, without limitation, an Officer's
Certificate of each of the Borrowers and the Initial Subsidiary Guarantors,
signed by the Secretary or an Assistant Secretary of such Borrower or Initial
Subsidiary Guarantor, certifying as to the names, true signatures and incumbency
of the officer or officers of such Borrower or Initial Subsidiary Guarantor
authorized to execute and deliver the Credit Documents to which it is a party,
and certified copies of the following items: (i) such Borrower's or Initial
Subsidiary Guarantor's Certificate of Incorporation, (ii) such Borrower's or
Initial Subsidiary Guarantor's Bylaws, (iii) a certificate of good standing or
valid existence of the Secretary of State of the State of the jurisdiction of
its incorporation and of each State in which it is qualified to do business as a
foreign corporation, and (iv) the action taken by the Board of Directors of each
of the Borrowers and Initial Subsidiary Guarantors authorizing such Borrower's
or Initial Subsidiary Guarantor's
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execution, delivery and performance of this Agreement, the Notes and the other
Credit Documents to which such Borrower or Initial Subsidiary Guarantor is a
party;
(g) an initial Borrowing Base Certificate showing, after
giving effect to any Revolving Loan Borrowings on the Closing Date or issuance
of Letters of Credit and the payment of all fees and expenses in connection with
this Credit Agreement that have been billed or are due and payable on the
Closing Date, and after deducting for any past due trade payables, that the
Excess Borrowing Availability is at least $50,000,000 in excess of the Working
Capital Obligations;
(h) two counterparts, duly executed by each of the
Initial Subsidiary Guarantors, of each of the Contribution Agreement, the Pledge
Agreement, each Waiver Agreement requested by the Agent, the Guaranty and the
Collateral Disclosure Certificates;
(i) UCC-1 financing statements (satisfactory in form and
content to the Agent in all respects) pertaining to the Collateral shall have
been filed or are ready for filing in all filing offices reasonably deemed
necessary by the Agent;
(j) receipt of field examinations pertaining to the
Borrowers' and the Guarantors' Accounts and Inventory reasonably acceptable to
the Agent;
(k) the reasonable satisfaction of the Agent with the
level and condition of accounts payable of the Borrower;
(l) receipt of all consents and approvals of
shareholders, governmental entities and other third parties as are necessary in
connection with this transaction;
(m) receipt of projections reasonably satisfactory to the
Agent and the Arranger for the Parent and its Subsidiaries (i) prepared on a
quarterly basis for Fiscal Year 2003 and (ii) prepared on an annual basis for
Fiscal Years 2004, 2005 and 2006;
(n) receipt of lien searches reasonably acceptable to the
Agent, showing no Liens other than Permitted Encumbrances;
(o) since December 31, 2002, except as disclosed in
Schedule 4.04, no Material Adverse Effect shall have occurred and be continuing;
(p) evidence of insurance as required by this Agreement;
(q) delivery to the Agent of an Instruction Letter in
substantially the form of EXHIBIT K;
(r) payment of all fees owed to the Agents and the
Lenders hereunder;
(s) a Notice of Borrowing for any Borrowing on the
Closing Date; and
(t) establishment of the lockboxes and the Collateral
Reserve Accounts and execution of the Deposit Account Control Agreements, as
required by SECTION 2.15(a).
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In addition, if the Borrowers desire funding of a Euro-Dollar
Loan on the Closing Date, the Agent shall have received, the requisite number of
days prior to the Closing Date, a funding indemnification letter satisfactory to
it, pursuant to which (A) the Agent and the Borrowers shall have agreed upon the
interest rate, amount of Borrowing and Interest Period for such Euro-Dollar
Loan, and (B) the Borrowers shall indemnify the Lenders from any loss or expense
arising from the failure to close on the anticipated Closing Date identified in
such letter or the failure to borrow such Euro-Dollar Loan on such date (other
than any such failure caused by a failure by the Lenders to fund such
Euro-Dollar Loan in violation of this Agreement).
SECTION 9.02. Conditions to All Borrowings and Issuances of
Letters of Credit. The obligation of each Lender to make a Loan, or the LC
Issuer to issue a Letter of Credit, on the occasion of each Borrowing or
issuance of a Letter of Credit is subject to the satisfaction of the following
conditions:
(a) (i) except for Refunding Loans, the fact that,
immediately before and after such Borrowing or issuance of a Letter of Credit,
no Default shall have occurred and be continuing, and (ii) the fact that the
Borrowers have certified to Agent that Borrowers have not caused and such
Borrowing or issuance of a Letter of Credit will not cause: (A) any "Lien" (as
defined in the Senior Note Purchase Agreements) to exist which is not permitted
under Section 10.2 of the 1997 Note Purchase Agreement and Section 10.3 of the
1999 Note Purchase Agreement; (B) "Priority Debt" outstanding to exceed 20% of
"Consolidated Total Capitalization" (as such terms are defined in the Senior
Note Purchase Agreements); and (C) "Indebtedness" (as defined in the Senior Note
Purchase Agreements) to be incurred and be outstanding in an amount which would
cause "Consolidated Indebtedness" to exceed 65% of "Consolidated Total
Capitalization" (as such terms are defined in the Senior Note Purchase
Agreements);
(b) the fact that the representations and warranties of
the Borrowers and the Guarantors contained in ARTICLE 4 shall be true on and as
of the date of such Borrowing or issuance of a Letter of Credit (except to the
extent any such representation or warranty is expressly made as of a prior
date); and
(c) the fact that, immediately after such Borrowing or
issuance of a Letter of Credit, the conditions set forth in clauses (i) and (ii)
of SECTION 2.01(a) shall have been satisfied.
Each Syndicated Borrowing, each Settlement Loan Borrowing,
each Notice of Continuation or Conversion and each issuance of a Letter of
Credit hereunder shall be deemed to be a representation and warranty by the
Borrowers and the Guarantors on the date of such Borrowing or issuance of a
Letter of Credit as to the truth and accuracy of the facts specified in
paragraphs (a), (b) and (c) of this SECTION 9.02; provided, that (i) if such
Syndicated Borrowing is a Euro-Dollar Borrowing which consists solely of a
Refunding Loan or such Notice of Continuation or Conversion is to a Euro-Dollar
Rate Loan, such Syndicated Borrowing or Notice of Continuation or Conversion
shall be deemed to be such a representation and warranty by the Borrowers and
the Guarantors only as to the matters set forth in paragraphs (a) and (c) above,
and (ii) if such Syndicated Borrowing is a Base Rate Borrowing which consists
solely of a Refunding Loan or such Notice of Continuation or Conversion is to a
Base Rate Loan, such
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Syndicated Borrowing or Notice of Continuation or Conversion shall be deemed to
be a representation and warranty by the Borrowers and the Guarantors only as to
the matters set forth in paragraphs (a)(ii) and (c) above.
ARTICLE 10
MISCELLANEOUS
SECTION 10.01. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including telecopier
or similar writing) and shall be given to such party at its address or
telecopier number set forth on the signature pages hereof or such other address
or telecopier number as such party may hereafter specify for the purpose by
notice to each other party. Each such notice, request or other communication
shall be effective (a) if given by telecopier, when such telecopy is transmitted
to the telecopier number specified in this SECTION 10.01 and the confirmation is
received, (b) if given by mail, 72 hours after such communication is deposited
in the mail with first class postage prepaid, addressed as aforesaid or (c) if
given by any other means, when delivered at the address specified in this
SECTION; provided that notices to the Agent under ARTICLE 2 or ARTICLE 8 shall
not be effective until received.
SECTION 10.02. No Waivers. The failure of a Borrower to
satisfy, or the waiver by the Agent and the Lenders of, any condition set forth
in SECTION 9.02 shall not constitute a waiver of any such condition with respect
to any subsequent advance of a Loan, unless such waiver is expressly agreed to
in writing as required by SECTION 10.06. No failure or delay by the Agent or any
Lender in exercising any right, power or privilege hereunder or under any Note
or other Credit Document shall operate as a waiver thereof nor shall any single
or partial exercise thereof preclude any other or further exercise thereof or
the exercise of any other right, power or privilege. The rights and remedies
herein provided shall be cumulative and not exclusive of any rights or remedies
provided by law.
SECTION 10.03. Expenses; Documentary Taxes. The Borrowers and
the Guarantors (by execution and delivery of the Guaranty) shall pay (a) all
reasonable out-of-pocket expenses (including, without limitation, all reasonable
attorney and paralegal fees and expenses of the Agent, recording costs, and
recording or intangible taxes, if any) of the Agent incurred in connection with
this Agreement and the other Credit Documents, including, without limitation (in
any event only to the extent relating to this Agreement or the other Credit
Documents and only to the extent reasonable), (i) all costs, fees and taxes
pertaining to the obtaining, preparation or filing of all equipment and
inventory appraisals, audit reports, field examinations, lien searches, UCC-1
financing statements (including, without limitation, any release thereof), (ii)
all fees and disbursements of special counsel for the Lenders and the Agent,
(iii) all costs and fees incurred in connection with the preparation,
negotiation, administration and execution and delivery of this Agreement and the
other Credit Documents, and any waiver or consent hereunder or thereunder or any
amendment hereof or thereof or any Default or alleged Default hereunder or
thereunder, (iv) sums paid or incurred to pay for any amount or to take any
action required of the Borrowers or the Guarantors under this Agreement that any
Borrower fails to pay or take after any grace period applicable thereto; (v)
costs and expenses of preserving and protecting the Collateral; and (b) during
the existence of an Event of Default, costs and expenses (including reasonable
attorney and paralegal fees and expenses and reasonable costs and
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expenses of financial consultants) paid or incurred to obtain payment of the
Obligations, enforce the Lien in the Collateral, preserve and protect the
Collateral, sell or otherwise realize upon the Collateral, and otherwise enforce
the provisions hereof or of any Credit Document or to defend any claim made or
threatened against the Agent or any of the Lenders arising out of the
transactions contemplated hereby (including, without limitation, preparations
for and consultations concerning any such matters). The foregoing shall not be
construed to limit any other provisions hereof, or of any Credit Document
regarding costs and expenses to be paid by the Borrowers and the Guarantors. In
the event any Borrower or any Guarantor becomes a debtor under the Bankruptcy
Code, the Agent's and each Lender's secured claim in such case shall include
interest on the Obligations and all fees, costs and charges provided for herein
(including, without limitation, reasonable attorneys' fees actually incurred),
all to the extent allowed by the Bankruptcy Code. The Borrowers and the
Guarantors (by execution and delivery of the Guaranty) shall indemnify the Agent
and each Lender against any transfer taxes, documentary taxes, assessments or
charges made by any Authority by reason of the execution and delivery of this
Agreement or the other Credit Documents.
SECTION 10.04. Indemnification. The Borrowers and the
Guarantors (by execution and delivery of the Guaranty) shall indemnify the
Agent, the Lenders and each Affiliate thereof and their respective directors,
officers, employees and agents from, and hold each of them harmless against, any
and all losses, liabilities, claims or damages to which any of them may become
subject, insofar as such losses, liabilities, claims or damages arise out of or
result from any actual or proposed use by the Borrowers of the proceeds of any
extension of credit by any Lender hereunder or breach by the Borrowers of this
Agreement or any other Credit Document or from any investigation, litigation
(including, without limitation, any actions taken by the Agent or any of the
Lenders to enforce this Agreement or any of the other Credit Documents) or other
proceeding (including, without limitation, any threatened investigation or
proceeding) relating to the foregoing, and the Borrowers and the Guarantors
shall reimburse the Agent and each Lender, and each Affiliate thereof and their
respective directors, officers, employees and agents, upon demand for any
reasonable out-of-pocket expenses (including, without limitation, legal fees)
incurred in connection with any such investigation or proceeding; but excluding
any such losses, liabilities, claims, damages or expenses incurred by reason of
the gross negligence or willful misconduct of the Person (or agent thereof) to
be indemnified.
SECTION 10.05. Setoff; Sharing of Setoffs.
(a) Each of the Borrowers and each of the Guarantors
hereby grants to the Agent and each Lender, and to Wachovia as to the Settlement
Loans, the ForEx Obligations and the LC Issuer as to the Letter of Credit
Obligations, a lien to secure all Obligations owing to them from the Borrowers
or the Guarantors upon all deposits or deposit accounts, of any kind, or any
interest in any deposits or deposit accounts thereof, now or hereafter pledged,
mortgaged, transferred or assigned to the Agent or any such Lender or otherwise
in the possession or control of the Agent or any such Lender for any purpose for
the account or benefit of the Borrowers or the Guarantors and including any
balance of any deposit account or of any credit of the Borrowers or the
Guarantors with the Agent or any such Lender, whether now existing or hereafter
established hereby authorizing the Agent and each Lender at any time or times
that an Event of Default has occurred and is continuing, with or without prior
notice, to apply such balances or any part thereof to such of the Obligations
owing by the Borrowers or the Guarantors
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to the Lenders, Wachovia, the LC Issuer and/or the Agent then past due and in
such amounts as they may elect, and whether or not the Collateral or other
collateral, if any, or the responsibility of other Persons primarily,
secondarily or otherwise liable may be deemed adequate. The Agent appoints,
authorizes and directs each Lender to act as a collateral sub-agent for the
Agent and the Lenders with respect to any property of each Borrower or each
Guarantor left with such Lender or in the possession, custody or control now or
hereafter of such Lender, all Deposit Accounts of each Borrower or each
Guarantor now or hereafter opened with such Lender, all certificates of deposit
issued by such Lender to any Borrower or any Guarantor, and all Instruments,
drafts, checks and other items deposited in or with such Lender by any Borrower
or any Guarantor for collection now or hereafter. For the purposes of this
paragraph, all remittances and property shall be deemed to be in the possession
of the Agent, Wachovia, the LC Issuer or any such Lender as soon as the same may
be put in transit to it by mail or carrier or by other bailee.
(b) Each Lender and the LC Issuer agrees that if it
shall, by exercising any right of setoff (with the consent or direction of the
Required Lenders) or counterclaim or resort to collateral security or otherwise,
receive payment of a proportion of the aggregate amount of the principal and
interest owing with respect to the Loans held by it, or the Letter of Credit
Obligations which is greater than the proportion received by any other Lender in
respect of the aggregate amount of all principal and interest owing with respect
to the Loans held by such other Lender or the LC Issuer with respect to the
Letter of Credit Obligations, the Lender or the LC Issuer receiving such
proportionately greater payment shall purchase such participations in the Loans
held by the other Lenders owing to such other Lenders and the Letter of Credit
Obligations, and such other adjustments shall be made, as may be required so
that all such payments of principal and interest with respect to the Loans held
by the Lenders owing to such other Lenders or the LC Issuer and the Letter of
Credit Obligations shall be shared by the Lenders and the LC Issuer in
accordance with their Commitment Percentage; provided that (i) nothing in this
SECTION 10.05 shall impair the right of any Lender to exercise any right of
setoff or counterclaim it may otherwise have and to apply the amount subject to
such exercise to the payment of indebtedness of the Borrowers other than their
indebtedness under the Loans or the Letter of Credit Obligations, and (ii) if
all or any portion of such payment received by the purchasing Lender is
thereafter recovered from such purchasing Lender, such purchase from each other
Lender or the LC Issuer shall be rescinded and such other Lender or the LC
Issuer shall repay to the purchasing Lender or the LC Issuer the purchase price
of such participation to the extent of such recovery together with an amount
equal to such other Lender's or the LC Issuer's ratable share (according to the
proportion of (A) the amount of such other Lender's or the LC Issuer's required
repayment to (B) the total amount so recovered from the purchasing Lender or the
LC Issuer) of any interest or other amount paid or payable by the purchasing
Lender or the LC Issuer in respect of the total amount so recovered. Each of the
Borrowers and the Guarantors agrees, to the fullest extent it may effectively do
so under applicable law, that any holder of a participation in a Loan, or risk
participant with respect to the Letter of Credit Obligations, whether or not
acquired pursuant to the foregoing arrangements, may exercise rights of setoff
or counterclaim and other rights with respect to such participation as fully as
if such holder of a participation were a direct creditor of the Borrowers or the
Guarantors in the amount of such participation.
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SECTION 10.06. Amendments and Waivers.
(a) Any provision of this Agreement, the Notes or any
other Credit Documents may be amended or waived if, but only if, such amendment
or waiver is in writing and is signed by the Borrowers (and the Guarantors, to
the extent party to the applicable Credit Documents) and the Required Lenders
(and, if the rights or duties of the Agent are affected thereby, by the Agent);
provided that, no such amendment or waiver shall: (1) unless signed by all
Lenders directly affected thereby, (i) change the Commitment of such Lender or
subject such Lender to any additional obligation, (ii) reduce the principal of
or rate of interest on any Loan or any fees (other than fees payable to the
Agent) hereunder, (iii) change the date fixed for any payment of principal of or
interest on any Loan or any fees hereunder, or (iv) reduce the amount of
principal, interest or fees due on any date fixed for the payment thereof; and
(2) unless signed by all Lenders, (i) increase the aggregate amount of the
Commitments, (ii) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Notes, or the percentage of Lenders, which shall
be required for the Lenders or any of them to take any action under this SECTION
10.06 or any other provision of this Agreement, (iii) change the manner of
application of any payments made under this Agreement or the Notes, or the
provisions with respect to pro rata treatment among Lenders (including, without
limitation, as to sharing of payments and expenses), (iv) except as expressly
provided in this Agreement or any of the other Credit Documents, release of all
or any substantial part of the Collateral held as security for the Loans, (v)
release any Guaranty or any other Guarantee given to support payment of the
Loans, (vi) change the definitions of "Borrowing Base," "Eligible Accounts,"
"Eligible Inventory," or "Required Lenders", (vii) change the provisions of any
of ARTICLE 7 or SECTIONS 10.04 or 10.20, (viii) increase the limit on
Overadvance Loans as provided in Section 2.01(c), or (ix) change the joint and
several nature of the obligations of the Borrowers, or the several nature of the
obligations of the Lenders under their respective Commitments; and provided
further that, no provision of this Agreement relating to Settlement Loans, ForEx
Obligations and Letter of Credit Obligations may be amended without the prior
written consent of the LC Issuer or Wachovia, as applicable.
(b) The Borrowers will not solicit, request or negotiate
for or with respect to any proposed waiver or amendment of any of the provisions
of this Agreement except through the Agent, or unless each Lender shall be
informed thereof by the Borrowers and shall be afforded an opportunity of
considering the same and shall be supplied by the Borrowers with sufficient
information to enable it to make an informed decision with respect thereto.
Executed or true and correct copies of any waiver or consent effected pursuant
to the provisions of this Agreement shall be delivered by the Borrowers to the
Agent (for distribution to each Lender) forthwith following the date on which
the same shall have been executed and delivered by the requisite percentage of
Lenders. The Borrowers will not, directly or indirectly, pay or cause to be paid
any remuneration, whether by way of supplemental or additional interest, fee or
otherwise, to any Lender (in its capacity as such) as consideration for or as an
inducement to the entering into by such Lender of any waiver or amendment of any
of the terms and provisions of this Agreement unless such remuneration is
concurrently paid, on the same terms, ratably to all such Lenders.
SECTION 10.07. No Margin Stock Collateral. Each of the Lenders
represents to the Agent and each of the other Lenders that it in good faith is
not, directly or indirectly (by
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negative pledge or otherwise), relying upon any Margin Stock as collateral in
the extension or maintenance of the credit provided for in this Agreement.
SECTION 10.08. Successors and Assigns.
(a) The provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns; provided that the Borrowers may not assign or otherwise
transfer any of its rights under this Agreement.
(b) Any Lender may at any time sell to one or more
Persons (each a "Participant") participating interests in any Loan owing to such
Lender, any Note held by such Lender, any Commitment of such Lender hereunder or
any other interest of such Lender hereunder; provided, however, that if a Lender
is selling a participation in only a portion of its Commitment or any other
interest of such Lender hereunder, the participation being sold (determined as
of the effective date of the sale of the participation) shall be in an amount
not less than $5,000,000. In the event of any such sale by a Lender of a
participating interest to a Participant, such Lender's obligations under this
Agreement shall remain unchanged, such Lender shall remain solely responsible
for the performance thereof, such Lender shall remain the holder of any such
Note for all purposes under this Agreement, and the Borrowers and the Agent
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement. In no event shall a
Lender that sells a participation be obligated to the Participant to take or
refrain from taking any action hereunder except that such Lender may agree that
it will not (except as provided below), without the consent of the Participant,
agree to (i) the extension of any date fixed for the payment of principal of or
interest on the related loan or loans, (ii) the reduction of the amount of any
principal, interest or fees due on any date fixed for the payment thereof with
respect to the related loan or loans, (iii) the reduction of the principal of
the related loan or loans, (iv) any reduction in the rate at which either
interest is payable thereon or (if the Participant is entitled to any part
thereof) fee is payable hereunder from the rate at which the Participant is
entitled to receive interest or fee (as the case may be) in respect of such
participation, (v) the release or substitution of all or any substantial part of
the collateral (if any) held as security for the Loans, or (vi) the release of
any Guarantee given to support payment of the Loans. Each Lender selling a
participating interest to any Person other than an Affiliate or Related Fund of
such Lender in any Loan, Note, Commitment or other interest under this
Agreement, will, within 10 Domestic Business Days of such sale, provide the
Borrowers and the Agent with written notification stating that such sale has
occurred and identifying the Participant and the interest purchased by such
Participant. The Borrowers agree that each Participant shall be entitled to the
benefits of ARTICLE 8 with respect to its participation in Loans outstanding
from time to time.
(c) Any Lender may at any time assign to one or more
Persons, provided that any such Person is a commercial bank, finance company,
insurance company or other financial institution or fund which, in each case, in
the ordinary course of business extends credit of the type contemplated herein
and whose becoming an assignee would not constitute a prohibited transaction
under Section 4975 of ERISA, is organized under laws of the United States of
America or any state and having total assets in excess of $5,000,000,000 or an
Affiliate or Related Fund of any such Person, and is acceptable to Agent in its
sole discretion (each an "Assignee") all or a proportionate part of its rights
and obligations under this Agreement, the
108
Notes and the other Credit Documents, and such Assignee shall assume all such
rights and obligations, pursuant to an Assignment and Acceptance, executed by
such Assignee, such transferor Lender and the Agent (and, in the case of an
Assignee that is not then a Lender, subject to clause (iii) below, by the
Borrowers); provided that (i) no interest may be sold by a Lender pursuant to
this paragraph (c) unless the Assignee shall agree to assume ratably equivalent
portions of the transferor Lender's Commitment, (ii) if a Lender is assigning
only a portion of its Commitment, then, the amount of the Commitment being
assigned (determined as of the effective date of the assignment) shall be in an
amount not less than $5,000,000, (iii) no interest may be sold by a Lender
pursuant to this paragraph (c) to any Assignee that is not then a Lender (or an
Affiliate or Related Fund of a Lender) without the prior written consent of the
Agent, and, unless a Default or Event of Default is in existence, the Borrowers
(whose consent shall not be unreasonably withheld or delayed), and (iv) a Lender
may not have more than 3 Assignees that are not then Lenders (or an Affiliate or
Related Fund thereof) at any one time. Upon (v) execution of the Assignment and
Acceptance by such transferor Lender, such Assignee, the Agent and (if
applicable) the Borrowers, (w) delivery of an executed copy of the Assignment
and Acceptance to the Borrowers and the Agent, (x) payment by such Assignee to
such transferor Lender of an amount equal to the purchase price agreed between
such transferor Lender and such Assignee, (y) payment of a processing and
recordation fee of $4,000 to the Agent, and (z) recordation of such assignment
on the Register, as defined and provided below, such Assignee shall for all
purposes be a Lender party to this Agreement and shall have all the rights and
obligations of a Lender under this Agreement to the same extent as if it were an
original party hereto with a Commitment as set forth in such instrument of
assumption, and the transferor Lender shall be released from its obligations
hereunder to a corresponding extent, and no further consent or action by the
Borrowers, the Lenders or the Agent shall be required. The Borrowers hereby
designate the Agent to serve as the Borrowers' agent, solely for purposes of
this SECTION 10.08(c), to maintain a register (the "Register") on which it will
record the Commitments from time to time of each of the Lenders, the Loans made
by each of the Lender and each repayment in respect of the principal amount of
the Loans of each Lender. Failure to make any such recordation, or any error in
such recordation shall not affect the Borrowers' obligations in respect of such
Loans. With respect to any Lenders, the transfer of any Commitment of such
Lenders and the rights to the principal of, and interest on, any Loan shall not
be effective until such transfer is recorded on the Register maintained by the
Agent with respect to ownership of such Commitment and Loans and prior to such
recordation all amounts owing to the transferor with respect to such Commitment
and Loans shall remain owing to the transferor. The registration of assignment
or transfer of all or part of any Commitment and Loans shall be recorded by the
Agent on the Register only upon the acceptance by the Agent of a properly
executed and delivered Assignment and Acceptance pursuant to this SECTION
10.08(c). Coincident with the delivery of such an Assignment and Acceptance to
the Agent for acceptance and registration of assignment or transfer of all or
part of a Commitment and/or Loan, or as soon thereafter as practicable, the
assigning or transferor Lender shall surrender the Note evidencing such
Commitment and/or Loan, and thereupon one or more new Notes in the aggregate
principal amount so assigned shall be issued to the new Lender and, if
applicable, a new Note shall be issued to the assigning or transferor Lender in
the remaining aggregate principal amount of its Commitment and/or Loan not so
assigned. The Borrower agrees to indemnify the Agent from and against any and
all losses, claims, damages and liabilities of whatsoever nature which may be
imposed on, asserted against or incurred by the Agent in
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performing its duties under this SECTION 10.08(c); but excluding any such
losses, claims, damages and liabilities incurred by reason of the gross
negligence or willful misconduct of the Agent. Each Lender agrees to indemnify
the Borrowers and the Agent from and against any and all losses, claims, damages
and liabilities of whatsoever nature which may be imposed on, asserted against
or incurred by the Borrowers or the Agent by reason of the inaccuracy of any
information which is furnished by such Lender concerning such Lender or its
Lending Office or the amount assigned pursuant to an Assignment and Acceptance
Agreement.
(d) Subject to the provisions of SECTION 10.09, the
Borrowers and the Guarantors authorize each Lender to disclose to any
Participant, Assignee or other transferee (each a "Transferee") and any
prospective Transferee any and all financial information in such Lender's
possession concerning the Borrowers or the Guarantors which has been delivered
to such Lender by the Borrowers or the Guarantors pursuant to this Agreement or
which has been delivered to such Lender by the Borrowers or the Guarantors in
connection with such Lender's credit evaluation prior to entering into this
Agreement.
(e) No Transferee shall be entitled to receive any
greater payment under SECTION 2.11 or 8.03 than the transferor Lender would have
been entitled to receive with respect to the rights transferred, unless such
transfer is made with the Borrowers' prior written consent or by reason of the
provisions of SECTION 8.02 or 8.03 requiring such Lender to designate a
different Lending Office under certain circumstances or at a time when the
circumstances giving rise to such greater payment did not exist.
(f) Anything in this SECTION 10.08 to the contrary
notwithstanding, any Lender may assign and pledge all or any portion of the
Loans and/or obligations owing to it to any Federal Reserve Bank or the United
States Treasury as collateral security pursuant to Regulation A of the Board of
Governors of the Federal Reserve System and any Operating Circular issued by
such Federal Reserve Bank, provided that any payment in respect of such assigned
Loans and/or obligations made by the Borrowers to the assigning and/or pledging
Lender in accordance with the terms of this Agreement shall satisfy the
Borrowers' obligations hereunder in respect of such assigned Loans and/or
obligations to the extent of such payment. No such assignment shall release the
assigning and/or pledging Lender from its obligations hereunder.
SECTION 10.09. Confidentiality. The Agent and each Lender
acknowledges and agrees that each of the Borrowers and each of the Guarantors
regard all information provided by it or on its behalf to the Agent or any
Lender pursuant hereto or in connection herewith, other than information that is
or becomes publicly available without breach of a confidentiality obligation
(collectively, "Information"), as proprietary, highly confidential and
sensitive. Accordingly, the Agent and each Lender agrees to use Information only
for purposes of this Agreement and the transactions contemplated hereby and keep
confidential all Information from anyone other than persons employed by the
Agent or such Lender on a strict "need to know" basis and so long as such
parties are notified of the confidential nature of such Information; provided
that nothing herein shall prevent the Agent or any Lender from disclosing such
information (a) to any other Lender, (b) upon the order of any court or
administrative agency having jurisdiction over the Agent or such Lender, (c)
upon the request or demand of any regulatory agency or authority having
jurisdiction over the Agent or such Lender, (d) which has
110
been publicly disclosed other than as a result of breach of this Agreement, (e)
to the extent reasonably required in connection with any litigation relating to
this Agreement to which the Agent, any Lender or their respective Affiliates may
be a party, (f) to the extent reasonably required in connection with the
exercise of any remedy hereunder, (g) to such Lender's legal counsel and
independent auditors and (h) to any actual or proposed Participant, Assignee or
other Transferee of all or part of its rights hereunder which has agreed in
writing to be bound by the provisions of this SECTION 10.09; provided that
should disclosure of any Information be required by virtue of clause (b) or (c)
of the immediately preceding sentence, to the extent permitted by law, any
relevant Lender shall promptly notify the Borrowers or the Guarantors of same so
as to allow the Borrowers or the Guarantors to seek a protective order or to
take any other appropriate action; provided, further, that, no Lender shall be
required to delay compliance with any directive to disclose any such information
so as to allow the Borrowers or the Guarantors to effect any such action.
Notwithstanding anything herein to the contrary, "Information"
shall not include, and the Lender may disclose to any and all persons, without
limitation of any kind, any information with respect to the U.S. federal income
tax treatment and U.S. federal income tax structure of the transactions
contemplated hereby and all materials of any kind (including opinions or other
tax analyses) that are provided to the Lender relating to such tax treatment and
tax structure.
SECTION 10.10. Representation by Lenders. Each Lender hereby
represents that it is a commercial lender or financial institution which makes
loans in the ordinary course of its business and that it will make its Loans
hereunder for its own account in the ordinary course of such business; provided
that, subject to SECTION 10.08, the disposition of the Note or Notes held by
that Lender shall at all times be within its exclusive control.
SECTION 10.11. Obligations Several. The obligations of each
Lender hereunder are several, and no Lender shall be responsible for the
obligations or commitment of any other Lender hereunder. Nothing contained in
this Agreement and no action taken by the Lenders pursuant hereto shall be
deemed to constitute the Lenders to be a partnership, an association, a joint
venture or any other kind of entity. The amounts payable at any time hereunder
to each Lender shall be a separate and independent debt, and each Lender shall
be entitled to protect and enforce its rights arising out of this Agreement or
any other Credit Document and it shall not be necessary for any other Lender to
be joined as an additional party in any proceeding for such purpose.
SECTION 10.12. New York Law. This Agreement and each Note
shall be construed in accordance with and governed by the law of the State of
New York (without giving effect to the conflict of laws principles thereof,
other than Section 5-1401 of the New York General Obligations Law).
SECTION 10.13. Severability. In case any one or more of the
provisions contained in this Agreement, the Notes or any of the other Credit
Documents should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein and therein shall not in any way be affected or impaired thereby and
shall be enforced to the greatest extent permitted by law.
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SECTION 10.14. Interest.
In no event shall the amount of interest, and all charges,
amounts or fees contracted for, charged or collected pursuant to this Agreement,
the Notes or the other Credit Documents and deemed to be interest under
applicable law (collectively, "Interest") exceed the highest rate of interest
allowed by applicable law (the "Maximum Rate"), and in the event any such
payment is inadvertently received by any Lender, then the excess sum (the
"Excess") shall be credited as a payment of principal, unless the Borrowers
shall notify such Lender in writing that it elects to have the Excess returned
forthwith. It is the express intent hereof that the Borrowers not pay and the
Lenders not receive, directly or indirectly in any manner whatsoever, interest
in excess of that which may legally be paid by the Borrowers under applicable
law. The right to accelerate maturity of any of the Loans does not include the
right to accelerate any interest that has not otherwise accrued on the date of
such acceleration, and the Agent and the Lenders do not intend to collect any
unearned interest in the event of any such acceleration. All monies paid to the
Agent or the Lenders hereunder or under any of the Notes or the other Credit
Documents, whether at maturity or by prepayment, shall be subject to rebate of
unearned interest as and to the extent required by applicable law. By the
execution of this Agreement, each of the Borrowers covenants, to the fullest
extent permitted by law, that (i) the credit or return of any Excess shall
constitute the acceptance by the Borrowers of such Excess, and (ii) the
Borrowers shall not seek or pursue any other remedy, legal or equitable, against
the Agent or any Lender, based in whole or in part upon contracting for charging
or receiving any Interest in excess of the Maximum Rate. For the purpose of
determining whether or not any Excess has been contracted for, charged or
received by the Agent or any Lender, all interest at any time contracted for,
charged or received from the Borrowers in connection with this Agreement, the
Notes or any of the other Credit Documents shall, to the extent permitted by
applicable law, be amortized, prorated, allocated and spread in equal parts
throughout the full term of the Commitments. The Borrowers, the Agent and each
Lender shall, to the maximum extent permitted under applicable law, (x)
characterize any non-principal payment as an expense, fee or premium rather than
as Interest and (y) exclude voluntary prepayments and the effects thereof. The
provisions of this SECTION 10.14 shall be deemed to be incorporated into each
Note and each of the other Credit Documents (whether or not any provision of
this SECTION 10.14 is referred to therein). All such Credit Documents and
communications relating to any Interest owed by the Borrowers and all figures
set forth therein shall, for the sole purpose of computing the extent of
obligations hereunder and under the Notes and the other Credit Documents be
automatically recomputed by the Borrowers, and by any court considering the
same, to give effect to the adjustments or credits required by this SECTION
10.14.
SECTION 10.15. Interpretation. No provision of this Agreement
or any of the other Credit Documents shall be construed against or interpreted
to the disadvantage of any party hereto by any court or other governmental or
judicial authority by reason of such party having or being deemed to have
structured or dictated such provision.
SECTION 10.16. WAIVER OF JURY TRIAL; CONSENT TO JURISDICTION.
EACH OF THE BORROWERS (A) AND EACH OF THE LENDERS AND THE AGENT IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING ARISING OUT OF THIS AGREEMENT, ANY OF THE OTHER
CREDIT DOCUMENTS, OR ANY OF THE
112
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, (B) SUBMITS TO THE NONEXCLUSIVE
PERSONAL JURISDICTION IN THE STATE OF NEW YORK, THE COURTS THEREOF AND THE
UNITED STATES DISTRICT COURTS SITTING THEREIN, FOR THE ENFORCEMENT OF THIS
AGREEMENT, THE NOTES AND THE OTHER CREDIT DOCUMENTS, (C) WAIVES ANY AND ALL
PERSONAL RIGHTS UNDER THE LAW OF ANY JURISDICTION TO OBJECT ON ANY BASIS
(INCLUDING, WITHOUT LIMITATION, INCONVENIENCE OF FORUM) TO JURISDICTION OR VENUE
WITHIN THE STATE OF NEW YORK FOR THE PURPOSE OF LITIGATION TO ENFORCE THIS
AGREEMENT, THE NOTES OR THE OTHER CREDIT DOCUMENTS, AND (D) AGREES THAT SERVICE
OF PROCESS MAY BE MADE UPON IT IN THE MANNER PRESCRIBED IN SECTION 10.01 FOR THE
GIVING OF NOTICE TO THE BORROWERS. NOTHING HEREIN CONTAINED, HOWEVER, SHALL
PREVENT THE AGENT FROM BRINGING ANY ACTION OR EXERCISING ANY RIGHTS AGAINST ANY
SECURITY AND AGAINST THE BORROWERS PERSONALLY, AND AGAINST ANY ASSETS OF THE
BORROWERS, WITHIN ANY OTHER STATE OR JURISDICTION.
SECTION 10.17. Counterparts. This Agreement may be signed in
any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
SECTION 10.18. Source of Funds -- ERISA. Each of the Lenders
hereby severally (and not jointly) represents to the Borrowers that no part of
the funds to be used by such Lender to fund the Loans hereunder from time to
time constitutes (a) assets allocated to any separate account maintained by such
Lender in which any employee benefit plan (or its related trust) has any
interest nor (b) any other assets of any employee benefit plan. As used in this
SECTION 10.18, the terms "employee benefit plan" and "separate account" shall
have the respective meanings assigned to such terms in Section 3 of ERISA.
SECTION 10.19. Credit Inquiries. Each Borrower and each
Guarantor hereby authorizes and permits the Agent and each Lender, at its
discretion and without any obligation to do so, to respond to credit inquiries
from third parties concerning any Borrower, any Guarantor or any of its
Subsidiaries, subject to SECTION 10.09.
SECTION 10.20. Consequential Damages. NONE OF (A) THE LENDERS
NOR THE AGENT SHALL BE RESPONSIBLE OR LIABLE TO THE BORROWERS, THE GUARANTORS OR
ANY OTHER PERSON OR ENTITY, NOR (B) THE BORROWERS NOR THE GUARANTORS SHALL BE
RESPONSIBLE OR LIABLE TO THE LENDERS, THE AGENT OR ANY OTHER PERSON OR ENTITY,
FOR ANY PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A
RESULT OF THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.
SECTION 10.21. Entire Agreement. This Agreement, together with
the other Credit Documents, constitute the entire agreement among the parties
hereto with respect to the subject matter hereof, and supersede and replace any
agreement, written or oral, existing between or among the parties hereto in
respect of such subject matter.
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SECTION 10.22. Continuing Agreement. This Agreement, together
with all other Credit Documents, shall continue in full force and effect,
notwithstanding the termination of any one, or more or all of the Commitments or
the payment in full of one, or more of all of the Obligations, unless and until
all Commitments have been terminated, all Letters of Credit have expired or
terminated and all Obligations due and owing on the date of termination (other
than any Obligations of the type described in clauses (c) and (d) of the
definition of such term) have been fully paid and satisfied, each in accordance
with the terms and conditions hereof and of the other Credit Documents;
provided, however, that so long as Obligations of the type described in clauses
(c) and (d) of the definition of such term are outstanding, such Obligations
shall continue to be secured by the Collateral, the Agent shall continue to
serve as collateral agent with respect thereto and the covenants in this
Agreement and the Credit Documents pertaining to insuring, maintaining and
preserving the Collateral, and Events of Default pertaining thereto, shall
continue in force and effect, unless and only to the extent waived by Wachovia
or any other Lender or any Affiliate of either to whom any such Obligations are
owed or that is the other contracting party in any agreement giving rise to such
Obligations. Once all Obligations have been paid or collateralized pursuant
hereto or waived, the Agent and the Lenders shall execute, deliver and record
all documents and instruments necessary to release all Liens and security
interests in favor of the Agent and the Lenders on all Collateral at the
Borrowers' expense.
[Signatures are contained on the following pages.]
114
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, under seal, by their respective authorized officers as of the day
and year first above written.
BORROWERS:
XXXXXX INC.
By: /s/ Xxxxxxx X. Xxxxx (SEAL)
----------------------
Name: Xxxxxxx X. Xxxxx
Title: V.P.
0000 Xxxxxxx Xxxxxxxxx
Xxxxx 000
Xx. Xxxxx, XX 00000
Telecopier No. (000) 000-0000
Confirmation No. (000) 000-0000
BELDEN TECHNOLOGIES, INC.
By: /s/ Xxxxxxx X. Xxxxx (SEAL)
----------------------
Name: Xxxxxxx X. Xxxxx
Title: V.P.
0000 Xxxxxxx Xxxxxxxxx
Xxxxx 000
Xx. Xxxxx, XX 00000
Telecopier No. (000) 000-0000
Confirmation No. (000) 000-0000
BELDEN COMMUNICATIONS COMPANY
By: /s/ Xxxxxxx X. Xxxxx (SEAL)
----------------------
Name: Xxxxxxx X. Xxxxx
Title: V.P.
000 Xxxxx 00xx Xxxxxx
Xxxxxxx, XX 00000
Telecopier No. (000) 000-0000
Confirmation No. (000) 000-0000
115
XXXXXX WIRE & CABLE COMPANY
By: /s/ Xxxxxxx X. Xxxxx (SEAL)
-----------------------
Name: Xxxxxxx X. Xxxxx
Title: V.P.
0000 X.X. Xxxxxxx 00 Xxxxx
Xxxxxxxx, XX 00000
Telecopier No. (000) 000-0000
Confirmation No. (000) 000-0000
116
COMMITMENTS U.S. BANK NATIONAL ASSOCIATION (SEAL)
Revolving Loan
Commitment:
$22,500,000.00
By: /s/
----------------------------------------
Title
Lending Office
U.S. Bank National Association
One US Bank Plaza, 5th Floor
MLC: SL-MO-T5BC
Xx. Xxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Telecopier number: 000-000-0000
Confirmation number: 000-000-0000
117
COMMITMENTS COMERICA BANK, (SEAL)
Revolving Loan
Commitment:
$7,500,000.00
By: /s/
----------------------------------------
Title
Lending Office
Comerica Bank
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxxxx
Telecopier number: 000-000-0000
Confirmation number: 000-000-0000
118
COMMITMENTS THE NORTHERN TRUST COMPANY (SEAL)
Revolving Loan
Commitment:
$7,500,000.00
By: /s/
----------------------------------------
Title
Lending Office
The Northern Trust Company
00 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx XxXxxxxxx
Telecopier number: 000-000-0000
Confirmation number: 000-000-0000
119
COMMITMENTS ING BANK N.V. (SEAL)
Revolving Loan
Commitment:
$7,500,000.00
By: /s/
----------------------------------------
Title
Lending Office
ING Bank N.V.
X.X. Xxx 00x
____________________________________________
____________________________________________
Attention: B.F.G. Xxxxxx
Telecopier number:__________________________
Confirmation number:________________________
120
COMMITMENTS FIFTH THIRD BANK, INDIANA (SEAL)
Revolving Loan
Commitment:
$5,000,000.00
By: /s/
----------------------------------------
Title
Lending Office
Fifth Third Bank
00 X.X. Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxx Xxxxx
Telecopier number: 000-000-0000
Confirmation number: 000-000-0000
121
COMMITMENTS WACHOVIA BANK, NATIONAL
ASSOCIATION,
as Agent and as a Lender (SEAL)
Revolving Loan
Commitment:
$25,000,000.00
By: /s/
----------------------------------------
Title
Lending Office
Wachovia Bank, National Association
Mail Code GA 8056
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Capital Finance
Telecopier number: 000-000-0000
Confirmation number: 000-000-0000
copy to:
Wachovia Bank, National Association
000 Xxxxx Xxxxxxx Xxxxxx
XX-0
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: Agency Services
Telecopier number: 000-000-0000
Confirmation number: 000-000-0000
TOTAL COMMITMENTS:
Revolving Loans:
$75,000,000.00
122
