Exhibit 10.20
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THIRD AMENDED AND RESTATED CREDIT AGREEMENT
DATED AS OF JULY 1, 1998
AMONG
AURORA FOODS INC.,
AS BORROWER,
THE LENDERS LISTED HEREIN,
AS LENDERS,
THE CHASE MANHATTAN BANK,
AS ADMINISTRATIVE AGENT,
NATIONAL WESTMINSTER BANK PLC,
AS SYNDICATION AGENT
AND
UBS AG, STAMFORD BRANCH,
AS DOCUMENTATION AGENT
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AURORA FOODS INC.
CREDIT AGREEMENT
TABLE OF CONTENTS
SECTION 1.
Page
DEFINITIONS..................................................................................................... 2
1.1 Certain Defined Terms.................................................................................. 2
1.2 Accounting Terms Utilization of GAAP for Purposes of Calculations
Under Agreement............................................................................. 39
1.3 Other Definitional Provisions............................................................... 39
SECTION 2.
AMOUNTS AND TERMS OF COMMITMENTS AND LOANS.................................................. 39
2.1 Commitments; Loans.......................................................................... 39
2.2 Interest on the Loans....................................................................... 46
2.3 Fees........................................................................................ 50
2.4 Repayments, Prepayments and Reductions in Revolving Loan
Commitments; General Provisions Regarding Payments; Application
of Proceeds of Collateral and Payments under Guaranties..................................... 50
2.5 Use of Proceeds............................................................................. 59
2.6 Special Provisions Governing Eurodollar Rate Loans.......................................... 59
2.7 Increased Costs; Taxes; Capital Adequacy.................................................... 62
2.8 Obligation of Lenders and Issuing Lenders to Mitigate....................................... 66
SECTION 3.
LETTERS OF CREDIT............................................................................................... 67
3.1 Issuance of Letters of Credit and Lenders' Purchase of Participations
Therein..................................................................................... 67
3.2 Letter of Credit Fees....................................................................... 69
3.3 Drawings and Payments and Reimbursement of Amounts Paid Under
Letters of Credit........................................................................... 70
3.4 Obligations Absolute........................................................................ 73
3.5 Indemnification; Nature of Issuing Lender's Duties.......................................... 74
3.6 Increased Costs and Taxes Relating to Letters of Credit..................................... 75
SECTION 4.
CONDITIONS TO LOANS AND LETTERS OF CREDIT....................................................................... 76
4.1 Conditions to Term Loans and Revolving Loans................................................ 76
4.2 Conditions to All Loans..................................................................... 80
4.3 Conditions to Letters of Credit............................................................. 81
Page
SECTION 5.
REPRESENTATIONS AND WARRANTIES.................................................................................. 82
5.1 Organization, Powers, Qualification, Good Standing, Business and
Subsidiaries................................................................................ 82
5.2 Authorization of Borrowing, etc............................................................. 83
5.3 Financial Condition......................................................................... 84
5.4 No Material Adverse Change; No Restricted Junior Payments................................... 85
5.5 Title to Properties; Liens; Intellectual Property........................................... 85
5.6 Litigation: Adverse Facts.................................................................. 86
5.7 Payment of Taxes............................................................................ 87
5.8 Performance of Agreements; Materially Adverse Agreements; Material
Contracts................................................................................... 87
5.9 Governmental Regulation..................................................................... 88
5.10 Securities Activities....................................................................... 88
5.11 Employee Benefit Plans...................................................................... 88
5.12 Certain Fees................................................................................ 88
5.13 Environmental Protection.................................................................... 88
5.14 Employee Matters............................................................................ 90
5.15 Solvency.................................................................................... 90
5.17 Related Agreements.......................................................................... 91
5.18 Disclosure.................................................................................. 91
5.19 Subordination of Seller Notes............................................................... 92
5.20 Year 2000 Matters........................................................................... 92
SECTION 6.
AFFIRMATIVE COVENANTS........................................................................................... 92
6.1 Financial Statements and Other Reports...................................................... 93
6.2 Corporate Existence, etc.................................................................... 97
6.3 Payment of Taxes and Claims; Tax Consolidation.............................................. 98
6.4 Maintenance of Properties; Insurance........................................................ 98
6.5 Inspection; Lender Meeting.................................................................. 98
6.6 Compliance with Laws, etc................................................................... 99
6.7 Environmental Disclosure and Inspection..................................................... 99
6.8 Company's Remedial Action Regarding Hazardous Materials.....................................100
6.9 Execution of Subsidiary Guaranty and Subsidiary Security Agreements
by Subsidiaries and Future Subsidiaries.....................................................101
6.10 Conforming Leasehold Interests; Matters Relating to Additional Real
Property Collateral.........................................................................102
6.11 Interest Rate Protection....................................................................104
6.12 Further Assurances..........................................................................104
SECTION 7.
NEGATIVE COVENANTS..............................................105
7.1 Indebtedness................................................................................105
7.2 Liens and Related Matters...................................................................106
7.3 Investments; Joint Ventures.................................................................108
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Page
7.4 Contingent Obligations......................................................................108
7.5 Restricted Junior Payments..................................................................109
7.6 Financial Covenants.........................................................................110
7.7 Restriction on Fundamental Changes; Asset Sales.............................................114
7.8 Sales and Lease-Backs.......................................................................115
7.9 Transactions with Shareholders and Affiliates...............................................116
7.10 Disposal of Subsidiary Stock................................................................116
7.11 Conduct of Business.........................................................................116
7.12 Amendments or Waivers of Certain Related Agreements; Amendments
of Documents Relating to Subordinated Indebtedness; Designation of
"Designated Senior Indebtedness"; Preferred Stock...........................................117
7.13 Fiscal Year.................................................................................118
SECTION 8.
EVENTS OF DEFAULT...............................................................................................118
8.1 Failure to Make Payments When Due...........................................................118
8.2 Default in Other Agreements.................................................................118
8.3 Breach of Certain Covenants.................................................................118
8.4 Breach of Warranty..........................................................................119
8.5 Other Defaults Under Loan Documents.........................................................119
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc........................................119
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc..........................................119
8.8 Judgments and Attachments...................................................................120
8.9 Dissolution.................................................................................120
8.10 Employee Benefit Plans......................................................................120
8.11 Change in Control...........................................................................120
8.12 Invalidity of Guaranties....................................................................121
8.13 Failure of Security.........................................................................121
8.14 Termination or Breach of Certain Transition Agreements, and Xxxxxx
Xxxxx Transaction Agreements................................................................121
8.15 Default Under Subordination Provisions......................................................121
SECTION 9.
AGENTS....................................................122
9.1 Appointment.................................................................................122
9.2 Powers; General Immunity....................................................................124
9.3 Representations and Warranties; No Responsibility For Appraisal of Creditworthiness.........125
9.4 Right to Indemnity..........................................................................126
9.5 Successor Agents and Swing Line Lender......................................................126
9.6 Collateral Documents........................................................................127
SECTION 10.
MISCELLANEOUS...................................................................................................127
10.1 Assignments and Participations in Loans, Letters of Credit..................................127
10.2 Expenses....................................................................................130
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Page
10.3 Indemnity...................................................................................131
10.4 Set-Off; Security Interest in Deposit Accounts..............................................132
10.5 Ratable Sharing.............................................................................132
10.6 Amendments and Waivers......................................................................133
10.7 Independence of Covenants...................................................................135
10.8 Notices.....................................................................................135
10.9 Survival of Representations, Warranties and Agreements......................................135
10.10 Failure or Indulgence Not Waiver; Remedies Cumulative.......................................135
10.11 Marshalling; Payments Set Aside.............................................................136
10.12 Severability................................................................................136
10.13 Obligations Several; Independent Nature of Lenders' Rights..................................136
10.14 Headings....................................................................................136
10.15 Applicable Law..............................................................................137
10.16 Successors and Assigns......................................................................137
10.17 Consent to Jurisdiction and Service of Process..............................................137
10.18 Waiver of Jury Trial........................................................................138
10.19 Confidentiality.............................................................................138
10.20 Counterparts; Effectiveness.................................................................139
iv
ANNEXES
Annex A Pricing Grid
EXHIBITS
I FORM OF NOTICE OF BORROWING
II FORM OF NOTICE OF CONVERSION/CONTINUATION
III FORM OF NOTICE OF ISSUANCE OF LETTER OF CREDIT
IV FORM OF TRANCHE A TERM NOTE
V FORM OF REVOLVING NOTE
VI FORM OF SWING LINE NOTE
VII FORM OF SUBSIDIARY GUARANTY
VIII FORM OF PLEDGE AGREEMENT
IX FORM OF SECURITY AGREEMENT
X FORM OF VAN XX XXXX'X PATENT AND TRADEMARK SECURITY
AGREEMENT
XI FORM OF COMPLIANCE CERTIFICATE
XII FORM OF OPINION OF COUNSEL TO LOAN PARTIES
XIII FORM OF OPINION OF XXXXXXX XXXXXXX & XXXXXXXX
XIV FORM OF OPINION OF LOCAL COUNSEL
XV FORM OF ASSIGNMENT AGREEMENT
XVI FORM OF PERMITTED SELLER NOTE
XVII FORM OF CERTIFICATE RE NON-BANK STATUS
XVIII FORM OF COLLATERAL ACCOUNT AGREEMENT
XIX FORM OF COLLATERAL ACCESS AGREEMENT
XX FORM OF MORTGAGE
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SCHEDULES
2.1 LENDERS' COMMITMENTS AND PRO RATA SHARES; LENDING OFFICES
4.1C CORPORATE AND CAPITAL STRUCTURE; MANAGEMENT
5.5B OTHER NECESSARY INTELLECTUAL PROPERTY RIGHTS; MATERIAL
CONTRACTS
5.5C OTHER NECESSARY INTELLECTUAL PROPERTY RIGHTS; MATERIAL
CONTRACTS (LOG CABIN)
5.5D OTHER NECESSARY INTELLECTUAL PROPERTY RIGHTS; MATERIAL
CONTRACTS (XXXXXX XXXXX)
5.5E OTHER NECESSARY INTELLECTUAL PROPERTY RIGHTS; MATERIAL
CONTRACTS (VAN XX XXXX'X)
5.8 MATERIAL CONTRACTS
7.6E STIPULATED CONSOLIDATED EBITDA AND CONSOLIDATED CAPITAL
EXPENDITURES
vi
AURORA FOODS INC.
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
This THIRD AMENDED AND RESTATED CREDIT AGREEMENT is dated as
of July 1, 1998 and entered into by and among AURORA FOODS INC., a newly formed
Delaware corporation ("Aurora"), THE FINANCIAL INSTITUTIONS LISTED ON THE
SIGNATURE PAGES HEREOF (each individually referred to herein as a "Lender" and
collectively as "Lenders"), THE CHASE MANHATTAN BANK, as administrative agent
for Lenders (in such capacity, "Administrative Agent"), NATIONAL WESTMINSTER
BANK PLC, as syndication agent (in such capacity, "Syndication Agent") and UBS
AG, Stamford Branch, as documentation agent (in such capacity, "Documentation
Agent").
R E C I T A L S
WHEREAS, A Foods (capitalized terms used in these recitals
without definition shall have the respective meanings assigned in subsection 1.1
hereof), Aurora Foods Holdings Inc. ("Holdings") and certain financial
institutions (the "Existing Lenders") are parties to the Second Amended and
Restated Credit Agreement, dated as of January 16, 1998 (the "Existing Credit
Agreement"), pursuant to which the Existing Lenders made loans to, and acquired
participations in letters of credit for the account of, A Foods to enable A
Foods to consummate the transactions contemplated by the Xxxxxx Xxxxx
Acquisition Agreement;
WHEREAS, Company proposes to (i) issue Company Common Stock in
an initial public offering (the "Initial Public Offering"), (ii) issue
$200,000,000 principal amount of New Subordinated Notes and (iii) refinance
certain of its existing Indebtedness (collectively, the "Transaction").
WHEREAS, as at the date of the Initial Public Offering,
Company will be the survivor of mergers involving A Foods, Holdings, Aurora, VDK
Holdings, and Van xx Xxxx'x (collectively, the "Merged Companies").
WHEREAS, Company desires that Existing Lenders and the New
Lenders amend and restate the Existing Credit Agreement to provide term loan
facilities in an aggregate principal amount of $225,000,000 (the "Term Loan
Facilities") and a revolving credit facility in an aggregate principal amount of
$175,000,000 (the "Revolving Credit Facility") which, together with proceeds
from the Initial Public Offering and the proceeds from the issuance of the New
Subordinated Notes, will be used (i) to refinance existing Indebtedness under
the Existing Credit Agreement and under the VDK Credit Agreement, (ii) to repay
the outstanding principal and associated prepayment premium on the VDK
Subordinated Notes, (iii) to pay Transaction Costs and (iv) to provide financing
for working capital and other general corporate purposes (including
acquisitions) of Company and its Subsidiaries;
WHEREAS, Company desires that all of its future Subsidiaries
guaranty all of the
obligations of Company with respect to the credit facilities provided by
Lenders;
WHEREAS, Company desires to secure all of the Obligations and
desires that all of its future Subsidiaries secure their respective obligations
under the Subsidiary Guaranty, by granting to Administrative Agent, for the
benefit of Agents and Lenders, (i) a first priority Lien on substantially all of
their respective real and personal property and (ii) a first priority pledge of
all of the capital stock of their respective direct Subsidiaries;
NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, Company, Lenders and
Agents agree as follows:
SECTION 1.
DEFINITIONS
1.1 Certain Defined Terms.
The following terms used in this Agreement shall have the
following meanings:
"A Foods" means AurFoods Operating Co. Inc., a Delaware
corporation, formerly Aurora Foods Inc. and MBW Foods Inc.
"Acquisition" means the transactions contemplated by the
Acquisition Agreement.
"Acquisition Agreement" means that certain Asset Purchase
Agreement dated as of December 18, 1996, by and between Company and
Seller, as in effect on the Closing Date and as such agreement may
thereafter be amended, restated, supplemented or otherwise modified
from time to time to the extent permitted under subsection 7.12A.
"Adjusted Eurodollar Rate" means, for any Interest Rate
Determination Date, the rate per annum obtained by dividing (i) the
London Interbank offered rate for deposits in U.S. Dollars for
maturities comparable to the Interest Period for which such Adjusted
Eurodollar Rate will apply as of approximately 11:00 A.M. (London time)
on such Interest Rate Determination Date as set forth on Telerate Page
3750 by (ii) a percentage equal to 100% minus the stated maximum rate
of all reserve requirements (including, without limitation, any
marginal, emergency, supplemental, special or other reserves)
applicable on such Interest Rate Determination Date to any member bank
of the Federal Reserve System in respect of "Eurocurrency liabilities"
as defined in Regulation D (or any successor category of liabilities
under Regulation D).
"Adjustment Date" means the first Business Day following
receipt by the Administrative Agent of both (i) the financial
statements required to be delivered pursuant to subsection 6.1(ii) or
6.1(iii), as the case may be, for the most recently
completed fiscal period and (ii) the certificate required to be
delivered pursuant to subsection 6.1(iv) with respect to such fiscal
period.
"Administrative Agent" means Chase, in its capacity as
Administrative Agent, and any successor to Chase in such capacity
appointed pursuant to subsection 9.5A.
2
"Affected Lender" has the meaning assigned to that term in
subsection 2.6C.
"Affected Loans" has the meaning assigned to that term in
subsection 2.6C.
"Affiliate" means, as applied to any Person, any other Person
directly or indirectly controlling, controlled by, or under common
control with, that Person. For the purposes of this definition,
"control" (including, with correlative meanings, the terms
"controlling", "controlled by" and "under common control with"), as
applied to any Person, means the possession, directly or indirectly, of
the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting
securities or by contract or otherwise.
"Agent" means, individually, each of Administrative Agent, the
Syndication Agent and the Documentation Agent, and "Agents" means
Administrative Agent, the Syndication Agent and the Documentation
Agent, collectively.
"Aggregate Amounts Due" has the meaning assigned to that term
in subsection 10.5.
"Agreement" means this Third Amended and Restated Credit
Agreement dated as of July 1, 1998, as it may be amended, restated,
supplemented or otherwise modified from time to time.
"Anniversary" means each of the dates that are anniversaries
of the Effective Date.
"Applicable Margin" means the Applicable Margin set forth on
Annex A hereto opposite the level for which the ratio of Consolidated
Total Debt to Consolidated EBITDA so determined satisfies the
corresponding criteria set forth under the heading "Ratio of
Consolidated Total Debt to Consolidated EBITDA", which Applicable
Margin shall be adjusted on each Adjustment Date; provided that in the
event that the financial statements required to be delivered pursuant
to subsection 6.1(ii) and (iii), as applicable, and the related
certificate required pursuant to subsection 6.1(iv), are not delivered
when due, then if such financial statements are not delivered prior to
the date upon which the resultant Potential Event of Default shall
become an Event of Default, then, effective upon such Potential Event
of Default becoming an Event of Default, during the period from the
date upon which such financial statements were required to be delivered
until one Business Day following the date upon which they actually are
delivered, the Applicable Margin with respect to Revolving Loan and
Tranche A Term Loans shall be 1.50%, if such Loans are Base Rate Loans
and 2.50%, if such Loans are Eurodollar Rate Loans and with respect to
the Commitment Fee shall be 0.50%, and provided further that for the
period until September 30, 1998, the Applicable Margin shall be no less
than the Applicable Margin corresponding to Xxxxx 0, as set forth on
Annex A in the column headed "Less than 4.75:1 but Greater than or
Equal to 4.25:1."
"Applied Amount" has the meaning assigned to that term in
subsection 2.4C(ii).
3
"Approved Fund" means, with respect to a Lender that is a fund
that invests in loans, any other fund that invests in loans and has the
same investment advisor as such Lender or is managed by an Affiliate of
such investment advisor.
"Asset Sale" means the sale (including in any sale-leaseback
transaction) by Company or any of its Subsidiaries to any Person (other
than Company or any of its Wholly Owned Subsidiaries) of (i) any of the
stock of any of Company's Subsidiaries, (ii) all or substantially all
of the assets of any division or line of business of Company or any of
its Subsidiaries, or (iii) any other assets other than sales of assets
(including without limitation inventory) in the ordinary course of
business and sales of obsolete equipment, excluding any such other
assets to the extent that the aggregate value of such assets sold in
any single transaction or transactions is equal to $5,000,000 or less
in any one Fiscal Year.
"Assignment Agreement" means an assignment agreement in
substantially the form of Exhibit XV annexed hereto or in such other
form as may be approved by Administrative Agent.
"Assumption Agreement" means that certain Assignment and
Assumption Agreement dated as of December 31, 1996, by and between
Seller and Company, as in effect on the Closing Date and as such
agreement may thereafter be amended, restated, supplemented or
otherwise modified from time to time to the extent permitted under
subsection 7.12A.
"Aurora" has the meaning assigned to that term in the Recitals
to this Agreement.
"Bankruptcy Code" means Title 11 of the United States Code
entitled "Bankruptcy", as now and hereafter in effect, or any successor
statute.
"Base Rate" means, at any time, the higher of (x) the Prime
Rate, (y) the rate which is 1/2 of 1% in excess of the Federal Funds
Effective Rate or (z) the secondary market rate for certificates of
deposit (grossed up for maximum statutory reserve requirements) plus
1.00%.
"Base Rate Loans" means Loans bearing interest at rates
determined by reference to the Base Rate as provided in subsection
2.2A.
"Business" means the assets and liabilities of Company
relating to the manufacture and sale of pancake syrup and pancake and
waffle mix marketed under the Xxx. Xxxxxxxxxxx'x and Country Crock
brand names, as set forth in the Acquisition Agreement.
"Business Day" means (i) for all purposes other than as
covered by clause (ii) below, any day excluding Saturday, Sunday and
any day which is a legal holiday under the laws of the State of New
York or is a day on which banking institutions located in such state
are authorized or required by law or other governmental action to
close, and (ii)
4
with respect to all notices, determinations, fundings,
issuances and payments in connection with the Adjusted Eurodollar Rate
or any Eurodollar Rate Loans, any day that is a Business Day described
in clause (i) above and that is also (a) a day for trading by and
between banks in Dollar deposits in the London interbank market and (b)
a day on which banking institutions are open for business in London.
"CALPERS" means the California Public Employees Retirement
System.
"Capital Lease" means, as applied to any Person, any lease of
any property (whether real, personal or mixed) by that Person as lessee
that, in conformity with GAAP, is accounted for as a capital lease on
the balance sheet of that Person.
"Cash" means money, currency or a credit balance in a Deposit
Account.
"Cash Equivalents" means (i) marketable securities issued or
directly and unconditionally guaranteed by the United States Government
or issued by any agency thereof and backed by the full faith and credit
of the United States, in each case maturing within one year from the
date of acquisition thereof; (ii) marketable direct obligations issued
by any state of the United States of America or any political
subdivision of any such state or any public instrumentality thereof
maturing within one year from the date of acquisition thereof and, at
the time of acquisition, having the highest rating obtainable from
either Standard & Poor's Rating Service ("S&P") or Xxxxx'x Investors
Service, Inc. ("Moody's"); (iii) commercial paper maturing no more than
one year from the date of creation thereof and, at the time of
acquisition, having a rating of at least A-1 from S&P or at least P-1
from Moody's; (iv) certificates of deposit or bankers' acceptances
maturing within one year from the date of acquisition thereof and, at
the time of acquisition, having a rating of at least A-1 from S&P or at
least P-1 from Moody's, issued by any Lender or any commercial bank
organized under the laws of the United States of America or any state
thereof or the District of Columbia having unimpaired capital and
surplus of not less than $250,000,000 (each Lender and each such
commercial bank being herein called a "Cash Equivalent Bank"); and (v)
Eurodollar time deposits having a maturity of less than one year
purchased directly from any Cash Equivalent Bank (provided such deposit
is with such Cash Equivalent Bank or any other Cash Equivalent Bank).
"Cash Proceeds" means, with respect to any Asset Sale, Cash
payments (including any Cash received by way of deferred payment
pursuant to, or monetization of, a note receivable or otherwise, but
only as and when so received) received by Company or any of its
Subsidiaries from such Asset Sale.
"Certificate re Non-Bank Status" means a certificate
substantially in the form of Exhibit XVII annexed hereto delivered by a
Lender to Administrative Agent pursuant to subsection 2.7B(iii).
"Chase" means The Chase Manhattan Bank and its successors,
including, without limitation, its successors by merger.
"Closing Date" means December 31, 1996.
5
"Collateral" means all of the properties and assets (including
capital stock) in which Liens are purported to be granted by the
Collateral Documents.
"Collateral Access Agreement" means any landlord waiver,
mortgagee waiver, bailee letter or any similar acknowledgement or
agreement of any landlord or mortgagee in respect of any Real Property
Asset where any Collateral is located or any warehouseman or processor
in possession of any Inventory of any Loan Party, substantially in the
form of Exhibit XIX annexed hereto with such changes thereto as may be
agreed to by Administrative Agent in the reasonable exercise of its
discretion.
"Collateral Account" has the meaning assigned to that term in
the Collateral Account Agreement.
"Collateral Account Agreement" means the Collateral Account
Agreement executed and delivered by Company and Administrative Agent on
the Effective Date, substantially in the form of Exhibit XVIII annexed
hereto, pursuant to which Company may pledge cash to Administrative
Agent to secure the obligations of Company to reimburse Issuing Lenders
for payments made under one or more Letters of Credit as such
Collateral Account Agreement may hereafter be amended, restated,
supplemented or otherwise modified from time to time.
"Collateral Documents" means the Pledge Agreement, the
Security Agreement, the Patent and Trademark Security Agreement, the
Log Cabin Patent and Trademark Security Agreement, the Xxxxxx Xxxxx
Patent and Trademark Security Agreement, the Van xx Xxxx'x Patent and
Trademark Agreement, the Collateral Account Agreement, the Mortgages
and any other documents, instruments or agreements delivered by any
Loan Party pursuant to this Agreement or any of the other Loan
Documents in order to grant or perfect liens on any assets of such Loan
Party as security for the Obligations.
"Commercial Letter of Credit" means any letter of credit or
similar instrument issued for the purpose of providing the primary
payment mechanism in connection with the purchase of any materials,
goods or services by Company or any of its Subsidiaries in the ordinary
course of business of Company or such Subsidiary.
"Commitment Fee" and "Commitment Fees" have the meanings
assigned to such terms in subsection 2.3A.
"Commitments" means the commitments of Lenders to make Loans
as set forth in subsection 2.1A.
"Company" means, prior to the Effective Date, A Foods, and on
and after the Effective Date, Aurora.
"Company Common Stock" means the common stock of Company, par
value $0.01 per share.
6
"Compliance Certificate" means a certificate substantially in
the form of Exhibit XI annexed hereto delivered to Administrative Agent
by Company pursuant to subsection 6.1(iv).
"Condemnation Proceeds" has the meaning assigned to that term
in subsection 2.4B(iii)(d).
"Conforming Leasehold Interest" means any Recorded Leasehold
Interest as to which the lessor has agreed in writing for the benefit
of Administrative Agent (which writing has been delivered to
Administrative Agent), whether under the terms of the applicable lease,
under the terms of a Landlord Consent and Estoppel, or otherwise, to
the matters described in the definition of "Landlord Consent and
Estoppel," which interest, if a subleasehold or sub-subleasehold
interest, is not subject to any contrary restrictions contained in a
superior lease or sublease.
"Consolidated Capital Expenditures" means, for any period, the
aggregate amount paid or accrued by Company and its Subsidiaries for
the rental, lease, purchase (including by way of the acquisition of
Securities of a Person), construction or use of any property during
such period, the value or cost of which, in conformity with GAAP, would
appear on the consolidated balance sheet of Company and its
Subsidiaries in the category of "purchases of property, plant or
equipment" at the end of such period, excluding any such expenditure
made to restore, replace or rebuild property to the condition of such
property immediately prior to any damage, loss, destruction or
condemnation of such property, to the extent such expenditure is made
with insurance proceeds or condemnation awards relating to any such
damage, loss, destruction or condemnation; provided, however, that
Consolidated Capital Expenditures shall not include expenditures up to
an aggregate amount equal to the portion of the purchase price for any
Permitted Acquisition made pursuant to subsection 7.7(vi) that would
otherwise be treated as a Consolidated Capital Expenditure.
"Consolidated Cash Interest Coverage Ratio" means, for any
period, the ratio of (i) Consolidated EBITDA for such period to (ii)
Consolidated Cash Interest Expense for such period.
"Consolidated Cash Interest Expense" means, for any period,
Consolidated Interest Expense payable in Cash during such period.
"Consolidated Current Assets" means, as at any date of
determination, the total assets of Company and its Subsidiaries on a
consolidated basis which may properly be classified as current assets
in conformity with GAAP, excluding Cash and Cash Equivalents and any
current tax asset.
"Consolidated Current Liabilities" means, as at any date of
determination, the total liabilities of Company and its Subsidiaries on
a consolidated basis which may properly be classified as current
liabilities in conformity with GAAP, but excluding all short-term
Indebtedness for borrowed money and the current portion of any
long-term Indebtedness of the Company, in each case to the extent
included therein, and any current
7
taxes payable and the current portion of any deferred taxes.
"Consolidated EBITDA" means; for any period, (i) the sum of
the amounts for such period of (a) Consolidated Net Income, plus (b) to
the extent deducted in determining such Consolidated Net Income, (1)
Consolidated Interest Expense, (2) depreciation, (3) depletion, (4)
amortization, (5) all federal, state, local and foreign income taxes,
(6) transaction fees paid to the MDC Entities and/or Dartford and/or
Fenway in connection with acquisitions made after the Effective Date,
so long as such transaction fees are paid in accordance with the terms
of the MDC Advisory Services Agreement, the Dartford Management
Agreement and the Fenway Advisory Agreement, (7) non-recurring charges
incurred prior to September 30, 1998 related to the Log Cabin Business,
with respect to (A) relocation of Company's assets, (B) the purchase of
computers and computer-related equipment and (C) transition related
expenses in connection with the foregoing, but only to the extent that
such non-recurring charges, together with all expenditures excluded
from Consolidated Capital Expenditures under clause (iii) (a) of the
definition of Consolidated Fixed Charges, do not exceed $6,000,000 in
the aggregate, (8) non-recurring charges incurred prior to June 30,
1999 with respect to relocation of the Company's assets related to the
Xxxxxx Xxxxx Business and transition related expenses in connection
therewith, but only to the extent that such non-recurring charges,
together with all expenditures excluded from Consolidated Capital
Expenditures under clause (iii)(b) of the definition of Consolidated
Fixed Charges, do not exceed $15,000,000 in the aggregate,
(9) manufacturing overhead costs related to the Xxxxxx Xxxxx
Transitional Supply Agreement not to exceed $8,200,000 per year as long
as the Xxxxxx Xxxxx Transitional Supply Agreement is in effect, (10)
all other non-cash items reducing Consolidated Net Income and (11) any
extraordinary and unusual losses, minus (ii) the sum of the amounts for
such period of (a) all other non-cash items increasing Consolidated Net
Income, plus (b) any extraordinary and unusual gains, all of the
foregoing as determined on a consolidated basis for Company and its
Subsidiaries in conformity with GAAP and calculated in accordance with
subsection 7.6E, if applicable.
"Consolidated Excess Cash Flow" means, for any period, an
amount (if positive) equal to (i) the sum, without duplication, of the
amounts for such period of (a) Consolidated EBITDA, (b) to the extent
deducted from Consolidated EBITDA by virtue of clause (ii)(b) of the
definition thereof, extraordinary and unusual cash gains, and (c) the
Consolidated Working Capital Adjustment minus (ii) the sum, without
duplication, of the amounts for such period of (a) voluntary and
scheduled cash repayments of Consolidated Total Debt (excluding
repayments of Revolving Loans except to the extent the Revolving Loan
Commitments are permanently reduced in connection with such
repayments), (b) Consolidated Capital Expenditures (net of any proceeds
of any related financings with respect to such expenditures), (c)
expenditures made in connection with any Permitted Acquisition pursuant
to subsection 7.7(vi) (net of any proceeds of any related financings
with respect to such acquisitions), including without limitation
transaction fees paid in cash to the MDC Entities and/or Dartford
and/or Fenway in connection with such acquisitions, so long as such
transaction fees are paid in accordance with the terms of the MDC
Advisory Services Agreement, the Dartford Management Agreement and the
Fenway Agreement, (d) Consolidated Interest Expense, (e) to the extent
added back to Consolidated EBITDA by virtue of clause (i)(b)(11) of the
8
definition thereof, extraordinary and unusual cash losses, (f) to the
extent added back to Consolidated EBITDA by virtue of clauses (i)(b)(7)
or (i)(b)(8) of the definition thereof, non-recurring charges paid in
cash, (g) to the extent added back to Consolidated EBITDA by virtue of
clause (i)(b)(9) of the definition thereof, manufacturing overhead
costs related to the Xxxxxx Xxxxx Transitional Supply Agreement, and
(h) the provision for current taxes based on income of Company and its
Subsidiaries and payable in cash with respect to such period.
"Consolidated Fixed Charges" means, for any period, an amount
equal to the sum of the amounts for such period of (i) scheduled
amortization of Indebtedness of Company and its Subsidiaries (as
reduced by prepayments previously made), and discount or premium
relating to any such Indebtedness for such period, whether expensed or
capitalized, (ii) Consolidated Cash Interest Expense, (iii)
Consolidated Capital Expenditures (excluding (a) expenditures which
would otherwise be included in Consolidated Capital Expenditures
incurred prior to September 30, 1998 related to the Log Cabin Business,
with respect to (1) relocation of Company's assets, (2) the purchase of
computers and computer-related equipment and (3) transition related
expenses in connection with the foregoing, but only to the extent that
such expenditures, together with all non-recurring charges added back
to Consolidated EBITDA by virtue of clause (i)(b)(7) of the definition
thereof, do not exceed $6,000,000 in the aggregate and (b) expenditures
which would otherwise be included in Consolidated Capital Expenditures
incurred prior to June 30, 1999 with respect to relocation of the
Company's assets related to the Xxxxxx Xxxxx Business and transition
related expenses in connection therewith, but only to the extent that
such expenditures, together with all non-recurring charges added back
to Consolidated EBITDA by virtue of clause (i)(b)(8) of the definition
thereof, do not exceed $15,000,000 in the aggregate), and (iv) taxes
actually paid in cash by Company or any of its Subsidiaries.
"Consolidated Interest Expense" means, for any period, the net
interest expense of Company and its Subsidiaries for such period (net
of any interest income of Company and its Subsidiaries during such
period) as determined on a consolidated basis in conformity with GAAP.
"Consolidated Net Income" means, for any period, the net
income (or loss) of Company and its Subsidiaries on a consolidated
basis for such period taken as a single accounting period determined in
conformity with GAAP; provided that there shall be excluded (i) the
income (or loss) of any Person in which any other Person (other than
Company or any of the Subsidiaries) has a joint interest, except to the
extent of the amount of dividends or other distributions actually paid
in cash to Company or any of its Subsidiaries by such Person during
such period and (ii) the income (or loss) of any Person accrued prior
to the date it becomes a Subsidiary of Company or is merged into or
consolidated with Company or any of its Subsidiaries or the date such
Person's assets are acquired by Company or any of its Subsidiaries.
"Consolidated Total Debt" means, as at any date of
determination, all outstanding Indebtedness of Company and its
Subsidiaries as determined on a consolidated basis in conformity with
GAAP.
9
"Consolidated Total Senior Debt" means, as at any date of
determination, all outstanding Indebtedness of Company and its
Subsidiaries other than Subordinated Indebtedness, as determined on a
consolidated basis in conformity with GAAP.
"Consolidated Working Capital" means, as at any date of
determination, the excess of Consolidated Current Assets over
Consolidated Current Liabilities.
"Consolidated Working Capital Adjustment" means, for any
period on a consolidated basis, the amount (which may be a negative
number) by which Consolidated Working Capital as of the beginning of
such period exceeds (or is less than) Consolidated Working Capital as
of the end of such period.
"Contingent Obligation" means, as applied to any Person, any
direct or indirect liability, contingent or otherwise, of that Person
(i) with respect to any Indebtedness, lease, dividend or other
obligation of another if the primary purpose or intent thereof by the
Person incurring the Contingent Obligation is to provide assurance to
the obligee of such obligation of another that such obligation of
another will be paid or discharged, or that any agreements relating
thereto will be complied with, or that the holders of such obligation
will be protected (in whole or in part) against loss in respect
thereof, (ii) with respect to any letter of credit issued for the
account of that Person or as to which that Person is otherwise
liable for reimbursement of drawings, or (iii) under Interest Rate
Agreements. Contingent Obligations shall include, without limitation,
(a) the direct or indirect guaranty, endorsement (otherwise than for
collection or deposit in the ordinary course of business), comaking,
discounting with recourse or sale with recourse by such Person of the
obligation of another, (b) the obligation to make take-or-pay or
similar payments if required regardless of non-performance by any other
party or parties to an agreement, and (c) any liability of such Person
for the obligation of another through any agreement (contingent or
otherwise) (x) to purchase, repurchase or otherwise acquire such
obligation or any security therefor, or to provide funds for the
payment or discharge of such obligation (whether in the form of loans,
advances, stock purchases, capital contributions or otherwise) or (y)
to maintain the solvency or any balance sheet item, level of income or
financial condition of another if, in the case of any agreement
described under subclauses (x) or (y) of this sentence, the primary
purpose or intent thereof is as described in the preceding sentence.
The amount of any Contingent Obligation shall be equal to the amount of
the obligation so guaranteed or otherwise supported or, if less, the
amount to which such Contingent Obligation is specifically limited.
"Continuing Director" shall mean, as of any date of
determination, any member of the Board of Directors of Company who (i)
was a member of such Board of Directors on the Effective Date or (ii)
was nominated for election or elected to such Board of Directors with
the affirmative vote of the MDC Entities and/or Dartford and/or Fenway.
"Contractual Obligation" means, as applied to any Person, any
provision of any Security issued by that Person or of any material
indenture, mortgage, deed of trust, contract, undertaking, agreement or
other instrument to which that Person is a party or by
10
which it or any of its properties is bound or to which it or any of its
properties is subject.
"CSI" means Chase Securities Inc. and its successors and
assigns, including, without limitation, its successors by merger.
"Dartford" means Dartford Partnership L.L.C., a limited
liability company organized under the laws of the State of Delaware.
"Dartford Advisory Agreement" means that certain Advisory
Agreement dated as of April 8, 1998, by and between Company and
Dartford, as in effect on the Effective Date and as such agreement may
thereafter be amended, restated, supplemented or otherwise modified
from time to time to the extent permitted under subsection 7.12A.
"Dartford Expense Agreement" means that certain Expense
Agreement dated as of July 1, 1998, by and between Company and
Dartford, as in effect on the Effective Date and as such agreement may
thereafter be amended, restated, supplemented or otherwise modified
from time to time to the extent permitted under subsection 7.12A.
"Defaulting Lender" means any Lender with respect to which a
Lender Default is in effect.
"Deposit Account" means a demand, time, savings, passbook or
like account with a bank, savings and loan association, credit union or
like organization, other than an account evidenced by a negotiable
certificate of deposit.
"Documentation Agent" has the meaning assigned to that term in
the introduction to this Agreement.
"Dollars" and the sign "$" mean the lawful money of the United
States of America.
"Xxxxxx Xxxxx Acquisition" means the transactions contemplated
by the Xxxxxx Xxxxx Acquisition Agreement.
"Xxxxxx Xxxxx Acquisition Agreement" means that certain Asset
Sale and Purchase Agreement, dated as of November 26, 1997 by and
between MBW LLC and P&G, which agreement was assigned to the Company.
"Xxxxxx Xxxxx Assumption Agreement" means that certain
Assumption Agreement dated as of January 16, 1998, by and between P&G
and Company.
"Xxxxxx Xxxxx Business" has the meaning assigned to that term
in the Recitals to this Agreement.
"Xxxxxx Xxxxx Patent and Trademark Security Agreement" means
that certain Patent and Trademark Security Agreement dated as of
January 16, 1998, by and between Company and Chase, as in effect on the
Effective Date and as such agreement may
11
thereafter be amended, restated, supplemented or otherwise modified
from time to time to the extent permitted under subsections 7.12A.
"Xxxxxx Xxxxx Patent License Agreement" means that certain
Patent License Agreement dated as of January 16, 1998, by and between
P&G and Company, as in effect on the Effective Date and as such
agreement may thereafter be amended, restated, supplemented or
otherwise modified from time to time to the extent permitted under
subsection 7.12A.
"Xxxxxx Xxxxx Related Agreements" means the Xxxxxx Xxxxx
Acquisition Agreement, the Xxxxxx Xxxxx Assumption Agreement and the
Xxxxxx Xxxxx Transition Agreements.
"Xxxxxx Xxxxx Technology License Agreement" means the
Technology License Agreement dated as of January 16, 1998, by and
between P&G and the Company as in effect on the Effective Date and as
such agreement may thereafter be amended, restated, supplemented or
otherwise modified from time to time to the extent permitted under
Section 7.12A.
"Xxxxxx Xxxxx Transition Agreements" means, collectively, (i)
the Xxxxxx Xxxxx Transitional Supply Agreement, (ii) the Xxxxxx Xxxxx
Transition Services Agreement, (iii) the Xxxxxx Xxxxx Technology
License Agreement and (iv) the Xxxxxx Xxxxx Patent License Agreement.
"Xxxxxx Xxxxx Transition Services Agreement" means the
Transitional Services Agreement, dated as of January 16, 1998, by and
between P&G and Company as in effect on the Effective Date and as such
agreement may thereafter be amended, restated, supplemented or
otherwise modified from time to time to the extent permitted under
subsection 7.12A.
"Xxxxxx Xxxxx Transitional Supply Agreement" means the
Transitional Supply Agreement, dated as of January 16, 1998, by and
between P&G and the Company as in effect on the Effective Date and as
such agreement may thereafter be amended, restated, supplemented or
otherwise modified from time to time to the extent permitted under
subsection 7.12A.
"Effective Date" means the date (on or before July 1, 1998) on
which the conditions precedent set forth in subsection 4.1 shall be
satisfied or waived.
"Eligible Assignee" means (i) (a) a commercial bank organized
under the laws of the United States or any state thereof; (b) a
commercial bank organized under the laws of any other country or a
political subdivision thereof; provided that (x) such bank is acting
through a branch or agency located in the United States or (y) such
bank is organized under the laws of a country that is a member of the
Organization for Economic Cooperation and Development or a political
subdivision of such country; (c) any other entity which is an
"accredited investor" (as defined in Regulation D under the Securities
Act) which extends credit or buys loans as one of its businesses
including, but not limited
12
to, insurance companies, funds and lease financing companies; and
(d) any other financial institution or fund (whether a corporation,
partnership, trust or other entity) that is engaged in making,
purchasing or otherwise investing in commercial loans in the ordinary
course of its business and has combined capital and surplus or net
assets of at least $100,000,000, in each case (under clauses
(a) through (d) above) that is reasonably acceptable to Administrative
Agent; and (ii) any Lender, any Affiliate of any Lender, and any
Approved Fund; provided that no Affiliate of Company shall be an
Eligible Assignee.
"Employee Benefit Plan" means any "employee benefit plan" as
defined in Section 3(3) of ERISA which is subject to ERISA and which is
maintained or contributed to by Company or any of its ERISA Affiliates.
"Environmental Claim" means any written accusation,
allegation, notice of violation, claim, demand, abatement order or
other order or direction (conditional or otherwise) by any governmental
authority or any Person for any damage, including, without limitation,
personal injury (including sickness, disease or death), tangible or
intangible property damage, contribution, indemnity, indirect or
consequential damages, damage to the environment, nuisance, pollution,
contamination or other adverse effects on the environment, or for
fines, penalties or restrictions, in each case relating to, resulting
from or in connection with Hazardous Materials and relating to Company,
any of its Subsidiaries, any of their respective Affiliates that are
directly or indirectly controlled by Company, or any Facility.
"Environmental Laws" means all laws, statutes, ordinances,
orders, rules, regulations, plans, policies or decrees and the like
relating to (i) environmental matters, including, without limitation,
those relating to fines, injunctions, penalties, damages, contribution,
cost recovery compensation, losses or injuries resulting from the
Release or threatened Release of Hazardous Materials, (ii) the
generation, use, storage, transportation or disposal of Hazardous
Materials, or (iii) occupational safety and health, public health and
safety, industrial hygiene or protection of wetlands, in any manner
applicable to Company or any of its Subsidiaries or any of their
respective properties, including, without limitation, the Comprehensive
Environmental Response, Compensation, and Liability Act (42 U.S.C. ss.
9601 et seq.), the Hazardous Materials Transportation Act (49 U.S.C.
ss. 1801 et seq.,), the Resource Conservation and Recovery Act (42
U.S.C. ss. 6901 et seq.), the Federal Water Pollution Control Act (33
U.S.C. ss. 1251 et seq.), the Clean Air Act (42 U.S.C. ss. 7401 et
seq.), the Toxic Substances Control Act (15 U.S.C. ss. 2601 et seq.),
the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C. ss.136
et seq.), the Occupational Safety and Health Act (29 U.S.C. ss. 651 et
seq.), and the Emergency Planning and Community Right-to-Know Act (42
U.S.C. ss. 11001 et seq.), each as amended or supplemented, and any
analogous future or present local, state and federal statutes and
regulations promulgated pursuant thereto, each as in effect as of the
date of determination.
"Equity Proceeds" means the cash proceeds (net of underwriting
discounts and commissions and other reasonable costs associated
therewith) from the issuance of any equity Securities of Company after
the Effective Date.
13
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor statute.
"ERISA Affiliate" means, as applied to any Person, (i) any
corporation which is a member of a controlled group of corporations
within the meaning of Section 414(b) of the Internal Revenue Code of
which that Person is a member; (ii) any trade or business (whether or
not incorporated) which is a member of a group of trades or businesses
under common control within the meaning of Section 414(c) of the
Internal Revenue Code of which that Person is a member; and (iii)
solely for purposes of obligations under Section 412 of the Internal
Revenue Code or under the applicable sections set forth in Section
414(t)(2) of the Internal Revenue Code, any member of an affiliated
service group within the meaning of Section 414(m) or (o) of the
Internal Revenue Code of which that Person, any corporation described
in clause (i) above or any trade or business described in clause (ii)
above is a member.
"ERISA Event" means (i) a "reportable event" within the
meaning of Section 4043(c) of ERISA and the regulations issued
thereunder with respect to any Pension Plan (excluding those for which
the provision for 30-day notice to the PBGC has been waived by
regulation or with respect to which no penalty will be assessed by the
PBGC for failure to satisfy such notice requirements); (ii) the failure
to meet the minimum funding standard of Section 412 of the Internal
Revenue Code with respect to any Pension Plan (whether or not waived in
accordance with Section 412(d) of the Internal Revenue Code) or the
failure to make by its due date a required installment under Section
412(m) of the Internal Revenue Code with respect to any Pension Plan or
the failure to make any required contribution to a Multiemployer Plan;
(iii) the provision by the administrator of any Pension Plan pursuant
to Section 4041(a)(2) of ERISA of a notice of intent to terminate such
plan in a distress termination described in Section 4041(c) of ERISA;
(iv) the withdrawal by Company or any of its ERISA Affiliates from any
Pension Plan with two or more contributing sponsors or the termination
of any such Pension Plan resulting, in either case, in liability
pursuant to Section 4063 or 4064 of ERISA, respectively; (v) the
institution by the PBGC of proceedings to terminate any Pension Plan
pursuant to Section 4042 of ERISA; (vi) the imposition of liability on
Company or any of its ERISA Affiliates pursuant to Section 4062(e) or
4069 of ERISA or by reason of the application of Section 4212(c) of
ERISA; (vii) the withdrawal by Company or any of its ERISA Affiliates
in a complete or partial withdrawal (within the meaning of Sections
4203 and 4205 of ERISA) from any Multiemployer Plan resulting in
withdrawal liability pursuant to Section 4201 of ERISA, or the receipt
by Company or any of its ERISA Affiliates of written notice from any
Multiemployer Plan that it is in reorganization or insolvency pursuant
to Section 4241 or 4245 of ERISA, or that it intends to terminate or
has terminated under Section 4042 of ERISA or under Section 4041A of
ERISA if such termination would result in liability to Company or any
of its ERISA Affiliates; (viii) the imposition on Company or any of its
ERISA Affiliates of fines, penalties or taxes under Chapter 43 of the
Internal Revenue Code or under Section 409 or 502(c), (i) or (l) or
4071 of ERISA in respect of any Employee Benefit Plan; (ix) the failure
of any Pension Plan (or any other Employee Benefit Plan intended to be
qualified under Section 401(a) of the Internal Revenue Code) to qualify
under Section 401(a) of the Internal Revenue Code, or
14
the failure of any trust forming part of any Pension Plan to
qualify for exemption from taxation under Section 501(a) of the
Internal Revenue Code; or (x) the imposition of a Lien pursuant to
Section 401(a)(29) or 412(n) of the Internal Revenue Code or pursuant
to ERISA with respect to any Pension Plan.
"Eurodollar Rate Loans" means Loans bearing interest at rates
determined by reference to the Adjusted Eurodollar Rate as provided in
subsection 2.2A.
"Event of Default" means each of the events set forth in
Section 8.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute.
"Existing Credit Agreement" has the meaning assigned to that
term in the Recitals to this Agreement.
"Existing Lenders" has the meaning assigned to that term in
the Recitals to this Agreement.
"Existing Subordinated Note Documents" means the Existing
Subordinated Note Indentures, the Existing Subordinated Notes and each
other document executed in connection with the Existing Subordinated
Notes, as each such document may be amended, restated, supplemented or
otherwise modified from time to time to the extent permitted under
subsection 7.12B.
"Existing Subordinated Note Indentures" means the indentures
pursuant to which the Existing Subordinated Notes are issued, in a form
delivered to Agents and Lenders on or prior to the Effective Date, with
such changes thereto as are permitted under subsection 7.12B and as
such indentures may thereafter be amended, restated, supplemented or
otherwise modified from time to time to the extent permitted under
subsection 7.12B.
"Existing Subordinated Notes" means (a) the 9-7/8% Series B
Senior Subordinated Notes of Company due 2007 issued on February 10,
1997 and (b) the 9- 7/8% Series D Senior Subordinated Notes of the
Company due 2007 issued on July 1, 1997 pursuant to the Existing
Subordinated Note Indentures in the form delivered to Agents and
Lenders on or prior to the Effective Date with such changes thereto as
are permitted under subsection 7.12B and as such notes may thereafter
be amended, restated, supplemented or otherwise modified from time to
time to the extent permitted under subsection 7.12B.
"Facilities" means any and all real property (including,
without limitation, all buildings, fixtures or other improvements
located thereon) now, hereafter or heretofore owned, leased, operated
or used by Company or any of its Subsidiaries (but only as to portions
of buildings actually leased or used) or any of their respective
predecessors or any of their respective Affiliates that are directly or
indirectly controlled by Company.
"Federal Funds Effective Rate" means, for any period, a
fluctuating interest rate
15
equal for each day during such period to the weighted average of the
rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published
for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day which is a Business Day, the
average of the quotations for such day on such transactions received by
Administrative Agent from three Federal funds brokers of recognized
standing selected by Administrative Agent.
"Fenway" means Fenway Partners Capital Fund, L.P., a Delaware
limited partnership.
"Fenway Advisory Agreement" means that certain Advisory
Agreement dated as of April 8, 1998, by and between Company and Fenway,
as in effect on the Effective Date and as such agreement may thereafter
be amended, restated, supplemented or otherwise modified from time to
time to the extent permitted under subsection 7.12A.
"FFDC Act" means the Federal Food, Drug and Cosmetic Act, as
amended from time to time, and any successor statute.
"First Priority" means, with respect to any Lien purported to
be created in any Collateral pursuant to any Collateral Document, that
(i) such Lien has priority over any other Lien on such Collateral and
(ii) such Lien is the only Lien (other than Permitted Encumbrances and
Liens permitted pursuant to subsection 7.2A) to which such Collateral
is subject.
"Fiscal Quarter" means a fiscal quarter of a Fiscal Year.
"Fiscal Year" means the fiscal year of Company and its
Subsidiaries ending on December 31 of each calendar year.
"Fixed Charge Component" has the meaning assigned to that term
in subsection 7.6E(i).
"Flavor Supply Agreement" means that certain Flavor Supply
Agreement dated as of December 31, 1996, by and between Company and
Quest, as in effect on the Closing Date and as such agreement may
thereafter be amended, restated, supplemented or otherwise modified
from time to time to the extent permitted under subsection 7.12A.
"Flood Hazard Property" means a Mortgaged Property located in
an area designated by the Federal Emergency Management Agency as having
special flood or mud slide hazards.
"Funding and Payment Office" means the office of
Administrative Agent and Swing Line Lender located at One Chase
Xxxxxxxxx Xxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 or such offices of
Administrative Agent or any successor Administrative Agent specified by
Administrative Agent or such successor Administrative Agent in a
written notice to Loan Parties and Lenders).
16
"Funding Date" means the date of the funding of a Loan.
"GAAP" means, subject to the limitations on the application
thereof set forth in subsection 1.2, generally accepted accounting
principles set forth in opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such other
entity as may be approved by a significant segment of the accounting
profession, in each case as the same are applicable to the
circumstances as of the date of determination and specifically, terms
used herein applicable to Company and its Subsidiaries defined by
reference to GAAP shall give effect to the subtraction of minority
interests.
"Gilster Co-Pack Agreement" means the Production Agreement,
dated as of June 4, 1998, by and between the Company and Xxxxxxx-Xxxx
Xxx Corporation, as in effect on the Effective Date and as such
agreement may thereafter be amended, restated, supplemented or
otherwise modified from time to time to the extent permitted under
subsection 7.12A.
"Governmental Acts" has the meaning assigned to that term in
subsection 3.5.
"Governmental Authorization" means any permit, license,
authorization, plan, directive, consent order or consent decree of or
from any federal, state or local governmental authority, agency or
court.
"Guaranty" means, individually, each of the Subsidiary
Guaranty and any other guaranty of the Obligations, and "Guaranties"
means the Subsidiary Guaranty and each other guaranty of the
Obligations, collectively.
"Guarantors" means the Subsidiary Guarantors.
"Hazardous Materials" means (i) any chemical, material or
substance defined as or included in the definition of "hazardous
substances", "hazardous wastes", "hazardous materials", "extremely
hazardous waste", "restricted hazardous waste", "infectious waste",
"toxic substances" or any other formulations intended to define, list
or classify substances by reason of deleterious properties such as
ignitability, corrosivity, reactivity, carcinogenicity, toxicity,
reproductive toxicity, "TCLP toxicity," or "EP toxicity" or words of
similar import under any applicable Environmental Laws; (ii) any oil,
petroleum, petroleum fraction or petroleum derived substance; (iii) any
drilling fluids, produced waters and other wastes associated with the
exploration, development or production of crude oil, natural gas or
geothermal resources; (iv) any flammable substances or explosives;
(v) any radioactive materials; (vi) asbestos in any form; (vii) urea
formaldehyde foam insulation; (viii) electrical equipment which
contains any oil or dielectric fluid containing levels of
polychlorinated biphenyls in excess of fifty parts per million; (ix)
pesticides; and (x) any other chemical, material or substance, exposure
to which is prohibited, limited or regulated by any governmental
authority.
17
"Holdings" has the meaning assigned to that term in the
Recitals to this Agreement.
"Immaterial Subsidiaries" means, with respect to any Person,
any Subsidiary or Subsidiaries of such Person the assets of which
constitute, individually or in the aggregate, less than 5% of the total
assets of such Person and its Subsidiaries.
"Indebtedness" means, as applied to any Person, (i) all
indebtedness for borrowed money, (ii) that portion of obligations with
respect to Capital Leases that is properly classified as a liability on
a balance sheet in conformity with GAAP, (iii) notes payable and drafts
accepted representing extensions of credit whether or not representing
obligations for borrowed money (other than accounts payable incurred in
the ordinary course of business and accrued expenses incurred in the
ordinary course of business), (iv) any obligation owed for all or any
part of the deferred purchase price of property or services (excluding
any such obligations incurred under ERISA), which purchase price is (a)
due more than six months from the date of incurrence of the obligation
in respect thereof or (b) evidenced by a note or similar written
instrument, and (v) all indebtedness secured by any Lien on any
property or asset owned or held by that Person regardless of whether
the indebtedness secured thereby shall have been assumed by that Person
or is nonrecourse to the credit of that Person. Obligations under
Interest Rate Agreements constitute Contingent Obligations and not
Indebtedness.
"Indemnified Liabilities" has the meaning assigned to that
term in subsection 10.3.
"Indemnitee" has the meaning assigned to that term in
subsection 10.3.
"Initial Public Offering" has the meaning assigned to that
term in the Recitals to this Agreement.
"Insurance Proceeds" has the meaning assigned to that term in
subsection 2.4B(iii)(d).
"Intellectual Property" means collectively the MBW
Intellectual Property, the Log Cabin Intellectual Property, the Xxxxxx
Xxxxx Intellectual Property and the Van xx Xxxx'x Intellectual
Property, each as defined in subsections 5.5B, 5.5C, 5.5D and 5.5E,
respectively.
"Interest Payment Date" means (i) with respect to any Base
Rate Loan, the last Business Day of each March, June, September and
December of each year, commencing on September 30, 1998 and (ii) with
respect to any Eurodollar Rate Loan, the last day of each Interest
Period applicable to such Loan; provided that in the case of each
Interest Period of longer than three months, "Interest Payment Date"
shall also include the date that is three months after the commencement
of such Interest Period.
"Interest Period" has the meaning assigned to that term in
subsection 2.2B.
18
"Interest Rate Agreement" means any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement
or other similar agreement or arrangement designed to hedge Company or
any of its Subsidiaries against fluctuations in interest rates.
"Interest Rate Determination Date" means each date for
calculating the Adjusted Eurodollar Rate, for purposes of determining
the interest rate in respect of an Interest Period. The Interest Rate
Determination Date in respect of calculating the Adjusted Eurodollar
Rate shall be the second Business Day prior to the first day of the
related Interest Period.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended to the date hereof and from time to time hereafter.
"Inventory" means, with respect to any Person as of any date
of determination, all goods, merchandise and other personal property
which are then held by such Person for sale or lease, including raw
materials and work in process.
"Investment" means (i) any direct or indirect purchase or
other acquisition by Company or any of its Subsidiaries of, or of a
beneficial interest in, stock or other Securities of any other Person
(other than a Person that, prior to such purchase or acquisition, was a
Wholly Owned Subsidiary of Company), or (ii) any direct or indirect
loan, advance (other than advances to employees for moving,
entertainment and travel expenses, drawing accounts and similar
expenditures in the ordinary course of business) or capital
contribution by Company or any of its Subsidiaries to any other Person
other than a Wholly Owned Subsidiary of Company, including all
Indebtedness and accounts receivable acquired from that other Person
that are not current assets or did not arise from sales to that other
Person in the ordinary course of business; provided, however, that the
term "Investment" shall not include (a) current trade and customer
accounts receivable for goods furnished or services rendered in the
ordinary course of business and payable in accordance with customary
trade terms, (b) advances and prepayments to suppliers for goods and
services in the ordinary course of business, (c) stock or other
securities acquired in connection with the satisfaction or enforcement
of Indebtedness or claims due or owing to Company or any of its
Subsidiaries or as security for any such Indebtedness or claims,
(d) Cash held in Deposit Accounts with banks and trust companies
(other than Lenders) not exceeding $5,000,000 in aggregate amount,
(e) Cash held in any Deposit Account with a Lender and (f) shares in a
mutual fund that invests solely in Cash Equivalents. The amount of any
Investment shall be the original cost of such Investment plus the cost
of all additions thereto, without any adjustments for increases or
decreases in value, or write-ups, write-downs or write-offs with
respect to such Investment.
"IP Collateral" means the Collateral under the Patent and
Trademark Security Agreement, the Log Cabin Patent and Trademark
Security Agreement, the Xxxxxx Xxxxx Patent and Trademark Security
Agreement and the Van xx Xxxx'x Patent and Trademark Security
Agreement.
"Issuing Lender" means, with respect to any Letter of Credit,
the Lender which
19
agrees or is otherwise obligated to issue such Letter
of Credit, determined as provided in subsection 3.1B(ii).
"Joint Venture" means a joint venture, partnership or other
similar arrangement, whether in corporate, partnership or other legal
form; provided that in no event shall any corporate Subsidiary of any
Person be considered to be a Joint Venture to which such Person is a
party.
"Kraft" means Kraft Foods, Inc., a Delaware corporation.
"Landlord Consent and Estoppel" means, with respect to any
Leasehold Property, a letter, certificate or other instrument in
writing from the lessor under the related lease, satisfactory in form
and substance to Administrative Agent, pursuant to which such lessor
agrees, for the benefit of Administrative Agent, (i) that without any
further consent of such lessor or any further action on the part of the
Loan Party holding such Leasehold Property, such Leasehold Property may
be encumbered pursuant to a Mortgage and may be assigned to the
purchaser at a foreclosure sale or in a transfer in lieu of such a sale
(and to a subsequent third party assignee if Administrative Agent, any
Lender, or an Affiliate of either so acquires such Leasehold Property),
(ii) that such lessor shall not terminate such lease as a result of a
default by such Loan Party thereunder without first giving
Administrative Agent notice of such default and at least 30 days (or,
if such default cannot reasonably be cured by Administrative Agent
within such period, such longer period as may reasonably be required)
to cure such default, (iii) to the matters contained in a Collateral
Access Agreement, and (iv) to such other matters relating to such
Leasehold Property as Administrative Agent may reasonably request.
"Leasehold Property" means any leasehold interest of any Loan
Party as lessee under any lease of real property, other than any such
leasehold interest designated from time to time by Administrative Agent
in its sole discretion as not being required to be included in the
Collateral.
"Lender" and "Lenders" means the persons identified as
"Lenders" and listed on the signature pages of this Agreement, together
with their successors and permitted assigns pursuant to subsection
10.1, and the term "Lenders" shall include Swing Line Lender unless the
context otherwise requires, provided that the term "Lenders", when used
in the context of a particular Commitment, shall mean Lenders having
that Commitment.
"Lender Default" shall mean (i) the refusal (which has not
been retracted) of a Lender to make available its portion of any Loans
(including any Revolving Loans made to pay Refunded Swing Line Loans or
to reimburse drawings under Letters of Credit) in accordance with
subsection 2.1A(iii) or its portion of any unreimbursed drawing or
payment under a Letter of Credit in accordance with subsection 3.3C or
(ii) a Lender having notified Company and/or Administrative Agent in
writing that it does not intend to comply with its obligations under
subsection 2.1 or subsections 3.1C, 3.3B or 3.3C.
"Lending Office" means, as to any Lender, the office or
offices of such Lender
20
specified as the "Lending Office" on Schedule 2.1, or such other office
or offices as such Lender may from time to time notify Company and
Administrative Agent.
"Letter of Credit" or "Letters of Credit" means Commercial
Letters of Credit and Standby Letters of Credit issued or to be issued
by Issuing Lenders for the account of Company pursuant to subsection
3.1.
"Letter of Credit Usage" means, as at any date of
determination, the sum of (i) the maximum aggregate amount which is or
at any time thereafter may become available for drawing under all
Letters of Credit then outstanding (whether or not the conditions to
drawing thereunder have been met) plus (ii) the aggregate amount of all
drawings under Letters of Credit honored by Issuing Lenders and not
theretofore reimbursed by Company (including any such reimbursement out
of the proceeds of Revolving Loans pursuant to subsection 3.3B).
"Leverage Ratio" means, as of any date of determination, the
ratio of Consolidated Total Debt, as of the date of determination, to
Consolidated EBITDA, for the twelve-month period ending on the date of
determination, in each case calculated for Company and its Subsidiaries
on a consolidated basis in accordance with GAAP.
"Lien" means any lien, mortgage, pledge, assignment, security
interest, fixed or floating charge or encumbrance of any kind
(including any conditional sale or other title retention agreement, any
lease in the nature thereof, and any agreement to give any security
interest) and any option, trust or other preferential arrangement
having the practical effect of any of the foregoing.
"Loan" or "Loans" means, as the context requires, one or more
of the Term Loans, Revolving Loans and Swing Line Loans or any
combination thereof.
"Loan Documents" means this Agreement, the Notes, the Letters
of Credit (and any applications for, or reimbursement agreements or
other documents or certificates executed by Company in favor of an
Issuing Lender relating to, the Letters of Credit), the Subsidiary
Guaranty, the Collateral Documents and any Interest Rate Agreement
entered into by Company with a Lender or an Affiliate of any Lender.
"Loan Party" means, individually, each of Company and any
Subsidiary Guarantor, and "Loan Parties" means Company and each
Subsidiary Guarantor, collectively.
"Log Cabin Acquisition" means the acquisition of the Log Cabin
Business pursuant to the terms of the Log Cabin Acquisition Agreement.
"Log Cabin Acquisition Agreement" means that certain Asset
Purchase Agreement dated as of May 7, 1997 between the Company and
Kraft.
"Log Cabin Assumption Agreement" means that certain Assumption
Agreement dated as of July 1, 1997, by and between Kraft and Company.
21
"Log Cabin Business" means the assets of the retail syrup
business marketed under the Log Cabin and Country Kitchen trademarks
and the foodservice business marketed under the Log Cabin, Log Cabin
Lite and Wigwam trademarks and under private label arrangements.
"Log Cabin Patent and Trademark Security Agreement" means the
Log Cabin Patent and Trademark Security Agreement entered into by and
among Company, the Subsidiary Guarantors and the Administrative Agent
dated as of July 1, 1997 as in effect on the Effective Date, as such
Log Cabin Patent and Trademark Security Agreement may thereafter be
amended, restated, supplemented or otherwise modified from time to
time.
"Log Cabin Patent License Agreement" means that certain Patent
and Know- How License Agreement dated as of July 1, 1997, by and
between Kraft and Company, as in effect on the Effective Date and as
such agreement may thereafter be amended, restated, supplemented or
otherwise modified from time to time to the extent permitted under
subsection 7.12A.
"Log Cabin Transition Agreements" means the Log Cabin Patent
License Agreement.
"Management Fees" means the fees payable by Company pursuant
to the MDC Advisory Agreement, the Dartford Advisory Agreement and the
Fenway Advisory Agreement.
"Margin Stock" has the meaning assigned to that term in
Regulation U of the Board of Governors of the Federal Reserve System as
in effect from time to time.
"Material Adverse Effect" means (i) a material adverse effect
upon the business, operations, properties, assets, condition (financial
or otherwise) or prospects of Company and its Subsidiaries, taken as a
whole, (ii) the material impairment of the ability of any Loan Party to
perform the Obligations and (iii) a material adverse effect upon the
legality, validity, binding effect or enforceability against a Loan
Party of a Loan Document to which it is a party.
"Material Contract" means any of the Employment Agreements or
any other contract or other arrangement to which Company or any of its
Subsidiaries is a party (other than the Loan Documents) for which
breach, nonperformance, cancellation or failure to renew could have a
Material Adverse Effect.
"Maximum Consolidated Capital Expenditures Amount" has the
meaning assigned to that term in subsection 7.6D.
"MBW LLC" means MBW Investors LLC, a Delaware limited
liability company.
"MDC Advisory Agreement" means that certain Advisory Agreement
dated as of April 8, 1998, by and between Company and MDC Management
Company III, L.P., as in
22
effect on the Effective Date and as such agreement may thereafter be
amended, restated, supplemented or otherwise modified from time to
time to the extent permitted under subsection 7.12A.
"MDC Entities" means XxXxxx De Leeuw & Co. III, L.P., a
California limited partnership, XxXxxx De Leeuw & Co. Offshore (Europe)
III, L.P., a Bermuda limited partnership, XxXxxx De Leeuw & Co. III
(Asia), L.P., a Bermuda limited partnership, Gamma Fund LLC, a
California limited liability company, XxXxxx De Leeuw & Co. IV, L.P., a
California limited partnership, XxXxxx De Leeuw & Co. IV Associates,
L.P., a California limited partnership, and Delta Fund LLC, a
California limited liability company.
"Mortgage" means any mortgage or legal charge (whether
designated as a deed of trust or a mortgage or by any similar title)
granted by Company or any of its Subsidiaries (or, at Administrative
Agent's option, an amendment to an existing Mortgage, in form
satisfactory to Administrative Agent, adding such Mortgaged Property to
the Real Property Assets encumbered by an existing Mortgage) in any
Real Property Asset to secure the Obligations, as such mortgage or
legal charge may be amended, restated, supplemented or otherwise
modified from time to time substantially in the form of Exhibit XX
annexed hereto, and "Mortgages" means all such instruments
collectively.
"Mortgage Policy" has the meaning assigned to that term in
subsection 6.10B(iv).
"Mortgaged Property" has the meaning assigned to that term in
subsection 6.10B.
"Multiemployer Plan" means a "multiemployer plan", as defined
in Section 4001(a)(3) of ERISA which is subject to Title IV of ERISA,
to which Company or any of its ERISA Affiliates is contributing or to
which Company or any of its ERISA Affiliates has an obligation to
contribute.
"NatWest" means National Westminster Bank PLC and its
successors, including, without limitation, its successors by merger.
"Net Cash Proceeds" means, with respect to any Asset Sale,
Cash Proceeds of such Asset Sale net of bona fide direct costs of sale
including, without limitation, (i) income taxes reasonably estimated to
be actually payable as a result of such Asset Sale within one year of
the date of receipt of such Cash Proceeds, (ii) transfer, sales, use
and other taxes payable in connection with such Asset Sale, (iii)
payment of the outstanding principal amount of, premium or penalty, if
any, and interest on any Indebtedness (other than the Loans) that is
secured by a Lien on the stock or assets in question and that is
required to be repaid under the terms thereof as a result of such Asset
Sale, and (iv) broker's commissions and reasonable fees and expenses of
counsel, accountants and other professional advisors in connection with
such Asset Sale.
"New Lender" means any Lender which is a party to this
Agreement on the Effective Date which is not an Existing Lender.
23
"New Subordinated Note Documents" means the New Subordinated
Note Indenture, the New Subordinated Notes and each other document
executed in connection with the New Subordinated Notes, as each such
document may be amended, restated, supplemented or otherwise modified
from time to time to the extent permitted under subsection 7.12B.
"New Subordinated Note Indenture" means the indenture pursuant
to which the New Subordinated Notes are issued, in a form delivered to
Agents and Lenders on or prior to the Effective Date, with such changes
thereto as are permitted under subsection 7.12B and as such indenture
may thereafter be amended, restated, supplemented or otherwise modified
from time to time to the extent permitted under subsection 7.12B.
"New Subordinated Notes" means the 8-3/4% Senior Subordinated
Notes of Company due 2008 issued pursuant to the New Subordinated Note
Indenture in the form delivered to Agents and Lenders on or prior to
the Effective Date with such changes thereto as are permitted under
subsection 7.12B and as such notes may thereafter be amended, restated,
supplemented or otherwise modified from time to time to the extent
permitted under subsection 7.12B.
"Non-Defaulting Lender" means and includes each Lender other
than a Defaulting Lender.
"Non-US Lenders" has the meaning assigned to that term in
subsection 2.7B(iii).
"Notes" means one or more of the Tranche A Term Notes,
Revolving Notes or Swing Line Note or any combination thereof.
"Notice of Borrowing" means a notice in the form of Exhibit I
annexed hereto delivered by Company to Administrative Agent pursuant to
subsection 2.1B with respect to a proposed borrowing.
"Notice of Conversion/Continuation" means a notice
substantially in the form of Exhibit II annexed hereto delivered by
Company to Administrative Agent pursuant to subsection 2.2D with
respect to a proposed conversion or continuation of the applicable
basis for determining the interest rate with respect to the Loans
specified therein.
"Notice of Issuance of Letter of Credit" means a notice in the
form of Exhibit III annexed hereto delivered by Company to
Administrative Agent pursuant to subsection 3.1B(i) with respect to the
proposed issuance of a Letter of Credit.
"Obligations" means all obligations of every nature of each
Loan Party from time to time owed to Agents, Lenders or any of them
under the Loan Documents, whether for principal, interest,
reimbursement of amounts drawn under Letters of Credit or payments for
early termination of Interest Rate Agreements, fees, expenses,
indemnification or otherwise.
"Officer's Certificate" means, as applied to any corporation,
a certificate executed
24
on behalf of such corporation by its chairman of the board (if an
officer), its president, its chief financial officer or a vice
president; provided that every Officer's Certificate with respect to
the compliance with a condition precedent to the making of any Loans
hereunder shall include (i) a statement that the officer making or
giving such Officer's Certificate has read such condition and any
definitions or other provisions contained in this Agreement relating
thereto, (ii) a statement that, in the opinion of the signer he or
she has made or has caused to be made such examination or
investigation as is necessary to enable him or her to express an
informed opinion as to whether or not such condition has been
complied with, and (iii) a statement as to whether, in the opinion
of the signer, such condition has been complied with.
"Operating Lease" means, as applied to any Person, any lease
(including, without limitation, leases that may be terminated by the
lessee at any time) of any property (whether real, personal or mixed)
that is not a Capital Lease other than any such lease under which that
Person is the lessor.
"P&G" means The Procter & Xxxxxx Company, an Ohio corporation.
"Patent and Trademark Security Agreement" means the Patent and
Trademark Security Agreement entered into by and among Company, the
Subsidiary Guarantors and Administrative Agent dated as of the Closing
Date, as such Patent and Trademark Security Agreement may thereafter be
amended, restated, supplemented or otherwise modified from time to
time.
"Patent License Agreement" means that certain Patent License
Agreement dated as of December 31, 1996, by and among Seller, Unilever
PLC and Company, as in effect on the Closing Date and as such agreement
may thereafter be amended, restated, supplemented or otherwise modified
from time to time to the extent permitted under subsection 7.12A.
"PBGC" means the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA (or any successor
thereto).
"Pension Plan" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to Title IV of ERISA.
"Permitted Acquisition" means an acquisition of assets or a
business effected in accordance with the provisions of subsection
7.7(vi).
"Permitted Encumbrances" means the following types of Liens:
(i) Liens for taxes, assessments or governmental
charges or claims the payment of which is not, at the time,
required by subsection 6.3;
(ii) statutory Liens of landlords, statutory Liens
of carriers, warehousemen, mechanics and materialmen and other
Liens imposed by law (other than any such Lien imposed
pursuant to Section 401(a)(29) or 412(n) of the
25
Internal Revenue Code or by ERISA) incurred in the ordinary
course of business for sums not yet delinquent or being
contested in good faith, if such reserve or other appropriate
provision, if any, as shall be required by GAAP shall have
been made therefor;
(iii) Liens incurred or deposits made in the
ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory
obligations, surety and appeal bonds, bids, leases, government
contracts, trade contracts, performance and return-of-money
bonds and other similar obligations (exclusive of obligations
for the payment of borrowed money);
(iv) any attachment or judgment Lien not
constituting an Event of Default under subsection 8.8;
(v) leases or subleases granted to others not
interfering in any material respect with the ordinary conduct
of the business of Company or any of its Subsidiaries;
(vi) easements, rights-of-way, restrictions, minor
defects, encroachments or irregularities in title and other
similar charges or encumbrances not interfering in any
material respect with the ordinary conduct of the business of
Company or any of its Subsidiaries;
(vii) any (a) interest or title of a lessor or
sublessor under any Capital Lease permitted by subsection
7.1(iii) or any Operating Lease not prohibited by this
Agreement, (b) restriction or encumbrance that the interest or
title of such lessor or sublessor may be subject to, or (c)
subordination of the interest of the lessee or sublessee under
such lease to any restriction or encumbrance referred to in
the preceding clause (b);
(viii) Liens arising from filing UCC financing
statements relating solely to leases permitted by this
Agreement;
(ix) Liens in favor of customs and revenue
authorities arising as a matter of law to secure payment of
customs duties in connection with the importation of goods;
(x) deposits in the ordinary course of business
to secure liabilities to insurance carriers, lessors,
utilities and other service providers; and
(xi) bankers liens and rights of setoff with
respect to customary depository arrangements entered into in
the ordinary course of business.
"Permitted Seller Note" means a promissory note substantially
in the form of Exhibit XVI annexed hereto representing any Indebtedness
of Company incurred in connection with any Permitted Acquisition
payable to the seller in connection therewith,
26
as such note may be amended, restated, supplemented or otherwise
modified from time to time to the extent permitted under subsection
7.12B; provided that no Permitted Seller Note shall (i) be
guarantied by any Subsidiary of Company or secured by any property
of Company or any of its Subsidiaries or (ii) bear cash interest at
a rate in excess of 12% per annum; and provided further, that no
Permitted Seller Note shall provide for any prepayment or repayment
of all or any portion of the principal thereof prior to the date of
the final scheduled installment of principal of any of the Loans.
"Person" means and includes natural persons, corporations,
limited partnerships, general partnerships, limited liability
companies, joint stock companies, Joint Ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts
or other organizations, whether or not legal entities, and governments
and agencies and political subdivisions thereof.
"Pledge Agreement" means that certain Third Amended and
Restated Pledge Agreement by and among Company, the Subsidiary
Guarantors and Administrative Agent dated as of the Effective Date and
substantially in the form of Exhibit VIII annexed hereto, as such
Pledge Agreement may be amended, restated, supplemented or otherwise
modified from time to time.
"Pledged Collateral" means the "Pledged Collateral" as
defined in the Pledge Agreement.
"Potential Event of Default" means a condition or event that,
after notice or after any applicable grace period has lapsed, or both,
would constitute an Event of Default.
"Prime Rate" means the rate of interest per annum publicly
announced from time to time by Chase as its prime commercial lending
rate in effect at its principal office in New York City. The Prime Rate
is a reference rate and does not necessarily represent the lowest or
best rate actually charged to any customer. Chase or any other Lender
may make commercial loans or other loans at rates of interest at, above
or below the Prime Rate.
"Proceedings" has the meaning assigned to that term in
subsection 6.1(x).
"Pro Forma Calculation Period" has the meaning assigned to
that term in subsection 7.6E(i).
"Pro Rata Share" means with respect to each Lender, the
Revolving Loan Pro Rata Share and Tranche A Term Loan Pro Rata Share of
such Lender; in any such case as the applicable percentage may be
adjusted by assignments permitted pursuant to subsection 10.1. The
initial Pro Rata Share of each Lender is set forth opposite the name of
that Lender in Schedule 2.1 annexed hereto.
"PTO" means the United States Patent and Trademark Office or
any successor or substitute office in which filings are necessary or,
in the opinion of Administrative Agent, desirable in order to create or
perfect Liens on any IP Collateral.
27
"Pure Food and Drug Laws" means the FFDC Act and the pure food
and drug laws of each of the states of the United States into which
products of the Business, the Log Cabin Business and the Xxxxxx Xxxxx
Business are or have been shipped.
"Quest" means Quest International Flavors & Food Ingredients
Company.
"Quest Agreements" means, collectively, (i) that certain
Flavor Escrow Agreement dated as of December 31, 1996, by and among
Quest, the escrow agent named therein and Company, as in effect on the
Closing Date and as such agreement may thereafter be amended, restated,
supplemented or otherwise modified from time to time to the extent
permitted under subsection 7.12A, and (ii) the Flavor Supply Agreement.
"Real Property Asset" means, at any time of determination, any
interest then owned by any Loan Party in any real property.
"Recorded Leasehold Interest" means a Leasehold Property with
respect to which a Record Document (as hereinafter defined) has been
recorded in all places necessary or desirable, in Administrative
Agent's reasonable judgment, to give constructive notice of such
Leasehold Property to third-party purchasers and encumbrances of the
affected real property. For purposes of this definition, the term
"Record Document" means, with respect to any Leasehold Property, (a)
the lease evidencing such Leasehold Property or a memorandum thereof,
executed and acknowledged by the owner of the affected real property,
as lessor, or (b) if such Leasehold Property was acquired or subleased
from the holder of a Recorded Leasehold Interest, the applicable
assignment or sublease document, executed and acknowledged by such
holder, in each case in form sufficient to give such constructive
notice upon recordation and otherwise in form reasonably satisfactory
to Administrative Agent.
"Red Wing" means The Red Wing Company, Inc., a Delaware
corporation.
"Red Wing Co-Pack Agreement" means each of the First Amended
and Restated Production Agreement, dated as of November 19, 1997, by
and between Red Wing and Company and the Production Agreement, dated as
of November 19, 1997, by and between Red Wing and the Company
(collectively, the "Red Wing Co-Pack Agreements") as in effect on the
Effective Date and as such agreement may thereafter be amended,
restated, supplemented or otherwise modified from time to time to the
extent permitted under subsection 7.12A.
"Refunded Swing Line Loans" has the meaning assigned to that
term in subsection 2.1A(iii).
"Register" has the meaning assigned to that term in
subsection 2.1D.
"Regulation D" means Regulation D of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
28
"Regulatory Shares" means, with respect to any Person, shares
of such Person required to be issued as qualifying shares to directors
or persons similarly situated or shares issued to Persons other than
Company or a Wholly Owned Subsidiary of Company in response to
regulatory requirements of foreign jurisdictions pursuant to a
resolution of the Board of Directors of such Person, so long as such
shares do not exceed one percent of the total outstanding shares of
equity such Person and any owners of such shares irrevocably covenant
with Company to remit to Company or waive any dividends or
distributions paid or payable in respect of such shares.
"Reimbursement Date" has the meaning assigned to that term in
subsection 3.3B.
"Related Agreements" means the Subordinated Note Indentures,
the Subordinated Notes, the other Subordinated Note Documents, the
Acquisition Agreement, the Log Cabin Acquisition Agreement, the Xxxxxx
Xxxxx Acquisition Agreement, the Assumption Agreement, the Log Cabin
Assumption Agreement, the Xxxxxx Xxxxx Assumption Agreement, the MDC
Advisory Agreement, the Dartford Advisory Agreement, the Fenway
Advisory Agreement, the Transition Agreements, the Log Cabin Transition
Agreements, the Red Wing Co-Pack Agreements, the Dartford Expense
Agreement, the Xxxxxxx Co-Pack Agreement and the Xxxxxx Xxxxx
Transition Agreements.
"Release" means any release, spill, emission, leaking,
pumping, pouring, injection, escaping, deposit, disposal, discharge,
dispersal, dumping, leaching or migration of Hazardous Materials into
the indoor or outdoor environment (including, without limitation, the
abandonment or disposal of any barrels, containers or other closed
receptacles containing any Hazardous Materials), or into or out of any
Facility, including the movement of any Hazardous Material through the
air, soil, surface water, groundwater or property.
"Requisite Lenders" means Non-Defaulting Lenders having or
holding not less than 51% of the sum of the aggregate Term Loan
Exposure of all Non-Defaulting Lenders plus the aggregate Revolving
Loan Exposure of all Non-Defaulting Lenders.
"Restricted Junior Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class
of stock of Company now or hereafter outstanding, except a dividend
payable solely in shares of that class of stock to the holders of
that class, (ii) any redemption, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or
indirect, of any shares of any class of stock of Company now or
hereafter outstanding other than stock repurchases for Company's
1998 Employee Stock Purchase Program, (iii) any payment made to
retire, or to obtain the surrender of, any outstanding warrants,
options or other rights to acquire shares of any class of stock of
Company now or hereafter outstanding, and (iv) any payment or
prepayment of principal of, premium, if any, or interest on, or
redemption, purchase, retirement, defeasance (including in-substance
or legal defeasance), sinking fund or similar payment with respect
to, any Subordinated Indebtedness.
"Revolving Loan Commitment" means the commitment of a Lender
to make
29
Revolving Loans to Company pursuant to subsection 2.1A(ii) and
"Revolving Loan Commitments" means such commitments of all Lenders in
the aggregate.
"Revolving Loan Commitment Termination Date" means June 30,
2005 or any earlier date of termination of the Revolving Loan
Commitments pursuant to this Agreement.
"Revolving Loan Exposure" means, with respect to any Lender as
of any date of determination (i) prior to the termination of the
Revolving Loan Commitments, that Lender's Revolving Loan Commitment and
(ii) after the termination of the Revolving Loan Commitments, the sum
of (a) the aggregate outstanding principal amount of the Revolving
Loans of that Lender plus (b) in the event that Lender is an Issuing
Lender, the aggregate Letter of Credit Usage in respect of all Letters
of Credit issued by that Lender (net of any participations purchased by
other Lenders in such Letters of Credit) plus (c) the aggregate amount
of all participations purchased by that Lender in any outstanding
Letters of Credit or any unreimbursed drawings under any Letters of
Credit plus (d) the aggregate amount of all participations purchased by
that Lender in any outstanding Swing Line Loans plus (e) in the case of
Swing Line Lender, the sum of the aggregate outstanding principal
amount of all Swing Line Loans (in each case net of any participations
therein purchased by other Lenders).
"Revolving Loan Pro Rata Share" means with respect to all
payments, computations and other matters relating to the Revolving Loan
Commitment or the Revolving Loans of any Lender or any Letters of
Credit issued by any Lender or any participations purchased by any
Lender therein or in any Swing Line Loans, the percentage obtained by
dividing (i) the Revolving Loan Exposure of that Lender by (ii) the
aggregate Revolving Loan Exposure of all Lenders, in any such case as
the applicable percentage may be adjusted by assignments permitted
pursuant to subsection 10.1.
"Revolving Loans" means the Loans made by Lenders to Company
pursuant to subsection 2.1A(ii).
"Revolving Notes" means (i) the promissory notes of Company
issued pursuant to subsection 2.1E(i)(b) on the Effective Date and (ii)
any promissory notes issued by Company pursuant to the last sentence of
subsection 10.1B(i) in connection with assignments of the Revolving
Loan Commitment and Revolving Loans of any Lender, in each case
substantially in the form of Exhibit V annexed hereto, as they may be
amended, restated, supplemented or otherwise modified from time to
time.
"S&P" means Standard & Poor's Ratings Service, or any
successor thereto.
"Securities" means any stock, shares, partnership interests,
voting trust certificates, certificates of interest or participation in
any profit-sharing agreement or arrangement, options, warrants, bonds,
debentures, notes, or other evidences of indebtedness, secured or
unsecured, convertible, subordinated or otherwise, or in general any
instruments commonly known as "securities" or any certificates of
interest, shares or participations in temporary or interim certificates
for the purchase or acquisition of, or
30
any right to subscribe to, purchase or acquire, any of the foregoing.
"Securities Act" means the Securities Act of 1933, as amended
from time to time, and any successor statute.
"Security Agreement" means the Third Amended and Restated
Security Agreement entered into by and among Company, the Subsidiary
Guarantors and Administrative Agent dated as of the Effective Date and
substantially in the form of Exhibit IX annexed hereto, as such
Security Agreement may be amended, restated, supplemented or otherwise
modified from time to time.
"Seller" means Conopco, Inc., a New York corporation, doing
business as Van den Xxxxx Foods Company.
"Senior Leverage Ratio" means, as of any date of
determination, the ratio of Consolidated Total Senior Debt, as of the
date of determination, to Consolidated EBITDA, for the twelve-month
period ending on the date of determination, in each case calculated for
Company and its Subsidiaries on a consolidated basis in accordance with
GAAP.
"Shared Technology License Agreement" means that certain
Shared Technology License Agreement dated as of December 31, 1996, by
and between Seller and Company, as in effect on the Closing Date and as
such agreement may thereafter be amended, restated, supplemented or
otherwise modified from time to time to the extent permitted under
subsection 7.12A
"Solvent" means, with respect to any Person, that as of the
date of determination both (i) (a) the then fair saleable value of the
property of such Person is (y) greater than the total amount of
liabilities (including contingent liabilities) of such Person and (z)
not less than the amount that will be required to pay the probable
liabilities on such Person's then existing debts as they become
absolute and matured considering all financing alternatives and
potential asset sales reasonably available to such Person; (b) such
Person's capital is not unreasonably small in relation to its business
or any contemplated or undertaken transaction; and (c) such Person does
not intend to incur, or believe (nor should it reasonably believe) that
it will incur, debts beyond its ability to pay such debts as they
become due; and (ii) such Person is "solvent" within the meaning given
that term and similar terms under applicable laws relating to
fraudulent transfers and conveyances. For purposes of this definition,
the amount of any contingent liability at any time shall be computed as
the amount that, in light of all of the facts and circumstances
existing at such time, represents the amount that can reasonably be
expected to become an actual or matured liability.
"Standby Letter of Credit" means any standby letter of credit
or similar instrument issued for the purpose of supporting (i) workers'
compensation liabilities of Company or any of its Subsidiaries, (ii)
the obligations of third party insurers of Company or any of its
31
Subsidiaries arising virtue of the laws of any jurisdiction requiring
third party insurers, (iii) performance, payment, deposit or surety
obligations of Company or any of its Subsidiaries, in any case if
required by law or governmental rule or regulation or in accordance
with custom and practice in the industry, and (iv) such other
obligations of Company and its Subsidiaries as may be reasonably
acceptable to Administrative Agent; provided that Standby Letters of
Credit may not be issued for the purpose of supporting (a) trade
payables or (b) Indebtedness constituting "antecedent debt" (as that
term is used in Section 547 of the Bankruptcy Code).
"Subordinated Note Documents" means collectively the Existing
Subordinated Note Documents, the VDK Subordinated Note Documents and
the New Subordinated Note Documents.
"Subordinated Note Indentures" means collectively the
Existing Subordinated Note Indentures, the VDK Subordinated Note
Indenture and the New Subordinated Note Indenture.
"Subordinated Notes" means collectively the Existing
Subordinated Notes, the VDK Subordinated Notes and the New
Subordinated Notes.
"Subordinated Indebtedness" means (i) the Indebtedness of
Company under the Subordinated Note Documents, (ii) any Indebtedness
permitted under subsection 7.1(vi), (iii) the Indebtedness of Company
evidenced by any Permitted Seller Notes, and (iv) any other
Indebtedness of Company or any of its Subsidiaries subordinated in
right of payment to the Obligations pursuant to documentation
containing maturities, amortization schedules, covenants, defaults,
remedies, subordination provisions and other material terms in form and
substance satisfactory to Administrative Agent and Requisite Lenders.
"Subsidiary" means, with respect to any Person, any
corporation, partnership, association, joint venture or other business
entity of which more than 50% of the total voting power of shares of
stock or other ownership interests entitled (without regard to the
occurrence of any contingency) to vote in the election of the Person or
Persons (whether directors, managers, trustees or other Persons
performing similar functions) having the power to direct or cause the
direction of the management and policies thereof is at the time owned
or controlled, directly or indirectly, by that Person or one or more of
the other Subsidiaries of that Person or a combination thereof.
"Subsidiary Guarantor" means any Subsidiary of Company that
becomes party to the Subsidiary Guaranty at any time after the
Effective Date pursuant to subsection 6.9.
"Subsidiary Guaranty" means the Subsidiary Guaranty,
substantially in the form of Exhibit VII annexed hereto, executed and
delivered by each Subsidiary Guarantor from time to time after the
Effective Date pursuant to subsection 6.9, as such Subsidiary Guaranty
may be amended, restated, supplemented or otherwise modified from time
to time.
"Subsidiary Security Agreements" has the meaning assigned to
that term in subsection 6.9.
32
"Supplemental Collateral Agent" has the meaning assigned to
that term in subsection 9.1B.
"Swing Line Lender" means Chase, or any Person serving as a
successor Administrative Agent hereunder, in its capacity as Swing Line
Lender hereunder.
"Swing Line Loan Commitment" means the commitment of Swing
Line Lender to make Swing Line Loans to Company pursuant to subsection
2.1A(iii).
"Swing Line Loans" means the Loans made by Swing Line Lender
pursuant to subsection 2.1A(iii).
"Swing Line Note" means (i) the promissory note of Company
issued pursuant to subsection 2.1E(ii) on the Effective Date and (ii)
any promissory note issued by Company to any successor Administrative
Agent and Swing Line Lender pursuant to the last sentence of subsection
9.5B, in each case substantially in the form of Exhibit VIII annexed
hereto, as it may be amended, restated, supplemented or otherwise
modified from time to time.
"Syndication Agent" has the meaning assigned to that term in
the introduction to this Agreement.
"Tax" or "Taxes" means any present or future tax, levy,
impost, duty, charge, fee, deduction or withholding of any nature and
whatever called, by whomsoever, on whomsoever and wherever imposed,
levied, collected, withheld or assessed; provided that "Tax on the
overall net income" of a Person shall be construed as a reference to a
tax imposed by the jurisdiction in which that Person's principal office
(and/or, in the case of a Lender, its relevant Lending Office) is
located or in which that Person is deemed to be doing business on all
or part of the net income, profits or gains of that Person (whether
worldwide, or only insofar as such income, profits or gains are
considered to arise in or to relate to a particular jurisdiction, or
otherwise).
"Term Loan Commitment" means the aggregate commitment of a
Lender to make a Tranche A Term Loan to Company pursuant to subsections
2.1A(i), 2.1A(ii) and 2.1A(iii), respectively, and "Term Loan
Commitments" means such commitments of all Lenders in the aggregate.
"Term Loan Exposure" means, with respect to any Lender as of
any date of determination (i) prior to the funding of the Term Loans,
that Lender's Term Loan Commitment and (ii) after the funding of the
Term Loans, the outstanding principal amount of the Term Loan of that
Lender.
"Term Loans" means the Tranche A Term Loans made by Lenders to
Company pursuant to subsection 2.1A(i).
"Term Notes" means one or more of the Tranche A Term Notes.
33
"Tiger" means Gloriande (Luxembourg) SarL, a corporation
organized under the laws of Luxembourg and an affiliate of Tiger Oats.
"Title Company" means one or more title insurance companies
reasonably satisfactory to Administrative Agent.
"Total Utilization of Revolving Loan Commitments" means, as at
any date of determination, the sum of (i) the aggregate principal
amount of all outstanding Revolving Loans (other than Revolving Loans
made for the purpose of repaying any Refunded Swing Line Loans or
reimbursing the applicable Issuing Lender for any amount drawn under
any Letter of Credit but not yet so applied) plus (ii) the aggregate
principal amount of all outstanding Swing Line Loans plus (iii) the
Letter of Credit Usage.
"Tranche A Term Loan Commitment" means the commitment of a
Lender to make a Tranche A Term Loan to Company pursuant to subsection
2.1A(i), and "Tranche A Term Loan Commitments" means such commitments
of all Lenders in the aggregate.
"Tranche A Term Loan Exposure" means, with respect to any
Lender as of any date of determination (i) prior to the funding of the
Tranche A Term Loans, that Lender's Tranche A Term Loan Commitment and
(ii) after the funding of the Tranche A Term Loans, the outstanding
principal amount of the Tranche A Term Loan of that Lender.
"Tranche A Term Loan Pro Rata Share" means with respect to all
payments, computations and other matters relating to the Tranche A Term
Loan Commitment or the Tranche A Term Loan of any Lender, the
percentage obtained by dividing (i) the Tranche A Term Loan Exposure of
that Lender by (ii) the aggregate Tranche A Term Loan Exposure of all
Lenders, in any such case as the applicable percentage may be adjusted
by assignments permitted pursuant to subsection 10.1.
"Tranche A Term Loans" means the Loans made by the Lenders to
the Company pursuant to subsection 2.1A(i).
"Tranche A Term Notes" means (i) the promissory notes of
Company issued pursuant to subsection 2.1E(i)(a) on the Effective Date
and (ii) any promissory notes issued by Company pursuant to the last
sentence of subsection 10.1B(i) in connection with assignments of the
Tranche A Term Loan Commitments or Tranche A Term Loans of any Lenders,
in each case substantially in the form of Exhibit IV annexed hereto, as
they may be amended, restated, supplemented or otherwise modified from
time to time.
"Transaction" has the meaning assigned to that term in the
Recitals to this Agreement.
"Transaction Costs" means the fees, costs and expenses payable
by Company and its Subsidiaries in connection with the Transaction.
"Transition Agreements" means, collectively, (i) that certain
License Agreement
34
dated as of December 31, 1996, by and between Seller and Company, as
in effect on the Closing Date and as such agreement may thereafter
be amended, restated, supplemented or otherwise modified from time
to time to the extent permitted under subsection 7.12A; (ii) the
Shared Technology License Agreement; (iii) the Patent License
Agreement; and (iv) the Quest Agreements.
"UBS" means UBS Capital LLC, a New York limited liability
company.
"UBS AG" means UBS AG, Stamford Branch and its successors,
including, without limitation, any successors by merger.
"Unfunded Current Liability" means, with respect to any
Pension Plan, the amount, if any, by which the actuarial present value
of the accumulated plan benefits under such Pension Plan as of the
close of its most recent plan year exceeds the fair market value of
the assets allocable thereto, each determined in accordance with
Statement of Financial Accounting Standards No. 35, based upon the
actuarial assumptions used by such Pension Plan's actuary in the
most recent annual valuation of such Pension Plan.
"Van xx Xxxx'x" means Van xx Xxxx'x, Inc., a Delaware
corporation.
"Van xx Xxxx'x Patent and Trademark Security Agreement" means
the Van xx Xxxx'x Patent and Trademark Security Agreement entered into
by and among Company, the Subsidiary Guarantors and the Administrative
Agent dated as of the Effective Date, substantially in the form of
Exhibit X annexed hereto, as such Van xx Xxxx'x Patent and Trademark
Security Agreement may thereafter be amended, restated, supplemented or
otherwise modified from time to time.
"VDK Credit Agreement" means the Second Amended and Restated
Credit and Guarantee Agreement, dated as of July 9, 1996, among VDK
Holdings, Van xx Xxxx'x, the banks and other financial institutions
from time to time parties thereto, and Chase, as agent, as the same may
be amended, restated, supplemented or otherwise modified from time to
time.
"VDK Holdings" means VDK Holdings, Inc., a Delaware
corporation.
"VDK Subordinated Note Documents" means the VDK Subordinated
Note Indenture, the VDK Subordinated Notes and each other document
executed in connection with the VDK Subordinated Notes, as each such
document may be amended, restated, supplemented or otherwise modified
from time to time to the extent permitted under subsection 7.12B.
"VDK Subordinated Note Indenture" means the indenture pursuant
to which the VDK Subordinated Notes are issued, in a form delivered to
Agents and Lenders on or prior to the Effective Date, with such changes
thereto as are permitted under subsection 7.12B and as such indenture
may thereafter be amended, restated, supplemented or otherwise modified
from time to time to the extent permitted under subsection 7.12B.
35
"VDK Subordinated Notes" means the 12% Senior Subordinated
Notes of Van xx Xxxx'x due 2005 issued on September 15, 1995 pursuant
to the VDK Subordinated Note Indenture in the form delivered to the
Agents and Lenders on or prior to the Effective Date with such changes
thereto as are permitted under subsection 7.12B and as such notes may
thereafter be amended, restated, supplemented or otherwise modified
from time to time to the extent permitted under Subsection 7.12B.
"Wholly Owned Subsidiary" means, with respect to any Person, a
Subsidiary of such Person all of the outstanding capital stock or other
ownership interests of which (other than Regulatory Shares) shall at
the time be owned by such Person or by one or more Wholly Owned
Subsidiaries of such Person or by such Person and one or more Wholly
Owned Subsidiaries of such Person.
1.2 Accounting Terms Utilization of GAAP for Purposes of
Calculations Under Agreement.
Except as otherwise expressly provided in this Agreement, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP. Financial statements and other information
required to be delivered by Company to Lenders pursuant to clauses (i), (ii),
(iii) and (xiii) of subsection 6.1 shall be prepared in accordance with GAAP
(except, with respect to interim financial statements, normal year end audit
adjustments and the absence of explanatory footnotes) as in effect at the time
of such preparation (and delivered together with the reconciliation statements
provided for in subsection 6.1(v)). Calculations in connection with the
definitions, covenants and other provisions of this Agreement shall utilize
accounting principles and policies in conformity with those used to prepare the
financial statements referred to in subsection 5.3A.
1.3 Other Definitional Provisions.
References to "Sections" and "subsections" shall be to
Sections and subsections, respectively, of this Agreement unless otherwise
specifically provided. Any of the terms defined in subsection 1.1 may, unless
the context otherwise requires, be used in the singular or the plural, depending
on the reference. The words "includes", "including" and similar terms used in
any Loan Document shall be construed as if followed by the words "without
limitation".
SECTION 2.
AMOUNTS AND TERMS OF COMMITMENTS AND LOANS
2.1 Commitments; Loans.
A. Commitments. Subject to the terms and conditions of this
Agreement and in reliance upon the representations and warranties of Loan
Parties set forth herein and in the other Loan Documents, each Lender hereby
severally agrees to make the applicable Loans described in subsections 2.1A(i)
and 2.1A(ii) and Swing Line Lender hereby agrees to make the Swing Line Loans as
described in subsection 2.1A(iii).
36
(i) Tranche A Term Loans. Each Lender with a Tranche
A Term Loan Commitment severally agrees to lend to Company on the Effective
Date an amount not exceeding its Pro Rata Share of the aggregate amount of
the Tranche A Term Loan Commitments to be used for the purposes identified in
subsection 2.5A. The amount of each Lender's Tranche A Term Loan Commitment
is set forth opposite its name on Schedule 2.1 annexed hereto and the
aggregate amount of the Tranche A Term Loan Commitments is $225,000,000;
provided that the Tranche A Term Loan Commitments of Lenders shall be
adjusted to give effect to any assignments of the Tranche A Term Loan
Commitments pursuant to subsection 10.1B. Company may make only one borrowing
under the Tranche A Term Loan Commitments. Amounts borrowed under this
subsection 2.1A(i) and subsequently repaid or prepaid may not be reborrowed.
(ii) Revolving Loans. Each Lender with a Revolving
Loan Commitment severally agrees, subject to the limitations set forth below
with respect to the maximum amount of Revolving Loans permitted to be
outstanding from time to time, to maintain such existing Revolving Loans and
to lend to Company from time to time during the period from the Effective
Date to but excluding the Revolving Loan Commitment Termination Date an
aggregate amount which shall not exceed its Pro Rata Share of the aggregate
amount of the Revolving Loan Commitments, to be used for the purposes
identified in subsection 2.5B. The original amount of each Lender's Revolving
Loan Commitment is set forth opposite its name on Schedule 2.1 annexed hereto
and the aggregate original amount of the Revolving Loan Commitments is
$175,000,000; provided that the Revolving Loan Commitments of Lenders shall
be adjusted to give effect to any assignments of the Revolving Loan
Commitments pursuant to subsection 10.1B; provided further, that the amount
of the Revolving Loan Commitments shall be reduced from time to time by the
amount of any reductions thereto made pursuant to subsection 2.4B. Each
Lender's Revolving Loan Commitment shall expire on the Revolving Loan
Commitment Termination Date and all Revolving Loans and all other amounts
owed hereunder with respect to the Revolving Loans and the Revolving Loan
Commitments shall be paid in full no later than that date. Company may borrow
no more than $15,000,000 under the Revolving Loan Commitments on the
Effective Date. Amounts borrowed under this subsection 2.1A(ii) may be repaid
and reborrowed to but excluding the Revolving Loan Commitment Termination
Date.
Notwithstanding anything contained herein to the contrary,
in no event shall the Total Utilization of Revolving Loan Commitments at any
time exceed the Revolving Loan Commitments then in effect.
(iii) Swing Line Loans. Swing Line Lender hereby agrees,
subject to the limitations set forth below with respect to the maximum
aggregate amount of all Swing Line Loans outstanding from time to time, to
make a portion of the Revolving Loan Commitments available to Company from
time to time during the period from the Effective Date to but excluding the
Revolving Loan Commitment Termination Date by making Base Rate Loans as Swing
Line Loans to Company in an aggregate amount not to exceed the amount of the
Swing Line Loan Commitment, to be used for the purposes identified in
subsection 2.5B, notwithstanding the fact that such Swing Line Loans, when
aggregated with the sum of Swing Line Lender's outstanding Revolving Loans
and Swing Line Lender's Pro Rata Share of the Letter of Credit Usage then in
effect, may exceed Swing Line Lender's Revolving Loan
37
Commitment. The original amount of the Swing Line Loan Commitment is
$10,000,000; provided that the amounts of the Swing Line Loan Commitment are
subject to reduction as provided in clause (b) of the next paragraph. The
Swing Line Loan Commitment shall expire on the Revolving Loan Commitment
Termination Date and all Swing Line Loans and all other amounts owed
hereunder with respect to the Swing Line Loans shall be paid in full no later
than that date. Amounts borrowed under this subsection 2.1A(iii) may be
repaid and reborrowed to but excluding the Revolving Loan Commitment
Termination Date.
Notwithstanding anything contained herein to the contrary,
the Swing Line Loans, and the Swing Line Loan Commitment shall be subject to
the following limitations in the amounts indicated:
(a) in no event shall the Total Utilization of Revolving Loan
Commitments at any time exceed the Revolving Loan Commitments then in
effect;
(b) any reduction of the Revolving Loan Commitments made
pursuant to subsection 2.4B which reduces the aggregate Revolving Loan
Commitments to an amount less than the then current sum of the Swing
Line Loan Commitment shall result in an automatic corresponding pro
rata reduction of the Swing Line Loan Commitment such that the sum
thereof equals the amount of the Revolving Loan Commitments, as so
reduced, without any further action on the part of Company,
Administrative Agent or Swing Line Lender.
With respect to any Swing Line Loans which have not been
voluntarily prepaid by Company pursuant to subsection 2.4B(i), Swing Line Lender
may, at any time in its sole and absolute discretion, deliver to Administrative
Agent (with a copy to Company), no later than 12:00 Noon (New York time) at
least one Business Day in advance of the proposed Funding Date, a notice (which
shall be deemed to be a Notice of Borrowing given by Company) requesting Lenders
to make Revolving Loans that are Base Rate Loans to Company on such Funding Date
in an amount equal to the amount of such Swing Line Loans (the "Refunded Swing
Line Loans") outstanding on the date such notice is given which Swing Line
Lender requests Lenders to prepay. Anything contained in this Agreement to the
contrary notwithstanding, (i) the proceeds of such Revolving Loans made by
Lenders other than Swing Line Lender shall be immediately delivered by
Administrative Agent to Swing Line Lender (and not to Company) and applied to
repay a corresponding portion of the Refunded Swing Line Loans and (ii) on the
day such Revolving Loans are made, Swing Line Lender's Pro Rata Share of the
Refunded Swing Line Loans shall be deemed to be paid with the proceeds of a
Revolving Loan made by Swing Line Lender to Company, and such portion of the
Swing Line Loans deemed to be so paid, shall no longer be outstanding as Swing
Line Loans and shall no longer be due under the Swing Line Note of Swing Line
Lender but shall instead constitute part of Swing Line Lender's outstanding
Revolving Loans to Company and shall be due under the Revolving Note issued by
Company to Swing Line Lender. Company hereby authorizes each of Administrative
Agent and Swing Line Lender to charge Company's accounts with Administrative
Agent and Swing Line Lender (up to the amount available in each such account) in
order to immediately pay Swing Line Lender the amount of the Refunded Swing Line
Loans to the extent the proceeds of such Revolving Loans made by Lenders,
including the Revolving Loan deemed to be made by Swing Line Lender, are not
sufficient to repay in full the Refunded Swing Line Loans. If any portion of any
such amount
38
paid (or deemed to be paid) to Swing Line Lender should be recovered by or on
behalf of Company from Swing Line Lender in bankruptcy, by assignment for the
benefit of creditors or otherwise, the loss of the amount so recovered shall
be ratably shared among all Lenders in the manner contemplated by subsection
10.5.
If for any reason Revolving Loans are not made pursuant to
this subsection 2.1A(iii) in an amount sufficient to repay any amounts owed
to Swing Line Lender in respect of any outstanding Swing Line Loans on or
before the third Business Day after demand for payment thereof by Swing Line
Lender, each Lender with a Revolving Loan Commitment shall be deemed to, and
hereby agrees to, have purchased a participation in such outstanding Swing
Line Loans, and in an amount equal to its Pro Rata Share of the applicable
unpaid amount together with accrued interest thereon. Upon one Business Day's
notice from Swing Line Lender, each such Lender shall deliver to Swing Line
Lender an amount equal to its respective participation in the applicable
unpaid amount in same day funds at the Funding and Payment Office. In order
to evidence such participation each such Lender agrees to enter into a
participation agreement at the request of Swing Line Lender in form and
substance satisfactory to Swing Line Lender. In the event any such Lender
fails to make available to Swing Line Lender the amount of such Lender's
participation as provided in this paragraph, Swing Line Lender shall be
entitled to recover such amount on demand from such Lender together with
interest thereon at the rate customarily used by Swing Line Lender for the
correction of errors among banks for three Business Days and thereafter at
the Base Rate, as applicable.
Notwithstanding anything contained herein to the contrary,
(i) the obligation of each Lender with a Revolving Loan Commitment to make
Revolving Loans for the purpose of repaying any Refunded Swing Line Loans
pursuant to the second preceding paragraph and each such Lender's obligation
to purchase a participation in any unpaid Swing Line Loans pursuant to the
immediately preceding paragraph shall be absolute and unconditional and shall
not be affected by any circumstance, including, without limitation, (a) any
set-off, counterclaim, recoupment, defense or other right which such Lender
may have against Swing Line Lender, Company or any other Person for any
reason whatsoever; (b) the occurrence or continuation of an Event of Default
or a Potential Event of Default; (c) any adverse change in the business,
operations, properties, assets, condition (financial or otherwise) or
prospects of Company or any of its Subsidiaries; (d) any breach of this
Agreement or any other Loan Document by any party thereto; or (e) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing; provided that no such Lender shall have any such obligation
unless (x) Swing Line Lender believed in good faith that all conditions under
Section 4 to the making of the applicable Refunded Swing Line Loans or other
unpaid Swing Line Loans, were satisfied at the time such Refunded Swing Line
Loans or unpaid Swing Line Loans were made, or (y) such Lender had actual
knowledge, by receipt of any notices required to be delivered to such Lenders
pursuant to subsection 6.1(ix) or otherwise, that any such condition under
Section 4 had not been satisfied and such Lender failed to notify Swing Line
Lender and Administrative Agent in writing that it had no obligation to make
Revolving Loans until such condition was satisfied (any such notice to be
effective as of the date of receipt thereof by Swing Line Lender and
Administrative Agent), or (z) the satisfaction of any such condition under
Section 4 not satisfied had been waived by Requisite Lenders prior to or at
the time such Refunded Swing Line Loans or other unpaid Swing Line Loans were
made; and (ii) Swing Line Lender shall not be obligated to make any Swing
Line Loans if it has elected not to do so after the occurrence and during the
39
continuation of a Potential Event of Default or Event of Default.
B. Borrowing Mechanics. Term Loans or Revolving Loans
(including any such Loans made as Eurodollar Rate Loans with a particular
Interest Period) made on any Funding Date (other than Revolving Loans made
pursuant to a request by Swing Line Lender pursuant to subsection 2.1A(iii)
for the purpose of repaying any Refunded Swing Line Loans or Revolving Loans
made pursuant to subsection 3.3B for the purpose of reimbursing any Issuing
Lender for the amount of a drawing or payment under a Letter of Credit issued
by it) shall be in an aggregate minimum amount of $500,000 and integral
multiples of $250,000 in excess of that amount. Swing Line Loans made on any
Funding Date shall be in an aggregate minimum amount of $250,000 and integral
multiples of $100,000 in excess of that amount. Whenever Company desires that
Lenders make Term Loans or Revolving Loans it shall deliver to Administrative
Agent on behalf of Company a Notice of Borrowing no later than 12:00 Noon
(New York time), at least three Business Days in advance of the proposed
Funding Date in the case of a Eurodollar Rate Loan, or at least one Business
Day in advance of the proposed Funding Date in the case of a Base Rate Loan.
Whenever Company desires that Swing Line Lender make a Swing Line Loan, it
shall deliver to Administrative Agent a Notice of Borrowing no later than
12:00 Noon (New York time) on the proposed Funding Date. The Notice of
Borrowing shall specify (i) the proposed Funding Date (which shall be a
Business Day), (ii) the amount and type of Loans requested, (iii) in the case
of Swing Line Loans, that such Loans shall be Base Rate Loans, (iv) in the
case of any Loans other than Swing Line Loans, whether such Loans shall be
Base Rate Loans or Eurodollar Rate Loans, and (v) in the case of any Loans
requested to be made as Eurodollar Rate Loans, the initial Interest Period
requested therefor. Term Loans and Revolving Loans may be continued as or
converted into Base Rate Loans and Eurodollar Rate Loans in the manner
provided in subsection 2.2D. In lieu of delivering the above-described Notice
of Borrowing, Company may give Administrative Agent telephonic notice by the
required time of any proposed borrowing under this subsection 2.1B; provided
that such notice shall be promptly confirmed in writing by delivery of a
Notice of Borrowing to Administrative Agent on or before the applicable
Funding Date.
Neither Administrative Agent nor any Lender shall incur any
liability to Company in acting upon any telephonic notice referred to above
that Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to borrow on behalf of Company
or for otherwise acting in good faith under this subsection 2.1B, and upon
funding of Loans by Lenders in accordance with this Agreement pursuant to any
such telephonic notice Company shall have effected Loans hereunder.
Company shall notify Administrative Agent prior to the
funding of any Loans in the event that any of the matters to which Company is
required to certify in the applicable Notice of Borrowing are no longer true
and correct as of the applicable Funding Date, and the acceptance by Company
of the proceeds of any Loans shall constitute a re-certification by Company,
as of the applicable Funding Date, as to the matters to which Company is
required to certify in the applicable Notice of Borrowing.
Except as otherwise provided in subsections 2.6B, 2.6C and
2.6G, a Notice of Borrowing for a Eurodollar Rate Loan (or telephonic notice
in lieu thereof) shall be irrevocable on and after the related Interest Rate
Determination Date, and Company shall be bound to make a
40
borrowing in accordance therewith.
C. Disbursement of Funds. All Term Loans and all Revolving
Loans under this Agreement shall be made by Lenders simultaneously and
proportionately to their respective Pro Rata Shares, it being understood that
no Lender shall be responsible for any default by any other Lender in that
other Lender's obligation to make a Loan requested hereunder nor shall the
Commitment of any Lender to make the particular type of Loan requested be
increased or decreased as a result of a default by any other Lender in that
other Lender's obligation to make a Loan requested hereunder. Promptly after
receipt by Administrative Agent of a Notice of Borrowing pursuant to
subsection 2.1B (or telephonic notice in lieu thereof), Administrative Agent
shall notify each Lender or Swing Line Lender, as the case may be, of the
proposed borrowing and of the amount of such Lender's Pro Rata Share of the
applicable Loans.
Each Lender shall make the amount of its Loan available to
Administrative Agent not later than 12:00 Noon (New York time) on the
applicable Funding Date, and Swing Line Lender shall make the amount of its
Swing Line Loan available to Administrative Agent not later than 12:00 Noon
(New York time) on the applicable Funding Date, in each case in same day
funds, at the Funding and Payment Office. Except as provided in subsection
2.1A(iii) or subsection 3.3B with respect to Revolving Loans used to repay
Refunded Swing Line Loans or to reimburse any Issuing Lender for the amount
of an honored drawing or payment under a Letter of Credit issued by it, upon
satisfaction or waiver of the conditions precedent specified in subsections
4.1 (in the case of Loans made on the Effective Date) and 4.2 (in the case of
all Loans), Administrative Agent shall make the proceeds of such Loans
available to Company on the applicable Funding Date by causing an amount of
same day funds equal to the proceeds of all such Loans received by
Administrative Agent from Lenders or Swing Line Lender, as the case may be,
to be credited to the account of Company at the Funding and Payment Office.
Unless Administrative Agent shall have been notified by any
Lender prior to the Funding Date for any Loans that such Lender does not
intend to make available to Administrative Agent the amount of such Lender's
Loan requested on such Funding Date, Administrative Agent may assume that
such Lender has made such amount available to Administrative Agent on such
Funding Date and Administrative Agent may, in its sole discretion, but shall
not be obligated to, make available to Company a corresponding amount on such
Funding Date. If such corresponding amount is not in fact made available to
Administrative Agent by such Lender, Administrative Agent shall be entitled
to recover such corresponding amount on demand from such Lender together with
interest thereon, for each day from such Funding Date until the date such
amount is paid to Administrative Agent, at the customary rate set by
Administrative Agent for the correction of errors among banks for three
Business Days and thereafter at the Base Rate. If such Lender does not pay
such corresponding amount forthwith upon Administrative Agent's demand
therefor, Administrative Agent shall promptly notify Company and Company
shall immediately pay such corresponding amount to Administrative Agent
together with interest thereon, for each day from such Funding Date until the
date such amount is paid to Administrative Agent, at the rate applicable to
such Loan. Nothing in this subsection 2.1C shall be deemed to relieve any
Lender from its obligation to fulfill its Commitments hereunder or to
prejudice any rights that Company may have against any Lender as a result of
any default by such Lender hereunder.
D. The Register.
(i) Administrative Agent shall maintain, at the address
referred to in subsection 10.8, a register for the recordation of the
names and addresses of Lenders and the Commitments and Loans of each
Lender from time to time (the "Register"). The Register shall be
available for inspection by Company or any Lender at any reasonable
time and from time to time upon reasonable prior notice.
(ii) Administrative Agent shall record in the Register the
Commitments and the outstanding Loans from time to time of each Lender
and each repayment or prepayment in respect of the principal amount of
the outstanding Loans of each Lender. Any such recordation shall be
conclusive and binding on Company and each Lender, absent manifest
error; provided, that failure to make any such recordation, or any
error in such recordation, shall not affect Company's Obligations in
respect of the applicable Loans.
(iii) Each Lender shall record on its internal records
(including, without limitation, the Notes held by such Lender) the
amount of each Loan made by it and each payment in respect thereof. Any
such recordation shall be prima facie evidence of the amount of such
Loans; provided that failure to make any such recordation, or any error
in such recordation, shall not affect Company's Obligations in respect
of the applicable Loans; and provided, further that in the event of any
inconsistency between the Register and any Lender's records, the
recordations in the Register shall govern, absent manifest error.
(iv) Company, Agents and Lenders shall deem and treat the
Persons listed as Lenders in the Register as the holders and owners of
the corresponding Commitments and Loans listed therein for all purposes
hereof, and no assignment or transfer of any Commitment or Loan shall
be effective, in each case unless an until an Assignment Agreement
effecting the assignment or transfer thereof shall have been accepted
by Administrative Agent and recorded in the Register as provided in
subsection 10.1B(ii). Prior to such recordation, all amounts owed with
respect to the applicable Commitment or Loan shall be owed to the
Lender listed in the Register as the owner thereof, and any request,
authority or consent of any Person who, at the time of making such
request or giving such authority or consent, is listed in the Register
as a Lender shall be conclusive and binding on any subsequent holder,
assignee or transferee of the corresponding Commitments or Loans.
(v) Company hereby designates Chase, and any financial
institution serving as a successor Administrative Agent, to serve as
Company's agent solely for purposes of maintaining the Register as
provided in this subsection 2.1D, and Company hereby agrees that, to
the extent Chase serves in such capacity, Chase and its officers,
directors, employees, agents and affiliates shall constitute
Indemnities for all purposes under subsection 10.3.
E. Notes. Company shall execute and deliver on the Effective
Date (i) to
42
each requesting Lender (or to Administrative Agent for that Lender)
(a) a Tranche A Term Note substantially in the form of Exhibit IV annexed
hereto, to evidence that Lender's Tranche A Term Loans in the principal amount
of that Lender's Tranche A Term Loans and with other appropriate insertions and
(b) a Revolving Note substantially in the form of Exhibit V annexed hereto to
evidence that Lender's Revolving Loans, in the principal amount of that Lender's
Revolving Loan Commitment and with other appropriate insertions, and (ii) to
Swing Line Lender, a Swing Line Note substantially in the form of Exhibit VI
annexed hereto to evidence Swing Line Lender's Swing Line Loans, in the
principal amount of the Swing Line Commitment and with other appropriate
insertions. The Notes and the Obligations evidenced thereby shall be governed
by, subject to and benefit from all of the terms and conditions of this
Agreement and the other Loan Documents and shall be guarantied and/or secured by
the Collateral as provided in the Loan Documents.
2.2 Interest on the Loans.
A. Rate of Interest. Subject to the provisions of subsections
2.6 and 2.7, each Term Loan and each Revolving Loan shall bear interest on the
unpaid principal amount thereof from the date made through maturity (whether by
acceleration or otherwise) at a rate determined by reference to the Base Rate or
the Adjusted Eurodollar Rate, as the case may be, plus the Applicable Margin.
Subject to the provisions of subsection 2.7, each Swing Line Loan shall bear
interest on the unpaid principal amount thereof from the date made through
maturity (whether by acceleration or otherwise) at a rate determined by
reference to the Base Rate, plus the Applicable Margin. The applicable basis for
determining the rate of interest with respect to any Loan shall be selected by
Company initially at the time a Notice of Borrowing is given with respect to
such Loan pursuant to subsection 2.1B. The basis for determining the interest
rate with respect to any Term Loan or any Revolving Loan may be changed from
time to time pursuant to subsection 2.2D. If on any day any Term Loan or
Revolving Loan is outstanding with respect to which notice has not been
delivered to Administrative Agent in accordance with the terms of this Agreement
specifying the applicable basis for determining the rate of interest, then for
that day that Loan shall bear interest determined by reference to the Base Rate,
plus the Applicable Margin for Base Rate Loans.
Subject to the provisions of subsections 2.2E and 2.7, the
Term Loans and the Revolving Loans shall bear interest through maturity as
follows:
(i) if a Base Rate Loan, then at the sum of the Base Rate
plus the Applicable Margin for Base Rate Loans; or
(ii) if a Eurodollar Rate Loan, then at the sum of the
Adjusted Eurodollar Rate plus the Applicable Margin for Eurodollar
Loans.
Subject to the provisions of subsections 2.2E and 2.7, the
Swing Line Loans shall bear interest through maturity at the sum of the Base
Rate plus the Applicable Margin with respect to Base Rate Revolving Loans.
B. Interest Periods. In connection with each Eurodollar Rate
Loan, Company may, pursuant to the applicable Notice of Borrowing or Notice of
Conversion/Continuation, as
43
the case may be, select an interest period (each an "Interest Period") to be
applicable to such Loan, which Interest Period shall be, at Company's option,
either a one-, two-, three- or six-month period; provided that:
(i) the initial Interest Period for any Eurodollar Rate
Loan shall commence on the Funding Date in respect of such Loan, in the
case of a Loan initially made as a Eurodollar Rate Loan, or on the date
specified in the applicable Notice of Conversion/Continuation, in the
case of a Loan converted to a Eurodollar Rate Loan;
(ii) in the case of immediately successive Interest Periods
applicable to a Eurodollar Rate Loan continued as such pursuant to a
Notice of Conversion/ Continuation, each successive Interest Period
shall commence on the day on which the next preceding Interest Period
expires;
(iii) if an Interest Period would otherwise expire on a day
that is not a Business Day, such Interest Period shall expire on the
next succeeding Business Day; provided that, if any Interest Period
would otherwise expire on a day that is not a Business Day but is a day
of the month after which no further Business Day occurs in such month,
such Interest Period shall expire on the next preceding Business Day;
(iv) any Interest Period that begins on the last Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall, subject to clause (iii) of this subsection 2.2B, end on
the last Business Day of a calendar month;
(v) no Interest Period with respect to any portion of the
Tranche A Term Loans shall extend beyond June 30, 2005 and no Interest
Period with respect to any portion of the Revolving Loans shall extend
beyond the Revolving Loan Commitment Termination Date;
(vi) no Interest Period with respect to any portion of the
Term Loans shall extend beyond a date on which Company is required to
make a scheduled payment of principal of such Term Loans unless the sum
of (a) the aggregate principal amount of such Term Loans that are Base
Rate Loans plus (b) the aggregate principal amount of such Term Loans
that are Eurodollar Rate Loans with Interest Periods expiring on or
before such date equals or exceeds the principal amount required to be
paid on the Term Loans on such date;
(vii) no Interest Period with respect to any portion of the
Revolving Loans shall extend beyond the date on which a permanent
reduction of the Revolving Loan Commitments is scheduled to occur
unless the sum of (a) the aggregate principal amount of Revolving Loans
that are Base Rate Loans plus (b) the aggregate principal amount of
Revolving Loans that are Eurodollar Rate Loans with Interest Periods
expiring on or before such date plus (c) the excess of the Revolving
Loan Commitments then in effect over the aggregate principal amount of
Revolving Loans then outstanding equals or exceeds the permanent
reduction of the Revolving Loan Commitments that is scheduled to occur
on such date;
44
(viii) there shall be no more than ten (10) Interest Periods
outstanding at any time; and
(ix) in the event Company fails to specify an Interest
Period for any Eurodollar Rate Loan in the applicable Notice of
Borrowing or Notice of Conversion/Continuation, Company shall be deemed
to have selected an Interest Period of one month.
C. Interest Payments. Subject to the provisions of subsection
2.2E, interest on each Loan shall be payable in arrears on and to each Interest
Payment Date applicable to that Loan, upon any prepayment of that Loan (to the
extent accrued on the amount being prepaid) and at maturity (including final
maturity); provided that in the event that any Swing Line Loans, any Revolving
Loans or any Term Loans that are Base Rate Loans are prepaid pursuant to
subsection 2.4B(i), interest accrued on such Swing Line Loans, Revolving Loans
or Term Loans through the date of such prepayment shall be payable on the next
succeeding Interest Payment Date applicable to Base Rate Loans (or, if earlier,
at final maturity).
D. Conversion or Continuation. Subject to the provisions of
subsection 2.6, Company shall have the option (i) to convert at any time all or
any part of its outstanding Term Loans or Revolving Loans equal to $500,000 and
integral multiples of $250,000 in excess of that amount from Loans bearing
interest at a rate determined by reference to one basis to Loans bearing
interest at a rate determined by reference to an alternative basis or (ii) upon
the expiration of any Interest Period applicable to a Eurodollar Rate Loan, to
continue all or any portion of such Loan equal to $500,000 and integral
multiples of $250,000 in excess of that amount as a Eurodollar Rate Loan;
provided, however, that a Eurodollar Rate Loan may only be converted into a Base
Rate Loan on the expiration date of an Interest Period applicable thereto.
Company shall deliver a Notice of Conversion/Continuation to
Administrative Agent no later than 12:00 Noon (New York time) at least one
Business Day in advance of the proposed conversion date (in the case of a
conversion to a Base Rate Loan), and at least three Business Days in advance of
the proposed conversion/continuation date (in the case of a conversion to, or a
continuation of, a Eurodollar Rate Loan). A Notice of Conversion/Continuation
shall specify (i) the proposed conversion/continuation date (which shall be a
Business Day), (ii) the amount and type of the Loan to be converted/continued,
(iii) the nature of the proposed conversion/continuation, (iv) in the case of a
conversion to, or a continuation of, a Eurodollar Rate Loan, the requested
Interest Period, and (v) in the case of a conversion to, or a continuation of, a
Eurodollar Rate Loan, that no Potential Event of Default or Event of Default has
occurred and is continuing. In lieu of delivering the above-described Notice of
Conversion/Continuation, Company may give Administrative Agent telephonic notice
by the required time of any proposed conversion/continuation under this
subsection 2.2D; provided that such notice shall be promptly confirmed in
writing by delivery of a Notice of Conversion/Continuation to Administrative
Agent on or before the proposed conversion/continuation date.
Neither Administrative Agent nor any Lender shall incur any
liability to Company in acting upon any telephonic notice referred to above that
Administrative Agent believes in
45
good faith to have been given by a duly authorized officer or other person
authorized to act on behalf of Company or for otherwise acting in good faith
under this subsection 2.2D, and upon conversion or continuation of the
applicable basis for determining the interest rate with respect to any Loans
in accordance with this Agreement pursuant to any such telephonic notice
Company shall have effected a conversion or continuation, as the case may be,
hereunder.
Except as otherwise provided in subsections 2.6B, 2.6C and
2.6G, a Notice of Conversion/Continuation for conversion to, or continuation of,
a Eurodollar Rate Loan (or telephonic notice in lieu thereof) shall be
irrevocable on and after the related Interest Rate Determination Date, and
Company shall be bound to effect a conversion or continuation in accordance
therewith.
E. Post-Default Interest. Upon the occurrence and during the
continuation of any Event of Default, the outstanding principal amount of all
Loans and, to the extent permitted by applicable law, any interest payments
thereon not paid when due and any fees and other amounts then due and payable
hereunder, shall thereafter bear interest (including post-petition interest in
any proceeding under the Bankruptcy Code, or other applicable bankruptcy or
insolvency laws) payable upon demand at a rate that is 2% per annum in excess of
the interest rate otherwise payable under this Agreement with respect to the
applicable Loans (or, in the case of any such fees and other amounts, at a rate
which is 2% per annum in excess of the interest rate otherwise payable under
this Agreement for Revolving Loans bearing interest at a rate determined by
reference to the Base Rate); provided that, in the case of Eurodollar Rate
Loans, upon the expiration of the Interest Period in effect at the time any such
increase in interest rate is effective such Eurodollar Rate Loans shall
thereupon become Base Rate Loans and shall thereafter bear interest payable upon
demand at a rate equal to 2% per annum in excess of the interest rate otherwise
payable under this Agreement for Base Rate Loans that are Term Loans or
Revolving Loans, as applicable. Payment or acceptance of the increased rates of
interest provided for in this subsection 2.2E is not a permitted alternative to
timely payment and shall not constitute a waiver of any Event of Default or
otherwise prejudice or limit any rights or remedies of any Agent or Lender.
F. Computation of Interest. Interest on Loans shall be
computed on the basis of a 360-day year and for the actual number of days
elapsed in the period during which it accrues. In computing interest on any
Loan, the date of the making of such Loan or the first day of an Interest Period
applicable to such Loan or, with respect to a Base Rate Loan being converted
from a Eurodollar Rate Loan, the date of conversion of such Eurodollar Rate Loan
to such Base Rate Loan, as the case may be, shall be included, and the date of
payment of such Loan or the expiration date of an Interest Period applicable to
such Loan or, with respect to a Base Rate Loan being converted to a Eurodollar
Rate Loan, the date of conversion of such Base Rate Loan to such Eurodollar Rate
Loan, as the case may be, shall be excluded; provided that if a Loan is repaid
on the same day on which it is made, one day's interest shall be paid on that
Loan.
46
2.3 Fees.
A. Commitment Fees. Company agrees to pay to Administrative
Agent, for distribution to each Lender having a Revolving Loan Commitment, in
proportion to that Lender's Pro Rata Share of the Revolving Loan Commitments,
commitment fees ("Commitment Fees"; each, a "Commitment Fee") for the period
from and including the Effective Date to and excluding the Revolving Loan
Commitment Termination Date equal to (i) the average of the daily excess of the
Revolving Loan Commitments over the sum of (x) the aggregate principal amount of
Revolving Loans outstanding (but not any Swing Line Loans outstanding), and (y)
the Letter of Credit Usage multiplied by (ii) the Applicable Margin for
Commitment Fees. All such Commitment Fees shall be calculated on the basis of a
360-day year and the actual number of days elapsed and shall be payable
quarterly in arrears on March 31, June 30, September 30 and December 31 of each
year, commencing on September 30, 1998, and on the Revolving Loan Commitment
Termination Date.
B. Other Fees. Company agrees to pay to Agents such
other fees in the amounts and at the times separately agreed upon between
Company and the applicable Agents.
2.4 Repayments, Prepayments and Reductions in Revolving Loan
Commitments; General Provisions Regarding Payments;
Application of Proceeds of Collateral and Payments under
Guaranties.
--------------------------------------------------------
A. Scheduled Payments of Term Loans and
Scheduled Reductions of Revolving Loan
Commitments.
------------
------------
(i) Scheduled Payments of Term Loans. Company shall make principal
payments on the Term Loans in installments on the dates and in the amounts set
forth below:
--------------------------------------------------------------------------------------------------
SCHEDULED REPAYMENT
DATE OF TERM LOANS
--------------------------------------------------------------------------------------------------
December 31, 1998 $5,000,000
--------------------------------------------------------------------------------------------------
March 31, 1999 $5,000,000
June 30, 1999 $5,000,000
September 30, 1999 $5,000,000
December 31, 1999 $5,000,000
--------------------------------------------------------------------------------------------------
March 31, 2000 $5,000,000
June 30, 2000 $5,000,000
September 30, 2000 $7,500,000
December 31, 2000 $7,500,000
--------------------------------------------------------------------------------------------------
March 31, 2001 $7,500,000
June 30, 2001 $7,500,000
47
--------------------------------------------------------------------------------------------------
SCHEDULED REPAYMENT
DATE OF TERM LOANS
--------------------------------------------------------------------------------------------------
September 30, 2001 $7,500,000
December 31, 2001 $7,500,000
--------------------------------------------------------------------------------------------------
March 31, 2002 $7,500,000
June 30, 2002 $7,500,000
September 30, 2002 $10,000,000
December 31, 2002 $10,000,000
--------------------------------------------------------------------------------------------------
March 31, 2003 $10,000,000
June 30, 2003 $10,000,000
September 30, 2003 $10,000,000
December 31, 2003 $10,000,000
--------------------------------------------------------------------------------------------------
March 31, 2004 $10,000,000
June 30, 2004 $10,000,000
September 30, 2004 $12,500,000
December 31, 2004 $12,500,000
--------------------------------------------------------------------------------------------------
March 31, 2005 $12,500,000
June 30, 2005 $12,500,000
==================================================================================================
provided that the scheduled installments of principal of the Term Loans set
forth above shall be reduced in connection with any voluntary or mandatory
prepayments of the Term Loans in accordance with subsection 2.4C; and provided
further, that the final installment payable by Company in respect of the Term
Loans shall be in an amount, if such amount is different from that specified
above, sufficient to repay all amounts owing by Company under this Agreement
with respect to the Term Loans.
(ii) Scheduled Reductions of Revolving Loan Commitments. Except as
set forth in the following proviso, the Revolving Loan Commitments shall be
permanently reduced on the date and in the amount set forth below:
--------------------------------------------------------------------------------------------------
SCHEDULED REDUCTION
DATE OF REVOLVING LOAN
COMMITMENTS
--------------------------------------------------------------------------------------------------
June 30, 2005 $175,000,000
--------------------------------------------------------------------------------------------------
; and provided further, that the scheduled reductions of the Revolving Loan
Commitments set forth above shall be reduced in connection with any voluntary or
mandatory reductions of the Revolving Loan Commitments in accordance with
subsection 2.4C.
B. Prepayments and Voluntary Reductions in
Revolving Loan Commitments.
---------------------------------------
48
(i) Voluntary Prepayments. Company may, upon written or telephonic
notice to Administrative Agent on or prior to 12:00 Noon (New York time) on the
date of prepayment, which notice, if telephonic, shall be promptly confirmed in
writing, at any time and from time to time prepay, without premium or penalty,
any Swing Line Loan on any Business Day in whole or in part in an aggregate
minimum amount of $250,000 and integral multiples of $100,000 in excess of that
amount. In addition, so long as no Swing Line Loans are then outstanding,
Company may, upon not less than one Business Day's prior written or telephonic
notice, in the case of Base Rate Loans, and three Business Days' prior written
or telephonic notice, in the case of Eurodollar Rate Loans, in each case
confirmed in writing to Administrative Agent (which notice Administrative Agent
will promptly transmit by telefacsimile or telephone to each Lender), at any
time and from time to time prepay, without premium or penalty, the Loans other
than Swing Line Loans on any Business Day in whole or in part in an aggregate
minimum amount of $500,000 and integral multiples of $250,000 in excess of that
amount; provided, however, that prepayment of a Eurodollar Rate Loan on any
day other than the expiration of the Interest Period applicable thereto shall
be subject to compliance with subsection 2.6D. Notice of prepayment having been
given as aforesaid, the Loans shall become due and payable on the prepayment
date specified in such notice and in the aggregate principal amount specified
therein. Any voluntary prepayments pursuant to this subsection 2.4B(i) shall be
applied as specified in subsection 2.4C.
(ii) Voluntary Reductions of Revolving Loan Commitments. Company
may, upon not less than three Business Days' prior written or telephonic notice
confirmed in writing to Administrative Agent (which notice Administrative Agent
will promptly transmit by telefacsimile or telephone to each Lender), at any
time and from time to time terminate in whole or permanently reduce in part,
without premium or penalty, the Revolving Loan Commitments in an amount up to
the amount by which the Revolving Loan Commitments exceed the Total Utilization
of Revolving Loan Commitments at the time of such proposed termination or
reduction; provided that any such partial reduction of the Revolving Loan
Commitments shall be in an aggregate minimum amount of $500,000 and integral
multiples of $250,000 in excess of that amount. Company's notice to
Administrative Agent shall designate the date (which shall be a Business Day) of
such termination or reduction and the amount of any partial reduction, and such
termination or reduction of the Revolving Loan Commitments shall be effective on
the date specified in such notice and shall reduce the Revolving Loan Commitment
of each Lender proportionately to its Pro Rata Share. Any such voluntary
reduction of the Revolving Loan Commitments shall be applied as specified in
subsection 2.4C.
(iii) Mandatory Prepayments and Mandatory Reductions of Revolving
Loan Commitments.
The Loans shall be prepaid and the Revolving Loan Commitments
shall be reduced in the manner provided in subsection 2.4C upon the occurrence
of the following circumstances:
(a) Prepayments and Reductions from Asset Sales. No later than
the second Business Day following the date of receipt by Company or any
of its Subsidiaries of the Net Cash Proceeds of any Asset Sale (other
than any portion of such Net Cash Proceeds that is reinvested (or
scheduled for reinvestment) in assets of the general type used in the
49
business of Company and its Subsidiaries within 360 days from the date
of receipt of such Net Cash Proceeds (such Net Cash Proceeds that are
reinvested or to be reinvested not to exceed $55,000,000 in aggregate
amount in any Fiscal Year)), Company shall prepay the Loans (and/or the
Revolving Loan Commitments shall be reduced) in an aggregate amount
equal to such Net Cash Proceeds; provided, however, that Company may
not reinvest (or schedule for reinvestment) Net Cash Proceeds upon the
occurrence and during the continuation of an Event of Default. Company
shall, no later than 360 days after receipt of any such Net Cash
Proceeds that have not theretofore been applied to the Obligations,
make an additional prepayment of the Loans (and/or the Revolving Loan
Commitments shall be reduced) in the full amount of all such proceeds
that have not therefore been so reinvested. Concurrently with any
prepayment of the Loans and/or reduction of the Commitments pursuant
to this subsection 2.4B(iii)(a), Company shall deliver to
Administrative Agent an Officer's Certificate demonstrating the
derivation of the Net Cash Proceeds of the correlative Asset Sale from
the gross sales price thereof. In the event that Company shall, at any
time after receipt of Net Cash Proceeds of any Asset Sale requiring a
prepayment or a reduction of the Revolving Loan Commitments pursuant
to this subsection 2.4B(iii)(a), determine that the prepayments and/or
reductions of the Revolving Loan Commitments previously made in
respect of such Asset Sale were in an aggregate amount less than that
required by the terms of this subsection 2.4B(iii)(a), Company shall
promptly cause to be made an additional prepayment of the Loans
(and/or reduction in the Revolving Loan Commitments) in an amount
equal to the amount of any such deficit, and Company shall
concurrently therewith deliver to Administrative Agent an Officer's
Certificate demonstrating the derivation of the additional Net Cash
Proceeds resulting in such deficit.
(b) Prepayments and Reductions Due to Issuance of Debt. On or
prior to the first Business Day after receipt by Company or any of its
Subsidiaries of any proceeds of any Indebtedness (other than the Loans
and any other Indebtedness permitted under subsection 7.1(i), (ii),
(iii), (iv), (v), (vii) or (viii)), Company shall prepay the Loans
(and/or the Revolving Loan Commitments shall be reduced) in an amount
equal to the amount of such proceeds; provided, however, that such
proceeds from Indebtedness permitted under subsection 7.1(vi) shall not
be applied to prepay Loans pursuant to this subsection if and to the
extent such proceeds are applied by Company to repay the Indebtedness
with respect to the Subordinated Notes; and provided further, that
payment or acceptance of the amounts provided for in this subsection
2.4B(iii)(b) shall not constitute a waiver of any Event of Default
resulting from the incurrence of such Indebtedness or otherwise
prejudice any rights or remedies of Agents or Lenders.
(c) Prepayments and Reductions Due to Issuance of Equity
Securities. At any time the Leverage Ratio is greater than 3.25:1.00,
on or prior to the first Business Day after receipt by Company or any
of its Subsidiaries of any Equity Proceeds after the Effective Date,
Company shall prepay the Loans (and/or the Revolving Loan Commitments
shall be reduced) in an amount equal to 50% of such Equity Proceeds;
provided, however, that such Equity Proceeds shall not be applied to
prepay Loans pursuant to this subsection if and to the extent such
Equity Proceeds were derived (x) directly or indirectly from a sale of
Securities to employees or directors of Company and its Subsidiaries
pursuant to any employee stock option or stock purchase plan or other
50
employee benefit plan, and (y) from sales of Securities to management
officers and directors after the Effective Date to the extent the
consideration paid therefor does not exceed $5,000,000.
(d) Prepayments and Reductions from Insurance and Condemnation
Proceeds. No later than the second Business Day following the date of
receipt by Company or any of its Subsidiaries of any cash payments
under any of the casualty insurance policies covering damage to or
loss of property maintained pursuant to subsection 6.4 resulting from
damage to or loss of all or any portion of the Collateral or any other
tangible asset (net of actual and documented reasonable costs incurred
by Company or any of its Subsidiaries in connection with adjustment
and settlement thereof, "Insurance Proceeds") or any proceeds
resulting from the taking of assets by the power of eminent domain,
condemnation or otherwise (net of actual and documented reasonable
costs incurred by Company or any of its Subsidiaries in connection
with adjustment and settlement thereof, "Condemnation Proceeds")
(other than, if no Event of Default shall have occurred and be
continuing or shall be caused thereby, any portion of any such
proceeds that is reinvested (or scheduled for reinvestment) in assets
of the general type used in the business of Company and its
Subsidiaries within 360 days from the date of receipt of such
proceeds), Company shall prepay the Loans (and/or the Revolving Loan
Commitments shall be reduced) in the amount of such proceeds not so
reinvested (or scheduled for such reinvestment). Company shall, no
later than 360 days after receipt of any such Insurance Proceeds or
Condemnation Proceeds that have not theretofore been applied to the
Obligations, make an additional prepayment of the Loans (and/or the
Revolving Loan Commitments shall be reduced) in the full amount of all
such proceeds that have not therefore been reinvested in such assets.
(e) Prepayments and Reductions from Consolidated Excess Cash
Flow. In the event that there shall be Consolidated Excess Cash Flow
for any Fiscal Year (commencing with the Fiscal Year ending in December
1998), Company shall, no later than 100 days after the end of such
Fiscal Year, prepay the Loans (and/or the Revolving Loan Commitments
shall be reduced) in an aggregate amount equal to 50% of such
Consolidated Excess Cash Flow for such Fiscal Year; provided however,
that if the Leverage Ratio is less than or equal to 4.00:1.00, then
such prepayment of the Loans and/or reduction of the Revolving Loan
Commitments shall be in an aggregate amount equal to 25% of such
Consolidated Excess Cash Flow for such Fiscal Year.
(f) Prepayments Due to Reductions or Restrictions of Revolving
Loan Commitments. Company shall prepay the Swing Line Loans and/or the
Revolving Loans from time to time to the extent necessary so that (y)
the Total Utilization of Revolving Loan Commitments shall not at any
time exceed the Revolving Loan Commitments then in effect, and (z) the
aggregate principal amount of all outstanding Swing Line Loans shall
not at any time exceed the Swing Line Loan Commitment then in effect.
All Swing Line Loans shall be prepaid in full prior to the prepayment
of any Revolving Loans pursuant to this subsection 2.4B(iii)(f).
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C. Application of Prepayments and Unscheduled
Reductions of Revolving Loan Commitments.
(i) Application of Voluntary Prepayments by Type of Loans. Any
voluntary prepayments pursuant to subsection 2.4B(i) shall be applied: first to
repay outstanding Swing Line Loans to the full extent thereof, second to repay
outstanding Revolving Loans to the full extent thereof, and third, to repay
outstanding Term Loans pro rata and shall be applied to the remaining
installments thereof on a pro rata basis to the full extent thereof.
(ii) Application of Mandatory Prepayments by Type of Loans. Any
amount (the "Applied Amount") required to be applied as a mandatory prepayment
of the Loans and/or a reduction of the Revolving Loan Commitments pursuant to
subsections 2.4B(iii)(a)-(e) shall be applied: first to prepay the Term Loans
pro rata and shall be applied to the remaining installments thereof on a pro
rata basis to the full extent thereof, second, to the extent of any remaining
portion of the Applied Amount, to prepay the Swing Line Loans to the full extent
thereof and to permanently reduce the Revolving Loan Commitments by the amount
of such prepayment, third, to the extent of any remaining portion of the Applied
Amount, to prepay the Revolving Loans to the full extent thereof and to further
permanently reduce the Revolving Loan Commitments by the amount of such
prepayment, and fourth, to the extent of any remaining portion of the Applied
Amount, to further permanently reduce the Revolving Loan Commitments to the full
extent thereof. Notwithstanding the foregoing or anything herein to the
contrary, no portion of the proceeds of Indebtedness permitted under subsection
7.1(vi) which are applied to prepay the Loans shall be applied to permanently
reduce the Revolving Loan Commitments.
(iii) Application of Prepayments of Term Loans to the Scheduled
Installments of Principal Thereof. Any prepayments of the Term Loans pursuant to
subsection 2.4B(i) or 2.4B(iii) shall be applied to prepay the Term Loans on a
pro rata basis in accordance with the outstanding principal amounts thereof. Any
mandatory prepayments applied to the Term Loans pursuant to this subsection
shall be applied on a pro rata basis (in accordance with the respective
outstanding principal amounts thereof) to each scheduled installment of
principal of the Term Loans set forth in subsection 2.4A(i) that is unpaid at
the time of such prepayment.
(iv) Application of Prepayments to Base Rate Loans and Eurodollar
Rate Loans. Considering Term Loans and Revolving Loans being prepaid separately,
any prepayment thereof shall be applied first to Base Rate Loans to the full
extent thereof before application to Eurodollar Rate Loans, in each case in a
manner which minimizes the amount of any payments required to be made by Company
pursuant to subsection 2.6D.
(v) Application of Unscheduled Reductions of Revolving Loan
Commitments. Any voluntary or mandatory reduction of the Revolving Loan
Commitments pursuant to subsection 2.4B(ii) or 2.4B(iii) shall be applied to
reduce the scheduled reductions of the Revolving Loan Commitments set forth in
subsection 2.4A(ii) in reverse chronological order.
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D. Application of Proceeds of
Collateral and Payments Under Guaranties.
(i) Application of Proceeds of Collateral. Except as provided in
subsection 2.4B(iii)(a) with respect to prepayments from Net Cash Proceeds of
Asset Sales, all proceeds received by Administrative Agent in respect of any
sale of, collection from, or other realization upon all or any part of the
Collateral under any Collateral Document may, in the discretion of
Administrative Agent, be held by Administrative Agent as Collateral for, and/or
(then or at any time thereafter) applied in full or in part by Administrative
Agent against, the applicable Secured Obligations (as defined in such Collateral
Document) in the following order of priority:
(a) To the payment of all costs and expenses of such sale,
collection or other realization, including without limitation
reasonable compensation to Administrative Agent and its agents and
counsel, and all other reasonable expenses, liabilities and advances
made or incurred by Administrative Agent in connection therewith, and
all amounts for which Administrative Agent is entitled to
indemnification under such Collateral Document and all advances made by
Administrative Agent thereunder for the account of the applicable Loan
Party, and to the payment of all reasonable costs and expenses paid or
incurred by Administrative Agent in connection with the exercise of any
right or remedy under such Collateral Document, all in accordance with
the terms of this Agreement and such Collateral Document;
(b) thereafter, to the extent of any excess such proceeds, to
the payment of all other such Secured Obligations for the ratable
benefit of the holders thereof; and
(c) thereafter, to the extent of any excess such proceeds, to
the payment to or upon the order of such Loan Party or to whosoever may
be lawfully entitled to receive the same or as a court of competent
jurisdiction may direct.
(ii) Application of Payments Under Guaranties. All payments received
by Administrative Agent under any Guaranty shall be applied promptly from time
to time by Administrative Agent in the following order of priority:
(a) To the payment of the reasonable costs and expenses of any
collection or other realization under such Guaranty, including without
limitation reasonable compensation to Administrative Agent and its
agents and counsel, and all expenses, liabilities and advances made or
incurred by Administrative Agent in connection therewith, all in
accordance with the terms of this Agreement and such Guaranty;
(b) thereafter, to the extent of any excess of such payments,
to the payment of all other Guarantied Obligations (as defined in such
Guaranty) for the ratable benefit of the holders thereof; and
(c) thereafter, to the extent of any excess of such payments,
to the payment the applicable Subsidiary Guarantor or to whosoever may
be lawfully entitled to receive the same or as a court of competent
jurisdiction may direct.
53
E. General Provisions Regarding Payments.
(i) Manner and Time of Payment. All payments by Company of
principal, interest, fees and other Obligations hereunder and under the Notes
shall be made in same day funds and without defense, setoff or counterclaim,
free of any restriction or condition, and delivered to Administrative Agent not
later than 12:00 Noon (New York time) on the date due at the Funding and Payment
Office for the account of Lenders; funds received by Administrative Agent after
that time on such due date shall be deemed to have been paid by Company on the
next succeeding Business Day. Company hereby authorizes Administrative Agent to
charge its accounts with such Administrative Agent in order to cause timely
payment to be made to Administrative Agent of all principal, interest, fees and
expenses due hereunder (subject to sufficient funds being available in its
accounts for that purpose).
(ii) Application of Payments to Principal and Interest. Except as
provided in subsection 2.2C, all payments in respect of the principal amount of
any Loan shall include payment of accrued interest on the principal amount being
repaid or prepaid, and all such payments (and in any event any payments made in
respect of any Loan on a date when interest is due and payable with respect to
such Loan) shall be applied to the payment of interest before application to
principal.
(iii) Apportionment of Payments. Aggregate principal and interest
payments shall be apportioned among all outstanding Loans to which such payments
relate, in each case proportionately to Lenders' respective Pro Rata Shares.
Administrative Agent shall promptly distribute to each Lender, at its applicable
Lending Office specified on Schedule 2.1 or at such other address as such Lender
may request, its Pro Rata Share of all such payments received by Administrative
Agent and the commitment fees of such Lender when received by Administrative
Agent pursuant to subsection 2.3. Notwithstanding the foregoing provisions of
this subsection 2.4E(iii) if, pursuant to the provisions of subsection 2.6C, any
Notice of Conversion/Continuation is withdrawn as to any Affected Lender or if
any Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of any
Eurodollar Rate Loans, Administrative Agent shall give effect thereto in
apportioning payments received thereafter.
(iv) Payments on Business Days. Whenever any payment to be made
hereunder shall be stated to be due on a day that is not a Business Day, such
payment shall be made on the next succeeding Business Day and such extension of
time shall be included in the computation of the payment of interest hereunder
or of the commitment fees hereunder, as the case may be.
(v) Notation of Payment. Each Lender agrees that before disposing
of any Note held by it, or any part thereof (other than by granting
participations therein), that Lender will make a notation thereon of all Loans
evidenced by that Note and all principal payments previously made thereon and
of the date to which interest thereon has been paid; provided that the failure
to make (or any error in the making of) a notation of any Loan made under such
Note shall not limit or otherwise affect the obligations of Company hereunder
or under such Note with respect to any Loan or any payments of principal or
interest on such Note.
2.5 Use of Proceeds.
54
A. Term Loans. The proceeds of the Term Loans, together with
the proceeds of the Revolving Loans made on the Effective Date, the Equity
Proceeds from the Initial Public Offering described in subsection 4.1C and the
proceeds from the New Subordinated Notes, shall be applied to (i) refinance
indebtedness under the Existing Credit Agreement and the VDK Credit Agreement
and (ii) pay Transaction Costs.
B. Revolving Loans; Swing Line Loans. The proceeds of the
Revolving Loans and any Swing Line Loans shall be applied by Company (i) as
provided in subsection 2.5A and to finance expenditures which are included in
the definition of Consolidated Capital Expenditures and for working capital and
general corporate purposes, including acquisitions in accordance with subsection
7.7(vi), and which may include the making of intercompany loans to any of
Company's Wholly Owned Subsidiaries, in accordance with subsection 7.1(iv), for
their own working capital and general corporate purposes and (ii) to the payment
of premiums and related costs and expenses to repay the VDK Subordinated Notes.
C. Compliance With Laws. Company hereby undertakes that no
portion of the proceeds of any Loans or other extensions of credit under this
Agreement shall be used by any Loan Party in any manner which would be illegal
under, or which would cause the invalidity or unenforceability (in each case in
whole or in part) of any Loan Document under, any applicable law.
D. Margin Regulations. Without limiting the generality of
subsection 2.5C, no portion of the proceeds of any borrowing under this
Agreement shall be used by Company or any of its Subsidiaries in any manner that
might cause the borrowing or the application of such proceeds to violate
Regulation U, Regulation T or Regulation X of the Board of Governors of the
Federal Reserve System or any other regulation of such Board or to violate the
Exchange Act, in each case as in effect on the date or dates of such borrowing
and such use of proceeds.
2.6 Special Provisions Governing Eurodollar Rate Loans.
Notwithstanding any other provision of this Agreement to the
contrary, the following provisions shall govern with respect to Eurodollar Rate
Loans as to the matters covered:
A. Determination of Applicable Interest Rate. As soon
as practicable after 11:00 A. M. (New York time) on each Interest Rate
Determination Date, Administrative Agent shall determine (which determination
shall, absent manifest error, be final, conclusive and binding upon all
parties) the interest rate that shall apply to the Eurodollar Rate Loans for
which an interest rate is then being determined for the applicable Interest
Period and shall promptly give notice thereof (in writing or by telephone
confirmed in writing) to Company and each Lender.
B. Inability to Determine Applicable Interest Rate. In the
event that Administrative Agent shall have reasonably determined (which
determination shall be final and conclusive and binding upon all parties
hereto), on any Interest Rate Determination Date with respect to any Eurodollar
Rate Loans, that by reason of circumstances arising after the date of
55
this Agreement affecting the London interbank market, adequate and fair means
do not exist for ascertaining the interest rate applicable to such Loans on
the basis provided for in the definition of Adjusted Eurodollar Rate,
Administrative Agent shall on such date give notice (by telecopy or by
telephone confirmed in writing) to Company and each Lender of such
determination, whereupon (i) no Loans may be made as, or converted to,
Eurodollar Rate Loans, until such time as Administrative Agent notifies
Company and Lenders that the circumstances giving rise to such notice no
longer exist (such notification not to be unreasonably withheld or delayed)
and (ii) any Notice of Borrowing or Notice of Conversion/Continuation given
by Company with respect to the Loans in respect of which such determination
was made shall be deemed to be rescinded by Company.
C. Illegality or Impracticability of Eurodollar Rate Loans. In
the event that on any date any Lender shall have reasonably determined (which
determination shall be final and conclusive and binding upon all parties hereto
but shall be made only after consultation with Company and Administrative Agent)
that the making, maintaining or continuation of its Eurodollar Rate Loans (i)
has become unlawful as a result of compliance by such Lender in good faith with
any law, treaty, governmental rule, regulation, guideline or order (or would
conflict with any such treaty, governmental rule, regulation, guideline or order
not having the force of law even though the failure to comply therewith would
not be unlawful) or (ii) has become impracticable, or would cause such Lender
material hardship, as a result of contingencies occurring after the date of this
Agreement which materially and adversely affect the London interbank market,
then, and in any such event, such Lender shall be an "Affected Lender" and it
shall on that day give notice (by telecopy or by telephone confirmed in writing)
to Company and Administrative Agent of such determination (which notice
Administrative Agent shall promptly transmit to each other Lender). Thereafter
(a) the obligation of the Affected Lender to make Loans as, or to convert Loans
to, Eurodollar Rate Loans, shall be suspended until such notice shall be
withdrawn by the Affected Lender, (b) to the extent such determination by the
Affected Lender relates to a Eurodollar Rate Loan then being requested by
Company pursuant to a Notice of Borrowing or a Notice of
Conversion/Continuation, the Affected Lender shall make such Loan as (or convert
such Loan to, as the case may be) a Base Rate Loan, (c) the Affected Lender's
obligation to maintain its outstanding Eurodollar Rate Loans, as the case may be
(the "Affected Loans"), shall be terminated at the earlier to occur of the
expiration of the Interest Period then in effect with respect to the Affected
Loans or when required by law, and (d) the Affected Loans shall automatically
convert into Base Rate Loans on the date of such termination. Notwithstanding
the foregoing, to the extent a determination by an Affected Lender as described
above relates to a Eurodollar Rate Loan then being requested by Company
pursuant to a Notice of Borrowing or a Notice of Conversion/Continuation,
Company shall have the option, subject to the provisions of subsection 2.6D,
to rescind such Notice of Borrowing or Notice of Conversion/Continuation as to
all Lenders by giving notice (by telecopy or by telephone confirmed in writing)
to Administrative Agent of such rescission on the date on which the Affected
Lender gives notice of its determination as described above (which notice of
rescission Administrative Agent shall promptly transmit to each other Lender).
Except as provided in the immediately preceding sentence, nothing in this
subsection 2.6C shall affect the obligation of any Lender other than an
Affected Lender to make or maintain Loans as, or to convert Loans to,
Eurodollar Rate Loans in accordance with the terms of this Agreement.
D. Compensation For Breakage or Non-Commencement of Interest
Periods.
56
Company shall compensate each Lender, upon written request by that Lender
(which request shall set forth the basis for requesting such amounts), for
all reasonable losses, expenses and liabilities (including, without
limitation, any interest paid by that Lender to lenders of funds borrowed by
it to make or carry its Eurodollar Rate Loans and any loss, expense or
liability sustained by that Lender in connection with the liquidation or
reemployment of such funds) which that Lender may sustain: (i) if for any
reason (other than a default by that Lender) a borrowing of any Eurodollar
Rate Loan does not occur on a date specified therefor in a Notice of
Borrowing or a telephonic request for borrowing, or a conversion to or
continuation of any Eurodollar Rate Loan does not occur on a date specified
therefor in a Notice of Conversion/Continuation or a telephonic request for
conversion or continuation, (ii) if any prepayment (including without
limitation any prepayment pursuant to subsection 2.4B(i)) or conversion of
any of its Eurodollar Rate Loans occurs on a date that is not the last day of
an Interest Period applicable to that Loan, (iii) if any prepayment of any of
its Eurodollar Rate Loans is not made on any date specified in a notice of
prepayment given by Company, or (iv) as a consequence of any other default by
Company in the repayment of its Eurodollar Rate Loans when required by the
terms of this Agreement.
E. Booking of Eurodollar Rate Loans. Any Lender may
make, carry or transfer Eurodollar Rate Loans at, to, or for the account of
any of its branch offices or the office of an Affiliate of that Lender.
F. Assumptions Concerning Funding of Eurodollar Rate Loans.
Calculation of all amounts payable to a Lender under this subsection 2.6 and
under subsection 2.7A shall be made as though that Lender had actually funded
each of its relevant Eurodollar Rate Loans through the purchase of a Eurodollar
deposit bearing interest at the rate obtained pursuant to clause (i) of the
definition of Adjusted Eurodollar Rate in an amount equal to the amount of such
Eurodollar Rate Loan and having a maturity comparable to the relevant Interest
Period and through the transfer of such Eurodollar deposit from an offshore
office of that Lender to a domestic office of that Lender in the United States
of America; provided, however, that each Lender may fund each of its Eurodollar
Rate Loans in any manner it sees fit and the foregoing assumptions shall be
utilized only for the purposes of calculating amounts payable under this
subsection 2.6 and under subsection 2.7A.
G. Eurodollar Rate Loans After Default. After the occurrence
of and during the continuation of a Potential Event of Default or an Event of
Default, (i) Company may not elect to have a Loan be made or maintained as, or
converted to, a Eurodollar Rate Loan after the expiration of any Interest Period
then in effect for that Loan and (ii) subject to the provisions of subsection
2.6D, any Notice of Borrowing or Notice of Conversion/ Continuation given by
Company with respect to a requested borrowing or conversion/ continuation that
has not yet occurred shall be deemed to be rescinded by Company.
2.7 Increased Costs; Taxes; Capital Adequacy.
A. Compensation for Increased Costs and Taxes. Subject to the
provisions of subsection 2.7B (which shall be controlling with respect to the
matters covered thereby), in the event that any law, treaty or governmental
rule, regulation or order, or any change therein or in the interpretation,
administration or application thereof (including the introduction of any new
57
law, treaty or governmental rule, regulation or order), or any determination of
a court or governmental authority, in each case that becomes effective after the
date hereof, or compliance by such Lender with any guideline, request or
directive issued or made after the date hereof by any central bank or other
governmental or quasigovernmental authority (whether or not having the force of
law):
(i) results in a change in the basis of taxation of such
Lender (or its applicable lending office) (other than a change with
respect to any Tax on the overall net income of such Lender) with
respect to this Agreement or any of its obligations hereunder or any
payments to such Lender (or its applicable lending office) of
principal, interest, fees or any other amount payable hereunder;
(ii) imposes, modifies or holds applicable any reserve
(including, without limitation, any marginal, emergency, supplemental,
special or other reserve), special deposit, compulsory loan, FDIC
insurance or similar requirement against assets held by, or deposits or
other liabilities in or for the account of, or advances or loans by, or
other credit extended by, or any other acquisition of funds by, any
office of such Lender (other than any such reserve or other
requirements with respect to Eurodollar Rate Loans that are reflected
in the definition of Adjusted Eurodollar Rate; or
(iii) imposes any other condition (other than with respect
to a Tax matter) on or affecting such Lender (or its applicable lending
office) or its obligations hereunder, or the London interbank market;
and the result of any of the foregoing is to increase the cost to such Lender
of agreeing to make, making or maintaining Eurodollar Rate Loans hereunder or
to reduce any amount received or receivable by such Lender (or its applicable
lending office) with respect thereto; then, in any such case, Lender shall
promptly notify Company and Administrative Agent thereof and Company shall
promptly pay to such Lender, upon receipt of the statement referred to in the
next sentence, such additional amount or amounts (in the form of an increased
rate of, or a different method of calculating, interest or otherwise as such
Lender shall reasonably determine) as may be necessary to compensate such
Lender for any such increased cost or reduction in amounts received or
receivable hereunder. Such Lender shall deliver to Company (with a copy to
Administrative Agent) a written statement, setting forth in reasonable detail
the basis for calculating the additional amounts owed to such Lender under
this subsection 2.7A, which statement shall be prima facie evidence of such
additional amounts.
B. Withholding of Taxes.
(i) Payments to Be Free and Clear. All sums payable by Company
under this Agreement and the other Loan Documents shall (except to the extent
required by law) be paid free and clear of, and without any deduction or
withholding on account of, any Tax (other than a Tax on the overall net income
of any Lender) imposed, levied, collected, withheld or assessed by or within the
United States of America or any political subdivision in or of the United States
of America or any other jurisdiction from which a payment is made by or on
behalf of Company.
(ii) Withholding of Taxes. If Company or any other Person is
required by law
58
to make any deduction or withholding on account of any such Tax
from any sum paid or payable by Company to Administrative Agent or any Lender
under any of the Loan Documents:
(a) Company shall notify Administrative Agent of any such
requirement or any change in any such requirement as soon as Company
becomes aware of it;
(b) Company shall pay any such Tax before the date on which
penalties attach thereto, such payment to be made (if the liability to
pay is imposed on Company) for its own account or (if that liability is
imposed on Administrative Agent or such Lender, as the case may be) on
behalf of and in the name of Administrative Agent or such Lender;
(c) the sum payable by Company in respect of which the
relevant deduction, withholding or payment is required shall be
increased to the extent necessary to ensure that, after the making of
that deduction, withholding or payment, Administrative Agent or such
Lender, as the case may be, receives on the due date a net sum equal to
what it would have received had no such deduction, withholding or
payment been required or made; and
(d) within 30 days after paying any sum from which it is
required by law to make any deduction or withholding, and within 30
days after the due date of payment of any Tax which it is required by
clause (b) above to pay, Company shall deliver to Administrative Agent
evidence of such deduction, withholding or payment and of the
remittance thereof to the relevant taxing or other authority;
provided that no such additional amount shall be required to be paid to any
Lender under clause (c) above except to the extent that any change after
the date hereof (in the case of each Lender listed on the signature pages
hereof) or after the date of the Assignment Agreement pursuant to which such
Lender became a Lender (in the case of each other Lender) in any such
requirement for a deduction, withholding or payment as is mentioned therein
shall result in an increase in the rate of such deduction, withholding or
payment from that in effect at the date of this Agreement or at the date of
such Assignment Agreement, as the case may be, in respect of payments to such
Lender.
(iii) Evidence of Exemption from U.S. Withholding Tax.
(a) Each Lender that is organized under the laws of any
jurisdiction other than the United States or any state or other
political subdivision thereof (for purposes of this subsection
2.7B(iii), a "Non-US Lender") shall deliver to Administrative Agent for
transmission to Company, on or prior to the Closing Date (in the case
of each Existing Lender), on or prior to the Effective Date (in the
case of each New Lender) or on or prior to the date of the Assignment
Agreement pursuant to which it becomes a Lender (in the case of each
other Lender), and at such other times as may be necessary in the
determination of Company or Administrative Agent (each in the
reasonable exercise of its discretion), (1) two original copies of
Internal Revenue Service Form 1001 or 4224 (or any successor forms),
accurately completed and duly executed by such Lender, together with
any other certificate or statement of exemption required under the
Internal Revenue Code or the regulations issued thereunder to establish
that such Lender is not subject to
59
deduction or withholding of United States federal income tax with
respect to any payments to such Lender of principal, interest, fees
or other amounts payable under any of the Loan Documents or (2) if
such Lender is not a "bank" or other Person described in Section
881(c)(3) of the Internal Revenue Code and cannot deliver either
Internal Revenue Service Form 1001 or 4224 (or any successor forms)
pursuant to clause (1) above, a Certificate re Non-Bank Status
together with two original copies of Internal Revenue Service Form W-8
(or any successor form), properly completed and duly executed by such
Lender, together with any other certificate or statement of exemption
required under the Internal Revenue Code or the regulations issued
thereunder to establish that such Lender is not subject to deduction
or withholding of United States federal income tax with respect to any
payments to such Lender of interest payable under any of the Loan
Documents.
(b) Each Lender required to deliver any forms, certificates or
other evidence with respect to United States federal income tax
withholding matters pursuant to subsection 2.7B(iii)(a) hereby agrees,
from time to time after the initial delivery by such Lender of such
forms, certificates or other evidence, whenever a lapse in time or
change in circumstances renders such forms, certificates or other
evidence obsolete or inaccurate in any material respect, such Lender
shall (1) deliver to Administrative Agent for transmission to Company
two new original copies of Internal Revenue Service Form 1001 or 4224
(or any successor forms), or a Certificate re Non-Bank Status and two
original copies of Internal Revenue Service Form W-8 (or any
successor form), as the case may be, accurately completed and duly
executed by such Lender, together with any other certificate or
statement of exemption required in order to confirm or establish that
such Lender is not subject to deduction or withholding of United States
federal income tax with respect to payments to such Lender under the
Loan Documents or (2) immediately notify Administrative Agent and
Company of its inability to deliver any such forms, certificates or
other evidence.
(c) Company shall not be required to pay any additional amount
to any Non-US Lender under clause (c) of subsection 2.7B(ii) in respect
of deductions or withholdings of United States federal income taxes if
such Lender shall have failed to satisfy the requirements of subsection
2.7B(iii)(a) or 2.7B(iii)(b); provided that if such Lender shall have
satisfied such requirements on the Closing Date (in the case of each
Existing Lender), on the Effective Date (in the case of each New
Lender) or on the date of the Assignment Agreement pursuant to which it
became a Lender (in the case of each other Lender), nothing in this
subsection 2.7B(iii)(c) shall relieve Company of its obligation to pay
any additional amounts pursuant to clause (c) of subsection 2.7B(ii) in
the event that, as a result of any change in any applicable law, treaty
or governmental rule, regulation or order, or any change in the
interpretation, administration or application thereof, such Lender is
no longer properly entitled to deliver forms, certificates or other
evidence at a subsequent date establishing the fact that such Lender is
not subject to withholding as described in subsection 2.7B(iii)(a) or
2.7B(iii)(b).
C. Capital Adequacy Adjustment. If any Lender shall have
determined that the adoption, effectiveness, phase-in or applicability after the
date hereof of any law, rule or regulation (or any provision thereof) regarding
capital adequacy, or any change therein or in
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the interpretation or administration thereof by the National Association of
Insurance Commissioners, any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof,
or compliance by any Lender (or its applicable lending office) with any
guideline, request or directive regarding capital adequacy (whether or not
having the force of law) of the National Association of Insurance
Commissioners, any such governmental authority, central bank or comparable
agency, has or would have the effect of reducing the rate of return on the
capital of such Lender or any corporation controlling such Lender as a
consequence of, or with reference to, such Lender's Loans or Commitments or
Letters of Credit or participations therein or other obligations hereunder
with respect to the Loans or the Letters of Credit to a level below that
which such Lender reasonably determines such Lender or such controlling
corporation could have achieved but for such adoption, effectiveness,
phase-in, applicability, change or compliance (taking into consideration the
policies of such Lender or such controlling corporation with regard to
capital adequacy), then from time to time, within fifteen Business Days after
receipt by Company from such Lender of the statement referred to in the next
sentence, Company shall pay to such Lender such additional amount or amounts
as will compensate such Lender or such controlling corporation on an
after-tax basis for such reduction. Such Lender shall deliver to Company
(with a copy to Administrative Agent) a written statement, setting forth in
reasonable detail the basis of the calculation of such additional amounts,
which statement shall be conclusive and binding upon all parties hereto absent
manifest error.
D. Substitute Lenders. In the event Company is required under
the provisions of this subsection 2.7 to make payments in a material amount to
any Lender or in the event any Lender fails to lend to Company in accordance
with this Agreement, Company may, so long as no Event of Default or Potential
Event of Default shall have occurred and be continuing, elect to terminate such
Lender as a party to this Agreement; provided that, concurrently with such
termination, (i) Company shall pay that Lender all principal interest and fees
and other amounts (including without limitation amounts, if any, owed under this
subsection 2.7) due to be paid to such Lender with respect to all periods
through such date of termination, (ii) another financial institution
satisfactory to Company and Administrative Agent shall agree, as of such date,
to become a Lender for all purposes under this Agreement (whether by assignment
or amendment) and to assume all obligations of the Lender to be terminated as of
such date, and (iii) all documents and supporting materials necessary, in the
judgment of Administrative Agent to evidence the substitution of such Lender
shall have been received and approved by Administrative Agent as of such date.
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2.8 Obligation of Lenders and Issuing Lenders to Mitigate.
Each Lender and Issuing Lender agrees that, as promptly as
practicable after the officer of such Lender or Issuing Lender responsible for
administering the Loans or Letters of Credit of such Lender or Issuing Lender,
as the case may be, becomes aware of the occurrence of an event or the existence
of a condition that would cause such Lender to become an Affected Lender or that
would entitle such Lender or Issuing Lender to receive payments under subsection
2.7 or subsection 3.6, it will, to the extent not inconsistent with the internal
policies of such Lender or Issuing Lender and any applicable legal or regulatory
restrictions, use reasonable efforts (i) to make, issue, fund or maintain the
Commitments of such Lender or the affected Loans or Letters of Credit of such
Lender or Issuing Lender through another lending or letter of credit office of
such Lender or Issuing Lender, or (ii) take such other measures as such Lender
or Issuing Lender may deem reasonable, if as a result thereof the circumstances
which would cause such Lender to be an Affected Lender would cease to exist or
the additional amounts which would otherwise be required to be paid to such
Lender or Issuing Lender pursuant to subsection 2.7 or subsection 3.6 would be
materially reduced and if, as determined by such Lender or Issuing Lender in its
sole discretion, the making, issuing, funding or maintaining of such Commitments
or Loans or Letters of Credit through such other lending or letter of credit
office or in accordance with such other measures, as the case may be, would not
otherwise materially adversely affect such Commitments or Loans or Letters of
Credit or the interests of such Lender or Issuing Lender; provided that such
Lender or Issuing Lender will not be obligated to utilize such other lending or
letter of credit office pursuant to this subsection 2.8 unless Company agrees to
pay all incremental expenses incurred by such Lender or Issuing Lender as a
result of utilizing such other lending or letter of credit office. A certificate
as to the amount of any such expenses payable by Company pursuant to this
subsection 2.8 (setting forth in reasonable detail the basis for requesting
such amount) submitted by such Lender or Issuing Lender to Company (with a
copy to Administrative Agent) shall be conclusive absent manifest error.
SECTION 3.
LETTERS OF CREDIT
3.1 Issuance of Letters of Credit and Lenders' Purchase of
Participations Therein.
A. Letters of Credit. In addition to Company requesting that
Lenders make Term Loans pursuant to subsection 2.1A(i), Revolving Loans pursuant
to subsection 2.1A(ii), and that Swing Line Lender make Swing Line Loans
pursuant to subsection 2.1A(iii), Company may request, in accordance with the
provisions of this subsection 3.1, from time to time during the period from the
Effective Date to but excluding the Revolving Loan Commitment Termination Date,
that one or more Lenders issue Letters of Credit for the account of Company for
the purposes specified in the definitions of Commercial Letters of Credit and
Standby Letters of Credit. Subject to the terms and conditions of this Agreement
and in reliance upon the representations and warranties of Company herein set
forth, any one or more Lenders may, but (except as provided in subsection
3.1B(ii)) shall not be obligated to, issue such Letters of Credit in accordance
with the provisions of this subsection 3.1; provided that Company shall not
request that any Lender issue (and no Lender shall issue):
(i) any Letter of Credit if, after giving effect to such
issuance, the
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Total Utilization of Revolving Loan Commitments would
exceed the Revolving Loan Commitments then in effect;
(ii) any Letter of Credit if, after giving effect to such
issuance, the Letter of Credit Usage would exceed $15,000,000;
(iii) any Standby Letter of Credit having an expiration date
later than the earlier of (a) the Revolving Loan Commitment Termination
Date and (b) the date which is one year from the date of issuance of
such Standby Letter of Credit; provided that the immediately preceding
clause (b) shall not prevent any Issuing Lender from agreeing that a
Standby Letter of Credit will automatically be extended for one or more
successive periods not to exceed one year each unless such Issuing
Lender elects not to extend for any such additional period; provided
further that, unless Requisite Lenders otherwise consent, such Issuing
Lender shall give notice that it will not extend such Standby Letter of
Credit if it has knowledge that an Event of Default has occurred and is
continuing on the last day on which such Issuing Lender may give notice
to the beneficiary that it will not extend such Standby Letter of
Credit;
(iv) any Commercial Letter of Credit (a) having an
expiration date later than the earlier of (X) 30 days prior to the
Revolving Loan Commitment Termination Date and (Y) the date which is
180 days from the date of issuance of such Commercial Letter of Credit
or (b) that is otherwise unacceptable to the applicable Issuing Lender
in its reasonable discretion;
(v) any Letter of Credit denominated in a currency other
than Dollars; or
(vi) any Letter of Credit during any period when a Lender
Default exists, unless each Issuing Lender has entered into
arrangements satisfactory to it and Company to eliminate such Issuing
Lender's risk with respect to the Defaulting Lender, including by cash
collateralizing such Defaulting Lender's Pro Rata Share of the Letter
of Credit Usage (after giving effect to the issuance of the proposed
Letter of Credit).
B. Mechanics of Issuance.
(i) Notice of Issuance. Whenever Company desires the issuance of a
Letter of Credit, it shall deliver to Administrative Agent, at the Funding and
Payment Office, a Notice of Issuance of Letter of Credit no later than 12:00
Noon (New York time) at least five Business Days, or such shorter period as may
be agreed to by the Issuing Lender in any particular instance, in advance of the
proposed date of issuance. The Notice of Issuance of Letter of Credit shall
specify (a) the proposed date of issuance (which shall be a Business Day), (b)
the face amount of or maximum aggregate liability under, as applicable, the
Letter of Credit, (c) the expiration date of the Letter of Credit, (d) the name
and address of the beneficiary, and (e) the verbatim text of the proposed Letter
of Credit or the proposed terms and conditions thereof, including a precise
description of any documents and the verbatim text of any certificates to be
presented by the beneficiary which, if presented by the beneficiary prior to the
expiration date of the Letter of Credit, would require the Issuing Lender to
make payment under the Letter of Credit; provided
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that the Issuing Lender, in its reasonable discretion, may require changes in
the text of the proposed Letter of Credit or any such documents or
certificates; provided further that no Letter of Credit shall require payment
against a conforming draft or other request for payment to be made thereunder
on the same Business Day (under the laws of the jurisdiction in which the
office of the Issuing Lender to which such draft or other request for payment
is required to be presented is located) that such draft or other request for
payment is presented if such presentation is made after 10:00 A.M. (in the
time zone of such office of the Issuing Lender) on such Business Day.
Company shall notify the applicable Issuing Lender (and
Administrative Agent, if Administrative Agent is not such Issuing Lender) prior
to the issuance of any Letter of Credit in the event that any of the matters to
which Company is required to certify in the applicable Notice of Issuance of
Letter of Credit is no longer true and correct as of the proposed date of
issuance of such Letter of Credit, and upon the issuance of any Letter of
Credit, Company shall be deemed to have recertified, as of the date of such
issuance, as to the matters to which Company is required to certify in the
applicable Notice of Issuance of Letter of Credit.
(ii) Determination of Issuing Lender. Upon receipt by Administrative
Agent of a Notice of Issuance of Letter of Credit pursuant to subsection 3.1B(i)
requesting the issuance of a Letter of Credit, in the event Administrative Agent
elects to issue such Letter of Credit, Administrative Agent shall promptly so
notify Company, and such Administrative Agent shall be the Issuing Lender with
respect thereto. In the event that Administrative Agent, in its sole
discretion, elects not to issue such Letter of Credit, Administrative Agent
shall promptly so notify Company, whereupon Company may request any other
Lender to issue such Letter of Credit by delivering to such Lender a copy of
the applicable Notice of Issuance of Letter of Credit. Any Lender so requested
to issue such Letter of Credit shall promptly notify Company and Administrative
Agent whether or not, in its sole discretion, it has elected to issue such
Letter of Credit, and any such Lender which so elects to issue such Letter of
Credit shall be the Issuing Lender with respect thereto. In the event that all
other Lenders shall have declined to issue such Letter of Credit,
notwithstanding the prior election of Administrative Agent not to issue such
Letter of Credit, Administrative Agent shall be obligated to issue such Letter
of Credit and shall be the Issuing Lender with respect thereto, notwithstanding
the fact that the sum of the Letter of Credit Usage with respect to such Letter
of Credit and with respect to all other Letters of Credit issued by
Administrative when aggregated with Administrative Agent's outstanding Revolving
Loans and Swing Line Loans, may exceed Administrative Agent's Revolving Loan
Commitment then in effect.
(iii) Issuance of Letter of Credit. Upon satisfaction or waiver (in
accordance with subsection 10.6) of the conditions set forth in subsection 4.3,
the Issuing Lender shall issue the requested Letter of Credit in accordance with
the Issuing Lender's standard operating procedures (any such issuance by
Administrative Agent being effected through the Funding and Payment Office), and
upon its issuance of such Letter of Credit the Issuing Lender shall promptly
notify Administrative Agent and each Lender of such issuance, which notice shall
be accompanied by a copy of such Letter of Credit.
(iv) Reports to Lenders. Within 30 days after the end of each
calendar quarter ending after the Closing Date, so long as any Letter of Credit
shall have been outstanding during such calendar quarter, each Issuing Lender
shall deliver to Administrative Agent and
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Administrative Agent shall deliver to each Lender a report setting forth for
such calendar quarter the daily maximum amount available to be drawn under
the Letters of Credit that were outstanding during such calendar quarter.
C. Lenders' Purchase of Participations in Letters of Credit.
Immediately upon the issuance of each Letter of Credit, each Lender having a
Revolving Loan Commitment shall be deemed to, and hereby agrees to, have
irrevocably purchased from the Issuing Lender a participation in such Letter of
Credit and any drawings honored or payments made thereunder in an amount equal
to such Lender's Pro Rata Share (with respect to the Revolving Loan Commitments)
of the maximum amount which is or at any time may become available to be drawn
or required to be paid thereunder.
3.2 Letter of Credit Fees.
Company agrees to pay the following amounts to each Issuing
Lender with respect to Letters of Credit issued by it for the account of
Company:
(i) with respect to each Letter of Credit, (a) a fronting
fee equal to 1/4 of 1% per annum of the daily maximum amount available
to be drawn under such Letter of Credit and (b) a Letter of Credit fee
equal to the product of (x) the Applicable Margin with respect to
Eurodollar Rate Revolving Loans and (y) the daily maximum amount
available to be drawn under such Letter of Credit, in each case payable
in arrears on and to each March 31, June 30, September 30 and December
31 of each year, commencing on December 31, 1998, and computed on the
basis of a 360-day year for the actual number of days elapsed; and
(ii) with respect to the issuance, amendment or transfer of
each Letter of Credit and each drawing made thereunder (without
duplication of the fees payable under clause (i) above), documentary
and processing charges in accordance with such Issuing Lender's
standard schedule for such charges in effect at the time of such
issuance, amendment, transfer or drawing, as the case may be.
Promptly upon receipt by such Issuing Lender of any amount described in clause
(i)(b) of this subsection 3.2, such Issuing Lender shall distribute to each
other Lender its Pro Rata Share of such amount.
3.3 Drawings and Payments and Reimbursement of Amounts Paid
Under Letters of Credit.
A. Responsibility of Issuing Lender With Respect to Requests
For Drawings and Payments. In determining whether to honor any drawing or
request for payment under any Letter of Credit by the beneficiary thereof, the
Issuing Lender shall be responsible only to determine that the documents and
certificates required to be delivered under such Letter of Credit have been
delivered and that they comply on their face with the requirements of such
Letter of Credit.
B. Reimbursement by Company of Amounts Paid Under Letters of
Credit. In
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the event an Issuing Lender has determined to honor a drawing or request for
payment under a Letter of Credit issued by it, such Issuing Lender shall
immediately notify Company and Administrative Agent, and Company shall
reimburse such Issuing Lender on or before the Business Day immediately
following the date on which such drawing is honored or such payment is made
(the applicable "Reimbursement Date"), in an amount in same day funds equal
to the amount of such drawing; provided that, anything contained in this
Agreement to the contrary notwithstanding, (i) unless Company shall have
notified Administrative Agent and such Issuing Lender prior to 12:00 Noon
(New York time) on the date of such drawing or request for payment that
Company intends to reimburse such Issuing Lender for the amount of such
honored drawing or payment with funds other than the proceeds of Revolving
Loans, Company shall be deemed to have given a timely Notice of Borrowing to
Administrative Agent requesting Lenders to make Revolving Loans which are
Base Rate Loans, on the applicable Reimbursement Date in an amount equal to
the amount of such honored drawing or payment and (ii) subject to
satisfaction or waiver of the conditions specified in subsection 4.2B,
Lenders shall, on the applicable Reimbursement Date, make Revolving Loans and
in the amount of such honored drawing or payment, the proceeds of which shall
be applied directly by Administrative Agent to reimburse such Issuing Lender
for the amount of such honored drawing or payment; provided further that if
for any reason proceeds of Revolving Loans are not received by such Issuing
Lender on the applicable Reimbursement Date in an amount equal to the amount
of such honored drawing or payment, Company shall reimburse such Issuing
Lender, on demand, in an amount in Dollars and in same day funds equal to the
excess of the amount of such honored drawing or payment over the aggregate
amount of such Revolving Loans, if any, which are so received. Nothing in
this subsection 3.3B shall be deemed to relieve any Lender from its
obligation to make Revolving Loans on the terms and conditions set forth in
this Agreement, and Company shall retain any and all rights it may have
against any Lender resulting from the failure of such Lender to make such
Revolving Loans under this subsection 3.3B.
C. Payment by Lenders of Unreimbursed Payments Under
Letters of Credit.
(i) Payment by Lenders. In the event that Company shall fail for
any reason to reimburse any Issuing Lender as provided in subsection 3.3B in an
amount equal to the amount of any honored drawing or payment made by such
Issuing Lender under a Letter of Credit issued by it, such Issuing Lender shall
promptly notify each other Lender of the unreimbursed amount of such honored
drawing or payment and of such other Lender's respective participation therein
based on such Lender's Pro Rata Share of the Revolving Loan Commitments. Each
Lender shall make available to such Issuing Lender an amount equal to its
respective participation, in same day funds, at the office of such Issuing
Lender specified in such notice, not later than 12:00 Noon (New York time) on
the first Business Day (under the laws of the jurisdiction in which such office
of such Issuing Lender is located) after the date notified by such Issuing
Lender. In the event that any Lender fails to make available to such Issuing
Lender on such Business Day the amount of such Lender's participation in such
Letter of Credit as provided in this subsection 3.3C, such Issuing Lender shall
be entitled to recover such amount on demand from such Lender together with
interest thereon at the rate customarily used by such Issuing Lender for the
correction of errors among banks for three Business Days and thereafter at the
Base Rate. Nothing in this subsection 3.3C shall be deemed to prejudice the
right of any Lender to recover from any Issuing Lender any amounts made
available by such Lender to such Issuing Lender pursuant to this subsection 3.3C
in the event that it is determined by the final
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judgment of a court of competent jurisdiction that the payment with respect
to a Letter of Credit by such Issuing Lender in respect of which payment was
made by such Lender constituted gross negligence or willful misconduct on the
part of such Issuing Lender.
(ii) Distribution to Lenders of Reimbursements Received From
Company. In the event any Issuing Lender shall have been reimbursed by other
Lenders pursuant to subsection 3.3C(i) for all or any portion of any honored
drawing or payment made by such Issuing Lender under a Letter of Credit issued
by it, such Issuing Lender shall distribute to each other Lender which has paid
all amounts payable by it under subsection 3.3C(i) with respect to such honored
drawing or payment such other Lender's Pro Rata Share of all payments
subsequently received by such Issuing Lender from Company in reimbursement of
such honored drawing or payment when such payments are received. Any such
distribution shall be made to a Lender at its primary address set forth below
its name on the appropriate signature page hereof or at such other address as
such Lender may request.
D. Interest on Amounts Paid Under Letters of Credit.
(i) Payment of Interest by Company. Company agrees to pay to each
Issuing Lender, with respect to drawings honored or payments made under any
Letters of Credit issued by it, interest on the amount paid by such Issuing
Lender in respect of each such drawing or payment from the date such drawing is
honored or payment is made to but excluding the date such amount is reimbursed
by Company (including any such reimbursement out of the proceeds of Revolving
Loans pursuant to subsection 3.3B) at a rate equal to (a) for the period from
the date such drawing is honored or payment is made to but excluding the
applicable Reimbursement Date, the Base Rate plus the Applicable Margin with
respect to Base Rate Revolving Loans, and (b) thereafter, a rate which is 2% per
annum in excess of the rate of interest described in the foregoing clause (a).
Interest payable pursuant to this subsection 3.3D(i) shall be computed on the
basis of a 360-day year for the actual number of days elapsed in the period
during which it accrues and shall be payable on demand or, if no demand is made,
on the date on which the related drawing or payment under a Letter of Credit is
reimbursed in full.
(ii) Distribution of Interest Payments by Issuing Lender. Promptly
upon receipt by any Issuing Lender of any payment of interest pursuant to
subsection 3.3D(i), (a) such Issuing Lender shall distribute to each other
Lender, out of the interest received by such Issuing Lender in respect of the
period from the date of the applicable honored drawing or payment under a Letter
of Credit issued by such Issuing Lender to but excluding the date on which such
Issuing Lender is reimbursed for the amount of such drawing or payment
(including any such reimbursement out of the proceeds of Revolving Loans
pursuant to subsection 3.3B), the amount that such other Lender would have been
entitled to receive in respect of the Letter of Credit fee that would have been
payable in respect of such Letter of Credit for such period pursuant to
subsection 3.2 if no drawing had been honored or payment had been made under
such Letter of Credit, and (b) in the event such Issuing Lender shall have been
reimbursed by other Lenders pursuant to subsection 3.3C(i) for all or any
portion of such drawing or payment, such Issuing Lender shall distribute to each
other Lender which has paid all amounts payable by it under subsection 3.3C(i)
with respect to such drawing or payment such other Lender's Pro Rata Share of
any interest received by such Issuing Lender in respect of that portion of such
drawing or payment so reimbursed by other Lenders for the period from the date
on which such Issuing
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Lender was so reimbursed by other Lenders to and including the date on which
such portion of such drawing or payment is reimbursed by Company. Any such
distribution shall be made to a Lender at its Lending Office set forth on
Schedule 2.1 or at such other address as such Lender may request.
3.4 Obligations Absolute.
The obligation of Company to reimburse each Issuing Lender for
drawings honored or payments made under the Letters of Credit issued by it and
to repay any Revolving Loans made by Lenders pursuant to subsection 3.3B and the
obligations of Lenders under subsection 3.3C(i) shall be unconditional and
irrevocable and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances including, without limitation, the following
circumstances:
(i) any lack of validity or enforceability of any Letter
of Credit;
(ii) the existence of any claim, set-off, defense or other
right which Company or any Lender may have at any time against a
beneficiary or any transferee of any Letter of Credit (or any Persons
for whom any such transferee may be acting), any Issuing Lender or
other Lender or any other Person or, in the case of a Lender, against
Company whether in connection with this Agreement, the transactions
contemplated herein or any unrelated transaction (including any
underlying transaction between Company or one of its Subsidiaries and
the beneficiary for which any Letter of Credit was procured);
(iii) any draft, demand, certificate or other document
presented under any Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect;
(iv) payment by the applicable Issuing Lender under any
Letter of Credit against presentation of a demand, draft or certificate
or other document which does not substantially comply with the terms of
such Letter of Credit;
(v) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or prospects of
Company or any of its Subsidiaries;
(vi) any breach of this Agreement or any other Loan
Document by any party thereto;
(vii) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing; or
(viii) the fact that an Event of Default or a Potential Event
of Default shall have occurred and be continuing;
provided, in each case, that payment by the applicable Issuing Lender under the
applicable Letter of Credit shall not have constituted gross negligence or
willful misconduct of such Issuing
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Lender under the circumstances in question (as determined by a final judgment
of a court of competent jurisdiction).
3.5 Indemnification; Nature of Issuing Lender's Duties.
A. Indemnification. In addition to amounts payable as provided
in subsection 3.6, Company hereby agrees to protect, indemnify, pay and save
harmless each Issuing Lender from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including reasonable
fees, expenses and disbursements of counsel and allocated costs of internal
counsel) which such Issuing Lender may incur or be subject to as a consequence,
direct or indirect, of (i) the issuance of any Letter of Credit by such Issuing
Lender, other than as a result of (a) the gross negligence or willful misconduct
of such Issuing Lender as determined by a final judgment of a court of competent
jurisdiction or (b) subject to the following clause (ii), the wrongful dishonor
by such Issuing Lender of a proper demand for payment made under any Letter of
Credit issued by it or (ii) the failure of such Issuing Lender to honor a
drawing or other request for payment under any such Letter of Credit as a result
of any act or omission, whether rightful or wrongful, of any present or future
de jure or de facto government or governmental authority (all such acts or
omissions herein called "Governmental Acts").
B. Nature of Issuing Lenders' Duties. As between Company and
any Issuing Lender, Company assumes all risks of the acts and omissions of, or
misuse of the Letters of Credit issued by such Issuing Lender by, the respective
beneficiaries of such Letters of Credit. In furtherance and not in limitation of
the foregoing, such Issuing Lender shall not be responsible for: (i) 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
any such Letter of Credit, even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason; (iii) failure of the beneficiary of
any such Letter of Credit to comply fully with any conditions required in order
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; (v) errors in
interpretation of technical terms; (vi) any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under any such
Letter of Credit or of the proceeds thereof; (vii) the misapplication by the
beneficiary of any such Letter of Credit of the proceeds of any drawing or
payment under such Letter of Credit; or (viii) any consequences arising from
causes beyond the control of such Issuing Lender, including, without limitation,
any Governmental Acts, and none of the above shall affect or impair, or prevent
the vesting of, any of such Issuing Lender's rights or powers hereunder.
In furtherance and extension and not in limitation of the
specific provisions set forth in the first paragraph of this subsection 3.5B,
any action taken or omitted by any Issuing Lender under or in connection with
the Letters of Credit issued by it or any documents and certificates delivered
thereunder, if taken or omitted in good faith, shall not put such Issuing Lender
under any resulting liability to Company.
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Notwithstanding anything to the contrary contained in this
subsection 3.5, Company shall retain any and all rights it may have against any
Issuing Lender for any liability arising solely out of the gross negligence or
willful misconduct of such issuing Lender, as determined by a final judgment of
a court of competent jurisdiction.
3.6 Increased Costs and Taxes Relating to Letters of Credit.
In the event that any law, treaty or governmental rule,
regulation or order, or any change therein or in the interpretation,
administration or application thereof (including the introduction of any new
law, treaty or governmental rule, regulation or order), or any determination of
a court or governmental authority, in each case that becomes effective after the
date hereof, or compliance by any Issuing Lender or Lender with any guideline,
request or directive issued or made after the date hereof by any central bank or
other governmental or quasi-governmental authority (whether or not having the
force of law):
(i) results in any change in the basis of taxation of such
Issuing Lender or Lender (or its applicable lending or letter of credit
office) (other than a change with respect to any Tax on the overall net
income of such Issuing Lender or Lender) with respect to the issuing or
maintaining of any Letters of Credit or the purchasing or maintaining
of any participations therein or any other obligations under this
Section 3, whether directly or by such being imposed on or suffered by
any particular Issuing Lender;
(ii) imposes, modifies or holds applicable any reserve
(including, without limitation, any marginal, emergency, supplemental,
special or other reserve), special deposit, compulsory loan, FDIC
insurance or similar requirement in respect of any Letters of Credit
issued by any Issuing Lender or participations therein purchased by any
Lender; or
(iii) imposes any other condition on or affecting such
Issuing Lender or Lender (or its applicable lending or letter of credit
office) regarding this Section 3 or any Letter of Credit or any
participation therein;
and the result of any of the foregoing is to increase the cost to such Issuing
Lender or Lender of agreeing to issue, issuing or maintaining any Letter of
Credit or agreeing to purchase, purchasing or maintaining any participation
therein or to reduce any amount received or receivable by such Issuing Lender or
Lender (or its applicable lending or letter of credit office) with respect
thereto; then, in any case, Company shall promptly pay to such Issuing Lender or
Lender, upon receipt of the statement referred to in the next sentence, such
additional amount or amounts (reasonably determined by such Issuing Lender or
Lender) as may be necessary to compensate such Issuing Lender or Lender for any
such increased cost or reduction in amounts received or receivable hereunder.
Such Issuing Lender or Lender shall deliver to Company a written statement,
setting forth in reasonable detail the basis for calculating the additional
amounts owed to such Issuing Lender or Lender under this subsection 3.6, which
statement shall be prima facie evidence of such additional amounts.
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SECTION 4.
CONDITIONS TO LOANS AND LETTERS OF CREDIT
The obligations of Lenders to make Loans and the issuance of
Letters of Credit hereunder are subject to the satisfaction of the following
conditions.
4.1 Conditions to Term Loans and Revolving Loans.
The obligations of Lenders to make the Term Loans and the
Revolving Loans are, in addition to the conditions precedent specified in
subsection 4.2, subject to prior or concurrent satisfaction of the following
conditions:
A. Company Documents.
On or before the Effective Date, Company shall deliver or
cause to be delivered to Lenders (or to Administrative Agent for Lenders with
sufficient originally executed copies, where appropriate, for each Lender and
its counsel) the following, each, unless otherwise noted, dated the Effective
Date:
(i) Certified copies of its Certificate of Incorporation, together with a good
standing certificate from the Secretary of State of the State of Delaware and
each other state in which it is qualified as a foreign corporation to do
business, each dated a recent date prior to the Effective Date;
(ii) Copies of its Bylaws, certified as of the Effective Date by its corporate
secretary or an assistant secretary as being in full force and effect without
modification or amendment;
(iii) Resolutions of its Board of Directors approving and authorizing the
execution, delivery and performance of the Transaction, this Agreement and the
other Loan Documents to which it is a party, certified as of the Effective Date
by its corporate secretary or an assistant secretary as being in full force and
effect without modification or amendment;
(iv) Signature and incumbency certificates of its officers executing this
Agreement and the other Loan Documents;
(v) Executed originals of this Agreement and the other Loan Documents to which
it is a party; and
(vi) Such other documents as Agents may reasonably request.
B. No Material Adverse Effect. Since December 31, 1997, no
Material Adverse Effect (in the opinions of Administrative Agent or Lenders)
shall have occurred.
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C. Corporate and Capital Structure; Capitalization of Company;
Equity Contribution.
(i) Corporate Structure. The corporate organizational structure,
capital structure and ownership of Company and its Subsidiaries shall be as set
forth on Schedule 4.1C annexed hereto.
(ii) Capital Structure and Ownership: Capitalization of Company. The
capital structure and ownership of Company, both before and after giving effect
to the Transaction, shall be as set forth on Schedule 4.1C annexed hereto.
(iii) Equity Contribution. On or before the Effective Date, Company
shall have received no less than $250,000,000 in primary gross proceeds from the
Initial Public Offering.
D. Issuance of New Subordinated Notes. On or before the
Effective Date, Company shall have issued and sold the New Subordinated Notes in
an aggregate principal amount of not less than $200,000,000 and Company shall
have delivered to Administrative Agent completed, correct and conformed copies
of the New Subordinated Notes, the Subordinated Note Indenture and the other
principal New Subordinated Note Documents, all in form and substance reasonably
satisfactory to the Administrative Agent. Company shall have provided evidence
satisfactory to Agents that the proceeds of the New Subordinated Notes have been
irrevocably committed, prior to the application of the proceeds of the Term
Loans and the Revolving Loans, to the refinancing of Indebtedness under the
Existing Credit Agreement and the VDK Credit Agreement.
E. Existing Liens; No Other Indebtedness Outstanding. All
security interests attaching to any of the assets of Van xx Xxxx'x created to
secure obligations under any Indebtedness shall have been terminated, and
Company shall have delivered to Administrative Agent UCC-3 termination
statements or assignments (or comparable forms) and any and all other
instruments of release, satisfaction, assignment and/or reconveyance (or
evidence of the filing thereof) as may be necessary or advisable to terminate
all such security interests and all other security interests in the Collateral.
Administrative Agent shall have received an Officers' Certificate of Company
stating that, after giving effect to the Transaction, Loan Parties shall have no
Indebtedness outstanding other than Indebtedness permitted under the Loan
Documents.
F. Necessary Consents. Company shall have obtained all
consents necessary or advisable in connection with the Transaction, the Loan
Documents and the continued operation of the business conducted by Company and
its Subsidiaries, and each of the foregoing shall be in full force and effect
and in form and substance satisfactory to Administrative Agent (except as
disclosed to and approved by Administrative Agent). All applicable waiting
periods shall have expired without any action being taken or threatened by any
competent authority which would restrain, prevent or otherwise impose adverse
conditions on the Transaction, and no action, request for stay, petition for
review or rehearing, reconsideration or appeal shall be pending and any time
for agency action to set aside its consent on its own motion shall have
expired.
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G. Collateral Access Agreements. Administrative Agent shall
have received from Company Collateral Access Agreements in form and substance
satisfactory to Administrative Agent with respect to any facility which
equipment of Company is located on the Effective Date. Company shall not own
interest in any real property on the Effective Date other than the Mortgaged
Properties in Pennsylvania and Tennessee and its Leasehold Property interest in
its offices in Columbus, Ohio.
H. Perfection of Security Interests in Personal Property and
Mixed Collateral. Company shall have taken or caused to be taken such actions in
such a manner so that Administrative Agent has, for the benefit of Agents and
Lenders, a valid and perfected First Priority security interest in the entire
personal property and mixed Collateral. Such actions shall include, without
limitation: (i) the delivery pursuant to the applicable Collateral Documents of
(a) certificates (which certificates shall be properly endorsed in blank for
transfer or accompanied by irrevocable undated stock powers duly endorsed in
blank all in form and substance satisfactory to Administrative Agent)
representing all of the shares of capital stock required to be pledged pursuant
to the Collateral Documents, and (b) all promissory notes or other instruments
(duly endorsed, where appropriate, in a manner satisfactory to Administrative
Agent) evidencing any Collateral; (d) delivery to Agents of (a) the results of a
recent search, by a Person satisfactory to Agents, of all effective Uniform
Commercial Code financing statements and fixture filings and all judgment and
tax lien filings which may have been made with respect to any personal or mixed
property of any Loan Party, together with copies of all such filings disclosed
by such search; (iii) the delivery to Administrative Agent of Uniform Commercial
Code financing statements and fixture filings executed by the applicable Loan
Parties as to all such Collateral granted by such Loan Parties for all
jurisdictions as may be necessary or desirable to perfect Administrative Agent's
security interest in such Collateral; (iv) the delivery to Administrative Agent
of all cover sheets or other documents or instruments required to be filed with
the PTO or the United States Copyright Office in order to create or perfect
Liens in respect of any IP Collateral or any registered copyrights of Company;
and (v) the delivery to Administrative Agent of evidence reasonably satisfactory
to Administrative Agent that all other filings (including, without limitation,
filings of Uniform Commercial Code termination statements and termination
statements with respect to prior Liens on IP Collateral), recordings and other
actions that Administrative Agent deems necessary or advisable to establish,
preserve and perfect the First Priority Liens granted to Administrative Agent in
personal and mixed property shall have been made.
I. Transaction Costs. Prior to the Effective Date, Company
shall have delivered to Administrative Agent and Lenders a schedule, in a form
satisfactory to Administrative Agent, setting forth Company's reasonable best
estimate of the Transaction Costs (other than amounts payable to Agents and
Lenders).
J. Opinions of Loan Parties' Counsel. Lenders and their
respective counsel shall have received (i) originally executed copies of one or
more favorable written opinions of White & Case LLP, counsel for the Loan
Parties, in form and substance reasonably satisfactory to Administrative Agent
and its counsel, dated as of the Effective Date and setting forth substantially
the matters in the opinion designated in Exhibit XII annexed hereto and as to
such other matters as Administrative Agent acting on behalf of Lenders may
reasonably request, and (ii) evidence satisfactory to Administrative Agent that
Loan Parties have instructed such counsel
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to deliver such opinion to Lenders.
K. Opinions of Agents' Counsel. Lenders shall have received
(i) originally executed copies of one or more favorable written opinions of
Xxxxxxx Xxxxxxx & Xxxxxxxx, counsel to Agents, dated as of the Effective Date,
substantially in the form of Exhibit XIII annexed hereto and as to such other
matters as Agents acting on behalf of Lenders may reasonably request, and (ii)
originally executed copies of one or more favorable written opinions of (a)
Bass, Xxxxx & Xxxx and (b) Xxxxxxxx Ingersoll Professional Corporation, local
counsel to the Agents, dated as of the Effective Date, substantially in the form
of Exhibit XIV annexed hereto and as to such other matters as Agents acting on
behalf of Lenders may request.
L. Fees. Company shall have paid to Agents, for
distribution (as appropriate) to Agents and Lenders, the fees payable on the
Effective Date referred to in subsection 2.3.
M. Financial Statements; Pro Forma Consolidated Balance Sheet.
On or before the Effective Date, Lenders shall have received from Company (i)
audited financial statements of Holdings for the years ending December 31, 1996
and December 27, 1997, (ii) unaudited financial statements of Holdings as at
Xxxxx 00, 0000 (xxx) audited financial statements of VDK Holdings for the
operating period September 19, 1995 through June 29, 1996 and for the year ended
June 30, 1997, (iv) unaudited financial statements of VDK Holdings for the nine
months ended March 31, 1998, and (v) a pro forma consolidated balance sheet of
Company and its Subsidiaries as at March 31, 1998 prepared in accordance with
GAAP and reflecting the consummation of the Transaction, the related financings
and the other transactions contemplated by the Loan Documents and the New
Subordinated Notes, which pro forma statement of assets shall be in form and
substance satisfactory to Lenders and shall be certified by the chief financial
officer of Company as (a) prepared based on good faith assumptions and on the
best information available to Company as of the date of delivery thereof and (b)
fairly presenting on a pro forma basis the financial position of Company and
Company as at March 31, 1998, as adjusted as described in this clause (v),
assuming that such events had occurred at such date.
N. Insurance Appraisal; Evidence of Insurance. Administrative
Agent shall have received (i) a copy of the insurance report prepared by Aon
Risk Services with respect to Company and its Subsidiaries and such report shall
be in form and substance satisfactory to Agents, and (ii) satisfactory
certificates of insurance with respect to each of the insurance
policies required pursuant to subsection 6.4, and Agents shall be satisfied with
the nature and scope of these insurance policies.
O. Representations and Warranties; Performance of Agreements.
Company shall have delivered to Administrative Agent an Officer's Certificate,
in form and substance satisfactory to Administrative Agent, to the effect that
the representations and warranties in Section 5 hereof are true and correct in
all material respects on and as of the Effective Date to the same extent as
though made on and as of that date and that Company shall have performed in all
material respects all agreements and satisfied all conditions which this
Agreement provides shall be performed or satisfied by them on or before the
Effective Date, except as otherwise disclosed to and agreed to in writing by
Administrative Agent.
P. Completion of Proceedings. All corporate and other
proceedings taken or
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to be taken in connection with the transactions contemplated hereby and all
documents incidental thereto not previously found acceptable by
Administrative Agent, acting on behalf of Lenders, and their counsel shall be
satisfactory in form and substance to Administrative Agent and such counsel,
and Administrative Agent and such counsel shall have received all such
counterpart originals or certified copies of such documents as Administrative
Agent may reasonably request.
4.2 Conditions to All Loans.
The obligations of Lenders to make Loans on each Funding Date
are subject to the following further conditions precedent:
A. Administrative Agent shall have received on or before that
Funding Date, in accordance with the provisions of subsection 2.1B, an
originally executed Notice of Borrowing, signed by the chief executive officer,
the chief financial officer or the controller of Company or by any executive
officer of Company designated by any of the above-described officers on behalf
of Company in a writing delivered to Administrative Agent.
B. As of that Funding Date:
(i) The representations and warranties contained herein
and in the other Loan Documents shall be true and correct in all
material respects on and as of that Funding Date to the same extent as
though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date,
in which case such representations and warranties shall have been true
and correct in all material respects on and as of such earlier date;
(ii) No event shall have occurred and be continuing or
would result from the consummation of the borrowing contemplated by
such Notice of Borrowing that would constitute an Event of Default or a
Potential Event of Default;
(iii) Each Loan Party shall have performed in all material
respects all agreements and satisfied all conditions which this
Agreement and the other Loan Documents provide shall be performed or
satisfied by it on or before that Funding Date;
(iv) No order, judgment or decree of any court, arbitrator
or governmental authority shall purport to enjoin or restrain any
Lender from making the Loans to be made by it, on that Funding Date;
(v) The making of the Loans requested on such Funding Date
shall not violate any law including, without limitation, Regulation G,
Regulation T, Regulation U or Regulation X of the Board of Governors of
the Federal Reserve System; and
(vi) There shall not be pending or, to the knowledge of
Company, threatened, any action, suit, proceeding, governmental
investigation or arbitration against or affecting Company or any of its
Subsidiaries or any property of Company or any of its Subsidiaries that
has not been disclosed by Company in writing and that is required to be
so disclosed pursuant to subsection 5.6 or 6.1(x) prior to the making
of the last preceding
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Loans (or, in the case of the initial Loans, prior to the execution
of this Agreement), and there shall have occurred no development
not so disclosed in any such action, suit, proceeding,
governmental investigation or arbitration so disclosed that,
in either event, in the opinion of Administrative Agent or of
Requisite Lenders, would be expected to have a Material Adverse Effect;
and no injunction or other restraining order shall have been issued and
no hearing to cause an injunction or other restraining order to be
issued shall be pending or noticed with respect to any action, suit or
proceeding seeking to enjoin or otherwise prevent the consummation of,
or to recover any damages or obtain relief as a result of, the
transactions contemplated by this Agreement or the making of Loans
hereunder.
4.3 Conditions to Letters of Credit.
The issuance of any Letter of Credit hereunder (whether or not
the applicable Issuing Lender is obligated to issue such Letter of Credit) is
subject to the following conditions precedent:
A. On or before the date of issuance of the initial Letter of
Credit pursuant to this Agreement, the initial Loans shall have been made.
B. On or before the date of issuance of such Letter of Credit,
Administrative Agent shall have received, in accordance with the provisions of
subsection 3.1B(i), an originally executed Notice of Issuance of Letter of
Credit, signed by the chief executive officer, the chief financial officer or
the controller of Company or by any executive officer of Company designated by
any of the above-described officers on behalf of Company in a writing delivered
to Administrative Agent, together with all other information specified in
subsection 3.1B(i) and such other documents or information as the applicable
Issuing Lender may reasonably require in connection with the issuance of such
Letter of Credit.
C. On the date of issuance of such Letter of Credit, all
conditions precedent described in subsection 4.2B shall be satisfied to the same
extent as if the issuance of such Letter of Credit were the making of a Loan and
the date of issuance of such Letter of Credit were a Funding Date.
SECTION 5.
REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Agreement and to
make the Loans, to induce Issuing Lender to issue Letters of Credit and to
induce other Lenders to purchase participations therein, Company represents and
warrants to each Lender, on the date of this Agreement, on each Funding Date,
and on the date of issuance of each Letter of Credit, that the following
statements are true and correct:
5.1 Organization, Powers, Qualification, Good Standing, Business
and Subsidiaries.
A. Organization and Powers. Each Loan Party is a corporation
duly organized, validly existing and in good standing under the laws of its
state of incorporation. Each
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Loan Party has all requisite corporate power and authority to own and operate
its properties, to carry on its business as now conducted and as proposed to
be conducted, to enter into the Loan Documents and to carry out the
transactions contemplated thereby. Company has all requisite corporate power
and authority to issue and pay the Notes.
B. Qualification and Good Standing. Each Loan Party is
qualified to do business and in good standing in every jurisdiction where its
assets are located and wherever necessary to carry out its business and
operations, except in jurisdictions where the failure to be so qualified,
authorized or in good standing has not had and will not have a Material Adverse
Effect.
C. Conduct of Business. Company and its Subsidiaries are
engaged only in the businesses permitted to be engaged in pursuant to subsection
7.11.
D. Company and Subsidiaries. All of the Subsidiaries of
Company as of the Effective Date after giving effect to the Transaction are
identified in Schedule 5.1 annexed hereto. The capital stock of each of the
Subsidiaries of Company identified in Schedule 5.1 annexed hereto is duly
authorized, validly issued, fully paid and nonassessable and none of such
capital stock constitutes Margin Stock. Company and each of the Subsidiaries
of Company identified in Schedule 5.1 annexed hereto are duly organized,
validly existing and in good standing under the laws of their respective
jurisdictions of incorporation or formation set forth therein, have full
corporate power and authority to own their assets and properties and to
operate their business as presently owned and conducted and as proposed to be
conducted, and are qualified to do business and in good standing in every
jurisdiction where their assets are located and wherever necessary to carry
out their business and operations, in each case except where failure to be so
qualified or in good standing or a lack of such corporate power and authority
has not had and will not have a Material Adverse Effect. Schedule 5.1 annexed
hereto correctly sets forth the ownership interest of Company in each of its
Subsidiaries identified therein.
E. Acquisitions. Each Loan Party shall have, upon consummation
thereof, all requisite corporate power and authority to consummate, on the terms
set forth in the applicable acquisition agreement and related documents, each
Permitted Acquisition consummated by it pursuant to subsection 7.7(vi). Upon
consummation of any such Permitted Acquisition, such Permitted Acquisition shall
have been duly authorized by all necessary corporate action of such Loan Party.
5.2 Authorization of Borrowing, etc.
A. Authorization of Borrowing. The execution, delivery and
performance of the Loan Documents and the Related Agreements and the issuance,
delivery and payment of the Notes have been duly authorized by all necessary
corporate or other action on the part of each of the Loan Parties thereto.
B. No Conflict. After giving effect to the consummation of the
transactions contemplated hereby to occur on the Effective Date, the execution,
delivery and performance by each of the Loan Parties of the Loan Document and
the Related Agreements to which they are parties, the issuance, delivery and
payment of the Notes and the consummation of the
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transactions contemplated by the Loan Documents do not and will not (i)
violate any provision of any law or any governmental rule or regulation
applicable to Company or any of its Subsidiaries, the Certificate or Articles
of Incorporation or Bylaws (or other analogous organizational document) of
any Loan Party or any of its Subsidiaries or any order, judgment or decree of
any court or other agency of government binding on any Loan Party or any of
its Subsidiaries, (ii) conflict with, result in a breach of or constitute
(with due notice or lapse of time or both) a default under any Contractual
Obligation of any Loan Party or any of its Subsidiaries, (iii) result in or
require the creation or imposition of any Lien upon any of the properties or
assets of any Loan Party or any of its Subsidiaries (other than any Liens
created under any of the Loan Documents in favor of Administrative Agent on
behalf of Lenders), or (iv) require any approval of stockholders or partners
or any approval or consent of any Person under any Contractual Obligation of
any Loan Party or any of its Subsidiaries, except for such approvals or
consents which will be obtained on or before the Effective Date.
C. Governmental Consents. The execution, delivery and
performance by the Loan Parties of the Loan Documents and Related Agreements to
which they are party, the issuance, delivery and payment of the Notes and the
consummation of the transactions contemplated by the Loan Documents do not and
will not require any registration with, consent or approval of, or notice to, or
other action to, with or by, any federal, state or other governmental authority
or regulatory body except for such registrations, consents, approvals,
notices or other actions which will be made, obtained or taken on or before the
Effective Date.
D. Binding Obligation. Each of the Loan Documents and the
Related Agreements has been duly executed and delivered by each of the Loan
Parties party thereto and is the legally valid and binding obligation of each
such Loan Party, enforceable against such Loan Party in accordance with its
respective terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or limiting creditors'
rights generally or by equitable principles relating to enforceability.
E. Valid Issuance of Company Common Stock and
Subordinated Notes.
(i) Company Common Stock. The Company Common Stock to be sold on or
before the Effective Date, when issued and delivered, will be duly and validly
issued, fully paid and nonassessable. The issuance and sale of such Company
Common Stock, upon such issuance and sale, will either (a) have been registered
or qualified under applicable federal and state securities laws or (b) be exempt
therefrom.
(ii) Subordinated Notes. Company has the corporate power and
authority to issue the Subordinated Notes. The Subordinated Notes are the
legally valid and binding obligations of Company, enforceable against Company in
accordance with their respective terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to or limiting
creditors' rights generally or by equitable principles relating to
enforceability. The subordination provisions of the Subordinated Note
Indentures, the Subordinated Notes and the other Subordinated Note Documents are
enforceable against the holders of the Subordinated Notes, and the Loans and all
other monetary Obligations hereunder are and will be within the definition of
"Senior Indebtedness" included in such provisions. The Subordinated Notes (a)
have been registered or qualified under applicable federal and state
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securities laws or (b) are exempt therefrom.
5.3 Financial Condition.
A. Financial Statements. Company has heretofore delivered
to Lenders, at Lenders' request, the following financial statements and
information: (i) the balance sheets of Holdings as at December 27, 1997 and
March 28, 1998 and the related unaudited statements of income and changes in
stockholder's equity and of cash flows of Holdings for the period from
December 27, 1997 through March 28, 1998, and (ii) the audited statements of
operations and changes in stockholder's equity and cash flows of VDK Holdings
as at June 30, 1997 and the related unaudited statements of operations and
cash flows of VDK Holdings as at March 31, 1998 for the nine months then
ended, copies of which have heretofore been furnished to each Lender, present
fairly in all respects the financial condition of Holdings and VDK Holdings
as at such dates (subject to normal year-end audit adjustments). All such
financial statements have been prepared in accordance with GAAP consistently
applied throughout the period presented. At the date of the most recent
balance sheet referred to above, Company did not have any material liability
or material obligation which would be required to be included in the
financial statements referred to in this subsection in accordance with GAAP
which was not so included. Except as reflected in the financial statements
referred to in this subsection 5.3 and except for the Transaction, during the
period from December 31, 1997 to and including the date hereof there has been
no sale, transfer or other disposition by any Loan Party of any material part
of its business or property, no material liabilities were incurred by any
Loan Party and there has been no purchase or other acquisition of any
business or property by any Loan Party material in relation to the financial
condition of Company at December 31, 1997.
5.4 No Material Adverse Change; No Restricted Junior Payments.
Since December 31, 1997, no event or change has occurred that
has caused or evidences, either in any case or in the aggregate, a Material
Adverse Effect. Neither Company nor any of its Subsidiaries has directly or
indirectly declared, ordered, paid or made, or set apart any sum or property
for, any Restricted Junior Payment or agreed to do so except as permitted by
subsection 7.5.
5.5 Title to Properties; Liens; Intellectual Property.
A. Company and its Subsidiaries have good, sufficient and
legal title to all of their respective properties and assets reflected in the
financial statements referred to in subsection 5.3 or in the most recent
financial statements delivered pursuant to subsection 6.1, except for assets
disposed of since the date of such financial statements in the ordinary course
of business or as otherwise permitted under subsection 7.7.
Except as permitted by this Agreement, all such properties and
assets are free and clear of Liens.
B. Company has acquired, pursuant to the Acquisition
Agreement, that which Seller has represented is the ownership of all patents,
copyrights (whether registered or unregistered), trademarks (whether registered
or unregistered), trade names, trade dress, service
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marks, assumed names and know-how (such items, together with all applications
therefor and all other intellectual property and proprietary rights, whether
or not subject to statutory registration or protection, being collectively
referred to herein as "MBW Intellectual Property") relating exclusively to,
or used exclusively in connection with, the Business which (i) are owned by
Seller on December 31, 1996 and (ii) are necessary, together with the rights
licensed to Company under the Shared Technology License Agreement and the
Patent License Agreement, for the operation of the Business as conducted on
the Closing Date, except as set forth on Schedule 5.5B annexed hereto;
provided, however, that such MBW Intellectual Property does not include any
rights to the brand name "Country Crock," "Pennant" or "Bakers Source."
C. Company has acquired, pursuant to the Log Cabin
Acquisition Agreement, that which Kraft has represented is the ownership of
all patents, copyrights (whether registered or unregistered), trademarks
(whether registered or unregistered), trade names, trade dress, service
marks, assumed names and know-how (such items, together with all applications
therefor and all other intellectual property and proprietary rights, whether
or not subject to statutory registration or protection, being collectively
referred to herein as "Log Cabin Intellectual Property") relating exclusively
to, or used exclusively in connection with, the Log Cabin Business which (i)
are owned by Kraft on July 1, 1997 and (ii) are necessary, together with the
rights licensed to Company under the Log Cabin Patent License Agreement, for
the operation of the Log Cabin Business as conducted on July 1, 1997, except
as set forth on Schedule 5.5C annexed hereto.
D. Company has acquired, pursuant to the Xxxxxx Xxxxx
Acquisition Agreement, that which P&G has represented is the ownership of all
patents, copyrights (whether registered or unregistered), trademarks (whether
registered or unregistered), trade names, trade dress, service marks, assumed
names and know-how (such items, together with all applications therefor and all
other intellectual property and proprietary rights, whether or not subject to
statutory registration or protection, being collectively referred to herein as
"Xxxxxx Xxxxx Intellectual Property") relating exclusively to, or used
exclusively in connection with, the Xxxxxx Xxxxx Business which (i) are owned by
P&G on January 16, 1998 and (ii) are necessary, together with the rights
licensed to Company under the Xxxxxx Xxxxx Patent License Agreement, for the
operation of the Xxxxxx Xxxxx Business as conducted on the Effective Date,
except as set forth on Schedule 5.5D annexed hereto.
E. Company has acquired all patents, copyrights (whether
registered or unregistered), trademarks (whether registered or unregistered),
trade names, trade dress, service marks, assumed names and know-how (such items,
together with all applications therefor and all other intellectual property and
proprietary rights, whether or not subject to statutory registration or
protection, being collectively referred to as "Van xx Xxxx'x Intellectual
Property") necessary for the operation of Van xx Xxxx'x as conducted on the
Effective Date, except as set forth on Schedule 5.5E annexed hereto.
F. Each Loan Party owns, or is licensed to use, all
Intellectual Property necessary for the operation of its business as conducted
except for Intellectual Property the failure to own or license which could not
reasonably be expected to have a Material Adverse Effect. No claim of which any
Loan Party has been given notice has been asserted and is pending by any Person
challenging or questioning the use by any Loan Party of any such Intellectual
Property the validity or effectiveness of any such Intellectual Property, nor
does
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Company know of any valid basis for any such claim, except for such claims
that in the aggregate could not reasonably be expected to have a Material
Adverse Effect.
5.6 Litigation: Adverse Facts.
There is no action, suit, proceeding, arbitration or
governmental investigation (whether or not purportedly on behalf of Company or
any of its Subsidiaries) at law or in equity or before or by any federal, state,
municipal or other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, pending or, to the knowledge of Company,
threatened against or affecting Company or any of its Subsidiaries or
any property of Company or any of its Subsidiaries that, either individually or
in the aggregate together with all other such actions, proceedings and
investigations, has had, or could reasonably be expected to result in, a
Material Adverse Effect. Neither Company nor any of its Subsidiaries is or has
been (i) in violation of any applicable law (including any Pure Food and Drug
Laws that has had, or could reasonably be expected to result in, a Material
Adverse Effect or (ii) subject to or in default with respect to any final
judgment, writ, injunction, decree, rule or regulation of any court or any
federal, state, municipal or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, that has had, or could
reasonably be expected to result in, a Material Adverse Effect.
5.7 Payment of Taxes.
Except to the extent permitted by subsection 6.3, all material
tax returns and reports of Company and its Subsidiaries required to be filed by
any of them have been timely filed, and all material taxes, assessments, fees
and other governmental charges upon Company and its Subsidiaries and upon their
respective properties, assets, income, businesses and franchises which are due
and payable have been paid when due and payable. Company does not know of any
proposed tax assessment against Company or any of its Subsidiaries other than
those which are being actively contested by Company or such Subsidiary in good
faith and by appropriate proceedings and for which reserves or other appropriate
provisions, if any, as may be required in conformity with GAAP shall have been
made or provided therefor.
5.8 Performance of Agreements; Materially Adverse Agreements;
Material Contracts.
A. Neither Company nor any of its Subsidiaries is in default
in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any of its Contractual Obligations, and no
condition exists that, with the giving of notice or the lapse of time or both,
would constitute such a default, except where the consequences, direct or
indirect, of such default or defaults, if any, would not have a Material Adverse
Effect.
B. Neither Company nor any of its Subsidiaries is a party to
or is otherwise subject to any agreement or instrument or any charter or other
internal restriction which has had, or could reasonably be expected (based upon
assumptions that are reasonable at the time made) to result in, individually or
in the aggregate, a Material Adverse Effect.
C. Schedule 5.8 contains a true, correct and complete list of
all the Material
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Contracts in effect on the Effective Date. All such Material Contracts are in
full force and effect and no defaults currently exist thereunder, except
where the failure to be in full force and effect, and except for such
defaults which, could not reasonably be expected to have a Material Adverse
Effect.
5.9 Governmental Regulation.
Neither Company nor any of its Subsidiaries is subject to
regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act or the Investment Company Act of 1940 or
under any other federal or state statute or regulation which may limit its
ability to incur Indebtedness or which may otherwise render all or any portion
of the Obligations unenforceable.
5.10 Securities Activities.
Neither Company nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying any Margin Stock.
5.11 Employee Benefit Plans.
A. Company and each of its ERISA Affiliates are in substantial
compliance with all applicable provisions and requirements of ERISA with respect
to each Employee Benefit Plan, and have substantially performed all their
obligations under each Employee Benefit Plan, except to the extent that any
non-compliance with ERISA or any such failure to perform would not result in
material liability of Company or any of its ERISA Affiliates.
B. No ERISA Event has occurred which has resulted or is
reasonably likely to result in any material liability to the PBGC or to any
other Person.
C. Except to the extent required under Section 4980B of the
Internal Revenue Code and/or Section 601 of ERISA, neither Company nor any of
its Subsidiaries maintains or contributes to any employee welfare benefit plan
(as defined in Section 3(1) of ERISA) that provides health or welfare benefits
(through the purchase of insurance or otherwise) for any retired or former
employees of Company or any of its Subsidiaries, except to the extent that the
provision of such benefits would not have a Material Adverse Effect.
D. No Pension Plan has an Unfunded Current Liability in an
amount that would have a Material Adverse Effect.
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5.12 Certain Fees.
No broker's or finder's fee or commission will be payable with
respect to this Agreement or any of the loan transactions contemplated hereby,
and Company hereby indemnifies Lenders against, and agrees that it will hold
Lenders harmless from, any claim, demand or liability for any such broker's or
finder's fees alleged to have been incurred in connection herewith or therewith
and any expenses (including reasonable fees, expenses and disbursements of
counsel) arising in connection with any such claim, demand or liability.
5.13 Environmental Protection.
(i) The operations of Company and each of its Subsidiaries
(including, without limitation, all operations and conditions at or in the
Facilities) comply in all material respects with all Environmental Laws;
(ii) Company and each of its Subsidiaries have obtained all material
Governmental Authorizations under Environmental Laws necessary to their
respective operations, and all such Governmental Authorizations are in good
standing, and Company and each of its Subsidiaries are in compliance with all
material terms and conditions of such Governmental Authorizations;
(iii) Neither Company nor any of its Subsidiaries has received (a)
any notice or claim to the effect that it is or may be liable to any Person as a
result of or in connection with any Hazardous Materials or (b) any letter or
request for information under Section 104 of the Comprehensive Environmental
Response, Compensation, and Liability Act (42 U.S.C. ss. 9604) or comparable
state laws, and, to the best knowledge of Company, none of the operations of
Company or any of its Subsidiaries is the subject of any federal or state
investigation relating to or in connection with any Hazardous Materials at any
Facility or at any other location;
(iv) None of the operations of Company or any of its Subsidiaries is
subject to any judicial or administrative proceeding alleging the violation of
or liability under any Environmental Laws which could reasonably be expected to
have a Material Adverse Effect;
(v) To the knowledge of Company, neither Company nor any of its
Subsidiaries nor any of their respective Facilities or operations are subject to
any outstanding written order or agreement with any governmental authority or
private party relating to (a) any Environmental Laws or (b) any Environmental
Claims that could reasonably be expected to have a Material Adverse Effect;
(vi) Neither Company nor any of its Subsidiaries has any material
contingent liability in connection with any Release of any Hazardous Materials
by Company or any of its Subsidiaries;
(vii) Neither Company nor any of its Subsidiaries nor, to the
knowledge of Company, any predecessor of Company or any of its Subsidiaries has
filed any notice under any Environmental Law indicating past or present
treatment or Release of Hazardous Materials at any Facility, and none of
Company's or any of its Subsidiaries' operations involves the generation,
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transportation, treatment, storage or disposal of hazardous waste, as defined
under 40 C.F.R. Parts 260-270 or any state equivalent;
(viii) To the knowledge of Company, no Hazardous Materials exist on or
under any Facility in a manner that has a reasonable possibility of giving rise
to an Environmental Claim having a Material Adverse Effect, and neither Company
nor any of its Subsidiaries has filed any notice or report of a Release of any
Hazardous Materials that has a reasonable possibility of giving rise to an
Environmental Claim having a Material Adverse Effect;
(ix) Neither Company nor any of its Subsidiaries nor, to the
knowledge of Company, any of their respective predecessors has disposed of any
Hazardous Materials in a manner that has a reasonable possibility of giving rise
to an Environmental Claim having a Material Adverse Effect;
(x) To the knowledge of Company, no underground storage tanks or
surface impoundments are on or at any Facility; and
(xi) To the knowledge of Company, no Lien in favor of any Person
relating to or in connection with any Environmental Claim has been filed or has
been attached to any Facility.
5.14 Employee Matters.
There is no strike or work stoppage in existence or threatened
involving Company or any of its Subsidiaries that could reasonably be expected
to have a Material Adverse Effect.
5.15 Solvency.
Each Loan Party is, and Company and its Subsidiaries, taken as
a whole, are, and, upon the incurrence of any Obligations by any Loan Party on
any date on which this representation is made, will be, Solvent.
5.16 Matters Relating to Collateral.
A. Creation, Perfection and Priority of Liens. The execution
and delivery of the Collateral Documents by the Loan Parties, together with (i)
the actions taken on or prior to the date hereof pursuant to subsections 4.1,
6.9 and 6.10 and (ii) the delivery to Administrative Agent of any Pledged
Collateral not delivered to Administrative Agent at the time of execution and
delivery of the applicable Collateral Document (all of which Pledged Collateral
has been so delivered) are effective to create in favor of Administrative Agent
for the benefit of Agents and Lenders, as security for the respective Secured
Obligations (as defined in the applicable Collateral Document in respect of any
Collateral), a valid and perfected First Priority Lien on all of the Collateral,
and all filings and other actions necessary or desirable to perfect and maintain
the perfection and First Priority status of such Liens have been duly made or
taken and remain in full force and effect, other than the filing of any UCC
financing statements delivered to Administrative Agent for filing (but not yet
filed) and the periodic filing of UCC continuation statements in respect of UCC
financing statements filed by or on behalf of Administrative Agent.
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B. Governmental Authorizations. No authorization, approval
or other action by, and no notice to or filing with, any governmental
authority or regulatory body is required for either (i) the pledge or grant
by any Loan Party of the Liens purported to be created in favor of
Administrative Agent pursuant to any of the Collateral Documents or (ii) the
exercise by Administrative Agent of any rights or remedies in respect of any
Collateral (whether specifically granted or created pursuant to any of the
Collateral Documents or created or provided for by applicable law), except
for filings or recordings contemplated by subsection 5.16A and except as may
be required, in connection with the disposition of any Pledged Collateral, by
laws generally affecting the offering and sale of securities.
C. Absence of Third-Party Filings. Except such as may have
been filed in favor of Administrative Agent as contemplated by subsection 5.16A,
(i) no effective UCC financing statement, fixture filing or other instrument
similar in effect covering all or any part of the Collateral is on file in any
filing or recording office and (ii) no effective filing covering all or any part
of the IP Collateral is on file in the PTO or the United States Copyright
Office.
D. Margin Regulations. The pledge of the Pledged Collateral
pursuant to the Collateral Documents does not violate Regulation T, Regulation U
or Regulation X of the Board of Governors of the Federal Reserve System.
E. Information Regarding Collateral. All information supplied
to any Agent by or on behalf of any Loan Party with respect to any of the
Collateral (in each case taken as a whole with respect to any particular
Collateral) is accurate and complete in all material respects.
5.17 Related Agreements.
Company has delivered to Administrative Agent complete and
correct copies of each Related Agreement and of all exhibits and schedules
thereto.
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5.18 Disclosure.
The representations of Company and its Subsidiaries
contained in the Loan Documents, the Related Agreements and in any other
document, certificate or written statement furnished to Lenders by or on
behalf of Company or any of its Subsidiaries for use in connection with the
transactions contemplated by this Agreement, when taken as a whole, do not
contain any untrue statement of a material fact or omit to state a material
fact (known to Company or the applicable Subsidiary, in the case of any
document not furnished by Company or such Subsidiary) necessary in order to
make the statements contained herein or therein not misleading in light of
the circumstances in which the same were made. Any projections and pro forma
financial information contained in such materials are based upon good faith
estimates and assumptions believed by Company to be reasonable at the time
made, it being recognized by Lenders that such projections as to future
events are not to be viewed as facts and that actual results during the
period or periods covered by any such projections may differ from the
projected results. There is no fact known (or which should upon the
reasonable exercise of diligence be known) to Company (other than matters of
a general economic nature) that has had, or could reasonably be expected to
result in, a Material Adverse Effect and that has not been disclosed herein
or in such other documents, certificates and statements furnished to Lenders
for use in connection with the transactions contemplated hereby.
5.19 Subordination of Seller Notes.
The subordination provisions of any Permitted Seller Notes, if
any, will be enforceable against the holders thereof, and the Loans and other
monetary obligations hereunder are and will be within the definition of "Senior
Indebtedness" included in such provisions.
5.20 Year 2000 Matters.
Any reprogramming required to permit the proper functioning
(but only to the extent that such proper functioning would otherwise be impaired
by the occurrence of the year 2000) in and following the year 2000 of computer
systems and other equipment containing embedded microchips, in either case owned
or operated by Company or any of its Subsidiaries or used or relied upon in the
conduct of their business (including any such systems and other equipment
supplied by others or with which the computer systems of Company or any of its
Subsidiaries interface), and the testing of all such systems and other equipment
as so reprogrammed, will be completed by September 30, 1999. The costs to
Company and its Subsidiaries that have not been incurred as of the date hereof
for such reprogramming and testing and for the other reasonably foreseeable
consequences to them of any improper functioning of other computer systems and
equipment containing embedded microchips due to the occurrence of the year 2000
are not expected to result in a Default or Event of Default or to have a
Material Adverse Effect. Except for any reprogramming referred to above, the
computer systems of Company and its Subsidiaries are and, with ordinary course
upgrading and maintenance, will continue for the term of this Agreement to be,
sufficient for the conduct of their business as currently conducted.
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SECTION 6.
AFFIRMATIVE COVENANTS
Company covenants and agrees that, so long as any of the
Commitments hereunder shall remain in effect and until payment in full of all of
the Loans and other obligations and the cancellation or expiration of all
Letters of Credit, unless Requisite Lenders shall otherwise give prior written
consent, Company shall perform, and shall cause each of its Subsidiaries to
perform, all covenants in this Section 6.
6.1 Financial Statements and Other Reports.
Company will maintain, and cause each of its Subsidiaries to
maintain, a system of accounting established and administered in accordance with
sound business practices to permit preparation of financial statements in
conformity with GAAP. Company will deliver to Administrative Agent (and
Administrative Agent will, after receipt thereof, deliver to each Lender):
(i) Monthly Financials: (a) as soon as available after
fiscal month-end July 1998 and August 1998 and (b) as soon as available
and in any event within 30 days after each fiscal month-end (other than
March, June, September and December) thereafter, the consolidated and
consolidating statements of income (through the "Earnings Before Tax"
line) of Company and its Subsidiaries for such fiscal month and for the
period from the beginning of the then current Fiscal Year to the end of
such month, setting forth in each case in comparative form the
corresponding figures for the corresponding periods of the previous
fiscal year and the corresponding figures from the consolidated plan
and financial forecast for the current Fiscal Year delivered pursuant
to subsection 6.1(xiii), all in reasonable detail and certified by the
chief financial officer of Company as being fairly stated in all
material respects, subject to changes resulting from audit and normal
year-end adjustments;
(ii) Quarterly Financials: as soon as available and in any
event within 45 days after the end of each Fiscal Quarter, (a) the
consolidated and consolidating balance sheets of Company and its
Subsidiaries as at the end of such Fiscal Quarter and the related
consolidated and consolidating statements of income, stockholders'
equity and cash flows of Company and its Subsidiaries for such Fiscal
Quarter and for the period from the beginning of the then current
Fiscal Year to the end of such Fiscal Quarter, setting forth in each
case in comparative form the corresponding figures for the
corresponding periods of the previous fiscal year and the corresponding
figures from the consolidated plan and financial forecast for the
current Fiscal Year delivered pursuant to subsection 6.1(xiii), all in
reasonable detail and certified by the chief financial officer of
Company that they fairly present, in all material respects, the
financial condition of Company and its Subsidiaries as at the dates
indicated and the results of their operations and their cash flows for
the periods indicated, subject to changes resulting from audit and
normal year-end adjustments, and (b) a narrative report describing the
operations of Company and its Subsidiaries in the form prepared for
presentation to senior management for such Fiscal Quarter and for the
period from the beginning of the then current Fiscal Year to the end of
such Fiscal Quarter;
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(iii) Year-End Financials: as soon as available and in any
event within 90 days after the end of each Fiscal Year, (a) the
consolidated and consolidating balance sheets of Company and its
Subsidiaries as at the end of such Fiscal Year and the related
consolidated and consolidating statements of income, stockholders'
equity and cash flows of Company and its Subsidiaries for such Fiscal
Year, setting forth in each case in comparative form the corresponding
figures for the previous fiscal year and the corresponding
figures from the consolidated plan and financial forecast
delivered pursuant to subsection 6.1(xiii) for the Fiscal Year covered
by such financial statements, all in reasonable detail and certified by
the chief financial officer of Company that they fairly present, in all
material respects, the financial condition of Company and its
Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated, (b) a
narrative report describing the operations of Company and its
Subsidiaries in the form prepared for presentation to senior management
for such Fiscal Year, and (c) in the case of such consolidated
financial statements, a report thereon of independent certified public
accountants of recognized national standing selected by Company and
reasonably satisfactory to Administrative Agent, which report shall be
unqualified as to the ability of Company and its Subsidiaries to
continue as a going concern and as to scope of audit, and shall state
that such consolidated financial statements fairly present, in all
material respects, the consolidated financial position of Company and
its Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated in conformity
with GAAP applied on a basis consistent with prior years (except as
otherwise disclosed in such financial statements) and that the
examination by such accountants in connection with such consolidated
financial statements has been made in accordance with generally
accepted auditing standards;
(iv) Officer's and Compliance Certificates: together with
each delivery of financial statements of Company and its Subsidiaries
pursuant to subdivisions (ii) and (iii) above, (a) an Officer's
Certificate of Company stating that the signer has reviewed the terms
of this Agreement and have made, or caused to be made under their
supervision, a review in reasonable detail of the transactions and
condition of Company and its Subsidiaries during the accounting period
covered by such financial statements and that such review has not
disclosed the existence during or at the end of such accounting period,
and that the signer does not have knowledge of the existence as at the
date of such Officer's Certificate, of any condition or event that
constitutes an Event of Default or Potential Event of Default, or, if
any such condition or event existed or exists, specifying the nature
and period of existence thereof and what action Company has taken, is
taking and proposes to take with respect thereto; and (b) a Compliance
Certificate demonstrating in reasonable detail compliance during and at
the end of the applicable accounting periods with the restrictions
contained in Section 7, in each case to the extent compliance with such
restrictions is required to be tested during or at the end of the
applicable accounting period;
(v) Reconciliation Statements: if, as a result of any
change in accounting principles and policies from those used in the
preparation of the audited financial statements referred to in
subsection 5.3, the consolidated financial statements of
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Company and its Subsidiaries delivered pursuant to subdivisions
(i), (ii), (iii) or (xiii) of this subsection 6.1 will differ
in any material respect from the consolidated financial
statements that would have been delivered pursuant to
such subdivisions had no such change in accounting
principles and policies been made, then (a) together with the first
delivery of financial statements pursuant to subdivision (i), (ii),
(iii) or (xiii) of this subsection 6.1 following such change,
consolidated financial statements of Company and its
Subsidiaries for (y) the current Fiscal Year to the effective
date of such change and (z) the two full Fiscal Years immediately
preceding the Fiscal Year in which such change is made, in each
case prepared on a pro forma basis as if such change had been
in effect during such periods, and (b) together with each delivery
of financial statements pursuant to subdivision (i), (ii), (iii) or
(xiii) of this subsection 6.1 following such change, a written
statement of the chief accounting officer or chief financial officer of
Company setting forth the differences which would have resulted if such
financial statements had been prepared without giving effect to such
change;
(vi) Accountants' Certification: together with each
delivery of consolidated financial statements of Company and its
Subsidiaries pursuant to subdivision (iii) above, a written statement
by the independent certified public accountants giving the report
thereon stating whether, in connection with their audit examination,
any condition or event, insofar as such condition or event relates to
the covenants set forth in subsection 7.6, that constitutes an Event of
Default or Potential Event of Default has come to their attention and,
if such a condition or event has come to their attention, specifying
the nature and period of existence thereof; provided that such
accountants shall not be liable by reason of any failure to obtain
knowledge of any such Event of Default or Potential Event of Default
that would not be disclosed in the course of their audit examination;
(vii) Accountants' Reports: promptly upon receipt thereof
(unless restricted by applicable professional standards), copies of all
reports submitted to Company by independent certified public
accountants in connection with each annual, interim or special audit of
the financial statements of Company and its Subsidiaries made by such
accountants, including, without limitation, any comment letter
submitted by such accountants to management in connection with their
annual audit;
(viii) SEC Filings and Press Releases: promptly upon their
becoming available, copies of (a) all financial statements, reports,
notices and proxy statements sent or made available generally by
Company to its security holders, (b) all regular and periodic reports
and all registration statements (other than on Form S-8 or a similar
form) and prospectuses, if any, filed by Company or any of its
Subsidiaries with any securities exchange or with the Securities and
Exchange Commission or any governmental or private regulatory
authority, and (c) all press releases and other statements made
available generally by Company or any of its Subsidiaries to the public
concerning material developments in the business of Company or any of
its Subsidiaries;
(ix) Events of Default, etc.: promptly upon any officer of
Company obtaining knowledge (a) of any condition or event that
constitutes an Event of Default or Potential Event of Default, or
becoming aware that any Lender has given any notice
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(other than to Administrative Agent) or taken any other action
with respect to a claimed Event of Default or Potential Event
of Default, (b) that any Person has given any notice to
Company or any of its Subsidiaries or taken any other
action with respect to a claimed default or event or condition of the
type referred to in subsection 8.2, (c) of any condition or event that
is required to be disclosed in a current report filed by Company with
the Securities and Exchange Commission on Form 8-K (Items 1, 2, 4, 5
and 6 of such Form as in effect on the date hereof) if Company were
required to file such reports under the Exchange Act, or (d) of the
occurrence of any event or change that has caused or evidences, either
in any case or in the aggregate, a Material Adverse Effect, an
Officer's Certificate specifying the nature and period of existence of
such condition, event or change, or specifying the notice given or
action taken by any such Person and the nature of such claimed Event of
Default, Potential Event of Default, default, event or condition, and
what action Company has taken, is taking and proposes to take with
respect thereto;
(x) Litigation or Other Proceedings: (a) promptly upon any
officer of Company obtaining knowledge of the institution of, or
non-frivolous threat of, any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration against or affecting Company or any of its Subsidiaries or
any property of Company or any of its Subsidiaries (collectively,
"Proceedings") not previously disclosed in writing by Company to
Lenders or Administrative Agent any material development in any
Proceeding that, in any case:
(1) if adversely determined, has a reasonable
possibility of giving rise to a Material Adverse Effect; or
(2) seeks to enjoin or otherwise prevent the
consummation of, or to recover any damages or obtain relief as
a result of, the transactions contemplated hereby;
written notice thereof together with such other information as may be
reasonably available to Company to enable Lenders and their counsel to
evaluate such matters; and (b) within 45 days after the end of each
Fiscal Quarter, a schedule of all Proceedings involving an alleged
liability of, or claims against or affecting, Company or any of its
Subsidiaries equal to or greater than $1,000,000 and promptly after
request by Administrative Agent such other information as may be
reasonably requested by Administrative Agent to enable Administrative
Agent and its counsel to evaluate any of such Proceedings;
(xi) ERISA Events: promptly upon becoming aware of the
occurrence of any ERISA Event that could reasonably be expected to
result in a material liability, a written notice specifying the nature
thereof, what action Company or any of its ERISA Affiliates has taken,
is taking or proposes to take with respect thereto and, when known, any
action taken or threatened by the Internal Revenue Service, the
Department of Labor or the PBGC with respect thereto;
(xii) ERISA Notices: with reasonable promptness, copies of
(a) all written notices received by Company or any of its ERISA
Affiliates from a
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Multiemployer Plan sponsor concerning an ERISA Event;
and (b) such other documents or governmental reports or filings
relating to any Employee Benefit Plan as Administrative Agent shall
reasonably request;
(xiii) Financial Plans: as soon as available and in any event
no later than 90 days after the beginning of Fiscal Year 1999, and
thereafter as soon as practicable and in any event no later than 60
days after the beginning of each subsequent Fiscal Year, a monthly
consolidated and consolidating plan and financial forecast for such
Fiscal Year, including, without limitation, (a) forecasted consolidated
and consolidating balance sheets and forecasted consolidated and
consolidating statements of income and cash flows of Company and its
Subsidiaries for such Fiscal Year, together with a pro forma Compliance
Certificate for such Fiscal Year and an explanation of the assumptions
on which such forecasts are based, and (b) such other information and
projections as Administrative Agent may reasonably request;
(xiv) Insurance: upon request by Administrative Agent, as
soon as practicable and in any event not less than once each Fiscal
Year, a report in form and substance satisfactory to Administrative
Agent outlining all material insurance coverage maintained as of the
date of such report by Company and its Subsidiaries and all material
insurance coverage planned to be maintained by Company and its
Subsidiaries in the immediately succeeding Fiscal Year;
(xv) Environmental Audits and Reports: as soon as
practicable following receipt thereof, copies of all environmental
audits and reports, whether prepared by personnel of Company or any of
its Subsidiaries or by independent consultants, with respect to
significant environmental matters at any Facility or which relate to an
Environmental Claim which could result in a Material Adverse Effect;
(xvi) Board of Directors: with reasonable promptness,
written notice of any change in the Board of Directors of Company;
(xvii) New Subsidiaries: promptly upon any Person becoming a
Subsidiary of Company, a written notice setting forth with respect to
such Person (a) the date on which such Person became a Subsidiary of
Company and (b) all of the data required to be set forth in Schedule
5.1 annexed hereto with respect to all Subsidiaries of Company (it
being understood that such written notice shall be deemed to supplement
Schedule 5.1 annexed hereto for all purposes of this Agreement); and
(xviii) Other Information: with reasonable promptness, such
other information and data with respect to Company or any of its
Subsidiaries as from time to time may be reasonably requested by
Administrative Agent.
6.2 Corporate Existence, etc.
Except as permitted under subsection 7.7, Company will, and
will cause each of its Subsidiaries to, at all times preserve and keep in full
force and effect its corporate existence and all rights and franchises material
to the business of Company and its Subsidiaries (on a
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consolidated basis).
6.3 Payment of Taxes and Claims; Tax Consolidation.
A. Company will, and will cause each of its Subsidiaries to,
pay all material taxes and all assessments and other governmental charges
imposed upon it or any of its properties or assets or in respect of any of its
income, businesses or franchises before any penalty accrues thereon, and all
claims (including, without limitation, claims for labor, services, materials and
supplies) for sums that have become due and payable and that by law have or may
become a Lien upon any of its properties or assets, prior to the time when any
penalty or fine shall be incurred with respect thereto; provided that no such
charge or claim need be paid if it is being contested in good faith by
appropriate proceedings timely instituted and diligently conducted and if such
reserve or other appropriate provision, if any, as shall be required in
conformity with GAAP shall have been made therefor.
B. Company will not, nor will it permit any of its
Subsidiaries to, file or consent to the filing of any consolidated income tax
return with any Person other than a Subsidiary consolidated with the Company.
6.4 Maintenance of Properties; Insurance.
Company will, and will cause each of its Subsidiaries to,
maintain or cause to be maintained in good repair, working order and condition,
ordinary wear and tear excepted, all material properties used or useful in the
business of Company and its Subsidiaries and from time to time will make or
cause to be made all appropriate repairs, renewals and replacements thereof.
Company will maintain or cause to be maintained, with financially sound and
reputable insurers, insurance with respect to its properties and business and
the properties and businesses of its Subsidiaries against loss or damage of the
kinds customarily carried or maintained under similar circumstances by
corporations of established reputation engaged in similar businesses. Each such
policy of casualty insurance covering damage to or loss of property shall name
Administrative Agent for the benefit of Agents and Lenders as the loss payee
thereunder for all losses, subject to application of proceeds as required by
subsection 2.4B(iii)(d), and shall provide for at least 30 days' prior written
notice to Administrative Agent of any modification or cancellation of such
policy.
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6.5 Inspection; Lender Meeting.
Company shall, and shall cause each of its Subsidiaries to,
permit any authorized representatives designated by any Agent or Lender to visit
and inspect any of the properties of Company or any of its Subsidiaries,
including its and their financial and accounting records, and to make copies and
take extracts therefrom, and to discuss its and their affairs, finances and
accounts with its and their officers independent public accountants,
all upon reasonable advance notice and at such reasonable times during normal
business hours and as often as may be reasonably requested. Without in any way
limiting the foregoing, Company will, upon the request of Administrative Agent,
participate in a meeting of Agents and Lenders once during each Fiscal Year to
be held at Company's corporate offices (or such other location as may be agreed
to by Company and Administrative Agent) at such time as may be agreed to by
Company and Administrative Agent.
6.6 Compliance with Laws, etc.
Company shall, and shall cause each of its Subsidiaries to,
comply with the requirements of all applicable laws, rules, regulations and
orders of any governmental authority (including all Pure Food and Drug Laws),
noncompliance with which could reasonably be expected to cause a Material
Adverse Effect.
6.7 Environmental Disclosure and Inspection.
A. Company shall, and shall cause each of its Subsidiaries to,
exercise all due diligence in order to comply and cause (i) all tenants under
any leases or occupancy agreements affecting any portion of the Facilities and
(ii) all other Persons on or occupying such property, to comply with all
Environmental Laws.
B. Company agrees that Administrative Agent may, from time to
time and in its reasonable discretion, retain, at Company's expense, an
independent professional consultant to review any report relating to Hazardous
Materials prepared by or for Company and to conduct its own investigation of any
Facility currently owned, leased, operated or used by Company or any of its
Subsidiaries, and Company agrees to use all reasonable efforts to obtain
permission for Administrative Agent's professional consultant to conduct its own
investigation of any such Facility previously owned, leased, operated or used by
Company or any of its Subsidiaries. Company shall use its reasonable efforts to
obtain for Administrative Agent and its agents, employees, consultants and
contractors the right, upon reasonable notice to Company, to enter into or on to
the Facilities currently owned, leased, operated or used by Company or any of
its Subsidiaries to perform such tests on such property as are reasonably
necessary to conduct such a review and/or investigation. Any such investigation
of any Facility shall be conducted, unless otherwise agreed to by Company and
Administrative Agent, during normal business hours and, to the extent reasonably
practicable, shall be conducted so as not to interfere with the ongoing
operations at any such Facility or to cause any damage or loss to any property
at such Facility. Company and Administrative Agent hereby acknowledge and agree
that any report of any investigation conducted at the request of Administrative
Agent pursuant to this subsection 6.7B will be obtained and shall be used by
Administrative Agent and Lenders for the purposes of Lenders' internal credit
decisions, to monitor and police the Loans and to protect Lenders'
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security interests, if any, created by the Loan Documents. Administrative
Agent agrees to deliver a copy of any such report to Company with the
understanding that Company acknowledges and agrees that (i) it will indemnify
and hold harmless each Agent and Lender from any costs, losses or liabilities
relating to any Loan Party's use of or reliance on such report, (ii) no Agent
nor any Lender makes any representation or warranty with respect to such
report, and (iii) by delivering such report to Company, no Agent nor any
Lender is requiring or recommending the implementation of any suggestions or
recommendations contained in such report.
C. Company shall promptly advise Administrative Agent in
writing and in reasonable detail of (i) any Release of any Hazardous Materials
required to be reported to any federal, state, local or foreign governmental or
regulatory agency under any applicable Environmental Laws, (ii) any and all
written communications with respect to any Environmental Claims that have a
reasonable possibility of giving rise to a Material Adverse Effect or with
respect to any Release of Hazardous Materials required to be reported to any
federal, state or local governmental or regulatory agency, (iii) any remedial
action taken by Company or any other Person in response to (x) any Hazardous
Materials on, under or about any Facility, the existence of which has a
reasonable possibility of resulting in an Environmental Claim having a Material
Adverse Effect, or (y) any Environmental Claim that could have a Material
Adverse Effect, (iv) Company's discovery of any occurrence or condition on any
real property adjoining or in the vicinity of any Facility that could cause such
Facility or any part thereof to be subject to any restrictions on the ownership,
occupancy, transferability or use thereof under any Environmental Laws, and (v)
any request for information from any governmental agency that suggests such
agency is investigating whether Company or any of its Subsidiaries may be
potentially responsible for a Release of Hazardous Materials.
D. Company shall promptly notify Administrative Agent of (i)
any proposed acquisition of stock, assets, or property by Company or any of its
Subsidiaries that could reasonably be expected to expose Company or any of its
Subsidiaries to, or result in, Environmental Claims that could have a Material
Adverse Effect or that could reasonably be expected to have a material adverse
effect on any Governmental Authorization then held by Company or any of its
Subsidiaries and (ii) any proposed action to be taken by Company or any of its
Subsidiaries to commence manufacturing, industrial or other similar operations
that could reasonably be expected to subject Company or any of its Subsidiaries
to additional laws, rules or regulations, including, without limitation, laws,
rules and regulations requiring additional environmental permits or licenses.
E. Company shall, at its own expense, provide copies of such
documents or information as Administrative Agent may reasonably request in
relation to any matters disclosed pursuant to this subsection 6.7.
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6.8 Company's Remedial Action Regarding Hazardous Materials.
Company shall promptly take, and shall cause each of its
Subsidiaries promptly to take, any and all necessary remedial action in
connection with the presence, storage, use, disposal, transportation or
Release of any Hazardous Materials on or under any Facility in order to
comply with all applicable Environmental Laws and Governmental Authorizations
unless the failure to so comply could not reasonably be expected to have a
Material Adverse Effect. In the event Company or any of its Subsidiaries
takes any remedial action with respect to any Hazardous Materials on or under
any Facility, Company or such Subsidiary shall conduct and complete such
remedial action in material compliance with all applicable Environmental
Laws, and in accordance with the policies, orders and directives of all
federal, state and local governmental authorities except when, and only to
the extent that, Company's or such Subsidiary's liability for such presence,
storage, use, disposal, transportation or Release of any Hazardous Materials
is being contested in good faith by Company or such Subsidiary.
6.9 Execution of Subsidiary Guaranty and Subsidiary Security
Agreements by Subsidiaries and Future Subsidiaries.
In the event that any Person becomes a Subsidiary of Company
after the date hereof, Company will promptly notify Administrative Agent of that
fact and cause each such Subsidiary to execute and deliver to Administrative
Agent a counterpart of the Subsidiary Guaranty, the Pledge Agreement and the
Security Agreement and a new patent and trademark agreement substantially
similar to the Patent and Trademark Security Agreement, the Log Cabin Patent and
Trademark Security Agreement, the Xxxxxx Xxxxx Patent and Trademark Security
Agreement and the Van xx Xxxx'x Patent and Trademark Security Agreement
(collectively, the "Subsidiary Security Agreements"), and to take all such
further actions and execute all such further documents and instruments as may be
required to grant and perfect in favor of Administrative Agent, for the benefit
of Lenders, a First Priority security interest in all of the personal property
assets of such Subsidiary described in the Subsidiary Security Agreements.
Company shall deliver to Administrative Agent, together with such Loan
Documents, (i) certified copies of such Subsidiary's Articles or Certificate of
Incorporation (or comparable constituent documents), together, if applicable,
with a good standing certificate from the Secretary of State of the jurisdiction
of its incorporation, each to be dated a recent date prior to their delivery to
Administrative Agent, (ii) a copy, if applicable, of such Subsidiary's Bylaws,
certified by its corporate secretary or an assistant corporate secretary as of a
recent date prior to their delivery to Administrative Agent, (iii) a certificate
executed by the secretary or an assistant secretary of such Subsidiary as to (a)
the incumbency and signatures of the officers of such Subsidiary executing the
Subsidiary Guaranty and to which such Subsidiary is a party and (b) the fact
that the attached resolutions of the Board of Directors of such Subsidiary
authorizing the execution, delivery and performance of the Subsidiary Guaranty
and the Subsidiary Security Agreements to which such Subsidiary is a party are
in full force and effect and have not been modified or rescinded, and (iv) a
favorable opinion of counsel to such Subsidiary, in form and substance
satisfactory to Administrative Agent and its counsel, as to (a) the due
organization and good standing of such Subsidiary, (b) the due authorization,
execution and delivery by such Subsidiary of the Subsidiary Guaranty and the
Subsidiary Security Agreements to which such Subsidiary is a party, (c) the
enforceability of the Subsidiary Guaranty and the Subsidiary Security Agreements
to which such Subsidiary is a party against such Subsidiary, and (d) such
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other matters as Administrative Agent may reasonably request, all of the
foregoing to be reasonably satisfactory in form and substance to
Administrative Agent and its counsel.
6.10 Conforming Leasehold Interests; Matters Relating to
Additional Real Property Collateral.
A. Conforming Leasehold Interests. If Company or any of its
Subsidiaries acquires any Leasehold Property, Company shall, or shall cause such
Subsidiary to, use its best efforts (without requiring Company or such
Subsidiary to relinquish any material rights or incur any material obligations
or to expend more than a nominal amount of money over and above the
reimbursement, if required, of the landlord's out-of-pocket costs, including
attorneys fees) to cause such Leasehold Property to be a Conforming Leasehold
Interest.
B. Additional Mortgages, etc. From and after the Closing Date,
in the event that (i) Company or any Subsidiary Guarantor acquires any fee
interest in real property or any Leasehold Property (other than a fee interest
in a Real Property Asset or Leasehold Property with a value of $500,000 or less)
or (ii) at the time any Person becomes a Subsidiary Guarantor, such Person owns
or holds any fee interest in real property or any Leasehold Property (other than
a fee interest in a Real Property Asset or Leasehold Property with a value of
$500,000 or less), in either case excluding any such Real Property Asset the
encumbrancing of which requires the consent of any applicable lessor or (in the
case of clause (ii) above) then-existing senior lienholder, where Company and
its Subsidiaries are unable to obtain such lessor's or senior lienholder's
consent (any such non-excluded Real Property Asset described in the foregoing
clause (i) or (ii) being a "Mortgaged Property"), Company or such Subsidiary
Guarantor shall deliver to Administrative Agent, as soon as practicable after
such Person acquires such Mortgaged Property or becomes a Subsidiary Guarantor,
as the case may be, the following:
(i) Additional Mortgage. A fully executed and notarized
Mortgage in proper form for recording in all appropriate places in all
applicable jurisdictions, encumbering the interest of such Loan Party
in such Mortgaged Property;
(ii) Opinions of Counsel. (a) A favorable opinion of
counsel to such Loan Party, in form and substance satisfactory to
Administrative Agent and its counsel, as to the due authorization,
execution and delivery by such Loan Party of such Mortgage and such
other matters as Administrative Agent may reasonably request, and (b)
if required by Administrative Agent, an opinion of counsel (which
counsel shall be reasonably satisfactory to Administrative Agent) in
the state in which such Mortgaged Property is located with respect to
the enforceability of the form of Mortgage to be recorded in such state
and such other matters (including any matters governed by the laws of
such state regarding personal property security interests in respect of
any Collateral) as Administrative Agent may reasonably request, in each
case in form and substance reasonably satisfactory to Administrative
Agent;
(iii) Landlord Consent and Estoppel; Recorded Leasehold
Interest. In the case of a Mortgaged Property consisting of a Leasehold
Property, (a) a Landlord Consent and Estoppel and (b) evidence that
such Leasehold Property is a Recorded Leasehold Interest;
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(iv) Title Insurance. (a) If required by Administrative
Agent, an ALTA mortgagee title insurance policy or an unconditional
commitment therefor (a "Mortgage Policy") issued by the Title Company
with respect to such Mortgaged Property, in an amount satisfactory to
Administrative Agent, insuring fee simple title to, or a valid
leasehold interest in, such Mortgaged Property vested in such Loan
Party and assuring Administrative Agent that such Mortgage creates a
valid and enforceable First Priority mortgage Lien on such Mortgaged
Property, subject only to a standard survey exception, which Mortgage
Policy (1) shall include an endorsement for mechanics' liens, for
future advances under this Agreement and for any other matters
reasonably requested by Administrative Agent and (2) shall provide for
affirmative insurance and such reinsurance as Administrative Agent may
reasonably request, all of the foregoing in form and substance
reasonably satisfactory to Administrative Agent; and (b) evidence
satisfactory to Administrative Agent that such Loan Party has (i)
delivered to the Title Company all certificates and affidavits required
by the Title Company in connection with the issuance of the Mortgage
Policy and (ii) paid to the Title Company or to the appropriate
governmental authorities all expenses and premiums of the Title Company
in connection with the issuance of the Mortgage Policy and all
recording and stamp taxes (including mortgage recording and intangible
taxes) payable in connection with recording the Mortgage in the
appropriate real estate records;
(v) Title Report. If no Mortgage Policy is required with
respect to such Mortgaged Property, a title report issued by the Title
Company with respect thereto, dated not more than 30 days prior to the
date such Mortgage is to be recorded and satisfactory in form and
substance to Administrative Agent;
(vi) Copies of Documents Relating to Title Exceptions.
Copies of all recorded documents listed as exceptions to title or
otherwise referred to in the Mortgage Policy or title report delivered
pursuant to clause (v) or (vi) above;
(vii) Matters Relating to Flood Hazard Properties. (a)
Evidence, which may be in the form of a letter from an insurance broker
or a municipal engineer, as to (1) whether such Mortgaged Property is a
Flood Hazard Property and (2) if so, whether the community in which
such Flood Hazard Property is located is participating in the National
Flood Insurance Program, (b) if such Mortgaged Property is a Flood
Hazard Property, such Loan Party's written acknowledgement of receipt
of written notification from Administrative Agent (1) that such
Mortgaged Property is a Flood Hazard Property and (2) as to whether the
community in which such Flood Hazard Property is located is
participating in the National Flood Insurance Program, and (c) in the
event such Mortgaged Property is a Flood Hazard Property that is
located in a community that participates in the National Flood
Insurance Program, evidence that Company has obtained flood insurance
in respect of such Flood Hazard Property to the extent required under
the applicable regulations of the Board of Governors of the Federal
Reserve System; and
(viii) Environmental Audit. If required by Administrative
Agent, reports and other information, in form, scope and substance
satisfactory to Administrative Agent
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and prepared by environmental consultants satisfactory to
Administrative Agent, concerning any environmental hazards
or liabilities to which Company or any of its Subsidiaries
may be subject with respect to such Mortgaged Property.
6.11 Interest Rate Protection.
Within 180 days after the Effective Date, Company shall enter
into one or more Interest Rate Agreements with respect to the Loans, in an
amount of not less than 50% of the aggregate amount of Consolidated Total Debt,
which Interest Rate Agreements shall have the effect of establishing a maximum
interest rate of not more than 10% per annum with respect to such notional
principal amount, each such Interest Rate Agreement to be in form and substance
satisfactory to Administrative Agent and with a term of not less than three
years from the Effective Date.
6.12 Further Assurances.
At any time or from time to time upon the request of
Administrative Agent, Company will, at its expense, promptly execute,
acknowledge and deliver such further documents and do such other acts and things
as Administrative Agent may reasonably request in order to effect fully the
purposes of the Loan Documents and to provide for payment of the Obligations in
accordance with the terms of this Agreement, the Notes and the other Loan
Documents. In furtherance and not in limitation of the foregoing, Company shall
take, and cause each of its Subsidiaries to take, such actions as Administrative
Agent may reasonably request from time to time (including, without limitation,
the execution and delivery of guaranties, security agreements, pledge
agreements, Mortgages, stock powers, financing statements and other documents,
the filing or recording of any of the foregoing, title insurance with respect to
any of the foregoing that relates to an interest in real property, the delivery
of stock certificates and other collateral with respect to which perfection is
obtained by possession, and the obtaining of Collateral Access Agreements, in
form and substance satisfactory to Administrative Agent, executed by any Person
which is party to a co-packing agreement with Company or any of its Subsidiaries
under which equipment of Company or its Subsidiaries is maintained at a facility
of such Person) to ensure that the Obligations are guarantied by Subsidiary
Guarantors and are secured by substantially all of the assets of Company and its
Subsidiaries and all of the capital stock of Company and Subsidiary Guarantors.
In the event that Company or any of its Subsidiaries creates a new Subsidiary,
all of the capital stock or partnership interests of such new Subsidiary shall
be duly and validly pledged to Administrative Agent for the benefit of Agents
and Lenders pursuant to the Collateral Documents, subject to no other Liens.
SECTION 7.
NEGATIVE COVENANTS
Company covenants and agrees that, so long as any of the
Commitments hereunder shall remain in effect and until payment in full of all of
the Loans and other Obligations and the cancellation or expiration of all
Letters of Credit, unless Requisite Lenders shall otherwise give prior written
consent, Company shall perform, and shall cause each of its Subsidiaries to
perform, all covenants in this Section 7.
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7.1 Indebtedness.
Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or guaranty, or
otherwise become or remain directly or indirectly liable with respect to, any
Indebtedness, except:
(i) Company may become and remain liable with respect
to the Obligations;
(ii) Company and its Subsidiaries may become and remain
liable with respect to Contingent Obligations permitted by subsection
7.4 and, upon any matured obligations actually arising pursuant
thereto, the Indebtedness corresponding to the Contingent Obligations
so extinguished (other than any such Indebtedness corresponding to
extinguished Contingent Obligations permitted under subsections
7.4(i)(b));
(iii) Company and its Subsidiaries may become and remain
liable with respect to Indebtedness (a) under Capital Leases
capitalized on the consolidated balance sheet of Company as
liabilities, (b) in respect of sale and lease-back transactions
expressly permitted under subsection 7.8 and (c) secured by Liens
permitted under subsection 7.2A(iii); provided that the aggregate
amount of Indebtedness permitted under this clause (iii) shall not
exceed $15,000,000 at any time outstanding;
(iv) Company may become and remain liable with respect
to Indebtedness to any of its domestic Wholly Owned Subsidiaries, and
any domestic Wholly Owned Subsidiary of Company may become and remain
liable with respect to Indebtedness to Company or any other domestic
Wholly Owned Subsidiary of Company, provided that (a) all such
intercompany Indebtedness shall be evidenced by promissory notes, (b)
all such intercompany Indebtedness owed by Company to any of its
respective Subsidiaries shall be subordinated in right of payment to
the payment in full of the Obligations pursuant to the terms of the
applicable promissory notes or an intercompany subordination agreement,
in each case in form and substance satisfactory to Administrative
Agent, and (c) any payment by Company or by any Subsidiary of Company
under any guaranty of the Obligations shall result in a pro tanto
reduction of the amount of any intercompany Indebtedness owed by
Company or by such Subsidiary to Company or to any of its
Subsidiaries for whose benefit such payment is made;
(v) Company may become and remain liable with respect
to Indebtedness under the Subordinated Note Documents;
(vi) Company may become and remain liable with respect
to Indebtedness the proceeds of which are applied to refinance all or a
portion of the Term Loans, the Revolving Loans and the Subordinated
Notes; provided, that such Indebtedness shall be subordinated in right
of payment to the Obligations pursuant to documentation containing
maturities, amortization schedules, covenants, defaults, remedies,
subordination provisions and other material terms which taken as a
whole are no less favorable to Company, its Subsidiaries and Lenders
than the corresponding terms of the Subordinated Note Documents, with
interest payable thereon in amounts consistent
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with the then prevailing rate in the market for comparable debt
Securities;
(vii) Company may become and remain liable with respect
to Permitted Seller Notes; provided that the aggregate principal amount
of such Permitted Seller Notes issued after the Closing Date shall not
exceed $10,000,000; and
(viii) Company and its Subsidiaries may become and remain
liable with respect to other Indebtedness in an aggregate principal
amount not to exceed at any time outstanding $25,000,000.
7.2 Liens and Related Matters.
A. Prohibition on Liens. Company shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly, create, incur, assume
or permit to exist any Lien on or with respect to any property or asset of any
kind (including any document or instrument in respect of goods or accounts
receivable) of Company or any of its Subsidiaries, whether now owned or
hereafter acquired, or any income or profits therefrom, or file or permit the
filing of, or permit to remain in effect, any financing statement, or other
similar notice of any Lien with respect to any such property, asset, income or
profits under the Uniform Commercial Code of any state or under any similar
recording or notice statute, except:
(i) Permitted Encumbrances;
(ii) Liens granted pursuant to the Collateral Documents;
(iii) Liens securing Indebtedness permitted by subsection
7.1(iii)(c) incurred (a) to finance the acquisition, construction or
improvement of any tangible personal property assets, provided that (1)
such Liens shall be created within 180 days after the acquisition,
construction or improvement of such assets, and (2) the principal
amount of Indebtedness secured by any such Liens shall at no time
exceed 100%, and the proceeds of such Indebtedness shall be used to
provide not less than 80%, of the original purchase price of
such asset or the amount expended to construct or improve
such asset, as the case may be; or (b) to renew, extend or
refinance any Indebtedness described in clause (a), provided
that the amount of any such Indebtedness does not exceed the amount of
Indebtedness so renewed, extended or refinanced which is unpaid and
outstanding immediately prior to such renewal, extension or
refinancing; provided, that in the case of clause (a) or (b) such Liens
attach solely the assets financed with such Indebtedness;
(iv) Liens on any asset securing Indebtedness permitted
by Section 7.1(iii)(b); provided that (a) the proceeds of such
Indebtedness shall be at least equal to 80% of the fair market value
(as determined in good faith by the Board of Directors, or any duly
authorized committee thereof, of Company) of such asset and (b) at the
time of incurrence of such Indebtedness, no Event of Default shall have
occurred and be continuing or would result therefrom;
(v) Liens on assets held under Capital Leases permitted
under
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subsection 7.1(iii)(a); and
(vi) Other Liens on assets of Company and its
Subsidiaries securing Indebtedness in an aggregate amount not to exceed
$2,500,000 at any time outstanding.
B. Equitable Lien in Favor of Lenders. If Company or any of
its Subsidiaries shall create or assume any consensual Lien upon any of its
properties or assets, whether now owned or hereafter acquired, other than Liens
excepted by the provisions of subsection 7.2A, it shall make or cause to be made
effective provision whereby the Obligations will be secured by such Lien equally
and ratably with any and all other Indebtedness secured thereby as long as any
such Indebtedness shall be so secured; provided that, notwithstanding the
foregoing, this covenant shall not be construed as a consent by Requisite
Lenders to the creation or assumption of any such Lien not permitted by the
provisions of subsection 7.2A.
C. No Further Negative Pledges. Except with respect to
specific property encumbered to secure payment of particular Indebtedness or to
be sold pursuant to an executed agreement with respect to an Asset Sale, neither
Company nor any of its Subsidiaries shall enter into any agreement prohibiting
the creation or assumption of any Lien upon any of its properties or assets,
whether now owned or hereafter acquired.
D. No Restrictions on Subsidiary Distributions to Company or
Other Subsidiaries. Except as provided herein Company will not, and will not
permit any of its Subsidiaries to, create or otherwise cause or suffer to exist
or become effective any consensual encumbrance or restriction of any kind on the
ability of any such Subsidiary to (i) pay dividends or make any other
distributions on any of such Subsidiary's capital stock owned by Company or any
other Subsidiary of Company, (ii) repay or prepay any Indebtedness owed by such
Subsidiary to Company or any other Subsidiary of Company, (iii)
make loans or advances to Company or any other Subsidiary of Company, or (iv)
transfer any of its property or assets to Company or any other Subsidiary of
Company.
7.3 Investments; Joint Ventures.
Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, make or own any Investment in any
Person, including any Joint Venture, except:
(i) Company and its Subsidiaries may make and own
Investments in Cash Equivalents;
(ii) Company and its Subsidiaries may make intercompany
loans to the extent permitted under subsection 7.1(iv);
(iii) Company and its Subsidiaries may make Consolidated
Capital Expenditures permitted by subsection 7.6D;
(iv) Company and its Subsidiaries may make and own
Investments in connection with a Permitted Acquisition;
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(v) Company and its Subsidiaries may make and own other
Investments in an aggregate amount not to exceed at any time
$7,500,000.
7.4 Contingent Obligations.
Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, create or become or remain liable with
respect to any Contingent Obligation, except:
(i) Subsidiaries of Company may become and remain
liable with respect to Contingent Obligations arising under (a) their
respective Guaranties and (b) guarantees of Indebtedness under the
Subordinated Note Documents or permitted under subsection 7.1(vi);
(ii) Company may become and remain liable with respect
to Contingent Obligations in respect of Letters of Credit;
(iii) Company may become and remain liable with respect
to Contingent Obligations under Interest Rate Agreements entered into
(a) with Lenders or Affiliates of Lenders with respect to which the
aggregate net amount which Company would be liable to pay to
counterparties thereunder in the event all such Interest Rate
Agreements were terminated at the time of determination shall not
exceed $2,500,000 at any time and (b) as required under subsection 6.11
herein;
(iv) Company and its Subsidiaries may become and remain
liable with respect to Contingent Obligations in respect of customary
indemnification and purchase price adjustment obligations incurred in
the ordinary course of business in connection with Asset Sales or other
sales of assets;
(v) Company and its Subsidiaries may become and remain
liable with respect to Contingent Obligations under guarantees in the
ordinary course of business of the obligations of suppliers, landlords,
customers, franchisees and licensees of Company and its Subsidiaries in
an aggregate amount not to exceed at any time $1,000,000;
(vi) Company and its Subsidiaries may become and remain
liable with respect to Contingent Obligations under food product
futures arrangements consistent with past practices of the Business,
the Log Cabin Business, the Xxxxxx Xxxxx Business and Van xx Xxxx'x and
of any business acquired under subsection 7.7(vii) for the supply of
food products used in the business of Company and its Subsidiaries; and
(vii) Company and its Subsidiaries may become and remain
liable with respect to other Contingent Obligations; provided that the
maximum aggregate liability, contingent or otherwise, of Company and
its Subsidiaries in respect of all such Contingent Obligations shall at
no time exceed $1,000,000.
7.5 Restricted Junior Payments.
Company shall not, and shall not permit any of its
Subsidiaries to, directly or
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indirectly, declare, order, pay, make or set apart any sum for any Restricted
Junior Payment; provided that (i) Company may make scheduled interest
payments in respect of the Subordinated Notes in accordance with the terms
thereof and of the Subordinated Note Indentures; provided, that to the extent
the Subordinated Note Indentures permit Company to pay interest thereon or
liquidated damages in like-kind instruments in a principal amount equal to
the amount of such interest or liquidated damages, Company shall pay such
interest or liquidated damages in such like-kind instruments; (ii) Company
may make Restricted Junior Payments to the extent necessary to redeem or
defease all or any portion of the Indebtedness under the Subordinated Note
Documents with proceeds from Indebtedness permitted under subsection 7.1(vi);
(iii) Company may make scheduled interest payments in respect of Permitted
Seller Notes permitted under subsection 7.1(vii) in accordance with the terms
of such Permitted Seller Notes; (iv) Company may make regularly scheduled
payments of interest in respect of any Subordinated Indebtedness in
accordance with the terms of, and only to the extent required by, and subject
to the subordination provisions contained in, the indenture or other
agreement pursuant to which such Subordinated Indebtedness was issued, as
such indenture or other agreement may be amended from time to time to the
extent permitted under subsection 7.12B; provided, that to the extent the
terms of such Subordinated Indebtedness permit Company to pay interest or
liquidated damages on such Subordinated Indebtedness in like-kind instruments
in a principal amount equal to the amount of such
interest or liquidated damages, Company shall pay such interest or liquidated
damages with such like-kind instruments; (v) Company may make Restricted Junior
Payments as contemplated by the Transaction to redeem or defease the
Indebtedness under the VDK Subordinated Note Documents; (vi) Company may make
Restricted Junior Payments to the extent necessary to redeem or defease all or
any portion of the Indebtedness under the Subordinated Note Documents (other
than the VDK Subordinated Note Documents), provided that (a) no Event of Default
or Potential Event of Default shall have occurred and be continuing or shall be
caused thereby, (b) Company shall be in compliance, on a pro forma basis giving
effect thereto, with the covenants set forth in subsection 7.6 hereof, (c) the
Senior Leverage Ratio (calculated on a pro forma basis giving effect to such
redemption or defeasance) shall be less than 3.75:1.00 if such redemption or
defeasance shall occur in 1998 or 1999, less than 3.50:1.00 if such redemption
or defeasance shall occur in 2000 or 2001, and less than 3.25: 1.00 if such
redemption or defeasance shall occur thereafter, (d) after giving effect to any
such redemption or defeasance, the sum of (x) the amount of cash on hand of
Company plus (y) the amount by which the Revolving Credit Commitments exceed the
Total Utilization of the Revolving Loan Commitments, shall equal or exceed
$40,000,000 (and Company shall have delivered to Administrative Agent an
Officer's Certificate (together with supporting information therefor), in form
and substance reasonably satisfactory to Administrative Agent, certifying to the
effect of clauses (b), (c) and (d)) and (e) and the aggregate amount of such
redemption or defeasance, together with any other such redemption or defeasance
since the Effective Date, shall not exceed $100,000,000 plus the applicable
premium; and (vii) Company may make dividends or other distributions, direct or
indirect, on account of any shares of any class of capital stock of Company;
provided that (a) the Senior Leverage Ratio (calculated on a pro forma basis
giving effect thereto) shall be less than 2.00:1.00 or (b) either of the
publicly announced ratings S&P or Xxxxx'x of the current senior unsecured,
non-credit enhanced long term Indebtedness of Company that has been publicly
issued are BBB-or better or Baa3 or better, respectively, and the amount of such
dividend shall not exceed 50% of Company's cumulative positive net income.
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7.6 Financial Covenants.
A. Minimum Consolidated Cash Interest Coverage Ratio. Company
shall not permit the Consolidated Cash Interest Coverage Ratio for any
four-Fiscal Quarter period ending during any of the test periods set forth in
the table below to be less than the correlative ratio for such test period set
forth in the table below:
--------------------------------------------------------------------------------------------------
MINIMUM CONSOLIDATED
TEST PERIOD CASH INTEREST COVERAGE
RATIO
--------------------------------------------------------------------------------------------------
7/01/98 - 12/31/98 1.90:1.00
--------------------------------------------------------------------------------------------------
1/01/99 - 12/31/99 2.00:1.00
--------------------------------------------------------------------------------------------------
1/01/00 - 12/31/00 2.00:1.00
--------------------------------------------------------------------------------------------------
1/01/01 - 12/31/01 2.25:1.00
--------------------------------------------------------------------------------------------------
1/01/02 - 12/31/02 2.50:1.00
--------------------------------------------------------------------------------------------------
1/01/03 - 12/31/03 2.50:1.00
--------------------------------------------------------------------------------------------------
1/01/04 - 12/31/04 2.50:1.00
--------------------------------------------------------------------------------------------------
1/01/05 - 6/30/05 2.50:1.00
==================================================================================================
B. Maximum Leverage Ratio. Company shall not permit the ratio
of (i) the excess of (a) Consolidated Total Debt as of the last day of any
Fiscal Quarter ending during any of the test periods set forth in the table
below minus (b) cash on hand of Company to the extent the amount of such cash
exceeds $3,500,000 as of such date, to (ii) Consolidated EBITDA for the
four-Fiscal Quarter period ending on such date to exceed the correlative ratio
for such test period set forth in the table below:
--------------------------------------------------------------------------------------------------
MAXIMUM
TEST PERIOD LEVERAGE RATIO
--------------------------------------------------------------------------------------------------
7/01/98 - 12/31/98 5.70:1.00
--------------------------------------------------------------------------------------------------
1/01/99 - 12/31/99 5.50:1.00
--------------------------------------------------------------------------------------------------
1/01/00 - 12/31/00 5.00:1.00
--------------------------------------------------------------------------------------------------
1/01/01 - 12/31/01 4.50:1.00
--------------------------------------------------------------------------------------------------
1/01/02 - 12/31/02 4.00:1.00
--------------------------------------------------------------------------------------------------
1/01/03 - 12/31/03 3.50:1.00
--------------------------------------------------------------------------------------------------
1/01/04 - 6/30/04 3.50:1.00
--------------------------------------------------------------------------------------------------
104
--------------------------------------------------------------------------------------------------
MAXIMUM
TEST PERIOD LEVERAGE RATIO
--------------------------------------------------------------------------------------------------
7/01/04 - 6/30/05 3.00:1.00
==================================================================================================
C. Minimum Fixed Charge Coverage Ratio. Company shall not
permit the ratio of (i) Consolidated EBITDA for any four-Fiscal Quarter period
ending during any of the test periods set forth in the table below to (ii)
Consolidated Fixed Charges for such four-Fiscal Quarter period to be less than
the correlative ratio for such test period set forth in the table below:
--------------------------------------------------------------------------------------------------
MINIMUM FIXED CHARGE
TEST PERIOD COVERAGE RATIO
--------------------------------------------------------------------------------------------------
7/01/98 - 12/31/98 1.10:1.00
--------------------------------------------------------------------------------------------------
1/01/99 - 12/31/99 1.15:1.00
--------------------------------------------------------------------------------------------------
1/01/00 - 12/31/00 1.15:1.00
--------------------------------------------------------------------------------------------------
1/01/01 - 12/31/01 1.20:1.00
--------------------------------------------------------------------------------------------------
1/01/02 - 12/31/02 1.20:1.00
--------------------------------------------------------------------------------------------------
1/01/03 - 12/31/03 1.25:1.00
--------------------------------------------------------------------------------------------------
1/01/04 - 12/31/04 1.25:1.00
--------------------------------------------------------------------------------------------------
1/01/05 - 6/30/05 1.25:1.00
==================================================================================================
D. Maximum Consolidated Capital Expenditures. Company shall
not, and shall not permit any of its respective Subsidiaries to, make or incur
Consolidated Capital Expenditures, in any Fiscal Year indicated below, in an
aggregate amount in excess of the corresponding amount (the "Maximum
Consolidated Capital Expenditures Amount") set forth below opposite such Fiscal
Year; provided that the Maximum Consolidated Capital Expenditures Amount for any
Fiscal Year shall be increased by an amount equal to the excess, if any (but in
no event more than 50% of the Maximum Consolidated Capital Expenditures Amount
for the previous Fiscal Year), of the Maximum Consolidated Capital Expenditures
Amount for the previous Fiscal Year over the actual amount of Consolidated
Capital Expenditures for such previous Fiscal Year:
--------------------------------------------------------------------------------------------------
MAXIMUM CONSOLIDATED
FISCAL YEAR CAPITAL EXPENDITURES
(OR PORTION THEREOF) AMOUNT
--------------------------------------------------------------------------------------------------
Fiscal Year ending in December 1998 $25,000,000
and each Fiscal Year thereafter
--------------------------------------------------------------------------------------------------
; provided, however, that for purposes of this subsection 7.6D, Consolidated
Capital Expenditures shall not include (i) expenditures not exceeding $6,000,000
in the aggregate
105
incurred on or prior to September 30, 1998 related to the Business and the
Log Cabin Business (a) to relocate Company's assets, (b) to purchase
computers and computer related equipment and (c) to pay transition related
expenses in connection with the foregoing, (ii) expenditures not exceeding
$15,000,000 in the aggregate incurred on or prior to June 30, 1999 to
relocate Company's assets related to the Xxxxxx Xxxxx Business and transition
related expenses in connection therewith and (iii) expenditures not exceeding
$5,000,000 in the aggregate incurred on or prior to December 31, 1998 related
to additional capital expenditure projects previously identified at Van xx
Xxxx'x.
E. Certain Calculations.
(i) With respect to calculations of Consolidated Fixed Charges,
Consolidated EBITDA and Consolidated Cash Interest Expense for any four-Fiscal
Quarter period including the Effective Date (each such period being a "Pro Forma
Calculation Period"), such calculations shall be made on a pro forma basis
assuming, in each case, (a) that the Effective Date, the Transaction and the
related borrowings by Company pursuant to this Agreement occurred on the first
day of the applicable Pro Forma Calculation Period; (b) that Consolidated EBITDA
and Consolidated Capital Expenditures for the three applicable Fiscal Quarters
ending prior to the Effective Date are as set forth on Schedule 7.6E annexed
hereto; and (c) that, with respect to calculations of Consolidated Cash Interest
Expense and each component of Consolidated Fixed Charges other than Consolidated
Capital Expenditures (Consolidated Cash Interest Expense and each such component
being, individually, a "Fixed Charge Component"), the amount of each such Fixed
Charge Component for the Pro Forma Calculation Period for the three applicable
Fiscal Quarters ending prior to the Effective Date are as set forth on Schedule
7.6E annexed hereto.
(ii) With respect to any period during which new Subsidiaries,
assets or businesses are acquired pursuant to subsection 7.7(vi), for purposes
of determining compliance with the financial covenants set forth in this
subsection 7.6, Consolidated EBITDA and Consolidated Interest Expense shall be
calculated with respect to such periods and such Subsidiaries, assets or
businesses on a pro forma basis (including (x) any adjustments certified by the
chief financial officer of the Company, that would, in the reasonable
determination of the Company satisfy the requirements of Rule 11-02(a) of
Regulation S-X of the Securities Act as if included in a registration statement
filed with the Securities and Exchange Commission and (y) any other operating
expense reductions reasonably expected to result from any acquisition of stock
or assets if such expected reductions are (1) set forth in reasonable detail in
a plan approved by and set forth in resolutions adopted by the Board of
Directors of the Company, and (2) limited to operating expenses specified in
such plan (and, if any reductions are set forth in a range, the lowest amount of
such range) that would otherwise have resulted in the payment of cash within
twelve months after the date of consummation of such transaction, net of any
operating expenses (other than extraordinary items, non-recurring or temporary
charges and other similar one-time expenses) reasonably expected to be incurred
to implement such plan, and that are to be paid in cash during such twelve-month
period, certified by the chief financial officer of the Company) using the
historical financial statements of all entities or assets so acquired or to be
acquired and the consolidated financial statements of Company and its
Subsidiaries which shall be reformulated (i) as if such acquisition, and any
acquisitions which have been consummated during such period, and any
Indebtedness or other liabilities incurred in connection with any such
106
acquisition had been consummated or incurred at the beginning of such period
(and assuming that such Indebtedness bears interest during any portion of the
applicable measurement period prior to the relevant acquisition at the
weighted average of the interest rates applicable to outstanding Loans during
such period), and (a) otherwise in conformity with certain procedures to be
agreed upon between Administrative Agent and Company, all such calculations
to be in form and substance satisfactory to Administrative Agent.
7.7 Restriction on Fundamental Changes; Asset Sales.
Company shall not, and shall not permit any of its
Subsidiaries to, alter the corporate, capital or legal structure of Company or
any of its Subsidiaries, create any new Subsidiaries or enter into any
transaction of merger or consolidation, or liquidate, wind-up or dissolve itself
(or suffer any liquidation or dissolution), or convey, sell, lease, sub-lease,
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any substantial part of its business, property or fixed
assets, whether now owned or hereafter acquired, or acquire by purchase or
otherwise any part of the business, property or fixed assets of, or stock or
other evidence of beneficial ownership of, any Person, except:
(i) any Subsidiary of Company may be merged with or
into Company or any wholly owned Subsidiary Guarantor, or be
liquidated, wound up or dissolved, or all or any substantial part of
its business, property or assets may be conveyed, sold, leased,
transferred or otherwise disposed of, in one transaction or a series of
transactions, to Company or any wholly owned Subsidiary Guarantor;
provided that, in the case of such a merger, Company or such wholly
owned Subsidiary Guarantor shall be the continuing or surviving
corporation;
(ii) Company and its Subsidiaries may make Consolidated
Capital Expenditures permitted under subsection 7.6D;
(iii) Company and its Subsidiaries may acquire inventory,
equipment and other assets in the ordinary course of business;
(iv) Company and its Subsidiaries may sell or otherwise
dispose of assets in transactions that do not constitute Asset Sales;
provided that the consideration received for such assets shall be in an
amount at least equal to the fair market value thereof (determined in
good faith by the board of directors of Company);
(v) Company and its Subsidiaries may make any Asset
Sale of assets that have, in the aggregate, a fair market value
(determined in good faith by the board of directors of Company) not in
excess of 10% of Consolidated EBITDA for the four-Fiscal Quarter period
most recently ended prior to such Asset Sale; provided that (x) the
consideration received for such assets shall be in an amount at least
equal to the fair market value thereof (determined in good faith by the
board of directors of Company); (y) not less than 80% of the
consideration received shall be cash; and (z) the proceeds of such
Asset Sales shall be applied as required by subsection 2.4B(iii)(a);
and
(vi) Company or any Subsidiary of Company may make
acquisitions
107
of assets and businesses (including acquisitions of the
capital stock or other equity interests of another Person), provided
that:
(a) immediately prior to and after giving
effect to any such acquisition, Company and its Subsidiaries
shall be in compliance with the provisions of subsection 7.11
hereof;
(b) after giving effect to any such
acquisition, the sum of (x) the amount of cash on hand of
Company and its Subsidiaries plus (y) the amount by which the
Revolving Loan Commitments exceed the Total Utilization of
Revolving Loan Commitments, shall equal or exceed $40,000,000;
(c) (1) Company shall be in compliance, on a
pro forma basis giving effect to the proposed acquisition,
with the covenants set forth in subsection 7.6 hereof, (2) the
Senior Leverage Ratio (calculated on a pro forma basis giving
effect to the proposed acquisition) shall be less than
3.75:1.00 in Fiscal Years 1998 and 1999, 3.50:1.00 in Fiscal
Years 2000 and 2001, and 3.25:1.00 thereafter and (3) no Event
of Default or Potential Event of Default shall have occurred
and be continuing at the time of such acquisition or shall be
caused thereby; and Company shall have delivered to
Administrative Agent an Officer's Certificate (together with
supporting information therefor), in form and substance
reasonably satisfactory to Administrative Agent, certifying as
to the foregoing and as to the matters referred to in
subsections 7.7(vi)(a) and (b) above;
(d) any assets acquired pursuant to such
acquisition shall be subject to a First Priority Lien in favor
of the Administrative Agent on behalf of Lenders pursuant to
the Collateral Documents; and
(e) each such acquisition shall be made on a
fully consensual basis between Company and its Subsidiaries,
on the one hand, and the seller or sellers of such assets or
such business, on the other hand.
7.8 Sales and Lease-Backs.
Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, become or remain liable as lessee or as
a guarantor or other surety with respect to any lease, whether an Operating
Lease or a Capital Lease, of any property (whether real, personal or mixed),
whether now owned or hereafter acquired, (i) which Company or any of its
Subsidiaries has sold or transferred or is to sell or transfer to any other
Person (other than Company or any of its Subsidiaries) or (a) which Company or
any of its Subsidiaries intends to use for substantially the same purpose as any
other property which has been or is to be sold or transferred by Company or any
of its Subsidiaries to any Person (other than Company or any of its
Subsidiaries) in connection with such lease, except that Company and its
Subsidiaries may enter into such sale and lease-back transactions so long as the
aggregate sales price under all such transactions in any Fiscal Year does not
exceed $5,000,000.
108
7.9 Transactions with Shareholders and Affiliates.
Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, enter into or permit to exist any
transaction (including, without limitation, the purchase, sale, lease or
exchange of any property or the rendering of any service) with any holder of 5%
or more of any class of equity Securities of Company or with any Affiliate of
Company or of any such holder, on terms that are less favorable to Company or
that Subsidiary, as the case may be, than those that might be obtained at the
time from Persons who are not such a holder or Affiliate; provided that the
foregoing restriction shall not apply to (i) any transaction between Company and
any of its Wholly Owned Subsidiaries or between any of its Wholly Owned
Subsidiaries, (ii) reasonable and customary fees paid to members of the boards
of directors of Company and its Subsidiaries, (iii) fees, expenses and other
amounts payable to the MDC Entities, Fenway, Dartford, UBS, Tiger and CALPERS on
the Effective Date, (iv) the Management Fees, (v) any employment agreement
entered into by Company or any of its Subsidiaries in the ordinary course of
business, (vi) amounts paid under the Dartford Expense Agreement, and (vii) any
issuance of capital stock of Company in connection with employment arrangements,
stock options and stock ownership plans of Company or any of its Subsidiaries
entered into in the ordinary course of business.
7.10 Disposal of Subsidiary Stock.
Company shall not:
(i) directly or indirectly sell, assign, pledge or
otherwise encumber or dispose of any shares of capital stock or other
equity Securities of any of its Subsidiaries, except as permitted under
this Agreement or the Collateral Documents or to qualify directors if
required by applicable law; or
(ii) permit any of its Subsidiaries directly or
indirectly to sell, assign, pledge or otherwise encumber or dispose of
any shares of capital stock or other equity Securities of any of its
Subsidiaries (including such Subsidiary), except as permitted under
this Agreement or the Collateral Documents or to Company, another
Wholly Owned Subsidiary of Company, or to qualify directors if required
by applicable law.
7.11 Conduct of Business.
Company shall not, and shall not permit any of its
Subsidiaries to, engage in any business other than (i) the businesses engaged in
by Company and its Subsidiaries on the Effective Date and those food businesses
which are reasonably related to such businesses, and (ii) such other lines of
business as may be consented to by Administrative Agent and Requisite Lenders.
109
7.12 Amendments or Waivers of Certain Related Agreements;
Amendments of Documents Relating to Subordinated
Indebtedness; Designation of "Designated Senior Indebtedness";
Preferred Stock.
A. Amendments or Waivers of Certain Related Agreements.
Neither Company nor any of its Subsidiaries will agree to any material amendment
to, or waive any of its material rights under, any of the Acquisition Agreement,
the Log Cabin Acquisition Agreement, the Xxxxxx Xxxxx Acquisition Agreement, the
Assumption Agreement, the Log Cabin Assumption Agreement, the Xxxxxx Xxxxx
Assumption Agreement, the MDC Advisory Agreement, the Dartford Advisory
Agreement, the Fenway Advisory Agreement, the Transition Agreements, the Log
Cabin Transition Agreements, the Xxxxxx Xxxxx Transition Agreements, the Xxxxxxx
Co-Pack Agreement or the Red Wing Co-Pack Agreements after the Effective Date if
such amendment or waiver would be adverse to Lenders without in each case
obtaining the prior written consent of Requisite Lenders to such amendment or
waiver.
B. Amendments of Documents Relating to Subordinated
Indebtedness. Company shall not, and shall not permit any of its Subsidiaries
to, amend or otherwise change the terms of any Subordinated Indebtedness, or
make any payment consistent with an amendment thereof or change thereto, if the
effect of such amendment or change is to increase the interest rate on such
Subordinated Indebtedness, change (to earlier dates) any dates upon which
payments of principal or interest are due thereon, change any event of default
or condition to an event of default with respect thereto (other than to
eliminate any such event of default or increase any grace period related
thereto), change the redemption, prepayment or defeasance provisions thereof,
change the subordination provisions thereof (or of any guaranty thereof), or
change any collateral therefor (other than to release such collateral), or if
the effect of such amendment or change, together with all other amendments or
changes made, is to increase materially the obligations of the obliger
thereunder or to confer any additional rights on the holders of such
Subordinated Indebtedness (or trustee or other representative on their behalf)
which would be adverse to Company or Lenders.
C. Designation of "Designated Senior Indebtedness". Company
shall not designate any Indebtedness as "Designated Senior Indebtedness" (as
defined in the Subordinated Note Indentures) for purposes of the Subordinated
Note Indentures, without the prior written consent of Requisite Lenders.
D. Preferred Stock. Without the prior written approval of
Requisite Lenders, Company shall not amend, restate, supplement or otherwise
modify its Certificate of Incorporation if the effect of such amendment,
restatement, supplement or modification is to provide for the issuance of any
preferred stock of Company or the filing or amendment of any certificate of
designation with respect thereto.
110
7.13 Fiscal Year.
Company shall not change its Fiscal Year-end from December 31.
SECTION 8.
EVENTS OF DEFAULT
If any of the following conditions or events ("Events of
Default") shall occur:
8.1 Failure to Make Payments When Due.
Failure by Company to pay any installment of principal of any
Loan when due, whether at stated maturity, by acceleration, by notice of
prepayment or otherwise; failure by Company to pay when due any amount payable
to an Issuing Lender in reimbursement of any drawing honored or payment made
under a Letter of Credit; or failure by Company to pay any interest on any Loan
or any fee or any other amount due under this Agreement within five days after
the date due; or
8.2 Default in Other Agreements.
(i) Failure of Company or any of its Subsidiaries to pay when
due (a) any principal of or interest on any Indebtedness (other than
Indebtedness referred to in subsection 8.1) in an individual principal amount of
$2,500,000 or more or any items of Indebtedness with an aggregate principal
amount of $5,000,000 or more or (b) any Contingent Obligation in an individual
principal amount of $2,500,000 or more or any Contingent Obligations with an
aggregate principal amount of $5,000,000 or more, in each case beyond the end of
any grace period provided therefor; or (ii) breach or default by Company or any
of its Subsidiaries with respect to any other material term of (a) any evidence
of any Indebtedness in an individual principal amount of $2,500,000 or more or
any items of Indebtedness with an aggregate principal amount of $5,000,000 or
more or any Contingent Obligation in an individual principal amount of
$2,500,000 or more or any Contingent Obligations with an aggregate principal
amount of $5,000,000 or more or (b) any loan agreement, mortgage, indenture or
other agreement relating to such Indebtedness or Contingent Obligation(s), if in
any case under this clause (ii) the effect of such breach or default is to
cause, or to permit the holder or holders of that Indebtedness or Contingent
Obligation(s) (or a trustee on behalf of such holder or holders) to cause, that
Indebtedness or Contingent Obligation(s) to become or be declared due and
payable prior to its stated maturity or the stated maturity of any underlying
obligation, as the case may be (upon the giving or receiving of notice, lapse of
time, both, or otherwise); or
8.3 Breach of Certain Covenants.
Failure of Company to perform or comply with any term or
condition contained in subsection 2.4, 2.5 or 6.2 or Section 7 of this
Agreement; or
111
8.4 Breach of Warranty.
Any material representation, warranty, certification or other
statement made by Company or any of its Subsidiaries in any Loan Document or in
any statement or certificate at any time given by Company or any of its
Subsidiaries in writing pursuant hereto or thereto or in connection herewith or
therewith shall be false in any material respect on the date as of which made;
or
8.5 Other Defaults Under Loan Documents.
Any Loan Party shall default in the performance of or
compliance with any term contained in this Agreement or any of the other Loan
Documents, other than any such term referred to in any other subsection of this
Section 8, and such default shall not have been remedied or waived within 30
days after the earlier of (i) an officer of Company becoming aware of such
default or (ii) receipt by Company of notice from any Agent or Lender of such
default; or
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc.
(i) A court having jurisdiction in the premises shall enter a
decree or order for relief in respect of Company or any of its Subsidiaries
(other than Immaterial Subsidiaries) in an involuntary case under the Bankruptcy
Code or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, which decree or order is not stayed; or any other similar
relief shall be granted under any applicable federal or state law; or (ii) an
involuntary case shall be commenced against Company or any of its Subsidiaries
(other than Immaterial Subsidiaries) under the Bankruptcy Code or under any
other applicable bankruptcy, insolvency or similar law now or hereafter in
effect; or a decree or order of a court having jurisdiction in the premises for
the appointment of a receiver, liquidator, sequestrator, trustee, custodian or
other officer having similar powers over Company or any of its Subsidiaries
(other than Immaterial Subsidiaries), or over all or a substantial part of its
property, shall have been entered; or there shall have occurred the involuntary
appointment of an interim receiver, trustee or other custodian of Company or any
of its Subsidiaries (other than Immaterial Subsidiaries) for all or a
substantial part of its property; or a warrant of attachment, execution or
similar process shall have been issued against any substantial part of the
property of Company or any of its Subsidiaries (other than Immaterial
Subsidiaries), and any such event described in this clause (ii) shall continue
for 60 days unless dismissed, bonded or discharged; or
112
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc.
(i) Company or any of its Subsidiaries (other than Immaterial
Subsidiaries) shall have an order for relief entered with respect to it or
commence a voluntary case under the Bankruptcy Code or under any other
applicable bankruptcy, insolvency or similar law now or hereafter in effect,
or shall consent to the entry of an order for relief in an involuntary case,
or to the conversion of an involuntary case to a voluntary case, under any
such law, or shall consent to the appointment of or taking possession by a
receiver, trustee or other custodian for all or a substantial part of its
property; or Company or any of its Subsidiaries (other than Immaterial
Subsidiaries) shall make any assignment for the benefit of creditors; or (ii)
Company or any of its Subsidiaries (other than Immaterial Subsidiaries) shall
be unable, or shall fail generally, or shall admit in writing its inability,
to pay its debts as such debts become due; or the Board of Directors of
Company or any of its Subsidiaries (other than Immaterial Subsidiaries) (or
any committee thereof) shall adopt any resolution or otherwise authorize any
action to approve any of the actions referred to in clause (i) above or this
clause (ii); or
8.8 Judgments and Attachments.
Any money judgment, writ or warrant of attachment or similar
process involving (i) in any individual case an amount in excess of $2,500,000
or (ii) in the aggregate at any time an amount in excess of $5,000,000 (in
either case not adequately covered by insurance as to which a solvent and
unaffiliated insurance company has acknowledged coverage) shall be entered or
filed against Company or any of its Subsidiaries or any of their respective
assets and shall remain undischarged, unvacated, unbonded or unstayed for a
period of 60 days (or in any event later than five days prior to the date of any
proposed sale thereunder); or
8.9 Dissolution.
Any order, judgment or decree shall be entered against Company
or any of its Subsidiaries decreeing the dissolution or split up of Company or
that Subsidiary and such order shall remain undischarged or unstayed for a
period in excess of 30 days; or
8.10 Employee Benefit Plans.
There shall occur one or more ERISA Events which individually
or in the aggregate results in a Material Adverse Effect; or there shall exist
an Unfunded Current Liability, individually or in the aggregate for all Pension
Plans (excluding for purposes of such computation any Pension Plans with respect
to which there is no Unfunded Current Liability), which would have a Material
Adverse Effect; or
8.11 Change in Control.
Any Person (other than the MDC Entities, Dartford, Fenway,
UBS, Tiger and CALPERS), including a "group" (within the meaning of Sections
13(d) and 14(d)(2) of the Exchange Act) which includes such Person, shall
purchase or otherwise acquire, directly or indirectly, beneficial ownership of
Securities of Company and, as a result of such purchase or acquisition, any
Person (together with its associates and Affiliates), shall directly or
indirectly
113
beneficially own in the aggregate Securities representing more than 35% of
the combined voting power of Company voting Securities; or
8.12 Invalidity of Guaranties.
At any time after the execution and delivery thereof, any
Guaranty of the Obligations of Company, for any reason other than the
satisfaction in full of all Obligations, ceases to be in full force and effect
or is declared to be null and void (except with respect to the obligations
thereunder of Immaterial Subsidiaries of Company) or any Loan Party (other than
Immaterial Subsidiaries of Company) denies in writing that it has any further
liability, including, without limitation, with respect to future advances by
Lenders, under any Loan Document to which it is a party; or
8.13 Failure of Security.
Any Collateral Document shall, at any time, cease to be in
full force and effect (other than by reason of a release of Collateral
thereunder in accordance with the terms hereof or thereof, the satisfaction in
full of the Obligations or any other termination of such Collateral Document in
accordance with the terms hereof or thereof) or shall be declared null and void;
or the validity or enforceability thereof shall be contested in writing by any
Loan Party; or Agent shall not have or shall cease to have a valid security
interest in any Collateral purported to be covered thereby, perfected and with
the priority required by the relevant Collateral Document, for any reason other
than the failure of Agents or any Lender to take any action within its control,
subject only to Liens permitted under the applicable Collateral Documents; or
8.14 Termination or Breach of Certain Transition Agreements, and
Xxxxxx Xxxxx Transaction Agreements.
The Xxxxxx Xxxxx Co-Pack Agreement, Red Wing Co-Pack
Agreements or the Flavor Supply Agreement shall terminate for any reason
whatsoever or any such party shall fail to perform its obligations under any
such agreement and such failure could reasonably be expected to result in a
Material Adverse Effect, and, in either case, Company shall not have made
arrangements satisfactory to Requisite Lenders for obtaining any services that
are required to be provided by any such party to Company under such agreement
that are not being so provided as a result of such termination or failure to
perform; or
8.15 Default Under Subordination Provisions.
Company or any guarantor of Subordinated Indebtedness shall
fail to comply with the subordination provisions contained in the Subordinated
Note Indentures or any other instrument, indenture or agreement pursuant to
which such Subordinated Indebtedness is issued;
THEN (i) upon the occurrence of any Event of Default
described in subsection 8.6 or 8.7, each of (a) the unpaid principal amount
of and accrued interest on the Loans, (b) an amount equal to the maximum
amount that may at any time be drawn under all Letters of Credit then
outstanding (whether or not any beneficiary under any such Letter of Credit
shall have
114
presented, or shall be entitled at such time to present, the drafts or other
documents or certificates required to draw under such Letter of Credit) and
(c) all other Obligations shall automatically become immediately due and
payable, without presentment, demand, protest or other requirements of any
kind, all of which are hereby expressly waived by Company, and the obligation
of each Lender to make any Loan, the obligation of Administrative Agent to
issue any Letter of Credit and the right of any Lender to issue any Letter of
Credit hereunder shall thereupon terminate, and (ii) upon the occurrence and
during the continuation of any other Event of Default, Administrative Agent
shall, upon the written request of Requisite Lenders, by written notice to
Company, declare all or any portion of the amounts described in clauses (a)
through (c) above to be, and the same shall forthwith become, immediately due
and payable, and the obligation of each Lender to make any Loan, the
obligation of Administrative Agent to issue any Letter of Credit and the
right of any Lender to issue any Letter of Credit hereunder shall thereupon
terminate; provided that the foregoing shall not affect in any way the
obligations of Lenders under subsection 3.3C(i).
Any amounts described in clause (b) above, when received by
Administrative Agent, shall be held by Administrative Agent pursuant to the
terms of the Collateral Account Agreement and shall be applied as therein
provided.
Notwithstanding anything contained in the second preceding
paragraph, if at any time within 60 days after an acceleration of the Loans
pursuant to such paragraph Company shall pay all arrears of interest and all
payments on account of principal which shall have become due otherwise than as a
result of such acceleration (with interest on principal and, to the extent
permitted by law, on overdue interest, at the rates specified in this Agreement)
and all Events of Default and Potential Events of Default (other than
non-payment of the principal of and accrued interest on the Loans, in each case
which is due and payable solely by virtue of acceleration) shall be remedied or
waived pursuant to subsection 10.6, then Requisite Lenders, by written notice to
Company, may at their option rescind and annul such acceleration and its
consequences; but such action shall not affect any subsequent Event of Default
or Potential Event of Default or impair any right consequent thereon. The
provisions of this paragraph are intended merely to bind Lenders to a decision
which may be made at the election of Requisite Lenders and are not intended to
benefit Company and do not grant Company the right to require Lenders to rescind
or annul any acceleration hereunder or preclude Agents or Lenders from
exercising any of the rights or remedies available to them under any of the Loan
Documents, even if the conditions set forth in this paragraph are met.
SECTION 9.
AGENTS
9.1 Appointment.
X. Xxxxx is hereby appointed Administrative Agent
hereunder and under the other Loan Documents and each Lender hereby
authorizes Administrative Agent to act as its agent in accordance with the
terms of this Agreement and the other Loan Documents. NatWest is hereby
appointed Syndication Agent hereunder and under the other Loan Documents and
each Lender hereby authorizes Syndication Agent to act as its agent in
accordance with the terms of this Agreement and the other Loan Documents. UBS
AG is hereby appointed Documentation
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Agent hereunder and under the other Loan Documents and each Lender hereby
authorizes Documentation Agent to act as its agent in accordance with the
terms of this Agreement and the other Loan Documents. Each Agent agrees to
act upon the express conditions contained in this Agreement and the other
Loan Documents, as applicable. The provisions of this Section 9 are solely
for the benefit of Agents and Lenders and Company shall have no rights as a
third party beneficiary of any of the provisions thereof. In performing its
functions and duties under this Agreement, each Agent shall act solely as an
agent of 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 Company
or any of its Subsidiaries.
B. Appointment of Supplemental Collateral Agents. It is the
purpose of this Agreement and the other Loan Documents that there shall be no
violation of any law of any jurisdiction denying or restricting the right of
banking corporations or associations to transact business as agent or trustee in
such jurisdiction. It is recognized that in case of litigation under this
Agreement or any of the other Loan Documents, and in particular in case of the
enforcement of any of the Loan Documents, or in case Administrative Agent deems
that by reason of any present or future law of any jurisdiction Administrative
Agent may not exercise any of the rights, powers or remedies granted herein or
in any of the other Loan Documents or take any other action which may be
desirable or necessary in connection therewith, it may be necessary that
Administrative Agent appoint an additional individual or institution as a
separate trustee, co-trustee, collateral agent or collateral coagent (any such
additional individual or institution being referred to herein individually as a
"Supplemental Collateral Agent" and collectively as "Supplemental Collateral
Agents").
In the event that Administrative Agent appoints a Supplemental
Collateral Agent with respect to any Collateral, (i) each and every right,
power, privilege or duty expressed or intended by this Agreement or any of the
other Loan Documents to be exercised by or vested in or conveyed to
Administrative Agent with respect to such Collateral shall be exercisable by and
vest in such Supplemental Collateral Agent to the extent, and only to the
extent, necessary to enable such Supplemental Collateral Agent to exercise such
rights, powers and privileges with respect to such Collateral and to perform
such duties with respect to such Collateral, and every covenant and obligation
contained in the Loan Documents and necessary to the exercise or performance
thereof by such Supplemental Collateral Agent shall run to and be enforceable by
either Administrative Agent or such Supplemental Collateral Agent, and (ii) the
provisions of this Section 9 and of subsections 10.2 and 10.3 that refer to
Administrative Agent shall inure to the benefit of such Supplemental Collateral
Agent and all references therein to Administrative Agent shall be deemed to be
references to Administrative Agent and/or such Supplemental Collateral Agent, as
the context may require.
Should any instrument in writing from Company or any other
Loan Party be required by any Supplemental Collateral Agent so appointed by
Administrative Agent for more fully and certainly vesting in and confirming to
him or it such rights, powers, privileges and duties, Company shall, or shall
cause such Loan Party to, execute, acknowledge and deliver any and all such
instruments promptly upon request by Administrative Agent. In case any
Supplemental Collateral Agent, or a successor thereto, shall die, become
incapable of acting, resign or be removed, all the rights, powers, privileges
and duties of such Supplemental Collateral Agent, to the extent permitted by
law, shall vest in and be exercised by Administrative
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Agent until the appointment of a new Supplemental Collateral Agent.
9.2 Powers; General Immunity.
A. Duties Specified. Each Lender irrevocably authorizes each
Agent to take such action on such Lender's behalf and to exercise such powers
hereunder and under the other Loan Documents as are specifically delegated to
such Agent by the terms hereof and thereof, together with such powers as are
reasonably incidental thereto. Each Agent shall have only those duties and
responsibilities that are expressly specified in this Agreement and the other
Loan Documents, and it may perform such duties by or through its agents or
employees. No Agent shall have, by reason of this Agreement or any of the other
Loan Documents, a fiduciary relationship in respect of any Lender; and nothing
in this Agreement or any of the other Loan Documents, expressed or implied, is
intended to or shall be so construed as to impose upon any Agent any obligations
in respect of this Agreement or any of the other Loan Documents except as
expressly set forth herein or therein.
B. No Responsibility for Certain Matters. No Agent shall be
responsible to any Lender for the execution, effectiveness, genuineness,
validity, enforceability, collectibility or sufficiency of this Agreement or any
other Loan Document or for any representations, warranties, recitals or
statements made herein or therein or made in any written or oral statement or in
any financial or other statements, instruments, reports or certificates or any
other documents furnished by any Agent to Lenders or by or on behalf of Company
and/or its Subsidiaries to any Agent or any Lender in connection with the Loan
Documents and the transactions contemplated thereby or for the financial
condition or business affairs of Company or any other Person liable for the
payment of any Obligations, nor shall any Agent be required to ascertain or
inquire as to the performance or observance of any of the terms, conditions,
provisions, covenants or agreements contained in any of the Loan Documents or as
to the use of the proceeds of the Loans or the use of the Letters of Credit or
as to the existence or possible existence of any Event of Default or Potential
Event of Default. Anything contained in this Agreement to the contrary
notwithstanding, Administrative Agent shall have no liability arising from
confirmations of the amount of outstanding Loans or the Total Utilization of
Revolving Loan Commitments or the component amounts thereof
C. Exculpatory Provisions. Neither any Agent nor any of
such Agent's respective officers, directors, employees or agents shall be
liable to Lenders for any action taken or omitted by such Agent under or in
connection with any of the Loan Documents except to the extent caused by such
Agent's gross negligence or willful misconduct. If any Agent shall request
instructions from Lenders with respect to any act or action (including the
failure to take an action) in connection with this Agreement or any of the
other Loan Documents, such Agent shall be entitled to refrain from such act
or taking such action unless and until such Agent shall have received
instructions from Requisite Lenders (or such other Lenders as may be required
to give such instructions under subsection 10.6). Without prejudice to the
generality of the foregoing, (i) such Agent shall be entitled to rely, and
shall be fully protected in relying, upon any communication, instrument or
document believed by it to be genuine and correct and to have been signed or
sent by the proper person or persons, and shall be entitled to rely and shall
be protected in relying on opinions and judgments of attorneys (who may be
attorneys for Company and its Subsidiaries), accountants, experts and other
professional advisors selected by it; and (ii)
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no Lender shall have any right of action whatsoever against such Agent as a
result of such Agent acting or (where so instructed) refraining from acting
under this Agreement or any of the other Loan Documents in accordance with
the instructions of Requisite Lenders (or such other Lenders as may be
required to give such instructions under subsection 10.6). Such Agent shall
be entitled to refrain from exercising any power, discretion or authority
vested in it under this Agreement or any of the other Loan Documents unless
and until it has obtained the instructions of Requisite Lenders (or such
other Lenders as may be required to give such instructions under subsection
10.6).
D. Agents Entitled to Act as Lender. The agency hereby created
shall in no way impair or affect any of the rights and powers of, or impose any
duties or obligations upon, any Agent in its individual capacity as a Lender
hereunder. With respect to its participation in the Loans and the Letters of
Credit, each Agent shall have the same rights and powers hereunder as any other
Lender and may exercise the same as though it were not performing the duties and
functions delegated to it hereunder, and the term "Lender" or "Lenders" or any
similar term shall, unless the context clearly otherwise indicates, include such
Agent in its individual capacity. Each Agent and its Affiliates may accept
deposits from, lend money to and generally engage in any kind of banking, trust,
financial advisory or other business with Company or any of its Affiliates as if
it were not performing the duties specified herein, and may accept fees and
other consideration from Company and/or its Subsidiaries for services in
connection with this Agreement and otherwise without having to account for the
same to Lenders.
9.3 Representations and Warranties;
No Responsibility For Appraisal of Creditworthiness.
Each Lender represents and warrants that it has made its
own independent investigation of the financial condition and affairs of
Company and its Subsidiaries in connection with the making of the Loans and
the issuance of Letters of Credit hereunder and that it has made and shall
continue to make its own appraisal of the creditworthiness of Company and its
Subsidiaries. No Agent shall have any duty or responsibility, either
initially or on a continuing basis, to make any such investigation or any
such appraisal on behalf of Lenders or, except as expressly provided
elsewhere in this Agreement, to provide any Lender with any credit or other
information with respect thereto, whether coming into its possession before
the making of the Loans or at any time or times thereafter, and no Agent
shall have any responsibility with respect to the accuracy of or the
completeness of any information provided to Lenders.
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9.4 Right to Indemnity.
Each Lender, in proportion to its Pro Rata Share, severally
agrees to indemnify each Agent, to the extent that such Agent shall not have
been reimbursed by Company, for and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including, without limitation, counsel fees and disbursements) or
disbursements of any kind or nature whatsoever which may be imposed on, incurred
by or asserted against such Agent in performing its duties hereunder or under
the other Loan Documents or otherwise in its capacity as such Agent in any way
relating to or arising out of this Agreement or the other Loan Documents;
provided that no Lender shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from such Agent's gross negligence or
willful misconduct.
9.5 Successor Agents and Swing Line Lender.
A. Successor Agents. Any Agent may resign at any time by
giving 30 days' prior written notice thereof to the other Agents, Lenders and
Company, and any Agent may be removed at any time with or without cause by an
instrument or concurrent instruments in writing delivered to Company and
Administrative Agent and signed by Requisite Lenders. Upon any such notice of
resignation or any such removal, Requisite Lenders shall have the right, upon
five Business Days' notice to Company, to appoint a successor Agent. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, that
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring or removed Agent and the
retiring or removed Agent shall be discharged from its duties and obligations
under this Agreement. After any retiring or removed Agent's resignation or
removal hereunder as Agent, the provisions of this Section 9 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under this Agreement.
B. Successor Swing Line Lender. Any resignation or removal
of Administrative Agent pursuant to subsection 9.5A shall also constitute the
resignation or removal of Chase or its successor as Swing Line Lender, and
any successor Administrative Agent appointed pursuant to subsection 9.5A
shall, upon its acceptance of such appointment, become the successor Swing
Line Lender for all purposes hereunder. In such event (i) Company shall
prepay any outstanding Swing Line Loans made by the retiring or removed
Administrative Agent in its capacity as Swing Line Lender, (ii) upon such
prepayment, the retiring or removed Administrative Agent and Swing Line
Lender shall surrender the Swing Line Note held by it to Company for
cancellation, and (iii) Company shall issue a new Swing Line Note to the
successor Administrative Agent and Swing Line Lender substantially in the
form of Exhibit VI annexed hereto, in the principal amount of the Swing Line
Loan Commitment then in effect and with other appropriate insertions.
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9.6 Collateral Documents.
Each Lender and Agent hereby further authorizes Administrative
Agent to enter into each Collateral Document as secured party on behalf of and
for the benefit of Agents and Lenders and agrees to be bound by the terms of
each Collateral Document; provided that Administrative Agent shall not enter
into or consent to any amendment, modification, termination or waiver of any
provision contained in any Collateral Document without the prior consent of
Requisite Lenders (or, if required pursuant to subsection 10.6, all Lenders);
provided further, however, that, without further written consent or
authorization from Requisite Lenders, Administrative Agent may execute any
documents or instruments necessary to effect the release of any asset
constituting Collateral from the Lien of the applicable Collateral Document in
the event that such asset is sold or otherwise disposed of in a transaction
effected in accordance with subsection 7.7. Anything contained in any of the
Loan Documents to the contrary notwithstanding, each Lender agrees that no
Lender shall have any right individually to realize upon any of the Collateral
under any Collateral Document (including, without limitation, through the
exercise of a right of set-off against call deposits of such Lender in which any
funds on deposit in the Collateral Account may from time to time be invested),
it being understood and agreed that all rights and remedies under the Collateral
Documents may be exercised solely by Administrative Agent for the benefit of
Lenders in accordance with the terms thereof.
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SECTION 10.
MISCELLANEOUS
10.1 Assignments and Participations in Loans, Letters of Credit.
A. General. Subject to subsection 10.1B, each Lender shall
have the right at any time to (i) sell, assign, transfer or negotiate to any
Eligible Assignee, or (ii) sell participations to any Person in, all or any
part of its Commitments (together with its Letters of Credit or
participations therein made or arising pursuant to its Revolving Loan
Commitment) or any Loan or Loans made by it or any other interest herein or
in any other Obligations owed to it; provided that no such sale, assignment,
transfer or participation shall, without the consent of Company, require
Company to file a registration statement with the Securities and Exchange
Commission or apply to qualify such sale, assignment, transfer or
participation under the securities laws of any state; provided further, that
no such sale, assignment or transfer described in clause (i) above shall be
effective unless and until an Assignment Agreement effecting such sale,
assignment or transfer shall have been accepted by Administrative Agent and
recorded in the Register as provided in subsection 10.1B(ii); provided
further, that no such sale, assignment, transfer or participation of any
Letter of Credit or any participation therein may be made separately from a
sale, assignment, transfer or participation of a corresponding interest in
the Revolving Loan Commitment and the Revolving Loans of the Lender effecting
such sale, assignment, transfer or participation; and provided further, that
anything contained herein to the contrary notwithstanding, the Swing Line
Loan Commitment and the Swing Line Loans of Swing Line Lender may not be
sold, assigned or transferred as described in clause (i) above to any Person
other than a successor Administrative Agent and Swing Line Lender to the
extent contemplated by subsection 9.5. Except as otherwise provided in this
subsection 10.1, no Lender shall, as between Company and such Lender, be
relieved of any of its obligations hereunder as a result of any sale,
assignment, transfer or negotiation of, or any granting of participations in,
all or any part of its Commitments or the Loans, the Letters of Credit or
participations therein or the other Obligations owed to such Lender.
B. Assignments.
(i) Amounts and Terms of Assignments. Each Commitment, Loan,
Letter of Credit, or participation therein or other Obligation may (a) be
assigned in any amount to another Lender who is a Non-Defaulting Lender, to an
Approved Fund of a Non-Defaulting Lender, or to an Affiliate of the assigning
Lender or another Lender who, in either such case, is a Non-Defaulting Lender,
with the consent of Administrative Agent (which consent shall not be
unreasonably withheld) and the giving of notice to Company; provided that, after
giving effect to a proposed assignment to another Lender, the assigning Lender
shall have an aggregate Commitment of at least $5,000,000 unless the proposed
assignment constitutes the aggregate amount of the Commitments, Loans, Letters
of Credit, and participations therein and other Obligations of the assigning
Lender, or (b) be assigned in an aggregate amount of not less than $5,000,000
(or such lesser amount as shall constitute the aggregate amount of the
Commitments, Loans, Letters of Credit, and participations therein and other
Obligations of the assigning Lender) to any other Eligible Assignee with the
consent of Administrative Agent (which consent shall not be unreasonably
withheld) and the giving of notice to Company. To the extent of any
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such assignment in accordance with either clause (a) or (b) above, the
assigning Lender shall be relieved of its obligations with respect to its
Commitments, Loans, Letters of Credit, or participations therein or other
Obligations or the portion thereof so assigned. The parties to each such
assignment shall execute and deliver to Administrative Agent, for its
acceptance and recording in the Register, an Assignment Agreement, together
with a processing fee of $3,500 payable by the assigning Lender and such
certificates, documents or other evidence, if any, with respect to United
States federal income tax withholding matters as the assignee under such
Assignment Agreement may be required to deliver to Administrative Agent
pursuant to subsection 2.7B(iii)(a). Upon such execution, delivery,
acceptance and recordation, from and after the effective date specified in
such Assignment Agreement, (y) the assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment Agreement, shall have the rights
and obligations of a Lender hereunder and (z) the assigning Lender thereunder
shall, to the extent that rights and obligations hereunder have been assigned
by it pursuant to such Assignment Agreement, relinquish its rights (other
than any rights which survive the termination of this Agreement under
subsection 10.9B) and be released from its obligations under this Agreement
(and, in the case of an Assignment Agreement covering all or the remaining
portion of an assigning Lender's rights and obligations under this Agreement,
such Lender shall cease to be a party hereto; provided that, anything
contained in any of the Loan Documents to the contrary notwithstanding, if
such Lender is the Issuing Lender with respect to any outstanding Letters of
Credit such Lender shall continue to have all rights and obligations of an
Issuing Lender with respect to such Letters of Credit until the cancellation
or expiration of such Letters of Credit and the reimbursement of any amounts
drawn thereunder). The Commitments hereunder shall be modified to reflect the
Commitments of such assignee and any remaining Commitments of such assigning
Lender and, if any such assignment occurs after the issuance of the Notes
hereunder, the assigning Lender shall surrender its applicable Notes and,
upon such surrender, new Notes shall be issued to the assignee and, if
applicable, to the assigning Lender, substantially in the form of Exhibit IV,
Exhibit V or Exhibit VI annexed hereto, as the case may be, with appropriate
insertions, to reflect the new Commitments and/or outstanding Term Loans of
the assignee and the assigning Lender.
(ii) Acceptance by Administrative Agent: Recordation in Register.
Upon its receipt of an Assignment Agreement executed by an assigning Lender and
an assignee representing that it is an Eligible Assignee, together with the
processing fee referred to in subsection 10.1B(i) and any certificates,
documents or other evidence with respect to United States federal income tax
withholding matters that such assignee may be required to deliver to
Administrative Agent pursuant to subsection 2.7B(iii)(a), Administrative Agent
shall, if such Assignment Agreement has been completed and is in substantially
the form of Exhibit XV hereto and if Administrative Agent have consented to the
assignment evidenced thereby (to the extent such consent is required pursuant to
subsection 10.1B(i)), (a) accept such Assignment Agreement by executing a
counterpart thereof as provided therein (which acceptance shall evidence any
required consent of Administrative Agent to such assignment), (b) record the
information contained therein in the Register, and (c) give prompt notice
thereof to Company. Administrative Agent shall maintain a copy of each
Assignment Agreement delivered to and accepted by it as provided in this
subsection 10.1B(ii).
C. Participations. The holder of any participation, other than
an Affiliate of the Lender granting such participation, shall not be entitled to
require such Lender to take or omit
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to take any action hereunder except action (i) effecting the extension of the
final maturity of the Loan allocated to such participation, (ii) effecting a
reduction of the principal amount of or affecting the rate of interest
payable on any Loan allocated to such participation, (iii) releasing all or
substantially all of the Collateral, or (iv) releasing all of the Guarantors
from their obligations under the Guaranties, and all amounts payable by
Company hereunder (including, without limitation, amounts payable to such
Lender pursuant to subsections 2.6D, 2.7 and 3.6) shall be determined as if
such Lender had not sold such participation. Company and each Lender hereby
acknowledge and agree that, solely for purposes of subsections 10.4 and 10.5,
(a) any participation will give rise to a direct obligation of Company to the
participant and (b) the participant shall be considered to be a "Lender".
D. Assignments to Federal Reserve Banks. In addition to the
assignments and participations permitted under the foregoing provisions of
this subsection 10.1, any Lender (without having to obtain the consent of
Company or Administrative Agent) may assign and pledge all or any portion of
its Loans, the other Obligations owed to such Lender and its Notes to secure
obligations of such Lender, including, without limitation, assignments and
pledges to any Federal Reserve Bank 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, and any Lender which
is an investment fund may pledge all or any portion of its Notes or Loans to
its trustee to secure its obligations to such trustee; provided that (i) no
Lender shall, as between Company and such Lender, be relieved of any of its
obligations hereunder as a result of any such assignment and pledge and (ii)
in no event shall such Federal Reserve Bank be considered to be a "Lender" or
be entitled to require the assigning Lender to take or omit to take any
action hereunder.
E. Information. Each Lender may furnish any information
concerning Company and its Subsidiaries in the possession of that Lender from
time to time to assignees and participants (including prospective assignees and
participants).
F. Limitation. No assignee, participant or other transferee or
any Lender's rights shall be entitled to receive any greater payment under
subsection 2.7 than such Lender would have been entitled to receive with respect
to the rights transferred, unless such transfer is made with Company's prior
written consent or at a time when the circumstances giving rise to such greater
payment did not exist.
G. Representations of Lenders. Each Lender listed on the
signature pages hereof hereby represents and warrants (i) that it is an Eligible
Assignee described in clause (i) of the definition thereof; (ii) that it has
experience and expertise in the making of loans such as the Loans; and (iii)
that it will make its Loans for its own account in the ordinary course of its
business and without a view to distribution of such Loans within the meaning of
the Securities Act or the Exchange Act or other federal securities laws (it
being understood that, subject to the provisions of this subsection 10.1, the
disposition of such Loans or any interests therein shall at all times remain
within its exclusive control). Each Lender that becomes a party hereto pursuant
to an Assignment Agreement shall be deemed to agree that the representations and
warranties of such Lender contained in Section 2(c) of such Assignment Agreement
are incorporated herein by this reference.
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10.2 Expenses.
Whether or not the transactions contemplated hereby shall
be consummated, Company agrees to pay promptly (i) all the actual and
reasonable costs and out of pocket expenses of Administrative Agent in
connection with the preparation of the Loan Documents; (ii) all the actual
and reasonable costs of furnishing all opinions by counsel for Company
(including, without limitation, any opinions requested by Lenders as to any
legal matters arising hereunder) and of Company's performance of and
compliance with all agreements and conditions on its part to be performed or
complied with under this Agreement and the other Loan Documents including,
without limitation, with respect to confirming compliance with environmental
and insurance requirements; (iii) the reasonable fees, expenses and
disbursements of counsel to Agents (including allocated costs of internal
counsel) in connection with the negotiation, preparation, execution and
administration of the Loan Documents and the Loans and any consents,
amendments, waivers or other modifications hereto or thereto and any other
documents or matters requested by Company; (iv) all other actual and
reasonable costs and expenses incurred by Agents in connection with the
negotiation, preparation and execution of the Loan Documents and the
transactions contemplated hereby and thereby; and (v) after the occurrence of
an Event of Default, all costs and expenses, including reasonable attorneys'
fees (including allocated costs of internal counsel) and costs of settlement,
incurred by Agents and Lenders in enforcing any Obligations of or in
collecting any payments due from Company hereunder or under the other Loan
Documents by reason of such Event of Default or in connection with any
refinancing or restructuring of the credit arrangements provided under this
Agreement in the nature of a "work-out" or pursuant to any insolvency or
bankruptcy proceedings.
10.3 Indemnity.
In addition to the payment of expenses pursuant to subsection
10.2, whether or not the transactions contemplated hereby shall be consummated,
Company agrees to defend, indemnify, pay and hold harmless Agents and Lenders,
and the officers, directors, trustees, partners, employees, agents, attorneys
and affiliates of any of Agents and Lenders (collectively called the
"Indemnitees") from and against any and all other liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, claims, costs, expenses
and disbursements of any kind or nature whatsoever (including, without
limitation, the reasonable fees and disbursements of counsel for such
Indemnitees in connection with any investigative, administrative or judicial
proceeding commenced or threatened by any Person, whether or not any such
Indemnitee shall be designated as a party or a potential party thereto), whether
direct, indirect or consequential and whether based on any federal, state or
foreign laws, statutes, rules or regulations (including, without limitation,
securities and commercial laws, statutes, rules or regulations and Environmental
Laws), on common law or equitable cause or on contract or otherwise, that may be
imposed on, incurred by, or asserted against any such Indemnitee, in any manner
relating to or arising out of this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby (including, without limitation,
Lenders' agreement to make the Loans hereunder or the use or intended use of the
proceeds of any of the Loans or the issuance of Letters of Credit hereunder or
the use or intended use of any of the Letters of Credit) (collectively called
the "Indemnified Liabilities"); provided that Company shall not have any
obligation to any Indemnitee hereunder with respect to any Indemnified
Liabilities to the extent,
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and only to the extent, of any particular liability, obligation, loss,
damage, penalty, claim, cost, expense or disbursement that arose from the
gross negligence or willful misconduct of that Indemnitee as determined by a
final judgment of a court of competent jurisdiction. To the extent that the
undertaking to defend, indemnify, pay and hold harmless set forth in the
preceding sentence may be unenforceable because it is violative of any law or
public policy, Company shall contribute the maximum portion that it is
permitted to pay and satisfy under applicable law to the payment and
satisfaction of all Indemnified Liabilities incurred by the Indemnitees or
any of them.
10.4 Set-Off; Security Interest in Deposit Accounts.
In addition to any rights now or hereafter granted under
applicable law and not by way of limitation of any such rights, upon the
occurrence and during the continuance of any Event of Default each Lender is
hereby authorized by Company at any time or from time to time, without notice to
Company or to any other Person, any such notice being hereby expressly waived,
to set off and to appropriate and to apply any and all deposits (general or
special, including, but not limited to, Indebtedness evidenced by certificates
of deposit, whether matured or unmatured, but not including trust accounts) and
any other Indebtedness at any time held or owing by that Lender (at any office
of that Lender wherever located) to or for the credit or the account of Company
against and on account of the obligations and liabilities of Company to that
Lender under this Agreement, the Notes, the Letters of Credit and participations
therein, including, but not limited to, all claims of any nature or description
arising out of or connected with this Agreement, the Notes, the Letters of
Credit and participations therein or any other Loan Document, irrespective of
whether or not (i) that Lender shall have made any demand hereunder or (ii) the
principal of or the interest on the Loans or any amounts in respect of the
Letters of Credit or any other amounts due hereunder shall have become due and
payable pursuant to Section 8 and although said obligations and liabilities, or
any of them, may be contingent or unmatured. Company hereby further grants to
each Agent and Lender a security interest in all deposits and accounts
maintained with such Agent or Lender as security for the Obligations.
10.5 Ratable Sharing.
Lenders hereby agree among themselves that if any of them
shall, whether by voluntary payment (other than a voluntary prepayment of Loans
made and applied in accordance with the terms of this Agreement), by realization
upon security, through the exercise of any right of set-off or banker's lien, by
counterclaim or cross action or by the enforcement of any right under the Loan
Documents or otherwise, or as adequate protection of a deposit treated as cash
collateral under the Bankruptcy Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, amounts payable in
respect of Letters of Credit, fees and other amounts then due and owing to that
Lender hereunder or under the other Loan Documents (collectively, the "Aggregate
Amounts Due" to such Lender) which is greater than the proportion received by
any other Lender in respect of the Aggregate Amounts Due to such other Lender,
then the Lender receiving such proportionately greater payment shall (i) notify
Administrative Agent and each other Lender of the receipt of such payment and
(ii) apply a portion of such payment to purchase participations (which it shall
be deemed to have purchased from each seller of a participation simultaneously
upon the receipt by such seller of its portion of such payment) in the Aggregate
Amounts Due to the other Lenders so that all such recoveries of Aggregate
125
Amounts Due shall be shared by all Lenders in proportion to the Aggregate
Amounts Due to them; provided that if all or part of such proportionately
greater payment received by such purchasing Lender is thereafter recovered
from such Lender upon the bankruptcy reorganization or insolvency proceeding
of Company or otherwise, those purchases shall be rescinded and the purchase
prices paid for such participations shall be returned to such purchasing
Lender ratably to the extent of such recovery, but without interest. Company
expressly consents to the foregoing arrangement and agrees that any holder of
a participation so purchased may exercise any and all rights of banker's
lien, set-off or counterclaim with respect to any and all monies owing by
Company to that holder with respect thereto as fully as if that holder were
owed the amount of the participation held by that holder.
10.6 Amendments and Waivers.
A. No amendment, modification, termination or waiver of any
provision of this Agreement or of the Notes, or consent to any departure by
Company or any other Loan Party therefrom, shall in any event be effective
without the written concurrence of Requisite Lenders; provided that any such
amendment, modification, termination, waiver or consent which: reduces the
principal amount of any of the Loans; changes in any manner the definition of
"Requisite Lenders" (it being understood that, with the consent of the Requisite
Lenders, additional extensions of credit pursuant to this Agreement may be
included in the determination of "Requisite Lenders" on substantially the same
basis as the Tranche A Term Loan Commitments, Tranche A Term Loans, Revolving
Loan Commitments and Revolving Loans are included on the Effective Date);
changes in any manner any provision of this Agreement which, by its terms,
expressly requires the approval or concurrence of all Lenders; postpones the
scheduled final maturity date of any of the Loans; postpones the date or reduces
the amount of any scheduled payment (but not prepayment) of principal of any of
the Loans; postpones the date or reduces the amount of any scheduled reduction
(but not prepayment) of the Revolving Loan Commitments; postpones the date on
which any interest or any fees are payable; decreases the interest rate borne by
any of the Loans (other than any waiver of any increase in the interest rate
applicable to any of the Loans pursuant to subsection 2.2E) or the amount of any
fees payable hereunder; increases the maximum duration of Interest Periods
permitted hereunder; releases all or substantially all of the Collateral;
releases all or substantially all of the Subsidiary Guarantors from their
obligations under the Subsidiary Guaranty; reduces the amount or postpones the
due date of any amount payable in respect of, or extends the required expiration
date of, any Letter of Credit; changes the obligations of Lenders relating to
the purchase of participations in Letters of Credit in any manner that could be
adverse to any Issuing Lender; or changes in any manner the provisions contained
in subsection 8.1 or this subsection 10.6; shall be effective only if evidenced
by a writing signed by or on behalf of all Lenders to whom are owed Obligations
being directly affected by such amendment, modification, termination, waiver or
consent. In addition, (i) any amendment, modification, termination or waiver of
any of the provisions contained in Section 4 shall be effective only if
evidenced by a writing signed by or on behalf of Administrative Agent and
Requisite Lenders, (ii) no amendment, modification, termination or waiver of any
provision of any Note shall be effective without the written concurrence of the
Lender which is the holder of that Note, (iii) no amendment, modification,
termination or waiver of any provision of this Agreement which
disproportionately and adversely affects the obligation of any Loan Party to
make payments (including without limitation mandatory prepayments) to the
holders of the Term Loans or the holders of the Revolving Loans and Revolving
Loan Commitments, shall be
126
effective without the written concurrence of the holders of more than 50% in
principal amount of the class (i.e., Tranche A Term Loans or Revolving Loans
and Revolving Loan Commitments each being a "class" of Loans) of Loans so
disproportionately and adversely affected; (iv) no increase in the
Commitments of any Lender over the amount thereof then in effect shall be
effective without the written concurrence of that Lender, it being understood
and agreed that in no event shall waivers or modifications of conditions
precedent, covenants, Events of Default, Potential Events of Default or of a
mandatory prepayment or a reduction of any or all of the Commitments be
deemed to constitute an increase of the Commitment of any Lender and that an
increase in the available portion of any Commitment of any Lender shall not
be deemed to constitute an increase in the Commitment of such Lender, (v) no
amendment, modification, termination or waiver of any provision of subsection
2.1A(iii) or any other provision of this Agreement relating to the Swing Line
Loan Commitment or the Swing Line Loans shall be effective without the
written concurrence of Swing Line Lender, (vi) no amendment, modification,
termination or waiver of any provision of Section 3 relating to the rights or
obligations of any or all Issuing Lenders shall be effective without the
written concurrence of Administrative Agent and each Lender who is an Issuing
Lender with respect to any Letter of Credit then outstanding, and (vii) no
amendment, modification, termination or waiver of any provision of Section 9
or of any other provision of this Agreement which, by its terms, expressly
requires the approval or concurrence of Administrative Agent shall be
effective without the written concurrence of Administrative Agent.
Administrative Agent may, but shall have no obligation to, with the
concurrence of any Lender, execute amendments, modifications, waivers or
consents on behalf of that Lender. Any waiver or consent shall be effective
only in the specific instance and for the specific purpose for which it was
given. No notice to or demand on Company in any case shall entitle Company to
any other or further notice or demand in similar or other circumstances. Any
amendment, modification, termination, waiver or consent effected in
accordance with this subsection 10.6 shall be binding upon each Lender at the
time outstanding, each future Lender and, if signed by Company, on Company.
B. If, in connection with any proposed change, waiver,
discharge or termination to any of the provision of this Agreement as
contemplated by the proviso in the first sentence of this subsection 10.6, the
consent of Requisite Lenders is obtained but consent of one or more of such
other Lenders whose consent is required is not obtained, then Company may, so
long as all non-consenting Lenders are so treated, elect to terminate such
Lender as a party to this Agreement; provided that, concurrently with such
termination, (i) Company shall pay that Lender all principal, interest and fees
and other amounts due to be paid to such Lender with respect to all periods
through such date of termination, (ii) another financial institution
satisfactory to Company and Administrative Agent (or if Administrative Agent is
also a Lender to be terminated, the successor Administrative Agent) shall agree,
as of such date, to become a Lender for all purposes under this Agreement
(whether by assignment or amendment) and to assume all obligations of the Lender
to be terminated as of such date, and (iii) all documents and supporting
materials necessary, in the judgment of Administrative Agent (or if
Administrative Agent is also a Lender to be terminated, the successor
Administrative Agent) to evidence the substitution of such Lender shall have
been received and approved by Administrative Agent as of such date.
127
10.7 Independence of Covenants.
All covenants hereunder shall be given independent effect so
that if a particular action or condition is not permitted by any of such
covenants, the fact that it would be permitted by an exception to, or would
otherwise be within the limitations of, another covenant shall not avoid the
occurrence of an Event of Default or Potential Event of Default if such action
is taken or condition exists.
10.8 Notices.
Unless otherwise specifically provided herein, any notice or
other communication herein required or permitted to be given shall be in writing
and may be personally served, telecopied, telexed or sent by United States mail
or courier service and shall be deemed to have been given when delivered in
person or by courier service, upon receipt of telecopy or telex, or four
Business Days after depositing it in the United States mail, registered or
certified, with postage prepaid and properly addressed; provided that notices to
Administrative Agent shall not be effective until received. For the purposes
hereof, the address of each party hereto shall be as set forth under such
party's name on the signature pages hereof or (i) as to Company and
Administrative Agent, such other address as shall be designated by such Person
in a written notice delivered to the other parties hereto and (ii) as to each
other party, such other address as shall be designated by such party in a
written notice delivered to Administrative Agent.
10.9 Survival of Representations, Warranties and Agreements.
A. All representations, warranties and agreements made herein
shall survive the execution and delivery of this Agreement and the making of the
Loans and the issuance of the Letters of Credit hereunder.
B. Notwithstanding anything in this Agreement or implied by
law to the contrary, the agreements of Company set forth in subsections 2.6D,
2.7, 3.5A, 3.6, 10.2, 10.3 and 10.4 and the agreements of Lenders set forth in
subsections 9.2C, 9.4, 10.4, 10.5 and 10.20 shall survive the payment of the
Loans, the cancellation or expiration of the Letters of Credit and the
reimbursement of any amounts drawn or paid thereunder, and the termination of
this Agreement.
10.10 Failure or Indulgence Not Waiver; Remedies
Cumulative.
No failure or delay on the part of Administrative Agent or any
Lender in the exercise of any power, right or privilege hereunder or under any
other Loan Document shall impair such power, right or privilege or be construed
to be a waiver of any default or acquiescence therein, nor shall any single or
partial exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other power, right or privilege. All rights and
remedies existing under this Agreement and the other Loan Documents are
cumulative to, and not exclusive of, any rights or remedies otherwise available.
10.11 Marshalling; Payments Set Aside.
Neither Administrative Agent nor any Lender shall be under any
obligation to
128
marshal any assets in favor of Company or any other party or against or in
payment of any or all of the obligations. To the extent that Company makes a
payment or payments to Administrative Agent or Lenders (or to Administrative
Agent for the benefit of Lenders), or Administrative Agent or Lenders enforce
any security interests or exercise their rights of setoff, and such payment
or payments or the proceeds of such enforcement or setoff or any part thereof
are subsequently invalidated, declared to be fraudulent or preferential, set
aside and/or required to be repaid to a trustee, receiver or any other party
under any bankruptcy law, any other state or federal law, common law or any
equitable cause, then, to the extent of such recovery, the obligation or part
thereof originally intended to be satisfied, and all Liens, rights and
remedies therefor or related thereto, shall be revived and continued in full
force and effect as if such payment or payments had not been made or such
enforcement or setoff had not occurred.
10.12 Severability.
In case any provision in or obligation under this Agreement or
the Notes shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
10.13 Obligations Several; Independent Nature of Lenders'
Rights.
The obligations of Lenders hereunder are several and no Lender
shall be responsible for the obligations or Commitments of any other Lender
hereunder. Nothing contained herein or in any other Loan Document, and no action
taken by Lenders pursuant hereto or thereto, shall be deemed to constitute
Lenders as 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 and it shall not be necessary
for any other Lender to be joined as an additional party in any proceeding for
such purpose.
10.14 Headings.
Section and subsection headings in this Agreement are included
herein for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
10.15 Applicable Law.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT
LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
10.16 Successors and Assigns.
129
This Agreement shall be binding upon the parties hereto and
their respective successors and assigns and shall inure to the benefit of the
parties hereto and the successors and assigns of Lenders (it being understood
that Lenders' rights of assignment are subject to subsection 10.1). Neither
Company's rights nor obligations hereunder nor any interest therein may be
assigned or delegated by Company without the prior written consent of all
Lenders.
10.17 Consent to Jurisdiction and Service of Process.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST COMPANY ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY OBLIGATIONS
THEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN XXX XXXXX, XXXXXX XXX XXXX XX XXX XXXX. BY EXECUTING AND
DELIVERING THIS AGREEMENT, COMPANY, FOR ITSELF AND IN CONNECTION WITH ITS
PROPERTIES, IRREVOCABLY
(I) ACCEPTS GENERALLY AND UNCONDITIONALLY THE
NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS;
(II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS;
(III) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH
PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL, RETURN RECEIPT REQUESTED, TO COMPANY AT ITS ADDRESS PROVIDED IN
ACCORDANCE WITH SUBSECTION 10.8;
(IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (III)
ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER COMPANY IN ANY
SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE
AND BINDING SERVICE IN EVERY RESPECT;
(V) AGREES THAT LENDERS RETAIN THE RIGHT TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING
PROCEEDINGS AGAINST COMPANY IN THE COURTS OF ANY OTHER JURISDICTION;
AND
(VI) AGREES THAT THE PROVISIONS OF THIS SUBSECTION 10.17
RELATING TO JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO
THE FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW
SECTION 5-1402 OR OTHERWISE.
10.18 Waiver of Jury Trial.
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE
ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE
130
OTHER LOAN DOCUMENTS OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT
MATTER OF THIS LOAN TRANSACTION OR THE LENDER/ BORROWER RELATIONSHIP OR OTHER
RELATIONSHIP THAT IS BEING ESTABLISHED. The scope of this waiver is intended
to be all-encompassing of any and all disputes that may be filed in any court
and that relate to the subject matter of this transaction, including, without
limitation, contract claims, tort claims, breach of duty claims and all other
common law and statutory claims. Each party hereto acknowledges that this
waiver is a material inducement to enter into a business relationship, that
each has already relied on this waiver in entering into this Agreement, and
that each will continue to rely on this waiver in their related future
dealings. Each party hereto further warrants and represents that it has
reviewed this waiver with its legal counsel and that it knowingly and
voluntarily waives its jury trial rights following consultation with legal
counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED
EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER
SPECIFICALLY REFERRING TO THIS SUBSECTION 10.18 AND EXECUTED BY EACH OF THE
PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS
MADE HEREUNDER. In the event of litigation, this Agreement may be filed as a
written consent to a trial by the court.
10.19 Confidentiality.
Each Lender shall hold all non-public information obtained
pursuant to the requirements of this Agreement which has been identified as
confidential by Company in accordance with such Lender's customary procedures
for handling confidential information of this nature, it being understood and
agreed by Company that in any event a Lender may make disclosures reasonably
required by any Affiliate or any bona fide assignee, transferee or
participant in connection with the contemplated assignment or transfer by
such Lender of any Loans or any participation therein or as required or
requested by any governmental agency or representative thereof or pursuant to
legal process or by the National Association of Insurance Commissioners or in
connection with the exercise of any remedy under the Loan Documents; provided
that, unless specifically prohibited by applicable law or court order, each
Lender shall notify Company of any request by any governmental agency or
representative thereof (other than any such request in connection with any
examination of the financial condition of such Lender by such governmental
agency) for disclosure of any such non-public information prior to disclosure
of such information; and provided, further that in no event shall any Lender
be obligated or required to return any materials furnished by Company or any
of its Subsidiaries.
10.20 Counterparts; Effectiveness.
This Agreement and any amendments, waivers, consents or
supplements hereto or in connection herewith may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and attached
to a single counterpart so that all signature pages are physically attached to
the same document. This
131
Agreement shall become effective upon the execution of a counterpart hereof
by each of the parties hereto and receipt by Company and Administrative Agent
of written or telephonic notification of such execution and authorization of
delivery thereof.
132
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
COMPANY: AURORA FOODS INC.
By: /s/ Xxxxx X. Xxxxxx
--------------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice Chairman
Notice Address:
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: M. Xxxxxx Xxxxxxxx
Facsimile: (000) 000-0000
and a copy to:
White & Case
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Facsimile: (000) 000-0000
AGENTS AND LENDERS: THE CHASE MANHATTAN BANK,
individually and as Administrative Agent
By: /s/ Xxxxxx X. Xxxxxxx
---------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
Notice Address:
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
One Chase Xxxxxxxxx Xxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxxxxx
Loan Servicing Group
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
NATIONAL WESTMINSTER BANK PLC,
individually and as Syndication
Agent
By: /s/ Xxxxxxxxxx X. Xxxxxxxx
---------------------------
Name: Xxxxxxxxxx X. Xxxxxxxx
Title: Vice President
Notice Address:
Gleacher NatWest Inc.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: X. Xxxxxxxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
UBS AG, STAMFORD BRANCH
individually and as
Documentation Agent
By: /s/ Xxxx Xxxxxx
----------------------
Name: Xxxx Xxxxxx
Title: Associate Director
Loan Portfolio Support, US
By: /s/ Xxxxxx X. Xxxxxxx
----------------------
Name: Xxxxxx X. Xxxxxxx
Title: Associate Director
Loan Portfolio Support, US
Notice Address:
Warburg Dillon Read
000 Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
MARINE MIDLAND BANK
By: /s/ Xxxxx XxXxxxx
----------------------
Name: Xxxxx XxXxxxx
Title: Authorized Signatory
Notice Address:
Marine Midland Bank
000 Xxxxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
XXXXXX TRUST AND SAVINGS BANK
By: /s/ Xxxxx X. Xxxxxxx
---------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
Notice Address:
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx Xxxxxx
Xxxxx 00 Xxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
FLEET NATIONAL BANK
By: /s/ Xxxxxx X. Xxxxxxx
----------------------
Name: Xxxxxx X. Xxxxxxx
Title: Assistant Vice President
Notice Address:
Fleet National Bank
One Federal Street, MAOF0324
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
Fleet National Bank
1185 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
CREDIT AGRICOLE INDOSUEZ
By: /s/ Xxxx Xxxxxx By: /s/ W. Xxxxx Xxxxxx
--------------------------- ---------------------------
Name: Xxxx Xxxxxx Name: W. Xxxxx Xxxxxx
Title: Senior Vice President Title: Vice President
Branch Manager
Notice Address:
Credit Agricole Indosuez (Chicago)
00 Xxxx Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
U.S. BANK NATIONAL ASSOCIATION
By: /s/ Xxxx Xxxxxx
---------------------------
Name: Xxxx Xxxxxx
Title: Commercial Banking Officer
Notice Address:
U.S. Bank National Association
First Bank Place
MPFP 0702
000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
XXXXX FARGO BANK, N.A.
By: /s/ Xxxxxxx Xxxx
---------------------------
Name: Xxxxxxx Xxxx
Title: Assistant Vice President
Notice Address:
Xxxxx Fargo Bank, N.A.
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
an Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
SUNTRUST BANK, ATLANTA
By: /s/ Xxxx Melzon
-------------------------
Name: Xxxx Melzon
Title: Associate
By: /s/ Xxxxxx Xxxx
-------------------------
Name: Xxxxxx Xxxx
Title: Vice President
Notice Address:
SunTrust Bank, Atlanta
00 Xxxx Xxxxx, 00xx Xxxxx, XX 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxx XxXxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
SUMMIT BANK
By: /s/ Xxxxx X. Xxxxxxxx
---------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Treasurer
Notice Address:
Summit Bank
000 Xxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Notice Address:
Att: Xxxxx X. Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
PNC BANK, NATIONAL ASSOCIATION
By: /s/ C. Xxxxxx Xxxxxxxxxx
--------------------------
Name: C. Xxxxxx Xxxxxxxxxx
Title: Vice President
Notice Address:
PNC BANK
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
Attention: Xxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
NATIONAL CITY BANK
By: /s/ Xxxx X. Xxxx
---------------------------
Name: Xxxx X. Xxxx
Title: Assistant Vice President
Notice Address:
National City Bank
0000 Xxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
PARIBAS
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxx X. Xxxxxxx
--------------------------- ---------------------------
Name: Xxxxxx X. Xxxxxxx Name: Xxx X. Xxxxxxx
Title: Vice President Title: Managing Director
Notice Address:
Paribas
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
MITSUBISHI TRUST AND BANKING
By: /s/ Xxxxxxxx X. Xxxxxxx
---------------------------
Name: Xxxxxxxx X. Xxxxxxx
Title: Senior Vice President
Notice Address:
Mitsubishi Trust and Banking
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
BAYERISCHE VEREINSBANK
By: /s/ Xxxxx Xxxxx xxx Xxxxxxxxxx
--------------------------------
Name: Xxxxx Xxxxx xxx Xxxxxxxxxx
Title: Vice President
By: /s/ Xxxxxx Xxxxx
--------------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
Notice Address:
Bayerische Vereinsbank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
FIRST UNION NATIONAL BANK
By: /s/ Xxxxxxx X. Xxxxx
---------------------------
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
Notice Address:
First Union National Bank
First Union National Center
5th Floor
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: Xxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
BANQUE NATIONALE DE PARIS
By: /s/ Serge Besreyard By: /s/ Xxxxxxxxx Xxxxxx
--------------------------- ---------------------------
Name: Serge Besreyard Name: Xxxxxxxxx Xxxxxx
Title: Vice President Title: Vice President
Notice Address:
Banque Nationale de Paris
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
STAR BANK NATIONAL ASSOCIATION
By: /s/ Xxxx X. Xxxxxxx
---------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
Notice Address:
Star Bank
000 Xxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxxx, Xxxx 00000
Attention: Xxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
DLJ CAPITAL FUNDING, INC.
By: /s/ Xxxxxxx Illegible
---------------------------
Name:
Title:
Notice Address:
DLJ Capital Funding, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
THE TRAVELERS INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxxx
---------------------------
Name: Xxxxxx X. Xxxxxx
Title: Second Vice President
Notice Address:
The Travelers Insurance Company
Xxx Xxxxx Xxxxxx, 0XX
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
DEUTSCHE BANK AG NEW YORK BRANCH
AND/OR CAYMAN ISLANDS BRANCH
By: /s/ Xxxx-Xxxxx Xxxxxx By: /s/ Xxxxx X. Xxxxxxx
--------------------------- ---------------------------
Name: Xxxx-Xxxxx Xxxxxx Name: Xxxxx X. Xxxxxxx
Title: Director Title: Director
Notice Address:
Deutsche Xxxxxx Xxxxxxxx
00 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
ANNEX A
TO CREDIT AGREEMENT
PRICING GRID
RATIO OF CONSOLIDATED TOTAL DEBT TO CONSOLIDATED EBITDA
Less than
5.25 but Less than Less than Less than Less than
Greater 5:00 but 4.75:1 but 4.25:1 but 3.75:1 but
Greater than than or Greater than Greater than Greater than Greater than
or Equal to Equal or Equal to or Equal to or Equal to or Equal to Less Than
5:25:1 to 5:00:1 4:75:1 4.25:1 3.75:1 3.25:1 3.25:1
------------ ----------- ------------ ------------ -------------- -------------- -----------
Applicable Margin for
Revolving Credit Loans and
Tranche A Term Loans:
ABR Loans................... 1.25% 1.00% 0.75% 0.50% 0.25% 0.00% 0.00%
Eurodollar Loans............ 2.25% 2.00% 1.75% 1.50% 1.25% 1.00% 0.875%
Applicable Margin for
Commitment Fee:............. 0.50% 0.50% 0.375% 0.375% 0.375% 0.30% 0.30%
Exhibit 10.20
EXHIBIT I
[FORM OF NOTICE OF BORROWING]
NOTICE OF BORROWING
Pursuant to that certain Third Amended and Restated Credit Agreement
dated as of July 1, 1998, as amended, restated, supplemented or otherwise
modified to the date hereof (said Third Amended and Restated Credit Agreement,
as so amended, restated, supplemented or otherwise modified, being the "Credit
Agreement", the terms defined therein and not otherwise defined herein being
used herein as therein defined), by and among Aurora Foods Inc., a Delaware
corporation ("Company"), the financial institutions listed therein as Lenders,
The Chase Manhattan Bank, as administrative agent (in such capacity,
"Administrative Agent"), National Westminster Bank PLC, as Syndication Agent,
and UBS AG, Stamford Branch, as Documentation Agent, this represents Company's
request to borrow as follows:
1. Date of borrowing: ______________, [199_] [200_]
2. Amount of borrowing: $_____________________
3. Lender(s): / / a. Lenders, in accordance with their
applicable Pro Rata Shares
/ / b. Swing Line Lender
4. Type of Loans: / / a. Tranche A Term Loans
/ / b. Revolving Loans
/ / c. Swing Line Loan
5. Interest rate option:(1) / / a. Base Rate Loan(s)
/ / b. Eurodollar Rate Loans with an
initial Interest Period of
__________ month(s)
The proceeds of such Loans are to be deposited in Company's account at
Administrative Agent.
The undersigned officer, to the best of his or her knowledge, and
_____________________
(1) Term Loans and Revolving Loans may be Base Rate Loans or
Eurodollar Rate Loans. Swing Line Loans shall be Base Rate Loans.
I-1
Company certify that:
(i) The representations and warranties contained in the Credit
Agreement and the other Loan Documents are true and correct in all material
respects on and as of the date hereof to the same extent as though made on
and as of the date hereof, except to the extent such representations and
warranties specifically relate to an earlier date, in which case such
representations and warranties were true and correct in all material
respects on and as of such earlier date;
(ii) No event has occurred and is continuing or would result from
the consummation of the borrowing contemplated hereby that would constitute
an Event of Default or a Potential Event of Default; [and]
(iii) Company has performed in all material respects all
agreements and satisfied all conditions which the Credit Agreement provides
shall be performed or satisfied by it on or before the date hereof [; and]
[.]
[(iv) FOR REVOLVING LOANS: The amount of the proposed borrowing
will not cause the Total Utilization of Revolving Loan Commitments to
exceed the Revolving Loan Commitments.]
DATED:___________________ AURORA FOODS INC.
By:____________________________
Name:
Title:
I-2
EXHIBIT II
[FORM OF NOTICE OF CONVERSION/CONTINUATION]
NOTICE OF CONVERSION/CONTINUATION
Pursuant to that certain Third Amended and Restated Credit Agreement
dated as of July 1, 1998, as amended, restated, supplemented or otherwise
modified to the date hereof (said Third Amended and Restated Credit Agreement,
as so amended, restated, supplemented or otherwise modified, being the "Credit
Agreement", the terms defined therein and not otherwise defined herein being
used herein as therein defined), by and among Aurora Foods Inc., a Delaware
corporation ("Company"), the financial institutions listed therein as Lenders,
The Chase Manhattan Bank, as Administrative Agent, National Westminster Bank
PLC, as Syndication Agent, and UBS AG, Stamford Branch, as Documentation Agent,
this represents Company's request to convert or continue Loans as follows:
1. Date of conversion/continuation: __________________, [199_] [200_]
2. Amount of Loans being converted/continued: $__________________
3. Type of Loans being converted/continued:
/ / a. Tranche A Term Loans
/ / b. Revolving Loans
4. Nature of conversion/continuation:
/ / a. Conversion of Base Rate Loans to Eurodollar Rate Loans
/ / b. Conversion of Eurodollar Rate Loans to Base Rate Loans
/ / c. Continuation of Eurodollar Rate Loans as such
5. If Loans are being continued as or converted to Eurodollar Rate Loans,
the duration of the new Interest Period that commences on the
conversion/continuation date: ________________ month(s)
II-1
In the case of a conversion to or continuation of Eurodollar Rate
Loans, the undersigned officer, to the best of his or her knowledge, and Company
certify that no Event of Default or Potential Event of Default has occurred and
is continuing under the Credit Agreement.
DATED: _________________ AURORA FOODS INC.
By:____________________________
Name:
Title:
II-2
EXHIBIT III
[FORM OF NOTICE OF ISSUANCE OF LETTER OF CREDIT]
NOTICE OF ISSUANCE OF LETTER OF CREDIT
Pursuant to that certain Third Amended and Restated Credit Agreement
dated as of July 1, 1998, as amended, restated, supplemented or otherwise
modified to the date hereof (said Third Amended and Restated Credit Agreement,
as so amended, restated, supplemented or otherwise modified, being the "Credit
Agreement", the terms defined therein and not otherwise defined herein being
used herein as therein defined), by and among Aurora Foods Inc., a Delaware
corporation ("Company"), the financial institutions listed therein as Lenders,
The Chase Manhattan Bank as Administrative Agent, National Westminster Bank PLC,
as Syndication Agent, and UBS AG, Stamford Branch, as Documentation Agent, this
represents Company's request for the issuance of a Letter of Credit by
Administrative Agent as follows:
1. Date of issuance of Letter of Credit:
_______________, [199_] [200_]
2. Type of Letter of Credit:
/ / a. Commercial Letter of Credit
/ / b. Standby Letter of Credit
3. Face amount of Letter of Credit: $________________
4. Expiration date of Letter of Credit: ______________, [199_]
[200_]
5. Name and address of beneficiary:
_______________________________________________
_______________________________________________
_______________________________________________
_______________________________________________
6. Attached hereto is:
/ / a. the verbatim text of such proposed Letter of Credit
/ / b. a description of the proposed terms and conditions of such
Letter of Credit, including a precise description of any
documents to be presented by the beneficiary which, if
presented by the beneficiary prior to the expiration date of
such Letter of Credit, would require the Issuing Lender to
make payment under such Letter of Credit.
The undersigned officer, to the best of his or her knowledge, and
III-1
Company certify that:
(i) The representations and warranties contained in the Credit
Agreement and the other Loan Documents are true and correct in all material
respects on and as of the date hereof to the same extent as though made on
and as of the date hereof, except to the extent such representations and
warranties specifically relate to an earlier date, in which case such
representations and warranties were true and correct in all material
respects on and as of such earlier date;
(ii) No event has occurred and is continuing or would result from
the issuance of the Letter of Credit contemplated hereby that would
constitute an Event of Default or a Potential Event of Default;
(iii) Company has performed in all material respects all
agreements and satisfied all conditions which the Credit Agreement provides
shall be performed or satisfied by it on or before the date hereof; and
(iv) The issuance of the proposed Letter of Credit will not cause
(a) the Letter of Credit Usage to exceed $7,500,000 or (b) the Total
Utilization of Revolving Loan Commitments to exceed the Revolving Loan
Commitments.
DATED: _________________ AURORA FOODS INC.
By:__________________________
Name:
Title:
III-2
EXHIBIT IV
[FORM OF TRANCHE A TERM NOTE]
AURORA FOODS INC.
PROMISSORY NOTE DUE JUNE 30, 2005
$[1] New York, New York
July 1, 1998
FOR VALUE RECEIVED, AURORA FOODS INC., a Delaware corporation
("Company"), promises to pay to [2] ("Payee") or its registered assigns the
principal amount of [3] ($[1]) in the installments referred to below.
Company also promises to pay interest on the unpaid principal amount
hereof, from the date hereof until paid in full, at the rates and at the times
which shall be determined in accordance with the provisions of that certain
Third Amended and Restated Credit Agreement dated as of July 1, 1998, by and
among Company, the financial institutions listed therein as Lenders, The Chase
Manhattan Bank, as administrative agent (in such capacity, "Administrative
Agent"), National Westminster Bank PLC, as Syndication Agent, and UBS AG,
Stamford Branch, as Documentation Agent (said Third Amended and Restated Credit
Agreement, as it may be amended, restated, supplemented or otherwise modified
from time to time, being the "Credit Agreement", the terms defined therein and
not otherwise defined herein being used herein as therein defined).
Company shall make principal payments on this Note in consecutive
quarterly installments as set forth in the Credit Agreement, commencing on
December 31, 1998 and ending on June 30, 2005. Each such installment shall be
due on the date specified in the Credit Agreement and in an amount determined in
accordance with the provisions thereof; provided that the last such installment
shall be in an amount sufficient to repay the entire unpaid principal balance of
this Note, together with all accrued and unpaid interest thereon.
____________________
[1] Insert amount of Lender's Tranche A Term Loan in numbers.
[2] Insert Lender's name in capital letters.
[3] Insert amount of Lender's Tranche A Term Loan in words.
This Note is one of Company's "Tranche A Term Notes" in the aggregate
principal amount of $225,000,000 and is issued
IV-1
pursuant to and entitled to the benefits of the Credit Agreement, to which
reference is hereby made for a more complete statement of the terms and
conditions under which the Tranche A Term Loan evidenced hereby was made and
is to be repaid.
All payments of principal and interest in respect of this Note shall
be made in lawful money of the United States of America in same day funds at the
Funding and Payment Office or at such other place as shall be designated in
writing for such purpose in accordance with the terms of the Credit Agreement.
Unless and until an Assignment Agreement effecting the assignment or transfer of
this Note shall have been accepted by Administrative Agent and recorded in the
Register as provided in subsection 10.1B(ii) of the Credit Agreement, Company
and Administrative Agent shall be entitled to deem and treat Payee as the owner
and holder of this Note and the Loan evidenced hereby. Payee hereby agrees, by
its acceptance hereof, that before disposing of this Note or any part hereof it
will make a notation hereon of all principal payments previously made hereunder
and of the date to which interest hereon has been paid; provided, however, that
the failure to make a notation of any payment made on this Note shall not limit
or otherwise affect the obligations of Company hereunder with respect to
payments of principal of or interest on this Note.
Whenever any payment on this Note shall be stated to be due on a day
which is not a Business Day, such payment shall be made on the next succeeding
Business Day and such extension of time shall be included in the computation of
the payment of interest on this Note.
This Note is subject to mandatory prepayment as provided in subsection
2.4B(iii) of the Credit Agreement and to prepayment at the option of Company as
provided in subsection 2.4B(i) of the Credit Agreement.
THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF COMPANY AND PAYEE
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT
LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
Upon the occurrence of an Event of Default, the unpaid balance of the
principal amount of this Note, together with all accrued and unpaid interest
thereon, may become, or may be declared to be, due and payable in the manner,
upon the conditions and with the effect provided in the Credit Agreement.
This Note is entitled to the benefits of the Guaranties and is secured
pursuant to the Collateral Documents.
The terms of this Note are subject to amendment only in the manner
provided in the Credit Agreement.
This Note is subject to restrictions on transfer or assignment as
provided in subsections 10.1 and 10.16 of the
IV-2
Credit Agreement.
No reference herein to the Credit Agreement and no provision of this
Note or the Credit Agreement shall alter or impair the obligations of Company,
which are absolute and unconditional, to pay the principal of and interest on
this Note at the place, at the respective times, and in the currency herein
prescribed.
Company promises to pay all costs and expenses, including reasonable
attorneys' fees, all as provided in subsection 10.2 of the Credit Agreement,
incurred in the collection and enforcement of this Note. Company and any
endorsers of this Note hereby consent to renewals and extensions of time at or
after the maturity hereof, without notice, and hereby waive diligence,
presentment, protest, demand and notice of every kind and, to the full extent
permitted by law, the right to plead any statute of limitations as a defense to
any demand hereunder.
IN WITNESS WHEREOF, Company has caused this Note to be duly executed
and delivered by its officer thereunto duly authorized as of the date and at the
place first written above.
AURORA FOODS INC.
By:______________________
Name:
Title:
IV-3
EXHIBIT V
[FORM OF REVOLVING NOTE]
AURORA FOODS INC.
PROMISSORY NOTE DUE JUNE 30, 2005
$[1] New York, New York
July 1, 1998
FOR VALUE RECEIVED, AURORA FOODS INC., a Delaware corporation
("Company"), promises to pay to the order of [2] ("Payee") or its registered
assigns, on or before June 30, 2005, the lesser of (x) [3] ($[1]) and (y) the
unpaid principal amount of all advances made by Payee to Company as Revolving
Loans under the Credit Agreement referred to below.
Company also promises to pay interest on the unpaid principal amount
hereof, from the date hereof until paid in full, at the rates and at the times
which shall be determined in accordance with the provisions of that certain
Third Amended and Restated Credit Agreement dated as of July 1, 1998 by and
among Company, the financial institutions listed therein as Lenders, The Chase
Manhattan Bank, as administrative agent (in such capacity, "Administrative
Agent"), National Westminster Bank PLC, as Syndication Agent, and UBS AG,
Stamford Branch, as Documentation Agent (said Third Amended and Restated Credit
Agreement, as it may be amended, restated, supplemented or otherwise modified
from time to time, being the "Credit Agreement", the terms defined therein and
not otherwise defined herein being used herein as therein defined).
This Note is one of Company's "Revolving Notes" in the aggregate
principal amount of $175,000,000 and is issued pursuant to and entitled to the
benefits of the Credit Agreement, to which reference is hereby made for a more
complete statement of the terms and conditions under which the Revolving Loans
evidenced hereby were made and are to be repaid.
All payments of principal and interest in respect of this Note shall
be made in lawful money of the United States of America in same day funds at the
Funding and Payment Office or at such other place as shall be designated in
writing for such purpose in accordance with the terms of the Credit Agreement.
Unless and until an Assignment Agreement effecting the
____________________
[1] Insert amount of Lender's Revolving Loan Commitment in numbers.
[2] Insert Lender's name in capital letters.
[3] Insert amount of Lender's Revolving Loan Commitment in words.
V-1
assignment or transfer of this Note shall have been accepted by Administrative
Agent and recorded in the Register as provided in subsection 10.1B(ii) of the
Credit Agreement, Company and Administrative Agent shall be entitled to deem and
treat Payee as the owner and holder of this Note and the Loans evidenced hereby.
Payee hereby agrees, by its acceptance hereof, that before disposing of this
Note or any part hereof it will make a notation hereon of all principal payments
previously made hereunder and of the date to which interest hereon has been
paid; provided, however, that the failure to make a notation of any payment made
on this Note shall not limit or otherwise affect the obligations of Company
hereunder with respect to payments of principal of or interest on this Note.
Whenever any payment on this Note shall be stated to be due on a day
which is not a Business Day, such payment shall be made on the next succeeding
Business Day and such extension of time shall be included in the computation of
the payment of interest on this Note.
This Note is subject to mandatory prepayment as provided in subsection
2.4B(iii) of the Credit Agreement and to prepayment at the option of Company as
provided in subsection 2.4B(i) of the Credit Agreement.
THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF COMPANY AND PAYEE
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT
LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
Upon the occurrence of an Event of Default, the unpaid balance of the
principal amount of this Note, together with all accrued and unpaid interest
thereon, may become, or may be declared to be, due and payable in the manner,
upon the conditions and with the effect provided in the Credit Agreement.
This Note is entitled to the benefits of the Guaranties and is secured
pursuant to the Collateral Documents.
The terms of this Note are subject to amendment only in the manner
provided in the Credit Agreement.
This Note is subject to restrictions on transfer or assignment as
provided in subsections 10.1 and 10.16 of the Credit Agreement.
No reference herein to the Credit Agreement and no provision of this
Note or the Credit Agreement shall alter or impair the obligations of Company,
which are absolute and unconditional, to pay the principal of and interest on
this Note at the place, at the respective times, and in the currency herein
prescribed.
Company promises to pay all costs and expenses, including reasonable
attorneys' fees, all as provided in
V-2
subsection 10.2 of the Credit Agreement, incurred in the collection and
enforcement of this Note. Company and any endorsers of this Note hereby
consent to renewals and extensions of time at or after the maturity hereof,
without notice, and hereby waive diligence, presentment, protest, demand and
notice of every kind and, to the full extent permitted by law, the right to
plead any statute of limitations as a defense to any demand hereunder.
IN WITNESS WHEREOF, Company has caused this Note to be duly executed
and delivered by its officer thereunto duly authorized as of the date and at the
place first written above.
AURORA FOODS INC.
By:________________________
Name:
Title:
V-3
TRANSACTIONS
ON
REVOLVING NOTE
Amount of Outstanding
Type of Amount of Principal Principal
Loan Made Loan Made Paid Balance Notation
Date This Date This Date This Date This Date Made By
---------- --------- --------- --------- ----------- --------
---------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------
V-4
EXHIBIT VI
[FORM OF SWING LINE NOTE]
AURORA FOODS INC.
PROMISSORY NOTE DUE JUNE 30, 2005
$10,000,000 New York, New York
July 1, 1998
FOR VALUE RECEIVED, AURORA FOODS INC., a Delaware corporation
("Company"), promises to pay to [NAME OF SWING LINE LENDER] ("Payee") or its
registered assigns, on or before June 30, 2005, the lesser of (x) TEN MILLION
AND NO DOLLARS ($10,000,000.00) and (y) the unpaid principal amount of all
advances made by Payee to Company as Swing Line Loans under the Credit Agreement
referred to below.
Company also promises to pay interest on the unpaid principal amount
hereof, from the date hereof until paid in full, at the rates and at the times
which shall be determined in accordance with the provisions of that certain
Third Amended and Restated Credit Agreement dated as of July 1, 1998, by and
among Company, the financial institutions listed therein as Lenders, The Chase
Manhattan Bank as administrative agent (in such capacity, "Administrative
Agent") National Westminster Bank PLC, as Syndication Agent, and UBS AG,
Stamford Branch, as Documentation Agent (said Third Amended and Restated Credit
Agreement, as it may be amended, restated, supplemented or otherwise modified
from time to time, being the "Credit Agreement", the terms defined therein and
not otherwise defined herein being used herein as therein defined).
This Note is Company's "Swing Line Note" and is issued pursuant to and
entitled to the benefits of the Credit Agreement, to which reference is hereby
made for a more complete statement of the terms and conditions under which the
Swing Line Loans evidenced hereby were made and are to be repaid.
All payments of principal and interest in respect of this Note shall
be made in lawful money of the United States of America in same day funds at the
Funding and Payment Office or at such other place as shall be designated in
writing for such purpose in accordance with the terms of the Credit Agreement.
Whenever any payment on this Note shall be stated to be due on a day
which is not a Business Day, such payment shall be made on the next succeeding
Business Day and such extension of time shall be included in the computation of
the payment of interest on this Note.
This Note is subject to mandatory prepayment as provided in subsection
2.4B(iii) of the Credit Agreement and to prepayment at the option of Company as
provided in subsection
VI-1
2.4B(i) of the Credit Agreement.
THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF COMPANY AND PAYEE
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT
LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
Upon the occurrence of an Event of Default, the unpaid balance of the
principal amount of this Note, together with all accrued and unpaid interest
thereon, may become, or may be declared to be, due and payable in the manner,
upon the conditions and with the effect provided in the Credit Agreement.
This Note is entitled to the benefits of the Guaranties and is secured
pursuant to the Collateral Documents.
The terms of this Note are subject to amendment only in the manner
provided in the Credit Agreement.
This Note is subject to restrictions on transfer or assignment as
provided in subsections 10.1 and 10.16 of the Credit Agreement.
No reference herein to the Credit Agreement and no provision of this
Note or the Credit Agreement shall alter or impair the obligations of Company,
which are absolute and unconditional, to pay the principal of and interest on
this Note at the place, at the respective times, and in the currency herein
prescribed.
Company promises to pay all costs and expenses, including reasonable
attorneys' fees, all as provided in subsection 10.2 of the Credit Agreement,
incurred in the collection and enforcement of this Note. Company and any
endorsers of this Note hereby consent to renewals and extensions of time at or
after the maturity hereof, without notice, and hereby waive diligence,
presentment, protest, demand and notice of every kind and, to the full extent
permitted by law, the right to plead any statute of limitations as a defense to
any demand hereunder.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, Company has caused this Note to be duly executed and
delivered by its officer thereunto duly authorized as of the date and at the
place first written above.
AURORA FOODS INC.
By:________________________
Name:
Title:
VI-2
TRANSACTIONS
ON
SWING LINE NOTE
Outstanding
Amount of Amount of Principal
Loan Made Principal Paid Balance Notation
Date This Date This Date This Date Made By
-------- --------- -------------- ------------ --------
----------------------------------------------------------------------------------
----------------------------------------------------------------------------------
----------------------------------------------------------------------------------
VI-3
EXHIBIT VII
[FORM OF SUBSIDIARY GUARANTY]
SUBSIDIARY GUARANTY
This SUBSIDIARY GUARANTY is entered into as of ______________,
[199_][200_] by THE UNDERSIGNED DIRECT AND INDIRECT SUBSIDIARIES of Aurora
Foods Inc., a Delaware corporation ("Company") (each such undersigned
Subsidiary a "Guarantor" and collectively, "Guarantors"; provided that after
the date hereof, Guarantors shall be deemed to include any Additional
Guarantors (as hereinafter defined)), in favor of and for the benefit of THE
CHASE MANHATTAN BANK, as administrative agent for and representative of (in
such capacity herein called "Guarantied Party") the financial institutions
("Lenders") party to the Credit Agreement referred to below and any Interest
Rate Exchangers (as hereinafter defined).
RECITALS
A. Company has entered into that certain Third Amended and
Restated Credit Agreement dated as of July 1, 1998 (said Third Amended and
Restated Credit Agreement, as amended, restated, supplemented or otherwise
modified from time to time, being the "Credit Agreement"; capitalized terms
defined therein and not otherwise defined herein being used herein as therein
defined) with Lenders, The Chase Manhattan Bank, as Administrative Agent,
National Westminster Bank PLC, as Syndication Agent, and UBS AG, Stamford
Branch, as Documentation Agent.
B. Company may from time to time enter, or may from time to time
have entered, into one or more Interest Rate Agreements (collectively, the
"Lender Interest Rate Agreements") with or one or more Lenders or their
Affiliates (in such capacity, collectively, "Interest Rate Exchangers") in
accordance with the terms of the Credit Agreement, and it is desired that the
obligations of Company under the Lender Interest Rate Agreements, including
without limitation the obligation of Company to make payments thereunder in
the event of early termination thereof (all such obligations being the
"Interest Rate Obligations"), together with all obligations of Company under
the Credit Agreement and the other Loan Documents, be guarantied hereunder.
C. A portion of the proceeds of the Loans may be advanced to
Guarantors and thus the Guarantied Obligations (as hereinafter defined) are
being incurred for and will inure to the benefit of Guarantors (which
benefits are hereby acknowledged).
D. It is a condition precedent to the making of the initial Loans
under the Credit Agreement that Company's obligations thereunder be
guarantied by Guarantors.
VII-1
E. Guarantors are willing irrevocably and unconditionally to
guaranty such obligations of Company.
NOW, THEREFORE, based upon the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and in order to induce Lenders and Guarantied Party to enter
into the Credit Agreement and to make Loans and other extensions of credit
thereunder and to induce Interest Rate Exchangers to enter into the Lender
Interest Rate Agreements, Guarantors hereby agree as follows:
SECTION 1.
DEFINITIONS
1.1 Certain Defined Terms.
As used in this Guaranty, the following terms shall have the following
meanings unless the context otherwise requires:
"Beneficiaries" means Guarantied Party, Lenders and any Interest Rate
Exchangers.
"Guarantied Obligations" has the meaning assigned to that term in
subsection 2.1.
"Guaranty" means this Subsidiary Guaranty dated as of __________,
[199_][200_], as it may be amended, restated, supplemented or otherwise
modified from time to time.
"payment in full", "paid in full" or any similar term means payment in
full of the Guarantied Obligations, including without limitation all
principal, interest, costs, fees and expenses (including without limitation
legal fees and expenses) of Beneficiaries as required under the Loan
Documents and the Lender Interest Rate Agreements.
1.2 Interpretation.
(a) References to "Sections" and "subsections" shall be to
Sections and subsections, respectively, of this Guaranty unless otherwise
specifically provided.
(b) In the event of any conflict or inconsistency between the
terms, conditions and provisions of this Guaranty and the terms, conditions
and provisions of the Credit Agreement, the terms, conditions and provisions
of this Guaranty shall prevail.
VII-2
SECTION 2.
THE GUARANTY
2.1 Guaranty of the Guarantied Obligations.
Subject to the provisions of subsection 2.2(a), Guarantors jointly and
severally hereby irrevocably and unconditionally guaranty the due and punctual
payment in full of all Guarantied Obligations when the same shall become due,
whether at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise (including amounts that would become due but for the
operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11
U.S.C. Section 362(a)). The term "Guarantied Obligations" is used herein in its
most comprehensive sense and includes:
(a) any and all Obligations of Company and any and all Interest Rate
Obligations, in each case now or hereafter made, incurred or created,
whether absolute or contingent, liquidated or unliquidated, whether due or
not due, and however arising under or in connection with the Credit
Agreement and the other Loan Documents and the Lender Interest Rate
Agreements, including those arising under successive borrowing transactions
under the Credit Agreement which shall either continue the Obligations of
Company or from time to time renew them after they have been satisfied and
including interest which, but for the filing of a petition in bankruptcy
with respect to Company, would have accrued on any Guarantied Obligations,
whether or not a claim is allowed against Company for such interest in the
related bankruptcy proceeding; and
(b) those expenses set forth in subsection 2.8 hereof.
2.2 Limitation on Amount Guarantied; Contribution by Guarantors.
(a) Anything contained in this Guaranty to the contrary
notwithstanding, if any Fraudulent Transfer Law (as hereinafter defined) is
determined by a court of competent jurisdiction to be applicable to the
obligations of any Guarantor under this Guaranty, the obligations of such
Guarantor hereunder shall be limited to a maximum aggregate amount equal to
the largest amount that would not render its obligations hereunder subject to
avoidance as a fraudulent transfer or conveyance under Section 548 of Title
11 of the United States Code or any applicable provisions of comparable state
law (collectively, the "Fraudulent Transfer Laws"), in each case after giving
effect to all other liabilities of such Guarantor, contingent or otherwise,
that are relevant under the Fraudulent Transfer Laws (specifically excluding,
however, any liabilities of such Guarantor (i) in respect of intercompany
indebtedness to Company or other affiliates of Company to the extent that
such indebtedness would be discharged in an amount equal to the amount paid
by such Guarantor hereunder and (ii) under any guaranty of
VII-3
Subordinated Indebtedness which guaranty contains a limitation as to maximum
amount similar to that set forth in this subsection 2.2(a), pursuant to which
the liability of such Guarantor hereunder is included in the liabilities
taken into account in determining such maximum amount) and after giving
effect as assets to the value (as determined under the applicable provisions
of the Fraudulent Transfer Laws) of any rights to subrogation, reimbursement,
indemnification or contribution of such Guarantor pursuant to applicable law
or pursuant to the terms of any agreement (including without limitation any
such right of contribution under subsection 2.2(b)).
(b) Guarantors under this Guaranty together desire to allocate
among themselves (collectively, the "Contributing Guarantors"), in a fair and
equitable manner, their obligations arising under this Guaranty.
Accordingly, in the event any payment or distribution is made on any date by
any Guarantor under this Guaranty (a "Funding Guarantor") that exceeds its
Fair Share (as defined below) as of such date, that Funding Guarantor shall
be entitled to a contribution from each of the other Contributing Guarantors
in the amount of such other Contributing Guarantor's Fair Share Shortfall (as
defined below) as of such date, with the result that all such contributions
will cause each Contributing Guarantor's Aggregate Payments (as defined
below) to equal its Fair Share as of such date. "Fair Share" means, with
respect to a Contributing Guarantor as of any date of determination, an
amount equal to (i) the ratio of (x) the Fair Share Contribution Amount (as
defined below) with respect to such Contributing Guarantor to (y) the
aggregate of the Fair Share Contribution Amounts with respect to all
Contributing Guarantors multiplied by (ii) the aggregate amount paid or
distributed on or before such date by all Funding Guarantors under this
Guaranty in respect of the obligations guarantied. "Fair Share Shortfall"
means, with respect to a Contributing Guarantor as of any date of
determination, the excess, if any, of the Fair Share of such Contributing
Guarantor over the Aggregate Payments of such Contributing Guarantor. "Fair
Share Contribution Amount" means, with respect to a Contributing Guarantor as
of any date of determination, the maximum aggregate amount of the obligations
of such Contributing Guarantor under this Guaranty determined as of such
date, in the case of any Guarantor, in accordance with subsection 2.2(a);
provided that, solely for purposes of calculating the "Fair Share
Contribution Amount" with respect to any Contributing Guarantor for purposes
of this subsection 2.2(b), any assets or liabilities of such Contributing
Guarantor arising by virtue of any rights to subrogation, reimbursement or
indemnification or any rights to or obligations of contribution hereunder
shall not be considered as assets or liabilities of such Contributing
Guarantor. "Aggregate Payments" means, with respect to a Contributing
Guarantor as of any date of determination, an amount equal to (i) the
aggregate amount of all payments and distributions made on or before such
date by such Contributing Guarantor in respect of this Guaranty (including in
respect of this subsection 2.2(b)) minus (ii) the aggregate amount of all
payments received on or before such date by such Contributing Guarantor from
the other Contributing Guarantors as
VII-4
contributions under this subsection 2.2(b). The amounts payable as
contributions hereunder shall be determined as of the date on which the
related payment or distribution is made by the applicable Funding Guarantor.
The allocation among Contributing Guarantors of their obligations as set
forth in this subsection 2.2(b) shall not be construed in any way to limit
the liability of any Contributing Guarantor hereunder.
2.3 Payment by Guarantors: Application of Payments.
Subject to the provisions of subsection 2.2(a), Guarantors hereby
jointly and severally agree, in furtherance of the foregoing and not in
limitation of any other right which any Beneficiary may have at law or in
equity against any Guarantor by virtue hereof, that upon the failure of
Company to pay any of the Guarantied Obligations when and as the same shall
become due, whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise (including amounts that would become due
but for the operation of the automatic stay under Section 362(a) of the
Bankruptcy Code, 11 U.S.C. Section 362(a)), Guarantors will upon demand pay,
or cause to be paid, in cash, to Guarantied Party for the ratable benefit of
Beneficiaries, an amount equal to the sum of the unpaid principal amount of
all Guarantied Obligations then due as aforesaid, accrued and unpaid interest
on such Guarantied Obligations (including without limitation interest which,
but for the filing of a petition in bankruptcy with respect to Company, would
have accrued on such Guarantied Obligations, whether or not a claim is
allowed against Company for such interest in the related bankruptcy
proceeding) and all other Guarantied Obligations then owed to Beneficiaries
as aforesaid. All such payments shall be applied promptly from time to time
by Guarantied Party as provided in subsection 2.4D of the Credit Agreement.
2.4 Liability of Guarantors Absolute.
Each Guarantor agrees that its obligations hereunder are
irrevocable, absolute, independent and unconditional and shall not be
affected by any circumstance which constitutes a legal or equitable discharge
of a guarantor or surety other than payment in full of the Guarantied
Obligations. In furtherance of the foregoing and without limiting the
generality thereof, each Guarantor agrees as follows:
(a) This Guaranty is a guaranty of payment when due and not of
collectibility.
(b) Guarantied Party may enforce this Guaranty upon the occurrence of
an Event of Default under the Credit Agreement or the occurrence of an
Early Termination Date (as defined in a Master Agreement or an Interest
Rate Swap Agreement or Interest Rate and Currency Exchange Agreement in the
form prepared by the International Swap and Derivatives Association Inc. or
a similar event under any similar swap agreement) under any Lender Interest
Rate Agreement (either such occurrence being an "Event of
VII-5
Default" for purposes of this Guaranty) notwithstanding the existence of
any dispute between Company and any Beneficiary with respect to the
existence of such Event of Default.
(c) The obligations of each Guarantor hereunder are independent of
the obligations of Company under the Loan Documents or the Lender Interest
Rate Agreements and the obligations of any other guarantor (including any
other Guarantor) of the obligations of Company under the Loan Documents or
the Lender Interest Rate Agreements, and a separate action or actions may
be brought and prosecuted against such Guarantor whether or not any action
is brought against Company or any of such other guarantors and whether or
not Company is joined in any such action or actions.
(d) Payment by any Guarantor of a portion, but not all, of the
Guarantied Obligations shall in no way limit, affect, modify or abridge any
Guarantor's liability for any portion of the Guarantied Obligations which
has not been paid. Without limiting the generality of the foregoing, if
Guarantied Party is awarded a judgment in any suit brought to enforce any
Guarantor's covenant to pay a portion of the Guarantied Obligations, such
judgment shall not be deemed to release such Guarantor from its covenant to
pay the portion of the Guarantied Obligations that is not the subject of
such suit, and such judgment shall not, except to the extent satisfied by
such Guarantor, limit, affect, modify or abridge any other Guarantor's
liability hereunder in respect of the Guarantied Obligations.
(e) Any Beneficiary, upon such terms as it deems appropriate, without
notice or demand and without affecting the validity or enforceability of
this Guaranty or giving rise to any reduction, limitation, impairment,
discharge or termination of any Guarantor's liability hereunder, from time
to time may (i) renew, extend, accelerate, increase the rate of interest
on, or otherwise change the time, place, manner or terms of payment of the
Guarantied Obligations, (ii) settle, compromise, release or discharge, or
accept or refuse any offer of performance with respect to, or substitutions
for, the Guarantied Obligations or any agreement relating thereto and/or
subordinate the payment of the same to the payment of any other
obligations; (iii) request and accept other guaranties of the Guarantied
Obligations and take and hold security for the payment of this Guaranty or
the Guarantied Obligations; (iv) release, surrender, exchange, substitute,
compromise, settle, rescind, waive, alter, subordinate or modify, with or
without consideration, any security for payment of the Guarantied
Obligations, any other guaranties of the Guarantied Obligations, or any
other obligation of any Person (including any other Guarantor) with respect
to the Guarantied Obligations; (v) enforce and apply any security now or
hereafter held by or for the benefit of such Beneficiary in respect of this
Guaranty or the Guarantied Obligations and direct the order or manner of
sale thereof,
VII-6
or exercise any other right or remedy that such Beneficiary may have
against any such security, in each case as such Beneficiary in its
discretion may determine consistent with the Credit Agreement or the
applicable Lender Interest Rate Agreement and any applicable security
agreement, including foreclosure on any such security pursuant to one or
more judicial or nonjudicial sales, whether or not every aspect of any
such sale is commercially reasonable, and even though such action
operates to impair or extinguish any right of reimbursement or
subrogation or other right or remedy of any Guarantor against Company or
any security for the Guarantied Obligations; and (vi) exercise any other
rights available to it under the Loan Documents or the Lender Interest
Rate Agreements.
(f) This Guaranty and the obligations of Guarantors hereunder shall
be valid and enforceable and shall not be subject to any reduction,
limitation, impairment, discharge or termination for any reason (other than
payment in full of the Guarantied Obligations), including without
limitation the occurrence of any of the following, whether or not any
Guarantor shall have had notice or knowledge of any of them: (i) any
failure or omission to assert or enforce or agreement or election not to
assert or enforce, or the stay or enjoining, by order of court, by
operation of law or otherwise, of the exercise or enforcement of, any claim
or demand or any right, power or remedy (whether arising under the Loan
Documents the Lender Interest Rate Agreements, at law, in equity or
otherwise) with respect to the Guarantied Obligations or any agreement
relating thereto, or with respect to any other guaranty of or security for
the payment of the Guarantied Obligations; (ii) any rescission, waiver,
amendment or modification of, or any consent to departure from, any of the
terms or provisions (including without limitation provisions relating to
events of default) of the Credit Agreement, any of the other Loan
Documents, any of the Lender Interest Rate Agreements or any agreement or
instrument executed pursuant thereto, or of any other guaranty or security
for the Guarantied Obligations, in each case whether or not in accordance
with the terms of the Credit Agreement or such Loan Document, such Lender
Interest Rate Agreement or any agreement relating to such other guaranty or
security; (iii) the Guarantied Obligations, or any agreement relating
thereto, at any time being found to be illegal, invalid or unenforceable in
any respect; (iv) the application of payments received from any source
(other than payments received pursuant to the other Loan Documents or any
of the Lender Interest Rate Agreements or from the proceeds of any security
for the Guarantied Obligations, except to the extent such security also
serves as collateral for indebtedness other than the Guarantied
Obligations) to the payment of indebtedness other than the Guarantied
Obligations, even though any Beneficiary might have elected to apply such
payment to any part or all of the Guarantied Obligations; (v) any
Beneficiary's consent to the change, reorganization or termination of the
corporate structure or existence of Company or any of its Subsidiaries
and to any
VII-7
corresponding restructuring of the Guarantied Obligations; (vi) any
failure to perfect or continue perfection of a security interest in any
collateral which secures any of the Guarantied Obligations; (vii) any
defenses, set-offs or counterclaims which Company may allege or assert
against any Beneficiary in respect of the Guarantied Obligations,
including, but not limited to, failure of consideration, breach of
warranty, payment, statute of frauds, statute of limitations, accord and
satisfaction and usury; and (viii) any other act or thing or omission, or
delay to do any other act or thing, which may or might in any manner or to
any extent vary the risk of any Guarantor as an obliger in respect of the
Guarantied Obligations.
2.5 Waivers by Guarantors.
Each Guarantor hereby waives, for the benefit of Beneficiaries:
(a) any right to require any Beneficiary, as a condition of payment
or performance by such Guarantor, to (i) proceed against Company, any other
guarantor (including any other Guarantor) of the Guarantied Obligations or
any other Person, (ii) proceed against or exhaust any security held from
Company, any such other guarantor or any other Person (iii) proceed against
or have resort to any balance of any deposit account or credit on the books
of any Beneficiary in favor of Company or any other Person, or (iv) pursue
any other remedy in the power of any Beneficiary whatsoever;
(b) any defense arising by reason of the incapacity, lack of
authority or any disability or other defense of Company including without
limitation any defense based on or arising out of the lack of validity or
the unenforceability of the Guarantied Obligations or any agreement or
instrument relating thereto or by reason of the cessation of the liability
of Company from any cause other than payment in full of the Guarantied
Obligations;
(c) any defense based upon any statute or rule of law which provides
that the obligation of a surety must be neither larger in amount nor in
other respects more burdensome than that of the principal;
(d) any defense based upon any Beneficiary's errors or omissions in
the administration of the Guarantied Obligations, except behavior which
amounts to bad faith;
(e)(i) any principles or provisions of law, statutory or otherwise,
which are or might be in conflict with the terms of this Guaranty and any
legal or equitable discharge of such Guarantor's obligations hereunder,
(ii) the benefit of any statute of limitations affecting such Guarantor's
liability hereunder or the enforcement hereof, (iii) any rights to
set-offs, recoupments and counterclaims, and (iv)
VII-8
promptness, diligence and any requirement that any Beneficiary protect,
secure, perfect or insure any security interest or lien or any property
subject thereto;
(f) notices, demands, presentments, protests, notices of protest,
notices of dishonor and notices of any action or inaction, including
acceptance of this Guaranty, notices of default under the Credit Agreement,
the Lender Interest Rate Agreements or any agreement or instrument related
thereto, notices of any renewal, extension or modification of the
Guarantied Obligations or any agreement related thereto, notices of any
extension of credit to Company and notices of any of the matters referred
to in subsection 2.4 and any right to consent to any thereof; and
(g) any defenses or benefits that may be derived from or afforded by
law which limit the liability of or exonerate guarantors or sureties, or
which may conflict with the terms of this Guaranty.
2.6 Guarantors' Rights of Subrogation, Contribution, Etc.
Until the Guarantied Obligations have been paid in full and the
Commitments terminated, each Guarantor hereby waives any claim, right or remedy,
direct or indirect, that such Guarantor now has or may hereafter have against
Company or any of its assets in connection with this Guaranty or the performance
by such Guarantor of its obligations hereunder, in each case whether such claim,
right or remedy arises in equity, under contract, by statute, under common law
or otherwise and including, without limitation, (a) any right of subrogation,
reimbursement or indemnification that such Guarantor now has or may hereafter
have against Company, (b) any right to enforce, or to participate in, any claim,
right or remedy that any Beneficiary now has or may hereafter have against
Company, and (c) any benefit of, and any right to participate in, any collateral
or security now or hereafter held by any Beneficiary. In addition, until the
Guarantied Obligations shall have been paid in full and the Commitments shall
have terminated and all Letters of Credit shall have expired or been cancelled,
each Guarantor shall withhold exercise of any right of contribution such
Guarantor may have against any other guarantor (including any other Guarantor)
of the Guarantied Obligations (including without limitation any such right of
contribution under subsection 2.2(b)). Each Guarantor further agrees that, to
the extent the waiver or agreement to withhold the exercise of its rights of
subrogation, reimbursement, indemnification and contribution as set forth herein
is found by a court of competent jurisdiction to be void or voidable for any
reason, any rights of subrogation, reimbursement or indemnification such
Guarantor may have against Company or against any collateral or security, and
any rights of contribution such Guarantor may have against any such other
guarantor, shall be junior and subordinate to any rights any Beneficiary may
have against Company, to all right, title and interest any Beneficiary may have
in any such collateral or security, and to any right any Beneficiary may have
against such other guarantor. If any amount shall be paid to any Guarantor on
VII-9
account of any such subrogation, reimbursement, indemnification or contribution
rights at any tine when all Guarantied Obligations shall not have been paid in
full, such amount shall be held in trust for Guarantied Party on behalf of
Beneficiaries and shall forthwith be paid over to Guarantied Party for the
benefit of Beneficiaries to be credited and applied against the Guarantied
Obligations, whether matured or unmatured, in accordance with the terms hereof.
2.7 Subordination of Other Obligations.
Any indebtedness of Company or any Guarantor now or hereafter held by
any Guarantor (the "Obligee Guarantor") is hereby subordinated in right of
payment to the Guarantied Obligations, and any such indebtedness collected or
received by the Obligee Guarantor after an Event of Default has occurred and is
continuing shall be held in trust for Guarantied Party on behalf of
Beneficiaries and shall forthwith be paid over to Guarantied Party for the
benefit of Beneficiaries to be credited and applied against the Guarantied
Obligations but without affecting, impairing or limiting in any manner the
liability of the Obligee Guarantor under any other provision of this Guaranty.
2.8 Expenses.
Guarantors jointly and severally agree to pay, or cause to be paid, on
demand, and to save Beneficiaries harmless against liability for, any and all
costs and expenses (including fees and disbursements of counsel and allocated
costs of internal counsel) incurred or expended by any Beneficiary in connection
with the enforcement of or preservation of any rights under this Guaranty.
2.9 Continuing Guaranty.
This Guaranty is a continuing guaranty and shall remain in effect
until all of the Guarantied Obligations shall have been paid in full and the
Commitments shall have terminated and all Letters of Credit shall have expired
or been cancelled. Each Guarantor hereby irrevocably waives any right to revoke
this Guaranty as to future transactions giving rise to any Guarantied
Obligations.
2.10 Authority of Guarantors or Company.
It is not necessary for any Beneficiary to inquire into the capacity
or powers of any Guarantor or Company or the officers, directors or any agents
acting or purporting to act on behalf of any of them.
2.11 Financial Condition of Company.
Any Loans may be granted to Company or continued from time to time,
and any Lender Interest Rate Agreement may be entered into from time to time, in
each case without notice to or authorization from any Guarantor regardless of
the financial or other condition of Company at the time of any such grant or
VII-10
continuation or at the time such Lender Interest Rate Agreement is entered into,
as the case may be. No Beneficiary shall have any obligation to disclose or
discuss with any Guarantor its assessment, or any Guarantor's assessment, of the
financial condition of Company. Each Guarantor has adequate means to obtain
information from Company on a continuing basis concerning the financial
condition of Company and its ability to perform its obligations under the Loan
Documents and the Lender Interest Rate Agreements, and each Guarantor assumes
the responsibility for being and keeping informed of the financial condition of
Company and of all circumstances bearing upon the risk of nonpayment of the
Guarantied Obligations. Each Guarantor hereby waives and relinquishes any duty
on the part of any Beneficiary to disclose any matter, fact or thing relating to
the business, operations or conditions of Company now known or hereafter known
by any Beneficiary.
2.12 Rights Cumulative.
The rights,powers and remedies given to Beneficiaries by this Guaranty
are cumulative and shall be in addition to and independent of all rights, powers
and remedies given to Beneficiaries by virtue of any statute or rule of law or
in any of the other Loan Documents, any of the Lender Interest Rate Agreements
or any agreement between any Guarantor and any Beneficiary or Beneficiaries or
between Company and any Beneficiary or Beneficiaries. Any forbearance or
failure to exercise, and any delay by any Beneficiary in exercising, any right,
power or remedy hereunder shall not impair any such right, power or remedy or be
construed to be a waiver thereof, nor shall it preclude the further exercise of
any such right, power or remedy.
2.13 Bankruptcy; Post-Petition Interest; Reinstatement of Guaranty.
(a) So long as any Guarantied Obligations remain outstanding, no
Guarantor shall, without the prior written consent of Guarantied Party acting
pursuant to the instructions of Requisite Obligees (as defined in subsection
3.14), commence or join with any other Person in commencing any bankruptcy,
reorganization or insolvency proceedings of or against Company. The obligations
of Guarantors under this Guaranty shall not be reduced, limited, impaired,
discharged, deferred, suspended or terminated by any proceeding, voluntary or
involuntary, involving the bankruptcy, insolvency, receivership, reorganization,
liquidation or arrangement of Company or by any defense which Company may have
by reason of the order, decree or decision of any court or administrative body
resulting from any such proceeding.
(b) Each Guarantor acknowledges and agrees that any interest on any
portion of the Guarantied Obligations which accrues after the commencement of
any proceeding referred to in clause (a) above (or, if interest on any portion
of the Guarantied Obligations ceases to accrue by operation of law by reason of
the commencement of said proceeding, such interest as
VII-11
would have accrued on such portion of the Guarantied Obligations if said
proceedings had not been commenced) shall be included in the Guarantied
Obligations because it is the intention of Guarantors and Beneficiaries that
the Guarantied Obligations which are guarantied by Guarantors pursuant to
this Guaranty should be determined without regard to any rule of law or order
which may relieve Company of any portion of such Guarantied Obligations.
Guarantors will permit any trustee in bankruptcy, receiver, debtor in
possession, assignee for the benefit of creditors or similar person to pay
Guarantied Party, or allow the claim of Guarantied Party in respect of, any
such interest accruing after the date on which such proceeding is commenced.
(c) In the event that all or any portion of the Guarantied
Obligations are paid by Company, the obligations of Guarantors hereunder
shall continue and remain in full force and effect or be reinstated, as the
case may be, in the event that all or any part of such payment(s) are
rescinded or recovered directly or indirectly from any Beneficiary as a
preference, fraudulent transfer or otherwise, and any such payments which are
so rescinded or recovered shall constitute Guarantied Obligations for all
purposes under this Guaranty.
2.14 Notice of Events.
As soon as any Guarantor obtains knowledge thereof, such Guarantor
shall give Guarantied Party written notice of any condition or event which has
resulted in a breach of or noncompliance with any other condition or covenant
contained herein.
2.15 Set Off.
In addition to any other rights any Beneficiary may have under law or
in equity, if any amount shall at any time be due and owing by any Guarantor to
any Beneficiary under this Guaranty, such Beneficiary is authorized at any time
or from time to time upon the occurrence and during the continuation of any
Event of Default, without notice (any such notice being hereby expressly
waived), to set off and to appropriate and to apply any and all deposits
(general or special, including, but not limited to, indebtedness evidenced by
certificates of deposit, whether matured or unmatured) and any other
indebtedness of such Beneficiary owing to such Guarantor and any other property
of such Guarantor held by any Beneficiary to or for the credit or the account of
such Guarantor against and on account of the Guarantied Obligations and
liabilities of such Guarantor to any Beneficiary under this Guaranty.
VII-12
2.16 Discharge of Guaranty Upon Sale of Guarantor.
If all of the stock of any Guarantor or any of its successors in
interest under this Guaranty shall be sold or otherwise disposed of (including
by merger or consolidation) in an Asset Sale not prohibited by subsection 7.7 of
the Credit Agreement or otherwise consented to by Requisite Lenders, the
Guaranty of such Guarantor or such successor in interest, as the case may be,
hereunder shall automatically be discharged and released without any further
action by any Beneficiary or any other Person effective as of the time of such
Asset Sale; provided that, as a condition precedent to such discharge and
release, Guarantied Party shall have received evidence satisfactory to it that
arrangements satisfactory to it have been made for delivery to Guarantied Party
of the applicable Net Cash Proceeds.
SECTION 3.
MISCELLANEOUS
3.1 Survival of Warranties.
All agreements, representations and warranties made herein shall
survive the execution and delivery of this Guaranty and the other Loan Documents
and the Lender Interest Rate Agreements and any increase in the Commitments
under the Credit Agreement.
3.2 Notices.
Any notice or other communication herein required or permitted to be
given shall be in writing and may be personally served, telexed or sent by
telefacsimile or United States mail or courier and shall be deemed to have been
given when delivered in person or by courier service, or upon receipt of
telefacsimile or telex (with received answerback) or three Business Days after
depositing it in the United States mail with postage pre-paid and properly
addressed; provided, notices to Guarantied Party shall not be effective until
received. For purposes hereof, the address of each party hereto shall be as set
forth under such party's name on the signature pages hereof or, as to any party,
such other address as shall be designated by such party in a written notice
delivered to the other parties hereto.
3.3 Severability.
In case any provision in or obligation under this Guaranty shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.
VII-13
3.4 Amendments and Waivers.
No amendment, modification, termination or waiver of any provision of
this Guaranty, and no consent to any departure by any Guarantor therefrom, shall
in any event be effective without the written concurrence of Guarantied Party
and, in the case of any such amendment or modification, each Guarantor against
whom enforcement of such amendment or modification is sought. Any such waiver
or consent shall be effective only in the specific instance and for the specific
purpose for which it was given.
3.5 Headings.
Section and subsection headings in this Guaranty are included herein
for convenience of reference only and shall not constitute a part of this
Guaranty for any other purpose or be given any substantive effect.
3.6 Applicable Law; Rules of Construction.
THIS GUARANTY AND THE RIGHTS AND OBLIGATIONS OF GUARANTORS AND
BENEFICIARIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF
THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES. The
rules of construction set forth in subsection 1.3 of the Credit Agreement shall
be applicable to this Guaranty mutatis mutandis.
3.7 Successors and Assigns.
This Guaranty is a continuing guaranty and shall be binding upon each
Guarantor and its respective successors and assigns. This Guaranty shall inure
to the benefit of Beneficiaries and their respective successors and assigns. No
Guarantor shall assign this Guaranty or any of the rights or obligations of such
Guarantor hereunder without the prior written consent of all Lenders. Any
Beneficiary may, without notice or consent, assign its interest in this Guaranty
in whole or in part. The terms and provisions of this Guaranty shall inure to
the benefit of any transferee or assignee of any Loan, and in the event of such
transfer or assignment the rights and privileges herein conferred upon such
Beneficiary shall automatically extend to and be vested in such transferee or
assignee, all subject to the terms and conditions hereof.
3.8 Consent to Jurisdiction and Service of Process.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY GUARANTOR ARISING OUT OF
OR RELATING TO THIS GUARANTY, OR ANY OBLIGATIONS HEREUNDER, MAY BE BROUGHT IN
ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN XXX XXXXX, XXXXXX XXX
XXXX XX XXX XXXX BY EXECUTING AND DELIVERING THIS GUARANTY, EACH GUARANTOR, FOR
ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (I) ACCEPTS GENERALLY
AND UNCONDITIONALLY THE NONEXCLUSIVE
VII-14
JURISDICTION AND VENUE OF SUCH COURTS; (II) WAIVES ANY DEFENSE OF FORUM NON
CONVENIENS; (III) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING
IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT
REQUESTED, TO SUCH GUARANTOR AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH
SUBSECTION 3.2; (IV) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE IS
SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER SUCH GUARANTOR IN ANY SUCH
PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING
SERVICE IN EVERY RESPECT; (V) AGREES THAT BENEFICIARIES RETAIN THE RIGHT TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS
AGAINST SUCH GUARANTOR IN THE COURTS OF ANY OTHER JURISDICTION; AND (VI)
AGREES THAT THE PROVISIONS OF THIS SUBSECTION 3.8 RELATING TO JURISDICTION
AND VENUE SHALL BE BINDING AND ENFORCEABLE TO THE FULLEST EXTENT PERMISSIBLE
UNDER NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1402 OR OTHERWISE.
3.9 Waiver of Trial by Jury.
EACH GUARANTOR AND, BY ITS ACCEPTANCE OF THE BENEFITS HEREOF, EACH
BENEFICIARY HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS GUARANTY. The scope
of this waiver is intended to be all-encompassing of any and all disputes that
may be filed in any court and that relate to the subject matter of this
transaction, including without limitation contract claims, tort claims, breach
of duty claims and all other common law and statutory claims. Each Guarantor
and, by its acceptance of the benefits hereof, each Beneficiary (i) acknowledges
that this waiver is a material inducement for such Guarantor and Beneficiaries
to enter into a business relationship, that such Guarantor and Beneficiaries
have already relied on this waiver in entering into this Guaranty or accepting
the benefits thereof, as the case may be, and that each will continue to rely on
this waiver in their related future dealings and (ii) further warrants and
represents that each has reviewed this waiver with its legal counsel, and that
each knowingly and voluntarily waives its jury trial rights following
consultation with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT
MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SUBSECTION 3.9 AND EXECUTED BY GUARANTIED
PARTY AND EACH GUARANTOR), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS GUARANTY. In the
event of litigation, this Guaranty may be filed as a written consent to a trial
by the court.
VII-15
3.10 No Other Writing.
This writing is intended by Guarantors and Beneficiaries as the final
expression of this Guaranty and is also intended as a complete and exclusive
statement of the terms of their agreement with respect to the matters covered
hereby. No course of dealing, course of performance or trade usage, and no
parol evidence of any nature, shall be used to supplement or modify any terms of
this Guaranty. There are no conditions to the full effectiveness of this
Guaranty.
3.11 Further Assurances.
At any time or from time to time, upon the request of Guarantied
Party, Guarantors shall execute and deliver such further documents and do such
other acts and things as Guarantied Party may reasonably request in order to
effect fully the purposes of this Guaranty.
3.12 Additional Guarantors.
The initial Guarantors hereunder shall be such of the Subsidiaries of
Company as are signatories hereto on the date hereof. From time to time
subsequent to the date hereof, additional Subsidiaries of Company may become
parties hereto, as additional Guarantors (each an "Additional Guarantor") by
executing a counterpart of this Guaranty. Upon delivery of any such counterpart
to Administrative Agent, notice of which is hereby waived by Guarantors, each
such Additional Guarantor shall be a Guarantor and shall be as fully a party
hereto as if such Additional Guarantor were an original signatory hereof. Each
Guarantor expressly agrees that its obligations arising hereunder shall not be
affected or diminished by the addition or release of any other Guarantor
hereunder, nor by any election of Administrative Agent not to cause any
Subsidiary of Company to become an Additional Guarantor hereunder. This
Guaranty shall be fully effective as to any Guarantor that is or becomes a party
hereto regardless of whether any other Person becomes or fails to become or
ceases to be a Guarantor hereunder.
3.13 Counterparts; Effectiveness.
This Guaranty may be executed in any number of counterparts and by
the different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed to be an original for all purposes;
but all such counterparts together shall constitute but one and the same
instrument. This Guaranty shall become effective as to each Guarantor upon
the execution of a counterpart hereof by such Guarantor (whether or not a
counterpart hereof shall have been executed by any other Guarantor) and
receipt by Guarantied Party of written or telephonic notification of such
execution and authorization of delivery thereof.
VII-16
3.14 Guarantied Party as Administrative Agent.
(a) Guarantied Party has been appointed to act as Guarantied Party
hereunder by Lenders and, by their acceptance of the benefits hereof, Interest
Rate Exchangers. Guarantied Party shall be obligated, and shall have the right
hereunder, to make demands, to give notices, to exercise or refrain from
exercising any rights, and to take or refrain from taking any action solely in
accordance with this Guaranty and the Credit Agreement; provided that Guarantied
Party shall exercise, or refrain from exercising, any remedies hereunder in
accordance with the instructions of (i) Requisite Lenders or (ii) after payment
in full of all Obligations under the Credit Agreement and the other Loan
Documents, the holders of a majority of the aggregate notional amount (or, with
respect to any Lender Interest Rate Agreement that has been terminated in
accordance with its terms, the amount then due and payable (exclusive of
expenses and similar payments but including any early termination payments then
due) under such Lender Interest Rate Agreement) under all Lender Interest Rate
Agreements (Requisite Lenders or, if applicable, such holders being referred to
herein as "Requisite Obligees"). In furtherance of the foregoing provisions of
this subsection 3.14, each Interest Rate Exchanger, by its acceptance of the
benefits hereof, agrees that it shall have no right individually to enforce this
Guaranty, it being understood and agreed by such Interest Rate Exchanger that
all rights and remedies hereunder may be exercised solely by Guarantied Party
for the benefit of Beneficiaries in accordance with the terms of this subsection
3.14.
(b) Guarantied Party shall at all times be the same Person that is
Administrative Agent under the Credit Agreement. Written notice of resignation
by Administrative Agent pursuant to subsection 9.5 of the Credit Agreement shall
also constitute notice of resignation as Guarantied Party under this Guaranty;
removal of Administrative Agent pursuant to subsection 9.5 of the Credit
Agreement shall also constitute removal as Guarantied Party under this Guaranty;
and appointment of a successor Administrative Agent pursuant to subsection 9.5
of the Credit Agreement shall also constitute appointment of a successor
Guarantied Party under this Guaranty. Upon the acceptance of any appointment as
Administrative Agent under subsection 9.5 of the Credit Agreement by a successor
Administrative Agent, that successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring or removed Guarantied Party under this Guaranty, and the
retiring or removed Guarantied Party under this Guaranty shall promptly (i)
transfer to such successor Guarantied Party all sums held hereunder, together
with all records and other documents necessary or appropriate in connection with
the performance of the duties of the successor Guarantied Party under this
Guaranty, and (ii) take such other actions as may be necessary or appropriate in
connection with the assignment to such successor Guarantied Party of the rights
created hereunder, whereupon such retiring or removed Guarantied Party shall be
discharged from its duties and obligations under this Guaranty.
VII-17
After any retiring or removed Guarantied Party's resignation or removal
hereunder as Guarantied Party, the provisions of this Guaranty shall inure to
its benefit as to any actions taken or omitted to be taken by it under this
Guaranty while it was Guarantied Party hereunder.
[Remainder of page intentionally left blank]
VII-18
IN WITNESS WHEREOF, each of the undersigned Guarantors has caused this
Guaranty to be duly executed and delivered by its officer thereunto duly
authorized as of the date first written above.
[GUARANTOR]
By:
Name:
Title:
Notice Address for the foregoing
Guarantors:
Attention:
Facsimile:
with a copy to:
XxXxxx De Leeuw & Co.
000 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx
Facsimile: (000) 000-0000
(000) 000-0000
and a copy to:
Dartford Partnership L.L.C.
000 Xxxxxxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
Facsimile: (000) 000-0000
and a copy to:
White & Case
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Facsimile: (000) 000-0000
VII-19
IN WITNESS WHEREOF, the undersigned Additional Guarantor has caused
this Guaranty to be duly executed and delivered by its officer thereunto duly
authorized as of ____________, [199_][200_].
[NAME OF ADDITIONAL GUARANTOR]
By:
Name:
Title:
Notice Address:
VII-20
EXHIBIT VIII
[FORM OF PLEDGE AGREEMENT]
THIRD AMENDED AND RESTATED PLEDGE AGREEMENT
This THIRD AMENDED AND RESTATED PLEDGE AGREEMENT (this "Agreement")
is dated as of July 1, 1998 and entered into by and among AURORA FOODS INC.,
a Delaware corporation ("Company" or "Pledgor"); provided that after the
Effective Date, "Pledgors" shall mean and include Company and any Additional
Pledgors (as hereinafter defined)), and THE CHASE MANHATTAN BANK, as
administrative agent for and representative of (in such capacity herein
called "Secured Party") the financial institutions ("Lenders") party to the
Credit Agreement referred to below and any Interest Rate Exchangers (as
hereinafter defined).
PRELIMINARY STATEMENTS
A. Pledgor is the legal and beneficial owner of (i) the shares of
stock (the "Pledged Shares") described in Part A of Schedule I annexed hereto
and issued by the corporations named therein and (ii) the indebtedness (the
"Pledged Debt") described in Part B of said Schedule I and issued by the
obligors named therein.
B. Pursuant to that certain Third Amended and Restated Credit
Agreement dated as of July 1, 1998 (said Third Amended and Restated Credit
Agreement, as it may hereafter be amended, restated, supplemented or
otherwise modified from time to time, being the "Credit Agreement", the terms
defined therein and not otherwise defined herein being used herein as therein
defined), by and among Company, Lenders, Secured Party, as Administrative
Agent, National Westminster Bank PLC, as Syndication Agent, and UBS AG,
Stamford Branch, as Documentation Agent, Lenders have made certain
commitments, subject to the terms and conditions set forth in the Credit
Agreement, to extend certain credit facilities to Company.
C. Company may from time to time enter, or may from time to time
have entered, into one or more Interest Rate Agreements (collectively, the
"Lender Interest Rate Agreements") with one or more Lenders or their
Affiliates (in such capacity, collectively, "Interest Rate Exchangers") in
accordance with the terms of the Credit Agreement, and it is desired that the
obligations of Company under the Lender Interest Rate Agreements, including
without limitation the obligation of Company to make payments thereunder in
the event of early termination thereof (all such obligations being the
"Interest Rate Obligations"), together with all obligations of Company under
the Credit Agreement and the other Loan Documents, be secured hereunder.
D. Additional Pledgors shall execute and deliver counterparts to
that certain Subsidiary Guaranty (said Subsidiary Guaranty, as it may be
amended, restated, supplemented or
VIII-1
otherwise modified from time to time, being the "Subsidiary Guaranty") in
favor of Secured Party for the benefit of Lenders and any Interest Rate
Exchangers, pursuant to which each Additional Pledgor shall guaranty the
prompt payment and performance when due of all obligations of Company under
the Credit Agreement and an obligations of Company under the Lender Interest
Rate Agreements, including without limitation the obligation of Company to
make payments thereunder in the event of early termination thereof.
E. It is a condition precedent to the initial extensions of
credit by Lenders under the Credit Agreement that each Pledgor shall have
granted the security interests and undertaken the obligations contemplated by
this Agreement.
NOW, THEREFORE, in consideration of the premises and in order to
induce Lenders to make Loans and other extensions of credit under the Credit
Agreement and to induce Interest Rate Exchangers to enter into Lender
Interest Rate Agreements, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, each Pledgor hereby
agrees with Secured Party as follows:
SECTION 1. Pledge of Security.
Each Pledgor hereby pledges and assigns to Secured Party, and
hereby grants to Secured Party a security interest in, all of Pledgor's
right, title and interest in and to the following (the "Pledged Collateral"):
(a) the Pledged Shares owned by such Pledgor and the certificates
representing such Pledged Shares and any interest of such Pledgor in the
entries on the books of any financial intermediary pertaining to such
Pledged Shares, and all dividends, cash, warrants, rights, instruments and
other property or proceeds from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of such
Pledged Shares; provided, however, that to the extent the issuer of any of
the Pledged Shares is a controlled foreign corporation (used hereinafter as
such term is defined in Section 957(a) or a successor provision of the
Internal Revenue Code of 1986, as amended from time to time), such Pledgor
shall only be required to pledge Pledged Shares of, certificates
representing Pledged Shares of, and such interests pertaining to Pledged
Shares of such issuer possessing up to but not exceeding 65% of the voting
power of all classes of capital stock entitled to vote of such issuer, and
all dividends, cash, warrants, rights, instruments and other property or
proceeds from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of such Pledged Shares;
(b) the Pledged Debt owned by such Pledgor and the instruments
evidencing such Pledged Debt, and all interest, cash, instruments and other
property or proceeds from time
VIII-2
to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of such Pledged Debt;
(c) all additional shares of, and all securities convertible into and
warrants, options and other rights to purchase or otherwise acquire, stock
of any issuer of any Pledged Shares from time to time acquired by such
Pledgor in any manner (which shares shall be deemed to be part of the
Pledged Shares), the certificates or other instruments representing such
additional shares, securities, warrants, options or other rights and any
interest of such Pledgor in the entries on the books of any financial
intermediary pertaining to such additional shares (all such shares,
securities, warrants, options, rights, certificates, instruments and
interests collectively being "Additional Pledged Shares"), and all
dividends, cash, warrants, rights, instruments and other property or
proceeds from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of such Additional Pledged Shares;
provided, however, that to the extent that the issuer of any Additional
Pledged Shares is a controlled foreign corporation, such Pledgor shall only
be required to pledge Additional Pledged Shares of such issuer possessing
up to but not exceeding 65% of the voting power of all classes of capital
stock entitled to vote of such issuer, and all dividends, cash, warrants,
rights, instruments and other property or proceeds from time to time
received, receivable or otherwise distributed in respect of or in exchange
for any or all of such Additional Pledged Shares;
(d) all additional indebtedness from time to time owed to such
Pledgor by any obligor on any Pledged Debt and the instruments evidencing
such indebtedness, and all interest, cash, instruments and other property
or proceeds from time to time received, receivable or otherwise distributed
in respect of or in exchange for any or all of such indebtedness;
(e) all shares of, and all securities convertible into and warrants,
option and other rights to purchase or otherwise acquire, stock of any
Person that, after the date of this Agreement, becomes, as a result of any
occurrence, a direct Subsidiary of such Pledgor (which shares shall be
deemed to be part of the Pledged Shares), the certificates or other
instruments representing such shares, securities, warrants, options or
other rights and any interest of such Pledgor in the entries on the books
of any financial intermediary pertaining to such shares (all such shares,
securities, warrants, options, rights, certificates, instruments and
interests collectively being "New Pledged Shares"), and all dividends,
cash, warrants, rights, instruments and other property or proceeds from
time to time received, receivable or otherwise distributed in respect of or
in exchange for any or all of such shares, securities, warrants, options or
other rights; provided, however, that
VIII-3
in the event that any such direct Subsidiary is a controlled foreign
corporation, such Pledgor shall only be required to pledge New Pledged
Shares of such Subsidiary possessing up to but not exceeding 65% of the
voting power of all classes of capital stock entitled to vote of such
Subsidiary, and all dividends, cash, warrants, rights, instruments and
other property or proceeds from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of such
New Pledged Shares;
(f) all indebtedness from time to time owed to such Pledgor by any
Person that, after the date of this Agreement, becomes, as a result of such
any occurrence, a direct or indirect Subsidiary of such Pledgor, and all
interest, cash, instruments and other property or proceeds from time to
time received, receivable or otherwise distributed in respect of or in
exchange for any or all of such indebtedness; and
(g) to the extent not covered by clauses (a) through (f) above, all
proceeds of any or all of the foregoing Pledged Collateral. For purposes
of this Agreement, the term "proceeds" includes whatever is receivable or
received when Pledged Collateral or proceeds are sold, exchanged, collected
or otherwise disposed of, whether such disposition is voluntary or
involuntary, and includes, without limitation, proceeds of any indemnity or
guaranty payable to such Pledgor or Secured Party from time to time with
respect to any of the Pledged Collateral.
SECTION 2. Security for Obligations.
This Agreement secures, and the Pledged Collateral pledged and
assigned by each Pledgor is collateral security for, the prompt payment or
performance in full when due, whether at stated maturity, by required
prepayment, declaration, acceleration, demand or otherwise (including without
limitation the payment of amounts that would become due but for the operation of
the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C.
Section 362(a)), of all Secured Obligations with respect to such Pledgor.
"Secured Obligations" means
(a) with respect to Company, all obligations and liabilities of every
nature of Company now or hereafter existing under or arising out of or in
connection with the Credit Agreement and the other Loan Documents and any
Lender Interest Rate Agreements, and
(b) with respect to each Additional Pledgor, all obligations and
liabilities of every nature of Additional Pledgors now or hereafter
existing under or arising out of or in connection with the Subsidiary
Guaranty,
in each case together with all extensions or renewals thereof, whether for
principal, interest (including without limitation interest that, but for the
filing of a petition in bankruptcy
VIII-4
with respect to Company, would accrue on such obligations, whether or not a
claim is allowed against Company for such interest in the related bankruptcy
proceeding), reimbursement of amounts drawn under Letters of Credit, payments
for early termination of Lender Interest Rate Agreements, fees, expenses,
indemnities or otherwise, whether voluntary or involuntary, direct or
indirect, absolute or contingent, liquidated or unliquidated, whether or not
jointly owed with others, and whether or not from time to time decreased or
extinguished and later increased, created or incurred, and all or any portion
of such obligations or liabilities that are paid, to the extent all or any
part of such payment is avoided or recovered directly or indirectly from
Secured Party or any Lender or Interest Rate Exchanger as a preference,
fraudulent transfer or otherwise, and all obligations of every nature of
Pledgors now or hereafter existing under this Agreement.
SECTION 3. Delivery of Pledged Collateral.
All certificates or instruments representing or evidencing the
Pledged Collateral shall be delivered to and held by or on behalf of Secured
Party pursuant hereto and shall be in suitable form for transfer by delivery
or, as applicable, shall be accompanied by the appropriate Pledgor's
endorsement, where necessary, or duly executed instruments of transfer or
assignment in blank, all in form and substance satisfactory to Secured Party.
Upon the occurrence and during the continuation of an Event of Default (as
defined in the Credit Agreement) or the occurrence of an Early Termination
Date (as defined in a Master Agreement or an Interest Rate Swap Agreement or
Interest Rate and Currency Exchange Agreement in the form prepared by the
International Swap and Derivatives Association Inc. or a similar event under
any similar swap agreement) under any Lender Interest Rate Agreement (either
such occurrence being an "Event of Default" for purposes of this Agreement),
Secured Party shall have the right, without notice to any Pledgor, to
transfer to or to register in the name of Secured Party or any of its
nominees any or all of the Pledged Collateral, subject only to the revocable
rights specified in Section 7(a). In addition, Secured Party shall have the
right at any time to exchange certificates or instruments representing or
evidencing Pledged Collateral for certificates or instruments of smaller or
larger denominations.
SECTION 4. Representations and Warranties.
Each Pledgor represents and warrants as of the date it becomes a
party hereto as follows:
(a) Due Authorization, etc. of Pledged Collateral. All of the
Pledged Shares owned by such Pledgor have been duly authorized and validly
issued and are fully paid and non-assessable. All of the Pledged Debt
owned by such Pledgor has been duly authorized, authenticated or issued,
and delivered and is the legal, valid and binding obligation of the issuers
thereof and is not in default.
VIII-5
(b) Description of Pledged Collateral. The Pledged Shares owned by
such Pledgor constitute the percentage of the issued and outstanding shares
of stock of each issuer thereof set forth on Schedule I annexed hereto, and
there are no outstanding warrants, options or other rights to purchase, or
other agreements outstanding with respect to, or property that is now or
hereafter convertible into, or that requires the issuance or sale of, any
Pledged Shares. The Pledged Debt owned by such Pledgor constitutes all of
the issued and outstanding intercompany indebtedness evidenced by a
promissory note of the respective issuers thereof owing to such Pledgor.
(c) Ownership of Pledged Collateral. Such Pledgor is the legal,
record and beneficial owner of the Pledged Collateral owned by such Pledgor
free and clear of any Lien except for the security interest created by this
Agreement.
(d) Perfection. The pledge of the Pledged Collateral pursuant to
this Agreement creates a valid and perfected first priority security
interest in the Pledged Collateral, securing the payment of the Secured
Obligations.
VIII-6
SECTION 5. Transfers and Other Liens; Additional Pledged
Collateral; etc.
Each Pledgor shall:
(a) not, except as expressly permitted by the Credit Agreement, (i)
sell, assign (by operation of law or otherwise) or otherwise dispose of, or
grant any option with respect to, any of the Pledged Collateral, (ii)
create or suffer to exist any Lien upon or with respect to any of the
Pledged Collateral, except for the security interest under this Agreement,
or (iii) permit any issuer of Pledged Shares to merge or consolidate unless
all the outstanding capital stock of the surviving or resulting corporation
is, upon such merger or consolidation, pledged hereunder and no cash,
securities or other property is distributed in respect of the outstanding
shares of any other constituent corporation; provided that if the surviving
or resulting corporation upon any such merger or consolidation involving an
issuer of Pledged Shares which is a controlled foreign corporation is a
controlled foreign corporation, then such Pledgor shall only be required to
pledge outstanding capital stock of such surviving or resulting corporation
possessing up to but not exceeding 65% of the voting power of all classes
of capital stock of such issuer entitled to vote; provided further that in
the event any Pledgor makes an Asset Sale permitted by the Credit Agreement
and the assets subject to such Asset Sale are Pledged Shares, Secured Party
shall release the Pledged Shares that are the subject of such Asset Sale to
such Pledgor free and clear of the lien and security interest under this
Agreement concurrently with the consummation of such Asset Sale; and
provided further, that as a condition precedent to such release, Secured
Party shall have received evidence satisfactory to it that arrangements
satisfactory to it have been made for delivery to Secured Party of the Net
Cash Proceeds of such Asset Sale in the event and to the extent that all or
any portion of such Net Cash Proceeds are required to be applied to prepay
the Loans under the Credit Agreement.
(b)(i) cause each issuer of Pledged Shares not to issue any stock or
other securities in addition to or in substitution for the Pledged Shares
issued by such issuer, except to a Pledgor, (ii) pledge hereunder,
immediately upon its acquisition (directly or indirectly) thereof, any and
all additional shares of stock or other securities of each issuer of
Pledged Shares, and (iii) pledge hereunder, immediately upon its
acquisition (directly or indirectly) thereof, any and all shares of stock
of any Person that, after the date of this Agreement, becomes, as a result
of any occurrence, a direct Subsidiary of any Pledgor; provided, that
notwithstanding anything contained in this clause (b) to the contrary, such
Pledgor shall only be required to pledge the outstanding capital stock of a
controlled foreign corporation possessing up to but not exceeding 65% of
the voting power of all classes of capital stock of such controlled foreign
corporation entitled to
VIII-7
vote;
(c)(i) pledge hereunder, immediately upon their issuance, any and all
instruments or other evidences of additional indebtedness from time to time
owed to such Pledgor by any obligor on the Pledged Debt, and (ii) pledge
hereunder, immediately upon their issuance, any and all instruments or
other evidences of indebtedness from time to time owed to such Pledgor by
any Person that after the date of this Agreement becomes, as a result of
any occurrence, a direct or indirect Subsidiary of any Pledgor;
(d) promptly deliver to Secured Party all written notices received by
it with respect to the Pledged Collateral; and
(e) pay promptly when due all taxes, assessments and governmental
charges or levies imposed upon, and all claims against, the Pledged
Collateral, except to the extent the validity thereof is being contested in
good faith; provided that such Pledgor shall in any event pay such taxes,
assessments, charges, levies or claims not later than five days prior to
the date of any proposed sale under any judgement, writ or warrant of
attachment entered or filed against Pledgor or any of the Pledged
Collateral as a result of the failure to make such payment.
SECTION 6. Further Assurances; Pledge Amendments.
(a) Each Pledgor agrees that from time to time, at the expense of
Pledgors, such Pledgor will promptly execute and deliver all further
instruments and documents, and take all further action, that may be necessary
or desirable, or that Secured Party may request, in order to perfect and
protect any security interest granted or purported to be granted hereby or to
enable Secured Party to exercise and enforce its rights and remedies
hereunder with respect to any Pledged Collateral. Without limiting the
generality of the foregoing, such Pledgor will: (i) execute and file such
financing or continuation statements, or amendments thereto, and such other
instruments or notices, as may be necessary or desirable, or as Secured Party
may request, in order to perfect and preserve the security interests granted
or purported to be granted hereby and (ii) at Secured Party's request, appear
in and defend any action or proceeding that may affect such Pledgor's title
to or Secured Party's security interest in all or any part of the Pledged
Collateral.
(b) Each Pledgor further agrees that it will, upon obtaining any
additional shares of stock or other securities required to be pledged
hereunder as provided in Section 5(b) or (c), promptly (and in any event
within five Business Days) deliver to Secured Party a Pledge Amendment, duly
executed by such Pledgor, in substantially the form of Schedule II annexed
hereto (a "Pledge Amendment"), in respect of the additional Pledged Shares or
Pledged Debt to be pledged pursuant to this Agreement. Each Pledgor hereby
authorizes Secured Party to attach each Pledge Amendment to this Agreement
and agrees that all Pledged Shares or Pledged Debt listed on any such Pledge
Amendment delivered to Secured Party shall for all purposes hereunder be
considered Pledged Collateral; provided that the failure of a Pledgor to
execute a Pledge Amendment with respect to any additional Pledged Shares or
Pledged Debt pledged pursuant to this
VIII-8
Agreement shall not impair the security interest of Secured Party therein or
otherwise adversely affect the rights and remedies of Secured Party hereunder
with respect thereto.
SECTION 7. Voting Rights; Dividends; Etc.
(a) Pledgors' Rights. So long as no Event of Default shall have
occurred and be continuing:
(i) Pledgors shall be entitled to exercise any and all voting
and other consensual rights pertaining to the Pledged Collateral or any
part thereof for any purpose not inconsistent with the terms of this
Agreement or the Credit Agreement;
(ii) Pledgors shall be entitled to receive and retain, and to
utilize free and clear of the lien of this Agreement, any and all dividends
and interest paid in respect of the Pledged Collateral; provided, however,
that any and all
(1) dividends and interest paid or payable other than in cash in
respect of, and instruments and other property received, receivable or
otherwise distributed in respect of, or in exchange for, any Pledged
Collateral,
(2) dividends and other distributions paid or payable in cash in
respect of any Pledged Collateral in connection with a partial or
total liquidation or dissolution or in connection with a reduction of
capital, capital surplus or paid-in-surplus, and
(3) cash paid, payable or otherwise distributed in respect of
principal or in redemption of or in exchange for any Pledged
Collateral,
shall be, and shall forthwith be delivered to Secured Party to hold as,
Pledged Collateral and shall, if received by a Pledgor, be received in trust
for the benefit of Secured Party, be segregated from the other property or
funds of such Pledgor and be forthwith delivered to Secured Party as Pledged
Collateral in the same form as so received (with all necessary endorsements);
and
(iii) Secured Party shall promptly execute and deliver (or cause
to be executed and delivered) to Pledgors all such proxies, dividend
payment orders and other instruments as Pledgors may from time to time
reasonably
VIII-9
request for the purpose of enabling Pledgors to exercise the voting and
other consensual rights which they are entitled to exercise pursuant to
paragraph (i) above and to receive the dividends, principal or interest
payments which they are authorized to receive and retain pursuant to
paragraph (ii) above.
(b) Secured Party's Rights. Upon acceleration of the maturity of
the Loans in accordance with Section 8 of the Credit Agreement and upon the
occurrence and during the continuation of an Event of Default:
(i) upon written notice from Secured Party to a Pledgor, all
rights of such Pledgor to exercise the voting and other consensual rights
which it would otherwise be entitled to exercise pursuant to Section
7(a)(i) shall cease, and all such rights shall thereupon become vested in
Secured Party who shall thereupon have the sole right to exercise such
voting and other consensual rights;
(ii) all rights of Pledgors to receive the dividends and interest
payments which they would otherwise be authorized to receive and retain
pursuant to Section 7(a)(ii) shall cease, and all such rights shall
thereupon become vested in Secured Party who shall thereupon have the sole
right to receive and hold as Pledged Collateral such dividends and interest
payments; and
(iii) all dividends, principal and interest payments which are
received by a Pledgor contrary to the provisions of paragraph (ii) of this
Section 7(b) shall be received in trust for the benefit of Secured Party,
shall be segregated from other funds of such Pledgor and shall forthwith be
paid over to Secured Party as Pledged Collateral in the same form as so
received (with any necessary endorsements).
(c) Irrevocable Proxy. In order to permit Secured Party to
exercise the voting and other consensual rights which it may be entitled to
exercise pursuant to Section 7(b)(i) and to receive all dividends and other
distributions which it may be entitled to receive under Section 7(a)(ii) or
Section 7(b)(ii), (i) each Pledgor shall promptly execute and deliver (or
cause to be executed and delivered) to Secured Party all such proxies,
dividend payment orders and other instruments as Secured Party may from time
to time reasonably request and (ii) without limiting the effect of the
immediately preceding clause (i), each Pledgor hereby grants to Secured Party
an IRREVOCABLE PROXY to vote the Pledged Shares owned by such Pledgor and to
exercise all other rights, powers, privileges and remedies to which a holder
of the Pledged Shares would be entitled (including without limitation giving
or withholding written consents of shareholders, calling special meetings of
shareholders and voting at such meetings), which proxy shall be effective,
automatically and without the necessity of any action (including any transfer
of any Pledged Shares on the record books of the issuer thereof)
VIII-10
by any other Person (including the issuer of the Pledged Shares or any
officer or agent thereof), upon the occurrence of an Event of Default and
which proxy shall only terminate upon the payment in full of the Secured
Obligations.
SECTION 8. Secured Party Appointed Attorney-in-Fact.
Each Pledgor hereby irrevocably appoints Secured Party as such
Pledgor's attorney-in-fact, with full authority in the place and stead of
such Pledgor and in the name of such Pledgor, Secured Party or otherwise,
from time to time in Secured Party's discretion to take any action and to
execute any instrument that Secured Party may deem necessary or advisable to
accomplish the purposes of this Agreement, including without limitation:
(a) to file one or more financing or continuation statements, or
amendments thereto, relative to all or any part of the Pledged Collateral
without the signature of such Pledgor;
(b) to ask, demand, collect, xxx for, recover, compound, receive and
give acquittance and receipts for moneys due and to become due under or in
respect of any of the Pledged Collateral;
(c) to receive, endorse and collect any instruments made payable to
such Pledgor representing any dividend, principal or interest payment or
other distribution in respect of the Pledged Collateral or any part thereof
and to give full discharge for the same; and
(d) to file any claims or take any action or institute any
proceedings that Secured Party may deem necessary or desirable for the
collection of any of the Pledged Collateral or otherwise to enforce the
rights of Secured Party with respect to any of the Pledged Collateral.
SECTION 9. Secured Party May Perform.
If any Pledgor fails to perform any agreement contained herein,
Secured Party may itself perform, or cause performance of, such agreement,
and the expenses of Secured Party incurred in connection therewith shall be
payable by Pledgors under Section 13(b).
SECTION 10. Standard of Care.
The powers conferred on Secured Party hereunder are solely to
protect its interest in the Pledged Collateral and shall not impose any duty
upon it to exercise any such powers. Except for the exercise of reasonable
care in the custody of any Pledged Collateral in its possession and the
accounting for moneys actually received by it hereunder, Secured Party shall
have no duty as to any Pledged Collateral, it being understood that Secured
Party shall have no responsibility for (a) ascertaining or taking action with
respect to calls, conversions, exchanges, maturities, tenders or other
matters relating to any
VIII-11
Pledged Collateral, whether or not Secured Party has or is deemed to have
knowledge of such matters, (b) taking any necessary steps (other than steps
taken in accordance with the standard of care set forth above to maintain
possession of the Pledged Collateral) to preserve rights against any parties
with respect to any Pledged Collateral, (c) taking any necessary steps to
collect or realize upon the Secured Obligations or any guarantee therefor, or
any part thereof, or any of the Pledged Collateral, or (d) initiating any
action to protect the Pledged Collateral against the possibility of a decline
in market value. Secured Party shall be deemed to have exercised reasonable
care in the custody and preservation of Pledged Collateral in its possession
if such Pledged Collateral is accorded treatment substantially equal to that
which Secured Party accords its own property consisting of negotiable
securities.
SECTION 11. Remedies.
(a) If any Event of Default shall have occurred and be continuing,
Secured Party may exercise in respect of the Pledged Collateral, in addition
to all other rights and remedies provided for herein or otherwise available
to it, all the rights and remedies of a secured party on default under the
Uniform Commercial Code as in effect in any relevant jurisdiction (the
"Code") (whether or not the Code applies to the affected Pledged Collateral),
and Secured Party may also in its sole discretion, without notice except as
specified below, sell the Pledged Collateral or any part thereof in one or
more parcels at public or private sale, at any exchange or broker's board or
at any of Secured Party's offices or elsewhere, for cash, on credit or for
future delivery, at such time or times and at such price or prices and upon
such other terms as Secured Party may deem commercially reasonable,
irrespective of the impact of any such sales on the market price of the
Pledged Collateral. Secured Party or any Lender or Interest Rate Exchanger
may be the purchaser of any or all of the Pledged Collateral at any such sale
and Secured Party, as agent for and representative of Lenders and Interest
Rate Exchangers (but not any Lender or Lenders or Interest Rate Exchanger or
Interest Rate Exchangers in its or their respective individual capacities
unless Requisite Obligees (as defined in Section 15(a)) shall otherwise agree
in writing), shall be entitled, for the purpose of bidding and making
settlement or payment of the purchase price for all or any portion of the
Pledged Collateral sold at any such public sale, to use and apply any of the
Secured Obligations as a credit on account of the purchase price for any
Pledged Collateral payable by Secured Party at such sale. Each purchaser at
any such sale shall hold the property sold absolutely free from any claim or
right on the part of any Pledgor, and each Pledgor hereby waives (to the
extent permitted by applicable law) all rights of redemption, stay and/or
appraisal which it now has or may at any time in the future have under any
rule of law or statute now existing or hereafter enacted. Each Pledgor
agrees that, to the extent notice of sale shall be required by law, at least
ten days' notice to such Pledgor of the time and place of any public sale or
the time after which any private sale is to be made shall
VIII-12
constitute reasonable notification. Secured Party shall not be obligated to
make any sale of Pledged Collateral regardless of notice of sale having been
given. Secured Party may adjourn any public or private sale from time to
time by announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was so
adjourned. Each Pledgor hereby waives any claims against Secured Party
arising by reason of the fact that the price at which any Pledged Collateral
may have been sold at such a private sale was less than the price which might
have been obtained at a public sale, even if Secured Party accepts the first
offer received and does not offer such Pledged Collateral to more than one
offeree. If the proceeds of any sale or other disposition of the Pledged
Collateral are insufficient to pay all the Secured Obligations, Pledgors
shall be jointly and severally liable for the deficiency and the fees of any
attorneys employed by Secured Party to collect such deficiency.
(b) Each Pledgor recognizes that, by reason of certain
prohibitions contained in the Securities Act and applicable state securities
laws, Secured Party may be compelled, with respect to any sale of all or any
part of the Pledged Collateral conducted without prior registration or
qualification of such Pledged Collateral under the Securities Act and/or such
state securities laws, to limit purchasers to those who will agree, among
other things, to acquire the Pledged Collateral for their own account, for
investment and not with a view to the distribution or resale thereof. Each
Pledgor acknowledges that any such private sales may be at prices and on
terms less favorable than those obtainable through a public sale without such
restrictions and, notwithstanding such circumstances, such Pledgor agrees
that any such private sale shall be deemed to have been made in a
commercially reasonable manner and that Secured Party shall have no
obligation to engage in public sales and no obligation to delay the sale of
any Pledged Collateral for the period of time necessary to permit the issuer
thereof to register it for a form of public sale requiring registration under
the Securities Act or under applicable state securities laws, even if such
issuer would, or should, agree to so register it.
(c) If Secured Party determines to exercise its right to sell any
or all of the Pledged Collateral, upon written request, each Pledgor shall
and shall cause each issuer of any Pledged Shares owned by such Pledgor to be
sold hereunder from time to time to furnish to Secured Party all such
information as Secured Party may request in order to determine the number of
shares and other instruments included in the Pledged Collateral which may be
sold by Secured Party in exempt transactions under the Securities Act and the
rules and regulations of the Securities and Exchange Commission thereunder,
as the same are from time to time in effect.
SECTION 12. Application of Proceeds.
All proceeds received by Secured Party in respect of any sale of,
collection from, or other realization upon all or any part of the Pledged
Collateral shall be applied as provided
VIII-13
in subsection 2.4D of the Credit Agreement.
SECTION 13. Indemnity and Expenses.
(a) Pledgors jointly and severally agree to indemnify Secured
Party, each Lender and each Interest Rate Exchanger from and against any and
all claims, losses and liabilities in any way relating to, growing out of or
resulting from this Agreement and the transactions contemplated hereby
(including without limitation enforcement of this Agreement), except to the
extent such claims, losses or liabilities result solely from Secured Party's
or such Lender's or Interest Rate Exchanger's gross negligence or willful
misconduct as finally determined by a court of competent jurisdiction.
(b) Pledgors jointly and severally agree to pay to Secured Party
upon demand the amount of any and all costs and expenses, including the
reasonable fees and expenses of its counsel and of any experts and agents,
that Secured Party may incur in connection with (i) the administration of
this Agreement, (ii) the custody or preservation of, or the sale of,
collection from, or other realization upon, any of the Pledged Collateral,
(iii) the exercise or enforcement of any of the rights of Secured Party
hereunder, or (iv) the failure by any Pledgor to perform or observe any of
the provisions hereof.
(c) The obligations of Pledgors in this Section 13 shall survive
the termination of this Agreement and the discharge of Pledgors' other
obligations under this Agreement, the Lender Interest Rate Agreements, the
Credit Agreement and the other Loan Documents.
SECTION 14. Continuing Security Interest; Transfer of Loans.
This Agreement shall create a continuing security interest in the
Pledged Collateral and shall (a) remain in full force and effect until the
payment in full of all Secured Obligations, the cancellation or termination
of the Commitments and the cancellation or expiration of all outstanding
Letters of Credit, (b) be binding upon Pledgors and their respective
successors and assigns, and (c) inure, together with the rights and remedies
of Secured Party hereunder, to the benefit of Secured Party and its
successors, transferees and assigns. Without limiting the generality of the
foregoing clause (c), but subject to the provisions of subsection 10.1 of the
Credit Agreement, any Lender may assign or otherwise transfer any Loans held
by it to any other Person, and such other Person shall thereupon become
vested with all the benefits in respect thereof granted to Lenders herein or
otherwise. Upon the payment in full of all Secured Obligations, the
cancellation or termination of the Commitments and the cancellation or
expiration of all outstanding Letters of Credit, the security interest
granted hereby shall terminate and all rights to the Pledged Collateral shall
revert to the applicable Pledgors. Upon any such termination Secured Party
will, at Pledgors' expense, execute and deliver to Pledgors such documents as
Pledgors shall reasonably request to evidence such termination and Pledgors
shall be
VIII-14
entitled to the return, upon their request and at their expense, against
receipt and without recourse to Secured Party, of such of the Pledged
Collateral as shall not have been sold or otherwise applied pursuant to the
terms hereof.
SECTION 15. Secured Party as Administrative Agent.
(a) Secured Party has been appointed to act as Secured Party
hereunder by Lenders and, by their acceptance of the benefits hereof,
Interest Rate Exchangers. Secured Party shall be obligated, and shall have
the right hereunder, to make demands, to give notices, to exercise or refrain
from exercising any rights, and to take or refrain from taking any action
(including without limitation the release or substitution of Pledged
Collateral), solely in accordance with this Agreement and the Credit
Agreement; provided that Secured Party shall exercise, or refrain from
exercising, any remedies provided for in Section 11 in accordance with the
instructions of (i) Requisite Lenders or (ii) after payment in full of all
Obligations under the Credit Agreement and the other Loan Documents, the
holders of a majority of the aggregate notional amount (or, with respect to
any Lender Interest Rate Agreement that has been terminated in accordance
with its terms, the amount then due and payable (exclusive of expenses and
similar payments but including any early termination payments then due) under
such Lender Interest Rate Agreement) under all Lender Interest Rate
Agreements (Requisite Lenders or, if applicable, such holders being referred
to herein as "Requisite Obligees"). In furtherance of the foregoing
provisions of this Section 15(a), each Interest Rate Exchanger, by its
acceptance of the benefits hereof, agrees that it shall have no right
individually to realize upon any of the Pledged Collateral hereunder, it
being understood and agreed by such Interest Rate Exchanger that all rights
and remedies hereunder may be exercised solely by Secured Party for the
benefit of Lenders and Interest Rate Exchangers in accordance with the terms
of this Section 15(a).
(b) Secured Party shall at all times be the same Person that is
Administrative Agent under the Credit Agreement. Written notice of
resignation by Administrative Agent pursuant to subsection 9.5 of the Credit
Agreement shall also constitute notice of resignation as Secured Party under
this Agreement; removal of Administrative Agent pursuant to subsection 9.5 of
the Credit Agreement shall also constitute removal as Secured Party under
this Agreement; and appointment of a successor Administrative Agent pursuant
to subsection 9.5 of the Credit Agreement shall also constitute appointment
of a successor Secured Party under this Agreement. Upon the acceptance of
any appointment as Administrative Agent under subsection 9.5 of the Credit
Agreement by a successor Administrative Agent, that successor Administrative
Agent shall thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the retiring or removed Secured Party under
this Agreement, and the retiring or removed Secured Party under this
Agreement shall promptly (i) transfer to such successor Secured Party all
sums, securities and other items of Collateral held hereunder,
VIII-15
together with all records and other documents necessary or appropriate in
connection with the performance of the duties of the successor Secured Party
under this Agreement, and (ii) execute and deliver to such successor Secured
Party such amendments to financing statements, and take such other actions,
as may be necessary or appropriate in connection with the assignment to such
successor Secured Party of the security interests created hereunder,
whereupon such retiring or removed Secured Party shall be discharged from its
duties and obligations under this Agreement. After any retiring or removed
Administrative Agent's resignation or removal hereunder as Secured Party, the
provisions of this Agreement shall inure to its benefit as to any actions
taken or omitted to be taken by it under this Agreement while it was Secured
Party hereunder.
SECTION 16. Amendments; Etc.
No amendment, modification, termination or waiver of any provision of
this Agreement, and no consent to any departure by any Pledgor therefrom,
shall in any event be effective unless the same shall be in writing and
signed by Secured Party and, in the case of any such amendment or
modification, by Pledgors; provided that any Pledge Amendment in the form of
Schedule II annexed hereto or any amendment hereto pursuant to Section 19
shall be effective upon execution by any Pledgor and Pledgors hereby waive
any requirement of notice of or consent to any such Pledge Amendment or
amendment. Any such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which it was given.
SECTION 17. Notices.
Any notice or other communication herein required or permitted to
be given shall be in writing and may be personally served, telexed or sent by
telefacsimile or United States mail or courier service and shall be deemed to
have been given when delivered in person or by courier service, upon receipt
of telefacsimile or telex (with received answerback), or three Business Days
after depositing it in the United States mail with postage prepaid and
properly addressed; provided that notices to Secured Party shall not be
effective until received. For the purposes hereof, the address of each party
hereto shall be as provided in subsection 10.8 of the Credit Agreement or as
set forth under such party's name on the signature pages hereof or such other
address as shall be designated by such party in a written notice delivered to
the other parties hereto.
SECTION 18. Failure or Indulgence Not Waiver; Remedies Cumulative.
No failure or delay on the part of Secured Party in the exercise of
any power, right or privilege hereunder shall impair such power, right or
privilege or be construed to be a waiver of any default or acquiescence
therein, nor shall any single or partial exercise of any such power, right or
privilege preclude any other or further exercise thereof or of any other
power, right or privilege. All rights and remedies existing under this
VIII-16
Agreement are cumulative to, and not exclusive of, any rights or remedies
otherwise available.
SECTION 19. Additional Pledgors.
From time to time subsequent to the date hereof, Subsidiaries of
Company may become parties hereto, as additional Pledgors (each an
"Additional Pledgor"), by executing an acknowledgement to this Agreement
substantially in the form of Schedule III annexed hereto. Upon delivery of
any such counterpart to Administrative Agent and Secured Party, notice of
which is hereby waived by Pledgors, each such Additional Pledgor shall be a
Pledgor and shall be as fully a party hereto as if such Additional Pledgor
were an original signatory hereto. Each Pledgor expressly agrees that its
obligations arising hereunder shall not be affected or diminished by the
addition or release of any other Pledgor hereunder, nor by any election of
Administrative Agent not to cause any Subsidiary of Company to become an
Additional Pledgor hereunder. This Agreement shall be fully effective as to
any Pledgor that is or becomes a party hereto regardless of whether any other
Person becomes or fails to become or ceases to be a Pledgor hereunder.
SECTION 20. Severability.
In case any provision in or obligation under this Agreement shall
be invalid, illegal or unenforceable in any jurisdiction, the validity,
legality and enforceability of the remaining provisions or obligations, or of
such provision or obligation in any other jurisdiction, shall not in any way
be affected or impaired thereby.
SECTION 21. Headings.
Section and subsection headings in this Agreement are included
herein for convenience of reference only and shall not constitute a part of
this Agreement for any other purpose or be given any substantive effect.
SECTION 22. Governing Law; Terms; Rules of Construction.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE
OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES, EXCEPT TO THE
EXTENT THAT THE CODE PROVIDES THAT THE PERFECTION OF THE SECURITY INTEREST
HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR PLEDGED
COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
NEW YORK. Unless otherwise defined herein or in the Credit Agreement, terms
used in Articles 8 and 9 of the Uniform Commercial Code in the State of New
York are used herein as therein defined. The rules of construction set forth
in subsection 1.3 of the Credit Agreement shall be applicable to this
Agreement mutatis mutandis.
VIII-17
SECTION 23. Consent to Jurisdiction and Service of Process.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY PLEDGOR ARISING OUT OF
OR RELATING TO THIS AGREEMENT, OR ANY OBLIGATIONS HEREUNDER, MAY BE BROUGHT
IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN XXX XXXXX, XXXXXX
XXX XXXX XX XXX XXXX. BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH
PLEDGOR, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (I)
ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE
OF SUCH COURTS; (II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (III) AGREES
THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE
MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO SUCH
PLEDGOR AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 17; (IV) AGREES
THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE IS SUFFICIENT TO CONFER
PERSONAL JURISDICTION OVER SUCH PLEDGOR IN ANY SUCH PROCEEDING IN ANY SUCH
COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY
RESPECT; (V) AGREES THAT SECURED PARTY RETAINS THE RIGHT TO SERVE PROCESS IN
ANY OTHER MATTER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST SUCH
PLEDGOR IN THE COURTS OF ANY OTHER JURISDICTION; AND (VI) AGREES THAT THE
PROVISIONS OF THIS SECTION 23 RELATING TO JURISDICTION AND VENUE SHALL BE
BINDING AND ENFORCEABLE TO THE FULLEST EXTENT PERMISSIBLE UNDER NEW YORK
GENERAL OBLIGATIONS LAW SECTION 5-1402 OR OTHERWISE.
SECTION 24. Waiver of Jury Trial.
PLEDGORS AND SECURED PARTY HEREBY AGREE TO WAIVE THEIR RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF THIS AGREEMENT. The scope of this waiver is intended to be
all-encompassing of any and all disputes that may be filed in any court and
that relate to the subject matter of this transaction, including without
limitation contract claims, tort claims, breach of duty claims, and all other
common law and statutory claims. Each Pledgor and Secured Party acknowledge
that this waiver is a material inducement for Pledgors and Secured Party to
enter into a business relationship, that Pledgors and Secured Party have
already relied on this waiver in entering into this Agreement and that each
will continue to rely on this waiver in their related future dealings. Each
Pledgor and Secured Party further warrant and represent that each has
reviewed this waiver with its legal counsel, and that each knowingly and
voluntarily waives its jury trial rights following consultation with legal
counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED
EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER
SPECIFICALLY REFERRING TO THIS SECTION 24 AND EXECUTED BY EACH OF THE PARTIES
HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. In the event of litigation,
this Agreement may be filed as a written consent to a trial by the court.
SECTION 25. Counterparts.
VIII-18
This Agreement may be executed in one or more counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages
may be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document.
[Remainder of page intentionally left blank]
VIII-19
IN WITNESS WHEREOF, Pledgors and Secured Party have caused this
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
AURORA FOODS INC.
By:
---------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK,
as Secured Party
By:
---------------------------------
Name:
Title:
VIII-20
SCHEDULE I
TO PLEDGE AGREEMENT
Attached to and forming a part of the Third Amended and Restated
Pledge Agreement dated as of July 1, 1998, by and among the Pledgors referred to
therein and The Chase Manhattan Bank, as Secured Party.
Part A
Par Number Percentage
Value of of
Stock Shares Outstanding
Stock Class of Certificate Shares
Pledgor Issuer Stock Nos. Pledged
------- ------ -------- ----------- ----- ------ -----------
Part B
Pledgor Debt Issuer Amount of Indebtedness
------- ----------- ----------------------
VIII-21
SCHEDULE II
TO PLEDGE AGREEMENT
[FORM OF PLEDGE AMENDMENT]
This Pledge Amendment, dated ____________, [199_] [200_] is delivered
pursuant to Section 6(b) of the Pledge Agreement referred to below. The
undersigned hereby agrees that this Pledge Amendment may be attached to the
Third Amended and Restated Pledge Agreement dated as of July 1, 1998, by and
among the Pledgors referred to therein and The Chase Manhattan Bank, as Secured
Party (the "Pledge Agreement", capitalized terms defined therein being used
herein as therein defined), and that the [Pledged Shares] [Pledged Debt] listed
on this Pledge Amendment shall be deemed to be part of the [Pledged Shares]
[Pledged Debt] and shall become part of the Pledged Collateral and shall secure
all Secured Obligations.
[NAME OF PLEDGOR]
By:
---------------------------------
Name:
Title:
Stock Issuer Class of Stock Par Value Number Percentage of
Stock Certificate of Outstanding
Nos. Shares Shares Pledged
------------ -------- ----------- --------- ------ --------------
Debt Issuer Amount of Indebtedness
----------- ----------------------
VIII-22
SCHEDULE III
TO PLEDGE AGREEMENT
[FORM OF PLEDGE ACKNOWLEDGEMENT]
This Pledge Acknowledgement, dated ____________, [199_] [200_], is
delivered pursuant to Section 19 of the Pledge Agreement referred to below. The
undersigned hereby agrees that this Pledge Acknowledgement may be attached to
the Third Amended and Restated Pledge Agreement dated July 1, 1998, by and among
the Pledgors referred to therein and The Chase Manhattan Bank, as Secured Party
(the "Pledge Agreement", capitalized terms defined therein being used herein as
therein defined), that the undersigned by executing and delivering this
Acknowledgement hereby becomes a Pledgor under the Pledge Agreement in
accordance with Section 19 thereof and agrees to be bound by all of the terms
thereof, and that the [Pledged Shares] [Pledged Debt] listed on this Pledge
Acknowledgement shall be deemed to be part of the [Pledged Shares] [Pledged
Debt] and shall become part of the Pledged Collateral and shall secure all
Secured Obligations.
[NAME OF ADDITIONAL PLEDGOR]
By:
---------------------------------
Name:
Title:
Notice Address:
------------------------------------
------------------------------------
------------------------------------
------------------------------------
VIII-23
Stock Issuer Class of Stock Par Value Number Percentage of
Stock Certificate of Outstanding
Nos. Shares Shares Pledged
------------ -------- ----------- --------- ------ --------------
Debt Issuer Amount of Indebtedness
----------- ----------------------
VIII-24
EXHIBIT IX
[FORM OF SECURITY AGREEMENT]
THIRD AMENDED AND RESTATED SECURITY AGREEMENT
This THIRD AMENDED AND RESTATED SECURITY AGREEMENT (this "Agreement") is
dated as of July 1, 1998 and entered into by and among AURORA FOODS INC., a
Delaware corporation ("Company" or "Grantor"); provided that after the Effective
Date, "Grantors" shall mean and include Company and any Additional Grantors (as
hereinafter defined)) and THE CHASE MANHATTAN BANK, as administrative agent for
and representative of (in such capacity herein called "Secured Party") the
financial institutions ("Lenders") party to the Credit Agreement referred to
below and any Interest Rate Exchangers (as hereinafter defined).
PRELIMINARY STATEMENTS
A. Pursuant to that certain Third Amended and Restated Credit
Agreement dated as of July 1, 1998 (said Third Amended and Restated Credit
Agreement, as it may hereafter be amended, restated, supplemented or otherwise
modified from time to time, being the "Credit Agreement", the terms defined
therein and not otherwise defined herein being used herein as therein defined)
by and among Company, Lenders, Secured Party, as Administrative Agent, National
Westminster Bank PLC, as Syndication Agent, and UBS AG, Stamford Branch, as
Documentation Agent, Lenders have made certain commitments, subject to the terms
and conditions set forth in the Credit Agreement, to extend certain credit
facilities to Company.
B. Company may from time to time enter, or may from time to time
have entered, into one or more Interest Rate Agreements (collectively, the
"Lender Interest Rate Agreements") with one or more Lenders or their Affiliates
(in such capacity, collectively, "Interest Rate Exchangers") in accordance with
the terms of the Credit Agreement, and it is desired that the obligations of
Company under the Lender Interest Rate Agreements, including without limitation
the obligation of Company to make payments thereunder in the event of early
termination thereof (all such obligations being the "Interest Rate
Obligations"), together with all obligations of Company under the Credit
Agreement and the other Loan Documents, be secured hereunder.
C. Additional Grantors shall execute and deliver counterparts to
that certain Subsidiary Guaranty (said Subsidiary Guaranty, as it may be
amended, restated, supplemented or otherwise modified from time to time, being
the "Subsidiary Guaranty") in favor of Secured Party for the benefit of Lenders
and any Interest Rate Exchangers, pursuant to which each Additional Grantor
shall guaranty the prompt payment and performance when due of all obligations of
Company under the Credit Agreement and the other Loan Documents and all
obligations of Company under the Lender Interest Rate Agreements, including
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without limitation the obligation of Company to make payments thereunder in the
event of early termination thereof.
D. It is a condition precedent to the extensions of credit by
Lenders under the Credit Agreement that Grantors shall have granted the security
interests and undertaken the obligations contemplated by this Agreement.
NOW, THEREFORE, in consideration of the premises and in order to
induce Lenders to make Loans and other extensions of credit under the Credit
Agreement and to induce Interest Rate Exchangers to enter into the Lender
Interest Rate Agreements, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, each Grantor hereby
agrees with Secured Party as follows:
SECTION 1. Grant of Security.
Each Grantor hereby assigns to Secured Party, and hereby grants to
Secured Party a security interest in, all of such Grantor's right, title and
interest in and to the following, in each case whether now or hereafter existing
or in which Grantor now has or hereafter acquires an interest and wherever the
same may be located (the "Collateral"):
(a) all equipment in all of its forms (including, but not limited to,
all machinery, all computers, all data processing, computer or office
equipment, all furniture and all trucks and other vehicles), all parts
thereof and all accessions thereto (any and all such equipment, parts and
accessions being the "Equipment");
(b) all inventory in all of its forms (including, but not limited to,
(i) all goods held by such Grantor for sale or lease or to be furnished
under contracts of service or so leased or furnished, (ii) all raw
materials, work in process, finished goods, samples, and materials used or
consumed in the manufacture, packing, shipping, advertising, selling,
leasing, furnishing or production of such inventory or otherwise used or
consumed in such Grantor's business, (iii) all goods in which such Grantor
has an interest in mass or a joint or other interest or right of any kind,
and (iv) all goods which are returned to or repossessed by such Grantor)
and all accessions thereto and products thereof (all such inventory,
accessions and products being the "Inventory") and all negotiable and
non-negotiable documents of title (including without limitation warehouse
receipts, dock receipts and bills of lading) issued by any Person covering
any Inventory (any such negotiable document of title being a "Negotiable
Document of Title");
(c) all accounts, contract rights, chattel paper, documents,
instruments, general intangibles and other rights and obligations of any
kind owned by or owing to such Grantor and all rights in, to and under all
security
IX-2
agreements, leases and other contracts securing or otherwise
relating to any such accounts, contract rights, chattel paper, documents,
instruments, general intangibles or other obligations (any and all such
accounts, contract rights, chattel paper, documents, instruments, general
intangibles and other obligations being the "Accounts", and any and all
such security agreements, leases and other contracts being the "Related
Contracts");
(d) all agreements to which such Grantor is a party, including
without limitation those listed in Schedule 1(d) annexed hereto, as each
such agreement may be amended, restated, supplemented or otherwise modified
from time to time (said agreements, as so amended, restated, supplemented
or otherwise modified, being referred to herein individually as an
"Assigned Agreement" and collectively as the "Assigned Agreements"),
including, without limitation, (i) all rights of such Grantor to receive
moneys due or to become due under or pursuant to the Assigned Agreements,
(ii) all rights of such Grantor to receive proceeds of any insurance,
indemnity, warranty or guaranty with respect to the Assigned Agreements,
(iii) all claims of such Grantor for damages arising out of any breach of
or default under the Assigned Agreements, and (iv) all rights of such
Grantor to terminate, amend, supplement, modify or exercise rights or
options under the Assigned Agreements, to perform thereunder and to compel
performance and otherwise exercise all remedies thereunder;
(e) all cash, money, currency and deposit accounts, including without
limitation demand, time, savings, passbooks or similar accounts maintained
with Lenders or other banks, savings and loan associations or other
financial institutions;
(f) all trademarks, trademark applications, trade names, trade
secrets, trade dress, service marks, business names, patents, patent
applications, licenses, copyrights and copyright applications owned by such
Grantor, and all goodwill associated with any of the foregoing;
(g) to the extent not included in any other paragraph of this Section
1, all other general intangibles (including without limitation unpatented
formulas, recipes, manufacturing methods and processes, inventions,
discoveries, tax refunds, rights to payment or performance, choses in
action and judgments taken on any rights or claims included in the
Collateral);
(h) all plant fixtures, business fixtures and other fixtures and
storage and office facilities, and all accessions thereto and products
thereof;
(i) all books, records, ledger cards, files, sales records, sales and
promotional data, invoices, product specifications, drawings, advertising
materials, customer
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lists, cost and pricing information, supplier lists,
business plans, catalogs, quality control manuals, blueprints,
correspondence, computer programs, tapes, disks and related data processing
software that at any time evidence or contain information relating to any
of the Collateral or are otherwise necessary or helpful in the collection
thereof or realization thereupon; and
(j) all proceeds, products, rents and profits of or from any and all
of the foregoing Collateral and, to the extent not otherwise included, all
payments under insurance (whether or not Secured Party is the loss payee
thereof), or any indemnity, warranty or guaranty, payable by reason of loss
or damage to or otherwise with respect to any of the foregoing Collateral.
For purposes of this Agreement, the term "proceeds" includes whatever is
receivable or received when Collateral or proceeds are sold, exchanged,
collected or otherwise disposed of, whether such disposition is voluntary
or involuntary.
SECTION 2. Security for Obligations.
This Agreement secures, and the Collateral assigned by each Grantor is
collateral security for, the prompt payment or performance in full when due,
whether at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise (including without limitation the payment of amounts that
would become due but for the operation of the automatic stay under Section
362(a) of the Bankruptcy Code, 11 U.S.C. Section 362(a)), of all Secured
Obligations with respect to such Grantor. "Secured Obligations" means
(a) with respect to Company, all obligations and liabilities of every
nature of Company now or hereafter existing under or arising out of or in
connection with the Credit Agreement and the other Loan Documents and any
Lender Interest Rate Agreement, and
(b) with respect to each Additional Grantor, all obligations and
liabilities of every nature of Additional Grantors now or hereafter
existing under or arising out of or in connection with the Subsidiary
Guaranty,
in each case together with all extensions or renewals thereof, whether for
principal, interest (including without limitation interest that, but for the
filing of a petition in bankruptcy with respect to Company, would accrue on such
obligations, whether or not a claim is allowed against Company for such interest
in the related bankruptcy proceeding), reimbursement of amounts drawn under
Letters of Credit, payments for early termination of Lender Interest Rate
Agreements, fees, expenses, indemnities or otherwise, whether voluntary or
involuntary, direct or indirect, absolute or contingent, liquidated or
unliquidated, whether or not jointly owed with others, and whether or not from
time to time decreased or extinguished and later increased, created or incurred,
and all or any portion of
IX-4
such obligations or liabilities that are paid, to the extent all or any part
of such payment is avoided or recovered directly or indirectly from Secured
Party or any Lender or Interest Rate Exchanger as a preference, fraudulent
transfer or otherwise, and all obligations of every nature of Grantors now or
hereafter existing under this Agreement.
SECTION 3. Grantors Remain Liable.
Anything contained herein to the contrary notwithstanding, (a) each
Grantor shall remain liable under any contracts and agreements included in the
Collateral, to the extent set forth therein, to perform all of its duties and
obligations thereunder to the same extent as if this Agreement had not been
executed, (b) the exercise by Secured Party of any of its rights hereunder shall
not release any Grantor from any of its duties or obligations under the
contracts and agreements included in the Collateral, and (c) Secured Party shall
not have any obligation or liability under any contracts and agreements included
in the Collateral by reason of this Agreement, nor shall Secured Party be
obligated to perform any of the obligations or duties of any Grantor thereunder
or to take any action to collect or enforce any claim for payment assigned
hereunder.
SECTION 4. Representations and Warranties.
Each Grantor represents and warrants as of the date it becomes a party
hereto as follows:
(a) Ownership of Collateral. Except as expressly permitted by the
Credit Agreement and except for the security interest created by this
Agreement, such Grantor owns the Collateral owned by such Grantor free and
clear of any Lien.
(b) Locations of Equipment and Inventory. All of the Equipment and
Inventory is, as of the date such Grantor has become a party hereto,
located at the places specified in Schedule 4(b) annexed hereto.
(c) Negotiable Documents of Title. No Negotiable Documents of Title
are outstanding with respect to any of the Inventory.
(d) Office Locations. The chief place of business, the chief
executive office and the office where such Grantor keeps its records
regarding the Accounts and all originals of all chattel paper that evidence
Accounts are located at the locations set forth on Schedule 4(d) annexed
hereto.
(e) Names. No Grantor has in the past done, and no Grantor now does,
business under any other name (including any trade-name or fictitious
business name) except the names listed in Schedule 4(e) annexed hereto.
(f) Delivery of Certain Collateral. All notes and
IX-5
other instruments (excluding checks) comprising any and all items of
Collateral have been delivered to Secured Party duly endorsed and
accompanied by duly executed instruments of transfer or assignment in
blank.
(g) Perfection. The security interests in the Collateral granted to
Secured Party for the ratable benefit of the Lenders and Interest Rate
Exchangers hereunder constitute valid security interests in the Collateral.
Upon the filing of UCC financing statements naming each Grantor as
"debtor", naming Secured Party as "secured party" and describing the
Collateral in the filing offices set forth on Schedule 4(g) annexed hereto,
the security interests in the Collateral granted to Secured Party for the
ratable benefit of the Lenders and Interest Rate Exchangers will, to the
extent a security interest in the Collateral may be perfected by filing UCC
financing statements, constitute perfected security interests therein prior
to all other Liens.
SECTION 5. Further Assurances.
(a) Each Grantor agrees that from time to time, at the expense of
Grantors, such Grantor will promptly execute and deliver all further instruments
and documents, and take all further action, that may be necessary or desirable,
or that Secured Party may request, in order to perfect and protect any security
interest granted or purported to be granted hereby or to enable Secured Party to
exercise and enforce its rights and remedies hereunder with respect to any
Collateral. Without limiting the generality of the foregoing, each Grantor
will: (i) at the request of Secured Party, xxxx conspicuously each item of
chattel paper included in the Accounts, each Related Contract and, at the
request of Secured Party, each of its records pertaining to the Collateral, with
a legend, in form and substance satisfactory to Secured Party, indicating that
such Collateral is subject to the security interest granted hereby, (ii) at the
request of Secured Party, deliver and pledge to Secured Party hereunder all
promissory notes and other instruments (including checks) and all original
counterparts of chattel paper constituting Collateral, duly endorsed and
accompanied by duly executed instruments of transfer or assignment, all in form
and substance satisfactory to Secured Party, (iii) execute and file such
financing or continuation statements, or amendments thereto, and such other
instruments or notices, as may be necessary or desirable, or as Secured Party
may request, in order to perfect and preserve the security interests granted or
purported to be granted hereby, (iv) promptly after the acquisition by such
Grantor of any item of Equipment which is covered by a certificate of title
under a statute of any jurisdiction under the law of which indication of a
security interest on such certificate is required as a condition of perfection
thereof, execute and file with the registrar of motor vehicles or other
appropriate authority in such jurisdiction an application or other document
requesting the notation or other indication of the security interest created
IX-6
hereunder on such certificate of title, (v) within 30 days after the end of each
calendar year and June 30 of each calendar year, deliver to Secured Party copies
of all such applications or other documents filed during such semiannual period
and copies of all such certificates of title issued during such semiannual
period indicating the security interest created hereunder in the items of
Equipment covered thereby, (vi) at any reasonable time, upon request by Secured
Party, exhibit the Collateral to and allow inspection of the Collateral by
Secured Party, or persons designated by Secured Party, and (vii) at Secured
Party's request, appear in and defend any action or proceeding that may affect
such Grantor's title to or Secured Party's security interest in all or any part
of the Collateral.
(b) Each Grantor hereby authorizes Secured Party to file one or more
financing or continuation statements, and amendments thereto, relative to all or
any part of the Collateral without the signature of any Grantor. Each Grantor
agrees that a carbon, photographic or other reproduction of this Agreement or of
a financing statement signed by such Grantor shall be sufficient as a financing
statement and may be filed as a financing statement in any and all
jurisdictions.
(c) Each Grantor will furnish to Secured Party from time to time
statements and schedules further identifying and describing the Collateral and
such other reports in connection with the Collateral as Secured Party may
reasonably request, all in reasonable detail.
SECTION 6. Certain Covenants of Grantors.
Each Grantor shall:
(a) not use or permit any Collateral to be used unlawfully or in
violation of any provision of this Agreement or any applicable statute,
regulation or ordinance or any policy of insurance covering the Collateral;
(b) notify Secured Party of any change in such Grantor's name,
identity or corporate structure within 15 days of such change;
(c) give Secured Party 30 days' prior written notice of any change in
such Grantor's chief place of business, chief executive office or residence
or the office where such Grantor keeps its records regarding the Accounts
and all originals of all chattel paper that evidence Accounts; and
(d) pay promptly when due all property and other taxes, assessments
and governmental charges or levies imposed upon, and all claims (including
claims for labor, materials and supplies) against, the Collateral, except
to the extent the validity thereof is being contested in good faith;
provided that such Grantor shall in any event pay such taxes, assessments,
charges, levies or claims not later than five days prior to the date of any
proposed sale under any judgement, writ or warrant of attachment entered or
filed
IX-7
against such Grantor or any of the Collateral as a result of the
failure to make such payment.
SECTION 7. Special Covenants With Respect to Equipment and
Inventory.
Each Grantor shall:
(a) keep the Equipment and Inventory owned by such Grantor at the
places therefor specified on Schedule 4(b) annexed hereto or, upon 30 days'
prior written notice to Secured Party, at such other places in
jurisdictions where all action that may be necessary or desirable, or that
Secured Party may request, in order to perfect and protect any security
interest granted or purported to be granted hereby, or to enable Secured
Party to exercise and enforce its rights and remedies hereunder, with
respect to such Equipment and Inventory shall have been taken;
(b) cause the Equipment owned by such Grantor to be maintained and
preserved in the same condition, repair and working order as when new,
ordinary wear and tear excepted, and in accordance with such Grantor's past
practices. Each Grantor shall promptly furnish to Secured Party a
statement respecting any material loss or damage to any of the Equipment
owned by such Grantor;
(c) keep correct and accurate records of Inventory owned by such
Grantor, itemizing and describing the kind, type and quantity of such
Inventory, such Grantor's cost therefor and (where applicable) the current
list prices for such Inventory;
(d) if any Inventory is in possession or control of any of such
Grantor's agents or processors, if the aggregate book value of all such
Inventory exceeds $300,000, and in any event upon the occurrence of an
Event of Default (as defined in the Credit Agreement) or the occurrence of
an Early Termination Date (as defined in a Master Agreement or an Interest
Rate Swap Agreement or Interest Rate and Currency Exchange Agreement in the
form prepared by the International Swap and Derivatives Association Inc. or
a similar event under any similar swap agreement) under any Lender Interest
Rate Agreement (either such occurrence being an "Event of Default" for
purposes of this Agreement), instruct such agent or processor to hold all
such Inventory for the account of Secured Party and subject to the
instructions of Secured Party.
(e) promptly upon the issuance and delivery to such Grantor of any
Negotiable Document of Title, deliver such Negotiable Document of Title to
Secured Party.
SECTION 8. Insurance.
Each Grantor shall, at its own expense, maintain
IX-8
insurance with respect to the Equipment and Inventory in accordance with the
terms of the Credit Agreement.
SECTION 9. Special Covenants with respect to Accounts and Related
Contracts.
(a) Each Grantor shall keep its chief place of business and chief
executive office and the office where it keeps its records concerning the
Accounts and Related Contracts, and all originals of all chattel paper that
evidence Accounts, at the location therefor specified in Section 4 or, upon 30
days' prior written notice to Secured Party, at such other location in a
jurisdiction where all action that may be necessary or desirable, or that
Secured Party may request, in order to perfect and protect any security interest
granted or purported to be granted hereby, or to enable Secured Party to
exercise and enforce its rights and remedies hereunder, with respect to such
Accounts and Related Contracts shall have been taken. Each Grantor will hold
and preserve such records and chattel paper and will permit representatives of
Secured Party at any time during normal business hours to inspect and make
abstracts from such records and chattel paper, and each Grantor agrees to render
to Secured Party, at Grantor's cost and expense, such clerical and other
assistance as may be reasonably requested with regard thereto. Promptly upon
the request of Secured Party, each Grantor shall deliver to Secured Party
complete and correct copies of each Related Contract.
(b) Each Grantor shall, for not less than 3 years from the date on
which such Account arose, maintain (i) complete records of each Account of such
Grantor, including records of all payments received, credits granted and
merchandise returned, and (ii) all documentation relating thereto.
(c) Except as otherwise provided in this subsection (c), each Grantor
shall continue to collect, at its own expense, all amounts due or to become due
to such Grantor under the Accounts and Related Contracts. In connection with
such collections, each Grantor may take (and, at Secured Party's direction,
shall take) such action as such Grantor or Secured Party may deem necessary or
advisable to enforce collection of amounts due or to become due under the
Accounts; provided, however, that Secured Party shall have the right at any
time, upon the occurrence and during the continuation of an Event of Default or
a Potential Event of Default and upon written notice to such Grantor of its
intention to do so, to notify the account debtors or obligors under any Accounts
of the assignment of such Accounts to Secured Party and to direct such account
debtors or obligors to make payment of all amounts due or to become due to such
Grantor thereunder directly to Secured Party, to notify each Person maintaining
a lockbox or similar arrangement to which account debtors or obligors under any
Accounts have been directed to make payment to remit all amounts representing
collections on checks and other payment items from time to time sent to or
deposited in such lockbox or other arrangement directly to Secured Party and,
upon such notification and at the expense of Grantors, to enforce collection of
any such Accounts and to
IX-9
adjust, settle or compromise the amount or payment thereof, in the same
manner and to the same extent as such Grantor might have done. After receipt
by such Grantor of the notice from Secured Party referred to in the proviso
to the preceding sentence, (i) all amounts and proceeds (including checks and
other instruments) received by such Grantor in respect of the Accounts and
the Related Contracts shall be received in trust for the benefit of Secured
Party hereunder, shall be segregated from other funds of such Grantor and
shall be forthwith paid over or delivered to Secured Party in the same form
as so received (with any necessary endorsement) to be held as cash Collateral
and applied as provided by Section 18, and (ii) such Grantor shall not
adjust, settle or compromise the amount or payment of any Account, or release
wholly or partly any account debtor or obligor thereof, or allow any credit
or discount thereon.
SECTION 10. Special Provisions With Respect to the Assigned
Agreements.
(a) Each Grantor shall at its expense:
(i) if consistent with sound business practices, perform and
observe all terms and provisions of the Assigned Agreements to be performed
or observed by it, maintain the Assigned Agreements in full force and
effect, enforce the Assigned Agreements in accordance with their terms, and
take all such action to such end as may be from time to time requested by
Secured Party; and
(ii) upon the reasonable request of Secured Party, furnish to
Secured Party, promptly upon receipt thereof, copies of all notices,
requests and other documents received by such Grantor under or pursuant to
the Assigned Agreements, and from time to time (A) furnish to Secured Party
such information and reports regarding the Assigned Agreements as Secured
Party may reasonably request and (B) upon request of Secured Party make to
the parties to such Assigned Agreements such demands and requests for
information and reports or for action as such Grantor is entitled to make
under the Assigned Agreements.
(b) Upon the occurrence and during the continuance of an Event of
Default, no Grantor shall:
(i) cancel or terminate any of the Assigned Agreements or
consent to or accept any cancellation or termination thereof;
(ii) amend or otherwise modify the Assigned Agreements or give
any consent, waiver or approval thereunder;
(iii) waive any default under or breech of the Assigned
Agreements;
(iv) consent to or permit or accept any prepayment of amounts to
become due under or in connection with the
IX-10
Assigned Agreements, except as expressly provided therein; or
(v) take any other action in connection with the Assigned
Agreements that would materially impair the value of the interest or rights
of such Grantor thereunder or that would materially impair the interest or
rights of Secured Party.
SECTION 11. Deposit Accounts.
Upon the occurrence and during the continuation of an Event of
Default, Secured Party may exercise dominion and control over, and refuse to
permit further withdrawals (whether of money, securities, instruments or other
property) from any deposit accounts maintained with Secured Party constituting
part of the Collateral.
SECTION 12. License of Patents, Trademarks, Copyrights, etc.
Each Grantor hereby assigns, transfers and conveys to Secured Party,
effective upon the occurrence of any Event of Default, the nonexclusive right
and license to use all trademarks, tradenames, copyrights, patents or technical
processes owned or held by such Grantor that are necessary for the use and
enjoyment of the Collateral and any other collateral granted by such Grantor as
security for the Secured Obligations, together with any goodwill associated
therewith, all to the extent necessary to enable Secured Party to use, possess
and realize on the Collateral and to enable any successor or assign to enjoy the
benefits of the Collateral. This right and license shall inure to the benefit
of all successors, assigns and transferees of Secured Party and its successors,
assigns and transferees, whether by voluntary conveyance, operation of law,
assignment, transfer, foreclosure, deed in lieu of foreclosure or otherwise.
Such right and license is granted free of charge, without requirement that any
monetary payment whatsoever be made to such Grantor.
SECTION 13. Transfers and Other Liens.
No Grantor shall:
(a) sell, assign (by operation of law or otherwise) or otherwise
dispose of any of the Collateral, except as permitted by the Credit
Agreement; or
(b) except for the security interest created by this Agreement,
create or suffer to exist any Lien upon or with respect to any of the
Collateral to secure the indebtedness or other obligations of any Person.
SECTION 14. Secured Partner Appointed Attorney-in-Fact.
Each Grantor hereby irrevocably appoints Secured Party as such
Grantor's attorney-in-fact, with full authority in the place and stead of such
Grantor and in the name of such Grantor,
IX-11
Secured Party or otherwise, from time to time in Secured Party's discretion
to take any action and to execute any instrument that Secured Party may deem
necessary or advisable to accomplish the purposes of this Agreement,
including without limitation:
(a) upon the occurrence and during the continuance of an Event of
Default, to obtain and adjust insurance required to be maintained by such
Grantor or paid to Secured Party pursuant to Section 8;
(b) upon the occurrence and during the continuance of an Event of
Default, to ask for, demand, collect, xxx for, recover, compound, receive
and give acquittance and receipts for moneys due and to become due under or
in respect of any of the Collateral;
(c) upon the occurrence and during the continuance of an Event of
Default, to receive, endorse and collect any drafts or other instruments,
documents and chattel paper in connection with clauses (a) and (b) above;
(d) upon the occurrence and during the continuance of an Event of
Default, to file any claims or take any action or institute any proceedings
that Secured Party may deem necessary or desirable for the collection of
any of the Collateral or otherwise to enforce the rights of Secured Party
with respect to any of the Collateral;
(e) to pay or discharge taxes or Liens (other than Liens permitted
under this Agreement or the Credit Agreement) levied or placed upon or
threatened against the Collateral, the legality or validity thereof and the
amounts necessary to discharge the same to be determined by Secured Party
in its sole discretion, any such payments made by Secured Party to become
obligations of such Grantor to Secured Party, due and payable immediately
without demand;
(f) upon the occurrence and during the continuance of an Event of
Default, to sign and endorse any invoices, freight or express bills, bills
of lading, storage or warehouse receipts, drafts against debtors,
assignments, verifications and notices in connection with Accounts and
other documents relating to the Collateral; and
(g) upon the occurrence and during the continuance of an Event of
Default, generally to sell, transfer, pledge, make any agreement with
respect to or otherwise deal with any of the Collateral as fully and
completely as though Secured Party were the absolute owner thereof for all
purposes, and to do, at Secured Party's option and Grantors' expense, at
any time or from time to time, all acts and things that Secured Party deems
necessary to protect, preserve or realize upon the Collateral and Secured
Party's security interest therein in order to effect the intent of this
Agreement, all as fully and effectively as such Grantor might do.
IX-12
SECTION 15. Secured Party May Perform.
If any Grantor fails to perform any agreement contained herein,
Secured Party may itself perform, or cause performance of, such agreement, and
the expenses of Secured Party incurred in connection therewith shall be payable
by such Grantor under Section 19(b).
SECTION 16. Standard of Care.
The powers conferred on Secured Party hereunder are solely to protect
its interest in the Collateral and shall not impose any duty upon it to exercise
any such powers. Except for the exercise of reasonable care in the custody of
any Collateral in its possession and the accounting for moneys actually received
by it hereunder, Secured Party shall have no duty as to any Collateral or as to
the taking of any necessary steps to preserve rights against prior parties or
any other rights pertaining to any Collateral. Secured Party shall be deemed to
have exercised reasonable care in the custody and preservation of Collateral in
its possession if such Collateral is accorded treatment substantially equal to
that which Secured Party accords its own property.
SECTION 17. Remedies.
If any Event of Default shall have occurred and be continuing, Secured
Party may exercise in respect of the Collateral, in addition to all other rights
and remedies provided for herein or otherwise available to it, all the rights
and remedies of a secured party on default under the Uniform Commercial Code as
in effect in any relevant jurisdiction (the "Code") (whether or not the Code
applies to the affected Collateral), and also may (a) require each Grantor to,
and each Grantor hereby agrees that it will at its expense and upon request of
Secured Party forthwith, assemble all or part of the Collateral as directed by
Secured Party and make it available to Secured Party at a place to be designated
by Secured Party that is reasonably convenient to both parties, (b) enter onto
the property where any Collateral is located and take possession thereof with or
without judicial process, (c) prior to the disposition of the Collateral, store,
process, repair or recondition the Collateral or otherwise prepare the
Collateral for disposition in any manner to the extent Secured Party deems
appropriate, (d) take possession of any Grantor's premises or place custodians
in exclusive control thereof, remain on such premises and use the same and any
of such Grantor's equipment for the purpose of completing any work in process,
taking any actions described in the preceding clause (c) and collecting any
Secured Obligation, and (e) without notice except as specified below, sell the
Collateral or any part thereof in one or more parcels at public or private sale,
at any of Secured Party's offices or elsewhere, for cash, on credit or for
future delivery, at such time or times and at such price or prices and upon such
other terms as Secured Party may deem commercially reasonable. Secured Party or
any Lender or Interest Rate Exchanger may be the
IX-13
purchaser of any or all of the Collateral at any such sale and Secured Party,
as agent for and representative of Lenders and Interest Rate Exchangers (but
not any Lender or Lenders or Interest Rate Exchanger or Interest Rate
Exchangers in its or their respective individual capacities unless Requisite
Obligees (as defined in Section 21(a)) shall otherwise agree in writing),
shall be entitled, for the purpose of bidding and making settlement or
payment of the purchase price for all or any portion of the Collateral sold
at any such public sale, to use and apply any of the Secured Obligations as a
credit on account of the purchase price for any Collateral payable by Secured
Party at such sale. Each purchaser at any such sale shall hold the property
sold absolutely free from any claim or right on the part of any Grantor, and
each Grantor hereby waives (to the extent permitted by applicable law) all
rights of redemption, stay and/or appraisal which it now has or may at any
time in the future have under any rule of law or statute now existing or
hereafter enacted. Each Grantor agrees that, to the extent notice of sale
shall be required by law, at least ten days' notice to such Grantor of the
time and place of any public sale or the time after which any private sale is
to be made shall constitute reasonable notification. Secured Party shall not
be obligated to make any sale of Collateral regardless of notice of sale
having been given. Secured Party may adjourn any public or private sale from
time to time by announcement at the time and place fixed therefor, and such
sale may, without further notice, be made at the time and place to which it
was so adjourned. Each Grantor hereby waives any claims against Secured
Party arising by reason of the fact that the price at which any Collateral
may have been sold at such a private sale was less than the price which might
have been obtained at a public sale, even if Secured Party accepts the first
offer received and does not offer such Collateral to more than one offeree.
If the proceeds of any sale or other disposition of the Collateral are
insufficient to pay all the Secured Obligations, Grantors shall be jointly
and severally liable for the deficiency and the fees of any attorneys
employed by Secured Party to collect such deficiency.
SECTION 18. Application of Proceeds.
Except as expressly provided elsewhere in this Agreement, all proceeds
received by Secured Party in respect of any sale of, collection from, or other
realization upon all or any part of the Collateral shall be applied as provided
in subsection 2.4D of the Credit Agreement.
SECTION 19. Indemnity and Expenses.
(a) Grantors jointly and severally agree to indemnify Secured Party,
each Lender and each Interest Rate Exchanger from and against any and all
claims, losses and liabilities in any way relating to, growing out of or
resulting from this Agreement and the transactions contemplated hereby
(including without limitation enforcement of this Agreement), except to the
extent such claims, losses or liabilities result solely from Secured Party's or
such Lender's or Interest Rate Exchanger's gross negligence or willful
misconduct as finally determined by a court
IX-14
of competent jurisdiction.
(b) Grantors jointly and severally agree to pay to Secured Party upon
demand the amount of any and all costs and expenses, including the reasonable
fees and expenses of its counsel and of any experts and agents, that Secured
Party may incur in connection with (i) the administration of this Agreement,
(ii) the custody, preservation, use or operation of, or the sale of, collection
from, or other realization upon, any of the Collateral, (iii) the exercise or
enforcement of any of the rights of Secured Party hereunder, or (iv) the failure
by any Grantor to perform or observe any of the provisions hereof.
(c) The obligations of Grantors in this Section 19 shall survive the
termination of this Agreement and the discharge of Grantors' other obligations
under this Agreement, the Lender Interest Rate Agreements, the Credit Agreement
and the other Loan Documents.
SECTION 20. Continuing Security Interest; Transfer of Loans.
This Agreement shall create a continuing security interest in the
Collateral and shall (a) remain in full force and effect until the payment in
full of the Secured Obligations, the cancellation or termination of the
Commitments and the cancellation or expiration of all outstanding Letters of
Credit, (b) be binding upon Grantors and their respective successors and
assigns, and (c) inure, together with the rights and remedies of Secured Party
hereunder, to the benefit of Secured Party and its successors, transferees and
assigns. Without limiting the generality of the foregoing clause (c), but
subject to the provisions of subsection 10.1 of the Credit Agreement, any Lender
may assign or otherwise transfer any Loans held by it to any other Person, and
such other Person shall thereupon become vested with all the benefits in respect
thereof granted to Lenders herein or otherwise. Upon the payment in full of all
Secured Obligations, the cancellation or termination of the Commitments and the
cancellation or expiration of all outstanding Letters of Credit, the security
interest granted hereby shall terminate and all rights to the Collateral shall
revert to the applicable Grantors. Upon any such termination Secured Party
will, at Grantors' expense, execute and deliver to Grantors such documents as
Grantors shall reasonably request to evidence such termination.
IX-15
SECTION 21. Secured Party as Administrative Agent.
(a) Secured Party has been appointed to act as Secured Party
hereunder by Lenders and, by their acceptance of the benefits hereof, Interest
Rate Exchangers. Secured Party shall be obligated, and shall have the right
hereunder, to make demands, to give notices, to exercise or refrain from
exercising any rights, and to take or refrain from taking any action (including
without limitation the release or substitution of Collateral), solely in
accordance with this Agreement and the Credit Agreement; provided that Secured
Party shall exercise, or refrain from exercising, any remedies provided for in
Section 17 in accordance with the instructions of (i) Requisite Lenders or (ii)
after payment in full of all Obligations under the Credit Agreement and the
other Loan Documents, the holders of a majority of the aggregate notional amount
(or, with respect to any Lender Interest Rate Agreement that has been terminated
in accordance with its terms, the amount then due and payable (exclusive of
expenses and similar payments but including any early termination payments then
due) under such Lender Interest Rate Agreement) under all Lender Interest Rate
Agreements (Requisite Lenders or, if applicable, such holders being referred to
herein as "Requisite Obligees"). In furtherance of the foregoing provisions of
this Section 21(a), each Interest Rate Exchanger, by its acceptance of the
benefits hereof, agrees that it shall have no right individually to realize upon
any of the Collateral hereunder, it being understood and agreed by such Interest
Rate Exchanger that all rights and remedies hereunder may be exercised solely by
Secured Party for the benefit of Lenders and Interest Rate Exchangers in
accordance with the terms of this Section 21(a).
(b) Secured Party shall at all times be the same Person that is
Administrative Agent under the Credit Agreement. Written notice of resignation
by Administrative Agent pursuant to subsection 9.5 of the Credit Agreement shall
also constitute notice of resignation as Secured Party under this Agreement;
removal of Administrative Agent pursuant to subsection 9.5 of the Credit
Agreement shall also constitute removal as Secured Party under this Agreement;
and appointment of a successor Administrative Agent pursuant to subsection 9.5
of the Credit Agreement shall also constitute appointment of a successor Secured
Party under this Agreement. Upon the acceptance of any appointment as
Administrative Agent under subsection 9.5 of the Credit Agreement by a successor
Administrative Agent, that successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring or removed Secured Party under this Agreement, and the retiring
or removed Secured Party under this Agreement shall promptly (i) transfer to
such successor Secured Party all sums, securities and other items of Collateral
held hereunder, together with all records and other documents necessary or
appropriate in connection with the performance of the duties of the successor
Secured Party under this Agreement, and (ii) execute and deliver to such
successor Secured Party such amendments to financing statements, and take such
other actions,
IX-16
as may be necessary or appropriate in connection with the assignment to such
successor Secured Party of the security interests created hereunder,
whereupon such retiring or removed Secured Party shall be discharged from its
duties and obligations under this Agreement. After any retiring or removed
Administrative Agent's resignation or removal hereunder as Secured Party, the
provisions of this Agreement shall inure to its benefit as to any actions
taken or omitted to be taken by it under this Agreement while it was Secured
Party hereunder.
SECTION 22. Additional Grantors.
From time to time subsequent to the date hereof, Subsidiaries of
Company may become parties hereto as additional Grantors (each an "Additional
Grantor") by executing a counterpart of this Agreement and delivering
supplements to Schedule 4(b), Schedule 4(d), Schedule 4(e) and Schedule 4(g) in
substantially the forms annexed hereto, which supplements shall thereby
supplement and amend such Schedules. Upon delivery of any such counterpart to
Administrative Agent and Secured Party, notice of which is hereby waived by
Grantors, each such Additional Grantor shall be a Grantor and shall be as fully
a party hereto as if such Additional Grantor were an original signatory hereto.
Each Grantor expressly agrees that its obligations arising hereunder shall not
be affected or diminished by the addition or release of any other Grantor
hereunder, nor by any election of Administrative Agent not to cause any
Subsidiary of Company to become an Additional Grantor hereunder. This Agreement
shall be fully effective as to any Grantor that is or becomes a party hereto
regardless of whether any other Person becomes or fails to become or ceases to
be a Grantor hereunder.
SECTION 23. Amendments; Etc.
No amendment, modification, termination or waiver of any provision of
this Agreement, and no consent to any departure by any Grantor therefrom, shall
in any event be effective unless the same shall be in writing and signed by
Secured Party and, in the case of any such amendment or modification, by
Grantors; provided that any amendment hereto pursuant to Section 22 shall be
effective upon execution by any Additional Grantor and Grantors hereby waive any
requirement of notice of or consent to any such amendment. Any such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which it was given.
IX-17
SECTION 24. Notices.
Any notice or other communication herein required or permitted to be
given shall be in writing and may be personally served, telexed or sent by
telefacsimile or United States mail or courier service and shall be deemed to
have been given when delivered in person or by courier service, upon receipt of
telefacsimile or telex (with received answerback), or three Business Days after
depositing it in the United States mail with postage prepaid and properly
addressed; provided that notices to Secured Party shall not be effective until
received. For the purposes hereof, the address of each party hereto shall be as
provided in subsection 10.8 of the Credit Agreement or as set forth under such
party's name on the signature pages hereof or such other address as shall be
designated by such party in a written notice delivered to the other parties
hereto.
SECTION 25. Failure or Indulgence Not Waiver; Remedies
Cumulative.
No failure or delay on the part of Secured Party in the exercise of
any power, right or privilege hereunder shall impair such power, right or
privilege or be construed to be a waiver of any default or acquiescence therein,
nor shall any single or partial exercise of any such power, right or privilege
preclude any other or further exercise thereof or of any other power, right or
privilege. All rights and remedies existing under this Agreement are cumulative
to, and not exclusive of, any rights or remedies otherwise available.
SECTION 26. Severability.
In case any provision in or obligation under this Agreement shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.
SECTION 27. Headings.
Section and subsection headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
SECTION 28. Governing Law; Terms; Rules of Construction.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT LIMITATION SECTION
5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD
TO CONFLICTS OF LAWS PRINCIPLES, EXCEPT TO THE EXTENT THAT THE CODE PROVIDES
THAT THE PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER,
IN RESPECT OF ANY PARTICULAR
IX-18
COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
NEW YORK. Unless otherwise defined herein or in the Credit Agreement, terms
used in Articles 8 and 9 of the Uniform Commercial Code in the State of New
York are used herein as therein defined. The rules of construction set forth
in subsection 1.3 of the Credit Agreement shall be applicable to this
Agreement mutatis mutandis.
SECTION 29. Consent to Jurisdiction and Service of Process.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY GRANTOR ARISING OUT OF OR
RELATING TO THIS AGREEMENT, OR ANY OBLIGATIONS HEREUNDER, MAY BE BROUGHT IN ANY
STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN XXX XXXXX, XXXXXX XXX XXXX
XX XXX XXXX. BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH GRANTOR, FOR
ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (I) ACCEPTS GENERALLY
AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (II)
WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (III) AGREES THAT SERVICE OF ALL
PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR
CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO SUCH GRANTOR AT ITS ADDRESS
PROVIDED IN ACCORDANCE WITH SECTION 24; (IV) AGREES THAT SERVICE AS PROVIDED IN
CLAUSE (III) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER SUCH
GRANTOR IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; (V) AGREES THAT SECURED PARTY
RETAINS THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO
BRING PROCEEDINGS AGAINST SUCH GRANTOR IN THE COURTS OF ANY OTHER JURISDICTION;
AND (VI) AGREES THAT THE PROVISIONS OF THIS SECTION 29 RELATING TO JURISDICTION
AND VENUE SHALL BE BINDING AND ENFORCEABLE TO THE FULLEST EXTENT PERMISSIBLE
UNDER NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1402 OR OTHERWISE.
SECTION 30. Waiver of Jury Trial.
GRANTORS AND SECURED PARTY HEREBY AGREE TO WAIVE THEIR RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT
OF THIS AGREEMENT. The scope of this waiver is intended to be all-encompassing
of any and all disputes that may be filed in any court and that relate to the
subject matter of this transaction, including without limitation contract
claims, tort claims, breach of duty claims, and all other common law and
statutory claims. Each Grantor and Secured Party acknowledge that this waiver
is a material inducement for Grantors and Secured Party to enter into a business
relationship, that Grantors and Secured Party have already relied on this waiver
in entering into this Agreement and that each will continue to rely on this
waiver in their related future dealings. Each Grantor and Secured Party further
warrant and represent that each has reviewed this waiver with its legal counsel,
and that each knowingly and voluntarily waives its jury trial rights following
consultation with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT
MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SECTION 30 AND EXECUTED BY EACH OF THE
PARTIES
IX-19
HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. In the event of litigation,
this Agreement may be filed as a written consent to a trial by the court.
SECTION 31. Counterparts.
This Agreement may be executed in one or more counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document.
[Remainder of page intentionally left blank]
IX-20
IN WITNESS WHEREOF, Grantors and Secured Party have caused this
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
AURORA FOODS INC.
By:
-------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK,
as Secured Party
By:
-------------------------------------
Name:
Title:
IX-21
IN WITNESS WHEREOF, the undersigned Additional Grantor has caused this
Agreement to be duly executed and delivered by its officer thereunto duly
authorized as of ____________________, [199_] [200_].
[NAME OF ADDITIONAL GRANTOR]
By:
-------------------------------------
Name:
Title:
Notice Address:
-------------------------------------
-------------------------------------
-------------------------------------
-------------------------------------
IX-22
SCHEDULE 1(d)
TO
SECURITY AGREEMENT
Assigned Agreements
Name of Grantor Assigned Agreements
IX-23
SCHEDULE 4(b)
TO
SECURITY AGREEMENT
Locations of Equipment and Inventory
Name of Grantor Locations of Equipment and Inventory
IX-24
SCHEDULE 4(d)
TO
SECURITY AGREEMENT
Office Locations
Name of Grantor Office Locations
IX-25
SCHEDULE 4(e)
TO
SECURITY AGREEMENT
Other Names
Name of Grantor Other Names
IX-26
SCHEDULE 4(g)
TO
SECURITY AGREEMENT
Filing Offices
IX-27
EXHIBIT X
[FORM OF VAN XX XXXX'X PATENT AND TRADEMARK SECURITY AGREEMENT]
VAN XX XXXX'X PATENT AND TRADEMARK SECURITY AGREEMENT
This VAN XX XXXX'X PATENT AND TRADEMARK SECURITY AGREEMENT (this
"Agreement") is dated as of July 1, 1998 and entered into by and among AURORA
FOODS INC., a Delaware corporation ("Company") (Company being referred to
herein as a "Grantor"; provided that after the Effective Date, "Grantors"
shall mean and include Company and any Additional Grantors (as hereinafter
defined)), and THE CHASE MANHATTAN BANK, as administrative agent for and
representative of (in such capacity herein called "Secured Party") the
financial institutions ("Lenders") party to the Credit Agreement referred to
below and any Interest Rate Exchangers (as hereinafter defined).
PRELIMINARY STATEMENTS
A. Pursuant to that certain Third Amended and Restated Credit
Agreement dated as of July 1, 1998 (said Third Amended and Restated Credit
Agreement, as it may hereafter be amended, restated, supplemented or
otherwise modified from time to time, being the "Credit Agreement", the terms
defined therein and not otherwise defined herein being used herein as therein
defined) by and among Company, Lenders, Secured Party, as Administrative
Agent, National Westminster Bank PLC, as Syndication Agent, and UBS AG,
Stamford Branch, as Documentation Agent, Lenders have made certain
commitments, subject to the terms and conditions set forth in the Credit
Agreement, to extend certain credit facilities to Company.
B. Company may from time to time enter, or may from time to time
have entered, into one or more Interest Rate Agreement (collectively, the
"Lender Interest Rate Agreements") with one or more Lenders or their
Affiliates (in such capacity, collectively, "Interest Rate Exchangers") in
accordance with the terms of the Credit Agreement, and it is desired that the
obligations of Company under the Lender Interest Rate Agreements, including
without limitation the obligation of Company to make payments thereunder in
the event of early termination thereof (all such obligations being the
"Interest Rate Obligations"), together with all obligations of Company under
the Credit Agreement and the other Loan Documents, be secured hereunder.
C. Additional Grantors shall execute and deliver counterparts to
that certain Subsidiary Guaranty (said Subsidiary Guaranty, as it may be
amended, restated, supplemented or otherwise modified from time to time,
being the "Subsidiary Guaranty") in favor of Secured Party for the benefit of
Lenders and any Interest Rate Exchangers, pursuant to which each Additional
Grantor shall guaranty the prompt payment and performance when due of all
obligations of Company under the Credit Agreement and the other Loan
Documents and all obligations
X-1
of Company under the Lender Interest Rate Agreements, including without
limitation the obligation of Company to make payments thereunder in the event
of early termination thereof.
D. Grantors own and use in their business, and will in the future
adopt and so use, various intangible assets, including trademarks, service
marks, designs, logos, indicia, trade names, corporate names, company names,
business names, fictitious business names, trade styles and/or other source
and/or business identifiers and applications pertaining thereto
(collectively, the "Trademarks").
E. Secured Party desires Grantors to assign and grant to it a
lien on and security interest in all of Grantors' existing and future
Trademarks, all registrations that have been or may hereafter be issued or
applied for thereon in the United States and any state thereof and in foreign
countries (the "Registrations"), all common law and other rights in and to
the Trademarks in the United States and any state thereof and in foreign
countries (the "Trademark Rights"), all goodwill of Grantors' business
symbolized by the Trademarks and associated therewith, including without
limitation the documents and things described in Section 1(b) (the
"Associated Goodwill"), and all proceeds of the Trademarks, the
Registrations, the Trademark Rights and the Associated Goodwill, and Grantors
agree to assign and grant to Secured Party a secured and protected interest
in the Trademarks, the Registrations, the Trademark Rights, the Associated
Goodwill and all the proceeds thereof as provided herein.
F. Pursuant to the Security Agreement, each Grantor has assigned
and granted to Secured Party a lien on and security interest in, among other
assets, all Grantors' equipment, inventory, accounts and general intangibles
relating to the products and services sold or delivered under or in
connection with the Trademarks such that, upon the occurrence and during the
continuation of an Event of Default (as defined in the Credit Agreement) or
the occurrence of an Early Termination Date (as defined in a Master Agreement
or an Interest Rate Swap Agreement or Interest Rate and Currency Exchange
Agreement in the form prepared by the International Swap and Derivatives
Association Inc. or a similar event under any similar swap agreement) under
any Lender Interest Rate Agreement (either such occurrence being an "Event of
Default" for purposes of this Agreement), Secured Party would be able to
exercise its remedies consistent with the Security Agreement, this Agreement
and applicable law to foreclose upon Grantors' business and use the
Trademarks, the Registrations and the Trademark Rights in conjunction with
the continued operation of such business, maintaining substantially the same
product and service specifications and quality as maintained by Grantors, and
benefit from the Associated Goodwill.
G. It is a condition precedent to the extensions of credit by
Lenders under the Credit Agreement that Grantors shall have assigned and
granted the security interests and undertaken the obligations contemplated by
this Agreement.
X-2
NOW, THEREFORE, in consideration of the premises and in order to
induce Lenders to make Loans and other extensions of credit under the Credit
Agreement and to induce Interest Rate Exchangers to enter into the Lender
Interest Rate Agreements, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, each Grantor hereby
agrees with Secured Party as follows:
SECTION 1. Assignment and Grant of Security.
Each Grantor hereby grants to Secured Party a security interest in
all of such Grantor's right, title and interest in and to the following, in
each case whether now or hereafter existing or in which Grantor now has or
hereafter acquires an interest and wherever the same may be located (the
"Collateral"):
(a) each of the Trademarks and rights and interests in Trademarks
which are presently, or in the future may be, owned or held (whether
pursuant to a license or otherwise) by such Grantor, in whole or in part
(including without limitation the Trademarks specifically identified in
Schedule I annexed hereto, as the same may be amended pursuant hereto from
time to time), and including all Trademark Rights with respect thereto and
all federal, state and foreign Registrations therefor heretofore or
hereafter granted or applied for, the right (but not the obligation) to
register claims under any state or federal trademark law or regulation or
any trademark law or regulation of any foreign country and to apply for,
renew and extend the Trademarks, Registrations and Trademark Rights, the
right (but not the obligation) to xxx or bring opposition or cancellation
proceedings in the name of such Grantor or in the name of Secured Party or
otherwise for past, present and future infringements of the Trademarks,
Registrations or Trademark Rights and all rights (but not obligations)
corresponding thereto in the United States and any foreign country, and the
Associated Goodwill; it being understood that the rights and interests
included herein shall include, without limitation, all rights and interests
pursuant to licensing or other contracts in favor of such Grantor
pertaining to the Trademarks, Registrations or Trademark Rights presently
or in the future owned or used by third parties but, in the case of third
parties which are not Affiliates of such Grantor, only to the extent
permitted by such licensing or other contracts or otherwise permitted by
applicable law and, if not so permitted under any such contracts and
applicable law, only with the consent of such third parties;
(b) the following documents and things in such Grantor's possession,
or subject to such Grantor's right to possession, related to (Y) the
production, sale and delivery by such Grantor, or by any Affiliate,
licensee or subcontractor of such Grantor, of products or services sold or
delivered by or under the authority of such Grantor in
X-3
connection with the Trademarks, Registrations or Trademark Rights (which
products and services shall, for purposes of this Agreement, be deemed
to include, without limitation, products and services sold or delivered
pursuant to merchandising operations utilizing any Trademarks,
Registrations or Trademark Rights); or (Z) any retail or other
merchandising operations conducted under the name of or in connection
with the Trademarks, Registrations or Trademark Rights by such Grantor
or any Affiliate, licensee or subcontractor of such Grantor:
(i) all lists and ancillary documents that identify and
describe any of such Grantor's customers, or those of their
Affiliates, licensees or subcontractors, for products sold and
services delivered under or in connection with the Trademarks or
Trademark Rights, including without limitation any lists and
ancillary documents that contain a customer's name and address, the
name and address of any of its warehouses, branches or other places
of business, the identity of the Person or Persons having the
principal responsibility on a customer's behalf for ordering
products or services of the kind supplied by such Grantor, or the
credit, payment, discount, delivery or other sale terms applicable
to such customer, together with information setting forth the total
purchases, by brand, product, service, style, size or other
criteria, and the patterns of such purchases;
(ii) all product and service specification documents and
production and quality control manuals used in the manufacture or
delivery of products and services sold or delivered under or in
connection with the Trademarks or Trademark Rights;
(iii) all documents which reveal the name and address of any
source of supply, and any terms of purchase and delivery, for any and
all materials, components and services used in the production of
products and services sold or delivered under or in connection with
the Trademarks or Trademark Rights; and
(iv) all documents constituting or concerning the then current
or proposed advertising and promotion by such Grantor or its
Affiliates, licensees or subcontractors of products and services sold
or delivered under or in connection with the Trademarks or Trademark
Rights including, without limitation, all documents which reveal the
media used or to be used and the cost for all such advertising
conducted within the described period or planned for such products and
services; and
(c) all patents and patent applications and rights and interests
in patents and patent applications that are presently, or in the future
may be, owned, held (whether pursuant to a license or otherwise) or used
by such Grantor
X-4
in whole or in part (including, without limitation, the patents and
patent applications listed in Schedule II annexed hereto, as the same
may be amended pursuant hereto from time to time), all rights (but not
obligations) corresponding thereto (including without limitation the
right (but not the obligation) to xxx for past, present and future
infringements in the name of such Grantor or in the name of Secured
Party), and all re-issues, divisions, continuations, renewals,
extensions and continuations-in-part thereof (all of the foregoing being
collectively referred to as the "Patents"); it being understood that the
rights and interests assigned hereby shall include, without limitation,
all rights and interests pursuant to licensing or other contracts in
favor of such Grantor pertaining to any Patent presently or in the
future owned, held or used by third parties but, in the case of third
parties which are not Affiliates of such Grantor, only to the extent
permitted by such licensing or other contracts or otherwise permitted by
applicable law and, if not so permitted under any such contracts and
applicable law, only with the consent of such third parties;
(d) all books, records, ledger cards, files, correspondence,
computer programs, tapes, disks and related data processing software
that at any time evidence or contain information relating to any of the
Collateral or are otherwise necessary or helpful in the collection
thereof or realization thereupon; and
(e) all proceeds, products, rents and profits (including without
limitation license royalties and proceeds of infringement suits) of or
from any and all of the foregoing Collateral and, to the extent not
otherwise included, all payments under insurance (whether or not Secured
Party is the loss payee thereof), or any indemnity, warranty or
guaranty, payable by reason of loss or damage to or otherwise with
respect to any of the foregoing Collateral. For purposes of this
Agreement, the term "proceeds" includes whatever is receivable or
received when Collateral or proceeds are sold, exchanged, collected or
otherwise disposed of, whether such disposition is voluntary or
involuntary.
SECTION 2. Security for Obligations.
This Agreement secures, and the Collateral assigned by each Grantor
is collateral security for, the prompt payment or performance in full when
due, whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise (including without limitation the payment
of amounts that would become due but for the operation of the automatic stay
under Section 362(a) of the Bankruptcy Code, 11 U.S.C. Section 362(a)), of
all Secured Obligations with respect to such Grantor. "Secured Obligations"
means
(a) with respect to Company, all obligations and
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liabilities of every nature of Company now or hereafter existing under
or arising out of or in connection with the Credit Agreement and the
other Loan Documents and any Lender Interest Rate Agreement, and
(b) with respect to each Additional Grantor, all obligations and
liabilities of every nature of Grantors now or hereafter existing under or
arising out of or in connection with the Subsidiary Guaranty,
in each case together with all extensions or renewals thereof, whether for
principal, interest (including without limitation interest that, but for the
filing of a petition in bankruptcy with respect to Company, would accrue on
such obligations, whether or not a claim is allowed against Company for such
interest in the related bankruptcy proceeding), reimbursement of amounts
drawn under Letters of Credit, payments for early termination of Lender
Interest, Rate Agreements, fees, expenses, indemnities or otherwise, whether
voluntary or involuntary, direct or indirect, absolute or contingent,
liquidated or unliquidated, whether or not jointly owed with others, and
whether or not from time to time decreased or extinguished and later
increased, created or incurred, and all or any portion of such obligations or
liabilities that are paid, to the extent all or any part of such payment is
avoided or recovered directly or indirectly from Secured Party or any Lender
or Interest Rate Exchanger as a preference, fraudulent transfer or otherwise,
and all obligations of every nature of Grantors now or hereafter existing
under this Agreement.
SECTION 3. Grantors Remain Liable.
Anything contained herein to the contrary notwithstanding, (a) each
Grantor shall remain liable under any contracts and agreements included in
the Collateral, to the extent set forth therein, to perform all of its duties
and obligations thereunder to the same extent as if this Agreement had not
been executed, (b) the exercise by Secured Party of any of its rights
hereunder shall not release any Grantor from any of its duties or obligations
under the contracts and agreements included in the Collateral, and (c)
Secured Party shall not have any obligation or liability under any contracts
and agreements included in the Collateral by reason of this Agreement, nor
shall Secured Party be obligated to perform any of the obligations or duties
of any Grantor thereunder or to take any action to collect or enforce any
claim for payment assigned hereunder.
SECTION 4. Representations and Warranties.
Each Grantor represents and warrants as of the date it becomes a party
hereto as follows:
(a) Ownership of Collateral. Except as expressly permitted by the
Credit Agreement and for the security interest assigned and created by this
Agreement, such Grantor is the legal and beneficial owner of the entire
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right, title and interest in and to (i) each Material Trademark Property
(as defined in subsection 4(b) of this Agreement), free and clear of any
Lien other than Liens of mechanics, materialmen, attorneys and other
similar liens imposed by laws in the ordinary course of business in
connection with the establishment, creation or application for Registration
of any Trademarks, Registrations or Trademark Rights for sums not yet
delinquent or being contested in good faith (such Liens being referred to
herein as "Permitted Trademark Liens"), and (ii) each Material Patent (as
defined in subsection 4(b) of this Agreement), free and clear of any Lien
other than Liens of mechanics, materialmen, attorneys and other similar
liens imposed by law in the ordinary course of business in connection with
the establishment, creation or application for any Patent for sums not yet
delinquent or being contested in good faith (such Liens being referred to
herein as "Permitted Patent Liens"). Except such as may have been filed in
favor of Secured Party relating to this Agreement, no effective financing
statement or other instrument similar in effect covering all or any part of
the Collateral is on file in any filing or recording office, including the
United States Patent and Trademark Office.
(b) Description of Collateral. A true and complete list of all
Trademarks, Registrations and Trademark Rights owned or held (whether
pursuant to a license or otherwise) by such Grantor, in whole or in part,
as of the date such Grantor has entered into this Agreement is set forth in
Schedule I annexed hereto. Each Trademark, Registration or Trademark Right
designated on Schedule I annexed hereto as a Material Trademark Property,
and each other Trademark, Registration or Trademark Right hereafter arising
or otherwise owned or held by any Grantor that is material to any of such
Grantor's business or operations is referred to herein as a "Material
Trademark Property". A true and complete list of all Patents owned or held
(whether pursuant to a license or otherwise) by such Grantor, in whole or
in part, as of the date such Grantor has entered into this Agreement is set
forth in Schedule II annexed hereto. Each Patent designated on Schedule II
annexed hereto as a Material Patent and each other Patent hereafter arising
or otherwise owned or held by such Grantor that is material to any of such
Grantor's business or operations is referred to herein as a "Material
Patent".
(c) Validity and Enforceability of Collateral. To the knowledge of
Grantors, each Material Trademark Property and each Material Patent is
valid, subsisting and enforceable. As of the date each Grantor has entered
into this Agreement, such Grantor is not aware of any pending or threatened
claim by any third party that any Material Trademark Property or any
Material Patent is invalid or unenforceable or that the use of any Material
Trademark Property or any Material Patent violates the rights of any third
person or of any basis for any such claim, and there is no such pending or
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threatened claim whether arising prior to or after the Effective Date, that
could reasonably be expected to have a Material Adverse Effect.
(d) Office Locations. The chief place of business, the chief
executive office and the office where such Grantor keeps its records
regarding the Collateral is at the locations set forth on Schedule III
annexed hereto.
(e) Names. No Grantor has in the past done, and no Grantor now does,
business under any other name (including any trade name or fictitious
business name) except under the names listed on Schedule IV annexed hereto.
(f) Perfection. The security interests in the Collateral granted to
Secured Party for the ratable benefit of the Lenders and Interest Rate
Exchangers hereunder constitute valid security interests in the Collateral.
Upon the filing of UCC financing statements naming each Grantor as
"debtor", naming Secured Party as "secured party" and describing the
Collateral in the filing offices set forth on Schedule V annexed hereto and
the recording of this Agreement with the United States Patent and Trademark
Office, the security interests in the Collateral granted to Secured Party
for the ratable benefit of the Lenders and Interest Rate Exchangers will,
to the extent a security interest in the Collateral may be perfected by
filing UCC financing statements and recording this Agreement, constitute
valid and perfected security interests therein prior to all other Liens
(subject only to Permitted Patent Liens and Permitted Trademark Liens).
SECTION 5. Further Assurances; New Trademarks,
Registrations and Trademark Rights;
New Patents and Patent Applications;
Certain Inspection Rights.
(a) Each Grantor agrees that from time to time, at the expense of
Grantors, such Grantor will promptly execute and deliver all further instruments
and documents, and take all further action, that may be necessary or desirable,
or that Secured Party may request, in order to perfect and protect any security
interest assigned or purported to be assigned or granted hereby or to enable
Secured Party to exercise and enforce its rights and remedies hereunder with
respect to any Collateral. Without limiting the generality of the foregoing,
each Grantor will: (i) at the request of Secured Party, take reasonable steps
to indicate that such Collateral is subject to the security interest granted
hereby, (ii) execute and file such financing or continuation statements, or
amendments thereto, and such other instruments or notices, as may be necessary
or desirable, or as Secured Party may request, in order to perfect and preserve
the security interests granted or purported to be granted hereby, (iii) use its
best efforts to obtain any necessary consents of third parties to the assignment
and perfection of a security interest to Secured Party with respect to any
Collateral, and
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(iv) at Secured Party's request, appear in and defend any action or
proceeding that may materially affect such Grantor's title to or Secured
Party's security interest in all or any part of the Collateral.
(b) Each Grantor hereby authorizes Secured Party to file one or
more financing or continuation statements, and amendments thereto, relative
to all or any part of the Collateral without the signature of any Grantor.
Each Grantor agrees that a carbon, photographic or other reproduction of this
Agreement or of a financing statement signed by such Grantor shall be
sufficient as a financing statement and may be filed as a financing statement
in any and all jurisdictions.
(c) Each Grantor hereby authorizes Secured Party to modify this
Agreement without obtaining such Grantor's approval of or signature to such
modification by (i) amending Schedule I annexed hereto to include reference
to any right, title or interest in any existing Trademark, Registration or
Trademark Right or any Trademark, Registration or Trademark Right acquired or
developed by any Grantor after its execution hereof or to delete any
reference to any right, title or interest in any Trademark, Registration or
Trademark Right in which no Grantor has or claims any right, title or
interest, or (ii) amending Schedule II annexed hereto to include reference to
any right, title or interest in any existing Patent or any Patent acquired or
developed by any Grantor after its execution hereof or to delete any
reference to any right, title or interest in any Patent in which no Grantor
has or claims any right, title or interest.
(d) Each Grantor will furnish to Secured Party from time to time
statements and schedules further identifying and describing the Collateral
and such other reports in connection with the Collateral as Secured Party may
reasonably request, all in reasonable detail.
(e) If any Grantor shall obtain rights to any new Trademarks,
Registrations or Trademark Rights, or to any patentable inventions, or become
entitled to the benefit of any patent application or patent or any reissue,
division, continuation, renewal, extension, or continuation-in-part of any
Patent or any improvement in any Patent, the provisions of this Agreement
shall automatically apply thereto. Each Grantor shall promptly notify
Secured Party in writing of any of the foregoing rights or benefits,
including, without limitation, rights to any new Trademarks or Trademark
Rights, acquired by such Grantor after the date hereof and of any
Registrations issued or applications for Registration made after the date
hereof, which notice shall state whether such Trademark, Registration or
Trademark Right constitutes a Material Trademark Property or whether such
Patent constitutes a Material Patent. Within a reasonable time after the
filing of an application for Registration for any Trademark, or an
application for any Patent the applicable Grantor shall execute, deliver and
record in all places where this Agreement is recorded an appropriate Patent
and Trademark Security Agreement, substantially in the form hereof,
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with appropriate insertions, or an amendment to this Agreement, in form and
substance satisfactory to Secured Party, pursuant to which such Grantor shall
assign and grant a security interest to the extent of its interest in such
Registration or Patent as provided herein to Secured Party unless so doing
would, in the reasonable judgment of such Grantor, after due inquiry, result
in the grant of a Patent or Registration in the name of Secured Party, in
which event such Grantor shall give written notice to Secured Party as soon
as reasonably practicable and the filing shall instead be undertaken as soon
as practicable but in no case later than immediately following the grant of
such Patent or Registration.
(f) Each Grantor hereby grants to Secured Party and its employees,
representatives and agents the right to visit such Grantor's and any of its
Affiliate's or subcontractor's plants, facilities and other places of
business that are utilized in connection with the manufacture, production,
inspection, storage or sale of products and services sold or delivered under
any of the Patents, Trademarks, Registrations or Trademark Rights (or which
were so utilized during the prior six month period), and to inspect the
quality control and all other records relating thereto upon reasonable notice
to such Grantor and as often as may be reasonably requested.
SECTION 6. Certain Covenants of Grantors.
Each Grantor shall:
(a) not use or permit any Collateral to be used unlawfully or in
violation of any provision of this Agreement or any applicable statute,
regulation or ordinance or any policy of insurance covering the Collateral;
(b) notify Secured Party of any change in such Grantor's name,
identity or corporate structure within 15 days of such change;
(c) give Secured Party 30 days' prior written notice of any change in
such Grantor's chief place of business or chief executive office or the
office where such Grantor keeps its records regarding the Collateral;
(d) pay promptly when due all property and other taxes, assessments
and governmental charges or levies imposed upon, and all claims (including
claims for labor, materials and supplies) against, the Collateral, except
to the extent the validity thereof is being contested in good faith;
provided that such Grantor shall in any event pay such taxes, assessments,
charges, levies or claims not later than five days prior to the date of any
proposed sale under any judgment, writ or warrant of attachment entered or
filed against such Grantor or any of the Collateral as a result of the
failure to make such payment;
(e) not sell, assign (by operation of law or otherwise) or otherwise
dispose of any of the Collateral,
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except as permitted by the Credit Agreement;
(f) except for Permitted Patent Liens and Permitted Trademark Liens
and the security interest assigned and created by this Agreement, not
create or suffer to exist any Lien upon or with respect to any of the
Collateral to secure the indebtedness or other obligations of any Person;
(g) diligently keep reasonable records respecting the Collateral
assigned by it hereunder and at all times keep at least one complete set of
its records concerning substantially all of the Patents, Trademarks,
Registrations and Trademark Rights at its chief executive office or
principal place of business;
(h) not permit the inclusion in any contract to which it becomes a
party of any provision that could or might in any way conflict with this
Agreement or impair or prevent the assignment and creation of a security
interest in any Grantor's rights and interests in any property included
within the definitions of any Patents, Trademarks, Registrations, Trademark
Rights and Associated Goodwill acquired;
(i) use proper statutory notice in connection with its use of each
Material Patent and Material Trademark Property to the extent reasonably
necessary for the protection of such Material Patent or Material Trademark
Property;
(j) use consistent standards of quality (which may be consistent with
such Grantor's past practices) in the manufacture, sale and delivery of
products and services sold or delivered under or in connection with the
Trademarks, Registrations and Trademark Rights, including, to the extent
applicable, in the operation and maintenance of its retail stores and other
merchandising operations; and
(k) upon any officer of such Grantor obtaining knowledge thereof,
promptly notify Secured Party in writing of any event that may materially
and adversely affect the value of the Collateral or any portion thereof,
the ability of any Grantor or Secured Party to dispose of the Collateral or
any portion thereof, or the rights and remedies of Secured Party in
relation thereto, including without limitation the levy of any legal
process against the Collateral or any portion thereof
SECTION 7. Amounts Payable in Respect of the Collateral.
Except as otherwise provided in this Section 7, each Grantor shall
continue to collect, at its own expense, all amounts due or to become due to
Grantors in respect of the Collateral or any portion thereof. In connection
with such collections, each Grantor may take (and, at Secured Party's
direction, shall take) such action as such Grantor or Secured Party may deem
necessary or advisable to enforce collection of such amounts; provided,
however, that Secured Party shall have
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the right at any time, upon the occurrence and during the continuation of an
Event of Default or a Potential Event of Default and upon written notice to
such Grantor of its intention to do so, to notify the obligors with respect
to any such amounts of the existence of the security interest assigned and
created hereby, and to direct such obligors to make payment of all such
amounts directly to Secured Party, and, upon such notification and at the
expense of Grantors, to enforce collection of any such amounts and to adjust,
settle or compromise the amount or payment thereof, in the same manner and to
the same extent as such Grantor might have done. After receipt by such
Grantor of the notice from Secured Party referred to in the proviso to the
preceding sentence, (i) all amounts and proceeds (including checks and other
instruments) received by such Grantor in respect of amounts due to such
Grantor in respect of the Collateral or any portion thereof shall be received
in trust for the benefit of Secured Party hereunder, shall be segregated from
other funds of such Grantor and shall be forthwith paid over or delivered to
Secured Party in the same form as so received (with any necessary
endorsement) to be held as cash Collateral and applied as provided by Section
14, and (ii) such Grantor shall not adjust, settle or compromise the amount
or payment of any such amount or release wholly or partly any obliger with
respect thereto or allow any credit or discount thereon.
SECTION 8. Patent or Trademark Applications and Litigation.
(a) Each Grantor shall have the duty diligently to prosecute any
trademark application relating to any Material Trademark Property that is
pending as of the date such Grantor has entered into this Agreement, to make
federal application on any existing or future registerable but unregistered
Material Trademark Property (whenever it is commercially reasonable in the
reasonable judgement of such Grantor to do so), and to file and prosecute
opposition and cancellation proceedings, renew Registrations and do any and
all acts which are necessary or desirable to preserve and maintain all rights
in all Material Trademark Properties. Any expenses incurred in connection
therewith shall be borne solely by Grantors. No Grantor shall abandon any
Material Trademark Property unless it is commercially reasonable in the
judgment of such Grantor to do so.
(b) Each Grantor shall have the duty diligently to prosecute any
patent application relating to any Material Patent that is pending as of the
date such Grantor has entered into this Agreement and to do any and all acts
which are necessary or desirable to preserve and maintain all rights in all
Material Patents. Any expenses incurred in connection therewith shall be
borne solely by Grantors. Each Grantor shall not, as to any patentable
invention or Patent that constitutes or could constitute a Material Patent,
abandon any pending patent application or any Patent without the prior
written consent of Secured Party.
(c) Except as provided in Section 8(e), each Grantor shall have the
right to commence and prosecute in its own name, as real party in interest, for
its own benefit and at its own
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expense, such suits, proceedings or other actions for infringement, unfair
competition, dilution or other damage as are in its reasonable business
judgment necessary to protect the Collateral. Secured Party shall provide,
at Grantor's expense, all reasonable and necessary cooperation in connection
with any such suit, proceeding or action including, without limitation,
joining as a necessary party.
(d) Each Grantor shall promptly, following its becoming aware
thereof, notify Secured Party of the institution of, or of any adverse
determination in, any proceeding (whether in the United States Patent and
Trademark Office or any federal, state, local or foreign court) described in
subsection 8(a), 8(b) or 8(c) or regarding such Grantor's claim of ownership
in or right to use any of the Trademarks, Registrations or Trademark Rights,
its right to register the same, or its right to keep and maintain such
Registration. Such Grantor shall provide to Secured Party any information
with respect thereto requested by Secured Party.
(e) Anything contained herein to the contrary notwithstanding,
upon the occurrence and during the continuation of an Event of Default,
Secured Party shall have the right (but not the obligation) to bring suit, in
the name of any Grantor, Secured Party or otherwise, to enforce any Patent,
Trademark, Registration, Trademark Right and any license thereunder and to
enforce its rights hereunder in Associated Goodwill, in which event each
Grantor shall, at the request of Secured Party, do any and all lawful acts
and execute any and all documents required by Secured Party in aid of such
enforcement and each Grantor shall promptly, upon demand, reimburse and
indemnify Secured Party as provided in Section 15 in connection with the
exercise of its rights under this Section 8. To the extent that Secured
Party shall elect not to bring suit to enforce any Patent, Trademark,
Registration, Trademark Right or any license thereunder or to enforce its
rights hereunder in Associated Goodwill as provided in this Section 8(e),
each Grantor agrees to use all reasonable measures, whether by action, suit,
proceeding or otherwise, to prevent the infringement of any of the Patents,
Trademarks, Registrations or Trademark Rights or of Grantors' or Secured
Party's rights in Associated Goodwill by others and for that purpose agrees
to diligently maintain any action, suit or proceeding against any Person so
infringing necessary to prevent such infringement.
SECTION 9. Non-Disturbance Agreements, etc.
If and to the extent that any Grantor is permitted to license the
Collateral, Secured Party shall enter into a non-disturbance agreement or
other similar arrangement, at Grantors' request and expense, with such
Grantor and any licensee of any Collateral permitted hereunder in form and
substance satisfactory to Secured Party pursuant to which (a) Secured Party
shall agree not to disturb or interfere with such licensee's rights under its
license agreement with such Grantor so long as such licensee is not in
default thereunder and (b) such licensee shall acknowledge and agree that the
Collateral licensed to it is
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subject to the security interest assigned and created in favor of Secured
Party and the other terms of this Agreement.
SECTION 10. Secured Party Appointed Attorney-in-Fact.
Each Grantor hereby irrevocably appoints Secured Party as such
Grantor's attorney-in-fact, with full authority in the place and stead of
such Grantor and in the name of such Grantor, Secured Party or otherwise,
from time to time in Secured Party's discretion to take any action and to
execute any instrument that Secured Party may deem necessary or advisable to
accomplish the purposes of this Agreement, including without limitation:
(a) upon the occurrence and during the continuance of an Event of
Default, to endorse such Grantor's name on all applications, documents,
papers and instruments necessary for Secured Party in the use or
maintenance of the Collateral;
(b) upon the occurrence and during the continuance of an Event of
Default, to ask for, demand, collect, xxx for, recover, compound, receive
and give acquittance and receipts for moneys due and to become due under or
in respect of any of the Collateral;
(c) upon the occurrence and during the continuance of an Event of
Default, to receive, endorse and collect any drafts or other instruments,
documents and chattel paper in connection with clause (b) above;
(d) upon the occurrence and during the continuance of an Event of
Default, to file any claims or take any action or institute any proceedings
that Secured Party may deem necessary or desirable for the collection of
any of the Collateral or otherwise to enforce the rights of Secured Party
with respect to any of the Collateral;
(e) to pay or discharge taxes or Liens (other than Liens permitted
under this Agreement or the Credit Agreement) levied or placed upon or
threatened against the Collateral, the legality or validity thereof and the
amounts necessary to discharge the same to be determined by Secured Party
in its sole discretion, any such payments made by Secured Party to become
obligations of such Grantor to Secured Party, due and payable immediately
without demand; and
(f) upon the occurrence and during the continuance of an Event of
Default, (i) to execute and deliver any of the assignments or documents
requested by Secured Party pursuant to Section 13(b), (ii) to grant or
issue an exclusive or non-exclusive license to the Collateral or any
portion thereof to any Person, and (iii) otherwise generally to sell,
transfer, pledge, make any agreement with respect to or otherwise deal with
any of the Collateral as fully and completely as though Secured Party were
the absolute owner thereof for all purposes, and to do, at Secured Party's
X-14
option and Grantors' expense, at any time or from time to time, all acts
and things that Secured Party deems necessary to protect, preserve or
realize upon the Collateral and Secured Party's security interest therein
in order to effect the intent of this Agreement, all as fully and
effectively as such Grantor might do.
SECTION 11. Secured Party May Perform.
If any Grantor fails to perform any agreement contained herein,
Secured Party may itself perform, or cause performance of, such agreement,
and the expenses of Secured Party incurred in connection therewith shall be
payable by such Grantor under Section 15.
SECTION 12. Standard of Care.
The powers conferred on Secured Party hereunder are solely to
protect its interest in the Collateral and shall not impose any duty upon it
to exercise any such powers. Except for the exercise of reasonable care in
the custody of any Collateral in its possession and the accounting for monies
actually received by it hereunder, Secured Party shall have no duty as to any
Collateral or as to the taking of any necessary steps to preserve rights
against prior parties or any other rights pertaining to any Collateral.
Secured Party shall be deemed to have exercised reasonable care in the
custody and preservation of any Collateral in its possession if such
Collateral is accorded treatment substantially equal to that which Secured
Party accords its own property of a similar nature.
SECTION 13. Remedies.
If any Event of Default shall have occurred and be continuing:
(a) Secured Party may exercise in respect of the Collateral, in
addition to all other rights and remedies provided for herein or otherwise
available to it, all the rights and remedies of a secured party on default
under the Uniform Commercial Code as in effect in any relevant jurisdiction
(the "Code") (whether or not the Code applies to the affected Collateral),
and also may (i) require each Grantor to, and each Grantor hereby agrees
that it will at its expense and upon request of Secured Party forthwith,
assemble all or part of the Collateral as directed by Secured Party and
make it available to Secured Party at a place to be designated by Secured
Party that is reasonably convenient to both parties, (ii) enter onto the
property where any Collateral is located and take possession thereof with
or without judicial process, (iii) prior to the disposition of the
Collateral, store the Collateral or otherwise prepare the Collateral for
disposition in any manner to the extent Secured Party deems appropriate,
(iv) take possession of any Grantor's premises or place custodians in
exclusive control thereof, remain on such
X-15
premises and use the same for the purpose of taking any actions
described in the preceding clause (iii) and collecting any Secured
Obligation, (v) exercise any and all rights and remedies of Grantors
under or in connection with the contracts related to the Collateral or
otherwise in respect of the Collateral, including without limitation any
and all rights of Grantors to demand or otherwise require payment of any
amount under, or performance of any provision of, such contracts, and
(vi) without notice except as specified below, sell the Collateral or
any part thereof in one or more parcels at public or private sale, at
any of Secured Party's offices or elsewhere, for cash, on credit or for
future delivery, at such time or times and at such price or prices and
upon such other terms as Secured Party may deem commercially reasonable.
Secured Party or any Lender or Interest Rate Exchanger may be the
purchaser of any or all of the Collateral at any such sale and Secured
Party, as agent for and representative of Lenders and Interest Rate
Exchangers (but not any Lender or Lenders or Interest Rate Exchanger or
Interest Rate Exchangers in its or their respective individual
capacities unless Requisite Obligees (as defined in Section 17(a)) shall
otherwise agree in writing), shall be entitled, for the purpose of
bidding and making settlement or payment of the purchase price for all
or any portion of the Collateral sold at any such public sale, to use
and apply any of the Secured Obligations as a credit on account of the
purchase price for any Collateral payable by Secured Party at such sale.
Each purchaser at any such sale shall hold the property sold absolutely
free from any claim or right on the part of any Grantor, and each
Grantor hereby waives (to the extent permitted by applicable law) all
rights of redemption, stay and/or appraisal which it now has or may at
any time in the future have under any rule of law or statute now
existing or hereafter enacted. Each Grantor agrees that, to the extent
notice of sale shall be required by law, at least ten days' notice to
such Grantor of the time and place of any public sale or the time after
which any private sale is to be made shall constitute reasonable
notification. Secured Party shall not be obligated to make any sale of
Collateral regardless of notice of sale having been given. Secured
Party may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was so
adjourned. Each Grantor hereby waives any claims against Secured Party
arising by reason of the fact that the price at which any Collateral may
have been sold at such a private sale was less than the price which
might have been obtained at a public sale, even if Secured Party accepts
the first offer received and does not offer such Collateral to more than
one offeree. If the proceeds of any sale or other disposition of the
Collateral are insufficient to pay all the Secured Obligations, Grantors
shall be jointly and severally liable for the deficiency and the fees of
any attorneys employed by Secured Party to collect such deficiency.
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(b) Upon written demand from Secured Party, each Grantor shall
execute and deliver to Secured Party an assignment or assignments of the
Patents, Trademarks, Registrations, Trademark Rights and the Associated
Goodwill and such other documents as are requested by Secured Party. Each
Grantor agrees that such an assignment and/or recording shall be applied to
reduce the Secured Obligations outstanding only to the extent that Secured
Party (or any Lender) receives cash proceeds in respect of the sale of, or
other realization upon, the Collateral.
(c) Within five Business Days after written notice from Secured
Party, each Grantor shall make available to Secured Party, to the extent
within each applicable Grantor's power and authority, such personnel in
such Grantor's employ on the date of such Event of Default as Secured Party
may reasonably designate, by name, title or job responsibility, to permit
such Grantor to continue, directly or indirectly, to produce, advertise and
sell the products and services sold or delivered by such Grantor under or
in connection with the Patents, Trademarks, Registrations and Trademark
Rights, such persons to be available to perform their prior functions on
Secured Party's behalf and to be compensated by Secured Party at Grantors'
expense on a per diem, pro rata basis consistent with the salary and
benefit structure applicable to each as of the date of such Event of
Default.
SECTION 14. Application of Proceeds.
Except as expressly provided elsewhere in this Agreement, all
proceeds received by Secured Party in respect of any sale of, collection
from, or other realization upon all or any part of the Collateral shall be
applied as provided in subsection 2.4D of the Credit Agreement.
SECTION 15. Indemnity and Expenses.
(a) Grantors jointly and severally agree to indemnify Secured
Party, each Lender and each Interest Rate Exchanger from and against any and
all claims, losses and liabilities in any way relating to, growing out of or
resulting from this Agreement and the transactions contemplated hereby
(including without limitation enforcement of this Agreement), except to the
extent such claims, losses or liabilities result solely from Secured Party's
or such Lender's or Interest Rate Exchanger's gross negligence or willful
misconduct as finally determined by a court of competent jurisdiction.
(b) Grantors jointly and severally agree to pay to Secured Party
upon demand the amount of any and all costs and expenses, including the
reasonable fees and expenses of its counsel and of any experts and agents,
that Secured Party may incur in connection with (i) the administration of
this Agreement, (ii) the custody, preservation, use or operation of, or the
sale of, collection from, or other realization upon, any of the Collateral,
(iii) the exercise or enforcement of any of
X-17
the rights of Secured Party hereunder, or (iv) the failure by any Grantor to
perform or observe any of the provisions hereof.
(c) The obligations of Grantors in this Section 15 shall survive
the termination of this Agreement and the discharge of Grantors' other
obligations under this Agreement, the Interest Rate Agreements, the Credit
Agreement and the other Loan Documents.
SECTION 16. Continuing Security Interest; Transfer of Loans.
This Agreement shall assign and create a continuing security
interest in the Collateral and shall (a) remain in full force and effect
until the payment in full of the Secured Obligations, the cancellation or
termination of the Commitments and the cancellation or expiration of all
outstanding Letters of Credit, (b) be binding upon Grantors and their
respective successors and assigns, and (c) inure, together with the rights
and remedies of Secured Party hereunder, to the benefit of Secured Party and
its successors, transferees and assigns. Without limiting the generality of
the foregoing clause (c), but subject to the provisions of subsection 10.1 of
the Credit Agreement, any Lender may assign or otherwise transfer any Loans
held by it to any other Person, and such other Person shall thereupon become
vested with all the benefits in respect thereof granted to Lenders herein or
otherwise. Upon the payment in full of all Secured Obligations, the
cancellation or termination of the Commitments and the cancellation or
expiration of all outstanding Letters of Credit, the security interest
assigned and granted hereby shall terminate and all rights to the Collateral
shall revert to the applicable Grantors. Upon any such termination Secured
Party will, at Grantors' expense, execute and deliver to Grantors such
documents as Grantors shall reasonably request to evidence such termination.
SECTION 17. Secured Party as Administrative Agent.
(a) Secured Party has been appointed to act as Secured Party
hereunder by Lenders and, by their acceptance of the benefits hereof,
Interest Rate Exchangers. Secured Party shall be obligated, and shall have
the right hereunder, to make demands, to give notices, to exercise or refrain
from exercising any rights, and to take or refrain from taking any action
(including without limitation the release or substitution of Collateral),
solely in accordance with this Agreement and the Credit Agreement; provided
that Secured Party shall exercise, or refrain from exercising, any remedies
provided for in Section 13 in accordance with the instructions of (i)
Requisite Lenders or (ii) after payment in full of all Obligations under the
Credit Agreement and the other Loan Documents, the holders of a majority of
the aggregate notional amount (or, with respect to any Lender Interest Rate
Agreement that has been terminated in accordance with its terms, the amount
then due and payable (exclusive of expenses and similar payments but
including any early termination payments then due) under such Lender Interest
Rate Agreement) under all Lender Interest Rate Agreements (Requisite Lenders
or, if applicable, such holders being referred to herein as
X-18
"Requisite Obligees"). In furtherance of the foregoing provisions of this
Section 17(a), each Interest Rate Exchanger, by its acceptance of the
benefits hereof, agrees that it shall have no right individually to realize
upon any of the Collateral hereunder, it being understood and agreed by such
Interest Rate Exchanger that all rights and remedies hereunder may be
exercised solely by Secured Party for the benefit of Lenders and Interest
Rate Exchangers in accordance with the terms of this Section 17(a).
(b) Secured Party shall at all times be the same Person that is
Administrative Agent under the Credit Agreement. Written notice of
resignation by Administrative Agent pursuant to subsection 9.5 of the Credit
Agreement shall also constitute notice of resignation as Secured Party under
this Agreement; removal of Administrative Agent pursuant to subsection 9.5 of
the Credit Agreement shall also constitute removal as Secured Party under
this Agreement; and appointment of a successor Administrative Agent pursuant
to subsection 9.5 of the Credit Agreement shall also constitute appointment
of a successor Secured Party under this Agreement. Upon the acceptance of
any appointment as Administrative Agent under subsection 9.5 of the Credit
Agreement by a successor Administrative Agent, that successor Administrative
Agent shall thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the retiring or removed Secured Party under
this Agreement, and the retiring or removed Secured Party under this
Agreement shall promptly (i) transfer to such successor Secured Party all
sums, securities and other items of Collateral held hereunder, together with
all records and other documents necessary or appropriate in connection with
the performance of the duties of the successor Secured Party under this
Agreement, and (ii) execute and deliver to such successor Secured Party such
amendments to financing statements, and take such other actions, as may be
necessary or appropriate in connection with the assignment to such successor
Secured Party of the security interests created hereunder, whereupon such
retiring or removed Secured Party shall be discharged from its duties and
obligations under this Agreement. After any retiring or removed
Administrative Agent's resignation or removal hereunder as Secured Party, the
provisions of this Agreement shall inure to its benefit as to any actions
taken or omitted to be taken by it under this Agreement while it was Secured
Party hereunder.
SECTION 18. Amendments; Etc.
No amendment, modification, termination or waiver of any provision
of this Agreement, and no consent to any departure by any Grantor therefrom,
shall in any event be effective unless the same shall be in writing and
signed by Secured Party and, in the case of any such amendment or
modification, by Grantors; provided that any amendment hereto pursuant to
Section 21 or Section 5(c) shall be effective upon execution by any
Additional Grantor and Grantors hereby waive any requirement of notice of or
consent to any such amendment. Any such waiver or consent shall be effective
only in the specific
X-19
instance and for the specific purpose for which it was given.
SECTION 19. Notices.
Any notice or other communication herein required or permitted to
be given shall be in writing and may be personally served, telexed or sent by
telefacsimile or United States mail or courier service and shall be deemed to
have been given when delivered in person or by courier service, upon receipt
of telefacsimile or telex (with received answerback), or three Business Days
after depositing it in the United States mail with postage prepaid and
properly addressed; provided that notices to Secured Party shall not be
effective until received. For the purposes hereof, the address of each party
hereto shall be provided in subsection 10.8 of the Credit Agreement or as set
forth under such party's name on the signature pages hereof or such other
address as shall be designated by such party in a written notice delivered to
the other parties hereto.
SECTION 20. Failure or Indulgence Not Waiver;
Remedies Cumulative.
No failure or delay on the part of Secured Party in the exercise of
any power, right or privilege hereunder shall impair such power, right or
privilege or be construed to be a waiver of any default or acquiescence
therein, nor shall any single or partial exercise of any such power, right or
privilege preclude any other or further exercise thereof or of any other
power, right or privilege. All rights and remedies existing under this
Agreement are cumulative to, and not exclusive of, any rights or remedies
otherwise available.
SECTION 21. Additional Grantors.
From time to time subsequent to the date hereof, Subsidiaries of
Company may become parties hereto as additional Grantors (each an "Additional
Grantor") by executing an acknowledgement to this Agreement substantially in
the form of Schedule VI annexed hereto. Upon delivery of any such
acknowledgment to Administrative Agent and Secured Party, notice of which is
hereby waived by Grantors, each such Additional Grantor shall be a Grantor
and shall be as fully a party hereto as if such Additional Grantor were an
original signatory hereto. Each Grantor expressly agrees that its obligations
arising hereunder shall not be affected or diminished by the addition or
release of any other Grantor hereunder, nor by any election of Administrative
Agent not to cause any Subsidiary of Company to become an Additional Grantor
hereunder. This Agreement shall be fully effective as to any Grantor that is
or becomes a party hereto regardless of whether any other Person becomes or
fails to become or ceases to be a Grantor hereunder.
SECTION 22. Severability.
In case any provision in or obligation under this
X-20
Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction,
shall not in any way be affected or impaired thereby.
SECTION 23. Headings.
Section and subsection headings in this Agreement are included
herein for convenience of reference only and shall not constitute a part of
this Agreement for any other purpose or be given any substantive effect.
SECTION 24. Governing Law; Terms; Rules of Construction.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE
OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES, EXCEPT TO THE
EXTENT THAT THE CODE PROVIDES THAT THE PERFECTION OF THE SECURITY INTEREST
HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE
GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
Unless otherwise defined herein or in the Credit Agreement, terms used in
Articles 8 and 9 of the Uniform Commercial Code in the State of New York are
used herein as therein defined. The rules of construction set forth in
subsection 1.3 of the Credit Agreement shall be applicable to this Agreement
mutatis mutandis.
SECTION 25. Consent to Jurisdiction and Service of Process.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY GRANTOR ARISING OUT OF
OR RELATING TO THIS AGREEMENT, OR ANY OBLIGATIONS HEREUNDER, MAY BE BROUGHT
IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN XXX XXXXX, XXXXXX
XXX XXXX XX XXX XXXX BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH
GRANTOR, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (I)
ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE
OF SUCH COURTS; (II) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (III) AGREES
THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE
MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO SUCH
GRANTOR AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 19; (IV) AGREES
THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE IS SUFFICIENT TO CONFER
PERSONAL JURISDICTION OVER SUCH GRANTOR IN ANY SUCH PROCEEDING IN ANY SUCH
COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY
RESPECT; (V) AGREES THAT SECURED PARTY RETAINS THE RIGHT TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST SUCH
GRANTOR IN THE COURTS OF ANY OTHER JURISDICTION; AND (VI) AGREES THAT THE
PROVISIONS OF THIS SECTION 25 RELATING TO JURISDICTION AND VENUE SHALL BE
BINDING AND ENFORCEABLE TO THE FULLEST EXTENT PERMISSIBLE UNDER NEW YORK
GENERAL OBLIGATIONS LAW SECTION 5-1402 OR OTHERWISE.
X-21
SECTION 26. Waiver of Jury Trial.
GRANTORS AND SECURED PARTY HEREBY AGREE TO WAIVE THEIR RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF THIS AGREEMENT. The scope of this waiver is intended to be
all-encompassing of any and all disputes that may be filed in any court and
that relate to the subject matter of this transaction, including without
limitation contract claims, tort claims, breach of duty claims, and all other
common law and statutory claims. Each Grantor and Secured Party acknowledge
that this waiver is a material inducement for Grantors and Secured Party to
enter into a business relationship, that Grantors and Secured Party have
already relied on this waiver in entering into this Agreement and that each
will continue to rely on this waiver in their related future dealings. Each
Grantor and Secured Party further warrant and represent that each has
reviewed this waiver with its legal counsel, and that each knowingly and
voluntarily waives its jury trial rights following consultation with legal
counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED
EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER
SPECIFICALLY REFERRING TO THIS SECTION 26 AND EXECUTED BY EACH OF THE PARTIES
HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. In the event of litigation,
this Agreement may be filed as a written consent to a trial by the court.
SECTION 27. Counterparts.
This Agreement may be executed in one or more counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages
may be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document.
[Remainder of page intentionally left blank]
X-22
IN WITNESS WHEREOF, Grantors and Secured Party have caused this
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
AURORA FOODS INC.
By:
---------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK,
as Secured Party
By:
---------------------------------
Name:
Title:
X-23
SCHEDULE I
TO
VAN XX XXXX'X PATENT AND TRADEMARK SECURITY AGREEMENT
Registered United States Registration Registration
Owner Trademark Description Number Date
------------ --------------------- ------------ ------------
X-24
SCHEDULE II
TO
VAN XX XXXX'X PATENT AND TRADEMARK SECURITY AGREEMENT
PATENTS ISSUED
--------------
Patent No. Issue Date Invention
---------- ---------- ---------
PATENTS PENDING
Applicant's Name Date Filed Application No. Invention Inventor
---------------- ---------- -------------- --------- --------
X-25
SCHEDULE III
TO
VAN XX XXXX'X PATENT AND TRADEMARK SECURITY AGREEMENT
Office Locations
Name of Grantor ---------------- Office Location
--------------- ---------------
X-26
SCHEDULE IV
TO
VAN XX XXXX'X PATENT AND TRADEMARK SECURITY AGREEMENT
Other Names
Name of Grantor ----------- Other Names
--------------- -----------
X-27
SCHEDULE V
TO
VAN XX XXXX'X PATENT AND TRADEMARK SECURITY AGREEMENT
Filing Offices
--------------
X-28
SCHEDULE VI
TO VAN XX XXXX'X PATENT AND TRADEMARK SECURITY AGREEMENT
[FORM OF ACKNOWLEDGEMENT]
This Acknowledgement, dated __________________, [199_] [200_], is
delivered pursuant to Section 21 of the Van Xx Xxxx'x Patent and Trademark
Security Agreement referred to below. The undersigned hereby agrees that
this Acknowledgement may be attached to the Van Xx Xxxx'x Patent and
Trademark Security Agreement dated July 1, 1998, by and among the Grantors
referred to therein and The Chase Manhattan Bank, as Secured Party (the "Van
Xx Xxxx'x Patent and Trademark Security Agreement", capitalized terms defined
therein being used herein as therein defined), that the undersigned by
executing and delivering this Acknowledgement hereby becomes a Grantor under
the Van Xx Xxxx'x Patent and Trademark Security Agreement in accordance with
Section 21 thereof and agrees to be bound by all of the terms thereof, and
that the Patents, Registrations and Trademark Rights described on this
Acknowledgement shall be deemed to be part of the and shall become part of
the Collateral and shall secure all Secured Obligations.
[NAME OF ADDITIONAL GRANTOR]
By:
--------------------------------
Name:
Title:
Notice Address:
-----------------------------------
-----------------------------------
-----------------------------------
-----------------------------------
X-29
Trademark Registrations
Registered Trademark Registration Registration
Owner Description Number Date Jurisdiction
---------- ----------- ------------ ------------ ------------
Patents Issued
Patent No. Issue Date Invention Inventor
--------- ---------- --------- --------
Patents Pending
Applicant's Name Date Filed Application No. Invention Inventor
---------------- ---------- -------------- --------- --------
X-30
EXHIBIT XI
[FORM OF COMPLIANCE CERTIFICATE]
COMPLIANCE CERTIFICATE
THE UNDERSIGNED HEREBY CERTIFIES THAT:
(1) I am the duly elected [Title] of Aurora Foods Inc., a Delaware
corporation ("Company");
(2) I have reviewed the terms of that certain Third Amended and
Restated Credit Agreement dated as of July 1, 1998, by and among Company, the
financial institutions listed therein as Lenders, The Chase Manhattan Bank, as
Administrative Agent, National Westminster Bank PLC, as Syndication Agent, and
UBS AG, Stamford Branch, as Documentation Agent, as amended, restated,
supplemented or otherwise modified to the date hereof (said Third Amended and
Restated Credit Agreement, as so amended, restated, supplemented or otherwise
modified, being the "Credit Agreement", the terms defined therein and not
otherwise defined in this Certificate (including Attachment No. 1 annexed hereto
and made a part hereof) being used in this Certificate as therein defined), and
the terms of the other Loan Documents, and I have made, or have caused to be
made under my supervision, a review in reasonable detail of the transactions and
condition of Company and its Subsidiaries during the accounting period covered
by the attached financial statements; and
(3) The examination described in paragraph (2) above did not
disclose, and I have no knowledge of, the existence of any condition or event
which constitutes an Event of Default or Potential Event of Default during or at
the end of the accounting period covered by the attached financial statements or
as of the date of this Certificate[, except as set forth below].
[Set forth [below] [in a separate attachment to this Certificate] are
all exceptions to paragraph (3) above listing, in detail, the nature of the
condition or event, the period during which it has existed and the action which
Company has taken, is taking, or proposes to take with respect to each such
condition or event:
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
XI-1
The foregoing certifications, together with the computations set forth
in Attachment No. 1 annexed hereto and made a part hereof and the financial
statements delivered with this Certificate in support hereof, are made and
delivered this __ day of ________, [199_] [200_] pursuant to subsection 6.1(iv)
of the Credit Agreement.
AURORA FOODS INC.
By:
----------------------------------
Name:
Title:
XI-2
ATTACHMENT NO. 1
TO COMPLIANCE CERTIFICATE
This Attachment No. 1 is attached to and made a part of a Compliance
Certificate dated as of ______________, [199_][200_] and pertains to the period
from ______________, [199_][200_], to [199_][200_]. Subsection references
herein to relate to subsections of the Credit Agreement.
-------------------------------------------------------------------------------
A. Indebtedness
-------------------------------------------------------------------------------
1. Indebtedness under Capital Leases of
the type described in subsection
7.1(iii)(a): $__________
-------------------------------------------------------------------------------
2. Indebtedness in respect of sale and
lease-back transactions expressly
permitted under subsection 7.8: $__________
-------------------------------------------------------------------------------
3. Indebtedness secured by Liens permitted
under subsection 7.2A(iii): $__________
-------------------------------------------------------------------------------
4. Indebtedness of the type described in
subsection 7.1(iii) (A.1 + A.2 + A.3): $__________
-------------------------------------------------------------------------------
5. Maximum Indebtedness permitted under
subsection 7.1(iii): $10,000,000
-------------------------------------------------------------------------------
6. Aggregate principal amount of Permitted
Seller Notes issued after the Effective
Date: $__________
-------------------------------------------------------------------------------
7. Maximum principal amount permitted under
subsection 7.1(vii): $10,000,000
-------------------------------------------------------------------------------
8. Indebtedness of the type described in
subsection 7.1(viii): $__________
-------------------------------------------------------------------------------
9. Maximum Indebtedness permitted under
subsection 7.1(viii): $15,000,000
-------------------------------------------------------------------------------
B. Liens
-------------------------------------------------------------------------------
1. Indebtedness secured by Liens described
in subsection 7.2A(iii): $__________
-------------------------------------------------------------------------------
2. Original purchase price (or cost of
acquisition, construction or improvement)
of assets financed with Indebtedness
secured by Liens permitted under
subsection 7.2A(iii): $__________
-------------------------------------------------------------------------------
3. Percentage of purchase price (or cost of
acquisition, construction or improvement)
financed with Indebtedness secured by
Liens permitted under subsection
7.2A(iii) ((B. 1)/(B.2)): $___________
-------------------------------------------------------------------------------
4. Maximum percentage permitted to be
-------------------------------------------------------------------------------
XI-3
-------------------------------------------------------------------------------
financed under subsection 7.2A(iii): 100%
-------------------------------------------------------------------------------
5. Minimum percentage permitted to be
financed under subsection 7.2A(iii): 80%
-------------------------------------------------------------------------------
6. Proceeds of Indebtedness permitted by
subsection 7.1(iii)(c) incurred during
period and secured by Liens on assets: $__________
-------------------------------------------------------------------------------
7. Fair market value of assets securing
Liens described in item B.6: $__________
-------------------------------------------------------------------------------
8. Percentage of fair market value
constituted by proceeds of Indebtedness
((B.6)/(B.7)): $__________
-------------------------------------------------------------------------------
9. Minimum percentage permitted under
subsection 7.2A(iv): 80%
-------------------------------------------------------------------------------
10. Indebtedness secured by Liens described
in subsection 7.2A(vi): $__________
-------------------------------------------------------------------------------
11. Indebtedness secured by Liens on assets
under Capital Leases permitted under
subsection 7.2A(v): $__________
-------------------------------------------------------------------------------
12. Maximum Indebtedness permitted to be
secured by Liens under subsection
7.2A(vi): $2,500,000
-------------------------------------------------------------------------------
C. Investments
-------------------------------------------------------------------------------
1. Investments consisting of advances made
during Fiscal Year-to-date to make
payments contemplated by subsection
7.5(v)(a): $__________
-------------------------------------------------------------------------------
2. Minimum permitted under subsection
7.5(v)(a): $_________
-------------------------------------------------------------------------------
3. Investments of the type described in
subsection 7.3(iii): $__________
-------------------------------------------------------------------------------
4. Maximum permitted under subsection
7.3(v): $7,500,000
-------------------------------------------------------------------------------
XI-4
-------------------------------------------------------------------------------
D. Contingent Obligations
-------------------------------------------------------------------------------
1. Net amount which Company would be liable
to pay to counterparties under Interest
Rate Agreements of the type described in
subsection 7.4(iii) in the event such
Interest Rate Agreements were terminated
on the date hereof: $__________
-------------------------------------------------------------------------------
2. Maximum amount permitted under subsection
7.4(iii): $2,500,000
-------------------------------------------------------------------------------
3. Contingent Obligations under guarantees
in the ordinary course of business of the
type described in subsection 7.4(v): $__________
-------------------------------------------------------------------------------
4. Maximum permitted under subsection
7.4(v): $500,000
-------------------------------------------------------------------------------
5. Contingent Obligations of the type
described in subsection 7.4(vii): $__________
-------------------------------------------------------------------------------
6. Maximum permitted under subsection
7.4(vii): $500,000
-------------------------------------------------------------------------------
E. Restricted Junior Payments
-------------------------------------------------------------------------------
1. Restricted Junior Payments made during
Fiscal Year-to-date of the type described
in subsection 7.5(v)(a): $__________
-------------------------------------------------------------------------------
2. Aggregate advances made during Fiscal
Year-to-date to make payments
contemplated by subsection 7.5(v)(a) (E.1
+ C.1): $__________
-------------------------------------------------------------------------------
3. Maximum permitted under subsection
7.5(v)(a): $__________
-------------------------------------------------------------------------------
4. Restricted Junior Payments made after the
Effective Date of the type described in
subsection 7.5(vi): $__________
-------------------------------------------------------------------------------
5. Maximum permitted under subsection
7.5(vi): $2,000,000
-------------------------------------------------------------------------------
F. Minimum Interest Coverage Ratio
([calculated on a pro forma basis for
Fiscal Quarters ending prior to the
Effective Date for the four-Fiscal
Quarter period ending, _________ [199_]
[200 ]) $__________
-------------------------------------------------------------------------------
1. Consolidated Net Income:
-------------------------------------------------------------------------------
2. Consolidated Interest Expense (to the
extent deducted in determining
Consolidated Net Income): $__________
-------------------------------------------------------------------------------
3. Depreciation (to the extent deducted in
XI-5
-------------------------------------------------------------------------------
determining Consolidated Net Income): $__________
-------------------------------------------------------------------------------
4. Depletion (to the extent deducted in
determining Consolidated Net Income): $__________
-------------------------------------------------------------------------------
5. Amortization (to the extent deducted in
determining Consolidated Net Income): $__________
-------------------------------------------------------------------------------
6. Federal, state, local and foreign income
taxes (to the extent deducted in
determining Consolidated Net Income): $__________
-------------------------------------------------------------------------------
7. Transaction fees paid to the MDC Entities
and/or Dartford and/or Fenway in
connection with acquisitions made in
accordance with the terms of the MDC
Advisory Services Agreement, the Dartford
Management Agreement and the Fenway
Agreement (to the extent deducted in
determining Consolidated Net Income): $__________
-------------------------------------------------------------------------------
8. Non-recurring charges incurred prior to
_________ __, 1998 with respect to
relocation of Company's assets related to
the Business and the Log Cabin Business
(to the extent deducted in determining
Consolidated Net Income) (if greater than
$6,000,000, enter "$6,000,000"): $__________
-------------------------------------------------------------------------------
9. Non-recurring charges incurred prior to
_________ __, 1999 with respect to
relocation of the Company's assets (if
greater than $15,000,000, enter
"$15,000,000"): $__________
-------------------------------------------------------------------------------
10. Manufacturing overhead charges related to
the Xxxxxx Xxxxx Transitional Supply
Agreement (if greater than $8,200,000,
enter "$8,200,000"): $__________
-------------------------------------------------------------------------------
11. Other non-cash items reducing
Consolidated Net Income (to the extent
deducted in determining Consolidated Net
Income): $__________
-------------------------------------------------------------------------------
12. Extraordinary and unusual losses (to the
extent deducted in determining
Consolidated Net Income): $__________
-------------------------------------------------------------------------------
13. Non-cash items increasing Consolidated
Net Income: $__________
-------------------------------------------------------------------------------
14. Extraordinary and unusual gains: $__________
-------------------------------------------------------------------------------
15. Consolidated EBITDA ((F.1 + F.2 + F.3 +
F.4 + F.5 + F.6 + F.7 + F.8 + F.9 + F.10)
- (F.11 + F.12)): $__________
-------------------------------------------------------------------------------
16. Consolidated Cash Interest Expense: $__________
-------------------------------------------------------------------------------
17. Interest Coverage Ratio ((F.13):(F.14)): _____:1.00
-------------------------------------------------------------------------------
XI-6
-------------------------------------------------------------------------------
18. Minimum Interest Coverage Ratio required
under section 7.6A: _____:1.00
-------------------------------------------------------------------------------
G. Maximum Leverage Ratio ([calculated on a
pro forma basis for Fiscal Quarters
ending prior to the Effective Date] as of
____________, [199_] [200_]) $__________
-------------------------------------------------------------------------------
1. Consolidated Total Debt: $__________
-------------------------------------------------------------------------------
2. Cash on hand of Company minus $3,500,000
(if difference is equal to or less than
zero, enter "0"): $__________
-------------------------------------------------------------------------------
3. Consolidated EBITDA for the four-Fiscal
Quarter period ended on the above date
(F.13 above): $__________
-------------------------------------------------------------------------------
4. Leverage Ratio ((G.1- G.2)/G.3):
-------------------------------------------------------------------------------
5. Maximum Leverage Ratio permitted under
subsection 7.6B: _____: 1.00
-------------------------------------------------------------------------------
H. Minimum Fixed Charge Coverage Ratio
([calculated on a pro forma basis for
Fiscal Quarters ending prior to the
Effective Date] for the four-Fiscal
Quarter period ending ___________,
[199_][200_]) $__________
-------------------------------------------------------------------------------
1. Consolidated EBITDA (F.13 above): $__________
-------------------------------------------------------------------------------
2. Scheduled amortization of Indebtedness of
and its Subsidiaries (as reduced by
payments previously made), and discount
or premium relating to any such
Indebtedness, whether expensed or
capitalized: $__________
-------------------------------------------------------------------------------
3. Consolidated Cash Interest Expense (F.14
above): $__________
-------------------------------------------------------------------------------
4. Consolidated Capital Expenditures: $__________
-------------------------------------------------------------------------------
5. Taxes actually paid in cash by
Subsidiaries: $__________
-------------------------------------------------------------------------------
6. Consolidated Fixed Charges (H.2 + H.3 +
H.4 + H.5): $__________
-------------------------------------------------------------------------------
7. Fixed Charge Coverage Ratio
((H.1):(H.6)): _____:1.00
-------------------------------------------------------------------------------
8. Minimum Fixed Charge Coverage Ratio
required under subsection 7.6C: _____:1.00
-------------------------------------------------------------------------------
I. Consolidated Capital Expenditures (for
the Fiscal Year ending ___________in
December [199_] [200_] [to date]) $__________
XI-7
-------------------------------------------------------------------------------
1. Consolidated Capital Expenditures: $__________
-------------------------------------------------------------------------------
2. Maximum Consolidated Capital Expenditures
Amount permitted under subsection 7.6D
(as adjusted (calculations and supporting
information therefor attached hereto) in
accordance with the provisos to such
subsection): $__________
-------------------------------------------------------------------------------
J. Fundamental Changes
-------------------------------------------------------------------------------
1. Aggregate fair market value of assets
sold in Asset Sales described in
subsection 7.7(v) during the period
commencing ___________, [199_] [200_]: $__________
-------------------------------------------------------------------------------
2. Consolidated EBITDA (F. 13 above): $__________
-------------------------------------------------------------------------------
3. Maximum Asset Sales permitted under
subsection 7.7(v) (.10 x (J. 2)): $__________
-------------------------------------------------------------------------------
4. Consideration received in Asset Sales
described in subsection 7.7(vi) during
the period commencing ___________, [199_]
[200_]: $__________
-------------------------------------------------------------------------------
5. Cash consideration received in Asset
Sales described in subsection 7.7(v)
during the period commencing
___________, [199_] [200_]: $__________
-------------------------------------------------------------------------------
6. Minimum cash consideration permitted
under subsection 7.7(v) (.80 x (J.4)): $__________
-------------------------------------------------------------------------------
[K. Consolidated Excess Cash Flow (for the
Fiscal Year ending December 31, [199_]
[200 ]) [ONLY USE FOR FISCAL YEAR [1998]
AND THEREAFTER] $__________
-------------------------------------------------------------------------------
1. Consolidated EBITDA (F.13 above): $__________
-------------------------------------------------------------------------------
2. Extraordinary and unusual cash gains (to
the extent included in item F.12 above): $__________
-------------------------------------------------------------------------------
3. Consolidated Working Capital Adjustment: $__________
-------------------------------------------------------------------------------
4. Voluntary and scheduled cash repayments
of Consolidated Total Debt (excluding
repayments of Revolving Loans except to
the extent the Revolving Loan Commitments
are permanently reduced): $__________
-------------------------------------------------------------------------------
5. Consolidated Capital Expenditures (net of
any proceeds of related financings with
respect to such expenditures): $__________
-------------------------------------------------------------------------------
6. Expenditures made in connection with any
Permitted Acquisition pursuant to
subsection 7.7(vi) (net of any proceeds
XI-8
-------------------------------------------------------------------------------
of related financings with respect to
such acquisitions), including without
limitation transaction fees paid in cash
to the MDC Entities and/or Dartford
and/or Fenway, in connection with such
acquisitions in accordance with the terms
of the MDC Advisory Services Agreement,
the Dartford Management Agreement and the
Fenway Agreement: $__________
-------------------------------------------------------------------------------
7. Consolidated Interest Expense (F.14
above): $__________
-------------------------------------------------------------------------------
8. Extraordinary and unusual cash losses (to
the extent included in item F.10 above): $__________
-------------------------------------------------------------------------------
9. Consolidated Excess Cash Flow ((K.1 + K2
+ K3) - (K.4 + K5 + K.6 + K.7 + K8)): $__________
-------------------------------------------------------------------------------
10. Portion of Consolidated Excess Cash Flow
required to be prepaid (.50x or .25x if
Leverage Ratio is less than ____:1.00
(K.9)) $__________
-------------------------------------------------------------------------------
XI-9
EXHIBIT XII
[FORM OF OPINION OF COUNSEL TO LOAN PARTIES]
[LETTERHEAD OF WHITE & CASE]
July 1, 1998
The Chase Manhattan Bank,
as Administrative Agent under the
Third Amended and Restated Credit
Agreement referred to below
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
National Westminster Bank PLC,
as Syndication Agent under the
Third Amended and Restated Credit
Agreement referred to below
--------------------
--------------------
UBS AG, Stamford Branch,
as Documentation Agent under the
Third Amended and Restated Credit
Agreement referred to below
--------------------
--------------------
and
The Lenders Listed on
Schedule A Annexed Hereto
Re: Third Amended and Restated Credit Agreement dated as of July 1,
1998, by and among Aurora Foods Inc., the financial institutions
listed therein as Lenders, The Chase Manhattan Bank, as
Administrative Agent, National Westminster Bank PLC, as
Syndication Agent, and UBS AG, Stamford Branch, as Documentation
Agent
Ladies and Gentlemen:
We have acted as special counsel to (i) Aurora Foods Inc., a Delaware
corporation ("Company"), in connection with that certain Third Amended and
Restated Credit Agreement dated as of July 1, 1998 (the "Credit Agreement";
capitalized terms used herein without definition have the same meanings as in
the Credit Agreement), by and among Company, the financial institutions listed
therein as Lenders, The Chase Manhattan Bank, as
XII-1
Administrative Agent, National Westminster Bank PLC, as Syndication Agent,
and UBS AG, Stamford Branch, as Documentation Agent and (ii) the Loan Parties
in connection with documents executed in connection with the Credit
Agreement. This opinion is rendered to you in compliance with subsection
4.1J of the Credit Agreement.
In our capacity as such counsel, we have examined originals, or copies
identified to our satisfaction as being true copies, of such records, documents
or other instruments as in our judgment are necessary or appropriate to enable
us to render the opinions expressed below. These records, documents and
instruments included the following:
(a) All records of proceedings and actions of the respective Boards
of Directors of each of the Loan Parties relating to the Credit Agreement
and the transactions contemplated thereby;
(b) The Credit Agreement;
(c) The Revolving Credit and Tranche A Term Notes delivered on the
Effective Date (collectively, the "Notes");
(d) The Collateral Account Agreement;
(e) The Pledge Agreement;
(f) The Security Agreement;
(g) The Mortgages;
(h) The Van Xx Xxxx'x Patent and Trademark Security Agreement; and
(i) Copies of Uniform Commercial Code financing statements and
fixture filings (collectively, the "Financing Statements") to be filed in
the filing offices listed for the Company on Schedule I annexed hereto (the
"Filing Offices") in the states (the "Relevant States") in which such
Filing Offices are located.
The documents referenced in items (b) through (i) above are
collectively referred to herein as the "Loan Documents".
In connection with this opinion, we have also examined such other
agreements, documents, certificates and other statements of government officials
and corporate officers of the Loan Parties and such other papers as we have
deemed necessary as a basis for such opinions. In all such examinations, we
have assumed the genuineness of all signatures on original and certified
documents and the conformity to original or certified documents of all documents
submitted to us as conformed or photostatic copies.
On the basis of the foregoing, and in reliance thereon, and subject to
the limitations, qualifications and exceptions set
XII-2
forth below, we are of the opinion that:
1. Each Loan Party is duly incorporated, validly existing and in
good standing under the laws of the State of Delaware and has all corporate
power and authority necessary to own and operate its properties and carry out
its business as now conducted.
2. Each Loan Party has all requisite corporate power and authority
to execute and deliver the Loan Documents to which it is a party and any
financing statements or fixture filings to be executed in connection therewith
(collectively, the "Financing Statements") in which it is named as Debtor and to
perform the Loan Documents to which it is a party and to carry out the
transactions contemplated thereby.
3. The authorized and outstanding capital stock of each Loan Party
is as set forth on Schedule B annexed hereto. The Loan Party listed on Schedule
C annexed hereto is the record owner of the Pledged Shares (as defined in the
Pledge Agreement).
4. The execution and delivery of each of the Loan Documents and the
Financing Statements and the performance of each of the Loan Documents have been
duly authorized by all necessary corporate action on the part of each Loan Party
which is a party thereto or which is named therein as a Debtor. Each Loan
Document and each Financing Statement has been duly executed and delivered by
each Loan Party which is a party thereto or which is named therein as a Debtor,
and each Loan Document constitutes the valid and binding obligation of such Loan
Party, enforceable against such Loan Party in accordance with its terms, except
as the enforcement thereof may be limited by applicable bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of creditors'
rights generally or by general equitable principles (regardless of whether the
issue of enforceability is considered in a proceeding in equity or at law).
5. None of the execution or delivery by the Loan Parties of the Loan
Documents to which it is a party or the Financing Statements in which it is
named as a debtor nor the performance by the Loan Parties of the Loan Documents
nor the consummation of the transactions contemplated thereby will (i) conflict
with, result in a breach or violation of, or constitute a default under, any of
the terms, conditions or provisions of any New York State or Federal or Delaware
corporation law, statute, rule or regulation (including, without limitation,
Regulations T, U or X of the Board of Governors of the Federal Reserve System)
or any order, writ, judgment, injunction or decree of any New York State or
Federal court or other adjudicative body or arbitrator to which Company or any
Loan Party or any of their respective assets or properties is subject and of
which we are aware, or (ii) result in the creation of any Lien upon any of the
properties or assets of any Loan Party under any order referred to in clause (i)
above (other than Liens created pursuant to the Loan Documents and the Financing
Statements).
XII-3
6. Upon delivery to the Administrative Agent pursuant to the Pledge
Agreement of the certificates representing the Pledged Shares, and assuming (i)
continued possession by the Administrative Agent (or an agent of the
Administrative Agent) of the certificates representing the Pledged Shares in the
State or New York, (ii) that the Administrative Agent has taken delivery of the
certificates representing the Pledged Shares in good faith and (iii) that
neither the Administrative Agent nor any Lender has notice, prior to or on the
date of delivery of such Pledged Shares, of an adverse claim within the meaning
of the Uniform Commercial Code (the "UCC") as in effect on the date hereof in
the State of New York (the "New York UCC"), the execution of the Pledge
Agreement by the Loan Parties will create a perfected security interest in favor
of the Administrative Agent in the Pledged Shares, which security interest has
priority over all other liens except as follows:
(a) we express no opinion as to any Loan Party's right in or title to
the Pledged Shares;
(b) priority may be subject to claims or liens in favor of the United
States, or any State of the United States or any agency, instrumentality or
political subdivision thereof, including, without limitation, (i) liens for
the payment of Federal, state or local taxes which are given priority by
operation of law, (ii) liens under Title IV of the Employee Retirement
Income Security Act of 1974, as amended, and (iii) claims arising under the
Federal Priority Statute (31 U.S.C. Section 3713);
(c) we express no opinion as to the security interest of the
Administrative Agent in proceeds of or distributions on the Pledged Shares;
and
(d) we express no opinion as to the priority of the security
interests in the Pledged Shares as against any lien creditor (as such term
is defined in Article 9 of the New York UCC) or any buyer, to the extent
that the security interests therein purport to secure any advances or other
extensions of credit other than obligations incurred pursuant to existing
commitments under the Credit Agreement.
7. The Security Agreement creates a valid lien and security interest
in favor of the Administrative Agent in the Collateral (as defined in the
Security Agreement) purported to be covered thereby. The Financing Statements
are in appropriate form and upon the filing of such Financing Statements in the
applicable Filing Offices, assuming that the representations made by each of the
Loan Parties in the Security Agreement with respect to the locations of their
respective Collateral (as defined in the Security Agreement) are true and
correct, all filings, registrations and recordings necessary or appropriate to
create, maintain, preserve, protect and perfect the security interests granted
by each Loan Party to Administrative Agent under the Security Agreement in
respect of all Collateral (as defined in the Security Agreement) will have been
accomplished in
XII-4
accordance with the UCC as in effect on the date hereof in the respective
Relevant States and the security interests granted by the Loan Parties to the
Administrative Agent pursuant to the Security Agreement in and to such
Collateral will constitute perfected security interests therein to the extent
that such Collateral consists of the type of property in which a security
interest may be perfected by filing a financing statement or fixture
financing statement, as applicable, under the UCC as in effect on the date
hereof in the Relevant States except as follows:
(a) we express no opinion as to perfection of the security interest
of the Administrative Agent in machinery and equipment physically located
at [the plant of Cereal Food Processors, Inc. in Xxxxxx Springs, Kansas] to
the extent such machinery and equipment are fixtures as defined in Section
9-313 of the UCC;
(b) we express no opinion as to the security interest of the
Administrative Agent in proceeds of or distributions on the Collateral;
(c) in the case of Collateral referred to in this paragraph 9,
Article 9 of the UCC requires the filing of continuation statements within
the period of six months prior to the expiration of five years from the
date of the original filings, in order to maintain the effectiveness of the
filings referred to in this paragraph; and
(d) in the case of property which becomes Collateral after the date
hereof, Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Bankruptcy Code limits the extent
to which priority acquired by a debtor after the commencement of a case
under the Federal Bankruptcy Code may be subject to a security interest
arising from a security agreement entered into by the debtor before the
commencement of such case.
8. Assuming the truth and accuracy of the representations of the
Loan Parties in the Van xx Xxxx'x Patent and Trademark Security Agreement, upon
the filing of the Financing Statements relating to the Collateral under the Van
xx Xxxx'x Patent and Trademark Security Agreement in the offices of the
Secretary of State of the Relevant States and the recording of the Van xx Xxxx'x
Patent and Trademark Security Agreement in the trademark records of the United
States Patent and Trademark Office and in the patent records of the United
States Patent and Trademark office, we are aware of no additional actions to be
taken in order to create and perfect security interests in favor of
Administrative Agent in the Trademarks (as defined in the Van xx Xxxx'x Patent
and Trademark Security Agreement) described on Schedule I annexed to the Van xx
Xxxx'x Patent and Trademark Security Agreement or the Patents (as defined in the
Van xx Xxxx'x Patent and Trademark Security Agreement) described on Schedule II
to the Van xx Xxxx'x Patent and Trademark Security Agreement. However, we
express no opinion as to the sufficiency of the foregoing actions to create and
perfect security interests in such Patents and Trademarks to the extent federal
law is
XII-5
determined to be applicable to the creation and perfection of such security
interests. In addition, we express no opinion as to whether federal law or
the laws of the states in which the Filing Offices are located governs the
validity or perfection of such security interests. We express no opinion as
to the validity or perfection of a security interest in the Trademarks
described on Schedule I annexed to the Van xx Xxxx'x Patent and Trademark
Security Agreement or the Patents described on Schedule II annexed to the Van
xx Xxxx'x Patent and Trademark Security Agreement to the extent the rights of
the Loan Parties in such Trademarks or Patents are granted, created or vested
under the laws of Puerto Rico, Canada or any other country or jurisdiction
outside the United States.
9. Upon receipt by Administrative Agent of any cash representing
Collateral under the Collateral Account Agreement and assuming Administrative
Agent maintains dominion and control of the Collateral Account in the manner set
forth in the Collateral Account Agreement, the Collateral Account Agreement will
create in favor of Administrative Agent a perfected security interest in the
Collateral Account.
10. The choice of law of the State of New York as the governing law
of each of the Loan Documents is a valid choice of law.
11. None of the Loan Parties is an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended. No Loan Party is a "holding company" or a
"subsidiary company" of a "holding company" or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company" within the meaning
of the Public Utility Holding Company Act of 1935, as amended.
12. [All Obligations under the Credit Agreement are within the
definition of "Designated Senior Indebtedness" contained in the subordination
provisions of the Subordinated Bridge Loan Documents.]
13. No law of the State of New York regulating the maximum rate of
interest which may be charged, taken or received applies to the Loans.
To the extent that the obligations of any of the Loan Parties may be
dependent upon such matters, we have assumed for purposes of this opinion (i)
that each party to the agreements and contracts referred to herein (including,
without limitation, the Loan Parties except in the case of clause (iii) of this
sentence) is duly incorporated, validly existing and in good standing under the
laws of its jurisdiction of incorporation; (ii) that each such party has the
requisite corporate or other organizational power and authority to perform its
obligations under such agreements and contracts, as applicable, and (iii) that
such agreements and contracts have been duly authorized, executed and delivered
by, and each of them constitutes the legally valid and binding obligation of,
such parties, as
XII-6
applicable, enforceable against such parties in accordance with their
respective terms. Except as expressly covered in this opinion, we are not
expressing any opinion as to the effect of compliance by any Lender with any
state or federal laws or regulations applicable to the transactions because
of the nature of any of its businesses.
The opinions contained in paragraphs 4, 6, 7, 8, and 9 are subject to
the following additional limitations, qualifications, exceptions and
assumptions:
(a) We express no opinion as to the enforceability of any
indemnification or contribution provisions in the Loan Documents to the
extent the rights to indemnification or contribution provided for therein
are violative of any law, rule or regulation (including any securities law,
rule or regulation) or public policy relating thereto.
(b) There may be limitations upon the exercise of remedial or
procedural provisions contained in the Loan Documents, but such limitations
do not make the rights and remedies provided in or contemplated by the Loan
Documents inadequate for the practical realization of the rights and
remedies afforded thereby.
(c) We express no opinion as the applicability to the Loan Documents
of Section 548 of the Bankruptcy Code (11 U.S.C. Section 548) or Article 10
of the New York Debtor and Creditor Law relating to fraudulent transfers
and obligations.
(d) We wish to point out that the law of the State of New York
generally imposes an obligation of good faith and reasonableness in the
performance and enforcement of contracts.
A copy of this opinion letter may be delivered by any of you to any
Eligible Assignee in connection with and at the time of any assignment and
delegation by any of you as a Lender to such Eligible Assignee of all or a
portion of your Loans and Commitments in accordance with the provisions of the
Credit Agreement, and such Eligible Assignee may rely on the opinions expressed
above as if this opinion letter were addressed and delivered to such Eligible
Assignee on the date hereof.
This opinion is rendered only to Syndication Agent, Documentation
Agent, Administrative Agent and Lenders and is solely for their benefit in
connection with the above transactions. This opinion may not be relied upon by
Syndication Agent, Documentation Agent, Administrative Agent or Lenders for any
other purpose, or quoted to or relied upon by any other person, firm or
corporation for any purpose without our prior written consent.
XII-7
The opinions expressed above are limited to questions arising under
the Federal law of the United States, the General Corporation Law of the State
of Delaware and the law of the State of New York, except that our opinions set
forth in paragraphs 7 and 8 above (to the extent governed by a law other than
that of the Federal law of the United States of America, the General Corporation
Law of the State of Delaware and the law of the State of New York) are based
upon our review of generally available compilations of law relating to such
matters.
Very truly yours,
White & Case
XII-8
SCHEDULE A
LENDERS
XII-9
SCHEDULE I
FILING OFFICES
XII-10
SCHEDULE B
CAPITALIZATION OF LOAN PARTIES
1. Aurora Foods Inc.
XII-11
SCHEDULE C
RECORD OWNERS OF PLEDGED SHARES
XII-12
EXHIBIT XIII
[FORM OF OPINION OF XXXXXXX XXXXXXX & XXXXXXXX]
July 1, 1998
The Chase Manhattan Bank,
as Administrative Agent
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
National Westminster Bank PLC,
as Syndication Agent
--------------------
--------------------
UBS AG, Stamford Branch,
as Documentation Agent
--------------------
--------------------
and
The Lenders Party to the Third
Amended and Restated Credit
Agreement Referenced Below
Re: Loans to Aurora Foods Inc.
Ladies and Gentlemen:
We have acted as counsel to The Chase Manhattan Bank, as
Administrative Agent (in such capacity, the "Administrative Agent"), National
Westminster Bank PLC, as Syndication Agent (in such capacity, the "Syndication
Agent"), and UBS AG, Stamford Branch, as Documentation Agent (in such capacity,
the "Documentation Agent"), in connection with the preparation and delivery of a
Third Amended and Restated Credit Agreement dated as of July 1, 1998 (the
"Credit Agreement") among Aurora Foods Inc., a Delaware corporation ("Company"),
the financial institutions listed therein as lenders ("Lenders"), the
Administrative Agent, Syndication Agent and Documentation Agent (collectively,
Administrative Agent, Syndication Agent and Documentation Agent are "Agents")
and in connection with the preparation and delivery of certain related
documents.
This opinion is delivered to you pursuant to Section 4.1(K) of the
Credit Agreement. Unless otherwise defined herein, terms defined in the Credit
Agreement and used herein shall have the meanings given to them in the Credit
Agreement.
In connection with this opinion, we have participated in various
conferences with representatives of Company and Agents
XIII-1
and conferences and telephone calls with White & Case and Xxxxxxxx & X'Xxxx,
LLP, counsel to Loan Parties, during which the Credit Agreement and related
matters have been discussed, and we have also participated in the meeting
held on the date hereof (the "Closing") incident to the funding of the
initial loans made under the Credit Agreement. Moreover, we have examined
the following documents:
(a) the forms of the Credit Agreement and the exhibits thereto,
including the forms of the promissory notes annexed thereto (the "Notes");
(b) the opinion letter of White & Case (the "W&C Opinion");
(c) the officers' certificates and other documents delivered at the
Closing.
In such examination, we have assumed the legal capacity of all natural
persons, the authenticity of all documents submitted to us as originals, the
conformity to original documents of all documents submitted to us as certified,
conformed or photostatic copies and the conformity of such documents to the
original documents.
Insofar as our opinion expressed below relates to the matters set
forth in the W&C Opinion, we have assumed without independent investigation the
correctness of the matters set forth therein, and our opinion is subject to the
assumptions, qualifications and limitations set forth in the W&C Opinion. We
have also assumed that the Credit Agreement and the Notes constitute valid and
legally binding obligations of the Agents and the Lenders.
Based upon the foregoing, and subject to the qualifications and
comments set forth below, we are of the opinion that, insofar as the law of the
State of New York is concerned, the Credit Agreement and the Notes constitute
valid and legally binding obligations of the Company, enforceable against the
Company in accordance with their terms.
Our opinion is subject to the following qualifications:
(d) Our opinion is subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
(e) We express no opinion as to any indemnification obligations of
the Company under the Credit Agreement to the extent such obligations might be
deemed to be inconsistent with public policy.
(f) We express no opinion as to the provisions of Section 10.4 of the
Credit Agreement purporting to grant a right
XIII-2
to setoff to participants.
(g) We express no opinion as to any provision of the Credit Agreement
that purports to establish an evidentiary standard for determinations by the
Lenders or the Agents.
We are members of the Bar of the State of New York, and we do not
express any opinion herein concerning any law other than the law of the State of
New York.
This opinion is rendered to you in connection with the above-described
transaction. This opinion may not be relied upon by you for any other purpose
or relied upon by any other person, firm or corporation without our prior
written consent.
Very truly yours,
XXXXXXX XXXXXXX & XXXXXXXX
XIII-3
EXHIBIT XIV
[FORM OF OPINION OF LOCAL COUNSEL]
July 1, 1998
The Chase Manhattan Bank,
as Administrative Agent
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
National Westminster Bank PLC,
as Syndication Agent
[ADDRESS]
UBS AG, Stamford Branch,
as Documentation Agent
[ADDRESS]
And each of the Lenders parties to the Third Amended
and Restated Credit Agreement referred to below
We have acted as special counsel in the State of ____________ (the "State")
to Aurora Foods Inc., a Delaware corporation (the "Borrower") in connection with
(a) the Third Amended and Restated Credit Agreement, dated as of July 1, 1998
(the "Credit Agreement"), among Borrower, the financial institutions from time
to time parties thereto (the "Lenders"), The Chase Manhattan Bank, as
Administrative Agent, National Westminster Bank PLC, as Syndication Agent and
UBS AG, Stamford Branch, as Documentation Agent and (b) the Third Amended and
Restated Security Agreement (the "Security Agreement") delivered pursuant to the
Credit Agreement.
The opinions expressed below are furnished to you pursuant to the Credit
Agreement. Unless otherwise defined herein, terms defined in the Credit
Agreement and used herein shall have the meanings ascribed to them in the Credit
Agreement.
In arriving at the opinions expressed below,
(a) we have examined and relied on the originals, or copies certified or
otherwise identified to our satisfaction, of each of (1) the Credit Agreement,
(2) the Security Agreement and (3) the mortgage listed on Schedule 1 (the "State
Mortgage");
(b) we have examined unfiled copies of financing statements (collectively,
the "Financing Statements") naming Borrower as Debtor and the Administrative
Agent as Secured Party and describing the Collateral (as defined in the Security
Agreement and the State Mortgage) as to which security interests may be
perfected by filing under the Uniform Commercial Code of the State (the "Filing
Collateral"), which we understand will be
XIV-1
filed in the filing offices listed on Schedule 2 (the "Filing Offices"); and
(c) we have examined such corporate documents and records of the Loan
Parties and such other instruments and certificates of public officials,
officers and representatives of the loan parties and other Persons, and we have
made such investigations of law, in each case as we have deemed appropriate as a
basis for such opinions.
In rendering the opinions expressed below, we have assumed, with your
permission, without independent investigation or inquiry, (a) the authenticity
of all documents submitted to us as originals, (b) the genuineness of all
signatures on all documents that we examined and (c) the conformity to authentic
originals of documents submitted to us as certified, conformed or photostatic
copies.
Based upon and subject to the foregoing, we are of the opinion that:
1. The execution and delivery by Borrower of the Security Agreement, the
performance by Borrower of its obligations thereunder and the creation and
perfection of any security interest upon or with respect to any of the
properties of Borrower provided for therein 1. do not and will not violate any
Requirement of Law of the State and 2. except for the filings described on
Schedule 2 to perfect the security interests created by the Security Agreement
with respect to the Filing Collateral and the recordings described on Schedule 1
attached hereto to perfect the liens created by the State Mortgage do not and
will not require any Governmental Authorization.
2. (a) The provisions of the Security Agreement create in favor of the
Agent a legal, valid and enforceable security interest in the Collateral.
(b) The Agent, upon filing of the Financing Statements in the Filing
Offices, will have a perfected security interest in the Filing Collateral.
3. The State Mortgage
(a) constitutes a legal, valid and binding obligation of Borrower
enforceable against Borrower in accordance with its terms;
(b) is in proper form for recording;
(c) complies as to form with all existing Requirements of Law;
(d) creates in favor of the Mortgagee (as defined in such State Mortgage)
a legal, valid and binding lien on the real property and fixtures described in
such State Mortgage, enforceable as such against Borrower and, when recorded in
the applicable office listed on Schedule 1, all other Persons; and
XIV-2
(e) when recorded in the applicable office listed on Schedule 1, will
constitute a perfected lien on the real property and fixtures described in such
State Mortgage.
The facts that (a) the State Mortgage secures the guaranty of obligations
arising under a term loan facility and a revolving line of credit and (b) the
Term Loans and Revolving Loans may from time to time be repaid in full or in
part and reborrowed in accordance with the terms of the Credit Agreement will
not result in a subordination of the liens of the State Mortgage to any other
lien on the real property and fixtures described in such State Mortgage or
otherwise impair the priority of the liens of such State Mortgage.
4. The courts of the State will enforce those provisions in the Security
Agreement and the State Mortgage which provide that the validity, construction
and enforceability of such documents will be governed by the laws of the State
of New York, except that the Courts of the State may apply the internal law of
the State to determine the perfection and effect of perfection of the liens
created under such documents and the application of remedies in enforcing such
liens with respect to property located in the State.
Our opinions set forth in paragraphs 2 and 3 above are subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.
We are members of the bar of the State and we express no opinion as to the
laws of any jurisdiction other than the laws of the State and the Federal laws
of the United States of America.
This opinion has been rendered solely for your benefit and for the benefit
of your Eligible Assignees pursuant to the Credit Agreement in connection with
the Credit Agreement and the transactions contemplated thereby and may not be
used, circulated, quoted, relied upon or otherwise referred to for any other
purpose without our prior written consent; provided, however, that this opinion
may be delivered to your regulators, accountants, attorneys and other
professional advisers and may be used in connection with any legal or regulatory
proceeding relating to the subject matter of this opinion.
Very truly yours,
XIV-3
Schedule 1
MORTGAGE RECORDINGS
IN THE STATE OF _______________
Description of Mortgage Recording Office
Mortgage dated as of July 1, 1998 Office of __________
County Clerk
from Aurora Foods Inc., as Mortgagor, to
The Chase Manhattan Bank, as Mortgagee
XIV-4
Schedule 2
FILING OFFICES
IN THE STATE OF ________________
1. Office of the Secretary of State of the State of ______________
2. Office of the _____________ County Clerk
XIV-5
EXHIBIT XV
[FORM OF ASSIGNMENT AGREEMENT]
ASSIGNMENT AGREEMENT
This ASSIGNMENT AGREEMENT (this "Agreement") is entered into by and
between the parties designated as Assignor ("Assignor") and Assignee
("Assignee") above the signatures of such parties on the Schedule of Terms
attached hereto and hereby made an integral part hereof (the "Schedule of
Terms") and relates to that certain Credit Agreement described in the Schedule
of Terms (said Credit Agreement, as amended, restated, supplemented or otherwise
modified to the date hereof and as it may hereafter be amended, restated,
supplemented or otherwise modified from time to time, being the "Credit
Agreement", the terms defined therein and not otherwise defined herein being
used herein as therein defined).
IN CONSIDERATION of the agreements, provisions and covenants herein
contained, the parties hereto hereby agree as follows:
SECTION 1. Assignment and Assumption.
(a) Effective upon the Settlement Date specified in Item 4 of the
Schedule of Terms (the "Settlement Date"), Assignor hereby sells and assigns to
Assignee, without recourse, representation or warranty (except as expressly set
forth herein), and Assignee hereby purchases and assumes from Assignor, that
percentage interest in all of Assignor's rights and obligations as a Lender
arising under the Credit Agreement and the other Loan Documents with respect to
Assignor's Commitments and outstanding Loans, if any, which represents, as of
the Settlement Date, the percentage interest specified in Item 3 of the Schedule
of Terms of all rights and obligations of Lenders arising under the Credit
Agreement and the other Loan Documents with respect to the Commitments and any
outstanding Loans (the "Assigned Share"). Without limiting the generality of
the foregoing, the parties hereto hereby expressly acknowledge and agree that
any assignment of all or any portion of Assignor's rights and obligations
relating to Assignor's Revolving Loan Commitment shall include (i) in the event
Assignor is an Issuing Lender with respect to any outstanding Letters of Credit
(any such Letters of Credit being "Assignor Letters of Credit"), the sale to
Assignee of a participation in the Assignor Letters of Credit and any drawings
thereunder as contemplated by subsection 3.1C of the Credit Agreement and (ii)
the sale to Assignee of a ratable portion of any participations previously
purchased by Assignor pursuant to said subsection 3.1C with respect to any
Letters of Credit other than the Assignor Letters of Credit.
(b) In consideration of the assignment described above, Assignee
hereby agrees to pay to Assignor, on the
XV-1
Settlement Date, the principal amount of any outstanding Loans included
within the Assigned Share, such payment to be made by wire transfer of
immediately available funds in accordance with the applicable payment
instructions set forth in Item 5 of the Schedule of Terms.
(c) Assignor hereby represents and warrants that Item 3 of the
Schedule of Terms correctly sets forth the amount of the Commitments, the
outstanding Term Loan and the Pro Rata Share corresponding to the Assigned
Share.
(d) Assignor and Assignee hereby agree that, upon giving effect to
the assignment and assumption described above, (i) Assignee shall be a party to
the Credit Agreement and shall have all of the rights and obligations under the
Loan Documents, and shall be deemed to have made all of the covenants and
agreements contained in the Loan Documents, arising out of or otherwise related
to the Assigned Share, and (ii) Assignor shall be absolutely released from any
of such obligations, covenants and agreements assumed or made by Assignee in
respect of the Assigned Share. Assignee hereby acknowledges and agrees that the
agreement set forth in this Section 1(d) is expressly made for the benefit of
Company, Agents, Assignor and the other Lenders and their respective successors
and permitted assigns.
(e) Assignor and Assignee hereby acknowledge and confirm their
understanding and intent that (i) this Agreement shall effect the assignment by
Assignor and the assumption by Assignee of Assignor's rights and obligations
with respect to the Assigned Share, (ii) any other assignments by Assignor of a
portion of its rights and obligations with respect to the Commitments and any
outstanding Loans shall have no effect on the Commitments, the outstanding
Tranche A Term Loan and the respective Pro Rata Shares corresponding to the
Assigned Shares as set forth in Item 3 of the Schedule of Terms or on the
interest of Assignee in any outstanding Revolving Loans corresponding thereto,
and (iii) from and after the Settlement Date, Administrative Agent shall make
all payments under the Credit Agreement in respect of the Assigned Share
(including without limitation all payments of principal and accrued but unpaid
interest, commitment fees and letter of credit fees with respect thereto) (1) in
the case of any such interest and fees that shall have accrued prior to the
Settlement Date, to Assignor, and (2) in all other cases, to Assignee; provided
that Assignor and Assignee shall make payments directly to each other to the
extent necessary to effect any appropriate adjustments in any amounts
distributed to Assignor and/or Assignee by Administrative Agent under the Loan
Documents in respect of the Assigned Share in the event that, for any reason
whatsoever, the payment of consideration contemplated by Section 1(b) occurs on
a date other than the Settlement Date.
XV-2
SECTION 2. Certain Representations, Warranties and Agreements.
---------------------------------------------------
(a) Assignor represents and warrants that it is the legal and
beneficial owner of the Assigned Share, free and clear of any adverse claim.
(b) Assignor shall not be responsible to Assignee for the execution,
effectiveness, genuineness, validity, enforceability, collectibility or
sufficiency of any of the Loan Documents or for any representations, warranties,
recitals or statements made therein or made in any written or oral statements or
in any financial or other statements, instruments, reports or certificates or
any other documents furnished or made by Assignor to Assignee or by or on behalf
of Company or of any other Loan Party to Assignor or Assignee in connection with
the Loan Documents and the transactions contemplated thereby or for the
financial condition or business affairs of Company or any other Person
liable for the payment of any Obligations, nor shall Assignor be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions,
covenants or agreements contained in any of the Loan Documents or as to the use
of the proceeds of the Loans or the use of the Letters of Credit or as to the
existence or possible existence of any Event of Default or Potential Event of
Default.
(c) Assignee represents and warrants that it is an Eligible Assignee;
that it has experience and expertise in the making or purchasing of loans such
as the Loans; that it has acquired the Assigned Share for its own account in the
ordinary course of its business and without a view to distribution of the Loans
within the meaning of the Securities Act or the Exchange Act or other federal
securities laws (it being understood that, subject to the provisions of
subsection 10.1 of the Credit Agreement, the disposition of the Assigned Share
or any interests therein shall at all times remain within its exclusive
control); and that it has received, reviewed and approved a copy of the Credit
Agreement (including all Exhibits and Schedules thereto).
(d) Assignee represents and warrants that it has received from
Assignor such financial information regarding Company and its Subsidiaries as is
available to Assignor and as Assignee has requested, that it has made its own
independent investigation of the financial condition and affairs of Company and
its Subsidiaries in connection with the assignment evidenced by this Agreement,
and that it has made and shall continue to make its own appraisal of the
creditworthiness of Company and its Subsidiaries. Assignor shall have no duty
or responsibility, either initially or on a continuing basis, to make any such
investigation or any such appraisal on behalf of Assignee or to provide Assignee
with any other credit or other information with respect thereto, whether coming
into its possession before the making of the initial Loans or at any time or
times thereafter, and Assignor shall not have any responsibility with respect to
the accuracy of or the completeness of any information provided to Assignee.
XV-3
(e) Each party to this Agreement represents and warrants to the other
party hereto that it has full power and authority to enter into this Agreement
and to perform its obligations hereunder in accordance with the provisions
hereof, that this Agreement has been duly authorized, executed and delivered by
such party and that this Agreement constitutes a legal, valid and binding
obligation of such party, enforceable against such party in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally and by general principles of equity.
SECTION 3. Miscellaneous.
--------------
(a) Each of Assignor and Assignee hereby agrees from time to time,
upon request of the other such party hereto, to take such additional actions and
to execute and deliver such additional documents and instruments as such other
party may reasonably request to effect the transactions contemplated by, and to
carry out the intent of, this Agreement.
(b) Neither this Agreement nor any term hereof may be changed,
waived, discharged or terminated, except by an instrument in writing signed by
the party (including, if applicable, any party required to evidence its consent
to or acceptance of this Agreement) against whom enforcement of such change,
waiver, discharge or termination is sought.
(c) Unless otherwise specifically provided herein, any notice or
other communication herein required or permitted to be given shall be in writing
and may be personally served, telexed or sent by telefacsimile or United States
mail or courier service and shall be deemed to have been given when delivered in
person or by courier service, upon receipt of telefacsimile or telex, or three
Business Days after depositing it in the United States mail with postage prepaid
and properly addressed. For the purposes hereof, the notice address of each of
Assignor and Assignee shall be as set forth on the Schedule of Terms or, as to
either such party, such other address as shall be designated by such party in a
written notice delivered to the other such party. In addition, the notice
address of Assignee set forth on the Schedule of Terms shall serve as the
initial notice address of Assignee for purposes of subsection 10.8 of the Credit
Agreement.
(d) In case any provision in or obligation under this Agreement shall
be invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.
(e) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF
XV-4
THE STATE OF NEW YORK (INCLUDING WITHOUT LIMITATION SECTION 5~1401 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES.
(f) This Agreement shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective successors and assigns.
(g) This Agreement may be executed in one or more counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document.
(h) This Agreement shall become effective upon the date (the
"Assignment Effective Date") upon which all of the following conditions are
satisfied: (i) the execution of a counterpart hereof by each of Assignor and
Assignee, (ii) the giving of notice to Company, (iii) the receipt by
Administrative Agent of the processing and recordation fee referred to in
subsection 10.1B(i) of the Credit Agreement, (iv) in the event Assignee is a
Non-US Lender (as defined in subsection 2.7B(iii)(a) of the Credit Agreement),
the delivery by Assignee to Administrative Agent of such forms, certificates or
other evidence with respect to United States federal income tax withholding
matters as Assignee may be required to deliver to Administrative Agent pursuant
to said subsection 2.7B(iii)(a), (v) the execution of a counterpart hereof by
Administrative Agent as evidence of its consent hereto to the extent required
under subsection 10.1B(i) of the Credit Agreement and by Administrative Agent as
evidence of its acceptance hereof in accordance with subsection 10.1B(ii) of the
Credit Agreement, (vi) the receipt by Administrative Agent of originals or
telefacsimiles of the counterparts described above and authorization of delivery
thereof, and (vii) the recordation by Administrative Agent in the Register of
the pertinent information regarding the assignment effected hereby in accordance
with subsection 10.1B(ii) of the Credit Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered by their respective officers hereunto duly
authorized, such execution being made as of the Effective Date in the applicable
spaces provided on the Schedule of Terms.
XV-5
SCHEDULE OF TERMS
1. Company: AURORA FOODS INC., a Delaware corporation
2. Name and Date of Credit Agreement: Third Amended and Restated Credit
Agreement dated as of July 1, 1998, by and among Company, the financial
institutions listed therein as Lenders, The Chase Manhattan Bank, as
Administrative Agent, National Westminster Bank PLC, as Syndication Agent,
and UBS AG, Stamford Branch, as Documentation Agent.
3. Amounts:
-------- Re: Tranche A Re: Revolving
Term Loans Loans
(a) Aggregate $ $
Commitments ------------- ------------
of all Lenders:
-------------% ------------%
(b) Assigned $ $
Share/Pro ------------- ------------
Rata Share:
(c) Amount of $ $
Assigned ------------- ------------
Share of
Commitments:
(d) Amount of $ $
Assigned ------------- ------------
Share:
4. Settlement Date: , [199_][200_]
---------------- -------------------
5. Payment Instructions:
---------------------
ASSIGNOR: ASSIGNEE:
See Annex A See Annex B
6. Notice Addresses:
-----------------
ASSIGNOR: ASSIGNEE:
See Annex A See Annex B
7. Signatures:
----------
[NAME OF ASSIGNOR], [NAME OF ASSIGNEE],
as Assignor as Assignee
By: By:
----------------- ----------------
Name: Name:
Title: Title:
Consented to and accepted in
accordance with subsections 10.1B(i)
and (ii) of the Credit Agreement
THE CHASE MANHATTAN BANK,
as Administrative Agent
XV-6
By:
---------------
Name:
Title:
XV-7
ANNEX A
Assignor Payment Instructions:
------------------------------
-------------------------
-------------------------
-------------------------
Attention:
---------------
Reference:
---------------
Assignor Notice Addresses:
--------------------------
-------------------------
-------------------------
-------------------------
Attention:
---------------
Reference:
---------------
XV-8
ANNEX B
Assignee Payment Instructions:
-----------------------------
-------------------------
-------------------------
-------------------------
Attention:
---------------
Reference:
---------------
Assignee Notice Addresses:
--------------------------
-------------------------
-------------------------
-------------------------
Attention:
---------------
Reference:
---------------
XV-9
EXHIBIT XVI
[FORM OF PERMITTED SELLER NOTE]
___% NON-NEGOTIABLE SUBORDINATED NOTE
[Insert Date] $__________
AURORA FOODS INC., a Delaware corporation (the "Borrower"), hereby
promises upon the terms and subject to the provisions hereof to pay to [NAME OF
SELLER] (the "Holder"), the principal amount of [__________] Dollars
($_________).
This _____% Non-Negotiable Junior Subordinated Note (the "Note") was
issued pursuant to the Purchase Agreement (the "Purchase Agreement") dated as of
[__________, [199_] [200_], between the Borrower and the Holder.
1. Definitions. As used herein, the following terms shall have the
following meanings:
"Indebtedness" means (i) all obligations for borrowed money or for the
deferred purchase price of property or services (including, without limitation,
all obligations contingent or otherwise in connection with acceptance, letter of
credit or similar facilities, (ii) all obligations evidenced by bonds, notes,
debentures or other similar instruments or securities, (iii) all indebtedness
created or arising under any sale and leaseback arrangement, conditional sale or
other title retention agreement with respect to property owned or acquired
(whether or not the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of such
property), (iv) all rental obligations under capital leases to the extent not
included in clause (iii) above, (v) all guarantees (direct or indirect), all
contingent reimbursement obligations under undrawn letters of credit and all
other contingent obligations in respect of, or obligations to purchase or
otherwise acquire or to assure payment of, indebtedness of others and (vi)
indebtedness of others secured by any lien upon property, whether or not
assumed, but only to the extent of such property's fair market value.
"Person" means an individual, a partnership, a corporation, an
association, a limited liability company, a joint stock company, a trust, a
joint venture, an unincorporated organization and a governmental entity or any
department, agency or political subdivision thereof
"Senior Agent" shall mean The Chase Manhattan Bank, as Administrative
Agent for the Lenders under the Senior Credit Agreement, and its successors in
such capacity, or if there is then no acting Administrative Agent under the
Senior Credit Agreement, financial institutions holding a majority in principal
XVI-1
amount of the Senior Debt outstanding thereunder.
"Senior Credit Agreement" shall mean the Third Amended and Restated
Credit Agreement, dated as of July 1, 1998, by and among the Borrower, the
financial institutions listed therein as Lenders, The Chase Manhattan Bank, as
Administrative Agent, National Westminster Bank PLC, as Syndication Agent, and
UBS AG, Stamford Branch, as Documentation Agent, as amended, restated, modified
or supplemented from time to time hereafter, together with any credit agreement
or similar document from time to time executed by the Borrower to evidence any
Refinancing (as defined in the definition of Senior Indebtedness) or successive
Refinancings.
"Senior Indebtedness" shall mean (i) all Obligations (as defined in
the Senior Credit Agreement) (including Contingent Obligations, as defined in
the Senior Credit Agreement) now or hereafter incurred pursuant to and in
accordance with the terms of the Senior Debt Documents, (ii) any additional
Indebtedness incurred under or pursuant to the Senior Credit Agreement and the
other Senior Debt Documents whether such Obligations or additional Indebtedness
involve principal prepayment charges, interest (including, without limitation,
interest accruing after the filing of a petition initiating any proceeding under
the Bankruptcy Code, whether or not allowed as a claim in such proceeding)
indemnities or reimbursement of fees, expenses or other amounts, and (iii) any
indebtedness incurred for the purpose of refinancing, restructuring, extending
or renewing (collectively, "Refinancing") the obligations of the Borrower under
the Senior Credit Agreement as set forth in clauses (i) and (ii) above.
"Senior Debt Documents" shall mean the Senior Credit Agreement and all
other documents and instruments delivered or filed in connection with the
creation or incurrence of any Senior Indebtedness (including, without
limitation, the guaranty agreements executed and delivered by the subsidiaries
of the Borrower in respect of the Obligations under the Senior Credit
Agreement).
"Senior Lenders" shall mean the financial institutions party to the
Senior Credit Agreement as "Lenders" from time to time.
2. Payment of Interest. Interest shall accrue on the unpaid
principal amount of this Note from the date hereof at the rate of [_____]% per
annum [NOT TO EXCEED 12%] (the "Interest Rate"), calculated on the basis of a
365 day year: The Borrower shall pay interest semi-annually in arrears on the
fifteenth day of January and July in each year (each, an "Interest Payment
Date") commencing on ___________, [199_] [200_].
XVI-2
3. Payment of Principal.
(a) Scheduled Payment. Subject to the provisions of Section 4
hereof, on [__________], [199_][200_] (the "Maturity Date"), the Borrower shall
pay to the holder of this Note the entire principal amount of this Note, plus
all accrued and unpaid interest hereon which is then unpaid.
(b) Optional Prepayments. Subject to the provisions of Section 4
hereof, the Borrower may, at any time and from time to time, without premium or
penalty, prepay all or a portion of the unpaid principal amount of this Note,
together with unpaid interest accrued since the preceding Interest Payment Date
to which interest has been paid on such portion of the principal amount which it
is prepaying; provided, that no such prepayment shall be made if such prepayment
is then prohibited by the terms of any Senior Indebtedness. A prepayment of
less than all of the unpaid principal amount of this Note shall not relieve the
Borrower of its obligation to make the scheduled payment on this Note on the
Maturity Date. Each partial payment under this Note shall first be credited to
accrued and unpaid interest on the principal being prepaid, and the remainder
shall be credited to principal. Whenever any payment to be made hereunder shall
be due on a date which is not a business day, the payment shall be made on the
next succeeding business day and such extension of time shall be included in the
computation of interest with respect to such payment.
4. Subordination.
(a) Agreement to Subordinate. The Borrower and, by its acceptance
hereof, each Holder agree that the indebtedness of the Borrower evidenced by
this Note, whether for principal, interest on any other amount payable under or
in respect hereof and all rights or claims arising out of or associated with
such Indebtedness (the "Subordinated Obligations"), shall be junior and
subordinate in right of payment to the prior payment in full in cash of all
Senior Indebtedness, in accordance with the provisions of this Section 4. Each
holder of Senior Indebtedness shall be deemed to have acquired Senior
Indebtedness in reliance upon the agreements of the Borrower and the holder of
this Note contained in this Section 4. The provisions of this Section 4 shall
be reinstated if at any time any payment of any of the Senior Indebtedness is
rescinded or must otherwise be returned by any holder of Senior Indebtedness or
any representative of such holder upon the insolvency, bankruptcy or
reorganization of the Borrower. Any provision of this Note to the contrary
notwithstanding (other than the provision contained in Section 6), the Borrower
shall not make, and no Holder shall accept, any payment or prepayment of
principal, or prepayment of other amounts due thereunder, of any kind whatsoever
(including without limitation by distribution of assets, set off, exchange or
any other manner) with respect to the Subordinated Obligations at any time when
any of the Senior Indebtedness remains outstanding. Holder may receive interest
payments in respect of the Subordinated Obligations in accordance with the terms
of this
XVI-3
Note except to the extent and at the times prohibited or restricted by
the provisions of this Section 4. In no event shall the Holder commence any
action or proceeding to contest the provisions of this Section 4 or the priority
of the Liens (as defined in the Senior Credit Agreement) granted to the holders
of the Senior Indebtedness by the Borrower. No Holder shall take, accept or
receive any collateral security from the Borrower for the payment of the
Subordinated Obligations.
(b) Liquidation, Dissolution, Bankruptcy. In the event of any
insolvency, bankruptcy, dissolution, winding up, liquidation, arrangement,
reorganization, marshalling of assets or liabilities, composition, assignment
for the benefit of creditors or other similar proceedings relating to the
Borrower, its debts, its property or its operations, whether voluntary or
involuntary, including, without limitation the filing of any petition or the
taking of any action to commence any of the foregoing (which, in the case of
action by a third party, is not dismissed within 60 days) (a "Bankruptcy
Event"), all Senior Indebtedness shall first be paid in full in cash or other
immediately available funds before Holder shall be entitled to receive or retain
any payment or distribution of assets of the Borrower with respect to any
Subordinated Obligations. In the event of any such Bankruptcy Event, any
payment or distribution of assets to which Holder would be entitled if the
Subordinated Obligations were not subordinated to the Senior Indebtedness in
accordance with this Section 4, whether in cash, property, securities or
otherwise, shall be paid or delivered by the debtor, custodian, trustee or agent
or other Person making such payment or distribution, or by the Holder if
received by it, directly to the Senior Agent on behalf of the holders of the
Senior Indebtedness for application to the payment of the Senior Indebtedness
remaining unpaid, to the extent necessary to make payment in full in cash or
other immediately available funds of all Senior Indebtedness remaining unpaid,
after giving effect to any concurrent payment or distribution to or for the
holders of the Senior Indebtedness.
(c) No Payments with Respect to Subordinated Obligations in Certain
Circumstances.
(i) In circumstances in which Section 4(b) is not applicable, no
payment of any nature (including, without limitation, any distribution of
assets) in respect of the Subordinated Obligations (including, without
limitation, pursuant to any judgment with respect thereto or on account of the
purchase or redemption or other acquisition of Subordinated Obligations, by set
off, prepayment exchange or other manner) shall be made by or on behalf of the
Borrower if, at the time of such payment:
(A) a default in the payment when due (whether at the maturity
thereof, or upon acceleration of maturity or otherwise and without giving
effect to any applicable grace periods) of all or any portion of the Senior
Indebtedness (whether of principal, interest or any other amount with
respect thereto) shall have occurred, and such default shall
XVI-4
not have been cured or waived in accordance with the terms of the Senior
Debt Documents; or
(B) subject to the last sentence of this Section 4(c), (x) the
Borrower shall have received notice from the Senior Agent of the occurrence
of one or more Events of Default (as defined in the Senior Credit
Agreement) in respect of the Senior Indebtedness (other than payment
defaults described in Section 4(c)(i)(A) above), (y) each such Event of
Default shall not have been cured or waived in accordance with the terms of
the Senior Debt Documents, and (z) 180 days shall not have elapsed since
the date such notice was received.
The Borrower may resume payments (and may make any payments missed due
to the application of Section 4(c)(i) in respect of the Subordinated Obligations
or any judgment with respect thereto:
(A) in the case of a default referred to in clause (A) of this
Section 4(c)(i), upon a cure or waiver thereof in accordance with the terms
of the Senior Debt Documents; or
(B) in the case of an Event of Default or Events of Default referred
to in clause (B) of this Section 4(c)(i), upon the earlier to occur of (1)
the cure or waiver of all such Events of Default in accordance with the
terms of the Senior Debt Documents, or (2) the expiration of such period of
180 days.
(ii) Following any acceleration of the maturity of any Senior
Indebtedness and as long as such acceleration shall continue unrescinded and
unannulled, such Senior Indebtedness shall first be paid in full in cash, or
provision for such payment shall be made in a manner satisfactory to the holders
of the Senior Indebtedness, before any payment is made on account of or applied
on the Subordinated Obligations.
(iii) The Borrower shall give prompt written notice to the Holder of
(A) any default in respect of Senior Obligations referred to in Section
4(c)(i)(A) and (B) any notice of the type described in Section 4(c)(i)(B) from
the Senior Agent.
(d) When Distribution Must Be Paid Over. In the event that Holder
shall receive any payment or distribution of assets that Holder is not entitled
to receive or retain under the provisions of this Note, Holder shall hold any
amount so received in trust for the holders of Senior Indebtedness, shall
segregate such assets from other assets held by Holder and shall forthwith turn
over such payment or distribution (without liability for interest thereon) to
the Senior Agent on behalf of the holders of Senior Indebtedness in the form
received (with any necessary endorsement) to be applied to Senior Indebtedness.
(e) Exercise of Remedies. So long as any Senior Indebtedness is
outstanding (including any loans, any letters of credit, any commitments to lend
or any lender guarantees), Holder (solely in its capacity as a holder of this
Note) shall not
XVI-5
exercise any rights or remedies with respect to an Event of Default under
this Note, including, without limitation, any action (l) to demand or xxx for
collection of amounts payable hereunder, (2) to accelerate the principal of
this Note, or (3) to commence or join with any other creditor (other than the
holder of a majority in principal amount of the Senior Indebtedness) in
commencing any proceeding in connection with or premised on the occurrence of
a Bankruptcy Event prior to the earlier of:
(A) the payment in full in cash or other immediately available funds
of all Senior Indebtedness;
(B) the initiation of a proceeding (other than a proceeding
prohibited by clause (3) of this Section 4(e)) in connection with or
premised upon the occurrence of a Bankruptcy Event;
(C) the expiration of 180 days immediately following the receipt by
the Senior Agent of notice of the occurrence of such Event of Default from
the Holder; and
(D) the acceleration of the maturity of the Senior Indebtedness;
provided, however, that if, with respect to (B) and (D) above, such proceeding
or acceleration, respectively, is rescinded, or with respect to (C) above,
during such 180-day period such Event of Default has been cured or waived, the
prohibition against taking the actions described in this section 4(e) shall
automatically be reinstated as of the date of the rescission, cure or waiver, as
applicable. In all events, unless an event described in clause (A), (B) or (D)
above has occurred and not been rescinded, the Holder shall give thirty (30)
days prior written notice to the Senior Agent before taking any action described
in this Section 4(e), which notice shall describe with specificity the action
that the Holder in good faith intends to take.
(f) Acceleration of Payment of Note. If this Note is declared due
and payable prior to the Maturity Date, no direct or indirect payment that is
due solely by reason of such declaration shall be made, nor shall application be
made of any distribution of assets of the Borrower (whether by set off or in any
other manner, including, without limitation, from or by way of collateral) to
the payment, purchase or other acquisition or retirement of this Note, unless,
in either case, (i) all amounts due or to become due on or in respect of the
Senior Indebtedness (including with respect to any outstanding letters of
credit) shall have been previously paid in full in cash or other immediately
available funds or in any other manner satisfactory to all holders of such
Senior Indebtedness, (ii) all commitments to lend under Senior Indebtedness
shall have been terminated, (iii) all guarantees constituting Senior
Indebtedness shall have been terminated and (iv) all lender guarantees
constituting Senior Indebtedness shall have been permanently reduced to zero.
(g) Proceedings Against Borrower. So long as any
XVI-6
Senior Indebtedness is outstanding (including any loans, any commitments to
lend or open lender guarantees or any lender guarantees, Holder (solely in
its capacity as a holder of this Note) shall not commence any bankruptcy,
insolvency, reorganization or other similar proceeding against Borrower.
(h) Amending Senior Indebtedness. Any holder of Senior Indebtedness
may, at any time and from time to time, without the consent of or notice to
Holder (i) modify or amend the terms of the Senior Indebtedness provided that
such Senior Indebtedness cannot be extended or renewed past June 30, 2005, (ii)
sell, exchange, release, fail to perfect a lien on or a security interest in or
otherwise in any manner deal with or apply any property pledged or mortgaged to
secure, or otherwise securing, Senior Indebtedness, (iii) release any guarantor
or any other person liable in any manner for the Senior Indebtedness, (iv)
exercise or refrain from exercising any rights against Borrower or any other
person, (v) apply any sums by whomever paid or however realized to Senior
Indebtedness or (vi) take any other action that might be deemed to impair in any
way the rights of the holder of this Note. Any and all of such actions may be
taken by the holders of Senior Indebtedness without incurring responsibility to
Holder and without impairing or releasing the obligations of Holder to the
holders of Senior Indebtedness.
(i) Certain Rights in Bankruptcy. Holder hereby irrevocably
authorizes and empowers each holder of Senior Indebtedness (and its
representative or representatives) to demand, xxx for, collect and receive all
payments and distributions under the terms of this Note, to file and prove all
claims (including claims in bankruptcy) relating to this Note, to exercise any
right to vote arising with respect to this Note and any claims hereunder in any
bankruptcy, insolvency or similar proceeding and take any and all other actions
in the name of Holder (solely in its capacity as a holder of this Note), as such
holder of Senior Indebtedness determines to be necessary or appropriate.
(j) Subrogation. No payment or distribution to any holder of Senior
Indebtedness pursuant to the provisions of this Note shall entitle Holder to
exercise any right of subrogation in respect thereof until (i)(w) all Senior
Indebtedness shall have been paid in full in cash or other immediately available
funds or in any other manner satisfactory to all holders of Senior Indebtedness,
(x) all commitments to lend under Senior Indebtedness shall have been
terminated, (y) all guarantees constituting Senior Indebtedness shall have been
terminated and (z) all lender guarantees constituting Senior Indebtedness shall
have been permanently reduced to zero or (ii) all holders of Senior Indebtedness
have consented in writing to the taking of such action.
(k) Relative Rights. The provisions of this Section 4 are for the
benefit of the holders of Senior Indebtedness (and their successors and assigns)
and shall be enforceable by them directly against Holder. Holder acknowledges
and agrees that any breach of the provisions of this Section 4 will cause
irreparable
XVI-7
harm for which the payment of monetary damages may be inadequate. For this
reason, Holder agrees that, in addition to any remedies at law or equity to
which a holder of the Senior Indebtedness may be entitled, a holder of the
Senior Indebtedness will be entitled to an injunction or other equitable
relief to prevent breaches of the provisions of this Section 4 and/or to
compel specific performance of such provisions. The provisions of this
Section 4 shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of Senior Indebtedness is rescinded or must
otherwise be returned by any holder of Senior Indebtedness upon the
occurrence of a Bankruptcy Event or otherwise, all as though such payment had
not been made. The provisions of this Section 4 are not intended to impair
and shall not impair as between Borrower and Holder, the obligation of
Borrower, which is absolute and unconditional, to pay Holder all amounts
owing under this Note.
(l) Reliance on Orders and Decrees. Subject to the provisions of
Section 4(d) hereof, upon any payment or distribution of assets of Borrower,
whether in cash, property, securities or otherwise, Holder shall be entitled to
rely upon any order or decree entered by any court of competent jurisdiction in
which any insolvency, bankruptcy, receivership, liquidation, reorganization,
dissolution, winding up or similar case or proceeding is pending, or a
certificate of the trustee in bankruptcy, receiver, liquidating trustee,
custodian, assignee for the benefit of creditors, agent or other Person making
such payment or distribution, delivered to Holder for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of Senior Indebtedness, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all other facts
pertinent thereto or to this Section 4.
5. Events of Default.
(a) Definition. The following shall be an "Event of Default" under
this Note;
(i) the Borrower shall fail to make any payment of interest on this
Note when the same shall become due and payable and such failure shall
continue for a period of 5 days;
(ii) the Borrower shall fail to make any payment of the principal of
this Note when the same shall become due and payable, whether on the
Maturity Date or otherwise;
(iii) (A) the Borrower shall commence any case, proceeding or action
(x) under any existing or future law of any jurisdiction, domestic or
foreign, relating to bankruptcy, insolvency, reorganization or relief of
debtors, seeking to have an order for relief entered with respect to it, or
seeking to adjudicate it a bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to its debts, or (y)
seeking appointment of a
XVI-8
receiver, trustee, custodian or other similar official for it or for all
or any substantial part of its assets, (B) the Borrower shall make a
general assignment for the benefit of its creditors, (C) there shall be
commenced against the Borrower any case, proceeding or other action of a
nature referred to in clause (A) above which shall not have been vacated
or discharged within 60 days from the commencement thereof, or (D) a court
shall enter a decree or order for relief in any involuntary case under
Title 11 of the United States Code, as amended from time to time, or any
applicable bankruptcy or similar law now or hereafter in effect, which
decree or order is not stayed, vacated, discharged, or bonded pending
appeal within 60 days from the entry thereof; or
(iv) the acceleration of the maturity of the Senior Indebtedness.
(b) Remedies. If an Event of Default shall occur and be continuing,
then, subject to the provisions of Section 4, the Holder may, upon written
notice to the Borrower, declare all amounts owing under this Note to be
immediately due and payable.
Subject to the immediately preceding paragraph and to Section 4 above,
the Holder shall also have all other rights in respect of this Note following
the occurrence and during the continuance of an Event of Default which are
available pursuant to applicable law or in equity.
[6. Right of Set-Off. Anything in this Note to the contrary
notwithstanding, nothing in this Note shall preclude the Borrower from timely
exercising such Borrower's right pursuant to Section _____ of the Purchase
Agreement to set-off indemnification claims against this Note and/or interest
payments under this Note.]
7. No Presentment. The Borrower, for itself and any guarantors
hereof, and their successors and assigns, waives presentment, demand, protest
and notice thereof or of dishonor, and waives any right to be released by reason
of any extension of time or change in the terms of payment.
8. Amendment. So long as any Senior Indebtedness is outstanding
(including any commitment under the Senior Agent Documents) the terms of this
Note may be amended only with the consent of the Senior Agent. Subject to the
foregoing, without the consent of the Senior Agent hereof, this Note may be
amended by the Borrower and the Holder to cure any ambiguity, defect or
inconsistency that does not affect the subordination provisions hereof or the
rights of the Senior Lenders.
9. Cancellation. After all unpaid principal and interest owed on
this Note has been paid in full, this Note shall be surrendered to the Borrower
for cancellation and shall not be reissued.
10. Transfer Restrictions: Acknowledgment of Security
XVI-9
Interest. This Note shall not be transferrable by the Holder hereof without
the prior written consent of the Borrower (which consent shall not be
unreasonably withheld). The Holder hereby acknowledges, and agrees to, the
Borrower's grant of its interest herein to the Lenders under the Credit
Agreement, dated as of the date hereof, to collaterally secure the Borrower's
obligations under such Credit Agreement.
11. Payment of Expenses. The Borrower agrees to pay all costs and
expenses (including reasonable attorneys' fees) reasonably incurred by the
Holder after the occurrence and during the continuance of an Event of Default in
enforcing any obligations under this Note or in collecting any payments due from
Borrower under this Note (including in connection with a bankruptcy or
insolvency proceeding with respect to the Borrower).
12. Governing Law. The construction, validity and interpretation of
this Note shall be governed by and construed in accordance with the domestic
laws of the State of New York, without giving effect to any choice of law or
conflict of law provision or rule (whether of the State of New York or any other
jurisdiction) that would cause the application of the laws of any jurisdiction
other than the State of New York.
13. Descriptive Headings. The descriptive headings of this Note are
inserted for convenience only, and do not constitute a part of this Note.
XVI-10
IN WITNESS WHEREOF, the Borrower has executed and delivered this Note
on the date first written above.
AURORA FOODS INC.
By: ________________________
Name:
Title:
Agreed:
[NAME OF SELLER]
By: __________________________
Name:
Title:
XVI-11
EXHIBIT XVII
[FORM OF CERTIFICATE RE NON-BANK STATUS]
CERTIFICATE RE NON-BANK STATUS
Reference is hereby made to that certain Third Amended and Restated
Credit Agreement dated as of July 1, 1998 (said Third Amended and Restated
Credit Agreement, as amended, restated, supplemented or otherwise modified to
the date hereof, being the "Credit Agreement"), by and among Aurora Foods Inc.,
a Delaware corporation, the financial institutions listed therein as Lenders
("Lenders"), The Chase Manhattan Bank, as Administrative Agent, National
Westminster Bank PLC, as Syndication Agent, and UBS AG, Stamford Branch, as
Documentation Agent. Pursuant to subsection 2.7B(iii) of the Credit Agreement,
the undersigned hereby certifies that it is not a "bank" or other Person
described in Section 881(c)(3) of the Internal Revenue Code of 1986, as amended.
[NAME OF LENDER]
By: ________________________
Name:
Title:
XVII-1
EXHIBIT XVIII
[FORM OF COLLATERAL ACCOUNT AGREEMENT]
COLLATERAL ACCOUNT AGREEMENT
This COLLATERAL ACCOUNT AGREEMENT (this "Agreement") is dated as of
July 1, 1998 and entered into by and between AURORA FOODS INC., a Delaware
corporation ("Pledgor"), and THE CHASE MANHATTAN BANK, as administrative agent
for and representative of (in such capacity herein called "Secured Party") the
financial institutions ("Lenders") party to the Third Amended and Restated
Credit Agreement referred to below.
PRELIMINARY STATEMENTS
A. Pursuant to that certain Third Amended and Restated Credit
Agreement dated as of July 1, 1998 (said Third Amended and Restated Credit
Agreement, as it may hereafter be amended, restated, supplemented or otherwise
modified from time to time, being the "Credit Agreement", the terms defined
therein and not otherwise defined herein being used herein as therein defined),
by and among Pledgor, Lenders, Secured Party, as Administrative Agent, National
Westminster Bank PLC, as Syndication Agent, and UBS AG, Stamford Branch, as
Documentation Agent, Lenders have made certain commitments, subject to the terms
and conditions set forth in the Credit Agreement, to extend certain credit
facilities to Pledgor.
B. It is a condition precedent to the initial extensions of credit
by Lenders under the Credit Agreement that Pledgor shall have granted the
security interests and undertaken the obligations contemplated by this
Agreement.
NOW, THEREFORE, in consideration of the premises and in order to
induce Lenders to make Loans and issue Letters of Credit under the Credit
Agreement and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Pledgor hereby agrees with Secured
Party as follows:
SECTION 1. Certain Definitions.
The following terms used in this Agreement shall have the following
meanings:
"Collateral" means (i) the Collateral Account, (ii) all amounts on
deposit from time to time in the Collateral Account, (iii) all interest, cash,
instruments, securities and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or all
of the Collateral, and (iv) to the extent not covered by clauses (i) through
(iii) above, all proceeds of any or all of the foregoing Collateral.
XVIII-1
"Collateral Account" means the restricted deposit account established
and maintained by Secured Party pursuant to subsection 2(a).
"Secured Obligations" means all obligations and liabilities of every
nature of Pledgor now or hereafter existing under or arising out of or in
connection with the Credit Agreement and the other Loan Documents and all
extensions or renewals thereof, whether for principal, interest (including
without limitation interest that, but for the filing of a petition in bankruptcy
with respect to Pledgor, would accrue on such obligations), reimbursement of
amounts drawn under Letters of Credit, fees, expenses, indemnities or otherwise,
whether voluntary or involuntary, direct or indirect, absolute or contingent,
liquidated or unliquidated, whether or not jointly owed with others, and whether
or not from time to time decreased or extinguished and later increased, created
or incurred, and all or any portion of such obligations or liabilities that are
paid, to the extent all or any part of such payment is avoided or recovered
directly or indirectly from Secured Party or any Lender as a preference,
fraudulent transfer or otherwise, and all obligations of every nature of Pledgor
now or hereafter existing under this Agreement.
SECTION 2. Establishment and Operation of Collateral Account.
(a) Secured Party is hereby authorized to establish and maintain at
its office at ________________________________, as a blocked account in the name
of Secured Party and under the sole dominion and control of Secured Party, a
restricted deposit account designated as "Aurora Foods Inc. Collateral Account".
(b) The Collateral Account shall be operated in accordance with the
terms of this Agreement.
(c) All amounts at any time held in the Collateral Account shall be
beneficially owned by Pledgor but shall be held in the name of Secured Party
hereunder, for the benefit of Lenders, as collateral security for the Secured
Obligations upon the terms and conditions set forth herein. Pledgor shall have
no right to withdraw, transfer or, except as expressly set forth herein,
otherwise receive any funds deposited into the Collateral Account.
(d) Anything contained herein to the contrary notwithstanding, the
Collateral Account shall be subject to such applicable laws, and such applicable
regulations of the Board of Governors of the Federal Reserve System and of any
other appropriate banking or governmental authority, as may now or hereafter be
in effect.
SECTION 3. Deposits of Cash Collateral.
(a) All deposits of funds in the Collateral Account shall be made by
wire transfer (or, if applicable, by intra-bank transfer from another account of
Pledgor) of immediately available funds, in each case addressed as follows:
XVIII-2
Account No.:
ABA No.:
Reference:
Attention:
Pledgor shall, promptly after initiating a transfer of funds to the Collateral
Account, give notice to Secured Party by telefacsimile of the date, amount and
method of delivery of such deposit.
(b) If an Event of Default has occurred and is continuing and, in
accordance with Section 8 of the Credit Agreement, Pledgor is required to pay to
Secured Party an amount equal to the maximum amount that may at any time be
drawn under all Letters of Credit then outstanding under the Credit Agreement,
Pledgor shall deliver funds in such an amount for deposit in the Collateral
Account in accordance with Section 3(a). Upon any drawing under any outstanding
Letter of Credit in respect of which Pledgor has deposited in the Collateral
Account any amounts described above, Secured Party shall apply such amounts to
reimburse the Issuing Lender for the amount of such drawing. In the event the
amount deposited in the Collateral Account pursuant to this Section 3(b) exceeds
the maximum amount available to be drawn under all Letters of Credit, Secured
Party shall apply such excess amount then on deposit in the Collateral Account
in accordance with subsection 2.4D of the Credit Agreement.
(c) Pledgor shall, promptly after initiating a transfer of funds to
the Collateral Account, give notice to Secured Party by telefacsimile of the
date, amount and method of delivery of such deposit.
SECTION 4. Pledge of Security for Secured Obligations.
Pledgor hereby pledges and assigns to Secured Party, and hereby grants
to Secured Party a security interest in, all of Pledgor's right, title and
interest in and to the Collateral as collateral security for the prompt payment
or performance in full when due, whether at stated maturity, by required
prepayment, declaration, acceleration, demand or otherwise (including the
payment of amounts that would become due but for the operation of the automatic
stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. Section 362(a)), of
all Secured Obligations.
SECTION 5. No Investment of Amounts in the Collateral Account;
Interest on Amounts in the Collateral Account.
(a) Cash held by Secured Party in the Collateral Account shall not be
invested by Secured Party but instead shall be maintained as a cash deposit in
the Collateral Account pending application thereof as elsewhere provided in this
Agreement.
(b) To the extent permitted under Regulation Q of the Board of
Governors of the Federal Reserve System, any cash held in the Collateral Account
shall bear interest at the standard
XVIII-3
rate paid by Secured Party to its customers for deposits of like amounts and
terms.
(c) Subject to Secured Party's rights under Section 12, any interest
earned on deposits of cash in the Collateral Account in accordance with
subsection 5(b) shall be deposited directly into and held in the Collateral
Account.
SECTION 6. Representations and Warranties.
Pledgor represents and warrants as follows:
(a) Ownership of Collateral. Pledgor is (or at the time of transfer
thereof to Secured Party will be) the legal and beneficial owner of the
Collateral from time to time transferred by Pledgor to Secured Party, free
and clear of any Lien except for the security interest created by this
Agreement.
(b) Governmental Authorizations. No authorization, approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for either (i) the grant by Pledgor of the
security interest granted hereby, (ii) the execution, delivery or
performance of this Agreement by Pledgor, or (iii) the perfection of or the
exercise by Secured Party of its rights and remedies hereunder (except as
may have been taken by or at the direction of Pledgor).
(c) Perfection. The pledge and assignment of the Collateral pursuant
to this Agreement creates a valid and perfected first priority security
interest in the Collateral, securing the payment of the Secured
Obligations.
(d) Other Information. All information heretofore, herein or
hereafter supplied to Secured Party by or on behalf of Pledgor with respect
to the Collateral is accurate and complete in all respects.
XVIII-4
SECTION 7. Further Assurances.
Pledgor agrees that from time to time, at the expense of Pledgor,
Pledgor will promptly execute and deliver all further instruments and documents,
and take all further action, that may be necessary or desirable, or that Secured
Party may request, in order to perfect and protect any security interest granted
or purported to be granted hereby or to enable Secured Party to exercise and
enforce its rights and remedies hereunder with respect to any Collateral.
Without limiting the generality of the foregoing, Pledgor will: (a) execute and
file such financing or continuation statements, or amendments thereto, and such
other instruments or notices, as may be necessary or desirable, or as Secured
Party may request, in order to perfect and preserve the security interests
granted or purported to be granted hereby and (b) at Secured Party's request,
appear in and defend any action or proceeding that may affect Pledgor's
beneficial title to or Secured Party's security interest in all or any part of
the Collateral.
SECTION 8. Transfers and other Liens.
Pledgor agrees that it will not (a) sell, assign (by operation of law
or otherwise) or otherwise dispose of any of the Collateral or (b) create or
suffer to exist any Lien upon or with respect to any of the Collateral, except
for the security interest under this Agreement.
SECTION 9. Secured Party Appointed Attorney-in-Fact.
Pledgor hereby irrevocably appoints Secured Party as Pledgor's
attorney-in-fact, with full authority in the place and stead of Pledgor and in
the name of Pledgor, Secured Party or otherwise, from time to time in Secured
Party's discretion to take any action and to execute any instrument that Secured
Party may deem necessary or advisable to accomplish the purposes of this
Agreement, including without limitation to file one or more financing or
continuation statements, or amendments thereto, relative to all or any part of
the Collateral without the signature of Pledgor.
SECTION 10. Secured Party May Perform.
If Pledgor fails to perform any agreement contained herein, Secured
Party may itself perform, or cause performance of, such agreement, and the
expenses of Secured Party incurred in connection therewith shall be payable by
Pledgor under subsection 10.2 of the Credit Agreement.
SECTION 11. Standard of Care.
The powers conferred on Secured Party hereunder are solely to protect
its interest in the Collateral and shall not impose any duty upon it to exercise
any such powers. Except for the exercise of reasonable care in the custody of
any Collateral in its possession and the accounting for moneys actually received
by it hereunder, Secured Party shall have no duty as to any
XVIII-5
Collateral, it being understood that Secured Party shall have no
responsibility for (a) taking any necessary steps (other than steps taken in
accordance with the standard of care set forth above to maintain possession
of the Collateral) to preserve rights against any parties with respect to any
Collateral or (b) taking any necessary steps to collect or realize upon the
Secured Obligations or any guarantee therefor, or any part thereof, or any of
the Collateral. Secured Party shall be deemed to have exercised reasonable
care in the custody and preservation of Collateral in its possession if such
Collateral is accorded treatment substantially equal to that which Secured
Party accords its own property of like kind.
SECTION 12. Remedies.
(a) If any Event of Default or Potential Event of Default shall have
occurred and be continuing, Secured Party may (i) transfer any or all of the
Collateral to an account established in Secured Party's name (whether at Secured
Party or otherwise) or (ii) otherwise register title to any Collateral in the
name of Secured Party or one of its nominees or agents, without reference to any
interest of Pledgor.
(b) If any Event of Default shall have occurred and be continuing,
subject to the provisions of subsection 3(b), Secured Party may exercise in
respect of the Collateral, in addition to all other rights and remedies
otherwise available to it, all the rights and remedies of a secured party on
default under the Uniform Commercial Code as in effect in any relevant
jurisdiction (the "Code") (whether or not the Code applies to the affected
Collateral).
(c) If the proceeds of any disposition of the Collateral are
insufficient to pay all the Secured Obligations, Pledgor shall be liable for the
deficiency and the fees of any attorneys employed by Secured Party to collect
such deficiency.
(d) Anything contained herein to the contrary notwithstanding, any of
the Collateral consisting of cash held by Secured Party in the Collateral
Account shall be subject to Secured Party's rights of set-off under subsection
10.4 of the Credit Agreement.
SECTION 13. Continuing Security Interest; Transfer of Loans.
This Agreement shall create a continuing security interest in the
Collateral and shall (a) remain in full force and effect until the payment in
full of the Secured Obligations, the cancellation or termination of the
Commitments and the cancellation or expiration of all outstanding Letters of
Credit, (b) be binding upon Pledgor, its successors and assigns, and (c) inure,
together with the rights and remedies of Secured Party hereunder, to the benefit
of Secured Party and its successors, transferees and assigns. Without limiting
the generality of the foregoing clause (c), but subject to the provisions of
subsection 10.1 of the Credit Agreement, any Lender may assign or otherwise
transfer any Loans held by it to any other Person, and such other
XVIII-6
Person shall thereupon become vested with all the benefits in respect thereof
granted to Lenders herein or otherwise. Upon the payment in full of all
Secured Obligations, the cancellation or termination of the Commitments and
the cancellation or expiration of all outstanding Letters of Credit, the
security interest granted hereby shall terminate and all rights to the
Collateral shall revert to Pledgor. Upon any such termination Secured Party
shall, at Pledgor's expense, execute and deliver to Pledgor such documents as
Pledgor shall reasonably request to evidence such termination and Pledgor
shall be entitled to the return, upon its request and at its expense, against
receipt and without recourse to Secured Party, of such of the Collateral as
shall not have been otherwise applied pursuant to the terms hereof.
SECTION 14. Secured Party as Administrative Agent.
(a) Secured Party has been appointed to act as Secured Party
hereunder by Lenders. Secured Party shall be obligated, and shall have the
right hereunder, to make demands, to give notices, to exercise or refrain
from exercising any rights, and to take or refrain from taking any action
(including without limitation the release or substitution of Collateral),
solely in accordance with this Agreement and the Credit Agreement.
(b) Secured Party shall at all times be the same Person that is
Administrative Agent under the Credit Agreement. Written notice of
resignation by Administrative Agent pursuant to subsection 9.5 of the Credit
Agreement shall also constitute notice of resignation as Secured Party under
this Agreement; removal of Administrative Agent pursuant to subsection 9.5 of
the Credit Agreement shall also constitute removal as Secured Party under
this Agreement; and appointment of a successor Administrative Agent pursuant
to subsection 9.5 of the Credit Agreement shall also constitute appointment
of a successor Secured Party under this Agreement. Upon the acceptance of
any appointment as Administrative Agent under subsection 9.5 of the Credit
Agreement by a successor Administrative Agent, that successor Administrative
Agent shall thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the retiring or removed Secured Party under
this Agreement, and the retiring or removed Secured Party under this
Agreement shall promptly (i) transfer to such successor Secured Party all
sums held by Secured Party hereunder (which shall be deposited in a new
Collateral Account established and maintained by such successor Secured
Party), together with all records and other documents necessary or
appropriate in connection with the performance of the duties of the successor
Secured Party under this Agreement, and (ii) execute and deliver to such
successor Secured Party such amendments to financing statements, and take
such other actions, as may be necessary or appropriate in connection with the
assignment to such successor Secured Party of the security interests created
hereunder, whereupon such retiring or removed Secured Party shall be
discharged from its duties and obligations under this Agreement. After any
retiring or removed Administrative Agent's resignation or removal hereunder
as Secured Party, the provisions of this Agreement shall inure to its benefit
as to any actions taken or omitted to be taken by it
XVIII-7
under this Agreement while it was Secured Party hereunder.
SECTION 15. Amendments; Etc.
No amendment, modification, termination or waiver of any provision of
this Agreement, and no consent to any departure by Pledgor therefrom, shall in
any event be effective unless the same shall be in writing and signed by Secured
Party and, in the case of any such amendment or modification, by Pledgor. Any
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which it was given.
SECTION 16. Notices.
Unless otherwise specifically provided herein, any notice or other
communication herein required or permitted to be given shall be in writing and
may be personally served, telexed or sent by telefacsimile or United States mail
or courier service and shall be deemed to have been given when delivered in
person or by courier service, upon receipt of telefacsimile or telex (with
received answerback), or three Business Days after depositing it in the United
States mail with postage prepaid and properly addressed; provided that notices
to Secured Party shall not be effective until received. For the purposes
hereof, the address of each party hereto shall be as provided in subsection 10.8
of the Credit Agreement.
SECTION 17.Failure or Indulgence Not Waiver;
Remedies Cumulative.
No failure or delay on the part of Secured Party in the exercise of
any power, right or privilege hereunder shall impair such power, right or
privilege or be construed to be a waiver of any default or acquiescence therein,
nor shall any single or partial exercise of any such power, right or privilege
preclude any other or further exercise thereof or of any other power, right or
privilege. All rights and remedies existing under this Agreement are cumulative
to, and not exclusive of, any rights or remedies otherwise available.
SECTION 18. Severability.
In case any provision in or obligation under this Agreement shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.
SECTION 19. Headings.
Section and subsection headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
SECTION 20. Governing Law; Terms.
XVIII-8
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING WITHOUT LIMITATION SECTION
5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD
TO CONFLICTS OF LAWS PRINCIPLES, EXCEPT TO THE EXTENT THAT THE CODE PROVIDES
THAT THE PERFECTION OF THE SECURITY INTEREST HEREUNDER, OR REMEDIES HEREUNDER,
IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A
JURISDICTION OTHER THAN THE STATE OF NEW YORK. Unless otherwise defined herein
or in the Credit Agreement, terms used in Articles 8 and 9 of the Uniform
Commercial Code in the State of New York are used herein as therein defined.
SECTION 21. Counterparts.
This Agreement may be executed in one or more counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document.
[Remainder of page intentionally left blank]
XVIII-9
IN WITNESS WHEREOF, Pledgor and Secured Party have caused this
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
AURORA FOODS INC.
By: _________
Name:
Title:
THE CHASE MANHATTAN BANK,
as Secured Party
By: ___________
Name:
Title:
XVIII-10
EXHIBIT XIX
[FORM OF COLLATERAL ACCESS AGREEMENT]
COLLATERAL ACCESS AGREEMENT
|
RECORDING REQUESTED BY: |
Xxxxxxx Xxxxxxx & Xxxxxxxx |
|
AND WHEN RECORDED MAIL TO: |
Xxxxxxx Xxxxxxx & Xxxxxxxx |
000 Xxxxxxxxx Xxxxxx x
Xxx Xxxx, Xxx Xxxx 00000 |
Attn: Xxxxx Xxxxxxxx |
|
Re: AURORA FOODS INC. |
-------------------------------------------------------------------------------
Space above this line for recorder's use only
REAL PROPERTY HOLDER'S WAIVER AND CONSENT AGREEMENT
This REAL PROPERTY HOLDER'S WAIVER AND CONSENT AGREEMENT (this
"Agreement") is dated as of ____, [199_][200_] and entered into by
__________________, a ___________________ ("Real Property Holder"), to and for
the benefit of THE CHASE MANHATTAN BANK, having offices at 000 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, as administrative agent (in such capacity, "Administrative
Agent") for the financial institutions ("Lenders") which are or may hereafter
become parties to the Credit Agreement (as hereinafter defined).
R E C I T A L S
C. [Aurora Foods Inc.] [Name of Subsidiary], a [_________] corporation
("Company"), has possession of and occupies all or a portion of the property
described on Exhibit A annexed hereto (the "Premises").
D. Company's interest in the Premises [arises under the lease
agreement (the "Lease")][is subject to the [mortgage][deed of trust] (the
"Mortgage")] more particularly described on Exhibit B annexed hereto, pursuant
to which Real Property Holder has rights, upon the terms and conditions set
forth therein, to take possession of, and otherwise assert control over, the
Premises.
E. Administrative Agent, Lenders, National Westminster Bank PLC, as
Syndication Agent, and UBS AG, Stamford Branch, as Documentation Agent, have
entered into that certain Third Amended and Restated Credit Agreement dated as
of July 1, 1998 (said Third Amended and Restated Credit Agreement, as amended,
restated, supplemented or otherwise modified from time to time,
XIX-1
being the "Credit Agreement") with [Company] [Aurora Foods Inc., a
Delaware corporation of which Company is a subsidiary ("Borrower")]
and Company has executed [a guaranty,] a security agreement and other
collateral documents in relation to the Credit Agreement.
F. [Company's guaranty of] the extensions of credit made by Lenders
to [Company] [Borrower] under the Credit Agreement will be secured, in part,
by all raw materials, work-in-process and finished goods inventory of Company
(including all inventory of Company now or hereafter located on the Premises
(the "Inventory")) and all equipment, machinery and other goods used in
Company's business (including all equipment of Company now or hereafter located
on the Premises (the "Equipment" and, together with the Inventory, the
"Collateral")).
G. Administrative Agent has requested that Real Property Holder
execute this Agreement as a condition to the extension of credit to [Company]
[Borrower] under the Credit Agreement.
NOW, THEREFORE, in consideration of the premises and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Real Property Holder hereby represents and warrants to, and
covenants and agrees with, Administrative Agent as follows:
1. Real Property Holder hereby (a) waives and releases unto
Administrative Agent and its successors and assigns any and all rights granted
by or under any present or future laws to levy or distraint for rent or any
other charges which may be due to Real Property Holder against the Collateral,
and any and all other claims, liens and demands of every kind which it now has
or may hereafter have against the Collateral, and (b) agrees that any rights it
may have in or to the Collateral, no matter how arising (to the extent not
effectively waived pursuant to clause (a) of this paragraph 1), shall be second
and subordinate to the rights of Administrative Agent in respect thereof. Real
Property Holder acknowledges that the Collateral is and will remain personal
property and not fixtures even though it may be affixed to or placed on the
Premises.
2. Real Property Holder certifies that (a) Real Property Holder is
the [landlord under the Lease][beneficiary under the Mortgage], (b) the
[Lease][Mortgage] is in full force and effect and has not been amended,
modified, or supplemented except as set forth on Exhibit B annexed hereto, (c)
there is no defense, offset, claim or counterclaim by or in favor of Real
Property Holder against Company under the [Lease][Mortgage] or against the
obligations of Real Property Holder under the [Lease][Mortgage], (d) no notice
of default has been given under or in connection with the [Lease][Mortgage]
which has not been cured, and Real Property Holder has no knowledge of the
occurrence of any other default under or in connection with the
[Lease][Mortgage], and (e) except as disclosed to Administrative Agent, no
portion of the Premises is encumbered in any way by any deed of trust or
mortgage lien or ground or superior lease.
XIX-2
3. Real Property Holder consents to the installation or placement of
the Collateral on the Premises, and Real Property Holder grants to
Administrative Agent a license to enter upon and into the Premises to do any or
all of the following with respect to the Collateral: assemble, have appraised,
display, remove, maintain, prepare for sale or lease, repair, transfer, or sell
(at public or private sale). In entering upon or into the Premises,
Administrative Agent hereby agrees to indemnify, defend and hold Real Property
Holder harmless from and against any and all claims, judgments, liabilities,
costs and expenses incurred by Real Property Holder caused solely by
Administrative Agent's entering upon or into the Premises and taking any of the
foregoing actions with respect to the Collateral. Such costs shall include any
damage to the Premises made by Administrative Agent in severing and/or removing
the Collateral therefrom.
4. Real Property Holder agrees that it will not prevent
Administrative Agent or its designee from entering upon the Premises at all
reasonable times to inspect or remove the Collateral. In the event that Real
Property Holder has the right to, and desires to, obtain possession of the
Premises [(either through expiration of the Lease or termination thereof due to
the default of Company thereunder)] [(through the exercise of its rights under
the Mortgage upon a default by Company thereunder)], Real Property Holder will
deliver notice (the "Real Property Holder's Notice") to Administrative Agent to
that effect. Within the 45 day period after Administrative Agent receives the
Real Property Holder's Notice, Administrative Agent shall have the right, but
not the obligation, to cause the Collateral to be removed from the Premises.
During such 45 day period, Real Property Holder will not remove the Collateral
from the Premises nor interfere with Administrative Agent's actions in removing
the Collateral from the Premises or Administrative Agent's actions in otherwise
enforcing its security interest in the Collateral. Notwithstanding anything to
the contrary in this paragraph, Administrative Agent shall at no time have any
obligation to remove the Collateral from the Premises.
5. Real Property Holder shall send to Administrative Agent a copy of
any notice of default under the [Lease][Mortgage] sent by Real Property Holder
to Company. In addition, Real Property Holder shall send to Administrative
Agent a copy of any notice received by Real Property Holder of a breach or
default under any other lease, mortgage, deed of trust, security agreement or
other instrument to which Real Property Holder is a party which may affect
Company's rights in, or possession of, the Premises.
6. All notices to Administrative Agent under this Agreement shall be
in writing and sent to Administrative Agent at its address set forth on the
signature page hereof by telefacsimile, by United States mail, or by overnight
delivery service.
7. The provisions of this Agreement shall continue in
XIX-3
effect until Real Property Holder shall have received Administrative Agent's
written certification that all amounts advanced under the Credit Agreement
have been paid in full.
8. This Agreement and the rights and obligations of the parties
hereunder shall be governed by, and shall be construed and enforced in
accordance with, the internal laws of the State of New York, without regard to
conflicts of laws principles.
XIX-4
IN WITNESS WHEREOF, the undersigned has caused this Agreement to be
duly executed and delivered as of the day and year first set forth above.
[NAME OF REAL PROPERTY HOLDER]
By: ____________________
Name:
Title:
By its acceptance hereof, as of the day and year first set forth
above, Administrative Agent agrees to be bound by the provisions hereof.
THE CHASE MANHATTAN BANK,
as Administrative Agent
By: _______________________
Name:
Title:
XIX-5
EXHIBIT A TO COLLATERAL ACCESS AGREEMENT
LEGAL DESCRIPTION OF PREMISES
XIX-6
EXHIBIT B TO COLLATERAL ACCESS AGREEMENT
DESCRIPTION OF [LEASE] [MORTGAGE]
XIX-7
EXHIBIT XX
[FORM OF MORTGAGE]
Erie, Pennsylvania
OPEN-END
MORTGAGE
from
AURORA FOODS INC., Mortgagor
to
THE CHASE MANHATTAN BANK, as Administrative Agent, Mortgagee
DATED AS OF JULY 1, 1998
After recording, please return to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
ATTN: Xxxxx X. Xxxxxxxx, Esq.
XIX-1
[Erie]
OPEN-END MORTGAGE AND SECURITY AGREEMENT
THIS MORTGAGE, dated as of June ___, 1998 is made by AURORA FOODS
INC., a Delaware corporation ("Mortgagor"), whose address is 000 Xxxxxxxxxx
Xxxxxx, Xxxxxxxx, Xxxx 00000, to THE CHASE MANHATTAN BANK, a New York banking
corporation, whose address is 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, as
Agent (in such capacity, "Mortgagee") for itself and for the several banks and
financial institutions from time to time parties to that certain Third Amended
and Restated Credit Agreement dated as of the date hereof among Mortgagor, the
several banks and other financial institutions from time to time parties thereto
(collectively, the "Lenders"; individually, a "Lender"), National Westminster
Bank PLC, as Syndication Agent, UBS AG, Stamford Branch, as Documentation Agent
and Mortgagee (as the same may be amended, restated, supplemented, modified or
replaced from time to time, the "Credit Agreement"). References to this
"Mortgage" shall mean this instrument and any and all renewals, modifications,
amendments, supplements, extensions, consolidations, substitutions, spreaders
and replacements of this instrument. Unless otherwise defined herein,
capitalized terms shall have the meanings ascribed to them in the Credit
Agreement.
Background
WHEREAS, Mortgagor proposes to (i) issue equity of Mortgagor in an
initial public offering (the "Initial Public Offering"), (ii) issue a rule 144A
private placement or a public offering of at least $200,000,000 principal amount
of New Subordinated Notes and (iii) refinance certain of its existing
Indebtedness (collectively, the "Transactions");
WHEREAS, as of the date of the Initial Public Offering, Mortgagor will
be the survivor of mergers involving A Foods, Holdings, Mortgagor, VDK Holdings
and Van xx Xxxx'x;
WHEREAS, Mortgagor has requested that Mortgagee and the Lenders enter
into the Credit Agreement to provide a portion of the funds required to (i)
refinance the existing Indebtedness under the Existing Credit Agreement, (ii)
reduce the VDK Subordinated Notes, (iii) pay the Transaction Costs and (iv)
provide for the working capital requirements and for general corporate purposes
of Mortgagor and its Subsidiaries;
WHEREAS, Mortgagor is the fee owner of the parcel(s) of real property
together with the improvements located thereon (the "Improvements") described on
Schedule A attached hereto (the "Real Estate"); and
XX-2
WHEREAS, pursuant to the terms of the Credit Agreement, the Lenders
have agreed, among other things, to make the Term Loans, Revolving Loans and
Swing Line Loans to, and the Issuing Lender has agreed to issue the Letters of
Credit for the account of, Mortgagor on the condition (among others) that
Mortgagor grant to Mortgagee a first lien upon and perfected security interest
in, among other things, all estate, right, title and interest of the Mortgagor
in and to the Real Estate pursuant to the terms hereof;
NOW THEREFORE, in consideration of the premises and for the sum of Ten
Dollars ($10.00), the receipt and sufficiency of which is hereby acknowledged,
Mortgagor hereby agrees as follows:
Granting Clauses
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Mortgagor agrees that to secure:
(a) the repayment of principal of and interest on (including, without
limitation, accruing at the then applicable rate provided in the Credit
Agreement after maturity of the Loans and reimbursement obligations under
the Letters of Credit and interest accruing at the then applicable rate
provided in the Credit Agreement after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to any Loan Party, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding) the
Loans and all other obligations (including the reimbursement Obligations
under the Letters of Credit) and liabilities of Mortgagor to Mortgagee, the
Issuing Lender and the Lenders, whether direct or indirect, absolute or
contingent, due or to become due, now existing or hereafter incurred, which
may arise under, out of, or in connection with, the Credit Agreement, the
Notes, the Loans, the Letters of Credit, the other Loan Documents, any
Interest Rate Agreement entered into by Mortgagor with any Lender, any cash
management services agreement entered into by Mortgagor with any Lender or
any Affiliate of any Lender, or any other document made, delivered or given
in connection therewith, in each case whether on account of principal,
interest, reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, without limitation, all reasonable fees, charges and
disbursements of counsel to the Agent, the Issuing Lender or any Lender
that are required to be paid by any Loan Party pursuant to the Credit
Agreement, any other Loan Document or any such Interest Rate Agreement or
cash management services agreement entered into by Mortgagor with any
Lender or any Affiliate of any Lender) (the items set forth above being
referred to collectively as the "Indebtedness"); and
(b) the performance of all covenants, agreements, obligations and
liabilities of Mortgagor (the "Obligations")
XX-3
under or pursuant to the provisions of the Credit Agreement, the Notes,
the Loans, the Letters of Credit, this Mortgage, any other document
securing payment of the Indebtedness (the "Security Documents"), any
other Loan Document or any such Interest Rate Agreement or cash management
services agreement entered into by Mortgagor with any Lender or any
Affiliate of any Lender and any amendments, supplements, extensions,
renewals, restatements, replacements or modifications of any of the
foregoing (the Credit Agreement, the Notes, the Loans, the Letters of
Credit, the applications for Letters of Credit, this Mortgage and all
other documents and instruments from time to time evidencing, securing
or guaranteeing the payment of the Indebtedness or the performance of the
Obligations, as any of the same may be amended, supplemented, extended,
renewed, restated, replaced or modified from time to time, are
collectively referred to as the "Loan Documents"); and
MORTGAGOR HEREBY GRANTS TO MORTGAGEE A LIEN UPON AND A SECURITY INTEREST IN, AND
HEREBY MORTGAGES, GRANTS, ASSIGNS, TRANSFERS AND SETS OVER TO MORTGAGEE:
(A) the Real Estate;
(B) all the estate, right, title, claim or demand whatsoever of
Mortgagor, in possession or expectancy, in and to the Real Estate or any
part thereof;
(C) all right, title and interest of Mortgagor in, to and under all
easements, rights of way, gores of land, streets, ways, alleys, passages,
sewer rights, waters, water courses, water and riparian rights, development
rights, air rights, mineral rights, oil and gas rights and all estates,
rights, titles, interests, privileges, licenses, tenements, hereditaments
and appurtenances belonging, relating or appertaining to the Real Estate,
and any reversions, remainders, rents, issues, profits and revenue thereof
and all land lying in the bed of any street, road or avenue, in front of or
adjoining the Real Estate to the center line thereof;
(D) all of the fixtures, chattels, business machines, machinery,
apparatus, equipment, furnishings, fittings and articles of personal
property of every kind and nature whatsoever, and all appurtenances and
additions thereto and substitutions or replacements thereof (together with,
in each case, attachments, components, parts and accessories) currently
owned or subsequently acquired by Mortgagor and now or subsequently
attached to, or contained in or used in any way in connection with any
operation or letting of the Real Estate, including but without limiting the
generality of the foregoing, all screens, awnings, shades, blinds,
curtains, draperies, artwork, carpets, rugs, storm doors and windows,
furniture and furnishings, heating, electrical, and mechanical equipment,
lighting, switchboards, plumbing, ventilating, air conditioning and
air-cooling apparatus, refrigerating, and incinerating equipment,
escalators, elevators, loading and unloading equipment and systems, stoves,
ranges, laundry equipment, cleaning systems (including window cleaning
apparatus),
XX-4
telephones, communication systems (including satellite dishes and
antennae), televisions, computers, sprinkler systems and other fire
prevention and extinguishing apparatus and materials, security systems,
motors, engines, machinery, pipes, pumps, tanks, conduits, appliances,
fittings and fixtures of every kind and description (all of the foregoing
in this paragraph (D) being referred to as the "Equipment");
(E) all right, title and interest of Mortgagor in and to all
substitutes and replacements of, and all additions and improvements to, the
Real Estate and the Equipment, subsequently acquired by or released to
Mortgagor or constructed, assembled or placed by Mortgagor on the Real
Estate, immediately upon such acquisition, release, construction,
assembling or placement, including, without limitation, any and all
building materials owned by the Mortgagor and to be incorporated in or on
the Real Estate whether stored at the Real Estate or offsite, and, in each
such case, without any further mortgage, conveyance, assignment or other
act by Mortgagor;
(F) all right, title and interest of Mortgagor in, to and under all
leases, subleases, underlettings, concession agreements, management
agreements, licenses and other agreements relating to the use or occupancy
of the Real Estate or the Equipment or any part thereof, now existing or
subsequently entered into by Mortgagor and whether written or oral and all
guarantees of any of the foregoing (collectively, as any of the foregoing
may be amended, restated, extended, renewed or modified from time to time,
the "Leases"), and all rights of Mortgagor in respect of cash and
securities deposited thereunder and the right to receive and collect the
revenues, income, rents, issues and profits thereof, together with all
other rents, royalties, issues, profits, revenue, income and other benefits
arising from the use and enjoyment of the Mortgaged Property (as defined
below) (collectively, the "Rents");
(G) all trade names, trade marks, logos, copyrights, good will and
books and records relating to or used in connection with the ownership and
operation of the Real Estate or the Equipment or any part thereof; all
general intangibles related to the ownership and operation of the
Improvements now existing or hereafter arising;
(H) all unearned premiums under insurance policies now or
subsequently obtained by Mortgagor relating to the Real Estate or Equipment
and Mortgagor's interest in and to all proceeds of any such insurance
policies (including title insurance policies) including the right to
collect and receive such proceeds, subject to the provisions relating to
insurance generally set forth below; and all awards and other compensation,
including the interest payable thereon and the right to collect and receive
the same, made to the present or any subsequent owner of the Real Estate or
Equipment for the taking by eminent domain, condemnation or otherwise, of
all or
XX-5
any part of the Real Estate or any easement or other right therein;
(I) all right, title and interest of Mortgagor in and to (i) all
contracts from time to time executed by Mortgagor or any manager or agent
on its behalf relating to the ownership, construction, maintenance, repair,
operation, occupancy, sale or financing of the Real Estate or Equipment or
any part thereof and all agreements relating to the purchase or lease of
any portion of the Real Estate or any property which is adjacent or
peripheral to the Real Estate, together with the right to exercise such
options and all leases of Equipment (collectively, the "Contracts"), (ii)
all consents, licenses, building permits, certificates of occupancy and
other governmental approvals relating to construction, completion,
occupancy, use or operation of the Real Estate or any part thereof
(collectively, the "Permits") and (iii) all drawings, plans, specifications
and similar or related items relating to the Real Estate (collectively, the
"Plans");
(J) any and all monies now or subsequently on deposit for the payment
of real estate taxes or special assessments against the Real Estate or for
the payment of premiums on insurance policies covering the foregoing
property or otherwise on deposit with or held by Mortgagee as provided in
this Mortgage; all capital, operating, reserve or similar accounts held by
or on behalf of Mortgagor and related to the ownership and operation of the
Mortgaged Property, whether now existing or hereafter arising and all
monies held in any of the foregoing accounts and any certificates or
instruments related to or evidencing such accounts;
(K) all accounts and revenues arising from the operation of the
rental Improvements including, without limitation, (i) any right to payment
now existing or hereafter arising for rental of hotel rooms or other space
or for goods sold or leased or for services rendered, whether or not yet
earned by performance, arising from the operation of the Improvements or
any other facility on the Mortgaged Property and (ii) all rights to payment
from any consumer credit-charge card organization or entity including,
without limitation, payments arising from the use of the American Express
Card, the Visa Card, the Xxxxx Xxxxxxx Card, the Mastercard or any other
credit card, including those now existing or hereafter created,
substitutions therefor, proceeds thereof (whether cash or non-cash, movable
or immovable, tangible or intangible) received upon the sale, exchange,
transfer, collection or other disposition or substitution thereof and any
and all of the foregoing and proceeds therefrom; and
(L) all proceeds, both cash and noncash, of the foregoing;
(All of the foregoing property and rights and interests now owned or
held or subsequently acquired by Mortgagor and described in the foregoing
clauses (A) through (E) are collectively referred to as the "Premises", and
those described
XX-6
in the foregoing clauses (A) through (L) are collectively referred to as the
"Mortgaged Property").
TO HAVE AND TO HOLD the Mortgaged Property and the rights and
privileges hereby mortgaged unto Mortgagee, its successors and assigns for the
uses and purposes set forth, until the Indebtedness is fully paid and the
Obligations fully performed or otherwise discharged.
Terms and Conditions
Mortgagor further represents, warrants, covenants and agrees with
Mortgagee as follows:
0.1 Warranty of Title. Mortgagor warrants that Mortgagor has good
title to the Real Estate in fee simple and good title to the rest of the
Mortgaged Property, subject only to the matters that are set forth in Schedule B
of the title insurance policy or policies being issued to Mortgagee to insure
the lien of this Mortgage (the "Permitted Exceptions") or any Permitted Liens
under the Loan Documents and Mortgagor shall warrant, defend and preserve such
title and the lien of the Mortgage thereon against all claims of all persons and
entities. Mortgagor further warrants that it has the right to mortgage the
Mortgaged Property.
0.2 Payment of Indebtedness. Mortgagor shall pay the Indebtedness at
the times and places and in the manner specified in the Credit Agreement and
shall perform all the Obligations as required under the Loan Documents.
0.3 Requirements.
(a) Mortgagor shall promptly comply with, or cause to be complied
with, and conform to all present and future laws, statutes, codes, ordinances,
orders, judgments, decrees, rules, regulations and requirements applicable to
the Mortgaged Property, and irrespective of the nature of the work to be done,
of each of the United States of America, any State and any municipality, local
government or other political subdivision thereof and any agency, department,
bureau, board, commission or other instrumentality of any of them, now existing
or subsequently created (collectively, "Governmental Authority") which has
jurisdiction over the Mortgaged Property and all covenants, restrictions and
conditions now or later of record which may be applicable to any of the
Mortgaged Property, or to the use, manner of use, occupancy, possession,
operation, maintenance, alteration, repair or reconstruction of any of the
Mortgaged Property. All present and future laws, statutes, codes, ordinances,
orders, judgments, decrees, rules, regulations and requirements of every
Governmental Authority applicable to Mortgagor or to any of the Mortgaged
Property and all covenants, restrictions, and conditions which now or later may
be applicable to any of the Mortgaged Property are collectively referred to as
the "Legal Requirements".
XX-7
(b) From and after the date of this Mortgage, Mortgagor shall not by
act or omission permit any building or other improvement on any premises not
subject to the lien of this Mortgage to rely on the Premises or any part thereof
or any interest therein to fulfill any Legal Requirement, and Mortgagor hereby
assigns to Mortgagee any and all rights to give consent for all or any portion
of the Premises or any interest therein to be so used. Mortgagor shall not by
act or omission impair the integrity of any of the Real Estate as a single
zoning lot separate and apart from all other premises. Mortgagor represents
that each parcel of the Real Estate constitutes a legally subdivided lot, in
compliance with all subdivision laws and similar Legal Requirements. Any act or
omission by Mortgagor which would result in a violation of any of the provisions
of this subsection shall be void.
0.4 Payment of Taxes and Other Impositions. (a) Promptly when due,
Mortgagor shall pay and discharge all taxes of every kind and nature (including,
without limitation, all real and personal property, income, franchise,
withholding, transfer, gains, profits and gross receipts taxes), all charges for
any easement or agreement maintained for the benefit of any of the Mortgaged
Property, all general and special assessments, levies, permits, inspection and
license fees, all water and sewer rents and charges and all other public charges
even if unforeseen or extraordinary, imposed upon or assessed against or which
may become a lien on any of the Mortgaged Property, or arising in respect of the
occupancy, use or possession thereof, together with any penalties or interest on
any of the foregoing (all of the foregoing are collectively referred to as the
"Impositions"). Mortgagor shall within 10 business days after request by
Mortgagee deliver to Mortgagee (i) original or copies of receipted bills and
cancelled checks evidencing payment of such Imposition if it is a real estate
tax or other public charge and (ii) evidence reasonably acceptable to Mortgagee
showing the payment of any other such Imposition. If by law any Imposition, at
Mortgagor's option, may be paid in installments (whether or not interest shall
accrue on the unpaid balance of such Imposition), Mortgagor may elect to pay
such Imposition in such installments and shall be responsible for the payment of
such installments with interest, if any.
(b) Nothing herein shall affect any right or remedy of Mortgagee
under this Mortgage or otherwise, without notice or demand to Mortgagor, to pay
any Imposition after the date such Imposition shall have become due, and to add
to the Indebtedness the amount so paid, together with interest from the time of
payment at the rate of interest set forth in Section 4.4 (c) of the Credit
Agreement (the "Default Rate"). Any sums paid by Mortgagee in discharge of any
Impositions shall be (i) a lien on the Premises secured hereby prior to any
right or title to, interest in, or claim upon the Premises subordinate to the
lien of this Mortgage, and (ii) payable on demand by Mortgagor to Mortgagee
together with interest at the Default Rate as set forth above.
(c) Mortgagor shall not claim, demand or be entitled to
XX-8
receive any credit or credits toward the satisfaction of this Mortgage or on
any interest payable thereon for any taxes assessed against the Mortgaged
Property or any part thereof, and shall not claim any deduction from the
taxable value of the Mortgaged Property by reason of this Mortgage.
(d) Mortgagor shall have the right before any delinquency occurs to
contest or object in good faith to the amount or validity of any Imposition by
appropriate legal proceedings, but such right shall not be deemed or construed
in any way as relieving, modifying, or extending Mortgagor's covenant to pay any
such Imposition at the time and in the manner provided in this Section unless
(i) Mortgagor has given prior written notice to Mortgagee of Mortgagor's intent
so to contest or object to an Imposition, (ii) Mortgagor shall demonstrate to
Mortgagee's satisfaction that the legal proceedings shall operate conclusively
to prevent the sale of the Mortgaged Property, or any part thereof, to satisfy
such Imposition prior to final determination of such proceedings and (iii)
Mortgagor shall furnish a good and sufficient bond or surety or other security
as requested by and reasonably satisfactory to Mortgagee in the amount of the
Impositions which are being contested plus any interest and penalty which may be
imposed thereon and which could become a lien against the Real Estate or any
part of the Mortgaged Property.
(e) Upon written notice to Mortgagor, Mortgagee after an Event of
Default (as defined below) shall be entitled to require Mortgagor to pay monthly
in advance to Mortgagee the equivalent of 1/12th of the estimated annual
Impositions. Mortgagee shall keep such funds in a separate account, and
Mortgagor shall not be entitled to interest thereon. Mortgagee shall use such
funds to pay the Impositions as they become due and any funds remaining may be
applied by Mortgagee, in its sole discretion, to the Indebtedness in the reverse
order of Maturity.
0.5 Insurance. (a) Mortgagor shall maintain or cause to be
maintained on all of the Premises
(i) property insurance against loss or damage by fire, lightning,
windstorm, tornado, water damage, flood, earthquake and by such other
further risks and hazards as now are or subsequently may be covered by an
"all risk" policy or a fire policy covering "special" causes of loss. The
policy shall include building ordinance law endorsements and the policy
limits shall be automatically reinstated after each loss;
(ii) comprehensive general liability insurance under a policy
including the "broad form CGL endorsement" (or which incorporates the
language of such endorsement), covering all claims for personal injury,
bodily injury or death, or property damage occurring on, in or about the
Premises in an amount not less than $10,000,000 combined single limit with
respect to injury and property damage relating to any one occurrence plus
such excess limits as Mortgagee shall reasonably request from time to time;
XX-9
(iii) when and to the extent required by Mortgagee, insurance against
loss or damage by any other risk commonly insured against by persons
occupying or using like properties in the locality or localities in which
the Real Estate is situated;
(iv) insurance against rent loss, extra expense or business
interruption (and/or soft costs, in the case of new construction), to the
extent applicable, in amounts reasonably satisfactory to Mortgagee, but not
less than one year's gross rent or gross income;
(v) during the course of any construction or repair of Improvements,
comprehensive general liability insurance under a policy including the
"broad form CGL endorsement" (or which incorporates the language of such
endorsement), (including coverage for elevators and escalators, if any).
The policy shall include coverage for independent contractors and completed
operations. The completed operations coverage shall stay in effect for two
years after construction of any Improvements has been completed. The
policy shall provide coverage on an occurrence basis against claims for
personal injury, including, without limitation, bodily injury, death or
property damage occurring on, in or about the Premises and the adjoining
streets, sidewalks and passageways, such insurance to afford immediate
minimum protection to a limit of not less than that reasonably required by
Mortgagee with respect to personal injury, bodily injury or death to any
one or more persons or damage to property;
(vi) during the course of any construction or repair of the
Improvements, workers' compensation insurance (including employer's
liability insurance) for all employees of Mortgagor (or Mortgagor's
contractors) engaged on or with respect to the Premises in such amounts as
are required by law;
(vii) during the course of any construction, addition, alteration or
repair of the Improvements, builder's risk completed value form insurance
against "all risks of physical loss," including collapse, water damage,
flood and earthquake and transit coverage, during construction or repairs
of the Improvements, with deductible approved by Mortgagee, in nonreporting
form, covering the total value of work performed and equipment, supplies
and materials furnished (with an appropriate limit for soft costs in the
case of construction);
(viii) boiler and machinery property insurance covering pressure
vessels, air tanks, boilers, machinery, pressure piping, heating, air
conditioning and elevator equipment and escalator equipment, provided the
Improvements contain equipment of such nature, and insurance against rent,
extra expense, business interruption and soft costs, if applicable, arising
from any such breakdown, in such amounts as are reasonably satisfactory to
Mortgagee but not less than the lesser of $1,000,000 or 10% of the value of
the Improvements;
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(ix) if any portion of the Premises are located in an area identified
as a special flood hazard area by the Federal Emergency Management Agency
or other applicable agency, flood insurance in an amount reasonably
satisfactory to Mortgagee, but in no event less than the maximum limit of
coverage available under the National Flood Insurance Act of 1968, as
amended; and
(x) such other insurance in such amounts as Mortgagee may reasonably
request from time to time.
Each insurance policy (other than flood insurance written under the National
Flood Insurance Act of 1968, as amended, in which case to the extent available)
shall (i) provide that it shall not be cancelled, non-renewed or materially
amended without 30-days' prior written notice to Mortgagee, and (ii) with
respect to all property insurance, provide for deductibles not to exceed
$25,000, contain a "Replacement Cost Endorsement" without any deduction made for
depreciation and with no co-insurance penalty (or attaching an agreed amount
endorsement satisfactory to Mortgagee), with loss payable solely to Mortgagee
(modified, if necessary, to provide that proceeds in the amount of replacement
cost may be retained by Mortgagee without the obligation to rebuild) as its
interest may appear, without contribution, under a "standard" or "New York" type
mortgagee clause acceptable to Mortgagee and be written by insurance companies
having an A.M. Best Company, Inc. rating of A or higher and a financial size
category of not less than XII, or otherwise as approved by Mortgagee. Liability
insurance policies shall name Mortgagee as an additional insured and contain a
waiver of subrogation against Mortgagee; all such policies shall indemnify and
hold Mortgagee harmless from all liability claims occurring on, in or about the
Premises and the adjoining streets, sidewalks and passageways. The amounts of
each insurance policy and the form of each such policy shall at all times be
satisfactory to Mortgagee. Each policy shall expressly provide that any
proceeds which are payable to Mortgagee shall be paid by check payable to the
order of Mortgagee only and requiring the endorsement of Mortgagee only. If any
required insurance shall expire, be withdrawn, become void by breach of any
condition thereof by Mortgagor or by any lessee of any part of the Mortgaged
Property or become void or unsafe by reason of the failure or impairment of the
capital of any insurer, or if for any other reason whatsoever such insurance
shall become unsatisfactory to Mortgagee (based on the standards set forth
herein), Mortgagor shall immediately obtain new or additional insurance
satisfactory to Mortgagee (based on the standards set forth herein). Mortgagor
shall not take out any separate or additional insurance which is contributing in
the event of loss unless it is properly endorsed and otherwise satisfactory to
Mortgagee in all respects.
(b) Mortgagor shall deliver to Mortgagee an original of each
insurance policy required to be maintained, or a certificate of such insurance
reasonably acceptable to Mortgagee, together with a copy of the declaration page
for each such policy. Mortgagor shall (i) pay as they become due all premiums
for such
XX-11
insurance, (ii) not later than 15 days prior to the expiration of each policy
to be furnished pursuant to the provisions of this Section, deliver a renewed
policy or policies, or duplicate original or originals thereof, marked
"premium paid," or accompanied by such other evidence of payment satisfactory
to Mortgagee with standard non-contributory mortgage clauses in favor of and
reasonably acceptable to Mortgagee. Upon request of Mortgagee, Mortgagor
shall cause its insurance underwriter or broker to certify to Mortgagee in
writing that all the requirements of this Mortgage governing insurance have
been satisfied.
(c) If Mortgagor is in default of its obligations to insure or
deliver any such prepaid policy or policies, then Mortgagee, at its option and
without notice, may effect such insurance from year to year, and pay the premium
or premiums therefor, and Mortgagor shall pay to Mortgagee on demand such
premium or premiums so paid by Mortgagee with interest from the time of payment
at the Default Rate and the same shall be deemed to be secured by this Mortgage
and shall be collectible in the same manner as the Indebtedness secured by this
Mortgage.
(d) Mortgagor shall increase the amount of property insurance
required to equal 100% replacement cost pursuant to the provisions of this
Section at the time of each renewal of each policy (but not later than 12 months
from the date of this Mortgage and each successive 12 month period to occur
thereafter) by using the X.X. Xxxxx Building Index to determine whether there
shall have been an increase in the replacement value since the most recent
adjustment and, if there shall have been such an increase, the amount of
insurance required shall be adjusted accordingly.
(e) Mortgagor promptly shall comply with and conform to (i) all
provisions of each such insurance policy, and (ii) all requirements of the
insurers applicable to Mortgagor or to any of the Mortgaged Property or to the
use, manner of use, occupancy, possession, operation, maintenance, alteration or
repair of any of the Mortgaged Property. Mortgagor shall not use or permit the
use of the Mortgaged Property in any manner which would permit any insurer to
cancel any insurance policy or void coverage required to be maintained by this
Mortgage.
(f) If the Mortgaged Property, or any part thereof, shall be
destroyed or damaged by fire or any other casualty, whether insured or
uninsured, or in the event any claim is made against Mortgagor for any personal
injury, bodily injury or property damage incurred on or about the Premises,
Mortgagor shall give immediate notice thereof to Mortgagee. If the Mortgaged
Property is damaged by fire or other casualty and the cost to repair such damage
is less than the lesser of (i) 30% of the replacement cost of the Improvements
at the affected Real Estate site and (ii) $2,000,000, then provided that no
Event of Default shall have occurred and be continuing, Mortgagor shall have
the right to adjust such loss, and the insurance proceeds relating to such loss
may be paid over to Mortgagor; provided that Mortgagor shall, promptly after any
such damage, repair all such damage
XX-12
regardless of whether any insurance proceeds have been received or whether
such proceeds, if received, are sufficient to pay for the costs of repair.
If the Mortgaged Property is damaged by fire or other casualty, and the cost
to repair such damage exceeds the above limit, or if an Event of Default
shall have occurred and be continuing, then Mortgagor authorizes and empowers
Mortgagee, at Mortgagee's option and in Mortgagee's sole discretion, as
attorney-in-fact for Mortgagor, to make proof of loss, to adjust and
compromise any claim under any insurance policy, to appear in and prosecute
any action arising from any policy, to collect and receive insurance proceeds
after consultation with Mortgagor, and to deduct therefrom Mortgagee's
reasonable expenses incurred in the collection process. Each insurance
company concerned is hereby authorized and directed to make payment for such
loss directly to Mortgagee. Mortgagee shall have the right to require
Mortgagor to repair or restore the Mortgaged Property, and Mortgagor hereby
designates Mortgagee as its attorney-in-fact for the purpose of making any
election required or permitted under any insurance policy relating to repair
or restoration. The insurance proceeds or any part thereof received by
Mortgagee may be applied by Mortgagee toward reimbursement of all reasonable
costs and expenses of Mortgagee in collecting such proceeds, and the balance,
at Mortgagee's option in its sole and absolute discretion, to the principal
(to the installments in inverse order of maturity, if payable in
installments) and interest due or to become due under the Notes, the Credit
Agreement or the other Loan Documents, to fulfill any other Obligation of
Mortgagor, to the restoration or repair of the property damaged, or released
to Mortgagor. In the event Mortgagee elects to release such proceeds to
Mortgagor, Mortgagor shall be obligated to use such proceeds to restore or
repair the Mortgaged Property. Application by Mortgagee of any insurance
proceeds toward the last maturing installments of principal and interest due
or to become due on the Loans shall not excuse Mortgagor from making any
regularly scheduled payments due thereunder, nor shall such application
extend or reduce the amount of such payments.
(g) In the event of foreclosure of this Mortgage or other transfer of
title to the Mortgaged Property in extinguishment of the Indebtedness, all
right, title and interest of Mortgagor in and to any insurance policies then in
force shall pass to the purchaser or grantee and Mortgagor hereby appoints
Mortgagee its attorney-in-fact, in Mortgagor's name, to assign and transfer all
such policies and proceeds to such purchaser or grantee.
(h) Upon written notice to Mortgagor, Mortgagee after an Event of
Default shall be entitled to require Mortgagor to pay monthly in advance to
Mortgagee the equivalent of 1/12th of the estimated annual premiums due on such
insurance. Mortgagee shall keep such funds in a separate account and Mortgagor
shall not be entitled to interest thereon. Mortgagee shall use such funds to
pay the annual premiums as they become due and any funds remaining may be
applied by Mortgagee, in its sole discretion, to the Indebtedness in reverse
order of Maturity.
XX-13
(i) Mortgagor may maintain insurance required under this Mortgage by
means of one or more blanket insurance policies maintained by Mortgagor;
provided, however, that (A) any such policy shall specify, or Mortgagor shall
furnish to Mortgagee a written statement from the insurer so specifying, the
maximum amount of the total insurance afforded by such blanket policy that is
allocated to the Premises and the other Mortgaged Property and any sublimits in
such blanket policy applicable to the Premises and the other Mortgaged Property,
(B) each such blanket policy shall include an endorsement providing that, in the
event of a loss resulting from an insured peril, insurance proceeds shall be
allocated to the Mortgaged Property in an amount equal to the coverages required
to be maintained by Mortgagor as provided above and (C) the protection afforded
under any such blanket policy shall be no less than that which would have been
afforded under a separate policy or policies relating only to the Mortgaged
Property.
0.6 Restrictions on Liens and Encumbrances. Except for the lien of
this Mortgage, the Liens permitted under the Credit Agreement and the Permitted
Exceptions, Mortgagor shall not further mortgage, nor otherwise encumber the
Mortgaged Property nor create or suffer to exist any lien, charge or encumbrance
on the Mortgaged Property, or any part thereof, whether superior or subordinate
to the lien of this Mortgage and whether recourse or non-recourse.
0.7 Due on Sale and Other Transfer Restrictions. Except as may be
permitted in the Credit Agreement, Mortgagor shall not sell, transfer, convey or
assign all or any portion of, or any interest in, the Mortgaged Property.
0.8 Maintenance; No Alteration; Inspection; Utilities. (a) Mortgagor
shall maintain or cause to be maintained all the Improvements in good condition
and repair and shall not commit or suffer any waste of the Improvements.
Mortgagor shall repair, restore, replace or rebuild promptly any part of the
Premises which may be damaged or destroyed by any casualty whatsoever. The
Improvements shall not be demolished or materially altered, nor any material
additions built, without the prior written consent of Mortgagee, which, with
respect to alterations or additions that do not materially and adversely affect
the value of the Mortgaged Property or, in Mortgagee's discretion, interfere
with the ongoing operations of the business conducted on the Mortgaged Property,
will not be unreasonably withheld.
(b) Mortgagee and any persons authorized by Mortgagee shall have the
right to enter and inspect the Premises during normal business hours and the
right to inspect all work done, labor performed and materials furnished in and
about the Improvements and the right to inspect and make copies of all books,
contracts and records of Mortgagor relating to the ownership and operation of
the Mortgaged Property.
(c) Mortgagor shall pay or cause to be paid when due all utility
charges which are incurred for gas, electricity, water or sewer services
furnished to the Premises and all other
XX-14
assessments or charges of a similar nature, whether public or private,
affecting the Premises or any portion thereof, whether or not such
assessments or charges are liens thereon.
0.9 Condemnation/Eminent Domain. Immediately upon obtaining knowledge
of the institution of any proceedings for the condemnation of the Mortgaged
Property, or any portion thereof, Mortgagor will notify Mortgagee of the
pendency of such proceedings. Mortgagor authorizes Mortgagee, at Mortgagee's
option and in Mortgagee's sole discretion, as attorney-in-fact for Mortgagor, to
commence, appear in and prosecute, in Mortgagee's or Mortgagor's name, any
action or proceeding relating to any condemnation of the Mortgaged Property, or
any portion thereof, and to settle or compromise any claim in connection with
such condemnation. If Mortgagee elects not to participate in such condemnation
proceeding, then Mortgagor shall, at its expense, diligently prosecute any such
proceeding and shall consult with Mortgagee, its attorneys and experts and
cooperate with them in any defense of any such proceedings. All awards and
proceeds of condemnation shall be assigned to Mortgagee to be applied in the
same manner as insurance proceeds, as provided above, and Mortgagor agrees to
execute any such assignments of all such awards as Mortgagee may request.
0.10 Restoration. If Mortgagee elects to release funds to Mortgagor
for restoration of any of the Mortgaged Property, then such restoration shall be
performed only in accordance with the following conditions:
(i) prior to the commencement of any restoration, the plans and
specifications for such restoration, and the budgeted costs, shall be
submitted to and approved by Mortgagee which approval shall not be
unreasonably withheld;
(ii) prior to making any advance of restoration funds, Mortgagee shall
be satisfied that the remaining restoration funds, together with
Mortgagor's own funds from insurance or otherwise, are sufficient to
complete the restoration and to pay all related expenses, including
interest on the Indebtedness and real estate taxes on the Premises, during
restoration;
(iii) at the time of any disbursement of the restoration funds, (A) no
Event of Default (as defined below) shall then have occurred, (B) no
mechanics' or materialmen's liens shall have been filed and remain
undischarged, except those to be discharged by the disbursement of the
requested restoration funds and (C) a satisfactory bring-down or
continuation of title insurance on the Premises shall be delivered to
Mortgagee;
(iv) disbursements shall be made from time to time in an amount not
exceeding the cost of the work completed since the last disbursement, upon
Mortgagee's receipt of reasonably satisfactory evidence from Mortgagor (or
its architect or contractor) of the stage of completion and of performance
of
XX-15
the work in a good and workmanlike manner and in accordance with the
contracts, plans and specifications acceptable to Mortgagee;
(v) with respect to each advance of restoration funds, Mortgagee may
retain 10% of the amount of such advance as a holdback until the
restoration is fully completed;
(vi) the restoration funds shall bear no interest and may be
commingled with Mortgagee's other funds;
(vii) Mortgagee may impose such other reasonable conditions as are
customarily imposed by construction lenders; and
(viii) any restoration funds remaining shall be retained by Mortgagee
and may be applied by Mortgagee, in its sole discretion, to the
Indebtedness in the inverse order of maturity.
0.11 Leases. (a) Mortgagor shall not (i) execute an assignment or
pledge of any Lease relating to all or any portion of the Mortgaged Property
other than in favor of Mortgagee, or (ii) without the prior written consent of
Mortgagee, execute or permit to exist any Lease of any of the Mortgaged
Property.
(b) As to any Lease consented to by Mortgagee, Mortgagor shall:
(i) promptly perform all of the provisions of the Lease on the part
of the lessor thereunder to be performed;
(ii) promptly enforce all of the provisions of the Lease on the part
of the lessee thereunder to be performed;
(iii) appear in and defend any action or proceeding arising under or
in any manner connected with the Lease or the obligations of Mortgagor as
lessor or of the lessee thereunder;
(iv) exercise, within 5 business days after a request by Mortgagee,
any right contained in the Lease to request from the lessee a certificate
with respect to the status thereof;
(v) simultaneously deliver to Mortgagee copies of any notices of
default which Mortgagor may at any time forward to or receive from the
lessee;
(vi) promptly deliver to Mortgagee a fully executed counterpart of
the Lease; and
(vii) promptly deliver to Mortgagee, upon Mortgagee's request, an
assignment of the Mortgagor's interest under such Lease.
(c) Mortgagor shall deliver to Mortgagee, within 10 days after a
request by Mortgagee, a written statement, certified by Mortgagor as being true,
correct and complete, containing the names of all lessees and other occupants of
the Mortgaged
XX-16
Property, the terms of all Leases and the spaces occupied and rentals payable
thereunder, and a list of all Leases which are then in default, including the
nature and magnitude of the default; such statement shall be accompanied by
credit information with respect to the lessees and such other information as
Mortgagee may request.
(d) All Leases entered into by Mortgagor after the date hereof, if
any, and all rights of any lessees thereunder shall be subject and subordinate
in all respects to the lien and provisions of this Mortgage unless Mortgagee
shall otherwise elect in writing.
(e) As to any Lease now in existence or subsequently consented to by
Mortgagee, except to the extent expressly provided for in such Lease, Mortgagor
shall not accept a surrender or terminate, cancel, rescind, supplement, alter,
revise, modify or amend such Lease or permit any such action to be taken nor
shall Mortgagor accept the payment of rent more than thirty (30) days in advance
of its due date.
(f) Each Lease entered into after the date hereof shall provide that
any act or omission of Mortgagor that would give any lessee the right,
immediately or after lapse of a period of time, to cancel or terminate such
Lease, or to xxxxx or offset against the payment of rent or to claim a partial
or total eviction, such lessee shall not exercise such right until it has given
written notice of such act or omission to Mortgagee and until a reasonable
period for remedying such act or omission shall have elapsed following the
giving of such notice without a remedy being effected.
(g) Each Lease entered into after the date hereof shall provide that
in the event of the enforcement by Mortgagee of any remedy under this Mortgage,
the lessee shall, if requested by Mortgagee or any other person succeeding to
the interest of Mortgagee as a result of such enforcement, attorn to Mortgagee
or to such person and shall recognize Mortgagee or such successor in interest as
lessor under the Lease without change in the provisions thereof; provided,
however, that Mortgagee or such successor in interest shall not be: (i) bound
by any payment of an installment of rent or additional rent which may have been
made more than 30 days before the due date of such installment; (ii) bound by
any amendment or modification to the Lease made without the consent of Mortgagee
or such successor in interest; (iii) liable for any previous act or omission of
Mortgagor (or its predecessors in interest); (iv) responsible for any monies
owing by Mortgagor to the credit of such lessee or subject to any credits,
offsets, claims, counterclaims, demands or defenses which the lessee may have
against Mortgagor (or its predecessors in interest); (v) bound by any covenant
to undertake or complete any construction of the Premises or any portion
thereof; or (vi) obligated to make any payment to such lessee other than any
security deposit actually delivered to Mortgagee or such successor in interest.
Each lessee or other occupant, upon request by Mortgagee or such successor in
interest, shall execute
XX-17
and deliver an instrument or instruments confirming such attornment. To the
extent permitted by law, subsections (d)-(g) of this Section shall be
self-operative and any failure of any Lease to include such language shall
not impair the binding effect of such provisions on any lessee under such
Lease.
0.12 Further Assurances. To further assure Mortgagee's rights under
this Mortgage, Mortgagor agrees upon demand of Mortgagee to do any act or
execute any additional documents (including, but not limited to, security
agreements on any personalty included or to be included in the Mortgaged
Property and a separate assignment of each Lease in recordable form) as may
reasonably be required by Mortgagee to confirm the lien of this Mortgage and all
other rights or benefits conferred on Mortgagee.
0.13 Mortgagee's Right to Perform. If Mortgagor fails to perform any
of the covenants or agreements of Mortgagor within the time period provided
herein for such performance, Mortgagee, without waiving or releasing Mortgagor
from any obligation or default under this Mortgage, may, at any time (but shall
be under no obligation to) pay or perform the same, and the amount or cost
thereof, with interest at the Default Rate, shall immediately be due from
Mortgagor to Mortgagee and the same shall be secured by this Mortgage and shall
be a lien on the Mortgaged Property prior to any right, title to, interest in or
claim upon the Mortgaged Property attaching subsequent to the lien of this
Mortgage. No payment or advance of money by Mortgagee under this Section shall
be deemed or construed to cure Mortgagor's default or waive any right or remedy
of Mortgagee.
0.14 Events of Default. The occurrence of an Event of Default under
the Credit Agreement shall constitute an Event of Default hereunder.
0.15 Remedies.
(a) Upon the occurrence of any Event of Default, in addition to any
other rights and remedies Mortgagee may have pursuant to the Loan Documents, or
as provided by law, and without limitation, the Indebtedness and all other
amounts payable with respect to the Loans, the Letters of Credit, the Credit
Agreement, this Mortgage, the other Security Documents and the other Loan
Documents shall become due and payable as provided in the Credit Agreement.
Except as expressly provided above in this Section, presentment, demand, protest
and all other notices of any kind are hereby expressly waived. In addition,
upon the occurrence of any Event of Default, Mortgagee may immediately take such
action, without notice or demand (to the extent permitted by law), as it deems
advisable to protect and enforce its rights against Mortgagor and in and to the
Mortgaged Property, including, but not limited to, the following actions, each
of which may be pursued concurrently or otherwise, at such time and in such
manner as Mortgagee may determine, in its sole discretion, without impairing or
otherwise affecting the other rights and remedies of Mortgagee:
XX-18
(i) Mortgagee may, to the extent permitted by applicable law, (A)
institute and maintain an action of mortgage foreclosure against all or any
part of the Mortgaged Property, (B) institute and maintain an action on the
Notes, the Credit Agreement or any other Loan Document, (C) sell all or
part of the Mortgaged Property (Mortgagor expressly granting to Mortgagee
the power of sale), or (D) take such other action at law or in equity for
the enforcement of this Mortgage or any of the Loan Documents as the law
may allow. Mortgagee may proceed in any such action to final judgment and
execution thereon for all sums due hereunder, together with interest
thereon at the Default Rate and all costs of suit, including, without
limitation, reasonable attorneys' fees and disbursements. Interest at the
Default Rate shall be due on any judgment obtained by Mortgagee from the
date of judgment until actual payment is made of the full amount of the
judgment.
(ii) Mortgagee may personally, or by its agents, attorneys and
employees and without regard to the adequacy or inadequacy of the Mortgaged
Property or any other collateral as security for the Indebtedness and
Obligations enter into and upon the Mortgaged Property and each and every
part thereof and exclude Mortgagor and its agents and employees therefrom
without liability for trespass, damage or otherwise (Mortgagor hereby
agreeing to surrender possession of the Mortgaged Property to Mortgagee
upon demand at any such time) and use, operate, manage, maintain and
control the Mortgaged Property and every part thereof. Following such
entry and taking of possession, Mortgagee shall be entitled, without
limitation, (x) to lease all or any part or parts of the Mortgaged Property
for such periods of time and upon such conditions as Mortgagee may, in its
discretion, deem proper, (y) to enforce, cancel or modify any Lease and (z)
generally to execute, do and perform any other act, deed, matter or thing
concerning the Mortgaged Property as Mortgagee shall deem appropriate as
fully as Mortgagor might do.
(b) The holder of this Mortgage, in any action to foreclose it, shall
be entitled to the appointment of a receiver. In case of a foreclosure sale,
the Real Estate may be sold, at Mortgagee's election, in one parcel or in more
than one parcel and Mortgagee is specifically empowered, (without being required
to do so, and in its sole and absolute discretion) to cause successive sales of
portions of the Mortgaged Property to be held.
(c) In the event of any breach of any of the covenants, agreements,
terms or conditions contained in this Mortgage, and notwithstanding to the
contrary any exculpatory or non-recourse language which may be contained herein,
Mortgagee shall be entitled to enjoin such breach and obtain specific
performance of any covenant, agreement, term or condition and Mortgagee shall
have the right to invoke any equitable right or remedy as though other remedies
were not provided for in this Mortgage.
0.16 Right of Mortgagee to Credit Sale. Upon the
XX-19
occurrence of any sale made under this Mortgage, whether made under the power
of sale or by virtue of judicial proceedings or of a judgment or decree of
foreclosure and sale, Mortgagee may bid for and acquire the Mortgaged
Property or any part thereof. In lieu of paying cash therefor, Mortgagee may
make settlement for the purchase price by crediting upon the Indebtedness or
other sums secured by this Mortgage the net sales price after deducting
therefrom the expenses of sale and the cost of the action and any other sums
which Mortgagee is authorized to deduct under this Mortgage. In such event,
this Mortgage, the Notes, the Credit Agreement, the other Loan Documents and
documents evidencing expenditures secured hereby may be presented to the
person or persons conducting the sale in order that the amount so used or
applied may be credited upon the Indebtedness as having been paid.
0.17 Appointment of Receiver. If an Event of Default shall have
occurred and be continuing, Mortgagee as a matter of right and without notice to
Mortgagor, unless otherwise required by applicable law, and without regard to
the adequacy or inadequacy of the Mortgaged Property or any other collateral as
security for the Indebtedness and Obligations or the interest of Mortgagor
therein, shall have the right to apply to any court having jurisdiction to
appoint a receiver or receivers or other manager of the Mortgaged Property. Any
such receiver or receivers shall have all the usual powers and duties of
receivers in like or similar cases and all the powers and duties of Mortgagee in
case of entry as provided in this Mortgage, including, without limitation and to
the extent permitted by law, the right to enter into leases of all or any part
of the Mortgaged Property, and shall continue as such and exercise all such
powers until the date of confirmation of sale of the Mortgaged Property unless
such receivership is sooner terminated.
0.18 Extension, Release, etc. (a) Without affecting the lien or
charge of this Mortgage upon any portion of the Mortgaged Property not then or
theretofore released as security for the full amount of the Indebtedness,
Mortgagee may, from time to time and without notice, agree to (i) release any
person liable for the Indebtedness, (ii) extend the maturity or alter any of the
terms of the Indebtedness or any guaranty thereof, (iii) grant other
indulgences, (iv) release or reconvey, or cause to be released or reconveyed, at
any time at Mortgagee's option any parcel, portion or all of the Mortgaged
Property, (v) take or release any other or additional security for any
obligation herein mentioned, or (vi) make compositions or other arrangements
with debtors in relation thereto. If at any time this Mortgage shall secure
less than all of the principal amount of the Indebtedness, it is expressly
agreed that any repayments of the principal amount of the Indebtedness shall not
reduce the amount of the lien of this Mortgage until the lien amount shall equal
the principal amount of the Indebtedness outstanding.
(b) No recovery of any judgment by Mortgagee and no levy of an
execution under any judgment upon the Mortgaged Property or upon any other
property of Mortgagor shall affect the lien of this Mortgage or any liens,
rights, powers or remedies of
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Mortgagee hereunder, and such liens, rights, powers and remedies shall
continue unimpaired.
(c) If Mortgagee shall have the right to foreclose this Mortgage,
Mortgagor authorizes Mortgagee at its option to foreclose the lien of this
Mortgage subject to the rights of any tenants of the Mortgaged Property. The
failure to make any such tenants parties defendant to any such foreclosure
proceeding and to foreclose their rights will not be asserted by Mortgagor as a
defense to any proceeding instituted by Mortgagee to collect the Indebtedness or
to foreclose the lien of this Mortgage.
(d) Unless expressly provided otherwise, in the event that ownership
of this Mortgage and title to the Mortgaged Property or any estate therein shall
become vested in the same person or entity, this Mortgage shall not merge in
such title but shall continue as a valid lien on the Mortgaged Property for the
amount secured hereby.
0.19 Security Agreement under Uniform Commercial Code. (a) It is the
intention of the parties hereto that this Mortgage shall constitute a Security
Agreement within the meaning of the Uniform Commercial Code (the "Code")of the
State in which the Mortgaged Property is located. If an Event of Default shall
occur under this Mortgage, then in addition to having any other right or remedy
available at law or in equity, Mortgagee shall have the option of either (i)
proceeding under the Code and exercising such rights and remedies as may be
provided to a secured party by the Code with respect to all or any portion of
the Mortgaged Property which is personal property (including, without
limitation, taking possession of and selling such property) or (ii) treating
such property as real property and proceeding with respect to both the real and
personal property constituting the Mortgaged Property in accordance with
Mortgagee's rights, powers and remedies with respect to the real property (in
which event the default provisions of the Code shall not apply). If Mortgagee
shall elect to proceed under the Code, then five business days' notice of sale
of the personal property shall be deemed reasonable notice and the reasonable
expenses of retaking, holding, preparing for sale, selling and the like incurred
by Mortgagee shall include, but not be limited to, reasonable attorneys' fees
and legal expenses. At Mortgagee's request, Mortgagor shall assemble the
personal property and make it available to Mortgagee at a place designated by
Mortgagee which is reasonably convenient to both parties.
(b) Mortgagor and Mortgagee agree, to the extent permitted by law,
that: (i) all of the goods described within the definition of the word
"Equipment" are or are to become fixtures on the Real Estate; (ii) this Mortgage
upon recording or registration in the real estate records of the proper office
shall constitute a financing statement filed as a "fixture filing" within the
meaning of Sections 9-313 and 9-402 of the Code; (iii) Mortgagor is the record
owner of the Real Estate; and (iv) the addresses of Mortgagor and Mortgagee are
as set forth on the first page of this Mortgage.
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(c) Mortgagor, upon request by Mortgagee from time to time, shall
execute, acknowledge and deliver to Mortgagee one or more separate security
agreements, in form satisfactory to Mortgagee, covering all or any part of the
Mortgaged Property and will further execute, acknowledge and deliver, or cause
to be executed, acknowledged and delivered, any financing statement, affidavit,
continuation statement or certificate or other document as Mortgagee may
reasonably request in order to perfect, preserve, maintain, continue or extend
the security interest under and the priority of this Mortgage and such security
instrument. Mortgagor further agrees to pay to Mortgagee on demand all
reasonable costs and expenses incurred by Mortgagee in connection with the
preparation, execution, recording, filing and re-filing of any such document and
all reasonable costs and expenses of any record searches for financing
statements Mortgagee shall reasonably require. Mortgagor shall from time to
time, on request of Mortgagee, deliver to Mortgagee an inventory in reasonable
detail of any of the Mortgaged Property which constitutes personal property. If
Mortgagor shall fail to furnish any financing or continuation statement required
hereunder within 10 business days after request by Mortgagee, then pursuant to
the provisions of the Code, Mortgagor hereby authorizes Mortgagee, without the
signature of Mortgagor, to execute and file any such financing and continuation
statements. The filing of any financing or continuation statements in the
records relating to personal property or chattels shall not be construed as in
any way impairing the right of Mortgagee to proceed against any personal
property encumbered by this Mortgage as real property, as set forth above.
0.20 Assignment of Rents. Mortgagor hereby assigns to Mortgagee the
Rents as further security for the payment of the Indebtedness and performance of
the Obligations, and Mortgagor grants to Mortgagee the right to enter the
Mortgaged Property for the purpose of collecting the same and to let the
Mortgaged Property or any part thereof, and to apply the Rents on account of the
Indebtedness. The foregoing assignment and grant is present and absolute and
shall continue in effect until the Indebtedness is paid in full, but Mortgagee
hereby waives the right to enter the Mortgaged Property for the purpose of
collecting the Rents and Mortgagor shall be entitled to collect, receive, use
and retain the Rents until the occurrence of an Event of Default under this
Mortgage; such right of Mortgagor to collect, receive, use and retain the Rents
may be revoked by Mortgagee upon the occurrence of any Event of Default under
this Mortgage by giving not less than five business days' written notice of such
revocation to Mortgagor; in the event such notice is given, Mortgagor shall pay
over to Mortgagee, or to any receiver appointed to collect the Rents, any lease
security deposits, and shall pay monthly in advance to Mortgagee, or to any such
receiver, the fair and reasonable rental value as determined by Mortgagee for
the use and occupancy of the Mortgaged Property or of such part thereof as may
be in the possession of Mortgagor or any affiliate of Mortgagor, and upon
default in any such payment Mortgagor and any such affiliate will vacate and
surrender the possession of the Mortgaged Property to
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Mortgagee or to such receiver, and in default thereof may be evicted by
summary proceedings or otherwise. Mortgagor shall not accept prepayments of
installments of Rent to become due for a period of more than one month in
advance (except for security deposits and estimated payments of percentage
rent, if any).
0.21 Trust Funds. All lease security deposits of the Real Estate
shall be treated as trust funds not to be commingled with any other funds of
Mortgagor. Within 10 days after request by Mortgagee, Mortgagor shall furnish
Mortgagee satisfactory evidence of compliance with this subsection, together
with a statement of all lease security deposits by lessees and copies of all
Leases not previously delivered to Mortgagee, which statement shall be certified
by Mortgagor.
0.22 Additional Rights. The holder of any subordinate lien on the
Mortgaged Property shall have no right to terminate any Lease whether or not
such Lease is subordinate to this Mortgage nor shall any holder of any
subordinate lien join any tenant under any Lease in any action to foreclose the
lien or modify, interfere with, disturb or terminate the rights of any tenant
under any Lease. By recordation of this Mortgage all subordinate lienholders
are subject to and notified of this provision, and any action taken by any such
lienholder contrary to this provision shall be null and void. Upon the
occurrence of any Event of Default, Mortgagee may, in its sole discretion and
without regard to the adequacy of its security under this Mortgage, apply all or
any part of any amounts on deposit with Mortgagee under this Mortgage against
all or any part of the Indebtedness. Any such application shall not be
construed to cure or waive any Default or Event of Default or invalidate any act
taken by Mortgagee on account of such Default or Event of Default.
0.23 Changes in Method of Taxation. In the event of the passage after
the date hereof of any law of any Governmental Authority deducting from the
value of the Premises for the purposes of taxation any lien thereon, or changing
in any way the laws for the taxation of mortgages or debts secured thereby for
federal, state or local purposes, or the manner of collection of any such taxes,
and imposing a tax, either directly or indirectly, on mortgages or debts secured
thereby, the holder of this Mortgage shall have the right to declare the
Indebtedness due on a date to be specified by not less than 30 business days'
written notice to be given to Mortgagor unless within such 30 business day
period Mortgagor shall assume as an Obligation hereunder the payment of any tax
so imposed until full payment of the Indebtedness and such assumption shall be
permitted by law.
0.24 Notices. All notices, requests, demands and other communications
hereunder shall be deemed to have been sufficiently given or served when served
in the manner set forth in Section 10.8 of the Credit Agreement.
0.25 No Oral Modification. This Mortgage may not be changed or
terminated orally. Any agreement made by Mortgagor
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and Mortgagee after the date of this Mortgage relating to this Mortgage shall
be superior to the rights of the holder of any intervening or subordinate
lien or encumbrance.
0.26 Partial Invalidity. In the event any one or more of the
provisions contained in this Mortgage shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision hereof, but each shall be
construed as if such invalid, illegal or unenforceable provision had never been
included. Notwithstanding anything to the contrary contained in this Mortgage
or in any provisions of the Indebtedness or Loan Documents, the obligations of
Mortgagor and of any other obligor under the Indebtedness or Loan Documents
shall be subject to the limitation that Mortgagee shall not charge, take or
receive, nor shall Mortgagor or any other obligor be obligated to pay to
Mortgagee, any amounts constituting interest in excess of the maximum rate
permitted by law to be charged by Mortgagee.
0.27 Mortgagor's Waiver of Rights. To the fullest extent permitted by
law, Mortgagor waives the benefit of all laws now existing or that may
subsequently be enacted providing for (i) any appraisement before sale of any
portion of the Mortgaged Property, (ii) any extension of the time for the
enforcement of the collection of the Indebtedness or the creation or extension
of a period of redemption from any sale made in collecting such debt and (iii)
exemption of the Mortgaged Property from attachment, levy or sale under
execution or exemption from civil process. To the full extent Mortgagor may do
so, Mortgagor agrees that Mortgagor will not at any time insist upon, plead,
claim or take the benefit or advantage of any law now or hereafter in force
providing for any appraisement, valuation, stay, exemption, extension or
redemption, or requiring foreclosure of this Mortgage before exercising any
other remedy granted hereunder and Mortgagor, for Mortgagor and its successors
and assigns, and for any and all persons ever claiming any interest in the
Mortgaged Property, to the extent permitted by law, hereby waives and releases
all rights of redemption, valuation, appraisement, stay of execution, notice of
election to mature or declare due the whole of the secured indebtedness and
marshalling in the event of foreclosure of the liens hereby created. Mortgagor
further waives, to the extent permitted by applicable law, all notices of any
Event of Default (except as may be provided for under the terms of this
Mortgage) or of Mortgagee's election to exercise or its actual exercise of any
right, remedy or recourse provided for under this Mortgage.
0.28 Remedies Not Exclusive. Mortgagee shall be entitled to enforce
payment of the Indebtedness and performance of the Obligations and to exercise
all rights and powers under this Mortgage or under any of the other Loan
Documents or other agreement or any laws now or hereafter in force,
notwithstanding some or all of the Indebtedness and Obligations may now or
hereafter be otherwise secured, whether by mortgage, security agreement, pledge,
lien, assignment or otherwise. Neither the acceptance of this Mortgage nor its
enforcement, shall prejudice or in any manner affect Mortgagee's right to
realize upon or
XX-24
enforce any other security now or hereafter held by Mortgagee, it being
agreed that Mortgagee shall be entitled to enforce this Mortgage and any
other security now or hereafter held by Mortgagee in such order and manner as
Mortgagee may determine in its absolute discretion. No remedy herein
conferred upon or reserved to Mortgagee is intended to be exclusive of any
other remedy herein or by law provided or permitted, but each shall be
cumulative and shall be in addition to every other remedy given hereunder or
now or hereafter existing at law or in equity or by statute. Every power or
remedy given by any of the Loan Documents to Mortgagee or to which it may
otherwise be entitled, may be exercised, concurrently or independently, from
time to time and as often as may be deemed expedient by Mortgagee. In no
event shall Mortgagee, in the exercise of the remedies provided in this
Mortgage (including, without limitation, in connection with the assignment of
Rents to Mortgagee, or the appointment of a receiver and the entry of such
receiver on to all or any part of the Mortgaged Property), be deemed a
"mortgagee in possession," and Mortgagee shall not in any way be made liable
for any act, either of commission or omission, in connection with the
exercise of such remedies.
0.29 Multiple Security. If (a) the Premises shall consist of one or
more parcels, whether or not contiguous and whether or not located in the same
county, or (b) in addition to this Mortgage, Mortgagee shall now or hereafter
hold one or more additional mortgages, liens, deeds of trust or other security
(directly or indirectly) for the Indebtedness upon other property in the State
in which the Premises are located (whether or not such property is owned by
Mortgagor or by others) or (c) both the circumstances described in clauses (a)
and (b) shall be true, then to the fullest extent permitted by law, Mortgagee
may, at its election, commence or consolidate in a single foreclosure action all
foreclosure proceedings against all such collateral securing the Indebtedness
(including the Mortgaged Property), which action may be brought or consolidated
in the courts of any county in which any of such collateral is located.
Mortgagor acknowledges that the right to maintain a consolidated foreclosure
action is a specific inducement to Mortgagee to extend the Indebtedness, and
Mortgagor expressly and irrevocably waives any objections to the commencement or
consolidation of the foreclosure proceedings in a single action and any
objections to the laying of venue or based on the grounds of forum non
conveniens which it may now or hereafter have. Mortgagor further agrees that if
Mortgagee shall be prosecuting one or more foreclosure or other proceedings
against a portion of the Mortgaged Property or against any collateral other than
the Mortgaged Property, which collateral directly or indirectly secures the
Indebtedness, or if Mortgagee shall have obtained a judgment of foreclosure and
sale or similar judgment against such collateral, then, whether or not such
proceedings are being maintained or judgments were obtained in or outside the
State in which the Premises are located, Mortgagee may commence or continue
foreclosure proceedings and exercise its other remedies granted in this Mortgage
against all or any part of the Mortgaged Property and Mortgagor waives any
objections to the commencement
XX-25
or continuation of a foreclosure of this Mortgage or exercise of any other
remedies hereunder based on such other proceedings or judgments, and waives
any right to seek to dismiss, stay, remove, transfer or consolidate either
any action under this Mortgage or such other proceedings on such basis.
Neither the commencement nor continuation of proceedings to foreclose this
Mortgage nor the exercise of any other rights hereunder nor the recovery of
any judgment by Mortgagee in any such proceedings shall prejudice, limit or
preclude Mortgagee's right to commence or continue one or more foreclosure or
other proceedings or obtain a judgment against any other collateral (either
in or outside the State in which the Premises are located) which directly or
indirectly secures the Indebtedness, and Mortgagor expressly waives any
objections to the commencement of, continuation of, or entry of a judgment in
such other proceedings or exercise of any remedies in such proceedings based
upon any action or judgment connected to this Mortgage, and Mortgagor also
waives any right to seek to dismiss, stay, remove, transfer or consolidate
either such other proceedings or any action under this Mortgage on such
basis. It is expressly understood and agreed that to the fullest extent
permitted by law, Mortgagee may, at its election, cause the sale of all
collateral which is the subject of a single foreclosure action at either a
single sale or at multiple sales conducted simultaneously and take such other
measures as are appropriate in order to effect the agreement of the parties
to dispose of and administer all collateral securing the Indebtedness
(directly or indirectly) in the most economical and least time-consuming
manner.
0.30 Successors and Assigns. All covenants of Mortgagor contained in
this Mortgage are imposed solely and exclusively for the benefit of Mortgagee
and its successors and assigns, and no other person or entity shall have
standing to require compliance with such covenants or be deemed, under any
circumstances, to be a beneficiary of such covenants, any or all of which may be
freely waived in whole or in part by Mortgagee at any time if in its sole
discretion it deems such waiver advisable. All such covenants of Mortgagor
shall run with the land and bind Mortgagor, the successors and assigns of
Mortgagor (and each of them) and all subsequent owners, encumbrancers and
tenants of the Mortgaged Property, and shall inure to the benefit of Mortgagee,
its successors and assigns. The word "Mortgagor" shall be construed as if it
read "Mortgagors" whenever the sense of this Mortgage so requires and if there
shall be more than one Mortgagor, the obligations of the Mortgagors shall be
joint and several.
0.31 No Waivers, etc. Any failure by Mortgagee to insist upon the
strict performance by Mortgagor of any of the terms and provisions of this
Mortgage shall not be deemed to be a waiver of any of the terms and provisions
hereof, and Mortgagee, notwithstanding any such failure, shall have the right
thereafter to insist upon the strict performance by Mortgagor of any and all of
the terms and provisions of this Mortgage to be performed by Mortgagor.
Mortgagee may release, regardless of consideration and without the necessity for
any notice to or consent by the holder of any subordinate lien on the Mortgaged
Property, any
XX-26
part of the security held for the obligations secured by this Mortgage
without, as to the remainder of the security, in anyway impairing or
affecting the lien of this Mortgage or the priority of such lien over any
subordinate lien.
0.32 Governing Law, etc. This Mortgage shall be governed by and
construed in accordance with the laws of the State in which the Premises are
located, except that Mortgagor expressly acknowledges that by its terms the
Notes and the Credit Agreement shall be governed and construed in accordance
with the laws of the State of New York, without regard to principles of conflict
of law, and for purposes of consistency, Mortgagor agrees that in any in
personam proceeding related to this Mortgage the rights of the parties to this
Mortgage shall also be governed by and construed in accordance with the laws of
the State of New York governing contracts made and to be performed in that
State, without regard to principles of conflict of law.
0.33 Waiver of Trial by Jury. Mortgagor and Mortgagee each hereby
irrevocably and unconditionally waive trial by jury in any action, claim, suit
or proceeding relating to this Mortgage and for any counterclaim brought
therein. Mortgagor hereby waives all rights to interpose any counterclaim in
any suit brought by Mortgagee hereunder and all rights to have any such suit
consolidated with any separate suit, action or proceeding.
0.34 Certain Definitions. Unless the context clearly indicates a
contrary intent or unless otherwise specifically provided herein, words used in
this Mortgage shall be used interchangeably in singular or plural form and the
word "Mortgagor" shall mean "each Mortgagor or any subsequent owner or owners of
the Mortgaged Property or any part thereof or interest therein," the word
"Mortgagee" shall mean "Mortgagee or any successor Agent," the word "Notes"
shall mean "the Notes or any other evidence of indebtedness secured by this
Mortgage," the word "person" shall include any individual, corporation,
partnership, trust, unincorporated association, government, governmental
authority, or other entity, and the words "Mortgaged Property" shall include any
portion of the Mortgaged Property or interest therein. Whenever the context may
require, any pronouns used herein shall include the corresponding masculine,
feminine or neuter forms, and the singular form of nouns and pronouns shall
include the plural and vice versa. The captions in this Mortgage are for
convenience or reference only and in no way limit or amplify the provisions
hereof.
0.35 Future Advances. This Mortgage is executed and delivered to
secure, among other things, future advances. It is understood and agreed that
this Mortgage secures present and future advances made for the benefit of
Mortgagor and that the lien of such future advances shall relate back to the
date of this Mortgage.
0.36 Open-End Mortgage. This Mortgage is an "Open-End Mortgage" as
set forth in 42 Pa. C.S.A. Section 8143 and secures
XX-27
obligations up to the maximum amount of indebtedness outstanding at any one
time equal to $75,000,000, plus accrued and unpaid interest, including, but
not limited to, advances for the payment of taxes and municipal assessments,
maintenance charges, insurance premiums, costs incurred for the protection of
the Mortgaged Property or the lien of this Mortgage, expenses incurred by
Mortgagee by reason of default by Mortgagor under this Mortgage, the Credit
Agreement, the Notes, the Loans, the Letters of Credit or any other Loan
Documents and advances for construction, alteration or renovation on the
Mortgaged Property or for any other purposes, together with all other sums
due hereunder or secured hereby.
0.37 Receipt of Copy. Mortgagor acknowledges that it has received a
true copy of this Mortgage.
0.38 Release. If Mortgagor shall and does pay to Mortgagee the full
principal amount of the Indebtedness secured hereby, together with all interest
accrued thereon, and keeps all the other covenants and agreements contained
herein and in the Notes, the Credit Agreement and in the other Loan Documents,
all in the manner and at the times set forth herein or in the Notes, the Credit
Agreement and in the other Loan Documents, and if Mortgagor shall also pay all
reasonable satisfaction costs, including, but not limited to, reasonable
attorneys' fees and the cost of recording a satisfaction piece and, if
appropriate, a power-of-attorney to satisfy this Mortgage, then and from
thenceforth this Mortgage and the estate hereby created, granted, transferred
and assigned shall cease and become void.
This Mortgage has been duly executed by Mortgagor on the date first
above written.
ATTEST AURORA FOODS INC.
[corporate seal]
By:______________________ By:_____________________
The address of the within-named Mortgagee is:
The Chase Manhattan Bank, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
For the Mortgagee
___________________________
[Print Name]
XX-00
XXXXX XX XXX XXXX )
ss.:
COUNTY OF NEW YORK )
On this, the _____ day of , 1998, before me, a Notary Public
in and for the State and County aforesaid, the undersigned officer, personally
appeared ____________________, who acknowledged [her] [him]self to be the
[______________________] President of AURORA FOODS INC., a Delaware corporation
and that [s]he, as such officer, being authorized to do so, executed the
foregoing instrument for the purposes therein contained, by signing the name
of the corporation by [her][him]self as such officer.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
______________________________
Notary Public
[Notarial Seal]
My Commission Expires:
XX-29
Schedule A
Description of the Premises
[Attach Legal Description of all parcels]
XX-30
