CREDIT AGREEMENT
Exhibit
10.2
DATED
AS
OF NOVEMBER 3, 2008
AMONG
RC2
CORPORATION,
LEARNING
CURVE BRANDS, INC.,
LEARNING
CURVE CANADA LIMITED,
RC2
(ASIA) LIMITED
RC2
(AUSTRALIA) PTY., LTD.,
RC2
DEUTSCHLAND GMBH,
RACING
CHAMPIONS INTERNATIONAL LIMITED,
RACING
CHAMPIONS WORLDWIDE LIMITED
THE
GUARANTORS FROM TIME TO TIME PARTIES HERETO,
THE
LENDERS FROM TIME TO TIME PARTIES HERETO,
AND
BANK
OF
MONTREAL,
AS
ADMINISTRATIVE AGENT
BMO
CAPITAL MARKETS, AS SOLE LEAD ARRANGER AND SOLE BOOK RUNNER
NATIONAL
CITY BANK, AS SYNDICATION AGENT
TABLE
OF CONTENTS
SECTION | HEADING | PAGE | |
SECTION 1. |
THE
CREDIT FACILITIES
|
1
|
|
Section 1.1.
|
Term
Loan Commitments
|
1
|
|
Section 1.2.
|
Revolving
Credit Commitments
|
1
|
|
Section 1.3.
|
Letters
of Credit
|
2
|
|
Section 1.4.
|
Applicable
Interest Rates
|
5
|
|
Section 1.5.
|
Minimum
Borrowing Amounts; Maximum Eurocurrency Loans
|
6
|
|
Section 1.6.
|
Manner
of Borrowing Loans and Designating Applicable Interest
Rates
|
6
|
|
Section 1.7.
|
Interest
Periods
|
8
|
|
Section 1.8.
|
Maturity
of Loans
|
9
|
|
Section 1.9.
|
Prepayments
|
10
|
|
Section 1.10.
|
Default
Rate
|
11
|
|
Section 1.11.
|
Evidence
of Indebtedness
|
12
|
|
Section 1.12.
|
Funding
Indemnity
|
12
|
|
Section 1.13.
|
Commitment
Terminations
|
13
|
|
Section 1.14.
|
Substitution
of Lenders
|
14
|
|
Section 1.15.
|
Appointment
of the Company as Agent for Borrowers
|
14
|
|
Section 1.16.
|
Swing
Loans
|
14
|
|
Section 1.17.
|
Increase
in Revolving Credit Commitments, Additional Term Loans
|
16
|
|
Section 1.18.
|
Defaulting
Lenders
|
17
|
|
SECTION 2.
|
FEES
|
17
|
|
Section 2.1.
|
Fees
|
17
|
|
SECTION 3.
|
PLACE
AND APPLICATION OF PAYMENTS
|
18
|
|
Section 3.1.
|
Place
and Application of Payments
|
18
|
|
Section 3.2.
|
Account
Debit
|
20
|
|
SECTION 4.
|
THE
COLLATERAL AND GUARANTIES
|
20
|
|
Section 4.1.
|
Collateral
|
20
|
|
Section 4.2.
|
Guaranties
|
21
|
|
Section 4.3
|
Joint
and Several Obligors
|
21
|
|
Section 4.4.
|
Further
Assurances
|
21
|
|
SECTION 5.
|
DEFINITIONS;
INTERPRETATION
|
21
|
|
Section 5.1.
|
Definitions
|
21
|
|
Section 5.2.
|
Interpretation
|
37
|
|
Section 5.3.
|
Change
in Accounting Principles
|
37
|
ii
SECTION 6.
|
REPRESENTATIONS
AND WARRANTIES
|
38
|
|
Section 6.1.
|
Organization
and Qualification
|
38
|
|
Section 6.2.
|
Subsidiaries
|
38
|
|
Section 6.3.
|
Authority
and Validity of Obligations
|
39
|
|
Section 6.4.
|
Use
of Proceeds; Margin Stock
|
39
|
|
Section 6.5.
|
Financial
Reports
|
39
|
|
Section 6.6.
|
No
Material Adverse Change
|
40
|
|
Section 6.7.
|
Full
Disclosure
|
40
|
|
Section 6.8.
|
Trademarks,
Franchises, and Licenses
|
40
|
|
Section 6.9.
|
Governmental
Authority and Licensing
|
40
|
|
Section 6.10.
|
Good
Title
|
40
|
|
Section 6.11.
|
Litigation
and Other Controversies
|
40
|
|
Section 6.12.
|
Taxes
|
41
|
|
Section 6.13.
|
Approvals
|
41
|
|
Section 6.14.
|
Affiliate
Transactions
|
41
|
|
Section 6.15.
|
Investment
Company
|
41
|
|
Section 6.16.
|
ERISA
|
41
|
|
Section 6.17.
|
Compliance
with Laws
|
41
|
|
Section 6.18.
|
Other
Agreements
|
42
|
|
Section
6.19.
|
Solvency
|
42
|
|
Section 6.20.
|
No
Default
|
42
|
|
Section 6.21.
|
No
Broker Fees.
|
42
|
|
SECTION 7.
|
CONDITIONS
PRECEDENT
|
42
|
|
Section 7.1.
|
All
Credit Events
|
42
|
|
Section
7.2.
|
Initial
Credit Event
|
43
|
|
SECTION 8.
|
COVENANTS
|
45
|
|
Section 8.1.
|
Maintenance
of Business
|
45
|
|
Section 8.2.
|
Maintenance
of Properties
|
46
|
|
Section 8.3.
|
Taxes
and Assessments
|
46
|
|
Section 8.4.
|
Insurance
|
46
|
|
Section 8.5.
|
Financial
Reports
|
46
|
|
Section 8.6.
|
Inspection
|
48
|
|
Section 8.7.
|
Borrowings
and Guaranties
|
48
|
|
Section 8.8.
|
Liens
|
49
|
|
Section 8.9.
|
Investments,
Acquisitions, Loans and Advances
|
50
|
|
Section 8.10.
|
Mergers,
Consolidations and Sales
|
52
|
|
Section 8.11.
|
Maintenance
of Subsidiaries
|
52
|
|
Section 8.12.
|
Dividends
and Certain Other Restricted Payments
|
53
|
|
Section 8.13.
|
ERISA
|
53
|
|
Section 8.14.
|
Compliance
with Laws
|
53
|
|
Section 8.15.
|
Burdensome
Contracts With Affiliates
|
54
|
|
Section 8.16.
|
No
Changes in Fiscal Year
|
54
|
|
Section 8.17.
|
Formation
of Subsidiaries
|
54
|
iii
Section 8.18.
|
Change
in the Nature of Business
|
54
|
|
Section 8.19.
|
Use
of Loan Proceeds
|
54
|
|
Section 8.20.
|
No
Restrictions
|
54
|
|
Section 8.21.
|
Financial
Covenants
|
54
|
|
Section 8.22. |
Post
Closing Covenants.
|
55 | |
SECTION 9.
|
EVENTS
OF DEFAULT AND REMEDIES
|
55 | |
Section 9.1.
|
Events
of Default
|
55
|
|
Section 9.2.
|
Non-Bankruptcy
Defaults
|
57
|
|
Section 9.3.
|
Bankruptcy
Defaults
|
58
|
|
Section 9.4.
|
Collateral
for Undrawn Letters of Credit
|
58
|
|
Section 9.5.
|
Notice
of Default
|
59
|
|
Section 9.6.
|
Expenses
|
59
|
|
SECTION 10.
|
CHANGE
IN CIRCUMSTANCES
|
59
|
|
Section 10.1.
|
Change
of Law
|
59
|
|
Section 10.2.
|
Unavailability
of Deposits or Inability to Ascertain, or Inadequacy of,
LIBOR
|
59
|
|
Section 10.3.
|
Increased
Cost and Reduced Return
|
60
|
|
Section 10.4.
|
Lending
Offices
|
61
|
|
Section 10.5.
|
Discretion
of Lender as to Manner of Funding
|
61
|
|
SECTION 11.
|
THE
ADMINISTRATIVE AGENT
|
62
|
|
Section 11.1.
|
Appointment
and Authorization of Administrative Agent
|
62
|
|
Section 11.2.
|
Administrative
Agent and its Affiliates
|
62
|
|
Section 11.3.
|
Action
by Administrative Agent
|
62
|
|
Section 11.4.
|
Consultation
with Experts
|
63
|
|
Section 11.5.
|
Liability
of Administrative Agent; Credit Decision
|
63
|
|
Section 11.6.
|
Indemnity
|
63
|
|
Section 11.7.
|
Resignation
of Administrative Agent and Successor Administrative Agent
|
64
|
|
Section 11.8.
|
L/C
Issuer and Swing Line Lender.
|
64
|
|
Section 11.9.
|
Hedging
Liability and Funds Transfer and Deposit Account Liability
Arrangements
|
65
|
|
Section 11.10.
|
Designation
of Additional Agents
|
65
|
|
Section 11.11.
|
Authorization
to Release or Subordinate or Limit Liens
|
65
|
|
Section 11.12.
|
Authorization
to Enter into, and Enforcement of, the Collateral Documents
|
66
|
|
SECTION 12.
|
THE
GUARANTEES; JOINT AND SEVERAL OBLIGATIONS
|
66
|
|
Section 12.1.
|
The
Guarantees
|
66
|
|
Section 12.2.
|
Guarantee
Unconditional
|
67
|
|
Section 12.3.
|
Discharge
Only upon Payment in Full; Reinstatement in Certain
Circumstances
|
67
|
|
Section 12.4.
|
Subrogation
|
68
|
iv
Section 12.5.
|
Waivers
|
68
|
|
Section 12.6.
|
Limit
on Recovery
|
68
|
|
Section 12.7.
|
Stay
of Acceleration
|
68
|
|
Section 12.8.
|
Benefit
to Guarantors
|
68
|
|
Section
12.9.
|
Guarantor
Covenants
|
69
|
|
Section 12.10.
|
Joint
and Several Obligors
|
69
|
|
SECTION 13.
|
MISCELLANEOUS
|
70
|
|
Section 13.1.
|
Withholding
Taxes
|
70
|
|
Section 13.2.
|
No
Waiver, Cumulative Remedies
|
71
|
|
Section 13.3.
|
Non-Business
Days
|
71
|
|
Section 13.4.
|
Documentary
Taxes
|
71
|
|
Section 13.5.
|
Survival
of Representations
|
71
|
|
Section 13.6.
|
Survival
of Indemnities
|
72
|
|
Section 13.7.
|
Sharing
of Set-Off
|
72
|
|
Section 13.8.
|
Notices
|
72
|
|
Section 13.9.
|
Counterparts
|
73
|
|
Section 13.10.
|
Successors
and Assigns
|
73
|
|
Section 13.11.
|
Participants
|
73
|
|
Section 13.12.
|
Assignments
|
74
|
|
Section 13.13.
|
Amendments
|
76
|
|
Section 13.14.
|
Headings
|
77
|
|
Section 13.15.
|
Costs
and Expenses; Indemnification
|
77
|
|
Section 13.16.
|
Set-off
|
78
|
|
Section 13.17.
|
Entire
Agreement
|
78
|
|
Section 13.18.
|
Governing
Law
|
78
|
|
Section 13.19.
|
Severability
of Provisions
|
79
|
|
Section 13.20.
|
Excess
Interest
|
79
|
|
Section 13.21.
|
Construction
|
79
|
|
Section 13.22.
|
Lender’s
and L/C Issuer’s Obligations Several; Lenders and their
Affiliates
|
80
|
|
Section 13.23.
|
Intentionally
Omitted
|
80
|
|
Section 13.24.
|
Submission
to Jurisdiction; Waiver of Jury Trial
|
80
|
|
Section 13.25.
|
USA
Patriot Act
|
80
|
|
Section 13.26.
|
Confidentiality
|
80
|
|
Signature Page | S-1 |
Exhibit A
|
—
|
Notice
of Payment Request
|
Exhibit B
|
—
|
Notice
of Borrowing
|
Exhibit C
|
—
|
Notice
of Continuation/Conversion
|
Exhibit D-1
|
—
|
Term Note
|
Exhibit D-2
|
—
|
Revolving
Note
|
Exhibit D-3
|
—
|
Swing
Note
|
Exhibit E
|
—
|
Compliance
Certificate
|
Exhibit F
|
—
|
Additional
Guarantor Supplement
|
Exhibit G
|
—
|
Assignment
and Acceptance
|
Exhibit
H
|
—
|
Commitment
Amount Increase Request
|
Schedule
1
|
—
|
Commitments
|
Schedule 6.2
|
—
|
Subsidiaries
|
v
This
Credit Agreement is entered into as of November 3, 2008 by and among RC2
Corporation, a Delaware corporation (the “Company”), Learning Curve
Brands, Inc., a Delaware corporation (“LCBI”), Learning Curve
Canada Limited, a corporation incorporated under the laws xx Xxxxxxx, Xxxxxx
(“LCCL”), RC2 (Asia)
Limited, a company incorporated in Hong Kong (“RC2 Asia”), RC2 (Australia)
Pty., Ltd., a proprietary company duly incorporated in Victoria, Australia
(“RC2 Australia”), RC2
Deutschland GmbH, a private company duly incorporated and registered under
the
laws of Germany (“RC2
Germany”), Racing Champions International Limited, a corporation
organized under the laws of England and Wales (“RC2 UK”), Racing Champions
Worldwide Limited, a corporation organized under the laws of England and Wales
(“Racing Champions”;
and together with the Company, LCBI, LCCL, RC2 Asia, RC2 Australia, RC2 Germany,
RC2 UK, and Racing Champions collectively, the “Borrowers” and individually,
a “Borrower”), the
Subsidiaries of the Company from time to time party to this Agreement, as
Guarantors, the several financial institutions from time to time party to this
Agreement, as Lenders, and Bank of Montreal, as Administrative Agent as provided
herein. All capitalized terms used herein without definition shall
have the same meanings herein as such terms are defined in Section 5.1
hereof.
The
Borrowers have requested, and the Lenders have agreed to extend, certain credit
facilities on the terms and conditions of this Agreement.
Section 1. The
Credit Facilities
Section 1.1. Term
Loan Commitments. Subject to the terms and conditions hereof,
each Lender, by its acceptance hereof, severally agrees to make a loan
(individually a “Term
Loan” and collectively for all the Lenders the “Term Loans”) in
U.S. Dollars to the Borrowers in the amount of such Lender’s Term Loan
Commitment. The Term Loans shall be advanced in a single Borrowing on
the Closing Date and shall be made ratably by the Lenders in proportion to
their
respective Term Loan Percentages, at which time the Term Loan Commitments shall
expire. As provided in Section 1.6(a) hereof, the Company, on
behalf of the Borrowers, may elect that the Term Loans be outstanding as Base
Rate Loans or Eurocurrency Loans. No amount repaid or prepaid on any
Term Loan may be borrowed again.
Section 1.2. Revolving
Credit Commitments. Subject to the terms and conditions
hereof, each Lender, by its acceptance hereof, severally agrees to make a loan
or loans (individually a “Revolving Loan” and
collectively the “Revolving
Loans”) in U.S. Dollars to the Borrowers from time to time on a revolving
basis up to the amount of such Lender’s Revolving Credit Commitment, subject to
any reductions thereof pursuant to the terms hereof, before the Revolving Credit
Termination Date. The sum of the aggregate principal amount of
Revolving Loans,Swing Loans, and L/C Obligations
at
any time outstanding shall not exceed the Revolving Credit Commitments in effect
at such time.
Each
Borrowing of Revolving Loans shall be made ratably by the Lenders in proportion
to their respective Revolver Percentages. As provided in
Section 1.6(a) hereof, the Company, on behalf of the applicable Borrower,
may elect that each Borrowing of Revolving Loans be either Base Rate Loans
or
Eurocurrency Loans. Revolving Loans may be repaid and the principal
amount thereof reborrowed before the Revolving Credit Termination Date, subject
to the terms and conditions hereof.
Section 1.3. Letters
of Credit. (a) General
Terms. Subject to the terms and conditions hereof, as part of
the Revolving Credit, the L/C Issuer shall issue standby letters of credit
(each
a “Letter of Credit”)
for the account of the applicable Borrower of an aggregate undrawn
face
amount up to the L/C Sublimit. Each Letter of Credit shall be issued
by the L/C Issuer, but each Lender shall be obligated to reimburse the L/C
Issuer for such Lender’s Revolver Percentage of the amount of each drawing
thereunder and, accordingly, each Letter of Credit shall constitute usage of
the
Revolving Credit Commitment of each Lender pro rata in an amount equal to its
Revolver Percentage of the L/C Obligations then
outstanding. Notwithstanding anything contained herein to the
contrary, each of the Existing L/Cs shall constitute a “Letter of Credit” herein for
all purposes of this Agreement to the same extent, and with the same force
and
effect, as if the Existing L/Cs had been issued at the request of the Company
hereunder.
(b)
Applications. At
any time before the Revolving Credit Termination Date, the L/C Issuer shall,
at
the request of the Company, which is acting on behalf of the Borrowers, issue
one or more Letters of Credit in U.S. Dollars, in a form satisfactory
to the L/C Issuer, with expiration dates no later than the earlier of 12 months
from the date of issuance (or which are cancelable not later than 12 months
from
the date of issuance and each renewal) or 30 days prior to the Revolving
Credit Termination Date, in an aggregate face amount as set forth above, upon
the receipt of an application duly executed by the Company, on behalf of the
applicable Borrower, for the relevant Letter
of Credit in the form then customarily prescribed by the L/C Issuer for the
Letter of Credit requested (each an “Application”). Notwithstanding
anything contained in any Application to the contrary: (i) the
Borrowers shall pay fees in connection with each Letter of Credit as set forth
in Section 2.1 hereof, (ii) except as otherwise provided in
Section 1.9 or 1.18 hereof, before the occurrence
of
a Default or an Event of Default, the L/C Issuer will not call for the funding
by the Borrowers of any amount under a Letter of Credit before being presented
with a drawing thereunder, and (iii) if the L/C Issuer is not timely
reimbursed for the amount of any drawing under a Letter of Credit on the date
such drawing is paid, the Borrowers’ obligation to reimburse the L/C Issuer for
the amount of such drawing shall bear interest (which the Borrowers hereby
promise to pay) from and after the date such drawing is paid at a rate per
annum, equal to the sum of the Base Rate from time to time in effect (computed
on the basis of a year of 365 or 366 days, as the case may be, and the actual
number of days elapsed) plus the Applicable Margin
for Base Rate Loans. If the L/C Issuer issues any Letter of Credit
with an expiration date that is automatically extended unless the L/C Issuer
gives notice that the expiration date will not so extend beyond its then
scheduled expiration date, unless the Required Lenders instruct the L/C Issuer
otherwise, the L/C Issuer will give such notice of non-renewal before the time
necessary to prevent such automatic extension if before such required notice
date: (i) the expiration date of such Letter of Credit if so
extended would be after the Revolving Credit Termination Date, (ii) the
Revolving Credit Commitments have been terminated, or (iii) a Default or an
Event of Default exists and the Administrative Agent, at the request or with
the
consent of the Required Lenders, has given the L/C Issuer instructions not
to so
permit the extension of the expiration date of such Letter of
Credit.
2
The
L/C
Issuer agrees to issue amendments to the Letter(s) of Credit increasing the
amount, or extending the expiration date, thereof at the request of the Company,
on behalf of the applicable Borrower, subject to the conditions of
Section 7 hereof and the other terms of this
Section 1.3. Notwithstanding anything contained herein to the
contrary, the L/C Issuer shall be under no obligation to issue, extend or amend
any Letter of Credit if a default of any Lender’s obligations to fund under
Section 1.3(e) exists or any Lender is at such time a Defaulting Lender
hereunder, unless the L/C Issuer has entered into arrangements with Borrower
or
such Lender satisfactory to the L/C Issuer to eliminate the L/C Issuer’s risk
with respect to such Lender.
(c)
The
Reimbursement
Obligations. Subject to Section 1.3(b) hereof, the
obligation of the Borrowers to reimburse the L/C Issuer for all drawings under
a
Letter of Credit (such obligation of the Borrowers being herein referred to
as a
“Reimbursement
Obligation”) shall be governed by the Application related to such Letter
of Credit, except that reimbursement shall be made in immediately available
funds by no later than 12:00 Noon (Chicago time) on the date when each drawing
is to be paid if the Company, on behalf of the applicable Borrower, has been
informed of such drawing by the L/C Issuer on or before 9:00 a.m. (Chicago
time) (including the day before such drawing is to be paid) on the date when
such drawing is to be paid or, if notice of such drawing is given to the
Company, on behalf of the applicable Borrower, after 9:00 a.m. (Chicago
time) on the date when such drawing is to be paid, by the end of such day in
immediately available funds, at the Administrative Agent’s principal office in
Chicago, Illinois or such other office as the Administrative Agent may designate
in writing to the Company, on behalf of the applicable Borrower (and the
Administrative Agent shall thereafter cause to be distributed to the L/C Issuer
such amount(s) in like funds). If the Borrowers do not make any such
reimbursement payment on the date due and the Participating Lenders fund their
participations therein in the manner set forth in Section 1.3(e) below,
then all payments thereafter received by the Administrative Agent in discharge
of any of the relevant Reimbursement Obligations shall be distributed in
accordance with Section 1.3(e) below.
(d) Obligations
Absolute. The Borrowers’ obligation to reimburse L/C
Obligations as provided in subsection (c) of this Section shall be
absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement and the relevant Application under
any and all circumstances whatsoever and irrespective of (i) any lack of
validity or enforceability of any Letter of Credit or this Agreement, or any
term or provision therein, (ii) any draft or other document presented under
a
Letter of Credit proving to be forged, fraudulent or invalid in any respect
or
any statement therein being untrue or inaccurate in any respect, (iii) payment
by the L/C Issuer under a Letter of Credit against presentation of a draft
or other document that does not strictly comply with the terms of such Letter
of
Credit, or (iv) any other event or circumstance whatsoever, whether or not
similar to any of the foregoing, that might, but for the provisions of this
Section, constitute a legal or equitable discharge of, or provide a right of
setoff against, the Borrowers obligations hereunder. None of the Administrative
Agent, the Lenders, or the L/C Issuer shall have any liability or
responsibility by reason of or in connection with the issuance or transfer
of
any Letter of Credit or any payment or failure to make any payment thereunder
(irrespective of any of the circumstances referred to in the preceding
sentence), or any error, omission, interruption, loss or delay in transmission
or delivery of any draft, notice or other communication under or relating to
any
Letter of Credit (including any document required to make a drawing thereunder),
any error in interpretation of
3
technical
terms or any consequence arising from causes beyond the control of the
L/C Issuer; provided that the foregoing
shall not be construed to excuse the L/C Issuer from liability to the
Borrowers to the extent of any direct damages (as opposed to consequential
damages, claims in respect of which are hereby waived by the Borrowers to the
extent permitted by applicable law) suffered by a Borrower that are caused
by
the L/C Issuer ’s failure to exercise care when determining whether drafts
and other documents presented under a Letter of Credit comply with the terms
thereof. The parties hereto expressly agree that, in the absence of
gross negligence or willful misconduct on the part of the L/C Issuer (as
finally determined by a court of competent jurisdiction), the L/C Issuer
shall be deemed to have exercised care in each such determination. In
furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit,
the
L/C Issuer may, in its sole discretion, either accept and make payment upon
such documents without responsibility for further investigation, regardless
of
any notice or information to the contrary, or refuse to accept and make payment
upon such documents if such documents are not in strict compliance with the
terms of such Letter of Credit.
(e)
The
Participating
Interests. Each Lender (other than the Lender acting as L/C
Issuer in issuing the relevant Letter of Credit), by its acceptance hereof,
severally agrees to purchase from the L/C Issuer, and the L/C Issuer hereby
agrees to sell to each such Lender (a “Participating Lender”), an
undivided percentage participating interest (a “Participating Interest”), to
the extent of its Revolver Percentage, in each Letter of Credit issued by,
and
each Reimbursement Obligation owed to, the L/C Issuer. Upon any
failure by a Borrower to pay any Reimbursement Obligation at the time required
on the date the related drawing is to be paid, as set forth in
Section 1.3(c) above, or if the L/C Issuer is required at any time to
return to any Borrower or to a trustee, receiver, liquidator, custodian or
other
Person any portion of any payment of any Reimbursement Obligation, each
Participating Lender shall, not later than the Business Day it receives a
certificate in the form of Exhibit A hereto from the L/C Issuer (with a
copy to the Administrative Agent) to such effect, if such certificate is
received before 1:00 p.m. (Chicago time), or not later than 1:00 p.m.
(Chicago time) the
following Business Day, if such certificate is received after such time, pay
to
the Administrative Agent for the account of the L/C Issuer an amount equal
to
such Participating Lender’s Revolver Percentage of such unpaid or recaptured
Reimbursement Obligation together with interest on such amount accrued from
the
date the related payment was made by the L/C Issuer to the date of such payment
by such Participating Lender at a rate per annum equal
to: (i) from the date the related payment was made by the L/C
Issuer to the date 2 Business Days after payment by such Participating
Lender is due hereunder, the Federal Funds Rate for each day and (ii) from
the date 2 Business Days after the date such payment is due from such
Participating Lender to the date such payment is made by such Participating
Lender, the Base Rate in effect for each such day. Each such
Participating Lender shall thereafter be entitled to receive its Revolver
Percentage of each payment received in respect of the relevant Reimbursement
Obligation and of interest paid thereon, with the L/C Issuer retaining its
Revolver Percentage thereof as a Lender hereunder. The several
obligations of the Participating Lenders to the L/C Issuer under this
Section 1.3 shall be absolute, irrevocable, and unconditional under any and
all circumstances whatsoever and shall not be subject to any set-off,
counterclaim or defense to payment which any Participating Lender may have
or
have had against the Borrower, the L/C Issuer, the Administrative Agent, any
Lender or any other Person whatsoever. Without limiting the
generality of the foregoing, such obligations shall not be affected by any
Default or Event of Default or by any reduction or termination of the Commitment
of any Lender after the issuance of the applicable Letter of Credit, and each
payment by a Participating Lender under this Section 1.3 shall be made
without any offset, abatement, withholding or reduction whatsoever.
4
(f) Indemnification. The
Participating Lenders shall, to the extent of their respective Revolver
Percentages, indemnify the L/C Issuer (to the extent not reimbursed by the
applicable Borrower) against any cost, expense (including reasonable counsel
fees and disbursements), claim, demand, action, loss or liability (except such
as result from the L/C Issuer’s gross negligence or willful misconduct) that the
L/C Issuer may suffer or incur in connection with any Letter of Credit issued
by
it. The obligations of the Participating Lenders under this
Section 1.3(f) and all other parts of this Section 1.3 shall survive
termination of this Agreement and of all Applications, Letters of Credit, and
all drafts and other documents presented in connection with drawings
thereunder.
(g) Manner
of Requesting a Letter of
Credit. The Company, on behalf of the applicable Borrower,
shall provide at least five (5) Business Days’ advance written notice to
the Administrative Agent of each request for the issuance of a Letter of Credit,
such notice in each case to be accompanied by an Application for such Letter
of
Credit properly completed and executed by the Company, on behalf of the
applicable Borrower, and, in the case of an extension or an increase in the
amount of a Letter of Credit, a written request therefor, in a form acceptable
to the Administrative Agent and the L/C Issuer, in each case, together with
the fees called for by this Agreement. The Administrative Agent shall
promptly notify the L/C Issuer of the Administrative Agent’s receipt of
each such notice (and the L/C Issuer
shall be entitled to assume that the conditions precedent to any such issuance,
extension, amendment or increase have been satisfied unless notified to the
contrary by the Administrative Agent or the Required Lenders) and the
L/C Issuer shall promptly notify the Administrative Agent and the Lenders
of the issuance of the Letter of Credit so requested.
(h) Replacement
of the
L/C Issuer. The L/C Issuer may be replaced at any
time by written agreement among the Company, on behalf of the Borrowers, the
Administrative Agent, the replaced L/C Issuer and the successor
L/C Issuer. The Administrative Agent shall notify the Lenders of
any such replacement of the L/C Issuer. At the time any such
replacement shall become effective, the Borrowers shall pay all unpaid fees
accrued for the account of the replaced L/C Issuer. From and
after the effective date of any such replacement (i) the successor
L/C Issuer shall have all the rights and obligations of the L/C Issuer
under this Agreement with respect to Letters of Credit to be issued thereafter
and (ii) references herein to the term “L/C Issuer ” shall be deemed
to refer to such successor or to any previous L/C Issuer, or to such
successor and all previous L/C Issuer s, as the context shall
require. After the replacement of a L/C Issuer hereunder, the
replaced L/C Issuer shall remain a party hereto and shall continue to have
all the rights and obligations of a L/C Issuer under this Agreement with
respect to Letters of Credit issued by it prior to such replacement, but shall
not be required to issue additional Letters of Credit.
Section 1.4. Applicable
Interest Rates. (a) Base Rate
Loans. Each Base Rate Loan made or maintained by a Lender
shall bear interest during each Interest Period it is outstanding (computed
on
the basis of a year of 365 or 366 days, as the case may be, and the actual
days elapsed) on the unpaid principal amount thereof from the date such Loan
is
advanced, continued or created by conversion from a Eurocurrency Loan, until
maturity (whether by acceleration or otherwise) at a rate per annum equal to
the
sum of the Applicable Margin plus the Base Rate from time to time in effect,
payable by the Borrowers on the last day of each Interest Period and at maturity
(whether by acceleration or otherwise).
5
(b) Eurocurrency
Loans. Each Eurocurrency Loan made or maintained by a Lender
shall bear interest during each Interest Period it is outstanding (computed
on
the basis of a year of 360 days and actual days elapsed) on the unpaid principal
amount thereof from the date such Loan is advanced, continued or created by
conversion from a Base Rate Loan until maturity (whether by acceleration or
otherwise) at a rate per annum equal to the sum of the Applicable Margin plus
the Adjusted LIBOR applicable for such Interest Period, payable on the last
day
of the Interest Period and at maturity (whether by acceleration or otherwise),
and, if the applicable Interest Period is longer than three months, on each
day
occurring every three months after the commencement of such Interest
Period.
(c) Rate
Determinations. The
Administrative Agent shall determine each interest rate applicable to the Loans
and the Reimbursement Obligations hereunder, and its determination thereof
shall
be conclusive and binding except in the case of manifest error.
Section 1.5. Minimum
Borrowing Amounts; Maximum Eurocurrency
Loans. Each Borrowing of Base Rate Loans shall be
in an amount not less than $2,000,000 or such greater amount which is an
integral multiple of $100,000. Each Borrowing of Eurocurrency Loans
shall be in an amount not less than $4,000,000 or such greater amount which
is
an integral multiple of $100,000. Without the Administrative Agent’s
consent, there shall not be more than ten (10) Borrowings of
Eurocurrency Loans outstanding hereunder at any one
time.
Section 1.6. Manner
of Borrowing Loans and Designating Applicable Interest
Rates. (a) Notice to the Administrative
Agent. The Company, on behalf of the Borrowers, shall give
notice to the Administrative Agent by no later
than
12:00 noon (Chicago time): (i) at least 3 Business
Days before the date on which the Company, on behalf of the applicable Borrower,
requests the Lenders to advance a Borrowing of Eurocurrency Loans and
(ii) on the date the Company, on behalf of the applicable Borrower,
requests the Lenders to advance a Borrowing of Base Rate Loans. The
Loans included in each Borrowing shall bear interest initially at the type
of
rate specified in such notice of a new Borrowing. Thereafter, subject
to the terms and conditions hereof, the Company, on behalf of the applicable
Borrower, may from time to time elect to change or continue the type of interest
rate borne by each Borrowing or, subject to the minimum amount requirement
contained in Section 1.5 for each outstanding Borrowing, a portion thereof,
as
follows: (i) if such Borrowing is of Eurocurrency Loans, on the
last day of the Interest Period applicable thereto, the Company, on behalf
of
the applicable Borrower, may (subject to the notice requirement set forth
herein) continue part or all of such Borrowing as Eurocurrency Loans or convert
part or all of such Borrowing into Base Rate Loans or (ii) if such
Borrowing is of Base Rate Loans, on any Business Day, the Company, on behalf
of
the applicable Borrower, may convert all or part of such Borrowing into
Eurocurrency Loans for an Interest Period or Interest Periods specified by
the
Company.
6
The
Company, on behalf of the applicable Borrower, shall give all such notices
requesting the advance, continuation or conversion of a Borrowing to the
Administrative Agent by telephone
or
telecopy (which notice shall be irrevocable once given and, if by telephone,
shall be promptly confirmed in writing), substantially in the form attached
hereto as Exhibit B (Notice of Borrowing) or Exhibit C (Notice of
Continuation/Conversion), as applicable, or in such other form acceptable to
the
Administrative Agent. Notice
of the continuation of a Borrowing of Eurocurrency Loans for an additional
Interest Period or of the conversion of part or all of a Borrowing of Base
Rate
Loans into Eurocurrency Loans must be given by no later than 10:00 a.m.
(Chicago time) at least 3 Business Days before the date of the requested
continuation or conversion. All such notices concerning the advance,
continuation or conversion of a Borrowing shall specify the date of the
requested advance, continuation or conversion of a Borrowing (which shall be
a
Business Day), the amount of the requested Borrowing to be advanced, continued
or converted, the type of Loans to comprise such new, continued or converted
Borrowing and, if such Borrowing is to be comprised of Eurocurrency Loans,
the
currency and the Interest Period applicable thereto. Upon notice to
the Company by the Administrative Agent or the Required Lenders, no Borrowing
of
Eurocurrency Loans shall be advanced, continued, or created by conversion if
any
Default or Event of Default then exists. The Borrowers agree that the
Administrative Agent may rely on any such telephonic or telecopy notice given
by
any person the Administrative Agent in good faith believes is an Authorized
Representative of the Company without the necessity of independent
investigation, and in the event any such notice by telephone conflicts with
any
written confirmation such telephonic notice shall govern if the Administrative
Agent has acted in reliance thereon.
(b)
Notice
to the
Lenders. The Administrative Agent shall give prompt telephonic
or telecopy notice to each Lender of any notice from the Company received
pursuant to Section 1.6(a) above and, if such notice requests the Lenders
to make Eurocurrency Loans, the Administrative Agent shall give notice to the
Company and each Lender by like means of the interest rate applicable thereto
promptly after the Administrative Agent has made such
determination.
(c)
Company’s
Failure to Notify;
Automatic Continuations and Conversions. Any outstanding
Borrowing of Base Rate Loans shall automatically be continued for an additional
Interest Period on the last day of its then current Interest Period unless
the
Company, on behalf of the applicable Borrower, has notified the Administrative
Agent within the period required by Section 1.6(a) that such Borrower
intends to convert such Borrowing into a Borrowing of Eurocurrency Loans or
such
Borrowing is prepaid in accordance with Section 1.9(a). If the
Company, on behalf of the applicable Borrower, fails to give notice pursuant
to
Section 1.6(a) above of the continuation or conversion of any outstanding
principal amount of a Borrowing of Eurocurrency Loans before the last day of
its
then current Interest Period within the period required by Section 1.6(a)
and such Borrowing is not prepaid in accordance with Section 1.9(a), such
Borrowing shall automatically be converted into a Borrowing of Base Rate
Loans. In the event the Company, on behalf of the applicable
Borrower, fails to give notice pursuant to Section 1.6(a) above of a
Borrowing equal to the amount of a Reimbursement Obligation and has not notified
the Administrative Agent by 12:00 noon (Chicago time) on the day such
Reimbursement Obligation becomes due that it intends to repay such Reimbursement
Obligation through funds not borrowed under this Agreement, the relevant
Borrower shall be deemed to have requested a Borrowing of Base Rate Loans under
the Revolving Credit (or, at the option of the Administrative Agent, under
the
Swing Line) on such day in the amount of theReimbursement
Obligation then due, which Borrowing shall be applied to pay the Reimbursement
Obligation then due.
7
(d)
Disbursement
of
Loans. Not later than 1:00 p.m. (Chicago time) on the
date of any requested advance of a new Borrowing, subject to Section 7
hereof, each Lender shall make available its Loan comprising part of such
Borrowing in funds immediately available at the principal office of the
Administrative Agent (or its Affiliate’s) in Chicago, Illinois. The
Administrative Agent shall make the proceeds of each new Borrowing available
to
the relevant Borrower at the Administrative Agent’s principal office in Chicago,
Illinois, by depositing such proceeds to the credit of such Borrower’s
Designated Disbursement Account or as the Company, on behalf of the relevant
Borrower, and the Administrative Agent may otherwise agree.
(e)
Administrative
Agent Reliance on
Lender Funding. Unless the Administrative Agent shall have
been notified by a Lender prior to (or, in the case of a Borrowing of Base
Rate
Loans, by 1:00 p.m. (Chicago time) on the date on which such Lender is
scheduled to make payment to the Administrative Agent of the proceeds of a
Loan
(which notice shall be effective upon receipt) that such Lender does not intend
to make such payment, the Administrative Agent may assume that such Lender
has
made such payment when due and the Administrative Agent may in reliance upon
such assumption (but shall not be required to) make available to the applicable
Borrower the proceeds of the Loan to be made by such Lender and, if any Lender
has not in fact made such payment to the Administrative Agent, such Lender
shall, on demand, pay to the Administrative Agent the amount made available
to
the applicable Borrower attributable to such Lender together with interest
thereon in respect of each day during the period commencing on the date such
amount was made available to the applicable Borrower and ending on (but
excluding) the date such Lender pays such amount to the Administrative Agent
at
a rate per annum equal to: (i) from the date the related advance
was made by the Administrative Agent to the date 2 Business Days after payment
by such Lender is due hereunder, the Federal Funds Rate in effect for each
such
day and (ii) from the date 2 Business Days after the date such payment is
due from such Lender to the date such payment is made by such Lender, the Base
Rate in effect for each such day. If such amount is not received from
such Lender by the Administrative Agent immediately upon demand, the Borrowers
will, on demand, repay to the Administrative Agent the proceeds of the Loan
attributable to such Lender with interest thereon at a rate per annum equal
to
the interest rate applicable to the relevant Loan, but without such payment
being considered a payment or prepayment of a Loan under Section 1.12
hereof so that the Borrowers will have no liability under such Section with
respect to such payment.
Section 1.7. Interest
Periods. As provided in Section 1.6(a) hereof, at the
time of each request to advance, continue or create by conversion a Borrowing
of
Eurocurrency Loans or Swing Loans, the Company, on behalf of the applicable
Borrower, shall select an Interest Period applicable to such Loans from among
the available options. The term “Interest Period” means the
period commencing on the date a Borrowing of Loans is advanced, continued or
created by conversion and ending: (a) in the case of Base Rate
Loans and Swing Loans bearing interest at the Base Rate, on the last day of
the
calendar quarter (i.e.,
the last day of March, June, September or December, as applicable) in which
such
Borrowing is advanced, continued or created by conversion (or on the last day
of
the following calendar quarter if such Loan is advanced, continued or created
by
conversion on the last day of a calendar quarter), (b) in the case of a
Eurocurrency Loan, one, two, three or six months thereafter, and (c) in the
case of a Swing Loan bearing
interest at the Swing Loan Lender’s Quoted Rate, on the date one to five days
thereafter as mutually agreed to by the Company, on behalf of the applicable
Borrower, and the Administrative Agent; provided, however,
that:
8
(i) any
Interest Period for a Borrowing of Revolving Loans consisting of Base Rate
Loans
that otherwise would end after the Revolving Credit Termination Date shall
end
on the Revolving Credit Termination Date, and any Interest Period for a
Borrowing of Term Loans consisting of Base Rate Loans that otherwise would
end
after the final maturity date of the Term Loans shall end on the final maturity
date of the Term Loans;
(ii) no
Interest Period with respect to any portion of the Revolving Loans consisting
of
Eurocurrency Loans shall extend beyond the Revolving Credit Termination Date
and
no Interest Period with respect to any portion of the Term Loans shall extend
beyond the final maturity date of the Term Loans;
(iii) no
Interest Period with respect to any portion of the Term Loans consisting of
Eurocurrency Loans shall extend beyond a date on which the Borrowers are
required to make a scheduled payment of principal on the Term Loans unless
the
sum of (a) the aggregate principal amount of Term Loans that are Base Rate
Loans plus (b) the
aggregate principal amount of Term Loans that are Eurocurrency Loans with
Interest Periods expiring on or before such date equals or exceeds the principal
amount to be paid on the Term Loans on such payment date;
(iv) whenever
the last day of any Interest Period would otherwise be a day that is not a
Business Day, the last day of such Interest Period shall be extended to the
next
succeeding Business Day, provided that, if such extension would cause the last
day of an Interest Period for a Borrowing of Eurocurrency Loans to occur in
the
following calendar month, the last day of such Interest Period shall be the
immediately preceding Business Day; and
(v) for
purposes of determining an Interest Period for a Borrowing of Eurocurrency
Loans, a month means a period starting on one day in a calendar month and ending
on the numerically corresponding day in the next calendar month; provided,
however, that if there is no numerically corresponding day in the month in
which
such an Interest Period is to end or if such an Interest Period begins on the
last Business Day of a calendar month, then such Interest Period shall end
on
the last Business Day of the calendar month in which such Interest Period is
to
end.
Section 1.8. Maturity
of Loans. (a) Scheduled
Payments of Term
Loans. The Borrowers shall make principal payments on the Term
Loans in quarterly installments on the last day of each March, June, September,
and December in each year, commencing with the quarter ending
March 31, 2009, with the amount of each such principal installment to
equal the amount set forth in Column B below shown opposite of the relevant
due date as set forth in Column A below:
Column A
Payment
Date
|
Column B
Scheduled
Principal
Payment
on Term Loans
|
03/31/09
|
$3,750,000
|
06/30/09
|
$3,750,000
|
09/30/09
|
$3,750,000
|
12/31/09
|
$3,750,000
|
03/31/10
|
$3,750,000
|
06/30/10
|
$3,750,000
|
09/30/10
|
$3,750,000
|
12/31/10
|
$3,750,000
|
03/31/11
|
$3,750,000
|
06/30/11
|
$3,750,000
|
09/30/11
|
$3,750,000
|
11/01/11
|
$33,750,000
|
;
it
being agreed that the final payment of both principal and interest not sooner
paid on the Term Loans shall be due and payable on November 1, 2011 the
final maturity thereof. Each such principal payment shall be applied
to the Lenders holding the Term Loans pro rata based upon their
Term Loan Percentages; provided,however,
that if any
additional Term Loans are advanced pursuant to Section 1.17 hereof, each
scheduled installment due from and after the date of such advance through
September 30, 2011 shall be increased by an amount equal to the product of
(A)
such additional Term Loan advance multiplied by (b) an amount (expressed as
a percentage), the numerator of which is the amount of the scheduled installment
for such period (without giving effect to such additional Term Loan) and the
denominator of which is the outstanding principal balance of the Term Loans
(without giving effect to such additional Term Loans).
(b) Revolving
Loans and Swing
Loans. Each Revolving Loan and Swing Loan, both for principal
and interest not sooner paid, shall mature and become due and payable by the
Borrowers on the Revolving Credit Termination Date.
9
Section 1.9. Prepayment.s (a) Optional. The
Borrowers may prepay in whole or in part (but, if in part,
then: (i) if such Borrowing is of Base Rate Loans, in an amount
not less than $500,000, (ii) if such Borrowing is of Eurocurrency Loans, in
an amount not less than $1,000,000, and (iii) in each case, in an amount
such that the minimum amount required for a Borrowing pursuant to
Sections 1.5 and 1.16 hereof remains outstanding) any Borrowing of
(y) Eurocurrency Loans at any time upon 3 Business Days prior notice
by the Company, on behalf of the Borrowers, to the Administrative Agent,
or
(z) Base Rate Loans, at any time upon notice delivered by the Company, on
behalf of the Borrowers, to the Administrative Agent no later than
10:00 a.m. (Chicago time) on the date of prepayment (or, in any case, such
shorter period of time then agreed to by the Administrative Agent), such
prepayment to be made by the payment of the principal amount to be prepaid
and,
in the case of any Term Loans or Eurocurrency Loans or Swing Loans, accrued
interest thereon to the date fixed for prepayment plus any amounts due the
Lenders under Section 1.12 hereof.
(b) Mandatory. (i) Dispositions
or Event of
Loss. If the Company or any Subsidiary shall at any time or
from time to time make or agree to make a Disposition or shall suffer an Event
of Loss resulting in Net Cash Proceeds in excess of $10,000,000 individually
or
on a cumulative basis in any fiscal year of the Borrowers, then (x) the
Company shall promptly notify the Administrative Agent of such proposed
Disposition or Event of Loss (including the amount of the estimated Net
Cash Proceeds to be received by such Person in respect thereof) and
(y) promptly upon receipt by such Person of such Net Cash Proceeds in
excess of $10,000,000 from such Disposition or Event of Loss, the Company shall
cause such Person to prepay the Term Loans (or all outstanding Loans and
L/C Obligations if an Event of Default exists) in an aggregate amount equal
to 100% of the amount of all such Net Cash Proceeds in excess of $10,000,000;
provided that in the
case of each Disposition or Event of Loss, if the Company states in its notice
of such event that such Person intends to reinvest, within 360 days of the
applicable Disposition or Event of Loss, the Net Cash Proceeds thereof in assets
similar to the assets which were subject to such Disposition or Event of Loss,
then so long as no Default or Event of Default then exists, such Person shall
not be required to make a mandatory prepayment under this Section in respect
of
such Net Cash Proceeds to the extent such Net Cash Proceeds are actually
reinvested in such similar assets with such 360-day period. The
amount of each such prepayment shall be applied first to the outstanding Term
Loans until paid in full, then to the outstanding principal amount of Revolving
Loans until paid in full and then to cash collateralized Letters of Credit
in
accordance with Section 9.4 hereof.
(ii) Debt
Issuance. If
after the Closing Date the Company or any Subsidiary shall issue any
Indebtedness for Borrowed Money, other than Indebtedness for Borrowed Money
permitted by Section 8.7 hereof, the Company shall promptly notify the
Administrative Agent of the estimated Net Cash Proceeds of such issuance to
be
received by or for the account of such Person in respect
thereof. Promptly upon receipt by such Person of Net Cash Proceeds of
such issuance, the Company shall cause such Person to prepay the Term Loans
(or
all outstanding Loans and L/C Obligations if an Event of Default exists) in
an
aggregate amount equal to 100% of the amount of such Net Cash
Proceeds. The amount of each such prepayment shall be applied first
to the outstanding Term Loans until paid in full, then to the outstanding
principal amount of Revolving Loans until paid in full and then to cash
collateralized Letters of Credit in accordance with Section 9.4
hereof. The Borrowers and Guarantors acknowledge that their
performance hereunder shall not limit the rights and remedies of the Lenders
for
any breach of Section 8.7 hereof or any other terms of this
Agreement.
10
(iii) Commitment
Terminations. The Borrowers shall, on each date the Revolving
Credit Commitments are reduced pursuant to Section 1.13 hereof, prepay the
Revolving Credit Loans and Swing Loans, and, if necessary, prefund the L/C
Obligations by the amount, if any, necessary to reduce the sum of the aggregate
principal amount of Revolving Credit Loans and Swing Loans and L/C Obligations
then outstanding to the amount to which the Revolving Credit Commitments have
been so reduced.
(iv) Application
of
Prepayments. Unless the Company, on behalf of the Borrowers,
otherwise directs, prepayments made under this Section 1.9(b) shall be applied first
to
Borrowings of Base Rate Loans until payment in full thereof with any balance
applied to Borrowings of Eurocurrency Loans in the order in which their Interest
Periods expire. Each prepayment of Loans under this
Section 1.9(b) shall be made by the payment of the principal amount to be
prepaid and, in the case of any Term Loans or Eurocurrency Loans or Swing Loans,
accrued interest thereon to the date of prepayment together with any amounts
due
the Lenders under Section 1.12 hereof. Each prefunding of L/C
Obligations shall be made in accordance with Section 9.4
hereof.
(c) Notice;
Reborrowing. The Administrative Agent will promptly advise
each Lender of any notice of prepayment it receives from the
Borrowers. Any amount of Revolving Loans and Swing Loans paid or
prepaid before the Revolving Credit Termination Date may, subject to the terms
and conditions of this Agreement, be borrowed, repaid and borrowed again. No
amount of the Term Loans paid or prepaid may be reborrowed, and, in the case
of
any partial prepayment, such prepayment shall be applied to the remaining
amortization payments on the Term Loans on a ratable basis among all such
remaining amortization payments based on the principal amounts
thereof.
Section 1.10. Default
Rate. Notwithstanding anything to the contrary contained in
Section 1.3 hereof, while any Event of Default exists or after
acceleration, the Borrowers shall, jointly and severally, pay interest (after
as
well as before entry of judgment thereon to the extent permitted by law) on
the
principal amount of all Loans and Reimbursement Obligations and letter of credit
fees at a rate per annum equal to:
(a) for
any Base Rate Loan or Swing Loans bearing interest at the Base Rate, the sum
of
2.0% plus the Applicable Margin plus the Base Rate from time to time in
effect;
(b) for
any Eurocurrency Loan or Swing Loans bearing interest at the Swing Line Lender’s
Quoted Rate, the sum of 2.0% plus the rate of interest
in
effect thereon at the time of such default until the end of the Interest Period
applicable thereto and, thereafter, at a rate per annum equal to the sum of
2.0%
plus the Applicable
Margin for Base Rate Loans plus the Base Rate from
time
to time in effect;
(c) for
any Reimbursement Obligation, the sum of 2.0% plus the amounts due
under
Section 1.3 with respect to such Reimbursement Obligation; and
(d)
for
any Letter of Credit, the sum of 2.0% plus the letter of credit
fee
due under Section 2.1 with respect to such Letter of Credit;
provided,
however,
that in the absence of acceleration, any adjustments pursuant to
this Section shall be made at the election of the Administrative Agent, acting
at the request or withthe consent of the Required Lenders,
with written notice to the Borrowers. While any Event of Default
exists or after acceleration, interest shall be paid on demand of the
Administrative Agent at the request or with the consent of the Required
Lenders.
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Section 1.11. Evidence
of Indebtedness. (a) Each Lender shall maintain in
accordance with its usual practice an account or accounts evidencing the
indebtedness of the Borrowers to such Lender resulting from each Loan made
by
such Lender from time to time, including the amounts of principal and interest
payable and paid to such Lender from time to time hereunder.
(b) The
Administrative Agent shall also maintain accounts in which it will record
(i) the amount of each Loan made hereunder, the type thereof and the
Interest Period with respect thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrowers to
each
Lender hereunder and (iii) the amount of any sum received by the
Administrative Agent hereunder from the Borrowers and each Lender’s share
thereof.
(c) The
entries maintained in the accounts maintained pursuant to paragraphs (a)
and (b) above shall be prima
facie evidence of the existence and amounts of the Obligations therein
recorded absent manifest error; provided, however, that the
failure of the Administrative Agent or any Lender to maintain such accounts
or
any error therein shall not in any manner affect the obligation of the Borrowers
to repay the Obligations in accordance with their terms.
(d) Any
Lender may request that its Loans be evidenced by a promissory note or notes
in
the forms of Exhibit D-1 (in the case of its Term Loan and referred to herein
as
a “Term Note”), D-2 (in
the case of its Revolving Loans and referred to herein as a “Revolving Note”), or D-3 (in
the case of its Swing Loans and referred to herein as a “Swing Note”), as applicable
(the Term Notes, Revolving Notes, and Swing Note being hereinafter referred
to
collectively as the “Notes” and individually
as a
“Note”). In
such event, the Borrowers shall execute and deliver to such Lender a Note
payable to such Lender or its registered assigns in the amount of the Term
Loan,
Commitment, or Swing Line Sublimit, as applicable. Thereafter, the
Loans evidenced by such Note or Notes and interest thereon shall at all times
(including after any assignment pursuant to Section 13.12) be represented
by one or more Notes payable to the order of the payee named therein or any
assignee pursuant to Section 13.12, except to the extent that any such
Lender or assignee subsequently returns any such Note for cancellation and
requests that such Loans once again be evidenced as described in
subsections (a) and (b) above.
Section 1.12. Funding
Indemnity. If any Lender shall incur any loss, cost or expense
(including, without limitation, any loss of profit, and any loss, cost or
expense incurred by reason of the liquidation or re-employment of deposits
or
other funds acquired by such Lender to fund or maintain any Eurocurrency Loan
or
Swing Loan or the
relending or reinvesting of such deposits or amounts paid or prepaid to such
Lender) as a result of:
(a) any
payment, prepayment or conversion of a Eurocurrency Loan or Swing Loan on a
date
other than the last day of its Interest Period,
(b) any
failure (because of a failure to meet the conditions of Section 7 or
otherwise) by any Borrower to borrow or continue a Eurocurrency Loan or Swing
Loan,or to convert a Base Rate Loan into a Eurocurrency
Loan or Swing Loan
on the date specified in a notice given pursuant to Section 1.6(a) or
1.16 hereof,
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(c) any
failure by a Borrower to make any payment of principal on any Eurocurrency
Loan or Swing Loan
when due (whether by acceleration or otherwise), or
(d) any
acceleration of the maturity of a Eurodollar Loan or Swing Loan as a result
of
the occurrence of any Event of Default hereunder,
then,
within 15 days after the demand by such Lender, the Borrowers shall pay to
such
Lender such amount as will reimburse such Lender for such loss, cost or
expense. If any Lender makes such a claim for compensation, it shall
provide to the Company, on behalf of the Borrowers, with a copy to the
Administrative Agent, a certificate setting forth the amount of such loss,
cost
or expense in reasonable detail (including an explanation of the basis for
and
the computation of such loss, cost or expense) and the amounts shown on such
certificate shall be deemed prime facie correct, absent
manifest error.
Section 1.13. Commitment
Terminations. (a) Optional Revolving
Credit
Terminations. The Borrowers shall have the right at any time
and from time to time, upon 5 Business Days prior written notice given by
the Company to the Administrative Agent (or such shorter period of time agreed
to by the Administrative Agent), to terminate the Revolving Credit Commitments
without premium or penalty and in whole or in part, any partial termination
to
be (i) in an amount not less than $5,000,000 and (ii) allocated
ratably among the Lenders in proportion to their respective Revolver
Percentages, provided that the Revolving Credit Commitments may not be reduced
to an amount less than the sum of the aggregate principal amount of Revolving
Loans, Swing Loans, and all L/C Obligations then
outstanding. Any termination of the Revolving Credit Commitments
below the L/C Sublimit or Swing Line Sublimit then in effect shall reduce
the L/C Sublimit and Swing Line Sublimit, as applicable, to an amount equal
to the reduced aggregate amount of the Revolving Credit
Commitments. The Administrative Agent shall give prompt notice to
each Lender of any such termination of the Revolving Credit
Commitments.
(b) Mandatory
Revolving Credit
Termination. If at any time Net Cash Proceeds or other amounts
remain after the prepayment of the Term Loans in full pursuant to
Section 1.9(b)(i) or (ii) hereof, the Revolving Credit Commitments shall
ratably terminate by an amount equal to 100% of such excess (i) to the
extent the Revolving Credit Commitments in effect at such time exceed
$50,000,000; provided,
that in the absence
of an Event of Default that has occurred and is
continuing, such termination shall not reduce the Revolving Credit Commitments
below $50,000,000 and (ii) to the extent that the Revolving Credit
Commitments in effect at such time are $50,000,000 or less, then the Revolving
Credit Commitments shall only be terminated if an Event of Default has occurred
and is continuing.
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(c) No
Reinstatement. Any termination of the Revolving Credit
Commitments pursuant to this Section 1.13 may not be
reinstated.
Section 1.14. Substitution
of Lenders. In the event (a) the Borrowers receive a
claim from any Lender for compensation under Section 10.3 or 13.1 hereof,
(b) the Borrowers receive a notice from any Lender of any illegality
pursuant to Section 10.1 hereof, (c) any Lender is then a Defaulting
Lender or such Lender is a Subsidiary or Affiliate of a Person who has been
deemed insolvent or becomes the subject of a bankruptcy or insolvency proceeding
or a receiver or conservator has been appointed for any such Person, or
(d) a Lender fails to consent to an amendment or waiver requested under
Section 13.13 hereof at a time when the Required Lenders have approved such
amendment or waiver (any such Lender referred to in clause (a), (b), (c) or
(d) above being hereinafter referred to as an “Affected
Lender”), the Borrowers may, in addition to any other rights the
Borrowers may have hereunder or under applicable law, require, at the Borrowers’
expense, any such Affected Lender to assign, at par plus accrued interest
and
fees, without recourse, all of its interest, rights, and obligations hereunder
(including all of its Commitments and the Loans and participation interests
in
Letters of Credit and other amounts at any time owing to it hereunder and
the
other Loan Documents) to an Eligible Assignee, provided
that (i) such assignment shall not conflict with or violate any law, rule
or regulation or order of any court or other governmental authority,
(ii) the Borrowers shall have received the written consent of the
Administrative Agent, which consent shall not be unreasonably withheld, to
such
assignment, (iii) the Borrowers shall have paid to the Affected Lender all
monies (together with amounts due such Affected Lender under Section 1.12
hereof as if the Loans owing to it were prepaid rather than assigned except
if
such Lender is being replaced pursuant to clause (c) above) other than such
principal owing to it hereunder, and (iv) the assignment is entered into in
accordance with the other requirements of Section 13.12 hereof (provided
any assignment fees and reimbursable expenses due thereunder shall be paid
by
the Borrower).
Section 1.15. Appointment
of the Company as Agent for Borrowers. Each Borrower hereby
irrevocably appoints the Company as its agent hereunder to make requests on
such
Borrower’s behalf under Section 1 hereof for Borrowings, to request on such
Borrower’s behalf Letters of Credit and to execute all Applications therefor,
and to take any other action contemplated by the Loan Documents with respect
to
the credit extended hereunder to such Borrower. The Administrative
Agent and the Lenders shall be entitled to conclusively presume that any action
by the Company under the Loan Documents is taken on behalf of all of the
Borrowers whether or not the Company so indicates.
Section 1.16. Swing
Loans. (a) Generally. Subject
to the terms and conditions hereof, as part of the Revolving Credit, the Swing
Line Lender may, in its discretion, make loans in U.S. Dollars to the
Borrowers, or any of them, under the Swing Line (individually a “Swing Loan” and collectively
the “Swing Loans”)
which shall not in the aggregate at any time outstanding exceed the Swing Line
Sublimit. Swing Loans may be availed by the Borrowers from time to
time and borrowings thereunder may be repaid and used again during the period
ending on the Revolving Credit Termination Date; provided, that each Swing
Loan must be repaid on the last day of the Interest Period applicable
thereto. Each Swing Loan shall be in a minimum amount of $250,000 or
such greater amount which is an integral multiple of $50,000.
(b) Interest
on Swing
Loans. Each Swing Loan shall bear interest until maturity
(whether by acceleration or otherwise) at a rate per annum equal to (i) the
sum of the Base Rate plus the Applicable Margin for Base Rate Loans as from
time
to time in effect (computed on the basis of a year of 365 or 366 days, as the
case may be, for the actual number of days elapsed) or (ii) the Swing Line
Lender’s Quoted Rate (computed on the basis of a year of 360 days for
theactual
number of days elapsed). Interest on each Swing Loan shall be due and
payable on the last day of its Interest Period and at maturity (whether by
acceleration or otherwise).
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(c) Requests
for Swing
Loans. The Company, on behalf of the applicable Borrower,
shall give the Administrative Agent prior notice (which may be written or oral)
no later than 12:00 Noon (Chicago time) on the date upon which a Borrower
requests that any Swing Loan be made, of the amount and date of such Swing
Loan,
and the Interest Period requested therefor. The Administrative Agent
shall promptly advise the Swing Line Lender of any such notice received from
the
Company, on behalf of the applicable Borrower. After receiving such
notice, the Swing Line Lender shall in its discretion quote an interest rate
(which shall never be less than the Administrative Agent’s cost of funds) to the
Company, on behalf of the applicable Borrower, at which the Swing Line Lender
would be willing to make such Swing Loan available to such Borrower for the
Interest Period so requested (the rate so quoted for a given Interest Period
being herein referred to as “Swing Line Lender’s Quoted
Rate”). The Borrowers acknowledge and agree that the interest
rate quote is given for immediate and irrevocable acceptance. If the
Company, on behalf of the applicable Borrower, does not so immediately accept
the Swing Line Lender’s Quoted Rate for the full amount requested by such
Borrower for such Swing Loan, the Swing Line Lender’s Quoted Rate shall be
deemed immediately withdrawn and such Swing Loan shall bear interest at the
rate
per annum determined by adding the Applicable Margin for Base Rate Loans under
the Revolving Credit to the Base Rate as from time to time in
effect. Subject to the terms and conditions hereof, the proceeds of
each Swing Loan extended to the Borrowers shall be deposited or otherwise wire
transferred to such Borrower’s Designated Disbursement Account or as the
Company, on behalf of the relevant Borrower, the Administrative Agent, and
the
Swing Line Lender may otherwise agree. Anything contained in the
foregoing to the contrary notwithstanding, the undertaking of the Swing Line
Lender to make Swing Loans shall be subject to all of the terms and conditions
of this Agreement (provided that the Swing Line Lender shall be entitled to
assume that the conditions precedent to an advance of any Swing Loan have been
satisfied unless notified to the contrary by the Administrative Agent or the
Required Lenders).
(d) Refunding
Loans. In its sole and absolute discretion, the Swing Line
Lender may at any time, on behalf of the Borrowers (which hereby irrevocably
authorize the Swing Line Lender to act on their behalf for such purpose) and
with notice to the Company, on behalf of the Borrowers, and the Administrative
Agent, request each Lender to make a Revolving Loan in the form of a Base Rate
Loan in an amount equal to such Lender’s Revolver Percentage of the amount of
the Swing Loans outstanding on the date such notice is given. Unless
an Event of Default described in Section 9.1(j) or 9.1(k) exists with
respect to any Borrower, regardless of the existence of any other Event of
Default, each Lender shall make the proceeds of its requested Revolving Loan
available to the Administrative Agent for the account of the Swing Line Lender),
in immediately available funds, at the Administrative Agent’s (or its
Affiliate’s) office in Chicago, Illinois (or such other location designated by
the Administrative Agent), before 12:00 Noon (Chicago time) on the Business
Day
following the day such notice is given. The Administrative Agent
shall promptly remit the proceeds of such Borrowing to the Swing Line Lender
to
repay the outstanding Swing Loans
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(e) Participations. If
any Lender refuses or otherwise fails to make a Revolving Loan when requested
by
the Swing Line Lender pursuant to Section 1.16(d) above (because anEvent of
Default described in Section 9.1(j) or 9.1(k) exists with respect to a
Borrower or otherwise), such Lender will, by the time and in the manner such
Revolving Loan was to have been funded to the Swing Line Lender, purchase from
the Swing Line Lender an undivided participating interest in the outstanding
Swing Loans in an amount equal to its Revolver Percentage of the aggregate
principal amount of Swing Loans that were to have been repaid with such
Revolving Loans. Each Lender that so purchases a participation in a
Swing Loan shall thereafter be entitled to receive its Revolver Percentage
of
each payment of principal received on the Swing Loan and of interest received
thereon accruing from the date such Lender funded to the Swing Line Lender
its
participation in such Loan. The several obligations of the Lenders
under this Section shall be absolute, irrevocable, and unconditional under
any
and all circumstances whatsoever and shall not be subject to any set-off,
counterclaim or defense to payment which any Lender may have or have had against
any Borrower, any other Lender, or any other Person
whatsoever. Without limiting the generality of the foregoing, such
obligations shall not be affected by any Default or Event of Default or by
any
reduction or termination of the Commitments of any Lender, and each payment
made
by a Lender under this Section shall be made without any offset, abatement,
withholding, or reduction whatsoever.
Section 1.17. Increase
in Revolving Credit Commitments, Additional Term Loans.. The
Company, on behalf of the Borrowers, may from time to time in consultation
with
the Administrative Agent, on any Business Day prior to the Revolving Credit
Termination Date so long as no Event of Default exists, increase the aggregate
outstanding amount of the Revolving Credit Commitments and/or increase the
aggregate outstanding principal amount of the Term Loans, by delivering a
Commitment Amount Increase Request substantially in the form attached hereto
as
Exhibit H or in such other form reasonably acceptable to the Administrative
Agent at least ten (10) Business Days prior to the stated effective date of
such
increase (the “Commitment
Amount Increase”) identifying any additional Lender(s) (or additional
Revolving Credit Commitment or Term Loans for existing Lender(s)) and the amount
of its Revolving Credit Commitment or Term Loans (or additional amount of its
Revolving Credit Commitment(s) or Term Loans); provided, however, that
(i) any increase shall be in an amount not less than $10,000,000 and for
all such increases shall not exceed $50,000,000 in the aggregate, (ii) any
additional Term Loans advanced hereunder shall be on the same terms and
conditions as the Term Loans except that the Borrowers and the Lenders providing
such additional Term Loans may determine the interest rate applicable to such
additional Term Loans, and (iii) if the Borrowers invite additional Lenders
to
join this Agreement, such additional Lenders shall enter into such joinder
agreements to give effect thereto as the Administrative Agent may reasonably
request. The effective date of any Commitment Amount Increase shall
be agreed upon by the Borrowers and the Administrative Agent. It
shall be a condition to such effectiveness that either no Eurocurrency Loans
be
outstanding on the date of such effectiveness or the Borrowers pay any
applicable breakage cost under Section 1.12 incurred by any Lender
resulting from the repayment of the applicable Loans. The Borrowers
agree to pay any reasonable expenses of the Administrative Agent relating to
any
Commitment Amount Increase. Notwithstanding anything herein to the
contrary, no Lender shall have any obligation to increase its Revolving Credit
Commitment or advance additional Term Loans and no Lender’s Revolving Credit
Commitment shall be increased without its consent thereto, and each Lender
may
at its option, unconditionally and without cause, decline to increase its
Revolving Credit Commitment or advance additional Term Loans. Any
additional Term Loan advanced under this Section 1.17 shall be a “Term Loan” for all purposes
of this Agreement.
16
Section 1.18. Defaulting
Lenders. Anything contained herein to the contrary
notwithstanding, in the event that any Lender at any time is a Defaulting
Lender, then (a) during any Default Period with respect to such Defaulting
Lender, such Defaulting Lender shall be deemed not to be a “Lender” for purposes of
voting on any matters (including the granting of any consents or waivers) with
respect to any of the Loan Documents; (b) to the extent permitted by applicable
law, until such time as the Default Excess with respect to such Defaulting
Lender shall have been reduced to zero, any voluntary prepayment of the Loans
shall, if the Administrative Agent so directs at the time of receiving such
voluntary prepayment, be applied to the Loans of the other Lenders as if such
Defaulting Lender had no Loans outstanding; (c) such Defaulting Lender’s
Commitments and outstanding Loans shall be excluded for purposes of calculating
any commitment fee payable to Lenders pursuant to Section 2.1 in respect of
any day during any Default Period with respect to such Defaulting Lender, and
such Defaulting Lender shall not be entitled to receive any fee pursuant to
Section 2.1 with respect to such Defaulting Lender’s Commitment in respect
of any Default Period with respect to such Defaulting Lender (and any Letter
of
Credit fee otherwise payable to a Lender who is a Defaulting Lender shall
instead be paid to the Company in the event that the Company has delivered
to
the L/C Issuer cash collateral pursuant to clause (e) below or, if such cash
collateral has not been delivered, to the L/C Issuer for its use and benefit);
(d) the utilization of Commitments as at any date of determination shall be
calculated as if such Defaulting Lender had funded all Loans of such Defaulting
Lender; and (e) if so requested by the L/C Issuer at any time during the
Default Period with respect to such Defaulting Lender, the Borrowers shall
deliver to the Administrative Agent cash collateral in an amount equal to such
Defaulting Lender’s Percentage of L/C Obligations then outstanding (to be held
by the Administrative Agent as set forth in Section 9.4
hereof). No Commitment of any Lender shall be increased or otherwise
affected, and, except as otherwise expressly provided in this Section 1.18,
performance by the Borrowers of their obligations hereunder and the other Loan
Documents shall not be excused or otherwise modified as a result of the
operation of this Section 1.18. The rights and remedies against
a Defaulting Lender under this Section 1.18 are in addition to other rights
and remedies which the Borrowers may have against such Defaulting Lender and
which the Administrative Agent or any Lender may have against such Defaulting
Lender.
Section 2.1. Fees. (a) Revolving
Credit Commitment
Fee. The Borrowers shall pay to the Administrative Agent for
the ratable account of the Lenders in accordance with their Revolver Percentages
a commitment fee at the rate per annum equal to the Applicable Margin (computed
on the basis of a year of 360 days and the actual number of days elapsed)
on the average daily Unused Revolving Credit Commitments. Such
commitment fee shall be payable quarter-annually in arrears on the last day
of
each March, June, September, and December in each year (commencing on the first
such date occurring after the date hereof) and on the Revolving Credit
Termination Date, unless the Revolving Credit Commitments are terminated in
whole on an earlier date, in which event the commitment fee for the period
to
the date of such termination in whole shall be paid on the date of such
termination.
17
(b) Letter
of Credit Fees. On the date of issuance or extension, or
increase in the amount, of any Letter of Credit pursuant to Section 1.3
hereof, the applicable Borrower shall pay to the L/C Issuer for its own account
a fronting fee equal to 0.25% of the face amount of (or of the increase
in the face amount of) such Letter of Credit. Quarterly in arrears,
on the last day of each March, June, September, and December, commencing
on the
first such date occurring after the date hereof, the Borrower shall pay to
the
Administrative Agent, for the ratable benefit of the Lenders in accordance
with
their Revolver Percentages, a letter of credit fee at a rate per annum equal
to
the Applicable Margin (computed on the basis of a year of 360 days and the
actual number of days elapsed) in effect during each day of such quarter
applied
to the daily average face amount of Letters of Credit outstanding during
such
quarter. In addition, the applicable Borrower shall pay to the L/C
Issuer for its own account the L/C Issuer’s standard issuance, drawing,
negotiation, amendment, assignment, and other administrative fees for each
Letter of Credit established by the L/C Issuer from time to
time.
(c) Upfront
Fees. On
the Closing Date, the Borrowers shall pay to the Administrative Agent, for
the
account of the Lenders, upfront fees in the amounts previously agreed to by
the
Borrowers, the Lenders and the Administrative Agent.
(d) Administrative
Agent
Fees. The Borrowers shall pay to the Administrative Agent, for
its own use and benefit, the arrangement fees and administrative fees agreed
to
between the Administrative Agent and the Borrowers in a fee letter dated as
of
October 17, 2008 or as otherwise agreed to in writing between them.
(e) Audit
Fees. The
Borrowers shall pay to the Administrative Agent for its own use and benefit
charges for audits of the Collateral performed by the Administrative Agent
or
its agents or representatives in such amounts as the Administrative Agent may
from time to time request (the Administrative Agent acknowledging and agreeing
that such charges shall be computed in the same manner as it at the time
customarily uses for the assessment of charges for similar collateral audits);
provided, however, that
in the absence of any Default and Event of Default, the Borrowers shall not
be
required to pay the Administrative Agent for more than one such audit per
calendar year.
Section 3.1. Place
and Application of Payments. All payments of principal of and
interest on the Loans and the Reimbursement Obligations, and of all other
Obligations payable by the Borrowers under this Agreement and the other Loan
Documents, shall be made by the Borrowers to the Administrative Agent by no
later than 12:00 Noon (Chicago time) on the due date thereof at the office
of the Administrative Agent in Chicago, Illinois (or such other location as
the
Administrative Agent may designate to the Company, on behalf of the
Borrowers), for the benefit of the Lender
or Lenders entitled thereto. Any payments received after such time
shall be deemed to have been received by the Administrative Agent on the next
Business Day. All such payments shall be made in U.S. Dollars, in
immediately available funds at the place of payment, in each case without set-off or
counterclaim. The Administrative Agent will promptly thereafter cause
to be distributed like funds relating to the payment of principal or interest
on
Loans and on Reimbursement Obligations in which the Lenders have purchased
Participating Interests ratably to the Lenders and like funds relating to the
payment of any other amount payable to any Lender to such Lender, in each case
to be applied in accordance with the terms of this Agreement. If the
Administrative Agent causes amounts to be distributed to the Lenders in reliance
upon the assumption that the Borrowers will make a scheduled payment and such
scheduled payment isnot so made, each Lender shall, on
demand, repay to the Administrative Agent the amount distributed to such Lender
together with interest thereon in respect of each day during the period
commencing on the date such amount was distributed to such Lender and ending
on
(but excluding) the date such Lender repays such amount to the Administrative
Agent, at a rate per annum equal to: (i) from the date the
distribution was made to the date 2 Business Days after payment by such Lender
is due hereunder, the Federal Funds Rate for each such day and (ii) from
the date 2 Business Days after the date such payment is due from such Lender
to
the date such payment is made by such Lender, the Base Rate in effect for each
such day.
18
Anything
contained herein to the contrary notwithstanding (including, without limitation,
Section 1.9(b) hereof), all payments and collections received in respect of
the Obligations and all proceeds of the Collateral received, in each instance,
by the Administrative Agent or any of the Lenders after acceleration or the
final maturity of the Obligations or termination of the Commitments as a result
of an Event of Default shall be remitted to the Administrative Agent and
distributed as follows:
(a) first,
to the payment of any outstanding costs and expenses incurred by the
Administrative Agent, and any security trustee therefor, in monitoring,
verifying, protecting, preserving or enforcing the Liens on the Collateral, in protecting,
preserving or enforcing rights under the Loan Documents, and in any event
including all costs and expenses of a character which the Borrowers have agreed
to pay the Administrative Agent or the Lenders under Section 13.15 hereof
(such funds to be retained by the Administrative Agent for its own account
unless it has previously been reimbursed for such costs and expenses by the
Lenders, in which event such amounts shall be remitted to the Lenders to
reimburse them for payments theretofore made to the Administrative
Agent);
(b) second,
to the payment of the Swing Loans, both for principal and accrued but unpaid
interest;
(c) third,
to the payment of any outstanding interest and fees due under the Loan Documents
to be allocated pro rata in accordance with the aggregate unpaid amounts owing
to each holder thereof;
(d) fourth,
to the payment of principal on the Loans (other than Swing Loans), unpaid
Reimbursement Obligations, together with amounts to be held by the
Administrative Agent as collateral security for any outstanding
L/C Obligations pursuant to Section 9.4 hereof (until the
Administrative Agent is holding an amount of cash equal to the then outstanding
amount of all such L/C Obligations), and Hedging Liability, the aggregate
amount paid to, or held as collateral security for, the Lenders and
L/C Issuer and, in the case of Hedging Liability, their Affiliates to be
allocated pro rata in accordance with the aggregate unpaid amounts owing to
each
holder thereof;
(e) fifth,
to the payment of all other unpaid Obligations and all other indebtedness,
obligations, and liabilities of the Borrowers and their Subsidiaries secured
by
the Loan Documents (including, without limitation, Funds Transfer and
DepositAccount Liability) to be allocated pro rata in
accordance with the aggregate unpaid amounts owing to each holder thereof;
and
19
(f) finally,
to the Company, on behalf of the Borrowers, or whoever else may be lawfully
entitled thereto.
Section 3.2. Account
Debit. Each Borrower hereby irrevocably authorizes the
Administrative Agent to charge any of such Borrower’s deposit accounts
maintained with the Administrative Agent for the amounts from time to time
necessary to pay any then due Obligations; provided that the
Borrowers
acknowledge and agree that the Administrative Agent shall not be under an
obligation to do so and the Administrative Agent shall not incur any liability
to the Borrowers or any other Person for the Administrative Agent’s failure to
do so.
Section 4.1. Collateral. The
Obligations, Hedging Liability, and Funds Transfer and Deposit Account Liability
shall be secured by (a) valid, perfected and enforceable Liens on all
right, title, and interest of the Company and each Subsidiary in all capital
stock and other equity interests held by such Person in each of its
Subsidiaries, whether now owned or hereafter formed or acquired, and all
proceeds thereof, and (b) valid, perfected, and enforceable Liens on all
right, title, and interest of the Company and each Domestic Subsidiary in all
of
their accounts, chattel paper, instruments, documents, general intangibles,
letter-of-credit rights, supporting obligations, deposit accounts, investment
property, inventory, equipment, fixtures, commercial tort claims and certain
other Property, whether now owned or hereafter acquired or arising, and all
proceeds thereof (the “Collateral”); provided,
however,
that: (i) until a Default or Event of Default has
occurred and is continuing and thereafter until otherwise required by the
Administrative Agent or the Required Lenders, Liens on local xxxxx cash accounts
maintained by the Company and its Subsidiaries in proximity to their operations
need not be perfected, provided that the total
amount on deposit at any one time not so perfected shall not exceed $1,000,000
in the aggregate and Liens on payroll accounts maintained by the Company and
its
Subsidiaries need not be perfected provided the total amount on deposit at
any
time does not exceed the current amount of their payroll obligations,
(ii) unless otherwise required by the Administrative Agent or the Required
Lenders during the existence of any Event of Default, Liens on the Voting Stock
of a Foreign Subsidiary which, if granted, would cause a material adverse effect
on the Company’s federal income tax liability shall be limited to 65% of the
total outstanding Voting Stock of such Foreign Subsidiary, (iii) unless
otherwise required by the Administrative Agent or the Required Lenders during
the existence of any Event of Default, Liens need not be granted on the
Collateral of a Foreign Subsidiary which, if granted, would cause a material
adverse effect on the Company’s federal income tax liability, (iv) unless
otherwise required by the Administrative Agent or the Required Lenders, Foreign
Subsidiaries need not grant to the Administrative Agent Liens on the capital
stock or other equity interests held by such Foreign Subsidiary in another
Foreign Subsidiary, and (v) until a Default or Event of Default has
occurred and is continuing and thereafter until otherwise required by the
Administrative Agent or the Required Lenders, Liens on U.S. general intangibles,
to the extent perfected by recording an instrument with the U.S. Patent and
Trademark Office, need only be perfected on material U.S. general
intangibles. The Borrowers and Guarantors acknowledge and agree that
the Liens on the Collateral shall begranted to the
Administrative Agent for the benefit of the holders of the Obligations, the
Hedging Liability, and the Funds Transfer and Deposit Account Liability and
shall be valid and perfected first priority Liens subject however, to the
proviso appearing at the end of the preceding sentence and to Liens permitted
by
Section 8.8 hereof, in each case, pursuant to one or more Collateral
Documents from such Persons, each in form and substance satisfactory to the
Administrative Agent.
20
Section 4.2. Guaranties. The
payment and performance of the Obligations, Hedging Liability, and Funds
Transfer and Deposit Account Liability shall at all times be guaranteed by
each
direct and indirect Subsidiary of the Company (other than the Borrowers)
pursuant to Section 12 hereof or pursuant to one or more guaranty
agreements in form and substance acceptable to the Administrative Agent, as
the
same may be amended, modified, or supplemented from time to time (individually
a
“Guaranty” and
collectively, the “Guaranties”, and the Company
and each such Subsidiary executing and delivering this Agreement as a Guarantor
(including any Subsidiary hereafter executing and delivering an Additional
Guarantor Supplement in the form called for by Section 12 hereof) or a separate
Guaranty being referred to herein as a “Guarantor” and collectively
the “Guarantors”);
provided,
however, that
unless otherwise required by the Administrative Agent or the Required Lenders
during the existence of any Event of Default, a Foreign Subsidiary shall not
be
required to be a guarantor hereunder if providing such Guaranty would cause
a
material adverse effect on the Company’s federal income tax
liability.
Section 4.3. Joint
and Several Obligors. The payment and performance of the
Obligations, Hedging Liability and Funds Transfer and Deposit Account Liability
shall at all times be a joint and several obligation of each Borrower pursuant
to Section 12.10 hereof.
Section 4.4. Further
Assurances. The Company and each other Borrower agree that
each shall, and shall cause each of its Subsidiaries to, from time to time
at
the request of the Administrative Agent or the Required Lenders, execute and
deliver such documents and do such acts and things as the Administrative Agent
or the Required Lenders may reasonably request in order to provide for and
maintain the guarantees contemplated by this Section 4. In the
event the Company, any other Borrower or any other Subsidiary of the Company
forms or acquires any Subsidiary after the date hereof, except as otherwise
provided in Section 4.1 and 4.2 above, the Company and the other Borrowers
shall promptly upon such formation or acquisition cause such newly formed or
acquired Subsidiary to execute a Guaranty and such Collateral Documents as
are
required by this Section 4 and as the Administrative Agent may then
require, and the Company and the Borrowers shall also deliver to the
Administrative Agent, or cause such Subsidiary to deliver to the Administrative
Agent, at the Borrowers’ cost and expense, such other instruments, documents,
certificates, and opinions reasonably required by the Administrative Agent
in
connection therewith.
Section 5.1. Definitions. The
following terms when used herein shall have the following meanings:
21
“Acquired
Business” means the
entity or assets acquired by the Company or any Subsidiary in an Acquisition
after the date hereof.
“Acquisition”
means any
transaction or series of related transactions for the purpose of or resulting,
directly or indirectly, in (a) the acquisition of all or substantially all
of the assets of a Person, or of any business or division of a Person,
(b) the acquisition of in excess of 50% of the capital stock, partnership
interests, membership interests or equity of any Person (other than a Person
that is a Subsidiary), or otherwise causing any Person to become a Subsidiary,
or (c) a merger or consolidation or any other combination with another
Person (other than a Person that is a Subsidiary) provided that a Borrower
or a
Subsidiary of a Borrower is the surviving entity.
“Additional
Guarantor
Supplement” means a letter to the Administrative Agent in the form
attached hereto as Exhibit F executed by a Subsidiary of the Company after
the date hereof whereby it acknowledges that it is a party hereto as a Guarantor
and is liable for the Obligations pursuant to Section 12
hereof.
“Adjusted
EBITDA” means, with
reference to any period, the sum of (a) the EBITDA of the Company and its
Subsidiaries for such period, plus(without
duplication)
(b) EBITDA of any Person and its subsidiaries acquired pursuant to
Section 8.9(k) hereof for such period (as if any such Permitted Acquisition
had occurred on the first day of such period), plus (c) adjustments
associated with any Permitted Acquisition to the extent reasonably acceptable
to
the Administrative Agent, plus
(d) non-recurring
costs and extraordinary expenses incurred during the
fiscal year ended December 31, 2007 in connection with the recall of specific
components from the Xxxxxx and Friends product line in an aggregate amount
not
to exceed $28,300,000, plus
(e) other fees, costs
and expenses incurred or provided for (minus
rebates and other reimbursements) related to the recall of specific components
from the Xxxxxx and Friends product line not to exceed $5,000,000 during the
fiscal year ending December 31, 2008,
plus (f) non-recurring
costs in connection with the settlement of claims with HIT Entertainment in
an
aggregate amount not to exceed $15,000,000, plus (g) losses on the
sale, transfer or disposition of Property during such period, plus (h) non-recurring
costs in connection with the termination of the purchase agreement for the
children’s book division of Publications International, Limited in an aggregate
amount not to exceed $2,000,000, plus (i)
non-cash charges
relating to the write-down of the Company’s investment in Meteor the Monster
Truck, Inc. not to exceed $2,100,000 in the aggregate, minus (j) gains on the
sale
or transfer of Property during such period, minus (k) EBITDA of any
Person and its subsidiaries sold, transferred or otherwise disposed of during
such period (as if any such sale, transfer or disposition had occurred on the
first day of such period).
“Adjusted
LIBOR” means, for
any Borrowing of Eurocurrency Loans, a rate per annum determined in accordance
with the following formula:
Adjusted
LIBOR =
LIBOR
1
-
Eurocurrency Reserve Percentage
“Administrative
Agent” means
Bank of Montreal and any successor pursuant to Section 11.7
hereof.
22
“Administrative
Questionnaire” means an Administrative Questionnaire in a form supplied
by the Administrative Agent.
“Affiliate”
means any Person
directly or indirectly controlling or controlled by, or under direct or indirect
common control with, another Person. A Person shall be deemed to
control another Person for the purposes of this definition if such Person
possesses, directly or indirectly, the power to direct, or cause the direction
of, the management and policies of the other Person, whether through the
ownership of voting securities, common directors, trustees or officers, by
contract or otherwise; provided that, in any event
for purposes of this definition, any Person that owns, directly or indirectly,
10% or more of the securities having the ordinary voting power for the election
of directors or governing body of a corporation or 10% or more of the
partnership or other ownership interest of any other Person (other than as
a
limited partner of such other Person) will be deemed to control such corporation
or other Person.
“Agreement”
means this Credit
Agreement, as the same may be amended, modified, restated or supplemented from
time to time pursuant to the terms hereof.
“Applicable
Margin” means,
with respect to Loans, Reimbursement Obligations, and the commitment fees and
letter of credit fees payable under Section 2.1 hereof until the first
Pricing Date, the rates per annum shown opposite Level IV below, and
thereafter from one Pricing Date to the next the Applicable Margin means the
rates per annum determined in accordance with the following
schedule:
Level
|
Leverage
Ratio for Such Pricing Date
|
Applicable
Margin for Base Rate Loans under revolving credit and Term Credit
and
Reimbursement Obligations shall be:
|
Applicable
Margin for Eurodollar Loans under Revolving credit and Term Credit
and
Letter of credit Fee Shall Be:
|
Applicable
Margin for Commitment Fee Shall Be:
|
V
|
Greater
than or equal to 2.25 to 1.0
|
2.25%
|
3.25%
|
0.50%
|
IV
|
Less
than 2.25 to 1.0, but greater than or equal to 1.75 to 1.0
|
2.00%
|
3.00%
|
0.50%
|
III
|
Less
than 1.75 to 1.0, but greater than or equal to 1.25 to 1.0
|
1.75%
|
2.75%
|
0.50%
|
II
|
Less
than 1.25 to 1.0, but greater than or equal to 0.75 to 1.0
|
1.50%
|
2.50%
|
0.50%
|
I
|
Less
than 0.75 to 1.0
|
1.25%
|
2.25%
|
0.45%
|
For
purposes hereof, the term “Pricing Date” means, for any
fiscal quarter of the Borrowers ending on or after December 31, 2008, the date
on which the Administrative Agent is in receipt of the Borrowers’ most recent
financial statements (and, in the case of the year-end financial statements,
audit report) for the fiscal quarter then ended, pursuant to
Section 8.5 hereof. The Applicable Margin shall be
established based on the Leverage Ratio for the most recently completed fiscal
quarter and the Applicable Margin established on a Pricing Date shall remain
in
effect until the next Pricing Date. If the Borrowers have not
delivered their financial statements by the date such financial statements
(and,
in the case of the year-end financial statements, audit report) are required
to
be delivered under Section 8.5 hereof, until such financial statements and
audit report are delivered, the Applicable Margin shall be the highest
Applicable Margin (i.e., Level V shall
apply). If the Borrowers subsequently deliver such financial
statements before the next Pricing Date, the Applicable Margin established
by
such late delivered financial statements shall take effect from the date of
delivery until the next Pricing Date. In all other circumstances, the
Applicable Margin established by such financial statements shall be in effect
from the Pricing Date that occurs immediately after the end of the fiscal
quarter covered by such financial statements until the next Pricing
Date. Each determination of the Applicable Margin made by the
Administrative Agent in accordance with the foregoing shall be conclusive and
binding on the Borrowers and the Lenders if reasonably determined.
Notwithstanding
the foregoing, in the event that any financial statement or compliance
certificate delivered pursuant to Section 8.5(j) hereof is shown to be
inaccurate at any time this Agreement is in effect (due to an error made by
the
Company, and not as a result of a change in GAAP) and as a result of such
inaccuracy the Company is required to restate such financial statements
(regardless of whether (i) the Revolving Credit Commitments are in effect
or (ii) any Loan or other extension of credit is outstanding when such
inaccuracy is discovered or such financial statement or compliance certificate
was delivered), and such inaccuracy, if corrected, would have led to the
application of a higher Applicable Margin for any period (an “Applicable Period”) than the
Applicable Margin applied for such Applicable Period, then (x) the
Borrowersshall promptly deliver to the Administrative Agent
a correct compliance certificate for such Applicable Period, (y) the
Applicable Margin for such Applicable Period shall be determined as if the
Leverage Ratio in the corrected compliance certificate were applicable for
such
Applicable Period, and (z) the Borrowers shall promptly, but in any event
within five (5) Business Days, pay to the Lenders the accrued additional
interest (but not overdue interest) owing as a result of such increased
Applicable Margin for such Applicable Period.
23
“Application”
is defined in
Section 1.3(b) hereof.
“Approved
Fund” means any
Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a
Lender or (c) an entity or an Affiliate of an entity that administers or manages
a Lender.
“Assignment
and Acceptance”
means an assignment and acceptance entered into by a Lender and an Eligible
Assignee (with the consent of any party whose consent is required by
Section 13.12 hereof), and accepted by the Administrative Agent, in
substantially the form of Exhibit G or any other form approved by the
Administrative Agent.
“Authorized
Representative”
means those persons shown on the list of officers provided by the Borrowers
pursuant to Section 7.2 hereof or on any update of any such list provided
by the Borrowers to the Administrative Agent, or any further or different
officers of any Borrower so named by any Authorized Representative of such
Borrower in a written notice to the Administrative Agent.
“Base
Rate” means for any day
the greatest of: (i) the rate of interest announced or otherwise
established by the Administrative Agent from time to time as its prime
commercial rate, or its equivalent, for U.S. Dollar loans to borrowers located
in the United States as in effect on such
day, with any change in the Base Rate resulting from a change in said prime
commercial rate to be effective as of the date of the relevant change in said
prime commercial rate (it being acknowledged and agreed that such rate may
not
be the Administrative Agent’s best or lowest rate), (ii) the sum of
(x) the rate determined by the Administrative Agent to be the average
(rounded upward, if necessary, to the next higher 1/100 of 1%) of the rates
per
annum quoted to the Administrative Agent at approximately 10:00 a.m.
(Chicago time) (or as soon thereafter as is practicable) on such day (or, if
such day is not a Business Day, on the immediately preceding Business Day)
by
two or more Federal funds brokers selected by the Administrative Agent for
sale
to the Administrative Agent at face value of Federal funds in the secondary
market in an amount equal or comparable to the principal amount for which such
rate is being determined, plus (y) 1/2 of 1%, and
(iii) the LIBOR Quoted Rate for such day plus 1.00%. As
used herein, the term “LIBOR
Quoted Rate” means, for any date, the rate per annum determined by a
fraction, the numerator of which is the rate per annum (rounded upwards, if
necessary, to the next higher one hundred-thousandth of a percentage point)
for
deposits in U.S. Dollars for an Interest Period equal to one month, which
appears on the LIBOR01 Page as of 11:00 a.m. (London, England time) on such
date
and the denominator of which is 1 minus the Eurodollar Reserve
Percentage.
“Base
Rate Loan” means a Loan
bearing interest at a rate specified in Section 1.4(a) hereof.
24
“Borrowers”
is defined in the
introductory paragraph of this Agreement.
“Borrowing”
means the total
of Loans of a single type advanced, continued for an additional Interest Period,
or converted from a different type into such type by the Lenders under a Credit
on a single date and, in the case of Eurocurrency Loans, for a single Interest
Period. Borrowings of Loans are made and maintained ratably from each
of the Lenders under a Credit according to their Percentages of such
Credit. A Borrowing is “advanced” on the day Lenders
advance funds comprising such Borrowing to the applicable Borrower, is “continued” on the date a new
Interest Period for the same type of Loans commences for such Borrowing, and
is
“converted” when such
Borrowing is changed from one type of Loans to the other, all as requested
by
the Company, on behalf of the Borrowers, pursuant to Section 1.6(a)
hereof. Borrowings of Swing Loans are made by the Swing Line Lender
in accordance with the procedures set forth in Section 1.16
hereof.
“Business
Day”means any day (other
than a Saturday or Sunday) on which banks are not authorized or required to
close in Chicago, Illinois and, if the applicable Business Day relates to
the advance or continuation of, or conversion into, or payment of a Eurocurrency
Loan, on which banks are dealing in U.S. Dollar deposits in the interbank
Eurocurrency market in London, England and Nassau, Bahamas.
“Capital
Expenditures” means,
with respect to any period, the aggregate amount of all expenditures (whether
paid in cash or accrued as a liability) by the Company and its Subsidiaries
during that period for the acquisition or leasing (pursuant to a Capital Lease)
of fixed or capital assets or additions to property, plant, or equipment
(including replacements, capitalized repairs, and improvements) which should
be
capitalized on the balance sheet of the Company and its Subsidiaries in
accordance with GAAP.
“Capital
Lease” means any
lease of Property which in accordance with GAAP is required to be capitalized
on
the balance sheet of the lessee.
“Capitalized
Lease
Obligation” means, for any Person, the amount of the liability shown on
the balance sheet of such Person in respect of a Capital Lease determined in
accordance with GAAP.
“CERCLA”
means
the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
as
amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C.
§§9601 et
seq., and any future
amendments.
“Change
of Control” means any
of (a) the acquisition by any “person” or “group”
(as such terms are
used in sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended) at any time of beneficial ownership of 33-1/3% or more of the
outstanding capital stock or other equity interest of the Company on a
fully-diluted basis, (b) the failure of the Company to own 100% of the
Voting Stock of any Borrower, (c) the failure of individuals who are
members of the board of directors (or similar governing body) of the Company
or
any Borrower on the Closing Date (together with any new or replacement directors
whose initial nomination for election was approved by a majority of the
directors who were either directors on the Closing Date or previously so
approved) to constitute a majority of the board of directors (orsimilar governing body) of the Company or such Borrower,
as the case may
be, or (d) any “Change of Control” (or words of like import), as defined in
any agreement or indenture relating to any issue of Indebtedness for Borrowed
Money shall occur.
25
“Closing
Date” means the date
of this Agreement or such later Business Day upon which each condition described
in Section 7.2 shall be satisfied or waived in a manner acceptable to the
Administrative Agent in its discretion.
“Code”
means the Internal
Revenue Code of 1986, as amended, and any successor statute
thereto.
“Collateral”
means all
properties, rights, interests, and privileges from time to time subject to
the
Liens granted to the Administrative Agent, or any security trustee therefor,
by
the Collateral Documents.
“Collateral
Account” is
defined in Section 9.4 hereof.
“Collateral
Documents” means
the Security Agreement, and all other security agreements, pledge agreements,
assignments, financing statements and other documents as shall from time to
time
secure or relate to the Obligations, the Hedging Liability, and the Funds
Transfer and Deposit Account Liability or any part thereof.
“Commitment
Amount Increase”
is defined in Section 1.17 hereof.
“Commitment
Amount Increase
Request” means a Commitment Amount Increase Request in the form of
Exhibit H hereto.
“Commitments”
means the
Revolving Credit Commitments and Term Loan Commitments.
“Company”
is defined in the
introductory paragraph of this Agreement.
“Controlled
Group” means all
members of a controlled group of corporations and all trades or businesses
(whether or not incorporated) under common control which, together with the
Borrower, are treated as a single employer under Section 414 of the
Code.
“Credit”
means any of the
Revolving Credit, the Term Credit or the Swing Line.
“Credit
Event” means the
advancing of any Loan, or extension of the expiration date or increase in the
amount of, any Letter of Credit.
“Credit
Parties” means,
collectively, the Borrowers and the Guarantors.
“Default”
means any event or
condition the occurrence of which would, with the passage of time or the giving
of notice, or both, constitute an Event of Default.
“Designated
Disbursement
Account” means collectively, the accounts of each Borrower maintained
with the Administrative Agent or its Affiliate and designated in writing to
theAdministrative Agent as such Borrower’s Designated
Disbursement Account (or such other account as the Company, on behalf of such
Borrower, and the Administrative Agent may otherwise agree).
26
“Defaulting
Lender” means any
Lender that (a) has failed to fund any portion of the Loans, participations
in L/C Obligations or participations in Swing Loans required to be funded by
it
hereunder (herein, a “Defaulted Loan”) within
two (2) Business Days of the date required to be funded by it hereunder
unless such failure has been cured, (b) has otherwise failed to pay over to
the Administrative Agent or any other Lender any other amount required to paid
by it hereunder within two (2) Business Days of the date when due, unless
the subject of a good faith dispute or unless such failure has been cured,
or
(c) has been deemed insolvent or become the subject of a bankruptcy or
insolvency proceeding or a receiver or conservator has been appointed for such
Lender.
“Default
Excess” means, with
respect to any Defaulting Lender, the excess, if any, of such Defaulting
Lender’s Percentage of the aggregate outstanding principal amount of Loans of
all Lenders (calculated as if all Defaulting Lenders other than such Defaulting
Lender had funded all of their respective Defaulted Loans) over the aggregate
outstanding principal amount of all Loans of such Defaulting
Lender.
“Defaulting
Lender” has the
meaning set forth in Section 1.18.
“Default
Period” means, with
respect to any Defaulting Lender, the period commencing on the date upon which
such Lender first became a Defaulting Lender and ending on the earliest of
the
following dates: (i) the date on which all Commitments are
cancelled or terminated and/or the Obligations are declared or become
immediately due and payable and (ii) the date on which (a) the Default
Excess with respect to such Defaulting Lender shall have been reduced to zero
(whether by the funding by such Defaulting Lender of any Defaulted Loans of
such
Defaulting Lender or otherwise) and (b) such Defaulting Lender shall have
delivered to the Company and the Administrative Agent a written reaffirmation
of
such Defaulting Lender’s intention to honor its obligations hereunder with
respect to its Commitments.
“Disposition”
means the sale,
lease, conveyance or other disposition of Property, other than sales or other
dispositions expressly permitted under subsections (a) through (f) of
Section 8.10 hereof.
“Domestic
Borrower” means
collectively the Company and each Borrower that is a Domestic
Subsidiary.
“Domestic
Subsidiary” means
each Subsidiary that is not a Foreign Subsidiary.
“EBITDA”
means, for any
Person and with reference to any period, Net Income of such Person and its
subsidiaries for such period plus the sum of all amounts
deducted in arriving at such Net Income amount in respect of (a) Interest
Expense of such Person and its subsidiaries for such period, (b) federal,
state, and local income taxes for such period of such Person and its
subsidiaries for such period, (c) depreciation of fixed assets and
amortization of intangible assets of such Person and its subsidiaries for such
period, and (d) non-cash expenses related to equity awards.
27
“Eligible
Assignee” means
(a) a Lender, (b) an Affiliate of a Lender, (c) an Approved Fund,
and (d) any other Person (other than a natural person) approved by
(i) the Administrative Agent, (ii) in the case of any assignment of a
Revolving Credit Commitment, the L/C Issuer, and (iii) unless an Event
of Default has occurred and is continuing, the Borrowers (each such approval
not
to be unreasonably withheld or delayed); provided that notwithstanding
the foregoing, “Eligible Assignee” shall not include any Borrower or Guarantor
or any of such Borrower’s or Guarantor’s Affiliates or
Subsidiaries.
“Eligible
Line of Business”
means any business engaged in as of the date of this Agreement by the Credit
Parties or any of their Subsidiaries or any business substantially similar
thereto.
“Environmental
Law” means any
current or future Legal Requirement pertaining to (a) the protection of health,
safety and the indoor or outdoor environment, (b) the conservation, management
or use of natural resources and wildlife, (c) the protection or use of surface
water or groundwater, (d) the management, manufacture, possession, presence,
use, generation, transportation, treatment, storage, disposal, release,
threatened release, abatement, removal, remediation or handling of, or exposure
to, any Hazardous Material or (e) pollution (including any release to air,
land,
surface water or groundwater), and any amendment, rule, regulation, order or
directive issued thereunder.
“ERISA”
means the Employee
Retirement Income Security Act of 1974, as amended, or any successor statute
thereto.
“Eurocurrency
Loan” means a
Loan bearing interest at the rate specified in Section 1.4(b)
hereof.
“Eurocurrency
Reserve
Percentage” means, for any Borrowing of Eurocurrency Loans, the daily
average for the applicable Interest Period of the maximum rate, expressed as
a
decimal, at which reserves (including, without limitation, any supplemental,
marginal, and emergency reserves) are imposed during such Interest Period by
the
Board of Governors of the Federal Reserve System (or any successor) on “eurocurrency liabilities”,
as defined in such Board’s Regulation D (or in respect of any other
category of liabilities that includes deposits by reference to which the
interest rate on Eurocurrency Loans is determined or any category of extensions
of credit or other assets that include loans by non-United States offices of
any
Lender to United States residents), subject to any amendments of such reserve
requirement by such Board or its successor, taking into account any transitional
adjustments thereto. For purposes of this definition, the
Eurocurrency Loans shall be deemed to be “eurocurrency liabilities” as
defined in Regulation D without benefit or credit for any prorations,
exemptions or offsets under Regulation D.
“Event
of Default” means any
event or condition identified as such in Section 9.1 hereof.
“Event
of Loss” means, with
respect to any Property consisting of real estate, furniture, fixtures,
equipment or other fixed assets, any of the following: (a) any
loss, destruction or damage of such Property or (b) any condemnation,
seizure, or taking, by exercise of the power ofeminent
domain or otherwise, of such Property, or confiscation of such Property or
the
requisition of the use of such Property.
28
“Existing
Credit Agreement”
means that certain Amended and Restated Credit Agreement dated as of September
15, 2004, as amended, by and among LCBI, Learning Curve International, Inc.,
The
First Years Inc., Racing Champions Worldwide Limited, the Guarantors party
thereto, the lenders party thereto and Xxxxxx X.X., as administrative
agent.
“Existing
L/Cs” means the
letters of credit issued and outstanding under the Existing Credit
Agreement.
“Federal
Funds Rate” means
the fluctuating interest rate per annum described in part (x) of clause (ii)
of
the definition of Base Rate.
“Fixed
Charge Coverage Ratio”
means, at any time the same is to be determined, the ratio of (a) Adjusted
EBITDA of the Company for the four consecutive fiscal quarters of the Company
then ended minus
Capital Expenditures during the same four fiscal quarters then ended to
(b) Fixed Charges made during the same four fiscal quarters then
ended.
“Fixed
Charges” means, with
reference to any period, the sum of (a) all scheduled payments of principal
during such period with respect to Indebtedness for Borrowed Money of the
Company and its Subsidiaries, (b) cash Interest Expense for the Company and
its Subsidiaries for such period, (c) federal, state, and local income
taxes paid or payable in cash by the Company and its Subsidiaries during such
period, net of cash refunds received or receivable by the Company or any
Subsidiary during such period, all as disclosed on the Company’s cash flow
statement, and (d) Restricted Payments permitted by Section 8.12(iii) hereof paid in cash
during such period.
“Foreign
Borrower” means each
Borrower that is a Foreign Subsidiary.
“Foreign
Subsidiary” means
each Subsidiary which (a) is organized under the laws of a jurisdiction
other than the United States of America or any state thereof or the District
of
Columbia, (b) conducts substantially all of its business outside of the
United States of America, and (c) has substantially all of its assets
outside of the United States of America.
“Fund”
means
any Person
(other than a natural person) that is (or will be) engaged in making,
purchasing, holding or otherwise investing in commercial loans and similar
extensions of credit in the ordinary course of its business.
“Funds
Transfer and Deposit Account
Liability” means the liability of a Borrower or any of its Subsidiaries
owing to any of the Lenders, or any Affiliates of such Lenders, arising out
of
(a) the execution or processing of electronic transfers of funds by
automatic clearing house transfer, wire transfer or otherwise to or from the
deposit accounts of a Borrower and/or any Subsidiary now or hereafter maintained
with any of the Lenders or their Affiliates, (b) the acceptance for deposit
or the honoring for payment of any check, draft or other item with respect
to
any such deposit accounts, and (c) any other deposit, disbursement, and
cash management services afforded to a Borrower or any Subsidiary by any of
such
Lenders or their Affiliates.
29
“GAAP”
means generally
accepted accounting principles set forth from time to time in the opinions
and
pronouncements of the Accounting Principles Board and the American Institute
of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board (or agencies with similar functions of comparable
stature and authority within the U.S. accounting profession), which are
applicable to the circumstances as of the date of determination.
“Guarantor”
and
“Guarantors”
each is defined
in Section 4.2 hereof.
“Guaranty”
and “Guaranties” each is defined
in Section 4.2 hereof.
“Hazardous
Material” means
any substance, chemical, compound, product, solid, gas, liquid, waste,
byproduct, pollutant, contaminant or material which is hazardous or toxic,
and
includes, without limitation, (a) asbestos, polychlorinated biphenyls and
petroleum (including crude oil or any fraction thereof) and (b) any material
classified or regulated as “hazardous” or “toxic” or words of like import
pursuant to an Environmental Law.
“Hedging
Liability” means the
liability of a Borrower or any Subsidiary to any of the Lenders, or any
Affiliates of such Lenders, in respect of any interest rate swap agreements,
interest rate cap agreements, interest rate collar agreements, interest rate
floor agreements, interest rate exchange agreements, foreign currency contracts,
currency swap contracts, or other similar interest rate or currency hedging
arrangements as such Borrower or such Subsidiary, as the case may be, may from
time to time enter into with any one or more of the Lenders party to this
Agreement or their Affiliates.
“Hostile
Acquisition” means
the acquisition of the capital stock or other equity interests of a Person
through a tender offer or similar solicitation of the owners of such capital
stock or other equity interests which has not been approved (prior to such
acquisition) by resolutions of the Board of Directors of such Person or by
similar action if such Person is not a corporation, and as to which such
approval has not been withdrawn.
“Indebtedness
for Borrowed
Money” means for any Person (without duplication) (a) all
indebtedness of such Person for borrowed money, whether current or funded,
or
secured or unsecured, (b) all indebtedness for the deferred purchase price
of Property or services, (c) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to Property
acquired by such Person (even though the rights and remedies of the seller
or
lender under such agreement in the event of a default are limited to
repossession or sale of such Property), (d) all indebtedness secured by a
purchase money mortgage or other Lien to secure all or part of the purchase
price of Property subject to such mortgage or Lien, (e) all obligations
under leases which shall have been or must be, in accordance with GAAP, recorded
as Capital Leases in respect of which such Person is liable as lessee,
(f) any liability in respect of banker’s acceptances or letters of credit,
and (g) any indebtedness, whether or not assumed, secured by Liens on
Property acquired by such Person at the time of acquisition thereof, it being
understood that the term “Indebtedness for Borrowed Money” shall not include
trade payables arising in the ordinary course of business.
30
“Interest
Expense” means, for
any Person with reference to any period, the sum of all interest charges
(including imputed interest charges with respect to Capitalized Lease
Obligations and all amortization of debt discount and expense) of such Person
and its subsidiaries for such period determined on a consolidated basis in
accordance with GAAP.
“Interest
Period” is defined
in Section 1.7 hereof.
“L/C
Issuer” means (i) with
respect to the Existing L/Cs, Xxxxxx X.X. and (ii) with respect to all other
L/Cs, the Administrative Agent, or any other Lender requested by the Company,
on
behalf of the Borrowers, and approved by the Administrative Agent in its
reasonable discretion with respect to any Letter of Credit.
“L/C
Obligations”means the
aggregate undrawn face
amounts of all outstanding Letters of Credit and all unpaid Reimbursement
Obligations.
“L/C
Sublimit” means
$20,000,000, as reduced pursuant to the terms hereof.
“Legal
Requirement” means any
treaty, convention, statute, law, regulation, ordinance, license, permit,
governmental approval, injunction, judgment, order, consent decree or other
requirement of any governmental authority, whether federal, state, or
local.
“Lenders”
means and includes
each financial institution party hereto and the other financial institutions
from time to time party to this Agreement, including each assignee Lender
pursuant to Section 13.12 hereof and, unless the context otherwise
requires, the Swing Line Lender.
“Lending
Office” is defined
in Section 10.4 hereof.
“Letter
of Credit” is defined
in Section 1.3(a) hereof.
“Leverage
Ratio” means, at
any time the same is to be determined, the ratio of (i) Total Funded Debt
of the Company and its Subsidiaries as of the last day of the most recently
completed fiscal quarter of the Company to (ii) Adjusted EBITDA of the
Company and its Subsidiaries for the period of four fiscal quarters then
ended.
“LIBOR”
means, for an
Interest Period for a Borrowing of Eurocurrency Loans, (a) the LIBOR Index
Rate for such Interest Period, if such rate is available, and (b) if the
LIBOR Index Rate cannot be determined, the arithmetic average of the rates
of
interest per annum (rounded upwards, if necessary, to the nearest 1/100 of
1%)
at which deposits in U.S. Dollars in immediately available funds are offered
to
the Administrative Agent at 11:00 a.m. (London, England time) two
(2) Business Days before the beginning of such Interest Period by three (3)
or more major banks in the interbank eurocurrency market selected by the
Administrative Agent for delivery on the first day of and for a period equal
to
such Interest Period and in an amount equal or comparable to the principal
amount of the Eurodollar Loan scheduled to be made as part of such
Borrowing.
“LIBOR
Index Rate” means, for
any Interest Period, the rate per annum (rounded upwards, if necessary, to
the
next higher one hundred-thousandth of a percentage point) fordeposits in U.S. Dollars for a period equal to such
Interest Period,
which appears on the appropriate page on the Reuters Service in the relevant
currency (London, England time) on the day 2 Business Days before the
commencement of such Interest Period.
31
“Lien”
means
any mortgage,
lien, security interest, pledge, charge or encumbrance of any kind in respect
of
any Property, including the interests of a vendor or lessor under any
conditional sale, Capital Lease or other title retention
arrangement.
“Loan”
means any Revolving
Loan, Swing Loan or Term Loan, whether outstanding as a Base Rate Loan or
Eurocurrency Loan or otherwise, each of which is a “type” of Loan
hereunder.
“Loan
Documents” means this
Agreement, the Notes (if any), the Applications, the Collateral Documents,
the
Guaranties and each other instrument or document to be delivered hereunder
or
thereunder or otherwise in connection therewith.
“Material
Adverse Effect”
means (a) a material adverse change in, or material adverse effect upon, the
operations, business, Property or, condition (financial or otherwise) of any
Borrower or of the Borrowers and their Subsidiaries taken as a whole, (b) a
material impairment of the ability of any Credit Party to perform its
obligations under any Loan Document or (c) a material adverse effect upon
(i) the legality, validity, binding effect or enforceability against any Credit
Party of any Loan Document or the rights and remedies of the Administrative
Agent and the Lenders thereunder or (ii) the perfection or priority of any
Lien
granted under any Collateral Document.
“Moody’s”
means Xxxxx’x
Investors Service, Inc.
“Net
Cash Proceeds” means, as
applicable, (a) with respect to any Disposition by a Person, cash and cash
equivalent proceeds received by or for such Person’s account, net of (i)
reasonable direct costs relating to such Disposition and (ii) sale, use or
other
transactional taxes paid or payable by such Person as a direct result of such
Disposition; (b) with respect to any Event of Loss of a Person, cash and
cash equivalent proceeds received by or for such Person’s account (whether as a
result of payments made under any applicable insurance policy therefor or in
connection with condemnation proceedings or otherwise), net of
(i) reasonable direct costs incurred in connection with the collection of
such proceeds, awards or other payments, (ii) sale or other transactional
taxes paid or payable by such Person as a direct result of such Event of Loss,
and (iii) amounts required to be applied to repay principal of, premium, if
any, and interest on any Indebtedness for Borrowed Money secured by a Lien
on
the Property (or portion thereof) so damaged or taken (other than the
Obligations hereunder) which is required to be and is repaid in connection
with
such Event of Loss; and (c) with respect to any offering of equity
securities of a Person or the issuance of any Indebtedness for Borrowed Money
by
a Person, cash and cash equivalent proceeds received by or for such
Person’s account, net of reasonable legal, underwriting, and other fees and
expenses incurred as a direct result thereof.
“Net
Income” means, for any
Person and with reference to any period, the net income (or net loss) of such
Person and its subsidiaries for such period computed on a consolidated basis
in
accordance with GAAP; provided that there shall
be
excluded from Net Income (a) the netincome (or net
loss) of any Person accrued prior to the date it becomes a subsidiary of, or
has
merged into or consolidated with, such Person or another subsidiary of such
Person, and (b) the net income (or net loss) of any other Person (other
than a subsidiary of such Person) in which such Person or any subsidiary of
such
Person has an equity interest in, except to the extent of the amount of
dividends or other distributions actually paid to such Person or such subsidiary
during such period.
32
“Note”
and “Notes” each is defined
in
Section 1.11 hereof.
“Obligations”
means all
obligations of the Borrowers, or any of them, to pay principal and interest
on
the Loans, all Reimbursement Obligations owing under the Applications, all
fees
and charges payable hereunder, and all other payment obligations of any Credit
Party arising under or in relation to any Loan Document, in each case whether
now existing or hereafter arising, due or to become due, direct or indirect,
absolute or contingent, and howsoever evidenced, held or acquired.
“Participating
Interest” is
defined in Section 1.3(e) hereof.
“Participating
Lender” is
defined in Section 1.3(e) hereof.
“PBGC”
means the Pension
Benefit Guaranty Corporation or any Person succeeding to any or all of its
functions under ERISA.
“Percentage”
means for any
Lender its Revolver Percentage or Term Loan Percentage, as applicable; and
where
the term “Percentage”
is applied on an
aggregate basis (including, without limitation,
Section 11.6 hereof), such aggregate percentage shall be calculated by
aggregating the separate components of the Revolver Percentage and Term Loan
Percentage, and expressing such components on a single percentage
basis.
“Permitted
Acquisition” means
any Acquisition with respect to which all of the following conditions shall
have
been satisfied:
(a) the
Total Consideration for the Acquired Business does not exceed $15,000,000 and
the Total Consideration for all Acquired Businesses does not exceed $30,000,000
in the aggregate for all Acquisitions completed after the Closing
Date;
(b) the
Acquired Business is an Eligible Line of Business;
(c) the
Acquisition shall not be a Hostile Acquisition;
(d) the
financial statements of the Acquired Business shall have been audited by a
nationally recognized accounting firm or such financial statements shall have
undergone review of a scope satisfactory to the Administrative
Agent;
(e) in
the event of a merger involving the Company, the Company must be the entity
surviving the merger;
33
(f) if
a new Subsidiary is formed or acquired as a result of or in connection with
the
Acquisition, the Borrowers shall have complied with the requirements of
Section 4 hereof in connection therewith;
(g) the
Borrowers shall have delivered to the Administrative Agent evidence reasonably
satisfactory to the Administrative Agent that the Borrowers would have a
Leverage Ratio as of the last day of the last fiscal quarter for which financial
statements have been delivered on a pro forma basis that is at
least 0.25:1.00 below the then maximum Leverage Ratio permitted by
Section 8.21(i) (assuming the indebtedness incurred at the time of such
Acquisition was incurred on the first day of such 12-month period and on a
pro forma basis after giving
effect to such Acquisition);
(h) immediately
prior to and after giving effect to the Acquisition and any Credit Event in
connection therewith, no Default or Event of Default shall exist, including
with
respect to the financial covenants contained in Section 8.21 hereof on a
pro forma basis;
and
(i) after
giving effect to the Acquisition and any Credit Event in connection therewith,
the Borrower shall have not less than $35,000,000 of Unused Revolving Credit
Commitments.
“Person”
means an individual,
partnership, corporation, limited liability company, association, trust,
unincorporated organization or any other entity or organization, including
a
government or agency or political subdivision thereof.
“Plan”
means any employee
pension benefit plan covered by Title IV of ERISA or subject to the minimum
funding standards under Section 412 of the Code that either (a) is
maintained by a member of the Controlled Group for employees of a member of
the
Controlled Group or (b) is maintained pursuant to a collective bargaining
agreement or any other arrangement under which more than one employer makes
contributions and to which a member of the Controlled Group is then making
or
accruing an obligation to make contributions or has within the preceding five
plan years made contributions.
“Property”
means, as to any
Person, all types of real, personal, tangible, intangible or mixed property
owned by such Person whether or not included in the most recent balance sheet
of
such Person and its subsidiaries under GAAP.
“Reimbursement
Obligation” is
defined in Section 1.3(c) hereof.
“Required
Lenders” means, as
of the date of determination thereof, Lenders whose outstanding Loans and
interests in Letters of Credit and Unused Revolving Credit Commitments
constitute more than 50% of the sum of the total outstanding Loans, interests
in
Letters of Credit, and Unused Revolving Credit Commitments of the
Lenders.
“Restricted
Payments” is
defined in Section 8.12 hereof.
“Revolver
Percentage” means,
for each Lender, the percentage of the Revolving Credit Commitments represented
by such Lender’s Revolving Credit Commitment or, if the Revolving Credit
Commitments have been terminated, the percentage held by such Lender
(includingthrough participation interests in Reimbursement
Obligations) of the aggregate principal amount of all Revolving Credit Loans
and
L/C Obligations then outstanding.
34
“Revolving
Credit” means the
credit facility for making Revolving Loans and Swing Loans and issuing Letters
of Credit described in Sections 1.2, 1.3 and 1.16 hereof.
“Revolving
Credit Commitment”
means, as to any Lender, the obligation of such Lender to make Revolving Loans
and to participate in Swing Loans and Letters of Credit issued for the account
of any Borrower hereunder in an aggregate principal or face amount at any one
time outstanding not to exceed the amount set forth opposite such Lender’s name
on Schedule 1 attached hereto and made a part hereof, as the same may be
increased, reduced or modified at any time or from time to time pursuant to
the
terms hereof. The Borrowers and the Lenders acknowledge and agree
that the Revolving Credit Commitments of the Lenders aggregate $70,000,000
on
the date hereof.
“Revolving
Credit Termination
Date” means November 1, 2011, or such earlier date on which the
Revolving Credit Commitments are terminated in whole pursuant to
Section 1.13, 9.2 or 9.3 hereof.
“Revolving
Loan” is defined
in Section 1.2 hereof and, as so defined, includes a Base Rate Loan or a
Eurocurrency Loan, each of which is a “type” of Revolving Loan
under the Revolving Credit.
“Revolving
Note” is defined
in Section 1.11 hereof.
“S&P”
means Standard
& Poor’s Ratings Services Group, a division of The XxXxxx-Xxxx Companies,
Inc.
“SEC”
means the U.S.
Securities and Exchange Commission or any successor agency.
“Security
Agreement” means
that certain Security Agreement dated the date of this Agreement among the
Domestic Borrowers, the Guarantors and the Administrative Agent, as the same
may
be amended, modified, supplemented or restated from time to time.
“Subsidiary”
means, as to any
particular parent corporation or organization, any other corporation or
organization more than 50% of the outstanding Voting Stock of which is at the
time directly or indirectly owned by such parent corporation or organization
or
by any one or more other entities which are themselves subsidiaries of such
parent corporation or organization. Unless otherwise expressly noted
herein, the term “Subsidiary” means a
subsidiary of the Company or any other Credit Party or of any of their direct
or
indirect Subsidiaries, as applicable.
“Swing
Line” means the
credit facility for making one or more Swing Loans described in
Section 1.16 hereof.
“Swing
Line Lender” means BMO
Capital Markets Financing, Inc., acting in its capacity as the Lender of Swing
Loans hereunder, or any successor Lender acting in such capacity appointed
pursuant to Section 13.12 hereof.
35
“Swing
Line Lender’s Quoted
Rate” is defined in Section 1.16(c) hereof.
“Swing
Line Sublimit” means
$10,000,000, as reduced pursuant to the terms hereof.
“Swing
Loan” and “Swing Loans” each is defined
in Section 1.16 hereof.
“Swing
Note” is defined in
Section 1.11 hereof.
“Term
Credit” means the
credit facility for the Term Loans described in Section 1.1(a)
hereof.
“Term
Loan” is defined in
Section 1.1(a) hereof and, as so defined, includes a Base Rate Loan or a
Eurocurrency Loan, each of which is a “type” of Term Loan
hereunder.
“Term
Loan Commitment” means,
as to any Lender, the obligation of such Lender to make its Term Loan on the
Closing Date or thereafter pursuant to Section 1.17 hereof in the principal
amount not to exceed the amount set forth opposite such Lender’s name on
Schedule 1 attached hereto and made a part hereof. The Borrowers
and the Lenders acknowledge and agree that the Term Loan Commitments of the
Lenders aggregate $75,000,000 on the date hereof.
“Term
Loan Percentage” means,
for each Lender, the percentage of the Term Loan Commitments represented by
such
Lender’s Term Loan Commitment or, if the Term Loan Commitments have been
terminated or have expired, the percentage held by such Lender of the aggregate
principal amount of all Term Loans then outstanding.
“Term
Note” is defined in
Section 1.11 hereof.
“Total
Consideration” means
the total amount (but without duplication) of (a) cash paid in connection
with any Acquisition, plus (b) indebtedness payable to the seller in
connection with such Acquisition, plus (c) the fair market value of any
equity securities, including any warrants or options therefor, delivered in
connection with any Acquisition, plus (d) the present value of covenants
not to compete entered into in connection with such Acquisition or other future
payments which are required to be made over a period of time and are not
contingent upon the Company or any Subsidiary meeting financial performance
objectives (exclusive of salaries paid in the ordinary course of business)
(discounted at the Base Rate), but only to the extent not included in
clause (a), (b) or (c) above, plus (e) the amount of indebtedness
assumed in connection with such Acquisition.
“Total
Funded Debt” means, at
any time the same is to be determined, the aggregate of (but without
duplication) all Indebtedness for Borrowed Money of the Company and its
Subsidiaries at such time, including all Indebtedness for Borrowed Money of
any
other Person which is directly or indirectly guaranteed by the Company or any
Subsidiary or which the Company or any Subsidiary has agreed (contingently
or
otherwise) to purchase or otherwise acquire or in respect of which the Company
or any Subsidiary has otherwise assured a creditor against loss.
“Unfunded
Vested
Liabilities” means,
for any Plan at any time, the amount (if any) by which the present value of
all
vested nonforfeitable accrued benefits under such Plan exceeds thefair market value of all Plan assets allocable to such
benefits, all
determined as of the then most recent valuation date for such Plan, but only
to
the extent that such excess represents a potential liability of a member of
the
Controlled Group to the PBGC or the Plan under Title IV of
ERISA.
36
“Unused
Revolving Credit
Commitments” means, at any time, the difference between the Revolving
Credit Commitments then in effect and the aggregate outstanding principal amount
of Revolving Loans and L/C Obligations.
“U.S.
Dollars” and “$” each means
the lawful
currency of the United States of America.
“Voting
Stock” of any Person
means capital stock or other equity interests of any class or classes (however
designated) having ordinary power for the election of directors or other similar
governing body of such Person, other than stock or other equity interests having
such power only by reason of the happening of a contingency.
“Welfare
Plan” means a
“welfare plan” as defined in Section 3(1) of ERISA.
“Wholly-owned
Subsidiary”
means a Subsidiary of which all of the issued and outstanding shares of capital
stock (other than directors’ qualifying shares as required by law) or other
equity interests are owned by any Borrower and/or one or more Wholly-owned
Subsidiaries within the meaning of this definition.
Section 5.2. Interpretation. The
foregoing definitions are equally applicable to both the singular and plural
forms of the terms defined. The words “hereof”, “herein”,
and “hereunder” and words of like
import when used in this Agreement shall refer to this Agreement as a whole
and
not to any particular provision of this Agreement. All references to
time of day herein are references to Chicago, Illinois, time unless otherwise
specifically provided. Where the character or amount of any asset or
liability or item of income or expense is required to be determined or any
consolidation or other accounting computation is required to be made for the
purposes of this Agreement, it shall be done in accordance with GAAP except
where such principles are inconsistent with the specific provisions of this
Agreement.
Section 5.3. Change
in Accounting Principles. If, after the date of this
Agreement, there shall occur any change in GAAP from those used in the
preparation of the financial statements referred to in Section 6.5 hereof
and such change shall result in a change in the method of calculation of any
financial covenant, standard or term found in this Agreement, either the
Borrowers or the Required Lenders may by notice to the Lenders and the
Borrowers, respectively, require that the Lenders and the Borrowers negotiate
in
good faith to amend such covenants, standards, and term so as equitably to
reflect such change in accounting principles, with the desired result being
that
the criteria for evaluating the financial condition of the Borrowers and their
Subsidiaries shall be the same as if such change had not been
made. No delay by the Borrowers or the Required Lenders in requiring
such negotiation shall limit their right to so require such a negotiation at
any
time after such a change in accounting principles. Until any such
covenant, standard, or term is amended in accordance with this Section 5.3,
financial covenants shall be computed and determined in accordance with GAAP
in
effect prior to such change in accounting principles. Without
limiting the generality of the foregoing, theBorrowers shall
neither be deemed to be in compliance with any financial covenant hereunder
nor
out of compliance with any financial covenant hereunder if such state of
compliance or noncompliance, as the case may be, would not exist but for the
occurrence of a change in accounting principles after the date
hereof.
37
To
induce
the Lenders to enter into this Agreement and to make the extensions of credit
contemplated hereby, each of the Credit Parties represents and warrants to
the
Administrative Agent and the Lenders as follows:
Section 6.1. Organization
and Qualification. Each Credit Party is duly organized,
validly existing and in good standing under the laws of the jurisdiction of
its
organization, has full and adequate power to own its Property and conduct its
business as now conducted, and is duly licensed or qualified and in good
standing in each jurisdiction in which the nature of the business conducted
by
it or the nature of the Property owned or leased by it requires such licensing
or qualifying, except where the failure to do so would not have a Material
Adverse Effect.
Section 6.2. Subsidiaries. The
Company holds 100% of the issued and outstanding stock of each of the other
Borrowers. Each Subsidiary of the Borrowers is duly organized,
validly existing and in good standing under the laws of the jurisdiction in
which it is organized has full and adequate power to own its Property and
conduct its business as now conducted, and is duly licensed or qualified and
in
good standing in each jurisdiction in which the nature of the business conducted
by it or the nature of the Property owned or leased by it requires such
licensing or qualifying, except where the failure to do so would not have a
Material Adverse Effect. Schedule 6.2 hereto identifies each
Subsidiary, the jurisdiction of its incorporation or organization, as the case
may be, the percentage of issued and outstanding shares of each class of its
capital stock or other equity interests owned by any Borrower and the other
Subsidiaries and, if such percentage is not 100% (excluding directors’
qualifying shares as required by law), a description of each class of its
authorized capital stock and other equity interests and the number of shares
of
each class issued and outstanding. All of the outstanding shares of
capital stock and other equity interests of each Subsidiary are validly issued
and outstanding and fully paid and nonassessable and all such shares and other
equity interests indicated on Schedule 6.2 as owned by a Borrower or
another Subsidiary are owned, beneficially and of record, by such Borrower
or
such Subsidiary, as the case may be, free and clear of all Liens other than
the
Liens granted in favor of the Administrative Agent pursuant to the Collateral
Documents. There are no outstanding commitments or other obligations
of any Subsidiary to issue, and no options, warrants or other rights of any
Person to acquire, any shares of any class of capital stock or other equity
interests of any Subsidiary.
38
Section 6.3. Authority
and Validity of Obligations. Each Borrower has full right and
authority to enter into this Agreement and the other Loan Documents executed
by
it, to make the borrowings herein provided for, to issue its Notes in evidence
thereof, to grant to the Administrative Agent the Liens described in the
Collateral Documents executed by it, and to perform all of its obligations
hereunder and under the other Loan Documents executed by it. Each
Guarantor has full right and authority to enter into the Loan Documents executed
by it, to guarantee the Obligations, Hedging Liability, and Funds Transfer
and
Deposit Account Liability, to grant to the Administrative Agent the Liens
described in the Collateral Documents executed by it, and to perform all of
its
obligations under the Loan Documents executed by it. The Loan
Documents delivered by each Credit Party have been duly authorized, executed,
and delivered by such Credit Party and constitute valid and binding obligations
of such Credit Party enforceable against it in accordance with their terms,
except as enforceability may be limited by bankruptcy, insolvency, fraudulent
conveyance or similar laws affecting creditors’ rights generally and general
principles of equity (regardless of whether the application of such principles
is considered in a proceeding in equity or at law); and this Agreement and
the
other Loan Documents do not, nor does the performance or observance by any
Credit Party of any of the matters and things herein or therein provided for,
(a) contravene or constitute a default under any provision of law or any
judgment, injunction, order or decree binding upon any Credit Party or any
provision of the organizational documents (e.g., charter, certificate or
articles of incorporation and by-laws, certificate or articles of association
and operating agreement, partnership agreement or other organizational document)
of any Credit Party, (b) contravene or constitute a default under any covenant,
indenture or agreement of or affecting any Credit Party or any of its Property,
in each case where such contravention or default, individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect or (c) result in the creation or imposition of any Lien on any
Property of any Credit Party other than the Liens granted in favor of the
Administrative Agent pursuant to the Collateral Documents.
Section 6.4. Use
of
Proceeds; Margin Stock. The Borrowers shall use the proceeds
of the Term Loans and the Revolving Credit to refinance existing indebtedness
and to fund a portion of the fees and expenses incurred or otherwise required
to
be paid in connection with the consummation of the transactions contemplated
by
this Agreement; and the Borrowers shall use the proceeds of the Revolving Credit
to finance Permitted Acquisitions, to finance Capital Expenditures, to finance
Restricted Payments permitted by Section 8.12 hereof (other than Restricted
Payments permitted by Section 8.12(iii)), for its general working capital
purposes, and for such other legal and proper purposes as are consistent with
all applicable laws. None of the Borrowers or Subsidiaries are
engaged in the business of extending credit for the purpose of purchasing or
carrying margin stock (within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System), and no part of the proceeds of any
Loan or any other extension of credit made hereunder will be used to purchase
or
carry any such margin stock or to extend credit to others for the purpose of
purchasing or carrying any such margin stock. Margin stock (as
hereinabove defined) constitutes less than 25% of the assets of each Borrower
and its Subsidiaries which are subject to any limitation on sale, pledge or
other restriction hereunder.
Section 6.5. Financial
Reports. The consolidated balance sheet of the Company
and its Subsidiaries as at December 31, 2007, and the related consolidated
statements of income, retained earnings and cash flows of the Company and its
Subsidiaries for the fiscal year then ended, and accompanying notes thereto,
which financial statements are accompanied by the audit report of KPMG LLP,
independent public accountants, and the unaudited interim consolidated balance
sheet of the Company and its Subsidiaries as at September 30, 2008, and the
related consolidated statements of income, retained earnings and cash flows
of
the Company and its Subsidiaries for the three months then ended, heretofore
furnished to the Administrative Agent and the Lenders, fairly present the
consolidated financial condition of the Company and its Subsidiaries as at
said
dates and the consolidated results of their operations and cash flows
forthe periods then ended in conformity with GAAP applied
on
a consistent basis. None of the Borrowers or Subsidiaries have
contingent liabilities which are material to it other than as indicated on
such
financial statements or, with respect to future periods, on the financial
statements furnished pursuant to Section 8.5 hereof.
39
Section 6.6. No
Material Adverse Change. Since December 31, 2007, there has
been no change in the condition (financial or otherwise) of the Company or
any
Subsidiary except those occurring in the ordinary course of business, none
of
which individually or in the aggregate have had a Material Adverse
Effect.
Section 6.7. Full
Disclosure. The statements and information furnished to the
Administrative Agent and the Lenders in connection with the negotiation of
this
Agreement and the other Loan Documents and the commitments by the Lenders to
provide all or part of the financing contemplated hereby do not contain any
untrue statements of a material fact or omit a material fact necessary to make
the material statements contained herein or therein not misleading, the
Administrative Agent and the Lenders acknowledging that as to any projections
furnished to the Administrative Agent and the Lenders, the Credit Parties only
represent that the same were prepared on the basis of information and estimates
the Credit Parties believed to be reasonable.
Section 6.8. Trademarks,
Franchises, and Licenses. Each Credit Party and its
Subsidiaries own, possess, or have the right to use all necessary patents,
licenses, franchises, trademarks, trade names, trade styles, copyrights, trade
secrets, know how, and confidential commercial and proprietary information
to
conduct their businesses as now conducted, without known conflict with any
patent, license, franchise, trademark, trade name, trade style, copyright or
other proprietary right of any other Person.
Section 6.9. Governmental
Authority and Licensing. Each Credit Party and its
Subsidiaries have received all licenses, permits, and approvals of all federal,
state, and local governmental authorities, if any, necessary to conduct their
businesses, in each case where the failure to obtain or maintain the same could
reasonably be expected to have a Material Adverse Effect. No
investigation or proceeding which, if adversely determined, could reasonably
be
expected to result in revocation or denial of any material license, permit
or
approval is pending or, to the knowledge of any Credit Party,
threatened.
Section 6.10. Good
Title. Each Credit Party and its Subsidiaries have good and
defensible title (or valid leasehold interests) to their assets as reflected
on
the most recent consolidated balance sheet furnished to the Administrative
Agent
and the Lenders (except for sales of assets in the ordinary course of business),
subject to no Liens other than such thereof as are permitted by
Section 8.8 hereof.
Section 6.11. Litigation
and Other Controversies. There is no litigation or arbitration
or governmental proceeding or labor controversy pending, nor to the knowledge
of
any Credit Party threatened, against any Credit Party or any Subsidiary which
if
adversely determined, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
40
Section 6.12. Taxes. All
tax returns required to be filed by any Credit Party (to the best of such Credit
Party’s knowledge with respect to any local tax returns) or any Subsidiary in
any jurisdiction have, in fact, been filed, and all taxes, assessments, fees,
and other governmental charges upon any Credit Party or any Subsidiary or upon
any of its Property, income or franchises, which are shown to be due and payable
in such returns, have been paid, except such taxes, assessments, fees and
governmental charges, if any, as are being contested in good faith and by
appropriate proceedings which prevent enforcement of the matter under contest
and as to which adequate reserves established in accordance with GAAP have
been
provided. No Credit Party knows of any proposed additional tax
assessment against it or its Subsidiaries for which adequate provisions in
accordance with GAAP have not been made on their accounts. Adequate
provisions in accordance with GAAP for taxes on the books of each Credit Party
and its Subsidiaries have been made for all open years, and for each such
Person’s current fiscal period.
Section 6.13. Approvals. No
authorization, consent, license or exemption from, or filing or registration
with, any court or governmental department, agency or instrumentality, nor
any
approval or consent of any other Person, is or will be necessary to the valid
execution, delivery or performance by any Credit Party of any Loan Document,
except for such approvals which have been obtained prior to the date of this
Agreement and remain in full force and effect and except where failure to obtain
such authorization, consent, license, exemption, registration or approval would
not have a Material Adverse Effect.
Section 6.14. Affiliate
Transactions. Neither any Credit Party nor any Subsidiary is a
party to any contracts or agreements with any of its Affiliates (other than
with
Wholly-owned Subsidiaries) on terms and conditions
which are less favorable to such Credit Party or such Subsidiary than would
be
usual and customary in similar contracts or agreements between Persons not
affiliated with each other.
Section 6.15. Investment
Company. Neither any Credit Party nor any Subsidiary is an
“investment company” or a company “controlled” by an “investment company” within
the meaning of the Investment Company Act of 1940, as amended.
Section 6.16. ERISA. Each
Credit Party and each other member of its Controlled Group has fulfilled its
obligations under the minimum funding standards of and is in compliance in
all
material respects with ERISA and the Code to the extent applicable to it and
has
not incurred any liability to the PBGC or a Plan under Title IV of ERISA
other than a liability to the PBGC for premiums under Section 4007 of
ERISA. Neither any Credit Party nor any Subsidiary has any contingent
liabilities with respect to any post-retirement benefits under a Welfare Plan,
other than liability for continuation coverage described in article 6 of
Title I of ERISA.
Section 6.17. Compliance
with Laws. The Credit Parties and their Subsidiaries are in
compliance with the requirements of all federal, state and local laws, rules
and
regulations applicable to or pertaining to their Property or business operations
(including, without limitation, the Occupational Safety and Health Act of 1970,
the Americans with Disabilities Act of 1990, and Environmental Laws), where
any
such non-compliance, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect. Neither any Credit Party
nor any Subsidiary has received notice to the effect that its operations are
not
in compliance with any of the requirements of applicable federal, state or
local
environmental, health, and safety statutesand regulations or
is the subject of any governmental investigation evaluating whether any remedial
action is needed to respond to a release of any toxic or hazardous waste or
substance into the environment, where any such non-compliance or remedial
action, individually or in the aggregate, could reasonably be expected to have
a
Material Adverse Effect.
41
Section 6.18. Other
Agreements. Neither any Credit Party nor any Subsidiary is in
default under the terms of any covenant, indenture or agreement of or affecting
such Person or any of its Property, which default if uncured could reasonably
be
expected to have a Material Adverse Effect.
Section
6.19. Solvency. Each Credit Party and its
Subsidiaries are solvent, able to pay their debts as they become due, and have
sufficient capital to carry on their business and all businesses in which they
are about to engage.
Section 6.20.
No
Default. No Default or Event of Default has occurred and is
continuing.
Section 6.21. No
Broker Fees. No broker’s or finder’s fee or commission will be
payable by the Credit Parties with respect hereto or any of the transactions
contemplated hereby; and the Credit Parties hereby agree to indemnify the
Administrative Agent and the Lenders against, and agree that they will hold
the
Administrative Agent and the 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
attorneys’ fees) arising in connection with any such claim, demand, or
liability.
Section 7.1. All
Credit Events. At the time of each Credit Event
hereunder:
(a) each
of the representations and warranties set forth herein shall be and remain
true
and correct as of said time, except to the extent the same expressly relate
to
an earlier date;
(b) each
Credit Party and each Subsidiary shall be in compliance with all of the terms
and conditions hereof and of the other Loan Documents, and no Default or Event
of Default shall have occurred and be continuing or would occur as a result
of
such Credit Event;
(c) in
the case of a Borrowing, the Administrative Agent shall have received the notice
required by Section 1.5 hereof, in the case of the issuance of any Letter
of Credit the L/C Issuer shall have received a duly completed Application
for such Letter of Credit together with any fees called for by Section 2.1
hereof, and, in the case of an extension or increase in the amount of a Letter
of Credit, a written request therefor in a form acceptable to the
L/C Issuer together with fees called for by Section 2.1 hereof;
and
(d) such
Credit Event shall not violate any order, judgment or decree of any court or
other authority or any provision of law or regulation applicable to
theAdministrative Agent or any Lender (including, without
limitation, Regulation U of the Board of Governors of the Federal Reserve
System) as then in effect.
42
Each
request for a Borrowing hereunder and each request for the issuance of, increase
in the amount of, or extension of the expiration date of, a Letter of Credit
shall be deemed to be a representation and warranty by the Borrowers on the
date
of such Credit Event as to the facts specified in subsections (a) through
(c), both inclusive, of this Section; provided, however, that the
Lenders may continue to make advances under the Revolving Credit, in the sole
discretion of the Lenders with Revolving Credit Commitments, notwithstanding
the
failure of any Borrower to satisfy one or more of the conditions set forth
above
and any such advances so made shall not be deemed a waiver of any Default or
Event of Default or other condition set forth above that may then
exist.
Section
7.2. Initial
Credit Event. Before or concurrently with the initial Credit
Event:
(a) the
Administrative Agent shall have received for each Lender this Agreement duly
executed by the Borrowers, the Guarantors party hereto and the
Lenders;
(b) if
requested by any Lender, the Administrative Agent shall have received for such
Lender such Lender’s duly executed Notes of the Borrowers dated the date hereof
and otherwise in compliance with the provisions of Section 1.11
hereof;
(c) the
Administrative Agent shall have received the Security Agreement duly executed
by
each Credit Party party thereto, together with (i) original stock
certificates or other similar instruments or securities representing the issued
and outstanding shares of capital stock or other equity interests in each
Subsidiary to the extent required by Section 4.1 hereof, (ii) stock
powers for the Collateral consisting of the stock or other equity interest
in
each Subsidiary executed in blank and undated, (iii) UCC financing
statements to be filed against the Company and each Subsidiary, as debtor,
in
favor of the Administrative Agent, as secured party, (iv) patent,
trademark, and copyright collateral assignments to the extent requested by
the
Administrative Agent, (v) deposit account, securities account, and
commodity account control agreements to the extent requested by the
Administrative Agent and (vi) landlord’s and warehouseman’s lien waivers to
the extent required by the Security Agreement;
(d) the
Administrative Agent shall have received evidence of insurance required to
be
maintained under the Loan Documents, naming the Administrative Agent as lender’s
loss payee;
(e) the
Administrative Agent shall have received copies of each Credit Party’s articles
of incorporation and bylaws (or comparable organizational documents) and any
amendments thereto, certified in each instance by its Secretary or Assistant
Secretary (or officer or manager holding a comparable office);
(f) the
Administrative Agent shall have received copies of resolutions of each Credit
Party’s Board of Directors (or similar governing body) authorizing the
execution,delivery and performance of this Agreement and the
other Loan Documents to which it is a party and the consummation of the
transactions contemplated hereby and thereby, together with specimen signatures
of the persons authorized to execute such documents on such Credit Party’s
behalf, all certified in each instance by its Secretary or Assistant Secretary
(or officer or manager holding a comparable office);
43
(g) the
Administrative Agent shall have received copies of the certificates of good
standing for each Credit Party (dated no earlier than 30 days prior to the
date
hereof) from the office of the secretary of the state of its incorporation
or
organization and of each state in which it is qualified to do business as a
foreign corporation or organization;
(h) the
Administrative Agent shall have received a list of the Borrowers’ Authorized
Representatives;
(i) there
shall be no injunction, temporary restraining order or other legal action in
effect which would prohibit the consummation of the transaction contemplated
under this Agreement and the initial Credit Event;
(j) the
Administrative Agent shall have received a certificate regarding the solvency
of
the Company and its Subsidiaries, after giving effect to the initial Credit
Event, executed by the chief financial officer of the Company;
(k) the
Administrative Agent shall have received for itself and for the Lenders the
initial fees called for by Section 2.1 hereof;
(l) the
Administrative Agent shall have a confirmation that (i) the Company’s
Adjusted EBITDA for the twelve-month period ended September 30, 2008 was at
least $64,000,000 and (ii) the Leverage Ratio is not greater than 2.2 to
1.0, for the period ended September 30, 2008, each calculated based on
pro forma consolidated
Adjusted EBITDA for the twelve-month period ended September 30, 2008, and
after giving effect to the initial Credit Event;
(m) no
material adverse change in the business, condition (financial or otherwise),
operations, performance, Properties or prospects of any Borrower or Subsidiary
from that reflected in the financial statements as December 31, 2007 shall
have
occurred;
(n) each
Lender shall have received such evaluations and certifications as it may
reasonably require in order to satisfy itself as to the financial condition
of
the Borrowers and their Subsidiaries, and the lack of material contingent
liabilities of the Borrowers and their Subsidiaries;
(o) the
Administrative Agent shall have received financing statement, tax, and judgment
lien search results against the Property of the Company, LCBI and each Guarantor
evidencing the absence of Liens on its Property except as permitted by
Section 8.8 hereof;
44
(p) the
Administrative Agent shall have received pay-off and lien release letters from
secured creditors of each Credit Party setting forth, among other things, the
total amount of indebtedness outstanding and owing to them (or outstanding
letters of credit issued for their account) and containing an undertaking to
cause to be delivered to the Administrative Agent (or authorizing the
Administrative Agent to file) UCC termination statements and any other lien
release instruments necessary to release such secured creditor’s Liens on the
assets of each Credit Party, which pay-off and lien release letters shall be
in
form and substance acceptable to the Administrative Agent;
(q) the
Administrative Agent shall have received for each Lender the favorable written
opinion of counsel to each of the Credit Parties, in form and substance
satisfactory to the Administrative Agent;
(r) the
Administrative Agent shall have received an Internal Revenue Service Form W-9,
or Form W-8, as applicable, duly executed by each Credit Party in form
and substance acceptable to the Administrative Agent;
(s) after
giving effect to the initial Credit Event hereunder, the aggregate amount of
Loans and L/C Obligations outstanding shall not exceed
$130,000,000;
(t) the
Administrative Agent shall have received certificates of merger evidencing
the
merger of (i) The First Years, Inc., a Delaware corporation with and into The
First Years, Inc., a Massachusetts corporation (“TFY(MA)”) with TFY(MA) as
the surviving corporation and (ii) TFY(MA) with and into LCBI with LCBI being
the surviving corporation; and
(u) the
Administrative Agent shall have received for the account of the Lenders such
other agreements, instruments, documents, certificates, and opinions as the
Administrative Agent may reasonably request.
The
Credit Parties agree that, so long as any credit is available to or in use
by
the Borrowers, or any of them, hereunder, except to the extent compliance in
any
case or cases is waived in writing pursuant to the terms of Section 13.13
hereof:
Section 8.1. Maintenance
of Business. (a) Each Credit Party shall, and
shall cause each Subsidiary to, preserve and maintain its existence, except
as
otherwise provided in Section 8.10(c) hereof.
(b) Each
Credit Party shall, and shall cause each Subsidiary to, preserve and keep in
force and effect all licenses, permits, franchises, approvals, patents,
trademarks, trade names, trade styles, copyrights, and other proprietary rights
necessary to the proper conduct of itsbusiness where the
failure to do so could reasonably be expected to have a Material Adverse
Effect.
45
Section 8.2. Maintenance
of Properties. Each Credit Party shall, and shall cause each
Subsidiary to, maintain, preserve, and keep its Property, plant, and equipment
used or useful in its business in good repair, working order and condition
(ordinary wear and tear excepted), and shall from time to time make all needful
and proper repairs, renewals, replacements, additions, and betterments thereto
so that at all times the efficiency thereof shall be fully preserved and
maintained.
Section 8.3. Taxes
and Assessments. Each Credit Party shall duly pay and
discharge, and shall cause each Subsidiary to duly pay and discharge, all taxes,
rates, assessments, fees, and governmental charges upon or against it or its
Property, in each case before the same become delinquent and before penalties
accrue thereon, unless and to the extent that the same are being contested
in
good faith and by appropriate proceedings which prevent enforcement of the
matter under contest and adequate reserves are provided therefor and except
to
the extent that failure to so pay or discharge would not have a Material Adverse
Effect.
Section 8.4. Insurance. Each
Credit Party shall insure and keep insured, and shall cause each Subsidiary
to
insure and keep insured, with good and responsible insurance companies, all
insurable Property owned by it which is of a character usually insured by
Persons similarly situated and operating like Properties against loss or damage
from such hazards and risks, and in such amounts, as are insured by Persons
similarly situated and operating like Properties; and each Credit Party shall
insure, and shall cause each Subsidiary to insure, such other hazards and risks
(including, without limitation, employers’ and public liability risks) with good
and responsible insurance companies as and to the extent usually insured by
Persons similarly situated and conducting similar businesses. The Credit Parties
shall in any event maintain, and cause each Subsidiary to maintain, insurance
on
the Collateral to the extent required by the Collateral
Documents. Each Credit Party shall, upon the request of the
Administrative Agent, furnish to the Administrative Agent and the Lenders a
certificate setting forth in summary form the nature and extent of the insurance
maintained pursuant to this Section.
Section 8.5. Financial
Reports. The Company shall, and shall cause each Subsidiary
to, maintain a standard system of accounting in accordance with
GAAP. The Company and each Borrower shall furnish to the
Administrative Agent, each Lender and each of their duly authorized
representatives such information respecting the business and financial condition
of the Borrowers and their respective Subsidiaries as the Administrative Agent
or such Lender may reasonably request; and without any request, the Company
and
the Borrowers shall furnish to the Administrative Agent and the
Lenders:
(a) as
soon as available, and in any event within 45 days after the close of each
fiscal quarter of each fiscal year of the Company (or such shorter period as
may
be required by the SEC for filing quarterly reports with the SEC), a copy of
the
consolidated and consolidating balance sheet of the Company and its Subsidiaries
as of the last day of such fiscal quarter and the consolidated and consolidating
statements of income, retained earnings, and cash flows of the Company and
its
Subsidiaries for the fiscal quarter and for the fiscal year-to-date period
then
ended, each in reasonable detail showing incomparative form
the figures for the corresponding date and period in the previous fiscal year,
prepared by the Company in accordance with GAAP (subject to the absence of
footnote disclosures and year-end audit adjustments) and certified to by its
chief financial officer or another officer of the Company acceptable to the
Administrative Agent;
46
(b) as
soon as available, and in any event within 90 days after the close of each
fiscal year of the Company (or such shorter period as may be required by the
SEC
for filing annual reports with the SEC), a copy of the consolidated and
consolidating balance sheet of the Company and its Subsidiaries as of the last
day of the fiscal year then ended and the consolidated and consolidating
statements of income, retained earnings, and cash flows of the Company and
its
Subsidiaries for the fiscal year then ended, and accompanying notes thereto,
each in reasonable detail showing in comparative form the figures for the
previous fiscal year, accompanied by an unqualified opinion of a firm of
independent public accountants of recognized national standing, selected by
the
Company and reasonably satisfactory to the Administrative Agent and the Required
Lenders, to the effect that the consolidated financial statements have been
prepared in accordance with GAAP and present fairly in accordance with GAAP
the
consolidated financial condition of the Company and its Subsidiaries as of
the
close of such fiscal year and the results of their operations and cash flows
for
the fiscal year then ended and that an examination of such accounts in
connection with such financial statements has been made in accordance with
generally accepted auditing standards and, accordingly, such examination
included such tests of the accounting records and such other auditing procedures
as were considered necessary in the circumstances;
(c) within
the period provided in subsection (b) above, the written statement of the
accountants who certified the audit report thereby required that in the course
of their audit they have obtained no knowledge of any Default or Event of
Default, or, if such accountants have obtained knowledge of any such Default
or
Event of Default, they shall disclose in such statement the nature and period
of
the existence thereof;
(d) promptly
after receipt thereof, any additional written reports, management letters or
other detailed information contained in writing concerning significant aspects
of the Company’s or any Subsidiary’s operations and financial affairs given to
it by its independent public accountants;
(e) promptly
after the sending or filing thereof, copies of each financial statement, report,
notice or proxy statement sent by the Company or any Subsidiary to its
stockholders or other equity holders, and copies of each regular, periodic
or
special report, registration statement or prospectus (including all Form 10-K,
Form 10-Q and Form 8-K reports) filed by the Company or any Subsidiary with
any
securities exchange or the SEC;
(f) promptly
after receipt thereof, a copy of each audit made by any regulatory agency of
the
books and records of the Company or any Subsidiary or of notice of any material
noncompliance with any applicable law, regulation or guideline relating to
the
Company or any Subsidiary, or its business;
47
(g) as
soon as available, and in any event within 60 days after the end of each fiscal
year of the Company, a copy of the Company’s consolidated and consolidating
operating budget for the following fiscal year, in reasonable detail prepared
by
the Company and in form satisfactory to the Administrative Agent (which shall
include a summary of all assumptions made in preparing such operating
budget);
(h) notice
of any Change in Control;
(i) promptly
after knowledge thereof shall have come to the attention of any responsible
officer of any Credit Party, written notice of (i) any threatened or pending
litigation or governmental proceeding or labor controversy against the Company
or any Subsidiary which, if adversely determined, could reasonably be expected
to have a Material Adverse Effect, (ii) of the occurrence of any Default or
Event of Default hereunder, or (iii) upon the occurrence of or any condition
exists that could reasonably be expected to have a Material Adverse Effect;
and
(j) with
each of the financial statements furnished to the Lenders pursuant to
subsections (a) and (b) above, a written certificate in the form attached
hereto as Exhibit E signed by the chief financial officer of the Company or
another officer of the Company acceptable to the Administrative Agent to the
effect that to the best of such officer’s knowledge and belief no Default or
Event of Default has occurred during the period covered by such statements
or,
if any such Default or Event of Default has occurred during such period, setting
forth a description of such Default or Event of Default and specifying the
action, if any, taken by the Credit Parties or any Subsidiary to remedy the
same. Such certificate shall also set forth the calculations in
respect of Section 8.9(h) hereof and supporting such statements in respect
of
Section 8.21 hereof.
Section 8.6. Inspection. The
Credit Parties shall, and shall cause each Subsidiary to, permit the
Administrative Agent, each Lender, the L/C Issuer and each of their duly
authorized representatives and agents to visit and inspect any of its Property,
corporate books, and financial records, to examine and make copies of its books
of accounts and other financial records, and to discuss its affairs, finances,
and accounts with, and to be advised as to the same by, its officers, employees
and independent public accountants (and by this provision each Credit Party
hereby authorizes such accountants to discuss with the Administrative Agent,
such Lenders and the L/C Issuer the finances and affairs of such Credit Party
and its Subsidiaries) at such reasonable times and intervals as the
Administrative Agent or any such Lender or the L/C Issuer may designate and,
so
long as no Default or Event of Default exists, with reasonable prior notice
to
the Borrowers.
Section 8.7. Borrowings
and Guaranties. The Credit Parties shall not, nor shall they permit any
Subsidiary to, issue, incur, assume, create or have outstanding any Indebtedness
for Borrowed Money, or be or become liable as endorser, guarantor, surety or
otherwise for any debt, obligation or undertaking of any other Person, or
otherwise agree to provide funds for payment of the obligations of another,
or
supply funds thereto or invest therein or otherwise assure a creditor of another
against loss, or apply for or become liable to the issuer of a letter of credit
which supports an obligation of another, or subordinate any claim or demand
it
may haveto the claim or demand of any other Person; provided,
however, that the
foregoing shall not restrict nor operate to prevent:
48
(a) the
Obligations, Hedging Liability, and Funds Transfer and Deposit Account Liability
of the Borrowers and their Subsidiaries owing to the Administrative Agent and
the Lenders (and their Affiliates in the case of Hedging
Liability);
(b) The
Guaranties;
(c) purchase
money indebtedness and Capitalized Lease Obligations of the Borrower and its
Subsidiaries in an amount not to exceed $500,000 in the aggregate at any one
time outstanding;
(d) endorsement
of items for deposit or collection of commercial paper received in the ordinary
course of business;
(e) unsecured
intercompany indebtedness among the Company and its Domestic Subsidiaries,
provided that any such
indebtedness shall be fully subordinated to the Obligations on terms reasonably
satisfactory to the Administrative Agent;
(f) unsecured
intercompany indebtedness among the Company, the Domestic Subsidiaries and
the
Foreign Subsidiaries, provided that any such
indebtedness (i) shall be fully subordinated to the Obligations on terms
reasonably satisfactory to the Administrative Agent and (ii) is permitted by
Section 8.9(h) hereof;
(g) the
Company’s guarantee of the obligations of LCBI with respect to its licensing
arrangements with Disney Enterprises, Inc.; and
(h) a
guaranty by a Credit Party of indebtedness of another Credit Party permitted
by
this Section 8.7; and
(i) Indebtedness
for Borrowed Money and other contingent obligations other than those which
are
permitted by the foregoing subsections (a) through (f) provided such Indebtedness
and other contingent obligations do not exceed $10,000,000 at any time
outstanding for the Company and its Subsidiaries in the aggregate.
Section 8.8. Liens. The
Credit Parties shall not, nor shall they permit any Subsidiary to, create,
incur
or permit to exist any Lien of any kind on any Property owned by any such
Person; provided,
however, that the foregoing shall not apply to nor operate to
prevent:
(a) Liens
arising by statute in connection with worker’s compensation, unemployment
insurance, old age benefits, social security obligations, taxes, assessments,
statutory obligations or other similar charges (other than Liens arising under
ERISA), good faith cash deposits in connection with tenders, contracts or leases
to which any Credit Party or any Subsidiary is a party or other cash deposits
required to be made in the ordinary course of business, provided in each case
that the obligation is not for borrowed money and that the obligation secured
is
not overdue or, if overdue, isbeing contested in good faith
by appropriate proceedings which prevent enforcement of the matter under contest
and adequate reserves have been established therefor;
49
(b) mechanics’,
workmen’s, materialmen’s, landlords’, carriers’ or other similar Liens arising
in the ordinary course of business with respect to obligations which are not
due
or which are being contested in good faith by appropriate proceedings which
prevent enforcement of the matter under contest;
(c) judgment
liens and judicial attachment liens not constituting an Event of Default under
Section 9.1(g) hereof and the pledge of assets for the purpose of securing
an appeal, stay or discharge in the course of any legal proceeding, provided
that the aggregate amount of such judgment liens and attachments and liabilities
of the Credit Parties and their Subsidiaries secured by a pledge of assets
permitted under this subsection, including interest and penalties thereon,
if
any, shall not be in excess of $1,000,000 at any one time
outstanding;
(d) Liens
on Property of any Credit Party or any Subsidiary created solely for the purpose
of securing indebtedness permitted by Section 8.7(c) hereof, representing
or incurred to finance the purchase price of Property, provided that no such Lien
shall extend to or cover other Property of such Credit Party or such Subsidiary
other than the respective Property so acquired, and the principal amount of
indebtedness secured by any such Lien shall at no time exceed the purchase
price
of such Property, as reduced by repayments of principal thereon;
(e) any
interest or title of a lessor under any operating lease;
(f) easements,
rights-of-way, restrictions, and other similar encumbrances against real
property incurred in the ordinary course of business which, in the aggregate,
are not substantial in amount and which do not materially detract from the
value
of the Property subject thereto or materially interfere with the ordinary
conduct of the business of the Borrower or any Subsidiary; and
(g) the
Liens granted in favor of the Administrative Agent pursuant to the Collateral
Documents; and
(h) Liens
other than those permitted by any of the foregoing subsections (a) through
(g) provided such Liens
do not extend to any Collateral and provided further that such
Liens secure obligations not exceeding $10,000,000 in the aggregate for the
Company and its Subsidiaries.
Section 8.9. Investments,
Acquisitions, Loans and Advances. The Credit Parties shall
not, nor shall they permit any Subsidiary to, directly or indirectly, make,
retain or have outstanding any investments (whether through purchase of stock
or
obligations or otherwise) in, or loans or advances to, any other Person, or
acquire all or any substantial part of the assets or business of any other
Person or division thereof; provided, however, that the
foregoing shall not apply to nor operate to prevent:
50
(a) investments
in direct obligations of the United States of America or of any agency or
instrumentality thereof whose obligations constitute full faith and credit
obligations of the United States of America, provided that any such obligations
shall mature within one year of the date of issuance thereof;
(b) investments
in commercial paper rated at least P-1 by Xxxxx’x and at least A-1 by S&P
maturing within one year of the date of issuance thereof;
(c) investments
in certificates of deposit issued by any Lender or by any United States
commercial bank having capital and surplus of not less than $100,000,000 which
have a maturity of one year or less;
(d) investments
in repurchase obligations with a term of not more than seven days for underlying
securities of the types described in subsection (a) above entered into with
any bank meeting the qualifications specified in subsection (c) above,
provided all such agreements require physical delivery of the securities
securing such repurchase agreement, except those delivered through the Federal
Reserve Book Entry System;
(e) investments
in money market funds that invest solely, and which are restricted by their
respective charters to invest solely, in investments of the type described
in
the immediately preceding subsections (a), (b), (c), and (d)
above;
(f) the
Company’s investments from time to time in its Domestic Subsidiaries, and
investments made from time to time by any such Domestic Subsidiary in one or
more of its Domestic Subsidiaries;
(g) intercompany
advances made from time to time from the Company or any Domestic Subsidiary
to
any one or more Domestic Subsidiaries in the ordinary course of business to
finance working capital needs;
(h) intercompany
advances and loans made from time to time by the Company and its Domestic
Subsidiaries to any one or more Foreign Subsidiaries (net of intercompany
advances and loans made from time to time by any one or more Foreign
Subsidiaries to the Company and its Domestic Subsidiaries) in an aggregate
net
amount not to exceed $53,000,000 as of the last day of each fiscal quarter
of
the Company (it being acknowledged that the net amount of such advances and
loans was $42,737,304 as of September 30, 2008), as such limitation shall be
reduced dollar-for-dollar by the amount of any investment made after the Closing
Date by the Company or any Domestic Subsidiary in the common stock or
paid-in-capital of any Foreign Subsidiary;
(i) investments
made from time to time by any Foreign Subsidiary in one or more of its Foreign
Subsidiaries;
(j) intercompany
advances and loans made from time to time from any Foreign Subsidiary to any
one
or more Foreign Subsidiaries in the ordinary course of business to finance
working capital needs;
(k) Permitted
Acquisitions; and
51
(l) other
investments, loans, and advances in addition to those otherwise permitted by
this Section provided
that such investments, loans and advances do not exceed $7,500,000 individually
or $15,000,000 in the aggregate at any one time outstanding.
In
determining the amount of investments, acquisitions, loans, and advances
permitted under this Section, investments and acquisitions shall always be
taken
at the original cost thereof (regardless of any subsequent appreciation or
depreciation therein), and loans and advances shall be taken at the principal
amount thereof then remaining unpaid.
Section 8.10.
Mergers, Consolidations
and Sales. The Credit Parties shall not, nor shall they permit
any Subsidiary to, be a party to any merger or consolidation, or sell, transfer,
lease or otherwise dispose of all or any part of its Property, including any
disposition of Property as part of a sale and leaseback transaction, or in
any
event sell or discount (with or without recourse) any of its notes or accounts
receivable; provided,
however, that this Section shall not apply to nor operate to
prevent:
(a) the
sale or lease of inventory in the ordinary course of business;
(b) the
sale, transfer, lease or other disposition of Property of any Credit Party
and
its Subsidiaries to one another in the ordinary course of its business; provided that any sale,
transfer, lease or other disposition of Property to a Foreign Subsidiary for
less than fair market value shall be deemed an investment in such Foreign
Subsidiary to the extent of such deficiency and shall utilize the basket set
forth in Section 8.9(h) hereof;
(c) the
merger of a Credit Party or any Subsidiary of a Credit Party with and into
any
Credit Party or any other Subsidiary of a Credit Party, provided that, in the case
of
any merger involving a Credit Party, such Credit Party is the corporation
surviving the merger and, in the case of any merger of a Borrower and a
Guarantor, such Borrower is the corporation surviving the merger;
(d) the
sale of delinquent notes or accounts receivable in the ordinary course of
business for purposes of collection only (and not for the purpose of any bulk
sale or securitization transaction);
(e) the
sale, transfer or other disposition of any tangible personal property that,
in
the reasonable business judgment of the relevant Credit Party or its Subsidiary,
has become obsolete or worn out, and which is disposed of in the ordinary course
of business; and
(f) the
sale, transfer, lease or other disposition of Property of any Credit Party
or
any Subsidiary (including any disposition of Property as part of a sale and
leaseback transaction) aggregating for the Credit Parties and their Subsidiaries
not more than $10,000,000 during any fiscal year of the Credit
Parties.
Section 8.11. Maintenance
of Subsidiaries. The Credit Parties shall not assign, sell or
transfer, nor shall it permit any Subsidiary to issue, assign, sell or transfer,
any shares of capital stock or other equity interests of a Subsidiary; provided, however, that the
foregoing shall notoperate to prevent (a) the issuance,
sale, and transfer to any person of any shares of capital stock of a Subsidiary
solely for the purpose of qualifying, and to the extent legally necessary to
qualify, such person as a director of such Subsidiary, and (b) any
transaction permitted by Section 8.10(c) above.
52
Section 8.12. Dividends
and Certain Other Restricted Payments. The Credit Parties
shall not, nor shall they permit any Subsidiary to, (a) declare or pay any
dividends on or make any other distributions in respect of any class or series
of its capital stock or other equity interests or (b) directly or
indirectly purchase, redeem, or otherwise acquire or retire any of its capital
stock or other equity interests or any warrants, options, or similar instruments
to acquire the same; provided,
however, that the foregoing shall not operate to prevent the following
(all of which are referred to collectively as “Restricted Payments”):
(i) the making of dividends or distributions by any Wholly-owned Subsidiary
of any Credit Party to its parent corporation, (ii) dividends payable
solely in the same class of capital stock of such Person, (iii) the making
of
regularly scheduled dividends to the Company’s shareholders, provided that (A) no Default
or Event of Default has occurred and is continuing at such time or would be
directly or indirectly caused as a result thereof and (B) such dividends shall
be paid out of Net Income, and (iv) the Company’s repurchase of shares of
its capital stock on the open market or non-scheduled, non-recurring dividends,
provided that (A)
no Default or Event of Default has occurred and is continuing at such time
or
would be directly or indirectly caused as a result thereof on an actual or
pro forma basis, (B) after
giving effect to such repurchase or dividend, the Borrowers would have a
Leverage Ratio on a pro
forma basis of at least 0.25:1.00 below the then maximum Leverage Ratio
permitted by Section 8.21(i), (C) after giving effect to such repurchase or
dividend, there shall be at least $35,000,000 in Unused Revolving Credit
Commitments and (D) the aggregate amount for such share repurchase or
non-scheduled, non-recurring dividend shall not exceed $5,000,000 for each
fiscal year of the Company and $15,000,000 during the term of the
facilities.
Section 8.13. ERISA. The
Credit Parties shall, and shall cause each Subsidiary to, promptly pay and
discharge all obligations and liabilities arising under ERISA of a character
which if unpaid or unperformed could reasonably be expected to result in the
imposition of a Lien against any of its Property. The Credit Parties
shall, and shall cause each Subsidiary to, promptly notify the Administrative
Agent and each Lender of: (a) the occurrence of any reportable
event (as defined in ERISA) with respect to a Plan, (b) receipt of any
notice from the PBGC of its intention to seek termination of any Plan or
appointment of a trustee therefor, (c) its intention to terminate or
withdraw from any Plan, and (d) the occurrence of any event with respect to
any Plan which would result in the incurrence by any Credit Party or any
Subsidiary of any material liability, fine or penalty, or any material increase
in the contingent liability of any Credit Party or any Subsidiary with respect
to any post-retirement Welfare Plan benefit.
Section 8.14. Compliance
with Laws. Each Credit Party shall, and shall cause each
Subsidiary to, comply in all respects with all Legal Requirements applicable
to
or pertaining to its Property or business operations, where any such
non-compliance, individually or in the aggregate, could reasonably be expected
to have a Material Adverse Effect or result in a Lien upon any of its
Property.
53
Section 8.15. Burdensome
Contracts With Affiliates. The Credit Parties shall not, nor shall they
permit any Subsidiary to, enter into any contract, agreement or business
arrangement with any of its Affiliates (other than with Wholly-owned
Subsidiaries) on terms and conditions which are less favorable to such Credit
Party or such Subsidiary than would be usual and customary in similar contracts,
agreements or business arrangements between Persons not affiliated with each
other.
Section 8.16. No
Changes in Fiscal Year. The fiscal year of the Company and its
Subsidiaries ends on December 31 of each year; and the Company shall not,
nor shall it permit any Subsidiary to, change its fiscal year from its present
basis.
Section 8.17. Formation
of Subsidiaries. Promptly upon the formation or acquisition of
any Subsidiary of the Company (whether direct or indirect), the Company shall
provide the Administrative Agent and the Lenders notice thereof (at which time
Schedule 6.2 shall be deemed amended to include reference to such
Subsidiary) and, in the case of the formation or acquisition of a Domestic
Subsidiary of the Company, comply with the requirements of Section 4 hereof
on a timely basis.
Section 8.18. Change
in the Nature of Business. The Credit Parties shall not, nor
shall they permit any Subsidiary to, engage in any business or activity if
as a
result the general nature of the business of such Credit Party or such
Subsidiary would be changed in any material respect from the general nature
of
the business engaged in by it as of the Closing Date.
Section 8.19. Use
of
Loan Proceeds. The Borrowers shall use the credit extended
under this Agreement solely for the purposes set forth in, or otherwise
permitted by, Section 6.4 hereof.
Section 8.20. No
Restrictions. Except as provided herein, the Credit Parties
shall not, nor shall they permit any Subsidiary to, directly or indirectly
create or otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of such Credit Party
or
such Subsidiary to: (a) pay dividends or make any other
distribution on any Subsidiary’s capital stock or other equity interests owned
by such Credit Party or such Subsidiary, (b) pay any indebtedness owed to
any Borrower or any Subsidiary, (c) make loans or advances to any Borrower
or any Subsidiary, (d) transfer any of its Property to any Borrower or any
Subsidiary or (e) guarantee the Obligations, Hedging Liability and Funds
Transfer and Deposit Account Liability, and/or grant Liens on its assets to
the
Administrative Agent as required by the Loan Documents.
Section 8.21. Financial
Covenants. (i) Leverage
Ratio. The Company shall not, as of the last day of each
fiscal quarter of the Company, permit the Leverage Ratio to be greater than
2.50
to 1.0.
(ii) Fixed
Charge Coverage
Ratio. The Company shall not, as of the last day of each
fiscal quarter of the Company, permit the Fixed Charge Coverage Ratio to be
less
than 1.25 to 1.0.
(iii) Operating
Leases. The Company shall not, nor shall it permit any
Subsidiary to, acquire the use or possession of any Property under a lease
or
similar arrangement, whether or not the Company or any Subsidiary has the
express or implied right to acquire title to or purchasesuch
Property, at any time if, after giving effect thereto, the aggregate amount
of
fixed rentals and other consideration payable by the Company and its
Subsidiaries under all such leases and similar arrangements would exceed
$10,000,000 during any fiscal year of the Company. Capital Leases
shall not be included in computing compliance with this Section to the
extent the Company’s and its Subsidiaries’ liability in respect of the same is
permitted by Section 8.7(c) hereof.
54
(iv) Clean-Down. For
a
period of 60 consecutive days occurring between January 1 and April 30
of each year, the aggregate principal amount of Revolving Loans, Swing Loans
and
L/C Obligations shall not exceed (A) $30,000,000 for the fiscal year ending
December 31, 2009, (B) $27,500,000 for the fiscal year ending December 31,
2010
and (C) $25,000,000 for the fiscal year ending December 31, 2011.
Section 8.22. Post-Closing
Covenants. (i) Deposit Account Control
Agreements. Not later than 30 days after the Closing Date
(as such date may be extended by the Administrative Agent in its sole
discretion) and subject to Section 4.1 hereof, the Company shall, and shall
cause each domestic Credit Party to, deliver to the Administrative Agent account
control agreements with respect to each deposit account of the Company and
domestic Credit Parties on terms reasonably acceptable to the Administrative
Agent.
(ii) Opinions
of
Counsel. Not later than 5 Business Days after the Closing Date
(as such date may be extended by the Administrative Agent in its sole
discretion), each Foreign Borrower shall deliver an opinion of counsel in form
and substance satisfactory to the Administrative
Agent. Notwithstanding anything else contained herein to the
contrary, the Company may not request a Borrowing on behalf of any Foreign
Borrower that has not delivered an opinion of counsel in form and substance
satisfactory to the Administrative Agent and the Lenders shall not be obligated
to advance any Borrowing to such Foreign Borrower until receipt of such
opinion.
Section 9.1. Events
of Default. Any one or more of the following shall constitute
an “Event of Default”
hereunder:
(a) default
in the payment when due of all or any part of the principal of any Loan (whether
at the stated maturity thereof or at any other time provided for in this
Agreement) or of any Reimbursement Obligation, or default for a period of
3 Business Days in the payment when due of any interest, fee or other
Obligation payable hereunder or under any other Loan Document;
(b) default
in the observance or performance of any covenant set forth in
Section 8.1(a), 8.4, 8.5, 8.7, 8.8, 8.9, 8.10, 8.11, 8.12, 8.21 or 8.22
hereof or of any provision in any Loan Document dealing with the use,
disposition or remittance of the proceeds of Collateral or requiring the
maintenance of insurance thereon;
(c) default
in the observance or performance of any other provision hereof or of any other
Loan Document which is not remedied within 30 days after the earlier of
(i) the date on which such failure shall first become known to any officer
of anyBorrower or (ii) written notice thereof is given
to the Borrowers by the Administrative Agent;
55
(d) any
representation or warranty made herein or in any other Loan Document or in
any
certificate furnished to the Administrative Agent or the Lenders pursuant hereto
or thereto or in connection with any transaction contemplated hereby or thereby
proves untrue in any material respect as of the date of the issuance or making
or deemed making thereof;
(e) any
event occurs or condition exists (other than those described in
subsections (a) through (d) above) which is specified as an event of
default under any of the other Loan Documents, or any of the Loan Documents
shall for any reason not be or shall cease to be in full force and effect or
is
declared to be null and void, or any of the Collateral Documents shall for
any
reason fail to create a valid and perfected first priority Lien in favor of
the
Administrative Agent in any Collateral purported to be covered thereby except
as
expressly permitted by the terms thereof, or any Credit Party takes any action
for the purpose of terminating, repudiating or rescinding any Loan Document
executed by it or any of its obligations thereunder;
(f) default
shall occur under any Indebtedness for Borrowed Money issued, assumed or
guaranteed by any Credit Party or any Subsidiary aggregating in excess of
$1,000,000, or under any indenture, agreement or other instrument under which
the same may be issued, and such default shall continue for a period of time
sufficient to permit the acceleration of the maturity of any such Indebtedness
for Borrowed Money (whether or not such maturity is in fact accelerated), or
any
such Indebtedness for Borrowed Money shall not be paid when due (whether by
demand, lapse of time, acceleration or otherwise);
(g) any
judgment or judgments, writ or writs or warrant or warrants of attachment,
or
any similar process or processes, shall be entered or filed against any Credit
Party or any Subsidiary, or against any of its Property, in an aggregate amount
in excess of $1,000,000 (except to the extent fully covered by insurance
pursuant to which the insurer has accepted liability therefor in writing),
and
which remains undischarged, unvacated, unbonded or unstayed for a period of
30 days;
(h) any
Credit Party or any Subsidiary, or any member of its Controlled Group, shall
fail to pay when due an amount or amounts aggregating in excess of $1,000,000
which it shall have become liable to pay to the PBGC or to a Plan under
Title IV of ERISA; or notice of intent to terminate a Plan or Plans having
aggregate Unfunded Vested Liabilities in excess of $1,000,000 (collectively,
a
“Material Plan”) shall
be filed under Title IV of ERISA by any Credit Party or any Subsidiary, or
any other member of its Controlled Group, any plan administrator or any
combination of the foregoing; or the PBGC shall institute proceedings under
Title IV of ERISA to terminate or to cause a trustee to be appointed to
administer any Material Plan or a proceeding shall be instituted by a fiduciary
of any Material Plan against any Credit Party Borrower or any Subsidiary, or
any
member of its Controlled Group, to enforce Section 515 or 4219(c)(5) of
ERISA and such proceeding shall not have been dismissed within 30
daysthereafter; or a condition shall exist by reason of
which the PBGC would be entitled to obtain a decree adjudicating that any
Material Plan must be terminated;
56
(i) any
Change of Control shall occur;
(j) any
Credit Party or any Subsidiary shall (i) have entered involuntarily against
it an order for relief under the United States Bankruptcy Code, as amended,
(ii) not pay, or admit in writing its inability to pay, its debts generally
as they become due, (iii) make an assignment for the benefit of creditors,
(iv) apply for, seek, consent to or acquiesce in, the appointment of a
receiver, custodian, trustee, examiner, liquidator or similar official for
it or
any substantial part of its Property, (v) institute any proceeding seeking
to have entered against it an order for relief under the United States
Bankruptcy Code, as amended, to adjudicate it insolvent, or seeking dissolution,
winding up, liquidation, reorganization, arrangement, adjustment or composition
of it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fail to file an answer or other pleading
denying the material allegations of any such proceeding filed against it,
(vi) take any action in furtherance of any matter described in
parts (i) through (v) above, or (vii) fail to contest in good faith
any appointment or proceeding described in Section 9.1(k) hereof;
or
(k) a
custodian, receiver, trustee, examiner, liquidator or similar official shall
be
appointed for any Credit Party or any Subsidiary, or any substantial part of
any
of its Property, or a proceeding described in Section 9.1(j)(v) shall be
instituted against any Credit Party or any Subsidiary, and such appointment
continues undischarged or such proceeding continues undismissed or unstayed
for
a period of 60 days.
Section 9.2. Non-Bankruptcy
Defaults. When any Event of Default other than those described
in subsection (j) or (k) of Section 9.1 hereof has occurred and is
continuing, the Administrative Agent shall, by written notice to the
Borrowers: (i) if so directed by the Required Lenders, terminate
the remaining Commitments and all other obligations of the Lenders hereunder
on
the date stated in such notice (which may be the date thereof); (ii) if so
directed by the Required Lenders, declare the principal of and the accrued
interest on all outstanding Loans to be forthwith due and payable and thereupon
all outstanding Loans, including both principal and interest thereon, shall
be
and become immediately due and payable together with all other amounts payable
under the Loan Documents without further demand, presentment, protest or notice
of any kind; and (iii) if so directed by the Required Lenders, demand that
the Borrowers immediately pay to the Administrative Agent the full amount then
available for drawing under each or any Letter of Credit, and the Borrowers
agree to immediately make such payment and acknowledge and agree that the
Lenders would not have an adequate remedy at law for failure by the Borrowers
to
honor any such demand and that the Administrative Agent, for the benefit of
the
Lenders, shall have the right to require the Borrowers to specifically perform
such undertaking whether or not any drawings or other demands for payment have
been made under any Letter of Credit. The Administrative Agent, after
giving notice to the Borrowers pursuant to Section 9.1(c) or this
Section 9.2, shall also promptly send a copy of such notice to the other
Lenders, but the failure to do so shall not impair or annul the effect of such
notice.
57
Section 9.3. Bankruptcy
Defaults. When any Event of Default described in
subsections (j) or (k) of Section 9.1 hereof has occurred and is
continuing, then all outstanding Loans shall immediately become due and payable
together with all other amounts payable under the Loan Documents without
presentment, demand, protest or notice of any kind, the obligation of the
Lenders to extend further credit pursuant to any of the terms hereof shall
immediately terminate and the Borrowers shall immediately pay to the
Administrative Agent the full amount then available for drawing under all
outstanding Letters of Credit, the Borrowers acknowledging and agreeing that
the
Lenders would not have an adequate remedy at law for failure by the Borrowers
to
honor any such demand and that the Lenders, and the Administrative Agent on
their behalf, shall have the right to require the Borrowers to specifically
perform such undertaking whether or not any draws or other demands for payment
have been made under any of the Letters of Credit.
Section 9.4. Collateral
for Undrawn Letters of Credit. (a) If the prepayment of
the amount available for drawing under any or all outstanding Letters of Credit
is required under Section 1.8(b), Section 1.18, Section 9.2 or
9.3 above, the Borrowers shall forthwith pay the amount required to be so
prepaid, to be held by the Administrative Agent as provided in
subsection (b) below.
(b) All
amounts prepaid pursuant to subsection (a) above shall be held by the
Administrative Agent in one or more separate collateral accounts (each such
account, and the credit balances, properties, and any investments from time
to
time held therein, and any substitutions for such account, any certificate
of
deposit or other instrument evidencing any of the foregoing and all proceeds
of
and earnings on any of the foregoing being collectively called the “Collateral Account”) as
security for, and for application by the L/C Issuer (to the extent available)
to, the reimbursement of any payment under any Letter of Credit then or
thereafter made by the Administrative Agent, and to the payment of the unpaid
balance of all other Obligations (and to all Hedging Liability and Funds
Transfer and Deposit Account Liability). The Collateral Account shall
be held in the name of and subject to the exclusive dominion and control of
the
Administrative Agent for the benefit of the Administrative Agent, the Lenders,
and the L/C Issuer. If and when requested by the Company, on behalf
of the Borrowers, the Administrative Agent shall invest funds held in the
Collateral Account from time to time in direct obligations of, or obligations
the principal of and interest on which are unconditionally guaranteed by, the
United States of America with a remaining maturity of one year or less, provided that the
Administrative Agent is irrevocably authorized to sell investments held in
the
Collateral Account when and as required to make payments out of the Collateral
Account for application to amounts due and owing from the Borrowers to the
L/C
Issuer, the Administrative Agent or the Lenders; provided, however, that if
(i) the Borrowers shall have made payment of all such obligations referred
to in subsection (a) above, (ii) all relevant preference or other
disgorgement periods relating to the receipt of such payments have passed,
and
(iii) no Letters of Credit, Commitments, Loans or other Obligations,
Hedging Liability or Funds Transfer and Deposit Account Liability remain
outstanding hereunder, then the Administrative Agent shall release to the
Company, on behalf of the Borrowers, any remaining amounts held in the
Collateral Account.
58
Section 9.5. Notice
of Default. The Administrative Agent shall give notice to the
Borrowers under Section 9.1(c) hereof promptly upon being requested to do
so by any Lender and shall thereupon notify all the Lenders
thereof.
Section 9.6. Expenses. The
Borrowers jointly and severally agree to pay to the Administrative Agent and
each Lender, and any other holder of any Note outstanding hereunder, all costs
and expenses incurred or paid by the Administrative Agent and such Lender or
any
such holder, including reasonable attorneys’ fees and court costs, in connection
with any Default or Event of Default hereunder or in connection with the
enforcement of any of the Loan Documents (including all such costs and expenses
incurred in connection with any proceeding under the United States Bankruptcy
Code involving any Borrower or any Subsidiary as a debtor
thereunder).
Section 10.1. Change
of Law. Notwithstanding any other provisions of this Agreement
or any other Loan Document, if at any time any change in applicable law or
regulation or in the interpretation thereof makes it unlawful for any Lender
to
make or continue to maintain any Eurocurrency Loans or to perform its
obligations as contemplated hereby, such Lender shall promptly give notice
thereof to the Borrowers and such Lender’s obligations to make or maintain
Eurocurrency Loans under this Agreement shall be suspended until it is no longer
unlawful for such Lender to make or maintain Eurocurrency Loans. The
applicable Borrower shall prepay on demand the outstanding principal amount
of
any such affected Eurocurrency Loans, together with all interest accrued thereon
and all other amounts then due and payable to such Lender under this Agreement;
provided, however,
subject to all of the terms and conditions of this Agreement, the Company,
on
behalf of the applicable Borrower, may then elect to borrow the principal amount
of the affected Eurocurrency Loans from such Lender by means of Base Rate Loans
from such Lender, which Base Rate Loans shall not be made ratably by the Lenders
but only from such affected Lender.
Section 10.2. Unavailability
of Deposits or Inability to Ascertain, or Inadequacy of,
LIBOR. If on or prior to the first day of any Interest Period
for any Borrowing of Eurocurrency Loans:
(a) the
Administrative Agent determines that deposits in U.S. Dollars (in the applicable
amounts) are not being offered to it in the interbank Eurocurrency market for
such Interest Period, or that by reason of circumstances affecting the interbank
Eurocurrency market adequate and reasonable means do not exist for ascertaining
the applicable LIBOR, or
(b) the
Required Lenders advise the Administrative Agent that (i) LIBOR as determined
by
the Administrative Agent will not adequately and fairly reflect the cost to
such
Lenders of funding their Eurocurrency Loans for such Interest Period or (ii)
that the making or funding of Eurocurrency Loans become
impracticable,
then
the
Administrative Agent shall forthwith give notice thereof to the Borrowers and
the Lenders, whereupon until the Administrative Agent notifies the Borrowers
that the circumstancesgiving rise to such suspension no
longer exist, the obligations of the Lenders to make Eurocurrency Loans shall
be
suspended.
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Section 10.3. Increased
Cost and Reduced Return. (a) If, on or after the date
hereof, the adoption of any applicable law, rule or regulation, or any change
therein, or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender (or its
Lending Office) or the L/C Issuer with any request or directive (whether or
not having the force of law) of any such authority, central bank or comparable
agency:
(i) shall
subject any Lender (or its Lending Office) or the L/C Issuer to any tax,
duty or other charge with respect to its Eurodollar Loans, its Notes, its
Letter(s) of Credit, or its participation in any thereof, any Reimbursement
Obligations owed to it or its obligation to make Eurodollar Loans, issue a
Letter of Credit, or to participate therein, or shall change the basis of
taxation of payments to any Lender (or its Lending Office) or the
L/C Issuer of the principal of or interest on its Eurodollar Loans,
Letter(s) of Credit, or participations therein or any other amounts due under
this Agreement or any other Loan Document in respect of its Eurodollar Loans,
Letter(s) of Credit, any participation therein, any Reimbursement Obligations
owed to it, or its obligation to make Eurodollar Loans, or issue a Letter of
Credit, or acquire participations therein (except for changes in the rate of
tax
on the overall net income of such Lender or its Lending Office or the
L/C Issuer imposed by the jurisdiction in which such Lender’s or the
L/C Issuer’s principal executive office or Lending Office is located);
or
(ii) shall
impose, modify or deem applicable any reserve, special deposit or similar
requirement (including, without limitation, any such requirement imposed by
the
Board of Governors of the Federal Reserve System, but excluding with respect
to
any Eurodollar Loans any such requirement included in an applicable Eurodollar
Reserve Percentage) against assets of, deposits with or for the account of,
or
credit extended by, any Lender (or its Lending Office) or the L/C Issuer or
shall impose on any Lender (or its Lending Office) or the L/C Issuer or on
the interbank market any other condition affecting its Eurodollar Loans, its
Notes, its Letter(s) of Credit, or its participation in any thereof, any
Reimbursement Obligation owed to it, or its obligation to make Eurodollar Loans,
or to issue a Letter of Credit, or to participate therein;
and
the
result of any of the foregoing is to increase the cost to such Lender (or its
Lending Office) or the L/C Issuer of making or maintaining any Eurodollar
Loan, issuing or maintaining a Letter of Credit, or participating therein,
or to
reduce the amount of any sum received or receivable by such Lender (or its
Lending Office) or the L/C Issuer under this Agreement or under any other
Loan Document with respect thereto, by an amount deemed by such Lender or
L/C Issuer to be material, then, within 15 days after demand by such
Lender or L/C Issuer (with a copy to the Administrative Agent), the
Borrowers shall be obligated to pay to such Lender or L/C Issuer such
additional amount or amounts as will compensate such Lender or L/C Issuer
for such increased cost or reduction. Any demand on the Borrowers by
a Lender under this Section shall be accompanied by a certificate setting forth
the amount of such increased cost or reduced sum in reasonable detail (including
an explanation of the basis for and computation of such increased cost or
reduced return).
60
(b) If,
after the date hereof, any Lender, the L/ C Issuer, or the Administrative Agent
shall have determined that the adoption of any applicable law, rule or
regulation regarding capital adequacy, or any change therein, or any change
in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or its Lending Office)
or
the L/C Issuer or any corporation controlling such Lender or
L/C Issuer with any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank
or
comparable agency, has had the effect of reducing the rate of return on such
Lender’s or L/C Issuer ’s or such corporation’s capital as a consequence of
its obligations hereunder to a level below that which such Lender or
L/C Issuer or such corporation could have achieved but for such adoption,
change or compliance (taking into consideration such Lender’s or L/C Issuer
’s or such corporation’s policies with respect to capital adequacy) by an amount
deemed by such Lender or L/C Issuer to be material, then from time to time,
within 15 days after demand by such Lender or L/C Issuer (with a copy
to the Administrative Agent), the Borrower shall pay to such Lender or
L/C Issuer, as applicable, such additional amount or amounts as will
compensate such Lender or L/C Issuer for such reduction. Any
demand on the Borrowers by a Lender under this Section shall be accompanied
by a
certificate setting forth the amount of such reduced return in reasonable detail
(including an explanation of the basis for and the computation of such reduced
return).
(c) A
certificate of a Lender or L/C Issuer claiming compensation under this
Section 10.3 and setting forth the additional amount or amounts to be paid
to it hereunder shall be conclusive, absent manifest error, if reasonably
determined. In determining such amount, such Lender or
L/C Issuer may use any reasonable averaging and attribution
methods.
Section 10.4. Lending
Offices. Each Lender may, at its option, elect to make its
Loans hereunder at the branch, office or affiliate specified on the appropriate
signature page hereof (each a “Lending Office”) for each
type of Loan available hereunder or at such other of its branches, offices
or
affiliates as it may from time to time elect and designate in a written notice
to the Borrower and the Administrative Agent. To the extent
reasonably possible, a Lender shall designate an alternative branch or funding
office with respect to its Eurocurrency Loans to reduce any liability of the
Borrowers to such Lender under Section 10.3 hereof or to avoid the
unavailability of Eurocurrency Loans under Section 10.2 hereof, so long as
such designation is not otherwise disadvantageous to the Lender.
Section 10.5. Discretion
of Lender as to Manner of Funding. Notwithstanding any other
provision of this Agreement, each Lender shall be entitled to fund and maintain
its funding of all or any part of its Loans in any manner it sees fit, it being
understood, however, that for the purposes of this Agreement all determinations
hereunder with respect to Eurocurrency Loans shall be made as if each Lender
had
actually funded and maintained each Eurocurrency Loan through the purchase
of
deposits in the interbank Eurocurrency market having a maturity corresponding
to
such Loan’s Interest Period, and bearing an interest rate equal to LIBOR for
such Interest Period.
61
Section 11.1. Appointment and Authorization of Administrative
Agent. Each Lender and the L/C Issuer hereby
appoints Bank of Montreal as the Administrative Agent under the Loan Documents
and hereby authorizes the Administrative Agent to take such action as
Administrative Agent on its behalf and to exercise such powers under the Loan
Documents as are delegated to the Administrative Agent by the terms thereof,
together with such powers as are reasonably incidental thereto. The
Lenders and L/C Issuer expressly agree that the Administrative Agent is not
acting as a fiduciary of the Lenders or the L/C Issuer in respect of the
Loan Documents, the Borrower or otherwise, and nothing herein or in any of
the
other Loan Documents shall result in any duties or obligations on the
Administrative Agent or any of the Lenders or L/C Issuer except as
expressly set forth herein.
Section 11.2. Administrative
Agent and its Affiliates. The Administrative Agent shall have
the same rights and powers under this Agreement and the other Loan Documents
as
any other Lender and may exercise or refrain from exercising such rights and
power as though it were not the Administrative Agent, and the Administrative
Agent and its Affiliates may accept deposits from, lend money to, and generally
engage in any kind of business with any Borrower or any Affiliate of such
Borrower as if it were not the Administrative Agent under the Loan
Documents. The term “Lender” as used herein and
in all other Loan Documents, unless the context otherwise clearly requires,
includes the Administrative Agent in its individual capacity as a Lender (if
applicable).
Section 11.3. Action
by Administrative Agent. If the Administrative Agent receives
from any Borrower a written notice of an Event of Default pursuant to
Section 8.5 hereof, the Administrative Agent shall promptly give each of
the Lenders and L/C Issuer written notice thereof. The
obligations of the Administrative Agent under the Loan Documents are only those
expressly set forth therein. Without limiting the generality of the
foregoing, the Administrative Agent shall not be required to take any action
hereunder with respect to any Default or Event of Default, except as expressly
provided in Sections 9.2 and 9.5. Upon the occurrence of an
Event of Default, the Administrative Agent shall take such action to enforce
its
Lien on the Collateral and to preserve and protect the Collateral as may be
directed by the Required Lenders. Unless and until the Required
Lenders give such direction, the Administrative Agent may (but shall not be
obligated to) take or refrain from taking such actions as it deems appropriate
and in the best interest of all the Lenders and L/C Issuer. In
no event, however, shall the Administrative Agent be required to take any action
in violation of applicable law or of any provision of any Loan Document, and
the
Administrative Agent shall in all cases be fully justified in failing or
refusing to act hereunder or under any other Loan Document unless it first
receives any further assurances of its indemnification from the Lenders that
it
may require, including prepayment of any related expenses and any other
protection it requires against any and all costs, expense, and liability which
may be incurred by it by reason of taking or continuing to take any such
action. The Administrative Agent shall be entitled to assume that no
Default or Event of Default exists unless notified in writing to the contrary
by
a Lender, the L/C Issuer, or the Company or a Borrower. In all
cases in which the Loan Documents do not require the Administrative Agent to
take specific action, the Administrative Agent shall be fully justified in
using
its discretion in failing to take or in taking any action
thereunder. Any instructions of the Required Lenders, or of any other
group of Lenders called for under the specific provisions of the Loan Documents,
shall be binding upon all the Lenders and the holders of the
Obligations.
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Section 11.4. Consultation
with Experts. The Administrative Agent may consult with legal
counsel, independent public accountants, and other experts selected by it in
good faith and shall not be liable for any action taken or omitted to be taken
by it in good faith in accordance with the advice of such counsel, accountants
or experts.
Section 11.5. Liability
of Administrative Agent; Credit Decision. Neither the
Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action taken or not taken by it in connection with
the
Loan Documents: (i) with the consent or at the request of the
Required Lenders or (ii) in the absence of its own gross negligence or
willful misconduct. Neither the Administrative Agent nor any of its
directors, officers, agents or employees shall be responsible for or have any
duty to ascertain, inquire into or verify: (i) any statement,
warranty or representation made in connection with this Agreement, any other
Loan Document or any Credit Event; (ii) the performance or observance of
any of the covenants or agreements of the Credit Parties or any Subsidiary
contained herein or in any other Loan Document; (iii) the satisfaction of
any condition specified in Section 7 hereof, except receipt of items
required to be delivered to the Administrative Agent; or (iv) the validity,
effectiveness, genuineness, enforceability, perfection, value, worth or
collectibility hereof or of any other Loan Document or of any other documents
or
writing furnished in connection with any Loan Document or of any Collateral;
and
the Administrative Agent makes no representation of any kind or character with
respect to any such matter mentioned in this sentence. The
Administrative Agent may execute any of its duties under any of the Loan
Documents by or through employees, agents, and attorneys-in-fact and shall
not
be answerable to the Lenders, the L/C Issuer, the Credit Parties, or any
other Person for the default or misconduct of any such agents or
attorneys-in-fact selected with reasonable care. The Administrative
Agent shall not incur any liability by acting in reliance upon any notice,
consent, certificate, other document or statement (whether written or oral)
reasonably believed by it to be genuine or to be sent by the proper party or
parties. In particular and without limiting any of the foregoing, the
Administrative Agent shall have no responsibility for confirming the accuracy
of
any compliance certificate or other document or instrument received by it under
the Loan Documents. The Administrative Agent may treat the payee of
any Obligation as the holder thereof until written notice of transfer shall
have
been filed with the Administrative Agent signed by such payee in form
satisfactory to the Administrative Agent. Each Lender and
L/C Issuer acknowledges that it has independently and without reliance on
the Administrative Agent or any other Lender or L/C Issuer, and based upon
such information, investigations and inquiries as it deems appropriate, made
its
own credit analysis and decision to extend credit to the Borrowers in the manner
set forth in the Loan Documents. It shall be the responsibility of
each Lender and L/C Issuer to keep itself informed as to the
creditworthiness of the Borrowers and their Subsidiaries, and the Administrative
Agent shall have no liability to any Lender or L/C Issuer with respect
thereto.
Section 11.6. Indemnity. The
Lenders shall ratably, in accordance with their respective Percentages,
indemnify and hold the Administrative Agent, and its directors, officers,
employees, agents, and representatives harmless from and against any
liabilities, losses, costs or expenses suffered or incurred by it under any
Loan
Document or in connection with the transactions contemplated thereby, regardless
of when asserted or arising, except to the extent they are promptly reimbursed
for the same by the Borrowers and except to the extent that any event giving
rise to a claim was caused by the gross negligence or willful misconduct of
the
party seeking to be indemnified. The obligations of the Lenders under
this Section shall survivetermination of this
Agreement. The Administrative Agent shall be entitled to offset
amounts received for the account of a Lender under this Agreement against unpaid
amounts due from such Lender to the Administrative Agent hereunder (whether
as
fundings of participations, indemnities or otherwise), but shall not be entitled
to offset against amounts owed to the Administrative Agent by any Lender arising
outside of this Agreement and the other Loan Documents.
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Section 11.7. Resignation
of Administrative Agent and Successor Administrative
Agent. The Administrative Agent may resign at any time by
giving written notice thereof to the Lenders, the L/C Issuer, and the
Borrowers and may be removed by the Required Lenders upon twenty (20) days
prior
written notice to the Borrowers, the Administrative Agent, the L/C Issuers
and
the Lenders. Upon any such resignation or removal of the
Administrative Agent, the Required Lenders shall have the right to appoint
a
successor Administrative Agent, which appointment shall be with the Borrowers’
consent if no Event of Default exists. If no successor Administrative
Agent shall have been so appointed by the Required Lenders, and shall have
accepted such appointment after the Administrative Agent has delivered its
notice of resignation, within 30 days after the retiring Administrative
Agent’s giving of notice of resignation then the retiring Administrative Agent
may, on behalf of the Lenders, appoint a successor Administrative Agent, which
may be any Lender hereunder or any commercial bank, or an Affiliate of a
commercial bank, having an office in the United States of America and having
a
combined capital and surplus of at least $200,000,000, which appointment shall
be with the Borrowers’ consent if no Event of Default exists. Upon
the acceptance of its appointment as the Administrative Agent hereunder, such
successor Administrative Agent shall thereupon succeed to and become vested
with
all the rights and duties of the retiring Administrative Agent under the Loan
Documents, and the retiring Administrative Agent shall be discharged from its
duties and obligations thereunder. The removal of the Administrative
Agent hereunder shall become effective 20 days after receipt of such notice
of
removal, and upon the effectiveness of such removal, the removed Administrative
Agent shall be discharged from its duties and obligations under the Loan
Documents. After any retiring or removed Administrative Agent’s
resignation or removal (as the case may be) hereunder as Administrative Agent,
the provisions of this Section 11 and all protective provisions of the
other Loan Documents shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Administrative Agent, but no successor
Administrative Agent shall in any event be liable or responsible for any actions
of its predecessor. If the Administrative Agent resigns or is removed
and no successor is appointed, the rights and obligations of such Administrative
Agent shall be automatically assumed by the Required Lenders and (i) the
Borrowers shall be directed to make all payments due each Lender and
L/C Issuer hereunder directly to such Lender or L/C Issuer and
(ii) the Administrative Agent’s rights in the Collateral Documents shall be
assigned without representation, recourse or warranty to the Lenders and
L/C Issuer as their interests may appear.
Section 11.8. L/C
Issuer and Swing Line Lender. The L/C Issuer shall act on
behalf of the Lenders with respect to any Letters of Credit issued by it and
the
documents associated therewith, and the Swing Line Lender shall act on behalf
of
the Lenders with respect to the Swing Loans made hereunder. The
L/C Issuer and the Swing Line Lender shall each have all of the benefits
and immunities (i) provided to the Administrative Agent in this
Section 11 with respect to any acts taken or omissions suffered by the
L/C Issuer in connection with Letters of Credit issued by it or proposed to
be issued by it and the Applications pertaining to such Lettersof
Credit
or by the Swing Line Lender in connection with Swing Loans made or to be made
hereunder as fully as if the term “Administrative Agent”, as used in this
Section 11, included the L/C Issuer and the Swing Line Lender with
respect to such acts or omissions and (ii) as additionally provided in this
Agreement with respect to such L/C Issuer or Swing Line Lender, as
applicable.
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Section 11.9. Hedging
Liability and Funds Transfer and Deposit Account Liability
Arrangements. By virtue of a Lender’s execution of this
Agreement or an assignment agreement pursuant to Section 13.12 hereof, as
the case may be, any Affiliate of such Lender with whom any Borrower or any
Subsidiary has entered into an agreement creating Hedging Liability or Funds
Transfer and Deposit Account Liability shall be deemed a Lender party hereto
for
purposes of any reference in a Loan Document to the parties for whom the
Administrative Agent is acting, it being understood and agreed that the rights
and benefits of such Affiliate under the Loan Documents consist exclusively
of
such Affiliate’s right to share in payments and collections out of the
Collateral and the Guaranties as more fully set forth in Section 3.1
hereof. In connection with any such distribution of payments and
collections, or any request for the release of the Guaranties and the
Administrative Agent’s Liens in connection with the termination of the
Commitments and the payment in full of the Obligations, the Administrative
Agent
shall be entitled to assume no amounts are due to any Lender or its Affiliate
with respect to Hedging Liability or Funds Transfer and Deposit Account
Liability unless such Lender has notified the Administrative Agent in writing
of
the amount of any such liability owed to it or its Affiliate prior to such
distribution or payment or release of Guaranties and Liens.
Section 11.10. Designation
of Additional Agents. The Administrative Agent shall have the
continuing right, for purposes hereof, at any time and from time to time to
designate one or more of the Lenders (and/or its or their Affiliates) as
“syndication agents,” “documentation agents,” “arrangers,” or other designations
for purposes hereto, but such designation shall have no substantive effect,
and
such Lenders and their Affiliates shall have no additional powers, duties or
responsibilities as a result thereof.
Section 11.11. Authorization
to Release or Subordinate or Limit Liens. The Administrative
Agent
is hereby irrevocably authorized by each of the Lenders and the L/C Issuer
to (a) release any Lien covering any Collateral that is sold, transferred,
or otherwise disposed of in accordance with the terms and conditions of this
Agreement and the relevant Collateral Documents (including a sale, transfer,
or
disposition permitted by the terms of Section 8.10 hereof or which has
otherwise been consented to in accordance with Section 13.13 hereof),
(b) release or subordinate any Lien on Collateral consisting of goods
financed with purchase money indebtedness or under a Capital Lease to the extent
such purchase money indebtedness or Capitalized Lease Obligation, and the Lien
securing the same, are permitted by Sections 8.7(c) and 8.8(d) hereof,
(c) reduce or limit the amount of the indebtedness secured by any
particular item of Collateral to an amount not less than the estimated value
thereof to the extent necessary to reduce mortgage registry, filing and similar
tax, and (d) release Liens on the Collateral following termination or
expiration of the Commitments and payment in full in cash of the Obligations
and, if then due, Hedging Liability and Funds Transfer and Deposit Account
Liability.
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Section 11.12. Authorization
to Enter into, and Enforcement of, the Collateral
Documents. The Administrative Agent is hereby irrevocably
authorized by each of the Lenders and the L/C Issuer to execute and deliver
the Collateral Documents on behalf of each of the Lenders and their Affiliates
and the L/C Issuer and to take such action and exercise such powers under
the Collateral Documents as the Administrative Agent considers appropriate,
provided the
Administrative Agent shall not amend the Collateral Documents unless such
amendment is agreed to in writing by the Required Lenders. Each
Lender and L/C Issuer acknowledges and agrees that it will be bound by the
terms and conditions of the Collateral Documents upon the execution and delivery
thereof by the Administrative Agent. Except as otherwise specifically
provided for herein, no Lender (or its Affiliates) or L/C Issuer, other
than the Administrative Agent, shall have the right to institute any suit,
action or proceeding in equity or at law for the foreclosure or other
realization upon any Collateral or for the execution of any trust or power
in
respect of the Collateral or for the appointment of a receiver or for the
enforcement of any other remedy under the Collateral Documents; it being
understood and intended that no one or more of the Lenders (or their Affiliates)
or L/C Issuer shall have any right in any manner whatsoever to affect,
disturb or prejudice the Lien of the Administrative Agent (or any security
trustee therefor) under the Collateral Documents by its or their action or
to
enforce any right thereunder, and that all proceedings at law or in equity
shall
be instituted, had, and maintained by the Administrative Agent (or its security
trustee) in the manner provided for in the relevant Collateral Documents for
the
benefit of the Lenders, the L/C Issuer, and their Affiliates.
Section 12.1. The
Guarantees. To induce the Lenders and L/C Issuer to
provide the credits described herein and in consideration of benefits expected
to accrue to the Borrowers by reason of the Commitments and for other good
and
valuable consideration, receipt of which is hereby acknowledged, the Company
and
each Domestic Subsidiary party hereto (including any Subsidiary executing an
Additional Guarantor Supplement in the form attached hereto as Exhibit F or
such other form acceptable to the Administrative Agent) hereby unconditionally
and irrevocably guarantees jointly and severally to the Administrative Agent,
the Lenders, and the L/C Issuer and their Affiliates, the due and punctual
payment of all present and future Obligations, Hedging Liability, and Funds
Transfer and Deposit Account Liability, including, but not limited to, the
due
and punctual payment of principal of and interest on the Loans, the
Reimbursement Obligations, and the due and punctual payment of all other
Obligations now or hereafter owed by the Borrowers, or any of them, under the
Loan Documents and the due and punctual payment of all Hedging Liability and
Funds Transfer and Deposit Account Liability, in each case as and when the
same
shall become due and payable, whether at stated maturity, by acceleration,
or
otherwise, according to the terms hereof and thereof (including all interest,
costs, fees, and charges after the entry of an order for relief against any
Borrower or such other obligor in a case under the United States Bankruptcy
Code
or any similar proceeding, whether or not such interest, costs, fees and charges
would be an allowed claim against any Borrower or any such obligor in any such
proceeding). In case of failure by a Borrower or other obligor
punctually to pay any Obligations, Hedging Liability, or Funds Transfer and
Deposit Account Liability guaranteed hereby, each Guarantor hereby
unconditionally agrees to make such payment or to cause such payment to be
made
punctually as and when the same shall become due and payable, whether at stated
maturity, by acceleration, or otherwise, and as if such payment were made by
such Borrower.
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Section 12.2. Guarantee
Unconditional. The obligations of each Guarantor under this
Section 12 shall be unconditional and absolute and, without limiting the
generality of the foregoing, shall not be released, discharged, or otherwise
affected by:
(a) any
extension, renewal, settlement, compromise, waiver, or release in respect of
any
obligation of any Borrower or of any other Guarantor under this Agreement or
any
other Loan Document or by operation of law or otherwise;
(b) any
modification or amendment of or supplement to this Agreement or any other Loan
Document or any agreement relating to Hedging Liability or Funds Transfer and
Deposit Account Liability;
(c) any
change in the corporate existence, structure, or ownership of, or any
insolvency, bankruptcy, reorganization, or other similar proceeding affecting,
any Borrower, any other Guarantor, or any of their respective assets, or any
resulting release or discharge of any obligation of any Borrower or of any
other
Guarantor contained in any Loan Document;
(d) the
existence of any claim, set-off, or other rights which any Borrower or any
other
Guarantor may have at any time against the Administrative Agent, any Lender,
the
L/C Issuer or any other Person, whether or not arising in connection
herewith;
(e) any
failure to assert, or any assertion of, any claim or demand or any exercise
of,
or failure to exercise, any rights or remedies against any Borrower, any other
Guarantor, or any other Person or Property;
(f) any
application of any sums by whomsoever paid or howsoever realized to any
obligation of any Borrower, regardless of what obligations of the Borrowers
remain unpaid;
(g) any
invalidity or unenforceability relating to or against any Borrower or any other
Guarantor for any reason of this Agreement or of any other Loan Document or
any
agreement relating to Hedging Liability or Funds Transfer and Deposit Account
Liability or any provision of applicable law or regulation purporting to
prohibit the payment by any Borrower or any other Guarantor of the principal
of
or interest on any Loan or any Reimbursement Obligation or any other amount
payable under the Loan Documents or any agreement relating to Hedging Liability
or Funds Transfer and Deposit Account Liability; or
(h) any
other act or omission to act or delay of any kind by the Administrative Agent,
any Lender, the L/C Issuer or any other Person or any other circumstance
whatsoever that might, but for the provisions of this paragraph, constitute
a
legal or equitable discharge of the obligations of the Borrowers under this
Section 12.
Section 12.3. Discharge
Only upon Payment in Full; Reinstatement in Certain
Circumstances. Each Guarantor’s obligations under this
Section 12 shall remain in full force and effect until the Commitments are
terminated, all Letters of Credit have expired, and the principal of and
interest on the Loans and all other amounts payable by the Borrowers and the
Guarantorsunder this Agreement and all other Loan Documents
and, if then outstanding and unpaid, all Hedging Liability and Funds Transfer
and Deposit Account Liability, shall have been paid in full. If at
any time any payment of the principal of or interest on any Loan or any
Reimbursement Obligation or any other amount payable by any Borrower or any
Guarantor under the Loan Documents or any agreement relating to Hedging
Liability or Funds Transfer and Deposit Account Liability is rescinded or must
be otherwise restored or returned upon the insolvency, bankruptcy, or
reorganization of any Borrower or of any Guarantor, or otherwise, each
Guarantor’s obligations under this Section 12 with respect to such payment
shall be reinstated at such time as though such payment had become due but
had
not been made at such time.
67
Section 12.4. Subrogation. Each
Guarantor agrees it will not exercise any rights which it may acquire by way
of
subrogation by any payment made hereunder, or otherwise, until all the
Obligations, Hedging Liability, and Funds Transfer and Deposit Account Liability
shall have been paid in full subsequent to the termination of the Commitments
and expiration of all Letters of Credit. If any amount shall be paid
to a Guarantor on account of such subrogation rights at any time prior to the
later of (x) the payment in full of the Obligations, Hedging Liability, and
Funds Transfer and Deposit Account Liability and all other amounts payable
by
the Borrowers hereunder and the other Loan Documents and (y) the
termination of the Commitments and expiration of all Letters of Credit, such
amount shall be held in trust for the benefit of the Administrative Agent,
the
Lenders, and the L/C Issuers (and their Affiliates) and shall forthwith be
paid
to the Administrative Agent for the benefit of the Lenders the L/C Issuers
(and
their Affiliates) or be credited and applied upon the Obligations, Hedging
Liability, and Funds Transfer and Deposit Account Liability, whether matured
or
unmatured, in accordance with the terms of this Agreement.
Section 12.5. Waivers. Each
Guarantor irrevocably waives acceptance hereof, presentment, demand, protest,
and any notice not provided for herein, as well as any requirement that at
any
time any action be taken by the Administrative Agent, any Lender, the L/C Issuer
or any other Person against any Borrower, another Guarantor, or any other
Person.
Section 12.6. Limit
on Recovery. Notwithstanding any other provision hereof, the
right of recovery against each Guarantor under this Section 12 shall not
exceed $1.00 less than the lowest amount which would render such Guarantor’s
obligations under this Section 12 void or voidable under applicable law,
including, without limitation, fraudulent conveyance law.
Section 12.7. Stay
of Acceleration. If acceleration of the time for payment of
any amount payable by any Borrower under this Agreement or any other Loan
Document, or under any agreement establishing Hedging Liability or Funds
Transfer and Deposit Account Liability, is stayed upon the insolvency,
bankruptcy or reorganization of any Borrower, all such amounts otherwise subject
to acceleration under the terms of this Agreement or the other Loan Documents,
or under any agreement establishing Hedging Liability or Funds Transfer and
Deposit Account Liability, shall nonetheless be payable by the Guarantors
hereunder forthwith on demand by the Administrative Agent made at the request
of
the Required Lenders.
Section 12.8. Benefit
to Guarantors. Each Guarantor will derive substantial direct
and indirect benefit from the extensions of credit hereunder.
68
Section
12.9. Guarantor
Covenants. Each Guarantor shall take such action as the
Borrowers are required by this Agreement to cause such Guarantor to take, and
shall refrain from taking such action as the Borrowers are required by this
Agreement to prohibit such Guarantor from taking.
Section
12.10. Joint and
Several Obligors. (a) Each Borrower agrees that it is jointly
and severally liable for all the Obligations, Hedging Liability and Funds
Transfer and Deposit Account Liability of each other Borrower; provided, however, no Foreign
Borrower shall be liable (whether as a joint and several obligor or as a
guarantor) for the Obligations, Hedging Liability and Funds Transfer and Deposit
Account Liability of any Domestic Borrower. Each Borrower further
acknowledges and agrees that its joint and several liability on the Loans and
on
all other Obligations, Hedging Liability and Funds Transfer and Deposit Account
Liability owed by any Borrower or Borrowers is absolute and unconditional and
shall not in any manner be affected or impaired by any acts or omissions
whatsoever by the Lenders or the Administrative Agent, and without limiting
the
generality of the foregoing, each Borrower’s joint and several liability on the
Obligations, Hedging Liability and Funds Transfer and Deposit Account Liability
of the Borrowers shall not be impaired by any acceptance by the Administrative
Agent or the Lenders of any other security for or guarantors upon the
Obligations, Hedging Liability and Funds Transfer and Deposit Account Liability
or by any failure, neglect or omission on the Lenders’ or the Administrative
Agent’s part to resort to any one or all of the Borrowers for payment of the
Obligations, Hedging Liability and Funds Transfer and Deposit Account Liability
or to realize upon or protect any collateral security therefor. Each
Borrower’s joint and several liability on the Obligations, Hedging Liability and
Funds Transfer and Deposit Account Liability of each Borrower shall not in
any
manner be impaired or affected by who receives or uses the proceeds of the
Loans
or for what purposes such proceeds are used, and each Borrower waives notice
of
borrowing requests issued by, and loans made to, other
Borrowers. Such joint and several liability of each Borrower shall
also not be impaired or affected by any sale, pledge, surrender, compromise,
settlement, release, renewal, extension, indulgence, alteration, substitution,
exchange, change in, modification or disposition of any collateral security
for
the Obligations, Hedging Liability and Funds Transfer and Deposit Account
Liability or of any guaranty thereof. In order to enforce payment of
the Obligations, Hedging Liability and Funds Transfer and Deposit Account
Liability, foreclose or otherwise realize on any collateral security therefor,
and to exercise the rights granted to the Administrative Agent hereunder and
thereunder and under applicable law, the Administrative Agent shall be under
no
obligation at any time to first resort to any collateral security, property,
liens or any other rights or remedies whatsoever, and the Lenders shall have
the
right to enforce the Obligations, Hedging Liability and Funds Transfer and
Deposit Account Liability irrespective of whether or not other proceedings
or
steps are pending seeking resort to or realization upon or from any of the
foregoing. By its acceptance below, each Borrower hereby expressly
waives and surrenders any defense to its joint and several liability on the
Obligations, Hedging Liability and Funds Transfer and Deposit Account Liability
of each Borrower based upon any of the foregoing. In furtherance
thereof, each Borrower agrees that wherever in this Agreement it is provided
that a Borrower is liable for a payment such obligation is the joint and several
obligation of each Borrower; provided, however, no Foreign
Borrower shall be liable (whether as a joint and several obligor or as a
guarantor) for the Obligations, Hedging Liability and Funds Transfer and Deposit
Account Liability of any Domestic Borrower.
69
Section 13.1. Withholding
Taxes. (a) Payments Free of
Withholding. Except as otherwise required by law and subject
to Section 13.1(b) hereof, each payment by any Borrower and the Guarantors
under this Agreement or the other Loan Documents shall be made without
withholding for or on account of any present or future taxes (other than overall
net income taxes on the recipient) imposed by or within the jurisdiction in
which such Borrower or such Guarantor is domiciled, any jurisdiction from which
such Borrower or such Guarantor makes any payment, or (in each case) any
political subdivision or taxing authority thereof or therein. If any
such withholding is so required, the relevant Borrower or such Guarantor shall
make the withholding, pay the amount withheld to the appropriate governmental
authority before penalties attach thereto or interest accrues thereon and
forthwith pay such additional amount as may be necessary to ensure that the
net
amount actually received by each Lender, the L/C Issuer and the Administrative
Agent free and clear of such taxes (including such taxes on such additional
amount) is equal to the amount which that Lender, L/C Issuer or the
Administrative Agent (as the case may be) would have received had such
withholding not been made. If the Administrative Agent, the L/C
Issuer, or any Lender pays any amount in respect of any such taxes, penalties
or
interest, the Borrowers or such Guarantor shall reimburse the Administrative
Agent, or L/C Issuer or such Lender for that payment on demand in the currency
in which such payment was made. If any Borrower or such Guarantor
pays any such taxes, penalties or interest, it shall deliver official tax
receipts evidencing that payment or certified copies thereof to the Lender,
the
L/C Issuer or Administrative Agent on whose account such withholding was made
(with a copy to the Administrative Agent if not the recipient of the original)
on or before the thirtieth day after payment.
(b) U.S.
Withholding Tax
Exemptions. Each Lender or L/C Issuer that is not a
United States person (as such term is defined in Section 7701(a)(30) of the
Code) shall submit to the Borrower and the Administrative Agent on or before
the
date the initial Credit Event is made hereunder or, if later, the date such
financial institution becomes a Lender or L/C Issuer hereunder, two duly
completed and signed copies of (i) either Form W-8 BEN (relating to
such Lender or L/C Issuer and entitling it to a complete exemption from
withholding under the Code on all amounts to be received by such Lender or
L/C Issuer, including fees, pursuant to the Loan Documents and the
Obligations) or Form W-8 ECI (relating to all amounts to be received by
such Lender or L/C Issuer, including fees, pursuant to the Loan Documents
and the Obligations) of the United States Internal Revenue Service or (ii)
solely if such Lender is claiming exemption from United States withholding
tax
under Section 871(h) or 881(c) of the Code with respect to payments of
“portfolio interest”, a Form W-8 BEN, or any successor form prescribed by
the Internal Revenue Service, and a certificate representing that such Lender
is
not a bank for purposes of Section 881(c) of the Code, is not a 10-percent
shareholder (within the meaning of Section 871(h)(3)(B) of the Code) of any
Borrower and is not a controlled foreign corporation related to any Borrower
(within the meaning of Section 864(d)(4) of the
Code). Thereafter and from time to time, each Lender and
L/C Issuer shall submit to the Borrowers and the Administrative Agent such
additional duly completed and signed copies of one or the other of such Forms
(or such successor forms as shall be adopted from time to time by the relevant
United States taxing authorities) and such other certificates as may be
(i) requested by the Company, on behalf of Borrowers, in a written notice,
directly or through the Administrative Agent, to such Lender or L/C Issuer
and (ii) required under then-current United States law orregulations to avoid or reduce United States withholding
taxes on
payments in respect of all amounts to be received by such Lender or
L/C Issuer, including fees, pursuant to the Loan Documents or the
Obligations. Upon the request of the Company, on behalf of the
Borrowers, or the Administrative Agent, each Lender and L/C Issuer that is
a United States person (as such term is defined in Section 7701(a)(30) of
the Code) shall submit to the Company and the Administrative Agent a certificate
to the effect that it is such a United States person.
70
(c) Inability
of Lender to Submit
Forms. If any Lender or L/C Issuer determines, as a
result of any change in applicable law, regulation or treaty, or in any official
application or interpretation thereof, that it is unable to submit to the
Borrowers or the Administrative Agent any form or certificate that such Lender
or L/C Issuer is obligated to submit pursuant to subsection (b) of
this Section 13.1 or that such Lender or L/C Issuer is required to
withdraw or cancel any such form or certificate previously submitted or any
such
form or certificate otherwise becomes ineffective or inaccurate, such Lender
or
L/C Issuer shall promptly notify the Borrowers and Administrative Agent of
such fact and the Lender or L/C Issuer shall to that extent not be
obligated to provide any such form or certificate and will be entitled to
withdraw or cancel any affected form or certificate, as applicable.
Section 13.2. No
Waiver, Cumulative Remedies. No delay or failure on the part
of the Administrative Agent, the L/C Issuer or any Lender or on the part of
the
holder or holders of any of the Obligations in the exercise of any power or
right under any Loan Document shall operate as a waiver thereof or as an
acquiescence in any default, nor shall any single or partial exercise of any
power or right preclude any other or further exercise thereof or the exercise
of
any other power or right. The rights and remedies hereunder of the
Administrative Agent, the Lenders and of the holder or holders of any of the
Obligations are cumulative to, and not exclusive of, any rights or remedies
which any of them would otherwise have.
Section 13.3. Non-Business
Days. If any payment hereunder becomes due and payable on a
day which is not a Business Day, the due date of such payment shall be extended
to the next succeeding Business Day on which date such payment shall be due
and
payable. In the case of any payment of principal falling due on a day
which is not a Business Day, interest on such principal amount shall continue
to
accrue during such extension at the rate per annum then in effect, which accrued
amount shall be due and payable on the next scheduled date for the payment
of
interest.
Section 13.4. Documentary
Taxes. The Borrowers jointly and severally agree to pay on
demand any documentary, stamp or similar taxes payable in respect of this
Agreement or any other Loan Document, including interest and penalties, in
the
event any such taxes are assessed, irrespective of when such assessment is
made
and whether or not any is then in use or available hereunder.
Section 13.5. Survival
of Representations. All representations and warranties made
herein or in any other Loan Document or in certificates given pursuant hereto
or
thereto shall survive the execution and delivery of this Agreement and the
other
Loan Documents, and shall continue in full force and effect with respect to
the
date as of which they were made as long as any credit is in use or available
hereunder.
71
Section 13.6. Survival
of Indemnities. All indemnities and other provisions relative
to reimbursement to the Lenders and L/C Issuer of amounts sufficient to
protect the yield of the Lenders and L/C Issuer with respect to the Loans
and Letters of Credit, including, but not limited to, Sections 1.12, 10.3,
and 13.15 hereof, shall survive the termination of this Agreement and the other
Loan Documents and the payment of the Obligations.
Section 13.7. Sharing
of Set-Off. Each Lender agrees with each other Lender a party
hereto that if such Lender shall receive and retain any payment, whether by
set-off or application of deposit balances or otherwise, on any of the Loans
or
Reimbursement Obligations in excess of its ratable share of payments on all
such
Obligations then outstanding to the Lenders, then such Lender shall purchase
for
cash at face value, but without recourse, ratably from each of the other Lenders
such amount of the Loans or Reimbursement Obligations, or participations
therein, held by each such other Lenders (or interest therein) as shall be
necessary to cause such Lender to share such excess payment ratably with all
the
other Lenders; provided,
however, that if any such purchase is made by any Lender, and if such
excess payment or part thereof is thereafter recovered from such purchasing
Lender, the related purchases from the other Lenders shall be rescinded ratably
and the purchase price restored as to the portion of such excess payment so
recovered, but without interest. For purposes of this Section,
amounts owed to or recovered by the L/C Issuer in connection with Reimbursement
Obligations in which Lenders have been required to fund their participation
shall be treated as amounts owed to or recovered by the L/C Issuer as a Lender
hereunder.
Section 13.8. Notices. Except
as otherwise specified herein, all notices hereunder and under the other Loan
Documents shall be in writing (including, without limitation, notice by
telecopy) and shall be given to the relevant party at its address or telecopier
number set forth below, or such other address or telecopier number as such
party
may hereafter specify by notice to the Administrative Agent and the Borrowers
given by courier, by United States certified or registered mail, by telecopy
or
by other telecommunication device capable of creating a written record of such
notice and its receipt. Notices under the Loan Documents to any
Lender shall be addressed to its address or telecopier number set forth on
its
Administrative Questionnaire; and notices under the Loans Documents to the
Borrowers, any Guarantor, the Administrative Agent or L/C Issuer shall be
addressed to its respective address or telecopier number set forth
below:
to
any Borrower or any Guarantor:
RC2
Corporation
0000
Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx
Xxxxx, Xxxxxxxx 00000
Attention: Xx.
Xxxx Xxxxxxxxx
Telephone: (000)
000-0000,
ext. 7326
Telecopy: (000)
000-0000
|
to
the Administrative Agent and L/C Issuer :
Bank
of Montreal
000
Xxxxx XxXxxxx Xxxxxx
Xxxxxxx,
Xxxxxxxx 00000
Attention: Xx.
Xxxx X. Xxxxxx III
Telephone: (000)
000-0000
Telecopy: (000)
000-0000
|
72
with a copy
to:
Xxxxx
X.
Xxxxxx, Esq.
Xxxxxxxx
Xxxxxxx Van Deuren, S.C.
0000
Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx,
Xxxxxxxxx 00000
Telephone: (000)
000-0000
Facsimile: (000)
000-0000
Each
such
notice, request or other communication shall be effective (i) if given by
telecopier, when such telecopy is transmitted to the telecopier number specified
in this Section or in the relevant Administrative Questionnaire and a
confirmation of such telecopy has been received by the sender, (ii) if
given by mail, 5 days after such communication is deposited in the mail,
certified or registered with return receipt requested, addressed as aforesaid
or
(iii) if given by any other means, when delivered at the addresses
specified in this Section or in the relevant Administrative Questionnaire;
provided that any
notice given
pursuant to Section 1 hereof shall be effective only upon
receipt.
Section 13.9. Counterparts. This
Agreement may be executed in any number of counterparts, and by the different
parties hereto on separate counterpart signature pages, and all such
counterparts taken together shall be deemed to constitute one and the same
instrument.
Section 13.10. Successors
and Assigns. This Agreement shall be binding upon the
Borrowers and the Guarantors and their successors and assigns, and shall inure
to the benefit of the Administrative Agent, the L/C Issuer, and each of the
Lenders, and the benefit of their respective successors and assigns, including
any subsequent holder of any of the Obligations. The Borrowers and
the Guarantors may not assign any of their rights or obligations under any
Loan
Document without the written consent of all of the Lenders and, with respect
to
any Letter of Credit or the Application therefor, the
L/C Issuer.
Section 13.11. Participants. Each
Lender shall have the right at its own cost to grant participations (to be
evidenced by one or more agreements or certificates of participation) in the
Loans made and Reimbursement Obligations and/or Commitment held by such Lender
at any time and from time to time to one or more other Persons; provided that
no
such participation shall relieve any Lender of any of its obligations under
this
Agreement, and, provided, further that no such participant shall have any rights
under this Agreement except as provided in this Section, and the Administrative
Agent shall have no obligation or responsibility to such
participant. Any agreement pursuant to which such
participation is granted shall provide that the granting Lender shall
retain the sole right and responsibility to enforce the obligations of the
Borrowers under this Agreement and the other Loan Documents including, without
limitation, the right to approve any amendment, modification or waiver of any
provision of the Loan Documents, except that such agreement may provide that
such Lender will not agree to any modification, amendment or waiver of the
Loan
Documents that would reduce the amount of or postpone any fixed date for payment
of any Obligation in which such participant has an interest. Any
party to which such a participation has been granted shall have the benefits
of
Section 1.12 and Section 10.3 hereof. The Borrowers
authorize each Lender to disclose to any participant or prospective participant
under this Section any financial or other information pertaining to any Borrower
or any Subsidiary.
73
Section 13.12. Assignments. (a) Any
Lender may at any time assign to one or more Eligible Assignees all or a portion
of such Lender’s rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans at the time owing to it); provided
that
any such assignment shall be subject to the following conditions:
(i) Minimum
Amounts. (A) In the case of an assignment of the entire
remaining amount of the assigning Lender’s Commitment and the Loans and
participation interest in L/C Obligations at the time owing to it or in the
case
of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund,
no
minimum amount need be assigned; and (B) in any case not described in subsection
(a)(i)(A) of this Section, the aggregate amount of the Commitment (which for
this purpose includes Loans and participation interest in L/C Obligations
outstanding thereunder) or, if the applicable Commitment is not then in effect,
the principal outstanding balance of the Loans and participation interest in
L/C
Obligations of the assigning Lender subject to each such assignment (determined
as of the date the Assignment and Acceptance with respect to such assignment
is
delivered to the Administrative Agent or, if “Effective Date” is specified in
the Assignment and Acceptance, as of the Effective Date) shall not be less
than
$5,000,000, in the case of any assignment in respect of the Revolving Credit,
or
$5,000,000, in the case of any assignment in respect of any Term Loan, unless
each of the Administrative Agent and, so long as no Event of Default has
occurred and is continuing, the Borrowers otherwise consent (each such consent
not to be unreasonably withheld or delayed);
(ii) Proportionate
Amounts. Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Agreement with respect to the Loan or the Commitment
assigned, except that this clause (ii) shall not prohibit any Lender from
assigning all or a portion of its rights and obligations among separate Credits
on a non-pro rata
basis.
(iii) Required
Consents. No consent shall be required for any assignment
except to the extent required by Section 13.12(a)(i)(B) and, in
addition:
(a) the
consent of the Borrowers (such consent not to be unreasonably withheld or
delayed) shall be required unless (x) an Event of Default has occurred and
is
continuing at the time of such assignment or (y) such assignment is to a Lender,
an Affiliate of a Lender or an Approved Fund;
(b) the
consent of the Administrative Agent (such consent not to be unreasonably
withheld or delayed) shall be required for assignments in respect of
(i) the Revolving Credit if such assignment is to a Person that is not a
Lender with a Commitment in respect of such facility, an Affiliate of such
Lender or an Approved Fund with respect to such Lender or (ii) the Term
Loans to a Person who is not a Lender, an Affiliate of a Lender or an Approved
Fund;
(c) the
consent of the L/C Issuer (such consent not to be unreasonably withheld or
delayed) shall be required for any assignment that increases the obligation
of
the assignee to participate in exposure under one or more Letters of Credit
(whether or not then outstanding); and
74
(d) the
consent of the Swing Line Lender (such consent not to be unreasonably withheld
or delayed) shall be required for any assignment that increases the obligation
of the assignee to participate in exposure under one or more Swing Loans
(whether or not then outstanding).
(iv) Assignment
and
Acceptance. The parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Acceptance, together
with
a processing and recordation fee of $3,500, and the assignee, if it is not
a
Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.
(v) No
Assignment to any
Borrower. No such assignment shall be made to any Borrower or
any of its Affiliates or Subsidiaries.
(vi) No
Assignment to Natural
Persons. No such assignment shall be made to a natural
person.
Subject
to acceptance and recording thereof by the Administrative Agent pursuant to
Section 13.12(b) hereof, from and after the effective date specified in
each Assignment and Acceptance, the assignee thereunder shall be a party to
this
Agreement and, to the extent of the interest assigned by such Assignment and
Acceptance, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Acceptance, be released from its obligations
under this Agreement (and, in the case of an Assignment and Acceptance covering
all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto) but shall continue to be entitled
to
the benefits of Sections 13.6 and 13.15 with respect to facts and
circumstances occurring prior to the effective date of such
assignment. Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section shall
be
treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with Section 13.11
hereof.
(b) Register. The
Administrative Agent, acting solely for this purpose as an agent of the
Borrowers, shall maintain at one of its offices in Chicago, Illinois, a copy
of
each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments
of,
and principal amounts of the Loans owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”). The
entries in the Register shall be conclusive, and the Borrowers, the
Administrative Agent, and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder
for
all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by any
Borrower and any Lender, at any reasonable time and from time to time upon
reasonable prior notice.
(c) Any
Lender may at any time pledge or grant a security interest in all or any portion
of its rights under this Agreement to secure obligations of such Lender,
including any such pledge or grant to a Federal Reserve Bank, and this Section
shall not apply to any such pledge or grant of a security interest; provided that no such pledge
or grant of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or secured party for such
Lender as a party hereto; provided further, however,
the right of any suchpledgee or grantee (other than any
Federal Reserve Bank) to further transfer all or any portion of the rights
pledged or granted to it, whether by means of foreclosure or otherwise, shall
be
at all times subject to the terms of this Agreement.
75
(d) Notwithstanding
anything to the contrary herein, if at any time the Swing Line Lender assigns
all of its Revolving Credit Commitments and Revolving Loans pursuant to
subsection (a) above, the Swing Line Lender may terminate the Swing
Line. In the event of such termination of the Swing Line, the
Borrowers shall be entitled to appoint another Lender to act as the successor
Swing Line Lender hereunder (with such Lender’s consent); provided, however, that the
failure of the Company to appoint a successor shall not affect the resignation
of the Swing Line Lender. If the Swing Line Lender terminates the
Swing Line, it shall retain all of the rights of the Swing Line Lender provided
hereunder with respect to Swing Loans made by it and outstanding as of the
effective date of such termination, including the right to require Lenders
to
make Revolving Loans or fund participations in outstanding Swing Loans pursuant
to Section 1.16 hereof.
Section 13.13. Amendments. Any
provision of this Agreement or the other Loan Documents may be amended or waived
if, but only if, such amendment or waiver is in writing and is signed by (a)
the
Borrowers, (b) the Required Lenders, and (c) if the rights or duties of the
Administrative Agent, the L/C Issuer, or the Swing Line Lender are affected
thereby, the Administrative Agent, the L/C Issuer, or the Swing Line
Lender, as applicable; provided that:
(i) no
amendment or waiver pursuant to this Section 13.13 shall (A) increase
any Commitment of any Lender without the consent of such Lender, (B) reduce
the amount of or postpone the date for any scheduled payment of any principal
of
or interest on any Loan or of any Reimbursement Obligation or of any fee payable
hereunder or of any indemnity or other provision relative to reimbursement
to
the Lenders of amounts sufficient to protect the yield of the Lenders with
respect to Loans and Letters of Credit (including, but not limited to
Sections 1.12, 10.3 and 13.5 hereof), in each case, without the consent of
the Lender to which such payment is owing or which has committed to make such
Loan or Letter of Credit (or participate therein) hereunder, (C) amend,
modify or waive the application of proceeds set forth in Section 3.1
without the consent of each Lender affected thereby, or (D) amend or
modify, the pro rata application of prepayments set forth in Section 1.9
without the consent of each Lender affected thereby;
(ii) no
amendment or waiver pursuant to this Section 13.13 shall, unless signed by
each Lender, extend the Revolving Credit Termination Date, change the definition
of Required Lenders, increase the amount of Total Consideration set forth in
clause (a) of the defined term Permitted Acquisition, increase the
limitations set forth in Section 8.12(iv), increase the amount of the
Clean-Down set forth in Section 8.21(iv), amend Section 13.11 or
Section 13.12 to impose additional restrictions or requirements, change the
provisions of this Section 13.13, release all or substantially all of the
Guarantors or all
or substantial all of the Collateral (except as otherwise provided for in the
Loan Documents), or affect the number of Lenders required to take any action
hereunder or under any other Loan Document; and
76
(iii) no
amendment to Section 12 hereof shall be made without the consent of the
Borrowers or the Guarantors affected thereby.
Section 13.14. Headings.
Section headings used in this Agreement are for reference only and shall
not affect the construction of this Agreement.
Section 13.15. Costs
and Expenses; Indemnification. (a) The Borrowers
jointly and severally agree to pay all costs and expenses of the Administrative
Agent in connection with the preparation, negotiation, syndication, and
administration of the Loan Documents, including, without limitation, the
reasonable fees and disbursements of counsel to the Administrative Agent, in
connection with the preparation and execution of the Loan Documents, and any
amendment, waiver or consent related thereto, whether or not the transactions
contemplated herein are consummated, together with any fees and charges suffered
or incurred by the Administrative Agent in connection with periodic
environmental audits, fixed asset appraisals, title insurance policies,
collateral filing fees and lien searches. The Borrowers jointly and
severally agree to pay to the Administrative Agent, the L/C Issuer and each
Lender, and any other holder of any Obligations outstanding hereunder, all
costs
and expenses reasonably incurred or paid by the Administrative Agent, the
L/C Issuer, such Lender, or any such holder, including reasonable
attorneys’ fees and disbursements and court costs, in connection with any
Default or Event of Default hereunder or in connection with the enforcement
of
any of the Loan Documents (including all such costs and expenses incurred in
connection with any proceeding under the United States Bankruptcy Code involving
any Borrower or any Guarantor as a debtor thereunder). The Borrowers
further jointly and severally agree to indemnify the Administrative Agent,
the
L/C Issuer, each Lender, and any security trustee therefor, and their
respective directors, officers, employees, agents, financial advisors, and
consultants (each such Person being called an “Indemnitee”) against all losses,
claims, damages, penalties, judgments, liabilities and expenses (including,
without limitation, all reasonable fees and disbursements of counsel for any
such Indemnitee and all reasonable expenses of litigation or preparation
therefor, whether or not the Indemnitee is a party thereto, or any settlement
arrangement arising from or relating to any such litigation) which any of them
may pay or incur arising out of or relating to any Loan Document or any of
the
transactions contemplated thereby or the direct or indirect application or
proposed application of the proceeds of any Loan or Letter of Credit, other
than
those which arise from the gross negligence or willful misconduct of the party
claiming indemnification. The Borrowers, upon demand by the
Administrative Agent, the L/C Issuer or a Lender at any time, shall
reimburse the Administrative Agent, the L/C Issuer or such Lender for any
reasonable legal or other expenses (including, without limitation, all
reasonable fees and disbursements of counsel for any such Indemnitee) incurred
in connection with investigating or defending against any of the foregoing
(including any settlement costs relating to the foregoing) except if the same
is
directly due to the gross negligence or willful misconduct of the party to
be
indemnified. To the extent permitted by applicable law, no Borrower
nor any Guarantor shall assert, and each such Person hereby waives, any claim
against any Indemnitee, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement or the
other Loan Documents or any agreement or instrument contemplated hereby or
thereby, the transactions contemplated hereby or thereby, any Loan or Letter
of
Credit or the use of the proceeds thereof. The obligations of the
Borrowers under this Section shall survive the termination of this
Agreement.
77
(b) Each
Borrower unconditionally agrees to forever indemnify, defend and hold harmless,
and covenants not to xxx for any claim for contribution against, each Indemnitee
for any damages, costs, loss or expense, including without limitation, response,
remedial or removal costs and all fees and disbursements of counsel for any
such
Indemnitee, arising out of any of the following: (i) any presence,
release, threatened release or disposal of any hazardous or toxic substance
or
petroleum by any Borrower or any Subsidiary or otherwise occurring on or with
respect to its Property (whether owned or leased), (ii) the operation or
violation of any Environmental Law by any Borrower or any Subsidiary or
otherwise occurring on or with respect to its Property (whether owned or
leased), (iii) any claim for personal injury or property damage in connection
with any Borrower or any Subsidiary or otherwise occurring on or with respect
to
its Property (whether owned or leased), and (iv) the inaccuracy or breach of
any
environmental representation, warranty or covenant by any Borrower or any
Subsidiary made herein or in any other Loan Document evidencing or securing
any
Obligations or setting forth terms and conditions applicable thereto or
otherwise relating thereto, except for damages arising from the willful
misconduct or gross negligence of the relevant Indemnitee. This
indemnification shall survive the payment and satisfaction of all Obligations
and the termination of this Agreement, and shall remain in force beyond the
expiration of any applicable statute of limitations and payment or satisfaction
in full of any single claim under this indemnification. This
indemnification shall be binding upon the successors and assigns of the
Borrowers and shall inure to the benefit of each Indemnitee and its successors
and assigns.
Section 13.16. Set-off. In
addition to any rights now or hereafter granted under the Loan Documents or
applicable law and not by way of limitation of any such rights, upon the
occurrence of any Event of Default, each Lender, the L/C Issuer, each
subsequent holder of any Obligation, and each of their respective affiliates,
is
hereby authorized by each Borrower and each Guarantor at any time or from time
to time, without notice to any Borrower, any Guarantor 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, and in whatever currency denominated, but not including trust
accounts) and any other indebtedness at any time held or owing by that Lender,
L/C Issuer, subsequent holder, or affiliate, to or for the credit or the
account of such Borrower or such Guarantor, whether or not matured, against
and
on account of the Obligations of such Borrower or such Guarantor to that Lender,
L/C Issuer, or subsequent holder under the Loan Documents, including, but
not limited to, all claims of any nature or description arising out of or
connected with the Loan Documents, irrespective of whether or not (a) that
Lender, L/C Issuer, or subsequent holder shall have made any demand
hereunder or (b) the principal of or the interest on the Loans and other
amounts due hereunder shall have become due and payable pursuant to
Section 9 and although said obligations and liabilities, or any of them,
may be contingent or unmatured.
Section 13.17. Entire
Agreement. The Loan Documents constitute the entire
understanding of the parties thereto with respect to the subject matter thereof
and any prior agreements, whether written or oral, with respect thereto are
superseded hereby.
Section 13.18. Governing
Law. This Agreement and the other Loan Documents, and the
rights and duties of the parties hereto, shall be construed and determined
in
accordance with the internal laws of the State of Illinois; provided, however, that
nothing herein or in any other LoanDocument shall prevent
any Credit Party from contesting or raising defenses to any confession of
judgment obtained pursuant to 735 ILCS 5/2-1301(c).
78
Section 13.19. Severability
of Provisions. Any provision of any Loan Document which is
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction. All rights, remedies and powers provided
in this Agreement and the other Loan Documents may be exercised only to the
extent that the exercise thereof does not violate any applicable mandatory
provisions of law, and all the provisions of this Agreement and other Loan
Documents are intended to be subject to all applicable mandatory provisions
of
law which may be controlling and to be limited to the extent necessary so that
they will not render this Agreement or the other Loan Documents invalid or
unenforceable.
Section 13.20. Excess
Interest. Notwithstanding any provision to the contrary
contained herein or in any other Loan Document, no such provision shall require
the payment or permit the collection of any amount of interest in excess of
the
maximum amount of interest permitted by applicable law to be charged for the
use
or detention, or the forbearance in the collection, of all or any portion of
the
Loans or other obligations outstanding under this Agreement or any other Loan
Document (“Excess
Interest”). If any Excess Interest is provided for, or is
adjudicated to be provided for, herein or in any other Loan Document, then
in
such event (a) the provisions of this Section shall govern and control,
(b) neither any Borrower nor any Guarantor or endorser shall be obligated
to pay any Excess Interest, (c) any Excess Interest that the Administrative
Agent or any Lender may have received hereunder shall, at the option of the
Administrative Agent, be (i) applied as a credit against the then
outstanding principal amount of Obligations hereunder and accrued and unpaid
interest thereon (not to exceed the maximum amount permitted by applicable
law),
(ii) refunded to the Company, on behalf of the Borrowers, or (iii) any
combination of the foregoing, (d) the interest rate payable hereunder or
under any other Loan Document shall be automatically subject to reduction to
the
maximum lawful contract rate allowed under applicable usury laws (the “Maximum Rate”), and this
Agreement and the other Loan Documents shall be deemed to have been, and shall
be, reformed and modified to reflect such reduction in the relevant interest
rate, and (e) neither any Borrower nor any Guarantor or endorser shall have
any action against the Administrative Agent or any Lender for any damages
whatsoever arising out of the payment or collection of any Excess
Interest. Notwithstanding the foregoing, if for any period of time
interest on any of Borrowers’ Obligations is calculated at the Maximum Rate
rather than the applicable rate under this Agreement, and thereafter such
applicable rate becomes less than the Maximum Rate, the rate of interest payable
on the Borrowers’ Obligations shall remain at the Maximum Rate until the Lenders
have received the amount of interest which such Lenders would have received
during such period on the Borrowers’ Obligations had the rate of interest not
been limited to the Maximum Rate during such period.
Section 13.21. Construction. The
parties acknowledge and agree that the Loan Documents shall not be construed
more favorably in favor of any party hereto based upon which party drafted
the
same, it being acknowledged that all parties hereto contributed substantially
to
the negotiation of the Loan Documents. Nothing contained herein shall be deemed
or
construed to permit any act or omission which is prohibited by the terms of
any
Collateral
Document, the covenants and agreements contained herein being in addition to
and
not in substitution for the covenants and agreements contained in the Collateral
Documents.
79
Section 13.22. Lender’s
and L/C Issuer’s Obligations Several; Lenders and their
Affiliates. The obligations of the Lenders and L/C Issuer
hereunder are several and not joint. Nothing contained in this
Agreement and no action taken by the Lenders or L/C Issuer pursuant hereto
shall
be deemed to constitute the Lenders and L/C Issuer a partnership, association,
joint venture or other entity. Each Lender, L/C Issuer and its
Affiliates may accept deposits from, lend money to, and generally engage in
any
kind of business with any Borrower or any Affiliate of any Borrower as if it
were not a Lender hereunder; provided, however, that the
foregoing shall not be deemed to permit any Credit Party to do that which is
otherwise prohibited by the Loan Documents.
Section 13.23. Intentionally
Omitted. Intentionally
Omitted.
Section 13.24. Submission
to Jurisdiction; Waiver of Jury Trial. The Borrowers and the
Guarantors hereby submit to the nonexclusive jurisdiction of the United States
District Court for the Northern District of Illinois and of any Illinois State
court sitting in the City of Chicago for purposes of all legal proceedings
arising out of or relating to this Agreement, the other Loan Documents or the
transactions contemplated hereby or thereby. The Borrowers and the
Guarantors irrevocably waive, to the fullest extent permitted by law, any
objection which they may now or hereafter have to the laying of the venue of
any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient
forum. The Borrowers, the Guarantors, the Administrative Agent, the
L/C Issuer and the Lenders hereby irrevocably waive any and all right to trial
by jury in any legal proceeding arising out of or relating to any Loan Document
or the transactions contemplated thereby.
Section 13.25. USA
Patriot Act. Each Lender and L/C Issuer that is subject
to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed
into law October 26, 2001)) (the “Act”) hereby notifies
the
Borrowers that pursuant to the requirements of the Act, it is required to
obtain, verify, and record information that identifies the Borrowers, which
information includes the name and address of the Borrowers and other information
that will allow such Lender or L/C Issuer to identify the Borrowers in
accordance with the Act.
Section
13.26. Confidentiality. Each of the
Administrative Agent, the Lenders, and the L/C Issuer severally agrees to
maintain the confidentiality of the Information (as defined below), except
that
Information may be disclosed (a) to its and its Affiliates’ directors,
officers, employees and agents, including accountants, legal counsel and other
advisors to the extent any such Person has a need to know such Information
(it
being understood that the Persons to whom such disclosure is made will first
be
informed of the confidential nature of such Information and instructed to keep
such Information confidential), (b) to the extent requested by any
regulatory authority (including any self-regulatory authority, such as the
National Association of Insurance Commissioners), (c) to the extent
required by applicable laws or regulations or by any subpoena or similar legal
process, (d) to any other party hereto, (e) in connection with the
exercise of any remedies hereunder or under any other Loan Document or any
suit,
action or proceeding relatingto this Agreement or any other
Loan Document or the enforcement of rights hereunder or thereunder,
(f) subject to an agreement containing provisions substantially the same as
those of this Section, to (A) any assignee of or participant in, or any
prospective assignee of or participant in, any of its rights or obligations
under this Agreement or (B) any actual or prospective counterparty (or its
advisors) to any swap or derivative transaction relating to any Borrower or
any
Subsidiary and its obligations, (g) with the prior written consent of the
Company, on behalf of the Borrowers, (h) to the extent such Information
(A) becomes publicly available other than as a result of a breach of this
Section or (B) becomes available to the Administrative Agent, any Lender or
the L/C Issuer on a non-confidential basis from a source other than any
Borrower or any Subsidiary or any of their directors, officers, employees or
agents, including accountants, legal counsel and other advisors, (i) to rating
agencies if requested or required by such agencies in connection with a rating
relating to the Loans or Commitments hereunder, or (j) to entities which compile
and publish information about the syndicated loan market, provided that only basic
information about the pricing and structure of the transaction evidenced hereby
may be disclosed pursuant to this subsection (j). For purposes of this
Section, “Information”
means all information received from any Borrower or any of the Subsidiaries
or
from any other Person on behalf of any Borrower or any Subsidiary relating
to
any Borrower or any Subsidiary or any of their respective businesses, other
than
any such information that is available to the Administrative Agent, any Lender
or the L/C Issuer on a non-confidential basis prior to disclosure by any
Borrower or any of the Subsidiaries or from any other Person on behalf of any
Borrower or any of the Subsidiaries.
[Signature
Pages to Follow]
80
This
Agreement is entered into between us for the uses and purposes hereinabove
set
forth as of the date first above written.
“Borrowers”
RC2
Corporation
Learning
Curve Brands, Inc.
Learning
Curve Canada Limited
RC2
(Australia) Pty., Ltd.
RC2
Deutschland GmbH
Racing
Champions International Limited
Racing
Champions Worldwide Limited
By /s/
Xxxx Xxxxxxxxx
Name Xxxx
Xxxxxxxxx
Title CEO
RC2
(Asia) Limited
By /s/
Lo Siu Fun Helena
Name Lo
Siu Fun
Helena
Title Director
“Guarantors”
RCE
Holdings, LLC
Learning
Curve International, Inc.
Xxxxxxxxxxxxxxxxx.xxx,
Inc.
Learning
Curve Canada Holdco, Inc.
By /s/
Xxxx
Xxxxxxxxx
Name Xxxx
Xxxxxxxxx
Title CEO
S-1
“Lenders”
|
Bank
of Montreal, in its individual capacity
as an L/C Issuer and as Administrative Agent
|
By /s/
Xxxx X. Xxxxxx III
Name Xxxx
X. Xxxxxx III
Title Vice
President
Xxxxxx
X.X., as an L/C Issuer
By /s/
Xxxx X. Xxxxxx III
Name Xxxx
X. Xxxxxx
III
Title Vice
President
S-2
BMO
Capital Markets Financing, Inc., as a
Lender and Swing Line Lender
By /s/
Xxxx X. Xxxxxx III
Name Xxxx
X. Xxxxxx
III
Title Vice
President
S-3
National
City Bank, as a Lender
By /s/
Xxxxxxxxx Xxxxx
Name Xxxxxxxxx
Xxxxx
Title Senior
Vice President
S-4
U.S.
Bank
National Association, as a Lender
By /s/
Xxxxx Xxxxxx
Name Xxxxx
Xxxxxx
Title Senior
Vice President
S-5
Fifth
Third Bank (Chicago), A MICHIGAN
BANKING
CORPORATION, as a Lender
By /s/
Xxx Xxxxxxxxxxx
Name Xxx
Xxxxxxxxxxx
Title Vice
President
S-6
The
Northern Trust Company, as a Lender
By /s/
Xxxxxxx Xxxxx
Name Xxxxxxx
Xxxxx
Title Senior
Vice President
S-7
The
PrivateBank and Trust Company, as a Lender
By /s/
Xxxxxxx X. Xxxxx
Name Xxxxxxx
X.
Xxxxx
Title Associate
Managing
Director
S-8