1
EXHIBIT (b)
AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
DATED as of December 8, 1997
among
HADCO CORPORATION
and
BANKBOSTON, N.A.,
Individually and as Agent,
and
THE OTHER LENDING INSTITUTIONS
LISTED ON SCHEDULE 1 HERETO
with
BANCBOSTON SECURITIES INC.,
as Arranger
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TABLE OF CONTENTS
1. DEFINITIONS AND RULES OF INTERPRETATION.......................................1
1.1. Definitions...........................................................1
1.2. Rules of Interpretation...............................................13
2. THE REVOLVING CREDIT FACILITY. ..............................................14
2.1. Commitment to Lend....................................................14
2.2. Commitment Fee........................................................14
2.3. Reduction of Total Commitment.........................................15
2.4. The Notes.............................................................15
2.5. Interest on Loans.....................................................16
2.6. Requests for Loans....................................................16
2.7. Conversion Options....................................................16
2.1.1. Conversion to Different Type of Loan.........................17
2.7.2. Continuation of Type of Loan.................................17
2.7.3. Eurodollar Rate Loans........................................17
2.8. Funds for Loans.......................................................18
2.8.1. Funding Procedures...........................................18
2.8.2. Advances by Agent............................................18
3. REPAYMENT OF THE REVOLVING CREDIT LOANS.......................................19
3.1. Maturity..............................................................19
3.2. Mandatory Repayments of Loans.........................................19
3.3. Optional Repayments of Loans..........................................19
4. LETTERS OF CREDIT.............................................................20
4.1. Letter of Credit Commitments..........................................20
4.1.1. Commitment to Issue Letters of Credit........................20
4.1.2. Letter of Credit Applications................................20
4.1.3. Terms of Letters of Credit...................................20
4.1.4. Reimbursement Obligations of Banks...........................21
4.1.5. Participations of Banks......................................21
4.2. Reimbursement Obligation of the Borrower..............................21
4.3. Letter of Credit Payments.............................................22
4.4. Obligations Absolute..................................................22
4.5. Reliance by Issuer....................................................23
4.6. Letter of Credit Fee..................................................23
5. CERTAIN GENERAL PROVISIONS....................................................24
5.1. Fees..................................................................24
5.2. Funds for Payments....................................................24
5.2.1. Payments to Agent............................................24
5.2.2. No Offset, etc...............................................24
5.3. Computations..........................................................25
5.4. Inability to Determine Eurodollar Rate................................25
5.5. Illegality............................................................25
5.6. Additional Costs, etc.................................................26
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5.7. Capital Adequacy.....................................................27
5.8. Certificate..........................................................27
5.9. Indemnity............................................................27
5.10. Interest After Default...............................................28
5.10.1. Overdue Amounts.............................................28
5.10.2. Amounts Not Overdue.........................................28
6. GUARANTIES....................................................................28
7. REPRESENTATIONS AND WARRANTIES................................................28
7.1. Corporate Authority..................................................28
7.1.1. Incorporation; Good Standing................................28
7.1.2. Authorization...............................................29
7.1.3. Enforceability..............................................29
7.2. Governmental Approvals...............................................29
7.3. Title to Properties; Leases. .......................................29
7.4. Financial Statements, Projections and Solvency.......................30
7.4.1. Financial Statements........................................30
7.4.2. Projections.................................................30
7.4.3. Solvency....................................................30
7.5. No Material Changes, etc.............................................31
7.6. Franchises, Patents, Copyrights, etc.................................31
7.7. Litigation...........................................................31
7.8. No Materially Adverse Contracts, etc.................................31
7.9. Compliance with Other Instruments, Laws, etc.........................32
7.10. Tax Status...........................................................32
7.11. No Event of Default..................................................32
7.12. Holding Company and Investment Company Acts..........................32
7.13. Absence of Financing Statements. ...................................32
7.14. Certain Transactions.................................................32
7.15. Employee Benefit Plans...............................................33
7.15.1. In General..................................................33
7.15.2. Terminability of Welfare Plans..............................33
7.15.3. Guaranteed Pension Plans....................................33
7.15.4. Multiemployer Plans.........................................34
7.16. Use of Proceeds......................................................34
7.17. Environmental Compliance.............................................34
7.18. Subsidiaries, etc. ..................................................36
7.19. Disclosure. ........................................................36
8. AFFIRMATIVE COVENANTS OF THE BORROWER.........................................36
8.1. Punctual Payment.....................................................36
8.2. Maintenance of Office................................................37
8.3. Records and Accounts.................................................37
8.4. Financial Statements, Certificates and Information...................37
8.5. Notices..............................................................38
8.5.1. Defaults....................................................38
8.5.2. Environmental Events........................................39
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8.5.3. Notice of Litigation and Judgments..........................39
8.6. Corporate Existence; Maintenance of Properties.......................39
8.7. Insurance............................................................40
8.8. Taxes................................................................40
8.9. Inspection of Properties and Books, etc..............................40
8.9.1. General.....................................................40
8.9.2. Communications with Accountants.............................41
8.10. Compliance with Laws, Contracts, Licenses, and Permits...............41
8.11. Employee Benefit Plans...............................................41
8.12. Use of Proceeds......................................................41
8.12.1. General.....................................................41
8.12.2. Regulations U and X.........................................42
8.12.3. Ineligible Securities. ....................................42
8.13. Interest Rate Protection Agreements..................................42
8.14. Further Assurances...................................................42
9. CERTAIN NEGATIVE COVENANTS OF THE BORROWER....................................43
9.1. Restrictions on Indebtedness.........................................43
9.2. Restrictions on Liens................................................46
9.3. Restrictions on Investments..........................................47
9.4. Distributions........................................................48
9.5. Mergers and Consolidations, Acquisitions and Disposition of Assets...48
9.5.1. Mergers and Consolidations..................................48
9.5.2. Acquisitions................................................48
9.5.3. Disposition of Assets.......................................50
9.6. Sale and Leaseback...................................................50
9.7. Compliance with Environmental Laws...................................50
9.8. Employee Benefit Plans...............................................50
9.9. Capitalization.......................................................51
9.10. Agreements Regarding Hadco FSC and New Zycon.........................51
10. FINANCIAL COVENANTS OF THE BORROWER...........................................52
10.1. Funded Debt to EBITDA................................................52
10.2. Debt Service.........................................................52
10.3. Consolidated Net Worth...............................................52
10.4. Fixed Charge Coverage Ratio..........................................52
11. CLOSING CONDITIONS............................................................53
11.1. Loan Documents.......................................................53
11.2. Certified Copies of Charter Documents................................53
11.3. Corporate Action.....................................................53
11.4. Incumbency Certificate...............................................53
11.5. UCC Search Results...................................................53
11.6. Certificates of Insurance............................................53
11.7. Solvency Certificate.................................................54
11.8. Opinion of Counsel...................................................54
11.9. Payment of Fees......................................................54
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11.10. Pay-Off Letters, Etc.................................................54
12. CONDITIONS TO ALL BORROWINGS. ...............................................54
12.1. Representations True; No Event of Default............................54
12.2. No Legal Impediment..................................................55
12.3. Governmental Regulation..............................................55
12.4. Proceedings and Documents............................................55
13. EVENTS OF DEFAULT; ACCELERATION; ETC..........................................55
13.1. Events of Default and Acceleration...................................55
13.2. Termination of Commitments...........................................58
13.3. Remedies.............................................................59
14. SETOFF........................................................................59
15. THE AGENT.....................................................................60
15.1. Authorization........................................................60
15.2. Employees and Agents.................................................60
15.3. No Liability.........................................................61
15.4. No Representations...................................................61
15.5. Payments.............................................................61
15.5.1. Payments to Agent...........................................61
15.5.2. Distribution by Agent.......................................61
15.5.3. Delinquent Banks............................................62
15.6. Holders of Notes.....................................................62
15.7. Indemnity............................................................62
15.8. Agent as Bank........................................................63
15.9. Resignation..........................................................63
16. EXPENSES......................................................................63
17. INDEMNIFICATION...............................................................64
18. SURVIVAL OF COVENANTS, ETC....................................................65
19. ASSIGNMENT AND PARTICIPATION..................................................65
19.1. Conditions to Assignment by Banks....................................65
19.2. Certain Representations and Warranties; Limitations; Covenants.......66
19.3. Register.............................................................67
19.4. New Notes............................................................67
19.5. Participations.......................................................68
19.6. Disclosure...........................................................68
19.7. Assignee or Participant Affiliated with the Borrower.................68
19.8. Miscellaneous Assignment Provisions..................................69
19.9. Assignment by Borrower...............................................69
20. NOTICES, ETC..................................................................69
21. GOVERNING LAW.................................................................70
22. HEADINGS......................................................................70
23. COUNTERPARTS..................................................................70
24. ENTIRE AGREEMENT, ETC.........................................................71
25. WAIVER OF JURY TRIAL..........................................................71
26. CONSENTS, AMENDMENTS, WAIVERS, ETC............................................71
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27. SEVERABILITY..................................................................72
28. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.................................72
28.1. Sharing of Information with Section 20 Subsidiary....................72
28.2. Confidentiality......................................................72
28.3. Prior Notification...................................................73
28.4. Other................................................................73
29. TRANSITIONAL ARRANGEMENTS.....................................................74
29.1. Prior Credit Agreement Superseded....................................74
29.2. Return and Cancellation of Notes.....................................74
29.3. Fees Under Superseded Agreement......................................74
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EXHIBITS
EXHIBIT A - Note
EXHIBIT B - Loan Request
EXHIBIT C - Compliance Certificate
EXHIBIT D - Assignment and Acceptance
EXHIBIT E - Guaranty
SCHEDULES
SCHEDULE 1 - Banks; Commitments
SCHEDULE 7.3 - Title to Properties; Leases
SCHEDULE 7.5 - Contracts
SCHEDULE 7.7 - Litigation
SCHEDULE 7.10 - Tax Status
SCHEDULE 7.17 - Environmental Matters
SCHEDULE 7.18 - Subsidiaries
SCHEDULE 9.1 - Indebtedness
SCHEDULE 9.2 - Liens
SCHEDULE 9.3 - Investments
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AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
This AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT is made as of
December 8, 1997 by and among HADCO CORPORATION (the "Borrower"), a
Massachusetts corporation having its principal place of business at 00X Xxxxx
Xxxxxxx, Xxxxx, Xxx Xxxxxxxxx 00000, and BANKBOSTON, N.A., formerly known as THE
FIRST NATIONAL BANK OF BOSTON, a national banking association and the other
lending institutions listed on SCHEDULE 1 hereto, and BANKBOSTON, N.A., formerly
known as THE FIRST NATIONAL BANK OF BOSTON, as agent for itself and such other
lending institutions.
The Borrower, the Agent and certain of the Banks are parties to a
Revolving Credit Agreement dated as of January 8, 1997, as amended by the First
Amendment and Modification Agreement dated as of February 21, 1997 (as so
amended, the "Original Credit Agreement"). The Borrower, the Agent and the Banks
desire further to amend in various respects and restate the Original Credit
Agreement in order among other things, to increase the size of the Total
Commitment and add certain additional lending institutions as "Banks" for
purposes hereof. Accordingly, the parties hereto hereby agree to amend and
restate the Original Revolving Credit Agreement as follows:
1. DEFINITIONS AND RULES OF INTERPRETATION.
1.1. DEFINITIONS. The following terms shall have the meanings set forth
in this ss.1 or elsewhere in the provisions of this Credit Agreement referred to
below:
AFFILIATE. Any Person that would be considered to be an affiliate of
the Borrower under Rule 144(a) of the Rules and Regulations of the Securities
and Exchange Commission, as in effect on the date hereof, if the Borrower were
issuing securities.
AGENT. BankBoston, N.A., acting as agent for the Banks.
AGENT'S HEAD OFFICE. The Agent's head office located at 000 Xxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or at such other location as the Agent may
designate from time to time.
AGENT'S SIDE LETTER. See ss.5.1.
AGENT'S SPECIAL COUNSEL. Xxxxxxx Xxxx LLP or such other counsel as may
be approved by the Agent.
APPLICABLE COMMITMENT FEE PERCENTAGE. For any fiscal quarter or portion
thereof, three-eighths of one percent (0.375%) per annum; PROVIDED, HOWEVER,
that in the event that the ratio of Funded Debt (calculated as of the last day
of such fiscal quarter or portion thereof) to EBITDA (calculated for the four
consecutive fiscal quarters ending on the last day of such fiscal quarter or
portion thereof) meets the requirements set forth in the chart below, the
Applicable Commitment Fee Percentage shall, commencing with the date which is
ten (10) days after any date on which the Borrower delivers to the Banks the
financial statements referred to in ss.8.4(a) or (b) for such fiscal quarter or
portion thereof and ending with the date nine (9) days after the next date on
which the Borrower delivers to each of the
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Banks the financial statements referred to in ss.8.4(a) or (b), be the
percentage set forth opposite the applicable ratio of Funded Debt to EBITDA in
the table below:
Ratio of Funded Debt
to EBITDA Applicable Commitment Fee Percentage
-------------------- ------------------------------------
Greater than or equal to 2.5:1.0 0.375%
Greater than or equal to 2.0:1.0 0.275%
but less than 2.5:1.0
Greater than or equal to 1.5:1.0 0.225%
but less than 2.0:1.0
Less than 1.5:1.0 0.200%
APPLICABLE EURODOLLAR RATE MARGIN. For any fiscal quarter or portion
thereof within any Interest Period with respect to any Eurodollar Rate Loan, one
and three-eighths percent (1.375%) per annum; PROVIDED, HOWEVER, that in the
event that the ratio of Funded Debt (calculated as of the last day of such
fiscal quarter or portion thereof) to EBITDA (calculated for the four
consecutive fiscal quarters ending on the last day of such fiscal quarter or
portion thereof) meets the requirements set forth in the chart below, the
Applicable Eurodollar Rate Margin shall, commencing with (but not before) the
date which is ten (10) days after the date on which the Borrower delivers to the
Banks the financial statements referred to in ss.8.4(a) or (b) for such fiscal
quarter or portion thereof and ending with the date which is nine (9) days after
the next date on which the Borrower delivers to each of the Banks the financial
statements referred to in ss.8.4(a) or (b), be the percentage set forth opposite
the applicable ratio of Funded Debt to EBITDA in the table below:
Ratio of Funded Debt Applicable Eurodollar
to EBITDA Rate Margin
-------------------- ---------------------
Greater than or equal to 3.0:1.0 1.375%
Greater than or equal to 2.5:1.0 1.125%
but less than 3.0:1.0
Greater than or equal to 2.0:1.0 0.875%
but less than 2.5:1.0
Greater than or equal to 1.5:1.0 0.625%
but less than 2.0:1.0
Less than 1.5:1.0 0.500%
ASSIGNMENT AND ACCEPTANCE. See ss.19.1.
BALANCE SHEET DATE. October 26, 1996.
BANK BUMIPUTRA LOAN AGREEMENT. The Loan Agreement dated as of
February 9, 1996 among Hadco Malaysia, formerly known as Zycon Corporation SDN
BHD, Bank Bumiputra and certain other lenders, as in effect on January 8, 1997.
BANKS. BKB and the other lending institutions listed on SCHEDULE 1
hereto and any other Person who becomes an assignee of any rights and
obligations of a Bank pursuant to ss.19.
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BASE RATE. The higher of (i) the annual rate of interest announced from
time to time by BKB at its head office in Boston, Massachusetts, as its "base
rate" and (ii) one-half of one percent (1/2%) above the Federal Funds Effective
Rate. For the purposes of this definition, "Federal Funds Effective Rate" shall
mean for any day, the rate per annum equal to the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day that
is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three funds brokers of recognized
standing selected by the Agent.
BASE RATE LOANS. Loans bearing interest calculated by reference to the
Base Rate.
BKB. BankBoston, N.A., a national banking association, in its
individual capacity.
BORROWER. As defined in the preamble hereto.
BUSINESS DAY. Any day on which banking institutions in Boston,
Massachusetts, are open for the transaction of banking business and, in the case
of Eurodollar Rate Loans, also a day which is a Eurodollar Business Day.
CAPITAL ASSETS. Fixed assets, both tangible (such as land, buildings,
fixtures, machinery and equipment) and intangible (such as patents, copyrights,
trademarks, franchises and good will); PROVIDED that Capital Assets shall not
include any item customarily charged directly to expense or depreciated over a
useful life of twelve (12) months or less in accordance with generally accepted
accounting principles.
CAPITAL EXPENDITURES. Amounts paid or indebtedness incurred by any of
the Transaction Parties in connection with the purchase or lease by any of the
Transaction Parties of Capital Assets that would be required to be capitalized
and shown on the balance sheet of such Person in accordance with generally
accepted accounting principles.
CAPITALIZED LEASES. Leases under which any of the Transaction Parties
is the lessee or obligor, the discounted future rental payment obligations under
which are required to be capitalized on the balance sheet of the lessee or
obligor in accordance with generally accepted accounting principles.
CERCLA. See ss.7.17.
CLOSING DATE. The first date on which the conditions set forth in ss.11
have been satisfied and any Loans are to be made or any Letter of Credit is to
be issued hereunder.
CODE. The Internal Revenue Code of 1986, as amended and in effect from
time to time.
COMMITMENT. With respect to each Bank, the amount set forth on SCHEDULE
1 hereto as the amount of such Bank's commitment to make Loans to, and to
participate in the issuance, extension and renewal of Letters of Credit for the
account of, the Borrower, as the same may be reduced from time to time; or if
such commitment is terminated pursuant to the provisions hereof, zero.
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COMMITMENT PERCENTAGE. With respect to each Bank, the percentage set
forth on SCHEDULE 1 hereto as such Bank's percentage of the aggregate
Commitments of all of the Banks.
CONSOLIDATED OR CONSOLIDATED. With reference to any term defined
herein, shall mean that term as applied to the accounts of the Transaction
Parties, consolidated in accordance with generally accepted accounting
principles.
CONSOLIDATED FUNDED DEBT. At any time of determination, the sum of (i)
the amount of the Loans outstanding (after giving account to any amounts
requested) PLUS accrued but unpaid interest thereon; PLUS (ii) the Maximum
Drawing Amount and all Unpaid Reimbursement Obligations PLUS accrued but unpaid
interest (if any) thereon; PLUS (iii) the outstanding amount of any other
Indebtedness for borrowed money, in respect of Capitalized Leases or which is
otherwise subject to the payment of interest PLUS accrued but unpaid interest on
such Indebtedness, whether such interest was or is required to be reflected as
an item of expense or capitalized, including payments consisting of interest in
respect of Capitalized Leases and including commitment fees, agency fees,
facility fees, balance deficiency fees and similar fees or expenses in
connection with the borrowing of money.
CONSOLIDATED NET INCOME (OR DEFICIT). The consolidated net income (or
deficit) of the Transaction Parties, after deduction of all expenses, taxes, and
other proper charges, determined in accordance with generally accepted
accounting principles, after eliminating therefrom all extraordinary
nonrecurring items of income, the Zycon Acquisition Related Write-Off and
Non-Cash Acquisition Expenses.
CONSOLIDATED NET WORTH. The excess of Consolidated Total Assets over
Consolidated Total Liabilities.
CONSOLIDATED TANGIBLE NET WORTH. The excess of Consolidated Total
Assets over Consolidated Total Liabilities, and less the sum of:
(a) the total book value of all assets of the Transaction
Parties properly classified as intangible assets under generally
accepted accounting principles, including such items as good will, the
purchase price of acquired assets in excess of the fair market value
thereof, trademarks, trade names, service marks, brand names,
copyrights, patents and licenses, and rights with respect to the
foregoing; PLUS
(b) all amounts representing any write-up in the book value of
any assets of the Transaction Parties resulting from a revaluation
thereof subsequent to the Balance Sheet Date, excluding adjustments to
translate foreign assets and liabilities for changes in foreign
exchange rates made in accordance with Financial Accounting Standards
Board Statement No. 52; PLUS
(c) to the extent otherwise includable in the computation of
Consolidated Tangible Net Worth, any subscriptions receivable.
CONSOLIDATED TOTAL ASSETS. All assets of the Transaction Parties
determined on a consolidated basis in accordance with generally accepted
accounting principles.
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CONSOLIDATED TOTAL INTEREST EXPENSE. For any period, the aggregate
amount of interest required to be paid or accrued by the Transaction Parties
during such period on all Indebtedness of the Transaction Parties outstanding
during all or any part of such period, whether such interest was or is required
to be reflected as an item of expense or capitalized, including payments
consisting of interest in respect of Capitalized Leases and including commitment
fees, agency fees, facility fees, balance deficiency fees and similar fees or
expenses in connection with the borrowing of money.
CONSOLIDATED TOTAL LIABILITIES. All liabilities of the Transaction
Parties determined on a consolidated basis in accordance with generally accepted
accounting principles and all Indebtedness of the Transaction Parties, whether
or not so classified.
CONVERSION REQUEST. A notice given by the Borrower to the Agent of the
Borrower's election to convert or continue a Loan in accordance with ss.2.7.
CREDIT AGREEMENT. This Amended and Restated Revolving Credit Agreement,
including the Schedules and Exhibits hereto.
DEFAULT. See ss.13.1.
DISTRIBUTION. The declaration or payment of any dividend on or in
respect of any shares of any class of capital stock of the Borrower, other than
dividends payable solely in shares of common stock of the Borrower; the
purchase, redemption, or other retirement of any shares of any class of capital
stock, or any rights or options convertible into shares of any class of capital
stock (and including any purchase, redemption, prepayment or other retirement,
in whole or in part, of any subordinated indebtedness permitted by ss.9.1(k)),
of the Borrower, directly or indirectly through a Subsidiary of the Borrower, or
otherwise; the return of capital by the Borrower to its shareholders as such; or
any other distribution on or in respect of any shares of any class of capital
stock of the Borrower.
DOLLARS or $. Dollars in lawful currency of the United States of
America.
DOMESTIC LENDING OFFICE. Initially, the office of each Bank designated
as such in SCHEDULE 1 hereto; thereafter, such other office of such Bank, if
any, located within the United States that will be making or maintaining Base
Rate Loans.
DRAWDOWN DATE. The date on which any Loan is made or is to be made, and
the date on which any Loan is converted or continued in accordance with ss.2.7.
EARNINGS BEFORE INTEREST AND TAXES or EBIT. The consolidated earnings
(or loss) from the operations of the Transaction Parties for any period, after
all expenses and other proper charges but before payment or provision for any
income taxes or interest expense, for such period, determined in accordance with
generally accepted accounting principles, after eliminating therefrom all
extraordinary nonrecurring items of income or loss, earnings from discontinued
businesses, any non-cash gains used in determining income, the Zycon Acquisition
Related Write-Off, and any Non-Cash Acquisition Expenses.
EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION or
EBITDA. The consolidated earnings (or loss) from the operations of the
Transaction Parties for any
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period, after all expenses and other proper charges but before payment or
provision for any income taxes, interest expense, depreciation or amortization
for such period, determined in accordance with generally accepted accounting
principles, after eliminating therefrom all extraordinary nonrecurring items of
income or loss, earnings from discontinued businesses, any non-cash gains used
in determining income, the Zycon Acquisition Related Write-Off, and any Non-Cash
Acquisition Expenses.
ELIGIBLE ASSIGNEE. Any of (i) a commercial bank or finance company
organized under the laws of the United States, or any State thereof or the
District of Columbia, and having total assets in excess of $1,000,000,000; (ii)
a savings and loan association or savings bank organized under the laws of the
United States, or any State thereof or the District of Columbia, and having a
net worth of at least $100,000,000, calculated in accordance with generally
accepted accounting principles; (iii) a commercial bank organized under the laws
of any other country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political subdivision of any such
country, and having total assets in excess of $1,000,000,000, PROVIDED that such
bank is acting through a branch or agency located in the country in which it is
organized or another country which is also a member of the OECD; (iv) the
central bank of any country which is a member of the OECD; and (v) if, but only
if, any Event of Default has occurred and is continuing, any other bank,
insurance company, commercial finance company or other financial institution or
other Person approved by the Agent, such approval not to be unreasonably
withheld.
EMPLOYEE BENEFIT PLAN. Any employee benefit plan within the meaning of
ss.3(3) of ERISA maintained or contributed to by the Borrower, other than a
Guaranteed Pension Plan or a Multiemployer Plan.
ENVIRONMENTAL LAWS. See ss.7.17(a).
ERISA. The Employee Retirement Income Security Act of 1974, as amended
and in effect from time to time.
ERISA AFFILIATE. Any Person which is treated as a single employer with
the Borrower under ss.414 of the Code.
ERISA REPORTABLE EVENT. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of ss.4043 of ERISA and the regulations
promulgated thereunder.
EUROCURRENCY RESERVE RATE. For any day with respect to a Eurodollar
Rate Loan, the maximum rate (expressed as a decimal) at which any lender subject
thereto would be required to maintain reserves under Regulation D of the Board
of Governors of the Federal Reserve System (or any successor or similar
regulations relating to such reserve requirements) against "Eurocurrency
Liabilities" (as that term is used in Regulation D), if such liabilities were
outstanding. The Eurocurrency Reserve Rate shall be adjusted automatically on
and as of the effective date of any change in the Eurocurrency Reserve Rate.
EURODOLLAR BUSINESS DAY. Any day on which commercial banks are open for
international business (including dealings in Dollar deposits) in London or such
other
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eurodollar interbank market as may be selected by the Agent in its sole
discretion acting in good faith.
EURODOLLAR LENDING OFFICE. Initially, the office of each Bank
designated as such in SCHEDULE 1 hereto; thereafter, such other office of such
Bank, if any, that shall be making or maintaining Eurodollar Rate Loans.
EURODOLLAR RATE. For any Interest Period with respect to a Eurodollar
Rate Loan, the rate of interest equal to (i) the arithmetic average of the rates
per annum (rounded upwards to the nearest 1/16 of one percent) of the rate at
which BKB's Eurodollar Lending Office is offered Dollar deposits two Eurodollar
Business Days prior to the beginning of such Interest Period in the interbank
eurodollar market where the eurodollar and foreign currency and exchange
operations of such Eurodollar Lending Office are customarily conducted, for
delivery on the first day of such Interest Period for the number of days
comprised therein and in an amount comparable to the amount of the Eurodollar
Rate Loan of BKB to which such Interest Period applies, divided by (ii) a number
equal to 1.00 minus the Eurocurrency Reserve Rate, if applicable.
EURODOLLAR RATE LOANS. Loans bearing interest calculated by reference
to the Eurodollar Rate.
EVENT OF DEFAULT. See ss.13.1.
EXITING BANKS. Each of the Banks (as defined in the Original Credit
Agreement) which are not continuing as Banks under and for purposes of this
Credit Agreement and the other Loan Documents.
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. (i) When used in ss.10,
whether directly or indirectly through reference to a capitalized term used
therein, means (A) principles that are consistent with the principles
promulgated or adopted by the Financial Accounting Standards Board and its
predecessors, in effect for the fiscal year ended on the Balance Sheet Date, and
(B) to the extent consistent with such principles, the accounting practice of
the Borrower reflected in its financial statements for the year ended on the
Balance Sheet Date, and (ii) when used in general, other than as provided above,
means principles that are (A) consistent with the principles promulgated or
adopted by the Financial Accounting Standards Board and its predecessors, as in
effect from time to time, and (B) consistently applied with past financial
statements of the Borrower adopting the same principles, provided that in each
case referred to in this definition of "generally accepted accounting
principles" a certified public accountant would, insofar as the use of such
accounting principles is pertinent, be in a position to deliver an unqualified
opinion (other than a qualification regarding changes in generally accepted
accounting principles) as to financial statements in which such principles have
been properly applied.
GUARANTEED PENSION PLAN. Any employee pension benefit plan within the
meaning of ss.3(2) of ERISA maintained or contributed to by the Borrower or any
ERISA Affiliate the benefits of which are guaranteed on termination in full or
in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer
Plan.
15
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GUARANTIES. The separate Guaranties, each in the form of EXHIBIT E,
dated or to be dated on, prior to or, in the case of any Subsidiary which
becomes a Guarantor pursuant to ss.9.5.2, after the Closing Date, made by each
Guarantor in favor of the Banks and the Agent pursuant to which such Guarantor
guaranties to the Banks and the Agent, to the extent provided therein, the
payment and performance of the Obligations.
GUARANTORS. (i) Hadco Santa Xxxxx; and (ii) any other direct or
indirect Subsidiary of the Borrower (other than Hadco FSC, New Zycon or Hadco
Malaysia).
HADCO ACQUISITION. Hadco Acquisition, a Delaware corporation and
one-time wholly-owned Subsidiary of the Borrower, which entity has previously
been merged into Zycon.
HADCO FSC. Hadco Foreign Sales Corporation, a U.S. Virgin Islands
corporation.
HADCO MALAYSIA. Hadco Corporation (Malaysia) SDN BHD, a Malaysian
Corporation, formerly known as Zycon Corporation SDN BHD.
HADCO SANTA XXXXX. Hadco Santa Xxxxx, Inc., a Delaware corporation,
formerly known as Zycon Corporation, the successor of the merger of Zycon and
Hadco Acquisition.
HAZARDOUS SUBSTANCES. See ss.7.17(b).
INDEBTEDNESS. All obligations, contingent and otherwise, that in
accordance with generally accepted accounting principles should be classified
upon the obligor's balance sheet as liabilities, or to which reference should be
made by footnotes thereto, including in any event and whether or not so
classified: (i) all debt and similar monetary obligations, whether direct or
indirect; (ii) all liabilities secured by any mortgage, pledge, security
interest, lien, charge or other encumbrance existing on property owned or
acquired subject thereto, whether or not the liability secured thereby shall
have been assumed; and (iii) all guarantees, endorsements and other contingent
obligations whether direct or indirect in respect of indebtedness of others,
including any obligation to supply funds to or in any manner to invest in,
directly or indirectly, the debtor, to purchase indebtedness, or to assure the
owner of indebtedness against loss, through an agreement to purchase goods,
supplies, or services for the purpose of enabling the debtor to make payment of
the indebtedness held by such owner or otherwise, and the obligations to
reimburse the issuer in respect of any letters of credit.
INELIGIBLE SECURITIES. Securities which may not be underwritten or
dealt in by member banks of the Federal Reserve System under Section 16 of the
Banking Act of 1993 (12 U.S.C. ss.24, Seventh), as amended.
INTEREST PAYMENT DATE. (i) As to any Base Rate Loan, the last day of
the calendar quarter which includes the Drawdown Date thereof; and (ii) as to
any Eurodollar Rate Loan in respect of which the Interest Period is (A) 3 months
or less, the last day of such Interest Period and (B) more than 3 months, the
date that is 3 months from the first day of such Interest Period and, in
addition, the last day of such Interest Period.
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INTEREST PERIOD. With respect to each Loan, (i) initially, the period
commencing on the Drawdown Date of such Loan and ending on the last day of one
of the periods set forth below, as selected by the Borrower in a Loan Request
(A) for any Base Rate Loan, the last day of the calendar quarter; and (B) for
any Eurodollar Rate Loan, 1, 2, 3 or 6 months; and (ii) thereafter, each period
commencing on the last day of the next preceding Interest Period applicable to
such Loan and ending on the last day of one of the periods set forth above, as
selected by the Borrower in a Conversion Request; PROVIDED that all of the
foregoing provisions relating to Interest Periods are subject to the following:
(a) if any Interest Period with respect to a Eurodollar Rate
Loan would otherwise end on a day that is not a Eurodollar Business
Day, that Interest Period shall be extended to the next succeeding
Eurodollar Business Day unless the result of such extension would be to
carry such Interest Period into another calendar month, in which event
such Interest Period shall end on the immediately preceding Eurodollar
Business Day;
(b) if any Interest Period with respect to a Base Rate Loan
would end on a day that is not a Business Day, that Interest Period
shall end on the next succeeding Business Day;
(c) if the Borrower shall fail to give notice as provided in
ss.2.7, the Borrower shall be deemed to have requested a conversion of
the affected Eurodollar Rate Loan to a Base Rate Loan and the
continuance of all Base Rate Loans as Base Rate Loans on the last day
of the then current Interest Period with respect thereto;
(d) any Interest Period relating to any Eurodollar Rate Loan
that begins on the last Eurodollar Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the
last Eurodollar Business Day of a calendar month; and
(e) any Interest Period relating to any Eurodollar Rate Loan
that would otherwise extend beyond the Revolving Credit Loan Maturity
Date shall end on the Revolving Credit Loan Maturity Date.
INVESTMENTS. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of stock or Indebtedness of, or
for loans, advances, capital contributions or transfers of property to, or in
respect of any guaranties (or other commitments as described under
Indebtedness), or obligations of, any Person. In determining the aggregate
amount of Investments outstanding at any particular time: (i) the amount of any
Investment represented by a guaranty shall be taken at not less than the
principal amount of the obligations guaranteed and still outstanding; (ii) there
shall be included as an Investment all interest accrued with respect to
Indebtedness constituting an Investment unless and until such interest is paid;
(iii) there shall be deducted in respect of each such Investment any amount
received as a return of capital (but only by repurchase, redemption, retirement,
repayment, liquidating dividend or liquidating distribution); (iv) there shall
not be deducted in respect of any Investment any amounts received as earnings on
such Investment, whether as dividends, interest or otherwise, except that
accrued interest included as provided in the foregoing clause (ii) may be
deducted when paid; and (v) there
17
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shall not be deducted from the aggregate amount of Investments any decrease in
the value thereof.
LETTER OF CREDIT. See ss.4.1.1.
LETTER OF CREDIT APPLICATION. See ss.4.1.1.
LETTER OF CREDIT PARTICIPATION. See ss.4.1.4.
LOAN DOCUMENTS. This Credit Agreement, the Notes, the Letter of Credit
Applications, the Letters of Credit, the Guaranties, the Agent's Side Letter,
the Post-Closing Letter, any interest rate protection agreements entered into
with any of the Banks in connection herewith and any other instruments,
documents and agreements executed from time to time in connection herewith.
LOAN REQUEST. See ss.2.6.
LOANS. Revolving credit loans made or to be made by the Banks to the
Borrower pursuant to ss.2.
MAJORITY BANKS. As of any date, the Banks holding at least fifty-one
percent (51%) of the outstanding principal amount of the Notes on such date; and
if no such principal is outstanding, the Banks whose aggregate Commitments
constitutes at least fifty-one percent (51%) of the Total Commitment.
MARGIN STOCK. "Margin stock" or "margin securities", as such terms are
used in Regulations U and X of the Board of Governors of the Federal Reserve
System, 12 C.F.R. Parts 221 and 224.
MAXIMUM DRAWING AMOUNT. The maximum aggregate amount that the
beneficiaries may at any time draw under outstanding Letters of Credit, as such
aggregate amount may be reduced from time to time pursuant to the terms of the
Letters of Credit.
MULTIEMPLOYER PLAN. Any multiemployer plan within the meaning of
ss.3(37) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate.
NEW ZYCON. Zycon Corporation, a Delaware corporation, and wholly owned
Subsidiary of the Borrower.
NON-CASH ACQUISITION EXPENSES. Non-cash expenses arising from the
write-off of goodwill, in-process research and development costs, and inventory
and fixed asset charges, in each case associated with Permitted Acquisitions
made following the Closing Date in an aggregate amount for all such Permitted
Acquisitions not to exceed $100,000,000.
NOTES. See ss.2.4.
OBLIGATIONS. All indebtedness, obligations and liabilities of any of
the Transaction Parties to any of the Banks and the Agent, individually or
collectively, existing on the date of this Credit Agreement or arising
thereafter, direct or indirect, joint or several, absolute or contingent,
matured or unmatured, liquidated or unliquidated, secured or unsecured, arising
18
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by contract, operation of law or otherwise, arising or incurred under this
Credit Agreement or any of the other Loan Documents or in respect of any of the
Loans made or Reimbursement Obligations incurred or any of the Notes, Letter of
Credit Application, Letter of Credit or other instruments at any time evidencing
any thereof.
ORIGINAL CREDIT AGREEMENT. As defined in the preamble hereto.
OUTSTANDING. With respect to the Loans, the aggregate unpaid principal
thereof as of any date of determination.
PBGC. The Pension Benefit Guaranty Corporation created by ss.4002 of
ERISA and any successor entity or entities having similar responsibilities.
PERMITTED ACQUISITIONS. Acquisitions of stock or assets permitted by
ss.9.5.2.
PERMITTED LIENS. Liens, security interests and other encumbrances
permitted by ss.9.2.
PERSON. Any individual, corporation, partnership, trust, unincorporated
association, business, or other legal entity, and any government or any
governmental agency or political subdivision thereof.
POST-CLOSING LETTER. The side letter dated as of December 8, 1997
between the Agent and the Borrower regarding certain post-closing items.
REAL ESTATE. All real property at any time owned or leased (as lessee
or sublessee) by any of the Transaction Parties.
REIMBURSEMENT OBLIGATION. The Borrower's obligation to reimburse the
Agent and the Banks on account of any drawing under any Letter of Credit as
provided in ss.4.2.
REVOLVING CREDIT LOAN MATURITY DATE. January 8, 2002.
SECTION 20 SUBSIDIARY. A Subsidiary of the bank holding company
controlling any Bank, which Subsidiary has been granted authority by the Federal
Reserve Board to underwrite and deal in certain Ineligible Securities.
SUBSIDIARY. Any corporation, association, trust, or other business
entity of which the designated parent shall at any time own directly or
indirectly through a Subsidiary or Subsidiaries at least a majority (by number
of votes) of the outstanding Voting Stock.
TARGET. As defined in ss.9.5.2(b).
TOTAL COMMITMENT. The sum of the Commitments of the Banks, as in effect
from time to time.
TRANSACTION PARTIES. Collectively, the Borrower and its Subsidiaries.
TYPE. As to any Loan, its nature as a Base Rate Loan or a Eurodollar
Rate Loan.
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UNIFORM CUSTOMS. With respect to any Letter of Credit, the Uniform
Customs and Practice for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500 or any successor version thereto adopted
by the Agent in the ordinary course of its business as a letter of credit issuer
and in effect at the time of issuance of such Letter of Credit.
UNPAID REIMBURSEMENT OBLIGATION. Any Reimbursement Obligation for which
the Borrower does not reimburse the Agent and the Banks on the date specified
in, and in accordance with, ss.4.2.
VOTING STOCK. Stock or similar interests, of any class or classes
(however designated), the holders of which are at the time entitled, as such
holders, to vote for the election of a majority of the directors (or persons
performing similar functions) of the corporation, association, trust or other
business entity involved, whether or not the right so to vote exists by reason
of the happening of a contingency.
ZYCON. Zycon Corporation, a Delaware corporation, the company into
which Hadco Acquisition has previously been merged, and which is now known as
Hadco Santa Xxxxx.
ZYCON BALANCE SHEET DATE. November 30, 1996.
ZYCON EMPLOYEE DISTRIBUTION. The Distribution made in January, 1997 in
an aggregate amount not exceeding $6,000,000, in order to pay employees of Zycon
the difference between the exercise price of the stock options owned by such
employees and the price per share offered and paid by Hadco Acquisition for
shares of the capital stock of Zycon.
ZYCON ACQUISITION RELATED WRITE-OFF. Up to $80,000,000 in non-cash
expenses associated with goodwill resulting from the purchase of Zycon and with
in-process research and development costs of Zycon.
1.2. RULES OF INTERPRETATION.
(a) A reference to any document or agreement shall include
such document or agreement as amended, modified or supplemented from
time to time in accordance with its terms and the terms of this Credit
Agreement.
(b) The singular includes the plural and the plural includes the
singular.
(c) A reference to any law includes any amendment or
modification to such law.
(d) A reference to any Person includes its permitted successors
and permitted assigns.
(e) Accounting terms not otherwise defined herein have the
meanings assigned to them by generally accepted accounting principles
applied on a consistent basis by the accounting entity to which they
refer.
(f) The words "include", "includes" and "including" are not
limiting.
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(g) All terms not specifically defined herein or by generally
accepted accounting principles, which terms are defined in the Uniform
Commercial Code as in effect in the Commonwealth of Massachusetts, have
the meanings assigned to them therein, with the term "instrument" being
that defined under Article 9 of the Uniform Commercial Code.
(h) Reference to a particular "ss." refers to that section of
this Credit Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of
like import shall refer to this Credit Agreement as a whole and not to
any particular section or subdivision of this Credit Agreement.
2. THE REVOLVING CREDIT FACILITY.
2.1. COMMITMENT TO LEND. Subject to the terms and conditions set forth
in this Credit Agreement, each of the Banks severally agrees to lend to the
Borrower and the Borrower may borrow, repay, and reborrow from time to time
between the Closing Date and the Revolving Credit Loan Maturity Date upon notice
by the Borrower to the Agent given in accordance with ss.2.6, such sums as are
requested by the Borrower up to a maximum aggregate amount outstanding (after
giving effect to all amounts requested) at any one time equal to such Bank's
Commitment MINUS such Bank's Commitment Percentage of the sum of the Maximum
Drawing Amount and all Unpaid Reimbursement Obligations, PROVIDED that the sum
of the outstanding amount of the Loans (after giving effect to all amounts
requested) PLUS the Maximum Drawing Amount and all Unpaid Reimbursement
Obligations shall not at any time exceed the Total Commitment. The Loans shall
be made PRO RATA in accordance with each Bank's Commitment Percentage. Each
request for a Loan hereunder shall constitute a representation and warranty by
the Borrower that the conditions set forth in ss.11 and ss.12, in the case of
the initial Loans to be made on the Closing Date, and ss.12, in the case of all
other Loans, have been satisfied on the date of such request.
2.2. COMMITMENT FEE. The Borrower agrees to pay to the Agent for the
accounts of the Banks in accordance with their respective Commitment Percentages
a commitment fee calculated at a rate per annum equal to the Applicable
Commitment Fee Percentage on the average daily amount during each calendar
quarter or portion thereof from Closing Date to the Revolving Credit Loan
Maturity Date by which the Total Commitment MINUS the sum of the Maximum Drawing
Amount and all Unpaid Reimbursement Obligations exceeds the outstanding amount
of Loans during such calendar quarter. The commitment fee shall be payable
quarterly in arrears on the first day of each calendar quarter for the
immediately preceding calendar quarter commencing on the first such date
following the date hereof, with a final payment on the Revolving Credit Loan
Maturity Date or any earlier date on which the Commitments shall terminate.
2.3. REDUCTION OF TOTAL COMMITMENT. Upon the Borrower's incurrence of
any Indebtedness permitted by ss.9.1(k), the Borrower shall, at the request of
the Majority Banks, reduce the Total Commitment by an amount equal to the net
proceeds of all such Indebtedness incurred following the Closing Date, up to a
maximum of $50,000,000 in connection with any such Indebtedness described in
ss.9.1(k)(i) and up to a cumulative maximum of $100,000,000 in connection with
any such Indebtedness described in
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ss.9.1(k)(ii). The Borrower shall have the right, without penalty (other than
breakage fees relating to Eurodollar Rate Loans for which the Borrower is
otherwise responsible under ss.5.9 and as otherwise provided in this ss.2.3), at
any time and from time to time upon seven (7) Business Days prior written notice
to the Agent to reduce by $10,000,000 or an integral multiple of $5,000,000 in
excess thereof or terminate entirely the Total Commitment; PROVIDED, HOWEVER,
that the Total Commitment shall not be reduced below $50,000,000 unless it is
terminated in full; and PROVIDED FURTHER that if, on or before January 8, 1998,
the Borrower incurs Indebtedness permitted by ss.9.1(k) or sells equity
securities of the Borrower, or warrants or subscription rights for equity
securities of the Borrower, the sale or issuance of any of which does not create
or result in a Default or Event of Default, in an aggregate amount for all such
Indebtedness and net proceeds of the sale of such equity securities, or warrants
or subscription rights for equity securities, in excess of $75,000,000, and the
Borrower, at its option, reduces the Total Commitment by more than $75,000,000,
the Borrower shall, at the time of such reduction of the Total Commitment, pay
to the Agent, for the PRO RATA benefit of the Banks, a fee equal to one fifth of
one percent (.20%) on the amount by which such reduction in the Total Commitment
exceeds $75,000,000. Upon any such reduction of the Total Commitment as set
forth in either of the two immediately preceding sentences, the Commitments of
the Banks shall be reduced PRO RATA in accordance with their respective
Commitment Percentages of the amount specified in such notice or, as the case
may be, terminated. Promptly after receiving any notice of the Borrower
delivered pursuant to this ss.2.3, the Agent will notify the Banks of the
substance thereof. Upon the effective date of any such reduction or termination,
the Borrower shall pay to the Agent for the respective accounts of the Banks the
full amount of any commitment fee then accrued on the amount of the reduction.
No reduction or termination of the Commitments may be reinstated.
2.4. THE NOTES. The Loans shall be evidenced by separate promissory
notes of the Borrower in substantially the form of EXHIBIT A hereto (each a
"Note"), dated as of the Closing Date and completed with appropriate insertions.
One Note shall be payable to the order of each Bank in a principal amount equal
to such Bank's Commitment or, if less, the outstanding amount of all Loans made
by such Bank, plus interest accrued thereon, as set forth below. The Borrower
irrevocably authorizes each Bank to make or cause to be made, at or about the
time of the Drawdown Date of any Loan or at the time of receipt of any payment
of principal on such Bank's Note, an appropriate computer entry or other record
reflecting the making of such Loan or (as the case may be) the receipt of such
payment. The outstanding amount of the Loans set forth in such computer entries
or other records shall be PRIMA FACIE evidence of the principal amount thereof
owing and unpaid to such Bank, but the failure to record, or any error in so
recording, any such amount in such computer entries or other records shall not
limit or otherwise affect the obligations of the Borrower hereunder or under any
Note to make payments of principal of or interest on any Note when due.
2.5. INTEREST ON LOANS. Except as otherwise provided in ss.5.10,
(a) Each Base Rate Loan shall bear interest for the period
commencing with the Drawdown Date thereof and ending on the last day of
the Interest Period with respect thereto at a rate per annum equal to
the Base Rate.
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(b) Each Eurodollar Rate Loan shall bear interest for the
period commencing with the Drawdown Date thereof and ending on the last
day of the Interest Period with respect thereto at a rate per annum
equal to the Applicable Eurodollar Rate Margin PLUS the Eurodollar Rate
determined for such Interest Period.
(c) The Borrower promises to pay interest on each Loan in
arrears on each Interest Payment Date with respect thereto.
2.6. REQUESTS FOR LOANS. The Borrower shall give to the Agent written
notice in the form of EXHIBIT B hereto (or telephonic notice confirmed in a
writing in the form of EXHIBIT B hereto) of each Loan requested hereunder (a
"Loan Request") no less than (i) one (1) Business Day prior to the proposed
Drawdown Date of any Base Rate Loan and (ii) three (3) Eurodollar Business Days
prior to the proposed Drawdown Date of any Eurodollar Rate Loan. Each such
notice shall specify (A) the principal amount of the Loan requested, (B) the
proposed Drawdown Date of such Loan, (C) the Interest Period for such Revolving
Credit Loan and (D) the Type of such Loan. Promptly upon receipt of any such
notice, the Agent shall notify each of the Banks thereof. Each Loan Request
shall be irrevocable and binding on the Borrower and shall obligate the Borrower
to accept the Loan requested from the Banks on the proposed Drawdown Date. Each
Loan Request shall be in a minimum aggregate amount of $5,000,000 or an integral
multiple thereof.
2.7. CONVERSION OPTIONS.
2.7.1. CONVERSION TO DIFFERENT TYPE OF LOAN. The Borrower may
elect from time to time to convert any outstanding Loan to a
Loan of another Type, PROVIDED that (i) with respect to any such
conversion of a Loan to a Base Rate Loan, the Borrower shall
give the Agent at least one (1) Business Day prior written
notice of such election; (ii) with respect to any such
conversion of a Base Rate Loan to a Eurodollar Rate Loan, the
Borrower shall give the Agent at least three (3) Eurodollar
Business Days prior written notice of such election; (iii) with
respect to any such conversion of a Eurodollar Rate Loan into a
Loan of another Type, such conversion shall only be made on the
last day of the Interest Period with respect thereto; and (iv)
no Loan may be converted into a Eurodollar Rate Loan when any
Default or Event of Default has occurred and is continuing. On
the date on which such conversion is being made, each Bank shall
take such action as is necessary to transfer its Commitment
Percentage of such Loans to its Domestic Lending Office or its
Eurodollar Lending Office, as the case may be. All or any part
of outstanding Loans of any Type may be converted into a Loan of
another Type as provided herein, PROVIDED that any partial
conversion shall be in an aggregate principal amount of
$5,000,000 or a whole multiple thereof. Each Conversion Request
relating to the conversion of a Loan to a Eurodollar Rate Loan
shall be irrevocable by the Borrower.
2.7.2. CONTINUATION OF TYPE OF LOAN. Any Loan of any Type may be
continued as a Loan of the same Type upon the expiration of an
Interest Period with respect thereto by compliance by the
Borrower with the notice provisions contained in ss.2.7.1;
PROVIDED that no Eurodollar Rate Loan may
23
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be continued as such when any Default or Event of Default has
occurred and is continuing, but shall be automatically converted
to a Base Rate Loan on the last day of the first Interest Period
relating thereto ending during the continuance of any Default or
Event of Default of which officers of the Agent active upon the
Borrower's account have actual knowledge. In the event that the
Borrower fails to provide any such notice with respect to the
continuation of any Eurodollar Rate Loan as such, then such
Eurodollar Rate Loan shall be automatically converted to a Base
Rate Loan on the last day of the first Interest Period relating
thereto. The Agent shall notify the Banks promptly when any such
automatic conversion contemplated by this ss.2.7 is scheduled to
occur.
2.7.3. EURODOLLAR RATE LOANS. Any conversion to or from
Eurodollar Rate Loans shall be in such amounts and be made
pursuant to such elections so that, after giving effect thereto,
the aggregate principal amount of all Eurodollar Rate Loans
having the same Interest Period shall not be less than
$20,000,000 or a whole multiple of $5,000,000 in excess thereof.
At no time shall there be more than five (5) Eurodollar Rate
Loans outstanding.
2.8. FUNDS FOR LOANS.
2.8.1. FUNDING PROCEDURES. Not later than 11:00 a.m. (Boston
time) on the proposed Drawdown Date of any Loans, each of the
Banks will make available to the Agent, at its Head Office, in
immediately available funds, the amount of such Bank's
Commitment Percentage of the amount of the requested Loans. Upon
receipt from each Bank of such amount, and upon receipt of the
documents required by ss.ss.11 and 12 and the satisfactIon of
the other conditions set forth therein, to the extent
applicable, the Agent will make available to the Borrower the
aggregate amount of such Loans made available to the Agent by
the Banks. The failure or refusal of any Bank to make available
to the Agent at the aforesaid time and place on any Drawdown
Date the amount of its Commitment Percentage of the requested
Loans shall not relieve any other Bank from its several
obligation hereunder to make available to the Agent the amount
of such other Bank's Commitment Percentage of any requested
Loans.
2.8.2. ADVANCES BY AGENT. The Agent may, unless notified to the
contrary by any Bank prior to a Drawdown Date, assume that such
Bank has made available to the Agent on such Drawdown Date the
amount of such Bank's Commitment Percentage of the Loans to be
made on such Drawdown Date, and the Agent may (but it shall not
be required to), in reliance upon such assumption, make
available to the Borrower a corresponding amount. If any Bank
makes available to the Agent such amount on a date after such
Drawdown Date, such Bank shall pay to the Agent on demand an
amount equal to the product of (i) the average computed for the
period referred to in clause (iii) below, of the weighted
average interest rate paid by the Agent for federal funds
acquired by the Agent during each day included in such period,
TIMES (ii) the amount of such Bank's Commitment Percentage of
such Loans, TIMES (iii) a fraction, the numerator of which is
the number of days that
24
-17-
elapse from and including such Drawdown Date to the date on
which the amount of such Bank's Commitment Percentage of such
Loans shall become immediately available to the Agent, and the
denominator of which is 360. A statement of the Agent submitted
to such Bank with respect to any amounts owing under this
paragraph shall be PRIMA FACIE evidence of the amount due and
owing to the Agent by such Bank. If the amount of such Bank's
Commitment Percentage of such Loans is not made available to the
Agent by such Bank within three (3) Business Days following such
Drawdown Date, the Agent shall be entitled to recover such
amount from the Borrower on demand, with interest thereon at the
rate per annum applicable to the Loans made on such Drawdown
Date.
3. REPAYMENT OF THE REVOLVING CREDIT LOANS.
3.1. MATURITY. The Borrower promises to pay on the Revolving Credit
Loan Maturity Date, and there shall become absolutely due and payable on the
Revolving Credit Loan Maturity Date, all of the Loans outstanding on such date,
together with any and all accrued and unpaid interest thereon.
3.2. MANDATORY REPAYMENTS OF LOANS. If at any time the Borrower shall
incur Indebtedness permitted by ss.9.1(k), the Borrower shall, at the request of
the Majority Banks, immediately pay to the Agent for the respective accounts of
the Banks an amount equal to the net proceeds of all such Indebtedness incurred
following the Closing Date, up to a maximum of $50,000,000 in connection with
any such Indebtedness described in ss.9.1(k)(i) and up to a cumulative maximum
of $100,000,000 in connectioN with any such Indebtedness described in
ss.9.1(k)(ii). If at any time the sum of the outstanding amounT of the Loans,
the Maximum Drawing Amount and all Unpaid Reimbursement Obligations exceeds the
Total Commitment, then the Borrower shall immediately pay the amount of such
excess to the Agent for the respective accounts of the Banks. Any amounts repaid
in accordance with either of the immediately preceding two sentences shall be
applied: first, to any Unpaid Reimbursement Obligations; second, to the Loans;
and third, to provide to the Agent cash collateral for Reimbursement Obligations
as contemplated by ss.4.2(b) and (c). Each payment of any Unpaid Reimbursement
Obligations or prepayment of Loans shall be allocated among the Banks, in
proportion, as nearly as practicable, to each Reimbursement Obligation or (as
the case may be) the respective unpaid principal amount of each Bank's Note,
with adjustments to the extent practicable to equalize any prior payments or
repayments not exactly in proportion.
3.3. OPTIONAL REPAYMENTS OF LOANS. The Borrower shall have the right,
at its election, to repay the outstanding amount of the Loans, as a whole or in
part, at any time without penalty or premium, PROVIDED that any full or partial
prepayment of the outstanding amount of any Eurodollar Rate Loans pursuant to
this ss.3.3 may be made only on the last day of the Interest Period relating
thereto. The Borrower shall give the Agent, no later than 10:00 a.m., Boston
time, at least one (1) Business Day prior written notice of any proposed
prepayment pursuant to this ss.3.3 of Base Rate Loans, and three (3) Eurodollar
Business Days notice of any proposed prepayment pursuant to this ss.3.3 of
Eurodollar Rate Loans, in each case specifying the proposed date of prepayment
of Loans and the principal amount to be prepaid. Each such partial prepayment of
the Loans shall be in an integral multiple of $5,000,000 and shall be applied,
in the absence of instruction by the Borrower, first to the
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principal of Base Rate Loans and then to the principal of Eurodollar Rate Loans.
Accrued interest on the principal prepaid in connection with each such partial
prepayment shall be due and payable on the next Interest Payment Date, but
accrued interest on the principal paid in connection with any full prepayment at
a time when the Total Commitment is terminated shall be paid on the date of
prepayment. Each prepayment shall be allocated among the Banks, in proportion,
as nearly as practicable, to the respective unpaid principal amount of each
Bank's Note, with adjustments to the extent practicable to equalize any prior
repayments not exactly in proportion.
4. LETTERS OF CREDIT.
4.1. LETTER OF CREDIT COMMITMENTS.
4.1.1. COMMITMENT TO ISSUE LETTERS OF CREDIT. Subject to the
terms and conditions hereof and the execution and delivery by
the Borrower of a letter of credit application on the Agent's
customary form (a "Letter of Credit Application"), the Agent on
behalf of the Banks and in reliance upon the agreement of the
Banks set forth in ss.4.1.4 and upon the representations and
warranties of the Borrower contained herein, agrees, in its
individual capacity, to issue, extend and renew for the account
of the Borrower one or more standby or documentary letters of
credit (individually, a "Letter of Credit"), in such form as may
be requested from time to time by the Borrower and agreed to by
the Agent; PROVIDED, HOWEVER, that, after giving effect to such
request, (a) the sum of the aggregate Maximum Drawing Amount and
all Unpaid Reimbursement Obligations shall not exceed
$15,000,000 at any one time and (b) the sum of (i) the Maximum
Drawing Amount on all Letters of Credit, (ii) all Unpaid
Reimbursement Obligations, and (iii) the amount of all Loans
outstanding (after giving effect to all amounts requested) shall
not exceed the Total Commitment. As of the Closing Date, the
Letter of Credit initially issued in the amount of $1,000,000 to
New York State Urban Development Corporation for the account of
the Borrower shall become a Letter of Credit under this Credit
Agreement for all purposes, shall be issued for the account of
the Borrower and shall cease to be a Letter of Credit under and
as defined in the Original Credit Agreement, and the Exiting
Lenders shall cease to have any further obligations with respect
thereto.
4.1.2. LETTER OF CREDIT APPLICATIONS. Each Letter of Credit
Application shall be completed to the satisfaction of the Agent.
In the event that any provision of any Letter of Credit
Application shall be inconsistent with any provision of this
Credit Agreement, then the provisions of this Credit Agreement
shall, to the extent of any such inconsistency, govern.
4.1.3. TERMS OF LETTERS OF CREDIT. Each Letter of Credit issued,
extended or renewed hereunder shall, among other things, (i)
provide for the payment of sight drafts for honor thereunder
when presented in accordance with the terms thereof and when
accompanied by the documents described therein, (ii) have an
expiry date (which may be extended annually by the Agent, at its
option upon the request of the Borrower) no more than one year
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following its date of issue and (iii) have an expiry date no
later than the date which is fourteen (14) days (or, if the
Letter of Credit is confirmed by a confirmer or otherwise
provides for one or more nominated persons, forty-five (45)
days) prior to the Revolving Credit Loan Maturity Date. Each
Letter of Credit so issued, extended or renewed shall be subject
to the Uniform Customs.
4.1.4. REIMBURSEMENT OBLIGATIONS OF BANKS. Each Bank severally
agrees that it shall be absolutely liable, without regard to the
occurrence of any Default or Event of Default or any other
condition precedent whatsoever, to the extent of such Bank's
Commitment Percentage, to reimburse the Agent on demand for the
amount of each draft paid by the Agent under each Letter of
Credit to the extent that such amount is not reimbursed by the
Borrower pursuant to ss.4.2 (such agreement for a Bank being
called herein the "Letter of Credit Participation" of such
Bank).
4.1.5. PARTICIPATIONS OF BANKS. Each such payment made by a Bank
shall be treated as the purchase by such Bank of a participating
interest in the Borrower's Reimbursement Obligation under ss.4.2
in an amount equal to such payment. Each Bank shall share in
accordance with its participating interest in any interest which
accrues pursuant to ss.4.2.
4.2. REIMBURSEMENT OBLIGATION OF THE BORROWER. In order to induce the
Agent to issue, extend and renew each Letter of Credit and the Banks to
participate therein, the Borrower hereby agrees to reimburse or pay to the
Agent, for the account of the Agent or (as the case may be) the Banks, with
respect to each Letter of Credit issued, extended or renewed by the Agent
hereunder,
(a) except as otherwise expressly provided in ss.4.2(b) and
(c), on each date that any draft presented under such Letter of Credit
is honored by the Agent, or the Agent otherwise makes a payment with
respect thereto, (i) the amount paid by the Agent under or with respect
to such Letter of Credit, and (ii) the amount of any taxes, fees,
charges or other reasonable costs and expenses whatsoever incurred by
the Agent or any Bank in connection with any payment made by the Agent
or any Bank under, or with respect to, such Letter of Credit,
(b) upon the reduction (but not termination) of the Total
Commitment to an amount less than the Maximum Drawing Amount, an amount
equal to such difference, which amount shall be held by the Agent for
the benefit of the Banks and the Agent in an interest bearing account
selected by the Agent as cash collateral for all Reimbursement
Obligations, and
(c) upon the termination of the Total Commitment, or the
acceleration of the Reimbursement Obligations with respect to all
Letters of Credit in accordance with ss.13, an amount equal to the then
Maximum Drawing Amount on all Letters of Credit, which amount shall be
held by the Agent for the benefit of the Banks and the Agent in an
interest bearing account selected by the Agent as cash collateral for
all Reimbursement Obligations.
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Each such payment shall be made to the Agent at the Agent's Head Office in
immediately available funds. Interest on any and all amounts remaining unpaid by
the Borrower under this ss.4.2 at any time from the date such amounts become due
and payable (whether as stated in this ss.4.2, by acceleration or otherwise)
until payment in full (whether before or after judgment) shall be payable to the
Agent on demand at the rate specified in ss.5.10 for overdue principal on the
Loans. So long as no Default or Event of Default has occurred and is continuing,
the Agent shall return amounts held as cash collateral pursuant to ss.4.2(b) or
as a result of the Borrower's termination of the Total Commitment pursuant to
ss.4.2(c) within a reasonable time following the expiration or cancellation of
any Letter of Credit, with the amount being so returned equal to the Maximum
Drawing Amount of such expired or cancelled Letter of Credit.
4.3. LETTER OF CREDIT PAYMENTS. If any draft shall be presented or
other demand for payment shall be made under any Letter of Credit, the Agent
shall notify the Borrower of the date and amount of the draft presented or
demand for payment and of the date and time when it expects to pay such draft or
honor such demand for payment. If the Borrower fails to reimburse the Agent as
provided in ss.4.2 on or before the date that such draft is paid or other
payment is made by the Agent, the Agent may at any time thereafter notify the
Banks of the amount of any such Unpaid Reimbursement Obligation. No later than
3:00 p.m. (Boston time) on the Business Day next following the receipt of such
notice, each Bank shall make available to the Agent, at its Head Office, in
immediately available funds, such Bank's Commitment Percentage of such Unpaid
Reimbursement Obligation, together with an amount equal to the product of (i)
the average, computed for the period referred to in clause (iii) below, of the
weighted average interest rate paid by the Agent for federal funds acquired by
the Agent during each day included in such period, TIMES (ii) the amount equal
to such Bank's Commitment Percentage of such Unpaid Reimbursement Obligation,
TIMES (iii) a fraction, the numerator of which is the number of days that elapse
from and including the date the Agent paid the draft presented for honor or
otherwise made payment to the date on which such Bank's Commitment Percentage of
such Unpaid Reimbursement obligation shall become immediately available to the
Agent, and the denominator of which is 360. The responsibility of the Agent to
the Borrower and the Banks shall be only to determine that the documents
(including each draft) delivered under each Letter of Credit in connection with
such presentment shall be in conformity in all material respects with such
Letter of Credit, and upon such determination, the Agent shall honor a demand
for payment under such Letter of Credit.
4.4. OBLIGATIONS ABSOLUTE. The Borrower's obligations under this ss.4
shall be absolute and unconditional under any and all circumstances and
irrespective, so long as the Agent has honored any appropriate demand for
payment with respect to any Letter of Credit, of the occurrence of any Default
or Event of Default or any condition precedent whatsoever or any setoff,
counterclaim or defense to payment which the Borrower may have or have had
against the Agent, any Bank or any beneficiary of a Letter of Credit. The
Borrower further agrees with the Agent and the Banks that the Agent and the
Banks shall not be responsible for, and the Borrower's Reimbursement Obligations
under ss.4.2 shall not be affected by, among other things, the validity or
genuineness of documents or of any endorsements thereon, even if such documents
should in fact prove to be in any or all respects invalid, fraudulent or forged,
or any dispute between or among the Borrower, the beneficiary of any Letter of
Credit or any financing institution or other party to which any Letter of Credit
may be transferred or any claims or defenses whatsoever of the Borrower
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against the beneficiary of any Letter of Credit or any such transferee. The
Agent and the Banks shall not be liable for any error, omission, interruption or
delay in transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Letter of Credit. The Borrower agrees that
any action taken or omitted by the Agent or any Bank under or in connection with
each Letter of Credit and the related drafts and documents, if done in good
faith and with commercial reasonableness, shall be binding upon the Borrower and
shall not result in any liability on the part of the Agent or any Bank to the
Borrower.
4.5. RELIANCE BY ISSUER. To the extent not inconsistent with ss.4.4,
the Agent shall be entitled to rely, and shall be fully protected in relying
upon, any Letter of Credit, draft, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons
and upon advice and statements of legal counsel, independent accountants and
other experts selected by the Agent. The Agent shall be fully justified in
failing or refusing to take any action under this Agreement unless it shall
first have received such advice or concurrence of the Majority Banks as it
reasonably deems appropriate or it shall first be indemnified to its reasonable
satisfaction by the Banks against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such action. The
Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement in accordance with a request of the Majority Banks,
and such request and any action taken or failure to act pursuant thereto shall
be binding upon the Banks and all future holders of the Notes or of a Letter of
Credit Participation.
4.6. LETTER OF CREDIT FEE. The Borrower shall, on the date of issuance
or any extension or renewal of any Letter of Credit and at such other time or
times as such charges are customarily made by the Agent, pay a fee (in each
case, a "Letter of Credit Fee") to the Agent (i) in respect of each standby
Letter of Credit equal to (A) the Applicable Eurodollar Rate Margin in effect on
such date MULTIPLIED BY the face amount of such standby Letter of Credit PLUS
(B) the Agent's customary issuance fee PLUS (C) a fronting fee (for the account
of the Agent) equal to one-eighth of one percent (0.125)% per annum of the face
amount of such standby Letter of Credit, and (ii) in respect of each documentary
Letter of Credit equal to (A) the Agent's customary administrative fees PLUS (B)
the Applicable Eurodollar Rate Margin in effect on such date MULTIPLIED BY the
face amount of such documentary Letter of Credit, PLUS (C) a fronting fee to the
Agent equal to one-eighth of one percent (0.125%) per annum of the face amount
of such documentary Letter of Credit, such Letter of Credit Fee (but not such
issuance, administrative or fronting fees) to be for the accounts of the Banks
in accordance with their respective Commitment Percentages.
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5. CERTAIN GENERAL PROVISIONS.
5.1. FEES. The Borrower agrees to pay to the Agent the fees described
in the letter dated as of the date hereof between the Agent and the Borrower
(the "Agent's Side Letter") in accordance with the terms and conditions thereof.
5.2. FUNDS FOR PAYMENTS.
5.2.1. PAYMENTS TO AGENT. All payments of principal, interest,
Reimbursement Obligations, commitment fees, Letter of Credit
Fees and any other amounts due hereunder or under any of the
other Loan Documents shall be made to the Agent, for the
respective accounts of the Banks and the Agent, at the Agent's
Head Office or at such other location in the Boston,
Massachusetts, area that the Agent may from time to time
designate, in each case in immediately available funds.
5.2.2. NO OFFSET, ETC. All payments by the Borrower hereunder
and under any of the other Loan Documents shall be made without
setoff or counterclaim and free and clear of and without
deduction for any taxes, levies, imposts, duties, charges, fees,
deductions, withholdings, compulsory loans, restrictions or
conditions of any nature now or hereafter imposed or levied by
any jurisdiction or any political subdivision thereof or taxing
or other authority therein unless the Borrower is compelled by
law to make such deduction or withholding. If any such
obligation is imposed upon the Borrower with respect to any
amount payable by it hereunder or under any of the other Loan
Documents, the Borrower will pay to the Agent, for the account
of the Banks or (as the case may be) the Agent, on the date on
which such amount is due and payable hereunder or under such
other Loan Document, such additional amount in Dollars as shall
be necessary to enable the Banks or the Agent to receive the
same net amount which the Banks or the Agent would have received
on such due date had no such obligation been imposed upon the
Borrower. The Borrower will deliver promptly to the Agent
certificates or other valid vouchers for all taxes or other
charges deducted from or paid with respect to payments made by
the Borrower hereunder or under such other Loan Document.
5.3. COMPUTATIONS. All computations of interest on the Loans and of
commitment fees, Letter of Credit Fees or other fees shall, unless otherwise
expressly provided herein, be based on a 360-day year and paid for the actual
number of days elapsed; PROVIDED, HOWEVER, that computations of interest on Base
Rate Loans shall be based on a 365 or, as the case may be, 366-day year and paid
for the actual number of days elapsed. Except as otherwise provided in the
definition of the term "Interest Period" with respect to Eurodollar Rate Loans,
whenever a payment hereunder or under any of the other Loan Documents becomes
due on a day that is not a Business Day, the due date for such payment shall be
extended to the next succeeding Business Day, and interest shall accrue during
such extension. The outstanding amount of the Loans as reflected on the records
of each Bank and the Agent from time to time shall be considered correct and
binding on the Borrower unless within five (5) Business Days after receipt of
any notice from the Agent or any of the Banks of such outstanding amount, the
Borrower shall notify the Agent or such Bank to the contrary.
5.4. INABILITY TO DETERMINE EURODOLLAR RATE. In the event, prior to the
commencement of any Interest Period relating to any Eurodollar Rate Loan, the
Agent shall determine or be notified by the Majority Banks that adequate and
reasonable methods do not exist for ascertaining the Eurodollar Rate that would
otherwise determine the rate of interest to be applicable to any Eurodollar Rate
Loan during any Interest Period, the Agent shall forthwith give notice of such
determination (which shall be conclusive and binding on
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the Borrower and the Banks) to the Borrower and the Banks. In such event (i) any
Loan Request or Conversion Request with respect to Eurodollar Rate Loans shall
be automatically withdrawn and shall be deemed a request for Base Rate Loans,
(ii) each Eurodollar Rate Loan will automatically, on the last day of the then
current Interest Period relating thereto, become a Base Rate Loan, and (iii) the
obligations of the Banks to make Eurodollar Rate Loans shall be suspended until
the Agent determines that the circumstances giving rise to such suspension no
longer exist, whereupon the Agent shall so notify the Borrower and the Banks.
5.5. ILLEGALITY. Notwithstanding any other provisions herein, if any
present or future law, regulation, treaty or directive or in the interpretation
or application thereof shall make it unlawful for any Bank to make or maintain
Eurodollar Rate Loans, such Bank shall forthwith give notice of such
circumstances to the Borrower and the other Banks and thereupon (i) the
commitment of such Bank to make Eurodollar Rate Loans or convert Loans of
another Type to Eurodollar Rate Loans shall forthwith be suspended and (ii) such
Bank's Loans then outstanding as Eurodollar Rate Loans, if any, shall be
converted automatically to Base Rate Loans on the last day of each Interest
Period applicable to such Eurodollar Rate Loans or within such earlier period as
may be required by law. The Borrower hereby agrees promptly to pay the Agent for
the account of such Bank, upon demand by such Bank, any additional amounts
necessary to compensate such Bank for any costs incurred by such Bank in making
any conversion in accordance with this ss.5.5, including any interest or fees
payable by such Bank to lenders of funds obtained by it in order to make or
maintain its Eurodollar Rate Loans hereunder.
5.6. ADDITIONAL COSTS, ETC. If any present or future applicable law,
which expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any competent court or by any
governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon or
otherwise issued to any Bank or the Agent by any central bank or other fiscal,
monetary or other authority (whether or not having the force of law), shall:
(a) subject any Bank or the Agent to any tax, levy, impost, duty,
charge, fee, deduction or withholding of any nature with respect to
this Credit Agreement, the other Loan Documents, any Letters of Credit,
such Bank's Commitment or the Loans (other than taxes based upon or
measured by the income or profits of such Bank or the Agent), or
(b) materially change the basis of taxation (except for changes in
taxes on income or profits) of payments to any Bank of the principal of
or the interest on any Loans or any other amounts payable to any Bank
or the Agent under this Credit Agreement or any of the other Loan
Documents, or
(c) impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Credit Agreement)
any special deposit, reserve, assessment, liquidity, capital adequacy
or other similar requirements (whether or not having the force of law)
against assets held by, or deposits in or for the account of, or loans
by, or letters of credit issued by, or commitments of an office of any
Bank, or
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(d) impose on any Bank or the Agent any other conditions or
requirements with respect to this Credit Agreement, the other Loan
Documents, any Letters of Credit, the Loans, such Bank's Commitment, or
any class of loans, letters of credit or commitments of which any of
the Loans or such Bank's Commitment forms a part, and the result of any
of the foregoing is
(i) to increase the cost to any Bank of making, funding,
issuing, renewing, extending or maintaining any of the Loans or
such Bank's Commitment or any Letter of Credit, or
(ii) to reduce the amount of principal, interest,
Reimbursement Obligation or other amount payable to such Bank or
the Agent hereunder on account of such Bank's Commitment, any
Letter of Credit or any of the Loans, or
(iii) to require such Bank or the Agent to make any payment
or to forego any interest or Reimbursement Obligation or other sum
payable hereunder, the amount of which payment or foregone
interest or Reimbursement Obligation or other sum is calculated by
reference to the gross amount of any sum receivable or deemed
received by such Bank or the Agent from the Borrower hereunder,
then, and in each such case, the Borrower will, upon demand made by such Bank or
(as the case may be) the Agent at any time and from time to time and as often as
the occasion therefor may arise, pay to such Bank or the Agent such additional
amounts as will be sufficient to compensate such Bank or the Agent for such
additional cost, reduction, payment or foregone interest or Reimbursement
Obligation or other sum.
5.7. CAPITAL ADEQUACY. If after the date hereof any Bank or the Agent
determines that (i) the adoption of or change in any law, governmental rule,
regulation, policy, guideline or directive (whether or not having the force of
law) regarding capital requirements for banks or bank holding companies or any
change in the interpretation or application thereof by a court or governmental
authority with appropriate jurisdiction, or (ii) compliance by such Bank or the
Agent or any corporation controlling such Bank or the Agent with any law,
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law) of any such entity regarding capital adequacy, has the
effect of reducing the return on such Bank's or the Agent's commitment with
respect to any Loans to a level below that which such Bank or the Agent could
have achieved but for such adoption, change or compliance (taking into
consideration such Bank's or the Agent's then existing policies with respect to
capital adequacy and assuming full utilization of such entity's capital) by any
amount deemed by such Bank or (as the case may be) the Agent to be material,
then such Bank or the Agent may notify the Borrower of such fact. To the extent
that the amount of such reduction in the return on capital is not reflected in
the Base Rate, the Borrower agrees to pay such Bank or (as the case may be) the
Agent for the amount of such reduction in the return on capital as and when such
reduction is determined upon presentation by such Bank or (as the case may be)
the Agent of a certificate in accordance with ss.5.8 hereof. Each Bank shall
allocate such cost increases among its customers in good faith and on an
equitable basis.
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5.8. CERTIFICATE. A certificate setting forth any additional amounts
payable pursuant to secs. 5.6 or 5.7 and a brief explanation of such amounts
which are due, submitted by any Bank or the Agent to the Borrower, shall be
conclusive, absent manifest error, that such amounts are due and owing. The
Agent or any Bank which becomes aware that such amounts are due and owing shall
provide such Certificate to the Borrower within a reasonable period after
becoming so aware.
5.9. INDEMNITY. The Borrower agrees to indemnify each Bank and to hold
each Bank harmless from and against any loss, cost or expense (including loss of
anticipated profits) that such Bank may sustain or incur as a consequence of (i)
default by the Borrower in payment of the principal amount of or any interest on
any Eurodollar Rate Loans as and when due and payable, including any such loss
or expense arising from interest or fees payable by such Bank to lenders of
funds obtained by it in order to maintain its Eurodollar Rate Loans, (ii)
default by the Borrower in making a borrowing or conversion after the Borrower
has given (or is deemed to have given) a Loan Request or a Conversion Request
relating thereto in accordance with ss.2.6 or ss.2.7 or (iii) the making of any
payment of a Eurodollar Rate Loan or the making of any conversion of any such
Loan to a Base Rate Loan on a day that is not the last day of the applicable
Interest Period with respect thereto, including interest or fees payable by such
Bank to lenders of funds obtained by it in order to maintain any such Loans.
5.10. INTEREST AFTER DEFAULT.
5.10.1. OVERDUE AMOUNTS. Overdue principal and (to the extent
permitted by applicable law) interest on the Loans and all other
overdue amounts payable hereunder or under any of the other Loan
Documents shall bear interest compounded monthly and payable on
demand at a rate per annum equal to two percent (2%) above the
Base Rate until such amount shall be paid in full (after as well
as before judgment).
5.10.2. AMOUNTS NOT OVERDUE. During the continuance of a Default
or an Event of Default the principal of the Loans not overdue
shall, until such Default or Event of Default has been cured or
remedied or such Default or Event of Default has been waived by
the Majority Banks pursuant to ss.26, bear interest at a rate
per annum equal to the greater of (i) two percent (2%) above the
rate of interest otherwise applicable to such Loans pursuant to
ss.2.5 and (ii) the rate of interest applicable to overdue
principal pursuant to ss.5.10.1.
6. GUARANTIES.
The Obligations shall be guaranteed by each Guarantor pursuant to the
terms of the Guaranties.
7. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to the Banks and the Agent as
follows:
7.1. CORPORATE AUTHORITY.
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7.1.1. INCORPORATION; GOOD STANDING. Each of the Transaction
Parties (i) is a corporation duly organized, validly existing
and in good standing under the laws of its state of
incorporation, (ii) has all requisite corporate power to own its
property and conduct its business as now conducted, and (iii) is
in good standing as a foreign corporation and is duly authorized
to do business in each jurisdiction where such qualification is
necessary except where a failure to be so qualified would not
have a materially adverse effect on the business, assets or
financial condition of such Transaction Parties.
7.1.2. AUTHORIZATION. The execution, delivery and performance of
this Credit Agreement and the other Loan Documents to which any
of the Transaction Parties is or is to become a party and the
transactions contemplated hereby and thereby (a) are within the
corporate authority of such Person, (b) have been duly
authorized by all necessary corporate proceedings, including,
without limitation, any consents or approvals of shareholders of
the Borrower, (c) do not conflict with or result in any breach
or contravention of any provision of law, statute, rule or
regulation to which any of the Transaction Parties is subject
(including, without limitation, Regulations G, T, U or X of the
Board of Governors of the Federal Reserve System) or any
judgment, order, writ, injunction, license or permit applicable
to any of the Transaction Parties and (d) do not conflict with
any provision of the corporate charter or bylaws of, or any
agreement or other instrument binding upon, any of the
Transaction Parties.
7.1.3. ENFORCEABILITY. The execution and delivery of this Credit
Agreement and the other Loan Documents to which any of the
Transaction Parties is or is to become a party will result in
valid and legally binding obligations of such Person enforceable
against it in accordance with the respective terms and
provisions hereof and thereof, except as enforceability is
limited by bankruptcy, insolvency, reorganization, moratorium or
other laws relating to or affecting generally the enforcement of
creditors' rights and except to the extent that availability of
the remedy of specific performance or injunctive relief is
subject to the discretion of the court before which any
proceeding therefor may be brought.
7.2. GOVERNMENTAL APPROVALS. The execution, delivery and performance by
any of the Transaction Parties of this Credit Agreement and the other Loan
Documents to which any of the Transaction Parties is or is to become a party and
the transactions contemplated hereby and thereby do not require the approval or
consent of, or filing with, any governmental agency or authority other than
those already obtained or to be obtained in accordance with the requirements of
the Loan Documents.
7.3. TITLE TO PROPERTIES; LEASES. Except as indicated on SCHEDULE 7.3
hereto, the Borrower and its Subsidiaries own all of the assets reflected in the
consolidated balance sheet of the Borrower and its Subsidiaries or, as the case
may be, Zycon and its Subsidiaries, as at the Balance Sheet Date, or, as the
case may be, the Zycon Balance Sheet Date, or acquired since that date (except
property and assets sold or otherwise disposed of in the ordinary course of
business since that date), subject to no rights of others, including
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any mortgages, leases, conditional sales agreements, title retention agreements,
liens or other encumbrances except Permitted Liens.
7.4. FINANCIAL STATEMENTS, PROJECTIONS AND SOLVENCY.
7.4.1. FINANCIAL STATEMENTS. There has been furnished to each of
the Banks (a) a consolidated balance sheet of the Borrower and
its Subsidiaries as at the Balance Sheet Date, and a
consolidated statement of income of the Borrower and its
Subsidiaries for the fiscal year then ended, certified by Xxxxxx
Xxxxxxxx LLP, (b) a consolidated balance sheet of Zycon and its
Subsidiaries as at the Zycon Balance Sheet Date, and a
consolidated statement of income of Zycon and its Subsidiaries
for the portion of the fiscal year then ended, certified by
Xxxxxx Xxxxxxxx LLP, and (c) a consolidated balance sheet of the
Borrower and its Subsidiaries as at July 26, 1997, and a
Consolidated statement of income of the Borrower and its
Subsidiaries for the fiscal quarter then ended, prepared by the
Borrower. Such balance sheets and statements of income have been
prepared in accordance with generally accepted accounting
principles and fairly present the financial condition of the
Borrower or Zycon, as the case may be, as at the close of
business on the date thereof and the results of operations for
the fiscal year or fiscal quarter then ended. There are no
contingent liabilities of the Borrower or any of its
Subsidiaries as of the Balance Sheet Date, or of Zycon and its
Subsidiaries as of the Zycon Balance Sheet Date, involving
material amounts, known to the officers of the Borrower, which
were not disclosed in such balance sheets and the notes related
thereto.
7.4.2. PROJECTIONS. The projections of the annual operating
budgets of the Borrower and its Subsidiaries on a consolidated
basis, balance sheets and cash flow statements for the October,
1998 to October, 2002 fiscal years, copies of which have been
delivered to each Bank, disclose all assumptions made with
respect to general economic, financial and market conditions
used in formulating such projections. To the knowledge of the
Borrower or any of its Subsidiaries, no facts exist that
(individually or in the aggregate) would result in any material
change in any of such projections. The projections are based
upon reasonable estimates and assumptions, have been prepared on
the basis of the assumptions stated therein and reflect the
reasonable estimates of the Borrower and its Subsidiaries of the
results of operations and other information projected therein.
7.4.3. SOLVENCY. Each of the Transaction Parties, both before
and after giving effect to the transactions contemplated hereby,
is solvent (within the meaning contemplated by Section 548 of
Title 11 of the United States Code and any similar state statute
which may be applicable), has and will have assets having a fair
value in excess of the amount required to pay its probable
liabilities on its existing debts as they become absolute and
matured and has, and will have, access to adequate capital for
the conduct of its business and the ability to pay its debts
from time to time incurred in connection therewith as such debts
mature.
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7.5. NO MATERIAL CHANGES, ETC. Except as set forth on SCHEDULE 7.5
hereto, since the Balance Sheet Date, there has occurred no materially adverse
change in the financial condition or business of the Borrower and its
Subsidiaries, as shown on or reflected in the consolidated balance sheet of the
Borrower and its Subsidiaries as at the Balance Sheet Date, or, as the case may
be, of Zycon and its Subsidiaries as at the Zycon Balance Sheet Date, for the
year then ended, or the consolidated statements of income for the fiscal year of
the Borrower or, as the case may be, Zycon then ended, other than changes in the
ordinary course of business that have not had any materially adverse effect,
either individually or in the aggregate, on the business or financial condition
of the Borrower and its Subsidiaries, considered as a whole. Since the Balance
Sheet Date, neither the Borrower nor any of its Subsidiaries has made any
Distribution other than the Zycon Employee Distribution.
7.6. FRANCHISES, PATENTS, COPYRIGHTS, ETC. Each of the Transaction
Parties possesses all franchises, patents, copyrights, trademarks, trade names,
licenses and permits, and rights in respect of the foregoing, adequate for the
conduct of its business substantially as now conducted without known conflict
with any rights of others.
7.7. LITIGATION. Except as set forth in SCHEDULE 7.7 hereto, there are
no actions, suits, proceedings or investigations of any kind pending or
threatened against any of the Transaction Parties, before any court, tribunal or
administrative agency or board that, if adversely determined, might, either in
any case or in the aggregate, materially adversely affect the properties,
assets, financial condition or business of the Transaction Parties, considered
as a whole, or materially impair the right of the Transaction Parties,
considered as a whole, to carry on business substantially as now conducted by
them, or result in any substantial liability not adequately covered by
insurance, or for which adequate reserves are not maintained on the consolidated
balance sheet of the Borrower and its Subsidiaries, or which question the
validity of this Credit Agreement or any of the other Loan Documents, or any
action taken or to be taken pursuant hereto or thereto.
7.8. NO MATERIALLY ADVERSE CONTRACTS, ETC. None of the Transaction
Parties is subject to any charter, corporate or other legal restriction, or any
judgment, decree, order, rule or regulation that has or is expected in the
future to have a materially adverse effect on the business, assets or financial
condition of such Transaction Party or on such Transaction Party's ability to
perform its obligations under the Loan Documents to which it is a party. Except
as set forth on SCHEDULE 7.5 hereto, none of the Transaction Parties is a party
to any contract or agreement that has or is expected, in the judgment of the
Borrower's officers, to have any materially adverse effect on the business of
such Transaction Party.
7.9. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. None of the
Transaction Parties is in violation of any provision of its charter documents,
bylaws, or any agreement or instrument to which it may be subject or by which it
or any of its properties may be bound or any decree, order, judgment, statute,
license, rule or regulation, in any of the foregoing cases in a manner that
could, except as otherwise set forth on SCHEDULE 7.17, result in the imposition
of substantial penalties or materially and adversely affect the financial
condition, properties or business of such Transaction Party.
7.10. TAX STATUS. The Transaction Parties (a) except as set forth in
SCHEDULE 7.10 hereto, have made or filed all federal and state income and all
other tax returns, reports and declarations required by any jurisdiction to
which any of them is subject, (b) have paid all
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taxes and other governmental assessments and charges shown or determined to be
due on such returns, reports and declarations, except those being contested in
good faith and by appropriate proceedings and (c) have set aside on their books
provisions reasonably adequate for the payment of all taxes for periods
subsequent to the periods to which such returns, reports or declarations apply.
There are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and the officers of the Borrower know of no basis
for any such claim. None of the Transaction Parties has consented or will
consent to be treated as a "consenting corporation" as defined in Section 341 of
the Code.
7.11. NO EVENT OF DEFAULT. No Default or Event of Default has occurred
and is continuing.
7.12. HOLDING COMPANY AND INVESTMENT COMPANY ACTS. None of the
Transaction Parties is a "holding company", or a "subsidiary company" of a
"holding company", or an "affiliate" of a "holding company", as such terms are
defined in the Public Utility Holding Company Act of 1935; nor is it an
"investment company", or an "affiliated company" or a "principal underwriter" of
an "investment company", as such terms are defined in the Investment Company Act
of 1940.
7.13. ABSENCE OF FINANCING STATEMENTS. Except with respect to Permitted
Liens, there is no financing statement, security agreement, chattel mortgage,
real estate mortgage or other document filed or recorded with any filing
records, registry or other public office, that purports to cover, affect or give
notice of any present or possible future lien on, or security interest in, any
assets or property of any of the Transaction Parties or any rights relating
thereto.
7.14. CERTAIN TRANSACTIONS. Except for arm's length transactions
pursuant to which any of the Transaction Parties makes payments in the ordinary
course of business upon terms no less favorable than any of the Transaction
Parties could obtain from third parties, none of the officers, directors, or
employees of any of the Transaction Parties is presently a party to any
transaction with any of the Transaction Parties (other than for services as
employees, officers and directors), including any contract, agreement or other
arrangement providing for the furnishing of services to or by, providing for
rental of real or personal property to or from, or otherwise requiring payments
to or from any officer, director or such employee or, to the knowledge of the
Borrower, any corporation, partnership, trust or other entity in which any
officer, director, or any such employee has a substantial interest or is an
officer, director, trustee or partner.
7.15. EMPLOYEE BENEFIT PLANS.
7.15.1. IN GENERAL. Each Employee Benefit Plan and each
Guaranteed Pension Plan has been maintained and operated in
compliance in all material respects with the provisions of ERISA
and, to the extent applicable, the Code, including but not
limited to the provisions thereunder respecting prohibited
transactions and the bonding of fiduciaries and other persons
handling plan funds as required by ss.412 of ERISA. The Borrower
has heretofore delivered to the Agent the most recently
completed annual report, Form 5500, with all required
attachments, and actuarial statement required
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to be submitted under ss.103(d) of ERISA, with respect to each
Guaranteed Pension Plan.
7.15.2. TERMINABILITY OF WELFARE PLANS. No Employee Benefit Plan
which is an employee welfare benefit plan within the meaning of
ss.3(1) or ss.3(2)(B) of ERISA provides benefit coverage
subsequent to termination of employment except as required by
Title I, Part 6 of ERISA or applicable state insurance laws. The
Borrower may terminate each such Plan at any time (or at any
time subsequent to the expiration of any applicable bargaining
agreement) in the discretion of the Borrower without liability
to any Person other than for claims arising prior to
termination.
7.15.3. GUARANTEED PENSION PLANS. Each contribution required to
be made to a Guaranteed Pension Plan, whether required to be
made to avoid the incurrence of an accumulated funding
deficiency, the notice or lien provisions of ss.302(f) of ERISA,
or otherwise, has been timely made. No waiver of an accumulated
funding deficiency or extension of amortization periods has been
received with respect to any Guaranteed Pension Plan, and
neither the Borrower nor any ERISA Affiliate is obligated to or
has posted security in connection with an amendment of a
Guaranteed Pension Plan pursuant to ss.307 of ERISA or
ss.401(a)(29) of the Code. No liability to the PBGC (other than
required insurance premiums, all of which have been paid) has
been incurred by the Borrower or any ERISA Affiliate with
respect to any Guaranteed Pension Plan and there has not been
any ERISA Reportable Event, or any other event or condition
which presents a material risk of termination of any Guaranteed
Pension Plan by the PBGC. Based on the latest valuation of each
Guaranteed Pension Plan (which in each case occurred within
twelve months of the date of this representation), and on the
actuarial methods and assumptions employed for that valuation,
the aggregate benefit liabilities of all such Guaranteed Pension
Plans within the meaning of ss.4001 of ERISA did not exceed the
aggregate value of the assets of all such Guaranteed Pension
Plans, disregarding for this purpose the benefit liabilities and
assets of any Guaranteed Pension Plan with assets in excess of
benefit liabilities.
7.15.4. MULTIEMPLOYER PLANS. Neither the Borrower nor any ERISA
Affiliate has incurred any material liability (including
secondary liability) to any Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan
under ss.4201 of ERISA or as a result of a sale of assets
described in ss.4204 of ERISA. Neither the Borrower nor any
ERISA Affiliate has been notified that any Multiemployer Plan is
in reorganization or insolvent under and within the meaning of
ss.4241 or ss.4245 of ERISA or is at risk of entering
reorganization or becoming insolvent, or that any Multiemployer
Plan intends to terminate or has been terminated under ss.4041A
of ERISA.
7.16. USE OF PROCEEDS. The proceeds of the Loans shall be used for
refinancing of existing indebtedness of the Borrower under the Original Credit
Agreement to BKB and the other lenders party thereto, for acquisitions permitted
by the terms hereof and for working
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capital and general corporate purposes. The Borrower will obtain Letters of
Credit solely for general corporate purposes. No portion of any Loan is to be
used, and no portion of any Letter of Credit is to be obtained, for the purpose
of purchasing or carrying any Margin Stock, except in compliance with
Regulations U and X of the Board of Governors of the Federal Reserve System, 12
C.F.R. Parts 221 and 224.
7.17. ENVIRONMENTAL COMPLIANCE. The Borrower has taken all reasonable
steps to investigate the past and present condition and usage of the Real Estate
and the operations conducted thereon and, except as set forth in SCHEDULE 7.17
attached hereto, has determined that:
(a) none of the Transaction Parties or any operator of the Real
Estate or any operations thereon is in violation, or alleged violation,
of any judgment, decree, order, law, license, rule or regulation
pertaining to environmental matters, including without limitation,
those arising under the Resource Conservation and Recovery Act
("RCRA"), the Comprehensive Environmental Response, Compensation and
Liability Act of 1980 as amended ("CERCLA"), the Superfund Amendments
and Reauthorization Act of 1986 ("XXXX"), the Federal Clean Water Act,
the Federal Clean Air Act, the Toxic Substances Control Act, or any
state or local statute, regulation, ordinance, order or decree relating
to health, safety or the environment (hereinafter "Environmental
Laws"), which violation would have a material adverse effect on the
business, assets or financial condition of the Transaction Parties,
considered as a whole;
(b) none of the Transaction Parties has received notice from any
third party including, without limitation, any federal, state or local
governmental authority, (i) that any one of them has been identified by
the United States Environmental Protection Agency ("EPA") as a
potentially responsible party under CERCLA with respect to a site
listed on the National Priorities List, 40 C.F.R. Part 000 Xxxxxxxx X;
(ii) that any hazardous waste, as defined by 42 U.S.C. ss.6903(5), any
hazardous substances as defined by 42 U.S.C. ss.9601(14), any pollutant
or contaminant as defined by 42 U.S.C. ss.9601(33) and any toxic
substances, oil or hazardous materials or other chemicals or substances
regulated by any Environmental Laws ("Hazardous Substances") which any
one of them has generated, transported or disposed of has been found at
any site at which a federal, state or local agency or other third party
has conducted or has ordered that the Transaction Parties conduct a
remedial investigation, removal or other response action pursuant to
any Environmental Law; or (iii) that it is or shall be a named party to
any claim, action, cause of action, complaint, or legal or
administrative proceeding (in each case, contingent or otherwise)
arising out of any third party's incurrence of costs, expenses, losses
or damages of any kind whatsoever in connection with the release of
Hazardous Substances;
(c) except to the extent that any of the following would not
have a material adverse effect on the value of the Real Estate or the
business, assets or financial condition of the Transaction Parties,
considered as a whole: (i) no portion of the Real Estate has been used
for the handling, processing, storage or disposal of Hazardous
Substances except in accordance with applicable Environmental Laws; and
no underground tank or other underground storage receptacle for
Hazardous
39
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Substances is located on any portion of the Real Estate; (ii) in the
course of any activities conducted by and of the Transaction Parties or
operators of its or their properties, no Hazardous Substances have been
generated or are being used on the Real Estate except in accordance
with applicable Environmental Laws; (iii) there have been no releases
(i.e. any past or present releasing, spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, escaping,
disposing or dumping) or threatened releases of Hazardous Substances
on, upon, into or from the properties of the Transaction Parties; (iv)
to the best of the Borrower's knowledge, there have been no releases
on, upon, from or into any real property in the vicinity of any of the
Real Estate which, through soil or groundwater contamination, may have
come to be located on the Real Estate; and (v) in addition, any
Hazardous Substances that have been generated on any of the Real Estate
have been transported offsite only by carriers having an identification
number issued by the EPA or by carriers not required by law to have
such identification numbers, treated or disposed of only by treatment,
recycling or disposal facilities maintaining valid permits as required
under applicable Environmental Laws, which transporters and facilities
have been and are, to the best of the Borrower's knowledge, operating
in compliance with such permits and applicable Environmental Laws; and
(d) Except with respect to matters that would not have a
material adverse effect on the value of the Real Estate or the
business, assets or financial condition of the Transaction Parties,
considered as a whole, none of the Transaction Parties or any of the
Real Estate is subject to any applicable environmental law requiring
the performance of Hazardous Substances site assessments, or the
removal or remediation of Hazardous Substances, or the giving of notice
to any governmental agency or the recording or delivery to other
Persons of an environmental disclosure document or statement by virtue
of the transactions set forth herein and contemplated hereby, or as a
condition to the effectiveness of any of the transactions contemplated
hereby or the other Loan Documents.
7.18. SUBSIDIARIES, ETC. Hadco Santa Xxxxx, New Zycon and Hadco FSC are
the only direct Subsidiaries of the Borrower. Hadco Malaysia is the only
Subsidiary of Hadco Santa Xxxxx. Neither New Zycon nor Hadco FSC has any
Subsidiaries. Except as set forth on SCHEDULE 7.18 hereto, none of the
Transaction Parties is engaged in any joint venture or partnership with any
other Person.
7.19. DISCLOSURE. The representations and warranties made by the
Transaction Parties in this Credit Agreement or in any agreement, instrument,
document, certificate, statement or letter furnished to the Banks on behalf of
any of the Transaction Parties in connection with the transactions contemplated
by the Loan Documents do not, taken as a whole, together with all other
information provided by the Borrower in connection with the transactions
contemplated by the Loan Documents, contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
contained herein or therein not misleading. There is no fact known to the
Borrower which materially adversely affects, or which is likely in the future to
materially adversely affect, the business, assets or financial condition of the
Transaction Parties, taken as a whole.
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8. AFFIRMATIVE COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit or Note is outstanding or any Bank
has any obligation to make any Loans or the Agent has any obligation to issue,
extend or renew any Letters of Credit:
8.1. PUNCTUAL PAYMENT. The Borrower will duly and punctually pay or
cause to be paid the principal and interest on the Loans, all Reimbursement
Obligations, the Letter of Credit Fees, the commitment fees, the Agent's fee and
all other amounts provided for in this Credit Agreement and the other Loan
Documents to which any of the Transaction Parties is a party, all in accordance
with the terms of this Credit Agreement and such other Loan Documents.
8.2. MAINTENANCE OF OFFICE. The Borrower will maintain its chief
executive office in Salem, New Hampshire, or at such other place in the United
States of America as the Borrower shall designate upon written notice to the
Agent, where notices, presentations and demands to or upon the Borrower in
respect of the Loan Documents to which the Borrower is a party may be given or
made.
8.3. RECORDS AND ACCOUNTS. The Borrower will (i) keep, and cause each
of the other Transaction Parties to keep, true and accurate records and books of
account in which full, true and correct entries will be made in accordance with
generally accepted accounting principles, (ii) maintain adequate accounts and
reserves for all taxes (including income taxes), depreciation, depletion,
obsolescence and amortization of its properties and the properties of the other
Transaction Parties, contingencies, and other reserves, and (iii) will at all
times have engaged Xxxxxx Xxxxxxxx LLP or other independent certified public
accountants satisfactory to the Agent as its accountants, with no more than
thirty (30) days elapsing between the termination of any such accountants as the
Borrower's accountants and the engagement of successor accountants satisfactory
to the Agent.
8.4. FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION. The Borrower
will deliver to each of the Banks:
(a) as soon as practicable, but in any event not later than
ninety (90) days after the end of each fiscal year of the Borrower, the
consolidated balance sheet of the Borrower and its Subsidiaries and the
consolidating balance sheet of the Borrower and its Subsidiaries, each
as at the end of such year, and the related consolidated statement of
income and consolidated statement of cash flow and consolidating
statement of income and consolidating statement of cash flow for such
year, each setting forth in comparative form the figures for the
previous fiscal year and all such consolidated and consolidating
statements to be in reasonable detail, prepared in accordance with
generally accepted accounting principles, and certified without
qualification by Xxxxxx Xxxxxxxx LLP or by other independent certified
public accountants satisfactory to the Agent, together with a written
statement from such accountants to the effect that they have read a
copy of this Credit Agreement, and that, in making the examination
necessary to said certification, they have obtained no knowledge of any
Default or Event of Default, or, if such accountants shall have
obtained knowledge of any then existing Default or Event of Default
they
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shall disclose in such statement any such Default or Event of Default;
PROVIDED that such accountants shall not be liable to the Banks for
failure to obtain knowledge of any Default or Event of Default;
(b) as soon as practicable, but in any event not later than
forty-five (45) days after the end of each of the fiscal quarters of
the Borrower, copies of the unaudited consolidated balance sheet of the
Borrower and its Subsidiaries and the unaudited consolidating balance
sheet of the Borrower and its Subsidiaries, each as at the end of such
quarter, and the related consolidated statement of income and
consolidated statement of cash flow and consolidating statement of
income and consolidating statement of cash flow for the portion of the
Borrower's fiscal year then elapsed, all in reasonable detail and
prepared in accordance with generally accepted accounting principles,
together with a certification by the principal financial or accounting
officer of the Borrower that the information contained in such
financial statements fairly presents the financial position of the
Borrower and its Subsidiaries on the date thereof (subject to year-end
adjustments);
(c) simultaneously with the delivery of the financial statements
referred to in subsections (a) and (b) above, a statement certified by
the principal financial or accounting officer of the Borrower in
substantially the form of EXHIBIT C hereto and setting forth in
reasonable detail computations evidencing compliance with the covenants
contained in ss.10 and (if applicable) reconciliations to reflect
changes in generally accepted accounting principles since the Balance
Sheet Date;
(d) contemporaneously with the filing or mailing thereof, copies
of all material of a financial nature, all reports, proxy statements
and notices filed by any of the Transaction Parties with the Securities
and Exchange Commission or sent to the stockholders of the Borrower;
(e) from time to time upon request of the Agent, projections of
the Borrower and its Subsidiaries updating those projections delivered
to the Banks and referred to in ss.7.4.2 or, if applicable, updating
any later such projections delivered in response to a request pursuant
to this ss.8.4(e); and
(f) from time to time such other financial data and information
(including accountants management letters) regarding the financial and
other affairs of the Borrower and its Subsidiaries as the Agent or any
Bank may reasonably request.
8.5. NOTICES.
8.5.1. DEFAULTS. The Borrower will promptly notify the Agent and
each of the Banks in writing of the occurrence of any Default or
Event of Default. If any Person shall give any notice or take
any other action in respect of a claimed default (whether or not
constituting an Event of Default) under this Credit Agreement or
any other note, evidence of indebtedness, indenture or other
obligation to which or with respect to which the Borrower or any
of the other Transaction Parties is a party or obligor, whether
as principal, guarantor, surety or otherwise, the Borrower shall
forthwith give written
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notice thereof to the Agent and each of the Banks, describing
the notice or action and the nature of the claimed default.
8.5.2. ENVIRONMENTAL EVENTS. The Borrower will promptly give
notice to the Agent and each of the Banks (i) of any violation
of any Environmental Law that the Borrower or any of the other
Transaction Parties reports in writing or is reportable by such
Person in writing (or for which any written report supplemental
to any oral report is made) to any federal, state or local
environmental agency and (ii) upon becoming aware thereof, of
any inquiry, proceeding, investigation, or other action,
including a notice from any agency of potential environmental
liability, of any federal, state or local environmental agency
or board, that has the potential to materially affect the
assets, liabilities, financial condition or operations of the
Borrower and any of the other Transaction Parties, considered as
a whole.
8.5.3. NOTICE OF LITIGATION AND JUDGMENTS. The Borrower will,
and will cause each of the other Transaction Parties to, give
notice to the Agent and each of the Banks in writing within
fifteen (15) days of becoming aware of any litigation or
proceedings threatened in writing or any pending litigation and
proceedings affecting the Borrower or any of the other
Transaction Parties or to which the Borrower or any of the other
Transaction Parties is or becomes a party (including, without
limitation, any shareholder derivative suit) that could
reasonably be expected to have a material adverse effect upon
the consummation of the transactions contemplated hereby or
involving an uninsured claim against the Borrower or any of the
other Transaction Parties that could reasonably be expected to
have a materially adverse effect on the Borrower or any of the
other Transaction Parties and stating the nature and status of
such litigation or proceedings. The Borrower will, and will
cause each of the other Transaction Parties to, give notice to
the Agent and each of the Banks, in writing, in form and detail
satisfactory to the Agent, within ten (10) days of any judgment
not covered by insurance, final or otherwise, against the
Borrower or any of the other Transaction Parties in an amount in
excess of $5,000,000.
8.6. CORPORATE EXISTENCE; MAINTENANCE OF PROPERTIES. The Borrower will
do or cause to be done all things necessary to preserve and keep in full force
and effect its corporate existence, rights and franchises and those of the other
Transaction Parties and will not, and will not cause or permit any of the other
Transaction Parties to, convert to a limited liability company or limited
liability partnership. The Borrower (i) will cause all of its properties and
those of the other Transaction Parties used or useful in the conduct of its
business or the business of the other Transaction Parties to be maintained and
kept in good condition, repair and working order and supplied with all necessary
equipment, (ii) will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Borrower may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times, and (iii)
will, and will cause each of the other Transaction Parties to, continue to
engage primarily in the businesses now conducted by them and in related
businesses; PROVIDED that nothing in this ss.8.6 shall prevent the Borrower from
discontinuing the operation and maintenance of any of its properties or any of
those of the other Transaction
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Parties if such discontinuance is, in the judgment of the Borrower, desirable in
the conduct of its or their business and that do not in the aggregate materially
adversely affect the business of the Borrower and the other Transaction Parties,
considered as a whole.
8.7. INSURANCE. The Borrower will, and will cause each of the other
Transaction Parties to, maintain with financially sound and reputable insurers
insurance with respect to its properties and business against such casualties
and contingencies as shall be in accordance with the general practices of
businesses engaged in similar activities in similar geographic areas and in
amounts, containing such terms, in such forms and for such periods as may be
reasonable and prudent and in accordance with the terms hereof.
8.8. TAXES. The Borrower will, and will cause each of the other
Transaction Parties to, duly pay and discharge, or cause to be paid and
discharged, before the same shall become overdue, all taxes, assessments and
other governmental charges imposed upon it and its real properties, sales and
activities, or any part thereof, or upon the income or profits therefrom, as
well as all claims for labor, materials, or supplies that if unpaid might by law
become a lien or charge upon any of its property; PROVIDED that any such tax,
assessment, charge, levy or claim need not be paid if the validity or amount
thereof shall currently be contested in good faith by appropriate proceedings
and if the Borrower or such other Transaction Party shall have set aside on its
books adequate reserves with respect thereto; and PROVIDED FURTHER that the
Borrower and each other Transaction Party will pay all such taxes, assessments,
charges, levies or claims forthwith upon the commencement of proceedings to
foreclose any lien that may have attached as security therefor.
8.9. INSPECTION OF PROPERTIES AND BOOKS, ETC.
8.9.1. GENERAL. The Borrower shall permit the Banks, through the
Agent or any of the Banks' other designated representatives, to
visit and inspect any of the properties of the Borrower or any
of the other Transaction Parties, to conduct commercial finance
examinations of the Borrower and the other Transaction Parties,
to examine the books of account of the Borrower and the other
Transaction Parties (and to make copies thereof and extracts
therefrom), and to discuss the affairs, finances and accounts of
the Borrower and the other Transaction Parties with, and to be
advised as to the same by, its and their officers, all at such
reasonable times and intervals as the Agent or any Bank may
reasonably request.
8.9.2. COMMUNICATIONS WITH ACCOUNTANTS. The Borrower authorizes
the Agent and, if accompanied by the Agent, the Banks to
communicate directly with the Borrower's independent certified
public accountants and authorizes such accountants to disclose
to the Agent and the Banks any and all financial statements and
other supporting financial documents and schedules including
copies of any management letter with respect to the business,
financial condition and other affairs of the Borrower or any of
the other Transaction Parties. At the request of the Agent, the
Borrower shall deliver a letter addressed to such accountants
instructing them to comply with the provisions of this ss.8.9.2.
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8.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS. The
Borrower will, and will cause each of the other Transaction Parties to, comply
with (i) in all material respects, the applicable laws and regulations wherever
its business is conducted, including all Environmental Laws, (ii) the provisions
of its charter documents and by-laws, (iii) all agreements and instruments by
which it or any of its properties may be bound and (iv) all applicable decrees,
orders, and judgments. If any authorization, consent, approval, permit or
license from any officer, agency or instrumentality of any government shall
become necessary or required in order that the Borrower or any of the other
Transaction Parties may fulfill any of its obligations hereunder or any of the
other Loan Documents to which the Borrower or such other Transaction Party is a
party, the Borrower will, or (as the case may be) will cause such other
Transaction Party to, immediately take or cause to be taken all reasonable steps
within the power of the Borrower or such other Transaction Party to obtain such
authorization, consent, approval, permit or license and furnish the Agent and
the Banks with evidence thereof.
8.11. EMPLOYEE BENEFIT PLANS. The Borrower will (i) promptly upon
request of the Agent, furnish to the Agent a copy of the most recent actuarial
statement required to be submitted under ss.103(d) of ERISA and Annual Report,
Form 5500, with all required attachments, in respect of eacH Guaranteed Pension
Plan and (ii) promptly upon receipt or dispatch, furnish to the Agent any
notice, report or demand sent or received in respect of a Guaranteed Pension
Plan under ss.ss.302, 4041, 4042, 4043, 4063, 4065, 4066 and 4068 of ERISA, or
in respect of a Multiemployer Plan, under ss.ss.4041A, 4202, 4219, 4242, or 4245
of ERISA.
8.12. USE OF PROCEEDS.
8.12.1. GENERAL. The Borrower will use the proceeds of the Loans
solely for refinancing of existing indebtedness of the Borrower under
the Original Credit Agreement to BKB and the other lenders party
thereto, for acquisitions permitted by the terms hereof and for working
capital and general corporate purposes. The Borrower will obtain
Letters of Credit solely for general corporate purposes.
8.12.2. REGULATIONS U AND X. No portion of any Loan is to be
used, and no portion of any Letter of Credit is to be obtained, for the
purpose of purchasing or carrying any Margin Stock in violation of
Regulations U and X of the Board of Governors of the Federal Reserve
System, 12 C.F.R. Parts 221 and 224.
8.12.3. INELIGIBLE SECURITIES. No portion of the proceeds of any
Loan is to be used, and no portion of any Letter of Credit is to be
obtained, for the purpose of (a) knowingly purchasing, or providing
credit support for the purchase of, Ineligible Securities from a
Section 20 Subsidiary during any period in which such Section 20
Subsidiary makes a market in such Ineligible Securities, (b) knowingly
purchasing, or providing credit support for the purchase of, during the
underwriting or placement period, any Ineligible Securities being
underwritten or privately placed by a Section 20 Subsidiary, or (c)
making, or providing credit support for the making of, payments of
principal or interest on Ineligible Securities underwritten or
privately placed by a Section 20 Subsidiary and issued by or for the
benefit of the Borrower or the Guarantor or other Affiliate of the
Borrower.
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8.13. INTEREST RATE PROTECTION AGREEMENTS. The Borrower shall (a) until
January 8, 1998, maintain, upon terms and conditions satisfactory in form and
substance to the Agent, interest rate protection agreements with a minimum
notional amount of $75,000,000, and (b) at any time when the amount of Loans
outstanding (after giving effect to all amounts requested) PLUS the Maximum
Drawing Amount and all Unpaid Reimbursement Obligations exceeds $150,000,000,
enter into and maintain, upon terms and conditions satisfactory in form and
substance to the Agent, interest rate protection agreements with a minimum
notional amount (the "Additional Notional Amount") equal to at least thirty
percent (30%) of the amount of Loans outstanding PLUS the Maximum Drawing Amount
and all Unpaid Reimbursement Obligations at such time; PROVIDED, HOWEVER, that,
in the event that the Borrower incurs Indebtedness permitted by ss.9.1(k), which
Indebtedness bears interest at a fixed, rather than a floating, rate, the
Borrower shalL maintain such interest rate protection arrangements with respect
to a minimum notional amount equal to the difference of (x)(i) until January 8,
1998, $75,000,000 PLUS (ii) the Additional Notional Amount MINUS (y) the amount
of such permitted fixed rate Indebtedness.
8.14. FURTHER ASSURANCES. The Borrower will, and will cause each of the
other Transaction Parties to, cooperate with the Banks and the Agent and execute
such further instruments and documents as the Banks or the Agent shall
reasonably request to carry out to their satisfaction the transactions
contemplated by this Credit Agreement and the other Loan Documents.
9. CERTAIN NEGATIVE COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit or Note is outstanding or any Bank
has any obligation to make any Loans or the Agent has any obligations to issue,
extend or renew any Letters of Credit:
9.1. RESTRICTIONS ON INDEBTEDNESS. The Borrower will not, and will not
permit any of the other Transaction Parties to, create, incur, assume, guarantee
or be or remain liable, contingently or otherwise, with respect to any
Indebtedness other than:
(a) Indebtedness to the Banks and the Agent arising under any of
the Loan Documents;
(b) current liabilities of the Borrower or the other Transaction
Parties incurred in the ordinary course of business not incurred
through (i) the borrowing of money, or (ii) the obtaining of credit
except for credit on an open account basis customarily extended and in
fact extended in connection with normal purchases of goods and
services;
(c) Indebtedness in respect of taxes, assessments, governmental
charges or levies and claims for labor, materials and supplies to the
extent that payment therefor shall not at the time be required to be
made in accordance with the provisions of ss.8.8;
(d) Indebtedness in respect of judgments or awards that have
been in force for less than the applicable period for taking an appeal
so long as execution is not
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levied thereunder or in respect of which the Borrower or such other
Transaction Party shall at the time in good faith be prosecuting an
appeal or proceedings for review and in respect of which a stay of
execution shall have been obtained pending such appeal or review;
(e) endorsements for collection, deposit or negotiation and
warranties of products or services, in each case incurred in the
ordinary course of business;
(f) obligations under Capitalized Leases which, when combined
with amounts outstanding under ss.9.1(g), do not exceed $50,000,000 in
aggregate amount at any time outstanding;
(g) Indebtedness incurred in connection with the acquisition
after the date hereof of any real or personal property by the Borrower
or such other Transaction Party, PROVIDED that the aggregate principal
amount of such Indebtedness of the Borrower and the other Transaction
Parties shall, when combined with amounts outstanding under ss.9.1(f)
not exceed the aggregate amount of $50,000,000 at any one time;
(h) Indebtedness of the Borrower and the other Transaction
Parties existing on the date hereof and listed and described on
SCHEDULE 9.1 hereto;
(i) Indebtedness of (i) a Guarantor, following its execution and
delivery of its Guaranty to the Agent, to the Borrower; (ii) Hadco FSC
to the Borrower in an aggregate amount not to exceed $2,000,000; (iii)
Hadco Malaysia to the Borrower in an aggregate amount not to exceed
$55,000,000, no more than $25,000,000 of which may be incurred in any
one fiscal year of the Borrower; PROVIDED, HOWEVER, that if during any
fiscal year the amount of such Indebtedness permitted for that fiscal
year is not so utilized, such unutilized amount may be utilized in the
next succeeding fiscal year; and (iv) New Zycon to the Borrower in an
aggregate amount not to exceed $50,000;
(j) Indebtedness consisting of contingent obligations arising in
connection with any Transaction Party's compliance with applicable
Environmental Laws in an amount not to exceed in the aggregate
$20,000,000;
(k) so long as no Default or Event of Default shall have
occurred and be continuing or would occur as a result of the incurrence
of any thereof, unsecured Indebtedness of the Borrower or any of the
Guarantors up to an aggregate amount (the "ADDITIONAL AMOUNT") equal to
the amount of $175,000,000, consisting of: (i) up to an amount equal to
$150,000,000 (but not to exceed, when combined with amounts of
Indebtedness incurred pursuant to clause (ii) of this ss.9.1(k), the
Additional Amount) of Indebtedness which is expressly subordinated and
made junior to the payment and performance in full of the Obligations;
and (ii) up to $150,000,000 (but not to exceed, when combined with
amounts of Indebtedness incurred pursuant to clause (i) of this
ss.9.1(k), the Additional Amount) of Indebtedness which may rank PARI
PASSU with the Obligations; PROVIDED, HOWEVER, that the terms of
Indebtedness permitted pursuant to this ss.9.1(k) shalL include the
following:
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(A) the maturity date of any such Indebtedness occurs at
least one hundred twenty (120) days following the Revolving
Credit Loan Maturity Date;
(B) with respect to subordinated Indebtedness described in
clause (i) of this ss.9.1(k), no principal, interest, fees or
other amounts with respect thereto are due and payable upon the
occurrence and during the continuance of a Default or Event of
Default;
(C) with respect to subordinated Indebtedness described in
clause (i) of this ss.9.1(k), no principal or sinking fund
payments are due prior to at least one hundred twenty (120) days
following the Revolving Credit Loan Maturity Date;
(D) the rate of interest and other fees applicable to such
Indebtedness are, in the reasonable judgment of the Agent and
the Majority Banks, a market rate for companies with the same or
a similar financial profile as the Borrower;
(E) the covenants, including affirmative, negative and
financial covenants, included therein are, in the reasonable
judgment of the Agent and the Majority Banks, less restrictive
than the covenants set forth in ss.ss.8, 9 and 10 hereof and do
Not contain a negative pledge on assets of the Borrower and the
other Transaction Parties (but may, with respect to PARI PASSU
Indebtedness described in clause (ii) of this ss.9.1(k), contain
an "equal and ratable clause" with respect to any collateral
obtained by the Agent and the Banks);
(F) the terms and conditions of which may not be amended
without the prior written consent of the Agent and the Majority
Banks;
(G) default provisions with respect to which do not
cross-default to the Credit Agreement and the other Loan
Documents, except that, with respect to PARI PASSU Indebtedness
described in clause (ii) of this ss.9.1(k), such default
provisions may cross-default to a Default or Event of Default
under ss.13.1(a) or (b), to the extent that any such Default or
Event of Default is not cured or waived within thirty (30) days
after the occurrence thereof;
(H) subordinated Indebtedness described in clause (i) of
this ss.9.1(k) shall be expressly subordinated and made junior
to the payment and performance in full of the Obligations owed
by the Borrower or, as the case may be, the Guarantor issuing
such subordinated Indebtedness, as evidenced as subordinate by a
Subordination and Intercreditor Agreement or other written
instrument containing subordination provisions in form and
substance satisfactory to (in their sole and absolute
discretion) and approved by the Agent and the Majority Banks in
writing; and
(I) such other terms and conditions as the Agent and the
Majority Banks may reasonably require;
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PROVIDED, FURTHER, that prior to the incurrence of any such
Indebtedness, the Borrower shall provide to the Agent and each of the
Banks PRO FORMA financial statements and compliance certificates in the
form of EXHIBIT C indicating that for the period from the date of the
incurrence of such Indebtedness until the Revolving Credit Loan
Maturity Date, no Default or Event of Default would result from the
incurrence of such Indebtedness; and
(l) Indebtedness not otherwise set forth in clauses (a) - (k) of
this ss.9.1 in an amount not to exceed $2,000,000 in the aggregate.
9.2. RESTRICTIONS ON LIENS. The Borrower will not, and will not permit
any of the other Transaction Parties to, (i) create or incur or suffer to be
created or incurred or to exist any lien, encumbrance, mortgage, pledge, charge,
restriction or other security interest of any kind upon any of its property or
assets of any character whether now owned or hereafter acquired, or upon the
income or profits therefrom; (ii) transfer any of such property or assets or the
income or profits therefrom for the purpose of subjecting the same to the
payment of Indebtedness or performance of any other obligation in priority to
payment of its general creditors; (iii) acquire, or agree or have an option to
acquire, any property or assets upon conditional sale or other title retention
or purchase money security agreement, device or arrangement; (iv) suffer to
exist for a period of more than sixty (60) days after the same shall have been
incurred any Indebtedness or claim or demand against it that if unpaid might by
law or upon bankruptcy or insolvency, or otherwise, be given any priority
whatsoever over its general creditors; or (v) sell, assign, pledge or otherwise
transfer any accounts, contract rights, general intangibles, chattel paper or
instruments, with or without recourse; PROVIDED that the Borrower and any of the
other Transaction Parties may create or incur or suffer to be created or
incurred or to exist:
(a) liens in favor of the Borrower on all or part of the assets
of any of the other Transaction Parties securing Indebtedness permitted
by ss.9.1 and owing by such other Transaction Parties to the Borrower;
(b) liens to secure taxes, assessments and other government
charges in respect of obligations not overdue or liens on properties to
secure claims for labor, material or supplies in respect of obligations
not overdue;
(c) deposits or pledges made in connection with, or to secure
payment of, workmen's compensation, unemployment insurance, old age
pensions or other social security obligations;
(d) liens on properties in respect of judgments or awards, the
Indebtedness with respect to which is permitted by ss.9.1(d);
(e) liens of carriers, warehousemen, mechanics and materialmen,
and other like liens on properties in existence less than 120 days from
the date of creation thereof in respect of obligations not overdue;
(f) encumbrances on Real Estate consisting of easements, rights
of way, zoning restrictions, restrictions on the use of real property
and defects and irregularities in the title thereto, landlord's or
lessor's liens under leases to which the
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Borrower or any of the other Transaction Parties is a party, and other
minor liens or encumbrances none of which in the opinion of the
Borrower interferes materially with the use of the property affected in
the ordinary conduct of the business of the Borrower and the other
Transaction Parties, which defects do not individually or in the
aggregate have a materially adverse effect on the business of the
Borrower individually or of the Borrower and the other Transaction
Parties on a consolidated basis;
(g) liens existing on the date hereof and listed on SCHEDULE 9.2
hereto;
(h) purchase money security interests in or purchase money
mortgages on real or personal property acquired after the date hereof
to secure purchase money Indebtedness of the type and amount permitted
by ss.9.1(g), incurred in connection with the acquisition of such
property, which security interests or mortgages cover only the real or
personal property so acquired; and
(i) liens on any Margin Stock held by the Borrower or the other
Transaction Parties.
9.3. RESTRICTIONS ON INVESTMENTS. The Borrower will not, and will not
permit any of the other Transaction Parties to, make or permit to exist or to
remain outstanding any Investment except for Investments in:
(a) marketable direct or guaranteed obligations of the United
States of America that mature within one (1) year from the date of
purchase by the Borrower;
(b) demand deposits, certificates of deposit, bankers
acceptances, money market deposits and time deposits of any of the
Banks (including branches of any of the Banks) or other United States
banks having total assets in excess of $1,000,000,000;
(c) securities commonly known as "commercial paper" issued by a
corporation organized and existing under the laws of the United States
of America or any state thereof that at the time of purchase have been
rated and the ratings for which are not less than "P 1" if rated by
Xxxxx'x Investors Services, Inc., and not less than "A 1" if rated by
Standard and Poor's;
(d) mutual funds which invest solely in the types of Investments
described in ss.9.3(a), (b) and (c);
(e) Investments existing on the date hereof and listed on
SCHEDULE 9.3 hereto;
(f) Investments consisting of the Guaranties or Investments by
the Borrower in (i) any of the Guarantors, (ii) Hadco FSC in an
aggregate amount not to exceed $2,000,000; or (iii) New Zycon in an
aggregate amount not to exceed $50,000;
(g) Investments with respect to Indebtedness permitted by
ss.9.1(i)(iii);
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(h) Investments consisting of promissory notes received as
proceeds of asset dispositions permitted by ss.9.5.3 and Investments
otherwise permitted by ss.9.5.2;
(i) Investments consisting of loans and advances to employees
for moving, entertainment, travel and other similar expenses in the
ordinary course of business not to exceed $10,000,000 in the aggregate
at any time outstanding;
(j) marketable direct or guaranteed obligations of United States
municipalities that are rated by Standard and Poor's and Xxxxx'x
Investors Services, Inc. as investment grade and that mature within
five (5) years from the date of purchase by the Borrower, in an amount
not to exceed $2,000,000 from any one issuing municipality and in an
aggregate amount not to exceed the lesser of $5,000,000 and fifty
percent (50%) of all Investments made by the Borrower or any of the
other Transaction Parties under ss.9.3(a), (b), (c), (d) and (k); and
(k) mutual funds investing in marketable direct or guaranteed
obligations of United States municipalities that are rated by Standard
and Poor's and Xxxxx'x Investors Services, Inc. as investment grade and
that mature within five (5) years from the date of purchase by the
Borrower, in an amount not to exceed $2,000,000 from any mutual fund
and in an aggregate amount not to exceed $5,000,000.
9.4. DISTRIBUTIONS. The Borrower will not make any Distributions.
9.5. MERGERS AND CONSOLIDATIONS, ACQUISITIONS AND DISPOSITION OF
ASSETS.
9.5.1. MERGERS AND CONSOLIDATIONS. The Borrower will not, and
will not permit any of the other Transaction Parties to, become
a party to any merger or consolidation, except (a) the merger or
consolidation of one or more Subsidiaries of the Borrower with
and into the Borrower, (b) the merger or consolidation of two or
more Subsidiaries of the Borrower and (c) the merger or
consolidation of a Target of a Permitted Acquisition with and
into the Borrower or one of its Subsidiaries.
9.5.2. ACQUISITIONS. The Borrower will not, and will not permit
any of the other Transaction Parties to agree to or effect any
asset acquisition or stock acquisition (other than the
acquisition of assets in the ordinary course of business
consistent with past practices); PROVIDED, HOWEVER, that:
(a) so long as no Default or Event of Default has occurred
and is continuing or would result therefrom, the Borrower may
make one or more asset or stock acquisitions in an amount not to
exceed $25,000,000 in any individual case or $50,000,000 in the
aggregate; PROVIDED, HOWEVER, that any such stock acquisition
shall not result in the Borrower, individually or collectively
with any one or more of its Affiliates, owning, either legally
or beneficially, more than fifty percent (50.00%) of the Voting
Stock of any entity which is the subject of such acquisition;
and
(b) subject to the requirements of this ss.9.5.2(b), the
Borrower may effecT asset or stock acquisitions in addition to
those otherwise permitted by
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this ss.9.5.2 to the extent that (i) the business to be acquired
(the "Target") is in the same or similar lines of business as
the Borrower and the other Transaction Parties, (ii) each of the
annual financial statements of the Target for each of the
immediately preceding three (3) fiscal years of the Target and
each of its Subsidiaries, show a positive net income prior to
adjustments, (iii) following the completion of such Permitted
Acquisition, the Borrower or one of its wholly owned
Subsidiaries shall own one hundred percent (100%) of the stock
and assets of the Target and each of its Subsidiaries, (iv) as
of the date of such Permitted Acquisition, no Default or Event
of Default shall have occurred and be continuing or shall occur
after giving effect thereto; (v) after giving effect to such
Permitted Acquisition, the ratio of Consolidated Funded Debt as
at the most recent fiscal quarter end of the Borrower to EBITDA
for the four consecutive fiscal quarters of the Borrower ending
with such quarter end (as shown on a PRO FORMA basis based upon
(A) the most recently delivered financial statements of the
Borrower and its Subsidiaries delivered in accordance with
ss.8.4 and (B) audited financial statements for such Target as
at the most recent fiscaL quarter end of the Borrower which are
accompanied by an unqualified audited opinion letter from Xxxxxx
Xxxxxxxx LLP or another nationally recognized accounting firm
satisfactory to the Agent and the Majority Banks or which are
otherwise satisfactory to the Agent and the Majority Banks)
would not exceed 3.0:1.0; and (vi) contemporaneously with the
closing of such Permitted Acquisition, the Borrower shall
provide to the Agent and the Banks a compliance certificate in
the form of EXHIBIT C, duly certified by the principal financial
or accounting officer of the Borrower, indicating the Borrower's
compliance with (x) the financial covenants contained in ss.10
immediately prior to and, on a PRO FORMA basis, immediately
following such Permitted Acquisition and (y) on a PRO FORMA
basis, the requirement set forth in ss.9.5.2(b)(v); and PROVIDED
FURTHER that, contemporaneously with the closing of such
Permitted Acquisition, any newly acquired Subsidiary shall,
pursuant to documentation in form and substance satisfactory to
the Agent and the Agent's Special Counsel, become a party to and
Guarantor under, and be bound by all of the terms and conditions
of, a Guaranty in the form of EXHIBIT E hereto and shall provide
to the Agent, in addition to such Guaranty, such evidence of
corporate authorization, legal opinions and other documentation
as the Agent may request. To the extent that any such Permitted
Acquisition alters the accuracy or completeness of any of the
Schedules hereto, the Borrower shall deliver to the Agent,
contemporaneously with the delivery of the loan documentation
referred to above, revised schedules reflecting changes
resulting from such Permitted Acquisition; PROVIDED that the
Agent shall only be required to accept such revised schedules,
and such revised schedules shall only become part of this Credit
Agreement, in the event that the Borrower shall have taken any
and all action necessary to bring such newly acquired Subsidiary
into compliance with each representation and warranty set forth
herein, including in ss.7 hereof; and PROVIDED FURTHER that no
change resulting from any Permitted Acquisition would have a
material adverse effect on the Borrower and the other
Transaction Parties, taken as a whole.
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9.5.3. DISPOSITION OF ASSETS. The Borrower will not, and will
not permit any of the other Transaction Parties to, become a
party to or agree to or effect any disposition of assets, other
than the disposition of assets in the ordinary course of
business, consistent with past practices, and dispositions of
Margin Stock for fair market value in cash.
9.6. SALE AND LEASEBACK. Except for arrangements described on SCHEDULE
9.6 and arrangements with respect to which the property being sold or
transferred has an aggregate fair market value not to exceed $10,000,000 for all
such arrangements, the Borrower will not, and will not permit any of the other
Transaction Parties to, enter into any arrangement, directly or indirectly,
whereby the Borrower or any of the other Transaction Parties shall sell or
transfer any property owned by it in order then or thereafter to lease such
property or lease other property that the Borrower or any of the other
Transaction Parties intends to use for substantially the same purpose as the
property being sold or transferred.
9.7. COMPLIANCE WITH ENVIRONMENTAL LAWS. Except to the extent that any
of the following would not have a material adverse effect on the business,
assets or financial condition of the Transaction Parties, considered as a whole,
the Borrower will not, and will not permit any of the other Transaction Parties
to, (i) use any of the Real Estate or any portion thereof for the handling,
processing, storage or disposal of Hazardous Substances, (ii) cause or permit to
be located on any of the Real Estate any underground tank or other underground
storage receptacle for Hazardous Substances, (iii) generate any Hazardous
Substances on any of the Real Estate, (iv) conduct any activity at any Real
Estate or use any Real Estate in any manner so as to cause a release (i.e.
releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging,
injecting, escaping, leaching, disposing or dumping) or threatened release of
Hazardous Substances on, upon or into the Real Estate or (v) otherwise conduct
any activity at any Real Estate or use any Real Estate in any manner that would
violate any Environmental Law or bring such Real Estate in violation of any
Environmental Law.
9.8. EMPLOYEE BENEFIT PLANS. Neither the Borrower nor any ERISA
Affiliate will
(a) engage in any "prohibited transaction" within the meaning of
ss.406 of ERISA or ss.4975 of the Code which could result in a material
liability for the Borrower or any of the other Transaction Parties; or
(b) permit any Guaranteed Pension Plan to incur an "accumulated
funding deficiency", as such term is defined in ss.302 of ERISA,
whether or not such deficiency is or may be waived; or
(c) fail to contribute to any Guaranteed Pension Plan to an
extent which, or terminate any Guaranteed Pension Plan in a manner
which, could result in the imposition of a lien or encumbrance on the
assets of the Borrower or any of the other Transaction Parties pursuant
to ss.302(f) or ss.4068 of ERISA; or
(d) amend any Guaranteed Pension Plan in circumstances requiring
the posting of security pursuant to ss.307 of ERISA or ss.401(a)(29) of
the Code; or
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(e) permit or take any action which would result in the
aggregate benefit liabilities (with the meaning of ss.4001 of ERISA) of
all Guaranteed Pension Plans exceeding the value of thE aggregate
assets of such Plans, disregarding for this purpose the benefit
liabilities and assets of any such Plan with assets in excess of
benefit liabilities.
9.9. CAPITALIZATION. The Borrower will not and will not permit any of
the other Transaction Parties to designate, establish or create any new or
additional series of capital stock or effect or permit any change in or
amendment to its charter documents (other than a change to increase the amount
of authorized common stock of such Person) or any other document or instrument
pertaining to the terms of the capital stock of such Person. Neither the
Borrower nor any of the other Transaction Parties will enter into or permit to
exist any contractual or other obligation to redeem, retire or repurchase any of
its capital stock.
9.10. AGREEMENTS REGARDING HADCO FSC AND NEW ZYCON. Neither the
Borrower nor any of the other Transaction Parties shall permit Hadco FSC (a) to
engage in any activities other than those directly related to its purpose as a
foreign sales corporation pursuant to ss.ss.921-927 of the Code or (b) at Any
time to own, hold or have an interest in property or assets, whether tangible or
intangible and including cash and cash equivalents, with a fair market value in
excess of $2,000,000. Neither the Borrower nor any of the other Transaction
Parties shall permit New Zycon (x) to engage in any activities other than
holding the name "Zycon Corporation" for the benefit of the Borrower and its
Subsidiaries or (y) at any time to own, hold or have an interest in property or
assets, whether tangible or intangible and including cash and cash equivalents,
with a fair market value in excess of $50,000.
10. FINANCIAL COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit or Note is outstanding or any Bank
has any obligation to make any Loans or the Agent has any obligation to issue,
extend or renew any Letters of Credit:
10.1. FUNDED DEBT TO EBITDA. The Borrower will not, as at the end of
any four consecutive fiscal quarters of the Borrower, permit the ratio of (a)
Consolidated Funded Debt as at such quarter end to (b) EBITDA for such four
consecutive fiscal quarters then ended to be greater than 3.25:1.00.
10.2. DEBT SERVICE. The Borrower will not, as at the end of any four
consecutive fiscal quarters of the Borrower, permit the ratio of (a) EBIT for
such fiscal quarters to (b) Consolidated Total Interest Expense for such fiscal
quarters, to be less than 3.5:1.0.
10.3. CONSOLIDATED NET WORTH. The Borrower will not permit Consolidated
Net Worth at any time to be less than the sum of (a) $60,000,000 PLUS (b) on a
cumulative basis, fifty percent (50%) of positive Consolidated Net Income (not
to be reduced for losses) for each fiscal quarter beginning with the fiscal
quarter ended January 25, 1997, PLUS (c) one hundred percent (100%) of the net
proceeds of any sale by the Borrower since January 8, 1997 of (i) equity
securities issued by the Borrower or (ii) warrants or subscription rights for
equity securities issued by the Borrower MINUS (d) without duplication (and in
the event
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not included in the calculation of positive Consolidated Net Income in clause
(b) above), Non-Cash Acquisition Expenses.
10.4. FIXED CHARGE COVERAGE RATIO. The Borrower will not at any time
permit the ratio of (a)(i) EBITDA for any four consecutive fiscal quarters of
the Borrower MINUS (ii) Capital Expenditures made by the Borrower or any of its
Subsidiaries during such period MINUS (iii) cash taxes paid by the Borrower or
any of its Subsidiaries during such period to (b)(i) principal payments on
Indebtedness for borrowed money made by the Borrower or any of its Subsidiaries
during such period PLUS (ii) Consolidated Total Interest Expense of the Borrower
and its Subsidiaries for such period to be less than 1.10:1.00. The calculation
of such ratio shall include, on a PRO FORMA basis and if and to the extent
approved by the Majority Banks (which approval shall require, INTER ALIA, the
Agent's and the Banks' receipt of audited financial statements for any Target
acquired in accordance with ss.9.5.2(b), together with aN unqualified audited
opinion letter from Xxxxxx Xxxxxxxx LLP or another nationally recognized
accounting firm satisfactory to the Agent and the Majority Banks, or which
financial statements or opinion letter shall otherwise be satisfactory to the
Agent and the Majority Banks), EBITDA for such period of any Target acquired in
compliance with ss.9.5.2(b).
11. CLOSING CONDITIONS.
The obligations of the Banks to make the initial Loans and of the Agent
to issue any initial Letters of Credit shall be subject to the satisfaction of
the following conditions precedent on or prior to December 15, 1997:
11.1. LOAN DOCUMENTS. Each of the Loan Documents shall have been duly
executed and delivered by the respective parties thereto, shall be in full force
and effect and shall be in form and substance satisfactory to each of the Banks.
Each Bank shall have received a fully executed copy of each such document. The
conditions, actions and items set forth in the Post-Closing Letter shall not be
deemed waived by virtue of the fact that they are not completed as of the
Closing Date.
11.2. CERTIFIED COPIES OF CHARTER DOCUMENTS. Each of the Banks shall
have received from each of the Borrower and Hadco Santa Xxxxx, a copy, certified
by a duly authorized officer of such Person to be true and complete on the
Closing Date, of each of (i) its charter or other incorporation documents as in
effect on such date of certification, and (ii) its by-laws as in effect on such
date.
11.3. CORPORATE ACTION. All corporate action necessary for the valid
execution, delivery and performance by the Borrower and each of the other
Transaction Parties of this Credit Agreement and the other Loan Documents to
which it is or is to become a party shall have been duly and effectively taken,
and evidence thereof satisfactory to the Banks shall have been provided to each
of the Banks.
11.4. INCUMBENCY CERTIFICATE. Each of the Banks shall have received
from each Transaction Party an incumbency certificate, dated as of the Closing
Date, signed by a duly authorized officer of such Transaction Party, and giving
the name and bearing a specimen signature of each individual who shall be
authorized: (i) to sign, in the name and on behalf of each such Transaction
Party, each of the Loan Documents to which such Transaction
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Party is or is to become a party; (ii) in the case of the Borrower, to make Loan
Requests and Conversion Requests and to apply for Letters of Credit; and (iii)
to give notices and to take other action on its behalf under the Loan Documents
to which it is a party.
11.5. UCC SEARCH RESULTS. The Agent shall have received from each of
the Borrower and the other Transaction Parties the results of UCC searches in
jurisdictions certified by the Borrower as constituting the locations of all
offices and locations, including the chief executive office, of the Borrower and
each of the other Transaction Parties and in such other jurisdictions as the
Agent may request, indicating no liens other than Permitted Liens and otherwise
in form and substance satisfactory to the Agent.
11.6. CERTIFICATES OF INSURANCE. The Agent shall have received (i) a
certificate of insurance from an independent insurance broker dated as of the
Closing Date, identifying insurers, types of insurance, insurance limits, and
policy terms, and otherwise describing the insurance obtained in accordance with
the provisions of this Credit Agreement and (ii) certified copies of all
policies evidencing such insurance (or certificates therefore signed by the
insurer or an agent authorized to bind the insurer).
11.7. SOLVENCY CERTIFICATE. Each of the Banks shall have received an
officer's certificate of the Borrower dated as of the Closing Date as to the
solvency of the Borrower and the other Transaction Parties following the
consummation of the transactions contemplated herein and in the other Loan
Documents and in form and substance satisfactory to the Banks.
11.8. OPINION OF COUNSEL. Each of the Banks and the Agent shall have
received a favorable legal opinion addressed to the Banks and the Agent, dated
as of the Closing Date, in form and substance satisfactory to the Banks and the
Agent, from Berlin, Xxxxxxxx & Xxxxxx, counsel to the Borrower and its
Subsidiaries.
11.9. PAYMENT OF FEES. The Borrower shall have paid to the Banks or the
Agent, as appropriate, any Letter of Credit fees and the fees payable pursuant
to ss.5.1 and the Agent's Side Letter.
11.10. PAY-OFF LETTERS, ETC. The Agent shall have received separate
pay-off letters, each satisfactory in form and substance to the Agent, from each
of the Exiting Banks, indicating all loan obligations of the Borrower and its
Subsidiaries to such Exiting Bank under the Original Credit Agreement to be
discharged on the Closing Date and setting forth an agreement by each such
Exiting Bank that, upon receipt of such funds, all loan obligations shall be
paid and discharged in full and instructing the Agent to use a portion of the
proceeds of the initial Loans to make such repayments.
12. CONDITIONS TO ALL BORROWINGS.
The obligations of the Banks to make any Loan, and of the Agent to
issue, extend or renew any Letter of Credit, in each case whether on or after
the Closing Date, shall also be subject to the satisfaction of the following
conditions precedent:
12.1. REPRESENTATIONS TRUE; NO EVENT OF DEFAULT. Each of the
representations and warranties of any of the Borrower and the Guarantors
contained in this Credit
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Agreement, the other Loan Documents or in any document or instrument delivered
pursuant to or in connection with this Credit Agreement shall be true as of the
date as of which they were made and shall also be true at and as of the time of
the making of such Loan or the issuance, extension or renewal of such Letter of
Credit, with the same effect as if made at and as of that time (except to the
extent of changes resulting from transactions contemplated or permitted by this
Credit Agreement and the other Loan Documents and changes occurring in the
ordinary course of business that singly or in the aggregate are not materially
adverse, and to the extent that such representations and warranties relate
expressly to an earlier date) and no Default or Event of Default shall have
occurred and be continuing. The Agent shall have received a certificate of the
Borrower signed by an authorized officer of the Borrower to such effect.
12.2. NO LEGAL IMPEDIMENT. No change shall have occurred in any law or
regulations thereunder or interpretations thereof that in the reasonable opinion
of any Bank would make it illegal for such Bank to make such Loan or to
participate in the issuance, extension or renewal of such Letter of Credit or in
the reasonable opinion of the Agent would make it illegal for the Agent to
issue, extend or renew such Letter of Credit.
12.3. GOVERNMENTAL REGULATION. Each Bank shall have received such
statements in substance and form reasonably satisfactory to such Bank as such
Bank shall require for the purpose of compliance with any applicable regulations
of the Comptroller of the Currency or the Board of Governors of the Federal
Reserve System.
12.4. PROCEEDINGS AND DOCUMENTS. All proceedings in connection with the
transactions contemplated by this Credit Agreement, the other Loan Documents and
all other documents incident thereto shall be satisfactory in substance and in
form to the Banks and to the Agent and the Agent's Special Counsel, and the
Banks, the Agent and such counsel shall have received all information and such
counterpart originals or certified or other copies of such documents as the
Agent may reasonably request.
13. EVENTS OF DEFAULT; ACCELERATION; ETC.
13.1. EVENTS OF DEFAULT AND ACCELERATION. If any of the following
events ("Events of Default" or, if the giving of notice or the lapse of time or
both is required, then, prior to such notice or lapse of time, "Defaults") shall
occur:
(a) the Borrower shall fail to pay any principal of the Loans or
any Reimbursement Obligation when the same shall become due and
payable, whether at the stated date of maturity or any accelerated date
of maturity or at any other date fixed for payment;
(b) the Borrower or any of the other Transaction Parties shall
fail to pay any interest on the Loans, the commitment fee, any Letter
of Credit Fee, the Agent's fee, or other sums due hereunder or under
any of the other Loan Documents, within two (2) Business Days after the
day on which the same shall become due and payable, whether at the
stated date of maturity or any accelerated date of maturity or at any
other date fixed for payment;
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(c) the Borrower shall fail to comply with any of its covenants
contained in ss.8, 9 or 10;
(d) the Borrower or any of the other Transaction Parties shall
fail to perform any term, covenant or agreement contained herein or in
any of the other Loan Documents (other than those specified elsewhere
in this ss.13.1) for twenty (20) days after written notice of sucH
failure has been given to the Borrower by the Agent;
(e) any representation or warranty of the Borrower or any of the
other Transaction Parties in this Credit Agreement or any of the other
Loan Documents or in any other document or instrument delivered
pursuant to or in connection with this Credit Agreement shall prove to
have been false in any material respect upon the date when made or
deemed to have been made or repeated;
(f) the Borrower or any of the other Transaction Parties shall
fail to pay at maturity, or within any applicable period of grace, any
obligations for borrowed money or credit received or in respect of any
Capitalized Leases, which obligations exceed $5,000,000 in the
aggregate, or fail to observe or perform any material term, covenant or
agreement contained in any agreement by which it is bound (excluding,
however, any such term, covenant or agreement relating to the pledge or
disposition of Margin Stock), evidencing or securing borrowed money or
credit received or in respect of any Capitalized Leases exceeding
$5,000,000 in the aggregate, for such period of time as would permit
(assuming the giving of appropriate notice if required) the holder or
holders thereof or of any obligations issued thereunder to accelerate
the maturity thereof;
(g) the Borrower or any of the other Transaction Parties shall
make an assignment for the benefit of creditors, or admit in writing
its inability to pay or generally fail to pay its debts as they mature
or become due, or shall petition or apply for the appointment of a
trustee or other custodian, liquidator or receiver of the Borrower or
any of the other Transaction Parties or of any substantial part of the
assets of the Borrower or any of the other Transaction Parties or shall
commence any case or other proceeding relating to the Borrower or any
of the other Transaction Parties under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or
liquidation or similar law of any jurisdiction, now or hereafter in
effect, or shall take any action to authorize or in furtherance of any
of the foregoing, or if any such petition or application shall be filed
or any such case or other proceeding shall be commenced against the
Borrower or any of the other Transaction Parties and the Borrower or
any of the other Transaction Parties shall indicate its approval
thereof, consent thereto or acquiescence therein or such petition or
application shall not have been dismissed within forty-five (45) days
following the filing thereof;
(h) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating the Borrower or any
of the other Transaction Parties bankrupt or insolvent, or approving a
petition in any such case or other proceeding, or a decree or order for
relief is entered in respect of the Borrower or
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any of the other Transaction Parties in an involuntary case under
federal bankruptcy laws as now or hereafter constituted;
(i) there shall remain in force, undischarged, unsatisfied and
unstayed, for more than thirty (30) days, any final judgment against
the Borrower or any of the other Transaction Parties that, with other
outstanding final judgments, undischarged, against the Borrower or any
of the other Transaction Parties exceeds in the aggregate $5,000,000;
(j) if any of the Loan Documents shall be cancelled, terminated,
revoked or rescinded, in each case otherwise than with the express
prior written agreement, consent or approval of the Banks, or any
action at law, suit or in equity or other legal proceeding to cancel,
revoke or rescind any of the Loan Documents shall be commenced by or on
behalf of the Borrower or any of the other Transaction Parties party
thereto or any of their respective stockholders, or any court or any
other governmental or regulatory authority or agency of competent
jurisdiction shall make a determination that, or issue a judgment,
order, decree or ruling to the effect that, any one or more of the Loan
Documents is illegal, invalid or unenforceable in accordance with the
terms thereof;
(k) the Borrower or any ERISA Affiliate incurs any liability to
the PBGC or a Guaranteed Pension Plan pursuant to Title IV of ERISA in
an aggregate amount exceeding $2,000,000; the Borrower or any ERISA
Affiliate is assessed withdrawal liability pursuant to Title IV of
ERISA by a Multiemployer Plan requiring aggregate annual payments
exceeding $2,000,000, or any of the following occurs with respect to a
Guaranteed Pension Plan: (i) an ERISA Reportable Event, or a failure to
make a required installment or other payment (within the meaning of
ss.302(f)(1) of ERISA), provided the Agent determines in its reasonable
discretioN that such event (A) could be expected to result in liability
of the Borrower to the PBGC or the Plan in an aggregate amount
exceeding $2,000,000 and (B) could constitute grounds for the
termination of such Plan by the PBGC, for the appointment by the
appropriate United States District Court of a trustee to administer
such Plan or for the imposition of a lien in favor of the Guaranteed
Pension Plan; (ii) the appointment by a United States District court of
a trustee to administer such Plan; or (iii) the institution by the PBGC
of proceedings to terminate such Plan;
(l) the Borrower or any of the other Transaction Parties shall
be enjoined, restrained or in any way prevented by the order of any
court or any administrative or regulatory agency from conducting any
material part of its business and such order shall continue in effect
for more than thirty (30) days;
(m) there shall occur any strike, lockout, labor dispute,
embargo, condemnation, act of God or public enemy, or other casualty,
which in any such case causes, for more than fifteen (15) consecutive
days, the cessation or substantial curtailment of revenue producing
activities at any facility of the Borrower or any of the other
Transaction Parties if such event or circumstance is not covered by
business interruption insurance and would have a material adverse
effect on the business or financial condition of the Borrower and the
other Transaction Parties, considered as a whole;
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(n) there shall occur the loss, suspension or revocation of, or
failure to renew, any license or permit now held or hereafter acquired
by the Borrower or any of the other Transaction Parties if such loss,
suspension, revocation or failure to renew would have a material
adverse effect on the business or financial condition of the Borrower
and the other Transaction Parties, considered as a whole;
(o) the Borrower or any of the other Transaction Parties shall
be indicted for a state or federal crime, or any civil or criminal
action shall otherwise have been brought or threatened against the
Borrower or any the other Transaction Parties, a punishment for which
in any such case could include the forfeiture of any assets of the
Borrower or such other Transaction Party having a fair market value in
excess of $1,000,000; or
(p) any person or group of persons (within the meaning of
Section 13 or 14 of the Securities Exchange Act of 1934, as amended)
shall have acquired beneficial ownership (within the meaning of Rule
13d-3 promulgated by the Securities and Exchange Commission under said
Act) of thirty percent (30%) or more of the outstanding shares of
common stock of the Borrower; or, during any period of twelve
consecutive calendar months, individuals who were directors of the
Borrower on the first day of such period shall cease to constitute a
majority of the board of directors of the Borrower or the Borrower
shall, at any time, legally or beneficially own less than one hundred
percent (100%) of the shares of the capital stock of Hadco Santa Xxxxx
(on a fully diluted basis);
then, and in any such event, so long as the same may be continuing, the Agent
may, and upon the request of the Majority Banks shall, by notice in writing to
the Borrower declare all amounts owing with respect to this Credit Agreement,
the Notes and the other Loan Documents and all Reimbursement Obligations to be,
and they shall thereupon forthwith become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Borrower; PROVIDED that in the event of any Event
of Default specified in ss.ss.13.1(g) or 13.1(h), all such amounts shall become
immediately due and payable automatically and without any requirement of notice
from the Agent or any Bank.
13.2. TERMINATION OF COMMITMENTS. If any one or more of the Events of
Default specified in ss.13.1(g) or ss.13.1(h) shall occur and be continuing, any
unused portion of the credit hereunder shall forthwith terminate and each of the
Banks shall be relieved of all further obligations to make Loans to the Borrower
and the Agent shall be relieved of all further obligations to issue, extend or
renew Letters of Credit. If any other Event of Default shall have occurred and
be continuing, the Agent may and, upon the request of the Majority Banks, shall,
by notice to the Borrower, terminate the unused portion of the credit hereunder,
and upon such notice being given such unused portion of the credit hereunder
shall terminate immediately and each of the Banks shall be relieved of all
further obligations to make Loans and the Agent shall be relieved of all further
obligations to issue, extend or renew Letters of Credit. No termination of the
credit hereunder shall relieve the Borrower or any of the other Transaction
Parties of any of the Obligations.
13.3. REMEDIES. In case any one or more of the Events of Default shall
have occurred and be continuing, and whether or not the Banks shall have
accelerated the
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maturity of the Loans pursuant to ss.13.1, each Bank, if owed any amount with
respect to the Loans or the Reimbursement Obligations, may, with the consent of
the Majority Banks but not otherwise, proceed to protect and enforce its rights
by suit in equity, action at law or other appropriate proceeding, whether for
the specific performance of any covenant or agreement contained in this Credit
Agreement and the other Loan Documents or any instrument pursuant to which the
Obligations to such Bank are evidenced, including as permitted by applicable law
the obtaining of the EX PARTE appointment of a receiver, and, if such amount
shall have become due, by declaration or otherwise, proceed to enforce the
payment thereof or any other legal or equitable right of such Bank. No remedy
herein conferred upon any Bank or the Agent or the holder of any Note or
purchaser of any Letter of Credit Participation is intended to be exclusive of
any other remedy and each and every remedy shall be cumulative and shall be in
addition to every other remedy given hereunder or now or hereafter existing at
law or in equity or by statute or any other provision of law.
14. SETOFF.
Regardless of the adequacy of any collateral, during the continuance of
any Event of Default, any deposits or other sums credited by or due from any of
the Banks to the Borrower and any securities or other property of the Borrower
in the possession of such Bank may be applied to or set off by such Bank against
the payment of Obligations and any and all other liabilities, direct, or
indirect, absolute or contingent, due or to become due, now existing or
hereafter arising, of the Borrower to such Bank. Each of the Banks agrees with
each other Bank that (i) if an amount to be set off is to be applied to
Indebtedness of the Borrower to such Bank, other than Indebtedness evidenced by
the Notes held by such Bank or constituting Reimbursement Obligations owed to
such Bank, such amount shall be applied ratably to such other Indebtedness and
to the Indebtedness evidenced by all such Notes held by such Bank or
constituting Reimbursement Obligations owed to such Bank, and (ii) if such Bank
shall receive from the Borrower, whether by voluntary payment, exercise of the
right of setoff, counterclaim, cross action, enforcement of the claim evidenced
by the Notes held by, or constituting Reimbursement Obligations owed to, such
Bank by proceedings against the Borrower at law or in equity or by proof thereof
in bankruptcy, reorganization, liquidation, receivership or similar proceedings,
or otherwise, and shall retain and apply to the payment of the Note or Notes
held by, or Reimbursement Obligations owed to, such Bank any amount in excess of
its ratable portion of the payments received by all of the Banks with respect to
the Notes held by, and Reimbursement Obligations owed to, all of the Banks, such
Bank will notify the Agent thereof and make such disposition and arrangements
with the other Banks with respect to such excess, either by way of distribution,
PRO TANTO assignment of claims, subrogation or otherwise as shall result in each
Bank receiving in respect of the Notes held by it or Reimbursement Obligations
owed it, its proportionate payment as contemplated by this Credit Agreement;
PROVIDED that if all or any part of such excess payment is thereafter recovered
from such Bank, such disposition and arrangements shall be rescinded and the
amount restored to the extent of such recovery, but without interest.
15. THE AGENT.
15.1. AUTHORIZATION.
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(a) The Agent is authorized to take such action on behalf of
each of the Banks and to exercise all such powers as are hereunder and
under any of the other Loan Documents and any related documents
delegated to the Agent, together with such powers as are reasonably
incident thereto; PROVIDED that no duties or responsibilities not
expressly assumed herein or therein shall be implied to have been
assumed by the Agent.
(b) The relationship between the Agent and each of the Banks is
that of an independent contractor. The use of the term "Agent" is for
convenience only and is used to describe, as a form of convention, the
independent contractual relationship between the Agent and each of the
Banks. Nothing contained in this Credit Agreement nor the other Loan
Documents shall be construed to create an agency, trust or other
fiduciary relationship between the Agent and any of the Banks.
(c) As an independent contractor empowered by the Banks to
exercise certain rights and perform certain duties and responsibilities
hereunder and under the other Loan Documents, the Agent is nevertheless
a "representative" of the Banks, as that term is defined in Article 1
of the Uniform Commercial Code, for purposes of actions for the benefit
of the Banks and the Agent with respect to all collateral security and
guaranties contemplated by the Loan Documents.
15.2. EMPLOYEES AND AGENTS. The Agent may exercise its powers and
execute its duties by or through employees or agents and shall be entitled to
take, and to rely on, advice of counsel concerning all matters pertaining to its
rights and duties under this Credit Agreement and the other Loan Documents. The
Agent may utilize the services of such Persons as the Agent in its sole
discretion may reasonably determine, and all reasonable fees and expenses of any
such Persons shall be paid by the Borrower.
15.3. NO LIABILITY. Neither the Agent nor any of its shareholders,
directors, officers or employees nor any other Person assisting them in their
duties nor any agent or employee thereof, shall be liable for any waiver,
consent or approval given or any action taken, or omitted to be taken, in good
faith by it or them hereunder or under any of the other Loan Documents, or in
connection herewith or therewith, or be responsible for the consequences of any
oversight or error of judgment whatsoever, except that the Agent or such other
Person, as the case may be, may be liable for losses due to its willful
misconduct or gross negligence.
15.4. NO REPRESENTATIONS. The Agent shall not be responsible for the
execution or validity or enforceability of this Credit Agreement, the Notes, the
Letters of Credit, any of the other Loan Documents or any instrument at any time
constituting, or intended to constitute, collateral security for the Notes, or
for the value of any such collateral security or for the validity,
enforceability or collectability of any such amounts owing with respect to the
Notes, or for any recitals or statements, warranties or representations made
herein or in any of the other Loan Documents or in any certificate or instrument
hereafter furnished to it by or on behalf of the Borrower or any of the other
Transaction Parties, or be bound to ascertain or inquire as to the performance
or observance of any of the terms, conditions, covenants or agreements herein or
in any instrument at any time constituting, or intended to constitute,
collateral security for the Notes or to inspect any of the properties, books or
records of the Borrower or any of the Transaction Parties. The Agent shall not
be bound to
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ascertain whether any notice, consent, waiver or request delivered to it by the
Borrower or any holder of any of the Notes shall have been duly authorized or is
true, accurate and complete. The Agent has not made nor does it now make any
representations or warranties, express or implied, nor does it assume any
liability to the Banks, with respect to the credit worthiness or financial
conditions of the Borrower or any of the Transaction Parties. Each Bank
acknowledges that it has, independently and without reliance upon the Agent or
any other Bank, and based upon such information and documents as it has deemed
appropriate, made its own credit analysis and decision to enter into this Credit
Agreement.
15.5. PAYMENTS.
15.5.1. PAYMENTS TO AGENT. A payment by the Borrower to the
Agent hereunder or any of the other Loan Documents for the
account of any Bank shall constitute a payment to such Bank. The
Agent agrees promptly to distribute to each Bank such Bank's PRO
RATA share of payments received by the Agent for the account of
the Banks except as otherwise expressly provided herein or in
any of the other Loan Documents.
15.5.2. DISTRIBUTION BY AGENT. If, in the opinion of the Agent,
the distribution of any amount received by it in such capacity
hereunder, under the Notes or under any of the other Loan
Documents might involve it in liability, it may refrain from
making distribution until its right to make distribution shall
have been adjudicated by a court of competent jurisdiction. If a
court of competent jurisdiction shall adjudge that any amount
received and distributed by the Agent is to be repaid, each
Person to whom any such distribution shall have been made shall
either repay to the Agent its proportionate share of the amount
so adjudged to be repaid or shall pay over the same in such
manner and to such Persons as shall be determined by such court.
15.5.3. DELINQUENT BANKS. Notwithstanding anything to the
contrary contained in this Credit Agreement or any of the other
Loan Documents, any Bank that fails (i) to make available to the
Agent its PRO RATA share of any Loan or to purchase any Letter
of Credit Participation or (ii) to comply with the provisions of
ss.14 with respect to making dispositions and arrangements with
the other Banks, where such Bank's share of any payment
received, whether by setoff or otherwise, is in excess of its
PRO RATA share of such payments due and payable to all of the
Banks, in each case as, when and to the full extent required by
the provisions of this Credit Agreement, shall be deemed
delinquent (a "Delinquent Bank") and shall be deemed a
Delinquent Bank until such time as such delinquency is
satisfied. A Delinquent Bank shall be deemed to have assigned
any and all payments due to it from the Borrower, whether on
account of outstanding Loans, Unpaid Reimbursement Obligations,
interest, fees or otherwise, to the remaining nondelinquent
Banks for application to, and reduction of, their respective PRO
RATA shares of all outstanding Loans and Unpaid Reimbursement
Obligations. The Delinquent Bank hereby authorizes the Agent to
distribute such payments to the nondelinquent Banks in
proportion to their respective PRO RATA shares of all
outstanding Loans and Unpaid Reimbursement Obligations. A
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Delinquent Bank shall be deemed to have satisfied in full a
delinquency when and if, as a result of application of the
assigned payments to all outstanding Loans and Unpaid
Reimbursement Obligations of the nondelinquent Banks, the Banks'
respective PRO RATA shares of all outstanding Loans and Unpaid
Reimbursement Obligations have returned to those in effect
immediately prior to such delinquency and without giving effect
to the nonpayment causing such delinquency.
15.6. HOLDERS OF NOTES. The Agent may deem and treat the payee of any
Note or the purchaser of any Letter of Credit Participation as the absolute
owner or purchaser thereof for all purposes hereof until it shall have been
furnished in writing with a different name by such payee or by a subsequent
holder, assignee or transferee.
15.7. INDEMNITY. The Banks ratably agree hereby to indemnify and hold
harmless the Agent from and against any and all claims, actions and suits
(whether groundless or otherwise), losses, damages, costs, expenses (including
any expenses for which the Agent has not been reimbursed by the Borrower as
required by ss.16), and liabilities of every nature and character arising out of
or related to this CrediT Agreement, the Notes, or any of the other Loan
Documents or the transactions contemplated or evidenced hereby or thereby, or
the Agent's actions taken hereunder or thereunder, except to the extent that any
of the same shall be directly caused by the Agent's willful misconduct or gross
negligence.
15.8. AGENT AS BANK. In its individual capacity, BKB shall have the
same obligations and the same rights, powers and privileges in respect to its
Commitment and the Loans made by it, and as the holder of any of the Notes and
as the purchaser of any Letter of Credit Participations, as it would have were
it not also the Agent.
15.9. RESIGNATION. The Agent may resign at any time by giving sixty
(60) days prior written notice thereof to the Banks and the Borrower. Upon any
such resignation, the Majority Banks shall have the right to appoint a successor
Agent. Unless a Default or Event of Default shall have occurred and be
continuing, such successor Agent shall be reasonably acceptable to the Borrower.
If no successor Agent shall have been so appointed by the Majority Banks and
shall have accepted such appointment within thirty (30) days after the retiring
Agent's giving of notice of resignation, then the retiring Agent may, on behalf
of the Banks, appoint a successor Agent, which shall be a financial institution
having a rating of not less than A or its equivalent by Standard & Poor's
Corporation. Upon the appointment of and acceptance by a successor Agent and so
long as no Default or Event of Default has occurred and is continuing, the
resigning Agent will pay to the successor Agent a PRO RATA portion of the annual
Agent's fee described in the Agent's Side Letter, calculated by multiplying the
annual amount of such fee by a fraction, the numerator of which is 365 MINUS the
number of days which have elapsed since the Borrower's most recent payment of
such fee and the denominator of which is 365. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Agent, and the retiring Agent shall be discharged
from its duties and obligations hereunder. After any retiring Agent's
resignation, the provisions of this Credit Agreement and the other Loan
Documents shall continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as Agent.
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16. EXPENSES.
The Borrower agrees to pay (a) the reasonable costs of producing and
reproducing this Credit Agreement, the other Loan Documents and the other
agreements and instruments mentioned herein, (b) any taxes (including any
interest and penalties in respect thereto) payable by the Agent or any of the
Banks (other than taxes based upon the Agent's or any Bank's net income) on or
with respect to the transactions contemplated by this Credit Agreement (the
Borrower hereby agreeing to indemnify the Agent and each Bank with respect
thereto), (c) the reasonable fees, expenses and disbursements of the Agent's
Special Counsel or any local counsel to the Agent incurred in connection with
the preparation, administration or interpretation of the Loan Documents and
other instruments mentioned herein, each closing hereunder, and amendments,
modifications, approvals, consents or waivers hereto or hereunder, (d) the
reasonable fees, expenses and disbursements of the Agent incurred by the Agent
in connection with the evaluation of the Borrower and the other Transaction
Parties and with the preparation, administration or interpretation of the Loan
Documents and other instruments mentioned herein, including, without limitation,
commercial finance examination expenses, (e) all reasonable out-of-pocket
expenses (including without limitation reasonable attorneys' fees and costs,
which attorneys may be employees of any Bank or the Agent, and reasonable
consulting, accounting, appraisal, investment banking and similar professional
fees and charges) incurred by any Bank or the Agent in connection with (i) the
enforcement of or preservation of rights under any of the Loan Documents against
the Borrower or any of the other Transaction Parties or the administration
thereof after the occurrence of a Default or Event of Default and (ii) any
litigation, proceeding or dispute whether arising hereunder or otherwise, in any
way related to any Bank's or the Agent's relationship with the Borrower or any
of the other Transaction Parties (but excluding disputes solely between or among
the Banks), and (f) all reasonable fees, expenses and disbursements of any Bank
or the Agent incurred in connection with UCC searches. The covenants of this
ss.16 shall survive payment or satisfaction of all other Obligations.
17. INDEMNIFICATION.
The Borrower agrees to indemnify and hold harmless the Agent and the
Banks from and against any and all claims, actions and suits whether groundless
or otherwise, and from and against any and all liabilities, losses, damages and
expenses of every nature and character arising out of this Credit Agreement or
any of the other Loan Documents or the transactions contemplated hereby
including, without limitation, (a) any actual or proposed use by the Borrower or
any of the other Transaction Parties of the proceeds of any of the Loans or
Letters of Credit, (b) the Borrower or any of the other Transaction Parties
entering into or performing this Credit Agreement or any of the other Loan
Documents or (c) with respect to the Borrower and the other Transaction Parties
and their respective properties and assets, the violation of any Environmental
Law, the presence, disposal, escape, seepage, leakage, spillage, discharge,
emission, release or threatened release of any Hazardous Substances or any
action, suit, proceeding or investigation brought or threatened with respect to
any Hazardous Substances (including, but not limited to, claims with respect to
wrongful death, personal injury or damage to property), in each case including,
without limitation, the reasonable fees and disbursements of counsel and
allocated costs of internal counsel incurred in connection with any such
investigation, litigation or other proceeding; PROVIDED, HOWEVER, that such
indemnity shall not apply to the portion, if any, of any such
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losses, claims, damages, liabilities or related expenses of any Person seeking
indemnification that is determined by a court of competent jurisdiction by final
and nonappealable judgment to have resulted from the willful misconduct or gross
negligence of such Person seeking indemnification. In litigation, or the
preparation therefor, the Banks and the Agent shall be entitled to select their
own counsel and, in addition to the foregoing indemnity, the Borrower agrees to
pay promptly the reasonable fees and expenses of such counsel. If, and to the
extent that the obligations of the Borrower under this ss.17 are unenforceable
for any reason, the Borrower hereby agrees to make the maximum contribution to
the payment in satisfaction of such obligations which is permissible under
applicable law. The covenants contained in this ss.17 shall survive payment or
satisfaction in full of all other Obligations.
18. SURVIVAL OF COVENANTS, ETC.
All covenants, agreements, representations and warranties made herein,
in the Notes, in any of the other Loan Documents or in any documents or other
papers delivered by or on behalf of the Borrower or any of the other Transaction
Parties pursuant hereto shall be deemed to have been relied upon by the Banks
and the Agent, notwithstanding any investigation heretofore or hereafter made by
any of them, and shall survive the making by the Banks of any of the Loans and
the issuance, extension or renewal of any Letters of Credit, as herein
contemplated, and shall continue in full force and effect so long as any Letter
of Credit or any amount due under this Credit Agreement or the Notes or any of
the other Loan Documents remains outstanding or any Bank has any obligation to
make any Loans or the Agent has any obligation to issue, extend or renew any
Letter of Credit, and for such further time as may be otherwise expressly
specified in this Credit Agreement. All statements contained in any certificate
or other paper delivered to any Bank or the Agent at any time by or on behalf of
the Borrower or any of the other Transaction Parties pursuant hereto or in
connection with the transactions contemplated hereby shall constitute
representations and warranties by the Borrower or such other Transaction Party
hereunder.
19. ASSIGNMENT AND PARTICIPATION.
19.1. CONDITIONS TO ASSIGNMENT BY BANKS. Except as provided herein,
each Bank may assign to one or more Eligible Assignees all or a portion of its
interests, rights and obligations under this Credit Agreement (including all or
a portion of its Commitment Percentage and Commitment and the same portion of
the Loans at the time owing to it, the Notes held by it and its participating
interest in the risk relating to any Letters of Credit); PROVIDED that (i) each
of the Agent and, unless a Default or Event of Default shall have occurred and
be continuing, the Borrower shall have given its prior written consent to such
assignment, which consents will not be unreasonably withheld, (ii) each such
assignment shall be of a constant, and not a varying, percentage of all the
assigning Bank's rights and obligations under this Credit Agreement, (iii) each
assignment shall be in an amount that is a whole multiple of $5,000,000, (iv)
each Bank which is a Bank on the date hereof shall retain, free of any such
assignment, an amount of its Commitment of not less than $10,000,000 and (v) the
parties to such assignment shall execute and deliver to the Agent, for recording
in the Register (as hereinafter defined), an Assignment and Acceptance,
substantially in the form of EXHIBIT D hereto (an "Assignment and Acceptance"),
together with any Notes subject to such assignment. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in each Assignment and Acceptance,
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which effective date shall be at least five (5) Business Days after the
execution thereof, (i) the assignee thereunder shall be a party hereto and, to
the extent provided in such Assignment and Acceptance, have the rights and
obligations of a Bank hereunder, and (ii) the assigning Bank shall, to the
extent provided in such assignment and upon payment to the Agent of the
registration fee referred to in ss.19.3, be released from its obligations under
this Credit Agreement.
19.2. CERTAIN REPRESENTATIONS AND WARRANTIES; LIMITATIONS; COVENANTS.
By executing and delivering an Assignment and Acceptance, the parties to the
assignment thereunder confirm to and agree with each other and the other parties
hereto as follows:
(a) other than the representation and warranty that it is the
legal and beneficial owner of the interest being assigned thereby free
and clear of any adverse claim, the assigning Bank makes no
representation or warranty, express or implied, and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Credit Agreement or
the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Credit Agreement, the other Loan Documents
or any other instrument or document furnished pursuant hereto or the
attachment, perfection or priority of any security interest or
mortgage,
(b) the assigning Bank makes no representation or warranty and
assumes no responsibility with respect to the financial condition of
the Borrower and the other Transaction Parties or any other Person
primarily or secondarily liable in respect of any of the Obligations,
or the performance or observance by the Borrower and the other
Transaction Parties or any other Person primarily or secondarily liable
in respect of any of the Obligations of any of their obligations under
this Credit Agreement or any of the other Loan Documents or any other
instrument or document furnished pursuant hereto or thereto;
(c) such assignee confirms that it has received a copy of this
Credit Agreement, together with copies of the most recent financial
statements referred to in ss.7.4 and ss.8.4 And such other documents
and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance;
(d) such assignee will, independently and without reliance upon
the assigning Bank, the Agent or any other Bank and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking
action under this Credit Agreement;
(e) such assignee represents and warrants that it is an Eligible
Assignee;
(f) such assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under this
Credit Agreement and the other Loan Documents as are delegated to the
Agent by the terms hereof or thereof, together with such powers as are
reasonably incidental thereto;
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(g) such assignee agrees that it will perform in accordance with
their terms all of the obligations that by the terms of this Credit
Agreement are required to be performed by it as a Bank;
(h) such assignee represents and warrants that it is legally
authorized to enter into such Assignment and Acceptance; and
(i) such assignee acknowledges that it has made arrangements
with the assigning Bank satisfactory to such assignee with respect to
its PRO RATA share of Letter of Credit Fees in respect of outstanding
Letters of Credit.
19.3. REGISTER. The Agent shall maintain a copy of each Assignment and
Acceptance delivered to it and a register or similar list (the "Register") for
the recordation of the names and addresses of the Banks and the Commitment
Percentage of, and principal amount of the Loans owing to and Letter of Credit
Participations purchased by, the Banks from time to time. The entries in the
Register shall be conclusive, in the absence of manifest error, and the
Borrower, the Agent and the Banks may treat each Person whose name is recorded
in the Register as a Bank hereunder for all purposes of this Credit Agreement.
The Register shall be available for inspection by the Borrower and the Banks at
any reasonable time and from time to time upon reasonable prior notice. Upon
each recordation of an assignment under this ss.19, the assigning or assignee
Bank agrees to pay to the Agent a registration fee in the sum of $3,500.
19.4. NEW NOTES. Upon its receipt of an Assignment and Acceptance
executed by the parties to such assignment, together with each Note subject to
such assignment, the Agent shall (i) record the information contained therein in
the Register, and (ii) give prompt notice thereof to the Borrower and the Banks
(other than the assigning Bank). Within five (5) Business Days after receipt of
such notice, the Borrower, at its own expense, shall execute and deliver to the
Agent, in exchange for each surrendered Note, a new Note to the order of such
Eligible Assignee in an amount equal to the amount assumed by such Eligible
Assignee pursuant to such Assignment and Acceptance and, if the assigning Bank
has retained some portion of its obligations hereunder, a new Note to the order
of the assigning Bank in an amount equal to the amount retained by it hereunder.
Such new Notes shall provide that they are replacements for the surrendered
Notes, shall be in an aggregate principal amount equal to the aggregate
principal amount of the surrendered Notes, shall be dated the effective date of
such in Assignment and Acceptance and shall otherwise be substantially the form
of the assigned Notes. Within five (5) days of issuance of any new Notes
pursuant to this ss.19.4, the Borrower shall deliver an opinion of counsel,
addressed to the Banks and the Agent, relating to the due authorization,
execution and delivery of such new Notes and the legality, validity and binding
effect thereof, in form and substance satisfactory to the Banks. The surrendered
Notes shall be cancelled and returned to the Borrower within a reasonable time
following the issuance of any new Note.
19.5. PARTICIPATIONS. Each Bank may sell Participations to one or more
banks or other entities in all or a portion of such Bank's rights and
obligations under this Credit Agreement and the other Loan Documents; PROVIDED
that (i) each such participation shall be in an amount of not less than
$5,000,000, (ii) any such sale or participation shall not affect the rights and
duties of the selling Bank hereunder to the Borrower and (iii) the only rights
granted to the participant pursuant to such participation arrangements with
respect to
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waivers, amendments or modifications of the Loan Documents shall be the rights
to approve waivers, amendments or modifications that would reduce the principal
of or the interest rate on any Loans, extend the term or increase the amount of
the Commitment of such Bank as it relates to such participant, reduce the amount
of any commitment fees or Letter of Credit Fees to which such participant is
entitled or extend any regularly scheduled payment date for principal or
interest.
19.6. DISCLOSURE. The Borrower agrees that, in addition to disclosures
made in accordance with standard and customary banking practices and in
accordance with the requirements of ss.28 hereof, any Bank may disclose
information obtained by such Bank pursuant to this Credit Agreement to assignees
or participants and potential assignees or participants hereunder; PROVIDED that
such assignees or participants or potential assignees or participants shall
agree (i) to treat in confidence such information unless such information
otherwise becomes public knowledge, (ii) not to disclose such information to a
third party, except as required by law or legal process and (iii) not to make
use of such information for purposes of transactions unrelated to such
contemplated assignment or participation.
19.7. ASSIGNEE OR PARTICIPANT AFFILIATED WITH THE BORROWER. If any
assignee Bank is an Affiliate of the Borrower, then any such assignee Bank shall
have no right to vote as a Bank hereunder or under any of the other Loan
Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or other modifications to any of the Loan Documents or
for purposes of making requests to the Agent pursuant to ss.13.1 or ss.13.2, and
the determination of the Majority Banks shall For all purposes of this Agreement
and the other Loan Documents be made without regard to such assignee Bank's
interest in any of the Loans. If any Bank sells a participating interest in any
of the Loans or Reimbursement Obligations to a participant, and such participant
is the Borrower or an Affiliate of the Borrower, then such transferor Bank shall
promptly notify the Agent of the sale of such participation. A transferor Bank
shall have no right to vote as a Bank hereunder or under any of the other Loan
Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or modifications to any of the Loan Documents or for
purposes of making requests to the Agent pursuant to ss.13.1 or ss.13.2 to the
extent that such participation is beneficially owned by the Borrower or Any
Affiliate of the Borrower, and the determination of the Majority Banks shall for
all purposes of this Agreement and the other Loan Documents be made without
regard to the interest of such transferor Bank in the Loans to the extent of
such participation.
19.8. MISCELLANEOUS ASSIGNMENT PROVISIONS. Any assigning Bank shall
retain its rights to be indemnified pursuant to ss.16 and ss.17 with respect to
any claims or actions arising prior to the date of such assignment. If any
assignee Bank is not incorporated under the laws of the United States of America
or any state thereof, it shall, prior to the date on which any interest or fees
are payable hereunder or under any of the other Loan Documents for its account,
deliver to the Borrower and the Agent certification as to its exemption from
deduction or withholding of any United States federal income taxes. Anything
contained in this ss.19 to the contrary notwithstanding, any Bank may at any
time pledge all or any portion of its interest and rights under this Credit
Agreement (including all or any portion of its Notes) to any of the twelve
Federal Reserve Banks organized under ss.4 of the Federal Reserve Act, 12 U.S.C.
ss.341. No such pledge or the enforcement thereof shall release such pledgor
Bank from its obligations hereunder or under any of the other Loan Documents.
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19.9. ASSIGNMENT BY BORROWER. The Borrower shall not assign or transfer
any of its rights or obligations under any of the Loan Documents without the
prior written consent of each of the Banks.
20. NOTICES, ETC.
Except as otherwise expressly provided in this Credit Agreement, all
notices and other communications made or required to be given pursuant to this
Credit Agreement or the Notes or any Letter of Credit Applications shall be in
writing and shall be delivered in hand, mailed by United States registered or
certified first class mail, postage prepaid, sent by overnight courier, or sent
by telegraph, telecopy, facsimile or telex and confirmed by delivery via courier
or postal service, addressed as follows:
(a) if to the Borrower, at 00X Xxxxx Xxxxxxx, Xxxxx, Xxx
Xxxxxxxxx 00000, Attention: Xxxxxxx X. Xxxxx, or at such other address
for notice as the Borrower shall last have furnished in writing to the
Person giving the notice;
(b) if to the Agent, at 000 Xxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, XXX, Attention: Xxxxxxx X. Xxxxxxx, Vice
President, or Division Executive, or such other address for notice as
the Agent shall last have furnished in writing to the Person giving the
notice; and
(c) if to any Bank, at such Bank's address set forth on SCHEDULE
1 hereto, or such other address for notice as such Bank shall have last
furnished in writing to the Person giving the notice.
Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (i) if delivered by hand, overnight courier or
facsimile to a responsible officer of the party to which it is directed, at the
time of the receipt thereof by such officer or the sending of such facsimile and
(ii) if sent by registered or certified first-class mail, postage prepaid, on
the third Business Day following the mailing thereof.
21. GOVERNING LAW.
THIS CREDIT AGREEMENT AND, EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED
THEREIN, EACH OF THE OTHER LOAN DOCUMENTS ARE CONTRACTS UNDER THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL PURPOSES BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID COMMONWEALTH OF MASSACHUSETTS
(EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE BORROWER
AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS CREDIT AGREEMENT OR ANY OF THE
OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE COMMONWEALTH OF
MASSACHUSETTS OR ANY FEDERAL COURT SITTING THEREIN AND CONSENTS TO THE
NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT
BEING MADE UPON THE BORROWER BY MAIL AT THE ADDRESS SPECIFIED IN SS.21. THE
BORROWER HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE
VENUE OF
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ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT
COURT.
22. HEADINGS.
The captions in this Credit Agreement are for convenience of reference
only and shall not define or limit the provisions hereof.
23. COUNTERPARTS.
This Credit Agreement and any amendment hereof may be executed in
several counterparts and by each party on a separate counterpart, each of which
when executed and delivered shall be an original, and all of which together
shall constitute one instrument. In proving this Credit Agreement it shall not
be necessary to produce or account for more than one such counterpart signed by
the party against whom enforcement is sought.
24. ENTIRE AGREEMENT, ETC.
The Loan Documents and any other documents executed in connection
herewith or therewith express the entire understanding of the parties with
respect to the transactions contemplated hereby. Neither this Credit Agreement
nor any term hereof may be changed, waived, discharged or terminated, except as
provided in ss.26.
25. WAIVER OF JURY TRIAL.
THE BORROWER HEREBY WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO
ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS CREDIT
AGREEMENT, THE NOTES OR ANY OF THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR
OBLIGATIONS HEREUNDER OR THEREUNDER OR THE PERFORMANCE OF SUCH RIGHTS AND
OBLIGATIONS. EXCEPT AS PROHIBITED BY LAW, THE BORROWER HEREBY WAIVES ANY RIGHT
IT MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION REFERRED TO IN THE PRECEDING
SENTENCE ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY
DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES. THE BORROWER (I)
CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY BANK OR THE AGENT HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH BANK OR THE AGENT WOULD NOT, IN
THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS AND (II)
ACKNOWLEDGES THAT THE AGENT AND THE BANKS HAVE BEEN INDUCED TO ENTER INTO THIS
CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY BY, AMONG
OTHER THINGS, THE WAIVERS AND CERTIFICATIONS CONTAINED HEREIN.
26. CONSENTS, AMENDMENTS, WAIVERS, ETC.
Any consent or approval required or permitted by this Credit Agreement
to be given by all of the Banks may be given, and any term of this Credit
Agreement, the other Loan Documents or any other instrument related hereto or
mentioned herein may be amended, and the performance or observance by the
Borrower or any of the other Transaction Parties of any terms of this Credit
Agreement, the other Loan Documents or such other instrument
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or the continuance of any Default or Event of Default may be waived (either
generally or in a particular instance and either retroactively or prospectively)
with, but only with, the written consent of the Borrower and the written consent
of the Majority Banks. Notwithstanding the foregoing, the rate of interest on
the Notes (other than interest accruing pursuant to ss.5.10.2 following the
effective date of any waiver by the Majority Banks of the Default or Event oF
Default relating thereto), the term of the Notes, the amount of the Commitments
of the Banks, and the amount of commitment fee or Letter of Credit Fees
hereunder may not be changed, and no scheduled date for the payment of
principal, interest or fees may be postponed or extended without the written
consent of the Borrower and the written consent of each Bank affected thereby;
the definition of Majority Banks and the terms of this Section 26 may not be
amended and no collateral or guaranty may be released without the written
consent of all of the Banks; and the amount of the Agent's Fee or any Letter of
Credit Fees payable for the Agent's account and ss.15 may not be amended without
the written consent of the Agent. No waiver shall extend to or affect any
obligation not expressly waived or impair any right consequent thereon. No
course of dealing or delay or omission on the part of the Agent or any Bank in
exercising any right shall operate as a waiver thereof or otherwise be
prejudicial thereto. No notice to or demand upon the Borrower shall entitle the
Borrower to other or further notice or demand in similar or other circumstances.
27. SEVERABILITY.
The provisions of this Credit Agreement are severable and if any one
clause or provision hereof shall be held invalid or unenforceable in whole or in
part in any jurisdiction, then such invalidity or unenforceability shall affect
only such clause or provision, or part thereof, in such jurisdiction, and shall
not in any manner affect such clause or provision in any other jurisdiction, or
any other clause or provision of this Credit Agreement in any jurisdiction.
28. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.
28.1. SHARING OF INFORMATION WITH SECTION 20 SUBSIDIARY. The Borrower
acknowledges that from time to time financial advisory, investment banking and
other services may be offered or provided to the Borrower in connection with
this Credit Agreement or otherwise, by a Section 20 Subsidiary. The Borrower
hereby authorizes (a) such Section 20 Subsidiary to share with the Agent and
each Bank any information delivered to such Section 20 Subsidiary by the
Borrower, and (b) the Agent and each Bank to share with such Section 20
Subsidiary any information delivered to the Agent or such Bank by the Borrower
pursuant to this Credit Agreement, or in connection with the decision of such
Bank to enter into this Credit Agreement; it being understood, in each case,
that any such Section 20 Subsidiary receiving such information shall be bound by
the confidentiality provisions of this Credit Agreement. Such authorization
shall survive the payment and satisfaction in full of all of the Obligations.
28.2. CONFIDENTIALITY. Each of the Agent and the Banks agree to keep
any information delivered or made available to it by or on behalf of the
Borrower or any of the other Transaction Parties confidential from anyone other
than its employees, officers, attorneys and other advisors or any Section 20
Subsidiary, PROVIDED that nothing herein shall prevent the Agent or such Bank
from disclosing such information upon the order or
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request of any court or administrative agency or authority, upon the request or
demand of any regulatory agency or authority, to the extent that such
information has been publicly disclosed other than as a result of a disclosure
by the Agent or such Bank, otherwise as required by law or to any actual or
potential assignee or participant hereof pursuant to ss.19.6. The Borrower
agrees that it will, and will cause each of the other Transaction Parties to,
keep any information delivered or made available to it by or on behalf of the
Agent or any of the Banks (including, without limitation, the amount of any fees
payable to the Agent pursuant to ss.5.1 and the Agent's Side Letter)
confidential from anyone other that its employees, officers, attorneys and other
advisors, PROVIDED that nothing herein shall prevent the Borrower from
disclosing such information upon the order or request of any court or
administrative agency or authority, upon the request or demand of any regulatory
agency or authority, to the extent that such information has been publicly
disclosed other than as a result of disclosure by the Borrower or any of the
other Transaction Parties, or otherwise as required by law.
28.3. PRIOR NOTIFICATION. Unless specifically prohibited by applicable
law or court order, each of the Banks and the Agent shall, prior to disclosure
thereof, notify the Borrower of any request for disclosure of any such
non-public information by any governmental agency or representative thereof
(other than any such request in connection with an examination of the financial
condition of such Bank or the Agent by such governmental agency) or pursuant to
legal process.
28.4. OTHER. In no event shall any Bank or the Agent be obligated or
required to return any materials furnished to it or any Section 20 Subsidiary by
the Borrower. The obligations of each Bank under this ss.28 shall supersede and
replace the obligations of such Bank under any confidentiality letter in respect
of this financing signed and delivered by such Bank to the Borrower prior to the
date hereof and shall be binding upon any assignee of, or purchaser of any
participation in, any interest in any of the Loans or Reimbursement Obligations
from any Bank.
29. TRANSITIONAL ARRANGEMENTS
29.1. PRIOR CREDIT AGREEMENT SUPERSEDED. This Agreement shall supersede
the Original Credit Agreement in its entirety, except as provided in this ss.29.
On the Closing Date, the rights and obligations of the parties (other than the
Exiting Banks) under the Original Credit Agreement and the "Notes" (as defined
in the Original Credit Agreement) issued in favor of the Banks (as defined in
the Original Credit Agreement) under the Original Credit Agreement (other than
any rights available to the Agent and the Banks (as defined in the Original
Credit Agreement) under ss.16 and ss.17 of the Original Credit Agreement), shall
be subsumed within and be governed by this Credit Agreement and the other Loan
Documents, PROVIDED, HOWEVER, that each of the "Loans" (as defined in the
Original Credit Agreement) outstanding under the Original Credit Agreement on
the Closing Date shall, for purposes of this Credit Agreement, be Loans, and
shall continue to bear interest or be subject to fees at the respective rates in
effect immediately prior to the Closing Date, with the Borrower being
responsible for, and hereby confirming its obligation to pay, any breakage costs
associated with the payment of Eurodollar Rate Loans under the Original Credit
Agreement on a date which is not the last day of the applicable Interest Period
(as defined in the Original Credit Agreement) with respect thereto; and PROVIDED
FURTHER that the rights and obligations of the Exiting Banks under the Original
Credit
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Agreement and the related Loan Documents (as defined in the Original Credit
Agreement) shall be terminated in accordance with the terms of, and upon the
Exiting Banks' receipt of the payment specified in the separate pay-off letters
dated as of the date hereof among each Exiting Bank, the Company and the Agent.
29.2. RETURN AND CANCELLATION OF NOTES. Upon its receipt of its Note or
Notes hereunder on the Closing Date, each Bank will promptly return to the
Company, marked "Canceled", any notes of the Company held by such Bank pursuant
to the Original Credit Agreement.
29.3. FEES UNDER SUPERSEDED AGREEMENT. All commitment, Agent's and
other fees and expenses owing or accruing under or in respect of the Original
Credit Agreement through the Closing Date shall be calculated as of the Closing
Date (prorated in the case of any fractional periods), and shall be paid in
accordance with the method, and on the dates, specified in the Original Credit
Agreement, as if the Original Credit Agreement were still in effect.
[Remainder of page intentionally left blank]
74
IN WITNESS WHEREOF, the undersigned have duly executed this Credit
Agreement as a sealed instrument as of the date first set forth above.
HADCO CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Chief Financial Officer
BANKBOSTON, N.A., individually and as Agent
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
ABN AMRO BANK N.V.
By: /s/Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
THE BANK OF TOKYO - MITSUBISHI TRUST COMPANY
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ Xxxxxxx X. XxXxxxxx
-----------------------------------------
Name: Xxxxxxx X. XxXxxxxx
Title: First Vice President
75
KEYBANK NATIONAL ASSOCIATION.
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION
By: /s/ Xxxxx X. Xxxxxxxxxxx, Xx.
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxxxx, Xx.
Title: Vice President
THE BANK OF NOVA SCOTIA
By: /s/ [unreadable]
-----------------------------------------
Name:
Title: Authorized Signatory
THE FUJI BANK, LIMITED
By: /s/ Xxxxxxxx Xxxxxxxxx
-----------------------------------------
Name: Xxxxxxxx Xxxxxxxxx
Title: Sr. Vice President & Group Head
SUNTRUST BANK, ATLANTA
By: /s/ W. Xxxxx Xxxxxx
-----------------------------------------
Name: W. Xxxxx Xxxxxx
Title: Group Vice President
By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Vice President
THE INDUSTRIAL BANK OF JAPAN, LIMITED
By: /s/ J. Xxxxxxx Xxxxxx
-----------------------------------------
Name: J. Xxxxxxx Xxxxxx
Title: Senior Vice President
76
CORESTATES BANK, N.A.
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President
STATE STREET BANK AND TRUST COMPANY
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
MELLON BANK, N.A.
By: /s/ R. Xxxx Wisdrieck
-----------------------------------------
Name:
Title:
THE SANWA BANK, LIMITED
By: /s/ Takayoshi Futae
-----------------------------------------
Name: Takayoshi Futae
Title: Deputy General Manager
THE SUMITOMO BANK, LIMITED
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President & Manager
By: /s/ Xxxxxx DeGennis
-----------------------------------------
Name: Xxxxxx DeGennis
Title: Vice President
