Exhibit 10.1
NINTH AMENDMENT TO
REVOLVING CREDIT AGREEMENT
This NINTH AMENDMENT TO REVOLVING CREDIT AGREEMENT dated as of February
16, 2007 (the "Ninth Amendment"), is entered into by and among INTERSTATE
BAKERIES CORPORATION, a Delaware corporation ("Parent Borrower"), a debtor and
debtor-in-possession in a case pending under Chapter 11 of the Bankruptcy
Code, each of the direct and indirect subsidiaries of the Parent Borrower
party to the Credit Agreement (as defined below) (each individually a
"Subsidiary Borrower" and collectively the "Subsidiary Borrowers"; and
together with the Parent Borrower, the "Borrowers"), each of which is a debtor
and debtor-in-possession in a case pending under Chapter 11 of the Bankruptcy
Code, JPMORGAN CHASE BANK, N.A., a national banking association (formerly
known as JPMorgan Chase Bank) ("JPMCB"), and each of the other commercial
banks, finance companies, insurance companies or other financial institutions
or funds from time to time party to the Credit Agreement (together with JPMCB,
the "Lenders"), JPMORGAN CHASE BANK, N.A., a national banking association
(formerly known as JPMorgan Chase Bank), as administrative agent (the
"Administrative Agent") for the Lenders, and JPMORGAN CHASE BANK, N.A., a
national banking association (formerly known as JPMorgan Chase Bank), as
collateral agent (the "Collateral Agent") for the Lenders.
WITNESSETH:
WHEREAS, the Borrowers, the Lenders, the Administrative Agent and the
Collateral Agent are parties to that certain Revolving Credit Agreement dated
as of September 23, 2004, as amended by that certain First Amendment to
Revolving Credit Agreement dated as of November 1, 2004, by that certain
Second Amendment to Revolving Credit Agreement dated as of January 20, 2005,
by that certain Third Amendment and Waiver to Revolving Credit Agreement dated
as of May 26, 2005, by that certain Fourth Amendment and Waiver to Revolving
Credit Agreement dated as of November 30, 2005, by that certain Fifth
Amendment to Revolving Credit Agreement dated as of December 27, 2005, by that
certain Sixth Amendment and Waiver to Revolving Credit Agreement dated as of
March 29, 2006, by that certain Seventh Amendment to Revolving Credit
Agreement dated as of June 28, 2006 and by that certain Eighth Amendment to
Revolving Credit Agreement dated as of August 25, 2006, pursuant to which the
Lenders have made available to the Borrowers a revolving credit and letter of
credit facility in an aggregate principal amount not to exceed $200,000,000
(as so amended, the "Credit Agreement");
WHEREAS, upon the occurrence of the Ninth Amendment Effectiveness Date
(as hereinafter defined), each of the Amended and Restated Lenders (as
hereinafter defined) shall be deemed to have become, by executing and
delivering this Ninth Amendment, a party to the Credit Agreement (as in effect
after giving effect to this Ninth Amendment) in the form of Exhibit A hereto
as a "Lender" and shall have the rights and obligations of a Lender thereunder
and each of the Amended and Restated Lenders shall have the interest(s) shown
opposite its name on Annex A to the Credit Agreement (as in effect after
giving effect to this Ninth Amendment) (each such Lender, an "Amended and
Restated Lender"); and
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1
Section 1. Definitions. Capitalized terms used and not otherwise defined
in this Ninth Amendment are used as defined in the Credit Agreement (after
giving effect to this Ninth Amendment). In addition, the capitalized term
"Ninth Amendment Effectiveness Date" shall mean the first Business Day on
which the conditions set forth in Section 3 hereof are fully satisfied to the
satisfaction of the Administrative Agent or waived by the Administrative
Agent. The Administrative Agent will give the Borrowers and each Lender
written notice of the occurrence of the Ninth Amendment Effectiveness Date.
Section 2. Amendments to Credit Agreement. Subject to the conditions set
forth in Section 3 hereof, the Credit Agreement is hereby amended and restated
as follows:
2.1 Each of the provisions of the Credit Agreement which appear with
computerized underscoring are inserted and each of the provisions which
appear with computerized strike-through are deleted in the document
annexed hereto as Exhibit A.
2.2 The signature pages of the Credit Agreement are hereby amended
and restated to conform to the signature pages hereto.
2.3 Annex A to the Credit Agreement (as in effect prior to giving
effect to this Ninth Amendment) is hereby replaced in its entirety by
Annex A to the document attached as Exhibit A hereto.
Section 3. Effectiveness. The effectiveness of this Ninth Amendment and
the amendment and restatement of the Credit Agreement are subject to the
following conditions precedent:
3.1 Supporting Documents. The Administrative Agent shall have
received for each of the Borrowers:
3.1.1 bring-down certificates delivered by each Borrower (A)
certifying that there were no changes, or providing the text of
changes, to the Organizational Documents of such Borrower as
delivered pursuant to Section 4.1(a) of the Credit Agreement and (B)
to the effect that each Borrower is in good standing in its
jurisdiction of incorporation, organization or formation;
3.1.2 signature and incumbency certificates of the officers of
such Borrower executing the Loan Documents to which it is a party,
dated as of the Ninth Amendment Effectiveness Date;
3.1.3 duly adopted resolutions of the board of directors or
similar governing body of each Borrower approving and authorizing
the execution, delivery and performance of this Ninth Amendment,
certified as of the Ninth Amendment Effectiveness Date by its
secretary or assistant secretary as being in full force and effect
without modification or amendment; and
3.1.4 such other documents as the Administrative Agent may
reasonably request.
3.2 Amendment Order. Not later than February 28, 2007, the
Administrative Agent and the Lenders shall have received a certified copy
of the Amendment Order in substantially the form of Exhibit B attached
hereto or such other form as otherwise agreed by the Administrative Agent
and the Debtors and which Amendment Order (i) shall be in full force and
effect, (ii) shall not have been stayed, reversed, modified or amended in
any respect, except as approved by the Administrative Agent in its sole
discretion, (iii) shall approve or otherwise reaffirm the payment by the
Borrowers of all of the Fees set forth in Sections 2.19, 2.20 and 2.21 of
the Credit Agreement and in Section 3.6 hereof, (iv) shall be entered
with the consent or non-objection of a preponderance (as determined by
the Administrative Agent in its sole discretion) of the secured creditors
of any of the Borrowers under the Pre-Petition Credit Agreement, and (v)
if the Amendment Order is the subject of a pending appeal in any respect,
neither the making of such Loan nor the issuance of such Letter of Credit
nor the performance by any of the Borrowers of any of their obligations
under the Credit Agreement as amended and restated by this Ninth
Amendment or under the Loan Documents or under any other instrument or
agreement referred to therein shall be the subject of a presently
effective stay pending appeal.
3.3 Loan Documents. Each Borrower, each Amended and Restated Lender
and the Administrative Agent shall have signed a counterpart of this
Ninth Amendment (whether the same or different counterparts) and shall
have delivered the same to the Administrative Agent.
3.4 Opinion of Counsel. The Administrative Agent and the Lenders
shall have received the favorable written opinion of counsel to the
Borrowers, acceptable to the Administrative Agent, substantially in the
form of Exhibit C.
3.5 Employment Contract with Chief Executive Officer. The Parent
Borrower shall have obtained an order of the Bankruptcy Court approving
the employment agreement between the Parent Borrower and a chief
executive officer of the Parent Borrower, which order shall be
substantially in the form of Exhibit D attached hereto and shall not have
been stayed, reversed, modified or amended in any respect, except as
approved by the Administrative Agent in its sole discretion, and which
employment agreement shall be in form and substance acceptable to the
Administrative Agent.
3.6 Payment of Fees and Expenses. The Borrowers shall have paid to
the Administrative Agent (a) any unpaid balance of the fees and expenses
due and payable by the Borrowers pursuant to the Loan Documents and (b)
the then unpaid balance of all accrued and unpaid Fees due under and
pursuant to: (i) the fee letter dated as of January 31, 2007 among the
Borrowers, JPMCB and JPMSI and (ii) the letters referred to in Section
2.19 of the Credit Agreement (as in effect immediately prior to the Ninth
Amendment Effectiveness Date).
3.7 Closing Documents. The Administrative Agent shall have received
all documents required by this Ninth Amendment satisfactory in form and
substance to the Administrative Agent in its exclusive discretion.
Section 4. Payments upon Effectiveness. On the Ninth Amendment
Effectiveness Date, (i) the Commitments of the Lenders under the Credit
Agreement before giving effect to this
Ninth Amendment who are not Amended and Restated Lenders (collectively, the
"Terminating Lenders") shall be terminated, (ii) simultaneously and
concurrently with the termination of the commitments of the Terminating
Lenders, the Amended and Restated Lenders shall make or be deemed to have
made, as the case may be, to the extent necessary, non-pro rata Loans to the
Borrowers or additional non-pro rata Loans, as the case may be, to the
Borrowers in accordance with their respective Commitments after giving effect
to this Ninth Amendment in an aggregate amount necessary to repay in full the
outstanding principal amount of the Loans of the Terminating Lenders, (iii) if
any Letters of Credit are outstanding on the Ninth Amendment Effectiveness
Date, the undivided interests and participations therein of the Terminating
Lenders shall terminate and each of the Amended and Restated Lenders shall be
deemed to have purchased from the Fronting Bank pursuant to Section 2.3(e) of
the Credit Agreement an undivided interest and participation in such Letters
of Credit to the extent of such Amended and Restated Lender's Commitment
percentage, (iv) the Borrowers shall pay any accrued but unpaid interest and
Fees owing to the Terminating Lenders as of the Ninth Amendment Effectiveness
Date and (v) the Terminating Lenders shall no longer be Lenders under the
Credit Agreement.
Section 5. Representations and Warranties. Each Borrower represents and
warrants to the Lenders that:
5.1 After giving effect to the Ninth Amendment and the amendment and
restatement of the Credit Agreement and taking into account all prior
written waivers and amendments in respect of the Credit Agreement, the
representations and warranties of the Borrowers contained in Section 3 of
the Credit Agreement are true and correct in all material respects on and
as of the date hereof as if such representations and warranties had been
made on and as of the date hereof (except to the extent that any such
representations and warranties specifically relate to an earlier date);
and
5.2 After giving effect to the Ninth Amendment and the amendment and
restatement of the Credit Agreement and taking into account all prior
written waivers and amendments in respect of the Credit Agreement, (i)
each Borrower is in compliance with all the terms and provisions set
forth in the Credit Agreement, and (ii) no Event of Default has occurred
and is continuing or would result from the execution, delivery and
performance of this Ninth Amendment.
Section 6. Choice of Law. THIS NINTH AMENDMENT SHALL IN ALL RESPECTS BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED WHOLLY WITHIN SUCH STATE AND
THE BANKRUPTCY CODE.
Section 7. Full Force and Effect. Except as specifically amended or
waived hereby, all of the terms and conditions of the Credit Agreement shall
remain in full force and effect, and the same are hereby ratified and
confirmed. No reference to this Ninth Amendment need be made in any instrument
or document at any time referring to the Credit Agreement, and a reference to
the Credit Agreement in any such instrument or document shall be deemed a
reference to the Credit Agreement as amended hereby.
Section 8. Counterparts; Electronic Signatures. This Ninth Amendment may
be executed in any number of counterparts, each of which shall constitute an
original, but all of which
taken together shall constitute one and the same agreement. The Administrative
Agent may, in its discretion, agree to accept notices and other communications
to it hereunder by electronic communications pursuant to procedures approved
by it; provided that approval of such procedures may be limited to particular
notices or communications.
Section 9. Headings. Section headings used herein are for convenience
only and are not to affect the construction of or be taken into consideration
in interpreting this Ninth Amendment.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this Ninth Amendment
to be duly executed as of the day and the year first written.
BORROWERS:
INTERSTATE BAKERIES CORPORATION
By: /s/ J. Xxxxxxx Xxxxx
-----------------------------------------
Name: J. Xxxxxxx Xxxxx
Title: Senior Vice President - Finance & Treasurer
ARMOUR AND MAIN REDEVELOPMENT CORPORATION
By: /s/ J. Xxxxxxx Xxxxx
-----------------------------------------
Name: J. Xxxxxxx Xxxxx
Title: Treasurer
XXXXX'X INN QUALITY BAKED GOODS, LLC
By: /s/ J. Xxxxxxx Xxxxx
-----------------------------------------
Name: J. Xxxxxxx Xxxxx
Title: Treasurer
IBC SALES CORPORATION
By: /s/ J. Xxxxxxx Xxxxx
-----------------------------------------
Name: J. Xxxxxxx Xxxxx
Title: Senior Vice President - Finance & Treasurer
IBC SERVICES, LLC
By: /s/ J. Xxxxxxx Xxxxx
-----------------------------------------
Name: J. Xxxxxxx Xxxxx
Title: Treasurer
IBC TRUCKING, LLC
By: /s/ J. Xxxxxxx Xxxxx
-----------------------------------------
Name: J. Xxxxxxx Xxxxx
Title: Treasurer
INTERSTATE BRANDS CORPORATION
By: /s/ J. Xxxxxxx Xxxxx
-----------------------------------------
Name: J. Xxxxxxx Xxxxx
Title: Senior Vice President - Finance & Treasurer
NEW ENGLAND BAKERY DISTRIBUTORS, L.L.C.
By: /s/ J. Xxxxxxx Xxxxx
-----------------------------------------
Name: J. Xxxxxxx Xxxxx
Title: Treasurer
LENDERS:
JPMORGAN CHASE BANK, N.A.
Individually and as Administrative Agent and Collateral
Agent
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Managing Director
NATIONWIDE LIFE INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Authorized Signatory
THE FOOTHILL GROUP, INC.
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxx
Title: Senior Vice President
GENERAL ELECTRIC CAPITAL CORPORATION
By: /s/ Xxxxxx X. Xxxx
-----------------------------------------
Name: Xxxxxx X. Xxxx
Title: Duly Authorized Signator
BLACKPORT CAPITAL FUND LTD.
By: /s/ Xxxxx Xxxxx
-----------------------------------------
Name: Xxxxx Xxxxx
Title: Director
THE BANK OF NEW YORK
By: /s/ Xxxxx X. Xxxx
-----------------------------------------
Name: Xxxxx X. Xxxx
Title: Vice President
DK ACQUISITION PARTNERS, L.P.
By: X.X. Xxxxxxxx & Co., its general partner
By: /s/ Xxxxxxx Xxxxxxxx
-----------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: General Partner
PROSPECT HARBOR CREDIT PARTNERS, LP
By: /s/ Xxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Chief Compliance Officer
Assistant Secretary
SANKATY HIGH YIELD PARTNERS II, L.P.
By: /s/ Xxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Chief Compliance Officer
Assistant Secretary
SPCP GROUP, LLC
By: /s/ Xxxxxxx Xxxxxxxx
-----------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Authorized Signatory
CANADIAN IMPERIAL BANK OF COMMERCE
By: /s/ Xxxx X'Xxxx
-----------------------------------------
Name: Xxxx X'Xxxx
Title: Authorized Signatory
GRAND CENTRAL ASSET TRUST, BDC SERIES
By: /s/ Xxxxx Xxxxxxx
-----------------------------------------
Name: Xxxxx Xxxxxxx
Title: Attorney-In-Fact
SPIRET IV LOAN TRUST 2003-B
By: Wilmington Trust Company not in its
individual capacity but solely as trustee
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Sr. Financial Services Officer
CAPITALSOURCE FINANCE LLC
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: President - Healthcare & Specialty
Finance
HIGHLAND FLOATING RATE ADVANTAGE FUND
By: /s/ M. Xxxxx Xxxxxxxxx
-----------------------------------------
Name: M. Xxxxx Xxxxxxxxx
Title: Treasurer
HIGHLAND FLOATING RATE LLC
By: /s/ M. Xxxxx Xxxxxxxxx
-----------------------------------------
Name: M. Xxxxx Xxxxxxxxx
Title: Treasurer
EXHIBIT A
FORM OF AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
--------------------------------------------------------------------------------
AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
--------------------------------------------------------------------------------
Among
INTERSTATE BAKERIES CORPORATION,
a Debtor and Debtor-in-Possession under Chapter 11 of the Bankruptcy Code,
as Parent Borrower,
CERTAIN OF THE DIRECT AND INDIRECT SUBSIDIARIES
OF INTERSTATE BAKERIES CORPORATION,
Debtors and Debtors-in-Possession under Chapter 11 of the Bankruptcy Code,
as Subsidiary Borrowers,
and
THE LENDERS PARTY HERETO,
and
JPMORGAN CHASE BANK, N.A.
as Administrative Agent
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Dated as of February 16, 2007
AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
TABLE OF CONTENTS
Page No.
SECTION 1. DEFINITIONS.......................................................2
SECTION 1.1 Defined Terms................................................2
SECTION 1.2 Terms Generally.............................................24
SECTION 1.3 Accounting Terms; GAAP......................................24
SECTION 2. AMOUNT AND TERMS OF CREDIT.......................................25
SECTION 2.1 Commitment of the Lenders...................................25
SECTION 2.2 Availability of Commitment; Borrowing Base..................25
SECTION 2.3 Letters of Credit...........................................26
SECTION 2.4 Issuance....................................................28
SECTION 2.5 Nature of Letter of Credit Obligations Absolute.............28
SECTION 2.6 Making of Loans.............................................29
SECTION 2.7 Repayment of Loans and Unreimbursed Draws;
Evidence of Debt...........................................29
SECTION 2.8 Interest on Loans...........................................30
SECTION 2.9 Default Interest............................................31
SECTION 2.10 Optional Termination or Reduction of Commitment.............31
SECTION 2.11 Alternate Rate of Interest..................................31
SECTION 2.12 Refinancing of Loans........................................31
SECTION 2.13 Mandatory Prepayment; Commitment Termination................32
SECTION 2.14 Optional Prepayment of Loans; Reimbursement
of Lenders................................................33
SECTION 2.15 Reserve Requirements; Change in Circumstances...............35
SECTION 2.16 Change in Legality..........................................36
SECTION 2.17 Pro Rata Treatment, etc.....................................37
SECTION 2.18 Taxes.......................................................37
SECTION 2.19 Certain Fees................................................40
SECTION 2.20 Commitment Fee..............................................40
SECTION 2.21 Letter of Credit Fees.......................................40
SECTION 2.22 Nature of Fees..............................................40
SECTION 2.23 Priority and Liens..........................................40
SECTION 2.24 Use of Cash Collateral......................................42
SECTION 2.25 Right of Set-Off............................................42
SECTION 2.26 Security Interest in Letter of Credit Account...............43
SECTION 2.27 Payment of Obligations......................................43
SECTION 2.28 No Discharge; Survival of Claims............................43
SECTION 2.29 Replacement of Certain Lenders..............................43
SECTION 3. REPRESENTATIONS AND WARRANTIES...................................44
SECTION 3.1 Organization and Authority..................................44
i
SECTION 3.2 Due Execution...............................................44
SECTION 3.3 Statements Made.............................................45
SECTION 3.4 Financial Statements........................................45
SECTION 3.5 Ownership...................................................46
SECTION 3.6 Liens.......................................................46
SECTION 3.7 Compliance with Law.........................................46
SECTION 3.8 Insurance...................................................46
SECTION 3.9 The Orders..................................................46
SECTION 3.10 Use of Proceeds.............................................47
SECTION 3.11 Litigation..................................................47
SECTION 3.12 Intellectual Property.......................................47
SECTION 3.13 Taxes.......................................................47
SECTION 3.14 Investment Company Act; Other Regulations...................47
SECTION 3.15 ERISA Matters...............................................47
SECTION 4. CONDITIONS OF LENDING............................................48
SECTION 4.1 Conditions Precedent to Initial Loan and Initial Letter of
Credit....................................................48
SECTION 4.2 Conditions Precedent to Each Loan and Each Letter of Credit.50
SECTION 5. AFFIRMATIVE COVENANTS............................................52
SECTION 5.1 Financial Statements, Reports, etc..........................52
SECTION 5.2 Existence...................................................55
SECTION 5.3 Insurance...................................................55
SECTION 5.4 Obligations and Taxes.......................................56
SECTION 5.5 Notice of Event of Default, etc.............................56
SECTION 5.6 Access to Books and Records.................................56
SECTION 5.7 Maintenance of Concentration Account........................57
SECTION 5.8 Borrowing Base Certificate..................................57
SECTION 5.9 Compliance with Laws........................................58
SECTION 5.10 Environmental Laws..........................................58
SECTION 5.11 CEO.........................................................58
SECTION 6. NEGATIVE COVENANTS...............................................58
SECTION 6.1 Liens.......................................................58
SECTION 6.2 Merger, etc.................................................59
SECTION 6.3 Indebtedness................................................59
SECTION 6.4 Capital Expenditures........................................59
SECTION 6.5 EBITDA......................................................59
SECTION 6.6 Guarantees and Other Liabilities............................60
SECTION 6.7 Chapter 11 Claims...........................................60
SECTION 6.8 Dividends; Capital Stock....................................60
SECTION 6.9 Transactions with Affiliates................................61
SECTION 6.10 Investments, Loans and Advances.............................61
SECTION 6.11 Disposition of Assets.......................................61
ii
SECTION 6.12 Nature of Business..........................................61
SECTION 6.13 Transactions among Borrowers................................61
SECTION 6.14 Right of Subrogation among Borrowers........................61
SECTION 6.15 Derivative Agreements.......................................61
SECTION 6.16 Reorganization Plan.........................................62
SECTION 6.17 Cash Restructuring Charges..................................62
SECTION 7. EVENTS OF DEFAULT................................................62
SECTION 7.1 Events of Default...........................................62
SECTION 8. THE ADMINISTRATIVE AGENT.........................................66
SECTION 8.1 Administration by Administrative Agent......................66
SECTION 8.2 Advances and Payments.......................................66
SECTION 8.3 Sharing of Setoffs..........................................67
SECTION 8.4 Agreement of Required Lenders...............................67
SECTION 8.5 Liability of Administrative Agent...........................67
SECTION 8.6 Reimbursement and Indemnification...........................68
SECTION 8.7 Rights of Administrative Agent..............................68
SECTION 8.8 Independent Lenders.........................................68
SECTION 8.9 Notice of Transfer..........................................69
SECTION 8.10 Successor Administrative Agent..............................69
SECTION 9. MISCELLANEOUS....................................................69
SECTION 9.1 Notices.....................................................69
SECTION 9.2 Survival of Agreement, Representations and
Warranties, etc...........................................70
SECTION 9.3 Successors and Assigns......................................70
SECTION 9.4 Confidentiality.............................................73
SECTION 9.5 Expenses....................................................73
SECTION 9.6 Indemnity...................................................74
SECTION 9.7 Choice of Law...............................................74
SECTION 9.8 No Waiver...................................................74
SECTION 9.9 Extension of Maturity.......................................74
SECTION 9.10 Amendments, etc.............................................74
SECTION 9.11 Severability................................................76
SECTION 9.12 Headings....................................................76
SECTION 9.13 Execution in Counterparts...................................76
SECTION 9.14 Prior Agreements; Inconsistencies...........................76
SECTION 9.15 Further Assurances..........................................76
SECTION 9.16 Waiver of Jury Trial........................................76
SECTION 9.17 Subordination of Intercompany Indebtedness..................76
SECTION 9.18 Certain Post Closing Matters................................77
SECTION 9.19 USA Patriot Act.............................................79
iii
Annex A - Commitment Amounts
Exhibit A - Form of Interim Order
Exhibit A-1 - Form of Amendment Order Approving Eighth Amendment to Revolving
Credit Agreement Exhibit
A-2 - Form of Amendment Order Approving Ninth Amendment to Revolving Credit
Agreement
Exhibit B - Form of Security and Pledge Agreement
Exhibit C-1 - Form of Weekly Borrowing Base Certificate
Exhibit C-2 - Form of Monthly Borrowing Base Certificate
Exhibit D - Form of Opinion of Counsel
Exhibit E - Form of Assignment and Acceptance
Schedule 1.1 - Eligible Real Property
Schedule 3.5 - Subsidiaries
Schedule 3.6 - Liens
Schedule 3.12 - Intellectual Property
Schedule 6.9 - Transactions with Affiliates
Schedule 6.10 - Other Investments
Schedule 6.13 - Borrower Transaction Restrictions
iv
AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
Dated as of February 16, 2007
AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT, dated as of
February 16, 2007, among INTERSTATE BAKERIES CORPORATION, a Delaware
corporation ("Parent Borrower"), a debtor and debtor-in-possession in a case
pending under Chapter 11 of the Bankruptcy Code, and each of the direct and
indirect subsidiaries of the Parent Borrower party to this Agreement (each
individually a "Subsidiary Borrower" and collectively the "Subsidiary
Borrowers"; and together with the Parent Borrower, the "Borrowers"), each of
which is a debtor and debtor-in-possession in a case pending under Chapter 11 of
the Bankruptcy Code (the cases of the Borrowers, each a "Case" and collectively,
the "Cases"), JPMORGAN CHASE BANK, N.A., a national banking association
(formerly known as JPMorgan Chase Bank) ("JPMCB"), and each of the other
commercial banks, finance companies, insurance companies or other financial
institutions or funds from time to time party hereto (together with JPMCB, the
"Lenders"), X.X. XXXXXX SECURITIES INC., as lead arranger and book runner,
JPMORGAN CHASE BANK, N.A. (formerly known as JPMorgan Chase Bank), as
administrative agent (in such capacity, the "Administrative Agent") for the
Lenders, and JPMORGAN CHASE BANK N.A. (formerly known as JPMorgan Chase Bank),
as collateral agent (in such capacity, the "Collateral Agent") for the Lenders.
INTRODUCTORY STATEMENT
WHEREAS, on September 22, 2004, the Borrowers filed voluntary
petitions with the Bankruptcy Court initiating the Cases and have continued in
the possession of their assets and in the management of their businesses
pursuant to Sections 1107 and 1108 of the Bankruptcy Code; and
WHEREAS, the Borrowers have applied to the Lenders for a revolving
credit and letter of credit facility in an aggregate principal amount not to
exceed $200,000,000 (subject to the terms and conditions of this Agreement); and
WHEREAS, the proceeds of the Loans will be used for (i) working
capital, letters of credit and capital expenditures; (ii) other general
corporate purposes of the Borrowers; (iii) payment of any related transaction
costs, fees and expenses; and (iv) the costs of administration of the Cases, all
as provided for herein; and
WHEREAS, to provide for the repayment of the Loans, the reimbursement
of any draft drawn under a Letter of Credit and the payment of the other
obligations of the Borrowers hereunder and under the other Loan Documents
(including, without limitation, the Obligations of the Borrowers under Section
6.3(v)), the Borrowers will provide to the Administrative Agent and the Lenders
the following (each as more fully described herein):
(a) an allowed Superpriority Claim;
(b) a perfected first priority Lien, pursuant to Section 364(c)(2) of
the Bankruptcy Code, upon all unencumbered property of the Borrowers and on all
cash and cash equivalents in the Letter of Credit Account, provided that
following the Termination Date,
amounts in the Letter of Credit Account shall not be subject to the Carve-Out
hereinafter referred to;
(c) a perfected Lien, pursuant to Section 364(c)(3) of the Bankruptcy
Code, upon all property of the Borrowers that is subject to valid and perfected
Permitted Liens in existence on the Filing Date or that is subject to valid
Permitted Liens in existence on the Filing Date that are perfected subsequent to
the Filing Date as permitted by Section 546(b) of the Bankruptcy Code; and
(d) a perfected first priority priming Lien, pursuant to Section
364(d)(1) of the Bankruptcy Code, upon all property of the Borrowers (including,
without limitation, inventory, accounts receivable, rights under license
agreements, and property, plant and equipment), that is subject to the existing
Liens (the "Primed Liens") which secure (i) the obligations of the Borrowers to
the lenders party to the Pre-Petition Credit Agreement, and (ii) other
obligations or indebtedness of the Borrowers, which first priority priming Lien
in favor of the Administrative Agent and the Lenders shall be senior in all
respects to all of the Primed Liens; and
WHEREAS, all of the claims granted hereunder in the Cases to the
Administrative Agent and the Lenders shall be subject to the Carve-Out to the
extent provided in Section 2.23.
Accordingly, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
SECTION 1.1 Defined Terms.
As used in this Agreement, the following terms shall have the meanings
specified below:
"ABA Pension Plan" shall mean the American Bakers Association
Retirement Plan, a defined benefit pension plan established in 1961 to provide
pension benefits to certain employees of several unrelated companies in the
baking industry, including, without limitation, the Borrowers.
"ABR Loan" shall mean any Loan bearing interest at a rate determined
by reference to the Alternate Base Rate in accordance with the provisions of
Section 2.
"Account" shall mean any right to payment for goods sold in the
ordinary course of business, regardless of how such right is evidenced and
whether or not it has been earned by performance.
"Account Debtor" means, with respect to any Account, the obligor with
respect to such Account.
"Act" shall have the meaning given such term in Section 9.19.
"Additional Credit" shall have the meaning given such term in Section
4.2(d).
2
"Adjusted Eligible Accounts Receivable" shall mean Eligible Accounts
Receivable, minus the Dilution Reserve.
"Adjusted LIBOR Rate" shall mean, with respect to any Eurodollar
Borrowing for any Interest Period, an interest rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to the quotient of (i) the LIBOR
Rate in effect for such Interest Period divided by (ii) a percentage (expressed
as a decimal) equal to 100% minus Statutory Reserves. For purposes hereof, the
term "LIBOR Rate" shall mean the rate (rounded upwards, if necessary, to the
next 1/16 of 1%) at which dollar deposits approximately equal in principal
amount to such Eurodollar Borrowing and for a maturity comparable to such
Interest Period are offered to the principal London office of the Administrative
Agent in immediately available funds in the London interbank market at
approximately 11:00 a.m., London time, two (2) Business Days prior to the
commencement of such Interest Period.
"Administrative Agent" shall have the meaning set forth in the
Introduction.
"Administrative Questionnaire" means an Administrative Questionnaire
in a form supplied by the Administrative Agent.
"Affected Lender" shall have the meaning given such term in Section
2.29.
"Affiliate" shall mean, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under common
control with, such Person. For purposes of this definition, a Person (a
"Controlled Person") shall be deemed to be "controlled by" another Person (a
"Controlling Person") if the Controlling Person possesses, directly or
indirectly, power to direct or cause the direction of the management and
policies of the Controlled Person whether by contract or otherwise.
"Agreement" shall mean this Amended and Restated Revolving Credit
Agreement, as the same may from time to time be amended, restated, modified or
supplemented.
"Alternate Base Rate" shall mean, for any day, a rate per annum
(rounded upwards, if necessary, to the next 1/16 of 1%) equal to the greatest of
(a) the Prime Rate in effect on such day, (b) the Base CD Rate in effect on such
day plus 1% and (c) the Federal Funds Effective Rate in effect on such day plus
1/2 of 1%. For purposes hereof, "Prime Rate" shall mean the rate of interest per
annum publicly announced from time to time by the Administrative Agent as its
prime rate in effect at its principal office in New York City; each change in
the Prime Rate shall be effective on the date such change is publicly announced.
"Base CD Rate" shall mean the sum of (i) the quotient of (a) the Three-Month
Secondary CD Rate divided by (b) a percentage expressed as a decimal equal to
100% minus Statutory Reserves and (ii) the Assessment Rate. "Three-Month
Secondary CD Rate" shall mean, for any day, the secondary market rate for
three-month certificates of deposit reported as being in effect on such day (or,
if such day shall not be a Business Day, the next preceding Business Day) by the
Board through the public information telephone line of the Federal Reserve Bank
of New York (which rate will, under the current practices of the Board, be
published in Federal Reserve Statistical Release H.15(519) during the week
following such day), or, if such rate shall not be so reported on such day or
such next preceding Business Day, the average of the secondary market quotations
for
3
three-month certificates of deposit of major money center banks in New York City
received at approximately 10:00 a.m., New York City time, on such day (or, if
such day shall not be a Business Day, on the next preceding Business Day) by the
Administrative Agent from three New York City negotiable certificate of deposit
dealers of recognized standing selected by it. "Federal Funds Effective Rate"
shall mean, for any day, 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 on the next succeeding Business Day by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for the day of such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it. If for any reason the
Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable to ascertain the Base CD
Rate or the Federal Funds Effective Rate or both for any reason, including the
inability or failure of the Administrative Agent to obtain sufficient quotations
in accordance with the terms hereof, the Alternate Base Rate shall be determined
without regard to clause (ii) of the first sentence of this definition, as
appropriate, until the circumstances giving rise to such inability no longer
exist. Any change in the Alternate Base Rate due to a change in the Prime Rate,
the Three-Month Secondary CD Rate or the Federal Funds Effective Rate shall be
effective on the effective date of such change in the Prime Rate, the
Three-Month Secondary CD Rate or the Federal Funds Effective Rate, respectively.
"Amendment Order" shall mean, collectively, (i) an order of the
Bankruptcy Court in substantially the form of Exhibit A-1 approving the Eighth
Amendment to Revolving Credit Agreement and (ii) an order of the Bankruptcy
Court in substantially the form of Exhibit A-2 approving the Ninth Amendment to
Revolving Credit Agreement dated as of February 16, 2007, or in each case
such other forms as otherwise agreed by the Administrative Agent and the
Borrowers.
"Amounts" shall have the meaning given such term in Section 2.18(a).
"Approved Fund" means, with respect to any Lender that is a fund that
invests in bank loans and similar commercial extensions of credit, any other
fund that invests in bank loans and similar commercial extensions of credit and
is managed by the same investment advisor as such Lender or by a Lender
Affiliate of such investment advisor.
"Assessment Rate" shall mean for any date the annual rate (rounded
upwards, if necessary, to the next 1/100 of 1%) most recently estimated by the
Administrative Agent as the then current net annual assessment rate that will be
employed in determining amounts payable by the Administrative Agent to the
Federal Deposit Insurance Corporation (or any successor) for insurance by such
Corporation (or any successor) of time deposits made in dollars at the
Administrative Agent's domestic offices.
"Asset Sale" shall mean a sale, lease or sub-lease (as lessor or
sublessor), sale and leaseback, assignment, conveyance, transfer or other
disposition to, or any exchange of property with, any Person (other than a
Borrower), in one transaction or series of transactions, of all or any part of
the Borrowers' or any of their Subsidiaries' businesses, assets or properties of
any kind, whether real, personal, or mixed and whether tangible or intangible,
whether now owned or hereafter acquired, including, without limitation, the
capital stock of any of the Borrowers (other
4
than the Parent Borrower) or their Subsidiaries in each case other than (i)
Inventory, including scrap or obsolete Inventory, sold in the ordinary course of
business, and (ii) sales of assets for aggregate consideration of less than
$100,000 with respect to any transaction or series of related transactions.
"Assignment and Acceptance" shall mean an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the
Administrative Agent, substantially in the form of Exhibit E.
"Available Cash" means, on any date, (a) the fair market value on such
date of cash and cash equivalents held in securities accounts of the Borrowers
and their Subsidiaries, and (b) the amount of available funds held on such date
in bank deposit accounts of the Borrowers and their Subsidiaries.
"Available Commitment" shall have the meaning given to such term in
Section 2.2(b).
"Bankruptcy Code" shall mean The Bankruptcy Reform Act of 1978, as
heretofore and hereafter amended, and codified as 11 U.S.C. Section 101 et seq.
"Bankruptcy Court" shall mean the United States Bankruptcy Court for
the Western District of Missouri or any other court having jurisdiction over the
Cases from time to time.
"Board" shall mean the Board of Governors of the Federal Reserve
System of the United States.
"Borrowers" shall have the meaning set forth in the Introduction.
"Borrowing" shall mean the incurrence of Loans of a single Type made
from all the Lenders on a single date and having, in the case of Eurodollar
Loans, a single Interest Period (with any ABR Loan made pursuant to Section 2.16
being considered a part of the related Borrowing of Eurodollar Loans).
"Borrowing Base" shall mean, at the time of any determination, an
amount equal to the sum, without duplication, of (a) 85% of Adjusted Eligible
Accounts Receivable plus (b) 40% of Eligible Inventory, plus (c) the Real
Property Component, minus (d) the amount of the Environmental Reserve at such
time, minus (e) the Carve-Out. The Borrowing Base at any time shall be
determined by reference to the most recent Borrowing Base Certificate delivered
to the Administrative Agent pursuant to Section 5.8 of the Agreement. Subject to
the limitations and requirements set forth in Section 9.10(a) of the Agreement,
standards of eligibility and reserves and advance rates of the Borrowing Base
may be revised and adjusted from time to time by the Administrative Agent in its
sole discretion, with any changes in such standards to be effective three (3)
Business Days after delivery of notice thereof to the Borrowers.
"Borrowing Base Certificate" shall mean a certificate substantially in
the form of Exhibit C-1 hereto (with respect to the certificate to be delivered
by the Borrowers weekly) and Exhibit C-2 hereto (with respect to the certificate
to be delivered by the Borrowers monthly)
5
(in each case with such changes therein as may be required by the Administrative
Agent from time to time to reflect the components of and reserves against the
Borrowing Base as provided for hereunder from time to time), executed and
certified as accurate and complete by a Financial Officer of each of the
Borrowers, which shall include appropriate exhibits, schedules and supporting
documentation, and additional reports as (i) outlined in Exhibits C-1 and C-2,
(ii) as requested by the Administrative Agent, and (iii) as provided in Section
5.8.
"Budget" shall have the meaning set forth in Section 5.1(g).
"Budget Acceptance Date" shall have the meaning set forth in Section
2.2(c).
"Business Day" shall mean any day other than a Saturday, Sunday or
other day on which banks in the State of New York are required or
permitted to close (and, for a Letter of Credit, other than a day on
which the Fronting Bank issuing such Letter of Credit is closed);
provided, however, that when used in connection with a Eurodollar Loan,
the term "Business Day" shall also exclude any day on which banks are not
open for dealings in dollar deposits on the London interbank market.
"Capital Expenditures" shall mean, for any period, the aggregate of
all expenditures (whether paid in cash and not theretofore accrued subsequent to
the date of this Agreement or accrued as liabilities during such period and
including that portion of Capitalized Leases which is capitalized on the
consolidated balance sheet of the Borrowers and their Subsidiaries) by the
Borrowers and their Subsidiaries during such period that, in conformity with
GAAP, are required to be included in or reflected by the property, plant,
equipment or intangibles or similar fixed asset accounts reflected in the
consolidated balance sheet of the Borrowers and their Subsidiaries (including
equipment which is purchased simultaneously with the trade-in of existing
equipment owned by any of the Borrowers or their Subsidiaries to the extent of
the gross amount of such purchase price less the book value of the equipment
being traded in at such time), but excluding expenditures made in connection
with the replacement or restoration of assets, to the extent reimbursed or
financed from insurance proceeds paid on account of the loss of or the damage to
the assets being replaced or restored, or from awards of compensation arising
from the taking by condemnation or eminent domain of such assets being replaced.
"Capitalized Lease" shall mean, as applied to any Person, any lease of
property by such Person as lessee which would be capitalized on a balance sheet
of such Person prepared in accordance with GAAP.
"Carve-Out" shall have the meaning set forth in Section 2.23(a).
"Cases" has the meaning set forth in the Introduction.
"Change of Control" shall mean with respect to the Parent Borrower and
any Subsidiary Borrower: (i) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934 and the rules of the Securities
and Exchange Commission thereunder as in effect on the date hereof), of shares
representing more than 25% of the aggregate ordinary voting power represented by
the issued and outstanding capital stock of such Borrower; or (ii) the
occupation of a majority of the
6
seats (other than vacant seats) on the board of directors of such Borrower,
after the Filing Date, by Persons who were neither (a) nominated by the board of
directors of such Borrower nor (b) appointed by the directors so nominated.
"Closing Date" shall mean the date on which this Agreement has been
executed and the conditions precedent to the making of the initial Loans set
forth in Section 4.1 have been satisfied or waived, which date shall occur as
promptly as is practicable after the date of this Agreement, but in no event
later than ten (10) days following the entry of the Interim Order.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Collateral" shall mean the Collateral described in the Security and
Pledge Agreement.
"Collateral Agent" shall have the meaning set forth in the
Introduction.
"Commitment" shall mean the commitment of each Lender hereunder to
make Loans and to issue and/or participate in Letters of Credit in the amount
set forth opposite its name on Annex A hereto or as may subsequently be set
forth in the Register from time to time, as the same may be reduced from time to
time pursuant to the terms of this Agreement.
"Commitment Fee" shall have the meaning set forth in Section 2.20.
"Commitment Letter" shall mean that certain Commitment Letter dated
September 20, 2004 among the Administrative Agent, X.X. Xxxxxx Securities, Inc.
and the Borrowers.
"Commitment Fee Percentage" shall mean 0.50% per annum.
"Commitment Percentage" shall mean at any time, with respect to each
Lender, the percentage obtained by dividing its Commitment at such time by the
Total Commitment, as applicable, at such time.
"Consolidated EBITDA" shall mean, for any period, all as determined in
accordance with GAAP and subject to such modifications as may be satisfactory to
the Administrative Agent, the consolidated net income (or net loss) of the
Borrowers for such period, plus (a) the sum of (i) depreciation expense, (ii)
amortization expense, (iii) other non-cash charges, (iv) net total Federal,
state and local income tax expense, (v) gross interest expense for such period
less gross interest income for such period, (vi) extraordinary losses, (vii) any
restructuring charge, (viii) non-cash expenses related to the ABA Pension Plan
exceeding $320,000 per fiscal monthly period, and (ix) "Chapter 11 expenses" (or
"administrative costs reflecting Chapter 11 expenses", inclusive of professional
fees) as shown on the Borrowers' consolidated statement of income for such
period, less (b) extraordinary gains.
"Consummation Date" shall mean the date of the substantial
consummation (as defined in Section 1101 of the Bankruptcy Code and which for
purposes of this Agreement shall be no later than the effective date) of a
Reorganization Plan of the Borrowers that is confirmed pursuant to an order of
the Bankruptcy Court in the Cases.
7
"Default" shall have the meaning given such term in Section 2.23(a).
"Dilution Factors" shall mean, without duplication, with respect to
any period, the aggregate amount of all deductions, credit memos, returns,
adjustments, allowances, bad debt write-offs and other non-cash credits which
are recorded to reduce accounts receivable in a manner consistent with current
and historical accounting practices of the Borrowers.
"Dilution Ratio" shall mean, at any date, the amount (expressed as a
percentage) equal to (a) the aggregate amount of the applicable Dilution Factors
for the twelve (12) most recently ended fiscal months divided by (b) total gross
sales for the twelve (12) most recently ended fiscal months.
"Dilution Reserve" shall mean, at any date, the applicable Dilution
Ratio multiplied by the Eligible Accounts Receivable on such date, but only to
the extent the Dilution Ratio exceeds 5%.
"Dollars" and "$" shall mean lawful money of the United States of
America.
"Domestic Subsidiary" shall mean any Subsidiary incorporated,
organized or formed under the laws of any jurisdiction of the United States.
"Eligible Assignee" shall mean (i) a commercial bank having total
assets in excess of $1,000,000,000; (ii) a finance company, insurance company or
other financial institution or fund, in each case acceptable to the
Administrative Agent, which in the ordinary course of business extends credit of
the type contemplated herein and has total assets in excess of $200,000,000 and
whose becoming an assignee would not constitute a prohibited transaction under
Section 4975 of ERISA; and (iii) any other financial institution satisfactory to
the Borrowers and the Administrative Agent.
"Eligible Accounts Receivable" means, at the time of any determination
thereof, each Account that satisfies the following criteria at the time of
creation and continues to meet the same at the time of such determination: such
Account (i) has been invoiced to, and represents the bona fide amounts due to
the Borrowers from, the purchaser of goods or services, in each case originated
in the ordinary course of business of the Borrowers and (ii) in each case is
subject to the Borrowers' corporate accounts receivable credit and collection
policies, procedures and practices and (iii) is not ineligible for inclusion in
the calculation of the Borrowing Base pursuant to any of clauses (a) through (s)
below or otherwise deemed by the Administrative Agent in its sole discretion to
be ineligible for inclusion in the calculation of the Borrowing Base as
described below. Without limiting the foregoing, to qualify as Eligible Accounts
Receivable, an Account shall indicate no person other than a Borrower as payee
or remittance party. In determining the amount to be so included, the face
amount of an Account shall be reduced by, without duplication, to the extent not
reflected in such face amount, (i) the amount of all accrued and actual
discounts, claims, credits or credits pending, promotional program allowances,
price adjustments, finance charges or other allowances (including any amount
that the Borrowers, as applicable, may be obligated to rebate to a customer
pursuant to the terms of any agreement or understanding (written or oral)), (ii)
the aggregate amount of all limits and deductions provided for in this
definition and elsewhere in this Agreement and (iii) the aggregate amount of all
cash
8
received in respect of such Account but not yet applied by the Borrowers to
reduce the amount of such Account. Unless otherwise approved from time to time
in writing by the Administrative Agent (subject to the limitations and
requirements set forth in Section 9.10(a)), no Account shall be an Eligible
Account Receivable if, without duplication:
(a) the relevant Borrower does not have sole lawful and absolute title
to such Account; or
(b) the Account (i) is unpaid more than fifty-six (56) days from the
original date of invoice or (ii) has been written off the books of the Borrowers
or has been otherwise designated on such books as uncollectible; or
(c) more than 50% in face amount of all Accounts of the same Account
Debtor are ineligible pursuant to clause (b) above; or
(d) the Account Debtor is insolvent or the subject of any bankruptcy
case or insolvency proceeding of any kind or is of uncertain credit quality, as
determined by the Administrative Agent in its exclusive discretion; or
(e) the Account is not payable in Dollars or the Account Debtor is
either not organized under the laws of the United States of America, any State
thereof, or the District of Columbia or is located outside or has its principal
place of business or substantially all of its assets outside the United States,
except to the extent the Account is supported by an irrevocable letter of credit
satisfactory to the Administrative Agent (as to form, substance and issuer) and
assigned to and directly drawable by the Administrative Agent; or
(f) the Account Debtor is the United States of America or any
department, agency or instrumentality thereof, unless the relevant Borrower duly
assigns its rights to payment of such Account to the Administrative Agent
pursuant to the Assignment of Claims Act of 1940, as amended, which assignment
and related documents and filings shall be in form, and substance satisfactory
to the Administrative Agent; or
(g) the Account is supported by a security deposit (to the extent
received from the applicable Account Debtor), progress payment, retainage or
other similar advance made by or for the benefit of the applicable Account
Debtor, in each case to the extent thereof; or
(h) (i) it is not subject to a valid and perfected first priority Lien
in favor of the Administrative Agent for the benefit of the Secured Parties,
subject to no other Liens other than Liens (if any) permitted by the Loan
Documents or (ii) it does not otherwise conform in all material respects to the
representations and warranties contained in the Loan Documents relating to
Accounts; or
(i) such Account was invoiced (i) in advance of goods or services
provided, or (ii) twice, or (iii) the associated income has not been earned; or
(j) such Account is a non-trade Account or relates to payment of
interest or is classified as a note receivable by the Borrowers in accordance
with the Borrowers' current and historical practices; or
9
(k) the sale to the Account Debtor is on a xxxx-and-hold, guaranteed
sale, sale-and-return, ship-and-return, sale on approval, extended terms or
consignment or other similar basis or made pursuant to any other written
agreement providing for repurchase or return of any merchandise which has been
claimed to be defective or otherwise unsatisfactory; or
(l) the goods giving rise to such Account have not been shipped and
title has not been transferred to the Account Debtor, or the Account represents
a progress-billing or otherwise does not represent a completed sale; for
purposes hereof "progress-billing" means any invoice for goods sold or leased or
services rendered under a contract or agreement pursuant to which the Account
Debtor's obligation to pay such invoice is conditioned upon a Borrower's
completion of any further performance under the contract or agreement; or
(m) the Account arises out of a sale made by a Borrower to an
employee, officer, agent, director, stockholder, Subsidiary or Affiliate of a
Borrower, or the Account Debtor is an Affiliate of a Borrower; or
(n) such Account was not paid in full, and the Borrower created a new
receivable for the unpaid portion of the Account, without the agreement of the
customer, and other Accounts constituting chargebacks, debit memos and other
adjustments for unauthorized deductions; or
(o) the Account is created on cash on delivery terms; or
(p) the Account Debtor (i) is a creditor of a Borrower, (ii) has, may
assert, has asserted or is reasonably expected to assert a right of set-off
against a Borrower or (iii) has disputed or is reasonably expected to dispute
its liability (whether by chargeback or otherwise) or made, may make or is
reasonably expected to make any claim with respect to the Account or any other
Account of a Borrower which has not been resolved, in each case, without
duplication, to the extent of the amount owed by such Borrower to the Account
Debtor, the amount of such actual or asserted right of set-off, or the amount of
such dispute or claim, as the case may be; or
(q) the Account does not comply in all material respects with the
requirements of all applicable laws and regulations, whether Federal, state or
local, including without limitation the Federal Consumer Credit Protection Act,
the Federal Truth in Lending Act and Regulation Z of the Board; or
(r) to all or any part of such Account, a check, promissory note,
draft, trade acceptance or other Instrument for the payment of money has been
received, presented for payment and returned uncollected for any reason; or
(s) the Account is for goods that have been sold under a purchase
order or pursuant to the terms of a contract or other agreement or understanding
(written or oral) that indicates that any Person other than the Borrowers has or
has had or has purported to have or have had an ownership interest in such
goods.
Notwithstanding the foregoing, all Accounts of any single Account
Debtor and its Affiliates which, in the aggregate exceed (i) 30% in respect of
Account Debtors whose securities are rated Investment Grade or (ii) 10% in
respect of all other Account Debtors, of the total
10
amount of all Eligible Accounts Receivable at the time of any determination
shall be deemed not to be Eligible Accounts Receivable to the extent of such
excess. In determining the aggregate amount of Accounts from the same Account
Debtor that are unpaid more than fifty-six (56) days from the date of invoice
pursuant to clause (b) above, there shall be excluded the amount of any net
credit balances relating to Accounts with invoice dates more than fifty-six
(56) days prior to the date of determination. Furthermore, no Account shall be
an Eligible Account Receivable if it is for goods that have been sold under a
purchase order or pursuant to the terms of a contract or other agreement or
understanding (written or oral) that indicates that any Person other than a
Borrower has or has had or has purported to have or have had an ownership
interest in such goods.
"Eligible Finished Goods" shall mean Finished Goods that are (i) first
quality, (ii) located at plants and distribution centers owned by a Borrower,
(iii) scheduled for delivery in the ordinary course of business, and (iv)
otherwise constitute Eligible Inventory.
"Eligible Inventory" shall mean, on any date, the Inventory Value of
the Borrowers on such date deemed by the Administrative Agent in its sole
discretion to be eligible for inclusion in the calculation of the Borrowing
Base. Without limiting the foregoing, to qualify as "Eligible Inventory", no
Person other than the Borrowers shall have any direct or indirect ownership
interest or title to such Inventory. Unless otherwise from time to time approved
in writing by the Administrative Agent (subject to the limitations and
requirements set forth in Section 9.10(a)), no Inventory shall be deemed
Eligible Inventory if (and without duplication):
(a) it is not owned solely by the Borrowers or the Borrowers do not
have sole and good, valid and unencumbered title thereto; or
(b) it is not located in the United States; or
(c) it is not either (i) located on property owned by the Borrowers,
(ii) located in a third party warehouse or in another location not owned by the
Borrowers, and, at the sole discretion of the Borrowers, either (A) covered by
Landlord Lien Waiver or bailee letter, as applicable, in each case in form and
substance reasonably acceptable to the Administrative Agent, or (B) a Rent
Reserve has been taken with respect to such Inventory or (iii) located at a
closed facility owned or leased by the Borrowers; or
(d) it is not subject to a valid and perfected first priority Lien in
favor of the Administrative Agent, except, with respect to Inventory stored at
sites described in clause (c) above, for Liens for unpaid rent or normal and
customary warehousing charges, in each case, not yet paid, to the extent of such
unpaid rent or charges; or
(e) it is goods returned or rejected due to quality issues by the
Borrowers' customers or goods in transit to third parties (other than to
warehouse sites described in clause (c) above); or
(f) it is seconds or thirds or stale or is obsolete or slow moving or
unmerchantable, or overstock or excess or does not otherwise conform to the
representations and warranties contained in the Loan Documents; or
11
(g) it is comprised of operating supplies, packaging, film, pallets,
and/or other shipping materials or supplies, labels, repair or maintenance
parts, fuel, tires, paint, cartons used in production or other containers, and
any other such material not considered used for sale by the Administrative Agent
from time to time, in the Administrative Agent's sole discretion; or
(h) the Borrowers classify such item as a sample item on their
perpetual inventory records, or the Borrowers use such item for marketing or
display; or
(i) it is a discontinued product or component thereof; or
(j) any portion of the Inventory Value thereof is attributable to
intercompany profit among the Borrowers or their Affiliates; or
(k) any Inventory that is damaged or marked for return to vendor; or
(l) any Inventory that is Work-In-Process or Finished Goods other than
Eligible Finished Goods; or
(m) it is consigned or at a customer location but still accounted for
in the Borrowers' perpetual inventory balance; or
(n) it is classified as "bakery outlet," "dry products," "Xxx.
Xxxxxxxx'x" or "crouton" inventory.
"Eligible Real Property' means the real property listed on Schedule
1.1 (or otherwise reasonably acceptable to the Administrative Agent and owned by
any of the Borrowers: (i) that is acceptable in the sole discretion of the
Administrative Agent for inclusion in the Real Property Component, (ii) in
respect of which an appraisal report has been delivered to the Administrative
Agent in form, scope and substance reasonably satisfactory to the Administrative
Agent; (iii) in respect of which the Administrative Agent is satisfied that all
actions necessary or desirable in order to create valid first priority and
subsisting Liens on such real property have been taken, including, without
limitation, any action requested by the Administrative Agent under Section
2.23(b), (iv) in respect of which an environmental assessment report has been
completed and delivered to the Administrative Agent in form and substance
satisfactory to the Administrative Agent and which does not indicate any
non-compliance with or liability under, or remediation action with respect to,
any Environmental Law, and (v) if required by the Administrative Agent, which is
adequately protected by fully-paid valid title insurance with endorsements and
in amounts acceptable to the Administrative Agent, insuring that the
Administrative Agent for the benefit of the Secured Parties, shall have valid
first and subsisting Liens on such real property, evidence of which shall have
been provided in form and substance satisfactory to the Administrative Agent.
"Environmental Laws" shall mean all laws, statutes, ordinances,
orders, rules, regulations, plans, policies or decrees and the like relating to
(i) environmental matters, including, without limitation, those relating to
fines, injunctions, penalties, damages, contribution, cost recovery
compensation, losses or injuries resulting from the release or threatened
release of "Hazardous Waste" or "Hazardous Substances" (as such terms are
defined in any applicable Environmental Law), (ii) the generation, use, storage,
transportation or
12
disposal of Hazardous Waste or Hazardous Substance, or (iii) occupational safety
and health, public health and safety, industrial hygiene or protection of
wetlands, in any manner applicable to the Borrowers or any of their respective
properties, including, without limitation, the Comprehensive Environmental
Response, Compensation, and Liability Act (42 U.S.C. ss. 9601 et seq.), the
Hazardous Materials Transportation Act (49 U.S.C. ss. 1801 et seq.,), the
Resource Conservation and Recovery Act (42 U.S.C. ss. 6901 et seq.), the Federal
Water Pollution Control Act (33 U.S.C. ss. 1251 et seq.), the Clean Air Act (42
U.S.C. ss. 7401 et seq.), the Toxic Substances Control Act (15 U.S.C. ss. 2601
et seq.), the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C.
ss.136 et seq.), the Occupational Safety and Health Act (29 U.S.C. ss. 651 et
seq.), and the Emergency Planning and Community Right-to-Know Act (42 U.S.C. ss.
11001 et seq.), each as amended or supplemented, and any analogous future or
present local, state and federal statutes and regulations promulgated pursuant
thereto, each as in effect as of the date of determination.
"Environmental Lien" shall mean a Lien in favor of any Governmental
Authority for (i) any liability under federal or state Environmental Laws, or
(ii) damages arising from or costs incurred by such Governmental Authority in
response to a release or threatened release of a hazardous or toxic waste,
substance or constituent, or other substance into the environment.
"Environmental Reserve" means a reserve determined by the
Administrative Agent in its sole discretion for costs associated with (a) the
generation, use, handling, transportation, storage, treatment or disposal of any
Hazardous Materials, (b) exposure to any Hazardous Materials or (c) any Release.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"ERISA Affiliate" shall mean any trade or business (whether or not
incorporated) which is a member of a group of which any of the Borrowers is a
member and which is under common control within the meaning of Section 414(b) or
(c) of the Code and the regulations promulgated and rulings issued thereunder.
"Eurocurrency Liabilities" shall have the meaning assigned thereto in
Regulation D issued by the Board, as in effect from time to time.
"Eurodollar Borrowing" shall mean a Borrowing comprised of Eurodollar
Loans.
"Eurodollar Loan" shall mean any Loan bearing interest at a rate
determined by reference to the Adjusted LIBOR Rate in accordance with the
provisions of Section 2.
"Event of Default" shall have the meaning given such term in Section
7.
"Facilities" shall mean any and all real property (including, without
limitation, all buildings, fixtures or other improvements located thereon) now,
hereafter or heretofore owned, leased, operated or used by the Borrowers (but
only as to portions of buildings actually leased or
13
used) or any of their respective predecessors or any of their respective
Affiliates that are directly or indirectly controlled by the Borrowers.
"Fees" shall collectively mean the Commitment Fees, Letter of Credit
Fees and other fees referred to in Sections 2.19, 2.20 and 2.21.
"Filing Date" shall mean September 22, 2004.
"Final Order" shall have the meaning given such term in Section
4.2(d).
"Financial Officer" shall mean the Chief Financial Officer, Controller
or Treasurer of the Parent Borrower or a Subsidiary Borrower, as the case may
be.
"Finished Goods" shall mean completed goods which require no
additional processing or manufacturing to be sold to third party customers by
the Borrowers in the ordinary course of business.
"Forecast" shall have the meaning given such term in Section 5.1(e).
"Fronting Bank" shall mean JPMCB or such other commercial bank as may
agree with JPMCB to act in such capacity and shall be reasonably satisfactory to
the Borrowers and the Administrative Agent.
"GAAP" shall mean accounting principles generally accepted in the
United States and applied in accordance with Section 1.2.
"Governmental Authority" shall mean any Federal, state, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality or any court, in each case whether of the United States or
foreign.
"Hazardous Substances" shall have the meaning given such term in the
defined term "Environmental Laws".
"Hazardous Waste" shall have the meaning given such term in the
defined term "Environmental Laws".
"Indebtedness" shall mean, at any time and with respect to any Person:
(i) all indebtedness of such Person for borrowed money; (ii) all indebtedness of
such Person for the deferred purchase price of property or services (other than
property, including inventory, and services purchased, and expense accruals and
deferred compensation items arising, in the ordinary course of business); (iii)
all obligations of such Person evidenced by notes, bonds, debentures or other
similar instruments (other than performance, surety and appeal bonds arising in
the ordinary course of business); (iv) all indebtedness of such Person created
or arising under any conditional sale or other title retention agreement with
respect to property acquired by such Person (even though the rights and remedies
of the seller or lender under such agreement in the event of default are limited
to repossession or sale of such property); (v) all obligations of such Person
under leases which have been or should be, in accordance with GAAP, recorded as
capital leases, to the extent required to be so recorded; (vi) all
reimbursement, payment or similar
14
obligations of such Person, contingent or otherwise, under acceptance, letter of
credit or similar facilities and all obligations of such Person in respect of:
(x) currency swap agreements, currency future or option contracts and other
similar agreements designed to hedge against fluctuations in foreign currency
exchange rates, (y) interest rate swap, cap or collar agreements and interest
rate future or option contracts and other similar agreements designed to hedge
against fluctuations in interest rates, and (z) swap agreements, future or
option contracts and other similar agreements designed to hedge against
fluctuations in commodities prices; (vii) all indebtedness referred to in
clauses (i) through (vi) above guaranteed directly or indirectly by such Person,
or in effect guaranteed directly or indirectly by such Person through an
agreement (a) to pay or purchase such indebtedness or to advance or supply funds
for the payment or purchase of such indebtedness, (b) to purchase, sell or lease
(as lessee or lessor) property, or to purchase or sell services, primarily for
the purpose of enabling the debtor to make payment of such indebtedness or to
assure the holder of such indebtedness against loss in respect of such
indebtedness, (c) to supply funds to or in any other manner invest in the debtor
(including any agreement to pay for property or services irrespective of whether
such property is received or such services are rendered) or (d) otherwise to
assure a creditor against loss in respect of such indebtedness, and (viii) all
indebtedness referred to in clauses (i) through (vii) above secured by (or for
which the holder of such indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in property (including, without
limitation, accounts and contract rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such indebtedness.
"Indemnified Party" shall have the meaning given such term in Section
9.6.
"Insufficiency" shall mean, with respect to any Plan, the amount, if
any, of its unfunded benefit liabilities within the meaning of Section
4001(a)(18) of ERISA.
"Intercompany Indebtedness" shall mean any claim of an Affiliate of a
Borrower against any other Affiliate of a Borrower, any claim of a Borrower
against any of its Affiliates, and any claim of any Affiliate of a Borrower
against a Borrower.
"Interest Payment Date" shall mean (i) as to any Eurodollar Loan, the
last day of each consecutive thirty (30) day period running from the
commencement of the applicable Interest Period, and (ii) as to all ABR Loans,
the last calendar day of each month and the date on which any ABR Loans are
refinanced with Eurodollar Loans pursuant to Section 2.12.
"Interest Period" shall mean, as to any Borrowing of Eurodollar Loans,
the period commencing on the date of such Borrowing (including as a result of a
refinancing of ABR Loans) or on the last day of the preceding Interest Period
applicable to such Borrowing and ending on the numerically corresponding day (or
if there is no corresponding day, the last day) in the calendar month that is
one, three or six months thereafter, as the Borrowers may elect in the related
notice delivered pursuant to Section 2.6(b) or 2.12; provided, however, that (i)
if any Interest Period would end on a day which shall not be a Business Day,
such Interest Period shall be extended to the next succeeding Business Day
unless such next succeeding Business Day would fall in the next calendar month,
in which case such Interest Period shall end on the next preceding Business Day,
and (ii) no Interest Period shall end later than the Termination Date.
15
"Interim Commitment" shall have the meaning given such term in Section
2.2(a).
"Interim Order" shall have the meaning given such term in Section
4.1(b).
"Interim Period" shall have the meaning given such term in Section
2.2(a).
"Inventory" shall mean all Raw Materials, Work-in-Process, and
Finished Goods held by the Borrowers in the normal course of business.
"Inventory Reserves" means the following, each as determined by the
Administrative Agent from time to time:
(a) a reserve for shrink, or discrepancies that arise pertaining to
inventory quantities on hand between the Borrowers' perpetual accounting system,
and physical counts of the Inventory, but not less than 2% of the Eligible
Inventory; or
(b) a reserve for slow move, obsolete or excess Inventory; or
(c) a reserve for favorable standard cost variances; or
(d) a reserve for amounts owing to landlords or warehousemen for
Inventory stored at leased facilities or public warehouses which are not the
subject of an access agreement acceptable to the Administrative Agent, in the
amount of (i) to the extent the Borrowers are able to determine the average
rental expense for any such facility, the Rent Reserve, plus (ii) in all other
events, the Inventory Value of the Inventory stored at such other leased
facilities or public warehouses; or
(e) a reserve for Inventory located at contractors' or vendors'
facilities in the amount of the Inventory Value of such Inventory; or
(f) any other reserve as deemed appropriate by the Administrative
Agent in its exclusive discretion, from time to time; or
(g) a reserve for vendor rebates.
"Inventory Value" shall mean with respect to any Inventory of the
Borrowers at the time of any determination thereof, the standard cost carried on
the perpetual records of the Borrowers stated on a basis consistent with their
current and historical accounting practices, in Dollars, determined in
accordance with the standard cost method of accounting less, (i) any markup on
Inventory from an Affiliate and (ii) in the event variances under the standard
cost method (a) are capitalized, favorable variances shall be deducted from
Eligible Inventory, and unfavorable variances shall not be added to Eligible
Inventory, or (b) are expensed, a reserve shall be determined as appropriate in
order to adjust the standard cost of Eligible Inventory to approximate actual
cost.
"Investments" shall have the meaning given such term in Section 6.10.
16
"Investment Grade" shall mean either (i) at least Baa3 by Moody's (or
the then equivalent) or (ii) at least BBB- by S&P (or the then equivalent).
"JPMCB" shall have the meaning set forth in the Introduction.
"Landlord Lien Waiver" shall mean a written agreement in such form as
is reasonably acceptable to the Administrative Agent, pursuant to which a Person
shall waive or subordinate its rights and claims as landlord in any Inventory of
the Borrowers for unpaid rents, grant access to the Administrative Agent for the
repossession and sale of such inventory and make other agreements relative
thereto.
"Lenders" shall have the meaning set forth in the Introduction.
"Lender Affiliate" shall mean, (i) with respect to any Lender, (a) an
Affiliate of such Lender or (b) any entity (whether a corporation, partnership,
trust or otherwise) that is engaged in making, purchasing, holding or otherwise
investing in loans and similar extensions of credit in the ordinary course of
its business and is administered or managed by a Lender or an Affiliate of such
Lender and (ii) with respect to any Lender that is a fund which invests in loans
and similar extensions of credit, any other fund that invests in loans and
similar extensions of credit and is managed by the same investment advisor as
such Lender or by an Affiliate of such investment advisor.
"Letter of Credit" shall mean any irrevocable letter of credit issued
pursuant to Section 2.3, which letter of credit shall be (i) a standby or import
documentary letter of credit, (ii) issued for purposes that are consistent with
the ordinary course of business of the Borrowers or for such other purposes as
are acceptable to the Administrative Agent, (iii) denominated in Dollars and
(iv) otherwise in such form as may be approved from time to time by the
Administrative Agent and the applicable Fronting Bank.
"Letter of Credit Account" shall mean the account established by the
Borrowers under the sole and exclusive control of the Administrative Agent
maintained at the office of the Administrative Agent at 000 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 designated as the "Interstate Bakeries Corporation Letter
of Credit Account" that shall be used solely for the purposes set forth in
Sections 2.3(a) and 2.13.
"Letter of Credit Fees" shall mean the fees payable in respect of
Letters of Credit pursuant to Section 2.21.
"Letter of Credit Outstandings" shall mean, at any time, the sum of
(i) the aggregate undrawn stated amount of all Letters of Credit then
outstanding plus (ii) all amounts theretofore disbursed under Letters of Credit
and not then reimbursed.
"Lien" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind whatsoever (including any conditional
sale or other title retention agreement or any lease in the nature thereof).
"Loan" and "Loans" shall have the respective meanings given such terms
in Section 2.1.
17
"Loan Documents" shall mean this Agreement, the Letters of Credit, the
Security and Pledge Agreement and any other instrument or agreement executed and
delivered in connection herewith.
"Material Adverse Effect" shall mean (i) a material adverse effect
upon the business, operations, properties, assets, condition (financial or
otherwise) or prospects (other than, with respect to prospects, as may normally
result as a consequence of the commencement of the Cases) of the Borrowers,
taken as a whole, (ii) the material impairment of the ability of the Borrowers
to perform the Obligations and (iii) a material adverse effect upon the
legality, validity, binding effect or enforceability against the Parent Borrower
or any Subsidiary Borrower of a Loan Document to which it is a party.
"Maturity Date" shall mean February 9, 2008.
"Minority Interests" shall mean any shares of stock of any class of a
Subsidiary of the Borrowers (other than directors' qualifying shares if required
by law) that are not owned by Borrowers or one of their Subsidiaries; Minority
Interest shall be valued in accordance with GAAP.
"Minority Lenders" shall have the meaning given such term in Section
9.10(b).
"Moody's" shall mean Xxxxx'x Investors Service, Inc. or any successor
to the rating agency business thereof.
"Multiemployer Plan" shall mean a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA to which any Borrower or any ERISA Affiliate is
making or accruing an obligation to make contributions, or has within any of the
preceding five plan years made or accrued an obligation to make contributions.
"Multiple Employer Plan" shall mean a Single Employer Plan, which (i)
is maintained for employees of a Borrower or an ERISA Affiliate and at least one
Person other than such Borrower and its ERISA Affiliates or (ii) was so
maintained and in respect of which a Borrower or an ERISA Affiliate could have
liability under Section 4064 or 4069 of ERISA in the event such Plan has been or
were to be terminated.
"Net Proceeds" shall mean, in respect of any sale of assets, the
proceeds of such sale after the payment of or reservation for expenses that are
directly related to the sale, including, but not limited to, related severance
costs, taxes payable, brokerage commissions, professional expenses, other
similar costs that are directly related to the sale and the amount secured by
valid and perfected Liens, if any, that are senior to the Liens on such assets
held by the Administrative Agent on behalf of the Lenders.
"Net Total Usage" shall have the meaning set forth in Section 6.5.
"Obligations" shall mean (i) the due and punctual payment of principal
of and interest on the Loans and the reimbursement of all amounts drawn under
Letters of Credit, and (ii) the due and punctual payment of the Fees and all
other present and future, fixed or
18
contingent, monetary obligations of the Borrowers to the Lenders, the
Administrative Agent and the Collateral Agent under the Loan Documents.
"Orders" shall mean, collectively, the Interim Order, Amendment Order
and the Final Order.
"Organizational Documents" shall mean (i) with respect to any
corporation, its certificate or articles of incorporation, as amended, and its
by-laws, as amended, (ii) with respect to any limited partnership, its
certificate of limited partnership or formation, as amended, and its partnership
agreement, as amended, (iii) with respect to any general partnership, its
partnership agreement, as amended, (iv) with respect to any limited liability
company, its certificate of formation or articles of organization, as amended,
and its operating agreement, as amended, and (v) with respect to any unlimited
liability company, its certificate of formation, as amended, and its memorandum
and articles of association, as amended. In the event any term or condition of
this Agreement or any other Loan Document requires any Organizational Document
to be certified by a secretary of state of similar governmental official, the
reference to any such "Organizational Document" shall only be to a document of a
type customarily certified by such governmental official.
"Other Taxes" shall have the meaning given such term in Section
2.18(b).
"Parent Borrower" shall have the meaning set forth in the
Introduction.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or any
successor agency or entity performing substantially the same functions.
"Pension Plan" shall mean a defined benefit pension (as defined in
Section 414(j) of the Code and Section 3(35) of ERISA) which meets and is
subject to the requirements of Section 401(a) of the Code.
"Permitted Investments" shall mean (i) direct obligations of, or
obligations the principal of and interest on which are unconditionally
guaranteed by, the United States of America (or by any agency thereof to the
extent such obligations are backed by the full faith and credit of the United
States of America), in each case maturing within twelve months from the date of
acquisition thereof, (ii) without limiting the provisions of paragraph (iv)
below, investments in commercial paper maturing within six months from the date
of acquisition thereof and having, at such date of acquisition, a rating of at
least "A-2" or the equivalent thereof from S&P or of at least "P-2" or the
equivalent thereof from Moody's, (iii) investments in certificates of deposit,
banker's acceptances and time deposits (including Eurodollar time deposits)
maturing within six months from the date of acquisition thereof issued or
guaranteed by or placed with (a) any domestic office of the Administrative Agent
or the bank with whom the Borrowers maintain their cash management system,
provided, that if such bank is not a Lender hereunder, such bank shall have
entered into an agreement with the Administrative Agent pursuant to which such
bank shall have waived all rights of setoff and confirmed that such bank does
not have, nor shall it claim, a security interest therein or (b) any domestic
office of any other commercial bank of recognized standing organized under the
laws of the United States of America or any State thereof that has a combined
capital and surplus and undivided profits of not less than
19
$250,000,000 and is the principal banking Subsidiary of a bank holding company
having a long-term unsecured debt rating of at least "A" or the equivalent
thereof from S&P or at least "A2" or the equivalent thereof from Moody's, (iv)
investments in commercial paper maturing within six months from the date of
acquisition thereof and issued by (a) the holding company of the Administrative
Agent or (b) the holding company of any other commercial bank of recognized
standing organized under the laws of the United States of America or any State
thereof that has (1) a combined capital and surplus in excess of $250,000,000
and (2) commercial paper rated at least "A-2" or the equivalent thereof from S&P
or of at least "P-2" or the equivalent thereof from Moody's, (v) investments in
repurchase obligations with a term of not more than seven (7) days for
underlying securities of the types described in clause (i) above entered into
with any office of a bank or trust company meeting the qualifications specified
in clause (iii) above, (vi) investments in money market funds substantially all
the assets of which are comprised of securities of the types described in
clauses (i) through (v) above, (vii) to the extent owned by the Borrowers on the
Filing Date, investments in the capital stock of any direct or indirect
Subsidiary of the Borrowers as disclosed in Schedule 3.5, and (viii) to the
extent owned by the Borrowers on the Filing Date, miscellaneous investments in
the capital stock of any Person held by any individual bakery, in full or
partial payment for certain services rendered or products supplied, in an
aggregate amount not to exceed $1,000,000.
"Permitted Liens" shall mean (i) Liens in favor of the Administrative
Agent on behalf of the Lenders; (ii) Liens imposed by law (other than
Environmental Liens and any Lien imposed under ERISA) for taxes, assessments or
charges of any Governmental Authority for claims not yet due or which are being
contested in good faith by appropriate proceedings and with respect to which
adequate reserves or other appropriate provisions are being maintained in
accordance with GAAP; (iii) Liens of landlords and Liens of statutory carriers,
warehousemen, mechanics, materialmen and other Liens (other than Environmental
Liens and any Lien imposed under ERISA) in existence on the Filing Date or
thereafter imposed by law and created in the ordinary course of business; (iv)
Liens (other than any Lien imposed under ERISA) incurred or deposits made
(including, without limitation, surety bonds and appeal bonds) in connection
with workers' compensation, unemployment insurance and other types of social
security benefits or to secure the performance of tenders, bids, leases,
contracts (other than for the repayment of Indebtedness), statutory obligations
and other similar obligations incurred in the ordinary course of business; (v)
easements (including, without limitation, reciprocal easement agreements and
utility agreements), rights-of-way, covenants, consents, reservations,
encroachments, variations and zoning and other restrictions, charges or
encumbrances (whether or not recorded) and interest of ground lessors, which do
not materially interfere with the ordinary conduct of the business of any
Borrower, and which do not materially detract from the value of the property to
which they attach or materially impair the use thereof to any Borrower; (vi)
purchase money Liens (including Capitalized Leases) upon or in any property
acquired or held in the ordinary course of business to secure the purchase price
of such property or to secure Indebtedness permitted by Section 6.3(iii) solely
for the purpose of financing the acquisition of such property; (vii) Liens set
forth on Schedule 3.6; (viii) Liens on the assets of Subsidiaries granted to
secure Indebtedness permitted by Section 6.3(vii); (ix) Liens created in
connection with extensions, renewals or replacements, including replacement
Liens granted by the Bankruptcy Court, of any Lien referred to in clauses (i)
through (vii) above, provided that the principal amount of the obligation
secured thereby is not increased and that any such extension, renewal or
replacement is limited to the property originally encumbered thereby; (x)
pre-petition Liens granted pursuant
20
to the Pre-Petition Credit Agreement or the Security Documents (as defined
therein) by the Borrowers party to the Pre-Petition Credit Agreement for the
benefit of the banks and other financial institutions from time to time party to
the Pre-Petition Credit Agreement; and (xi) Liens junior to the senior liens
contemplated hereby that are granted by any of the Orders pursuant to 11 U.S.C.
ss.364(d)(1) as adequate protection to the Primed Parties, provided that the
Orders provide that the holders of such junior liens shall not be permitted to
take any action to enforce their rights with respect to such junior liens as
long as any amounts are outstanding under this Agreement or the Lenders have any
Commitment hereunder.
"Person" shall mean any natural person, corporation, division of a
corporation, partnership, trust, joint venture, association, company, estate,
unincorporated organization or government or any agency or political subdivision
thereof.
"Plan" shall mean a Single Employer Plan or a Multiemployer Plan.
"Pre-Petition Credit Agreement" shall mean that certain Amended and
Restated Credit Agreement dated as of April 25, 2002, as amended, supplemented
or otherwise modified prior to the Filing Date, among the Parent Borrower and
certain of the Subsidiary Borrowers, as borrowers, the banks and other financial
institutions from time to time parties thereto, JPMCB, as administrative agent,
and others.
"Pre-Petition Payment" shall mean a payment (by way of adequate
protection or otherwise) of principal or interest or otherwise on account of any
pre-petition Indebtedness or trade payables or other pre-petition claims against
the Borrowers, including, without limitation, reclamation claims and
materialmen's liens.
"Prepayment Date" shall mean thirty-five (35) days after the entry of
the Interim Order by the Bankruptcy Court if the Final Order has not been
entered by the Bankruptcy Court prior to the expiration of such thirty-five (35)
day period.
"Primed Liens" shall have the meaning set forth in Section 2.23.
"Primed Parties" shall mean the parties who hold Primed Liens.
"Pure Food and Drug Laws" shall mean (i) the Federal Food, Drug and
Cosmetic Act, as amended from time to time, and any successor statute and (ii)
the pure food and drug laws of each of the states of the United States into
which products manufactured, marketed or sold by the Borrowers are or have been
shipped.
"Raw Materials" shall mean any items or materials used or consumed in
the manufacture of goods to be sold by the Borrowers in the ordinary course of
business.
"Real Property Component" shall mean a component of the Borrowing Base
determined with reference to the Eligible Real Property and shall mean, at the
time of any determination, an amount equal to the lesser of (i) $80,000,000 (as
adjusted from time to time pursuant to Section 5.8) or (ii) 40% of the Borrowing
Base inclusive of the Real Property Component.
21
"Register" shall have the meaning set forth in Section 9.3(e).
"Release" shall mean actively or passively disposing, discharging,
injecting, spilling, pumping, leaking, leaching, dumping, emitting, escaping,
emptying, pouring, seeping, migrating or the like, into or upon any land or
water or air, or otherwise entering into the environment.
"Rent Reserve" shall mean, with respect to any store, warehouse
distribution center, regional distribution center or depot where any Inventory
subject to Liens arising by operation of law is located, a reserve equal to
three (3) months' rent at such store, warehouse distribution center, regional
distribution center or depot.
"Reorganization Plan" shall mean a plan of reorganization in any of
the Cases.
"Replacement Lender" shall have the meaning given such term in Section
2.29.
"Required Lenders" shall mean, at any time, Lenders holding in excess
of 50% of the Total Commitment.
"S&P" shall mean Standard & Poor's Rating Services, a division of The
XxXxxx-Xxxx Companies, Inc., or any successor to the rating agency business
thereof.
"Security and Pledge Agreement" shall have the meaning given such
term in Section 4.1(c).
"Single Employer Plan" shall mean a single employer plan, as defined
in Section 4001(a)(15) of ERISA, that (i) is maintained for employees of a
Borrower or an ERISA Affiliate or (ii) was so maintained and in respect of which
a Borrower could have liability under Section 4069 of ERISA in the event such
Plan has been or were to be terminated.
"Statutory Reserves" shall mean on any date the percentage (expressed
as a decimal) established by the Board and any other banking authority which is
(i) for purposes of the definition of Base CD Rate, the then stated maximum rate
of all reserves (including, but not limited to, any emergency, supplemental or
other marginal reserve requirement) for a member bank of the Federal Reserve
System in New York City, for new three month negotiable nonpersonal time
deposits in dollars of $100,000 or more or (ii) for purposes of the definition
of Adjusted LIBOR Rate, the then stated maximum rate for all reserves (including
but not limited to any emergency, supplemental or other marginal reserve
requirements) applicable to any member bank of the Federal Reserve System in
respect of Eurocurrency Liabilities (or any successor category of liabilities
under Regulation D issued by the Board, as in effect from time to time). Such
reserve percentages shall include, without limitation, those imposed pursuant to
said Regulation. The Statutory Reserves shall be adjusted automatically on and
as of the effective date of any change in such percentage.
"Subsidiary" shall mean, with respect to any Person (herein referred
to as the "parent"), any corporation, association or other business entity
(whether now existing or hereafter organized) of which at least a majority of
the securities or other ownership interests having ordinary voting power for the
election of directors is, at the time as of which any
22
determination is being made, owned or controlled by the parent or one or more
subsidiaries of the parent or by the parent and one or more subsidiaries of the
parent.
"Subsidiary Borrower" and "Subsidiary Borrowers" shall have the
respective meanings set forth in the Introduction.
"Super-majority Lenders" shall have the meaning given such term in
Section 9.10(b).
"Superpriority Claim" shall mean a claim against any Borrower in any
of the Cases which is a superpriority administrative expense claim having
priority over any or all administrative expenses of the kind specified in
Sections 503(b) or 507(b) of the Bankruptcy Code.
"Suspension Period" shall have the meaning set forth in Section 6.5.
"Taxes" shall have the meaning given such term in Section 2.18.
"Termination Date" shall mean the earliest to occur of (i) the
Prepayment Date, (ii) the Maturity Date, (iii) the Consummation Date and (iv)
the acceleration of the Loans and the termination of the Total Commitment in
accordance with the terms hereof.
"Termination Event" shall mean (i) a "reportable event", as such term
is described in Section 4043 of ERISA and the regulations issued thereunder
(other than a "reportable event" not subject to the provision for 30-day notice
to the PBGC under Section 4043 of ERISA or such regulations) or an event
described in Section 4068 of ERISA excluding events described in Section
4043(c)(9) of ERISA or 29 CFR xx.xx. 2615.21 or 2615.23, or (ii) the withdrawal
of any Borrower or any ERISA Affiliate from a Multiple Employer Plan during a
plan year in which it was a "substantial employer", as such term is defined in
Section 4001(c) of ERISA, or the incurrence of liability by any Borrower or any
ERISA Affiliate under Section 4064 of ERISA upon the termination of a Multiple
Employer Plan, or (iii) providing notice of intent to terminate a Plan pursuant
to Section 4041(c) of ERISA or the treatment of a Plan amendment as a
termination under Section 4041 of ERISA, or (iv) the institution of proceedings
to terminate a Plan by the PBGC under Section 4042 of ERISA, or (v) any other
event or condition (other than the commencement of the Cases and the failure to
have made any contribution accrued as of the Filing Date but not paid) which
would reasonably be expected to constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any Plan,
or the imposition of any liability under Title IV of ERISA (other than for the
payment of premiums to the PBGC).
"Total Commitment" shall mean, at any time, the sum of the Commitments
at such time.
"Total Usage" shall mean, at any time, the sum of the outstanding
aggregate principal amount of the Loans plus the aggregate Letter of Credit
Outstandings.
"Transferee" shall have the meaning given such term in Section 2.18.
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"Type" when used in respect of any Loan or Borrowing shall refer to
the Rate of interest by reference to which interest on such Loan or on the Loans
comprising such Borrowing is determined. For purposes hereof, "Rate" shall mean
the Adjusted LIBOR Rate and the Alternate Base Rate.
"Unfunded Current Liability" shall mean, with respect to any Pension
Plan, the amount, if any, by which the actuarial present value of the
accumulated plan benefits under such Pension Plan as of the close of its most
recent plan year exceeds the fair market value of the assets allocable thereto,
each determined in accordance with Statement of Financial Accounting Standards
No. 35, based upon the actuarial assumptions used by such Pension Plan's actuary
in the most recent annual valuation of such Pension Plan.
"Unused Total Commitment" shall mean, at any time, (i) the Total
Commitment less (ii) the sum of (a) the aggregate outstanding principal amount
of all Loans and (b) the aggregate Letter of Credit Outstandings.
"Withdrawal Liability" shall have the meaning given such term under
Part I of Subtitle E of Title IV of ERISA.
"Work-in-Process" shall mean Inventory which consists of
work-in-process including, without limitation, materials other than Raw
Materials, Finished Goods or saleable products, title to which and sole
ownership of which is vested in a Borrower.
SECTION 1.2 Terms Generally. The definitions in Section 1.1 shall apply
equally to both the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. All references herein to Sections,
Exhibits and Schedules shall be deemed references to Sections of, and Exhibits
and Schedules to, this Agreement unless the context shall otherwise require.
Except as otherwise expressly provided herein, all terms of an accounting or
financial nature shall be construed in accordance with GAAP, as in effect from
time to time; provided, however, that for purposes of determining compliance
with any covenant set forth in Section 6, such terms shall be construed in
accordance with GAAP as in effect on the date of this Agreement applied on a
basis consistent with the application used in the Borrowers' audited financial
statements referred to in Section 3.4.
SECTION 1.3 Accounting Terms; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrowers notify the Administrative Agent that the Borrowers
request an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof
on the operation of such provision (or if the Administrative Agent notifies
the Borrowers that the Required Lenders request an amendment to any provision
hereof for such purpose), regardless of whether any such notice is given
before or after such change in GAAP or in the application thereof, then such
provision shall be interpreted on the basis of GAAP as in effect and applied
immediately before such change shall have become effective until such notice
shall have been withdrawn or such provision amended in accordance herewith.
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SECTION 2. AMOUNT AND TERMS OF CREDIT.
SECTION 2.1 Commitment of the Lenders.
(a) Each Lender severally and not jointly with the other Lenders
agrees, upon the terms and subject to the conditions herein set forth, to make
revolving credit loans (each a "Loan" and collectively, the "Loans") to the
Borrowers at any time and from time to time during the period commencing on the
date hereof and ending on the Termination Date (or the earlier date of
termination of the Total Commitment) in an aggregate principal amount not to
exceed, when added to such Lender's Commitment Percentage of the then aggregate
Letter of Credit Outstandings, the Commitment of such Lender, which Loans may be
repaid and reborrowed in accordance with the provisions of this Agreement.
(b) Each Borrowing shall be made by the Lenders pro rata in accordance
with their respective Commitments; provided, however, that the failure of any
Lender to make any Loan shall not in itself relieve the other Lenders of their
obligations to lend.
SECTION 2.2 Availability of Commitment; Borrowing Base.
(a) Subject to the terms, conditions and covenants hereof, during the
period commencing on the Filing Date and ending on the date the Bankruptcy Court
enters the Final Order (such period being referred to as the "Interim Period"),
$50,000,000 of the Total Commitment (the "Interim Commitment") shall be
available to the Borrowers without regard to the Borrowing Base, (but otherwise
subject to the terms, conditions and covenants described in this Agreement).
(b) Upon the expiration of the Interim Period, the Borrowing Base
shall become operative with respect to the availability of Loans and Letters of
Credit under the Commitment, and $150,000,000 of the Total Commitment (the
"Available Commitment") shall be available to the Borrowers (subject to
compliance with the Borrowing Base and the terms, conditions and covenants
described in this Agreement).
(c) On the first Business Day after (i) the expiration of the Interim
Period and (ii) the Borrowers shall have delivered and both the Administrative
Agent and Xxxxxxxx Xxxxxx & Company or such other financial advisor as may be
acceptable to the Administrative Agent shall have accepted the Budget in
accordance with Section 5.1(g) hereof (such Business Day being referred to as
the "Budget Acceptance Date"), the Total Commitment shall be available to the
Borrowers (subject to compliance with the Borrowing Base and the terms,
conditions and covenants in this Agreement).
(d) Notwithstanding any other provision of this Agreement to the
contrary, Total Usage shall not at any time exceed (i) prior to the expiration
of the Interim Period, the Interim Commitment, (ii) from and after the
expiration of the Interim Period but prior to the Budget Acceptance Date, the
lesser of (x) the Available Commitment and (y) the Borrowing Base, and (iii)
from and after the Budget Acceptance Date, the lesser of (x) the Total
Commitment (as such Total Commitment may be reduced from time to time pursuant
to the terms of this Agreement) and (y) the Borrowing Base, and no Loan shall be
made or Letter of Credit issued in violation of the foregoing.
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SECTION 2.3 Letters of Credit.
(a) Upon the terms and subject to the conditions herein set forth, the
Borrowers may request a Fronting Bank, at any time and from time to time after
the date hereof and prior to the Termination Date, to issue, and, subject to the
terms and conditions contained herein, such Fronting Bank shall issue, for the
account of the Borrowers one or more Letters of Credit in support of obligations
of the Borrowers or one or more of the Subsidiaries, provided that no Letter of
Credit shall be issued if after giving effect to such issuance (i) the aggregate
Letter of Credit Outstandings would exceed $150,000,000, or (ii) the Total Usage
would exceed (x) prior to the expiration of the Interim Period, the Interim
Commitment, (y) from and after the expiration of the Interim Period but prior to
the Budget Acceptance Date, the lesser of (aa) the Available Commitment and (bb)
the Borrowing Base, and (z) from and after the Budget Acceptance Date, the
lesser of (cc) the Total Commitment and (dd) the Borrowing Base.
(b) No Letter of Credit shall expire later than three hundred
sixty-five (365) days after the Maturity Date, provided that if the Termination
Date shall occur prior to the expiration of any Letter of Credit, the Borrowers
shall, at or prior to the Termination Date, except as the Administrative Agent
may otherwise agree in writing, (i) cause all Letters of Credit which expire
after the Termination Date to be returned to the Fronting Bank undrawn and
marked "canceled" or (ii) if the Borrowers are unable to do so in whole or in
part, either (x) provide a "back-to-back" letter of credit to one or more
Fronting Banks in a form satisfactory to such Fronting Bank and the
Administrative Agent (in their exclusive discretion), issued by a bank
satisfactory to such Fronting Bank and the Administrative Agent (in their
exclusive discretion), in an amount equal to the greater of (A) an amount, as
determined by the Fronting Bank and the Administrative Agent, equal to the face
amount of all outstanding Letters of Credit plus the sum of all projected
contractual obligations to the Administrative Agent, the Fronting Bank and the
Lenders of the Borrowers thereunder through the expiration date(s) of such
Letters of Credit, and (B) 105% of the then undrawn stated amount of all
outstanding Letters of Credit issued by such Fronting Banks and/or (y) deposit
cash in the Letter of Credit Account in an amount which, together with any
amounts then held in the Letter of Credit Account, is equal to the greater of
(A) an amount, as determined by the Fronting Bank and the Administrative Agent,
equal to the face amount of all outstanding Letters of Credit plus the sum of
all projected contractual obligations to the Administrative Agent, the Fronting
Bank and the Lenders of the Borrowers thereunder through the expiration date(s)
of such Letters of Credit, and (B) 105% of the then undrawn stated amount of all
Letter of Credit Outstandings as collateral security for the Borrowers'
reimbursement obligations in connection therewith, such cash to be promptly
remitted to the Borrowers upon the expiration, cancellation or other termination
or satisfaction of such reimbursement obligations.
(c) The Borrowers shall pay to each Fronting Bank, in addition to such
other fees and charges as are specifically provided for in Section 2.21 hereof,
such fees and charges in connection with the issuance and processing of the
Letters of Credit issued by such Fronting Bank as are customarily imposed by
such Fronting Bank from time to time in connection with letter of credit
transactions.
(d) Drafts drawn under each Letter of Credit shall be reimbursed by
the Borrowers in Dollars not later than the first Business Day following the
date of draw and shall
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bear interest from the date of draw until the first Business Day following the
date of draw at a rate per annum equal to the Alternate Base Rate plus 1.75% and
thereafter until reimbursed in full at a rate per annum equal to the Alternate
Base Rate plus 3.75% (computed on the basis of the actual number of days elapsed
over a year of 360 days). The Borrowers shall effect such reimbursement (x) if
such draw occurs prior to the Termination Date (or the earlier date of
termination of the Total Commitment), in cash or through a Borrowing of Loans
without the satisfaction of the conditions precedent set forth in Section 4.2 or
(y) if such draw occurs on or after the Termination Date (or the earlier date of
termination of the Total Commitment), in cash. Each Lender agrees to make the
Loans described in clause (x) of the preceding sentence notwithstanding a
failure to satisfy the applicable lending conditions thereto or the provisions
of Section 2.29.
(e) Immediately upon the issuance of any Letter of Credit by any
Fronting Bank, such Fronting Bank shall be deemed to have sold to each Lender
other than such Fronting Bank and each such other Lender shall be deemed
unconditionally and irrevocably to have purchased from such Fronting Bank,
without recourse or warranty, an undivided interest and participation, to the
extent of such Lender's Commitment Percentage, in such Letter of Credit, each
drawing thereunder and the obligations of the Borrowers under this Agreement
with respect thereto. Upon any change in the Commitments pursuant to Section
9.3, it is hereby agreed that with respect to all Letter of Credit Outstandings,
there shall be an automatic adjustment to the participations hereby created to
reflect the new Commitment Percentages of the assigning and assignee Lenders.
Any action taken or omitted by a Fronting Bank under or in connection with a
Letter of Credit, if taken or omitted in the absence of gross negligence or
willful misconduct, shall not create for such Fronting Bank any resulting
liability to any other Lender.
(f) In the event that a Fronting Bank makes any payment under any
Letter of Credit and the Borrowers shall not have reimbursed such amount in full
to such Fronting Bank pursuant to this Section, the Fronting Bank shall promptly
notify the Administrative Agent, which shall promptly notify each Lender of such
failure, and each Lender shall promptly and unconditionally pay to the
Administrative Agent for the account of the Fronting Bank the amount of such
Lender's Commitment Percentage of such unreimbursed payment in Dollars and in
same day funds. If the Fronting Bank so notifies the Administrative Agent, and
the Administrative Agent so notifies the Lenders prior to 12:00 p.m. (New York
City time) on any Business Day, such Lenders shall make available to the
Fronting Bank such Lender's Commitment Percentage of the amount of such payment
on such Business Day in same day funds. If and to the extent such Lender shall
not have so made its Commitment Percentage of the amount of such payment
available to the Fronting Bank, such Lender agrees to pay to such Fronting Bank,
forthwith on demand such amount, together with interest thereon, for each day
from such date until the date such amount is paid to the Administrative Agent
for the account of such Fronting Bank at the Federal Funds Effective Rate. The
failure of any Lender to make available to the Fronting Bank its Commitment
Percentage of any payment under any Letter of Credit shall not relieve any other
Lender of its obligation hereunder to make available to the Fronting Bank its
Commitment Percentage of any payment under any Letter of Credit on the date
required, as specified above, but no Lender shall be responsible for the failure
of any other Lender to make available to such Fronting Bank such other Lender's
Commitment Percentage of any such payment. Whenever a Fronting Bank receives a
payment of a reimbursement obligation as to which it has received any payments
from the Lenders pursuant to this paragraph, such Fronting Bank shall pay to
each
27
Lender which has paid its Commitment Percentage thereof, in Dollars and in same
day funds, an amount equal to such Lender's Commitment Percentage thereof.
(g) Unless otherwise requested by the Administrative Agent, each
Fronting Bank shall report in writing to the Administrative Agent (i) on the
first Business Day of each week, the daily activity (set forth by day) in
respect of Letters of Credit during the immediately preceding week, including
all issuances, extensions, amendments and renewals, all expirations and
cancellations and all disbursements and reimbursements, (ii) on or prior to each
Business Day on which such Fronting Bank expects to issue, amend, renew or
extend any Letter of Credit, the date of such issuance, amendment, renewal or
extension and the aggregate face amount of the Letters of Credit to be issued,
amended, renewed or extended by it and outstanding after giving effect to such
issuance, amendment, renewal or extension (and whether the amount thereof
changed), it being understood that such Fronting Bank shall not permit any
issuance, renewal, extension or amendment resulting in an increase in the amount
of a Letter of Credit to occur without first obtaining written confirmation from
the Administrative Agent that it is then permitted under this Agreement, (iii)
on each Business Day on which such Fronting Bank makes any payment under any
Letter of Credit, the date of such payment and the amount of such payment, (iv)
on any Business Day on which a Borrower fails to reimburse a payment under a
Letter of Credit required to be reimbursed to such Fronting Bank on such day,
the date of such failure, the applicable Borrower and the amount and currency of
such Letter of Credit payment and (v) on any other Business Day, such other
information as the Administrative Agent shall reasonably request.
SECTION 2.4 Issuance. Whenever the Parent Borrower or a Subsidiary
Borrower desire a Fronting Bank to issue a Letter of Credit, they shall give
to such Fronting Bank and the Administrative Agent at least three (3) Business
Days' prior written (including facsimile communication) notice (or such
shorter period as may be agreed upon by the Administrative Agent, the
Borrowers and the Fronting Bank) specifying the date on which the proposed
Letter of Credit is to be issued (which shall be a Business Day), the stated
amount of the Letter of Credit so requested, the expiration date of such
Letter of Credit and the name and address of the beneficiary thereof.
SECTION 2.5 Nature of Letter of Credit Obligations Absolute. The
obligations of the Borrowers to reimburse the Lenders for drawings made under
any Letter of Credit shall be joint and several, unconditional and irrevocable
and shall be paid strictly in accordance with the terms of this Agreement
under all circumstances, including, without limitation: (i) any lack of
validity or enforceability of any Letter of Credit; (ii) the existence of any
claim, setoff, defense or other right which any Borrower may have at any time
against a beneficiary of any Letter of Credit or against any of the Lenders,
whether in connection with this Agreement, the transactions contemplated
herein or any unrelated transaction; (iii) any draft, demand, certificate or
other document presented under any Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect; (iv) payment by a Fronting Bank of
any Letter of Credit against presentation of a demand, draft or certificate or
other document which does not comply with the terms of such Letter of Credit;
(v) any other circumstance or happening whatsoever, which is similar to any of
the foregoing; or (vi) the fact that any Event of Default shall have occurred
and be continuing.
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SECTION 2.6 Making of Loans.
(a) Except as contemplated by Section 2.11, Loans shall be either ABR
Loans or Eurodollar Loans as the Borrowers may request subject to and in
accordance with this Section, provided that all Loans made pursuant to the same
Borrowing shall, unless otherwise specifically provided herein, be Loans of the
same Type. Each Lender may fulfill its Commitment with respect to any Eurodollar
Loan or ABR Loan by causing any lending office of such Lender to make such Loan;
provided that any such use of a lending office shall not affect the obligation
of the Borrowers to repay such Loan in accordance with the terms of this
Agreement. Each Lender shall, subject to its overall policy considerations, use
reasonable efforts (but shall not be obligated) to select a lending office which
will not result in the payment of increased costs by the Borrowers pursuant to
Sections 2.15 or 2.18. Subject to the other provisions of this Section and the
provisions of Section 2.12, Borrowings of Loans of more than one Type may be
incurred at the same time, provided that no more than twelve (12) Borrowings of
Eurodollar Loans may be outstanding at any time.
(b) The applicable Borrower shall give the Administrative Agent prior
written, facsimile or telephonic (confirmed promptly in writing) notice of each
Borrowing of Loans hereunder of at least three (3) Business Days for Eurodollar
Loans and one (1) Business Day for ABR Loans (subject, in the case of ABR Loans,
to the last sentence of this Section); such notice shall be irrevocable and
shall specify the amount of the proposed Borrowing (which shall not be less than
$5,000,000 for Eurodollar Loans and $1,000,000 for ABR Loans, or any integral
multiple of $1,000,000 in excess of such minimum amounts) and the date thereof
(which shall be a Business Day) and shall contain disbursement instructions.
Such notice, to be effective, must be received by the Administrative Agent not
later than 12:00 p.m., New York City time, on the third Business Day in the case
of Eurodollar Loans and the first Business Day in the case of ABR Loans,
preceding the date on which such Borrowing is to be made except as provided in
the last sentence of this Section 2.06(b). Such notice shall specify whether the
Borrowing then being requested is to be a Borrowing of ABR Loans or Eurodollar
Loans. If no election is made as to the Type of Loan, such notice shall be
deemed a request for Borrowing of ABR Loans. The Administrative Agent shall
promptly notify each Lender of its proportionate share of such Borrowing, the
date of such Borrowing, the Type of Borrowing or Loans being requested and the
Interest Period or Interest Periods applicable thereto, as appropriate. On the
Borrowing date specified in such notice, each Lender shall make its share of the
Borrowing available at the office of the Administrative Agent at 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, no later than 12:00 p.m., New York City time,
in immediately available funds. Upon receipt of the funds made available by the
Lenders to fund any Borrowing hereunder, the Administrative Agent shall disburse
such funds in the manner specified in the notice of Borrowing delivered by the
Borrowers. With respect to ABR Loans in an aggregate amount of up to $3,000,000,
the Lenders shall make such Borrowings available to the Administrative Agent no
later than 12:00 p.m., New York City time, in immediately available funds, and
the Administrative Agent shall disburse such Borrowings in accordance with the
applicable Borrower's instructions consistent with this Agreement by 3:00 p.m.,
New York City time, on the same Business Day that such Borrower gives notice to
the Administrative Agent of such Borrowing by 10:00 a.m., New York City time.
SECTION 2.7 Repayment of Loans and Unreimbursed Draws; Evidence of Debt.
29
(a) The Borrowers hereby jointly and severally unconditionally promise
to pay to the Administrative Agent for the account of each Lender the then
unpaid principal amount of each Loan and each unreimbursed draw under all
Letters of Credit as set forth herein.
(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the Indebtedness of the Parent Borrower and
the Subsidiary Borrowers to such Lender resulting from each Loan made by such
Lender or participation in each Letter of Credit in which such Lender is
participating, including the amounts of principal and interest payable and paid
to such Lender from time to time hereunder.
(c) The Administrative Agent shall maintain accounts in which it shall
record (i) the amount of each Loan made hereunder, the Type thereof and the
Interest Period applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Parent Borrower or the
Subsidiary Borrowers, as the case may be, to each Lender hereunder and (iii) the
amount of any sum received by the Administrative Agent hereunder for the account
of the Lenders and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to paragraph
(b) or (c) of this Section shall be prima facie evidence of the existence and
amounts of the obligations recorded therein; provided that the failure of any
Lender or the Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligation of the Borrowers to repay
the Loans in accordance with the terms of this Agreement.
(e) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrowers shall execute and deliver to such
Lender a promissory note payable to the order of such Lender (or, if requested
by such Lender, to such Lender and its registered assigns) in a form furnished
by the Administrative Agent. Thereafter, the Loans evidenced by such promissory
note and interest thereon shall at all times (including after assignment
pursuant to Section 9.3) be represented by one or more promissory notes in such
form payable to the order of the payee named therein (or, if such promissory
note is a registered note, to such payee and its registered assigns).
SECTION 2.8 Interest on Loans.
(a) Subject to the provisions of Section 2.9, each ABR Loan shall bear
interest (computed, for ABR Loans wherein the Alternate Base Rate is determined
by reference to the Base CD Rate or the Federal Funds Effective Rate, on the
basis of the actual number of days elapsed over a year of 360 days, and
otherwise computed on the basis of the actual number of days elapsed over a year
of 365 days) at a rate per annum equal to the Alternate Base Rate plus 1.75%.
(b) Subject to the provisions of Section 2.9, each Eurodollar Loan
shall bear interest (computed on the basis of the actual number of days elapsed
over a year of 360 days) at a rate per annum equal, during each Interest Period
applicable thereto, to the Adjusted LIBOR Rate for such Interest Period in
effect for such Borrowing plus 2.75%.
(c) Accrued interest on all Loans shall be payable in arrears on each
Interest Payment Date applicable thereto, at maturity (whether by acceleration
or otherwise), after such
30
maturity on demand and (with respect to Eurodollar Loans) upon any repayment or
prepayment thereof (on the amount prepaid).
SECTION 2.9 Default Interest. If any Borrower shall default in the
payment of the principal of or interest on any Loan or in the payment of any
other amount becoming due hereunder (including, without limitation, the
reimbursement pursuant to Section 2.3(d) of any draft drawn under a Letter of
Credit), whether at stated maturity, by acceleration or otherwise, such
Borrower shall on demand from time to time pay interest, to the extent
permitted by law, on such defaulted amount up to (but not including) the date
of actual payment (after as well as before judgment) at a rate per annum
(computed on the basis of the actual number of days elapsed over a year of 360
days) equal to 2% above the then applicable rate.
SECTION 2.10 Optional Termination or Reduction of Commitment. Upon at
least three (3) Business Days' prior written notice to the Administrative
Agent, the Borrowers may at any time in whole permanently terminate, or from
time to time in part permanently reduce, the Unused Total Commitment. Each
such reduction or termination, as applicable, of the Unused Total Commitment
shall be in the principal amount of $1,000,000 or any integral multiple of
$1,000,000 in excess thereof. Any reduction or termination, as applicable,
pursuant to this Section shall be deemed to be a reduction or termination, as
applicable, in the amount of such reduction or termination of the Total
Commitment and shall be applied pro rata to reduce the applicable Commitment
of each Lender. Simultaneously with each reduction or termination, as
applicable, of the Unused Total Commitment, the Borrowers shall pay to the
Administrative Agent for the account of each Lender the Commitment Fee accrued
on the amount of the Commitment of such Lender so terminated or reduced
through the date thereof.
SECTION 2.11 Alternate Rate of Interest. In the event, and on each
occasion, that on the day three (3) Business Days prior to the commencement of
any Interest Period for a Eurodollar Loan, the Administrative Agent shall have
determined (which determination shall be conclusive and binding upon the
Borrowers absent manifest error) that reasonable means do not exist for
ascertaining the applicable Adjusted LIBOR Rate, the Administrative Agent
shall, as soon as practicable thereafter, give written notice of such
determination to the Borrowers and the Lenders, and any request by the
Borrowers for a Borrowing of Eurodollar Loans (including pursuant to a
refinancing with Eurodollar Loans) pursuant to Section 2.6 or 2.12 shall be
deemed a request for a Borrowing of ABR Loans. After such notice shall have
been given and until the circumstances giving rise to such notice no longer
exist, each request for a Borrowing of Eurodollar Loans shall be deemed to be
a request for a Borrowing of ABR Loans.
SECTION 2.12 Refinancing of Loans. The Borrowers shall have the right, at
any time, on three (3) Business Days' prior irrevocable notice to the
Administrative Agent (which notice, to be effective, must be received by the
Administrative Agent not later than 1:00 p.m., New York City time, on the
third Business Day preceding the date of any refinancing), (x) to refinance
(without the satisfaction of the conditions set forth in Section 4.2 as a
condition to such refinancing) any outstanding Borrowing or Borrowings of
Loans of one Type (or a portion thereof) with a Borrowing of Loans of the
other Type or (y) to continue an outstanding Borrowing of Eurodollar Loans for
an additional Interest Period, subject to the following:
31
(a) as a condition to the refinancing of ABR Loans with Eurodollar
Loans and to the continuation of Eurodollar Loans for an additional Interest
Period, no Event of Default shall have occurred and be continuing at the time of
such refinancing;
(b) if less than a full Borrowing of Loans shall be refinanced, such
refinancing shall be made pro rata among the Lenders in accordance with the
respective principal amounts of the Loans comprising such Borrowing held by the
Lenders immediately prior to such refinancing;
(c) the aggregate principal amount of Loans being refinanced shall be
at least $5,000,000 or any integral multiple of $1,000,000 in excess thereof,
provided that no partial refinancing of a Borrowing of Eurodollar Loans shall
result in the Eurodollar Loans remaining outstanding pursuant to such Borrowing
being less than $5,000,000 in aggregate principal amount;
(d) each Lender shall effect each refinancing by applying the proceeds
of its new Eurodollar Loan or ABR Loan, as the case may be, to its Loan being
refinanced;
(e) the Interest Period with respect to a Borrowing of Eurodollar
Loans effected by a refinancing or in respect to the Borrowing of Eurodollar
Loans being continued as Eurodollar Loans shall commence on the date of
refinancing or the expiration of the current Interest Period applicable to such
continuing Borrowing, as the case may be;
(f) a Borrowing of Eurodollar Loans may be refinanced only on the last
day of an Interest Period applicable thereto; and
(g) each request for a refinancing with a Borrowing of Eurodollar
Loans which fails to state an applicable Interest Period shall be deemed to be a
request for an Interest Period of one month.
In the event that the Parent Borrower or a Subsidiary Borrower, as applicable,
shall not give notice to refinance any Borrowing of Eurodollar Loans, or to
continue such Borrowing as Eurodollar Loans, or shall not be entitled to
refinance or continue such Borrowing as Eurodollar Loans, in each case as
provided above, such Borrowing shall automatically be refinanced with a
Borrowing of ABR Loans at the expiration of the then-current Interest Period.
The Administrative Agent shall, after it receives notice from the Parent
Borrower or a Subsidiary Borrower, as applicable, promptly give each Lender
notice of any refinancing, in whole or part, of any Loan made by such Lender.
SECTION 2.13 Mandatory Prepayment; Commitment Termination.
(a) If at any time the aggregate principal amount of the outstanding
Loans plus the aggregate Letter of Credit Outstandings exceeds (A) prior to the
expiration of the Interim Period, the Interim Commitment, (B) from and after the
expiration of the Interim Period and prior to the Budget Acceptance Date, the
lesser of (x) the Available Commitment and (y) the Borrowing Base, or (C) from
and after the Budget Acceptance Date, the lesser of (x) the Total Commitment and
(y) the Borrowing Base, the Borrowers will within one (1) Business Day (i)
prepay the Loans in an amount necessary to cause the aggregate principal amount
of the
32
outstanding Loans plus the aggregate Letter of Credit Outstandings, including
unreimbursed draws, to be equal to or less than (A) prior to the expiration of
the Interim Period, the Interim Commitment, (B) from and after the expiration of
the Interim Period and prior to the Budget Acceptance Date, the lesser of (x)
the Available Commitment and (y) the Borrowing Base, and (C) from and after the
Budget Acceptance Date, the lesser of (x) the Total Commitment and (y) the
Borrowing Base and (ii) if, after giving effect to the prepayment in full of the
Loans, the aggregate Letter of Credit Outstandings exceeds (A) prior to the
expiration of the Interim Period, the Available Commitment, (B) from and after
the expiration of the Interim Period and prior to the Budget Acceptance Date,
the lesser of (x) the Available Commitment and (y) the Borrowing Base, (C) from
and after the Budget Acceptance Date, the lesser of (x) the Total Commitment and
(y) the Borrowing Base, deposit into the Letter of Credit Account an amount
equal to 105% of the amount by which the aggregate Letter of Credit Outstandings
(net of the amount of cash held in the Letter of Credit Account) so exceeds (A)
prior to the expiration of the Interim Period, the Interim Commitment, (B) from
and after the expiration of the Interim Period and prior to the Budget
Acceptance Date, the lesser of (x) the Available Commitment and (y) the
Borrowing Base, and (C) from and after the Budget Acceptance Date, the lesser of
(x) the Total Commitment and (y) the Borrowing Base.
(b) Upon the receipt of the Net Proceeds by any of the Borrowers or
their Subsidiaries from any Asset Sales for which the consideration received by
the Borrowers, taken together with any other Asset Sales, exceeds $5,000,000 in
the aggregate from the date of this Agreement, the Borrowers shall, jointly and
severally, apply such Net Proceeds as follows: first, to repay the then
outstanding Loans; second, deposit an amount in the Letter of Credit Account up
to 105% of the then Letter of Credit Outstandings; and thereafter, such Net
Proceeds may be retained by the Borrowers and invested in Permitted Investments
or used for expenditures in the ordinary course of business (subject to
compliance with the terms and conditions of this Agreement). The Commitments
shall be reduced on a pro rata basis by an amount equal to the sum of (i) the
Net Proceeds of the subject Asset Sale required to be applied to repay the then
outstanding Loans pursuant to preceding sentence, plus (ii) the Net Proceeds of
the subject Asset Sale retained by the Borrowers pursuant to the last clause of
the preceding sentence. Amounts on deposit in the Letter of Credit Account as of
the date of this Agreement shall remain on deposit and shall be applied in
accordance with the terms and conditions of this Agreement.
(c) If, on any date on which Loans are outstanding, Available Cash
exceeds $60,000,000, the Borrowers will provide notice thereof to the
Administrative Agent within one Business Day, and within one Business Day of the
date of such notice repay Loans in an amount equal to such excess (or if less,
in the amount of all outstanding Loans).
(d) Upon the Termination Date, the Total Commitment shall be
terminated in full and the Borrowers shall pay the Loans in full and, if any
Letter of Credit remains outstanding, comply with Section 2.3(b).
SECTION 2.14 Optional Prepayment of Loans; Reimbursement of Lenders.
(a) The Borrowers shall have the right at any time and from time to
time to prepay any Loans without penalty (except for any breakage costs
associated with Eurodollar Loans), in whole or in part, (x) with respect to
Eurodollar Loans, upon at least three (3) Business
33
Days' prior written, facsimile or telephonic (confirmed promptly in writing)
notice to the Administrative Agent and (y) with respect to ABR Loans, upon at
least one (1) Business Day's prior written, facsimile or telephonic (confirmed
promptly in writing) notice to the Administrative Agent; provided, however, that
(i) each such partial prepayment shall be in integral multiples of $1,000,000,
(ii) no prepayment of Eurodollar Loans shall be permitted pursuant to this
Section 2.14(a) other than on the last day of an Interest Period applicable
thereto unless such prepayment is accompanied by the payment of the amounts
described in clause (i) of the first sentence of Section 2.14(b), and (iii) no
partial prepayment of a Borrowing of Eurodollar Loans shall result in the
aggregate principal amount of the Eurodollar Loans remaining outstanding
pursuant to such Borrowing being less than $5,000,000. Each notice of prepayment
shall specify the prepayment date, the principal amount of the Loans to be
prepaid and in the case of Eurodollar Loans, the Borrowing or Borrowings
pursuant to which made, shall be irrevocable and shall commit the Parent
Borrower or a Subsidiary Borrower, as the case may be, to prepay such Loan by
the amount and on the date stated therein. The Administrative Agent shall,
promptly after receiving notice from the Parent Borrower or a Subsidiary
Borrower, as the case may be, hereunder, notify each Lender of the principal
amount of the Loans held by such Lender which are to be prepaid, the prepayment
date and the manner of application of the prepayment.
(b) The Borrowers shall reimburse each Lender on demand for any loss
incurred or to be incurred by it in the reemployment of the funds released (i)
resulting from any prepayment (for any reason whatsoever, including, without
limitation, refinancing with ABR Loans) of any Eurodollar Loan required or
permitted under this Agreement, if such Loan is prepaid other than on the last
day of the Interest Period for such Loan (including, without limitation, any
such prepayment in connection with the syndication of the credit facility
evidenced by this Agreement) or (ii) in the event that after the Borrowers
deliver a notice of Borrowing under Section 2.6 in respect of Eurodollar Loans,
such Loans are not made on the first day of the Interest Period specified in
such notice of Borrowing for any reason other than a breach by such Lender of
its obligations hereunder. Such loss shall be the amount as reasonably
determined by such Lender as the excess, if any, of (A) the amount of interest
which would have accrued to such Lender on the amount so paid or not borrowed at
a rate of interest equal to the Adjusted LIBOR Rate for such Loan, for the
period from the date of such payment or failure to borrow to the last day (x) in
the case of a payment or refinancing with ABR Loans other than on the last day
of the Interest Period for such Loan, of the then current Interest Period for
such Loan, or (y) in the case of such failure to borrow, of the Interest Period
for such Loan which would have commenced on the date of such failure to borrow,
over (B) the amount of interest which would have accrued to such Lender on such
amount by placing such amount on deposit for a comparable period with leading
banks in the London interbank market. Each Lender shall deliver to the Borrowers
from time to time one or more certificates setting forth the amount of such loss
as determined by such Lender.
(c) In the event the Parent Borrower or a Subsidiary Borrower, as the
case may be, fails to prepay any Loan on the date specified in any prepayment
notice delivered pursuant to Section 2.14(a), the Parent Borrower or the
applicable Subsidiary Borrower, as the case may be, on demand by any Lender
shall pay to the Administrative Agent for the account of such Lender any amounts
required to compensate such Lender for any loss incurred by such Lender as a
result of such failure to prepay, including, without limitation, any loss, cost
or
34
expenses incurred by reason of the acquisition of deposits or other funds by
such Lender to fulfill deposit obligations incurred in anticipation of such
prepayment, but without duplication of any amounts paid under Section 2.14(b).
Each Lender shall deliver to the Parent Borrower or the applicable Subsidiary
Borrower, as the case may be, from time to time one or more certificates setting
forth the amount of such loss as determined by such Lender.
(d) Any partial prepayment of the Loans by the Parent Borrower or a
Subsidiary Borrower, as the case may be, pursuant to Sections 2.13 or 2.14 shall
be applied as specified by the Parent Borrower or the applicable Subsidiary
Borrower, as the case may be, or, in the absence of such specification, as
determined by the Administrative Agent, provided that in the latter case no
Eurodollar Loans shall be prepaid pursuant to Section 2.13 to the extent that
such Loan has an Interest Period ending after the required date of prepayment
unless and until all outstanding ABR Loans and Eurodollar Loans with Interest
Periods ending on such date have been repaid in full.
SECTION 2.15 Reserve Requirements; Change in Circumstances.
(a) Notwithstanding any other provision herein, if after the date of
this Agreement any change in applicable law or regulation or in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof (whether or not having the
force of law) shall change the basis of taxation of payments to any Lender of
the principal of or interest on any Eurodollar Loan made by such Lender or any
fees or other amounts payable hereunder (other than changes in respect of Taxes,
Other Taxes and taxes imposed on, or measured by, the net income or overall
gross receipts or franchise taxes of such Lender by the jurisdiction in which
such Lender has its principal office or in which the applicable lending office
for such Eurodollar Loan is located or by any political subdivision or taxing
authority therein, or by any other jurisdiction or by any political subdivision
or taxing authority therein other than a jurisdiction in which such Lender would
not be subject to tax but for the execution and performance of this Agreement),
or shall impose, modify or deem applicable any reserve, special deposit or
similar requirement against assets of, deposits with or for the account of or
credit extended by such Lender (except any such reserve requirement which is
reflected in the Adjusted LIBOR Rate) or shall impose on such Lender or the
London interbank market any other condition affecting this Agreement or the
Eurodollar Loans made by such Lender, and the result of any of the foregoing
shall be to increase the cost to such Lender of making or maintaining any
Eurodollar Loan or to reduce the amount of any sum received or receivable by
such Lender hereunder (whether of principal, interest or otherwise) by an amount
deemed by such Lender to be material, then the Borrowers will pay to such Lender
in accordance with paragraph (c) below such additional amount or amounts as will
compensate such Lender for such additional costs incurred or reduction suffered.
(b) If any Lender shall have determined that the adoption or
effectiveness after the date hereof of any law, rule, regulation or guideline
regarding capital adequacy, or any change in any of the foregoing or in the
interpretation or administration of any of the foregoing by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or any lending office of
such Lender) or any Lender's holding company with any request or directive
regarding capital adequacy (whether or not having the force of law) of any such
authority, central bank or
35
comparable agency, has or would have the effect of reducing the rate of return
on such Lender's capital or on the capital of such Lender's holding company, if
any, as a consequence of this Agreement, the Loans made by such Lender pursuant
hereto, such Lender's Commitment hereunder or the issuance of, or participation
in, any Letter of Credit by such Lender to a level below that which such Lender
or such Lender's holding company could have achieved but for such adoption,
change or compliance (taking into account Lender's policies and the policies of
such Lender's holding company with respect to capital adequacy) by an amount
deemed by such Lender to be material, then from time to time the Borrowers shall
pay to such Lender such additional amount or amounts as will compensate such
Lender or such Lender's holding company for any such reduction suffered.
(c) A certificate of each Lender setting forth such amount or amounts
as shall be necessary to compensate such Lender or its holding company as
specified in paragraph (a) or (b) above, as the case may be, shall be delivered
to the Borrowers and shall be conclusive absent manifest error. The Borrowers
shall pay each Lender the amount shown as due on any such certificate delivered
to it within ten (10) days after its receipt of the same. Any Lender receiving
any such payment shall promptly make a refund thereof to the Borrowers if the
law, regulation, guideline or change in circumstances giving rise to such
payment is subsequently deemed or held to be invalid or inapplicable.
(d) Failure on the part of any Lender to demand compensation for any
increased costs or reduction in amounts received or receivable or reduction in
return on capital with respect to any period shall not constitute a waiver of
such Lender's right to demand compensation with respect to such period or any
other period. The protection of this Section shall be available to each Lender
regardless of any possible contention of the invalidity or inapplicability of
the law, rule, regulation, guideline or other change or condition which shall
have occurred or been imposed.
SECTION 2.16 Change in Legality.
(a) Notwithstanding anything to the contrary contained elsewhere in
this Agreement, if (x) any change after the date of this Agreement in any law or
regulation or in the interpretation thereof by any Governmental Authority
charged with the administration thereof shall make it unlawful for a Lender to
make or maintain a Eurodollar Loan or to give effect to its obligations as
contemplated hereby with respect to a Eurodollar Loan or (y) at any time any
Lender determines that the making or continuance of any of its Eurodollar Loans
has become impracticable as a result of a contingency occurring after the date
hereof which adversely affects the London interbank market or the position of
such Lender in such market, then, by written notice to the Borrowers, such
Lender may (i) declare that Eurodollar Loans will not thereafter be made by such
Lender hereunder, whereupon any request by the Borrowers for a Eurodollar
Borrowing shall, as to such Lender only, be deemed a request for an ABR Loan
unless such declaration shall be subsequently withdrawn; and (ii) require that
all outstanding Eurodollar Loans made by it be converted to ABR Loans, in which
event all such Eurodollar Loans shall be automatically converted to ABR Loans as
of the effective date of such notice as provided in paragraph (b) below. In the
event any Lender shall exercise its rights under clause (i) or (ii) of this
paragraph (a), all payments and prepayments of principal which would otherwise
have been applied to repay the Eurodollar Loans that would have been made by
such Lender or the
36
converted Eurodollar Loans of such Lender shall instead be applied to repay the
ABR Loans made by such Lender in lieu of, or resulting from the conversion of,
such Eurodollar Loans.
(b) For purposes of this Section 2.16, a notice to the Borrowers by
any Lender pursuant to paragraph (a) above shall be effective, if lawful, and if
any Eurodollar Loans shall then be outstanding, on the last day of the
then-current Interest Period, otherwise, such notice shall be effective on the
date of receipt by the Borrowers.
SECTION 2.17 Pro Rata Treatment, etc. All payments and repayments of
principal and interest in respect of the Loans (except as provided in Sections
2.15 and 2.16) shall be made pro rata among the Lenders in accordance with the
then outstanding principal amount of the Loans and/or participations in Letter
of Credit Outstandings hereunder and all payments of Commitment Fees and
Letter of Credit Fees (other than those payable to a Fronting Bank) shall be
made pro rata among the Lenders in accordance with their Commitments. All
payments by the Borrowers hereunder shall be (i) except as otherwise provided
in Section 2.18, net of any tax applicable to the Borrowers and (ii) made in
Dollars in immediately available funds, without defense, setoff or
counterclaim and free of any restriction or condition, at the office of the
Administrative Agent by 12:00 p.m., New York City time, on the date on which
such payment shall be due. Interest in respect of any Loan hereunder shall
accrue from and including the date of such Loan to but excluding the date on
which such Loan is paid in full or converted to a Loan of a different Type.
SECTION 2.18 Taxes.
(a) Except as otherwise provided in this Section 2.18, any and all
payments by the Borrowers hereunder shall be made free and clear of and without
deduction for any and all current or future taxes, levies, imposts, deductions,
charges or withholdings, and all liabilities with respect thereto, excluding (i)
taxes imposed on or measured by the net income, net profit or overall gross
receipts of the Administrative Agent or any Lender (or any transferee or
assignee thereof, including a participation holder (any such entity being called
a "Transferee")) and franchise taxes imposed on the Administrative Agent or any
Lender (or Transferee) by the United States or any jurisdiction under the laws
of which the Administrative Agent or any such Lender (or Transferee) is
organized or in which the applicable lending office of any such Lender (or
Transferee) or applicable office of the Administrative Agent, is located or any
political subdivision thereof or by any other jurisdiction or by any political
subdivision or taxing authority therein other than a jurisdiction in which the
Administrative Agent or such Lender (or Transferee) would not be subject to tax
but for the execution and performance of this Agreement and (ii) taxes, levies,
imposts, deductions, charges or withholdings ("Amounts") with respect to
payments hereunder to a Lender (or Transferee) or the Administrative Agent in
accordance with laws in effect on the later of the date of this Agreement and
the date such Lender (or Transferee) or the Administrative Agent becomes a
Lender (or Transferee or Administrative Agent, as the case may be) but not
excluding, with respect to such Lender (or Transferee) or the Administrative
Agent, any increase in such Amounts solely as a result of any change in such
laws occurring after such later date or any Amounts that would not have been
imposed but for actions (other than actions contemplated by this Agreement)
taken by the Borrowers after such later date (all such nonexcluded taxes,
levies, imposts, deductions, charges, withholdings and liabilities being
hereinafter referred to as "Taxes"). If the Borrowers shall be required by law
to
37
deduct any Taxes from or in respect of any sum payable hereunder to the Lenders
(or any Transferee) or the Administrative Agent, (i) the sum payable shall be
increased by the amount necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section)
such Lender (or Transferee) or the Administrative Agent (as the case may be)
shall receive an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrowers shall make such deductions and (iii)
the Borrowers shall pay the full amount deducted to the relevant taxing
authority or other Governmental Authority in accordance with applicable law.
(b) In addition, the Borrowers agree to pay any current or future
stamp or documentary taxes or any other excise or property taxes, charges,
assessments or similar levies that arise from any payment made hereunder or from
the execution, delivery or registration of, or otherwise with respect to, this
Agreement or any other Loan Document (hereinafter referred to as "Other Taxes").
(c) The Borrowers will indemnify each Lender (or Transferee) and the
Administrative Agent for the full amount of Taxes and Other Taxes paid by such
Lender (or Transferee) or the Administrative Agent, as the case may be, and any
liability (including penalties, interest and expenses) arising therefrom or with
respect thereto, whether or not such Taxes or Other Taxes were correctly or
legally asserted by the relevant taxing authority or other Governmental
Authority. Such indemnification shall be made within thirty (30) days after the
date any Lender (or Transferee) or the Administrative Agent, as the case may be,
makes written demand therefor. If a Lender (or Transferee) or the Administrative
Agent shall become aware that it is entitled to receive a refund in respect of
Taxes or Other Taxes as to which it has been indemnified by the Borrowers
pursuant to this Section, it shall promptly notify the Borrowers of the
availability of such refund and shall, within thirty (30) days after receipt of
a request by the Borrowers, apply for such refund at the Borrowers' expense. If
any Lender (or Transferee) or the Administrative Agent receives a refund in
respect of any Taxes or Other Taxes as to which it has been indemnified by the
Borrowers pursuant to this Section, it shall promptly notify the Borrowers of
such refund and shall, within thirty (30) days after receipt of a request by the
Borrowers (or promptly upon receipt, if the Borrowers have requested application
for such refund pursuant hereto), repay such refund to the Borrowers (to the
extent of amounts that have been paid by the Borrowers under this Section with
respect to such refund plus interest that is received by the Lender (or
Transferee) or the Administrative Agent as part of the refund), net of all
out-of-pocket expenses of such Lender (or Transferee) or the Administrative
Agent and without additional interest thereon; provided that the Borrowers, upon
the request of such Lender (or Transferee) or the Administrative Agent, agree to
return such refund (plus penalties, interest or other charges) to such Lender
(or Transferee) or the Administrative Agent in the event such Lender (or
Transferee) or the Administrative Agent is required to repay such refund.
Nothing contained in this sub-Section (c) shall require any Lender (or
Transferee) or the Administrative Agent to make available any of its tax returns
(or any other information relating to its taxes that it deems to be
confidential).
(d) Within thirty (30) days after the date of any payment of Taxes or
Other Taxes withheld by the Borrowers in respect of any payment to any Lender
(or Transferee) or the Administrative Agent, the Borrowers will furnish to the
Administrative Agent, at its address
38
referred to on the signature pages hereof, the original or a certified copy of a
receipt evidencing payment thereof.
(e) Without prejudice to the survival of any other agreement contained
herein, the agreements and obligations contained in this Section shall survive
the payment in full of the principal of and interest on all Loans made
hereunder.
(f) Each Lender (and Transferee) and the Administrative Agent shall,
if not a United States Person (as such term is defined in Section 7701(a)(30) of
the Code), on or prior to the Closing Date (in the case of each Lender listed on
the signature pages hereof on the Closing Date) or on or prior to the date of
the Assignment and Acceptance pursuant to which it becomes a Lender (in the case
of each other Lender), deliver to the Borrowers and the Administrative Agent
such certificates, documents and other evidence, as required by the Code or
Treasury Regulations issued pursuant thereto, including two original copies of
(A) Internal Revenue Service Form W-9 (unless such Lender (or Transferee) or the
Administrative Agent is an "exempt recipient" as defined in Treasury Regulations
Section 1.6049-4(c) for which no withholding is required) and two original
copies of (B) Internal Revenue Service Forms 1001, 4224, W-8BEN or W-8ECI and
any other certificate or statement of exemption required by Treasury Regulation
Section 1.1441-1, 1.1441-4 or 1.1441-6(c) or any subsequent version thereof or
successors thereto, properly completed and duly executed by such Lender (or
Transferee) or the Administrative Agent to establish that such payment is (i)
not subject to United States Federal withholding tax under the Code because such
payment is effectively connected with the conduct by such Lender (or Transferee)
or the Administrative Agent of a trade or business in the United States or (ii)
totally exempt from United States Federal withholding tax or subject to a
reduced rate of such tax under a provision of an applicable tax treaty. Unless
the Borrowers and the Administrative Agent have received forms or other
documents satisfactory to them indicating that such payments hereunder are not
subject to United States Federal withholding tax or are subject to such tax at a
rate reduced by an applicable tax treaty, the Borrowers or the Administrative
Agent shall withhold taxes from such payments at the applicable statutory rate.
(g) The Borrowers shall not be required to pay any additional amounts
to any Lender (or Transferee) or the Administrative Agent in respect of United
States Federal withholding tax pursuant to sub- Section(a) above if the
obligation to pay such additional amounts would not have arisen but for a
failure by such Lender (or Transferee) or the Administrative Agent to comply
with the provisions of sub- Section(f) above.
(h) Any Lender (or Transferee) or the Administrative Agent claiming
any additional amounts payable pursuant to this Section 2.18 shall use
reasonable efforts (consistent with legal and regulatory restrictions) to file
any certificate or document requested by the Borrowers or to change the
jurisdiction of its applicable lending office if the making of such a filing or
change would avoid the need for or reduce the amount of any such additional
amounts that may thereafter accrue and would not, in the sole determination of
such Lender (or Transferee) or the Administrative Agent, be otherwise materially
disadvantageous to such Lender (or Transferee) or the Administrative Agent.
39
SECTION 2.19 Certain Fees. The Borrowers shall pay to the Administrative
Agent, for the respective accounts of the Administrative Agent and the
Lenders, the fees set forth in that certain fee letter dated January 31, 2007
among the Administrative Agent, X.X. Xxxxxx Securities Inc. and the Borrowers
at the times set forth therein. The Administrative Agent shall be entitled,
after consultation with the Borrowers, to change certain of the pricing and
terms of this Agreement if syndication has not been completed and if the
Administrative Agent determines that such changes are advisable to insure a
successful syndication.
SECTION 2.20 Commitment Fee. The Borrowers shall pay to the Lenders a
commitment fee (the "Commitment Fee") for the period commencing on the date
the Commitment Letter was executed to the Termination Date or the earlier date
of termination of the Commitment calculated (on the basis of the actual number
of days elapsed over a year of 360 days) at a rate equal to the Commitment Fee
Percentage on the average daily Unused Total Commitment during the preceding
quarter. The issuance of Letters of Credit shall be treated as usage of the
Commitment. Such Commitment Fee, to the extent then accrued, shall be payable
(x) monthly, in arrears, three (3) Business Days after the last calendar day
of each month, (y) on the Termination Date and (z) as provided in Section 2.10
hereof, upon any reduction or termination in whole or in part of the Total
Commitment.
SECTION 2.21 Letter of Credit Fees. The Borrowers shall pay with respect
to each Letter of Credit (i) to the Administrative Agent on behalf of the
Lenders a fee calculated (on the basis of the actual number of days elapsed
over a year of 360 days) at a rate equal to 2.75% per annum on the undrawn
stated amount thereof, and (ii) to the Fronting Bank such Fronting Bank's
customary fees for issuance, amendments and processing referred to in Section
2.3. In addition, the Borrowers agree to pay each Fronting Bank for its
account a fronting fee in respect of each Letter of Credit issued by such
Fronting Bank, for the period from and including the date of issuance of such
Letter of Credit to and including the date of termination of such Letter of
Credit, computed at the rate set forth in the fee letter referenced in Section
2.19 above, or, if the Fronting Bank is a bank other than JPMCB, as separately
agreed by the Borrowers and such Fronting Bank, and payable at times to be
determined by such Fronting Bank, the Borrowers and the Administrative Agent.
Accrued fees described in clause (i) of the first sentence of this paragraph
in respect of each Letter of Credit shall be due and payable monthly in
arrears three (3) Business Days after the last calendar day of each month and
on the Termination Date, or such earlier date as the Total Commitment is
terminated. Accrued fees described in clause (ii) of the first sentence of
this paragraph in respect of each Letter of Credit shall be payable at times
to be determined by the Fronting Bank, the Borrowers and the Administrative
Agent.
SECTION 2.22 Nature of Fees. All Fees shall be paid on the dates due, in
immediately available funds, to the Administrative Agent for the respective
accounts of the Administrative Agent and the Lenders, as provided herein and
in the letter described in Section 2.19. Once paid, none of the Fees shall be
refundable under any circumstances.
SECTION 2.23 Priority and Liens.
(a) Each of the Borrowers hereby covenants, represents and warrants
that, upon entry of the Final Order, the Obligations of the Borrowers hereunder
and under the Loan
40
Documents and in respect of Indebtedness permitted by Section 6.3(v): (i)
pursuant to Section 364(c)(1) of the Bankruptcy Code, shall at all times
constitute an allowed Superpriority Claim; (ii) pursuant to Section 364(c)(2) of
the Bankruptcy Code, shall at all times be secured by a perfected first priority
Lien on all unencumbered property of the Borrowers and on all cash maintained in
the Letter of Credit Account and any direct investments of the funds contained
therein, provided that following the Termination Date, amounts in the Letter of
Credit Account shall not be subject to the Carve-Out; (iii) pursuant to Section
364(c)(3) of the Bankruptcy Code, shall be secured by a perfected Lien upon all
property of the Borrowers that is subject to valid and perfected Liens in
existence on the Filing Date or that is subject to valid Liens in existence on
the Filing Date that are perfected subsequent to the Filing Date as permitted by
Section 546(b) of the Bankruptcy Code; and in addition, (iv) pursuant to Section
364(d)(1) of the Bankruptcy Code and other than as expressly set forth in the
Final Order, be secured by a perfected first priority, senior priming Lien on
all of the property of the Borrowers (including, without limitation, inventory,
receivables, rights under license agreements, and property, plant and equipment)
that is subject to the existing liens which secure (x) the obligations of the
Parent Borrower and certain of the Subsidiary Borrowers under or in connection
with the Pre-Petition Credit Agreement, and (y) other obligations or
indebtedness of the Borrowers pursuant to other agreements in an aggregate
amount in excess of $2,500,000 (collectively, the "Primed Liens"), which Primed
Liens shall be primed by and made subject and subordinate to the perfected first
priority senior Liens to be granted to the Administrative Agent, which senior
priming Liens in favor of the Administrative Agent shall also prime any Liens
granted after the commencement of the Cases to provide adequate protection Liens
in respect of any of the Primed Liens but shall not prime Liens, if any, to the
extent such Liens secure obligations (other than obligations under the
Pre-Petition Credit Agreement) in an aggregate amount less than or equal to
$2,500,000; subject in each case only to (x) in the event of the occurrence and
during the continuance of an Event of Default or an event that would constitute
an Event of Default with the giving of notice or lapse of time or both (a
"Default"), the payment of allowed and unpaid professional fees and
disbursements incurred by the Borrowers and any statutory committees appointed
in the Cases in an aggregate amount not in excess of $3,000,000 (plus the amount
set forth in the most recent Borrowing Base Certificate delivered by the
Borrowers to the Administrative Agent of then unpaid professional fees and
expenses incurred prior to the occurrence of a Default or an Event of Default to
the extent that such unpaid fees and expenses are subsequently allowed by the
Bankruptcy Court), and (y) the payment of fees pursuant to 28 U.S.C. ss. 1930
and to the Clerk of the Bankruptcy Court (collectively, the "Carve-Out"),
provided that no portion of the Carve-Out shall be utilized for the payment of
professional fees and disbursements incurred in connection with any challenge to
the amount, extent, priority, validity, perfection or enforcement of the
Indebtedness of the Borrowers owed with respect to the parties primed by the
priming Liens or to the collateral securing such Indebtedness or any other
action against such parties. Amounts in the Letter of Credit Account shall not
be subject to the Carve-Out. By execution hereof, the Borrowers hereby consent
to the priming Liens referenced in clause (iv) above. Notwithstanding the
foregoing, so long as no Default or Event of Default shall have occurred and be
continuing, the Borrowers shall be permitted to pay compensation and
reimbursement of expenses allowed and payable under 11 U.S.C. xx.xx. 328, 330
and 331, as the same may be due and payable, and any compensation and expenses
previously paid, or accrued but unpaid, prior to the occurrence of such Default
or Event of Default shall not reduce the Carve-Out.
41
(b) Subject to the priorities set forth in subsection (a) above and to
the Carve-Out, as to all real property the title to which is held by a Borrower,
or the possession of which is held by a Borrower pursuant to leasehold interest,
the Parent Borrower and each of the Subsidiary Borrowers hereby assign and
convey as security, grant a security interest in, hypothecate, mortgage, pledge
and set over unto the Administrative Agent on behalf of the Lenders all of the
right, title and interest of the Borrowers, in all of such owned real property
and in all such leasehold interests, together in each case with all of the
right, title and interest of the Borrowers in and to all buildings,
improvements, and fixtures related thereto, any lease or sublease thereof, all
general intangibles relating thereto and all proceeds thereof. The Parent
Borrower and each of the Subsidiary Borrowers acknowledge that, pursuant to the
Interim Order (or the Final Order, as applicable), the Liens in favor of the
Administrative Agent on behalf of the Lenders in all of such real property and
leasehold instruments of the Borrowers shall be perfected without the
recordation of any instruments of mortgage or assignment. The Parent Borrower
and each of the Subsidiary Borrowers further agree that, upon the request of the
Administrative Agent, in the exercise of its business judgment, the Parent
Borrower and each of the Subsidiary Borrowers shall enter into separate fee
mortgages in recordable form with respect to such properties on terms
satisfactory to the Administrative Agent.
(c) To the extent any Borrower makes aggregate payments to the Lenders
in excess of the aggregate amount of all Loans received by such Borrower from
the Lenders after the commencement of the Cases, then such Borrower, after the
payment in full of all obligations of the Borrowers in respect of the Commitment
and the termination of the Commitment, shall be entitled to a claim under
Section 364(c)(1) of the Bankruptcy Code against each other Borrower, in such
amount as may be determined by the Bankruptcy Court taking into account the
relative benefits received by each such person, and such claims shall be deemed
to be subordinate and junior in all respects to the superpriority claims of the
Lenders and the superpriority claims granted as adequate protection to the
Primed Parties.
SECTION 2.24 Use of Cash Collateral. Notwithstanding anything to the
contrary contained herein, neither the Parent Borrower nor any Subsidiary
Borrower shall be permitted (i) to request a Borrowing under Section 2.6 or
request the issuance of a Letter of Credit under Section 2.3 unless the
Bankruptcy Court shall have entered the Interim Order, or (ii) to request a
Borrowing under Section 2.6 unless the Borrowers shall at that time have the
use of all cash collateral subject to the Orders for the purposes described in
Section 3.10.
SECTION 2.25 Right of Set-Off. Subject to the provisions of Section 7.1,
upon the occurrence and during the continuance of any Event of Default, the
Administrative Agent and each Lender is hereby authorized at any time and from
time to time, to the fullest extent permitted by law and without further order
of or application to the Bankruptcy Court, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any
time held and other Indebtedness at any time owing by the Administrative Agent
and each such Lender to or for the credit or the account of any Borrower
against any and all of the obligations of such Borrower now or hereafter
existing under the Loan Documents, irrespective of whether or not such Lender
shall have made any demand under any Loan Document and although such
obligations may not have been accelerated. Each Lender and the Administrative
Agent agrees promptly to notify the Borrowers after any such set-off and
application made by such Lender or by the Administrative Agent, as the case
may be, provided that the failure to give such notice
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shall not affect the validity of such set-off and application. The rights of
each Lender and the Administrative Agent under this Section are in addition to
other rights and remedies which such Lender and the Administrative Agent may
have upon the occurrence and during the continuance of any Event of Default.
SECTION 2.26 Security Interest in Letter of Credit Account. Pursuant to
Section 364(c)(2) of the Bankruptcy Code, the Borrowers hereby assign and
pledge to the Administrative Agent, for its benefit and for the ratable
benefit of the Lenders, and hereby grant to the Administrative Agent, for its
benefit and for the ratable benefit of the Lenders, a first priority security
interest, senior to all other Liens, if any, in all of the Borrowers' right,
title and interest in and to the Letter of Credit Account and any direct
investment of the funds contained therein. Cash held in the Letter of Credit
Account shall not be available for use by the Borrowers, whether pursuant to
Section 363 of the Bankruptcy Code or otherwise.
SECTION 2.27 Payment of Obligations. Subject to the provisions of Section
7.1, upon the maturity (whether by acceleration or otherwise) of any of the
Obligations under this Agreement or any of the other Loan Documents of the
Borrowers, the Lenders shall be entitled to immediate payment of such
Obligations without further application to or order of the Bankruptcy Court.
The Parent Borrower and each of the Subsidiary Borrowers shall be jointly and
severally liable for payment of any Obligations under this Agreement or any of
the other Loan Documents.
SECTION 2.28 No Discharge; Survival of Claims. Each of the Borrowers
agrees that (i) its obligations hereunder shall not be discharged by the entry
of an order confirming a Reorganization Plan (and each of the Borrowers,
pursuant to Section 1141(d)(4) of the Bankruptcy Code, hereby waives any such
discharge) and (ii) the Superpriority Claim granted to the Administrative
Agent and the Lenders pursuant to the Order and described in Section 2.23
shall not be affected in any manner by the entry of an order confirming a Plan
of Reorganization.
SECTION 2.29 Replacement of Certain Lenders. In the event a Lender
("Affected Lender") shall have: (i) failed to fund its Commitment Percentage
of any Loan requested by the Borrowers or to fund its Commitment Percentage of
any unreimbursed payment made by the Fronting Bank, which such Lender is
obligated to fund under the terms of this Agreement and which failure has not
been cured, (ii) requested compensation from the Borrowers under Section 2.15
with respect to increased costs or capital or under Section 2.18 to recover
Taxes, Other Taxes or other additional costs incurred by such Lender which, in
any case, are not being incurred generally by the other Lenders, or (iii)
delivered a notice pursuant to Section 2.16 claiming that such Lender is
unable to extend Eurodollar Loans to the Borrowers for reasons not generally
applicable to the other Lenders, then, in any case, the Borrowers or the
Administrative Agent may make written demand on such Affected Lender (with a
copy to the Administrative Agent in the case of a demand by the Borrowers and
a copy to the Borrowers in the case of a demand by the Administrative Agent)
for the Affected Lender to assign, and such Affected Lender shall use
commercially reasonable efforts to assign pursuant to one or more duly
executed Assignments and Acceptances five (5) Business Days after the date of
such demand, to one or more financial institutions that comply with the
provisions of Section 9.3 which the Borrowers or the Administrative Agent, as
the case may be, shall have engaged for such purpose ("Replacement Lender"),
all of such Affected Lender's rights and obligations under this
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Agreement and the other Loan Documents (including, without limitation, its
Commitment, all Loans owing to it, all of its participation interests in
existing Letters of Credit, and its obligation to participate in additional
Letters of Credit hereunder) in accordance with Section 9.3. The
Administrative Agent agrees, upon the occurrence of such events with respect
to an Affected Lender and upon the written request of the Borrowers, to use
its reasonable efforts to obtain the Commitments from one or more financial
institutions to act as a Replacement Lender. The Administrative Agent is
authorized to execute one or more of such Assignments and Acceptances as
attorney-in-fact for any Affected Lender failing to execute and deliver the
same within five (5) Business Days after the date of such demand. Further,
with respect to such assignment the Affected Lender shall have concurrently
received, in cash, all amounts due and owing to the Affected Lender hereunder
or under any other Loan Document, including, without limitation, the aggregate
outstanding principal amount of the Loans owed to such Lender, together with
accrued interest thereon through the date of such assignment, amounts payable
under Section 2.15 with respect to such Affected Lender and compensation
payable under Section 2.20 in the event of any replacement of any Affected
Lender under clause (ii) or clause (iii) of this Section 2.29; provided that
upon such Affected Lender's replacement, such Affected Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits of
Sections 2.15, 9.5 and 9.6, as well as to any fees accrued for its account
hereunder and not yet paid, and shall continue to be obligated under Section
8.6 with respect to losses, obligations, liabilities, damages, penalties,
actions, judgments, costs, expenses or disbursements for matters which
occurred prior to the date the Affected Lender is replaced.
SECTION 3. REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders to make Loans and issue and/or
participate in Letters of Credit hereunder, the Parent Borrower and each of the
Subsidiary Borrowers, jointly and severally, represent and warrant as follows:
SECTION 3.1 Organization and Authority. Each of the Borrowers (i) is duly
organized, validly existing and in good standing under the law of its
jurisdiction of organization; (ii) is duly qualified to do business and in
good standing in each jurisdiction in which the failure to so qualify would
have a Material Adverse Effect; (iii) subject to the entry by the Bankruptcy
Court of the Interim Order (or the Final Order or the Amendment Order, as
applicable), has the requisite power and authority to effect the transactions
contemplated hereby, and by the other Loan Documents to which it is a party,
and (iv) subject to the entry by the Bankruptcy Court of the Interim Order (or
the Final Order or the Amendment Order, as applicable), has all requisite
power and authority and the legal right to own and operate its properties, and
to conduct its business as now or currently proposed to be conducted.
SECTION 3.2 Due Execution. Upon the entry by the Bankruptcy Court of the
Interim Order (or the Final Order or the Amendment Order, as applicable), the
execution, delivery and performance by each of the Borrowers of each of the
Loan Documents to which it is a party, including, without limitation, the
grant and pledge by each of the Borrowers of the security interests granted by
the Security and Pledge Agreement, (i) are within the respective powers of
each of the Borrowers have been duly authorized by all necessary action,
including the consent of shareholders, partners or members, where required,
and do not (A) contravene the Organizational Documents of any of the
Borrowers, (B) violate any law (including, without limitation, the Securities
Exchange Act of 1934) or regulation (including,
44
without limitation, Regulations T, U or X of the Board), or any order or
decree of any court or Governmental Authority, (C) conflict with or result in
a breach of, or constitute a default under, any indenture, mortgage or deed of
trust entered into after the Filing Date or any lease, agreement or other
instrument entered into after the Filing Date binding on the Borrowers or any
of their respective properties, or (D) result in or require the creation or
imposition of any Lien upon any of the property of any of the Borrowers other
than Liens granted pursuant to this Agreement; and (ii) do not require the
consent, authorization by or approval of or notice to or filing or
registration with any Governmental Authority other than the entry of the
Interim Order (or the Final Order or the Amendment Order, as applicable).
Except for the entry of the Interim Order (or the Final Order or the Amendment
Order, as applicable) no authorization, approval or other action by, and no
notice to or filing with, any Governmental Authority or regulatory body is
required for the perfection of the security interests or the exercise by the
Administrative Agent or the Lenders of their respective rights and remedies
under the Loan Documents. Upon the entry by the Bankruptcy Court of the
Interim Order (or the Final Order or the Amendment Order, as applicable), this
Agreement shall have been duly executed and delivered by each of the
Borrowers. Upon the entry by the Bankruptcy Court of the Interim Order (or the
Final Order or the Amendment Order, as applicable), this Agreement, and each
of the other Loan Documents to which the Borrowers are or will be a party,
when delivered hereunder or thereunder, will be, a legal, valid and binding
obligation of each Borrower, enforceable against the Borrowers in accordance
with its terms and the Orders.
SECTION 3.3 Statements Made. The information that has been delivered in
writing by any of the Borrowers to the Administrative Agent or to the
Bankruptcy Court in connection with any Loan Document, and any financial
statement delivered pursuant hereto or thereto (other than to the extent that
any such statements constitute projections), taken as a whole and in light of
the circumstances in which made, contains no untrue statement of a material
fact and does not omit to state a material fact necessary to make such
statements not misleading; and, to the extent that any such information
constitutes projections, such projections were prepared in good faith on the
basis of assumptions, methods, data, tests and information believed by the
Borrowers to be reasonable at the time such projections were furnished. All
representations and warranties, as made or deemed made as of a particular
time, shall survive execution of each of the Loan Documents and the making of
each Loan or issuance of each Letter of Credit, and may be relied upon by the
Administrative Agent and the Lenders as being true and correct as of the date
when made or deemed made until all of the Borrowers' Obligations are fully and
indefeasibly paid.
SECTION 3.4 Financial Statements. The Borrowers have furnished the
Lenders with copies of the audited consolidated financial statements and
schedules of the Borrowers and their Subsidiaries for the fiscal year ended
June 3, 2006. Such financial statements present fairly the financial condition
and results of operations of the Borrowers and their Subsidiaries on a
consolidated basis as of such date and for such period; such balance sheets
and the notes thereto disclose all liabilities, direct or contingent, of the
Borrowers and their Subsidiaries as of the dates thereof required to be
disclosed by GAAP and such financial statements were prepared in a manner
consistent with GAAP. No material adverse change in the operations,
businesses, properties, assets, prospects or condition (financial or
otherwise) of the Borrowers and their Subsidiaries, taken as a whole, has
occurred since June 3, 2006 other than those which
45
customarily occur as a result of events and circumstances following the
commencement of a proceeding under Chapter 11 of the Bankruptcy Code and the
commencement of the Cases and other than with respect to the ABA Pension Plan.
SECTION 3.5 Ownership. Each of the Persons listed on Schedule 3.5 is a
direct or indirect Subsidiary of the Borrowers and Schedule 3.5 correctly sets
forth the ownership interest of each of the Borrowers in their respective
Subsidiaries, in each case as of the Closing Date. None of the Borrowers owns
any other Subsidiaries, whether directly or indirectly, other than as set
forth on Schedule 3.5.
SECTION 3.6 Liens. There are no Liens of any nature whatsoever on any
assets of any of the Borrowers other than (i) Permitted Liens, and (ii) Liens
in favor of the Administrative Agent and the Lenders. None of the Borrowers is
a party to any contract, agreement, lease or instrument the performance of
which, either unconditionally or upon the happening of an event, will result
in or require the creation of a Lien on any assets of any Borrower or
otherwise result in a violation of this Agreement other than the Liens granted
to the Administrative Agent and the Lenders as provided for in this Agreement.
SECTION 3.7 Compliance with Law.
(a) (i) The operations of the Borrowers and their Subsidiaries comply
in all material respects with all applicable environmental, health and safety
statutes and regulations, including, without limitation, regulations promulgated
under the Resource Conservation and Recovery Act (42 U.S.C. xx.xx. 6901 et
seq.); (ii) none of the operations of the Borrowers or their Subsidiaries is the
subject of any Federal or state investigation evaluating whether any remedial
action involving a material expenditure by the Borrowers is needed to respond to
a release of any Hazardous Waste or Hazardous Substance (as such terms are
defined in any applicable state or Federal environmental law or regulations)
into the environment; and (iii) the Borrowers and their Subsidiaries do not have
any material contingent liability in connection with any release of any
Hazardous Waste or Hazardous Substance into the environment.
(b) None of the Borrowers or their Subsidiaries is in violation of any
law, rule or regulation, or in default with respect to any judgment, writ,
injunction or decree of any Governmental Authority the violation of which, or a
default with respect to which, would have a Material Adverse Effect, other than
with respect to the ABA Pension Plan.
SECTION 3.8 Insurance. All policies of insurance of any kind or nature
owned by or issued to the Borrowers, including, without limitation, policies
of life, fire, theft, product liability, public liability, property damage,
other casualty, employee fidelity, workers' compensation, employee health and
welfare, title, property and liability insurance, are in full force and effect
and are of a nature and provide such coverage as is customarily carried by
companies of the size and character of the Borrowers.
SECTION 3.9 The Orders. On the date of the making of the initial Loans or
the issuance of the initial Letters of Credit hereunder, whichever first
occurs, the Interim Order will have been entered and will not have been
stayed, amended, vacated, reversed or rescinded except as approved by the
Administrative Agent, in its exclusive discretion. On the date of the making
46
of any Loan or the issuance of any Letter of Credit, the Interim Order, the
Final Order and the Amendment Order, as the case may be, shall have been
entered and shall not have been amended, stayed, vacated or rescinded except
as approved by the Administrative Agent, in its exclusive discretion. Upon the
maturity (whether by the acceleration or otherwise) of any of the obligations
of the Borrowers hereunder and under the other Loan Documents, the Lenders
shall, subject to the provisions of Section 7.1, be entitled to immediate
payment of such obligations, and to enforce the remedies provided for
hereunder, without further application to or order by the Bankruptcy Court.
SECTION 3.10 Use of Proceeds. The proceeds of the Loans shall be used in
accordance with Section 2.2, for (i) working capital, Letters of Credit and
Capital Expenditures; (ii) other general corporate purposes of the Borrowers;
(iii) payment of any related transaction costs, fees and expenses; and (iv)
the costs of administration of the Cases. After delivery of the Budget, all
such usage shall be substantially consistent with the Budget. The Letters of
Credit shall be issued in support of obligations of the Borrowers that are
acceptable to the Administrative Agent.
SECTION 3.11 Litigation. There are no unstayed actions, suits or
proceedings pending or, to the best knowledge of the Borrowers, threatened
against or affecting the Parent Borrower or any Subsidiary Borrower or any of
their respective properties, before any court or governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign,
that are reasonably likely to have a Material Adverse Effect.
SECTION 3.12 Intellectual Property. Set forth on Schedule 3.12 hereto is
a complete and accurate list of all patents, trademarks, trade names, service
marks and copyrights, and all applications therefor and licenses thereof, of
each Borrower, showing as of the date hereof the jurisdiction in which
registered, the registration number, the date of registration and the
expiration date.
SECTION 3.13 Taxes. Except to the extent permitted by Section 5.4 hereof,
each Borrower has filed or caused to be filed all federal, state and other
material tax returns that are required to be filed and has paid all Taxes
shown to be due and payable on said returns or on any assessments made against
it or any of its property and all other Taxes, fees or other charges imposed
on it or any of its property by any Governmental Authority (other than any the
amount or validity of which are currently being contested in good faith by
appropriate proceedings and with respect to which reserves, if any, in
conformity with GAAP have been provided on the books of such Borrower); no
material tax Lien has been filed, and, to the knowledge of the Borrowers, no
claim is being asserted, with respect to any such Tax, fee or other charge.
SECTION 3.14 Investment Company Act; Other Regulations. Neither the
Parent Borrower nor any Subsidiary Borrower is an "investment company", or a
company "controlled" by an "investment company", within the meaning of the
Investment Company Act of 1940, as amended. The Borrowers are not subject to
any organizational or governing document, or any law, treaty, rule or
regulation or determination of an arbitrator or a court or other Governmental
Authority that limits its ability to incur Indebtedness, other than the
Orders.
SECTION 3.15 ERISA Matters
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(a) The Borrowers and each of their ERISA Affiliates are in
substantial compliance with all applicable provisions and requirements of ERISA
with respect to each Plan, and have substantially performed all their
obligations under each Plan, except to the extent that any non-compliance with
ERISA or any such failure to perform (other than, in each case, solely with
respect to the ABA Pension Plan) would not result in material liability of the
Borrowers or any of their ERISA Affiliates.
(b) No Termination Event (excluding any such event attributable solely
with respect to the ABA Pension Plan) has occurred which has resulted, or is
reasonably likely to result, in any material liability to the PBGC or to any
other Person.
(c) Except to the extent required under Section 4980B of the Code
and/or Section 601 of ERISA, neither the Parent Borrower nor the Subsidiary
Borrower maintains or contributes to any employee welfare benefit plan (as
defined in Section 3(1) of ERISA) that provides health or welfare benefits
(through the purchase of insurance or otherwise) for any retired or former
employees of the Borrowers, except to the extent that the provision of such
benefits would not have a Material Adverse Effect.
SECTION 4. CONDITIONS OF LENDING
SECTION 4.1 Conditions Precedent to Initial Loan and Initial Letter of
Credit. The obligation of the Lenders to make the initial Loan or the Fronting
Bank to issue the initial Letter of Credit, whichever may occur first, is
subject to the following conditions precedent:
(a) Supporting Documents. The Administrative Agent shall have received
for each of the Borrowers:
(i) a copy of each Organizational Document originally executed and
delivered by each Borrower, and, to the extent applicable, certified as of
a recent date by the applicable Governmental Authority, each dated the
Closing Date or a recent date prior thereto;
(ii) signature and incumbency certificates of the officers of such
Borrower executing the Loan Documents to which it is a party, dated as of
the Closing Date;
(iii) duly adopted resolutions of the board of directors or similar
governing body of each Borrower approving and authorizing the execution,
delivery and performance of this Agreement and the other Loan Documents to
which it is a party or by which it or its assets may be bound as of the
Closing Date, certified as of the Closing Date by its secretary or
assistant secretary as being in full force and effect without modification
or amendment;
(iv) a good standing certificate from the applicable Governmental
Authority of each Borrower's jurisdiction of incorporation, organization or
formation and in each jurisdiction in which it is qualified as a foreign
corporation or other entity to do business, each dated a recent date prior
to the Closing Date; and
48
(v) such other documents as the Administrative Agent may reasonably
request.
(b) Interim Order. Not later than ten (10) days following the Filing
Date, the Administrative Agent and the Lenders shall have received a certified
copy of an order of the Bankruptcy Court in substantially the form of Exhibit A
or such other form as otherwise agreed by the Administrative Agent and the
Debtors (the "Interim Order") approving the Loan Documents and granting the
Superpriority Claim status and senior priming and other Liens described in
Section 2.23 which Interim Order (i) shall have been entered upon an application
or motion of the Borrowers, in form and substance satisfactory to the
Administrative Agent and on such prior notice to such parties as may be
satisfactory to the Administrative Agent, (ii) shall authorize extensions of
credit in amounts satisfactory to the Administrative Agent, (iii) shall approve
the payment by the Borrowers of all of the Fees set forth in Sections 2.19, 2.20
and 2.21, (iv) shall be in full force and effect, (v) shall not have been
stayed, reversed, modified or amended in any respect, and (vi) shall be entered
with the consent or non-objection of a preponderance (as determined by the
Administrative Agent) of the secured creditors of any of the Borrowers under the
Pre-Petition Credit Agreement, and (vi) if the Interim Order is the subject of a
pending appeal in any respect, neither the making of such Loan nor the issuance
of such Letter of Credit nor the performance by any of the Borrowers of any of
their obligations hereunder or under the Loan Documents or under any other
instrument or agreement referred to herein shall be the subject of a presently
effective stay pending appeal.
(c) Loan Documents. The Agent shall have received this Agreement, duly
executed and delivered by the Administrative Agent, the Parent Borrower, each
Subsidiary Borrower and each Initial Lender and the Parent Borrower and each
Subsidiary Borrower shall have duly executed and delivered to the Administrative
Agent a Security and Pledge Agreement in substantially the form of Exhibit B
(the "Security and Pledge Agreement").
(d) First Day Orders. All of the "first day orders" entered by the
Bankruptcy Court at the time of the commencement of the Cases shall be
reasonably satisfactory in form and substance to the Administrative Agent in its
exclusive discretion.
(e) Opinion of Counsel. The Administrative Agent and the Lenders shall
have received the favorable written opinion of counsel to the Borrowers,
acceptable to the Administrative Agent, substantially in the form of Exhibit D.
(f) Payment of Fees. The Borrowers shall have paid to the
Administrative Agent the then unpaid balance of all accrued and unpaid Fees due
under and pursuant to this Agreement and the letter referred to in Section 2.19.
(g) Corporate and Judicial Proceedings. All corporate and judicial
proceedings and all instruments and agreements in connection with the
transactions among the Borrowers, the Administrative Agent and the Lenders
contemplated by this Agreement shall be satisfactory in form and substance to
the Administrative Agent in its exclusive discretion, and the Administrative
Agent shall have received all information and copies of all documents and
papers, including records of corporate and judicial proceedings, which the
Administrative Agent
49
may have requested in connection therewith, such documents and papers where
appropriate to be certified by proper corporate, governmental or judicial
authorities.
(h) Information. The Administrative Agent shall have received such
information (financial or otherwise) as may be reasonably requested by the
Administrative Agent.
(i) Compliance with Laws. The Borrowers shall have granted the
Administrative Agent and Collateral Agent access to and the right to inspect all
reports, audits and other internal information of the Borrowers relating to
environmental matters and any third party verification of certain matters
relating to compliance with Environmental Laws requested by the Administrative
Agent.
(j) Closing Documents. The Administrative Agent shall have received
all documents required by this Agreement satisfactory in form and substance to
the Administrative Agent in its exclusive discretion.
(k) Lien Searches. The Administrative Agent shall have received lien
searches conducted in the jurisdictions in which the Borrowers are organized or
conduct business, satisfactory to the Administrative Agent (dated as of a date
reasonably satisfactory to the Agent), reflecting the absence of Liens and
encumbrances on the assets of the Borrowers other than Permitted Liens.
(l) Field Examinations. The Lenders shall have received appraisals of
all or such portions of the Borrowers' assets they may deem appropriate, which
appraisals shall be satisfactory in form and substance to the Administrative
Agent.
SECTION 4.2 Conditions Precedent to Each Loan and Each Letter of Credit.
The obligation of the Lenders to make each Loan and of the Fronting Bank to
issue each Letter of Credit, including the initial Loan and the initial Letter
of Credit, is subject to the following conditions precedent:
(a) Notice. The Administrative Agent shall have received a notice with
respect to each Borrowing or the issuance of each Letter of Credit, as the case
may be, as required by Section 2.
(b) Representations and Warranties. All representations and warranties
contained in this Agreement and the other Loan Documents shall be true and
correct in all material respects on and as of the date of each Borrowing or the
issuance of each Letter of Credit hereunder with the same effect as if made on
and as of such date except to the extent such representations and warranties
expressly relate to an earlier date.
(c) No Default. On the date of each Borrowing or the issuance of each
Letter of Credit hereunder, no Default or Event of Default shall have occurred
and be continuing.
(d) Orders. Prior to the date of entry of the Amendment Order by the
Bankruptcy Court, the Interim Order shall be in full force and effect and shall
not have been stayed, reversed, modified or amended in any respect without the
prior written consent of the
50
Administrative Agent, provided that at the time of the making of any Loan or the
issuance of any Letter of Credit the aggregate amount of either of which, when
added to the sum of the principal amount of all Loans then outstanding and the
Letter of Credit Outstandings, would exceed the amount authorized by the Interim
Order (collectively, the "Additional Credit"), the Administrative Agent and each
of the Lenders shall have received a certified copy of the order of the
Bankruptcy Court approving continued lending (the "Final Order") in such form as
may be agreed by the Administrative Agent and the Borrowers, which, in any
event, shall have been entered by the Bankruptcy Court no later than thirty-five
(35) days after the entry of the Interim Order, and at the time of the extension
of any Additional Credit the Final Order shall be in full force and effect, and
shall not have been stayed, reversed, modified or amended in any respect without
the prior written consent of the Administrative Agent; and, if either the
Interim Order or the Final Order is the subject of a pending appeal in any
respect, neither the making of the Loans nor the issuance of any Letter of
Credit nor the performance by any of the Borrowers of any of their obligations
under any of the Loan Documents or under any other instrument or agreement
referred to herein shall be the subject of a presently effective stay pending
appeal. From and after the date of entry of the Amendment Order by the
Bankruptcy Court, at the time of the extension of any Additional Credit, the
Final Order and the Amendment Order shall be in full force and effect, and shall
not have been stayed, reversed, modified, or amended in any respect without the
prior written consent of the Administrative Agent (except to the extent the
Amendment Order modifies the Final Order); and, if the Final Order or the
Amendment Order is the subject of a pending appeal in any respect, neither the
making of the Loans nor the issuance of any Letter of Credit nor the performance
by any of the Borrowers of any of their obligations under any of the Loan
Documents or under any other instrument or agreement referred to herein shall be
the subject of a presently effective stay pending appeal.
(e) Payment of Fees. The Borrowers shall have paid to the
Administrative Agent the then unpaid balance of all accrued and unpaid Fees then
due and payable under and pursuant to this Agreement and the letter referred to
in Section 2.19.
(f) Borrowing Base. If as a result of such extension of credit, usage
of the Total Commitment would exceed $100,000,000, and in any event no later
than the expiration of the Interim Period, the Borrowers, the Administrative
Agent and the Super-majority Lenders shall have entered into an Amendment to
this Agreement setting forth the Administrative Agent's determination of the
components of the Borrowing Base, and such Amendment shall be effective.
(g) Borrowing Base Certificate. Commencing with the expiration of the
Interim Period, the Administrative Agent shall have received a Borrowing Base
Certificate in accordance with Section 5.8 dated no more than seven (7) days
prior to each Borrowing or the issuance of each Letter of Credit, which
Borrowing Base Certificate shall include supporting schedules as required by the
Administrative Agent.
(h) Budget. If as a result of such extension of credit, usage of the
Total Commitment would exceed $150,000,000, and in any event no later than May
28, 2005, the Borrowers shall have delivered, and the Administrative Agent and
Xxxxxxxx Xxxxxx & Company or such other financial advisor as may be acceptable
to the Administrative Agent, shall have accepted, the Budget in accordance with
Section 5.1(g).
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(i) Usage. From and after the Borrowers' delivery and the
Administrative Agent's acceptance of the Forecast and until such time as the
Administrative Agent shall have accepted the Budget, the uses of such Borrowing
or such Letter of Credit shall be substantially consistent with such Forecast.
Thereafter, from and after Borrowers' delivery and the Administrative Agent's
acceptance of the Budget, the uses of such Borrowing or such Letter of Credit
shall be substantially consistent with the Budget, as updated from time to time.
(j) Other Conditions. Such other conditions as may be mutually agreed
upon by the Administrative Agent and the Borrowers.
Each Borrowing shall be deemed to constitute a representation and
warranty by the Borrowers on the date thereof that the conditions specified
above have been satisfied or waived.
SECTION 5. AFFIRMATIVE COVENANTS
From the date hereof and for so long as any Commitment shall be in
effect or any Letter of Credit shall remain outstanding (in a face amount in
excess of the amount of cash then held in the Letter of Credit Account, or in
excess of the face amount of back-to-back letters of credit delivered, in each
case pursuant to Section 2.3(b)), or any amount shall remain outstanding or
unpaid under this Agreement, each of the Borrowers and their respective
Subsidiaries agree that, unless the Required Lenders shall otherwise consent in
writing:
SECTION 5.1 Financial Statements, Reports, etc. The Borrowers and the
Subsidiaries will deliver to the Administrative Agent and each of the Lenders:
(a) within ninety (90) days after the end of each fiscal year,
consolidated balance sheets and related statements of income, stockholders'
equity, and cash flows, showing the financial condition of the Borrowers and
their Subsidiaries as of the close of such fiscal year and the results of their
respective operations during such year, such consolidated statements to be
certified by a Financial Officer of each of the Borrowers to the effect that
such consolidated financial statements fairly present the financial condition
and results of operations of the Borrowers on a consolidated basis in accordance
with GAAP; provided, that the requirement to deliver the financial statements
pursuant to this Section 5.1(a) shall be deemed to have been satisfied upon
delivery of the Borrowers' annual report on Form 10-K for such fiscal year;
(b) within forty five (45) days after the end of the first three
fiscal quarters of each fiscal year of the Borrowers, consolidated balance
sheets and related statements of income, stockholders' equity and cash flows,
showing the financial condition of the Borrowers and their Subsidiaries on a
consolidated basis, in each case as of the close of such fiscal quarter and the
results of their operations during such fiscal quarter and the then elapsed
portion of the fiscal year, each certified by a Financial Officer of each of the
Borrowers as fairly presenting the financial condition and results of operations
of the Borrowers on a consolidated basis in accordance with GAAP, subject to
normal year-end audit adjustments and the omission of the required footnotes to
the financial statements; provided, that the requirement to deliver the
financial statements pursuant to this Section 5.1(b) shall be deemed to have
been satisfied upon delivery of the Borrowers' quarterly report on Form 10-Q for
such fiscal quarter;
52
(c) concurrently with any delivery of financial statements under (a)
or (b) above as applicable, (i) a certificate of a Financial Officer of each of
the Borrowers (A) certifying that no Event of Default or event which upon notice
or lapse of time or both would constitute an Event of Default has occurred, or,
if such an Event of Default or event has occurred, specifying the nature and
extent thereof and any corrective action taken or proposed to be taken with
respect thereto and (B) setting forth computations in reasonable detail
satisfactory to the Administrative Agent demonstrating compliance with the
provisions of Sections 6.3, 6.4, 6.5 and 6.10 and (ii) a certificate of such
accountants accompanying the audited consolidated financial statements delivered
under (a) above certifying that, in the course of the regular audit of the
business of the Borrowers and their Subsidiaries, such accountants have obtained
no knowledge that an Event of Default has occurred and is continuing, or if, in
the opinion of such accountants, an Event of Default has occurred and is
continuing, specifying the nature thereof and all relevant facts with respect
thereto;
(d) commencing with monthly financial statements for the Borrowers'
fiscal month ending September 18, 2004, which shall be delivered to the
Administrative Agent and the Lenders as soon as possible, and in any event no
later than November 22, 2004, and thereafter within forty-five (45) days after
the end of each fiscal month, unaudited monthly consolidated balance sheets and
related statements of income and cash flows of the Borrowers and their
Subsidiaries (including the amount of Available Cash balances at the end of each
such fiscal month), in form and substance satisfactory to the Administrative
Agent and showing the results of the Borrowers operations during such fiscal
month and the then elapsed portion of the fiscal year;
(e) as soon as possible, and in any event no later than October 22,
2004, a forecast of the sources and uses of cash by the Borrowers on a weekly
basis for the succeeding thirteen (13) calendar weeks, in form and substance
satisfactory to the Administrative Agent and Xxxxxxxx Xxxxxx & Company or such
other financial advisor as may be acceptable to the Administrative Agent (as
updated from time to time pursuant to Section 5.1(f), the "Forecast");
(f) commencing on the date which is two (2) weeks after the Borrowers'
delivery of the Forecast pursuant to Section 5.1(e), and every two (2) weeks
thereafter, an update of the Forecast for the then succeeding thirteen (13)
calendar weeks, in form and substance satisfactory to the Administrative Agent
and Xxxxxxxx Xxxxxx & Company or such other financial advisor as may be
acceptable to the Administrative Agent;
(g) as soon as possible, and in any event no later than May 28, 2005,
a projected operating budget (which shall include income statements, balance
sheets and cash flow statements) detailing, on a monthly and quarterly basis,
the Borrowers' anticipated cash receipts and disbursements for the period ending
on the Maturity Date, and setting forth the anticipated uses of the Commitment,
in form and substance satisfactory to the Administrative Agent and Xxxxxxxx
Xxxxxx & Company, or such other financial advisor as may be acceptable to the
Administrative Agent (as updated from time to time pursuant to Section 5.1(i),
the "Budget");
(h) commencing as soon as possible, and in any event not later than
May 28, 2005, within forty-five (45) days after the end of each fiscal month, a
summary of the results of the Borrowers' business operations for the preceding
month as compared to the corresponding
53
period in the Budget, including a discussion of significant variances, which
summary shall describe results on the basis of the Borrowers and their
respective Subsidiaries on a consolidated basis;
(i) commencing with an update for the Borrowers' fiscal quarter ending
August 20, 2005, which shall be delivered to the Administrative Agent and the
Lenders no later than October 4, 2005, and thereafter within forty-five (45)
days after the end of the second fiscal quarter of each fiscal year of the
Borrowers, and within sixty (60) days from the end of the last fiscal quarter of
each fiscal year of the Borrowers, an update of the Budget satisfactory in form
and substance to the Administrative Agent and Xxxxxxxx Xxxxxx & Company or such
other financial advisor as may be acceptable to Administrative Agent, and be
available to discuss such updated Budget with the Administrative Agent upon the
Administrative Agent's reasonable request;
(j) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by it
with the Securities and Exchange Commission, or any governmental authority
succeeding to any of or all the functions of said commission, or with any
national securities exchange, as the case may be;
(k) as soon as available and in any event (A) within thirty (30) days
after any Borrower, any or any of their ERISA Affiliates knows or has reason to
know that any Termination Event described in clause (i) of the definition of
Termination Event with respect to any Single Employer Plan of any of the
Borrowers or such ERISA Affiliate has occurred and (B) within ten (10) days
after any of the Borrowers or any of their ERISA Affiliates knows or has reason
to know that any other Termination Event with respect to any such Plan has
occurred, a statement of a Financial Officer of such Borrower describing such
Termination Event and the action, if any, which such Borrower or such ERISA
Affiliate proposes to take with respect thereto;
(l) promptly and in any event within ten (10) days after receipt
thereof by any of the Borrowers or any of their ERISA Affiliates from the PBGC
copies of each notice received by such Borrower or any such ERISA Affiliate of
the PBGC's intention to terminate any Single Employer Plan of such Borrower or
such ERISA Affiliate or to have a trustee appointed to administer any such Plan;
(m) if requested by the Administrative Agent, promptly and in any
event within thirty (30) days after the filing thereof with the Internal Revenue
Service, copies of each Schedule B (Actuarial Information) to the annual report
(Form 5500 Series) with respect to each Single Employer Plan of any of the
Borrowers or any of their ERISA Affiliates;
(n) within ten (10) days after notice is given or required to be given
to the PBGC under Section 302(f)(4)(A) of ERISA of the failure of any of the
Borrowers or any of their ERISA Affiliates to make timely payments to a Plan, a
copy of any such notice filed and a statement of a Financial Officer of such
Borrower setting forth (A) sufficient information necessary to determine the
amount of the Lien under Section 302(f)(3), (B) the reason for the failure to
make the required payments and (C) the action, if any, which the Borrowers or
any of their ERISA Affiliates proposed to take with respect thereto;
54
(o) promptly and in any event within ten (10) days after receipt
thereof by any of the Borrowers or any ERISA Affiliate from a Multiemployer Plan
sponsor, a copy of each notice received by such Borrower or any ERISA Affiliate
concerning (A) the imposition of Withdrawal Liability by a Multiemployer Plan,
(B) the determination that a Multiemployer Plan is, or is expected to be, in
reorganization within the meaning of Title IV of ERISA, (C) the termination of a
Multiemployer Plan within the meaning of Title IV of ERISA, or (D) the amount of
liability incurred, or which may be incurred, by the Borrowers or any ERISA
Affiliate in connection with any event described in clause (A), (B) or (C)
above;
(p) as soon as available, the Borrowers' consolidated balance sheets
and related statements of income; stockholders' equity and cash flows, showing
the financial condition of the Borrowers and their respective Subsidiaries on a
consolidated basis as of the close of the fiscal year ending on May 29, 2004 and
the fiscal quarter ending August 21, 2004 and each subsequent fiscal quarter and
fiscal year of the Borrowers ending on or prior to the date of entry of the
Amendment Order by the Bankruptcy Court, in each case, certified by a Financial
Officer of each of the Borrowers as fairly presenting the financial condition
and results of operations of the Borrowers and their respective Subsidiaries on
a consolidated basis in accordance with GAAP, subject, in the case of the
interim financial statements, to normal year-end audit adjustments;
(q) promptly, from time to time, such other information (including,
without limitation, projections) regarding the operations, business affairs and
financial condition of any Borrower, or compliance with the terms of any
material loan or financing agreements as the Administrative Agent, at the
request of any Lender, may reasonably request;
(r) promptly after the same is available, copies of all pleadings,
motions, applications, judicial information, financial information and other
documents filed by or on behalf of any of the Borrowers with the Bankruptcy
Court in the Cases, providing copies of same to counsel for the Administrative
Agent; and
(s) as soon as possible, and in any event no later than July 1, 2007,
a strategic business plan in form and substance reasonably satisfactory to the
Administrative Agent and Chilmark Partners LLC or such other third party
financial advisor acceptable to the Administrative Agent.
SECTION 5.2 Existence. The Borrowers will preserve and maintain in full
force and effect all governmental rights, privileges, qualifications, permits,
licenses and franchises necessary or desirable in the normal conduct of its
businesses except (i) (A) if in the reasonable business judgment of such
Borrower it is in its best economic interest not to preserve and maintain such
rights, privileges, qualifications, permits, licenses and franchises, and (B)
such failure to preserve the same could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect, and (ii) as otherwise permitted in
connection with sales of assets permitted by Section 6.11.
SECTION 5.3 Insurance. The Borrowers will: (a) keep their insurable
properties insured at all times, against such risks, including fire and other
risks insured against by extended coverage, as is customary with companies of
the same or similar size in the same or similar
55
businesses; and maintain in full force and effect public liability insurance
against claims for personal injury or death or property damage occurring upon,
in, about or in connection with the use of any properties owned, occupied or
controlled by any Borrower in such amounts and with such deductibles as are
customary with companies of the same or similar size in the same or similar
businesses and in the same geographic area, with financially sound and
responsible insurance companies; and (b) maintain such other insurance or self
insurance as may be required by law, with financially sound and responsible
insurance companies.
SECTION 5.4 Obligations and Taxes. Each Borrower will pay all its
material obligations arising after the Filing Date promptly and in accordance
with their terms and pay and discharge promptly all material taxes,
assessments and governmental charges or levies imposed upon it or upon its
income or profits or in respect of its property arising after the Filing Date,
before the same shall become in default, as well as all material lawful claims
for labor, materials and supplies or otherwise arising after the Filing Date
which, if unpaid, would become a Lien or charge upon such properties or any
part thereof; provided, however, that no Borrower shall be required to pay and
discharge or to cause to be paid and discharged any such tax, assessment,
charge, levy or claim so long as the validity or amount thereof shall be
contested in good faith by appropriate proceedings (if the Borrowers shall
have set aside on their books adequate reserves therefor).
SECTION 5.5 Notice of Event of Default, etc. The Borrowers will promptly
give to the Administrative Agent notice in writing of:
(a) any Default or Event of Default; and
(b) any litigation, proceedings or material investigations which may
exist at any time between any Borrower and any Governmental Authority.
SECTION 5.6 Access to Books and Records.
(a) The Borrowers and the Subsidiaries will maintain or cause to be
maintained at all times true and complete books and records in accordance with
GAAP of the financial operations of the Borrowers and their respective
Subsidiaries; and provide the Administrative Agent and its representatives
access to all such books and records during regular business hours, in order
that the Administrative Agent may examine and make abstracts from such books,
accounts, records and other papers for the purpose of verifying the accuracy of
the various reports delivered by the Borrowers to the Administrative Agent or
the Lenders pursuant to this Agreement or for otherwise ascertaining compliance
with this Agreement. The Borrowers will permit (and will cause their
Subsidiaries to permit) any representatives designated by the Administrative
Agent to discuss its affairs, finances and condition with its officers and
independent accountants, all at such reasonable times and as often as reasonably
requested.
(b) The Borrowers will permit any representatives designated by the
Administrative Agent (including any consultants, accountants, lawyers and
appraisers retained by the Administrative Agent) to conduct evaluations and
appraisals of the Borrowers' computation of the Borrowing Base and the assets
included in the Borrowing Base and such other assets and properties of the
Borrowers or their Subsidiaries as the Administrative Agent or
56
Required Lenders may require, all at such reasonable times and as often as
reasonably requested. The Borrowers shall pay the reasonable fees (including
reasonable and customary internally allocated fees of employees of the
Administrative Agent as to which invoices have been furnished) and expenses of
any such representatives retained by the Administrative Agent as to which
invoices have been furnished to conduct any such evaluation or appraisal,
including the reasonable fees and expenses associated with collateral monitoring
services performed by the IB ABL Portfolio Management Group of the
Administrative Agent. To the extent required by the Administrative Agent as a
result of any such evaluation, appraisal or monitoring, the Borrowers also agree
to modify or adjust the computation of the Borrowing Base (which may include
maintaining additional reserves, modifying the advance rates or modifying the
eligibility criteria for the components of the Borrowing Base).
(c) In the event that historical accounting practices, systems or
reserves relating to the components of the Borrowing Base are modified in a
manner that is adverse to the Lenders in any material respect, the Borrowers
will agree to maintain such additional reserves (for purposes of computing the
Borrowing Base) in respect to the components of the Borrowing Base and make such
other adjustments to its parameters for including the components of the
Borrowing Base as the Administrative Agent shall reasonably require based upon
such modifications.
(d) The Borrowers will grant the Administrative Agent and the
Collateral Agent access to and the right to inspect all reports, audits and
other internal information of the Borrowers relating to environmental matters
upon reasonable notice, and obtain any third party verification of matters
relating to compliance with environmental laws and regulations requested by the
Administrative Agent at any time and from time to time.
SECTION 5.7 Maintenance of Concentration Account. Within thirty (30) days
after the Closing Date, and at all times thereafter, the Borrowers will
maintain with the Administrative Agent an account or accounts to be used by
the Borrowers as their principal domestic concentration or sweep account(s)
into which shall be deposited the available balances from the Borrowers'
operating accounts at the end of each Business Day, net of disbursements paid
in the ordinary course of business during such Business Day.
SECTION 5.8 Borrowing Base Certificate. Commencing upon the end of the
Interim Period, furnish to the Administrative Agent, no later than (i) seven
(7) days after each of the weeks ended, a completed Borrowing Base Certificate
as of the last day of the immediately preceding one week period, (ii) twenty
(20) days following the immediately preceding fiscal month ended, a completed
Borrowing Base Certificate showing the Borrowing Base as of the close of
business on the last day of such fiscal month, and (iii) if requested by the
Administrative Agent, at any other time when the Administrative Agent
reasonably believes that the then existing Borrowing Base Certificate is
materially inaccurate, as soon as reasonably available but in no event later
than five (5) Business Days after such request, a completed Borrowing Base
Certificate showing the Borrowing Base as of the date so requested, in each
case with supporting documentation and additional reports with respect to the
Borrowing Base as the Administrative Agent may reasonably request. The Real
Property Component of the Borrowing Base shall be updated (i) from time to
time upon receipt of periodic valuation updates received from the
Administrative Agent's asset valuation experts, (ii) concurrent with the sale
of any assets
57
constituting part of the Real Property Component, (iii) in the event such assets
are idled for any reason other than routine maintenance or repairs for a period
in excess of ten (10) consecutive days, (iv) the value of such assets is
otherwise impaired, in the Administrative Agent's exclusive discretion, or (v)
following any of the events described in clauses (ii) or (iii) above, concurrent
with any agreement by the Administrative Agent (in the Administrative Agent's
discretion) to permit the Borrowers to add other property, plant or equipment to
the Real Property Component following receipt of appraisals of such assets which
are satisfactory to the Administrative Agent. The components of the Borrowing
Base consisting of Inventory shall be updated monthly as of the close of
business on the last day of each fiscal month of the Borrowers.
SECTION 5.9 Compliance with Laws. Comply with requirements of all
applicable laws, rules, regulations and orders of any Governmental Authority
(including all Pure Food and Drug Laws), except to the extent that failure to
comply herewith could not, in the aggregate, have a Material Adverse Effect
(other than any non-compliance solely with respect to the ABA Pension Plan).
SECTION 5.10 Environmental Laws
(a) Exercise all due diligence in order to comply and cause (i) all
tenants under any leases or occupancy agreements affecting any portion of the
Facilities and (ii) all other Persons on or occupying such property, to comply
with all Environmental Laws.
(b) (i) Promptly take any and all necessary remedial action in
connection with the presence, storage, use, disposal, transportation or release
of any Hazardous Waste or Hazardous Substance on or under any Facility required
to comply with all applicable Environmental Laws and Governmental Authorizations
unless the failure to so comply could not reasonably be expected to have a
Material Adverse Effect and (ii) in the event the Borrowers take any remedial
action with respect to any Hazardous Waste or Hazardous Substance on or under
any Facility, conduct and complete such remedial action in material compliance
with all applicable Environmental Laws and in accordance with the policies,
orders and directives of any applicable Governmental Authorities except when,
and only to the extent that, the Borrowers' liability for such presence,
storage, use, disposal, transportation or release of any such Hazardous Waste or
Hazardous Substance is being contested in good faith by the Borrowers.
SECTION 5.11 CEO. Continue to retain a chief executive officer of the
Parent Borrower who shall be reasonably satisfactory to the Administrative
Agent.
SECTION 6. NEGATIVE COVENANTS
From the date hereof and for so long as any Commitment shall be in effect
or any Letter of Credit shall remain outstanding (in a face amount in excess of
the amount of cash then held in the Letter of Credit Account, or in excess of
the face amount of back-to-back letters of credit delivered, in each case
pursuant to Section 2.3(b)) or any amount shall remain outstanding or unpaid
under this Agreement, unless the Required Lenders shall otherwise consent in
writing:
SECTION 6.1 Liens. Each of the Borrowers will not (and will not apply to
the Bankruptcy Court for authority to), incur, create, assume or suffer to
exist any Lien or
58
encumbrance on any asset of the Borrowers now owned or hereafter acquired by any
Borrower other than Permitted Liens.
SECTION 6.2 Merger, etc. Each of the Borrowers will not (and will not
apply to the Bankruptcy Court for authority to), consolidate or merge with or
into another Person.
SECTION 6.3 Indebtedness. Each of the Borrowers will not (and will not
apply to the Bankruptcy Court for authority to), contract, create, incur,
assume or suffer to exist any Indebtedness, except for (i) Indebtedness under
this Agreement; (ii) Indebtedness incurred prior to the Filing Date (including
existing Capitalized Leases) of the Borrowers, including the Indebtedness
listed on Schedule 6.3; (iii) Indebtedness incurred subsequent to the Filing
Date secured by purchase money Liens (exclusive of Capitalized Leases) in an
aggregate amount not in excess of $1,000,000 to the extent permitted by
Section 6.4; (iv) Indebtedness allowed under Sections 6.6 and 6.10 (without
duplication); (v) Indebtedness owed to (x) JPMCB or any of its banking
affiliates or (y) during the period commencing on the date hereof and ending
on the earlier of (A) the Prepayment Date or (B) the date on which the Final
Order is entered, and thereafter with respect to Indebtedness owed to Bank of
America, N.A., as long as Bank of America, N.A. is a Lender, and with respect
to Indebtedness owed to United Missouri Bank, as long as United Missouri Bank
is a Lender, or any of their respective banking Affiliates, in respect of any
overdrafts and related liabilities arising from treasury, depository and cash
management services or in connection with any automated clearing house
transfers of funds; (vi) other secured or unsecured Indebtedness incurred
subsequent to the Filing Date in an aggregate amount not to exceed $1,000,000;
and (vii) obligations allowed under Section 6.15 of this Agreement.
SECTION 6.4 Capital Expenditures. Each of the Borrowers will not (and will
not apply to the Bankruptcy Court for authority to), and will cause each of
their respective Subsidiaries not to, make Capital Expenditures during the
fiscal quarters of the Borrowers set forth below, in an aggregate amount in
excess of the amount specified opposite such fiscal quarters; provided that if
the amount of Capital Expenditures that are made during any such fiscal quarter
is less than the amount thereof that is permitted to be made during such fiscal
quarter, the unused portion thereof may be carried forward to and made during
the subsequent fiscal quarters:
Maximum Capital Expenditures
Fiscal Quarter Ending (millions)
--------------------- ----------
August 26, 2006 $16.00
November 18, 2006 $15.50
March 10, 2007 $11.50
June 2, 2007 $ 8.50
August 25, 2007 $13.50
November 17, 2007 $16.00
February 9, 2008 $16.50
SECTION 6.5 EBITDA. As of the end of each fiscal period of the Borrowers,
commencing with the fiscal monthly period ending December 16, 2006, the
Borrowers will not permit cumulative Consolidated EBITDA for the period
commencing on June 4, 2006 (being the
59
first day of the 2007 fiscal year of the Borrowers) and ending in each case on
the last day of the fiscal period listed below to be less than the respective
amounts specified opposite such fiscal period:
Cumulative Consolidated EBITDA
Fiscal Period Ending (millions)
-------------------- ----------
December 16, 2006 6.5
January 13, 2007 -7.0
February 10, 2007 -10.0
March 10, 2007 -14.0
April 7, 2007 -12.0
May 5, 2007 -7.0
June 2, 2007 1.5
June 30, 2007 13.5
July 28, 2007 18.0
August 25, 2007 29.0
September 22, 2007 37.5
October 20, 2007 43.0
November 17, 2007 45.0
December 15, 2007 43.0
January 12, 2008 34.0
February 9, 2008 38.0
SECTION 6.6 Guarantees and Other Liabilities. Each of the Borrowers will
not (and will not apply to the Bankruptcy Court for authority to), purchase or
repurchase (or agree, contingently or otherwise, so to do) the Indebtedness
of, or assume, guarantee (directly or indirectly or by an instrument having
the effect of assuring another's payment or performance of any obligation or
capability of so doing, or otherwise), endorse or otherwise become liable,
directly or indirectly, for the obligations, stock or dividends of any Person,
except (i) for any guaranty of Indebtedness or other obligations (or otherwise
becoming liable for any of the obligations) of any of the Borrowers in the
ordinary course of business and consistent with the past business practices
with trade vendors if such Indebtedness or the obligations are permitted by
this Agreement, and (ii) by endorsement of negotiable instruments for deposit
or collection in the ordinary course of business.
SECTION 6.7 Chapter 11 Claims. Each of the Borrowers will not (and will
not apply to the Bankruptcy Court for authority to), incur, create, assume,
suffer to exist or permit any other Superpriority Claim which is pari passu
with or senior to the claims of the Administrative Agent and the Lenders
against the Borrowers hereunder, except for the Carve-Out.
SECTION 6.8 Dividends; Capital Stock. Each of the Borrowers will not (and
will not apply to the Bankruptcy Court for authority to), except for
distributions or payments from one Borrower to another Borrower, or from any
Subsidiaries to any Borrower, declare or pay, directly or indirectly, any
dividends or make any other distribution or payment, whether in cash,
property, securities or a combination thereof, with respect to (whether by
reduction of capital or
60
otherwise) any shares of capital stock (or any options, warrants, rights or
other equity securities or agreements relating to any capital stock), or set
apart any sum for the aforesaid purposes on anything other than an arm's-length
basis.
SECTION 6.9 Transactions with Affiliates. Each of the Borrowers will not
(and will not apply to the Bankruptcy Court for authority to), sell or
transfer any property or assets to, or otherwise engage in or permit to exist
any other material transactions with, any of its non-Borrower Affiliates other
than (i) in the ordinary course of the Borrowers' businesses in good faith and
at commercially reasonable prices and on commercially reasonable terms and
conditions not less favorable to the Borrowers than could be obtained on an
arm's-length basis from a non-Affiliate, and (ii) transactions described on
Schedule 6.9.
SECTION 6.10 Investments, Loans and Advances. Each of the Borrowers will
not (and will not apply to the Bankruptcy Court for authority to), purchase,
hold or acquire any capital stock, evidences of Indebtedness or other
securities of, make or permit to exist any loans or advances to, or make or
permit to exist any investment in, any other Person (all of the foregoing,
"Investments"), except for (i) Permitted Investments; (ii) Intercompany
Indebtedness owing from a Borrower to another Borrower incurred in the
ordinary course of business consistent with past practice; (iii) existing
Intercompany Indebtedness listed on Schedule 6.10 and (iv) Investments listed
on Schedule 6.10.
SECTION 6.11 Disposition of Assets. Each of the Borrowers will not (and
will not apply to the Bankruptcy Court for authority to), sell or otherwise
dispose of any assets (including, without limitation, the capital stock of any
Subsidiary of the Borrowers) except for (i) sales of Inventory, fixtures and
equipment in the ordinary course of business, and (ii) sales of surplus assets
of the Borrowers no longer used in the Borrowers' business operations.
SECTION 6.12 Nature of Business. Each of the Borrowers will not (and will
not apply to the Bankruptcy Court for authority to), modify or alter in any
material manner the nature and type of its business as conducted at or prior
to the Filing Date or the manner in which such business is conducted (except
as required by the Bankruptcy Code).
SECTION 6.13 Transactions among Borrowers. Each of the Borrowers will not
(and will not apply to the Bankruptcy Court for authority to), except to the
extent existing on the date the Cases were filed and disclosed on Schedule
6.13, permit, place or agree to permit or place any restrictions on the
payment of dividends or other distributions among the Borrowers or their
Subsidiaries or Affiliates or the making of advances or any other cash
payments among the Borrowers or their Subsidiaries or Affiliates.
SECTION 6.14 Right of Subrogation among Borrowers. Each of the Borrowers
will not (and will not apply to the Bankruptcy Court for authority to), assert
any right of subrogation against any other Borrower until all Borrowings and
all Letters of Credit are paid in full and the Total Commitment is terminated.
SECTION 6.15 Derivative Agreements. Other than exchange-traded futures
and option contracts designed to hedge against fluctuations in prices for
wheat, corn, oil, fuel and other commodities used in the Borrowers' business,
in each case entered into in the ordinary
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course of the Borrowers' business, consistent with past practices and not for
speculative purposes, and for which aggregate expenditures (including, but not
limited to, expenditures for brokerage commissions, exchange or clearing fees,
open trade equity, futures margins and options premiums) by the Borrowers during
any fiscal year shall not exceed $10,000,000, each of the Borrowers will not
(and will not apply to the Bankruptcy Court for authority to), enter into any
agreement with respect to any swap, forward, future or derivative transaction or
option or similar agreement involving, or settled by reference to, one or more
rates, currencies, commodities, equity or debt instruments or securities, or
economic, financial or pricing indices or measures of economic, financial or
pricing risk or value or any similar transaction or any combination of these
transactions.
SECTION 6.16 Reorganization Plan. The Borrowers will not (and will not
apply to the Bankruptcy Court for authority to), file any Reorganization Plan
that does not provide for the repayment in full in cash on the effective date
thereof of all outstanding Obligations.
SECTION 6.17 Cash Restructuring Charges. Each of the Borrowers will not
(and will not apply to the Bankruptcy Court for authority to), and will cause
each of their respective Subsidiaries not to, incur cash restructuring charges
for the fiscal period beginning December 17, 2006 and ending February 9, 2008
in an amount in excess of $10,000,000 (calculated as the amount expensed or
accrued by the Borrowers or any of their Subsidiaries during such period on
account of restructuring charges that will ultimately be settled via payment
in cash or cash equivalents by the Borrowers or any of their Subsidiaries.
SECTION 7. EVENTS OF DEFAULT
SECTION 7.1 Events of Default. In the case of the happening of any of the
following events and the continuance thereof beyond the applicable period of
grace (if any) set forth below (each, an "Event of Default"):
(a) any representation or warranty made by any Borrower in this
Agreement or in any Loan Document or in connection with this Agreement or the
credit extensions hereunder or any statement or representation made in any
report, financial statement, certificate or other document furnished by any
Borrower to the Lenders under or in connection with this Agreement, shall prove
to have been false or misleading in any material respect when made or delivered;
or
(b) default shall be made in the payment of any fees or interest on
the Loans, principal of the Loans or other amounts payable by the Borrowers
hereunder (including, without limitation, reimbursement obligations or cash
collateralization in respect of Letters of Credit), when and as the same shall
become due and payable, whether at the due date thereof or at a date fixed for
prepayment thereof or by acceleration thereof or otherwise; or
(c) default shall be made by any Borrower in the due observance or
performance of any covenants, conditions or agreements contained in Section 6
hereof; or
(d) default shall be made by any Borrower in the due observance or
performance of any covenant, condition or agreement (other than the covenants,
conditions or agreements contained in Section 6 hereof) to be observed or
performed pursuant to the terms of
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this Agreement or any of the other Loan Documents and such default shall
continue unremedied for more than ten (10) days; or
(e) any of the Cases shall be dismissed or converted to a case under
Chapter 7 of the Bankruptcy Code or any Borrower shall file a motion or other
pleading seeking the dismissal of any of the Cases under Section 1112 of the
Bankruptcy Code or otherwise; a trustee under Chapter 7 or Chapter 11 of the
Bankruptcy Code, a responsible officer or an examiner with enlarged powers
relating to the operation of the business (powers beyond those set forth in
Section 1106(a)(3) and (4) of the Bankruptcy Code) under Section 1106(b) of the
Bankruptcy Code shall be appointed in any of the Cases and the order appointing
such trustee, responsible officer or examiner shall not be reversed or vacated
within thirty-five (35) days after the entry thereof; an application shall be
filed by any Borrower for the approval of any other Superpriority Claim (other
than the Carve-Out) in any of the Cases which is pari passu with or senior to
the claims of the Administrative Agent and the Lenders against any Borrower
hereunder, or there shall arise or be granted any such pari passu or senior
Superpriority Claim; or the Bankruptcy Court shall enter an order terminating
the use of cash collateral for the purposes described in Section 3.10; or
(f) the Bankruptcy Court shall enter an order or orders granting
relief from the automatic stay applicable under Section 362 of the Bankruptcy
Code to the holder or holders of any security interest to permit foreclosure (or
the granting of a deed in lieu of foreclosure or the like) on any assets of any
of the Borrowers which have a value in excess of $1,000,000 in the aggregate; or
(g) a Change of Control shall occur; or
(h) from and after the expiration of the Interim Period, the Borrowers
shall fail to deliver a certified Borrowing Base Certificate when due and such
default shall continue unremedied for more than three (3) Business Days; or
(i) any provision of any Loan Document shall, for any reason, cease to
be valid and binding on any of the Borrowers, or any of the Borrowers shall so
assert in any pleading filed in any court; or
(j) an order of the Bankruptcy Court shall be entered reversing,
amending, supplementing, staying for a period in excess of ten (10) days,
vacating or otherwise modifying either of the Orders; or
(k) any judgment or order as to a post-petition liability or debt for
the payment of money in excess of $1,000,000 shall be rendered against any of
the Borrowers and the enforcement thereof shall not have been stayed (by
court-ordered stay or by consent of the party litigants), it being understood
that Federal Rule of Civil Procedure 62(a) provides for a ten-day stay of
enforcement of money judgments; or
(l) any non-monetary judgment or order with respect to a post-petition
event shall be rendered against any Borrower which does or would reasonably be
expected to (i) cause a material adverse change in the financial condition,
business, prospects, operations or assets of the Borrowers taken as a whole on a
consolidated basis, (ii) have a material adverse effect on the
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ability of any of the Borrowers to perform their respective obligations under
any Loan Document, or (iii) have a material adverse effect on the rights and
remedies of the Administrative Agent or any Lender under any Loan Document, and
there shall be any period of ten (10) consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or
(m) the Borrowers shall make any Pre-Petition Payment (whether by way
of adequate protection or otherwise) of principal or interest or otherwise on
account of any pre-petition Indebtedness or payables other than Pre-Petition
Payments authorized by the Bankruptcy Court in respect of: (i) accrued payroll
and related employee benefit expenses as of the Filing Date, (ii) reclamation
claims in such amounts as determined by the Borrowers and agreed to by the
Administrative Agent; (iii) materialmen's liens and certain other pre-petition
claims permitted by the Administrative Agent and authorized by the Bankruptcy
Court in an aggregate amount not to exceed $500,000, (iv) the payment of current
interest and letter of credit fees (and the payment of all interest and fees
that are accrued and unpaid as of the Filing Date) at the applicable non-default
rates provided for pursuant to the Pre-Petition Credit Agreement, all as
described in the Borrowers' Motion for Interim and Final Orders (I) Authorizing
Debtors to (A) Obtain Postpetition Financing pursuant to 11 U.S.C. xx.xx. 105,
361, 362, 363, 364(C)(1), 364(C)(2), 364(C)(3) and 364(d)(1), and (B) Utilize
Cash Collateral pursuant to 11 U.S.C. ss. 363, (II) Granting Adequate Protection
to Prepetition Secured Parties pursuant to 11 U.S.C. xx.xx. 361, 362 and 363 and
(III) Scheduling Final Hearing pursuant to Fed. R. Bankr. P. 4001(c), and as
authorized by the Orders, (v) payments in respect of prepetition claims of
taxing authorities in an aggregate amount not to exceed $3,000,000 as described
in the Borrowers' Motion for Order under 11 U.S.C. xx.xx. 363, 507 and 541
Confirming Authority to Pay Prepetition Sales and Use Taxes, (vi) payments in
respect of certain prepetition real property tax claims and other secured claims
that are accruing collectible postpetition interest in an aggregate amount not
to exceed $12,000,000 as described in Borrowers' Motion for an Order Granting
Authority to Compromise and Pay Certain Tax and Other Claims that are Accruing
Collectible Postpetition Interest and/or Penalties, and as authorized by the
Order Granting Authority to Compromise and Pay Certain Tax and Other Claims that
are Accruing Collectible Postpetition Interest and/or Penalties entered by the
Bankruptcy Court on October 4, 2005, (vii) payments in an amount not to exceed
$2,000,000 which are authorized to be made by that certain Order Pursuant to 11
U.S.C. xx.xx. 362 and 363 and Fed. R. Bankr. P. 9019 (A) Granting Relief From
Automatic Stay, (B) Approving the Debtor's Settlement Agreement with Xxxxxxxx
Xxxxxxxxxx, on behalf of Himself Individually, and as Representative of a Class
of Individuals Similarly Situated, and (C) Conditionally Allowing Claims
Pursuant to the Settlement Agreement, and (viii) payments in an amount not to
exceed $1,500,000 to the Central States Southwest Areas Health and Welfare Fund
and Southeast and Southwest Areas Pension Fund pursuant to any settlement of any
pre-petition claims of such funds as approved by the Bankruptcy Court; or
(n) any Termination Event (other than as a result of or solely with
respect to the ABA Pension Plan, to the extent the Insufficiency of the ABA
Pension Plan does not exceed $70,000,000) described in clauses (iii) or (iv) of
the definition of such term shall have occurred and shall continue unremedied
for more than ten (10) days and the sum (determined as of the date of occurrence
of such Termination Event) of the Insufficiency of the Plan in respect of which
such Termination Event shall have occurred and be continuing and the
Insufficiency of
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any and all other Plans with respect to which such a Termination Event
(described in such clauses (iii) or (iv)) shall have occurred and then exist is
equal to or greater than $1,000,000; or
(o) (i) any Borrower or any ERISA Affiliate thereof shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred Withdrawal
Liability to such Multiemployer Plan, (ii) such Borrower or such ERISA Affiliate
does not have reasonable grounds to contest such Withdrawal Liability and is not
in fact contesting such Withdrawal Liability in a timely and appropriate manner,
and (iii) the amount of such Withdrawal Liability specified in such notice, when
aggregated with all other amounts required to be paid to Multiemployer Plans in
connection with Withdrawal Liabilities (determined as of the date of such
notification), exceeds $5,000,000 allocable to post-petition obligations or
requires payments exceeding $1,000,000 per annum in excess of the annual
payments made with respect to such Multiemployer Plans by such Borrower or such
ERISA Affiliate for the plan year immediately preceding the plan year in which
such notification is received; or
(p) any Borrower or any ERISA Affiliate thereof shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is
in reorganization or is being terminated, within the meaning of Title IV of
ERISA, if as a result of such reorganization or termination the aggregate annual
contributions of such Borrower and its ERISA Affiliates to all Multiemployer
Plans that are then in reorganization or being terminated have been or will be
increased over the amounts contributed to such Multiemployer Plans for the plan
years that include the date hereof by an amount exceeding $5,000,000; or
(q) any Borrower or any ERISA Affiliate thereof shall have committed a
failure described in Section 302(f)(1) of ERISA (other than (i) the failure to
make any contribution accrued and unpaid as of the Filing Date and (ii) solely
as a result of or with respect to the ABA Pension Plan to the extent that any
special assessments for such accrued and unpaid contributions do not exceed
$38,000,000) and the amount determined under Section 302(f)(3) of ERISA is equal
to or greater than $1,000,000; or
(r) it shall be determined (whether by the Bankruptcy Court or by any
other judicial or administrative forum) that any Borrower is liable for the
payment of claims arising out of any failure to comply (or to have complied)
with applicable Environmental Laws the payment of which will have a Material
Adverse Effect and the enforcement thereof shall not have been stayed; or
then, and in every such event and at any time thereafter during the
continuance of such event, and without further order of or application to the
Bankruptcy Court, the Administrative Agent may, and at the request of the
Required Lenders, shall, take one or more of the following actions without
further order of or application to the Court, provided that with respect to
item (iv) below and the enforcement of liens or other remedies with respect to
collateral referred to in item (v) below, the Administrative Agent shall
provide the Borrowers (with a copy to counsel for the Official Creditors'
Committee appointed in any of the Cases and to the United States Trustee for
the Bankruptcy Court's District) with five (5) business days' prior written
notice (the "Default Notice"): (i) terminate forthwith the Total Commitment;
(ii) declare the Loans then outstanding to be forthwith due and payable,
whereupon the principal of the Loans together with accrued interest thereon
and any unpaid accrued Fees and all other liabilities of the Borrowers accrued
65
hereunder and under any other Loan Document, shall become forthwith due and
payable, without presentment, demand, protest or any other notice of any kind,
all of which are hereby expressly waived by the Borrowers, anything contained
herein or in any other Loan Document to the contrary notwithstanding; (iii)
require the Borrowers upon demand to forthwith deposit in the Letter of Credit
Account cash in an amount which, together with any amounts then held in the
Letter of Credit Account, is equal to the sum of 105% of the then Letter of
Credit Outstandings (and to the extent the Borrowers shall fail to furnish
such funds as demanded by the Administrative Agent, the Administrative Agent
shall be authorized to debit the accounts of the Borrowers maintained with the
Administrative Agent in such amount five (5) Business Days after the giving of
the notice referred to above (the "Default Notice Period")); (iv) set-off
amounts in the Letter of Credit Account or any other accounts maintained with
the Administrative Agent or any other Lender or their affiliates and apply
such amounts to the obligations of the Borrowers hereunder and in the other
Loan Documents; and/or (v) exercise any and all remedies (including, without
limitation, with respect to the Liens in favor of the Administrative Agent and
the Lenders) under the Loan Documents and under applicable law available to
the Administrative Agent and the Lenders.
SECTION 8. THE ADMINISTRATIVE AGENT
SECTION 8.1 Administration by Administrative Agent. The general
administration of the Loan Documents shall be performed by the Administrative
Agent. Each Lender hereby irrevocably authorizes the Administrative Agent, at
its discretion, to take or refrain from taking such actions as agent on its
behalf and to exercise or refrain from exercising such powers under the Loan
Documents as are delegated by the terms hereof or thereof, as appropriate,
together with all powers reasonably incidental thereto (including the release
of Collateral in connection with any transaction that is expressly permitted
by the Loan Documents). The Administrative Agent shall have no duties or
responsibilities except as set forth in this Agreement and the remaining Loan
Documents.
SECTION 8.2 Advances and Payments.
(a) On the date of each Loan, the Administrative Agent shall be
authorized (but not obligated) to advance, for the account of each of the
Lenders, the amount of the Loan to be made by it in accordance with its
Commitment hereunder. Should the Administrative Agent do so, each of the Lenders
agrees forthwith to reimburse the Administrative Agent in immediately available
funds for the amount so advanced on its behalf by the Administrative Agent,
together with interest at the Federal Funds Effective Rate if not so reimbursed
on the date due from and including such date but not including the date of
reimbursement.
(b) Any amounts received by the Administrative Agent in connection
with this Agreement (other than amounts to which the Administrative Agent is
entitled pursuant to Sections 2.19, 8.6, 9.5 and 9.6), the application of which
is not otherwise provided for in this Agreement, shall be applied, first, in
accordance with each Lender's Commitment Percentage to pay accrued but unpaid
Commitment Fees or Letter of Credit Fees, and second, in accordance with each
Lender's Commitment Percentage to pay accrued but unpaid interest and the
principal balance outstanding and all unreimbursed Letter of Credit drawings.
All amounts to be paid to a Lender by the Administrative Agent shall be credited
to that Lender, after collection by the
66
Administrative Agent, in immediately available funds either by wire transfer or
deposit in that Lender's correspondent account with the Administrative Agent, as
such Lender and the Administrative Agent shall from time to time agree.
SECTION 8.3 Sharing of Setoffs. Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim
against the Borrowers, including, but not limited to, a secured claim or other
security or interest arising from, or in lieu of, such secured claim and
received by such Lender under any applicable bankruptcy, insolvency or other
similar law, or otherwise, obtain payment in respect of its Loans as a result
of which the unpaid portion of its Loans is proportionately less than the
unpaid portion of the Loans of any other Lender (a) it shall promptly purchase
at par (and shall be deemed to have thereupon purchased) from such other
Lender a participation in the Loans of such other Lender, so that the
aggregate unpaid principal amount of each Lender's Loans and its participation
in Loans of the other Lenders shall be in the same proportion to the aggregate
unpaid principal amount of all Loans then outstanding as the principal amount
of its Loans prior to the obtaining of such payment was to the principal
amount of all Loans outstanding prior to the obtaining of such payment and (b)
such other adjustments shall be made from time to time as shall be equitable
to ensure that the Lenders share such payment pro-rata, provided that if any
such non-pro-rata payment is thereafter recovered or otherwise set aside such
purchase of participations shall be rescinded (without interest). Each of the
Borrowers expressly consents to the foregoing arrangements and agrees that any
Lender holding (or deemed to be holding) a participation in a Loan may
exercise any and all rights of banker's lien, setoff (in each case, subject to
the same notice requirements as pertain to clause (iv) of the remedial
provisions of Section 7.1) or counterclaim with respect to any and all moneys
owing by the Borrowers to such Lender as fully as if such Lender held a Note
and was the original obligee thereon, in the amount of such participation.
SECTION 8.4 Agreement of Required Lenders. Upon any occasion requiring or
permitting an approval, consent, waiver, election or other action on the part
of the Required Lenders, action shall be taken by the Administrative Agent for
and on behalf or for the benefit of all Lenders upon the direction of the
Required Lenders, and any such action shall be binding on all Lenders. No
amendment, modification, consent, or waiver shall be effective except in
accordance with the provisions of Section 9.10.
SECTION 8.5 Liability of Administrative Agent.
(a) The Administrative Agent, when acting on behalf of the Lenders,
may execute any of its respective duties under this Agreement by or through any
of its respective officers, agents, and employees, and neither the
Administrative Agent nor its directors, officers, agents, employees or
Affiliates shall be liable to the Lenders or any of them for any action taken or
omitted to be taken in good faith, or be responsible to the Lenders or to any of
them for the consequences of any oversight or error of judgment, or for any
loss, unless the same shall happen through its gross negligence or willful
misconduct. The Administrative Agent and its respective directors, officers,
agents, employees and Affiliates shall in no event be liable to the Lenders or
to any of them for any action taken or omitted to be taken by them pursuant to
instructions received by them from the Required Lenders or in reliance upon the
advice of counsel selected by it. Without limiting the foregoing, neither the
Administrative Agent, nor any of its respective directors, officers, employees,
agents or Affiliates shall be responsible to any Lender for the due
67
execution, validity, genuineness, effectiveness, sufficiency, or enforceability
of, or for any statement, warranty, or representation in, this Agreement, any
Loan Document or any related agreement, document or order, or shall be required
to ascertain or to make any inquiry concerning the performance or observance by
the Borrowers of any of the terms, conditions, covenants, or agreements of this
Agreement or any of the Loan Documents.
(b) Neither the Administrative Agent nor any of its respective
directors, officers, employees, agents or Affiliates shall have any
responsibility to the Borrowers on account of the failure or delay in
performance or breach by any Lender or by the Borrowers of any of their
obligations under this Agreement or any of the Loan Documents or in connection
herewith or therewith.
(c) The Administrative Agent, in its capacity as Administrative Agent
hereunder, shall be entitled to rely on any communication, instrument, or
document reasonably believed by such person to be genuine or correct and to have
been signed or sent by a person or persons believed by such person to be the
proper person or persons, and such person shall be entitled to rely on advice of
legal counsel, independent public accountants, and other professional advisers
and experts selected by such person.
SECTION 8.6 Reimbursement and Indemnification. Each Lender agrees (i) to
reimburse (x) the Administrative Agent for such Lender's Commitment Percentage
of any expenses and fees incurred for the benefit of the Lenders under this
Agreement and any of the Loan Documents, including, without limitation,
counsel fees and compensation of agents and employees paid for services
rendered on behalf of the Lenders, and any other expense incurred in
connection with the operations or enforcement thereof not reimbursed by the
Borrowers and (y) the Administrative Agent for such Lender's Commitment
Percentage of any expenses of the Administrative Agent incurred for the
benefit of the Lenders that the Borrowers have agreed to reimburse pursuant to
Section 9.5 and has failed to so reimburse and (ii) to indemnify and hold
harmless the Administrative Agent and any of its directors, officers,
employees, agents or Affiliates, on demand, in the amount of its proportionate
share, from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses, or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by, or asserted
against it or any of them in any way relating to or arising out of this
Agreement or any of the Loan Documents or any action taken or omitted by it or
any of them under this Agreement or any of the Loan Documents to the extent
not reimbursed by the Borrowers (except such as shall result from their
respective gross negligence or willful misconduct).
SECTION 8.7 Rights of Administrative Agent. It is understood and agreed
that JPMCB shall have the same rights and powers hereunder (including the
right to give such instructions) as the other Lenders and may exercise such
rights and powers, as well as its rights and powers under other agreements and
instruments to which it is or may be party, and engage in other transactions
with any Borrower, as though it were not the Administrative Agent of the
Lenders under this Agreement.
SECTION 8.8 Independent Lenders. Each Lender acknowledges that it has
decided to enter into this Agreement and to make the Loans hereunder based on
its own analysis
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of the transactions contemplated hereby and of the creditworthiness of the
Borrowers and agrees that the Administrative Agent shall bear no responsibility
therefor.
SECTION 8.9 Notice of Transfer. The Administrative Agent may deem and
treat a Lender party to this Agreement as the owner of such Lender's portion
of the Loans for all purposes, unless and until a written notice of the
assignment or transfer thereof executed by such Lender shall have been
received by the Administrative Agent.
SECTION 8.10 Successor Administrative Agent. The Administrative Agent may
resign at any time by giving written notice thereof to the Lenders and the
Borrowers. Upon any such resignation, the Required Lenders shall have the
right to appoint a successor Administrative Agent, which shall be reasonably
satisfactory to the Borrowers. If no successor Administrative Agent shall have
been so appointed by the Required Lenders and shall have accepted such
appointment, within thirty (30) days after the retiring Administrative Agent's
giving of notice of resignation, the retiring Administrative Agent may, on
behalf of the Lenders, appoint a successor Administrative Agent, which shall
be a commercial bank organized under the laws of the United States of America
or of any State thereof and having a combined capital and surplus of a least
$100,000,000, which shall be reasonably satisfactory to the Borrowers. Upon
the acceptance of any appointment as Administrative Agent hereunder by a
successor Administrative Agent, such successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations under
this Agreement. After any retiring Administrative Agent's resignation
hereunder as Administrative Agent, the provisions of this Section 8 shall
inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement.
SECTION 9. MISCELLANEOUS
SECTION 9.1 Notices. (a) Except in the case of notices and other
communications expressly permitted to be given by telephone (and subject to
paragraph (b) below), all notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by telecopy, as
follows:
(i) if to the Borrowers, at Interstate Bakeries Corporation, 00
Xxxx Xxxxxx Xxxxxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000, Attention of Chief
Financial Officer (Telecopy No. 816-502-4232) and General Counsel
(Telecopy No. 816-502-4138);
(ii) if to the Administrative Agent, to JPMorgan Chase Bank, Loan
and Agency Services Group, 0000 Xxxxxx, 0xx Xxxxx, Xxxxxxx, Xxxxx
00000, Attention of Xxxxx Xxxx (Telecopy No. 713-750-2599) and Rose
Comely (Telecopy No. 713-750-2736), with a copy to JPMorgan Chase
Bank, 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention of Xxxxxxxxx
Xxxxxx (Telecopy No. 212-270-0467);
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(iii) if to JPMCB, as Fronting Bank, to it at JPMorgan Chase
Bank, Loan and Agency Services Group, 0000 Xxxxxx, 0xx Xxxxx, Xxxxxxx,
Xxxxx 00000, Attention of Xxxxx Xxxx (Telecopy No. 713-750-2599) and
Rose Comely (Telecopy No. 713-750-2736), with a copy to JPMorgan Chase
Bank, 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention of Xxxxxxxxx
Xxxxxx (Telecopy No. 212-270-0467); and
(iv) if to any Lender, to it at its address (or telecopy number)
set forth in its Administrative Questionnaire.
(b) Notices and other communications to the Lenders hereunder may be
delivered or furnished by electronic communications pursuant to procedures
approved by the Administrative Agent; provided that the foregoing shall not
apply to notices pursuant to Section 2 unless otherwise agreed by the
Administrative Agent and the applicable Lender. The Administrative Agent or the
Borrowers may, in their respective discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by them; provided that approval of such procedures may be
limited to particular notices or communications.
(c) Any party hereto may change its address or telecopy number for
notices and other communications hereunder by notice to the other parties
hereto. All notices and other communications given to any party hereto in
accordance with the provisions of this Agreement shall be deemed to have been
given on the date of receipt.
SECTION 9.2 Survival of Agreement, Representations and Warranties, etc.
All warranties, representations and covenants made by any Borrower herein or
in any certificate or other instrument delivered by it or on its behalf in
connection with this Agreement shall be considered to have been relied upon by
the Lenders and shall survive the making of the Loans herein contemplated
regardless of any investigation made by any Lender or on its behalf and shall
continue in full force and effect so long as any amount due or to become due
hereunder is outstanding and unpaid and so long as the Commitments have not
been terminated. All statements in any such certificate or other instrument
shall constitute representations and warranties by the Borrowers hereunder
with respect to the Borrowers.
SECTION 9.3 Successors and Assigns.
(a) This Agreement shall be binding upon and inure to the benefit of
the Borrowers, the Administrative Agent and the Lenders and their respective
successors and assigns. The Borrowers may neither assign nor transfer any of
their rights or obligations hereunder without the prior written consent of all
of the Lenders. Each Lender may sell participations to any Person in all or part
of any Loan, or all or part of its Commitment, in which event, without limiting
the foregoing, the provisions of Section 2.15 shall inure to the benefit of each
purchaser of a participation (provided that such participant shall look solely
to the seller of such participation for such benefits and the Borrowers'
liability, if any, under Sections 2.15 and 2.18 shall not be increased as a
result of the sale of any such participation) and the pro rata treatment of
payments, as described in Section 2.17, shall be determined as if such Lender
had not sold such participation. In the event any Lender shall sell any
participation, such Lender
70
shall retain the sole right and responsibility to enforce the obligations of
each of the Borrowers relating to the Loans, including, without limitation, the
right to approve any amendment, modification or waiver of any provision of this
Agreement (provided that such Lender may grant its participant the right to
consent to such Lender's execution of amendments, modifications or waivers which
(i) reduce any Fees payable hereunder to the Lenders, (ii) reduce the amount of
any scheduled principal payment on any Loan or reduce the principal amount of
any Loan or the rate of interest payable hereunder or (iii) extend the maturity
of the Borrowers' obligations hereunder). The sale of any such participation
shall not alter the rights and obligations of the Lender selling such
participation hereunder with respect to the Borrowers.
(b) Subject to the conditions set forth below, each Lender may assign
to one or more Lenders or Eligible Assignees all or a portion of its interests,
rights and obligations under this Agreement (including, without limitation, all
or a portion of its separate Commitments and the same portion of the related
Loans at the time owing to it), with the prior written consent (such consent not
to be unreasonably withheld) of: (A) the Administrative Agent, provided that no
consent of the Administrative Agent shall be required for an assignment of all
or any portion of the Loans to a Lender, an Affiliate of a Lender or an Approved
Fund; and (B) each Fronting Bank.
(c) Assignments shall be subject to the following additional
conditions:
(i) except in the case of an assignment to a Lender or an
Affiliate of a Lender or an assignment of the entire remaining amount
of the assigning Lender's Commitment or Loans of any Class, the amount
of the Commitment or Loans of the assigning Lender subject to each
such assignment (determined as of the date the Assignment and
Assumption with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $1,000,000 or the
remaining portion of such Lender's Commitment and/or Loans, if less,
unless the Administrative Agent otherwise consents; and
(ii) the parties to each such assignment shall execute and
deliver to the Administrative Agent, for its acceptance and recording
in the Register (as defined below), an Assignment and Acceptance with
blanks appropriately completed, together with a processing and
recordation fee of $3,500 (for which the Borrowers shall have no
liability). Upon such execution, delivery, acceptance and recording,
from and after the effective date specified in each Assignment and
Acceptance, which effective date shall be within ten (10) Business
Days after the execution thereof (unless otherwise agreed to in
writing by the Administrative Agent), (A) 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 Lender hereunder
and (B) the Lender thereunder shall, to the extent provided in such
Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering
all or the remaining portion of an assigning Lender's rights and
obligations under this Agreement, such Lender shall cease to be a
party hereto).
71
(d) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) 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, such Lender
assignor makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with this Agreement or any of the other Loan Documents or the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of this Agreement or any of the other Loan Documents; (ii) such Lender assignor
makes no representation or warranty and assumes no responsibility with respect
to the financial condition of the Borrowers or the performance or observance by
the Borrowers of any of its obligations under this Agreement or any of the other
Loan Documents or any other instrument or document furnished pursuant hereto;
(iii) such assignee confirms that it has received a copy of this Agreement and
the other Loan Documents, together with copies of the financial statements
referred to in Section 3.4 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; (iv) such assignee will, independently and
without reliance upon the Administrative Agent, such Lender assignor or any
other Lender 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 Agreement; (v) such assignee appoints and
authorizes the Administrative Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement as are delegated to the
Administrative Agent by the terms thereto, together with such powers as are
reasonably incidental hereof; and (vi) such assignee agrees that it will perform
in accordance with their terms all obligations that by the terms of this
Agreement are required to be performed by it as a Lender.
(e) The Administrative Agent shall maintain at its office a copy of
each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders and the Commitments of,
and principal amount of the Loans owing to, each Lender from time to time (the
"Register"). The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrowers, the Administrative Agent and the Lenders
shall treat each Person the name of which is recorded in the Register as a
Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrowers or any Lender at any reasonable time
and from time to time upon reasonable prior notice.
(f) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and the assignee thereunder together with the fee payable in
respect thereto, the Administrative Agent shall, if such Assignment and
Acceptance has been completed with blanks appropriately filled and consented to
by the Administrative Agent and the Fronting Bank (to the extent such consent is
required hereunder), (i) accept such Assignment and Acceptance, (ii) record the
information contained therein in the Register and (iii) give prompt written
notice thereof to the Borrowers (together with a copy thereof). No assignment
shall be effective for purposes of this Agreement unless it has been recorded in
the Register as provided in this paragraph.
(g) Any Lender may, in connection with any assignment or participation
or proposed assignment or participation pursuant to this Section 9.3, disclose
to the assignee or participant or proposed assignee or participant, any
information relating to the Borrowers
72
furnished to such Lender by or on behalf of any of the Borrowers; provided that
prior to any such disclosure, each such assignee or participant or proposed
assignee or participant shall agree in writing to be bound by the provisions of
Section 9.4.
(h) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this Section shall not apply to any pledge or
assignment of a security interest, provided that no such pledge or assignment of
a security interest shall release a Lender from any of its obligations hereunder
or substitute any such pledgee or assignee for such Lender as a party hereto.
SECTION 9.4 Confidentiality. Each Lender agrees to keep any information
delivered or made available by any of the Borrowers to it confidential from
anyone other than persons employed or retained by such Lender who are or are
expected to become engaged in evaluating, approving, structuring or
administering the Loans; provided that nothing herein shall prevent any Lender
from disclosing such information (i) to any of its Affiliates or to any other
Lender, provided such Affiliate agrees to keep such information confidential
to the same extent required by the Lenders hereunder, (ii) upon the order of
any court or administrative agency, (iii) upon the request or demand of any
regulatory agency or authority, (iv) which has been publicly disclosed other
than as a result of a disclosure by the Administrative Agent or any Lender
which is not permitted by this Agreement, (v) in connection with any
litigation to which the Administrative Agent, any Lender, or their respective
Affiliates may be a party to the extent reasonably required, (vi) to the
extent reasonably required in connection with the exercise of any remedy
hereunder, (vii) to such Lender's legal counsel and independent auditors, and
(viii) to any actual or proposed participant or assignee of all or part of its
rights hereunder subject to the proviso in Section 9.3(g). Each Lender shall
notify the Borrowers of any required disclosure under clause (ii) of this
Section; provided, however, that the failure of any such Lender to provide
such notification shall not limit, alter or otherwise affect any of the
Borrowers' obligations under this Agreement.
SECTION 9.5 Expenses. Whether or not the transactions hereby contemplated
shall be consummated, the Borrowers agree to pay all reasonable expenses
incurred by the Administrative Agent and X.X. Xxxxxx Securities Inc.
(including, without limitation, the reasonable fees and disbursements of Xxxxx
Xxxx LLP, counsel for the Administrative Agent, any other counsel that the
Administrative Agent shall retain and any internal or third-party appraisers,
consultants and auditors advising the Administrative Agent and X.X. Xxxxxx
Securities Inc. and their counsel) in connection with the preparation,
execution, delivery and administration of this Agreement and the other Loan
Documents, the making of the Loans and the issuance of the Letters of Credit,
the perfection of the Liens contemplated hereby, the syndication of the
transactions contemplated hereby, the costs, fees and expenses of the
Administrative Agent and X.X. Xxxxxx Securities Inc. in connection with the
initial and periodic collateral reviews and appraisals, field audits,
monitoring of assets (including collateral monitoring fees of or incurred by
the Administrative Agent) and publicity expenses, and, following the
occurrence of an Event of Default, all expenses incurred by the Lenders and
the Administrative Agent in the enforcement or protection of the rights of any
one or more of the Lenders or the Administrative Agent in connection with this
Agreement or the other Loan Documents, including but not limited to the fees
and disbursements of any counsel for the
73
Lenders or the Administrative Agent. Such payments by the Borrowers shall be
made upon delivery of a statement setting forth such costs and expenses. Whether
or not the transactions hereby contemplated shall be consummated, the Borrowers
agree to reimburse the Administrative Agent and X.X. Xxxxxx Securities Inc. for
the expenses set forth in the Commitment Letter and the reimbursement provisions
thereof are hereby incorporated herein by reference. The obligations of the
Borrowers under this Section shall survive the termination of this Agreement
and/or the payment of the Loans.
SECTION 9.6 Indemnity. Each of the Borrowers agree to indemnify and hold
harmless the Administrative Agent, X.X. Xxxxxx Securities Inc. and the Lenders
and their directors, officers, employees, trustees, advisors, agents and
Affiliates (each an "Indemnified Party") from and against any and all
expenses, losses, claims, damages and liabilities incurred by such Indemnified
Party arising out of claims made by any Person in any way relating to the
transactions contemplated hereby, but excluding therefrom all expenses,
losses, claims, damages, and liabilities to the extent that they are
determined by the final judgment of a court of competent jurisdiction to have
resulted from the gross negligence or willful misconduct of such Indemnified
Party. The obligations of the Borrowers under this Section shall survive the
termination of this Agreement and/or the payment of the Loans.
SECTION 9.7 Choice of Law. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
SHALL IN ALL RESPECTS BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK, APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED
WHOLLY WITHIN SUCH STATE AND THE BANKRUPTCY CODE.
SECTION 9.8 No Waiver. No failure on the part of the Administrative Agent
or any of the Lenders to exercise, and no delay in exercising, any right,
power or remedy hereunder or any of the other Loan Documents shall operate as
a waiver thereof, nor shall any single or partial exercise of any such right,
power or remedy preclude any other or further exercise thereof or the exercise
of any other right, power or remedy. All remedies hereunder are cumulative and
are not exclusive of any other remedies provided by law.
SECTION 9.9 Extension of Maturity. Should any payment of principal of or
interest or any other amount due hereunder become due and payable on a day
other than a Business Day, the maturity thereof shall be extended to the next
succeeding Business Day and, in the case of principal, interest shall be
payable thereon at the rate herein specified during such extension.
SECTION 9.10 Amendments, etc.
(a) No modification, amendment or waiver of any provision of this
Agreement or the Security and Pledge Agreement, and no consent to any departure
by the Borrowers therefrom, shall in any event be effective unless the same
shall be in writing and signed by the Required Lenders, and then such waiver or
consent shall be effective only in the specific instance and for the purpose for
which given; provided, however, that no such modification or amendment shall
without the written consent of the Lender affected thereby (x) increase the
Commitment of a Lender (it being understood that a waiver of an Event of
74
Default shall not constitute an increase in the Commitment of a Lender), or (y)
reduce the principal amount of any Loan (or any unreimbursed Letter of Credit)
or the rate of interest payable thereon, or extend any date for the payment of
interest, principal or fees hereunder or reduce any Fees payable hereunder or
extend the final maturity of the Borrowers' obligations hereunder; and,
provided, further, that no such modification or amendment shall without the
written consent of (A) all of the Lenders (i) amend or modify any provision of
this Agreement which provides for the unanimous consent or approval of the
Lenders, (ii) amend this Section 9.10 or the definition of Required Lenders,
(iii) amend or modify the Superpriority Claim status of the Lenders contemplated
by Section 2.23 or (B) the Super-Majority Lenders (i) release any material
portion of the Collateral from the Liens created under the Security and Pledge
Agreement (other than with respect to asset sales permitted under Section 6.11),
(ii) release any Borrower from its joint and several obligations under Section
2.7, (iii) alter the eligibility standards used in determining the Borrowing
Base in a manner which would increase the amount of the Borrowing Base, or (iv)
increase the advance rates in calculation of the Borrowing Base. No such
amendment or modification may adversely affect the rights and obligations of the
Administrative Agent or any Fronting Bank hereunder or any Lender in the
capacity referred to in Section 6.3(v) without its prior written consent. No
notice to or demand on any Borrower shall entitle any Borrower to any other or
further notice or demand in the same, similar or other circumstances. Each
assignee under Section 9.3(b) shall be bound by any amendment, modification,
waiver, or consent authorized as provided herein, and any consent by a Lender
shall bind any Person subsequently acquiring an interest on the Loans held by
such Lender. No amendment to this Agreement shall be effective against any
Borrower unless in writing and signed by such Borrower.
(b) Notwithstanding anything to the contrary contained in Section
9.10(a), in the event that any Borrower requests that this Agreement be modified
or amended in a manner which would require the unanimous consent of all of the
Lenders (or the consent described in clause (B) of the first sentence in Section
9.10(a)) and such modification or amendment is agreed to by the Super-majority
Lenders (as hereinafter defined), then with the consent of the Borrowers and the
Super-majority Lenders, the Borrowers and the Super-majority Lenders shall be
permitted to amend the Agreement without the consent of the Lender or Lenders
which did not agree to the modification or amendment requested by such Borrower
(such Lender or Lenders, collectively the "Minority Lenders") to provide for (w)
the termination of the Commitment of each of the Minority Lenders, (x) the
addition to this Agreement of one or more other financial institutions (each of
which shall be an Eligible Assignee), or an increase in the Commitment of one or
more of the Super-majority Lenders, so that the Total Commitment after giving
effect to such amendment shall be in the same amount as the Total Commitment
immediately before giving effect to such amendment, (y) if any Loans are
outstanding at the time of such amendment, the making of such additional Loans
by such new financial institutions or Super-majority Lender or Lenders, as the
case may be, as may be necessary to repay in full the outstanding Loans of the
Minority Lenders immediately before giving effect to such amendment and (z) such
other modifications to this Agreement as may be appropriate. As used herein, the
term "Super-majority Lenders" shall mean, at any time, Lenders including JPMCB
holding Loans representing at least 66-2/3% of the aggregate principal amount of
the Loans outstanding, or if no Loans are outstanding, Lenders having
Commitments representing at least 66-2/3% of the Total Commitment.
75
SECTION 9.11 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.
SECTION 9.12 Headings. Section headings used herein are for convenience
only and are not to affect the construction of or be taken into consideration
in interpreting this Agreement.
SECTION 9.13 Execution in Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall constitute an original, but
all of which taken together shall constitute one and the same instrument.
SECTION 9.14 Prior Agreements; Inconsistencies. This Agreement represents
the entire agreement of the parties with regard to the subject matter hereof
and the terms of any letters and other documentation entered into between any
Borrower and any Lender or the Administrative Agent prior to the execution of
this Agreement which relate to Loans to be made hereunder shall be replaced by
the terms of this Agreement (except as otherwise expressly provided herein
with respect to the Commitment Letter and the fee letter referred to therein,
including without limitation the Borrowers' agreement to actively assist the
Administrative Agent in the syndication of the transactions contemplated
hereby referred to in Section 9.3(g) and including also the provisions of
Section 2.19). In the event of any conflicts between the express provisions of
this Agreement and the Orders, the provisions of the Orders shall control to
the extent of any such inconsistency. In the event of any conflicts between
the express provisions of this Agreement and the Security Agreement, the
provisions of this Agreement shall control to the extent of any such
inconsistency.
SECTION 9.15 Further Assurances. Whenever and so often as reasonably
requested by the Administrative Agent, the Borrowers will promptly execute and
deliver or cause to be executed and delivered all such other and further
instruments, documents or assurances, and promptly do or cause to be done all
such other and further things as may be necessary and reasonably required in
order to further and more fully vest in the Administrative Agent all rights,
interests, powers, benefits, privileges and advantages conferred or intended
to be conferred by this Agreement and the other Loan Documents.
SECTION 9.16 Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED THEREBY.
SECTION 9.17 Subordination of Intercompany Indebtedness. Each of the
Borrowers agree that any and all Intercompany Indebtedness owed to any
Borrower shall be subordinate and subject in right of payment to the prior
payment, in full and in cash, of all Obligations. Notwithstanding any right of
any Borrower to ask, demand, xxx for, take or receive any payment in respect
of any Intercompany Indebtedness owed to any Borrower, any and all rights,
liens and security interests of any Borrower, whether now or hereafter arising
and
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howsoever existing, in any assets of any other Subsidiary of Parent (whether
constituting part of Collateral given to the Administrative Agent for the
benefit of the Lenders to secure payment of all or any part of the Obligations
or otherwise) shall be and are subordinated to the rights of the Administrative
Agent and the Lenders in those assets. No Borrower shall have any right to
possession of any such asset or to foreclose upon any such asset, whether by
judicial action or otherwise, unless and until all of the Obligations (other
than contingent indemnity obligations) shall have been fully paid and satisfied
and all financing arrangements among the Borrowers and the Lenders have been
terminated. So long as any Event of Default shall have occurred and be
continuing, then, any payment or distribution of any kind or character, either
in cash, securities or other property, which shall be payable or deliverable
upon or with respect to any Intercompany Indebtedness owed by any Borrower shall
be paid or delivered directly to the Administrative Agent for application on any
of the Obligations, due or to become due, until such Obligations (other than
contingent indemnity obligations) shall have first been fully paid and
satisfied. Each of the Borrowers irrevocably authorize and empower the
Administrative Agent to demand, xxx for, collect and receive every such payment
or distribution and give acquittance therefor and to make and present for and on
behalf of any Borrower such proofs of claim and take such other action, in the
Administrative Agent's own name or in the name of the applicable Borrower or
otherwise, as the Administrative Agent may deem necessary or advisable for the
enforcement of this Section 9.17. The Administrative Agent may vote such proofs
of claim in any such proceeding, receive and collect any and all dividends or
other payments or disbursements made thereon in whatever form the same may be
paid or issued and apply the same on account of any of the Obligations. Should
any payment, distribution, security or instrument or proceeds thereof be
received by any Borrower upon or with respect to the Intercompany Indebtedness
at any time an Event of Default shall have occurred and be continuing and prior
to the satisfaction of all of the Obligations and the termination of all
financing arrangements among the Borrowers and the Lenders, the applicable
Borrower shall receive and hold the same in trust, as trustee, for the benefit
of the Lenders and shall so long as any Event of Default shall have occurred and
be continuing promptly deliver the same to the Administrative Agent, for the
benefit of the Lenders, in precisely the form received (except for the
endorsement or assignment of the applicable Borrower where necessary), for
application to any of the Obligations, due or not due, and, until so delivered,
the same shall be held in trust by the applicable Borrower as the property of
the Lenders. If any Borrower fails to make any such endorsement or assignment to
the Administrative Agent, the Administrative Agent or any of its officers or
employees are irrevocably authorized to make the same. So long as any Event of
Default shall have occurred and be continuing, the Borrowers agree that until
the Obligations have been paid in full (in cash) and satisfied and all financing
arrangements among the Borrowers and the Lenders have been terminated, the
Borrowers will neither assign nor transfer to any Person (other than the
Administrative Agent) any claim the Borrowers have or may have against any other
Subsidiary of the Parent Borrower
SECTION 9.18 Certain Post Closing Matters.
(a) Notwithstanding anything to the contrary contained in this
Agreement, within the time periods set forth below or such later date(s) to
which the Administrative Agent shall, in its exclusive discretion, agree in
writing, the Borrowers shall deliver to the Administrative Agent:
77
(i) within thirty (30) days after the Closing Date, all Lien searches,
if any, which the Borrowers were required to deliver pursuant to Section
4.1(k) of this Agreement and delivery of which was temporarily waived by
the Lenders for the purposes of effecting the closing on the Closing Date;
(ii) within ninety (90) days after the Closing Date, mortgages in
favor of the Collateral Agent and in form and substance reasonably
satisfactory to the Administrative Agent on such Eligible Real Property of
the Borrowers as may then constitute all or any part of the Real Property
Component, together with such updated title commitments and related real
estate due diligence materials as the Administrative Agent may request in
accordance with the definition of Eligible Real Property;
(iii) upon the Administrative Agent's acceptance of the Budget, and in
any event no later than May 28, 2005, the Borrowers shall have executed and
delivered an amendment to this Agreement setting forth the financial
covenant levels for Sections 6.4 and 6.5 of this Agreement, which covenants
shall be satisfactory to the Administrative Agent;
(iv) within thirty (30) days after the Closing Date, all good standing
certificates, if any, which the Borrowers were required to deliver pursuant
to Section 4.1(a)(iv) of this Agreement and delivery of which was
temporarily waived by the Lenders for the purposes of effecting the closing
on the Closing Date; provided that one or more of the Borrowers may
identify to the Administrative Agent certain of the jurisdictions from
which they shall not have obtained good standing certificates as of the
Closing Date as jurisdictions in which the Borrower(s) do not conduct a
material amount of business and the Administrative Agent may thereafter
(but shall not be obligated to) waive delivery of a good standing
certificate for such jurisdiction(s);
(v) Schedules 1.1, 3.6, 3.12, 6.9, 6.10 and 6.13, which the Borrowers
were required to deliver pursuant to Section 1.1, 3.6, 3.12, 6.9, 6.10 and
6.13 of this Agreement, respectively, and delivery of which was temporarily
waived by the Lenders for the purposes of effecting the closing on the
Closing Date.
(b) Notwithstanding anything to the contrary contained in this
Agreement or the Security and Pledge Agreement, within thirty (30) days after
the Closing Date or such later date to which the Collateral Agent shall, in its
reasonable discretion, agree in writing, the Borrowers shall deliver to the
Collateral Agent:
(i) Schedules 1, 3, 4, 6, 7, and 8, which the Borrowers were required
to deliver pursuant to Section 4(a), 1(h), 1(i), 1(m), 1(n), and 1(o) of
the Security and Pledge Agreement, respectively, and delivery of which was
temporarily waived by the Lenders for the purposes of effecting the closing
on the Closing Date.
(c) All conditions precedent and representations contained in the Loan
Documents shall be deemed modified to the extent necessary to effect the
foregoing (and to permit the taking of the actions described above within the
time periods required above); provided, that to the extent any representation
and warranty would not be true because the
78
foregoing actions were not taken on the Closing Date, the respective
representation and warranty shall be required to be true and correct at the time
the respective action is taken in accordance with the foregoing provisions of
this Section 9.18. The acceptance of the benefits of the making of each Loan and
the issuance of each Letter of Credit shall constitute a representation,
warranty and covenant by the Borrowers to each of the Lenders that the actions
required pursuant to this Section 9.18 will be taken within the relevant time
periods referred to in this Section 9.18 and that, at such time, all
representations and warranties contained in this Agreement shall then be true
and correct without any modification pursuant to this Section 9.18.
SECTION 9.19 USA Patriot Act. Each Lender hereby notifies the Borrowers
that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L.
107-56 (signed into law October 26, 2001)) (the "Act"), it is required to
obtain, verify and record information that identifies the Borrowers, which
information includes the name and address of the Borrowers and other
information that will allow such Lender to identify the Borrower in accordance
with the Act.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and the year first written.
BORROWERS:
INTERSTATE BAKERIES CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
------------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Executive Vice President and
Chief Financial Officer
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627
Xxxxxx Xxxx, Xxxxxxxx 00000
FEIN: 00-0000000
ARMOUR AND MAIN REDEVELOPMENT CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
------------------------------------------
Title: Director
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627 Xxxxxx
Xxxx, Xxxxxxxx 00000
FEIN: 00-0000000
XXXXX'X INN QUALITY BAKED GOODS, LLC
By: /s/ Xxxxxx X. Xxxxxxxxx
------------------------------------------
Title: Director
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627 Xxxxxx
Xxxx, Xxxxxxxx 00000
FEIN:
IBC SALES CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
------------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Executive Vice President and
Chief Financial Officer
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627
Xxxxxx Xxxx, Xxxxxxxx 00000
FEIN: 00-0000000
IBC SERVICES, LLC
By: /s/ Xxxxxx X. Xxxxxxxxx
------------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: President
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627 Xxxxxx
Xxxx, Xxxxxxxx 00000
FEIN: 00-0000000
IBC TRUCKING, LLC
By: /s/ Xxxxxx X. Xxxxxxxxx
------------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: President
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627 Xxxxxx
Xxxx, Xxxxxxxx 00000
FEIN: 00-0000000
INTERSTATE BRANDS CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
------------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Executive Vice President and
Chief Financial Officer
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627
Xxxxxx Xxxx, Xxxxxxxx 00000
FEIN: 00-0000000
NEW ENGLAND BAKERY DISTRIBUTORS, L.L.C.
By: /s/ Xxxxxx X. Xxxxxxxxx
------------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Director
00 Xxxx Xxxxxx Xxxxxxxxx
P.O. Box 419627 Xxxxxx
Xxxx, Xxxxxxxx 00000
FEIN:
LENDERS:
JPMORGAN CHASE BANK,
Individually and as Administrative Agent
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Managing Director
