Exhibit 10.2
AMENDED AND RESTATED CREDIT AGREEMENT
(SUPPLEMENTAL CREDIT AGREEMENT)
among
CHATTEM, INC.,
as Borrower,
Domestic Subsidiaries of Borrower,
as Guarantors,
THE LENDERS IDENTIFIED HEREIN,
AND
NATIONSBANK OF TENNESSEE, N.A.,
as Agent
DATED AS OF MARCH 24, 1998
TABLE OF CONTENTS
SECTION 1 DEFINITIONS AND ACCOUNTING TERMS........................................2
1.1 Definitions...........................................................2
1.2 Computation of Time Periods and Other Definitional Provisions.........7
1.3 Accounting Terms......................................................8
SECTION 2 CREDIT FACILITIES......................................................8
2.1 Term Loans............................................................8
2.2 Continuations and Conversions........................................10
2.3 Minimum Amounts......................................................10
2.4 Notes................................................................11
SECTION 3 GENERAL PROVISIONS APPLICABLE TO LOANS.................................11
3.1 Interest.............................................................11
3.2 Place and Manner of Payments.........................................11
3.3 Prepayments..........................................................12
3.4 Fees.................................................................14
3.5 Payment in full at Maturity..........................................14
3.7 Pro Rata Treatment...................................................15
3.8 Allocation of Payments After Event of Default........................15
3.9 Sharing of Payments..................................................16
3.10 Capital Adequacy....................................................17
3.11 Inability To Determine Interest Rate................................17
3.12 Illegality..........................................................18
3.13 Requirements of Law.................................................18
3.14 Taxes...............................................................19
3.15 Indemnity...........................................................22
3.16 Replacement of Lenders..............................................22
SECTION 4 GUARANTY...............................................................23
4.1 Guaranty of Payment..................................................23
4.2 Obligations Unconditional............................................23
4.3 Modifications........................................................24
4.4 Waiver of Rights.....................................................24
4.5 Reinstatement........................................................25
4.6 Remedies.............................................................25
4.7 Limitation of Guaranty...............................................25
4.8 Rights of Contribution...............................................25
SECTION 5 CONDITIONS TO EXTENSIONS OF CREDIT.....................................26
5.1 Conditions to Extensions of Credit...................................26
SECTION 6 REPRESENTATIONS AND WARRANTIES.........................................27
6.1 Financial Condition..................................................27
6.2 No Material Change...................................................27
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6.3 Organization and Good Standing........................................27
6.4 Due Authorization.....................................................28
6.5 No Conflicts..........................................................28
6.6 Consents..............................................................28
6.7 Enforceable Obligations...............................................28
6.8 No Default............................................................28
6.9 Ownership.............................................................29
6.10 Indebtedness.........................................................29
6.11 Litigation...........................................................29
6.12 Taxes................................................................29
6.13 Compliance with Law..................................................29
6.14 ERISA................................................................29
6.15 Subsidiaries.........................................................30
6.16 Use of Proceeds; Margin Stock........................................31
6.17 Government Regulation................................................31
6.18 Environmental Matters................................................31
6.19 Intellectual Property................................................33
6.20 Solvency.............................................................33
6.21 Investments..........................................................33
6.22 No Financing of Corporate Takeovers..................................33
6.23 Location of Collateral...............................................33
6.24 Disclosure...........................................................33
6.25 Licenses, etc........................................................34
6.26 No Burdensome Restrictions...........................................34
6.27 Brokers' Fees........................................................34
6.28 Labor Matters........................................................34
6.29 Collateral Documents.................................................34
6.30 Related Transactions.................................................34
6.31 Representations and Warranties Incorporated from Purchase Agreement..35
6.32 Senior Debt..........................................................35
SECTION 7 AFFIRMATIVE COVENANTS...................................................35
7.1 Information Covenants.................................................35
7.2 Preservation of Existence and Franchises..............................39
7.3 Books and Records.....................................................39
7.4 Compliance with Law...................................................39
7.5 Payment of Taxes and Other Indebtedness...............................39
7.6 Insurance.............................................................39
7.7 Maintenance of Property...............................................40
7.8 Performance of Obligations............................................41
7.9 Collateral............................................................41
7.10 Use of Proceeds......................................................41
7.11 Audits/Inspections...................................................41
7.12 Financial Covenants..................................................41
7.13 Additional Credit Parties............................................43
7.14 Interest Rate Protection Agreements..................................43
7.15 Ownership of Subsidiaries............................................44
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7.16 Appraisal Reports....................................................44
7.17 Year 2000 Compatibility..............................................44
SECTION 8 NEGATIVE COVENANTS......................................................44
8.1 Indebtedness..........................................................44
8.2 Liens.................................................................45
8.3 Nature of Business....................................................45
8.4 Consolidation and Merger..............................................45
8.5 Sale or Lease of Assets...............................................46
8.6 Advances, Investments and Loans.......................................46
8.7 Dividends.............................................................46
8.8 Transactions with Affiliates..........................................46
8.9 Fiscal Year; Organizational Documents.................................47
8.10 Prepayments of Indebtedness..........................................47
8.11 Subordinated Debt....................................................47
8.12 Limitations..........................................................47
8.13 Sale Leasebacks......................................................48
8.14 Negative Pledges.....................................................48
8.15 Capital Expenditures.................................................48
8.16 Operating Leases.....................................................48
8.17 Payment Blockage Notice..............................................48
SECTION 9 EVENTS OF DEFAULT.......................................................49
9.1 Events of Default.....................................................49
9.2 Acceleration; Remedies................................................52
SECTION 10 AGENCY PROVISIONS......................................................53
10.1 Appointment..........................................................53
10.2 Delegation of Duties.................................................53
10.3 Exculpatory Provisions...............................................53
10.4 Reliance on Communications...........................................54
10.5 Notice of Default....................................................54
10.6 Non-Reliance on Agent and Other Lenders..............................55
10.7 Indemnification......................................................56
10.8 Agent in Its Individual Capacity.....................................56
10.9 Successor Agent......................................................56
SECTION 11 MISCELLANEOUS..........................................................57
11.1 Notices..............................................................57
11.2 Right of Set-Off.....................................................57
11.3 Benefit of Agreement.................................................58
11.4 No Waiver; Remedies Cumulative.......................................61
11.5 Payment of Expenses; Indemnification.................................61
11.6 Amendments, Waivers and Consents.....................................62
11.7 Counterparts.........................................................63
11.8 Headings.............................................................63
11.9 Defaulting Lender....................................................63
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11.10 Survival of Indemnification and Representations and Warranties.......63
11.11 Governing Law; Venue.................................................63
11.12 Waiver of Jury Trial.................................................64
11.13 Time.................................................................64
11.14 Severability.........................................................64
11.15 Entirety.............................................................64
11.16 Binding Effect.......................................................65
SCHEDULES
Schedule 1.1(a) Commitment Percentages
Schedule 1.1(b) Existing Permitted Investments
Schedule 6.10 Indebtedness
Schedule 6.11 Litigation
Schedule 6.14 ERISA Matters
Schedule 6.15 Subsidiaries
Schedule 6.18 Environmental Matters
Schedule 6.19 Intellectual Property
Schedule 6.23(a) Real Property Locations
Schedule 6.23(b) Personal Property Locations
Schedule 6.23(c) Chief Executive Offices
Schedule 7.6 Insurance
Schedule 8.2 Liens
Schedule 8.8 Affiliate Transactions
Schedule 11.1 Notices
EXHIBITS
Exhibit 2.2 Form of Notice of Continuation/Conversion
Exhibit 2.4(a) Form of Tranche A Term Loan Note
Exhibit 2.4(b) Form of Tranche B Term Loan Note
Exhibit 7.1(d) Form of Officer's Certificate
Exhibit 7.13 Form of Joinder Agreement
Exhibit 11.3 Form of Assignment Agreement
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AMENDED AND RESTATED CREDIT AGREEMENT
(SUPPLEMENTAL CREDIT FACILITY)
THIS AMENDED AND RESTATED CREDIT AGREEMENT (this "Credit Agreement"),
is entered into as of March 24, 1998 among CHATTEM, INC., a Tennessee
corporation (the "Borrower"), each of the Borrower's Domestic Subsidiaries,
individually a "Guarantor" and collectively the "Guarantors"), the Supplemental
Credit Lenders (as defined herein), and NATIONSBANK OF TENNESSEE, N.A., as agent
for the Supplemental Credit Lenders (in such capacity, the "Agent").
RECITALS
WHEREAS, the Borrower and the Guarantors are party to a Credit
Agreement (the "New Credit Agreement") dated as of the date hereof pursuant to
which NationsBank of Tennessee, N.A., as agent, and certain other lenders named
therein have agreed to provide a credit facility to the Borrower to replace and
refinance certain credit facilities provided to the Borrower pursuant to that
certain Credit Agreement dated as of June 26, 1997 (as amended or modified from
time to time, the "Prior New Credit Agreement"). The Prior New Credit Agreement
replaced and refinanced the credit facilities provided by the lenders pursuant
to that certain Credit Agreement dated as of April 26, 1996 (as amended or
modified from time to time, the "1996 New Credit Agreement"). The credit
facilities provided pursuant to the 1996 New Credit Agreement replaced and
refinanced the credit facilities provided to the Borrower by the First National
Bank of Chicago, as agent and certain other lenders under the credit agreements
dated as of June 17, 1994;
WHEREAS, that certain Indenture dated as of August 3, 1994 among the
Borrower, as issuer, Signal Investment & Management Co., as guarantor, and
SouthTrust Bank of Alabama, National Association, as trustee (as the same may be
modified, supplemented or amended from time to time, the "Indenture"), permits
the Borrower to incur additional indebtedness that will be considered Senior
Debt (as defined in the Indenture) upon the satisfaction of a financial test set
forth in the Indenture;
WHEREAS, the Borrower, the Guarantors, the lenders named therein and
NationsBank of Tennessee, N.A., as agent are currently parties to that certain
Credit Agreement dated as of June 26, 1997 (as amended or modified from time to
time, the "Prior Supplemental Credit Agreement");
WHEREAS, the Borrower and the Guarantors have requested that the
Supplemental Credit Lenders provide, in addition to the credit facilities
provided under the New Credit Agreement, an amended and restated credit facility
(the "Supplemental Credit Facility") to replace the credit facilities provided
pursuant to the Prior Supplemental Credit Agreement;
WHEREAS, the Supplemental Credit Lenders have agreed to make the
requested Supplemental Credit Facility available to the Borrower on the terms
and conditions hereinafter set forth, including without limitation evidence that
the additional indebtedness incurred hereunder will constitute Senior Debt (as
defined in the Indenture) upon the incurrence thereof.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 Definitions.
Unless otherwise defined herein, capitalized terms used herein shall
have the meanings ascribed to such terms in the New Credit Agreement. In
addition, the following terms shall have the following meanings:
"Additional Credit Party" means each Person that becomes a
Guarantor after the Closing Date, as provided in Section 7.13.
"Agent" means NationsBank of Tennessee, N.A. or any
successor administrative agent appointed pursuant to Section 10.9.
"Applicable Percentage" means:
(a) For Tranche A Term Loans, the appropriate applicable
percentages corresponding to the Leverage Ratio in effect as of the
most recent Calculation Date as shown below:
--------------------------------------------------------------------------
Applicable
Percentage Applicable
For Percentage For
Pricing Leverage Eurodollar Base Rate
Level Ratio Loans Loans
--------------------------------------------------------------------------
I Less than 4.0 to 1.0 2.25% 1.25%
--------------------------------------------------------------------------
II Greater than or equal
to 4.0 to 1.0 but less 2.50% 1.50%
than 4.5 to 1.0
--------------------------------------------------------------------------
III Greater than or equal
to 4.5 to 1.0 but less 2.75% 1.75%
than 5.0 to 1.0
--------------------------------------------------------------------------
IV Greater than or equal
to 5.0 to 1.0 3.00% 2.00%
--------------------------------------------------------------------------
(a) For Tranche B Term Loans, the appropriate applicable
percentages corresponding to the Leverage Ratio in effect as of the
most recent Calculation Date as shown below:
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-----------------------------------------------------------------------------------
Applicable
Percentage Applicable
For Percentage For
Pricing Leverage Eurodollar Base Rate
Level Ratio Loans Loans
-----------------------------------------------------------------------------------
I Less than 4.0 to 1.0 2.75% 1.75%
-----------------------------------------------------------------------------------
II Greater than or equal
to 4.0 to 1.0 but less 3.00% 2.00%
than 4.5 to 1.0
-----------------------------------------------------------------------------------
III Greater than or equal
to 4.5 to 1.0 but less 3.25% 2.25%
than 5.0 to 1.0
-----------------------------------------------------------------------------------
IV Greater than or equal
to 5.0 to 1.0 3.50% 2.50%
-----------------------------------------------------------------------------------
The Applicable Percentage for Tranche A Term Loans and Tranche B Terms
Loans shall, in each case, be determined and adjusted quarterly on the
date (each a "Calculation Date") five Business Days after the date by
which the Borrower is required to provide the officer's certificate in
accordance with the provisions of Section 7.1(d); provided, however
that (i) the initial Applicable Percentage for Tranche A Term Loans and
Tranche B Term Loans shall be based on Pricing Level II (as shown
above) and shall remain at Pricing Level II until the first Calculation
Date subsequent to the Closing Date and, thereafter, the Pricing Level
shall be determined by the then current Leverage Ratio, and (ii) if the
Borrower fails to provide the officer's certificate required by Section
7.1(d) on or before the most recent Calculation Date or fails to
deliver a copy of such officer's certificate to the Agency Services
Address as required by Section 7.1(d), the Applicable Percentage for
Tranche A Term Loans and Tranche B Term Loans from such Calculation
Date shall be based on Pricing Level IV until such time that an
appropriate officer's certificate is provided whereupon the Pricing
Level shall be determined by the then current Leverage Ratio. Each
Applicable Percentage shall be effective from one Calculation Date
until the next Calculation Date. Any adjustment in the Applicable
Percentage shall be applicable to all existing Tranche A Term Loans and
Tranche B Term Loans as well as any new Tranche A Term Loans and new
Tranche B Term Loans made or issued.
"Borrower" means the Person identified as such in the heading
hereof, together with any successors and permitted assigns.
"Calculation Date" has the meaning set forth in the definition
of Applicable Percentage.
"Closing Date" means the date hereof.
"Commitments" means the Revolving Committed Amount, the
Tranche A Term Loan Committed Amount and the Tranche B Term Loan
Committed Amount.
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"Credit Documents" means collectively, the Supplemental
Credit Documents and the New Credit Agreement Documents.
"Credit Party Obligations" means, without duplication, (a) all
of the obligations of the Credit Parties to the Supplemental Credit
Lenders and the Agent, whenever arising, under this Credit Agreement,
the Tranche A Term Loan Notes, the Tranche B Term Loan Notes, the
Collateral Documents or any of the other Supplemental Credit Documents
to which the Borrower or any other Credit Party is a party (including,
but not limited to, any interest accruing after the occurrence of a
Bankruptcy Event with respect to any Credit Party, regardless of
whether such interest is an allowed claim under the Bankruptcy Code)
and (b) all liabilities and obligations owing from a Credit Party to
any Supplemental Credit Lender, or any Affiliate of a Supplemental
Credit Lender, arising under interest rate protection agreements,
foreign currency exchange agreements, commodity purchase or option
agreements or other interest or exchange rate or commodity price
hedging agreements (collectively, the "Hedging Agreements").
"Default" means any event, act or condition which with notice
or lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" means, at any time, any Lender that, at
such time (a) has failed to make a Loan or purchase a Participation
Interest required pursuant to the terms of this Credit Agreement or the
New Credit Agreement (b) has failed to pay to the Agent or any Lender
an amount owned by such Lender pursuant to the terms of this Credit
Agreement or the New Credit Agreement or (c) has been deemed insolvent
or has become subject to a bankruptcy or insolvency proceeding or to a
receiver or similar official.
"Effective Date" means the date on which the conditions set
forth in Section 5.1 of the New Credit Agreement shall have been
fulfilled (or waived in the sole discretion of the Lenders) and on
which the initial Loans shall have been made.
"Event of Default" has the meaning specified in Section 9.1.
"Extension of Credit" means, as to any Lender, the making of a
Loan by such Lender (or a participation therein by a Lender).
"GAAP" means generally accepted accounting principles in the
United States applied on a consistent basis and subject to Section 1.3.
"Guarantor" means each of the Domestic Subsidiaries of the
Borrower and each Additional Credit Party which has executed a Joinder
Agreement, together with their successors and assigns.
"Hedging Agreements" has the meaning set forth in the
definition of Credit Party Obligations.
"Interest Payment Date" means (a) as to Base Rate Loans, the
last Business Day of each fiscal quarter of the Borrower and on the
Tranche A Term Loan Maturity Date or
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Tranche B Term Loan Maturity Date, as applicable, and (b) as to
Eurodollar Loans, on the last day of each applicable Interest Period
and on the Tranche A Term Loan Maturity Date or the Tranche B Term
Loan Maturity Date, as applicable.
"Interest Period" means as to Eurodollar Loans, a period of
one, two or three months' duration, as the Borrower may elect,
commencing, in each case, on the date of the borrowing (including
continuations and conversions thereof); provided, however, (a) if any
Interest Period would end on a day which is not a Business Day, such
Interest Period shall be extended to the next succeeding Business Day
(except that where the next succeeding Business Day falls in the next
succeeding calendar month, then on the next preceding Business Day),
(b) no Interest Period shall extend beyond the Tranche A Term Loan
Maturity Date or the Tranche B Term Loan Maturity Date, as applicable,
(c) with regard to Tranche A Term Loans and Tranche B Term Loans, as
applicable, no Interest Period shall extend beyond any Principal
Amortization Payment Date unless the portion of the Tranche A Term
Loans and Tranche B Term Loans, as applicable comprised of Base Rate
Loans together with the portion of the Tranche A Term Loans and Tranche
B Term Loans, as applicable comprised of Eurodollar Loans with Interest
Periods expiring prior to the date such Principal Amortization Payment
is due, is at least equal to the amount of such Principal Amortization
Payment due on such date and (d) where an Interest Period begins on a
day for which there is no numerically corresponding day in the calendar
month in which the Interest Period is to end, such Interest Period
shall end on the last Business Day of such calendar month.
"Joinder Agreement" means a Joinder Agreement substantially in
the form of Exhibit 7.13.
"Lender" means collectively, the Supplemental Credit
Lenders and the New Credit Agreement Lenders.
"Loan" or "Loans" means the Revolving Loans, the Swingline
Loans, the Tranche A Term Loans and/or the Tranche B Term Loans (or a
portion of any Revolving Loan, the Tranche A Term Loans and/or the
Tranche B Term Loans), individually or collectively, as appropriate.
"New Credit Agreement Documents" means the New Credit
Agreement, the Notes (other than the Tranche A Term Loan Notes and
Tranche B Term Loan Notes), the Collateral Documents, the Fee Letter
and all other related agreements and documents issued or delivered
hereunder or thereunder or pursuant hereto or thereto.
"New Credit Agreement Lenders" means any of the Persons
identified as a "New Credit Agreement Lender" on the signature pages to
the New Credit Agreement, and any Person which may become a New Credit
Agreement Lender by way of assignment in accordance with the terms of
the New Credit Agreement, together with their successors and permitted
assigns.
"Non-Excluded Taxes" has the meaning set forth in Section
3.14.
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"Note" or "Notes" means the Revolving Loan Notes, the
Swingline Note, the Tranche A Term Loan Notes and/or the Tranche B Term
Loan Notes, individually or collectively, as appropriate.
"Notice of Continuation/Conversion" means a request by the
Borrower to continue an existing Eurodollar Loan to a new Interest
Period or to convert a Eurodollar Loan to a Base Rate Loan or a Base
Rate Loan to a Eurodollar Loan, in the form of Exhibit 2.2.
"Participation Interest" means the Extension of Credit by a
Lender by way of the purchase of a participation in any Loans as
provided in Section 3.9.
"Principal Amortization Payment" means a principal payment on
the Tranche A Term Loans and Tranche B Terms Loans as set forth in
Section 2.1(c).
"Principal Amortization Payment Date" means the date a
Principal Amortization Payment is due.
"Required Lenders" means Lenders whose aggregate Credit
Exposure (as hereinafter defined) constitutes at least 67% of the
Credit Exposure of all Lenders at such time; provided, however, that if
any Lender shall be a Defaulting Lender at such time then there shall
be excluded from the determination of Required Lenders the aggregate
principal amount of Credit Exposure of such Lender at such time. For
purposes of the preceding sentence, the term "Credit Exposure" as
applied to each Lender shall mean (a) at any time prior to the
termination of the Commitments, the sum of (i) the Revolving Loan
Commitment Percentage of such Lender multiplied by the Revolving
Committed Amount, plus (ii) the Tranche A Term Loan Commitment
Percentage of such Lender multiplied by the aggregate principal amount
of Tranche A Term Loans outstanding at such time, plus (iii) the
Tranche B Term Loan Commitment Percentage of such Lender multiplied by
the aggregate principal amount of Tranche B Term Loans outstanding at
such time and (b) at any time after the termination of the Commitments,
the sum of the principal balance of the outstanding Loans of such
Lender.
"Supplemental Credit Documents" means this Credit Agreement,
the Tranche A Term Loan Notes, the Tranche B Term Loan Notes, any
Joinder Agreement, the Collateral Documents, the Fee Letter and all
other related agreements and documents issued or delivered hereunder or
thereunder.
"Supplemental Credit Lenders" means any of the Persons
identified as a "Supplemental Credit Lender" on the signature pages
hereto, and any Person which may become a Supplemental Credit Lender by
way of assignment in accordance with the terms hereof, together with
their successors and permitted assigns.
"Term Loans" means the Tranche A Term Loans and the Tranche B
Term Loans.
"Tranche A Term Loans" means the Tranche A Term Loans made
to the Borrower pursuant to Section 2.1 hereof.
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"Tranche A Term Loan Committed Amount" means TWENTY SEVEN
MILLION FIVE HUNDRED FORTY THOUSAND DOLLARS ($27,540,000).
"Tranche A Term Loan Commitment Percentage" means for a
Supplemental Credit Lender, the percentage identified as its Tranche A
Term Loan Commitment Percentage on Schedule 1.1(a) as such percentage
may be modified in connection with any assignment made in accordance
with the provisions of Section 11.3.
"Tranche A Term Loan Maturity Date" means June 26, 2002.
"Tranche A Term Loan Note" or "Tranche A Term Loan Notes"
means the promissory notes of the Borrower in favor of the Supplemental
Credit Lenders having a Tranche A Term Loan Commitment Percentage
evidencing the Term A Term Loans provided pursuant to Section 2.1,
individually or collectively, as appropriate, as such promissory notes
may be amended, modified, supplemented, extended, renewed or replaced
from time to time in the form of Exhibit 2.4(a).
"Tranche B Term Loans" means the Tranche B Term Loans made
to the Borrower pursuant to Section 2.1 hereof.
"Tranche B Term Loan Committed Amount" means THIRTY-FOUR
MILLION EIGHT HUNDRED TWENTY FIVE THOUSAND DOLLARS ($34,825,000).
"Tranche B Term Loan Commitment Percentage" means, for a
Supplemental Credit Lender, the percentage identified as its Tranche B
Term Loan Commitment Percentage on Schedule 1.1(a), as such percentage
may be modified in connection with any assignment made in accordance
with the provisions of Section 11.3.
"Tranche B Term Loan Maturity Date" means February 14, 2004.
"Tranche B Term Loan Note" or "Tranche B Term Loan Notes"
means the promissory notes of the Borrower in favor of the Supplemental
Credit Lenders having a Tranche B Term Loan Commitment Percentage
evidencing the Tranche B Term Loans provided pursuant to Section 2.1,
individually or collectively, as appropriate, as such promissory notes
may be amended, modified, supplemented, extended, renewed or replaced
from time to time as evidenced in the form of Exhibit 2.4(b).
1.2 Computation of Time Periods and Other Definitional Provisions.
For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding." References in this Credit Agreement to "Articles", "Sections",
"Schedules" or "Exhibits" shall be to Articles, Sections, Schedules or Exhibits
of or to this Credit Agreement unless otherwise specifically provided.
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1.3 Accounting Terms.
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Supplemental
Credit Lenders hereunder shall be prepared, in accordance with GAAP applied on a
consistent basis. All financial statements delivered to the Supplemental Credit
Lenders hereunder shall be accompanied by a statement from the Borrower that
GAAP has not changed since the most recent financial statements delivered by the
Borrower to the Supplemental Credit Lenders or if GAAP has changed describing
such changes in detail and explaining how such changes affect the financial
statements. All calculations made for the purposes of determining compliance
with this Credit Agreement shall (except as otherwise expressly provided herein)
be made by application of GAAP applied on a basis consistent with the most
recent annual or quarterly financial statements delivered pursuant to Section
7.1 (or, prior to the delivery of the first financial statements pursuant to
Section 7.1, consistent with the financial statements described in Section
5.1(c) of the New Credit Agreement); provided, however, if (a) the Borrower
shall object to determining such compliance on such basis at the time of
delivery of such financial statements due to any change in GAAP or the rules
promulgated with respect thereto or (b) either Agent or the Required Lenders
shall so object in writing within 60 days after delivery of such financial
statements (or after the Supplemental Credit Lenders have been informed of the
change in GAAP affecting such financial statements, if later), then such
calculations shall be made on a basis consistent with the most recent financial
statements delivered by the Borrower to the Supplemental Credit Lenders as to
which no such objection shall have been made.
SECTION 2
CREDIT FACILITIES
2.1 Term Loans.
(a) Tranche A Term Loans. Subject to the terms and conditions
set forth herein, each Supplemental Credit Lender that has a Tranche A
Term Loan Commitment Percentage severally agrees on the date hereof, to
make a term loan (collectively, the "Tranche A Term Loans") to the
Borrower, in Dollars, in an amount equal to such Supplemental Credit
Lender's Tranche A Term Loan Commitment Percentage of the Tranche A
Term Loan Committed Amount; provided that the aggregate amount of such
Tranche A Term Loans made on the date hereof shall not exceed the
Tranche A Term Loan Committed Amount. Once repaid, Tranche A Term Loans
cannot be reborrowed.
(b) Tranche B Term Loans. Subject to the terms and conditions
set forth herein, each Supplemental Credit Lender that has a Tranche B
Term Loan Commitment Percentage severally agrees on the date hereof, to
make a term loan (collectively, the "Tranche B Terms Loans") to the
Borrower, in Dollars, in an amount equal to such Supplemental Credit
Lender's Tranche B Term Loan Commitment Percentage of the Tranche B
Term Loan Committed Amount; provided that the aggregate amount of such
Tranche B Term Loans made on the date hereof shall not exceed the
Tranche B Term Loan Committed Amount.
Once repaid, Tranche B Term Loans cannot be reborrowed.
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(c) Funding of Term Loans. On the Effective Date, each
Supplemental Credit Lender will make its Tranche A Term Loan Commitment
Percentage of the Tranche A Term Loan Committed Amount and its Tranche
B Term Loan Commitment Percentage of the Tranche B Term Loan Committed
Amount available to the Agent by deposit, in Dollars and in immediately
available funds, at the offices of the Agent at its principal office in
Charlotte, North Carolina or at such other address as the Agent may
designate in writing. The amount of the Tranche A Term Loans and
Tranche B Term Loans will then be made available to the Borrower by the
Agent by crediting the account of the Borrower on the books of such
office of the Agent, to the extent the amount of such Tranche A Term
Loans and Tranche B Term Loans are made available to the Agent. All
Tranche A Term Loans and Tranche B Term Loans on the date hereof shall
be Base Rate Loans. Thereafter, all or any portion of the Tranche A
Term Loans and Tranche B Term Loans may be converted into Eurodollar
Loans in accordance with the terms of Section 2.2.
(c) Amortization. The principal amount of the Tranche A Term
Loans and Tranche B Term Loans shall be repaid in quarterly payments in
the amounts and on the dates set forth below:
Tranche A
Principal Term Loan Principal Principal Tranche B
Amortization Amortization Amortization Term Loan Principal
Payment Dates Payment Payment Dates Amortization Payment
March 31, 1998 $1,230,000 March 31, 1998 $ 87,500
June 30, 1998 $1,230,000 June 30, 1998 $ 87,500
September 30, 1998 $1,230,000 September 30, 1998 $ 87,500
December 31, 1998 $1,400,000 December 31, 1998 $ 87,500
March 31, 1999 $1,400,000 March 31, 1999 $ 87,500
June 30, 1999 $1,400,000 June 30, 1999 $ 87,500
September 30, 1999 $1,400,000 September 30, 1999 $ 87,500
December 31, 1999 $1,650,000 December 31, 1999 $ 87,500
March 31, 2000 $1,650,000 March 31, 2000 $ 87,500
June 30, 2000 $1,650,000 June 30, 2000 $ 87,500
September 30, 2000 $1,650,000 September 30, 2000 $ 87,500
December 31, 2000 $1,650,000 December 31, 2000 $ 87,500
March 31, 2001 $1,650,000 March 31, 2001 $ 87,500
June 30, 2001 $1,650,000 June 30, 2001 $ 87,500
September 30, 2001 $1,650,000 September 30, 2001 $1,000,000
December 31, 2001 $1,650,000 December 31, 2001 $3,250,000
March 31, 2002 $1,650,000 March 31, 2002 $3,250,000
June 26, 2002 $1,750,000 June 30, 2002 $3,250,000
September 30, 2002 $3,250,000
December 31, 2002 $3,250,000
March 31, 2003 $3,250,000
June 30, 2003 $3,250,000
9
Tranche A
Principal Term Loan Principal Principal Tranche B
Amortization Amortization Amortization Term Loan Principal
Payment Dates Payment Payment Dates Amortization Payment
September 30, 2003 $3,250,000
December 31, 2003 $3,250,000
February 14, 2004 $3,350,000
Total $27,540,000.00 Total $34,825,000.00
2.2 Continuations and Conversions.
Subject to the terms of Section 5.1, the Borrower shall have the
option, on any Business Day, to continue in existence Eurodollar Loans for a
subsequent Interest Period, to convert Base Rate Loans into Eurodollar Loans or
to convert Eurodollar Loans into Base Rate Loans; provided, however, that (a)
each such continuation or conversion must be requested by the Borrower pursuant
to a written Notice of Continuation/Conversion, in the form of Exhibit 2.2, in
compliance with the terms set forth below, (b) except as provided in Section
3.12, Eurodollar Loans may only be continued or converted into Base Rate Loans
on the last day of the Interest Period applicable thereto, (c) Eurodollar Loans
may not be continued nor may Base Rate Loans be converted into Eurodollar Loans
during the existence and continuation of a Default or Event of Default and (d)
any request to extend a Eurodollar Loan that fails to comply with the terms
hereof or any failure to request an extension of a Eurodollar Loan at the end of
an Interest Period shall constitute a request for a conversion to a Base Rate
Loan on the last day of the applicable Interest Period. Each continuation or
conversion must be requested by the Borrower no later than 11:00 a.m. (i) one
Business Day prior to the date for a requested conversion of a Eurodollar Loan
to a Base Rate Loan or (ii) three Business Days prior to the date for a
requested extension of a Eurodollar Loan or conversion of a Base Rate Loan to a
Eurodollar Loan, in each case pursuant to a written Notice of
Continuation/Conversion submitted to the Agent which shall set forth (A) whether
the Loans to be continued or converted are Tranche A Term Loans or Tranche B
Term Loans, (B) whether the Borrower wishes to continue or convert such Loans
and (C) if the request is to continue a Eurodollar Loan or convert a Base Rate
Loan to a Eurodollar Loan, the Interest Period applicable thereto.
2.3 Minimum Amounts.
Each request for a conversion or continuation shall be subject to the
requirements that (a) each Eurodollar Loan shall be in a minimum amount of
$1,000,000 and in integral multiples of $500,000 in excess thereof, (b) each
Base Rate Loan shall be in a minimum amount of the lesser of $1,000,000 (and
integral multiples of $500,000 in excess thereof) or the then remaining
principal balance of the Tranche A Term Loan or Tranche B Term Loan, if less, as
applicable, and (c) no more than ten Eurodollar Loans shall, in the aggregate,
be outstanding under the New Credit Agreement and hereunder at any one time. For
the purposes of this Section, all Eurodollar Loans with the same Interest
Periods shall be considered as one Eurodollar Loan, but Eurodollar Loans with
different Interest Periods, even if they begin on the same date, shall be
considered as separate Eurodollar Loans.
10
2.4 Notes.
(a) Tranche A Term Loan Notes. The Tranche A Term Loans made
by the Supplemental Credit Lenders having a Tranche A Term Loan
Commitment Percentage shall be evidenced by a duly executed promissory
note of the Borrower to each such Supplemental Credit Lender in the
face amount of its Tranche A Term Loan Commitment Percentage of the
Tranche A Term Loan Committed Amount in substantially the form of
Exhibit 2.4(a).
(b) Tranche B Term Loan Notes. The Tranche B Term Loans made
by the Supplemental Credit Lenders having a Tranche B Term Loan
Commitment Percentage shall be evidenced by a duly executed promissory
note of the Borrower to each such Supplemental Credit Lender in the
face amount of its Tranche B Term Loan Commitment Percentage of the
Tranche B Term Loan Committed Amount in substantially the form of
Exhibit 2.4(b).
SECTION 3
GENERAL PROVISIONS APPLICABLE TO LOANS
3.1 Interest.
(a) Interest Rate. All Base Rate Loans shall accrue interest
at the Adjusted Base Rate and all Eurodollar Loans shall accrue
interest at the Adjusted Eurodollar Rate.
(b) Default Rate of Interest. Upon the occurrence, and during
the continuance, of an Event of Default, the principal of and, to the
extent permitted by law, interest on the Tranche A Term Loans and
Tranche B Term Loans and any other amounts owing hereunder or under the
other Credit Documents (including without limitation fees and expenses)
shall bear interest, payable on demand, at a per annum rate equal to 4%
plus the rate which would otherwise be applicable (or if no rate is
applicable, then the rate for Revolving Loans that are Base Rate Loans
plus four percent (4%) per annum).
(c) Interest Payments. Interest on Tranche A Term Loans and
Tranche B Term Loans shall be due and payable in arrears on each
Interest Payment Date. If an Interest Payment Date falls on a date
which is not a Business Day, such Interest Payment Date shall be deemed
to be the next succeeding Business Day (subject to accrual of interest
for the period of such extension), except that in the case of
Eurodollar Loans where the next succeeding Business Day falls in the
next succeeding calendar month, then on the next preceding day.
3.2 Place and Manner of Payments.
All payments of principal, interest, fees, expenses and other amounts
to be made by a Credit Party under this Credit Agreement shall be received not
later than 2:00 p.m. on the date when due, in Dollars and in immediately
available funds, by the Agent at its offices at XxxxxxxXxxx Xxxxx,
00
Xxxxxxxxx, Xxxxx Xxxxxxxx. Payments received after such time shall be deemed to
have been received on the next Business Day. Payments received after such time
shall be deemed to have been received on the next Business Day. The Borrower
shall, at the time it makes any payment under this Credit Agreement, specify to
the Agent, the Tranche A Term Loans, the Tranche B Term Loans, fees or other
amounts payable by the Borrower hereunder to which such payment is to be applied
(and in the event that it fails to specify, or if such application would be
inconsistent with the terms hereof, the Agent shall, subject to Section 3.7,
distribute such payment to the Supplemental Credit Lenders in such manner as the
Agent may deem appropriate). The Agent will distribute such payments to the
applicable Supplemental Credit Lenders on the date received if any such payment
is received prior to 2:00 p.m.; otherwise the Agent will distribute such payment
to the applicable Supplemental Credit Lenders on the next succeeding Business
Day. Whenever any payment hereunder shall be stated to be due on a day which is
not a Business Day, the due date thereof shall be extended to the next
succeeding Business Day (subject to accrual of interest and fees for the period
of such extension), except that in the case of Eurodollar Loans, if the
extension would cause the payment to be made in the next following calendar
month, then such payment shall instead be made on the next preceding Business
Day.
3.3 Prepayments.
(a) Voluntary Prepayments. The Borrower shall have the right
to prepay Tranche A Term Loans and Tranche B Term Loans in whole or in
part from time to time without premium or penalty; provided, however,
that (i) Eurodollar Loans may only be prepaid on three Business Days'
prior written notice to the Agent and any prepayment of Eurodollar
Loans will be subject to Section 3.15; (ii) Base Rate Loans may only be
prepaid after written notice (confirmed by a telephone call from the
Borrower) to the Agent not later than 11:00 a.m. on the Business Day of
the applicable prepayment; (iii) each such partial prepayment shall be
(A) in the case of the Tranche A Term Loans in the minimum principal
amount of $1,000,000 and integral multiples of $1,000,000 in excess
thereof and (B) in the case of Tranche B Term Loans in the minimum
principal amount of $1,000,000 and integral multiples of $1,000,000 in
excess thereof; (iv) voluntary prepayments with respect to the Term
Loans shall be applied pro rata between the outstanding Tranche A Term
Loans and Tranche B Term Loans (pro rata among the remaining Principal
Amortization Payments in inverse order of maturity thereof); and (v)
any prepayment of Tranche A Term Loans and Tranche B Term Loans made
prior to June 26, 1998 shall be subject to the prepayment penalty
provisions of Section 3.3(d) hereof.
(b) Mandatory Prepayments.
(i) Excess Cash Flow. Within 10 days after the
date the audited financial statements are required to be
delivered pursuant to Section 7.1(a), the Borrower shall make
a prepayment of the Loans in an amount equal to 75% of the
Excess Cash Flow earned during such prior fiscal year (to be
applied as set forth in Section 3.3(c) below).
(ii) Asset Dispositions. Immediately upon
receipt by the Borrower or any of its Subsidiaries of proceeds
from any Asset Disposition, the Borrower shall forward 100% of
the Net Cash Proceeds of such Asset Disposition to
12
the Lenders as a prepayment of the Loans (to be applied as
set forth in Section 3.3(c) below).
(iii) Issuances of Equity. Immediately upon
receipt by the Borrower or any of its Subsidiaries of proceeds
from any Equity Issuance (other than the issuance of capital
stock of the Borrower in connection with the Borrower's
purchase of the Acquired Assets), the Borrower shall forward
50% of the Net Cash Proceeds of such Equity Issuance to the
Lenders as a prepayment of the Loans (to be applied as set
forth in Section 3.3(c) below).
(iv) Recovery Event. Subject to the terms and
conditions of Section 7.6 hereof, immediately upon receipt by
the Borrower or any of its Subsidiaries of proceeds from any
Recovery Event, the Borrower shall forward 100% of the Net
Cash Proceeds from such Recovery Event to the Lenders as a
prepayment of the Loans (to be applied as set forth in Section
3.3(c) below).
(v) Debt Issuances. Immediately upon receipt by
the Borrower or any of its Subsidiaries of proceeds from any
Debt Issuance, the Borrower shall prepay the Loans in an
aggregate amount equal to 100% of the Net Cash Proceeds of
such Debt Issuance to the Lenders such prepayment to be
applied as set forth in Section 3.3(c) below.
(c) Application of Prepayments. All amounts required to be
paid pursuant to Section 3.3(b)(ii), (iii), (iv), (v) and (vi) above
shall be applied, first pro rata among the outstanding Tranche A Term
Loans and Tranche B Term Loans (which amounts shall then be applied to
the remaining Principal Amortization Payments due with respect to the
Tranche A Term Loans and Tranche B Term Loans in inverse order of
maturity thereof), second to the Revolving Loans (with a corresponding
reduction in the Revolving Committed Amount) and third to Swingline
Loans (with a corresponding reduction in the Revolving Committed
Amount). One or more holders of the Tranche B Term Loans may decline to
accept a mandatory prepayment under Sections 3.3(b)(ii), (iii), (iv),
(v) or (vi) with respect to the Tranche B Term Loans (to the extent
there is sufficient Tranche A Term Loans outstanding to be paid with
such prepayment) in which case such declined prepayments shall be
allocated pro rata among the Tranche A Term Loans and among the Tranche
B Term Loans held by Lenders accepting such prepayments; provided,
however a Lender declining to accept a mandatory prepayment shall be
required to make such election to decline with respect to the Tranche B
Term Loan of such Lender. Within the parameters of the application set
forth above, prepayments shall be applied first to Base Rate Loans and
then to Eurodollar Loans in direct order of Interest Period maturities.
All prepayments hereunder shall be subject to Section 3.15.
(d) Prepayment Penalty. In the event the Borrower voluntarily
elects to prepay any Tranche A Term Loan and Tranche B Term Loan prior
to June 26, 1998 as permitted by Section 3.3(a) hereof and such
prepayment is made with the proceeds of any other Indebtedness, the
Borrower shall be obligated to pay a prepayment fee equal to one-half
percent (1/2%) of the principal amount prepaid; provided, however, the
prepayment fees referred to in this Section 3.3(d) shall not apply to
any voluntary prepayment made with any
13
part of the fifty percent (50%) portion of proceeds from an Equity
Issuance that the Borrower is permitted to retain pursuant to Section
3.3(b)(iv) hereof. After June 26, 1998, the Borrower may prepay the
Tranche A Term Loan and the Tranche B Term Loan without a prepayment
penalty or fee.
3.4 Fees.
The Borrower agrees to pay to the Agent, for its own account, an annual
fee as agreed to between the Borrower and the Agent in the Fee Letter.
3.5 Payment in full at Maturity.
(a) On the Tranche A Term Loan Maturity Date, the entire
outstanding principal balance of all Tranche A Term Loans, together
with accrued but unpaid interest and all other sums owing with respect
thereto, shall be due and payable in full, unless accelerated sooner
pursuant to Section 9 hereof.
(b) On the Tranche B Term Loan Maturity Date, the entire
outstanding principal balance of all Tranche B Term Loans, together
with accrued but unpaid interest and all other sums owing with respect
thereto, shall be due and payable in full, unless accelerated sooner
pursuant to Section 9 hereof.
3.6 Computations of Interest and Fees.
(a) Except for Base Rate Loans, in which case interest shall
be computed on the basis of a 365 or 366 day year as the case may be
(unless the Base Rate is determined by reference to the Federal Funds
Rate), all computations of interest and fees hereunder shall be made on
the basis of the actual number of days elapsed over a year of 360 days.
Interest shall accrue from and include the date of borrowing (or
continuation or conversion) but exclude the date of payment.
(b) It is the intent of the Supplemental Credit Lenders and
the Credit Parties to conform to and contract in strict compliance with
applicable usury law from time to time in effect. All agreements
between the Supplemental Credit Lenders and the Borrower are hereby
limited by the provisions of this paragraph which shall override and
control all such agreements, whether now existing or hereafter arising
and whether written or oral. In no way, nor in any event or contingency
(including but not limited to prepayment or acceleration of the
maturity of any obligation), shall the interest taken, reserved,
contracted for, charged, or received under this Credit Agreement, under
the Tranche A Term Loan Notes, Tranche B Term Loan Notes or otherwise,
exceed the maximum nonusurious amount permissible under applicable law.
If, from any possible construction of any of the Supplemental Credit
Documents or any other document, interest would otherwise be payable in
excess of the maximum nonusurious amount, any such construction shall
be subject to the provisions of this paragraph and such documents shall
be automatically reduced to the maximum nonusurious amount permitted
under applicable law, without the necessity of execution of any
amendment or new document. If any Supplemental Credit Lender shall ever
receive anything of value which is characterized as interest on the
14
Tranche A Loans or Tranche B Term Loans under applicable law and which
would, apart from this provision, be in excess of the maximum lawful
amount, an amount equal to the amount which would have been excessive
interest shall, without penalty, be applied to the reduction of the
principal amount owing on the Tranche A Term Loans or Tranche B Term
Loans, as appropriate, and not to the payment of interest, or refunded
to the Borrower or the other payor thereof if and to the extent such
amount which would have been excessive exceeds such unpaid principal
amount of the Tranche A Term Loans or Tranche B Term Loans. The right
to demand payment of the Tranche A Term Loans or Tranche B Term Loans
or any other indebtedness evidenced by any of the Supplemental Credit
Documents does not include the right to receive any interest which has
not otherwise accrued on the date of such demand, and the Supplemental
Credit Lenders do not intend to charge or receive any unearned interest
in the event of such demand. All interest paid or agreed to be paid to
the Supplemental Credit Lenders with respect to the Tranche A Term
Loans or Tranche B Term Loans shall, to the extent permitted by
applicable law, be amortized, prorated, allocated, and spread
throughout the full stated term (including any renewal or extension) of
the Tranche A Term Loans or Tranche B Term Loans so that the amount of
interest on account of such indebtedness does not exceed the maximum
nonusurious amount permitted by applicable law.
3.7 Pro Rata Treatment.
Except to the extent otherwise provided herein, each Loan borrowing,
each payment or prepayment of principal of any Loan, each payment of fees and
the Administrative Fees retained by the Agent for its own account, each
reduction of the Revolving Committed Amount, and each conversion or continuation
of any Loan, shall be allocated pro rata among the relevant Lenders in
accordance with the respective Revolving Loan Commitment Percentages, Tranche A
Term Loan Commitment Percentages and Tranche B Term Loan Commitment Percentages,
as applicable, of such Lenders (or, if the Commitments of such Lenders have
expired or been terminated, in accordance with the respective principal amounts
of their outstanding Loans and Participation Interests of such Lenders);
provided that, if any Lender shall have failed to pay its applicable pro rata
share of any Loan, then any amount to which such Lender would otherwise be
entitled pursuant to this Section shall instead be payable to the Agent;
provided further, that in the event any amount paid to any Lender pursuant to
this Section is rescinded or must otherwise be returned by the Agent, each
Lender shall, upon the request of the Agent, repay to the Agent the amount so
paid to such Lender, with interest for the period commencing on the date such
payment is returned by the Agent until the date the Agent receives such
repayment at a rate per annum equal to, during the period to but excluding the
date two Business Days after such request, the Federal Funds Rate, and
thereafter, the Base Rate plus four percent (4%) per annum.
3.8 Allocation of Payments After Event of Default.
Notwithstanding any other provisions of this Credit Agreement or the
New Credit Agreement, after the occurrence and during the continuance of an
Event of Default, all amounts collected or received by the Agent or any Lender
on account of amounts outstanding under any of the Credit Documents or in
respect of the Collateral shall be paid over or delivered as follows:
15
FIRST, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation reasonable attorneys' fees)
of the Agent in connection with enforcing the rights of the Lenders
under the Credit Documents and any protective advances made by the
Agent with respect to the Collateral under or pursuant to the terms of
the Collateral Documents;
SECOND, to payment of any fees owed to the Agent in its
capacity as the Agent;
THIRD, to the payment of all reasonable out-of-pocket costs
and expenses, (including, without limitation, reasonable attorneys'
fees) of each of the Lenders in connection with enforcing its rights
under the Credit Documents;
FOURTH, to the payment of all accrued fees and interest
payable to the Lenders hereunder and under the New Credit Agreement;
FIFTH, to the payment of the outstanding principal amount of
the Loans, and to any principal amounts outstanding under Hedging
Agreements, pro rata, as set forth below;
SIXTH, to all other obligations which shall have become due
and payable under the Credit Documents and not repaid pursuant to
clauses "FIRST" through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whoever may
be lawfully entitled to receive such surplus.
In carrying out the foregoing, (a) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category and (b) each of the Lenders shall receive an amount equal to
its pro rata share (based on the proportion that the then outstanding Loans, and
obligations under Hedging Agreements held by such Lender bears to the aggregate
then outstanding Loans, and obligations under Hedging Agreements) of amounts
available to be applied pursuant to clauses "THIRD", "FOURTH," "FIFTH," and
"SIXTH" above.
3.9 Sharing of Payments.
The Supplemental Credit Lenders agree among themselves that, except to
the extent otherwise provided herein, in the event that any Lender shall obtain
payment in respect of any Loan or any other obligation owing to such Lender
under this Credit Agreement or the New Credit Agreement through the exercise of
a right of setoff, banker's lien or counterclaim, or pursuant to a secured claim
under Section 506 of the Bankruptcy Code or other security or interest arising
from, or in lieu of, such secured claim, received by such Lender under any
applicable bankruptcy, insolvency or other similar law or otherwise, or by any
other means, in excess of its pro rata share of such payment as provided for in
this Credit Agreement and the New Credit Agreement, such Lender shall promptly
purchase from the other Lenders for cash an interest in such Loans and other
obligations in such amounts, and make such other adjustments from time to time,
as shall be equitable to the end that all Lenders share such payment in
accordance with their respective ratable shares as provided for in this Credit
Agreement and the New Credit Agreement. The Supplemental Credit Lenders further
agree among themselves that if payment to a Lender obtained by such Lender
through the exercise of a right of setoff, banker's lien, counterclaim or other
event as
16
aforesaid shall be rescinded or must otherwise be restored, each Lender
which shall have shared the benefit of such payment shall, by repurchase of the
interest theretofore sold, return its share of that benefit (together with its
share of any accrued interest payable with respect thereto) to each Lender whose
payment shall have been rescinded or otherwise restored. The Borrower agrees
that any Lender so purchasing such an interest may, to the fullest extent
permitted by law, exercise all rights of payment, including setoff, banker's
lien or counterclaim, with respect to such interest as fully as if such Lender
were a holder of such Loan or other obligation in the amount of such interest.
Except as otherwise expressly provided in this Credit Agreement, if any Lender
or the Agent shall fail to remit to the Agent or any other Lender an amount
payable by such Lender or the Agent to the Agent or such other Lender pursuant
to this Credit Agreement or the New Credit Agreement on the date when such
amount is due, such payments shall be made together with interest thereon for
each date from the date such amount is due until the date such amount is paid to
the Agent or such other Lender at a rate per annum equal to the Federal Funds
Rate. If under any applicable bankruptcy, insolvency or other similar law, any
Lender receives a secured claim in lieu of a setoff to which this Section 3.9
applies, such Lender shall, to the extent practicable, exercise its rights in
respect of such secured claim in a manner consistent with the rights of the
Lenders under this Section 3.9 to share in the benefits of any recovery on such
secured claim.
3.10 Capital Adequacy.
If, after the date hereof, any Supplemental Credit Lender has
determined that the adoption or the becoming effective of, or any change in, or
any change by any Governmental Authority, central bank or comparable agency
charged with the interpretation or administration thereof in the interpretation
or administration of, any applicable law, rule or regulation regarding capital
adequacy, or compliance by such Supplemental Credit Lender with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on such Supplemental Credit Lender's
capital or assets as a consequence of its commitments or obligations hereunder
to a level below that which such Supplemental Credit Lender could have achieved
but for such adoption, effectiveness, change or compliance (taking into
consideration such Supplemental Credit Lender's policies with respect to capital
adequacy), then, upon notice from such Supplemental Credit Lender to the
Borrower, the Borrower shall be obligated to pay to such Supplemental Credit
Lender such additional amount or amounts as will compensate such Supplemental
Credit Lender for such reduction. Each determination by any such Supplemental
Credit Lender of amounts owing under this Section shall, absent manifest error,
be conclusive and binding on the parties hereto.
3.11 Inability To Determine Interest Rate.
If prior to the first day of any Interest Period, the Agent shall have
determined (which determination shall be conclusive and binding upon the
Borrower) that, by reason of circumstances affecting the relevant market,
adequate and reasonable means do not exist for ascertaining the Eurodollar Rate
for such Interest Period, the Agent shall promptly give telecopy or telephonic
notice thereof to the Borrower and the Supplemental Credit Lenders. If such
notice is given (a) any Eurodollar Loans requested to be made on the first day
of such Interest Period shall be made as Base Rate Loans, (b) any Tranche A Term
Loans or Tranche B Term Loans that were to have been converted on the first day
of such Interest Period to or continued as Eurodollar Loans shall be
17
converted to or continued as Base Rate Loans and (c) any outstanding Eurodollar
Loans shall be converted, on the first day of such Interest Period, to Base Rate
Loans. Until such notice has been withdrawn by the Agent, no further Eurodollar
Loans shall be made or continued as such, nor shall the Borrower have the right
to convert Base Rate Loans to Eurodollar Loans.
3.12 Illegality.
Notwithstanding any other provision herein, if the adoption of or any
change in any Requirement of Law or in the interpretation or application thereof
occurring after the Closing Date shall make it unlawful for any Supplemental
Credit Lender to make or maintain Eurodollar Loans as contemplated by this
Credit Agreement, (a) such Supplemental Credit Lender shall promptly give
written notice of such circumstances to the Borrower and the Agent (which notice
shall be withdrawn whenever such circumstances no longer exist), (b) the
commitment of such Supplemental Credit Lender hereunder to make Eurodollar
Loans, continue Eurodollar Loans as such and convert a Base Rate Loan to
Eurodollar Loans shall forthwith be canceled and, until such time as it shall no
longer be unlawful for such Supplemental Credit Lender to make or maintain
Eurodollar Loans, such Supplemental Credit Lender shall then have a commitment
only to make a Base Rate Loan when a Eurodollar Loan is requested and (c) such
Supplemental Credit Lender's Tranche A Loans and Tranche B Term Loans then
outstanding as Eurodollar Loans, if any, shall be converted automatically to
Base Rate Loans on the respective last days of the then current Interest Periods
with respect to such Tranche A Term Loans and Tranche B Term Loans or within
such earlier period as required by law. If any such conversion of a Eurodollar
Loan occurs on a day which is not the last day of the then current Interest
Period with respect thereto, the Borrower shall pay to such Supplemental Credit
Lender such amounts, if any, as may be required pursuant to Section 3.15.
3.13 Requirements of Law.
If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof applicable to any Supplemental Credit
Lender, or compliance by any Supplemental Credit Lender with any request or
directive (whether or not having the force of law) from any central bank or
other Governmental Authority, in each case made subsequent to the Closing Date
(or, if later, the date on which such Supplemental Credit Lender becomes a
Supplemental Credit Lender):
(a) shall subject such Supplemental Credit Lender to any tax
of any kind whatsoever with respect to any Eurodollar Loans made by it
or its obligation to make Eurodollar Loans, or change the basis of
taxation of payments to such Supplemental Credit Lender in respect
thereof (except for Non-Excluded Taxes covered by Section 3.14
(including Non-Excluded Taxes imposed solely by reason of any failure
of such Supplemental Credit Lender to comply with its obligations under
Section 3.14(b)) and changes in taxes measured by or imposed upon the
overall net income, or franchise tax (imposed in lieu of such net
income tax), of such Supplemental Credit Lender or its applicable
lending office, branch, or any affiliate thereof);
(b) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in
18
or for the account of, advances, loans or other extensions of credit
by, or any other acquisition of funds by, any office of such
Supplemental Credit Lender which is not otherwise included in the
determination of the Eurodollar Rate hereunder; or
(c) shall impose on such Supplemental Credit Lender any other
condition (excluding any tax of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such
Supplemental Credit Lender, by an amount which such Supplemental Credit Lender
reasonably deems to be material, of making, converting into, continuing or
maintaining Eurodollar Loans or to reduce any amount receivable hereunder in
respect thereof, then, in any such case, upon notice to the Borrower from such
Supplemental Credit Lender, through the Agent, in accordance herewith, the
Borrower shall be obligated to promptly pay such Supplemental Credit Lender,
upon its demand, any additional amounts necessary to compensate such
Supplemental Credit Lender for such increased cost or reduced amount receivable,
provided that, in any such case, the Borrower may elect to convert the
Eurodollar Loans made by such Supplemental Credit Lender hereunder to Base Rate
Loans by giving the Agent at least one Business Day's notice of such election,
in which case the Borrower shall promptly pay to such Supplemental Credit
Lender, upon demand, without duplication, such amounts, if any, as may be
required pursuant to Section 3.15. If any Supplemental Credit Lender becomes
entitled to claim any additional amounts pursuant to this Section 3.13, it shall
provide prompt notice thereof to the Borrower, through the Agent, certifying (x)
that one of the events described in this Section 3.13 has occurred and
describing in reasonable detail the nature of such event, (y) as to the
increased cost or reduced amount resulting from such event and (z) as to the
additional amount demanded by such Supplemental Credit Lender and a reasonably
detailed explanation of the calculation thereof. Such a certificate as to any
additional amounts payable pursuant to this Section 3.13 submitted by such
Supplemental Credit Lender, through the Agent, to the Borrower shall be
conclusive and binding on the parties hereto in the absence of manifest error.
This covenant shall survive the termination of this Credit Agreement and the
payment of the Tranche A Term Loans and Tranche B Term Loans and all other
amounts payable hereunder.
3.14 Taxes.
(a) Except as provided below in this Section 3.14, all
payments made by the Borrower under this Credit Agreement, any Tranche
A Term Loan Notes and any Tranche B Term Loan Notes shall be made free
and clear of, and without deduction or withholding for or on account
of, any present or future income, stamp or other taxes, levies,
imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any
court, or governmental body, agency or other official, excluding taxes
measured by or imposed upon the overall net income of any Supplemental
Credit Lender or its applicable lending office, or any branch or
affiliate thereof, and all franchise taxes, branch taxes, taxes on
doing business or taxes on the overall capital or net worth of any
Supplemental Credit Lender or its applicable lending office, or any
branch or affiliate thereof, in each case imposed in lieu of net income
taxes: (i) by the jurisdiction under the laws of which such
Supplemental Credit Lender, applicable lending office, branch or
affiliate is organized or is located, or in which its principal
executive office is located, or any nation within which such
jurisdiction is located or any political subdivision thereof; or (ii)
by reason of any connection between the jurisdiction imposing
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such tax and such Supplemental Credit Lender, applicable lending
office, branch or affiliate other than a connection arising solely
from such Supplemental Credit Lender having executed, delivered or
performed its obligations, or received payment under or enforced, this
Credit Agreement, or any Tranche A Supplemental Term Loan Notes or any
Tranche B Term Loan Notes. If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings
("Non-Excluded Taxes") are required to be withheld from any amounts
payable to the Agent or any Supplemental Credit Lender hereunder or
under any Tranche A Term Loan Notes or any Tranche B Term Loan Notes,
(A) the amounts so payable to the Agent or such Supplemental Credit
Lender shall be increased to the extent necessary to yield to the
Agent or such Supplemental Credit Lender (after payment of all
Non-Excluded Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Credit
Agreement, any Tranche A Term Loan Notes or any Tranche B Term Loan
Notes, provided, however, that the Borrower shall be entitled to
deduct and withhold any Non-Excluded Taxes and shall not be required
to increase any such amounts payable to any Supplemental Credit Lender
that is not organized under the laws of the United States of America
or a state thereof if such Supplemental Credit Lender fails to comply
with the requirements of paragraph (b) of this Section 3.14 whenever
any Non-Excluded Taxes are payable by the Borrower, and (B) as
promptly as possible thereafter the Borrower shall send to the Agent
for its own account or for the account of such Supplemental Credit
Lender, as the case may be, a certified copy of an original official
receipt received by the Borrower showing payment thereof. If the
Borrower fails to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fails to remit to the Agent the
required receipts or other required documentary evidence, the Borrower
shall indemnify the Agent and the Supplemental Credit Lenders for any
incremental taxes, interest or penalties that may become payable by
the Agent or any Supplemental Credit Lender as a result of any such
failure. The agreements in this subsection shall survive the
termination of this Credit Agreement and the payment of the Tranche A
Term Loans, Tranche B Term Loans and all other amounts payable
hereunder.
(b) Each Supplemental Credit Lender that is not incorporated
under the laws of the United States of America or a state thereof
shall:
(i) (A) on or before the date of any payment
by the Borrower under this Credit Agreement or
Tranche A Term Loan Notes or Tranche B Term Loan
Notes to such Supplemental Credit Lender, deliver to
the Borrower and the Agent (x) two duly completed
copies of United States Internal Revenue Service Form
1001 or 4224, or successor applicable form, as the
case may be, certifying that it is entitled to
receive payments under this Credit Agreement, any
Tranche A Term Loan Notes or Tranche B Term Loan
Notes without deduction or withholding of any United
States federal income taxes or (y) an Internal
Revenue Service Form W-8 or W-9, or successor
applicable form, as the case may be, certifying that
it is entitled to an exemption from United States
backup withholding tax;
(B) deliver to the Borrower and the
Agent two further copies of any such form or
certification on or before the date that any
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such form or certification expires or becomes
obsolete and after the occurrence of any event
requiring a change in the most recent form previously
delivered by it to the Borrower; and
(C) obtain such extensions of time
for filing and complete such forms or certifications
as may reasonably be requested by the Borrower or the
Agent; or
(ii) in the case of any such Supplemental
Credit Lender that is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Internal Revenue Code, (A)
represent to the Borrower (for the benefit of the Borrower and
the Agent) that it is not a bank within the meaning of Section
881(c)(3)(A) of the Internal Revenue Code, (B) agree to
furnish to the Borrower, on or before the date of any payment
by the Borrower, with a copy to the Agent, two accurate and
complete original signed copies of Internal Revenue Service
Form W-8, or successor applicable form certifying to such
Supplemental Credit Lender's legal entitlement at the date of
such certificate to an exemption from U.S. withholding tax
under the provisions of Section 881(c) of the Internal Revenue
Code with respect to payments to be made under this Credit
Agreement, any Tranche A Term Loan Notes and any Tranche B
Term Loan Notes (and to deliver to the Borrower and the Agent
two further copies of such form on or before the date it
expires or becomes obsolete and after the occurrence of any
event requiring a change in the most recently provided form
and, if necessary, obtain any extensions of time reasonably
requested by the Borrower or the Agent for filing and
completing such forms), and (C) agree, to the extent legally
entitled to do so, upon reasonable request by the Borrower, to
provide to the Borrower (for the benefit of the Borrower and
the Agent) such other forms as may be reasonably required in
order to establish the legal entitlement of such Supplemental
Credit Lender to an exemption from withholding with respect to
payments under this Credit Agreement, any Tranche A Term Loan
Notes and any Tranche B Term Loan Notes.
Notwithstanding the above, if any change in treaty, law or regulation
has occurred after the date such Person becomes a Supplemental Credit
Lender hereunder which renders all such forms inapplicable or which
would prevent such Supplemental Credit Lender from duly completing and
delivering any such form with respect to it and such Supplemental
Credit Lender so advises the Borrower and the Agent then such
Supplemental Credit Lender shall be exempt from such requirements. Each
Person that shall become a Supplemental Credit Lender or a participant
of a Supplemental Credit Lender pursuant to Section 11.3 shall, upon
the effectiveness of the related transfer, be required to provide all
of the forms, certifications and statements required pursuant to this
subsection (b); provided that in the case of a participant of a
Supplemental Credit Lender, the obligations of such participant of a
Supplemental Credit Lender pursuant to this subsection (b) shall be
determined as if the participant of a Supplemental Credit Lender were a
Supplemental Credit Lender except that such participant of a
Supplemental Credit Lender shall furnish all such required forms,
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certifications and statements to the Supplemental Credit Lender from
which the related participation shall have been purchased.
3.15 Indemnity.
The Borrower promises to indemnify each Supplemental Credit Lender and
to hold each Supplemental Credit Lender harmless from any loss or expense which
such Supplemental Credit Lender may sustain or incur (other than through such
Supplemental Credit Lender's gross negligence or willful misconduct) as a
consequence of (a) default by the Borrower in making a borrowing of, conversion
into or continuation of Eurodollar Loans after the Borrower has given a notice
requesting the same in accordance with the provisions of this Credit Agreement,
(b) default by the Borrower in making any prepayment of a Eurodollar Loan after
the Borrower has given a notice thereof in accordance with the provisions of
this Credit Agreement and (c) the making of a prepayment of Eurodollar Loans on
a day which is not the last day of an Interest Period with respect thereto. Such
indemnification may include an amount equal to (i) the amount of interest which
would have accrued on the amount so prepaid, or not so borrowed, converted or
continued, for the period from the date of such prepayment or of such failure to
borrow, convert or continue to the last day of the applicable Interest Period
(or, in the case of a failure to borrow, convert or continue, the Interest
Period that would have commenced on the date of such failure) in each case at
the applicable rate of interest for such Eurodollar Loans provided for herein
(excluding, however, the Applicable Percentage included therein, if any) minus
(ii) the amount of interest (as reasonably determined by such Supplemental
Credit Lender) which would have accrued to such Supplemental Credit Lender on
such amount by placing such amount on deposit for a comparable period with
leading banks in the interbank Eurodollar market. The agreements in this Section
shall survive the termination of this Credit Agreement, the payment of the
Tranche A Term Loans and the payment of the Tranche B Term Loans and all other
amounts payable hereunder.
3.16 Replacement of Lenders.
If any Supplemental Credit Lender delivers a notice to the Borrower
pursuant to Sections 3.10, 3.13 or 3.14, then the Borrower shall have the right,
if no Default or Event of Default then exists, to either (i) replace such
Supplemental Credit Lender (the "Replaced Lender") with one or more additional
banks or financial institutions (collectively, the "Replacement Lender"),
provided that (A) at the time of any replacement pursuant to this Section 3.16,
the Replacement Lender shall enter into one or more assignment agreements
substantially in the form of Exhibit 11.3 pursuant to, and in accordance with
the terms of, Section 11.3(b) (and with all fees payable pursuant to said
Section 11.3(b) to be paid by the Replacement Lender) pursuant to which the
Replacement Lender shall acquire all of the rights and obligations of the
Replaced Lender hereunder and, in connection therewith, shall pay to the
Replaced Lender in respect thereof an amount equal to the sum of (a) the
principal of, and all accrued interest on, all outstanding Loans of the Replaced
Lender, and (b) all accrued, but theretofore unpaid, fees owing to the Replaced
Lender pursuant to Section 3.4, and (B) all obligations of the Borrower owing to
the Replaced Lender (including all obligations, if any, owing pursuant to
Section 3.10, 3.13 or 3.14, but excluding those obligations specifically
described in clause (A) above in respect of which the assignment purchase price
has been, or is concurrently being paid) shall be paid in full to such Replaced
Lender concurrently with such replacement or (ii) if a Replacement Lender is not
located within 60 days of such notice, terminate the
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Commitments and repay the Loans in full within 120 days of receipt of such
notice without incurring any prepayment penalty under Section 3.3(d).
SECTION 4
GUARANTY
4.1 Guaranty of Payment.
Subject to Section 4.7 below, each of the Guarantors hereby, jointly
and severally, unconditionally guarantees to each Supplemental Credit Lender,
each Affiliate of Supplemental Credit Lender that enters into a Hedging
Agreement and the Agent the prompt payment of the Credit Party Obligations in
full when due (whether at stated maturity, as a mandatory prepayment, by
acceleration or otherwise). The Guarantors additionally, jointly and severally,
unconditionally guarantee to each Supplemental Credit Lender the timely
performance of all other obligations under the Supplemental Credit Documents and
Hedging Agreements. This Guaranty is a guaranty of payment and not of collection
and is a continuing guaranty and shall apply to all Credit Party Obligations
whenever arising.
4.2 Obligations Unconditional.
The obligations of the Guarantors hereunder are absolute and
unconditional, irrespective of the value, genuineness, validity, regularity or
enforceability of any of the Supplemental Credit Documents or the Hedging
Agreements, or any other agreement or instrument referred to therein, to the
fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever which might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor. Each Guarantor agrees that this
Guaranty may be enforced by the Supplemental Credit Lenders without the
necessity at any time of resorting to or exhausting any other security or
collateral and without the necessity at any time of having recourse to the
Tranche A Term Loan Notes, Tranche B Term Loan Notes or any other of the
Supplemental Credit Documents or any collateral, if any, hereafter securing the
Credit Party Obligations or otherwise and each Guarantor hereby waives the right
to require the Supplemental Credit Lenders to proceed against the Borrower or
any other Person (including a co-guarantor) or to require the Supplemental
Credit Lenders to pursue any other remedy or enforce any other right. Each
Guarantor further agrees that it shall have no right of subrogation, indemnity,
reimbursement or contribution against the Borrower or any other Guarantor of the
Credit Party Obligations for amounts paid under this Guaranty until such time as
the Supplemental Credit Lenders (and any Affiliates of Supplemental Credit
Lenders entering into Hedging Agreements) have been paid in full, Tranche A Term
Loan Committed Amount and the Tranche B Term Loan Committed Amount under the
Credit Agreement have been terminated and no Person or Governmental Authority
shall have any right to request any return or reimbursement of funds from the
Supplemental Credit Lenders in connection with monies received under the
Supplemental Credit Documents. Each Guarantor further agrees that nothing
contained herein shall prevent the Supplemental Credit Lenders from suing on the
Tranche A Term Loan Notes, the Tranche B Term Loan Notes or any of the other
Supplemental Credit Documents or any of the Hedging Agreements or foreclosing
its security interest in or Lien on any collateral, if any, securing the Credit
Party Obligations or from exercising any other rights available to it under this
Credit
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Agreement, the Tranche A Term Loan Notes, the Tranche B Term Loan Notes,
any other of the Supplemental Credit Documents, or any other instrument of
security, if any, and the exercise of any of the aforesaid rights and the
completion of any foreclosure proceedings shall not constitute a discharge of
any of any Guarantor's obligations hereunder; it being the purpose and intent of
each Guarantor that its Guarantor's obligations hereunder shall be absolute,
independent and unconditional under any and all circumstances. Neither any
Guarantor's obligations under this Guaranty nor any remedy for the enforcement
thereof shall be impaired, modified, changed or released in any manner
whatsoever by an impairment, modification, change, release or limitation of the
liability of the Borrower or by reason of the bankruptcy or insolvency of the
Borrower. Each Guarantor waives any and all notice of the creation, renewal,
extension or accrual of any of the Credit Party Obligations and notice of or
proof of reliance by the Agent or any Supplemental Credit Lender upon this
Guarantee or acceptance of this Guarantee. The Credit Party Obligations, and any
of them, shall conclusively be deemed to have been created, contracted or
incurred, or renewed, extended, amended or waived, in reliance upon this
Guarantee. All dealings between the Borrower and any of the Guarantors, on the
one hand, and the Agent and the Supplemental Credit Lenders, on the other hand,
likewise shall be conclusively presumed to have been had or consummated in
reliance upon this Guarantee.
4.3 Modifications.
Each Guarantor agrees that (a) all or any part of the security now or
hereafter held for the Credit Party Obligations, if any, may be exchanged,
compromised or surrendered from time to time; (b) the Supplemental Credit
Lenders shall not have any obligation to protect, perfect, secure or insure any
such security interests, liens or encumbrances now or hereafter held, if any,
for the Credit Party Obligations or the properties subject thereto; (c) the time
or place of payment of the Credit Party Obligations may be changed or extended,
in whole or in part, to a time certain or otherwise, and may be renewed or
accelerated, in whole or in part; (d) the Borrower and any other party liable
for payment under the Supplemental Credit Documents may be granted indulgences
generally; (e) any of the provisions of the Tranche A Term Loan Notes, Tranche B
Term Loan Notes, or any of the other Supplemental Credit Documents may be
modified, amended or waived; (f) any party (including any co-guarantor) liable
for the payment thereof may be granted indulgences or be released; and (g) any
deposit balance for the credit of the Borrower or any other party liable for the
payment of the Credit Party Obligations or liable upon any security therefor may
be released, in whole or in part, at, before or after the stated, extended or
accelerated maturity of the Credit Party Obligations, all without notice to or
further assent by the Guarantor, which shall remain bound thereon,
notwithstanding any such exchange, compromise, surrender, extension, renewal,
acceleration, modification, indulgence or release.
4.4 Waiver of Rights.
Each Guarantor expressly waives: (a) notice of acceptance of this
Guaranty by the Supplemental Credit Lenders and of all extensions of credit to
the Borrower by the Supplemental Credit Lenders; (b) presentment and demand for
payment or performance of any of the Credit Party Obligations; (c) protest and
notice of dishonor or of default (except as specifically required in the Credit
Agreement) with respect to the Credit Party Obligations or with respect to any
security therefor; (d) notice of the Supplemental Credit Lenders obtaining,
amending, substituting for, releasing, waiving or modifying any security
interest, lien or encumbrance, if any, hereafter
24
securing the Credit Party Obligations, or the Supplemental Credit Lenders'
subordinating, compromising, discharging or releasing such security interests,
liens or encumbrances, if any; (e) all other notices to which the Guarantor
might otherwise be entitled; and (f) demand for payment under this Guaranty.
4.5 Reinstatement.
The obligations of the Guarantors under this Section 4 shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Credit Party Obligations is
rescinded or must be otherwise restored by any holder of any of the Credit Party
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it will indemnify
the Agent and each Lender on demand for all reasonable costs and expenses
(including, without limitation, reasonable fees of counsel) incurred by an Agent
or such Supplemental Credit Lender in connection with such rescission or
restoration, including any such costs and expenses incurred in defending against
any claim alleging that such payment constituted a preference, fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law.
4.6 Remedies.
The Guarantors agree that, as between the Guarantors, on the one hand,
and the Agent and the Supplemental Credit Lenders, on the other hand, the Credit
Party Obligations may be declared to be forthwith due and payable as provided in
Section 9 (and shall be deemed to have become automatically due and payable in
the circumstances provided in Section 9) notwithstanding any stay, injunction or
other prohibition preventing such declaration (or preventing such Credit Party
Obligations from becoming automatically due and payable) as against any other
Person and that, in the event of such declaration (or such Credit Party
Obligations being deemed to have become automatically due and payable), such
Credit Party Obligations (whether or not due and payable by any other Person)
shall forthwith become due and payable by the Guarantors. The Guarantors
acknowledge and agree that their obligations hereunder are secured in accordance
with the terms of the Security Agreements and the other Collateral Documents and
that the Supplemental Credit Lenders may exercise their remedies thereunder in
accordance with their terms.
4.7 Limitation of Guaranty.
Notwithstanding any provision to the contrary contained herein or in
any of the Supplemental Credit Documents, to the extent the obligations of any
Guarantor shall be adjudicated to be invalid or unenforceable for any reason
(including, without limitation, because of any applicable state or federal law
relating to fraudulent conveyances or transfers) then the obligations of such
Guarantor hereunder shall be limited to the maximum amount that is permissible
under applicable law (whether federal or state and including, without
limitation, the Bankruptcy Code).
4.8 Rights of Contribution.
The Guarantors hereby agree, as among themselves, that if any Guarantor
shall become an Excess Funding Guarantor (as defined below), each other
Guarantor shall, on demand of such Excess Funding Guarantor (but subject to the
next sentence hereof), pay to such Excess Funding
25
Guarantor an amount equal to such Guarantor's Pro Rata Share (as defined below
and determined, for this purpose, without reference to the properties, assets,
liabilities and debts of such Excess Funding Guarantor) of such Excess Payment
(as defined below). The payment obligation of any Guarantor to any Excess
Funding Guarantor under this Section 4.8 shall be subordinate and subject in
right of payment to the prior payment in full of the obligations of such
Guarantor under the other provisions of this Section 4, and such Excess Funding
Guarantor shall not exercise any right or remedy with respect to such excess
until payment and satisfaction in full of all of such obligations. For purposes
hereof, (i) "Excess Funding Guarantor" shall mean, in respect of any obligations
arising under the other provisions of this Section 4 (hereafter, the "Guaranteed
Obligations"), a Guarantor that has paid an amount in excess of its Pro Rata
Share of the Guaranteed Obligations; (ii) "Excess Payment" shall mean, in
respect of any Guaranteed Obligations, the amount paid by an Excess Funding
Guarantor in excess of its Pro Rata Share of such Guaranteed Obligations; and
(iii) "Pro Rata Share", for the purposes of this Section 4.8, shall mean, for
any Guarantor, the ratio (expressed as a percentage) of (a) the amount by which
the aggregate present fair saleable value of all of its assets and properties
exceeds the amount of all debts and liabilities of such Guarantor (including
contingent, subordinated, unmatured, and unliquidated liabilities, but excluding
the obligations of such Guarantor hereunder) to (b) the amount by which the
aggregate present fair saleable value of all assets and other properties of the
Borrower and all of the Guarantors exceeds the amount of all of the debts and
liabilities (including contingent, subordinated, unmatured, and unliquidated
liabilities, but excluding the obligations of the Borrower and the Guarantors
hereunder) of the Borrower and all of the Guarantors, all as of the Closing Date
(if any Guarantor becomes a party hereto subsequent to the Closing Date, then
for the purposes of this Section 4.8 such subsequent Guarantor shall be deemed
to have been a Guarantor as of the Closing Date and the information pertaining
to, and only pertaining to, such Guarantor as of the date such Guarantor became
a Guarantor shall be deemed true as of the Closing Date).
SECTION 5
CONDITIONS TO EXTENSIONS OF CREDIT
5.1 Conditions to Extensions of Credit.
The Supplemental Credit Lenders shall not be obligated to continue or
convert Tranche A Term Loans or Tranche B Term Loans unless:
(a) Notice: The Borrower shall have delivered in the case of
any continuation or conversion of a Tranche A Term Loan or Tranche B
Term Loan, a duly executed and completed Notice of
Continuation/Conversion by the time specified in Section 2.2;
(b) Representations and Warranties. The representations and
warranties made by the Credit Parties in the Supplemental Credit
Documents are true and correct in all material respects at and as if
made as of such date;
(c) No Default. No Default or Event of Default shall exist
or be continuing either prior to or after giving effect thereto; and
26
(d) No Material Adverse Effect: There shall not have occurred
any Material Adverse Effect.
The delivery of each Notice of Continuation/Conversion shall constitute
a representation and warranty by the Borrower of the correctness of the matters
specified in subsection (b), (c) and (d) above.
SECTION 6
REPRESENTATIONS AND WARRANTIES
The Credit Parties hereby represent to the Agent and each Supplemental
Credit Lender that:
6.1 Financial Condition.
The financial statements delivered to the Lenders pursuant to Section
5.1(c)(ii) of the New Credit Agreement, (a) have been prepared in accordance
with GAAP and (b) present fairly (on the basis disclosed in the footnotes to
such financial statements) the consolidated and consolidating (as applicable)
financial condition, results of operations and cash flows of the Credit Parties
and their Subsidiaries as of such date and for such periods. Since November 30,
1996, there has been no sale, transfer or other disposition by the Borrower or
any of its Subsidiaries of any material part of the business or property of the
Borrower or any of its Subsidiaries and no purchase or other acquisition (other
than the Acquired Assets) by any of them of any business or property (including
any capital stock of any other Person) material in relation to the consolidated
financial condition of the Borrower and its Subsidiaries, in each case, which,
is not reflected in the foregoing financial statements or in the notes thereto.
6.2 No Material Change.
Since November 30, 1996, (a) there has been no development or event
relating to or affecting Borrower or any of its Subsidiaries which has had or
would be reasonably expected to have a Material Adverse Effect and (b) no
dividends or other distributions have been declared, paid or made upon the
capital stock or other equity interest in Borrower or any of its Subsidiaries
nor, except as otherwise permitted under this Credit Agreement, has any of the
capital stock or other equity interest in a Credit Party been redeemed, retired,
purchased or otherwise acquired for value.
6.3 Organization and Good Standing.
The Borrower and each of its Subsidiaries (a) is a corporation duly
incorporated, validly existing and in good standing under the laws of the State
(or other jurisdiction) of its incorporation, (b) is duly qualified and in good
standing as a foreign corporation authorized to do business in every
jurisdiction where the failure to be so qualified would have a Material Adverse
Effect and (c) has the requisite corporate power and authority to own its
properties and to carry on its business as now conducted and as proposed to be
conducted.
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6.4 Due Authorization.
Each Credit Party (a) has the requisite corporate power and authority
to execute, deliver and perform this Credit Agreement and the other Supplemental
Credit Documents to which it is a party and to incur the obligations herein and
therein provided for and (b) is duly authorized to, and has been authorized by
all necessary corporate action, to execute, deliver and perform this Credit
Agreement and the other Supplemental Credit Documents to which it is a party.
6.5 No Conflicts.
Neither the execution and delivery of the Supplemental Credit
Documents, nor the consummation of the transactions contemplated therein, nor
performance of and compliance with the terms and provisions thereof by such
Credit Party will (a) violate or conflict with any provision of its articles or
certificate of incorporation or bylaws, (b) violate, contravene or materially
conflict with any Requirement of Law or any other law, regulation (including,
without limitation, Regulation U or Regulation X), order, writ, judgment,
injunction, decree or permit applicable to it, (c) violate, contravene or
conflict with contractual provisions of, or cause an event of default under, any
indenture, loan agreement, mortgage, deed of trust, contract or other agreement
or instrument to which it is a party or by which it may be bound, the violation
of which could have or might be reasonably expected to have a Material Adverse
Effect, or (d) result in or require the creation of any Lien (other than those
contemplated in or created in connection with the Supplemental Credit Documents)
upon or with respect to its properties.
6.6 Consents.
No consent, approval, authorization or order of, or filing,
registration or qualification with, any court or Governmental Authority or third
party in respect of a Credit Party is required in connection with the execution,
delivery or performance of this Credit Agreement or any of the other
Supplemental Credit Documents by a Credit Party, or if required, such consent,
approval and authorization has been obtained.
6.7 Enforceable Obligations.
This Credit Agreement and the other Supplemental Credit Documents have
been duly executed and delivered and constitute legal, valid and binding
obligations of each Credit Party enforceable against such Credit Party in
accordance with their respective terms, except as may be limited by bankruptcy
or insolvency laws or similar laws affecting creditors' rights generally or by
general equitable principles.
6.8 No Default.
Neither the Borrower nor any of its Subsidiaries is in default in any
respect under any contract, lease, loan agreement, indenture, mortgage, security
agreement or other agreement or obligation to which it is a party or by which
any of its properties is bound which default would have or would be reasonably
expected to have a Material Adverse Effect. No Default or Event of Default has
occurred or exists except as previously disclosed to the Supplemental Credit
Lenders.
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6.9 Ownership.
The Borrower and each of its Subsidiaries is the owner of and has good
and marketable title to all of its assets and none of such assets are subject to
any Lien other than Permitted Liens.
6.10 Indebtedness.
The Borrower and its Subsidiaries have no Indebtedness except (a) as
disclosed in the financial statements referenced in Section 6.1, (b) as set
forth on Schedule 6.10 and (c) as otherwise permitted by this Credit Agreement.
6.11 Litigation.
There are no actions, suits or legal, equitable, arbitration or
administrative proceedings, pending or, to the knowledge of any Credit Party,
threatened against the Borrower or any of its Subsidiaries which, if adversely
determined, would have or would be reasonably expected to have a Material
Adverse Effect.
6.12 Taxes.
Each of the Borrower and its Subsidiaries has filed, or caused to be
filed, all tax returns (federal, state, local and foreign) required to be filed
and paid (a) all amounts of taxes shown thereon to be due (including interest
and penalties) and (b) all other taxes, fees, assessments and other governmental
charges (including mortgage recording taxes, documentary stamp taxes and
intangibles taxes) owing by it, except for such taxes (i) which are not yet
delinquent or (ii) that are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with GAAP. No Credit Party is aware of any proposed tax assessments
against it, any of its Subsidiaries or any other Credit Party.
6.13 Compliance with Law.
Each of the Borrower and its Subsidiaries is in compliance with all
Requirements of Law and all other laws, rules, regulations, orders and decrees
(including without limitation Environmental Laws) applicable to it, or to its
properties, unless such failure to comply would not have or would not be
reasonably expected to have a Material Adverse Effect. No Requirement of Law
would be reasonably expected to cause a Material Adverse Effect.
6.14 ERISA.
Except as set forth on Schedule 6.14 or except as would not result in a
Material Adverse Effect:
(a) During the five-year period prior to the date on which
this representation is made or deemed made: (i) no Termination Event
has occurred, and, to the best knowledge of the Credit Parties, no
event or condition has occurred or exists as a result of which any
Termination Event could reasonably be expected to occur, with respect
to any Plan; (ii) no "accumulated funding deficiency," as such term is
defined in Section 302 of ERISA and
29
Section 412 of the Code, whether or not waived, has occurred with
respect to any Plan; (iii) each Plan has been maintained, operated,
and funded in compliance with its own terms and in material compliance
with the provisions of ERISA, the Code, and any other applicable
federal or state laws; and (iv) no lien in favor or the PBGC or a Plan
has arisen or is reasonably likely to arise on account of any Plan.
(b) The actuarial present value of all "benefit liabilities"
under each Single Employer Plan (determined within the meaning of
Section 401(a)(2) of the Code, utilizing the actuarial assumptions used
to fund such Plans), whether or not vested, did not, as of the last
annual valuation date prior to the date on which this representation is
made or deemed made, exceed the current value of the assets of such
Plan allocable to such accrued liabilities.
(c) Neither the Borrower, nor any of its Subsidiaries nor any
ERISA Affiliate has incurred, or, to the best knowledge of the Credit
Parties, are reasonably expected to incur, any withdrawal liability
under ERISA to any Multiemployer Plan or Multiple Employer Plan.
Neither the Borrower, nor any of its Subsidiaries nor any ERISA
Affiliate has received any notification that any Multiemployer Plan is
in reorganization (within the meaning of Section 4241 of ERISA), is
insolvent (within the meaning of Section 4245 of ERISA), or has been
terminated (within the meaning of Title IV of ERISA), and no
Multiemployer Plan is, to the best knowledge of the Credit Parties,
reasonably expected to be in reorganization, insolvent, or terminated.
(d) No prohibited transaction (within the meaning of Section
406 of ERISA or Section 4975 of the Code) or breach of fiduciary
responsibility has occurred with respect to a Plan which has subjected
or may subject the Borrower or any of its Subsidiaries or any ERISA
Affiliate to any liability under Sections 406, 409, 502(i), or 502(l)
of ERISA or Section 4975 of the Code, or under any agreement or other
instrument pursuant to which the Borrower or any of its Subsidiaries or
any ERISA Affiliate has agreed or is required to indemnify any person
against any such liability.
(e) The present value (determined using actuarial and other
assumptions which are reasonable with respect to the benefits provided
and the employees participating) of the liability of the Borrower and
its Subsidiaries and each ERISA Affiliate for post-retirement welfare
benefits to be provided to their current and former employees under
Plans which are welfare benefit plans (as defined in Section 3(1) of
ERISA), net of all assets under all such Plans allocable to such
benefits, are reflected on the Financial Statements in accordance with
FAS 106.
(f) Each Plan which is a welfare plan (as defined in Section
3(1) of ERISA) to which Sections 601-609 of ERISA and Section 4980B of
the Code apply has been administered in compliance in all material
respects with such sections.
6.15 Subsidiaries.
Set forth on Schedule 6.15 is a complete and accurate list of all
Subsidiaries of each Credit Party. Information on Schedule 6.15 includes
jurisdiction of incorporation, the number of
30
shares of each class of capital stock or other equity interests outstanding, the
number and percentage of outstanding shares of each class owned (directly or
indirectly) by such Credit Party; and the number and effect, if exercised, of
all outstanding options, warrants, rights of conversion or purchase and all
other similar rights with respect thereto. The outstanding capital stock and
other equity interests of all such Subsidiaries is validly issued, fully paid
and non-assessable and is owned by each such Credit Party, directly or
indirectly, free and clear of all Liens (other than those arising under or
contemplated in connection with the Supplemental Credit Documents). Other than
as set forth in Schedule 6.15, neither any Credit Party nor any Subsidiary
thereof has outstanding any securities convertible into or exchangeable for its
capital stock nor does any such Person have outstanding any rights to subscribe
for or to purchase or any options for the purchase of, or any agreements
providing for the issuance (contingent or otherwise) of, or any calls,
commitments or claims of any character relating to its capital stock.
6.16 Use of Proceeds; Margin Stock.
The proceeds of the Tranche A Term Loans and Tranche B Term Loans
hereunder will be used solely for the purposes specified in Section 7.10. None
of the proceeds of the Tranche A Term Loans and Tranche B Term Loans will be
used for the purpose of purchasing or carrying any "margin stock" as defined in
Regulation U, Regulation X or Regulation G, or for the purpose of reducing or
retiring any Indebtedness which was originally incurred to purchase or carry
"margin stock" or any "margin security" or for any other purpose which might
constitute this transaction a "purpose credit" within the meaning of Regulation
U, Regulation X, Regulation G or Regulation T.
None of the Credit Parties owns any "margin stock".
6.17 Government Regulation.
No Credit Party is subject to regulation under the Public Utility
Holding Company Act of 1935, the Federal Power Act, the Investment Company Act
of 1940 or the Interstate Commerce Act, each as amended. In addition, no Credit
Party is an "investment company" registered or required to be registered under
the Investment Company Act of 1940, as amended, or controlled by such a company,
or a "holding company," or a "Subsidiary company" of a "holding company," or an
"affiliate" of a "holding company" or of a "Subsidiary" or a "holding company,"
within the meaning of the Public Utility Holding Company Act of 1935, as
amended. No director, executive officer or principal shareholder of the Borrower
or any of its Subsidiaries is a director, executive officer or principal
shareholder of any Lender. For the purposes hereof the terms "director",
"executive officer" and "principal shareholder" (when used with reference to any
Lender) have the respective meanings assigned thereto in Regulation O issued by
the Board of Governors of the Federal Reserve System.
6.18 Environmental Matters.
(a) Except as set forth on Schedule 6.18:
(i) each of the Real Properties and all operations at
the Real Properties are in compliance with all applicable
Environmental Laws, and there is no violation of any
Environmental Law with respect to the Real Properties or the
businesses operated by the Borrower or any of its Subsidiaries
(the "Businesses"), and there are
31
no conditions relating to the Businesses or Real Properties
that could give rise to liability under any applicable
Environmental Laws.
(ii) None of the Real Properties contains, or has
previously contained, any Hazardous Materials at, on or under
the Real Properties in amounts or concentrations that, if
released, constitute or constituted a violation of, or could
give rise to liability under, Environmental Laws.
(iii) Neither the Borrower nor any of its
Subsidiaries has received any written or oral notice of, or
inquiry from any Governmental Authority regarding, any
violation, alleged violation, non-compliance, liability or
potential liability regarding Hazardous Materials or
compliance with Environmental Laws with regard to any of the
Real Properties, Leasehold Properties or the Businesses, nor
does the Borrower or any of its Subsidiaries have knowledge or
reason to believe that any such notice is being threatened.
(iv) Hazardous Materials have not been transported or
disposed of from the Real Properties, or generated, treated,
stored or disposed of at, on or under any of the Real
Properties or any other location, in each case by, or on
behalf or with the permission of, the Borrower or any of its
Subsidiaries in a manner that would reasonably be expected to
give rise to liability under any applicable Environmental Law.
(v) No judicial proceeding or governmental or
administrative action is pending or, to the knowledge of the
Borrower or any of its Subsidiaries, threatened, under any
Environmental Law to which the Borrower or any of its
Subsidiaries is or will be named as a party, nor are there any
consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative
or judicial requirements outstanding under any Environmental
Law with respect to the Borrower or any of its Subsidiaries,
the Real Properties or the Businesses.
(vi) There has been no release or threat of release
of Hazardous Materials at or from the Real Properties, or
arising from or related to the operations (including, without
limitation, disposal) of the Borrower or any of its
Subsidiaries in connection with the Real Properties or
otherwise in connection with the Businesses.
(vii) Neither the Borrower nor any of its
Subsidiaries has assumed any liability of any Person (other
than another Credit Party) under any Environmental Law.
(b) The Borrower has adopted procedures that are designed to
(i) ensure that each Credit Party and their Subsidiaries, any of their
operations and each of the properties owned or leased by each Credit
Party and their Subsidiaries remains in compliance with applicable
Environmental Laws and (ii) minimize any liabilities or potential
liabilities that each Credit Party and their Subsidiaries, any of their
operations and each of the properties owned or leased by each Credit
Party and their Subsidiaries may have under applicable Environmental
Laws.
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6.19 Intellectual Property.
The Borrower and each of its Subsidiaries owns, or has the legal right
to use, all trademarks, tradenames, copyrights, technology, know-how and
processes (the "Intellectual Property") necessary for each of them to conduct
its business as currently conducted except for those the failure to own or have
such legal right to use would not have or be reasonably expected to have a
Material Adverse Effect. Set forth on Schedule 6.19 is a list of all
Intellectual Property owned by the Borrower and its Subsidiaries or that the
Borrower or one of its Subsidiaries has the right to use (which list shall
identify the Person that owns or has the right to use each such item of
Intellectual Property). Except as provided on Schedule 6.19, no claim has been
asserted and is pending by any Person challenging or questioning the use of any
such Intellectual Property or the validity or effectiveness of any such
Intellectual Property, nor does any Credit Party know of any such claim, and to
the Credit Parties' knowledge the use of such Intellectual Property by the
Borrower or any of its Subsidiaries does not infringe on the rights of any
Person, except for such claims and infringements that in the aggregate, would
not have or be reasonably expected to have a Material Adverse Effect.
6.20 Solvency.
Each Credit Party is and, after consummation of the transactions
contemplated by this Credit Agreement and the New Credit Agreement, will be
Solvent.
6.21 Investments.
All Investments of the Borrower and each of its Subsidiaries are either
Permitted Investments or otherwise permitted by the terms of this Credit
Agreement.
6.22 No Financing of Corporate Takeovers.
No proceeds of the Loans hereunder have been or will be used to
acquire, directly or indirectly, any security in any transaction which is
subject to Sections 13 or 14 of the Securities Exchange Act of 1934, as amended
(including, without limitation, Sections 13(d) and 14(d) thereof) or to
refinance any Indebtedness used to acquire any such securities.
6.23 Location of Collateral.
Set forth on Schedule 6.23(a) is a list of all Real Properties and
Leasehold Properties with street address, county and state where located. Set
forth on Schedule 6.23(b) is a list of all locations where any personal property
of a Credit Party is located, including county and state where located. Set
forth on Schedule 6.23(c) is the chief executive office and principal place of
business of each Credit Party.
6.24 Disclosure.
Neither this Credit Agreement nor any financial statements delivered to
the Supplemental Credit Lenders nor any other document, certificate or statement
furnished to the Supplemental
33
Credit Lenders by or on behalf of any Credit Party in connection with the
transactions contemplated hereby contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the statements
contained therein or herein not misleading.
6.25 Licenses, etc.
The Borrower and each of its Subsidiaries has obtained and holds in
full force and effect, all franchises, licenses, permits, certificates,
authorizations, qualifications, accreditations, easements, rights of way and
other rights, consents and approvals which are necessary for the operation of
their respective businesses as presently conducted.
6.26 No Burdensome Restrictions.
Neither the Borrower nor any Subsidiary of the Borrower is a party to
any agreement or instrument or subject to any other obligation or any charter or
corporate restriction or any provision of any applicable law, rule or regulation
which, individually or in the aggregate, would have or be reasonably expected to
have a Material Adverse Effect.
6.27 Brokers' Fees.
No Credit Party has any obligation to any Person in respect of any
finder's, broker's, investment banking or other similar fee in connection with
any of the transactions contemplated under the Supplemental Credit Documents.
6.28 Labor Matters.
There are no collective bargaining agreements or Multiemployer Plans
covering the employees of the Borrower or any Subsidiary of the Borrower and
none of such Persons has suffered any strikes, walkouts, work stoppages or other
material labor difficulty within the last five years.
6.29 Collateral Documents.
The Collateral Documents create valid security interests in, and first
Liens on, the Collateral purported to be covered thereby, which security
interests and Liens are and will remain perfected security interests and Liens,
prior to all other Liens other than Permitted Liens. Each of the representations
and warranties made by the Borrower and its Subsidiaries in the Collateral
Documents is true and correct.
6.30 Related Transactions.
The closing of the acquisition of the Acquired Assets will occur
simultaneously with the making of the initial Loans hereunder and under the New
Credit Agreement, and no party waived, without the consent of the Required
Lenders, any condition precedent to their obligations to close as set forth in
the Purchase Agreement. True and complete copies of the Purchase Agreement have
been delivered to each of the Supplemental Credit Lenders, together with a true
and complete copy of each document to be delivered at the closing of the
acquisition of the Acquired Assets.
34
6.31 Representations and Warranties Incorporated from Purchase
Agreement.
As of the Closing Date, each of the representations and warranties made
in the Purchase Agreement by each of the parties thereto is true and correct in
all material respects, and such representations and warranties are hereby
incorporated herein by reference with the same effect as though set forth in
their entirety herein, as qualified therein.
6.32 Senior Debt.
The Tranche A Term Loans and Tranche B Term Loans are Senior Debt (as
defined in the Indenture) under Article 10.02 of the Indenture, meaning the
Supplemental Credit Lenders shall have all of the rights and privileges of a
holder of Senior Debt (as defined in the Indenture) under the Indenture
including, but not limited to, the rights set forth in Article 10 of the
Indenture. The Tranche A Term Loans and Tranche B Term Loans are Senior Debt (as
defined in the Second Indenture) under the Second Indenture, meaning the
Supplemental Credit Lenders shall have all of the rights and privileges of a
holder of Senior Indebtedness (as defined in the Second Indenture) under the
Second Indenture.
SECTION 7
AFFIRMATIVE COVENANTS
Each Credit Party hereby covenants and agrees that so long as this
Credit Agreement is in effect and until the Loans, together with interest, fees
and other obligations hereunder have been paid in full and the Commitments
hereunder shall have terminated:
7.1 Information Covenants.
The Borrower will furnish, or cause to be furnished, to the Agent:
(a) Annual Financial Statements. As soon as available, and in
any event within 120 days after the close of each fiscal year of the
Borrower, a consolidated and consolidating balance sheet and income
statement of the Borrower and its Subsidiaries, as of the end of such
fiscal year, together with related consolidated and consolidating
statements of operations and retained earnings and of cash flows for
such fiscal year, setting forth in comparative form consolidated
figures for the preceding fiscal year, all such financial information
described above to be in reasonable form and detail and audited by
independent certified public accountants of recognized national
standing reasonably acceptable to the Agent and whose opinion shall be
to the effect that such financial statements have been prepared in
accordance with GAAP (except for changes with which such accountants
concur) and shall not be limited as to the scope of the audit or
qualified in any manner.
(b) Quarterly Financial Statements. As soon as available, and
in any event within 45 days after the close of each fiscal quarter of
the Borrower (other than the fourth
35
fiscal quarter, in which case 120 days after the end thereof) a
consolidated balance sheet and income statement of the Borrower and
its Subsidiaries, as of the end of such fiscal quarter, together with
related consolidated statements of operations and retained earnings
and of cash flows for such fiscal quarter in each case setting forth
in comparative form consolidated figures for the corresponding period
of the preceding fiscal year, all such financial information described
above to be in reasonable form and detail and reasonably acceptable to
the Agent, and accompanied by a certificate of the chief financial
officer of the Borrower to the effect that such quarterly financial
statements fairly present in all material respects the financial
condition of the Borrower and its Subsidiaries and have been prepared
in accordance with GAAP, subject to changes resulting from audit and
normal year-end audit adjustments.
(c) Monthly Financial Statements. As soon as available and in
any event within 20 days after the end of each month of the Borrower
(other than the last month of the first three fiscal quarters in which
case 45 days after the end thereof), a consolidated balance sheet and
income statement of the Borrower and its Subsidiaries as at the end of
such month together with (i) related consolidated statements of
operations and retained earnings for such month in each case setting
forth in comparative form consolidated figures for the corresponding
period of the preceding fiscal year and (ii) a separate income
statement for each Foreign Subsidiary (and such other financial
information as reasonably requested by the Agent or the Required
Lenders), all such financial information described above to be in
reasonable form and detail and reasonably acceptable to the Agent, and
accompanied by a certificate of the chief financial officer of the
Borrower to the effect that such monthly financial statements fairly
present in all material respects the financial condition of the
Borrower and its Subsidiaries and have been prepared in accordance with
GAAP, subject to changes resulting from audit and normal year-end audit
adjustments.
(d) Officer's Certificate. At the time of delivery of the
financial statements provided for in Sections 7.1(a) and 7.1(b) above,
a certificate of the chief financial officer of the Borrower
substantially in the form of Exhibit 7.1(d), (i) demonstrating
compliance with the financial covenants contained in Section 7.12 by
calculation thereof as of the end of each such fiscal period and (ii)
stating that no Default or Event of Default exists, or if any Default
or Event of Default does exist, specifying the nature and extent
thereof and what action the Borrower proposes to take with respect
thereto. The Borrower shall also deliver a copy of such certificate to
the Agency Services Address.
(e) Annual Business Plan and Budgets. At least 60 days after
the end of each fiscal year of the Borrower, beginning with the fiscal
year ending November 30, 1998, an annual business plan and budget of
the Borrower and its Subsidiaries containing, among other things, pro
forma financial statements for the next fiscal year.
(f) Compliance With Certain Provisions of the Credit
Agreement. Within 120 days after the end of each fiscal year of the
Borrower, the Borrower shall deliver a certificate, containing
information regarding (i) the calculation of Excess Cash Flow and (ii)
the amount of any Asset Dispositions, Debt Issuances, Equity Issuances
and Recovery Events that were made during the prior fiscal year.
36
(g) Accountant's Certificate. Within the period for delivery
of the annual financial statements provided in Section 7.1(a), a
certificate of the accountants conducting the annual audit stating that
they have reviewed this Credit Agreement and stating further whether,
in the course of their audit, they have become aware of any Default or
Event of Default and, if any such Default or Event of Default exists,
specifying the nature and extent thereof.
(h) Auditor's Reports. Promptly upon receipt thereof, a copy
of any "management letter" submitted by independent accountants to the
Borrower or any of its Subsidiaries in connection with any annual,
interim or special audit of the books of the Borrower or any of its
Subsidiaries.
(i) Reports. Promptly upon transmission or receipt thereof,
(a) copies of any filings and registrations with, and reports to or
from, the Securities and Exchange Commission, or any successor agency,
and copies of all financial statements, proxy statements, notices and
reports as the Borrower or any of its Subsidiaries shall send to its
shareholders generally or to a holder of any Indebtedness owed by the
Borrower or any of its Subsidiaries in its capacity as such a holder
and (b) upon the written request of the Agent, all reports and written
information to and from the United States Environmental Protection
Agency, or any state or local agency responsible for environmental
matters, the United States Occupational Health and Safety
Administration, or any state or local agency responsible for health and
safety matters, or any successor agencies or authorities concerning
environmental, health or safety matters.
(j) Notices. Upon a Credit Party obtaining knowledge thereof,
such Credit Party will give written notice to the Agent immediately of
(a) the occurrence of an event or condition consisting of a Default or
Event of Default, specifying the nature and existence thereof and what
action the Borrower proposes to take with respect thereto, and (b) the
occurrence of any of the following with respect to the Borrower or any
of its Subsidiaries (i) the pendency or commencement of any litigation,
arbitral or governmental proceeding against the Borrower or any of its
Subsidiaries which if adversely determined would have or would be
reasonably expected to have a Material Adverse Effect, or (ii) the
institution of any proceedings against the Borrower or any of its
Subsidiaries with respect to, or the receipt of notice by such Person
of potential liability or responsibility for violation, or alleged
violation of any federal, state or local law, rule or regulation,
including but not limited to, Environmental Laws, the violation of
which would have or would be reasonably expected to have a Material
Adverse Effect.
(k) ERISA. Upon any of the Credit Parties or any ERISA
Affiliate obtaining knowledge thereof, Borrower will give written
notice to the Agent and each of the Supplemental Credit Lenders
promptly (and in any event within five Business Days) of: (i) any event
or condition, including, but not limited to, any Reportable Event, that
constitutes, or might reasonably lead to, a Termination Event; (ii)
with respect to any Multiemployer Plan, the receipt of notice as
prescribed in ERISA or otherwise of any withdrawal liability assessed
against the Borrower or any of its ERISA Affiliates, or of a
determination that any Multiemployer Plan is in reorganization or
insolvent (both within the meaning of Title IV of ERISA); (iii) the
failure to make full payment on or before the due date (including
37
extensions) thereof of all amounts which the Borrower or any of its
Subsidiaries or ERISA Affiliate is required to contribute to each Plan
pursuant to its terms and as required to meet the minimum funding
standard set forth in ERISA and the Code with respect thereto; or (iv)
any change in the funding status of any Plan that could have a Material
Adverse Effect; together, with a description of any such event or
condition or a copy of any such notice and a statement by the principal
financial officer of the Borrower briefly setting forth the details
regarding such event, condition, or notice, and the action, if any,
which has been or is being taken or is proposed to be taken by the
Credit Parties with respect thereto. Promptly upon request, the
Borrower shall furnish the Agent and each of the Lenders with such
additional information concerning any Plan as may be reasonably
requested, including, but not limited to, copies of each annual
report/return (Form 5500 series), as well as all schedules and
attachments thereto required to filed with the Department of Labor
and/or the Internal Revenue Service pursuant to ERISA and the Code,
respectively, for each "plan year" (within the meaning of Section 3(39)
of ERISA).
(l) Environmental.
(i) Upon the reasonable written request of the Agent,
the Borrower will furnish or cause to be furnished to the
Agent, at the Borrower's expense, an environmental assessment
of reasonable scope, form and depth, (including, where
appropriate, invasive soil or groundwater sampling) by a
consultant reasonably acceptable to the Agent as to the nature
and extent of the presence of any Hazardous Materials on any
property owned, leased or operated by the Borrower or any of
its Subsidiaries and as to the compliance by the Borrower and
each of its Subsidiaries with Environmental Laws. If the
Borrower fails to deliver such an environmental report within
seventy-five (75) days after receipt of such written request
then the Agent may arrange for same, and the Borrower hereby
grants to the Agent and its representatives access to the Real
Properties and a license to undertake such an assessment
(including, where appropriate, invasive soil or groundwater
sampling). The reasonable cost of any assessment arranged for
by the Agent pursuant to this provision will be payable by the
Borrower on demand and added to the obligations secured by the
Collateral Documents.
(ii) The Borrower and each of its Subsidiaries will
conduct and complete all investigations, studies, sampling,
and testing and all remedial, removal, and other actions
necessary to address all Hazardous Materials on, from, or
affecting any real property owned or leased by the Borrower or
its Subsidiaries to the extent necessary to be in compliance
with all Environmental Laws and all other applicable federal,
state, and local laws, regulations, rules and policies and
with the orders and directives of all Governmental Authorities
exercising jurisdiction over such real property to the extent
any failure would have or be reasonably expected to have a
Material Adverse Effect.
(m) Star Report. At the time of delivery of the financial
statements provided for in Section 7.1(b) above, a company-prepared
report containing information as to brand sales and advertising cost
analysis for the fiscal quarter of the Borrower most recently ending.
38
(n) Other Information. With reasonable promptness upon any
such request, such other information regarding the business, properties
or financial condition of the Borrower and its Subsidiaries as the
Agent or the Required Lenders may reasonably request.
7.2 Preservation of Existence and Franchises.
Each of the Credit Parties will, and will cause each of its
Subsidiaries to, do all things necessary to preserve and keep in full force and
effect in all material respects its existence, rights, franchises and authority.
7.3 Books and Records.
Each of the Credit Parties will, and will cause each of its
Subsidiaries to, keep complete and accurate books and records of its
transactions in accordance with good accounting practices on the basis of GAAP
(including the establishment and maintenance of appropriate reserves).
7.4 Compliance with Law.
Each of the Credit Parties will, and will cause each of its
Subsidiaries to, comply with all laws, rules, regulations and orders, and all
applicable restrictions imposed by all Governmental Authorities, applicable to
it and its property (including, without limitation, Environmental Laws) if
noncompliance with any such law, rule, regulation, order or restriction would
have or reasonably be expected to have a Material Adverse Effect.
7.5 Payment of Taxes and Other Indebtedness.
Each of the Credit Parties will, and will cause its Subsidiaries to,
pay and discharge (a) all taxes, assessments and governmental charges or levies
imposed upon it, or upon its income or profits, or upon any of its properties,
before they shall become delinquent, (b) all lawful claims (including claims for
labor, materials and supplies) which, if unpaid, might give rise to a Lien upon
any of its properties, and (c) except as prohibited hereunder, all of its other
Indebtedness as it shall become due; provided, however, that a Credit Party or
its Subsidiary shall not be required to pay any such tax, assessment, charge,
levy, claim or Indebtedness which is being contested in good faith by
appropriate proceedings and as to which adequate reserves therefor have been
established in accordance with GAAP, unless the failure to make any such payment
(i) would give rise to an immediate right to foreclose on a Lien securing such
amounts or (ii) would have a Material Adverse Effect.
7.6 Insurance.
Each of the Credit Parties will, and will cause each of its
Subsidiaries to, at all times maintain in full force and effect insurance
(including worker's compensation insurance, liability insurance, casualty
insurance and business interruption insurance) in such amounts, covering such
risks and liabilities and with such deductibles or self-insurance retentions as
are in accordance with normal industry practice. All liability policies shall
have each Supplemental Credit Lender as an
39
additional insured and all casualty policies shall have the Agent, on behalf of
the Supplemental Credit Lenders, as loss payee.
In the event there occurs any material loss, damage to or destruction of the
Collateral of any Credit Party or any part thereof, such Credit Party shall
promptly give written notice thereof to the Agent generally describing the
nature and extent of such damage or destruction. Subsequent to any loss, damage
to or destruction of the Collateral of any Credit Party or any part thereof,
such Credit Party, whether or not the insurance proceeds, if any, received on
account of such damage or destruction shall be sufficient for that purpose, at
such Credit Party's cost and expense, will promptly repair or replace the
Collateral of such Credit Party so lost, damaged or destroyed; provided,
however, that such Credit Party shall not be obligated to repair or replace any
Collateral so lost, damaged or destroyed to the extent the failure to make such
repair or replacement (a) is desirable to the proper conduct of the business of
such Credit Party in the ordinary course and otherwise is in the best interest
of such Credit Party and (b) would not materially impair the rights and benefits
of the Agent or the Supplemental Credit Lenders under this Credit Agreement or
any other Supplemental Credit Documents. In the event a Credit Party shall
receive any insurance proceeds, as a result of any loss, damage or destruction,
in a net amount in excess of $100,000, such Credit Party will immediately pay
over such proceeds to the Agent as cash collateral for the Credit Party
Obligations. The Agent agrees to release such insurance proceeds to such Credit
Party for replacement or restoration of the portion of the Collateral of such
Credit Party lost, damaged or destroyed if, (A) within 120 days from the date
the Agent receives such insurance proceeds, the Agent has received written
application for such release from such Credit Party together with evidence
reasonably satisfactory to it that the Collateral lost, damaged or destroyed has
been or will be replaced or restored to its condition (or by Collateral having a
value at least equal to the condition of the asset subject to the loss, damage
or destruction) immediately prior to the loss, destruction or other event giving
rise to the payment of such insurance proceeds and (B) on the date of such
release no Default or Event of Default exists. If the conditions in the
preceding sentence are not met, the Agent shall, on the first Business Day
subsequent to the date 120 days after it received such insurance proceeds, apply
such insurance proceeds as a mandatory prepayment of the Credit Party
Obligations for application in accordance with the terms of Section 3.3(b)(v)
and Section 3.3(c). All insurance proceeds shall be subject to the security
interest of the Supplemental Credit Lenders under the Collateral Documents.
The present insurance coverage of the Borrower and its Subsidiaries is outlined
as to carrier, policy number, expiration date, type and amount on Schedule 7.6,
as Schedule 7.6 may be amended from time to time by written notice to the Agent.
7.7 Maintenance of Property.
Each of the Credit Parties will, and will cause its Subsidiaries to,
maintain and preserve its properties and equipment in good repair, working order
and condition, normal wear and tear excepted, and will make, or cause to be
made, in such properties and equipment from time to time all repairs, renewals,
replacements, extensions, additions, betterments and improvements thereto as may
be needed or proper, to the extent and in the manner customary for companies in
similar businesses.
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7.8 Performance of Obligations.
Each of the Credit Parties will, and will cause its Subsidiaries to,
perform in all material respects all of its obligations under the terms of all
material agreements, indentures, mortgages, security agreements or other debt
instruments to which it is a party or by which it is bound.
7.9 Collateral.
If, subsequent to the Closing Date, a Credit Party shall (a) acquire or
lease any real property or (b) acquire any intellectual property, securities
instruments, chattel paper or other personal property required to be delivered
to the Agent as Collateral hereunder or under any of the Collateral Documents,
the Borrower shall immediately notify the Agent of same. Each Credit Party shall
take such action (including, but not limited to, the actions set forth in
Sections 5.1(f) and (g) of the New Credit Agreement), as requested by the Agent
and at its own expense, to ensure that the Lenders have a first priority
perfected Lien in all owned real property (and in such leased real property as
requested by the Agent or the Required Lenders) and all personal property of the
Credit Parties (whether now owned or hereafter acquired), subject only to
Permitted Liens. Each Credit Party shall adhere to the covenants regarding the
location of personal property as set forth in the Security Agreements.
7.10 Use of Proceeds.
The Credit Parties will use proceeds of the Tranche A Term Loans and
Tranche B Term Loans solely (a) to refinance on the Closing Date the existing
Indebtedness of the Borrower under Prior Supplemental Credit Agreement and (b)
to pay related fees and expenses in connection with the foregoing.
7.11 Audits/Inspections.
Upon reasonable notice and during normal business hours, each Credit
Party will, and will cause its Subsidiaries to, permit representatives appointed
by the Agent or any Lender, including, without limitation, independent
accountants, agents, attorneys and appraisers to visit and inspect such Credit
Party's (or its Subsidiary's) property, including its books and records, its
accounts receivable and inventory, its facilities and its other business assets,
and to make photocopies or photographs thereof and to write down and record any
information such representative obtains and shall permit the Agent or its
representatives to investigate and verify the accuracy of information provided
to the Lenders and to discuss all such matters with the officers, employees and
representatives of the Credit Parties and their Subsidiaries. The Credit Parties
agree that the Agent, and its representatives, may conduct an annual audit of
the Collateral, at the expense of the Borrower.
7.12 Financial Covenants.
(a) Interest Coverage Ratio. The Interest Coverage Ratio,
as of the end of each fiscal quarter, shall be greater than or equal
to:
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(i) From the Effective Date to and including August 31,
1998, 1.30 to 1.0; and
(ii) From September 1, 1998 and thereafter, 1.40 to 1.0.
(b) Fixed Charge Coverage Ratio. The Fixed Charge Coverage
Ratio, as of the end of each fiscal quarter, shall be greater than or
equal to:
(i) From the Effective Date to and including August 31,
1998, 1.10 to 1.0; and
(ii) From September 1, 1998 and thereafter, 1.20 to 1.0.
(c) Leverage Ratio. The Leverage Ratio, as of the end of each
fiscal quarter, shall be less than or equal to:
(i) From the Effective Date to and including August 30,
1998, 10.0 to 1.0;
(ii) From August 31, 1998 to and including November 29,
1998, 8.50 to 1.0;
(iii) From November 30, 1998 to and including February 27,
1999, 7.50 to 1.0;
(iv) From February 28, 1999 to and including May 30, 1999,
6.75 to 1.0;
(v) From May 31, 1999, to and including August 30, 1999,
5.50 to 1.0; and
(vi) From August 31, 1999 and thereafter, 5.0 to 1.0.
(d) Senior Leverage Ratio. The Senior Leverage Ratio, as of
the end of each fiscal quarter, shall be less than or equal to:
(i) From the Effective Date to and including May 31, 1998,
3.25 to 1.0;
(ii) From June 1, 1998 to and including August 31, 1998, 3.0
to 1.0; and
(iii) From September 1, 1998 and thereafter, 2.50 to 1.0.
(e) Net Worth. At all times Net Worth shall be no less than
Four Million Seven Hundred Thousand ($4,700,000) increased on a
cumulative basis, commencing with the fiscal quarter ending May 31,
1998, by an amount equal to, (i) as of the last day of each
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fiscal quarter, 50% of Net Income for the fiscal quarter then ended
(without deductions for any losses) plus (ii) 100% of the Net Cash
Proceeds from any Equity Issuance subsequent to the Closing Date.
(f) Appraised Brand Value. As of the end of each fiscal
quarter of the Borrower, with respect to the Borrower and its
Subsidiaries on a consolidated basis, the most recent appraised value
of all brands or product lines of the Borrower and its Subsidiaries on
a consolidated basis on such date shall be greater than or equal to
$340 million.
7.13 Additional Credit Parties.
At the time any Person becomes a Subsidiary of a Credit Party, the
Borrower shall so notify the Agent and promptly thereafter (but in any event
within 30 days after the date thereof) shall cause such Person to (a) if it is a
Domestic Subsidiary, execute a Joinder Agreement in substantially the same form
as Exhibit 7.13, (b) cause all of the capital stock of such Person (if such
Person is a Domestic Subsidiary) or 65% of the capital stock of such Person (if
such Person is a Foreign Subsidiary) to be delivered to the Agent (together with
undated stock powers signed in blank) and pledged to the Agent pursuant to an
appropriate pledge agreement in substantially the form of the Pledge Agreement
and otherwise in a form acceptable to the Agent, (c) if such Person is a
Domestic Subsidiary, pledge all of its assets to the Lenders pursuant to a
security agreement in substantially the form of the Security Agreements and
otherwise in a form acceptable to the Agent (d) if such Person has any
Subsidiaries, (i) deliver all of the capital stock of such Domestic Subsidiaries
and 65% of the capital stock of such Foreign Subsidiaries (together with undated
stock powers signed in blank) to the Agent and (ii) execute a pledge agreement
in substantially the form of the Pledge Agreement and otherwise in a form
acceptable to the Agent (e) if such Person owns or leases any real property in
the United States of America, execute any and all necessary mortgages, deeds of
trust, deeds to secure debt, leasehold mortgages, collateral assignments of
leaseholds or other appropriate real estate collateral documentation in a form
acceptable to the Agent and (f) deliver such other documentation as the Agent
may reasonably request in connection with the foregoing, including, without
limitation, appropriate UCC-1 financing statements, real estate title insurance
policies, environmental reports, landlord waivers, certified resolutions and
other organizational and authorizing documents of such Person and favorable
opinions of counsel to such Person (which shall cover, among other things, the
legality, validity, binding effect and enforceability of the documentation
referred to above), all in form, content and scope reasonably satisfactory to
the Agent.
7.14 Interest Rate Protection Agreements.
The Borrower shall, within 30 days of the Closing Date, have in place
interest rate protection agreements, in form and substance acceptable to the
Agent, protecting against fluctuations in interest rates which agreements shall
provide coverage for a period of three (3) years, and in a notional amount of at
least fifty percent (50%) of the outstanding principal amount of the Term Loans.
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7.15 Ownership of Subsidiaries.
The Borrower shall at all times own 100% of the capital stock of its
Subsidiaries (other than to the extent necessary for Chattem (U.K.) Limited and
HBA Insurance Ltd. to qualify for incorporation in their respective countries of
incorporation, any nominal qualifying shares owned by any necessary governmental
authorities) and may not sell, transfer or otherwise dispose of any shares of
capital stock of any of its Subsidiaries.
7.16 Appraisal Reports.
The Borrower and its Subsidiaries shall provide the Agent, upon the
request of the Agent and at the expense of the Borrower, with asset appraisal
reports with respect to the real and personal property of the Borrower and its
Subsidiaries including, without limitation, appraisals of brand values
(provided, however, the Borrower shall not be required to pay for more than one
appraisal of brand values per year). In the event the Agent needs more than one
asset appraisal report of the real and personal property of the Borrower and its
Subsidiaries during any year, the Agent shall have the right to arrange and pay
for such report.
7.17 Year 2000 Compatibility.
Each of the Credit Parties will, and will cause each of its
Subsidiaries to, take all action necessary to assure that its computer based
systems are able to operate and effectively process data including dates on and
after January 1, 2000, and, at the reasonable request of the Agent or the
Required Lenders, the Credit Parties will provide evidence to the Lenders of
such year 2000 compatibility.
SECTION 8
NEGATIVE COVENANTS
Each Credit Party hereby covenants and agrees that so long as this
Credit Agreement is in effect and until the Loans, together with interest, fees
and other obligations hereunder, have been paid in full and the Commitments
hereunder shall have terminated:
8.1 Indebtedness.
No Credit Party will, nor will it permit any of its Subsidiaries to,
contract, create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness arising under this Credit Agreement, the
other Supplemental Credit Documents and the New Credit Agreement
Documents;
(b) the Subordinated Debt;
(c) Indebtedness existing as of the Closing Date as referenced
in Section 6.10 (and renewals, refinancings or extensions thereof on
terms and conditions no more
44
favorable, in the aggregate, to such Person than such existing
Indebtedness and in a principal amount not in excess of that
outstanding as of the date of such renewal, refinancing or extension);
(d) Indebtedness owing by one Credit Party to another
Credit Party;
(e) purchase money Indebtedness (including Capital Leases)
incurred by the Borrower or any of its Subsidiaries to finance the
purchase of fixed assets; provided that (i) the total of all such
Indebtedness for all such Persons taken together shall not exceed an
aggregate principal amount of $2,000,000.00 at any one time outstanding
(including any such Indebtedness referred to in subsection (c) above);
(ii) such Indebtedness when incurred shall not exceed the purchase
price of the asset(s) financed; and (iii) no such Indebtedness shall be
refinanced for a principal amount in excess of the principal balance
outstanding thereon at the time of such refinancing;
(f) obligations of the Credit Parties evidenced by the
interest rate protection agreements referred to in Section 7.14;
(g) Indebtedness incurred by Foreign Subsidiaries not to
exceed $500,000.00, in the aggregate, at any one time outstanding
(including any such Indebtedness referred to in subsection (c) above);
and
(h) the Additional Subordinated Debt.
8.2 Liens.
No Credit Party will, nor will it permit its Subsidiaries to contract,
create, incur, assume or permit to exist any Lien with respect to any of its
property or assets of any kind (whether real or personal, tangible or
intangible), whether now owned or after acquired, except for Permitted Liens.
8.3 Nature of Business.
No Credit Party will, nor will it permit its Subsidiaries to, alter the
character of its business from that conducted as of the Closing Date or engage
in any business other than the business conducted as of the Closing Date, which
with respect to Signal shall be limited to the ownership of trademarks and
tradenames for the purpose of licensing such trademarks and tradenames to the
Borrower.
8.4 Consolidation and Merger.
No Credit Party will, nor will it permit its Subsidiaries to, enter
into any transaction of merger or consolidation or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution); provided that
notwithstanding the foregoing provisions of this Section 8.4, the following
actions may be taken if (a) the Agent is given prior written notice of such
action, and the Credit Parties execute and deliver such documents, instruments
and certificates as the Agent may request in order to maintain the perfection
and priority of the Liens on the assets of the Credit Parties and (b) after
giving effect thereto no Default or Event of Default exists:
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(i) any Credit Party may be merged or consolidated with or
into the Borrower or any Credit Party (other than the Borrower) may be
merged or consolidated with or into any other Credit Party; provided
that if such transaction shall be between the Borrower and another
Credit Party, the Borrower shall be the continuing or surviving
corporation; and
(ii) any Foreign Subsidiary may merge or consolidate with any
other Foreign Subsidiary.
8.5 Sale or Lease of Assets.
No Credit Party will, nor will it permit any of its Subsidiaries to,
convey, sell, lease, transfer or otherwise dispose of, in one transaction or a
series of transactions, all or any part of its business or assets whether now
owned or hereafter acquired, including, without limitation, inventory,
receivables, real property, leasehold interests, equipment and securities other
than (a) any inventory or other assets sold, leased or disposed of (or
simultaneously replaced with like goods) in the ordinary course of business, (b)
obsolete, idle or worn-out assets no longer used or useful in its business, (c)
the sale, lease or transfer or other disposal by a Credit Party other than the
Borrower of any or all of its assets to the Borrower or to any other Credit
Party, or (d) sales of product lines (or the right to produce a consumer product
or products) provided that the dispositions permitted under this subparagraph
(d) during the term of this Credit Agreement shall be limited to product lines
(or the right to produce a consumer product or products) having sales for the
twelve-month period ending on the fiscal quarter ending immediately preceding
the sale in an aggregate amount of $4,000,000 or less.
8.6 Advances, Investments and Loans.
No Credit Party will, nor will it permit any of its Subsidiaries to,
make any Investments except for Permitted Investments.
8.7 Dividends.
No Credit Party will, nor will it permit any of its Subsidiaries to,
directly or indirectly, (a) declare or pay any dividends (whether cash or
otherwise) or make any other distribution upon any shares of its capital stock
of any class other than the payment of dividends by the Subsidiaries of the
Borrower to the Borrower or (b) other than Permitted Investments purchase,
redeem or otherwise acquire or retire or make any provisions for redemption,
acquisition or retirement of any shares of its capital stock of any class or any
warrants or options to purchase any such shares.
8.8 Transactions with Affiliates.
Except as set forth on Schedule 8.8, no Credit Party will, nor will it
permit its Subsidiaries to, enter into any transaction or series of
transactions, whether or not in the ordinary course of business, with any
officer, director, shareholder, Subsidiary or Affiliate other than on terms and
conditions substantially as favorable as would be obtainable in a comparable
arm's-length transaction with a Person other than an officer, director,
shareholder, Subsidiary or Affiliate.
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8.9 Fiscal Year; Organizational Documents.
No Credit Party will, nor will it permit any of its Subsidiaries to,
change its fiscal year or materially change its charter documents or its bylaws
without the prior written consent of the Required Lenders.
8.10 Prepayments of Indebtedness.
No Credit Party will, nor will it permit any of its Subsidiaries to,
(a) amend or modify (or permit the amendment or modification of) any of the
terms of any Indebtedness if such amendment or modification would add or change
any terms in a manner adverse to the Supplemental Credit Lenders, including but
not limited to, shortening final maturity or average life to maturity of such
Indebtedness or requiring any payment to be made sooner than originally
scheduled or increasing the interest rate applicable thereto or change any
subordination provision thereof, (b) during the existence of a Default or Event
of Default, or if a Default or Event of Default would be caused as a result
thereof make (or give any notice with respect thereto) any voluntary or optional
payment or prepayment or redemption or acquisition for value of (including,
without limitation, by way of depositing money or securities with the trustee
with respect thereto before due for the purpose of paying when due), refund,
refinance or exchange of any other Indebtedness.
8.11 Subordinated Debt.
(a) No Credit Party will (i) make or offer to make any principal
payments with respect to the Subordinated Debt, (ii) redeem or offer to redeem
any of the Subordinated Debt, or (iii) deposit any funds intended to discharge
or defease any or all of the Subordinated Debt. The Subordinated Debt may not be
amended or modified in any material manner without the prior written consent of
the Required Lenders, it being specifically understood and agreed that no
amendment to Article 4 or Article 10 of the Indenture shall be made without the
prior written consent of the Required Lenders.
(b) No Credit Party will (i) make or offer to make any principal
payments with respect to the Additional Subordinated Debt, (ii) redeem or offer
to redeem any of the Additional Subordinated Debt, or (iii) deposit any funds
intended to discharge or defease any or all of the Additional Subordinated Debt.
The Additional Subordinated Debt may not be amended or modified in any material
manner without the prior written consent of the Required Lenders.
8.12 Limitations.
No Credit Party will, nor will it permit any of its Subsidiaries to,
directly or indirectly, create or otherwise cause, incur, assume, suffer or
permit to exist or become effective any consensual encumbrance or restriction of
any kind on the ability of any such Person to (a) pay dividends or make any
other distribution on any of such Person's capital stock, (b) pay any
Indebtedness owed to the Borrower or any other Credit Party, (c) make loans or
advances to any other Credit Party or (d) transfer any of its property to any
other Credit Party, except for encumbrances or restrictions existing under or by
reason of (i) customary non-assignment provisions in any lease governing a
leasehold interest, (ii) this Credit Agreement, the other Supplemental Credit
Documents and the New Credit Agreement Documents and (iii) the Indenture.
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8.13 Sale Leasebacks.
No Credit Party will, nor will it permit any of its Subsidiaries to,
directly or indirectly become or remain liable as lessee or as guarantor or
other surety with respect to any lease, of any property (whether real or
personal or mixed), whether now owned or hereafter acquired, (a) which such
Credit Party or Subsidiary has sold or transferred or is to sell or transfer to
any other Person other than a Credit Party or (b) which such Credit Party or
Subsidiary intends to use for substantially the same purpose as any other
property which has been sold or is to be sold or transferred by such Credit
Party or Subsidiary to any Person in connection with such lease.
8.14 Negative Pledges.
Other than as set forth in Section 4.12 of the Indenture, none of the
Credit Parties will, nor will it permit any of its Subsidiaries to, enter into,
assume or become subject to any agreement prohibiting or otherwise restricting
the creation or assumption of any Lien upon its properties or assets, whether
now owned or hereafter acquired, or requiring the grant of any security for such
obligation if security is given for some other obligation.
8.15 Capital Expenditures.
The Credit Parties and their Subsidiaries will not make Capital
Expenditures, in any fiscal year, that would exceed $3,500,000.00 in the
aggregate.
8.16 Operating Leases.
Neither the Borrower nor any of its Subsidiaries shall create, incur,
assume or permit to exist obligations under Operating Leases which require
aggregate annual payments in excess of $1,500,000.00.
8.17 Payment Blockage Notice.
(a) The Borrower (i) covenants and agrees that it will not give the
Payment Blockage Notice (as defined in the Indenture) without the consent of the
Required Lenders and (ii) hereby designates and appoints the Agent, as
attorney-in-fact of the Borrower, irrevocably and with full power of
substitution, to deliver any Payment Blockage Notice that the Borrower has the
right to deliver pursuant to the terms of the Indenture; provided that the
foregoing appointment shall terminate at such time as the Loans, together with
interest, fees and other obligations hereunder, have been paid in full and the
Commitments hereunder shall have terminated.
(b) The Borrower (i) covenants and agrees that it will not give the
Payment Blockage Notice (as defined in the Second Indenture) without the consent
of the Required Lenders and (ii) hereby designates and appoints the Agent, as
attorney-in-fact of the Borrower, irrevocably and with full power of
substitution, to deliver any Payment Blockage Notice (as defined in the Second
Indenture) that the Borrower has the right to deliver pursuant to the terms of
the Second Indenture; provided that the foregoing appointment shall terminate at
such time as the Loans,
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together with interest, fees and other obligations hereunder, have been paid in
full and the Commitments hereunder shall have terminated.
SECTION 9
EVENTS OF DEFAULT
9.1 Events of Default.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Payment. Any Credit Party shall:
(i) default in the payment when due of any
principal of any of the Tranche A Term Loans or Tranche B
Term Loans; or
(ii) default, and such default shall continue for
three or more days, in the payment when due of any interest on
the Tranche A Term Loans or Tranche B Term Loans, or of any
fees or other amounts owing hereunder, under any of the other
Supplemental Credit Documents or in connection herewith.
(b) Representations. Any representation, warranty or statement
made or deemed to be made by any Credit Party herein, in any of the
other Supplemental Credit Documents, or in any statement or certificate
delivered or required to be delivered pursuant hereto or thereto shall
prove untrue in any material respect on the date as of which it was
made or deemed to have been made.
(c) Covenants. Any Credit Party shall:
(i) default in the due performance or observance of
any term, covenant or agreement contained in Sections 7.2,
7.4, 7.5, 7.6, 7.9, 7.10, 7.12, 7.13, 7.14, 7.15, 7.16 or 8.1
through 8.17 inclusive; or
(ii) default in the due performance or observance by
it of any term, covenant or agreement contained in Section 7.1
and such default shall continue unremedied for a period of
five Business Days after the earlier of an officer of a Credit
Party becoming aware of such default or notice thereof given
by the Agent; or
(iii) default in the due performance or observance by
it of any term, covenant or agreement (other than those
referred to in subsections (a), (b) or (c)(i) or (ii) of this
Section 9.1) contained in this Credit Agreement and such
default shall continue unremedied for a period of at least 30
days after the earlier of an officer of a Credit Party
becoming aware of such default or notice thereof given by the
Agent.
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(d) Other Credit Documents. (i) Any Credit Party shall default
in the due performance or observance of any term, covenant or agreement
in any of the other Supplemental Credit Documents and such default
shall continue unremedied for a period of at least 30 days after the
earlier of an officer of a Credit Party becoming aware of such default
or notice thereof given by the Agent, or (ii) any Supplemental Credit
Documents shall fail to be in full force and effect or to give the
Agent and/or the Supplemental Credit Lenders the security interests,
liens, rights, powers and privileges purported to be created thereby.
(e) Guaranties. The guaranty given by the Credit Parties
hereunder or by any Additional Credit Party hereafter or any provision
thereof shall cease to be in full force and effect, or any guarantor
thereunder or any Person acting by or on behalf of such guarantor shall
deny or disaffirm such Guarantor's obligations under such guaranty.
(f) Bankruptcy, etc. The occurrence of any of the following
with respect to the Borrower or any of its Subsidiaries (i) a court or
governmental agency having jurisdiction in the premises shall enter a
decree or order for relief in respect of the Borrower or any of its
Subsidiaries in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or appoint
a receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar official of any of the Borrower or any of its Subsidiaries or
for any substantial part of its property or ordering the winding up or
liquidation of its affairs; or (ii) an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter
in effect is commenced against the Borrower or any of its Subsidiaries
and such petition remains unstayed and in effect for a period of 60
consecutive days; or (iii) the Borrower or any of its Subsidiaries
shall commence a voluntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or consent
to the entry of an order for relief in an involuntary case under any
such law, or consent to the appointment or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar official of such Person or any substantial part of its property
or make any general assignment for the benefit of creditors; or (iv)
the Borrower or any of its Subsidiaries shall admit in writing its
inability to pay its debts generally as they become due or any action
shall be taken by such Person in furtherance of any of the aforesaid
purposes.
(g) Defaults under Other Agreements. With respect to any
Indebtedness (other than Indebtedness outstanding under this Credit
Agreement) of the Borrower or any of its Subsidiaries in a principal
amount in excess of $500,000.00, including, without limitation, the
Subordinated Debt, the Additional Subordinated Debt and any
indebtedness under the New Credit Agreement (i) a Credit Party shall
(A) default in any payment (beyond the applicable grace period with
respect thereto, if any) with respect to any such Indebtedness, or (B)
default (after giving effect to any applicable grace period) in the
observance or performance of any term, covenant or agreement relating
to such Indebtedness or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event or
condition shall occur or condition exist, the effect of which default
or other event or condition is to cause, or permit, the holder or
holders of such Indebtedness (or trustee or agent on behalf of such
holders) to cause (determined without regard to whether any notice or
lapse of time is required) any such Indebtedness to become due prior to
its stated
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maturity; or (ii) any such Indebtedness shall be declared due and
payable, or required to be prepaid other than by a regularly scheduled
required prepayment, prior to the stated maturity thereof.
(h) Judgments. One or more judgments, orders, or decrees shall
be entered against any one or more of the Borrower or any of its
Subsidiaries involving a liability of $500,000.00 or more, in the
aggregate, (to the extent not paid or covered by insurance provided by
a carrier who has acknowledged coverage) and such judgments, orders or
decrees shall continue unsatisfied, undischarged and unstayed for a
period ending on the first to occur of (i) the last day on which such
judgment, order or decree becomes final and unappealable or (ii) 30
days.
(i) ERISA. Any of the following events or conditions: (A) any
"accumulated funding deficiency," as such term is defined in Section
302 of ERISA and Section 412 of the Code, whether or not waived, shall
exist with respect to any Plan, or any lien shall arise on the assets
of the Borrower or any of their Subsidiaries or any ERISA Affiliate in
favor of the PBGC or a Plan; (B) a Termination Event shall occur with
respect to a Single Employer Plan, which is, in the reasonable opinion
of the Agent, likely to result in the termination of such Plan for
purposes of Title IV of ERISA; (C) a Termination Event shall occur with
respect to a Multiemployer Plan or Multiple Employer Plan, which is, in
the reasonable opinion of the Agent, likely to result in (i) the
termination of such Plan for purposes of Title IV of ERISA, or (ii) the
Borrower or any of its Subsidiaries or any ERISA Affiliate incurring
any liability in connection with a withdrawal from, reorganization of
(within the meaning of Section 4241 of ERISA), or insolvency or (within
the meaning of Section 4245 of ERISA) such Plan; or (D) any prohibited
transaction (within the meaning of Section 406 of ERISA or Section 4975
of the Code) or breach of fiduciary responsibility shall occur which
may subject the Borrower or any of its Subsidiaries or any ERISA
Affiliate to any liability under Sections 406, 409, 502(i), or 502(l)
of ERISA or Section 4975 of the Code, or under any agreement or other
instrument pursuant to which the Borrower or any of its Subsidiaries or
any ERISA Affiliate has agreed or is required to indemnify any person
against any such liability;
(j) Ownership. There shall occur a Change of Control;
(k) Subordinated Debt. (i) Any holder of the Subordinated Debt
alleges (or any Governmental Authority with applicable jurisdiction
determines) that the Supplemental Credit Lenders or New Credit
Agreement Lenders are not holders of Senior Debt (as defined in the
Indenture) or (ii) the subordination provisions in the Indenture shall,
in whole or in part, terminate, cease to be effective or cease to be
legally valid, binding and enforceable against any holder of the
Subordinated Debt;
(l) Additional Subordinated Debt. (i) Any holder of the
Additional Subordinated Debt alleges (or any Governmental Authority
with applicable jurisdiction determines) that the Supplemental Credit
Lenders or New Credit Agreement Lenders are not holders of Senior
Indebtedness (as defined in the Second Indenture) or (ii) the
subordination provisions in the Second Indenture shall, in whole or in
part, terminate, cease
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to be effective or cease to be legally valid, binding and enforceable
against any holder of the Additional Subordinated Debt.
(m) Business. The Borrower commences to engage in any material
respect in a line of business or activity other than the business of
manufacturing and marketing of brand name over-the-counter
pharmaceuticals, dietary supplements, functional toiletries and
cosmetics; or
(n) Indenture/Change of Control. There shall occur (i) a
Change of Control (as defined in the Indenture) under the Indenture,
(ii) a Change of Control Triggering Event (as defined in the Indenture)
under the Indenture or (iii) a Change of Control (as defined in the
Second Indenture) under the Second Indenture.
9.2 Acceleration; Remedies.
Upon the occurrence of an Event of Default, and at any time thereafter
unless and until such Event of Default has been waived in writing by the
Required Lenders (or the Lenders as may be required hereunder), the Agent shall,
upon the request and direction of the Required Lenders, by written notice to the
Borrower, take any of the following actions:
(a) Acceleration of Loans. Declare the unpaid principal of and
any accrued interest in respect of all Tranche A Term Loans and Tranche
B Term Loans, and any and all other indebtedness or obligations of any
and every kind owing by a Credit Party to any of the Supplemental
Credit Lenders hereunder to be due whereupon the same shall be
immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Credit
Parties.
(b) Enforcement of Rights. Enforce any and all rights and
interests created and existing under the Supplemental Credit Documents,
including, without limitation, all rights and remedies existing under
the Collateral Documents, all rights and remedies against a Guarantor
and all rights of set-off.
Notwithstanding the foregoing, if an Event of Default specified in Section
9.1(f) shall occur, then all Tranche A Term Loans and Tranche B Term Loans, all
accrued interest in respect thereof, all accrued and unpaid fees and other
indebtedness or obligations owing to the Lenders hereunder shall immediately
become due and payable without the giving of any notice or other action by the
Agent or the Lenders, which notice or other action is expressly waived by the
Credit Parties.
Notwithstanding the fact that enforcement powers reside primarily with the
Agent, each Supplemental Credit Lender has a separate right of payment and shall
be considered a separate "creditor" holding a separate "claim" within the
meaning of Section 101(5) of the Bankruptcy Code or any other insolvency
statute.
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SECTION 10
AGENCY PROVISIONS
10.1 Appointment.
Each Supplemental Credit Lender hereby designates and appoints
NationsBank of Tennessee, N.A. as Agent of such Supplemental Credit Lender to
act as specified herein and the other Supplemental Credit Documents, and each
such Supplemental Credit Lender hereby authorizes the Agent, as the agent for
such Supplemental Credit Lender, to take such action on its behalf under the
provisions of this Credit Agreement and the other Supplemental Credit Documents
and to exercise such powers and perform such duties as are expressly delegated
by the terms hereof and of the other Supplemental Credit Documents, together
with such other powers as are reasonably incidental thereto. Notwithstanding any
provision to the contrary elsewhere herein and in the other Supplemental Credit
Documents, the Agent shall not have any duties or responsibilities, except those
expressly set forth herein and therein, or any fiduciary relationship with any
Supplemental Credit Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Credit Agreement or any of the other Supplemental Credit Documents, or shall
otherwise exist against the Agent. The provisions of this Section are solely for
the benefit of the Agent and the Supplemental Credit Lenders and none of the
Credit Parties shall have any rights as a third party beneficiary of the
provisions hereof. In performing its functions and duties under this Credit
Agreement and the other Supplemental Credit Documents, the Agent shall act
solely as the agent of the Supplemental Credit Lenders and does not assume and
shall not be deemed to have assumed any obligation or relationship of agency or
trust with or for any Credit Party.
10.2 Delegation of Duties.
The Agent may execute any of its duties hereunder or under the other
Supplemental Credit Documents by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. The Agent shall not be responsible for the negligence or misconduct of
any agents or attorneys-in-fact selected by it with reasonable care.
10.3 Exculpatory Provisions.
Neither the Agent nor any of its officers, directors, employees,
agents, attorneys-in-fact or affiliates shall be (a) liable for any action
lawfully taken or omitted to be taken by it or such Person under or in
connection herewith or in connection with any of the other Supplemental Credit
Documents (except for its or such Person's own gross negligence or willful
misconduct) or (b) responsible in any manner to any of the Supplemental Credit
Lenders for any recitals, statements, representations or warranties made by any
of the Credit Parties contained herein or in any of the other Supplemental
Credit Documents or in any certificate, report, document, financial statement or
other written or oral statement referred to or provided for in, or received by
the Agent under or in connection herewith or in connection with the other
Supplemental Credit Documents, or enforceability or sufficiency therefor of any
of the other Supplemental Credit Documents, or for any failure of the Borrower
to perform its obligations hereunder or thereunder. The Agent shall not be
responsible to any Supplemental Credit Lender for the effectiveness,
genuineness, validity,
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enforceability, collectibility or sufficiency of this Credit Agreement, or any
of the other Supplemental Credit Documents or for any representations,
warranties, recitals or statements made herein or therein or made by the
Borrower or any Credit Party in any written or oral statement or in any
financial or other statements, instruments, reports, certificates or any other
documents in connection herewith or therewith furnished or made by the Agent to
the Supplemental Credit Lenders or by or on behalf of the Credit Parties to the
Agent or any Supplemental Credit Lender or be required to ascertain or inquire
as to the performance or observance of any of the terms, conditions, provisions,
covenants or agreements contained herein or therein or as to the use of the
proceeds of the Tranche A Term Loans, Tranche B Term Loans or of the existence
or possible existence of any Default or Event of Default or to inspect the
properties, books or records of the Credit Parties. The Agent is not a trustee
for the Supplemental Credit Lenders and owes no fiduciary duty to the
Supplemental Credit Lenders.
10.4 Reliance on Communications.
The Agent shall be entitled to rely, and shall be fully protected in
relying, upon any note, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order or other document or conversation believed by it to be genuine
and correct and to have been signed, sent or made by the proper Person or
Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to any of the Credit Parties, independent accountants and
other experts selected by the Agent with reasonable care). The Agent may deem
and treat the Supplemental Credit Lenders as the owner of its interests
hereunder for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Agent in accordance with Section
11.3(b). The Agent shall be fully justified in failing or refusing to take any
action under this Credit Agreement or under any of the other Supplemental Credit
Documents unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action. The
Agent shall in all cases be fully protected in acting, or in refraining from
acting, hereunder or under any of the other Supplemental Credit Documents in
accordance with a request of the Required Lenders (or to the extent specifically
provided in Section 11.6, all the Lenders) and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders
(including their successors and assigns).
10.5 Notice of Default.
The Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default hereunder unless the Agent has
received notice from a Supplemental Credit Lender or a Credit Party referring to
the Supplemental Credit Documents, describing such Default or Event of Default
and stating that such notice is a "notice of default." In the event that the
Agent receives such a notice, the Agent shall give prompt notice thereof to the
Lenders. The Agent shall take such action with respect to such Default or Event
of Default as shall be reasonably directed by the Required Lenders.
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10.6 Non-Reliance on Agent and Other Lenders.
Each Supplemental Credit Lender expressly acknowledges that neither the
Agent nor any of its officers, directors, employees, agents, attorneys-in-fact
or affiliates has made any representations or warranties to it and that no act
by the Agent or any affiliate thereof hereinafter taken, including any review of
the affairs of any Credit Party, shall be deemed to constitute any
representation or warranty by the Agent to any Supplemental Credit Lender. Each
Supplemental Credit Lender represents to the Agent that it has, independently
and without reliance upon the Agent or any other Supplemental Credit Lender, and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the business, assets, operations,
property, financial and other conditions, prospects and creditworthiness of the
Credit Parties and made its own decision to make its Tranche A Term Loans and
Tranche B Term Loans hereunder and enter into this Credit Agreement. Each
Supplemental Credit Lender also represents that it will, independently and
without reliance upon the Agent or any other Supplemental Credit Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Credit Agreement, and to make such
investigation as it deems necessary to inform itself as to the business, assets,
operations, property, financial and other conditions, prospects and
creditworthiness of the Credit Parties. Except for notices, reports and other
documents expressly required to be furnished to the Supplemental Credit Lenders
by the Agent hereunder, the Agent shall not have any duty or responsibility to
provide any Supplemental Credit Lender with any credit or other information
concerning the business, operations, assets, property, financial or other
conditions, prospects or creditworthiness of the Credit Parties which may come
into the possession of the Agent or any of its officers, directors, employees,
agents, attorneys-in-fact or affiliates.
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10.7 Indemnification.
The Supplemental Credit Lenders agree to indemnify the Agent in its
capacity as such (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), ratably according to their
respective percentage of the Tranche A Term Loan Committed Amount and Tranche B
Term Loan Committed Amount, collectively, (or if the Tranche A Term Loan
Committed Amount and Tranche B Term Loan Committed Amount has expired or been
terminated, in accordance with the respective aggregate principal amounts of
outstanding Tranche A Term Loans and Tranche B Term Loans and Participation
Interest of the Supplemental Credit Lenders), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including without limitation at any time following payment in full of the
Credit Party Obligations) be imposed on, incurred by or asserted against the
Agent in its capacity as such in any way relating to or arising out of this
Credit Agreement or the other Supplemental Credit Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the Agent under
or in connection with any of the foregoing; provided that no Supplemental Credit
Lender shall be liable for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the gross negligence or willful
misconduct of the Agent. If any indemnity furnished to the Agent for any purpose
shall, in the opinion of the Agent, be insufficient or become impaired, the
Agent may call for additional indemnity and cease, or not commence, to do the
acts indemnified against until such additional indemnity is furnished. The
agreements in this Section shall survive the payment of the Credit Party
Obligations and all other amounts payable hereunder and under the other
Supplemental Credit Documents.
10.8 Agent in Its Individual Capacity.
The Agent and its affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower or any other
Credit Party as though the Agent were not the Agent hereunder. With respect to
the Tranche A Term Loans and Tranche B Term Loans made and all obligations owing
to it, the Agent shall have the same rights and powers under this Credit
Agreement as any Supplemental Credit Lender and may exercise the same as though
it were not the Agent, and the terms "Lender", "Lenders", "Supplemental Credit
Lender" and "Supplemental Credit Lenders" shall include the Agent in its
individual capacity.
10.9 Successor Agent.
The Agent may, at any time, resign upon 20 days written notice to the
Supplemental Credit Lenders. Upon any such resignation, the Required Lenders
shall have the right to appoint a successor Agent. If no successor Agent shall
have been so appointed by the Required Lenders, and shall have accepted such
appointment, within 45 days after the notice of resignation, then the retiring
Agent shall select a successor Agent provided such successor is a Supplemental
Credit Lender hereunder or a commercial bank organized under the laws of the
United States of America or of any State thereof and has a combined capital and
surplus of at least $400,000,000. Upon the acceptance of any appointment as the
Agent hereunder by a successor, such successor Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations as an
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Agent, as appropriate, under this Credit Agreement and the other Supplemental
Credit Documents and the provisions of this Section 10.9 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was the
Agent under this Credit Agreement.
SECTION 11
MISCELLANEOUS
11.1 Notices.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device) to the
number set out below, (c) the Business Day following the day on which the same
has been delivered prepaid to a reputable national overnight air courier
service, or (d) the third Business Day following the day on which the same is
sent by certified or registered mail, postage prepaid, in each case to the
respective parties at the address or telecopy numbers set forth on Schedule
11.1, or at such other address as such party may specify by written notice to
the other parties hereto.
11.2 Right of Set-Off.
In addition to any rights now or hereafter granted under applicable law
or otherwise, and not by way of limitation of any such rights, upon the
occurrence of an Event of Default and the commencement of remedies described in
Section 9.2, each Supplemental Credit Lender is authorized at any time and from
time to time, without presentment, demand, protest or other notice of any kind
(all of which rights being hereby expressly waived), to set-off and to
appropriate and apply any and all deposits (general or special) and any other
indebtedness at any time held or owing by such Supplemental Credit Lender
(including, without limitation branches, agencies or Affiliates of such
Supplemental Credit Lender wherever located) to or for the credit or the account
of any Credit Party against obligations and liabilities of such Credit Party to
the Supplemental Credit Lenders hereunder, under the Tranche A Term Loan Notes,
under the Tranche B Term Loan Notes, the other Supplemental Credit Documents or
otherwise, irrespective of whether the Agent or the Supplemental Credit Lenders
shall have made any demand hereunder and although such obligations, liabilities
or claims, or any of them, may be contingent or unmatured, and any such set-off
shall be deemed to have been made immediately upon the occurrence of an Event of
Default even though such charge is made or entered on the books of such Lender
subsequent thereto. The Credit Parties hereby agree that any Person purchasing a
participation in the Tranche A Term Loans and the Tranche A Term Loan Committed
Amount and/or Tranche B Term Loans and Tranche B Term Loan Committed Amount
hereunder pursuant to Section 11.3(c) or 3.9 may exercise all rights of set-off
with respect to its participation interest as fully as if such Person were a
Supplemental Credit Lender hereunder.
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11.3 Benefit of Agreement.
(a) Generally. This Credit Agreement shall be binding upon and
inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto; provided that none of the Credit
Parties may assign and transfer any of its interests without the prior
written consent of the Lenders; and provided further that the rights of
each Supplemental Credit Lender to transfer, assign or grant
participations in its rights and/or obligations hereunder shall be
limited as set forth in this Section 11.3. Notwithstanding the above,
nothing herein shall restrict, prevent or prohibit any Supplemental
Credit Lender from (i) pledging its Tranche A Term Loans and/or Tranche
B Term Loans hereunder to a Federal Reserve Bank in support of
borrowings made by such Supplemental Credit Lender from such Federal
Reserve Bank, or (ii) granting assignments or participation in such
Supplemental Credit Lender's Tranche A Term Loans and/or Tranche A Term
Committed Amount or Tranche B Term Loans and/or Tranche B Term Loan
Committed Amount hereunder to its parent company and/or to any
Affiliate of such Supplemental Credit Lender or to any existing Lender
or Affiliate thereof.
(b) Assignments. Each Supplemental Credit Lender may, with the
prior written consent of the Borrower and the Agent (provided that no
consent of the Borrower shall be required during the existence and
continuation of an Event of Default), which consent shall not be
unreasonably withheld or delayed, assign all or a portion of its rights
and obligations hereunder pursuant to an assignment agreement
substantially in the form of Exhibit 11.3 to one or more Eligible
Assignees; provided that (i) any such assignment shall be in a minimum
aggregate amount of $5,000,000 of (A) (I) the Revolving Loans, Tranche
A Term Loans and Tranche A Term Loans or (II) the Revolving Committed
Amount, Tranche A Term Loan Committed Amount and Tranche A Supplemental
Term Loan Committed Amount or (B) Tranche B Term Loans, as applicable,
and in integral multiples of $1,000,000 above such amount (or the
remaining amount of (C) (I) the Revolving Loans and Tranche A Term
Loans or (II) the Revolving Committed Amount and Tranche A Term Loan
Committed Amount or (D) Tranche B Term Loans, as applicable, held by
such Supplemental Credit Lender), (ii) each such assignment shall be of
a constant, not varying, percentage of all of the assigning
Supplemental Credit Lender's rights and obligations under the Tranche A
Term Loans or Tranche B Term Loans, as applicable, being assigned and
(iii) unless otherwise agreed to by the Borrower and the Agent, such
Supplemental Credit Lender proposing to assign all or a portion of the
Tranche A Term Loan Committed Amount or Tranche B Term Loan Committed
Amount shall be required to assign to such Eligible Assignee or
Assignees (to the extent held by such Supplemental Credit Lender) an
identical percentage of Revolving Committed Amount, Tranche A Term Loan
Committed Amount and Tranche B Term Loan Committed Amount of such
Supplemental Credit Lender. Any assignment hereunder shall be effective
upon (i) satisfaction of the conditions set forth above, (ii) delivery
to the Agent of a duly executed assignment agreement together with a
transfer fee of $3,500 payable to the Agent for its own account and
(iii) the recordation of an appropriate entry with respect to such
assignment in the Register pursuant to this Section 11.3. Upon the
effectiveness of any such assignment, the assignee shall become a
"Supplemental Credit Lender" for all purposes of this Credit Agreement
and the other Supplemental Credit Documents and, to the extent of such
assignment, the assigning Supplemental Credit Lender shall be relieved
of its obligations hereunder to the extent of
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the Tranche A Term Loans and Tranche A Term Loan Committed Amount or
Tranche B Term Loans and Tranche B Supplemental Term Loan Committed
Amount components being assigned. Along such lines the Borrower agrees
that upon notice of any such assignment and surrender of the
appropriate Tranche A Term Loan Note or Tranche A Term Loan Notes
and/or Tranche B Term Loan Note or Tranche B Term Loan Notes, it will
promptly provide to the assigning Supplemental Credit Lender and to the
assignee separate promissory notes in the amount of their respective
interests substantially in the form of the original Tranche A Term Loan
Note or Tranche A Term Loan Notes and/or Tranche B Term Loan Note or
Tranche B Term Loan Notes (but with notation thereon that it is given
in substitution for and replacement of the original Tranche A Term Loan
Note or Tranche A Term Notes and/or Tranche B Term Loan Note or Tranche
B Term Loan Notes or any replacement notes thereof).
By executing and delivering an assignment agreement in accordance with
this Section 11.3(b), the assigning Supplemental Credit Lender
thereunder and the assignee thereunder shall be deemed to confirm to
and agree with each other and the other parties hereto as follows: (i)
such assigning Supplemental Credit Lender warrants that it is the legal
and beneficial owner of the interest being assigned thereby free and
clear of any adverse claim; (ii) except as set forth in clause (i)
above, such assigning Supplemental Credit Lender makes no
representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in
connection with this Credit Agreement, any of the other Supplemental
Credit Documents or any other instrument or document furnished pursuant
hereto or thereto, or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Credit
Agreement, any of the other Supplemental Credit Documents or any other
instrument or document furnished pursuant hereto or thereto or the
financial condition of any Credit Party or the performance or
observance by any Credit Party of any of its obligations under this
Credit Agreement, any of the other Supplemental Credit Documents or any
other instrument or document furnished pursuant hereto or thereto;
(iii) such assignee represents and warrants that it is legally
authorized to enter into such assignment agreement; (iv) such assignee
confirms that it has received a copy of this Credit Agreement, the
other Supplemental Credit Documents and such other documents and
information as it has deemed appropriate to make its own credit
analysis and decision to enter into such assignment agreement; (v) such
assignee will independently and without reliance upon the Agent, such
assigning Supplemental Credit Lender or any other Supplemental Credit
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 Credit Agreement and the other
Supplemental Credit Documents; (vi) such assignee appoints and
authorizes the Agent to take such action on its behalf and to exercise
such powers under this Credit Agreement or any other Supplemental
Credit Documents as are delegated to the Agent by the terms hereof or
thereof, together with such powers as are reasonably incidental
thereto; and (vii) such assignee agrees that it will perform in
accordance with their terms all the obligations which by the terms of
this Credit Agreement and the other Supplemental Credit Documents are
required to be performed by it as a Supplemental Credit Lender.
(c) Participations. Each Supplemental Credit Lender may sell,
transfer, grant or assign participations in all or any part of such
Supplemental Credit Lender's interests and
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obligations hereunder; provided that (i) such selling Supplemental
Credit Lender shall remain a "Supplemental Credit Lender" for all
purposes under this Credit Agreement (such selling Supplemental Credit
Lender's obligations under the Credit Documents remaining unchanged)
and the participant shall not constitute a Supplemental Credit Lender
hereunder, (ii) no such participant shall have, or be granted, rights
to approve any amendment or waiver relating to this Credit Agreement,
or the other Supplemental Credit Documents except to the extent any
such amendment or waiver would (A) reduce the principal of or rate of
interest on or fees in respect of any Tranche A Term Loans or Tranche B
Term Loans in which the participant is participating, (B) postpone the
date fixed for any payment of principal (including extension of the
Tranche A Term Loan Maturity Date or Tranche B Term Loan Maturity Date
or the date of any mandatory prepayment), interest or fees in which the
participant is participating, or (C) release all or substantially all
of the collateral or guaranties (except as expressly provided in the
Supplemental Credit Documents) supporting any of the Tranche A Term
Loans or Tranche A Term Loan Committed Amount or Tranche B Term Loans
or Tranche B Term Loan Committed Amount in which the participant is
participating, (iii) sub-participations by the participant (except to
an Affiliate, parent company or Affiliate of a parent company of the
participant) shall be prohibited, (iv) any such participations shall be
in a minimum aggregate amount of $5,000,000 of the (A) (I) Revolving
Loans and Tranche A Term Loans or (II) the Revolving Committed Amount
and Tranche A Term Loan Committed Amount or (B) Tranche B Term Loans,
as applicable, and in integral multiples of $1,000,000 in excess
thereof and (v) unless otherwise agreed to by the Borrower and the
Agent, such selling Supplemental Credit Lender proposing to grant or
assign a participation in Tranche A Term Loans or Tranche B Term Loans
shall be required to grant or assign a participation to such
participant, in like percentage, of Tranche A Term Loans, Tranche B
Term Loans and Revolving Loan Committed Amount, as applicable, of such
Supplemental Credit Lender. In the case of any such participation, the
participant shall not have any rights under this Credit Agreement or
the other Supplemental Credit Documents (the participant's rights
against the selling Supplemental Credit Lender in respect of such
participation to be those set forth in the participation agreement with
such Supplemental Credit Lender creating such participation) and all
amounts payable by the Borrower hereunder shall be determined as if
such Supplemental Credit Lender had not sold such participation;
provided, however, that such participant shall be entitled to receive
additional amounts under Section 3.15 to the same extent that the
Supplemental Credit Lender from which such participant acquired its
participation would be entitled to the benefit of such cost protection
provisions.
(d) Registration. The Agent, acting for this purpose solely on
behalf of the Borrower, shall maintain a register (the "Register") for
the recordation of the names and addresses of the Supplemental Credit
Lenders and the principal amount of the Tranche A Term Loans and/or
Tranche B Term Loans owing to each Supplemental Credit Lender from time
to time. The entries in the Register shall be conclusive, in the
absence of manifest error, and the Borrower, the Agent and the
Supplemental Credit Lenders shall treat each Person whose name is
recorded in the Register as the owner of a Tranche A Term Loan and/or
Tranche B Term Loan or other obligation hereunder for all purposes of
this Credit Agreement and the other Supplemental Credit Documents,
notwithstanding notice to the contrary. Any assignment of any Tranche A
Term Loan or Tranche B Term Loan or other obligation hereunder shall be
effective only upon appropriate entries with respect thereto
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being made in the Register. The Register shall be available for
inspection by the Borrower or any Supplemental Credit Lender at any
reasonable time and from time to time upon reasonable prior notice.
11.4 No Waiver; Remedies Cumulative.
No failure or delay on the part of the Agent or any Supplemental Credit
Lender in exercising any right, power or privilege hereunder or under any other
Supplemental Credit Documents and no course of dealing between the Borrower or
any Credit Party and the Agent or any Supplemental Credit Lender shall operate
as a waiver thereof; nor shall any single or partial exercise of any right,
power or privilege hereunder or under any other Supplemental Credit Documents
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege hereunder or thereunder. The rights and remedies
provided herein are cumulative and not exclusive of any rights or remedies which
the Agent or any Supplemental Credit Lender would otherwise have. No notice to
or demand on any Credit Party in any case shall entitle any Credit Party to any
other or further notice or demand in similar or other circumstances or
constitute a waiver of the rights of the Agent or the Supplemental Credit
Lenders to any other or further action in any circumstances without notice or
demand.
11.5 Payment of Expenses; Indemnification.
The Credit Parties agree to: (a) pay all reasonable out-of-pocket costs
and expenses of (i) the Agent in connection with the negotiation, preparation,
execution and delivery and administration of this Credit Agreement and the other
Supplemental Credit Documents and the documents and instruments referred to
therein (including, without limitation, the reasonable fees and expenses of
Xxxxx & Xxx Xxxxx, special counsel to the Agent and the fees and expenses of
counsel for the Agent in connection with collateral or foreign issues), and any
amendment, waiver or consent relating hereto and thereto including, but not
limited to, any such amendments, waivers or consents resulting from or related
to any work-out, renegotiation or restructure relating to the performance by the
Credit Parties under this Credit Agreement and (ii) the Agent and the
Supplemental Credit Lenders in connection with enforcement of the Supplemental
Credit Documents and the documents and instruments referred to therein
(including, without limitation, in connection with any such enforcement, the
reasonable fees and disbursements of counsel for the Agent and each of the
Supplemental Credit Lenders) and (b) indemnify each Supplemental Credit Lender,
its officers, directors, employees, representatives and agents from and hold
each of them harmless against any and all losses, liabilities, claims, damages
or expenses incurred by any of them as a result of, or arising out of, or in any
way related to, or by reason of, any investigation, litigation or other
proceeding (whether or not any Supplemental Credit Lender is a party thereto)
related to (i) the entering into and/or performance of any Supplemental Credit
Documents or the use of proceeds of any Tranche A Term Loans or Tranche B Term
Loans (including other extensions of credit) hereunder or the consummation of
any other transactions contemplated in any Supplemental Credit Documents,
including, without limitation, the reasonable fees and disbursements of counsel
incurred in connection with any such investigation, litigation or other
proceeding (but excluding any such losses, liabilities, claims, damages or
expenses to the extent incurred by reason of gross negligence or willful
misconduct on the part of the Person to be indemnified), (ii) any Environmental
Claim and (iii) any claims for Non-Excluded Taxes.
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11.6 Amendments, Waivers and Consents.
Neither this Credit Agreement, nor any other Credit Document, nor any
of the terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing and signed by the Required Lenders and the Credit Parties; provided that
no such amendment, change, waiver, discharge or termination shall
(a) without the consent of each Lender affected thereby:
(i) extend the final maturity of any Tranche A
Term Loan or Tranche B Term Loan, or any portion thereof,
(ii) reduce the rate or extend the time of
payment of interest (other than as a result of waiving the
applicability of any post-default increase in interest rates)
thereon or fees hereunder,
(iii) reduce or waive the principal amount of any
Tranche A Term Loan or Tranche B Term Loan,
(iv) increase the Commitment of a Lender over
the amount thereof in effect (it being understood and agreed
that a waiver of any Default or Event of Default or mandatory
reduction in the Commitments shall not constitute a change in
the terms of any Commitment of any Lender),
(v) release all or substantially all of the
Collateral securing the Credit Party Obligations hereunder
(provided that the Agent may, without consent from any other
Lender, release any Collateral that is sold or transferred by
a Credit Party in conformance with Section 8.5),
(vi) release the Borrower or substantially all
of the other Credit Parties from its obligations under the
Credit Documents,
(vii) amend, modify or waive any provision of
this Section or Section 3.7, 3.9, 3.10, 3.11, 3.12, 3.13,
3.14, 3.15, 9.1(a), 11.2, 11.3 or 11.5,
(viii) reduce any percentage specified in, or
otherwise modify, the definition of Required Lenders, or
(ix) consent to the assignment or transfer by
the Borrower (or another Credit Party) of any of its rights
and obligations under (or in respect of) the Credit Documents
except as permitted thereby; and
(b) without the consent of Lenders holding in the aggregate
more than 50% of the Tranche A Term Loans and more than 50% of the
outstanding Tranche B Term Loans, extend the time for or the amount or
the manner of application of proceeds of any mandatory prepayment
required by Section 3.3(b)(ii), (iii), (iv), (v) or (vi) hereof. No
provision of Section 11 may be amended without the consent of the
Agent.
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(c) Notwithstanding the above, the right to deliver a Payment
Blockage Notice (as defined in the Indenture) shall reside solely with
the Agent, and the Agent shall deliver such Payment Blockage Notice
only upon the direction of the Required Lenders.
(d) Notwithstanding the fact that the consent of all the
Lenders is required in certain circumstances as set forth above, (x)
each Lender is entitled to vote as such Lender sees fit on any
bankruptcy reorganization plan that affects the Tranche A Term Loans
and Tranche B Term Loans and each Lender acknowledges that the
provisions of Section 1126(c) of the Bankruptcy Code supersedes the
unanimous consent provisions set forth herein and (y) the Required
Lenders may consent to allow a Credit Party to use cash collateral in
the context of a bankruptcy or insolvency proceeding.
11.7 Counterparts.
This Credit Agreement may be executed in any number of counterparts,
each of which where so executed and delivered shall be an original, but all of
which shall constitute one and the same instrument. It shall not be necessary in
making proof of this Credit Agreement to produce or account for more than one
such counterpart.
11.8 Headings.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.
11.9 Defaulting Lender.
Each Supplemental Credit Lender understands and agrees that if such
Supplemental Credit Lender is a Defaulting Lender then it shall not be entitled
to vote on any matter requiring the consent of the Required Lenders or to object
to any matter requiring the consent of all the Lenders; provided, however, that
all other benefits and obligations under the Supplemental Credit Documents shall
apply to such Defaulting Lender.
11.10 Survival of Indemnification and Representations and
Warranties.
All indemnities set forth herein and all representations and warranties
made herein shall survive the execution and delivery of this Credit Agreement,
the making of the Tranche A Term and Tranche B Term Loans, the repayment of the
Tranche A Term and Tranche B Term Loans and other obligations and the
termination of the Tranche A Term Loan Committed Amount and Tranche B Term Loan
Committed Amount hereunder.
11.11 Governing Law; Venue.
(a) THIS CREDIT AGREEMENT AND THE OTHER SUPPLEMENTAL CREDIT
DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND
THEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
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ACCORDANCE WITH THE LAWS OF THE STATE OF TENNESSEE. Any legal action or
proceeding with respect to this Credit Agreement or any other Credit
Document may be brought in the courts of the State of North Carolina or
the State of Tennessee or of the United States for the Western District
of North Carolina or the Eastern District of Tennessee, and, by
execution and delivery of this Credit Agreement, each Credit Party
hereby irrevocably accepts for itself and in respect of its property,
generally and unconditionally, the jurisdiction of such courts. Each
Credit Party further irrevocably consents to the service of process out
of any of the aforementioned courts in any such action or proceeding by
the mailing of copies thereof by registered or certified mail, postage
prepaid, to it at the address for notices pursuant to Section 11.1,
such service to become effective 30 days after such mailing. Nothing
herein shall affect the right of a Lender to serve process in any other
manner permitted by law or to commence legal proceedings or to
otherwise proceed against a Credit Party in any other jurisdiction.
(b) Each Credit Party hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with
this Credit Agreement or any other Supplemental Credit Documents
brought in the courts referred to in subsection (a) hereof and hereby
further irrevocably waives and agrees not to plead or claim in any such
court that any such action or proceeding brought in any such court has
been brought in an inconvenient forum.
11.12 Waiver of Jury Trial.
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF
OR RELATING TO THIS AGREEMENT, ANY OF THE OTHER SUPPLEMENTAL CREDIT DOCUMENTS OR
THE TRANSACTIONS CONTEMPLATED HEREBY.
11.13 Time.
All references to time herein shall be references to Eastern Standard
Time or Eastern Daylight Time, as the case may be, unless specified otherwise.
11.14 Severability.
If any provision of any of the Supplemental Credit Documents is
determined to be illegal, invalid or unenforceable, such provision shall be
fully severable and the remaining provisions shall remain in full force and
effect and shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.
11.15 Entirety.
This Credit Agreement together with the other Supplemental Credit
Documents represent the entire agreement of the parties hereto and thereto, and
supersede all prior agreements and
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understandings, oral or written, if any, including any commitment letters or
correspondence relating to the Supplemental Credit Documents or the transactions
contemplated herein and therein.
11.16 Binding Effect.
This Credit Agreement shall become effective at such time when all of
the conditions set forth in Section 5.1 of the New Credit Agreement have been
satisfied or waived by the Lenders and it shall have been executed by the
Borrower, the Guarantors and the Agent, and the Agent shall have received copies
hereof (telefaxed or otherwise) which, when taken together, bear the signatures
of each Supplemental Credit Lender, and thereafter this Credit Agreement shall
be binding upon and inure to the benefit of the Borrower, the Guarantors, the
Agent and each Supplemental Credit Lender and their respective successors and
assigns.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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Each of the parties hereto has caused a counterpart of this Credit
Agreement to be duly executed and delivered as of the date first above written.
BORROWER:
CHATTEM, INC.,
a Tennessee corporation
By:
Name:
Title
GUARANTOR: SIGNAL INVESTMENT & MANAGEMENT CO.,
a Delaware corporation
By:
Name:
Title
SUPPLEMENTAL CREDIT
LENDERS:
NATIONSBANK OF TENNESSEE, N.A.,
individually in its capacity as a
Supplemental Credit Lender and
in its capacity as Agent
By:
Name:
Title
Signature page to Amended and Restated Credit Agreement dated as of March 24,
1998 among Chattem, Inc., as Borrower, each of the Borrower's Domestic
Subsidiaries, as Guarantors, the Supplemental Credit Lenders, and NationsBank of
Tennessee, N.A., as agent for the Supplemental Credit Lenders
THE FIRST NATIONAL BANK OF CHICAGO
By:
Name:
Title:
CREDITANSTALT AG
By:
Name:
Title:
FIRST AMERICAN NATIONAL BANK
By:
Name:
Title:
PRIME INCOME TRUST
By:
Name:
Title:
XXX XXXXXX AMERICAN CAPITAL PRIME
RATE INCOME TRUST
By:
Name:
Title:
