______________________________________________________________________________
AMENDED AND RESTATED
CREDIT AGREEMENT
by and among
GIANT CEMENT HOLDING, INC.
and
EACH OF THE UNDERSIGNED SUBSIDIARIES
as Borrowers
and
SOUTHTRUST BANK, NATIONAL ASSOCIATION,
as Agent and as Lender
April 30, 1998
______________________________________________________________________________
TABLE OF CONTENTS
Page
ARTICLE I
Definitions and Terms
1.1 Amendment and Restatement 2
1.2 Definitions 2
1.3 Accounting Terms 18
1.4 UCC Terms 18
ARTICLE II
The Revolving Credit Facility
2.1 Revolving Loans 19
2.2 Payment of Interest 21
2.3 Payment of Principal 21
2.4 Revolving Credit Notes 22
2.5 Pro Rata Payments 22
2.6 Reductions 23
2.7 Conversions 23
2.8 Fee 23
2.9 Deficiency Advances 24
2.10 Use of Proceeds 24
2.11 Extension of Revolving Credit Termination Date 24
2.12 Appointment of Giant Holding and Authorized Representatives
as Agents for the Borrowers 25
ARTICLE III
The Term Loan Facility
3.1 Term Loan 25
3.2 Term Loan Advances 25
3.3 Payment of Interest 26
3.4 Payment of Principal 26
3.5 Use of Proceeds 27
3.6 Term Notes 27
3.7 Prepayment of Term Loans 27
3.8 Conversions and Elections of Subsequent Interest 28
ARTICLE IV
The Letter of Credit Facility
4.1 Letters of Credit 29
4.2 Reimbursement 29
4.3 Letter of Credit Fee 32
4.4 Administrative Fees 32
ARTICLE V
Yield Protection and Illegality
5.1 Additional Costs 32
5.2 Suspension of Loans 34
5.3 Illegality 34
5.4 Compensation 34
5.5 Alternate Loan and Lender 35
5.6 Taxes 35
ARTICLE VI
Conditions Precedent
6.1 Conditions of Initial Advance and Issuance of Letters
of Credit 36
6.2 Conditions of Loans and Issuance of Letters of Credit 39
ARTICLE VII
Representations and Warranties
7.1 Organization and Authority 40
7.2 Loan Documents 41
7.3 Solvency 41
7.4 Subsidiaries and Stockholders 41
7.5 Ownership Interests 41
7.6 Financial Condition 42
7.7 Title to Properties 42
7.8 Taxes 42
7.9 Other Agreements 43
7.10 Litigation 43
7.11 Margin Stock 43
7.12 Investment Company 43
7.13 Patents, Etc. 43
7.14 No Untrue Statement 44
7.15 No Consents, Etc. 44
7.16 Employee Benefit Plans 44
7.17 No Default 45
7.18 Hazardous Materials 45
7.19 RICO 45
7.20 Employment Matters 45
ARTICLE VIII
Affirmative Covenants
8.1 Financial Reports, Etc. 46
8.2 Maintain Properties 47
8.3 Existence, Qualification, Etc. 47
8.4 Regulations and Taxes 47
8.5 Insurance 48
8.6 True Books 48
8.7 Pay Indebtedness to Lenders and Perform Other Covenants 48
8.8 Payment of Other Indebtedness 48
8.9 Right of Inspection 48
8.10 Observe all Laws 48
8.11 Officer's Knowledge of Default 48
8.12 Suits or Other Proceedings 48
8.13 Environmental Compliance 49
8.14 Indemnification 49
8.15 Further Assurances 49
8.16 Employee Benefit Plans 49
8.17 Termination Events 49
8.18 ERISA Notices 50
8.19 Continued Operations 50
8.20 Use of Proceeds 50
8.21 New Subsidiaries 50
ARTICLE IX
Negative Covenants
9.1 Consolidated Indebtedness for Money Borrowed to
Consolidated Tangible Net Worth Ratio 51
9.2 Consolidated Fixed Charge Ratio 51
9.3 Current Ratio 51
9.4 Capital Expenditures 51
9.5 Consolidated Tangible Net Worth 51
9.6 Liens 52
9.7 Consolidated Indebtedness 53
9.8 Transfer of Assets 54
9.9 Investments; Acquisitions. 54
9.10 Merger or Consolidation 55
9.11 Change in Control 55
9.12 Transactions with Affiliates 56
9.13 Compliance with ERISA 56
9.14 Fiscal Year 57
9.15 Limitations on Sales and Leasebacks 57
9.16 Negative Pledge Clauses 57
ARTICLE X
Events of Default and Acceleration
10.1 Events of Default 57
10.2 Agent to Act 60
10.3 Cumulative Rights 60
10.4 No Waiver 60
10.5 Allocation of Proceeds 60
ARTICLE XI
The Agent
11.1 Appointment 61
11.2 Attorneys-in-fact 61
11.3 Limitation on Liability 61
11.4 Reliance 62
11.5 No Representations 62
11.6 Indemnification 62
11.7 Lender 63
11.8 Resignation 63
11.9 Sharing of Payments, etc 63
11.10 Fees 64
ARTICLE XII
Miscellaneous
12.1 Confidentiality 64
12.2 Assignments and Participations 65
12.3 Notices 66
12.4 Setoff 68
12.5 Survival 68
12.6 Expenses 69
12.7 Amendments 69
12.8 Counterparts 70
12.9 Termination 70
12.10 Governing Law 70
12.11 Indemnification 72
12.12 Headings and References 72
12.13 Severability 72
12.14 Entire Agreement 72
12.15 Agreement Controls 73
12.16 Usury Savings Clause 73
12.17 Joint and Several Obligations 73
EXHIBIT A Applicable Commitment Percentages A-1
EXHIBIT B Form of Assignment and Acceptance B-1
EXHIBIT C Notice of Appointment (or Revocation) of Authorized
Representative C-1
EXHIBIT D Request for Advance/Interest Rate Election D-1
EXHIBIT E Form of Revolving Note E-1
EXHIBIT F Form of Term Note F-1
EXHIBIT G Form of Security Agreement G-1
EXHIBIT H Form of Opinion of Borrowers' Counsel H-1
EXHIBIT I Compliance Certificate I-1
Schedule 1.1 Existing Letters of Credit
Schedule 7.5 Ownership Interests
Schedule 7.6 Indebtedness
Schedule 7.7 Liens
Schedule 7.16 Employee Benefit
Schedule 7.18 Hazardous Materials
Schedule 9.9 Investments
Credit Agreement
THIS AMENDED AND RESTATED CREDIT AGREEMENT, dated as of April 30, 1998 (the
"Agreement"), is made by and among GIANT CEMENT HOLDING, INC., a Delaware
corporation ("Giant Holding"), EACH OF THE UNDERSIGNED SUBSIDIARIES (together
with Giant Holding, each referred to individually herein as a "Borrower" and
collectively as the "Borrowers"), SOUTHTRUST BANK, NATIONAL ASSOCIATION, a
national banking association organized under the laws of the United States
previously known as SouthTrust Bank of Alabama, National Association, in its
capacity as a Lender, and each other lender executing and delivering a signature
page hereto and each other lender which may hereafter execute and deliver an
instrument of assignment with respect to this Agreement pursuant to Section 12.1
hereof (hereinafter such lenders may be referred to individually as a "Lender"
or collectively as the "Lenders"), and SOUTHTRUST BANK, NATIONAL ASSOCIATION, a
national banking association organized and existing under the laws of the United
States of America ("SouthTrust"), in its capacity as agent for the Lenders (in
such capacity, and any successor appointed in accordance with the terms of
Section 11.8 hereof, the "Agent");
W I T N E S S E T H:
WHEREAS, certain of the Borrowers (the "Existing Borrowers") are presently
party to a Credit Agreement dated December 20, 1996 with SouthTrust, as agent
and lender (the "Existing Lender") party thereto (the "Existing Agreement"); and
WHEREAS, the Existing Borrowers have requested that the Lenders make
available to the Borrowers a term loan facility to be used to refinance
indebtedness of Solite Corporation in connection with the merger of Solite
Corporation into GCHI Acquisition Corp., a wholly-owed Subsidiary of Giant
Holding, on the date hereof; and
WHEREAS, the Existing Borrowers have requested that Solite Corporation and
its Subsidiaries be added hereto as Borrowers; and
WHEREAS, the Existing Borrowers have requested that the Agent and the
Existing Lender amend and restate the Existing Agreement in its entirety in the
manner set forth herein; and
WHEREAS, the Lenders are willing to amend and restate the Existing
Agreement and to make available to the Borrowers certain term loan, revolving
credit and letter of credit facilities upon the terms and conditions set forth
herein;
NOW, THEREFORE, each of the Borrowers, the Lenders and the Agent hereby
agree as follows:
ARTICLE I
Definitions and Terms
1.1 Amendment and Restatement. The Borrowers, the Agent and the Lenders
hereby agree that upon the effectiveness of this Agreement, the terms and
provisions of the Existing Agreement shall be and hereby are amended and
restated in their entirety by the terms and conditions of this Agreement and the
terms and provisions of the Existing Agreement, except as otherwise provided
herein, shall be superseded by this Agreement.
Notwithstanding the amendment and restatement of the Existing Agreement by
this Agreement, the Borrowers shall continue to be liable to the Agent and the
Existing Lender with respect to (and to the extent of) agreements on the part of
the Borrowers under the Existing Agreement to indemnify and hold harmless the
Agent and the Existing Lender from and against all claims, demands, liabilities,
damages, losses, costs, charges and expenses to which the Agent and the Existing
Lender may be subject arising in connection with the Existing Agreement. This
Agreement is given as a substitution of, and not as a payment of, the
obligations of Borrowers under the Existing Agreement and is not intended to
constitute a novation of the Existing Agreement. Except as otherwise selected by
the Borrowers by delivery of a Borrowing Notice or Interest Rate Selection
Notice prior to the Closing Date in accordance with the terms hereof, upon the
effectiveness of this Agreement all amounts outstanding and owing by Borrowers
under the Existing Agreement as of the Closing Date, as determined by the
Lenders, shall constitute Base Rate Loans hereunder if such outstanding amounts
were Base Rate Loans under the Existing Agreement, and shall constitute
Eurodollar Rate Loans hereunder if such outstanding amounts were Eurodollar Rate
Loans under the Existing Agreement. Except as otherwise provided for by the
Borrowers by delivery to the Agent of an Application and Agreement for Letters
of Credit prior to the Closing Date in accordance with the terms hereof, upon
the effectiveness of this Agreement, all Letters of Credit issued for the
account of the Borrowers under the Existing Agreement as of the Closing Date
shall constitute Letters of Credit hereunder.
1.2 Definitions. For the purposes of this Agreement, in addition to the
definitions set forth above, the following terms shall have the respective
meanings set forth below:
"Accounts" means all Accounts of the Borrowers as defined in the
Security Agreement;
"Account Debtor" means any Person who is or who may become obligated
to any Borrower under or on account of an Account;
"Acquisition" means the acquisition of (i)a controlling equity
interest in another Person (including the purchase of an option, warrant or
convertible or similar type security to acquire such a controlling interest
at the time it becomes exercisable by the holder thereof), whether by
purchase of such equity interest or upon exercise of an option or warrant
for, or conversion of securities into, such equity interest, or (ii) assets
of another Person for which the Cost of Acquisition equals or exceeds
$1,000,000;
"Advance" means any borrowing under (i) the Revolving Credit Facility
consisting of a Base Rate Loan or a Eurodollar Rate Loan or (ii) the Term
Loan Facility consisting of a Base Rate Segment or a Eurodollar Rate
Segment, as the case may be;
"Affiliate" means any Person (i) which directly or indirectly through
one or more intermediaries controls, or is controlled by, or is under
common control with, any Borrower; (ii) which beneficially owns or holds
10% or more of any class of the outstanding voting stock (or in the case of
a Person which is not a corporation, 10% or more of the equity interest) of
any Borrower; or (iii) 10% or more of any class of the outstanding voting
stock (or in the case of a Person which is not a corporation, 10% or more
of the equity interest) of which is beneficially owned or held by any
Borrower. The term "control" means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and
policies of a Person, whether through ownership of voting stock, by
contract or otherwise;
"Applicable Commitment Percentage" means, with respect to each Lender
at any time, a fraction, the numerator of which shall be the sum of such
Lender's Revolving Credit Commitment, Term Loan Commitment and Letter of
Credit Commitment at such time and the denominator of which shall be the
sum of the Total Revolving Credit Commitment, Total Term Loan Commitment
and the Total Letter of Credit Commitment at such time, which Applicable
Commitment Percentage for each Lender as of the Closing Date is as set
forth in Exhibit A attached hereto and incorporated herein by reference;
provided that the Applicable Commitment Percentage of each Lender shall be
increased or decreased to reflect any assignments to or by such Lender
effected in accordance with Section 12.1 hereof;
"Applications for Letters of Credit" means, collectively, the
applications for letters of credit in the form provided by the Issuing Bank
and executed by the Borrowers from time to time and delivered to Issuing
Bank to support the issuance of Letters of Credit;
"Assignment and Acceptance" shall mean an Assignment and Acceptance in
the form of Exhibit B (with blanks appropriately filled in) delivered to
the Agent in connection with an assignment of a Lender's interest under
this Agreement pursuant to Section 12.1 hereof;
"Authorized Representative" means the President or Vice President of
Giant Holding or, with respect to financial matters, the chief financial
officer or treasurer of Giant Holding or any other person expressly
designated by the Board of Directors (or the appropriate committee thereof)
of each Borrower as an Authorized Representative of all Borrowers, as set
forth from time to time in a certificate in the form attached hereto as
Exhibit C;
"Base Rate" means the per annum rate of interest established from time
to time by SouthTrust at its principal office as its Base Rate. Any change
in the Base Rate shall become effective as of 12:01 A.M. of the Business
Day on which each change in the Base Rate is announced by SouthTrust. The
Base Rate is a reference rate used by SouthTrust in determining interest
rates on certain loans and is not intended to be the lowest rate of
interest charged on any extension of credit to any debtor;
"Base Rate Loan" means a Loan or Segment, as the case may be or the
context may require, for which the rate of interest is determined by
reference to the Base Rate;
"Base Rate Segment" means a Segment bearing interest or to bear
interest at the Base Rate.
"Board" means the Board of Governors of the Federal Reserve System (or
any successor body);
"Borrowers" Account" means a demand deposit account number 00000000
with SouthTrust Bank of South Carolina, N.A., or any successor account with
the Agent or an affiliate, which may be maintained at one or more offices
of the Agent or an agent of the Agent;
"Business Day" means, (i) with respect to any Base Rate Loan, any day
which is not a Saturday, Sunday or a day on which banks in the State of
Alabama are authorized or obligated by law, executive order or governmental
decree to be closed and, (ii) with respect to any Eurodollar Rate Loan, any
day which is a Business Day, as described above, and on which the relevant
international financial markets are open for the transaction of business
contemplated by this Agreement in London, England, New York, New York and
Birmingham, Alabama;
"Capital Expenditures" means, with respect to the Borrowers, for any
period, expenditures or costs in connection with Capital Leases and costs
for fixed or capital assets or improvements made by any Borrower during
such period which in accordance with GAAP applied on a Consistent Basis are
characterized as capital expenditures;
"Capital Leases" means all leases which have been or should be
capitalized in accordance with GAAP as in effect from time to time
including Statement No. 13 of the Financial Accounting Standards Board and
any successor thereof;
"Closing Date" means the date as of which this Agreement is executed
by each of the Borrowers, the Lenders and the Agent and on which the
conditions set forth in Section 6.1 hereof have been satisfied;
"Code" means the Internal Revenue Code of 1986, as amended, and any
regulations promulgated thereunder;
"Collateral" has, collectively, the meaning given to such term in each
Security Instrument in which it may appear;
"Consistent Basis" in reference to the application of GAAP means the
accounting principles observed in the period referred to are comparable in
all material respects to those applied in the preparation of the audited
consolidated financial statements of the Borrowers referred to in Section
7.6(a) hereof;
"Consolidated Current Assets" means all items that would be classified
as current assets on a consolidated balance sheet of the Borrowers in
accordance with GAAP applied on a Consistent Basis;
"Consolidated Current Liabilities" means all items that would be
classified as current liabilities on a consolidated balance sheet of the
Borrowers, including all current maturities of long term Consolidated
Indebtedness for Money Borrowed, in accordance with GAAP applied on a
Consistent Basis;
"Consolidated EBITDA" means, with respect to the Borrowers for any
period of computation thereof, the sum of, without duplication, (i)
Consolidated Net Income during such period, plus (ii) Consolidated Interest
Expense accrued during such period, plus (iii) taxes on income accrued
during such period, plus (iv) amortization during such period, plus (v)
Depreciation during such period, all determined on a consolidated basis in
accordance with GAAP applied on a Consistent Basis;
"Consolidated Fixed Charge Ratio" means, with respect to the Borrowers
for the period of computation thereof, the ratio of (i) Consolidated EBITDA
for such period plus Consolidated Lease Expense for such period, to (ii)
Consolidated Fixed Charges for such period;
"Consolidated Fixed Charges" means, with respect to the Borrowers for
any period of computation thereof, the sum of, without duplication, (i)
Consolidated Interest Expense during such period, plus (ii) Consolidated
Lease Expense during such period, plus (iii) current maturities of
Consolidated Indebtedness for Money Borrowed actually paid during such
period, all determined in accordance with GAAP applied on a Consistent
Basis;
"Consolidated Indebtedness" means, as of any date on which the amount
thereof is to be determined, all Indebtedness of the Borrowers as
determined on a consolidated basis;
"Consolidated Indebtedness for Money Borrowed" means, as of any date
on which the amount thereof is to be determined, all Indebtedness for Money
Borrowed of the Borrowers, excluding for purposes of Section 9.1 the
undrawn amount of letters of credit, as determined on a consolidated basis;
"Consolidated Interest Expense" means, for any period of computation
thereof, the gross interest expense of the Borrowers, including without
limitation (i) the current amortized portion of debt discounts to the
extent included in gross interest expense, (ii) the current amortized
portion of all fees (including, without limitation, fees payable in respect
of a Swap Agreement) payable in connection with the incurrence of
Consolidated Indebtedness to the extent included in gross interest expense
and (iii) the portion of any payments made in connection with Capital
Leases allocable to interest expense, all determined on a consolidated
basis in accordance with GAAP applied on a Consistent Basis;
"Consolidated Lease Expense" means, for any period of computation
thereof, all amounts paid or accrued by the Borrowers during such period
under operating leases (whether or not constituting rental expense), as
determined on a consolidated basis in accordance with GAAP applied on a
Consistent Basis;
"Consolidated Net Income" means, for any period of computation
thereof, the gross revenues from operations of the Borrowers (including
payments received by the Borrowers of interest income and dividends and
distributions from investments not related to an extraordinary event) less
all operating and non-operating expenses of the Borrowers all determined on
a consolidated basis in accordance with GAAP applied on a Consistent Basis;
but excluding as income for all purposes other than the computations
required under Section 9.5(ii)(B) the aggregate amount of all of the
following in excess of $500,000: (i) net gains on the sale, conversion or
other disposition of capital assets, (ii) net gains on the acquisition,
retirement, sale or other disposition of capital stock and other securities
of any Borrower, (iii) net gains on the collection of proceeds of life
insurance policies, (iv) any write-up of any asset, and (v) any other net
gain or credit of an extraordinary nature, all determined in accordance
with GAAP applied on a Consistent Basis;
"Consolidated Shareholders' Equity" means, as of any date on which the
amount thereof is to be determined, the sum of the following in respect of
the Borrowers (excluding any upward adjustment after the Closing Date due
to revaluation of assets): (i) the amount of issued and outstanding share
capital, plus (ii) the amount of additional paid-in capital and retained
earnings (or, in the case of a deficit, minus the amount of such deficit),
plus (iii) the amount of any foreign currency translation adjustment (if
positive, or, if negative, minus the amount of such translation
adjustment), minus (iv) the amount of any treasury stock, all determined on
a consolidated basis in accordance with GAAP applied on a Consistent Basis;
"Consolidated Tangible Net Worth" means, with respect to the Borrowers
as of any date on which the amount thereof is to be determined,
Consolidated Shareholders' Equity minus the net book value of all assets of
the Borrowers which would be treated as intangible assets determined on a
consolidated basis in accordance with GAAP applied on a Consistent Basis;
"Contingent Obligation" of any Person means all contingent liabilities
required (or which, upon the creation or incurring thereof, would be
required) to be included in the financial statements (including footnotes)
of such Person in accordance with GAAP applied on a Consistent Basis,
including Statement No. 5 of the Financial Accounting Standards Board, and
any obligation of such Person guaranteeing or in effect guaranteeing any
Indebtedness, dividend or other obligation of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, including
obligations of such Person however incurred:
(1) to purchase such Indebtedness or other obligation or any
property or assets constituting security therefor;
(2) to advance or supply funds in any manner (i) for the purchase
or payment of such Indebtedness or other obligation, or (ii) to
maintain a minimum working capital, net worth or other balance sheet
condition or any income statement condition of the primary obligor;
(3) to grant or convey any lien, security interest, pledge,
charge or other encumbrance on any property or assets of such Person
to secure payment of such Indebtedness or other obligation;
(4) to lease property or to purchase securities or other property
or services primarily for the purpose of assuring the owner or holder
of such Indebtedness or obligation of the ability of the primary
obligor to make payment of such Indebtedness or other obligation; or
(5) otherwise to assure the owner of the Indebtedness or such
obligation of the primary obligor against loss in respect thereof;
"Cost of Acquisition" means, with respect to any Acquisition, as
at the date of entering into any agreement therefor, the sum of the
following (without duplication): (i) the value of the capital stock,
warrants or options to acquire capital stock of any Borrower to be
transferred in connection therewith, (ii) any cash or other property
(excluding property described in clause (i)) and the unpaid principal
amount of any debt instrument given as consideration, (iii) any
Indebtedness assumed by any Borrower in connection with such Acquisition,
and (iv) out of pocket transaction costs for the services and expenses of
attorneys, accountants and other consultants incurred in effecting such a
transaction, and other similar transaction costs so incurred. For purposes
of determining the Cost of Acquisition for any transaction, (A) the capital
stock of Giant Holding shall be valued (I) at its market value as reported
on the Nasdaq National Market System with respect to shares that are freely
tradeable, and (II) with respect to shares that are not freely tradeable,
as determined by the Board of Directors of Giant Holding and, if requested
by the Agent, determined to be a reasonable valuation by an independent
firm selected by the Agent, (B) the capital stock of any Borrower other
than Giant Holding shall be valued as determined by the Board of Directors
of such Borrower and, if requested by the Agent, determined to be a
reasonable valuation by an independent firm selected by the Agent, and
(C) with respect to any Acquisition accomplished pursuant to the exercise
of options or warrants or the conversion of securities, the Cost of
Acquisition shall include both the cost of acquiring such option, warrant
or convertible security as well as the cost of exercise or conversion;
"Default" means any event or condition which, with the giving or
receipt of notice or lapse of time or both, would constitute an Event of
Default hereunder;
"Depreciation" means, with respect to the Borrowers for any period of
computation thereof, the aggregate amount of depreciation accrued during
such period as determined on a consolidated basis in accordance with GAAP
applied on a Consistent Basis;
"Dollars" and the symbol "$" means dollars constituting legal tender
for the payment of public and private debts in the United States of
America;
"Eligible Securities" means the following obligations and any other
obligations previously approved in writing by the Agent:
(i) direct obligations of, or obligations the timely payment of
principal and interest on which are fully and unconditionally
guaranteed by, the United States of America;
(ii) obligations of any corporation organized under the laws of
any state of the United States or under the laws of any other nation,
payable in the United States, expressed to mature not later than 90
days following the date of issuance thereof and rated in an investment
grade rating category by Standard & Poor's Corporation and Xxxxx'x
Investors Service, Inc.; and
(iii) interest bearing demand or time deposits issued by any
Lender or certificates of deposit, bankers acceptances and other
"money market instruments" maturing within one hundred eighty (180)
days from the date of issuance thereof and issued by a bank or trust
company organized under the laws of the United States or of any state
thereof having capital surplus and undivided profits aggregating at
least $1,000,000;
"Employee Benefit Plan" means any employee benefit plan within the
meaning of Section 3(3) of ERISA which (a) is maintained for employees of
any Borrower or is assumed by any Borrower in connection with any
acquisition or any of its ERISA Affiliates or (b) has at any time been
maintained for the employees of any Borrower or any current or former
ERISA Affiliate;
"Environmental Laws" means, collectively, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended,
the Superfund Amendments and Reauthorization Act of 1986, the Resource
Conservation and Recovery Act, the Toxic Substances Control Act, as
amended, the Clean Air Act, as amended, the Clean Water Act, as amended,
any other "Superfund" or "Superlien" law or any other federal, or
applicable state or local statute, law, ordinance, code, rule, regulation,
order or decree regulating, relating to, or imposing liability or standards
of conduct concerning, any Hazardous Material;
"Equipment" means all Equipment, as defined in the Security Agreement,
of Keystone Cement Company;
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute and all rules and
regulations promulgated thereunder;
"ERISA Affiliate", as applied to any Borrower, means any Person or
trade or business which is a member of a group which is under common
control with such Borrower, who together with such Borrower, is treated as
a single employer within the meaning of Section 414(b) and (c) of the Code;
"Eurodollar Rate Loan" means a Loan or Segment, as the case may be or
the context may require, for which the rate of interest is determined by
reference to the Eurodollar Rate;
"Eurodollar Rate" means the interest rate per annum calculated
according to the following formula:
Eurodollar = Interbank Offered Rate + 1.75%
Rate 1- Eurodollar Reserve Percentage
"Eurodollar Rate Segment" means a Segment bearing interest or to bear
interest at the Eurodollar Rate.
"Eurodollar Reserve Percentage" means, for any day, that percentage
(expressed as a decimal) which is in effect from time to time or any
successor regulation, as the maximum reserve requirement (including,
without limitation, any basic, supplemental, emergency, special, or
marginal reserves) applicable with respect to Eurocurrency liabilities as
that term is defined in Regulation D (or against any other category of
liabilities that includes deposits by reference to which the interest rate
of Eurodollar Rate Loans is determined), whether or not the Agent has any
Eurocurrency liabilities subject to such requirements without benefits of
credits or proration, exceptions or offsets that may be available from time
to time to Agent. The Eurodollar Rate shall be adjusted automatically on
and as of the effective date of any change in the Eurodollar Reserve
Percentage;
"Event of Default" means any of the occurrences set forth as such in
Section 10.1 hereof;
"Existing Letters of Credit" means those Letters of Credit issued by
the Issuing Bank described on Schedule 1.1 hereto.
"Facilities" means the Revolving Credit Facility, the Term Loan
Facility and the Letter of Credit Facility;
"Facility Termination Date" means the date on which both the Revolving
Credit Termination Date and the Term Loan Termination Date shall have
occurred and the Borrowers shall have fully paid and satisfied all
Obligations and no Letter of Credit is outstanding;
"Fiscal Year" means the fiscal year of the Borrowers ending on each
December 31;
"Foreign Benefit Law" means any applicable statute, law, ordinance,
code, rule, regulation, order or decree of any foreign nation or any
province, state, territory, protectorate or other political subdivision
thereof regulating, relating to, or imposing liability or standards of
conduct concerning, any Employee Benefit Plan;
"Four-Quarter Period" means a period of four full consecutive fiscal
quarters of the Borrowers, taken together as one accounting period;
"GAAP" means Generally Accepted Accounting Principles, being those
principles of accounting set forth in pronouncements of the Financial
Accounting Standards Board, the American Institute of Certified Public
Accountants or which have other substantial authoritative support and are
applicable in the circumstances as of the date of a report, as such
principles are from time to time supplemented and amended;
"Governmental Authority" shall mean any Federal, state, municipal,
national or other governmental department, commission, board, bureau,
agency or instrumentality or political subdivision thereof or any entity or
officer exercising executive, legislative or judicial, regulatory or
administrative functions of or pertaining to any government or any court,
in each case whether a state of the United States, the United States or
foreign;
"Hazardous Material" means and includes any hazardous, toxic or
dangerous waste, substance or material, the generation, handling, storage,
disposal, treatment or emission of which is subject to any Environmental
Law;
"Indebtedness" means with respect to any Person, (i) all Indebtedness
for Money Borrowed, (ii) the undrawn face amount of, and unpaid
Reimbursement Obligations in respect of, all letters of credit issued for
the account of such Person; (iii) all indebtedness of such Person for the
acquisition of property, (iv) all indebtedness secured by any Lien on the
property of such Person whether or not such indebtedness is assumed, (v)
all liability of such Person by way of endorsements (other than for
collection or deposit in the ordinary course of business), (vi) all
Contingent Obligations, (vii) all Rate Hedging Obligations and (viii) that
portion of obligations with respect to Capital Leases and each other item
which in accordance with GAAP is classified as a liability on a balance
sheet; provided that in no event shall the term Indebtedness include
surplus and retained earnings, lease obligations (other than pursuant to
Capital Leases), reserves for deferred income taxes and investment credits,
other deferred credits and reserves, trade payables, accrued expenses and
deferred compensation obligations and trade payables and accrued expenses
incurred in the ordinary course of business;
"Indebtedness for Money Borrowed" means with respect to any Person
determined on a consolidated basis, all Indebtedness in respect of money
borrowed, including without limitation all Capital Leases and the deferred
purchase price of any property or asset, evidenced by a promissory note,
bond, debenture or similar written obligation for the payment of money,
other than trade payables and accrued expenses incurred in the ordinary
course of business;
"Interbank Offered Rate" means, with respect to any Eurodollar Rate
Loan for the Interest Period applicable thereto, the average (rounded
upward to the nearest one-sixteenth (1/16) of one percent) per annum rate
of interest determined by the office of the Agent then determining such
rate (each such determination to be conclusive and binding) as of three
Business Days prior to the first day of such Interest Period, as the
effective rate at which deposits in immediately available funds in Dollars
are being, have been, or would be offered or quoted by Agent to major banks
in the applicable interbank market for Eurodollar deposits at any time
during the Business Day which is the second Business Day immediately
preceding the first day of such Interest Period, for a term comparable to
such Interest Period and in the amount of the Eurodollar Rate Loan;
"Interest Period" for each Eurodollar Rate Loan means a period
commencing on the date such Eurodollar Rate Loan is made or converted and
each subsequent period commencing on the last day of the immediately
preceding Interest Period for such Eurodollar Rate Loan, and ending on the
date 30, 60 or 90 days thereafter either as notified to the Agent by the
Authorized Representative three (3) Business Days prior to the beginning of
such Interest Period by delivery of a Request for Advance/Interest Rate
Election or as otherwise determined in accordance with Section 2.1(d)(iii)
hereof; provided, that,
(i) if an Interest Period for a Eurodollar Rate Loan would end on
a day which is not a Business Day such Interest Period shall be
extended to the next Business Day; and
(ii) there shall not be more than five (5) Interest Periods in
effect on any day;
"Inventory" means all Inventory of the Borrowers as defined in the
Security Agreement;
"Issuing Bank" means SouthTrust Bank, National Association, or any
successor or replacement bank, as issuer of Letters of Credit in accordance
with Article IV hereof;
"Lending Office" means, as to each Lender, the Lending Office of such
Lender designated on the signature pages hereof or in an Assignment and
Acceptance or such other office of such Lender (or of an affiliate of such
Lender) as such Lender may from time to time specify to the Authorized
Representative and the Agent as the office by which its Loans are to be
made and maintained;
"Letter of Credit" means the Existing Letters of Credit and any
Standby Letter of Credit issued by Issuing Bank for the account of the
Borrowers as described in Article IV hereof;
"Letter of Credit Commitment" means with respect to each Lender, the
obligation of such Lender to acquire Participations up to an aggregate
stated amount at any one time outstanding equal to such Lender's Applicable
Commitment Percentage of the Total Letter of Credit Commitment as the same
may be increased or decreased from time to time pursuant to this Agreement;
"Letter of Credit Facility" means the facilities described in Article
IV hereof providing for the issuance by Issuing Bank for the account of the
Borrowers of Letters of Credit in an aggregate stated amount at any time
outstanding not exceeding the Total Letter of Credit Commitment;
"Letter of Credit Outstandings" means all undrawn amounts of Letters
of Credit plus Reimbursement Obligations;
"Lien" means any interest in property securing any obligation owed to,
or a claim by, a Person other than the owner of the property, whether such
interest is based on the common law, statute or contract, and including but
not limited to the lien or security interest arising from a mortgage,
encumbrance, pledge, security agreement, conditional sale or trust receipt
or a lease, consignment or bailment for security purposes. For purposes of
this definition, any Borrower shall be deemed to be the owner of any
property which it has acquired or holds subject to a conditional sale
agreement, financing lease, or other arrangement pursuant to which title to
the property has been retained by or vested in some other Person for
security purposes;
"Loan" or "Loans" means any of the Revolving Loans or the Term Loan;
"Loan Documents" means this Agreement, the Notes, the Subordination
Agreement, the Security Instruments and all other instruments and documents
heretofore or hereafter executed or delivered to or in favor of any Lender
or the Agent in connection with the Loans made and transactions
contemplated under this Agreement, as the same may be amended, supplemented
or replaced from the time to time;
"Material Adverse Effect" means a material adverse effect (a) on the
business, properties, operations or condition, financial or otherwise, of
the Borrowers on a consolidated basis or (b) on the ability of the
Borrowers on a consolidated basis to perform, or of the Agent to enforce,
or of the Lenders to realize the benefits to be afforded by any remedy
after default of, the obligations of the Borrowers under the Loan
Documents;
"Multiemployer Plan" means a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA to which the Borrowers or any ERISA Affiliate
are making, or are accruing an obligation to make, contributions or have
made, or been obligated to make, contributions within the preceding six (6)
years;
"Net Proceeds" (a) from any public or private offering of equity or
debt securities means cash payments received by a Borrower therefrom as and
when received, net of all legal, accounting, banking and underwriting fees
and expenses, commissions, discounts and other issuance expenses incurred
in connection therewith and all taxes required to be paid or accrued as a
consequence of such issuance; and (b) from any disposition of assets means
cash payments received by a Borrower therefrom (including any cash payments
received pursuant to any note or other debt security received in connection
with any asset disposition) as and when received, net of (i) all legal fees
and expenses and other fees and expenses paid to third parties and incurred
in connection therewith, (ii) all taxes required to be paid or accrued as a
consequence of such sale and (iii) amounts applied to repayment of
Consolidated Indebtedness (other than the Obligations) secured by a Lien on
the asset or property disposed;
"Notes" means, collectively, the Revolving Notes and the Term Notes;
"Obligations" means the obligations, liabilities and Indebtedness of
the Borrowers with respect to (i) the principal and interest on the Loans,
(ii) the Reimbursement Obligations; (iii) all liabilities of any Borrower
to any Lender which arise under a Swap Agreement, and (iv) the payment and
performance of all other obligations, liabilities and Indebtedness of the
Borrowers to the Lenders or the Agent hereunder or, under any one or more
of the other Loan Documents;
"Participation" means, with respect to any Lender (other than Issuing
Bank), the extension of credit represented by the Participation of such
Lender hereunder in the liability of Issuing Bank in respect of a Letter of
Credit issued by Issuing Bank in accordance with the terms hereof;
"PBGC" means the Pension Benefit Guaranty Corporation and any
successor thereto;
"Pension Plan" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to the provisions of Title IV of ERISA
or Section 412 of the Code and which is or was maintained for employees of
the Borrowers or any ERISA Affiliate;
"Person" means an individual, partnership, corporation, trust,
unincorporated organization, association, joint venture or a government or
agency or political subdivision thereof;
"Principal Office" means the office of the Agent at 000 Xxxxx 00xx
Xxxxxx, Xxxxxxxxxx, Xxxxxxx 00000, or such other office and address as the
Agent may from time to time designate and deliver notice of such
designation in accordance with Section 12.2 hereof;
"Rate Hedging Obligations" means any and all obligations of the
Borrowers, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions
and modifications thereof and substitutions therefor), under (i) any and
all agreements, devices or arrangements designed to protect at least one of
the parties thereto from the fluctuations of interest rates, exchange rates
or forward rates applicable to such party's assets, liabilities or exchange
transactions, including, but not limited to, Dollar-denominated or
cross-currency interest rate exchange agreements, forward currency exchange
agreements, interest rate cap or collar protection agreements, forward rate
currency or interest rate options, puts, warrants and those commonly known
as interest rate "swap" agreements; and (ii) any and all cancellations,
buybacks, reversals, terminations or assignments of any of the foregoing;
"Regulation D" means Regulation D of the Board as the same may be
amended or supplemented from time to time;
"Regulatory Change" means any change effective after the Closing Date
in United States federal or state laws or regulations (including Regulation
D and capital adequacy regulations) or foreign laws or regulations or the
adoption or making after such date of any interpretations, directives or
requests applying to a class of banks, which includes any of the Lenders,
under any United States federal or state or foreign laws or regulations
(whether or not having the force of law) by any court or governmental or
monetary authority charged with the interpretation or administration
thereof or compliance by any Lender with any request or directive regarding
capital adequacy, including with respect to "highly leveraged
transactions," whether or not having the force of law, whether or not
failure to comply therewith would be unlawful and whether or not published
or proposed prior to the date hereof;
"Reimbursement Obligation" shall mean at any time, the obligation of
the Borrowers with respect to any Letter of Credit to reimburse Issuing
Bank and the Lenders to the extent of their respective Participations
(including by the receipt by Issuing Bank of proceeds of Loans pursuant to
Section 4.2 hereof) for amounts theretofore paid by Issuing Bank pursuant
to a drawing under such Letter of Credit;
"Request For Advance/Interest Rate Election" means a Request For
Advance/Interest Rate Election in the form of Exhibit D hereto to be
delivered by the Borrowers in connection with any Advance or interest rate
election with respect to any of the Loans;
"Required Lenders" means, as of any date, Lenders on such date having
Credit Exposures (as defined below) of at least (i) if there shall be fewer
than three (3) Lenders, 100% of the aggregate Credit Exposures of all
Lenders on such date, and (ii) if there shall be three (3) or more Lenders,
66-2/3% of the aggregate Credit Exposures of all the Lenders on such date.
For purposes of the preceding sentence, the amount of the "Credit Exposure"
of each Lender shall be equal at all times (a) other than following the
occurrence and during the continuance of an Event of Default, to the sum of
the amounts of its Revolving Credit Commitment, Term Loan Commitment and
Letter of Credit Commitment, and (b) following the occurrence and during
the continuance of an Event of Default, to the sum of (i) the aggregate
principal amount of such Lender's Applicable Commitment Percentage of
Revolving Credit Outstandings plus (ii) the aggregate unutilized amount of
such Lender's Revolving Credit Commitment plus (iii) the amount of such
Lender's Applicable Commitment Percentage of Letter of Credit Outstandings
plus (iv) the aggregate principal amount of such Lender's Applicable
Commitment Percentage of Term Loan Outstandings; provided that, for the
purpose of this definition only, (x) if any Lender shall have failed to
fund its Applicable Commitment Percentage of any Advance of such Lender
shall be deemed reduced by the amount it so failed to fund for so long as
such failure shall continue and such Lender's Credit Exposure attributable
to such failure shall be deemed held by any Lender making more than its
Applicable Commitment Percentage of such Advance to the extent it covers
such failure, and (y) if any Lender shall have failed to pay to the Issuing
Bank upon demand its Applicable Commitment Percentage of any drawing under
any Letter of Credit resulting in an outstanding Reimbursement Obligation,
such Lender's Credit Exposure attributable to such Letter of Credit
Outstandings shall be deemed to be held by Issuing Bank;
"Reserve Requirement" means, for any Eurodollar Rate Loan with respect
thereto, the maximum aggregate rate at which reserves (including, without
limitation, any marginal, supplemental or emergency reserves) are required
to be maintained with respect thereto under Regulation D by the member
banks of the Federal Reserve System with respect to Dollar funding in the
London interbank market. Without limiting the effect of the foregoing, the
Reserve Requirement shall reflect any other reserves required to be
maintained by such member banks by reason of any Regulatory Change against
(i) any category of liabilities which includes deposits by reference to
which the Base Rate is to be determined or (ii) any category of extensions
of credit or other assets which include Eurodollar Rate Loans;
"Restricted Payment" means (a) any dividend or other distribution,
direct or indirect, on account of any shares of any class of stock of Giant
Holding now or hereafter outstanding, except a dividend payable solely in
shares of that class of stock to the holders of that class; (b) any
redemption, conversion, exchange, retirement or similar payment, purchase
or other acquisition for value, direct or indirect, of any shares of any
class of capital stock of Giant Holding now or hereafter outstanding (other
than an exchange of shares of one class of capital stock of Giant Holding
for shares of another class of capital stock of Giant Holding); and (c) any
payment made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire shares of any class of stock
of Giant Holding now or hereafter outstanding;
"Revolving Credit Commitment" means, with respect to each Lender, the
obligation of such Lender to make Revolving Loans to the Borrowers up to an
aggregate principal amount at any one time outstanding as set forth on
Exhibit A hereto as the same may be increased or decreased from time to
time pursuant to this Agreement;
"Revolving Credit Facility" means the facility described in Article II
hereof providing for Loans to the Borrowers by the Lenders in the aggregate
principal amount of the Total Revolving Credit Commitment;
"Revolving Credit Outstandings" means, as of any date of
determination, the aggregate principal amount of all Revolving Loans then
outstanding;
"Revolving Credit Termination Date" means (i) December 20, 1999 or
(ii) such earlier date of termination of Lenders' obligations pursuant to
Section 10.1 upon the occurrence of an Event of Default, or (iii) such date
as the Borrowers may voluntarily and permanently terminate the Revolving
Credit Facility by payment in full of all Obligations (including the
discharge of all Obligations of Issuing Bank and the Lenders with respect
to Letters of Credit and Participations) or (iv) such later date as the
Borrowers and the Lender shall agree in writing pursuant to Section 2.11
hereof;
"Revolving Loan" means any borrowing pursuant to an Advance under the
Revolving Credit Facility in accordance with Article II hereof;
"Revolving Notes" means, collectively, the promissory notes of the
Borrowers evidencing Revolving Loans executed and delivered to the Lenders
as provided in Section 2.4 hereof substantially in the form attached hereto
as Exhibit E, with appropriate insertions as to amounts, dates and names of
Lenders;
"Security Agreement" means that certain Amended and Restated Security
Agreement dated as of the date hereof between the Borrowers and the Agent
for the benefit of the Lenders and substantially in the form of Exhibit G
hereto, as hereafter amended, supplemented or replaced from time to time;
"Security Instruments" means, collectively, the Security Agreement,
and all other agreements, instruments and other documents, whether now
existing or hereafter in effect, pursuant to which the Borrowers shall
grant or convey to the Agent or the Lenders a Lien in property as security
for the Obligations, as any of them may be amended, supplemented or
replaced from time to time;
"Segment" means a portion of the Term Loan (or all thereof) with
respect to which a particular interest rate is (or is proposed to be )
applicable;
"Single Employer Plan" means any employee pension benefit plan covered
by Title IV of ERISA in respect of which the Borrowers are an "employer" as
described in Section 4001(b) of ERISA and which is not a Multi-employer
Plan;
"Solite Documents" means all agreements, contracts, instruments and
other documents used to document the Solite Transaction;
"Solite Transaction" means the merger of Solite Corporation, a
Virginia corporation, into GCHI Acquisition Corp., a wholly-owned
Subsidiary of Giant Holding, occurring on the date hereof pursuant to the
terms and conditions of the Solite Documents.
"Solvent" means, when used with respect to any Person, that at the
time of determination:
(i) the fair value of its assets (both at fair valuation and at
present fair saleable value on an orderly basis) is in excess of the
total amount of its liabilities, including, without limitation,
Contingent Obligations; and
(ii) it is then able and expects to be able to pay its debts as
they mature; and
(iii) it has capital sufficient to carry on its business as
conducted and as proposed to be conducted;
"Standby Letter of Credit" means an irrevocable Standby Letter of
Credit issued hereunder for the account of the Borrowers or any of its
Subsidiaries, provided that the expiry date of a Standby Letter of Credit
shall not be later than the latest of (i) twelve (12) months subsequent to
the date of issuance thereof with such automatic renewal terms thereof as
the Issuing Bank shall reasonably approve provided such renewal does not
extend the expiry date beyond the time in clause (ii) following; and (ii)
the fifth Business Day preceding the Revolving Credit Termination Date;
"Subordination Agreement" means that certain Subordination Agreement
dated as of the date hereof between the Borrowers and the Agent for the
benefit of the Lenders, as hereafter amended, supplemented or replaced from
time to time;
"Subsidiary" means any corporation or other entity in which more than
50% of its outstanding voting stock or more than 50% of all equity
interests is owned directly or indirectly by any of the Borrowers and/or by
one or more of any Borrower's Subsidiaries;
"Swap Agreement" means one or more agreements between any Borrower and
any Person with respect to Indebtedness evidenced by the Notes, on terms
mutually acceptable to such Borrower and such Person and approved by each
of the Lenders, which agreements create Rate Hedging Obligations; provided,
however, that no such approval of the Lenders shall be required to the
extent such agreements are entered into between such Borrower and any
Lender;
"Term Loan" means the loan made pursuant to the Term Loan Facility in
accordance with Article III;
"Term Loan Commitment" means, with respect to each Lender, the
obligation of such Lender to make the Term Loan to the Borrowers up to an
aggregate principal amount at any one time outstanding as set forth on
Exhibit A hereto;
"Term Loan Facility" means the facility described in Article III
providing for a Term Loan to the Borrowers by the Lenders in the principal
amount of the Total Term Loan Commitment'
"Term Loan Outstandings" means, as of any date of determination, the
aggregate principal amount of the Term Loan then outstanding and all
interest accrued thereon;
"Term Loan Termination Date" means (i) April 30, 2003 or (ii) such
earlier date of termination of Lenders' obligations pursuant to Section
10.1 upon the occurrence of an Event of Default, or (iii) such date as the
Borrowers may voluntarily or by mandatory prepayment permanently terminate
the Term Loan Facility by payment in full of all Term Loan Outstandings and
all other Obligations incurred in connection with the Term Loan;
"Term Notes" the term loan promissory notes of the Borrowers executed
and delivered to the Lenders as provided in Section 3.8 hereof in
substantially the form attached hereto as Exhibit F and any amended and
restated promissory notes of the Borrowers delivered after the date hereof
in substitution thereof;
"Termination Event" means: (a) a "Reportable Event" described in
Section 4043 of ERISA and the regulations issued thereunder (unless the
notice requirement has been waived by applicable regulation); or (b) the
withdrawal of the Borrowers or any ERISA Affiliate from a Pension Plan
during a plan year in which it was a "substantial employer" as defined in
Section 4001(a)(2) of ERISA or was deemed such under Section 4068(f) of
ERISA; or (c) the termination of a Pension Plan, the filing of a notice of
intent to terminate a Pension Plan or the treatment of a Pension Plan
amendment as a termination under Section 4041 of ERISA; or (d) the
institution of proceedings to terminate a Pension Plan by the PBGC; or (e)
any other event or condition which would constitute grounds under Section
4042(a) of ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan; or (f) the partial or complete withdrawal of
the Borrowers or any ERISA Affiliate from a Multiemployer Plan; or (g) the
imposition of a Lien pursuant to Section 412 of the Code or Section 302 of
ERISA; or (h) any event or condition which results in the reorganization or
insolvency of a Multiemployer Plan under Section 4241 or Section 4245 of
ERISA, respectively; or (i) any event or condition which results in the
termination of a Multiemployer Plan under Section 4041A of ERISA or the
institution by the PBGC of proceedings to terminate a Multiemployer Plan
under Section 4042 of ERISA;
"Total Letter of Credit Commitment" means an aggregate stated amount
equal to $4,000,000;
"Total Revolving Credit Commitment" means a principal amount equal to
$30,000,000, as reduced from time to time in accordance with Section 2.6
hereof;
"Total Term Loan Commitment" means a principal amount equal to
$12,000,000;
1.3 Accounting Terms. All accounting terms not specifically defined herein
shall have the meanings assigned to such terms and shall be interpreted in
accordance with GAAP applied on a Consistent Basis.
1.4 UCC Terms. Each term defined in Article 1 or 9 of the South Carolina
Uniform Commercial Code shall have the meaning given therein unless otherwise
defined herein, except to the extent that the Uniform Commercial Code of another
jurisdiction is controlling, in which case such terms shall have the meaning
given in the Uniform Commercial Code of the applicable jurisdiction.
ARTICLE II
The Revolving Credit Facility
2.1 Revolving Loans.
(a) Commitment. Subject to the terms and conditions of this Agreement,
each Lender severally agrees to make Advances to the Borrowers under the
Revolving Credit Facility from time to time from the Closing Date until the
Revolving Credit Termination Date on a pro rata basis as to the total
borrowing requested by the Borrowers on any day determined by such Lender's
Applicable Commitment Percentage up to but not exceeding the Revolving
Credit Commitment of such Lender, provided, however, that the Lenders will
not be required and shall have no obligation to make any such Advance (i)
so long as a Default or an Event of Default has occurred and is continuing
or (ii) if the Agent has accelerated the maturity of any of the Notes as a
result of an Event of Default. Within such limits, the Borrowers may
borrow, repay and reborrow under the Revolving Credit Facility on any
Business Day from the Closing Date until, but (as to borrowings and
reborrowings) not including, the Revolving Credit Termination Date;
provided, however, that (x) no Revolving Loan that is a Eurodollar Rate
Loan shall be made which has an Interest Period that extends beyond the
Revolving Credit Termination Date and (y) each Revolving Loan that is a
Eurodollar Rate Loan may, subject to the provisions of Section 2.3 hereof,
be repaid only on the last day of the Interest Period with respect thereto.
(b) Amounts. Except as otherwise permitted by the Lenders from time to
time, the aggregate unpaid principal amount of the Revolving Credit
Outstandings shall not exceed at any time the Total Revolving Credit
Commitment. Each Revolving Loan hereunder and each conversion under Section
2.7 hereof shall be in an amount of at least $10,000, and, if greater than
$10,000, an integral multiple of $10,000.
(c) Mandatory Paydown. The aggregate Revolving Credit Outstandings
shall be reduced to not more than $20,000,000 for a period of 30
consecutive days during each twelve month period following the initial
Advance under the Revolving Credit Facility.
(d) Advances.
(i) An Authorized Representative shall give the Agent (1) at
least three (3) Business Days' irrevocable written notice of each
Eurodollar Rate Loan (whether representing an additional borrowing
hereunder or the conversion of borrowing hereunder from Base Rate
Loans to Eurodollar Rate Loans) prior to 10:30 A.M., Birmingham,
Alabama time and (2) irrevocable written notice of each Base Rate Loan
(whether representing an additional borrowing hereunder or the
conversion of borrowing hereunder from Eurodollar Rate Loans to Base
Rate Loans) prior to 10:30 A.M. Birmingham, Alabama time on the day of
such proposed Revolving Loan. Each such written notice, which shall be
effective upon receipt by the Agent, may be delivered by telefacsimile
and shall be in the form of the Request For Advance/Interest Rate
Election and shall specify the amount of the borrowing, the type of
Revolving Loan (Base Rate or Eurodollar Rate), the date of borrowing
and, if a Eurodollar Rate Loan, the Interest Period to be used in the
computation of interest. Notice of receipt of such Request For
Advance/Interest Rate Election shall be provided by the Agent to each
Lender by telefacsimile with reasonable promptness, but not later than
1:00 P.M., Birmingham, Alabama time on the same day as Agent's receipt
of such notice.
(ii) Not later than 1:00 P.M., Birmingham, Alabama time on the
date specified for each Advance under this Section 2.1, each Lender
shall, pursuant to the terms and subject to the conditions of this
Agreement, initiate a wire transfer to the Agent in the amount of its
pro rata share, determined according to such Lender's Applicable
Commitment Percentage, of the Revolving Loan or Revolving Loans to be
made on such day. Such wire transfer shall be directed to the Agent at
the Principal Office and shall be in the form of immediately available
funds. The amount so received by the Agent shall, subject to the terms
and conditions of this Agreement, be made available to the Borrowers
by delivery of the proceeds thereof to the Borrowers' Account or
otherwise as shall be directed in the applicable Borrowing Notice by
the Authorized Representative.
(iii) The duration of the initial Interest Period for each
Revolving Loan that is a Eurodollar Rate Loan shall be as specified in
the initial Request For Advance/Interest Rate Election delivered in
accordance with clause (i) above. The Borrowers shall have the option
to convert the Eurodollar Rate Loans in accordance with Section 2.7
hereof. In the event the Agent fails to receive a properly completed
Request for Advance/Interest Rate Selection by such time as required
by Section 2.7 hereof to convert a Eurodollar Rate Loan, the duration
of each subsequent Interest Period for such Eurodollar Rate Loan after
the initial Interest Period therefor shall be determined automatically
by the Agent on the date three (3) Business Days' prior to the end of
such preceding Interest Period and shall be that available Interest
Period on such date (30, 60 or 90 days) which has the lowest
corresponding Eurodollar Rate and, if more than one available Interest
Period has the same lowest Eurodollar Rate, the shortest such Interest
Period shall be the applicable subsequent Interest Period for such
Eurodollar Rate Loan.
(iv) Notwithstanding the foregoing, if a drawing is made under
any Letter of Credit prior to the Revolving Credit Termination Date,
notice of such drawing and resulting Reimbursement Obligation shall be
provided promptly by Issuing Bank to the Agent and the Agent shall
provide notice to each Lender and the Borrowers by telephone. If such
notice to the Lenders of a drawing under any Letter of Credit is given
by the Agent at or before 1:00 p.m. on any Business Day, the Borrowers
shall be deemed to have requested, and each Lender shall, pursuant to
the conditions of this Agreement, make an Advance as a Base Rate Loan
under the Revolving Credit Facility in the amount of such Lender's
Applicable Commitment Percentage of such Reimbursement Obligation and
shall pay such amount to the Agent for the account of Issuing Bank at
the Principal Office in Dollars and in immediately available funds
before 2:30 P.M. on the same Business Day. If notice to the Lenders is
given by the Agent after 1:00 P.M. on any Business Day, the Borrowers
shall be deemed to have requested, and each Lender shall, pursuant to
the terms and subject to the conditions of this Agreement, make an
Advance as a Base Rate Loan under the Revolving Credit Facility in the
amount of such Lender's Applicable Commitment Percentage of such
Reimbursement Obligation and shall pay such amount to the Agent for
the account of Issuing Bank at the Principal Office in Dollars and in
immediately available funds before 12:00 noon on the next following
Business Day. Such Base Rate Loan shall continue unless and until the
Borrowers convert such Base Rate Loan in accordance with the terms of
Section 2.7 hereof.
2.2 Payment of Interest.
(a) The Borrowers shall pay interest to the Agent for the account of
each Lender on the outstanding and unpaid principal amount of each
Revolving Loan made by such Lender for the period commencing on the date of
such Revolving Loan until such Revolving Loan shall be due at the Base Rate
applicable for each Business Day during such period minus one percent (1%)
for Base Rate Loans or the applicable Eurodollar Rate for Eurodollar Rate
Loans. The applicable Eurodollar Rate for any Eurodollar Rate Loan shall be
that Eurodollar Rate available for the entire Interest Period for such
Eurodollar Rate Loan, which Interest Period has either been designated by
the Authorized Representative in the Request for Advance/Interest Rate
Election and delivered to the Agent pursuant to Sections 2.1 or 2.7 hereof
or, in the absence of such designation and delivery, has been determined
for the corresponding Interest Period determined in accordance with Section
2.1(d)(iii) hereof. If any amount shall not be paid when due (at maturity,
by acceleration or otherwise), all amounts outstanding hereunder shall bear
interest commencing on the date when due until, but excluding, the date
thereafter when such amounts past due are paid in full (i) in the case of a
Eurodollar Rate Loan, until the end of the Interest Period with respect to
any Eurodollar Rate Loan at a rate of two percent (2%) above the applicable
Eurodollar Rate for such Eurodollar Rate Loan and thereafter at a rate per
annum which shall be two percent (2%) plus the Base Rate, (ii) with respect
to Base Rate Loans, at a rate of interest per annum which shall be two
percent (2%) above the Base Rate, or (iii) in any case, the maximum rate
permitted by applicable law, if lower.
(b) Interest on each Revolving Loan shall be computed on the basis of
a year of 360 days and calculated in each case for the actual number of
days elapsed. Interest on each Revolving Loan shall be paid (i) monthly in
arrears on the last Business Day of each month commencing May 31, 1998 for
each Base Rate Loan, (ii) on the last day of the applicable Interest Period
for each Eurodollar Rate Loan and (iii) upon payment in full of the
principal amount of such Revolving Loan.
2.3 Payment of Principal.
(a) The principal amount of each Revolving Loan shall be due and
payable to the Agent for the benefit of each Lender in full on the
Revolving Credit Termination Date, or earlier as specifically provided
herein. The principal amount of any Base Rate Loan may be prepaid in whole
or in part at any time. The principal amount of any Eurodollar Rate Loan
may be prepaid only at the end of the applicable Interest Period unless the
Borrowers shall pay to the Agent for the account of the Lenders the amount,
if any, required under Section 5.4 hereof. If at any time the amount of
Revolving Credit Outstandings exceeds the Total Revolving Credit
Commitment, a principal amount of the outstanding Revolving Loans equal to
such excess shall be due and payable immediately. All prepayments made by
the Borrowers shall be in the amount of $100,000 or such greater amount
which is an integral multiple of $100,000, or such other amount as
necessary to comply with this Section 2.3 or with Section 2.1(c) and 2.6
hereof.
(b) Each payment of principal (including any prepayment) and payment
of interest and fees, and any other amount required to be paid to the
Lenders with respect to the Revolving Loans, shall be made to the Agent at
the Principal Office, for the account of each Lender, in Dollars and in
immediately available funds before 3:00 P.M. Birmingham, Alabama time on
the date such payment is due. The Agent may, but shall not be obligated to,
debit the amount of any such payment which is not made by such time to any
ordinary deposit account, if any, of any one or more Borrowers with the
Agent.
(c) The Agent shall deem any payment by or on behalf of the Borrowers
hereunder that is not made both in Dollars and in immediately available
funds and prior to 3:00 P.M. Birmingham, Alabama time to be a
non-conforming payment. Any such payment shall not be deemed to be received
by the Agent until the later of (i) the time such funds become available
funds and (ii) the next Business Day. Any non-conforming payment may
constitute or become a Default or Event of Default pursuant to Section
10.1(b) hereof. Interest shall continue to accrue on any principal as to
which a non-conforming payment is made until the later of (x) the date such
funds become available funds or (y) the next Business Day at the respective
rates of interest per annum specified in the proviso to Section 2.2 hereof
regarding interest on late payments, from the date such amount was due and
payable.
(d) In the event that any payment hereunder or under the Notes becomes
due and payable on a day other than a Business Day, then such due date
shall be extended to the next succeeding Business Day unless provided
otherwise under clause (ii) of the definition of "Interest Period";
provided that interest shall continue to accrue during the period of any
such extension and provided further, that in no event shall any such due
date be extended beyond the Revolving Credit Termination Date.
2.4 Revolving Credit Notes. Revolving Credit Loans made by each Lender
shall be evidenced by the Revolving Credit Note payable to the order of such
Lender in the respective amounts of its Revolving Credit Commitment, which
Revolving Credit Notes shall be dated the Closing Date or such later date
pursuant to an Assignment and Acceptance and shall be duly completed, executed
and delivered by the Borrowers.
2.5 Pro Rata Payments. Except as otherwise provided herein, (a) each
payment on account of the principal of and interest on the Revolving Loans and
the fees described in Section 2.8 hereof shall be made to the Agent for the
account of the Lenders pro rata based on their Applicable Commitment
Percentages, (b) all payments to be made by the Borrowers for the account of
each of the Lenders on account of principal, interest and fees, shall be made
without set-off or counterclaim, and (c) the Agent will distribute payments
received from the Borrowers to the Lenders on the same day such payments are
received in accordance with the terms of this Agreement.
2.6 Reductions. The Borrowers shall, by notice from an Authorized
Representative, have the right from time to time, upon not less than two (2)
Business Days written notice to the Agent, to reduce the Total Revolving Credit
Commitment. Each such reduction shall be in the aggregate amount of $1,000,000
or such greater amount which is in an integral multiple of $100,000, and shall
permanently reduce the Total Revolving Credit Commitment. No such reduction
shall result in the payment of any Eurodollar Rate Loan other than on the last
day of the Interest Period of such Eurodollar Rate Loan unless such prepayment
is accompanied by amounts due, if any, under Section 5.4 hereof. Each reduction
of the Total Revolving Credit Commitment shall be accompanied by payment of the
Loans to the extent that the amount of Revolving Credit Outstandings exceeds the
Total Revolving Credit Commitment after giving effect to such reduction,
together with accrued and unpaid interest on the amounts prepaid.
2.7 Conversions. The Borrowers may:
(a) upon delivery of a properly completed Request For Advance/Interest
Rate Election to the Agent on or before 10:30 A.M. Birmingham, Alabama time
on any Business Day, convert all or a part of Eurodollar Rate Loans to Base
Rate Loans on the last day of the Interest Period for such Eurodollar Rate
Loans; and
(b) provided that no Default or Event of Default shall have occurred
and be continuing and subject to the limitations set forth below and in
Article V hereof, upon delivery of a properly completed Request For
Advance/Interest Rate Election to the Agent on or before 10:30 A.M.
Birmingham, Alabama time three (3) Business Days' prior to the date of such
election or conversion, convert Base Rate Loans to Eurodollar Rate Loans on
any date, or continue any Eurodollar Rate Loan by election of a subsequent
Interest Period therefor on the last day of the Interest Period for such
Eurodollar Rate Loan.
Each conversion pursuant to this Section 2.7 shall be subject to the
limitations on Eurodollar Rate Loans set forth in the definition of "Interest
Period" herein and in Sections 2.1, 2.3 and Article V hereof. The Agent shall
give written notice to each Lender of such notice of election or conversion
prior to 3:00 P.M. Birmingham, Alabama time on the day such notice of conversion
is received. If the Agent does not receive a notice of election of duration of
an Interest Period or to convert an outstanding Eurodollar Rate Loan by the time
prescribed above, the Borrower shall be deemed to have elected to convert such
Eurodollar Rate Loan to a Base Rate Loan on the last day of the Interest Period
for such Eurodollar Rate Loan. All such conversions of Loans shall be effected
pro rata based on the Applicable Commitment Percentages of the Lenders.
2.8 Fee. For the period beginning on the Closing Date and ending on the
Revolving Credit Termination Date, the Borrowers agree to pay to the Agent, for
the pro rata benefit of the Lenders based on their Applicable Commitment
Percentages, an unused fee equal to .15% per annum multiplied by the sum of (i)
the daily amount by which the Total Revolving Credit Commitment exceeds
Revolving Credit Outstandings plus (ii) the daily amount by which the Total
Letter of Credit Commitment exceeds Letter of Credit Outstandings. Such payments
of fees provided for in this Section 2.8 shall be due in arrears on the last
Business Day of each December, March, June and September beginning June 1998, to
and on the Revolving Credit Termination Date. Notwithstanding the foregoing, so
long as any Lender fails to make available any portion of its Revolving Credit
Commitment or Letter of Credit Commitment when requested, such Lender shall not
be entitled to receive payment of its pro rata share of such fee until such
Lender shall make available such portion, as applicable. Such fee shall be
calculated on the basis of a year of 360 days for the actual number of days
elapsed.
2.9. Deficiency Advances. No Lender shall be responsible for any default of
any other Lender in respect to such other Lender's obligation to make any Loan
hereunder nor shall the Revolving Credit Commitment of any Lender hereunder be
increased as a result of such default of any other Lender. Without limiting the
generality of the foregoing, in the event any Lender shall fail to advance funds
to the Borrowers as herein provided, the Agent may in its discretion, but shall
not be obligated to, advance under the Revolving Note in its favor as a Lender
all or any portion of such amount or amounts (each, a "deficiency advance") and
shall thereafter be entitled to payments of principal of and interest on such
deficiency advance in the same manner and at the same interest rate or rates to
which such other Lender would have been entitled had it made such advance under
its Revolving Note; provided that, upon payment to the Agent from such other
Lender of the entire outstanding amount of each such deficiency advance,
together with accrued and unpaid interest thereon, from the most recent date or
dates interest was paid to the Agent by the Borrowers on each Revolving Loan
comprising the deficiency advance at the interest rate per annum for overnight
borrowing by the Agent from the Federal Reserve Bank, then such payment shall be
credited against the applicable Revolving Note of the Agent in full payment of
such deficiency advance and the Borrowers shall be deemed to have borrowed the
amount of such deficiency advance from such other Lender as of the most recent
date or dates, as the case may be, upon which any payments of interest were made
by the Borrowers thereon.
2.10 Use of Proceeds. The proceeds of the Loans made pursuant to the
Revolving Credit Facility hereunder shall be used by the Borrowers to refinance
certain existing long term indebtedness and for general working capital needs.
2.11 Extension of Revolving Credit Termination Date. At the request of the
Borrowers the Lenders may, in their sole discretion, elect to extend the
Revolving Credit Termination Date then in effect for additional periods of one
year each and thereby restore the Revolving Credit Facility to a three year
maturity. The Borrowers shall notify the Agent of their request for such an
extension by delivering to the Agent notice of such request signed by an
Authorized Representative not more than ninety (90) days nor less than sixty
(60) days prior to an anniversary of the Closing Date. The Agent shall as
promptly as practicable, and in any event within five (5) days, deliver a copy
of such notice to each Lender. If each Lender shall elect to so extend and has
notified the Agent in writing of its election within fifty (50) days of its
receipt of such notice, the Agent shall notify the Borrowers in writing within
sixty (60) days of its receipt of such request for extension of the decision of
any Lender to extend the Revolving Credit Termination Date. Failure by any
Lender to give such notice shall constitute refusal by the Lender to extend the
Revolving Credit Termination Date. In no event shall the Revolving Credit
Termination Date be extended if a prior request for such extension was refused
by the Lenders.
2.12 Appointment of Giant Holding and Authorized Representatives as Agents
for the Borrowers. Each Borrower hereby irrevocably appoints Giant Holding and
each Authorized Representative as its agent and attorney-in-fact for the purpose
of all transactions contemplated by this Agreement or any other Loan Document.
Each Borrower grants to Giant Holding and each Authorized Representative
(whether acting jointly or separately) an irrevocable power of attorney to act
on behalf of such Borrower and to take any and all actions contemplated by any
Loan Document on behalf of each Borrower, including without limitation the
delivery of any Request for Advance/Interest Rate Election or other notice,
request or directive, the receipt or disbursement of any Loans, the execution of
any documents, and the grant or conveyance of any Lien or title.
Article III
The Term Loan Facility
3.1 Term Loan. Subject to the terms and conditions of this Agreement, each
Lender severally agrees to make a Term Loan to the Borrower on the Closing Date
in the amount of $12,000,000 on a pro rata basis determined by the Term Loan
Commitment of such Lender. The principal amount of each Segment of the Term Loan
outstanding hereunder from time to time shall bear interest, at the Borrower's
election, at an interest rate per annum equal to the Base Rate or the Eurodollar
Rate; provided, however, that (x) no Eurodollar Rate Segment shall have an
Interest Period that extends beyond the Term Loan Termination Date, (y) each
Eurodollar Rate Segment shall be in the minimum amount of $10,000 and if
greater, an integral multiple of $10,000, and (z) each Eurodollar Rate Segment
may, subject to the provisions of Sections 3.4, 3.7 and 3.8, be repaid only on
the last day of the Interest Period with respect thereto. No amount of the Term
Loan repaid or prepaid by the Borrowers may be reborrowed hereunder.
3.2 Term Loan Advances.
(a) Not later than 1:00 P.M., Birmingham, Alabama time on the Closing
Date, each Lender shall, pursuant to the terms and subject to the
conditions of this Agreement, initiate a wire transfer to the Agent in the
amount of its pro rata share, determined according to such Lender's
Applicable Commitment Percentage, of the Term Loan. Such wire transfer
shall be directed to the Agent at the Principal Office and shall be in the
form of immediately available funds. The amount so received by the Agent
shall, subject to the terms and conditions of this Agreement, be made
available to the Borrowers by delivery of the proceeds thereof to the
Borrowers' Account or otherwise as shall be directed in the applicable
Borrowing Notice by the Authorized Representative.
3.3 Payment of Interest.
(a) The Borrowers shall pay interest to the Agent for the account of
each Lender on the outstanding and unpaid principal amount of each Segment
of the Term Loan made by such Lender commencing on the date of
determination of the interest rate applicable to such Segment until such
Segment shall be due at the Base Rate applicable for each Business Day
during such period minus one percent (1%) for Base Rate Segments or the
applicable Eurodollar Rate for Eurodollar Rate Segments. The applicable
Eurodollar Rate for any Eurodollar Rate Segment shall be that Eurodollar
Rate available for the entire Interest Period for such Eurodollar Rate
Segment, which Interest Period has been designated by the Authorized
Representative in the Request for Advance/Interest Rate Election and
delivered to the Agent pursuant to either Sections 3.2 or 3.8 hereof. If
any amount shall not be paid when due (at maturity, by acceleration or
otherwise), all amounts outstanding hereunder shall bear interest
commencing on the date when due until, but excluding, the date thereafter
when such amounts past due are paid in full (i) in the case of a Eurodollar
Rate Segment, until the end of the Interest Period with respect to any
Eurodollar Rate Segment at a rate of two percent (2%) above the applicable
Eurodollar Rate for such Eurodollar Rate Segment and thereafter at a rate
per annum which shall be two percent (2%) plus the Base Rate, (ii) with
respect to Base Rate Segments, at a rate of interest per annum which shall
be two percent (2%) above the Base Rate, or (iii) in any case, the maximum
rate permitted by applicable law, if lower.
(b) Interest on each Term Loan Segment shall be computed on the basis
of a year of 360 days and calculated in each case for the actual number of
days elapsed. Interest on each Term Loan Segment shall be paid (i) monthly
in arrears on the last Business Day of each month commencing January 31,
1998 for each Base Rate Segment, (ii) on the last day of the applicable
Interest Period for each Eurodollar Rate Segment and (iii) upon payment in
full of the principal amount of the Term Loan.
3.4 Payment of Principal.
(a) The principal amount of the Term Loan shall be repaid in sixty
(60) consecutive monthly installments of $200,000 each on the last Business
Day of each month commencing on January 31, 1998; provided, however, that
the entire amount of Term Loan Outstandings shall be due and payable in
full on the Term Loan Termination Date.
(b) Each payment of principal (including any prepayment) and payment
of interest and fees, and any other amount required to be paid to the
Lenders with respect to the Term Loan, shall be made to the Agent at the
Principal Office, for the account of each Lender, in Dollars and in
immediately available funds before 3:00 P.M. Birmingham, Alabama time on
the date such payment is due. The Agent may, but shall not be obligated to,
debit the amount of any such payment which is not made by such time to any
ordinary deposit account, if any, of any one or more Borrowers with the
Agent.
(c) The Agent shall deem any payment by or on behalf of the Borrowers
hereunder that is not made both in Dollars and in immediately available
funds and prior to 3:00 P.M. Birmingham, Alabama time to be a
non-conforming payment. Any such payment shall not be deemed to be received
by the Agent until the later of (i) the time such funds become available
funds and (ii) the next Business Day. Any non-conforming payment may
constitute or become a Default or Event of Default pursuant to Section
10.1(b) hereof. Interest shall continue to accrue on any principal as to
which a non-conforming payment is made until the later of (x) the date such
funds become available funds or (y) the next Business Day at the respective
rates of interest per annum specified in the proviso to Section 3.3 hereof
regarding interest on late payments, from the date such amount was due and
payable.
(d) In the event that any payment hereunder or under the Term Notes
becomes due and payable on a day other than a Business Day, then such due
date shall be extended to the next succeeding Business Day unless provided
otherwise under clause (ii) of the definition of "Interest Period";
provided that interest shall continue to accrue during the period of any
such extension and provided further, that in no event shall any such due
date be extended beyond the Term Loan Termination Date.
3.5 Use of Proceeds. The proceeds of the Loans made pursuant to the Term
Loan Facility shall be used by the Borrowers to refinance indebtedness of Solite
Corporation in connection with the Solite Transaction and pursuant to the Solite
Documents.
3.6 Term Notes. The Term Loan made by each Lender shall be evidenced by,
and be repayable with interest in accordance with the terms of, a Term Note
payable to the order of such Lender in the amount of its Applicable Commitment
Percentage of the Total Term Loan Commitment, which Term Note shall be dated the
Closing Date or such later date pursuant to an Assignment and Acceptance and
shall be duly completed, executed and delivered by the Borrowers.
3.7 Prepayment of Term Loan.
(a) The Borrowers may prepay up to $1,000,000 of the principal amount
of the Term Loan from operating cash flow in any calendar year on any
Business Day, without penalty or premium, upon not less than two (2)
Business Days' prior written notice (effective upon receipt) to the Lender,
which notice shall be irrevocable. Any prepayment permitted under this
Section 3.7(a) shall be made at a prepayment price equal to the amount of
principal to be prepaid. All prepayments under this Section 3.7 shall be
made in the minimum principal amount of $100,000 or any integral multiple
of $25,000 in excess thereof, and all such prepayments of principal shall
be applied to installments of principal in inverse order of their
maturities.
(b) The Borrowers may also prepay the Term Loan in whole or in part
either (a) from a source other than operating cash flow or (b) in an amount
in excess of $1,000,000 in any calendar year, in each case at a prepayment
price equal to (i), (A) in the case of a partial prepayment, the amount of
principal to be prepaid and (B) in the case of a full prepayment, the
amount of principal plus all accrued and unpaid interest on the amount of
such principal to the date of prepayment, plus (ii) a prepayment premium on
the amount so prepaid set forth below.
Date Prepayment Premium
If made on or prior to April 30, 1999 1.00%
If made after April 30, 1999 and
on or prior to April 30, 2000 0.5%
If made after April 30, 2000 0.25%
All prepayments under this Section 3.7(b) shall be made on a Business
Day upon not less than two (2) Business Days' prior written notice
(effective upon receipt) to the Lender, which notice shall be irrevocable,
and shall be in the minimum principal amount of $100,000 or any integral
multiple of $25,000 in excess thereof. All such prepayments of principal
shall be applied to installments of principal in inverse order of their
maturities.
3.8 Conversions and Elections of Subsequent Interest Periods. The Borrowers
may:
(a) upon delivery of a properly completed Request For Advance/Interest
Rate Election to the Agent on or before 10:30 A.M. Birmingham, Alabama time
on any Business Day, convert all or a part of Eurodollar Rate Segments to
Base Rate Segments on the last day of the Interest Period for such
Eurodollar Rate Segments; and
(b) provided that no Default or Event of Default shall have occurred
and be continuing and subject to the limitations set forth below and in
Article V hereof, upon delivery of a properly completed Request For
Advance/Interest Rate Election to the Agent on or before 10:30 A.M.
Birmingham, Alabama time three (3) Business Days' prior to the date of such
election or conversion, convert Base Rate Segments to Eurodollar Rate
Segments on any date, or continue any Eurodollar Rate Segment by election
of a subsequent Interest Period therefor on the last day of the Interest
Period for such Eurodollar Rate Segment.
Each conversion pursuant to this Section 3.8 shall be subject to the
limitations on Eurodollar Rate Loans set forth in the definition of "Interest
Period" herein and in Sections 3.1, 3.4 and Article V hereof. The Agent shall
give written notice to each Lender of such notice of election or conversion
prior to 3:00 P.M. Birmingham, Alabama time on the day such notice of conversion
is received. If the Agent does not receive a notice of election of duration of
an Interest Period or to convert an outstanding Eurodollar Rate Segment by the
time prescribed above, the Borrower shall be deemed to have elected to convert
such Eurodollar Rate Segment to a Base Rate Segment on the last day of the
Interest Period for such Eurodollar Rate Segment. All such continuations or
conversions of Segments shall be effected pro rata based on the Applicable
Commitment Percentages of the Lenders.
ARTICLE IV
The Letter of Credit Facility
4.1 Letters of Credit. Issuing Bank agrees, subject to the terms and
conditions of this Agreement, upon request and for the account of Borrowers, to
issue from time to time up to and including the Revolving Credit Termination
Date Letters of Credit upon delivery to Issuing Bank of an Application for
Letter of Credit in form and content acceptable to Issuing Bank; provided, that
the Letter of Credit Outstandings shall not exceed the Total Letter of Credit
Commitment. No Letter of Credit shall be issued by Issuing Bank with an expiry
date (including any automatic renewal thereof in accordance with the terms of
such Letter of Credit) or payment date occurring subsequent to the fifth
Business Day preceding the Revolving Credit Termination Date.
4.2 Reimbursement.
(a) The Borrowers hereby unconditionally agree immediately to pay to
Issuing Bank on demand at the Principal Office in immediately available
funds all amounts required to pay all drafts drawn and honored under
Letters of Credit and all reasonable expenses incurred by Issuing Bank in
connection with Letters of Credit and in any event and without demand to
place in possession of Issuing Bank sufficient funds to pay all debts and
liabilities arising under any Letter of Credit; provided that to the extent
permitted by Section 2.1(d)(iv) hereof, such amounts shall be paid pursuant
to Advances. The Borrowers' obligation to pay Issuing Bank under this
Section 4.2, and Issuing Bank's right to receive such payment, shall be
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including without limitation the unavailability of any Advance.
Issuing Bank shall give the Borrowers prompt written notice of any request
for a draw under a Letter of Credit. In the event an Advance is not
available, Issuing Bank may charge any account the Borrowers may have with
it for any and all amounts Issuing Bank pays under a Letter of Credit, plus
charges and reasonable expenses as from time to time agreed to by Issuing
Bank and the Borrowers. The Borrowers agree to pay Issuing Bank interest on
any amounts paid by the Issuing Bank in connection with drafts drawn and
honored under Letters of Credit when due hereunder, and which is not paid
pursuant to Advances as herein contemplated or otherwise paid by the
Borrowers in immediately available funds not later than the first Business
Day after the date of such drawing, at the Default Rate from the first
Business Day after the date of such drawing to the date such amount is paid
in full.
(b) In accordance with the provisions of Section 2.1(d)(iv) hereof,
Issuing Bank shall notify the Agent and the Borrowers of any drawing under
any Letter of Credit as promptly as practicable following the receipt by
Issuing Bank of such drawing.
(c) Each Lender (other than Issuing Bank) shall automatically acquire
on the date of issuance thereof a Participation in the liability of Issuing
Bank in respect of each Letter of Credit in an amount equal to such
Lender's Applicable Commitment Percentage of such liability, and to the
extent that the Borrowers are obligated to pay Issuing Bank under Section
4A.2(a) hereof, each Lender (other than Issuing Bank) thereby shall, as
hereinafter described, absolutely, unconditionally and irrevocably assume,
and shall be unconditionally obligated to pay to Issuing Bank, its
Applicable Commitment Percentage of the liability of Issuing Bank under
such Letter of Credit.
(i)Prior to the Revolving Credit Termination Date, each Lender
(other than Issuing Bank) shall, subject to the terms and conditions
of Article II, make a Revolving Loan bearing interest at the Base Rate
to the Borrowers by paying to the Agent for the account of Issuing
Bank at the Principal Office in Dollars and in immediately available
funds an amount equal to its Applicable Commitment Percentage of any
Reimbursement Obligation, all as described in and pursuant to Section
2.1(d).
(ii)With respect to drawings under any Letter of Credit for which
a Revolving Loan is not made as set forth in clause (i) above, each
Lender (other than Issuing Bank) upon receipt from the Agent of notice
of a drawing in the manner described in Section 2.1(d)(iv), shall
promptly pay to the Agent for the account of Issuing Bank, prior to
the applicable time set forth in Section 2.1(d)(iv), its Applicable
Commitment Percentage of such drawing. Simultaneously with the making
of each such payment by a Lender to the Agent for the account of
Issuing Bank, such Lender shall, automatically and without any further
action on the part of Issuing Bank or such Lender, acquire a
Participation in an amount equal to such payment (excluding the
portion thereof constituting interest) in the related Reimbursement
Obligation of the Borrowers.
(iii)Each Lender's obligation to make payment to the Agent for
the account of Issuing Bank pursuant to this Section 4.2(c), and the
right of Issuing Bank to receive the same, shall be made without any
offset, abatement, withholding or reduction whatsoever. If any Lender
is obligated to pay but does not pay amounts to the Agent for the
account of the Issuing Bank in full upon such request as required by
this Section 4.2(c), such Lender shall, on demand, pay to the Agent
for the account of Issuing Bank interest on the unpaid amount for each
day during the period commencing on the date of notice given to such
Lender pursuant to Section 4.2(c) hereof until such Lender pays such
amount to the Agent for the account of Issuing Bank in full at the
interest rate per annum for overnight borrowings by Issuing Bank from
the Federal Reserve Bank.
(iv) In the event the Lenders have purchased Participations in
any Reimbursement Obligation as set forth in clause (ii) above, then
at any time payment of such Reimbursement Obligation, in whole or in
part, is received by Issuing Bank from the Borrowers, Issuing Bank
shall pay to each Lender an amount equal to its Applicable Commitment
Percentage of such payment from the Borrowers.
(d) Promptly following the end of each calendar month, Issuing Bank
shall deliver to the Agent, and the Agent shall deliver to each Lender, a
notice describing the aggregate undrawn amount of all Letters of Credit at
the end of such month. Upon the request of any Lender from time to time,
Issuing Bank shall deliver to the Agent, and the Agent shall deliver to
such Lender, any other information reasonably requested by such Lender with
respect to Letter of Credit Outstandings.
(e) The issuance by Issuing Bank of each Letter of Credit shall, in
addition to the conditions precedent set forth in Section 6.1 hereof, be
subject to the conditions that such Letter of Credit be in such form and
contain such terms as shall be reasonably satisfactory to Issuing Bank
consistent with the then current practices and procedures of Issuing Bank
with respect to similar letters of credit, and the Borrowers shall have
executed and delivered such other instruments and agreements relating to
such Letters of Credit as Issuing Bank shall have reasonably requested
consistent with such practices and procedures. All Letters of Credit shall
be issued pursuant to and subject to the Uniform Customs and Practice for
Documentary Credits, 1993 revision, International Chamber of Commerce
Publication No. 500 and all subsequent amendments and revisions thereto.
(f) The Borrowers agree that Issuing Bank may, in its sole discretion,
accept or pay, as complying with the terms of any Letter of Credit, any
drafts or other documents otherwise in order which may be signed or issued
by an administrator, executor, trustee in bankruptcy, debtor in possession,
assignee for the benefit of creditors, liquidator, receiver, attorney in
fact or other legal representative of a party who is authorized under such
Letter of Credit to draw or issue any drafts or other documents.
(g) Without duplication of Section 11.6 hereof, the Borrowers hereby
agree to defend, indemnify and hold harmless Issuing Bank, each other
Lender and the Agent from and against any and all claims and damages,
losses, liabilities, reasonable costs and expenses which Issuing Bank, such
other Lender or the Agent may incur (or which may be claimed against
Issuing Bank, such other Lender or the Agent) by any Person by reason of or
in connection with the issuance or transfer of or payment or failure to pay
under any Letter of Credit; provided that the Borrowers shall not be
required to indemnify Issuing Bank, any other Lender or the Agent for any
claims, damages, losses, liabilities, costs or expenses to the extent, but
only to the extent, caused by the willful misconduct or gross negligence of
the party to be indemnified. The provisions of this Section 4.2(g) shall
survive repayment of the Obligations, the occurrence of the Revolving
Credit Termination Date and expiration or termination of this Agreement.
(h) Without limiting Borrowers' rights as set forth in Section 4.2(g)
above, the obligation of the Borrowers to immediately reimburse the Agent
for drawings made under Letters of Credit shall be absolute, unconditional
and irrevocable, and shall be performed strictly in accordance with the
terms of this Agreement and such Letters of Credit and the related
Applications for Letters of Credit, notwithstanding the following
circumstances:
(i)any lack of validity or enforceability of the Letter of
Credit, the obligation supported by the Letter of Credit or any other
agreement or instrument relating thereto (collectively, the "Related
Documents");
(ii)any amendment or waiver of or any consent to or departure
from all or any of the Related Documents;
(iii)the existence of any claim, setoff, defense or other rights
which the Borrowers may have at any time against any beneficiary or
any transferee of a Letter of Credit (or any Persons for whom any such
beneficiary or any such transferee may be acting), Agent, Lenders or
any other Person, whether in connection with the Loan Documents, the
Related Documents or any unrelated transaction;
(iv)any breach of contract or other dispute between the Borrowers
and any beneficiary or any transferee of a Letter of Credit (or any
persons or entities for whom such beneficiary or any such transferee
may be acting), Agent, Lenders or any other Person;
(v)any draft, statement or any other document presented under the
Letter of Credit proving to be forged, fraudulent or invalid in any
respect or any statement therein being untrue or inaccurate in any
respect whatsoever; or
(vi) any delay, extension of time, renewal, compromise or other
indulgence or modification granted or agreed to by Agent, with or
without notice to or approval by the Borrowers in respect of any of
Borrowers' Obligations under this Agreement.
4.3 Letter of Credit Fee. The Borrowers agree to pay to the Agent, for the
pro rata benefit of the Lenders based on their Applicable Commitment
Percentages, quarterly in arrears on the last Business Day of each March, June,
September and December, beginning June 1998, a fee for each Standby Letter of
Credit, equal to the product of the average daily amount available to be drawn
on such Letter of Credit during such three month period multiplied by one
percent (1.00%). Such fee shall be calculated on the basis of a year of 360 days
for the actual number of days during which Letters of Credit are outstanding.
4.4 Administrative Fees. The Borrowers shall pay to Issuing Bank such
administrative fee and other fees, if any, in connection with the Letters of
Credit in such amounts and at such times as Issuing Bank and the Borrowers shall
agree from time to time.
ARTICLE V
Yield Protection and Illegality
5.1 Additional Costs.
(a) The Borrowers shall promptly pay to the Agent for the account of a
Lender from time to time, without duplication, such amounts as such Lender
may reasonably determine to be necessary to compensate it for any costs
incurred by such Lender which it determines are attributable to its making
or maintaining any Loan or its obligation to make any Loans, or the
issuance or maintenance by Issuing Bank of or any other Lender's
Participation in any Letter of Credit issued hereunder, or any reduction in
any amount receivable by such Lender under this Agreement or the Notes in
respect of any of such Loans, including reductions in the rate of return on
a Lender's capital (such increases in costs and reductions in amounts
receivable and returns being herein called "Additional Costs"), resulting
from any Regulatory Change which: (i) changes the basis of taxation of any
amounts payable to such Lender under this Agreement or the Notes in respect
of any of such Loans (other than taxes imposed on or measured by the
income, revenues or assets); or (ii) imposes or modifies any reserve,
special deposit, or similar requirements relating to any extensions of
credit or other assets of, or any deposits with or other liabilities of,
such Lender (other than any such reserve, deposit or requirement reflected
in the Base Rate or the Eurodollar Rate, in each case computed in
accordance with the respective definitions of such terms set forth in
Section 1.2 hereof); or (iii) has or would have the effect of reducing the
rate of return on capital of any such Lender to a level below that which
the Lender could have achieved but for such Regulatory Change (taking into
consideration such Lender's policies with respect to capital adequacy).
Each Lender will notify the Authorized Representative and the Agent of any
event occurring after the Closing Date which would entitle it to
compensation pursuant to this Section 5.1(a) as promptly as practicable
after it obtains knowledge thereof and determines to request such
compensation.
(b) Without limiting the effect of the foregoing provisions of this
Section 5.1, in the event that, by reason of any Regulatory Change, any
Lender either (i) incurs Additional Costs based on or measured by the
excess above a specified level of the amount of a category of deposits or
other liabilities of the Lender which includes deposits by reference to
which the interest rate on Eurodollar Rate Loans is determined as provided
in this Agreement or a category of extensions of credit or other assets of
any Lender which includes Eurodollar Rate Loans or (ii) becomes subject to
restrictions on the amount of such a category of liabilities or assets
which it may hold, then, if the Lender so elects by notice to the other
Lenders, the obligation hereunder of such Lender to make, and to convert
Base Rate Loans into, Eurodollar Rate Loans that are the subject of such
restrictions shall be suspended until the date such Regulatory Change
ceases to be in effect and the Borrowers shall, on the last day(s) of the
then current Interest Period(s) for outstanding Eurodollar Rate Loans
convert such Eurodollar Rate Loans into Base Rate Loans; provided, however,
that the suspension of such obligation and the conversion of any Eurodollar
Rate Loans into Base Rate Loans shall apply only to any Lender who is
affected by such restrictions and who has provided such notice to the other
Lenders, and the obligation of the other Lenders to make, and to convert
Base Rate Loans into, Eurodollar Rate Loans shall not be affected by such
restrictions.
(c) Determinations by any Lender for purposes of this Section 5.1 of
the effect of any Regulatory Change on its costs of making or maintaining,
or being committed to make Loans, or by Issuing Bank as issuer of any
Letter of Credit of the effect of any Regulatory Change on its costs in
connection with the issuance or maintenance of, or any other Lender's
Participation in, any Letter of Credit issued hereunder, or on amounts
receivable by any Lender in respect of Loans or Letters of Credit, and of
the additional amounts required to compensate the Lender in respect of any
Additional Costs, shall be conclusive absent manifest error. The Lender
requesting such compensation shall furnish to the Authorized Representative
and the Agent within sixty (60) days of the incurrence of any Additional
Costs for which compensation is sought an explanation of the Regulatory
Change and calculations, in reasonable detail, setting forth such Lender's
determination of any such Additional Costs.
5.2 Suspension of Loans. Anything herein to the contrary notwithstanding,
if, on or prior to the determination of any interest rate for any Eurodollar
Rate Loan for any Interest Period, the Agent determines (which determination
made on a reasonable basis shall be conclusive absent manifest error) that:
(a) quotations of interest rates for the relevant deposits referred to
in the definition of "Interbank Offered Rate" in Section 1.2 hereof are not
being provided in the relevant amounts or for the relevant maturities for
purposes of determining the rate of interest for such Eurodollar Rate Loan
as provided in this Agreement; or
(b) the relevant rates of interest referred to in the definition of
"Interbank Offered Rate" in Section 1.2 hereof upon the basis of which the
Eurodollar Rate for such Interest Period is to be determined do not
adequately reflect the cost to the Lenders of making or maintaining such
Eurodollar Rate Loan for such Interest Period or such Eurodollar Rate Loan
(which determination shall be made on a reasonable basis by the Agent, and
the Person making such determination shall furnish the Authorized
Representative evidence of the facts leading to such determination);
then the Agent shall give the Authorized Representative prompt notice thereof,
and so long as such condition remains in effect, the Lenders shall be under no
obligation to make Eurodollar Rate Loans that are subject to such condition, or
to convert Loans into Eurodollar Rate Loans, and the Borrowers shall on the last
day(s) of the then current Interest Period(s) for outstanding Eurodollar Rate
Loans, as applicable, convert such Eurodollar Rate Loans into Base Rate Loans.
The Agent shall give the Authorized Representative notice describing in
reasonable detail any event or condition described in this Section 5.2 promptly
following the determination by the Agent that the availability of Eurodollar
Rate Loans is, or is to be, suspended as a result thereof.
5.3 Illegality. Notwithstanding any other provision of this Agreement, in
the event that it becomes unlawful for any Lender to honor its obligation to
make or maintain Eurodollar Rate Loans hereunder, then such Lender shall
promptly notify the Borrowers thereof (with a copy to the Agent) and such
Lender's obligation to make or continue Eurodollar Rate Loans, or convert Base
Rate Loans into Eurodollar Rate Loans, shall be suspended until such time as
such Lender may again make and maintain Eurodollar Rate Loans, and such Lender's
outstanding Eurodollar Rate Loans shall be converted into Base Rate Loans in
accordance with Section 2.7 hereof.
5.4 Compensation. The Borrowers shall promptly pay to each Lender, upon the
request of such Lender, such amount or amounts as shall be sufficient (in the
reasonable determination of Lender) to compensate it for any loss, cost or
expense incurred by it as a result of:
(a) any payment, prepayment or conversion of a Eurodollar Rate Loan on
a date other than the last day of the Interest Period for such Eurodollar
Rate Loan, including without limitation any prepayment made pursuant to
Section 3.7 hereof and any conversion required pursuant to Section 5.3
hereof; or
(b) any failure by the Borrowers to borrow a Eurodollar Rate Loan on
the date for such borrowing specified in the relevant Request for
Advance/Interest Rate Election under Article II hereof;
such compensation to include, without limitation, an amount equal to the excess,
if any, of (i) the amount of interest which would have accrued on the principal
amount so paid, prepaid or converted or not borrowed for the period from the
date of such payment, prepayment or conversion or failure to borrow or convert
to the last day of the then current Interest Period for such Loan (or, in the
case of a failure to borrow or convert, the Interest Period for such Loan which
would have commenced on the date scheduled for such borrowing or conversion) at
the applicable rate of interest for such Eurodollar Rate Loan provided for
herein over (ii) the Interbank Offered Rate (as reasonably determined by the
Agent) for Dollar deposits of amounts comparable to such principal amount and
maturities comparable to such period. A determination of a Lender as to the
amounts payable pursuant to this Section 5.4 shall be conclusive absent manifest
error. The Lender requesting compensation under this Section 5.4 shall promptly
furnish to the Authorized Representative and the Agent calculations in
reasonable detail setting forth such Lender's determination of the amount of
such compensation.
5.5 Alternate Loan and Lender. In the event any Lender suspends the making
of any Eurodollar Rate Loan pursuant to this Article V (herein a "Restricted
Lender"), the Restricted Lender's Applicable Commitment Percentage of any
Eurodollar Rate Loan shall bear interest at the Base Rate until the Restricted
Lender once again makes available the applicable Eurodollar Rate Loan.
Notwithstanding the provisions of Section 2.2(b) hereof, interest shall be
payable to the Restricted Lender at the time and manner as paid to those Lenders
making available Eurodollar Rate Loans.
5.6 Taxes.
(a) All payments by the Borrowers of principal of, and interest on,
the Loans and all other amounts payable hereunder shall be made free and
clear of and without deduction for any present or future excise, stamp or
other taxes, fees, duties, levies, imposts, charges, deductions,
withholdings or other charges of any nature whatsoever imposed by any
taxing authority, but excluding (i) franchise taxes, (ii) any taxes (other
than withholding taxes) that would not be imposed but for a connection
between a Lender or the Agent and the jurisdiction imposing such taxes
(other than a connection arising solely by virtue of the activities of such
Lender or the Agent pursuant to or in respect of this Agreement or any
other Loan Document), (iii) any withholding taxes payable with respect to
payments hereunder or under any other Loan Document under laws (including,
without limitation, any statute, treaty, ruling, determination or
regulation) in effect on the Closing Date, (iv) any taxes imposed on or
measured by any Lender's assets, net income, receipts or branch profits and
(v) any taxes arising after the Closing Date solely as a result of or
attributable to Lender changing its designated lending office after the
date such Lender becomes a party hereto (such non-excluded items being
collectively called "Taxes"). In the event that any withholding or
deduction from any payment to be made by the Borrowers hereunder is
required in respect of any Taxes pursuant to any applicable law, rule or
regulation, then the Borrowers will
(i) pay directly to the relevant authority the full amount
required to be so withheld or deducted;
(ii) promptly forward to the Agent an official receipt or other
documentation satisfactory to the Agent evidencing such payment to
such authority; and
(iii) pay to the Agent for the account of each Lender such
additional amount or amounts as is necessary to ensure that the net
amount actually received by each Lender will equal the full amount
such Lender would have received had no such withholding or deduction
been required.
(b) Prior to the date that any Lender organized under the laws of a
jurisdiction outside the United States becomes a party hereto, such Person
shall deliver to the Borrowers and the Agent such certificates, documents
or other evidence, as required by the Code or Treasury Regulations issued
pursuant thereto, properly completed, currently effective and duly executed
by such Lender or participant establishing that such payment is (i) not
subject to United States Federal backup withholding tax and (ii) not
subject to United States Federal withholding tax under the Code because
such payment is either effectively connected with the conduct by such
Lender or participant of a trade or business in the United States or
totally exempt from United States Federal withholding tax by reason of the
application of the provisions of a treaty to which the United States is a
party or such Lender is otherwise exempt.
(c) If any Borrower fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to the Agent, for the account of the
respective Lender, the required receipts or other required documentary
evidence, all the Borrowers shall jointly and severally indemnify the
Lenders for any incremental Taxes, interest or penalties that may become
payable by any Lender as a result of any such failure. For purposes of this
Section 5.6, a distribution hereunder by the Agent or any Lender to or for
the account of the Borrowers shall be deemed a payment on behalf of the
Borrowers.
ARTICLE VI
Conditions Precedent
6.1 Conditions of Initial Advance and Issuance of Letters of Credit. The
obligation of the Lenders to make the initial Advance is subject to the
following conditions precedent:
(a) The Agent shall have received on the Closing Date, in form and
substance satisfactory to the Agent and Lenders, the following:
(i) executed originals of each of this Agreement, the Notes, the
Security Agreement and the other Loan Documents, together with all
schedules and exhibits thereto;
(ii) written opinions of special counsel to the Borrowers,
including special counsel in South Carolina, North Carolina, Alabama,
Pennsylvania and Virginia with respect to Collateral located in such
jurisdictions, dated the Closing Date, addressed to the Agent and the
Lenders in the form of Exhibit H attached hereto or with such changes
to such form as are satisfactory to the Agent;
(iii) resolutions of the boards of directors or other appropriate
governing body (or of the appropriate committee thereof) of each
Borrower certified by its secretary or assistant secretary as of the
Closing Date, appointing the initial Authorized Representative and
approving and adopting the Loan Documents to be executed by such
Person, and authorizing the execution and delivery thereof;
(iv) specimen signatures of officers of each Borrower executing
the Loan Documents on behalf of each Borrower, certified by the
secretary or assistant secretary of each Borrower;
(v) the charter documents of each Borrower certified as of a
recent date by the Secretary of State of its state of incorporation or
certification from the secretary or assistant secretary of each
Borrower as to no change in the charter documents of such Borrower
since the date of the Existing Agreement;
(vi) the bylaws of each Borrower certified as of the Closing Date
as true and correct by its secretary or assistant secretary or
certification from the secretary or assistant secretary of each
Borrower as to no change in the bylaws of such Borrower since the date
of the Existing Agreement;
(vii) certificates issued as of a recent date by the Secretary of
State of each of jurisdiction of incorporation of each Borrower as to
the due existence and good standing of such Borrower;
(viii) appropriate certificates of qualification to do business,
good standing and, where appropriate, authority to conduct business
under assumed name, issued in respect of each Borrower as of a recent
date by the Secretary of State or comparable official of each
jurisdiction in which the failure to be qualified to do business or
authorized so to conduct business could have a Material Adverse
Effect;
(ix) certificate of an Authorized Representative dated the
Closing Date demonstrating compliance with the financial covenants
contained in Sections 9.1 through 9.5 as of the Closing Date,
substantially in the form of Exhibit I attached hereto; provided,
however, that such certificate shall be prepared on a proforma basis
after giving effect to the Solite Transaction;
(x) evidence of all policies of casualty insurance required by
the Loan Documents with respect to the Equipment and to the assets of
Solite Corporation and its Subsidiaries, together with endorsements
naming Agent for the benefit of the Lenders as an additional insured,
mortgagee or loss payee, as applicable;
(xi) executed Uniform Commercial Code financing statements with
respect to the Equipment and to the assets of Solite Corporation and
its Subsidiaries in such form and number as requested by the Agent;
(xii) an initial Request for Advance/Interest Rate Election with
respect to the Term Loan;
(xiii) an initial Application for Letters of Credit;
(xiv) all fees payable by the Borrowers on the Closing Date to
the Agent, Issuing Bank and the Lenders;
(xv) UCC search results with respect to the Equipment and to
Solite Corporation and its Subsidiaries subject to the Solite
Transaction showing only those liens and security interests as are
acceptable to the Lenders;
(xvi) Termination and Release Agreement between First Union
National Bank (as successor to Signet Bank/Virginia) ("First"), as
collateral agent for each of (i) Central Fidelity Bank, (ii) Mutual of
Omaha Insurance Company, (iii) United of Omaha Life Insurance Company,
(iv)United World Life Insurance Company and (v) Companion Life
Insurance Company (the "Solite Lenders")and the Agent regarding
existing indebtedness of Solite Corporation;
(xvii) UCC-3 Termination Statements by Signet, as collateral
agent for the Solite Lenders;
(xviii) Deed of Trust/Mortgage Releases for each existing deed of
trust or mortgage with respect to the properties of Solite Corporation
or its Subsidiaries in the following locations:
(a) Buckingham County, Virginia;
(b) Pittsylvania County, Virginia;
(c) Rockingham County, North Carolina;
(d) Stanly County, North Carolina;
(e) Clay County, Florida;
(xviv) executed copies of the Solite Documents certified by the
secretary or an assistant secretary of Giant Holding to be true,
correct and complete;
(xx) a certificate of the Borrowers that the total amount of
indebtedness assumed by the Borrowers in the Solite Transaction does
not exceed $20,000,000 and that the total amount of stock of Giant
Holding used as consideration in the Solite Transaction does not
exceed 650,000 shares;
(xxi) a certificate by an authorized officer of Solite
Corporation that (X) the Agent may rely on the representations and
warranties of Solite Corporation contained in the Solite Documents and
(Y) that all conditions to effectiveness of the Solite Documents have
been satisfied other than the funding of the consideration for the
Solite Transaction;
(xxii) a letter from the counsel to Solite Corporation that the
Agent and the Lenders may rely on the opinion given by such counsel in
the Solite Transaction;
(xxiii) written evidence acceptable to the Agent that the
aggregate net book value of the Equipment as of the most recently
completed fiscal period for which financial statements have been
delivered by the Borrowers to the Agent is not less than $15,000,000;
(xxiv) such other documents, instruments, certificates and
opinions as the Agent or any Lender may reasonably request on or prior
to the Closing Date in connection with the consummation of the
transactions contemplated hereby.
(b) Each of the following shall have occurred or be true:
(i) there shall not be any action, suit, investigation or
proceeding pending or threatened in any court or before any arbitrator
or governmental authority that purports to affect (A) any Borrower
that could have a Material Adverse Effect, or (B) any transaction
contemplated hereby; and
(ii) no Borrower shall be in default with respect to any existing
financial obligations.
(c) In the good faith judgment of the Agent and the Lenders:
(i) there shall not have occurred any Material Adverse Effect
since December 31, 1997;
(ii) there shall not have occurred any disruption or adverse
change in the financial or capital markets generally which the Agent,
in its sole reasonable discretion, deems material in connection with
the Revolving Credit Facility; and
(iii) the Agent shall have received and reviewed, with results
satisfactory to the Agent and its counsel, all information it may
reasonably request regarding the Borrowers.
6.2 Conditions of Loans and Issuance of Letters of Credit. The obligations
of the Lenders to make any Loans hereunder on or subsequent to the Closing Date
are subject to the satisfaction of the following conditions:
(a) the Agent shall have received a Request for Advance/Interest Rate
Election as required by Article II or Article III hereof;
(b) the representations and warranties of the Borrowers set forth in
Article VII hereof and in each of the other Loan Documents shall be true
and correct in all material respects on and as of the date of such Advance,
with the same effect as though such representations and warranties had been
made on and as of such date, except to the extent that such representations
and warranties expressly relate to an earlier date and except that the
financial statements referred to in Section 7.6(a) hereof shall be deemed
to be those financial statements most recently delivered to the Agent and
the Lenders pursuant to Section 8.1 hereof;
(c) in the case of the issuance of a Letter of Credit, Borrowers shall
have executed and delivered to Issuing Bank an Application for Letter of
Credit in form and content acceptable to Issuing Bank together with such
other instruments and documents as it shall reasonably request;
(d) at the time of each Advance, conversion, continuation or issuance
of each Letter of Credit, as the case may be, no Default or Event of
Default specified in Article X hereof, shall have occurred and be
continuing;
(e) immediately after issuing any Letter of Credit, the aggregate
Letter of Credit Outstandings shall not exceed the Total Letter of Credit
Commitment;
(f) the Borrowers have maintained, on a consolidated basis, to the
reasonable satisfaction of the Agent and the Lenders a financial condition
in which they, considered as a whole, may repay the Obligations, including
each Advance to be made at such time, from Consolidated EBITDA derived from
operations; and
(g) immediately after giving effect to a Revolving Loan, the aggregate
principal balance of all outstanding Revolving Loans for each Lender and in
the aggregate shall not exceed, respectively, (i) such Lender's Revolving
Credit Commitment or (ii) the Total Revolving Credit Commitment.
ARTICLE VII
Representations and Warranties
Each Borrower represents and warrants that:
7.1 Organization and Authority.
(a) Each Borrower is a corporation duly organized and validly existing
under the laws of the jurisdiction of its incorporation;
(b) Each Borrower (x) has the requisite power and authority to own its
properties and assets and to carry on its business as now being conducted
and as contemplated in the Loan Documents, and (y) is qualified to do
business in every jurisdiction in which failure so to qualify would have a
Material Adverse Effect;
(c) Each Borrower has the power and authority to execute, deliver and
perform this Agreement and the Notes, and to borrow hereunder, and to
execute, deliver and perform each of the other Loan Documents to which it
is a party; and
(d) when executed and delivered, each of the Loan Documents to which
each Borrower is a party is the legal, valid and binding obligation or
agreement, as the case may be, of such Borrower, enforceable against such
Borrower in accordance with its terms, subject to the effect of any
applicable bankruptcy, moratorium, insolvency, reorganization or other
similar law affecting the enforceability of creditors' rights generally and
to the effect of general principles of equity which may limit the
availability of equitable remedies (whether in a proceeding at law or in
equity).
7.2 Loan Documents. The execution, delivery and performance by each
Borrower of each of the Loan Documents to which it is a party:
(a) have been duly authorized by all requisite corporate action
(including any required shareholder approval) of such Borrower required for
the lawful execution, delivery and performance thereof;
(b) do not violate any provisions of (i) applicable law, rule or
regulation, (ii) any order of any court or other agency of government
binding on such Borrower, or its properties, or (iii) the charter documents
or bylaws of such Borrower, except to the extent such violation would not
or would not be reasonably likely to have a Material Adverse Effect;
(c) does not and will not be in conflict with, result in a breach of
or constitute an event of default, or an event which, with notice or lapse
of time, or both, would constitute an event of default, under any material
indenture, agreement or other instrument to which such Borrower is a party,
or by which the properties or assets of such Borrower are bound;
(d) does not and will not result in the creation or imposition of any
Lien, charge or encumbrance of any nature whatsoever upon any of the
properties or assets of Borrower except any liens in favor of the Agent and
the Lenders created by the Security Documents.
7.3 Solvency. Each Borrower is Solvent after giving effect to the
transactions contemplated by this Agreement and the other Loan Documents.
7.4 Subsidiaries and Stockholders. None of the Borrowers has any Subsidiary
which is not a Borrower.
7.5 Ownership Interests. None of the Borrowers owns any interest in any
Person other than the Persons listed in Schedule 7.5 hereto.
7.6 Financial Condition.
(a) Giant Cement has furnished to the Agent the audited consolidated
balance sheet of the Borrowers as of December 31, 1997 and the notes
thereto and the related consolidated statements of operations, cash flows,
and shareholders' equity for the Fiscal Year then ended as examined and
certified by Coopers & Xxxxxxx as the independent certified public
accountants of the Borrowers. Except as set forth therein, such financial
statements (including the notes thereto), present fairly the consolidated
financial position of the Borrowers, as of the end of such Fiscal Year, all
in conformity with GAAP applied on a Consistent Basis;
(b) since December 31, 1997, there has not occurred any event,
including but not limited to fire, explosion or other accident, earthquake,
flood, drought, storm or other act of God, strike, lockout, combination of
workers or other labor matter, or embargo or act of a public enemy which
has had or could reasonably be expected to have a Material Adverse Effect;
(c) since December 31, 1997, except as set forth in Schedule 7.6
hereto, no Borrower has incurred any material Consolidated Indebtedness
that remains outstanding or unsatisfied. Schedule 7.6 hereto sets forth all
Consolidated Indebtedness of the Borrower and its Subsidiaries.
7.7 Title to Properties. The Borrowers have good and marketable title to
all their real and personal properties, subject to no transfer restrictions or
Liens of any kind, except for (a) the transfer restrictions and Liens described
in Schedule 7.7 attached hereto and incorporated herein by reference, and (b)
Liens permitted under Section 9.7 hereof. Keystone has fee simple title to its
manufacturing facility located in Bath, Pennsylvania; Giant Cement has fee
simple title to its manufacturing facility located in Harleyville, South
Carolina; and no Borrower leases any facility except as so indicated on Schedule
2 to the Security Agreement.
7.8 Taxes. The Borrowers have filed or caused to be filed or obtained
extensions of the time to file all federal, state and local tax returns which
are required to be filed by it and, except for taxes and assessments being
contested in good faith and against which reserves have been established which
are satisfactory to the Borrowers' independent certified public accountants as
determined in the normal course of their annual audit of the Borrowers and
evidenced by their most recent opinion delivered pursuant to and satisfying the
standards in Section 8.1(a) hereof, have paid or caused to be paid all taxes as
shown on said returns or on any assessment received by it, to the extent that
such taxes have become due.
7.9 Other Agreements. None of the Borrowers is
(a) a party to any judgment, order, decree or any agreement or
instrument or subject to restrictions which could reasonably be likely to
have a Material Adverse Effect; or
(b) in default in the performance, observance or fulfillment of any of
the obligations, covenants or conditions contained in any agreement or
instrument to which any Borrower is a party, which default has, or if not
remedied within any applicable grace period could reasonably be likely to
have, a Material Adverse Effect.
7.10 Litigation. There is no action, suit or proceeding at law or in equity
or by or before any governmental instrumentality or agency or arbitral body
pending, or, to the knowledge of the Borrowers, threatened by or against any
Borrower or affecting any Borrower or any properties or rights of any Borrower,
which could reasonably be likely to have a Material Adverse Effect.
7.11 Margin Stock. None of the Borrowers owns any "margin stock" as such
term is defined in Regulation U, as amended (12 C.F.R. Part 221), of the Board.
The proceeds of the borrowings made pursuant to Articles II and III hereof will
be used by the Borrowers only for the purposes set forth in Sections 2.10 and
3.5 hereof. None of such proceeds will be used, directly or indirectly, for the
purpose of purchasing or carrying any margin stock or for the purpose of
reducing or retiring any Indebtedness which was originally incurred to purchase
or carry margin stock or for any other purpose which might constitute any of the
Loans under this Agreement a "purpose credit" within the meaning of said
Regulation U or Regulation X (12 C.F.R. Part 224) of the Board. Neither the
Borrowers nor any agent acting in their behalf has taken or will take any action
which might cause this Agreement or any of the documents or instruments
delivered pursuant hereto to violate any regulation of the Board or to violate
the Securities Exchange Act of 1934, as amended, or the Securities Act of 1933,
as amended, or any state securities laws, in each case as in effect on the date
hereof.
7.12 Investment Company. None of the Borrowers is an "investment company,"
or an "affiliated person" of, or "promoter" or "principal underwriter" for, an
"investment company," as such terms are defined in the Investment Company Act of
1940, as amended (15 U.S.C. $ 80a-1, et seq.). The application of the proceeds
of the Loans and repayment thereof by the Borrowers and the performance by the
Borrowers of the transactions contemplated by this Agreement will not violate
any provision of said Act, or any rule, regulation or order issued by the
Securities and Exchange Commission thereunder, in each case as in effect on the
date hereof.
7.13 Patents, Etc. Each of the Borrowers owns or has the right to use,
under valid license agreements or otherwise, all material patents, licenses,
franchises, trademarks, trademark rights, trade names, trade name rights, trade
secrets and copyrights necessary to the conduct of its businesses as now
conducted, without known conflict with any patent, license, franchise,
trademark, trade secrets and confidential commercial or proprietary information,
trade name, copyright, rights to trade secrets or other proprietary rights of
any other Person.
7.14 No Untrue Statement. Neither this Agreement nor any other Loan
Document or certificate or document executed and delivered by or on behalf of
the Borrowers in accordance with or pursuant to any Loan Document contains any
misrepresentation or untrue statement of material fact or omits to state a
material fact necessary, in light of the circumstance under which it was made,
in order to make any such representation or statement contained therein not
misleading.
7.15 No Consents, Etc. Neither the respective businesses or properties of
any Borrower, nor any relationship between any Borrower and any other Person,
nor any circumstance in connection with the execution, delivery and performance
of the Loan Documents and the transactions contemplated hereby, is such as to
require a consent, approval or authorization of, or filing, registration or
qualification with, any governmental or other authority or any other Person on
the part of any Borrower as a condition to the execution, delivery and
performance of, or consummation of the transactions contemplated by, this
Agreement or the other Loan Documents which, if not obtained or effected, could
reasonably be likely to have a Material Adverse Effect or if so, such consent,
approval, authorization, filing, registration or qualification has been obtained
or effected, as the case may be.
7.16 Employee Benefit Plans.
(a) Neither any Borrower nor any ERISA Affiliate maintains or
contributes to, or has any obligation under, any Employee Benefit Plans
other than those identified on Schedule 7.16 attached hereto;
(b) Each Borrower and each ERISA Affiliate is in compliance with all
applicable provisions of ERISA and the regulations and published
interpretations thereunder and in compliance with all Foreign Benefit Laws
with respect to all Employee Benefit Plans except where failure to comply
would not result in a Material Adverse Effect and except for any required
amendments for which the remedial amendment period as defined in Section
401(b) of the Code has not yet expired. Each Employee Benefit Plan that is
intended to be qualified under Section 401(a) of the Code has been
determined by the Internal Revenue Service to be so qualified, and each
trust related to such plan has been determined to be exempt under Section
501(a) of the Code. No material liability has been incurred by the
Borrowers or any ERISA Affiliate which remains unsatisfied for any taxes or
penalties with respect to any Employee Benefit Plan or any Multiemployer
Plan;
(c) No Pension Plan has been terminated within the six year period
prior to the execution of this Agreement, nor has any accumulated funding
deficiency (as defined in Section 412 of the Code) been incurred (without
regard to any waiver granted under Section 412 of the Code), nor has any
funding waiver from the IRS been received or requested with respect to any
Pension Plan, nor have the Borrowers or any ERISA Affiliate failed to make
any contributions or to pay any amounts due and owing as required by
Section 412 of the Code, Section 302 of ERISA or the terms of any Pension
Plan prior to the due dates of such contributions under Section 412 of the
Code or Section 302 of ERISA, nor has there been any event requiring any
disclosure under Section 4041(c)(3)(C), 4063(a) or 4068(f) of ERISA with
respect to any Pension Plan;
(d) Neither any Borrower nor any ERISA Affiliate has: (i) engaged in a
nonexempt prohibited transaction described in Section 406 of ERISA or
Section 4975 of the Code, (ii) incurred any liability to the PBGC which
remains outstanding other than the payment of premiums and there are no
premium payments which are due and unpaid, (iii) failed to make a required
contribution or payment to a Multiemployer Plan or (iv) failed to make a
required installment or other required payment under Section 412 of the
Code;
(e) No Termination Event has occurred or is reasonably expected to
occur with respect to any Pension Plan or Multiemployer Plan;
(f) No material proceeding, claim, lawsuit and/or investigation exists
or, to the best knowledge of each Borrower after due inquiry, is threatened
concerning or involving any Employee Benefit Plan.
7.17 No Default. As of the date hereof, there does not exist any Default or
Event of Default hereunder.
7.18 Hazardous Materials. Each Borrower is in compliance with all
applicable Environmental Laws in all material respects, including without
limitation its operations and properties in South Carolina and Pennsylvania. No
Borrower has been notified of any action, suit, proceeding or investigation
which calls into question compliance by such Borrower with any Environmental
Laws that could reasonably be expected to have a Material Adverse Effect, or
which seeks to suspend, revoke or terminate any license, permit or approval
necessary for the generation, handling, storage, treatment or disposal of any
Hazardous Material that could reasonably be expected to have a Material Adverse
Effect. Except as disclosed in the permits set forth on Schedule 7.18, each real
property occupied, leased or operated by any Borrower is free from all Hazardous
Material that could reasonably be expected to have a Material Adverse Effect.
7.19 RICO. None of the Borrowers is engaged in or have not engaged in any
course of conduct that could subject any of their respective properties to any
Lien, seizure or other forfeiture under any criminal law, racketeer influenced
and corrupt organizations law, civil or criminal, or other similar laws.
7.20 Employment Matters.
(a) None of any employees of any Borrower is subject to any collective
bargaining agreement and, except as disclosed on Schedule 7.20, there are
no strikes, work stoppages, election or decertification petitions or
proceedings, unfair labor charges, equal opportunity proceedings, or other
material labor/employee related controversies or proceedings pending or, to
the best knowledge of each Borrower, threatened against any Borrower or
between any Borrower and any of its employees, other than employee
grievances arising in the ordinary course of business which would not in
the aggregate have a Material Adverse Effect.
(b) Each Borrower is in compliance in all material respects with all
applicable laws, rules and regulations pertaining to labor or employment
matters, including without limitation those pertaining to wages, hours,
occupational safety and taxation and there is neither pending or threatened
any material litigation, administrative proceeding nor, to the knowledge of
each Borrower, any investigation, in respect of such matters which, if
decided adversely, could reasonably be likely to have a Material Adverse
Effect.
ARTICLE VIII
Affirmative Covenants
Until the Obligations have been paid and satisfied in full and this
Agreement has been terminated in accordance with the terms hereof, unless the
Required Lenders shall otherwise consent in writing, each of the Borrowers will:
8.1 Financial Reports, Etc.
(a) As soon as practical and in any event within 90 days after the end
of each Fiscal Year, deliver or cause to be delivered to the Agent and each
Lender (i) consolidated and consolidating balance sheets of the Borrowers,
and the notes thereto, the related statements of operations, stockholders'
equity and cash flows, and the respective notes thereto, for such Fiscal
Year, setting forth in the case of the statements comparative financial
statements for the preceding Fiscal Year, all prepared in accordance with
GAAP applied on a Consistent Basis and containing, with respect to the
consolidated financial reports, opinions of Coopers & Xxxxxxx, or other
such independent certified public accountants selected by Giant Holding and
approved by the Agent, which are unqualified as to the scope of the audit
performed and as to the "going concern" status of the Borrowers and are
without exception not acceptable to the Required Lenders, and (ii) a
certificate of an Authorized Representative demonstrating compliance with
Sections 9.1, 9.2, 9.3, 9.4 and 9.5 hereof, which certificate shall be in
the form attached hereto as Exhibit I hereof;
(b) as soon as practical and in any event within 45 days after the end
of each quarterly period (except the last reporting period of the Fiscal
Year), deliver to the Agent and each Lender (i) consolidated balance sheets
of the Borrowers as of the end of such reporting period, the related
statements of operations, stockholders' equity and cash flows for such
reporting period and for the period from the beginning of the Fiscal Year
through the end of such reporting period, accompanied by a certificate of
an Authorized Representative to the effect that such financial statements
present fairly the financial position of the Borrowers as of the end of
such reporting period and the results of their operations and the changes
in their financial position for such reporting period, in conformity with
the standards set forth in Section 7.6(a)(ii) hereof with respect to
interim financials, and (ii) a certificate of an Authorized Representative
containing computations for such quarter comparable to that required
pursuant to Section 8.1(a)(ii) hereof;
(c) together with each delivery of the financial statements required
by Section 8.1(a)(i) hereof, deliver to the Agent and each Lender a letter
from the Borrowers' accountants specified or otherwise determined as set
forth in Section 8.1(a)(i) hereof stating that in performing the audit
necessary to render an opinion on the financial statements delivered under
Section 8.1(a)(i) hereof, they obtained no knowledge of any Default or
Event of Default by the Borrowers in the fulfillment of the terms and
provisions of this Agreement insofar as they relate to financial matters
(which at the date of such statement remains uncured); and if the
accountants have obtained knowledge of such Default or Event of Default, a
statement specifying the nature and period of existence thereof;
(d) promptly upon their becoming available to the Borrowers, the
Borrowers shall deliver to the Agent and each Lender a copy of (i) all
regular or special reports or effective registration statements which any
of the Borrowers shall file with the Securities and Exchange Commission (or
any successor thereto) or any securities exchange, including without
limitation each Annual Report on Form 10-K, each Quarterly Report on Form
10-Q and each Current Report on Form 8-K, (ii) any proxy statement
distributed by any of the Borrowers to their shareholders, bondholders or
the financial community in general, and (iii) any management letter or
other report submitted to the Board of Directors of Giant Holding by
independent accountants in connection with any annual, interim or special
audit of the Borrowers;
(e) promptly, from time to time, deliver or cause to be delivered to
the Agent and each Lender such other information regarding Borrowers'
operations, business affairs and financial condition as the Agent or such
Lender may reasonably request. The Agent and the Lenders are hereby
authorized to deliver a copy of any such financial information delivered
hereunder to the Lenders (or any affiliate of any Lender) or to the Agent,
to any regulatory authority having jurisdiction over any of the Lenders
pursuant to any written request therefor, or to any other Person who shall
acquire or consider the assignment of or Participation in any Loan or
Letter of Credit permitted by this Agreement.
8.2 Maintain Properties. Maintain all properties necessary to its
operations in good working order and condition, ordinary wear and tear excepted,
and make all needed repairs, replacements and renewals as are reasonably
necessary to conduct its business in accordance with customary business
practices.
8.3 Existence, Qualification, Etc. Do or cause to be done all things
necessary to preserve and keep in full force and effect its existence and all
material rights and franchises, trade names, trademarks and permits and maintain
its license or qualification to do business as a foreign corporation and good
standing in each jurisdiction in which its ownership or lease of property or the
nature of its business makes such license or qualification necessary except
where the failure to so qualify could not reasonably be expected to have a
Material Adverse Effect.
8.4 Regulations and Taxes. Comply in all material respects with or contest
in good faith all statutes and governmental regulations and pay all taxes,
assessments, governmental charges, claims for labor, supplies, rent and any
other obligation which, if unpaid, would become a Lien against any of its
properties except liabilities being contested in good faith by appropriate
proceedings diligently conducted and against which adequate reserves have been
established which are satisfactory to the independent public accountants of the
Borrowers as determined in the normal course of their annual audit of the
Borrowers and evidenced by their most recent opinion delivered pursuant to and
satisfying the standards in Section 8.1(a) hereof.
8.5 Insurance. Keep all of its insurable properties adequately insured at
all times and maintain general public liability insurance at all times with
responsible insurance carriers against loss or damage by fire and other hazards
as are customarily insured against by similar businesses owning such properties
similarly situated. Maintain insurance under all applicable workers'
compensation laws. Each of the casualty policies insuring Collateral shall
provide that the insurer shall give the Agent not less than thirty (30) days'
prior written notice before any such policy shall be terminated, lapse or be
altered in any manner and shall name the Agent as an additional insured or
secured party, as applicable.
8.6 True Books. Maintain proper books of record and account in which full,
true and correct entries will be made of all of its dealings and transactions as
may be required by GAAP, and set up on its books such reserves as may be
required by GAAP with respect to doubtful accounts and all taxes, assessments,
charges, levies and claims and with respect to its business in general, and
include such reserves in all material respects in interim as well as year-end
financial statements.
8.7 Pay Indebtedness to Lenders and Perform Other Covenants. (a) Make full
and timely payment of the principal of and interest on the Notes and all other
Obligations whether now existing or hereafter arising; and (b) duly comply with
and perform all the terms and covenants contained in all Loan Documents.
8.8 Payment of Other Indebtedness. Pay when due (or within applicable grace
periods) all Indebtedness due third Persons, except when the amount thereof is
being contested in good faith by appropriate proceedings diligently conducted
and with reserves in form and amount reasonably acceptable to the Agent therefor
being set aside on the books of the Borrowers.
8.9 Right of Inspection. Permit any representative designated by any Lender
or the Agent to visit and inspect any of the properties, corporate books and
financial reports of the Borrowers and to discuss its affairs, finances and
accounts with its principal officers and independent certified public
accountants, all at reasonable times, at reasonable intervals and with
reasonable prior notice.
8.10 Observe all Laws. Conform to and duly observe in all material respects
all laws, rules and regulations and all other valid requirements of any
regulatory authority with respect to the conduct of its business.
8.11 Officer's Knowledge of Default. Upon any senior officer of any
Borrower obtaining knowledge of any Default or Event of Default hereunder or
under any other obligation of the Borrowers to any Lender, cause such officer or
an Authorized Representative promptly to notify the Agent of the nature thereof,
the period of existence thereof, and what action the Borrowers propose to take
with respect thereto.
8.12 Suits or Other Proceedings. Upon any senior officer of any Borrower
obtaining knowledge of any litigation or other proceedings being instituted
against any of the Borrowers, or any attachment, levy, execution or other
process being instituted against any assets of any of the Borrowers, making a
claim or claims in an aggregate amount greater than, or reasonably expected to
be greater than, $1,000,000 not reasonably expected to be covered by insurance,
promptly deliver to the Agent written notice thereof stating the nature and
status of such litigation, dispute, proceeding, levy, execution or other
process.
8.13 Environmental Compliance. If any of the Borrowers shall receive notice
from any Governmental Authority that any of the Borrowers have violated any
applicable Environmental Laws which could reasonably be likely to have a
Material Adverse Effect, promptly deliver a copy of such notice to the Agent and
use its best efforts to remove or remedy such violation within the time period
prescribed in such notice or, if none, within a reasonable time.
8.14 Indemnification. Each of the Borrowers hereby jointly and severally
agrees to defend, indemnify and hold the Agent and the Lenders harmless from and
against any and all claims, losses, liabilities, damages and expenses
(including, without limitation, cleanup costs and reasonable attorneys' fees)
arising directly or indirectly from, out of or by reason of the handling,
storage, treatment, emission or disposal of any Hazardous Material by any of the
Borrowers or property owned or leased or operated by any of the Borrowers. The
provisions of this Section 8.14 shall survive repayment of the Obligations,
occurrence of the Revolving Credit Termination Date and expiration or
termination of this Agreement for so long as any applicable statute of
limitations period.
8.15 Further Assurances. At the Borrowers' cost and expense, upon request
of the Agent or any Lender, duly execute and deliver or cause to be duly
executed and delivered, to the Agent for the benefit of the Lenders such further
instruments, documents, certificates, financing and continuation statements, and
do and cause to be done such further acts that may be reasonably necessary or
advisable in the reasonable opinion of the Agent to carry out more effectively
the provisions and purposes of this Agreement and the other Loan Documents.
8.16 Employee Benefit Plans. With reasonable promptness, and in any event
within thirty (30) days thereof, give notice of and/or deliver to Agent copies
of (a) the establishment of any new Employee Benefit Plan, (b) the commencement
of contributions to any plan to which any of the Borrowers or any of their ERISA
Affiliates were not previously contributing, (c) any material increase in the
benefits of any existing Employee Benefit Plan, (d) each funding waiver request
filed with respect to any Employee Benefit Plan and all communications received
or sent by any of the Borrowers or any ERISA Affiliate with respect to such
request and (e) the failure of any of the Borrowers or any ERISA Affiliate to
make a required installment or payment under Section 302 of ERISA or Section 412
of the Code by the due date.
8.17 Termination Events. Promptly and in any event within fifteen (15) days
of becoming aware of the occurrence of or forthcoming occurrence of any (a)
Termination Event or (b) "prohibited transaction," as such term is defined in
Section 406 of ERISA or Section 4975 of the Code, in connection with any Pension
Plan or any trust created thereunder, deliver to the Agent a notice specifying
the nature thereof, what action the Borrowers have taken, are taking or propose
to take with respect thereto and, when known, any action taken or threatened by
the Internal Revenue Service, the Department of Labor or the PBGC with respect
thereto.
8.18 ERISA Notices. With reasonable promptness but in any event within
fifteen (15) days for purposes of clauses (a), (b) and (c), deliver to the Agent
copies of (a) any unfavorable determination letter from the Internal Revenue
Service regarding the qualification of an Employee Benefit Plan under Section
401(a) of the Code, (b) all notices received by the Borrowers or any ERISA
Affiliate of the PBGC's intent to terminate any Pension Plan or to have a
trustee appointed to administer any Pension Plan, (c) each Schedule B (Actuarial
Information) to the annual report (Form 5500 Series) filed by the Borrowers or
any ERISA Affiliate with the Internal Revenue Service with respect to each
Pension Plan and (d) all notices received by any of the Borrowers or any ERISA
Affiliate from a Multiemployer Plan sponsor concerning the imposition or amount
of withdrawal liability pursuant to Section 4202 of ERISA. The Borrowers will
notify the Agent in writing within five (5) Business Days of any Borrower
obtaining knowledge or reason to know that any Borrower or any ERISA Affiliate
has filed or intends to file a notice of intent to terminate any Pension Plan
under a distress termination within the meaning of Section 4041(c) of ERISA.
8.19 Continued Operations. Continue at all times to conduct its business
and engage principally in the same line or lines of business substantially as
heretofore conducted and to preserve, protect and maintain free from Liens,
other than Liens permitted under Section 9.6 hereof, its material patents,
copyrights, licenses, trademarks, trademark rights, trade names, trade name
rights, trade secrets and know-how necessary or useful in the conduct of its
operations.
8.20 Use of Proceeds. Use the proceeds of the Loans solely for the purposes
specified in Sections 2.10 and 3.5 hereof.
8.21 New Subsidiaries. Simultaneously with the acquisition or creation of
any Subsidiary, or upon any previously existing Persons becoming a Subsidiary,
cause to be delivered to the Agent for the benefit of the Lenders each of the
following:
(i) an amendment to this Agreement executed by such Subsidiary
whereby such Subsidiary becomes a Borrower in form and substance
acceptable to the Agent;
(ii) an amendment to the Security Instruments executed by such
Subsidiary whereby such Subsidiary grants to the Agent for the benefit
of the Lenders a Lien on all its Collateral and such related Uniform
Commercial Code financing statements and other instruments as required
by the Agent;
(iii) an amendment to the Subordination Agreement executed by
such Subsidiary whereby such Subsidiary becomes a party thereto and
agrees to subordinate its debt or obligations to any Borrower to the
Obligations contemplated under any of the Loan Documents;
(iv) an opinion of counsel to such Subsidiary dated as of the
date of delivery of the amendments provided in the foregoing clauses
(i) and (ii) and addressed to the Agent and the Lenders, in form and
substance reasonably acceptable to the Agent and substantially similar
to the opinions of counsel to the Borrowers delivered on the Closing
Date to the Lenders pursuant to Section 6.1 hereof; and
(v) current copies of the charter or other organizational
documents and bylaws of such Subsidiary, minutes of duly called and
conducted meetings (or duly effected consent actions) of the Board of
Directors, or appropriate committees thereof (and, if required by such
charter or other organizational documents, bylaws or by applicable
laws, of the shareholders) of such Subsidiary authorizing the actions
and the execution and delivery of documents described in clauses (i)
and (ii) of this Section 8.21 and evidence satisfactory to the Agent
(confirmation of the receipt of which will be provided by the Agent to
the Lenders) that such Subsidiary is Solvent as of such date and after
giving effect to the amendments to this Agreement and the Security
Agreement.
ARTICLE IX
Negative Covenants
Until the Obligations have been paid and satisfied in full and this
Agreement has been terminated in accordance with the terms hereof, unless the
Required Lenders shall otherwise consent in writing, none of the Borrowers will:
9.1 Consolidated Indebtedness for Money Borrowed to Consolidated Tangible
Net Worth Ratio. Permit the ratio of Consolidated Indebtedness for Money
Borrowed to Consolidated Tangible Net Worth to be greater than 1.50 to 1.00 at
any time.
9.2 Consolidated Fixed Charge Ratio. Permit as of the last day of any
calendar quarter the Consolidated Fixed Charge Ratio to be less than 1.50 to
1.00.
9.3 Current Ratio. Permit as of the last day of any calendar quarter the
ratio of Consolidated Current Assets to Consolidated Current Liabilities to be
less than 1.25 to 1.00.
9.4 Capital Expenditures. Permit the aggregate amount of all Capital
Expenditures of the Borrowers during any Fiscal Year to exceed twice the amount
of all Depreciation for such Fiscal Year; provided that to the extent not
expended in any Fiscal Year ("Excess Capital Expenditures"), such Excess Capital
Expenditures may not be carried over and expended in any following Fiscal Year.
9.5. Consolidated Tangible Net Worth. Permit Consolidated Tangible Net
Worth to be less than, (i) commencing on the date of delivery of a consolidated
balance sheet of Giant Holding and its Subsidiaries dated as of the effective
date of the Solite Transaction and giving effect to the Solite Transaction (the
"Closing Balance Sheet"), which must be delivered not later than 90 days after
closing of the Solite Transaction, (x) the Consolidated Tangible Net Worth as
calculated on the Closing Balance Sheet minus (y) $7,500,000; and (ii)
commencing December 31, 1998 and at all times thereafter, adjusted as of the
last day of each Fiscal Year (each such date, including December 31, 1998,
referred to as the "Adjustment Date"), the sum of (A) the amount of Consolidated
Tangible Net Worth required to be maintained pursuant to this Section 9.5 during
the Fiscal Year of the Borrowers ending on such Adjustment Date, plus (B) 50% of
Consolidated Net Income for the Fiscal Year ending on such Adjustment Date
(including within "Consolidated Net Income" all items otherwise excluded, as
provided for in the definition of "Consolidated Net Income"), plus (C) 100% of
the aggregate Net Proceeds of all equity issuances consummated during the Fiscal
Year ending on such Adjustment Date.
9.6 Liens. Incur, create or permit to exist any pledge, Lien, charge or
other encumbrance of any nature whatsoever with respect to any real or personal
property now owned or hereafter acquired by any Borrower, other than
(a) Liens existing as of the date hereof and as set forth in Schedule
7.7 attached hereto;
(b) any Lien created under the Loan Documents;
(c) Liens imposed by law for taxes, assessments or charges of any
Governmental Authority for claims not yet due or which are being contested
in good faith by appropriate proceedings diligently conducted and with
respect to which adequate reserves or other appropriate provisions are
being maintained in accordance with GAAP;
(d) statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, materialmen, repairmen and other Liens imposed by law or created
in the ordinary course of business and in existence less than 90 days from
the date of creation thereof for amounts not yet due or which are being
contested in good faith by appropriate proceedings diligently conducted and
with respect to which adequate reserves or other appropriate provisions are
being maintained in accordance with GAAP;
(e) Liens incurred or deposits made in the ordinary course of business
(including, without limitation, surety bonds and appeal bonds) in
connection with workers' compensation, unemployment insurance and other
types of social security benefits or to secure the performance of tenders,
bids, leases, contracts (other than for the repayment of Indebtedness),
statutory obligations and other similar obligations or arising as a result
of progress payments under government contracts;
(f) purchase money Liens to secure Indebtedness incurred to purchase
fixed assets or Equipment, provided the Indebtedness represents not less
than 75% nor more than 100% of the purchase price of such assets as of the
date of purchase thereof and no property other than the assets so purchased
secures such Indebtedness;
(g) Liens to secure Indebtedness permitted under Section 9.7(d)
hereof, provided such Liens attach only to assets of such newly acquired
Borrower and do not attach to the assets of any other Borrower;
(h) any Lien existing on any property or asset prior to the
acquisition thereof by any Borrower;
(i) zoning restrictions, easements, rights-of-way, restrictions on use
of real property and other similar encumbrances incurred in the ordinary
course of business that, in the aggregate, are not substantial in amount
and do not materially detract from the value of the property subject
thereto or interfere with the ordinary conduct of the business of any
Borrower; and
(j) any Lien represented by the interest of a lessor in property the
subject of a capital lease permitted by this Agreement.
9.7 Consolidated Indebtedness. Incur, create, assume or permit to exist any
Consolidated Indebtedness, howsoever evidenced, except:
(a) Consolidated Indebtedness existing as of the date hereof and as
set forth in Schedule 7.6 attached hereto and incorporated herein by
reference and any extension, renewal or refinancing thereof that does not
increase the principal amount thereof or interest rate payable thereon from
that existing immediately prior to such extension, renewal or refinancing;
provided, none of the instruments and agreements evidencing or governing
such Indebtedness shall be amended, modified or supplemented after the
Closing Date to change any terms of subordination, repayment or rights of
conversion, put, exchange or other rights from such terms and rights as in
effect on the Closing Date;
(b) Consolidated Indebtedness owing to the Agent or any Lender in
connection with this Agreement, any Note or other Loan Document;
(c) the endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of business;
(d) Consolidated Indebtedness of Solite Corporation and its
Subsidiaries with respect to capitalized leases acquired in connection with
the Solite Transaction;
(e) Consolidated Indebtedness of Borrowers acquired after the Closing
Date, provided that (i) such Consolidated Indebtedness (A) is recorded in
the financial books and records of such Borrower prior to such acquisition,
(B) was not incurred by such Borrower in anticipation of such acquisition,
and (C) is incurred upon terms determined by Giant Holding in its good
faith business judgment to be more economically advantageous to the
Borrowers than the terms of an Advance hereunder, (ii) immediately after
such acquisition and the incurrence of such Consolidated Indebtedness, no
Default or Event of Default has occurred or is continuing and (iii) the
aggregate principal amount of such Consolidated Indebtedness does not
exceed $7,500,000;
(f) (i) purchase money Consolidated Indebtedness and (ii) Consolidated
Indebtedness incurred with respect to financing of Capital Expenditures,
collectively under both clause (i) and (ii) not to exceed an aggregate
outstanding amount at any time of $10,000,000;
(g) other Consolidated Indebtedness not otherwise covered by clauses
(a) through (e) above, provided that the aggregate outstanding principal
amount of all such other Consolidated Indebtedness permitted under this
clause (f) shall in no event exceed $3,000,000 at any time.
9.8 Transfer of Assets. Sell, lease, transfer or otherwise dispose of any
assets of any of the Borrowers other than (a) dispositions of Inventory in the
ordinary course of business; (b) dispositions of equipment that is substantially
worn, damaged, obsolete or, in the judgment of the Borrowers, no longer best
used or useful in its business which, in the aggregate during any fiscal year,
has a fair market value or book value, whichever is less, of $500,000 or less
and is not replaced by equipment having at least equivalent value; (c)
dispositions of equipment provided that (i) such equipment is replaced by
equipment of like kind or function and equal or greater value, (ii) the
replacement equipment shall be acquired prior to or substantially
contemporaneously with any disposition of the equipment that is to be replaced,
and (iii) the replacement equipment shall be free and clear of Liens other than
the Liens permitted by Section 9.6(e) hereof and, if such disposed equipment was
Equipment, such replacement Equipment shall be subject to the security interests
granted to the Agent for the benefit of the Lenders by Keystone pursuant to the
Security Agreement; and (d) other dispositions of assets not exceeding $250,000
in aggregate sales price in any Fiscal Year.
9.9 Investments; Acquisitions. Make any acquisition or otherwise purchase,
own, invest in or otherwise acquire, directly or indirectly, any stock or other
securities, or make or permit to exist any interest whatsoever in any other
Person or permit to exist any loans or advances to any Person, except that
Borrowers may maintain investments or invest in:
(a) Eligible Securities;
(b) investments existing as of the date hereof and as set forth in
Schedule 9.9 attached hereto;
(c) accounts receivable arising and trade credit granted in the
ordinary course of business and any securities received in satisfaction or
partial satisfaction thereof in connection with accounts of financially
troubled Persons to the extent reasonably necessary in order to prevent or
limit loss;
(d) investments in, and loans and other extensions of credit to,
another Borrower provided, however, each loan or extension of credit is
subordinated to the Obligations on terms satisfactory to the Lenders;
(e) loans to employees in the ordinary course of business in an
aggregate principal amount outstanding at any time of $500,000; and
(f) other loans, advances and investments in an aggregate principal
amount at any time outstanding not to exceed $500,000.
Notwithstanding the foregoing, the Borrowers may make Acquisitions so long
as: (i) immediately prior to and immediately after the consummation of such
Acquisition, no Default or Event of Default has occurred and is continuing, (ii)
substantially all of the sales and operating profits generated by such Person
(or assets) so acquired or invested are derived from the same line or lines of
business as then conducted by the Borrowers, (iii) pro forma historical
financial statements as of the end of the most recently completed Fiscal Year
giving effect to such Acquisition are delivered to the Agent not less than five
(5) Business Days prior to the consummation of such Acquisition, together with a
certificate of an Authorized Representative demonstrating compliance with
Sections 9.1, 9.2, 9.3, 9.4 and 9.5 hereof on a pro forma basis after giving
effect to such Acquisition, (iv) the aggregate amount of all Costs of
Acquisition shall not exceed $10,000,000 during any Fiscal Year, and (v) in the
event the Person so acquired is not a Subsidiary, the Borrowers' strategic plan
includes additional investment in such Person sufficient for it to become a
Subsidiary. All expenditures for or acquisitions of fixed or capital assets not
constituting an Acquisition within the meaning of this Agreement shall be deemed
to be Capital Expenditures and therefore subject to the provisions of Section
9.7 hereof.
9.10 Merger or Consolidation. (a) Consolidate with or merge into any other
Person, or (b) liquidate, wind-up or dissolve; provided that any Borrower may
merge into another Borrower and any Borrower may effect by merger any
acquisition complying with Section 9.9 hereof.
9.11 Change in Control.
(a) Cause, suffer or permit (i) any "person" or "group" (as such terms
are used in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, as amended), to own or control, directly or indirectly, more than 40%
of the outstanding securities of Giant Holding having voting rights in the
election of directors, in each case to be determined on a fully diluted
basis and taking into account any outstanding securities or contract rights
exercisable, exchangeable or convertible into equity interests or (ii)
individuals who at the Closing Date constituted the Board of Directors of
Giant Holding (together with any new directors whose election by the Board
of Directors or whose nomination for election by the stockholders of Giant
Holding was approved by a vote of a majority of the directors of Giant
Holding then still in office who were either directors of Giant Holding at
the Closing Date or whose election or nomination for election was
previously so approved) to cease for any reason to constitute at least
two-thirds (2/3) of the Board of Directors of Giant Holding then in office.
(b) Cause, suffer or permit any Person or group of Persons other than
any Borrower as of the Closing Date to own or control, directly or
indirectly, any capital stock of any Borrower other than Giant Holding
having voting rights in the election of directors, or any other equity
security or a security convertible into or exchangeable or redeemable for
any equity security, other than the ownership or control of all the issued
and outstanding capital stock of any Borrower in the event the provisions
of Section 9.8 hereof would not be violated if all assets of such Borrower
were sold, leased, transferred or otherwise disposed.
9.12 Transactions with Affiliates. Enter into any transaction, including,
without limitation, the purchase, sale, leasing or exchange of property, real or
personal, or the rendering of any service, with any Affiliate (other than
another Borrower) of any Borrower, except (a) that an Affiliate may render
services to such Borrower for compensation at the same rates generally paid by
Persons engaged in the same or similar businesses for the same or similar
services and (b) in the ordinary course of and pursuant to the reasonable
requirements of such Borrower's business consistent with past practice of such
Borrower, other than any transactions with Affiliates of any Borrower which in
the aggregate do not exceed $500,000.
9.13 Compliance with ERISA. With respect to any Pension Plan, Employee
Benefit Plan or Multiemployer Plan:
(a) permit the occurrence of any Termination Event which would result
in a liability to the Borrowers or any ERISA Affiliate in excess of
$1,000,000;
(b) permit the present value of all benefit liabilities under all
Pension Plans to exceed the current value of the assets of such Pension
Plans allocable to such benefit liabilities by more than $15,000,000 and in
any Fiscal Year make contributions in an amount less than is required by
actuarial calculations;
(c) permit any accumulated funding deficiency in excess of $250,000
(as defined in Section 302 of ERISA and Section 412 of the Code) with
respect to any Pension Plan, whether or not waived;
(d) fail to make any contribution or payment to any Multiemployer Plan
which the Borrowers or any ERISA Affiliate may be required to make under
any agreement relating to such Multiemployer Plan, or any law pertaining
thereto which results in or is likely to result in a liability in excess of
$250,000; or
(e) engage, or permit any Borrower or any ERISA Affiliate to engage,
in any prohibited transaction under Section 406 of ERISA or Sections 4975
of the Code for which a civil penalty pursuant to Section 502(i) of ERISA
or a tax pursuant to Section 4975 of the Code in excess of $250,000 may be
imposed; or
(f) permit the establishment of any Employee Benefit Plan providing
post-retirement welfare benefits or establish or amend any Employee Benefit
Plan which establishment or amendment could result in liability to the
Borrowers or any ERISA Affiliate or increase the obligation of the
Borrowers or any ERISA Affiliate to a Multiemployer Plan which liability or
increase, individually or together with all similar liabilities and
increases, is in excess of $1,000,000; or
(g) fail, or permit the Borrowers or any ERISA Affiliate to fail, to
establish, maintain and operate each Employee Benefit Plan in compliance
with the provisions of ERISA, the Code, all applicable Foreign Benefit Laws
and all other applicable laws and the regulations and official published
interpretations thereof in the event such noncompliance could reasonably be
expected to result in a Material Adverse Effect.
9.14 Fiscal Year. Change its Fiscal Year.
9.15 Limitations on Sales and Leasebacks. Enter into any arrangement with
any Person providing for the leasing by any Borrower of real or personal
property which has been or is to be sold or transferred by any Borrower to such
Person or to any other Person to whom funds have been or are to be advanced by
such Person on the security of such property or rental obligations of the
Borrowers.
9.16 Negative Pledge Clauses. Enter into any agreement with any Person
other than the Agent and the Lenders pursuant to this Agreement and the other
Loan Documents which prohibits or limits the ability of any of the Borrowers to
create, incur, assume or suffer to exist any Lien, upon any of its property,
assets or revenues, whether now owned or hereafter acquired.
ARTICLE X
Events of Default and Acceleration
10.1 Events of Default. If any one or more of the following events (herein
called "Events of Default") shall occur for any reason whatsoever (and whether
such occurrence shall be voluntary or involuntary or come about or be effected
by operation of law or pursuant to or in compliance with any judgment, decree or
order of any court or any order, rule or regulation of any administrative or
governmental body), that is to say:
(a) if default shall be made in the due and punctual payment of the
principal of any Loan, Reimbursement Obligation or Obligation, when and as
the same shall be due and payable whether pursuant to any provision of
Article II, III, IV or V hereof, at maturity, by acceleration or otherwise;
or
(b) if default shall be made in the due and punctual payment of any
amount of interest on any Loan or of any fees or other amounts payable to
any of the Lenders or the Agent under the Loan Documents on the date on
which the same shall be due and payable and such default shall continue
unremedied for more than two (2) Business Days; or
(c) if default shall be made in the performance or observance of any
covenant set forth in Sections 8.7(a), 8.9, 8.11, 8.12, 8.19, 8.20 or
Article IX hereof;
(d) if a default shall be made in the performance or observance of, or
shall occur under, any covenant, agreement or provision contained in this
Agreement or the Notes (other than as described in clauses (a), (b) or (c)
above) or any other agreement between any of the Borrowers and any Lender
creating or relating to any Consolidated Indebtedness owing by any of the
Borrowers to any Lender and such default shall continue for 30 or more days
after the earlier of receipt of notice of such default by the Authorized
Representative from the Agent or a senior officer of any of the Borrowers
becomes aware of such default, or if a default shall be made in the
performance or observance of, or shall occur under, any covenant, agreement
or provision contained in any of the other Loan Documents (beyond any
applicable grace period, if any, contained therein) or in any instrument or
document evidencing or creating any obligation, guaranty, or Lien in favor
of the Agent or any of the Lenders or delivered to the Agent or any of the
Lenders in connection with or pursuant to this Agreement or any of the
Obligations, or if any Loan Document ceases to be in full force and effect
(other than by reason of any action by the Agent), or if without the
written consent of the Agent and the Lenders, this Agreement or any other
Loan Document shall be disaffirmed or shall terminate, be terminable or be
terminated or become void or unenforceable for any reason whatsoever (other
than in accordance with its terms in the absence of default or by reason of
any action by the Lenders or the Agent); or
(e) if a default shall occur, which is not waived, (i) in the payment
of any principal, interest, premium or other amounts with respect to any
Consolidated Indebtedness (other than the Loans and the Consolidated
Indebtedness owing to any Lender) of any of the Borrowers in an amount not
less than $500,000 in the aggregate outstanding, or (ii) in the
performance, observance or fulfillment of any term or covenant contained in
any agreement or instrument under or pursuant to which any such
Consolidated Indebtedness may have been issued, created, assumed,
guaranteed or secured by any of the Borrowers, and such default shall
continue for more than the period of grace, if any, therein specified, and
if such default shall permit the holder of any such Indebtedness to
accelerate the maturity thereof; or
(f) if any material representation, warranty or other statement of
fact contained herein or any other Loan Document or in any writing,
certificate, report or statement at any time furnished to the Agent or any
Lender by or on behalf of the Borrowers pursuant to or in connection with
this Agreement or the other Loan Documents, or otherwise, shall be false or
misleading in any material respect when given; or
(g) if any of the Borrowers shall be unable to pay its debts generally
as they become due; file a petition to take advantage of any insolvency
statute; make an assignment for the benefit of its creditors; commence a
proceeding for the appointment of a receiver, trustee, liquidator or
conservator of itself or of the whole or any substantial part of its
property; file a petition or answer seeking reorganization or arrangement
or similar relief under the federal bankruptcy laws or any other applicable
law or statute; or
(h) if a court of competent jurisdiction shall enter an order,
judgment or decree appointing a custodian, receiver, trustee, liquidator or
conservator of any of the Borrowers or of the whole or any substantial part
of its properties and such order, judgment or decree continues unstayed and
in effect for a period of sixty (60) days, or approve a petition filed
against any of the Borrowers seeking reorganization or arrangement or
similar relief under the federal bankruptcy laws or any other applicable
law or statute of the United States of America or any state, which petition
is not dismissed within sixty (60) days; or if, under the provisions of any
other law for the relief or aid of debtors, a court of competent
jurisdiction shall assume custody or control of any of the Borrowers or of
the whole or any substantial part of its properties, which control is not
relinquished within sixty (60) days; or if there is commenced against any
of the Borrowers any proceeding or petition seeking reorganization,
arrangement or similar relief under the federal bankruptcy laws or any
other applicable law or statute of the United States of America or any
state which proceeding or petition remains undismissed for a period of
sixty (60) days; or if any of the Borrowers takes any action to indicate
its consent to or approval of any such proceeding or petition; or
(i) if (i) any judgment where the amount not reasonably expected to be
covered by insurance (or the amount as to which the insurer denies
liability) is in excess of $250,000 is rendered against any of the
Borrowers and remains unpaid, unstayed, undischarged, unbonded or
undismissed for a period of sixty (60) days, or (ii) there is any
attachment, injunction or execution against any of the Borrowers'
properties for any amount in excess of $250,000, and such attachment,
injunction or execution remains unpaid, unstayed, undischarged, unbonded or
undismissed for a period of sixty (60) days or (iii) any fine or fines for
violation or alleged violation of Environmental Laws in excess of
$2,000,000 in any Fiscal Year is rendered against any of the Borrowers; or
(j) if any of the Borrowers shall, other than in the ordinary course
of business (as determined by past practices), suspend all or any part of
its operations material to the conduct of the business of such Borrower for
a period of more than 120 days; or
(k) if any of the Borrowers shall breach any of the material terms or
conditions of any Swap Agreement among the Lenders and such breach shall
continue beyond any grace period, if any, relating thereto pursuant to its
terms;
then, and in any such event and at any time thereafter, if such Event of
Default or any other Event of Default shall have not been waived,
(a) either or both of the following actions may be taken:
(i) the Agent, with the consent of the Required Lenders, may, and
at the direction of the Required Lenders shall, declare any
obligation of the Lenders to make further Revolving Loans
terminated, whereupon the obligation of each Lender to make
further Revolving Loans and of Issuing Bank to issue Letters of
Credit, hereunder shall terminate immediately, and (ii) the Agent
shall at the direction of the Required Lenders, at their option,
declare by notice to an Authorized Representative any or all of
the Obligations to be immediately due and payable, and the same,
including all interest accrued thereon and all other obligations
of the Borrowers to the Agent and the Lenders, shall forthwith
become immediately due and payable without presentment, demand,
protest, notice or other formality of any kind, all of which are
hereby expressly waived, anything contained herein or in any
instrument evidencing the Obligations to the contrary
notwithstanding; provided, however, that notwithstanding the
above, if there shall occur an Event of Default under clause (g)
or (h) above, then the obligation of the Lenders to make
Revolving Loans hereunder shall automatically terminate and any
and all of the Obligations shall be immediately due and payable
without the necessity of any action by the Agent or the Required
Lenders or notice to the Agent or the Lenders;
(b) The Borrowers shall, upon demand of the Agent or the
Required Lenders, deposit cash with the Agent in an amount equal
to the amount of any Letter of Credit Outstandings, as collateral
security for the repayment of any future drawings or payments
under such Letters of Credit, and such amounts shall be held by
the Agent pursuant to the terms of the applicable Application for
Letter of Credit; and
(c) the Agent and each of the Lenders shall have all of the
rights and remedies available under the Loan Documents or under
any applicable law.
10.2 Agent to Act. In case any one or more Events of Default shall occur
and not have been waived, the Agent may, and at the direction of the Required
Lenders shall, proceed to protect and enforce their rights or remedies either by
suit in equity or by action at law, or both, whether for the specific
performance of any covenant, agreement or other provision contained herein or in
any other Loan Document, or to enforce the payment of the Obligations or any
other legal or equitable right or remedy.
10.3 Cumulative Rights. No right or remedy herein conferred upon the
Lenders or the Agent is intended to be exclusive of any other rights or remedies
contained herein or in any other Loan Document, and every such right or remedy
shall be cumulative and shall be in addition to every other such right or remedy
contained herein and therein or now or hereafter existing at law or in equity or
by statute, or otherwise.
10.4 No Waiver. No course of dealing between any of the Borrowers and any
Lender or the Agent or any failure or delay on the part of any Lender or the
Agent in exercising any rights or remedies under any Loan Document or otherwise
available to it shall operate as a waiver of any rights or remedies and no
single or partial exercise of any rights or remedies shall operate as a waiver
or preclude the exercise of any other rights or remedies hereunder or of the
same right or remedy on a future occasion.
10.5 Allocation of Proceeds. If an Event of Default has occurred and not
been waived, and the maturity of the Notes has been accelerated pursuant to
Article XI hereof, all payments received by the Agent hereunder, in respect of
any principal of or interest on the Obligations or any other amounts payable by
the Borrowers hereunder shall be applied by the Agent in the following order:
(a) amounts due to Issuing Bank and the Lenders pursuant to Sections
2.8, 4.3, 4.4 and 12.6 hereof;
(b) amounts due to the Agent pursuant to Section 11.10 hereof;
(c) payments of interest on Loans and Reimbursement Obligations;
(d) payments of principal on Loans and Reimbursement Obligations;
(e) payment of cash amounts to the Agent in respect of Letters of
Credit Outstandings pursuant to Section 10.1(B) hereof;
(f) amounts due to the Lenders pursuant to Sections 8.14 and 12.10
hereof;
(g) payments of all other amounts due under this Agreement, if any, to
be applied for the ratable benefit of the Lenders; and
(h) any surplus remaining after application as provided for herein, to
the Borrowers or otherwise as may be required by applicable law.
ARTICLE XI
The Agent
11.1 Appointment. Each Lender hereby irrevocably designates and appoints
SouthTrust as the Agent of the Lenders under this Agreement, and each of the
Lenders hereby irrevocably authorizes SouthTrust as the Agent for such Lender,
to take such action on its behalf under the provisions of this Agreement and the
other Loan Documents and to exercise such powers as are expressly delegated to
the Agent by the terms of this Agreement, together with such other powers as are
reasonably incidental thereto. The Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any of the Lenders, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or otherwise exist against the Agent.
11.2 Attorneys-in-fact. The Agent may execute any of its duties under this
Agreement 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 of any agents or attorneys-in-fact
selected by it with reasonable care.
11.3 Limitation on Liability. Neither the Agent nor any of its officers,
directors, employees, agents or attorneys-in-fact shall be liable to the Lenders
for any action lawfully taken or omitted to be taken by it or them under or in
connection with this Agreement except for its or their own gross negligence or
willful misconduct. Neither the Agent nor any of its affiliates shall be
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by any of the Borrowers or any officer or
representative thereof contained in this Agreement or in any of the other Loan
Documents, or in any certificate, report, statement or other document referred
to or provided for in or received by the Agent under or in connection with this
Agreement, or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any of the other Loan
Documents, or for any failure of any of the Borrowers to perform its obligations
thereunder, or for any recitals, statements, representations or warranties made,
or for the value, validity, effectiveness, genuineness, enforceability or
sufficiency of any collateral. The Agent shall not be under any obligation to
any of the Lenders to ascertain or to inquire as to the observance or
performance of any of the terms, covenants or conditions of this Agreement or
any of the other Loan Documents on the part of any of the Borrowers or to
inspect the properties, books or records of any of the Borrowers.
11.4 Reliance. 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 or telex 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 the Borrowers), independent accountants and other experts
selected by the Agent. The Agent may deem and treat the payee of any Note as the
owner thereof for all purposes unless an Assignment shall have been filed with
and accepted by the Agent. The Agent shall be fully justified in failing or
refusing to take any action under this Agreement unless it shall first receive
advice or concurrence of the Lenders or the Required Lenders as provided in this
Agreement 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, under this Agreement in
accordance with a request of the Required Lenders, and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Lenders and all present and future holders of the Notes.
11.5 No Representations. Each Lender expressly acknowledges that neither
the Agent nor any of its affiliates has made any representations or warranties
to it and that no act by the Agent hereafter taken, including any review of the
affairs of the Borrowers, shall be deemed to constitute any representation or
warranty by the Agent to any Lender. Each Lender represents to the Agent that it
has, independently and without reliance upon the Agent or any other Lender, and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the financial condition,
creditworthiness, affairs, status and nature of the Borrowers and made its own
decision to enter into this Agreement. Each Lender also represents that it will,
independently and without reliance upon the Agent or any other Lender, and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and to make such investigation as it
deems necessary to inform itself as to the status and affairs, financial or
otherwise, of each of the Borrowers. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the Agent
hereunder, the Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the affairs, financial
condition or business of each of the Borrowers which may come into the
possession of the Agent or any of its affiliates.
11.6 Indemnification. Each of the Lenders agrees to indemnify the Agent in
its capacity as such (to the extent not reimbursed by the Borrowers and without
limiting any obligations of the Borrowers so to do), ratably according to the
respective principal amount of the Notes and Participations held by them (or, if
no Notes or Participations are outstanding, ratably in accordance with their
respective Applicable Commitment Percentages as then in effect) from and against
any and all liabilities, obligations, losses (excluding any losses suffered by
the Agent as a result of Borrowers' failure to pay any fee owing to the Agent),
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever which may at any time (including without
limitation at any time following the payment of the Notes) be imposed on,
incurred by or asserted against the Agent in any way relating to or arising out
of this Agreement, the other Loan Documents or any other document contemplated
by or referred to herein or the transactions contemplated hereby or any action
taken or omitted by the Agent under or in connection with any of the foregoing;
provided that no 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 Agent's gross negligence,
fraud, intentional tortious conduct or willful misconduct. The agreements in
this subsection shall survive the payment of the Obligations and the termination
of this Agreement.
11.7 Lender. The Agent and its affiliates may make loans to, accept
deposits from and generally engage in any kind of business with each of the
Borrowers as though it were not the Agent hereunder. With respect to its Loans
made or renewed by it and any Note issued to it, the Agent shall have the same
rights and powers under this Agreement as any Lender and may exercise the same
as though it were not the Agent, and the terms "Lender" and "Lenders" shall,
unless the context otherwise indicates, include the Agent in its individual
capacity.
11.8 Resignation. If the Agent shall resign as Agent under this Agreement,
then the Required Lenders may appoint, with the consent, so long as there shall
not have occurred and be continuing a Default or Event of Default, of the
Borrowers, which consent shall not be unreasonably withheld, a successor Agent
for the Lenders, which successor Agent shall be a commercial bank organized
under the laws of the United States or any state thereof, having a combined
surplus and capital of not less than $500,000,000, whereupon such successor
Agent shall succeed to the rights, powers and duties of the former Agent and the
obligations of the former Agent shall be terminated and canceled, without any
other or further act or deed on the part of such former Agent or any of the
parties to this Agreement; provided, however, that the former Agent's
resignation shall not become effective until such successor Agent has been
appointed and has succeeded of record to all right, title and interest in any
collateral held by the Agent; provided, further, that if the Required Lenders
and, if applicable, the Borrowers cannot agree as to a successor Agent within
ninety (90) days after such resignation, the Agent shall appoint a successor
Agent which satisfies the criteria set forth above in this Section 11.8 for a
successor Agent and the parties hereto agree to execute whatever documents are
necessary to effect such action under this Agreement or any other document
executed pursuant to this Agreement; provided, however that in such event all
provisions of this Agreement and the Loan Documents, shall remain in full force
and effect. After any retiring Agent's resignation hereunder as Agent, the
provisions of this Article XI shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was Agent under this Agreement.
11.9 Sharing of Payments, etc. Each Lender agrees that if it shall, through
the exercise of a right of banker's lien, set-off, counterclaim or otherwise,
obtain payment with respect to its Obligations (other than pursuant to Article
V) which results in its receiving more than its pro rata share of the aggregate
payments with respect to all of the Obligations (other than any payment pursuant
to Article V), then (a) such Lender shall be deemed to have simultaneously
purchased from the other Lenders a share in their Obligations so that the amount
of the Obligations held by each of the Lenders shall be pro rata and (b) such
other adjustments shall be made from time to time as shall be equitable to
insure that the Lenders share such payments ratably; provided, however, that for
purposes of this Section 11.9 the term "pro rata" shall be determined with
respect to the Revolving Credit Commitment of each Lender and to the Total
Revolving Credit Commitments after subtraction in each case of amounts, if any,
by which any such Lender has not funded its share of the outstanding Loans,
Participations and Obligations. If all or any portion of any such excess payment
is thereafter recovered from the Lender which received the same, the purchase
provided in this Section 11.9 shall be rescinded to the extent of such recovery,
without interest. The Borrowers expressly consent to the foregoing arrangements
and agree that each Lender so purchasing a portion of the other Lenders'
Obligations may exercise all rights of payment (including, without limitation,
all rights of set-off, banker's lien or counterclaim) with respect to such
portion as fully as if such Lender were the direct holder of such portion.
11.10 Fees. The Borrowers agree to pay to the Agent, for its individual
account, an annual Agent's fee as from time to time agreed to by the Borrowers
and Agent in writing.
ARTICLE XII
Miscellaneous
12.1 Confidentiality. Each Lender agrees to take and to cause its
Affiliates to take normal and reasonable precautions and exercise due care to
maintain the confidentiality of all information identified as "confidential" or
"secret" by the Borrowers and provided to it by any Borrower or by the Agent on
the Borrowers' behalf under this Agreement or any other Loan Document, and
neither such Lender nor any of its Affiliates shall use any such information
other than in connection with or in enforcement of this Agreement and the other
Loan Documents or in connection with other business now or hereafter existing or
contemplated with any Borrower; except to the extent such information (i) was or
becomes generally available to the public other than as a result of disclosure
by such Lender, or (ii) was or becomes available on a non-confidential basis
from a source other than a Borrower, provided that such source is not bound by a
confidentiality agreement with any Borrower known to such Lender; provided,
however, that any Lender may disclose such information (A) at the request or
pursuant to any requirement of any Governmental Authority to which such Lender
is subject or in connection with an examination of such Lender by any such
authority; (B) pursuant to subpoena or other court process; (C) when required to
do so in accordance with the provisions of any applicable requirement of law;
(D) to the extent reasonably required in connection with any litigation or
proceeding to which the Agent or any Lender or any of their respective
Affiliates may be party; (E) to the extent reasonably required in connection
with the exercise of any remedy hereunder or under any other Loan Document; (F)
to such Lender's independent auditors and other professional advisors; (G) to
any participant or assignee of any Lender, actual or potential, provided that
such Person agrees in writing to keep such information confidential to the same
extent required of the Lenders hereunder ; (H) as to any Lender or its
Affiliate, as expressly permitted under the terms of any other document or
agreement regarding confidentiality to which any Borrower is party or is deemed
party with such Lender or such Affiliate; and (I) to its Affiliates.
12.2 Assignments and Participations.
(a) At any time after the Closing Date each Lender may, with the prior
consent of the Agent and the Borrowers, which consents shall not be
unreasonably withheld, assign to one or more banks or financial
institutions all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of the Note
payable to its order); provided, that (i) each such assignment shall be of
a constant and not a varying percentage of all of the assigning Lender's
rights and obligations (including the Revolving Loans and Participations)
under this Agreement, (ii) for each assignment involving the issuance and
transfer of a Note, the assigning Lender shall execute an Assignment and
Acceptance and the Borrowers hereby consent to execute a replacement Note
to give effect to the assignment, (iii) the minimum Revolving Credit
Commitment and Term Loan Commitment which shall be assigned is $5,000,000
(together with which the assigning Lender's applicable portion of
Participations and the Letter of Credit Commitment shall also be assigned),
(iv) such assignee shall have an office located in the United States, (v)
an assignment (other than an assignment of 100% of its Interest) by Issuing
Bank shall not include any portion of the obligation to issue Letters of
Credit, and (vi) no consent of the Borrowers or the Agent shall be required
in connection with any assignment by a Lender to another Lender or to such
Lender's affiliate. Upon such execution, delivery, approval and acceptance,
from and after the effective date specified in each Assignment and
Acceptance, (x) the assignee thereunder shall be a party hereto and, to the
extent that rights and obligations hereunder or under such Note have been
assigned or negotiated to it pursuant to such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder and a holder of such
Note and (y) the assignor thereunder shall, to the extent that rights and
obligations hereunder or under such Note have been assigned or negotiated
by it pursuant to such Assignment and Acceptance, relinquish its rights and
be released from its obligations under this Agreement. Any Lender who makes
an assignment (other than an assignment pursuant to clause (v) above) shall
pay to the Agent a one-time administrative fee of $5,000.00 which fee shall
not be reimbursed by the Borrowers.
(b) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) the assignment
made under such Assignment and Acceptance is made under such Assignment and
Acceptance without recourse; (ii) such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to
the financial condition of any of the Borrowers or the performance or
observance by any of the Borrowers of any of its obligations under any Loan
Document or any other instrument or document furnished pursuant hereto;
(iii) such assignee confirms that it has received a copy of this Agreement,
together with copies of the financial statements delivered pursuant to
Section 7.6(a) or Section 8.1, as the case may be, and such other Loan
Documents and other documents and information as it has deemed appropriate
to make its own credit analysis and decision to enter into such Assignment
and Acceptance; (iv) such assignee will, independently and without reliance
upon the Agent, such assigning Lender or any other Lender and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under this Agreement; (v) such assignee appoints and authorizes the Agent
to take such action as agent on its behalf and to exercise such powers
under this Agreement, the Notes and the other Loan Documents as are
delegated to the Agent by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto; and (vi) such assignee agrees
that it will perform in accordance with their terms all of the obligations
which by the terms of this Agreement are required to be performed by it as
a Lender and a holder of such Notes.
(c) The Agent shall maintain at its address referred to herein a copy
of each Assignment and Acceptance delivered to and accepted by it.
(d) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender, the Agent shall give prompt notice thereof to the
Authorized Representative.
(e) Nothing herein shall prohibit any Lender from pledging or
assigning, without notice or consent, any Note to any Federal Reserve Bank
in accordance with applicable law.
(f) Each Lender may sell participations at its expense to one or more
banks or other entities as to all or a portion of its rights and
obligations under this Agreement; provided, that (i) such Lender's
obligations under this Agreement shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) such Lender shall remain the holder
of any Note issued to it for the purpose of this Agreement, (iv) such
participations shall be in a minimum amount of $1,000,000 and shall include
an allocable portion of such Lender's Participation, and (v) each of the
Borrowers, the Agent and the other Lenders shall continue to deal solely
and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and with regard to any and all payments to
be made under this Agreement; provided, that the participation agreement
between a Lender and its participants may provide that such Lender will
obtain the approval of such participant prior to such Lender's agreeing to
any amendment or waiver of any provisions of this Agreement which would (A)
extend the maturity of any Note, (B) reduce the interest rate hereunder or
(C) increase the Revolving Credit Commitment or Term Loan Commitment of the
Lender granting the participation, and (vi) the sale of any such
participations which require any of the Borrowers to file a registration
statement with the United States Securities and Exchange Commission or
under the securities regulations or laws of any state shall not be
permitted.
(g) None of the Borrowers may assign any rights, powers, duties or
obligations under this Agreement or the other Loan Documents without the
prior written consent of all the Lenders.
12.3 Notices. Any notice shall be conclusively deemed to have been received
by any party hereto and be effective on the day on which delivered to such party
(against receipt therefor) at the address set forth below or such other address
as such party shall specify to the other parties in writing (or, in the case of
notice by telecopy, telegram or telex (where the receipt of such message is
verified by return) expressly provided for hereunder, when received at such
telecopy or telex number as may from time to time be specified in written notice
to the other parties hereto or otherwise received), or if sent prepaid by
certified or registered mail return receipt requested on the fifth Business Day
after the day on which mailed, addressed to such party at said address:
(a) if to any of the Borrowers:
Giant Cement Holding, Inc.
000-X Xxxxxxx Xxxxxxx
Xxxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxx
Vice President and Chief Financial Officer
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
and a copy to:
Keystone Cement Company
Xxxx Xxxxxx Xxx X
Xxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxx X. Xxxxxxx
President and CEO
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
(b) if to the Agent:
SouthTrust Bank, National Association
000 Xxxx XxXxx Xxxxxx
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxx Xxxx
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
with a copy to:
SouthTrust Bank, National Association
0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxx Xxxxxxx
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
(c) if to the Lenders:
At the addresses set forth on the signature pages hereof and on
the signature page of each Assignment and Acceptance.
12.4 Setoff. Each of the Borrowers agrees that the Agent and each Lender
shall have a lien for all the Obligations of the Borrowers upon all deposits or
deposit accounts, of any kind, or any interest in any deposits or deposit
accounts thereof, now or hereafter pledged, mortgaged, transferred or assigned
to the Agent or such Lender or otherwise in the possession or control of the
Agent or such Lender (other than for safekeeping) for any purpose for the
account or benefit of such Borrower and including any balance of any deposit
account or of any credit of such Borrower with the Agent or such Lender, whether
now existing or hereafter established, hereby authorizing the Agent and each
Lender at any time or times with or without prior notice to apply such balances
or any part thereof to such of the Obligations of the Borrowers to the Lenders
then past due and in such amounts as they may elect, and whether or not the
collateral or the responsibility of other Persons primarily, secondarily or
otherwise liable may be deemed adequate. For the purposes of this paragraph, all
remittances and property shall be deemed to be in the possession of the Agent or
such Lender as soon as the same may be put in transit to it by mail or carrier
or by other bailee.
12.5 Survival. All covenants, agreements, representations and warranties
made herein shall survive the making by the Lenders of the Loans and the
execution and delivery to the Lenders of this Agreement and the Notes and shall
continue in full force and effect so long as any of Obligations remain
outstanding or any Lender has any commitment hereunder or the Borrowers have
continuing obligations hereunder unless otherwise provided herein. Whenever in
this Agreement, any of the parties hereto is referred to, such reference shall
be deemed to include the successors and permitted assigns of such party and all
covenants, provisions and agreements by or on behalf of the Borrowers which are
contained in this Agreement, the Notes and the other Loan Documents shall inure
to the benefit of the successors and permitted assigns of the Lenders or any of
them.
12.6 Expenses. Each of the Borrowers jointly and severally agrees (a) to
pay or reimburse the Agent for all its reasonable out-of-pocket costs and
expenses incurred in connection with the preparation, negotiation and execution
of, and any amendment, supplement or modification to, this Agreement or any of
the other Loan Documents (including travel expenses relating to closing), and
the consummation of the transactions contemplated hereby and thereby, including,
without limitation, the reasonable fees and disbursements of counsel to the
Agents, (b) to pay or reimburse the Agent and each of the Lenders for all their
costs and expenses incurred in connection with the enforcement (only from and
after the occurrence of a Default or Event of Default) or preservation of any
rights under this Agreement and the other Loan Documents, including without
limitation, the reasonable fees and disbursements of their counsel and any
payments in indemnification or otherwise payable by the Lenders to the Agent
pursuant to the Loan Documents and (c) to pay, indemnify and hold the Agent and
each of the Lenders harmless from any and all recording and filing fees and any
and all liabilities with respect to, or resulting from any failure to pay or
delay in paying, documentary, stamp, excise and other similar taxes, if any,
which may be payable or determined to be payable in connection with the
execution and delivery of this Agreement or any other Loan Documents, or
consummation of any amendment, supplement or modification of, or any waiver or
consent under or in respect of, this Agreement or any other Loan Documents.
12.7 Amendments. No amendment, modification or waiver of any provision of
this Agreement or any of the Loan Documents and no consent by the Lenders to any
departure therefrom by any of the Borrowers shall be effective unless such
amendment, modification or waiver shall be in writing and signed by the Agent,
shall have been approved by the Required Lenders through their written consent,
and the same shall then be effective only for the period and on the conditions
and for the specific instances and purposes specified in such writing; provided,
however, that, no such amendment, modification or waiver
(i) which changes, extends or waives any provision of Section
11.9 or this Section 12.6, the amount of or the due date of any
scheduled installment of or the rate of interest payable on any
Obligation, which changes the definition of Required Lenders, which
permits an assignment by any of the Borrowers of its Obligations
hereunder, which reduces the required consent of Lenders provided
hereunder, which increases, decreases or extends the Revolving Credit
Commitment, Term Loan Commitment or the Letter of Credit Commitment of
any Lender, which waives any Default or Event of Default under Section
10.1(g) or (h) hereof or which waives any condition to the making of
any Loan shall be effective unless in writing and signed by each of
the Lenders; or
(ii) which affects the rights, privileges, immunities or
indemnities of the Agent shall be effective unless in writing and
signed by the Agent.
Notwithstanding any provision of the other Loan Documents to the contrary, as
between the Agent and the Lenders, execution by the Agent shall not be deemed
conclusive evidence that the Agent has obtained the written consent of the
Required Lenders. No notice to or demand on any of the Borrowers in any case
shall entitle any of the Borrowers to any other or further notice or demand in
similar or other circumstances, except as otherwise expressly provided herein.
No delay or omission on any Lender's or the Agent's part in exercising any
right, remedy or option shall operate as a waiver of such or any other right,
remedy or option or of any Default or Event of Default.
12.8 Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, and it shall not be necessary in making proof of this Agreement to
produce or account for more than one such fully-executed counterpart.
12.9 Termination. The termination of this Agreement shall not affect any
rights of any of the Borrowers, the Lenders or the Agent or any obligation of
any of the Borrowers, the Lenders or the Agent, arising prior to the effective
date of such termination, and the provisions hereof shall continue to be fully
operative until all transactions entered into or rights created or obligations
incurred prior to such termination have been fully disposed of, concluded or
liquidated and the Obligations arising prior to or after such termination have
been irrevocably paid in full. The rights granted to the Agent for the benefit
of the Lenders hereunder and under the other Loan Documents shall continue in
full force and effect, notwithstanding the termination of this Agreement, until
all of the Obligations have been paid in full after the termination hereof
(other than Obligations in the nature of continuing indemnities or expense
reimbursement obligations not yet due and payable) or the Borrowers have
furnished the Lenders and the Agent with an indemnification satisfactory to the
Agent and each Lender with respect thereto. All representations, warranties,
covenants, waivers and agreements contained herein shall survive termination
hereof until payment in full of the Obligations unless otherwise provided
herein. Notwithstanding the foregoing, if after receipt of any payment of all or
any part of the Obligations, any Lender is for any reason compelled to surrender
such payment to any Person because such payment is determined to be void or
voidable as a preference, impermissible setoff, a diversion of trust funds or
for any other reason, this Agreement shall continue in full force and each of
the Borrowers shall be liable to, and shall indemnify and hold such Lender
harmless for, the amount of such payment surrendered until such Lender shall
have been finally and irrevocably paid in full. The provisions of the foregoing
sentence shall be and remain effective notwithstanding any contrary action which
may have been taken by the Lenders in reliance upon such payment, and any such
contrary action so taken shall be without prejudice to the Lenders' rights under
this Agreement and shall be deemed to have been conditioned upon such payment
having become final and irrevocable.
12.10 Governing Law.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF SOUTH CAROLINA APPLICABLE TO CONTRACTS
EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
(b) EACH BORROWER HEREBY EXPRESSLY AND IRREVOCABLY AGREES AND CONSENTS
THAT ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREIN MAY BE INSTITUTED IN ANY
STATE OR FEDERAL COURT SITTING IN THE COUNTY OF MECKLENBURG OF NORTH
CAROLINA, UNITED STATES OF AMERICA AND, BY THE EXECUTION AND DELIVERY OF
THIS AGREEMENT, EACH BORROWER EXPRESSLY WAIVES ANY OBJECTION THAT IT MAY
HAVE NOW OR HEREAFTER TO THE LAYING OF THE VENUE OR TO THE JURISDICTION OF
ANY SUCH SUIT, ACTION OR PROCEEDING, AND IRREVOCABLY SUBMITS GENERALLY AND
UNCONDITIONALLY TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT,
ACTION OR PROCEEDING.
(c) EACH BORROWER AGREES THAT SERVICE OF PROCESS MAY BE MADE BY
PERSONAL SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT OR OTHER LEGAL
PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING, OR BY REGISTERED OR
CERTIFIED MAIL (POSTAGE PREPAID) TO THE ADDRESS OF SUCH BORROWER PROVIDED
IN SECTION 10.2 HEREOF, OR BY ANY OTHER METHOD OF SERVICE PROVIDED FOR
UNDER THE APPLICABLE LAWS IN EFFECT IN THE STATE OF NORTH CAROLINA.
(d) NOTHING CONTAINED IN SUBSECTIONS (B) OR (C) HEREOF SHALL PRECLUDE
A LENDER FROM BRINGING ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS IN THE COURTS OF ANY
PLACE WHERE ANY BORROWER OR ANY OF THE BORROWERS' PROPERTY OR ASSETS MAY BE
FOUND OR LOCATED. TO THE EXTENT PERMITTED BY THE APPLICABLE LAWS OF ANY
SUCH JURISDICTION, EACH BORROWER HEREBY IRREVOCABLY SUBMITS TO THE
JURISDICTION OF ANY SUCH COURT AND EXPRESSLY WAIVES, IN RESPECT OF ANY SUCH
SUIT, ACTION OR PROCEEDING, THE JURISDICTION OF ANY OTHER COURT OR COURTS
WHICH NOW OR HEREAFTER, BY REASON OF ITS PRESENT OR FUTURE DOMICILE, OR
OTHERWISE, MAY BE AVAILABLE TO IT.
(e) IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS OR
REMEDIES UNDER OR RELATED TO THIS AGREEMENT OR ANY AMENDMENT, INSTRUMENT,
DOCUMENT OR AGREEMENT DELIVERED OR THAT MAY IN THE FUTURE BE DELIVERED IN
CONNECTION WITH THE FOREGOING, EACH BORROWER HEREBY AGREES, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, THAT ANY SUCH ACTION OR PROCEEDING SHALL BE
TRIED BEFORE A COURT AND NOT BEFORE A JURY AND EACH BORROWER HEREBY WAIVES,
TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY HAVE
THAT EACH ACTION OR PROCEEDING HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
12.11 Indemnification. In consideration of the execution and delivery of
this Agreement by the Agent and each Lender and the extension of the Revolving
Credit Commitments and the Letter of Credit Commitments, each of the Borrowers
hereby jointly and severally indemnifies, exonerates and holds the Agent and
each Lender and each of their respective officers, directors, employees and
agents (collectively, the "Indemnified Parties") free and harmless from and
against any and all actions, causes of action, suits, losses, costs, liabilities
and damages, and expenses incurred in connection therewith (irrespective of
whether any such Indemnified Party is a party to the action for which
indemnification hereunder is sought), including reasonable attorneys' fees and
disbursements (collectively, the "Indemnified Liabilities"), incurred by the
Indemnified Parties or any of them as a result of, or arising out of, or
relating to the execution, delivery, enforcement performance or administration
of this Agreement and the other Loan Documents, or any transaction financed or
to be financed in whole or in part, directly or indirectly, or supported by any
Letter of Credit, except for any such Indemnified Liabilities arising for the
account of a particular Indemnified Party by reason of the gross negligence or
willful misconduct of such particular Indemnified Party and if and to the extent
that the foregoing undertaking may be unenforceable for any reason, each of the
Borrowers hereby agrees to make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities which is permissible under
applicable law. The provisions of this Section 12.11 shall survive repayment of
the Obligations, occurrence of the Revolving Credit Termination Date and
expiration or termination of this Agreement.
12.12.Headings and References. The headings of the Articles and Sections of
this Agreement are inserted for convenience of reference only and are not
intended to be a part of, or to affect the meaning or interpretation of this
Agreement. Words such as "hereof", "hereunder", "herein" and words of similar
import shall refer to this Agreement in its entirety and not to any particular
Section or provisions hereof, unless so expressly specified. As used herein, the
singular shall include the plural, and the masculine shall include the feminine
or a neutral gender, and vice versa, whenever the context requires.
12.13 Severability. If any provision of this Agreement or the other Loan
Documents shall be determined to be illegal or invalid as to one or more of the
parties hereto, then such provision shall remain in effect with respect to all
parties, if any, as to whom such provision is neither illegal nor invalid, and
in any event all other provisions hereof shall remain effective and binding on
the parties hereto.
12.14 Entire Agreement. This Agreement, together with the other Loan
Documents, constitutes the entire agreement between the parties with respect to
the subject matter hereof and supersedes all previous proposals, negotiations,
representations, commitments and other communications between or among the
parties, both oral and written, with respect thereto.
12.15 Agreement Controls. In the event that any term of any of the Loan
Documents other than this Agreement conflicts with any term of this Agreement,
the terms and provisions of this Agreement shall control.
12.16 Usury Savings Clause. Notwithstanding any other provision herein, the
aggregate interest rate charged under any of the Notes, including all charges or
fees in connection therewith deemed in the nature of interest under North
Carolina law shall not exceed the Highest Lawful Rate (as such term is defined
below). If the rate of interest (determined without regard to the preceding
sentence) under this Agreement at any time exceeds the Highest Lawful Rate (as
defined below), the outstanding amount of the Loans made hereunder shall bear
interest at the Highest Lawful Rate until the total amount of interest due
hereunder equals the amount of interest which would have been due hereunder if
the stated rates of interest set forth in this Agreement had at all times been
in effect. In addition, if when the Loans made hereunder are repaid in full the
total interest due hereunder (taking into account the increase provided for
above) is less than the total amount of interest which would have been due
hereunder if the stated rates of interest set forth in this Agreement had at all
times been in effect, then to the extent permitted by law, the Borrowers shall
pay to the Agent an amount equal to the difference between the amount of
interest paid and the amount of interest which would have been paid if the
Highest Lawful Rate had at all times been in effect. Notwithstanding the
foregoing, it is the intention of the Lenders and the Borrowers to conform
strictly to any applicable usury laws. Accordingly, if any Lender contracts for,
charges, or receives any consideration which constitutes interest in excess of
the Highest Lawful Rate, then any such excess shall be canceled automatically
and, if previously paid, shall at such Lender's option be applied to the
outstanding amount of the Loans made hereunder or be refunded to the Borrowers.
As used in this paragraph, the term "Highest Lawful Rate" means the maximum
lawful interest rate, if any, that at any time or from time to time may be
contracted for, charged, or received under the laws applicable to such Lender
which are presently in effect or, to the extent allowed by law, under such
applicable laws which may hereafter be in effect and which allow a higher
maximum nonusurious interest rate than applicable laws now allow.
12.17 Joint and Several Obligations. All obligations and liabilities
incurred by the Borrowers hereunder and under any other Loan Document, including
without limitation payment of any Obligation, shall be joint and several among
the Borrowers.
[Signature pages follow.]
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
made, executed and delivered by their duly authorized officers as of the day and
year first above written.
GIANT CEMENT HOLDING, INC.
ATTEST: By:______________________
Name: Xxxxx X. Xxxxxx
______________________ Title: Vice President
Xxxxxx X. Xxxx,
Assistant Secretary
[CORPORATE SEAL]
GIANT CEMENT COMPANY
KEYSTONE CEMENT COMPANY
GIANT RESOURCE RECOVERY COMPANY, INC.
GCHI INVESTMENTS, INC.
GIANT CEMENT NC, INC.
SOLITE CORPORATION
EDEN MACHINE AND DESIGN CORPORATION
CAROLINA SOLITE CORPORATION
SOLITE LIGHTWEIGHT TRANSPORTATION, INC.
OLDOVER TOO, INC.
OLDOVER CORPORATION
M&M CHEMICAL & EQUIPMENT CO., INC.
CHARLOTTE BLOCK, INC.
LIGHTWEIGHT BLOCK-EDEN CORPORATION
LIGHTWEIGHT BLOCK COMPANY,INCORPORATED
BOSTON CONCRETE PRODUCTS, INCORPORATED
LIGHTWEIGHT BLOCK LEXINGTON CORPORATION
ATTEST: By:______________________
Name: Xxxxx X. Xxxxxx
______________________ Title: Vice President
Xxxxxx X. Xxxx,
Assistant Secretary
[CORPORATE SEAL]
SOUTHTRUST BANK, NATIONAL ASSOCIATION, as
Agent for the Lenders
By:______________________
Name: Xxxx X. Xxxxxxx
Title: Vice President
SOUTHTRUST BANK, NATIONAL ASSOCIATION, as
Lender
By:______________________
Name: Xxxx X. Xxxxxxx
Title: Vice President
Lending Office:
SouthTrust Bank, National Association
000 X. 00xx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxx
Wire Transfer Instructions:
SouthTrust Bank, National Association
Birmingham, Alabama
ABA# 000000000
Account No.: 131009
Reference: Giant Cement
Attention: Southeastern Corporate Banking
AMENDED AND RESTATED SECURITY AGREEMENT
THIS AMENDED AND RESTATED SECURITY AGREEMENT (the "Security
Agreement"), dated as of April 30, 1998, by and among GIANT CEMENT HOLDING,
INC., a Delaware corporation ("Giant Holding"), EACH OF THE UNDERSIGNED
SUBSIDIARIES (together with Giant Holding, each referred to individually herein
as a "Borrower" and collectively as the "Borrowers") and SOUTHTRUST BANK,
NATIONAL ASSOCIATION, previously known as SouthTrust Bank of Alabama, National
Association, as Agent for each Lender from time to time party to the Credit
Agreement referenced below (the "Secured Party").
W I T N E S S E T H:
WHEREAS, each Borrower, the Lenders and the Secured Party
simultaneously with the entering into of this Security Agreement have entered
into an Amended and Restated Credit Agreement dated as of the date hereof (as at
any time hereafter amended, supplemented or replaced, the "Credit Agreement";
capitalized terms not otherwise defined in this Agreement shall have the meaning
given to such terms in the Credit Agreement); and
WHEREAS, as a condition to entering into the Credit Agreement, the
Lenders and the Secured Party have required that each Borrower secure the
Obligations under the Credit Agreement pursuant to the terms of this Security
Agreement;
NOW, THEREFORE, in consideration of the premises and in order to induce
the Secured Party to enter into the Credit Agreement, each Borrower hereby
agrees with the Secured Party for the benefit of the Lenders as follows:
1. Definitions. For purposes of this Security Agreement, in
addition to the terms set forth above, the following terms shall have the
respective meanings set forth below:
"Term Loan Obligations" means the obligations, liabilities and
Indebtedness of the Borrowers with respect to (i) the principal and
interest on the Term Loan and (ii) the payment and performance of all
other obligations, liabilities and Indebtedness of the Borrowers to the
Lenders or the Agent with respect to the Term Loan arising under the
Credit Agreement or any other Loan Document;
"Revolving Loan Obligations" means all Obligations of the
Borrowers other than the Term Loan Obligations;
All capitalized terms used but not otherwise defined herein shall have
the respective meanings assigned thereto in the Credit Agreement.
2. Grant of Security Interest.
(A) As collateral security for payment and satisfaction of the
Term Loan Obligations, each Borrower hereby grants to the Secured Party
for the benefit of the Lenders a continuing security interest in and to
all of the following property of such Borrower, whether now owned or
existing or hereafter acquired or arising:
(i) All accounts, accounts receivable, contract
rights, notes, bills, acceptances, choses in action, chattel
paper, instruments, documents, all present and future patents,
trademarks, copyrights and all applications therefor, other
general intangibles, all licenses (to the extent not
prohibited by the relevant licenses or applicable law), and
other forms of obligations at any time owing to such Borrower,
the proceeds thereof and all of such Borrower's rights with
respect to any goods represented thereby, whether or not
delivered, goods returned by customers and all rights as an
unpaid vendor or lienor, including rights of stoppage in
transit and of recovering possession by proceedings including
replevin and reclamation, together with all customer lists,
books and records, ledgers and account cards, computer tapes,
software, disks, printouts and records, whether now in
existence or hereafter created, relating to any of the
foregoing (collectively, the "Accounts");
(ii) All goods, merchandise and other personal
property, including, without limitation, goods in transit,
wheresoever located and whether now owned or hereafter
acquired by such Borrower which is or may at any time be held
for sale or lease, furnished under any contract of service or
held as raw materials, work-in-process, or supplies or
materials used or consumed in such Borrower's business,
including, without limitation, all such property the sale or
disposition of which has given rise to Accounts and which has
been returned to or repossessed or stopped in transit by such
Borrower (collectively, the "Inventory");
(iii) With respect to Keystone, all goods of Keystone
located at its Bath, Pennsylvania location set forth on
Schedule 4, including without limitation, all machinery,
equipment, parts, supplies, apparatus, appliances, tools,
patterns, molds, dies, blueprints, fittings, furniture,
furnishings, fixtures and articles of tangible personal
property of every description now or hereafter owned by
Keystone or in which Keystone may have or may hereafter
acquire any interest (collectively referred to hereinafter as
"Equipment");
(iv) All books and records (including without
limitation, customer data, credit files, computer programs,
printouts, and other computer materials and records) of such
Borrower pertaining to any of the foregoing; and
(v) All accessions to, substitutions for and all
replacements, products and proceeds of the foregoing,
including, without limitation, proceeds of insurance policies
insuring the foregoing.
All of the property and interests in property described above in
subsections (i) through (v) and all other property and interests in personal
property which shall, from time to time, secure the Term Loan Obligations are
herein collectively referred to as the "Term Loan Collateral."
(B) As collateral security for payment and satisfaction of the
Revolving Loan Obligations, each Borrower hereby grants to the Secured Party for
the benefit of the Lenders a continuing security interest in and to all of the
following property of such Borrower, whether now owned or existing or hereafter
acquired or arising:
(i) The Accounts;
(ii) The Inventory;
(iii) All books and records (including without
limitation, customer data, credit files, computer programs,
printouts, and other computer materials and records) of such
Borrower pertaining to any of the foregoing; and
(iv) All accessions to, substitutions for and all
replacements, products and proceeds of the foregoing,
including, without limitation, proceeds of insurance policies
insuring the foregoing.
All of the property and interests in property described above in
subsections (i) through (iv) and all other property and interests in personal
property which shall, from time to time, secure the Revolving Loan Obligations
are herein collectively referred to as the "Revolving Loan Collateral." The Term
Loan Collateral and the Revolving Loan Collateral are herein collectively
referred to as the "Collateral."
3. Financing Statements. At or prior to the time of execution of this
Security Agreement, each Borrower shall have furnished the Secured Party with
properly executed financing statements as prescribed by the Uniform Commercial
Code as presently in effect in each of the states where the Collateral owned by
such Borrower is located (the "Financing Statements"), the Financing Statements
shall be approved by the Secured Party and in form and number sufficient for
filing wherever required with respect to the Collateral, in order that the
Secured Party for the benefit of the Lenders shall have a duly perfected
security interest of record in the Collateral following the filing of such
Financing Statements with the appropriate governmental authorities, subject only
to those liens permitted by Section 9.6 of the Credit Agreement, and such
Borrower shall execute, as reasonably required by the Secured Party, any
additional financing statements or other documents to effect the same, together
with any necessary continuation statements so long as this Security Agreement
remains in effect.
4. Maintenance of Security Interest. Each Borrower will, from time to
time, upon the reasonable request of the Secured Party, deliver evidence of
ownership of the Collateral (copies of originals documents being sufficient
evidence) and specific collateral assignments of Collateral, together with such
other instruments and documents, financing statements, amendments thereto,
assignments or other writings as the Secured Party may reasonably request, to
carry out the terms of this Security Agreement or to protect or enforce the
security interest in the Collateral granted pursuant to this Security Agreement.
With respect to any and all Collateral to be secured and conveyed under
this Security Agreement, each Borrower agrees to do and cause to be done all
things necessary under the laws, rules and regulations of the applicable
jurisdiction to perfect and keep in full force the security interest granted
herein, including, but not limited to, the prompt payment of all fees and
expenses reasonably incurred in connection with any filings made to perfect a
security interest in the Collateral in favor of the Secured Party for the
benefit of the Lenders.
Each Borrower agrees to make appropriate entries upon its financial
statements and books and records disclosing the Secured Party's security
interest in the Collateral for the benefit of the Lenders.
5. Collections; Secured Party's Right to Notify Account Borrowers and
to Endorse Each Borrower's Name. Upon the occurrence and during the continuation
of an Event of Default, each Borrower hereby authorizes the Secured Party to (i)
open its mail and collect any and all amounts due to it from persons obligated
on any Accounts ("Account Debtors"); (ii) take over its post office boxes or
make other arrangements as the Secured Party deems necessary to receive its
mail, including notifying the post office authorities to change the address for
delivery of its mail to such address as the Secured Party may designate; and
(iii) notify any or all Account Debtors that the Accounts have been assigned to
the Secured Party for the benefit of the Lenders and that the Secured Party has
a security interest therein for the benefit of the Lenders and to send requests
for verification of Accounts to Account Debtors and to request from Account
Debtors in such Borrower's name or Secured Party's name or that of Secured
Party's designee, any information concerning the Accounts and the amounts owing
thereon. The Secured Party shall promptly, but in no event more than two
Business Days, furnish such Borrower with a copy of any such notice sent and
such Borrower hereby agrees that any such notice, in the Secured Party's sole
discretion, may be sent on the stationery of such Borrower, in which event such
Borrower shall co-sign such notice with the Secured Party.
6. Covenants. Each Borrower covenants that:
(A) Inspection. The Secured Party (by any of its officers,
employees and agents) shall have the right, at any time or times during
each Borrower's usual business hours upon reasonable prior notice at
reasonable intervals, to inspect the Collateral belonging to such
Borrower, all records related thereto (and to make extracts or copies
from such records), and the premises upon which any of the Collateral
is located, to discuss each Borrower's affairs and finances with any
officer of such Borrower and to verify the amount, quality, quantity,
value and condition of, or any other matter relating to, the
Collateral. Upon or after the occurrence and during the continuation of
an Event of Default (as defined in Section 12 hereof) (whether or not
any or all the Obligations are accelerated in consequence thereof), the
Secured Party may at any time and from time to time employ and maintain
on any of any Borrower's premises a custodian selected by the Secured
Party who shall have full authority to do all acts reasonably necessary
to protect the interest of the Secured Party and the Lenders. All
expenses incurred by the Secured Party by reason of the employment of
such custodian shall be paid by the Borrowers, added to the Obligations
and secured by the Collateral.
(B) Assignments, Records and Schedules of Accounts. Each
Borrower shall keep accurate and complete records of its Accounts
("Account Records") in accordance with GAAP and from time to time at
intervals reasonably designated by the Secured Party, it shall provide
the Secured Party with a Schedule of Accounts in form and substance
acceptable to the Secured Party describing all Accounts created or
acquired by it ("Schedule of Accounts"); provided, however, that any
Borrower's failure to execute and deliver any such Schedule of Accounts
shall not affect or limit the Secured Party's security interest or
other rights in and to any Accounts. Upon request, each Borrower shall
furnish the Secured Party with copies of proof of shipment and delivery
and copies of all documents, including, without limitation, copies of
invoices, repayment histories and present status reports, relating to
the Accounts so scheduled (collectively, "Accounts Documents") and such
other matters and information relating to the status of then existing
Accounts as the Secured Party shall reasonably request. No Borrower
shall remove any Accounts Records or Accounts Documents from the
locations set forth on Schedule 1 hereto.
(C) Notice Regarding Disputed Accounts. In the event of a
dispute involving an amount due and owing in excess of $500,000 between
any Account Debtor and any Borrower (which shall include, without
limitation, any dispute in which an offset claim or counterclaim may
result), such Borrower shall promptly, but in no event later than ten
(10) Business Days, provide the Secured Party with written notice
thereof explaining in detail the reason for the dispute, all claims
related thereto and the amount in controversy.
(D) Verification of Accounts. Whether or not an Event of
Default has occurred, any of the Secured Party's officers, employees,
or agents shall have the right, at any time or times hereafter, to
verify the validity, amount or any other matter relating to any
Accounts by mail, telephone, telegraph or otherwise; provided, however,
that prior to an Event of Default (a) the applicable Borrower shall be
furnished the form of any verification request prior to the use thereof
and (b) the number of verifications requested shall not exceed the
number necessary for a reasonable sampling consistent with prudent
audit procedures.
(E) Sale of Inventory. So long as no Event of Default has
occurred and is continuing, each Borrower may sell its Inventory in the
ordinary course of business.
(F) Safekeeping of Inventory. Each Borrower shall be
responsible for the safekeeping of its Inventory, and in no event shall
the Secured Party have any responsibility for:
(i) Any loss or damage to Inventory or destruction
thereof occurring or arising in any manner or fashion from any
cause (except if the Secured Party has taken possession of or
otherwise has control of Inventory and then such loss or
damage is a result of Secured Party's gross negligence or
willful misconduct);
(ii) Any diminution in the value of Inventory; or
(iii) Any act or default of any carrier,
warehouseman, bailee or forwarding agency thereof or other
Person in any way dealing with or handling Inventory.
(G) Records and Schedules of Inventory. Each Borrower shall
keep correct and accurate records, itemizing and describing the kind,
type, location, quality and quantity of Inventory owned by it from time
to time, and such Borrower's cost therefor and selling price thereof,
and shall furnish to the Secured Party upon request from time to time
at reasonable intervals designated by the Secured Party a current
Schedule of Inventory ("Schedule of Inventory") based upon its most
recent physical inventory and records. Each Borrower shall promptly
advise the Secured Party in sufficient detail of any material adverse
change relating to the type, quality or quantity of the Inventory. Each
Borrower shall conduct a physical inventory, of which the Secured Party
shall be given prior written notice and shall have the right to be
present, no less frequently than required by the Borrowers' outside
auditors, and upon the occurrence and during the continuation of an
Event of Default more often if requested by the Secured Party, and
shall furnish to the Secured Party such other documents and reports as
the Secured Party shall request with respect to the Inventory,
including, without limitation, invoices relating to such Borrower's
purchase of Inventory. No Borrower shall move any of the Inventory
owned by such Borrower from, or keep any Inventory owned by such
Borrower at, any location other than the locations set forth for each
such Borrower on Schedule 2 or Schedule 3 hereto (each location with
respect to such Borrower is hereinafter referred to as such Borrower's
"Principal Location"), except that (i) each Borrower may move Inventory
to, or keep Inventory at, any location other than its Principal
Location (each such other location a "Remote Location" and inventory
kept at a Remote Location being "Remote Inventory") provided that (x)
after giving effect thereto, Remote Inventory of all Borrowers at any
same Remote Location does not exceed $100,000 in the aggregate cost
therefor and Remote Inventory of all Borrowers at all Remote Locations
does not exceed $500,000 in aggregate cost therefor, and (y) if any
Remote Location is not set forth on Schedule 2 or Schedule 3 hereto,
prior to moving Inventory to any such Remote Location, the Borrowers
shall have provided prior written notice thereof to the Secured Party
and shall have furnished the Secured Party with executed Financing
Statements acceptable in form and content to the Secured Party with
respect to such Inventory; and (ii) any Borrower may move Inventory
upon receipt of the written consent of the Secured Party.
(H) Location, Records and Schedules of Equipment. Keystone
shall maintain accurate, itemized records itemizing and describing the
kind, type, quality, quantity and net book value of its Equipment and
shall furnish the Secured Party upon request with a current schedule
containing the foregoing information. Except for dispositions of
Equipment as permitted under Section 9.8 of the Credit Agreement,
Keystone shall not remove any of the Equipment from the location set
forth in Schedule 4 hereto without at least 30 days' prior written
notice to the Secured Party as provided in Section 18 hereof and
delivery to the Secured Party by Keystone prior to such removal of
executed financing statements, amendments and other documents necessary
to maintain the security interests granted hereunder.
(I) Sale or Mortgage of Equipment. Except as permitted by the
Credit Agreement prior to the occurrence and continuance of an Event of
Default, Keystone shall not sell, exchange, lease, mortgage, encumber,
pledge or otherwise dispose of or transfer any of the Equipment or any
part thereof without the prior written consent of the Secured Party.
(J) Maintenance of Equipment. Keystone shall keep and maintain
its Equipment in good operating condition and repair, ordinary wear and
tear excepted. Keystone shall not permit any such items to become a
fixture to real property (unless Keystone has granted the Secured Party
for the benefit of the Lenders a lien on such real property) or
accessions to other personal property.
(K) Payment of Taxes and Assessments. Each Borrower will
promptly pay, when due, all taxes or assessments levied against any of
the Collateral; provided, however, such Borrower shall not be required
to pay or cause to be paid any such tax or assessment, so long as the
validity thereof shall be actively contested in good faith by proper
proceedings diligently conducted, any Lien (other than statutory liens
having priority as a matter of law) arising in connection therewith
shall be and remain in all respects inferior to the liens in favor of
the Secured Party for the benefit of the Lenders, and adequate reserves
with respect thereto shall be established and maintained; but provided
further that any such tax or assessment shall be paid forthwith upon
the commencement of proceedings to foreclose any lien securing the
same.
7. General Warranties Regarding Collateral. Each Borrower hereby
warrants and represents to the Secured Party that it is and will continue to be
the owner of the Collateral located on the locations identified beneath its name
on Schedules 1, 2, 3 and 4 hereto, free and clear of all Liens other than the
security interest granted hereunder in favor of the Secured Party for the
benefit of the Lenders and the Liens permitted by Section 9.6 of the Credit
Agreement, and that it will defend the Collateral and any products and proceeds
thereof against all claims and demands of all Persons at any time claiming the
same or any interest therein adverse to the Secured Party and the Lenders.
Except as so designated on Schedule 2 hereto, none of the Collateral is located
on leased property.
8. Accounts Warranties and Representations. Each Borrower warrants and
represents to the Secured Party that it may rely on all written statements or
representations made by such Borrower on or with respect to the Accounts or any
Schedule of Accounts prepared and delivered by such Borrower and, unless
otherwise indicated in writing by such Borrower, that:
(A) All Account Records and Account Documents are located and
shall be kept only at such Borrower's principal place of business and
chief executive office as set forth in Schedule 1 attached hereto and
incorporated herein by reference;
(B) The Accounts are genuine, are in all respects what they
purport to be, are not evidenced by a judgment, instrument or document
(other than an invoice or purchase order) or, if evidenced by such
instrument or document, are only evidenced by one original instrument
or document, which has been delivered to the Secured Party;
(C) The Accounts cover bona fide sales and deliveries of
Inventory usually dealt in by such Borrower, or the rendition by such
Borrower of services, to an Account Debtor in the ordinary course of
business;
(D) The amounts of the face value of the Accounts shown on any
Schedule of Accounts provided to the Secured Party, and all invoices
and statements delivered to the Secured Party with respect to any
Accounts, are actually and absolutely owing to such Borrower and are
not contingent for any reason except for claims arising as a result of
warranties made by Borrower in its ordinary course of business which do
not in the aggregate materially affect such Borrower's business,
profits or condition, financial and otherwise;
(E) There are no material setoffs, discounts, allowances,
claims, counterclaims or disputes of any kind existing or asserted with
respect to the Accounts, other than customary discounts and allowances
granted in the ordinary course of such Borrower's business, and such
Borrower has not made any agreement with any Account Debtor thereunder
for any deduction therefrom;
(F) To the best of such Borrower's actual knowledge, (i) the
Accounts represent valid and legally enforceable indebtedness according
to their terms and (ii) there are no facts, events, or occurrences
which in any way materially impair the validity or enforcement thereof
or tend to reduce the amount payable thereunder from the amount of the
invoice face value shown on any Schedule of Accounts, and on all
contracts, invoices and statements delivered to the Secured Party with
respect thereto;
(G) To the best of such Borrower's actual knowledge, all
Account Debtors (i) had the capacity to contract at the time any
contract or other document giving rise to the Accounts was executed and
(ii) were reasonably expected to be able to pay at the time any
contract was executed all Accounts under such contract.
(H) The goods or services giving rise thereto are not, and
were not at the time of the sale or performance thereof, subject to any
Lien, except Liens permitted by Section 9.6 of the Credit Agreement,
those granted to the Secured Party hereunder and those removed or
terminated prior to the date hereof;
(I) The Accounts have not been pledged to any Person other
than to the Secured Party, and will be owned by the Borrower free and
clear of any Liens, except those in favor of the Secured Party or as
permitted by Section 9.6 of the Credit Agreement;
(J) The Secured Party's security interest in the Accounts,
will not be subject to any offset, deduction, counterclaim, lien or
other adverse condition;
(K) None of the Accounts shall represent a delivery of goods
upon "consignment," "guaranteed sale," "sale or return transactions," "payment
on reorder" or similar terms and will not be subject to any prohibition
or limitation upon assignment.
9. Inventory Warranties and Representations. With respect to
Inventory, each Borrower warrants and represents to the Secured Party that it
may rely on all written statements or representations made by such Borrower
on or with respect to any Inventory and, unless otherwise indicated in writing
by such Borrower, that:
(A) All Inventory of such Borrower is located only at the
locations listed beneath its name on Schedules 2 and 3 attached hereto
and incorporated herein by reference (each an "Inventory Location"), or
is Inventory in transit;
(B) No Inventory of such Borrower is or will be subject to any
Lien whatsoever, except for the security interest granted to the
Secured Party hereunder and Liens permitted by Section 9.6 of the
Credit Agreement, and notwithstanding such exception all statutory
liens of warehousemen, bailees, lessors or similar parties at either
Principal Location shall be waived or subordinated in form and
substance acceptable to the Secured Party to the security interest
granted to the Secured Party hereunder;
(C) No Inventory of an aggregate cost in excess of $250,000 is
now either located on Leased Premises, or stored with a bailee,
warehouseman, or similar party other than Inventory of Solite
Corporation stored at the facility located in Green Cove Springs,
Florida owned by Stoneridge Farms, Inc. with respect to which Solite
Corporation has entered into a lease arrangement with Stoneridge Farms,
Inc. and Stoneridge Farms, Inc. has waived its rights with respect to
such Inventory in form and substance acceptable to the Secured Party;
all present locations of Inventory at leased premises are set forth on
Schedule 2 hereto and all present locations of Inventory so stored with
a bailee, warehousemen or similar party are set forth on Schedule 3
hereto; and
(D) No Inventory of such Borrower is under consignment to any
Person.
10. Equipment Representations and Warranties. With respect to its
Equipment, Keystone warrants and represents to the Secured Party that it may
rely on all statements or representations made by Keystone on or with respect to
any Equipment and that:
(A) All Equipment is located only at the location set
forth in Schedule 4 hereto;
(B) None of its Equipment is or will be subject to any Lien,
claim, encumbrance or security interest whatsoever, except for the
security interest of the Secured Party hereunder Liens permitted by
Section 9.6 of the Credit Agreement, and notwithstanding such exception
all statutory liens of warehousemen, bailees, lessors or similar
parties with respect to the Equipment shall be waived or subordinated
in form and substance acceptable to the Secured Party to the security
interest granted to the Secured Party hereunder;
(C) No Equipment is at or shall be kept at any location that
is leased by Keystone from any other Person unless the lessor waives
its rights with respect to such Equipment in form and substance
acceptable to the Secured Party.
11. Casualty and Liability Insurance Required.
(A) Each Borrower will keep the Collateral continuously
insured against such risks as are customarily insured against by
businesses of like size and type engaged in the same or similar
operations including, without limiting the generality of any other
covenant herein contained:
(i) casualty insurance on the Inventory in an
amount not less than the full insurable value thereof, against
loss or damage by theft, fire and lightning and other hazards
ordinarily included under uniform broad form standard extended
coverage policies, limited only as may be provided in the
standard broad form of extended coverage endorsement at the
time in use in the states in which the Collateral is located;
(ii) comprehensive general liability insurance
against claims for bodily injury, death or property damage
occurring with or about such Collateral (such coverage to
include provisions waiving subrogation against the Secured
Party and the Lenders) in amounts as shall be reasonably
satisfactory to Agent;
(iii) liability insurance with respect to the
operation of its facilities under the workers' compensation
laws of the states in which such Collateral is located; and
(iv) business interruption insurance.
(B) Each insurance policy obtained in satisfaction of the
requirements of Section 11(A) hereof:
(i) may be provided by blanket policies now or
hereafter maintained by each Borrower or its parent companies;
(ii) shall be issued by such insurer (or insurers)
as shall be financially responsible and of recognized
standing;
(iii) shall be in such form and have such provisions
(including without limitation the loss payable clause, the
waiver of subrogation clause, the deductible amount, if any,
and the standard mortgagee endorsement clause), as are
generally considered standard provisions for the type of
insurance involved and are reasonably acceptable in all
respects to the Agent;
(iv) shall prohibit cancellation or substantial
modification, termination or lapse in coverage by the insurer
without at least 30 days' prior written notice to the Agent,
except for non-payment of premium, in which case such policies
shall provide ten (10) days' prior written notice;
(v) without limiting the generality of the
foregoing, all insurance policies where applicable under
Section 11(A)(i) carried on the Collateral shall name the
Agent, for the benefit of the Lenders, as loss payee and a
party insured thereunder in respect of any claim for payment
in excess of $250,000.
(C) Prior to expiration of any such policy, such Borrower
shall furnish the Agent with evidence satisfactory to the Agent that
the policy or certificate has been renewed or replaced or is no longer
required by this Agreement.
(D) Each Borrower hereby irrevocably makes, constitutes and
appoints the Agent (and all officers, employees or agents designated by
the Agent), for the benefit of the Lenders, effective upon the
occurrence and during the continuance of an Event of Default, as such
Borrower's true and lawful attorney (and agent-in-fact) for the purpose
of making, settling and adjusting claims under such policies of
insurance, endorsing the name of such Borrower on any check, draft,
instrument or other item or payment for the proceeds of such policies
of insurance and for making all determinations and decisions with
respect to such policies of insurance.
(E) In the event such Borrower shall fail to maintain, or fail
to cause to be maintained, the full insurance coverage required
hereunder or shall fail to keep any of its Collateral in good repair
and good operating condition, the Agent may (but shall be under no
obligation to), without waiving or releasing any Obligation or Event of
Default by such Borrower hereunder, contract for the required policies
of insurance and pay the premiums on the same or make any required
repairs, renewals and replacements; and all sums so disbursed by Agent,
including reasonable attorneys' fees, court costs, expenses and other
charges related thereto, shall be payable on demand by such Borrower to
the Agent and shall be additional Obligations secured by the
Collateral.
(F) Each Borrower agrees that to the extent that it shall not
carry insurance required by Section 11(A) hereof, it shall in the event
of any loss or casualty pay promptly to the Agent, for the benefit of
the Lenders, for application in accordance with the provisions of
Section 11(H) hereof, such amount as would have been received as Net
Proceeds (as hereinafter defined) by the Agent, for the benefit of the
Lenders, under the provisions of Section 11(H) hereof had such
insurance been carried to the extent required.
(G) The Net Proceeds of the insurance carried pursuant to the
provisions of Sections 11(A)(ii) and 11(A)(iii) hereof shall be applied
by such Borrower toward extinguishment of the defect or claim or
satisfaction of the liability with respect to which such insurance
proceeds may be paid.
(H) The Net Proceeds of the insurance carried with respect to
the Collateral pursuant to the provisions of Section 11(A)(i) hereof
shall be paid to such Borrower and held by such Borrower in a separate
account and applied as follows: (i) as long as no Event of Default
shall have occurred and be continuing, after any loss under any such
insurance and payment of the proceeds of such insurance, each Borrower
shall have a period of 180 days after payment of the insurance proceeds
with respect to such loss to elect to either (x) repair or replace the
Collateral so damaged, (y) deliver such Net Proceeds to the Agent, for
the benefit of the Lenders, as additional Collateral or (z) apply such
Net Proceeds to the acquisition of tangible assets used or useful in
the conduct of the business of such Borrower, subject to the provisions
of this Agreement. If such Borrower elects to repair or replace the
Collateral so damaged, such Borrower agrees the Collateral shall be
repaired to a condition substantially similar to its condition prior to
damage or replaced with Collateral in a condition substantially similar
to the condition of the Collateral so replaced prior to damage; and
(ii) at all times during which an Event of Default shall have occurred
and be continuing, after any loss under such insurance and payment of
the proceeds of such insurance, such Borrower shall immediately deliver
such Net Proceeds to such Agent, for the benefit of the Lenders, as
additional Collateral.
(I) "Net Proceeds" when used with respect to any insurance
proceeds shall mean the gross proceeds from such proceeds, award or
other amount, less all taxes, fees and expenses (including attorneys'
fees) incurred in the realization thereof.
(J) In case of any material damage to or destruction of all or
any material part of the Collateral pledged hereunder by a Borrower,
such Borrower shall give prompt notice thereof to the Agent. Each such
notice shall describe generally the nature and extent of such damage,
destruction, taking, loss, proceeding or negotiations. Each Borrower is
hereby authorized and empowered to adjust or compromise any loss under
any such insurance.
12. Events of Default. The following shall constitute Events of
Default ("Events of Default")under this Security Agreement:
(A) The occurrence of an Event of Default under the Credit
Agreement; or
(B) Failure by any Borrower to perform, observe or comply with
any term, covenant, condition or provision contained in this Security
Agreement and in each event other than such failure to perform, observe
and comply with the last sentence of Section 7(G) hereof, such failure
shall continue for 30 or more days after the earlier of receipt of
notice of such failure by the Secured Party or any senior officer of
such Borrower becomes aware of such failure; or
(C) Any material warranty, representation or other written
statement made by any Borrower herein or in any instrument furnished by
such Borrower to the Secured Party pursuant to this Security Agreement
shall be false or misleading in any material respect on the date as of
which it is made.
13. Rights and Remedies Upon Event of Default. During the
occurrence and continuation of an Event of Default, the Secured Party shall have
the following rights and remedies:
(A) All of the rights and remedies of a secured party under
the Uniform Commercial Code of the state where such rights and remedies
are asserted, or under other applicable law, all of which rights and
remedies shall be cumulative, and none of which shall be exclusive, to
the extent permitted by law, in addition to any other rights and
remedies contained in this Security Agreement, the Credit Agreement or
any other Loan Documents;
(B) The right, to the extent permitted by law, to enter upon
the premises of any Borrower through self-help and without judicial
process, without first obtaining a final judgment or giving any
Borrower notice and opportunity for a hearing on the validity of the
Secured Party's claim and without any obligation to pay rent to any
Borrower, or any other place or places where any Collateral is located
and kept, and remove the Collateral therefrom to the premises of the
Secured Party or any agent of the Secured Party, for such time as the
Secured Party may desire, in order effectively to collect or to
liquidate the Collateral;
(C) The right to (i) demand payment of the Accounts; (ii)
enforce payment of the Accounts, by legal proceedings or as otherwise
provided herein; (iii) exercise all of the Borrowers' rights and
remedies with respect to the collection of the Accounts; (iv) settle,
adjust, compromise, extend or renew the Accounts; (v) settle, adjust or
compromise any legal proceedings brought to collect the Accounts; (vi)
if permitted by applicable law, sell or assign the Accounts upon such
terms, for such amounts and at such time or times as the Secured Party
deems advisable; (vii) discharge and release the Account Debtors or
extend the time of payment of any and all Accounts or to make
allowances or adjustments relating thereto; (viii) if any Borrower
fails to promptly do so, prepare, file and sign such Borrower's name on
a Proof of Claim in bankruptcy or similar document against any Account
Debtor; (ix) prepare, file and sign any Borrower's names on any notice
of lien, notice of assignment, financing statements, assignment or
satisfaction of lien or similar document in connection with the
Accounts; (x) endorse the name of any Borrower upon any chattel paper,
document, instrument, invoice, freight xxxx, xxxx of lading or similar
document or notices to Account Debtors or agreement relating to the
Accounts or Inventory; (xi) use any Borrower's stationery for
verifications of the Accounts and notices thereof to Account Debtors;
(xii) use the information recorded on or contained in any data
processing equipment and computer hardware and software relating to the
Accounts and Inventory to which any Borrower has access; (xiii) open
any Borrower's mail and collect any and all amounts due to it from
persons obligated and any Accounts; (xiv) take over any Borrower's post
office boxes or make other arrangements as the Secured Party deems
necessary to receive its mail including notifying the post office
authorities to change the address for delivery of its mail to such
address as the Secured Party may designate; and (xv) do all acts and
things and execute all documents necessary, in the Secured Party's
discretion, to collect the Accounts;
(D) Upon ten (10) days notice to the Authorized
Representative, the right to sell (or to direct any Borrower to sell as
agent of the Secured Party), assign, lease or otherwise to dispose of
all or any Collateral in its then condition, or after any repairs or
refurbishing shall have been made, at public or private sale or sales,
with such notice as may be required by law, in lots or in bulk, for
cash or on credit, with or without representations and warranties, at
any time or place, in one or more sales all as the Secured Party, in
its sole discretion, may deem advisable. The Secured Party shall have
the right to conduct such sales on any Borrower's premises or elsewhere
and shall have the right to use any Borrower's premises without charge
for such sales for such time or times as the Secured Party may see fit.
The Secured Party may, if it deems it reasonable, postpone or adjourn
any sale of the Collateral from time to time by an announcement at the
time and place of such postponed or adjourned sale, without being
required to give a new notice of sale. Each Borrower agrees that the
Secured Party has no obligation to preserve rights to the Collateral
against prior parties or to xxxxxxxx any Collateral for the benefit of
any Person. If any of the Collateral shall require repairs,
maintenance, preparation or the like, the Secured Party shall have the
right, but shall not be obligated, to perform such repairs,
maintenance, preparation or other processing for the purpose of putting
the same in such saleable form as the Secured Party shall deem
appropriate, but the Secured Party shall have the right to sell or
dispose of the Collateral without such processing. Each Borrower agrees
that in the event notice is necessary under applicable law, written
notice mailed to an Authorized Representative in the manner specified
in Section 19 hereof ten (10) days prior to the date of public sale of
any of the Collateral or prior to the date after which any private sale
or other intended disposition of the Collateral will be made shall
constitute commercially reasonable notice to such Borrower of such sale
or other disposition. All notice is hereby waived with respect to any
of the Collateral which the Secured Party has reason to believe will
decline speedily in value. The Secured Party may purchase all or any
part of the Collateral at public or, if permitted by law, private sale,
free from any right of redemption which is hereby expressly waived by
each Borrower and, in lieu of actual payment of such purchase price,
may set off the amount of such price against the Obligations. The net
cash proceeds resulting from the collection, liquidation, sale, lease
or other disposition of the Collateral shall be applied in accordance
with Section 16 hereof. Each Borrower shall be liable to the Secured
Party and shall pay to the Secured Party on demand any deficiency with
respect to the Obligations which may remain after such sale,
disposition, collection or liquidation of the Collateral. The Secured
Party shall remit to Giant Holding or the Person entitled thereto any
surplus of such cash proceeds remaining after all Obligations have been
paid in full.
14. Anti-Marshalling Provisions. The right is hereby given by each
Borrower to the Secured Party to make releases (whether in whole or in part) of
all or any part of the Collateral agreeable to the Secured Party without notice
to, or the consent, approval or agreement of other parties and interests,
including junior lienors, which releases shall not impair in any manner the
validity of or priority of the liens and security interest in the remaining
Collateral conferred under such documents, nor release any Borrower from
liability for the Obligations hereby secured. Notwithstanding the existence of
any other security interest in the Collateral held, the Secured Party shall have
the right to determine the order in which any or all of the Collateral shall be
subjected to the remedies provided in this Security Agreement. Each Borrower
hereby waives any and all right to require the marshalling of assets in
connection with the exercise of any of the remedies permitted by applicable law
or provided herein.
15. Appointment of the Secured Party as Borrowers' Lawful Attorney.
During the continuance of an Event of Default, each Borrower irrevocably
designates, makes, constitutes and appoints the Secured Party (and all Persons
designated by the Secured Party) as its true and lawful attorney (and
agent-in-fact) for the purposes specified herein. All acts of the Secured Party
or its designee taken pursuant to Section 13 are hereby ratified and confirmed
and the Secured Party or its designee shall not be liable for any acts of
omission or commission nor for any error of judgment or mistake of fact or law
except to the extent that the Secured Party or its designee engages in gross
negligence, wilful misconduct or a wilful default or wilful breach under this
Agreement or any other Loan Document. This power, being coupled with an
interest, is irrevocable by the Borrowers until all Obligations are paid in
full.
16. Application of Proceeds. All monies collected by the Secured Party
upon any sale or other disposition of the Collateral, together with all other
monies received by the Secured Party hereunder in respect of the Collateral,
shall be applied as provided in Section 10.5 of the Credit Agreement.
17. Expenses; Indemnity. The Borrowers will upon demand jointly and
severally pay the Secured Party the amount of any and all reasonable expenses,
including the reasonable fees and expenses of its counsel and of any experts and
agents, which it may reasonably incur in connection with (a) the execution of
the terms of this Security Agreement, (b) the custody or preservation of, or the
sale of, collection from, or other realization upon any of the Collateral
hereunder or (c) the failure by any Borrower to perform or to observe any of the
provisions hereof. Each Borrower agrees jointly and severally to indemnify and
hold harmless the Secured Party and each Lender from and against any and all
claims and demands, losses, judgments and liabilities (including liabilities for
penalties) of whatever kind or nature, growing out of or arising from this
Security Agreement or the exercise by the Secured Party of any right or remedy
granted to it hereunder or under the Credit Agreement or any other Loan
Document, other than any such claim, demand, loss, judgment or liability
resulting from the gross negligence or wilful misconduct of the Secured Party.
If and to the extent that the obligations of the Borrowers under this Section 17
are unenforceable for any reason, each Borrower hereby agrees to make the
maximum contribution to the payment and satisfaction of such obligations which
is permissible under applicable law.
18. Security Interest Absolute. All rights of the Secured Party
hereunder, and all obligations of each Borrower hereunder, shall be absolute
and unconditional irrespective of:
(A) any lack of validity or enforceability of the Credit
Agreement, any other Loan Document or any other agreement or instrument
relating to any of the Obligations;
(B) any change in the term, manner or place of payment of, or
in any other term of, all or any of the Obligations, or any other
amendment or waiver of or any consent to any departure from the Credit
Agreement, any other Loan Document or any other agreement or instrument
relating to any of the Obligations;
(C) any exchange, release or non-perfection of any other
collateral, or any release or amendment or waiver of or consent to
departure from any guaranty, for all or any of the Obligations; or
(D) any other circumstances (other than circumstances
resulting from the gross negligence or wilful misconduct of the Secured
Party) which might otherwise constitute a defense available to, or a
discharge of, any Borrower in respect of the Obligations or of this
Security Agreement.
17. Amendments, Waivers and Consents. No amendment or waiver of any
provision of this Security Agreement or consent to any departure of any Borrower
herefrom shall in any event be effective unless the same shall be in writing and
signed by each Borrower and the Secured Party with the consent of the Required
Lenders and then such amendment, waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given. No failure
on the part of the Secured Party to exercise, and no delay in exercising, any
rights, power or remedy hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right, power or remedy by the Secured
Party preclude any other or further exercise thereof or the exercise of any
other right, power or remedy.
18. Notices. Any notice shall be conclusively deemed to have been
received by any party hereto and be effective on the day on which delivered to
such party (against receipt therefor) at the address set forth below or such
other address as such party shall specify to the other parties in writing (or,
in the case of notice by telecopy, telegram or telex (where the receipt of such
message is verified by return) expressly provided for hereunder, when received
at such telecopy or telex number as may from time to time be specified in
written notice to the other parties hereto or otherwise received), or if sent
prepaid by certified or registered mail return receipt requested on the fifth
Business Day after the day on which mailed, addressed to such party at said
address:
(A) if to any of the Borrowers:
Giant Cement Holding, Inc.
000-X Xxxxxxx Xxxxxxx
Xxxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
Vice President and
Chief Financial Officer
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
with a copy to:
Keystone Cement Company
Xxxx Xxxxxx Xxx X
Xxxx, Xxxxxxxxxxxx 00000-0000
Attention: Xxxx X. Xxxxxxx
President and CEO
Telephone: (000)000-0000
Telefacsimile: (000) 000-0000
(B) if to the Secured Party:
SouthTrust Bank, National Association
000 Xxxx XxXxx Xxxxxx
Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxx Xxxx
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
with a copy to:
SouthTrust Bank, National Association
0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxx Xxxxxxx
Telephone: (000) 000-0000
Telefacsimile: (000) 000-0000
19. Termination. This Security Agreement shall terminate when all the
Obligations have been fully paid, satisfied and performed, or otherwise
satisfied or provided for to the satisfaction of the Secured Party, and the
Credit Agreement shall have been terminated at which time the Secured Party
shall promptly release all of the Collateral from the security interest granted
hereunder and take all action reasonably necessary to effectuate the same.
Notwithstanding the foregoing provisions of this Section 21, in the event that
any payment made or deemed made to the Secured Party in payment of any
Obligation shall be rescinded or declared to be or become void, voidable or
otherwise recoverable from the Secured Party for any reason whatsoever, the Lien
in favor of the Secured Party created hereunder shall be and become reinstituted
in respect of such Obligations until the same shall be thereafter fully and
finally paid, satisfied and discharged.
20. Interpretation; Partial Invalidity. Whenever possible each
provision of this Security Agreement shall be interpreted in such manner as to
be effective and valid under applicable law, but if any provision of this
Security Agreement shall be prohibited by or invalid under such law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining provisions
of this Security Agreement.
21. Miscellaneous; Remedies Cumulative. Unless the context of this
Security Agreement otherwise clearly requires, references to the plural includes
the singular, the singular the plural and the part the whole and "or" has the
inclusive meaning represented by the phrase "and/or". The section headings used
herein are for convenience of reference only and shall not define, limit or
extend the provisions of this Security Agreement. All remedies hereunder are
cumulative and are not exclusive of any other rights and remedies of the Secured
Party provided by law or under the Credit Agreement, the Loan Documents, or
other applicable agreements or instruments. The making of the Loans to the
Borrowers pursuant to the Credit Agreement shall be conclusively presumed to
have been made or extended, respectively, in reliance upon the obligations of
the Borrower incurred pursuant to this Security Agreement.
22. Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of the Secured Party and each Borrower, and the right,
remedies, powers, and privileges of the Secured Party hereunder shall inure to
the benefit of the successors and assigns of the Secured Party; provided,
however, that (i) no Borrower shall make any assignment hereof without the prior
written consent of the Secured Party and (ii) the Secured Party may make
assignments in compliance with Section 12.1 of the Credit Agreement.
23. Counterparts. This Agreement may be executed in any number of
counterparts and all the counterparts taken together shall be deemed to
constitute one and the same instrument.
24. Governing Law.
(A) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF SOUTH CAROLINA APPLICABLE TO
CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
(B) EACH BORROWER HEREBY EXPRESSLY AND IRREVOCABLY AGREES AND
CONSENTS THAT ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREIN MAY BE
INSTITUTED IN ANY STATE OR FEDERAL COURT SITTING IN THE COUNTY OF
MECKLENBURG OF NORTH CAROLINA, UNITED STATES OF AMERICA AND, BY THE
EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH BORROWER EXPRESSLY
WAIVES ANY OBJECTION THAT IT MAY HAVE NOW OR HEREAFTER TO THE LAYING OF
THE VENUE OR TO THE JURISDICTION OF ANY SUCH SUIT, ACTION OR
PROCEEDING, AND IRREVOCABLY SUBMITS GENERALLY AND UNCONDITIONALLY TO
THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR
PROCEEDING.
(C) EACH BORROWER AGREES THAT SERVICE OF PROCESS MAY BE MADE
BY PERSONAL SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT OR OTHER
LEGAL PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING, OR BY REGISTERED
OR CERTIFIED MAIL (POSTAGE PREPAID) TO THE ADDRESS OF SUCH BORROWER
PROVIDED IN THE CREDIT AGREEMENT, OR BY ANY OTHER METHOD OF SERVICE
PROVIDED FOR UNDER THE APPLICABLE LAWS IN EFFECT IN THE STATE OF NORTH
CAROLINA.
(D) NOTHING CONTAINED IN SUBSECTIONS (B) OR (C) HEREOF SHALL
PRECLUDE THE SECURED PARTY FROM BRINGING ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE OTHER LOAN
DOCUMENTS IN THE COURTS OF ANY PLACE WHERE ANY BORROWER OR ANY OF SUCH
BORROWER'S PROPERTY OR ASSETS MAY BE FOUND OR LOCATED. TO THE EXTENT
PERMITTED BY THE APPLICABLE LAWS OF ANY SUCH JURISDICTION, EACH
BORROWER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH
COURT AND EXPRESSLY WAIVES, IN RESPECT OF ANY SUCH SUIT, ACTION OR
PROCEEDING, THE JURISDICTION OF ANY OTHER COURT OR COURTS WHICH NOW OR
HEREAFTER, BY REASON OF ITS PRESENT OR FUTURE DOMICILE, OR OTHERWISE,
MAY BE AVAILABLE TO IT.
(E) IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY
RIGHTS OR REMEDIES UNDER OR RELATED TO THIS AGREEMENT OR ANY AMENDMENT,
INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR THAT MAY IN THE FUTURE
BE DELIVERED IN CONNECTION WITH THE FOREGOING, EACH BORROWER HEREBY
AGREES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, THAT ANY SUCH ACTION
OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY AND
EACH BORROWER HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW,
ANY OBJECTION THAT IT MAY HAVE THAT EACH ACTION OR PROCEEDING HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM.
[Signature pages follow]
IN WITNESS WHEREOF, the Borrowers and the Secured Party have caused
this Security Agreement to be duly executed by delivered by its respective
officer thereunto duly authorized as of the date first above written.
GIANT CEMENT HOLDING, INC.
GIANT CEMENT COMPANY
KEYSTONE CEMENT COMPANY
GIANT RESOURCE RECOVERY COMPANY, INC.
GCHI INVESTMENTS, INC.
GIANT CEMENT NC, INC.
SOLITE CORPORATION
EDEN MACHINE AND DESIGN CORPORATION
CAROLINA SOLITE CORPORATION
SOLITE LIGHTWEIGHT TRANSPORTATION, INC.
OLDOVER TOO, INC.
OLDOVER CORPORATION
M&M CHEMICAL & EQUIPMENT CO., INC.
CHARLOTTE BLOCK, INC.
LIGHTWEIGHT BLOCK-EDEN CORPORATION
LIGHTWEIGHT BLOCK COMPANY, INCORPORATED
BOSTON CONCRETE PRODUCTS, INCORPORATED
LIGHTWEIGHT BLOCK LEXINGTON CORPORATION
ATTEST: By:______________________________________
Name: Xxxxx X. Xxxxxx
______________________ Title: Vice President
Xxxxxx X. Xxxx,
Assistant Secretary
[CORPORATE SEAL]
SOUTHTRUST BANK, NATIONAL ASSOCIATION,
as Agent for the Lenders
By:
Name: Xxxx X. Xxxxxxx
Title: Vice President
SOUTHTRUST BANK, NATIONAL ASSOCIATION,
as Lender
By:
Name: Xxxx X. Xxxxxxx
Title: Vice President
