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Exhibit 4.3
CREDIT AGREEMENT
Dated as of October 5, 2000
Among
THE FINANCIAL INSTITUTIONS NAMED HEREIN
as the Lenders
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and
BANK OF AMERICA, N.A.
as the Administrative Agent
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and
NATIONAL CITY BANK
as the Co-Administrative Agent
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and
UNIFRAX CORPORATION
and the other corporations named herein
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as the Borrowers
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MULTI BANCO, S.A.
as the Brazil Lender, solely for the purposes of Section 1.4(a)
NAF BRAZIL LTDA.
as Unifrax Brazil, solely for the purposes of Section 1.4(a)
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TABLE OF CONTENTS
Section Page
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ARTICLE 1 LOANS AND LETTERS OF CREDIT.............................................................................2
1.1 Total Facility..................................................................................2
1.2 Revolving Loans.................................................................................2
1.3 Term Credit Facilities..........................................................................6
1.4 Brazilian Letter of Credit.....................................................................11
1.5 Other Letters of Credit........................................................................14
1.6 Participations in Brazilian Letter of Credit...................................................18
1.7 Bank Products..................................................................................20
1.8 Loan Account...................................................................................20
ARTICLE 2 INTEREST AND FEES......................................................................................20
2.1 Interest.......................................................................................20
2.2 Continuation and Conversion Elections..........................................................21
2.3 Maximum Interest Rate..........................................................................22
2.4 Closing Fee....................................................................................23
2.5 Unused Line Fee................................................................................23
2.6 Brazilian Letter of Credit Fee.................................................................23
2.7 Letter of Credit Fee...........................................................................24
2.8 Collateral Administration Fee..................................................................24
ARTICLE 3 PAYMENTS AND PREPAYMENTS...............................................................................25
3.1 Revolving Loans................................................................................25
3.2 Repayment of the Term Loans....................................................................25
3.3 Prepayments of the Term Loans..................................................................25
3.4 LIBOR Rate Loan Prepayments....................................................................26
3.5 Payments by the Borrowers......................................................................26
3.6 Payments as Revolving Loans....................................................................27
3.7 Apportionment, Application and Reversal of Payments............................................27
3.8 Indemnity for Returned Payments................................................................28
3.9 Administrative Agent's and Lenders' Books and Records; Monthly Statements......................28
3.10 Limitations on Joint and Several Liability; Contribution Rights................................28
3.11 Guaranty of Parent.............................................................................29
3.12 Redenomination of Loans in Sterling............................................................32
3.13 Contractual Currency...........................................................................32
ARTICLE 4 TAXES, YIELD PROTECTION AND ILLEGALITY.................................................................33
4.1 Taxes..........................................................................................33
4.2 Illegality.....................................................................................34
4.3 Increased Costs and Reduction of Return........................................................34
4.4 Funding Losses.................................................................................35
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4.5 Inability to Determine Rates...................................................................35
4.6 Certificates of Administrative Agent...........................................................35
4.7 Survival.......................................................................................36
ARTICLE 5 BOOKS AND RECORDS; FINANCIAL INFORMATION; NOTICES......................................................36
5.1 Books and Records..............................................................................36
5.2 Financial Information..........................................................................36
5.3 Notices to the Lenders.........................................................................39
ARTICLE 6 GENERAL WARRANTIES AND REPRESENTATIONS.................................................................42
6.1 Authorization, Validity, and Enforceability of this Agreement and the Loan Documents...........42
6.2 Validity and Priority of Security Interest.....................................................42
6.3 Organization and Qualification.................................................................42
6.4 Corporate Name; Prior Transactions.............................................................43
6.5 Subsidiaries and Affiliates....................................................................43
6.6 Financial Statements and Projections...........................................................43
6.7 Capitalization.................................................................................44
6.8 Solvency.......................................................................................44
6.9 Debt...........................................................................................44
6.10 Distributions..................................................................................44
6.11 Real Estate; Leases............................................................................44
6.12 Proprietary Rights.............................................................................44
6.13 Trade Names....................................................................................45
6.14 Litigation.....................................................................................45
6.15 Labor Disputes.................................................................................45
6.16 Environmental Laws.............................................................................45
6.17 No Violation of Law............................................................................46
6.18 No Default.....................................................................................46
6.19 ERISA Compliance...............................................................................47
6.20 Taxes..........................................................................................47
6.21 Regulated Entities.............................................................................47
6.22 Use of Proceeds; Margin Regulations............................................................47
6.23 Infringements of Copyrights, Patents, Trademarks and Licenses, etc.............................48
6.24 No Material Adverse Change.....................................................................48
6.25 Full Disclosure................................................................................48
6.26 Material Agreements............................................................................48
6.27 Bank Accounts..................................................................................48
6.28 Governmental Authorization.....................................................................48
6.29 Purchase Agreement Transaction.................................................................49
ARTICLE 7 AFFIRMATIVE AND NEGATIVE COVENANTS.....................................................................49
7.1 Taxes and Other Obligations....................................................................49
7.2 Legal Existence and Good Standing..............................................................49
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7.3 Compliance with Law and Agreements; Maintenance of Licenses....................................49
7.4 Maintenance of Property; Inspection of Property................................................50
7.5 Insurance......................................................................................50
7.6 Insurance and Condemnation Proceeds............................................................51
7.7 Environmental Laws.............................................................................51
7.8 Compliance with ERISA..........................................................................53
7.9 Mergers, Consolidations or Sales...............................................................53
7.10 Distributions; Capital Change; Restricted Investments..........................................53
7.11 Transactions Affecting Collateral or Obligations...............................................54
7.12 Guaranties.....................................................................................54
7.13 Debt...........................................................................................55
7.14 Prepayment.....................................................................................55
7.15 Transactions with Affiliates...................................................................55
7.16 Investment Banking and Finder's Fees...........................................................56
7.17 Business Conducted.............................................................................56
7.18 Liens..........................................................................................56
7.19 Sale and Leaseback Transactions................................................................56
7.20 New Subsidiaries...............................................................................56
7.21 Fiscal Year....................................................................................56
7.22 Capital Expenditures...........................................................................56
7.23 Fixed Charge Coverage Ratio....................................................................57
7.24 Funded Debt to EBITDA..........................................................................58
7.25 Interest Coverage Ratio........................................................................58
7.26 Use of Proceeds................................................................................58
7.27 Hedge Agreements...............................................................................58
7.28 Further Assurances.............................................................................59
ARTICLE 8 CONDITIONS OF LENDING..................................................................................59
8.1 Conditions Precedent to Making of Loans on the Closing Date....................................59
8.2 Conditions Precedent to Making Term Loan (UK) Additional Advance...............................61
8.3 Conditions Precedent to Each Loan..............................................................62
ARTICLE 9 DEFAULT; REMEDIES......................................................................................63
9.1 Events of Default..............................................................................63
9.2 Remedies.......................................................................................65
ARTICLE 10 TERM AND TERMINATION..................................................................................67
10.1 Term and Termination...........................................................................67
ARTICLE 11 AMENDMENTS; WAIVERS; PARTICIPATIONS; ASSIGNMENTS; SUCCESSORS..........................................67
11.1 Amendments and Waivers.........................................................................67
11.2 Assignments; Participations....................................................................69
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ARTICLE 12 THE COLLATERAL AND ADMINISTRATIVE AGENT...............................................................71
12.1 Appointment and Authorization..................................................................71
12.2 Delegation of Duties...........................................................................72
12.3 Liability of Administrative Agent..............................................................72
12.4 Reliance by Administrative Agent...............................................................72
12.5 Notice of Default..............................................................................73
12.6 Credit Decision................................................................................73
12.7 Indemnification................................................................................73
12.8 Administrative Agent in Individual Capacity....................................................74
12.9 Successor Administrative Agent.................................................................74
12.10 Withholding Tax................................................................................75
12.11 Collateral Matters.............................................................................76
12.12 Restrictions on Actions by Lenders; Sharing of Payments........................................77
12.13 Agency for Perfection..........................................................................78
12.14 Payments by Administrative Agent to Lenders....................................................78
12.15 Settlement.....................................................................................78
12.16 Letters of Credit; Intra-Lender Issues.........................................................82
12.17 Concerning the Collateral and the Related Loan Documents.......................................83
12.18 Field Audit and Examination Reports; Disclaimer by Lenders.....................................84
12.19 Relation Among Lenders.........................................................................84
12.20 Other Administrative Agents....................................................................84
12.21 Rights of Administrative Agent as Security Trustee. In its capacity as Security
Trustee, the Administrative Agent shall:.......................................................85
ARTICLE 13 MISCELLANEOUS.........................................................................................85
13.1 No Waivers; Cumulative Remedies................................................................85
13.2 Severability...................................................................................85
13.3 Governing Law; Choice of Forum; Service of Process.............................................85
13.4 WAIVER OF JURY TRIAL...........................................................................86
13.5 Survival of Representations and Warranties.....................................................87
13.6 Other Security and Guaranties..................................................................87
13.7 Fees and Expenses..............................................................................87
13.8 Notices........................................................................................88
13.9 Waiver of Notices..............................................................................89
13.10 Binding Effect.................................................................................89
13.11 Indemnity of the Administrative Agent and the Lenders by the Borrowers.........................89
13.12 Limitation of Liability........................................................................90
13.13 Final Agreement................................................................................90
13.14 Counterparts...................................................................................90
13.15 Captions.......................................................................................90
13.16 Right of Setoff................................................................................90
13.17 Confidentiality................................................................................91
13.18 Conflicts with Other Loan Documents............................................................91
13.19 Joint and Several Liability....................................................................91
13.20 Contribution and Indemnification among the Borrowers...........................................93
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13.21 Agency of the Parent for each other Borrower...................................................93
13.22 No Liability of Brazilian Lender; Indemnification..............................................93
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ANNEXES, EXHIBITS AND SCHEDULES
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ANNEX A - DEFINED TERMS
EXHIBIT A-1 - FORM OF TERM NOTE (UK)
EXHIBIT A-2 - FORM OF TERM NOTE (France)
EXHIBIT A-3 - FORM OF BRAZILIAN LETTER OF CREDIT
EXHIBIT B - FORM OF BORROWING BASE CERTIFICATE
EXHIBIT C - FINANCIAL STATEMENTS
EXHIBIT D - FORM OF NOTICE OF BORROWING
EXHIBIT E - FORM OF NOTICE OF CONTINUATION/CONVERSION
EXHIBIT F - FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT
EXHIBIT G - ADDITIONAL BORROWER JOINDER SUPPLEMENT
SCHEDULE 6.3 - ORGANIZATION AND QUALIFICATIONS
SCHEDULE 6.4 - CORPORATE NAME; PRIOR TRANSACTIONS
SCHEDULE 6.5 - SUBSIDIARIES AND AFFILIATES
SCHEDULE 6.10 - DEBT
SCHEDULE 6.11 - REAL ESTATE; LEASES
SCHEDULE 6.12 - PROPRIETARY RIGHTS
SCHEDULE 6.13 - TRADE NAMES
SCHEDULE 6.14 - LITIGATION
SCHEDULE 6.15 - LABOR DISPUTES
SCHEDULE 6.16 - ENVIRONMENTAL LAW
SCHEDULE 6.19 - ERISA COMPLIANCE
SCHEDULE 6.26 - MATERIAL AGREEMENTS
SCHEDULE 6.27 - BANK ACCOUNTS
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SCHEDULE 7.10 - INVESTMENTS OUTSTANDING
SCHEDULE 7.13 - DEBT
SCHEDULE 7.16 - INVESTMENT BANKING AND FINDER'S FEE
SCHEDULE 7.18 - LIENS
SCHEDULE A-1 - EXISTING PERMITTED INTERCOMPANY ADVANCES
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of October 5, 2000, (this "Agreement")
among the financial institutions from time to time parties hereto (such
financial institutions, together with their respective successors and assigns,
are referred to hereinafter each individually as a "Lender" and collectively as
the "Lenders"), BANK OF AMERICA, N.A., with an office at 000 Xxxxx XxXxxxx
Xxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxxxxx 00000, as collateral and administrative
agent for the Lenders and as UK Security Trustee (in its capacity as agent and
as UK Security Trustee, the "Administrative Agent"), NATIONAL CITY BANK, a
national banking association, with an office at 1900 East Ninth Street, Locator
Number 2083, Xxxxxxxxx, Xxxx 00000, as Co-Administrative Agent, MULTI BANCO,
S.A., a banking corporation organized under the laws of the Republic of Brasil
(the "Brazilian Lender"), solely for the purposes of Section 1.4(a), and UNIFRAX
CORPORATION, a Delaware corporation with principal offices located at 0000
Xxxxxxxxx Xxxxxx, Xxxxxxx Xxxxx, Xxx Xxxx 00000-0000, ("Parent"), UNIFRAX UK
HOLDCO LIMITED, a company organized and existing under the laws of England and
Wales with principal offices located at c/o Jones, Day, Xxxxxx & Xxxxx,
Bucklersbury House, 3 Queen Xxxxxxxx Xxxxxx, Xxxxxx XX00 0XX ("UK Holdco"),
Unifrax Limited, a company organized and existing under the laws of England and
Wales with principal offices located in Rainsford, England ("Unifrax UK"), NAF
Brazil Ltda., a limitada organized under the laws of Brazil ("Unifrax Brazil"),
solely for the purposes of Section 1.4(a), and UNIFRAX HOLDING FRANCE, a company
organized and existing under the laws of France with principal offices located
at 00 xxx xx Xxxxx, 00000 Xxxxx, Xxxxxx ("French Holdco"), jointly and severally
(Parent, UK Holdco, Unifrax UK and French Holdco individually a "Borrower" and
collectively, the "Borrowers;" UK Holdco, Unifrax UK sometimes together, the "UK
Borrowers").
WITNESSETH:
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WHEREAS, the Borrowers have requested the Lenders to make available to
the Borrowers a revolving line of credit for loans and letters of credit in an
amount not to exceed U.S. $19,000,000 to the Parent and (pound)4,123,711.34 to
UK Holdco and Unifrax UK, and to make term credit facilities available to the
Borrowers in the aggregate principal amount of (a) (pound)4,123,711.34 UK
Holdco, (b) Euro 11,454,753.72 to French Holdco and (c) $12,500,000 in the form
of the Brazilian Letter of Credit (hereinafter defined), $9,000,000 of which
shall be part of the term loan facility and the balance of which shall be
charged as a reserve against the US Borrowing Base (hereinafter defined) issued
by the Administrative Agent, which extensions of credit the Borrowers will use
to finance the cash portion of the "Purchase Agreement Transaction" (as
hereinafter defined) and for their working capital needs and general business
purposes; and
WHEREAS, capitalized terms used in this Agreement and not otherwise
defined herein shall have the meanings ascribed thereto in Annex A which is
attached hereto and incorporated herein; the rules of construction contained
therein shall govern the interpretation of this Agreement, and all Annexes,
Exhibits and Schedules attached hereto are incorporated herein by reference;
WHEREAS, the Lenders have agreed to make available to the Borrowers a
revolving credit facility and term loans upon the terms and conditions set forth
in this Agreement.
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NOW, THEREFORE, in consideration of the mutual conditions and
agreements set forth in this Agreement, and for good and valuable consideration,
the receipt of which is hereby acknowledged, the Lenders, the Administrative
Agent, the Co-Administrative Agent, and the Borrowers hereby agree as follows:
ARTICLE 1
LOANS AND LETTERS OF CREDIT
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1.1 TOTAL FACILITY.
Subject to all of the terms and conditions of this Agreement,
the Lenders agree to make available a total Credit Facility consisting of (a) a
US Revolving Loan not to exceed US. $19,000,000; (b) a UK Revolving Loan not to
exceed (pound)4,123,711.34; (c) a Term Loan (UK) in the amount of
(pound)4,123,711.34; (d) a Term Loan (France) in the amount of Euro
11,454,753.72; and (e) the Brazilian Letter of Credit in the amount of
$12,500,000, $9,000,000 of which shall be part of the term loan facility and the
balance of which shall be charged as a reserve against the US Borrowing Base
(collectively, the "Total Credit Facility") to the Borrowers from time to time
during the term of this Agreement. The Total Credit Facility shall be composed
of a revolving line of credit consisting of Revolving Loans and Letters of
Credit and the Term Loans described herein. As part of the Credit Facility, the
Brazilian Lender will make the loans under the Brazilian Loan Documents which
are secured by the Brazilian Letter of Credit, as further set forth in SECTION
1.4(a).
1.2 REVOLVING LOANS.
Subject to all of the terms and conditions of this Agreement,
the US Lenders shall make the US Revolving Loans to the Parent and the UK Lender
shall make the UK Revolving Loans to UK Holdco and Unifrax UK, as follows:
(a) AMOUNTS - US REVOLVING LOANS. Subject to the satisfaction
of the conditions precedent set forth in ARTICLE 8 (Conditions of Lending), each
US Lender severally agrees, upon the Parent's request from time to time on any
Business Day during the period from the Closing Date to the Termination Date, to
make revolving loans to the Parent denominated in Dollars and advanced in one or
more other Approved Currencies designated by the Parent at any time and from
time to time (the "US Revolving Loans"), in amounts not to exceed (except for
Non-Ratable Loans and Administrative Agent Advances) such US Lender's Pro Rata
Share of the US Availability.
(b) AMOUNTS - UK REVOLVING LOANS. Subject to the satisfaction
of the conditions precedent set forth in ARTICLE 8 (Conditions of Lending), the
UK Lender agrees, upon the request of UK Holdco or Unifrax UK from time to time
on any Business Day during the period from the Closing Date to the Termination
Date, to make revolving loans to UK Holdco or Unifrax UK denominated in Sterling
and advanced in one or more other Approved Currencies designated by UK Holdco or
Unifrax UK at any time and from time to time (the "UK Revolving Loans") in
amounts not to exceed (except for Administrative Agent Advances) the UK
Availability.
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(c) ADVANCES IN EXCESS OF US AVAILABILITY/UK AVAILABILITY. The
applicable Lenders, in their unanimous discretion, may elect to make US
Revolving Loans or UK Revolving Loans, as the case may be, or issue or arrange
to have issued US Letters of Credit or UK Letters of Credit, as the case may be,
in excess of the US Borrowing Base or the UK Borrowing Base, respectively, on
one or more occasions, but if they do so, neither the Administrative Agent nor
any of the Lenders shall be deemed thereby to have changed the limits of the US
Borrowing Base or the UK Borrowing Base or to be obligated to exceed such limits
on any other occasion. If the Aggregate US Revolving Loans Outstandings exceed
the US Borrowing Base or the Aggregate UK Revolving Loans Outstandings exceed
the UK Borrowing Base, the Lenders may refuse to make or may otherwise restrict
the making of Revolving Loans as such Lenders determine until such excess has
been eliminated, subject to the Administrative Agent's authority, in its sole
discretion, to make Administrative Agent Advances pursuant to the terms of
SECTION 1.2(i).
(d) REPAYMENT OF REVOLVING LOANS.
(i) The Parent is obligated to repay in full the US
Revolving Loans, together with interest thereon as prescribed under SECTION 2.1.
The entire unpaid principal balance of the US Revolving Loans and all other
non-contingent Obligations related thereto shall be immediately due and payable
in full in immediately available funds on the Termination Date.
(ii) The Parent, UK Holdco and Unifrax UK are jointly
and severally obligated to repay in full the UK Revolving Loans, together with
interest thereon as prescribed under SECTION 2.1. The entire unpaid principal
balance of the UK Revolving Loans and all other non-contingent Obligations
related thereto shall be immediately due and payable in full in immediately
available funds on the Termination Date.
(e) PROCEDURE FOR BORROWING.
(i) Each Borrowing shall be made upon the applicable
Borrower's irrevocable written notice delivered to the Administrative Agent in
the form of a notice of borrowing ("Notice of Borrowing"), to the Appropriate
Notice Office which must be received prior to 12:00 noon (prevailing time in the
location of the Appropriate Notice Office) (i) three (3) Business Days prior to
the requested Funding Date, in the case of LIBOR Rate Loans, and (ii) no later
than 11:00 a.m. (prevailing time in the location of the Appropriate Notice
Office) on the requested Funding Date, in the case of Base Rate Loans,
specifying:
(1) the amount of the Borrowing, which in
the case of a LIBOR Rate Loan must equal or exceed $1,000,000 for US Revolving
Loans or (pound)100,000 for UK Revolving Loans (and increments of $500,000 or
(pound)100,000, respectively, in excess of such amount) or the Foreign Currency
Equivalent or the Sterling Equivalent, if applicable, thereof;
(2) the currency in which the Borrowing is
required, which must be an Approved Currency;
(3) the requested Funding Date, which must
be a Business Day;
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(4) whether the Revolving Loans requested
are to be Base Rate Revolving Loans or LIBOR Revolving Loans; and
(5) the duration of the Interest Period for
LIBOR Revolving Loans (and if not specified, it shall be deemed a request for an
Interest Period of one month).
(ii) In the case of US Revolving Loans only, in lieu
of delivering a Notice of Borrowing, the Parent may give the Administrative
Agent telephonic notice of such request for US Revolving Loans by the required
time for advances to a Designated Account. The Administrative Agent at all times
shall be entitled to rely on such telephonic notice in making such US Revolving
Loans, regardless of whether any written confirmation is received.
(iii) No Borrower shall have any right to request a
Revolving Loan as a LIBOR Rate Loan while a Default or Event of Default has
occurred and is continuing.
(iv) The Parent shall not have the right to request a
Base Rate Loan for any Approved Currency other than Dollars.
(f) RELIANCE UPON AUTHORITY. Prior to the Closing Date, each
of the Parent and the UK Borrowers shall deliver to the Administrative Agent, a
notice setting forth the account or accounts of, as applicable, the Parent or
the UK Borrowers (each a "Designated Account" and collectively, the "Designated
Accounts") to which the Administrative Agent is authorized to transfer the
proceeds of all or any portion of the Revolving Loans requested hereunder. Each
such Borrower may designate a replacement account from time to time by at least
five (5) Business Days' prior written notice to the Administrative Agent. All
such Designated Accounts must be reasonably satisfactory to the Administrative
Agent. The Administrative Agent is entitled to rely conclusively on any
Responsible Officer's request for Revolving Loans on behalf of a Borrower, so
long as the proceeds thereof are to be transferred to a Designated Account. The
Administrative Agent has no duty to verify the identity of any individual
representing himself or herself as a Responsible Officer authorized by any
Borrower to make such requests on its behalf.
(g) NO LIABILITY. The Administrative Agent shall not incur any
liability to any Borrower as a result of acting upon any notice referred to in
SECTIONS 1.2(e) and 1.2(f), which the Administrative Agent believes in good
faith to have been given by a Responsible Officer or other person duly
authorized by the applicable Borrower to request Revolving Loans on its behalf.
The crediting of Revolving Loans to a Designated Account conclusively
establishes the obligation of the applicable Borrowers to repay such Revolving
Loans as provided herein.
(h) NOTICE IRREVOCABLE. Any Notice of Borrowing (or telephonic
notice in lieu thereof) made pursuant to SECTION 1.2(e) is irrevocable. The
Borrowers shall be bound to borrow the funds requested therein in accordance
therewith.
(i) ADMINISTRATIVE AGENT'S ELECTION. With respect to US
Revolving Loans, promptly after receipt of a Notice of Borrowing (or telephonic
notice in lieu thereof for US Revolving Loans), the Administrative Agent shall
elect to have the terms of SECTION 1.2(j) or the terms of SECTION 1.2(k) apply
to such requested Borrowing. If the Bank declines in its sole
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discretion to make a Non-Ratable Loan pursuant to Section 1.2(k), the terms of
Section 1.2(j) shall apply to the requested Borrowing.
(j) MAKING OF REVOLVING LOANS. Promptly after receipt of a
Notice of Borrowing or telephonic notice in lieu thereof (if permitted) with
respect to UK Revolving Loans or, with respect to US Revolving Loans, if the
Administrative Agent elects to have the terms of this SECTION 1.2(j) apply to a
requested Borrowing, the Administrative Agent shall notify the Lenders by
telecopy, telephone or e-mail of the requested Borrowing. Each applicable Lender
shall transfer its Pro Rata Share of the requested Borrowing available to the
Administrative Agent in immediately available funds, to the account from time to
time designated by Administrative Agent, not later than 12:00 noon (prevailing
time in the location of the Appropriate Notice Office) on the applicable Funding
Date. After the Administrative Agent's receipt of all proceeds of such Revolving
Loans, the Administrative Agent shall make the proceeds of such Revolving Loans
available to the applicable Borrower on the applicable Funding Date by
transferring same day funds to the account designated by such Borrower;
PROVIDED, HOWEVER, that, except as provided in SECTION 1.2(c) the amount of US
Revolving Loans so made on any date shall not exceed the US Availability and the
amount of UK Revolving Loans so made on any date shall not exceed the UK
Availability, as the case may be, on such date.
(k) MAKING OF NON-RATABLE LOANS.
(i) If Administrative Agent elects, with the consent
of the Bank, to have the terms of this SECTION 1.2(k) apply to a requested
Borrowing of US Revolving Loans, the Bank shall make a Revolving Loan in the
amount of that Borrowing available to the applicable Borrower on the applicable
Funding Date by transferring same day funds to the applicable Borrower's
Designated Account. Each US Revolving Loan made solely by the Bank pursuant to
this Section is herein referred to as a "Non-Ratable Loan," and such Revolving
Loans are collectively referred to as the "Non-Ratable Loans." Each Non-Ratable
Loan shall be subject to all the terms and conditions applicable to other
Revolving Loans except that all payments thereon shall be payable to the Bank
solely for its own account. The aggregate amount of Non-Ratable Loans
outstanding at any time shall not exceed $5,000,000 or the Foreign Currency
Equivalent thereof. The Administrative Agent shall not request the Bank to make
any Non-Ratable Loan if (1) the Administrative Agent has received written notice
from any Lender that one or more of the applicable conditions precedent set
forth in ARTICLE 8 will not be satisfied on the requested Funding Date for the
applicable Borrowing, or (2) the requested Borrowing would exceed the US
Availability on that Funding Date. The Administrative Agent shall not otherwise
be required to determine whether the applicable conditions precedent set forth
in ARTICLE 8 have been satisfied or the requested Borrowing would exceed the US
Availability on that Funding Date applicable thereto prior to requesting the
Bank to make a Non-Ratable Loan. For the avoidance of doubt, the concept of
Non-Ratable Loans shall be inapplicable to the UK Borrowers since the UK Lender
only shall make the UK Revolving Loans.
(ii) The Non-Ratable Loans shall be secured by the
Administrative Agent's Liens in and to the Collateral and shall constitute Base
Rate Revolving Loans made in Dollars and shall be included in the Obligations
hereunder.
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(l) ADMINISTRATIVE AGENT ADVANCES.
(i) Subject to the limitations set forth below, the
Administrative Agent is authorized by the Borrowers and the Lenders, from time
to time in the Administrative Agent's sole discretion, (A) after the occurrence
of a Default or an Event of Default, or (B) at any time that any of the other
conditions precedent set forth in ARTICLE 8 have not been satisfied, to make
Base Rate Revolving Loans in Dollars to any Borrower on behalf of the Lenders in
an aggregate amount outstanding at any time not to exceed 10% of the US
Borrowing Base or 10% of the UK Borrowing Base, as applicable, which the
Administrative Agent, in its reasonable business judgment, deems necessary or
desirable (1) to preserve or protect the Collateral, or any portion thereof, (2)
to enhance the likelihood of, or maximize the amount of, repayment of the Loans
and other Obligations, or (3) to pay any other amount chargeable to any Borrower
pursuant to the terms of this Agreement, including costs, fees and expenses as
described in SECTION 13.7 (any of such advances are herein referred to as an
"Administrative Agent Advance" and collectively as the "Administrative Agent
Advances"); PROVIDED that the Majority Lenders may at any time revoke the
Administrative Agent's authorization to make Administrative Agent Advances. Any
such revocation must be in writing and shall become effective prospectively upon
the Administrative Agent's receipt thereof. The Administrative Agent shall
notify each Lender in writing of each Administrative Agent Advance.
(ii) The Administrative Agent Advances shall be
secured by the Administrative Agent's Liens in and to the Collateral and shall
constitute Base Rate Revolving Loans made in Dollars or in Sterling and shall be
included in the Obligations hereunder.
1.3 TERM CREDIT FACILITIES.
(a) COMMITMENTS. Subject to all of the terms and conditions of
this Agreement, each of the applicable Lenders shall provide a term credit
facility (the "Term Credit Facility") in an aggregate amount equal to such
Lender's Pro Rata Share of the following (collectively, the "Term Credit
Facility Commitment"), consisting of the Term Loans and the Brazilian Letter of
Credit, described as follows:
(i) The UK Lender commits to make a term loan to UK
Holdco in the maximum amount of (pound)4,123,711.34 (the "Term Loan (UK)"), the
first advance of which (the "Term Loan (UK) Initial Advance") shall be in the
amount of (pound)2,405,498.2822222the second advance of which (the "Term Loan
(UK) Additional Advance") shall be in an amount equal to the lesser of
(pound)1,718,213.60 or 75% of the appraised value, determined in the manner set
forth in SECTION 8.2(c), of the Real Property covered by the Mortgage (UK) and
shall be used for the purposes set forth in SECTION 6.22.
(ii) The French Lenders severally commit to each make
a term loan (collectively, the "Term Loan (France)") to French Holdco in the
aggregate amount of Euro 11,454,753.72 (the "Term Loan (France)").
(iii) The Administrative Agent commits to have the
Letter of Credit Issuer issue the Brazilian Letter of Credit on behalf of the
Lenders in accordance with the provisions of SECTION 1.4 in the stated amount
of $12,500,000, with respect to which $9,000,000
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shall be made as part of the Term Credit Facility and the balance of which shall
be reserved against the US Borrowing Base. The Parent agrees to request that the
Administrative Agent, on behalf of the Lenders, have the Letter of Credit Issuer
issue an amendment to increase the stated amount of the Brazilian Letter of
Credit in the event that the Brazilian Lender reasonably determines that, based
upon the increase of the value of the Real to the Dollar or based on an increase
in the interest rate index applicable to the obligations under the Brazilian
Loan Documents, the Brazilian Letter of Credit does not provide adequate credit
enhancement for the Brazilian Loan. Any increase to the Brazilian Letter of
Credit shall increase the Brazilian Letter of Credit Reserves.
The Term Credit Facility shall be made available to the applicable Borrowers on
the Closing Date, upon the satisfaction of the conditions precedent set forth in
ARTICLE 8 (Conditions of Lending). Each applicable Lender's Commitment to make
the Term Loans and to purchase a participation interest in the Brazilian Letter
of Credit is several and is limited in the principal amount set forth below such
Lender's signature to this Agreement. The Administrative Agent shall not be
responsible for the Term Credit Facility Commitment of any Lender; and
similarly, none of the Lenders shall be responsible for the Term Credit Facility
Commitment of any of the other Lenders; the failure, however, of any Lender to
perform its Commitment shall not relieve any of the other Lenders from the
performance of their respective Commitments.
(b) TERM CREDIT SCHEDULED PRINCIPAL PAYMENTS AND REDUCTIONS.
In accordance with the terms of the Term Loan Notes and the Brazilian Letter of
Credit Documents:
(i) In accordance with the terms of the Term Loan
Notes, the applicable Borrowers shall make monthly installment payments of
principal on the Term Loans as follows:
----------------------------------------------------------------------------------------------
Term Loan (UK) Term Loan (France)
Payments Installment Installment
----------------------------------------------------------------------------------------------
Payments 1 through 12, beginning December (pound)41,237.11 Euro 114,547.54
1, 2000 and due the first day of each
month thereafter:
----------------------------------------------------------------------------------------------
Payments 13 through 30, beginning December (pound)61,855.67 Euro 171,821.31
1, 2001 and due the first day of each
month thereafter:
----------------------------------------------------------------------------------------------
The Term Loans shall mature and the entire unpaid principal balance of Term
Loans shall be due and payable in full on August 1, 2003.
(ii) The stated amount of the Brazilian Letter of
Credit by its terms reduces from time to time based on the amount of scheduled
payments of principal and interest on the Brazilian Loan Obligations. The
following table shows the principal portion of the stated reduction. Actual
aggregate reductions of the Brazilian Letter of Credit, however, are subject to
the provision of SECTION 1.3(a)(iii) in the event there is an increase of the
value of the Real to the
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Dollar or there is an increase in the interest rate index applicable to the
obligations under the Brazilian Loan Documents.
--------------------------------------------------------------------------------
Brazilian Letter of Credit
--------------------------------------------------------------------------------
Date of Reduction Principal Portion of Reduction
--------------------------------------------------------------------------------
Reductions 1 through 4, beginning January $270,000.00
1, 2001 and made the first day of each
calendar quarter thereafter:
--------------------------------------------------------------------------------
Reductions 5 through 7, beginning January $405,000.00
1, 2002 and made the first day of each
calendar quarter thereafter:
--------------------------------------------------------------------------------
The Brazilian Letter of Credit expires on October 1, 2002.
(c) TERM CREDIT FACILITY MANDATORY PREPAYMENTS.
Subject to the provisions of SECTION 3.10(a), the Parent and
the other applicable Borrowers shall jointly and severally make annual mandatory
prepayments (each a "Term Credit Facility Mandatory Prepayment;" and
collectively, the "Term Credit Facility Mandatory Prepayments") to the
Administrative Agent for the applicable Lenders in accordance with their
respective Pro Rata Share. Each Term Credit Facility Mandatory Prepayment shall
be in the amount equal to (a) seventy-five percent (75%) of Excess Cash Flow of
the Parent and its Subsidiaries for Fiscal Year 2001 and (b) fifty percent (50%)
of Excess Cash Flow of the Parent and its Subsidiaries for each Fiscal Year
thereafter until the Obligations in respect of the Term Loans have been repaid
in full and the Brazilian Letter of Credit has been terminated and/or expired
and all Brazilian Letter of Credit Obligations have been paid in full. Term
Credit Facility Mandatory Prepayments shall be payable on the date which is ten
(10) days after the Parent has furnished to the Administrative Agent the annual
financial statements referred to in SECTION 5.2 (Financial Statements). If,
however, the Parent fails to furnish such financial statements in any given
calendar year as and when required, the Borrowers shall be required to pay the
Term Credit Facility Mandatory Prepayment payable during such calendar year, as
reasonably determined by the Administrative Agent, on the date which is one
hundred twenty (120) days after the close of the then preceding Fiscal Year of
the Parent and its Subsidiaries.
Each Term Credit Facility Mandatory Prepayment shall be
applied:
FIRST, to the Term Loan (France), applied to the
balloon payment due at maturity and then to principal installments in
the inverse order of their maturities until the Obligations with
respect of Term Loan (France) have been repaid and satisfied in full;
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SECOND, either (A) to repay the obligations under the
Brazilian Loan Documents, applied, not to the loan that matures at
substantially the same time as the Brazilian Letter of Credit expires,
but to the loans under the Brazilian Loan Documents in the inverse
order of their maturities until the obligations with respect to the
loans under Brazilian Loan Documents have been repaid and satisfied in
full, the Parent hereby agreeing to make reasonable and diligent
efforts to cause an equal reduction in the stated amount of the
Brazilian Letter of Credit, or (B) otherwise, (1) as a deposit to one
or more non-interest bearing accounts with and in the name of the
Administrative Agent and over which the Administrative Agent alone
shall have exclusive power of access and withdrawal (the "Brazilian
Letter of Credit Cash Collateral Account") or (2) as a repayment of the
US Revolving Loans, with a reservation (the "Brazilian Letter of Credit
Prepayment Reserve") against US Availability in the amount of such
repayment; and
THIRD, to the Term Loan (UK), applied to the balloon
payment due at maturity and then to principal installments in the
inverse order of their maturity.
The Brazilian Letter of Credit Cash Collateral Account is to
be held by the Administrative Agent, for the ratable benefit of the Lenders, as
additional collateral and security for all of the Obligations, including the
Brazilian Letter of Credit Obligations. The Parent hereby assigns, pledges,
grants and sets over to the Administrative Agent, for the ratable benefit of the
Lenders, a first priority security interest in, and Lien on, all of the funds on
deposit in the Brazilian Letter of Credit Cash Collateral Account, together with
any and all proceeds (cash and non-cash) and products thereof as additional
collateral and security for the Obligations. The Parent acknowledges and agrees
that the Administrative Agent shall be entitled to fund any draw under the
Brazilian Letter of Credit from the monies on deposit in the Brazilian Letter of
Credit Cash Collateral Account without notice to or consent of the Parent or any
of the Lenders. The Parent further acknowledges and agrees that the
Administrative Agent's election to draw from the Brazilian Letter of Credit Cash
Collateral Account shall in no way limit, impair, lessen, reduce, release or
otherwise adversely affect the Parent's obligation to pay any Brazilian Letter
of Credit Obligations. At such time as the Brazilian Letter of Credit has
expired or been terminated and all Brazilian Letter of Credit Obligations have
been paid in full, the Administrative Agent agrees to apply the amount of any
remaining funds on deposit in the Brazilian Letter of Credit Cash Collateral
Account to the then unpaid balance of the Obligations in such order and manner
as the Administrative Agent shall determine in its sole and absolute discretion
in accordance with the provisions of this Agreement. During the continuance of
an Event of Default, the Administrative Agent, in the exercise of its sole and
absolute discretion from time to time, or, absent an Event of Default, the
Parent, shall determine whether a Term Credit Facility Mandatory Prepayment with
respect to the Brazilian Letter of Credit shall be deposited to the Brazilian
Letter of Credit Cash Collateral Account, as a prepayment of the US Revolving
Loans or as a prepayment of obligations under the Brazilian Loan Documents. All
funds on deposit in the Brazilian Letter of Credit Cash Collateral Account are
part of the Collateral for all of the Obligations.
If the aggregate of the Brazilian Letter of Credit Reserve,
plus the amounts on deposit in the Brazilian Letter of Credit Cash Collateral
Account plus the Brazilian Letter of
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Credit Prepayment Reserve, at any time exceeds the then existing face amount of
the Brazilian Letter of Credit, the Administrative Agent shall apply the excess
(A) as a Term Credit Facility Mandatory Prepayment of the Term Loan (UK) FIRST
by application of the Brazilian Letter of Credit Cash Collateral Account, and
SECOND by reduction of the Brazilian Letter of Credit Prepayment Reserve and a
simultaneous advance under the US Revolving Loans in the amount thereof, or (B)
if the Term Loan (UK) has been repaid in full, (1) absent an Event of Default,
as a payment to the US Revolving Loans first, up to the amount of the Brazilian
Letter of Credit Cash Collateral Account and then as a reduction of the
Brazilian Letter of Credit Prepayment Reserve, or (2) during the continuance of
an Event of Default, to any of the Obligations, as the Administrative Agent may
elect, in the exercise of its sole and absolute discretion. Any such application
shall not take effect unless the Administrative Agent has determined whether or
not such an excess exists and has allocated such excess, which determination and
allocation the Administrative Agent agrees to effect promptly after the written
request of Parent therefor.
(d) MAKING OF TERM LOANS. Each Lender shall make the amount of
such Lender's Term Loans available to the Administrative Agent in same day
funds, to the Administrative Agent's designated account, not later than at 11:00
a.m. (London time) on the Closing Date; PROVIDED, HOWEVER, that the UK Lender
shall make the amount of such Lender's Term Loan (UK) Additional Advance
available to the Administrative Agent in same day funds, to the Administrative
Agent's designated account, not later than at 11:00 a.m. (London time) on the
third Business Day after the Administrative Agent, in the exercise of its
reasonable judgment, notifies the UK Lender that the conditions of SECTIONS 8.2
AND 8.3 have been met. After the Administrative Agent's receipt of the proceeds
of such Term Loans, upon satisfaction of the conditions precedent set forth in
ARTICLE 8, the Administrative Agent shall make the proceeds of such Term Loans
available to the applicable Borrowers on such Funding Date by transferring same
day funds equal to the proceeds of such Term Loans received by the
Administrative Agent to an account of the Borrowers designated in writing by the
Borrowers or as Parent shall otherwise instruct in writing.
(e) TERM LOAN NOTES.
(i) The Parent, UK Holdco and Unifrax UK are jointly and
severally obligated to repay in full the Term Loan (UK), together with interest
thereon as prescribed under SECTION 2.1. The Parent, UK Holdco and Unifrax UK
shall execute and deliver to the UK Lender a note dated the Closing Date
substantially in the form of EXHIBIT A-1 ("Term Note (UK)") in the maximum
principal amount of the Term Loan (UK) for the purpose of further evidencing
their Obligations to the UK Lender in respect of the Term Loan (UK).
(ii) The Parent and French Holdco are jointly and severally obligated to repay
in full the Term Loan (France), together with interest thereon as prescribed
under SECTION 2.1. The Parent and French Holdco shall execute and deliver to
each French Lender a note dated the Closing Date in substantially the form of
EXHIBIT A-2 ("Term Notes (France)") each in the principal amount of each French
Lender's Pro Rata Share of the Term Loan (France) for the purpose of further
evidencing their Obligations to the French Lenders in respect of the Term Loan
(France).
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(iii) The Parent is obligated to repay in full the
Brazilian Letter of Credit Obligations in accordance with the terms of the
Brazilian Letter of Credit Documents.
(f) NOTATION AND ENDORSEMENT. The Administrative Agent shall
record on its books the principal amount of the Term Loans owing to each Lender
from time to time. In addition, each Lender is authorized, at such Lender's
option, to note the date and amount of each payment or prepayment of principal
of such Lender's Term Loans in its books and records, such books and records
constituting rebuttably presumptive evidence, absent manifest error, of the
accuracy of the information contained therein. Prior to the transfer of a Term
Loan Note, the applicable Lender shall endorse on the reverse side thereof the
outstanding principal balance of the Term Loan evidenced thereby. Failure by
such Lender to make such notation or endorsement shall not affect the
obligations of the Borrowers under such Term Loan Note or any of the other Loan
Documents.
1.4 BRAZILIAN LETTER OF CREDIT.
(a) BRAZILIAN LENDER'S AGREEMENT. As a part of the credit
accommodations under this Agreement, at the request of the Parent, the Brazilian
Lender confirms its agreement under the laws of Brazil to provide the loans, and
Unifrax Brazil confirms its agreement to borrow, all as described in the
Brazilian Loan Documents, subject to the terms and conditions of the Brazilian
Loan Documents, in reliance upon the Brazilian Letter of Credit. This Agreement
and the other Loan Documents may be as amended, modified, restated, substituted,
extended and renewed from time to time without notice to or consent of the
Brazilian Lender or Unifrax Brazil.
(b) AGREEMENT TO ISSUE. Subject to the terms and conditions of
this Agreement, and in reliance upon the representations and warranties of the
Borrowers herein set forth, the Administrative Agent agrees to issue on the
Closing Date for the account of Parent a standby letter of credit substantially
in the form of EXHIBIT A-3 attached hereto and made a part hereof (the
"Brazilian Letter of Credit") in the initial stated amount of $12,500,000 for
the benefit of the Brazilian Lender, with an expiration date of October 1, 2002
and with the appropriate insertions. The stated amount of the Brazilian Letter
of Credit shall reduce as set forth in EXHIBIT A-3.
(c) OTHER CONDITIONS. In addition to being subject to the
satisfaction of the applicable conditions precedent contained in ARTICLE 8, the
obligation of the Administrative Agent to issue the Brazilian Letter of Credit
is subject to the following conditions precedent having been satisfied in a
manner satisfactory to the Administrative Agent:
(i) The Parent shall have delivered to the
Administrative Agent the completed and fully executed Brazilian Letter of Credit
Documents, and the form and terms of the proposed Brazilian Letter of Credit
shall be satisfactory to the Administrative Agent.
(ii) As of the date of issuance, no order of any
court, arbitrator or Governmental Authority shall purport by its terms to enjoin
or restrain money center banks generally from issuing letters of credit of the
type and in the amount of the Brazilian Letter of Credit, and no law, rule or
regulation applicable to money center banks generally and no request
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or directive (whether or not having the force of law) from any Governmental
Authority with jurisdiction over money center banks generally shall prohibit
from, or request that the Administrative Agent refrain from, the issuance of
letters of credit generally or the issuance of the Brazilian Letter of Credit.
(d) NO EXTENSIONS. The Administrative Agent shall not be
obligated to extend the Brazilian Letter of Credit. With respect to any
extension, amendment, or "evergreen" or automatic renewal provision of the
Brazilian Letter of Credit, each Lender shall be deemed to have consented to any
such extension or renewal unless the extension or renewal would cause the
expiration date of the Brazilian Letter of Credit to be later than thirty (30)
days prior to the Stated Termination Date.
(e) PAYMENTS PURSUANT TO BRAZILIAN LETTER OF CREDIT.
(i) PAYMENT OF BRAZILIAN LETTER OF CREDIT
OBLIGATIONS. The Parent agrees to reimburse the Administrative Agent for any
draw under the Brazilian Letter of Credit and the amount of all other
Obligations and other charges, fees and amounts payable in connection with the
Brazilian Letter of Credit immediately when due, irrespective of any claim,
setoff, defense or other right which any of the Borrowers may have at any time
against the Administrative Agent or any other Person.
(ii) REVOLVING LOANS TO SATISFY REIMBURSEMENT
OBLIGATIONS. In the event that the Administrative Agent honors a draw under the
Brazilian Letter of Credit and Parent shall not have repaid such amount to the
Administrative Agent pursuant to SECTION 1.4(e)(i) (Payment of Brazilian Letter
of Credit Obligations), the Administrative Agent shall, upon receiving notice of
such failure, notify each Lender of such failure, and each Lender shall
unconditionally pay to the Administrative Agent, for the account of the
Administrative Agent, as applicable, as and when provided hereinbelow, an amount
equal to such Lender's Pro Rata Share of the amount of such payment in Dollars
and in same day funds. If the Administrative Agent so notifies the Lenders prior
to 11:00 a.m. (Chicago, Illinois time) on any Business Day, each Lender shall
make available to the Administrative Agent the amount of such payment, as
provided in the immediately preceding sentence, on such Business Day.
(f) COMPENSATION FOR BRAZILIAN LETTER OF CREDIT.
(i) BRAZILIAN LETTER OF CREDIT FEE. The Parent agrees
to pay to the Administrative Agent with respect to the Brazilian Letter of
Credit, for the account of the Lenders, the Brazilian Letter of Credit Fee
specified in, and in accordance with the terms of, SECTION 2.6 (Brazilian Letter
of Credit Fee).
(ii) ISSUER FEES AND CHARGES. The Parent shall pay to
the Administrative Agent, for the account of the Administrative Agent, the
standard fees of the Administrative Agent for issuing, administering, amending,
renewing, paying and canceling the Brazilian Letter of Credit and all other fees
associated with issuing or servicing the Brazilian Letter of Credit, as and when
assessed.
(g) INDEMNIFICATION; EXONERATION; POWER OF ATTORNEY.
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(i) INDEMNIFICATION. In addition to amounts payable
as elsewhere provided in this SECTION 1.4, Parent hereby agrees to protect,
indemnify, pay and save the Lenders and the Administrative Agent harmless from
and against any and all claims, demands, liabilities, damages, losses, costs,
charges and expenses (including reasonable attorneys' fees) which any Lender or
the Administrative Agent may incur or be subject to as a consequence, direct or
indirect, of the issuance of the Brazilian Letter of Credit. Obligations under
this SECTION 1.4(g)(i) shall survive payment of all Obligations.
(ii) ASSUMPTION OF RISK BY THE BORROWERS. As among
the Parent, the Lenders, and the Administrative Agent, the Parent assumes all
risks of the acts and omissions of, or misuse of the Brazilian Letter of Credit
by the beneficiary of the Brazilian Letter of Credit. In furtherance and not in
limitation of the foregoing, the Lenders and the Administrative Agent shall not
be responsible for: (A) the form, validity, sufficiency, accuracy, genuineness
or legal effect of any document submitted by any Person in connection with the
application for and issuance of and presentation of drafts with respect to the
Brazilian Letter of Credit, even if it should prove to be in any or all respects
invalid, insufficient, inaccurate, fraudulent or forged; (B) the validity or
sufficiency of any instrument transferring or assigning or purporting to
transfer or assign the Brazilian Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason; (C) the failure of the beneficiary of the
Brazilian Letter of Credit to comply duly with conditions required in order to
draw upon the Brazilian Letter of Credit; (D) errors, omissions, interruptions,
or delays in transmission or delivery of any messages, by mail, cable,
telegraph, telex or otherwise, whether or not they be in cipher; (E) errors in
interpretation of technical terms; (F) any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under the
Brazilian Letter of Credit or of the proceeds thereof; (G) the misapplication by
the beneficiary of the Brazilian Letter of Credit of the proceeds of any drawing
under the Brazilian Letter of Credit; or (H) any consequences arising from
causes beyond the control of the Lenders or the Administrative Agent, including,
without limitation, any act or omission, whether rightful or wrongful, of any
present or future DE JURE or DE FACTO Governmental Authority. None of the
foregoing shall affect, impair or prevent the vesting of any rights or powers of
the Administrative Agent or any Lender under this SECTION 1.4(g)(ii).
(iii) EXONERATION. In furtherance and extension, and
not in limitation, of the specific provisions set forth above, any action taken
or omitted by the Administrative Agent or any Lender under or in connection with
the Brazilian Letter of Credit or any related certificates, if taken or omitted
in the absence of gross negligence or willful misconduct, shall not put the
Administrative Agent or any Lender under any resulting liability to the Parent
or relieve the Parent of any of its Obligations hereunder to any such Person.
(h) SUPPORTING BRAZILIAN LETTER OF CREDIT; CASH COLLATERAL. If
the Brazilian Letter of Credit is outstanding upon the termination of this
Agreement or, if sooner, thirty (30) days prior to the Stated Termination Date,
the Parent shall then deposit with the Administrative Agent, for the ratable
benefit of the Administrative Agent and the Lenders, with respect to the
Brazilian Letter of Credit then outstanding, as the Administrative Agent, in its
sole discretion shall specify, either (i) a standby letter of credit (a
"Brazilian Supporting Letter of Credit") in form and substance satisfactory to
the Administrative Agent, issued by an issuer satisfactory to the Administrative
Agent in an amount equal to the greatest amount for which the Brazilian
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Letter of Credit may be drawn plus any fees and expenses associated with the
Brazilian Letter of Credit, under which Brazilian Supporting Letter of Credit
the Administrative Agent is entitled to draw amounts necessary to reimburse the
Administrative Agent and the Lenders for payments made by the Administrative
Agent and the Lenders under the Brazilian Letter of Credit and any fees and
expenses associated with the Brazilian Letter of Credit, or (ii) cash deposits
to the Letter of Credit Cash Collateral Account in amounts necessary to
reimburse the Administrative Agent and the Lenders for payments made by the
Administrative Agent or the Lenders under the Brazilian Letter of Credit and any
fees and expenses associated with the Brazilian Letter of Credit and all other
actual or anticipated Brazilian Letter of Credit Obligations. Such Brazilian
Supporting Letter of Credit or deposit to the Letter of Credit Cash Collateral
Account shall be held by the Administrative Agent, for the ratable benefit of
the Administrative Agent and the Lenders, as security for, and to provide for
the payment of, the aggregate undrawn amount of the Brazilian Letter of Credit
remaining outstanding and all other Brazilian Letter of Credit Obligations.
1.5 OTHER LETTERS OF CREDIT.
(a) AGREEMENT TO ISSUE OR CAUSE TO ISSUE. Subject to the terms
and conditions of this Agreement, the Administrative Agent agrees (i) to cause
the Letter of Credit Issuer to issue for the account of the Parent or the UK
Borrowers one or more commercial/documentary and standby letters of credit other
than the Brazilian Letter of Credit (each such other letter of credit, a "Letter
of Credit"), and/or (ii) to provide credit support or other enhancement to a
Letter of Credit Issuer acceptable to the Administrative Agent which issues a
Letter of Credit for the account of the Parent or the UK Borrowers (any such
credit support or enhancement being herein referred to as a "Credit Support")
from time to time during the term of this Agreement.
(b) AMOUNTS; OUTSIDE EXPIRATION DATE. The Administrative Agent
shall not have any obligation to issue or cause to be issued any Letter of
Credit or to provide Credit Support for any Letter of Credit at any time if: (i)
the maximum stated amount of any requested US Letter of Credit is greater than
the Unused US Letter of Credit Subfacility at such time or the maximum stated
amount of any requested UK Letter of Credit is greater than the Unused UK Letter
of Credit Subfacility at such time; (ii) the maximum undrawn stated amount of
any requested US Letter of Credit and all commissions, fees, and charges due
from the Parent in connection with the opening thereof exceeds the US
Availability at such time or the maximum undrawn stated amount of any requested
UK Letter of Credit and all commissions, fees and charges due from the UK
Borrowers in connection with the opening thereof exceeds the UK Availability at
such time; or (iii) such Letter of Credit has an expiration date less than 30
days prior to the Stated Termination Date or more than 12 months from the date
of issuance for standby letters of credit and 180 days for documentary letters
of credit. With respect to any Letter of Credit which contains any "evergreen"
or automatic renewal provision, each Lender shall be deemed to have consented to
any such extension or renewal unless any such Lender shall have provided to the
Administrative Agent, written notice that it declines to consent to any such
extension or renewal at least thirty (30) days prior to the date on which the
Letter of Credit Issuer is entitled to decline to extend or renew the Letter of
Credit. If all of the requirements of this SECTION 1.5 are met and no Default or
Event of Default has occurred and is continuing, no Lender shall decline to
consent to any such extension or renewal.
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(c) OTHER CONDITIONS. In addition to the satisfaction of the
conditions precedent contained in ARTICLE 8, the obligation of the
Administrative Agent to issue or to cause to be issued any Letter of Credit or
to provide Credit Support for any Letter of Credit is subject to the following
conditions precedent having been satisfied in a manner reasonably satisfactory
to the Administrative Agent:
(i) The Parent or the UK Borrower, as applicable,
shall have delivered to the Letter of Credit Issuer, at such times and in such
manner as such Letter of Credit Issuer may prescribe, an application in form and
substance satisfactory to such Letter of Credit Issuer and reasonably
satisfactory to the Administrative Agent for the issuance of the Letter of
Credit and such other documents as may be required pursuant to the terms
thereof, and the form and terms of the proposed Letter of Credit shall be
reasonably satisfactory to the Administrative Agent and the Letter of Credit
Issuer; and
(ii) As of the date of issuance, no order of any
court, arbitrator or Governmental Authority shall purport by its terms to enjoin
or restrain money center banks generally from issuing letters of credit of the
type and in the amount of the proposed Letter of Credit, and no law, rule or
regulation applicable to money center banks generally and no request or
directive (whether or not having the force of law) from any Governmental
Authority with jurisdiction over money center banks generally shall prohibit, or
request that the proposed Letter of Credit Issuer refrain from, the issuance of
letters of credit generally or the issuance of such Letters of Credit.
(d) ISSUANCE OF LETTERS OF CREDIT.
(i) REQUEST FOR ISSUANCE. The Parent or the UK
Borrower, as applicable, must notify the Administrative Agent at the Applicable
Notice Office of a requested Letter of Credit at least three (3) Business Days
in the case of the Parent, and four (4) Business Days in the case of the UK
Borrowers, prior to the proposed issuance date. Such notice shall be irrevocable
and must specify the original face amount of the Letter of Credit requested, the
Business Day of issuance of such requested Letter of Credit, whether such Letter
of Credit may be drawn in a single or in partial draws, the Business Day on
which the requested Letter of Credit is to expire, the purpose for which such
Letter of Credit is to be issued, and the beneficiary of the requested Letter of
Credit. The Parent or the UK Borrower, as applicable, shall attach to such
notice the proposed form of the Letter of Credit.
(ii) RESPONSIBILITIES OF THE ADMINISTRATIVE AGENT;
ISSUANCE. As of the Business Day immediately preceding the requested issuance
date of the Letter of Credit, the Administrative Agent shall determine the
amount of the applicable Unused US Letter of Credit Subfacility and US
Availability or Unused UK Letter of Credit Subfacility and UK Availability. If
(i) the face amount of the requested Letter of Credit is less than the
applicable Unused US Letter of Credit Subfacility or the Unused UK Letter of
Credit Subfacility and (ii) the amount of such requested Letter of Credit and
all commissions, fees, and charges due from the Borrowers in connection with the
opening thereof would not exceed the US Availability or UK Availability, as
applicable, the Administrative Agent shall cause the Letter of Credit Issuer to
issue the requested Letter of Credit on the requested issuance date so long as
the other conditions hereof are met.
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(iii) NO EXTENSIONS OR AMENDMENT. The Administrative
Agent shall not be obligated to cause the Letter of Credit Issuer to extend or
amend any Letter of Credit issued pursuant hereto unless the requirements of
this SECTION 1.5 are met as though a new Letter of Credit were being requested
and issued.
(e) PAYMENTS PURSUANT TO LETTERS OF CREDIT.
Each of the Parent and the UK Borrowers agree to
reimburse immediately the Letter of Credit Issuer for any draw under any Letter
of Credit for its account and the Administrative Agent for the account of the
Lenders upon any payment pursuant to any Credit Support, and to pay the Letter
of Credit Issuer the amount of all other charges and fees payable to the Letter
of Credit Issuer in connection with any applicable Letter of Credit immediately
when due, irrespective of any claim, setoff, defense or other right which the
Parent or the UK Borrowers, as applicable, may have at any time against the
Letter of Credit Issuer or any other Person. Each drawing under any Letter of
Credit shall constitute a request by the applicable Borrower to the
Administrative Agent for a Borrowing of a Base Rate Revolving Loan to be
assessed against the US Revolving Loans or the UK Revolving Loans, as
applicable, in the amount of such drawing. The Funding Date with respect to such
Borrowing shall be the date of such drawing.
(f) COMPENSATION FOR LETTERS OF CREDIT.
(i) LETTER OF CREDIT FEE. Each of the Borrowers
agrees to pay to the Administrative Agent with respect to any Letters of Credit,
for the account of the Lenders, the Letter of Credit Fee specified in, and in
accordance with the terms of SECTION 2.7 (Letter of Credit Fee).
(ii) LETTER OF CREDIT ISSUER FEES AND CHARGES. Each
of the Borrowers shall pay to the Administrative Agent, for the account of the
Letter of Credit Issuer, the standard fees of the Letter of Credit Issuer for
issuing, administering, amending, renewing, paying and canceling Letters of
Credit and all other fees associated with issuing and servicing Letters of
Credit, as and when assessed.
(g) INDEMNIFICATION; EXONERATION; POWER OF ATTORNEY
(i) INDEMNIFICATION. In addition to amounts payable
as elsewhere provided in this SECTION 1.5, the Parent and the UK Borrowers agree
to protect, indemnify, pay and save the Lenders and the Administrative Agent
harmless from and against any and all claims, demands, liabilities, damages,
losses, costs, charges and expenses (including reasonable attorneys' fees) which
any Lender or the Administrative Agent (other than the Bank in its capacity as
Letter of Credit Issuer) may incur or be subject to as a consequence, direct or
indirect, of the issuance of any Letter of Credit, limited in the case of the UK
Borrowers to Letters of Credit issued for their account, or the provision of any
Credit Support or enhancement in connection therewith. The Parent's and the UK
Borrowers' obligations under this SECTION 1.5(g)(1) shall survive payment of all
other Obligations.
(ii) ASSUMPTION OF RISK BY THE BORROWERS. As among
the Parent and the UK Borrowers, the Lenders, and the Administrative Agent, the
Parent and the UK
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Borrowers, as applicable, assume all risks of the acts and omissions of, or
misuse of any of the Letters of Credit by, the respective beneficiaries of such
Letters of Credit. In furtherance and not in limitation of the foregoing, the
Lenders and the Administrative Agent shall not be responsible for: (A) the form,
validity, sufficiency, accuracy, genuineness or legal effect of any document
submitted by any Person in connection with the application for and issuance of
and presentation of drafts with respect to any of the Letters of Credit, even if
it should prove to be in any or all respects invalid, insufficient, inaccurate,
fraudulent or forged; (B) the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign any Letter of
Credit or the rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason; (C) the
failure of the beneficiary of any Letter of Credit to comply duly with
conditions required in order to draw upon such Letter of Credit; (D) errors,
omissions, interruptions, or delays in transmission or delivery of any messages,
by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher;
(E) errors in interpretation of technical terms; (F) any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under any Letter of Credit or of the proceeds thereof; (G) the misapplication by
the beneficiary of any Letter of Credit of the proceeds of any drawing under
such Letter of Credit; (H) any consequences arising from causes beyond the
control of the Lenders or the Administrative Agent, including any act or
omission, whether rightful or wrongful, of any present or future DE JURE or DE
FACTO Governmental Authority or (I) the Letter of Credit Issuer's honor of a
draw for which the draw or any certificate fails to comply in any respect with
the terms of the Letter of Credit. None of the foregoing shall affect, impair or
prevent the vesting of any rights or powers of the Administrative Agent or any
Lender under this SECTION 1.5(g).
(iii) EXONERATION. Without limiting the foregoing, no
action or omission whatsoever by the Administrative Agent or any Lender
(excluding any Lender in its capacity as a Letter of Credit Issuer) shall result
in any liability of the Administrative Agent or and Lender to the Parent or the
UK Borrowers, or relieve the Parent or the UK Borrowers of any of their
obligations hereunder to any such Person.
(iv) RIGHTS AGAINST LETTER OF CREDIT ISSUER. Nothing
contained in this Agreement is intended to limit the Parent's or the UK
Borrowers' rights, if any, with respect to the Letter of Credit Issuer which
arise as a result of the letter of credit application and related documents
executed by and between any such Parent or the UK Borrowers and the Letter of
Credit Issuer.
(v) INDEMNIFICATION BY LENDERS. To the extent not
reimbursed by the Parent or the UK Borrowers, as applicable, and without
limiting the obligations of the Borrowers hereunder, the Lenders agree to
indemnify the Letter of Credit Issuer ratably in accordance with their
respective Pro Rata Shares, for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses (including
reasonable attorneys' fees) or disbursements of any kind and nature whatsoever
that may be imposed on, incurred by or asserted against the Letter of Credit
Issuer in any way relating to or arising out of any Letter of Credit or the
transactions contemplated thereby or any action taken or omitted by the Letter
of Credit Issuer under any Letter of Credit or any Loan Document in connection
therewith; PROVIDED that no Lender shall be liable for any of the foregoing to
the extent it arises from the gross negligence or willful misconduct of the
Person to be indemnified. Without limitation of
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the foregoing, each Lender agrees to reimburse the Letter of Credit Issuer
promptly upon demand for its Pro Rata Share of any costs or expenses payable by
the Borrowers to the Letter of Credit Issuer, to the extent that the Letter of
Credit Issuer is not promptly reimbursed for such costs and expenses by the
Parent or the UK Borrowers. The agreement contained in this Section shall
survive payment in full of all other Obligations.
(vi) ACCOUNT PARTY. The Parent and the UK Borrowers
each hereby authorize and direct any Letter of Credit Issuer to name the
applicable Borrower as the "Account Party" therein and to deliver to the
Administrative Agent all instruments, documents and other writings and property
received by the Letter of Credit Issuer pursuant to the Letter of Credit, and to
accept and rely upon the Administrative Agent's instructions and agreements with
respect to all matters arising in connection with the Letter of Credit or the
application therefor.
(h) SUPPORTING LETTER OF CREDIT. If, notwithstanding the
provisions of SECTION 1.5(b) and SECTION 10.1, any Letter of Credit or Credit
Support is outstanding upon the termination of this Agreement, then upon such
termination the Parent or the UK Borrowers, as applicable, shall deposit with
the Administrative Agent, for the ratable benefit of the Administrative Agent
and the Lenders, with respect to each Letter of Credit or Credit Support then
outstanding, a standby letter of credit (a "Supporting Letter of Credit") in
form and substance satisfactory to the Administrative Agent, issued by an issuer
reasonably satisfactory to the Administrative Agent in an amount equal to the
greatest amount for which such Letter of Credit or such Credit Support may be
drawn plus any fees and expenses associated with such Letter of Credit or such
Credit Support, under which Supporting Letter of Credit the Administrative Agent
is entitled to draw amounts necessary to reimburse the Administrative Agent and
the Lenders for payments to be made by the Administrative Agent and the Lenders
under such Letter of Credit or Credit Support and any fees and expenses
associated with such Letter of Credit or Credit Support. Such Supporting Letter
of Credit shall be held by the Administrative Agent, for the ratable benefit of
the Administrative Agent and the Lenders, as security for, and to provide for
the payment of, the aggregate undrawn amount of such Letters of Credit or such
Credit Support remaining outstanding.
1.6 PARTICIPATIONS IN BRAZILIAN LETTER OF CREDIT
(a) PURCHASE OF PARTICIPATIONS. Immediately upon the issuance
of the Brazilian Letter of Credit and upon the issuance of any other Letters of
Credit in accordance with ARTICLE 1 (Loans and Letters of Credit), each Lender
shall be deemed to have irrevocably and unconditionally purchased and received
without recourse or warranty, an undivided interest and participation in the
Brazilian Letter of Credit and any other Letters of Credit equal to such
Lender's Pro Rata Share of the stated amount of the Brazilian Letter of Credit
and the stated amount of any such other Letters of Credit (including, without
limitation, all obligations of any of the Borrowers with respect thereto, and
any security therefor or guaranty pertaining thereto).
(b) SHARING OF REIMBURSEMENT OBLIGATION PAYMENTS. Whenever the
Administrative Agent receives a payment from the Borrowers on account of the
reimbursement obligations in respect of the Brazilian Letter of Credit or any
other Letters of Credit as to which the Administrative Agent has previously
received payment from a Lender pursuant to ARTICLE 1 (Loans and Letters of
Credit), the Administrative Agent shall promptly pay to such Lender
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such Lender's Pro Rata Share of such payment from the Borrowers in the currency
received. Each such payment shall be made by the Administrative Agent on the
Business Day on which the Administrative Agent receives immediately available
funds paid to such Person pursuant to the immediately preceding sentence, if
received prior to 11:00 a.m. (prevailing time in the location of the Appropriate
Payment Office) on such Business Day and otherwise on the next succeeding
Business Day.
(c) DOCUMENTATION. Upon the request of any Lender, the
Administrative Agent shall furnish to such Lender copies of the Loan Documents
relating to the Brazilian Letter of Credit and any other Letters of Credit.
(d) OBLIGATIONS IRREVOCABLE. The obligations of each Lender to
make payments to the Administrative Agent with respect to the Brazilian Letter
of Credit and any other Letters of Credit, and the obligations of the Borrowers
to make payments to the Administrative Agent, for the account of the Lenders,
shall be irrevocable, not subject to any qualification or exception whatsoever,
including, without limitation, any of the following circumstances:
(i) any lack of validity or enforceability of this
Agreement or any of the other Loan Documents;
(ii) the existence of any claim, setoff, defense or
other right which any of the Borrowers may have at any time against any Person,
including (without limitation) any beneficiary named in the Brazilian Letter of
Credit or any other Letter of Credit or any transferee of the Brazilian Letter
of Credit or any other Letter of Credit (or any Person for whom any such
transferee may be acting), any Lender, the Administrative Agent, or any other
Person, whether in connection with this Agreement, the Brazilian Letter of
Credit or any other Letter of Credit, the transactions contemplated herein or
any unrelated transactions (including any underlying transactions between any of
the Borrowers or any other Person);
(iii) any draft, certificate or any other document
presented under the Brazilian Letter of Credit or any other Letter of Credit
proving to be forged, fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect;
(iv) the surrender or impairment of any security for
the performance or observance of any of the terms of any of the Loan Documents;
or
(v) the occurrence of any Default or Event of
Default.
(e) RECOVERY OR AVOIDANCE OF PAYMENTS. In the event any
payment by or on behalf of the Parent or the UK Borrowers received by the
Administrative Agent with respect to the Brazilian Letter of Credit or any other
Letter of Credit (or any guaranty by the Borrowers or reimbursement obligation
of the Borrowers relating thereto) and distributed by the Administrative Agent
to the Lenders on account of their respective participations therein is
thereafter set aside, avoided or recovered from the Administrative Agent in
connection with any receivership, liquidation or bankruptcy proceeding, the
Lenders shall, upon demand by the Administrative Agent, pay to the
Administrative Agent their respective Pro Rata Shares of such amount set aside,
avoided or recovered, together with interest at the rate required to be paid by
the Administrative Agent upon the amount required to be repaid by it.
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1.7 BANK PRODUCTS.
The Borrowers may request and the Bank may, in its sole and
absolute discretion, arrange for the Borrowers to obtain from the Bank, or the
Bank's Affiliates, Bank Products although the Borrowers are not required to do
so. If Bank Products are provided by an Affiliate of the Bank, the Borrowers
agree to indemnify and hold the Bank and the Lenders harmless from any and all
costs and obligations now or hereafter incurred by the Bank or any of the
Lenders which arise from any indemnity given by the Bank to its Affiliates
related to such Bank Products; PROVIDED, HOWEVER, nothing contained herein is
intended to limit the Borrowers' rights, with respect to the Bank or its
Affiliates, if any, which arise as a result of the execution of documents by and
between the Borrowers and the Bank which relate to Bank Products. The agreement
contained in this Section shall survive termination of this Agreement. The
Borrowers acknowledge and agree that the obtaining of Bank Products from the
Bank or the Bank's Affiliates (a) is in the sole and absolute discretion of the
Bank or the Bank's Affiliates, and (b) is subject to all rules and regulations
of the Bank or the Bank's Affiliates.
1.8 LOAN ACCOUNT. The Administrative Agent shall record the principal
amount of the Loans owing to each Lender, the undrawn face amount of the
Brazilian Letter of Credit and all other outstanding Letters of Credit and the
aggregate amount of unpaid reimbursement obligations outstanding with respect to
the Brazilian Letter of Credit and all other Letters of Credit from time to time
on its books. In addition, each Lender may note the date and amount of each
payment or prepayment of principal of such Lender's Loans in its books and
records. Such books and records shall constitute rebuttably presumptive
evidence, absent manifest error, of the accuracy of the information contained
therein. Failure by the Administrative Agent or any Lender to make such notation
shall not affect the Obligations of the Borrowers with respect to the Loans, the
Brazilian Letter of Credit or the Letters of Credit.
ARTICLE 2
INTEREST AND FEES
-----------------
2.1 INTEREST.
(a) INTEREST RATES. All outstanding Obligations shall bear
interest on the unpaid principal amount thereof (including, to the extent
permitted by law, on interest thereon not paid when due) from the date made
until paid in full in cash at a rate determined by reference to the Base Rate or
the LIBOR Rate PLUS the Applicable Margins, but not to exceed the Maximum Rate.
Each change in the Base Rate shall be reflected in the interest rate applicable
to Base Rate Loans as of the effective date of such change. All interest charges
shall be computed on the basis of a year of 360 days and actual days elapsed
(which results in more interest being paid than if computed on the basis of a
365-day year). The applicable Borrowers shall pay to the Administrative Agent,
for the ratable benefit of Lenders, interest accrued on all Base Rate Loans in
arrears on the first day of each month hereafter and on the Termination Date.
The applicable Borrowers shall pay to the Administrative Agent, for the ratable
benefit of Lenders, interest on all LIBOR Rate Loans in arrears on each LIBOR
Interest Payment Date.
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(b) DEFAULT RATE. During the continuance of a Default or Event
of Default, no Borrower may elect to have a Revolving Loan converted into or
continued as a LIBOR Rate Revolving Loan and the Default Rate shall apply at the
option of the Required Lenders.
(c) TERM LOANS. Notwithstanding any other provision of this
Agreement, the Term Loans shall be initially extended as Base Rate Loans but
shall be requested to be converted to LIBOR Rate Loans no later than (4)
Business Days, to be effective no more than seven (7) days following the date on
which the Term Loans are funded and shall remain LIBOR Rate Loans at all times
thereafter unless the Lenders agree otherwise.
2.2 CONTINUATION AND CONVERSION ELECTIONS.
(a) THE BORROWERS MAY:
(i) elect, as of any Business Day, in the case of
Base Rate Loans, to convert any Base Rate Loans or any part thereof in
an amount not less than $1,000,000 for US Revolving Loans or
(pound)100,000 for UK Revolving Loans (and increments of $500,000 and
(pound)100,000, respectively), or the Foreign Currency Equivalent
thereof, into LIBOR Rate Loans; or
(ii) elect, as of the last day of the applicable
Interest Period, to continue any LIBOR Rate Loans which have Interest
Periods expiring on such day, or any part thereof in an amount not less
than $1,000,000 for US Revolving Loans or (pound)100,000 for UK
Revolving Loans (and increments of $500,000 and (pound)100,000,
respectively), or the Foreign Currency Equivalent thereof;
PROVIDED, that if at any time the aggregate amount of LIBOR Rate Loans in
respect of any Borrowing is reduced, by payment, prepayment, or conversion of
part thereof to be less than $1,000,000 for US Revolving Loans of (pound)100,000
for UK Revolving Loans, or the Foreign Currency Equivalent thereof, such LIBOR
Rate Loans shall, subject to SECTION 1.2(e)(iii), automatically convert into
Base Rate Loans (to the extent the Base Rate is available for such LIBOR Rate
Loans), and on and after such date the right of the Borrowers to continue such
Loans as, and convert such Loans into, LIBOR Rate Loans, as the case may be,
shall terminate, and provided further that if the notice shall fail to specify
the duration of the Interest Period, such Interest Period shall be one month.
(b) The Borrowers shall deliver a notice of
continuation/conversion ("Notice of Continuation/Conversion") to the
Administrative Agent not later than 12:00 noon (prevailing time in the location
of the Appropriate Notice Office) at least three (3) Business Days in advance of
the Continuation/Conversion Date, if the Loans are to be converted into or
continued as LIBOR Rate Loans and specifying:
(i) the proposed Continuation/Conversion Date;
(ii) the aggregate amount of Loans to be converted or
renewed;
(iii) the currency of Loans to be converted or
renewed;
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(iv) the type of Loans resulting from the proposed
conversion or continuation; and
(v) the duration of the requested Interest Period,
PROVIDED, HOWEVER, the Borrowers may not select an Interest Period that ends
after the Stated Termination Date.
(c) If upon the expiration of any Interest Period applicable
to LIBOR Revolving Loans, the Borrowers have failed to select timely a new
Interest Period to be applicable to such LIBOR Revolving Loans or if any Default
or Event of Default then exists, subject to SECTION 1.2(e)(iii), the Borrowers
shall be deemed to have elected to convert such LIBOR Revolving Loans into Base
Rate Loans effective as of the expiration date of such Interest Period.
(d) If upon the expiration of any Interest Period applicable
to a Term Loan that is a LIBOR Rate Loan, the Borrowers have failed to select
timely a new Interest Period to be applicable to such LIBOR Rate Loan, the
Borrowers shall be deemed to have elected, effective as of the expiration date
of such Interest Period, an Interest Period of one month.
(e) The Administrative Agent will promptly notify each Lender
of its receipt of a Notice of Continuation/Conversion. All conversions and
continuations shall be made ratably according to the respective outstanding
principal amounts of the Loans with respect to which the notice was given held
by each Lender.
2.3 MAXIMUM INTEREST RATE. In no event shall any interest rate provided
for hereunder exceed the maximum rate legally chargeable by any Lender under
applicable law for such Lender with respect to loans of the type provided for
hereunder (the "Maximum Rate"). If, in any month, any interest rate, absent such
limitation, would have exceeded the Maximum Rate, then the interest rate for
that month shall be the Maximum Rate, and, if in future months, that interest
rate would otherwise be less than the Maximum Rate, then that interest rate
shall remain at the Maximum Rate until such time as the amount of interest paid
hereunder equals the amount of interest which would have been paid if the same
had not been limited by the Maximum Rate. In the event that, upon payment in
full of the Obligations, the total amount of interest paid or accrued under the
terms of this Agreement is less than the total amount of interest which would,
but for this SECTION 2.3, have been paid or accrued if the interest rate
otherwise set forth in this Agreement had at all times been in effect, then the
Borrowers shall, to the extent permitted by applicable law, pay the
Administrative Agent, for the account of the Lenders, an amount equal to the
excess of (a) the lesser of (i) the amount of interest which would have been
charged if the Maximum Rate had, at all times, been in effect or (ii) the amount
of interest which would have accrued had the interest rate otherwise set forth
in this Agreement, at all times, been in effect over (b) the amount of interest
actually paid or accrued under this Agreement. If a court of competent
jurisdiction determines that the Administrative Agent and/or any Lender has
received interest and other charges hereunder in excess of the Maximum Rate,
such excess shall be deemed received on account of, and shall automatically be
applied to reduce, the Obligations other than interest, in the inverse order of
maturity, and if there are no Obligations outstanding, the Administrative Agent
and/or such Lender shall refund to the Borrowers such excess.
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2.4 CLOSING FEE.
Borrowers, as they may allocate among themselves, agree to pay the
Administrative Agent, for the account of the Lenders, in accordance with their
respective Pro Rata Share on the Closing Date a closing fee (the "Closing Fee")
in the amount of $425,000, which Closing Fee shall be fully earned by the
Lenders on the Closing Date. The Administrative Agent, the Lenders and the
Borrowers agree that the Closing Fee shall be financed by the Lenders as a
Revolving Loan charged to the US Revolving Loans.
2.5 UNUSED LINE FEE.
On the first day of each month and on the Termination Date, each of (a)
Parent and (b) UK Holdco and Unifrax UK agree to pay to the Administrative
Agent, for the account of the Lenders, in accordance with their respective Pro
Rata Shares of the US Revolving Loans and the UK Revolving Loans, respectively,
an unused line fee (the "Unused Line Fee") as follows:
Parent shall pay an unused line fee (the "US Unused Line Fee") equal to
the Applicable Margin for Unused Line Fees times the amount by which the Maximum
US Revolving Loans Amount exceeded the average daily outstanding amount of US
Revolving Loans and the average daily outstanding amount of the US Letter of
Credit Obligations and the average daily Brazilian Letter of Credit Reserve
during the immediately preceding month or shorter period if calculated on the
Termination Date.
The UK Borrowers shall pay an unused line fee (the "UK Unused Line
Fee") equal to the Applicable Margin for Unused Line Fees times the amount by
which the Maximum UK Revolving Loans Amount exceeded the sum of the average
daily outstanding amount of UK Revolving Loans and the average daily outstanding
amount of the UK Letter of Credit Obligations during the immediately preceding
month or shorter period if calculated on the Termination Date.
The Unused Line Fee shall be computed on the basis of a 360-day year
for the actual number of days elapsed. All payments received by the
Administrative Agent shall be deemed to be credited to the applicable Borrower's
Loan Account immediately upon receipt for purposes of calculating the Unused
Line Fee pursuant to this SECTION 2.5.
2.6 BRAZILIAN LETTER OF CREDIT FEE. The Parent agrees to pay to (a) the
Administrative Agent, for the ratable account of the applicable Lenders, a
letter of credit fee (the "Brazilian Letter of Credit Fee") equal to the sum of
(i) the Applicable Margin (based on and multiplied by the amount by which the
undrawn stated amount of the Brazilian Letter of Credit exceeds the amount of
the sum of the Brazilian Letter of Credit Reserve plus the amount of deposit in
the Brazilian Letter of Credit Cash Collateral Account), and (ii) the Applicable
Margin (based on and multiplied by the sum amount of the Brazilian Letter of
Credit Reserve plus the amount of deposit in the Brazilian Letter of Credit Cash
Collateral Account), and (b) for the benefit of the Letter of Credit Issuer a
fronting fee of one-eighth of one percent (0.125%) per annum of the undrawn face
amount of the Brazilian Letter of Credit, and (c) to the Letter of Credit
Issuer, all out-of-pocket costs, fees and expenses incurred by the Letter of
Credit Issuer in connection with the application for, processing of, issuance
of, or amendment to the Brazilian Letter of Credit and
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all other fees under this SECTION 2.6. The Brazilian Letter of Credit Fee shall
be payable monthly in arrears on the first day of each month following any month
in which a Brazilian Letter of Credit was issued and/or in which the Brazilian
Letter of Credit remains outstanding. The Brazilian Letter of Credit Fee shall
be computed on the basis of a 360-day year for the actual number of days
elapsed.
2.7 LETTER OF CREDIT FEE. The Borrowers agree to pay to (a) the
Administrative Agent, for the account of the Lenders, in accordance with their
respective Pro Rata Shares, for each Letter of Credit, a fee (the "Letter of
Credit Fee") equal to the Applicable Margin, and (b) to Administrative Agent for
the benefit of the Letter of Credit Issuer a fronting fee of one-eighth of one
percent (0.125%) per annum of the undrawn face amount of each Letter of Credit,
and (c) to the Letter of Credit Issuer, all out-of-pocket costs, fees and
expenses incurred by and customary charges of the Letter of Credit Issuer in
connection with the application for, processing of, issuance of, or amendment to
any Letter of Credit. The Letter of Credit Fee shall be payable monthly in
arrears on the first day of each month following any month in which a Letter of
Credit is outstanding and on the Termination Date. The Letter of Credit Fee
shall be computed on the basis of a 360-day year for the actual number of days
elapsed.
2.8 COLLATERAL ADMINISTRATION FEE.
The Parent agrees to pay to the Administrative Agent, for its
sole account, a collateral administration fee (collectively, the "Collateral
Administration Fee" and individually a "Collateral Administration Fee") of
$35,000, which Collateral Administration Fee shall be paid on the Closing Date
and on each Anniversary Date until all Obligations arising out of, or under, the
Total Facility have been paid in full. The entire amount of the Collateral
Administration Fee may be advanced by the Administrative Agent as a US Revolving
Loan.
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ARTICLE 3
PAYMENTS AND PREPAYMENTS
------------------------
3.1 REVOLVING LOANS. The Parent under SECTION 1.2 (Revolving Loans)
shall repay the outstanding principal balance of the US Revolving Loans, plus
all accrued but unpaid interest thereon, on the Termination Date. The UK
Borrowers under SECTION 1.2 (Revolving Loans) shall repay the outstanding
principal balance of the UK Revolving Loans, plus all accrued but unpaid
interest thereon, on the Termination Date. The Borrowers may prepay Revolving
Loans at any time, and reborrow subject to the terms of this Agreement;
PROVIDED, HOWEVER, that with respect to any LIBOR Revolving Loans prepaid by the
Borrowers prior to the expiration date of the Interest Period applicable
thereto, the Borrowers shall pay to the Administrative Agent for account of the
Lenders the amounts described in SECTION 4.4. In addition, and without limiting
the generality of the foregoing, upon demand the Parent shall pay to the
Administrative Agent, for account of the applicable Lenders, the amount (without
duplication) by which the Aggregate US Revolving Loans Outstandings exceeds the
US Borrowing Base, and the UK Borrowers shall pay to the Administrative Agent,
for account of the applicable Lenders, the amount (without duplication) by which
the Aggregate UK Revolving Loans Outstandings exceeds the UK Borrowing Base.
3.2 REPAYMENT OF THE TERM LOANS. The applicable Borrowers agree to
repay the principal of the Term Loans to the Administrative Agent, for the
account of the Lenders as set forth in SECTION 1.3 (Term Credit Facilities).
3.3 PREPAYMENTS OF THE TERM LOANS.
(a) The Borrowers may prepay the principal of the Term Loans
in whole or in part, at any time and from time to time upon at least five (5)
Business Days' prior written notice (which shall include a notice as to which
Term Loan is being prepaid) to the Administrative Agent. All voluntary
prepayments of the principal of the Term Loans shall be accompanied by the
payment of all accrued but unpaid interest on the Term Loans being repaid to the
date of prepayment. Any voluntary prepayment of less than all of the outstanding
principal of the Term Loans shall be applied to the installments of principal of
the Term Loans being repaid in the inverse order of maturity. Amounts prepaid in
respect of the Term Loans may not be reborrowed. Notwithstanding the foregoing,
the Term Loan (UK) may not be the subject of a voluntary prepayment at any time
when there is any amount outstanding under the UK Revolving Loans.
(b) Immediately upon receipt by the Borrowers or any of their
Subsidiaries of proceeds of any asset disposition (excluding proceeds of asset
dispositions permitted by SECTION 7.9 and subject to the provisions of SECTION
7.9) or any sale of the stock of any Subsidiary of the Parent (other than to the
Parent or to another Subsidiary, except that the stock of any Subsidiary that is
a Borrower may only be sold to another Borrower), the applicable Borrower shall
prepay the Term Loans in an amount equal to all such proceeds, net of (A)
commissions and other reasonable and customary transaction costs, fees and
expenses properly attributable to such transaction and payable by the Borrowers
in connection therewith (in each case, paid to non-Affiliates), (B) transfer
taxes, (C) amounts payable to holders of senior
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Liens (to the extent such Liens constitute Permitted Liens hereunder), if any,
and (D) an appropriate reserve for taxes in accordance with GAAP in connection
therewith ("Net Proceeds"). Any such prepayment shall be applied in accordance
with SECTION 3.3(c).
(c) Prepayments in accordance with SECTION 3.3(b) shall be
applied as follows: Proceeds of Accounts and Inventory of the Parent or an
amount equal to the book value of Accounts and Inventory sold as part of a sale
of a division or by means of the sale of the stock of a Subsidiary of the Parent
shall be applied, FIRST, to accrued interest with respect to the US Revolving
Loans and, SECOND, to pay the principal of the US Revolving Loans. Proceeds of
Accounts and Inventory of the UK Borrowers or an amount equal to the book value
of Accounts and Inventory sold as part of a sale of a division or by means of
the sale of the stock of a Subsidiary of the UK Borrowers shall be applied,
FIRST, to accrued interest with respect to the UK Revolving Loans and, SECOND,
to pay the principal of the UK Revolving Loans. Proceeds of all other assets,
including proceeds from the sale of a division or a Subsidiary in excess of the
book value of Accounts and Inventory sold as part of the sale of that division
or Subsidiary, shall be applied, FIRST, to accrued interest with respect to the
Term Loans made to the relevant Borrower, SECOND, to scheduled installments of
the Term Loans made to the relevant Borrower in inverse order of maturity,
THIRD, to accrued interest with respect to any Term Loans, and, FOURTH, to
scheduled installments of any Term Loans in inverse order of maturity.
3.4 LIBOR RATE LOAN PREPAYMENTS. In the event that any Borrower would
be required to make a mandatory prepayment with respect to any Term Loan prior
to the expiration of Interest Period, the applicable Borrower shall deliver the
funds required to be prepaid to the Administrative Agent and may request, in the
absence of the continuance of a Event of Default, that the Administrative Agent
deposit such funds into an account over which the Administrative Agent has sole
control (which deposit shall secure the Obligations) and shall not apply such
funds until the expiration of the next expiring Interest Period. If, despite the
foregoing, in connection with any prepayment, if any LIBOR Rate Loans are
prepaid prior to the expiration date of the Interest Period applicable thereto,
the Borrowers shall pay to the Lenders the amounts described in SECTION 4.4;
provided, however, that the Administrative Agent will to the extent possible
apply prepayments to Base Rate Loans.
3.5 PAYMENTS BY THE BORROWERS.
(a) All payments to be made by the Borrowers shall be made
without set-off, recoupment or counterclaim. Except as otherwise expressly
provided herein, all payments by the Borrowers shall be made to the
Administrative Agent for the account of the Lenders, at the account designated
by the Administrative Agent and shall be made in the borrowed currency and in
immediately available funds, no later than 12:00 noon (prevailing time in the
location of the Appropriate Payment Office) on the date specified herein. Any
payment received by the Administrative Agent after such time shall be deemed to
have been received on the following Business Day and any applicable interest or
fee shall continue to accrue.
(b) Subject to the provisions set forth in the definition of
"Interest Period", whenever any payment is due on a day other than a Business
Day, such payment shall be due on the following Business Day, and such extension
of time shall in such case be included in the computation of interest or fees,
as the case may be.
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3.6 PAYMENTS AS REVOLVING LOANS. At the election of Administrative
Agent, all payments of principal, interest, reimbursement obligations in
connection with Letters of Credit and Credit Support for Letters of Credit,
fees, premiums, reimbursable expenses and other sums payable hereunder, may be
paid from the proceeds of Revolving Loans made hereunder. The Borrowers hereby
irrevocably authorize the Administrative Agent to charge the Loan Account for
the purpose of paying all amounts from time to time due hereunder and agrees
that all such amounts charged shall constitute Revolving Loans (including
Non-Ratable Loans and Administrative Agent Advances). Unless the Administrative
Agent elects otherwise during the continuance of an Event of Default, such
payments from the proceeds of UK Revolving Loans will be applied only to the
Obligations of UK Holdco and Unifrax UK and proceeds of US Revolving Loans will
not be applied to the Obligations of UK Holdco and Unifrax UK.
3.7 APPORTIONMENT, APPLICATION AND REVERSAL OF PAYMENTS. Aggregate
principal and interest payments shall be apportioned ratably among the Lenders
(according to the unpaid principal balance of the Revolving Loans to which such
payments relate held by each Lender) and payments of the fees shall, as
applicable, be apportioned ratably among the Lenders, except for fees payable
solely to Administrative Agent and the Letter of Credit Issuer and except as
provided in SECTION 11.1(b). All payments shall be remitted to the
Administrative Agent and all such payments not relating to principal or interest
of specific Loans, or not constituting payment of specific fees, and all
proceeds of Accounts or other Collateral received by the Administrative Agent,
shall be applied, ratably, subject to the provisions of this Agreement, FIRST,
to pay any fees, indemnities or expense reimbursements including any amounts
relating to Bank Products then due to the Administrative Agent from the
Borrowers; SECOND, to pay any fees or expense reimbursements then due to the
Lenders from the Borrowers; THIRD, to pay interest due in respect of all
Revolving Loans (including Non-Ratable Loans and Administrative Agent Advances)
(first to US Revolving Loans and then to UK Revolving Loans); FOURTH, to pay or
prepay principal of the Non-Ratable Loans and Administrative Agent Advances;
FIFTH, to pay or prepay principal of the Revolving Loans (other than Non-Ratable
Loans and Administrative Agent Advances) and unpaid reimbursement obligations in
respect of Letters of Credit (first to US Revolving Loans and then to UK
Revolving Loans); SIXTH, to pay or prepay principal of the Term Loans (first to
Term Loan (France), second as a prepayment of the obligations under the
Brazilian Loan Documents under clause second (A) of SECTION 1.3(c) (Term Credit
Facility Mandatory Prepayments), as a deposit to the Brazilian Letter of Credit
Cash Collateral Account or as a reduction in the Brazilian Letter of Credit
Reserve, in the discretion of the Parent, if no Event of Default exists, or
otherwise, of the Administrative Agent, and then to Term Loan (UK)); and
SEVENTH, to the payment of any other Obligation including any amounts relating
to Bank Products other than amounts covered by clause FIRST above.
Notwithstanding anything to the contrary contained in this Agreement, unless so
directed by the Borrowers, or unless an Event of Default has occurred and is
continuing, neither the Administrative Agent nor any Lender shall apply any
payments which it receives to any LIBOR Rate Loan, except (a) on the expiration
date of the Interest Period applicable to any such LIBOR Rate Loan, or (b) in
the event, and only to the extent, that there are no outstanding Base Rate Loans
and, in any event, the Borrowers shall pay LIBOR breakage losses in accordance
with SECTION 4.4. The Administrative Agent and the Lenders shall have the
continuing and exclusive right to apply and reverse and reapply any and all such
proceeds and payments to any portion of the Obligations.
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3.8 INDEMNITY FOR RETURNED PAYMENTS. If, after receipt of any payment
which is applied to the payment of all or any part of the Obligations, the
Administrative Agent or any Lender is for any reason compelled to surrender such
payment or proceeds to any Person because such payment or application of
proceeds is invalidated, declared fraudulent, set aside, determined to be void
or voidable as a preference, impermissible setoff, or a diversion of trust
funds, or for any other reason, then the Obligations or part thereof intended to
be satisfied shall be revived and continued and this Agreement shall continue in
full force as if such payment or proceeds had not been received by the
Administrative Agent or such Lender and the Borrowers shall be liable to pay to
the Administrative Agent and the Lenders, and hereby does indemnify the
Administrative Agent and the Lenders and hold the Administrative Agent and the
Lenders harmless for the amount of such payment or proceeds surrendered. The
provisions of this SECTION 3.8 shall be and remain effective notwithstanding any
contrary action which may have been taken by the Administrative Agent or any
Lender in reliance upon such payment or application of proceeds, and any such
contrary action so taken shall be without prejudice to the Administrative
Agent's and the Lenders' rights under this Agreement and shall be deemed to have
been conditioned upon such payment or application of proceeds having become
final and irrevocable. The provisions of this SECTION 3.8 shall survive the
termination of this Agreement.
3.9 ADMINISTRATIVE AGENT'S AND LENDERS' BOOKS AND RECORDS; MONTHLY
STATEMENTS. The Borrowers agree that the Administrative Agent's and each
Lender's books and records showing the Obligations and the transactions pursuant
to this Agreement and the other Loan Documents shall be admissible in any action
or proceeding arising therefrom, and shall constitute rebuttably presumptive
proof thereof, irrespective of whether any Obligation is also evidenced by a
promissory note or other instrument. The Administrative Agent will provide to
the Borrowers a monthly statement of Loans, payments, and other transactions
pursuant to this Agreement. Such statement shall be deemed correct, accurate,
and binding on the Borrowers and an account stated (except for reversals and
reapplications of payments made as provided in SECTION 3.8 and corrections of
errors discovered by the Administrative Agent), unless the Borrowers notify the
Administrative Agent in writing to the contrary within thirty (30) days after
such statement is rendered. In the event a timely written notice of objections
is given by the Borrowers, only the items to which exception is expressly made
will be considered to be disputed by the Borrowers.
3.10 LIMITATIONS ON JOINT AND SEVERAL LIABILITY; CONTRIBUTION RIGHTS.
(a) Notwithstanding any provision to the contrary which may be
contained in this Agreement, the obligations and liabilities of one or more of
the Borrowers under this Agreement and any of the other Loan Documents shall be
limited as and to the extent provided in this Section:
(i) the UK Borrowers shall be liable only for payment
of the UK Obligations; and
(ii) French Holdco shall be liable only for payment
of the French Obligations; and
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(iii) the Parent shall be liable for all of the
Obligations, including, without limitation, the UK
Obligations, the French Obligations, and the Brazilian Letter
of Credit Obligations.
Consistent with the limitations on liability of the UK Borrowers and French
Holdco under this SECTION 3.10 (Limitations on Joint and Several Liability), all
Proceeds of the Collateral covered by the UK Security Documents shall be applied
only in satisfaction of the UK Obligations and Proceeds of Collateral covered by
the French Security Documents shall be applied only in satisfaction of the
French Obligations, except to the extent otherwise expressly provided in the UK
Security Documents and/or the French Security Documents.
(b) The Borrowers acknowledge that each of them benefits from
the collective financing arrangement represented by the Credit Facility extended
by the Lenders pursuant to this Agreement and the other Loan Documents. Each
Borrower shall have a right of contribution to obtain reimbursement from each
other Borrower in respect of the Obligations to the extent that such payment
exceeds the benefit realized by such Borrower from the Credit Facility. Any
right of contribution which arises as a result of payments made in respect of
the Obligations or otherwise shall be subordinate to the rights of the Lenders
and the Administrative Agent to payment and performance in full of the
Obligations.
3.11 GUARANTY OF PARENT.
(a) The Parent hereby unconditionally and irrevocably,
guarantees to the Administrative Agent and the Lenders:
(i) the due and punctual payment in full (and not
merely the collectibility) by French Holdco of the French Obligations, including
unpaid and accrued interest thereon, in each case when due and payable, all
according to the terms of this Agreement, the Term Loan Notes and the other Loan
Documents;
(ii) the due and punctual payment in full (and not
merely the collectibility) by the UK Borrowers of the UK Obligations, including
unpaid and accrued interest thereon, in each case when due and payable, all
according to the terms of this Agreement, the Term Loan Notes and the other Loan
Documents;
(iii) the due and punctual payment in full (and not
merely the collectibility) by the other Borrowers of all other sums and charges
which may at any time be due and payable in accordance with this Agreement, the
Notes or any of the other Loan Documents;
(iv) the due and punctual performance by the other
Borrowers of all of the other terms, covenants and conditions contained in the
Loan Documents; and
(v) all the other Obligations of the other Borrowers.
(b) The obligations and liabilities of the Parent as a
guarantor under this SECTION 3.11 shall be absolute and unconditional,
irrespective of the genuineness, validity, priority, regularity or
enforceability of this Agreement, any of the Notes or any of the Loan
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Documents or any other circumstance which might otherwise constitute a legal or
equitable discharge of a surety or guarantor. The Parent, in its capacity as a
guarantor (but not in its capacity as a Borrower), expressly agrees that the
Administrative Agent and the Lenders may, in their sole and absolute discretion,
without notice to or further assent of the Parent and without in any way
releasing, affecting or in any way impairing the joint and several obligations
and liabilities of the Parent as a guarantor hereunder:
(i) waive compliance with, or any defaults under, or
grant any other indulgences under or with respect to this Agreement or any of
the other Loan Documents;
(ii) modify, amend, change or terminate any
provisions of this Agreement and/or any of the other Loan Documents;
(iii) grant extensions or renewals of or with respect
to any Credit Facility, the Notes or any of the other Loan Documents;
(iv) effect any release, subordination, compromise or
settlement in connection with this Agreement, any of the Notes or any of the
other Loan Documents;
(v) agree to the substitution, exchange, release or
other disposition of the Collateral or any part thereof, or any other collateral
for any of UK Obligations and/or the French Obligations to the subordination of
any Lien therein;
(vi) make advances for the purpose of performing any
term, provision or covenant contained in this Agreement, any of the Notes or any
of the other Loan Documents with respect to which any of the other Borrowers
shall then be in default;
(vii) make future advances pursuant to this Agreement
or any of the other Loan Documents;
(viii) assign, pledge, hypothecate or otherwise
transfer the Commitments relating to the UK Obligations and/or the French
Obligations, the UK Obligations, the French Obligations, the Notes, any of the
other Loan Documents or any interest therein, all as and to the extent permitted
by the provisions of this Agreement;
(ix) deal in all respects with the other Borrowers as
if this SECTION 3.11 were not in effect;
(x) effect any release, compromise or settlement with
any of the other Borrowers, whether in their capacity as a Borrower or as a
guarantor under this SECTION 3.11, or any other guarantor; and
(xi) provide debtor-in-possession financing or allow
use of cash collateral in proceedings under the Bankruptcy Code, it being
expressly agreed by all Borrowers that any such financing and/or use would be
part of the Obligations.
(c) The obligations and liabilities of the Parent, as
guarantor under this SECTION 3.11, shall be primary, direct and immediate, shall
not be subject to any counterclaim,
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recoupment, set off, reduction or defense based upon any claim that the Parent
may have against any one or more of the other Borrowers, the Administrative
Agent, any one or more of the Lenders and/or any other guarantor and shall not
be conditional or contingent upon pursuit or enforcement by the Administrative
Agent or other Lenders of any remedies it may have against any of the Borrowers
with respect to this Agreement, the Notes or any of the other Loan Documents,
whether pursuant to the terms thereof or by operation of law. Without limiting
the generality of the foregoing, the Administrative Agent and the Lenders shall
not be required to make any demand upon any of the Borrowers, or to sell any of
the Collateral or otherwise pursue, enforce or exhaust its or their remedies
against any of the Borrowers or any of the Collateral either before,
concurrently with or after pursuing or enforcing its rights and remedies
hereunder. Any one or more successive or concurrent actions or proceedings may
be brought against the Parent under this SECTION 3.11, either in the same
action, if any, brought against any one or more of the Borrowers or in separate
actions or proceedings, as often as the Administrative Agent may deem expedient
or advisable. Without limiting the foregoing, it is specifically understood that
any modification, limitation or discharge of any of the liabilities or
obligations of any one or more of the Borrowers, any other guarantor or any
obligor under any of the Loan Documents, arising out of, or by virtue of, any
bankruptcy, arrangement, reorganization or similar proceeding for relief of
debtors under federal or state law initiated by or against any one or more of
the Borrowers, in their respective capacities as borrowers and guarantor under
this SECTION 3.11, or under any of the Loan Documents shall not modify, limit,
lessen, reduce, impair, discharge, or otherwise affect the liability of the
Parent under this SECTION 3.11 in any manner whatsoever, and this SECTION 3.11
shall remain and continue in full force and effect. It is the intent and purpose
of this SECTION 3.11 that the Parent shall and does hereby waive all rights and
benefits which might accrue to any other guarantor by reason of any such
proceeding, and the Parent agrees that it shall be liable for the full amount of
the obligations and liabilities under this SECTION 3.11, regardless of, and
irrespective to, any modification, limitation or discharge of the liability of
any one or more of the Borrowers, any other guarantor or any obligor under any
of the Loan Documents, that may result from any such proceedings.
(d) The Parent, as guarantor under this SECTION 3.11, hereby
unconditionally, irrevocably and expressly waives:
(i) presentment and demand for payment of the UK
Obligations, the French Obligations and protest of non-payment;
(ii) notice of acceptance of this SECTION 3.11 and of
presentment, demand and protest thereof;
(iii) notice of any default hereunder or under the
Notes or any of the other Loan Documents and notice of all indulgences;
(iv) notice of any increase in the amount of any
portion of or all of the indebtedness guaranteed by this SECTION 3.11;
(v) demand for observance, performance or enforcement
of any of the terms or provisions of this SECTION 3.11, the Notes or any of the
other Loan Documents;
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(vi) all errors and omissions in connection with the
Administrative Agent's administration of all indebtedness guaranteed by this
SECTION 3.11, except errors and omissions resulting from acts of bad faith;
(vii) any right or claim of right to cause a
marshalling of the assets of any one or more of the other Borrowers;
(viii) any act or omission of the Administrative
Agent or the Lenders which changes the scope of the risk as guarantor hereunder;
and
(ix) all other notices and demands otherwise required
by law which the Parent may lawfully waive.
Within ten (10) days following any request of the
Administrative Agent so to do, the Parent will furnish to the Administrative
Agent and the Lenders and such other persons as the Administrative Agent may
direct with a written certificate, duly acknowledged stating in detail whether
or not any credits, offsets or defenses exist with respect to this SECTION 3.11.
3.12 REDENOMINATION OF LOANS IN STERLING.
Each Obligation under this Agreement which is denominated in
Sterling and each advance of a US Revolving Loan or UK Revolving Loan to be made
in Sterling shall be redenominated in Euros in accordance with any applicable
EMU Legislation which may be adopted; provided, that, if and to the extent that
any EMU Legislation provides that an amount which is denominated is either the
Euro or Sterling, as a national currency unit of the Euro, may be loaned or
repaid either in the Euro or in any national currency unit of the Euro,
including Sterling, the Borrowers shall be entitled to pay the applicable
Obligations, and the Lenders shall be entitled to make any requested advance of
the US Revolving Loan or the UK Revolving Loan, in either Euros or Sterling.
Without prejudice and in addition to any method of conversion or rounding
prescribed by any EMU Legislation and without prejudice to the Obligations, each
reference in this Agreement to a minimum amount (or an integral multiple
thereof) expressed in Sterling shall be replaced by a referenced to such
reasonably comparable amount and convenient amount (in integral multiple
thereof) in Euros as the Administrative Agent may from time to time specify.
3.13 CONTRACTUAL CURRENCY.
Any amount received or recovered by the Administrative Agent
in respect of any sum expressed to be due to it (whether for itself or as
trustee for any other person) from any Borrower under this Agreement or under
any of the other Loan Documents in a currency other than the currency (the
"contractual currency") in which such sum is so expressed to be due (whether as
a result of, or of the enforcement of, any judgment or order of a court or
tribunal of any jurisdiction, the winding-up of a Borrower of otherwise) shall
only constitute a discharge of such Borrower to the extent of the amount of the
contractual currency that the Administrative Agent is able, in accordance with
its usual practice, to purchase with the amount of the currency so received or
recovered on the date of receipt or recovery (or, if later, the first date on
which such purchase is practicable). If the amount of the contractual currency
so purchased is less than
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the amount of the contractual currency so expressed to be due, such Borrower
shall indemnify the Administrative Agent against any loss sustained by it as a
result, including the cost of making any such purchase.
ARTICLE 4
TAXES, YIELD PROTECTION AND ILLEGALITY
--------------------------------------
4.1 TAXES.
(a) Any and all payments by the Borrowers to each Lender or
the Administrative Agent under this Agreement and any other Loan Document shall
be made free and clear of, and without deduction or withholding for any Taxes.
In addition, the Borrowers shall pay all Other Taxes.
(b) The Borrowers agree to indemnify and hold harmless each
Lender and the Administrative Agent for the full amount of Taxes or Other Taxes
(including any Taxes or Other Taxes imposed by any jurisdiction on amounts
payable under this Section) paid in good faith by any Lender or the
Administrative Agent and any liability (including penalties, interest, additions
to tax and expenses) arising therefrom or with respect thereto, whether or not
such Taxes or Other Taxes were correctly or legally asserted. Payment under this
indemnification shall be made within 30 days after the date such Lender or the
Administrative Agent makes written demand therefor.
(c) If the Borrowers shall be required by law to deduct or
withhold any Taxes or Other Taxes from or in respect of any sum payable
hereunder to any Lender or the Administrative Agent, then:
(i) the sum payable shall be increased as necessary
so that after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable under this
Section) such Lender or the Administrative Agent, as the case may be, receives
an amount equal to the sum it would have received had no such deductions or
withholdings been made;
(ii) the Borrowers shall make such deductions and
withholdings;
(iii) the Borrowers shall pay the full amount
deducted or withheld to the relevant taxing authority or other authority in
accordance with applicable law; and
(iv) the Borrowers shall also pay to each Lender or
the Administrative Agent for the account of such Lender, at the time interest is
paid, all additional amounts which the respective Lender specifies as necessary
to preserve the after-tax yield such Lender would have received if such Taxes or
Other Taxes had not been imposed.
(d) At the Administrative Agent's request, within 30 days
after the date of any payment by the Borrowers of Taxes or Other Taxes, the
Borrowers shall furnish the Administrative Agent the original or a certified
copy of a receipt evidencing payment thereof, or other evidence of payment
satisfactory to the Administrative Agent.
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(e) If the Borrowers are required to pay additional amounts to
any Lender or the Administrative Agent pursuant to SUBSECTION (c) of this
Section, then such Lender shall use reasonable efforts (consistent with legal
and regulatory restrictions) to change the jurisdiction of its lending office so
as to eliminate any such additional payment by the Borrowers which may
thereafter accrue, if such change in the judgment of such Lender is not
otherwise disadvantageous to such Lender.
4.2 ILLEGALITY.
(a) If any Lender determines that the introduction of any
Requirement of Law, or any change in any Requirement of Law, or in the
interpretation or administration of any Requirement of Law, has made it
unlawful, or that any central bank or other Governmental Authority has asserted
that it is unlawful, for any Lender or its applicable lending office to make
LIBOR Rate Loans, then, on notice thereof by that Lender to the Borrowers
through the Administrative Agent, any obligation of that Lender to make LIBOR
Rate Loans shall be suspended until that Lender notifies the Administrative
Agent and the Borrowers that the circumstances giving rise to such determination
no longer exist.
(b) If a Lender determines that it is unlawful to maintain any
LIBOR Rate Loan, the Borrowers shall, upon its receipt of notice of such fact
and demand from such Lender (with a copy to the Administrative Agent), prepay in
full such LIBOR Rate Loans of that Lender then outstanding, together with
interest accrued thereon and amounts required under SECTION 4.4, either on the
last day of the Interest Period thereof, if that Lender may lawfully continue to
maintain such LIBOR Rate Loans to such day, or immediately, if that Lender may
not lawfully continue to maintain such LIBOR Rate Loans. If the Borrowers are
required to so prepay any LIBOR Rate Loans, then concurrently with such
prepayment, the Borrowers shall borrow from the affected Lender, in the amount
of such repayment, a Base Rate Loan.
4.3 INCREASED COSTS AND REDUCTION OF RETURN.
(a) If any Lender determines that due to either (i) the
introduction of or any change in the interpretation of any law or regulation or
(ii) the compliance by that Lender with any guideline or request from any
central bank or other Governmental Authority (whether or not having the force of
law), there shall be any increase in the cost to such Lender of agreeing to make
or making, funding or maintaining any LIBOR Rate Loans, then the Borrowers shall
be liable for, and shall from time to time, upon demand (with a copy of such
demand to be sent to the Administrative Agent), pay to the Administrative Agent
for the account of such Lender, additional amounts as are sufficient to
compensate such Lender for such increased costs.
(b) If any Lender shall have determined that (i) the
introduction of any Capital Adequacy Regulation, (ii) any change in any Capital
Adequacy Regulation, (iii) any change in the interpretation or administration of
any Capital Adequacy Regulation by any central bank or other Governmental
Authority charged with the interpretation or administration thereof, or (iv)
compliance by such Lender or any corporation or other entity controlling such
Lender with any Capital Adequacy Regulation, affects or would affect the amount
of capital required or expected to be maintained by such Lender or any
corporation or other entity controlling such Lender and (taking into
consideration such Lender's or such corporation's or other entity's
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policies with respect to capital adequacy and such Lender's desired return on
capital) determines that the amount of such capital is increased as a
consequence of its Commitments, loans, credits or obligations under this
Agreement, then, upon demand of such Lender to the Borrowers through the
Administrative Agent, the Borrowers shall pay to such Lender, from time to time
as specified by such Lender, additional amounts sufficient to compensate such
Lender for such increase.
4.4 FUNDING LOSSES. The Borrowers shall reimburse each Lender and hold
each Lender harmless from any loss or expense which such Lender may sustain or
incur as a consequence of:
(a) the failure of the Borrowers to make on a timely basis any
payment of principal of any LIBOR Rate Loan;
(b) the failure of the Borrowers to borrow, continue or
convert a Loan after the Borrowers have given (or are deemed to have given) a
Notice of Borrowing or a Notice of Continuation/Conversion; or
(c) the prepayment or other payment (including after
acceleration thereof) of any LIBOR Rate Loans on a day that is not the last day
of the relevant Interest Period;
including any such loss of anticipated profit and any loss or expense arising
from the liquidation or reemployment of funds obtained by them to maintain their
LIBOR Rate Loans or from fees payable to terminate the deposits from which such
funds were obtained. The Borrowers shall also pay any customary administrative
fees charged by any Lender in connection with the foregoing.
4.5 INABILITY TO DETERMINE RATES. If the Administrative Agent
determines that for any reason adequate and reasonable means do not exist for
determining the LIBOR Rate for any requested Interest Period with respect to a
proposed LIBOR Rate Loan, or that the LIBOR Rate for any requested Interest
Period with respect to a proposed LIBOR Rate Loan does not adequately and fairly
reflect the cost to the Lenders of funding such Loan, the Administrative Agent
will promptly so notify the Borrowers and each Lender. Thereafter, the
obligation of the Lenders to make or maintain LIBOR Rate Loans hereunder shall
be suspended until the Administrative Agent revokes such notice in writing. Upon
receipt of such notice, the Borrowers may revoke any Notice of Borrowing or
Notice of Continuation/Conversion then submitted by them. If the Borrowers do
not revoke such Notice, the Lenders shall make, convert or continue the Loans,
as proposed by the Borrowers, in the amount specified in the applicable notice
submitted by the Borrowers, but such Loans shall be made, converted or continued
as Base Rate Loans denominated in Dollars instead of LIBOR Rate Loans.
4.6 CERTIFICATES OF ADMINISTRATIVE AGENT. If any Lender claims
reimbursement or compensation under this ARTICLE 4, the Administrative Agent
shall determine the amount thereof and shall deliver to the Borrowers (with a
copy to the affected Lender) a certificate setting forth in reasonable detail
the amount payable to the affected Lender, and such certificate shall be
conclusive and binding on the Borrowers in the absence of manifest error.
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4.7 SURVIVAL. The agreements and obligations of the Borrowers in this
ARTICLE 4 shall survive the payment of all other Obligations.
ARTICLE 5
BOOKS AND RECORDS; FINANCIAL INFORMATION; NOTICES
-------------------------------------------------
5.1 BOOKS AND RECORDS. The Borrowers shall maintain, at all times,
correct and complete books, records and accounts in which complete, correct and
timely entries are made of its transactions, the same to be maintained in the
case of the Parent in accordance with GAAP applied consistently with the audited
Financial Statements required to be delivered pursuant to SECTION 5.2(a). The
Borrowers shall, by means of appropriate entries, reflect in such accounts and
in all Financial Statements proper liabilities and reserves for all taxes and
proper provision for depreciation and amortization of property and bad debts,
all in accordance with GAAP. The Borrowers shall maintain at all times books and
records pertaining to the Collateral in such detail, form and scope as the
Administrative Agent or any Lender shall reasonably require, including, but not
limited to, records of (a) all payments received and all credits and extensions
granted with respect to the Accounts; (b) the return, rejection, repossession,
stoppage in transit, loss, damage, or destruction of any Inventory; and (c) all
other dealings affecting the Collateral.
5.2 FINANCIAL INFORMATION. The Borrowers shall promptly furnish to each
Lender, all such financial information as the Administrative Agent shall
reasonably request. Without limiting the foregoing, the Parent will furnish to
the Administrative Agent, in sufficient copies for distribution by the
Administrative Agent to each Lender, the following, in such detail as the
Administrative Agent or the Lenders shall request:
(a) As soon as available, but in any event not later than one
hundred ten (110) days after the close of each Fiscal Year, consolidated audited
and consolidating unaudited balance sheets and income statements, cash flow
statements and changes in stockholders' equity for the Parent and its
consolidated Subsidiaries for such Fiscal Year, and, if not provided on the
consolidation, such information for the Parent, individually, the UK Borrowers
and their Subsidiaries, for the French Borrower and its Subsidiaries and for
Unifrax Brazil and its Subsidiaries, and the accompanying notes thereto, setting
forth in each case in comparative form figures for the previous Fiscal Year, all
in reasonable detail, fairly presenting the financial position and the results
of operations of the Parent and its Subsidiaries (and the Borrowers and their
consolidated Subsidiaries) as at the date thereof and for the Fiscal Year then
ended, and prepared in accordance with GAAP (except that, with respect to
unaudited statements, only the Parent's shall be prepared in accordance with
GAAP). Such statements shall be examined in accordance with generally accepted
auditing standards by and, in the case of such statements performed on a
consolidated basis, accompanied by a report thereon unqualified in any respect
of independent certified public accountants selected by the Parent and
reasonably satisfactory to the Administrative Agent. The Parent, simultaneously
with retaining such independent public accountants to conduct such annual audit,
shall send a letter to such accountants, with a copy to the Administrative Agent
and the Lenders, notifying such accountants that one of the primary purposes for
retaining such accountants' services and having audited financial statements
prepared by them is for use by the Administrative Agent and the Lenders. The
Parent hereby authorizes the Administrative Agent to communicate directly with
its certified public
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accountants and, by this provision, authorizes those accountants to disclose to
the Administrative Agent any and all financial statements and other supporting
financial documents and schedules relating to the Parent and the other Borrowers
and their respective Subsidiaries and to discuss directly with the
Administrative Agent the finances and affairs of the Parent and the other
Borrowers and their respective Subsidiaries, provided that a representative of
the Parent shall be a party to such communication and discussion.
(b) As soon as available, but in any event not later than
thirty (30) days after the end of each month (except forty-five days in the case
of September 30, 2000), consolidated and consolidating unaudited balance sheets
as at the end of such month, and consolidated and consolidating unaudited income
statements and cash flow statements for the Parent and its consolidated
Subsidiaries for such month and for the period from the beginning of the Fiscal
Year to the end of such month, and, if not provided on the consolidation, such
information for the Parent, individually, the UK Borrowers and their
Subsidiaries, for the French Borrower and its Subsidiaries and for Unifrax
Brazil and its Subsidiaries, all in reasonable detail, fairly presenting the
financial position and results of operations of the Parent and its Subsidiaries
and the Borrowers and their consolidated Subsidiaries as at the date thereof and
for such periods, and, in each case, in comparable form, figures for the
corresponding period in the prior Fiscal Year, and, in the case of the Parent
only, prepared in accordance with GAAP applied consistently with the audited
Financial Statements required to be delivered pursuant to SECTION 5.2(a). The
Parent shall certify by a certificate signed by its chief financial officer that
all such statements have been prepared in accordance with GAAP in the case of
the Parent and present fairly in all material respects the financial position of
the Parent and its Subsidiaries and the Borrowers and their consolidated
Subsidiaries as at the dates thereof and its results of operations for the
periods then ended, subject to normal year-end adjustments.
(c) With each of the audited Financial Statements delivered
pursuant to SECTION 5.2(a), a certificate of the independent certified public
accountants that examined such statement to the effect that they have reviewed
and are familiar with this Agreement and that, in examining such Financial
Statements, they did not become aware of any fact or condition which then
constituted a Default or Event of Default with respect to a financial covenant,
except for those, if any, described in reasonable detail in such certificate.
(d) With each of the annual audited Financial Statements
delivered pursuant to SECTION 5.2(a), and within thirty (30) days after the end
of each fiscal month, a certificate of a Responsible Officer of the Parent
setting forth in reasonable detail the calculations required to establish that
the Borrowers were in compliance with the covenants set forth in SECTION 7.22
monthly and in SECTIONS 7.23, 7.24 and 7.25 quarterly, during the period covered
in such Financial Statements and as at the end thereof and setting forth in
detail the aggregate, end-of-month amount of all Permitted Intercompany
Advances. With each of the annual audited Financial Statements delivered
pursuant to SECTION 5.2(a), a certificate of a Responsible Officer of the Parent
setting forth in reasonable detail the calculation of Excess Cash Flow and the
mandatory prepayment required by SECTION 1.3(c) (Term Credit Facility Mandatory
Prepayments). Within thirty (30) days after the end of each month, a certificate
of a Responsible Officer of the Parent stating that, except as explained in
reasonable detail in such certificate, (A) all of the representations and
warranties of the Borrowers contained in this Agreement and the other Loan
Documents are correct and complete in all material respects as at the date of
such
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certificate as if made at such time, except for those that speak as of a
particular date, (B) the Borrowers are, at the date of such certificate, in
compliance in all material respects with all of their respective covenants and
agreements in this Agreement and the other Loan Documents, and (C) no Default or
Event of Default then exists or existed during the period covered by the
Financial Statements for such month. If such certificate discloses that a
representation or warranty is not correct or complete in any material respect,
or that a covenant has not been complied with, or that a Default or Event of
Default existed or exists, such certificate shall set forth what action the
Borrowers have taken or propose to take with respect thereto.
(e) No later than thirty (30) days after the beginning of each
Fiscal Year, annual forecasts (to include forecasted consolidated and
consolidating balance sheets, income statements and cash flow statements) for
the Parent and its Subsidiaries as at the end of and for each month of such
Fiscal Year, with sufficient detail for the UK Borrowers and their Subsidiaries,
French Holdco and its Subsidiaries, and Unifrax Brazil and its Subsidiaries.
(f) As soon as available, but in any event not later than (i)
twenty (20) days after the end of each month, a monthly Borrowing Base
Certificate and all information and documentation that support the calculations
set forth in such Borrowing Base Certificate as set forth in Exhibit B with
respect to the Parent as long as the aggregate of the US Availability and the
Dollar Equivalent of the UK Availability is at least $7,500,000, and otherwise,
three (3) days after the end of each calendar week; (ii) twenty (20) days after
the end of each month, a monthly Borrowing Base Certificate and all information
and documentation that support the calculations set forth in such Borrowing Base
Certificate as set forth in Exhibit B with respect to the UK Borrowers as long
as the UK Availability is at least (pound)700,000 through and including November
3, 2000 and (pound)1,000,000 thereafter, and otherwise, three (3) days after the
end of each calendar week ; (iii) with each Borrowing Base Certificate, a roll
forward of accounts; (iv) on a monthly basis, by the 20th day of the following
month, or more frequently if requested by the Administrative Agent, an aging of
the applicable Borrower's Accounts, together with a reconciliation to the
corresponding Borrowing Base Certificate and to the applicable Borrower's
general ledger; (v) on a monthly basis by the 20th day of the following month,
or more frequently if requested by the Administrative Agent, an aging of the
applicable Borrower's accounts payable; (vi) on a monthly basis by the 20th day
of the following month (or more frequently if requested by Administrative
Agent), a detailed calculation of Eligible Accounts and Eligible Inventory;
(vii) on a monthly basis by the 20th day of the following month (or more
frequently if requested by the Administrative Agent), Inventory reports by
category together with a reconciliation to the corresponding Borrowing Base
Certificate and the applicable Borrower's general ledger; (viii) upon request,
copies of invoices in connection with the applicable Borrower's Accounts,
customer statements, credit memos, remittance advices and reports, deposit
slips, shipping and delivery documents in connection with the applicable
Borrower's Accounts and for Inventory and Equipment acquired by the Borrower,
purchase orders and invoices; (ix) such other reports as to the Collateral of
the Parent and the UK Borrowers as the Administrative Agent shall reasonably
request from time to time; and (x) with the delivery of each of the foregoing, a
certificate of the applicable Borrower executed by a Responsible Officer thereof
certifying as to the accuracy and completeness of the foregoing. If any of the
Parent's or the UK Borrowers' records or reports of the Collateral are prepared
by an accounting service or other agent, each such Borrower hereby authorizes
such service or agent to deliver copies of such
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records, reports, and related documents to the Administrative Agent promptly
after the request of the Administrative Agent to do so, for distribution to the
Lenders.
(g) Promptly after the request of the Administrative Agent,
each annual report or other filing filed with respect to each Plan of the
Borrowers.
(h) Promptly upon the filing thereof, copies of all reports,
if any, to or other documents filed by Holdings, Parent or any of their
Subsidiaries with the Securities and Exchange Commission under the Exchange Act,
and all reports, notices, or statements sent or received by the Borrowers or any
of their Subsidiaries to or from the holders of any equity interests of the
Parent or, at any time when Holdings is required to file reports with the
Securities and Exchange Commission under the Exchange Act, of Holdings (other
than routine non-material correspondence sent by shareholders of Parent or
Holdings to Parent or Holdings) or any such Subsidiary or of any Debt of the
Holdings, Parent or any of their Subsidiaries registered under the Securities
Act of 1933 or to or from the trustee under any indenture under which the same
is issued.
(i) As soon as available, but in any event not later than 15
days after the Borrowers' receipt thereof, a copy of all management reports and
management letters prepared for the Borrowers by any independent certified
public accountants of the Borrowers.
(j) Promptly after their preparation, copies of any and all
proxy statements, financial statements, and reports which the Borrowers make
available to their shareholders.
(k) If requested by the Administrative Agent, promptly after
filing with the IRS, a copy of each tax return filed by the Borrowers or by any
of their Subsidiaries.
(l) Such additional information as the Administrative Agent
and/or any Lender may from time to time reasonably request regarding the
financial and business affairs of the Borrowers or any Subsidiary.
5.3 NOTICES TO THE LENDERS. The Borrowers shall notify the
Administrative Agent and the Lenders in writing of the following matters at the
following times:
(a) Immediately after becoming aware of any Default or Event
of Default;
(b) Immediately after becoming aware of the assertion by the
holder of any capital stock of the Borrowers or of any Subsidiary or the holder
of any Debt of the Borrowers or any Subsidiary in a face amount in excess of
$100,000 or the Foreign Currency Equivalent thereof that a default exists with
respect thereto or that the Borrowers or such Subsidiary are not in compliance
with the terms thereof, or the threat or commencement by such holder of any
enforcement action because of such asserted default or non-compliance;
(c) Immediately after becoming aware of any event or
circumstance which could reasonably be expected to have a Material Adverse
Effect;
(d) Promptly (and in any event, within ten (10) Business Days)
after becoming aware of any pending or threatened action, suit, or proceeding,
by any Person, or any
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pending or threatened investigation by a Governmental Authority, which could
reasonably be expected to have a Material Adverse Effect;
(e) Promptly (and in any event, within ten (10) Business Days)
after becoming aware of any pending or threatened strike, work stoppage, unfair
labor practice claim, or other labor dispute affecting the Borrowers or any
Subsidiary in a manner which could reasonably be expected to have a Material
Adverse Effect;
(f) Promptly (and in any event, within ten (10) Business Days)
after becoming aware of any violation of any law, statute, regulation, or
ordinance of a Governmental Authority affecting the Borrowers or any Subsidiary
which could reasonably be expected to have a Material Adverse Effect;
(g) Promptly (and in any event, within ten (10) Business Days)
after receipt of any notice of any violation by the Borrowers or any Subsidiary
of any Environmental Law which could reasonably be expected to have a Material
Adverse Effect or that any Governmental Authority has asserted in writing that
the Borrowers or any Subsidiary are not in compliance with any Environmental Law
or is investigating the Borrowers' or such Subsidiary's compliance therewith;
(h) Promptly (and in any event, within ten (10) Business Days)
after receipt of any written notice that the Borrowers or any Subsidiary are or
may be liable to any Person as a result of the Release or threatened Release of
any Contaminant or that the Borrowers or any Subsidiary are subject to
investigation by any Governmental Authority evaluating whether any remedial
action is needed to respond to the Release or threatened Release of any
Contaminant which, in either case, is reasonably likely to give rise to
liability in excess of $500,000 or the Foreign Currency Equivalent thereof;
(i) Promptly (and in any event, within ten (10) Business Days)
after receipt of any written notice of the imposition of any Environmental Lien
against any property of the Borrowers or any Subsidiary;
(j) Any change in the Borrowers' name, jurisdiction of
organization, form of organization, trade names under which the Borrowers will
sell Inventory or create Accounts, or to which instruments in payment of
Accounts may be made payable, or additional locations of Collateral that has a
value of $100,000 or more, in each case at least thirty (30) days prior thereto;
(k) Within ten (10) Business Days after the Borrowers or any
ERISA Affiliate knows or has reason to know that an ERISA Event or a prohibited
transaction (as defined in Sections 406 of ERISA and 4975 of the Code) has
occurred, and, when known, any action taken or threatened by the IRS, the DOL or
the PBGC with respect thereto;
(l) Upon request, or, in the event that such filing reflects a
Material Adverse Effect with respect to the matters covered thereby, within
three (3) Business Days after the filing thereof with the PBGC, the DOL or the
IRS, as applicable, copies of the following: (i) each annual report (form 5500
series), including Schedule B thereto, filed with the PBGC, the DOL or the IRS
with respect to each Plan, (ii) a copy of each funding waiver request filed with
the
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PBGC, the DOL or the IRS with respect to any Plan and all communications
received by the Borrowers or any ERISA Affiliate from the PBGC, the DOL or the
IRS with respect to such request, and (iii) a copy of each other filing or
notice filed with the PBGC, the DOL or the IRS, with respect to each Plan by
either the Borrowers or any ERISA Affiliate;
(m) Upon request, but only to the extent available, copies of
each actuarial report for any Plan or Multi-employer Plan and annual report for
any Multi-employer Plan; and within three (3) Business Days after receipt
thereof by the Borrowers or any ERISA Affiliate, copies of the following: (i)
any notices of the PBGC's intention to terminate a Plan or to have a trustee
appointed to administer such Plan; (ii) any favorable or unfavorable
determination letter from the IRS regarding the qualification of a Plan under
Section 401(a) of the Code; or (iii) any notice from a Multi-employer Plan
regarding the imposition of withdrawal liability;
(n) Within three (3) Business Days after the occurrence
thereof: (i) any changes in the benefits of any existing Pension Plan which
increase the Borrowers' annual costs with respect thereto by an amount in excess
of $500,000, or the establishment of any new Pension Plan or the commencement of
contributions to any Plan to which the Borrowers or any ERISA Affiliate was not
previously contributing; or (ii) any failure by the Borrowers or any ERISA
Affiliate to make a required installment or any other required payment under
Section 412 of the Code on or before the due date for such installment or
payment; or
(o) Within three (3) Business Days after the Borrowers or any
ERISA Affiliate knows, or senior management of the Parent expects, that any of
the following events has or will occur: (i) a Multi-employer Plan has been or
will be terminated; (ii) the administrator or plan sponsor of a Multi-employer
Plan intends to terminate a Multi-employer Plan; or (iii) the PBGC has
instituted or will institute proceedings under Section 4042 of ERISA to
terminate a Multi-employer Plan.
(p) Within three (3) Business Days after the Parent moves any
Equipment and/or Inventory having a value in excess of $100,000 to a location
which the Parent has designated as a sales office in the Collateral Disclosure
List provided to the Lenders in connection with the Credit Facilities. Any such
notice shall identify the location and Equipment and/or Inventory being moved
with sufficient detail to enable the Administrative Agent to prepare, have
executed by the Parent (if necessary) and record a financing statement in
accordance with the requirements of the Uniform Commercial Code adopted by the
state to which the Equipment or Inventory is being relocated.
Each notice given under this Section shall describe the
subject matter thereof in reasonable detail, and shall set forth the action that
the Borrowers, any Subsidiary, or any ERISA Affiliate, as applicable, have taken
or propose to take with respect thereto.
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ARTICLE 6
GENERAL WARRANTIES AND REPRESENTATIONS
--------------------------------------
Each of the Borrowers warrants and represents to the Administrative
Agent and the Lenders that except as hereafter disclosed to the Administrative
Agent and accepted by the Required Lenders in writing:
6.1 AUTHORIZATION, VALIDITY, AND ENFORCEABILITY OF THIS AGREEMENT AND
THE LOAN DOCUMENTS. Each of the Borrowers has the power and authority to
execute, deliver and perform this Agreement and the other Loan Documents to
which it is a party, to incur the Obligations, and to grant to the
Administrative Agent Liens upon and security interests in the Collateral. Each
of the Borrowers has taken all necessary action (including obtaining approval of
its stockholders if necessary) to authorize its execution, delivery, and
performance of this Agreement and the other Loan Documents to which it is a
party. This Agreement and the other Loan Documents to which it is a party have
been duly executed and delivered by the Borrowers, and constitute the legal,
valid and binding obligations of the Borrowers, enforceable against them in
accordance with their respective terms. The execution, delivery, and performance
by any Borrower of this Agreement and the other Loan Documents to which it is a
party do not and will not conflict with, or constitute a violation or breach of,
or result in the imposition of any Lien upon the property of any Borrower or any
of its Subsidiaries, by reason of the terms of (a) the Senior Note Indenture,
(b) any other contract, mortgage, lease, agreement, indenture, or instrument to
which any Borrower is a party or which is binding upon it and the breach of
which could reasonably be expected to have a Material Adverse Effect, (b) any
Requirement of Law applicable to any Borrower or any of its Subsidiaries, the
breach of which could reasonably be expected to have a Material Adverse Effect,
or (c) the certificate, articles of incorporation, articles of association or
memorandum of association (as applicable) or by-laws or the limited liability
company or limited partnership agreement of any Borrower or any of its
Subsidiaries.
6.2 VALIDITY AND PRIORITY OF SECURITY INTEREST. The provisions of this
Agreement, the Security Documents, and the other Loan Documents create legal and
valid Liens on all the Collateral in favor of the Administrative Agent, for the
ratable benefit of the Administrative Agent and the Lenders, and such Liens,
subject to the need for any applicable filings, constitute perfected and
continuing Liens on all the Collateral, having priority over all other Liens on
the Collateral, except for those Liens identified in CLAUSES (c), (d) and (e) of
the definition of Permitted Liens securing all the Obligations, and enforceable
against the Borrowers and all third parties.
6.3 ORGANIZATION AND QUALIFICATION Each of the Borrowers (a) is duly
organized or incorporated and validly existing in good standing under the laws
of the jurisdiction of its organization or incorporation, (b) is qualified to do
business and is in good standing in the jurisdictions set forth on SCHEDULE 6.3
which are the only jurisdictions in which qualification is necessary in order
for it to own or lease its property and conduct its business, except for those
jurisdictions where the failure to qualify could not be reasonably be expected
to have a Material Adverse Effect, and (c) has all requisite power and authority
to conduct its business and to own its property.
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6.4 CORPORATE NAME; PRIOR TRANSACTIONS. Except as set forth on SCHEDULE
6.4, none of the Borrowers, during the past five (5) years, has been known by or
used any other corporate or fictitious name, or been a party to any merger or
consolidation, or acquired all or substantially all of the assets of any Person,
or acquired any of its property outside of the ordinary course of business,
except as contemplated by the Purchase Agreement Transaction.
6.5 SUBSIDIARIES AND AFFILIATES. SCHEDULE 6.5 is a correct and complete
list as of the Closing Date of the name and relationship to the Borrowers of
each and all of the Borrowers' Subsidiaries and other Affiliates. The Parent
shall update SCHEDULE 6.5 each time the Administrative Agent consents to
additional Subsidiaries. Each Subsidiary is (a) duly incorporated or organized
and validly existing in good standing under the laws of its jurisdiction of
incorporation or organization set forth on SCHEDULE 6.5, and (b) qualified to do
business and in good standing in each jurisdiction in which the failure to so
qualify or be in good standing could reasonably be expected to have a Material
Adverse Effect, and (c) has all requisite power and authority to conduct its
business and own its property.
6.6 FINANCIAL STATEMENTS AND PROJECTIONS.
(a) The Parent has delivered to the Administrative Agent and
the Lenders the audited balance sheet and related statements of income, retained
earnings, cash flows, and changes in stockholders equity for the Parent and its
consolidated Subsidiaries existing prior to the closing of the Purchase
Agreement Transaction and for the business being purchased under the Purchase
Agreement Documents as of December 31, 1999, and for the Fiscal Year then ended,
accompanied by the report thereon of Ernst & Young LLP and Price Waterhouse
Coopers, respectively. The Borrowers have also delivered to the Administrative
Agent and the Lenders the unaudited balance sheet and related statements of
income and cash flows for the Parent and its consolidated Subsidiaries existing
prior to the closing of the Purchase Agreement Transaction as of August 31, 2000
and as of June 30, 2000 for the entities the stock or assets of which are
acquired pursuant to the Purchase Agreement. Such financial statements are
attached hereto as EXHIBIT C. All such financial statements have been prepared
in accordance with GAAP (except for the absence of footnotes and for normal
year-end adjustments) and the financial statements present fairly in all
material respects the financial position of the entities to which they pertain
as at the dates thereof and their results of operations for the periods then
ended.
(b) The Latest Projections when submitted to the Lenders as
required herein represent the good faith estimate of the future financial
performance of the Parent and its consolidated Subsidiaries. The Latest
Projections have been prepared on the basis of the assumptions set forth
therein, which the Borrowers believe are fair and reasonable.
(c) The pro forma balance sheet of the Parent and its
consolidated Subsidiaries as at June 30, 2000, attached hereto as EXHIBIT C,
presents accurately in all material respects the financial condition of the
Parent and its consolidated Subsidiaries as at such date after giving effect to
the transactions contemplated by the Purchase Agreement Transaction as if the
Purchase Agreement Transaction had occurred on such date and the Closing Date
had been such date.
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6.7 CAPITALIZATION. As of the date of this Agreement, the Parent's
authorized capital stock consists of 40,000shares of common stock, par value
$0.01per share, of which 20,000shares are validly issued and outstanding, fully
paid and non-assessable and are owned beneficially and of record by Holdings and
BP Amoco and its Affilatesand 30,000 authorized shares of Series A preferred
stock, of which 20,500 shares are issued and outstanding and 10,000 authorized
shares of Series B preferred stock, of which 1,666.67 shares are issued and
outstanding.
6.8 SOLVENCY. Each of the Borrowers is Solvent prior to and after
giving effect to the Borrowings to be made on the Closing Date, the issuance of
the Brazilian Letter of Credit, the issuance of the Letters of Credit to be
issued on the Closing Date, and the Purchase Agreement Transaction and shall
remain solvent during the term of this Agreement.
6.9 DEBT. After giving effect to the making of the Term Loans and the
Revolving Loans to be made on the Closing Date as of the Closing Date, the
Parent and its Subsidiaries have no Debt, except (a) the Obligations, (b) the
obligations of Parent in respect of the Senior Notes, (c) the Obligations of
Parent with respect to the Subordinated Debt - Seller and (d) Debt described on
SCHEDULE 6.10.
6.10 DISTRIBUTIONS. Since December 31, 1999, no Distribution has been
declared, paid, or made upon or in respect of any capital stock or other
securities of the Parent, and since the Closing Date no Distribution has been
declared, paid, or made upon or in respect of any capital stock or other
securities of the Borrowers or their Subsidiaries, except as such Distribution
may have been permitted by this Agreement.
6.11 REAL ESTATE; LEASES. SCHEDULE 6.11 sets forth, as of the Closing
Date, a correct and complete list of all Real Estate owned by any of the Parent
and the UK Borrowers, all leases and subleases of real or personal property held
by any of the Parent and the UK Borrowers as lessee or sublessee (other than
leases of personal property as to which any such Borrower is lessee or sublessee
for which the value of such personal property in the aggregate is less than
$250,000 or the Foreign Currency Equivalent thereof), and all leases and
subleases of real or personal property held by any of the Parent or the UK
Borrowers as lessor or sublessor. Each such lease and sublease is valid and
enforceable in accordance with its terms and is in full force and effect, and no
default by any Borrower party to any such lease or sublease exists. Except as
set forth on SCHEDULE 6.11, each of the Borrowers has good and marketable title
in fee simple to the Real Estate identified on SCHEDULE 6.11 as owned by each
such Borrower, or valid leasehold interests in all Real Estate designated
therein as "leased" by each such Borrower and each Borrower has good,
indefeasible, and merchantable title to all of its other property reflected on
the December 31, 1999 Financial Statements delivered to the Administrative Agent
and the Lenders, except as disposed of in the ordinary course of business since
the date thereof, free of all Liens except Permitted Liens.
6.12 PROPRIETARY RIGHTS. SCHEDULE 6.12 sets forth as of the Closing
Date a correct and complete list of all of the Parent's and the UK Borrowers'
Proprietary Rights that are material to the current and anticipated future
operation of the businesses of the applicable Borrowers. None of the Proprietary
Rights is subject to any licensing agreement or similar arrangement except as
set forth on SCHEDULE 6.12. To the Borrowers' knowledge, none of such
Proprietary Rights
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infringes on or conflicts with any other Person's property, and no other
Person's property infringes on or conflicts with such Proprietary Rights.
6.13 TRADE NAMES. All trade names or styles under which any Borrower
(other than French Holdco) or any of its Subsidiaries will sell Inventory or
create Accounts, or to which instruments in payment of Accounts may be made
payable, are listed on SCHEDULE 6.13.
6.14 LITIGATION. Except as set forth on SCHEDULE 6.14, there is no
pending, or (to the Borrowers' knowledge) threatened, action, suit, proceeding,
or counterclaim by any Person, or to the Borrowers' knowledge, investigation by
any Governmental Authority, or any basis for any of the foregoing, which if
determined adversely to the Borrowers could reasonably be expected to have a
Material Adverse Effect with respect to any single Borrower or Unifrax Brazil.
6.15 LABOR DISPUTES. Except as set forth on SCHEDULE 6.15, as of the
Closing Date (a) there is no collective bargaining agreement or other labor
contract covering employees of any Borrower or any of its Subsidiaries, (b) no
such collective bargaining agreement or other labor contract is scheduled to
expire during the term of this Agreement, (c) to the Borrower's knowledge, no
union or other labor organization is seeking to organize, or to be recognized
as, a collective bargaining unit of employees of any Borrower or any of its
Subsidiaries or for any similar purpose, and (d) there is no pending or (to the
Borrowers' knowledge) threatened, strike, work stoppage, material unfair labor
practice claim, or other material labor dispute against or affecting any
Borrower or its Subsidiaries or its employees.
6.16 ENVIRONMENTAL LAWS. Except as otherwise disclosed on SCHEDULE
6.16, with respect to the Parent, since the date of the environmental reports
furnished to the Administrative Agent and the Co-Administrative Agent in
connection with the October, 1996 credit facilities provided to the Parent and
with respect Unifrax UK since the date of the environmental reports furnished in
connection with this Agreement and with respect to the other Borrowers and their
Subsidiaries after the Closing Date:
(a) The Borrowers and their Subsidiaries have complied in all
material respects with all Environmental Laws and neither the Borrowers nor any
Subsidiary nor any of their presently owned real property or presently conducted
operations, nor their previously owned real property or prior operations, is
subject to any enforcement order from or liability agreement with any
Governmental Authority or private Person respecting (i) compliance with any
Environmental Law or (ii) any potential liabilities and costs or remedial action
arising from the Release or threatened Release of a Contaminant, the effect of
which non-compliance or liability could reasonably be expected to have a
Material Adverse Effect.
(b) The Borrowers and their Subsidiaries have obtained all
material permits necessary for their current operations under Environmental
Laws, and all such permits are in good standing and the Borrowers and their
Subsidiaries are in compliance with all material terms and conditions of such
permits.
(c) Neither the Borrowers nor any of their respective
Subsidiaries, nor, to the Borrowers' knowledge, any of their predecessors in
interest, have, in material violation of applicable law, stored, treated or
disposed of any hazardous waste in any material respect.
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(d) Neither the Borrowers nor any of their respective
Subsidiaries has received any summons, complaint, order or similar written
notice indicating that they are not currently in compliance with, or that any
Governmental Authority is investigating its compliance with, any Environmental
Laws or that it is or may be liable to any other Person as a result of a Release
or threatened Release of a Contaminant.
(e) To the Borrowers' knowledge, none of the present or past
operations of the Borrowers and their Subsidiaries is the subject of any
investigation by any Governmental Authority evaluating whether any remedial
action is needed to respond to a Release or threatened Release of a Contaminant.
(f) There is not now, nor to the Borrowers' knowledge, has
there ever been on or in the Real Estate:
(1) any underground storage tanks or surface
impoundments,
(2) any asbestos-containing material, or
(3) any polychlorinated biphenyls (PCBs) used in
hydraulic oils, electrical transformers or other equipment.
(g) Neither the Borrowers nor any of their respective
Subsidiaries have filed any notice under any requirement of Environmental Law
reporting a spill or accidental and unpermitted Release or discharge of a
Contaminant into the environment.
(h) Neither the Borrowers nor any of their respective
Subsidiaries have entered into any negotiations or settlement agreements with
any Person (including the prior owner of its property) imposing material
obligations or liabilities on the Borrowers or any of its Subsidiaries with
respect to any remedial action in response to the Release of a Contaminant or
environmentally related claim.
(i) None of the products manufactured, distributed or sold by
the Borrowers or any of their Subsidiaries contain asbestos-containing material.
(j) No Environmental Lien has attached to the Real Estate.
6.17 NO VIOLATION OF LAW. None of the Borrowers nor any of their
respective Subsidiaries are in violation of any law, statute, regulation,
ordinance, judgment, order, or decree applicable to it which violation could
reasonably be expected to have a Material Adverse Effect.
6.18 NO DEFAULT. None of the Borrowers nor any of their respective
Subsidiaries is in default with respect to any note, indenture, loan agreement,
mortgage, lease, deed, or other agreement to which any Borrower or such
Subsidiary is a party or by which it is bound, which default could reasonably be
expected to have a Material Adverse Effect.
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6.19 ERISA COMPLIANCE. Except as specifically disclosed in SCHEDULE
6.19:
(a) Each Plan is in compliance in all material respects with
the applicable provisions of ERISA, the Code and other federal or state law.
Each Plan which is intended to qualify under Section 401(a) of the Code has
received a favorable determination letter from the IRS and to the best knowledge
of the Borrowers, nothing has occurred which would cause the loss of such
qualification. The Borrowers and each ERISA Affiliate have made all required
contributions to any Plan subject to Section 412 of the Code, and no application
for a funding waiver or an extension of any amortization period pursuant to
Section 412 of the Code has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of
Borrowers, threatened claims, actions or lawsuits, or action by any Governmental
Authority, with respect to any Plan which has resulted or could reasonably be
expected to result in a Material Adverse Effect. There has been no prohibited
transaction (as defined in Sections 406 of ERISA and 4975 of the Code) or
violation of the fiduciary responsibility rules with respect to any Plan which
has resulted or could reasonably be expected to result in a Material Adverse
Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected
to occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither
the Borrowers nor any ERISA Affiliate have incurred, or reasonably expect to
incur, any liability under Title IV of ERISA with respect to any Pension Plan
(other than premiums due and not delinquent under Section 4007 of ERISA); (iv)
neither the Borrowers nor any ERISA Affiliate have incurred, or reasonably
expect to incur, any liability (and no event has occurred which, with the giving
of notice under Section 4219 of ERISA, would result in such liability) under
Section 4201 or 4243 of ERISA with respect to a Multi-employer Plan; and (v)
neither the Borrowers nor any ERISA Affiliate have engaged in a transaction that
could be subject to Section 4069 or 4212(c) of ERISA.
6.20 TAXES. The Parent and its Subsidiaries have filed all federal and
other tax returns and reports required to be filed, and have paid all federal
and other taxes, assessments, fees and other governmental charges levied or
imposed upon them or their properties, income or assets otherwise due and
payable unless such unpaid taxes and assessments would constitute a Permitted
Lien.
6.21 REGULATED ENTITIES. None of the Borrowers, any Person controlling
the Borrowers, or any Subsidiary, is an "Investment Company" within the meaning
of the Investment Company Act of 1940. The Borrowers are not subject to
regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act, any state public utilities code or law,
or any other federal or state statute or regulation limiting its ability to
incur indebtedness.
6.22 USE OF PROCEEDS; MARGIN REGULATIONS. The proceeds of the Loans are
to be used solely for payment of a portion of the purchase price under the
Purchase Agreement Transaction and for working capital purposes and for general
corporate purposes not prohibited by the terms of this Agreement. The proceeds
of the Term Loan (UK) Additional Advance shall be used only to pay the
Subordinated Real Estate Note - Seller and, thereafter to repay the US/UK
Intercompany Advance in whole or in part and to apply the same to the US
Revolving Loans. In
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the event the proceeds of the Term Loan (UK) Additional Advance are not
sufficient to pay the Subordinated Real Estate Note - Seller in full, the Parent
may pay the balance of the Subordinated Real Estate Note - Seller but only if US
Availability plus UK Availability immediately after such payment is not less
than $7,500,000. None of the Borrowers nor any of their Subsidiaries is engaged
in the business of purchasing or selling Margin Stock or extending credit for
the purpose of purchasing or carrying Margin Stock.
6.23 INFRINGEMENTS OF COPYRIGHTS, PATENTS, TRADEMARKS AND LICENSES,
ETC. To the knowledge of the Borrowers, no slogan or other advertising device,
product, process, method, substance, part or other material now employed, or now
contemplated to be employed, by any Borrower or any Subsidiary infringes upon
any rights held by any other Person. No claim or litigation regarding any of the
foregoing or regarding any Proprietary Right is pending or, to the knowledge of
the Borrowers, threatened, and no patent, invention, device, application,
principle or any statute, law, rule, regulation, standard or code is pending or,
to the knowledge of the Borrowers, proposed, which, in either case, could
reasonably be expected to have a Material Adverse Effect.
6.24 NO MATERIAL ADVERSE CHANGE. Since December 31, 1999, there has
occurred no event that could reasonably be expected to result in a Material
Adverse Effect.
6.25 FULL DISCLOSURE. None of the representations or warranties made by
any Borrower or any Subsidiary in the Loan Documents taken as a whole together
with all other written statements or certificates as of the date such
representations and warranties are made or deemed made, and none of the
statements contained in any exhibit, report, statement or certificate furnished
by or on behalf of any Borrower or any Subsidiary in connection with the Loan
Documents (including the offering and disclosure materials delivered by or on
behalf of the Borrowers to the Lenders prior to the Closing Date), contain any
untrue statement of a material fact or omit any material fact required to be
stated therein or necessary to make the statements made therein, in light of the
circumstances under which they were made, not misleading in any material respect
as of the time when made or delivered.
6.26 MATERIAL AGREEMENTS. SCHEDULE 6.26 hereto sets forth as of the
Closing Date all material agreements and contracts to which any Borrower or any
of its Subsidiaries is a party or is bound as of the date hereof.
6.27 BANK ACCOUNTS. SCHEDULE 6.27 contains, as of the Closing Date, a
complete and accurate list of all bank accounts maintained by the Borrowers with
any bank or other financial institution.
6.28 GOVERNMENTAL AUTHORIZATION. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority or other Person is necessary or required in connection
with the execution, delivery or performance by, or enforcement against, the
Borrowers or any of their Subsidiaries of this Agreement or any other Loan
Document, except as such has been obtained and except for such filings required
to create or perfect the Liens in favor of the Administrative Agent that are
contemplated by this Agreement or the other Loan Documents.
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6.29 PURCHASE AGREEMENT TRANSACTION.
The Administrative Agent has received true and correct
photocopies of the Purchase Agreement and each of the other Purchase Agreement
Documents, executed, delivered and/or furnished on or before the Closing Date in
connection with the Purchase Agreement Transaction. Neither the Purchase
Agreement nor any of the other Purchase Agreement Documents have been modified,
changed, supplemented, canceled, amended or otherwise altered or affected in any
material respect, except as otherwise disclosed to the Administrative Agent in
writing on or before the Closing Date. The Purchase Agreement Transaction has
been effected, closed and consummated pursuant to, and in accordance with, all
material terms and conditions of the Purchase Agreement and in all material
respects with all applicable Laws.
ARTICLE 7
AFFIRMATIVE AND NEGATIVE COVENANTS
----------------------------------
Each Borrower covenants to the Administrative Agent and each Lender
that so long as any of the Obligations (other than contingent obligations for
indemnification but not including reimbursement obligations with respect to the
Brazilian Letter of Credit or other Letters of Credit) remain outstanding or
this Agreement is in effect:
7.1 TAXES AND OTHER OBLIGATIONS. The Parent shall, and shall cause each
of its Subsidiaries to, (a) file when due all tax returns and other reports
which it is required to file; (b) pay, or provide for the payment, when due, of
all taxes, fees, assessments and other governmental charges against it or upon
its property, income and franchises, make all required withholding and other tax
deposits, and establish adequate reserves for the payment of all such items, and
provide to the Administrative Agent upon its request, satisfactory evidence of
its timely compliance with the foregoing; and (c) pay when due all obligations
owed by it and all claims of materialmen, mechanics, carriers, warehousemen,
landlords, processors and other like Persons, and all other indebtedness owed by
it and perform and discharge in a timely manner all other obligations undertaken
by it; PROVIDED, HOWEVER, neither the Parent nor any of its Subsidiaries need
pay any tax, fee, assessment, or governmental charge (i) they are contesting in
good faith by appropriate proceedings diligently pursued, (ii) as to which the
Parent or its respective Subsidiaries, as the case may be, have established
proper reserves as required under GAAP, and (iii) the nonpayment of which does
not result in the imposition of a Lien (other than a Permitted Lien).
7.2 LEGAL EXISTENCE AND GOOD STANDING. The Borrowers shall, and shall
cause each of their respective Subsidiaries to, maintain their legal existence
and their qualification and good standing in all jurisdictions in which the
failure to maintain such existence and qualification or good standing could
reasonably be expected to have a Material Adverse Effect.
7.3 COMPLIANCE WITH LAW AND AGREEMENTS; MAINTENANCE OF LICENSES. The
Borrowers shall comply, and shall cause each Subsidiary to comply, in all
material respects with all Requirements of Law of any Governmental Authority
having jurisdiction over them or their business (including the Federal Fair
Labor Standards Act and all Environmental Laws), except to the extent any such
noncompliance would not reasonably be expected to have a Material Adverse
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Effect. The Borrowers shall, and shall cause each of their respective
Subsidiaries to, obtain and maintain all licenses, permits, franchises, and
governmental authorizations necessary to own their property and to conduct their
business as conducted on the Closing Date, except to the extent the failure to
do so would not reasonably be expected to have a Material Adverse Effect. The
Borrowers shall not modify, amend or alter their certificates or articles of
incorporation, articles of association or memorandum of association, as
applicable, or their limited liability company operating agreement or limited
partnership agreement, as applicable, other than in a manner which does not
materially and adversely affect the rights of the Lenders or the Administrative
Agent.
7.4 MAINTENANCE OF PROPERTY; INSPECTION OF PROPERTY.
(a) Subject to the other provisions of this Agreement and the
other Loan Documents, the Borrowers shall, and shall cause each of their
respective Subsidiaries to, maintain all of their property necessary and useful
in the conduct of their business, in good operating condition and repair,
ordinary wear and tear excepted.
(b) The Borrowers shall permit representatives and independent
contractors of the Administrative Agent to visit and inspect any of their
properties, to examine their corporate, financial and operating records, and
make copies thereof or abstracts therefrom and to discuss their affairs,
finances and accounts with its directors, officers and independent public
accountants, at such reasonable times during normal business hours and as soon
as may be reasonably desired, upon reasonable advance notice to the Borrowers.
The Borrowers shall be responsible to pay the cost of the described audit not to
exceed (i) two (2) times per year, as long as the US Availability and Dollar
Equivalent of the UK Availability is greater than $7,500,000, and four (4) times
per year otherwise; PROVIDED, HOWEVER, when an Event of Default exists, the
Administrative Agent or any Lender may do any of the foregoing at the expense of
the Borrowers at any time during normal business hours and without advance
notice.
7.5 INSURANCE.
(a) The Borrowers shall maintain, and shall cause each of
their respective Subsidiaries, with financially sound and reputable insurers
having a rating of at least A+ or better by Best Rating Guide, insurance against
loss or damage by fire with extended coverage; theft, burglary, pilferage and
loss in transit; public liability and third party property damage; larceny,
embezzlement or other criminal liability; business interruption; public
liability and third party property damage; and such other hazards or of such
other types as is customary for Persons engaged in the same or similar business,
in amounts, and under policies acceptable to the Administrative Agent and the
Majority Lenders. Without limiting the foregoing, the Borrowers shall also
maintain, and shall cause each of their respective Subsidiaries to maintain,
flood insurance, in the event of a designation of the area in which any Real
Estate covered by the Mortgages and any of the Equipment and Inventory located
on such Real Estate is located as "flood prone" or a "flood risk area,"
(hereinafter "SFHA") as defined by the Flood Disaster Protection Act of 1973, in
an amount to be reasonably determined by the Administrative Agent, and shall
comply with the additional requirements of the National Flood Insurance Program
as set forth in said Act. The Borrowers shall also maintain flood insurance for
their Inventory and Equipment which is, at any time, located in a SFHA.
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(b) The Borrowers shall cause the Administrative Agent, for
the ratable benefit of the Administrative Agent and the Lenders, to be named as
secured party or mortgagee and only loss payee or additional insured, in a
manner acceptable to the Administrative Agent. Each policy of insurance shall
contain a clause or endorsement requiring the insurer to give not less than
thirty (30) days' prior written notice to the Administrative Agent in the event
of cancellation of the policy for any reason whatsoever and a clause or
endorsement stating that the interest of the Administrative Agent shall not be
impaired or invalidated by any act or neglect of any Borrower or any Subsidiary
or the owner of any Real Estate for purposes more hazardous than are permitted
by such policy. All premiums for such insurance shall be paid by the Borrowers
when due, and certificates of insurance and photocopies of the policies shall be
delivered to the Administrative Agent, in each case in sufficient quantity for
distribution by the Administrative Agent to each of the Lenders. If any Borrower
fails to procure such insurance or to pay the premiums therefor when due, the
Administrative Agent may, and at the direction of the Required Lenders, shall do
so from the proceeds of Revolving Loans.
7.6 INSURANCE AND CONDEMNATION PROCEEDS. The Borrowers shall promptly
notify the Administrative Agent and the Lenders of any loss, damage, or
destruction to the Collateral in excess of $75,000 for the Parent or
(pound)50,000 for the UK Borrowers, whether or not covered by insurance. The
Administrative Agent is hereby authorized to collect all insurance and
condemnation proceeds in respect of Collateral directly and to apply or remit
them as follows:
(i) With respect to insurance and condemnation
proceeds relating to Collateral other than Fixed Assets, after deducting from
such proceeds the reasonable expenses, if any, incurred by the Administrative
Agent in the collection or handling thereof, the Administrative Agent shall
apply such proceeds, ratably, to the reduction of the Obligations in the order
provided for in SECTION 3.7.
(ii) With respect to insurance and condemnation
proceeds relating to Collateral consisting of Fixed Assets, the Administrative
Agent shall permit or require the Borrowers to use such proceeds, or any part
thereof, to replace, repair, restore or rebuild the relevant Fixed Assets in a
diligent and expeditious manner with materials and workmanship of substantially
the same quality as existed before the loss, damage or destruction; so long as
(1) no Default or Event of Default has occurred and is continuing, (2) the
aggregate proceeds do not exceed $750,000 for the Parent or (pound)500,000 for
the UK Borrowers in the aggregate and (3) the Borrowers (i) provide the
Administrative Agent and the Required Lenders with plans and specifications for
any such repair or restoration which shall be reasonably satisfactory to the
Administrative Agent and the Required Lenders and (ii) demonstrate to the
reasonable satisfaction of the Administrative Agent and the Required Lenders
that the funds available to them will be sufficient to complete such project in
the manner provided therein. In all other circumstances, the Administrative
Agent shall apply such insurance and condemnation proceeds, ratably, to the
reduction of the Obligations in the order provided for in SECTION 3.3.
7.7 ENVIRONMENTAL LAWS.
(a) The Borrowers shall, and shall cause each of their
respective Subsidiaries to, conduct their business in material compliance with
all Environmental Laws applicable to them, including those relating to the
generation, handling, use, storage, and disposal of any
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Contaminant. The Borrowers shall, and shall cause each of their respective
Subsidiaries to, take prompt and appropriate action to respond to any material
non-compliance with Environmental Laws and shall regularly report to the
Administrative Agent on such response.
(b) Without limiting the generality of the foregoing, the
Borrowers shall submit to the Administrative Agent and the Lenders annually,
commencing on the first Anniversary Date, and on each Anniversary Date
thereafter, an update of the status of each instance of material non-compliance
or liability issue arising under Environmental Laws. The Administrative Agent or
any Lender may request copies of technical reports prepared by the Borrowers and
their communications with any Governmental Authority to determine whether the
Borrowers or any of their Subsidiaries are proceeding reasonably to correct,
cure or contest in good faith any alleged non-compliance or liability arising
under Environmental Laws. The Borrowers shall, at the Administrative Agent's or
the Required Lenders' request and at the Borrowers' expense, (i) retain an
independent environmental engineer acceptable to the Administrative Agent to
evaluate the site, including tests if appropriate, where there has been a
material non-compliance with Environmental Laws or an allegation thereof and
prepare and deliver to the Administrative Agent, in sufficient quantity for
distribution by the Administrative Agent to the Lenders, a report setting forth
the results of such evaluation, a proposed plan for responding to any
non-compliance or liability under Environmental Laws described therein, and an
estimate of the costs thereof, and (ii) provide to the Administrative Agent and
the Lenders a supplemental report of such engineer whenever the scope of the
environmental problems, or the response thereto or the estimated costs thereof,
shall increase in any material respect.
(c) If the Administrative Agent has reasonably concluded that
there may be a condition of material non-compliance or material liability under
Environmental Laws, the Administrative Agent and its representatives will have
the right at any reasonable time upon reasonable notice to enter and visit the
Real Estate and any other place where any property of the Borrowers is located
for the purposes of observing the Real Estate, taking and removing soil or
groundwater samples, and conducting tests on any part of the Real Estate. The
Administrative Agent is under no duty, however, to visit or observe the Real
Estate or to conduct tests, and any such acts by the Administrative Agent will
be solely for the purposes of protecting the Administrative Agent's Liens and
preserving the Administrative Agent and the Lenders' rights under the Loan
Documents. No site visit, observation or testing by the Administrative Agent and
the Lenders will result in a waiver of any default of the Borrowers or impose
any liability on the Administrative Agent or the Lenders. In no event will any
site visit, observation or testing by the Administrative Agent be a
representation that hazardous substances are or are not present in, on or under
the Real Estate, or that there has been or will be compliance with any
Environmental Law. Neither the Borrowers nor any other party are entitled to
rely on any site visit, observation or testing by the Administrative Agent. The
Administrative Agent and the Lenders owe no duty of care to protect the
Borrowers or any other party against, or to inform the Borrowers or any other
party of, any hazardous substances or any other adverse condition affecting the
Real Estate. The Administrative Agent may in its discretion disclose to the
Borrowers, to the Lenders or, if so required by law, to any other party any
report or findings made as a result of, or in connection with, any site visit,
observation or testing by the Administrative Agent. The Borrowers understand and
agree that the Administrative Agent makes no warranty or representation to the
Borrowers or any other party regarding the truth, accuracy or completeness of
any such report or findings that may be disclosed. The Borrowers also understand
that depending on the results of
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any site visit, observation or testing by the Administrative Agent and disclosed
to the Borrowers, the Borrowers may have a legal obligation to notify one or
more environmental agencies of the results, that such reporting requirements are
site-specific, and are to be evaluated by the Borrowers without advice or
assistance from the Administrative Agent. In each instance, the Administrative
Agent will give the Borrowers reasonable notice before entering the Real Estate
or any other place the Administrative Agent is permitted to enter under this
SECTION 7.7(C). The Administrative Agent will make reasonable efforts to avoid
interfering with the Borrowers' use of the Real Estate or any other property in
exercising any rights provided hereunder.
7.8 COMPLIANCE WITH ERISA. The Borrowers shall, and shall cause each of
their ERISA Affiliates to: (a) maintain each Plan in compliance in all material
respects with the applicable provisions of ERISA, the Code and other federal or
state law; (b) cause each Plan which is qualified under Section 401(a) of the
Code to maintain such qualification; (c) make all required contributions to any
Plan subject to Section 412 of the Code; (d) not engage in a prohibited
transaction (as defined in Sections 406 of ERISA and 4975 of the Code) or
violation of the fiduciary responsibility rules with respect to any Plan; and
(e) not engage in a transaction that could be subject to Section 4069 or 4212(c)
of ERISA.
7.9 MERGERS, CONSOLIDATIONS OR SALES. None of the Borrowers nor any of
their respective Subsidiaries shall enter into any transaction of merger,
reorganization, or consolidation, or transfer, sell, assign, lease, or otherwise
dispose of all or any part of its property, or wind up, liquidate or dissolve,
or agree to do any of the foregoing, except (i) for sales of Inventory in the
ordinary course of its business, (ii) the merger in Brazil of Newco Fibre Brazil
into Unifrax Brazil, with it being the survivor, in connection with the
transactions related to the Purchase Agreement, and (iii) for sales or other
dispositions of Equipment in the ordinary course of business that are obsolete
or no longer useable by the Borrowers in their business with an orderly
liquidation value not to exceed $200,000 in any Fiscal Year. Within 180 days
following each such Equipment sale or disposition, the Borrowers shall either
(i) reinvest the proceeds of that sale or disposition in other Equipment or (ii)
apply such proceeds to the Loans in accordance with SECTIONS 3.3(B) AND (C). All
Equipment purchased with such proceeds shall be free and clear of all Liens,
except the Administrative Agent's Liens, Permitted Liens and Liens permitted by
SECTION 7.18.
7.10 DISTRIBUTIONS; CAPITAL CHANGE; RESTRICTED INVESTMENTS. None of the
Borrowers nor any of their respective Subsidiaries shall (a) directly or
indirectly declare or make, or incur any liability to make, or vote any
resolution regarding, any Distribution, except Distributions to the Borrowers by
their direct or indirect Subsidiaries, (b) make any change in its capital
structure which could reasonably be expected to have a Material Adverse Effect,
or (c) make any Restricted Investment, PROVIDED, HOWEVER,
(i) at any time during which there exists no Event of Default
which is continuing, the Parent may pay (A) dividends to Holdings to
enable Holdings to pay its reasonable and ordinary course operating and
administrative expenses (other than corporate income taxes), including,
without limitation, directors fees, legal and audit expenses,
Securities and Exchange Commission compliance expenses, and other
similar corporate overhead costs and expenses, PROVIDED, HOWEVER, that
the same (other than taxes) shall not exceed in any Fiscal Year One
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Hundred Thousand Dollars ($100,000), and (B) dividends to Holdings on
the Holdings Preferred Stock to the extent used by Holdings to pay
accrued and unpaid interest on the Holdings Note,
(ii) the Borrowers and their Subsidiaries may maintain the
Investments outstanding on the date hereof and listed on SCHEDULE 7.10,
(iii) the Borrowers and their Subsidiaries may extend credit
in the nature of accounts or notes receivable arising from the sale of
goods and services in the ordinary course of business,
(iv) the Borrowers and their Subsidiaries may maintain
Investments consisting of shares of stock, obligations or other
securities received in settlement of claims arising in the ordinary
course of business, but only if no Event of Default would arise under
any other provision of this Agreement,
(v) the Borrowers may make Permitted Intercompany Advances,
(vi) any Borrower may acquire shares of a Borrower (other than
the Parent) solely in exchange for the shares of the capital stock of a
Borrower (other than the Parent),
(vii) the Parent may pay dividends in amounts, not to exceed
$300,000 in any Fiscal Year, to be used by Holdings to repurchase stock
from managers and employees pursuant to the terms of employee stock
option and stockholder plans entered into in the ordinary course of
business, and
(vii) the Parent may repay the Subordinated Real Estate Note -
Seller with the proceeds of the Term Loan (UK) Additional Advance in
accordance with Section 6.22.
(d) the Parent may make payments to Holdings under its Tax
Sharing Agreement with the Parent.
7.11 TRANSACTIONS AFFECTING COLLATERAL OR OBLIGATIONS. None of the
Borrowers nor any of their respective Subsidiaries shall enter into any
transaction which would be reasonably expected to have a Material Adverse
Effect.
7.12 GUARANTIES. Neither the Borrowers nor any of their respective
Subsidiaries shall make, issue, or become liable on any Guaranty, except (i)
Guaranties of the Obligations in favor of the Administrative Agent (ii) the
endorsement, in the ordinary course of business, of instruments payable to it or
its order, (iii) Guarantees of loans and advances by third parties to employees
of any Borrower or its Subsidiaries for bona fide business purposes provided
that the aggregate amount of new guarantees outstanding at any time does not
exceed $250,000, (iv) Guaranties of obligations by any Borrower or any
Subsidiary of any other Borrower or Subsidiary provided that the aggregate
amount of new guarantees outstanding at any time does not exceed $250,000, and
(v) the guarantee by the Parent of the Holdings Note; PROVIDED, HOWEVER, that
all Guaranties shall be unsecured except by Permitted Liens.
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7.13 DEBT. The Parent and its Subsidiaries in the aggregate shall not
incur or maintain any Debt, other than: (a) the Obligations; (b) the obligations
of Parent in respect of the Senior Notes, (c) the obligations of Parent with
respect to the Subordinated Debt - Seller or under the Subordinated Real Estate
Note - Seller, (d) Debt described on SCHEDULE 7.13 and any refinancing thereof
that does not increase the principal amount thereof and that is on terms
substantially no less favorable than those refinanced; (e) Permitted
Intercompany Advances; (f) Capital Leases of Equipment and purchase money
secured Debt incurred to purchase Equipment; provided that (i) Liens securing
the same attach only to the Equipment acquired by the incurrence of such Debt,
and (ii) the aggregate amount of such Debt (including Capital Leases)
outstanding does not exceed $1,000,000 or the Foreign Currency Equivalent
thereof for the Parent and its Subsidiaries in the aggregate; (g) Debt permitted
under SECTIONS 7.10 or 7.12; (h) the UK/Brazil Intercompany Advance and the
US/UK Intercompany Advance; (i) the Hedge Agreement with respect to the Term
Loan (France) described in SECTION 7.27 (Hedge Agreements) and other Hedge
Agreements entered into by the Parent and its Subsidiaries in the ordinary
course of their business and in no event for speculative purposes; (j) Debt
evidencing a refunding, renewal or extension of the Debt described on SCHEDULE
7.13; PROVIDED that (i) the principal amount thereof is not increased, (ii) the
Liens, if any, securing such refunded, renewed or extended Debt do not attach to
any assets in addition to those assets, if any, securing the Debt to be
refunded, renewed or extended, (iii) no Person that is not an obligor or
guarantor of such Debt as of the Closing Date shall become an obligor or
guarantor thereof, and (iv) the terms of such refunding, renewal or extension
are no less favorable to the Borrowers, the Administrative Agent or the Lenders
than the original Debt; and (k) additional Debt not to exceed $500,000 in the
aggregate.
7.14 PREPAYMENT. Neither the Borrowers nor any of their respective
Subsidiaries shall voluntarily prepay any Debt, except the Obligations in
accordance with the terms of this Agreement and except the repayment of the
Subordinated Real Estate Note - Seller in accordance with Section 6.22.
7.15 TRANSACTIONS WITH AFFILIATES. Except as set forth below, except
for the UK/Brazil Intercompany Advance and for Permitted Intercompany Advances
which satisfy all criteria contained in the definition thereof and except as set
forth in SECTION 7.16, neither the Borrowers nor any of their respective
Subsidiaries shall, sell, transfer, distribute, or pay any money or property,
including, but not limited to, any fees or expenses of any nature (including,
but not limited to, any fees or expenses for management services), to any
Affiliate, or lend or advance money or property to any Affiliate, or invest in
(by capital contribution or otherwise) or purchase or repurchase any stock or
indebtedness, or any property, of any Affiliate, or become liable on any
Guaranty of the indebtedness, dividends, or other obligations of any Affiliate;
provided, however, that the provisions of this SECTION 7.15 shall not prohibit
(i) the payment of reasonable fees to the directors of any Borrower or any
Subsidiary determined in good faith and so long as the aggregate of all such
fees paid does not exceed in any fiscal year $100,000, and indemnities provided
on behalf of such directors with respect to the performance of their duties as
directors, (ii) payments permitted by SECTION 7.10, (iii) payments not to exceed
$500,000 in any Fiscal Year made pursuant to the Advisory Services Agreement
with Kirtland Capital Corp., and (iv) payments made with respect to Subordinated
Debt to the extent permitted by the terms of the Subordination Agreement.
Notwithstanding the foregoing, while no Event of Default has occurred and is
continuing, the Borrowers and their Subsidiaries may engage in transactions with
Affiliates in the ordinary course of business consistent with past practices, in
amounts and upon
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terms fully disclosed to the Administrative Agent and the Lenders, and no less
favorable to the Borrowers and their Subsidiaries than would be obtained in a
comparable arm's-length transaction with a third party who is not an Affiliate.
7.16 INVESTMENT BANKING AND FINDER'S FEES. Except as set forth on
SCHEDULE 7.16, neither the Borrowers nor any of their respective Subsidiaries
shall pay or agree to pay, or reimburse any other party with respect to, any
investment banking or similar or related fee, underwriter's fee, finder's fee,
or broker's fee to any Person in connection with this Agreement or the Purchase
Agreement Documents. The Borrowers shall defend and indemnify the Administrative
Agent and the Lenders against and hold them harmless from all claims of any
Person that the Borrowers are obligated to pay for any such fees, and all costs
and expenses (including attorneys' fees) incurred by the Administrative Agent
and/or any Lender in connection therewith.
7.17 BUSINESS CONDUCTED. The Borrowers shall not and shall not permit
any of their respective Subsidiaries to, engage directly or indirectly, in any
line of business other than the businesses in which the Borrowers are engaged on
the Closing Date and the same and similar fields and businesses and reasonable
extensions thereof.
7.18 LIENS. Neither the Borrowers nor any of their respective
Subsidiaries shall create, incur, assume, or permit to exist any Lien on any
property now owned or hereafter acquired by any of them, except Permitted Liens,
and Liens, if any, in effect as of the Closing Date described in SCHEDULE 7.18
securing Debt described in SCHEDULE 7.18, and Liens securing Capital Leases and
purchase money Debt permitted in SECTION 7.13.
7.19 SALE AND LEASEBACK TRANSACTIONS. Neither the Borrowers nor any of
their respective Subsidiaries shall, directly or indirectly, enter into any
arrangement with any Person providing for such Borrower or such Subsidiary to
lease or rent property that any such Borrower or such Subsidiary has sold or
will sell or otherwise transfer to such Person.
7.20 NEW SUBSIDIARIES. The Borrowers shall not, directly or indirectly,
organize, create, acquire or permit to exist any Subsidiary other than those
listed on SCHEDULE 6.5.
7.21 FISCAL YEAR The Parent and its Subsidiaries shall not change their
Fiscal Year.
7.22 CAPITAL EXPENDITURES. The Parent and its Subsidiaries collectively
shall NOT make or incur any Capital Expenditure if, after giving effect thereto,
the aggregate amount of all Capital Expenditures by the Parent and its
Subsidiaries on a consolidated basis would exceed $8,500,000 (or the Foreign
Currency Equivalent thereof) during their Fiscal Year ended December 31, 2001;
$9,000,000 (or the Foreign Currency Equivalent thereof) during their Fiscal Year
ended December 31, 2002; and $6,800,000 (or the Foreign Currency Equivalent
thereof) during their Fiscal Year ended December 31, 2003, plus, for any Fiscal
Year where, in the immediately preceding Fiscal Year, the amount of such Capital
Expenditures allowed above exceeded the amount of the actual Capital
Expenditures, 50% of such excess in such immediately preceding Fiscal Year.
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7.23 FIXED CHARGE COVERAGE RATIO.
(a) Parent and its Subsidiaries will maintain a Fixed Charge
Coverage Ratio for each period of four preceding consecutive fiscal quarters
ended on the last day of each fiscal quarter during the fiscal year set forth
below (or with respect to the fiscal quarters ending before December, 31, 2001,
the period commencing on the Closing Date and ending on the last day of such
fiscal quarter) of not less than the ratio set forth below:
EACH FISCAL QUARTER FIXED CHARGE
------------------- ------------
DURING FISCAL YEAR ENDING COVERAGE RATIO
------------------------- --------------
December 31, 2000 1.15 to 1.0
December 31, 2001 1.15 to 1.0
December 31, 2002 1.20 to 1.0
December 31, 2003 1.25 to 1.0
(b) The Parent, individually, will maintain a Fixed Charge
Coverage Ratio for each period of four consecutive fiscal quarters ended on the
last day of each fiscal quarter during the fiscal year set forth below (or with
respect to the fiscal quarters ending before December 31, 2000, the period
commencing on the Closing Date and ending on the last day of such fiscal
quarter) of not less than 1.1 to 1.0.
(c) The UK Borrowers, collectively, will maintain a Fixed
Charge Coverage Ratio for each period of four preceding consecutive fiscal
quarters ended on the last day of each fiscal quarter hereafter (or with respect
to the fiscal quarters ending before December 31, 2000, the period commencing on
the Closing Date and ending on the last day of such fiscal quarter) of not less
than 1.0 to 1.0 through and including June 30, 2001, and not less than 1.1 to
1.0 thereafter. If for any period of determination, the UK Borrowers do not
comply with such Fixed Charge Coverage Ratio, the Fixed Charge Coverage Ratio
may be recomputed by adding to EBITDA for the period of determination the amount
of loans and advances received by the UK Borrowers from the Parent or its direct
or indirect Subsidiaries within fifteen (15) days after the certificate due
under SECTION 5.2(D) was furnished, BUT ONLY IF:
(i) if received from the Parent, (A) after giving effect to
the loans and advances, the Parent must have US Availability of not
less than $4,000,000, (B) the Fixed Charge Coverage Ratio required in
SECTION 7.23(B) above for the same period of determination shall be
recomputed by adding the amount of such loans and advances to the
Parent's Fixed Charges, and (C) the loans and advances must be
Permitted Intercompany Advances; and
(ii) if from a direct or indirect Subsidiary of the Parent,
the loans and advances must be Permitted Intercompany Advances.
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7.24 FUNDED DEBT TO EBITDA.
The Parent and its Subsidiaries will maintain a ratio of Funded Debt
to EBITDA for each period of four preceding consecutive fiscal quarters ended on
the last day of each fiscal quarter during the fiscal year set forth below
(provided, for any testing period ending before September 30, 2001, EBITDA shall
be annualized for such testing period) of not less than the ratio set forth
below:
Each Fiscal Quarter Funded Debt to
During Fiscal Year Ending Ebitda Ratio
------------------------- ------------
December 31, 2001 4.25 to 1.0
December 31, 2002 4.0 to 1.0
December 31, 2003 3.5 to 1.0
7.25 INTEREST COVERAGE RATIO. Parent and its Subsidiaries will maintain
a Interest Coverage Ratio for each period of four preceding consecutive fiscal
quarters ended on the last day of each fiscal quarter during the fiscal year set
forth below (or with respect to the fiscal quarters ending before December, 31,
2001, the period commencing on the Closing Date and ending on the last day of
such fiscal quarter) of not less than the ratio set forth below:
Each Fiscal Quarter Interest
During Fiscal Year Ending Coverage Ratio
------------------------- --------------
December 31, 2000 1.75 to 1.0
December 31, 2001 1.75 to 1.0
December 31, 2002 2.00 to 1.0
December 31, 2003 2.25 to 1.0
7.26 USE OF PROCEEDS. The Borrowers shall not, and shall not suffer or
permit any Subsidiary to, use any portion of the Loan proceeds, directly or
indirectly, (i) to purchase or carry Margin Stock, (ii) to repay or otherwise
refinance indebtedness of the Borrowers or others incurred to purchase or carry
Margin Stock, (iii) to extend credit for the purpose of purchasing or carrying
any Margin Stock, or (iv) to acquire any security in any transaction that is
subject to Section 13 or 14 of the Exchange Act.
7.27 HEDGE AGREEMENTS.
If required by the Required Lenders, the Parent and the French
Borrower shall enter into a Hedge Agreement to protect against erosion of the
Dollar value of the Collateral provided by the Parent relative to the increase
in value of the Euro, in which the French
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Obligations are denominated, to the Dollar, in which the Parent's assets
providing security for the French Obligations are denominated, in an amount
acceptable to the Lenders.
7.28 FURTHER ASSURANCES. The Borrowers shall execute and deliver, or
cause to be executed and delivered, to the Administrative Agent such documents
and agreements, and shall take or cause to be taken such actions, as the
Administrative Agent or any Lender may, from time to time, reasonably request to
carry out the terms and conditions of this Agreement and the other Loan
Documents.
ARTICLE 8
CONDITIONS OF LENDING
---------------------
8.1 CONDITIONS PRECEDENT TO MAKING OF LOANS ON THE CLOSING DATE. The
obligation of the Lenders to make the initial Revolving Loans and the Term Loan
(France) and the Term Loan (UK) Initial Advance on the Closing Date, the
obligation of the Administrative Agent to issue the Brazilian Letter of Credit
on the Closing Date, and the obligation of the Administrative Agent to cause the
Letter of Credit Issuer to issue any Letter of Credit on the Closing Date, are
subject to the following conditions precedent having been satisfied in a manner
satisfactory to the Administrative Agent and each Lender:
(a) This Agreement and the other Loan Documents shall have
been executed by each party thereto and the Borrowers shall have performed and
complied with all covenants, agreements and conditions contained herein and the
other Loan Documents which are required to be performed or complied with by the
Borrowers before or on such Closing Date.
(b) Upon making the Revolving Loans (including such Revolving
Loans made to finance the Closing Fee or otherwise as reimbursement for fees,
costs and expenses then payable under this Agreement) and the Term Loans (the
maximum amount of the Term Loan (UK) being deemed to have been advanced for the
purposes of this computation only) and with all its obligations current, the
Borrowers shall have aggregate US Availability and the Dollar Equivalent of UK
Availability of at least $7,500,000 (the "Minimum Availability").
(c) All representations and warranties made hereunder and in
the other Loan Documents shall be true and correct in all material respects as
if made on such date.
(d) No Default or Event of Default shall have occurred and be
continuing after giving effect to the Loans to be made and the Brazilian Letter
of Credit and the Letters of Credit to be issued on the Closing Date.
(e) The Administrative Agent and the Lenders shall have
received such opinions of counsel for the Borrowers and their Subsidiaries as
the Administrative Agent or any Lender shall request, each such opinion to be in
a form, scope, and substance satisfactory to the Administrative Agent, the
Lenders, and their respective counsel.
(f) The Administrative Agent shall have received title
policies, in form and substance acceptable to Administrative Agent, with respect
to the Mortgages.
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(g) The Administrative Agent shall have received:
(i) acknowledgment copies of proper financing
statements, duly filed on or before the Closing Date under the UCC of all
jurisdictions that the Administrative Agent may deem necessary or desirable in
order to perfect the Administrative Agent's Liens; and
(ii) duly executed UCC-3 Termination Statements and
such other instruments, in form and substance satisfactory to the Administrative
Agent, as shall be necessary to terminate and satisfy all Liens on the Property
of the Borrowers and their Subsidiaries except Permitted Liens.
(h) The Borrowers shall have paid all fees and expenses of the
Administrative Agent and the Attorney Costs incurred in connection with any of
the Loan Documents and the transactions contemplated thereby to the extent
invoiced.
(i) The Administrative Agent shall have received evidence, in
form, scope, and substance, reasonably satisfactory to the Administrative Agent,
of all insurance coverage as required by this Agreement.
(j) The Administrative Agent and the Lenders shall have had an
opportunity, if they so choose, to examine the books of account and other
records and files of the Borrowers and to make copies thereof, and to conduct a
pre-closing audit which shall include, without limitation, verification of
Inventory, Accounts, and the Borrowing Base, and the results of such examination
and audit shall have been satisfactory to the Administrative Agent and the
Lenders in all respects.
(k) The Administrative Agent shall have received a written
explanation of the nature of the existing litigation and related indemnification
provisions and procedures, all in form and substance satisfactory to the
Administrative Agent.
(l) All proceedings taken in connection with the execution of
this Agreement, the Term Loan Notes, all other Loan Documents and all documents
and papers relating thereto shall be satisfactory in form, scope, and substance
to the Administrative Agent and the Lenders.
(m) With respect to the Purchase Agreement Transaction:
(i) The Purchase Agreement Transaction shall have
been completed and closed prior to or simultaneously herewith, upon terms and
conditions previously disclosed to and approved by the Lenders, in accordance
with the Purchase Agreement and applicable Laws.
(ii) The Administrative Agent shall have received
photocopies of all Purchase Agreement Documents executed, delivered and/or
furnished in connection with the Purchase Agreement Transaction, together with a
certificate signed by a Responsible Officer of each of the Borrowers certifying
that the Purchase Agreement and the other Purchase Agreement Documents furnished
to the Administrative Agent are true, correct, in full force and effect and the
provisions thereof have not been in any way modified, amended or waived, and the
Purchase Agreement Transaction has been closed and completed in accordance with
the Purchase
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Agreement and the other Purchase Agreement Documents furnished to the
Administrative Agent and in accordance with all applicable Laws.
(iii) The Administrative Agent shall have received a
reliance letter in form and substance acceptable to the Administrative Agent in
its sole and absolute discretion, executed and delivered by the Seller, which
reliance letter shall grant to the Administrative Agent and the Lenders the
benefit of all of the rights, warranties, and indemnifications benefiting any or
all of the Borrowers under and in connection with the Purchase Agreement, the
other Purchase Agreement Documents and the Purchase Agreement Transaction. In
addition, the Administrative Agent shall have received any and all opinions of
counsel for the Seller and the Borrowers required under or in connection with
the Purchase Agreement, the other Purchase Agreement Documents and the Purchase
Agreement Transaction, upon which opinions, if any, the Administrative Agent and
the Lenders shall be expressly entitled to rely.
The acceptance by the Borrowers of any Loans made or the
Brazilian Letter of Credit and any Letters of Credit issued on the Closing Date
shall be deemed to be a representation and warranty made by the Borrowers to the
effect that all of the conditions precedent to the making of such Loans or the
issuance of such Letters of Credit have been satisfied, with the same effect as
delivery to the Administrative Agent and the Lenders of a certificate signed by
a Responsible Officer of the Borrowers, dated the Closing Date, to such effect.
Execution and delivery to the Administrative Agent by a Lender
of a counterpart of this Agreement shall be deemed confirmation by such Lender
that (i) all conditions precedent in this SECTION 8.1 have been fulfilled to the
satisfaction of such Lender, (ii) the decision of such Lender to execute and
deliver to the Administrative Agent an executed counterpart of this Agreement
was made by such Lender independently and without reliance on the Administrative
Agent or any other Lender as to the satisfaction of any condition precedent set
forth in this SECTION 8.1, and (iii) all documents sent to such Lender for
approval consent, or satisfaction were acceptable to such Lender.
8.2 CONDITIONS PRECEDENT TO MAKING TERM LOAN (UK) ADDITIONAL ADVANCE.
The obligation of the Lenders to make the Term Loan (UK) Additional Advance is
subject to the following conditions precedent having been satisfied in a manner
reasonably satisfactory to the Administrative Agent and each Lender:
(a) The Administrative Agent shall have been registered as the
proprietor of the registered Mortgage (UK).
(b) With respect to the Mortgage (UK), the Administrative
Agent and the Lenders shall have received such opinions and reports of good and
marketable title from counsel for the UK Borrowers and their Subsidiaries and
for the Administrative Agent as the Administrative Agent or any Lender shall
request, each such opinion and report to be, in all respects in a form, scope,
and substance satisfactory to the Administrative Agent, the Lenders, and their
respective counsel, which opinions and reports shall confirm the assumptions
upon which the appraisal described in subsection (c) below is based.
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(c) The Administrative Agent shall have received a fair market
appraisal in form and substance and from an appraiser acceptable to
Administrative Agent, with respect to the Real Property covered by the Mortgage
(UK), containing assumptions which confirming, inter alia, the reports on title
and opinions received.
(d) The UK Borrowers shall have paid all fees and expenses of
the Administrative Agent and the Attorney Costs incurred in connection with any
of the Mortgage (UK).
(e) The Administrative Agent shall be satisfied that leases
and other encumbrances on the property covered by the Mortgage (UK) do not
adversely affect the value of such property or the ability of the Administrative
Agent to foreclose under the Mortgage (UK), which satisfaction may be
conditioned on, inter alia the agreement by the Seller to amend provisions of
the title transfer documents and general service agreements applicable to the
property subject to the Mortgage (UK) which the Administrative Agent may
reasonably determine to be desirable.
(f) The Administrative Agent shall have received such further
certificates, agreements, opinions, reports and other documents as the
Administrative Agent may reasonably require with respect to the Mortgage (UK)
and the Real Property covered thereby.
8.3 CONDITIONS PRECEDENT TO EACH LOAN. The obligation of the Lenders to
make each Loan, including the initial Revolving Loans on the Closing Date and
the Term Loans, the obligation of the Administrative Agent to cause the Letter
of Credit Issuer to issue the Brazilian Letter of Credit, and the obligation of
the Administrative Agent to cause the Letter of Credit Issuer to issue any
Letter of Credit shall be subject to the further conditions precedent that on
and as of the date of any such extension of credit:
(a) the following statements shall be true, and the acceptance
by the Borrowers of any extension of credit shall be deemed to be a statement to
the effect set forth in CLAUSES (I) and (II), with the same effect as the
delivery to the Administrative Agent and the Lenders of a certificate signed by
a Responsible Officer, dated the date of such extension of credit, stating that:
(i) The representations and warranties contained in
this Agreement and the other Loan Documents are correct in all material respects
on and as of the date of such extension of credit as though made on and as of
such date, other than any such representation or warranty which relates to a
specified prior date and except to the extent the Administrative Agent and the
Lenders have been notified by the Borrowers that any representation or warranty
is not correct and the Required Lenders have explicitly waived in writing
compliance with such representation or warranty; and
(ii) No event has occurred and is continuing, or
would result from such extension of credit, which constitutes a Default or an
Event of Default; and
(iii) No event has occurred and is continuing, or
would result from such extension of credit, which would have a Material Adverse
Effect.
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(b) The amount of the US Borrowing Base shall be sufficient to
make such US Revolving Loans or issue such US Letters of Credit without
exceeding the US Availability and the amount of the UK Borrowing Base shall be
sufficient to make such UK Revolving Loans or issue such UK Letters of Credit
without exceeding the UK Availability; PROVIDED, HOWEVER, that the foregoing
conditions precedent are not (i) conditions to each Lender participating in or
reimbursing the Bank or the Administrative Agent for such Lenders' Pro Rata
Share of any Non-Ratable Loan or Administrative Agent Advance made in accordance
with the provisions of SECTIONS 1.2(K) and 1.2(l) or (ii) conditions to any
advance made under SECTION 1.2(C) (Advances in excess of US Availability/UK
Availability).
ARTICLE 9
DEFAULT; REMEDIES
-----------------
9.1 EVENTS OF DEFAULT. It shall constitute an event of default ("Event
of Default") if any one or more of the following shall occur for any reason:
(a) any failure by the Borrowers to pay the principal of any
Loan when due, or to pay when due interest or premium on any of the Obligations
or any fee or other amount owing under the Obligations when due, whether upon
demand or otherwise;
(b) any representation or warranty made or deemed made by the
Borrowers in this Agreement or by the Borrowers or any of their Subsidiaries in
any of the other Loan Documents, any Financial Statement, or any certificate
furnished by the Borrowers or any of their Subsidiaries at any time to the
Administrative Agent or any Lender shall prove to be untrue in any material
respect as of the date on which made, deemed made, or furnished;
(c) any default shall occur in the observance or
performance of any of the covenants and agreements contained in SECTIONS 7.2,
7.5, 7.9 through 7.26, inclusive, or Section 11 of the Security Agreement, (ii)
any default shall occur in the observance or performance of any of the covenants
and agreements contained in SECTIONS 5.25.3 (other than 5.2(F)), 5.3, and such
default shall continue for five (5) days or more; (iii) any default shall occur
in the observance or performance of any of the covenants and agreements
contained in SECTIONS 5.2(F), and such default shall continue for three (3) days
or more; or (iv) any default shall occur in the observance or performance of any
of the other covenants or agreements contained in any other Section of this
Agreement or any other Loan Document, any other Loan Documents, or any other
agreement entered into at any time to which any Borrower or any Subsidiary and
the Administrative Agent or any Lender are party (including in respect of any
Bank Products) and such default shall continue for fifteen (15) days or more;
(d) any default shall occur with respect to any Debt (other
than the Obligations) which the Parent and its Subsidiaries are permitted to
incur under SECTION 7.13 (Debt) and which has an outstanding principal amount
that exceeds $500,000 or the Foreign Currency Equivalent thereof, or (ii) under
any agreement or instrument under or pursuant to which any such Debt may have
been issued, created, assumed, or guaranteed by any Borrower or any Subsidiary,
and such default shall continue for more than the period of grace, if any,
therein specified, if the effect thereof (with or without the giving of notice
or further lapse of time or
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both) is to accelerate, or to permit the holders of any such Debt to accelerate,
the maturity of any such Debt; or any such Debt shall be declared due and
payable or be required to be prepaid (other than by a regularly scheduled
required prepayment) prior to the stated maturity thereof;
(e) any Borrower or any Subsidiary shall (i) file a voluntary
petition in bankruptcy or pass any resolution for winding-up or administration
or file a voluntary petition or an answer or otherwise commence any action or
proceeding seeking reorganization, arrangement or readjustment of its debts or
for any other relief under the federal Bankruptcy Code, as amended, or, in the
case of UK Holdco, and Unifrax UK, under the Insolvency Act of 1986, or any
other bankruptcy or insolvency act or law, state or federal, now or hereafter
existing, or consent to, approve of, or acquiesce in, any such petition, action
or proceeding; (ii) apply for or acquiesce in the appointment of a receiver,
assignee, liquidator, sequestrator, custodian, monitor, trustee, administrator,
administrative receiver or manager or similar officer for it or for all or any
part of its property; (iii) make an assignment, composition or arrangement for
the benefit of creditors; or (iv) be unable generally to pay its debts as they
become due;
(f) an involuntary petition shall be filed or an action or
proceeding otherwise commenced seeking reorganization, arrangement,
consolidation, composition or arrangement or readjustment of the debts of any
Borrower or any Subsidiary or for any other relief under the federal Bankruptcy
Code, as amended, or, in the case of UK Holdco, and Unifrax UK, under the
Insolvency Act of 1986, or any other bankruptcy or insolvency act or law, state
or federal, now or hereafter existing and such petition or proceeding shall not
be dismissed within sixty (60) days after the filing or commencement thereof or
an order of relief shall be entered with respect thereto;
(g) a receiver, assignee, liquidator, sequestrator, custodian,
monitor, trustee administrator, administrative receiver or manager or similar
officer for any Borrower or any Subsidiary or for all or any part of its
property shall be appointed, and the same shall continue undischarged for a
period of sixty (60) days or a warrant of attachment, execution, distress,
sequestration or similar process shall be issued against any part of the
property of any Borrower or any Subsidiary;
(h) any Borrower or any Subsidiary shall file a certificate of
dissolution under applicable state law or pass any resolution for its winding-up
or administration, or shall be liquidated, dissolved or wound-up or shall
commence or have commenced against it any action or proceeding for dissolution,
winding-up, administration or liquidation, or shall take any corporate action in
furtherance thereof;
(i) all or any part of the property of any Borrower or any
Subsidiary having a value of $500,000 or the Foreign Currency Equivalent
thereof, shall be nationalized, expropriated or condemned, seized or otherwise
appropriated, or custody or control of such property or of such Borrower or such
Subsidiary shall be assumed by any Governmental Authority or any court of
competent jurisdiction at the instance of any Governmental Authority, except
where contested in good faith by proper proceedings diligently pursued where a
stay of enforcement is in effect;
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(j) Any Borrower, any guarantor, pledgor or other obligor with
respect to the Obligations shall challenge the validity and binding effect of
any provision of any of the Loan Documents or shall state its intention to make
such a challenge of any of the Loan Documents or any of the Loan Documents shall
for any reason (except to the extent permitted by its express terms) cease to be
effective;
(k) one or more judgments, orders, decrees or arbitration
awards is entered against the Borrowers involving in the aggregate liability (to
the extent not covered by independent third-party insurance as to which the
insurer does not dispute coverage) as to any single or related or unrelated
series of transactions, incidents or conditions, of $500,000 against the Parent,
(pound)350,000 against the UK Borrowers, collectively, or Euro 425,000 against
the French Borrower or more, and the same shall remain unsatisfied, unvacated
and unstayed pending appeal for a period of thirty (30) days after the entry
thereof;
(l) any loss, theft, damage or destruction of any item or
items of Collateral or other property of any Borrower or any Subsidiary occurs
which could reasonably be expected to cause a Material Adverse Effect and is not
adequately covered by insurance;
(m) there is filed against any Borrower or any Subsidiary any
action, suit or proceeding under any federal or state racketeering statute
(including the Racketeer Influenced and Corrupt Organization Act of 1970), which
action, suit or proceeding (i) is not dismissed within one hundred twenty (120)
days, and (ii) could reasonably be expected to result in the confiscation or
forfeiture of any material portion of the Collateral;
(n) for any reason, other than the failure of the
Administrative Agent to take any action available to it to maintain perfection
of the Administrative Agent's Liens, pursuant to the Loan Documents, any Loan
Document ceases to be in full force and effect or any Lien with respect to any
material portion of the Collateral intended to be secured thereby ceases to be,
or is not, valid, perfected and prior to all other Liens (other than Permitted
Liens) or is terminated, revoked or declared void;
(o) an ERISA Event shall occur with respect to a Pension Plan
or Multi-employer Plan which has resulted or could reasonably be expected to
result in liability of the Borrowers under Title IV of ERISA to the Pension
Plan, Multi-employer Plan or the PBGC in an aggregate amount in excess of
$500,000; (ii) the aggregate amount of Unfunded Pension Liability among all
Pension Plans at any time exceeds $500,000; or (iii) the Borrowers or any ERISA
Affiliate shall fail to pay when due, after the expiration of any applicable
grace period, any installment payment with respect to its withdrawal liability
under Section 4201 of ERISA under a Multi-employer Plan in an aggregate amount
in excess of $500,000; or
(p) there occurs a Change of Control.
9.2 REMEDIES.
(a) If an Event of Default exists and is continuing, the
Administrative Agent and the Co-Administrative Agent may and shall, at the
direction of the Required Lenders, do one or more of the following at any time
or times and in any order, without notice to or demand on the Borrowers: (i)
reduce the Maximum UK Revolving Loans Amount or the Maximum US
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Revolving Loans Amount, or the advance rates against Eligible Accounts and/or
Eligible Inventory used in computing the Borrowing Base, or reduce one or more
of the other elements used in computing the Borrowing Base; (ii) restrict the
amount of or refuse to make Revolving Loans; and (iii) restrict or refuse to
provide Letters of Credit or Credit Support. If an Event of Default exists and
is continuing, the Administrative Agent shall, at the direction of the Required
Lenders, do one or more of the following, in addition to the actions described
in the preceding sentence, at any time or times and in any order, without notice
to or demand on the Borrowers: (A) terminate the Commitments and this Agreement;
(B) declare any or all Obligations to be immediately due and payable; PROVIDED,
HOWEVER, that upon the occurrence of any Event of Default described in SECTIONS
9.1(E), 9.1(F), 9.1(G), or 9.1(H), the Commitments shall automatically and
immediately expire and all Obligations shall automatically become immediately
due and payable without notice or demand of any kind; and (C) pursue its other
rights and remedies under the Loan Documents and applicable law. The
Administrative Agent may, in the exercise of its discretion from time to time
subject, however, to the express direction of the Required Lenders to the
contrary, pursue the other rights and remedies under the Loan Documents and
applicable law as the Administrative Agent believes is necessary or beneficial
for the preservation of the Collateral, of the Administrative Agent's of the
Lender's rights and remedies with respect thereto and of the other rights and
remedies of the Administrative Agent and the Lenders under this Agreement, the
other Loan Documents or applicable Laws.
(b) If an Event of Default has occurred and is continuing: (i)
the Administrative Agent shall have for the benefit of the Lenders, in addition
to all other rights of the Administrative Agent and the Lenders, the rights and
remedies of a secured party under the Loan Documents and the UCC or the
corresponding provisions of English Commercial Law; (ii) the Administrative
Agent may, at any time, take possession of the Collateral and keep it on the
Borrowers' premises, at no cost to the Administrative Agent or any Lender, or
remove any part of it to such other place or places as the Administrative Agent
may desire, or the Borrowers shall, upon the Administrative Agent's demand, at
the Borrowers' cost, assemble the Collateral and make it available to the
Administrative Agent at a place reasonably convenient to the Administrative
Agent and the applicable Borrower; and (iii) the Administrative Agent may sell
and deliver any Collateral at public or private sales, for cash, upon credit or
otherwise, at such prices and upon such terms as the Administrative Agent deems
advisable, in its sole discretion, and may, if the Administrative Agent deems it
reasonable, postpone or adjourn any sale of the Collateral by an announcement at
the time and place of sale or of such postponed or adjourned sale without giving
a new notice of sale. Without in any way requiring notice to be given in the
following manner, the Borrowers agree that any notice by the Administrative
Agent of sale, disposition or other intended action hereunder or in connection
herewith, whether required by the UCC or otherwise, shall constitute reasonable
notice to the Borrowers if such notice is mailed by registered or certified
mail, return receipt requested, postage prepaid, or is delivered personally
against receipt, at least ten (10) Business Days prior to such action to the
Borrowers' address specified in or pursuant to SECTION 13.8. If any Collateral
is sold on terms other than payment in full at the time of sale, no credit shall
be given against the Obligations until the Administrative Agent or the Lenders
receive payment, and if the buyer defaults in payment, the Administrative Agent
may resell the Collateral without further notice to the Borrowers. In the event
the Administrative Agent seeks to take possession of all or any portion of the
Collateral by judicial process, the Borrowers irrevocably waive: (A) the posting
of any bond, surety or security with respect thereto which might otherwise be
required; (B) any demand for possession prior to the
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commencement of any suit or action to recover the Collateral; and (C) any
requirement that the Administrative Agent retain possession and not dispose of
any Collateral until after trial or final judgment. The Borrowers agree that the
Administrative Agent has no obligation to preserve rights to the Collateral or
marshal any Collateral for the benefit of any Person. The Administrative Agent
is hereby granted a license or other right to use, without charge, the
Borrowers' labels, patents, copyrights, name, trade secrets, trade names,
trademarks, and advertising matter, or any similar property, to the extent
reasonably necessary or desirable in completing production of, advertising or
selling any Collateral, and the Borrowers' rights under all licenses and all
franchise agreements shall inure to the Administrative Agent's benefit for such
express purpose. The proceeds of sale shall be applied first to all expenses of
sale, including reasonable attorneys' fees, and then to the Obligations. The
Administrative Agent will return any excess to the Borrowers and the Borrowers
shall remain liable for any deficiency.
(c) If an Event of Default occurs, the Borrowers hereby waive
all rights to notice and hearing prior to the exercise by the Administrative
Agent of the Administrative Agent's rights to repossess the Collateral without
judicial process or to reply, attach or levy upon the Collateral without notice
or hearing.
ARTICLE 10
TERM AND TERMINATION
--------------------
10.1 TERM AND TERMINATION. The term of this Agreement shall end on the
Stated Termination Date unless sooner terminated in accordance with the terms
hereof. The Administrative Agent upon direction from the Required Lenders may
terminate this Agreement without notice upon the occurrence and during the
continuance of an Event of Default. Upon the effective date of termination of
this Agreement for any reason whatsoever, all Obligations (including all unpaid
principal, accrued and unpaid interest and any early termination or prepayment
fees or penalties) shall become immediately due and payable and the Borrowers
shall immediately arrange for the cancellation and return of Letters of Credit
then outstanding. Notwithstanding the termination of this Agreement, until all
Obligations are indefeasibly paid and performed in full in cash, the Borrowers
shall remain bound by the terms of this Agreement and shall not be relieved of
any of their Obligations hereunder or under any other Loan Document, and the
Administrative Agent and the Lenders shall retain all their rights and remedies
hereunder (including the Administrative Agent's Liens in and all rights and
remedies with respect to all then existing and after-arising Collateral).
ARTICLE 11
AMENDMENTS; WAIVERS; PARTICIPATIONS; ASSIGNMENTS; SUCCESSORS
------------------------------------------------------------
11.1 AMENDMENTS AND WAIVERS.
(a) No amendment or waiver of any provision of this Agreement
or any other Loan Document, and no consent with respect to any departure by the
Borrowers therefrom, shall be effective unless the same shall be in writing and
signed by the Required Lenders (or by the Administrative Agent at the written
request of the Required Lenders) and the Borrowers and then
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any such waiver or consent shall be effective only in the specific instance and
for the specific purpose for which given; PROVIDED, HOWEVER, that no such
waiver, amendment, or consent shall, unless in writing and signed by all the
Lenders and the Borrowers and acknowledged by the Administrative Agent, do any
of the following:
(i) increase or extend the Commitment of any Lender;
(ii) postpone or delay any date fixed by this
Agreement or any other Loan Document for any payment of principal, interest,
fees or other amounts due to the Lenders (or any of them) hereunder or under any
other Loan Document (provided that any mandatory prepayment may be deferred or
waived with the consent of Required Lenders);
(iii) reduce the principal of, or the rate of
interest specified herein on any Loan, or any fees or other amounts payable
hereunder or under any other Loan Document;
(iv) change the percentage of the Commitments or of
the aggregate unpaid principal amount of the Loans which is required for the
Lenders or any of them to take any action hereunder;
(v) increase any of the percentages set forth in the
definition of the Borrowing Base;
(vi) amend this Section or any provision of this
Agreement providing for consent or other action by all Lenders;
(vii) release Collateral other than as permitted by
SECTION 12.11;
(viii) change the definitions of "Majority Lenders"
or "Required Lenders"; or
(ix) increase the Maximum US Revolving Loans Amount,
the Maximum UK Revolving Loans Amount, the Maximum US Inventory Loan Amount, the
Maximum UK Inventory Loan Amount, the US Letter of Credit Subfacility and the UK
Letter of Credit Subfacility;
PROVIDED, HOWEVER, the Administrative Agent may, in its sole discretion and
notwithstanding the limitations contained in CLAUSES (V) and (IX) above and any
other terms of this Agreement, make Administrative Agent Advances in accordance
herewith and, PROVIDED FURTHER, that no amendment, waiver or consent shall,
unless in writing and signed by the Administrative Agent, affect the rights or
duties of the Administrative Agent under this Agreement or any other Loan
Document and PROVIDED FURTHER, that the pro rata shares of the Lenders may be
amended from time to time by Administrative Agent alone to reflect assignments
of Commitments in accordance herewith.
(b) As further set forth in Section 1.4(a) (Brazilian Lender's
Agreement), this Agreement and the other Loan Documents may be as amended,
modified, restated, substituted, extended and renewed from time to time without
notice to or consent of the Brazilian Lender or Unifrax Brazil.
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(c) If any fees are paid to the Lenders as consideration for
amendments, waivers or consents with respect to this Agreement, at
Administrative Agent's election, such fees may be paid only to those Lenders
that agree to such amendments, waivers or consents within the time specified for
submission thereof.
(d) If, in connection with any proposed amendment, waiver or
consent (a "Proposed Change"):
(i) requiring the consent of all Lenders, the consent
of Required Lenders is obtained, but the consent of other Lenders is not
obtained (any such Lender whose consent is not obtained as described in this
clause (i) and in clause (ii) below being referred to as a "Non-Consenting
Lender"), or
(ii) requiring the consent of Required Lenders, the
consent of Majority Lenders is obtained,
then, so long as the Administrative Agent is not a Non-Consenting Lender, at the
Borrowers' request, the Administrative Agent or an Eligible Assignee shall have
the right (but not the obligation) with the Administrative Agent's approval, to
purchase from the Non-Consenting Lenders, and the Non-Consenting Lenders agree
that they shall sell, all the Non-Consenting Lenders' Commitments for an amount
equal to the principal balances thereof and all accrued interest and fees with
respect thereto through the date of sale pursuant to Assignment and Acceptance
Agreement(s), without premium or discount.
11.2 ASSIGNMENTS; PARTICIPATIONS.
(a) Any Lender may, with the written consent of the
Administrative Agent (which consent shall not be unreasonably withheld) and with
the written consent of the Parent (which consent shall not be unreasonably
withheld and shall not be required during the continuance of an Event of
Default), assign and delegate to one or more Eligible Assignees (provided that
no consent of the Administrative Agent or the Parent shall be required in
connection with any assignment and delegation by a Lender to an Affiliate of
such Lender) (each an "ASSIGNEE") all, or any ratable part of all, of the Loans,
the Participations and the Commitments and the other rights and obligations of
such Lender hereunder; PROVIDED that the same percentage of all Loans,
Participations and Commitments must be assigned such that no Lender or Assignee
will have a disproportionate interest in any of the Credit Facilities, in a
minimum amount of $10,000,000 or the Foreign Currency Equivalent thereof
(provided that, unless an assignor Lender has assigned and delegated all of its
Loans and Commitments, no such assignment and/or delegation shall be permitted
unless, after giving effect thereto, such assignor Lender retains a Commitment
in a minimum amount of $10,000,000 or the Foreign Currency Equivalent thereof);
PROVIDED, HOWEVER, that the Borrowers and the Administrative Agent may continue
to deal solely and directly with such Lender in connection with the interest so
assigned to an Assignee until (i) written notice of such assignment, together
with payment instructions, addresses and related information with respect to the
Assignee, shall have been given to the Borrowers and the Administrative Agent by
such Lender and the Assignee; (ii) such Lender and its Assignee shall have
delivered to the Borrowers and the Administrative Agent an Assignment and
Acceptance in the form of EXHIBIT F ("ASSIGNMENT AND ACCEPTANCE") together with
any
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note or notes subject to such assignment and (iii) the assignor Lender or
Assignee has paid to the Administrative Agent a processing fee in the amount of
$3,500. Notwithstanding the foregoing, the maximum number of Lenders shall not
exceed five (5) unless that number is exceeded during the continuance of an
Event of Default. The Borrowers agree to promptly execute and deliver new
promissory notes and replacement promissory notes as reasonably requested by the
Administrative Agent to evidence assignments of the Loans and Commitments in
accordance herewith.
(b) From and after the date that the Administrative Agent
notifies the assignor Lender that it has received an executed Assignment and
Acceptance and payment of the above-referenced processing fee, (i) the Assignee
thereunder shall be a party hereto and, to the extent that rights and
obligations, including, but not limited to, the obligation to participate in
Letters of Credit and Credit Support have been assigned to it pursuant to such
Assignment and Acceptance, shall have the rights and obligations of a Lender
under the Loan Documents, and (ii) the assignor Lender shall, to the extent that
rights and obligations hereunder and under the other Loan Documents have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its rights
and be released from its obligations under this Agreement (and in the case of an
Assignment and Acceptance covering all or the remaining portion of an assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto).
(c) By executing and delivering an Assignment and Acceptance,
the assigning Lender thereunder and the Assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Acceptance, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other Loan Document furnished
pursuant hereto or the attachment, perfection, or priority of any Lien granted
by the Borrowers to the Administrative Agent or any Lender in the Collateral;
(ii) such assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrowers or the
performance or observance by the Borrowers of any of their obligations under
this Agreement or any other Loan Document furnished pursuant hereto; (iii) such
Assignee confirms that it has received a copy of this Agreement, together with
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into such Assignment and Acceptance;
(iv) such Assignee will, independently and without reliance upon the
Administrative Agent, such 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 Administrative
Agent to take such action as agent on its behalf and to exercise such powers
under this Agreement as are delegated to the Administrative Agent by the terms
hereof, together with such powers, including the discretionary rights and
incidental power, 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.
(d) Immediately upon satisfaction of the requirements of
SECTION 11.2(a), this Agreement shall be deemed to be amended to the extent, but
only to the extent, necessary to
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reflect the addition of the Assignee and the resulting adjustment of the
Commitments arising therefrom. The Commitment allocated to each Assignee shall
reduce such Commitments of the assigning Lender PRO TANTO.
(e) Any Lender may at any time sell to one or more commercial
banks, financial institutions, or other Persons not Affiliates of the Borrowers
(a "Participant") participating interests in any Loans, the Commitment of that
Lender and the other interests of that Lender (the "originating Lender")
hereunder and under the other Loan Documents; PROVIDED, HOWEVER, that (i) the
originating Lender's obligations under this Agreement shall remain unchanged,
(ii) the originating Lender shall remain solely responsible for the performance
of such obligations, (iii) the Borrowers and the Administrative Agent shall
continue to deal solely and directly with the originating Lender in connection
with the originating Lender's rights and obligations under this Agreement and
the other Loan Documents, and (iv) no Lender shall transfer or grant any
participating interest under which the Participant has rights to approve any
amendment to, or any consent or waiver with respect to, this Agreement or any
other Loan Document, and all amounts payable by the Borrowers hereunder shall be
determined as if such Lender had not sold such participation; except that, if
amounts outstanding under this Agreement are due and unpaid, or shall have
become due and payable upon the occurrence of an Event of Default, each
Participant shall be deemed to have the right of set-off in respect of its
participating interest in amounts owing under this Agreement to the same extent
and subject to the same limitation as if the amount of its participating
interest were owing directly to it as a Lender under this Agreement.
(f) Notwithstanding any other provision in this Agreement, any
Lender may at any time create a security interest in, or pledge, all or any
portion of its rights under and interest in this Agreement in favor of any
Federal Reserve Bank in accordance with Regulation A of the FRB or U.S. Treasury
Regulation 31 CFR Sec.203.14, and such Federal Reserve Bank may enforce such
pledge or security interest in any manner permitted under applicable law.
ARTICLE 12
THE COLLATERAL AND ADMINISTRATIVE AGENT
---------------------------------------
12.1 APPOINTMENT AND AUTHORIZATION. Each Lender hereby designates and
appoints Bank as its Administrative Agent under this Agreement and the other
Loan Documents and each Lender hereby irrevocably authorizes the Administrative
Agent to take such action on its behalf under the provisions of this Agreement
and each other Loan Document and to exercise such powers and perform such duties
as are expressly delegated to it by the terms of this Agreement or any other
Loan Document, together with such powers as are reasonably incidental thereto.
The Administrative Agent agrees to act as such on the express conditions
contained in this ARTICLE 12. The provisions of this ARTICLE 12 are solely for
the benefit of the Administrative Agent and the Lenders and the Borrowers shall
have no rights as a third party beneficiary of any of the provisions contained
herein. Notwithstanding any provision to the contrary contained elsewhere in
this Agreement or in any other Loan Document, the Administrative Agent shall not
have any duties or responsibilities, except those expressly set forth herein,
nor shall the Administrative Agent have or be deemed to have any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties,
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obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against the Administrative Agent. Without limiting
the generality of the foregoing sentence, the use of the term "agent" in this
Agreement with reference to the Administrative Agent is not intended to connote
any fiduciary or other implied (or express) obligations arising under agency
doctrine of any applicable law. Instead, such term is used merely as a matter of
market custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties. Except as expressly
otherwise provided in this Agreement, the Administrative Agent shall have and
may use its sole discretion with respect to exercising or refraining from
exercising any discretionary rights or taking or refraining from taking any
actions which the Administrative Agent is expressly entitled to take or assert
under this Agreement and the other Loan Documents, including (a) the
determination of the applicability of ineligibility criteria with respect to the
calculation of the Borrowing Base, (b) the making of Administrative Agent
Advances pursuant to SECTION 1.2(L), and (c) the exercise of remedies pursuant
to SECTION 9.2, and any action so taken or not taken shall be deemed consented
to by the Lenders.
12.2 DELEGATION OF DUTIES. The Administrative Agent may execute any of
its duties under this Agreement or any other Loan Document by or through
Affiliates, agents, employees or attorneys-in-fact and shall be entitled to
advice of counsel concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence or misconduct
of any agent or attorney-in-fact that it selects as long as such selection was
made without gross negligence or willful misconduct.
12.3 LIABILITY OF ADMINISTRATIVE AGENT. Neither the Agent nor any of
the Administrative Agent-Related Persons shall (i) be liable for any action
taken or omitted to be taken by any of them under or in connection with this
Agreement or any other Loan Document or the transactions contemplated hereby
(except for its own gross negligence or willful misconduct), or (ii) be
responsible in any manner to any of the Lenders for any recital, statement,
representation or warranty made by any Borrower or any Subsidiary or Affiliate
of the Borrowers, or any officer thereof, contained in this Agreement or in any
other Loan Document, or in any certificate, report, statement or other document
referred to or provided for in, or received by the Administrative Agent under or
in connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of the Borrowers or any other party
to any Loan Document to perform its obligations hereunder or thereunder. No
Administrative Agent-Related Person shall be under any obligation to any Lender
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of the Borrowers or any
of the Borrowers' Subsidiaries or Affiliates.
12.4 RELIANCE BY ADMINISTRATIVE AGENT. The Administrative Agent shall
be entitled to rely, and shall be fully protected in relying, upon any writing,
resolution, notice, consent, certificate, affidavit, letter, telegram,
facsimile, telex or telephone message, statement 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 counsel to the Borrowers), independent accountants and
other experts selected by the Administrative Agent. The Administrative Agent
shall be fully justified in failing or refusing to
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take any action under this Agreement or any other Loan Document unless it shall
first receive such advice or concurrence of the Required Lenders as it deems
appropriate and, if it so requests, 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
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of the Required Lenders (or all Lenders if
so required by SECTION 11.1) and such request and any action taken or failure to
act pursuant thereto shall be binding upon all of the Lenders.
12.5 NOTICE OF DEFAULT. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default,
unless the Administrative Agent shall have received written notice from a Lender
or the Borrowers referring to this Agreement, describing such Default or Event
of Default and stating that such notice is a "notice of default." The
Administrative Agent will notify the Lenders of its receipt of any such notice.
The Administrative Agent shall take such action with respect to such Default or
Event of Default as may be requested by the Required Lenders in accordance with
SECTION 9.2; PROVIDED, HOWEVER, that unless and until the Administrative Agent
has received any such request, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable.
12.6 CREDIT DECISION. Each Lender acknowledges that none of the
Administrative Agent-Related Persons has made any representation or warranty to
it, and that no act by the Administrative Agent hereinafter taken, including any
review of the affairs of the Borrowers and their Affiliates, shall be deemed to
constitute any representation or warranty by any Administrative Agent-Related
Person to any Lender. Each Lender represents to the Administrative Agent that it
has, independently and without reliance upon any Administrative Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
operations, property, financial and other condition and creditworthiness of the
Borrowers and their Affiliates, and all applicable bank regulatory laws relating
to the transactions contemplated hereby, and made its own decision to enter into
this Agreement and to extend credit to the Borrowers. Each Lender also
represents that it will, independently and without reliance upon any
Administrative Agent-Related Person 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 the other Loan Documents, and to make such investigations as it
deems necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of the Borrowers.
Except for notices, reports and other documents expressly herein required to be
furnished to the Lenders by the Administrative Agent, the Administrative Agent
shall not have any duty or responsibility to provide any Lender with any credit
or other information concerning the business, prospects, operations, property,
financial and other condition or creditworthiness of the Borrowers which may
come into the possession of any of the Administrative Agent-Related Persons.
12.7 INDEMNIFICATION. Whether or not the transactions contemplated
hereby are consummated, the Lenders shall indemnify upon demand the
Administrative Agent-Related Persons (to the extent not reimbursed by or on
behalf of the Borrowers and without limiting the
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obligation of the Borrowers to do so), pro rata, from and against any and all
Indemnified Liabilities as such term is defined in SECTION 13.11; PROVIDED,
HOWEVER, that no Lender shall be liable for the payment to the Administrative
Agent-Related Persons of any portion of such Indemnified Liabilities resulting
solely from such Person's gross negligence or willful misconduct. Without
limitation of the foregoing, each Lender shall reimburse the Administrative
Agent upon demand for its ratable share of any costs or out-of-pocket expenses
(including, without limitation, Enforcement Costs) incurred by the
Administrative Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, any other Loan Document, or
any document contemplated by or referred to herein, to the extent that the
Administrative Agent is not reimbursed for such expenses by or on behalf of the
Borrowers. The undertaking in this Section shall survive the payment of all
Obligations hereunder and the resignation or replacement of the Administrative
Agent.
12.8 ADMINISTRATIVE AGENT IN INDIVIDUAL CAPACITY. The Bank and its
Affiliates may make loans to, issue letters of credit for the account of, accept
deposits from, acquire equity interests in and generally engage in any kind of
banking, trust, financial advisory, underwriting or other business with the
Borrowers and their Subsidiaries and Affiliates as though the Bank were not the
Administrative Agent hereunder and without notice to or consent of the Lenders.
The Bank or its Affiliates may receive information regarding the Borrowers,
their Affiliates and Account Debtors (including information that may be subject
to confidentiality obligations in favor of the Borrowers or such Subsidiary) and
acknowledge that the Administrative Agent and the Bank shall be under no
obligation to provide such information to them. With respect to its Loans, the
Bank shall have the same rights and powers under this Agreement as any other
Lender and may exercise the same as though it were not the Administrative Agent,
and the terms "Lender" and "Lenders" include the Bank in its individual
capacity.
12.9 SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may
resign as Administrative Agent upon at least 30 days' prior notice to the
Lenders and the Borrowers, such resignation to be effective upon the acceptance
of a successor agent to its appointment as Administrative Agent. In the event
the Bank sells all of its Commitment and Revolving Loans as part of a sale,
transfer or other disposition by the Bank of substantially all of its loan
portfolio, the Bank shall resign as Administrative Agent and such purchaser or
transferee shall become the successor Administrative Agent hereunder. Subject to
the foregoing, if the Administrative Agent resigns under this Agreement, the
Required Lenders shall appoint from among the Lenders a successor agent for the
Lenders. If no successor agent is appointed prior to the effective date of the
resignation of the Administrative Agent, the Administrative Agent may appoint,
after consulting with the Lenders and the Borrowers, a successor agent from
among the Lenders. Upon the acceptance of its appointment as successor agent
hereunder, such successor agent shall succeed to all the rights, powers and
duties of the retiring Administrative Agent and the term "Administrative Agent"
shall mean such successor agent and the retiring Administrative Agent's
appointment, powers and duties as Administrative Agent shall be terminated.
After any retiring Administrative Agent's resignation hereunder as
Administrative Agent, the provisions of this ARTICLE 12 shall continue to inure
to its benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement.
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12.10 WITHHOLDING TAX.
(a) If any Lender is a "foreign corporation, partnership or
trust" within the meaning of the Code and such Lender claims exemption from, or
a reduction of, U.S. withholding tax under Sections 1441 or 1442 of the Code,
such Lender agrees with and in favor of the Administrative Agent, to deliver to
the Administrative Agent:
(i) if such Lender claims an exemption from, or a
reduction of, withholding tax under a United States of America tax treaty,
properly completed IRS Forms W-8BEN and W-8ECI before the payment of any
interest in the first calendar year and before the payment of any interest in
each third succeeding calendar year during which interest may be paid under this
Agreement;
(ii) if such Lender claims that interest paid under
this Agreement is exempt from United States of America withholding tax because
it is effectively connected with a United States of America trade or business of
such Lender, two properly completed and executed copies of IRS Form W-8ECI
before the payment of any interest is due in the first taxable year of such
Lender and in each succeeding taxable year of such Lender during which interest
may be paid under this Agreement, and IRS Form W-9; and
(iii) such other form or forms as may be required
under the Code or other laws of the United States of America as a condition to
exemption from, or reduction of, United States of America withholding tax.
Such Lender agrees to promptly notify the Administrative Agent of any change in
circumstances which would modify or render invalid any claimed exemption or
reduction.
(b) If any Lender claims exemption from, or reduction of,
withholding tax under a United States of America tax treaty by providing IRS
Form FW-8BEN and such Lender sells, assigns, grants a participation in, or
otherwise transfers all or part of the Obligations owing to such Lender, such
Lender agrees to notify the Administrative Agent of the percentage amount in
which it is no longer the beneficial owner of Obligations of the Borrowers to
such Lender. To the extent of such percentage amount, the Administrative Agent
will treat such Lender's IRS Form W-8BEN as no longer valid.
(c) If any Lender claiming exemption from United States of
America withholding tax by filing IRS Form W-8ECI with the Administrative Agent
sells, assigns, grants a participation in, or otherwise transfers all or part of
the Obligations owing to such Lender, such Lender agrees to undertake sole
responsibility for complying with the withholding tax requirements imposed by
Sections 1441 and 1442 of the Code.
(d) If any Lender is entitled to a reduction in the applicable
withholding tax, the Administrative Agent may withhold from any interest payment
to such Lender an amount equivalent to the applicable withholding tax after
taking into account such reduction. If the forms or other documentation required
by SUBSECTION (A) of this Section are not delivered to the Administrative Agent,
then the Administrative Agent may withhold from any interest payment to such
Lender not providing such forms or other documentation an amount equivalent to
the applicable withholding tax.
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(e) If the IRS or any other Governmental Authority of the
United States of America or other jurisdiction asserts a claim that the
Administrative Agent did not properly withhold tax from amounts paid to or for
the account of any Lender (because the appropriate form was not delivered, was
not properly executed, or because such Lender failed to notify the
Administrative Agent of a change in circumstances which rendered the exemption
from, or reduction of, withholding tax ineffective, or for any other reason),
such Lender shall indemnify the Administrative Agent fully for all amounts paid,
directly or indirectly, by the Administrative Agent as tax or otherwise,
including penalties and interest, and including any taxes imposed by any
jurisdiction on the amounts payable to the Administrative Agent under this
Section, together with all costs and expenses (including, without limitation,
Enforcement Costs). The obligation of the Lenders under this subsection shall
survive the payment of all Obligations and the resignation or replacement of the
Administrative Agent.
12.11 COLLATERAL MATTERS.
(a) The Lenders hereby irrevocably authorize the
Administrative Agent, at its option and in its sole discretion, to release any
Administrative Agent's Liens upon any Collateral (i) upon the termination of the
Commitments and payment and satisfaction in full by Borrowers of all Loans and
reimbursement obligations in respect of Letters of Credit and Credit Support,
and the termination of all outstanding Letters of Credit (whether or not any of
such obligations are due) and all other Obligations; (ii) constituting property
being sold or disposed of if the Borrowers certify to the Administrative Agent
that the sale or disposition is made in compliance with SECTION 7.9 (and the
Administrative Agent may rely conclusively on any such certificate, without
further inquiry); (iii) constituting property in which the Borrowers owned no
interest at the time the Lien was granted or at any time thereafter; or (iv)
constituting property leased to the Borrowers under a lease which has expired or
been terminated in a transaction permitted under this Agreement. Except as
provided above, the Administrative Agent will not release any of the
Administrative Agent's Liens without the prior written authorization of the
Lenders; PROVIDED that the Administrative Agent may, in its discretion, release
the Administrative Agent's Liens on Collateral valued in the aggregate not in
excess of $500,000, or the Foreign Currency Equivalent thereof, during each
Fiscal Year without the prior written authorization of the Lenders and the
Administrative Agent may release the Administrative Agent's Liens on Collateral
valued in the aggregate not in excess of $1,000,000, or the Foreign Currency
Equivalent thereof, during each Fiscal Year with the prior written authorization
of Required Lenders. Upon request by the Administrative Agent or the Borrowers
at any time, the Lenders will confirm in writing the Administrative Agent's
authority to release any Administrative Agent's Liens upon particular types or
items of Collateral pursuant to this SECTION 12.11.
(b) Upon receipt by the Administrative Agent of any
authorization required pursuant to SECTION 12.11(A) from the Lenders of the
Administrative Agent's authority to release Administrative Agent's Liens upon
particular types or items of Collateral, and upon at least five (5) Business
Days prior written request by the Borrowers, the Administrative Agent shall (and
is hereby irrevocably authorized by the Lenders to) execute such documents as
may be necessary to evidence the release of the Administrative Agent's Liens
upon such Collateral; PROVIDED, HOWEVER, that (i) the Administrative Agent shall
not be required to execute any such document on terms which, in the
Administrative Agent's opinion, would expose the Administrative Agent to
liability or create any obligation or entail any consequence other than the
release of such Liens
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without recourse or warranty, and (ii) such release shall not in any manner
discharge, affect or impair the Obligations or any Liens (other than those
expressly being released) upon (or obligations of the Borrowers in respect of)
all interests retained by the Borrowers, including the proceeds of any sale, all
of which shall continue to constitute part of the Collateral.
(c) The Administrative Agent shall have no obligation
whatsoever to any of the Lenders to assure that the Collateral exists or is
owned by the Borrowers or is cared for, protected or insured or has been
encumbered, or that the Administrative Agent's Liens have been properly or
sufficiently or lawfully created, perfected, protected or enforced or are
entitled to any particular priority, or to exercise at all or in any particular
manner or under any duty of care, disclosure or fidelity, or to continue
exercising, any of the rights, authorities and powers granted or available to
the Administrative Agent pursuant to any of the Loan Documents, it being
understood and agreed that in respect of the Collateral, or any act, omission or
event related thereto, the Administrative Agent may act in any manner it may
deem appropriate, in its sole discretion given the Administrative Agent's own
interest in the Collateral in its capacity as one of the Lenders and that the
Administrative Agent shall have no other duty or liability whatsoever to any
Lender as to any of the foregoing.
12.12 RESTRICTIONS ON ACTIONS BY LENDERS; SHARING OF PAYMENTS.
(a) Each of the Lenders agrees that it shall not, without the
express consent of all Lenders, and that it shall, to the extent it is lawfully
entitled to do so, upon the request of all Lenders, set off against the
Obligations, any amounts owing by such Lender to the Borrowers or any accounts
of the Borrowers now or hereafter maintained with such Lender. Each of the
Lenders further agrees that it shall not, unless specifically requested to do so
by the Administrative Agent, take or cause to be taken any action to enforce its
rights under this Agreement or against the Borrowers, including the commencement
of any legal or equitable proceedings, to foreclose any Lien on, or otherwise
enforce any security interest in, any of the Collateral.
(b) If at any time or times any Lender shall receive (i) by
payment, foreclosure, setoff or otherwise, any proceeds of Collateral or any
payments with respect to the Obligations of the Borrowers to such Lender arising
under, or relating to, this Agreement or the other Loan Documents, except for
any such proceeds or payments received by such Lender from the Administrative
Agent pursuant to the terms of this Agreement, or (ii) payments from the
Administrative Agent in excess of such Lender's ratable portion of all such
distributions by the Administrative Agent, such Lender shall promptly (1) turn
the same over to the Administrative Agent, in kind, and with such endorsements
as may be required to negotiate the same to the Administrative Agent, or in same
day funds, as applicable, for the account of all of the Lenders and for
application to the Obligations in accordance with the applicable provisions of
this Agreement, or (2) purchase, without recourse or warranty, an undivided
interest and participation in the Obligations owed to the other Lenders so that
such excess payment received shall be applied ratably as among the Lenders in
accordance with their Pro Rata Shares; PROVIDED, HOWEVER, that if all or part of
such excess payment received by the purchasing party is thereafter recovered
from it, those purchases of participations shall be rescinded in whole or in
part, as applicable, and the applicable portion of the purchase price paid
therefor shall be returned to
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such purchasing party, but without interest except to the extent that such
purchasing party is required to pay interest in connection with the recovery of
the excess payment.
12.13 AGENCY FOR PERFECTION. Each Lender hereby appoints each other
Lender as agent for the purpose of perfecting the Lenders' security interest in
assets which, in accordance with Article 9 of the UCC can be perfected only by
possession. Should any Lender (other than the Administrative Agent) obtain
possession of any such Collateral, such Lender shall notify the Administrative
Agent thereof, and, promptly upon the Administrative Agent's request therefor
shall deliver such Collateral to the Administrative Agent or in accordance with
the Administrative Agent's instructions.
12.14 PAYMENTS BY ADMINISTRATIVE AGENT TO LENDERS. All payments to be
made by the Administrative Agent to the Lenders shall be made by bank wire
transfer or internal transfer of immediately available funds to each Lender
pursuant to wire transfer instructions delivered in writing to the
Administrative Agent on or prior to the Closing Date (or if such Lender is an
Assignee, on the applicable Assignment and Acceptance), or pursuant to such
other wire transfer instructions as each party may designate for itself by
written notice to the Administrative Agent. Concurrently with each such payment,
the Administrative Agent shall identify whether such payment (or any portion
thereof) represents principal, premium or interest on the Revolving Loans, Term
Loans or otherwise. Unless the Administrative Agent receives notice from the
Borrowers prior to the date on which any payment is due to the Lenders that the
Borrowers will not make such payment in full as and when required, the
Administrative Agent may assume that the Borrowers have made such payment in
full to the Administrative Agent on such date in immediately available funds and
the Administrative Agent may (but shall not be so required), in reliance upon
such assumption, distribute to each Lender on such due date an amount equal to
the amount then due such Lender. If and to the extent the Borrowers have not
made such payment in full to the Administrative Agent, each Lender shall repay
to the Administrative Agent on demand such amount distributed to such Lender,
together with interest thereon at the Federal Funds Rate for each day from the
date such amount is distributed to such Lender until the date repaid.
12.15 SETTLEMENT.
(a) (i) The Lenders agree that each Lender's funded
portion of the Revolving Loans is intended by the Lenders to be equal at all
times to such Lender's Pro Rata Share of the outstanding Revolving Loans, as the
case may be. Notwithstanding such agreement, the Administrative Agent, the Bank,
and the Lenders agree (which agreement shall not be for the benefit of or
enforceable by the Borrowers) that in order to facilitate the administration of
this Agreement and the other Loan Documents, settlement among them as to the
Revolving Loans, Non-Ratable Loans and the Administrative Agent Advances shall
take place on a periodic basis in accordance with the provisions of this SECTION
12.15(a).
(ii) The Administrative Agent shall request
settlement ("Settlement") with the Lenders on at least a weekly basis, or on a
more frequent basis if so determined by the Administrative Agent, (A) for
itself, with respect to each Administrative Agent Advance, and (B) with respect
to collections received, in each case, by notifying the Lenders of such
requested Settlement by telecopy, telephone or other similar form of
transmission, of such requested
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Settlement, no later than 12:00 noon (Chicago, Illinois time) on the date of
such requested Settlement (the "Settlement Date"). Each Lender (other than the
Administrative Agent in the case of Administrative Agent Advances) shall make
the amount of such Lender's Pro Rata Share, as the case may be, of the
outstanding principal amount of the Non-Ratable Loans and Administrative Agent
Advances with respect to which Settlement is requested available to the
Administrative Agent, to such account of the Administrative Agent as the
Administrative Agent may designate, not later than 2:00 p.m. (Chicago, Illinois
Time), on the Settlement Date applicable thereto, which may occur before or
after the occurrence or during the continuation of a Default or an Event of
Default and whether or not the applicable conditions precedent set forth in
ARTICLE 8 (Conditions of Lending) have then been satisfied. Such amounts made
available to the Administrative Agent shall be applied against the amounts of
the applicable Non-Ratable Loan or Administrative Agent Advance and, together
with the portion of such Non-Ratable Loan or Administrative Agent Advance
representing the Bank's Pro Rata Share thereof, shall constitute Revolving Loans
of such Lenders. If any such amount is not made available to the Administrative
Agent by any Lender on the Settlement Date applicable thereto, the
Administrative Agent shall be entitled to recover such amount on demand from
such Lender together with interest thereon at the Federal Funds Rate for the
first three (3) days from and thereafter at the Interest Rate then applicable to
the Revolving Loans (A) on behalf of the Bank, with respect to each outstanding
Non-Ratable Loan, and (B) for itself, with respect to each Administrative Agent
Advance.
(iii) Notwithstanding the foregoing, not more than
one (1) Business Day after demand is made by the Administrative Agent (whether
before or after the occurrence of a Default or an Event of Default and
regardless of whether the Administrative Agent has requested a Settlement with
respect to a Non-Ratable Loan or Administrative Agent Advance), each other
Lender shall irrevocably and unconditionally purchase and receive from Bank, the
Administrative Agent, as applicable, without recourse or warranty, an undivided
interest and participation in such Non-Ratable Loan or Administrative Agent
Advance equal to such Lender's Pro Rata Share, as the case may be, of such
Non-Ratable Loan or Administrative Agent Advance. If Settlement has not
previously occurred with respect to such Non-Ratable Loans or Administrative
Agent Advances, upon demand by Bank, the Administrative Agent, as applicable,
each other Lender shall pay to Bank, the Administrative Agent, as applicable, in
Dollars in an amount equal to the Dollar Equivalent thereof, as the purchase
price of such participation an amount equal to one-hundred percent (100%) of
such Lender's of such Non-Ratable Loans or Administrative Agent Advances. If
such amount is not in fact made available to the Administrative Agent by any
Lender, the Administrative Agent shall be entitled to recover such amount on
demand from such Lender, together with interest thereon at the Federal Funds
Rate for the first three (3) days from and after such demand and thereafter at
the then applicable Interest Rate then applicable to Base Rate Revolving Loans.
(iv) From and after the date, if any, on which any
Lender purchases an undivided interest and participation in any Non-Ratable Loan
or Administrative Agent Advance pursuant to subsection (ii) above, the
Administrative Agent shall promptly distribute to such Lender at such address as
such Lender may request in writing, such Lender's Pro Rata Share of all payments
of principal and interest and all proceeds of Collateral (subject to the
limitations of Section 12.15 (Settlement)) received by the Administrative Agent
in respect of such Non-Ratable Loan or Administrative Agent Advance.
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(v) Between Settlement Dates, the Administrative
Agent, to the extent no Administrative Agent Advances or Non-Ratable Loans are
outstanding, may pay over to the Bank any payments received by the
Administrative Agent, which in accordance with the terms of this Agreement would
be applied to the reduction of the Revolving Loans, for application to the
Bank's Pro Rata Share of Revolving Loans. If, as of any Settlement Date,
collections received since the then immediately preceding Settlement Date have
been applied to the Bank's Pro Rata Share of Revolving Loans (other than to
Non-Ratable Loans or Administrative Agent Advances in which such Lender has not
yet funded its purchase of a participation pursuant to SECTION 12.15(A)(III)
above), as provided for in the previous sentence, the Bank shall pay to the
Administrative Agent for the accounts of the Lenders to be applied to the
outstanding Revolving Loans of such Lenders an amount such that each Lender
shall, upon receipt of such amount, have, as of such Settlement Date, its Pro
Rata Share of the Revolving Loans. During the period between Settlement Dates,
the Administrative Agent with respect to Administrative Agent Advances, and each
Lender with respect to the Revolving Loans (other than Non-Ratable Loans and
Administrative Agent Advances) shall be entitled to interest at the applicable
rate or rates payable under this Agreement on the actual daily amount of funds
employed by the Bank, the Administrative Agent, the other Lenders.
(b) NOTATION. The Administrative Agent shall record on its
books the principal amount of the Revolving Loans owing to each Lender,
including the Non-Ratable Loans owing to the Bank, and the Administrative Agent
Advances owing to the Administrative Agent, from time to time. In addition, each
Lender is authorized, at such Lender's option, to note the date and amount of
each payment or prepayment of principal of such Lender's Revolving Loans in its
books and records, including computer records, such books and records
constituting presumptive evidence, absent manifest error, of the accuracy of the
information contained therein.
(c) LENDERS' FAILURE TO PERFORM. All Revolving Loans (other
than Non-Ratable Loans and Administrative Agent Advances) shall be made by the
Lenders simultaneously and in accordance with their Pro Rata Shares. It is
understood that (i) no Lender shall be responsible for any failure by any other
Lender to perform its obligation to make any Revolving Loans hereunder, nor
shall any Commitment of any Lender be increased or decreased as a result of any
failure by any other Lender to perform its obligation to make any Revolving
Loans hereunder, (ii) no failure by any Lender to perform its obligation to make
any Revolving Loans hereunder shall excuse any other Lender from its obligation
to make any Revolving Loans hereunder, and (iii) the obligations of each Lender
hereunder shall be several, not joint and several.
(d) DEFAULTING LENDERS. Unless the Administrative Agent
receives notice from a Lender on or prior to the Closing Date or, with respect
to any Borrowing after the Closing Date, at least one Business Day prior to the
date of such Borrowing, that such Lender will not make available as and when
required hereunder to the Administrative Agent that Lender's Pro Rata Share of a
Borrowing, the Administrative Agent may assume that each Lender has made such
amount available to the Administrative Agent in immediately available funds
on the Funding Date. Furthermore, the Administrative Agent may, in reliance upon
such assumption, make available to the Borrowers on such date a corresponding
amount. If any Lender has not transferred its full Pro Rata Share to the
Administrative Agent in immediately available funds
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and the Administrative Agent has transferred a corresponding amount to the
Borrowers on the Business Day following such Funding Date, that Lender shall
make such amount available to the Administrative Agent, together with interest
at the Federal Funds Rate for that day. A notice by the Administrative Agent
submitted to any Lender with respect to amounts owing shall be conclusive,
absent manifest error. If each Lender's full Pro Rata Share is transferred to
the Administrative Agent as required, the amount transferred to the
Administrative Agent shall constitute that Lender's Revolving Loan for all
purposes of this Agreement. If that amount is not transferred to the
Administrative Agent on the Business Day following the Funding Date, the
Administrative Agent will notify the Borrowers of such failure to fund and, upon
demand by the Administrative Agent, the Borrowers shall pay such amount to the
Administrative Agent for the Administrative Agent's account, together with
interest thereon for each day elapsed since the date of such Borrowing, at a
rate per annum equal to the Interest Rate applicable at the time to the
Revolving Loans comprising that particular Borrowing. The failure of any
Lender to make any Revolving Loan on any Funding Date (any such Lender, prior to
the cure of such failure, being hereinafter referred to as a "Defaulting
Lender") shall not relieve any other Lender of its obligation hereunder to make
a Revolving Loan on that Funding Date. No Lender shall be responsible for any
other Lender's failure to advance such other Lenders' Pro Rata Share of any
Borrowing.
(e) RETENTION OF DEFAULTING LENDER'S PAYMENTS. The
Administrative Agent shall not be obligated to transfer to a Defaulting Lender
any payments made by Borrowers to the Administrative Agent for the Defaulting
Lender's benefit; nor shall a Defaulting Lender be entitled to the sharing of
any payments hereunder. Amounts payable to a Defaulting Lender shall instead be
paid to or retained by the Administrative Agent. In its discretion, the
Administrative Agent may lend to the Borrowers the amount of all such payments
received or retained by it for the account of such Defaulting Lender. Any
amounts so loaned to the Borrowers shall bear interest at the rate applicable to
Base Rate Revolving Loans and for all other purposes of this Agreement shall be
treated as if they were Revolving Loans; PROVIDED, HOWEVER, that for purposes of
voting or consenting to matters with respect to the Loan Documents and
determining Pro Rata Shares, such Defaulting Lender shall be deemed not to be a
"Lender". Until a Defaulting Lender cures its failure to fund its Pro Rata Share
of any Borrowing, (A) such Defaulting Lender shall not be entitled to any
portion of the Unused Line Fee and (B) the Unused Line Fee shall accrue in favor
of the Lenders which have funded their respective Pro Rata Shares of such
requested Borrowing and shall be allocated among such performing Lenders ratably
based upon their relative Commitments. This Section shall remain effective with
respect to such Lender until such time as the Defaulting Lender shall no longer
be in default of any of its obligations under this Agreement. The terms of this
Section shall not be construed to increase or otherwise affect the Commitment of
any Lender, or relieve or excuse the performance by the Borrowers of their
duties and obligations hereunder.
(f) REMOVAL OF DEFAULTING LENDER. At the Borrowers' request,
the Administrative Agent or an Eligible Assignee reasonably acceptable to the
Administrative Agent and the Borrowers shall have the right (but not the
obligation) to purchase from any Defaulting Lender, and each Defaulting Lender
shall, upon such request, sell and assign to the Administrative Agent or such
Eligible Assignee, all of the Defaulting Lender's outstanding Commitments
hereunder. Such sale shall be consummated promptly after the Administrative
Agent has arranged for a purchase by the Administrative Agent or an Eligible
Assignee pursuant
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to an Assignment and Acceptance, and at a price equal to the outstanding
principal balance of the Defaulting Lender's Loans, plus accrued interest and
fees, without premium or discount.
12.16 LETTERS OF CREDIT; INTRA-LENDER ISSUES.
(a) NOTICE OF LETTER OF CREDIT BALANCE. On each Settlement
Date, the Administrative Agent shall notify each Lender of the issuance of all
Letters of Credit since the prior Settlement Date.
(b) PARTICIPATIONS IN LETTERS OF CREDIT.
(i) PURCHASE OF PARTICIPATIONS. Immediately upon
issuance of any Letter of Credit in accordance with SECTION 1.5(d), each Lender
shall be deemed to have irrevocably and unconditionally purchased and received,
without recourse or warranty, an undivided interest and participation equal to
such Lender's Pro Rata Share of the face amount of such Letter of Credit or the
Credit Support provided through the Administrative Agent to the Letter of Credit
Issuer, if not the Administrative Agent, in connection with the issuance of such
Letter of Credit (including all obligations of the Borrowers with respect
thereto, and any security therefor or guaranty pertaining thereto).
(ii) SHARING OF REIMBURSEMENT OBLIGATION PAYMENTS.
Whenever the Administrative Agent receives a payment from the Borrowers on
account of reimbursement obligations in respect of a Letter of Credit or Credit
Support as to which the Administrative Agent has previously received for the
account of the Letter of Credit Issuer thereof payment from a Lender, the
Administrative Agent shall promptly pay to such Lender such Lender's Pro Rata
Share of such payment from the Borrowers. Each such payment shall be made by the
Administrative Agent on the next Settlement Date.
(iii) DOCUMENTATION. Upon the request of any Lender,
the Administrative Agent shall furnish to such Lender copies of any Letter of
Credit, Credit Support for any Letter of Credit, reimbursement agreements
executed in connection therewith, applications for any Letter of Credit, and
such other documentation as may reasonably be requested by such Lender.
(iv) OBLIGATIONS IRREVOCABLE. The obligations of each
Lender to make payments to the Administrative Agent with respect to any Letter
of Credit or with respect to their participation therein or with respect to any
Credit Support for any Letter of Credit or with respect to the Revolving Loans
made as a result of a drawing under a Letter of Credit and the obligations of
the Borrowers for whose account the Letter of Credit or Credit Support was
issued to make payments to the Administrative Agent, for the account of the
Lenders, shall be irrevocable and shall not be subject to any qualification or
exception whatsoever, including any of the following circumstances:
(1) any lack of validity or enforceability
of this Agreement or any of the other Loan Documents;
(2) the existence of any claim, setoff,
defense or other right which the Borrowers may have at any time against a
beneficiary named in a Letter of Credit or
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any transferee of any Letter of Credit (or any Person for whom any such
transferee may be acting), any Lender, the Administrative Agent, the issuer of
such Letter of Credit, or any other Person, whether in connection with this
Agreement, any Letter of Credit, the transactions contemplated herein or any
unrelated transactions (including any underlying transactions between the
Borrowers or any other Person and the beneficiary named in any Letter of
Credit);
(3) any draft, certificate or any other
document presented under the Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(4) the surrender or impairment of any
security for the performance or observance of any of the terms of any of the
Loan Documents;
(5) the occurrence of any Default or Event
of Default; or
(6) the failure of the Borrowers to satisfy
the applicable conditions precedent set forth in ARTICLE 8.
(c) RECOVERY OR AVOIDANCE OF PAYMENTS; REFUND OF PAYMENTS IN
ERROR. In the event any payment by or on behalf of the Borrowers received by the
Administrative Agent with respect to any Letter of Credit or Credit Support
provided for any Letter of Credit and distributed by the Administrative Agent to
the Lenders on account of their respective participations therein is thereafter
set aside, avoided or recovered from the Administrative Agent in connection with
any receivership, liquidation or bankruptcy proceeding, the Lenders shall, upon
demand by the Administrative Agent, pay to the Administrative Agent their
respective Pro Rata Shares of such amount set aside, avoided or recovered,
together with interest at the rate required to be paid by the Administrative
Agent upon the amount required to be repaid by it. Unless the Administrative
Agent receives notice from the Borrowers prior to the date on which any payment
is due to the Lenders that the Borrowers will not make such payment in full as
and when required, the Administrative Agent may assume that the Borrowers have
made such payment in full to the Administrative Agent on such date in
immediately available funds and the Administrative Agent may (but shall not be
so required), in reliance upon such assumption, distribute to each Lender on
such due date an amount equal to the amount then due such Lender. If and to the
extent the Borrowers have not made such payment in full to the Administrative
Agent, each Lender shall repay to the Administrative Agent on demand such amount
distributed to such Lender, together with interest thereon at the Federal Funds
Rate for each day from the date such amount is distributed to such Lender until
the date repaid.
12.17 CONCERNING THE COLLATERAL AND THE RELATED LOAN DOCUMENTS. Each
Lender authorizes and directs the Administrative Agent to enter into the other
Loan Documents, for the ratable benefit and obligation of the Administrative
Agent and the Lenders. Each Lender agrees that any action taken by the
Administrative Agent, Majority Lenders or Required Lenders, as applicable, in
accordance with the terms of this Agreement or the other Loan Documents, and the
exercise by the Administrative Agent, the Majority Lenders, or the Required
Lenders, as applicable, of their respective powers set forth therein or herein,
together with such other powers that are reasonably incidental thereto, shall be
binding upon all of the Lenders. The Lenders acknowledge that the Revolving
Loans, Term Loans, Administrative Agent Advances, Non-
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Ratable Loans, Hedge Agreements, Bank Products and all interest, fees and
expenses hereunder constitute one debt, secured PARI PASSU by all of the
Collateral.
12.18 FIELD AUDIT AND EXAMINATION REPORTS; DISCLAIMER BY LENDERS. By
signing this Agreement, each Lender:
(a) is deemed to have requested that the Administrative Agent
furnish such Lender, promptly after it becomes available, a copy of each field
audit or examination report (each a "Report" and collectively, "Reports")
prepared by the Administrative Agent;
(b) expressly agrees and acknowledges that neither the Bank
nor the Administrative Agent (i) makes any representation or warranty as to the
accuracy of any Report, or (ii) shall be liable for any information contained in
any Report;
(c) expressly agrees and acknowledges that the Reports are not
comprehensive audits or examinations, that the Administrative Agent or the Bank
or other party performing any audit or examination will inspect only specific
information regarding the Borrowers and will rely significantly upon the
Borrowers' books and records, as well as on representations of the Borrowers'
personnel;
(d) agrees to keep all Reports confidential and strictly for
its internal use, and not to distribute except to its participants, or use any
Report in any other manner; and
(e) without limiting the generality of any other
indemnification provision contained in this Agreement, agrees: (i) to hold the
Administrative Agent and any such other Lender preparing a Report harmless from
any action the indemnifying Lender may take or conclusion the indemnifying
Lender may reach or draw from any Report in connection with any loans or other
credit accommodations that the indemnifying Lender has made or may make to the
Borrowers, or the indemnifying Lender's participation in, or the indemnifying
Lender's purchase of, a loan or loans of the Borrowers; and (ii) to pay and
protect, and indemnify, defend and hold the Administrative Agent and any such
other Lender preparing a Report harmless from and against, the claims, actions,
proceedings, damages, costs, expenses and other amounts (including, without
limitation, Enforcement Costs) incurred by the Administrative Agent and any such
other Lender preparing a Report as the direct or indirect result of any third
parties who might obtain all or part of any Report through the indemnifying
Lender.
12.19 RELATION AMONG LENDERS. The Lenders are not partners or
co-venturers, and no Lender shall be liable for the acts or omissions of, or
(except as otherwise set forth herein in case of the Administrative Agent)
authorized to act for, any other Lender.
12.20 OTHER ADMINISTRATIVE AGENTS. None of the Lenders identified on
the facing page or signature pages of this Agreement as a "syndication agent,"
"documentation agent," "co-agent" or "lead manager" shall have any right, power,
obligation, liability, responsibility or duty under this Agreement other than
those applicable to all Lenders as such. Without limiting the foregoing, none of
the Lenders so identified shall have or be deemed to have any fiduciary
relationship with any Lender. Each Lender acknowledges that it has not relied,
and will not rely, on any of the Lenders so identified in deciding to enter into
this Agreement or in taking or not taking action hereunder.
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12.21 RIGHTS OF ADMINISTRATIVE AGENT AS SECURITY TRUSTEE. In its
capacity as Security Trustee, the Administrative Agent shall:
(a) have the benefit of all of the provisions of this ARTICLE
12;
(b) have all the powers of an absolute owner of the security
constituted by the UK Security Documents; and
(c) have all the rights and powers granted to it and be
subject to all the obligations and duties owed by it under the UK Security
Documents.
ARTICLE 13
MISCELLANEOUS
-------------
13.1 NO WAIVERS; CUMULATIVE REMEDIES. No failure by the Administrative
Agent or any Lender to exercise any right, remedy, or option under this
Agreement or any present or future supplement thereto, or in any other agreement
between or among the Borrowers and the Administrative Agent and/or any Lender,
or delay by the Administrative Agent or any Lender in exercising the same, will
operate as a waiver thereof. No waiver by the Administrative Agent or any Lender
will be effective unless it is in writing, and then only to the extent
specifically stated. No waiver by the Administrative Agent or the Lenders on any
occasion shall affect or diminish the Administrative Agent's and each Lender's
rights thereafter to require strict performance by the Borrowers of any
provision of this Agreement. The Administrative Agent and the Lenders may
proceed directly to collect the Obligations without any prior recourse to the
Collateral. The Administrative Agent's and each Lender's rights under this
Agreement will be cumulative and not exclusive of any other right or remedy
which the Administrative Agent or any Lender may have.
13.2 SEVERABILITY. The illegality or unenforceability of any provision
of this Agreement or any Loan Document or any instrument or agreement required
hereunder shall not in any way affect or impair the legality or enforceability
of the remaining provisions of this Agreement or any instrument or agreement
required hereunder.
13.3 GOVERNING LAW; CHOICE OF FORUM; SERVICE OF PROCESS.
(a) THIS AGREEMENT SHALL BE INTERPRETED AND THE RIGHTS AND
LIABILITIES OF THE PARTIES HERETO DETERMINED IN ACCORDANCE WITH THE INTERNAL
LAWS (AS OPPOSED TO THE CONFLICT OF LAWS PROVISIONS PROVIDED THAT PERFECTION
ISSUES WITH RESPECT TO ARTICLE 9 OF THE UCC MAY GIVE EFFECT TO APPLICABLE CHOICE
OR CONFLICT OF LAW RULES SET FORTH IN ARTICLE 9 OF THE UCC) OF THE STATE OF
ILLINOIS; PROVIDED THAT THE ADMINISTRATIVE AGENT AND THE LENDERS SHALL RETAIN
ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE
OF ILLINOIS OR OF THE UNITED STATES OF AMERICA
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LOCATED IN XXXX COUNTY, ILLINOIS, AND BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, EACH OF THE BORROWERS, THE ADMINISTRATIVE AGENT AND THE LENDERS
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF THE BORROWERS, THE ADMINISTRATIVE AGENT
AND THE LENDERS IRREVOCABLY WAIVE ANY OBJECTION, INCLUDING ANY OBJECTION TO THE
LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY
NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO.
NOTWITHSTANDING THE FOREGOING: (1) THE ADMINISTRATIVE AGENT AND THE LENDERS
SHALL HAVE THE RIGHT TO BRING ANY ACTION OR PROCEEDING AGAINST THE BORROWERS OR
THEIR PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION THE ADMINISTRATIVE AGENT
OR THE LENDERS DEEM NECESSARY OR APPROPRIATE IN ORDER TO REALIZE ON THE
COLLATERAL OR OTHER SECURITY FOR THE OBLIGATIONS AND (2) EACH OF THE PARTIES
HERETO ACKNOWLEDGES THAT ANY APPEALS FROM THE COURTS DESCRIBED IN THE
IMMEDIATELY PRECEDING SENTENCE MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE
THOSE JURISDICTIONS.
(c) EACH BORROWER HEREBY WAIVES PERSONAL SERVICE OF ANY AND
ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY
REGISTERED MAIL (RETURN RECEIPT REQUESTED) DIRECTED TO THE BORROWERS AT THEIR
ADDRESS SET FORTH IN SECTION 13.8 AND SERVICE SO MADE SHALL BE DEEMED TO BE
COMPLETED FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN SO DEPOSITED IN THE U.S.
MAIL, POSTAGE PREPAID. NOTHING CONTAINED HEREIN SHALL AFFECT THE RIGHT OF AGENT
OR THE LENDERS TO SERVE LEGAL PROCESS BY ANY OTHER MANNER PERMITTED BY LAW.
13.4 WAIVER OF JURY TRIAL. SUBJECT TO THE PROVISIONS OF SECTION 13.3,
THE BORROWERS, THE LENDERS AND THE ADMINISTRATIVE AGENT EACH IRREVOCABLY WAIVE
THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED
UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS,
OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR
OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER
PARTY OR ANY ADMINISTRATIVE AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE,
WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE
BORROWERS, THE LENDERS AND THE ADMINISTRATIVE AGENT EACH AGREE THAT ANY SUCH
CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT
LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO
A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION,
COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE
THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR
ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY
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SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS.
13.5 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All of the Borrowers'
representations and warranties contained in this Agreement shall survive the
execution, delivery, and acceptance thereof by the parties, notwithstanding any
investigation by the Administrative Agent or the Lenders or their respective
agents.
13.6 OTHER SECURITY AND GUARANTIES. The Administrative Agent may,
without notice or demand and without affecting the Borrowers' obligations
hereunder, from time to time: (a) take from any Person and hold collateral
(other than the Collateral) for the payment of all or any part of the
Obligations and exchange, enforce or release such collateral or any part
thereof; and (b) accept and hold any endorsement or guaranty of payment of all
or any part of the Obligations and release or substitute any such endorser or
guarantor, or any Person who has given any Lien in any other collateral as
security for the payment of all or any part of the Obligations, or any other
Person in any way obligated to pay all or any part of the Obligations.
13.7 FEES AND EXPENSES. The Borrowers agree to pay to the
Administrative Agent, for its benefit, on demand, all costs and expenses that
Administrative Agent pays or incurs in connection with the negotiation,
preparation, syndication, consummation, administration, enforcement, and
termination of this Agreement or any of the other Loan Documents, including: (a)
Enforcement Costs; (b) costs and expenses (including attorneys' and paralegals'
fees and disbursements) for any amendment, supplement, waiver, consent, or
subsequent closing in connection with the Loan Documents and the transactions
contemplated thereby; (c) costs and expenses of lien and title searches and
title insurance; (d) taxes, fees and other charges for recording the Mortgages,
filing financing statements and continuations, and other actions to perfect,
protect, and continue the Administrative Agent's Liens (including costs and
expenses paid or incurred by the Administrative Agent in connection with the
consummation of Agreement); (e) sums paid or incurred to pay any amount or take
any action required of the Borrowers under the Loan Documents that the Borrowers
fail to pay or take; (f) subject to the limitations contained in SECTION 7.4(b),
costs of appraisals, inspections, and verifications of the Collateral, including
travel, lodging, and meals for inspections of the Collateral and the Borrowers'
operations by the Administrative Agent plus the Administrative Agent's then
customary charge for field examinations and audits and the preparation of
reports thereof (such charge is currently $600 per day (or portion thereof) for
each agent or employee of the Administrative Agent with respect to each field
examination or audit); (g) costs and expenses of forwarding loan proceeds,
collecting checks and other items of payment, and establishing and maintaining
Payment Accounts and lock boxes; (h) costs and expenses of preserving and
protecting the Collateral; and (i) costs and expenses (including Attorneys'
Costs) paid or incurred to obtain payment of the Obligations, enforce the
Administrative Agent's Liens, sell or otherwise realize upon the Collateral, and
otherwise enforce the provisions of the Loan Documents, or to defend any claims
made or threatened against the Administrative Agent or any Lender arising out of
the transactions contemplated hereby (including preparations for and
consultations concerning any such matters). The foregoing shall not be construed
to limit any other provisions of the Loan Documents regarding costs and expenses
to be paid by the Borrowers. All of the foregoing costs and expenses shall be
charged to the Borrowers' Loan Account as Revolving Loans as described in
SECTION 3.6.
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13.8 NOTICES. Except as otherwise provided herein, all notices, demands
and requests that any party is required or elects to give to any other shall be
in writing, or by a telecommunications device capable of creating a written
record, and any such notice shall become effective (a) upon personal delivery
thereof, including, but not limited to, delivery by overnight mail and courier
service, (b) four (4) days after it shall have been mailed by United States
mail, first class, certified or registered, with postage prepaid, or (c) in the
case of notice by such a telecommunications device, when properly transmitted,
in each case addressed to the party to be notified as follows:
If to the Administrative Agent or to the Bank:
Bank of America, N.A.
16th Floor
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Business Credit-Account Executive
for Unifrax
Telecopy No.: (000) 000-0000
with copies to:
Xxxxxxxxx X. Xxxxx, Xx., Esquire
Miles & Stockbridge P.C.
00 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
If to the Borrowers:
Unifrax Corporation
0000 Xxxxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxx Xxxx 00000-0000
Attention: Xxxx X. Xxxx
with copies to:
Xxxxxxx X. Xxxxxx, Xx., Esquire
Xxxxx, Day, Xxxxxx & Xxxxx
North Point
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
or to such other address as each party may designate for itself by like notice.
Failure or delay in delivering copies of any notice, demand, request, consent,
approval, declaration or other communication to the persons designated above to
receive copies shall not adversely affect the effectiveness of such notice,
demand, request, consent, approval, declaration or other communication.
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13.9 WAIVER OF NOTICES. Unless otherwise expressly provided herein, the
Borrowers waive presentment, and notice of demand or dishonor and protest as to
any instrument, notice of intent to accelerate the Obligations and notice of
acceleration of the Obligations, as well as any and all other notices to which
it might otherwise be entitled. No notice to or demand on the Borrowers which
the Administrative Agent or any Lender may elect to give shall entitle the
Borrowers to any or further notice or demand in the same, similar or other
circumstances.
13.10 BINDING EFFECT. The provisions of this Agreement shall be binding
upon and inure to the benefit of the respective representatives, successors, and
assigns of the parties hereto; PROVIDED, HOWEVER, that no interest herein may be
assigned by the Borrowers without prior written consent of the Administrative
Agent and each Lender. The rights and benefits of the Administrative Agent and
the Lenders hereunder shall, if such Persons so agree, inure to any party
acquiring any interest in the Obligations or any part thereof.
13.11 INDEMNITY OF THE ADMINISTRATIVE AGENT AND THE LENDERS BY THE
BORROWERS.
(a) The Borrowers agree to defend, indemnify and hold the
Administrative Agent-Related Persons, and each Lender and each of its respective
officers, directors, employees, counsel, agents and attorneys-in-fact (each, an
"Indemnified Person") harmless from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
charges, expenses and disbursements (including, without limitation, Enforcement
Costs) of any kind or nature whatsoever which may at any time (including at any
time following repayment of the Loans and the termination, resignation or
replacement of the Administrative Agent or replacement of any Lender) be imposed
on, incurred by or asserted against any such Person in any way relating to or
arising out of this Agreement or any document contemplated by or referred to
herein, or the transactions contemplated hereby, or any action taken or omitted
by any such Person under or in connection with any of the foregoing, including
with respect to any investigation, litigation or proceeding (including any
Insolvency Proceeding or appellate proceeding) related to or arising out of this
Agreement, any other Loan Document, or the Loans or the use of the proceeds
thereof, whether or not any Indemnified Person is a party thereto (all the
foregoing, collectively, the "Indemnified Liabilities"); PROVIDED, that the
Borrowers shall have no obligation hereunder to any Indemnified Person with
respect to Indemnified Liabilities resulting solely from the willful misconduct
of such Indemnified Person. The agreements in this Section shall survive payment
of all other Obligations.
(b) The Borrowers agree to indemnify, defend and hold harmless
the Administrative Agent and the Lenders from any loss or liability directly or
indirectly arising out of the use, generation, manufacture, production, storage,
release, threatened release, discharge, disposal or presence of a hazardous
substance relating to the Borrowers' operations, business or property. This
indemnity will apply whether the hazardous substance is on, under or about the
Borrowers' property or operations or property leased to the Borrowers. The
indemnity includes but is not limited to Attorneys Costs. The indemnity extends
to the Administrative Agent and the Lenders, their parents, affiliates,
subsidiaries and all of their directors, officers, employees, agents,
successors, attorneys and assigns. "Hazardous substances" means any substance,
material or waste that is or becomes designated or regulated as "toxic,"
"hazardous," "pollutant," or "contaminant" or a similar designation or
regulation under any federal, state or local law (whether under common law,
statute, regulation or otherwise) or judicial or administrative
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interpretation of such, including petroleum or natural gas. This indemnity will
survive repayment of all other Obligations.
13.12 LIMITATION OF LIABILITY. NO CLAIM MAY BE MADE BY ANY BORROWER,
ANY LENDER OR OTHER PERSON AGAINST THE ADMINISTRATIVE AGENT, ANY LENDER, OR THE
AFFILIATES, DIRECTORS, OFFICERS, EMPLOYEES, OR AGENTS OF ANY OF THEM FOR ANY
SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES IN RESPECT OF ANY CLAIM FOR
BREACH OF CONTRACT OR ANY OTHER THEORY OF LIABILITY ARISING OUT OF OR RELATED TO
THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR
ANY ACT, OMISSION OR EVENT OCCURRING IN CONNECTION THEREWITH, AND EACH BORROWER
AND EACH LENDER HEREBY WAIVE, RELEASE AND AGREE NOT TO XXX UPON ANY CLAIM FOR
SUCH DAMAGES, WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED TO
EXIST IN ITS FAVOR.
13.13 FINAL AGREEMENT. This Agreement and the other Loan Documents are
intended by the Borrowers, the Administrative Agent and the Lenders to be the
final, complete, and exclusive expression of the agreement between them. This
Agreement supersedes any and all prior oral or written agreements relating to
the subject matter hereof. No modification, rescission, waiver, release, or
amendment of any provision of this Agreement or any other Loan Document shall be
made, except by a written agreement signed by the Borrowers and a duly
authorized officer of each of the Administrative Agent and the requisite
Lenders.
13.14 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, and by the Administrative Agent, each Lender and each Borrower in
separate counterparts, each of which shall be an original, but all of which
shall together constitute one and the same agreement; signature pages may be
detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document.
13.15 CAPTIONS. The captions contained in this Agreement are for
convenience of reference only, are without substantive meaning and should not be
construed to modify, enlarge, or restrict any provision.
13.16 RIGHT OF SETOFF. In addition to any rights and remedies of the
Lenders provided by law, if an Event of Default exists or the Loans have been
accelerated, each Lender is authorized at any time and from time to time,
without prior notice to the Borrowers, any such notice being waived by the
Borrowers to the fullest extent permitted by law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final) at any
time held by, and other indebtedness at any time owing by, such Lender to or for
the credit or the account of the Borrowers against any and all Obligations owing
to such Lender, now or hereafter existing, irrespective of whether or not the
Administrative Agent or such Lender shall have made demand under this Agreement
or any Loan Document and although such Obligations may be contingent or
unmatured. Each Lender agrees promptly to notify the Borrowers and the
Administrative Agent after any such set-off and application made by such Lender;
PROVIDED, HOWEVER, that the failure to give such notice shall not affect the
validity of such set-off and application. NOTWITHSTANDING THE FOREGOING, NO
LENDER SHALL EXERCISE ANY RIGHT
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OF SET-OFF, BANKER'S LIEN, OR THE LIKE AGAINST ANY DEPOSIT ACCOUNT OR PROPERTY
OF THE BORROWERS HELD OR MAINTAINED BY SUCH LENDER WITHOUT THE PRIOR WRITTEN
UNANIMOUS CONSENT OF THE LENDERS.
13.17 CONFIDENTIALITY.
(a) Each of the Borrowers hereby consents that the
Administrative Agent and each Lender may issue and disseminate to the public
general information describing the credit accommodation entered into pursuant to
this Agreement, including the name and address of the Borrowers and a general
description of the Borrowers' business and may use the Borrowers' name in
advertising and other promotional material.
(b) Each Lender severally agrees to take normal and reasonable
precautions and exercise due care to maintain the confidentiality of all
information provided to the Administrative Agent or such Lender by or on behalf
of the Borrowers, under this Agreement or any other Loan Document, except to the
extent that such information (i) was or becomes generally available to the
public other than as a result of disclosure by the Administrative Agent or such
Lender, or (ii) was or becomes available on a nonconfidential basis from a
source other than the Borrowers, provided that such source is not bound by a
confidentiality agreement with the Borrowers known to the Administrative Agent
or such Lender; PROVIDED, HOWEVER, that the Administrative Agent and any Lender
may disclose such information (1) at the request or pursuant to any requirement
of any Governmental Authority to which the Administrative Agent or such Lender
is subject or in connection with an examination of the Administrative Agent or
such Lender by any such Governmental Authority; (2) pursuant to subpoena or
other court process; (3) when required to do so in accordance with the
provisions of any applicable Requirement of Law; (4) to the extent reasonably
required in connection with any litigation or proceeding (including, but not
limited to, any bankruptcy proceeding) to which the Administrative Agent, any
Lender or their respective Affiliates may be party; (5) to the extent reasonably
required in connection with the exercise of any remedy hereunder or under any
other Loan Document; (6) to the Administrative Agent's or such Lender's
independent auditors, accountants, attorneys and other professional advisors;
(7) to any prospective Participant or Assignee under any Assignment and
Acceptance, actual or potential, provided that such prospective Participant or
Assignee agrees to keep such information confidential to the same extent
required of the Administrative Agent and the Lenders hereunder; (8) as expressly
permitted under the terms of any other document or agreement regarding
confidentiality to which the any of the Borrowers is party or is deemed party
with the Administrative Agent or such Lender, and (9) to its Affiliates.
13.18 CONFLICTS WITH OTHER LOAN DOCUMENTS. Unless otherwise expressly
provided in this Agreement (or in another Loan Document by specific reference to
the applicable provision contained in this Agreement), if any provision
contained in this Agreement conflicts with any provision of any other Loan
Document, the provision contained in this Agreement shall govern and control.
13.19 JOINT AND SEVERAL LIABILITY.
Subject to the limitations of SECTION 3.10(a) in each
instance:
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The Parent shall be jointly and severally liable with each
Borrower for all amounts due to the Administrative Agent, any Lender under this
Agreement or otherwise with respect to the Obligations, regardless of which
Borrower actually receives Loans or other extensions of credit hereunder or the
amount of such Loans received or the manner in which the Administrative Agent
and/or such Lender accounts for such Loans or other extensions of credit on its
books and records. The joint and several liability of the Parent with respect to
Obligations, including, without limitation, the Loans made to other Borrowers
hereunder, shall be separate and distinct obligations, but all such Obligations
shall be primary obligations of the Parent. The liability of the Borrowers other
than the Parent are governed by SECTION 3.10(a) in each instance.
The Obligations of the Parent (and to the limited extent
permitted by SECTION 3.10(a), other Borrowers) arising as a result of the joint
and several liability hereunder or otherwise under the Loan Documents with
respect to Loans, other extensions of credit made to the other Borrowers
hereunder or otherwise with respect to the Obligations shall, to the fullest
extent permitted by law, be unconditional irrespective of (a) the validity or
enforceability, avoidance or subordination of the Obligations of the other
Borrowers or of any promissory note or other document evidencing all or any part
of the Obligations of the other Borrowers, (b) the absence of any attempt to
collect the Obligations from the other Borrowers, any other guarantor, or any
other security therefor, or the absence of any other action to enforce the same,
(c) the waiver, consent, extension, forbearance or granting of any indulgence by
the Administrative Agent, any Lender with respect to any provision of any
instrument evidencing the Obligations of the other Borrowers, or any part
thereof, or any other agreement now or hereafter executed by the other Borrowers
and delivered to the Administrative Agent, any Lender, (d) the failure by the
Administrative Agent or any Lender to take any steps to perfect and maintain its
security interest in, or to preserve its rights to, any security or collateral
for the Obligations of the other Borrowers, (e) the Administrative Agent's or
Lender's election, in any proceeding instituted under the Bankruptcy Code, of
the application of Section 1111(b)(2) of the Bankruptcy Code, (f) any borrowing
or grant of a security interest by the other Borrowers, as debtor-in-possession
under Section 364 of the Bankruptcy Code, (g) the disallowance of all or any
portion of the Administrative Agent's or any Lender's claim(s) for the repayment
of the Obligations of the other Borrowers under Section 502 of the Bankruptcy
Code, or (h) any other circumstances which might constitute a legal or equitable
discharge or defense of a guarantor or of the other Borrowers. With respect to
the Obligations of the Parent (and to the limited extent permitted by SECTION
3.10(a), other Borrowers) arising as a result of the joint and several liability
hereunder with respect to Loans, other extensions of credit made to either of
the other Borrowers hereunder, and other Obligations, each such Borrower waives,
until the Obligations shall have been paid in full and the Loan Agreement shall
have been terminated, any right to enforce any right of subrogation or any
remedy which the Administrative Agent or any Lender now has or may hereafter
have against any Borrower, any endorser or any guarantor of all or any part of
the Obligations, and any benefit of, and any right to participate in, any
security or collateral given to the Administrative Agent, any Lender to secure
payment of the Obligations or any other liability of the Borrowers to the
Administrative Agent, any Lender.
During the continuance of any Event of Default, the
Administrative Agent may proceed directly and at once, without notice, against
any of the Borrowers to collect and recover the full amount, or any portion of
the Obligations for which such Borrower is liable, without first proceeding
against the other Borrowers or any other Person, or against any security or
collateral
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for the Obligations. Each Borrower consents and agrees that the Administrative
Agent shall be under no obligation to marshal any assets in favor of any
Borrower or against or in payment of any or all of the Obligations.
13.20 CONTRIBUTION AND INDEMNIFICATION AMONG THE BORROWERS.
To the extent that any Borrower shall, under this Agreement as
a joint and several obligor, repay any of the Obligations constituting Loans
made to another Borrower hereunder or other Obligations incurred directly and
primarily by any other Borrower (an "Accommodation Payment"), then the Borrower
making such Accommodation Payment shall be entitled to contribution and
indemnification from, and be reimbursed by, each of the other Borrowers in an
amount, for each of such other Borrowers, equal to a fraction of such
Accommodation Payment, the numerator of which fraction is such other Borrower's
"Allocable Amount" (as defined below) and the denominator of which is the sum of
the Allocable Amounts of all of the Borrowers. As of any date of determination,
the "Allocable Amount" of each Borrower shall be equal to the maximum amount of
liability for Accommodation Payments which could be asserted against such
Borrower hereunder without (a) rendering such Borrower "insolvent" within the
meaning of Section 101 (31) of the Bankruptcy Code, Section 2 of the Uniform
Fraudulent Transfer Act ("UFTA") or Section 2 of the Uniform Fraudulent
Conveyance Act ("UFCA"), (b) leaving such Borrower with unreasonably small
capital or assets, within the meaning of Section 548 of the Bankruptcy Code,
Section 4 of the UFTA, or Section 5 of the UFCA, or (c) leaving such Borrower
unable to pay its debts as they become due within the meaning of Section 548 of
the Bankruptcy Code, Section 4 of the UFTA, or Section 5 of the UFCA. All rights
and claims of contribution, indemnification and reimbursement under this section
shall be subordinate in right of payment to the prior payment in full of the
Obligations. The provisions of this section shall, to the extent expressly
inconsistent with any provision in any Loan Document, supersede such
inconsistent provision.
13.21 AGENCY OF THE PARENT FOR EACH OTHER BORROWER.
Each of the other Borrowers appoints the Parent as its
administrative agent for all purposes relevant to this Agreement, including
(without limitation) the giving and receipt of notices and execution and
delivery of all documents, instruments and certificates contemplated herein and
all modifications hereto. Any acknowledgement, consent, direction, certification
or other action which might otherwise be valid or effective only if given or
taken by all of the Borrowers or acting singly, shall be valid and effective if
given or taken only by the Parent, whether or not the other Borrower joins
therein.
13.22 NO LIABILITY OF BRAZILIAN LENDER; INDEMNIFICATION.
The parties hereto hereby agree that the Brazilian Lender
shall not be liable for any reason whatsoever for any obligation, representation
or warranty arising out of or in connection with this Agreement. The Borrowers,
jointly and severally, hereby agree to indemnify and hold harmless the Brazilian
Lender from any claim or dispute arising out of or in connection with this
Agreement.
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IN WITNESS WHEREOF, the parties have entered into this Agreement on the
date first above written.
[SIGNATURES ON FOLLOWING PAGES]
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SIGNATURE PAGE TO
CREDIT AGREEMENT
----------------
UNIFRAX CORPORATION
By:/s/ XXXX X. XXXX
------------------------------
Xxxx X. Xxxx, Vice President
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104
SIGNATURE PAGE TO
CREDIT AGREEMENT
----------------
UNIFRAX LIMITED
By:/s/ XXXX X. XXXX
------------------------------
Xxxx X. Xxxx, Attorney-in-Fact
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105
SIGNATURE PAGE TO
CREDIT AGREEMENT
----------------
UK HOLDCO LIMITED
By:/s/ XXXX X. XXXX
------------------------------
Xxxx X. Xxxx, Director
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106
SIGNATURE PAGE TO
CREDIT AGREEMENT
----------------
UNIFRAX HOLDING FRANCE
By:/s/ XXXX X. XXXX
------------------------------
Xxxx X. Xxxx, Director
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SIGNATURE PAGE TO
CREDIT AGREEMENT
----------------
BANK OF AMERICA, N.A., as the
Administrative Agent
By:/s/ XXXXX X. XXXXXXXXXX
---------------------------
Xxxxx X. Xxxxxxxxxx,
Vice President
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SIGNATURE PAGE TO
CREDIT AGREEMENT
----------------
NATIONAL CITY BANK, as
Co-Administrative Agent
By:/s/ XXXXXXX X. XXXXXXX
---------------------------
Xxxxxxx X. Xxxxxxx,
Vice President
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SIGNATURE PAGE TO
CREDIT AGREEMENT
----------------
BANK OF AMERICA, N.A., as a
Lender
By:/s/ XXXXX X. XXXXXXXXXX
---------------------------
Xxxxx X. Xxxxxxxxxx,
Vice President
--------------------------------------------------------------------------------------
BANK OF AMERICA, N.A.
--------------------------------------------------------------------------------------
CREDIT FACILITY COMMITMENT PRO RATA SHARE
--------------------------------------------------------------------------------------
US Revolving Loans $6,500,000 34.210%
--------------------------------------------------------------------------------------
UK Revolving Loans (pound)4,123,711.34 100%
--------------------------------------------------------------------------------------
Term Loan (UK) (pound)4,123,711.34 100%
--------------------------------------------------------------------------------------
Term Loan (France) Euro 5,727,376.86 50%
--------------------------------------------------------------------------------------
Brazilian Letter of Credit under $ 4,500,000 50%
the Term Credit Facility
--------------------------------------------------------------------------------------
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SIGNATURE PAGE TO
CREDIT AGREEMENT
----------------
NATIONAL CITY BANK, as a Lender
By:/s/ XXXXXXX X. XXXXXXX
-----------------------------
Xxxxxxx X. Xxxxxxx,
Vice President
--------------------------------------------------------------------------------------
NATIONAL CITY BANK
--------------------------------------------------------------------------------------
CREDIT FACILITY COMMITMENT PRO RATA SHARE
--------------------------------------------------------------------------------------
US Revolving Loans $12,500,000 65.789%
--------------------------------------------------------------------------------------
UK Revolving Loans (pound)0 0%
--------------------------------------------------------------------------------------
Term Loan (UK) (pound)0 0%
--------------------------------------------------------------------------------------
Term Loan (France) Euro 5,727,376.86 50%
--------------------------------------------------------------------------------------
Brazilian Letter of Credit under $ 4,500,000 50%
the Term Credit Facility
--------------------------------------------------------------------------------------
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SIGNATURE PAGE TO
CREDIT AGREEMENT
----------------
Multi Banco, S.A. joins in the execution of this Credit Agreement
solely for the purpose of confirming its agreement under the laws of Brazil to
provide the loans described in the Brazilian Loan Documents, subject to the
terms and conditions of the Brazilian Loan Documents, in reliance upon the
Brazilian Letter of Credit and, in accordance with Section 13.22 of the Credit
Agreement, without liability for any other commitments, liabilities or
obligations under the Credit Agreement.
MULTI BANCO, S.A., as Brazilian Lender
By:/s/ XXXX XXXXXX XXXX
----------------------------------
Xxxx Xxxxxx Xxxx
Title: Vice President, Director
-------------------------------
103
112
SIGNATURE PAGE TO
CREDIT AGREEMENT
----------------
NAF Brazil Ltda. joins in the execution of this Credit Agreement solely
for the purpose of confirming its agreement under the laws of Brazil to borrow
the loans described in the Brazilian Loan Documents, subject to the terms and
conditions of the Brazilian Loan Documents, in reliance upon the Brazilian
Letter of Credit.
NAF BRAZIL LTDA. ("Unifrax Brazil")
By:/s/ XXXXXX XXXXX XXXXX XXXXXXXX
----------------------------------
Xxxxxx Xxxxx Xxxxx Xxxxxxxx
Title: Attorney-In-Fact
------------------------------
104
