$45,000,000.00
CREDIT AGREEMENT
dated as of
July 15, 1997
among
NATIONAL VISION ASSOCIATES, LTD.
The Banks Listed Herein
and
WACHOVIA BANK, N.A.,
as Agent
CREDIT AGREEMENT
CREDIT AGREEMENT dated as of July 15, 1997, among NATIONAL
VISION ASSOCIATES, LTD., the BANKS listed on the signature pages
hereof and WACHOVIA BANK, N.A., as Agent.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The terms as defined in this
Section 1.01 shall, for all purposes of this Agreement and any
amendment hereto (except as herein otherwise expressly provided or
unless the context otherwise requires), have the meanings set forth
herein:
"Acquisition(s)" means the purchase or other acquisition (by
merger or otherwise) by the Borrower or any Subsidiary, outside of
the ordinary course of business, of a substantial portion of (i) the
assets or equity (stock, partnership interest, or other interest) of
a Person engaged in the retail optical business or (ii) the assets
relating to one or more business locations relating to the
Borrower's line of business as of the Closing Date.
"Adjusted London Interbank Offered Rate" has the meaning set
forth in Section 2.05(c).
"Affiliate" of any relevant Person means (i) any Person that
directly, or indirectly through one or more intermediaries, controls
the relevant Person (a "Controlling Person"), (ii) any Person (other
than the relevant Person or a Subsidiary of the relevant Person)
which is controlled by or is under common control with a Controlling
Person, or (iii) any Person (other than a Subsidiary of the relevant
Person) of which the relevant Person owns, directly or indirectly,
20% or more of the common stock or equivalent equity interests. As
used herein, the term "control" means possession, directly or
indirectly, of the power to direct or cause the direction of the
management or policies of a Person, whether through the ownership of
voting securities, by contract or otherwise.
"Agent" means Wachovia Bank, N.A., a national banking
association organized under the laws of the United States of
America, in its capacity as agent for the Banks hereunder, and its
successors and permitted assigns in such capacity.
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"Agent's Letter Agreement" means that certain letter agreement,
dated as of June 12, 1997 between the Borrower and the Agent
relating to the structure of the Loans, and certain fees from time
to time payable by the Borrower to the Agent, together with all
amendments and modifications thereto.
"Agreement" means this Credit Agreement, together with all
amendments and supplements hereto.
"Amortization" means, for any period, the sum of all
amortization expenses of the Borrower and its Consolidated
Subsidiaries for such period, as determined in accordance with
GAAP.
"Applicable Margin" has the meaning set forth in Section
2.05(a).
"Assignee" has the meaning set forth in Section 9.08(c).
"Assignment and Acceptance" means an Assignment and Acceptance
executed in accordance with Section 9.08(c) in the form attached
hereto as Exhibit D.
"Authority" has the meaning set forth in Section 8.02.
"Bank" means each bank listed on the signature pages hereof as
having a Commitment, and its successors and assigns.
"Base Rate" means for any Base Rate Loan for any day, the rate
per annum equal to the higher as of such day of (i) the Prime Rate,
or (ii) one-half of one percent above the Federal Funds Rate. For
purposes of determining the Base Rate for any day, changes in the
Prime Rate or the Federal Funds Rate shall be effective on the date
of each such change.
"Base Rate Loan" means a Loan to be made as a Base Rate Loan
pursuant to the applicable Notice of Borrowing, Section 2.02(f), or
Article VIII, as applicable.
"Borrower" means National Vision Associates, Ltd., a Georgia
corporation, and its successors and its permitted assigns.
"Borrowing" means a borrowing hereunder consisting of Loans
made to the Borrower at the same time by the Banks pursuant to
Article II. A Borrowing is a "Base Rate Borrowing" if such Loans
are Base Rate Loans or a "Euro-Dollar Borrowing" if such Loans are
Euro-Dollar Loans.
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"Capital Stock" means any nonredeemable capital stock of the
Borrower or any Consolidated Subsidiary (to the extent issued to a
Person other than the Borrower), whether common or preferred.
"CERCLA" means the Comprehensive Environmental Response
Compensation and Liability Act, 42 U.S.C. Section 9601 et. seq. and its
implementing regulations and amendments.
"CERCLIS" means the Comprehensive Environmental Response
Compensation and Liability Inventory System established pursuant to
CERCLA.
"Change of Control" means the occurrence of any one, or more,
or all of the following events: (i) any Person or two or more
Persons (other than Xx. Xx Xxxxxx, Xxx. Xx Xxxxxx, any one or more
of their lineal descendants and any estate of any of the foregoing)
acting in concert shall have acquired beneficial ownership (within
the meaning of Rule 13d-3 of the Securities and Exchange Commission
under the Securities Exchange Act of 1934) of 35.0% or more of the
outstanding shares of the voting stock of the Borrower; or (ii) as
of any date a majority of the Board of Directors of the Borrower
consists of individuals who were not either (A) directors of the
Borrower as of the corresponding date of the previous year, (B)
selected or nominated to become directors by the Board of Directors
of the Borrower of which a majority consisted of individuals
described in clause (A), or (C) selected or nominated to become
directors by the Board of Directors of the Borrower of which a
majority consisted of individuals described in clause (A) and
individuals described in clause (B).
"Change of Law" shall have the meaning set forth in Section
8.02.
"Closing Certificate" has the meaning set forth in Section
3.01(e).
"Closing Date" means July 15, 1997.
"Code" means the Internal Revenue Code of 1986, as amended, or
any successor Federal tax code.
"Commitment" means, with respect to each Bank, the amount set
forth opposite the name of such Bank on the signature pages hereof,
as such amount may be reduced from time to time pursuant to Sections
2.07 and 2.08.
"Compliance Certificate" has the meaning set forth in Section
5.01(c).
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"Consolidated Cash Flow" means, as of any date of
determination, for any period, (i) Consolidated Net Income plus
(ii) to the extent deducted from earnings in determining
Consolidated Net Income, without duplication, the sum of the
Borrower's and its Consolidated Subsidiaries (x) Depreciation,
(y) Amortization, and (z) other non-cash charges, all determined in
accordance with GAAP.
"Consolidated Debt" means at any date the Debt of the Borrower
and its Consolidated Subsidiaries, determined on a consolidated
basis as of such date.
"Consolidated Fixed Charges" for any period means the sum of
(i) Consolidated Interest Expense for such period, and (ii) all
payment obligations in the nature of rent payments under vision
center occupancy licenses and all other master license agreements of
the Borrower and its Consolidated Subsidiaries.
"Consolidated Interest Expense" for any period means interest,
whether expensed or capitalized, in respect of Consolidated Debt
outstanding during such period.
"Consolidated Net Income" means, for any period, the Net Income
of the Borrower and its Consolidated Subsidiaries determined on a
consolidated basis, but excluding (i) extraordinary items and (ii)
any equity interests of the Borrower or any Subsidiary in the
unremitted earnings of any Person that is not a Subsidiary.
"Consolidated Operating Profits" means, for any period, the
Operating Profits of the Borrower and its Consolidated Subsidiaries.
"Consolidated Subsidiary" means at any date any Material
Subsidiary the accounts of which, in accordance with GAAP, would be
consolidated with those of the Borrower in its consolidated
financial statements as of such date.
"Consolidated Tangible Net Worth" means, at any time,
Stockholders' Equity, less the sum of the value, as set forth or
reflected on the most recent consolidated balance sheet of the
Borrower and its Consolidated Subsidiaries, prepared in accordance
with GAAP, of:
(A) Any surplus resulting from any write-up of assets
subsequent to December 31, 1996;
(B) All assets which would be treated as intangible
assets for balance sheet presentation purposes under GAAP,
including without limitation goodwill (whether representing
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the excess of cost over book value of assets acquired, or
otherwise), trademarks, tradenames, copyrights, patents and
technologies, and unamortized debt discount and expense;
(C) To the extent not included in (B) of this definition,
any amount at which shares of Capital Stock of the Borrower
appear as an asset on the balance sheet of the Borrower and its
Consolidated Subsidiaries;
(D) Loans or advances to stockholders, directors,
officers or employees; and
(E) To the extent not included in (B) of this definition,
deferred expenses.
"Consolidated Total Assets" means, at any time, the total
assets of the Borrower and its Consolidated Subsidiaries, determined
on a consolidated basis, as set forth or reflected on the most
recent consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries, prepared in accordance with GAAP.
"Consolidated Total Tangible Capital" means, at any time, the
sum of (i) Consolidated Tangible Net Worth, and (ii) Consolidated
Debt, provided that for purposes of this definition only, in
determining Consolidated Debt, clause (vii) of the definition of
Debt contained in this Agreement shall be disregarded.
Provided, however, Consolidated Tangible Net Worth shall include the
unamortized portion of goodwill from time to time, not exceeding
$4,500,000 which arises out of the transactions provided for in a
certain Agreement for Assignment of License Interests and Related
Matters dated as of November 1, 1996, by and among the Borrower,
certain of the Subsidiaries, Eyecare Leasing, Inc., an Alabama
corporation, Xxxxxxx-Xxxxxxxx, Inc., a California corporation, Xxxxx
X. Xxxxxxx, and Xxxxxxx X. Xxxxxxxx.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not
incorporated) under common control which, together with the
Borrower, are treated as a single employer under Section 414 of the
Code.
"Debt" of any Person means at any date, without duplication,
(i) all obligations of such Person for borrowed money, (ii) all
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments, (iii) all obligations of such Person to
pay the deferred purchase price of property or services, except
trade accounts payable arising in the ordinary course of business,
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(iv) all obligations of such Person as lessee under capital leases,
(v) all obligations of such Person to reimburse any bank or other
Person in respect of amounts payable under a banker's acceptance,
(vi) all Redeemable Preferred Stock of such Person (in the event
such Person is a corporation), (vii) all obligations of such Person
to reimburse any bank or other Person in respect of amounts paid
under a letter of credit or similar instrument, (viii) all Debt of
others secured by a Lien on any asset of such Person, whether or not
such Debt is assumed by such Person, and (ix) all Debt of others
Guaranteed by such Person.
"Debt to Cash Flow Ratio" shall mean the ratio of (i)
Consolidated Debt to (ii) Consolidated Cash Flow. The Debt to Cash
Flow Ratio shall be computed on a rolling 4 Fiscal Quarter basis
(consistent with the procedure set forth in Section 5.03).
"Default" means any condition or event which constitutes an
Event of Default or which with the giving of notice or lapse of time
or both would, unless cured or waived, become an Event of Default.
"Default Rate" means, with respect to any Loan, on any day, the
sum of 2% plus the then highest interest rate (including the
Applicable Margin) which may be applicable to any Loans hereunder
(irrespective of whether any such type of Loans are actually
outstanding hereunder).
"Depreciation" means for any period the sum of all depreciation
expenses of the Borrower and its Consolidated Subsidiaries for such
period, as determined in accordance with GAAP.
"Dividends" means for any period the sum of all dividends paid
or declared during such period in respect of any Capital Stock and
Redeemable Preferred Stock (other than dividends paid or payable in
the form of additional Capital Stock).
"Dollars" or "$" means dollars in lawful currency of the United
States of America.
"Domestic Business Day" means any day except a Saturday, Sunday
or other day on which commercial banks in Georgia are authorized by
law to close.
"Domestic Subsidiary" shall mean each of those Subsidiaries of
the Borrower, as listed on Schedule 4.08, which is organized under
the laws of the United States of America, and which has at least
95.0% of its assets and operations located within the United States
of America.
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"Environmental Authority" means any foreign, federal, state,
local or regional government that exercises any form of jurisdiction
or authority under any Environmental Requirement.
"Environmental Authorizations" means all licenses, permits,
orders, approvals, notices, registrations or other legal
prerequisites for conducting the business of the Borrower or any
Subsidiary required by any Environmental Requirement.
"Environmental Judgments and Orders" means all judgments,
decrees or orders arising from or in any way associated with any
Environmental Requirements, whether or not entered upon consent, or
written agreements with an Environmental Authority or other entity
arising from or in any way associated with any Environmental
Requirement, whether or not incorporated in a judgment, decree or
order.
"Environmental Liabilities" means any liabilities, whether
accrued, contingent or otherwise, arising from and in any way
associated with any Environmental Requirements.
"Environmental Notices" means notice from any Environmental
Authority or by any other person or entity, of possible or alleged
noncompliance with or liability under any Environmental Requirement,
including without limitation any complaints, citations, demands or
requests from any Environmental Authority or from any other person
or entity for correction of any violation of any Environmental
Requirement or any investigations concerning any violation of any
Environmental Requirement.
"Environmental Proceedings" means any judicial or
administrative proceedings arising from or in any way associated
with any Environmental Requirement.
"Environmental Releases" means releases as defined in CERCLA or
under any applicable state or local environmental law or regulation.
"Environmental Requirements" means any legal requirement
relating to health, safety or the environment and applicable to the
Borrower, any Subsidiary or the Properties, including but not
limited to any such requirement under CERCLA or similar state
legislation and all federal, state and local laws, ordinances,
regulations, orders, writs, decrees and common law.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, or any successor law. Any
reference to any provision of ERISA shall also be deemed to be a
reference to any successor provision or provisions thereof.
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"Euro-Dollar Business Day" means any Domestic Business Day on
which dealings in Dollar deposits are carried out in the London
interbank market.
"Euro-Dollar Loan" means a Loan to be made as a Euro-Dollar
Loan pursuant to the applicable Notice of Borrowing.
"Euro-Dollar Reserve Percentage" has the meaning set forth in
Section 2.05(c).
"Event of Default" has the meaning set forth in Section 6.01.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the next higher 1/100th of 1%)
equal to the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank of New York on the Domestic Business Day next
succeeding such day, provided that (i) if the day for which such
rate is to be determined is not a Domestic Business Day, the Federal
Funds Rate for such day shall be such rate on such transactions on
the next preceding Domestic Business Day as so published on the next
succeeding Domestic Business Day, and (ii) if such rate is not so
published for any day, the Federal Funds Rate for such day shall be
the average rate charged to the Agent on such day on such
transactions, as determined by the Agent.
"Fiscal Quarter" means any fiscal quarter of the Borrower.
"Fiscal Year" means any fiscal year of the Borrower.
"Foreign Subsidiary" means each of those Subsidiaries of the
Borrower, as listed on Schedule 4.08, which is organized under the
laws of any jurisdiction other than the United States of America.
"GAAP" means (i) for the Borrower and each of its Domestic
Subsidiaries, generally accepted accounting principles in the United
States of America, and (ii) for each of the Borrower's Foreign
Subsidiaries, generally accepted accounting principles in effect in
the jurisdiction in which such Foreign Subsidiary's operations are
conducted, in each case applied on a basis consistent with those
which, in accordance with Section 1.02, are to be used in making the
calculations for purposes of determining compliance with the terms
of this Agreement.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any
Debt or other obligation of any other Person and, without limiting
8
the generality of the foregoing, any obligation, direct or indirect,
contingent or otherwise, of such Person (i) to secure, purchase or
pay (or advance or supply funds for the purchase or payment of) such
Debt or other obligation (whether arising by virtue of partnership
arrangements, by agreement to keep-well, to purchase assets, goods,
securities or services, to provide collateral security, to
take-or-pay, or to maintain financial statement conditions or
otherwise) or (ii) entered into for the purpose of assuring in any
other manner the obligee of such Debt or other obligation of the
payment thereof or to protect such obligee against loss in respect
thereof (in whole or in part), provided that the term Guarantee
shall not include endorsements for collection or deposit in the
ordinary course of business. The term "Guarantee" used as a verb
has a corresponding meaning.
"Hazardous Materials" includes, without limitation, (a) solid
or hazardous waste, as defined in the Resource Conservation and
Recovery Act of 1980, 42 U.S.C. Section 6901 et seq. and its implementing
regulations and amendments, or in any applicable state or local law
or regulation, (b) "hazardous substance", "pollutant", or
"contaminant" as defined in CERCLA, or in any applicable state or
local law or regulation, (c) gasoline, or any other petroleum
product or by-product, including, crude oil or any fraction thereof,
or (d) pesticides, as defined in the Federal Insecticide, Fungicide,
and Rodenticide Act of 1975, or in any applicable state or local law
or regulation, as each such Act, statute or regulation may be
amended from time to time.
"Income Available for Consolidated Fixed Charges" for any
period means the sum of (i) Consolidated Net Income, (ii) taxes on
income and (iii) Consolidated Fixed Charges, all determined with
respect to the Borrower and its Consolidated Subsidiaries on a
consolidated basis for such period and in accordance with GAAP.
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing and
ending on the numerically corresponding day in the first, second,
third or sixth month thereafter, as the Borrower may elect in the
applicable Notice of Borrowing; provided that:
(a) any Interest Period (subject to paragraph (c) below)
which would otherwise end on a day which is not a Euro-Dollar
Business Day shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-Dollar Business Day
falls in another calendar month, in which case such Interest
Period shall end on the next preceding Euro-Dollar Business
Day;
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(b) any Interest Period which begins on the last
Euro-Dollar Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the
appropriate subsequent calendar month) shall, subject to
paragraph (c) below, end on the last Euro-Dollar Business Day
of the appropriate subsequent calendar month; and
(c) no Interest Period may be selected which begins before
the Termination Date and would otherwise end after the
Termination Date.
(2) with respect to each Base Rate Borrowing, the period commencing
on the date of such Borrowing and ending 30 days thereafter;
provided that:
(a) any Interest Period (subject to paragraph (b) below)
which would otherwise end on a day which is not a Domestic
Business Day shall be extended to the next succeeding Domestic
Business Day; and
(b) no Interest Period which begins before the
Termination Date and would otherwise end after the Termination
Date may be selected.
"Investment" means any investment in any Person, whether by
means of purchase or acquisition of obligations or securities of
such Person, capital contribution to such Person, loan or advance to
such Person, making of a time deposit with such Person, Guarantee or
assumption of any obligation of such Person or otherwise.
"Lending Office" means, as to each Bank, its office located at
its address set forth on the signature pages hereof (or identified
on the signature pages hereof as its Lending Office or such other
office as such Bank may hereafter designate as its Lending Office)
by notice to the Borrower and the Agent.
"Lien" means, with respect to any asset, any mortgage, deed to
secure debt, deed of trust, lien, pledge, charge, security interest,
security title, preferential arrangement which has the practical
effect of constituting a security interest or encumbrance, or
encumbrance or servitude of any kind in respect of such asset to
secure or assure payment of a Debt or a Guarantee, whether by
consensual agreement or by operation of statute or other law, or by
any agreement, contingent or otherwise, to provide any of the
foregoing. For the purposes of this Agreement, the Borrower or any
Subsidiary shall be deemed to own subject to a Lien any asset which
it has acquired or holds subject to the interest of a vendor or
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lessor under any conditional sale agreement, capital lease or other
title retention agreement relating to such asset.
"Loan" means a Base Rate Loan or a Euro-Dollar Loan and "Loans"
means any one, or more, or all of the Base Rate Loans or Euro-Dollar
Loans, as the context shall require.
"Loan Documents" means this Agreement, the Notes, any other
document evidencing, relating to or securing the Loans, and any
other document or instrument delivered from time to time in
connection with this Agreement, the Notes or the Loans, as such
documents and instruments may be amended or supplemented from time
to time.
"London Interbank Offered Rate" has the meaning set forth in
Section 2.05(c).
"Margin Stock" means "margin stock" as defined in Regulations
G, T, U or X.
"Material Adverse Effect" means, with respect to any event,
act, condition or occurrence of whatever nature (including any
adverse determination in any litigation, arbitration, or
governmental investigation or proceeding), whether singly or in
conjunction with any other event or events, act or acts, condition
or conditions, occurrence or occurrences, whether or not related, a
material adverse change in, or a material adverse effect upon, any
of (a) the financial condition, operations, business, properties or
prospects of the Borrower and its Consolidated Subsidiaries taken as
a whole, (b) the rights and remedies of the Agent or the Banks under
the Loan Documents, or the ability of the Borrower to perform its
obligations under the Loan Documents to which it is a party, as
applicable, or (c) the legality, validity or enforceability of any
Loan Document.
"Material Subsidiary" means, as of any date of determination,
each of those Subsidiaries which, determined in accordance with
GAAP, either (x) has assets equal to or in excess of 5.0% of
Consolidated Total Assets or (y) had Net Income equal to or in
excess of 5.0% of Consolidated Net Income during the most recently
ended fiscal year of such Subsidiary; provided, that, should any
Subsidiary have been in existence for a period of less than one
fiscal year, then, such Subsidiary's Net Income shall be annualized
so as to determine whether it shall be characterized as a "Material
Subsidiary" for purposes hereof.
"Multiemployer Plan" shall have the meaning set forth in
Section 4001(a)(3) of ERISA.
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"Net Income" means, as applied to any Person for any period,
the aggregate amount of net income of such Person, after taxes, for
such period, as determined in accordance with GAAP.
"Net Proceeds of Capital Stock" means any proceeds received by
the Borrower or a Consolidated Subsidiary in respect of the issuance
of Capital Stock, after deducting therefrom all reasonable and
customary costs and expenses incurred by the Borrower or such
Consolidated Subsidiary directly in connection with the issuance of
such Capital Stock.
"Notes" means promissory notes of the Borrower, substantially
in the form of Exhibit A, evidencing the obligation of the Borrower
to repay the Loans, together with all amendments, consolidations,
modifications, renewals, and supplements thereto.
"Notice of Borrowing" has the meaning set forth in Section
2.02.
"Operating Profits" means, as applied to any Person for any
period, the earnings before interest and taxes of such Person for
such period, as determined in accordance with GAAP.
"Participant" has the meaning set forth in Section 9.08(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Person" means an individual, a corporation, a partnership, an
unincorporated association, a trust or any other entity or
organization, including, but not limited to, a government or
political subdivision or an agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan which
is covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Code and is either (i) maintained
by a member of the Controlled Group for employees of any member of
the Controlled Group or (ii) maintained pursuant to a collective
bargaining agreement or any other arrangement under which more than
one employer makes contributions and to which a member of the
Controlled Group is then making or accruing an obligation to make
contributions or has within the preceding 5 plan years made
contributions.
"Prime Rate" refers to that interest rate so denominated and
set by Wachovia from time to time as an interest rate basis for
borrowings. The Prime Rate is but one of several interest rate
bases used by Wachovia. Wachovia lends at interest rates above and
below the Prime Rate.
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"Properties" means all real property owned, leased or otherwise
used or occupied by the Borrower or any Subsidiary, wherever
located.
"Redeemable Preferred Stock" of any Person means any preferred
stock issued by such Person which is at any time prior to the
Termination Date either (i) mandatorily redeemable (by sinking fund
or similar payments or otherwise) or (ii) redeemable at the option
of the holder thereof.
"Regulation G" means Regulation G of the Board of Governors of
the Federal Reserve System, as in effect from time to time, together
with all official rulings and interpretations issued thereunder.
"Regulation T" means Regulation T of the Board of Governors of
the Federal Reserve System, as in effect from time to time, together
with all official rulings and interpretations issued thereunder.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time, together
with all official rulings and interpretations issued thereunder.
"Regulation X" means Regulation X of the Board of Governors of
the Federal Reserve System, as in effect from time to time, together
with all official rulings and interpretations issued thereunder.
"Reported Net Income" means, for any period, the Net Income of
the Borrower and its Consolidated Subsidiaries determined on a
consolidated basis.
"Required Banks" means at any time Banks having at least 73.0%
of the aggregate amount of the Commitments or, if the Commitments
are no longer in effect, Banks holding at least 73.0% of the
aggregate outstanding principal amount of the Notes.
"Restricted Payment" means (i) any dividend or other
distribution on any shares of the Borrower's capital stock (except
dividends payable solely in shares of its capital stock) or (ii) any
payment on account of the purchase, redemption, retirement or
acquisition of (a) any shares of the Borrower's capital stock
(except shares acquired upon the conversion thereof into other
shares of its capital stock) or (b) any option, warrant or other
right to acquire shares of the Borrower's capital stock.
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"Senior Debt" means all Debt of the Borrower which has not been
subordinated, on terms and conditions acceptable to the Agent and
the Required Banks in their sole and absolute discretion, to the
obligations of the Borrower to the Banks and the Agent under this
Agreement and the other Loan Documents. All Debt of the Borrower
shall be deemed to be Senior Debt unless and until the Agent and the
Required Banks shall have delivered written notice to the Borrower
that any relevant Debt shall not be deemed to be Senior Debt.
"Stockholders' Equity" means, at any time, the shareholders'
equity of the Borrower and its Consolidated Subsidiaries, as set
forth or reflected on the most recent consolidated balance sheet of
the Borrower and its Consolidated Subsidiaries prepared in
accordance with GAAP, but excluding (i) any Redeemable Preferred
Stock of the Borrower or any of its Consolidated Subsidiaries, and
(ii) amounts that are less than $4,000,000 set forth on that certain
line item described as "cumulative translation adjustments" set
forth on and reflected on the most recent consolidated balance sheet
of the Borrower and its Consolidated Subsidiaries prepared in
accordance with GAAP.
"Subsidiary" means any corporation or other entity of which
securities or other ownership interests having ordinary voting power
to elect a majority of the board of directors or other persons
performing similar functions are at the time directly or indirectly
owned by the Borrower. For purposes of this Agreement, neither
National Vision Associates of Canada, Inc., a corporation organized
under the laws of Canada, nor International Vision Associates of
Canada, Ltd., a Georgia corporation, shall be deemed to be a
"Subsidiary" of the Borrower.
"Termination Date" means July 15, 1999.
"Third Parties" means all lessees, sublessees, licensees and
other users of the Properties, excluding those users of the
Properties in the ordinary course of the Borrower's business and on
a temporary basis.
"Transferee" has the meaning set forth in Section 9.08(d).
"Unfunded Vested Liabilities" means, with respect to any Plan
at any time, the amount (if any) by which (i) the present value of
all vested nonforfeitable benefits under such Plan exceeds (ii) the
fair market value of all Plan assets allocable to such benefits, all
determined as of the then most recent valuation date for such Plan,
but only to the extent that such excess represents a potential
liability of a member of the Controlled Group to the PBGC or the
Plan under Title IV of ERISA.
14
"Unused Commitment" means at any date, with respect to any
Bank, an amount equal to its Commitment less the aggregate
outstanding principal amount of its Loans.
"Wachovia" means Wachovia Bank, N.A., a national banking
association, and its successors.
"Wal-Mart" means Wal-Mart Stores, Inc., a Delaware corporation.
"Wal-Mart Agreement" means that certain Vision Center Master
License Agreement dated as of June 16, 1994, between the Borrower
and Wal-Mart, together with all amendments and supplements thereto
and replacements therefor.
"Wholly Owned Subsidiary" means any Subsidiary, at least 90% of
the shares of capital stock or other ownership interests of which
(except directors' qualifying shares) are at the time directly or
indirectly owned by the Borrower.
SECTION 1.02. Accounting Terms and Determinations. Unless
otherwise specified herein, all terms of an accounting character
used herein shall be interpreted, all accounting determinations
hereunder shall be made, and all financial statements required to be
delivered hereunder shall be prepared, in accordance with GAAP,
applied on a basis consistent (except for changes concurred in by
the Borrower's independent public accountants or otherwise required
by a change in GAAP) with the most recent audited consolidated
financial statements of the Borrower and its Consolidated
Subsidiaries delivered to the Banks unless with respect to any such
change concurred in by the Borrower's independent public accountants
or required by GAAP, in determining compliance with any of the
provisions of this Agreement or any of the other Loan Documents: (i)
the Borrower shall have objected to determining such compliance on
such basis at the time of delivery of such financial statements, or
(ii) the Required Banks shall so object in writing within 30 days
after the delivery of such financial statements, in either of which
events such calculations shall be made on a basis consistent with
those used in the preparation of the latest financial statements as
to which such objection shall not have been made (which, if
objection is made in respect of the first financial statements
delivered under Section 5.01 hereof, shall mean the financial
statements referred to in Section 4.04). Notwithstanding anything to
the contrary contained in this Agreement, in the event of an
Acquisition which is accounted for by a pooling of interests, the
financial results of the Borrower for all Fiscal Quarters which
precede the closing date of the Acquisition (but not for Fiscal
Quarters thereafter) shall, for all purposes under this Agreement
(including, without limitation, the calculation of compliance by the
15
Borrower with all covenants set forth in Article V of this
Agreement), be accounted for and presented as if the Acquisition
were accounted for as a purchase.
SECTION 1.03. References. Unless otherwise indicated,
references in this Agreement to "Articles", "Exhibits", "Schedules",
"Sections" and other Subdivisions are references to articles,
exhibits, schedules, sections and other subdivisions hereof.
SECTION 1.04. Use of Defined Terms. All terms defined in this
Agreement shall have the same defined meanings when used in any of
the other Loan Documents, unless otherwise defined therein or unless
the context shall require otherwise.
SECTION 1.05. Terminology. All personal pronouns used in this
Agreement, whether used in the masculine, feminine or neuter gender,
shall include all other genders; the singular shall include the
plural, and the plural shall include the singular. Titles of
Articles and Sections in this Agreement are for convenience only,
and neither limit nor amplify the provisions of this Agreement.
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Lend. Each Bank severally
agrees, on the terms and conditions set forth herein, to make Loans
to the Borrower from time to time before the Termination Date;
provided, that, immediately after each such Loan is made, the
aggregate principal amount of Loans by such Bank shall not exceed
the amount of its Commitment. Each Borrowing under this Article
shall be in an aggregate principal amount of $1,000,000 or any
larger multiple of $500,000 (except that any such Borrowing may be
in the aggregate amount of the Unused Commitments) and shall be made
from the several Banks ratably in proportion to their respective
Commitments. Within the foregoing limits, the Borrower may borrow
under this Article, repay or, to the extent permitted by Section
2.09, prepay Loans and reborrow under this Section at any time
before the Termination Date.
SECTION 2.02. Method of Borrowing. (a) The Borrower shall
give the Agent notice (a "Notice of Borrowing"), which shall be
substantially in the form of Exhibit E, prior to 11:00 A.M.
(Atlanta, Georgia time) at least 1 Domestic Business Day before each
Base Rate Borrowing and at least 3 Euro-Dollar Business Days before
each Euro-Dollar Borrowing, specifying:
16
(i) the date of such Borrowing, which shall be a Domestic
Business Day in the case of a Base Rate Borrowing or a
Euro-Dollar Business Day in the case of a Euro-Dollar
Borrowing;
(ii) the aggregate amount of such Borrowing;
(iii) whether the Loans comprising such Borrowing are to
be Base Rate Loans or Euro-Dollar Loans; and
(iv) in the case of a Euro-Dollar Borrowing, the duration
of the Interest Period applicable thereto, subject to the
provisions of the definition of Interest Period.
(b) Upon receipt of a Notice of Borrowing, the Agent shall
promptly notify each Bank of the contents thereof and of such
Bank's ratable share of such Borrowing and such Notice of Borrowing
shall not thereafter be revocable by the Borrower.
(c) Not later than 11:00 A.M. (Atlanta, Georgia time) on the
date of each Borrowing, each Bank shall (except as provided in
paragraph (d) of this Section) make available its ratable share of
such Borrowing, in Federal or other funds immediately available in
Atlanta, Georgia, to the Agent at its address referred to in Section
9.01. Unless the Agent determines that any applicable condition
specified in Article III has not been satisfied, the Agent will make
the funds so received from the Banks available to the Borrower at
the Agent's aforesaid address. Unless the Agent receives notice
from a Bank, at the Agent's address referred to in or specified
pursuant to Section 9.01, no later than 4:00 P.M. (local time at
such address) on the Domestic Business Day before the date of a
Borrowing stating that such Bank will not make a Loan in connection
with such Borrowing, the Agent shall be entitled to assume that such
Bank will make a Loan in connection with such Borrowing and, in
reliance on such assumption, the Agent may (but shall not be
obligated to) make available such Bank's ratable share of such
Borrowing to the Borrower for the account of such Bank. If the
Agent makes such Bank's ratable share available to the Borrower and
such Bank does not in fact make its ratable share of such Borrowing
available on such date, the Agent shall be entitled to recover such
Bank's ratable share from such Bank or the Borrower (and for such
purpose shall be entitled to charge such amount to any account of
the Borrower maintained with the Agent), together with interest
thereon for each day during the period from the date of such
Borrowing until such sum shall be paid in full at a rate per annum
equal to the rate at which the Agent determines that it obtained (or
could have obtained) overnight Federal funds to cover such amount
for each such day during such period, provided that any such payment
by the Borrower of such Bank's ratable share and interest thereon
17
shall be without prejudice to any rights that the Borrower may have
against such Bank. If the Agent does not exercise its option to
advance funds for the account of such Bank, it shall forthwith
notify the Borrower of such decision.
(d) If any Bank makes a new Loan hereunder on a day on which
the Borrower is to repay all or any part of an outstanding Loan from
such Bank, such Bank shall apply the proceeds of its new Loan to
make such repayment and only an amount equal to the difference (if
any) between the amount being borrowed and the amount being repaid
shall be made available by such Bank to the Agent as provided in
paragraph (c) of this Section, or remitted by the Borrower to the
Agent as provided in Section 2.11, as the case may be.
(e) Notwithstanding anything to the contrary contained in this
Agreement, no Euro-Dollar Borrowing may be made if there shall have
occurred a Default or an Event of Default, which Default or Event of
Default shall not have been cured or waived.
(f) In the event that a Notice of Borrowing fails to specify
whether the Loans comprising such Borrowing are to be Base Rate
Loans or Euro-Dollar Loans, such Loans shall be made as Base Rate
Loans. If the Borrower is otherwise entitled under this Agreement
to repay any Loans maturing at the end of an Interest Period
applicable thereto with the proceeds of a new Borrowing, and the
Borrower fails to repay such Loans using its own moneys and fails to
give a Notice of Borrowing in connection with such new Borrowing, a
new Borrowing shall be deemed to be made on the date such Loans
mature in an amount equal to the principal amount of the Loans so
maturing, and the Loans comprising such new Borrowing shall be Base
Rate Loans.
(g) Notwithstanding anything to the contrary contained
herein, there shall not be more than 6 Euro-Dollar Borrowings
outstanding at any given time.
SECTION 2.03. Notes. (a) The Loans of each Bank shall be
evidenced by a single Note payable to the order of such Bank for the
account of its Lending Office in an amount equal to the original
principal amount of such Bank's Commitment.
(b) Upon receipt of each Bank's Note pursuant to Section 3.01,
the Agent shall deliver such Note to such Bank. Each Bank shall
record, and prior to any transfer of its Note shall endorse on the
schedule forming a part thereof appropriate notations to evidence
the date, amount and maturity of each Loan made by it, the date and
amount of each payment of principal made by the Borrower with
respect thereto and whether such Loan is a Base Rate Loan or
18
Euro-Dollar Loan, and such schedule shall constitute rebuttable
presumptive evidence of the principal amount owing and unpaid on
such Bank's Note; provided that the failure of any Bank to make any
such recordation or endorsement shall not affect the obligation of
the Borrower hereunder or under the Notes or the ability of any Bank
to assign its Notes. Each Bank is hereby irrevocably authorized by
the Borrower so to endorse its Notes and to attach to and make a
part of any Note a continuation of any such schedule as and when
required.
SECTION 2.04. Maturity of Loans. Each Loan included in any
Borrowing shall mature, and the principal amount thereof shall be
due and payable, on the last day of the Interest Period applicable
to such Borrowing. The entire outstanding principal balance of the
Loans, together with all accrued but unpaid interest thereon, shall
be payable on the Termination Date.
SECTION 2.05. Interest Rates. (a) "Applicable Margin" means
(i) for any Base Rate Loan, 0.0%, and (ii) for any Euro-Dollar Loan,
(x) if the Debt to Cash Flow Ratio is less than or equal to 2.50 to
1.00, 1.50%, (y) if the Debt to Cash Flow Ratio is greater than 2.50
to 1.00 but less than or equal to 3.50 to 1.00, 1.875%, and (z) if
the Debt to Cash Flow Ratio is greater than 3.50 to 1.00, 2.25%.
In determining interest for purposes of this Section 2.05 and fees
for purposes of Section 2.06(a), the Borrower and the Banks shall
refer to the Borrower's most recent consolidated quarterly and
annual (as the case may be) financial statements referred to in
Section 4.04(a) or delivered pursuant to Section 5.01(a) or (b), as
the case may be. If such financial statements require a change in
interest pursuant to this Section 2.05 or fees pursuant to Section
2.06(a), the Borrower shall deliver to the Agent, along with such
financial statements, a notice to that effect, which notice shall
set forth in reasonable detail the calculations establishing the
required change. The date of delivery of such financial statements
and notice is the "Performance Pricing Determination Date." Any
such required change in interest and fees shall become effective on
such Performance Pricing Determination Date, and shall be in effect
until the next Performance Pricing Determination Date, provided,
however, that: (i) for Euro-Dollar Loans, changes in interest shall
only be effective for Interest Periods commencing on or after the
Performance Pricing Determination Date; and (ii) no fees or interest
shall be decreased pursuant to this Section 2.05 or Section 2.06(a)
if a Default is in existence on the Performance Pricing
Determination Date. Notwithstanding the foregoing, the Applicable
Margin for Euro-Dollar Loans shall be 1.50% per annum for the period
19
from the Closing Date through and including the first Performance
Pricing Determination Date occurring in calendar year 1997.
(b) Each Base Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is
made until it becomes due, at a rate per annum equal to the Base
Rate for such day plus the Applicable Margin. Such interest shall
be payable for each Interest Period on the last day thereof. Any
overdue principal of and, to the extent permitted by applicable law,
overdue interest on any Base Rate Loan shall bear interest, payable
on demand, for each day until paid at a rate per annum equal to the
Default Rate.
(c) Each Euro-Dollar Loan shall bear interest on the
outstanding principal amount thereof, for the Interest Period
applicable thereto, at a rate per annum equal to the sum of the
Applicable Margin plus the applicable Adjusted London Interbank
Offered Rate for such Interest Period. Such interest shall be
payable for each Interest Period on the last day thereof and, if
such Interest Period is longer than 3 months, at intervals of 3
months after the first day thereof. Any overdue principal of and,
to the extent permitted by law, overdue interest on any Euro-Dollar
Loan shall bear interest, payable on demand, for each day until paid
at a rate per annum equal to the Default Rate.
The "Adjusted London Interbank Offered Rate" applicable to any
Interest Period means a rate per annum equal to the quotient
obtained (rounded upwards, if necessary, to the next higher 1/100th
of 1%) by dividing (i) the applicable London Interbank Offered Rate
for such Interest Period by (ii) 1.00 minus the Euro-Dollar Reserve
Percentage.
The "London Interbank Offered Rate" applicable to any
Euro-Dollar Loan means for the Interest Period of such Euro-Dollar
Loan, the rate per annum determined on the basis of the offered rate
for deposits in Dollars of amounts equal or comparable to the
principal amount of such Euro-Dollar Loan offered for a term
comparable to such Interest Period, which rates appear on the
Reuters Screen LIBO Page as of 11:00 A.M., London time, 2
Euro-Dollar Business Days prior to the first day of such Interest
Period, provided that (i) if more than one such offered rate appears
on the Reuters Screen LIBO Page, the "London Interbank Offered Rate"
will be the arithmetic average (rounded upward, if necessary, to the
next higher 1/100th of 1%) of such offered rates; (ii) if no such
offered rates appear on such page, the "London Interbank Offered
Rate" for such Interest Period will be the arithmetic average
(rounded upward, if necessary, to the next higher 1/100th of 1%) of
rates quoted by not less than 2 major banks in New York City,
selected by the Agent, at approximately 10:00 A.M., New York City
20
time, 2 Euro-Dollar Business Days prior to the first day of such
Interest Period, for deposits in Dollars offered to leading European
banks for a period comparable to such Interest Period in an amount
comparable to the principal amount of such Euro-Dollar Loan.
"Euro-Dollar Reserve Percentage" means for any day that
percentage (expressed as a decimal) which is in effect on such day,
as prescribed by the Board of Governors of the Federal Reserve
System (or any successor) for determining the maximum reserve
requirement for a member bank of the Federal Reserve System in
respect of "Eurocurrency liabilities" (or in respect of any other
category of liabilities which includes deposits by reference to
which the interest rate on Euro-Dollar Loans is determined or any
category of extensions of credit or other assets which includes
loans by a non-United States office of any Bank to United States
residents). The Adjusted London Interbank Offered Rate shall be
adjusted automatically on and as of the effective date of any change
in the Euro-Dollar Reserve Percentage.
(e) The Agent shall determine each interest rate applicable to
the Loans hereunder. The Agent shall give prompt notice to the
Borrower and the Banks by telecopier of each rate of interest so
determined, and its determination thereof shall be conclusive in the
absence of manifest error.
(f) After the occurrence and during the continuance of a
Default, the principal amount of the Loans (and, to the extent
permitted by applicable law, all accrued interest thereon) may, at
the election of the Required Banks, bear interest at the Default
Rate.
SECTION 2.06. Fees. (a) The Borrower shall pay to the Agent
for the ratable account of each Bank, a commitment fee on the
average daily amount of such Bank's Unused Commitment calculated at
the rate of (x) if the Debt to Cash Flow Ratio is less than or equal
to 2.50 to 1.00, 0.25% per annum, (y) if the Debt to Cash Flow Ratio
is greater than 2.50 to 1.00 but less than or equal to 3.50 to 1.00,
0.30% per annum, and (z) if the Debt to Cash Flow Ratio is greater
than 3.50 to 1.00, 0.35% per annum. Such commitment fees shall
accrue from and including the Closing Date to but excluding the
Termination Date and shall be payable on each March 31, June 30,
September 30, December 31 and on the Termination Date. The Debt to
Cash Flow Ratio referred to in this Section 2.06(a) shall be
calculated in accordance with Section 2.05. Notwithstanding the
foregoing, the commitment fee shall be 0.25% per annum for the
period from the Closing Date through and including the first
Performance Pricing Determination Date occurring in calendar year
1997.
21
(b) On the Closing Date, the Borrower shall pay to the Agent
for the ratable benefit of each of the Banks a fully earned and non-
refundable upfront closing fee equal to the product of (x) 0.08%
times (y) the aggregate Commitments.
(c) The Borrower shall pay to the Agent, for the account and
sole benefit of the Agent, such fees and other amounts at such times
as set forth in the Agent's Letter Agreement.
SECTION 2.07. Optional Termination or Reduction of
Commitments. The Borrower may, upon at least 3 Domestic Business
Days' notice to the Agent, terminate at any time, or proportionately
reduce the Unused Commitments from time to time by an aggregate
amount of at least $3,000,000 or any larger multiple of $1,000,000.
If the Commitments are terminated in their entirety, all accrued
fees (as provided under Section 2.06) shall be due and payable on
the effective date of such termination.
SECTION 2.08. Mandatory Reduction and Termination of
Commitments. The Commitments shall terminate on the Termination
Date and any Loans then outstanding (together with accrued interest
thereon) shall be due and payable on such date.
SECTION 2.09. Optional Prepayments. (a) The Borrower may,
upon at least 1 Domestic Business Days' notice to the Agent, prepay
any Base Rate Borrowing in whole at any time, or from time to time
in part in amounts aggregating at least $1,000,000, by paying the
principal amount to be prepaid together with accrued interest
thereon to the date of prepayment. Each such optional prepayment
shall be applied to prepay ratably the Base Rate Loans of the
several Banks included in such Base Rate Borrowing.
(b) Except as provided in Section 8.02, the Borrower may not
prepay all or any portion of the principal amount of any Euro-Dollar
Loan prior to the maturity thereof.
(c) Upon receipt of a notice of prepayment pursuant to this
Section 2.09, the Agent shall promptly notify each Bank of the
contents thereof and of such Bank's ratable share of such prepayment
and such notice shall not thereafter be revocable by the Borrower.
SECTION 2.10. Mandatory Prepayments. On each date on which
the Commitments are reduced pursuant to Section 2.07 or Section
2.08, the Borrower shall repay or prepay such principal amount of
the outstanding Loans, if any (together with interest accrued
thereon), as may be necessary so that after such payment the
aggregate unpaid principal amount of the Loans does not exceed the
aggregate amount of the Commitments as then reduced.
22
SECTION 2.11. General Provisions as to Payments. (a) The
Borrower shall make each payment of principal of, and interest on,
the Loans and of fees hereunder, not later than 11:00 A.M. (Atlanta,
Georgia time) on the date when due, in Federal or other funds
immediately available in Atlanta, Georgia, to the Agent at its
address referred to in Section 9.01. The Agent will promptly
distribute to each Bank its ratable share of each such payment
received by the Agent for the account of the Banks.
(b) Whenever any payment of principal of, or interest on, the
Base Rate Loans or of fees hereunder shall be due on a day which is
not a Domestic Business Day, the date for payment thereof shall be
extended to the next succeeding Domestic Business Day. Whenever any
payment of principal of or interest on, the Euro-Dollar Loans shall
be due on a day which is not a Euro-Dollar Business Day, the date
for payment thereof shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls
in another calendar month, in which case the date for payment
thereof shall be the next preceding Euro-Dollar Business Day.
(c) All payments of principal, interest and fees and all other
amounts to be made by the Borrower pursuant to this Agreement with
respect to any Loan or fee relating thereto shall be paid without
deduction for, and free from, any tax, imposts, levies, duties,
deductions, or withholdings of any nature now or at anytime
hereafter imposed by any governmental authority or by any taxing
authority thereof or therein excluding in the case of each Bank,
taxes imposed on or measured by its net income, and franchise taxes
imposed on it, by the jurisdiction under the laws of which such Bank
(as the case may be) is organized or any political subdivision
thereof and, in the case of each Bank, taxes imposed on its income,
and franchise taxes imposed on it, by the jurisdiction of such
Bank's applicable Lending Office or any political subdivision
thereof (all such non-excluded taxes, imposts, levies, duties,
deductions or withholdings of any nature being "Taxes"). In the
event that the Borrower is required by applicable law to make any
such withholding or deduction of Taxes with respect to any Loan or
fee or other amount, the Borrower shall pay such deduction or
withholding to the applicable taxing authority, shall promptly
furnish to any Bank in respect of which such deduction or
withholding is made all receipts and other documents evidencing such
payment and shall pay to such Bank additional amounts as may be
necessary in order that the amount received by such Bank after the
required withholding or other payment shall equal the amount such
Bank would have received had no such withholding or other payment
been made. If no withholding or deduction of Taxes are payable in
respect to any Loan or fee relating thereto, the Borrower shall
furnish any, at such Bank's request, a certificate from each
23
applicable taxing authority or an opinion of counsel acceptable to
such, in either case stating that such payments are exempt from or
not subject to withholding or deduction of Taxes. If the Borrower
fails to provide such original or certified copy of a receipt
evidencing payment of Taxes or certificate(s) or opinion of counsel
of exemption, the Borrower hereby agrees to compensate such Bank
for, and indemnify them with respect to, the tax consequences of the
Borrower's failure to provide evidence of tax payments or tax
exemption.
Each Bank agrees, as soon as practicable after request by it of
a request by the Borrower to do so, to file all appropriate forms
and take other appropriate action to obtain a certificate or other
appropriate document from the appropriate governmental authority in
the jurisdiction imposing the relevant taxes, establishing that it
is entitled to receive payments of principal and interest under this
Agreement and the Notes without deduction and free from withholding
of any Taxes imposed by such jurisdiction; provided, that, if it is
unable, for any reason, to establish such exemption, or to file such
forms and, in any event, during such period of time as such request
for exemption is pending, the Borrower shall nonetheless remain
obligated under the terms of the immediately preceding paragraph.
In the event any Bank receives a refund of any Taxes paid by
the Borrower pursuant to this Section 2.11(c), it will pay to the
Borrower the amount of such refund promptly upon receipt thereof;
provided, however, if at any time thereafter it is required to
return such refund, the Borrower shall promptly repay to it the
amount of such refund.
Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower
and the Banks contained in this Section 2.11(c) shall be applicable
with respect to any Participant, Assignee or other Transferee, and
any calculations required by such provisions (i) shall be made based
upon the circumstances of such Participant, Assignee or other
Transferee, and (ii) constitute a continuing agreement and shall
survive the termination of this Agreement and the payment in full or
cancellation of the Notes.
SECTION 2.12. Computation of Interest and Fees. Interest on
the Loans shall be computed on the basis of a year of 360 days and
paid for the actual number of days elapsed, calculated as to each
Interest Period from and including the first day thereof to but
excluding the last day thereof. Commitment fees and any other fees
payable hereunder shall be computed on the basis of a year of 360
days and paid for the actual number of days elapsed (including the
first day but excluding the last day).
24
ARTICLE III
CONDITIONS TO BORROWINGS
SECTION 3.01. Conditions to First Borrowing. The obligation
of each Bank to make a Loan on the occasion of the first Borrowing
is subject to the satisfaction of the conditions set forth in
Section 3.02 and receipt by the Agent of the following (in
sufficient number of counterparts (except as to the Notes) for
delivery of a counterpart to each Bank and retention of one
counterpart by the Agent):
(a) from each of the parties hereto of a duly executed
counterpart of this Agreement signed by such party;
(b) a duly executed Note for the account of each Bank
complying with the provisions of Section 2.03;
(c) an opinion letter (together with any opinions of local
counsel relied on therein) of Xxxxxxxxxx & Xxxxxxxx, counsel for the
Borrower, dated as of the Closing Date, substantially in the form of
Exhibit B and covering such additional matters relating to the
transactions contemplated hereby as the Agent or any Bank may
reasonably request;
(d) an opinion of Xxxxx, Day, Xxxxxx & Xxxxx, special counsel
for the Agent, dated as of the Closing Date, substantially in the
form of Exhibit C and covering such additional matters relating to
the transactions contemplated hereby as the Agent may reasonably
request;
(e) a certificate (the "Closing Certificate") substantially in
the form of Exhibit G), dated as of the Closing Date, signed by a
principal financial officer of the Borrower, to the effect that (i)
no Default has occurred and is continuing on the date of the first
Borrowing and (ii) the representations and warranties of the
Borrower contained in Article IV are true on and as of the date of
the first Borrowing hereunder;
(f) all documents which the Agent or any Bank may reasonably
request relating to the existence of the Borrower, the corporate
authority for and the validity of this Agreement and the Notes, and
any other matters relevant hereto, all in form and substance
satisfactory to the Agent, including, without limitation, a
certificate of incumbency of the Borrower, signed by the Secretary
or an Assistant Secretary of the Borrower, certifying as to the
names, true signatures and incumbency of the officer or officers of
the Borrower authorized to execute and deliver the Loan Documents,
and certified copies of the following items: (i) the Borrower's
Certificate of Incorporation, (ii) the Borrower's Bylaws, (iii) a
25
certificate of the Secretary of State of the State of Georgia as to
the valid existence of the Borrower as a Georgia corporation, and
(iv) the action taken by the Board of Directors of the Borrower
authorizing the Borrower's execution, delivery and performance of
this Agreement, the Notes and the other Loan Documents to which the
Borrower is a party;
(g) a Notice of Borrowing; and
(h) a letter from the Borrower to Wachovia terminating the
commitments under the Credit Agreement dated November 15, 1994.
SECTION 3.02. Conditions to All Borrowings. The obligation of
each Bank to make a Loan on the occasion of each Borrowing is
subject to the satisfaction of the following conditions:
(a) receipt by the Agent of a Notice of Borrowing;
(b) the fact that, immediately before and after such
Borrowing, no Default shall have occurred and be continuing;
(c) the fact that the representations and warranties of the
Borrower contained in Article IV of this Agreement shall be true on
and as of the date of such Borrowing; and
(d) the fact that, immediately after such Borrowing, the
aggregate outstanding principal amount of the Loans of each Bank
will not exceed the amount of its Commitment.
Each Borrowing hereunder shall be deemed to be a representation and
warranty by the Borrower on the date of such Borrowing as to the
truth and accuracy of the facts specified in paragraphs (b), (c) and
(d) of this Section.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that:
SECTION 4.01. Corporate Existence and Power. The Borrower is
a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation. The
Borrower is duly qualified to transact business in every
jurisdiction where, by the nature of its business, such
qualification is necessary, and has all corporate powers and all
governmental licenses, authorizations, consents and approvals
required to carry on its business as now conducted, except, in each
case to the extent that the Borrower's failure to possess any of the
26
foregoing could not reasonably be expected to have or cause a
Material Adverse Effect.
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by the
Borrower of this Agreement, the Notes and the other Loan Documents
(i) are within the Borrower's corporate powers, (ii) have been duly
authorized by all necessary corporate action, (iii) require no
action by or in respect of or filing with, any governmental body,
agency or official, except for those filings which have been
obtained, are not yet due, or the failure to make could not
reasonably be expected to have or cause a Material Adverse Effect,
(iv) do not contravene, or constitute a default under, any provision
of applicable law or regulation or of the certificate of
incorporation or by-laws of the Borrower or of any agreement,
judgment, injunction, order, decree or other instrument binding upon
the Borrower or any of its Subsidiaries, and (v) do not result in
the creation or imposition of any Lien on any asset of the Borrower
or any of its Subsidiaries.
SECTION 4.03. Binding Effect. This Agreement constitutes a
valid and binding agreement of the Borrower enforceable in
accordance with its terms, and the Notes and the other Loan
Documents, when executed and delivered in accordance with this
Agreement, will constitute valid and binding obligations of the
Borrower enforceable in accordance with their respective terms,
provided that the enforceability hereof and thereof is subject in
each case to general principles of equity and to bankruptcy,
insolvency and similar laws affecting the enforcement of creditors'
rights generally.
SECTION 4.04. Financial Information. (a) The consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries as
of December 28, 1996 and the related consolidated statements of
income, shareholders' equity and cash flows (deficit) for the Fiscal
Year then ended, reported on by Xxxxxx Xxxxxxxx LLP, copies of which
have been delivered to each of the Banks, and the unaudited
consolidated financial statements of the Borrower for the interim
period ended March 29, 1997 copies of which have been delivered to
each of the Banks, fairly present, in conformity with GAAP, the
consolidated financial position of the Borrower and its Consolidated
Subsidiaries as of such dates and their consolidated results of
operations and cash flows for such periods stated, except, in the
case of the March 29, 1997 interim financial statements, the
omission of notes thereto and the effect of normally recurring year-
end adjustments.
(b) Since December 31, 1996 there has been no event, act,
condition or occurrence having a Material Adverse Effect.
27
SECTION 4.05. No Litigation. There is no action, suit or
proceeding pending, or to the knowledge of the Borrower threatened,
against or affecting the Borrower or any of its Subsidiaries before
any court or arbitrator or any governmental body, agency or official
which could reasonably be expected to have or cause a Material
Adverse Effect.
SECTION 4.06. Compliance with ERISA. (a) The Borrower and
each member of the Controlled Group have fulfilled their obligations
under the minimum funding standards of ERISA and the Code with
respect to each Plan and are in compliance in all material respects
with the presently applicable provisions of ERISA and the Code, and
have not incurred any liability to the PBGC or a Plan under Title IV
of ERISA.
(b) Neither the Borrower nor any member of the Controlled
Group is or ever has been obligated to contribute to any
Multiemployer Plan.
SECTION 4.07. Compliance with Laws; Payment of Taxes. The
Borrower and its Subsidiaries are in compliance with all applicable
laws, regulations and similar requirements of governmental
authorities, except where such compliance is being contested in good
faith through appropriate proceedings or where the failure to be in
such compliance could not reasonably be expected to have or cause a
Material Adverse Effect. There have been filed on behalf of the
Borrower and its Subsidiaries all Federal, state and local income,
excise, property and other tax returns which are required to be
filed by them and all taxes due pursuant to such returns or pursuant
to any assessment received by or on behalf of the Borrower or any
Subsidiary have been paid except for taxes (i) being contested in
good faith by appropriate proceedings and for which adequate
reserves have been made or (ii) for which the failure to pay could
not reasonably be expected to have or cause a Material Adverse
Effect. The charges, accruals and reserves on the books of the
Borrower and its Subsidiaries in respect of taxes or other
governmental charges are, in the opinion of the Borrower, adequate.
SECTION 4.08. Subsidiaries. Each of the Borrower's
Subsidiaries is a corporation duly organized, validly existing and
in good standing under the laws of its jurisdiction of
incorporation, is duly qualified to transact business in every
jurisdiction where, by the nature of its business, such
qualification is necessary, and has all corporate powers and all
governmental licenses, authorizations, consents and approvals
required to carry on its business as now conducted, except, in each
case to the extent that such Subsidiary's failure to possess any of
the foregoing could not reasonably be expected to have or cause a
Material Adverse Effect. The Borrower has no Subsidiaries except
28
for those Subsidiaries listed on Schedule 4.08, which accurately
sets forth each such Subsidiary's complete name and jurisdiction of
incorporation. The Borrower and its Material Subsidiaries do (and
shall at all times after the Closing Date) collectively account for
at least (i) 90.0% of Consolidated Operating Profits and (ii) 90.0%
of Consolidated Total Assets.
SECTION 4.09. Investment Company Act. Neither the Borrower
nor any of its Subsidiaries is an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
SECTION 4.10. Public Utility Holding Company Act. Neither the
Borrower nor any of its Subsidiaries is a "holding company", or a
"subsidiary company" of a "holding company", or an "affiliate" of a
"holding company" or of a "subsidiary company" of a "holding
company", as such terms are defined in the Public Utility Holding
Company Act of 1935, as amended.
SECTION 4.11. Ownership of Property; Liens. Each of the
Borrower and its Consolidated Subsidiaries has title to its
properties sufficient for the conduct of its business, and none of
such property is subject to any Lien except as permitted in Section
5.10.
SECTION 4.12. No Default. Neither the Borrower nor any of its
Consolidated Subsidiaries is in default under or with respect to any
agreement, instrument or undertaking to which it is a party or by
which it or any of its property is bound which could have or cause a
Material Adverse Effect. No Default or Event of Default has
occurred and is continuing.
SECTION 4.13. Full Disclosure. All information heretofore
furnished by the Borrower to the Agent or any Bank for purposes of
or in connection with this Agreement or any transaction contemplated
hereby is, and all such information hereafter furnished by the
Borrower to the Agent or any Bank will be, true, accurate and
complete in every material respect or based on reasonable estimates
on the date as of which such information is stated or certified.
The Borrower has disclosed to the Banks in writing any and all facts
which could have or cause a Material Adverse Effect.
SECTION 4.14. Environmental Matters. (a) Neither the Borrower
nor any Subsidiary is subject to any Environmental Liability which
could have or cause a Material Adverse Effect and neither the
Borrower nor any Subsidiary has been designated as a potentially
responsible party under CERCLA or under any state statute similar to
CERCLA. None of the Properties has been identified on any current
or proposed (i) National Priorities List under 40 C.F.R. Section 300, (ii)
29
CERCLIS list or (iii) any list arising from a state statute similar
to CERCLA.
(b) No Hazardous Materials have been or are being used,
produced, manufactured, processed, treated, recycled, generated,
stored, disposed of, managed or otherwise handled at, or shipped or
transported to or from the Properties or are otherwise present at,
on, in or under the Properties, or, to the best of the knowledge of
the Borrower, at or from any adjacent site or facility, except for
Hazardous Materials, such as cleaning solvents, pesticides and other
materials used, produced, manufactured, processed, treated,
recycled, generated, stored, disposed of, managed, or otherwise
handled in minimal amounts in the ordinary course of business in
compliance in all material respects with all applicable
Environmental Requirements.
(c) The Borrower and each of its Subsidiaries has procured all
Environmental Authorizations necessary for the conduct of its
business, and is in compliance with all Environmental Requirements
in connection with the operation of the Properties and the
Borrower's and each of its Subsidiary's respective businesses,
except where the failure to procure or comply with any of the
foregoing could not reasonably be expected to have or cause a
Material Adverse Effect.
SECTION 4.15. Capital Stock. All Capital Stock, debentures,
bonds, notes and all other securities of the Borrower and its
Subsidiaries presently issued and outstanding are validly and
properly issued in accordance with all applicable laws, including,
but not limited to, the "Blue Sky" laws of all applicable states and
the federal securities laws. The issued shares of Capital Stock of
the Borrower's Wholly Owned Subsidiaries are owned by the Borrower
free and clear of any Lien or adverse claim. At least a majority of
the issued shares of capital stock of each of the Borrower's other
Subsidiaries (other than Wholly Owned Subsidiaries) is owned by the
Borrower free and clear of any Lien or adverse claim, except for
rights of first refusal granted by any of such Subsidiaries to its
joint venture partner or joint venture partners with respect to the
Capital Stock of such Subsidiary.
SECTION 4.16. Margin Stock. Neither the Borrower nor any of
its Subsidiaries is engaged principally, or as one of its important
activities, in the business of purchasing or carrying any Margin
Stock, and no part of the proceeds of any Loan will be used to
purchase or carry any Margin Stock or to extend credit to others for
the purpose of purchasing or carrying any Margin Stock, or be used
for any purpose which violates, or which is inconsistent with, the
provisions of Regulation X.
30
SECTION 4.17. Insolvency. After giving effect to the
execution and delivery of the Loan Documents and the making of the
Loans under this Agreement, the Borrower will not be "insolvent,"
within the meaning of such term as used in O.C.G.A. Section 18-2-22 or
as defined in Section 101 of Title 11 of the United States Code or
Section 2 of the Uniform Fraudulent Transfer Act, or any other applicable
state law pertaining to fraudulent transfers, as each may be amended
from time to time, or be unable to pay its debts generally as such
debts become due, or have an unreasonably small capital to engage in
any business or transaction, whether current or contemplated.
ARTICLE V
COVENANTS
The Borrower agrees that, so long as any Bank has any
Commitment hereunder or any amount payable hereunder or under any
Note remains unpaid:
SECTION 5.01. Information. The Borrower will deliver to each
of the Banks:
(a) as soon as available and in any event within 90 days after
the end of each Fiscal Year, a consolidated balance sheet of the
Borrower and its Consolidated Subsidiaries as of the end of such
Fiscal Year and the related consolidated statements of income,
shareholders' equity and cash flows for such Fiscal Year, setting
forth in each case in comparative form the figures for the previous
fiscal year, all certified by Xxxxxx Xxxxxxxx LLP or other
independent public accountants of nationally recognized standing,
with such certification to be free of exceptions and qualifications
not reasonably acceptable to the Required Banks;
(b) as soon as available and in any event within 45 days after
the end of each of the first 3 Fiscal Quarters of each Fiscal Year,
a consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries as of the end of such Fiscal Quarter and the related
statement of income and statement of cash flows for such Fiscal
Quarter and for the portion of the Fiscal Year ended at the end of
such Fiscal Quarter, setting forth in each case in comparative form
the figures for the corresponding Fiscal Quarter and the
corresponding portion of the previous Fiscal Year, all certified
(subject to normal year-end adjustments) as to fairness of
presentation, GAAP and consistency by the chief financial officer or
the chief accounting officer of the Borrower;
31
(c) simultaneously with the delivery of each set of financial
statements referred to in paragraphs (a) and (b) above, a
certificate, substantially in the form of Exhibit F (a "Compliance
Certificate"), of the chief financial officer or the chief
accounting officer of the Borrower (i) setting forth in reasonable
detail the calculations required to establish whether the Borrower
was in compliance with the requirements of Sections 5.03 through
5.05, inclusive, Section 5.07, and Sections 5.24 and 5.25, on the
date of such financial statements and (ii) stating whether any
Default exists on the date of such certificate and, if any Default
then exists, setting forth the details thereof and the action which
the Borrower is taking or proposes to take with respect thereto;
(d) simultaneously with the delivery of each set of annual
financial statements referred to in paragraph (a) above, a statement
of the firm of independent public accountants which reported on such
statements to the effect that, during the normal course of their
audit, nothing has come to their attention to cause them to believe
that any Default existed on the date of such financial statements;
(e) within 5 Domestic Business Days after the Borrower becomes
aware of the occurrence of any Default, a certificate of the chief
financial officer or the chief accounting officer of the Borrower
setting forth the details thereof and the action which the Borrower
is taking or proposes to take with respect thereto;
(f) promptly upon the mailing thereof to the shareholders of
the Borrower generally, copies of all financial statements, reports
and proxy statements so mailed;
(g) promptly upon the filing thereof, copies of all
registration statements (other than the exhibits thereto and any
registration statements on Form S-8 or its equivalent) and annual,
quarterly or monthly reports which the Borrower shall have filed
with the Securities and Exchange Commission;
(h) if and when any member of the Controlled Group (i) gives
or is required to give notice to the PBGC of any "reportable event"
(as defined in Section 4043 of ERISA) with respect to any Plan which
might constitute grounds for a termination of such Plan under Title
IV of ERISA, or knows that the plan administrator of any Plan has
given or is required to give notice of any such reportable event, a
copy of the notice of such reportable event given or required to be
given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA, a copy of such notice;
32
or (iii) receives notice from the PBGC under Title IV of ERISA of an
intent to terminate or appoint a trustee to administer any Plan, a
copy of such notice;
(i) promptly following its receipt thereof, and
contemporaneously upon its delivery thereof, copies of any and all
written correspondence relating to any breach or default under, or
termination of, the Wal-Mart Agreement; and
(j) from time to time such additional information regarding
the financial position or business of the Borrower and its
Subsidiaries as the Agent, at the request of any Bank, may
reasonably request.
SECTION 5.02. Inspection of Property, Books and Records. The
Borrower will (i) keep, and cause each Material Subsidiary to keep,
proper books of record and account in which full, true and correct
entries in conformity with GAAP shall be made of all dealings and
transactions in relation to its business and activities; and (ii)
permit, and cause each Subsidiary to permit, representatives of any
Bank at such Bank's expense prior to the occurrence of a Default and
at the Borrower's expense after the occurrence of a Default to visit
and inspect any of their respective properties, to examine and make
abstracts from any of their respective books and records and to
discuss their respective affairs, finances and accounts with their
respective officers, employees and independent public accountants.
The Borrower agrees to cooperate and assist in such visits and
inspections, in each case at such reasonable times and as often as
may reasonably be desired; provided, that, prior to the occurrence
of a Default, reasonable notice will be provided to the Borrower by
a Bank prior to the exercise by such Bank of its inspection rights
under this Section 5.02(ii).
SECTION 5.03. Ratio of Consolidated Debt to Consolidated Cash
Flow. At the end of each Fiscal Quarter, commencing with the Fiscal
Quarter ending December 28, 1996, the ratio of Consolidated Debt for
the immediately preceding 4 Fiscal Quarters then ended to
Consolidated Cash Flow for the immediately preceding 4 Fiscal
Quarters then ended, shall be less than (i) for the period from the
Closing Date through and including the last day of the 2nd Fiscal
Quarter of the Borrower's 1997 Fiscal Year, 4.00 to 1.00, (ii) for
the period beginning with the first day of the 3rd Fiscal Quarter of
Borrower's 1997 Fiscal year through and including the last day of
the 3rd Fiscal Quarter of Borrower's 1998 Fiscal Year, 3.75 to 1.00,
and (iii) at all times thereafter, 3.50 to 1.00.
SECTION 5.04. Ratio of Consolidated Debt to Consolidated Total
Tangible Capital. The ratio of Consolidated Debt to Consolidated
Total Tangible Capital will not at any time exceed (i) for the
33
period from the Closing Date through and including the last day of
the 2nd Fiscal Quarter of the Borrower's 1997 Fiscal Year, 0.60 to
1.00, and (ii) at all times thereafter, 0.75 to 1.00.
SECTION 5.05. Minimum Consolidated Tangible Net Worth.
Consolidated Tangible Net Worth will at no time be less than
$20,000,000 as of December 28, 1996, plus the sum of (i) 25.0% of
the cumulative Reported Net Income of the Borrower and its
Consolidated Subsidiaries during each Fiscal Year, beginning
December 29, 1996, and (ii) 100% of the cumulative Net Proceeds of
Capital Stock received during any period after December 31, 1996,
calculated quarterly.
SECTION 5.06. Restricted Payments. The Borrower will not
declare or make any Restricted Payment after the Closing Date, if
the aggregate amount of such Restricted Payments would exceed 50.0%
of cumulative Consolidated Net Income for all fiscal periods after
December 31, 1993; provided that after giving effect to the payment
of any such Restricted Payments, the Borrower will be in full
compliance with all of the provisions of this Agreement.
SECTION 5.07. Consolidated Fixed Charges Coverage. At the end
of each Fiscal Quarter, commencing with the Fiscal Quarter ending
December 28, 1996 the ratio of Income Available for Consolidated
Fixed Charges for the immediately preceding 4 Fiscal Quarters then
ended to Consolidated Fixed Charges for the immediately preceding 4
Fiscal Quarters then ended, shall (i) for the period from the
Closing Date through and including the last day of the 2nd Fiscal
Quarter of the Borrower's 1997 Fiscal Year, be equal to or greater
than 1.10 to 1.00, (ii) for the period beginning with the first day
of the 3rd Fiscal Quarter of the Borrower's 1997 Fiscal Year through
and including the last day of the 3rd Fiscal Quarter of the
Borrower's 1998 Fiscal year, be greater than or equal to 1.15 to
1.00, and (iii) at all times thereafter, be greater than or equal to
1.20 to 1.00.
SECTION 5.08. Loans or Advances. Neither the Borrower nor any
of its Subsidiaries shall make loans or advances to any Person
except: (i) loans or advances to employees not exceeding $500,000 in
the aggregate principal amount outstanding at any time, in each case
made in the ordinary course of business and consistent with
practices existing on the Closing Date; (ii) deposits required by
government agencies or public utilities or in connection with bid or
performance bonds, (iii) deposits and advances required in
connection with the purchase of supplies, equipment or inventory,
(iv) loans and advances constituting Investments permitted by
34
Section 5.09, and (v) other loans and advances, in each case made in
the ordinary course of business and consistent with the Borrower's
past practices, not exceeding $1,000,000 in aggregate principal
amount outstanding at any time; provided, that, after giving effect
to the making of any loans, advances or deposits permitted by this
Section, the Borrower will be in full compliance with all the
provisions of this Agreement.
SECTION 5.09. Investments; Acquisitions. (a) Neither the
Borrower nor any of its Subsidiaries shall make Investments in any
Person except as permitted by Sections 5.08 and 5.09(b) and except
Investments in (i) direct obligations of the United States
Government maturing within one year, (ii) certificates of deposit
issued by a commercial bank whose credit is satisfactory to the
Agent, (iii) commercial paper rated A1 or the equivalent thereof by
Standard & Poor's Corporation or P1 or the equivalent thereof by
Xxxxx'x Investors Service, Inc. and in either case maturing within 6
months after the date of acquisition, (iv) tender bonds the payment
of the principal of and interest on which is fully supported by a
letter of credit issued by a United States bank whose long-term
certificates of deposit are rated at least AA or the equivalent
thereof by Standard & Poor's Corporation and Aa or the equivalent
thereof by Xxxxx'x Investors Service, Inc., (v) Domestic
Subsidiaries which are Wholly-Owned Subsidiaries and investments by
Subsidiaries in the Borrower, (vi) capital stock or partnership
interests of Persons who constitute joint ventures between the
Borrower and/or any Subsidiary and other Persons, which joint
ventures will at all times be engaged in a business that is
substantially related to the existing businesses of the Borrower and
its Subsidiaries, and (vii) other Investments not to exceed
$4,000,000 at any time.
(b) Neither the Borrower nor any of its Subsidiaries shall make
any Acquisitions except with respect to (i) Optical Retailer (the
term "Optical Retailer" having the meaning set forth in that certain
letter between Borrower and Agent dated July 15, 1997) locations for
an aggregate purchase price (including debt assumed) not to exceed,
unless the Borrower obtains the consent of two-thirds of the Banks,
$40,000,000, (ii) Acquisitions with respect to non-Optical Retailer
locations during the period from the Closing Date through and
including July 15, 1998, provided that, unless the Borrower obtains
the consent of two-thirds of the Banks, the aggregate purchase price
(including debt assumed) for any or all such Acquisitions does not
exceed $27,500,000, (iii) Acquisitions during the period from July
15, 1998 through and including July 15, 1999, provided that, unless
the Borrower obtains the consent of two-thirds of the Banks, the sum
of the aggregate purchase price (including debt assumed) of such
non-Optical Retailer Acquisitions plus the aggregate purchase price
(including debt assumed) for Acquisitions permitted and made under
clause (ii) immediately preceding does not exceed $40,000,000, (iv)
35
in addition to any Acquisitions permitted in the immediately
preceding clauses (i), (ii) and (iii), Acquisitions during the
period from the Closing Date through and including July 15, 1998
provided that the aggregate purchase price (including debt assumed)
for such Acquisitions does not exceed $3,000,000, (v) in addition to
any Acquisitions permitted in the immediately preceding clauses (i),
(ii), (iii) and (iv), Acquisitions during the period from the July
15, 1998 through and including July 15, 1999 provided that the
aggregate purchase price (including debt assumed) for such
Acquisitions does not exceed $3,000,000, and (vi) in addition to any
Acquisitions permitted in the immediately preceding clauses (i),
(ii), (iii), (iv) and (v), Acquisitions relating to the purchase or
other acquisition by the Borrower or any Subsidiary of additional
business locations in stores owned by Wal-Mart or any of its
Subsidiaries.
Provided, however, in no event shall the Borrower or any Subsidiary
make any non Optical Retailer Acquisition or series of related non
Optical Retailer Acquisitions (A) with a total purchase price
(including debt assumed) greater than $1,000,000, unless the
Borrower, has reasonably and in good faith, certified to the Agent
and Banks in writing, accompanied by Borrower certified pro forma
covenant calculations, pro forma balance sheets, income and cash
flow statements, that, without taking into account any expense
savings due to the integration of an Acquisition in the first year
following the date of such Acquisition and demonstrating any
projected losses of such Acquisition and in the case of any expense
savings in the second or third year following the date of such
Acquisition, setting forth in detail only those expense savings
based on reasonable business assumptions, the Borrower and
Subsidiaries would be in compliance with the terms and conditions of
this Agreement for a period of 3 years, or (B) during the existence
of any Event of Default. Upon the reasonable request of the Agent
and the Banks, Borrower shall provide additional information and/or
documentation in support of such covenant calculations.
SECTION 5.10. Negative Pledge. Neither the Borrower nor any
Consolidated Subsidiary will create, assume or suffer to exist any
Lien on any asset now owned or hereafter acquired by it, except:
(a) Liens existing on the date of this Agreement securing Debt
outstanding on the date of this Agreement in an aggregate principal
amount not exceeding $2,000,000.00;
(b) any Lien existing on any asset of any corporation at the
time such corporation becomes a Consolidated Subsidiary and not
created in contemplation of such event;
36
(c) any Lien on any asset securing Debt incurred or assumed
for the purpose of financing all or any part of the cost of
acquiring or constructing such asset, provided that such Lien
attaches to such asset concurrently with or within 18 months after
the acquisition or completion of construction thereof, and,
provided, further, that the aggregate principal amount of all
outstanding Debt secured by such Liens shall not exceed $5,000,000;
(d) any Lien on any asset of any corporation existing at the
time such corporation is merged or consolidated with or into the
Borrower or a Consolidated Subsidiary and not created in
contemplation of such event;
(e) any Lien existing on any asset prior to the acquisition
thereof by the Borrower or a Consolidated Subsidiary and not created
in contemplation of such acquisition;
(f) Liens securing Debt owing by any Subsidiary to the
Borrower;
(g) any Lien arising out of the refinancing, extension,
renewal or refunding of any Debt secured by any Lien permitted by
any of the foregoing paragraphs of this Section, provided that (i)
such Debt is not secured by any additional assets, and (ii) the
amount of such Debt secured by any such Lien is not increased;
(h) Liens incidental to the conduct of its business or the
ownership of its assets which (i) do not secure Debt and (ii) do not
in the aggregate materially detract from the value of its assets or
materially impair the use thereof in the operation of its business;
(i) Liens upon assets sold to Borrower and financed by the
seller of such assets, which seller obtains a Lien in the assets
sold; provided, that, the aggregate principal amount of all
outstanding Debt secured by such Liens shall not exceed $5,000,000;
(j) Liens on the assets of Subsidiaries of the Borrower which
are health maintenance organizations, in an aggregate amount not
exceeding $1,000,000;
(k) any Lien on Margin Stock; and
(l) Inchoate liens arising under ERISA to secure current
service pension liabilities as they are incurred under the
provisions of Plans from time to time in effect.
37
Provided Liens permitted by the foregoing paragraphs (a) through (l)
shall at no time secure Debt in an aggregate amount greater than
10.0% of Consolidated Tangible Net Worth.
SECTION 5.11. Maintenance of Existence. The Borrower shall,
and shall cause each Material Subsidiary to, maintain its corporate
existence and carry on its business in substantially the same manner
and in substantially the same fields as such business is now carried
on and maintained; provided, however, that any of Borrower's
Subsidiaries may carry on its business in the form of a joint
venture with any Person or Persons as joint venture partners.
SECTION 5.12. Dissolution. Neither the Borrower nor any of
its Material Subsidiaries shall suffer or permit dissolution or
liquidation either in whole or in part or redeem or retire any
shares of its own stock having a market value in excess of $500,000
or that of any Material Subsidiary, except through corporate
reorganization to the extent permitted by Section 5.13.
SECTION 5.13. Consolidations, Mergers and Sales of Assets.
The Borrower will not, nor will it permit any Material Subsidiary
to, consolidate or merge with or into, or sell, lease or otherwise
transfer all or any substantial part of its assets to, any other
Person, or discontinue or eliminate any material business line or
segment, provided that (a) the Borrower may merge with another
Person if (i) such Person was organized under the laws of the United
States of America or one of its states, (ii) the Borrower is the
corporation surviving such merger and (iii) immediately after giving
effect to such merger, no Default shall have occurred and be
continuing, (b) Subsidiaries of the Borrower may merge with one
another, and (c) the foregoing limitation on the sale, lease or
other transfer of assets and on the discontinuation or elimination
of a business line or segment shall not prohibit, either (i) during
any Fiscal Quarter, a transfer of assets or the discontinuance or
elimination of a business line or segment (in a single transaction
or in a series of related transactions) unless the aggregate assets
to be so transferred or utilized in a business line or segment to be
so discontinued, when combined with all other assets transferred,
and all other assets utilized in all other business lines or
segments discontinued, during such Fiscal Quarter and the
immediately preceding 7 Fiscal Quarters, either (x) constituted more
than 20% of Consolidated Total Assets at the end of the eighth
Fiscal Quarter immediately preceding such Fiscal Quarter, or (y)
contributed more than 20% of Consolidated Operating Profits during
the 8 Fiscal Quarters immediately preceding such Fiscal Quarter or
38
(ii) the consummation of joint ventures by the Borrower's Foreign
Subsidiaries on terms and conditions substantially consistent with
joint venture agreements already in effect.
SECTION 5.14. Use of Proceeds. The proceeds of the Loans
shall be used by the Borrower for general corporate purposes,
including, the refinancing of existing Debt, for financing of
equipment and fixtures for new stores, and for working capital. No
portion of the proceeds of the Loans will be used by the Borrower or
any Subsidiary (i) in connection with, whether directly or
indirectly, any hostile tender offer for, or other acquisition of,
stock of any corporation with a view towards obtaining control of
such other corporation, (ii) directly or indirectly, for the
purpose, whether immediate, incidental or ultimate, of purchasing or
carrying any Margin Stock, or (iii) for any purpose in violation of
any applicable law or regulation.
SECTION 5.15. Compliance with Laws; Payment of Taxes. The
Borrower will, and will cause each of its Subsidiaries and each
member of the Controlled Group to, comply in all material respects
with applicable laws (including but not limited to ERISA),
regulations and similar requirements of governmental authorities
(including but not limited to PBGC), except where the necessity of
such compliance either is being contested in good faith through
appropriate proceedings or could not reasonably be expected to have
or cause a Material Adverse Effect. The Borrower will, and will
cause each of its Subsidiaries to, pay promptly when due all taxes,
assessments, governmental charges, claims for labor, supplies, rent
and other obligations which, if unpaid, might become a lien against
the property of the Borrower or any Subsidiary, except liabilities
being contested in good faith and against which, if requested by the
Agent, the Borrower will set up reserves in accordance with GAAP.
SECTION 5.16. Insurance. The Borrower will maintain, and will
cause each of its Subsidiaries to maintain (either in the name of
the Borrower or in such Subsidiary's own name), with financially
sound and reputable insurance companies, insurance on all its
property in at least such amounts and against at least such risks as
are usually insured against in the same general area by companies of
established repute engaged in the same or similar business.
SECTION 5.17. Change in Fiscal Year. The Borrower will not
change its Fiscal Year without the consent of the Required Banks.
SECTION 5.18. Maintenance of Property. The Borrower shall,
and shall cause each Subsidiary to, maintain all of its properties
and assets in good condition, repair and working order, ordinary
wear and tear excepted.
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SECTION 5.19. Environmental Notices. The Borrower shall
furnish to the Banks and the Agent prompt written notice of all
Environmental Liabilities, pending, threatened or anticipated
Environmental Proceedings, Environmental Notices, Environmental
Judgments and Orders, and Environmental Releases at, on, in, under
or in any way affecting the Properties or any adjacent property, and
all facts, events, or conditions that could lead to any of the
foregoing; provided, that, the Borrower need not provide any such
notices if the subject matter of any of the foregoing could not
reasonably be expected to have or cause a Material Adverse Effect.
SECTION 5.20. Environmental Matters. The Borrower and its
Subsidiaries will not, and will not permit any Third Party to, use,
produce, manufacture, process, treat, recycle, generate, store,
dispose of, manage at, or otherwise handle, or ship or transport to
or from the Properties any Hazardous Materials except for Hazardous
Materials such as cleaning solvents, pesticides and other similar
materials used, produced, manufactured, processed, treated,
recycled, generated, stored, disposed, managed, or otherwise handled
in the ordinary course of business in compliance with all applicable
Environmental Requirements.
SECTION 5.21. Environmental Release. The Borrower agrees that
upon the occurrence of an Environmental Release at or on any of the
Properties it will act immediately to investigate the extent of, and
to take appropriate remedial action to eliminate, such Environmental
Release, whether or not ordered or otherwise directed to do so by
any Environmental Authority.
SECTION 5.22. Transactions with Affiliates. Neither the
Borrower nor any of its Subsidiaries shall enter into, or be a party
to, any transaction with any Affiliate of the Borrower or such
Subsidiary (which Affiliate is not the Borrower or a Wholly Owned
Subsidiary), except as permitted by law and in the ordinary course
of business and pursuant to reasonable terms which are no less
favorable to Borrower or such Subsidiary than would be obtained in a
comparable arm's length transaction with a Person which is not an
Affiliate.
SECTION 5.23. Change of Control. The Borrower shall not
permit a Change of Control to occur.
SECTION 5.24. Debt of Subsidiaries. The Borrower shall not
permit any Subsidiary to incur any Debt except for (i) Debt owing to
the Borrower, and (ii) other Debt which shall not exceed in the
aggregate for all Subsidiaries an amount in excess of $5,000,000.00.
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SECTION 5.25. Senior Debt. The Borrower shall not permit the
aggregate outstanding principal amount of Senior Debt (other than
Senior Debt under this Agreement) to exceed $10,000,000.00 at any
time.
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the
following events ("Events of Default") shall have occurred and be
continuing:
(a) the Borrower shall fail to pay when due any principal of
or interest on any Loan, or shall fail to pay any fee or other
amount payable hereunder within 5 Domestic Business Days after such
fee or other amount becomes due; or
(b) the Borrower shall fail to observe or perform any covenant
contained in Sections 5.02(ii), 5.03 to 5.14, inclusive, Section
5.17, 5.23, or 5.24; or
(c) the Borrower shall fail to observe or perform any covenant
or agreement contained or incorporated by reference in this
Agreement (other than those covered by paragraph (a) or (b) above)
and such failure shall not have been cured within 30 days after the
earlier to occur of (i) written notice thereof has been given to the
Borrower by the Agent at the request of any Bank or (ii) any of the
Borrower's (x) officers or (y) other employees having responsibility
for the administration of this Agreement, otherwise become aware of
any such failure; or
(d) any representation, warranty, certification or statement
made by the Borrower in Article IV of this Agreement or in any
certificate, financial statement or other document delivered
pursuant to this Agreement shall prove to have been incorrect or
misleading in any material respect when made (or deemed made); or
(e) the Borrower or any Subsidiary shall fail to make any
payment in respect of Debt outstanding in an aggregate principal
amount in excess of $1,000,000 (other than the Notes) when due or
within any applicable grace period; or
(f) any event or condition shall occur which results in the
acceleration of the maturity of Debt outstanding in an aggregate
principal amount in excess of $1,000,000 of the Borrower or any
Subsidiary (including, without limitation, any required mandatory
prepayment or "put" of such Debt to the Borrower or any Subsidiary)
or enables (or, with the giving of notice or lapse of time or both,
41
would enable) the holders of such Debt or commitment or any Person
acting on such holders' behalf to accelerate the maturity thereof or
terminate any such commitment (including, without limitation, any
required mandatory prepayment or "put" of such Debt to the Borrower
or any Subsidiary); or
(g) the Borrower or any Subsidiary shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or
other relief with respect to itself or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such
relief or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced
against it, or shall make a general assignment for the benefit of
creditors, or shall fail generally to pay its debts as they become
due, or shall take any corporate action to authorize any of the
foregoing; or
(h) an involuntary case or other proceeding shall be commenced
against the Borrower or any Subsidiary seeking liquidation,
reorganization or other relief with respect to it or its debts under
any bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other
proceeding shall remain undismissed and unstayed for a period of 60
days; or an order for relief shall be entered against the Borrower
or any Subsidiary under the federal bankruptcy laws as now or
hereafter in effect; or
(i) the Borrower or any member of the Controlled Group shall
fail to pay when due any material amount which it shall have become
liable to pay to the PBGC or to a Plan under Title IV of ERISA; or
notice of intent to terminate a Plan or Plans shall be filed under
Title IV of ERISA by the Borrower, any member of the Controlled
Group, any plan administrator or any combination of the foregoing;
or the PBGC shall institute proceedings under Title IV of ERISA to
terminate or to cause a trustee to be appointed to administer any
such Plan or Plans or a proceeding shall be instituted by a
fiduciary of any such Plan or Plans to enforce Section 515 or
4219(c)(5) of ERISA and such proceeding shall not have been
dismissed within 30 days thereafter; or a condition shall exist by
reason of which the PBGC would be entitled to obtain a decree
adjudicating that any such Plan or Plans must be terminated; or
(j) one or more judgments or orders for the payment of money
in an aggregate amount in excess of $500,000 shall be rendered
42
against the Borrower or any Subsidiary and such judgment or order
shall continue unsatisfied and unstayed for a period of 30 days; or
(k) a federal tax lien shall be filed against the Borrower or
any Subsidiary under Section 6323 of the Code or a lien of the PBGC
shall be filed against the Borrower or any Subsidiary under Section
4068 of ERISA and in either case such lien shall remain undischarged
for a period of 25 days after the date of filing; or
(l) the occurrence of any event, act, occurrence, or condition
which the Required Banks determine either does or has a reasonable
probability of causing a Material Adverse Effect; or
(m) the Wal-Mart Agreement, or any material provision thereof,
shall at any time for any reason cease to be valid and binding on
any party thereto, or shall be declared to be null and void, or
shall be cancelled or terminated, or the validity or enforceability
thereof shall be contested by any party thereto, or any party
thereto shall deny that it has any further liability or obligation
thereunder, and the result of any of the foregoing is to,
significantly impair the Borrower's ability to continue to operate
under the Wal-Mart Agreement in accordance with its past practices;
or
(n) the Borrower shall default in the performance or
observance of any material agreement or covenant contained in the
Wal-Mart Agreement, and such default shall not be cured within the
applicable cure period, if any, provided for in the Wal-Mart
Agreement;
then, and in every such event, the Agent shall (i) if requested by
the Required Banks, by notice to the Borrower terminate the
Commitments and they shall thereupon terminate, and (ii) if
requested by the Required Banks, by notice to the Borrower declare
the Notes (together with accrued interest thereon) to be, and the
Notes shall thereupon become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of
which are hereby waived by the Borrower together with interest at
the Default Rate accruing on the principal amount thereof from and
after the date of such Event of Default; provided that if any Event
of Default specified in paragraph (g) or (h) above occurs with
respect to the Borrower, without any notice to the Borrower or any
other act by the Agent or the Banks, the Commitments shall thereupon
terminate and the Notes (together with accrued interest thereon)
shall become immediately due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby
waived by the Borrower together with interest thereon at the Default
Rate accruing on the principal amount thereof from and after the
43
date of such Event of Default. Notwithstanding the foregoing, the
Agent shall have available to it all other remedies at law or
equity, and shall exercise any one or all of them at the request of
the Required Banks.
SECTION 6.02. Notice of Default. The Agent shall give notice
to the Borrower of any Default under Section 6.01(c) promptly upon
being requested to do so by any Bank and shall thereupon notify all
the Banks thereof.
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment; Powers and Immunities. Each Bank
hereby irrevocably appoints and authorizes the Agent to act as its
agent hereunder and under the other Loan Documents with such powers
as are specifically delegated to the Agent by the terms hereof and
thereof, together with such other powers as are reasonably
incidental thereto. The Agent: (a) shall have no duties or
responsibilities except as expressly set forth in this Agreement and
the other Loan Documents, and shall not by reason of this Agreement
or any other Loan Document be a trustee for any Bank; (b) shall not
be responsible to the Banks for any recitals, statements,
representations or warranties contained in this Agreement or any
other Loan Document, or in any certificate or other document
referred to or provided for in, or received by any Bank under, this
Agreement or any other Loan Document, or for the validity,
effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document or any other document referred
to or provided for herein or therein or for any failure by the
Borrower to perform any of its obligations hereunder or thereunder;
(c) shall not be required to initiate or conduct any litigation or
collection proceedings hereunder or under any other Loan Document
except to the extent requested by the Required Banks, and then only
on terms and conditions satisfactory to the Agent, and (d) shall not
be responsible for any action taken or omitted to be taken by it
hereunder or under any other Loan Document or any other document or
instrument referred to or provided for herein or therein or in
connection herewith or therewith, except for its own gross
negligence or wilful misconduct. The Agent may employ agents and
attorneys-in-fact and shall not be responsible for the negligence or
misconduct of any such agents or attorneys-in-fact selected by it
with reasonable care. The provisions of this Article VII are solely
for the benefit of the Agent and the Banks, and the Borrower shall
not have any rights as a third party beneficiary of any of the
provisions hereof. In performing its functions and duties under
this Agreement and under the other Loan Documents, the Agent shall
44
act solely as agent of the Banks and does not assume and shall not
be deemed to have assumed any obligation towards or relationship of
agency or trust with or for the Borrower. The duties of the Agent
shall be ministerial and administrative in nature, and the Agent
shall not have by reason of this Agreement or any other Loan
Document a fiduciary relationship in respect of any Bank.
SECTION 7.02. Reliance by Agent. The Agent shall be entitled
to rely upon any certification, notice or other communication
(including any thereof by telephone, telefax, telegram or cable)
believed by it to be genuine and correct and to have been signed or
sent by or on behalf of the proper Person or Persons, and upon
advice and statements of legal counsel, independent accountants or
other experts selected by the Agent. As to any matters not
expressly provided for by this Agreement or any other Loan Document,
the Agent shall in all cases be fully protected in acting, or in
refraining from acting, hereunder and thereunder in accordance with
instructions signed by the Required Banks, and such instructions of
the Required Banks in any action taken or failure to act pursuant
thereto shall be binding on all of the Banks.
SECTION 7.03. Defaults. The Agent shall not be deemed to have
knowledge of the occurrence of a Default or an Event of Default
(other than the nonpayment of principal of or interest on the Loans)
unless the Agent has received notice from a Bank or the Borrower
specifying such Default or Event of Default and stating that such
notice is a "Notice of Default". In the event that the Agent
receives such a notice of the occurrence of a Default or an Event of
Default, the Agent shall give prompt notice thereof to the Banks.
The Agent shall give each Bank prompt notice of each nonpayment of
principal of or interest on the Loans whether or not it has received
any notice of the occurrence of such nonpayment. The Agent shall
(subject to Section 9.06) take such action hereunder with respect to
such Default or Event of Default as shall be directed by the
Required Banks, provided that, unless and until the Agent shall have
received such directions, the 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 in the best interests of the Banks.
SECTION 7.04. Rights of Agent as a Bank. With respect to the
Loans made by it, Wachovia in its capacity as a Bank hereunder shall
have the same rights and powers hereunder as any other Bank and may
exercise the same as though it were not acting as the Agent, and the
term "Bank" or "Banks" shall, unless the context otherwise
indicates, include Wachovia in its individual capacity. The Agent
may (without having to account therefor to any Bank) accept deposits
45
from, lend money to and generally engage in any kind of banking,
trust or other business with the Borrower (and any of its
Affiliates) as if it were not acting as the Agent, and the Agent may
accept fees and other consideration from the Borrower (in addition
to any agency fees and arrangement fees heretofore agreed to between
the Borrower and the Agent) for services in connection with this
Agreement or any other Loan Document or otherwise without having to
account for the same to the Banks.
SECTION 7.05. Indemnification. Each Bank severally agrees to
indemnify the Agent, to the extent the Agent shall not have been
reimbursed by the Borrower, ratably in accordance with its
Commitment, for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses
(including, without limitation, counsel fees and disbursements) or
disbursements of any kind and nature whatsoever which may be imposed
on, incurred by or asserted against the Agent in any way relating to
or arising out of this Agreement or any other Loan Document or any
other documents contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby (excluding, unless
an Event of Default has occurred and is continuing, the normal
administrative costs and expenses incident to the performance of its
agency duties hereunder) or the enforcement of any of the terms
hereof or thereof or any such other documents; provided, however
that no Bank shall be liable for any of the foregoing to the extent
they arise from the gross negligence or wilful misconduct of the
Agent. If any indemnity furnished to the Agent for any purpose
shall, in the opinion of the Agent, be insufficient or become
impaired, the Agent may call for additional indemnity and cease, or
not commence, to do the acts indemnified against until such
additional indemnity is furnished.
SECTION 7.06. CONSEQUENTIAL DAMAGES. THE AGENT SHALL NOT BE
RESPONSIBLE OR LIABLE TO ANY BANK, THE BORROWER OR ANY OTHER PERSON
OR ENTITY FOR ANY PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH
MAY BE ALLEGED AS A RESULT OF THIS AGREEMENT, THE OTHER LOAN
DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
SECTION 7.07. Payee of Note Treated as Owner. The Agent may
deem and treat the payee of any Note as the owner thereof for all
purposes hereof unless and until a written notice of the assignment
or transfer thereof shall have been filed with the Agent and the
provisions of Section 9.08(c) have been satisfied. Any requests,
authority or consent of any Person who at the time of making such
request or giving such authority or consent is the holder of any
Note shall be conclusive and binding on any subsequent holder,
46
transferee or assignee of that Note or of any Note or Notes issued
in exchange therefor or replacement thereof.
SECTION 7.08. Nonreliance on Agent and Other Banks. Each Bank
agrees that it has, independently and without reliance on the Agent
or any other Bank, and based on such documents and information as it
has deemed appropriate, made its own credit analysis of the Borrower
and decision to enter into this Agreement and that it will,
independently and without reliance upon the Agent or any other Bank,
and based on such documents and information as it shall deem
appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under this Agreement or any
of the other Loan Documents. The Agent shall not be required to
keep itself informed as to the performance or observance by the
Borrower of this Agreement or any of the other Loan Documents or any
other document referred to or provided for herein or therein or to
inspect the properties or books of the Borrower or any other Person.
Except for notices, reports and other documents and information
expressly required to be furnished to the Banks by the Agent
hereunder or under the other Loan Documents, the Agent shall not
have any duty or responsibility to provide any Bank with any credit
or other information concerning the affairs, financial condition or
business of the Borrower or any other Person (or any of their
Affiliates) which may come into the possession of the Agent.
SECTION 7.09. Failure to Act. Except for action expressly
required of the Agent hereunder or under the other Loan Documents,
the Agent shall in all cases be fully justified in failing or
refusing to act hereunder and thereunder unless it shall receive
further assurances to its satisfaction by the Banks of their
indemnification obligations under Section 7.05 against any and all
liability and expense which may be incurred by the Agent by reason
of taking, continuing to take, or failing to take any such action.
SECTION 7.10. Resignation or Removal of Agent. Subject to the
appointment and acceptance of a successor Agent as provided below,
the Agent may resign at any time by giving notice thereof to the
Banks and the Borrower and the Agent may be removed at any time with
or without cause by the Required Banks. Upon any such resignation
or removal, the Required Banks shall have the right to appoint a
successor Agent. If no successor Agent shall have been so appointed
by the Required Banks and shall have accepted such appointment
within 30 days after the retiring Agent's notice of resignation or
the Required Banks' removal of the retiring Agent, then the retiring
Agent may, on behalf of the Banks, appoint a successor Agent. Any
successor Agent shall be a bank which has a combined capital and
surplus of at least $500,000,000. Upon the acceptance of any
47
appointment as Agent hereunder by a successor Agent, such successor
Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation or removal
hereunder as Agent, the provisions of this Article VII shall
continue in effect for its benefit in respect of any actions taken
or omitted to be taken by it while it was acting as the Agent
hereunder.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION
SECTION 8.01. Basis for Determining Interest Rate Inadequate
or Unfair. If on or prior to the first day of any Interest Period:
(a) the Agent determines that deposits in Dollars (in the
applicable amounts) are not being offered in the relevant market for
such Interest Period, or
(b) the Required Banks advise the Agent that the London
Interbank Offered Rate, as reasonably determined by the Agent, will
not adequately and fairly reflect the cost to such Banks of funding
Euro-Dollar Loans for such Interest Period,
the Agent shall forthwith give notice thereof to the Borrower and
the Banks, whereupon until the Agent notifies the Borrower that the
circumstances giving rise to such suspension no longer exist, the
obligations of the Banks to make Euro-Dollar Loans shall be
suspended. After the Agent has provided notice to the Borrower in
connection with this Section 8.01, unless the Borrower notifies the
Agent on or before the date of any such relevant Euro-Dollar
Borrowing for which a Notice of Borrowing has previously been given
that it elects not to borrow on such date, such Borrowing shall
instead be made as a Base Rate Borrowing.
SECTION 8.02. Illegality. If, after the date hereof, the
adoption of any applicable law, rule or regulation, or any change in
any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the
interpretation or administration thereof (any such agency being
referred to as an "Authority" and any such event being referred to
as a "Change of Law"), or compliance by any Bank (or its Lending
Office) with any request or directive (whether or not having the
force of law) of any Authority shall make it unlawful or impossible
for any Bank (or its Lending Office) to make, maintain or fund its
48
Euro-Dollar Loans and such Bank shall so notify the Agent, the Agent
shall forthwith give notice thereof to the other Banks and the
Borrower, whereupon until such Bank notifies the Borrower and the
Agent that the circumstances giving rise to such suspension no
longer exist, the obligation of such Bank to make Euro-Dollar Loans
shall be suspended. Before giving any notice to the Agent pursuant
to this Section, such Bank shall designate a different Lending
Office if such designation will avoid the need for giving such
notice and will not, in the judgment of such Bank, be otherwise
disadvantageous to such Bank. If such Bank shall reasonably
determine that it may not lawfully continue to maintain and fund any
of its outstanding Euro-Dollar Loans to maturity and shall so
specify in such notice, the Borrower shall immediately prepay in
full the then outstanding principal amount of each Euro-Dollar Loan
of such Bank, together with accrued interest thereon. Concurrently
with prepaying each such Euro-Dollar Loan, the Borrower shall borrow
a Base Rate Loan in an equal principal amount from such Bank (on
which interest and principal shall be payable contemporaneously with
the related Euro-Dollar Loans of the other Banks), and such Bank
shall make such a Base Rate Loan.
SECTION 8.03. Increased Cost and Reduced Return. (a) If after
the date hereof, a Change of Law or compliance by any Bank (or its
Lending Office) with any request or directive (whether or not having
the force of law) of any Authority:
(i) shall subject any Bank (or its Lending Office) to any
tax, duty or other charge with respect to its Loans, Notes, or
its obligation to make Loans, or shall change the basis of
taxation of payments to any Bank (or its Lending Office) of the
principal of or interest on its Loans or any other amounts due
under this Agreement in respect of its Loans or its obligation
to make Loans (except for changes in the rate of tax on the
overall net income of such Bank, or any other tax having the
same practical effect as a tax on the overall net income of
such Bank, or its Lending Office imposed by the jurisdiction in
which such Bank's principal executive office or Lending Office
is located or engaged in business); or
(ii) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement (including, without
limitation, any such requirement imposed by the Board of
Governors of the Federal Reserve System, but excluding with
respect to any Euro-Dollar Loan any such requirement included
in an applicable Euro-Dollar Reserve Percentage) against assets
of, deposits with or for the account of, or credit extended by,
any Bank (or its Lending Office); or
49
(iii) shall impose on any Bank (or its Lending Office) or
on the United States market or the London interbank market any
other condition affecting its Loans, Notes, or its obligation
to make Loans;
and the result of any of the foregoing is to increase the cost to
such Bank (or its Lending Office) of making or maintaining any Loan,
or to reduce the amount of any sum received or receivable by such
Bank (or its Lending Office) under this Agreement or under its Notes
with respect thereto, by an amount reasonably determined by such
Bank to be material, then, within 15 days after demand by such Bank
(with a copy to the Agent), the Borrower shall pay to such Bank such
additional amount or amounts as will compensate such Bank for such
increased cost or reduction.
(b) If any Bank shall have determined that after the date
hereof the adoption of any applicable law, rule or regulation
regarding capital adequacy, or any change therein, or any change in
the interpretation or administration thereof, or compliance by any
Bank (or its Lending Office) or any Person controlling such Bank
with any request or directive regarding capital adequacy (whether or
not having the force of law) of any Authority, has or would have the
effect of reducing the rate of return on such Bank's or such
controlling Person's capital as a consequence of its obligations
hereunder to a level below that which such Bank or such controlling
Person could have achieved but for such adoption, change or
compliance (taking into consideration such Bank's or such
controlling Person's policies with respect to capital adequacy) by
an amount reasonably determined by such Bank or such controlling
Person to be material, then from time to time, within 15 days after
demand by such Bank or such controlling Person, the Borrower shall
pay to such Bank such additional amount or amounts as will
compensate such Bank or such controlling Person for such reduction.
(c) Each Bank will promptly notify the Borrower and the Agent
of any event of which it has knowledge, occurring after the date
hereof, which will entitle such Bank to compensation pursuant to
this Section and will designate a different Lending Office if such
designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the judgment of such Bank, be
otherwise disadvantageous to such Bank. A certificate of any Bank
claiming compensation under this Section and setting forth in
reasonable detail the additional amount or amounts to be paid to it
hereunder shall constitute rebuttable presumptive evidence of the
amounts to be paid in the absence of manifest error. In determining
such amount, such Bank may use any reasonable averaging and
attribution methods.
50
(d) The provisions of this Section 8.03(i) shall be applicable
with respect to any Participant, Assignee or other Transferee, and
any calculations required by such provisions shall be made based
upon the circumstances of such Participant, Assignee or other
Transferee and (ii) shall constitute a continuing agreement and
shall survive the termination of this Agreement and the payment in
full or cancellation of the Notes.
SECTION 8.04. Base Rate Loans Substituted for Euro-Dollar
Loans. If (i) the obligation of any Bank to make or maintain
Euro-Dollar Loans has been suspended pursuant to Section 8.02 or
(ii) any Bank has demanded compensation under Section 8.03, and the
Borrower shall, by at least 5 Euro-Dollar Business Days' prior
notice to such Bank through the Agent, have elected that the
provisions of this Section shall apply to such Bank, then, unless
and until such Bank notifies the Borrower that the circumstances
giving rise to such suspension or demand for compensation no longer
apply:
(a) all Loans which would otherwise be made by such Bank as
Euro-Dollar Loans shall be made instead as Base Rate Loans (in all
cases interest and principal on such Loans shall be payable
contemporaneously with the related Euro-Dollar Loans of the other
Banks); and
(b) after each of its Euro-Dollar Loans has been repaid, all
payments of principal which would otherwise be applied to repay such
Euro-Dollar Loans shall be applied to repay its Base Rate Loans
instead.
SECTION 8.05. Compensation. Upon the request of any Bank,
delivered to the Borrower and the Agent, the Borrower shall pay to
such Bank such amount or amounts as shall compensate such Bank for
any loss, cost or expense incurred by such Bank as a result of:
(a) any payment or prepayment (pursuant to Section 8.02 or
otherwise) of a Euro-Dollar Loan on a date other than the last day
of an Interest Period for such Loan; or
(b) any failure by the Borrower to borrow a Euro-Dollar Loan
on the date for the Euro-Dollar Borrowing of which such Euro-Dollar
Loan is a part specified in the applicable Notice of Borrowing
delivered pursuant to Section 2.02; such compensation to include,
without limitation, an amount equal to the excess, if any, of (x)
the amount of interest which would have accrued on the amount so
paid or prepaid or not prepaid or borrowed for the period from the
date of such payment, prepayment or failure to prepay or borrow to
the last day of the then current Interest Period for such
Euro-Dollar Loan (or, in the case of a failure to prepay or borrow,
51
the Interest Period for such Euro-Dollar Loan which would have
commenced on the date of such failure to prepay or borrow) at the
applicable rate of interest for such Euro-Dollar Loan provided for
herein over (y) the amount of interest (as reasonably determined by
such Bank) such Bank would have paid on deposits in Dollars of
comparable amounts having terms comparable to such period placed
with it by leading banks in the London interbank market.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including
bank wire, telecopier or similar writing) and shall be given to such
party at its address or telecopier number set forth on the signature
pages hereof or such other address or telecopier number as such
party may hereafter specify for the purpose by notice to each other
party. Each such notice, request or other communication shall be
effective (i) if given by telecopier, when such telecopy is
transmitted to the telecopier number specified in this Section and
the appropriate confirmation is received, (ii) if given by mail, 72
hours after such communication is deposited in the mails with first
class postage prepaid, addressed as aforesaid or (iii) if given by
any other means, when delivered at the address specified in this
Section; provided that notices to the Agent under Article II or
Article VIII shall not be effective until received.
SECTION 9.02. No Waivers. No failure or delay by the Agent or
any Bank in exercising any right, power or privilege hereunder or
under any Note or other Loan Document shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude
any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies herein provided
shall be cumulative and not exclusive of any rights or remedies
provided by law.
SECTION 9.03. Expenses; Documentary Taxes. The Borrower shall
pay (i) all reasonable out-of-pocket expenses of the Agent,
including fees and disbursements of special counsel for the Banks
and the Agent, in connection with the preparation of this Agreement
and the other Loan Documents, any waiver or consent hereunder or
thereunder or any amendment hereof or thereof or any Default or
alleged Default hereunder or thereunder and (ii) if a Default
occurs, all reasonable out-of-pocket expenses incurred by the Agent
and the Banks, including fees and disbursements of counsel, in
connection with such Default and collection and other enforcement
52
proceedings resulting therefrom, including out-of-pocket expenses
incurred in enforcing this Agreement and the other Loan Documents.
The Borrower shall indemnify the Agent and each Bank against any
transfer taxes, documentary taxes, assessments or charges made by
any Authority by reason of the execution and delivery of this
Agreement or the other Loan Documents.
SECTION 9.04. Indemnification. The Borrower shall indemnify
the Agent, the Banks and each Affiliate thereof and their respective
directors, officers, employees and agents from, and hold each of
them harmless against, any and all losses, liabilities, claims or
damages to which any of them may become subject, insofar as such
losses, liabilities, claims or damages arise out of or result from
any actual or proposed use by the Borrower of the proceeds of any
extension of credit by any Bank hereunder or breach by the Borrower
of this Agreement or any other Loan Document or from any
investigation, litigation (including, without limitation, any
actions taken by the Agent or any of the Banks to enforce this
Agreement or any of the other Loan Documents) or other proceeding
(including, without limitation, any threatened investigation or
proceeding) relating to the foregoing, and the Borrower shall
reimburse the Agent and each Bank, and each Affiliate thereof and
their respective directors, officers, employees and agents, upon
demand for any expenses (including, without limitation, legal fees)
incurred in connection with any such investigation or proceeding;
but excluding any such losses, liabilities, claims, damages or
expenses incurred by reason of the gross negligence or wilful
misconduct of the Person to be indemnified.
SECTION 9.05. Setoff; Sharing of Setoffs. (a) The Borrower
agrees that the Agent and each Bank shall have a lien for all
indebtedness and obligations owing to them from the Borrower upon
all deposits or deposit accounts, of any kind, or any interest in
any deposits or deposit accounts thereof, now or hereafter pledged,
mortgaged, transferred or assigned to the Agent or any such Bank or
otherwise in the possession or control of the Agent or any such Bank
for any purpose for the account or benefit of the Borrower and
including any balance of any deposit account or of any credit of the
Borrower with the Agent or any such Bank, whether now existing or
hereafter established hereby authorizing the Agent and each Bank at
any time or times with or without prior notice to apply such
balances or any part thereof to such of the indebtedness and
obligations owing by the Borrower to the Banks and/or the Agent then
past due and in such amounts as they may elect, and whether or not
the collateral, if any, or the responsibility of other Persons
primarily, secondarily or otherwise liable may be deemed adequate.
For the purposes of this paragraph, all remittances and property
53
shall be deemed to be in the possession of the Agent or any such
Bank as soon as the same may be put in transit to it by mail or
carrier or by other bailee.
(b) Each Bank agrees that if it shall, by exercising any right
of setoff or counterclaim or otherwise, receive payment of a
proportion of the aggregate amount of principal and interest owing
with respect to the Note held by it which is greater than the
proportion received by any other Bank in respect of the aggregate
amount of all principal and interest owing with respect to the Note
held by such other Bank, the Bank receiving such proportionately
greater payment shall purchase such participations in the Notes held
by the other Banks owing to such other Banks, and such other
adjustments shall be made, as may be required so that all such
payments of principal and interest with respect to the Notes held by
the Banks owing to such other Banks shall be shared by the Banks pro
rata; provided that (i) nothing in this Section shall impair the
right of any Bank to exercise any right of setoff or counterclaim it
may have and to apply the amount subject to such exercise to the
payment of indebtedness of the Borrower other than its indebtedness
under the Notes, and (ii) if all or any portion of such payment
received by the purchasing Bank is thereafter recovered from such
purchasing Bank, such purchase from each other Bank shall be
rescinded and such other Bank shall repay to the purchasing Bank the
purchase price of such participation to the extent of such recovery
together with an amount equal to such other Bank's ratable share
(according to the proportion of (x) the amount of such other Bank's
required repayment to (y) the total amount so recovered from the
purchasing Bank) of any interest or other amount paid or payable by
the purchasing Bank in respect of the total amount so recovered.
The Borrower agrees, to the fullest extent it may effectively do so
under applicable law, that any holder of a participation in a Note,
whether or not acquired pursuant to the foregoing arrangements, may
exercise rights of setoff or counterclaim and other rights with
respect to such participation as fully as if such holder of a
participation were a direct creditor of the Borrower in the amount
of such participation.
SECTION 9.06. Amendments and Waivers. (a) Any provision of
this Agreement, the Notes or any other Loan Documents may be amended
or waived if, but only if, such amendment or waiver is in writing
and is signed by the Borrower and the Required Banks (and, if the
rights or duties of the Agent are affected thereby, by the Agent);
provided that, no such amendment or waiver shall, unless signed by
all Banks, (i) change the Commitment of any Bank or subject any Bank
to any additional obligation, (ii) change the principal of or rate
of interest on any Loan or any fees (other than fees payable to the
Agent) hereunder, (iii) change the date fixed for any payment of
54
principal of or interest on any Loan or any fees hereunder, (iv)
change the amount of principal, interest or fees due on any date
fixed for the payment thereof, (v) change the percentage of the
Commitments or of the aggregate unpaid principal amount of the
Notes, or the percentage of Banks, which shall be required for the
Banks or any of them to take any action under this Section or any
other provision of this Agreement, (vi) change the manner of
application of any payments made under this Agreement or the Notes,
(vii) release or substitute all or any substantial part of the
collateral (if any) held as security for the Loans, or (viii)
release any Guarantee given to support payment of the Loans.
(b) The Borrower will not solicit, request or negotiate for or
with respect to any proposed waiver or amendment of any of the
provisions of this Agreement unless each Bank shall be informed
thereof by the Borrower and shall be afforded an opportunity of
considering the same and shall be supplied by the Borrower with
sufficient information to enable it to make an informed decision
with respect thereto. Executed or true and correct copies of any
waiver or consent effected pursuant to the provisions of this
Agreement shall be delivered by the Borrower to each Bank forthwith
following the date on which the same shall have been executed and
delivered by the requisite percentage of Banks. The Borrower will
not, directly or indirectly, pay or cause to be paid any
remuneration, whether by way of supplemental or additional interest,
fee or otherwise, to any Bank (in its capacity as such) as
consideration for or as an inducement to the entering into by such
Bank of any waiver or amendment of any of the terms and provisions
of this Agreement unless such remuneration is concurrently paid, on
the same terms, ratably to all such Banks.
SECTION 9.07. No Margin Stock Collateral. Each of the Banks
represents to the Agent and each of the other Banks that it in good
faith is not, directly or indirectly (by negative pledge or
otherwise), relying upon any Margin Stock as collateral in the
extension or maintenance of the credit provided for in this
Agreement.
SECTION 9.08. Successors and Assigns. (a) The provisions of
this Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns; provided
that the Borrower may not assign or otherwise transfer any of its
rights under this Agreement.
(b) Any Bank may at any time sell to one or more Persons (each
a "Participant") participating interests in any Loan owing to such
Bank, any Note held by such Bank, any Commitment hereunder or any
other interest of such Bank hereunder. In the event of any such
sale by a Bank of a participating interest to a Participant, such
55
Bank's obligations under this Agreement shall remain unchanged, such
Bank shall remain solely responsible for the performance thereof,
such Bank shall remain the holder of any such Note for all purposes
under this Agreement, and the Borrower and the Agent shall continue
to deal solely and directly with such Bank in connection with such
Bank's rights and obligations under this Agreement. In no event
shall a Bank that sells a participation be obligated to the
Participant to take or refrain from taking any action hereunder
except that such Bank may agree that it will not (except as provided
below), without the consent of the Participant, agree to (i) the
change of any date fixed for the payment of principal of or interest
on the related loan or loans, (ii) the change of the amount of any
principal, interest or fees due on any date fixed for the payment
thereof with respect to the related loan or loans, (iii) the change
of the principal of the related loan or loans, (iv) any change in
the rate at which either interest is payable thereon or (if the
Participant is entitled to any part thereof) fee is payable
hereunder from the rate at which the Participant is entitled to
receive interest or fee (as the case may be) in respect of such
participation, (v) the release or substitution of all or any
substantial part of the collateral (if any) held as security for the
Loans, or (vi) the release of any Guarantee given to support payment
of the Loans. Each Bank selling a participating interest in any
Loan, Note, Commitment or other interest under this Agreement shall,
within 10 Domestic Business Days of such sale, provide the Borrower
and the Agent with written notification stating that such sale has
occurred and identifying the Participant and the interest purchased
by such Participant. The Borrower agrees that each Participant
shall be entitled to the benefits of Article VIII with respect to
its participation in Loans outstanding from time to time.
(c) Any Bank may at any time assign to one or more banks or
financial institutions (each an "Assignee") all, or a proportionate
part of all, of its rights and obligations under this Agreement, the
Notes and the other Loan Documents, and such Assignee shall assume
all such rights and obligations, pursuant to an Assignment and
Acceptance, executed by such Assignee, such transferor Bank and the
Agent (and, in the case of an Assignee that is not then a Bank,
subject to clause (iii) below, by the Borrower); provided that (i)
no interest may be sold by a Bank pursuant to this paragraph (c)
unless the Assignee shall agree to assume ratably equivalent
portions of the transferor Bank's Commitment, (ii) the amount of the
respective Commitment of both the purchasing Bank and the selling
Bank (determined as of the effective date of the assignment) shall
be equal to or in excess of $5,000,000 (unless the selling Bank
shall have assigned its entire Commitment), (iii) except during the
continuance of a Default, no interest may be sold by a Bank pursuant
56
to this paragraph (c) to any Assignee that is not then a Bank (or an
Affiliate of a Bank) without the consent of the Borrower and the
Agent, which consent shall not be unreasonably withheld, and (iv) a
Bank may not have more than 2 Assignees that are not then Banks at
any one time. Upon (A) execution of the Assignment and Acceptance
by such transferor Bank, such Assignee, the Agent and (if
applicable) the Borrower, (B) delivery of an executed copy of the
Assignment and Acceptance to the Borrower and the Agent, (C) payment
by such Assignee to such transferor Bank of an amount equal to the
purchase price agreed between such transferor Bank and such
Assignee, and (D) payment of a processing and recordation fee of
$2,500 to the Agent, such Assignee shall for all purposes be a Bank
party to this Agreement and shall have all the rights and
obligations of a Bank under this Agreement to the same extent as if
it were an original party hereto with a Commitment as set forth in
such instrument of assumption, and the transferor Bank shall be
released from its obligations hereunder to a corresponding extent,
and no further consent or action by the Borrower, the Banks or the
Agent shall be required. Upon the consummation of any transfer to
an Assignee pursuant to this paragraph (c), the transferor Bank, the
Agent and the Borrower shall make appropriate arrangements so that,
if required, a new Note is issued to such Assignee.
(d) Subject to the provisions of Section 9.09, the Borrower
authorizes each Bank to disclose to any Participant, Assignee or
other transferee (each a "Transferee") and any prospective
Transferee any and all financial information in such Bank's
possession concerning the Borrower which has been delivered to such
Bank by the Borrower pursuant to this Agreement or which has been
delivered to such Bank by the Borrower in connection with such
Bank's credit evaluation prior to entering into this Agreement.
(e) No Transferee shall be entitled to receive any greater
payment under Section 8.03 than the transferor Bank would have been
entitled to receive with respect to the rights transferred, unless
such transfer is made with the Borrower's prior written consent or
by reason of the provisions of Section 8.02 or 8.03 requiring such
Bank to designate a different Lending Office under certain
circumstances or at a time when the circumstances giving rise to
such greater payment did not exist.
(f) Anything in this Section 9.08 to the contrary
notwithstanding, any Bank may assign and pledge all or any portion
of the Loans and/or obligations owing to it to any Federal Reserve
Bank or the United States Treasury as collateral security pursuant
to Regulation A of the Board of Governors of the Federal Reserve
System and any Operating Circular issued by such Federal Reserve
Bank, provided that any payment in respect of such assigned Loans
57
and/or obligations made by the Borrower to the assigning and/or
pledging Bank in accordance with the terms of this Agreement shall
satisfy the Borrower's obligations hereunder in respect of such
assigned Loans and/or obligations to the extent of such payment. No
such assignment shall release the assigning and/or pledging Bank
from its obligations hereunder.
SECTION 9.09. Confidentiality. Each Bank agrees to exercise
commercially reasonable efforts to keep any information delivered or
made available by the Borrower to it which is clearly indicated to
be confidential information, confidential from anyone other than
persons employed or retained by such Bank who are or are expected to
become engaged in evaluating, approving, structuring or
administering the Loans; provided, however that nothing herein shall
prevent any Bank from disclosing such information (i) to any other
Bank, (ii) upon the order of any court or administrative agency,
(iii) upon the request or demand of any regulatory agency or
authority having jurisdiction over such Bank, (iv) which has been
publicly disclosed, (v) to the extent reasonably required in
connection with any litigation to which the Agent, any Bank or their
respective Affiliates may be a party, (vi) to the extent reasonably
required in connection with the exercise of any remedy hereunder,
(vii) to such Bank's legal counsel and independent auditors and
(viii) to any actual or proposed Participant, Assignee or other
Transferee of all or part of its rights hereunder which has agreed
in writing to be bound by the provisions of this Section 9.09;
provided, that, should disclosure of any such confidential
information be required by virtue of clauses (ii), (iii) or (v) of
the immediately preceding sentence, any relevant Bank shall promptly
notify the Borrower of same so as to allow the Borrower to seek a
protective order or to take any other appropriate action; provided,
further, that, no Bank shall be required to delay compliance with
any directive to disclose any such information so as to allow the
Borrower to effect any such action. Upon the termination of this
Agreement (and the cancellation of all of the Commitments hereunder)
and the repayment in full of all amounts owing hereunder to the
Agent and the Banks, the Agent and the Banks, following the
Borrower's written request therefor, shall return to the Borrower
all confidential information, other than any such information which
must be retained by the Banks or the Agent due to legal and/or
regulatory retention requirements, then in the possession of the
Agent and the Banks (so long as there shall not be any reasonable
need for any such information in connection with any of the types of
matters referred to in clauses (v) or (vi) of the first sentence of
this Section).
SECTION 9.10. Representation by Banks. Each Bank hereby
represents that it is a commercial lender or financial institution
58
which makes Loans in the ordinary course of its business and that it
will make its Loans hereunder for its own account in the ordinary
course of such business; provided, however that, subject to Section
9.08, the disposition of the Note or Notes held by that Bank shall
at all times be within its exclusive control.
SECTION 9.11. Obligations Several. The obligations of each
Bank hereunder are several, and no Bank shall be responsible for the
obligations or commitment of any other Bank hereunder. Nothing
contained in this Agreement and no action taken by the Banks
pursuant hereto shall be deemed to constitute the Banks to be a
partnership, an association, a joint venture or any other kind of
entity. The amounts payable at any time hereunder to each Bank
shall be a separate and independent debt, and each Bank shall be
entitled to protect and enforce its rights arising out of this
Agreement or any other Loan Document and it shall not be necessary
for any other Bank to be joined as an additional party in any
proceeding for such purpose.
SECTION 9.12. Georgia Law. This Agreement and each Note shall
be construed in accordance with and governed by the law of the State
of Georgia.
SECTION 9.13. Severability. In case any one or more of the
provisions contained in this Agreement, the Notes or any of the
other Loan Documents should be invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the
remaining provisions contained herein and therein shall not in any
way be affected or impaired thereby and shall be enforced to the
greatest extent permitted by law.
SECTION 9.14. Interest. In no event shall the amount of
interest due or payable hereunder or under the Notes exceed the
maximum rate of interest allowed by applicable law, and in the event
any such payment is inadvertently made to any Bank by the Borrower
or inadvertently received by any Bank, then such excess sum shall be
credited as a payment of principal, unless the Borrower shall notify
such Bank in writing that it elects to have such excess sum returned
forthwith. It is the express intent hereof that the Borrower not
pay and the Banks not receive, directly or indirectly in any manner
whatsoever, interest in excess of that which may legally be paid by
the Borrower under applicable law.
SECTION 9.15. Interpretation. No provision of this Agreement
or any of the other Loan Documents shall be construed against or
interpreted to the disadvantage of any party hereto by any court or
59
other governmental or judicial authority by reason of such party
having or being deemed to have structured or dictated such
provision.
SECTION 9.16. Consent to Jurisdiction. The Borrower (a)
submits to the nonexclusive personal jurisdiction in the State of
Georgia, the courts thereof and the United States District Courts
sitting therein, for the enforcement of this Agreement, the Notes
and the other Loan Documents, (b) waives any and all personal rights
under the law of any jurisdiction to object on any basis (including,
without limitation, inconvenience of forum) to jurisdiction or venue
within the State of Georgia for the purpose of litigation to enforce
this Agreement, the Notes or the other Loan Documents, and (c)
agrees that service of process may be made upon it in the manner
prescribed in Section 9.01 for the giving of notice to the Borrower.
Nothing herein contained, however, shall prevent the Agent from
bringing any action or exercising any rights against any security
and against the Borrower personally, and against any assets of the
Borrower, within any other state or jurisdiction.
SECTION 9.17. Counterparts. This Agreement may be signed in
any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon
the same instrument.
SECTION 9.18. Source of Funds -- ERISA. Each of the Banks
hereby severally (and not jointly) represents to the Borrower that
no part of the funds to be used by such Bank to fund the Loans
hereunder from time to time constitutes (i) assets allocated to any
separate account maintained by such Bank in which any employee
benefit plan (or its related trust) has any interest nor (ii) any
other assets of any employee benefit plan. As used in this Section,
the terms "employee benefit plan" and "separate account" shall have
the respective meanings assigned to such terms in Section 3 of
ERISA.
SECTION 9.19. Entire Agreement. Except as otherwise expressly
provided herein, this Agreement and the other documents described or
contemplated herein embody the entire agreement and understanding
among the parties hereto and thereto and supersede all prior
agreements, understandings, and conversations relating to the
subject matter hereof and thereof. The Borrower represents and
warrants to the Bank that it has read the provisions of this Section
9.19 and discussed the provisions of this Section 9.19 and the
remainder of this Agreement with counsel for the Borrower, and the
Borrower acknowledges and agrees that the Agent and each Bank is
expressly relying upon such representations and warranties of the
Borrower (as well as the other representations and warranties of the
60
Borrower set forth in Article IV hereof) in entering into this
Agreement and the other Loan Documents.
61
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, under seal, by their respective
authorized officers as of the day and year first above written.
NATIONAL VISION ASSOCIATES,
LTD. (SEAL)
By: /S/ Xxxxxx X. Xxxxx
Title: CFO
000 Xxxxxxx Xxxxxxx
Xxxxxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxx
Telecopier number: 000-000-0000
Confirmation number: 000-000-0000
with a copy to:
Xxxxxxxx Xxxxxxx, Esq.
National Vision Associates, Ltd.
000 Xxxxxxx Xxxxxxx
Xxxxxxxxxxxxx, Xxxxxxx 00000
Telecopier number: 000-000-0000
Confirmation number: 000-000-0000
62
COMMITMENTS WACHOVIA BANK, N.A.,
as Agent and as a Bank (SEAL)
$27,500,000.00
By: /S/ Xxxxxx X. Xxxxxxxx
Title: V.P.
Lending Office
Wachovia Bank, N.A.
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Atlanta Corporate Group
Telecopier number: 000-000-0000
Confirmation number: 000-000-0000
00
XXXXXXXX XXXX, XXXXXXX (XXXX)
$10,000,000.00 By: /S/ Xxxxxx X. Xxxxx, Xx.
Title: V.P.
By: /S/ Xxx Xxxxxx
Title: Banking Officer
Lending Office
Southeast Corporate Banking I
P. O. Box 4418
Xxxxxxx, Xxxxxxx 00000
Attention: Xxx Xxxxxxx
Telecopier number: (000) 000-0000
Confirmation number: (000) 000-0000
64
$7,500,000.00 BANK OF AMERICA, FSB (SEAL)
By: /S/ Xxxx X. Xxxxxxx
Title: V.P.
Lending Office
Bank of America, FSB
0000 Xxxxxxxxx Xxxxxx, Xxx. 0000
Xxxxxxx, Xxxxxxx 00000
Telecopier number: (000) 000-0000
Confirmation number: (000) 000-0000
TOTAL COMMITMENTS:
$45,000,000.00
65
