EXHIBIT 10(i)
364-DAY CREDIT AGREEMENT
Dated as of March 27, 2002
among
THE DIAL CORPORATION
as Borrower,
CERTAIN DOMESTIC SUBSIDIARIES OF THE BORROWER
FROM TIME TO TIME PARTIES HERETO
as Guarantors,
THE LENDERS NAMED HEREIN
and
FIRST UNION NATIONAL BANK,
as Administrative Agent
FIRST UNION SECURITIES, INC.,
d/b/a WACHOVIA SECURITIES
as Lead Arranger and Book Manager
TABLE OF CONTENTS
SECTION 1 DEFINITIONS ........................................................................... 1
1.1 Definitions.......................................................... 1
1.2 Computation of Time Periods..........................................20
1.3 Accounting Terms.....................................................20
SECTION 2 CREDIT FACILITY .......................................................................20
2.1 Revolving Loans......................................................20
SECTION 3 OTHER PROVISIONS RELATING TO CREDIT FACILITIES ........................................23
3.1 Default Rate.........................................................23
3.2 Extension and Conversion.............................................24
3.3 Prepayments..........................................................24
3.4 Termination, Reduction and Increase of Commitments...................25
3.5 Fees.................................................................26
3.6 Computation of Interest and Fees.....................................26
3.7 Pro Rata Treatment and Payments......................................27
3.8 Non-Receipt of Funds by the Administrative Agent.....................28
3.9 Inability to Determine Interest Rate.................................29
3.10 Illegality...........................................................30
3.11 Requirements of Law..................................................30
3.12 Indemnity............................................................32
3.13 Taxes................................................................32
SECTION 4 CONDITIONS ............................................................................34
4.1 Conditions to Closing................................................34
4.2 Conditions to All Loans..............................................36
SECTION 5 REPRESENTATIONS AND WARRANTIES ........................................................37
5.1 Financial Condition..................................................37
5.2 No Material Adverse Change...........................................38
5.3 Organization; Existence..............................................38
5.4 Power; Authorization; Enforceable Obligations........................38
5.5 Conflict.............................................................38
5.6 No Material Litigation...............................................39
5.7 No Default...........................................................39
5.8 Taxes................................................................39
5.9 ERISA................................................................39
5.10 Governmental Regulations, Etc........................................40
5.11 Subsidiaries.........................................................40
5.12 Use of Proceeds......................................................40
5.13 Compliance with Laws; Contractual Obligations........................40
5.14 Accuracy and Completeness of Information.............................41
5.15 Environmental Matters................................................41
5.16 Solvency.............................................................41
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5.17 No Burdensome Restrictions...........................................41
5.18 Material Contracts...................................................42
5.19 Insurance............................................................42
SECTION 6 AFFIRMATIVE COVENANTS .................................................................42
6.1 Financial Statements.................................................42
6.2 Certificates; Other Information......................................43
6.3 Notices..............................................................43
6.4 Maintenance of Existence; Compliance with Laws; Contractual
Obligations..........................................................44
6.5 Maintenance of Property; Insurance...................................44
6.6 Inspection of Property; Books and Records; Discussions...............45
6.7 Financial Covenants..................................................45
6.9 Additional Guarantors................................................45
6.10 Payment of Obligations...............................................45
6.11 Environmental Laws...................................................46
SECTION 7 NEGATIVE COVENANTS ....................................................................46
7.1 Indebtedness.........................................................46
7.2 Liens................................................................47
7.3 Nature of Business...................................................48
7.4 Consolidation, Merger, Sale or Purchase of Assets, etc...............48
7.5 Advances, Investments and Loans......................................49
7.6 Transactions with Affiliates.........................................49
7.7 Fiscal Year; Organizational Documents; Material Contracts............49
7.8 Limitation on Restricted Actions.....................................49
7.9 Restricted Payments..................................................50
7.10 Sale Leasebacks......................................................50
SECTION 8 EVENTS OF DEFAULT .....................................................................50
8.1 Events of Default....................................................50
8.2 Acceleration; Remedies...............................................53
SECTION 9 AGENCY PROVISIONS .....................................................................53
9.1 Appointment..........................................................53
9.2 Delegation of Duties.................................................54
9.3 Exculpatory Provisions...............................................54
9.4 Reliance by Administrative Agent.....................................54
9.5 Notice of Default....................................................55
9.6 Non-Reliance on Administrative Agent and Other Lenders...............55
9.7 Indemnification......................................................56
9.8 Administrative Agent in Its Individual Capacity......................56
9.9 Successor Administrative Agent.......................................56
SECTION 10 MISCELLANEOUS ........................................................................57
10.1 Amendments, Waivers and Release of Collateral........................57
10.2 Notices..............................................................58
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10.3 No Waiver; Cumulative Remedies.......................................59
10.4 Survival of Representations and Warranties...........................60
10.5 Payment of Expenses and Taxes........................................60
10.6 Successors and Assigns; Participations; Purchasing Lenders...........60
10.7 Adjustments; Set-off.................................................63
10.8 Table of Contents and Section Headings...............................64
10.9 Counterparts.........................................................64
10.10 Effectiveness........................................................64
10.11 Severability.........................................................64
10.12 Integration..........................................................65
10.13 Governing Law........................................................65
10.14 Consent to Jurisdiction and Service of Process.......................65
10.15 Arbitration..........................................................65
10.16 Confidentiality......................................................67
10.17 Acknowledgments......................................................67
10.18 Waivers of Jury Trial................................................67
SECTION 11 GUARANTY .............................................................................68
11.1 The Guaranty.........................................................68
11.2 Bankruptcy...........................................................68
11.3 Nature of Liability..................................................69
11.4 Independent Obligation...............................................69
11.5 Authorization........................................................69
11.6 Reliance.............................................................69
11.7 Waiver...............................................................70
11.8 Limitation on Enforcement............................................71
11.9 Confirmation of Payment..............................................71
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SCHEDULES
Schedule 1.1-1 Form of Account Designation Letter
Schedule 1.1-2 Permitted Liens
Schedule 2.1(a) Schedule of Lenders and Commitments
Schedule 2.1(b)(i) Form of Notice of Borrowing
Schedule 2.1(e) Form of Revolving Note
Schedule 3.2 Form of Notice of Extension/Conversion
Schedule 3.4(c) New Commitment Agreement
Schedule 3.13 3.13 Certificate
Schedule 4.1(e) Form of Secretary's Certificate
Schedule 4.1(j) Material Adverse Effect
Schedule 5.6 Material Litigation
Schedule 5.11 Subsidiaries
Schedule 5.18 Material Contracts
Schedule 6.2(a) Form of Officer's Compliance Certificate
Schedule 6.9 Form of Joinder Agreement
Schedule 7.1(b) Indebtedness
Schedule 7.5 Investments
Schedule 10.2 Schedule of Lenders' Lending Offices
Schedule 10.6(c) Form of Commitment Transfer Supplement
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364-DAY CREDIT AGREEMENT
THIS 364-DAY CREDIT AGREEMENT dated as of March 27, 2002 (the "Credit
Agreement"), is by and among THE DIAL CORPORATION, a Delaware corporation (the
"Borrower"), certain Domestic Subsidiaries of the Borrower listed on the
signature pages hereto and as may from time to time become a party hereto
(collectively the "Guarantors" and individually, a "Guarantor"), the lenders
named herein and such other lenders as may become a party hereto (the "Lenders"
and individually, a "Lender") and FIRST UNION NATIONAL BANK, as Administrative
Agent for the Lenders (in such capacity, the "Administrative Agent").
W I T N E S S E T H
WHEREAS, the Borrower has requested that the Lenders provide a $75
million credit facility for the purposes hereinafter set forth; and
WHEREAS, the Lenders have agreed to make the requested credit facility
available to the Borrower on the terms and conditions hereinafter set forth.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS
1.1 Definitions.
As used in this Credit Agreement, the following terms shall have the
meanings specified below unless the context otherwise requires:
"Account Designation Letter" means the Notice of Account Designation
Letter dated the Closing Date from the Borrower to the Administrative Agent in
substantially the form attached hereto as Schedule 1.1-1.
"Additional Commitment" means, with respect to any Lender which
executes a New Commitment Agreement in accordance with Section 3.4(c), the
commitment of such Lender in an aggregate principal amount up to the amount
specified in such New Commitment Agreement to make Revolving Loans in accordance
with the provisions of Section 2.1.
"Administrative Agent" shall have the meaning assigned to such term in
the first paragraph hereof, together with any successors or assigns.
"Administrative Agent's Fees" shall have the meaning assigned to such
term in Section 3.5(c).
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"Affiliate" means as to any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control with,
such Person. For purposes of this definition, a Person shall be deemed to be
"controlled by" a Person if such Person possesses, directly or indirectly, power
either (a) to vote 20% or more of the securities having ordinary voting power
for the election of directors of such Person or (b) to direct or cause the
direction of the management and policies of such Person whether by contract or
otherwise.
"Aggregate Commitment" means, for any Utilization Period, the sum of
the Aggregate Revolving Committed Amount under this Credit Agreement and the
commitments under the Three Year Credit Agreement.
"Aggregate Revolving Committed Amount" means the aggregate amount of
Commitments in effect from time to time, being initially SEVENTY FIVE MILLION
DOLLARS ($75,000,000), and as such aggregate amount may be increased or reduced
from time to time as provided in Sections 2.1(h) and 3.4.
"Alternate Base Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest whole multiple of 1/100 of 1%) equal to
the greater of (a) the Federal Funds Rate in effect on such day plus 1/2 of 1%
or (b) the Prime Rate in effect on such day. If for any reason the
Administrative Agent shall have reasonably determined (which determination shall
be conclusive absent manifest error) that it is unable after due inquiry to
ascertain the Federal Funds Rate for any reason, including the inability or
failure of the Administrative Agent to obtain sufficient quotations in
accordance with the terms hereof, the Alternate Base Rate shall be determined
without regard to clause (a) of the first sentence of this definition until the
circumstances giving rise to such inability no longer exist. Any change in the
Alternate Base Rate due to a change in the Prime Rate or the Federal Funds Rate
shall be effective on the effective date of such change in the Prime Rate or the
Federal Funds Rate, respectively.
"Alternate Base Rate Loans" means Loans that bear interest at an
interest rate based on the Alternate Base Rate.
"Applicable Percentage" means for any day, the rate per annum set forth
below opposite the applicable rating for the Borrower's senior unsecured
(non-credit enhanced) long term debt as determined by S&P and Moody's (the "Debt
Rating") then in effect, it being understood that the Applicable Percentage for
(i) Alternate Base Rate Loans shall be the percentage set forth under the column
"Alternate Base Rate Margin", (ii) LIBOR Rate Loans shall be the percentage set
forth under the column "LIBOR Margin", (iii) the Facility Fee shall be the
percentage set forth under the column "Facility Fee" and (iv) the Utilization
Fee shall be the percentage set forth under the column "Utilization Fee":
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Alternate
Pricing S&P Moody's LIBOR Base Rate Facility Utilization
Level Rating Rating Margin Margin Fee Fee
----- ------ ------ ------ ------ --- ---
I BBB+ or higher Baa1 or higher 0.525% 0% 0.100% 0.125%
II BBB Baa2 0.625% 0% 0.125% 0.125%
III BBB- Baa3 0.925% 0% 0.200% 0.125%
IV BB+ Ba1 1.125% 0% 0.250% 0.125%
V BB+ or lower Ba1 or lower 1.250% 0% 0.375% 0.125%
Any change in the Applicable Percentage due to a change in the Debt
Rating shall be effective on the date on which such change is announced publicly
by S&P and/or Moody's, as applicable, or otherwise becomes effective. The
Borrower shall be obligated to provide notice to the Administrative Agent and
the Lenders of any change in the Debt Rating in accordance with Section 6.3(d).
The initial Applicable Percentage shall be set at no lower than Pricing Level
III and shall not be adjusted to a higher Pricing Level (that is, Pricing Level
I or Pricing Level II) until the end of the first two complete fiscal quarters
following the Closing Date. Adjustment in the Applicable Percentage shall be
effective as to all Loans, existing and prospective, from the date of
adjustment. The Administrative Agent shall promptly notify the Lenders of
changes in the Applicable Percentage.
If (a) only one of S&P and Moody's at any time of determination shall
have in effect a Debt Rating, the Applicable Percentage shall be determined by
reference to the available rating, (b) neither S&P nor Moody's at any time of
determination shall have in effect a Debt Rating, the Applicable Percentage will
be set in accordance with Pricing Level V, (c) there shall be a one Pricing
Level difference between the ratings established by S&P and Moody's, the
Applicable Percentage shall be based upon the lower rating, (d) there shall be a
greater than one Pricing Level difference between the ratings established by S&P
and Moody's, the Applicable Percentage shall be based upon the Pricing Level
immediately above the lower rating and (e) S&P or Moody's shall change the basis
on which ratings are established, each reference to the Debt Rating announced by
S&P or Moody's, as the case may be, shall refer to the then equivalent rating by
S&P or Moody's, as the case may be.
"Arranger" means First Union Securities, Inc., d/b/a Wachovia
Securities, together with its successors and assigns.
"Attributed Principal Amount" means, on any day, with respect to any
Permitted Receivables Financing entered into by any Credit Party, the aggregate
amount (with respect to any such transaction, the "Invested Amount") paid to, or
borrowed by, such Person as of such date under such Permitted Receivables
Financing, minus the aggregate amount received by the applicable Receivables
Financier and applied to the reduction of the Invested Amount under such
Permitted Receivables Financing.
"Average Outstanding Loans" means, for any Utilization Period, the sum
of (i) the aggregate principal amount of Loans outstanding under this Credit
Agreement, plus (ii) the aggregate principal amount of loans outstanding under
the Three Year Credit Agreement, as of the end of each day during such
Utilization Period, divided by the number of days in such Utilization Period.
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"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United
States Code, as amended, modified, succeeded or replaced from time to time.
"Borrower" means The Dial Corporation, a Delaware corporation, as
referenced in the opening paragraph, its successors and permitted assigns.
"Business Day" means any day other than a Saturday, Sunday or legal
holiday on which commercial banks are open for business in Xxxxxxxxx, Xxxxx
Xxxxxxxx xxx Xxx Xxxx, Xxx Xxxx; except that when used in connection with a
LIBOR Rate Loan, such day shall also be a day on which dealings between banks
are carried on in London, England in deposits of Dollars.
"Capital Lease" means, as applied to any Person, any lease of any
Property (whether real, personal or mixed) by that Person as lessee which, in
accordance with GAAP, is or should be accounted for as a capital lease on the
balance sheet of that Person.
"Capital Stock" means (i) in the case of a corporation, capital stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
capital stock, (iii) in the case of a partnership, partnership interests
(whether general or limited), (iv) in the case of a limited liability company,
membership interests and (v) any other interest or participation that confers on
a Person the right to receive a share of the profits and losses of, or
distribution of assets of, the issuing Person.
"Cash Equivalents" shall mean (i) securities issued or directly and
fully guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than twelve months from the date of acquisition ("Government Obligations"), (ii)
U.S. dollar denominated (or foreign currency fully hedged) time deposits,
certificates of deposit, Eurodollar time deposits and Eurodollar certificates of
deposit of (y) any domestic commercial bank of recognized standing having
capital and surplus in excess of $250,000,000 or (z) any bank whose short-term
commercial paper rating from S&P is at least A-1 or the equivalent thereof or
from Xxxxx'x is at least P-1 or the equivalent thereof (any such bank being an
"Approved Bank"), in each case with maturities of not more than 364 days from
the date of acquisition, (iii) commercial paper and variable or fixed rate notes
issued by any Approved Bank (or by the parent company thereof) or any variable
rate notes issued by, or guaranteed by any domestic corporation rated A-1 (or
the equivalent thereof) or better by S&P or P-1 (or the equivalent thereof) or
better by Moody's and maturing within six months of the date of acquisition,
(iv) repurchase agreements with a bank or trust company (including a Lender) or
a recognized securities dealer having capital and surplus in excess of
$500,000,000 for direct obligations issued by or fully guaranteed by the United
States of America, (v) obligations of any state of the United States or any
political subdivision thereof for the payment of the principal and redemption
price of and interest on which there shall have been irrevocably deposited
Government Obligations maturing as to principal and interest at times and in
amounts sufficient to provide such payment, and (vi) auction preferred stock
rated in the highest short-term credit rating category by S&P or Moody's.
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"Change of Control" means (a) any Person or two or more Persons acting
in concert shall have acquired "beneficial ownership," directly or indirectly,
of, or shall have acquired by contract or otherwise, or shall have entered into
a contract or arrangement that, upon consummation, will result in its or their
acquisition of, or control over, Voting Stock of the Borrower (or other
securities convertible into such Voting Stock) representing 40% or more of the
combined voting power of all Voting Stock of the Borrower, or (b) Continuing
Directors shall cease for any reason to constitute a majority of the members of
the board of directors of the Borrower then in office. As used herein,
"beneficial ownership" shall have the meaning provided in Rule 13d-3 of the
Securities and Exchange Commission under the Securities Act of 1934.
"Closing Date" means the date hereof.
"Code" means the Internal Revenue Code of 1986, as amended, and any
successor statute thereto, as interpreted by the rules and regulations issued
thereunder, in each case as in effect from time to time. References to sections
of the Code shall be construed also to refer to any successor sections.
"Commitment" means, with respect to each Lender, the commitment of such
Lender to make Revolving Loans in an aggregate principal amount at any time
outstanding of up to such Lender's Revolving Committed Amount as specified in
Schedule 2.1(a), as such amount may be reduced from time to time in accordance
with the provisions hereof.
"Commitment Percentage" means, for each Lender, a fraction (expressed
as a decimal) the numerator of which is the Commitment of such Lender at such
time and the denominator of which is the Aggregate Revolving Committed Amount at
such time. The initial Commitment Percentages are set out on Schedule 2.1(a).
"Commitment Period" means the period from and including the Closing
Date to but not including the earlier of (i) the Termination Date, or (ii) the
date on which the Commitments terminate in accordance with the provisions of
this Credit Agreement.
"Commonly Controlled Entity" means an entity, whether or not
incorporated, which is under common control with the Borrower within the meaning
of Section 4001 of ERISA or is part of a group which includes the Borrower and
which is treated as a single employer under Section 414 of the Code.
"Consolidated EBITDA" means, for the applicable period, the sum of (i)
Consolidated Net Income for such period, plus (ii) the interest expense for such
period (including, without limitation, the interest component of payments under
Capital Leases) deducted in determining Consolidated Net Income, plus (iii) the
income tax expense for such period deducted in determining Consolidated Net
Income, plus (iv) the aggregate amount of the depreciation expense and
amortization expense for such period to the extent deducted in determining
Consolidated Net Income, minus (v) any extraordinary, unusual or nonrecurring
items of gain (or plus any extraordinary, unusual or nonrecurring items of loss)
included in Consolidated Net Income for such period, in each case determined for
the Borrower and its Subsidiaries on a consolidated basis; provided that to the
extent that one or more acquisitions or dispositions
5
occurred during such period, Consolidated EBITDA shall be calculated as if such
acquisition or disposition occurred on the first day of such period (on a pro
forma basis for the portion of such period prior to the date of such acquisition
(or after the date of such disposition) and on an actual basis for the portion
of such period after the date of such acquisition (or before the date of such
disposition)).
"Consolidated Funded Debt" means Funded Debt of the Borrower and its
Subsidiaries on a consolidated basis.
"Consolidated Interest Expense" means, for the applicable period, all
interest expense (including the interest component under Capital Leases and the
implied interest component under Permitted Receivables Financings) of the
Borrower and its Subsidiaries for such period, as determined in accordance with
GAAP. Unless expressly indicated otherwise, the applicable period shall be for
the four consecutive quarters ending as of the date of computation.
"Consolidated Net Income" means, for the applicable period, net income
of the Borrower and its Subsidiaries on a consolidated basis. Unless expressly
indicated otherwise, the applicable period shall be for the four consecutive
quarters ending on the date of computation.
"Consolidated Net Worth" means, as of any date of computation, the sum
of (i) consolidated stockholders' equity of the Borrower and its Subsidiaries
(calculated without giving effect to (a) translation gains or losses relating to
foreign currency rates, (b) gains or losses relating to the sale of assets
attributable to, or other disposition of, the Borrower's Argentinean operations
and (c) gains or losses attributable to the sale of the Armour food business of
the Borrower) plus (ii) an amount not to exceed $45,000,000 resulting from the
impairment charge relating to the Borrower's Argentinean operations.
"Consolidated Total Tangible Assets" means, on the date of computation,
(i) consolidated total assets minus (ii) goodwill minus (iii) other items
properly classified as "intangible assets," in each case determined for the
Borrower and its Subsidiaries on a consolidated basis.
"Continuing Directors" means, during any period of up to 24 consecutive
months commencing after the Closing Date, individuals who at the beginning of
such 24 month period were directors of the Borrower (together with any new
director whose election by the Borrower's board of directors or whose nomination
for election by the Borrower's shareholders was approved by a vote of at least
two-thirds of the directors then still in office who either were directors at
the beginning of such period or whose election or nomination for election was
previously so approved).
"Credit Documents" means a collective reference to this Credit
Agreement, the 3 Year Credit Agreement, the Notes, any Joinder Agreement, the
Fee Letter and all other related agreements and documents issued or delivered
hereunder or thereunder or pursuant hereto or thereto.
"Credit Party" means any of the Borrower or the Guarantors.
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"Credit Party Obligations" means, without duplication, (i) all of the
obligations of the Credit Parties to the Lenders and the Administrative Agent,
whenever arising, under this Credit Agreement, the Notes or any of the other
Credit Documents (including, but not limited to, any interest accruing after the
occurrence of a filing of a petition of bankruptcy under the Bankruptcy Code
with respect to any Credit Party, regardless of whether such interest is an
allowed claim under the Bankruptcy Code) and (ii) all liabilities and
obligations, whenever arising, owing from any Credit Party or any of its
Subsidiaries to any Lender, or any Affiliate of a Lender, arising under any
Hedging Agreement.
"Debt Rating" shall have the meaning assigned to such term in the
definition of "Applicable Percentage."
"Default" means any event, act or condition which with notice or lapse
of time, or both, would constitute an Event of Default.
"Defaulting Lender" means, at any time, any Lender that, at such time,
(i) has failed to make a Loan required pursuant to the terms of this Credit
Agreement, (ii) has failed to pay to the Administrative Agent or any Lender an
amount owed by such Lender pursuant to the terms of the Credit Agreement or any
other of the Credit Documents, or (iii) has been deemed insolvent or has become
subject to a bankruptcy or insolvency proceeding or to a receiver, trustee or
similar proceeding.
"Dollars" and "$" means dollars in lawful currency of the United States
of America.
"Domestic Subsidiary" means any Subsidiary that is organized and
existing under the laws of the United States or any state or commonwealth
thereof or under the laws of the District of Columbia.
"Environmental Laws" means any and all applicable foreign, federal,
state, local or municipal laws, rules, orders, regulations, statutes,
ordinances, codes, decrees, requirements or any Governmental Authority or other
Requirement of Law (including common law) regulating, relating to or imposing
liability or standards of conduct concerning protection of human health or the
environment, as now or may at any time be in effect during the term of this
Credit Agreement.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto, as interpreted by the rules and
regulations thereunder, all as the same may be in effect from time to time.
References to sections of ERISA shall be construed also to refer to any
successor sections.
"Eurodollar Reserve Percentage" means for any day, the percentage
(expressed as a decimal and rounded upwards, if necessary, to the next higher
1/100th of 1%) which is in effect for such day as prescribed by the Federal
Reserve Board (or any successor) for determining the maximum reserve requirement
(including without limitation any basic, supplemental or emergency reserves) in
respect of Eurocurrency liabilities, as defined in Regulation D of such
7
Board as in effect from time to time, or any similar category of liabilities for
a member bank of the Federal Reserve System in New York City.
"Event of Default" means such term as defined in Section 8.1.
"Extension Consent" shall have the meaning ascribed thereto in Section
2.1(g).
"Extension Consent Date" shall have the meaning ascribed thereto in
Section 2.1(g).
"Extension Request" shall have the meaning ascribed thereto in Section
2.1(g).
"Fee Letter" means that certain letter agreement, dated as of January
23, 2002, among First Union, the Arranger and the Borrower, as amended,
modified, supplemented or replaced from time to time.
"Fees" means all fees payable pursuant to Section 3.5.
"Federal Funds Rate" means, for any day, the rate of interest per annum
(rounded upwards, if necessary, to the nearest whole multiple of 1/100 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 Business Day next succeeding such day, provided that (A) if such day is
not a Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day and (B) if no such rate is
so published on such next preceding Business Day, the Federal Funds Rate for
such day shall be the average rate quoted to the Administrative Agent on such
day on such transactions as reasonably determined by the Administrative Agent.
"First Union" means First Union National Bank and its successors.
"Foreign Subsidiary" means any Subsidiary that is not a Domestic
Subsidiary.
"Funded Debt" means, with respect to any Person, without duplication,
(a) all obligations of such Person for borrowed money, (b) all obligations of
such Person evidenced by bonds, debentures, notes or similar instruments, or
upon which interest payments are customarily made, (c) all obligations of such
Person under conditional sale or other title retention agreements relating to
property purchased by such Person (other than customary reservations or
retentions of title under agreements with suppliers entered into in the ordinary
course of business), (d) all obligations of such Person incurred, issued or
assumed as the deferred purchase price of property or services purchased by such
Person (other than trade debt incurred in the ordinary course of business and
due within six months of the incurrence thereof) which would appear as
liabilities on a balance sheet of such Person, (e) the principal portion of all
obligations of such Person under Capital Leases, (f) all obligations of such
Person under Hedging Agreements, excluding any portion thereof which would be
accounted for as interest expense under GAAP or for which hedge accounting under
GAAP is applicable, (g) the maximum amount of all standby letters of credit
issued for the account of such Person and, without duplication, all drafts drawn
thereunder (to the extent unreimbursed), (h) all
8
preferred Capital Stock issued by such Person and which by the terms thereof
could be (at the request of the holders thereof or otherwise) subject to
mandatory sinking fund payments, redemption or other acceleration, (i) the
principal balance outstanding under any synthetic lease, tax retention operating
lease, off-balance sheet loan or similar off-balance sheet financing product,
including, without limitation, the outstanding Attributed Principal Amount under
any Permitted Receivables Financing, but excluding customary operating leases in
the ordinary course of business, (j) all Indebtedness of others of the type
described in clauses (a) through (i) hereof secured by (or for which the holder
of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on, or payable out of the proceeds of production from,
property owned or acquired by such Person, whether or not the obligations
secured thereby have been assumed, (k) all Guaranty Obligations of such Person
with respect to Indebtedness of another Person of the type described in clauses
(a) through (i) hereof, and (l) all Indebtedness of the type described in
clauses (a) through (i) hereof of any partnership or unincorporated joint
venture in which such Person is a general partner or a joint venturer; provided,
however, that Funded Debt shall not include Indebtedness among the Credit
Parties to the extent such Indebtedness would be eliminated on a Consolidated
basis.
"GAAP" means generally accepted accounting principles in the United
States applied on a consistent basis and subject to the terms of Section 1.3
hereof.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Guarantors" means (a) any of the Domestic Subsidiaries identified as a
"Guarantor" on the signature pages hereto and (b) any Person which executes a
Joinder Agreement, together with their successors and permitted assigns.
"Guaranty" means the guaranty of the Guarantors set forth in Section
11.
"Guaranty Obligations" means, with respect to any Person, without
duplication, any obligations of such Person (other than endorsements in the
ordinary course of business of negotiable instruments for deposit or collection)
guaranteeing or intended to guarantee any Indebtedness of any other Person in
any manner, whether direct or indirect, and including without limitation any
obligation, whether or not contingent, (i) to purchase any such Indebtedness or
any property constituting security therefor, (ii) to advance or provide funds or
other support for the payment or purchase of any such Indebtedness or to
maintain working capital, solvency or other balance sheet condition of such
other Person (including without limitation keep well agreements, maintenance
agreements, comfort letters or similar agreements or arrangements) for the
benefit of any holder of Indebtedness of such other Person, (iii) to lease or
purchase Property, securities or services primarily for the purpose of assuring
the holder of such Indebtedness, or (iv) to otherwise assure or hold harmless
the holder of such Indebtedness against loss in respect thereof. The amount of
any Guaranty Obligation hereunder shall (subject to any limitations set forth
therein) be deemed to be an amount equal to the outstanding principal amount (or
maximum principal amount, if larger) of the Indebtedness in respect of which
such Guaranty Obligation is made.
9
"Hedging Agreements" means, with respect to any Person, any agreement
entered into to protect such Person against fluctuations in interest rates, or
currency or raw materials values, including, without limitation, any interest
rate swap, cap or collar agreement or similar arrangement between such Person
and one or more counterparties, any foreign currency exchange agreement,
currency protection agreements, commodity purchase or option agreements or other
interest or exchange rate or commodity price hedging agreements.
"Indebtedness" means, with respect to any Person, without duplication,
(a) all obligations of such Person for borrowed money, (b) all obligations of
such Person evidenced by bonds, debentures, notes or similar instruments, or
upon which interest payments are customarily made, (c) all obligations of such
Person under conditional sale or other title retention agreements relating to
property purchased by such Person (other than customary reservations or
retentions of title under agreements with suppliers entered into in the ordinary
course of business), (d) all obligations of such Person issued or assumed as the
deferred purchase price of property or services purchased by such Person (other
than trade debt incurred in the ordinary course of business and due within six
months of the incurrence thereof) which would appear as liabilities on a balance
sheet of such Person, (e) all obligations of such Person under take-or-pay or
similar arrangements or under commodities agreements, (f) all Indebtedness of
others secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on, or payable out of
the proceeds of production from, property owned or acquired by such Person,
whether or not the obligations secured thereby have been assumed, (g) all
Guaranty Obligations of such Person with respect to Indebtedness of another
Person, (h) the principal portion of all obligations of such Person under
Capital Leases plus any accrued interest thereon, (i) all obligations of such
Person under Hedging Agreements, excluding any portion thereof which would be
accounted for as interest expense under GAAP or for which hedge accounting under
GAAP is applicable, (j) the maximum amount of all standby letters of credit
issued for the account of such Person and, without duplication, all drafts drawn
thereunder (to the extent unreimbursed), (k) all preferred Capital Stock issued
by such Person and which by the terms thereof could be (at the request of the
holders thereof or otherwise) subject to mandatory sinking fund payments,
redemption or other acceleration, (l) the principal balance outstanding under
any synthetic lease, tax retention operating lease, off-balance sheet loan or
similar off-balance sheet financing product plus any accrued interest thereon,
but excluding customary operating leases in the ordinary course of business and
(m) the Indebtedness of any partnership or unincorporated joint venture in which
such Person is a general partner or a joint venturer.
"Insolvency" means, with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of such term as used in
Section 4245 of ERISA.
"Interest Coverage Ratio" means, for the applicable period, the ratio
of (i) Consolidated EBITDA for such period to (ii) Consolidated Interest Expense
paid or payable in cash during such period. Unless expressly indicated
otherwise, the applicable period shall be for the four consecutive quarters
ending on the date of computation.
"Interest Payment Date" means (a) as to any Alternate Base Rate Loan,
the last day of each March, June, September and December and on the Termination
Date, (b) as to any LIBOR Rate Loan having an Interest Period of three months or
less, the last day of such Interest Period,
10
and (c) as to any LIBOR Rate Loan having an Interest Period longer than three
months, each day which is three months after the first day of such Interest
Period and the last day of such Interest Period.
"Interest Period" means, as to any LIBOR Rate Loan, a period of one,
two, three or six month's duration, as the Borrower may elect, commencing in
each case, on the date of the borrowing (including conversions, extensions and
renewals); provided, however, (A) if any Interest Period would end on a day
which is not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day (except that where the next succeeding Business Day
falls in the next succeeding calendar month, then on the next preceding Business
Day), (B) no Interest Period shall extend beyond the Termination Date, and (C)
where an Interest Period begins on a day for which there is no numerically
corresponding day in the calendar month in which the Interest Period is to end,
such Interest Period shall end on the last Business Day of such calendar month.
"Invested Amount" shall have the meaning set forth in the definition of
Attributed Principal Amount.
"Investment" means all investments, in cash or by delivery of property
made, directly or indirectly in, to or from any Person, whether by acquisition
of shares of Capital Stock, property, assets, indebtedness or other obligations
or securities or by loan advance, capital contribution or otherwise.
"Joinder Agreement" means a Joinder Agreement in substantially the form
of Schedule 6.9, executed and delivered by each Person required to become a
Guarantor in accordance with the provisions of Section 6.9.
"Lenders" means each of the Persons identified as a "Lender" on the
signature pages hereto, and their successors and assigns.
"Leverage Ratio" means the ratio of Consolidated Funded Debt on the
date of computation to Consolidated EBITDA for the applicable period ending on
the date of computation. Unless expressly indicated otherwise, the applicable
period shall be for the four consecutive quarters ending on the date of
computation.
"LIBOR" means, for any LIBOR Rate Loan for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as the
London interbank offered rate for deposits in Dollars at approximately 11:00
a.m. (London time) two Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period. If for any reason such
rate is not available, the term "LIBOR" shall mean, for any LIBOR Rate Loan for
any Interest Period therefor, the rate per annum (rounded upwards, if necessary,
to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as the London
interbank offered rate for deposits in Dollars at approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such Interest Period
for a term comparable to such Interest Period; provided, however, if more than
one rate is specified on Reuters Screen LIBO Page, the applicable rate shall be
the arithmetic mean of all such rates
11
(rounded upwards, if necessary, to the nearest 1/100 of 1%). If, for any reason,
neither of such rates is available, then "LIBOR" shall mean the rate per annum
at which, as determined by the Administrative Agent, Dollars in an amount
comparable to the Loans then requested are being offered to leading banks at
approximately 11:00 A.M. London time, two (2) Business Days prior to the
commencement of the applicable Interest Period for settlement in immediately
available funds by leading banks in the London interbank market for a period
equal to the Interest Period selected.
"LIBOR Lending Office" means, initially, the office of each Lender
designated as such Lender's LIBOR Lending Office shown on Schedule 10.2; and
thereafter, such other office of such Lender as such Lender may from time to
time specify to the Administrative Agent and the Borrower as the office of such
Lender at which the LIBOR Rate Loans of such Lender are to be made.
"LIBOR Rate" means a rate per annum (rounded upwards, if necessary, to
the next higher 1/100th of 1%) determined by the Administrative Agent pursuant
to the following formula:
LIBOR Rate = LIBOR
---------------------------------------------
1.00 - Eurodollar Reserve Percentage
"LIBOR Rate Loan" means any Loan bearing interest at a rate determined
by reference to the LIBOR Rate.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, security interest, encumbrance, lien (statutory or otherwise),
preference, priority or charge of any kind (including any conditional sale or
other title retention agreement, any financing or similar statement or notice
filed under the Uniform Commercial Code as adopted and in effect in the relevant
jurisdiction or other similar recording or notice statute, and any lease in the
nature thereof).
"Loan" or "Loans" means any Revolving Loan.
"Material Adverse Effect" means a material adverse effect on (a) the
business, assets or liabilities (financial or otherwise) of the Credit Parties
and their Subsidiaries taken as a whole, (b) the ability of the Borrower or any
Guarantor to perform its obligations, when such obligations are required to be
performed, under this Credit Agreement, any of the Notes or any other Credit
Document or (c) the validity or enforceability of this Credit Agreement, any of
the Notes or any of the other Credit Documents or the material rights or
remedies of the Administrative Agent or the Lenders hereunder or thereunder.
"Material Contract" means any contract or other arrangement, whether
written or oral, to which the Borrower or any of its Subsidiaries is a party as
to which contract the breach, nonperformance or cancellation of such contract by
any party thereto could reasonably be expected to have a Material Adverse
Effect.
12
"Material Domestic Subsidiary" means any Domestic Subsidiary which owns
operating assets as of the Closing Date or as of the end of the most recent
fiscal year thereafter in excess of five percent (5%) of the Consolidated Total
Tangible Assets. In making the foregoing determination, the percentage ownership
interest in a Subsidiary held by the Borrower or any of its Subsidiaries shall
be applied to the value of operating assets held by such Subsidiary and the
resulting value shall be used to determine the percentage of the Consolidated
Total Tangible Assets held by such Subsidiary.
"Materials of Environmental Concern" means any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials, or wastes, defined or regulated as
such in or under any Environmental Law, including, without limitation, asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.
"Moody's" means Xxxxx'x Investors Service, Inc., or any successor or
assignee of the business of such company in the business of rating securities.
"Multiemployer Plan" means a Plan which is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan which the Borrower, any
Subsidiary of the Borrower or any ERISA Affiliate and at least one employer
other than the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate
are contributing sponsors.
"New Commitment Agreement" has the meaning assigned to such term in
Section 3.4(c).
"Non-Excluded Taxes" means such term as is defined in Section 3.13.
"Note" or "Notes" means any Revolving Note.
"Notice of Borrowing" means a written notice of borrowing in
substantially the form of Schedule 2.1(b)(i), as required by Section 2.1(b)(i).
"Notice of Extension/Conversion" means the written notice of extension
or conversion in substantially the form of Schedule 3.2, as required by Section
3.2.
"Participant" shall have the meaning set forth in Section 10.6(b).
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA.
"Permitted Acquisition" means any acquisition or any series of related
acquisitions by a Credit Party of the assets or a majority of the Voting Stock
of a Person that is incorporated, formed or organized in the United States, or
any division, line of business or other business unit of a Person that is
incorporated, formed or organized in the United States (such Person or such
division, line of business or other business unit of such Person referred to
herein as the "Target"), in each case that is a type of business (or assets used
in a type of business) permitted to be
13
engaged in by the Credit Parties and their Subsidiaries pursuant to Section 7.3
hereof, so long as (a) no Default or Event of Default shall then exist or would
exist after giving effect thereto, (b) the Credit Parties certify to the
Administrative Agent and the Required Lenders that the Credit Parties will be in
compliance on a Pro Forma Basis with all of the terms and provisions of the
financial covenants set forth in Section 6.7, (c) the Target, if such Person
would be a Material Domestic Subsidiary, shall have executed a Joinder Agreement
in accordance with the terms of Section 6.9, (d) if total consideration for such
Acquisition is greater than $50,000,000, the Target has earnings before
interest, taxes, depreciation and amortization for the most recent four fiscal
quarters prior to the acquisition date for which financial statements are
available, together with adjustments agreed to by the Borrower and the
Administrative Agent, in an amount greater than $0 and (e) such acquisition is
not a "hostile" acquisition and has been approved by the Board of Directors
and/or shareholders of the applicable Credit Party and the Target.
"Permitted Investments" means:
(i) cash and Cash Equivalents;
(ii) receivables owing to the Borrower or any of its
Subsidiaries or any receivables and advances to suppliers, in each case
if created, acquired or made in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms;
(iii) Investments in and loans by any Credit Party to any
other Credit Party;
(iv) loans and advances to officers, directors and employees
in the ordinary course of business in an aggregate amount not to exceed
$5,000,000 at any time outstanding;
(v) Investments (including debt obligations) received in
connection with the bankruptcy or reorganization of suppliers and
customers and in settlement of delinquent obligations of, and other
disputes with, customers and suppliers arising in the ordinary course
of business;
(vi) Investments, acquisitions or transactions permitted under
Section 7.4(b);
(vii) Permitted Acquisitions;
(viii) Investments by any Credit Party in a Receivables
Financing SPC made in connection with a Permitted Receivables
Financing;
(ix) Investments existing as of the Closing Date and set forth
on Schedule 7.5 hereto (including, without limitation, the intercompany
loan to Dial Argentina, S.A. which may be converted into equity after
the Closing Date); and
(x) additional loan advances and/or Investments of a nature
not contemplated by the foregoing clauses hereof; provided that such
loans, advances and/or Investments
14
made pursuant to this clause (x) shall not exceed an aggregate amount
of $25,000,000 at any time outstanding.
"Permitted Liens" means:
(i) Liens in favor of a Lender hereunder in connection with
Hedging Agreements permitted under Section 7.1(e), but only to the
extent such Liens (A) secure obligations under Hedging Agreements with
any Lender or any Affiliate of a Lender and (B) relate only to
collateral which equally and ratably secures the Loans and other Credit
Party Obligations in favor of the Lenders hereunder;
(ii) Liens securing purchase money Indebtedness and Capital
Lease Obligations to the extent permitted under Section 7.1(c);
provided, that (A) any such Lien attaches to such property concurrently
with or within 30 days after the acquisition thereof and (B) such Lien
attaches solely to the property so acquired in such transaction;
(iii) Liens for taxes, assessments, charges or other
governmental levies not yet due or as to which the period of grace (not
to exceed 60 days), if any, related thereto has not expired or which
are being contested in good faith by appropriate proceedings, provided
that adequate reserves with respect thereto are maintained on the books
of the Borrower or its Subsidiaries, as the case may be, in conformity
with GAAP;
(iv) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of
business which are not overdue for a period of more than 60 days or
which are being contested in good faith by appropriate proceedings;
(v) pledges or deposits in connection with workers'
compensation, unemployment insurance and other social security
legislation and deposits securing liability to insurance carriers under
insurance or self-insurance arrangements incurred in the ordinary
course of business;
(vi) deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases, statutory
obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of
business;
(vii) Liens existing on the Closing Date and set forth on
Schedule 1.1-2; provided that (a) no such Lien shall at any time be
extended to cover property or assets other than the property or assets
subject thereto on the Closing Date and (b) the principal amount of the
Indebtedness secured by such Liens shall not be extended, renewed,
refunded or refinanced;
(viii) easements, rights-of-way, restrictions (including
zoning restrictions), minor defects or irregularities in title and
other similar charges or encumbrances not, in any material respect,
impairing the use of the encumbered Property for its intended purposes;
15
(ix) any extension, renewal or replacement (or successive
extensions, renewals or replacements), in whole or in part, of any Lien
referred to in the foregoing clauses; provided that such extension,
renewal or replacement Lien shall be limited to all or a part of the
property which secured the Lien so extended, renewed or replaced; and
(x) other Liens not described above, provided that such Liens
do not secure obligations in excess of $25,000,000 at any one time
outstanding.
"Permitted Receivables Financing" shall mean any one or more
receivables financings in which (a) any Credit Party (i) sells (as determined in
accordance with GAAP) any accounts receivable, notes receivable, rights to
future lease payments or residuals (collectively, together with certain property
relating thereto and the right to collections thereon, being the "Transferred
Assets") to any Person that is not a Subsidiary or Affiliate of the Borrower
(with respect to any such transaction, the "Receivables Financier"), (ii)
borrows from such Receivables Financier and secures such borrowings by a pledge
of such Transferred Assets and/or (iii) otherwise finances its acquisition of
such Transferred Assets and, in connection therewith, conveys an interest in
such Transferred Assets to the Receivables Financier or (b) any Credit Party
sells, conveys or otherwise contributes any Transferred Assets to a Receivables
Financing SPC, which Receivables Financing SPC then (i) sells (as determined in
accordance with GAAP) any such receivables (or an interest therein) to any
Receivables Financier, (ii) borrows from such Receivables Financier and secures
such borrowings by a pledge of such receivables or (iii) otherwise finances its
acquisition of such receivables and, in connection therewith, conveys an
interest in such receivables to the Receivables Financier, provided that (A) the
aggregate Attributed Principal Amount for all such receivables financings shall
not at any time exceed $100,000,000, (B) such receivables financing shall not
involve any recourse to any Credit Party for any reason other than (x)
repurchases of non-eligible receivables or (y) indemnifications for losses other
than credit losses related to the receivables sold in such financing and (C) the
terms of such transaction, including the discount at which receivables are sold,
the term of the commitment of the Receivables Financier thereunder and any
termination events, shall be consistent at all times with those prevailing in
the market for similar transactions involving a receivables originator/servicer
of similar credit quality and a receivables pool of similar characteristics.
"Person" means any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other enterprise
(whether or not incorporated) or any Governmental Authority.
"Plan" means, at any particular time, any employee benefit plan which
is covered by Title IV of ERISA and in respect of which the Borrower or a
Commonly Controlled Entity is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA.
"Prime Rate" means the rate of interest per annum publicly announced
from time to time by First Union as its prime rate in effect at its principal
office in Charlotte, North Carolina, with each change in the Prime Rate being
effective on the date such change is publicly announced as effective (it being
understood and agreed that the Prime Rate is a reference rate used by First
16
Union in determining interest rates on certain loans and is not intended to be
the lowest rate of interest charged on any extension of credit by First Union to
any debtor).
"Pro Forma Basis" shall mean, with respect to any Permitted
Acquisition, that such Permitted Acquisition shall be deemed to have occurred as
of the first day of the twelve-month period ending as of the most recent month
end preceding the date of such Permitted Acquisition.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Purchasing Lenders" shall have the meaning set forth in Section
10.6(c).
"Receivables Financier" shall have the meaning set forth in the
definition of Permitted Receivables Financing.
"Receivables Financing SPC" shall mean, in respect of any Permitted
Receivables Financing, any Subsidiary or Affiliate of the Borrower to which any
Credit Party sells, contributes or otherwise conveys any Transferred Assets in
connection with such Permitted Receivables Financing.
"Recovery Event" shall mean the receipt by the Borrower or any of its
Subsidiaries of any cash insurance proceeds or condemnation award payable by
reason of theft, loss, physical destruction or damage, taking or similar event
with respect to any of their respective property or assets.
"Register" shall have the meaning given such term in Section 10.6(d).
"Regulation T, U, or X" means Regulation T, U or X, respectively, of
the Board of Governors of the Federal Reserve System as from time to time in
effect and any successor to all or a portion thereof.
"Reorganization" means, with respect to any Multiemployer Plan, the
condition that such Plan is in reorganization within the meaning of such term as
used in Section 4241 of ERISA.
"Related Fund" means, with respect to any Lender, any fund or trust or
entity that invests in commercial bank loans in the ordinary course of business
and is advised or managed by (i) such Lender, (ii) an Affiliate of such Lender,
(iii) any other Lender or any Affiliate thereof or (iv) the same investment
advisor as any Person described in clauses (i) - (iii).
"Reportable Event" means any of the events set forth in Section 4043(c)
of ERISA, other than those events as to which the thirty-day notice period is
waived under PBGC Reg. Section 4043.
"Required Lenders" means, at any time, Lenders having more than
fifty-one percent (51%) of the Commitments, or if the Commitments have been
terminated, Lenders having more than fifty-one percent (51%) of the aggregate
principal amount of Loans outstanding; provided
17
that the Commitments of, and outstanding principal amount of Loans owing to, a
Defaulting Lender shall be excluded for purposes hereof in making a
determination of Required Lenders.
"Requirement of Law" means, as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its material property is subject.
"Responsible Officer" means, with respect to the Borrower, the Chief
Executive Officer, Chief Financial Officer, the Controller and the Treasurer.
"Restricted Payment" shall mean (a) any dividend or other distribution,
direct or indirect, on account of any shares of any class of Capital Stock of
the Borrower or any of its Subsidiaries, now or hereafter outstanding, (b) any
payment or prepayment of principal of, premium, if any, or interest on,
redemption, purchase, retirement, defeasance, sinking fund or similar payment
with respect to, any Subordinated Indebtedness or (c) the payment by the
Borrower or any of its Subsidiaries of any management or consulting fee to any
Person or of any salary, bonus or other form of compensation to any Person who
is directly or indirectly a significant partner, shareholder, owner or executive
officer of any such Person, to the extent such salary, bonus or other form of
compensation is not included in the corporate overhead of the Borrower or such
Subsidiary.
"Revolving Committed Amount" means, collectively, the aggregate amount
of all of the Commitments and, individually, the amount of each Lender's
Commitment as specified in Schedule 2.1(a).
"Revolving Loans" shall have the meaning assigned to such term in
Section 2.1(a).
"Revolving Note" or "Revolving Notes" means the promissory notes of the
Borrower in favor of each of the Lenders evidencing the Revolving Loans in
substantially the form attached as Schedule 2.1(e), individually or
collectively, as appropriate, as such promissory notes may be amended, modified,
supplemented, extended, renewed or replaced from time to time.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill,
Inc., or any successor or assignee of the business of such division in the
business of rating securities.
"Single Employer Plan" means any Plan which is not a Multiemployer
Plan.
"Specified Sales" means (a) the sale, transfer, lease or other
disposition of inventory and materials in the ordinary course of business and
(b) the sale, transfer or other disposition of Permitted Investments.
"Subordinated Indebtedness" shall mean any Indebtedness incurred by any
Credit Party that by its terms is specifically subordinated in right of payment
to the prior payment of the Credit Party Obligations.
18
"Subsidiary" means, as to any Person, a corporation, partnership,
limited liability company or other entity of which shares of stock or other
ownership interests having ordinary voting power to elect a majority of the
directors or other managers of such corporation, partnership, limited liability
company or other entity (irrespective of whether or not at the time, any class
or classes of such corporation shall have or might have voting power by reason
of the happening of any contingency) are at the time owned by such Person
directly or indirectly through Subsidiaries. Unless otherwise identified,
"Subsidiary" or "Subsidiaries" shall mean Subsidiaries of the Borrower.
"Target" shall have the meaning set forth in the definition of
Permitted Acquisition.
"Taxes" shall have the meaning set forth in Section 3.13.
"Termination Date" means, as to each Lender, the date 364 days
following the Closing Date, or if extended with the written consent of such
Lender, such later date not more than 364 days following the then applicable
Termination Date.
"Three Year Credit Agreement" means that certain Three Year Credit
Agreement dated as of the date hereof among the Borrower, the Guarantors
identified therein, the Lenders identified therein and First Union, as
Administrative Agent, as amended, modified, supplemented, extended or restated
from time to time.
"Transfer Effective Date" shall have the meaning set forth in each
Commitment Transfer Supplement.
"Transferred Assets" shall have the meaning set forth in the definition
of Permitted Receivables Financing.
"Utilization" means, for any Utilization Period, the percentage
obtained by dividing the Average Outstanding Loans by the average of the daily
Aggregate Commitments.
"Utilization Fees" has the meaning specified in Section 3.5(b).
"Utilization Period" means each calendar quarter, except that the
initial Utilization Period shall commence on the Closing Date and end on March
31, 2002, and the final Utilization Period shall end on the Termination Date.
"Utilized Commitment" means, for any day that the Utilization Fees are
required to be paid pursuant to Section 3.5(b), the amount equal to the
principal amount of Loans outstanding on such day.
"Voting Stock" means, with respect to any Person, Capital Stock issued
by such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.
19
1.2 Computation of Time Periods.
All time references in this Credit Agreement and the other Credit
Documents shall be to Charlotte, North Carolina time unless otherwise indicated.
For purposes of computation of periods of time hereunder, the word "from" means
"from and including" and the words "to" and "until" each mean "to but
excluding."
1.3 Accounting Terms.
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis. All calculations made for the purposes of determining compliance with
this Credit Agreement (including, without limitation, calculation of the
financial covenants set forth in Section 6.7) shall (except as otherwise
expressly provided herein) be made by application of GAAP applied on a basis
consistent with the most recent annual or quarterly financial statements
delivered pursuant to Section 6.1 hereof (or, prior to the delivery of the first
financial statements pursuant to Section 6.1 hereof, consistent with the annual
audited financial statements referenced in Section 5.1(a)(i) hereof); provided,
however, if (a) the Borrower shall object to determining such compliance on such
basis at the time of delivery of such financial statements due to any change in
GAAP or the rules promulgated with respect thereto or (b) the Administrative
Agent or the Required Lenders shall so object in writing within 30 days after
delivery of such financial statements, then such calculations shall be made on a
basis consistent with the most recent financial statements delivered by the
Borrower to the Lenders as to which no such objection shall have been made.
SECTION 2
CREDIT FACILITY
2.1 Revolving Loans.
(a) Commitment. During the Commitment Period, subject to the terms and
conditions hereof, each Lender severally agrees to make revolving credit loans
in Dollars (the "Revolving Loans") to the Borrower from time to time in the
amount of such Lender's Commitment Percentage of such Revolving Loans for the
purposes hereinafter set forth; provided that (i) with regard to the Lenders
collectively, the aggregate principal amount of Loans outstanding at any time
shall not exceed the Aggregate Revolving Committed Amount, and (ii) with regard
to each Lender individually, the aggregate principal amount of such Lender's
Commitment Percentage of Revolving Loans outstanding at any time shall not
exceed such Lender's Revolving Committed Amount. Revolving Loans may consist of
Alternate Base Rate Loans or LIBOR Rate Loans, or a combination thereof, as the
Borrower may request, and may be repaid and reborrowed in accordance with the
provisions hereof.
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(b) Revolving Loan Borrowings.
(i) Notice of Borrowing. The Borrower shall request a
Revolving Loan borrowing by written notice (or telephone notice
promptly confirmed in writing) to the Administrative Agent not later
than 11:00 A.M. on the day of the requested borrowing, which shall be a
Business Day, in the case of Alternate Base Rate Loans, and on the
third Business Day prior to the date of the requested borrowing in the
case of LIBOR Rate Loans. Each such request for borrowing shall be
irrevocable and shall specify (A) that a Revolving Loan is requested,
(B) the date of the requested borrowing (which shall be a Business
Day), (C) the aggregate principal amount to be borrowed, and (D)
whether the borrowing shall be comprised of Alternate Base Rate Loans,
LIBOR Rate Loans or a combination thereof, and if LIBOR Rate Loans are
requested, the Interest Period(s) therefor. If the Borrower shall fail
to specify in any such Notice of Borrowing (I) an applicable Interest
Period in the case of a LIBOR Rate Loan, then such notice shall be
deemed to be a request for an Interest Period of one month, or (II) the
type of Revolving Loan requested, then such notice shall be deemed to
be a request for a Alternate Base Rate Loan hereunder. The
Administrative Agent shall give notice to each Lender promptly upon
receipt of each Notice of Borrowing pursuant to this Section 2.1(b)(i),
the contents thereof and each such Lender's share of any borrowing to
be made pursuant thereto.
(ii) Minimum Amounts. Each Revolving Loan shall be in a
minimum aggregate principal amount of (A) in the case of LIBOR Rate
Loans, $5,000,000 and integral multiples of $1,000,000 in excess
thereof (or the remaining amount of the Revolving Committed Amount, if
less) or (B) in the case of Alternate Base Rate Loans, $1,000,000 and
integral multiples of $1,000,000 in excess thereof (or the remaining
amount of the Revolving Committed Amount, if less).
(iii) Advances. Each Lender will make its Commitment
Percentage of each Revolving Loan borrowing available to the
Administrative Agent for the account of the Borrower at the office of
the Administrative Agent specified in Section 10.2, or at such office
as the Administrative Agent may designate in writing, by 1:00 p.m. on
the date specified in the applicable Notice of Borrowing in Dollars and
in funds immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrower by the
Administrative Agent by crediting the account designated by the
Borrower with the aggregate of the amounts made available to the
Administrative Agent by the Lenders and in like funds as received by
the Administrative Agent.
(c) Repayment. The principal amount of all Loans shall be due and
payable in full on the Termination Date.
(d) Interest. Subject to the provisions of Section 3.1:
(i) Alternate Base Rate Loans. During such periods as
Revolving Loans shall be comprised in whole or in part of Alternate
Base Rate Loans, such Alternate Base Rate
21
Loans shall bear interest at a per annum rate equal to the Alternate
Base Rate plus the Applicable Percentage;
(ii) LIBOR Rate Loans. During such periods as Revolving Loans
shall be comprised in whole or in part of LIBOR Rate Loans, such LIBOR
Rate Loans shall bear interest at a per annum rate equal to the LIBOR
Rate plus the Applicable Percentage.
Interest on Revolving Loans shall be payable in arrears on each applicable
Interest Payment Date (or at such other times as may be specified herein).
(e) Revolving Notes. The Revolving Loans shall be evidenced by a duly
executed Revolving Note in favor of each Lender in the form of Schedule 2.1(e)
attached hereto.
(f) Maximum Number of LIBOR Rate Loans. The Borrower will be limited to
a maximum number of eight (8) LIBOR Rate Loans outstanding at any time. For
purposes hereof, LIBOR Rate Loans with separate or different Interest Periods
will be considered as separate LIBOR Rate Loans even if their Interest Periods
expire on the same date.
(g) Extension of Termination Date. The Borrower may, within 90 days,
but not less than 60 days, prior to the then applicable Termination Date, by
notice to the Administrative Agent and the Lenders, make written request of the
Lenders to extend the then applicable Termination Date for an additional period
of 364 days (the "Extension Request"). Each Lender shall make a determination
not later than 30 days following receipt of the Extension Request (the date that
is 30 days following the date the Extension Request is received shall be the
"Extension Consent Date") as to whether or not it will agree to extend the
Termination Date as requested (such approval of an extension shall be an
"Extension Consent"); provided, however, that failure by any Lender to make a
timely response to the Borrower's request for extension of the Termination Date
shall be deemed to constitute a refusal by such Lender to extend the Termination
Date.
(h) Lender Not Consenting. If by any Extension Consent Date the
Borrower and the Administrative Agent have not received an Extension Consent
from any Lender, the Termination Date, as it relates to such Lender, shall not
be extended, the Commitment of such Lender shall terminate on the Termination
Date applicable to it and any Loans made by such Lender, all accrued and unpaid
interest thereon and all other amounts due under this Credit Agreement to such
Lender shall be due and payable on the Termination Date applicable to it. Upon
the termination of the Commitment of any such Lender, unless this Credit
Agreement is amended as provided in Sections 2.1(j) or 2.1(k), the Aggregate
Revolving Committed Amount shall be reduced by the amount of such terminated
Commitment, and the Commitment Percentage of each other Lender shall be adjusted
to that percentage obtained by dividing the Commitment of such Lender by the
Aggregate Revolving Committed Amount after giving effect to such reduction.
(i) Other Lenders. No refusal by any one Lender to consent to any
extension of the Termination Date shall affect the extension of the Termination
Date as it may relate to the Commitment and Loans of any Lender which consents
to such extension as provided in
22
Section 2.1(g), and one or more Lenders may consent to the extension of the
Termination Date as it relates to them notwithstanding any refusal by any other
Lenders so to consent; provided that even as to the consenting Lenders the
Termination Date will be extended only upon consent to such an extension by
Lenders holding more than 51% of the Aggregate Revolving Committed Amount.
(j) Increase in Commitment of Other Lender or Lenders. If any Lender
does not deliver an Extension Consent as provided in Section 2.1(g), the
Borrower may offer each Lender which has delivered an Extension Consent as
provided in Section 2.1(g) a reasonable opportunity to increase its Commitment
by an amount equal to its pro-rata share (based on its Commitment before such
increase) of the Commitment of the Lender which does not deliver an Extension
Consent as provided in Section 2.1(g). After giving such Lenders such an
opportunity, the Borrower may, with the approval of the Administrative Agent,
amend this Credit Agreement to increase the Commitment of any other Lender or
Lenders with the consent of such Lender or Lenders provided that such increase
does not increase the Aggregate Revolving Committed Amount to an amount greater
than the Aggregate Revolving Committed Amount in effect immediately before such
expiration or termination.
(k) Additional Lender or Lenders. If any Lender does not deliver an
Extension Consent as provided in Section 2.1(g), upon the expiration of the
Commitment of such Lender, the Borrower may, with the approval of the
Administrative Agent, amend this Credit Agreement as provided in Section 10.6 to
add one or more other Lenders as parties, with such Commitment or Commitments as
may be agreed to by the Administrative Agent and such other Lender or Lenders,
provided that such additions do not increase the Aggregate Revolving Committed
Amount to an amount greater than the Aggregate Revolving Committed Amount in
effect immediately before such expiration or termination.
(l) Notice. The Administrative Agent shall promptly provide each of the
Lenders with a copy of any amendment made pursuant to Section 2.1(j) or Section
2.1(k).
SECTION 3
OTHER PROVISIONS RELATING TO CREDIT FACILITIES
3.1 Default Rate.
Upon the occurrence, and during the continuance, of an Event of
Default, the principal of and, to the extent permitted by law, interest on the
Loans and any other amounts owing hereunder or under the other Credit Documents
shall bear interest, payable on demand, at a per annum rate 2% greater than the
interest rate which would otherwise be applicable (or if no rate is applicable,
whether in respect of interest, fees or other amounts, then 2% greater than the
Alternate Base Rate plus the Applicable Percentage).
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3.2 Extension and Conversion.
The Borrower shall have the option, on any Business Day, to extend
existing Loans into a subsequent permissible Interest Period or to convert Loans
into Loans of another interest rate type; provided, however, that (i) except as
expressly provided otherwise in this Credit Agreement, LIBOR Rate Loans may be
converted into Alternate Base Rate Loans only on the last day of the Interest
Period applicable thereto, (ii) LIBOR Rate Loans may be extended, and Alternate
Base Rate Loans may be converted into LIBOR Rate Loans, only if the conditions
in Section 4.2 have been satisfied, (iii) Loans extended as, or converted into,
LIBOR Rate Loans shall be subject to the terms of the definition of "Interest
Period" set forth in Section 1.1 and shall be in such minimum amounts as
provided in Section 2.1(b)(ii), and (iv) any request for extension or conversion
of a LIBOR Rate Loan which shall fail to specify an Interest Period shall be
deemed to be a request for an Interest Period of one month. Each such extension
or conversion shall be effected by the Borrower by giving a Notice of
Extension/Conversion (or telephone notice promptly confirmed in writing) to the
Administrative Agent prior to 11:00 A.M. on the Business Day of, in the case of
the conversion of a LIBOR Rate Loan into a Alternate Base Rate Loan, and on the
third Business Day prior to, in the case of the extension of a LIBOR Rate Loan
as, or conversion of a Alternate Base Rate Loan into, a LIBOR Rate Loan, the
date of the proposed extension or conversion, specifying (A) the date of the
proposed extension or conversion, (B) the Loans to be so extended or converted,
(C) the types of Loans into which such Loans are to be converted and, if
appropriate, (D) the applicable Interest Periods with respect thereto. Each
request for extension or conversion shall be irrevocable and shall constitute a
representation and warranty by the Borrower of the matters specified in Section
4.2. In the event the Borrower fails to request extension or conversion of any
LIBOR Rate Loan in accordance with this Section, or any such conversion or
extension is not permitted or required by this Section, then such LIBOR Rate
Loan shall be continued as a LIBOR Rate Loan at the end of the Interest Period
applicable thereto for an Interest Period of one month. The Administrative Agent
shall give each Lender notice as promptly as practicable of any such proposed
extension or conversion affecting any Loan.
3.3 Prepayments.
(a) Voluntary Prepayments. Revolving Loans may be repaid in whole or in
part without premium or penalty; provided that (i) LIBOR Rate Loans may be
prepaid only upon three (3) Business Days' prior written notice to the
Administrative Agent, and Alternate Base Rate Loans may be prepaid only upon at
least one (1) Business Day's prior written notice to the Administrative Agent,
(ii) prepayments of LIBOR Rate Loans must be accompanied by payment of any
amounts owing under Section 3.12, and (iii) partial prepayments shall be in
minimum principal amount of $10,000,000, and in integral multiples of $1,000,000
in excess thereof.
(b) Mandatory Prepayments. If at any time, the aggregate principal
amount of Loans shall exceed the Aggregate Revolving Committed Amount, the
Borrower shall immediately make payment on the Loans in an amount sufficient to
eliminate the deficiency.
(c) Application. Unless otherwise specified by the Borrower,
prepayments made hereunder shall be applied first to Alternate Base Rate Loans
and then to LIBOR Rate Loans in
24
direct order of Interest Period maturities. Amounts prepaid hereunder may be
reborrowed in accordance with the provisions hereof.
3.4 Termination, Reduction and Increase of Commitments
(a) Voluntary Reductions. The Commitments may be terminated or
permanently reduced by the Borrower in whole or in part upon three (3) Business
Days' prior written notice to the Administrative Agent; provided that (i) after
giving effect to any voluntary reduction, the aggregate principal amount of
Loans shall not exceed the Aggregate Revolving Committed Amount, as reduced, and
(ii) partial reductions shall be in minimum principal amounts of $10,000,000,
and in integral multiples of $1,000,000 in excess thereof.
(b) Mandatory Reduction. The Commitments hereunder shall terminate on
the Termination Date.
(c) Increase in Commitments. The Borrower shall have the right upon at
least fifteen (15) Business Days' prior written notice to the Administrative
Agent to increase the Aggregate Revolving Committed Amount by up to $25,000,000,
in a single increase, at any time on or after the Closing Date, subject,
however, in any such case, to satisfaction of the following conditions
precedent:
(i) no Default or Event of Default shall have occurred and be
continuing on the date on which such Aggregate Revolving Committed
Amount increase is to become effective;
(ii) the representations and warranties set forth in Section 5
of this Credit Agreement shall be true and correct in all material
respects on and as of the date on which such Aggregate Revolving
Committed Amount increase is to become effective (except to the extent
they expressly relate to an earlier date);
(iii) on or before the date on which such Aggregate Revolving
Committed Amount increase is to become effective, the Administrative
Agent shall have received, for its own account, the mutually acceptable
fees and expenses required by separate agreement of the Borrower and
the Administrative Agent to be paid in connection with such increase;
(iv) such Aggregate Revolving Committed Amount increase shall
be an integral multiple of $5,000,000 and shall in no event be less
than $5,000,000; and
(v) such requested Aggregate Revolving Commitment increase
shall be effective on such date only to the extent that, on or before
such date, (A) the Administrative Agent shall have received and
accepted a corresponding amount of Additional Commitment(s) pursuant to
a commitment letter(s) acceptable to the Administrative Agent from one
or more Lenders acceptable to the Administrative Agent and, with
respect to any Lender that is not at such time a Lender hereunder, to
the Borrower and (B) each such Lender has executed an agreement in the
form of Schedule
25
3.4(c) hereto (each such agreement a "New Commitment Agreement"),
accepted in writing therein by the Administrative Agent and, with
respect to any Lender that is not at such time a Lender hereunder, by
the Borrower, with respect to the Additional Commitment of such Lender.
3.5 Fees.
(a) Facility Fee. In consideration of the Commitments hereunder, the
Borrower agrees to pay to the Administrative Agent for the ratable benefit of
the Lenders a facility fee (the "Facility Fee") equal to the Applicable
Percentage per annum, prior to the Termination Date, on the average daily
Aggregate Revolving Committed Amount in effect from time to time, and after the
Termination Date, on the average daily aggregate Revolving Loans outstanding.
The Facility Fee shall be payable quarterly in arrears on the 15th day following
the last day of each calendar quarter for the immediately preceding quarter (or
portion thereof) beginning with the first such date to occur after the Closing
Date and on the Termination Date.
(b) Utilization Fee. For each day that the principal amount of
outstanding Loans hereunder is equal to or shall exceed an amount equal to fifty
percent (50%) of the then Aggregate Revolving Committed Amount, the Borrower
shall pay to the Administrative Agent for the pro rata benefit of the Lenders, a
per annum fee equal to one-eighth of one percent (.125%) on the Utilized
Commitment for such day (the "Utilization Fees"). The Utilization Fees, if any,
shall be due and payable in arrears on the first Business Day after the end of
each fiscal quarter of the Borrower (as well as on the Termination Date and on
any date that the Commitment is reduced) for the immediately preceding fiscal
quarter (or portion thereof), beginning with the first of such dates to occur
after the Closing Date.
(c) Administrative Agent's Fees. The Borrower agrees to pay to the
Administrative Agent, for its own account, an annual administrative fee and such
other fees, if any, referred to in the Fee Letter (collectively, the
"Administrative Agent's Fees").
3.6 Computation of Interest and Fees.
(a) Interest payable hereunder with respect to Alternate Base
Rate Loans based on the Prime Rate shall be calculated on the basis of
a year of 365 days (or 366 days, as applicable) for the actual days
elapsed. All other fees, interest and all other amounts payable
hereunder shall be calculated on the basis of a 360 day year for the
actual days elapsed. The Administrative Agent shall as soon as
practicable notify the Borrower and the Lenders of each determination
of a LIBOR Rate on the Business Day of the determination thereof. Any
change in the interest rate on a Loan resulting from a change in the
Alternate Base Rate shall become effective as of the opening of
business on the day on which such change in the Alternate Base Rate
shall become effective. The Administrative Agent shall as soon as
practicable notify the Borrower and the Lenders of the effective date
and the amount of each such change.
(b) Each determination of an interest rate by the
Administrative Agent pursuant to any provision of this Credit Agreement
shall be conclusive and binding on the
26
Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrower, deliver to
the Borrower a statement showing the computations used by the
Administrative Agent in determining any interest rate.
3.7 Pro Rata Treatment and Payments.
(a) Each borrowing of Revolving Loans and any reduction of the
Commitments shall be made pro rata according to the respective
Commitment Percentages of the Lenders. Each payment under this Credit
Agreement or any Note shall be applied (i) first, to any Fees then due
and owing, (ii) second, to interest then due and owing in respect of
the Notes of the Borrower and (iii) third, to principal then due and
owing hereunder and under the Notes of the Borrower. Each payment on
account of any Fees pursuant to Sections 3.5(a) and (b) shall be made
pro rata in accordance with the respective amounts due and owing. Each
payment (other than prepayments) by the Borrower on account of
principal of and interest on the Revolving Loans shall be made pro rata
according to the respective amounts due and owing hereunder.
Prepayments made pursuant to Section 3.3 shall be applied in accordance
with such section. Each optional prepayment on account of principal of
the Loans shall be applied in accordance with Section 3.3 and each
mandatory prepayment on account of principal of the Loans shall be
applied in accordance with Section 3.3. All payments (including
prepayments) to be made by the Borrower on account of principal,
interest and fees shall be made without defense, set-off or
counterclaim (except as provided in Section 3.13(b)) and shall be made
to the Administrative Agent for the account of the Lenders at the
Administrative Agent's office specified in Section 10.2 in Dollars and
in immediately available funds not later than 1:00 P.M. on the date
when due. The Administrative Agent shall distribute such payments to
the Lenders entitled thereto promptly upon receipt in like funds as
received. If any payment hereunder (other than payments on the LIBOR
Rate Loans) becomes due and payable on a day other than a Business Day,
such payment shall be extended to the next succeeding Business Day,
and, with respect to payments of principal, interest thereon shall be
payable at the then applicable rate during such extension. If any
payment on a LIBOR Rate Loan becomes due and payable on a day other
than a Business Day, the maturity thereof shall be extended to the next
succeeding Business Day unless the result of such extension would be to
extend such payment into another calendar month, in which event such
payment shall be made on the immediately preceding Business Day.
(b) Allocation of Payments After Event of Default.
Notwithstanding any other provision of this Credit Agreement to the
contrary, after the occurrence and during the continuance of an Event
of Default, all amounts collected or received by the Administrative
Agent or any Lender on account of the Credit Party Obligations or any
other amounts outstanding under any of the Credit Documents shall be
paid over or delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket
costs and expenses (including without limitation reasonable
attorneys' fees) of the Administrative
27
Agent in connection with enforcing the rights of the Lenders
under the Credit Documents;
SECOND, to payment of any fees owed to the
Administrative Agent;
THIRD, to the payment of all reasonable out-of-pocket
costs and expenses (including without limitation, reasonable
attorneys' fees) of each of the Lenders in connection with
enforcing its rights under the Credit Documents or otherwise
with respect to the Credit Party Obligations owing to such
Lender;
FOURTH, to the payment of all of the Credit Party
Obligations consisting of accrued fees and interest
(including, without limitation, accrued fees and interest
arising under any Hedging Agreement between any Credit Party
and any Lender, or any Affiliate of a Lender);
FIFTH, to the payment of the outstanding principal
amount of the Credit Party Obligations (including, without
limitation, the outstanding principal amount arising under any
Hedging Agreement between any Credit Party and any Lender, or
any Affiliate of a Lender, to the extent such Hedging
Agreement is permitted by Section 7.1(e));
SIXTH, to all other Credit Party Obligations and
other obligations which shall have become due and payable
under the Credit Documents or otherwise and not repaid
pursuant to clauses "FIRST" through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to
whoever may be lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be
applied in the numerical order provided until exhausted prior
to application to the next succeeding category and (ii) each
of the Lenders shall receive an amount equal to its pro rata
share (based on the proportion that the then outstanding Loans
held by such Lender bears to the aggregate then outstanding
Loans) of amounts available to be applied pursuant to clauses
"THIRD", "FOURTH", "FIFTH" and "SIXTH" above.
3.8 Non-Receipt of Funds by the Administrative Agent.
(a) Unless the Administrative Agent shall have been notified
in writing by a Lender prior to the date a Loan is to be made by such
Lender (which notice shall be effective upon receipt) that such Lender
does not intend to make the proceeds of such Loan available to the
Administrative Agent, the Administrative Agent may assume that such
Lender has made such proceeds available to the Administrative Agent on
such date, and the Administrative Agent may in reliance upon such
assumption (but shall not be required to) make available to the
Borrower a corresponding amount. If such corresponding amount is not in
fact made available to the Administrative Agent, the
28
Administrative Agent shall be able to recover such corresponding amount
from such Lender. If such Lender does not pay such corresponding amount
forthwith upon the Administrative Agent's demand therefor, the
Administrative Agent will promptly notify the Borrower, and the
Borrower shall immediately pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also be entitled
to recover from the Lender or the Borrower, as the case may be,
interest on such corresponding amount in respect of each day from the
date such corresponding amount was made available by the Administrative
Agent to the Borrower to the date such corresponding amount is
recovered by the Administrative Agent at a per annum rate equal to (i)
from the Borrower at the applicable rate for the applicable borrowing
pursuant to the Notice of Borrowing and (ii) from a Lender at the
Federal Funds Rate.
(b) Unless the Administrative Agent shall have been notified
in writing by the Borrower, prior to the date on which any payment is
due from it hereunder (which notice shall be effective upon receipt)
that the Borrower does not intend to make such payment, the
Administrative Agent may assume that such Borrower has made such
payment when due, and the Administrative Agent may in reliance upon
such assumption (but shall not be required to) make available to each
Lender on such payment date an amount equal to the portion of such
assumed payment to which such Lender is entitled hereunder, and if the
Borrower has not in fact made such payment to the Administrative Agent,
such Lender shall, on demand, repay to the Administrative Agent the
amount made available to such Lender. If such amount is repaid to the
Administrative Agent on a date after the date such amount was made
available to such Lender, such Lender shall pay to the Administrative
Agent on demand interest on such amount in respect of each day from the
date such amount was made available by the Administrative Agent to such
Lender to the date such amount is recovered by the Administrative Agent
at a per annum rate equal to the Federal Funds Rate.
(c) A certificate of the Administrative Agent submitted to the
Borrower or any Lender with respect to any amount owing under this
Section 3.8 shall be conclusive in the absence of manifest error.
3.9 Inability to Determine Interest Rate.
Notwithstanding any other provision of this Credit Agreement, if (i)
the Administrative Agent shall reasonably determine (which determination shall
be conclusive and binding absent manifest error) that, by reason of
circumstances affecting the relevant market, reasonable and adequate means do
not exist for ascertaining LIBOR for such Interest Period, or (ii) the Required
Lenders shall reasonably determine (which determination shall be conclusive and
binding absent manifest error) that the LIBOR Rate does not adequately and
fairly reflect the cost to such Lenders of funding LIBOR Rate Loans that the
Borrower has requested be outstanding as a LIBOR tranche during such Interest
Period, the Administrative Agent shall forthwith give telephone notice of such
determination, confirmed in writing, to the Borrower, and the Lenders at least
two Business Days prior to the first day of such Interest Period. Unless the
Borrower shall have notified the Administrative Agent upon receipt of such
telephone notice that it wishes to rescind or modify its request regarding such
LIBOR Rate Loans, any Loans that were
29
requested to be made as LIBOR Rate Loans shall be made as Alternate Base Rate
Loans and any Loans that were requested to be converted into or continued as
LIBOR Rate Loans shall remain as or be converted into Alternate Base Rate Loans.
Until any such notice has been withdrawn by the Administrative Agent, no further
Loans shall be made as, continued as, or converted into, LIBOR Rate Loans for
the Interest Periods so affected.
3.10 Illegality.
Notwithstanding any other provision of this Credit Agreement, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof by the relevant Governmental Authority to any Lender shall
make it unlawful for such Lender or its LIBOR Lending Office to make or maintain
LIBOR Rate Loans as contemplated by this Credit Agreement or to obtain in the
interbank eurodollar market through its LIBOR Lending Office the funds with
which to make such Loans, (a) such Lender shall promptly notify the
Administrative Agent and the Borrower thereof, (b) the commitment of such Lender
hereunder to make LIBOR Rate Loans or continue LIBOR Rate Loans as such shall
forthwith be suspended until the Administrative Agent shall give notice that the
condition or situation which gave rise to the suspension shall no longer exist,
and (c) such Lender's Loans then outstanding as LIBOR Rate Loans, if any, shall
be converted on the last day of the Interest Period for such Loans or within
such earlier period as required by law to Alternate Base Rate Loans. The
Borrower hereby agrees promptly to pay any Lender, upon its demand, any
additional amounts necessary to compensate such Lender for actual and direct
costs (but not including anticipated profits) reasonably incurred by such Lender
including, but not limited to, any interest or fees payable by such Lender to
lenders of funds obtained by it in order to make or maintain its LIBOR Rate
Loans hereunder. A certificate as to any additional amounts payable pursuant to
this Section submitted by such Lender, through the Administrative Agent, to the
Borrower shall be conclusive in the absence of manifest error. Each Lender
agrees to use reasonable efforts (including reasonable efforts to change its
LIBOR Lending Office) to avoid or to minimize any amounts which may otherwise be
payable pursuant to this Section; provided, however, that such efforts shall not
cause the imposition on such Lender of any additional costs or legal or
regulatory burdens deemed by such Lender in its reasonable discretion to be
material.
3.11 Requirements of Law.
(a) If the adoption of or any change in any Requirement of Law
or in the interpretation or application thereof or compliance by any
Lender with any request or directive (whether or not having the force
of law) from any central bank or other Governmental Authority made
subsequent to the date hereof:
(i) shall subject such Lender to any tax of any kind
whatsoever with respect to any LIBOR Rate Loan made by it, or
change the basis of taxation of payments to such Lender in
respect thereof (except for changes in the rate of tax on the
overall net income of such Lender);
(ii) shall impose, modify or hold applicable any
reserve, special deposit, compulsory loan or similar
requirement against assets held by, deposits
30
or other liabilities in or for the account of, advances, loans
or other extensions of credit by, or any other acquisition of
funds by, any office of such Lender which is not otherwise
included in the determination of the LIBOR Rate hereunder; or
(iii) shall impose on such Lender any other
condition;
and the result of any of the foregoing is to increase the cost
to such Lender of making or maintaining LIBOR Rate Loans or to reduce
any amount receivable hereunder or under any Note, then, in any such
case, the Borrower shall promptly pay such Lender, upon its demand, any
additional amounts necessary to compensate such Lender for such
additional cost or reduced amount receivable which such Lender
reasonably deems to be material as determined by such Lender with
respect to its LIBOR Rate Loans. A certificate as to any additional
amounts payable pursuant to this Section submitted by such Lender,
through the Administrative Agent, to the Borrower shall be conclusive
in the absence of manifest error. Each Lender agrees to use reasonable
efforts (including reasonable efforts to change its LIBOR Lending
Office, as the case may be) to avoid or to minimize any amounts which
might otherwise be payable pursuant to this paragraph of this Section;
provided, however, that such efforts shall not cause the imposition on
such Lender of any additional costs or legal or regulatory burdens
deemed by such Lender in its reasonable discretion to be material.
(b) If (i) any Lender shall have reasonably determined that
the adoption of or any change in any Requirement of Law regarding
capital adequacy or in the interpretation or application thereof or
compliance by such Lender or any corporation controlling such Lender
with any request or directive regarding capital adequacy (whether or
not having the force of law) from any central bank or Governmental
Authority made subsequent to the date hereof does or shall have the
effect of reducing the rate of return on such Lender's or such
corporation's capital as a consequence of its obligations hereunder to
a level below that which such Lender or such corporation could have
achieved but for such adoption, change or compliance (taking into
consideration such Lender's or such corporation's policies with respect
to capital adequacy) by an amount reasonably deemed by such Lender in
its sole discretion to be material and (ii) such Lender shall provide
the Borrower, within thirty (30) days following its determination that
such a reduction in its rate of return has occurred, with a certificate
demanding such additional amount (the "Shortfall Amount") as shall be
certified by such Lender as being required to compensate it for such
reduction, within fifteen (15) days after demand by such Lender, the
Borrower shall pay to such Lender the Shortfall Amount. Such a
certificate as to any additional amounts payable under this Section
submitted by a Lender (which certificate shall include a description of
the basis for the computation), through the Administrative Agent, to
the Borrower shall be conclusive absent manifest error.
(c) The agreements in this Section 3.11 shall survive the
termination of this Credit Agreement and payment of the Notes and all
other amounts payable hereunder.
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3.12 Indemnity.
The Borrower hereby agrees to indemnify each Lender and to hold such
Lender harmless from any funding loss or expense which such Lender may sustain
or incur as a consequence of (a) default by the Borrower in payment of the
principal amount of or interest on any Loan by such Lender in accordance with
the terms hereof, (b) default by the Borrower in accepting a borrowing after the
Borrower has given a notice in accordance with the terms hereof, (c) default by
the Borrower in making any prepayment after the Borrower has given a notice in
accordance with the terms hereof, and/or (d) the making by the Borrower of a
prepayment of a Loan, or the conversion thereof, on a day which is not the last
day of the Interest Period with respect thereto, in each case including, but not
limited to, any such loss or expense arising from interest or fees payable by
such Lender to lenders of funds obtained by it in order to maintain its Loans
hereunder. A certificate as to any additional amounts payable pursuant to this
Section submitted by any Lender, through the Administrative Agent, to the
Borrower (which certificate must be delivered to the Administrative Agent within
thirty days following such default, prepayment or conversion) shall be
conclusive in the absence of manifest error. The agreements in this Section
shall survive termination of this Credit Agreement and payment of the Notes and
all other amounts payable hereunder.
3.13 Taxes.
(a) All payments made by the Borrower hereunder or under any
Note will be, except as provided in Section 3.13(b), made free and
clear of, and without deduction or withholding for, any present or
future taxes, levies, imposts, duties, fees, assessments or other
charges of whatever nature now or hereafter imposed by any Governmental
Authority or by any political subdivision or taxing authority thereof
or therein with respect to such payments (but excluding any tax imposed
on or measured by the net income or profits of a Lender pursuant to the
laws of the jurisdiction in which it is organized or the jurisdiction
in which the principal office or applicable lending office of such
Lender is located or any subdivision thereof or therein) and all
interest, penalties or similar liabilities with respect thereto (all
such non-excluded taxes, levies, imposts, duties, fees, assessments or
other charges being referred to collectively as "Taxes"). If any Taxes
are so levied or imposed, the Borrower agrees to pay the full amount of
such Taxes, and such additional amounts as may be necessary so that
every payment of all amounts due under this Credit Agreement or under
any Note, after withholding or deduction for or on account of any
Taxes, will not be less than the amount provided for herein or in such
Note. The Borrower will furnish to the Administrative Agent as soon as
practicable after the date the payment of any Taxes is due pursuant to
applicable law certified copies (to the extent reasonably available and
required by law) of tax receipts evidencing such payment by the
Borrower. The Borrower agrees to indemnify and hold harmless each
Lender, and reimburse such Lender upon its written request, for the
amount of any Taxes so levied or imposed and paid by such Lender.
(b) Each Lender that is not a United States person (as such
term is defined in Section 7701(a)(30) of the Code) agrees to deliver
to the Borrower and the Administrative Agent on or prior to the Closing
Date, or in the case of a Lender that is an
32
assignee or transferee of an interest under this Credit Agreement
pursuant to Section 10.6 (unless the respective Lender was already a
Lender hereunder immediately prior to such assignment or transfer), on
the date of such assignment or transfer to such Lender, (i) if the
Lender is a "bank" within the meaning of Section 881(c)(3)(A) of the
Code, two accurate and complete original signed copies of Internal
Revenue Service Form 4224 or 1001 (or successor forms) certifying such
Lender's entitlement to a complete exemption from United States
withholding tax with respect to payments to be made under this Credit
Agreement and under any Note, or (ii) if the Lender is not a "bank"
within the meaning of Section 881(c)(3)(A) of the Code, either Internal
Revenue Service Form 1001 or 4224 as set forth in clause (i) above, or
(x) a certificate substantially in the form of Schedule 3.13 (any such
certificate, a "3.13 Certificate") and (y) two accurate and complete
original signed copies of Internal Revenue Service Form W-8 (or
successor form) certifying such Lender's entitlement to an exemption
from United States withholding tax with respect to payments of interest
to be made under this Credit Agreement and under any Note. In addition,
each Lender agrees that it will deliver upon the Borrower's request
updated versions of the foregoing, as applicable, whenever the previous
certification has become obsolete or inaccurate in any material
respect, together with such other forms as may be required in order to
confirm or establish the entitlement of such Lender to a continued
exemption from or reduction in United States withholding tax with
respect to payments under this Credit Agreement and any Note.
Notwithstanding anything to the contrary contained in Section 3.13(a),
but subject to the immediately succeeding sentence, (x) the Borrower
shall be entitled, to the extent it is required to do so by law, to
deduct or withhold Taxes imposed by the United States (or any political
subdivision or taxing authority thereof or therein) from interest, fees
or other amounts payable hereunder for the account of any Lender which
is not a United States person (as such term is defined in Section
7701(a)(30) of the Code) for U.S. Federal income tax purposes to the
extent that such Lender has not provided to the Borrower U.S. Internal
Revenue Service Forms that establish a complete exemption from such
deduction or withholding and (y) the Borrower shall not be obligated
pursuant to Section 3.13(a) hereof to gross-up payments to be made to a
Lender in respect of Taxes imposed by the United States if (I) such
Lender has not provided to the Borrower the Internal Revenue Service
Forms required to be provided to the Borrower pursuant to this Section
3.13(b) or (II) in the case of a payment, other than interest, to a
Lender described in clause (ii) above, to the extent that such Forms do
not establish a complete exemption from withholding of such Taxes.
Notwithstanding anything to the contrary contained in the preceding
sentence or elsewhere in this Section 3.13, the Borrower agrees to pay
additional amounts and to indemnify each Lender in the manner set forth
in Section 3.13(a) (without regard to the identity of the jurisdiction
requiring the deduction or withholding) in respect of any amounts
deducted or withheld by it as described in the immediately preceding
sentence as a result of any changes after the Closing Date in any
applicable law, treaty, governmental rule, regulation, guideline or
order, or in the interpretation thereof, relating to the deducting or
withholding of Taxes.
(c) Each Lender agrees to use reasonable efforts (including
reasonable efforts to change its LIBOR Lending Office, as the case may
be) to avoid or to minimize any amounts which might otherwise be
payable pursuant to this Section; provided, however,
33
that such efforts shall not cause the imposition on such Lender of any
additional costs or legal or regulatory burdens deemed by such Lender
in its reasonable discretion to be material.
(d) If the Borrower pays any additional amount pursuant to
this Section 3.13 with respect to a Lender, such Lender shall use
reasonable efforts to obtain a refund of tax or credit against its tax
liabilities on account of such payment; provided that such Lender shall
have no obligation to use such reasonable efforts if either (i) it is
in an excess foreign tax credit position or (ii) it believes in good
faith, in its sole discretion, that claiming a refund or credit would
cause adverse tax consequences to it. In the event that such Lender
receives such a refund or credit, such Lender shall pay to the Borrower
an amount that such Lender reasonably determines is equal to the net
tax benefit obtained by such Lender as a result of such payment by the
Borrower. In the event that no refund or credit is obtained with
respect to the Borrower's payments to such Lender pursuant to this
Section 3.13, then such Lender shall upon request provide a
certification that such Lender has not received a refund or credit for
such payments. Nothing contained in this Section 3.13 shall require a
Lender to disclose or detail the basis of its calculation of the amount
of any tax benefit or any other amount or the basis of its
determination referred to in the proviso to the first sentence of this
Section 3.13 to the Borrower or any other party.
(e) The agreements in this Section 3.13 shall survive the
termination of this Credit Agreement and the payment of the Notes and
all other amounts payable hereunder.
SECTION 4
CONDITIONS
4.1 Conditions to Closing.
This Credit Agreement shall become effective upon, and the obligation
of each Lender to make the initial Loans is subject to, the satisfaction of the
following conditions precedent:
(a) Execution of Credit Agreement and Credit Documents. Receipt of (i)
multiple counterparts of this Credit Agreement, (ii) a Revolving Note for each
Lender and (iii) an executed copy of the Three Year Credit Agreement, in each
case executed by a duly authorized officer of each party thereto and in each
case conforming to the requirements of this Credit Agreement.
(b) Legal Opinion. Receipt of a legal opinion of counsel to the Credit
Parties relating to this Credit Agreement and the other Credit Documents and the
transactions contemplated herein and therein, in form and substance reasonably
acceptable to the Administrative Agent, which opinion shall include, without
limitation, an opinion that the execution, delivery and performance of the
Credit Documents and the performance of the transactions contemplated thereby
will not conflict with, result in a breach of, require any consent or permit any
acceleration of (or require repayment of) any Indebtedness of the Credit Parties
or under any of the Credit Parties' corporate instruments and material
agreements.
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(c) Financial Information. Receipt by the Administrative Agent of the
financial information of the Borrower and its Subsidiaries referred to in
Section 5.1(a) and the three-year financial and operational projections for the
Borrower and its Subsidiaries referred to in Section 5.1(b), in form and
substance satisfactory to the Administrative Agent.
(d) Absence of Legal Proceedings. Except as set forth on Schedule 5.6,
the absence of any material pending or threatened action, suit, investigation,
proceeding, bankruptcy or insolvency, injunction, order or claim with respect to
the Borrower or any of its Subsidiaries.
(e) Corporate Documents. Receipt of the following (or their equivalent)
for each Credit Party, each (other than with respect to clause (iv)) certified
by the secretary or assistant secretary of such Credit Party as of the Closing
Date to be true and correct and in force and effect pursuant to a certificate
substantially in the form attached hereto as Schedule 4.1(e):
(i) Articles of Incorporation. Copies of the articles of
incorporation or charter documents certified to be true and complete as
of a recent date by the appropriate Governmental Authority of the state
of its organization.
(ii) Resolutions. Copies of resolutions of the Board of
Directors or comparable managing body approving and adopting the
respective Credit Documents, the transactions contemplated therein and
authorizing execution and delivery thereof.
(iii) Bylaws. Copies of the bylaws, operating agreement or
partnership agreement certified by a secretary or assistant secretary
as of the Closing Date to be true and correct and in force and effect
as of such date.
(iv) Good Standing. Copies, where applicable, of certificates
of good standing, existence or its equivalent certified as of a recent
date by the appropriate Governmental Authorities of the State of
organization and each other State in which the failure to so qualify
and be in good standing would be reasonably likely to have a Material
Adverse Effect.
(f) Fees. Receipt by the Administrative Agent and the Lenders of all
fees, if any, then owing pursuant to the Fee Letter, Section 3.5 or pursuant to
any Credit Document.
(g) Account Designation Letter. Receipt by the Administrative Agent of
an executed counterpart of the Account Designation Letter.
(h) Officer's Certificate. Receipt by the Administrative Agent of a
certificate of a Responsible Officer certifying that (i) each of the Borrower
and the Guarantors is solvent as of the Closing Date and (ii) the Borrower is in
pro forma compliance with all of the covenants in Section 6.7 both before and
after giving effect to any Loans to be made on the Closing Date.
(i) Payment Instructions. Receipt by the Administrative Agent of
payment instructions with respect to each wire transfer to be made by the
Administrative Agent on behalf
35
of the Lenders or the Borrower on the Closing Date setting forth the amount of
such transfer, the purpose of such transfer, the name and number of the account
to which such transfer is to be made, the name and ABA number of the bank or
other financial institution where such account is located and the name and
telephone number of an individual that can be contacted to confirm receipt of
such transfer.
(j) No Material Adverse Effect. Except as set forth on Schedule 4.1(j),
no Material Adverse Effect shall have occurred since December 31, 2000 (other
than as has been publicly disclosed from December 31, 2000 to January 24, 2002
in filings with the Securities and Exchange Commission or in press releases that
have been widely distributed (e.g. PR Newswire or Dow Xxxxx Newswire)).
(k) Consolidated EBITDA. Receipt by the Administrative Agent of
evidence satisfactory to the Administrative Agent that Consolidated EBITDA for
the twelve-month period ending on the last day of the last complete calendar
quarter immediately preceding the Closing Date was not less than $200,000,000.
(l) Evidence of Insurance. The Administrative Agent shall be satisfied
that the Borrower has in effect insurance policies for liability, casualty and
business interruption on terms and in coverage amounts comparable to the
industry standard applicable to the Borrower's assets and operations.
(m) Existing Indebtedness. All of the existing Indebtedness for
borrowed money of the Borrower and its Subsidiaries (other than Indebtedness
permitted to exist pursuant to Section 7.1) shall be repaid in full and
terminated and all security interests and Liens related thereto (if any) shall
be terminated and released on the Closing Date.
(n) Consents. The Administrative Agent shall have received evidence
that all necessary governmental, corporate, shareholder and third party consents
and approvals, if any, in connection with the financings and other transactions
contemplated hereby have been received and no condition exists which would
reasonably be likely to restrain, prevent or impose any material adverse
conditions on the transactions contemplated hereby.
(o) Additional Matters. All other documents and legal matters in
connection with the transactions contemplated by this Credit Agreement shall be
reasonably satisfactory in form and substance to the Administrative Agents and
the Required Lenders.
4.2 Conditions to All Loans.
The obligation of each Lender to make any Loan hereunder (including the
initial Loans to be made hereunder) is subject to the satisfaction of the
following conditions precedent on the date of making such Loan:
(a) Representations and Warranties. The representations and warranties
made by any Credit Party herein or in any other Credit Document or which are
contained in any certificate furnished at any time under or in connection
herewith or therewith shall be true and correct in all
36
material respects on and as of the date of such Loan as if made on and as of
such date (except for those which expressly relate to an earlier date).
(b) No Default or Event of Default. No Default or Event of Default
shall have occurred and be continuing on such date or after giving effect to the
Loan to be made on such date unless such Default or Event of Default shall have
been waived in accordance with this Credit Agreement.
Each request for a Loan (including extensions and conversions) and each
acceptance by the Borrower of a Loan (including extensions and conversions)
shall be deemed to constitute a representation and warranty by each of the
Credit Parties as of the date of such Loan that the conditions in subsections
(a) and (b) of this Section have been satisfied.
SECTION 5
REPRESENTATIONS AND WARRANTIES
To induce the Lenders to enter into this Credit Agreement and to make
Loans herein provided for, each of the Credit Parties hereby represents and
warrants to the Administrative Agent and to each Lender that:
5.1 Financial Condition.
(a) Each of the financial statements described below (copies of which
have heretofore been provided to the Administrative Agent for distribution to
the Lenders), have been prepared in accordance with GAAP consistently applied
throughout the periods covered thereby, and present fairly in all material
respects the financial condition and results from operations of the entities and
for the periods specified, subject in the case of interim company-prepared
statements to normal year-end adjustments:
(i) audited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries dated as of December 31, 2000, together with
related statements of income and cash flows certified by Deloitte &
Touche LLP, certified public accountants; and
(ii) a company-prepared consolidated condensed balance sheet
of the Borrower and its consolidated Subsidiaries dated as of December
31, 2001, together with related consolidated condensed statements of
income and cash flows for the period from January 1, 2001 through
December 31, 2001.
(b) The three-year financial and operations projections of the Borrower
and its Subsidiaries have been prepared in good faith based upon assumptions
believed by the Borrower to be reasonable at the time made.
37
5.2 No Material Adverse Change.
Except as set forth on Schedule 4.1(j), since December 31, 2000, there
has not occurred a change in the business, assets, liabilities (financial or
otherwise) of the Borrower and its Subsidiaries taken as a whole which is
reasonably likely to have a Material Adverse Effect (other than as has been
publicly disclosed from December 31, 2000 to January 24, 2002 in filings with
the Securities and Exchange Commission or in press releases made by the Borrower
in financial publications that have been widely distributed (e.g. PR Newswire or
Dow Xxxxx Newswire) or through publication on the Borrower's website).
5.3 Organization; Existence.
Each Credit Party (a) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, (b) has the
corporate or other necessary power and authority, and the legal right to own and
operate its property, to lease the property it operates as lessee and to conduct
the business in which it is currently engaged and (c) is duly qualified as a
foreign entity and in good standing under the laws of each jurisdiction where
its ownership, lease or operation of property or the conduct of its business
requires such qualification, other than in such jurisdictions where the failure
to be so qualified and in good standing would not, in the aggregate, have a
Material Adverse Effect.
5.4 Power; Authorization; Enforceable Obligations.
Each Credit Party has the corporate or other necessary power and
authority, and the legal right, to make, deliver and perform the Credit
Documents to which it is a party and has taken all necessary corporate or other
action to authorize the execution, delivery and performance by it of the Credit
Documents to which it is a party. No consent or authorization of, filing with,
notice to or other act by or in respect of, any Governmental Authority or any
other Person is required in connection with acceptance of extensions of credit
by the Borrower or the making of the guaranties hereunder or with the execution,
delivery or performance of any Credit Documents by the Credit Parties (other
than those which have been obtained) or with the validity or enforceability of
any Credit Document against the Credit Parties. Each Credit Document to which it
is a party constitutes a valid and legally binding obligation of each Credit
Party enforceable in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to general
equity principles.
5.5 Conflict.
The execution, delivery and performance of the Credit Documents, the
borrowings hereunder and the use of the proceeds of the Loans will not (a)
violate any Requirement of Law applicable to the Borrower or any of its
Subsidiaries (except those as to which waivers or consents have been obtained),
(b) conflict with, result in a breach of or constitute a default under (i) the
articles of incorporation, bylaws or other organizational documents of such
Person, (ii) any material indenture, agreement or other instrument to which such
Person is a party or by which any of its properties may be bound or (iii) any
approval of any Governmental Authority
38
relating to such Person, or (c) result in, or require, the creation or
imposition of any Lien on any of their respective properties or revenues
pursuant to any Requirement of Law or any Material Contract.
5.6 No Material Litigation.
No claim, litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the best knowledge of the
Credit Parties, threatened by or against any Credit Party or any of its
Subsidiaries or against any of their respective properties which (a) relates to
the Credit Documents or any of the transactions contemplated hereby or thereby
or (b) is reasonably likely to have a Material Adverse Effect. Set forth on
Schedule 5.6 is a summary of material litigation matters pending as of the
Closing Date.
5.7 No Default.
No Default or Event of Default has occurred and is continuing.
5.8 Taxes.
Each of the Credit Parties and its Subsidiaries has filed, or caused to
be filed, all tax returns (federal, state, local and foreign) required to be
filed and paid (a) all amounts of taxes shown thereon to be due (including
interest and penalties) and (b) all other taxes, fees, assessments and other
governmental charges (including mortgage recording taxes, documentary stamp
taxes and intangibles taxes) owing by it, except for such taxes (i) which are
not yet delinquent or (ii) that are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with GAAP. Neither any of the Credit Parties nor any of its
Subsidiaries are aware as of the Closing Date of any proposed tax assessments
against it or any of its Subsidiaries which could reasonably be expected to have
a Material Adverse Effect.
5.9 ERISA
Neither a Reportable Event nor an "accumulated funding deficiency"
(within the meaning of Section 412 of the Code or Section 302 of ERISA) has
occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan, and each Plan
has complied in all material respects with the applicable provisions of ERISA
and the Code, except to the extent that any such occurrence or failure to comply
would not reasonably be expected to have a Material Adverse Effect. No
termination of a Single Employer Plan has occurred resulting in any liability
that has remained underfunded, and no Lien in favor of the PBGC or a Plan has
arisen, during such five-year period which could reasonably be expected to have
a Material Adverse Effect. The present value of all accrued benefits under each
Single Employer Plan (based on those assumptions used to fund such Plans) did
not, as of the last annual valuation date prior to the date on which this
representation is made or deemed made, exceed the value of the assets of such
Plan allocable to such accrued benefits by an amount which, as determined in
accordance with GAAP, could reasonably be expected to have a Material Adverse
Effect. Neither the Borrower nor any Commonly Controlled Entity is currently
39
subject to any liability for a complete or partial withdrawal from a
Multiemployer Plan which could reasonably be expected to have a Material Adverse
Effect.
5.10 Governmental Regulations, Etc.
(a) No part of the proceeds of the Loans hereunder will be used,
directly or indirectly, for the purpose of purchasing or carrying any "margin
stock" within the meaning of Regulation U, or for the purpose of purchasing or
carrying or trading in any securities. If requested by any Lender or the
Administrative Agent, the Borrower will furnish to the Administrative Agent and
each Lender a statement to the foregoing effect in conformity with the
requirements of FR Form U-1 referred to in said Regulation U. No Indebtedness
being reduced or retired out of the proceeds of the Loans hereunder was or will
be incurred for the purpose of purchasing or carrying any margin stock within
the meaning of Regulation U or any "margin security" within the meaning of
Regulation T. "Margin stock" within the meaning of Regulation U does not
constitute more than 25% of the value of the consolidated assets of the Borrower
and its Subsidiaries. Neither the execution and delivery hereof by the Borrower,
nor the performance by it of any of the transactions contemplated by this Credit
Agreement (including, without limitation, the direct or indirect use of the
proceeds of the Loans) will violate or result in a violation of the Securities
Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, or
regulations issued pursuant thereto, or Regulation T, U or X.
(b) None of the Credit Parties is (i) an "investment company"
registered or required to be registered under the Investment Company Act of
1940, as amended, and is not controlled by such a company, or (ii) a "holding
company", or a "subsidiary company" of a "holding company", or an "affiliate" of
a "holding company" or of a "subsidiary" of a "holding company", within the
meaning of the Public Utility Holding Company Act of 1935, as amended.
5.11 Subsidiaries.
Set forth on Schedule 5.11 is a list of all the Subsidiaries of the
Credit Parties as of the Closing Date, including a list of the Material Domestic
Subsidiaries of the Borrower, the jurisdiction of their incorporation and the
direct or indirect ownership interest of the Borrower therein.
5.12 Use of Proceeds.
The Loans will be used solely (a) to refinance certain existing
Indebtedness, (b) to provide general working capital and (c) for other general
corporate purposes.
5.13 Compliance with Laws; Contractual Obligations.
Each Credit Party and each Subsidiary is in compliance with all
Requirements of Law, except to the extent that the failure to comply therewith
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. None of the Credit Parties is in default under or with
respect to any of its contractual obligations in any respect which could
reasonably be expected to have a Material Adverse Effect.
40
5.14 Accuracy and Completeness of Information.
As of the Closing Date, to the best of the Borrower's knowledge, no
representation or warranty of the Borrower or any of its Subsidiaries contained
in this Credit Agreement or any other Credit Document or in any other document,
certificate or written statement furnished to the Lenders by or on behalf of the
Borrower or any of its Subsidiaries contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the statements
contained in such agreements, documents, certificates and statements not
misleading in light of the circumstances in which the same were made.
5.15 Environmental Matters.
(a) The Borrower and each of its Subsidiaries is in compliance in all
material respects with all Environmental Laws the non-compliance with which
could reasonably be expected to have a Material Adverse Effect.
(b) There has been no "release or threatened release of a hazardous
substance" (as defined by the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended, 42 U.S.C. Section 9601 et seq.) or any
other release, emission or discharge into the environment of any hazardous or
toxic substance, pollutant or other materials from the Borrower's or its
Subsidiaries' property other than as permitted under applicable Environmental
Law and other than those which would not have a Material Adverse Effect. Other
than disposals (i) for which the Borrower has been indemnified in full or (ii)
which would not have a Material Adverse Effect, all "hazardous waste" (as
defined by the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et
seq. (1976) and the regulations thereunder, 40 CFR Part 261 ("RCRA")) generated
at the Borrower's or any Subsidiaries' properties have in the past been and
shall continue to be disposed of at sites which maintain valid permits under
RCRA and any applicable state or local Environmental Law.
5.16 Solvency.
The fair saleable value of the Credit Parties' assets taken as a whole,
measured on a going concern basis, exceeds all probable liabilities, including
those to be incurred pursuant to this Credit Agreement. None of the Credit
Parties (a) has unreasonably small capital in relation to the business in which
it is or proposes to be engaged or (b) has incurred, or believes that it will
incur after giving effect to the transactions contemplated by this Credit
Agreement, debts beyond its ability to pay such debts as they become due.
5.17 No Burdensome Restrictions.
None of the Borrower or any of its Subsidiaries is a party to any
agreement or instrument or subject to any other obligation or any charter or
corporate restriction or any provision of any applicable law, rule or regulation
which, individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
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5.18 Material Contracts.
Schedule 5.18 sets forth a true and correct and complete list of all
Material Contracts currently in effect as of the Closing Date. All of the
Material Contracts are in full force and effect and no material defaults
currently exist thereunder.
5.19 Insurance.
The Borrower and its Subsidiaries maintain insurance policies for
liability, casualty and business interruption on terms and in coverage amounts
comparable to the industry standard applicable to the assets and operations of
the Borrower and its Subsidiaries.
SECTION 6
AFFIRMATIVE COVENANTS
The Credit Parties covenant and agree that on the Closing Date, and so
long as this Credit Agreement is in effect and until the Commitments have been
terminated, no Loans remain outstanding and all amounts owing hereunder or under
any other Credit Document or in connection herewith or therewith have been paid
in full, the Credit Parties shall, and shall cause each Subsidiary to:
6.1 Financial Statements.
Furnish, or cause to be furnished, to the Administrative Agent for
distribution to the Lenders:
(a) Audited Financial Statements. As soon as available, but in any
event within 90 days after the end of each fiscal year of the Borrower, an
audited consolidated and consolidating balance sheet of the Borrower and its
Subsidiaries as of the end of the fiscal year and the related consolidated and
consolidating statements of income, retained earnings, shareholders' equity and
cash flows for the year, audited by an independent certified public accounting
firm of nationally recognized standing, setting forth in each case in
comparative form the figures for the previous year, reported without a "going
concern" or like qualification or exception, or qualification indicating that
the scope of the audit was inadequate to permit such independent certified
public accountants to certify such financial statements without such
qualification.
(b) Company-Prepared Financial Statements. As soon as available, but in
any event within 45 days after the end of each fiscal quarters of the Borrower,
a company-prepared consolidated and consolidating balance sheet of the Borrower
and its Subsidiaries as of the end of the quarter and related company-prepared
consolidated and consolidating statements of income, retained earnings,
shareholders' equity and cash flows for such quarterly period and for the fiscal
year to date; in each case setting forth in comparative form the consolidated
figures for the corresponding period or periods of the preceding fiscal year or
the portion of the fiscal year ending with such period, as applicable, in each
case subject to normal recurring year-end audit adjustments.
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All such financial statements shall fairly present in all material respects the
financial condition of the Borrower (subject, in the case of interim statements,
to normal recurring year-end audit adjustments) and shall be prepared in
reasonable detail and in accordance with GAAP applied consistently throughout
the periods reflected therein and further accompanied by a description of, and
an estimation of the effect on the financial statements on account of, a change
in the application of accounting principles as provided in Section 1.3.
6.2 Certificates; Other Information.
Furnish, or cause to be furnished, to the Administrative Agent for
distribution to the Lenders:
(a) Officer's Certificate. Concurrently with the delivery of the
financial statements referred to in Sections 6.1(a) and 6.1(b) above, a
certificate of a Responsible Officer stating that, to the best of such
Responsible Officer's knowledge and belief, (i) the financial statements fairly
present in all material respects the financial condition of the parties covered
by such financial statements, (ii) during such period each Credit Party has
observed or performed its covenants and other agreements hereunder and under the
other Credit Documents, and satisfied the conditions contained in this Credit
Agreement to be observed, performed or satisfied by it (except to the extent
waived in accordance with the provisions hereof) and (iii) such Responsible
Officer has obtained no knowledge of any Default or Event of Default except as
specified in such certificate. Such certificate shall include the calculations
required to indicate compliance with Section 6.7 as of the last day of the
period covered by such financial statements. A form of Officer's Certificate is
attached as Schedule 6.2(a).
(b) Public Information. Promptly after the same are sent, copies of all
reports (other than those otherwise provided pursuant to Section 6.1) and other
financial information which any Credit Party sends to its public stockholders,
and promptly after the same are filed, copies of all financial statements and
non-confidential reports which any Credit Party may make to, or file with, the
Securities and Exchange Commission or any successor or analogous United States
Governmental Authority.
(c) Other Information. Promptly, such additional financial and other
information as the Administrative Agent, at the request of any Lender, may from
time to time reasonably request.
6.3 Notices.
Give notice to the Administrative Agent (which shall promptly transmit
such notice to each Lender) of:
(a) Defaults. Promptly (but in any event within two (2) Business Days),
after any Credit Party knows or has reason to know thereof, the occurrence of
any Default or Event of Default.
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(b) Legal Proceedings. Promptly, any litigation, or any investigation
or proceeding (including without limitation, any environmental proceeding) known
to a Credit Party and not set forth on Schedule 5.6, relating to a Credit Party
or any of its Subsidiaries which, if adversely determined, would reasonably be
expected to have a Material Adverse Effect.
(c) ERISA. Promptly, (i) the occurrence or expected occurrence of any
Reportable Event with respect to any Plan, a failure to make any required
contribution to a Plan, the creation of any Lien in favor of the PBGC (other
than a Permitted Lien) or a Plan or any withdrawal from, or the termination,
Reorganization or Insolvency of, any Multiemployer Plan or (ii) the institution
of proceedings or the taking of any other action by the PBGC or the Borrower or
any Commonly Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the terminating, Reorganization or Insolvency of, any Plan;
(d) Change in Debt Rating. Promptly, any change in the Borrower's Debt
Rating as provided by S&P or Xxxxx'x.
(e) Change in Fiscal Year. Promptly, any change in the fiscal year of
the Borrower or any of its Subsidiaries.
(f) Other. Promptly, any other development or event which a Responsible
Officer of the Borrower determines is reasonably likely to have a Material
Adverse Effect.
Each notice pursuant to this Section shall be accompanied by a statement of a
Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the Borrower proposes to take with
respect thereto.
6.4 Maintenance of Existence; Compliance with Laws; Contractual
Obligations.
(a) Preserve, renew and keep in full force and effect its corporate
existence and take all reasonable action to maintain all rights, privileges,
licenses and franchises necessary or desirable in the normal conduct of its
business.
(b) Comply with all Requirements of Law (including, without limitation,
all Environmental Laws and ERISA) applicable to it except to the extent that
failure to comply therewith would not, in the aggregate, have a Material Adverse
Effect.
(c) Fully perform and satisfy all of its obligations under all of its
contractual obligations except to the extent that failure to perform and satisfy
such obligations would not, in the aggregate, have a Material Adverse Effect.
6.5 Maintenance of Property; Insurance.
Keep all material property useful and necessary in its business in
reasonably good working order and condition (ordinary wear and tear excepted);
maintain with financially sound and reputable insurance companies casualty,
liability, business interruption and such other insurance (which may include
plans of self-insurance) with such coverage and deductibles, and
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in such amounts as may be consistent with prudent business practice and in any
event consistent with normal industry practice; and furnish to the
Administrative Agent, upon written request, full information as to the insurance
carried.
6.6 Inspection of Property; Books and Records; Discussions.
Keep proper books of records and account in which full, true and
correct entries in conformity with GAAP and all Requirements of Law shall be
made of all dealings and transactions in relation to its businesses and
activities; and permit, during regular business hours and upon reasonable notice
by the Administrative Agent, the Administrative Agent to visit and inspect any
of its properties and examine and make abstracts (including photocopies) from
any of its books and records at any reasonable time, and to discuss the
business, operations, properties and financial and other condition of the Credit
Parties and their Subsidiaries with officers and employees of the Credit Parties
and their Subsidiaries and with their independent certified public accountants.
The cost of the inspection referred to in the preceding sentence shall be for
the account of the Lenders unless an Event of Default has occurred and is
continuing, in which case the cost of such inspection shall be for the account
of the Borrower.
6.7 Financial Covenants.
(a) Consolidated Net Worth. Maintain Consolidated Net Worth at all
times (which shall be calculated as of the end of each fiscal quarter) of not
less than $100,000,000 plus 50% of Consolidated Net Income (if positive) from
the Closing Date to the date of computation.
(b) Leverage Ratio. Maintain a Leverage Ratio at all times (which shall
be calculated as of the end of each fiscal quarter) of not greater than 3.00 to
1.00.
6.8 Use of Proceeds.
Use the Loans solely for the purposes provided in Section 5.12.
6.9 Additional Guarantors.
Cause each of the Borrower's Material Domestic Subsidiaries which is
not a party to this Credit Agreement, whether newly formed, after acquired or
otherwise existing, to promptly become a "Guarantor" hereunder by way of
execution of a Joinder Agreement.
6.10 Payment of Obligations.
Pay, discharge or otherwise satisfy at or before maturity or before
they become delinquent, as the case may be, all its taxes (Federal, state, local
and any other taxes) and all its other obligations and liabilities of whatever
nature and any additional costs that are imposed as a result of any failure to
so pay, discharge or otherwise satisfy such obligations and liabilities, except
when the amount or validity of such obligations, liabilities and costs is
currently being contested in good faith by appropriate proceedings and reserves,
if applicable, in conformity with
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GAAP with respect thereto have been provided on the books of the Borrower or its
Subsidiaries, as the case may be.
6.11 Environmental Laws.
(a) Comply in all material respects with, and ensure compliance in all
material respects by all tenants and subtenants, if any, with, all applicable
Environmental Laws and obtain and comply in all material respects with and
maintain, and ensure that all tenants and subtenants obtain and comply in all
material respects with and maintain, any and all licenses, approvals,
notifications, registrations or permits required by applicable Environmental
Laws except to the extent that failure to do so could not reasonably be expected
to have a Material Adverse Effect;
(b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding Environmental
Laws except to the extent that the same are being contested in good faith by
appropriate proceedings and the pendency of such proceedings could not
reasonably be expected to have a Material Adverse Effect; and
(c) Defend, indemnify and hold harmless the Administrative Agent and
the Lenders, and their respective employees, agents, officers and directors and
affiliates, from and against any and all claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or nature
known or unknown, contingent or otherwise, arising out of, or in any way
relating to the violation of, noncompliance with or liability under, any
Environmental Law applicable to the operations of the Credit Parties or any of
their Subsidiaries or their Properties, or any orders, requirements or demands
of Governmental Authorities related thereto, including, without limitation,
reasonable attorney's and consultant's fees, investigation and laboratory fees,
response costs, court costs and litigation expenses, except to the extent that
any of the foregoing arise out of the gross negligence or willful misconduct of
the party seeking indemnification therefor. The agreements in this paragraph
shall survive repayment of the Notes and all other amounts payable hereunder.
SECTION 7
NEGATIVE COVENANTS
The Credit Parties covenant and agree that on the Closing Date, and so
long as this Credit Agreement is in effect and until the Commitments have been
terminated, no Loans remain outstanding and all amounts owing hereunder or under
any other Credit Document or in connection herewith or therewith have been paid
in full, the Credit Parties shall not and shall not permit any Subsidiary to:
7.1 Indebtedness.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to, contract, create, incur, assume or permit to exist any Indebtedness, except:
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(a) Indebtedness arising or existing under this Credit Agreement and
the other Credit Documents;
(b) Indebtedness of the Borrower and its Subsidiaries existing as of
the Closing Date as referenced in the financial statements referenced in Section
5.1 (and set out more specifically in Schedule 7.1(b)) hereto and renewals,
refinancings, extensions or replacements thereof in a principal amount not in
excess of that outstanding as of the Closing Date;
(c) Indebtedness of the Borrower and its Subsidiaries incurred after
the Closing Date consisting of Capital Leases or Indebtedness incurred to
provide all or a portion of the purchase price or cost of construction of an
asset provided that (i) such Indebtedness when incurred shall not exceed the
purchase price or cost of construction of such asset; (ii) no such Indebtedness
shall be refinanced for a principal amount in excess of the principal balance
outstanding thereon at the time of such refinancing; and (iii) the total amount
of all such Indebtedness shall not exceed $25,000,000 at any time outstanding;
(d) Unsecured intercompany Indebtedness among the Credit Parties,
provided that any such Indebtedness shall be fully subordinated to the Credit
Party Obligations hereunder on terms reasonably satisfactory to the --------
Administrative Agent;
(e) Indebtedness and obligations owing under Hedging Agreements entered
into in order to manage existing or anticipated interest rate, exchange rate or
commodity price risks and not for speculative purposes;
(f) Indebtedness and obligations of Credit Parties owing under
documentary letters of credit for the purchase of goods or other merchandise
generally;
(g) Guaranty Obligations in respect of Indebtedness of a Credit Party
to the extent such Indebtedness is permitted to exist or be incurred pursuant to
this Section 7.1;
(h) obligations in connection with any Permitted Receivables Financing,
to the extent such obligations constitute Indebtedness;
(i) unsecured Indebtedness of Foreign Subsidiaries to the extent that
any such Indebtedness is non-recourse to the Borrower or any Domestic
Subsidiary; and
(j) other unsecured Indebtedness of the Borrower which does not exceed
$200,000,000 in the aggregate at any time outstanding.
7.2 Liens.
Each of the Credit Parties will not, nor will it permit any Material
Domestic Subsidiary to, contract, create, incur, assume or permit to exist any
Lien with respect to any of its property or assets of any kind (whether real or
personal, tangible or intangible), whether now owned or hereafter acquired,
except for Permitted Liens.
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7.3 Nature of Business.
Each of the Credit Parties will not, nor will it permit any Material
Domestic Subsidiary to, alter the character of its business in any material
respect from that conducted as of the Closing Date (it being understood and
agreed that any consumer packaged goods line of business shall be deemed to be
within the character of the Credit Parties' businesses).
7.4 Consolidation, Merger, Sale or Purchase of Assets, etc.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to,
(a) dissolve, liquidate or wind up its affairs, sell, transfer, lease
or otherwise dispose of its property or assets or agree to do so at a future
time except the following, without duplication, shall be expressly permitted:
(i) the sale, transfer, lease or other disposition of
inventory (whether current, obsolete or excess) and materials in the
ordinary course of business;
(ii) the sale, transfer or other disposition of cash and Cash
Equivalents;
(iii) (A) the disposition of property or assets as a direct
result of a Recovery Event or (B) the sale, lease, transfer or other
disposition of machinery, parts and equipment no longer used or useful
in the conduct of the business of the Borrower or any of its
Subsidiaries, so long as the net proceeds therefrom are used to replace
such machinery, parts and equipment or to purchase or otherwise acquire
new assets or property within 180 days of receipt of the net proceeds;
(iv) the sale, lease or transfer of property or assets between
Credit Parties;
(v) any sale of Transferred Assets by such Person to a
Receivables Financier in connection with a Permitted Receivables
Financing;
(vi) the sale of assets attributable to the Borrower's (A)
Argentinean operations and (B) Armour food business; and
(vii) the sale, lease or transfer of property or assets not to
exceed $20,000,000 in the aggregate in any fiscal year;
provided, that, in the case of clauses (ii), (iii), (vi) and (vii)
above, at least 75% of the consideration received therefor by the Borrower or
any such Subsidiary is in the form of cash or Cash Equivalents; or
(b) (i) purchase, lease or otherwise acquire (in a single transaction
or a series of related transactions) the property or assets of any Person (other
than purchases or other acquisitions of inventory, materials, property and
equipment in the ordinary course of business,
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except as otherwise limited or prohibited herein) or (ii) enter into any
transaction of merger or consolidation, except for (A) investments or
acquisitions permitted pursuant to Section 7.5, and (B) the merger or
consolidation of a Credit Party with and into another Credit Party; provided
that if the Borrower is a party thereto, the Borrower will be the surviving
corporation.
7.5 Advances, Investments and Loans.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to, make any Investment except for Permitted Investments.
7.6 Transactions with Affiliates.
Except as permitted in subsection (iv) of the definition of Permitted
Investments, each of the Credit Parties will not, nor will it permit any
Subsidiary to, enter into any transaction or series of transactions, whether or
not in the ordinary course of business, with any officer, director, shareholder
or Affiliate other than on terms and conditions substantially as favorable as
would be obtainable in a comparable arm's-length transaction with a Person other
than an officer, director, shareholder or Affiliate.
7.7 Fiscal Year; Organizational Documents; Material Contracts.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to, amend, modify or change its articles of incorporation (or corporate charter
or other similar organizational document) or bylaws (or other similar document)
without the prior written consent of the Required Lenders. Each of the Credit
Parties will not, nor will it permit any Subsidiary to, without the prior
written consent of the Administrative Agent, amend, modify, cancel or terminate
or fail to renew or extend or permit the amendment, modification, cancellation
or termination of any of the Material Contracts, except in the event that such
amendments, modifications, cancellations or terminations could not reasonably be
expected to have a Material Adverse Effect.
7.8 Limitation on Restricted Actions.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to, directly or indirectly, create or otherwise cause or suffer to exist or
become effective any encumbrance or restriction on the ability of any such
Person to (a) pay dividends or make any other distributions to any Credit Party
on its Capital Stock or with respect to any other interest or participation in,
or measured by, its profits, (b) pay any Indebtedness or other obligation owed
to any Credit Party, (c) make loans or advances to any Credit Party, (d) sell,
lease or transfer any of its properties or assets to any Credit Party, or (e)
act as a Guarantor and pledge its assets pursuant to the Credit Documents or any
renewals, refinancings, exchanges, refundings or extension thereof, except (in
respect of any of the matters referred to in clauses (a)-(d) above) for such
encumbrances or restrictions existing under or by reason of (i) this Credit
Agreement and the other Credit Documents, (ii) applicable law, (iii) any
document or instrument governing Indebtedness incurred pursuant to Section
7.1(c); provided that any such restriction contained therein relates only to the
asset or assets constructed or acquired in connection therewith, or (iv) any
Permitted
49
Lien or any document or instrument governing any Permitted Lien; provided that
any such restriction contained therein relates only to the asset or assets
subject to such Permitted Lien.
7.9 Restricted Payments.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to, directly or indirectly, declare, order, make or set apart any sum for or pay
any Restricted Payment, except (a) to make dividends payable solely in the same
class of Capital Stock of such Person, (b) to make dividends or other
distributions payable to any Credit Party (directly or indirectly through
Subsidiaries) and (c) the Borrower may pay dividends so long as, after giving
effect thereto on a pro forma basis, no Default or Event of Default shall exist.
7.10 Sale Leasebacks.
The Credit Parties will not, directly or indirectly, become or remain
liable as lessee or as guarantor or other surety with respect to any lease,
whether an operating lease or a Capital Lease, of any property (whether real,
personal or mixed), whether now owned or hereafter acquired, in an aggregate
amount exceeding $40,000,000 at any time outstanding (a) which any Credit Party
has sold or transferred or is to sell or transfer to a Person which is not
another Credit Party or (b) which any Credit Party intends to use for
substantially the same purpose as any other property which has been sold or is
to be sold or transferred by such Credit Party to another Person which is not
another Credit Party in connection with such lease.
7.11 No Further Negative Pledges.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to, enter into, assume or become subject to any agreement prohibiting or
otherwise restricting the creation or assumption of any Lien upon its properties
or assets, whether now owned or hereafter acquired, or requiring the grant of
any security for such obligation if security is given for some other obligation,
except (a) pursuant to this Credit Agreement and the other Credit Documents, (b)
pursuant to any document or instrument governing Indebtedness incurred pursuant
to Section 7.1(c), provided that any such restriction contained therein relates
only to the asset or assets constructed or acquired in connection therewith and
(c) in connection with any Permitted Lien or any document or instrument
governing any Permitted Lien, provided that any such restriction contained
therein relates only to the asset or assets subject to such Permitted Lien.
SECTION 8
EVENTS OF DEFAULT
8.1 Events of Default.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
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(a) The Borrower shall fail to pay any principal on any Loan when due
in accordance with the terms hereof; or the Borrower shall fail to pay any
interest on any Loan or any Fee or other amount payable hereunder when due in
accordance with the terms hereof and such failure shall continue unremedied for
three (3) Business Days (or any Guarantor shall fail to pay on the Guaranty in
respect of any of the foregoing or in respect of any other Guaranty Obligations
thereunder within the aforesaid period of time); or
(b) Any representation or warranty made or deemed made herein or in any
of the other Credit Documents or which is contained in any certificate, document
or financial or other statement furnished at any time under or in connection
with this Credit Agreement shall prove to have been incorrect, false or
misleading in any material respect on or as of the date made or deemed made; or
(c) (i) Any Credit Party shall fail to perform, comply with or observe
any term, covenant or agreement applicable to it contained in Sections 6.3(a),
6.4(a) or 6.7 or in Section 7; or (ii) any Credit Party shall fail to comply
with any other covenant contained in this Credit Agreement or the other Credit
Documents or any other agreement, document or instrument among any Credit Party,
the Administrative Agent and the Lenders or executed by any Credit Party in
favor of the Administrative Agent or the Lenders (other than as described in
Sections 7.1(a), 7.1(b) or 7.1(c)(i) above), and in the event such breach or
failure to comply is capable of cure, is not cured within thirty (30) days after
the earlier to occur of (A) a Responsible Officer obtaining knowledge thereof or
(B) notice thereof received from the Administrative Agent of its occurrence; or
(d) Any Credit Party or any of its Subsidiaries shall (i) default in
any payment of principal of or interest on any Indebtedness (other than the
Notes) in a principal amount outstanding of at least $15,000,000 in the
aggregate for the Credit Parties and their Subsidiaries beyond the period of
grace, if any, provided in the instrument or agreement under which such
Indebtedness was created, (ii) default in the observance or performance of any
other agreement or condition relating to any Indebtedness in a principal amount
outstanding of at least $15,000,000 in the aggregate for the Credit Parties and
their Subsidiaries or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition exist,
the effect of which default or other event or condition is to cause, or to
permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Indebtedness (or a trustee or agent on behalf of such
holder or holders or beneficiary or beneficiaries) to cause, with the giving of
notice if required, such Indebtedness to become due prior to its stated maturity
or (iii) default in the due performance or observance of any term, covenant or
agreement under any Material Contract which results in liabilities or damages in
excess of $25,000,000 in the aggregate; or
(e) (i) Any Credit Party or any of its Subsidiaries shall commence any
case, proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B)
seeking appointment of a
51
receiver, trustee, custodian, conservator or other similar official for it or
for all or any substantial part of its assets, or any Credit Party or any of its
Subsidiaries shall make a general assignment for the benefit of its creditors;
or (ii) there shall be commenced against any Credit Party or any of its
Subsidiaries any case, proceeding or other action of a nature referred to in
clause (i) above which (A) results in the entry of an order for relief or any
such adjudication or appointment or (B) remains undismissed, undischarged or
unbonded for a period of 60 days; or (iii) there shall be commenced against any
Credit Party or any of its Subsidiaries any case, proceeding or other action
seeking issuance of a warrant of attachment, execution, distraint or similar
process against all or any substantial part of its assets which results in the
entry of an order for any such relief which shall not have been vacated,
discharged, or stayed or bonded pending appeal within 60 days from the entry
thereof; or (iv) any Credit Party or any of its Subsidiaries shall take any
action in furtherance of, or indicating its consent to, approval of, or
acquiescence in, any of the acts set forth in clauses (i), (ii), or (iii) above;
or (v) any Credit Party or any of its Subsidiaries shall generally not, or shall
be unable to, or shall admit in writing its inability to, pay its debts as they
become due; or
(f) Any final, non-appealable judgments or decrees shall be entered
against any Credit Party or any of its Subsidiaries involving in the aggregate a
liability (to the extent not paid when due or covered by insurance) of
$25,000,000 or more and any such judgments or decrees shall not have been paid
and satisfied, vacated, discharged or stayed within 10 days from the entry
thereof; or
(g) (i) Any Person shall engage in any "prohibited transaction" (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan,
(ii) any "accumulated funding deficiency" (as defined in Section 302 of ERISA),
whether or not waived, shall exist with respect to any Plan or any Lien in favor
of the PBGC or a Plan (other than a Permitted Lien) shall arise on the assets of
the Borrower or any Commonly Controlled Entity, (iii) a Reportable Event shall
occur with respect to, or proceedings shall commence to have a trustee
appointed, or a trustee shall be appointed, to administer or to terminate, any
Single Employer Plan, which Reportable Event or commencement of proceedings or
appointment of a Trustee is, in the reasonable opinion of the Required Lenders,
likely to result in the termination of such Plan for purposes of Title IV of
ERISA, (iv) any Single Employer Plan shall terminate for purposes of Title IV of
ERISA, (v) the Borrower, any of its Subsidiaries or any Commonly Controlled
Entity shall, or in the reasonable opinion of the Required Lenders is likely to,
incur any liability in connection with a withdrawal from, or the Insolvency or
Reorganization of, any Multiemployer Plan or (vi) any other similar event or
condition shall occur or exist with respect to a Plan; and in each case in
clauses (i) through (vi) above, such event or condition, together with all other
such events or conditions, if any, could have a Material Adverse Effect; or
(h) There shall occur a Change of Control; or
(i) The Guaranty or any provision thereof shall cease to be in full
force and effect or any Guarantor or any Person acting by or on behalf of any
Guarantor shall deny or disaffirm any Guarantor's obligations under the
Guaranty; or
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(j) Any other Credit Document shall fail to be in full force and effect
or to give the Administrative Agent and/or the Lenders the rights, powers and
privileges purported to be created thereby, or any Credit Party or any Person
acting by or on behalf of any Credit Party shall deny or disaffirm any Credit
Party Obligation.
8.2 Acceleration; Remedies.
Upon the occurrence and during the continuance of an Event of Default,
the Administrative Agent may, or upon the request and direction of the Required
Lenders shall, by written notice to the Borrower take any of the following
actions:
(i) Termination of Commitments. Declare the Commitments
terminated whereupon the Commitments shall be immediately terminated.
(ii) Acceleration. Declare the unpaid principal of and any
accrued interest in respect of all Loans and any and all other
indebtedness or obligations (including, without limitation, Fees) of
any and every kind owing by any Credit Party to the Administrative
Agent and/or any of the Lenders hereunder to be due, whereupon the same
shall be immediately due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by
each Credit Party.
(iii) Enforcement of Rights. Exercise any and all rights and
remedies created and existing under the Credit Documents, whether at
law or in equity.
(iv) Rights Under Applicable Law. Exercise any and all rights
and remedies available to the Administrative Agent or the Lenders under
applicable law.
Notwithstanding the foregoing, if an Event of Default specified in Section
8.1(e) shall occur, then the Commitments shall automatically terminate and all
Loans, all accrued interest in respect thereof, all accrued and unpaid Fees and
other indebtedness or obligations owing to the Administrative Agent and/or any
of the Lenders hereunder automatically shall immediately become due and payable
without presentment, demand, protest or the giving of any notice or other action
by the Administrative Agent or the Lenders, all of which are hereby waived by
the Borrower.
SECTION 9
AGENCY PROVISIONS
9.1 Appointment.
Each Lender hereby irrevocably designates and appoints First Union as
the Administrative Agent of such Lender under this Credit Agreement, and each
such Lender irrevocably authorizes First Union, as the Administrative Agent for
such Lender, to take such action on its behalf under the provisions of this
Credit Agreement and to exercise such powers and perform such duties as are
expressly delegated to the Administrative Agent by the terms of
53
this Credit Agreement, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere in
this Credit Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Credit Agreement or otherwise exist against the Administrative Agent.
9.2 Delegation of Duties.
The Administrative Agent may execute any of its duties under this
Credit Agreement by or through agents or attorneys-in-fact and shall be entitled
to advice of counsel concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence or misconduct
of any agents or attorneys-in-fact selected by it with reasonable care. Without
limiting the foregoing, the Administrative Agent may appoint one of its
affiliates as its agent to perform the functions of the Administrative Agent
hereunder relating to the advancing of funds to the Borrower and distribution of
funds to the Lenders and to perform such other related functions of the
Administrative Agent hereunder as are reasonably incidental to such functions.
9.3 Exculpatory Provisions.
Neither the Administrative Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any
action lawfully taken or omitted to be taken by it or such Person under or in
connection with this Credit Agreement (except for its or such Person's own gross
negligence or willful misconduct) or (ii) responsible in any manner to any of
the Lenders for any recitals, statements, representations or warranties made by
any Credit Party or any officer thereof contained in this Credit Agreement or in
any certificate, report, statement or other document referred to or provided for
in, or received by the Administrative Agent under or in connection with, this
Credit Agreement or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of any of the Credit Documents or for any failure
of any Credit Party to perform its obligations hereunder or thereunder. The
Administrative Agent shall not be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance by any Credit Party
of any of the agreements contained in, or conditions of, this Credit Agreement,
or to inspect the properties, books or records of any Credit Party.
9.4 Reliance by Administrative Agent.
The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any Note, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document or conversation believed by it in
good faith to be genuine and correct and to have been signed, sent or made by
the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Credit Parties), independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless (a) a written notice of assignment, negotiation
or
54
transfer thereof shall have been filed with the Administrative Agent and (b) the
Administrative Agent shall have received the written agreement of such assignee
to be bound hereby as fully and to the same extent as if such assignee were an
original Lender party hereto, in each case in form satisfactory to the
Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Credit Agreement unless it
shall first receive such advice or concurrence of the Required Lenders as it
deems appropriate or it shall first be indemnified to its satisfaction by the
Lenders against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action. The Administrative Agent
shall in all cases be fully protected in acting, or in refraining from acting,
under any of the Credit Documents in accordance with a request of the Required
Lenders or all of the Lenders, as may be required under this Credit Agreement,
and such request and any action taken or failure to act pursuant thereto shall
be binding upon all the Lenders and all future holders of the Notes.
9.5 Notice of Default.
The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or the Borrower referring
to this Credit Agreement, describing such Default or Event of Default and
stating that such notice is a "notice of default". In the event that the
Administrative Agent receives such a notice, the Administrative Agent shall give
prompt notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders; provided, however, that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders except to the extent that
this Credit Agreement expressly requires that such action be taken, or not
taken, only with the consent or upon the authorization of the Required Lenders,
or all of the Lenders, as the case may be.
9.6 Non-Reliance on Administrative Agent and Other Lenders.
Each Lender expressly acknowledges that neither the Administrative
Agent nor any of its officers, directors, employees, agents, attorneys-in-fact
or affiliates has made any representation or warranty to it and that no act by
the Administrative Agent hereinafter taken, including any review of the affairs
of the Credit Parties, shall be deemed to constitute any representation or
warranty by the Administrative Agent to any Lender. Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
the Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Credit Parties and made its own decision
to make its Loans hereunder and enter into this Credit Agreement. Each Lender
also represents that it will, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Credit Agreement, and to make such investigation as it deems necessary to
inform itself as to the business, operations, property, financial and other
condition and
55
creditworthiness of the Credit Parties. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of the Credit Parties which may come
into the possession of the Administrative Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates.
9.7 Indemnification.
The Lenders agree to indemnify the Administrative Agent in its capacity
hereunder (to the extent not reimbursed by the Credit Parties and without
limiting the obligation of the Credit Parties to do so), ratably according to
their respective Commitment Percentages in effect on the date on which
indemnification is sought under this Section, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the Notes)
be imposed on, incurred by or asserted against the Administrative Agent in any
way relating to or arising out of any Credit Document or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the
Administrative Agent under or in connection with any of the foregoing; provided,
however, that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements to the extent resulting from the Administrative
Agent's gross negligence or willful misconduct, as determined by a court of
competent jurisdiction pursuant to a final non-appealable judgment. The
agreements in this Section 9.7 shall survive the termination of this Credit
Agreement and payment of the Notes and all other amounts payable hereunder.
9.8 Administrative Agent in Its Individual Capacity.
The Administrative Agent and its affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Borrower as
though the Administrative Agent were not the Administrative Agent hereunder.
With respect to its Loans made or renewed by it and any Note issued to it, the
Administrative Agent shall have the same rights and powers under this Credit
Agreement as any Lender and may exercise the same as though it were not the
Administrative Agent, and the terms "Lender" and "Lenders" shall include the
Administrative Agent in its individual capacity.
9.9 Successor Administrative Agent.
The Administrative Agent may resign as Administrative Agent upon 30
days' prior notice to the Borrower and the Lenders. If the Administrative Agent
shall resign as Administrative Agent under this Credit Agreement and the other
Credit Documents, then the Required Lenders shall appoint from among the Lenders
a successor agent for the Lenders, which successor agent shall be approved by
the Borrower, whereupon such successor agent shall succeed to the rights, powers
and duties of the Administrative Agent, and the term "Administrative Agent"
shall mean
56
such successor agent effective upon such appointment and approval, and the
former Administrative Agent's rights, powers and duties as Administrative Agent
shall be terminated, without any other or further act or deed on the part of
such former Administrative Agent or any of the parties to this Credit Agreement
or any holders of the Notes. After any retiring Administrative Agent's
resignation as Administrative Agent, the provisions of this Section 9.9 shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Administrative Agent under this Credit Agreement.
SECTION 10
MISCELLANEOUS
10.1 Amendments, Waivers and Release of Collateral.
Neither this Credit Agreement, nor any of the other Credit Documents,
nor any terms hereof or thereof may be amended, supplemented, waived or modified
except in accordance with the provisions of this Section. The Required Lenders
may, or, with the written consent of the Required Lenders, the Administrative
Agent may, from time to time, (a) enter into with the Borrower written
amendments, supplements or modifications hereto and to the other Credit
Documents for the purpose of adding any provisions to this Credit Agreement or
the other Credit Documents or changing in any manner the rights of the Lenders
or of the Borrower hereunder or thereunder or (b) waive, on such terms and
conditions as the Required Lenders may specify in such instrument, any of the
requirements of this Credit Agreement or the other Credit Documents or any
Default or Event of Default and its consequences; provided, however, that no
such waiver and no such amendment, waiver, supplement, modification or release
shall:
(i) reduce the amount or extend the scheduled date of maturity
of any Loan or Note or any installment thereon, or reduce the stated
rate of any interest or fee payable hereunder (except in connection
with a waiver of interest at the increased post-default rate) or extend
the scheduled date of any payment thereof or increase the amount or
extend the expiration date of any Lender's Commitment, in each case
without the written consent of each Lender directly affected thereby;
or
(ii) amend, modify or waive any provision of this Section 10.1
or reduce the percentage specified in the definition of Required
Lenders, without the written consent of all the Lenders; or
(iii) amend, modify or waive any provision of Section 9
without the written consent of the then Administrative Agent; or
(iv) release all or substantially all of the Guarantors from
their obligations under the Guaranty, without the written consent of
all of the Lenders; or
(v) amend, modify or waive any provision of the Credit
Documents requiring consent, approval or request of the Required
Lenders or all Lenders, without the written consent of all the Lenders;
57
provided, further, that no amendment, waiver or consent affecting the rights or
duties of the Administrative Agent under any Credit Document shall in any event
be effective, unless in writing and signed by the Administrative Agent in
addition to the Lenders required hereinabove to take such action.
Any such waiver, any such amendment, supplement or modification and any
such release shall apply equally to each of the Lenders and shall be binding
upon the Borrower, the other Credit Parties, the Lenders, the Administrative
Agent and all future holders of the Notes. In the case of any waiver, the
Borrower, the other Credit Parties, the Lenders and the Administrative Agent
shall be restored to their former position and rights hereunder and under the
outstanding Loans and Notes and other Credit Documents, and any Default or Event
of Default permanently waived shall be deemed to be cured and not continuing;
but no such waiver shall extend to any subsequent or other Default or Event of
Default, or impair any right consequent thereon.
Notwithstanding any of the foregoing to the contrary, the consent of
the Borrower shall not be required for any amendment, modification or waiver of
the provisions of Section 9 (other than the provisions of Section 9.9);
provided, however, that the Administrative Agent will provide written notice to
the Borrower of any such amendment, modification or waiver. In addition, the
Borrower and the Lenders hereby authorize the Administrative Agent to modify
this Credit Agreement by unilaterally amending or supplementing Schedule 2.1(a)
from time to time in the manner requested by the Borrower, the Administrative
Agent or any Lender in order to reflect any assignments or transfers of the
Loans as provided for hereunder; provided further, however, that the
Administrative Agent shall promptly deliver a copy of any such modification to
the Borrower and each Lender.
Notwithstanding the fact that the consent of all the Lenders is
required in certain circumstances as set forth above, (x) each Lender is
entitled to vote as such Lender sees fit on any bankruptcy reorganization plan
that affects the Loans, and each Lender acknowledges that the provisions of
Section 1126(c) of the Bankruptcy Code supersedes the unanimous consent
provisions set forth herein and (y) the Required Lenders may consent to allow a
Credit Party to use cash collateral in the context of a bankruptcy or insolvency
proceeding.
10.2 Notices.
All notices, requests and demands to or upon the respective parties
hereto to be effective shall be in writing (including by telecopy), and, unless
otherwise expressly provided herein, shall be deemed to have been duly given or
made (a) when delivered by hand, (b) when transmitted via telecopy (or other
facsimile device) to the number set out herein, (c) the day following the day on
which the same has been delivered prepaid (or pursuant to an invoice
arrangement) to a reputable national overnight air courier service, or (d) the
third Business Day following the day on which the same is sent by certified or
registered mail, postage prepaid, in each case addressed as follows in the case
of the Borrower, the other Credit Parties and the Administrative Agent, and as
set forth on Schedule 10.2 in the case of the Lenders, or to such other address
as may be hereafter notified by the respective parties hereto and any future
holders of the Notes:
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if to the Borrower or any other Credit Party:
Xx. Xxxxxx X. Xxxxxx
Executive Vice President & Chief Financial Officer
The Dial Corporation
00000 Xxxxx Xxxx Xxxxxxxxx
Xxxxxxxxxx, Xxxxxxx 00000-0000
with a copy to:
Xx. Xxxxxxxxxxx X. Xxxxxxxxxxx
Senior Vice President and General Counsel
The Dial Corporation
00000 Xxxxx Xxxx Xxxxxxxxx
Xxxxxxxxxx, Xxxxxxx 00000-0000
Telephone: 000-000-0000
Telecopy: 000-000-0000
if to the Administrative Agent:
First Union National Bank
Charlotte Plaza
000 Xxxxx Xxxxxxx Xxxxxx, XX-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attn: Syndication Agency Services
Telephone: 000-000-0000
Telecopy: 000-000-0000
with a copy to:
First Union National Bank
000 Xxxxx Xxxxxxx Xxxxxx, XX-0
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xx. Xxxxx Xxxx
Telephone: 000-000-0000
Telecopy: 000-000-0000
10.3 No Waiver; Cumulative Remedies.
No failure to exercise and no delay in exercising, on the part of the
Administrative Agent or any Lender, any right, remedy, power or privilege
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided are
cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.
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10.4 Survival of Representations and Warranties.
All representations and warranties made hereunder and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Credit Agreement and the Notes
and the making of the Loans; provided that all such representations and
warranties shall terminate on the date upon which the Commitments have been
terminated and all Credit Party Obligations have been paid in full.
10.5 Payment of Expenses and Taxes.
The Borrower agrees (a) to pay or reimburse the Administrative Agent
and the Arranger for all their reasonable out-of-pocket costs and expenses
incurred in connection with the development, preparation, negotiation, printing
and execution of, and any amendment, supplement or modification to, this Credit
Agreement and the other Credit Documents and any other documents prepared in
connection herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, together with the reasonable fees
and disbursements of counsel to the Administrative Agent and the Arranger, (b)
to pay or reimburse each Lender and the Administrative Agent for all its costs
and expenses incurred in connection with the enforcement or preservation of any
rights under this Credit Agreement and the other Credit Documents, including,
without limitation, the reasonable out-of-pocket fees and disbursements of
counsel to the Administrative Agent and to the Lenders, and (c) on demand, to
pay, indemnify, and hold each Lender and the Administrative Agent harmless from,
any and all recording and filing fees and any and all liabilities with respect
to, or resulting from any delay in paying, stamp, excise and other similar
taxes, if any, which may be payable or determined to be payable in connection
with the execution and delivery of, or consummation or administration of any of
the transactions contemplated by, or any amendment, supplement or modification
of, or any waiver or consent under or in respect of, the Credit Documents and
any such other documents, and (d) to pay, indemnify, and hold each Lender and
the Administrative Agent and their Affiliates harmless from and against, any and
all other liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever with respect to the execution, delivery, enforcement, performance and
administration of the Credit Documents and any such other documents and the use,
or proposed use, of proceeds of the Loans (all of the foregoing, collectively,
the "indemnified liabilities"); provided, however, that the Borrower shall not
have any obligation hereunder to the Administrative Agent or any Lender with
respect to indemnified liabilities arising from the gross negligence or willful
misconduct of the Administrative Agent or any such Lender, as determined by a
court of competent jurisdiction pursuant to a final non-appealable judgment. The
agreements in this Section 10.5 shall survive repayment of the Loans, Notes and
all other Credit Party Obligations.
10.6 Successors and Assigns; Participations; Purchasing Lenders.
(a) This Credit Agreement shall be binding upon and inure to the
benefit of the Borrower, the Lenders, the Administrative Agent, all future
holders of the Notes and their respective successors and assigns, except that
the Borrower may not assign or transfer any of its
60
rights or obligations under this Credit Agreement or the other Credit Documents
without the prior written consent of each Lender.
(b) Any Lender may, in the ordinary course of its commercial banking
business and in accordance with applicable law, at any time sell to one or more
banks or other entities ("Participants") participating interests in any Loan
owing to such Lender, any Note held by such Lender, any Commitment of such
Lender, or any other interest of such Lender hereunder. In the event of any such
sale by a Lender of participating interests to a Participant, such Lender's
obligations under this Credit Agreement to the other parties to this Credit
Agreement shall remain unchanged, such Lender shall remain solely responsible
for the performance thereof, such Lender shall remain the holder of any such
Note for all purposes under this Credit Agreement, and the Borrower and the
Administrative Agent shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations under this Credit
Agreement. No Lender shall transfer or grant any participation under which the
Participant shall have rights to approve any amendment to or waiver of this
Credit Agreement or any other Credit Document except to the extent such
amendment or waiver would (i) extend the scheduled maturity of any Loan or Note
or any installment thereon in which such Participant is participating, or reduce
the stated rate or extend the time of payment of interest or fees thereon
(except in connection with a waiver of interest at the increased post-default
rate) or reduce the principal amount thereof, or increase the amount of the
Participant's participation over the amount thereof then in effect (it being
understood that a waiver of any Default or Event of Default shall not constitute
a change in the terms of such participation, and that an increase in any
Commitment or Loan shall be permitted without consent of any Participant if the
Participant's participation is not increased as a result thereof), (ii) release
all or substantially all of the Guarantors from their obligations under the
Guaranty, or (iii) consent to the assignment or transfer by the Borrower of any
of its rights and obligations under this Credit Agreement. In the case of any
such participation, the Participant shall not have any rights under this Credit
Agreement or any of the other Credit Documents (the Participant's rights against
such Lender in respect of such participation to be those set forth in the
agreement executed by such Lender in favor of the Participant relating thereto)
and all amounts payable by the Borrower hereunder shall be determined as if such
Lender had not sold such participation; provided that each Participant shall be
entitled to the benefits of Sections 3.10, 3.11, 3.12 and 10.5 with respect to
its participation in the Commitments and the Loans outstanding from time to
time; provided further, that no Participant shall be entitled to receive any
greater amount pursuant to such Sections than the transferor Lender would have
been entitled to receive in respect of the amount of the participation
transferred by such transferor Lender to such Participant had no such transfer
occurred.
(c) Any Lender may, in the ordinary course of its commercial banking
business and in accordance with applicable law, at any time, sell or assign to
any Lender or any Affiliate or Related Fund thereof and, with the consent of the
Administrative Agent and, so long as no Event of Default has occurred and is
continuing, the Borrower (in each case, which consent shall not be unreasonably
withheld), to one or more additional banks or financial institutions or entities
("Purchasing Lenders"), all or any part of its rights and obligations under this
Credit Agreement and the Notes in minimum amounts of $5,000,000 with respect to
its Commitment and Loans (or, if less, the entire amount of such Lender's
obligations), pursuant to a Commitment Transfer
61
Supplement, executed by such Purchasing Lender and such transferor Lender (and,
to the extent required above, the Administrative Agent and the Borrower), and
delivered to the Administrative Agent for its acceptance and recording in the
Register; provided, however, that any sale or assignment to an existing Lender
shall not require the consent of the Administrative Agent or the Borrower nor
shall any such sale or assignment be subject to the minimum assignment amounts
specified herein. Upon such execution, delivery, acceptance and recording, from
and after the Transfer Effective Date specified in such Commitment Transfer
Supplement, (x) the Purchasing Lender thereunder shall be a party hereto and, to
the extent provided in such Commitment Transfer Supplement, have the rights and
obligations of a Lender hereunder with a Commitment as set forth therein, and
(y) the transferor Lender thereunder shall, to the extent provided in such
Commitment Transfer Supplement, be released from its obligations under this
Credit Agreement (and, in the case of a Commitment Transfer Supplement covering
all or the remaining portion of a transferor Lender's rights and obligations
under this Credit Agreement, such transferor Lender shall cease to be a party
hereto; provided, however, that such Lender shall still be entitled to any
indemnification rights hereunder). Such Commitment Transfer Supplement shall be
deemed to amend this Credit Agreement to the extent, and only to the extent,
necessary to reflect the addition of such Purchasing Lender and the resulting
adjustment of Commitment Percentages arising from the purchase by such
Purchasing Lender of all or a portion of the rights and obligations of such
transferor Lender under this Credit Agreement and the Notes. On or prior to the
Transfer Effective Date specified in such Commitment Transfer Supplement, the
Borrower shall execute and deliver to the Administrative Agent in exchange for
the Notes delivered to the Administrative Agent pursuant to such Commitment
Transfer Supplement new Notes to the order of such Purchasing Lender in an
amount equal to the Commitment assumed by it pursuant to such Commitment
Transfer Supplement and, unless the transferor Lender has not retained a
Commitment hereunder, new Notes to the order of the transferor Lender in an
amount equal to the Commitment retained by it hereunder. Such new Notes shall be
dated the Closing Date and shall otherwise be in the form of the Notes replaced
thereby. The Notes surrendered by the transferor Lender shall be returned by the
Administrative Agent to the Borrower marked "canceled".
(d) The Administrative Agent shall maintain at its address referred to
in Section 10.2 a copy of each Commitment Transfer Supplement delivered to it
and a register (the "Register") for the recordation of the names and addresses
of the Lenders and the Commitment of, and principal amount of the Loans owing
to, each Lender from time to time. The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register as the owner of the Loan recorded therein for all
purposes of this Credit Agreement. The Register shall be available for
inspection by the Borrower or any Lender at any reasonable time and from time to
time upon reasonable prior notice.
(e) Upon its receipt of a duly executed Commitment Transfer Supplement,
together with payment to the Administrative Agent by the transferor Lender or
the Purchasing Lender, as agreed between them, of a registration and processing
fee of $3,500.00 for each Purchasing Lender listed in such Commitment Transfer
Supplement and the Notes subject to such Commitment Transfer Supplement, the
Administrative Agent shall (i) accept such Commitment
62
Transfer Supplement, (ii) record the information contained therein in the
Register and (iii) give prompt notice of such acceptance and recordation to the
Lenders and the Borrower.
(f) The Borrower authorizes each Lender to disclose to any Participant
or Purchasing Lender (each, a "Transferee") and any prospective Transferee any
and all financial information in such Lender's possession concerning the
Borrower and its Affiliates which has been delivered to such Lender by or on
behalf of the Borrower pursuant to this Credit Agreement or which has been
delivered to such Lender by or on behalf of the Borrower in connection with such
Lender's credit evaluation of the Borrower and its Subsidiaries prior to
becoming a party to this Credit Agreement, in each case subject to Section
10.16.
(g) At the time of each assignment pursuant to this Section 10.6 to a
Person which is not already a Lender hereunder and which is not a United States
person (as such term is defined in Section 7701(a)(30) of the Code) for Federal
income tax purposes, the respective assignee Lender shall provide to the
Borrower and the Administrative Agent the appropriate Internal Revenue Service
Forms (and, if applicable, a 3.13 Certificate) described in Section 3.13.
(h) Nothing herein shall prohibit any Lender from pledging or assigning
any of its rights under this Credit Agreement (including, without limitation,
any right to payment of principal and interest under any Note) to any Federal
Reserve Bank in accordance with applicable laws.
10.7 Adjustments; Set-off.
(a) Each Lender agrees that if any Lender (a "benefited Lender") shall
at any time receive any payment of all or part of its Loans, or interest
thereon, or receive any collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, pursuant to events or proceedings of the nature
referred to in Section 8.1(e), or otherwise) in a greater proportion than any
such payment to or collateral received by any other Lender, if any, in respect
of such other Lender's Loans, or interest thereon, such benefited Lender shall
purchase for cash from the other Lenders a participating interest in such
portion of each such other Lender's Loan, or shall provide such other Lenders
with the benefits of any such collateral, or the proceeds thereof, as shall be
necessary to cause such benefited Lender to share the excess payment or benefits
of such collateral or proceeds ratably with each of the Lenders; provided,
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such benefited Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest. The Borrower agrees that each Lender so
purchasing a portion of another Lender's Loans may exercise all rights of
payment (including, without limitation, rights of set-off) with respect to such
portion as fully as if such Lender were the direct holder of such portion.
(b) In addition to any rights and remedies of the Lenders provided by
law (including, without limitation, other rights of set-off), each Lender shall
have the right, without prior notice to any Credit Party, any such notice being
expressly waived by the Credit Parties to the extent permitted by applicable
law, upon the occurrence of any Event of Default, to setoff and appropriate and
apply any and all deposits (general or special, time or demand, provisional or
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final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by such Lender or any branch or
agency thereof to or for the credit or the account of any Credit Party, or any
part thereof in such amounts as such Lender may elect, against and on account of
the obligations and liabilities of the Borrower and the other Credit Parties to
such Lender hereunder and claims of every nature and description of such Lender
against the Borrower and the other Credit Parties, in any currency, whether
arising hereunder, under the Notes or under any documents contemplated by or
referred to herein or therein, as such Lender may elect, whether or not such
Lender has made any demand for payment and although such obligations,
liabilities and claims may be contingent or unmatured. The aforesaid right of
set-off may be exercised by such Lender against any Credit Party or against any
trustee in bankruptcy, debtor in possession, assignee for the benefit of
creditors, receiver or execution, judgment or attachment creditor of any such
Credit Party, or against anyone else claiming through or against any such Credit
Party or any such trustee in bankruptcy, debtor in possession, assignee for the
benefit of creditors, receiver, or execution, judgment or attachment creditor,
notwithstanding the fact that such right of set-off shall not have been
exercised by such Lender prior to the occurrence of any Event of Default. Each
Lender agrees promptly to notify the applicable Credit Party and the
Administrative Agent after any such set-off and application made by such Lender;
provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application.
10.8 Table of Contents and Section Headings.
The table of contents and the Section and subsection headings herein
are intended for convenience only and shall be ignored in construing this Credit
Agreement.
10.9 Counterparts.
This Credit Agreement may be executed by one or more of the parties to
this Credit Agreement on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
agreement.
10.10 Effectiveness.
This Credit Agreement shall become effective on the date on which all
of the parties have signed a copy hereof (whether the same or different copies)
and shall have delivered the same to the Administrative Agent (or counsel to the
Administrative Agent) or, in the case of the Lenders, shall have given to the
Administrative Agent written, telecopied or telex notice (actually received) at
such office that the same has been signed and mailed to it.
10.11 Severability.
Any provision of this Credit Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition
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or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10.12 Integration.
This Credit Agreement and the other Credit Documents represent the
agreement of the Borrower, the Administrative Agent and the Lenders with respect
to the subject matter hereof, and there are no promises, undertakings,
representations or warranties by the Administrative Agent, the Borrower or any
Lender relative to the subject matter hereof not expressly set forth or referred
to herein or in the other Credit Documents.
10.13 Governing Law.
This Credit Agreement and the other Credit Documents and the rights and
obligations of the parties under this Credit Agreement and the other Credit
Documents shall be governed by, and construed and interpreted in accordance
with, the law of the State of North Carolina.
10.14 Consent to Jurisdiction and Service of Process.
All judicial proceedings brought against the Borrower and/or any other
Credit Party with respect to this Credit Agreement, any Note or any of the other
Credit Documents may be brought in any state or federal court of competent
jurisdiction in the State of North Carolina, and, by execution and delivery of
this Credit Agreement, each of the Borrower and the other Credit Parties
accepts, for itself and in connection with its properties, generally and
unconditionally, the non-exclusive jurisdiction of the aforesaid courts and
irrevocably agrees to be bound by any final judgment rendered thereby in
connection with this Credit Agreement, any Note or any other Credit Document
from which no appeal has been taken or is available. Each of the Borrower and
the other Credit Parties irrevocably agrees that all service of process in any
such proceedings in any such court may be effected by mailing a copy thereof by
registered or certified mail (or any substantially similar form of mail),
postage prepaid, to it at its address set forth in Section 10.2 or at such other
address of which the Administrative Agent shall have been notified pursuant
thereto, such service being hereby acknowledged by the each of the Borrower and
the other Credit Parties to be effective and binding service in every respect.
Each of the Borrower, the other Credit Parties, the Administrative Agent and the
Lenders irrevocably waives any objection, including, without limitation, any
objection to the laying of venue based on the grounds of forum non conveniens
which it may now or hereafter have to the bringing of any such action or
proceeding in any such jurisdiction. Nothing herein shall affect the right to
serve process in any other manner permitted by law or shall limit the right of
any Lender to bring proceedings against the Borrower or the other Credit Parties
in the court of any other jurisdiction.
10.15 Arbitration.
(a) Notwithstanding the provisions of Section 10.14 to the contrary,
upon demand of any party hereto, whether made before or within three (3) months
after institution of any judicial proceeding, any dispute, claim or controversy
arising out of, connected with or relating to this Credit Agreement and other
Credit Documents ("Disputes") between or among parties to this
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Credit Agreement shall be resolved by binding arbitration as provided herein.
Institution of a judicial proceeding by a party does not waive the right of that
party to demand arbitration hereunder. Disputes may include, without limitation,
tort claims, counterclaims, disputes as to whether a matter is subject to
arbitration, claims brought as class actions, claims arising from Credit
Documents executed in the future, or claims arising out of or connected with the
transaction reflected by this Credit Agreement.
Arbitration shall be conducted under and governed by the Commercial
Arbitration Rules (the "Arbitration Rules") of the American Arbitration
Association (the "AAA") and Title 9 of the U.S. Code. All arbitration hearings
shall be conducted in New York, New York. A hearing shall begin within 90 days
of demand for arbitration and all hearings shall be concluded within 120 days of
demand for arbitration. These time limitations may not be extended unless a
party shows cause for extension and then no more than a total extension of 60
days. The expedited procedures set forth in Rule 51 et seq. of the Arbitration
Rules shall be applicable to claims of less than $1,000,000. All applicable
statutes of limitation shall apply to any Dispute. A judgment upon the award may
be entered in any court having jurisdiction. Arbitrators shall be licensed
attorneys selected from the Commercial Financial Dispute Arbitration Panel of
the AAA. The parties hereto do not waive applicable Federal or state substantive
law except as provided herein.
(b) Notwithstanding the preceding binding arbitration provisions, the
Administrative Agent, the Lenders, the Borrower and the other Credit Parties
agree to preserve, without diminution, certain remedies that the Administrative
Agent on behalf of the Lenders may employ or exercise freely, independently or
in connection with an arbitration proceeding or after an arbitration action is
brought. The Administrative Agent on behalf of the Lenders shall have the right
to proceed in any court of proper jurisdiction or by self-help to exercise or
prosecute the following remedies, as applicable (i) obtaining provisional or
ancillary remedies including injunctive relief, sequestration, garnishment,
attachment, appointment of receiver and filing an involuntary bankruptcy
proceeding; and (ii) when applicable, a judgment by confession of judgment.
Preservation of these remedies does not limit the power of an arbitrator to
grant similar remedies that may be requested by a party in a Dispute.
(c) The parties hereto agree that they shall not have a remedy of
punitive or exemplary damages against the other in any Dispute and hereby waive
any right or claim to punitive or exemplary damages they have now or which may
arise in the future in connection with any Dispute whether the Dispute is
resolved by arbitration or judicially.
(d) By execution and delivery of this Credit Agreement, each of the
parties hereto accepts, for itself and in connection with its properties,
generally and unconditionally, the non-exclusive jurisdiction relating to any
arbitration proceedings conducted under the Arbitration Rules in New York, New
York and irrevocably agrees to be bound by any final judgment rendered thereby
in connection with this Credit Agreement from which no appeal has been taken or
is available.
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10.16 Confidentiality.
The Administrative Agent and each of the Lenders agrees that it shall
not disclose without the prior consent of the Borrower (other than to its
employees, affiliates, auditors or counsel or to another Lender) any information
with respect to the Borrower and its Subsidiaries which is furnished pursuant to
this Credit Agreement, any other Credit Document or any documents contemplated
by or referred to herein or therein and which is designated by the Borrower to
the Lenders in writing as confidential or as to which it is otherwise reasonably
clear such information is not public, except that any Lender may disclose any
such information (a) as has become generally available to the public other than
by a breach of this Section 10.16, (b) as may be required in any report,
statement or testimony submitted to any municipal, state or federal regulatory
body having or claiming to have jurisdiction over such Lender or to the Federal
Reserve Board or the Federal Deposit Insurance Corporation or the OCC or the
NAIC or similar organizations (whether in the United States or elsewhere) or
their successors, (c) as may be required in response to any summons or subpoena
or any law, order, regulation or ruling applicable to such Lender, (d) to any
prospective Participant or assignee in connection with any contemplated transfer
pursuant to Section 10.6; provided that such prospective transferee shall have
been made aware of this Section 10.16 and has agreed to be bound thereby or (e)
to Gold Sheets and other similar bank trade publications, such information to
consist of deal terms and other information regarding the credit facilities
evidenced by this Credit Agreement customarily found in such publications.
10.17 Acknowledgments.
The Borrower and the other Credit Parties each hereby acknowledges
that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of each Credit Document;
(b) neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to the Borrower or any other Credit Party arising out
of or in connection with this Credit Agreement and the relationship between
Administrative Agent and Lenders, on one hand, and the Borrower and the other
Credit Parties, on the other hand, in connection herewith is solely that of
debtor and creditor; and
(c) no joint venture exists among the Lenders or among the Borrower or
the other Credit Parties and the Lenders.
10.18 Waivers of Jury Trial.
THE BORROWER, THE OTHER CREDIT PARTIES, THE ADMINISTRATIVE AGENT AND
THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING
RELATING TO THIS CREDIT AGREEMENT OR ANY OTHER CREDIT DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.
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SECTION 11
GUARANTY
11.1 The Guaranty.
In order to induce the Lenders to enter into this Credit Agreement and
to extend credit hereunder and in recognition of the direct benefits to be
received by the Guarantors from the Extensions of Credit hereunder, each of the
Guarantors hereby agrees with the Administrative Agent and the Lenders as
follows: the Guarantor hereby unconditionally and irrevocably jointly and
severally guarantees as primary obligor and not merely as surety the full and
prompt payment when due, whether upon maturity, by acceleration or otherwise, of
any and all Credit Party Obligations. If any or all of the Credit Party
Obligations becomes due and payable hereunder, each Guarantor unconditionally
promises to pay such Credit Party Obligations to the Administrative Agent and
the Lenders, or order, or demand, together with any and all reasonable expenses
which may be incurred by the Administrative Agent or the Lenders in collecting
any of the Credit Party Obligations.
Notwithstanding any provision to the contrary contained herein or in
any other of the Credit Documents, to the extent the obligations of a Guarantor
shall be adjudicated to be invalid or unenforceable for any reason (including,
without limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers) then the obligations of each such Guarantor
hereunder shall be limited to the maximum amount that is permissible under
applicable law (whether federal or state and including, without limitation, the
Bankruptcy Code).
11.2 Bankruptcy.
Additionally, each of the Guarantors unconditionally and irrevocably
guarantees jointly and severally the payment of any and all Credit Party
Obligations of the Borrower to the Lenders whether or not due or payable by the
Borrower upon the occurrence of any of the events specified in Section 8.1(e),
and unconditionally promises to pay such Credit Party Obligations to the
Administrative Agent for the account of the Lenders, or order, on demand, in
lawful money of the United States. Each of the Guarantors further agrees that to
the extent that the Borrower or a Guarantor shall make a payment or a transfer
of an interest in any property to the Administrative Agent or any Lender, which
payment or transfer or any part thereof is subsequently invalidated, declared to
be fraudulent or preferential, or otherwise is avoided, and/or required to be
repaid to the Borrower or a Guarantor, the estate of the Borrower or a
Guarantor, a trustee, receiver or any other party under any bankruptcy law,
state or federal law, common law or equitable cause, then to the extent of such
avoidance or repayment, the obligation or part thereof intended to be satisfied
shall be revived and continued in full force and effect as if said payment had
not been made.
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11.3 Nature of Liability.
The liability of each Guarantor hereunder is exclusive and independent
of any security for or other guaranty of the Credit Party Obligations of the
Borrower whether executed by any such Guarantor, any other guarantor or by any
other party, and no Guarantor's liability hereunder shall be affected or
impaired by (a) any direction as to application of payment by the Borrower or by
any other party, or (b) any other continuing or other guaranty, undertaking or
maximum liability of a guarantor or of any other party as to the Credit Party
Obligations of the Borrower, or (c) any payment on or in reduction of any such
other guaranty or undertaking, or (d) any dissolution, termination or increase,
decrease or change in personnel by the Borrower, or (e) any payment made to the
Administrative Agent or the Lenders on the Credit Party Obligations which the
Administrative Agent or such Lenders repay the Borrower pursuant to court order
in any bankruptcy, reorganization, arrangement, moratorium or other debtor
relief proceeding, and each of the Guarantors waives any right to the deferral
or modification of its obligations hereunder by reason of any such proceeding.
11.4 Independent Obligation.
The obligations of each Guarantor hereunder are independent of the
obligations of any other guarantor or the Borrower, and a separate action or
actions may be brought and prosecuted against each Guarantor whether or not
action is brought against any other guarantor or the Borrower and whether or not
any other Guarantor or the Borrower is joined in any such action or actions.
11.5 Authorization.
Each of the Guarantors authorizes the Administrative Agent and each
Lender without notice or demand (except as shall be required by applicable
statute and cannot be waived), and without affecting or impairing its liability
hereunder, from time to time to (a) renew, compromise, extend, increase,
accelerate or otherwise change the time for payment of, or otherwise change the
terms of the Credit Party Obligations or any part thereof in accordance with
this Credit Agreement, including any increase or decrease of the rate of
interest thereon, (b) take and hold security from any guarantor or any other
party for the payment of this Guaranty or the Credit Party Obligations and
exchange, enforce waive and release any such security, (c) apply such security
and direct the order or manner of sale thereof as the Administrative Agent and
the Lenders in their discretion may determine and (d) release or substitute any
one or more endorsers, guarantors, the Borrower or other obligors.
11.6 Reliance.
It is not necessary for the Administrative Agent or the Lenders to
inquire into the capacity or powers of the Borrower or the officers, directors,
members, partners or agents acting or purporting to act on its behalf, and any
indebtedness made or created in reliance upon the professed exercise of such
powers shall be guaranteed hereunder.
69
11.7 Waiver.
(a) Each of the Guarantors waives any right (except as shall be
required by applicable statute and cannot be waived) to require the
Administrative Agent or any Lender to (i) proceed against the Borrower, any
other guarantor or any other party, (ii) proceed against or exhaust any security
held from the Borrower, any other guarantor or any other party, or (iii) pursue
any other remedy in the Administrative Agent's or any Lender's power whatsoever.
Each of the Guarantors waives any defense based on or arising out of any defense
of the Borrower, any other guarantor or any other party other than payment in
full of the Credit Party Obligations, including without limitation any defense
based on or arising out of the disability of the Borrower, any other guarantor
or any other party, or the unenforceability of the Credit Party Obligations or
any part thereof from any cause, or the cessation from any cause of the
liability of the Borrower other than payment in full of the Credit Party
Obligations. The Administrative Agent or any of the Lenders may, at their
election, foreclose on any security held by the Administrative Agent or a Lender
by one or more judicial or nonjudicial sales, whether or not every aspect of any
such sale is commercially reasonable (to the extent such sale is permitted by
applicable law), or exercise any other right or remedy the Administrative Agent
and any Lender may have against the Borrower or any other party, or any
security, without affecting or impairing in any way the liability of any
Guarantor hereunder except to the extent the Credit Party Obligations have been
paid in full. Each of the Guarantors waives any defense arising out of any such
election by the Administrative Agent and each of the Lenders, even though such
election operates to impair or extinguish any right of reimbursement or
subrogation or other right or remedy of the Guarantors against the Borrower or
any other party or any security.
(b) Each of the Guarantors waives all presentments, demands for
performance, protests and notices, including without limitation notices of
nonperformance, notice of protest, notices of dishonor, notices of acceptance of
this Guaranty, and notices of the existence, creation or incurring of new or
additional Credit Party Obligations. Each Guarantor assumes all responsibility
for being and keeping itself informed of the Borrower's financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the Credit Party Obligations and the nature, scope and extent of the risks which
such Guarantor assumes and incurs hereunder, and agrees that neither the
Administrative Agent nor any Lender shall have any duty to advise such Guarantor
of information known to it regarding such circumstances or risks.
(c) Each of the Guarantors hereby agrees it will not exercise any
rights of subrogation which it may at any time otherwise have as a result of
this Guaranty (whether contractual, under Section 509 of the U.S. Bankruptcy
Code, or otherwise) to the claims of the Lenders against the Borrower or any
other guarantor of the Credit Party Obligations of the Borrower owing to the
Lenders (collectively, the "Other Parties") and all contractual, statutory or
common law rights of reimbursement, contribution or indemnity from any Other
Party which it may at any time otherwise have as a result of this Guaranty until
such time as the Credit Party Obligations shall have been paid in full and the
Commitments have been terminated. Each of the Guarantors hereby further agrees
not to exercise any right to enforce any other remedy which the Administrative
Agent and the Lenders now have or may hereafter have against any Other Party,
any endorser or any other guarantor of all or any part of the Credit Party
Obligations of the Borrower and any benefit of, and any right to participate in,
any security or collateral given to or
70
for the benefit of the Lenders to secure payment of the Credit Party Obligations
of the Borrower until such time as the Credit Party Obligations shall have been
paid in full and the Commitments have been terminated.
11.8 Limitation on Enforcement.
The Lenders agree that this Guaranty may be enforced only by the action
of the Administrative Agent acting upon the instructions of the Required Lenders
and that no Lender shall have any right individually to seek to enforce or to
enforce this Guaranty, it being understood and agreed that such rights and
remedies may be exercised by the Administrative Agent for the benefit of the
Lenders under the terms of this Credit Agreement. The Lenders further agree that
this Guaranty may not be enforced against any director, officer, employee or
stockholder of the Guarantors.
11.9 Confirmation of Payment.
The Administrative Agent and the Lenders will, upon request after
payment of the Credit Party Obligations which are the subject of this Guaranty
and termination of the Commitments relating thereto, confirm to the Borrower,
the Guarantors or any other Person that the Credit Party Obligations have been
paid in full and the Commitments relating thereto terminated, subject to the
provisions of Section 11.2.
[Remainder of Page Intentionally Left Blank]
71
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Credit Agreement to be duly executed and delivered as of the date first
above written.
BORROWER: THE DIAL CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President
and Chief Financial Officer
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Senior Vice President & Treasurer
GUARANTORS: DIAL BRANDS, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Treasurer & Controller
DIAL BRANDS HOLDING, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Treasurer & Controller
DIAL INTERNATIONAL, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President & Treasurer
[Signature Pages Continue]
GUARANTORS cont.: DIAL BENEFITS MANAGEMENT
CORPORATION
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Treasurer
DIAL POST-RETIREMENT LIABILITIES
MANAGEMENT COMPANY
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President & Treasurer
[Signature Pages Continue]
LENDERS: FIRST UNION NATIONAL BANK,
individually in its capacity as a
Lender and in its capacity as Administrative
Agent
By: /s/ Xxx Xxxxxxx
-----------------------------------------
Name: Xxx Xxxxxxx
Title: Director
BANK OF AMERICA, N.A.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Managing Director
BANK ONE, NA
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Director
CREDIT LYONNAIS LOS ANGELES BRANCH
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President and Manager
THREE YEAR CREDIT AGREEMENT
Dated as of March 27, 2002
among
THE DIAL CORPORATION
as Borrower,
CERTAIN DOMESTIC SUBSIDIARIES OF THE BORROWER
FROM TIME TO TIME PARTIES HERETO
as Guarantors,
THE LENDERS NAMED HEREIN
and
FIRST UNION NATIONAL BANK,
as Administrative Agent
FIRST UNION SECURITIES, INC.,
d/b/a WACHOVIA SECURITIES
as Lead Arranger and Book Manager
TABLE OF CONTENTS
SECTION 1 DEFINITIONS ...........................................................................1
1.1 Definitions..........................................................1
1.2 Computation of Time Periods..........................................19
1.3 Accounting Terms.....................................................19
SECTION 2 CREDIT FACILITY .......................................................................20
2.1 Revolving Loans......................................................20
SECTION 3 OTHER PROVISIONS RELATING TO CREDIT FACILITIES ........................................22
3.1 Default Rate.........................................................22
3.2 Extension and Conversion.............................................22
3.3 Prepayments..........................................................23
3.4 Termination, Reduction and Increase of Commitments...................23
3.5 Fees.................................................................24
3.6 Computation of Interest and Fees.....................................25
3.7 Pro Rata Treatment and Payments......................................25
3.8 Non-Receipt of Funds by the Administrative Agent.....................27
3.9 Inability to Determine Interest Rate.................................28
3.10 Illegality...........................................................28
3.11 Requirements of Law..................................................29
3.12 Indemnity............................................................30
3.13 Taxes................................................................30
SECTION 4 CONDITIONS ............................................................................32
4.1 Conditions to Closing................................................32
4.2 Conditions to All Loans..............................................35
SECTION 5 REPRESENTATIONS AND WARRANTIES ........................................................35
5.1 Financial Condition..................................................35
5.2 No Material Adverse Change...........................................36
5.3 Organization; Existence..............................................36
5.4 Power; Authorization; Enforceable Obligations........................36
5.5 Conflict.............................................................37
5.6 No Material Litigation...............................................37
5.7 No Default...........................................................37
5.8 Taxes................................................................37
5.9 ERISA................................................................38
5.10 Governmental Regulations, Etc........................................38
5.11 Subsidiaries.........................................................39
5.12 Use of Proceeds......................................................39
5.13 Compliance with Laws; Contractual Obligations........................39
5.14 Accuracy and Completeness of Information.............................39
5.15 Environmental Matters................................................39
5.16 Solvency.............................................................40
i
5.17 No Burdensome Restrictions...........................................40
5.18 Material Contracts...................................................40
5.19 Insurance............................................................40
SECTION 6 AFFIRMATIVE COVENANTS .................................................................40
6.1 Financial Statements.................................................40
6.2 Certificates; Other Information......................................41
6.3 Notices..............................................................42
6.4 Maintenance of Existence; Compliance with Laws; Contractual
Obligations..........................................................43
6.5 Maintenance of Property; Insurance...................................43
6.6 Inspection of Property; Books and Records; Discussions...............43
6.7 Financial Covenants..................................................43
6.9 Additional Guarantors................................................44
6.10 Payment of Obligations...............................................44
6.11 Environmental Laws...................................................44
SECTION 7 NEGATIVE COVENANTS ....................................................................45
7.1 Indebtedness.........................................................45
7.2 Liens................................................................46
7.3 Nature of Business...................................................46
7.4 Consolidation, Merger, Sale or Purchase of Assets, etc...............46
7.5 Advances, Investments and Loans......................................47
7.6 Transactions with Affiliates.........................................47
7.7 Fiscal Year; Organizational Documents; Material Contracts............47
7.8 Limitation on Restricted Actions.....................................48
7.9 Restricted Payments..................................................48
7.10 Sale Leasebacks......................................................48
SECTION 8 EVENTS OF DEFAULT .....................................................................49
8.1 Events of Default....................................................49
8.2 Acceleration; Remedies...............................................51
SECTION 9 AGENCY PROVISIONS .....................................................................52
9.1 Appointment..........................................................52
9.2 Delegation of Duties.................................................52
9.3 Exculpatory Provisions...............................................52
9.4 Reliance by Administrative Agent.....................................53
9.5 Notice of Default....................................................53
9.6 Non-Reliance on Administrative Agent and Other Lenders...............54
9.7 Indemnification......................................................54
9.8 Administrative Agent in Its Individual Capacity......................55
9.9 Successor Administrative Agent.......................................55
SECTION 10 MISCELLANEOUS ........................................................................55
10.1 Amendments, Waivers and Release of Collateral........................55
10.2 Notices..............................................................57
ii
10.3 No Waiver; Cumulative Remedies.......................................58
10.4 Survival of Representations and Warranties...........................58
10.5 Payment of Expenses and Taxes........................................58
10.6 Successors and Assigns; Participations; Purchasing Lenders...........59
10.7 Adjustments; Set-off.................................................62
10.8 Table of Contents and Section Headings...............................63
10.9 Counterparts.........................................................63
10.10 Effectiveness........................................................63
10.11 Severability.........................................................63
10.12 Integration..........................................................63
10.13 Governing Law........................................................63
10.14 Consent to Jurisdiction and Service of Process.......................64
10.15 Arbitration..........................................................64
10.16 Confidentiality......................................................65
10.17 Acknowledgments......................................................66
10.18 Waivers of Jury Trial................................................66
SECTION 11 GUARANTY .............................................................................66
11.1 The Guaranty.........................................................66
11.2 Bankruptcy...........................................................67
11.3 Nature of Liability..................................................67
11.4 Independent Obligation...............................................67
11.5 Authorization........................................................68
11.6 Reliance.............................................................68
11.7 Waiver...............................................................68
11.8 Limitation on Enforcement............................................69
11.9 Confirmation of Payment..............................................70
iii
SCHEDULES
Schedule 1.1-1 Form of Account Designation Letter
Schedule 1.1-2 Permitted Liens
Schedule 2.1(a) Schedule of Lenders and Commitments
Schedule 2.1(b)(i) Form of Notice of Borrowing
Schedule 2.1(e) Form of Revolving Note
Schedule 3.2 Form of Notice of Extension/Conversion
Schedule 3.4(c) New Commitment Agreement
Schedule 3.13 3.13 Certificate
Schedule 4.1(e) Form of Secretary's Certificate
Schedule 4.1(j) Material Adverse Effect
Schedule 5.6 Material Litigation
Schedule 5.11 Subsidiaries
Schedule 5.18 Material Contracts
Schedule 6.2(a) Form of Officer's Compliance Certificate
Schedule 6.9 Form of Joinder Agreement
Schedule 7.1(b) Indebtedness
Schedule 7.5 Investments
Schedule 10.2 Schedule of Lenders' Lending Offices
Schedule 10.6(c) Form of Commitment Transfer Supplement
iv
THREE YEAR CREDIT AGREEMENT
THIS THREE YEAR CREDIT AGREEMENT dated as of March 27, 2002 (the
"Credit Agreement"), is by and among THE DIAL CORPORATION, a Delaware
corporation (the "Borrower"), certain Domestic Subsidiaries of the Borrower
listed on the signature pages hereto and as may from time to time become a party
hereto (collectively the "Guarantors" and individually, a "Guarantor"), the
lenders named herein and such other lenders as may become a party hereto (the
"Lenders" and individually, a "Lender") and FIRST UNION NATIONAL BANK, as
Administrative Agent for the Lenders (in such capacity, the "Administrative
Agent").
W I T N E S S E T H
WHEREAS, the Borrower has requested that the Lenders provide a $75
million credit facility for the purposes hereinafter set forth; and
WHEREAS, the Lenders have agreed to make the requested credit facility
available to the Borrower on the terms and conditions hereinafter set forth.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS
1.1 Definitions.
As used in this Credit Agreement, the following terms shall have the
meanings specified below unless the context otherwise requires:
"Account Designation Letter" means the Notice of Account Designation
Letter dated the Closing Date from the Borrower to the Administrative Agent in
substantially the form attached hereto as Schedule 1.1-1.
"Additional Commitment" means, with respect to any Lender which
executes a New Commitment Agreement in accordance with Section 3.4(c), the
commitment of such Lender in an aggregate principal amount up to the amount
specified in such New Commitment Agreement to make Revolving Loans in accordance
with the provisions of Section 2.1.
"Administrative Agent" shall have the meaning assigned to such term in
the first paragraph hereof, together with any successors or assigns.
"Administrative Agent's Fees" shall have the meaning assigned to such
term in Section 3.5(c).
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"Affiliate" means as to any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control with,
such Person. For purposes of this definition, a Person shall be deemed to be
"controlled by" a Person if such Person possesses, directly or indirectly, power
either (a) to vote 20% or more of the securities having ordinary voting power
for the election of directors of such Person or (b) to direct or cause the
direction of the management and policies of such Person whether by contract or
otherwise.
"Aggregate Commitment" means, for any Utilization Period, the sum of
the Aggregate Revolving Committed Amount under this Credit Agreement and the
commitments under the 364-Day Facility Credit Agreement.
"Aggregate Revolving Committed Amount" means the aggregate amount of
Commitments in effect from time to time, being initially SEVENTY FIVE MILLION
DOLLARS ($75,000,000), and as such aggregate amount may be increased or reduced
from time to time as provided in Section 3.4.
"Alternate Base Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest whole multiple of 1/100 of 1%) equal to
the greater of (a) the Federal Funds Rate in effect on such day plus 1/2 of 1%
or (b) the Prime Rate in effect on such day. If for any reason the
Administrative Agent shall have reasonably determined (which determination shall
be conclusive absent manifest error) that it is unable after due inquiry to
ascertain the Federal Funds Rate for any reason, including the inability or
failure of the Administrative Agent to obtain sufficient quotations in
accordance with the terms hereof, the Alternate Base Rate shall be determined
without regard to clause (a) of the first sentence of this definition until the
circumstances giving rise to such inability no longer exist. Any change in the
Alternate Base Rate due to a change in the Prime Rate or the Federal Funds Rate
shall be effective on the effective date of such change in the Prime Rate or the
Federal Funds Rate, respectively.
"Alternate Base Rate Loans" means Loans that bear interest at an
interest rate based on the Alternate Base Rate.
"Applicable Percentage" means for any day, the rate per annum set forth
below opposite the applicable rating for the Borrower's senior unsecured
(non-credit enhanced) long term debt as determined by S&P and Moody's (the "Debt
Rating") then in effect, it being understood that the Applicable Percentage for
(i) Alternate Base Rate Loans shall be the percentage set forth under the column
"Alternate Base Rate Margin", (ii) LIBOR Rate Loans shall be the percentage set
forth under the column "LIBOR Margin", (iii) the Facility Fee shall be the
percentage set forth under the column "Facility Fee" and (iv) the Utilization
Fee shall be the percentage set forth under the column "Utilization Fee":
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Alternate
Pricing S&P Moody's LIBOR Base Rate Facility Utilization
Level Rating Rating Margin Margin Fee Fee
----- ------ ------ ------ ------ --- ---
I BBB+ or higher Baa1 or higher 0.475% 0% 0.150% 0.125%
II BBB Baa2 0.575% 0% 0.175% 0.125%
III BBB- Baa3 0.875% 0% 0.250% 0.125%
IV BB+ Ba1 1.005% 0% 0.375% 0.125%
V BB+ or lower Ba1 or lower 1.125% 0% 0.500% 0.125%
Any change in the Applicable Percentage due to a change in the Debt
Rating shall be effective on the date on which such change is announced publicly
by S&P and/or Moody's, as applicable, or otherwise becomes effective. The
Borrower shall be obligated to provide notice to the Administrative Agent and
the Lenders of any change in the Debt Rating in accordance with Section 6.3(d).
The initial Applicable Percentage shall be set at no lower than Pricing Level
III and shall not be adjusted to a higher Pricing Level (that is, Pricing Level
I or Pricing Level II) until the end of the first two complete fiscal quarters
following the Closing Date. Adjustment in the Applicable Percentage shall be
effective as to all Loans, existing and prospective, from the date of
adjustment. The Administrative Agent shall promptly notify the Lenders of
changes in the Applicable Percentage.
If (a) only one of S&P and Moody's at any time of determination shall
have in effect a Debt Rating, the Applicable Percentage shall be determined by
reference to the available rating, (b) neither S&P nor Moody's at any time of
determination shall have in effect a Debt Rating, the Applicable Percentage will
be set in accordance with Pricing Level V, (c) there shall be a one Pricing
Level difference between the ratings established by S&P and Moody's, the
Applicable Percentage shall be based upon the lower rating, (d) there shall be a
greater than one Pricing Level difference between the ratings established by S&P
and Moody's, the Applicable Percentage shall be based upon the Pricing Level
immediately above the lower rating and (e) S&P or Moody's shall change the basis
on which ratings are established, each reference to the Debt Rating announced by
S&P or Moody's, as the case may be, shall refer to the then equivalent rating by
S&P or Moody's, as the case may be.
"364-Day Credit Agreement" means that certain 364-Day Credit Agreement
dated as of the date hereof among the Borrower, the Guarantors identified
therein, the Lenders identified therein and First Union, as Administrative
Agent, as amended, modified, supplemented, extended or restated from time to
time.
"Arranger" means First Union Securities, Inc., d/b/a Wachovia
Securities, together with its successors and assigns.
"Attributed Principal Amount" means, on any day, with respect to any
Permitted Receivables Financing entered into by any Credit Party, the aggregate
amount (with respect to any such transaction, the "Invested Amount") paid to, or
borrowed by, such Person as of such date under such Permitted Receivables
Financing, minus the aggregate amount received by the applicable Receivables
Financier and applied to the reduction of the Invested Amount under such
Permitted Receivables Financing.
"Average Outstanding Loans" means, for any Utilization Period, the sum
of (i) the aggregate principal amount of Loans outstanding under this Credit
Agreement, plus (ii) the
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aggregate principal amount of loans outstanding under the Three Year Credit
Agreement, as of the end of each day during such Utilization Period, divided by
the number of days in such Utilization Period.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United
States Code, as amended, modified, succeeded or replaced from time to time.
"Borrower" means The Dial Corporation, a Delaware corporation, as
referenced in the opening paragraph, its successors and permitted assigns.
"Business Day" means any day other than a Saturday, Sunday or legal
holiday on which commercial banks are open for business in Xxxxxxxxx, Xxxxx
Xxxxxxxx xxx Xxx Xxxx, Xxx Xxxx; except that when used in connection with a
LIBOR Rate Loan, such day shall also be a day on which dealings between banks
are carried on in London, England in deposits of Dollars.
"Capital Lease" means, as applied to any Person, any lease of any
Property (whether real, personal or mixed) by that Person as lessee which, in
accordance with GAAP, is or should be accounted for as a capital lease on the
balance sheet of that Person.
"Capital Stock" means (i) in the case of a corporation, capital stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
capital stock, (iii) in the case of a partnership, partnership interests
(whether general or limited), (iv) in the case of a limited liability company,
membership interests and (v) any other interest or participation that confers on
a Person the right to receive a share of the profits and losses of, or
distribution of assets of, the issuing Person.
"Cash Equivalents" shall mean (i) securities issued or directly and
fully guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than twelve months from the date of acquisition ("Government Obligations"), (ii)
U.S. dollar denominated (or foreign currency fully hedged) time deposits,
certificates of deposit, Eurodollar time deposits and Eurodollar certificates of
deposit of (y) any domestic commercial bank of recognized standing having
capital and surplus in excess of $250,000,000 or (z) any bank whose short-term
commercial paper rating from S&P is at least A-1 or the equivalent thereof or
from Xxxxx'x is at least P-1 or the equivalent thereof (any such bank being an
"Approved Bank"), in each case with maturities of not more than 364 days from
the date of acquisition, (iii) commercial paper and variable or fixed rate notes
issued by any Approved Bank (or by the parent company thereof) or any variable
rate notes issued by, or guaranteed by any domestic corporation rated A-1 (or
the equivalent thereof) or better by S&P or P-1 (or the equivalent thereof) or
better by Moody's and maturing within six months of the date of acquisition,
(iv) repurchase agreements with a bank or trust company (including a Lender) or
a recognized securities dealer having capital and surplus in excess of
$500,000,000 for direct obligations issued by or fully guaranteed by the United
States of America, (v) obligations of any state of the United States or any
political subdivision thereof for the payment of the principal and redemption
price of and interest on which there shall have been irrevocably deposited
Government Obligations maturing as to principal and interest at times and in
amounts sufficient
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to provide such payment, and (vi) auction preferred stock rated in the highest
short-term credit rating category by S&P or Moody's.
"Change of Control" means (a) any Person or two or more Persons acting
in concert shall have acquired "beneficial ownership," directly or indirectly,
of, or shall have acquired by contract or otherwise, or shall have entered into
a contract or arrangement that, upon consummation, will result in its or their
acquisition of, or control over, Voting Stock of the Borrower (or other
securities convertible into such Voting Stock) representing 40% or more of the
combined voting power of all Voting Stock of the Borrower, or (b) Continuing
Directors shall cease for any reason to constitute a majority of the members of
the board of directors of the Borrower then in office. As used herein,
"beneficial ownership" shall have the meaning provided in Rule 13d-3 of the
Securities and Exchange Commission under the Securities Act of 1934.
"Closing Date" means the date hereof.
"Code" means the Internal Revenue Code of 1986, as amended, and any
successor statute thereto, as interpreted by the rules and regulations issued
thereunder, in each case as in effect from time to time. References to sections
of the Code shall be construed also to refer to any successor sections.
"Commitment" means, with respect to each Lender, the commitment of such
Lender to make Revolving Loans in an aggregate principal amount at any time
outstanding of up to such Lender's Revolving Committed Amount as specified in
Schedule 2.1(a), as such amount may be reduced from time to time in accordance
with the provisions hereof.
"Commitment Percentage" means, for each Lender, a fraction (expressed
as a decimal) the numerator of which is the Commitment of such Lender at such
time and the denominator of which is the Aggregate Revolving Committed Amount at
such time. The initial Commitment Percentages are set out on Schedule 2.1(a).
"Commitment Period" means the period from and including the Closing
Date to but not including the earlier of (i) the Maturity Date, or (ii) the date
on which the Commitments terminate in accordance with the provisions of this
Credit Agreement.
"Commonly Controlled Entity" means an entity, whether or not
incorporated, which is under common control with the Borrower within the meaning
of Section 4001 of ERISA or is part of a group which includes the Borrower and
which is treated as a single employer under Section 414 of the Code.
"Consolidated EBITDA" means, for the applicable period, the sum of (i)
Consolidated Net Income for such period, plus (ii) the interest expense for such
period (including, without limitation, the interest component of payments under
Capital Leases) deducted in determining Consolidated Net Income, plus (iii) the
income tax expense for such period deducted in determining Consolidated Net
Income, plus (iv) the aggregate amount of the depreciation expense and
amortization expense for such period to the extent deducted in determining
Consolidated Net Income, minus (v) any extraordinary, unusual or nonrecurring
items of gain (or
5
plus any extraordinary, unusual or nonrecurring items of loss) included in
Consolidated Net Income for such period, in each case determined for the
Borrower and its Subsidiaries on a consolidated basis; provided that to the
extent that one or more acquisitions or dispositions occurred during such
period, Consolidated EBITDA shall be calculated as if such acquisition or
disposition occurred on the first day of such period (on a pro forma basis for
the portion of such period prior to the date of such acquisition (or after the
date of such disposition) and on an actual basis for the portion of such period
after the date of such acquisition (or before the date of such disposition)).
"Consolidated Funded Debt" means Funded Debt of the Borrower and its
Subsidiaries on a consolidated basis.
"Consolidated Interest Expense" means, for the applicable period, all
interest expense (including the interest component under Capital Leases and the
implied interest component under Permitted Receivables Financings) of the
Borrower and its Subsidiaries for such period, as determined in accordance with
GAAP. Unless expressly indicated otherwise, the applicable period shall be for
the four consecutive quarters ending as of the date of computation.
"Consolidated Net Income" means, for the applicable period, net income
of the Borrower and its Subsidiaries on a consolidated basis. Unless expressly
indicated otherwise, the applicable period shall be for the four consecutive
quarters ending on the date of computation.
"Consolidated Net Worth" means, as of any date of computation, the sum
of (i) consolidated stockholders' equity of the Borrower and its Subsidiaries
(calculated without giving effect to (a) translation gains or losses relating to
foreign currency rates, (b) gains or losses relating to the sale of assets
attributable to, or other disposition of, the Borrower's Argentinean operations
and (c) gains or losses attributable to the sale of the Armour food business of
the Borrower) plus (ii) an amount not to exceed $45,000,000 resulting from the
impairment charge relating to the Borrower's Argentinean operations.
"Consolidated Total Tangible Assets" means, on the date of computation,
(i) consolidated total assets minus (ii) goodwill minus (iii) other items
properly classified as "intangible assets," in each case determined for the
Borrower and its Subsidiaries on a consolidated basis.
"Continuing Directors" means, during any period of up to 24 consecutive
months commencing after the Closing Date, individuals who at the beginning of
such 24 month period were directors of the Borrower (together with any new
director whose election by the Borrower's board of directors or whose nomination
for election by the Borrower's shareholders was approved by a vote of at least
two-thirds of the directors then still in office who either were directors at
the beginning of such period or whose election or nomination for election was
previously so approved).
"Credit Documents" means a collective reference to this Credit
Agreement, the 364-Day Credit Agreement, the Notes, any Joinder Agreement, the
Fee Letter and all other related agreements and documents issued or delivered
hereunder or thereunder or pursuant hereto or thereto.
6
"Credit Party" means any of the Borrower or the Guarantors.
"Credit Party Obligations" means, without duplication, (i) all of the
obligations of the Credit Parties to the Lenders and the Administrative Agent,
whenever arising, under this Credit Agreement, the Notes or any of the other
Credit Documents (including, but not limited to, any interest accruing after the
occurrence of a filing of a petition of bankruptcy under the Bankruptcy Code
with respect to any Credit Party, regardless of whether such interest is an
allowed claim under the Bankruptcy Code) and (ii) all liabilities and
obligations, whenever arising, owing from any Credit Party or any of its
Subsidiaries to any Lender, or any Affiliate of a Lender, arising under any
Hedging Agreement.
"Debt Rating" shall have the meaning assigned to such term in the
definition of "Applicable Percentage."
"Default" means any event, act or condition which with notice or lapse
of time, or both, would constitute an Event of Default.
"Defaulting Lender" means, at any time, any Lender that, at such time,
(i) has failed to make a Loan required pursuant to the terms of this Credit
Agreement, (ii) has failed to pay to the Administrative Agent or any Lender an
amount owed by such Lender pursuant to the terms of the Credit Agreement or any
other of the Credit Documents, or (iii) has been deemed insolvent or has become
subject to a bankruptcy or insolvency proceeding or to a receiver, trustee or
similar proceeding.
"Dollars" and "$" means dollars in lawful currency of the United States
of America.
"Domestic Subsidiary" means any Subsidiary that is organized and
existing under the laws of the United States or any state or commonwealth
thereof or under the laws of the District of Columbia.
"Environmental Laws" means any and all applicable foreign, federal,
state, local or municipal laws, rules, orders, regulations, statutes,
ordinances, codes, decrees, requirements or any Governmental Authority or other
Requirement of Law (including common law) regulating, relating to or imposing
liability or standards of conduct concerning protection of human health or the
environment, as now or may at any time be in effect during the term of this
Credit Agreement.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto, as interpreted by the rules and
regulations thereunder, all as the same may be in effect from time to time.
References to sections of ERISA shall be construed also to refer to any
successor sections.
"Eurodollar Reserve Percentage" means for any day, the percentage
(expressed as a decimal and rounded upwards, if necessary, to the next higher
1/100th of 1%) which is in effect for such day as prescribed by the Federal
Reserve Board (or any successor) for determining the
7
maximum reserve requirement (including without limitation any basic,
supplemental or emergency reserves) in respect of Eurocurrency liabilities, as
defined in Regulation D of such Board as in effect from time to time, or any
similar category of liabilities for a member bank of the Federal Reserve System
in New York City.
"Event of Default" means such term as defined in Section 8.1.
"Fee Letter" means that certain letter agreement, dated as of January
23, 2002, among First Union, the Arranger and the Borrower, as amended,
modified, supplemented or replaced from time to time.
"Fees" means all fees payable pursuant to Section 3.5.
"Federal Funds Rate" means, for any day, the rate of interest per annum
(rounded upwards, if necessary, to the nearest whole multiple of 1/100 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 Business Day next succeeding such day, provided that (A) if such day is
not a Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day and (B) if no such rate is
so published on such next preceding Business Day, the Federal Funds Rate for
such day shall be the average rate quoted to the Administrative Agent on such
day on such transactions as reasonably determined by the Administrative Agent.
"First Union" means First Union National Bank and its successors.
"Foreign Subsidiary" means any Subsidiary that is not a Domestic
Subsidiary.
"Funded Debt" means, with respect to any Person, without duplication,
(a) all obligations of such Person for borrowed money, (b) all obligations of
such Person evidenced by bonds, debentures, notes or similar instruments, or
upon which interest payments are customarily made, (c) all obligations of such
Person under conditional sale or other title retention agreements relating to
property purchased by such Person (other than customary reservations or
retentions of title under agreements with suppliers entered into in the ordinary
course of business), (d) all obligations of such Person incurred, issued or
assumed as the deferred purchase price of property or services purchased by such
Person (other than trade debt incurred in the ordinary course of business and
due within six months of the incurrence thereof) which would appear as
liabilities on a balance sheet of such Person, (e) the principal portion of all
obligations of such Person under Capital Leases, (f) all obligations of such
Person under Hedging Agreements, excluding any portion thereof which would be
accounted for as interest expense under GAAP or for which hedge accounting under
GAAP is applicable, (g) the maximum amount of all standby letters of credit
issued for the account of such Person and, without duplication, all drafts drawn
thereunder (to the extent unreimbursed), (h) all preferred Capital Stock issued
by such Person and which by the terms thereof could be (at the request of the
holders thereof or otherwise) subject to mandatory sinking fund payments,
redemption or other acceleration, (i) the principal balance outstanding under
any synthetic lease, tax retention operating lease, off-balance sheet loan or
similar off-balance sheet financing
8
product, including, without limitation, the outstanding Attributed Principal
Amount under any Permitted Receivables Financing, but excluding customary
operating leases in the ordinary course of business, (j) all Indebtedness of
others of the type described in clauses (a) through (i) hereof secured by (or
for which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on, or payable out of the proceeds of
production from, property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed, (k) all Guaranty Obligations of
such Person with respect to Indebtedness of another Person of the type described
in clauses (a) through (i) hereof, and (l) all Indebtedness of the type
described in clauses (a) through (i) hereof of any partnership or unincorporated
joint venture in which such Person is a general partner or a joint venturer;
provided, however, that Funded Debt shall not include Indebtedness among the
Credit Parties to the extent such Indebtedness would be eliminated on a
Consolidated basis.
"GAAP" means generally accepted accounting principles in the United
States applied on a consistent basis and subject to the terms of Section 1.3
hereof.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Guarantors" means (a) any of the Domestic Subsidiaries identified as a
"Guarantor" on the signature pages hereto and (b) any Person which executes a
Joinder Agreement, together with their successors and permitted assigns.
"Guaranty" means the guaranty of the Guarantors set forth in Section
11.
"Guaranty Obligations" means, with respect to any Person, without
duplication, any obligations of such Person (other than endorsements in the
ordinary course of business of negotiable instruments for deposit or collection)
guaranteeing or intended to guarantee any Indebtedness of any other Person in
any manner, whether direct or indirect, and including without limitation any
obligation, whether or not contingent, (i) to purchase any such Indebtedness or
any property constituting security therefor, (ii) to advance or provide funds or
other support for the payment or purchase of any such Indebtedness or to
maintain working capital, solvency or other balance sheet condition of such
other Person (including without limitation keep well agreements, maintenance
agreements, comfort letters or similar agreements or arrangements) for the
benefit of any holder of Indebtedness of such other Person, (iii) to lease or
purchase Property, securities or services primarily for the purpose of assuring
the holder of such Indebtedness, or (iv) to otherwise assure or hold harmless
the holder of such Indebtedness against loss in respect thereof. The amount of
any Guaranty Obligation hereunder shall (subject to any limitations set forth
therein) be deemed to be an amount equal to the outstanding principal amount (or
maximum principal amount, if larger) of the Indebtedness in respect of which
such Guaranty Obligation is made.
"Hedging Agreements" means, with respect to any Person, any agreement
entered into to protect such Person against fluctuations in interest rates, or
currency or raw materials values, including, without limitation, any interest
rate swap, cap or collar agreement or similar arrangement between such Person
and one or more counterparties, any foreign currency
9
exchange agreement, currency protection agreements, commodity purchase or option
agreements or other interest or exchange rate or commodity price hedging
agreements.
"Indebtedness" means, with respect to any Person, without duplication,
(a) all obligations of such Person for borrowed money, (b) all obligations of
such Person evidenced by bonds, debentures, notes or similar instruments, or
upon which interest payments are customarily made, (c) all obligations of such
Person under conditional sale or other title retention agreements relating to
property purchased by such Person (other than customary reservations or
retentions of title under agreements with suppliers entered into in the ordinary
course of business), (d) all obligations of such Person issued or assumed as the
deferred purchase price of property or services purchased by such Person (other
than trade debt incurred in the ordinary course of business and due within six
months of the incurrence thereof) which would appear as liabilities on a balance
sheet of such Person, (e) all obligations of such Person under take-or-pay or
similar arrangements or under commodities agreements, (f) all Indebtedness of
others secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on, or payable out of
the proceeds of production from, property owned or acquired by such Person,
whether or not the obligations secured thereby have been assumed, (g) all
Guaranty Obligations of such Person with respect to Indebtedness of another
Person, (h) the principal portion of all obligations of such Person under
Capital Leases plus any accrued interest thereon, (i) all obligations of such
Person under Hedging Agreements, excluding any portion thereof which would be
accounted for as interest expense under GAAP or for which hedge accounting under
GAAP is applicable, (j) the maximum amount of all standby letters of credit
issued for the account of such Person and, without duplication, all drafts drawn
thereunder (to the extent unreimbursed), (k) all preferred Capital Stock issued
by such Person and which by the terms thereof could be (at the request of the
holders thereof or otherwise) subject to mandatory sinking fund payments,
redemption or other acceleration, (l) the principal balance outstanding under
any synthetic lease, tax retention operating lease, off-balance sheet loan or
similar off-balance sheet financing product plus any accrued interest thereon,
but excluding customary operating leases in the ordinary course of business and
(m) the Indebtedness of any partnership or unincorporated joint venture in which
such Person is a general partner or a joint venturer.
"Insolvency" means, with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of such term as used in
Section 4245 of ERISA.
"Interest Coverage Ratio" means, for the applicable period, the ratio
of (i) Consolidated EBITDA for such period to (ii) Consolidated Interest Expense
paid or payable in cash during such period. Unless expressly indicated
otherwise, the applicable period shall be for the four consecutive quarters
ending on the date of computation.
"Interest Payment Date" means (a) as to any Alternate Base Rate Loan,
the last day of each March, June, September and December and on the Maturity
Date, (b) as to any LIBOR Rate Loan having an Interest Period of three months or
less, the last day of such Interest Period, and (c) as to any LIBOR Rate Loan
having an Interest Period longer than three months, each day which is three
months after the first day of such Interest Period and the last day of such
Interest Period.
10
"Interest Period" means, as to any LIBOR Rate Loan, a period of one,
two, three or six month's duration, as the Borrower may elect, commencing in
each case, on the date of the borrowing (including conversions, extensions and
renewals); provided, however, (A) if any Interest Period would end on a day
which is not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day (except that in the case of LIBOR Rate Loans where the
next succeeding Business Day falls in the next succeeding calendar month, then
on the next preceding Business Day), (B) no Interest Period shall extend beyond
the Maturity Date, and (C) in the case of LIBOR Rate Loans, where an Interest
Period begins on a day for which there is no numerically corresponding day in
the calendar month in which the Interest Period is to end, such Interest Period
shall end on the last Business Day of such calendar month.
"Invested Amount" shall have the meaning set forth in the definition of
Attributed Principal Amount.
"Investment" means all investments, in cash or by delivery of property
made, directly or indirectly in, to or from any Person, whether by acquisition
of shares of Capital Stock, property, assets, indebtedness or other obligations
or securities or by loan advance, capital contribution or otherwise.
"Joinder Agreement" means a Joinder Agreement in substantially the form
of Schedule 6.9, executed and delivered by each Person required to become a
Guarantor in accordance with the provisions of Section 6.9.
"Lenders" means each of the Persons identified as a "Lender" on the
signature pages hereto, and their successors and assigns.
"Leverage Ratio" means the ratio of Consolidated Funded Debt on the
date of computation to Consolidated EBITDA for the applicable period ending on
the date of computation. Unless expressly indicated otherwise, the applicable
period shall be for the four consecutive quarters ending on the date of
computation.
"LIBOR" means, for any LIBOR Rate Loan for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as the
London interbank offered rate for deposits in Dollars at approximately 11:00
a.m. (London time) two Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period. If for any reason such
rate is not available, the term "LIBOR" shall mean, for any LIBOR Rate Loan for
any Interest Period therefor, the rate per annum (rounded upwards, if necessary,
to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as the London
interbank offered rate for deposits in Dollars at approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such Interest Period
for a term comparable to such Interest Period; provided, however, if more than
one rate is specified on Reuters Screen LIBO Page, the applicable rate shall be
the arithmetic mean of all such rates (rounded upwards, if necessary, to the
nearest 1/100 of 1%). If, for any reason, neither of such rates is available,
then "LIBOR" shall mean the rate per annum at which, as determined by the
Administrative Agent, Dollars in an amount comparable to the Loans then
requested are being offered to leading banks at approximately 11:00 A.M. London
time, two (2) Business Days prior
11
to the commencement of the applicable Interest Period for settlement in
immediately available funds by leading banks in the London interbank market for
a period equal to the Interest Period selected.
"LIBOR Lending Office" means, initially, the office of each Lender
designated as such Lender's LIBOR Lending Office shown on Schedule 10.2; and
thereafter, such other office of such Lender as such Lender may from time to
time specify to the Administrative Agent and the Borrower as the office of such
Lender at which the LIBOR Rate Loans of such Lender are to be made.
"LIBOR Rate" means a rate per annum (rounded upwards, if necessary, to
the next higher 1/100th of 1%) determined by the Administrative Agent pursuant
to the following formula:
LIBOR Rate = LIBOR
------------------------------------
1.00 - Eurodollar Reserve Percentage
"LIBOR Rate Loan" means any Loan bearing interest at a rate determined
by reference to the LIBOR Rate.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, security interest, encumbrance, lien (statutory or otherwise),
preference, priority or charge of any kind (including any conditional sale or
other title retention agreement, any financing or similar statement or notice
filed under the Uniform Commercial Code as adopted and in effect in the relevant
jurisdiction or other similar recording or notice statute, and any lease in the
nature thereof).
"Loan" or "Loans" means any Revolving Loan. -
"Material Adverse Effect" means a material adverse effect on (a) the
business, assets or liabilities (financial or otherwise) of the Credit Parties
and their Subsidiaries taken as a whole, (b) the ability of the Borrower or any
Guarantor to perform its obligations, when such obligations are required to be
performed, under this Credit Agreement, any of the Notes or any other Credit
Document or (c) the validity or enforceability of this Credit Agreement, any of
the Notes or any of the other Credit Documents or the material rights or
remedies of the Administrative Agent or the Lenders hereunder or thereunder.
"Material Contract" means any contract or other arrangement, whether
written or oral, to which the Borrower or any of its Subsidiaries is a party as
to which contract the breach, nonperformance or cancellation of such contract by
any party thereto could reasonably be expected to have a Material Adverse
Effect.
"Material Domestic Subsidiary" means any Domestic Subsidiary which owns
operating assets as of the Closing Date or as of the end of the most recent
fiscal year thereafter in excess of five percent (5%) of the Consolidated Total
Tangible Assets. In making the foregoing determination, the percentage ownership
interest in a Subsidiary held by the Borrower or any of its Subsidiaries shall
be applied to the value of operating assets held by such Subsidiary and the
12
resulting value shall be used to determine the percentage of the Consolidated
Total Tangible Assets held by such Subsidiary.
"Materials of Environmental Concern" means any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials, or wastes, defined or regulated as
such in or under any Environmental Law, including, without limitation, asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.
"Maturity Date" means, as to each Lender, the third anniversary of the
Closing Date.
"Moody's" means Xxxxx'x Investors Service, Inc., or any successor or
assignee of the business of such company in the business of rating securities.
"Multiemployer Plan" means a Plan which is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan which the Borrower, any
Subsidiary of the Borrower or any ERISA Affiliate and at least one employer
other than the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate
are contributing sponsors.
"New Commitment Agreement" has the meaning assigned to such term in
Section 3.4(c).
"Non-Excluded Taxes" means such term as is defined in Section 3.13.
"Note" or "Notes" means any Revolving Note.
"Notice of Borrowing" means a written notice of borrowing in
substantially the form of Schedule 2.1(b)(i), as required by Section 2.1(b)(i).
"Notice of Extension/Conversion" means the written notice of extension
or conversion in substantially the form of Schedule 3.2, as required by Section
3.2.
"Participant" shall have the meaning set forth in Section 10.6(b).
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA.
"Permitted Acquisition" means any acquisition or any series of related
acquisitions by a Credit Party of the assets or a majority of the Voting Stock
of a Person that is incorporated, formed or organized in the United States, or
any division, line of business or other business unit of a Person that is
incorporated, formed or organized in the United States (such Person or such
division, line of business or other business unit of such Person referred to
herein as the "Target"), in each case that is a type of business (or assets used
in a type of business) permitted to be engaged in by the Credit Parties and
their Subsidiaries pursuant to Section 7.3 hereof, so long as (a) no Default or
Event of Default shall then exist or would exist after giving effect thereto,
(b) the Credit Parties certify to the Administrative Agent and the Required
Lenders that the Credit
13
Parties will be in compliance on a Pro Forma Basis with all of the terms and
provisions of the financial covenants set forth in Section 6.7, (c) the Target,
if such Person would be a Material Domestic Subsidiary, shall have executed a
Joinder Agreement in accordance with the terms of Section 6.9, (d) if total
consideration for such Acquisition is greater than $50,000,000, the Target has
earnings before interest, taxes, depreciation and amortization for the most
recent four fiscal quarters prior to the acquisition date for which financial
statements are available, together with adjustments agreed to by the Borrower
and the Administrative Agent, in an amount greater than $0 and (e) such
acquisition is not a "hostile" acquisition and has been approved by the Board of
Directors and/or shareholders of the applicable Credit Party and the Target.
"Permitted Investments" means:
(i) cash and Cash Equivalents;
(ii) receivables owing to the Borrower or any of its
Subsidiaries or any receivables and advances to suppliers, in each case
if created, acquired or made in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms;
(iii) Investments in and loans by any Credit Party to any
other Credit Party;
(iv) loans and advances to officers, directors and employees
in the ordinary course of business in an aggregate amount not to exceed
$5,000,000 at any time outstanding;
(v) Investments (including debt obligations) received in
connection with the bankruptcy or reorganization of suppliers and
customers and in settlement of delinquent obligations of, and other
disputes with, customers and suppliers arising in the ordinary course
of business;
(vi) Investments, acquisitions or transactions permitted under
Section 7.4(b);
(vii) Permitted Acquisitions;
(viii) Investments by any Credit Party in a Receivables
Financing SPC made in connection with a Permitted Receivables
Financing;
(ix) Investments existing as of the Closing Date and set forth
on Schedule 7.5 hereto (including, without limitation, the intercompany
loan to Dial Argentina, S.A. which may be converted into equity after
the Closing Date); and
(x) additional loan advances and/or Investments of a nature
not contemplated by the foregoing clauses hereof; provided that such
loans, advances and/or Investments made pursuant to this clause (x)
shall not exceed an aggregate amount of $25,000,000 at any time
outstanding.
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"Permitted Liens" means:
(i) Liens in favor of a Lender hereunder in connection with
Hedging Agreements permitted under Section 7.1(e), but only to the
extent such Liens (A) secure obligations under Hedging Agreements with
any Lender or any Affiliate of a Lender and (B) relate only to
collateral which equally and ratably secures the Loans and other Credit
Party Obligations in favor of the Lenders hereunder;
(ii) Liens securing purchase money Indebtedness and Capital
Lease Obligations to the extent permitted under Section 7.1(c);
provided, that (A) any such Lien attaches to such property concurrently
with or within 30 days after the acquisition thereof and (B) such Lien
attaches solely to the property so acquired in such transaction;
(iii) Liens for taxes, assessments, charges or other
governmental levies not yet due or as to which the period of grace (not
to exceed 60 days), if any, related thereto has not expired or which
are being contested in good faith by appropriate proceedings, provided
that adequate reserves with respect thereto are maintained on the books
of the Borrower or its Subsidiaries, as the case may be, in conformity
with GAAP;
(iv) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of
business which are not overdue for a period of more than 60 days or
which are being contested in good faith by appropriate proceedings;
(v) pledges or deposits in connection with workers'
compensation, unemployment insurance and other social security
legislation and deposits securing liability to insurance carriers under
insurance or self-insurance arrangements incurred in the ordinary
course of business;
(vi) deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases, statutory
obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of
business;
(vii) Liens existing on the Closing Date and set forth on
Schedule 1.1-2; provided that (a) no such Lien shall at any time be
extended to cover property or assets other than the property or assets
subject thereto on the Closing Date and (b) the principal amount of the
Indebtedness secured by such Liens shall not be extended, renewed,
refunded or refinanced;
(viii) easements, rights-of-way, restrictions (including
zoning restrictions), minor defects or irregularities in title and
other similar charges or encumbrances not, in any material respect,
impairing the use of the encumbered Property for its intended purposes;
(ix) any extension, renewal or replacement (or successive
extensions, renewals or replacements), in whole or in part, of any Lien
referred to in the foregoing clauses;
15
provided that such extension, renewal or replacement Lien shall be
limited to all or a part of the property which secured the Lien so
extended, renewed or replaced; and
(x) other Liens not described above, provided that such Liens
do not secure obligations in excess of $25,000,000 at any one time
outstanding.
"Permitted Receivables Financing" shall mean any one or more
receivables financings in which (a) any Credit Party (i) sells (as determined in
accordance with GAAP) any accounts receivable, notes receivable, rights to
future lease payments or residuals (collectively, together with certain property
relating thereto and the right to collections thereon, being the "Transferred
Assets") to any Person that is not a Subsidiary or Affiliate of the Borrower
(with respect to any such transaction, the "Receivables Financier"), (ii)
borrows from such Receivables Financier and secures such borrowings by a pledge
of such Transferred Assets and/or (iii) otherwise finances its acquisition of
such Transferred Assets and, in connection therewith, conveys an interest in
such Transferred Assets to the Receivables Financier or (b) any Credit Party
sells, conveys or otherwise contributes any Transferred Assets to a Receivables
Financing SPC, which Receivables Financing SPC then (i) sells (as determined in
accordance with GAAP) any such receivables (or an interest therein) to any
Receivables Financier, (ii) borrows from such Receivables Financier and secures
such borrowings by a pledge of such receivables or (iii) otherwise finances its
acquisition of such receivables and, in connection therewith, conveys an
interest in such receivables to the Receivables Financier, provided that (A) the
aggregate Attributed Principal Amount for all such receivables financings shall
not at any time exceed $100,000,000, (B) such receivables financing shall not
involve any recourse to any Credit Party for any reason other than (x)
repurchases of non-eligible receivables or (y) indemnifications for losses other
than credit losses related to the receivables sold in such financing and (C) the
terms of such transaction, including the discount at which receivables are sold,
the term of the commitment of the Receivables Financier thereunder and any
termination events, shall be consistent at all times with those prevailing in
the market for similar transactions involving a receivables originator/servicer
of similar credit quality and a receivables pool of similar characteristics.
"Person" means any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other enterprise
(whether or not incorporated) or any Governmental Authority.
"Plan" means, at any particular time, any employee benefit plan which
is covered by Title IV of ERISA and in respect of which the Borrower or a
Commonly Controlled Entity is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA.
"Prime Rate" means the rate of interest per annum publicly announced
from time to time by First Union as its prime rate in effect at its principal
office in Charlotte, North Carolina, with each change in the Prime Rate being
effective on the date such change is publicly announced as effective (it being
understood and agreed that the Prime Rate is a reference rate used by First
Union in determining interest rates on certain loans and is not intended to be
the lowest rate of interest charged on any extension of credit by First Union to
any debtor).
16
"Pro Forma Basis" shall mean, with respect to any Permitted
Acquisition, that such Permitted Acquisition shall be deemed to have occurred as
of the first day of the twelve-month period ending as of the most recent month
end preceding the date of such Permitted Acquisition.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Purchasing Lenders" shall have the meaning set forth in Section
10.6(c).
"Receivables Financier" shall have the meaning set forth in the
definition of Permitted Receivables Financing.
"Receivables Financing SPC" shall mean, in respect of any Permitted
Receivables Financing, any Subsidiary or Affiliate of the Borrower to which any
Credit Party sells, contributes or otherwise conveys any Transferred Assets in
connection with such Permitted Receivables Financing.
"Recovery Event" shall mean the receipt by the Borrower or any of its
Subsidiaries of any cash insurance proceeds or condemnation award payable by
reason of theft, loss, physical destruction or damage, taking or similar event
with respect to any of their respective property or assets.
"Register" shall have the meaning given such term in Section 10.6(d).
"Regulation T, U, or X" means Regulation T, U or X, respectively, of
the Board of Governors of the Federal Reserve System as from time to time in
effect and any successor to all or a portion thereof.
"Reorganization" means, with respect to any Multiemployer Plan, the
condition that such Plan is in reorganization within the meaning of such term as
used in Section 4241 of ERISA.
"Related Fund" means, with respect to any Lender, any fund or trust or
entity that invests in commercial bank loans in the ordinary course of business
and is advised or managed by (i) such Lender, (ii) an Affiliate of such Lender,
(iii) any other Lender or any Affiliate thereof or (iv) the same investment
advisor as any Person described in clauses (i) - (iii).
"Reportable Event" means any of the events set forth in Section 4043(c)
of ERISA, other than those events as to which the thirty-day notice period is
waived under PBGC Reg. Section4043.
"Required Lenders" means, at any time, Lenders having more than
fifty-one percent (51%) of the Commitments, or if the Commitments have been
terminated, Lenders having more than fifty-one percent (51%) of the aggregate
principal amount of Loans outstanding; provided that the Commitments of, and
outstanding principal amount of Loans owing to, a Defaulting Lender shall be
excluded for purposes hereof in making a determination of Required Lenders.
17
"Requirement of Law" means, as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its material property is subject.
"Responsible Officer" means, with respect to the Borrower, the Chief
Executive Officer, Chief Financial Officer, the Controller and the Treasurer.
"Restricted Payment" shall mean (a) any dividend or other distribution,
direct or indirect, on account of any shares of any class of Capital Stock of
the Borrower or any of its Subsidiaries, now or hereafter outstanding, (b) any
payment or prepayment of principal of, premium, if any, or interest on,
redemption, purchase, retirement, defeasance, sinking fund or similar payment
with respect to, any Subordinated Indebtedness or (c) the payment by the
Borrower or any of its Subsidiaries of any management or consulting fee to any
Person or of any salary, bonus or other form of compensation to any Person who
is directly or indirectly a significant partner, shareholder, owner or executive
officer of any such Person, to the extent such salary, bonus or other form of
compensation is not included in the corporate overhead of the Borrower or such
Subsidiary.
"Revolving Committed Amount" means, collectively, the aggregate amount
of all of the Commitments and, individually, the amount of each Lender's
Commitment as specified in Schedule 2.1(a).
"Revolving Loans" shall have the meaning assigned to such term in
Section 2.1(a).
"Revolving Note" or "Revolving Notes" means the promissory notes of the
Borrower in favor of each of the Lenders evidencing the Revolving Loans in
substantially the form attached as Schedule 2.1(e), individually or
collectively, as appropriate, as such promissory notes may be amended, modified,
supplemented, extended, renewed or replaced from time to time.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill,
Inc., or any successor or assignee of the business of such division in the
business of rating securities.
"Single Employer Plan" means any Plan which is not a Multiemployer
Plan.
"Specified Sales" means (a) the sale, transfer, lease or other
disposition of inventory and materials in the ordinary course of business and
(b) the sale, transfer or other disposition of Permitted Investments.
"Subordinated Indebtedness" shall mean any Indebtedness incurred by any
Credit Party that by its terms is specifically subordinated in right of payment
to the prior payment of the Credit Party Obligations.
"Subsidiary" means, as to any Person, a corporation, partnership,
limited liability company or other entity of which shares of stock or other
ownership interests having ordinary voting power to elect a majority of the
directors or other managers of such corporation,
18
partnership, limited liability company or other entity (irrespective of whether
or not at the time, any class or classes of such corporation shall have or might
have voting power by reason of the happening of any contingency) are at the time
owned by such Person directly or indirectly through Subsidiaries. Unless
otherwise identified, "Subsidiary" or "Subsidiaries" shall mean Subsidiaries of
the Borrower.
"Target" shall have the meaning set forth in the definition of
Permitted Acquisition.
"Taxes" shall have the meaning set forth in Section 3.13.
"Transfer Effective Date" shall have the meaning set forth in each
Commitment Transfer Supplement.
"Transferred Assets" shall have the meaning set forth in the definition
of Permitted Receivables Financing.
"Utilization" means, for any Utilization Period, the percentage
obtained by dividing the Average Outstanding Loans by the average of the daily
Aggregate Commitments.
"Utilization Fees" has the meaning specified in Section 3.5(b).
"Utilization Period" means each calendar quarter, except that the
initial Utilization Period shall commence on the Closing Date and end on March
31, 2002, and the final Utilization Period shall end on the Maturity Date.
"Utilized Commitment" means, for any day that the Utilization Fees are
required to be paid pursuant to Section 3.5(b), the amount equal to the
principal amount of Loans outstanding on such day.
"Voting Stock" means, with respect to any Person, Capital Stock issued
by such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.
1.2 Computation of Time Periods.
All time references in this Credit Agreement and the other Credit
Documents shall be to Charlotte, North Carolina time unless otherwise indicated.
For purposes of computation of periods of time hereunder, the word "from" means
"from and including" and the words "to" and "until" each mean "to but
excluding."
1.3 Accounting Terms.
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP
19
applied on a consistent basis. All calculations made for the purposes of
determining compliance with this Credit Agreement (including, without
limitation, calculation of the financial covenants set forth in Section 6.7)
shall (except as otherwise expressly provided herein) be made by application of
GAAP applied on a basis consistent with the most recent annual or quarterly
financial statements delivered pursuant to Section 6.1 hereof (or, prior to the
delivery of the first financial statements pursuant to Section 6.1 hereof,
consistent with the annual audited financial statements referenced in Section
5.1(a)(i) hereof); provided, however, if (a) the Borrower shall object to
determining such compliance on such basis at the time of delivery of such
financial statements due to any change in GAAP or the rules promulgated with
respect thereto or (b) the Administrative Agent or the Required Lenders shall so
object in writing within 30 days after delivery of such financial statements,
then such calculations shall be made on a basis consistent with the most recent
financial statements delivered by the Borrower to the Lenders as to which no
such objection shall have been made.
SECTION 2
CREDIT FACILITY
2.1 Revolving Loans.
(a) Commitment. During the Commitment Period, subject to the terms and
conditions hereof, each Lender severally agrees to make revolving credit loans
in Dollars (the "Revolving Loans") to the Borrower from time to time in the
amount of such Lender's Commitment Percentage of such Revolving Loans for the
purposes hereinafter set forth; provided that (i) with regard to the Lenders
collectively, the aggregate principal amount of Loans outstanding at any time
shall not exceed the Aggregate Revolving Committed Amount, and (ii) with regard
to each Lender individually, the aggregate principal amount of such Lender's
Commitment Percentage of Revolving Loans outstanding at any time shall not
exceed such Lender's Revolving Committed Amount. Revolving Loans may consist of
Alternate Base Rate Loans or LIBOR Rate Loans, or a combination thereof, as the
Borrower may request, and may be repaid and reborrowed in accordance with the
provisions hereof.
(b) Revolving Loan Borrowings. -
(i) Notice of Borrowing. The Borrower shall request a
Revolving Loan borrowing by written notice (or telephone notice
promptly confirmed in writing) to the Administrative Agent not later
than 11:00 A.M. on the day of the requested borrowing, which shall be a
Business Day, in the case of Alternate Base Rate Loans, and on the
third Business Day prior to the date of the requested borrowing in the
case of LIBOR Rate Loans. Each such request for borrowing shall be
irrevocable and shall specify (A) that a Revolving Loan is requested,
(B) the date of the requested borrowing (which shall be a Business
Day), (C) the aggregate principal amount to be borrowed, and (D)
whether the borrowing shall be comprised of Alternate Base Rate Loans,
LIBOR Rate Loans or a combination thereof, and if LIBOR Rate Loans are
requested, the Interest Period(s) therefor. If the Borrower shall fail
to specify in any such Notice of Borrowing (I) an applicable Interest
Period in the case of a LIBOR Rate Loan, then such notice shall be
deemed to be a request for an Interest Period of one month, or (II) the
type of Revolving
20
Loan requested, then such notice shall be deemed to be a request for a
Alternate Base Rate Loan hereunder. The Administrative Agent shall give
notice to each Lender promptly upon receipt of each Notice of Borrowing
pursuant to this Section 2.1(b)(i), the contents thereof and each such
Lender's share of any borrowing to be made pursuant thereto.
(ii) Minimum Amounts. Each Revolving Loan shall be in a
minimum aggregate principal amount of (A) in the case of LIBOR Rate
Loans, $5,000,000 and integral multiples of $1,000,000 in excess
thereof (or the remaining amount of the Revolving Committed Amount, if
less) or (B) in the case of Alternate Base Rate Loans, $1,000,000 and
integral multiples of $1,000,000 in excess thereof (or the remaining
amount of the Revolving Committed Amount, if less).
(iii) Advances. Each Lender will make its Commitment
Percentage of each Revolving Loan borrowing available to the
Administrative Agent for the account of the Borrower at the office of
the Administrative Agent specified in Section 10.2, or at such office
as the Administrative Agent may designate in writing, by 1:00 p.m. on
the date specified in the applicable Notice of Borrowing in Dollars and
in funds immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrower by the
Administrative Agent by crediting the account designated by the
Borrower with the aggregate of the amounts made available to the
Administrative Agent by the Lenders and in like funds as received by
the Administrative Agent.
(c) Repayment. The principal amount of all Loans shall be due and
payable in full on the Maturity Date.
(d) Interest. Subject to the provisions of Section 3.1:
(i) Alternate Base Rate Loans. During such periods as
Revolving Loans shall be comprised in whole or in part of Alternate
Base Rate Loans, such Alternate Base Rate Loans shall bear interest at
a per annum rate equal to the Alternate Base Rate plus the Applicable
Percentage;
(ii) LIBOR Rate Loans. During such periods as Revolving Loans
shall be comprised in whole or in part of LIBOR Rate Loans, such LIBOR
Rate Loans shall bear interest at a per annum rate equal to the LIBOR
Rate plus the Applicable Percentage.
Interest on Revolving Loans shall be payable in arrears on each applicable
Interest Payment Date (or at such other times as may be specified herein).
(e) Revolving Notes. The Revolving Loans shall be evidenced by a duly
executed Revolving Note in favor of each Lender in the form of Schedule 2.1(e)
attached hereto.
(f) Maximum Number of LIBOR Rate Loans. The Borrower will be limited to
a maximum number of eight (8) LIBOR Rate Loans outstanding at any time. For
purposes hereof,
21
LIBOR Rate Loans with separate or different Interest Periods will be considered
as separate LIBOR Rate Loans even if their Interest Periods expire on the same
date.
SECTION 3
OTHER PROVISIONS RELATING TO CREDIT FACILITIES
3.1 Default Rate.
Upon the occurrence, and during the continuance, of an Event of
Default, the principal of and, to the extent permitted by law, interest on the
Loans and any other amounts owing hereunder or under the other Credit Documents
shall bear interest, payable on demand, at a per annum rate 2% greater than the
interest rate which would otherwise be applicable (or if no rate is applicable,
whether in respect of interest, fees or other amounts, then 2% greater than the
Alternate Base Rate plus the Applicable Percentage).
3.2 Extension and Conversion.
The Borrower shall have the option, on any Business Day, to extend
existing Loans into a subsequent permissible Interest Period or to convert Loans
into Loans of another interest rate type; provided, however, that (i) except as
expressly provided otherwise in this Credit Agreement, LIBOR Rate Loans may be
converted into Alternate Base Rate Loans only on the last day of the Interest
Period applicable thereto, (ii) LIBOR Rate Loans may be extended, and Alternate
Base Rate Loans may be converted into LIBOR Rate Loans, only if the conditions
in Section 4.2 have been satisfied, (iii) Loans extended as, or converted into,
LIBOR Rate Loans shall be subject to the terms of the definition of "Interest
Period" set forth in Section 1.1 and shall be in such minimum amounts as
provided in Section 2.1(b)(ii), and (iv) any request for extension or conversion
of a LIBOR Rate Loan which shall fail to specify an Interest Period shall be
deemed to be a request for an Interest Period of one month. Each such extension
or conversion shall be effected by the Borrower by giving a Notice of
Extension/Conversion (or telephone notice promptly confirmed in writing) to the
Administrative Agent prior to 11:00 A.M. on the Business Day of, in the case of
the conversion of a LIBOR Rate Loan into a Alternate Base Rate Loan, and on the
third Business Day prior to, in the case of the extension of a LIBOR Rate Loan
as, or conversion of a Alternate Base Rate Loan into, a LIBOR Rate Loan, the
date of the proposed extension or conversion, specifying (A) the date of the
proposed extension or conversion, (B) the Loans to be so extended or converted,
(C) the types of Loans into which such Loans are to be converted and, if
appropriate, (D) the applicable Interest Periods with respect thereto. Each
request for extension or conversion shall be irrevocable and shall constitute a
representation and warranty by the Borrower of the matters specified in Section
4.2. In the event the Borrower fails to request extension or conversion of any
LIBOR Rate Loan in accordance with this Section, or any such conversion or
extension is not permitted or required by this Section, then such LIBOR Rate
Loan shall be continued as a LIBOR Rate Loan at the end of the Interest Period
applicable thereto for an Interest Period of one month. The Administrative Agent
shall give each Lender notice as promptly as practicable of any such proposed
extension or conversion affecting any Loan.
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3.3 Prepayments.
(a) Voluntary Prepayments. Revolving Loans may be repaid in whole or in
part without premium or penalty; provided that (i) LIBOR Rate Loans may be
prepaid only upon three (3) Business Days' prior written notice to the
Administrative Agent, and Alternate Base Rate Loans may be prepaid only upon at
least one (1) Business Day's prior written notice to the Administrative Agent,
(ii) prepayments of LIBOR Rate Loans must be accompanied by payment of any
amounts owing under Section 3.12, and (iii) partial prepayments shall be in
minimum principal amount of $10,000,000, and in integral multiples of $1,000,000
in excess thereof.
(b) Mandatory Prepayments. If at any time, the aggregate principal
amount of Loans shall exceed the Aggregate Revolving Committed Amount, the
Borrower shall immediately make payment on the Loans in an amount sufficient to
eliminate the deficiency.
(c) Application. Unless otherwise specified by the Borrower,
prepayments made hereunder shall be applied first to Alternate Base Rate Loans
and then to LIBOR Rate Loans in direct order of Interest Period maturities.
Amounts prepaid hereunder may be reborrowed in accordance with the provisions
hereof.
3.4 Termination, Reduction and Increase of Commitments
(a) Voluntary Reductions. The Commitments may be terminated or
permanently reduced by the Borrower in whole or in part upon three (3) Business
Days' prior written notice to the Administrative Agent; provided that (i) after
giving effect to any voluntary reduction, the aggregate principal amount of
Loans shall not exceed the Aggregate Revolving Committed Amount, as reduced, and
(ii) partial reductions shall be in minimum principal amounts of $10,000,000,
and in integral multiples of $1,000,000 in excess thereof.
(b) Mandatory Reduction. The Commitments hereunder shall terminate on
the Maturity Date.
(c) Increase in Commitments. The Borrower shall have the right upon at
least fifteen (15) Business Days' prior written notice to the Administrative
Agent to increase the Aggregate Revolving Committed Amount by up to $25,000,000,
in a single increase, at any time on or after the Closing Date, subject,
however, in any such case, to satisfaction of the following conditions
precedent:
(i) no Default or Event of Default shall have occurred and be
continuing on the date on which such Aggregate Revolving Committed
Amount increase is to become effective;
(ii) the representations and warranties set forth in Section 5
of this Credit Agreement shall be true and correct in all material
respects on and as of the date on which such Aggregate Revolving
Committed Amount increase is to become effective (except to the extent
they expressly relate to an earlier date);
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(iii) on or before the date on which such Aggregate Revolving
Committed Amount increase is to become effective, the Administrative
Agent shall have received, for its own account, the mutually acceptable
fees and expenses required by separate agreement of the Borrower and
the Administrative Agent to be paid in connection with such increase;
(iv) such Aggregate Revolving Committed Amount increase shall
be an integral multiple of $5,000,000 and shall in no event be less
than $5,000,000; and
(v) such requested Aggregate Revolving Commitment increase
shall be effective on such date only to the extent that, on or before
such date, (A) the Administrative Agent shall have received and
accepted a corresponding amount of Additional Commitment(s) pursuant to
a commitment letter(s) acceptable to the Administrative Agent from one
or more Lenders acceptable to the Administrative Agent and, with
respect to any Lender that is not at such time a Lender hereunder, to
the Borrower and (B) each such Lender has executed an agreement in the
form of Schedule 3.4(c) hereto (each such agreement a "New Commitment
Agreement"), accepted in writing therein by the Administrative Agent
and, with respect to any Lender that is not at such time a Lender
hereunder, by the Borrower, with respect to the Additional Commitment
of such Lender.
3.5 Fees.
(a) Facility Fee. In consideration of the Commitments hereunder, the
Borrower agrees to pay to the Administrative Agent for the ratable benefit of
the Lenders a facility fee (the "Facility Fee") equal to the Applicable
Percentage per annum, prior to the Maturity Date, on the average daily Aggregate
Revolving Committed Amount in effect from time to time, and after the Maturity
Date, on the average daily aggregate Revolving Loans outstanding. The Facility
Fee shall be payable quarterly in arrears on the 15th day following the last day
of each calendar quarter for the immediately preceding quarter (or portion
thereof) beginning with the first such date to occur after the Closing Date and
on the Maturity Date.
(b) Utilization Fee. For each day that the principal amount of
outstanding Loans hereunder is equal to or shall exceed an amount equal to fifty
percent (50%) of the then Aggregate Revolving Committed Amount, the Borrower
shall pay to the Administrative Agent for the pro rata benefit of the Lenders, a
per annum fee equal to one-eighth of one percent (.125%) on the Utilized
Commitment for such day (the "Utilization Fees"). The Utilization Fees, if any,
shall be due and payable in arrears on the first Business Day after the end of
each fiscal quarter of the Borrower (as well as on the Maturity Date and on any
date that the Commitment is reduced) for the immediately preceding fiscal
quarter (or portion thereof), beginning with the first of such dates to occur
after the Closing Date.
(c) Administrative Agent's Fees. The Borrower agrees to pay to the
Administrative Agent, for its own account, an annual administrative fee and such
other fees, if any, referred to in the Fee Letter (collectively, the
"Administrative Agent's Fees").
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3.6 Computation of Interest and Fees.
(a) Interest payable hereunder with respect to Alternate Base Rate
Loans based on the Prime Rate shall be calculated on the basis of a year of 365
days (or 366 days, as applicable) for the actual days elapsed. All other fees,
interest and all other amounts payable hereunder shall be calculated on the
basis of a 360 day year for the actual days elapsed. The Administrative Agent
shall as soon as practicable notify the Borrower and the Lenders of each
determination of a LIBOR Rate on the Business Day of the determination thereof.
Any change in the interest rate on a Loan resulting from a change in the
Alternate Base Rate shall become effective as of the opening of business on the
day on which such change in the Alternate Base Rate shall become effective. The
Administrative Agent shall as soon as practicable notify the Borrower and the
Lenders of the effective date and the amount of each such change.
(b) Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Credit Agreement shall be conclusive and
binding on the Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrower, deliver to the
Borrower a statement showing the computations used by the Administrative Agent
in determining any interest rate.
3.7 Pro Rata Treatment and Payments.
(a) Each borrowing of Revolving Loans and any reduction of the
Commitments shall be made pro rata according to the respective Commitment
Percentages of the Lenders. Each payment under this Credit Agreement or any Note
shall be applied (i) first, to any Fees then due and owing, (ii) second, to
interest then due and owing in respect of the Notes of the Borrower and (iii)
third, to principal then due and owing hereunder and under the Notes of the
Borrower. Each payment on account of any Fees pursuant to Sections 3.5(a) and
(b) shall be made pro rata in accordance with the respective amounts due and
owing. Each payment (other than prepayments) by the Borrower on account of
principal of and interest on the Revolving Loans shall be made pro rata
according to the respective amounts due and owing hereunder. Prepayments made
pursuant to Section 3.3 shall be applied in accordance with such section. Each
optional prepayment on account of principal of the Loans shall be applied in
accordance with Section 3.3 and each mandatory prepayment on account of
principal of the Loans shall be applied in accordance with Section 3.3. All
payments (including prepayments) to be made by the Borrower on account of
principal, interest and fees shall be made without defense, set-off or
counterclaim (except as provided in Section 3.13(b)) and shall be made to the
Administrative Agent for the account of the Lenders at the Administrative
Agent's office specified in Section 10.2 in Dollars and in immediately available
funds not later than 1:00 P.M. on the date when due. The Administrative Agent
shall distribute such payments to the Lenders entitled thereto promptly upon
receipt in like funds as received. If any payment hereunder (other than payments
on the LIBOR Rate Loans) becomes due and payable on a day other than a Business
Day, such payment shall be extended to the next succeeding Business Day, and,
with respect to payments of principal, interest thereon shall be payable at the
then applicable rate during such
25
extension. If any payment on a LIBOR Rate Loan becomes due and payable on a day
other than a Business Day, the maturity thereof shall be extended to the next
succeeding Business Day unless the result of such extension would be to extend
such payment into another calendar month, in which event such payment shall be
made on the immediately preceding Business Day.
(b) Allocation of Payments After Event of Default. Notwithstanding any
other provision of this Credit Agreement to the contrary, after the occurrence
and during the continuance of an Event of Default, all amounts collected or
received by the Administrative Agent or any Lender on account of the Credit
Party Obligations or any other amounts outstanding under any of the Credit
Documents shall be paid over or delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation reasonable attorneys' fees)
of the Administrative Agent in connection with enforcing the rights of
the Lenders under the Credit Documents;
SECOND, to payment of any fees owed to the Administrative
Agent;
THIRD, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation, reasonable attorneys' fees)
of each of the Lenders in connection with enforcing its rights under
the Credit Documents or otherwise with respect to the Credit Party
Obligations owing to such Lender;
FOURTH, to the payment of all of the Credit Party Obligations
consisting of accrued fees and interest (including, without limitation,
accrued fees and interest arising under any Hedging Agreement between
any Credit Party and any Lender, or any Affiliate of a Lender);
FIFTH, to the payment of the outstanding principal amount of
the Credit Party Obligations (including, without limitation, the
outstanding principal amount arising under any Hedging Agreement
between any Credit Party and any Lender, or any Affiliate of a Lender,
to the extent such Hedging Agreement is permitted by Section 7.1(e));
SIXTH, to all other Credit Party Obligations and other
obligations which shall have become due and payable under the Credit
Documents or otherwise and not repaid pursuant to clauses "FIRST"
through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whoever may
be lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be applied in
the numerical order provided until exhausted prior to application to
the next succeeding category and (ii) each of the Lenders shall receive
an amount equal to
26
its pro rata share (based on the proportion that the then outstanding
Loans held by such Lender bears to the aggregate then outstanding
Loans) of amounts available to be applied pursuant to clauses "THIRD",
"FOURTH", "FIFTH" and "SIXTH" above.
3.8 Non-Receipt of Funds by the Administrative Agent.
(a) Unless the Administrative Agent shall have been notified in writing
by a Lender prior to the date a Loan is to be made by such Lender (which notice
shall be effective upon receipt) that such Lender does not intend to make the
proceeds of such Loan available to the Administrative Agent, the Administrative
Agent may assume that such Lender has made such proceeds available to the
Administrative Agent on such date, and the Administrative Agent may in reliance
upon such assumption (but shall not be required to) make available to the
Borrower a corresponding amount. If such corresponding amount is not in fact
made available to the Administrative Agent, the Administrative Agent shall be
able to recover such corresponding amount from such Lender. If such Lender does
not pay such corresponding amount forthwith upon the Administrative Agent's
demand therefor, the Administrative Agent will promptly notify the Borrower, and
the Borrower shall immediately pay such corresponding amount to the
Administrative Agent. The Administrative Agent shall also be entitled to recover
from the Lender or the Borrower, as the case may be, interest on such
corresponding amount in respect of each day from the date such corresponding
amount was made available by the Administrative Agent to the Borrower to the
date such corresponding amount is recovered by the Administrative Agent at a per
annum rate equal to (i) from the Borrower at the applicable rate for the
applicable borrowing pursuant to the Notice of Borrowing and (ii) from a Lender
at the Federal Funds Rate.
(b) Unless the Administrative Agent shall have been notified in writing
by the Borrower, prior to the date on which any payment is due from it hereunder
(which notice shall be effective upon receipt) that the Borrower does not intend
to make such payment, the Administrative Agent may assume that such Borrower has
made such payment when due, and the Administrative Agent may in reliance upon
such assumption (but shall not be required to) make available to each Lender on
such payment date an amount equal to the portion of such assumed payment to
which such Lender is entitled hereunder, and if the Borrower has not in fact
made such payment to the Administrative Agent, such Lender shall, on demand,
repay to the Administrative Agent the amount made available to such Lender. If
such amount is repaid to the Administrative Agent on a date after the date such
amount was made available to such Lender, such Lender shall pay to the
Administrative Agent on demand interest on such amount in respect of each day
from the date such amount was made available by the Administrative Agent to such
Lender to the date such amount is recovered by the Administrative Agent at a per
annum rate equal to the Federal Funds Rate.
(c) A certificate of the Administrative Agent submitted to the Borrower
or any Lender with respect to any amount owing under this Section 3.8 shall be
conclusive in the absence of manifest error.
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3.9 Inability to Determine Interest Rate.
Notwithstanding any other provision of this Credit Agreement, if (i)
the Administrative Agent shall reasonably determine (which determination shall
be conclusive and binding absent manifest error) that, by reason of
circumstances affecting the relevant market, reasonable and adequate means do
not exist for ascertaining LIBOR for such Interest Period, or (ii) the Required
Lenders shall reasonably determine (which determination shall be conclusive and
binding absent manifest error) that the LIBOR Rate does not adequately and
fairly reflect the cost to such Lenders of funding LIBOR Rate Loans that the
Borrower has requested be outstanding as a LIBOR tranche during such Interest
Period, the Administrative Agent shall forthwith give telephone notice of such
determination, confirmed in writing, to the Borrower, and the Lenders at least
two Business Days prior to the first day of such Interest Period. Unless the
Borrower shall have notified the Administrative Agent upon receipt of such
telephone notice that it wishes to rescind or modify its request regarding such
LIBOR Rate Loans, any Loans that were requested to be made as LIBOR Rate Loans
shall be made as Alternate Base Rate Loans and any Loans that were requested to
be converted into or continued as LIBOR Rate Loans shall remain as or be
converted into Alternate Base Rate Loans. Until any such notice has been
withdrawn by the Administrative Agent, no further Loans shall be made as,
continued as, or converted into, LIBOR Rate Loans for the Interest Periods so
affected.
3.10 Illegality.
Notwithstanding any other provision of this Credit Agreement, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof by the relevant Governmental Authority to any Lender shall
make it unlawful for such Lender or its LIBOR Lending Office to make or maintain
LIBOR Rate Loans as contemplated by this Credit Agreement or to obtain in the
interbank eurodollar market through its LIBOR Lending Office the funds with
which to make such Loans, (a) such Lender shall promptly notify the
Administrative Agent and the Borrower thereof, (b) the commitment of such Lender
hereunder to make LIBOR Rate Loans or continue LIBOR Rate Loans as such shall
forthwith be suspended until the Administrative Agent shall give notice that the
condition or situation which gave rise to the suspension shall no longer exist,
and (c) such Lender's Loans then outstanding as LIBOR Rate Loans, if any, shall
be converted on the last day of the Interest Period for such Loans or within
such earlier period as required by law to Alternate Base Rate Loans. The
Borrower hereby agrees promptly to pay any Lender, upon its demand, any
additional amounts necessary to compensate such Lender for actual and direct
costs (but not including anticipated profits) reasonably incurred by such Lender
including, but not limited to, any interest or fees payable by such Lender to
lenders of funds obtained by it in order to make or maintain its LIBOR Rate
Loans hereunder. A certificate as to any additional amounts payable pursuant to
this Section submitted by such Lender, through the Administrative Agent, to the
Borrower shall be conclusive in the absence of manifest error. Each Lender
agrees to use reasonable efforts (including reasonable efforts to change its
LIBOR Lending Office) to avoid or to minimize any amounts which may otherwise be
payable pursuant to this Section; provided, however, that such efforts shall not
cause the imposition on such Lender of any additional costs or legal or
regulatory burdens deemed by such Lender in its reasonable discretion to be
material.
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3.11 Requirements of Law.
(a) If the adoption of or any change in any Requirement of Law
or in the interpretation or application thereof or compliance by any
Lender with any request or directive (whether or not having the force
of law) from any central bank or other Governmental Authority made
subsequent to the date hereof:
(i) shall subject such Lender to any tax of any kind
whatsoever with respect to any LIBOR Rate Loan made by it, or
change the basis of taxation of payments to such Lender in
respect thereof (except for changes in the rate of tax on the
overall net income of such Lender);
(ii) shall impose, modify or hold applicable any
reserve, special deposit, compulsory loan or similar
requirement against assets held by, deposits or other
liabilities in or for the account of, advances, loans or other
extensions of credit by, or any other acquisition of funds by,
any office of such Lender which is not otherwise included in
the determination of the LIBOR Rate hereunder; or
(iii) shall impose on such Lender any other
condition;
and the result of any of the foregoing is to increase the cost
to such Lender of making or maintaining LIBOR Rate Loans or to reduce
any amount receivable hereunder or under any Note, then, in any such
case, the Borrower shall promptly pay such Lender, upon its demand, any
additional amounts necessary to compensate such Lender for such
additional cost or reduced amount receivable which such Lender
reasonably deems to be material as determined by such Lender with
respect to its LIBOR Rate Loans. A certificate as to any additional
amounts payable pursuant to this Section submitted by such Lender,
through the Administrative Agent, to the Borrower shall be conclusive
in the absence of manifest error. Each Lender agrees to use reasonable
efforts (including reasonable efforts to change its LIBOR Lending
Office, as the case may be) to avoid or to minimize any amounts which
might otherwise be payable pursuant to this paragraph of this Section;
provided, however, that such efforts shall not cause the imposition on
such Lender of any additional costs or legal or regulatory burdens
deemed by such Lender in its reasonable discretion to be material.
(b) If (i) any Lender shall have reasonably determined that
the adoption of or any change in any Requirement of Law regarding
capital adequacy or in the interpretation or application thereof or
compliance by such Lender or any corporation controlling such Lender
with any request or directive regarding capital adequacy (whether or
not having the force of law) from any central bank or Governmental
Authority made subsequent to the date hereof does or shall have the
effect of reducing the rate of return on such Lender's or such
corporation's capital as a consequence of its obligations hereunder to
a level below that which such Lender or such corporation could have
achieved but for such adoption, change or compliance (taking into
consideration such Lender's or such corporation's policies with respect
to capital adequacy) by an
29
amount reasonably deemed by such Lender in its sole discretion to be
material and (ii) such Lender shall provide the Borrower, within thirty
(30) days following its determination that such a reduction in its rate
of return has occurred, with a certificate demanding such additional
amount (the "Shortfall Amount") as shall be certified by such Lender as
being required to compensate it for such reduction, within fifteen (15)
days after demand by such Lender, the Borrower shall pay to such Lender
the Shortfall Amount. Such a certificate as to any additional amounts
payable under this Section submitted by a Lender (which certificate
shall include a description of the basis for the computation), through
the Administrative Agent, to the Borrower shall be conclusive absent
manifest error.
(c) The agreements in this Section 3.11 shall survive the
termination of this Credit Agreement and payment of the Notes and all
other amounts payable hereunder.
3.12 Indemnity.
The Borrower hereby agrees to indemnify each Lender and to hold such
Lender harmless from any funding loss or expense which such Lender may sustain
or incur as a consequence of (a) default by the Borrower in payment of the
principal amount of or interest on any Loan by such Lender in accordance with
the terms hereof, (b) default by the Borrower in accepting a borrowing after the
Borrower has given a notice in accordance with the terms hereof, (c) default by
the Borrower in making any prepayment after the Borrower has given a notice in
accordance with the terms hereof, and/or (d) the making by the Borrower of a
prepayment of a Loan, or the conversion thereof, on a day which is not the last
day of the Interest Period with respect thereto, in each case including, but not
limited to, any such loss or expense arising from interest or fees payable by
such Lender to lenders of funds obtained by it in order to maintain its Loans
hereunder. A certificate as to any additional amounts payable pursuant to this
Section submitted by any Lender, through the Administrative Agent, to the
Borrower (which certificate must be delivered to the Administrative Agent within
thirty days following such default, prepayment or conversion) shall be
conclusive in the absence of manifest error. The agreements in this Section
shall survive termination of this Credit Agreement and payment of the Notes and
all other amounts payable hereunder.
3.13 Taxes.
(a) All payments made by the Borrower hereunder or under any
Note will be, except as provided in Section 3.13(b), made free and
clear of, and without deduction or withholding for, any present or
future taxes, levies, imposts, duties, fees, assessments or other
charges of whatever nature now or hereafter imposed by any Governmental
Authority or by any political subdivision or taxing authority thereof
or therein with respect to such payments (but excluding any tax imposed
on or measured by the net income or profits of a Lender pursuant to the
laws of the jurisdiction in which it is organized or the jurisdiction
in which the principal office or applicable lending office of such
Lender is located or any subdivision thereof or therein) and all
interest, penalties or similar liabilities with respect thereto (all
such non-excluded taxes, levies, imposts, duties, fees, assessments or
other charges being referred to collectively as "Taxes"). If
30
any Taxes are so levied or imposed, the Borrower agrees to pay the full
amount of such Taxes, and such additional amounts as may be necessary
so that every payment of all amounts due under this Credit Agreement or
under any Note, after withholding or deduction for or on account of any
Taxes, will not be less than the amount provided for herein or in such
Note. The Borrower will furnish to the Administrative Agent as soon as
practicable after the date the payment of any Taxes is due pursuant to
applicable law certified copies (to the extent reasonably available and
required by law) of tax receipts evidencing such payment by the
Borrower. The Borrower agrees to indemnify and hold harmless each
Lender, and reimburse such Lender upon its written request, for the
amount of any Taxes so levied or imposed and paid by such Lender.
(b) Each Lender that is not a United States person (as such
term is defined in Section 7701(a)(30) of the Code) agrees to deliver
to the Borrower and the Administrative Agent on or prior to the Closing
Date, or in the case of a Lender that is an assignee or transferee of
an interest under this Credit Agreement pursuant to Section 10.6
(unless the respective Lender was already a Lender hereunder
immediately prior to such assignment or transfer), on the date of such
assignment or transfer to such Lender, (i) if the Lender is a "bank"
within the meaning of Section 881(c)(3)(A) of the Code, two accurate
and complete original signed copies of Internal Revenue Service Form
4224 or 1001 (or successor forms) certifying such Lender's entitlement
to a complete exemption from United States withholding tax with respect
to payments to be made under this Credit Agreement and under any Note,
or (ii) if the Lender is not a "bank" within the meaning of Section
881(c)(3)(A) of the Code, either Internal Revenue Service Form 1001 or
4224 as set forth in clause (i) above, or (x) a certificate
substantially in the form of Schedule 3.13 (any such certificate, a
"3.13 Certificate") and (y) two accurate and complete original signed
copies of Internal Revenue Service Form W-8 (or successor form)
certifying such Lender's entitlement to an exemption from United States
withholding tax with respect to payments of interest to be made under
this Credit Agreement and under any Note. In addition, each Lender
agrees that it will deliver upon the Borrower's request updated
versions of the foregoing, as applicable, whenever the previous
certification has become obsolete or inaccurate in any material
respect, together with such other forms as may be required in order to
confirm or establish the entitlement of such Lender to a continued
exemption from or reduction in United States withholding tax with
respect to payments under this Credit Agreement and any Note.
Notwithstanding anything to the contrary contained in Section 3.13(a),
but subject to the immediately succeeding sentence, (x) the Borrower
shall be entitled, to the extent it is required to do so by law, to
deduct or withhold Taxes imposed by the United States (or any political
subdivision or taxing authority thereof or therein) from interest, fees
or other amounts payable hereunder for the account of any Lender which
is not a United States person (as such term is defined in Section
7701(a)(30) of the Code) for U.S. Federal income tax purposes to the
extent that such Lender has not provided to the Borrower U.S. Internal
Revenue Service Forms that establish a complete exemption from such
deduction or withholding and (y) the Borrower shall not be obligated
pursuant to Section 3.13(a) hereof to gross-up payments to be made to a
Lender in respect of Taxes imposed by the United States if (I) such
Lender has not provided to the Borrower the Internal Revenue Service
Forms required to be provided to the Borrower pursuant to this Section
3.13(b) or
31
(II) in the case of a payment, other than interest, to a Lender
described in clause (ii) above, to the extent that such Forms do not
establish a complete exemption from withholding of such Taxes.
Notwithstanding anything to the contrary contained in the preceding
sentence or elsewhere in this Section 3.13, the Borrower agrees to pay
additional amounts and to indemnify each Lender in the manner set forth
in Section 3.13(a) (without regard to the identity of the jurisdiction
requiring the deduction or withholding) in respect of any amounts
deducted or withheld by it as described in the immediately preceding
sentence as a result of any changes after the Closing Date in any
applicable law, treaty, governmental rule, regulation, guideline or
order, or in the interpretation thereof, relating to the deducting or
withholding of Taxes.
(c) Each Lender agrees to use reasonable efforts (including
reasonable efforts to change its LIBOR Lending Office, as the case may
be) to avoid or to minimize any amounts which might otherwise be
payable pursuant to this Section; provided, however, that such efforts
shall not cause the imposition on such Lender of any additional costs
or legal or regulatory burdens deemed by such Lender in its reasonable
discretion to be material.
(d) If the Borrower pays any additional amount pursuant to
this Section 3.13 with respect to a Lender, such Lender shall use
reasonable efforts to obtain a refund of tax or credit against its tax
liabilities on account of such payment; provided that such Lender shall
have no obligation to use such reasonable efforts if either (i) it is
in an excess foreign tax credit position or (ii) it believes in good
faith, in its sole discretion, that claiming a refund or credit would
cause adverse tax consequences to it. In the event that such Lender
receives such a refund or credit, such Lender shall pay to the Borrower
an amount that such Lender reasonably determines is equal to the net
tax benefit obtained by such Lender as a result of such payment by the
Borrower. In the event that no refund or credit is obtained with
respect to the Borrower's payments to such Lender pursuant to this
Section 3.13, then such Lender shall upon request provide a
certification that such Lender has not received a refund or credit for
such payments. Nothing contained in this Section 3.13 shall require a
Lender to disclose or detail the basis of its calculation of the amount
of any tax benefit or any other amount or the basis of its
determination referred to in the proviso to the first sentence of this
Section 3.13 to the Borrower or any other party.
(e) The agreements in this Section 3.13 shall survive the
termination of this Credit Agreement and the payment of the Notes and
all other amounts payable hereunder.
SECTION 4
CONDITIONS
4.1 Conditions to Closing.
This Credit Agreement shall become effective upon, and the obligation
of each Lender to make the initial Loans is subject to, the satisfaction of the
following conditions precedent:
32
(a) Execution of Credit Agreement and Credit Documents. Receipt of (i)
multiple counterparts of this Credit Agreement, (ii) a Revolving Note for each
Lender and (iii) an executed copy of the Three Year Credit Agreement, in each
case executed by a duly authorized officer of each party thereto and in each
case conforming to the requirements of this Credit Agreement.
(b) Legal Opinion. Receipt of a legal opinion of counsel to the Credit
Parties relating to this Credit Agreement and the other Credit Documents and the
transactions contemplated herein and therein, in form and substance reasonably
acceptable to the Administrative Agent, which opinion shall include, without
limitation, an opinion that the execution, delivery and performance of the
Credit Documents and the performance of the transactions contemplated thereby
will not conflict with, result in a breach of, require any consent or permit any
acceleration of (or require repayment of) any Indebtedness of the Credit Parties
or under any of the Credit Parties' corporate instruments and material
agreements.
(c) Financial Information. Receipt by the Administrative Agent of the
financial information of the Borrower and its Subsidiaries referred to in
Section 5.1(a) and the three-year financial and operational projections for the
Borrower and its Subsidiaries referred to in Section 5.1(b), in form and
substance satisfactory to the Administrative Agent.
(d) Absence of Legal Proceedings. Except as set forth on Schedule 5.6,
the absence of any material pending or threatened action, suit, investigation,
proceeding, bankruptcy or insolvency, injunction, order or claim with respect to
the Borrower or any of its Subsidiaries.
(e) Corporate Documents. Receipt of the following (or their equivalent)
for each Credit Party, each (other than with respect to clause (iv)) certified
by the secretary or assistant secretary of such Credit Party as of the Closing
Date to be true and correct and in force and effect pursuant to a certificate
substantially in the form attached hereto as Schedule 4.1(e):
(i) Articles of Incorporation. Copies of the articles of
incorporation or charter documents certified to be true and complete as
of a recent date by the appropriate Governmental Authority of the state
of its organization.
(ii) Resolutions. Copies of resolutions of the Board of
Directors or comparable managing body approving and adopting the
respective Credit Documents, the transactions contemplated therein and
authorizing execution and delivery thereof.
(iii) Bylaws. Copies of the bylaws, operating agreement or
partnership agreement certified by a secretary or assistant secretary
as of the Closing Date to be true and correct and in force and effect
as of such date.
(iv) Good Standing. Copies, where applicable, of certificates
of good standing, existence or its equivalent certified as of a recent
date by the appropriate Governmental Authorities of the State of
organization and each other State in which the failure to so qualify
and be in good standing would be reasonably likely to have a Material
Adverse Effect.
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(f) Fees. Receipt by the Administrative Agent and the Lenders of all
fees, if any, then owing pursuant to the Fee Letter, Section 3.5 or pursuant to
any Credit Document.
(g) Account Designation Letter. Receipt by the Administrative Agent of
an executed counterpart of the Account Designation Letter.
(h) Officer's Certificate. Receipt by the Administrative Agent of a
certificate of a Responsible Officer certifying that (i) each of the Borrower
and the Guarantors is solvent as of the Closing Date and (ii) the Borrower is in
pro forma compliance with all of the covenants in Section 6.7 both before and
after giving effect to any Loans to be made on the Closing Date.
(i) Payment Instructions. Receipt by the Administrative Agent of
payment instructions with respect to each wire transfer to be made by the
Administrative Agent on behalf of the Lenders or the Borrower on the Closing
Date setting forth the amount of such transfer, the purpose of such transfer,
the name and number of the account to which such transfer is to be made, the
name and ABA number of the bank or other financial institution where such
account is located and the name and telephone number of an individual that can
be contacted to confirm receipt of such transfer.
(j) No Material Adverse Effect. Except as set forth on Schedule 4.1(j),
no Material Adverse Effect shall have occurred since December 31, 2000 (other
than as has been publicly disclosed from December 31, 2000 to January 24, 2002
in filings with the Securities and Exchange Commission or in press releases that
have been widely distributed (e.g. PR Newswire or Dow Xxxxx Newswire)).
(k) Consolidated EBITDA. Receipt by the Administrative Agent of
evidence satisfactory to the Administrative Agent that Consolidated EBITDA for
the twelve-month period ending on the last day of the last complete calendar
quarter immediately preceding the Closing Date was not less than $200,000,000.
(l) Evidence of Insurance. The Administrative Agent shall be satisfied
that the Borrower has in effect insurance policies for liability, casualty and
business interruption on terms and in coverage amounts comparable to the
industry standard applicable to the Borrower's assets and operations.
(m) Existing Indebtedness. All of the existing Indebtedness for
borrowed money of the Borrower and its Subsidiaries (other than Indebtedness
permitted to exist pursuant to Section 7.1) shall be repaid in full and
terminated and all security interests and Liens related thereto (if any) shall
be terminated and released on the Closing Date.
(n) Consents. The Administrative Agent shall have received evidence
that all necessary governmental, corporate, shareholder and third party consents
and approvals, if any, in connection with the financings and other transactions
contemplated hereby have been received and no condition exists which would
reasonably be likely to restrain, prevent or impose any material adverse
conditions on the transactions contemplated hereby.
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(o) Additional Matters. All other documents and legal matters in
connection with the transactions contemplated by this Credit Agreement shall be
reasonably satisfactory in form and substance to the Administrative Agents and
the Required Lenders.
4.2 Conditions to All Loans.
The obligation of each Lender to make any Loan hereunder (including the
initial Loans to be made hereunder) is subject to the satisfaction of the
following conditions precedent on the date of making such Loan:
(a) Representations and Warranties. The representations and warranties
made by any Credit Party herein or in any other Credit Document or which are
contained in any certificate furnished at any time under or in connection
herewith or therewith shall be true and correct in all material respects on and
as of the date of such Loan as if made on and as of such date (except for those
which expressly relate to an earlier date).
(b) No Default or Event of Default. No Default or Event of Default
shall have occurred and be continuing on such date or after giving effect to the
Loan to be made on such date unless such Default or Event of Default shall have
been waived in accordance with this Credit Agreement.
Each request for a Loan (including extensions and conversions) and each
acceptance by the Borrower of a Loan (including extensions and conversions)
shall be deemed to constitute a representation and warranty by each of the
Credit Parties as of the date of such Loan that the conditions in subsections
(a) and (b) of this Section have been satisfied.
SECTION 5
REPRESENTATIONS AND WARRANTIES
To induce the Lenders to enter into this Credit Agreement and to make
Loans herein provided for, each of the Credit Parties hereby represents and
warrants to the Administrative Agent and to each Lender that:
5.1 Financial Condition.
(a) Each of the financial statements described below (copies of which
have heretofore been provided to the Administrative Agent for distribution to
the Lenders), have been prepared in accordance with GAAP consistently applied
throughout the periods covered thereby, and present fairly in all material
respects the financial condition and results from operations of the entities and
for the periods specified, subject in the case of interim company-prepared
statements to normal year-end adjustments:
35
(i) audited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries dated as of December 31, 2000, together with
related statements of income and cash flows certified by Deloitte &
Touche LLP, certified public accountants; and
(ii) a company-prepared consolidated condensed balance sheet
of the Borrower and its consolidated Subsidiaries dated as of December
31, 2001, together with related consolidated condensed statements of
income and cash flows for the period from January 1, 2001 through
December 31, 2001.
(b) The three-year financial and operations projections of the Borrower
and its Subsidiaries have been prepared in good faith based upon assumptions
believed by the Borrower to be reasonable at the time made.
5.2 No Material Adverse Change.
Except as set forth on Schedule 4.1(j), since December 31, 2000, there
has not occurred a change in the business, assets, liabilities (financial or
otherwise) of the Borrower and its Subsidiaries taken as a whole which is
reasonably likely to have a Material Adverse Effect (other than as has been
publicly disclosed from December 31, 2000 to January 24, 2002 in filings with
the Securities and Exchange Commission or in press releases made by the Borrower
in financial publications that have been widely distributed (e.g. PR Newswire or
Dow Xxxxx Newswire) or through publication on the Borrower's website).
5.3 Organization; Existence.
Each Credit Party (a) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, (b) has the
corporate or other necessary power and authority, and the legal right to own and
operate its property, to lease the property it operates as lessee and to conduct
the business in which it is currently engaged and (c) is duly qualified as a
foreign entity and in good standing under the laws of each jurisdiction where
its ownership, lease or operation of property or the conduct of its business
requires such qualification, other than in such jurisdictions where the failure
to be so qualified and in good standing would not, in the aggregate, have a
Material Adverse Effect.
5.4 Power; Authorization; Enforceable Obligations.
Each Credit Party has the corporate or other necessary power and
authority, and the legal right, to make, deliver and perform the Credit
Documents to which it is a party and has taken all necessary corporate or other
action to authorize the execution, delivery and performance by it of the Credit
Documents to which it is a party. No consent or authorization of, filing with,
notice to or other act by or in respect of, any Governmental Authority or any
other Person is required in connection with acceptance of extensions of credit
by the Borrower or the making of the guaranties hereunder or with the execution,
delivery or performance of any Credit Documents by the Credit Parties (other
than those which have been obtained) or with the validity or enforceability of
any Credit Document against the Credit Parties. Each Credit Document to which it
is a party constitutes a valid and legally binding obligation of each Credit
Party
36
enforceable in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general equity
principles.
5.5 Conflict.
The execution, delivery and performance of the Credit Documents, the
borrowings hereunder and the use of the proceeds of the Loans will not (a)
violate any Requirement of Law applicable to the Borrower or any of its
Subsidiaries (except those as to which waivers or consents have been obtained),
(b) conflict with, result in a breach of or constitute a default under (i) the
articles of incorporation, bylaws or other organizational documents of such
Person, (ii) any material indenture, agreement or other instrument to which such
Person is a party or by which any of its properties may be bound or (iii) any
approval of any Governmental Authority relating to such Person, or (c) result
in, or require, the creation or imposition of any Lien on any of their
respective properties or revenues pursuant to any Requirement of Law or any
Material Contract.
5.6 No Material Litigation.
No claim, litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the best knowledge of the
Credit Parties, threatened by or against any Credit Party or any of its
Subsidiaries or against any of their respective properties which (a) relates to
the Credit Documents or any of the transactions contemplated hereby or thereby
or (b) is reasonably likely to have a Material Adverse Effect. Set forth on
Schedule 5.6 is a summary of material litigation matters pending as of the
Closing Date.
5.7 No Default.
No Default or Event of Default has occurred and is continuing.
5.8 Taxes.
Each of the Credit Parties and its Subsidiaries has filed, or caused to
be filed, all tax returns (federal, state, local and foreign) required to be
filed and paid (a) all amounts of taxes shown thereon to be due (including
interest and penalties) and (b) all other taxes, fees, assessments and other
governmental charges (including mortgage recording taxes, documentary stamp
taxes and intangibles taxes) owing by it, except for such taxes (i) which are
not yet delinquent or (ii) that are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with GAAP. Neither any of the Credit Parties nor any of its
Subsidiaries are aware as of the Closing Date of any proposed tax assessments
against it or any of its Subsidiaries which could reasonably be expected to have
a Material Adverse Effect.
37
5.9 ERISA
Neither a Reportable Event nor an "accumulated funding deficiency"
(within the meaning of Section 412 of the Code or Section 302 of ERISA) has
occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan, and each Plan
has complied in all material respects with the applicable provisions of ERISA
and the Code, except to the extent that any such occurrence or failure to comply
would not reasonably be expected to have a Material Adverse Effect. No
termination of a Single Employer Plan has occurred resulting in any liability
that has remained underfunded, and no Lien in favor of the PBGC or a Plan has
arisen, during such five-year period which could reasonably be expected to have
a Material Adverse Effect. The present value of all accrued benefits under each
Single Employer Plan (based on those assumptions used to fund such Plans) did
not, as of the last annual valuation date prior to the date on which this
representation is made or deemed made, exceed the value of the assets of such
Plan allocable to such accrued benefits by an amount which, as determined in
accordance with GAAP, could reasonably be expected to have a Material Adverse
Effect. Neither the Borrower nor any Commonly Controlled Entity is currently
subject to any liability for a complete or partial withdrawal from a
Multiemployer Plan which could reasonably be expected to have a Material Adverse
Effect.
5.10 Governmental Regulations, Etc.
(a) No part of the proceeds of the Loans hereunder will be used,
directly or indirectly, for the purpose of purchasing or carrying any "margin
stock" within the meaning of Regulation U, or for the purpose of purchasing or
carrying or trading in any securities. If requested by any Lender or the
Administrative Agent, the Borrower will furnish to the Administrative Agent and
each Lender a statement to the foregoing effect in conformity with the
requirements of FR Form U-1 referred to in said Regulation U. No Indebtedness
being reduced or retired out of the proceeds of the Loans hereunder was or will
be incurred for the purpose of purchasing or carrying any margin stock within
the meaning of Regulation U or any "margin security" within the meaning of
Regulation T. "Margin stock" within the meaning of Regulation U does not
constitute more than 25% of the value of the consolidated assets of the Borrower
and its Subsidiaries. Neither the execution and delivery hereof by the Borrower,
nor the performance by it of any of the transactions contemplated by this Credit
Agreement (including, without limitation, the direct or indirect use of the
proceeds of the Loans) will violate or result in a violation of the Securities
Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, or
regulations issued pursuant thereto, or Regulation T, U or X.
(b) None of the Credit Parties is (i) an "investment company"
registered or required to be registered under the Investment Company Act of
1940, as amended, and is not controlled by such a company, or (ii) a "holding
company", or a "subsidiary company" of a "holding company", or an "affiliate" of
a "holding company" or of a "subsidiary" of a "holding company", within the
meaning of the Public Utility Holding Company Act of 1935, as amended.
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5.11 Subsidiaries.
Set forth on Schedule 5.11 is a list of all the Subsidiaries of the
Credit Parties as of the Closing Date, including a list of the Material Domestic
Subsidiaries of the Borrower, the jurisdiction of their incorporation and the
direct or indirect ownership interest of the Borrower therein.
5.12 Use of Proceeds.
The Loans will be used solely (a) to refinance certain existing
Indebtedness, (b) to provide general working capital and (c) for other general
corporate purposes.
5.13 Compliance with Laws; Contractual Obligations.
Each Credit Party and each Subsidiary is in compliance with all
Requirements of Law, except to the extent that the failure to comply therewith
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. None of the Credit Parties is in default under or with
respect to any of its contractual obligations in any respect which could
reasonably be expected to have a Material Adverse Effect.
5.14 Accuracy and Completeness of Information.
As of the Closing Date, to the best of the Borrower's knowledge, no
representation or warranty of the Borrower or any of its Subsidiaries contained
in this Credit Agreement or any other Credit Document or in any other document,
certificate or written statement furnished to the Lenders by or on behalf of the
Borrower or any of its Subsidiaries contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the statements
contained in such agreements, documents, certificates and statements not
misleading in light of the circumstances in which the same were made.
5.15 Environmental Matters.
(a) The Borrower and each of its Subsidiaries is in compliance in all
material respects with all Environmental Laws the non-compliance with which
could reasonably be expected to have a Material Adverse Effect.
(b) There has been no "release or threatened release of a hazardous
substance" (as defined by the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended, 42 U.S.C. Section 9601 et seq.) or any
other release, emission or discharge into the environment of any hazardous or
toxic substance, pollutant or other materials from the Borrower's or its
Subsidiaries' property other than as permitted under applicable Environmental
Law and other than those which would not have a Material Adverse Effect. Other
than disposals (i) for which the Borrower has been indemnified in full or (ii)
which would not have a Material Adverse Effect, all "hazardous waste" (as
defined by the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et
seq. (1976) and the regulations thereunder, 40 CFR Part 261 ("RCRA")) generated
at the Borrower's or any Subsidiaries' properties have in the past been and
39
shall continue to be disposed of at sites which maintain valid permits under
RCRA and any applicable state or local Environmental Law.
5.16 Solvency.
The fair saleable value of the Credit Parties' assets taken as a whole,
measured on a going concern basis, exceeds all probable liabilities, including
those to be incurred pursuant to this Credit Agreement. None of the Credit
Parties (a) has unreasonably small capital in relation to the business in which
it is or proposes to be engaged or (b) has incurred, or believes that it will
incur after giving effect to the transactions contemplated by this Credit
Agreement, debts beyond its ability to pay such debts as they become due.
5.17 No Burdensome Restrictions.
None of the Borrower or any of its Subsidiaries is a party to any
agreement or instrument or subject to any other obligation or any charter or
corporate restriction or any provision of any applicable law, rule or regulation
which, individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
5.18 Material Contracts.
Schedule 5.18 sets forth a true and correct and complete list of all
Material Contracts currently in effect as of the Closing Date. All of the
Material Contracts are in full force and effect and no material defaults
currently exist thereunder.
5.19 Insurance.
The Borrower and its Subsidiaries maintain insurance policies for
liability, casualty and business interruption on terms and in coverage amounts
comparable to the industry standard applicable to the assets and operations of
the Borrower and its Subsidiaries.
SECTION 6
AFFIRMATIVE COVENANTS
The Credit Parties covenant and agree that on the Closing Date, and so
long as this Credit Agreement is in effect and until the Commitments have been
terminated, no Loans remain outstanding and all amounts owing hereunder or under
any other Credit Document or in connection herewith or therewith have been paid
in full, the Credit Parties shall, and shall cause each Subsidiary to:
6.1 Financial Statements.
Furnish, or cause to be furnished, to the Administrative Agent for
distribution to the Lenders:
40
(a) Audited Financial Statements. As soon as available, but in any
event within 90 days after the end of each fiscal year of the Borrower, an
audited consolidated and consolidating balance sheet of the Borrower and its
Subsidiaries as of the end of the fiscal year and the related consolidated and
consolidating statements of income, retained earnings, shareholders' equity and
cash flows for the year, audited by an independent certified public accounting
firm of nationally recognized standing, setting forth in each case in
comparative form the figures for the previous year, reported without a "going
concern" or like qualification or exception, or qualification indicating that
the scope of the audit was inadequate to permit such independent certified
public accountants to certify such financial statements without such
qualification.
(b) Company-Prepared Financial Statements. As soon as available, but in
any event within 45 days after the end of each fiscal quarters of the Borrower,
a company-prepared consolidated and consolidating balance sheet of the Borrower
and its Subsidiaries as of the end of the quarter and related company-prepared
consolidated and consolidating statements of income, retained earnings,
shareholders' equity and cash flows for such quarterly period and for the fiscal
year to date; in each case setting forth in comparative form the consolidated
figures for the corresponding period or periods of the preceding fiscal year or
the portion of the fiscal year ending with such period, as applicable, in each
case subject to normal recurring year-end audit adjustments.
All such financial statements shall fairly present in all material respects the
financial condition of the Borrower (subject, in the case of interim statements,
to normal recurring year-end audit adjustments) and shall be prepared in
reasonable detail and in accordance with GAAP applied consistently throughout
the periods reflected therein and further accompanied by a description of, and
an estimation of the effect on the financial statements on account of, a change
in the application of accounting principles as provided in Section 1.3.
6.2 Certificates; Other Information.
Furnish, or cause to be furnished, to the Administrative Agent for
distribution to the Lenders:
(a) Officer's Certificate. Concurrently with the delivery of the
financial statements referred to in Sections 6.1(a) and 6.1(b) above, a
certificate of a Responsible Officer stating that, to the best of such
Responsible Officer's knowledge and belief, (i) the financial statements fairly
present in all material respects the financial condition of the parties covered
by such financial statements, (ii) during such period each Credit Party has
observed or performed its covenants and other agreements hereunder and under the
other Credit Documents, and satisfied the conditions contained in this Credit
Agreement to be observed, performed or satisfied by it (except to the extent
waived in accordance with the provisions hereof) and (iii) such Responsible
Officer has obtained no knowledge of any Default or Event of Default except as
specified in such certificate. Such certificate shall include the calculations
required to indicate compliance with Section 6.7 as of the last day of the
period covered by such financial statements. A form of Officer's Certificate is
attached as Schedule 6.2(a).
41
(b) Public Information. Promptly after the same are sent, copies of all
reports (other than those otherwise provided pursuant to Section 6.1) and other
financial information which any Credit Party sends to its public stockholders,
and promptly after the same are filed, copies of all financial statements and
non-confidential reports which any Credit Party may make to, or file with, the
Securities and Exchange Commission or any successor or analogous United States
Governmental Authority.
(c) Other Information. Promptly, such additional financial and other
information as the Administrative Agent, at the request of any Lender, may from
time to time reasonably request.
6.3 Notices.
Give notice to the Administrative Agent (which shall promptly transmit
such notice to each Lender) of:
(a) Defaults. Promptly (but in any event within two (2) Business Days),
after any Credit Party knows or has reason to know thereof, the occurrence of
any Default or Event of Default.
(b) Legal Proceedings. Promptly, any litigation, or any investigation
or proceeding (including without limitation, any environmental proceeding) known
to a Credit Party and not set forth on Schedule 5.6, relating to a Credit Party
or any of its Subsidiaries which, if adversely determined, would reasonably be
expected to have a Material Adverse Effect.
(c) ERISA. Promptly, (i) the occurrence or expected occurrence of any
Reportable Event with respect to any Plan, a failure to make any required
contribution to a Plan, the creation of any Lien in favor of the PBGC (other
than a Permitted Lien) or a Plan or any withdrawal from, or the termination,
Reorganization or Insolvency of, any Multiemployer Plan or (ii) the institution
of proceedings or the taking of any other action by the PBGC or the Borrower or
any Commonly Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the terminating, Reorganization or Insolvency of, any Plan;
(d) Change in Debt Rating. Promptly, any change in the Borrower's Debt
Rating as provided by S&P or Xxxxx'x.
(e) Change in Fiscal Year. Promptly, any change in the fiscal year of
the Borrower or any of its Subsidiaries.
(f) Other. Promptly, any other development or event which a Responsible
Officer of the Borrower determines is reasonably likely to have a Material
Adverse Effect.
Each notice pursuant to this Section shall be accompanied by a statement of a
Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the Borrower proposes to take with
respect thereto.
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6.4 Maintenance of Existence; Compliance with Laws; Contractual
Obligations.
(a) Preserve, renew and keep in full force and effect its corporate
existence and take all reasonable action to maintain all rights, privileges,
licenses and franchises necessary or desirable in the normal conduct of its
business.
(b) Comply with all Requirements of Law (including, without limitation,
all Environmental Laws and ERISA) applicable to it except to the extent that
failure to comply therewith would not, in the aggregate, have a Material Adverse
Effect.
(c) Fully perform and satisfy all of its obligations under all of its
contractual obligations except to the extent that failure to perform and satisfy
such obligations would not, in the aggregate, have a Material Adverse Effect.
6.5 Maintenance of Property; Insurance.
Keep all material property useful and necessary in its business in
reasonably good working order and condition (ordinary wear and tear excepted);
maintain with financially sound and reputable insurance companies casualty,
liability, business interruption and such other insurance (which may include
plans of self-insurance) with such coverage and deductibles, and in such amounts
as may be consistent with prudent business practice and in any event consistent
with normal industry practice; and furnish to the Administrative Agent, upon
written request, full information as to the insurance carried.
6.6 Inspection of Property; Books and Records; Discussions.
Keep proper books of records and account in which full, true and
correct entries in conformity with GAAP and all Requirements of Law shall be
made of all dealings and transactions in relation to its businesses and
activities; and permit, during regular business hours and upon reasonable notice
by the Administrative Agent, the Administrative Agent to visit and inspect any
of its properties and examine and make abstracts (including photocopies) from
any of its books and records at any reasonable time, and to discuss the
business, operations, properties and financial and other condition of the Credit
Parties and their Subsidiaries with officers and employees of the Credit Parties
and their Subsidiaries and with their independent certified public accountants.
The cost of the inspection referred to in the preceding sentence shall be for
the account of the Lenders unless an Event of Default has occurred and is
continuing, in which case the cost of such inspection shall be for the account
of the Borrower.
6.7 Financial Covenants.
(a) Consolidated Net Worth. Maintain Consolidated Net Worth at all
times (which shall be calculated as of the end of each fiscal quarter) of not
less than $100,000,000 plus 50% of Consolidated Net Income (if positive) from
the Closing Date to the date of computation.
(b) Leverage Ratio. Maintain a Leverage Ratio at all times (which shall
be calculated as of the end of each fiscal quarter) of not greater than 3.00 to
1.00.
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6.8 Use of Proceeds.
Use the Loans solely for the purposes provided in Section 5.12.
6.9 Additional Guarantors.
Cause each of the Borrower's Material Domestic Subsidiaries which is
not a party to this Credit Agreement, whether newly formed, after acquired or
otherwise existing, to promptly become a "Guarantor" hereunder by way of
execution of a Joinder Agreement.
6.10 Payment of Obligations.
Pay, discharge or otherwise satisfy at or before maturity or before
they become delinquent, as the case may be, all its taxes (Federal, state, local
and any other taxes) and all its other obligations and liabilities of whatever
nature and any additional costs that are imposed as a result of any failure to
so pay, discharge or otherwise satisfy such obligations and liabilities, except
when the amount or validity of such obligations, liabilities and costs is
currently being contested in good faith by appropriate proceedings and reserves,
if applicable, in conformity with GAAP with respect thereto have been provided
on the books of the Borrower or its Subsidiaries, as the case may be.
6.11 Environmental Laws.
(a) Comply in all material respects with, and ensure compliance in all
material respects by all tenants and subtenants, if any, with, all applicable
Environmental Laws and obtain and comply in all material respects with and
maintain, and ensure that all tenants and subtenants obtain and comply in all
material respects with and maintain, any and all licenses, approvals,
notifications, registrations or permits required by applicable Environmental
Laws except to the extent that failure to do so could not reasonably be expected
to have a Material Adverse Effect;
(b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding Environmental
Laws except to the extent that the same are being contested in good faith by
appropriate proceedings and the pendency of such proceedings could not
reasonably be expected to have a Material Adverse Effect; and
(c) Defend, indemnify and hold harmless the Administrative Agent and
the Lenders, and their respective employees, agents, officers and directors and
affiliates, from and against any and all claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or nature
known or unknown, contingent or otherwise, arising out of, or in any way
relating to the violation of, noncompliance with or liability under, any
Environmental Law applicable to the operations of the Credit Parties or any of
their Subsidiaries or their Properties, or any orders, requirements or demands
of Governmental Authorities related thereto, including, without limitation,
reasonable attorney's and consultant's fees, investigation and laboratory fees,
44
response costs, court costs and litigation expenses, except to the extent that
any of the foregoing arise out of the gross negligence or willful misconduct of
the party seeking indemnification therefor. The agreements in this paragraph
shall survive repayment of the Notes and all other amounts payable hereunder.
SECTION 7
NEGATIVE COVENANTS
The Credit Parties covenant and agree that on the Closing Date, and so
long as this Credit Agreement is in effect and until the Commitments have been
terminated, no Loans remain outstanding and all amounts owing hereunder or under
any other Credit Document or in connection herewith or therewith have been paid
in full, the Credit Parties shall not and shall not permit any Subsidiary to:
7.1 Indebtedness.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to, contract, create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness arising or existing under this Credit Agreement and
the other Credit Documents;
(b) Indebtedness of the Borrower and its Subsidiaries existing as of
the Closing Date as referenced in the financial statements referenced in Section
5.1 (and set out more specifically in Schedule 7.1(b)) hereto and renewals,
refinancings, extensions or replacements thereof in a principal amount not in
excess of that outstanding as of the Closing Date;
(c) Indebtedness of the Borrower and its Subsidiaries incurred after
the Closing Date consisting of Capital Leases or Indebtedness incurred to
provide all or a portion of the purchase price or cost of construction of an
asset provided that (i) such Indebtedness when incurred shall not exceed the
purchase price or cost of construction of such asset; (ii) no such Indebtedness
shall be refinanced for a principal amount in excess of the principal balance
outstanding thereon at the time of such refinancing; and (iii) the total amount
of all such Indebtedness shall not exceed $25,000,000 at any time outstanding;
(d) Unsecured intercompany Indebtedness among the Credit Parties,
provided that any such Indebtedness shall be fully subordinated to the Credit
Party Obligations hereunder on terms reasonably satisfactory to the
Administrative Agent;
(e) Indebtedness and obligations owing under Hedging Agreements entered
into in order to manage existing or anticipated interest rate, exchange rate or
commodity price risks and not for speculative purposes;
(f) Indebtedness and obligations of Credit Parties owing under
documentary letters of credit for the purchase of goods or other merchandise
generally;
45
(g) Guaranty Obligations in respect of Indebtedness of a Credit Party
to the extent such Indebtedness is permitted to exist or be incurred pursuant to
this Section 7.1;
(h) obligations in connection with any Permitted Receivables Financing,
to the extent such obligations constitute Indebtedness;
(i) unsecured Indebtedness of Foreign Subsidiaries to the extent that
any such Indebtedness is non-recourse to the Borrower or any Domestic
Subsidiary; and
(j) other unsecured Indebtedness of the Borrower which does not exceed
$200,000,000 in the aggregate at any time outstanding.
7.2 Liens.
Each of the Credit Parties will not, nor will it permit any Material
Domestic Subsidiary to, contract, create, incur, assume or permit to exist any
Lien with respect to any of its property or assets of any kind (whether real or
personal, tangible or intangible), whether now owned or hereafter acquired,
except for Permitted Liens.
7.3 Nature of Business.
Each of the Credit Parties will not, nor will it permit any Material
Domestic Subsidiary to, alter the character of its business in any material
respect from that conducted as of the Closing Date (it being understood and
agreed that any consumer packaged goods line of business shall be deemed to be
within the character of the Credit Parties' businesses).
7.4 Consolidation, Merger, Sale or Purchase of Assets, etc.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to,
(a) dissolve, liquidate or wind up its affairs, sell, transfer, lease
or otherwise dispose of its property or assets or agree to do so at a future
time except the following, without duplication, shall be expressly permitted:
(i) the sale, transfer, lease or other disposition of
inventory (whether current, obsolete or excess) and materials in the
ordinary course of business;
(ii) the sale, transfer or other disposition of cash and Cash
Equivalents;
(iii) (A) the disposition of property or assets as a direct
result of a Recovery Event or (B) the sale, lease, transfer or other
disposition of machinery, parts and equipment no longer used or useful
in the conduct of the business of the Borrower or any of its
Subsidiaries, so long as the net proceeds therefrom are used to replace
such machinery, parts and equipment or to purchase or otherwise acquire
new assets or property within 180 days of receipt of the net proceeds;
46
(iv) the sale, lease or transfer of property or assets between
Credit Parties;
(v) any sale of Transferred Assets by such Person to a
Receivables Financier in connection with a Permitted Receivables
Financing;
(vi) the sale of assets attributable to the Borrower's (A)
Argentinean operations and (B) Armour food business; and
(vii) the sale, lease or transfer of property or assets not to
exceed $20,000,000 in the aggregate in any fiscal year;
provided, that, in the case of clauses (ii), (iii), (vi) and (vii)
above, at least 75% of the consideration received therefor by the Borrower or
any such Subsidiary is in the form of cash or Cash Equivalents; or
(b) (i) purchase, lease or otherwise acquire (in a single transaction
or a series of related transactions) the property or assets of any Person (other
than purchases or other acquisitions of inventory, materials, property and
equipment in the ordinary course of business, except as otherwise limited or
prohibited herein) or (ii) enter into any transaction of merger or
consolidation, except for (A) investments or acquisitions permitted pursuant to
Section 7.5, and (B) the merger or consolidation of a Credit Party with and into
another Credit Party; provided that if the Borrower is a party thereto, the
Borrower will be the surviving corporation.
7.5 Advances, Investments and Loans.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to, make any Investment except for Permitted Investments.
7.6 Transactions with Affiliates.
Except as permitted in subsection (iv) of the definition of Permitted
Investments, each of the Credit Parties will not, nor will it permit any
Subsidiary to, enter into any transaction or series of transactions, whether or
not in the ordinary course of business, with any officer, director, shareholder
or Affiliate other than on terms and conditions substantially as favorable as
would be obtainable in a comparable arm's-length transaction with a Person other
than an officer, director, shareholder or Affiliate.
7.7 Fiscal Year; Organizational Documents; Material Contracts.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to, amend, modify or change its articles of incorporation (or corporate charter
or other similar organizational document) or bylaws (or other similar document)
without the prior written consent of the Required Lenders. Each of the Credit
Parties will not, nor will it permit any Subsidiary to, without the prior
written consent of the Administrative Agent, amend, modify, cancel or terminate
or fail to renew or extend or permit the amendment, modification, cancellation
or
47
termination of any of the Material Contracts, except in the event that such
amendments, modifications, cancellations or terminations could not reasonably be
expected to have a Material Adverse Effect.
7.8 Limitation on Restricted Actions.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to, directly or indirectly, create or otherwise cause or suffer to exist or
become effective any encumbrance or restriction on the ability of any such
Person to (a) pay dividends or make any other distributions to any Credit Party
on its Capital Stock or with respect to any other interest or participation in,
or measured by, its profits, (b) pay any Indebtedness or other obligation owed
to any Credit Party, (c) make loans or advances to any Credit Party, (d) sell,
lease or transfer any of its properties or assets to any Credit Party, or (e)
act as a Guarantor and pledge its assets pursuant to the Credit Documents or any
renewals, refinancings, exchanges, refundings or extension thereof, except (in
respect of any of the matters referred to in clauses (a)-(d) above) for such
encumbrances or restrictions existing under or by reason of (i) this Credit
Agreement and the other Credit Documents, (ii) applicable law, (iii) any
document or instrument governing Indebtedness incurred pursuant to Section
7.1(c); provided that any such restriction contained therein relates only to the
asset or assets constructed or acquired in connection therewith, or (iv) any
Permitted Lien or any document or instrument governing any Permitted Lien;
provided that any such restriction contained therein relates only to the asset
or assets subject to such Permitted Lien.
7.9 Restricted Payments.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to, directly or indirectly, declare, order, make or set apart any sum for or pay
any Restricted Payment, except (a) to make dividends payable solely in the same
class of Capital Stock of such Person, (b) to make dividends or other
distributions payable to any Credit Party (directly or indirectly through
Subsidiaries) and (c) the Borrower may pay dividends so long as, after giving
effect thereto on a pro forma basis, no Default or Event of Default shall exist.
7.10 Sale Leasebacks.
The Credit Parties will not, directly or indirectly, become or remain
liable as lessee or as guarantor or other surety with respect to any lease,
whether an operating lease or a Capital Lease, of any property (whether real,
personal or mixed), whether now owned or hereafter acquired, in an aggregate
amount exceeding $40,000,000 at any time outstanding (a) which any Credit Party
has sold or transferred or is to sell or transfer to a Person which is not
another Credit Party or (b) which any Credit Party intends to use for
substantially the same purpose as any other property which has been sold or is
to be sold or transferred by such Credit Party to another Person which is not
another Credit Party in connection with such lease.
7.11 No Further Negative Pledges.
Each of the Credit Parties will not, nor will it permit any Subsidiary
to, enter into, assume or become subject to any agreement prohibiting or
otherwise restricting the creation or
48
assumption of any Lien upon its properties or assets, whether now owned or
hereafter acquired, or requiring the grant of any security for such obligation
if security is given for some other obligation, except (a) pursuant to this
Credit Agreement and the other Credit Documents, (b) pursuant to any document or
instrument governing Indebtedness incurred pursuant to Section 7.1(c), provided
that any such restriction contained therein relates only to the asset or assets
constructed or acquired in connection therewith and (c) in connection with any
Permitted Lien or any document or instrument governing any Permitted Lien,
provided that any such restriction contained therein relates only to the asset
or assets subject to such Permitted Lien.
SECTION 8
EVENTS OF DEFAULT
8.1 Events of Default.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) The Borrower shall fail to pay any principal on any Loan when due
in accordance with the terms hereof; or the Borrower shall fail to pay any
interest on any Loan or any Fee or other amount payable hereunder when due in
accordance with the terms hereof and such failure shall continue unremedied for
three (3) Business Days (or any Guarantor shall fail to pay on the Guaranty in
respect of any of the foregoing or in respect of any other Guaranty Obligations
thereunder within the aforesaid period of time); or
(b) Any representation or warranty made or deemed made herein or in any
of the other Credit Documents or which is contained in any certificate, document
or financial or other statement furnished at any time under or in connection
with this Credit Agreement shall prove to have been incorrect, false or
misleading in any material respect on or as of the date made or deemed made; or
(c) (i) Any Credit Party shall fail to perform, comply with or observe
any term, covenant or agreement applicable to it contained in Sections 6.3(a),
6.4(a) or 6.7 or in Section 7; or (ii) any Credit Party shall fail to comply
with any other covenant contained in this Credit Agreement or the other Credit
Documents or any other agreement, document or instrument among any Credit Party,
the Administrative Agent and the Lenders or executed by any Credit Party in
favor of the Administrative Agent or the Lenders (other than as described in
Sections 7.1(a), 7.1(b) or 7.1(c)(i) above), and in the event such breach or
failure to comply is capable of cure, is not cured within thirty (30) days after
the earlier to occur of (A) a Responsible Officer obtaining knowledge thereof or
(B) notice thereof received from the Administrative Agent of its occurrence; or
(d) Any Credit Party or any of its Subsidiaries shall (i) default in
any payment of principal of or interest on any Indebtedness (other than the
Notes) in a principal amount outstanding of at least $15,000,000 in the
aggregate for the Credit Parties and their Subsidiaries beyond the period of
grace, if any, provided in the instrument or agreement under which such
49
Indebtedness was created, (ii) default in the observance or performance of any
other agreement or condition relating to any Indebtedness in a principal amount
outstanding of at least $15,000,000 in the aggregate for the Credit Parties and
their Subsidiaries or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition exist,
the effect of which default or other event or condition is to cause, or to
permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Indebtedness (or a trustee or agent on behalf of such
holder or holders or beneficiary or beneficiaries) to cause, with the giving of
notice if required, such Indebtedness to become due prior to its stated maturity
or (iii) default in the due performance or observance of any term, covenant or
agreement under any Material Contract which results in liabilities or damages in
excess of $25,000,000 in the aggregate; or
(e) (i) Any Credit Party or any of its Subsidiaries shall commence any
case, proceeding or other action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief entered
with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee, custodian, conservator or other
similar official for it or for all or any substantial part of its assets, or any
Credit Party or any of its Subsidiaries shall make a general assignment for the
benefit of its creditors; or (ii) there shall be commenced against any Credit
Party or any of its Subsidiaries any case, proceeding or other action of a
nature referred to in clause (i) above which (A) results in the entry of an
order for relief or any such adjudication or appointment or (B) remains
undismissed, undischarged or unbonded for a period of 60 days; or (iii) there
shall be commenced against any Credit Party or any of its Subsidiaries any case,
proceeding or other action seeking issuance of a warrant of attachment,
execution, distraint or similar process against all or any substantial part of
its assets which results in the entry of an order for any such relief which
shall not have been vacated, discharged, or stayed or bonded pending appeal
within 60 days from the entry thereof; or (iv) any Credit Party or any of its
Subsidiaries shall take any action in furtherance of, or indicating its consent
to, approval of, or acquiescence in, any of the acts set forth in clauses (i),
(ii), or (iii) above; or (v) any Credit Party or any of its Subsidiaries shall
generally not, or shall be unable to, or shall admit in writing its inability
to, pay its debts as they become due; or
(f) Any final, non-appealable judgments or decrees shall be entered
against any Credit Party or any of its Subsidiaries involving in the aggregate a
liability (to the extent not paid when due or covered by insurance) of
$25,000,000 or more and any such judgments or decrees shall not have been paid
and satisfied, vacated, discharged or stayed within 10 days from the entry
thereof; or
(g) (i) Any Person shall engage in any "prohibited transaction" (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan,
(ii) any "accumulated funding deficiency" (as defined in Section 302 of ERISA),
whether or not waived, shall exist with respect to any Plan or any Lien in favor
of the PBGC or a Plan (other than a Permitted Lien) shall arise on the assets of
the Borrower or any Commonly Controlled Entity, (iii) a Reportable Event shall
occur with respect to, or proceedings shall commence to have a trustee
appointed, or a trustee
50
shall be appointed, to administer or to terminate, any Single Employer Plan,
which Reportable Event or commencement of proceedings or appointment of a
Trustee is, in the reasonable opinion of the Required Lenders, likely to result
in the termination of such Plan for purposes of Title IV of ERISA, (iv) any
Single Employer Plan shall terminate for purposes of Title IV of ERISA, (v) the
Borrower, any of its Subsidiaries or any Commonly Controlled Entity shall, or in
the reasonable opinion of the Required Lenders is likely to, incur any liability
in connection with a withdrawal from, or the Insolvency or Reorganization of,
any Multiemployer Plan or (vi) any other similar event or condition shall occur
or exist with respect to a Plan; and in each case in clauses (i) through (vi)
above, such event or condition, together with all other such events or
conditions, if any, could have a Material Adverse Effect; or
(h) There shall occur a Change of Control; or
(i) The Guaranty or any provision thereof shall cease to be in full
force and effect or any Guarantor or any Person acting by or on behalf of any
Guarantor shall deny or disaffirm any Guarantor's obligations under the
Guaranty; or
(j) Any other Credit Document shall fail to be in full force and effect
or to give the Administrative Agent and/or the Lenders the rights, powers and
privileges purported to be created thereby, or any Credit Party or any Person
acting by or on behalf of any Credit Party shall deny or disaffirm any Credit
Party Obligation.
8.2 Acceleration; Remedies.
Upon the occurrence and during the continuance of an Event of Default,
the Administrative Agent may, or upon the request and direction of the Required
Lenders shall, by written notice to the Borrower take any of the following
actions:
(i) Termination of Commitments. Declare the Commitments
terminated whereupon the Commitments shall be immediately terminated.
(ii) Acceleration. Declare the unpaid principal of and any
accrued interest in respect of all Loans and any and all other
indebtedness or obligations (including, without limitation, Fees) of
any and every kind owing by any Credit Party to the Administrative
Agent and/or any of the Lenders hereunder to be due, whereupon the same
shall be immediately due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by
each Credit Party.
(iii) Enforcement of Rights. Exercise any and all rights and
remedies created and existing under the Credit Documents, whether at
law or in equity.
(iv) Rights Under Applicable Law. Exercise any and all rights
and remedies available to the Administrative Agent or the Lenders under
applicable law.
Notwithstanding the foregoing, if an Event of Default specified in Section
8.1(e) shall occur, then the Commitments shall automatically terminate and all
Loans, all accrued interest in respect
51
thereof, all accrued and unpaid Fees and other indebtedness or obligations owing
to the Administrative Agent and/or any of the Lenders hereunder automatically
shall immediately become due and payable without presentment, demand, protest or
the giving of any notice or other action by the Administrative Agent or the
Lenders, all of which are hereby waived by the Borrower.
SECTION 9
AGENCY PROVISIONS
9.1 Appointment.
Each Lender hereby irrevocably designates and appoints First Union as
the Administrative Agent of such Lender under this Credit Agreement, and each
such Lender irrevocably authorizes First Union, as the Administrative Agent for
such Lender, to take such action on its behalf under the provisions of this
Credit Agreement and to exercise such powers and perform such duties as are
expressly delegated to the Administrative Agent by the terms of this Credit
Agreement, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Credit
Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Credit Agreement or otherwise exist against the Administrative Agent.
9.2 Delegation of Duties.
The Administrative Agent may execute any of its duties under this
Credit Agreement by or through agents or attorneys-in-fact and shall be entitled
to advice of counsel concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence or misconduct
of any agents or attorneys-in-fact selected by it with reasonable care. Without
limiting the foregoing, the Administrative Agent may appoint one of its
affiliates as its agent to perform the functions of the Administrative Agent
hereunder relating to the advancing of funds to the Borrower and distribution of
funds to the Lenders and to perform such other related functions of the
Administrative Agent hereunder as are reasonably incidental to such functions.
9.3 Exculpatory Provisions.
Neither the Administrative Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any
action lawfully taken or omitted to be taken by it or such Person under or in
connection with this Credit Agreement (except for its or such Person's own gross
negligence or willful misconduct) or (ii) responsible in any manner to any of
the Lenders for any recitals, statements, representations or warranties made by
any Credit Party or any officer thereof contained in this Credit Agreement or in
any certificate, report, statement or other document referred to or provided for
in, or received by the Administrative Agent under or in connection with, this
Credit Agreement or for the value, validity,
52
effectiveness, genuineness, enforceability or sufficiency of any of the Credit
Documents or for any failure of any Credit Party to perform its obligations
hereunder or thereunder. The Administrative Agent shall not be under any
obligation to any Lender to ascertain or to inquire as to the observance or
performance by any Credit Party of any of the agreements contained in, or
conditions of, this Credit Agreement, or to inspect the properties, books or
records of any Credit Party.
9.4 Reliance by Administrative Agent.
The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any Note, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document or conversation believed by it in
good faith to be genuine and correct and to have been signed, sent or made by
the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Credit Parties), independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless (a) a written notice of assignment, negotiation
or transfer thereof shall have been filed with the Administrative Agent and (b)
the Administrative Agent shall have received the written agreement of such
assignee to be bound hereby as fully and to the same extent as if such assignee
were an original Lender party hereto, in each case in form satisfactory to the
Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Credit Agreement unless it
shall first receive such advice or concurrence of the Required Lenders as it
deems appropriate or it shall first be indemnified to its satisfaction by the
Lenders against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action. The Administrative Agent
shall in all cases be fully protected in acting, or in refraining from acting,
under any of the Credit Documents in accordance with a request of the Required
Lenders or all of the Lenders, as may be required under this Credit Agreement,
and such request and any action taken or failure to act pursuant thereto shall
be binding upon all the Lenders and all future holders of the Notes.
9.5 Notice of Default.
The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or the Borrower referring
to this Credit Agreement, describing such Default or Event of Default and
stating that such notice is a "notice of default". In the event that the
Administrative Agent receives such a notice, the Administrative Agent shall give
prompt notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders; provided, however, that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders except to the extent that
this Credit Agreement expressly requires that such action be taken, or not
taken, only with the consent or upon the authorization of the Required Lenders,
or all of the Lenders, as the case may be.
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9.6 Non-Reliance on Administrative Agent and Other Lenders.
Each Lender expressly acknowledges that neither the Administrative
Agent nor any of its officers, directors, employees, agents, attorneys-in-fact
or affiliates has made any representation or warranty to it and that no act by
the Administrative Agent hereinafter taken, including any review of the affairs
of the Credit Parties, shall be deemed to constitute any representation or
warranty by the Administrative Agent to any Lender. Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
the Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Credit Parties and made its own decision
to make its Loans hereunder and enter into this Credit Agreement. Each Lender
also represents that it will, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Credit Agreement, and to make such investigation as it deems necessary to
inform itself as to the business, operations, property, financial and other
condition and creditworthiness of the Credit Parties. Except for notices,
reports and other documents expressly required to be furnished to the Lenders by
the Administrative Agent hereunder, the Administrative Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of the Credit Parties which may
come into the possession of the Administrative Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates.
9.7 Indemnification.
The Lenders agree to indemnify the Administrative Agent in its capacity
hereunder (to the extent not reimbursed by the Credit Parties and without
limiting the obligation of the Credit Parties to do so), ratably according to
their respective Commitment Percentages in effect on the date on which
indemnification is sought under this Section, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the Notes)
be imposed on, incurred by or asserted against the Administrative Agent in any
way relating to or arising out of any Credit Document or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the
Administrative Agent under or in connection with any of the foregoing; provided,
however, that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements to the extent resulting from the Administrative
Agent's gross negligence or willful misconduct, as determined by a court of
competent jurisdiction pursuant to a final non-appealable judgment. The
agreements in this Section 9.7 shall survive the termination of this Credit
Agreement and payment of the Notes and all other amounts payable hereunder.
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9.8 Administrative Agent in Its Individual Capacity.
The Administrative Agent and its affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Borrower as
though the Administrative Agent were not the Administrative Agent hereunder.
With respect to its Loans made or renewed by it and any Note issued to it, the
Administrative Agent shall have the same rights and powers under this Credit
Agreement as any Lender and may exercise the same as though it were not the
Administrative Agent, and the terms "Lender" and "Lenders" shall include the
Administrative Agent in its individual capacity.
9.9 Successor Administrative Agent.
The Administrative Agent may resign as Administrative Agent upon 30
days' prior notice to the Borrower and the Lenders. If the Administrative Agent
shall resign as Administrative Agent under this Credit Agreement and the other
Credit Documents, then the Required Lenders shall appoint from among the Lenders
a successor agent for the Lenders, which successor agent shall be approved by
the Borrower, whereupon such successor agent shall succeed to the rights, powers
and duties of the Administrative Agent, and the term "Administrative Agent"
shall mean such successor agent effective upon such appointment and approval,
and the former Administrative Agent's rights, powers and duties as
Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Credit Agreement or any holders of the Notes. After any retiring
Administrative Agent's resignation as Administrative Agent, the provisions of
this Section 9.9 shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Administrative Agent under this Credit Agreement.
SECTION 10
MISCELLANEOUS
10.1 Amendments, Waivers and Release of Collateral.
Neither this Credit Agreement, nor any of the other Credit Documents,
nor any terms hereof or thereof may be amended, supplemented, waived or modified
except in accordance with the provisions of this Section. The Required Lenders
may, or, with the written consent of the Required Lenders, the Administrative
Agent may, from time to time, (a) enter into with the Borrower written
amendments, supplements or modifications hereto and to the other Credit
Documents for the purpose of adding any provisions to this Credit Agreement or
the other Credit Documents or changing in any manner the rights of the Lenders
or of the Borrower hereunder or thereunder or (b) waive, on such terms and
conditions as the Required Lenders may specify in such instrument, any of the
requirements of this Credit Agreement or the other Credit Documents or any
Default or Event of Default and its consequences; provided, however, that no
such waiver and no such amendment, waiver, supplement, modification or release
shall:
(i) reduce the amount or extend the scheduled date of maturity
of any Loan or Note or any installment thereon, or reduce the stated
rate of any interest or fee payable
55
hereunder (except in connection with a waiver of interest at the
increased post-default rate) or extend the scheduled date of any
payment thereof or increase the amount or extend the expiration date of
any Lender's Commitment, in each case without the written consent of
each Lender directly affected thereby; or
(ii) amend, modify or waive any provision of this Section 10.1
or reduce the percentage specified in the definition of Required
Lenders, without the written consent of all the Lenders; or
(iii) amend, modify or waive any provision of Section 9
without the written consent of the then Administrative Agent; or
(iv) release all or substantially all of the Guarantors from
their obligations under the Guaranty, without the written consent of
all of the Lenders; or
(v) amend, modify or waive any provision of the Credit
Documents requiring consent, approval or request of the Required
Lenders or all Lenders, without the written consent of all the Lenders;
provided, further, that no amendment, waiver or consent affecting the rights or
duties of the Administrative Agent under any Credit Document shall in any event
be effective, unless in writing and signed by the Administrative Agent in
addition to the Lenders required hereinabove to take such action.
Any such waiver, any such amendment, supplement or modification and any
such release shall apply equally to each of the Lenders and shall be binding
upon the Borrower, the other Credit Parties, the Lenders, the Administrative
Agent and all future holders of the Notes. In the case of any waiver, the
Borrower, the other Credit Parties, the Lenders and the Administrative Agent
shall be restored to their former position and rights hereunder and under the
outstanding Loans and Notes and other Credit Documents, subject to any
limitations contained in such waiver, and any Default or Event of Default
permanently waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to any subsequent or other Default or Event of Default, or
impair any right consequent thereon.
Notwithstanding any of the foregoing to the contrary, the consent of
the Borrower shall not be required for any amendment, modification or waiver of
the provisions of Section 9 (other than the provisions of Section 9.9);
provided, however, that the Administrative Agent will provide written notice to
the Borrower of any such amendment, modification or waiver. In addition, the
Borrower and the Lenders hereby authorize the Administrative Agent to modify
this Credit Agreement by unilaterally amending or supplementing Schedule 2.1(a)
from time to time in the manner requested by the Borrower, the Administrative
Agent or any Lender in order to reflect any assignments or transfers of the
Loans as provided for hereunder; provided further, however, that the
Administrative Agent shall promptly deliver a copy of any such modification to
the Borrower and each Lender.
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Notwithstanding the fact that the consent of all the Lenders is
required in certain circumstances as set forth above, (x) each Lender is
entitled to vote as such Lender sees fit on any bankruptcy reorganization plan
that affects the Loans, and each Lender acknowledges that the provisions of
Section 1126(c) of the Bankruptcy Code supersedes the unanimous consent
provisions set forth herein and (y) the Required Lenders may consent to allow a
Credit Party to use cash collateral in the context of a bankruptcy or insolvency
proceeding.
10.2 Notices.
All notices, requests and demands to or upon the respective parties
hereto to be effective shall be in writing (including by telecopy), and, unless
otherwise expressly provided herein, shall be deemed to have been duly given or
made (a) when delivered by hand, (b) when transmitted via telecopy (or other
facsimile device) to the number set out herein, (c) the day following the day on
which the same has been delivered prepaid (or pursuant to an invoice
arrangement) to a reputable national overnight air courier service, or (d) the
third Business Day following the day on which the same is sent by certified or
registered mail, postage prepaid, in each case addressed as follows in the case
of the Borrower, the other Credit Parties and the Administrative Agent, and as
set forth on Schedule 10.2 in the case of the Lenders, or to such other address
as may be hereafter notified by the respective parties hereto and any future
holders of the Notes:
if to the Borrower or any other Credit Party:
Xx. Xxxxxx X. Xxxxxx
Executive Vice President & Chief Financial Officer
The Dial Corporation
00000 Xxxxx Xxxx Xxxxxxxxx
Xxxxxxxxxx, Xxxxxxx 00000-0000
with a copy to:
Xx. Xxxxxxxxxxx X. Xxxxxxxxxxx
Senior Vice President and General Counsel
The Dial Corporation
00000 Xxxxx Xxxx Xxxxxxxxx
Xxxxxxxxxx, Xxxxxxx 00000-0000
Telephone: 000-000-0000
Telecopy: 000-000-0000
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if to the Administrative Agent:
First Union National Bank
Charlotte Plaza
000 Xxxxx Xxxxxxx Xxxxxx, XX-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attn: Syndication Agency Services
Telephone: 000-000-0000
Telecopy: 000-000-0000
with a copy to:
First Union National Bank
000 Xxxxx Xxxxxxx Xxxxxx, XX-0
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xx. Xxxxx Xxxx
Telephone: 000-000-0000
Telecopy: 000-000-0000
10.3 No Waiver; Cumulative Remedies.
No failure to exercise and no delay in exercising, on the part of the
Administrative Agent or any Lender, any right, remedy, power or privilege
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided are
cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.
10.4 Survival of Representations and Warranties.
All representations and warranties made hereunder and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Credit Agreement and the Notes
and the making of the Loans; provided that all such representations and
warranties shall terminate on the date upon which the Commitments have been
terminated and all Credit Party Obligations have been paid in full.
10.5 Payment of Expenses and Taxes.
The Borrower agrees (a) to pay or reimburse the Administrative Agent
and the Arranger for all their reasonable out-of-pocket costs and expenses
incurred in connection with the development, preparation, negotiation, printing
and execution of, and any amendment, supplement or modification to, this Credit
Agreement and the other Credit Documents and any other documents prepared in
connection herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, together with the reasonable fees
and disbursements of counsel to the Administrative Agent and the Arranger, (b)
to pay or reimburse each Lender and the Administrative Agent for all its costs
and expenses incurred in
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connection with the enforcement or preservation of any rights under this Credit
Agreement and the other Credit Documents, including, without limitation, the
reasonable out-of-pocket fees and disbursements of counsel to the Administrative
Agent and to the Lenders, and (c) on demand, to pay, indemnify, and hold each
Lender and the Administrative Agent harmless from, any and all recording and
filing fees and any and all liabilities with respect to, or resulting from any
delay in paying, stamp, excise and other similar taxes, if any, which may be
payable or determined to be payable in connection with the execution and
delivery of, or consummation or administration of any of the transactions
contemplated by, or any amendment, supplement or modification of, or any waiver
or consent under or in respect of, the Credit Documents and any such other
documents, and (d) to pay, indemnify, and hold each Lender and the
Administrative Agent and their Affiliates harmless from and against, any and all
other liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature whatsoever with
respect to the execution, delivery, enforcement, performance and administration
of the Credit Documents and any such other documents and the use, or proposed
use, of proceeds of the Loans (all of the foregoing, collectively, the
"indemnified liabilities"); provided, however, that the Borrower shall not have
any obligation hereunder to the Administrative Agent or any Lender with respect
to indemnified liabilities arising from the gross negligence or willful
misconduct of the Administrative Agent or any such Lender, as determined by a
court of competent jurisdiction pursuant to a final non-appealable judgment. The
agreements in this Section 10.5 shall survive repayment of the Loans, Notes and
all other Credit Party Obligations.
10.6 Successors and Assigns; Participations; Purchasing Lenders.
(a) This Credit Agreement shall be binding upon and inure to the
benefit of the Borrower, the Lenders, the Administrative Agent, all future
holders of the Notes and their respective successors and assigns, except that
the Borrower may not assign or transfer any of its rights or obligations under
this Credit Agreement or the other Credit Documents without the prior written
consent of each Lender.
(b) Any Lender may, in the ordinary course of its commercial banking
business and in accordance with applicable law, at any time sell to one or more
banks or other entities ("Participants") participating interests in any Loan
owing to such Lender, any Note held by such Lender, any Commitment of such
Lender, or any other interest of such Lender hereunder. In the event of any such
sale by a Lender of participating interests to a Participant, such Lender's
obligations under this Credit Agreement to the other parties to this Credit
Agreement shall remain unchanged, such Lender shall remain solely responsible
for the performance thereof, such Lender shall remain the holder of any such
Note for all purposes under this Credit Agreement, and the Borrower and the
Administrative Agent shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations under this Credit
Agreement. No Lender shall transfer or grant any participation under which the
Participant shall have rights to approve any amendment to or waiver of this
Credit Agreement or any other Credit Document except to the extent such
amendment or waiver would (i) extend the scheduled maturity of any Loan or Note
or any installment thereon in which such Participant is participating, or reduce
the stated rate or extend the time of payment of interest or fees thereon
(except in connection with a waiver of interest at the increased post-default
rate) or reduce the
59
principal amount thereof, or increase the amount of the Participant's
participation over the amount thereof then in effect (it being understood that a
waiver of any Default or Event of Default shall not constitute a change in the
terms of such participation, and that an increase in any Commitment or Loan
shall be permitted without consent of any Participant if the Participant's
participation is not increased as a result thereof), (ii) release all or
substantially all of the Guarantors from their obligations under the Guaranty,
or (iii) consent to the assignment or transfer by the Borrower of any of its
rights and obligations under this Credit Agreement. In the case of any such
participation, the Participant shall not have any rights under this Credit
Agreement or any of the other Credit Documents (the Participant's rights against
such Lender in respect of such participation to be those set forth in the
agreement executed by such Lender in favor of the Participant relating thereto)
and all amounts payable by the Borrower hereunder shall be determined as if such
Lender had not sold such participation; provided that each Participant shall be
entitled to the benefits of Sections 3.10, 3.11, 3.12 and 10.5 with respect to
its participation in the Commitments and the Loans outstanding from time to
time; provided further, that no Participant shall be entitled to receive any
greater amount pursuant to such Sections than the transferor Lender would have
been entitled to receive in respect of the amount of the participation
transferred by such transferor Lender to such Participant had no such transfer
occurred.
(c) Any Lender may, in the ordinary course of its commercial banking
business and in accordance with applicable law, at any time, sell or assign to
any Lender or any Affiliate or Related Fund thereof and, with the consent of the
Administrative Agent and, so long as no Event of Default has occurred and is
continuing, the Borrower (in each case, which consent shall not be unreasonably
withheld), to one or more additional banks or financial institutions or entities
("Purchasing Lenders"), all or any part of its rights and obligations under this
Credit Agreement and the Notes in minimum amounts of $5,000,000 with respect to
its Commitment and Loans (or, if less, the entire amount of such Lender's
obligations), pursuant to a Commitment Transfer Supplement, executed by such
Purchasing Lender and such transferor Lender (and, to the extent required above,
the Administrative Agent and the Borrower), and delivered to the Administrative
Agent for its acceptance and recording in the Register; provided, however, that
any sale or assignment to an existing Lender shall not require the consent of
the Administrative Agent or the Borrower nor shall any such sale or assignment
be subject to the minimum assignment amounts specified herein. Upon such
execution, delivery, acceptance and recording, from and after the Transfer
Effective Date specified in such Commitment Transfer Supplement, (x) the
Purchasing Lender thereunder shall be a party hereto and, to the extent provided
in such Commitment Transfer Supplement, have the rights and obligations of a
Lender hereunder with a Commitment as set forth therein, and (y) the transferor
Lender thereunder shall, to the extent provided in such Commitment Transfer
Supplement, be released from its obligations under this Credit Agreement (and,
in the case of a Commitment Transfer Supplement covering all or the remaining
portion of a transferor Lender's rights and obligations under this Credit
Agreement, such transferor Lender shall cease to be a party hereto; provided,
however, that such Lender shall still be entitled to any indemnification rights
hereunder). Such Commitment Transfer Supplement shall be deemed to amend this
Credit Agreement to the extent, and only to the extent, necessary to reflect the
addition of such Purchasing Lender and the resulting adjustment of Commitment
Percentages arising from the purchase by such Purchasing Lender of all or a
portion of the rights and obligations of such transferor Lender under this
Credit Agreement and the Notes. On or prior to
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the Transfer Effective Date specified in such Commitment Transfer Supplement,
the Borrower shall execute and deliver to the Administrative Agent in exchange
for the Notes delivered to the Administrative Agent pursuant to such Commitment
Transfer Supplement new Notes to the order of such Purchasing Lender in an
amount equal to the Commitment assumed by it pursuant to such Commitment
Transfer Supplement and, unless the transferor Lender has not retained a
Commitment hereunder, new Notes to the order of the transferor Lender in an
amount equal to the Commitment retained by it hereunder. Such new Notes shall be
dated the Closing Date and shall otherwise be in the form of the Notes replaced
thereby. The Notes surrendered by the transferor Lender shall be returned by the
Administrative Agent to the Borrower marked "canceled".
(d) The Administrative Agent shall maintain at its address referred to
in Section 10.2 a copy of each Commitment Transfer Supplement delivered to it
and a register (the "Register") for the recordation of the names and addresses
of the Lenders and the Commitment of, and principal amount of the Loans owing
to, each Lender from time to time. The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register as the owner of the Loan recorded therein for all
purposes of this Credit Agreement. The Register shall be available for
inspection by the Borrower or any Lender at any reasonable time and from time to
time upon reasonable prior notice.
(e) Upon its receipt of a duly executed Commitment Transfer Supplement,
together with payment to the Administrative Agent by the transferor Lender or
the Purchasing Lender, as agreed between them, of a registration and processing
fee of $3,500.00 for each Purchasing Lender listed in such Commitment Transfer
Supplement and the Notes subject to such Commitment Transfer Supplement, the
Administrative Agent shall (i) accept such Commitment Transfer Supplement, (ii)
record the information contained therein in the Register and (iii) give prompt
notice of such acceptance and recordation to the Lenders and the Borrower.
(f) The Borrower authorizes each Lender to disclose to any Participant
or Purchasing Lender (each, a "Transferee") and any prospective Transferee any
and all financial information in such Lender's possession concerning the
Borrower and its Affiliates which has been delivered to such Lender by or on
behalf of the Borrower pursuant to this Credit Agreement or which has been
delivered to such Lender by or on behalf of the Borrower in connection with such
Lender's credit evaluation of the Borrower and its Subsidiaries prior to
becoming a party to this Credit Agreement, in each case subject to Section
10.16.
(g) At the time of each assignment pursuant to this Section 10.6 to a
Person which is not already a Lender hereunder and which is not a United States
person (as such term is defined in Section 7701(a)(30) of the Code) for Federal
income tax purposes, the respective assignee Lender shall provide to the
Borrower and the Administrative Agent the appropriate Internal Revenue Service
Forms (and, if applicable, a 3.13 Certificate) described in Section 3.13.
(h) Nothing herein shall prohibit any Lender from pledging or assigning
any of its rights under this Credit Agreement (including, without limitation,
any right to payment of
61
principal and interest under any Note) to any Federal Reserve Bank in accordance
with applicable laws.
10.7 Adjustments; Set-off.
(a) Each Lender agrees that if any Lender (a "benefited Lender") shall
at any time receive any payment of all or part of its Loans, or interest
thereon, or receive any collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, pursuant to events or proceedings of the nature
referred to in Section 8.1(e), or otherwise) in a greater proportion than any
such payment to or collateral received by any other Lender, if any, in respect
of such other Lender's Loans, or interest thereon, such benefited Lender shall
purchase for cash from the other Lenders a participating interest in such
portion of each such other Lender's Loan, or shall provide such other Lenders
with the benefits of any such collateral, or the proceeds thereof, as shall be
necessary to cause such benefited Lender to share the excess payment or benefits
of such collateral or proceeds ratably with each of the Lenders; provided,
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such benefited Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest. The Borrower agrees that each Lender so
purchasing a portion of another Lender's Loans may exercise all rights of
payment (including, without limitation, rights of set-off) with respect to such
portion as fully as if such Lender were the direct holder of such portion.
(b) In addition to any rights and remedies of the Lenders provided by
law (including, without limitation, other rights of set-off), each Lender shall
have the right, without prior notice to any Credit Party, any such notice being
expressly waived by the Credit Parties to the extent permitted by applicable
law, upon the occurrence of any Event of Default, to setoff and appropriate and
apply any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by such Lender or any branch or
agency thereof to or for the credit or the account of any Credit Party, or any
part thereof in such amounts as such Lender may elect, against and on account of
the obligations and liabilities of the Borrower and the other Credit Parties to
such Lender hereunder and claims of every nature and description of such Lender
against the Borrower and the other Credit Parties, in any currency, whether
arising hereunder, under the Notes or under any documents contemplated by or
referred to herein or therein, as such Lender may elect, whether or not such
Lender has made any demand for payment and although such obligations,
liabilities and claims may be contingent or unmatured. The aforesaid right of
set-off may be exercised by such Lender against any Credit Party or against any
trustee in bankruptcy, debtor in possession, assignee for the benefit of
creditors, receiver or execution, judgment or attachment creditor of any such
Credit Party, or against anyone else claiming through or against any such Credit
Party or any such trustee in bankruptcy, debtor in possession, assignee for the
benefit of creditors, receiver, or execution, judgment or attachment creditor,
notwithstanding the fact that such right of set-off shall not have been
exercised by such Lender prior to the occurrence of any Event of Default. Each
Lender agrees promptly to notify the applicable Credit Party and the
Administrative Agent after any such set-off and application made by such Lender;
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provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application.
10.8 Table of Contents and Section Headings.
The table of contents and the Section and subsection headings herein
are intended for convenience only and shall be ignored in construing this Credit
Agreement.
10.9 Counterparts.
This Credit Agreement may be executed by one or more of the parties to
this Credit Agreement on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
agreement.
10.10 Effectiveness.
This Credit Agreement shall become effective on the date on which all
of the parties have signed a copy hereof (whether the same or different copies)
and shall have delivered the same to the Administrative Agent (or counsel to the
Administrative Agent) or, in the case of the Lenders, shall have given to the
Administrative Agent written, telecopied or telex notice (actually received) at
such office that the same has been signed and mailed to it.
10.11 Severability.
Any provision of this Credit Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
10.12 Integration.
This Credit Agreement and the other Credit Documents represent the
agreement of the Borrower, the Administrative Agent and the Lenders with respect
to the subject matter hereof, and there are no promises, undertakings,
representations or warranties by the Administrative Agent, the Borrower or any
Lender relative to the subject matter hereof not expressly set forth or referred
to herein or in the other Credit Documents.
10.13 Governing Law.
This Credit Agreement and the other Credit Documents and the rights and
obligations of the parties under this Credit Agreement and the other Credit
Documents shall be governed by, and construed and interpreted in accordance
with, the law of the State of North Carolina.
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10.14 Consent to Jurisdiction and Service of Process.
All judicial proceedings brought against the Borrower and/or any other
Credit Party with respect to this Credit Agreement, any Note or any of the other
Credit Documents may be brought in any state or federal court of competent
jurisdiction in the State of North Carolina, and, by execution and delivery of
this Credit Agreement, each of the Borrower and the other Credit Parties
accepts, for itself and in connection with its properties, generally and
unconditionally, the non-exclusive jurisdiction of the aforesaid courts and
irrevocably agrees to be bound by any final judgment rendered thereby in
connection with this Credit Agreement, any Note or any other Credit Document
from which no appeal has been taken or is available. Each of the Borrower and
the other Credit Parties irrevocably agrees that all service of process in any
such proceedings in any such court may be effected by mailing a copy thereof by
registered or certified mail (or any substantially similar form of mail),
postage prepaid, to it at its address set forth in Section 10.2 or at such other
address of which the Administrative Agent shall have been notified pursuant
thereto, such service being hereby acknowledged by the each of the Borrower and
the other Credit Parties to be effective and binding service in every respect.
Each of the Borrower, the other Credit Parties, the Administrative Agent and the
Lenders irrevocably waives any objection, including, without limitation, any
objection to the laying of venue based on the grounds of forum non conveniens
which it may now or hereafter have to the bringing of any such action or
proceeding in any such jurisdiction. Nothing herein shall affect the right to
serve process in any other manner permitted by law or shall limit the right of
any Lender to bring proceedings against the Borrower or the other Credit Parties
in the court of any other jurisdiction.
10.15 Arbitration.
(a) Notwithstanding the provisions of Section 10.14 to the contrary,
upon demand of any party hereto, whether made before or within three (3) months
after institution of any judicial proceeding, any dispute, claim or controversy
arising out of, connected with or relating to this Credit Agreement and other
Credit Documents ("Disputes") between or among parties to this Credit Agreement
shall be resolved by binding arbitration as provided herein. Institution of a
judicial proceeding by a party does not waive the right of that party to demand
arbitration hereunder. Disputes may include, without limitation, tort claims,
counterclaims, disputes as to whether a matter is subject to arbitration, claims
brought as class actions, claims arising from Credit Documents executed in the
future, or claims arising out of or connected with the transaction reflected by
this Credit Agreement.
Arbitration shall be conducted under and governed by the Commercial
Arbitration Rules (the "Arbitration Rules") of the American Arbitration
Association (the "AAA") and Title 9 of the U.S. Code. All arbitration hearings
shall be conducted in New York, New York. A hearing shall begin within 90 days
of demand for arbitration and all hearings shall be concluded within 120 days of
demand for arbitration. These time limitations may not be extended unless a
party shows cause for extension and then no more than a total extension of 60
days. The expedited procedures set forth in Rule 51 et seq. of the Arbitration
Rules shall be applicable to claims of less than $1,000,000. All applicable
statutes of limitation shall apply to any Dispute. A judgment upon the award may
be entered in any court having jurisdiction. Arbitrators shall be licensed
attorneys selected from the Commercial Financial Dispute Arbitration Panel of
the
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AAA. The parties hereto do not waive applicable Federal or state substantive law
except as provided herein.
(b) Notwithstanding the preceding binding arbitration provisions, the
Administrative Agent, the Lenders, the Borrower and the other Credit Parties
agree to preserve, without diminution, certain remedies that the Administrative
Agent on behalf of the Lenders may employ or exercise freely, independently or
in connection with an arbitration proceeding or after an arbitration action is
brought. The Administrative Agent on behalf of the Lenders shall have the right
to proceed in any court of proper jurisdiction or by self-help to exercise or
prosecute the following remedies, as applicable (i) obtaining provisional or
ancillary remedies including injunctive relief, sequestration, garnishment,
attachment, appointment of receiver and filing an involuntary bankruptcy
proceeding; and (ii) when applicable, a judgment by confession of judgment.
Preservation of these remedies does not limit the power of an arbitrator to
grant similar remedies that may be requested by a party in a Dispute.
(c) The parties hereto agree that they shall not have a remedy of
punitive or exemplary damages against the other in any Dispute and hereby waive
any right or claim to punitive or exemplary damages they have now or which may
arise in the future in connection with any Dispute whether the Dispute is
resolved by arbitration or judicially.
(d) By execution and delivery of this Credit Agreement, each of the
parties hereto accepts, for itself and in connection with its properties,
generally and unconditionally, the non-exclusive jurisdiction relating to any
arbitration proceedings conducted under the Arbitration Rules in New York, New
York and irrevocably agrees to be bound by any final judgment rendered thereby
in connection with this Credit Agreement from which no appeal has been taken or
is available.
10.16 Confidentiality.
The Administrative Agent and each of the Lenders agrees that it shall
not disclose without the prior consent of the Borrower (other than to its
employees, affiliates, auditors or counsel or to another Lender) any information
with respect to the Borrower and its Subsidiaries which is furnished pursuant to
this Credit Agreement, any other Credit Document or any documents contemplated
by or referred to herein or therein and which is designated by the Borrower to
the Lenders in writing as confidential or as to which it is otherwise reasonably
clear such information is not public, except that any Lender may disclose any
such information (a) as has become generally available to the public other than
by a breach of this Section 10.16, (b) as may be required in any report,
statement or testimony submitted to any municipal, state or federal regulatory
body having or claiming to have jurisdiction over such Lender or to the Federal
Reserve Board or the Federal Deposit Insurance Corporation or the OCC or the
NAIC or similar organizations (whether in the United States or elsewhere) or
their successors, (c) as may be required in response to any summons or subpoena
or any law, order, regulation or ruling applicable to such Lender, (d) to any
prospective Participant or assignee in connection with any contemplated transfer
pursuant to Section 10.6; provided that such prospective transferee shall have
been made aware of this Section 10.16 and has agreed to be bound thereby or (e)
to Gold Sheets and other similar bank trade publications, such information to
consist of deal terms and
65
other information regarding the credit facilities evidenced by this Credit
Agreement customarily found in such publications.
10.17 Acknowledgments.
The Borrower and the other Credit Parties each hereby acknowledges
that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of each Credit Document;
(b) neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to the Borrower or any other Credit Party arising out
of or in connection with this Credit Agreement and the relationship between
Administrative Agent and Lenders, on one hand, and the Borrower and the other
Credit Parties, on the other hand, in connection herewith is solely that of
debtor and creditor; and
(c) no joint venture exists among the Lenders or among the Borrower or
the other Credit Parties and the Lenders.
10.18 Waivers of Jury Trial.
THE BORROWER, THE OTHER CREDIT PARTIES, THE ADMINISTRATIVE AGENT AND
THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING
RELATING TO THIS CREDIT AGREEMENT OR ANY OTHER CREDIT DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.
SECTION 11
GUARANTY
11.1 The Guaranty.
In order to induce the Lenders to enter into this Credit Agreement and
to extend credit hereunder and in recognition of the direct benefits to be
received by the Guarantors from the Extensions of Credit hereunder, each of the
Guarantors hereby agrees with the Administrative Agent and the Lenders as
follows: the Guarantor hereby unconditionally and irrevocably jointly and
severally guarantees as primary obligor and not merely as surety the full and
prompt payment when due, whether upon maturity, by acceleration or otherwise, of
any and all Credit Party Obligations. If any or all of the Credit Party
Obligations becomes due and payable hereunder, each Guarantor unconditionally
promises to pay such Credit Party Obligations to the Administrative Agent and
the Lenders, or order, or demand, together with any and all reasonable expenses
which may be incurred by the Administrative Agent or the Lenders in collecting
any of the Credit Party Obligations.
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Notwithstanding any provision to the contrary contained herein or in
any other of the Credit Documents, to the extent the obligations of a Guarantor
shall be adjudicated to be invalid or unenforceable for any reason (including,
without limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers) then the obligations of each such Guarantor
hereunder shall be limited to the maximum amount that is permissible under
applicable law (whether federal or state and including, without limitation, the
Bankruptcy Code).
11.2 Bankruptcy.
Additionally, each of the Guarantors unconditionally and irrevocably
guarantees jointly and severally the payment of any and all Credit Party
Obligations of the Borrower to the Lenders whether or not due or payable by the
Borrower upon the occurrence of any of the events specified in Section 8.1(e),
and unconditionally promises to pay such Credit Party Obligations to the
Administrative Agent for the account of the Lenders, or order, on demand, in
lawful money of the United States. Each of the Guarantors further agrees that to
the extent that the Borrower or a Guarantor shall make a payment or a transfer
of an interest in any property to the Administrative Agent or any Lender, which
payment or transfer or any part thereof is subsequently invalidated, declared to
be fraudulent or preferential, or otherwise is avoided, and/or required to be
repaid to the Borrower or a Guarantor, the estate of the Borrower or a
Guarantor, a trustee, receiver or any other party under any bankruptcy law,
state or federal law, common law or equitable cause, then to the extent of such
avoidance or repayment, the obligation or part thereof intended to be satisfied
shall be revived and continued in full force and effect as if said payment had
not been made.
11.3 Nature of Liability.
The liability of each Guarantor hereunder is exclusive and independent
of any security for or other guaranty of the Credit Party Obligations of the
Borrower whether executed by any such Guarantor, any other guarantor or by any
other party, and no Guarantor's liability hereunder shall be affected or
impaired by (a) any direction as to application of payment by the Borrower or by
any other party, or (b) any other continuing or other guaranty, undertaking or
maximum liability of a guarantor or of any other party as to the Credit Party
Obligations of the Borrower, or (c) any payment on or in reduction of any such
other guaranty or undertaking, or (d) any dissolution, termination or increase,
decrease or change in personnel by the Borrower, or (e) any payment made to the
Administrative Agent or the Lenders on the Credit Party Obligations which the
Administrative Agent or such Lenders repay the Borrower pursuant to court order
in any bankruptcy, reorganization, arrangement, moratorium or other debtor
relief proceeding, and each of the Guarantors waives any right to the deferral
or modification of its obligations hereunder by reason of any such proceeding.
11.4 Independent Obligation.
The obligations of each Guarantor hereunder are independent of the
obligations of any other guarantor or the Borrower, and a separate action or
actions may be brought and prosecuted against each Guarantor whether or not
action is brought against any other guarantor or the
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Borrower and whether or not any other Guarantor or the Borrower is joined in any
such action or actions.
11.5 Authorization.
Each of the Guarantors authorizes the Administrative Agent and each
Lender without notice or demand (except as shall be required by applicable
statute and cannot be waived), and without affecting or impairing its liability
hereunder, from time to time to (a) renew, compromise, extend, increase,
accelerate or otherwise change the time for payment of, or otherwise change the
terms of the Credit Party Obligations or any part thereof in accordance with
this Credit Agreement, including any increase or decrease of the rate of
interest thereon, (b) take and hold security from any guarantor or any other
party for the payment of this Guaranty or the Credit Party Obligations and
exchange, enforce waive and release any such security, (c) apply such security
and direct the order or manner of sale thereof as the Administrative Agent and
the Lenders in their discretion may determine and (d) release or substitute any
one or more endorsers, guarantors, the Borrower or other obligors.
11.6 Reliance.
It is not necessary for the Administrative Agent or the Lenders to
inquire into the capacity or powers of the Borrower or the officers, directors,
members, partners or agents acting or purporting to act on its behalf, and any
indebtedness made or created in reliance upon the professed exercise of such
powers shall be guaranteed hereunder.
11.7 Waiver.
(a) Each of the Guarantors waives any right (except as shall be
required by applicable statute and cannot be waived) to require the
Administrative Agent or any Lender to (i) proceed against the Borrower, any
other guarantor or any other party, (ii) proceed against or exhaust any security
held from the Borrower, any other guarantor or any other party, or (iii) pursue
any other remedy in the Administrative Agent's or any Lender's power whatsoever.
Each of the Guarantors waives any defense based on or arising out of any defense
of the Borrower, any other guarantor or any other party other than payment in
full of the Credit Party Obligations, including without limitation any defense
based on or arising out of the disability of the Borrower, any other guarantor
or any other party, or the unenforceability of the Credit Party Obligations or
any part thereof from any cause, or the cessation from any cause of the
liability of the Borrower other than payment in full of the Credit Party
Obligations. The Administrative Agent or any of the Lenders may, at their
election, foreclose on any security held by the Administrative Agent or a Lender
by one or more judicial or nonjudicial sales, whether or not every aspect of any
such sale is commercially reasonable (to the extent such sale is permitted by
applicable law), or exercise any other right or remedy the Administrative Agent
and any Lender may have against the Borrower or any other party, or any
security, without affecting or impairing in any way the liability of any
Guarantor hereunder except to the extent the Credit Party Obligations have been
paid in full. Each of the Guarantors waives any defense arising out of any such
election by the Administrative Agent and each of the Lenders, even though such
election operates to impair or
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extinguish any right of reimbursement or subrogation or other right or remedy of
the Guarantors against the Borrower or any other party or any security.
(b) Each of the Guarantors waives all presentments, demands for
performance, protests and notices, including without limitation notices of
nonperformance, notice of protest, notices of dishonor, notices of acceptance of
this Guaranty, and notices of the existence, creation or incurring of new or
additional Credit Party Obligations. Each Guarantor assumes all responsibility
for being and keeping itself informed of the Borrower's financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the Credit Party Obligations and the nature, scope and extent of the risks which
such Guarantor assumes and incurs hereunder, and agrees that neither the
Administrative Agent nor any Lender shall have any duty to advise such Guarantor
of information known to it regarding such circumstances or risks.
(c) Each of the Guarantors hereby agrees it will not exercise any
rights of subrogation which it may at any time otherwise have as a result of
this Guaranty (whether contractual, under Section 509 of the U.S. Bankruptcy
Code, or otherwise) to the claims of the Lenders against the Borrower or any
other guarantor of the Credit Party Obligations of the Borrower owing to the
Lenders (collectively, the "Other Parties") and all contractual, statutory or
common law rights of reimbursement, contribution or indemnity from any Other
Party which it may at any time otherwise have as a result of this Guaranty until
such time as the Credit Party Obligations shall have been paid in full and the
Commitments have been terminated. Each of the Guarantors hereby further agrees
not to exercise any right to enforce any other remedy which the Administrative
Agent and the Lenders now have or may hereafter have against any Other Party,
any endorser or any other guarantor of all or any part of the Credit Party
Obligations of the Borrower and any benefit of, and any right to participate in,
any security or collateral given to or for the benefit of the Lenders to secure
payment of the Credit Party Obligations of the Borrower until such time as the
Credit Party Obligations shall have been paid in full and the Commitments have
been terminated.
11.8 Limitation on Enforcement.
The Lenders agree that this Guaranty may be enforced only by the action
of the Administrative Agent acting upon the instructions of the Required Lenders
and that no Lender shall have any right individually to seek to enforce or to
enforce this Guaranty, it being understood and agreed that such rights and
remedies may be exercised by the Administrative Agent for the benefit of the
Lenders under the terms of this Credit Agreement. The Lenders further agree that
this Guaranty may not be enforced against any director, officer, employee or
stockholder of the Guarantors.
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11.9 Confirmation of Payment.
The Administrative Agent and the Lenders will, upon request after
payment of the Credit Party Obligations which are the subject of this Guaranty
and termination of the Commitments relating thereto, confirm to the Borrower,
the Guarantors or any other Person that the Credit Party Obligations have been
paid in full and the Commitments relating thereto terminated, subject to the
provisions of Section 11.2.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Credit Agreement to be duly executed and delivered as of the date first
above written.
BORROWER: THE DIAL CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President
& Chief Financial Officer
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Senior Vice President & Treasurer
GUARANTORS: DIAL BRANDS, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Treasurer & Controller
DIAL BRANDS HOLDING, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Treasurer & Controller
DIAL INTERNATIONAL, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President & Treasurer
[Signature Pages Continue]
GUARANTORS cont.: DIAL BENEFITS MANAGEMENT
CORPORATION
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Treasurer
DIAL POST-RETIREMENT LIABILITIES
MANAGEMENT COMPANY
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President & Treasurer
[Signature Pages Continue]
LENDERS: FIRST UNION NATIONAL BANK,
individually in its capacity as a
Lender and in its capacity as Administrative
Agent
By: /s/ Xxx Xxxxxxx
-----------------------------------------
Name: Xxx Xxxxxxx
Title: Director
BANK OF AMERICA, N.A.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Managing Director
BANK ONE, NA
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Director
CREDIT LYONNAIS LOS ANGELES BRANCH
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President and Manager
