LOAN AND SECURITY AGREEMENT
Dated as of December 18, 1997
SYNTHETIC INDUSTRIES, INC., a Delaware corporation, the financial
institutions party to this Agreement from time to time and BANKBOSTON, N.A., a
national banking association, as agent for the Lenders, agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.1 Definitions. For the purposes of this Agreement:
Account Debtor means a Person who is obligated on a Receivable.
Acquire or Acquisition, as applied to any Business Unit or Investment,
means the acquiring or acquisition of such Business Unit or Investment by
purchase, exchange, issuance of stock or other securities, or by merger,
reorganization or any other method.
Adjusted Eurodollar Rate, as applicable to any Interest Period, means a
rate per annum determined pursuant to the following formula, rounded upwards, if
necessary, to the next higher 1/16th of 1%:
Adjusted Eurodollar Rate = Interbank Offered Rate
1-Reserve Percentage
Where:
Interbank Offered Rate applicable to any Eurodollar Rate Loan
for any Interest Period means the rate of interest determined by the
Agent to be the prevailing rate per annum at which deposits in U.S.
Dollars are offered to the Agent by first-class banks in the interbank
Eurodollar market in which it regularly participates on or about 10:00
a.m. two Business Days before the first day of such Interest Period in
an amount approximately equal to the principal amount of the Eurodollar
Rate Loan to which such Interest Period is to apply for a period
approximately equal to such Interest Period.
and
Reserve Percentage applicable to any Interest Period means the
rate (expressed as a decimal) applicable to United States commercial
banks during such Interest Period under regulations issued from time to
time by the Board of Governors of the Federal Reserve System for
determining the maximum reserve requirement (including, without
limitation, any basic, supplemental, emergency or marginal reserve
requirement) of such banks with respect to "Eurocurrency liabilities"
as that term is defined under such regulations. Without limiting the
effect of the foregoing, the Reserve Percentage shall include any other
reserves required to be maintained by such banks by reason of any
regulatory change with respect to (i) any category of liabilities that
includes deposits by reference to which the "Interbank Offered Rate" is
to be determined as provided in the definition of "Interbank Offered
Rate" above or (ii) any category of extensions of credit or other
assets that includes Eurodollar Rate Loans.
The Adjusted Eurodollar Rate shall be adjusted automatically as of the effective
date of any change in the Reserve Percentage.
Affiliate means, with respect to a Person, (a) any partner, officer,
shareholder (if holding more than ten percent (10%) of the outstanding shares of
capital stock of such Person), director, employee or managing agent of such
Person, (b) any spouse, parents, siblings, children or grandchildren of such
Person, and (c) any other Person (other than a Subsidiary), (i) that directly or
indirectly through one or more intermediaries, controls, or is controlled by, or
is under common control with, such given Person, (ii) that directly or
indirectly beneficially owns or holds ten percent (10%) or more of any class of
voting stock or partnership or other voting interest of such Person or any
Subsidiary of such Person, or (iii) ten percent (10%) or more of the voting
stock or partnership or other voting interest of which is directly or indirectly
beneficially owned or held by such Person or a Subsidiary of such Person. The
term "control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through ownership of voting securities or partnership or other voting
interest, by contract or otherwise. Each of SI Management, Synthetic Management
and Synthetic L.P. shall be deemed to be an Affiliate of the Borrower.
Agent means BankBoston, N.A., a national banking association, and
any successor agent appointed pursuant to Section 15.9 hereof.
Agent's Office means the office of the Agent specified in or determined
in accordance with the provisions of Section 16.1.
Agreement means and includes this Agreement, including all Schedules,
Exhibits and other attachments hereto, and all amendments, modifications and
supplements hereto and thereto.
Agreement Date means the date as of which this Agreement is dated.
Applicable Law means all applicable provisions of constitutions,
statutes, rules, regulations and orders of all governmental bodies and of all
orders and decrees of all courts and arbitrators, including, without limitation,
Environmental Laws.
Applicable Margin means (a) as to Base Rate Loans at all times, 0%, and
(b) as to Eurodollar Rate Loans (i) from the Effective Date to the first Margin
Adjustment Date, 1.5% and (ii) thereafter, the applicable percentage reflected
on the pricing matrix attached hereto as Annex B, provided that the Applicable
Margin shall not be less than 1.25% at any time when Pricing Coverage for the
most recently ended period of four consecutive fiscal quarters of the Borrower
is less than 1.1 to 1.
Asset Disposition means the disposition of any asset of the Borrower or
any of its Subsidiaries, other than sales of Inventory in the ordinary course of
business.
Assignment and Acceptance means an assignment and acceptance in the
form attached hereto as Exhibit D assigning all or a portion of a Lender's
interests, rights and obligations under this Agreement pursuant to Section 14.1.
Authorized Officer means each of the officers of the Borrower
authorized to execute and deliver Loan Documents and to request Borrowings, as
identified in the certificate furnished pursuant to Section 6.1(a)(4) or from
time to time after the Effective Date pursuant to authorizations in form and
substance satisfactory to the Agent.
BSI means BancBoston Securities Inc., a Delaware corporation and an
Affiliate of BankBoston.
BankBoston means BankBoston, N.A. (formerly The First National Bank of
Boston), a national banking association, in its individual capacity and not as
the Agent hereunder.
Base Rate means at any time an interest rate per annum equal to the
greater of (i) the rate of interest publicly announced from time to time by
BankBoston at its head office at 000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx as
its "base" rate as in effect at such time, and (ii) the Federal Funds Effective
Rate plus 1/2 of 1% per annum (rounded upward, if necessary, to the next higher
1/8th of 1%).
Base Rate Loan means each Borrowing of Base Rate Loans under the
Revolving Credit Facility on the same day and any specified principal amount of
Base Rate Loans outstanding under the Revolving Credit Facility.
Benefit Plan means an "employee pension benefit plan" as defined in
Section 3(3) of ERISA (other than a Multiemployer Plan) in respect of which the
Borrower or any Related Company is, or within the immediately preceding six
years was, an "employer" as defined in Section 3(5) of ERISA, including such
plans as may be established after the Agreement Date.
Borrower means Synthetic Industries, Inc., a Delaware corporation.
Borrower RPA means the Receivables Purchase and Sale Agreement dated as
of December 18, 1997 between the Borrower as seller and as "Collection Agent"
and Funding as purchaser.
Borrowing means the borrowing of a group of Loans of a single Type made
by all Lenders on a single date and, in the case of Eurodollar Rate Loans,
having a single Interest Period and includes the continuation or conversion of
an existing Loan or Loans in whole or in part.
Business Day means any day other than a Saturday, Sunday or other day
on which banks in Boston, Massachusetts, New York, New York or Atlanta, Georgia
are authorized to close and, when used with respect to Eurodollar Rate Loans,
means any such day on which dealings are also carried on in the applicable
interbank Eurodollar market.
Business Unit means the assets constituting the business or a division
or operating unit thereof of any Person.
Capital Expenditures means, with respect to any Person, all
expenditures made and liabilities incurred for the acquisition of assets (other
than assets which constitute a Business Unit or Inventory) which are not, in
accordance with GAAP, treated as expense items for such Person in the year made
or incurred or as a prepaid expense applicable to a future year or years (but
excluding capitalized interest incurred in connection therewith).
Capitalized Lease means a lease that is required to be capitalized for
financial reporting purposes in accordance with GAAP.
Capitalized Lease Obligation means Indebtedness represented by
obligations under a Capitalized Lease, and the amount of such Indebtedness shall
be the capitalized amount of such obligations determined in accordance with
GAAP.
Cash Collateral means collateral consisting of cash or Cash Equivalents
on which the Agent, for the benefit of itself as Agent and the Lenders, has a
first priority Lien.
Cash Collateral Account means a special interest-bearing deposit
account consisting of cash maintained at the principal office of the Agent and
under the sole dominion and control of the Agent, for its benefit and for the
benefit of the Lenders, established pursuant to the provisions of Section 5.16
for purposes set forth therein.
Cash Equivalents means
(a) marketable direct obligations issued or unconditionally guaranteed
by the United States Government or issued by any agency thereof and backed by
the full faith and credit of the United States, in each case maturing within one
year from the date of acquisition thereof;
(b) commercial paper maturing no more than one year from the date
issued and, at the time of acquisition thereof, having a rating of at least A-1
from S&P or at least P-1 from Xxxxx'x;
(c) certificates of deposit or bankers' acceptances issued in Dollar
denominations and maturing within one year from the date of issuance thereof
issued by any commercial bank organized under the laws of the United States of
America or any state thereof or the District of Columbia having combined capital
and surplus of not less than $250,000,000 and, unless issued by the Agent or a
Lender, not subject to set-off or offset rights in favor of such bank arising
from any banking relationship with such bank; and
(d) repurchase agreements in form and substance and for amounts
satisfactory to the Agent.
Code means the Internal Revenue Code of 1986, as amended from time to
time.
Collateral means and includes all of the Borrower's right, title and
interest in and to each of the following, wherever located and whether now or
hereafter existing or now owned or hereafter acquired or arising:
(a) (i) all rights to the payment of money or other forms of
consideration of any kind (whether classified under the UCC as accounts,
contract rights, chattel paper, general intangibles or otherwise) including, but
not limited to, accounts receivable, letters of credit and the right to receive
payment thereunder, chattel paper, tax refunds, insurance proceeds, any rights
under contracts not yet earned by performance and not evidenced by an instrument
or chattel paper, notes, drafts, instruments, documents, acceptances and all
other debts, obligations and liabilities in whatever form from any Person, (ii)
all guaranties, security and Liens securing payment thereof, (iii) all goods,
whether now owned or hereafter acquired, and whether sold, delivered,
undelivered, in transit or returned, which may be represented by, or the sale or
lease of which may have given rise to, any such right to payment or other debt,
obligation or liability, and (iv) all proceeds of any of the foregoing (the
foregoing, collectively, Receivables),
(b) (i) all inventory, (ii) all goods intended for sale or lease or for
display or demonstration, (iii) all work in process, (iv) all raw materials and
other materials and supplies of every nature and description used or which might
be used in connection with the manufacture, packing, shipping, advertising,
selling, leasing or furnishing of goods or services or otherwise used or
consumed in the conduct of business, and (v) all documents evidencing and
general intangibles relating to any of the foregoing (the foregoing,
collectively, Inventory),
(c) (i) all machinery, apparatus, equipment, motor vehicles, tractors,
trailers, rolling stock, fittings, fixtures and other tangible personal property
(other than Inventory) of every kind and description, (ii) all tangible personal
property (other than Inventory) and fixtures used in the Borrower's business
operations or owned by the Borrower or in which the Borrower has an interest,
and (iii) all parts, accessories and special tools and all increases and
accessions thereto and substitutions and replacements therefor (the foregoing,
collectively, Equipment),
(d) all general intangibles, choses in action and causes of action and
all other intangible personal property of every kind and nature (other than
Receivables), including, without limitation, Proprietary Rights, corporate or
other business records, inventions, designs, blueprints, plans, specifications,
trade secrets, goodwill, computer software, customer lists, registrations,
licenses, franchises, tax refund claims, reversions or any rights thereto and
any other amounts payable to such Person from any Benefit Plan, Multiemployer
Plan or other employee benefit plan, rights and claims against carriers and
shippers, rights to indemnification, business interruption insurance and
proceeds thereof, property, casualty or any similar type of insurance and any
proceeds thereof, the beneficiary's interest in proceeds of insurance covering
the lives of key employees and any letter of credit, guarantee, claims, security
interest or other security for the payment by an Account Debtor of any of the
Receivables (the foregoing, collectively, General Intangibles),
(e) any demand, time, savings, passbook, money market or like
depository account, and all certificates of deposit, maintained with a bank,
savings and loan association, credit union or like organization, other than an
account evidenced by a certificate of deposit that is an instrument under the
UCC (the foregoing, collectively, Deposit Accounts),
(f) all certificated and uncertificated securities, all Pledged
Collateral (as defined in any Pledge Agreement) all security entitlements, all
securities accounts, all commodity contracts and all commodity accounts (the
foregoing, collectively, Investment Property),
(g) (i) any investment account maintained by or on behalf of the
Borrower with the Agent or any Lender or any Affiliate of the Agent or any
Lender, (ii) any agreement governing such account, (iii) all cash, money, notes,
securities, instruments, goods, accounts, documents, chattel paper, general
intangibles and other property now or hereafter held by the Agent or any Lender
or any Affiliate of the Agent or any Lender on behalf of the Borrower in
connection with such investment account or deposited by the Borrower or on the
Borrower's behalf to such investment account or otherwise credited thereto for
the Borrower's benefit, or distributable to the Borrowers from such investment
account, together with all contracts for the sale or purchase of the foregoing,
(iv) all of the Borrower's right, title and interest with respect to the
deposit, investment, allocation, disposition, distribution or withdrawal of the
foregoing, (v) all of the Borrower's right, title and interest with respect to
the making of amendments, modifications or additions of or to the terms and
conditions under which the investment account or investments maintained therein
is to be maintained by the Borrower, any Lender or any Affiliate of the Agent or
any Lender on the Borrower's behalf, and (vi) all of the Borrower's books,
records and receipts pertaining to or confirming any of the foregoing (the
foregoing, collectively, Investment Accounts),
(h) all cash or other property deposited with the Agent or any Lender
or any Affiliate of the Agent or any Lender or which the Agent, for its benefit
and for the benefit of the Lenders, or any Lender or such Affiliate is entitled
to retain or otherwise possess as collateral pursuant to the provisions of this
Agreement or any of the Loan Documents or any agreement relating to any Letter
of Credit, including, without limitation, amounts on deposit in the Cash
Collateral Account,
(i) all goods and other property, whether or not delivered, (i) the
sale or lease of which gives or purports to give rise to any Receivable,
including, but not limited to, all merchandise returned or rejected by or
repossessed from customers, or (ii) securing any Receivable, including, without
limitation, all rights as an unpaid vendor or lienor (including, without
limitation, stoppage in transit, replevin and reclamation) with respect to such
goods and other properties,
(j) all mortgages, deeds to secure debt and deeds of trust on real or
personal property, guaranties, leases, security agreements and other agreements
and property which secure or relate to any Receivable or other Collateral or are
acquired for the purpose of securing and enforcing any item thereof,
(k) all documents of title, including bills of lading and warehouse
receipts, policies and certificates of insurance, securities, chattel paper and
other documents and instruments,
(l) all files, correspondence, computer programs, tapes, disks and
related data processing software which contain information identifying or
pertaining to any of the Collateral or any Account Debtor or showing the amounts
thereof or payments thereon or otherwise necessary or helpful in the realization
thereon or the collection thereof, and
(m) any and all products and cash and non-cash proceeds of the
foregoing (including, but not limited to, any claims to any items referred to in
this definition and any claims against third parties for loss of, damage to or
destruction of any or all of the Collateral or for proceeds payable under or
unearned premiums with respect to policies of insurance) in whatever form,
including, but not limited to, cash, negotiable instruments and other
instruments for the payment of money, chattel paper, security agreements and
other documents;
provided, however, that the Collateral does not include any Receivable or
Related Security (as each such term is defined in the Intercreditor Agreement)
or any proceeds thereof, including, without being limited to, any Collections
(as defined in the Borrower RPA as in effect on the Agreement Date), sold,
assigned, transferred or contributed by the Borrower to Funding pursuant to and
in accordance with the terms of the Borrower RPA.
Commitment means, as to each Lender, the amount set forth opposite such
Lender's name on Annex A hereto, representing such Lender's obligation, upon and
subject to the terms and conditions of this Agreement (including the applicable
provisions of Section 14.1), to make its Proportionate Share of Loans under the
Revolving Credit Facility and to purchase participations in Letters of Credit
or, from and after the date hereof, as set forth in the Register representing
such Lender's obligation to make its Proportionate Share of Loans under the
Revolving Credit Facility and to purchase participations in Letters of Credit.
Commitment Percentage means, as to any Lender at the time of
determination, the percentage obtained by dividing such Lender's Commitment at
such time by the aggregate Commitments at such time.
Consolidated Subsidiaries means, as to the Borrower, Funding,
Fibermesh, SIE and any other Subsidiary of the Borrower whose accounts are at
the time in question, in accordance with GAAP and pursuant to the written
consent of the Required Lenders, which consent may be withheld in their absolute
discretion or conditioned upon, inter alia, the execution and delivery of
guaranties, security agreements, mortgages and other documents required by the
Required Lenders in their absolute discretion, consolidated with those of the
Borrower.
Contaminant means any waste, pollutant, hazardous substance, toxic
substance, hazardous waste, special waste, petroleum or petroleum-derived
substance or waste, or any constituent of any such substance or waste.
Controlled Disbursement Account means the account maintained by and in
the name of the Borrower with BankBoston for the purposes of disbursing
Revolving Credit Loan proceeds and amounts (if any) deposited thereto pursuant
to Section 9.1(b).
Copyrights means and includes, in each case whether now existing or
hereafter arising, all of the Borrower's right, title and interest in and to
(a) all copyrights, rights and interests in copyrights, works
protectable by copyright, copyright registrations and copyright applications;
(b) all renewals of any of the foregoing;
(c) all income, royalties, damages and payments now or hereafter due
and/or payable under any of the foregoing, including, without limitation,
damages or payments for past or future infringements of any of the foregoing;
(d) the right to xxx for past, present and future infringements of
any of the foregoing; and
(e) all rights corresponding to any of the foregoing throughout the
world.
Currency Agreement means any foreign exchange contract, currency swap
agreement or other similar agreement or arrangement designed to protect the
Borrower or any of its Subsidiaries in the ordinary course of business against
fluctuation in the values of the currencies of countries (other than the United
States of America) in which the Borrower or its Subsidiaries conduct business,
entered into between the Borrower and any Lender, and in form and substance
satisfactory to the Agent.
Debt means
(a) Indebtedness for money borrowed,
(b) Indebtedness, whether or not in any such case the same was for
money borrowed,
(i) represented by notes payable, drafts accepted and
reimbursement obligations under letters of credit and similar
instruments that represent extensions of credit,
(ii) constituting obligations evidenced by bonds, debentures,
notes or similar instruments, or
(iii) upon which interest charges are customarily paid or that
was issued or assumed as full or partial payment for property,
(c) Indebtedness that constitutes a Capitalized Lease Obligation,
and
(d) obligations under any Guaranty of Debt;
and, for avoidance of doubt, does not include trade payables, accrued expenses
or other current liabilities that are not "Debt."
Default means any of the events specified in Section 13.1 which
with the passage of time or giving of notice or both would constitute an Event
of Default.
Default Margin means 2.0%.
Deposit Account has the meaning set forth in the definition Collateral.
Disbursing Bank means any commercial bank with which a Controlled
Disbursement Account is maintained on or after the Effective Date.
Dollar and $ means freely transferable United States dollars.
Dollar Equivalent of the principal or face amount of any Foreign
Facility Debt means, at any time, the amount in Dollars for which such principal
or face amount could be exchanged as determined by the spot rate quoted by the
principal office of the Agent's Affiliate in London at 11:00 a.m. (London time)
two Business Days prior to the date on which such equivalent is to be
determined.
EBIT has the meaning specified in Section 12.1.
EBITDA has the meaning specified in Section 12.1.
ERISA means the Employee Retirement Income Security Act of 1974, as in
effect from time to time.
ERISA Event means (a) a "Reportable Event" as defined in Section
3032(c) of ERISA, but excluding any such event as to which the provision for 30
days' notice to the PBGC is waived under applicable regulations, (b) the filing
of a notice of intent to terminate a Benefit Plan subject to Title IV of ERISA
under a distress termination under Section 4041(c) of ERISA or the treatment of
an amendment to such a Benefit Plan as a termination under Section 4041(c) of
ERISA, (c) the institution of proceedings by the PBGC to terminate a Benefit
Plan subject to Title IV of ERISA or the appointment of a trustee to administer
any such Benefit Plan or an event or condition that might reasonably be expected
to constitute grounds under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Benefit Plan subject to Section
4042, (d) the imposition of any liability under Title IV of ERISA other than for
PBGC premiums due but not yet payable, (e) the filing of an application for a
minimum funding waiver under Section 412 of the Code, (f) a withdrawal by the
Borrower or any Related Company from a Benefit Plan subject to Section 4063 of
ERISA during a plan year in which it was a "substantial employer" as defined in
Section 4001(a)(2) of ERISA, (g) a Benefit Plan intending to qualify under
Section 401(g) of the Code losing such qualified status, (h) the failure to make
a material required contribution to a Benefit Plan, (i) the Borrower or any
Related Company being in "default" (as defined in Section 4219(c)(5) of ERISA)
with respect to payments to a Multiemployer Plan because of its complete or
partial withdrawal (as described in Section 4203 or 4205 of ERISA) from such
Multiemployer Plan, or (j) the occurrence of a non-exempt prohibited transaction
within the meaning of Section 4975 of the Code or Section 406 of ERISA with
respect to any Benefit Plan.
EagleFunding means EagleFunding Capital Corporation, a Delaware
corporation.
Effective Date means the later of:
(a) the Agreement Date, and
(b) the first date on which all of the applicable conditions set
forth in Article 6 shall have been fulfilled.
Effective Interest Rate means each rate of interest per annum on the
Loans in effect from time to time pursuant to the provisions of Sections 5.1(a),
(b), (c) and (e).
Eligible Assignee means (i) a commercial bank organized under the laws
of the United States or any state thereof having total assets in excess of
$10,000,000,000; (ii) any commercial finance or asset-based lending company
organized under the laws of the United States or any state thereof that is an
Affiliate of a commercial bank having total assets in excess of $10,000,000,000;
(iii) any Person whose primary business is asset-based lending and whose net
worth is at least $250,000,000; and (iv) any Lender listed on the signature
pages of this Agreement; provided in each case that the representation set forth
in Section 14.2 shall be applicable with respect to any such Person.
Environmental Laws means all federal, state, local and foreign laws now
or hereafter in effect relating to pollution or protection of the environment,
including laws relating to emissions, discharges, Releases or threatened
Releases of pollutants, Contaminants, chemicals, or industrial, toxic or
hazardous substances or wastes into the environment (including, without
limitation, ambient air, surface water, ground water, or land), or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, removal, transport, or handling of pollutants, Contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes, and any and
all regulations, notices or demand letters issued, entered, promulgated or
approved thereunder; such laws and regulations include but are not limited to
the Resource Conservation and Recovery Act, 42 U.S.C. ss. 6901 et seq., as
amended; the Comprehensive Environmental Response, Compensation and Liability
Act, 42 U.S.C. ss. 9601 et seq., as amended; the Toxic Substances Control Act,
15 U.S.C. ss. 2601 et seq., as amended; the Clean Air Act, 46 U.S.C. ss. 7401 et
seq., as amended; and state and federal lien and environmental cleanup programs.
Environmental Lien means a Lien in favor of any governmental entity for
(a) any liability under Environmental Laws or (b) damages arising from, or costs
incurred by such governmental entity in response to, a Release or threatened
Release of Contaminant into the environment.
Equipment has the meaning set forth in the definition Collateral.
Equity Interest has the meaning specified in Section 12.6.
Eurodollar Rate Loan means any Loan bearing interest at a rate
determined by reference to the Adjusted Eurodollar Rate, including any such
Loans continued as or converted into, a Eurodollar Rate Loan on the same day by
the Lenders for the same Interest Period.
Event of Default means any of the events specified in Section 13.1,
provided that any requirement for notice or lapse of time or any other condition
has been satisfied.
Existing Credit Agreement means the Fourth Amended and Restated
Revolving Credit and Security Agreement dated as of October 20, 1995, as
amended, to which the Borrower and BankBoston are parties.
Existing Debt means Debt issued and outstanding on the Agreement Date
to the extent set forth on Schedule 7.1(j) (but excluding any such Debt that is
to be paid in full on the Effective Date), and any renewals, extensions or
refundings thereof, but not any increases in principal amounts thereof
outstanding on the date of such renewal, extension or refunding.
Existing Guaranties means the Guaranties outstanding on the Agreement
Date to the extent set forth on Schedule 7.1(j).
Existing Liens means the Liens outstanding on the Agreement Date to the
extent set forth on Schedule 7.1(i).
Federal Funds Effective Rate means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the weighted
average of the rates on overnight federal funds transactions with members of the
Federal Reserve system arranged by federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by BankBoston from three federal funds brokers of
recognized standing selected by BankBoston.
Fibermesh means Fibermesh GmbH, a German company and a Wholly Owned
Subsidiary of the Borrower.
Financial Officer means the chief financial officer or controller or
assistant treasurer of the Borrower.
Financed Capex means Capital Expenditures of the Borrower and the
Consolidated Subsidiaries financed with Debt other than proceeds of Loans.
Financing Statements means any and all Uniform Commercial Code
financing statements, in form and substance satisfactory to the Agent, executed
and delivered by the Borrower to the Agent, naming the Agent, for the benefit of
the Lenders, as secured party and the Borrower as debtor, in connection with
this Agreement.
Foreign Facility Debt means, at any time the Dollar Equivalent of (a)
the aggregate principal amount outstanding from time to time under the revolving
credit facility provided by BankBoston's London Affiliate to SIE and each other
credit facility provided by a Lender or an Affiliate of a Lender to a Foreign
Subsidiary and which is guaranteed by the Borrower; (b) any obligation of a
Foreign Subsidiary under a letter of credit issued by a Lender for the account
of the Foreign Subsidiary under a Foreign Facility Debt Agreement; and (c) any
obligation of the Borrower or any of its Subsidiaries under any Currency
Agreement.
Foreign Facility Debt Agreement means the operative agreement or
agreements to which a Foreign Subsidiary is a party, containing the terms and
conditions of a discrete issue of Foreign Facility Debt.
Foreign Subsidiary means each of SIE and Fibermesh.
Funded Debt has the meaning specified in Section 12.1.
Funding means Synthetic Funding Corporation, a Delaware corporation and
Wholly Owned Subsidiary of the Borrower.
GAAP means generally accepted accounting principles consistently
applied and maintained throughout the period indicated and, when used with
reference to the Borrower or its Consolidated Subsidiaries, consistent with the
prior financial practice of the Borrower, as reflected on the financial
statements referred to in Section 7.1(n); provided, however, that, in the event
that changes shall be mandated by the Financial Accounting Standards Board or
any similar accounting authority of comparable standing, or shall be recommended
by the Borrower's independent public accountants, such changes shall be included
in GAAP as applicable to the Borrower only from and after such date as the
Borrower, the Required Lenders and the Agent shall have amended this Agreement
to the extent necessary to reflect any such changes in the financial covenants
set forth in Article 12.
General Intangibles has the meaning set forth in the definition
Collateral.
General Partners means, collectively, Chill Investments, Inc.,
Xxxxxxx Investments, Inc., Xxxxxx Investments, Inc., Kenner Investments, Inc.
and Freed Investments, Inc., each a Delaware corporation.
Government Acts has the meaning specified in Section 3.8(a).
Governmental Approvals means all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to, all
governmental bodies, whether federal, state, local or foreign national or
provincial and all agencies thereof.
Guaranty, Guaranteed or to Guarantee as applied to any obligation of
another Person shall mean and include
(a) a guaranty (other than by endorsement of negotiable instruments for
collection in the ordinary course of business), directly or indirectly, in any
manner, of any part or all of such obligation of such other Person, and
(b) an agreement, direct or indirect, contingent or otherwise, and
whether or not constituting a guaranty, the practical effect of which is to
assure the payment or performance (or payment of damages in the event of
nonperformance) of any part or all of such obligation of such other Person
whether by
(i) the purchase of securities or obligations,
(ii) the purchase, sale or lease (as lessee or lessor) of
property or the purchase or sale of services primarily for the purpose
of enabling the obligor with respect to such obligation to make any
payment or performance (or payment of damages in the event of
nonperformance) of or on account of any part or all of such obligation,
or to assure the owner of such obligation against loss,
(iii) the supplying of funds to or in any other manner
investing in the obligor with respect to such obligation,
(iv) repayment of amounts drawn down by beneficiaries of
letters of credit, or
(v) the supplying of funds to or investing in a Person on
account of all or any part of such Person's obligation under a Guaranty
of any obligation or indemnifying or holding harmless, in any way, such
Person against any part or all of such obligation.
IRS means the Internal Revenue Service.
Indebtedness of any Person means, without duplication, all Liabilities
of such Person, and to the extent not otherwise included in Liabilities, the
following:
(a) all obligations for money borrowed or for the deferred purchase
price of property or services or in respect of drafts accepted or similar
instruments or reimbursement obligations under letters of credit,
(b) all obligations (including, during the noncancellable term of any
lease in the nature of a title retention agreement, all future payment
obligations under such lease discounted to their present value in accordance
with GAAP) secured by any Lien to which any property or asset owned or held by
such Person is subject, whether or not the obligation secured thereby shall have
been assumed by such Person,
(c) all obligations of other Persons which such Person has Guaranteed,
including, but not limited to, all obligations of such Person consisting of
recourse liability with respect to accounts receivable sold or otherwise
disposed of by such Person,
(d) all obligations of such Person in respect of Interest Rate
Protection Agreements or Currency Agreements, and
(e) in the case of the Borrower (without duplication) all obligations
under the Loans.
Indenture means the 1997 Indenture.
Initial Notice of Borrowing means the Notice of Borrowing given by the
Borrower with respect to the Initial Loans which shall also specify the method
of disbursement.
Initial Loans means the Revolving Credit Loans made to the Borrower on
the Effective Date pursuant to the Initial Notice of Borrowing.
Intercreditor Agreement means the Intercreditor Agreement dated as of
December 18, 1997 between the Agent, Funding, the Borrower, EagleFunding and
BSI.
Interest Payment Date means the first day of each calendar month
commencing on January 1, 1998 and continuing thereafter until the Secured
Obligations have been irrevocably paid in full.
Interest Period means with respect to each Eurodollar Rate Loan, the
period commencing on the date of the making or continuation of or conversion to
such Eurodollar Rate Loan and ending one, two, three or six months thereafter,
as the Borrower may elect in the applicable Notice of Borrowing or Notice of
Conversion or Continuation; provided, that:
(i) any Interest Period that would otherwise end on a day that
is not a Business Day shall, subject to the provisions of clause (iii)
below, be extended to the next succeeding Business Day unless such
Business Day falls in the next calendar month, in which case such
Interest Period shall end on the immediately preceding Business Day;
(ii) any Interest Period that begins on the last Business Day
of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall, subject to clause (iii) below, end on the last Business
Day of a calendar month;
(iii) any Interest Period that would otherwise end after the
Termination Date shall end on the Termination Date; and
(iv) notwithstanding clause (iii) above, no Interest Period
shall have a duration of less than one month and if any applicable
Interest Period would be for a shorter period, such Interest Period
shall not be available hereunder.
Interest Rate Protection Agreement shall mean an interest rate swap,
cap or collar agreement or similar arrangement between the Borrower and any
Lender in form and substance satisfactory to the Agent, providing for the
transfer or mitigation of the Borrower's interest rate risks either generally or
under specific contingencies.
Inventory has the meaning set forth in the definition Collateral.
Investment means, with respect to any Person:
(a) the acquisition or ownership by such Person of any share of capital
stock, evidence of Debt or other security issued by any other Person,
(b) any loan, advance or extension of credit to, or contribution to the
capital of, any other Person, excluding advances to employees in the ordinary
course of business for business expenses,
(c) any Guaranty of the obligations of any other Person,
(d) any other investment (other than the Acquisition of a Business
Unit) in any other Person, and
(e) any commitment or option to make any of the investments listed in
clauses (a) through (d) above if, in the case of an option, the consideration
therefor exceeds $100.
Investment Account has the meaning set forth in the definition
Collateral.
Investment Property has the meaning set forth in the definition
Collateral.
Investor RPA means the Receivables Purchase Agreement dated as of
December 18, 1997 between Funding as seller, EagleFunding as purchaser, BSI as
"Deal Agent" and the Borrower as "Collection Agent."
Lender means at any time any financial institution party to this
agreement at such time, including any such Person becoming a party hereto
pursuant to the provisions of Article 14, and Lenders means at any time all of
the financial institutions party to this Agreement at such time, including any
such Persons becoming parties hereto pursuant to the provisions of Article 14.
Letter of Credit means any Letter of Credit issued by BankBoston for
the account of the Borrower (i) under the Existing Credit Agreement and
outstanding on the Effective Date or (ii) pursuant to Article 3.
Letter of Credit Amount means, with respect to any Letter of Credit,
the aggregate maximum amount at any time available for drawing under such Letter
of Credit.
Letter of Credit Availability means, as of the date of determination,
the aggregate face amount of Letter of Credit Obligations available to be
outstanding hereunder at the time of determination in accordance with Section
3.2, which shall be an amount equal to the lesser of (i) the Letter of Credit
Facility minus the Letter of Credit Obligations and (ii) the Revolving Credit
Availability, on such date.
Letter of Credit Facility means a subfacility of the Revolving Credit
Facility providing for the issuance of Letters of Credit up to an aggregate
amount of Letter of Credit Obligations at any one time outstanding not to exceed
the amount of $10,000,000.
Letter of Credit Obligations means, at any time, the sum of (a) the
Reimbursement Obligations of the Borrower at such time, plus (b) the aggregate
Letter of Credit Amount of Letters of Credit outstanding at such time, plus (c)
the aggregate Letter of Credit Amount of Letters of Credit the issuance of which
has been authorized by the Agent and BankBoston pursuant to Section 3.4(b) but
that have not yet been issued, in each case as determined by the Agent.
Liabilities of any Person means all items (except for items of capital
stock, additional paid-in capital or retained earnings, or of general
contingency or deferred tax reserves) which in accordance with GAAP would be
included in determining total liabilities as shown on the liability side of a
balance sheet of such Person as at the date as of which Liabilities are to be
determined.
Lien as applied to the property of any Person means:
(a) any mortgage, deed to secure debt, deed of trust, lien, pledge,
charge, lease constituting a Capitalized Lease Obligation, conditional sale or
other title retention agreement, or other security interest, security title or
encumbrance of any kind in respect of any property of such Person, or upon the
income or profits therefrom,
(b) any arrangement, express or implied, under which any property of
such Person is transferred, sequestered or otherwise identified for the purpose
of subjecting the same to the payment of Indebtedness or performance of any
other obligation in priority to the payment of the general, unsecured creditors
of such Person,
(c) any Indebtedness which is unpaid more than 30 days after the same
shall have become due and payable and which if unpaid might by law (including,
but not limited to, bankruptcy and insolvency laws), or otherwise, be given any
priority whatsoever over the claims of general unsecured creditors of such
Person,
(d) the filing of, or any agreement to give, any financing statement
under the Uniform Commercial Code or its equivalent in any jurisdiction,
excluding informational financing statements relating to property leased by the
Borrower, and
(e) in the case of Real Estate, reservations, exceptions,
encroachments, easements, rights-of-way, covenants, conditions, restrictions,
leases and other title exceptions and encumbrances.
Loan means any Revolving Credit Loan or Money Market Loan, as well as
all such loans collectively, as the context requires.
Loan Account and Loan Accounts shall have the meanings ascribed thereto
in Section 5.5.
Loan Documents means collectively this Agreement, the Notes, the
Security Documents and each other instrument, agreement or document executed by
the Borrower or any Affiliate or Subsidiary of the Borrower in connection with
this Agreement whether prior to, on or after the Effective Date and each other
instrument, agreement or document referred to herein or contemplated hereby.
Loan Party means each of the Borrower, any Subsidiary that is an
obligor on any Foreign Facility Debt and any Subsidiary that has guaranteed the
Secured Obligations.
Loan Year means each period of 12 consecutive months commencing on the
Effective Date and on each anniversary thereof.
Margin Adjustment Date has the meaning specified in Section 5.1(f).
Margin Stock means margin stock as defined in Section 221.1(h) of
Regulation U, as the same may be amended or supplemented from time to time.
Materially Adverse Effect means any act, omission, situation,
circumstance, event or undertaking which could, singly or in any combination
with one or more other acts, omissions, situations, circumstances, events or
undertakings, have, or could reasonably be expected by the Agent to have, a
materially adverse effect upon (a) the business, assets, properties,
liabilities, condition (financial or otherwise), results of operations or
business prospects of the Borrower and its Subsidiaries taken as a whole, (b)
the value of the whole or any material part of the Collateral, the Security
Interest or the priority of the Security Interest, (c) the respective ability of
the Borrower or any of its Subsidiaries to perform any obligations under this
Agreement or any other Loan Document or any Securitization Document to which it
is a party, or (d) the legality, validity, binding effect, enforceability of any
Loan Document or any Securitization Document or the ability of the Lender to
enforce any rights or remedies under or in connection with any Loan Document.
Money Market Facility means the subfacility of the Revolving Credit
Facility described in Article 4 to make Money Market Loans up to an aggregate
principal amount at any one time outstanding of up to $5,000,000.
Money Market Loan means a Loan bearing interest at the Money Market
Rate.
Money Market Loan Maturity means the maturity date of a Money Market
Loan as set forth in the applicable Money Market Loan Request, which date shall
be a Business Day not later than seven days after the date such Money Market
Loan is made and shall occur prior to the Termination Date.
Money Market Loan Request has the meaning specified in Section 4.2.
Money Market Note means the promissory note made by the Borrower to the
order of BankBoston evidencing the obligation of the Borrower to pay the
aggregate unpaid principal amount of all Money Market Loans made by BankBoston
(and any promissory note or notes that may be issued from time to time in
substitution, renewal, extension, replacement, or exchange therefor, whether
payable to BankBoston or to a different Lender, whether issued in connection
with a Person becoming a Lender after the Effective Date or otherwise)
substantially in the form of Exhibit B hereto, with all blanks properly
completed, either as originally executed or as the same may from time to time be
supplemented, modified, amended, renewed, extended or refinanced.
Money Market Rate means, at the Borrower's option, the Base Rate or a
rate of interest per annum offered to the Borrower by BankBoston in response to
a Money Market Loan Request and accepted by the Borrower.
Moody's means Xxxxx'x Investors Service, Inc.
Multiemployer Plan means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA to which the Borrower or a Related Company is required to
contribute or has contributed within the immediately preceding six years.
Net Amount means, with respect to any Investments made by any Person,
the gross amount of all such Investments minus the aggregate amount of all cash
received and the fair value, at the time of receipt by such Person, of all
property received as payments of principal or premiums, returns of capital,
liquidating dividends or distributions, proceeds of sale or other dispositions
with respect to such Investments.
Net Income or Net Loss means, as applied to any Person for any
accounting period, the net income or net loss, as the case may be, of such
Person for the period in question after giving effect to deduction of or
provision for all operating expenses, all taxes and reserves (including reserves
for deferred taxes) and all other proper deductions, all determined in
accordance with GAAP, provided that there shall be excluded:
(a) the net income or net loss of any Person accrued prior to the date
it becomes a Subsidiary of, or is merged into or consolidated with, the Person
whose Net Income is being determined or a Subsidiary of such Person,
(b) the net income or net loss of any Person in which the Person whose
Net Income is being determined or any Subsidiary of such Person has an ownership
interest, except, in the case of net income, to the extent that any such income
has actually been received by such Person or such Subsidiary in the form of cash
dividends or similar distributions,
(c) any restoration of any material contingency reserve, except to the
extent that provision for such reserve was made out of income during such
period,
(d) any net gains or net losses on the sale or other disposition, not
in the ordinary course of business, of Investments, Business Units and other
capital assets, provided that there shall also be excluded any related charges
for taxes thereon,
(e) any net gain arising from the collection of the proceeds of
any insurance policy,
(f) any write-up of any asset, and
(g) any other extraordinary item.
Net Worth means, with respect to any Person, such Person's total
shareholder's equity (including capital stock, additional paid-in capital and
retained earnings, after deducting treasury stock) which would appear as such on
a balance sheet of such Person prepared in accordance with GAAP.
1997 Indenture means the Indenture dated as of February 1, 1997, as
supplemented by First Supplemental Indenture dated as of December 18, 1997, to
which the Borrower and United States Trust Company of New York are parties, as
the same may be further supplemented, amended and modified from time to time,
consistent with the provisions of this Agreement.
Note means any of the Revolving Credit Notes or the Money Market Note
and Notes means more than one such Note.
Notice of Borrowing means a written notice, or telephonic notice
followed by a confirming same-day written notice, requesting a Borrowing of
either a Base Rate Loan or a Eurodollar Rate Loan, which is given by telex or
facsimile transmission in accordance with the applicable provisions of Section
2.2 and which specifies (i) the amount of the requested Borrowing, (ii) the date
of the requested Borrowing, and (iii) if the requested Borrowing is of a
Eurodollar Rate Loan, the duration of the applicable Interest Period.
Notice of Conversion or Continuation has the meaning specified in
Section 5.13.
PBGC means the Pension Benefit Guaranty Corporation and any successor
agency.
Patent Assignment means, collectively, the Assignment for Security
dated December 2, 1986, the Security Assignment (Patents) dated as of March 12,
1992 and the Assignment for Security Interest (Patents) dated as of December 18,
1997, each made by the Borrower in favor of the Agent with respect to certain
Patents owned by the Borrower.
Patents means and includes, in each case whether now existing or
hereafter arising, all of the Borrower's right, title and interest in and to
(i) any and all patents and patent applications,
(ii) inventions and improvements described and claimed therein,
(iii) reissues, divisions, continuations, renewals, extensions and
continuations-in-part thereof,
(iv) income, royalties, damages, claims and payments now or hereafter
due and/or payable under and with respect thereto, including, without
limitation, damages and payments for past and future infringements thereof,
(v) rights to xxx for past, present and future infringements
thereof, and
(vi) all rights corresponding to any of the foregoing throughout the
world.
Permitted Investments means (a) Investments of the Borrower in:
(i) Cash Equivalents,
(ii) sales of inventory on credit and advances to employees in
the ordinary course of business,
(iii) shares of capital stock, evidence of Debt or other
security acquired by the Borrower in consideration for or as evidence
of past-due or restructured Receivables in the ordinary course of
business,
(iv) Guaranties permitted pursuant to Section 12.3,
(v) existing Investments in Foreign Subsidiaries plus
increases therein (in excess of any increase resulting from
undistributed earnings) after the Effective Date not to exceed
$500,000,
(vi) Funding, provided that the amount of cash invested
by the Borrower in Funding shall not exceed $4,000,000, and
(vii) other Investments, the Net Amount of which does not
exceed $1,000,000 at any time;
(b) Investments of the Borrower or any Subsidiary in those items
described on Schedule 1.1B - Permitted Investments;
(c) Investments of Funding in Purchased A/R; and
(d) Investments of any Subsidiary in notes payable to such Subsidiary
by the Borrower or any other Subsidiary.
Permitted Liens means:
(a) Liens securing taxes, assessments and other governmental charges or
levies (excluding any Lien imposed pursuant to any of the provisions of ERISA)
or the claims of materialmen, mechanics, carriers, warehousemen or landlords for
labor, materials, supplies or rentals incurred in the ordinary course of
business, but (i) in all cases only if payment shall not at the time be required
to be made in accordance with Section 10.6, and (ii) in the case of warehousemen
or landlords, only if such liens are junior to the Security Interest in any of
the Collateral,
(b) Liens consisting of deposits or pledges made in the ordinary course
of business in connection with, or to secure payment of, obligations under
workers' compensation, unemployment insurance or similar legislation or under
payment or performance bonds,
(c) Liens constituting encumbrances in the nature of zoning
restrictions, easements, and rights or restrictions of record on the use of real
property, which do not materially detract from the value of such property or
impair the use thereof in the business of the Borrower,
(d) Purchase Money Liens,
(e) Liens shown on Schedule 1.1C - Permitted Liens,
(f) Liens of the Agent, for the benefit of the Lenders, arising under
this Agreement and the other Loan Documents,
(g) Liens provided for in the Securitization Documents,
(h) Liens on Margin Stock,
(i) Liens constituting non-exclusive licenses by the Borrower of
its Proprietary Rights, and
(j) Liens in existence immediately prior to the Effective Date that are
satisfied in full and released on the Effective Date or promptly thereafter as a
result of the application of the proceeds of the Loans or cash on hand or
otherwise.
Permitted Purchase Money Debt means Purchase Money Debt of the Borrower
incurred after the Agreement Date
(a) which is secured by a Purchase Money Lien, and
(b) the aggregate principal amount of which does not exceed an
amount equal to 100% of the lesser of
(i) the cost (including the principal amount of such Debt,
whether or not assumed) of the tangible personal property (other than
Inventory) subject to such Lien, and
(ii) the fair value of such tangible personal property (other
than Inventory) at the time of its acquisition. Person means an
individual, corporation, limited liability company, partnership,
association, trust or unincorporated
organization, or a government or any agency or political subdivision thereof.
Pledge Agreement means the Pledge Agreement dated as of the Effective
Date, between the Borrower and the Agent.
Pricing Coverage means the ratio of
(a) EBITDA, minus cash income taxes paid (net of cash income tax
refunds received), minus Capital Expenditures (other than Financed
Capex and less all related capitalized interest), for a specified
period to
(b) the sum of (i) Total Interest Expense (less any amortization
of bond discount) plus (ii) the aggregate amount of scheduled principal
payments on Debt during the same period.
Projections means the forecasted consolidated balance sheets and
related consolidated income and cash flow statements of the Borrower and its
Consolidated Subsidiaries for the Borrower's 1997 through 2001 fiscal years,
prepared on a quarterly basis for the Borrower's 1997 fiscal year and on an
annual basis for each fiscal year thereafter, together with appropriate
supporting details and a statement of underlying assumptions.
Proprietary Rights means all of the Borrower's now owned and hereafter
arising or acquired: Patents, Copyrights, Trademarks, including, without
limitation, the Proprietary Rights set forth on Schedule 7.1(aa) hereto, and all
other rights under any of the foregoing, all extensions, renewals, reissues,
divisions, continuations, and continuations-in-part of any of the foregoing, and
all rights to xxx for past, present and future infringement of any of the
foregoing.
Proportionate Share or Ratable Share or Ratable (and with corollary
meaning Ratably) means, as to a Lender, such Lender's share of an amount in
Dollars or other property at the time of determination equal to (i) the
Commitment Percentage of such Lender, or (ii) if the Commitments are terminated,
the percentage of the total principal amount of Loans outstanding at such time
obtained by dividing the principal amount of the Loans then owing to such Lender
by the total principal amount of all Loans then owing to all Lenders, or (iii)
if no Loans are outstanding, the percentage of the total Letter of Credit
Obligations then outstanding obtained by dividing such Lender's participation in
such Letter of Credit Obligations by the total Letter of Credit Obligations then
outstanding.
Purchase Money Debt means Debt created to finance the payment of all or
any part of the purchase price (not in excess of the fair market value thereof)
of any tangible personal property (other than Inventory) and incurred at the
time of or within 10 days prior to or after the acquisition of such tangible
asset.
Purchase Money Lien means any Lien securing Purchase Money Debt, but
only if such Lien shall at all times be confined solely to the property (other
than Inventory) the purchase price of which was financed through the incurrence
of the Purchase Money Debt secured by such Lien.
Purchase Price has the meaning specified in Section 12.4.
Purchased A/R means (i) all RPA Receivables of the Borrower sold by the
Borrower to Funding under the Borrower RPA, (ii) all Related Security (as
defined in the Intercreditor Agreement), including, without being limited to,
(A) all of the Borrower's right, title and interest in and to the goods, if any,
the sale of which gave rise to such RPA Receivables, (B) all other security
interests or Liens and property subject thereto from time to time purporting to
secure payment of any such RPA Receivable, whether pursuant to the contract (if
any) relating to such RPA Receivable or otherwise, (C) the assignment for the
benefit of Funding of all UCC financing statements covering any collateral
securing payment of such RPA Receivables, (D) all of the Borrower's right, title
and interest in and to all guarantees, indemnities, warranties, letters of
credit, insurance policies and proceeds and premium refunds thereof and other
agreements supporting or securing payment of such RPA Receivable, whether
pursuant to the contract related to such RPA Receivable or not, (E) all
documents evidencing RPA Receivables and all books, records and other
information (including, without limitation, computer programs, tapes, disks,
punch cards, data processing software and related property and rights)
maintained with respect to RPA Receivables and the obligors thereon which the
Borrower itself has generated or in which the Borrower (as Collection Agent
under the Borrower RPA or otherwise) has an interest, (F) all cash, collections
and other cash proceeds of any such RPA Receivable, including, without being
limited to, the cash proceeds of any security for any such RPA Receivable, and
(G) any lockbox, deposit or other accounts to which any such cash proceeds are
deposited.
RPA Receivable means the Indebtedness of any Person on an invoice
issued by the Borrower or pursuant to an agreement with the Borrower, in each
case substantially in the form of Schedule 1.1A, pursuant to or under which such
Person is obligated to make one or more payments to the Borrower arising from a
sale of merchandise or the performance of services by the Borrower, whether such
Indebtedness, invoice or agreement constitutes an account, chattel paper, an
instrument, a general intangible or any other type of property, and including
the right to payment of any interest or finance charges and other obligations of
the obligor with respect thereto.
Real Estate means all of the Borrower's now or hereafter owned or
leased estates in real property, including, without limitation, all fees,
leaseholds and future interests, together with all of the Borrower's now or
hereafter owned or leased interests in the improvements and emblements thereon,
the fixtures attached thereto and the easements appurtenant thereto, including,
without limitation the real property described on Schedule 7.1(w).
Receivables has the meaning set forth in the definition Collateral.
Register has the meaning specified in Section 14.1(d).
Regulation U means Regulation U of the Board of Governors of the
Federal Reserve System (or any successor), as the same may be amended or
supplemented from time to time.
Reimbursement Agreement means, with respect to a Letter of Credit, such
form of application therefor and form of reimbursement agreement therefor
(whether in a single document or several documents) as BankBoston may employ in
the ordinary course of business for its own account, with such modifications
thereto as may be agreed upon by BankBoston and the Borrower, provided that such
application and agreement and any modifications thereto are not inconsistent
with the terms of this Agreement.
Reimbursement Obligations means the reimbursement or repayment
obligations of the Borrower to BankBoston pursuant to Section 3.6 or pursuant to
a Reimbursement Agreement with respect to amounts that have been drawn under
Letters of Credit.
Related Company means any (i) corporation which is a member of the same
controlled group of corporations (within the meaning of Section 414(b) of the
Code) as the Borrower; (ii) partnership or other trade or business (whether or
not incorporated) under common control (within the meaning of Section 414(c) of
the Code) with the Borrower; or (iii) member of the same affiliated service
group (within the meaning of Section 414(m) of the Code) as the Borrower, any
corporation described in clause (i) above or any partnership, trade or business
described in clause (ii) above.
Release means release, spill, emission, leaking, pumping, injection,
deposit, disposal, discharge, dispersal, leaching or migration into the indoor
or outdoor environment or into or out of any property, including the movement of
Contaminants through or in the air, soil, surface water or groundwater.
Replacement Lender has the meaning specified in Section 5.15.
Remedial Action means actions required to (i) clean up, remove, treat
or in any other way address Contaminants in the indoor or outdoor environment;
(ii) prevent the Release or threat of Release or minimize the further Release of
Contaminants so they do not migrate or endanger or threaten to endanger public
health or welfare or the indoor or outdoor environment; or (iii) perform
pre-remedial studies and investigations and post-remedial monitoring and care.
Required Lenders means, at any time, any combination of Lenders whose
Commitment Percentages at such time are at least equal, in the aggregate, to
51%.
Restricted Distribution by any Person means (i) its retirement,
redemption, purchase, or other acquisition or retirement for value of any
capital stock or other equity securities (except equity securities acquired on
the conversion thereof into other equity securities of such Person) or
partnership interests issued by such Person, (ii) the declaration or payment of
any dividend or distribution in cash or property on or with respect to any such
securities (other than dividends payable solely in shares of its capital stock)
or partnership interests, excluding, however, any such dividend, distribution or
payment to the Borrower by any Subsidiary of the Borrower, (iii) any loan or
advance by such Person to, or other investment by such Person in, the holder of
any of such securities or partnership interests, and (iv) any other payment by
such Person in respect of such securities or partnership interests.
Restricted Payment means (a) any redemption or prepayment or other
retirement, prior to the stated maturity thereof or prior to the due date of any
regularly scheduled installment or amortization payment with respect thereto, of
any Debt (other than the Loans or the Foreign Facility Debt), (b) the payment by
any Person of the principal amount of or interest on any Indebtedness (other
than trade debt) owing to an Affiliate of such Person or to any Affiliate of any
such Affiliate and (c) the payment of any management, consulting or similar fee
by any Person to any Affiliate of such Person.
Revolving Credit Availability means, as of the date of determination,
the aggregate principal amount of Revolving Credit Loans available to be
borrowed by the Borrower hereunder at the time in accordance with Section 2.1,
which shall be an amount equal to the excess (if any) of the Revolving Credit
Facility over the sum of the aggregate principal amount of Revolving Credit
Loans and Money Market Loans outstanding on such date plus the Letter of Credit
Obligations on such date.
Revolving Credit Facility means the credit facility providing for
Revolving Credit Loans described in Section 2.1 up to an aggregate principal
amount at any one time outstanding not to exceed $60,000,000 or such lesser or
greater amount as shall be agreed upon from time to time in writing by the
Agent, the Lenders and the Borrower.
Revolving Credit Loans means loans made to the Borrower pursuant to
Section 2.1.
Revolving Credit Note means each Revolving Credit Note made by the
Borrower payable to the order of a Lender evidencing the obligation of the
Borrower to pay the aggregate unpaid principal amount of the Loans made to it by
such Lender under the Revolving Credit Facility (and any promissory note or
notes that may be issued from time to time in substitution, renewal, extension,
replacement or exchange therefor whether payable to such Lender or to a
different Lender in connection with a Person becoming a Lender after the
Effective Date or otherwise) substantially in the form of Exhibit A hereto, with
all blanks properly completed, either as originally executed or as the same may
from time to time be supplemented, modified, amended, renewed, extended or
refinanced.
S&P means Standard & Poor's Ratings Group, a Division of The
XxXxxx-Xxxx Companies.
SIE means Synthetic Industries Europe Limited (Reg. No. 2772124), a
registered English limited liability company, wholly owned by the Borrower.
SI Management means SI Management L.P., a Delaware limited partnership,
which is the general partner of Synthetic L.P., and its successors and assigns.
Schedule of Inventory means a schedule delivered by the Borrower to the
Agent pursuant to the provisions of Section 9.10(b).
Secured Obligations means, in each case whether now in existence or
hereafter arising,
(a) the principal of, and interest and premium, if any, on, the Loans,
(b) the Reimbursement Obligations and all other obligations of the
Borrower to BankBoston, the Agent or any Lender arising in connection with the
Letters of Credit,
(c) all obligations of the Borrower with respect to any Foreign
Facility Debt,
(d) all obligations to any Lender or any Affiliate of a Lender under
any Interest Rate Protection Agreement or Currency Agreement, and
(e) all indebtedness, liabilities, obligations, covenants and duties of
the Borrower or any Subsidiary of the Borrower to the Agent or to the Lenders or
to any Affiliate of the Agent or the Lender of every kind, nature and
description arising under or in respect of this Agreement, the Notes or any of
the other Loan Documents, whether direct or indirect, absolute or contingent,
due or not due, contractual or tortious, liquidated or unliquidated, and whether
or not evidenced by any note, and whether or not for the payment of money,
including without limitation, fees required to be paid pursuant to Article 5 and
expenses required to be paid or reimbursed pursuant to Section 16.2.
Securitization means the integrated transactions contemplated by the
Securitization Documents.
Securitization Documents means (i) the Borrower RPA, (ii) the Investor
RPA, (iii) the Intercreditor Agreement, (iv) any Lock-Box Agreement (as defined
in the Investor RPA), (v) the Collection Account Agreement (as defined in the
Investor RPA), and (vi) the other instruments, agreements, fee letters,
financing statements and other documents contemplated by the foregoing to be
executed and delivered by the Borrower or Funding on or prior to the date of the
initial Purchase (as defined in the Borrower RPA) thereunder, in each case as
amended in accordance with the provisions hereof.
Security Documents means each of the following:
(a) the Financing Statements,
(b) the Patent Assignment,
(c) the Trademark Assignment,
(d) the Pledge Agreement, and
(e) each other writing executed and delivered by the Borrower or any
other Person securing the Secured Obligations.
Security Interest means the Liens of the Agent on and in the Collateral
effected hereby or by any of the Security Documents or pursuant to the terms
hereof or thereof.
Senior Sub Debt means $170,000,000 original principal amount of 9-1/4%
Senior Subordinated Notes due 2007 issued by the Borrower pursuant to the 1997
Indenture.
Subordinated Debt means the Senior Sub Debt and any other Debt of the
Borrower that is subordinated to the Secured Obligations on terms and conditions
satisfactory to the Agent and the Required Lenders.
Subsidiary
(a) when used to determine the relationship of a Person to another
Person, means a Person of which an aggregate of 50% or more of the stock of any
class or classes or 50% or more of other ownership interests is owned of record
or beneficially by such other Person, or by one or more Subsidiaries of such
other Person, or by such other Person and one or more Subsidiaries of such
Person,
(i) if the holders of such stock, or other ownership
interests, (A) are ordinarily, in the absence of contingencies,
entitled to vote for the election of a majority of the directors (or
other individuals performing similar functions) of such Person, even
though the right so to vote has been suspended by the happening of such
a contingency, or (B) are entitled, as such holders, to vote for the
election of a majority of the directors (or individuals performing
similar functions) of such Person, whether or not the right so to vote
exists by reason of the happening of a contingency, or
(ii) in the case of such other ownership interests, if such
ownership interests constitute a majority voting interest, and
(b) when used without other designation of ownership, means a
Subsidiary of the Borrower.
Subsidiary Guarantor means any Subsidiary party to the Subsidiary
Guaranty.
Subsidiary Guaranty means a Guaranty Agreement with respect to the
Secured Obligations substantially in the form on Exhibit E.
Supporting Letter of Credit has the meaning specified in Section 3.9.
Synthetic L.P. means Synthetic Industries L.P., a Delaware limited
partnership.
Synthetic Management means Synthetic Management G.P., a Georgia general
partnership, the general partners of which are the General Partners.
Termination Date means December 18, 2002, or such earlier date as all
Secured Obligations shall have been irrevocably paid in full and the Revolving
Credit Facility shall have been terminated.
Total Interest Expense has the meaning specified in Section 12.1.
Trademark Assignment means the Security Agreement (Trademarks) dated as
of December 2, 1986, the Trademark Security Interest dated as of December 17,
1990, the Security Assignment (Trademarks) dated as of March 12, 1992 and the
Security Assignment (Trademarks) dated as of March 17, 1993, each as recorded in
with the United States Patent Trademark Office and the Assignment for Security
Interest - Trademarks, dated on or about the Effective Date, each made by the
Borrower to the Agent for the benefit of the Lenders, as the same may be
amended, modified or supplemented from time to time.
Trademarks means and includes in each case whether now existing or
hereafter arising, all of the Borrower's right, title and interest in and to
(a) trademarks (including service marks), trade names and trade styles
and the registrations and applications for registration thereof and the goodwill
of the business symbolized by the trademarks,
(b) licenses of the foregoing, whether as licensee or licensor,
(c) renewals thereof,
(d) income, royalties, damages and payments now or hereafter due and/or
payable with respect thereto, including, without limitation, damages, claims and
payments for past and future infringements thereof,
(e) rights to xxx for past, present and future infringements thereof,
including the right to settle suits involving claims and demands for royalties
owing, and
(f) all rights corresponding to any of the foregoing throughout the
world.
Type when used in respect of any Revolving Credit Loan or Borrowing,
shall refer to the rate by reference to which interest on such Loan or on the
Loans comprising such Borrowing is computed.
UCC means the Uniform Commercial Code as in effect from time to time in
the State of Georgia.
Unfunded Vested Accrued Benefits means with respect to any Benefit Plan
at any time, the amount (if any) by which
(a) the present value of all vested nonforfeitable benefits under
such Benefit Plan exceeds
(b) the fair market value of all Benefit Plan assets allocable to such
benefits,
all determined as of the then most recent valuation date for such Benefit Plan.
Unused Facility means at any time, the Revolving Credit Facility in
effect at such time, less the sum of the aggregate outstanding principal amount
of Revolving Credit Loans and the Letter of Credit Obligations, at such time.
Wholly Owned Subsidiary when used to determine the relationship of a
Subsidiary to a Person means a Subsidiary all of the issued and outstanding
shares (other than directors' qualifying shares) of the capital stock of which
shall at the time be owned by such Person or one or more of such Person's Wholly
Owned Subsidiaries or by such Person and one or more of such Person's Wholly
Owned Subsidiaries.
SECTION 1.2 General Interpretive Rules.
(a) All terms of an accounting nature not specifically defined herein
shall have the meaning ascribed thereto by GAAP.
(b) The terms accounts, chattel paper, contract rights, documents,
equipment, instruments, general intangibles, inventory and proceeds, as and when
used in this Agreement or the Security Documents, shall have the meanings given
those terms in the UCC.
(c) Unless otherwise specified, the words "hereof," "herein,"
"hereunder" and words of similar import, when used in this Agreement, refer to
this Agreement as a whole and not to any particular provision, section or
subsection of this Agreement.
(d) Wherever from the context it appears appropriate, each term stated
in either the singular or plural shall include the singular and plural, and
pronouns stated in the masculine, feminine or neuter gender shall include the
masculine, the feminine and the neuter. Words denoting individuals include
corporations and vice versa.
(e) References to any legislation or statute or code, or to any
provisions of any legislation or statute or code, shall include any modification
or reenactment of, or any legislative, statutory or code provision substituted
for, such legislation, statute or code or provision thereof.
(f) References to any document or agreement (including this Agreement)
shall include references to such document or agreement as amended, novated,
supplemented, modified or replaced from time to time, so long as and to the
extent that such amendment, novation, supplement, modification or replacement is
either not prohibited by the terms of this Agreement or is consented to by the
Required Lenders and the Agent.
(g) Except where specifically restricted in a Loan Document, references
to any Person include its successor or permitted substitutes and assigns
permitted or not prohibited under such Loan Document.
(h) References to the time of day are to the time of day in the city in
which the Agent's Office is located.
(i) The terms "payment", "prepayment", "distribution" and similar terms
used in the definitions of "Restricted Distribution" and "Restricted Payment"
and in Section 10.6, shall include payment by means of the transfer of funds or
of property and, in the event of a transfer of property, the payment shall be
deemed to be in an amount equal to the greater of the fair market value and the
book value of the property at the time of the transfer.
(j) Titles of Articles and Sections in this Agreement are for
convenience only, do not constitute part of this Agreement and neither limit nor
amplify the provisions of this Agreement, and all references in this Agreement
to Articles, Sections, subsections, paragraphs, clauses, subclauses, Schedules
or Exhibits shall refer to the corresponding Article, Section, subsection,
paragraph, clause or subclause of, or Schedule or Exhibit attached to, this
Agreement, unless specific reference is made to the articles, sections or other
subdivisions or divisions of, or to schedules or exhibits to, another document
or instrument.
(k) Whenever from the context it appears appropriate, the term "Loan",
including such terms as used as part of a defined term including the term
"Loan", shall mean and include a Loan made by all Lenders to the Borrower as
well as a Lender's Proportionate Share of any Loan.
(l) Unless otherwise specified herein, any Lien created or purported to
be created hereby or by or pursuant to any Loan Document in favor of the Agent
and each payment made to the Agent, is and shall be deemed to have been created
in favor of the Agent, for its benefit as Agent and for the Ratable benefit of
the Lenders, or made to and received by the Agent for the Ratable benefit of the
Lenders.
(m) Whenever the phrase "to the knowledge of the Borrower" or words of
similar import relating to the knowledge of the Borrower are used herein, such
phrase shall mean and refer to (i) the actual knowledge of the chief executive
officer, chief operating officer or chief financial officer or (ii) the
knowledge that such officers would have obtained if they had engaged in good
faith in the diligent performance of their duties, including the making of such
reasonable specific inquiries as may be necessary of the appropriate persons in
a good faith attempt to ascertain the accuracy of the matter to which such
phrase relates.
SECTION 1.3 Exhibits and Schedules. All Exhibits and Schedules
attached hereto are by reference made a part hereof.
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ARTICLE 2
REVOLVING CREDIT FACILITY
SECTION 2.1 Loans. Upon the terms and subject to the conditions of, and
in reliance upon the representations and warranties made under, this Agreement,
each Lender agrees, severally, but not jointly, to make Loans under the
Revolving Credit Facility to the Borrower from time to time from the Effective
Date to but not including the Termination Date, as requested or deemed requested
by the Borrower in accordance with the terms of Section 2.2, in amounts equal to
such Lender's Proportionate Share of each Loan requested or deemed requested
hereunder up to an aggregate amount at any one time outstanding equal to such
Lender's Proportionate Share of (i) the Revolving Credit Facility less (ii) the
sum of the Letter of Credit Obligations and the aggregate outstanding principal
amount of Money Market Loans; provided, however, that no Borrowing shall exceed
the Revolving Credit Availability at the time and the aggregate principal amount
of all outstanding Loans under the Revolving Credit Facility (after giving
effect to the Loans requested) shall not exceed the Revolving Credit Facility
less the sum of the Letter of Credit Obligations and the aggregate outstanding
principal amount of Money Market Loans. Should the aggregate outstanding amount
of Loans exceed the ceiling so determined or any other limitation set forth in
this Agreement, such Loans shall nevertheless constitute Secured Obligations
and, as such, shall be entitled to all benefits thereof and security therefor.
The principal amount of any Loans made under the Revolving Credit Facility which
is repaid may be reborrowed by the Borrower, subject to the terms and conditions
of this Agreement, in accordance with the terms of this Section 2.1. The Agent's
and each Lender's books and records reflecting the date and the amount of each
Loan made under the Revolving Credit Facility and each repayment of principal
thereof shall constitute prima facie evidence of the accuracy of the information
contained therein, subject to the provisions of Section 5.5.
SECTION 2.2 Manner of Borrowing. Borrowings under the Revolving Credit
Facility shall be made as follows:
(a) Requests for Borrowing.
(i) Base Rate Loans. Unless the Borrower shall previously have
requested a Eurodollar Rate Loan and authorized the application of the
proceeds thereof to any purpose described in clauses (A) through (D)
below and the Lenders shall have disbursed such Eurodollar Rate Loan
for such purpose, a request for the Borrowing of a Base Rate Loan shall
be made, or shall be deemed to be made, in the following manner:
(A) with respect to the initial Borrowing to be made
on the Effective Date, which shall be a Base Rate Loan, the
Borrower shall give the Agent an Initial Notice of Borrowing
at least two Business Days prior to the proposed date of the
Borrowing, and, with respect to each subsequent Borrowing, the
Borrower may request a Base Rate Loan by giving the Agent a
Notice of Borrowing, before 11:30 a.m. on the proposed date of
the Borrowing, provided that if such notice is received after
11:30 a.m. on the proposed date of Borrowing, the proposed
Borrowing may be postponed by the Agent to the next Business
Day;
(B) whenever a check or other item is presented for
payment against a Controlled Disbursement Account in an amount
greater than the then available balance in such account,
BankBoston shall, and is hereby irrevocably authorized by the
Borrower to, give the Agent notice thereof, which notice shall
be deemed to be a request for a Base Rate Loan on the date of
such notice in an amount equal to the excess of such check or
other item over such available balance, and such request shall
be irrevocable;
(C) unless payment is otherwise made by the Borrower,
the becoming due of any amount required to be paid under this
Agreement, any of the Notes or any other Loan Document shall
be deemed to be a request for a Base Rate Loan on the due date
in the amount required to pay such amount, and such request
shall be irrevocable; and
(D) the receipt by the Agent of notification from
BankBoston to the effect that a drawing has been made under a
Letter of Credit and that the Borrower has failed to reimburse
BankBoston therefor in accordance with the terms of the Letter
of Credit, the Reimbursement Agreement and Article 3, shall be
deemed to be a request for a Base Rate Loan on the date such
notification is received in the amount of such drawing which
is so unreimbursed.
(ii) Eurodollar Rate Loans. At any time after the Effective
Date, the Borrower may request a Eurodollar Rate Loan under the
Revolving Credit Facility by giving the Agent a Notice of Borrowing
(which notice shall be irrevocable) not later than 11:30 a.m. on the
date three Business Days before the day on which the requested
Eurodollar Rate Loan is to be made.
(iii) Notification of Lenders. In the case of each Eurodollar
Rate Loan and in the case of each Base Rate Loan, the Agent shall
promptly notify the Lenders of any notice of Borrowing given or deemed
given pursuant to this Section 2.2(a) by 1:00 p.m. on the proposed
Borrowing date (in the case of Base Rate Loans) or by 3:00 p.m. three
Business Days before the proposed Borrowing date (in the case of
Eurodollar Rate Loans). Not later than 2:30 p.m. on the proposed
Borrowing date, each Lender will make available to the Agent, for the
account of the Borrower, at the Agent's Office in funds immediately
available to the Agent, such Lender's Proportionate Share of the Base
Rate Loan or Eurodollar Rate Loan, as the case may be.
(b) Disbursement of Loans. The Borrower hereby irrevocably authorizes
the Agent to disburse the proceeds of each Borrowing requested, or deemed to be
requested, pursuant to this Section 2.2 as follows:
(i) the proceeds of each Borrowing requested under Sections
2.2(a)(i)(A) (other than the Borrowing of the Initial Loans) or (B) or
2.2(a)(ii) shall be disbursed by the Agent in Dollars in immediately
available funds by internal transfer or wire transfer to a Controlled
Disbursement Account or to such other account as may be agreed upon by
the Borrower and the Agent from time to time, and the proceeds of the
Initial Loans under Section 2.2(a)(i)(A) shall be disbursed in
accordance with the Initial Notice of Borrowing,
(ii) the proceeds of each Borrowing deemed requested under
Section 2.2(a)(i)(C) shall be disbursed by the Agent by way of direct
payment of the relevant amount, and
(iii) the proceeds of each Borrowing deemed requested under
Section 2.2(a)(i)(D) shall be disbursed by the Agent directly to
BankBoston on behalf of the Borrower.
SECTION 2.3 Repayment of Loans. The Revolving Credit Loans will be
repaid as follows:
(a) The outstanding principal amount of all the Loans is due and
payable, and shall be repaid by the Borrower in full, not later than the
Termination Date; and
(b) If at any time the aggregate outstanding unpaid principal amount of
the Loans exceeds the Revolving Credit Facility less the sum of the Letter of
Credit Obligations and the aggregate outstanding principal amount of the Money
Market Loans, in each case as in effect at such time, the Borrower shall repay
the Loans in an amount sufficient to reduce the aggregate unpaid principal
amount of such Loans by an amount equal to such excess, together with accrued
and unpaid interest on the amount so repaid to the date of repayment.
Repayments pursuant to Section 2.3(b) shall be applied first to Money Market
Loans, then to Base Rate Loans and then to Eurodollar Rate Loans.
SECTION 2.4 Note. Each Lender's Revolving Credit Loans and the
obligation of the Borrower to repay such Loans shall also be evidenced by a
Revolving Credit Note payable to the order of such Lender. Each Revolving Credit
Note shall be dated the Effective Date (or later "effective date" under any
Assignment and Acceptance) and be duly and validly executed and delivered by the
Borrower.
ARTICLE 3
LETTER OF CREDIT FACILITY
SECTION 3.1 Agreement to Issue. Upon the terms and subject to the
conditions of, and in reliance upon the representations and warranties made
under, this Agreement, BankBoston agrees to issue for the account of the
Borrower one or more standby or documentary Letters of Credit in accordance with
this Article 3, from time to time during the period commencing on the Effective
Date and ending on the Termination Date.
SECTION 3.2 Amounts. BankBoston shall not have any obligation to
issue any Letter of Credit at any time:
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(a) if, after giving effect to the issuance of the requested Letter of
Credit, (i) the aggregate Letter of Credit Obligations of the Borrower would
exceed the Letter of Credit Facility then in effect or (ii) the aggregate
principal amount of the Revolving Credit Loans, Money Market Loans and Letter of
Credit Obligations would exceed the Revolving Credit Facility; or
(b) which has a term longer than one calendar year (but which may
contain an "evergreen" provision or provision for automatic annual renewal) or
an expiration date after the last Business Day that is more than 30 days prior
to the Termination Date.
SECTION 3.3 Conditions. The obligation of BankBoston to issue any
Letter of Credit is subject to the satisfaction of (a) the applicable conditions
precedent contained in Article 6 and (b) the following additional conditions
precedent in a manner satisfactory to the Agent and BankBoston:
(i) the purpose for which the Letter of Credit is to be used
shall not be inconsistent with the provisions of this Agreement,
including those relating to use of proceeds of the Loans;
(ii) the Borrower shall have delivered to BankBoston and the
Agent at such times and in such manner as BankBoston or the Agent may
prescribe an application in form and substance satisfactory to
BankBoston and the Agent for the issuance of the Letter of Credit, a
Reimbursement Agreement and such other documents as may be required
pursuant to the terms thereof, and the form and terms of the proposed
Letter of Credit shall be satisfactory to BankBoston and the Agent; and
(iii) as of the date of issuance, no order of any court,
arbitrator or governmental authority having jurisdiction or authority
over BankBoston shall purport by its terms to enjoin or restrain banks
generally from issuing letters of credit of the type and in the amount
of the proposed Letter of Credit, and no law, rule or regulation
applicable to banks generally and no request or directive (whether or
not having the force of law) from any governmental authority with
jurisdiction over banks generally shall prohibit, or request that
BankBoston refrain from, the issuance of letters of credit generally or
the issuance of such Letter of Credit.
SECTION 3.4 Issuance of Letters of Credit.
(a) Request for Issuance. The Borrower shall give BankBoston and the
Agent written notice of the Borrower's request for the issuance of a Letter of
Credit no later than six Business Days prior to the proposed date of issuance of
the Letter of Credit. Such notice shall be irrevocable and shall specify the
original face amount of the Letter of Credit requested, the effective date
(which date shall be a Business Day) of issuance of such requested Letter of
Credit, whether such Letter of Credit may be drawn in a single or in multiple
draws, the date on which such requested Letter of Credit is to expire (which
date shall be a Business Day earlier than the 30th day prior to the Termination
Date), the purpose for which such Letter of Credit is to be issued and the
beneficiary of the requested Letter of Credit.
(b) Responsibilities of the Agent; Issuance. The Agent shall determine,
as of the Business Day immediately preceding the requested effective date of
issuance of the Letter of Credit set forth in the notice from the Borrower
pursuant to Section 3.4(a), the amount of the Letter of Credit Availability. If
(i) the form of the Letter of Credit delivered by the Borrower to the Agent is
acceptable to BankBoston and the Agent in their reasonable discretion, (ii) the
undrawn face amount of the requested Letter of Credit is less than or equal to
the Letter of Credit Availability and (iii) the Agent has received a certificate
(which is accurate) from the Borrower stating that the applicable conditions set
forth in Article 6 have been satisfied, then BankBoston will cause the Letter of
Credit to be issued.
(c) Notice of Issuance. Promptly after the issuance of any Letter of
Credit, BankBoston shall give the Agent written or facsimile notice, or
telephonic notice confirmed promptly thereafter in writing, of the issuance of
such Letter of Credit, and the Agent shall periodically give each Lender written
or facsimile notice of the issuance of such Letter of Credit.
(d) No Extension or Amendment. No Letter of Credit shall be extended or
amended unless the requirements of this Section 3.4 are met as though a new
Letter of Credit were being requested and issued.
SECTION 3.5 Duties of BankBoston. Any action taken or omitted to be
taken by BankBoston under or in connection with any Letter of Credit, if taken
or omitted in the absence of gross negligence or willful misconduct, shall not
result in any liability of BankBoston to any Lender or relieve any Lender of its
obligations hereunder to BankBoston. In determining whether to pay under any
Letter of Credit, BankBoston shall have no obligation to any Lender other than
to confirm that any documents required to be delivered under such Letter of
Credit in connection with such drawing have been presented and appear on their
face to comply with the requirements of such Letter of Credit.
SECTION 3.6 Payment of Reimbursement Obligations.
(a) Payment to Issuer. Notwithstanding any provisions to the contrary
in any Reimbursement Agreement, the Borrower agrees to reimburse BankBoston for
any drawings (whether partial or full) under each Letter of Credit issued by
BankBoston and agrees to pay to BankBoston the amount of all other Reimbursement
Obligations and other amounts payable to BankBoston under or in connection with
such Letter of Credit immediately when due, irrespective of any claim, set-off,
defense or other right which the Borrower may have at any time against
BankBoston or any other Person.
(b) Recovery or Avoidance of Payments. In the event any payment by or
on behalf of the Borrower with respect to any Letter of Credit (or any
Reimbursement Obligation relating thereto) received by BankBoston, or by the
Agent and distributed by the Agent to the Lenders on account of their respective
participations therein, is thereafter set aside, avoided or recovered from
BankBoston or the Agent in connection with any receivership, liquidation or
bankruptcy proceeding, the Lenders shall, upon demand by the Agent, pay to the
Agent, for the account of the Agent or BankBoston, their respective
Proportionate Shares of such amount set aside, avoided or recovered together
with interest at the rate required to be paid by the Agent upon the amount
required to be repaid by it.
SECTION 3.7 Participations.
(a) Purchase of Participations. Immediately upon the occurrence of the
Effective Date as to all Letters of Credit outstanding on the Effective Date and
immediately upon issuance by BankBoston of a Letter of Credit thereafter, each
Lender shall be deemed to have irrevocably and unconditionally purchased and
received without recourse or warranty, an undivided interest and participation
in such Letter of Credit, equal to such Lender's Proportionate Share of the face
amount thereof (including, without limitation, all obligations of the Borrower
with respect thereto, other than amounts owing to BankBoston under Section
5.2(d), and any security therefor or guaranty pertaining thereto).
(b) Sharing of Letter of Credit Payments. In the event that BankBoston
makes a payment under any Letter of Credit and BankBoston shall not have been
repaid such amount pursuant to Section 3.6, then BankBoston shall be deemed to
have made a non-ratable Revolving Credit Loan in the amount of such payment, and
notwithstanding the occurrence or continuance of a Default or Event of Default
at the time of such payment, such non-ratable Loan shall be subject to the
provisions of Section 3.7(c) and the absolute obligations of the Lenders to pay
for their respective participation interests therein.
(c) Non-Ratable Revolving Credit Loans. Each non-ratable Revolving
Credit Loan made by BankBoston pursuant to Section 3.7(b) shall be deemed to be
a purchase by BankBoston of a 100% participation in each other Lender's
Commitment Percentage of the amount of such non-ratable Revolving Credit Loan.
All payments of principal, interest and any other amount with respect to such
non-ratable Revolving Credit Loan shall be payable to and received by the Agent
for the account of BankBoston. Upon demand by BankBoston, with notice thereof to
the Agent, each other Lender shall pay to BankBoston, as the repurchase of such
participation, an amount equal to 100% of such Lender's Commitment Percentage of
the principal amount of such non-ratable Revolving Credit Loan. Any payments
received by the Agent prior to such payment by the other Lenders and which in
accordance with the terms of this Agreement are to be applied to the reduction
of the outstanding principal balance of Revolving Credit Loans, shall be paid
over to and retained by BankBoston for application to outstanding non-ratable
Revolving Credit Loans (to the extent of such Loans), and such payment to and
retention by BankBoston shall be deemed, to the extent of each other Lender's
Ratable share thereof, to be a (partial) repurchase by each such other Lender of
such participations in the non-ratable Revolving Credit Loans held by
BankBoston.
(d) Sharing of Reimbursement Obligation Payments. Whenever BankBoston
receives a payment from or on behalf of the Borrower on account of a
Reimbursement Obligation as to which the Agent has previously received for the
account of BankBoston payment from a Lender pursuant to this Section 3.7,
BankBoston shall promptly pay to the Agent, for the benefit of such Lender, such
Lender's Proportionate Share of the amount of such payment from the Borrower in
Dollars. Each such payment shall be made by BankBoston on the Business Day on
which BankBoston receives immediately available funds from the Agent pursuant to
the immediately preceding sentence, if received prior to 11:00 a.m. on such
Business Day, and otherwise on the next succeeding Business Day.
(e) Documentation. Upon the request of any Lender, the Agent shall
furnish to such Lender copies of any Letter of Credit, Reimbursement Agreement
or application for any Letter of Credit and such other documentation as may
reasonably be requested by such Lender.
(f) Obligations Irrevocable. The obligations of each Lender to make
payments to the Agent with respect to any Letter of Credit and their
participations therein pursuant to the provisions of Section 3.7(c) hereof or
otherwise and the obligations of the Borrower to make payments to BankBoston or
to the Agent, for the account of Lenders, shall be irrevocable, shall not be
subject to any qualification or exception whatsoever and shall be made in
accordance with the terms and conditions of this Agreement (assuming, in the
case of the obligations of the Lenders to make such payments, that the Letter of
Credit has been issued in accordance with Section 3.4), including, without
limitation, any of the following circumstances:
(i) Any lack of validity or enforceability of this
Agreement or any of the other Loan Documents;
(ii) The existence of any claim, set-off, defense or other
right which the Borrower may have at any time against a beneficiary
named in a Letter of Credit or any transferee of any Letter of Credit
(or any Person for whom any such transferee may be acting), any Lender,
BankBoston or any other Person, whether in connection with this
Agreement, any Letter of Credit, the transactions contemplated herein
or any unrelated transactions (including any underlying transactions
between the Borrower or any other Person and the beneficiary named in
any Letter of Credit);
(iii) Any draft, certificate or any other document presented
under the Letter of Credit upon which payment has been made in good
faith and according to its terms proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect;
(iv) The surrender or impairment of any Collateral or any
other security for the Secured Obligations or the performance or
observance of any of the terms of any of the Loan Documents;
(v) The occurrence of any Default or Event of Default; or
(vi) The Agent's failure to deliver the notice provided for in
Section 3.4(c).
SECTION 3.8 Indemnification, Exoneration.
(a) Indemnification. In addition to amounts payable as elsewhere
provided in this Article 3, the Borrower agrees to protect, indemnify, pay and
hold harmless the Lenders and the Agent from and against any and all claims,
demands, liabilities, damages, losses, costs, charges and expenses (including
reasonable attorneys' fees) which any Lender or the Agent may incur or be
subject to as a consequence, directly or indirectly, of
(i) the issuance of any Letter of Credit, other than as a
result of its gross negligence or willful misconduct, as determined by
a court of competent jurisdiction, or
(ii) the failure of BankBoston to honor a drawing under any
Letter of Credit as a result of any act or omission, whether rightful
or wrongful, of any present or future de jure or de facto governmental
authority (all such acts or omissions being hereinafter referred to
collectively as Government Acts).
(b) Assumption of Risk by the Borrower. As among the Borrower, the
Lenders and the Agent, the Borrower assumes all risks of the acts and omissions
of, or misuse of any of the Letters of Credit by, the respective beneficiaries
of such Letters of Credit. In furtherance and not in limitation of the
foregoing, subject to the provisions of the applications for the issuance of
Letters of Credit, the Lenders and the Agent shall not be responsible for:
(i) the form, validity, sufficiency, accuracy, genuineness or
legal effect of any document submitted by any Person in connection with
the application for and issuance of and presentation of drafts with
respect to any of the Letters of Credit, even if it should prove to be
in any or all respects invalid, insufficient, inaccurate, fraudulent or
forged;
(ii) the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign any
Letter of Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, which may prove to be invalid or
ineffective for any reason;
(iii) the failure of the beneficiary of any Letter of Credit
to comply duly with conditions required in order to draw upon such
Letter of Credit;
(iv) errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable, telegraph,
telex or otherwise, whether or not they be in cipher;
(v) errors in interpretation of technical terms;
(vi) any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any Letter of Credit
or of the proceeds thereof;
(vii) the misapplication by the beneficiary of any Letter of
Credit of the proceeds of any drawing under such Letter of Credit; or
(viii) any consequences arising from causes beyond the control
of the Lenders or the Agent, including, without limitation, any
Government Acts.
None of the foregoing shall affect, impair or prevent the vesting of any of the
Agent's rights or powers under this Section 3.8.
(c) Exoneration. In furtherance and extension, and not in limitation,
of the specific provisions set forth above, any action taken or omitted by the
Agent, BankBoston or any Lender under or in connection with any of the Letters
of Credit or any related certificates, if taken or omitted in good faith, shall
not result in any liability of any Lender or the Agent to the Borrower or
relieve the Borrower of any of its obligations hereunder to any such Person.
SECTION 3.9 Supporting Letter of Credit; Cash Collateral Account. Upon
the occurrence of an Event of Default or, if, notwithstanding the provisions of
Section 3.2(b), any Letter of Credit is outstanding on the Termination Date,
then on or prior to the Termination Date, the Borrower shall, promptly on demand
by the Agent, deposit with the Agent, for the ratable benefit of the Lenders,
with respect to each Letter of Credit then outstanding, as the Agent shall
specify, either (a) a standby letter of credit (a Supporting Letter of Credit)
in form and substance satisfactory to the Agent, issued by an issuer
satisfactory to the Agent in its reasonable judgment in an amount equal to 105%
of the greatest amount for which such Letter of Credit may be drawn, under which
Supporting Letter of Credit the Agent shall be entitled to draw amounts
necessary to reimburse the Agent and the Lenders for payments made by the Agent
and the Lenders under such Letter of Credit or under any reimbursement or
guaranty agreement with respect thereto, or (b) Cash Collateral in an amount
necessary to reimburse the Agent and the Lenders for payments made by the Agent
and the Lenders under such Letter of Credit or under any reimbursement or
guaranty agreement with respect thereto. Such Supporting Letter of Credit or
Cash Collateral shall be held by the Agent for the benefit of the Lenders, as
security for, and to provide for the payment of, the Reimbursement Obligations.
In addition, the Agent may at any time after such Event of Default or
Termination Date apply any or all of such Cash Collateral to the payment of any
or all of the Secured Obligations then due and payable. The Cash Collateral
shall be deposited in the Cash Collateral Account or an Investment Account and
shall be administered in accordance with the provisions of Section 5.16.
ARTICLE 4
MONEY MARKET FACILITY
SECTION 4.1 Money Market Loans. Upon the terms and subject to the
conditions of, and in reliance upon the representations and warranties made
under, this Agreement, BankBoston may in its sole and absolute discretion make
Money Market Loans to the Borrower from time to time, from and after the
Effective Date until the Termination Date, as requested by the Borrower in
accordance with the terms of Section 4.2, up to an aggregate principal amount of
Money Market Loans at any time outstanding not to exceed the lesser of (i) the
Money Market Facility and (ii) the Revolving Credit Facility minus the sum of
the Letter of Credit Obligations and the aggregate principal amount of
outstanding Revolving Credit Loans. The Money Market Loans will not reduce
BankBoston's obligation to make available its Ratable share of any Revolving
Credit Loan.
SECTION 4.2 Making Money Market Loans. Upon request of the Borrower,
BankBoston shall promptly notify the Borrower and the Agent of the rate of
interest offered by BankBoston (in addition to the Base Rate) to be applicable
on any Business Day to a proposed Money Market Loan. Requests for Money Market
Loans shall be made not later than 11:00 a.m. on the Business Day of the
proposed Money Market Loan by delivery by telex, telegraph, telecopy or
telephone of notice of request therefor by an Authorized Officer of the Borrower
to the Agent. Each such notice (a Money Market Loan Request) shall specify (i)
the proposed borrowing date and amount of Money Market Loan requested, (ii) the
applicable Money Market Rate, and (iii) the applicable Money Market Loan
Maturity Date, and shall be immediately followed by a written confirmation
thereof by the Borrower in substantially the form of Exhibit C hereto, provided,
that if such written confirmation differs in any material respect from the
action taken by the Agent, the records of the Agent shall control absent
manifest error. Not later than 2:00 p.m. on the date specified for any Money
Market Loan, BankBoston shall make available such Money Market Loan in
immediately available funds to the Agent at the Agent's Office. After the
Agent's receipt of such funds and upon fulfillment of the applicable conditions
set forth in Article 6, the Agent will, and the Borrower hereby irrevocably
authorizes the Agent to, disburse the proceeds of the Money Market Loan made in
respect of each such Loan requested pursuant to this Section 4.2 by making such
funds available to the Borrower by internal or wire transfer to such account of
the Borrower as the Authorized Officer of the Borrower may instruct the Agent
from time to time.
SECTION 4.3 Repayment of Money Market Loans. The principal amount of
each Money Market Loan shall be repaid by the Borrower in full on the applicable
Money Market Loan Maturity Date.
SECTION 4.4 Prepayment. The principal amount of Money Market
Loans may not be prepaid without the prior consent of BankBoston.
SECTION 4.5 Money Market Note. The Money Market Loans made by
BankBoston and the obligation of the Borrower to repay such Loans shall be
evidenced by, and be repayable in accordance with the terms of, a single Money
Market Note, made by the Borrower payable to the order of BankBoston. The Money
Market Note shall be dated the Effective Date and be duly and validly executed
and delivered by the Borrower.
SECTION 4.6 Settlement with Other Lenders. The making of each Money
Market Loan by BankBoston shall be deemed to be a purchase by BankBoston of a
100% participation in each other Lender's Commitment Percentage of the amount of
such Money Market Loan. All payments of principal, interest and any other amount
with respect to such Money Market Loan shall be payable to and received by the
Agent for the account of BankBoston. Upon demand by BankBoston, with notice
thereof to the Agent, and notwithstanding the occurrence and continuation at the
time of such demand of any Default or Event of Default, each other Lender shall
pay to the Agent, for the account of BankBoston, as the repurchase of such
participation, an amount equal to 100% of such Lender's Commitment Percentage of
the principal amount of such Money Market Loans. Any payments received by the
Agent prior to the repurchase of such participation which in accordance with the
terms of this Agreement are to be applied to the reduction of the outstanding
principal balance of Money Market Loans shall be paid over to and retained by
BankBoston for such application, and such payment to and retention by BankBoston
shall be deemed, to the extent of each other Lender's Commitment Percentage of
such payment, to be such a repurchase by each other Lender of such participation
in the Money Market Loans held by BankBoston. The Lenders shall, pursuant to the
provisions of Section 2.2(a), make a Base Rate Loan to fund any such repurchase
pursuant to this Section 4.6.
ARTICLE 5
GENERAL LOAN PROVISIONS
SECTION 5.1 Interest.
(a) Base Rate Loans. Subject to the provisions of Section 5.1(e), the
Borrower will pay interest on the unpaid principal amount of each Base Rate
Loan, for each day from the day such Loan is made until such Loan is paid
(whether at maturity, by reason of acceleration, or otherwise) or is converted
to an Loan of a different Type, at a rate per annum equal to the sum of (i) the
Applicable Margin and (ii) the Base Rate, payable monthly in arrears as it
accrues on each Interest Payment Date.
(b) Eurodollar Rate Loans. Subject to the provisions of Section 5.1(e),
the Borrower will pay interest on the unpaid principal amount of each Eurodollar
Rate Loan for the applicable Interest Period at a rate per annum equal to the
sum of (i) the Applicable Margin and (ii) the Eurodollar Rate, payable in
arrears on the last day of such Interest Period and, if such Interest Period is
longer than three months, at intervals of three months after the first day
thereof, and when such Eurodollar Rate Loan is due (whether at maturity, by
reason of acceleration or otherwise).
(c) Money Market Loans. Subject to the provisions of Section 5.1(e),
the Borrower will pay interest on each Money Market Loan for the period from the
date such Money Market Loan is made until the principal amount thereof is paid,
at a rate per annum equal to the Money Market Rate. Such interest shall be
payable on each Interest Payment Date in respect of each Money Market Loan
outstanding from and after the immediately preceding Interest Payment Date to
such Interest Payment Date and on any other date on which Base Rate Loans or
interest thereon is due.
(d) Other Secured Obligation. The Borrower will, to the extent
permitted by Applicable Law, pay interest on the unpaid principal amount of any
Secured Obligation (other than the Loans) that is due and payable in accordance
with Section 5.1(a) or (e), as applicable, as if such Secured Obligation were a
Base Rate Loan.
(e) Default Rate. If there shall occur and be continuing an Event of
Default, each unpaid amount hereunder shall, at the election of the Agent and
the Required Lenders, no longer bear interest in accordance with the terms of
Section 5.1(a), 5.1(b), 5.1(c) or 5.1(d), but shall bear interest for each day
from the date of such Event of Default until Event of Default shall have been
cured or waived at a rate per annum equal to the sum of (i) the Default Margin
and (ii) the rate otherwise applicable to such amount, payable on demand. The
interest rate provided for in the preceding sentence shall, to the extent
permitted by Applicable Law, apply to and accrue on the amount of any judgment
entered with respect to any Secured Obligation and shall continue to accrue at
such rate during any proceeding described in Section 13.1(g) or (h).
(f) Calculation of Interest. The interest rates provided for in
Sections 5.1(a), (b), (c), (d) and (e) shall be computed on the basis of a year
of 360 days and the actual number of days elapsed. Each interest rate determined
with reference to the Base Rate shall be adjusted automatically as of the
opening of business on the effective date of each change in the Base Rate. Each
change in the Applicable Margin shall become effective on the related Margin
Adjustment Date. Margin Adjustment Date means the date selected by the Agent
that is no later than seven Business Days after receipt by the Agent of the
officer's certificate referred to in Section 11.3(a) delivered with respect to
any fiscal quarter of the Borrower (or any measurement period ending with such
fiscal quarter) that reflects a ratio of Funded Debt to EBITDA or Pricing
Coverage corresponding to an Applicable Margin different from that in effect on
the date of such receipt.
(g) Maximum Rate. It is not intended by the Lenders, and nothing
contained in this Agreement or the Notes shall be deemed, to establish or
require the payment of a rate of interest in excess of the maximum rate
permitted by Applicable Law (the Maximum Rate). If, in any month, the Effective
Interest Rate, absent such limitation, would have exceeded the Maximum Rate,
then the Effective Interest Rate for that month shall be the Maximum Rate, and,
if in future months, the Effective Interest Rate would otherwise be less than
the Maximum Rate, then the Effective Interest Rate shall remain at the Maximum
Rate until such time as the amount of interest paid hereunder equals the amount
of interest which would have been paid if the same had not been limited by the
Maximum Rate. In the event that, upon payment in full of the Secured
Obligations, the total amount of interest paid or accrued under the terms of
this Agreement is less than the total amount of interest which would have been
paid or accrued if the Effective Interest Rate had at all times been in effect,
then the Borrower shall, to the extent permitted by Applicable Law, pay to the
Lenders an amount equal to the excess, if any, of (i) the lesser of (A) the
amount of interest which would have been charged if the Maximum Rate had, at all
times, been in effect and (B) the amount of interest which would have accrued
had the Effective Interest Rate, at all times, been in effect over (ii) the
amount of interest actually paid or accrued under this Agreement. In the event
the Lenders receive, collect or apply as interest any sum in excess of the
Maximum Rate, such excess amount shall be applied to the reduction of the
principal balance of the Secured Obligations, and if no such principal is then
outstanding, such excess or part thereof remaining, shall be paid to the
Borrower. For the purposes of computing the Maximum Rate, to the extent
permitted by applicable law, all interest and charges, discounts, amounts,
premiums or fees deemed to constitute interest under applicable law, shall be
amortized, prorated, allocated and spread in substantially equal parts
throughout the full term of this Agreement. The provisions of this Section
5.1(g) shall be deemed to be incorporated into every Loan Document (whether or
not any provision of this Section 5.1(g) is specifically referred to therein).
SECTION 5.2 Certain Fees.
(a) Agent's Fees. The Borrower shall pay to the Agent an origination
fee and an agent's fee in such amounts, payable at such times as are reflected
in the separate fee letter between the Borrower and BankBoston.
(b) Commitment Fee. In connection with and as consideration for the
holding available for the use of the Borrower hereunder the full amount of the
Revolving Credit Facility, the Borrower will pay a fee to the Agent, for the
Ratable benefit of the Lenders, for each day from the Effective Date until the
Termination Date, in an amount equal to 0.25% per annum (subject to adjustment
on and as of each date on which the Applicable Margin is subject to adjustment,
to rates as set forth on the pricing Matrix attached hereto as Annex B) of the
excess, if any, of the Revolving Credit Facility over the sum of the aggregate
principal amount of Revolving Credit Loans outstanding plus the aggregate Letter
of Credit Amount of all outstanding Letters of Credit (in each case, as of the
date of determination). Such fee shall be calculated based on a year of 360 days
and the actual number of days elapsed, and shall be payable monthly in arrears
on each Interest Payment Date, on the Termination Date and on the date of any
other permanent reduction in the Revolving Credit Facility.
(c) Letter of Credit Fees.
(i) The Borrower agrees to pay to the Agent, for the Ratable
benefit of the Lenders, Letter of Credit fees at a rate per annum equal
to the Applicable Margin in effect as to Eurodollar Rate Loans on the
date of payment on the Letter of Credit Amount of each Letter of Credit
from time to time outstanding during the term of this Agreement. Such
fees shall be payable to the Agent for the Ratable benefit of the
Lenders in advance on the date of issuance or renewal of each Letter of
Credit for the period from such day through the last day of the
calendar quarter in which such payment date falls and thereafter at
three-month intervals on the first day of each January, April, July and
October during the term hereof. Such fees shall be calculated based on
a year of 360 days and the actual number of days elapsed.
(ii) The Borrower agrees to pay to Agent, for the account of
BankBoston, an additional fee at a rate equal to 0.125% per annum of
the Letter of Credit Amount of each Letter of Credit issued or renewed
by BankBoston, payable in full in advance on the date of issuance or
renewal, and the standard fees and charges of BankBoston for issuing,
administering, amending, renewing, paying and canceling letters of
credit, as and when assessed.
(d) General. All fees provided for herein or in the fee letter referred
to in Section 5.2(a) shall be fully earned by the Agent, the Lenders or
BankBoston, as the case may be, when due and payable and, except as otherwise
set forth herein or required by applicable law, shall not be subject to refund
or rebate. All fees are for compensation for services and are not, and shall not
be deemed to be, interest or a charge for the use of money.
SECTION 5.3 Manner of Payment.
(a) Except as otherwise expressly provided in Section 9.1(b), each
payment (including prepayments) by the Borrower on account of the principal of
or interest on the Loans or of any other amounts payable to the Lenders under
this Agreement or any Note shall be made not later than 12:00 noon on the date
specified for payment under this Agreement to the Agent, for the account of the
Lenders, at the Agent's Office, in Dollars, in immediately available funds and
shall be made without any setoff, counterclaim or deduction whatsoever. Any
payment received after such time but before 2:00 p.m. on such day shall be
deemed a payment on such date for the purposes of Section 13.1, but for all
other purposes shall be deemed to have been made on the next succeeding Business
Day.
(b) The Borrower hereby irrevocably authorizes each Lender and each
Affiliate of such Lender and each participant herein to charge any account of
the Borrower maintained with such Lender or such Affiliate or participant with
such amounts as may be necessary from time to time to pay any Secured
Obligations (whether or not owed to such Lender, Affiliate or participant) which
are not paid when due.
SECTION 5.4 General. If any payment under this Agreement or any Note
shall be specified to be made on a day which is not a Business Day, it shall be
made on the next succeeding day which is a Business Day and such extension of
time shall in such case be included in computing interest, if any, in connection
with such payment.
SECTION 5.5 Loan Accounts; Statements of Account.
(a) Each Lender shall open and maintain on its books a loan account in
the Borrower's name (each, a Loan Account and collectively, the Loan Accounts).
Each such Loan Account shall show as debits thereto each Loan made under this
Agreement by such Lender to the Borrower and as credits thereto all payments
received by such Lender and applied to principal of such Loans, so that the
balance of the Loan Account at all times reflects the principal amount due such
Lender from the Borrower.
(b) The Agent shall maintain on its books a control account for the
Borrower in which shall be recorded (i) the amount of each disbursement made
hereunder, (ii) the amount of any principal or interest due or to become due
from the Borrower hereunder, and (iii) the amount of any sum received by the
Agent hereunder from the Borrower and each Lender's share therein.
(c) The entries made in the accounts pursuant to subsections (a) and
(b) shall be prima facie evidence, in the absence of manifest error, of the
existence and amounts of the obligations of the Borrower therein recorded and in
case of discrepancy between such accounts, in the absence of manifest error, the
accounts maintained pursuant to subsection (b) shall be controlling.
(d) The Agent will account separately to the Borrower monthly with a
statement of Loans, charges and payments made to and by the Borrower pursuant to
this Agreement, and such accounts rendered by the Agent shall be deemed final,
binding and conclusive, save for manifest error, unless the Agent is notified by
the Borrower in writing to the contrary within 30 days of the date the account
to the Borrower was so rendered. Such notice by the Borrower shall be deemed an
objection to only those items specifically objected to therein. Failure of the
Agent to render such account shall in no way affect the rights of the Agent or
of the Lenders hereunder.
SECTION 5.6 Reduction of Revolving Credit Facility; Termination of Agreement.
(a) Reduction of Revolving Credit Facility.
(i) The Borrower shall have the right, at any time and from
time to time, upon at least three Business Days' prior irrevocable,
written notice to Agent, to terminate or reduce permanently all or a
portion of the unused Revolving Credit Facility; provided, however,
that any such partial reduction shall be made in increments of
$1,000,000 or an integral multiple thereof and shall not reduce the
Revolving Credit Facility below the amount of the aggregate Letter of
Credit Obligations. As of the date of termination or reduction set
forth in such notice, the Revolving Credit Facility shall be
permanently reduced to the amount stated in the Borrower's notice for
all purposes herein (and each Lender's Commitment shall also be reduced
by such Lender's Commitment Percentage of the amount of such
reduction).
(ii) The amount of the Revolving Credit Facility shall be
automatically reduced to zero on the Termination Date.
(iii) The Revolving Credit Facility or any portion thereof
terminated or reduced pursuant to this Section 5.6 may not be reinstated.
(b) Termination of Agreement. Subject to the provisions of Section 4.4,
the Borrower shall have the right, at any time, to terminate this Agreement upon
not less than two Business Days' prior written notice, which notice shall
specify the effective date of such termination. Upon receipt of such notice, the
Agent shall promptly notify each Lender thereof. On the date specified in such
notice, such termination shall be effected, provided, that the Borrower shall,
on or prior to such date, pay to the Agent, for its account and the account of
the Lenders, in same day funds, an amount equal to all Secured Obligations
(other than with respect to Letter of Credit Obligations) outstanding on such
date, including, without limitation, all (i) accrued interest thereon, (ii) all
accrued fees provided for hereunder, and (iii) any amounts payable to the Lender
pursuant to Sections 5.10, 5.11, 5.16, 16.2, 16.3 and 16.13, and, in addition
thereto, shall deliver to the Agent, in respect of each outstanding Letter of
Credit, either a Supporting Letter of Credit or Cash Collateral as provided in
Section 3.9. Following a notice of termination as provided for in this Section
5.6(b) and upon payment in full of the amounts specified in this Section 5.6(b),
this Agreement shall be terminated and the Agent, the Lenders and the Borrower
shall have no further obligations to any other party hereto, except for the
obligations to the Agent and the Lenders pursuant to Section 16.13 and the
provisions of Section 16.15, which shall survive any termination of this
Agreement.
SECTION 5.7 Making of Loans. The obligations of the Lenders under this
Agreement to make the Loans are several and are not joint or joint and several.
Unless the Agent shall have received notice from a Lender prior to a proposed
Borrowing date that such Lender will not make available to the Agent such
Lender's Proportionate Share of the Revolving Credit Loan to be borrowed on such
date, the Agent may assume that such Lender will make such Proportionate Share
available to the Agent in accordance with Section 2.2(a), and the Agent may, in
reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent such Lender shall not make such
Proportionate Share available to the Agent, such Lender and the Borrower
severally agree to repay to the Agent forthwith on demand such corresponding
amount together with interest thereon for each day from the date such amount is
made available to the Borrower until the date such amount is repaid to the Agent
at (i) if paid by such Lender, the Federal Funds Effective Rate or (ii) if paid
by the Borrower, the Effective Interest Rate or, if lower, subject to Section
5.1(g), the Maximum Rate. If such Lender shall repay to the Agent such
corresponding amount, the amount so repaid shall constitute such Lender's
Proportionate Share of the Loan made on such Borrowing date for purposes of this
Agreement. The failure of any Lender to make its Proportionate Share of any Loan
available shall not (without regard to whether a Borrower shall have returned
the amount thereof to the Agent in accordance with this Section 5.7) relieve it
or any other Lender of its obligation, if any, hereunder to make its
Proportionate Share of the Loan available on such Borrowing date, but no Lender
shall be responsible for the failure of any other Lender to make its
Proportionate Share of a Loan available on the Borrowing date.
SECTION 5.8 Settlement of Secured Obligations. All amounts received by
the Agent on account of, or applied by the Agent to the payment of, any Secured
Obligation owed to the Lenders (including, without limitation, principal and
interest on Revolving Credit Loans, fees payable to the Lenders pursuant to
Sections 5.2(b) and (c) and proceeds from the sale of, or other realization
upon, all or any part of the Collateral following an Event of Default) that are
received by the Agent on or prior to 1:00 p.m. on a Business Day will be paid by
the Agent to each Lender on the same Business Day, and any such amounts that are
received by the Agent after 1:00 p.m. will be paid by the Agent to each Lender
on the following Business Day. Unless otherwise stated herein, the Agent shall
distribute to each Lender such Lender's Proportionate Share of fees payable to
the Lenders pursuant to Sections 5.2(b) and (c) and shall distribute to each
Lender such Lender's Proportionate Share (or if different, such Lender's share
based upon the amount of the Secured Obligations then owing to each Lender) of
the proceeds from the sale of, or other realization upon, all or any part of the
Collateral following an Event of Default.
SECTION 5.9 Mandatory Prepayments. The Borrower shall permanently
reduce the Commitments (Ratably) by an amount equal to any amount that would
otherwise constitute "Excess Proceeds," as defined in the 1997 Indenture,
required by the terms thereof to be applied to the prepayment of Senior Sub
Debt. To the extent necessary to comply with the provisions of Section 2.3(b)
after giving effect to such reduction, the Borrower shall also prepay the Loans.
Any such prepayment pursuant to this Section 5.9 shall be applied first to Money
Market Loans, then to Base Rate Loans to the extent thereof and then to
Eurodollar Rate Loans. If any payments are received which result in prepayment
of Eurodollar Rate Loans prior to the end of the applicable Interest Period or
in repayment of any Money Market Loan prior to its Money Market Loan Maturity
Date, the Borrower shall also pay any amounts due pursuant to Section 5.11 and
any amount certified to the Borrower by BankBoston as the breakage cost
associated with pre-payment of any Money Market Loan.
SECTION 5.10 Changed Circumstances
(a) In the event that:
(i) on any date on which the Eurodollar Rate would otherwise
be set, BankBoston shall have determined in good faith (which
determination shall be final and conclusive) that adequate and
reasonable means do not exist for ascertaining the Eurodollar Rate, or
(ii) the Majority Lenders shall notify the Agent that they
have determined in good faith (which determination shall be final and
conclusive) that the Eurodollar Rate shall no longer represent the
effective cost to the Majority Lenders of making or maintaining
Eurodollar Advances to be made by them, or
(iii) any Lender shall notify the Agent that it has determined
in good faith (which determination shall be final and conclusive) that
the making or continuation of or conversion of any Advance of such
Lender to a Eurodollar Advance has been made impracticable or unlawful
by (A) the occurrence of a contingency that materially and adversely
affects the interbank Eurodollar market or (B) compliance by such
Lender in good faith with any Applicable Law or interpretation or
change thereof by any governmental authority charged with the
interpretation or administration thereof or with any request or
directive of any such governmental authority (whether or not having the
force of law);
then, and in any such event, the Agent shall forthwith so notify the Borrower
thereof and:
(A) Until the Agent notifies the Borrower that the
circumstances giving rise to any notice given pursuant to
Section 5.10(a) no longer apply, the obligation of the Lenders
to allow selection by the Borrower of Eurodollar Advances
shall be suspended. If at the time the Agent so notifies the
Borrower, the Borrower has previously given the Agent a Notice
of Borrowing or a Notice of Conversion or Continuation with
respect to one or more Borrowings to be made as or to be
converted into or continued as Borrowings comprised of
Eurodollar Advances (each, a Pending Borrowing) but such
Pending Borrowings have not yet been so made, converted or
continued, each such Notice shall be deemed to be an election
by the Borrower of Borrowings comprised of Base Rate Advances.
(B) On such date as is specified in any notice to the
Borrower from the Agent pursuant to Section 5.10(a) (which
date shall not be earlier than the date such notice is given),
the Borrower shall prepay the outstanding principal amount of
all Eurodollar Advances, together with interest thereon and
any amount required to be paid pursuant to Section 5.11, or
convert all such outstanding Eurodollar Advances into Base
Rate Advances by giving a Notice of Conversion or Continuation
pursuant to Section 5.13.
(b) In case of any change in law, regulation, treaty or official
directive or the interpretation or application thereof by any court or by any
governmental authority charged with the administration thereof or the compliance
with any guideline or request of any central bank or other governmental
authority (whether or not having the force of law):
(i) subjects any Lender to any tax with respect to payments of
principal or interest or any other amounts payable hereunder by the
Borrower or otherwise with respect to the transactions contemplated
hereby (except for taxes on the overall net income of such Lender
imposed by the United States of America or any political subdivision
thereof), or
(ii) imposes, modifies or deems applicable any deposit
insurance, reserve, special deposit or similar requirement against
assets held by, or deposits in or for the account of, or loans by, any
Lender (other than the Reserve Percentage), or
(iii) imposes upon any Lender any other condition with respect
to its performance under this Agreement,
and the result of any of the foregoing is to increase the cost to such Lender,
reduce the income receivable by such Lender or impose any expense upon such
Lender with respect to any Advances, such Lender shall notify the Agent and the
Borrower thereof. The Borrower agrees to pay to such Lender the amount of such
increase in cost, reduction in income or additional expense as and when such
cost, reduction or expense is incurred or determined, upon presentation by such
Lender of a statement of the amount and setting forth such Lender's calculation
thereof, which statement shall be deemed true and correct absent manifest error,
provided, that no Lender shall be entitled to charge nor shall the Borrower be
obligated to pay any such amount relating to a period more than 90 days prior to
the date on which such statement is presented.
(c) If any lender determines that (i) the adoption of or change in, in
each case after the date hereof, any law, rule, regulation or guideline
regarding capital requirements for banks or bank holding companies, or any
change after the date hereof in the interpretation or application thereof by any
governmental authority charged with the administration thereof, or (ii)
compliance by such Lender with any guideline, request or directive of any such
entity regarding capital adequacy (whether or not having the force of law)
promulgated after the date hereof, has the effect of reducing the return on such
Lender's capital as a consequence of its Commitment to make Advances hereunder
to a level below that which such Lender could have achieved but for such
adoption, change or compliance (taking into consideration such Lender's
then-existing policies with respect to capital adequacy and assuming the full
utilization of such Lender's capital) by any amount deemed by such Lender to be
material, then such Lender shall notify the Agent and the Borrower thereof. The
Borrower agrees to pay to such Lender the amount of such reduction of capital as
and when such reduction is determined, upon presentation by such Lender of a
statement of the amount and setting forth such Lender's calculation thereof,
which statement shall be deemed true and correct absent manifest error,
provided, that no Lender shall be entitled to charge nor shall the Borrower be
required to pay any such amount relating to a period more than 90 days prior to
the date on which such statement is presented. In determining such amount, a
Lender may use any reasonable averaging and attribution methods.
SECTION 5.11 Payments Not at End of Interest Period; Failure to Borrow.
If for any reason any payment of principal with respect to any Eurodollar Rate
Loan is made on any day prior to the last day of the Interest Period applicable
to such Eurodollar Rate Loan or, after having given a Notice of Borrowing with
respect to any Eurodollar Rate Loan or a Notice of Conversion or Continuation
with respect to any Loan to be continued as or converted into a Eurodollar Rate
Loan, such Loan is not made or is not continued as or converted into a
Eurodollar Rate Loan due to the Borrower's failure to borrow or to fulfill the
applicable conditions set forth in Article 6, the Borrower shall pay to each
Lender, in addition to any amounts that may be due under Section 5.10, an amount
(if a positive number) computed pursuant to the following formula:
L = (R - T) x P x D
360
L = amount payable
R = Adjusted Eurodollar Rate applicable to the Eurodollar Rate Loan
unborrowed or prepaid T = effective interest rate per annum at which
any readily marketable bonds or other obligations of the United
States, selected at the Agent's sole discretion,
maturing on or near the last day of the then
applicable or requested Interest Period for such Loan
and in approximately the same amount as such Loan,
can be purchased by such Lender on the day of such
payment of principal or failure to borrow
P = the amount of principal paid or the amount of the
requested Loan
D = the number of days remaining in the Interest Period
as of the date of such payment or the number of days
in the requested Interest Period
The Borrower shall pay such amount upon presentation by the Agent of a statement
setting forth the amount and the Agent's calculation thereof pursuant hereto,
which statement shall be deemed true and correct absent manifest error.
SECTION 5.12 Assumptions Concerning Funding of Eurodollar Rate Loans.
Calculation of all amounts payable to the Lenders under this Article 5 shall be
made as though each Lender had actually funded or committed to fund its
Eurodollar Rate Loans through the purchase of an underlying deposit in an amount
equal to the amount of such ratable share and having a maturity comparable to
the relevant Interest Period for such Eurodollar Rate Loan; provided, however,
each Lender may fund its Eurodollar Rate Loans in any manner it deems fit and
the foregoing assumption shall be utilized only for the calculation of amounts
payable under this Article 5.
SECTION 5.13 Notice of Conversion or Continuation. Provided that no
Event of Default shall have occurred and be continuing (but subject to the
provisions of Section 5.10), the Borrower may request that all or any part of
any outstanding Loan be converted into a Loan or Loans of a different Type or be
continued as a Loan or Loans of the same Type, in the same aggregate principal
amount, on any Business Day (which, in the case of continuation of a Eurodollar
Rate Loan, shall be the last day of the Interest Period applicable to such
Loan), upon notice (which notice shall be irrevocable) given in accordance with
this Section 5.13. Whenever the Borrower desires to convert an outstanding Loan
into a Loan or Loans of a different Type or to continue all or a portion of an
outstanding Eurodollar Rate Loan for a subsequent Interest Period, the Borrower
shall notify the Agent in writing (which notice shall be irrevocable) by
telecopy not later than 11:30 a.m. on the date three Business Days before the
day on which such proposed conversion or continuation is to be effective (and
such effective date of any continuation shall be the last day of the Interest
Period for the Eurodollar Rate Loan). Each such notice (a Notice of Conversion
or Continuation) shall (i) identify the Loan to be converted or continued, the
aggregate outstanding principal balance thereof and, if a Eurodollar Rate Loan,
the last day of the Interest Period applicable to such Loan, (ii) specify the
effective date of such conversion or continuation, (iii) specify the principal
amount of such Loan to be converted or continued and, if converted, the Type or
Types into which the same is to be converted, and (iv) the Interest Period to be
applicable to the Eurodollar Rate Loan as converted or continued, and shall be
immediately followed by a written confirmation thereof by the Borrower in a form
acceptable to the Agent, provided that if such written confirmation differs in
any respect from the action taken by the Lenders, the records of the Agent shall
control absent manifest error.
SECTION 5.14 Duration of Interest Periods; Maximum Number of Eurodollar
Rate Loans; Minimum Increments; Maximum Number of Money Market Loans.
(a) Subject to the provisions of the definition Interest Period, the
duration of each Interest Period applicable to a Eurodollar Rate Loan shall be
as specified in the applicable Notice of Borrowing or Notice of Conversion or
Continuation. The Borrower may elect a subsequent Interest Period to be
applicable to any Eurodollar Rate Loan by giving a Notice of Conversion or
Continuation with respect to such Loan in accordance with Section 5.13.
(b) If the Agent does not receive a notice of election in accordance
with Section 5.13 with respect to the continuation of Eurodollar Rate Loan
within the applicable time limits specified in said Section 5.13, or if, when
such notice must be given, an Event of Default exists or such Type of Loan is
not available, the Borrower shall be deemed to have elected to convert such
Eurodollar Rate Loan in whole into a Base Rate Loan on the last day of the
Interest Period therefor.
(c) Notwithstanding the foregoing, the Borrower may not select an
Interest Period that would end, but for the provisions of the definition
Interest Period, after the Termination Date.
(d) In no event shall there be more than 10 Eurodollar Rate Loans
outstanding hereunder at any time. For purposes of this subsection (d), each
Eurodollar Rate Loan having a distinct Interest Period shall be deemed to be a
separate Loan hereunder.
(e) Each Eurodollar Rate Loan shall be in the amount of $5,000,000
or an integral multiple of $500,000 in excess thereof.
(f) In no event shall there be more than five Money Market Loans
outstanding hereunder at any time.
SECTION 5.15 Replacement of Lender In the event that any Lender makes a
demand for payment pursuant to Section 5.10, or terminates the Commitment of the
Lender to make Eurodollar Rate Loans or to convert Base Rate Loans to Eurodollar
Rate Loans pursuant to Section 5.10, the Borrower shall have the right, if no
Default or Event of Default then exists, to replace such Lender in accordance
with this Section 5.15. If the Borrower determines to replace such Lender, the
Borrower shall have the right to replace such Lender with an entity that is an
Eligible Assignee (a Replacement Lender); provided that such Replacement Lender,
(i) shall obtain the consent of the Agent, such consent not to be unreasonably
withheld, (ii) shall unconditionally offer in writing (with a copy to the Agent)
to purchase all of such Lender's rights and obligations under this Agreement and
the Loan Documents as of the date specified in the Assignment and Acceptance
(including, without limitation, the assigning Lender's Commitment as then in
effect, the assigning Lender's obligations in respect of the Letter of Credit
Facility, the Loans owing to the assigning Lender and the Notes held by the
assigning Lender), in each case without recourse, at the principal amount
thereof plus interest and fees accrued thereon to the date of such purchase on a
date therein specified, (iii) shall execute and deliver to the Agent an
Assignment and Acceptance and (iv) shall comply with all the terms and
conditions set forth in Sections 14.1(b) and 14.1(c), including payment to the
Agent of the amount set forth in Section 14.1(b) (iv). Upon satisfaction of the
requirements set forth in the second sentence of this Section 5.15, acceptance
of such offer to purchase by the Lender to be replaced, payment to such Lender
of the purchase price in immediately available funds, and the payment by the
Borrower of all requested costs accruing to the date of purchase which the
Borrower is obligated to pay under Sections 14.1(b) (iv), 16.2 and 16.13 (if
any) and all other amounts owed by the Borrower to such Lender (including any
amounts owing pursuant to Section 5.10 but excluding principal of and interest
on the Notes and reimbursement obligations relating to the Letters of Credit of
such Lender purchased by the Replacement Lender) and execution of the Assignment
and Acceptance by all parties thereto in accordance with Section 14.1 hereof,
the Replacement Lender shall constitute a "Lender" hereunder with a Commitment
as so specified and the Lender being so replaced shall no longer constitute a
"Lender" hereunder and shall thereupon be released from any and all liabilities
in respect of this Agreement and the other Loan Documents. If, however, (x) a
Lender accepts such an offer and such proposed Replacement Lender fails to
purchase such rights and interests on such specified date in accordance with the
terms of such offer and this Section 5.15 and to execute an Assignment and
Acceptance, the Borrower shall continue to be obligated to pay the increased
costs or additional amounts due to such Lender pursuant to Section 5.10 or
Eurodollar Rate Loans shall be terminated or not renewed as determined by such
Lender, as the case may be, or (y) the Lender proposed to be replaced fails to
accept such purchase offer, the Borrower shall not be obligated to pay to such
Lender such increased costs or additional amounts pursuant to Section 5.10
incurred or accrued from and after the date of such purchase offer but shall be
obligated to and shall pay any such increased costs or additional amounts
incurred or accrued prior to the date of such purchase offer.
SECTION 5.16 Cash Collateral Account. The Borrower shall upon request
by the Agent establish a Cash Collateral Account in which to deposit Collateral
consisting of cash or Cash Equivalents from time to time
(a) with respect to Letter of Credit Obligations (i) at the request of
the Agent upon the occurrence of an Event of Default, or (ii) for the purposes
set forth in Sections 3.9 and 5.6 in the event of termination of this Agreement,
or
(b) for any other purpose appropriate under this Agreement to provide
security for the Secured Obligations.
If a drawing under a Letter of Credit occurs with respect to any amounts
deposited to the Cash Collateral Account pursuant to clause (a) above, the
Borrower hereby authorizes the Agent to use the monies deposited in the Cash
Collateral Account to make payment to the payee with respect to such drawing.
The Cash Collateral Account shall be in the name of the Agent and the Agent
shall have sole dominion and control over, and sole access to, the Cash
Collateral Account. Neither the Borrower nor any Person claiming on behalf of or
through the Borrower shall have any right to withdraw any of the funds held in
the Cash Collateral Account. The Borrower agrees that it will not at any time
(x) sell or otherwise dispose of any interest in the Cash Collateral Account or
any funds held therein or (y) create or permit to exist any Lien upon or with
respect to the Cash Collateral Account or any funds held therein, except as
provided in or contemplated by this Agreement. The Agent shall exercise
reasonable care in the custody and preservation of any funds held in the Cash
Collateral Account and shall be deemed to have exercised such care if such funds
are accorded treatment substantially equivalent to that which the Agent accords
other funds deposited with the Agent, it being understood that the Agent shall
not have any responsibility for taking any necessary steps to preserve rights
against any parties with respect to any funds held in the Cash Collateral
Account. Subject to the right of the Agent to withdraw funds from the Cash
Collateral Account as provided herein, the Agent will, so long as no Default or
Event of Default shall have occurred and be continuing, from time to time invest
funds on deposit in the Cash Collateral Account, reinvest proceeds of any such
investments which may mature or be sold, and invest interest or other income
received from any such investments, in each case, in Cash Equivalents, as the
Borrower may direct prior to the occurrence of a Default or Event of Default and
as the Agent may select after the occurrence and during the continuance of a
Default or Event of Default. Such proceeds, interest and income which are not so
invested or reinvested in Cash Equivalents shall be deposited and held by the
Agent in the Cash Collateral Account. The Agent makes no representation or
warranty as to, and shall not be responsible for, the rate of return, if any,
earned in any Cash Collateral. Any earnings on Cash Collateral shall be held as
additional Cash Collateral on the terms set forth in this Section 5.16.
ARTICLE 6
CONDITIONS PRECEDENT
SECTION 6.1 Conditions Precedent to Loans. Notwithstanding any other
provision of this Agreement, the obligations of the Lenders to make the Initial
Loans hereunder is subject to the satisfaction of each of the following
conditions, prior to or contemporaneously with the making of the first such
Loans:
(a) Closing Documents. The Agent shall have received each of the
following, all of which shall be satisfactory in form and substance to the Agent
and its special counsel:
(1) this Agreement, duly executed and delivered by the
Borrower and each Lender;
(2) the Notes, each dated the Effective Date and duly executed
and delivered by the Borrower;
(3) certified copies of the certificate of incorporation and
by-laws of the Borrower as in effect on the Effective Date and all
corporate action, including shareholder approval, if necessary, taken
by the Borrower and/or its shareholders to authorize the execution,
delivery and performance of this Agreement and the other Loan Documents
and the Borrowings under this Agreement;
(4) certificates of incumbency and specimen signatures with
respect to each of the officers of the Borrower who is authorized to
execute and deliver this Agreement or any other Loan Document on behalf
of the Borrower or any document, certificate or instrument to be
delivered in connection with this Agreement or the other Loan Documents
and to request Borrowings under this Agreement;
(5) a certificate evidencing the good standing of the Borrower
in the jurisdiction of its incorporation and in each other jurisdiction
in which it is qualified as a foreign corporation to transact business;
(6) the Financing Statements duly executed and delivered by
the Borrower, and evidence satisfactory to the Agent that the Financing
Statements have been filed in each jurisdiction where such filing may
be necessary or appropriate to perfect the Security Interest;
(7) landlord's waiver and consent agreements duly executed on
behalf of each landlord and mortgagee's waiver and consent agreements
duly executed on behalf of each mortgagee, in each case of real
property on which any Collateral is located, as the Agent may request;
(8) a Schedule of Inventory prepared as of a recent date;
(9) certificates or binders of insurance relating to each of
the policies of insurance covering any of the Collateral together with
loss payable clauses which comply with the terms of Section 9.6(b);
(10) an Initial Notice of Borrowing from the Borrower to the
Agent requesting the Initial Loans and specifying the method of
disbursement;
(11) copies of all the financial statements referred to in
Section 7.1(n) and meeting the requirements thereof;
(12) a certificate of the President of the Borrower stating
that, to the best of his knowledge and based on an examination
sufficient to enable him to make an informed statement, (a) all of the
representations and warranties made or deemed to be made under this
Agreement are true and correct as of the Effective Date, both with and
without giving effect to the Loans to be made at such time and the
application of the proceeds thereof, and (b) no Default or Event of
Default exists;
(13) a signed payoff letter from BankBoston, N.A., as agent
under the Existing Credit Agreement, and evidence satisfactory to the
Agent of the release and termination of (or agreement(s) to release and
terminate) all Liens other than Permitted Liens;
(14) a certification from an Authorized Officer of the
Borrower as to such factual matters as shall be required by the Agent;
(15) signed opinions of Xxxxxx, Xxxx & Xxxxxxxx and Xxxx &
Spalding, counsel for the Borrower and Funding, and of such local
counsel as the Agent shall deem necessary or desirable, opining as to
such matters in connection with this Agreement, the 1997 Indenture and
the Securitization as the Agent or any Lender may reasonably request;
(16) the Patent Assignment duly executed and delivered by
the Borrower;
(17) the Trademark Assignment duly executed and delivered
by the Borrower;
(18) the Pledge Agreement, duly executed by the Borrower,
accompanied by certificates, in form for transfer by delivery or
accompanied by duly executed stock powers, undated, in blank,
representing 100% of the issued and outstanding shares of capital stock
of each United States Subsidiary and 66-2/3% of the issued and
outstanding shares of capital stock of each Foreign Subsidiary;
(19) an assignment of the Borrower's right, title and interest
in and to the Borrower RPA, duly executed by the Borrower and
acknowledged by Funding; and
(20) copies of each of the other Loan Documents duly executed
by the parties thereto with evidence satisfactory to the Lender and its
counsel of the due authorization, binding effect and enforceability of
each such Loan Document on each such party and such other documents and
instruments as the Agent may reasonably request.
(b) Subsidiary Guarantor Documents. The Agent shall have received each
of the following documents, all of which shall be satisfactory in form and
substance to the Agent and its special counsel and to the Lenders, with respect
to any Subsidiary Guarantor:
(1) certified copies of the articles or certificate of
incorporation and bylaws of such Subsidiary Guarantor as in effect on
the Effective Date;
(2) certified copies of all corporate action, including
shareholder approval, if necessary, taken by such Subsidiary Guarantor
to authorize the execution, delivery and performance of the Subsidiary
Guaranty and any Subsidiary Guarantor security documents;
(3) certificates of incumbency and specimen signatures with
respect to each of the officers of such Subsidiary Guarantor authorized
to execute and deliver the Subsidiary Guaranty and any Subsidiary
Guarantor security documents on behalf of such Subsidiary Guarantor;
(4) a certificate evidencing the good standing of such
Subsidiary Guarantor in the jurisdiction of its incorporation and in
each other jurisdiction in which it is required to be qualified as a
foreign corporation to transact its business as presently conducted;
(5) the Subsidiary Guaranty, duly executed and delivered by
such Subsidiary Guarantor; and
(6) such other documents and instruments as the Agent may
reasonably request.
(c) Fees. The Borrower shall have paid all of the fees payable on the
Effective Date referred to herein.
(d) Securitization. The Agent shall have received evidence satisfactory
to it that: the Securitization Documents have been executed and delivered as to
a program amount of at least $40,000,000 and otherwise in form and substance
satisfactory to the Agent and the Lenders by all parties thereto; all material
conditions to the initial Purchase under and as defined in each of the Borrower
RPA and the Investor RPA have been satisfied without any waiver thereof;
satisfactory legal opinions of counsel to the Borrower, on which the Agent and
the Lenders shall be entitled to rely, have been delivered as part of the
Securitization Documents.
(e) Security Interests. The Agent shall have received satisfactory
evidence that the Agent (for the benefit of Lenders) has a valid and perfected
first priority security interest as of such date in all of the Collateral,
subject only to Permitted Liens.
(f) No Material Adverse Change. As of the Effective Date, no change
shall have occurred which is materially adverse to the assets, liabilities,
businesses, operations, condition (financial or otherwise) or prospects of the
Borrower and its Consolidated Subsidiaries taken as a whole from those presented
by the unaudited financial statements for the Borrower and its Consolidated
Subsidiaries as of June 30, 1997 and for the nine-month period ended on such
date, copies of which have been delivered to Lenders, and the Agent shall be
provided with a certificate of the Chief Financial Officer to such effect.
SECTION 6.2 All Loans; Letters of Credit. At the time of making of each
Loan, including the Loans constituting the Initial Loans and all subsequent
Loans, and the issuance of each Letter of Credit:
(a) all of the representations and warranties made or deemed to be made
under this Agreement shall be true and correct at such time both with and
without giving effect to the Loans to be made at such time and the application
of the proceeds thereof, and
(b) the corporate actions of the Borrower referred to in Section
6.1(a)(3) shall remain in full force and effect and the incumbency of officers
shall be as stated in the certificates of incumbency delivered pursuant to
Section 6.1(a)(4) or as subsequently modified and reflected in a certificate of
incumbency delivered to the Agent.
Each request or deemed request for any borrowing hereunder shall be deemed to be
a certification by the Borrower to the Agent and the Lenders as to the matters
set forth in Section 6.2(a) and (b) and the Agent may, without waiving either
condition, consider the conditions specified in Sections 6.2(a) and (b)
fulfilled and a representation by the Borrower to such effect made, if no
written notice to the contrary is received by the Agent prior to the making of
the Loan then to be made.
SECTION 6.3 Conditions as Covenants. In the event that the Lenders make
the Initial Loans or a Letter of Credit is issued prior to the satisfaction of
all conditions precedent set forth in Section 6.1, and such conditions are not
waived in writing by the Agent, the Borrower shall nevertheless cause such
condition or conditions to be satisfied within 30 days after the making of such
Initial Loans or the issuance of such Letter of Credit.
ARTICLE 7
REPRESENTATIONS AND WARRANTIES OF BORROWER
SECTION 7.1 Representations and Warranties. The Borrower represents
and warrants to the Agent and to the Lenders as follows:
(a) Organization; Power; Qualification. The Borrower and each of its
Subsidiaries is a corporation, duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation, having the power
and authority to own its properties and to carry on its business as now being
and hereafter proposed to be conducted and is duly qualified and authorized to
do business in each jurisdiction in which the character of its properties or the
nature of its business requires such qualification or authorization. The
jurisdictions in which each of the Borrower and each of its Subsidiaries is
qualified to do business as a foreign corporation are listed on Schedule 7.1(a).
(b) Capitalization; Shareholder Agreements. The outstanding capital
stock of the Borrower has been duly and validly issued and is fully paid and
nonassessable, and each owner of 5% or more of such shares of capital stock of
the Borrower is as set forth on Schedule 7.1(b). The issuance and sale of the
Borrower's capital stock have been registered or qualified under applicable
federal and state securities laws or are exempt therefrom. Except as set forth
on Schedule 7.1(b), there are no shareholders agreements, options, subscription
agreements or other agreements or understandings to which the Borrower is a
party in effect with respect to the capital stock of the Borrower, including,
without limitation, agreements providing for special voting requirements or
arrangements for approval of corporate actions or other matters relating to
corporate governance or restrictions on share transfer or providing for the
issuance of any securities convertible into shares of the capital stock of the
Borrower, any warrants or other rights to acquire any shares or securities
convertible into such shares, or any agreement that obligates the Borrower,
either by its terms or at the election of any other Person, to repurchase such
shares under any circumstances.
(c) Subsidiaries. Schedule 7.1(c) correctly sets forth the name of each
Subsidiary of the Borrower, its jurisdiction of incorporation, the name of its
immediate parent or parents, and the percentage of its issued and outstanding
securities owned by the Borrower or any other Subsidiary of the Borrower and
indicating whether such Subsidiary is a Consolidated Subsidiary. Except as set
forth on Schedule 7.1(c),
(i) no Subsidiary of the Borrower has issued any securities
convertible into shares of such Subsidiary's capital stock or any
options, warrants or other rights to acquire any shares or securities
convertible into such shares,
(ii) the outstanding stock and securities of each Subsidiary
of the Borrower are owned by the Borrower or a Wholly Owned Subsidiary
of the Borrower, or by the Borrower and one or more of its Wholly Owned
Subsidiaries, free and clear of all Liens, warrants, options and rights
of others of any kind whatsoever, and
(iii) the Borrower has no Subsidiaries.
The outstanding capital stock of each Subsidiary of the Borrower has been duly
and validly issued and is fully paid and nonassessable by the issuer, and the
number and owners of the shares of such capital stock are set forth on Schedule
7.1(c).
(d) Authorization of Agreement, Notes, Loan Documents and Borrowing.
The Borrower has the right and power, and has taken all necessary action to
authorize it, to execute, deliver and perform this Agreement and each of the
Loan Documents in accordance with their respective terms. This Agreement and
each of the Loan Documents have been duly executed and delivered by the duly
authorized officers of the Borrower and each is, or each when executed and
delivered in accordance with this Agreement will be, a legal, valid and binding
obligation of the Borrower, enforceable in accordance with its terms.
(e) Compliance of Agreement, Notes, Loan Documents and Borrowing with
Laws, Etc. Except as set forth on Schedule 7.1(e), the execution, delivery and
performance of this Agreement and each of the Loan Documents in accordance with
their respective terms and the borrowings hereunder do not and will not, by the
passage of time, the giving of notice or otherwise,
(i) require any Governmental Approval or violate any
Applicable Law relating to the Borrower or any of its Subsidiaries,
(ii) conflict with, result in a breach of or constitute a
default under the articles or certificate of incorporation, by-laws or
any shareholders agreement of the Borrower or any of its Subsidiaries,
(iii) conflict with, result in a breach of or constitute a
default under any material provisions of any indenture (including,
without being limited to, the 0000 Xxxxxxxxx), agreement or other
instrument to which the Borrower or any of its Subsidiaries is a party
or by which the Borrower, any of its Subsidiaries or any of the
Borrower's or such Subsidiaries' property may be bound or any
Governmental Approval relating to the Borrower or any of its
Subsidiaries, or
(iv) result in or require the creation or imposition of any
Lien upon or with respect to any property now owned or hereafter
acquired by the Borrower other than the Security Interest.
(f) Business. As of the Agreement Date, the Borrower and its
Subsidiaries are engaged principally in the business of converting polypropylene
resins into woven and non-woven, non-apparel textile products.
(g) Compliance with Law; Governmental Approvals.
(i) Except as set forth in Schedule 7.1(g), the Borrower
and each of its Subsidiaries
(A) has all Governmental Approvals, including permits
relating to federal, state and local Environmental Laws,
ordinances and regulations, required by any Applicable Law for
it to conduct its business, each of which is in full force and
effect, is final and not subject to review on appeal and is
not the subject of any pending or, to the knowledge of the
Borrower, threatened attack by direct or collateral
proceeding, and
(B) is in compliance with each Governmental Approval
applicable to it and in compliance with all other
Applicable Laws relating to it, including, without
being limited to, all Environmental Laws and all
occupational health and safety laws applicable to the
Borrower, any of its Subsidiaries or their respective
properties,
except for instances of noncompliance which could not, singly or in the
aggregate, reasonably be expected to cause a Default or Event of
Default or have a Materially Adverse Effect and in respect of which any
reserves required in accordance with GAAP in respect of the Borrower's
or such Subsidiary's reasonably anticipated liability have been
established on the books of the Borrower or such Subsidiary, as
applicable.
(ii) Without limiting the generality of the above, except with
respect to matters which could not reasonably be expected to have,
singly or in the aggregate, a Materially Adverse Effect:
(A) the operations of the Borrower and each of its
Subsidiaries comply in all material respects with all
applicable environmental, health and safety requirements of
Applicable Law;
(B) the Borrower and each of its Subsidiaries has
obtained all environmental, health and safety permits
necessary for its operation, and all such permits are in good
standing and the Borrower and each of its Subsidiaries is in
compliance in all material respects with all terms and
conditions of such permits;
(C) neither the Borrower nor any of its Subsidiaries
nor any of their respective present or past property or
operations are subject to any order from or agreement with any
public authority or private party respecting (x) any
environmental, health or safety requirements of Applicable
Law, (y) any Remedial Action, or (z) any liabilities and costs
arising from the Release or threatened Release of a
Contaminant into the environment;
(D) except in compliance in all material respects
with applicable Environmental Laws, during the course of the
Borrower's or any of its Subsidiaries' ownership of or
operations on the Real Estate, there has been no (1)
generation, treatment, recycling, storage or disposal of
hazardous waste, as that term is defined under 40 CFR Part 261
or any state equivalent, (2) use of underground storage tanks
or surface impoundments, (3) use of asbestos-containing
materials, or (4) use of polychlorinated biphenyls (PCBs) used
in hydraulic oils, electrical transformers or other equipment;
and
(E) no Environmental Lien has attached to any of the
Real Estate or other property of the Borrower or of any of its
Subsidiaries;
(iii) The Borrower has notified the Lenders and the Agent of
the receipt by the Borrower or by any of its Subsidiaries of any notice
of a material violation of any Environmental Laws and occupational
health and safety laws applicable to the Borrower, any of its
Subsidiaries or any of their respective properties.
(h) Title to Properties. Except as set forth in Schedule 7.1(h), the
Borrower and each of its Subsidiaries has valid and marketable legal title to or
a valid leasehold interest in all personal property, Real Estate owned and other
assets used in its business, including, but not limited to, those reflected on
the most recent balance sheet of the Borrower delivered pursuant to Section
7.1(n).
(i) Liens. Except as set forth in Schedule 7.1(i), none of the
properties and assets of the Borrower or any Subsidiary of the Borrower is
subject to any Lien, except Permitted Liens. Other than the Financing
Statements, no financing statement under the Uniform Commercial Code of any
State or other instrument evidencing a Lien which names the Borrower or any
Subsidiary of the Borrower as debtor has been filed (and has not been
terminated) in any State or other jurisdiction, and neither the Borrower nor any
Subsidiary of the Borrower has signed any such financing statement or other
instrument or any security agreement authorizing any secured party thereunder to
file any such financing statement or instrument, except as contemplated by the
Securitization Documents and to perfect those Liens listed on Schedule 7.1(i).
(j) Debt and Guaranties. Schedule 7.1(j) is a complete and correct
listing of all (i) Debt and (ii) Guaranties of each of the Borrower and each of
its Subsidiaries. Each of the Borrower and its Subsidiaries has performed and is
in compliance with all of the terms of such Debt and Guaranties and all
instruments and agreements relating thereto, and no default or event of default,
or event or condition which with notice or lapse of time, or both, would
constitute such a default or event of default, exists with respect to any such
Debt or Guaranty.
(k) Litigation. Except as set forth on Schedule 7.1(k), there are no
actions, suits or proceedings pending (nor, to the knowledge of the Borrower,
are there any actions, suits or proceedings threatened) against or in any other
way relating to or affecting the Borrower or its Subsidiaries or any of the
Borrower's or any of its Subsidiaries' other properties in any court or before
any arbitrator of any kind or before or by any governmental body, except
actions, suits or proceedings of the character normally incident to the kind of
business conducted by the Borrower or any of its Subsidiaries which, if
adversely determined, could not singly or in the aggregate reasonably be
expected to have a Materially Adverse Effect, and there are no strikes or
walkouts in progress, pending or contemplated relating to any labor contracts to
which the Borrower or any of its Subsidiaries is a party, relating to any labor
contracts being negotiated, or otherwise.
(l) Tax Returns and Payments. Except as set forth on Schedule 7.1(l),
all United States federal, state and local as well as foreign national,
provincial and local and other tax returns of the Borrower and each of its
Subsidiaries required by Applicable Law to be filed have been duly filed, and
all United States federal, state and local and foreign national, provincial and
local and other taxes, assessments and other governmental charges or levies upon
the Borrower and each of its Subsidiaries and the Borrower's and any of its
Subsidiaries' property, income, profits and assets which are due and payable
have been paid, except any such nonpayment which is at the time permitted under
Section 10.6. The charges, accruals and reserves on the books of the Borrower
and each of its Subsidiaries in respect of United States federal, state and
local and foreign national, provincial and local taxes for all fiscal years and
portions thereof since the organization of the Borrower are in the judgment of
the Borrower adequate, and the Borrower knows of no reason to anticipate any
additional assessments for any of such years which, singly or in the aggregate,
could reasonably to expect to have a Materially Adverse Effect.
(m) Burdensome Provisions. Neither the Borrower nor any of its
Subsidiaries is a party to any indenture, agreement, lease or other instrument,
or subject to any charter or corporate restriction, Governmental Approval or
Applicable Law compliance with the terms of which could reasonably be expected
to have a Materially Adverse Effect.
(n) Financial Statements.
(i) The Borrower has furnished to the Agent and the Lenders
(A) copies of the Borrower's audited consolidated balance sheet as at
September 30, 1996, and the related audited consolidated statements of
income and cash flow for the fiscal year of the Borrower then ended
reported on by Deloitte & Touche LLP, which financial statements
present fairly in all material respects in accordance with GAAP
consistently applied the financial position of the Borrower and its
Consolidated Subsidiaries as at September 30, 1996, and the results of
operations of the Borrower and its Consolidated Subsidiaries for the
fiscal year of the Borrower then ended and (B) copies of the Borrower's
unaudited consolidated balance sheet as at June 30, 1997, and the
related unaudited consolidated statements of income and cash flow for
the nine-month period then ended, which financial statements present
fairly in all material respects in accordance with GAAP consistently
applied the financial position of the Borrower and its Consolidated
Subsidiaries as at June 30, 1997 and the results of operations of the
Borrower and its Consolidated Subsidiaries for the nine-month period
then ended.
(ii) The Borrower has furnished to the Agent and the Lenders
copies of the Projections. The Projections have been prepared by the
Borrower in light of the past operations of the business of the
Borrower and its Subsidiaries and represent as of the respective dates
thereof the good faith opinion of the Borrower and its senior
management concerning the most probable course of business of the
Borrower and its Subsidiaries.
(iii) Except as disclosed or reflected in the financial
statements described in clause (i) above, the Borrower does not have
any material liabilities, contingent or otherwise, and there were no
material unrealized or anticipated losses of the Borrower.
(o) Material Adverse Change. Since June 30, 1997,
(i) no material adverse change has occurred in the business,
assets, liabilities, financial condition, results of operations or
business prospects of the Borrower and its Subsidiaries taken as a
whole, and
(ii) no event has occurred or failed to occur which has had,
or may have, singly or in the aggregate, a Materially Adverse Effect.
(p) ERISA. Neither the Borrower nor any Related Company maintains or
contributes to any Benefit Plan other than those listed on Schedule 7.1(p).
Except as set forth on Schedule 7.1(p), each Benefit Plan is in substantial
compliance with ERISA and the Code, including but not limited to those
provisions thereof relating to reporting and disclosure, and neither the
Borrower nor any Related Company has received any notice asserting that a
Benefit Plan is not in compliance with ERISA. No material liability to the PBGC
or to Multiemployer Plan has been, or is expected to be, incurred by the
Borrower or any Related Company. Except as set forth on Schedule 7.1(p), each
Benefit Plan intended to qualify under Section 401(a) of the Code so qualifies
and any related trust is exempt from federal income tax under Section 501(a) of
the Code. A favorable determination letter from the IRS has been issued or
applied for with respect to each such plan and trust and nothing that has
occurred since the date of such determination letter that would adversely affect
such qualification or tax-exempt status. No Benefit Plan subject to the minimum
funding standards of the Code has failed to meet such standards. Neither the
Borrower nor any Related Company has transferred any pension plan liability in a
transaction that could be subject to Sections 4069 or 4212(c) of ERISA. Except
as set forth on Schedule 7.1(p), neither the Borrower nor any Related Company
has any liability, actual or contingent, with respect to any Benefit Plan in
accordance with its terms, and there are no pending or threatened claims against
a Benefit Plan. No non-exempt prohibited transaction within the meaning of
Section 4975 of the Code or Section 406 of ERISA has occurred with respect to a
Benefit Plan. Except under plans listed on Schedule 7.1(p), no employee or
former employee of the Borrower or any Related Company is or may become entitled
to any benefit under a Benefit Plan that is a "welfare plan" within the meaning
of Section 3(1) of ERISA following such employee's termination of employment.
Except as set forth on Schedule 7.1(p), each such welfare plan that is a group
health plan has been operated in compliance with the provisions of Section 4980B
of the Code and Sections 601-609 of ERISA and any applicable provisions of state
law that are similar.
(q) Absence of Defaults. Neither the Borrower nor any of its
Subsidiaries is in default under its articles or certificate of incorporation or
by-laws and no event has occurred, which has not been remedied, cured or waived,
(i) which constitutes a Default or an Event of Default, or
(ii) which constitutes, or which with the passage of time or
giving of notice, or both, would constitute, a default or event of
default by the Borrower or any of its Subsidiaries under any material
agreement (other than this Agreement, the Borrower RPA or the Investor
RPA) or judgment, decree or order to which the Borrower or any of its
Subsidiaries is a party or by which the Borrower, any of its
Subsidiaries or any of the Borrower's or any of its Subsidiaries'
properties may be bound or which would require the Borrower or any of
its Subsidiaries to make any payment under any thereof prior to the
scheduled maturity date therefor, except, in the case only of any such
agreement, for alleged defaults which are being contested in good faith
by appropriate proceedings and with respect to which reserves in
respect of the Borrower's or such Subsidiary's reasonably anticipated
liability have been established on the books of the Borrower or such
Subsidiary to the extent required in accordance with GAAP.
(r) Accuracy and Completeness of Information.
(i) All written information, reports and other papers and data
produced by or on behalf of the Borrower and furnished to the Agent or
any Lender were, to the best of the Borrower's knowledge, at the time
the same were so furnished, complete and correct in all material
respects, to the extent necessary to give the recipient a true and
accurate knowledge of the subject matter. No fact is known to the
Borrower which has had, or may in the future have (so far as the
Borrower can foresee), a Materially Adverse Effect which has not been
set forth in the financial statements or disclosure delivered prior to
the Agreement Date, in each case referred to in Section 7.1(n), or in
such written information, reports or other papers or data or otherwise
disclosed in writing to the Agent and the Lenders prior to the
Agreement Date. No document furnished or written statement made to the
Agent or any Lender by the Borrower in connection with the negotiation,
preparation or execution of this Agreement or any of the Loan Documents
contains or will contain any untrue statement of a fact material to the
creditworthiness of the Borrower or its Subsidiaries or omits or will
omit to state a material fact necessary in order to make the statements
contained therein not misleading.
(ii) The Borrower has no reason to believe that any document
furnished or written statement made to the Agent or any Lender by any
Person other than the Borrower in connection with the negotiation,
preparation or execution of this Agreement or any of the Loan Documents
contained any incorrect statement of a material fact or omitted to
state a material fact necessary in order to make the statements made,
in light of the circumstances under which they were made, not
misleading.
(s) Solvency. In each case after giving effect to the Debt represented
by the Loans outstanding and to be incurred, the transactions contemplated by
this Agreement and the Securitization Documents, the Borrower and each of the
Subsidiary Guarantors is solvent, having assets of a fair salable value which
exceeds the amount required to pay its debts as they become absolute and matured
(including contingent, subordinated, unmatured and unliquidated liabilities),
and the Borrower and each of the Subsidiary Guarantors is able to and
anticipates that it will be able to meet its debts as they mature and has
adequate capital to conduct the business in which it is or proposes to be
engaged.
(t) Chief Executive Office. The chief executive office of the Borrower
is located at the address set forth on Schedule 7.1(t); the Borrower has not
maintained its chief executive office at any other address at any time during
the five years immediately preceding the Agreement Date except as disclosed on
Schedule 7.1(t).
(u) Inventory.
(i) Condition. All Inventory is in good condition, meets all
standards imposed by any governmental agency, or department or division
thereof, having regulatory authority over such goods, their use or
sale, and is currently either usable or salable in the normal course of
the Borrower's business, except to the extent reserved against in the
financial statements referred to in Section 7.1(n) or delivered
pursuant to Article 11 or as disclosed on a Schedule of Inventory
delivered to the Agent pursuant to Section 9.7(b).
(ii) Location. All Inventory is located on the premises set
forth on Schedule 7.1(u) attached hereto or, after the Effective Date,
as listed on the replacement Schedule 7.1(u) delivered on the last day
of the most recently ended fiscal quarter of the Borrower, or is
Inventory in transit to one of such locations, except as otherwise
disclosed in writing to the Agent and the Borrower has not, in the last
year, located such Inventory at premises other than those set forth on
Schedule 7.1(u).
(v) Equipment. All Equipment is in good order and repair in all
material respects, ordinary wear and tear excepted, and is located on the
premises set forth on Schedule 7.1(v) and has been so located at all times
during the last year.
(w) Real Property. The Borrower owns no real estate and leases no real
estate other than that described on Schedule 7.1(w).
(x) Corporate and Fictitious Names. Except as otherwise disclosed on
Schedule 7.1(x), during the five-year period preceding the Agreement Date,
neither the Borrower nor any predecessor thereof has been known as or used any
corporate or fictitious name other than the corporate name of the Borrower on
the Effective Date.
(y) Federal Reserve Regulations. Neither the Borrower nor any of its
Subsidiaries is engaged and none will engage, principally or as one of its
important activities, in the business of extending credit for the purpose of
"purchasing" or "carrying" any "margin stock" (as each of the quoted terms is
defined or used in Regulations G and U of the Board of Governors of the Federal
Reserve System). No part of the proceeds of any of the Loans will be used for so
purchasing or carrying margin stock or, in any event, for any purpose which
violates, or which would be inconsistent with, the provisions of Regulation G,
T, U or X of such Board of Governors. If requested by the Agent or any Lender,
the Borrower will furnish to the Agent and the Lenders a statement or statements
in conformity with the requirements of said Regulation G, T, U or X to the
foregoing effect.
(z) Investment Company Act. The Borrower is not an "investment company"
or a company "controlled" by an "investment company" (as each of the quoted
terms is defined or used in the Investment Company Act of 1940, as amended).
(aa) Proprietary Rights. Schedule 7.1(aa) sets forth a correct and
complete list of all of the Proprietary Rights. None of the Proprietary Rights
is subject to any licensing agreement or similar arrangement except as set forth
on Schedule 7.1(aa) or as entered into in the sale or distribution of the
Borrower's Inventory in the ordinary course of business. To the best of the
Borrower's knowledge, none of the Proprietary Rights infringes on or conflicts
with any other Person's property, and no other Person's property infringes on or
conflicts with the Proprietary Rights. The Proprietary Rights described on
Schedule 7.1(aa) constitute all of the property of such type necessary to the
current and anticipated future conduct of the Borrower's business.
(bb) Trade Names. All trade names or styles under which the Borrower
sells Inventory or Equipment or creates Receivables, or to which instruments in
payment of Receivables are made payable, are listed on Schedule 7.1(bb).
(cc) Subordinated Indebtedness. The Borrower has the corporate power
and authority to incur the Senior Sub Debt. The issuance and sale of the Senior
Sub Debt have been registered or qualified under applicable federal and state
securities laws or are exempt therefrom. The Senior Sub Debt is the legally
valid and binding obligations of the Borrower enforceable against the Borrower
in accordance with its terms (including those pertaining to subordination). The
Borrower has delivered to the Agent a complete and correct copy of the 1997
Indenture and of all documents evidencing or relating to the Senior Sub Debt,
and each of the representations and warranties given by the Borrower therein is
true and correct in all material respects. The subordination provisions of the
1997 Indenture will be enforceable against the respective holders thereof by the
holder of any Note which has not effectively waived the benefits thereof. All of
the Secured Obligations constitute "Designated Senior Indebtedness" entitled to
the benefits of subordination created by the 1997 Indenture.
(dd) Securitization. The Borrower has the corporate power and authority
to execute and deliver, and to perform its obligations under the Securitization
Documents to which it is a party. Such Securitization Documents, in
substantially the forms previously delivered by or on behalf of the Borrower to
the Agent, have been, or on or prior to the Effective Date will have been, duly
executed and delivered by the Borrower and constitute, or when so executed and
delivered will constitute, the binding obligations of the Borrower.
SECTION 7.2 Survival of Representations and Warranties, Etc. All
representations and warranties set forth in this Article 7 and all statements
contained in any certificate, financial statement, or other instrument,
delivered by or on behalf of the Borrower pursuant to or in connection with this
Agreement or any of the Loan Documents (including, but not limited to, any such
representation, warranty or statement made in or in connection with any
amendment thereto) shall constitute representations and warranties made under
this Agreement. All representations and warranties made under this Agreement
shall be made or deemed to be made at and as of the Agreement Date, at and as of
the Effective Date and at and as of the date of each Loan, except that
representations and warranties which, by their terms are applicable only to one
such date shall be deemed to be made only at and as of such date. All
representations and warranties made or deemed to be made under this Agreement
shall survive and not be waived by the execution and delivery of this Agreement,
any investigation made by or on behalf of the Lender or any borrowing hereunder.
ARTICLE 8
SECURITY INTEREST
SECTION 8.1 Security Interest.
(a) To secure the payment, observance and performance of the Secured
Obligations, the Borrower hereby mortgages, pledges and assigns all of the
Collateral to the Agent, for the benefit of itself as Agent and the Lenders and
Affiliates of the Lenders, and grants to the Agent, for the benefit of itself as
Agent and the Lenders and Affiliates of the Lenders, a continuing security
interest in, and a continuing Lien upon, all of the Collateral.
(b) As additional security for all of the Secured Obligations, the
Borrower grants to the Agent, for the benefit of itself as Agent and the Lenders
and Affiliates of the Lenders, a security interest in, and assigns to the Agent,
for the benefit of itself as Agent and the Lenders and Affiliates of the
Lenders, all of the Borrower's right, title and interest in and to, any deposits
or other sums at any time credited by or due from each Lender and each Affiliate
of a Lender to the Borrower, or credited by or due from any participant of any
Lender to the Borrower, other than any such deposits, amounts or accounts
constituting Purchased A/R, with the same rights therein as if the deposits or
other sums were credited by or due from such Lender. The Borrower hereby
authorizes each Lender and each Affiliate of such Lender and each participant to
pay or deliver to the Agent, for the account of the Lenders, without any
necessity on the Agent's or any Lender's part to resort to other security or
sources of reimbursement for the Secured Obligations, at any time during the
continuation of any Event of Default or in the event that the Agent, on behalf
of the Lenders, should make demand for payment hereunder and without further
notice to the Borrower (such notice being expressly waived), any of the
aforesaid deposits (general or special, time or demand, provisional or final) or
other sums for application to any Secured Obligation, irrespective of whether
any demand has been made or whether such Secured Obligation is mature, and the
rights given the Agent, the Lenders, their Affiliates and participants hereunder
are cumulative with such Person's other rights and remedies, including other
rights of set-off. The Agent will promptly notify the Borrower of its receipt of
any such funds for application to the Secured Obligations, but failure to do so
will not affect the validity or enforceability thereof. The Agent may give
notice of the above grant of a security interest in and assignment of the
aforesaid deposits and other sums, and authorization, to, and make any suitable
arrangements with, any Lender, any such Affiliate of any Lender or participant
for effectuation thereof, and the Borrower hereby irrevocably appoints the Agent
as its attorney to collect any and all such deposits or other sums to the extent
any such payment is not made to the Agent or any Lender by such Lender,
Affiliate or participant.
SECTION 8.2 Continued Priority of Security Interest.
(a) The Security Interest granted by the Borrower shall at all times be
valid, perfected and enforceable against the Borrower and all third parties in
accordance with the terms of this Agreement, as security for the Secured
Obligations, and the Collateral shall not at any time be subject to any Liens
that are prior to, on a parity with or junior to the Security Interest, other
than Permitted Liens.
(b) The Borrower shall, at its sole cost and expense, take all action
that may be necessary or desirable, or that the Agent may reasonably request, so
as at all times to maintain the validity, perfection, enforceability and rank of
the Security Interest in the Collateral in conformity with the requirements of
Section 8.2(a), or to enable the Agent and the Lenders to exercise or enforce
their rights hereunder, including, but not limited to:
(i) paying all taxes, assessments and other claims lawfully
levied or assessed on any of the Collateral, except to the extent that
such taxes, assessments and other claims constitute Permitted Liens,
(ii) obtaining, after the Agreement Date, landlords',
mortgagees', bailees', warehousemen's or processors' releases,
subordinations or waivers, and using all reasonable efforts to obtain
mechanics' releases, subordinations or waivers,
(iii) delivering to the Agent endorsed or accompanied by such
instruments of assignment as the Agent may specify, and stamping or
marking, in such manner as the Agent may specify, any and all chattel
paper, instruments, letters and advices of guaranty and documents
evidencing or forming a part of the Collateral, and
(iv) executing and delivering financing statements, pledges,
designations, hypothecations, notices and assignments in each case in
form and substance satisfactory to the Agent relating to the creation,
validity, perfection, maintenance or continuation of the Security
Interest under the UCC or other Applicable Law.
(c) The Agent is hereby authorized to file one or more financing or
continuation statements or amendments thereto without the signature of or in the
name of the Borrower for any purpose described in Section 8.2(b). The Agent will
give the Borrower notice of the filing of any such statements or amendments,
which notice shall specify the locations where such statements or amendments
were filed. A carbon, photographic, xerographic or other reproduction of this
Agreement or of any of the Security Documents or of any financing statement
filed in connection with this Agreement is sufficient as a financing statement.
(d) The Borrower shall xxxx its books and records as may be necessary
or appropriate to evidence, protect and perfect the Security Interest and shall
cause its financial statements to reflect the Security Interest.
ARTICLE 9
COLLATERAL COVENANTS
Until the Revolving Credit Facility has been terminated and all the
Secured Obligations have been paid in full, unless the Required Lenders shall
otherwise consent in the manner provided in Section 16.10 (but subject to the
terms of the Intercreditor Agreement):
SECTION 9.1 Collection of Receivables.
(a) At the request of the Agent made at any time after the Collection
Date (as defined in the Investor RPA), the Borrower will cause all monies,
checks, notes, drafts and other payments relating to or constituting proceeds of
trade accounts receivable to be forwarded to one or more lockboxes for deposit
in a deposit account controlled by the Agent pursuant to an agreement
satisfactory to the Agent. The Borrower will promptly cause all monies, checks,
notes, drafts and other payments relating to or constituting proceeds of other
Receivables, of any other Collateral and of any trade accounts receivable that
are not forwarded to a lockbox, to be transferred to or deposited in such an
account, and in particular, the Borrower will:
(i) advise each Account Debtor on trade accounts receivable to
address all remittances with respect to amounts payable on account
thereof to a specified lockbox,
(ii) advise each other Account Debtor that makes payment to
the Borrower by wire transfer, automated clearinghouse (ACH) transfer
or similar means to make payment directly to a deposit account
controlled by the Agent pursuant to an agreement satisfactory to the
Agent, and
(iii) stamp all invoices relating to trade accounts receivable
with a legend satisfactory to the Agent indicating that payment is to
be made to the Borrower via a specified lockbox.
(b) At any time when the arrangements contemplated by Section 9.1(a)
are in effect, the Borrower and the Agent shall cause all collected balances in
each controlled account to be transmitted daily by wire transfer, ACH transfer,
depository transfer check or other means in accordance with the procedures set
forth in the corresponding agreement, to the Agent at the Agent's Office:
(i) for application, on account of the Secured Obligations,
and
(ii) with respect to the balance, so long as no Default or
Event of Default has occurred and is continuing, for transfer by wire
transfer, ACH transfer or depository transfer check to a Controlled
Disbursement Account or as otherwise agreed by the Agent and the
Borrower.
(c) At any time when the arrangements contemplated by Section 9.1(a)
are in effect, any monies, checks, notes, drafts or other payments referred to
in Section 9.1(a) which, notwithstanding the terms thereof are received by or on
behalf of the Borrower, will be held in trust for the Agent and will be
delivered to the Agent or a bank maintaining an Agent-controlled deposit
account, as promptly as possible, in the exact form received, together with any
necessary endorsements for application by the Agent directly to the Secured
Obligations or, if applicable, for deposit in the account maintained with such
bank and processing in accordance with the terms of the corresponding agreement.
SECTION 9.2 Verification and Notification. The Agent shall have the
right (a) at any time and from time to time, in the name of the Agent, the
Lenders or in the name of the Borrower, to verify the validity, amount or any
other matter relating to any Receivables not included in the Purchased A/R by
mail, telephone, telegraph or otherwise, (b) to review, audit and make extracts
from all records and files related to any of the Receivables, and (c) to notify
the Account Debtors or obligors under any Receivables not included in the
Purchased A/R of the assignment of such Receivables to the Agent and to direct
such Account Debtor or obligors to make payment of all amounts due or to become
due thereunder directly to the Agent and, upon such notification and at the
expense of the Borrower, to enforce collection of any such Receivables and to
adjust, settle or compromise the amount or payment thereof, in the same manner
and to the same extent as the Borrower might have done.
SECTION 9.3 Delivery of Instruments. In the event any Receivable that
is not a part of the Purchased A/R is at any time evidenced by a promissory note
or any other instrument for the payment of money, the Borrower will immediately
thereafter deliver such instrument to the Agent, appropriately endorsed to the
Agent, for the benefit of the Lenders.
SECTION 9.4 Sales of Inventory. All sales of Inventory will be made
in compliance with all requirements of Applicable Law.
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SECTION 9.5 Ownership and Defense of Title.
(a) Except for Permitted Liens, the Borrower shall at all times be the
sole owner or lessee of each and every item of Collateral and shall not create
any lien on, or sell, lease, exchange, assign, transfer, pledge, hypothecate,
grant a security interest or security title in or otherwise dispose of, any of
the Collateral or any interest therein, except for sales of Inventory in the
ordinary course of business, for cash or on open account or on terms of payment
ordinarily extended to its customers, and except for dispositions that are
otherwise expressly permitted under this Agreement. The inclusion of "proceeds"
of the Collateral under the Security Interest shall not be deemed a consent by
the Agent or the Lenders to any other sale or other disposition of any part or
all of the Collateral.
(b) The Borrower shall defend its title or leasehold interest in and
to, and the Security Interest in, the Collateral against the claims and demands
of all Persons.
SECTION 9.6 Insurance.
(a) The Borrower shall at all times maintain insurance on the Inventory
and Equipment against loss or damage by fire, theft (excluding theft by
employees), burglary, pilferage, loss in transit and such other hazards as the
Agent shall reasonably specify, in amounts not to exceed those obtainable at
commercially reasonable rates and under policies issued by insurers acceptable
to the Agent in the exercise of its reasonable judgment. All premiums on such
insurance shall be paid by the Borrower and copies of the policies delivered to
the Agent. The Borrower will not use or permit the Inventory or Equipment to be
used in violation of Applicable Law or in any manner which might render
inapplicable any insurance coverage.
(b) All insurance policies required under Section 9.6(a) shall name the
Agent, for the benefit of the Lenders, as an additional insured and shall
contain loss payable clauses in the form submitted to the Borrower by the Agent,
or otherwise in form and substance satisfactory to the Required Lenders, naming
the Agent, for the benefit of the Lenders, as loss payee, as its interests may
appear, and providing that
(i) all proceeds thereunder shall be payable to the Agent,
for the benefit of the Lenders,
(ii) no such insurance shall be affected by any act or neglect
of the insurer or owner of the property described in such policy, and
(iii) such policy and loss payable clauses may be cancelled,
amended or terminated only upon at least 10 days' prior written notice
given to the Agent.
(c) Any proceeds of insurance referred to in this Section 9.6 which are
paid to the Agent, for the account of the Lenders, shall be, at the option of
the Required Lenders in their sole discretion, either (i) applied to replace the
damaged or destroyed property, or (ii) applied to the payment or prepayment of
the Secured Obligations, provided that in the event that the proceeds from any
single casualty do not exceed $10,000,000, then, upon the Borrower's written
request to the Agent, provided that no Event of Default has occurred and is
continuing, such proceeds shall be disbursed by the Agent to the Borrower
pursuant to such procedures as the Agent shall reasonably establish for
application to the replacement of the damaged or destroyed property.
SECTION 9.7 Location of Offices and Collateral.
(a) The Borrower will not change the location of its chief executive
office or the place where it keeps its books and records relating to the
Collateral or change its name, its identity or corporate structure without
giving the Agent 60 days' prior written notice thereof.
(b) All Inventory, other than Inventory in transit to any such
location, and all equipment will at all times be kept by the Borrower at the
locations set forth in Schedules 7.1(u) and 7.1(v), and shall not, without the
prior written consent of the Agent, be removed therefrom except pursuant to
sales of Inventory permitted under Section 9.6(a).
(c) If any Inventory is in the possession or control of any of the
Borrower's agents or processors, the Borrower shall notify such agents or
processors of the Security Interest (and shall promptly provide copies of any
such notice to the Agent and the Lenders) and, upon the occurrence of an Event
of Default, shall instruct them (and cause them to acknowledge such instruction)
to hold all such Inventory for the account of the account of the Lenders,
subject to the instructions of the Agent.
SECTION 9.8 Records Relating to Collateral.
(a) The Borrower will at all times
(i) keep complete and accurate records of Inventory on a basis
consistent with past practices of the Borrower so as to permit
comparison of Inventory records relating to different time periods,
itemizing and describing the kind, type and quantity of Inventory and
the Borrower's cost thereof and a current price list for such
Inventory, and
(ii) keep complete and accurate records of all other
Collateral.
(b) The Borrower will conduct a physical count of all Inventory,
wherever located, at least annually.
SECTION 9.9 Inspection. The Agent and each Lender (by any of its
officers, employees or agent) shall have the right to the extent that the
exercise of such right is within the control of the Borrower, at any reasonable
time during normal business hours and at its own expense, to inspect the
Collateral, all files relating thereto and the premises upon which any of the
Collateral is located, to discuss the Borrower's affairs and finances, insofar
as the same are reasonably related to the rights of the Agent and such Lender
hereunder or under any of the Loan Documents, with any Person, to verify the
amount, quantity, value and condition of, or any other matter relating to, any
of the Collateral and in this connection to review, audit and make extracts from
all records and files related to any of the Collateral. The Borrower will
deliver to the Agent and each Lender any instrument necessary for it to obtain
records from any service bureau maintaining records on behalf of the Borrower.
SECTION 9.10 Information and Reports.
(a) Schedule of Receivables. The Borrower shall deliver to the Agent
when delivered to EagleFunding, copies of the Asset Report (as defined in the
Investor RPA) and, at the Agent's request, of any other report delivered to
EagleFunding by the Borrower or Funding pursuant to the Securitization
Documents.
(b) Schedule of Inventory. The Borrower shall deliver to the Agent on
or before the Effective Date and thereafter upon the Agent's request, a Schedule
of Inventory as of a recent date, itemizing and describing the kind, type and
quantity of Inventory, the Borrower's cost thereof and the location thereof.
(c) Notice of Diminution of Value. The Borrower shall give prompt
notice to the Agent of any matter or event which has resulted in, or may result
in, the diminution in excess of $1,000,000 in the value of any of its
Collateral, except for any such diminution in the value of any Receivables or
Inventory in the ordinary course of business which has been appropriately
reserved against, as reflected in financial statements previously delivered to
the Agent and the Lenders pursuant to Article 11.
(d) Additional Information. The Borrower will also furnish to the Agent
and each Lender such other information with respect to the Collateral as the
Agent or any Lender may from time to time reasonably request.
SECTION 9.11 Power of Attorney. The Borrower hereby appoints the
Agent as its attorney, with power
(a) to endorse the name of the Borrower on any checks, notes,
acceptances, money orders, drafts or other forms of payment or security that may
come into the Agent's or any Lender's possession, and
(b) if an Event of Default has occurred and is continuing, to sign the
name of the Borrower on any invoice or xxxx of lading relating to any Receivable
not included in Purchased A/R, Inventory or other Collateral.
ARTICLE 10
AFFIRMATIVE COVENANTS
The Borrower covenants and agrees that the Borrower will duly and
punctually pay the principal of, and interest on, and all other amounts payable
with respect to, the Loans and all other Secured Obligations in accordance with
the terms of the Loan Documents and that until the Revolving Credit Facility has
been terminated and all the Secured Obligations have been paid in full, unless
the Required Lenders shall otherwise consent in the manner provided for in
Section 16.10, the Borrower will, and will cause each of its Subsidiaries to:
SECTION 10.1 Preservation of Corporate Existence and Similar Matters.
Preserve and maintain its corporate existence, rights, franchises, licenses and
privileges in the jurisdiction of its incorporation and qualify and remain
qualified as a foreign corporation and authorized to do business in each
jurisdiction in which the failure to be so qualified would have a Materially
Adverse Effect.
SECTION 10.2 Compliance with Applicable Law. Comply with all Applicable
Law relating to the Borrower or such Subsidiary except to the extent that the
failure to do so could not reasonably be expected to have a Materially Adverse
Effect.
SECTION 10.3 Maintenance of Property. In addition to, and not in
derogation of, the requirements of Section 9.5 and of the Security Documents,
(a) protect and preserve all properties material to its business,
including copyrights, patents, trade names and trademarks, and maintain in good
repair, working order and condition in all material respects, with reasonable
allowance for wear and tear, all tangible properties, and
(b) from time to time make or cause to be made all needed and
appropriate repairs, renewals, replacements and additions to such properties
necessary for the conduct of its business, so that the business carried on in
connection therewith may be properly and advantageously conducted at all times.
SECTION 10.4 Conduct of Business. At all times carry on its business in
an efficient manner and engage only in businesses in substantially the same
field as the businesses conducted on the Agreement Date and businesses
reasonably related thereto, provided that Funding shall engage exclusively in
the transactions contemplated by the Securitization Documents.
SECTION 10.5 Insurance. Maintain, in addition to the coverage required
by Section 9.6 and the Security Documents, insurance with responsible insurance
companies against such risks and in such amounts as is customarily maintained by
similar businesses or as may be required by Applicable Law, and from time to
time deliver to the Agent or any Lender upon its request a detailed list of the
insurance then in effect, stating the names of the insurance companies, the
amounts and rates of the insurance, the dates of the expiration thereof and the
properties and risks covered thereby.
SECTION 10.6 Payment of Taxes and Claims. Pay or discharge when due
(a) all taxes, assessments and governmental charges or levies imposed
upon it or upon its income or profits or upon any properties belonging to it,
except that real property ad valorem taxes shall be deemed to have been so paid
or discharged if the same are paid before they become delinquent, and
(b) all lawful claims of materialmen, mechanics, carriers, warehousemen
and landlords for labor, materials, supplies and rentals which, if unpaid, might
become a Lien on any properties of the Borrower;
except that this Section 10.6 shall not require the payment or discharge of any
such tax, assessment, charge, levy or claim which is being contested in good
faith by appropriate proceedings and for which adequate reserves have been
appropriately established in accordance with GAAP.
SECTION 10.7 Accounting Methods and Financial Records. Maintain a
system of accounting, and keep such books, records and accounts (which shall be
true and complete), as may be required or as may be necessary to permit the
preparation of financial statements in accordance with GAAP, and maintain an
October 1 - September 30 fiscal year.
SECTION 10.8 Use of Proceeds.
(a) Use the proceeds of
(i) the initial Revolving Credit Loans to pay or prepay
amounts owing on the Effective Date under the Existing Credit Agreement
and otherwise to pay amounts indicated on Schedule 10.8 to the Persons
indicated thereon, and
(ii) all subsequent Loans for working capital and general
business purposes and to make Permitted Investments and to the extent
permitted pursuant to Section 12.4, Acquisitions, and
(b) not use any part of such proceeds to purchase or, to carry or
reduce or retire or refinance any credit incurred to purchase or carry, any
margin stock (within the meaning of Regulation G or U of the Board of Governors
of the Federal Reserve System) or, in any event, for any purpose which would
involve a violation of such Regulation G or U or of Regulation T or X of such
Board of Governors, or for any purpose prohibited by law or by the terms and
conditions of this Agreement.
SECTION 10.9 Hazardous Waste and Substances; Environmental Requirements.
(a) In addition to, and not in derogation of, the requirements of
Section 10.2 and of the Security Documents, comply with all Environmental Laws
and all Applicable Laws relating to occupational health and safety (except for
instances of noncompliance that are being contested in good faith by appropriate
proceedings if reserves in respect of the Borrower's or such Subsidiary's
reasonably anticipated liability therefor have been appropriately established in
accordance with GAAP), promptly notify the Agent of its receipt of any notice of
a violation of any such Environmental Laws or other such Applicable Laws and
indemnify and hold the Agent and the Lenders harmless from all loss, cost,
damage, liability, claim and expense incurred by or imposed upon the Agent or
any Lender on account of the Borrower's failure to perform its obligations under
this Section 10.9.
(b) Whenever the Borrower gives notice to the Agent pursuant to this
Section 10.9 or otherwise with respect to a matter that reasonably could be
expected to result in liability to the Borrower or any Subsidiary in excess of
$500,000 in the aggregate, the Borrower shall, at the Agent's request and the
Borrower's expense (i) cause an independent environmental engineer acceptable to
the Agent to conduct an assessment, including tests where necessary, of the site
where the noncompliance or alleged noncompliance with Environmental Laws has
occurred and prepare and deliver to the Agent a report setting forth the results
of such assessment, a proposed plan to bring the Borrower (or such Subsidiary)
into compliance with such Environmental Laws (if such assessment indicates
noncompliance) and an estimate of the costs thereof, and (ii) provide to the
Agent a supplemental report of such engineer whenever the scope of the
noncompliance, or the response thereto or the estimated costs thereof, shall
materially adversely change.
SECTION 10.10 Compliance with Securitization Documents. Comply and
cause Funding to comply with the terms and provisions of the Securitization
Documents.
SECTION 10.11 Subsidiary Guaranty. Cause each Person (other than
Funding and any Subsidiary organized under the laws of a jurisdiction outside
the United States of America) that is or after the Agreement Date becomes a
Subsidiary to execute and deliver the Subsidiary Guaranty and to secure its
obligations thereunder by a pledge of substantially all of its assets, pledge to
the Agent, by amendment to the Pledge Agreement or otherwise by an instrument or
agreement satisfactory in form and substance to the Agent, 100% (or 66-2/3%, if
such Subsidiary is organized under the laws of a jurisdiction outside the United
States of America) of the issued and outstanding capital stock of such
Subsidiary and cause each new Subsidiary Guarantor to deliver the certificates
and other documents referred to in Section 6.1(b), as in effect on the date of
delivery of the Subsidiary Guaranty by such Subsidiary Guarantor.
ARTICLE 11
INFORMATION
Until the Revolving Credit Facility has been terminated and all the
Secured Obligations have been paid in full, unless the Required Lenders shall
otherwise consent in the manner set forth in Section 16.10, the Borrower will
furnish to the Agent and to each Lender at its offices then designated for
notices pursuant to Section 16.1, the statements, reports, certificates, and
other information provided for in this Article 11. All written information,
reports, statements and other papers and data furnished to the Agent or any
Lender by or at the request of the Borrower, whether pursuant to this Article 11
or any other provision of this Agreement or of any other Loan Document, shall
be, at the time the same is so furnished, complete and correct in all material
respects to the extent necessary to give the Agent and the Lenders true and
accurate knowledge of the subject matter. Specifically, the Borrower will so
furnish:
SECTION 11.1 Financial Statements.
(a) Audited Year-End Statements. As soon as available, but in any event
within 90 days after the end of each fiscal year of the Borrower, copies of the
consolidated balance sheet of the Borrower and its Consolidated Subsidiaries as
at the end of such fiscal year and the related consolidated statements of
income, shareholders' equity and cash flows for such fiscal year, in each case
setting forth in comparative form the figures for the previous year of the
Borrower, certified, without qualification as to the scope of the audit or the
going concern nature of the Borrower, by Deloitte & Touche LLP or other
nationally recognized, reputable independent certified public accountants
selected by the Borrower, and of the report on Form 10-K filed by the Borrower
with the Securities and Exchange Commission;
(b) Monthly Financial Statements. As soon as available after the end of
each month, but in any event (i) within 20 days after the end of each month,
other than October (in which case by December 15) and November (in which case by
December 30), copies of the unaudited consolidated balance sheet of the Borrower
and its Consolidated Subsidiaries as at the end of such month and the related
unaudited consolidated statements of income and cash flow for the Borrower and
its Consolidated Subsidiaries for such month, for the fiscal quarter of the
Borrower ending with such month (if applicable) and for the portion of the
fiscal year of the Borrower through such month, comparable information for the
same periods of the preceding fiscal year of the Borrower, divisional operating
results for such periods and comparable information for the same periods of the
preceding fiscal year of the Borrower, and comparisons, where applicable, to the
Borrower's plan in effect for the current fiscal year and (ii) not later than 45
days after the end of each of the first three fiscal quarters of the Borrower, a
copy of the report on Form 10-Q filed by the Borrower with the Securities and
Exchange Commission, each of the foregoing to be certified by the Financial
Officer as presenting fairly in accordance with GAAP consistently applied (but
for the absence of notes and subject to year-end audit adjustments) the
information purported to be reflected thereon for the Borrower and its
Consolidated Subsidiaries; and
(c) Forecasts. Not later than 30 days before the first day of each
fiscal year of the Borrower, a forecast of operations for such fiscal year,
including at least a forecasted balance sheet, income statement and cash flow
statement, on a monthly basis, for the Borrower and its Consolidated
Subsidiaries, and forecasted results of operations for the Borrower's principal
business segments, all such forecasts to be on a monthly basis and otherwise
acceptable to the Agent.
SECTION 11.2 Accountants' Certificate. Together with the financial
statements referred to in Section 11.1(a), a certificate of such
accountants addressed to the Agent
(a) stating that in making the examination necessary for the
certification of such financial statements, nothing has come to their attention
to lead them to believe that any Default or Event of Default exists and, in
particular, they have no knowledge of any Default or Event of Default or, if
such is not the case, specifying such Default or Event of Default and its
nature, and
(b) having attached the calculations, prepared by the Borrower and
reviewed by such accountants, required to establish whether or not the Borrower
is in compliance with the covenants contained in Sections 12.1, 12.2, 12.4,
12.5, 12.10 and 12.11, as at the date of such financial statements.
SECTION 11.3 Officer's Certificate. At the time that the Borrower
furnishes a copy of its report on Form 10-Q or 10-K, a certificate of its
President or a Financial Officer in substantially the form of Exhibit F or in
such other form as is acceptable to the Agent,
(a) setting forth as at the end of such fiscal quarter or fiscal year,
as the case may be, the calculations required to establish whether or not the
Borrower was in compliance with the requirements of Sections 12.1, 12.2, 12.4,
12.5, 12.10 and 12.11, as at the end of each respective period and the
calculations of the ratio of Funded Debt to EBITDA and of Pricing Coverage
necessary to determine any adjustment to the Applicable Margin on the succeeding
Margin Adjustment Date,
(b) having attached thereto a complete set of the Schedules to this
Agreement that is complete and accurate as of the date of such certificate, and
(c) stating that, based on a reasonably diligent examination, no
Default or Event of Default exists, or, if such is not the case, specifying such
Default or Event of Default and its nature, when it occurred, whether it is
continuing and the steps being taken by the Borrower with respect to such
Default or Event of Default.
SECTION 11.4 Copies of Other Reports.
(a) Promptly upon receipt thereof, copies of all reports, if any,
submitted to the Borrower, any Subsidiary or their respective Boards of
Directors by their independent public accountants, including, without
limitation, any management report.
(b) As soon as practicable, copies of all financial statements and
reports that the Borrower shall send to its shareholders generally or to holders
of Senior Sub Debt or, including in its capacity as Collection Agent (as defined
in the Investor RPA) and, at the request of the Agent, to EagleFunding and of
all registration statements and all regular or periodic reports which the
Borrower shall file with the Securities and Exchange Commission or any successor
commission.
(c) From time to time and as soon as reasonably practicable following
each request, such forecasts, data, certificates, reports, statements, opinions
of counsel, documents or further information regarding the business, assets,
liabilities, financial condition, results of operations or business prospects of
the Borrower or any of its Subsidiaries as the Agent or any Lender may
reasonably request and that the Borrower has or (except in the case of legal
opinions relating to the perfection or priority of the Security Interest)
without unreasonable expense can obtain. The rights of the Agent and the Lenders
under this Section 11.4(c) are in addition to and not in derogation of their
rights under any other provision of this Agreement or of any other Loan
Document.
(d) If requested by the Agent or any Lender, the Borrower will furnish
to the Agent and the Lenders statements in conformity with the requirements of
Federal Reserve Form G-3 or U-1 referred to in Regulation G and U, respectively,
of the Board of Governors of the Federal Reserve System.
SECTION 11.5 Notice of Litigation and Other Matters.Prompt notice of:
(a) the commencement, to the extent the Borrower is aware of the same,
of all proceedings and investigations by or before any governmental or
nongovernmental body and all actions and proceedings in any court or before any
arbitrator against or in any other way relating to or affecting the Borrower,
any of its Subsidiaries or any of the Borrower's or any of its Subsidiaries'
properties, assets or businesses, which might, singly or in the aggregate,
result in the occurrence of a Default or an Event of Default, or have a
Materially Adverse Effect ,
(b) any amendment of the certificate of incorporation or the charter
documents, by-laws or partnership certificate or agreement of the Borrower or
any of its Subsidiaries or Affiliates,
(c) any change in the business, assets, liabilities, financial
condition, results of operations or business prospects of the Borrower or any of
its Subsidiaries which has had or could reasonably be expected to have, singly
or in the aggregate, a Materially Adverse Effect and of any change in the
executive officers of the Borrower or any Subsidiary, and
(d) any Default or Event of Default or any event which constitutes or
which with the passage of time or giving of notice or both would constitute a
default or event of default by the Borrower or any of its Subsidiaries and any
Termination Event (as defined in the Borrower RPA or the Investor RPA) under any
material agreement (other than this Agreement) to which the Borrower or such
Subsidiary is a party or by which the Borrower, any of its Subsidiaries or any
of the Borrower's or any of its Subsidiaries' properties may be bound,
including, without limitation, the 1997 Indenture and any of the Securitization
Documents.
SECTION 11.6 ERISA. As soon as possible and in any event within 30
days after the Borrower knows, or has reason to know, that:
(a) any ERISA Event with respect to a Benefit Plan has occurred or
will occur, or
(b) the aggregate present value of the Unfunded Vested Accrued Benefits
under all Benefit Plans is equal to an amount in excess of $0, or
(c) the Borrower or any Subsidiary is in "default" (as defined in
Section 4219(c)(5) of ERISA) with respect to payments to a Multiemployer Benefit
Plan required by reason of the Borrower's or such Subsidiary's complete or
partial withdrawal (as described in Section 4203 or 4205 of ERISA) from such
Multiemployer Plan,
a certificate of the President of the Borrower or Chief Financial Officer
setting forth the details of such event and the action which is proposed to be
taken with respect thereto, together with any notice or filing which may be
required by the PBGC or other agency of the United States government with
respect to such event.
SECTION 11.7 Revisions or Updates to Schedules. Should any of the
information or disclosures provided on any of the Schedules originally attached
hereto become outdated or incorrect in any material respect, as part of the
officer's certificate required pursuant to Section 11.3(b), such revisions or
updates to such Schedule(s) as may be necessary or appropriate to update or
correct such Schedule(s), provided that no such revisions or updates to any
Schedule(s) shall be deemed to have amended, modified or superseded such
Schedule(s) as attached hereto immediately prior to the submission of such
revised or updated Schedule(s), or to have cured any breach of warranty or
representation resulting from the inaccuracy or incompleteness of any such
Schedule(s), unless and until the Required Lenders in their sole and absolute
discretion, shall have accepted in writing such revisions or updates to such
Schedule(s).
ARTICLE 12
NEGATIVE COVENANTS
Until the Revolving Credit Facility has been terminated and all the
Secured Obligations have been paid in full, unless the Required Lenders shall
otherwise consent in the manner set forth in Section 16.10, the Borrower will
not directly or indirectly and, in the case of Sections 12.2 through 12.13, will
not permit its Subsidiaries to:
SECTION 12.1 Financial Ratios. Permit:
(a) Minimum Net Worth. Consolidated Net Worth of the Borrower and its
Consolidated Subsidiaries at any time after the Effective Date to be less than
the sum of (i) $102,817,000 plus (ii) an amount equal to 75% of consolidated Net
Income of the Borrower and its Consolidated Subsidiaries for each fiscal quarter
of the Borrower ending after the Effective Date and on or prior to the date of
determination, on a cumulative basis (and without deduction for any losses).
(b) Minimum Interest Coverage. The ratio of EBIT to Total Interest
Expense for any period of four consecutive fiscal quarters of the Borrower
ending:
(i) after the Effective Date and on or before June 30,
1999, to be less than 1.75 to 1; or
(ii) after June 30, 1999, to be less than 2.00 to 1.
Where:
EBIT for any accounting period means Net Income of the Borrower and its
Consolidated Subsidiaries for such period, plus the sum of (i) federal and state
income tax expense of the Borrower and its Consolidated Subsidiaries and (ii)
Total Interest Expense for such period, minus any amount in respect of federal
or state income tax refunds or interest income to the extent such amounts were
deducted, or included, in such Net Income.
and
Total Interest Expense for any accounting period, means total interest
expense for Debt of the Borrower and its Consolidated Subsidiaries, determined
in accordance with GAAP, including all capitalized interest in connection with
Capital Expenditures.
(c) Maximum Cash Flow Leverage. The ratio of Funded Debt as of the last
day of any fiscal quarter of the Borrower to EBITDA for the period of four
consecutive fiscal quarters of the Borrower ending on such day and ending:
(i) after the Effective Date and on or before June 30,
1998, to be greater than 4.25 to 1;
(ii) after June 30, 1998 and on or before June 30, 1999,
to be greater than 4.00 to 1; or
(iii) after June 30, 1999, to be greater than 3.75 to 1.
Where:
Funded Debt as of any date means all Debt of the Borrower and its
Consolidated Subsidiaries, including, without being limited to, Loans,
Subordinated Debt and Capitalized Leases, and Debt of EagleFunding attributable
to the transactions contemplated by the Investor RPA.
and
EBITDA for any accounting period means EBIT for such period, plus the
sum of (i) depreciation expense and (ii) amortization expense of the Borrower
and its Consolidated Subsidiaries for such period.
(d) Minimum Adjusted Fixed Charge Coverage. The ratio of Adjusted
Operating Cash Flow to Total Debt Service for any period of four consecutive
fiscal quarters of the Borrower ending:
(i) after the Effective Date and on or before June 30,
1999, to be less than 1.75 to 1; or
(ii) after June 30, 1999, to be less than 2.00 to 1.
Where:
Adjusted Operating Cash Flow for any accounting period means EBITDA for
such period, minus the sum of (i) cash income taxes paid by the Borrower and its
Consolidated Subsidiaries during such period (net of cash refunds of income
taxes received by them during such period) and (ii) the lesser of (A)
$14,000,000 and (B) the amount of Capital Expenditures of the Borrower and its
Consolidated Subsidiaries during such period after deducting all capitalized
interest related thereto.
and
Total Debt Service for any accounting period means the sum of (i)
repayments of principal of Funded Debt scheduled to be made during such period
and (ii) Total Interest Expense minus, to the extent included in Total Interest
Expense, any amortization of bond discount.
SECTION 12.2 Debt. Create, assume, or otherwise become or remain
obligated in respect of, or permit or suffer to exist or to be created, assumed
or incurred or to be outstanding any Debt, except that this Section 12.2 shall
not apply to:
(a) Debt of the Borrower represented by the Loans and the Notes,
(b) Debt of the Borrower represented by Subordinated Debt,
(c) other Debt reflected on Schedule 7.1(j), excluding any such Debt
that is to be paid in full on the Effective Date,
(d) Permitted Purchase Money Debt and Capitalized Lease Obligations, in
an aggregate outstanding principal amount not greater than $5,000,000.
(e) Debt under Guaranties permitted pursuant to Section 12.3,
(f) Debt of the Borrower under Interest Rate Protection Agreements
and Currency Agreements,
(g) Foreign Facility Debt in a principal amount outstanding that
does not exceed $5,000,000 at any time and any Guaranty thereof,
(h) Debt, if any, incurred in connection with the Securitization,
and
(i) in addition to Debt described in the foregoing clauses (a) through
(h), other Debt of the Borrower, the outstanding principal amount of which does
not exceed $25,000,000 at any time.
SECTION 12.3 Guaranties. Become or remain liable with respect to any
Guaranty of any obligation of any other Person, except that this Section 12.3
shall not apply to Existing Guaranties.
SECTION 12.4 Investments. Acquire, after the Agreement Date, any
Business Unit or Investment or, after such date, maintain any Investment other
than Permitted Investments, except that this Section 12.4 shall not apply to
Investments in the capital stock of any other Person which thereupon becomes a
Wholly Owned Subsidiary or to Acquisitions by the Borrower of Business Units, in
either case located in the United States, (i) the aggregate Purchase Price of
which does not exceed $25,000,000 in any Loan Year or $35,000,000 in total
during the term of this Agreement, (ii) as to which the Borrower has completed
and made available to the Agent not later than 10 Business Days prior to the
proposed date of such Investment or Acquisition, the results of an investigation
of the target satisfactory to the Agent as to scope and results, including,
without being limited to, satisfactory compliance by the proposed target with
Applicable Laws, including Environmental Laws, (iii) as to which the Agent shall
have received evidence satisfactory to it of the Borrower's continued compliance
with the provisions of this Agreement and the other Loan Documents, including,
without being limited to, the provisions of Sections 10.4 and 12.1, on a pro
forma basis after giving effect to such Investment or Acquisition, (iv) if
financed in whole or in part with Debt other than Loans, such Debt shall be
payable to the seller of such Investment or Business Unit and shall be
subordinated to the prior payment of the Secured Obligations on terms and
conditions satisfactory to the Agent and the Required Lenders, (v) any new
Subsidiary shall have executed and delivered the Subsidiary Guaranty, such
security documents as the Agent may reasonably specify, and shall have delivered
or caused to be delivered the items as to such Subsidiary referred to in Section
6.1(b) and an opinion of counsel for such Subsidiary as to such matters in
connection with the transactions contemplated by the Subsidiary Guaranty as the
Agent may reasonably request, and (vi) to the extent all Acquired assets are
subject to the Security Interest and to no other Lien other than Permitted
Liens. For purposes of this Section 12.4, Purchase Price means an amount equal
to the total consideration paid for such Investment or Acquisition, including
all cash payments (whether classified as purchase price, noncompete payments,
consulting payments or otherwise and without regard to whether such amount is
paid in whole or in part at the closing of the Investment or Acquisition or over
time thereafter, but excluding any finance charges attributable to deferred
payments and excluding any salary or other employment compensation paid to a
seller for the purpose of retaining such seller's services as an active employee
of the Borrower or a Subsidiary), and the value (as determined by the board of
directors of the Borrower, including pursuant to the applicable purchase
agreement between the Borrower and the seller, in the case of any property, the
fair value of which is not readily ascertainable) of all other property, other
than capital stock of the Borrower, transferred by the Borrower to the Seller.
SECTION 12.5 Capital Expenditures. Make or incur any Capital
Expenditures (excluding Financed Capex) in the aggregate in excess of the amount
set forth below for the fiscal year of the Borrower ending on September 30 of
the year set forth opposite such amount:
Year Amount
1998 $51,000,000
1999 $30,000,000 plus the 1998 Carryover
2000 $15,000,000 plus the 1999 Carryover
2001 and thereafter $15,000,000
Where:
1998 Carryover means the lesser of (i) $10,000,000 and (ii) the excess,
if any, of $51,000,000 over actual Capital Expenditures (excluding Financed
Capex) of the Borrower and its Subsidiaries on a consolidated basis for the
fiscal year of the Borrower ending September 30, 1998.
and
1999 Carryover means the lesser of (i) $10,000,000 and (ii) the excess,
if any, of $30,000,000 over actual Capital Expenditures (excluding Financed
Capex) of the Borrower and its Subsidiaries on a consolidated basis for the
fiscal year of the Borrower ending September 30, 1999.
SECTION 12.6 Restricted Distributions and Payments, Etc.. Declare or
make any Restricted Distribution or Restricted Payment, except that this Section
12.6 shall not apply to (i) the early termination of certain equipment leases as
in effect on the Agreement Date between the Borrower as lessee and General
Electric Capital Corporation or any of its Affiliates as lessor, or (ii) one or
more purchases by the Borrower of Equity Interests of the Borrower for an
aggregate amount of up to $10,000,000 during the term of this Agreement, upon
five days' prior notice to the Agent, and as to each of which purchases the
Agent shall be satisfied that after giving pro forma effect thereto as if such
purchase had occurred 30 days prior to the date of such notice, the Revolving
Credit Availability, during such 30-day period would at all times have been
greater than $10,000,000. For purposes of this Section 12.6, Equity Interest
means (i) any and all shares, interests, participations rights or other
equivalents (however designated) of or in the stock of any corporation, (ii) any
general or limited partnership interest, (iii) any membership interest in any
limited liability company, (iv) any other interest or participation that confers
on the holder a right to receive a share of the profits (and losses) of, or
distributions of assets of, the issuer (other than any debt security convertible
into any of the foregoing) and (v) any warrant, option or other right (or
obligation) to acquire any of the foregoing.
SECTION 12.7 Merger, Consolidation and Sale of Assets. Merge or
consolidate with any other Person or sell, lease, assign, transfer, or otherwise
dispose of any of its assets, except (a) dispositions of inventory in the
ordinary course of business; (b) dispositions of unnecessary, obsolete or worn
out equipment; (c) sales of RPA Receivables contemplated by and in accordance
with the terms of the Securitization Documents, (d) sales of owned Real Estate
in sale/leaseback transactions (i) as to which the purchaser/lessor has
delivered to the Agent a landlord's subordination and waiver in form and
substance satisfactory to the Agent and (ii) that are otherwise in compliance
with the terms of this Agreement and the other Loan Documents, including,
without being limited to, the provisions of Section 12.2, and (e) other sales or
dispositions of assets for fair value paid in cash at the closing of the
disposition and in arm's length transactions; provided that with respect to any
asset disposed of pursuant to the provisions of this clause (e):
(i) no Default exists or would result from such disposition;
(ii) the Borrower shall have provided the Agent written notice
of the proposed disposition not less than 10 Business Days prior to the
date of the proposed disposition and a certification demonstrating
compliance with clauses (i) and (iii) of this clause (e);
(iii) the sales price for the assets sold (as determined in
accordance with the applicable sale agreement) in such transaction when
added to the sales price for all other assets disposed of in the same
Loan Year does not exceed $2,000,000.
The Agent will, at the Borrower's expense, execute and deliver any termination
statements or other evidences of release of assets disposed of in compliance
with the terms hereof as the Borrower may reasonably request.
SECTION 12.8 Transactions with Affiliates. Effect any transaction with
any Affiliate on a basis less favorable to the Borrower than would be the case
if such transaction had been effected with a Person not an Affiliate.
SECTION 12.9 Liens. Create, assume or permit or suffer to exist or to
be created or assumed any Lien on any of the Collateral, other than Permitted
Liens, except that the provisions of this Section 12.9 shall not,
notwithstanding the provisions of Section 12.10, apply to Liens affecting
exclusively property acquired by the Borrower or its Subsidiaries after the
Effective Date, the acquisition of which was financed with Debt incurred as
permitted by Section 12.2(i) (whether or not such Debt constitutes Capitalized
Lease Obligations or Purchase Money Debt) and, for avoidance of doubt, Liens
affecting exclusively real property do not affect "Collateral."
SECTION 12.10 Plans. Permit, or take any action that would result in,
an ERISA Event or in the aggregate present value of the Unfunded Vested Accrued
Benefits under all Benefit Plans of the Borrower exceeding $0.
SECTION 12.11 Amendments to Other Agreements. Amend in any material
respect the 1997 Indenture, the Senior Sub Debt or the Securitization Documents,
or consent to or enter into any agreement providing for the designation of any
Debt of the Borrower or any Subsidiary, other than Debt represented by the
Loans, the Notes and the Foreign Facilities, as "Designated Senior
Indebtedness," as such term is defined in the 1997 Indenture; provided, however,
that any extension of the Securitization Documents on substantially similar
terms shall not be a material amendment for purposes of this Section 12.11.
SECTION 12.12 Issuance of Stock by Subsidiaries Permit any Subsidiary
(either directly or indirectly by issuance of rights or options for, or
securities convertible into, such shares) to issue, sell or otherwise dispose of
any shares (other than directors' qualifying shares) of any class of its capital
stock.
ARTICLE 13
DEFAULT
SECTION 13.1 Events of Default. Each of the following shall constitute
an Event of Default, whatever the reason for such event and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment or order of any court or any order, rule or regulation of any
governmental or nongovernmental body:
(a) Default in Payment. Any Loan Party shall default in any payment of
principal of or interest on any Loan, Note, Foreign Facility Debt or
Reimbursement Obligations when and as due (whether at maturity, by reason of
acceleration or otherwise).
(b) Other Payment Default. Any Loan Party shall default in the payment,
as and when due, of principal of or interest on, any other Secured Obligation,
and such default shall continue for a period of five days after written notice
thereof has been given to the Borrower by the Agent.
(c) Misrepresentation. Any representation or warranty made or deemed to
be made by any Loan Party under this Agreement, any other Loan Document or any
Foreign Facility Debt Agreement or any amendment hereto or thereto, shall at any
time prove to have been incorrect or misleading in any material respect when
made.
(d) Default in Performance. The Borrower shall default in the
performance or observance of any term, covenant, condition or agreement to be
performed by the Borrower, contained in
(i) Articles 8, 9 or 12, or Sections 10.1 (insofar as it
requires the preservation of the corporate existence of the Borrower or
any Subsidiary), 10.8, 11.5 or 11.6 and the Agent shall have delivered
to the Borrower written notice of such default, or
(ii) this Agreement (other than as specifically provided for
otherwise in this Section 13.1) and such default shall continue for a
period of 30 days after written notice thereof has been given to the
Borrower by the Agent.
(e) Debt Cross-Default.
(i) The Borrower or any Subsidiary shall fail to pay when due
and payable the principal of or interest on any Debt (other than the
Loans, the Foreign Facility Debt, the Reimbursement Obligations or Debt
outstanding pursuant to the Securitization Documents) in an amount in
excess of $500,000,
(ii) the maturity of any such Debt shall have (A) been
accelerated in accordance with the provisions of any indenture,
contract or instrument providing for the creation of or concerning such
Debt, or (B) been required to be prepaid prior to the stated maturity
thereof, or
(iii) any event shall have occurred and be continuing which
would permit any holder or holders of such Debt, any trustee or agent
acting on behalf of such holder or holders or any other Person so to
accelerate such maturity, and the Borrower or such Subsidiary shall
have failed to cure such default prior to the expiration of any
applicable cure or grace period.
(f) Other Cross-Defaults. The Borrower or any of its Subsidiaries shall
default in the payment when due, or in the performance or observance, of any
obligation or condition of any agreement, contract or lease (other than this
Agreement, the Security Documents, any such agreement, contract or lease
relating to Debt or the Securitization Documents) if the existence of any such
defaults, singly or in the aggregate, could in the reasonable judgment of the
Agent have a Materially Adverse Effect.
(g) Voluntary Bankruptcy Proceeding. The Borrower or any of its
Subsidiaries shall
(i) commence a voluntary case under the federal bankruptcy
laws (as now or hereafter in effect),
(ii) file a petition seeking to take advantage of any other
laws, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding up or composition for adjustment of debts,
(iii) consent to or fail to contest in a timely and
appropriate manner any petition filed against it in an involuntary case
under such bankruptcy laws or other laws,
(iv) apply for or consent to, or fail to contest in a timely
and appropriate manner, the appointment of, or the taking of possession
by, a receiver, custodian, trustee, or liquidator of itself or of a
substantial part of its property, domestic or foreign,
(v) admit in writing its inability to pay its debts as
they become due,
(vi) make a general assignment for the benefit of
creditors, or
(vii) take any corporate action for the purpose of authorizing
any of the foregoing.
(h) Involuntary Bankruptcy Proceeding. A case or other proceeding
shall be commenced against the Borrower or any of its Subsidiaries in any court
of competent jurisdiction seeking
(i) relief under the federal bankruptcy laws (as now or
hereafter in effect) or under any other laws, domestic or foreign,
relating to bankruptcy, insolvency, reorganization, winding up or
adjustment of debts, or
(ii) the appointment of a trustee, receiver, custodian,
liquidator or the like of the Borrower, any of its Subsidiaries or of
all or any substantial part of the assets, domestic or foreign, of the
Borrower or any of its Subsidiaries,
and such case or proceeding shall continue undismissed or unstayed for a period
of 60 consecutive calendar days, or an order granting the relief requested in
such case or proceeding against the Borrower or any of its Subsidiaries
(including, but not limited to, an order for relief under such federal
bankruptcy laws) shall be entered.
(i) Loan Documents. Any event of default or "Event of Default" under
any other Loan Document or Foreign Facility Agreement shall occur or any Loan
Party shall default in the performance or observance of any material term,
covenant, condition or agreement contained in, or the payment of any other sum
covenanted to be paid by such Loan Party under, any such Loan Document or
Foreign Facility Agreement (and not specifically provided for in Section 13.1)
or any provision of this Agreement, of any other Loan Document after delivery
thereof hereunder, or of any Foreign Facility Agreement shall for any reason
cease to be valid and binding, other than a nonmaterial provision rendered
unenforceable by operation of law, or the applicable Loan Party or other party
thereto (other than the Agent or any Lender) shall so state in writing.
(j) Failure of Agreements. The Borrower shall challenge the validity
and binding effect of any provision of any Loan Document after delivery thereof
hereunder or shall state in writing its intention to make such a challenge, or
any Security Document, after delivery thereof hereunder, shall for any reason
(except to the extent permitted by the terms thereof) cease to create a valid
and perfected first priority Lien (except for Permitted Liens) on, or security
interest in, any of the Collateral purported to be covered thereby.
(k) Judgment. A final, unappealable judgment or order for the payment
of money in an amount that exceeds the uncontested insurance available therefor
by $500,000 or more shall be entered against the Borrower or any Subsidiary by
any court and such judgment or order shall continue undischarged or unstayed for
30 days.
(l) Attachment. A warrant or writ of attachment or execution or similar
process which exceeds $500,000 in value shall be issued against any property of
the Borrower or any Subsidiary and such warrant or process shall continue
undischarged or unstayed for 10 days.
(m) ERISA. Any ERISA Event shall occur with respect to any Benefit
Plan.
(n) Securitization. An "Event of Termination" under and as defined in
the Borrower RPA or the Investor RPA shall occur and be continuing for 10 days
or the Securitization Documents shall cease to be in full force and effect as to
a program amount of at least $20,000,000 or the "Termination Date" under and as
defined in the Borrower RPA or the Investor RPA shall occur.
(o) Senior Sub Debt. Any event shall occur or circumstance shall exist,
by reason of which the Borrower becomes obligated pursuant to the terms of 1997
Indenture to purchase or repurchase or to offer to purchase or repurchase any
Senior Sub Debt.
(p) Change of Control. Any "Change of Control" as defined in the
1997 Indenture as in effect on the Agreement Date shall occur.
SECTION 13.2 Remedies.
(a) Automatic Acceleration and Termination of Facilities. Upon the
occurrence of an Event of Default specified in Section 13.1(g) or (h), (i) the
principal of and the interest on the Loans and any Note at the time outstanding,
and all other amounts owed to the Agent or the Lenders under this Agreement, any
of the other Loan Documents, any foreign Facility Agreement and all other
Secured Obligations, shall thereupon become due and payable without presentment,
demand, protest, or other notice of any kind, all of which are expressly waived,
anything in this Agreement or any of the Loan Documents to the contrary
notwithstanding, and (ii) the Revolving Credit Facility and the right of the
Borrower to request Borrowings under this Agreement shall immediately terminate.
(b) Enforcement Notice. Upon the occurrence of an Event of Default
specified in Section 13.1(a), (b), (d)(i), (g), (h) or (o), the Agent shall at
the direction of all of the Lenders give an "Enforcement Notice" as defined in
the Intercreditor Agreement.
(c) Other Remedies. If any Event of Default shall have occurred, and
during the continuance of any Event of Default, the Agent may, and at the
direction of the Required Lenders in their sole and absolute discretion shall,
do any of the following:
(i) declare the principal of and interest on the Loans and any
Note at the time outstanding, and all other amounts owed to the Agent
or the Lenders under this Agreement or any of the other Loan Documents
and all other Secured Obligations, to be forthwith due and payable,
whereupon the same shall immediately become due and payable without
presentment, demand, protest or other notice of any kind, all of which
are expressly waived, anything in this Agreement or the Loan Documents
to the contrary notwithstanding;
(ii) terminate the Revolving Credit Facility and any other
right of the Borrower to request borrowings hereunder;
(iii) notify, or request the Borrower to notify, Funding to
make payment directly to the Agent under the Borrower RPA and otherwise
to exercise its rights as assignee of the Borrower's interest in the
Borrower RPA or, if the Collection Date (as defined in the Investor
RPA) has occurred, to notify Account Debtors of the assignment of
Receivables to settle or adjust disputes and claims directly with
Account Debtors and other obligors on Receivables for amounts and on
terms which the Agent considers advisable and in all such cases only
the net amounts received by the Agent, for the account of the Lenders,
in payment of such amounts, after deductions of costs and attorneys'
fees, shall constitute Collateral and the Borrower shall have no
further right to make any such settlements or adjustments or to accept
any returns of merchandise;
(iv) enter upon any premises in which Inventory or Equipment
may be located and, without resistance or interference by the Borrower,
take physical possession of any or all thereof and maintain such
possession on such premises or move the same or any part thereof to
such other place or places as the Agent shall choose, without being
liable to the Borrower on account of any loss, damage or depreciation
that may occur as a result thereof, so long as the Agent shall act
reasonably and in good faith;
(v) require the Borrower to and the Borrower shall, without
charge to the Agent or any Lender, assemble the Inventory and Equipment
and maintain or deliver it into the possession of the Agent or any
agent or representative of the Agent at such place or places as the
Agent may designate and as are reasonably convenient to both the Agent
and the Borrower;
(vi) at the expense of the Borrower, cause any of the
Inventory and Equipment to be placed in a public or field warehouse,
and the Agent shall not be liable to the Borrower on account of any
loss, damage or depreciation that may occur as a result thereof, so
long as the Agent shall act reasonably and in good faith;
(vii) without notice, demand or other process, and without
payment of any rent or any other charge, enter any of the Borrower's
premises and, without breach of the peace, until the Agent, on behalf
of the Lenders, completes the enforcement of its rights in the
Collateral, take possession of such premises or place custodians in
exclusive control thereof, remain on such premises and use the same and
any of the Borrower's Equipment, for the purpose of (A) completing any
work in process, preparing any Inventory for disposition and disposing
thereof, and (B) collecting any Receivable, and the Agent for the
benefit of the Lenders is hereby granted a license or sublicense and
all other rights as may be necessary, appropriate or desirable to use
the Proprietary Rights in connection with the foregoing, and the rights
of the Borrower under all licenses, sublicenses and franchise
agreements shall inure to the Agent for the benefit of the Lenders
(provided, however, that any use of any federally registered trademarks
as to any goods shall be subject to the control as to the quality of
such goods of the owner of such trademarks and the goodwill of the
business symbolized thereby);
(viii) exercise any and all of its rights under any and all of
the Security Documents;
(ix) apply any cash Collateral to the payment of the Secured
Obligations or use such cash in connection with the exercise of any of
its other rights hereunder or under any of the Security Documents;
(x) establish or cause to be established one or more lockboxes
or other arrangement for the deposit of proceeds of Receivables, and,
in such case, the Borrower shall cause to be forwarded to the Agent at
the Agent's Office, on a daily basis, copies of all checks and other
items of payment and deposit slips related thereto deposited in such
lockboxes, together with collection reports in form and substance
satisfactory to the Agent; and
(xi) exercise all of the rights and remedies of a secured
party under the UCC and under any other Applicable Law, including,
without limitation, the right, without notice except as specified below
and with or without taking possession thereof, to sell the Collateral
or any part thereof in one or more parcels at public or private sale,
at any location chosen by the Agent, for cash, on credit or for future
delivery, and at such price or prices and upon such other terms as the
Agent may deem commercially reasonable. The Borrower agrees that, to
the extent notice of sale shall be required by law, at least 10 days'
notice to the Borrower of the time and place of any public sale or the
time after which any private sale is to be made shall constitute
reasonable notification, but notice given in any other reasonable
manner or at any other reasonable time shall constitute reasonable
notification. The Agent shall not be obligated to make any sale of
Collateral regardless of notice of sale having been given. The Agent
may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was
so adjourned.
SECTION 13.3 Application of Proceeds. All proceeds from each sale of,
or other realization upon, all or any part of the Collateral following an Event
of Default shall be applied or paid over as follows:
(a) First: to the payment of all costs and expenses incurred
in connection with such sale or other realization, including reasonable
attorneys' fees,
(b) Second: to the payment of the Secured Obligations (with the
Borrower remaining liable for any deficiency) ratably in accordance with the
principal amount of Secured Obligations owing to each Lender and otherwise in
any order the Required Lenders may elect, and
(c) Third: the balance (if any) of such proceeds shall be paid to the
Borrower, subject to any duty imposed by law, or otherwise to whomsoever shall
be entitled thereto.
The Borrower shall remain liable and will pay, on demand, any deficiency
remaining in respect of the Secured Obligations, together with interest thereon
at a rate per annum equal to the highest rate then payable hereunder on such
Secured Obligations, which interest shall constitute part of the Secured
Obligations. The principal amounts of all Secured Obligations (including those
that do not arise under the Notes) shall be pari passu.
SECTION 13.4 Power of Attorney. In addition to the authorizations
granted to the Agent under Section 9.13 or under any other provision of this
Agreement or of any other Loan Document during the continuance of an Event of
Default, the Borrower hereby irrevocably designates, makes, constitutes and
appoints the Agent (and all Persons designated by the Agent from time to time)
as the Borrower's true and lawful attorney, and agent in fact, and the Agent, or
any agent of the Agent, may, without notice to the Borrower, and at such time or
times as the Agent or any such agent in its sole discretion may determine, in
the name of the Borrower, the Agent or the Lenders,
(a) demand payment of Receivables,
(b) enforce payment of Receivables by legal proceedings or otherwise,
(c) exercise all of the Borrower's rights and remedies with respect to
the collection of Receivables,
(d) settle, adjust, compromise, extend or renew any or all Receivables,
(e) settle, adjust or compromise any legal proceedings brought to
collect Receivables,
(f) discharge and release Receivables or any of them,
(g) prepare, file and sign the name of the Borrower on any proof of
claim in bankruptcy or any similar document against any Account Debtor,
(h) prepare, file and sign the name of the Borrower on any notice of
Lien, assignment or satisfaction of Lien, or similar document in connection with
any of the Collateral,
(i) endorse the name of the Borrower upon any chattel paper, document,
instrument, notice, freight xxxx, xxxx of lading or similar document or
agreement relating to the Receivables, the Inventory or any other Collateral,
(j) use the stationery of the Borrower and sign the name of the
Borrower to verifications of the Receivables and on any notice to the Account
Debtors,
(k) open the Borrower's mail,
(l) notify the post office authorities to change the address for
delivery of the Borrower's mail to an address designated by the Agent, and
(m) use the information recorded on or contained in any data processing
equipment and computer hardware and software to which the Borrower has access
relating to the Receivables, Inventory or other Collateral.
SECTION 13.5 Miscellaneous Provisions Concerning Remedies.
(a) Rights Cumulative. The rights and remedies of the Agent and the
Lenders under this Agreement, the Notes and each of the Loan Documents shall be
cumulative and not exclusive of any rights or remedies which it or they would
otherwise have. In exercising such rights and remedies the Agent and the Lenders
may be selective and no failure or delay by the Agent or any Lender in
exercising any right shall operate as a waiver of it, nor shall any single or
partial exercise of any power or right preclude its other or further exercise or
the exercise of any other power or right.
(b) Waiver of Marshalling. The Borrower hereby waives any right to
require any marshalling of assets and any similar right.
(c) Limitation of Liability. Nothing contained in this Article 13 or
elsewhere in this Agreement or in any of the Loan Documents shall be construed
as requiring or obligating the Agent, any Lender or any agent or designee of the
Agent or any Lender to make any demand, or to make any inquiry as to the nature
or sufficiency of any payment received by it, or to present or file any claim or
notice or take any action, with respect to any Receivable or any other
Collateral or the monies due or to become due thereunder or in connection
therewith, or to take any steps necessary to preserve any rights against prior
parties, and the Agent, the Lenders and their agents or designees shall have no
liability to the Borrower for actions taken pursuant to this Article 13, any
other provision of this Agreement or any of the Loan Documents so long as the
Agent or such Lender shall act in good faith and in a commercially reasonable
manner and in good faith (as defined in the UCC).
ARTICLE 14
ASSIGNMENTS
SECTION 14.1 Successors and Assigns; Participations.
(a) This Agreement shall be binding upon and inure to the benefit of
the Borrower, the Lenders, the 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 Agreement without the prior
written consent of each Lender.
(b) Each Lender may with the consent of the Agent and (so long as no
Default or Event of Default has occurred and is continuing) the Borrower, which
consents shall not be unreasonably withheld, assign to one or more Eligible
Assignees all or a portion of its interests, rights and obligations under this
Agreement (including, without limitation, all or a portion of the Loans at the
time owing to it and the Notes held by it); provided, however, that (i) each
such assignment shall be of a constant, and not a varying, percentage of all the
assigning Lender's rights and obligations under this Agreement (other than the
Money Market Facility, which shall be retained by BankBoston), (ii) the amount
of the Commitment of the assigning Lender that is subject to each such
assignment (determined as of the date the Assignment and Acceptance with respect
to such assignment is delivered to the Agent) shall in no event be less than
$5,000,000, (iii) in the case of a partial assignment, the amount of the
Commitment that is retained by the assigning Lender (determined as of the date
the Assignment and Acceptance with respect to such assignment is delivered to
the Agent) shall in no event be less than $5,000,000, (iv) the parties to each
such assignment shall execute and deliver to the Agent, for its acceptance and
recording in the Register an Assignment and Acceptance, together with any Note
or Notes subject to such assignment and a fee in an amount equal to $3,000, (v)
such assignment shall not, without the consent of the Borrower, require the
Borrower to file a registration statement with the Securities and Exchange
Commission or apply to or qualify the Loans or the Notes under the blue sky laws
of any state, and (vi) the representation contained in Section 14.2 hereof shall
be true with respect to any such proposed assignee. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in each Assignment and Acceptance, which effective date shall be at least five
Business Days after the execution thereof, (A) the assignee thereunder shall be
a party hereto and, to the extent provided in such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder, and (B) the Lender
assignor thereunder shall, to the extent provided in such assignment, be
released from its obligations under this Agreement.
(c) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) other than the
representation and warranty that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim, such Lender
assignor makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with this Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any other
instrument or document furnished pursuant hereto; (ii) such Lender assignor
makes no representation or warranty and assumes no responsibility with respect
to the financial condition of the Borrower or the performance or observance by
the Borrower of any of its obligations under this Agreement or any other
instrument or document furnished pursuant hereto; (iii) such assignee confirms
that it has received a copy of this Agreement, together with copies of the
financial statements referred to in Section 7.1(n) and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Agent, such Lender assignor or any
other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement; (v) such assignee confirms that it is an
Eligible Assignee; (vi) such assignee appoints and authorizes the Agent to take
such action as agent on its behalf and to exercise such powers under this
Agreement and the other Loan Documents as are delegated to the Agent by the
terms hereof and thereof, together with such powers as are reasonably incidental
thereto; and (vii) such assignee agrees that it will perform in accordance with
their terms all of the obligations which by the terms of this Agreement are
required to be performed by it as a Lender.
(d) The Agent shall maintain a copy of each Assignment and Acceptance
delivered to it and a register for the recordation of the names and addresses of
the Lenders and the Commitment and Proportionate Share of, and principal amount
of the Loans and owing to, each Lender from time to time (the Register). The
entries in the Register shall be conclusive, in the absence of manifest error,
and the Borrower, the Agent and the Lenders may treat each person whose name is
recorded in the Register as a Lender hereunder for all purposes of this
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 an Assignment and Acceptance executed by an
assigning Lender and an Eligible Assignee together with any Note or Notes
subject to such assignment and the fee referred to above, the Agent shall, if
such Assignment and Acceptance has been completed and is in the form of Exhibit
D, (i) accept such Assignment and Acceptance, (ii) record the information
contained therein in the Register, (iii) give prompt notice thereof to the
Lenders and the Borrower, and (iv) promptly deliver a copy of such Acceptance
and Assignment to the Borrower. Within five Business Days after receipt of
notice, the Borrower shall execute and deliver to the Agent in exchange for the
surrendered Note or Notes a new Note or Notes to the order of such Eligible
Assignee in amounts equal to the Commitment assumed by such Eligible Assignee
pursuant to such Assignment and Acceptance and a new Note or Notes to the order
of the assigning Lender in an amount equal to the Commitment retained by it
hereunder. Such new Note or Notes shall be in an aggregate principal amount
equal to the aggregate principal amount of such surrendered Note or Notes, shall
be dated the effective date of such Assignment and Acceptance and shall
otherwise be in substantially the form of the assigned Notes. Each surrendered
Note or Notes shall be cancelled and returned to the Borrower.
(f) Each Lender may sell participations to one or more banks or other
entities in all or a portion of its rights and obligations under this Agreement
(including, without limitation, all or a portion of its Commitment hereunder and
the Loans owing to it and the Notes held by it); provided, however, that (i)
each such participation shall be in an amount not less than$5,000,000, (ii) such
Lender's obligations under this Agreement (including, without limitation, its
Commitment hereunder) shall remain unchanged, (iii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iv) such Lender shall remain the holder of the Notes held by it
for all purposes of this Agreement, (v) the Borrower, the Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement,
provided, that such Lender may agree with any participant that such Lender will
not, without such participant's consent, agree to or approve any waivers or
amendments which would reduce the principal of or the interest rate on any
Loans, extend the term or increase the amount of the commitments of such
participant, reduce the amount of any fees to which such participant is
entitled, extend any scheduled payment date for principal or release Collateral
securing the Loans (other than Collateral disposed of pursuant to Section 9.6
hereof or otherwise in accordance with the terms of this Agreement or the
Security Documents), and (vi) any such disposition shall not, without the
consent of the Borrower, require any Borrower to file a registration statement
with the Securities and Exchange Commission to apply to qualify the Loans or the
Notes under the blue sky law of any state. The Lender selling a participation to
any bank or other entity that is not an Affiliate of such Lender shall give
prompt notice thereof to the Borrower.
(g) Any Lender may, in connection with any assignment, proposed
assignment, participation or proposed participation pursuant to this Section
14.1, disclose to the assignee, participant, proposed assignee or proposed
participant, any information relating to the Borrower furnished to such Lender
by or on behalf of the Borrower, provided that, prior to any such disclosure,
each such assignee, proposed assignee, participant or proposed participant shall
agree with the Borrower or such Lender (which in the case of an agreement with
only such Lender, the Borrower shall be recognized as a third party beneficiary
thereof) to preserve the confidentiality of any confidential information
relating to the Borrower received from such Lender.
SECTION 14.2 Representation of Lenders. Each Lender hereby represents
that it will make each Loan hereunder as a commercial loan for its own account
in the ordinary course of its business; provided, however, that subject to
Section 14.1 hereof, the disposition of the Notes or other evidence of the
Secured Obligations held by any Lender shall at all times be within its
exclusive control.
ARTICLE 15
AGENT
SECTION 15.1 Appointment of Agent. Each of the Lenders hereby
irrevocably designates and appoints BankBoston, N.A. as the Agent of such Lender
under this Agreement and the other Loan Documents, and each Lender irrevocably
authorizes the Agent, as the Agent for such Lender, to take such action on its
behalf under the provisions of this Agreement and the other Loan Documents and
the Intercreditor Agreement and to exercise such powers and perform such duties
as are expressly delegated to the Agent by the terms of this Agreement and such
other Loan Documents, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere in
this Agreement or the other Loan Documents, the Agent shall not have any duties
or responsibilities, except those expressly set forth herein and therein, or any
fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or the other Loan Documents or otherwise exist against the Agent.
SECTION 15.2 Delegation of Duties. The Agent may execute any of its
duties under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by it with
reasonable care.
SECTION 15.3 Exculpatory Provisions. Neither the Agent nor any of its
trustees, officers, directors, employees, agents, attorneys-in-fact or
Affiliates shall be (i) liable to any Lender (or any Lender's participants) for
any action lawfully taken or omitted to be taken by it or such Person under or
in connection with this Agreement or the other Loan Documents (except for its or
such Person's own gross negligence or willful misconduct), or (ii) responsible
in any manner to any Lender (or any Lender's participants) for any recitals,
statements, representations or warranties made by the Borrower or any officer
thereof contained in this Agreement or the other Loan Documents or in any
certificate, report, statement or other document referred to or provided for in,
or received by the Agent under or in connection with, this Agreement or the
other Loan Documents or for the existence, value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or the other Loan
Documents or any Collateral or Lien or other interest therein or for any failure
of the Borrower to perform its obligations hereunder or thereunder. The Agent
shall not be under any obligation to any Lender to ascertain or to inquire as to
the observance or performance of any of the agreements contained in, or
conditions of, this Agreement, or to inspect the properties, books or records of
the Borrower.
SECTION 15.4 Reliance by Agent. The Agent shall be entitled to rely,
and shall be fully protected in relying, upon any Note, writing, resolution,
notice, consent, certificate, affidavit, letter, cablegram, telegram, telecopy,
telex or teletype message, statement, order or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrower), independent
accountants and other experts selected by the Agent. The Agent may deem and
treat the payee of any Note as the owner thereof for all purposes unless such
Note shall have been transferred in accordance with Section 14.1. The Agent
shall be fully justified in failing or refusing to take any action under this
Agreement and the other Loan Documents unless it shall first receive such advice
or concurrence of the Required Lenders as it deems appropriate and shall be
indemnified to its satisfaction by the Lenders against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action. The Agent shall in all cases be fully protected in acting, or
in refraining from acting, under this Agreement and the Notes in accordance with
a request of the Required Lenders, and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Lenders and all
future holders of the Notes.
SECTION 15.5 Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Agent has received notice from a Lender or the Borrower
referring to this Agreement, describing such Default or Event of Default and
stating that such notice is a "notice of default". In the event that the Agent
receives such a notice, the Agent shall promptly give notice thereof to the
Lenders. The Agent shall take such action with respect to such Default or Event
of Default as shall be reasonably directed by the Required Lenders; provided
that unless and until the Agent shall have received such directions, the Agent
may (but shall not be obligated to) continue making Revolving Credit Loans to
the Borrower on behalf of the Lenders in reliance on the provisions of Section
5.7 and take such other 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.
SECTION 15.6 Non-Reliance on Agent and Other Lenders; Securitization.
Each Lender expressly acknowledges that neither the Agent nor any of its
officers, directors, counsel, employees, agents, attorneys-in-fact or Affiliates
has made any representations or warranties to it and that no act by the Agent
hereafter taken, including any review of the affairs of the Borrower, shall be
deemed to constitute any representation or warranty by the Agent to any Lender.
Each Lender represents to the Agent that it has, independently and without
reliance upon the Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial (and other)
condition and creditworthiness of the Borrower and made its own decision to make
its Loans hereunder and enter into this Agreement. Each Lender also represents
that it will, independently and without reliance upon the Agent or any other
Lender, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit analysis, appraisals and decisions
in taking or not taking action under this Agreement and the other Loan
Documents, 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 Borrower. Each Lender expressly (i) acknowledges the
Securitization, receipt of a copy of the Intercreditor Agreement, and that the
Intercreditor Agreement, among other things, effects the release of Purchased
A/R from the Security Interest and (ii) authorizes the Agent to execute and
deliver the Intercreditor Agreement and to perform its obligations thereunder.
Except for notices, reports and other documents expressly required to be
furnished to the Lenders by the Agent hereunder or under the other Loan
Documents, the Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, operations,
property, financial (and other) condition or creditworthiness of the Borrower
which may come into the possession of the Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or Affiliates.
SECTION 15.7 Indemnification. The Lenders agree to indemnify the Agent
in its capacity as such (to the extent not reimbursed by the Borrower and
without limiting the obligation of the Borrower to do so), ratably according to
their respective Commitment Percentages, 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 Agent in any way relating to
or arising out of this Agreement or the other Loan Documents, or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the Agent under
or in connection with any of the foregoing; provided that no Lender shall be
liable for the payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting solely from the Agent's gross negligence or willful misconduct or
resulting solely from transactions or occurrences that occur at a time after
such Lender has assigned all of its interests, rights and obligations under this
Agreement pursuant to Section 14.1 or, in the case of a Lender to which an
assignment is made hereunder pursuant to Section 14.1, at a time before such
assignment. The agreements in this Section 15.7 shall survive the payment of the
Notes, the Secured Obligations and all other amounts payable hereunder and the
termination of this Agreement.
SECTION 15.8 Agent in Its Individual Capacity. The institution at the
time acting as the Agent and its Affiliates may make loans to, accept deposits
from and generally engage in any kind of business with the Borrower and the
Guarantor and their respective Subsidiaries as if it were not the Agent
hereunder. With respect to its Commitment, the Loans made or renewed by it and
any Note issued to it and any Letter of Credit issued by it, such institution
shall have and may exercise the same rights and powers under this Agreement and
the other Loan Documents and shall be subject to the same obligations and
liabilities as and to the extent set forth herein and in the other Loan
Documents for any other Lender. The terms "Lenders" and "Required Lenders" or
any other term shall, unless the context clearly otherwise indicates, include
such institution in its individual capacity as a Lender or one of the Required
Lenders.
SECTION 15.9 Successor Agent. The Agent may resign as Agent upon 30
days' notice to the Lenders and the Borrower. Upon any such resignation, the
Required Lenders shall have the right to appoint a successor Agent. If no
successor Agent shall have been so appointed by the Required Lenders and shall
have accepted such appointment within 30 days after any such notice of
resignation, then the retiring entity may, on behalf of the Lenders, appoint a
successor which shall be another Lender, if any other Lender is willing to serve
in such capacity, or, if not, a commercial bank organized under the laws of the
United States of America or any state thereof having a combined capital and
surplus of at least $250,000,000. After any such resignation, the provisions of
this Article 14 shall continue in effect for the benefit of the retiring entity
with respect to any actions taken or omitted by it while acting as Agent. The
term "Agent" shall mean such successor agent effective upon its appointment, and
the former Agent's rights, powers and duties as Agent shall be terminated,
without any other or further act or deed on the part of such former Agent or any
of the parties to this Agreement or any holders of the Notes. After any retiring
Agent's resignation hereunder as Agent, the provisions of Section 15.7 shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Agent under this Agreement.
SECTION 15.10 Notices from Agent to Lenders. The Agent shall promptly,
upon receipt thereof, forward to each Lender copies of any written notices,
reports or other information supplied to it by the Borrower (but which the
Borrower is not required to supply directly to the Lenders).
SECTION 15.11 Reliance by Borrower. The Borrower shall not be obligated
to ascertain the authority of the Agent to act on behalf of the Lenders in
connection with any of the matters governed or contemplated by this Agreement,
or to inquire as to the satisfaction of any conditions precedent to the exercise
of such authority. The Borrower shall be entitled to rely, and shall be fully
protected in relaying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document believed by it to be genuine and
correct and to have been signed or delivered by the Agent on behalf of the
Lenders.
ARTICLE 16
MISCELLANEOUS
SECTION 16.1 Notices.
(a) Method of Communication. Except as specifically provided in this
Agreement or in any of the other Loan Documents, all notices and the
communications hereunder and thereunder shall be in writing or by telephone,
subsequently confirmed in writing. Notices in writing shall be delivered
personally or sent by certified or registered mail, postage pre-paid, or by
overnight courier, telex or facsimile transmission and shall be deemed received
in the case of personal delivery, when delivered, in the case of mailing, when
receipted for, in the case of overnight delivery, on the next Business Day after
delivery to the courier, and in the case of telex and facsimile transmission,
upon confirmation of transmission during business hours (or if not during
business hours, on the next Business Day), provided that in the case of notices
to the Agent, notice shall be deemed to have been given only when such notice is
actually received by the Agent. A telephonic notice to the Agent, as understood
by the Agent, will be deemed to be the controlling and proper notice in the
event of a discrepancy with or failure to receive a confirming written notice.
(b) Addresses for Notices. Notices to any party shall be sent to it at
the following addresses, or any other address of which all the other parties are
notified in writing by such first party:
If to the Borrower: Synthetic Industries, Inc.
000 XxXxxxxxx Xxxx
Xxxxxxxxxxx, Xxxxxxx 00000
Attn: Xxxxxx Xxxxxxxxx
Facsimile No.: (000) 000-0000
If to the Agent: BankBoston, N.A.
000 Xxxxxxxxx Xxxxxx Xxxxx, X.X.
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. XxXxxxx
Facsimile No.: (000) 000-0000
If to a Lender: At the address of such Lender
set forth on the signature pages hereof.
(c) Agent's Office. The Agent hereby designates its office located at
000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or any subsequent office which
shall have been specified for such purpose by written notice to the Borrower, as
the office to which payments due are to be made and at which Loans will be
disbursed.
SECTION 16.2 Expenses. The Borrower will pay all reasonable
out-of-pocket expenses of the Agent and any Affiliate of the Agent in
connection with
(a) the preparation, execution and delivery of this Agreement and each
of the Loan Documents and each of the Foreign Facility Agreements, whenever the
same shall be executed and delivered, including appraisers' fees, fees in
connection with environmental site assessments, search fees, recording fees,
taxes, title insurance premium and the fees and disbursements of special counsel
for the Agent and of each local counsel retained by the Agent,
(b) the preparation, execution and delivery of any waiver, amendment or
consent relating to this Agreement, the Notes or any of the Loan Documents or
any Foreign Facility Agreements or the process of a Person becoming a Lender
hereunder, including reasonable attorneys' fees and disbursements, search fees,
recording fees, taxes and title insurance premiums,
(c) consulting with one or more Persons, including appraisers,
accountants and lawyers, concerning or related to the nature, scope or value of
any right or remedy hereunder or under any of the Loan Documents or under any of
the Foreign Facility Documents, including any review of factual matters in
connection therewith, which expenses shall include the fees and disbursements of
such Persons, and
(d) prosecuting or defending any claim in any way arising out of,
related to, or connected with, or enforcing any provision of, this Agreement or
any of the Loan Documents or any of the Foreign Facility Documents, which
expenses shall include the fees and disbursements of counsel and of experts and
other consultants retained by the Agent.
SECTION 16.3 Stamp and Other Taxes. The Borrower will pay any and all
stamp, registration, recordation and similar taxes, fees or charges and shall
indemnify the Agent and the Lenders against any and all liabilities with respect
to or resulting from any delay in the payment or omission to pay any such taxes,
fees or charges, which may be payable or determined to be payable in connection
with the execution, delivery, performance or enforcement of this Agreement and
any of the Loan Documents or the perfection of any rights or security interest
thereunder, including, without limitation, the Security Interest.
SECTION 16.4 Setoff. In addition to any rights now or hereafter granted
under Applicable Law and not by way of limitation of any such rights, during the
continuance of any Event of Default, each Lender, any participant with such
Lender in the Loans and each Affiliate of each Lender are hereby authorized by
the Borrower at any time or from time to time, without notice to the Borrower or
to any other Person, any such notice being hereby expressly waived, to set off
and to appropriate and to apply any and all deposits (general or special,
including, but not limited to, indebtedness evidenced by certificates of
deposit, whether matured or unmatured) and any other indebtedness at any time
held or owing by any Lender or any Affiliate of any Lender or any participant to
or for the credit or the account of the Borrower against and on account of the
Secured Obligations irrespective or whether or not
(a) the Agent or such Lender shall have made any demand under this
Agreement or any of the Loan Documents, or
(b) the Agent or such Lender shall have declared any or all of the
Secured Obligations to be due and payable as permitted by Section 13.2 and
although such Secured Obligations shall be contingent or unmatured.
SECTION 16.5 Litigation. THE BORROWER, THE AGENT AND EACH LENDER HEREBY
KNOWINGLY, INTENTIONALLY AND VOLUNTARILY WAIVE TRIAL BY JURY IN ANY ACTION OR
PROCEEDING OF ANY KIND OR NATURE IN ANY COURT IN WHICH AN ACTION MAY BE
COMMENCED BY OR AGAINST THE BORROWER, THE AGENT OR SUCH LENDER ARISING OUT OF
THIS AGREEMENT, THE COLLATERAL OR ANY ASSIGNMENT THEREOF OR BY REASON OF ANY
OTHER CAUSE OR DISPUTE WHATSOEVER BETWEEN THE BORROWER AND THE AGENT OR ANY
LENDER OF ANY KIND OR NATURE. THE BORROWER, THE AGENT AND THE LENDERS HEREBY
AGREE THAT THE FEDERAL COURT OF THE NORTHERN DISTRICT OF GEORGIA OR, AT THE
OPTION OF THE AGENT OR ANY LENDER, ANY COURT IN WHICH THE AGENT OR SUCH LENDER
SHALL INITIATE LEGAL OR EQUITABLE PROCEEDINGS AND WHICH HAS SUBJECT MATTER
JURISDICTION OVER THE MATTER IN CONTROVERSY, SHALL HAVE NONEXCLUSIVE
JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THE BORROWER
AND THE AGENT OR SUCH LENDER, PERTAINING DIRECTLY OR INDIRECTLY TO THIS
AGREEMENT OR THE LOAN DOCUMENTS OR TO ANY MATTER ARISING THEREFROM. THE BORROWER
EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR
PROCEEDING COMMENCED IN SUCH COURTS, HEREBY WAIVING PERSONAL SERVICE OF THE
SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN AND AGREEING
THAT SERVICE OF SUCH SUMMONS AND COMPLAINT OR OTHER PROCESS OR PAPERS MAY BE
MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE BORROWER AT THE ADDRESS OF
THE BORROWER SET FORTH IN SECTION 16.1. SHOULD THE BORROWER FAIL TO APPEAR OR
ANSWER ANY SUMMONS, COMPLAINT, PROCESS OR PAPERS SO SERVED WITHIN THIRTY (30)
DAYS AFTER THE MAILING THEREOF, IT SHALL BE DEEMED IN DEFAULT AND AN ORDER
AND/OR JUDGMENT MAY BE ENTERED AGAINST IT AS DEMANDED OR PRAYED FOR IN SUCH
SUMMONS, COMPLAINT, PROCESS OR PAPERS. THE NONEXCLUSIVE CHOICE OF FORUM SET
FORTH IN THIS SECTION SHALL NOT BE DEEMED TO PRECLUDE THE ENFORCEMENT OF ANY
JUDGMENT OBTAINED IN SUCH FORUM OR THE TAKING OF ANY ACTION UNDER THIS AGREEMENT
TO ENFORCE SAME IN ANY APPROPRIATE JURISDICTION.
SECTION 16.6 Consent to Advertising and Publicity. With the prior
written consent of the Borrower, which consent shall not be unreasonably
withheld, the Agent, on behalf of the Lenders, may issue and disseminate to the
public information describing the credit accommodation entered into pursuant to
this Agreement, including the name and address of the Borrower, the amount,
interest rate, maturity, collateral for and a general description of the credit
facilities provided hereunder and of the Borrower's and its Subsidiaries'
businesses.
SECTION 16.7 Reversal of Payments. The Agent and each Lender shall have
the continuing and exclusive right to apply, reverse and re-apply any and all
payments to any portion of the Secured Obligations in a manner consistent with
the terms of this Agreement. To the extent the Borrower makes a payment or
payments to the Agent, for the account of the Lenders, or any Lender receives
any payment or proceeds of the Collateral for the Borrower's benefit, which
payment(s) or proceeds or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to 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
payment or proceeds received, the Secured Obligations or part thereof intended
to be satisfied shall be revived and continued in full force and effect, as if
such payment or proceeds had not been received by the Agent or such Lender.
SECTION 16.8 Injunctive Relief. The Borrower recognizes that, in the
event the Borrower fails to perform, observe or discharge any of its obligations
or liabilities under this Agreement, any remedy at law may prove to be
inadequate relief to the Agent and the Lenders; therefore, the Borrower agrees
that if any Event of Default shall have occurred and be continuing, the Agent
and the Lenders, if the Agent or any Lender so requests, shall be entitled to
temporary and permanent injunctive relief without the necessity of proving
actual damages.
SECTION 16.9 Accounting Matters. All financial and accounting
calculations, measurements and computations made for any purpose relating to
this Agreement, including, without limitation, all computations utilized by the
Borrower to determine whether it is in compliance with any covenant contained
herein, shall, unless this Agreement otherwise provides or unless Required
Lenders shall otherwise consent in writing, be performed in accordance with
GAAP.
SECTION 16.10 Amendments.
(a) Except as set forth in subsection (b) below, any term, covenant,
agreement or condition of this Agreement or any of the other Loan Documents may
be amended or waived, and any departure therefrom may be consented to by the
Required Lenders, if, but only if, such amendment, waiver or consent is in
writing signed by the Required Lenders and, in the case of an amendment (other
than an amendment described in Section 16.10(d)), by the Borrower, provided that
no such amendment, unless consented to by the Agent, shall alter or affect the
rights or responsibilities of the Agent, and in any such event, the failure to
observe, perform or discharge any such term, covenant, agreement or condition
(whether such amendment is executed or such waiver or consent is given before or
after such failure) shall not be construed as a breach of such term, covenant,
agreement or condition or as a Default or an Event of Default. Unless otherwise
specified in such waiver or consent, a waiver or consent given hereunder shall
be effective only in the specific instance and for the specific purpose for
which given. In the event that any such waiver or amendment is requested by the
Borrower, the Agent and the Lenders may require and charge a fee in connection
therewith and consideration thereof in such amount as shall be determined by the
Agent and the Required Lenders in their discretion.
(b) Without the prior unanimous written consent of the Lenders,
(i) no amendment, consent or waiver shall (A) affect the
amount or extend the time of the obligation of any Lender to make Loans
or (B) extend the originally scheduled time or times of payment of the
principal of any Loan or (C) alter the time or times of payment of
interest on any Loan or of any fees payable for the account of the
Lenders or (D) alter the amount of the principal of any Loan or the
rate of interest thereon or (E) alter the amount of any commitment fee
or other fee payable hereunder for the account of the Lenders or (F)
permit any subordination of the principal of or interest on any Loan or
(G) permit the subordination of the Security Interests in any
Collateral,
(ii) no Collateral shall be released except as expressly
contemplated by this Agreement (including, without being limited to, by
the provisions of Section 12.7) or any Security Document, nor shall the
Borrower or any other Loan Party be released from its liability for the
Secured Obligations or Foreign Facility Debt, as the case may be,
(iii) none of the provisions of this Section 16.10, the
definitions "Lenders" or "Required Lenders", or the provisions of
Article 13 shall be amended, and
(iv) neither the Agent nor any Lender shall consent to any
amendment to or waiver of the amortization, deferral or subordination
provisions of any Subordinated Debt or any other instrument or
agreement evidencing or relating to obligations of the Borrower that
are expressly subordinate to any of the Secured Obligations or to any
amendment or waiver of any provision of the Securitization Documents,
if, in any case, such amendment or waiver would be adverse to the
Lenders in their capacities as Lenders hereunder;
provided, however, that anything herein to the contrary notwithstanding, the
Required Lenders shall have the right to waive any Default or Event of Default
and the consequences hereunder of such Default or Event of Default provided only
that such Default or Event of Default does not arise under Section 13.1(g) or
(h) or out of a breach of or failure to perform or observe any term, covenant or
condition of this Agreement or any other Loan Document (other than the other
provisions of Article 13 of this Agreement) the amendment of which requires the
unanimous consent of the Lenders. The Required Lenders shall have the right,
with respect to any Default or Event of Default that may be waived by them, to
enter into an agreement with the Borrower or the Guarantor providing for the
forbearance from the exercise of any remedies provided hereunder or under the
other Loan Documents without thereby waiving any such Default or Event of
Default.
(c) The making of Loans hereunder by the Lenders during the existence
of a Default or Event of Default shall not be deemed to constitute a waiver of
such Default or Event of Default.
(d) Notwithstanding any provision of this Agreement or the other Loan
Documents to the contrary, no consent, written or otherwise, of the Borrower
shall be necessary or required in connection with any amendment to Article 15
(other than Section 15.11), and any amendment to such provisions may be effected
solely by and among the Agent and the Lenders, provided that no such amendment
shall impose any obligation on the Borrower.
SECTION 16.11 Assignment. All the provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Borrower may not assign or transfer any
of its rights under this Agreement.
SECTION 16.12 Performance of Borrower's Duties.
(a) The Borrower's obligations under this Agreement and each of the
Loan Documents shall be performed by the Borrower at its sole cost and expense.
(b) If the Borrower shall fail to do any act or thing which it has
covenanted to do under this Agreement or any of the Loan Documents, the Agent,
on behalf of the Lenders, may (but shall not be obligated to) do the same or
cause it to be done either in the name of the Agent or the Lenders or in the
name and on behalf of the Borrower, and the Borrower hereby irrevocably
authorizes the Agent so to act.
SECTION 16.13 Indemnification. The Borrower agrees to reimburse the
Agent and each Lender and their respective officers, directors, employees and
agents, for all costs and expenses incurred by them, including reasonable
counsel fees and disbursements, and to indemnify and hold harmless the Agent and
the Lenders from and against all losses suffered by the Agent or any Lender in
connection with:
(a) the exercise by the Agent or any Lender of any right or remedy
granted to it under this Agreement or any of the Loan Documents,
(b) any claim, and the prosecution or defense thereof, arising out of
or in any way connected with this Agreement or any of the Loan Documents, and
(c) the collection or enforcement of the Secured Obligations or
any of them, other than such costs, expenses and liabilities arising out of
the Agent's or such Lender's gross negligence or willful misconduct.
SECTION 16.14 All Powers Coupled with Interest. All powers of attorney
and other authorizations granted to the Agent and the Lenders and any Persons
designated by the Agent or the Lenders pursuant to any provisions of this
Agreement or any of the Loan Documents shall be deemed coupled with an interest
and shall be irrevocable so long as any of the Secured Obligations remain unpaid
or unsatisfied or any Lender has any obligation to extend any financial
accommodation to the Borrower hereunder.
SECTION 16.15 Survival. Notwithstanding any termination of this Agreement,
(a) until all Secured Obligations have been irrevocably paid in full or
otherwise satisfied, the Agent, for the benefit of the Lenders, shall retain its
Security Interest and shall retain all rights under this Agreement and each of
the Security Documents with respect to such Collateral as fully as though this
Agreement had not been terminated,
(b) the indemnities to which the Agent and the Lenders are entitled
under the provisions of this Article 16 and any other provision of this
Agreement and the Loan Documents shall continue in full force and effect and
shall protect the Agent and the Lenders against events arising after such
termination as well as before, and
(c) in connection with the termination of this Agreement and the
release and termination of the Security Interests, the Agent, on behalf of
itself as agent and the Lenders, may require such assurances and indemnities as
it shall reasonably deem necessary or appropriate to protect the Agent and the
Lenders against loss on account of such release and termination, including,
without limitation, with respect to credits previously applied to the Secured
Obligations that may subsequently be reversed or revoked.
SECTION 16.16 Titles and Captions. Titles and captions of Articles,
Sections and subsections in this Agreement are for convenience only, and neither
limit nor amplify the provisions of this Agreement.
SECTION 16.17 Severability of Provisions. Any provision of this
Agreement or any Loan Document which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective only to the extent
of such prohibition or unenforceability without invalidating the remainder of
such provision or the remaining provisions hereof or thereof or affecting the
validity or enforceability of such provision in any other jurisdiction.
SECTION 16.18 Governing Law. This Agreement, the Notes and the Security
Documents (except to the extent otherwise expressly set forth therein) shall be
deemed to have been made in the State of Georgia and the validity, construction,
interpretation and enforcement hereof and thereof and the rights of the parties
hereto and thereto shall be determined under, governed by and construed in
accordance with the internal laws of the State of Georgia, without regard to
principles of conflicts of law, except that the waiver contained in the first
sentence of Section 16.5 shall be construed in accordance with and governed by
the internal laws of the jurisdiction in which any such action or proceeding is
commenced.
SECTION 16.19 Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and shall be
binding upon all parties, their successors and assigns, and all of which taken
together shall constitute one and the same agreement.
SECTION 16.20 Reproduction of Documents. This Agreement, each of the
Loan Documents and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by the Agent or any Lender, and (c) financial
statements, certificates and other information previously or hereafter furnished
to the Agent or any Lender, may be reproduced by the Agent or such Lender by any
photographic, photostatic, microfilm, microcard, miniature photographic or other
similar process and such Person may destroy any original document so produced.
Each party hereto stipulates that, to the extent permitted by Applicable Law,
any such reproduction shall be as admissible in evidence as the original itself
in any judicial or administrative proceeding (whether or not the original shall
be in existence and whether or not such reproduction was made by the Agent or
such Lender in the regular course of business), and any enlargement, facsimile
or further reproduction of such reproduction shall likewise be admissible in
evidence.
SECTION 16.21 Term of Agreement. This Agreement shall remain in effect
from the Agreement Date through the Termination Date and thereafter until all
Secured Obligations shall have been irrevocably paid and satisfied in full. No
termination of this Agreement shall affect the rights and obligations of the
parties hereto arising prior to such termination.
SECTION 16.22 Pro-Rata Participation.
(a) Each Lender agrees that if, as a result of the exercise of a right
of setoff, banker's lien or counterclaim or other similar right or the receipt
of a secured claim it receives any payment in respect of the Secured
Obligations, it shall promptly notify the Agent thereof (and the Agent shall
promptly notify the other Lenders). If, as a result of such payment, such Lender
receives a greater percentage of the Secured Obligations owed to it under this
Agreement than the percentage received by any other Lender, such Lender shall
purchase a participation (which it shall be deemed to have purchased
simultaneously upon the receipt of such payment) in the Secured Obligations then
held by such other Lenders so that all such recoveries of principal and interest
with respect to all Secured Obligations owed to each Lender shall be pro rata on
the basis of its respective amount of the Secured Obligations owed to all
Lenders, provided that if all or part of such proportionately greater payment
received by such purchasing Lender is thereafter recovered by or on behalf of
the Borrower from such Lender, such purchase shall be rescinded and the purchase
price paid for such participation shall be returned to such Lender to the extent
of such recovery, without interest to the extent such Lender was required to pay
interest upon such recovery.
(b) Each Lender which receives such a secured claim shall, to the
extent practicable, exercise its rights in respect of such secured claim in a
manner consistent with the rights of the Lenders entitled under this Section 16
to share in the benefits of any recovery on such secured claim.
(c) The Borrower expressly consents to the foregoing arrangements and
agrees that any holder of a participation in any Secured Obligation so purchased
or otherwise acquired of which the Borrower has received notice may exercise any
and all rights of banker's lien, set-off or counterclaim with respect to any and
all monies owing by the Borrower to such holder as fully as if such holder were
a holder of such Secured Obligation in the amount of the participation held by
such holder.
ARTICLE 17
GUARANTY OF FOREIGN FACILITY DEBT
SECTION 17.1 Guaranty. In consideration of the Foreign Facilities
provided by the Lenders or their Affiliates, the Borrower, as primary obligor
and not as surety merely, hereby irrevocably guarantees absolutely and
unconditionally to each Lender and each Affiliate thereof the due and punctual
payment, when and as due (whether upon demand, at maturity, by reason of
acceleration or otherwise) and performance, of the Foreign Facility Debt and all
other obligations arising under the Foreign Facility Agreements (collectively,
the Guaranteed Obligations) and agrees to pay any and all expenses (including,
but not limited to, reasonable legal fees and disbursements) which may be
incurred by the Agent or such Lender in collecting any or all of such amounts or
in enforcing any rights under this Guaranty or any of the Foreign Facility
Agreements. The liability of the Borrower under this Guaranty shall be unlimited
and unconditional, and this Guaranty shall be a continuing guaranty of all
obligations of the Foreign Subsidiaries under the Foreign Facility Debt and
Foreign Facility Agreements.
SECTION 17.2 Payment by Borrower. If any Foreign Subsidiary shall fail
to pay, when due and payable, any amount due to any Lender or any Affiliate of
such Lender under any Foreign Facility Debt, the Borrower will, without demand
or notice, immediately pay the same to the Agent for the account of such Lender
or Affiliate. If any Foreign Facility Debt would be subject to acceleration, but
such acceleration is enjoined or stayed, the Borrower will to the extent
permitted by Applicable Law, purchase such Foreign Facility Debt for a price
equal to the outstanding principal amount thereof, plus such accrued interest
and other amounts as would have been payable had such Foreign Facility Debt been
paid or prepaid at the time of such purchase. All payments by the Borrower under
this Guaranty shall be made without any setoff, counterclaim, or deduction
whatsoever, and in the same currency and funds as are required to be paid by the
Foreign Subsidiaries.
SECTION 17.3 Waiver. The Borrower, to the extent permitted by Applicable
Law,
(a) waives (i) diligence, presentment, demand, protest and notice of
any kind whatsoever, (ii) any requirement that the Agent or any Lender or any
Affiliate of any Lender exhaust any right or remedy or take any action against
any Foreign Subsidiary or any other Person which may be or become liable in
respect of all or any part of such amounts or obligations, or against any assets
of any Foreign Subsidiary or collateral security or guaranty therefor or right
of offset with respect thereto, and (iii) the benefit of all principles or
provisions of Applicable Law which are or might be in conflict with the terms of
this Guaranty, including, without limitation, Section 10-7-24 of the Official
Code of Georgia Annotated, and
(b) consents that the time of payment of any Foreign Facility Debt may
be extended or any provision of the Foreign Facility Agreements may be amended,
waived or modified without notice to or further assent from the Borrower and the
Borrower will remain bound under this Guaranty notwithstanding such changes,
extensions, amendments, waivers or modifications or any other circumstances,
whether or not referred to above, which might otherwise constitute a legal or
equitable discharge of a guaranty.
SECTION 17.4 Absolute Obligation. To the extent permitted by law,
the obligations of the Borrower hereunder are irrespective of and shall not
be dependent upon or affected by
(a) the validity, legality, regularity or enforceability of the Foreign
Facility Agreements or any of the obligations in respect thereof or any
collateral security or guaranty thereof,
(b) the existence, value or condition of any of the assets of any
Foreign Subsidiary,
(c) the validity, perfection or priority of any charge on or security
interest in the assets of any Foreign Subsidiary,
(d) any action or failure to take action by the Agent, any Lender or
any Affiliate of any Lender under, or with respect to, any of the Foreign
Facility Agreements,
(e) any right of offset with respect to Foreign Subsidiary Debt or
other obligations under the Foreign Facility Agreement at any time or from time
to time held by the Agent or any Lender or any Affiliate thereof and without
regard to any defense, setoff or counterclaim which may at any time be available
to or be asserted by the Borrower or any of the Foreign Subsidiaries against the
Agent or any Lender or any Affiliate thereof,
(f) any other dealings among the Agent, the Lenders, any Affiliate
thereof, the Borrower and the Foreign Subsidiaries,
(g) any present or future law or order of any government agency thereof
purporting to reduce, amend or otherwise affect any obligations of the Foreign
Subsidiaries, or
(h) any other circumstance whatsoever (with or without notice to or
knowledge of the Borrower or any Foreign Subsidiary) which constitutes, or might
be construed to constitute, an equitable or legal discharge of the Borrower or
such Foreign Subsidiary for any Foreign Subsidiary Debt or other obligations of
such Foreign Subsidiary under any Foreign Facility Agreements, in bankruptcy or
in any other instance.
SECTION 17.5 Payments Free and Clear of Taxes, Etc.
(a) All payments under this Guaranty shall be made free and clear of
and without deduction for any and all present and future taxes, levies, imposts,
deductions, charges, withholdings, and all liabilities with respect thereto,
excluding income and franchise taxes of the United States and of the
jurisdiction of the lending office of the appropriate Lender or Affiliate and
any political subdivision of either thereof (all such non-excluded taxes,
levies, imposts, deductions, charges, withholdings and liabilities being
hereinafter referred to as Taxes). Within 10 days after the date of each such
payment hereunder, the Borrower will also furnish to the appropriate Lender or
Affiliate the original or a certified copy of either a receipt for payment of
each of the Taxes payable in respect of such payment hereunder or, if no Taxes
are payable in respect of such payment, a certificate from each appropriate
taxing authority, or an opinion of counsel acceptable to such Lender or
Affiliate, in either case stating that such payment is exempt from or not
subject to Taxes.
(b) In addition, the Borrower will pay any United States taxes on the
acquisition of debt obligations of a Foreign Subsidiary and any stamp or other
taxes of any jurisdiction with respect to the execution, delivery, registration,
performance and enforcement of this Guaranty, Taxes specified in clause (a)
above and taxes of all jurisdictions with respect to any amounts paid under this
clause (b). If any Taxes specified in clause (a) above or any taxes mentioned in
this clause (b) are paid by a Lender or such Lender's Affiliate, the Borrower
will, upon demand of such Lender or Affiliate, and whether or not such Taxes or
taxes shall be correctly or legally asserted, indemnify such Lender or Affiliate
for such payments, together with any interest, penalties and expenses in
connection therewith plus interest thereon at the rate specified in Section 5.1
of this Agreement (calculated as if such payments constituted overdue amounts of
principal as of the date of the making of such payments).
SECTION 17.6 Currency Changes. The Borrower shall be liable to pay any
amount due hereunder in the currency in which, and at the place where, the
Foreign Subsidiaries are to pay that amount under the terms of the respective
Foreign Facility Agreement. If for the purposes of obtaining judgment in any
court in any country it becomes necessary to convert into any other currency
(the Judgment Currency), any amount in the currency due hereunder (the
Guaranteed Currency), then the conversion shall be made at the rate of exchange
prevailing either on the date when the guaranteed obligation shall have become
due or on the Business Day before the day on which judgment is given, whichever
shall be the more favorable to Lender or its Affiliate. In the event that there
is a change in the rate of exchange prevailing between the date when the
guaranteed obligation became due (or, as the case may be, the Business Day
before the day on which the judgment is given) and the date of payment of the
guaranteed obligation, whether such payment is by the Foreign Subsidiary or by
the Borrower, the Borrower will pay such additional amount (if any, but in any
event not a lesser amount) as may be necessary to insure that the amount paid on
such date is the amount in the Judgment Currency which, when converted at the
rate of exchange prevailing on the date of payment, is the amount then due in
accordance with this Guaranty in the Guaranteed Currency. Any amount due from
the Borrower under this Section 17.6 will be due as a separate debt and shall
not be affected by a judgment's being obtained for any other sums due under or
in respect of this Guaranty. For purposes of this Section 17.6, the rate of
exchange shall be the rate at which a Lender or its Affiliate is able on the
relevant date to purchase the Guaranteed Currency with the Judgment Currency and
includes any premiums and costs of exchange.
SECTION 17.7 Recovery of Payments. In the event that any or all of the
amounts guaranteed by the Borrower are or were paid by a Foreign Subsidiary or
are or were paid or reduced by application of the proceeds of any assets of the
Foreign Subsidiary, and all or any part of such payment is rescinded or must
otherwise be restored or recovered from any Lender or any Affiliate of a Lender
upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of
any of the Foreign Subsidiaries, or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or similar officer for, such
Foreign Subsidiary or any substantial part of its property, or otherwise, then
all as though such payment had not been made, the liability of the Borrower
under this Guaranty shall continue, or be reinstated, and shall remain in full
force and effect to the extent permitted by law.
SECTION 17.8 Subrogation. Any and all rights of subrogation or similar
rights which the Borrower may have against any Foreign Subsidiary or any assets
of any Foreign Subsidiary or against any other guarantor or any collateral
security held by the Agent or any Lender or any Affiliate of a Lender for the
payment of the obligations in respect of any Foreign Facility or otherwise shall
be subordinate to any and all rights which the Agent or any Lender or any such
Affiliate may have against such Foreign Subsidiary or any assets of such Foreign
Subsidiary or against such other guarantor or collateral security pursuant to
any Foreign Facility Agreement or otherwise and the Borrower will not enforce
any such right of subrogation or any similar right until all amounts guaranteed
by it hereunder have been paid in full.
SECTION 17.9 Consent to Amendments, Etc. The Borrower hereby consents
that, without the necessity of any reservation of rights against the Borrower
and without notice to or further assent by the Borrower, any demand for payment
of any of the obligations in respect of any Foreign Facility made by the Agent
or any Lender or any Affiliate thereof may be rescinded and any of such
obligations continued and such obligations, or the liability of any of the
Foreign Subsidiaries in respect thereof or any other Person upon or for any part
thereof, or any collateral security or guaranty therefor or right of offset with
respect thereto, may, from time to time, in whole or in part, be renewed,
extended, amended, modified, accelerated, compromised, waived, surrendered or
released by the Agent or any Lender or any Affiliate thereof and any obligation
under any Foreign Facility Debt or Foreign Facility Agreement, any collateral
security documents or guaranties or documents in connection herewith or
therewith may be amended, modified, supplemented or terminated, in whole or in
part, in accordance with the terms thereof, as the Agent and the Lenders and
their respective Affiliates may deem advisable from time to time, and any
collateral security or guaranty or right of offset at any time held by the Agent
or any Lender or any such Affiliate for the payment of such obligations may be
sold, exchanged, waived, surrendered or released, all without the necessity of
any reservation of rights against the Borrower and without notice to or further
assent by the Borrower, which will remain bound under this Section 17.9,
notwithstanding any such renewal, extension, modification, acceleration,
compromise, amendment, supplement, termination, sale, exchange, waiver,
surrender or release. Neither the Agent nor any Lender nor any of their
respective Affiliates shall have any obligation to protect, secure, perfect or
insure any other collateral security documents or property subject thereto at
any time held as security for such obligations. The Borrower waives any and all
notice of the creation, renewal, extension or accrual of any of the obligations
and notice of or proof of reliance by the Agent or any Lender or any such
Affiliate upon this Section 17.9, and such obligations, and any of them, shall
conclusively be deemed to have been created, contracted or incurred in reliance
upon this Section 17.9, and all dealings between such Foreign Subsidiary, the
Borrower, the Agent, the Lenders and such Affiliates shall likewise be
conclusively presumed to have been had or consummated in reliance upon this
Section 17.9.
SECTION 17.10 Binding Nature of Certain Adjudications. Upon written
notice of the institution by the Agent or any Lender of any action or
proceedings, legal or otherwise, for the adjudication of any controversy with
any Foreign Subsidiary, the Borrower will be conclusively bound by the
adjudication in any such action or proceedings and by any judgment, award or
decree entered therein. The Borrower waives the right to assert in any action or
proceeding brought by the Agent or any Lender or any Affiliate thereof, upon any
of the Foreign Facility Agreements, any offsets or counterclaims which the
Borrower may have with respect thereto; provided, however, that this Section
17.10 shall not prohibit the Borrower from bringing any action in its own name
under any Foreign Facility Agreement or from asserting any mandatory
counterclaim required to be asserted by Applicable Law.
SECTION 17.11 Validity and Enforceability of Guaranty. The Borrower
agrees that at any time and from time to time upon the written request of the
Agent or any Lender, the Borrower will execute and deliver such further
documents and do such further acts and things as the Agent or such Lender may
reasonably request in order to effect the purposes of this Article 17 and will
take all action required so that this Guaranty will at all times be a binding
obligation of the Borrower enforceable in accordance with its terms.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers in several counterparts all as of the
day and year first written above.
BORROWER:
SYNTHETIC INDUSTRIES, INC.,
By:
Name:
Title:
AGENT: BANKBOSTON, N.A.
By:
Name:
Title:
LENDERS:
BANKBOSTON, N.A.
By:
Name:
Title:
Address:
000 Xxxxxxxxx Xxxxxx Xxxxx, X.X.
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. XxXxxxx
Facsimile No. (000) 000-0000
SANWA BUSINESS CREDIT CORPORATION
By: Name:
Title: Address:
Attn:
Facsimile No.:
SOUTHTRUST BANK, NATIONAL ASSOCIATION
By: Name:
Title:
Address:
Attn:
Facsimile
No.:
$60,000,000
LOAN AND SECURITY AGREEMENT
Dated as of December 18, 1997
Between
SYNTHETIC INDUSTRIES, INC.
(the Borrower)
and
THE FINANCIAL INSTITUTIONS PARTY
HERETO FROM TIME TO TIME
(the Lenders)
and
BANKBOSTON, N.A.
(the Agent)
-----------------------------------
Arranger and Syndication Agent:
BANCBOSTON SECURITIES INC.
Doc. No. 15070.v9
i
||TABLE OF CONTENTS1/
ARTICLE 1 - DEFINITIONS 1
SECTION 1.1 Definitions.....................................1
SECTION 1.2 General Interpretive Rules.....................29
SECTION 1.3 Exhibits and Schedules.........................30
ARTICLE 2 - REVOLVING CREDIT FACILITY.........................................31
SECTION 2.1 Loans..........................................31
SECTION 2.2 Manner of Borrowing............................31
SECTION 2.3 Repayment of Loans.............................33
SECTION 2.4 Note...........................................33
ARTICLE 3 - LETTER OF CREDIT FACILITY.........................................34
SECTION 3.1 Agreement to Issue.............................34
SECTION 3.2 Amounts........................................34
SECTION 3.3 Conditions.....................................34
SECTION 3.4 Issuance of Letters of Credit..................35
SECTION 3.5 Duties of BankBoston...........................35
SECTION 3.6 Payment of Reimbursement Obligations...........36
SECTION 3.7 Participations.................................36
SECTION 3.8 Indemnification, Exoneration...................38
SECTION 3.9 Supporting Letter of Credit; Cash Collateral
Account........................................39
ARTICLE 4 - MONEY MARKET FACILITY.............................................41
SECTION 4.1 Money Market Loans.............................41
SECTION 4.2 Making Money Market Loans......................41
SECTION 4.3 Repayment of Money Market Loans................41
SECTION 4.4 Prepayment.....................................41
SECTION 4.5 Money Market Note..............................43
SECTION 4.6 Settlement with Other Lenders..................43
ARTICLE 5 - GENERAL LOAN PROVISIONS...........................................44
SECTION 5.1 Interest.......................................44
SECTION 5.2 Certain Fees...................................45
SECTION 5.3 Manner of Payment..............................46
SECTION 5.4 General........................................47
SECTION 5.5 Loan Accounts; Statements of Account...........47
SECTION 5.6 Reduction of Revolving Credit Facility;
Termination of Agreement.......................48
SECTION 5.7 Making of Loans................................48
SECTION 5.8 Settlement of Secured Obligations..............49
SECTION 5.9 Mandatory Prepayments..........................49
SECTION 5.10 Changed Circumstances..........................50
SECTION 5.11 Payments Not at End of Interest Period; Failure
to Borrow......................................52
SECTION 5.12 Assumptions Concerning Funding of Eurodollar Rate
Loans..........................................52
SECTION 5.13 Notice of Conversion or Continuation...........53
SECTION 5.14 Duration of Interest Periods; Maximum Number of
Eurodollar Rate Loans; Minimum Increments;
Maximum Number of Money Market Loans...........53
SECTION 5.15 Replacement of Lender..........................54
SECTION 5.16 Cash Collateral Account........................55
ARTICLE 6 - CONDITIONS PRECEDENT..............................................57
SECTION 6.1 Conditions Precedent to Loans..................57
SECTION 6.2 All Loans; Letters of Credit...................60
SECTION 6.3 Conditions as Covenants........................60
ARTICLE 7 - REPRESENTATIONS AND WARRANTIES OF BORROWER........................61
SECTION 7.1 Representations and Warranties.................61
SECTION 7.2 Survival of Representations and Warranties,
Etc............................................69
ARTICLE 8 - SECURITY INTEREST 71
SECTION 8.1 Security Interest..............................71
SECTION 8.2 Continued Priority of Security Interest........71
ARTICLE 9 - COLLATERAL COVENANTS..............................................73
SECTION 9.1 Collection of Receivables......................73
SECTION 9.2 Verification and Notification..................74
SECTION 9.3 Delivery of Instruments........................74
SECTION 9.4 Sales of Inventory.............................74
SECTION 9.5 Ownership and Defense of Title.................74
SECTION 9.6 Insurance......................................75
SECTION 9.7 Location of Offices and Collateral.............75
SECTION 9.8 Records Relating to Collateral.................76
SECTION 9.9 Inspection.....................................76
SECTION 9.10 Information and Reports........................76
SECTION 9.11 Power of Attorney..............................77
ARTICLE 10 - AFFIRMATIVE COVENANTS............................................78
SECTION 10.1 Preservation of Corporate Existence and Similar
Matters........................................78
SECTION 10.2 Compliance with Applicable Law.................78
SECTION 10.3 Maintenance of Property........................78
SECTION 10.4 Conduct of Business............................78
SECTION 10.5 Insurance......................................79
SECTION 10.6 Payment of Taxes and Claims....................79
SECTION 10.7 Accounting Methods and Financial Records.......79
SECTION 10.8 Use of Proceeds................................79
SECTION 10.9 Hazardous Waste and Substances; Environmental
Requirements...................................80
SECTION 10.10 Compliance with Securitization Documents.......80
SECTION 10.11 Subsidiary Guaranty............................80
ARTICLE 11 - INFORMATION 82
SECTION 11.1 Financial Statements...........................82
SECTION 11.2 Accountants' Certificate.......................83
SECTION 11.3 Officer's Certificate..........................83
SECTION 11.4 Copies of Other Reports........................83
SECTION 11.5 Notice of Litigation and Other Matters.........84
SECTION 11.6 ERISA..........................................85
SECTION 11.7 Revisions or Updates to Schedules..............85
ARTICLE 12 - NEGATIVE COVENANTS...............................................86
SECTION 12.1 Financial Ratios...............................86
SECTION 12.2 Debt...........................................87
SECTION 12.3 Guaranties.....................................88
SECTION 12.4 Investments....................................88
SECTION 12.5 Capital Expenditures...........................89
SECTION 12.6 Restricted Distributions and Payments, Etc.....90
SECTION 12.7 Merger, Consolidation and Sale of Assets.......90
SECTION 12.8 Transactions with Affiliates...................91
SECTION 12.9 Liens..........................................91
SECTION 12.10 Plans..........................................91
SECTION 12.11 Amendments to Other Agreements.................91
SECTION 12.12 Issuance of Stock by Subsidiaries..............91
ARTICLE 13 - DEFAULT 92
SECTION 13.1 Events of Default..............................92
SECTION 13.2 Remedies.......................................95
SECTION 13.3 Application of Proceeds........................97
SECTION 13.4 Power of Attorney..............................97
SECTION 13.5 Miscellaneous Provisions Concerning Remedies...98
ARTICLE 14 - ASSIGNMENTS 100
SECTION 14.1 Successors and Assigns; Participations........100
SECTION 14.2 Representation of Lenders.....................102
ARTICLE 15 - AGENT ..............................................103
SECTION 15.1 Appointment of Agent..........................103
SECTION 15.2 Delegation of Duties..........................103
SECTION 15.3 Exculpatory Provisions........................103
SECTION 15.4 Reliance by Agent.............................103
SECTION 15.5 Notice of Default.............................104
SECTION 15.6 Non-Reliance on Agent and Other Lenders;
Securitization................................104
SECTION 15.7 Indemnification...............................105
SECTION 15.8 Agent in Its Individual Capacity..............105
SECTION 15.9 Successor Agent...............................105
SECTION 15.10 Notices from Agent to Lenders.................106
SECTION 15.11 Reliance by Borrower..........................106
ARTICLE 16 - MISCELLANEOUS 107
SECTION 16.1 Notices.......................................107
SECTION 16.2 Expenses......................................108
SECTION 16.3 Stamp and Other Taxes.........................108
SECTION 16.4 Setoff........................................108
SECTION 16.5 Litigation....................................109
SECTION 16.6 Consent to Advertising and Publicity..........109
SECTION 16.7 Reversal of Payments..........................110
SECTION 16.8 Injunctive Relief.............................110
SECTION 16.9 Accounting Matters............................110
SECTION 16.10 Amendments....................................110
SECTION 16.11 Assignment....................................112
SECTION 16.12 Performance of Borrower's Duties..............112
SECTION 16.13 Indemnification...............................112
SECTION 16.14 All Powers Coupled with Interest..............112
SECTION 16.15 Survival......................................113
SECTION 16.16 Titles and Captions...........................113
SECTION 16.17 Severability of Provisions....................113
SECTION 16.18 Governing Law.................................113
SECTION 16.19 Counterparts..................................113
SECTION 16.20 Reproduction of Documents.....................114
SECTION 16.21 Term of Agreement.............................114
SECTION 16.22 Pro-Rata Participation........................114
ARTICLE 17 - GUARANTY OF FOREIGN FACILITY DEBT...............................116
SECTION 17.1 Guaranty......................................116
SECTION 17.2 Payment by Borrower...........................116
SECTION 17.3 Waiver........................................116
SECTION 17.4 Absolute Obligation...........................117
SECTION 17.5 Payments Free and Clear of Taxes, Etc.........117
SECTION 17.6 Currency Changes..............................118
SECTION 17.7 Recovery of Payments..........................118
SECTION 17.8 Subrogation...................................119
SECTION 17.9 Consent to Amendments, Etc....................119
SECTION 17.10 Binding Nature of Certain Adjudications.......120
SECTION 17.11 Validity and Enforceability of Guaranty.......120
ANNEX A COMMITMENTS
ANNEX B PRICING MATRIX
EXHIBIT A FORM OF REVOLVING CREDIT NOTE
EXHIBIT B FORM OF MONEY MARKET NOTE
EXHIBIT C FORM OF MONEY MARKET LOAN REQUEST
EXHIBIT D FORM OF ASSIGNMENT AND ACCEPTANCE
EXHIBIT E FORM OF GUARANTY AGREEMENT
EXHIBIT F FORM OF COMPLIANCE CERTIFICATE
Schedule 1.1A Forms of RPA Receivable Agreement/Invoice
Schedule 1.1B Permitted Investments
Schedule 1.1C Permitted Liens
Schedule 7.1(a) Organization
Schedule 7.1(b) Capitalization
Schedule 7.1(c) Subsidiaries
Schedule 7.1(e) Compliance of Agreement, Notes, Loan Documents and
Borrowing With Laws, etc.
Schedule 7.1(g) Compliance with Laws; Governmental Approvals
Schedule 7.1(h) Title to Properties
Schedule 7.1(i) Liens
Schedule 7.1(j) Debt and Guaranties
Schedule 7.1(k) Litigation
Schedule 7.1(l) Tax Matters
Schedule 7.1(p) ERISA
Schedule 7.1(t) Chief Executive Office
Schedule 7.1(u) Location of Inventory
Schedule 7.1(v) Equipment
Schedule 7.1(w) Real Estate
Schedule 7.1(x) Corporate and Fictitious Names
Schedule 7.1(aa) Proprietary Rights
Schedule 7.1(bb) Trade Names
Schedule 10.8 Use of Proceeds||
1/ This Table of Contents is included for reference purposes only and does not
constitute part of the Loan and Security Agreement.
