EXHIBIT 10.63
$240,000,000
CREDIT AGREEMENT
DATED AS OF NOVEMBER 24, 2003,
AMONG
GENERAL CABLE INDUSTRIES, INC.,
AS BORROWER,
GENERAL CABLE CORPORATION
AND
THE OTHER GUARANTORS PARTY HERETO,
AS GUARANTORS,
THE LENDERS PARTY HERETO,
XXXXXXX XXXXX CAPITAL, A DIVISION OF
XXXXXXX XXXXX BUSINESS FINANCIAL SERVICES INC.,
AS COLLATERAL AGENT AND SYNDICATION AGENT,
FLEET CAPITAL CORPORATION,
GENERAL ELECTRIC CAPITAL CORPORATION AND
GMAC COMMERCIAL FINANCE LLC,
AS CO-DOCUMENTATION AGENTS,
XXXXXXX XXXXX CAPITAL, A DIVISION OF
XXXXXXX XXXXX BUSINESS FINANCIAL SERVICES INC., AND
UBS SECURITIES LLC,
AS JOINT LEAD ARRANGERS,
UBS AG, STAMFORD BRANCH,
AS ISSUING BANK AND ADMINISTRATIVE AGENT
AND
UBS LOAN FINANCE LLC,
AS SWINGLINE LENDER
TABLE OF CONTENTS
PAGE
----
ARTICLE I. DEFINITIONS..................................................................................... 2
SECTION 1.01 Defined Terms.................................................................... 2
SECTION 1.02 Classification of Loans and Borrowings........................................... 45
SECTION 1.03 Terms Generally.................................................................. 46
SECTION 1.04 Accounting Terms; GAAP........................................................... 46
ARTICLE II. THE CREDITS.................................................................................... 46
SECTION 2.01 Commitments...................................................................... 46
SECTION 2.02 Loans............................................................................ 47
SECTION 2.03 Borrowing Procedure.............................................................. 48
SECTION 2.04 Evidence of Debt; Repayment of Loans............................................. 49
SECTION 2.05 Fees............................................................................. 50
SECTION 2.06 Interest on Loans and Default Compensation....................................... 51
SECTION 2.07 Termination and Reduction of Commitments......................................... 52
SECTION 2.08 Interest Elections............................................................... 53
SECTION 2.09 [Intentionally Omitted].......................................................... 54
SECTION 2.10 Optional and Mandatory Prepayments of Loans...................................... 54
SECTION 2.11 Alternate Rate of Interest....................................................... 58
SECTION 2.12 Increased Costs.................................................................. 58
SECTION 2.13 Breakage Payments................................................................ 59
SECTION 2.14 Payments Generally; Pro Rata Treatment; Sharing of Set-offs...................... 60
SECTION 2.15 Taxes............................................................................ 61
SECTION 2.16 Mitigation Obligations; Replacement of Lenders................................... 63
SECTION 2.17 Swingline Loans.................................................................. 64
SECTION 2.18 Letters of Credit................................................................ 65
SECTION 2.19 Determination of Borrowing Base.................................................. 71
ARTICLE III. REPRESENTATIONS AND WARRANTIES................................................................ 75
SECTION 3.01 Organization; Powers............................................................. 76
SECTION 3.02 Authorization; Enforceability.................................................... 76
SECTION 3.03 Governmental Approvals; No Conflicts............................................. 76
SECTION 3.04 Financial Statements............................................................. 76
SECTION 3.05 Properties....................................................................... 77
SECTION 3.06 Equity Interests and Subsidiaries................................................ 80
SECTION 3.07 Litigation; Compliance with Laws................................................. 80
SECTION 3.08 Agreements....................................................................... 81
SECTION 3.09 Federal Reserve Regulations...................................................... 81
SECTION 3.10 Investment Company Act; Public Utility Holding Company Act....................... 81
SECTION 3.11 Use of Proceeds.................................................................. 81
i
SECTION 3.12 Taxes............................................................................ 81
SECTION 3.13 No Material Misstatements........................................................ 82
SECTION 3.14 Labor Matters.................................................................... 82
SECTION 3.15 Solvency......................................................................... 82
SECTION 3.16 Employee Benefit and Pension Plans............................................... 83
SECTION 3.17 Environmental Matters............................................................ 84
SECTION 3.18 Insurance........................................................................ 85
SECTION 3.19 Security Documents............................................................... 85
SECTION 3.20 Equity Financing Documents; Representations and Warranties in Agreement.......... 86
SECTION 3.21 [Intentionally Omitted.]......................................................... 86
SECTION 3.22 Location of Material Inventory................................................... 86
SECTION 3.23 Accuracy of Borrowing Base....................................................... 86
SECTION 3.24 Post-Audit Asset Dispositions.................................................... 87
SECTION 3.25 Holding Companies; Inactive Subsidiaries......................................... 87
SECTION 3.26 Common Enterprise................................................................ 87
ARTICLE IV. CONDITIONS TO CREDIT EXTENSIONS................................................................ 88
SECTION 4.01 Conditions to Initial Credit Extension........................................... 88
SECTION 4.02 Conditions to All Credit Extensions.............................................. 93
ARTICLE V. AFFIRMATIVE COVENANTS........................................................................... 94
SECTION 5.01 Financial Statements, Reports, etc............................................... 95
SECTION 5.02 Litigation and Other Notices..................................................... 97
SECTION 5.03 Existence; Businesses and Properties............................................. 98
SECTION 5.04 Insurance........................................................................ 98
SECTION 5.05 Obligations and Taxes............................................................ 99
SECTION 5.06 Employee Benefits and Pension Plans.............................................. 100
SECTION 5.07 Maintaining Records; Access to Properties and Inspections........................ 101
SECTION 5.08 Use of Proceeds.................................................................. 101
SECTION 5.09 Compliance with Environmental Laws; Environmental Reports........................ 101
SECTION 5.10 [Intentionally Omitted].......................................................... 101
SECTION 5.11 Additional Collateral; Additional Guarantors..................................... 101
SECTION 5.12 Security Interests; Further Assurances........................................... 103
SECTION 5.13 Information Regarding Collateral................................................. 104
SECTION 5.14 Post-Closing Collateral Matters.................................................. 104
SECTION 5.15 Borrowing Base-Related Reports................................................... 104
SECTION 5.16 Merger of Securitization Vehicle................................................. 106
SECTION 5.17 Maintenance of Foreign Credit Lines.............................................. 106
SECTION 5.18 Maintenance of Real Property..................................................... 107
ARTICLE VI. NEGATIVE COVENANTS............................................................................. 107
SECTION 6.01 Indebtedness..................................................................... 107
SECTION 6.02 Liens............................................................................ 110
ii
SECTION 6.03 Sale and Leaseback Transactions.................................................. 113
SECTION 6.04 Investment, Loan and Advances.................................................... 114
SECTION 6.05 Mergers, Consolidations, Sales of Assets and Acquisitions........................ 117
SECTION 6.06 Restricted Payments.............................................................. 118
SECTION 6.07 Transactions with Affiliates..................................................... 120
SECTION 6.08 Financial Covenants.............................................................. 120
SECTION 6.09 Limitation on Modifications of Indebtedness; Modifications of Certificate
of Incorporation, or Other Constitutive Documents, By-laws and Certain
Other Agreements, etc............................................................ 121
SECTION 6.10 Limitation on Certain Restrictions on Subsidiaries............................... 122
SECTION 6.11 Limitation on Issuance of Capital Stock.......................................... 122
SECTION 6.12 Limitation on Creation of Subsidiaries........................................... 123
SECTION 6.13 Business......................................................................... 123
SECTION 6.14 Limitation on Accounting Changes................................................. 124
SECTION 6.15 Fiscal Year...................................................................... 124
SECTION 6.16 No Negative Pledges.............................................................. 124
SECTION 6.17 Lease Obligations................................................................ 124
SECTION 6.18 Upstream Restrictions............................................................ 124
SECTION 6.19 Holdings Companies; Inactive Subsidiaries........................................ 124
SECTION 6.20 Material Agreements.............................................................. 125
ARTICLE VII. GUARANTEE..................................................................................... 125
SECTION 7.01 The Guarantee.................................................................... 125
SECTION 7.02 Obligations Unconditional........................................................ 125
SECTION 7.03 Reinstatement.................................................................... 127
SECTION 7.04 Subrogation; Subordination....................................................... 127
SECTION 7.05 Remedies......................................................................... 128
SECTION 7.06 Instrument for the Payment of Money.............................................. 128
SECTION 7.07 Continuing Guarantee............................................................. 128
SECTION 7.08 General Limitation on Guarantee Obligations...................................... 128
ARTICLE VIII. EVENTS OF DEFAULT............................................................................ 129
ARTICLE IX. COLLATERAL MATTERS; CASH COLLATERAL ACCOUNTS; APPLICATION OF COLLATERAL PROCEEDS............... 132
SECTION 9.01 Accounts and Account Collections................................................. 132
SECTION 9.02 Inventory; Field Audits and Appraisals........................................... 135
SECTION 9.03 Equipment, Real Property and Appraisals.......................................... 135
SECTION 9.04 Cash Collateral Account.......................................................... 136
SECTION 9.05 Application of Proceeds.......................................................... 136
ARTICLE X. THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT............................................... 137
SECTION 10.01 Appointment...................................................................... 137
iii
SECTION 10.02 Administrative Agent and Collateral Agent in Their Individual Capacity........... 139
SECTION 10.03 Exculpatory Provisions........................................................... 139
SECTION 10.04 Reliance by the Administrative Agent and the Collateral Agent.................... 139
SECTION 10.05 Delegation of Duties............................................................. 140
SECTION 10.06 Successor Administrative Agent and/or Collateral Agent........................... 140
SECTION 10.07 Non-Reliance on the Administrative Agent, the Collateral Agent or Other Lenders.. 141
SECTION 10.08 No Other Administrative Agent or Collateral Agent................................ 141
SECTION 10.09 Indemnification.................................................................. 141
SECTION 10.10 Overadvances..................................................................... 142
SECTION 10.11 Special Agent Advances........................................................... 142
ARTICLE XI. MISCELLANEOUS.................................................................................. 143
SECTION 11.01 Notices.......................................................................... 143
SECTION 11.02 Waivers; Amendment............................................................... 145
SECTION 11.03 Expenses; Indemnity.............................................................. 147
SECTION 11.04 Successors and Assigns........................................................... 148
SECTION 11.05 Survival of Agreement............................................................ 151
SECTION 11.06 Counterparts; Integration; Effectiveness......................................... 151
SECTION 11.07 Severability..................................................................... 151
SECTION 11.08 Right of Setoff.................................................................. 152
SECTION 11.09 Governing Law; Jurisdiction; Consent to Service of Process....................... 152
SECTION 11.10 Waiver of Jury Trial............................................................. 153
SECTION 11.11 Headings......................................................................... 153
SECTION 11.12 Confidentiality.................................................................. 153
SECTION 11.13 Interest Rate Limitation......................................................... 154
SECTION 11.14 Lender Addendum.................................................................. 154
SECTION 11.15 Dollar Equivalent Calculations................................................... 154
SECTION 11.16 Judgment Currency................................................................ 154
iv
ANNEXES
Annex I Applicable Margin
Annex II Lenders and Commitments
SCHEDULES
Schedule 1.01(a) Mortgaged Real Property
Schedule 1.01(b) Refinancing Indebtedness To Be Repaid
Schedule 1.01(c) Guarantors
Schedule 1.01(d) Eligible Equipment and Eligible Real Property
Schedule 1.01(e) Locations of Eligible Equipment
Schedule 1.01(f) Intercompany Agreements
Schedule 3.03 Governmental Approvals; Compliance with Laws
Schedule 3.05(b) Real Property; Maintenance and Repairs
Schedule 3.06(a) Subsidiaries
Schedule 3.06(c) Corporate Organizational Chart
Schedule 3.08(c) Material Agreements
Schedule 3.16 Canadian Pension Plans
Schedule 3.17 Environmental Matters
Schedule 3.18 Insurance
Schedule 3.22 Location of Material Inventory
Schedule 4.01(g) Local Counsel
Schedule 4.01(n) Landlord Access Agreements
Schedule 4.01(o)(iii) Title Insurance Amounts
Schedule 5.14 Post-Closing Matters
Schedule 6.01(b) Existing Indebtedness
Schedule 6.01(c) Existing Interest Rate Protection Agreements
Schedule 6.02(c) Existing Liens
Schedule 6.04(a) Existing Investments
Schedule 6.18 Holdings Companies; Inactive Subsidiaries
EXHIBITS
Exhibit A-1 Form of Administrative Questionnaire
Exhibit A-2 Form of Compliance Certificate
Exhibit A-3 Form of LC Request
Exhibit A-4 Form of Lender Addendum
Exhibit B Form of Assignment and Acceptance
Exhibit C Form of Borrowing Request
Exhibit D Form of Interest Election Request
Exhibit E Form of Joinder Agreement
Exhibit F Form of Landlord Lien Waiver and Access Agreement
Exhibit G Form of Mortgage
Exhibit H-1 Form of Revolving Note
v
Exhibit H-2 Form of Swingline Note
Exhibit I-1 Form of Perfection Certificate
Exhibit I-2 Form of Perfection Certificate Supplement
Exhibit J-1 Form of US Security Agreement
Exhibit J-2 Form of Canadian Security Agreement
Exhibit K-1 Form of Opinion of Blank Rome LLP
Exhibit K-2 Form of Opinion of Foreign Local Counsels
Exhibit K-3 Form of Opinion of Canadian Local Counsel
Exhibit K-4 Form of Opinion of Mexican Local Counsel
Exhibit L Form of Intercompany Note
Exhibit M Form of Solvency Certificate
Exhibit N Form of Borrowing Base Certificate
vi
CREDIT AGREEMENT
This CREDIT AGREEMENT (this "AGREEMENT") dated as of November 24, 2003, is among
GENERAL CABLE INDUSTRIES, INC., a Delaware corporation ("BORROWER"), the
Guarantors (such term and each other capitalized term used but not defined
herein having the meaning given to it in Article I), the Lenders, XXXXXXX XXXXX
CAPITAL a division of Xxxxxxx Xxxxx Business Financial Services Inc. and UBS
SECURITIES LLC, as joint lead arrangers (collectively, in such capacity,
"ARRANGERS"), XXXXXXX XXXXX CAPITAL, a division of Xxxxxxx Xxxxx Business
Financial Services Inc., as syndication agent (in such capacity, "SYNDICATION
AGENT"), FLEET CAPITAL CORPORATION, as a co-documentation agent (in such
capacity, a "CO-DOCUMENTATION AGENT"), GMAC COMMERCIAL FINANCE LLC, as a
co-documentation agent (in such capacity, a "CO-DOCUMENTATION AGENT"), GENERAL
ELECTRIC CAPITAL CORPORATION, as a co-documentation agent (in such capacity, a
"CO-DOCUMENTATION AGENT"), UBS LOAN FINANCE LLC, as a Lender and as swingline
lender (in such capacity, "SWINGLINE LENDER"), UBS AG, STAMFORD BRANCH, in its
individual capacity (in such capacity, "UBS"), as issuing bank (in such
capacity, "ISSUING BANK"), and as administrative agent (in such capacity,
"ADMINISTRATIVE AGENT") for the Lenders and XXXXXXX XXXXX CAPITAL, a division of
Xxxxxxx Xxxxx Business Financial Services Inc., in its individual capacity (in
such capacity, "MERRILL") and as collateral agent and as security trustee (in
such capacity, "COLLATERAL AGENT") for the Secured Parties.
WITNESSETH:
WHEREAS, Borrower has requested the Lenders to extend credit in the
form of Revolving Loans at any time and from time to time prior to the Maturity
Date, in an aggregate principal amount at any time outstanding not in excess of
$240.0 million, with a Revolving Exposure of no more than $160.0 million on the
Closing Date.
WHEREAS, a portion of the initial Revolving Loans, together with the
proceeds from concurrent offerings of approximately $277.0 million Qualified
Senior Notes, $100.0 million Convertible Preferred Stock and $39.0 million of
New Common Stock will be used to repay amounts outstanding under the existing
senior secured revolving credit facility, senior secured term loans and account
receivable asset-backed securitization facility of Holdings and certain of its
Affiliates, as well as to pay related fees and expenses, all pursuant to the
terms of the Transaction Documents. As more fully described herein, all of these
transactions are to be executed concurrently and are contingent on the
successful execution of each individual transaction and subsequent Revolving
Loans will be used to fund ongoing working capital and general corporate
purposes.
WHEREAS, Borrower has requested the Swingline Lender to make Swingline
Loans, at any time and from time to time prior to the Maturity Date, in an
aggregate principal amount at any time outstanding not in excess of $10.0
million.
WHEREAS, Borrower has requested the Issuing Bank to issue letters of
credit, in an aggregate face amount at any time outstanding not in excess of
$50.0 million, to support payment obligations incurred in the ordinary course of
business by Borrower and Borrowing Base Guarantors.
1
WHEREAS, the proceeds of the Loans are to be used in accordance with
Section 3.11.
NOW, THEREFORE, the Lenders are willing to extend such credit to
Borrower and the Issuing Bank is willing to issue letters of credit for the
account of Borrower on the terms and subject to the conditions set forth herein.
Accordingly, the parties hereto agree as follows:
ARTICLE I.
DEFINITIONS
SECTION 1.01 DEFINED TERMS. As used in this Agreement, the following
terms shall have the meanings specified below:
"ABR", when used in reference to any Loan or Borrowing, is used when
such Loan, or the Loans comprising such Borrowing, are bearing interest at a
rate determined by reference to the Alternate Base Rate.
"ABR BORROWING" shall mean a Borrowing comprised of ABR Loans.
"ABR LOAN" shall mean any ABR Revolving Loan.
"ABR REVOLVING BORROWING" shall mean a Borrowing comprised of ABR
Revolving Loans.
"ABR REVOLVING LOAN" shall mean any Revolving Loan bearing interest at
a rate determined by reference to the Alternate Base Rate in accordance with the
provisions of Article II.
"ACCOUNT DEBTOR" shall mean any Person who may become obligated to
another Person under, with respect to, or on account of, an Account.
"ACCOUNTING CHANGES" shall have meaning assigned to such term in
Section 1.04.
"ACCOUNTS" shall mean all "accounts," as such term is defined in the
UCC, in which any Person now or hereafter has rights, including, without
limitation, any and all rights to payment for the sale or lease of goods or
rendition of services, whether or not they have been earned by performance, in
each case, for purposes of calculating the Borrowing Base, net of any credits,
rebates or offsets owed by Borrower or Borrowing Base Guarantors to the
respective customer.
"ACQUISITION CONSIDERATION" shall mean the purchase consideration for
any Permitted Acquisition and all other payments paid to or for the benefit of
the seller by Holdings or any of its Subsidiaries in exchange for, or as part
of, or in connection with, any Permitted Acquisition, whether paid in cash or by
exchange of Equity Interests or of assets or otherwise and whether payable at or
prior to the consummation of such Permitted Acquisition or deferred for payment
at any future time, whether or not any such future payment is subject to the
occurrence of any contingency, and includes any and all payments representing
the purchase price and any assumptions of Indebtedness, "earn-outs" and other
agreements to make any payment the amount
2
of which is, or the terms of payment of which are, in any respect subject to or
contingent upon the revenues, income, cash flow or profits (or the like) of any
Person or business.
"ACQUISITION DEBT ISSUANCE" shall mean unsecured Indebtedness issued to
seller(s) or to or sold through financial institutions acceptable to the
Administrative Agent and the Collateral Agent in their collective reasonable
discretion as consideration for a Permitted Non-Loan Funded Acquisition in an
amount, on such terms (including ownership and structure of the Person being
acquired and the identity of all obligors with respect to such debt), and
subordinated to the Obligations in a manner and form satisfactory to the
Administrative Agent and the Collateral Agent in their collective reasonable
discretion as to right and time of payment and as to any other terms, rights and
remedies thereunder.
"ACTIVATION NOTICE" shall have the meaning assigned to such term in
Section 9.01(e)(ii).
"ADJUSTED LIBOR RATE" shall mean, with respect to any Eurodollar
Revolving Borrowing for any Interest Period, (a) an interest rate per annum
(rounded upward, if necessary, to the next 1/100 of 1%) determined by the
Administrative Agent to be equal to the LIBOR Rate for such Eurodollar Revolving
Borrowing in effect for such Interest Period divided by (b) 1 minus the
Statutory Reserves (if any) for such Eurodollar Revolving Borrowing for such
Interest Period.
"ADMINISTRATIVE AGENT" shall have the meaning assigned to such term in
the preamble hereto and includes each other Person appointed as the successor
pursuant to Article X.
"ADMINISTRATIVE AGENT FEES" shall have the meaning assigned to such
term in Section 2.05(b).
"ADMINISTRATIVE QUESTIONNAIRE" shall mean an Administrative
Questionnaire in the form of Exhibit A, or such other form as may be supplied
from time to time by the Administrative Agent.
"AFFILIATE" shall mean, when used with respect to a specified Person,
another Person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by or is under common Control with the Person
specified; provided, however, that, for purposes of Section 6.07, the term
"Affiliate" shall also include any Person that directly or indirectly owns more
than 20% of any class of Equity Interests of the Person specified or that is an
executive officer or director of the Person specified.
"AGREEMENT" shall have the meaning assigned to such term in the
preamble hereto.
"ALTERNATE BASE RATE" shall mean, for any day, a rate per annum
(rounded upward, if necessary, to the next 1/100 of 1%) equal to the greater of
(a) the Base Rate in effect on such day and (b) the Federal Funds Effective Rate
in effect on such day plus 0.50%. If the Administrative Agent shall have
determined (which determination shall be conclusive absent manifest error) that
it is unable to ascertain the Federal Funds Effective Rate for any reason,
including the inability or failure of the Administrative Agent to obtain
sufficient quotations in accordance with the terms of the definition thereof,
the Alternate Base Rate shall be determined without regard to clause (b) of the
preceding sentence until the circumstances giving rise to such inability no
3
longer exist. Any change in the Alternate Base Rate due to a change in the Base
Rate or the Federal Funds Effective Rate shall be effective on the effective
date of such change in the Base Rate or the Federal Funds Effective Rate,
respectively.
"APPLICABLE FEE" shall mean, for any day, with respect to any Revolving
Loan, 0.50%.
"APPLICABLE MARGIN" shall mean, for any day, with respect to any
Revolving Loan, the applicable percentage set forth in Annex I under the
appropriate caption.
"ARRANGERS" shall have the meaning assigned to such term in the
preamble hereto.
"ASSET SALE" shall mean (a) any conveyance, sale, lease, sublease,
assignment, transfer or other disposition (including by way of merger or
consolidation and including any sale and leaseback transaction) of any Property
(including stock of any Subsidiary of Holdings by the holder thereof) by
Holdings, Intermediate Holdings, Borrower or any of their Subsidiaries to any
Person other than Borrower or any Guarantor (excluding (i) Inventory sold in the
ordinary course of business, (ii) any sale or discount, in each case without
recourse, of accounts receivable arising in the ordinary course of business, but
only in connection with the compromise or collection thereof, (iii) disposals of
obsolete, uneconomical, negligible, worn out or surplus Property in the ordinary
course of business or (iv) sales of Cash Equivalents and marketable securities)
and (b) any issuance or sale by any Subsidiary of Holdings of its Equity
Interests to any Person (other than to Borrower or any Guarantor).
"ASSIGNMENT AND ACCEPTANCE" shall mean an assignment and acceptance
entered into by a Lender and an assignee, and accepted by the Administrative
Agent, in the form of Exhibit B, or such other form as shall be approved by the
Administrative Agent.
"ATTRIBUTABLE INDEBTEDNESS" shall mean, when used with respect to any
sale and leaseback transaction, as at the time of determination, the present
value (discounted at a rate equivalent to the then-current weighted average cost
of funds for borrowed money of Holdings and all of its Domestic Subsidiaries as
at the time of determination, compounded on a semi-annual basis) of the total
obligations of the lessee for rental payments during the remaining term of the
lease included in any such sale and leaseback transaction.
"BASE RATE" shall mean a variable per annum rate, as of any date of
determination, equal to the rate from time to time published in the "Money
Rates" section of The Wall Street Journal as being the "Prime Rate" (or, if more
than one rate is published as the Prime Rate, then the highest of such rates).
The Base Rate will change as of the date of publication in The Wall Street
Journal of a "Prime Rate" that is different from that published on the preceding
Business Day. In the event that The Wall Street Journal shall, for any reason,
fail or cease to publish the "Prime Rate," Administrative Agent shall choose a
reasonably comparable index or source to use as the basis for the Base Rate.
"BIA" shall mean the Bankruptcy and Insolvency Act (Canada), as the
same may be in effect from time to time.
"BLOCKED ACCOUNT" shall have the meaning assigned to such term in
Section 9.01(d).
4
"BOARD" shall mean the Board of Governors of the Federal Reserve System
of the United States.
"BORROWER" shall have the meaning assigned to such term in the preamble
hereto.
"BORROWING" shall mean (a) Revolving Loans of the same Class and Type,
made, converted or continued on the same date and, in the case of Eurodollar
Revolving Loans, as to which a single Interest Period is in effect, or (b) a
Swingline Loan.
"BORROWING BASE" shall mean at any time, subject to adjustment as
provided in Section 2.19, an amount equal to the lesser of:
(a) an amount equal to the sum of, without duplication:
(i) the book value of Eligible Accounts of Borrower
multiplied by the advance rate of 85%, plus
(ii) the lesser of (i) the advance rate of 60% of the Cost
of Eligible Inventory of Borrower or (ii) the advance rate of 85% of the Net
Recovery Cost Percentage multiplied by the Cost of Eligible Inventory of
Borrower, plus
(iii) the aggregate of all Incorporated Borrowing Bases,
plus
(iv) the Fixed Asset Loan Value of Borrower multiplied by
the FALV Amortization Factor; provided, that the Fixed Asset Loan Value of
Borrower shall in no event exceed $40.0 million, minus
(v) effective immediately upon notification thereof to
Borrower by the Collateral Agent, any Reserves established from time to time by
the Collateral Agent in the exercise of its reasonable credit judgment;
or
(b) the maximum amount permitted to be outstanding pursuant to
Section 4.10(b)(3) of the Qualified Senior Note Indenture.
Assets denominated in Canadian Dollars shall for purposes hereof be valued at
the Dollar Equivalents.
The Borrowing Base at any time shall be determined by reference to the most
recent Borrowing Base Certificate theretofore delivered to the Collateral Agent
and the Administrative Agent with such adjustments (subject to any Lender
approval required by Section 2.19)as the Collateral Agent deem appropriate in
its reasonable credit judgment to assure that the Borrowing Base is calculated
in accordance with the terms of this Agreement.
"BORROWING BASE CERTIFICATE" shall mean an Officers' Certificate from
Borrower, substantially in the form of, and containing the information
prescribed by, Exhibit N, delivered to the Administrative Agent and the
Collateral Agent setting forth Borrower's calculation of the
5
Borrowing Base (including the maximum amount permitted to be outstanding
pursuant to Section 4.10(b)(3) of the Qualified Senior Note Indenture).
"BORROWING BASE GUARANTOR" shall mean Holdings, Intermediate Holdings,
General Cable Canada, General Cable LLC, General Cable Texas, General Cable
Technologies and any other Wholly Owned Subsidiary of Borrower which may
hereafter be approved by Administrative Agent and Collateral Agent which (a) is
a Domestic Subsidiary or a Canadian Subsidiary, (b) is currently able to prepare
all collateral reports in a comparable manner to the Borrower's reporting
procedures and (c) has executed and delivered to Collateral Agent such joinder
agreements to guarantees, contribution and set-off agreements and other Security
Documents as Collateral Agent has reasonably requested so long as Collateral
Agent has received and approved, in its reasonable discretion, (i) a collateral
audit and Inventory Appraisal conducted by an independent appraisal or audit
firm designated by Collateral Agent and reasonably acceptable to Borrower and
(ii) all UCC or PPSA search results necessary to confirm Collateral Agent's
first priority Lien on all of such Borrowing Base Guarantor's personal Property,
subject to Permitted Liens.
"BORROWING BASE GUARANTOR INTERCOMPANY LOAN ACCOUNT" shall mean the sum
of (a) the net amount of any intercompany advances (including Letters of Credit
issued for the account or benefit of a Borrowing Base Guarantor) which are made
and are outstanding to or for the account of a Borrowing Base Guarantor from
Borrower and (b) interest accrued and unpaid on such amount at the rate per
annum equal to the Alternate Base Rate plus the Applicable Margin in effect from
time to time.
"BORROWING REQUEST" shall mean a request by Borrower in accordance with
the terms of Section 2.03 and substantially in the form of Exhibit C, or such
other form as shall be approved by the Administrative Agent.
"BUSINESS DAY" shall mean any day other than a Saturday, Sunday or
other day on which banks in New York City are authorized or required by law to
close; provided, however, that when used in connection with a Eurodollar
Revolving Loan, the term "Business Day" shall also exclude any day on which
banks are not open for dealings in Dollar deposits in the London interbank
market.
"CANADIAN" shall mean, as to any Person, a Person that is created or
organized under the laws of Canada or a Province or territory of Canada.
"CANADIAN BENEFIT PLANS" shall mean all material employee benefit
plans of any nature or kind whatsoever that are not Canadian Pension Plans and
are maintained or contributed to by any Loan Party having employees in Canada.
"CANADIAN DOLLARS" and the sign "CDN$" shall mean lawful currency of
Canada.
"CANADIAN GUARANTY" shall mean that certain Guarantee dated as of the
date hereof addressed to the Collateral Agent for the benefit of the Secured
Parties by General Cable Canada, and that certain Guarantee dated as of the date
hereof addressed to the Collateral Agent for the benefit of the Secured Parties
by General Cable Canada Ltd., an Ontario corporation, which are
6
governed by Canadian law, as the same may from time to time be modified,
amended, extended or reaffirmed in accordance with the terms hereof and with the
consent of Collateral Agent.
"CANADIAN PENSION PLANS" shall mean each plan which is considered to be
a pension plan for the purposes of any applicable pension benefits standards
statute and/or regulation in Canada established, maintained or contributed to by
any Loan Party for its employees or former employees and shall not mean the
Canadian Pension Plan that is maintained by the Government of Canada.
"CANADIAN PLEDGE AGREEMENTS" shall mean that certain ULC Securities
Pledge Agreement by General Cable Holdings, Inc., a Delaware corporation,
pledging all of its Equity Interests in General Cable Canada, that certain ULC
Securities Pledge Agreement by Marathon Manufacturing Holdings, Inc., a Delaware
corporation, pledging all of its Equity Interests in General Cable Canada, and
that certain ULC Securities Pledge Agreement General Cable Canada Ltd., an
Ontario corporation, pledging all of its Equity Interests in General Cable
Canada, each dated as of the date hereof addressed to Collateral Agent for the
benefit of the Secured Parties, as the same may from time to time be modified
amended, extended or reaffirmed in accordance with the terms hereof and with the
consent of Collateral Agent.
"CANADIAN PRIORITY PAYMENT RESERVE" shall mean, at any time, with
respect to General Cable Canada and any other Canadian Loan Party, the amount
past due and owing by any such Person, or the accrued amount for which any such
Person has an obligation to remit to a Governmental Authority or other Person
pursuant to any applicable law, rule or regulation, in respect of (i) pension
fund obligations; (ii) unemployment insurance; (iii) goods and services taxes;
sales taxes; employee income taxes and other taxes payable or to be remitted or
withheld; (iv) workers' compensation; (v) vacation pay; and (vi) other like
charges and demands; in each case, in respect of which any Governmental
Authority or other Person may claim a security interest, lien, trust or other
claim ranking or capable of ranking in priority to or pari passu with one or
more of the Liens granted in the Security Documents.
"CANADIAN SECURITY AGREEMENT" shall mean that certain Security
Agreement dated as of the date hereof addressed to the Collateral Agent for the
benefit of the Secured Parties by General Cable Canada, which is governed by
Canadian law, as the same may from time to time be modified, amended, extended
or reaffirmed in accordance with the terms hereof and with the consent of
Collateral Agent.
"CAPITAL EXPENDITURES" shall mean, with respect to any Person, for any
period, the aggregate amount of all expenditures by such Person and its
Subsidiaries during that period for fixed or capital assets that, in accordance
with GAAP, are or should be classified as capital expenditures in the
consolidated balance sheet of such Person and its Consolidated Subsidiaries.
"CAPITAL LEASE OBLIGATIONS" of any Person shall mean the obligations of
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) Property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance
with GAAP.
7
"CASH COLLATERAL ACCOUNT" shall have the meaning assigned to such term
in Section 9.04.
"CASH EQUIVALENTS" shall mean, as to any Person: (a) securities issued,
or directly, unconditionally and fully guaranteed or insured, by the United
States or any agency or instrumentality thereof (provided, that the full faith
and credit of the United States is pledged in support thereof) having maturities
of not more than one year from the date of acquisition by such Person; (b)
securities issued, or directly, unconditionally and fully guaranteed or insured,
by any state of the United States of America or any political subdivision of any
such state or any public instrumentality thereof maturing within one year from
the date of acquisition thereof and, at the time of acquisition, having one of
the two highest ratings obtainable from either Standard & Poor's Ratings Group
or Xxxxx'x Investors Services, Inc.; (c) time deposits and certificates of
deposit or bankers' acceptance of any Lender or any commercial bank having, or
which is the principal banking subsidiary of a bank holding company organized
under the laws of the United States, any state thereof or the District of
Columbia having, capital and surplus aggregating in excess of $500.0 million and
a rating of "A" (or such other similar equivalent rating) or higher by at least
one nationally recognized statistical rating organization (as defined in Rule
436 under the Securities Act) with maturities of not more than one year from the
date of acquisition by such Person; (d) repurchase obligations with a term of
not more than 30 days for underlying securities of the types described in
clauses (a) and (b) above entered into with any bank meeting the qualifications
specified in clauses (c) above, which repurchase obligations are secured by a
valid perfected security interest in the underlying securities; (e) commercial
paper issued by any Person incorporated in the United States rated at least A-1
or the equivalent thereof by Standard & Poor's Rating Service or at least P-1 or
the equivalent thereof by Xxxxx'x Investors Service, Inc., and in each case
maturing not more than one year after the date of acquisition by such Person;
(f) investments in money market funds substantially all of whose assets are
comprised of securities of the types described in clauses (a) through (e) above;
and (g) demand deposit accounts maintained in the ordinary course of business.
"CASH MANAGEMENT SYSTEM" shall have the meaning assigned to such term
in Section 9.01(e).
"CASUALTY EVENT" shall mean, with respect to any Property (including
Real Property) of any Person (other than a Person which is a Foreign Subsidiary
of Holdings) any loss of title with respect to such Property or any loss of or
damage to or destruction of, or any condemnation or other taking (including by
any Governmental Authority) of, such Property for which such Person or any of
its Subsidiaries (other than Foreign Subsidiaries) receives insurance proceeds
or proceeds of a condemnation award or other compensation. "Casualty Event"
shall include but not be limited to any taking of all or any part of any Real
Property of any such Person or any part thereof, in or by condemnation or other
eminent domain proceedings pursuant to any law, or by reason of the temporary
requisition of the use or occupancy of all or any part of any Real Property of
any such Person or any part thereof by any Governmental Authority, civil or
military.
"CCAA" shall mean the Companies' Creditors Agreement Act (Canada), as
the same may be in effect from time to time.
8
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, 42 U.S.C. Section 9601 et
seq.
"CHANGE IN CONTROL" shall be deemed to have occurred if: (a) any Person
or group (within the meanings of the Securities Exchange Act of 1934 and the
rules of the Securities and Exchange Commission thereunder as in effect on the
date hereof) acquires ownership, directly or indirectly, beneficially or of
record, of capital stock representing more than 30% of the aggregate ordinary
voting power represented by the issued and outstanding stock of Holdings, (b)
occupation of a majority of the seats (other than vacant seats) on the board of
directors of Holdings by Persons who were not (i) directors of Holdings on the
date hereof, (ii) nominated by the board of directors of Holdings, or (iii)
appointed by directors so nominated (it being understood that, in the absence of
an event described in clause (a) or (b), the replacement of one or more officers
of Holdings shall not in and of itself constitute a Change in Control), (c)
Holdings at any time ceases to own and control 100% of the capital stock of
Intermediate Holdings, (d) Intermediate Holdings at any time ceases to own and
control 100% of the capital stock of Borrower, (f) Holdings at any time ceases
to, directly or indirectly, own and control 100% of each class of the
outstanding equity interests of each Borrowing Base Guarantor and (g) at any
time a change of control occurs under and as defined in any documentation
relating to any Material Indebtedness.
"CHANGE IN LAW" shall mean (a) the adoption of any law, treaty, order,
rule or regulation after the date of this Agreement, (b) any change in any law,
treaty, order, rule or regulation or in the interpretation or application
thereof by any Governmental Authority after the date of this Agreement or (c)
compliance by any Lender or Issuing Bank (or for purposes of Section 2.12(b), by
any lending office of such Lender or by such Lender's or Issuing Bank's holding
company, if any) with any request, guideline or directive (whether or not having
the force of law) of any Governmental Authority made or issued after the date of
this Agreement.
"CHARGES" shall have the meaning assigned to such term in Section
11.13.
"CHATTEL PAPER" shall mean all "chattel paper," as such term is defined
in the UCC as in effect on the date hereof in the State of New York, in which
any Person now or hereafter has rights.
"CLASS", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans
or Swingline Loans and, when used in reference to any Commitment, refers to
whether such Commitment is a Revolving Commitment, Swingline Commitment or LC
Commitment.
"CLOSING DATE" shall mean the date of the initial Credit Extension
hereunder.
"CODE" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"COLLATERAL" shall mean, collectively, all of the Security Agreement
Collateral, the Mortgaged Real Property and all other Property of whatever kind
and nature pledged as collateral under any Security Document.
9
"COLLATERAL AGENT" shall have the meaning assigned to such term in the
preamble hereto and shall include the Collateral Agent in its capacity as
trustee for the Secured Parties solely for the purposes of English law in
respect of the Collateral which is the subject of the Security Documents and
Foreign Pledge Agreements governed by English law, and each other Person
appointed as the successor pursuant to Article X
"COLLATERAL AGENT FEE" shall have the meaning ascribed to such term in
Section 2.05(b)(ii).
"COLLECTION ACCOUNT" shall have the meaning assigned to such term in
Section 9.01(e)(i)
"COMMERCIAL LETTER OF CREDIT" shall mean any letter of credit or
similar instrument issued for the account of Borrower for the benefit of
Borrower or any Borrowing Base Guarantor, for the purpose of providing the
primary payment mechanism in connection with the purchase of materials, goods or
services by Borrower or any Borrowing Base Guarantor in the ordinary course of
their businesses.
"COMMITMENT" shall mean, with respect to any Lender, such Lender's
Revolving Commitment, LC Commitment or Swingline Commitment.
"COMMITMENT FEE" shall have the meaning assigned to such term in
Section 2.05(a).
"COMMITMENTS" shall mean the aggregate sum of each Lender's Commitment.
"COMPANIES" shall mean Holdings and its Subsidiaries; and "COMPANY"
shall mean any one of them.
"COMPLIANCE CERTIFICATE" shall mean a certificate of a Financial
Officer substantially in the form of Exhibit A-2.
"CONCENTRATION ACCOUNT" shall have the meaning assigned to such term in
Section 9.01(e)(i).
"CONCENTRATION ACCOUNT BANK" shall have the meaning assigned to such
term in Section 9.01(e)(i).
"CONFIDENTIAL INFORMATION MEMORANDA" shall mean (a) that certain
confidential offering memorandum dated as of November 19, 2003 with respect to
the proposed issuance by Holdings of the Qualified Senior Notes, (b) that
certain confidential offering memorandum dated as of November 19, 2003 with
respect to the proposed issuance by Holdings of the Convertible Preferred Stock
and (c) that certain prospectus supplement dated as of November 19, 2003 with
respect to the proposed issuance by Holdings of its New Common Stock.
"CONSOLIDATED COMPANIES" shall mean Holdings and its Consolidated
Subsidiaries.
"CONSOLIDATED EBITDA" shall mean, for any applicable measurement
period, Consolidated Net Income for such period, as adjusted by adding thereto
(a) any provision for (or less any benefit from) income and franchise taxes
included in the determination of net income
10
for such period, (b) the amount of Consolidated Interest Expense, (c)
amortization and depreciation deducted in the determination of net income for
such period, (d) amortization of debt discount and deferred financing costs,
capitalized interest, interest paid in kind, (e) losses (or less gains) from
Asset Sales included in the determination of net income for such period
(excluding sales expenses or losses related to current assets), (f) other
non-cash losses (or less gains) included in the determination of net income for
such period and for which no cash outlay (or cash receipt) is foreseeable, (g)
employee severance and other unusual charges of up to $30.0 million in the
aggregate for such period, to the extent recorded for the financial reporting
purposes prior to the first anniversary of the Closing Date and relating to
closures of plants located at (i) 00 Xxxxxxx Xx., Xxxxxxx XX 00000, (ii) 000
Xxxx 0xx Xxxxxx, Xxxxxx, XX 00000 and (iii) 00 Xxxxx Xx., Xxxxx Xxxxxx, XX
00000, and (h) with the consent of the Administrative Agent, which may be
withheld in its reasonable credit judgment, extraordinary losses (or less gains)
included in the determination of net income during such period, net of related
tax effects.
"CONSOLIDATED FIXED CHARGE COVERAGE RATIO" shall mean, for any Test
Period, the ratio of (a) Consolidated EBITDA for such Test Period less (i) the
amount of all Capital Expenditures made by Holdings and its Subsidiaries during
such period and (ii) all cash payments in respect of income taxes made during
such period (net of any cash refund in respect of income taxes actually received
during such period) to (b) Consolidated Fixed Charges for such Test Period.
"CONSOLIDATED FIXED CHARGES" shall mean, for any period, the sum,
without duplication, of (a) Consolidated Interest Expense for such period; (b)
the scheduled principal amount of all amortization payments on all Indebtedness
(including the principal component of all Capital Lease Obligations) of Holdings
and its Subsidiaries for such period (as determined on the first day of the
respective period); (c) all dividend payments on any series of Disqualified
Capital Stock of Holdings, and (d) all accrued dividends on any Preferred Stock
(other than Disqualified Capital Stock) of Holdings, including the Convertible
Preferred Stock (including dividends payable through the issuance of Equity
Interests to the extent Holdings has not irrevocably declared such dividends to
be payable through the issuance of Equity Interests). Consolidated Fixed Charges
for Test Periods ending March 31, 2004, June 30, 2004 and September 30, 2004,
shall be deemed to be, respectively, the Consolidated Fixed Charges as
calculated for the period commencing on January 1, 2004 and ending on (x) March
31, 2004 and multiplied by 4.0, (y) June 30, 2004 and multiplied by 2.0 and (z)
September 30, 2004 and multiplied by 1.333.
"CONSOLIDATED INDEBTEDNESS" shall mean, as at any date of
determination, without duplication, the aggregate amount of all Indebtedness
(but including in any event the then outstanding principal amount of all Loans,
all Capital Lease Obligations and all LC Exposure) of Holdings and its
Consolidated Subsidiaries on a consolidated basis as determined in accordance
with GAAP.
"CONSOLIDATED INTEREST EXPENSE" shall mean, for any period, without
duplication, the total consolidated interest expense of Holdings and its
Consolidated Subsidiaries for such period (calculated without regard to any
limitations on the payment thereof and including commitment fees, letter of
credit fees and net amounts payable under Interest Rate Protection Agreements)
determined in accordance with GAAP plus, without duplication, (a) the portion of
Capital Lease Obligations of Holdings and its Consolidated Subsidiaries
representing the interest factor for such period, (b) imputed interest on
Attributable Indebtedness, (c) cash contributions to any
11
employee stock ownership plan or similar trust to the extent such contributions
are used by such plan or trust to pay interest or fees to any Person (other than
Borrower or a Wholly Owned Subsidiary) in connection with Indebtedness incurred
by such plan or trust, (d) all interest paid or payable with respect to
discontinued operations, (e) all dividend payments on any series of any
Preferred Stock of any Subsidiary of Holdings (other than any Preferred Stock
held by Holding or a Wholly Owned Subsidiary), and (f) all interest on any
Indebtedness of the type described in clause (f) or (k) of the definition of
"Indebtedness" with respect to Holdings or any of its Subsidiaries.
"CONSOLIDATED NET INCOME" shall mean, for any period, the consolidated
net income of Holdings and its Consolidated Subsidiaries determined in
accordance with GAAP, but excluding in any event (a) with the consent of
Collateral Agent and Administrative Agent, which may be withheld in their
collective reasonable credit judgment, after-tax extraordinary gains or
extraordinary losses; (b) after-tax gains or losses realized from (i) the
acquisition of any securities, or the extinguishment or conversion of any
Indebtedness or Equity Interest, of Holdings or any of its Subsidiaries or (ii)
any sales of assets (other than Inventory in the ordinary course of business);
(c) net earnings or loss of any other Person (other than a Subsidiary of
Holdings) in which Holdings or any Consolidated Subsidiary has an ownership
interest, except (in the case of any such net earnings) to the extent such net
earnings shall have actually been received by Holdings or such Consolidated
Subsidiary (subject to the limitation in clause (d) below) in the form of cash
dividends or distributions; (d) the net income of any Consolidated Subsidiary to
the extent that the declaration or payment of dividends or similar distributions
by such Consolidated Subsidiary of its net income is not at the time of
determination permitted without approval under applicable law or regulation or
under such Consolidated Subsidiary's organizational documents or any agreement
(except (i) pursuant to the European Term Loan Documents solely with respect to
restrictions on General Cable Spain's ability to pay or make dividends and (ii)
such other restrictions as are approved in writing and in advance by the
Administrative Agent) or instrument applicable to such Consolidated Subsidiary
or its stockholders; (e) gains or losses from the cumulative effect of any
change in accounting principles; (f) earnings resulting from any reappraisal,
revaluation or write-up of assets; and (g) the income (or loss) of any Person
accrued prior to the date it becomes a Subsidiary of Holdings or any
Consolidated Subsidiary or is merged into or consolidated with Holdings or any
Consolidated Subsidiary or that Person's assets are acquired by Holdings or such
Consolidated Subsidiary.
"CONSOLIDATED SUBSIDIARY" shall mean, as to any Person, all
Subsidiaries of such Person which are consolidated with such Person for
financial reporting purposes in accordance with GAAP.
"CONTESTED COLLATERAL LIEN CONDITIONS" shall mean, with respect to any
Permitted Lien of the type described in paragraphs (a), (b) and (f) of Section
6.02, the following conditions:
(a) any Loan Party shall be contesting such Lien in good
faith;
(b) to the extent such Lien is in an amount in excess of
$250,000, in the aggregate with all other such Liens, the Collateral
Agent shall have established a Reserve (to the extent of such Lien on
Eligible Accounts, Eligible Inventory, Eligible Equipment
12
or Eligible Real Property) with respect thereto or obtained a bond in
an amount sufficient to pay and discharge such Lien and the Collateral
Agent's reasonable estimate of all interest and penalties related
thereto; and
(c) such Lien shall in all respects be subject and
subordinate in priority to the Lien and security interest created and
evidenced by the Security Documents, except if and to the extent that
the law or regulation creating, permitting or authorizing such Lien
provides that such Lien is or must be superior to the Lien and security
interest created and evidenced by the Security Documents.
"CONTINGENT OBLIGATION" shall mean, as to any Person, any obligation,
agreement, understanding or arrangement of such Person guaranteeing or intended
to guarantee any Indebtedness, leases, dividends or other obligations ("PRIMARY
OBLIGATIONS") of any other Person (the "PRIMARY OBLIGOR") in any manner, whether
directly or indirectly, including, without limitation, any obligation of such
Person, whether or not contingent, (a) to purchase any such primary obligation
or any Property constituting direct or indirect security therefor; (b) to
advance or supply funds (i) for the purchase or payment of any such primary
obligation or (ii) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the primary
obligor; (c) to purchase Property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation; (d) with respect
to bankers' acceptances and letters of credit, until a reimbursement obligation
arises; or (e) otherwise to assure or hold harmless the holder of such primary
obligation against loss in respect thereof; provided, however, that the term
"Contingent Obligation" shall not include endorsements of instruments for
deposit or collection in the ordinary course of business or any product
warranties for deposit or collection in the ordinary course of business. The
amount of any Contingent Obligation shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation in respect of which such
Contingent Obligation is made (or, if less, the maximum amount of such primary
obligation for which such Person may be liable, whether severally or jointly,
pursuant to the terms of the instrument evidencing such Contingent Obligation)
or, if not stated or determinable, the maximum reasonably anticipated liability
in respect thereof (assuming such Person is required to perform thereunder) as
determined by such Person in good faith.
"CONTROL" shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ownership of voting securities, by contract or
otherwise, and the terms "CONTROLLING" and "CONTROLLED" shall have meanings
correlative thereto.
"CONVERTIBLE PREFERRED STOCK" shall mean Holdings' 5.75% Series A
Redeemable Convertible Preferred Stock of Holdings, par value $0.01 per share,
liquidation preference $50 per share, issued pursuant to the Convertible
Preferred Stock Documents.
"CONVERTIBLE PREFERRED STOCK DOCUMENTS" shall mean the Certificate of
Designations relating to the Convertible Preferred Stock, the Convertible
Preferred Stock Purchase Agreement and other documents pursuant to which the
Convertible Preferred Stock is issued and all other documents executed and
delivered with respect to the Convertible Preferred Stock, in each case in the
form delivered to the Administrative Agent prior to the Closing Date.
13
"COST" shall mean, as determined by Collateral Agent in good faith,
with respect to Inventory, the lower of (a) landed cost computed on a first-in
first-out basis in accordance with GAAP or (b) market value; provided, that for
purposes of the calculation of the Borrowing Base, (i) the Cost of the Inventory
shall not include: (A) the portion of the cost of Inventory equal to the profit
earned by any Affiliate on the sale thereof to Borrower or the Borrowing Base
Guarantors, (B) write-ups or write-downs in cost with respect to currency
exchange rates, or (C) as determined by the Collateral Agent in the Collateral
Agent's reasonable credit judgment, any costs associated with shipping,
handling, customs duties, or other in-bound freight charges, and (ii)
notwithstanding anything to the contrary contained herein, the cost of the
Inventory shall be computed in the same manner and consistent with the most
recent Inventory Appraisal which has been received and approved by Collateral
Agent in its reasonable discretion.
"CREDIT EXTENSION" shall mean, as the context may require, (a) the
making of a Loan by a Lender or (b) the issuance of any Letter of Credit, or the
amendment, extension or renewal of any existing Letter of Credit, by the Issuing
Bank; provided, that "Credit Extensions" shall include conversions and
continuations of outstanding Revolving Loans.
"DEBT ISSUANCE" shall mean the incurrence by Holdings, Intermediate
Holdings, Borrower or any of their Subsidiaries of any Indebtedness after the
Closing Date (other than as permitted by Section 6.01).
"DEFAULT" shall mean any event, occurrence or condition which is, or
upon notice, lapse of time or both would constitute, an Event of Default.
"DEFAULT ALLOCATION PERCENTAGE" as to any Lender shall mean the
quotient (determined as a percentage) determined as of the date of an Event of
Default, whose numerator equals the principal, interest, fees and other
Obligations owing to such Lender (including all advances made by such Lender
following such Event of Default) plus the amount of such Lender's
marked-to-market exposure under Specified Hedging Agreements as of such date and
whose denominator equals the principal, interest, fees and other Obligations
owing to all Lenders (including all advances made by the Lenders following such
Event of Default) plus the amount of all Lenders' marked-to-market exposure
under Specified Hedging Agreements as of such date.
"DEPOSIT ACCOUNT CONTROL AGREEMENT" means an agreement, in form and
substance satisfactory to Collateral Agent, among Collateral Agent, Borrower or
a Guarantor maintaining a deposit account at any bank, and such bank, which
agreement provides that (a) such bank shall comply with instructions originated
by Collateral Agent directing disposition of the funds in such deposit account
without further consent by Borrower or such Guarantor (as applicable), and (b)
such bank shall agree that it shall have no Lien on, or right of setoff against,
such deposit account or the contents thereof, other than in respect of
commercially reasonable fees and other items expressly consented to by
Collateral Agent, and containing such other terms and conditions as Collateral
Agent may require, including as to any such agreement pertaining to any Blocked
Account, providing that all items received or deposited in such Blocked Account
are the property of Collateral Agent, and that such bank shall wire, or
otherwise transfer, in immediately available funds, on a daily basis to the
Concentration Account, or, in the case of the Concentration Account, to the
Collection Account, all funds received or deposited into such Blocked Account.
14
"DISQUALIFIED CAPITAL STOCK" shall mean any Equity Interest (other than
Convertible Preferred Stock) which, by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable), or upon
the happening of any event, (a) matures (excluding any maturity as the result of
an optional redemption by the issuer thereof) or is mandatorily redeemable,
pursuant to a sinking fund obligation or otherwise, or is redeemable at the
option of the holder thereof, in whole or in part, on or prior to the first
anniversary of the Maturity Date, (b) is convertible into or exchangeable
(unless at the sole option of the issuer thereof) for (i) debt securities or
(ii) any Equity Interests referred to in (a) above, in each case at any time
prior to the first anniversary of the Maturity Date, or (c) contains any
repurchase obligation which may come into effect prior to payment in full of all
Obligations.
"DOCUMENTATION AGENT" shall have the meaning assigned to such term in
the preamble hereto.
"DOCUMENTS" shall mean all "documents," as such term is defined in the
UCC as in effect on the date hereof in the State of New York, in which any
Person now or hereafter has rights.
"DOLLAR EQUIVALENT" shall mean, as to any amount denominated in
Canadian Dollars or any other currency as of any date of determination, the
amount of Dollars that would be required to purchase the amount of Canadian
Dollars or such other currency based upon the spot selling rate at which the
Administrative Agent offers to sell Canadian Dollars or such other currency for
Dollars in the London foreign exchange market at approximately 11:00 a.m. London
time on such date for delivery two (2) Business Days later.
"DOLLARS" or "$" shall mean lawful money of the United States.
"DOMESTIC" shall mean, as to any Person, a Person which is created or
organized under the laws of the United States, any of its states or the District
of Columbia.
"ELIGIBLE ACCOUNTS" shall have the meaning assigned to such term in
Section 2.19(a).
"ELIGIBLE CONSIGNED INVENTORY" shall mean Eligible Inventory of
Borrower or Borrowing Base Guarantor on consignment (A) on a location at which
the aggregate Cost of such Eligible Inventory is no less than $100,000, (B) with
a consignee of Borrower or Borrowing Base Guarantor with respect to which the
aggregate Cost of such consigned Eligible Inventory is not less than $500,000,
and (C) with respect to which Collateral Agent shall have received, in each case
in form and substance satisfactory to Collateral Agent:
(a) a valid consignment agreement or arrangement which is
reasonably satisfactory to Collateral Agent is in place with respect to such
Eligible Inventory;
(b) UCC searches against the consignee in those jurisdictions in
which such Eligible Inventory is subject to consignment and the jurisdiction in
which the consignee is organized or maintains its principal place of business
and such other searches that the Collateral Agent deems necessary or
appropriate;
15
(c) UCC-1 financing statements between the consignee and the
Borrower or Borrowing Base Guarantor, as consignor, in form and substance
satisfactory to Collateral Agent, which are duly assigned to Collateral Agent;
(d) a written notice to any lender to the consignee of the first
priority security interest in such Eligible Inventory of Collateral Agent; and
(e) an agreement in writing, in form and substance satisfactory to
Collateral Agent, from the consignee, pursuant to which such consignee, inter
alia, acknowledges the first priority security interest of Collateral Agent in
such Collateral, agrees to waive any and all claims such consignee may, at any
time, have against such Collateral, whether for processing, storage, breach of
warranty (with respect to prior purchases) or otherwise, and agrees to permit
Collateral Agent access to the premises of such consignee so as to remove such
Collateral from such premises and, in the case of any consignee who at any time
has custody, control or possession of any Collateral, acknowledges that it holds
and will hold possession of the Collateral for the benefit of Collateral Agent
and agrees to follow all instructions of Collateral Agent with respect thereto.
Notwithstanding the foregoing upon reasonable request of Borrower and upon
Collateral Agent receiving evidence satisfactory to it that the applicable
consignee has no secured creditors, Collateral Agent may in its discretion waive
the requirements of clauses (c) and (d) above, but such waiver may be revoked by
the Collateral Agent at any time upon five Business Days written notices to
Borrower; provided, that the amount of the Borrowing Base which may be
determined on the basis of Eligible Consigned Inventory which is eligible
because of Collateral Agent's waiver of the requirements of clauses (c) and (d)
above shall not exceed $10.0 million at any time.
"ELIGIBLE EQUIPMENT" shall mean any Equipment owned by Borrower or
Borrowing Base Guarantor which is acceptable to Collateral Agent in its
reasonable credit judgment for lending purposes and which, without limiting
Collateral Agent's discretion, meets, and so long as it continues to meet, the
following requirements:
(a) is located at one of the business locations in the United States or
Canada of such Persons set forth on Schedule 1.01(e),
(b) is subject to a valid and perfected first priority lien in favor of
Collateral Agent,
(c) is owned by Borrower or Borrowing Base Guarantor free and clear of
all liens and rights of any other Person, except the valid and perfected first
priority Lien in favor of Collateral Agent and Permitted Liens, if any, which
are subordinated to the Lien of Collateral Agent,
(d) does not breach any of the representations or warranties pertaining
to such property set forth in this Agreement or the other Loan Documents,
(e) is covered by insurance reasonably acceptable to Collateral Agent,
(f) is appraised by an independent appraisal or audit firm designated
by Collateral Agent and reasonably acceptable to Borrower, and
16
(g) is not ineligible by virtue of one or more of the criteria set
forth below; provided, however, that such criteria may be revised from time to
time by Collateral Agent in its reasonable credit judgment to address the
results of any audit or appraisal performed by Collateral Agent from time to
time after the date hereof.
An item of Equipment shall be excluded from Eligible Equipment if:
(i) Borrower or Borrowing Base Guarantor does not have good, valid, and
marketable title thereto;
(ii) it is located on real property leased by Borrower or Borrowing
Base Guarantor, unless it is subject to a Landlord Lien Waiver and Access
Agreement executed by the lessor, or other third party, as the case may be, and
unless it is segregated or otherwise separately identifiable from goods of other
Persons, if any, stored on the premises;
(iii) it is damaged, defective or obsolete, or it constitutes
furnishings, parts, fixtures or is affixed to Real Property, unless such
Equipment is affixed to the Mortgaged Real Property listed on Schedule 1.01(e);
(iv) Collateral Agent has not received evidence of the property or
casualty insurance required by this Agreement with respect to such Equipment;
(v) it is subject to a lease with any Person (other than a Borrower or
a Borrowing Base Guarantor, provided, that the Lien on and security interest in
the related lease shall be granted to the Collateral Agent and Collateral Agent
shall have received all control agreements and instruments and all actions shall
be taken as reasonably requested by the Collateral Agent to perfect the
Collateral Agent's security interest in such lease); or
(vi) it is located at an owned location subject to a mortgage in favor
of a lender other than the Collateral Agent (unless a reasonably satisfactory
mortgagee waiver has been delivered to the Collateral Agent) or the removal of
which is subject to restrictions relating to financing arrangement, including
any industrial revenue bond financing.
"ELIGIBLE INVENTORY" shall mean, subject to adjustment as set forth in
Section 2.19(b), items of Inventory of the Borrower and a Borrowing Base
Guarantor.
"ELIGIBLE REAL PROPERTY" shall mean the Real Properties which (a) are
located at (i) 000 Xxxxxxxx Xxxxxx Xxxxxxxxx, Xxxxxxx, Xxxxxxxxxxxx 00000 (Xxxxx
County) owned in fee simple by Borrower, (ii) 0000 Xxxxx Xxxxxxxxxx, XxXxxxx,
Xxxxxxxx 00000 (Perry County) owned in fee simple by Borrower , (iii) 0000
Xx-Xxxx Xxxxx, Xxxxxxxxxxxx, Xxxxxxxx 00000 (Xxxxxxxx County) owned in fee
simple by Intermediate Holdings, (iv) Three Xxxxx Drive, Lincoln, Rhode Island
2865 (Town of Lincoln) owned in fee simple by General Cable LLC, (v) Xxxxxxx 00
Xxxx, Xxxxxxx, Xxxxxxxx 00000 owned in fee simple by Borrower, (vi) X.X. Xxx
000, XX xxxxxxx 00, Xxxxxxxx, Xxxxx 00000 (Xxxxxxxx County), owned in fee simple
by Borrower and (vii) 0 Xxxxxxxxx Xxxxx, Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000,
improvements to which are owned by Intermediate Holdings and which is subject to
that certain Amended and Restated Ground Lease with Option to Purchase, dated
July 26, 1992, between Northern Kentucky University Foundation, Inc., a Kentucky
non-profit corporation and General Cable Technologies (by
17
assignments from Holdings), or (b) are owned by Borrower or a Borrowing Base
Guarantor and designated from time to time by the Collateral Agent as being
Eligible Real Property, provided, that with respect to each such parcel of
Eligible Real Property, each of the improvements thereon is acceptable to the
Collateral Agent in its reasonable credit judgment for lending purposes and each
of which, without limiting such reasonable credit judgment, meets, or continues
to meet, the following requirements: (i) it is subject to a first priority
mortgage or leasehold mortgage and lien in favor of Collateral Agent, (ii) it is
owned by the Borrower and applicable Borrowing Base Guarantor free and clear of
all liens and rights of any other Person, except the mortgage or leasehold
mortgage and lien in favor of Collateral Agent and Permitted Liens which are
subordinate to such mortgage liens of the Collateral Agent, (iii) it does not
breach any of the representations or warranties pertaining to such property set
forth in this Agreement or the other Loan Documents, (iv) it is covered by title
insurance with respect to the Lien of Collateral Agent and casualty and property
insurance reasonably acceptable to the Collateral Agent, (v) it is appraised by
an independent appraisal or audit firm designated by Collateral Agent and
reasonably acceptable to Borrower and (vi) it is the subject of an environmental
report reasonably acceptable to Collateral Agent.
"ENVIRONMENT" shall mean ambient air, surface water and groundwater
(including, without limitation, potable water, navigable water and wetlands),
the land surface or subsurface strata, natural resources, the workplace or as
otherwise defined in any Environmental Law.
"ENVIRONMENTAL CLAIM" shall mean any claim, notice, demand, order,
action, suit, proceeding or other communication in each case alleging liability
for investigation, remediation, removal, cleanup, response, corrective action,
damages to natural resources, personal injury, Property damage, fines, penalties
or other costs resulting from, related to or arising out of (i) the presence,
Release or threatened Release in or into the Environment of Hazardous Material
at any location or (ii) any violation of Environmental Law, and shall include,
without limitation, any claim seeking damages, contribution, indemnification,
cost recovery, compensation or injunctive relief resulting from, related to or
arising out of the presence, Release or threatened Release of Hazardous Material
or alleged injury or threat of injury to health, safety, the Environment.
"ENVIRONMENTAL LAW" shall mean any and all applicable present and
future treaties, laws, statutes, ordinances, regulations, rules, decrees,
orders, judgments, consent orders, consent decrees or other binding
requirements, and the common law, relating to protection of public health or the
Environment, the Release or threatened Release of Hazardous Material, natural
resources or natural resource damages, or occupational safety or health.
"ENVIRONMENTAL PERMIT" shall mean any permit, license, approval,
consent or other authorization required by or from a Governmental Authority
under Environmental Law.
"EQUIPMENT" shall mean, as to any Person, all of such Person's now
owned and hereafter acquired equipment, wherever located, including machinery,
data processing and computer equipment (whether owned or licensed and including
embedded software), vehicles, tools, furniture, fixtures, all attachments,
accessions and property now or hereafter affixed thereto or used in connection
therewith, and substitutions and replacements thereof, wherever located.
18
"EQUITY FINANCING" shall mean the offering of Convertible Preferred
Stock by Holdings on or prior to the Closing Date in an amount not less than
$90.0 million and offering of New Common Stock on or prior to the Closing Date
in an amount of not less than $41.0 million.
"EQUITY FINANCING DOCUMENTS" shall mean the applicable Confidential
Information Memoranda and any other documents pursuant to which the Convertible
Preferred Stock and New Common Stock are issued and all other documents,
instruments or agreements executed and delivered with respect to the Convertible
Preferred Stock or the New Common Stock.
"EQUITY INTEREST" shall mean, with respect to any Person, any and all
shares, interests, participations or other equivalents, including membership
interests (however designated, whether voting or non-voting), of equity of such
Person, including, if such Person is a partnership, partnership interests
(whether general or limited) and any other interest or participation that
confers on a Person the right to receive a share of the profits and losses of,
or distributions of assets of, such partnership, whether outstanding on the date
hereof or issued after the Closing Date, but excluding debt securities
convertible or exchangeable into such equity.
"EQUITY ISSUANCE" shall mean, without duplication, any issuance or sale
after the Closing Date of (a) any Equity Interests (including any Equity
Interests issued upon exercise of any warrant or option) or any warrants or
options to purchase Equity Interests or (b) any other security or instrument
representing an Equity Interest (or the right to obtain any Equity Interest) in
the issuing or selling Person.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as the same may be amended from time to time.
"ERISA AFFILIATE" shall mean any trade or business (whether or not
incorporated) that, together with Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code, or solely for purposes of Section 302
of ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.
"ERISA EVENT" shall mean (a) any "reportable event," as such term is
defined in Section 4043(c) of ERISA or the regulations issued thereunder, with
respect to a Plan (other than an event for which the 30-day notice period is
waived by regulation); (b) the existence with respect to any Plan of an
"accumulated funding deficiency" (as defined in Section 412 of the Code or
Section 302 of ERISA), whether or not waived, the failure to make by its due
date a required installment under Section 412(m) of the Code with respect to any
Plan or the failure to make any required contribution to a Multiemployer Plan;
(c) the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA
of an application for a waiver of the minimum funding standard with respect to
any Plan; (d) the incurrence by any Company or any of its ERISA Affiliates of
any liability under Title IV of ERISA with respect to the termination of any
Plan; (e) the receipt by any Company or any of its ERISA Affiliates from the
PBGC or a plan administrator of any notice relating to the intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan, or
the occurrence of any event or condition which could reasonably be expected to
constitute grounds under ERISA for the termination of, or the appointment of a
trustee to administer, any Plan; (f) the incurrence by any Company or any of its
ERISA Affiliates of any liability with respect to the withdrawal from any Plan
or Multiemployer
19
Plan; (g) the receipt by any Company or its ERISA Affiliates of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA; (h) the making of any amendment to any
Plan which could result in the imposition of a lien or the posting of a bond or
other security; and (i) the occurrence of a nonexempt prohibited transaction
(within the meaning of Section 4975 of the Code or Section 406 of ERISA) which
could result in liability to any Company.
"EURO", "EURO" "EUROS" or "EUR" shall mean the single currency of
Participating Member States.
"EURODOLLAR REVOLVING BORROWING" shall mean a Borrowing comprised of
Eurodollar Revolving Loans.
"EURODOLLAR REVOLVING LOAN" shall mean any Revolving Loan bearing
interest at a rate determined by reference to the Adjusted LIBOR Rate in
accordance with the provisions of Article II.
"EUROPEAN TERM LOAN" shall mean the term loan and/or revolving
financing to be provided to General Cable Spain by Banco Bilbao Vizcaya
Argentaria, S.A. in the original principal amount of not less than the Dollar
Equivalent of EUR 30 million.
"EUROPEAN TERM LOAN DOCUMENTS" shall mean the agreement providing for
the European Term Loan and all other related documents, instruments and
agreements (and any amendments or other modification thereto), each in form and
substance as approved by the Administrative Agent, in its reasonable credit
judgment, in advance and in writing, which documentation shall not include any
restriction other than those approved by the Administrative Agent on the ability
of General Cable Spain to make payments on intercompany loans or other
obligations of General Cable Spain to any Loan Party.
"EVENT OF DEFAULT" shall have the meaning assigned to such term in
Article VIII.
"EXCESS AVAILABILITY" shall mean (a) the lesser of (i) the Revolving
Commitments of all of the Lenders and (ii) the Borrowing Base on the date of
determination less (b) all outstanding Loans and LC Exposure less (c) in
Collateral Agent's reasonable discretion, the aggregate amount of all the
outstanding and unpaid trade payables and other obligations of Borrower and/or
its Borrowing Base Guarantors which are not paid within 60 days past the due
date according to their original terms of sale, in each case as of such date of
determination less (d) in Collateral Agent's reasonable discretion, the amount
of checks issued by Borrower and/or its Borrowing Base Guarantors to pay trade
payables and other obligations which are not paid within 60 days past the due
date according to their original terms of sale, in each case as of such date of
determination, but which either have not yet been sent or are subject to other
arrangements which are expected to delay the prompt presentation of such checks
for payment.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended.
"EXCLUDED TAXES" shall mean, with respect to the Administrative Agent,
any Lender, the Issuing Bank or any other recipient of any payment to be made by
or on account of any
20
obligation of Borrower hereunder, (a) income or franchise taxes imposed on (or
measured by) its net income by the United States, or by the jurisdiction under
the laws of which such recipient is organized or in which its principal office
is located or, in the case of any Lender, in which its applicable lending office
is located, and (b) in the case of a Foreign Lender (other than an assignee
pursuant to a request by Borrower under Section 2.16), any withholding tax that
is imposed on amounts payable to such Foreign Lender at the time such Foreign
Lender becomes a party to this Agreement (or designates a new lending office) or
is attributable to such Foreign Lender's failure to comply with Section 2.15(e),
except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new lending office (or assignment), to
receive additional amounts from Borrower with respect to such withholding tax
pursuant to Section 2.15(a) (it being understood and agreed, for the avoidance
of doubt, that any withholding tax imposed on a Foreign Lender as a result of a
Change in Law or regulation or interpretation thereof occurring after the time
such Foreign Lender became a party to this Agreement shall not be an Excluded
Tax).
"FAIR MARKET VALUE" shall mean, with respect any asset, the price
(after taking into account any liabilities relating to such assets) which could
be negotiated in an arm's length free market transaction, for cash, between a
willing seller and a willing and able buyer, neither of which is under any
compulsion to complete the transaction.
"FALV AMORTIZATION FACTOR" shall mean 1 minus a fraction, the numerator
of which is the number of calendar quarters elapsed as of any date of
determination since December 31, 2003 (but in no event more than 28) and the
denominator of which is 28.
"FEDERAL FUNDS EFFECTIVE RATE" shall mean, for any day, 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 on the
next succeeding Business Day by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day that is a Business Day, the average of
the quotations for the day for such transactions received by the Administrative
Agent from three federal funds brokers of recognized standing selected by it.
"FEE LETTER" shall mean that certain letter, dated as of the date
hereof, among Borrower, Xxxxxxx and UBS with respect to certain Fees to be paid
from time to time by Borrower to Xxxxxxx and UBS.
"FEES" shall mean the Commitment Fees, the Administrative Agent Fees,
the Collateral Agent Fees, the LC Participation Fees, the Fronting Fees and any
and all fees payable to pursuant to this Agreement or any of the other Loan
Documents.
"FINANCIAL OFFICER" of any Person shall mean the Chief Financial
Officer, principal accounting officer, Treasurer or Controller of such Person.
"FIRREA" shall mean the Federal Institutions Reform, Recovery and
Enforcement Act of 1989.
"FIXED ASSET LOAN VALUE" shall mean an amount equal to the sum of (a)
the advance rate of 80% of the appraised net orderly liquidation value of the
Eligible Equipment of the Person owning such Eligible Equipment plus (b) the
advance rate of 60% of the appraised fair
21
market value of the Eligible Real Property of the Person owning such Eligible
Real Property. The appraised net orderly liquidation value of Eligible Equipment
and the appraised fair market value of Eligible Real Property are set forth on
Schedule 1.01(d), as Schedule 1.01(d) may be amended from time to time as
provided herein. The Fixed Asset Loan Value of Borrower and each of the
Borrowing Base Guarantors as of the Closing Date is $44.0 million. If any
Eligible Equipment or Eligible Real Property listed on Schedule 1.01(d) is sold,
liquidated or otherwise ceases to be Eligible Equipment or Eligible Real
Property, the calculation of the Fixed Asset Loan Value of the Person who owns
such Eligible Equipment or Eligible Real Property shall be reduced by the
appraised net orderly liquidation value of such Eligible Equipment or the
appraised fair market value of such Eligible Real Property and such Eligible
Equipment and Eligible Real Property shall be deleted from Schedule 1.01(d) and
Collateral Agent shall correspondingly amend Schedule 1.01(d) without any
further action of any party hereto. At the request of Borrower, the Collateral
Agent and may consider adding Eligible Equipment and/or Eligible Real Property
to Schedule 1.01(d), and if the Collateral Agent determine that the requested
Eligible Equipment and Eligible Real Property is to be added to Schedule
1.01(d), then, upon completion of appraisals satisfactory to Collateral Agent
conducted at Borrower's cost and expense, the appraised net orderly net orderly
liquidation value of any additional Eligible Equipment or the appraised fair
market value of any additional Eligible Real Property shall be included in the
calculation of the Fixed Asset Loan Value of the Person who owns such Eligible
Equipment or Eligible Real Property and such Eligible Equipment and Eligible
Real Property shall be added to Schedule 1.01(d) and Collateral Agent shall
correspondingly amend Schedule 1.01(d) without any further action of any party
hereto.
"FOREIGN" shall mean, as to any Person, a Person which is not created
or organized under the laws of the United States, any of its States or the
District of Columbia, or Canada, or any Province thereof.
"FOREIGN CREDIT LINES" shall mean any and all committed or uncommitted
credit lines and invoice, commercial paper or draft discounting and other
similar credit facilities of Foreign Subsidiaries from banks or other financial
institutions which are currently or may in the future become available for such
Foreign Subsidiaries, other than any such lines or facilities the utilization of
which require that the relevant Foreign Subsidiaries satisfy conditions which
cannot currently be met; the amount of any Foreign Credit Line shall refer to
the maximum amount that can currently be outstanding to the respective Foreign
Subsidiaries under such lines or facilities, including, without limitation, the
face amount of letters of credit and contingent obligations with respect to
guaranties and similar obligations issued in relation or pursuant thereto.
"FOREIGN GUARANTIES" shall mean the Canadian Guaranty and the Mexican
Guaranty.
"FOREIGN GUARANTORS" shall mean General Cable de Mexico del Norte SA de
CV, a Mexican corporation and General Cable de Latinoamerica, SA de CV, a
Mexican corporation.
"FOREIGN LENDER" shall mean any Lender that is not, for United States
federal income tax purposes, (i) a citizen or resident of the United States,
(ii) a corporation or entity treated as a corporation created or organized in or
under the laws of the United States, or any political subdivision thereof, (iii)
an estate the income of which is subject to U.S. federal income taxation
regardless of its source or (iv) a trust if a court within the United States is
able to exercise
22
primary supervision over the administration of such trust and one or more United
States Persons have the authority to control all substantial decisions of such
trust.
"FOREIGN PLAN" shall mean any employee benefit plan, program, policy,
arrangement or agreement maintained or contributed to by any Foreign Company
with respect to employees employed outside the United States.
"FOREIGN PLEDGE AGREEMENTS" shall mean those certain agreements, dated
as of the date hereof, (a) by Borrower pledging 65% of Equity Interests in
General Cable Property Holdings Limited, governed by Jersey law, (b) by
Intermediate Holdings pledging 65% of Equity Interests in General Cable
Investments, SGPS SA, governed by Madeira law, (c) by Intermediate Holdings
pledging 65% of Equity Interests in General Cable Holdings Netherlands C.V.,
governed by the law of the Netherlands, (d) by Intermediate Holdings pledging
65% of Equity Interests in General Cable Holdings (UK) Limited, governed by
English law, (e) by Borrower pledging 65% of Equity Interests in General Cable
Services Limited, governed by English law, (f) by Intermediate Holdings and
Borrower pledging 100% of Equity Interests in General Cable de Mexico del Norte
SA de CV, governed by Mexican law, (g) by Borrower and General Cable
Technologies pledging 100% of Equity Interests in General Cable Holdings de
Mexico SA de CV, governed by Mexican law, and (h) by Intermediate Holdings
pledging 65% of Equity Interests in General Cable Holdings (Spain) SRL, governed
by Spanish law, in each case in favor of the Collateral Agent.
"FRONTING FEES" shall have the meaning assigned to such term in Section
2.05(c).
"GAAP" shall mean generally accepted accounting principles in the
United States applied on a consistent basis.
"GCC SPAIN INTERCOMPANY DEBT" shall mean the GCC Spain Refinancing
Intercompany Debt, the other existing unsecured Indebtedness owing by General
Cable Spain to Borrower in the principal amount of the Dollar Equivalent of
$35.0 million and such other unsecured Indebtedness owing by General Cable Spain
to Borrower by reason of intercompany advances made by Borrower to General Cable
Spain after the Closing Date to the extent permitted by Section 6.01(i) and
Section 6.04.
"GCC SPAIN REFINANCING INTERCOMPANY DEBT" shall mean the unsecured
Indebtedness owing by General Cable Spain to Borrower arising due to repayment
in full of General Cable Spain's obligations under the applicable agreements
listed on Schedule 1.01(b) with the proceeds of an intercompany advance made by
Borrower to General Cable Spain on or before the Closing Date in anticipation of
Refinancing.
"GENERAL CABLE CANADA" shall mean General Cable Company, a Nova Scotia
corporation.
"GENERAL CABLE LLC" shall mean General Cable Industries, LLC, a
Delaware limited liability company.
"GENERAL CABLE RESOURCES" shall means General Cable Resources
Corporation, a Delaware corporation.
23
"GENERAL CABLE SPAIN" shall mean Grupo General Cable Sistemas, S.A., a
Spanish corporation.
"GENERAL CABLE SPE" shall mean General Cable Capital Funding, Inc., a
Delaware corporation.
"GENERAL CABLE TECHNOLOGIES" shall mean General Cable Technologies
Corp., a Delaware corporation.
"GENERAL CABLE TEXAS" shall mean General Cable Texas Operations L.P., a
Delaware limited partnership.
"GOVERNMENTAL AUTHORITY" shall mean any federal, state, local or
foreign court, central bank or governmental agency, authority, instrumentality
or regulatory body.
"GOVERNMENTAL REAL PROPERTY DISCLOSURE REQUIREMENTS" shall mean any
Requirement of Law of any Governmental Authority requiring notification of the
buyer, lessee, mortgagee, assignee or other transferee of any Real Property,
facility, establishment or business, or notification, registration or filing to
or with any Governmental Authority, in connection with the sale, lease,
mortgage, assignment or other transfer (including, without limitation, any
transfer of control) of any Real Property, facility, establishment or business,
of the actual or threatened presence or Release in or into the Environment, or
the use, disposal or handling of Hazardous Material on, at, under or near the
Real Property, facility, establishment or business to be sold, leased,
mortgaged, assigned or transferred.
"GUARANTEED OBLIGATIONS" shall have the meaning assigned to such term
in Section 7.01.
"GUARANTEES" shall mean the guarantees issued pursuant to Article VII
and Foreign Guaranties.
"GUARANTOR" shall mean each Borrowing Base Guarantor, each Domestic
Subsidiary listed on Schedule 1.01(c), General Cable Canada Ltd., an Ontario
corporation, each Foreign Guarantor and each other Subsidiary that is or becomes
a party to this Agreement pursuant to Section 5.11.
"HAZARDOUS MATERIALS" shall mean the following: hazardous substances;
hazardous wastes; polychlorinated biphenyls ("PCBs") or any substance or
compound containing PCBs; asbestos or any asbestos-containing materials in any
form or condition; radon or any other radioactive materials including any
source, special nuclear or by-product material; petroleum, crude oil or any
fraction thereof; and any other pollutant or contaminant or hazardous, toxic or
dangerous chemicals, wastes, materials, compounds, constituents or substances,
as all such terms are used in their broadest sense and defined by or under any
Environmental Laws.
"HEDGING AGREEMENT" shall mean any Interest Rate Protection Agreement,
foreign currency exchange agreement, commodity price protection agreement or
other interest or currency exchange rate or commodity price hedging arrangement.
24
"HEDGING RESERVE" shall mean a Reserve determined by the Collateral
Agent in its reasonable credit judgment and giving effect to the aggregate
amount owing to Borrower or the applicable Borrowing Base Guarantor by a
counterparty to a Specified Hedging Agreement, less the amount Borrower or the
applicable Borrowing Base Guarantor, as applicable, owes such counterparty
thereunder, less the aggregate amount of Property pledged to cash collateralize
such obligation (other than the Collateral granted under the Loan Documents), in
each case based on a xxxx-to-market analysis and with due regard to recent
market volatility as of the last Business Day of the month (or if not available,
the nearest prior Business Day for which such evaluation is available).
"HOLDING COMPANIES" shall mean Holdings, Intermediate Holdings,
Marathon Manufacturing Holdings, Inc., a Delaware corporation, General Cable
Holdings, Inc., a Delaware corporation, General Cable Management, LLC, a
Delaware limited liability company and General Cable Overseas Holdings, Inc., a
Delaware corporation, General Cable Investments, SGPS SA, a Madeira corporation,
General Cable Holdings de Mexico SA de CV, a Mexican corporation, General Cable
Holdings New Zealand, a New Zealand corporation, General Cable Holdings (Spain)
SRL, a Spanish corporation, General Cable Holdings Netherlands C.V., a Dutch
corporation, and General Cable Holdings (UK) Limited, an English corporation.
"HOLDINGS" shall mean General Cable Corporation, a Delaware
corporation.
"INACTIVE SUBSIDIARIES" shall mean Genca Corporation, a Delaware
corporation, Diversified Contractors, Inc., a Delaware corporation, MLTC
Company, a Delaware corporation, Marathon Steel Company, an Arizona corporation,
General Cable Canada Ltd., an Ontario corporation, General Cable Property
Holdings Limited, a Jersey corporation, General Cable Service Limited, organized
under the laws of England and Wales and General Cable Export Sales Corporation,
a Barbados corporation.
"INCORPORATED BORROWING BASE" shall mean at any time, for each
Borrowing Base Guarantor, subject to adjustment as provided in Section 2.19, an
amount equal to the lesser of :
(a) the sum of, without duplication:
(i) the book value of Eligible Accounts of such Borrowing
Base Guarantor multiplied by the advance rate of 85%, plus
(ii) the lesser of (A) the advance rate of 60% of the Cost
of Eligible Inventory of such Borrowing Base Guarantor, or (B) the advance rate
of 85% of the Net Recovery Cost Percentage multiplied by the Cost of Eligible
Inventory of such Borrowing Base Guarantor, plus
(iii) at Borrower's request, if and to the extent
Borrower's Fixed Asset Loan Value is less than $40.0 million, the Fixed Asset
Loan Value of such Borrowing Base Guarantor multiplied by FALV Amortization
Factor; provided, that the aggregate of the Fixed Asset Loan Values of Borrower
and the Borrowing Base Guarantors shall in no event exceed $40.0 million, minus
(iv) in the case of the Incorporated Borrowing Base of
General Cable Canada, the Canadian Priority Payment Reserve, or
25
(b) with respect to all Borrowing Base Guarantors except for
Holdings, Intermediate Holdings and General Cable Canada, the applicable
Borrowing Base Guarantor Intercompany Loan Account.
"INDEBTEDNESS" of any Person shall mean, without duplication, (a) all
obligations of such Person for borrowed money or advances; (b) all obligations
of such Person evidenced by bonds, debentures, notes or similar instruments; (c)
all obligations of such Person upon which interest charges are customarily paid
or accrued; (d) all obligations of such Person under conditional sale or other
title retention agreements relating to Property purchased by such Person; (e)
all obligations of such Person issued or assumed as the deferred purchase price
of Property or services (excluding trade accounts payable and accrued
obligations incurred in the ordinary course of business on normal trade terms
and not overdue by more than 90 days); (f) all Indebtedness of others secured by
(or for which the holder of such Indebtedness has an existing right, contingent
or otherwise, to be secured by) any Lien on Property owned or acquired by such
Person, whether or not the obligations secured thereby have been assumed; (g)
all Capital Lease Obligations, Purchase Money Obligations and synthetic lease
obligations of such Person; (h) all obligations of such Person in respect of
Hedging Agreements to the extent required to be reflected on a balance sheet of
such Person; (i) all Attributable Indebtedness of such Person; (j) all
obligations for the reimbursement of any obligor in respect of letters of
credit, letters of guaranty, bankers' acceptances and similar credit
transactions; and (k) all Contingent Obligations of such Person in respect of
Indebtedness or obligations of others of the kinds referred to in clauses (a)
through (j) above. The Indebtedness of any Person shall include the Indebtedness
of any other entity (including any partnership in which such Person is a general
partner) to the extent such Person is liable therefor as a result of such
Person's ownership interest in or other relationship with such entity, except to
the extent that terms of such Indebtedness provide that such Person is not
liable therefor. For the avoidance of doubt, the reclassification of the
Convertible Preferred Stock pursuant to SFAS 150 or otherwise in accordance with
GAAP shall not be deemed to be Indebtedness hereunder.
"INDEMNIFIED TAXES" shall mean Taxes other than Excluded Taxes.
"INDEMNITEE" shall have the meaning assigned to such term in Section
11.03(b).
"INFORMATION" shall have the meaning assigned to such term in Section
11.12.
"INSTRUMENTS" shall mean all "instruments," as such term is defined in
the UCC as in effect on the date hereof in the State of New York, in which any
Person now or hereafter has rights.
"INTELLECTUAL PROPERTY" shall have the meaning assigned to such term in
Section 3.05(c).
"INTERCOMPANY AGREEMENTS" shall mean the agreements listed on Schedule
1.01(f), each as in effect on the Closing Date.
"INTEREST ELECTION REQUEST" shall mean a request by Borrower to convert
or continue a Revolving Borrowing in accordance with Section 2.08(b),
substantially in the form of Exhibit D.
26
"INTEREST PAYMENT DATE" shall mean (a) with respect to any ABR
Revolving Loan, the last day of each month during the period that such Revolving
Loan is outstanding and the Maturity Date of such Revolving Loan, (b) with
respect to any Eurodollar Revolving Loan, the last day of the Interest Period
applicable to the Borrowing of which such Revolving Loan is a part and, in the
case of a Eurodollar Revolving Loan with an Interest Period of more than three
months' duration, each day prior to the last day of such Interest Period that
occurs at intervals of three months' duration after the first day of such
Interest Period, and (c) with respect to any Swingline Loan, the day that such
Swingline Loan is required to be repaid.
"INTEREST PERIOD" shall mean, with respect to any Eurodollar Revolving
Borrowing, the period commencing on the date of such Revolving Borrowing and
ending on the numerically corresponding day in the calendar month that is one,
two, three or six months thereafter, as Borrower may elect; provided, that (a)
if any Interest Period would end on a day other than a Business Day, such
Interest Period shall be extended to the next succeeding Business Day unless
such next succeeding Business Day would fall in the next calendar month, in
which case such Interest Period shall end on the next preceding Business Day and
(b) any Interest Period that commences on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
last calendar month of such Interest Period) shall end on the last Business Day
of the last calendar month of such Interest Period. For purposes hereof, the
date of a Revolving Borrowing initially shall be the date on which such
Revolving Borrowing is made and thereafter shall be the effective date of the
most recent conversion or continuation of such Revolving Borrowing; provided,
however, that an Interest Period shall be limited to one month to the extent
required under Section 2.03(e).
"INTEREST RATE PROTECTION AGREEMENT" shall mean any interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement or
similar agreement or arrangement designed to protect Holdings, Borrower or any
of their Subsidiaries against fluctuations in interest rates and not entered
into for speculation.
"INTERMEDIATE HOLDINGS" shall mean GK Technologies, Incorporated, a New
Jersey corporation.
"INVENTORY" shall mean all "inventory," as such term is defined in the
UCC as in effect on the date hereof in the State of New York, wherever located,
in which any Person now or hereafter has rights.
"INVENTORY APPRAISAL" shall mean (a) on the Closing Date, the report
prepared by DoveBid Valuation Services, Inc. dated October 27, 2003 and (b)
thereafter, the most recent inventory appraisal conducted by an independent
appraisal firm designated by Collateral Agent and reasonably acceptable to
Borrower and delivered pursuant to Section 9.02 hereof.
"INVESTMENTS" shall have the meaning assigned to such term in Section
6.04.
"ISSUING BANK" shall mean, as the context may require, (a) UBS AG,
Stamford Branch, with respect to Letters of Credit issued by it; (b) any other
Lender that may become an Issuing Bank pursuant to Section 2.18(i), with respect
to Letters of Credit issued by such Lender; or (c) collectively, all of the
foregoing.
27
"ITA" shall mean the Income Tax Act (Canada) as the same may, from time
to time, be in effect.
"JOINDER AGREEMENT" shall mean that certain joinder agreement
substantially in the form of Exhibit E.
"JOINT VENTURE" means a Person in which one or more Persons other than
any Company own 50% or more of Equity Interests.
"JUDGMENT CURRENCY" shall have the meaning assigned to such term in
Section 11.16(a).
"LANDLORD LIEN WAIVER AND ACCESS AGREEMENT" shall mean the Landlord
Lien Waiver and Access Agreement, substantially in the form of Exhibit F.
"LC COMMITMENT" shall mean the commitment of the Issuing Bank to issue
Letters of Credit pursuant to Section 2.18.
"LC DISBURSEMENT" shall mean a payment or disbursement made by the
Issuing Bank pursuant to a Letter of Credit.
"LC EXPOSURE" shall mean at any time the sum of (a) the aggregate
undrawn amount of all outstanding Letters of Credit at such time plus (b) the
aggregate principal amount of all LC Disbursements that have not yet been
reimbursed at such time. The LC Exposure of any Revolving Lender at any time
shall mean its Pro Rata Percentage of the aggregate LC Exposure at such time.
"LC PARTICIPATION FEE" shall have the meaning assigned to such term in
Section 2.05(c).
"LC REQUEST" shall mean a request by Borrower in accordance with the
terms of Section 2.18(b) and substantially in the form of Exhibit A-3, or such
other form as shall be approved by the Administrative Agent.
"LEASES" shall mean any and all leases, subleases, tenancies, options,
concession agreements, rental agreements, occupancy agreements, franchise
agreements, access agreements and any other agreements (including all
amendments, extensions, replacements, renewals, modifications and/or guarantees
thereof), whether or not of record and whether now in existence or hereafter
entered into, affecting the use or occupancy of all or any portion of any Real
Property.
"LENDER ADDENDUM" shall mean with respect to any Lender on the Closing
Date, a lender addendum in the form of Exhibit A-4<184> to be executed and
delivered by such Lender on the Closing Date as provided in Section 11.14.
"LENDER AFFILIATE" shall mean with respect to any Lender that is a fund
that invests in bank loans, any other fund that invests in commercial loans and
is managed or advised by the same investment advisor as such Lender or by an
Affiliate of such advisor.
28
"LENDERS" shall mean (a) the financial institutions that have become a
party hereto pursuant to a Lender Addendum (other than any such financial
institution that has ceased to be a party hereto pursuant to an Assignment and
Acceptance) and (b) any financial institution that has become a party hereto
pursuant to an Assignment and Acceptance. Unless the context clearly indicates
otherwise, the term "Lenders" shall include the Swingline Lender.
"LETTER OF CREDIT" shall mean any (i) Standby Letter of Credit and (ii)
Commercial Letter of Credit, in each case, issued or to be issued by an Issuing
Bank for the account of Borrower pursuant to Section 2.18.
"LETTER OF CREDIT EXPIRATION DATE" shall mean the date which is ten
Business Days prior to the Maturity Date.
"LIBOR RATE" shall mean, with respect to any Eurodollar Revolving
Borrowing for any Interest Period therefor, the rate per annum determined by the
Administrative Agent to be the arithmetic mean (rounded to the nearest 1/100 of
1%) of the offered rates for deposits in Dollars with a term comparable to such
Interest Period that appears on the Telerate British Bankers Assoc. Interest
Settlement Rates Page (as defined below) at approximately 11:00 a.m., London,
England time, on the second full Business Day preceding the first day of such
Interest Period; provided, however, that (i) if no comparable term for an
Interest Period is available, the LIBOR Rate shall be determined using the
weighted average of the offered rates for the two terms most nearly
corresponding to such Interest Period and (ii) if there shall at any time no
longer exist a Telerate British Bankers Assoc. Interest Settlement Rates Page,
"LIBOR Rate" shall mean, with respect to each day during each Interest Period
pertaining to Eurodollar Revolving Borrowings comprising part of the same
Borrowing, the rate per annum equal to the rate at which the Administrative
Agent is offered deposits in Dollars at approximately 11:00 a.m., London,
England time, two Business Days prior to the first day of such Interest Period
in the London interbank market for delivery on the first day of such Interest
Period for the number of days comprised therein and in an amount comparable to
its portion of the amount of such Eurodollar Revolving Borrowing to be
outstanding during such Interest Period. "TELERATE BRITISH BANKERS ASSOC.
INTEREST SETTLEMENT RATES PAGE" shall mean the display designated as Page 3750
on the Telerate System Incorporated Service (or such other page as may replace
such page on such service for the purpose of displaying the rates at which
Dollar deposits are offered by leading banks in the London interbank deposit
market).
"LIEN" shall mean, with respect to any Property, (a) any mortgage, deed
of trust, lien, pledge, encumbrance, claim, charge, assignment, hypothecation,
security interest or encumbrance of any kind, any other type of preferential
arrangement in respect of such Property or any filing of any financing statement
under the UCC or any other similar notice of Lien under any similar notice or
recording statute of any Governmental Authority, including any easement,
right-of-way or other encumbrance on title to Real Property, in each of the
foregoing cases whether voluntary or imposed by law, and any agreement to give
any of the foregoing; (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such Property; and (c) in the case of securities, any
purchase option, call or similar right of a third party with respect to such
securities.
29
"LINE RESERVE" shall mean a reserve established against the Commitments
to reflect the amount of the Commitments which are not available to the Borrower
due to the establishment of a Reinvestment Reserve.
"LOAN DOCUMENTS" shall mean this Agreement, any Borrowing Base
Certificate, the Letters of Credit, the Notes (if any), the Security Documents,
the Fee Letter and each Specified Hedging Agreement entered into with any
counterparty that was a Lender or an Affiliate of a Lender at the time such
Hedging Agreement was entered into.
"LOAN PARTIES" shall mean Borrower and Guarantors.
"LOANS" shall mean advances made to or at the instructions of Borrower
pursuant to Article II hereof and may constitute a Revolving Loan or a Swingline
Loan.
"MARGIN STOCK" shall have the meaning assigned to such term in
Regulation U.
"MATERIAL ADVERSE EFFECT" shall mean (a) a material adverse effect on
the business, Property, results of operations, prospects or condition, financial
or otherwise, or material agreements of Borrower and the Subsidiaries, taken as
a whole; (b) material impairment of the ability of any Borrower, Borrowing Base
Guarantor or any other Guarantor that is not a Holding Company or an Inactive
Subsidiary to fully and timely perform any of their obligations under any Loan
Document, (c) material impairment of the ability of any Guarantor other than
Guarantors described in clause (b) above to fully and timely perform any of
their obligations under any Security Document; (d) material impairment of the
ability of Guarantors other than Guarantors described in clause (b) above, when
such Guarantors are taken as a whole, to fully and timely perform any of their
obligations under any Guaranties; (e) material impairment of the rights of or
benefits or remedies available to the Lenders or the Collateral Agent under any
Loan Document; or (f) a material adverse effect on the Collateral or the Liens
in favor of the Collateral Agent (for its benefit and for the benefit of the
other Secured Parties) on the Collateral or the priority of such Liens.
"MATERIAL INDEBTEDNESS" shall mean Indebtedness (other than the Loans
and Letters of Credit), or obligations in respect of one or more Hedging
Agreements, of any Loan Party evidencing an aggregate outstanding principal
amount exceeding $3.0 million. For purposes of determining Material
Indebtedness, the "principal amount" of the obligations of such Loan Party in
respect of any Hedging Agreement at any time shall be the maximum aggregate
amount (giving effect to any netting agreements) that such Loan Party would be
required to pay if such Hedging Agreement were terminated at such time.
"MATURITY DATE" shall mean November 24, 2008.
"MAXIMUM RATE" shall have the meaning assigned to such term in Section
11.13.
"XXXXXXX" shall have the meaning assigned to such term in the preamble
hereto.
"MEXICAN GUARANTY" shall mean that certain Guarantee dated as of the
date hereof addressed to the Collateral Agent for the benefit of the Secured
Parties by General Cable de Mexico del Norte SA de CV, a Mexican corporation and
General Cable de Latinoamerica, SA de
30
CV, a Mexican corporation, which is governed by Mexican law, as the same may
from time to time be modified, amended, extended or reaffirmed in accordance
with the terms hereof and with the consent of Collateral Agent.
"MORTGAGE" shall mean an agreement, including, but not limited to, a
mortgage, deed of trust or any other document, creating and evidencing a Lien on
a Mortgaged Real Property, which shall be in substantially in the form of
Exhibit G, with such schedules and including such provisions as shall be
necessary to conform such document to applicable local or foreign law or as
shall be customary under applicable local or foreign law.
"MORTGAGED REAL PROPERTY" shall mean (a) each Real Property identified
on Schedule 1.01(a) hereto and (b) each Real Property, if any, which shall be
subject to a Mortgage delivered after the Closing Date pursuant to Section
5.11(d).
"MULTIEMPLOYER PLAN" shall mean a multiemployer plan within the meaning
of Section 4001(a)(3) or Section 3(37) of ERISA (a) to which any Company or any
ERISA Affiliate is then making or accruing an obligation to make contributions;
(b) to which any Company or any ERISA Affiliate has within the preceding five
plan years made contributions; or (c) with respect to which any Company could
incur liability.
"NET CASH PROCEEDS" shall mean:
(a) with respect to any Asset Sale, the cash proceeds
received by any Loan Party (including cash proceeds subsequently
received (as and when received by any Loan Party) in respect of noncash
consideration initially received) net of (i) selling expenses
(including reasonable brokers' fees or commissions, legal, accounting
and other professional and transactional fees, transfer and similar
taxes and Borrower's good faith estimate of income taxes paid or
payable in connection with such sale); (ii) amounts provided as a
reserve, in accordance with GAAP, against any liabilities under any
indemnification obligations associated with such Asset Sale (provided,
that, to the extent and at the time any such amounts are released from
such reserve, such amounts shall constitute Net Cash Proceeds); (iii)
Borrower's good faith estimate of payments required to be made with
respect to unassumed liabilities relating to the assets sold within 90
days of such Asset Sale (provided, that, to the extent such cash
proceeds are not used to make payments in respect of such unassumed
liabilities within 90 days of such Asset Sale, such cash proceeds shall
constitute Net Cash Proceeds); and (iv) the principal amount, premium
or penalty, if any, interest and other amounts on any Indebtedness for
borrowed money which is secured by a senior Lien on the asset sold in
such Asset Sale and which is repaid with such proceeds (other than any
such Indebtedness assumed by the purchaser of such asset);
(b) with respect to any Debt Issuance, the cash proceeds
thereof, net of customary fees (including discounts to underwriters),
commissions, costs and other expenses incurred in connection therewith;
and
(c) with respect to any Casualty Event, the cash
insurance proceeds, condemnation awards and other compensation received
in respect thereof, net of all
31
reasonable costs and expenses incurred in connection with the
collection of such proceeds, awards or other compensation in respect of
such Casualty Event and net of amounts which are secured by any senior
Lien (to the extent such Liens constitute Permitted Lien hereunder) on
the applicable Property and which is paid with such proceeds.
"NEW COMMON STOCK" shall mean up to 5,807,500 shares of common stock of
Holdings, par value $0.01 per share (of which 5,050,000 are issued on the
Closing Date) issued pursuant to the applicable Confidential Information
Memorandum.
"NEXTGEN" shall mean NextGen Fiber Optics LLC, a Delaware limited
liability company, whose 49% Equity Interest is owned by Borrower.
"NET RECOVERY COST PERCENTAGE" shall mean the fraction, expressed as a
percentage, (a) the numerator of which is the amount equal to the recovery on
the aggregate amount of the Inventory at such time on a "net orderly liquidation
value" basis as set forth in the most recent Inventory Appraisal received by
Collateral Agent in accordance with Section 9.02, net of operating expenses,
liquidation expenses and commissions reasonably anticipated in the disposition
of such assets, and (b) the denominator of which is the original Cost of the
aggregate amount of the Inventory subject to appraisal.
"NOTES" shall mean any notes evidencing the Revolving Loans or
Swingline Loans issued pursuant to this Agreement, if any, substantially in the
form of Exhibit H-1 or H-2, as the case may be.
"OBLIGATION CURRENCY" shall have the meaning assigned to such term in
Section 11.16(a).
"OBLIGATIONS" shall mean (a) obligations of Borrower and any and all of
the other Loan Parties from time to time arising under or in respect of the due
and punctual payment of (i) the principal of and premium, if any, and interest
(including interest accruing during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding) on the Loans, when and as due, whether at
maturity, by acceleration, upon one or more dates set for prepayment or
otherwise, (ii) each payment required to be made by Borrower and any and all of
the other Loan Parties under this Agreement in respect of any Letter of Credit,
when and as due, including payments in respect of reimbursement of
disbursements, interest thereon and obligations to provide cash collateral and
(iii) all other monetary obligations, including fees, costs, expenses and
indemnities, whether primary, secondary, direct, contingent, fixed or otherwise
(including monetary obligations incurred during the pendency of any bankruptcy,
insolvency, receivership or other similar proceeding, regardless of whether
allowed or allowable in such proceeding), of Borrower and any and all of the
other Loan Parties under this Agreement and the other Loan Documents, (b) the
due and punctual performance of all covenants, agreements, obligations and
liabilities of Borrower and each Loan Party under or pursuant to this Agreement
and the other Loan Documents, (c) the due and punctual payment and performance
of all obligations of Borrower and any and all of the other Loan Parties under
each Specified Hedging Agreement entered into with any counterparty that is a
Lender or an Affiliate of a Lender or was a Lender or an Affiliate
32
of a Lender at the time such Specified Hedging Agreement was entered into, and
(d) the due and punctual payment and performance of all obligations in respect
of overdrafts and related liabilities owed to any Lender, any Affiliate of a
Lender, the Administrative Agent or the Collateral Agent arising from treasury,
depositary and cash management services or in connection with any automated
clearinghouse transfer of funds.
"OFFICERS' CERTIFICATE" shall mean a certificate executed by the
Chairman of the Board (if an officer), the Chief Executive Officer, the
President, one of the Financial Officers, each in his or her official (and not
individual) capacity.
"OTHER TAXES" shall mean any and all present or future stamp or
documentary taxes or any other excise or Property taxes, charges or similar
levies (including interest, fines, penalties and additions to tax) arising from
any payment made or required to be made under any Loan Document or from the
execution, delivery or enforcement of, or otherwise with respect to, any Loan
Document.
"OVERADVANCE" shall have the meaning assigned to such term in Section
10.10.
"PARTICIPANT" shall have the meaning assigned to such term in Section
11.04(e).
"PARTICIPATING MEMBER STATE" shall mean any member state which adopts
the euro unit of the single currency pursuant to the Treaty.
"PBGC" shall mean the Pension Benefit Guaranty Corporation referred to
and defined in ERISA.
"PERFECTION CERTIFICATE" shall mean a certificate in the form of
Exhibit I-1 or any other form approved by the Collateral Agent, as the same
shall be supplemented from time to time by a Perfection Certificate Supplement
or otherwise.
"PERFECTION CERTIFICATE SUPPLEMENT" shall mean a certificate supplement
in the form of Exhibit I-2 or any other form approved by the Collateral Agent.
"PERMITTED ACQUISITION" shall mean Permitted Loan Funded Acquisition,
Permitted Non-Loan Funded Acquisition, or either of them.
"PERMITTED ASSET SALE" shall mean, any Asset Sale made, directly or
indirectly, by Borrower or any Loan Party which meets each of the following
conditions:
(a) no Default then exists or would result therefrom;
(b) Borrower or such Loan Party, as the case may be, receives
consideration at the time of such Asset Sale at least equal to the Fair Market
Value of the assets sold or otherwise disposed of;
(c) at least 75% of such consideration received by Borrower or
such Loan Party consists of (i) cash or Cash Equivalents, (ii) assets (other
than securities) to be used in a business of a same or substantially similar
type as that conducted by Borrower and the Subsidiaries on the
33
Closing Date or (iii) a combination of cash, Cash Equivalents and such assets
described in clause (c)(ii) above; and
(d) in the case of any Permitted Asset Sale made by any Domestic
and Canadian Loan Party, the Collateral Agent has reasonably determined the
Fixed Asset Loan Value of any assets included in the Borrowing Base being sold
and made the appropriate adjustments to the Borrowing Base to reflect such Asset
Sale and following such adjustment, Borrower is in compliance with Section
6.08(c).
"PERMITTED FIXED ASSET EXCHANGE" shall mean, with respect to any
Equipment or Real Property (the "RELINQUISHED FIXED ASSET") of any Company, an
exchange by such Company, in a transaction or series of related transactions
simultaneously or substantially simultaneously consummated, of the Relinquished
Fixed Asset for one or more items of Equipment or Real Property (the "REPLACED
FIXED ASSET") of any Person which is useful in the conduct of such Company's
business and which meets each of the following conditions:
(a) no Default then exists or would result therefrom;
(b) is an exchange consummated pursuant to agreements,
instruments and documents which are submitted for review to the
Collateral Agent and the Administrative Agent no less than thirty (30)
calendar days prior to the consummation of such exchange and which are
reasonably satisfactory in their collective reasonable credit judgment
of the Collateral Agent and the Administrative Agent as to form and
substance;
(c) is an exchange of a Relinquished Fixed Asset located
in the United States or Canada owned by a Domestic or Canadian Company
for Replaced Fixed Assets located in the United States or Canada or is
an exchange of a Relinquished Fixed Asset located outside the United
State and Canada owned by a Foreign Company for Replaced Fixed Assets
located outside the United States or Canada;
(d) is an exchange of a Relinquished Fixed Asset the
Exchange Fair Market Value of which, when added to the Exchange Fair
Market Value of all Relinquished Fixed Assets exchanged in Permitted
Fixed Asset Exchanges since the Closing Date, does not exceed the U.S.
Dollar Equivalent of $75.0 million in the aggregate;
(e) the Borrower shall have certified to the Collateral
Agent and the Administration Agent the Exchange Fair Market Values of
both the Relinquished Fixed Assets and the Replaced Fixed Assets; and
(f) if a Relinquished Fixed Asset is a part of the
Collateral, it shall be exchanged for Replaced Fixed Assets with
respect to which, at the closing of any Permitted Fixed Asset Exchange,
the Collateral Agent will be granted a first priority perfected Lien
(subject to Permitted Liens under Sections 6.02(a), (b), (d) and (g))
pursuant to such documents and by such actions being taken as may be
reasonably required by the Collateral Agent, and if a Relinquished
Fixed Asset is Eligible Equipment or Eligible Real Property, (i) the
Replaced Fixed Assets shall also constitute Eligible Equipment or
Eligible Real Property, as the case may be, as determined by the
Collateral Agent in the Collateral Agent's reasonable credit judgment
and (ii) the Collateral Agent
34
shall determine the Fixed Asset Loan Value of the Replaced Fixed Asset
(including any Reserves which will be associated therewith) and the
Fixed Asset Loan Value of the Relinquished Fixed Assets;
provided, however, that to the extent (A) the Exchange Fair Market
Value of the Replaced Fixed Assets is less than the Exchange Fair
Market Value of the Relinquished Fixed Assets and/or (B) the Fixed
Asset Loan Value of the Replaced Fixed Assets (after giving effect to
any Reserves which will be associated therewith) determined under
clause (f)(ii) above is less than the Fixed Asset Loan Value of the
Relinquished Fixed Assets determined under clause (f)(ii) above (after
giving effect to any Reserves to be released as a result of the
disposition of such Property), Borrower shall immediately prepay the
Obligations (without reduction in Commitments) in the amount equal to
the greater of the difference obtained in clause (A) or clause (B) of
this proviso as if such amount constituted Net Cash Proceeds of an
Asset Sale.
For the purposes of this definition, "Exchange Fair Market Value" shall
mean Fair Market Value; provided, however, that the Fair Market Value of any
Relinquished Fixed Asset or any Replaced Fixed Asset in excess of $1.0 million
but less than $5.0 million shall be determined conclusively by the board of
directors of Borrower (or a duly authorized committee thereof) acting in good
faith and shall be evidenced by a resolution of such board of directors
delivered to the Administrative Agent and the Collateral Agent; and provided,
further, however, that the Fair Market Value of any Relinquished Fixed Asset or
any Replaced Fixed Asset in excess of $5.0 million shall be determined by the
board of directors of the Borrower as provided in the immediately preceding
proviso, whose determination, however, shall not be conclusive but which shall
be supported by an appraisal as may be requested the Collateral Agent or the
Administrative Agent, at the expense of the Borrower, by an independent,
third-party appraiser designated by the Collateral Agent and reasonably
acceptable to the Borrower.
"PERMITTED LIENS" shall have the meaning assigned to such term in
Section 6.02.
"PERMITTED LOAN FUNDED ACQUISITION" shall mean, with respect to
Borrower or any Borrowing Base Guarantor other than Holdings or Intermediate
Holdings, any transaction or series of related transactions for the direct or
indirect (a) acquisition of all or substantially all of the Property of any
other Person, or of any business, product line or division of any other Person;
(b) acquisition of in excess of 50% of the Equity Interests of any other Person,
or otherwise causing any other Person to become a Subsidiary of such Person; or
(c) merger or consolidation or any other combination with any other Person (so
long as the Borrower or a Borrowing Base Guarantor is the surviving entity), if
each of the following conditions are met, as reasonably determined by the
Administrative Agent and the Collateral Agent:
(i) no Default then exists or would result therefrom;
(ii) after giving effect to such acquisition on a Pro
Forma Basis, (A) Borrower shall be in compliance with all covenants set
forth in Section 6.08 as of the most recent Test Period (assuming, for
purposes of Section 6.08, that such acquisition, and all other
Permitted Loan Funded Acquisitions consummated since the first day of
the relevant Test Period for each of the financial covenants set forth
in Section 6.08 ending on or prior to
35
the date of such acquisition, had occurred on the first day of such
relevant Test Period), (B) the Companies can reasonably be expected to
remain in compliance with such covenants through the Maturity Date and
to have sufficient cash liquidity to conduct their business and pay
their respective debts and other liabilities as they come due and (C)
Excess Availability for the 90-day period preceding the consummation of
such acquisition would have exceeded $75.0 million on a Pro Forma Basis
(after giving effect to such acquisition and the Revolving Loans funded
in connection therewith as if made on the first day of such period) and
the projections in connection with the proposed acquisition (based upon
historical financial data of a recent date reasonably satisfactory to
Collateral Agent, taking into account the proposed acquisition) shall
reflect that such Excess Availability of $75.0 million shall continue
for at least 2 years after the consummation of such acquisition; for
the purposes of this paragraph (ii) the amount of outstanding Loans and
LC Exposure in clause (b) of the definition of the term "Excess
Availability" shall be calculated on the basis of the average daily
outstanding Loans and LC Exposure for the applicable measuring period;
(iii) no Company shall, in connection with any such
acquisition, assume or remain liable with respect to any Indebtedness
or other liability (including any material tax or ERISA liability) of
the related seller, except (A) to the extent permitted under Section
6.01, and (B) obligations of the seller incurred in the ordinary course
of business and necessary or desirable to the continued operation of
the underlying properties, and any other such liabilities or
obligations not permitted to be assumed or otherwise supported by any
Company hereunder shall be paid in full or released as to the assets
being so acquired on or before the consummation of such acquisition;
(iv) the acquired Person shall be engaged in a business of
a same or substantially similar type as that conducted by Borrower and
the Subsidiaries on the Closing Date and the Property acquired in
connection with any such acquisition shall be made subject to the Lien
of the Security Documents and shall be free and clear of any Liens,
other than Permitted Liens;
(v) Collateral Agent shall have received (except with
respect to asset acquisitions) the Joinder Agreement from the acquired
Person, joinder agreement to the Security Documents in the form annexed
thereto and such other supplemental agreements, blocked account
agreements and other agreements, instruments and documents in
connection therewith as reasonably requested by the Collateral Agent
together with all opinions, certificates, lien search results and other
documents, agreements, instruments and reasonably requested by the
Collateral Agent, all in form and substance reasonably satisfactory to
the Collateral Agent;
(vi) the board of directors or other similar governing
body of the acquired Person shall not have indicated publicly its
opposition to the consummation of such acquisition;
(vii) with respect to any acquisition involving Acquisition
Consideration of more than $1.0 million, Borrower shall have provided
the Administrative Agent and the Lenders with (A) historical financial
statements for the last three fiscal years of the
36
Person or business to be acquired (audited if available without undue
cost or delay) and unaudited financial statements thereof for the most
recent interim period which are available, (B) reasonably detailed
projections for the succeeding 2 years pertaining to the Person or
business to be acquired, (C) a reasonably detailed description of all
material information relating thereto and copies of all material
documentation pertaining to such acquisition, and (D) all such other
information and data relating to such acquisition or the Person or
business to be acquired as may be reasonably requested by the
Administrative Agent or the Required Lenders;
(viii) Borrower shall have delivered to the Administrative
Agent, the Collateral Agent and the Lenders an Officers' Certificate
certifying that (A) such acquisition complies with this definition
(which shall have attached thereto reasonably detailed backup data and
calculations showing such compliance), and (B) such acquisition could
not reasonably be expected to result in a Material Adverse Effect;
(ix) such acquisition shall be consensual and shall have
been approved by the board of directors of the Person being acquired;
and
(x) the aggregate Acquisition Consideration for all
Permitted Loan Funded Acquisitions since the Closing Date shall not
exceed $55.0 million; provided, that any Equity Interests constituting
all or a portion of Acquisition Consideration shall not have a cash
dividend requirement on or prior to the Maturity Date.
Notwithstanding the foregoing, the Accounts and Inventory of the Person
to be acquired or comprising the assets to be acquired shall not be included as
Eligible Accounts or Eligible Inventory until a field audit with respect thereto
has been completed to the satisfaction of the Collateral Agent, including the
establishment of Reserves required in the Collateral Agent's reasonable credit
judgment.
"PERMITTED NON-LOAN FUNDED ACQUISITION" shall mean, with respect to
Borrower, any Borrowing Base Guarantor (other than Holdings), or any Foreign
Subsididiary, any transaction or series of related transactions for the direct
or indirect (a) acquisition of all or substantially all of the Property of any
other Person, or of any business, product line or division of any other Person;
(b) acquisition of in excess of 50% of the Equity Interests of any other Person,
or otherwise causing any other Person to become a Subsidiary of such Person; or
(c) merger or consolidation or any other combination with any other Person (so
long as the Borrower or a Borrowing Base Guarantor is the surviving entity), if
each of the following conditions are met, as reasonably determined by the
Administrative Agent and the Collateral Agent:
(i) no Default then exists or would result therefrom;
(ii) Acquisition Consideration consists entirely of
proceeds of an Acquisition Debt Issuance permitted hereunder or Equity
Issuance or entirely of a combination of cash which is provided by
Foreign Subsidiaries and proceeds of Acquisition Debt Issuance
permitted hereunder or Equity Issuance;
(iii) such acquisition shall be consensual and shall have
been approved by the board of directors of the Person being acquired;
and
37
(iv) after giving effect to such acquisition on a Pro
Forma Basis, (A) Borrower shall be in compliance with all covenants set
forth in Section 6.08 as of the most recent Test Period (assuming, for
purposes of Section 6.08, that such acquisition, and all other
Permitted Non-Loan Funded Acquisitions consummated since the first day
of the relevant Test Period for each of the financial covenants set
forth in Section 6.08 ending on or prior to the date of such
acquisition, had occurred on the first day of such relevant Test
Period), (B) the Companies can reasonably be expected to remain in
compliance with such covenants through the Maturity Date and to have
sufficient cash liquidity to conduct their business and pay their
respective debts and other liabilities as they come due and (C) Excess
Availability for the 90-day period preceding the consummation of such
acquisition would have exceeded $35.0 million on a Pro Forma basis
(after giving effect to such acquisition and the Revolving Loans funded
in connection therewith as if made on the first day of such period) and
the projections in connection with the proposed acquisition (based upon
historical financial data of a recent date reasonably satisfactory to
the Administrative Agent and the Collateral Agent, taking into account
the proposed acquisition) shall reflect that such Excess Availability
of $35.0 million shall continue for at least 2 years after the
consummation of such acquisition; for the purposes of this paragraph
(iv), the amount of outstanding Loans and LC Exposure in clause (b) of
the definition of the term "Excess Availability" shall be calculated on
the basis of the average daily outstanding Loans and LC Exposure for
the applicable measuring period.
"PERSON" shall mean any natural Person, corporation, business trust,
joint venture, association, company, limited liability company, partnership or
government, or any agency or political subdivision thereof.
"PLAN" shall mean any "employee pension benefit plan" as such term is
defined in Section 3(2) of ERISA (other than a Multiemployer Plan) subject to
the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of
ERISA which is maintained or contributed to by any Company or its ERISA
Affiliate or with respect to which any Company could incur liability (including,
without limitation, under Section 4069 of ERISA).
"PNC HEDGE AGREEMENT" shall mean that certain ISDA Master Agreement
(and related Schedule) between General Cable Corporation and PNC Bank, National
Association, dated as of November 5, 2001, for a notional amount of $9.0
million, with a maturity of November 11, 2011, as amended by that certain ISDA
Amendment to the ISDA Master Agreement dated as of November 24, 2003 and as the
same may be amended, modified or supplemented from time to time.
"PPSA" shall mean the Personal Property Security Act as from time to
time in effect in the Province of Nova Scotia and the regulations thereunder, as
from time to time in effect, provided, however, if validity, attachment,
perfection or priority of Collateral Agent's security interests in any
Collateral are governed by the personal property security laws of any
jurisdiction in Canada other than Nova Scotia, "PPSA" shall mean those personal
property security laws in such other jurisdiction for the purposes of the
provisions hereof relating to such validity, attachment, perfection or priority
and for the definitions related to such provisions.
38
"PREFERRED STOCK" shall mean, with respect to any Person, any and all
preferred or preference Equity Interests (however designated) of such Person
whether now outstanding or issued after the Closing Date.
"PRIOR LIEN" shall have the meaning assigned to such term in the
applicable Security Document.
"PRO FORMA BASIS" shall mean on a basis in accordance with GAAP and
Regulation S-X under the Securities Act and otherwise reasonably satisfactory to
the Administrative Agent.
"PRO RATA PERCENTAGE" of any Revolving Lender at any time shall mean
the percentage of the total Revolving Commitment represented by such Lender's
Revolving Commitment.
"PROPERTY" shall mean any right, title or interest in or to property or
assets of any kind whatsoever, whether real, personal or mixed and whether
tangible or intangible and including Equity Interests or other ownership
interests of any Person and whether now in existence or owned or hereafter
entered into or acquired, including, without limitation, all Real Property.
"PURCHASE MONEY OBLIGATION" shall mean, for any Person, the obligations
of such Person in respect of Indebtedness incurred for the purpose of financing
all or any part of the purchase price of any Property (including Equity
Interests of any Person) or the cost of installation, construction or
improvement of any Property or assets and any refinancing thereof; provided,
however, that such Indebtedness is incurred within 90 days after such
acquisition of such Property by such Person.
"QUALIFIED CAPITAL STOCK" of any Person shall mean any capital stock of
such Person that is not Disqualified Capital Stock.
"QUALIFIED SENIOR NOTE DOCUMENTS" shall mean the Qualified Senior Note
Indenture and other agreement pursuant to which the Qualified Senior Notes are
issued as contemplated by the Confidential Information Memorandum related to
9.5% Senior Notes and all other documents executed and delivered with respect to
the Qualified Senior Notes.
"QUALIFIED SENIOR NOTE INDENTURE" shall mean that certain Indenture,
dated as of November 24, 2003, among Holdings, the guarantors named therein and
US Bank National Association, as trustee, with respect to the Qualified Senior
Notes, as in effect on the Closing Date.
"QUALIFIED SENIOR NOTES" shall mean Holdings' 9.5% Senior Notes due
2010 issued pursuant to the Qualified Senior Note Documents and any registered
notes issued by Holdings in exchange for, and as contemplated by the Notes, with
substantially identical terms as the Notes.
"REAL PROPERTY" shall mean, collectively, all right, title and interest
(including any leasehold estate) in and to any and all parcels of or interests
in real Property owned, leased or operated by any Person, whether by lease,
license or other means, together with, in each case, all easements,
hereditaments and appurtenances relating thereto, all improvements and
appurtenant fixtures and equipment, all general intangibles and contract rights
and other Property and rights incidental to the ownership, lease or operation
thereof.
39
"REFINANCING" shall mean the repayment in full and the termination of
any commitment to make extensions of credit under all of the outstanding
indebtedness of Holdings and Borrower and Guarantors listed on Schedule 1.01(b).
"REGISTER" shall have the meaning assigned to such term in Section
11.04(c).
"REGULATION D" shall mean Regulation D of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REGULATION T" shall mean Regulation T of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REGULATION U" shall mean Regulation U of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REGULATION X" shall mean Regulation X of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"REINVESTMENT RESERVE" shall have the meaning assigned to such term in
Section 2.10(g).
"RELEASE" shall mean any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, disposing,
depositing, dispersing, emanating or migrating of any Hazardous Material in,
into, onto or through the Environment.
"REQUIRED LENDERS" shall mean, at any time, Lenders having more than
fifty percent (50%) of the Revolving Commitments or, if the Revolving
Commitments have been terminated, more than fifty percent (50%) of the sum of
Revolving Exposure.
"REQUIREMENTS OF LAW" shall mean, collectively, any and all
requirements of any Governmental Authority including any and all laws,
ordinances, rules, regulations or similar statutes or case law.
"RESERVES" shall mean reserves established against the Borrowing Base
that the Collateral Agent may, in its reasonable credit judgment, establish from
time to time and that has a reasonable relationship to the event, condition or
other matter which is the basis for such Reserve as determined by the Collateral
Agent in good faith. Without limiting the generality of the foregoing, Reserves
shall include any Hedging Reserve, Reinvestment Reserve (including any Line
Reserve) and Canadian Priority Payment Reserve.
"RESPONSE" shall mean (a) "response" as such term is defined in CERCLA,
42 U.S.C. Section 9601(24), and (b) all other actions required by any
Governmental Authority or voluntarily undertaken to: (i) clean up, remove,
treat, xxxxx or in any other way address any Hazardous Material in the
environment; (ii) prevent the Release or threat of Release, or minimize the
further Release, of any Hazardous Material; or (iii) perform studies and
investigations in connection with, or as a precondition to, clause (i) or (ii)
above.
40
"RESPONSIBLE OFFICER" of any corporation shall mean any executive
officer or Financial Officer of such corporation and any other officer or
similar official thereof with responsibility for the administration of the
obligations of such corporation in respect of this Agreement.
"RESTRICTED PAYMENTS" with respect to any Company shall mean (a) a
declaration or payment of a dividend or return of any equity capital to its
stockholders or other equity holders or authorization or the incurrence of any
liability to make any other payment, distribution or delivery of other Property
in respect of Equity Interest (other than common stock of such Company) or cash
to its stockholders or other equity holders as such, (b) redemption, retirement,
purchase, defeasance, or other acquisition, direct or indirect, for a
consideration of any shares of any class of its capital stock or other Equity
Interest outstanding (or any options or warrants issued by such Person with
respect to its capital stock or other Equity Interest), or setting aside any
funds or any payments on account of the sinking fund for any of the foregoing
purposes, or permitting any of Subsidiaries of such Company to purchase or
otherwise acquire for a consideration any shares of any class of the capital
stock of such Person outstanding (or any options or warrants issued by such
Person with respect to its capital stock), (c) any payment or prepayment of
principal of, premium, if any, or interest, fees or other charges on or with
respect to, and any redemption, purchase, retirement, defeasance, sinking fund
or similar payment and any claim for rescission with respect to, any
Indebtedness expressly subordinated as to right and time of payment to the prior
indefeasible payment in full in cash of the Obligations (provided, that the
Qualified Senior Notes shall not be deemed, for the purposes hereof, to be
subordinated by reason of being unsecured), (d) any payment of a claim for the
rescission of the purchase or sale of, or for material damages arising from the
purchase or sale of, any Equity Interest in such Company or of a claim for
reimbursement, indemnification or contribution arising out of or related to any
such claim for damages or rescission and (e) any payment, loan, contribution, or
other transfer of funds or other Property to any stockholder or any other equity
holder of such Company other than payment of compensation in the ordinary course
of business to stockholders or other equity holders who are employees of such
Company. Without limiting the foregoing, "Restricted Payments" with respect to
any Company shall also include all payments made or required to be made by such
Company with respect to any stock appreciation right, plan, equity incentive or
achievement plans or any similar plans or setting aside of any funds for the
foregoing purposes.
"REVOLVING AVAILABILITY PERIOD" shall mean the period from and
including the Closing Date to but excluding the earlier of the Maturity Date and
the date of termination of the Revolving Commitments.
"REVOLVING BORROWING" shall mean a Borrowing comprised of Revolving
Loans.
"REVOLVING COMMITMENT" shall mean, with respect to each Lender, the
commitment, if any, of such Lender to make Revolving Loans hereunder up to the
amount set forth on Schedule I to the Lender Addendum executed and delivered by
such Lender, or in the Assignment and Acceptance pursuant to which such Lender
assumed its Revolving Commitment, as applicable, as the same may be (a) reduced
from time to time pursuant to Section 2.07 and (b) reduced or increased from
time to time pursuant to assignments by or to such Lender pursuant to Section
11.04. The aggregate amount of the Lenders' Revolving Commitments on the Closing
Date is $240.0 million.
41
"REVOLVING EXPOSURE" shall mean, with respect to any Lender at any
time, the aggregate principal amount at such time of all outstanding Revolving
Loans of such Lender, plus the aggregate amount at such time of such Lender's LC
Exposure, plus the aggregate amount at such of such Lender's Swingline Exposure.
"REVOLVING LENDER" shall mean a Lender with a Revolving Commitment.
"REVOLVING LOANS" shall mean a Loan made by the Lenders to Borrower
pursuant to Section 2.01(a).
"XXXXXXXX-XXXXX ACT" shall mean the United States Xxxxxxxx-Xxxxx Act of
2002.
"SEC" shall mean the Securities and Exchange Commission of the United
States of America.
"SECURITIES ACCOUNT CONTROL AGREEMENT" shall have the meaning assigned
to such term in the Security Agreement.
"SECURED PARTIES" shall mean, collectively, the Administrative Agent,
the Collateral Agent, the Lenders, Issuing Bank and each party to a Hedging
Agreement relating to the Loans if at the date of entering into such Hedging
Agreement such Person was a Lender or an Affiliate of a Lender and such
Affiliate executes and delivers to the Administrative Agent a letter agreement
in form and substance acceptable to the Administrative Agent pursuant to which
such Person (i) appoints the Collateral Agent as its agent under the applicable
Loan Documents, (ii) agrees to be bound by the provisions of Section 9.05 and
(iii) ratifies the constitution of the Collateral Agent as the holder of an
irrevocable power of attorney (fonde de pouvoir) as provided in Section
10.01(b).
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended.
"SECURITY AGREEMENTS" shall mean a Security Agreement substantially in
the form of Exhibit J among the Loan Parties and Collateral Agent for the
benefit of the Secured Parties and Canadian Security Agreement.
"SECURITY AGREEMENT COLLATERAL" shall mean all Property pledged or
granted as collateral pursuant to the Security Agreements delivered on the
Closing Date or thereafter pursuant to Section 5.11.
"SECURITY DOCUMENTS" shall mean the Security Agreements, the Mortgages,
the Perfection Certificate, Foreign Guaranties, Foreign Pledge Agreements,
Canadian Pledge Agreements and each other security document or pledge agreement
delivered in accordance with applicable local or foreign law to grant a valid,
perfected security interest in any Property, and all UCC or PPSA or other
financing statements or instruments of perfection required by such Security
Documents, to be filed with respect to the security interests in Property and
fixtures created pursuant to such Security Documents and any other document or
instrument utilized to pledge as collateral for the Obligations any Property of
whatever kind or nature.
"SELLER" has the meaning assigned to such term in the first recital
hereto.
42
"SPECIAL AGENT ADVANCE" shall have the meaning assigned to such term in
Section 10.11.
"SPECIFIED HEDGING AGREEMENTS" shall mean the PNC Hedge Agreement or
any Hedging Agreements made or entered into at any time, or in effect at any
time (whether heretofore or hereafter) between Borrower or any Borrowing Base
Guarantors and a counterparty to a Hedging Agreement reasonably satisfactory to
the Administrative Agent and the Collateral Agent (which may include any Lender
hereunder) and on terms reasonably satisfactory to the Administrative Agent and
the Collateral Agent.
"STANDBY LETTER OF CREDIT" shall mean any standby letter of credit or
similar instrument issued for the purpose of supporting (a) workers'
compensation liabilities of Borrower or any Borrowing Base Guarantor, (b) the
obligations of third-party insurers of Borrower or any Borrowing Base Guarantor
arising by virtue of the laws of any jurisdiction requiring third-party insurers
to obtain such letters of credit, or (c) performance, payment, deposit or surety
obligations of Borrower or any Borrowing Base Guarantor if required by law or
governmental rule or regulation or in accordance with custom and practice in the
industry.
"STATUTORY RESERVES" shall mean, for any Interest Period for any
Eurodollar Revolving Borrowing, the average maximum rate at which reserves
(including any marginal, supplemental or emergency reserves) are required to be
maintained during such Interest Period under Regulation D by member banks of the
United States Federal Reserve System in New York City with deposits exceeding
one billion Dollars against "Eurodollar liabilities" (as such term is used in
Regulation D). Eurodollar Revolving Borrowings shall be deemed to constitute
Eurodollar liabilities and to be subject to such reserve requirements without
benefit of or credit for proration, exceptions or offsets which may be available
from time to time to any Lender under Regulation D.
"SUBSIDIARY" shall mean, with respect to any Person (the "PARENT") at
any date, any corporation, limited liability company, partnership, association
or other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing more
than 50% of the ordinary voting power or, in the case of a partnership, more
than 50% of the general partnership interests are, as of such date, owned,
controlled or held, or (b) that is, as of such date, otherwise Controlled, by
the parent or one or more Subsidiaries of the parent or by the parent and one or
more Subsidiaries of the parent. Unless otherwise set forth herein, reference in
this Agreement to "Subsidiary" shall mean Holdings' direct and indirect
Subsidiaries.
"SUPERMAJORITY LENDERS" shall mean, at any time, Lenders having at
least 80% of the Revolving Commitments or, if the Revolving Commitments have
been terminated, at least 80% of the sum of Revolving Exposure.
"SURVEY" shall mean a survey of any Mortgaged Real Property (and all
improvements thereon) (i) prepared by a surveyor or engineer licensed to perform
surveys in the state where such Mortgaged Real Property is located, (ii) dated
(or redated) not earlier than six months prior
43
to the date of delivery thereof unless there shall have occurred within six
months prior to such date of delivery any exterior construction on the site of
such Mortgaged Real Property, in which event such survey shall be dated (or
redated) after the completion of such construction or if such construction shall
not have been completed as of such date of delivery, not earlier than 20 days
prior to such date of delivery, (iii) certified by the surveyor (in a manner
reasonably acceptable to the Administrative Agent and the Collateral Agent) to
the Administrative Agent, the Collateral Agent and the Title Company, (iv)
complying in all respects with the minimum detail requirements of the American
Land Title Association as such requirements are in effect on the date of
preparation of such survey and (v) sufficient for the Title Company to remove
all standard survey exceptions from the title insurance policy (or commitment)
relating to such Mortgaged Real Property and issue the endorsements of the type
required by Section 4.01(o)(iii).
"SWINGLINE COMMITMENT" shall mean the commitment of the Swingline
Lender to make loans pursuant to Section 2.17, as the same may be reduced from
time to time pursuant to Section 2.07 or Section 2.17.
"SWINGLINE EXPOSURE" shall mean at any time the aggregate principal
amount at such time of all outstanding Swingline Loans. The Swingline Exposure
of any Revolving Lender at any time shall equal its Pro Rata Percentage of the
aggregate Swingline Exposure at such time.
"SWINGLINE LENDER" shall have the meaning assigned to such term in the
preamble hereto.
"SWINGLINE LOAN" shall mean any Loan made by the Swingline Lender
pursuant to Section 2.17.
"SYNDICATION AGENT" shall have the meaning assigned to such term in the
preamble hereto.
"TAX RETURN" shall mean all returns, statements, filings, attachments
and other documents or certifications required to be filed in respect of Taxes.
"TAX SHARING AGREEMENTS" shall mean all tax sharing, tax allocation and
other similar agreements entered into by Holdings or any Subsidiary of Holdings.
"TAXES" shall mean (i) any and all present or future taxes, duties,
levies, fees, imposts, assessments, deductions, withholdings or other charges,
whether computed on a separate, consolidated, unitary, combined or other basis
and any and all liabilities (including interest, fines, penalties or additions
to tax) with respect to the foregoing, and (ii) any transferee, successor, joint
and several, contractual or other liability (including, without limitation,
liability pursuant to Treasury Regulation Section 1.1502-6 (or any similar
provision of state, local or non-U.S. law)) in respect of any item described in
clause (i).
"TEST PERIOD" shall mean, at any time, the four consecutive fiscal
quarters of Borrower then last ended (in each case taken as one accounting
period) for which financial statements have been or are required to be delivered
to the Administrative Agent pursuant to Section 5.01(a) or (b).
44
"TITLE COMPANY" shall mean any title insurance company as shall be
retained by Borrower and reasonably acceptable to the Administrative Agent.
"TITLE POLICY" shall have the meaning assigned to such term in Section
4.01(o).
"TRANSACTION DOCUMENTS" shall mean the Equity Financing Documents,
Qualified Senior Note Documents and the Loan Documents.
"TRANSACTIONS" shall mean, collectively, the transactions to occur on
or prior to the Closing Date pursuant to the Transaction Documents, including
(a) the execution and delivery of the Loan Documents and the initial borrowings
hereunder; (b) the Refinancing; (c) the Equity Financing; (d) the execution and
delivery of the Qualified Senior Note Documents and the financing contemplated
thereunder; and (e) the payment of all fees and expenses to be paid on or prior
to the Closing Date and owing in connection with the foregoing.
"TREASURY REGULATION" means the regulations promulgated under the Code.
"TREATY" shall mean the treaty establishing the European Community
being the Treaty of Rome as amended from time to time.
"TYPE," when used in reference to any Loan or Borrowing, refers to
whether the rate of interest on such Loan, or on the Loans comprising such
Borrowing, is determined by reference to the Adjusted LIBOR Rate or the
Alternate Base Rate.
"UBS" shall have the meaning assigned to such term in the preamble
hereto.
"UCC" shall mean the Uniform Commercial Code of the State of New York
or of any other state the laws of which are required to be applied in connection
with the perfection of security interests in any Collateral.
"WHOLLY OWNED SUBSIDIARY" shall mean, as to any Person, (a) any
corporation 100% of whose capital stock (other than directors' qualifying
shares) is at the time owned by such Person and/or one or more Wholly Owned
Subsidiaries of such Person and (b) any partnership, association, joint venture,
limited liability company or other entity in which such Person and/or one or
more Wholly Owned Subsidiaries of such Person have a 100% Equity Interest at
such time. Unless otherwise set forth herein, reference in this Agreement to
"Wholly Owned Subsidiary" shall mean Holdings' direct and indirect Wholly Owned
Subsidiaries.
"WITHDRAWAL LIABILITY" shall mean liability to a Multiemployer Plan as
a result of a complete or partial withdrawal from such Multiemployer Plan, as
such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02 CLASSIFICATION OF LOANS AND BORROWINGS. For purposes of
this Agreement, Loans may be classified and referred to by Class (e.g., a
"REVOLVING LOAN") or by Type (e.g., a "EURODOLLAR REVOLVING LOAN") or by Class
and Type (e.g., a "EURODOLLAR REVOLVING LOAN"). Borrowings also may be
classified and referred to by Class (e.g., a "REVOLVING BORROWING") or by Type
(e.g., a "EURODOLLAR REVOLVING BORROWING") or by Class and Type (e.g., a
"EURODOLLAR REVOLVING BORROWING").
45
SECTION 1.03 TERMS GENERALLY. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "INCLUDE", "INCLUDES" and "INCLUDING" shall
be deemed to be followed by the phrase "WITHOUT LIMITATION". The word "WILL"
shall be construed to have the same meaning and effect as the word "SHALL".
Unless the context requires otherwise (a) any definition of or reference to any
Loan Document, agreement, instrument of other document herein shall be construed
as referring to such agreement, instrument or other document as from time to
time amended, supplemented or otherwise modified (subject to any restrictions on
such amendments, supplements or modifications set forth herein), (b) any
reference herein to any Person shall be construed to include such Person's
successors and assigns, (c) the words "HEREIN", "HEREOF" and "HEREUNDER", and
words of similar import, shall be construed to refer to this Agreement in its
entirety and not to any particular provision hereof, (d) all references herein
to Articles, Sections, Exhibits and Schedules shall be construed to refer to
Articles and Sections of, and Exhibits and Schedules to, this Agreement, and (f)
the words "ASSET" and "PROPERTY" shall be construed to have the same meaning and
effect and to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts and contract rights.
SECTION 1.04 ACCOUNTING TERMS; GAAP. Except as otherwise expressly
provided herein, all financial statements to be delivered pursuant to this
Agreement shall be prepared in accordance with GAAP as in effect from time to
time and all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect on the date hereof unless agreed to by
Borrower and the Required Lenders. In the event that any "Accounting Change" (as
defined below) shall occur and such change results in a change in the method of
calculation of financial covenants, standards or terms in this Agreement, then
the Borrower and the Administrative Agent agree to enter into negotiations in
order to amend such provisions of this Agreement so as to equitably reflect such
Accounting Changes with the desired result that the criteria for evaluating the
Borrower's financial condition shall be the same after such Accounting Changes
as if such Accounting Changes had not been made. Until such time as such an
amendment shall have been executed and delivered by the Borrower and the
Required Lenders, all financial covenants, standards and terms in this Agreement
shall continue to be calculated or construed as if such Accounting Changes had
not occurred. "ACCOUNTING CHANGES" refers to changes in accounting principles
required by the promulgation of any rule, regulation, pronouncement or opinion
by the Financial Accounting Standards Board of the American Institute of
Certified Public Accountants or, if applicable, the Securities and Exchange
Commission (or successors thereto or agencies with similar functions).
ARTICLE II.
THE CREDITS
SECTION 2.01 COMMITMENTS. Subject to the terms and conditions and
relying upon the representations and warranties herein set forth, each Revolving
Lender agrees, severally and not jointly:
(a) to make Revolving Loans to Borrower, at any time and from time to
time after the Closing Date until the earlier of one Business Day prior to the
Maturity Date and the termination
46
of the Revolving Commitment of such Lender in accordance with the terms hereof,
in an aggregate principal amount at any time outstanding that will not (subject
to provisions of Sections 10.10 and 10.11) result in such Lender's Revolving
Exposure exceeding the lesser of (A) such Lender's Revolving Commitment less
such Lender's Pro Rata Percentage of any Line Reserve and (B) such Lender's Pro
Rata Percentage multiplied by the Borrowing Base then in effect.
(b) Within the limits set forth in clause (a) above and subject to the
terms, conditions and limitations set forth herein, Borrower may borrow, pay or
prepay and reborrow Revolving Loans.
SECTION 2.02 LOANS. (a) Each Loan (other than Swingline Loans) shall be
made as part of a Borrowing consisting of Loans made by the Lenders ratably in
accordance with their applicable Commitments; provided, that the failure of any
Lender to make any Loan shall not in itself relieve any other Lender of its
obligation to lend hereunder (it being understood, however, that no Lender shall
be responsible for the failure of any other Lender to make any Loan required to
be made by such other Lender). Except for Loans deemed made pursuant to Section
2.02(f), Loans (other than Swingline Loans) comprising any Borrowing shall be in
an aggregate principal amount that is (i) in the case of ABR Loans, integral
multiples of $1.0 million and not less than $5.0 million or (B) in the case of
Eurodollar Revolving Loans, an integral multiple of $1.0 million and not less
than $5.0 million or (ii) equal to the remaining available balance of the
applicable Revolving Commitments.
(b) Subject to Sections 2.11 and 2.12, each Borrowing shall be
comprised entirely of ABR Loans or Eurodollar Revolving Loans as Borrower may
request pursuant to Section 2.03. Each Lender may at its option make any
Eurodollar Revolving Loan by causing any domestic or foreign branch or Affiliate
of such Lender to make such Loan; provided, that any exercise of such option
shall not affect the obligation of Borrower to repay such Loan in accordance
with the terms of this Agreement. Borrowings of more than one Type may be
outstanding at the same time; provided further that Borrower shall not be
entitled to request any Borrowing that, if made, would result in more than six
Eurodollar Revolving Borrowings outstanding hereunder at any one time. For
purposes of the foregoing, Borrowings having different Interest Periods,
regardless of whether they commence on the same date, shall be considered
separate Borrowings.
(c) Except with respect to Loans made pursuant to Section 2.02(f), each
Lender shall make each Loan (other than Swingline Loans) to be made by it
hereunder on the proposed date thereof by wire transfer of immediately available
funds to such account in New York City as the Administrative Agent may designate
not later than 12:00 (noon), New York City time, and the Administrative Agent
shall promptly credit the amounts so received to an account as directed by
Borrower in the applicable Borrowing Request maintained with the Administrative
Agent or, if a Borrowing shall not occur on such date because any condition
precedent herein specified shall not have been met, return the amounts so
received to the respective Lenders.
(d) Unless the Administrative Agent shall have received notice from a
Lender prior to the date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender's portion of such Borrowing,
the Administrative Agent may assume that such Lender has made such portion
available to the Administrative Agent on the date of such
47
Borrowing in accordance with paragraph (c) above, and the Administrative Agent
may, in reliance upon such assumption, make available to Borrower on such date a
corresponding amount. If the Administrative Agent shall have so made funds
available then, to the extent that such Lender shall not have made such portion
available to the Administrative Agent, such Lender and Borrower severally agree
to repay to the Administrative Agent forthwith on demand such corresponding
amount together with interest thereon, for each day from the date such amount is
made available to Borrower until the date such amount is repaid to the
Administrative Agent at (i) in the case of Borrower, the interest rate
applicable at the time to the Loans comprising such Borrowing and (ii) in the
case of such Lender, a rate determined by the Administrative Agent to represent
its cost of overnight or short-term funds (which determination shall be
conclusive absent manifest error). If such Lender shall repay to the
Administrative Agent such corresponding amount, such amount shall constitute
such Lender's Loan as part of such Borrowing for purposes of this Agreement.
(e) Notwithstanding any other provision of this Agreement, Borrower
shall not be entitled to request, or to elect to convert or continue, any
Borrowing if the Interest Period requested with respect thereto would end after
the Maturity Date.
(f) If the Issuing Bank shall not have received from Borrower the
payment required to be made by Section 2.18(e) within the time specified in such
Section, the Issuing Bank will promptly notify the Administrative Agent and the
Collateral Agent of the LC Disbursement and the Administrative Agent will
promptly notify each Revolving Lender of such LC Disbursement and its Pro Rata
Percentage thereof. Each Revolving Lender shall pay by wire transfer of
immediately available funds to the Administrative Agent on such date (or, if
such Revolving Lender shall have received such notice later than 12:00 (noon),
New York City time, on any day, not later than 12:00 (noon), New York City time,
on the immediately following Business Day), an amount equal to such Lender's Pro
Rata Percentage of such LC Disbursement (it being understood that such amount
shall be deemed to constitute an ABR Revolving Loan of such Lender, and such
payment shall be deemed to have reduced the LC Exposure), and the Administrative
Agent will promptly pay to the Issuing Bank amounts so received by it from the
Revolving Lenders. The Administrative Agent will promptly pay to the Issuing
Bank any amounts received by it from Borrower pursuant to Section 2.18(e) prior
to the time that any Revolving Lender makes any payment pursuant to this
paragraph (f); any such amounts received by the Administrative Agent thereafter
will be promptly remitted by the Administrative Agent to the Revolving Lenders
that shall have made such payments and to the Issuing Bank, as their interests
may appear. If any Revolving Lender shall not have made its Pro Rata Percentage
of such LC Disbursement available to the Administrative Agent as provided above,
such Lender and Borrower severally agree to pay interest on such amount, for
each day from and including the date such amount is required to be paid in
accordance with this paragraph (f) to but excluding the date such amount is
paid, to the Administrative Agent for the account of the Issuing Bank at (i) in
the case of Borrower, a rate per annum equal to the interest rate applicable to
Revolving Loans pursuant to Section 2.06(a), and (ii) in the case of such
Lender, for the first such day, the Federal Funds Effective Rate, and for each
day thereafter, the Alternate Base Rate.
SECTION 2.03 BORROWING PROCEDURE. To request a Revolving Borrowing,
Borrower shall notify the Administrative Agent of such request by telephone
(promptly confirmed by telecopy) (i) in the case of a Eurodollar Revolving
Borrowing, not later than 11:00 a.m., New
48
York City time, three Business Days before the date of the proposed Borrowing or
(ii) in the case of an ABR Borrowing, (other than Swingline Loans), not later
than 10:00 a.m., New York City time, on the Business Day of the proposed
Borrowing. Each such telephonic Borrowing Request shall be irrevocable and shall
be confirmed promptly by hand delivery or telecopy to the Administrative Agent
of a written Borrowing Request in a form approved by the Administrative Agent
and signed by Borrower. Each such telephonic and written Borrowing Request shall
specify the following information in compliance with Section 2.02:
(a) whether the requested Borrowing is to be a Revolving
Borrowing or a Swingline Loan;
(b) the aggregate amount of such Borrowing;
(c) the date of such Borrowing, which shall be a Business
Day;
(d) whether such Borrowing is to be an ABR Borrowing or a
Eurodollar Revolving Borrowing;
(e) in the case of a Eurodollar Revolving Borrowing, the
initial Interest Period to be applicable thereto, which shall be a
period contemplated by the definition of the term "Interest Period";
provided, that until the earlier of (i) the date on which the
Administrative Agent and the Collateral Agent shall have notified
Borrower that the primary syndication of the Commitments has been
completed and (ii) the date which is 180 days after the Closing Date,
the Interest Period shall be one month;
(f) the location and number of Borrower's account to
which funds are to be disbursed, which shall comply with the
requirements of Section 2.02; and
(g) that the conditions set forth in Section 4.02 (b)-(e)
are satisfied as of the date of the notice.
If no election as to the Type of Borrowing is specified, then the
requested Borrowing shall be an ABR Borrowing. If no Interest Period is
specified with respect to any requested Eurodollar Revolving Borrowing, then
Borrower shall be deemed to have selected an Interest Period of one month's
duration (subject to the proviso in clause (e) above). Promptly following
receipt of a Borrowing Request in accordance with this Section 2.03, the
Administrative Agent shall notify Collateral Agent of the borrowing Request,
confirm with Collateral Agent that the funding of such Borrowing Request is in
conformity with this Section 2.03 and advise each Lender of the details thereof
and of the amount of such Lender's Loan to be made as part of the requested
Borrowing.
SECTION 2.04 EVIDENCE OF DEBT; REPAYMENT OF LOANS. (a) Borrower hereby
unconditionally promises to pay (i) to the Administrative Agent for the account
of each Revolving Lender, the then unpaid principal amount of each Revolving
Loan of such Lender on the Maturity Date and (ii) to the Swingline Lender the
then unpaid principal amount of each Swingline Loan on the earlier of the
Maturity Date and the 10th day (or earlier, but, subject to application of funds
under Section 9.01(f), at least two Business Days) after such Swingline
49
Loan is made; provided, that on each date that a Revolving Borrowing is made,
Borrower shall repay all Swingline Loans that were outstanding on the date such
Borrowing was requested.
(b) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of Borrower to such Lender
resulting from each Loan made by such Lender from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time under this Agreement.
(c) The Administrative Agent shall maintain accounts in which it will
record (i) the amount of each Loan made hereunder, the Type and Class thereof
and the Interest Period applicable thereto; (ii) the amount of any principal or
interest due and payable or to become due and payable from Borrower to each
Lender hereunder; and (iii) the amount of any sum received by the Administrative
Agent hereunder for the account of the Lenders and each Lender's share thereof.
The Administrative Agent shall, from time to time, advise the Collateral Agent
of the status of such accounts to permit Collateral Agent to determine the
Borrowing Base.
(d) The entries made in the accounts maintained pursuant to paragraphs
(b) and (c) above shall be prima facie evidence of the existence and amounts of
the obligations therein recorded; provided, that the failure of any Lender or
the Administrative Agent to maintain such accounts or any error therein shall
not in any manner affect the obligations of Borrower to repay the Loans in
accordance with their terms.
(e) Any Lender may request that Loans of any Class made by it be
evidenced by a promissory note. In such event, Borrower shall prepare, execute
and deliver to such Lender a promissory note payable to the order of such Lender
(or, if requested by such Lender, to such Lender and its registered assigns) in
the form of Exhibit H-1 or H-2, as the case may be. Thereafter, the Loans
evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 11.04) be represented by one or
more promissory notes in such form payable to the order of the payee named
therein (or, if such promissory note is a registered note, to such payee and its
registered assigns).
(f) All funds in the Blocked Accounts (including the Concentration
Account) shall be applied to the Loans and other Obligations in accordance with
Section 9.01 hereof.
SECTION 2.05 FEES. (a) Commitment Fee. Borrower agrees to pay to the
Administrative Agent for the account of each Lender a commitment fee (a
"COMMITMENT FEE"), equal to the Applicable Fee per annum on the average daily
unused amount of each Commitment of such Lender during the period from and
including the Closing Date to but excluding the date on which such Commitment
terminates. Accrued Commitment Fees shall be payable in arrears on the last day
of March, June, September and December of each year and on the date on which the
Revolving Commitments terminate, commencing on the first such date to occur
after the date hereof. All Commitment Fees shall be computed on the basis of a
year of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day). For purposes of computing
Commitment Fees with respect to Revolving Commitments, a Revolving Commitment of
a Lender shall be deemed to be used to the extent of the outstanding Revolving
Loans and LC Exposure of such Lender (and the Swingline Exposure of such Lender
shall be disregarded for such purpose).
50
(b) Administrative Agent Fees; Collateral Agent Fees. Borrower agrees
to pay to the (i) the Administrative Agent, for its own account, the
administrative fees set forth in the Fee Letter or such other fees payable in
the amounts and at the times separately agreed upon between Borrower and the
Administrative Agent (the "ADMINISTRATIVE AGENT FEES") and (ii) (i) Collateral
Agent, for its own account, the collateral monitoring fee set forth in the Fee
Letter or such other fees payable in the amounts and at the times separately
agreed upon between Borrower and the Collateral Agent (the "COLLATERAL AGENT
FEES").
(c) LC and Fronting Fees. Borrower agrees to pay (i) to the
Administrative Agent for the account of each Revolving Lender a participation
fee ("LC PARTICIPATION FEE") with respect to its participations in Letters of
Credit, which shall accrue at a rate equal to the Applicable Margin from time to
time used to determine the interest rate on Eurodollar Revolving Loans pursuant
to Section 2.06 on the average daily amount of such Lender's LC Exposure
(excluding any portion thereof attributable to unreimbursed LC Disbursements)
during the period from and including the Closing Date to but excluding the later
of the date on which such Lender's Revolving Commitment terminates and the date
on which such Lender ceases to have any LC Exposure, and (ii) to the Issuing
Bank a fronting fee ("FRONTING FEE"), which shall accrue at the rate of 0.125%
per annum on the average daily amount of the LC Exposure (excluding any portion
thereof attributable to unreimbursed LC Disbursements) during the period from
and including the Closing Date to but excluding the later of the date of
termination of the Revolving Commitments and the date on which there ceases to
be any LC Exposure, as well as the Issuing Bank's standard fees with respect to
the issuance, amendment, renewal or extension of any Letter of Credit or
processing of drawings thereunder. LC Participation Fees and Fronting Fees
accrued through and including the last day of March, June, September and
December of each year shall be payable on the third Business Day following such
last day, commencing on the first such date to occur after the Closing Date;
provided, that all such fees shall be payable on the date on which the Revolving
Commitments terminate and any such fees accruing after the date on which the
Revolving Commitments terminate shall be payable on demand. Any other fees
payable to the Issuing Bank pursuant to this paragraph shall be payable within
10 days after demand. All LC Participation Fees and Fronting Fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).
Following the occurrence and during the continuance of an Event of Default, the
LC Participation Fee shall be increased to a per annum rate equal to 2% plus the
otherwise applicable rate with respect thereto.
(d) All Fees shall be paid on the dates due, in immediately available
funds, to the Administrative Agent for distribution, if and as appropriate,
among the Lenders, except that the Fronting Fees shall be paid directly to the
Issuing Bank. Once paid, none of the Fees shall be refundable under any
circumstances.
SECTION 2.06 INTEREST ON LOANS AND DEFAULT COMPENSATION. (a) Subject to
the provisions of Section 2.06(c), the Loans comprising each ABR Borrowing and
each Swingline Loan, shall bear interest at a rate per annum equal to the
Alternate Base Rate plus the Applicable Margin in effect from time to time.
(b) Subject to the provisions of Section 2.06(c), the Loans comprising
each Eurodollar Revolving Borrowing shall bear interest at a rate per annum
equal to the Adjusted LIBOR Rate
51
for the Interest Period in effect for such Borrowing plus the Applicable Margin
in effect from time to time.
(c) Notwithstanding the foregoing, following the occurrence and during
the continuance of an Event of Default, all Obligations shall, upon written
notice from the Administrative Agent, or at the election of the Required
Lenders, bear interest, after as well as before judgment, at a per annum rate
equal to (i) in the case of principal of any Loan, 2% plus the rate otherwise
applicable to such Loan as provided in the preceding paragraphs of this Section
2.06, (ii) LC Participation Fee shall increase as provided in Section 2.05(c),
and (iii) in the case of any other amount, 2% plus the rate applicable to ABR
Revolving Loans as provided in paragraph (a) of this Section 2.06.
(d) Accrued interest on each Loan shall be payable in arrears on each
Interest Payment Date for such Loan and upon termination of the Revolving
Commitments; provided, that (i) interest accrued pursuant to paragraph (c) of
this Section 2.06 shall be payable on demand (provided, that, absent demand,
such interest shall be payable on each Interest Payment Date and upon
termination of the Revolving Commitments), (ii) in the event of any repayment or
prepayment of any Loan (other than a prepayment of an ABR Revolving Loan prior
to the end of the Revolving Availability Period), accrued interest on the
principal amount repaid or prepaid shall be payable on the date of such
repayment or prepayment and (iii) in the event of any conversion of any
Eurodollar Revolving Loan prior to the end of the current Interest Period
therefor, accrued interest on such Loan shall be payable on the effective date
of such conversion.
(e) All interest hereunder shall be computed on the basis of a year of
360 days, except that interest computed by reference to the Alternate Base Rate
shall be computed on the basis of a year of 365 days (or 366 days in a leap
year), and in each case shall be payable for the actual number of days elapsed
(including the first day but excluding the last day). The applicable Alternate
Base Rate or Adjusted LIBOR Rate shall be determined by the Administrative Agent
in accordance with the provisions of this Agreement and such determination shall
be conclusive absent manifest error.
SECTION 2.07 TERMINATION AND REDUCTION OF COMMITMENTS. (a) The
Revolving Commitments, the Swingline Commitment, and the LC Commitment shall
automatically terminate on the Maturity Date.
(b) Borrower may at any time terminate, or from time to time
permanently reduce, the Commitments of any Class; provided, that (i) each
reduction of the Commitments of any Class shall be in an amount that is an
integral multiple of $1.0 million and not less than $5.0 million, (ii) the
Commitments shall not be reduced to an amount less than $175.0 million and (iii)
the Commitments shall not be terminated or reduced if, after giving effect to
any concurrent prepayment of the Loans in accordance with Section 2.10, the sum
of the Revolving Exposures would exceed the aggregate amount of Revolving
Commitments, the Swingline Exposures would exceed the Swingline Commitment or
the LC Exposures would exceed the LC Commitment.
(c) Borrower shall notify the Administrative Agent of any election to
terminate or reduce the Commitments under paragraph (b) of this Section 2.07 at
least three Business Days prior to the effective date of such termination or
reduction, specifying such election and the effective
52
date thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by
Borrower pursuant to this Section 2.07 shall be irrevocable. Any termination or
reduction of the Commitments of any Class shall be permanent. Each reduction of
the Commitments of any Class shall be made ratably among the Lenders in
accordance with their respective Commitments of such Class.
SECTION 2.08 INTEREST ELECTIONS. (a) Each Revolving Borrowing initially
shall be of the Type specified in the applicable Borrowing Request and, in the
case of a Eurodollar Revolving Borrowing, shall have an initial Interest Period
as specified in such Borrowing Request. Thereafter, Borrower may elect to
convert such Borrowing to a different Type or to continue such Borrowing and, in
the case of a Eurodollar Revolving Borrowing, may elect Interest Periods
therefor, all as provided in this Section 2.08. Borrower may elect different
options with respect to different portions of the affected Borrowing, in which
case each such portion shall be allocated ratably among the Lenders holding the
Loans comprising such Borrowing, and the Loans comprising each such portion
shall be considered a separate Borrowing. Notwithstanding anything to the
contrary, Borrower shall not be entitled to request any conversion or
continuation that, if made, would result in more than six Eurodollar Revolving
Borrowings outstanding hereunder at any one time. This Section 2.08 shall not
apply to Swingline Loans, which may not be converted or continued.
(b) To make an election pursuant to this Section 2.08, Borrower shall
notify the Administrative Agent of such election by telephone by the time that a
Borrowing Request would be required under Section 2.03 if Borrower was
requesting a Revolving Borrowing of the Type resulting from such election to be
made on the effective date of such election. Each such telephonic Interest
Election Request shall be irrevocable and shall be confirmed promptly by hand
delivery or telecopy to the Administrative Agent of a written Interest Election
Request substantially in the form of Exhibit D.
(c) Each telephonic and written Interest Election Request shall specify
the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request
applies and, if different options are being elected with respect to different
portions thereof, the portions thereof to be allocated to each resulting
Borrowing (in which case the information to be specified pursuant to clauses
(iii) and (iv) below shall be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to
such Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR
Borrowing or a Eurodollar Revolving Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Revolving
Borrowing, the Interest Period to be applicable thereto after giving effect to
such election, which shall be a period contemplated by the definition of the
term "Interest Period"; provided, that until the earlier of (i) the date on
which the Administrative Agent and the Collateral Agent shall have
53
notified Borrower that the primary syndication of the Commitments has been
completed and (ii) the date which is 180 days after the Closing Date, the
Interest Period shall be one month.
If any such Interest Election Request requests a Eurodollar Revolving Borrowing
but does not specify an Interest Period, then Borrower shall be deemed to have
selected an Interest Period of one month's duration (subject to the proviso in
clause (iv) above).
(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender's portion of each resulting Borrowing.
(e) If an Interest Election Request with respect to a Eurodollar
Revolving Borrowing is not timely delivered prior to the end of the Interest
Period applicable thereto, then, unless such Borrowing is repaid as provided
herein, at the end of such Interest Period such Borrowing shall be converted to
an ABR Borrowing. Notwithstanding any contrary provision hereof, if an Event of
Default has occurred and is continuing and the Administrative Agent, at the
request of the Required Lenders, so notifies Borrower, then, after the
occurrence and during the continuance of such Event of Default (i) no
outstanding Borrowing may be converted to or continued as a Eurodollar Revolving
Borrowing and (ii) unless repaid, each Eurodollar Revolving Borrowing shall be
converted to an ABR Borrowing at the end of the Interest Period applicable
thereto.
SECTION 2.09 [INTENTIONALLY OMITTED].
SECTION 2.10 OPTIONAL AND MANDATORY PREPAYMENTS OF LOANS.
(a) Optional Prepayments. In addition to prepayments of Borrowings in
accordance with Section 9.01 hereof, Borrower shall have the right at any time
and from time to time to prepay any Borrowing, in whole or in part, subject to
the requirements of this Section 2.10; provided, that each partial prepayment
shall be in an amount that is an integral multiple of $1.0 million and not less
than $5.0 million.
(b) Revolving Loan Prepayments.
(i) In the event of the termination of all the Revolving
Commitments, Borrower shall, on the date of such termination, repay or prepay
all its outstanding Revolving Borrowings and all outstanding Swingline Loans and
replace all outstanding Letters of Credit and/or deposit an amount equal to the
LC Exposure in the Cash Collateral Account.
(ii) In the event of any partial reduction of the
Revolving Commitments, then (A) at or prior to the effective date of such
reduction, the Administrative Agent shall notify Borrower and the Revolving
Lenders of the sum of the Revolving Exposures after giving effect thereto and
(B) if the sum of the Revolving Exposures would exceed the aggregate amount of
Revolving Commitments after giving effect to such reduction, then Borrower
shall, on the date of such reduction, first, repay or prepay all Swingline
Loans, second, repay or prepay Revolving Borrowings and third, replace or cash
collateralize outstanding Letters of Credit in accordance with the procedures
set forth in Section 2.18(j), in an amount sufficient to eliminate such excess.
54
(iii) In the event that Excess Availability is less than
$15.0 million, the Borrower shall, without notice or demand, immediately apply
an amount equal to such deficiency to prepay the Loans and any interest accrued
thereon, in accordance with this Section 2.10(b)(iii). The Borrower shall,
first, repay or prepay Revolving Borrowings and second, replace or cash
collateralize outstanding Letters of Credit in accordance with the procedures
set forth in Section 2.18(j), in an amount sufficient to restore such Excess
Availability. Notwithstanding the foregoing, any Overadvance made pursuant to
Section 10.10 shall be repaid only on demand in accordance with such Section.
(iv) In the event that the sum of all Lenders' Revolving
Exposures exceeds the Revolving Commitments then in effect (including, without
limitation, on any date on which Dollar Equivalents are determined pursuant to
Section 11.15), the Borrower shall, without notice or demand, immediately first,
repay or prepay Revolving Borrowings and, second, replace or cash collateralize
outstanding Letters of Credit in accordance with the procedures set forth in
Section 2.18(j), in an amount sufficient to eliminate such excess.
(v) In the event that the aggregate LC Exposure exceeds
the LC Commitment then in effect (including, without limitation, on any date on
which Dollar Equivalents are determined pursuant to Section 11.15), the Borrower
shall, without notice or demand, immediately replace or cash collateralize
outstanding Letters of Credit in accordance with the procedures set forth in
Section 2.18(j), in an amount sufficient to eliminate such excess.
(c) Asset Sales. Not later than one Business Day following the receipt
of any Net Cash Proceeds of any Asset Sale by a Loan Party, Borrower shall, and
shall cause the applicable Loan Party (with appropriate adjustments to any
intercompany loan account balances or Borrowing Base Guarantor Intercompany Loan
Account balances, as applicable) to, apply 100% of the Net Cash Proceeds
received with respect thereto to make prepayments in accordance with Section
2.10(i); provided, that:
(i) no such prepayment shall be required with respect to
(A) any Asset Sale permitted by Section 6.05(b)(ii), (e) or (h), (B) the
disposition of assets subject to a condemnation or eminent domain proceeding or
insurance settlement to the extent it does not constitute a Casualty Event, or
(C) Asset Sales for fair market value resulting in no more than $100,000 in Net
Cash Proceeds per Asset Sale (or series of related Asset Sales) and less than
$1.0 million in Net Cash Proceeds in any fiscal year; and
(ii) subject to Section 2.10(g) and so long as no Event of
Default shall then exist or would arise therefrom and the aggregate of such Net
Cash Proceeds of Asset Sales (except Asset Sales permitted under Section
6.05(b)(v)) shall not exceed $5.0 million in any fiscal year, such proceeds
shall not be required to be so applied on such date to the extent that Borrower
shall have delivered an Officers' Certificate to the Administrative Agent on or
prior to such date stating that such Net Cash Proceeds shall be used to purchase
replacement assets or acquire 100% of the Equity Interests of any Person that
owns such assets no later than 270 days following the date of such Asset Sale
(which Officers' Certificate shall set forth the estimates of the proceeds to be
so expended); provided, that all Property purchased with the Net Cash Proceeds
thereof (other than such Property purchased by a Foreign Subsidiary in
connection with a Foreign Permitted Asset Sale) pursuant to this subsection
shall be made subject to the Lien of
55
the applicable Security Documents in favor of the Collateral Agent, for its
benefit and for the benefit of the other Secured Parties in accordance with
Sections 5.11 and 5.12;
(d) Debt Issuance. Upon any Debt Issuance after the Closing Date (other
than Acquisition Debt Issuance), Borrower shall, and shall cause the other Loan
Parties to, make prepayments in accordance with Sections 2.10(i) in an aggregate
principal amount equal to 100% of the Net Cash Proceeds of such Debt Issuance.
(e) [Intentionally Omitted].
(f) Casualty Events. Not later than one Business Day following the
receipt of any Net Cash Proceeds from a Casualty Event, Borrower shall apply,
and shall cause other Loan Parties (with appropriate adjustments to any
intercompany loan account balances or Borrowing Base Guarantor Intercompany Loan
Account balances, as applicable) to apply, an amount equal to 100% of such Net
Cash Proceeds to make prepayments in accordance with Sections 2.10(i); provided,
that subject to Section 2.10(g) and so long as no Event of Default shall then
exist or arise therefrom, such proceeds shall not be required to be so applied
on such date to the extent that in the event such Net Cash Proceeds shall not
exceed $5.0 million in the aggregate at any time, Borrower shall have delivered
an Officers' Certificate (which Officers' Certificate shall set forth the
estimates of the proceeds to be so expended) to the Administrative Agent and the
Collateral Agent on or prior to such date stating that such proceeds shall be
used to repair, replace or restore any Property that is subject of a Casualty
Event no later than 270 days following the date of receipt of such proceeds;
provided, further, that all Property purchased with the Net Cash Proceeds
thereof pursuant to this subsection shall be made subject to the Lien of the
applicable Security Documents in favor of the Collateral Agent, for its benefit
and for the benefit of the other Secured Parties in accordance with Sections
5.11 and 5.12.
(g) In the event that Borrower has delivered an Officers' Certificate
in accordance with Section 2.10(c)(ii) or in accordance with Section 2.10(f),
(i) both a Reserve and a Line Reserve ("REINVESTMENT RESERVE") shall be
established (in the amount of the Net Cash Proceeds less, in the case of a
Casualty Event, the Net Cash Proceeds attributable to lost or destroyed
Inventory) which shall each be released simultaneously with and to the extent of
any Loans advanced to the Borrower for the purpose of purchasing assets in
accordance with Section 2.10(c)(ii) or 2.10(f), as applicable; provided, that
Borrower submits (with the applicable Borrowing Request) an Officer's
Certificate setting forth the use of proceeds of the requested Loan and
confirming that such use is in compliance with Section 2.10(c)(ii) or 2.10(f),
as applicable, and (ii) in the event that any part or all of the Reinvestment
Reserve remains in place at the end of the time period set forth in Section
2.10(c)(ii) or 2.10(f), as applicable:
(A) Borrower shall, and shall cause other Loan Parties to
(with appropriate adjustments to any intercompany loan account balances
or Borrowing Base Guarantor Intercompany Loan Account balances, as
applicable) prepay Obligations in accordance (with a concurrent release
of such Reinvestment Reserve) with Section 2.10(i) in the amount of
such remaining Reinvestment Reserve without reducing Commitments, and
(B) if such Reinvestment Reserve relates to Eligible
Equipment or Eligible Real Property, (x) such Eligible Equipment or
Eligible Real Property shall be deleted
56
from Schedule 1.01(d) and Schedule 1.01(d) shall be amended in
accordance with the definition of the term "Fixed Asset Loan Value"
(with appropriate adjustments to the Borrowing Base Guarantor
Intercompany Loan Account), and (y) the Fixed Asset Loan Value of the
Person owning such Eligible Equipment or Eligible Real Property shall
be reduced by an amount equal to the appraised net orderly liquidation
value of Eligible Equipment or the appraised fair market value of
Eligible Real Property, as applicable.
For the purposes of determining whether clause (B) of this paragraph
(g) shall apply, any Equipment located on one of the locations listed on
Schedule 1.01(e) shall be deemed Eligible Equipment and therefore clause (B) of
this paragraph (g) shall apply with respect to such Equipment and the amount of
the Net Cash Proceeds of such Equipment shall be deemed to be the appraised net
orderly liquidation value thereof.
(h) [Intentionally Omitted.]
(i) Application of Prepayments.
(i) Prior to any optional or mandatory prepayment of
Borrowings hereunder, Borrower shall select the Borrowing or Borrowings to be
prepaid and shall specify such selection in the notice of such prepayment
pursuant to paragraph (i) of this Section 2.10(i). Subject to Section 9.04 and
so long as no Event of Default shall then exist and be continuing, all mandatory
prepayments shall be applied as follows: first, to Fees and reimbursable
expenses of the Administrative Agent and the Collateral Agent then due and
payable pursuant to the Loan Documents; second, to interest then due and payable
on all Loans; third, to the principal balance of the Swingline Loan until the
same has been repaid in full; fourth, to the outstanding principal balance of
Revolving Loans until the same has been paid in full, including accompanying
accrued interest and charges under Sections 2.12, 2.13 and 2.15 (Borrower may
elect which of any Eurodollar Revolving Borrowings is to be prepaid); fifth, to
cash collateralize all LC Exposures plus any accrued and unpaid Fees with
respect thereto (to be held and applied in accordance with Section 2.18(i)
hereof); sixth, to all other Obligations pro rata in accordance with the amounts
that such Lender certifies is outstanding; and, seventh, returned to Borrower or
to such party as otherwise required by law. All such mandatory prepayments of
the Revolving Loans shall cause a corresponding reduction in the Revolving
Commitments of the Lenders in accordance with their applicable Revolving
Commitments.
(ii) Amounts to be applied pursuant to this Section 2.10
to the prepayment of Revolving Loans shall be applied, as applicable, first to
reduce outstanding ABR Revolving Loans, respectively. Any amounts remaining
after each such application shall be applied to prepay Eurodollar Revolving
Loans, as applicable. Notwithstanding the foregoing, if the amount of any
prepayment of Loans required under this Section 2.10 shall be in excess of the
amount of the ABR Loans at the time outstanding, only the portion of the amount
of such prepayment as is equal to the amount of such outstanding ABR Loans shall
be immediately prepaid and, at the election of Borrower, the balance of such
required prepayment shall be prepaid immediately, together with any amounts
owing to the Lenders under Section 2.13.
(j) Notice of Prepayment. Borrower shall notify the Administrative
Agent (and, in the case of prepayment of a Swingline Loan, the Swingline Lender)
by telephone (confirmed by
57
telecopy) of any prepayment hereunder (i) in the case of prepayment of a
Eurodollar Revolving Borrowing, not later than 11:00 a.m., New York City time,
three Business Days before the date of prepayment, (ii) in the case of
prepayment of an ABR Borrowing, not later than 11:00 a.m., New York City time,
one Business Day before the date of prepayment or (iii) in the case of
prepayment of a Swingline Loan, not later than 11:00 a.m., New York City time,
on the date of prepayment. Each such notice shall be irrevocable and shall
specify the prepayment date, the principal amount of each Borrowing or portion
thereof to be prepaid and, in the case of a mandatory prepayment, a reasonably
detailed calculation of the amount of such prepayment. Promptly following
receipt of any such notice (other than a notice relating solely to Swingline
Loans), the Administrative Agent shall advise the Lenders of the contents
thereof. Each partial prepayment of any Borrowing shall be in an amount that
would be permitted in the case of an advance of a Borrowing of the same Type as
provided in Section 2.02, except as necessary to apply fully the required amount
of a mandatory prepayment. Each prepayment of a Borrowing shall be applied
ratably to the Loans included in the prepaid Borrowing. Prepayments shall be
accompanied by accrued interest to the extent required by Section 2.06.
SECTION 2.11 ALTERNATE RATE OF INTEREST. If prior to the commencement
of any Interest Period for a Eurodollar Revolving Borrowing:
(a) the Administrative Agent determines (which determination shall be
conclusive absent manifest error) that adequate and reasonable means do not
exist for ascertaining the Adjusted LIBOR Rate for such Interest Period; or
(b) the Administrative Agent is advised by the Required Lenders that
the Adjusted LIBOR Rate for such Interest Period will not adequately and fairly
reflect the cost to such Lenders of making or maintaining their Loans included
in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to Borrower and the
Lenders by telephone, e-mail or telecopy as promptly as practicable thereafter
and, until the Administrative Agent notifies Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Revolving Borrowing shall be
ineffective and (ii) if any Borrowing Request requests a Eurodollar Revolving
Borrowing, such Borrowing shall be made as an ABR Borrowing.
SECTION 2.12 INCREASED COSTS. (a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve,
special deposit or similar requirement against assets of, deposits with or for
the account of, or credit extended by, any Lender (except any such reserve
requirement reflected in the Adjusted LIBOR Rate) or the Issuing Bank; or
(ii) impose on any Lender or the Issuing Bank or the
London interbank market any other condition affecting this Agreement or
Eurodollar Revolving Loans made by such Lender or any Letter of Credit or
participation therein;
58
and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Revolving Loan (or of maintaining
its obligation to make any such Loan) or to increase the cost to such Lender or
the Issuing Bank of participating in, issuing or maintaining any Letter of
Credit or to reduce the amount of any sum received or receivable by such Lender
or the Issuing Bank hereunder (whether of principal, interest or otherwise),
then Borrower will pay to Administrative Agent for the account of such Lender or
the Issuing Bank, as the case may be, such additional amount or amounts as will
compensate such Lender or the Issuing Bank, as the case may be, for such
additional costs incurred or reduction suffered.
(b) If any Lender or the Issuing Bank determines that any Change in Law
regarding capital requirements has or would have the effect of reducing the rate
of return on such Lender's or the Issuing Bank's capital or on the capital of
such Lender's or the Issuing Bank's holding company, if any, as a consequence of
this Agreement or the Loans made by, or participations in Letters of Credit held
by, such Lender, or the Letters of Credit issued by the Issuing Bank, to a level
below that which such Lender or the Issuing Bank or such Lender's or the Issuing
Bank's holding company could have achieved but for such Change in Law (taking
into consideration such Lender's or the Issuing Bank's policies and the policies
of such Lender's or the Issuing Bank's holding company with respect to capital
adequacy), then from time to time Borrower will pay to such Lender or the
Issuing Bank, as the case may be, such additional amount or amounts as will
compensate such Lender or the Issuing Bank or such Lender's or the Issuing
Bank's holding company for any such reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting forth the
amount or amounts necessary to compensate such Lender or the Issuing Bank or its
holding company, as the case may be, as specified in paragraph (a) or (b) of
this Section 2.12 shall be delivered to Borrower and shall be conclusive absent
manifest error. Borrower shall pay Administrative Agent for the account of such
Lender or the Issuing Bank, as the case may be, the amount shown as due on any
such certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender or the Issuing Bank to
demand compensation pursuant to this Section 2.12 shall not constitute a waiver
of such Lender's or the Issuing Bank's right to demand such compensation;
provided, that Borrower shall not be required to compensate a Lender or the
Issuing Bank pursuant to this Section 2.12 for any increased costs or reductions
incurred more than 270 days prior to the date that such Lender or the Issuing
Bank, as the case may be, notifies Borrower of the Change in Law giving rise to
such increased costs or reductions and of such Lender's or the Issuing Bank's
intention to claim compensation therefor; provided, further that, if the Change
in Law giving rise to such increased costs or reductions is retroactive, then
the 270-day period referred to above shall not begin earlier than the date of
effectiveness of the Change in Law.
SECTION 2.13 BREAKAGE PAYMENTS. In the event of (a) the payment or
prepayment, whether optional or mandatory, of any principal of any Eurodollar
Revolving Loan other than on the last day of an Interest Period applicable
thereto (including as a result of an Event of Default), (b) the conversion of
any Eurodollar Revolving Loan other than on the last day of the Interest Period
applicable thereto, (c) the failure to borrow, convert, continue or prepay any
Revolving Loan on the date specified in any notice delivered pursuant hereto or
(d) the assignment of any Eurodollar Revolving Loan other than on the last day
of the Interest Period applicable thereto as
59
a result of a request by Borrower pursuant to Section 2.16, then, in any such
event, Borrower shall compensate each Lender for the loss, cost and expense
attributable to such event. In the case of a Eurodollar Revolving Loan, such
loss, cost or expense to any Lender shall be deemed to include an amount
determined by such Lender to be the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount of such Loan had such
event not occurred, at the Adjusted LIBOR Rate that would have been applicable
to such Loan, for the period from the date of such event to the last day of the
then current Interest Period therefor (or, in the case of a failure to borrow,
convert or continue, for the period that would have been the Interest Period for
such Loan), over (ii) the amount of interest which would accrue on such
principal amount for such period at the interest rate which such Lender would
bid were it to bid, at the commencement of such period, for Dollar deposits of a
comparable amount and period from other banks in the Eurodollar market. A
certificate of any Lender setting forth any amount or amounts that such Lender
is entitled to receive pursuant to this Section 2.13 shall be delivered to
Borrower and Administrative Agent and shall be conclusive absent manifest error.
Borrower shall pay Administrative Agent for the account of such Lender the
amount shown as due on any such certificate within 10 days after receipt
thereof.
SECTION 2.14 PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING OF
SET-OFFs. (a) Borrower shall make each payment required to be made by it
hereunder or under any other Loan Document (whether of principal, interest, fees
or reimbursement of LC Disbursements, or of amounts payable under Section 2.12,
2.13 or 2.15, or otherwise) on or before the time expressly required hereunder
or under such other Loan Document for such payment (or, if no such time is
expressly required, prior to 2:00 p.m., New York City time), on the date when
due, in immediately available funds, without setoff or counterclaim. Any amounts
received after such time on any date may, in the discretion of the
Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments
shall be made to the Administrative Agent at its offices at 000 Xxxxxxxxxx
Xxxxxxxxx, Xxxxxxxx, Xxxxxxxxxxx, except payments to be made directly to the
Issuing Bank or Swingline Lender as expressly provided herein and except that
payments pursuant to Sections 2.12, 2.13, 2.15 and 11.03 shall be made to the
Administrative Agent for the benefit of to the Persons entitled thereto and
payments pursuant to other Loan Documents shall be made to the Administrative
Agent for the benefit of the Persons specified therein. The Administrative Agent
shall distribute any such payments received by it for the account of any other
Person to the appropriate recipient promptly following receipt thereof. If any
payment under any Loan Document shall be due on a day that is not a Business
Day, the date for payment shall be extended to the next succeeding Business Day,
and, in the case of any payment accruing interest, interest thereon shall be
payable for the period of such extension. All payments under each Loan Document
shall be made in Dollars.
(b) If at any time insufficient funds are received by and available to
the Administrative Agent to pay fully all amounts of principal, unreimbursed LC
Disbursements, interest and fees then due hereunder, such funds shall be applied
(i) first, towards payment of interest and fees then due hereunder, ratably
among the parties entitled thereto in accordance with the amounts of interest
and fees then due to such parties, and (ii) second, towards payment of principal
and unreimbursed LC Disbursements then due hereunder, ratably among the parties
entitled thereto in accordance with the amounts of principal and unreimbursed LC
Disbursements then due to such parties.
60
(c) If any Lender shall, by exercising any right of setoff or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Revolving Loans or participations in LC Disbursements or
Swingline Loans resulting in such Lender receiving payment of a greater
proportion of the aggregate amount of its Revolving Loans and participations in
LC Disbursements and Swingline Loans and accrued interest thereon than the
proportion received by any other Lender, then the Lender receiving such greater
proportion shall purchase (for cash at face value) participations in the
Revolving Loans and participations in LC Disbursements and Swingline Loans of
other Lenders to the extent necessary so that the benefit of all such payments
shall be shared by the Lenders ratably in accordance with the aggregate amount
of principal of and accrued interest on their respective Revolving Loans and
participations in LC Disbursements and Swingline Loans; provided, that (i) if
any such participations are purchased and all or any portion of the payment
giving rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, without interest, and
(ii) the provisions of this paragraph shall not be construed to apply to any
payment made by Borrower pursuant to and in accordance with the express terms of
this Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations
in LC Disbursements to any assignee or participant, other than to Borrower or
any Subsidiary or Affiliate thereof (as to which the provisions of this
paragraph shall apply). Borrower consents to the foregoing and agrees, to the
extent it may effectively do so under applicable law, that any Lender acquiring
a participation pursuant to the foregoing arrangements may exercise against
Borrower rights of setoff and counterclaim with respect to such participation as
fully as if such Lender were a direct creditor of Borrower in the amount of such
participation.
(d) Unless the Administrative Agent shall have received notice from
Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders or the Issuing Bank hereunder that Borrower
will not make such payment, the Administrative Agent may assume that Borrower
has made such payment on such date in accordance herewith and may, in reliance
upon such assumption, distribute to the Lenders or the Issuing Bank, as the case
may be, the amount due. In such event, if Borrower has not in fact made such
payment, then each of the Lenders or the Issuing Bank, as the case may be,
severally agrees to repay to the Administrative Agent forthwith on demand the
amount so distributed to such Lender or Issuing Bank with interest thereon, for
each day from and including the date such amount is distributed to it to but
excluding the date of payment to the Administrative Agent, at the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to be made by
it pursuant to Section 2.02(c), 2.02(f), 2.14(d), 2.17(d), 2.18(d) or 11.03(d),
then the Administrative Agent may, in its discretion (notwithstanding any
contrary provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender's
obligations under such Sections until all such unsatisfied obligations are fully
paid.
SECTION 2.15 TAXES. (a) Any and all payments by or on account of any
obligation of Borrower or any Borrowing Base Guarantor hereunder or under any
other Loan Document shall be made without set-off, counterclaim or other defense
and free and clear of and without deduction or withholding for any and all
Indemnified Taxes; provided, that if Borrower or such
61
Borrowing Base Guarantor shall be required by law to deduct any Indemnified
Taxes from such payments, then (i) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions or
withholdings applicable to additional sums payable under this Section 2.15) the
Administrative Agent, Lender or Issuing Bank (as the case may be) receives an
amount equal to the sum it would have received had no such deductions or
withholdings been made, (ii) Borrower or such Borrowing Base Guarantor shall
make such deductions or withholdings and (iii) Borrower or such Borrowing Base
Guarantor shall pay the full amount deducted or withheld to the relevant
Governmental Authority in accordance with applicable law.
(b) In addition, Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.
(c) Borrower shall indemnify and pay the Administrative Agent, each
Lender and the Issuing Bank, within 10 Business Days after written demand
therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by
the Administrative Agent, such Lender or the Issuing Bank, as the case may be,
on or with respect to any payment by or on account of any obligation of Borrower
hereunder or under any other Loan Document (including Indemnified Taxes or Other
Taxes imposed or asserted on or attributable to amounts payable under this
Section 2.15) and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or
liability delivered to Borrower by a Lender or the Issuing Bank, or by the
Administrative Agent on its own behalf or on behalf of a Lender or the Issuing
Bank, shall be conclusive absent manifest error.
(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by Borrower to a Governmental Authority, Borrower shall deliver to
the Administrative Agent the original or a certified copy of a receipt issued by
such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory
to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which Borrower
is located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law, such
properly completed and executed documentation prescribed by applicable law or
reasonably requested by Borrower as will permit such payments to be made without
withholding or at a reduced rate. Each Foreign Lender either (1) (i) agrees to
furnish either U.S. Internal Revenue Service Form W-8ECI or U.S. Internal
Revenue Service Form W-8BEN (or successor form) and (ii) agrees (for the benefit
of Borrower and the Administrative Agent), to the extent it may lawfully do so
at such times, upon reasonable request by Borrower or the Administrative Agent,
to provide a new Form W-8ECI or Form W-8BEN (or successor form) upon the
expiration or obsolescence of any previously delivered form to reconfirm any
complete exemption from, or any entitlement to a reduction in, U.S. federal
withholding tax with respect to any interest payment hereunder or (2) in the
case of any such Foreign Lender that is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Code, (i) agrees to furnish either (a) a "Non-Bank
62
Certificate" in a form acceptable to the Administrative Agent and the Borrower
and two accurate and complete original signed copies of Internal Revenue Service
Form W-8BEN (or successor form) or (b) an Internal Revenue Form W-8ECI (or
successor form), certifying (in each case) to such Foreign Lender's legal
entitlement to an exemption or reduction from U.S. federal withholding tax with
respect to all interest payments hereunder and (ii) agrees (for the benefit of
Borrower and the Administrative Agent) to the extent it may lawfully do so at
such times, upon reasonable request by Borrower or the Administrative Agent, to
provide a new Form W-8BEN or W-8ECI (or successor form) upon the expiration or
obsolescence of any previously delivered form to reconfirm any complete
exemption from, or any entitlement to a reduction in, U.S. federal withholding
tax with respect to any interest payment hereunder.
(f) If the Administrative Agent or a Lender (or an assignee) determines
in its reasonable discretion that it has received a refund of any Indemnified
Taxes or Other Taxes as to which it has been indemnified by Borrower or with
respect to which Borrower has paid additional amounts pursuant to this Section
2.15, it shall pay over such refund to Borrower (but only to the extent of
indemnity payments made, or additional amounts paid, by Borrower under this
Section 2.15 with respect to the Indemnified Taxes or the Other Taxes giving
rise to such refund), net of all out-of-pocket expenses of the Administrative
Agent or such Lender (or assignee) and without interest (other than any interest
paid by the relevant Governmental Authority with respect to such refund);
provided, however, that Borrower, upon the request of the Administrative Agent
or such Lender (or assignee), agrees to repay the amount paid over to Borrower
(plus any penalties, interest or other charges imposed by the relevant
Governmental Authority) to the Administrative Agent or such Lender (or assignee)
in the event the Administrative Agent or such Lender (or assignee) is required
to repay such refund to such Governmental Authority. Nothing contained in this
Section 2.15(f) shall require the Administrative Agent or any Lender (or
assignee) to make available its tax returns or any other information which it
deems confidential to Borrower or any other Person. Notwithstanding anything to
the contrary, in no event will any Lender be required to pay any amount to
Borrower the payment of which would place such Lender in a less favorable net
after-tax position than such Lender would have been in had the additional
amounts giving rise to such refund of any Indemnified Taxes or Other Taxes never
been paid in the first place.
SECTION 2.16 MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS. (a)
Mitigation of Obligations. If any Lender requests compensation under Section
2.12, or if Borrower is required to pay any additional amount to any Lender or
any Governmental Authority for the account of any Lender pursuant to Section
2.15, then such Lender shall use reasonable efforts to designate a different
lending office for funding or booking its Loans hereunder or to assign its
rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the reasonable judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to Section
2.12 or 2.15, as the case may be, in the future and (ii) would not subject such
Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender. Borrower hereby agrees to pay all reasonable
costs and expenses incurred by any Lender in connection with any such
designation or assignment.
(b) Replacement of Lenders. If any Lender requests compensation under
Section 2.12, or if Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 2.15, or if any Lender defaults in its
63
obligation to fund Loans hereunder, then Borrower may, at its sole expense and
effort, upon notice to such Lender and the Administrative Agent, require such
Lender to assign and delegate, without recourse (in accordance with and subject
to the restrictions contained in Section 11.04), all of its interests, rights
and obligations under this Agreement to an assignee selected by Borrower that
shall assume such obligations (which assignee may be another Lender, if a Lender
accepts such assignment); provided, that (i) Borrower shall have received the
prior written consent of the Administrative Agent and the Collateral Agent (and,
if a Revolving Commitment is being assigned, the Issuing Bank and Swingline
Lender), which consent shall not unreasonably be withheld, (ii) such Lender
shall have received payment of an amount equal to the outstanding principal of
its Loans and participations in LC Disbursements and Swingline Loans, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder,
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or Borrower (in the case of all other amounts) and (iii) in
the case of any such assignment resulting from a claim for compensation under
Section 2.12 or payments required to be made pursuant to Section 2.15, such
assignment will result in a material reduction in such compensation or payments.
A Lender shall not be required to make any such assignment and delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling Borrower to require such assignment and delegation cease
to apply.
SECTION 2.17 SWINGLINE LOANS. (a) Swingline Commitment. Subject to the
terms and conditions set forth herein, the Swingline Lender agrees to make
Swingline Loans to Borrower from time to time during the Revolving Availability
Period, in an aggregate principal amount at any time outstanding that will not
result in (i) the aggregate principal amount of outstanding Swingline Loans
exceeding $10.0 million or (ii) the sum of the total Revolving Exposures
exceeding the lesser of (A) the total Revolving Commitments minus any
Reinvestment Reserve and (B) the Borrowing Base then in effect; provided, that
the Swingline Lender shall not be required to make a Swingline Loan to refinance
an outstanding Swingline Loan. Within the foregoing limits and subject to the
terms and conditions set forth herein, Borrower may borrow, repay and reborrow
Swingline Loans.
(b) Swingline Loans. To request a Swingline Loan, Borrower shall notify
the Administrative Agent of such request by telephone (confirmed by telecopy),
not later than 2:00 p.m., New York City time, on the day of a proposed Swingline
Loan. Each such notice shall be irrevocable and shall specify the requested date
(which shall be a Business Day) and amount of the requested Swingline Loan. The
Administrative Agent will promptly advise the Swingline Lender of any such
notice received from Borrower. The Swingline Lender shall make each Swingline
Loan available to Borrower by means of a credit to the general deposit account
of Borrower with the Swingline Lender (or, in the case of a Swingline Loan made
to finance the reimbursement of an LC Disbursement as provided in Section
2.18(e), by remittance to the Issuing Bank) by 3:00 p.m., New York City time, on
the requested date of such Swingline Loan. Borrower shall not request a
Swingline Loan if at the time of and immediately after giving effect to such
request a Default has occurred and is continuing. Swingline Loans shall be made
in minimum amounts of $500,000 and integral multiples of $100,000 above such
amount.
(c) Prepayment. Borrower shall have the right at any time and from time
to time to repay any Swingline Loan, in whole or in part, upon giving written or
telecopy notice (or telephone notice promptly confirmed by written, or telecopy
notice) to the Swingline Lender and to the
64
Administrative Agent before 12:00 (noon), New York City time on the date of
repayment at the Swingline Lender's address for notices specified in the
Swingline Lender's Administrative Questionnaire. All principal payments of
Swingline Loans shall be accompanied by accrued interest on the principal amount
being repaid to the date of payment.
(d) Participations. The Swingline Lender may by written notice given to
the Administrative Agent not later than 12:00 (noon), New York City time, on any
Business Day require the Revolving Lenders to acquire participations on such
Business Day in all or a portion of the Swingline Loans outstanding. Such notice
shall specify the aggregate amount of Swingline Loans in which Revolving Lenders
will participate. Promptly upon receipt of such notice, the Administrative Agent
will give notice thereof to each Revolving Lender, specifying in such notice
such Lender's Pro Rata Percentage of such Swingline Loan or Loans. Each
Revolving Lender hereby absolutely and unconditionally agrees, upon receipt of
notice as provided above, to pay to the Administrative Agent, for the account of
the Swingline Lender, such Lender's Pro Rata Percentage of such Swingline Loan
or Loans. Each Revolving Lender acknowledges and agrees that its obligation to
acquire participations in Swingline Loans pursuant to this paragraph is absolute
and unconditional and shall not be affected by any circumstance whatsoever,
including the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever (provided, that such
payment shall not cause such Lender's Revolving Exposure to exceed such Lender's
Revolving Commitment). Each Revolving Lender shall comply with its obligation
under this paragraph by wire transfer of immediately available funds, in the
same manner as provided in Section 2.02(f) with respect to Loans made by such
Lender (and Section 2.02 shall apply, mutatis mutandis, to the payment
obligations of the Revolving Lenders), and the Administrative Agent shall
promptly pay to the Swingline Lender the amounts so received by it from the
Revolving Lenders. The Administrative Agent shall notify Borrower of any
participations in any Swingline Loan acquired pursuant to this paragraph, and
thereafter payments in respect of such Swingline Loan shall be made to the
Administrative Agent and not to the Swingline Lender. Any amounts received by
the Swingline Lender from Borrower (or other party on behalf of Borrower) in
respect of a Swingline Loan after receipt by the Swingline Lender of the
proceeds of a sale of participations therein shall be promptly remitted to the
Administrative Agent; any such amounts received by the Administrative Agent
shall be promptly remitted by the Administrative Agent to the Revolving Lenders
that shall have made their payments pursuant to this paragraph and to the
Swingline Lender, as their interests may appear. The purchase of participations
in a Swingline Loan pursuant to this paragraph shall not relieve Borrower of any
default in the payment thereof.
SECTION 2.18 LETTERS OF CREDIT. (a) General. Subject to the terms and
conditions set forth herein, Borrower may request the issuance of Letters of
Credit for Borrower's account or the account of any Borrowing Base Guarantor in
a form reasonably acceptable to the Administrative Agent and the Issuing Bank,
at any time and from time to time during the Revolving Availability Period
(provided, that Borrower shall be a co-applicant with respect to each Letter of
Credit issued for the account of or in favor of any Borrowing Base Guarantor).
In the event of any inconsistency between the terms and conditions of this
Agreement and the terms and conditions of any form of letter of credit
application or other agreement submitted by Borrower to, or entered into by
Borrower with, the Issuing Bank relating to any Letter of Credit, the terms and
conditions of this Agreement shall control. Issuing Bank may consent to issuing
65
Letters of Credit that have automatic extension or renewal provisions
("evergreen" Letters of Credit) in its sole discretion, which evergreen Letters
of Credit Issuing Bank may, in its sole discretion, elect not to permit to be
extended or renewed at any time. If, as of the date which is 60 days prior to
the Maturity Date, any evergreen Letters of Credit may for any reason remain
outstanding and partially or wholly undrawn, Borrower shall immediately deposit
in the Cash Collateral Account, in the name of the Collateral Agent and for the
benefit of the Secured Parties, an amount in cash representing 105% of the
aggregate maximum amount then available to be drawn under such Letter of Credit
in accordance with Section 9.04 hereof.
(b) Request for Issuance, Amendment, Renewal, Extension; Certain
Conditions. To request the issuance of a Letter of Credit or the amendment,
renewal or extension of an outstanding Letter of Credit, Borrower shall hand
deliver or telecopy (or transmit by electronic communication, if arrangements
for doing so have been approved by the Issuing Bank) an LC Request to the
Issuing Bank and the Administrative Agent not later than 11:00 a.m. on the third
Business Day preceding the requested date of issuance, amendment, renewal or
extension (or such later date and time as is acceptable to the Issuing Bank). A
request for an initial issuance of a Letter of Credit shall specify in form and
detail satisfactory to the Issuing Bank: (i) the proposed issuance date of the
requested Letter of Credit (which shall be a Business Day); (ii) the amount
thereof; (iii) the expiry date thereof; (iv) the name and address of the
beneficiary thereof; (v) the documents to be presented by such beneficiary in
case of any drawing thereunder; (vi) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder; and (vii) such
other matters as the Issuing Bank may require. A request for an amendment,
renewal or extension of any outstanding Letter of Credit shall specify in form
and detail satisfactory to the Issuing Bank (i) the Letter of Credit to be
amended, renewed or extended; (ii) the proposed date of amendment, renewal or
extension thereof (which shall be a Business Day); (iii) the nature of the
proposed amendment, renewal or extension; and (iv) such other matters as the
Issuing Bank may require. If requested by the Issuing Bank, Borrower also shall
submit a letter of credit application on the Issuing Bank's standard form in
connection with any request for a Letter of Credit. A Letter of Credit shall be
issued, amended, renewed or extended only if (and upon issuance, amendment,
renewal or extension of each Letter of Credit Borrower shall be deemed to
represent and warrant that), after giving effect to such issuance, amendment,
renewal or extension (i) the LC Exposure shall not exceed $50.0 million and (ii)
the total Revolving Exposures shall not exceed the lesser of (A) the total
Revolving Commitments minus the Line Reserve and (B) the Borrowing Base then in
effect. Unless the Issuing Bank shall agree otherwise, no Letter of Credit shall
be in an initial amount less than $100,000, in the case of a Commercial Letter
of Credit, or $500,000, in the case of a Standby Letter of Credit.
(c) Expiration Date. Each Letter of Credit shall expire at or prior to
the close of business on the earlier of (i) in the case of a Standby Letter of
Credit, (x) the date which is one year after the date of the issuance of such
Standby Letter of Credit (or, in the case of any renewal or extension thereof,
one year after such renewal or extension) and (y) the Letter of Credit
Expiration Date and (ii) in the case of a Commercial Letter of Credit, (x) the
date that is 180 days after the date of issuance of such Commercial Letter of
Credit (or, in the case of any renewal or extension thereof, 180 days after such
renewal or extension) and (y) the Letter of Credit Expiration Date.
66
(d) Participations. By the issuance of a Letter of Credit (or an
amendment to a Letter of Credit increasing the amount thereof) and without any
further action on the part of the Issuing Bank or the Lenders, the Issuing Bank
hereby grants to each Revolving Lender, and each Revolving Lender hereby
acquires from the Issuing Bank, a participation in such Letter of Credit equal
to such Lender's Pro Rata Percentage of the aggregate amount available to be
drawn under such Letter of Credit. In consideration and in furtherance of the
foregoing, each Revolving Lender hereby absolutely and unconditionally agrees to
pay to the Administrative Agent, for the account of the Issuing Bank, such
Lender's Pro Rata Percentage of each LC Disbursement made by the Issuing Bank
and not reimbursed by Borrower on the date due as provided in paragraph (e) of
this Section 2.18, or of any reimbursement payment required to be refunded to
Borrower for any reason. Each Lender acknowledges and agrees that its obligation
to acquire participations pursuant to this paragraph in respect of Letters of
Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any
Letter of Credit or the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever.
(e) Reimbursement. If the Issuing Bank shall make any LC Disbursement
in respect of a Letter of Credit, Borrower shall reimburse such LC Disbursement
by paying to the Issuing Bank an amount equal to such LC Disbursement not later
than 2:00 p.m., New York City time, on the date that such LC Disbursement is
made, if Borrower shall have received notice of such LC Disbursement prior to
11:00 a.m., New York City time, on such date, or, if such notice has not been
received by Borrower prior to such time, on such date, then not later than 2:00
p.m., New York City time on (i) the Business Day that Borrower receives such
notice, if such notice is received prior to 11:00 a.m., New York City time, on
the day of receipt, or (ii) the Business Day immediately following the day that
Borrower receives such notice, if such notice is not received prior to such time
on the day of receipt; provided, that Borrower may, subject to the conditions to
borrowing set forth herein, request in accordance with Section 2.03 or 2.17 that
such payment be financed with an ABR Revolving Borrowing or Swingline Loan in an
equivalent amount and, to the extent so financed, Borrower's obligation to make
such payment shall be discharged and replaced by the resulting ABR Revolving
Borrowing or Swingline Loan. If Borrower fails to make such payment when due,
the Issuing Bank shall notify the Administrative Agent and the Administrative
Agent shall notify each Revolving Lender of the applicable LC Disbursement, the
payment then due from Borrower in respect thereof and such Lender's Pro Rata
Percentage thereof. Promptly following receipt of such notice, each Revolving
Lender shall pay to the Administrative Agent its Pro Rata Percentage of the
unreimbursed LC Disbursement in the same manner as provided in Section 2.02(f)
with respect to Loans made by such Lender, and the Administrative Agent shall
promptly pay to the Issuing Bank the amounts so received by it from the
Revolving Lenders. Promptly following receipt by the Administrative Agent of any
payment from Borrower pursuant to this paragraph, the Administrative Agent
shall, to the extent that Revolving Lenders have made payments pursuant to this
paragraph to reimburse the Issuing Bank, distribute such payment to such Lenders
and the Issuing Bank as their interests may appear. Any payment made by a
Revolving Lender pursuant to this paragraph to reimburse the Issuing Bank for
any LC Disbursement (other than the funding of ABR Revolving Loans or a
Swingline Loan as contemplated above) shall not constitute a Loan and shall not
relieve Borrower of its obligation to reimburse such LC Disbursement.
67
(f) Obligations Absolute. The obligation of Borrower to reimburse LC
Disbursements as provided in paragraph (e) of this Section 2.18 shall be
absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of any
Letter of Credit or this Agreement, or any term or provision therein, (ii) any
draft or other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by the Issuing Bank under a Letter of
Credit against presentation of a draft or other document that does not comply
with the terms of such Letter of Credit, or (iv) any other event or circumstance
whatsoever, whether or not similar to any of the foregoing, that might, but for
the provisions of this Section 2.18, constitute a legal or equitable discharge
of, or provide a right of setoff against, the obligations of Borrower hereunder.
Neither the Administrative Agent, the Lenders nor the Issuing Bank, nor any of
their Affiliates, shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
Issuing Bank; provided, that the foregoing shall not be construed to excuse the
Issuing Bank from liability to Borrower to the extent of any direct damages (as
opposed to consequential damages, claims in respect of which are hereby waived
by Borrower to the extent permitted by applicable law) suffered by Borrower that
are caused by the Issuing Bank's failure to exercise reasonable care when
determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof. The parties hereto expressly agree that,
in the absence of gross negligence or willful misconduct on the part of the
Issuing Bank (as finally determined by a court of competent jurisdiction), the
Issuing Bank shall be deemed to have exercised care in each such determination.
In furtherance of the foregoing and without limiting the generality thereof, the
parties agree that, with respect to documents presented which appear on their
face to be in substantial compliance with the terms of a Letter of Credit, the
Issuing Bank may, in its sole discretion, either accept and make payment upon
such documents without responsibility for further investigation, regardless of
any notice or information to the contrary, or refuse to accept and make payment
upon such documents if such documents are not in strict compliance with the
terms of such Letter of Credit.
(g) Disbursement Procedures. The Issuing Bank shall, promptly following
its receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit. The Issuing Bank shall promptly notify the
Administrative Agent and Borrower by telephone (confirmed by telecopy) of such
demand for payment and whether the Issuing Bank has made or will make an LC
Disbursement thereunder; provided, that any failure to give or delay in giving
such notice shall not relieve Borrower of its obligation to reimburse the
Issuing Bank and the Revolving Lenders with respect to any such LC Disbursement
(other than with respect to the timing of such reimbursement obligation set
forth in Section 2.18(e)).
(h) Interim Interest. If the Issuing Bank shall make any LC
Disbursement, then, unless Borrower shall reimburse such LC Disbursement in full
on the date such LC Disbursement is made, the unpaid amount thereof shall bear
interest, for each day from and including the date
68
such LC Disbursement is made to but excluding the date that Borrower reimburses
such LC Disbursement, at the rate per annum then applicable to ABR Revolving
Loans; provided, that, if Borrower fails to reimburse such LC Disbursement when
due pursuant to paragraph (e) of this Section 2.18, then Section 2.06(c) shall
apply. Interest accrued pursuant to this paragraph shall be for the account of
the Issuing Bank, except that interest accrued on and after the date of payment
by any Revolving Lender pursuant to paragraph (e) of this Section 2.18 to
reimburse the Issuing Bank shall be for the account of such Lender to the extent
of such payment.
(i) Resignation or Removal of the Issuing Bank. The Issuing Bank may
resign as Issuing Bank hereunder at any time upon at least 30 days' prior notice
to the Lenders, the Administrative Agent and Borrower. If the resigning Issuing
Bank is UBS, the successor Issuing Bank shall be Xxxxxxx Xxxxx Bank USA. The
Issuing Bank may be replaced at any time by written agreement among Borrower,
the Administrative Agent, the replaced Issuing Bank and the successor Issuing
Bank. One or more Lenders may be appointed as additional Issuing Banks in
accordance with subsection (k) below. The Administrative Agent shall notify the
Lenders of any such replacement of the Issuing Bank or any such additional
Issuing Bank. At the time any such resignation or replacement shall become
effective, Borrower shall pay all unpaid fees accrued for the account of the
replaced Issuing Bank pursuant to Section 2.05(c). From and after the effective
date of any such resignation or replacement or addition, as applicable, (i) the
successor or additional Issuing Bank shall have all the rights and obligations
of the Issuing Bank under this Agreement with respect to Letters of Credit to be
issued thereafter and (ii) references herein to the term "ISSUING BANK" shall be
deemed to refer to such successor or such addition or to any previous Issuing
Bank, or to such successor or such additional Issuing Bank and all previous
Issuing Banks, as the context shall require. After the resignation or
replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain
a party hereto and shall continue to have all the rights and obligations of an
Issuing Bank under this Agreement with respect to Letters of Credit issued by it
prior to such resignation or replacement, but shall not be required to issue
additional Letters of Credit. If at any time there is more than one Issuing Bank
hereunder, Borrower may, in its discretion, select which Issuing Bank is to
issue any particular Letter of Credit.
(j) Cash Collateralization. If any Event of Default shall occur and be
continuing, on the Business Day that Borrower receives notice from the
Administrative Agent or the Required Lenders (or, if the maturity of the Loans
has been accelerated, Revolving Lenders with LC Exposure representing greater
than 50% of the total LC Exposure) demanding the deposit of cash collateral
pursuant to this paragraph, Borrower shall deposit in the Cash Collateral
Account, in the name of the Collateral Agent and for the benefit of the Secured
Parties, an amount in cash equal to the LC Exposure as of such date plus any
accrued and unpaid interest thereon; provided, that the obligation to deposit
such cash collateral shall become effective immediately, and such deposit shall
become immediately due and payable, without demand or other notice of any kind,
upon the occurrence of any Event of Default with respect to Borrower described
in clause (g) or (h) of Article VIII. Each such deposit shall be held by the
Collateral Agent in a Cash Collateral Account pursuant to Section 9.04 as
collateral for the payment and performance of the obligations of Borrower under
this Agreement. The Collateral Agent shall have exclusive dominion and control,
including the exclusive right of withdrawal, over such account. Other than any
interest earned on the investment of such deposits, which investments shall be
made at the option and sole discretion of the Collateral Agent and at the risk
and expense of Borrower,
69
such deposits shall not bear interest. Interest or profits, if any, on such
investments shall accumulate in such account. Moneys in such account shall be
applied by the Collateral Agent to reimburse the Issuing Bank for LC
Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of
Borrower for the LC Exposure at such time or, if the maturity of the Loans has
been accelerated (but subject to the consent of Revolving Lenders with LC
Exposure representing greater than 50% of the total LC Exposure), be applied to
satisfy other Obligations of Borrower under this Agreement. If Borrower is
required to provide an amount of cash collateral hereunder as a result of the
occurrence of an Event of Default, such amount plus any accrued interest or
realized profits of such amounts (to the extent not applied as aforesaid) shall
be returned to Borrower within three Business Days after all Events of Default
have been cured or waived. If Borrower is required to provide an amount of such
collateral hereunder pursuant to Section 2.10(b), such amount plus any accrued
interest or realized profits on account of such amount (to the extent not
applied as aforesaid) shall be returned to Borrower as and to the extent that,
after giving effect to such return, Borrower would remain in compliance with
Section 2.10(b) and no Default or Event of Default shall have occurred and be
continuing.
(k) Additional Issuing Banks. Borrower may, at any time and from time
to time with the consent of the Administrative Agent (which consent shall not be
unreasonably withheld) and such Lender, designate one or more additional Lenders
to act as an issuing bank under the terms of this Agreement. Any Lender
designated as an issuing bank pursuant to this paragraph (k) shall be deemed (in
addition to being a Lender) to be the Issuing Bank with respect to Letters of
Credit issued or to be issued by such Lender, and all references herein and in
the other Loan Documents to the term "Issuing Bank" shall, with respect to such
Letters of Credit, be deemed to refer to such Lender in its capacity as Issuing
Bank, as the context shall require.
(l) The Issuing Bank shall be under no obligation to issue any Letter
of Credit if:
(i) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or restrain the
Issuing Bank from issuing such Letter of Credit, or any law applicable to the
Issuing Bank or any request or directive (whether or not having the force of
law) from any Governmental Authority with jurisdiction over the Issuing Bank
shall prohibit, or request that the Issuing Bank refrain from, the issuance of
letters of credit generally or such Letter of Credit in particular or shall
impose upon the Issuing Bank with respect to such Letter of Credit any
restriction, reserve or capital requirement (for which the Issuing Bank is not
otherwise compensated hereunder) not in effect on the Closing Date, or shall
impose upon the Issuing Bank any unreimbursed loss, cost or expense which was
not applicable on the Closing Date and which the Issuing Bank in good xxxxx
xxxxx material to it; or
(ii) the issuance of such Letter of Credit would violate
one or more policies of the Issuing Bank.
(m) The Issuing Bank shall be under no obligation to amend any Letter
of Credit if (A) the Issuing Bank would have no obligation at such time to issue
such Letter of Credit in its amended form under the terms hereof, or (B) the
beneficiary of such Letter of Credit does not accept the proposed amendment to
such Letter of Credit.
70
SECTION 2.19 DETERMINATION OF BORROWING BASE.
(a) Eligible Accounts. On any date of determination of the Borrowing
Base, all of the Accounts owned by Borrower and each Borrowing Base Guarantor,
as applicable, and reflected in the most recent Borrowing Base Certificate
delivered by the Borrower to the Collateral Agent and the Administrative Agent
shall be "Eligible Accounts" for the purposes of this Agreement, except any
Account to which any of the exclusionary criteria set forth below applies. In
addition, the Collateral Agent reserves the right, at any time and from time to
time after the Closing Date, to adjust any of the criteria set forth below, to
establish new criteria and to adjust the applicable advance rate with respect to
Eligible Accounts, in its reasonable credit judgment, subject to the approval of
the Administrative Agent and the Supermajority Lenders in the case of
adjustments, new criteria or changes in the applicable advance rates which have
the effect of making more credit available. Eligible Accounts shall not include
any of the following Accounts:
(i) any Account in which the Collateral Agent, on behalf
of the Secured Parties, does not have a first priority and exclusive perfected
Lien;
(ii) any Account that is not owned by a Borrower or a
Borrowing Base Guarantor;
(iii) any Account due from an Account Debtor that is not
domiciled in the United States or Canada or, if not a natural Person, it is not
a Domestic or Canadian Person;
(iv) any Account that is payable in any currency other
than Dollars or Canadian Dollars;
(v) any Account that does not arise from the sale of
goods or the performance of services by such Borrower or Borrowing Base
Guarantor in the ordinary course of its business;
(vi) any Account that does not comply with all applicable
legal requirements, including, without limitation, all laws, rules, regulations
and orders of any Governmental Authority (including any Account due from an
Account Debtor located in the States of New Jersey, Minnesota, Georgia or any
other State, unless Borrower and the Borrowing Base Guarantor, as applicable (at
the time the Account was created and at all times thereafter) (i) had filed and
has maintained effective a current notice of business activities report with the
appropriate office or agency of the States of New Jersey, Minnesota, Georgia, or
any other State, as applicable, or (ii) was and has continued to be exempt from
filing such report and has provided the Lenders with satisfactory evidence
thereof);
(vii) any Account (a) upon which the right to receive
payment of either Borrower or any Borrowing Base Guarantor, as applicable, is
not absolute or is contingent upon the fulfillment of any condition whatsoever
unless such condition is satisfied or (b) as to which either Borrower or any
Borrowing Base Guarantor, as applicable, is not able to bring suit or otherwise
enforce its remedies against the Account Debtor through judicial or
administrative process or (c) that represents a progress billing consisting of
an invoice for goods sold or used or services rendered pursuant to a contract
under which the Account Debtor's obligation to pay that
71
invoice is subject to the Borrower's or Borrowing Base Guarantor', as
applicable, completion of further performance under such contract or is subject
to the equitable lien of a surety bond issuer;
(viii) to the extent that any defense, counterclaim, setoff
or dispute is asserted as to such Account, it being understood that the
remaining balance of the Account shall be eligible;
(ix) any Account that is reissued in respect of partial
payment, including without limitation debit memos and charge backs;
(x) any Account that is not a true and correct statement
of bona fide indebtedness incurred in the amount of the Account for merchandise
sold to or services rendered and accepted by the applicable Account Debtor;
(xi) any Account with respect to which an invoice or other
electronic transmission constituting a request for payment, reasonably
acceptable to the Collateral Agent in form and substance, has not been sent on a
timely basis to the applicable Account Debtor according to the normal invoicing
and timing procedures of Borrower or Borrowing Base Guarantor, as applicable;
(xii) any Account that arises from a sale to any director,
officer, other employee or Affiliate of Borrower or any Borrowing Base Guarantor
(including, without limitation, NextGen), or to any entity that has any common
officer or director with any Borrower or Borrowing Base Guarantor;
(xiii) to the extent the Borrower or any Subsidiary is
liable for goods sold or services rendered by the applicable Account Debtor to
the Borrower or any Subsidiary but only to the extent of the potential offset;
(xiv) any Account that arises with respect to goods that
are delivered on a xxxx-and-hold, cash-on-delivery basis or placed on
consignment (other than Eligible Consigned Inventory), guaranteed sale or other
terms by reason of which the payment by the Account Debtor is or may be
conditional or with respect to which the applicable Account Debtor is treated by
Borrower or a Borrowing Base Guarantor as a cash-in-advance terms customer
(regardless of whether shipment was in fact withheld subject to receiving
payment);
(xv) any Account that is in default; provided, that,
without limiting the generality of the foregoing, an Account shall be deemed in
default upon the occurrence of any of the following:
(a) any Account not paid within 90 days
following its original invoice date,
(b) any Account which is due according to its
original terms of sale more than 90 days after its original
invoice date, except as may be approved in advance and in
writing by Collateral Agent in its discretion, with such
limitations as the Collateral Agent may deem appropriate; it
being understood that as of the Closing Date, an Account of
AutoZone, Inc., Xxxxxx Xxxxx Corporation, Graybar Electric
Company, Inc. or State Electric Supply Co., Inc. which is due
according
72
to its original terms of sale more than 90 days after its
original invoice date shall not be deemed in default by reason
of this clause (b) or by reason of clause (a) above, as long
as such Account does not remain unpaid for more than 150 days
after its original invoice date or is more than 30 days past
due according to its original terms of sale; or
(c) the Account Debtor obligated upon such
Account suspends business, makes a general assignment for the
benefit of creditors or fails to pay its debts generally as
they come due; or
(d) a petition is filed by or against any
Account Debtor obligated upon such Account under any
bankruptcy law or any other federal, state, provincial or
foreign (including any provincial) receivership, insolvency
relief or other law or laws for the relief of debtors;
(xvi) any Account that is the obligation of an Account
Debtor (other than an individual) if 50% or more of the Dollar amount of all
Accounts owing by that Account Debtor are ineligible under the other criteria
set forth in this Section 2.19(a);
(xvii) any Account as to which any of the representations or
warranties in the Loan Documents are untrue;
(xviii) to the extent such Account is evidenced by a
judgment, Instrument or Chattel Paper;
(xix) to the extent such Account exceeds any credit limit
established by the Collateral Agent, in its reasonable credit judgment,
following prior notice of such limit by the Collateral Agent to the Borrower;
(xx) that portion of any Account (a) in respect of which
there has been, or should have been, established by the Borrower or any
Borrowing Base Guarantor a contra account, whether in respect of contractual
allowances with respect to such Account, audit adjustment, anticipated discounts
or otherwise, or in respect of which Borrower or any Borrowing Base Guarantor
accrues liability for deposits made by Account Debtors in respect of the reels
used to store cable, or (b) which is due from an Account Debtor to whom the
Borrower or any Borrowing Base Guarantor owes a trade payable, but only to the
extent of such trade payable or (c) which the Borrower or any Borrowing Base
Guarantor knows is subject to the exercise by an Account Debtor of any right of
recession, set-off, recoupment, counterclaim or defense or (d) of any Account
Debtor that is taking part in a volume rebate program and is meeting the
requisite volume criteria; or
(xxi) any Account on which the Account Debtor is a
Governmental Authority, unless Borrower or any Borrowing Base Guarantor, as
applicable, has assigned its rights to payment of such Account to the
Administrative Agent pursuant to, in the case of a federal Governmental
Authority, the Assignment of Claims Act of 1940, as amended, or Financial
Administration Act (Canada), as amended, and pursuant to applicable law, if any,
in the case of any other Governmental Authority, and such assignment has been
accepted and acknowledged by the appropriate government officers.
73
(b) Eligible Inventory. For purposes of this Agreement, Eligible
Inventory shall exclude any Inventory to which any of the exclusionary criteria
set forth below applies. The Collateral Agent shall have the right to establish,
modify or eliminate Reserves against Eligible Inventory from time to time in its
reasonable credit judgment. In addition, the Collateral Agent reserves the
right, at any time and from time to time after the Closing Date, to adjust any
of the criteria set forth below, to establish new criteria and to adjust the
applicable advance rate with respect to Eligible Inventory, in its reasonable
credit judgment, subject to the approval of the Administrative Agent and the
Supermajority Lenders in the case of adjustments, new criteria, changes in the
applicable advance rate or the elimination of Reserves which have the effect of
making more credit available. Eligible Inventory shall not include any Inventory
of Borrower or any Borrowing Base Guarantor that:
(i) the Collateral Agent, on behalf of Secured Parties,
does not have a first priority and exclusive perfected Lien on such Inventory;
(ii) is not located on premises in United States or
Canada;
(iii) (A) is located on premises leased by Borrower or a
Borrowing Base Guarantor, unless (x) at such location the aggregate value of
Inventory exceeds $250,000, and (y) either (1) a reasonably satisfactory
Landlord Lien Waiver and Access Agreement has been delivered to the Collateral
Agent, or (2) Reserves reasonably satisfactory to the Collateral Agent have been
established with respect thereto or (B) is stored with a bailee or warehouseman
where the aggregate value of Inventory exceeds $250,000 unless either (x) a
reasonably satisfactory, acknowledged bailee waiver letter has been received by
the Collateral Agent or (y) Reserves reasonably satisfactory to the Collateral
Agent have been established with respect thereto, or (C) is located at an owned
location subject to a mortgage in favor of a lender other than the Collateral
Agent where the aggregate value of Inventory exceeds $250,000 unless either (x)
a reasonably satisfactory mortgagee waiver has been delivered to the Collateral
Agent or (y) Reserves reasonably satisfactory to the Collateral Agent have been
established with respect thereto;
(iv) is placed on consignment (other than Eligible
Consigned Inventory);
(v) is covered by a negotiable document of title, unless
such document has been delivered to the Collateral Agent with all necessary
endorsements, free and clear of all Liens except those in favor of the
Collateral Agent and the Lenders and landlords, carriers, bailees and
warehousemen if clause (iii) above has been complied with;
(vi) is to be returned to suppliers;
(vii) is obsolete, unsalable, shopworn, seconds, damaged or
unfit for sale;
(viii) is slow moving (in excess of 1-year supply);
(ix) consists of display items, samples or packing or
shipping materials, manufacturing supplies or replacement parts (it being
understood that Eligible Inventory shall not exclude work-in-process Inventory
if it is not excluded in accordance with other criteria set
74
forth herein, unless otherwise determined by the Collateral Agent in its
reasonable credit judgment);
(x) is not of a type held for sale in the ordinary course
of Borrower's or any Borrowing Base Guarantor's, as applicable, business;
(xi) breaches any of the representations or warranties
pertaining to Inventory set forth in the Loan Documents;
(xii) consists of Hazardous Material or goods that can be
transported or sold only with licenses that are not readily available;
(xiii) is not covered by casualty insurance maintained as
required by Section 5.04;
(xiv) consists of custom made Inventory which is not
saleable to any other customer or in ordinary course;
(xv) is in transit; or
(xvi) is subject to any licensing arrangement the effect of
which would be to limit the ability of Collateral Agent, or any Person selling
the Inventory on behalf of Collateral Agent, to sell such Inventory in
enforcement of the Collateral Agent's Liens, without further consent or payment
to the licensor or other.
(c) Eligible Equipment and Eligible Real Property. The Collateral Agent
shall have the right to establish, modify or eliminate Reserves against Eligible
Equipment and Eligible Real Property from time to time in its reasonable credit
judgment. In addition, the Collateral Agent reserves the right, at any time and
from time to time after the Closing Date, to adjust any of the criteria set
forth in the definitions of the terms "Eligible Equipment" and "Eligible Real
Property", to establish new criteria and to adjust the applicable advance rate
with respect to Eligible Equipment or Eligible Real Property, in its reasonable
credit judgment, subject to the approval of the Administrative Agent and the
Supermajority Lenders in the case of adjustments, new criteria, changes in the
applicable advance rate or the elimination of Reserves which have the effect of
making more credit available and in the case of any change in the FALV
Amortization Factor. Any Equipment affixed to the Mortgaged Real Property listed
on Schedule 1.01(e), if otherwise eligible hereunder, shall be deemed Eligible
Equipment rather than Eligible Real Property.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
Each Loan Party represents and warrants to the Administrative Agent,
the Collateral Agent, the Issuing Bank and each of the Lenders (with references
to the Companies being references thereto after giving effect to the
Transactions unless otherwise expressly stated) that:
75
SECTION 3.01 ORGANIZATION; POWERS. Each Company (a) is duly organized
and validly existing under the laws of the jurisdiction of its organization, (b)
has all requisite power and authority to carry on its business as now conducted
and to own and lease its Property and (c) is qualified and in good standing (to
the extent such concept is applicable in the applicable jurisdiction) to do
business in every jurisdiction where such qualification is required, except in
such jurisdictions where the failure to so qualify or be in good standing,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect.
SECTION 3.02 AUTHORIZATION; ENFORCEABILITY. The Transactions to be
entered into by each Loan Party are within such Loan Party's powers and have
been duly authorized by all necessary action. This Agreement has been duly
executed and delivered by each Loan Party and constitutes, and each other Loan
Document to which any Loan Party is to be a party, when executed and delivered
by such Loan Party, will constitute, a legal, valid and binding obligation of
such Loan Party, enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other laws affecting
creditors' rights generally and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law.
SECTION 3.03 GOVERNMENTAL APPROVALS; NO CONFLICTS. Except as set forth
on Schedule 3.03, the Transactions (a) do not require any consent or approval
of, registration or filing with, or any other action by, any Governmental
Authority, except (i) such as have been obtained or made and are in full force
and effect, (ii) filings necessary to perfect Liens created under the Loan
Documents and (iii) consents, approvals, registrations, filings or actions the
failure of which to obtain or perform could not reasonably be expected to result
in a Material Adverse Effect, (b) will not violate the charter, by-laws or other
organizational documents of any Company or any order of any Governmental
Authority, (c) will not violate, result in a default or require any consent or
approval under any applicable law or regulation, indenture, agreement or other
instrument binding upon any Company or its assets, or give rise to a right
thereunder to require any payment to be made by any Company, except for
violations, defaults or the creation of such rights that could not reasonably be
expected to result in a Material Adverse Effect, and (d) will not result in the
creation or imposition of any Lien on any Property of any Company, except Liens
created under the Loan Documents and Permitted Liens.
SECTION 3.04 FINANCIAL STATEMENTS. (a) Borrower has heretofore
furnished to the Lenders the consolidated balance sheets and related statements
of income, stockholders' equity and cash flows of Holdings and its consolidated
Subsidiaries (i) as of and for the fiscal years ended December 31, 2000, 2001
and 2002, audited by and accompanied by the opinion of Deloitte & Touche LLP,
independent public accountants, and (y) as of and for the nine-month period
ended September 30, 2003 and for the comparable period of the preceding fiscal
year, in each case, certified by the Chief Financial Officer of Holdings. Such
financial statements have been prepared in accordance with GAAP consistently
applied and present fairly and accurately the financial condition and results of
operations and cash flows of Holdings and its consolidated Subsidiaries as of
such dates and for such periods. Except as set forth in such financial
statements or schedules hereto, as of the Closing Date, there are no liabilities
of any Company of any kind, whether accrued, contingent, absolute, determined,
determinable or otherwise, which if unpaid could reasonably be expected to
result in a Material Adverse Effect, and there is no existing condition,
situation or set of circumstances which could reasonably be expected to result
76
in such a liability, other than liabilities under the Loan Documents and the
Qualified Senior Note Documents.
(b) Borrower has heretofore delivered to the Lenders Holdings' (i)
Confidential Information Memoranda, (ii) unaudited consolidated and
consolidating balance sheets and statements of income and cash flows as of and
for the nine-month period ended September 30, 2003 and for the comparable period
of the preceding fiscal year and (iii) consolidated projections for a 5-year
period after the Closing Date. Such projections and financial statements have
been prepared in good faith by the Loan Parties, based on the assumptions stated
therein (which assumptions are believed by the Loan Parties on the date hereof
and on the Closing Date to be reasonable), are based on the best information
available to the Loan Parties as of the date of delivery thereof, accurately
reflect all adjustments required to be made to give effect to the Transactions.
The projections are based upon the same accounting principles as those used in
the preparation of the financial statements described above and the estimates
and assumptions stated therein, all of which the Loan Parties believes to be
reasonable and fair in light of current conditions and current facts known to
the Loan Parties and, as of the Closing Date, reflect the Loan Parties' good
faith and reasonable estimates of the future financial performance of the Loan
Parties for the period set forth therein. The projections are not a guaranty of
future performance, and actual results may differ from the projections.
(c) Since December 31, 2002, there has been no event, change or
occurrence that, individually or in the aggregate, has had or could reasonably
be expected to result in a Material Adverse Effect.
SECTION 3.05 PROPERTIES. (a) Each Company has good title to, or valid
leasehold interests in, all its Property material to its business, except for
minor irregularities or deficiencies in title that, individually or in the
aggregate, do not interfere with its ability to conduct its business as
currently conducted or to utilize such Property for its intended purpose. Title
to all such Property held by such Company is free and clear of all Liens except
for Permitted Liens. The Property of the Companies, taken as a whole, (i) is in
good operating order, condition and repair (ordinary wear and tear excepted)
(except to the extent that the failure to be in such condition could not
reasonably be expected to result in a Material Adverse Effect) and (ii)
constitutes all the Property which is required for the business and operations
of the Companies as presently conducted.
(b) Real Property. As of the Closing Date,
(i) Schedule 3.05(b) contains a true and complete list of
each interest in Real Property owned by any Company and describes the type of
interest therein held by such Company. Schedule 3.05(b) contains a true and
complete list of each Real Property leased, subleased or otherwise occupied or
utilized by any Company, as lessee, sublessee, franchisee or licensee, and
describes the type of interest therein held by such Company and whether such
lease, sublease or other instrument requires the consent of the landlord
thereunder or other parties thereto to the Transactions.
(ii) The Real Property and the current use thereof
complies in all material respects with (i) all applicable Requirements of Law
(including building and zoning ordinances
77
and codes), and the Borrower or the relevant Company is not an illegal user of
such Real Property, and (ii) all insurance requirements of this Agreement, in
each case, except where noncompliance could not reasonably be expected to have a
Material Adverse Effect.
(iii) No Casualty Event has been commenced or, to the best
knowledge of Borrower and the Companies, is contemplated with respect to all or
any portion of any material Real Property or for any materially adverse
relocation of roadways providing access to such Real Property other than a
Casualty Event relating to Real Property that has been restored, replaced or
rebuilt.
(iv) There are no current, pending or, to the best
knowledge of Borrower and the Companies, proposed special or other assessments
for public improvements or otherwise affecting any Mortgaged Real Properties,
nor are there any contemplated improvements to such Mortgaged Real Properties
that may result in such special or other assessments, in each case, other than
such assessments that will be paid prior to delinquency.
(v) Neither the Borrower nor the Companies have suffered,
permitted or initiated the joint assessment of any Mortgaged Real Property with
any other real property constituting a separate tax lot that would interfere
with the legal foreclosure of such Mortgaged Real Property independent of any
property that is not a Mortgaged Real Property. All owned Real Property is
comprised of one or more parcels, each of which or such parcels together
constitutes a separate tax lot and none of which constitutes a portion of any
other tax lot.
(vi) Each of the Borrower and the Companies has obtained
all material permits (including assembly permits), licenses, variances and
certificates required by Requirements of Law to be obtained by such Person and
necessary to the use and operation of the Mortgaged Real Properties for the
purposes for which they are currently used. Each of the Borrower and the
Companies has obtained all permits (including assembly permits), licenses,
variances and certificates required by Requirements of Law to be obtained by
such Person and necessary to the use and operation of Real Property other than
Mortgaged Real Properties except to the extent that the failure to obtain such
permits, licenses, variances and certificates could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect. The use being made of
all Real Property is in material conformity with the certificate of occupancy
and/or such other permits, licenses, variances and certificates for such Real
Property and any other reciprocal easement agreements, restrictions, covenants
or conditions affecting such Real Property.
(vii) Except for maintenance and repairs in the ordinary
course of business or as set forth on Schedule 3.05(b), to the best knowledge of
Borrower and the Companies, all Real Property owned by Loan Parties is free from
structural defects and all building systems contained therein are in good
working order and condition, ordinary wear and tear excepted, suitable for the
purposes for which they are currently being used.
(viii) No Person other than the Companies has any possessory
interest in any Real Property or right to occupy any Real Property except for
leases, subleases and concessions (i) in the ordinary course of business and
(ii) on terms no less favorable to the Companies than terms that were available
to unaffiliated parties in the market generally at the time entered into.
78
There are no outstanding options to purchase or rights of first refusal or
restrictions on transferability affecting any owned Real Property.
(ix) Except as could not reasonably be expected to have a
material adverse effect on the affected Property, (i) all Real Property has
adequate rights of access to public ways to permit the Real Property to be used
for its intended purpose and is served by operating and adequate water,
electric, telephone, sewer, sanitary sewer and storm drain facilities, (ii) all
public utilities necessary to the continued use and enjoyment of the Real
Property and the Companies have the legal right to the continued use thereof,
(iii) all roads necessary for the full utilization of the Real Property for its
current purpose have been completed and dedicated to public use and accepted by
all Governmental Authorities or are the subject of access easements for the
benefit of such Real Property and (iv) all reciprocal easement agreements
affecting any Real Property are in full force and effect and no Company is aware
of any defaults thereunder. Except for public streets and sidewalks and other
non-material parcels in respect of which any further discontinuance of use or
occupying would not materially interfere with the value or utility of adjacent
or nearby Real Property, no Company uses or occupies any real property other
than such Real Property in connection with the use and operation of any Real
Property.
(x) No building or structure constituting Real Property
or any appurtenance thereto or equipment thereon, or the use, operation or
maintenance thereof, violates any restrictive covenant or encroaches on any
easement or on any property owned by others, which violation or encroachment
materially interferes with the use or could materially adversely affect the
value of such building, structure or appurtenance or which encroachment is
necessary for the operation of the business at any Real Property. All buildings,
structures, appurtenances and equipment necessary for the use of each Mortgaged
Property for the purpose for which it is currently being used are located on the
real property encumbered by such Mortgage.
(xi) Each parcel of Real Property, including each lease,
has adequate available parking to meet legal and operating requirements (after
taking into account reciprocal easement agreements and other easements on
adjoining or nearby land).
(xii) No portion of the Real Property owned by a Loan Party
has suffered any material damage by fire or other material casualty loss that
has not heretofore been substantially repaired and restored to its original
condition. No portion of the Real Property owned by a Loan Party (other than the
Real Property located in Willimantic, Connecticut for which Borrower has flood
insurance) is located in a special flood hazard area as designated by any
federal governmental authorities.
(c) Each Company owns, or is licensed to use, all patents, patent
applications, trademarks, trade names, servicemarks, copyrights, technology,
trade secrets, proprietary information, domain names, know-how and processes
necessary for the conduct of its business as currently conducted (the
"INTELLECTUAL PROPERTY"), except for those the failure to own or license which,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect. No claim has been asserted and is pending by any
Person challenging or questioning the use of any such Intellectual Property or
the validity or effectiveness of any such Intellectual Property, nor does any
Company know of any valid basis for any such claim (except for such claim and
infringement that could not reasonably be expected to result in a
79
Material Adverse Effect). The use of such Intellectual Property by each Company
does not infringe the rights of any Person, except for such claims and
infringements that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.
(d) (i) No Company has received any notice of, nor has any knowledge
of, the occurrence or pendency or contemplation of any Casualty Event affecting
all or any portion of the Property and (ii) no Mortgage encumbers improved Real
Property that is located in an area that has been identified by the Secretary of
Housing and Urban Development as an area having special flood hazards and with
respect to which flood insurance has been made available under the National
Flood Insurance Act of 1968.
SECTION 3.06 EQUITY INTERESTS AND SUBSIDIARIES. (a) Schedule 3.06(a)
sets forth a list of (i) all the Subsidiaries and their jurisdiction of
organization as of the Closing Date and (ii) the number of shares of each class
of its Equity Interests authorized, and the number outstanding (and the record
holder of such Equity Interests), on the Closing Date and the number of shares
covered by all outstanding options, warrants, rights of conversion or purchase
and similar rights at the Closing Date. All Equity Interests of each Company are
duly and validly issued and are fully paid and non-assessable and are owned by
Holdings or Borrower, directly or indirectly through Wholly Owned Subsidiaries
and all Equity Interests of Borrower are owned directly by Intermediate Holdings
and all Equity Interests of Intermediate Holdings are owned directly by
Holdings. Each Loan Party is the record and beneficial owner of, and has good
and marketable title to, the Equity Interests pledged by it under the Security
Agreements and Foreign Pledge Agreements, free of any and all Liens, rights or
claims of other Persons, except the security interest created by the Security
Agreements, and there are no outstanding warrants, options or other rights to
purchase, or shareholder, voting trust or similar agreements outstanding with
respect to, or Property that is convertible into, or that requires the issuance
or sale of, any such Equity Interests.
(b) No consent of any Person including any other general or limited
partner, any other member of a limited liability company, any other shareholder
or any other trust beneficiary is necessary or desirable in connection with the
creation, perfection or first priority status of the security interest of the
Collateral Agent in any Equity Interests pledged to the Collateral Agent for the
benefit of the Secured Parties under the Security Documents or the exercise by
the Collateral Agent of the voting or other rights provided for in the Security
Documents or the exercise of remedies in respect thereof.
(c) An accurate organization chart, showing the ownership structure of
Holdings, Borrower and each Subsidiary on the Closing Date, and after giving
effect to the Transaction, is set forth on Schedule 3.06(c).
SECTION 3.07 LITIGATION; COMPLIANCE WITH LAWS. (a) As of the Closing
Date, there are no actions, suits or proceedings at law or in equity by or
before any Governmental Authority now pending or, to the knowledge of any
Company, threatened against or affecting any Company or any business, Property
or rights of any such Person (i) that involve any Loan Document or the
Transactions or (ii) as to which there is a reasonable possibility of an adverse
determination and that, if adversely determined, could reasonably be expected,
individually or in the aggregate, to result in a Material Adverse Effect.
80
(b) Except for matters covered by Section 3.17, no Company or any of
its Property is in violation of, nor will the continued operation of their
Property as currently conducted violate, any Requirements of Law (including any
zoning or building ordinance, code or approval or any building permits) or any
restrictions of record or agreements affecting the Real Property or is in
default with respect to any judgment, writ, injunction, decree or order of any
Governmental Authority, where such violation or default could reasonably be
expected to result in a Material Adverse Effect.
SECTION 3.08 AGREEMENTS. (a) No Company is a party to any agreement or
instrument or subject to any corporate or other constitutional restriction that
has resulted or could reasonably be expected to result in a Material Adverse
Effect.
(b) No Company is in default in any manner under any provision of any
indenture or other agreement or instrument evidencing Indebtedness, or any other
agreement or instrument to which it is a party or by which it or any of its
Property are or may be bound, where such default could reasonably be expected to
result in a Material Adverse Effect.
(c) Schedule 3.08(c) accurately and completely lists all material
agreements (other than leases of Real Property set forth on Schedule 3.05(b) and
other than the Intercompany Agreements) to which any Company is a party which
are in effect on the date hereof in connection with the operation of the
business conducted thereby and Borrower has delivered to the Administrative
Agent and the Collateral Agent complete and correct copies of all such material
agreements, including any amendments, supplements or modifications with respect
thereto.
SECTION 3.09 FEDERAL RESERVE REGULATIONS. (a) No Company is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of buying or carrying Margin Stock.
(b) No part of the proceeds of any Loan or any Letter of Credit will be
used, whether directly or indirectly, and whether immediately, incidentally or
ultimately, for any purpose that entails a violation of, or that is inconsistent
with, the provisions of the regulations of the Board, including Regulation T, U
or X. The pledge of the Security Agreement Collateral pursuant to the Security
Agreements and Foreign Pledge Agreements does not violate such regulations.
SECTION 3.10 INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING COMPANY
ACT. No Company is (a) an "investment company" or a company "controlled" by an
"investment company," as defined in, or subject to regulation under, the
Investment Company Act of 1940, as amended, or (b) a "holding company," an
"affiliate" of a "holding company" or a "subsidiary company" of a "holding
company," as defined in, or subject to regulation under, the Public Utility
Holding Company Act of 1935, as amended.
SECTION 3.11 USE OF PROCEEDS. Borrower will used the proceeds of the
Revolving Loans on and after the Closing Date to effect the Refinancing, to
finance any Permitted Loan Funded Acquisition and for general corporate
purposes.
SECTION 3.12 TAXES. Each Company has (a) timely filed or caused to be
timely filed all federal Tax Returns and all material, state, local and foreign
Tax Returns or materials
81
required to have been filed by it and all such Tax Returns are true and correct
in all material respects and has (b) duly and timely paid or caused to be duly
and timely paid all Taxes (whether or not shown on any Tax Return) due and
payable by it and all assessments received by it, except Taxes (i) that are
being contested in good faith by appropriate proceedings and for which such
Company shall have set aside on its books adequate reserves in accordance with
GAAP or (ii) which could not, individually or in the aggregate, have a Material
Adverse Effect; provided, that any such contest of Taxes with respect to
Collateral shall also satisfy the Contested Collateral Lien Conditions. Each
Company has made adequate provision in accordance with GAAP for all Taxes not
yet due and payable. Each Company is unaware of any proposed or pending tax
assessments, deficiencies or audits that could be reasonably expected to,
individually or in the aggregate, result in a Material Adverse Effect.
SECTION 3.13 NO MATERIAL MISSTATEMENTS. None of any information,
report, financial statement, exhibit or schedule furnished by or on behalf of
any Company to the Administrative Agent or any Lender in connection with the
negotiation of any Loan Document or included therein or delivered pursuant
thereto (including the Confidential Information Memoranda) contained, contains
or will contain any material misstatement of fact or omission, omits or will
omit to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were, are or will be made, not
misleading as of the date such information is dated or certified; provided, that
to the extent any such information, report, financial statement, exhibit or
schedule was based upon or constitutes a forecast or projection, each Loan Party
represents only that it acted in good faith and utilized reasonable assumptions
and due care in the preparation of such information, report, financial
statement, exhibit or schedule.
SECTION 3.14 LABOR MATTERS. As of the date hereof and the Closing Date,
there are no strikes, lockouts or slowdowns against any Company pending or, to
the knowledge of any Company, threatened. The hours worked by and payments made
to employees of any Company have not been in violation of the Fair Labor
Standards Act or any other applicable federal, state, local or foreign law
dealing with such matters in any manner which could reasonably be expected to
result in a Material Adverse Effect. All payments due from any Company, or for
which any claim may be made against any Company, on account of wages and
employee health and welfare insurance and other benefits, have been paid or
accrued as a liability on the books of such Company except where the failure to
do so could not reasonably be expected to result in a Material Adverse Effect.
The consummation of the Transactions will not give rise to any right of
termination or right of renegotiation on the part of any union under any
collective bargaining agreement to which any Company is bound.
SECTION 3.15 SOLVENCY. Immediately after the consummation of the
Transactions to occur on the Closing Date and immediately following the making
of each Loan and after giving effect to the application of the proceeds of each
Loan taking into account rights of contribution against or reimbursement from
other Loan Parties, (a) the fair value of the assets of each Loan Party
(individually and on a consolidated basis with its Subsidiaries) will exceed its
debts and liabilities, subordinated, contingent or otherwise; (b) the present
fair saleable value of the Property of each Loan Party (individually and on a
consolidated basis with its Subsidiaries) will be greater than the amount that
will be required to pay the probable liability of its debts and other
liabilities, subordinated, contingent or otherwise, as such debts and other
liabilities become
82
absolute and matured; (c) each Loan Party (individually and on a consolidated
basis with its Subsidiaries) will be able to pay its debts and liabilities,
subordinated, contingent or otherwise, as such debts and liabilities become
absolute and matured; and (d) each Loan Party (individually and on a
consolidated basis with its Subsidiaries) will not have unreasonably small
capital with which to conduct its business in which it is engaged as such
business is now conducted and is proposed to be conducted following the Closing
Date and (e) with respect to any Canadian Loan Party, that on such date (i) the
property of such Person is sufficient, if disposed of at a fairly conducted sale
under legal process, to enable payment of all its obligations, due and accruing
due, (ii) the property of such Person is, at a fair valuation, greater than the
total amount of liabilities, including contingent liabilities, of such Person,
(iii) such Person has not ceased paying its current obligations in the ordinary
course of business as they generally become due, and (iv)) such Person is not
for any reason unable to meet its obligations as they generally become due. In
determining the foregoing, the amount of contingent liabilities (such as
litigation, guaranties and pension plan liabilities) at any time shall be
computed as the amount that, in light of all the facts and circumstances
existing at the time, represents the amount that can be reasonably be expected
to become an actual or matured liability.
SECTION 3.16 EMPLOYEE BENEFIT AND PENSION PLANS. (a) Each Domestic
Company and its ERISA Affiliates is in compliance in all material respects with
the applicable provisions of ERISA and the Code and the regulations and
published interpretations thereunder. No ERISA Event has occurred or is
reasonably expected to occur that, when taken together with all other such ERISA
Events, could reasonably be expected to result in material liability of any
Domestic Company or any of its ERISA Affiliates or the imposition of a Lien on
any of the assets of a Domestic Company. As of the date of the most recent
financial statements, there is no accumulated funding deficiency (as defined by
Section 412(a) of the Code). Each Company and its ERISA Affiliates are in
compliance with the terms of the July 1999 agreement (and any amendments or
related letters) between Holdings and the PBGC that addresses the Plans. Using
actuarial assumptions and computation methods consistent with subpart 1 of
subtitle E of Title IV of ERISA, the aggregate liabilities of each Company or
its ERISA Affiliates to all Multiemployer Plans in the event of a complete
withdrawal therefrom, as of the close of the most recent fiscal year of each
such Multiemployer Plan, could not reasonably be expected to result in a
Material Adverse Effect.
(b) Except as set forth in Schedule 3.16, the Canadian Pension Plans
are duly registered under the ITA and all other applicable laws which require
registration and no event has occurred which is reasonably likely to cause the
loss of such registered status. All material obligations of any Canadian Loan
Party (including fiduciary, funding, investment and administration obligations)
required to be performed in connection with the Canadian Pension Plans and the
funding agreements therefor have been performed in a timely fashion. There have
been no improper withdrawals or applications of the assets of the Canadian
Pension Plans or the Canadian Benefit Plans. There are no outstanding disputes
concerning the assets of the Canadian Pension Plans or the Canadian Benefit
Plans. Each of the Canadian Pension Plans is fully funded in accordance with the
contribution schedules determined by the Plan actuary (using actuarial methods
and assumptions which are consistent with the valuations last filed with the
applicable governmental authorities and which are consistent with generally
accepted actuarial principles). General Cable Canada does not employ any
employees outside of Canada.
83
(c) Each Foreign Plan has been maintained in substantial compliance
with its terms and with the requirements of any and all applicable laws,
statutes, rules, regulations and orders and has been maintained, where required,
in good standing with applicable regulatory authorities. No Foreign Company has
incurred any material obligation in connection with the termination of or
withdrawal from any Foreign Plan. Each Foreign Plan is funded in accordance with
the contribution schedule determined by the Plan actuary (using actuarial
methods and assumptions which are consistent with the valuations last filed with
the applicable Governmental Authority and which are consistent with generally
accepted actuarial principles). For each Foreign Plan which is not funded, the
obligations of such Foreign Plan are properly accrued.
SECTION 3.17 ENVIRONMENTAL MATTERS. (a) Except as set forth in Schedule
3.17 or except as, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect:
(i) The Companies and their businesses, operations and
Real Property are and in the last six years have been in compliance with, and
the Companies have no liability under, Environmental Law;
(ii) The Companies have obtained all Environmental Permits
required for the conduct of their businesses and operations, and the ownership,
operation and use of their assets, under Environmental Law, all such
Environmental Permits are valid and in good standing and, under the currently
effective business plan of the Companies, no expenditures or operational
adjustments will be required in order to renew or modify such Environmental
Permits during the next five years;
(iii) There has been no Release or threatened Release of
Hazardous Material on, at, under or from any real Property or facility presently
or formerly owned, leased or operated by the Companies or their predecessors in
interest that could result in liability of the Companies under Environmental
Law;
(iv) There is no Environmental Claim pending or, to the
knowledge of the Companies, threatened against the Companies, or relating to the
real Property currently or formerly owned, leased or operated by the Companies
or relating to the operations of the Companies, and there are no actions,
activities, circumstances, conditions, events or incidents that could form the
basis of such an Environmental Claim; and
(v) No Person with an indemnity or contribution
obligation to the Companies relating to compliance with or liability under
Environmental Law is in default with respect to such obligation.
(b) Except as set forth in Schedule 3.17 or except as, individually or
in the aggregate could not reasonably be expected to result in a Material
Adverse Effect:
(i) No Company is obligated to perform any action or
otherwise incur any expense under Environmental Law pursuant to any order,
decree, judgment or agreement by which it is bound or has assumed by contract or
agreement, and no Company is conducting or financing any Response pursuant to
any Environmental Law with respect to any Real Property or any other location;
84
(ii) No Real Property or facility owned, operated or
leased by the Companies and, to the knowledge of the Companies, no real Property
or facility formerly owned, operated or leased by the Companies or any of their
predecessors in interest is (x) listed or proposed for listing on the National
Priorities List promulgated pursuant to CERCLA or (y) listed on the
Comprehensive Environmental Response, Compensation and Liability Information
System promulgated pursuant to CERCLA or (z) included on any similar list
maintained by any Governmental Authority including, without limitation, any such
list relating to petroleum;
(iii) No Lien has been recorded or, to the knowledge of any
Company, threatened under any Environmental Law with respect to any Real
Property or assets of the Companies;
(iv) The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby will not
require any notification, registration, filing, reporting, disclosure,
investigation, remediation or cleanup pursuant to any Governmental Real Property
Disclosure Requirements or any other Environmental Law; and
(v) The Companies have made available to Lenders all
material reports and assessments in the possession, custody or control of, or
otherwise reasonably available to, the Companies concerning compliance with or
liability under Environmental Law at the properties owned within the United
States, which reports may concern the existence of Hazardous Material at such
properties.
SECTION 3.18 INSURANCE. Schedule 3.18 sets forth a true, complete and
correct description of all insurance maintained by each Company as of the
Closing Date. As of each such date, such insurance is in full force and effect
and all premiums have been duly paid. Each Company has insurance in such amounts
and covering such risks and liabilities as are in accordance with normal
industry practice.
SECTION 3.19 SECURITY DOCUMENTS. (a) The Security Agreements are
effective to create in favor of the Collateral Agent for the benefit of the
Secured Parties, a legal, valid and enforceable security interest in and Lien on
the Security Agreement Collateral and, when (i) financing statements and other
filings in appropriate form are filed in the offices specified on Schedule 4 to
the Perfection Certificate and (ii) upon the taking of possession or control by
the Collateral Agent of the Security Agreement Collateral with respect to which
a security interest may be perfected only by possession or control (which
possession or control shall be given to the Collateral Agent to the extent
possession or control by the Collateral Agent is required by each Security
Agreement), the Lien created by the Security Agreements shall constitute a fully
perfected Lien on, and security interest in, all right, title and interest of
the grantors thereunder in the Security Agreement Collateral (other than such
Security Agreement Collateral in which a security interest cannot be perfected
under the UCC or PPSA as in effect at the relevant time in the relevant
jurisdiction), in each case subject to no Liens other than Permitted Liens.
(b) When the Security Agreements or a short form thereof is filed in
the United States Patent and Trademark Office and the United States Copyright
Office, Canadian Intellectual Property Office, as applicable, the Lien created
by such Security Agreements shall constitute a fully perfected Lien on, and
security interest in, all right, title and interest of the grantors
85
thereunder in the Intellectual Property (as defined in such Security
Agreements), in each case subject to no Liens other than Permitted Liens.
(c) Each Mortgage executed and delivered as of the Closing Date is, or,
to the extent any Mortgage is duly executed and delivered thereafter by the
relevant Loan Party, will be, effective to create, in favor of the Collateral
Agent, for its benefit and the benefit of the Secured Parties, a legal, valid
and enforceable first priority Lien on and security interest in all of the Loan
Parties' right, title and interest in and to the Mortgaged Real Properties
thereunder and the proceeds thereof, and when the Mortgages are filed in the
offices specified on Schedule 1.01(a), (or, in the case of any Mortgage executed
and delivered after the date thereof in accordance with the provisions of
Sections 5.11 and 5.12, when such Mortgage is filed in the offices specified in
the local counsel opinion delivered with respect thereto in accordance with the
provisions of Sections 5.11 and 5.12) the Mortgages shall constitute fully
perfected Liens on, and security interests in, all right, title and interest of
the Loan Parties in the Mortgaged Real Properties and the proceeds thereof, in
each case prior and superior in right to any other Person, other than Liens
reasonably acceptable to the Administrative Agent and the Collateral Agent.
(d) Each Security Document delivered pursuant to Sections 5.11 and 5.12
will, upon execution and delivery thereof, be effective to create in favor of
the Collateral Agent, for the benefit of the Secured Parties, a legal, valid and
enforceable security interest in and Lien on all of the Loan Parties' right,
title and interest in and to the Collateral thereunder, and when all appropriate
filings or recordings are made in the appropriate offices as may be required
under applicable law, such Security Document will constitute a fully perfected
Lien on, and security interest in, all right, title and interest of the Loan
Parties in such Collateral, in each case subject to no Liens other than the
applicable Permitted Liens.
SECTION 3.20 EQUITY FINANCING DOCUMENTS; REPRESENTATIONS AND WARRANTIES
IN AGREEMENT. (a) The Lenders have been furnished true and complete copies of
each Equity Financing Document to the extent executed and delivered on or prior
to the Closing Date.
(b) All representations and warranties of each Company set forth in the
Equity Financing Documents were true and correct in all material respects as of
the time such representations and warranties were made and shall be true and
correct in all material respects as of the Closing Date as if such
representations and warranties were made on and as of such date, unless stated
to relate to a specific earlier date, in which case such representations and
warranties shall be true and correct in all material respects as of such earlier
date.
SECTION 3.21 [INTENTIONALLY OMITTED.]
SECTION 3.22 LOCATION OF MATERIAL INVENTORY. Schedule 3.22 sets forth
all locations in the United States and Canada where the aggregate value of
Inventory owned by the Loan Parties exceeds the Dollar Equivalent of $250,000.
SECTION 3.23 ACCURACY OF BORROWING BASE. At the time any Borrowing
Base Certificate is delivered pursuant to this Agreement, (a) each Account and
each item of Inventory included in the calculation of the Borrowing Base
satisfies all of the criteria stated herein (or of which Borrower has hereafter
been notified by Collateral Agent under Section 2.19) to be an
86
Eligible Account and an item of Eligible Inventory, respectively, (b) each item
of Equipment included in the calculation of the Borrowing Base satisfies all of
the criteria stated herein to be an Eligible Equipment and (c) each parcel of
Real Property included in the calculation of the Borrowing Base satisfies all of
the criteria stated herein satisfies all of the criteria stated herein to be an
Eligible Real Property.
SECTION 3.24 POST-AUDIT ASSET DISPOSITIONS. As of the Closing Date, the
Borrower and the other Loan Parties have not disposed of assets (other than
Inventory sold in the ordinary course of their business) which are set forth in
the Inventory Appraisal, Equipment appraisal or Real Property appraisals and
which have an aggregate fair market value of more than the Dollar Equivalent of
$250,000.
SECTION 3.25 HOLDING COMPANIES; INACTIVE SUBSIDIARIES. (a) Except for
the ownership of interests in Real Property set forth in Schedule 6.18, no
Holding Company (i) engages in any trade or business other than providing
administrative and managerial services on behalf of the Companies, (ii) owns any
assets (other than Equity Interests and Indebtedness, including intercompany
Indebtedness, which are pledged to the Collateral Agent on the Closing Date) or
(iii) has any liabilities (other than for the Obligations, intercompany
Indebtedness and the Indebtedness evidenced by the Qualified Senior Notes) in an
aggregate amount that exceeds $25,000.
(b) No Domestic or Canadian Inactive Subsidiary (i) has assets
with an aggregate book value in excess of $25,000 other than Indebtedness and
Equity Interests on the Closing Date pledged to the Collateral Agent, (ii) has
any liabilities (other than for the Obligations, intercompany Indebtedness and
the Indebtedness evidenced by the Qualified Senior Notes) in an aggregate amount
that exceeds $25,000 or (iii) engages in any trade or business.
SECTION 3.26 COMMON ENTERPRISE. Holdings is the direct or indirect and
beneficial owner and holder of all of the issued and outstanding shares of stock
or other Equity Interests in the Borrower and the other Guarantors. Borrower and
Guarantors make up a related organization of various entities constituting a
single economic and business enterprise so that Borrower and Guarantors share a
substantial identity of interests such that any benefit received by any one of
them benefits the others. Borrower and certain Guarantors render services to or
for the benefit of Borrower and/or the other Guarantors, as the case may be,
purchase or sell and supply goods to or from or for the benefit of the others,
make loans, advances and provide other financial accommodations to or for the
benefit of Borrower and Guarantors (including, inter alia, the payment by
Borrower and Guarantors of creditors of the Borrower or Guarantors and
guarantees by Borrower and Guarantors of indebtedness of Borrower and Guarantors
and provide administrative, marketing, payroll and management services to or for
the benefit of Borrower and Guarantors). Borrower and Guarantors have
centralized accounting, common officers and directors and are in certain
circumstances are identified to creditors as a single economic and business
enterprise (i.e., as Holdings' "domestic" business).
87
ARTICLE IV.
CONDITIONS TO CREDIT EXTENSIONS
SECTION 4.01 CONDITIONS TO INITIAL CREDIT EXTENSION. The obligation of
each Lender and, if applicable, each Issuing Bank to fund the initial Credit
Extension requested to be made by it shall be subject to the prior or concurrent
satisfaction of each of the conditions precedent set forth in this Section 4.01.
(a) Loan Documents. All legal matters incident to this Agreement, the
Borrowings and extensions of credit hereunder and the other Loan Documents shall
be satisfactory to the Lenders, to the Issuing Bank and to the Administrative
Agent and there shall have been delivered to the Administrative Agent an
executed counterpart of each of the Loan Documents, including this Agreement,
the Security Agreements, the Foreign Guaranties, the Foreign Pledge Agreements,
Canadian Pledge Agreements, each Mortgage, the Perfection Certificate and each
other applicable Loan Document.
(b) Corporate Documents. The Administrative Agent and Collateral Agent
shall have received:
(i) a certificate of the Secretary or Assistant Secretary
of each Loan Party dated the Closing Date and certifying (A) that attached
thereto is a true and complete copy of the certificate or articles of
incorporation or other constitutive documents, including all amendments thereto
certified as of a recent date by the Secretary of State of the state of its
organization, (B) that attached thereto is a true and complete copy of the
by-laws of such Loan Party as in effect on the Closing Date and at all times
since a date prior to the date of the resolutions described in clause (C) below,
(C) that attached thereto is a true and complete copy of resolutions duly
adopted by the Board of Directors of such Loan Party authorizing the execution,
delivery and performance of the Loan Documents to which such Person is a party
and, in the case of Borrower, the borrowings hereunder, and that such
resolutions have not been modified, rescinded or amended and are in full force
and effect, (D) as to the incumbency and specimen signature of each officer
executing any Loan Document or any other document delivered in connection
herewith on behalf of such Loan Party (together with a certificate of another
officer as to the incumbency and specimen signature of the Secretary or
Assistant Secretary executing the certificate in this clause (i));
(ii) a long form certificate as to the good standing of
each Loan Party as of a recent date, from such Secretary of State; and
(iii) such other documents as the Lenders, the Issuing Bank
or the Administrative Agent may reasonably request.
(c) Officers' Certificate. The Administrative Agent and Collateral
Agent shall have received a certificate, dated the Closing Date and signed by
the Chief Executive Officer and the Chief Financial Officer of Borrower,
confirming compliance with the conditions precedent set forth in Section 4.01
and paragraphs (b), (c), (d) and (e) of Section 4.02.
88
(d) Financings and Other Transactions, Etc.
(i) The Administrative Agent and the Collateral Agent
shall have verified that Borrower shall have received not less than $275.0
million gross proceeds from the issuance and sale of the Qualified Senior Notes.
(ii) The Administrative Agent and the Collateral Agent
shall have verified that Borrower shall have received at least $125.0 million
gross proceeds from the Equity Financing.
(iii) The Refinancing shall have been consummated in full
to the satisfaction of the Lenders with all liens in favor of the existing
lenders being unconditionally released; the Administrative Agent shall have
received a "pay-off" letter with respect to all debt being refinanced in the
Refinancing; the Collateral Agent shall have received from any Person holding
any Lien securing any such debt, such UCC termination statements, mortgage
releases, releases of assignments of leases and rents and other instruments, in
each case in proper form for recording, as the Collateral Agent shall have
reasonably requested to release and terminate of record the Liens securing such
debt.
(e) Financial Statements; Balance Sheet; Projections. The Lenders shall
have received and shall be satisfied with the form and substance of the
financial statements described in Section 3.04 and with the forecasts of the
Borrowing Base and the financial performance of Holdings, Borrower and their
respective Subsidiaries.
(f) Indebtedness; Preferred Stock and Minority Interests. After giving
effect to the Transactions and the other transactions contemplated hereby, no
Company shall have outstanding any Indebtedness for borrowed money, preferred
stock or minority interests other than (i) the Loans and extensions of credit
hereunder, (ii) the Qualified Senior Notes, (iii) Convertible Preferred Stock,
(iv) up to the Dollar Equivalent of $1.0 million of Capital Lease Obligations
and the other Indebtedness listed on Schedule 6.01, (v) minority interests in
NextGen and (vi) Indebtedness owed to Borrower or any Guarantor.
(g) Opinions of Counsel. The Administrative Agent and Collateral Agent
shall have received, on behalf of themselves, the Arrangers, the Lenders and the
Issuing Bank, a favorable written opinion of (i) Blank Rome LLP, special counsel
for the Loan Parties, substantially to the effect set forth in Exhibit K-1 and
(ii) each local and foreign counsel listed on Schedule 4.01(g), substantially to
the effect set forth in Exhibit K-2, Exhibit K-3 or Exhibit K-4, as applicable,
in each case (A) dated the Closing Date, (B) addressed to the Administrative
Agent, the Collateral Agent, the Issuing Bank and the Lenders and (C) covering
such other matters relating to the Loan Documents and the Transactions as the
Administrative Agent shall reasonably request.
(h) Solvency Opinion and Other Reports. (i) The Lenders shall have
received all reports and opinions of appraisers, consultants or other advisors
retained by it to review the business, operation or condition of Holdings and
the other Companies giving effect to the Transactions, and shall be satisfied
with such reports and opinions.
(ii) The Administrative Agent shall have received a
solvency certificate in the form of Exhibit M, dated the Closing Date and signed
by the Chief Financial Officer of Holdings.
89
(i) Requirements of Law. The Lenders shall be satisfied that the
Transactions shall be in full compliance with all material Requirements of Law,
including without limitation Regulations T, U and X of the Board. The Lenders
shall have received satisfactory evidence of compliance with all applicable
Requirements of Law, including all applicable environmental laws and
regulations.
(j) Consents. The Lenders shall be satisfied that all requisite
Governmental Authorities and third parties shall have approved or consented to
the Transactions, and there shall be no governmental or judicial action, actual
or threatened, that has or would have, singly or in the aggregate, a reasonable
likelihood of restraining, preventing or imposing burdensome conditions on the
Transactions or the other transactions contemplated hereby.
(k) Litigation. There shall be no litigation, public or private, or
administrative proceedings, governmental investigation or other legal or
regulatory developments, actual or threatened, that, singly or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect, or could
materially and adversely affect the ability of Holdings, Borrower and the
Subsidiaries to fully and timely perform their respective obligations under the
Transaction Documents, or the ability of the parties to consummate the
financings contemplated hereby or the other Transactions.
(l) Sources and Uses. The sources and uses of the Loans shall be as set
forth in Section 3.11.
(m) Fees. The Arrangers, Collateral Agent and Administrative Agent
shall have received all Fees and other amounts due and payable on or prior to
the Closing Date, including, to the extent invoiced, reimbursement or payment of
all out-of-pocket expenses (including reasonable legal fees and expenses of
Xxxxxx & Xxxxxxx, LLP, special counsel to the Administrative Agent and the
Collateral Agent, and the fees and expenses of any local counsel, appraisers,
consultants and other advisors) required to be reimbursed or paid by Borrower
hereunder or under any other Loan Document.
(n) Personal Property Requirements. The Collateral Agent shall have
received:
(i) all certificates, agreements or instruments
representing or evidencing the Pledged Equity Interests and the Pledged Notes
(each as defined in the Security Agreement) accompanied by instruments of
transfer and stock powers endorsed in blank shall have been delivered to the
Collateral Agent;
(ii) all other certificates, agreements, including control
agreements, or instruments necessary to perfect the Collateral Agent's security
interest in all Chattel Paper, all Instruments, all deposit accounts and all
Investment Property of each Loan Party (as each such term is defined in the
Security Agreements and to the extent required by Section 3.3 of the Security
Agreement);
(iii) UCC financing statements in appropriate form for
filing under the UCC, filings with the United States Patent, Trademark and
Copyright offices and such other documents under applicable Requirements of Law
in each jurisdiction as may be necessary or appropriate or, in the opinion of
the Collateral Agent, desirable to perfect the Liens created, or purported to
90
be created, by the Security Documents and, with respect to all UCC or PPSA
financing statements required to be filed pursuant to the Loan Documents,
evidence satisfactory to the Administrative Agent and the Collateral Agent that
such financing statements were filed and remain on file.
(iv) certified copies of UCC, PPSA, tax and judgment lien
searches, bankruptcy and pending lawsuit searches or equivalent reports or
searches, each of a recent date listing all effective financing statements, lien
notices or comparable documents that name any Loan Party as debtor and that are
filed in those state, county or provincial jurisdictions in which any Property
of any Loan Party is located and the state, county or provincial jurisdictions
in which any Loan Party is organized or maintains its principal place of
business and such other searches that the Collateral Agent deems necessary or
appropriate, none of which encumber the Collateral covered or intended to be
covered by the Security Documents (other than Permitted Liens and those relating
to Liens acceptable to the Collateral Agent);
(v) with respect to each Real Property set forth on
Schedule 4.01(n), a Landlord Lien Waiver and Access Agreement; and
(vi) evidence acceptable to the Collateral Agent of
payment by the Loan Parties of all applicable recording taxes, fees, charges,
costs and expenses required for the recording of the Security Documents.
(o) Real Property Requirements. The Collateral Agent shall have
received:
(i) a Mortgage encumbering each Mortgaged Real Property
in favor of Collateral Agent, for the benefit of the Secured Parties, duly
executed and acknowledged by each Loan Party that is the owner of or holder of
any interest in such Mortgaged Real Property, and otherwise in form for
recording in the recording office of each political subdivision where each such
Mortgaged Real Property is situated, together with such certificates,
affidavits, questionnaires or returns as shall be required in connection with
the recording or filing thereof to create a lien under applicable law, and such
UCC-1 or PPSA financing statements, all of which shall be in form and substance
reasonably satisfactory to Collateral Agent, and any other instruments necessary
to grant a mortgage lien under the laws of any applicable jurisdiction;
(ii) with respect to each Mortgaged Real Property, such
consents, approvals, amendments, supplements, estoppels, tenant subordination
agreements or other instruments as necessary or required to consummate the
Transactions or as shall reasonably be deemed necessary by the Collateral Agent
in order for the owner or holder of the fee or leasehold interest constituting
such Mortgaged Real Property to grant the Lien contemplated by the Mortgage with
respect to such Mortgaged Real Property;
(iii) with respect to each Mortgage, a policy (or
commitment to issue a policy) of title insurance insuring (or committing to
insure) the Lien of such Mortgage as a valid first mortgage Lien on the
Mortgaged Real Property (except for the Lien of the Mortgage with respect to the
Real Property located in Altoona, Pennsylvania shall be a second mortgage Lien)
and fixtures described therein in the amount set forth on Schedule 4.01(o)(iii)
hereto with respect to such Mortgaged Real Property (being 110% of the fair
market value of such Mortgaged Real
91
Property) which policies (or commitments) (each, a "TITLE POLICY") shall (A) be
issued by the Title Company, (B) to the extent necessary, include such
reinsurance arrangements (with provisions for direct access, if necessary) as
shall be reasonably acceptable to the Collateral Agent, (C) contain a "tie-in"
or "cluster" endorsement (if available under applicable law) (i.e., policies
which insure against losses regardless of location or allocated value of the
insured Property up to a stated maximum coverage amount), (D) have been
supplemented by such endorsements (or zoning letters to the extent obtained by
Loan Parties) as shall be reasonably requested by the Collateral Agent
(including, without limitation, endorsements on matters relating to usury, last
dollar, zoning, contiguity, revolving credit, doing business, non-imputation,
public road access, survey, variable rate, environmental lien and so-called
comprehensive coverage over covenants and restrictions), and (E) contain no
exceptions to title other than exceptions acceptable to the Collateral Agent;
(iv) with respect to each Mortgaged Real Property, such
affidavits, certificates, information (including financial data) and instruments
of indemnification (including, without limitation, a so-called "gap"
indemnification) as shall be required to induce the Title Company to issue the
Title Policies (or commitment) and endorsements contemplated in subparagraph
(iii) above;
(v) evidence reasonably acceptable to the Collateral
Agent of payment by Borrower of all Title Policy premiums, search and
examination charges, and related charges, mortgage recording taxes, fees,
charges, costs and expenses required for the recording of the Mortgages and
issuance of the Title Policies referred to subparagraph (iii) above;
(vi) with respect to each Real Property or Mortgaged Real
Property, copies of all Leases in which Borrower or any Subsidiary holds the
lessor's interest or other agreements relating to possessory interests, if any.
To the extent any of the foregoing affect any Mortgaged Real Property, such
agreement shall be subordinate to the Lien of the Mortgage to be recorded
against such Mortgaged Real Property (except with respect to the Real Property
located in Highland Heights, Kentucky which is subject to the provisions of the
underlying ground lease), either expressly by its terms or pursuant to a
subordination, non-disturbance and attornment agreement, and shall otherwise be
acceptable to the Collateral Agent;
(vii) with respect to each Mortgaged Real Property,
Borrower and each Subsidiary shall have made all notification, registrations and
filings, to the extent required by, and in accordance with, all Governmental
Real Property Disclosure Requirements applicable to such Mortgaged Real
Property;
(viii) Surveys with respect to each Mortgaged Real Property
located in Altoona, Pennsylvania; Highland Heights, Kentucky; and Lawrenceburg,
Kentucky, such other surveys with respect to each Mortgaged Real Property
located in DuQuoin, Illinois; Jackson, Tennessee; Lincoln, Rhode Island;
Malvern, Arizona; Marshall, Texas; Marion, Indiana; South Xxxxxx, Massachusetts;
and Willimantic, Connecticut which may be dated earlier than six months prior to
their delivery but no earlier than April 1, 1999 and as long as Borrower or the
relevant Company delivers an "affidavit of no new improvements" to the Title
Company with respect to each such survey, and is otherwise in form and substance
satisfactory to the Collateral Agent, and surveys
92
with respect to each other Mortgaged Real Property, as requested by the
Collateral Agent, in its reasonable discretion;
(ix) evidence reasonably acceptable to the Collateral
Agent that no Mortgaged Real Property is located in a special flood hazard area
as designated by any federal governmental authorities other than the Real
Property in Willimantic, Connecticut, which is located in a flood hazard area
for which Borrower has obtained flood insurance.
(p) Insurance. The Administrative Agent and the Collateral Agent shall
have received a copy of, or a certificate as to coverage under, the insurance
policies required by Section 5.04 and the applicable provisions of the Security
Documents, each of which shall be endorsed or otherwise amended to include a
"standard" or "New York" lender's loss payable endorsement and to name the
Collateral Agent as additional insured, in form and substance satisfactory to
the Collateral Agent.
(q) Initial Borrowing Base Certificate and Minimum Excess Availability.
The Collateral Agent and the Administrative Agent shall have received a
Borrowing Base Certificate, dated as of the Closing Date, which Borrowing Base
Certificate shall evidence Excess Availability of no less than $60.0 million
after giving effect to the initial funding of Loans on the Closing Date and the
consummation of the other Transactions contemplated by the Transaction
Documents.
(r) Take-Over Audit. Sufficiently in advance of the Closing Date as the
Collateral Agent may determine, the Collateral Agent's staff and/or its agents
shall have conducted a supplemental "take-over audit" which supports and
confirms through the Closing Date (i) the calculation of the initial Borrowing
Base, (ii) no material change in the procedures since the delivery of the
Inventory Appraisal, (iii) no material change in sales, credit and collection
procedures, Inventory turn or the level of Inventory since the delivery of the
field audit and Inventory Appraisal and (iv) the accuracy of all representations
and warranties set forth herein.
(s) Cash Management. The Collateral Agent and the Administrative Agent
shall have received evidence that, as of the Closing Date, Cash Management
Systems complying with Section 9.01 hereof has been established and is currently
being maintained in the manner set forth in Section 9.01, together with the duly
executed Deposit Account Agreement satisfactory to the Collateral Agent.
SECTION 4.02 CONDITIONS TO ALL CREDIT EXTENSIONS. The obligation of
each Lender and each Issuing Bank to make any Credit Extension (including the
initial Credit Extension) shall be subject to, and to the satisfaction of, each
of the conditions precedent set forth below.
(a) Notice. The Administrative Agent shall have received a Borrowing
Request as required by Section 2.03 (or such notice shall have been deemed given
in accordance with Section 2.03) if Loans are being requested or, in the case of
the issuance, amendment, extension or renewal of a Letter of Credit, the Issuing
Bank and the Administrative Agent shall have received a notice requesting the
issuance, amendment, extension or renewal of such Letter of Credit as required
by Section 2.18(b) or, in the case of the Borrowing of a Swingline Loan, the
Swingline Lender and the Administrative Agent shall have received a notice
requesting such Swingline Loan as required by Section 2.17(b).
93
(b) No Default. The Borrower and each other Loan Party shall be in
compliance in all material respects with all the terms and provisions set forth
herein and in each other Loan Document on its part to be observed or performed,
and, at the time of and immediately after such Credit Extension, no Default
shall have occurred and be continuing on such date or after giving effect to the
Credit Extension requested to be made on such date.
(c) Representations and Warranties. Each of the representations and
warranties made by any Loan Party set forth in Article III hereof or in any
other Loan Document shall be true and correct in all material respects (except
that any representation and warranty that is qualified as to "materiality" or
"Material Adverse Effect" shall be true and correct in all respects) on and as
of the date of such Credit Extension with the same effect as though made on and
as of such date, except to the extent such representations and warranties
expressly relate to an earlier date.
(d) No Material Adverse Effect. There has been no event, condition
and/or contingency that has had or is reasonable likely to have a Material
Adverse Effect, as reasonably determined by either the Administrative Agent or
the Collateral Agent.
(e) No Legal Bar. No order, judgment or decree of any Governmental
Authority shall purport to restrain such Lender from making any Loans to be made
by it or the Issuing Bank from issuing Letters of Credit. No injunction or other
restraining order shall have been issued, shall be pending or noticed with
respect to any action, suit or proceeding seeking to enjoin or otherwise prevent
the consummation of, or to recover any damages or obtain relief as a result of,
the transactions contemplated by this Agreement or the making of Loans
hereunder.
Each of the delivery of a Borrowing Request or notice requesting the issuance,
amendment, extension or renewal of a Letter of Credit and the acceptance by the
Borrower of the proceeds of such Credit Extension shall constitute a
representation and warranty by Borrower and each other Loan Party that on the
date of such Credit Extension (both immediately before and after giving effect
to such Credit Extension and the application of the proceeds thereof) the
conditions contained in this Section 4.02 have been satisfied. Borrower shall
provide such information (including calculations in reasonable detail of the
covenants in Section 6.08) as the Administrative Agent or the Collateral Agent
may reasonably request to confirm that the conditions in this Section 4.02 have
been satisfied.
ARTICLE V.
AFFIRMATIVE COVENANTS
Each Loan Party covenants and agrees with each Lender that so long as
this Agreement shall remain in effect and until the Commitments have been
terminated and the principal of and interest on each Loan, all Fees and all
other expenses or amounts payable under any Loan Document shall have been paid
in full and all Letters of Credit have been canceled or have expired or been
fully cash collateralized and all amounts drawn thereunder have been reimbursed
in full, unless the Required Lenders shall otherwise consent in writing, each
Loan Party will, and will cause each of its Subsidiaries to:
94
SECTION 5.01 FINANCIAL STATEMENTS, REPORTS, ETC. In the case of
Holdings and Borrower, furnish to the Administrative Agent and each Lender:
(a) Annual Reports. Within 90 days after the end of each fiscal year
(but no later than the date on which Holdings is required to file a Form 10-K
under the Exchange Act), (i) the consolidated and consolidating (by region or,
if requested by the Collateral Agent exercising in its reasonable credit
judgment, by entity) balance sheet of Holdings as of the end of such fiscal year
and related consolidated and consolidating (by region or, if requested by the
Collateral Agent exercising in its reasonable credit judgment, by entity)
statements of income, cash flows and stockholders' equity for such fiscal year,
and notes thereto (including a note with a balance sheet and statements of
income and cash flows separating out results consistent with reporting to the
SEC), all prepared in accordance with Regulation S-X under the Securities Act
and accompanied by an opinion of Deloitte & Touche LLP or other independent
public accountants of recognized national standing satisfactory to the
Administrative Agent or one of the other "Big 4" accounting firms (which opinion
shall not be qualified as to scope or contain any going concern or other
qualification), stating that such financial statements fairly present, in all
material respects, the consolidated financial condition, results of operations,
cash flows and changes in stockholders' equity of the Consolidated Companies as
of the end of and for such fiscal year in accordance with GAAP consistently
applied, (ii) a management report in a form reasonably satisfactory to the
Administrative Agent setting forth, on a consolidating basis (by region or, if
requested by the Collateral Agent exercising in its reasonable credit judgment,
by entity), the financial condition, results of operations and cash flows of the
Consolidated Companies (on a consolidated basis) as of the end of and for such
fiscal year, as compared to the Consolidated Companies' financial condition,
results of operations and cash flows as of the end of and for the previous
fiscal year and its budgeted results of operations and cash flows, (iii) a
management's discussion and analysis of the financial condition and results of
operations for such fiscal year, as compared to the previous fiscal year and
(iv) a schedule setting forth the intercompany Indebtedness outstanding and
changes thereto since the prior fiscal year;
(b) Quarterly Reports. Within 45 days after the end of each of the
first three fiscal quarters of each fiscal year (but no later than the date on
which Holdings is required to file a Form 10-Q under the Exchange Act), (i) the
consolidated and consolidating (by region or, if requested by the Collateral
Agent exercising in its reasonable credit judgment, by entity) balance sheet of
Holdings as of the end of such fiscal quarter and related consolidated and
consolidating (by region or, if requested by the Collateral Agent exercising in
its reasonable credit judgment, by entity) statements of income and cash flows
for such fiscal quarter and for the then elapsed portion of the fiscal year, in
comparative form with the consolidated statements of income and cash flows for
the comparable periods in the previous fiscal year, and notes thereto (including
a note with a balance sheet and statements of income and cash flows separating
out results consistent with reporting to the SEC), all prepared in accordance
with Regulation S-X under the Securities Act and accompanied by a certificate of
a Financial Officer stating that such financial statements fairly present, in
all material respects, the consolidated financial condition, results of
operations and cash flows of the Consolidated Companies as of the date and for
the periods specified in accordance with GAAP consistently applied, and on a
basis consistent with audited financial statements referred to in paragraph (a)
if this Section 5.01(b), subject to normal year-end audit adjustments, (ii) a
management report in a form reasonably satisfactory to the Administrative Agent
setting forth, on a consolidating basis (by region or, if requested by the
95
Collateral Agent exercising in its reasonable credit judgment, by entity), the
financial condition, results of operations and cash flows of the Consolidated
Companies (on a consolidated basis) as of the end of and for such fiscal quarter
and for the then elapsed portion of the fiscal year, as compared to the
Consolidated Companies' financial condition, results of operations and cash
flows as of the end of such fiscal quarter and for the comparable periods in the
previous fiscal year and its budgeted results of operations and cash flows,
(iii) a management's discussion and analysis of the financial condition and
results of operations for such fiscal quarter and the then elapsed portion of
the fiscal year, as compared to the comparable periods in the previous fiscal
year and (iv) a schedule setting forth the intercompany Indebtedness outstanding
and changes thereto since the fiscal quarter;
(c) Monthly Reports. Within 30 days after the end of each month, the
consolidated balance sheet of Holdings as of the end of such month and related
consolidated statements of income and cash flows of Holdings for such month and
for the then elapsed portion of the fiscal year, in comparative form with the
consolidated statements of income and cash flows for the comparable periods in
the previous fiscal year, accompanied by a certificate of a Financial Officer
stating that such financial statements fairly present, in all material respects,
the consolidated results of operations and cash flows of the Consolidated
Companies as of the date and for the periods specified in accordance with GAAP
consistently applied, subject to normal year-end audit adjustments, and setting
forth, on a consolidating basis (by region or, if requested by the Collateral
Agent exercising in its reasonable credit judgment, by entity), the results of
operations and cash flows for such month and for the then elapsed portion of the
fiscal year, as compared to its results of operations and cash flows for the
comparable periods in the previous fiscal year and its budgeted results of
operations and cash flows and a schedule setting forth the intercompany
Indebtedness outstanding and changes thereto since the prior month;
(d) Financial Officer's Certificate. (i) Concurrently with any delivery
of financial statements under paragraphs (a), (b) or (c) above, a certificate of
a Financial Officer certifying that no Default has occurred or, if such a
Default has occurred, specifying the nature and extent thereof and any
corrective action taken or proposed to be taken with respect thereto; (ii)
concurrently with any delivery of financial statements under sub-paragraph (a)
or (b) above, a Compliance Certificate; and (iii) in the case of paragraph (a)
above, a report of the accounting firm opining on or certifying such financial
statements stating that in the course of its regular audit of the financial
statements of Holdings and its Subsidiaries, which audit was conducted in
accordance with GAAP, such accounting firm obtained no knowledge that any
Default has occurred or, if in the opinion of such accounting firm such a
Default has occurred, specifying the nature and extent thereof;
(e) Financial Officer's Certificate Regarding Collateral. Concurrently
with any delivery of financial statements under paragraph (a) above, a
certificate of a Financial Officer setting forth the information required
pursuant to the Perfection Certificate or confirming that there has been no
change in such information since the date of the Perfection Certificate or
Supplement;
(f) Public Reports. Promptly after the same become publicly available,
copies of all periodic and other reports, proxy statements and other materials
filed by any Company with the Securities and Exchange Commission, or any
Governmental Authority succeeding to any or all of the functions of said
Commission, or with any national securities exchange, or distributed to
96
holders of its Indebtedness pursuant to the terms of the documentation governing
such Indebtedness (or any trustee, agent or other representative therefor), as
the case may be;
(g) Management Letters. Promptly after the receipt thereof by any
Company, a copy of any "management letter" received by any such Person from its
certified public accountants and the management's responses thereto;
(h) Budgets. No later than January 1, 2004 for the fiscal year of
Holdings and Borrower ending on December 31, 2004, and no later than 15 days
prior to the first day of each subsequent fiscal year of Holdings and Borrower,
a budget in form reasonably satisfactory to the Administrative Agent and the
Collateral Agent (including budgeted statements of income by each of Borrower's
business units and sources and uses of cash and balance sheets) prepared by each
of Holdings and Borrower, respectively, for (i) each fiscal month of such fiscal
year prepared in detail and (ii) each of the two years immediately following
such fiscal year prepared in summary form, in each case, of Holdings, Borrower
and their respective Subsidiaries, with appropriate presentation and discussion
of the principal assumptions upon which such budgets are based, accompanied by
the statement of a Financial Officer of each of Holdings and Borrower to the
effect that the budget of Holdings and Borrower, respectively, is a reasonable
estimate for the period covered thereby;
(i) Annual Meetings with Lenders. Within 120 days after the close of
each fiscal year of Holdings, Holdings and Borrower shall, at the request of the
Administrative Agent or Required Lenders, hold a meeting (at a mutually
agreeable location and time) with all Lenders who choose to attend such meeting
at which meeting shall be reviewed the financial results of the previous fiscal
year and the financial condition of the Companies and the budgets presented for
the current fiscal year of the Companies; and
(j) Other Information. Promptly, from time to time, such other
information regarding the operations, business affairs and financial condition
of any Company, or compliance with the terms of any Loan Document, as the
Administrative Agent or any Lender may reasonably request.
SECTION 5.02 LITIGATION AND OTHER NOTICES. Furnish to the
Administrative Agent, the Collateral Agent and each Lender prompt written notice
of the following:
(a) any Default, specifying the nature and extent thereof and the
corrective action (if any) taken or proposed to be taken with respect thereto;
(b) the filing or commencement of, or to the knowledge of any Company,
any threat or notice of intention of any Person to file or commence, any action,
suit or proceeding, whether at law or in equity by or before any Governmental
Authority, (i) against any Company or any Affiliate thereof that could
reasonably be expected to result in a Material Adverse Effect or (ii) with
respect to any Loan Document;
(c) any event that has resulted in, or could reasonably be expected to
result in a Material Adverse Effect;
97
(d) the occurrence of a Casualty Event which is reasonably likely to
result in a loss or damage in excess of $100,000 and will ensure that the Net
Cash Proceeds of any Casualty Event (whether in the form of insurance proceeds,
condemnation awards or otherwise) are collected and applied in accordance with
the applicable provisions of this Agreement and the Security Documents;
(e) (i) the incurrence of any material Lien (other than Permitted
Liens) on, or claim asserted against any of the Collateral or (ii) the
occurrence of any other event which could materially affect the value of the
Collateral; and
(f) any threatened indictment by any Governmental Authority of any Loan
Party, as to which any Loan Party receives knowledge or notice, under any
criminal or civil proceedings against any Loan Party pursuant to which statute
or proceedings the penalties or remedies sought or available include forfeiture
of (i) any of the Collateral having a value in excess of $1.0 million or (ii)
any other Property of any Loan Party which is necessary or material to the
conduct of its business.
SECTION 5.03 EXISTENCE; BUSINESSES AND PROPERTIES. (a) Do or cause to
be done all things necessary to preserve, renew and keep in full force and
effect its legal existence, except as otherwise expressly permitted under
Section 6.05 or, in the case of any Subsidiary, where the failure to perform
such obligations, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.
(b) Do or cause to be done all things necessary to obtain, preserve,
renew, extend and keep in full force and effect the rights, licenses, permits,
franchises, authorizations, patents, copyrights, trademarks and trade names
material to the conduct of its business; maintain and operate such business in
substantially the manner in which it is presently conducted and operated; comply
with all applicable Requirements of Law (including any and all zoning, building,
Environmental Law, ordinance, code or approval or any building permits or any
restrictions of record or agreements affecting the Real Property) and decrees
and orders of any Governmental Authority, whether now in effect or hereafter
enacted, except where the failure to comply, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect; pay and
perform its obligations under all Leases and Transaction Documents; and at all
times maintain and preserve all Property material to the conduct of the business
of any Loan Party and keep such Property in good repair, working order and
condition and from time to time make, or cause to be made, all needful and
proper repairs, renewals, additions, improvements and replacements thereto
necessary in order that the business of any Loan Party carried on in connection
therewith may be properly conducted at all times; provided, that nothing in this
Section 5.03(b) shall prevent (i) sales of assets, consolidations or mergers by
or involving any Company in accordance with Section 6.05; (ii) the withdrawal by
any Company of its qualification as a foreign corporation in any jurisdiction
where such withdrawal, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect; or (iii) the abandonment by any
Company of any rights, franchises, licenses, trademarks, tradenames, copyrights
or patents that such Person reasonably determines are not useful to its
business.
SECTION 5.04 INSURANCE. (a) Keep its insurable Property adequately
insured at all times by financially sound and reputable insurers (provided, that
Borrower shall not be deemed to
98
breach this provision if, after its insurer becomes unsound or irreputable,
Borrower promptly and diligently obtains adequate insurance from an alternative
carrier); maintain such other insurance, to such extent and against such risks,
including fire and other risks insured against by extended coverage, as is
customary with companies in the same or similar businesses operating in the same
or similar locations, including public liability insurance against claims for
personal injury or death or Property damage occurring upon, in, about or in
connection with the use of any Property owned, occupied or controlled by it; and
maintain such other insurance as may be required by law; and, with respect to
the Collateral, otherwise maintain all insurance coverage required under each
applicable Security Document, such policies to be in such form and amounts and
having such coverage as may be reasonably satisfactory to the Collateral Agent,
it being agreed that the levels of insurance in place on the Closing Date,
absent a material change in the Property of the Loan Parties, shall be
satisfactory to the Collateral Agent so long as appropriate steps are taken to
assure that such insurance coverage is also obtained for any future
Subsidiaries.
(b) All such insurance shall (i) provide that no cancellation thereof
shall be effective until at least 30 days after receipt by the Collateral Agent
of written notice thereof, (ii) name the Collateral Agent as mortgagee (in the
case of Property insurance) or additional insured (in the case of liability
insurance) or loss payee (in the case of casualty insurance), as applicable,
(iii) if reasonably requested by the Collateral Agent, include a breach of
warranty clause and (iv) be reasonably satisfactory in all other respects to the
Collateral Agent.
(c) Notify the Collateral Agent immediately whenever any separate
insurance concurrent in form or contributing in the event of loss with that
required to be maintained under this Section 5.04 is taken out by any Company;
and promptly deliver to the Collateral Agent a duplicate original copy of such
policy or policies.
(d) Obtain flood insurance in such total amount as the Collateral Agent
or the Required Lenders may from time to time reasonably require, if at any time
the area in which any improvements located on any real Property covered by a
Mortgage is designated a "flood hazard area" in any Flood Insurance Rate Map
published by the Federal Emergency Management Agency (or any successor agency),
and otherwise comply with the National Flood Insurance Program as set forth in
the Flood Disaster Protection Act of 1975, as amended from time to time.
(e) Deliver to the Administrative Agent and the Collateral Agent a
report of a reputable insurance broker with respect to such insurance and such
supplemental reports with respect thereto as the Administrative Agent or the
Collateral Agent may from time to time reasonably request.
SECTION 5.05 OBLIGATIONS AND TAXES. (a) Pay its Indebtedness and other
obligations promptly and in accordance with their terms and pay and discharge
promptly when due all Taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits or in respect of its Property,
before the same shall become delinquent or in default, as well as all lawful
claims for labor, materials and supplies or otherwise that, if unpaid, might
give rise to a Lien other than a Permitted Lien upon such properties or any part
thereof; provided, that such payment and discharge shall not be required with
respect to any such Tax, assessment, charge, levy or claim so long as the
validity or amount thereof shall be contested in
99
good faith by appropriate proceedings and the applicable Company shall have set
aside on its books adequate reserves with respect thereto in accordance with
GAAP and such contest operates to suspend collection of the contested
obligation, Tax, assessment or charge and enforcement of a Lien other than a
Permitted Lien and, in the case of Collateral, the applicable Company shall have
otherwise complied with the Contested Collateral Lien Conditions.
(b) Timely and correctly file all material Tax Returns required to be
filed by it.
SECTION 5.06 EMPLOYEE BENEFITS AND PENSION PLANS. (a) With respect to
each Plan, comply in all material respects with the applicable provisions of
ERISA and the Code and (b) furnish to the Administrative Agent (x) as soon as
possible after, and in any event within 10 days after any Responsible Officer of
the Companies or their ERISA Affiliates or any ERISA Affiliate knows or has
reason to know that, any ERISA Event has occurred that, alone or together with
any other ERISA Event could reasonably be expected to result in liability of the
Companies or their ERISA Affiliates in an aggregate amount exceeding $500,000 or
the imposition of a Lien, a statement of a Financial Officer of Holdings setting
forth details as to such ERISA Event and the action, if any, that the Companies
propose to take with respect thereto, and (y) upon request by the Administrative
Agent, copies of: (i) each Schedule B (Actuarial Information) to the annual
report (Form 5500 Series) filed by any Company or any ERISA Affiliate with the
Internal Revenue Service with respect to each Plan; (ii) the most recent
actuarial valuation report for each Plan; (iii) all notices received by any
Company or any ERISA Affiliate from a Multiemployer Plan sponsor or any
governmental agency concerning an ERISA Event; and (iv) such other documents or
governmental reports or filings relating to any Plan (or employee benefit plan
sponsored or contributed to by any Company) as the Administrative Agent shall
reasonably request.
(b) For each existing Canadian Pension Plan of any Canadian Loan Party,
such Canadian Loan Party shall, except as provided in Schedule 3.16, ensure that
such plan retains its registered status under and is administered in a timely
manner in all material respects in accordance with the applicable pension plan
text, funding agreement, the ITA and all other applicable laws. For each
Canadian Pension Plan hereafter adopted by any Canadian Loan Party that is
required to be registered under the ITA or any other applicable laws, that
Canadian Loan Party shall use its best efforts to seek and receive confirmation
in writing from the applicable governmental authorities to the effect that such
plan is unconditionally registered under the ITA and such other applicable laws.
For each existing and hereafter adopted Canadian Pension Plan and Canadian
Benefit Plan of any Canadian Loan Party, such Canadian Loan Party shall in a
timely fashion perform in all material respects all obligations (including
fiduciary, funding, investment and administration obligations) required to be
performed in connection with such plan and the funding media therefor. Each
Canadian Loan Party shall deliver to Collateral Agent if requested by Collateral
Agent, (i) promptly after the filing thereof by such Canadian Loan Party with
any applicable governmental authority, copies of each annual and other return,
report or valuation with respect to each Canadian Pension Plan of such Canadian
Loan Party; (ii) promptly after receipt thereof, a copy of any direction, order,
notice, ruling or opinion that such Canadian Loan Party may receive from any
applicable Governmental Authority with respect to any Canadian Pension Plan of
such Canadian Loan Party; (iii) notification within 30 days of any increases
having a cost to such Canadian Loan Party in excess of Cdn. $250,000 per annum,
in the benefits of any existing Canadian Pension Plan or Canadian Benefit Plan,
or the establishment of any new Canadian
100
Pension Plan or Canadian Benefit Plan, or the establishment of any new Canadian
Pension Plan or Canadian Benefit Plan, or the commencement of contributions to
any such plan to which such Canadian Loan Party was not previously contributing
and (iv) all material documents related to matters disclosed in Schedule 3.16.
SECTION 5.07 MAINTAINING RECORDS; ACCESS TO PROPERTIES AND INSPECTIONS.
Keep proper books of record and account in which full, true and correct entries
in conformity with GAAP and all Requirements of Law are made of all dealings and
transactions in relation to its business and activities. Keep proper records of
intercompany accounts (including, without limitation, the Borrowing Base
Guarantor Intercompany Loan Account) with full, true and correct entries
reflecting all payments received and paid (including, without limitation, funds
received by Borrower from swept deposit accounts of the other Companies). Each
Loan Party and other Company whose Equity Interests are pledged to the
Collateral Agent will permit any representatives designated by the
Administrative Agent or the Collateral Agent to visit and inspect the financial
records and the Property of such Loan Party and other Company whose Equity
Interests are pledged to the Collateral Agent at reasonable times and as often
as reasonably requested and to make extracts from and copies of such financial
records, and permit any representatives designated by the Administrative Agent
or the Collateral Agent to discuss the affairs, finances and condition of any
Loan Party and other Company whose Equity Interests are pledged to the
Collateral Agent with the officers thereof and independent accountants therefor.
SECTION 5.08 USE OF PROCEEDS. Use the proceeds of the Loans and request
the issuance of Letters of Credit only for the purposes set forth in Section
3.11.
SECTION 5.09 COMPLIANCE WITH ENVIRONMENTAL LAWS; ENVIRONMENTAL REPORTS.
(a) Comply, and use its best efforts to cause all lessees and other Persons
occupying Real Property owned, operated or leased by any Loan Party to comply,
in all material respects with all Environmental Laws and Environmental Permits
applicable to its operations and Real Property; obtain and renew all material
Environmental Permits applicable to its operations and Real Property; and
conduct any Response in accordance with Environmental Laws; provided, that no
Company shall be required to undertake any Response to the extent that its
obligation to do so is being contested in good faith and by proper proceedings
and appropriate reserves are being maintained with respect to such circumstances
in accordance with GAAP.
(b) If a Default caused by reason of a breach of Section 3.17 or
5.09(a) shall have occurred and be continuing for more than 20 days without the
Companies commencing activities reasonably likely to cure such Default, at the
written request of the Required Lenders through the Administrative Agent,
provide to the Lenders within 45 days after such request, at the expense of
Borrower, an environmental assessment report regarding the matters which are the
subject of such default, including where appropriate, any soil and/or
groundwater sampling, prepared by an environmental consulting firm and in the
form and substance reasonably acceptable to the Administrative Agent and
Collateral Agent and indicating the presence or absence of Hazardous Materials
and the estimated cost of any compliance or Response to address them.
SECTION 5.10 [INTENTIONALLY OMITTED]
SECTION 5.11 ADDITIONAL COLLATERAL; ADDITIONAL GUARANTORS. (a) Subject
to this Section 5.11, with respect to any Property acquired after the Closing
Date by Borrower or any
101
other Loan Party that is intended to be subject to the Lien created by any of
the Security Documents but is not so subject (but, in any event, excluding any
Property described in paragraph (b) of this subsection) promptly (and in any
event within 30 days after the acquisition thereof provided Collateral Agent has
provided all joinder agreements to the applicable Security Documents necessary
for the Loan Parties to comply herewith): (i) execute and deliver to the
Administrative Agent and the Collateral Agent such amendments or supplements to
the relevant Security Documents or such other documents as the Administrative
Agent or the Collateral Agent shall deem necessary or advisable to grant to the
Collateral Agent, for its benefit and for the benefit of the other Secured
Parties, a Lien on such Property subject to no Liens other than Permitted Liens,
and (ii) take all actions necessary to cause such Lien to be duly perfected to
the extent required by such Security Document in accordance with all applicable
Requirements of Law, including, without limitation, the filing of financing
statements in such jurisdictions as may be reasonably requested by the
Administrative Agent and Collateral Agent. Borrower shall otherwise take such
actions and execute and/or deliver to the Collateral Agent such reasonable
documents as the Administrative Agent or the Collateral Agent shall require to
confirm the validity, perfection and priority of the Lien of the Security
Documents against such after-acquired properties or assets.
(b) With respect to any Person that is or becomes a Wholly Owned
Subsidiary (other than any Foreign Subsidiary that is not a direct Subsidiary of
a Loan Party) promptly (and in any event within 30 days after such Person
becomes a Subsidiary) (i) deliver to the Collateral Agent the certificates, if
any, representing the Equity Interests of such Subsidiary (provided, that with
respect to any first-tier Foreign Subsidiary, in no event shall more than 65% of
the Equity Interests of any Foreign Subsidiary be subject to any Lien or pledged
under any Security Document if such pledge would have a material adverse tax
impact on Borrower (determined at the reasonable judgment of the Administrative
Agent after consultation with Borrower), together with undated stock powers or
other appropriate instruments of transfer executed and delivered in blank by a
duly authorized officer of such Subsidiary's parent, as the case may be, and all
intercompany notes owing from such Subsidiary to any Loan Party together with
instruments of transfer executed and delivered in blank by a duly authorized
officer of such Subsidiary, and (ii) cause such new Subsidiary (other than any
Foreign Subsidiary if such pledge would have a material adverse tax impact on
Borrower (determined at the reasonable judgment of the Administrative Agent
after consultation with Borrower) (A) to execute a Joinder Agreement or such
comparable documentation and a joinder agreement to the Security Documents in
the form annexed thereto which is in form and substance reasonably satisfactory
to the Administrative Agent, and (B) to take all actions necessary or advisable
in the opinion of the Collateral Agent to cause the Lien created by the Security
Agreements to be duly perfected to the extent required by such agreement in
accordance with all applicable Requirements of Law, including, without
limitation, the filing of financing statements in such jurisdictions as may be
reasonably requested by the Collateral Agent.
(c) If at any time any one or more Wholly Owned Subsidiaries in the
aggregate (other than any Foreign Subsidiary that is not a "first-tier" Foreign
Subsidiary) not otherwise subject to Section 5.11(b) have assets having either a
book value or fair market value in excess of $10.0 million, then Borrower shall,
and shall cause one or more of such Subsidiaries to, comply with Section 5.11(b)
within the time frames set forth in such subsection so that no one or more such
102
Subsidiaries in the aggregate hold assets having either a book value or fair
market value in excess of $10.0 million .
(d) Each Loan Party will promptly grant to the Collateral Agent, within
60 days of the acquisition thereof, a security interest in and Mortgage Lien on
each owned or leased Real Property of such Loan Party as is acquired by such
Loan Party after the Closing Date and that, together with any improvements
thereon, individually has a fair market value of at least $1.0 million, as
additional security for the Obligations (unless the subject Property is already
mortgaged to a third party to the extent permitted by Section 6.02). Such
Mortgages shall be granted pursuant to documentation reasonably satisfactory in
form and substance to the Administrative Agent and the Collateral Agent and
shall constitute valid and enforceable perfected Liens subject only to Liens
reasonably acceptable to the Collateral Agent. The Mortgages or instruments
related thereto shall be duly recorded or filed in such manner and in such
places as are required by law to establish, perfect, preserve and protect the
Liens in favor of the Collateral Agent required to be granted pursuant to the
Mortgages and all taxes, fees and other charges payable in connection therewith
shall be paid in full. Such Loan Party shall otherwise take such actions and
execute and/or deliver to the Collateral Agent such documents as the
Administrative Agent or the Collateral Agent shall require to confirm the
validity, perfection and priority of the Lien of any existing Mortgage or new
Mortgage against such after-acquired Real Property (including, without
limitation, a Title Policy, a Survey and local counsel opinion (in form and
substance reasonably satisfactory to the Administrative Agent and the Collateral
Agent) in respect of such Mortgage).
SECTION 5.12 SECURITY INTERESTS; FURTHER ASSURANCES. Promptly, upon the
reasonable request of the Administrative Agent, the Collateral Agent or any
Lender, at Borrower's expense, execute, acknowledge and deliver, or cause the
execution, acknowledgment and delivery of, and thereafter register, file or
record, or cause to be registered, filed or recorded, in an appropriate
governmental office, any document or instrument supplemental to or confirmatory
of the Security Documents or otherwise deemed by the Administrative Agent or the
Collateral Agent reasonably necessary or desirable for the continued validity,
perfection and priority of the Liens on the Collateral covered thereby superior
to and prior to the rights of all third Persons other than the holders of Prior
Liens and subject to no other Liens except as permitted by the applicable
Security Document, or obtain any consents, including, without limitation,
landlord or similar lien waivers and consents, as may be necessary or
appropriate in connection therewith. Deliver or cause to be delivered to the
Administrative Agent and the Collateral Agent from time to time such other
documentation, consents, authorizations, approvals and orders in form and
substance reasonably satisfactory to the Administrative Agent and the Collateral
Agent as the Administrative Agent and the Collateral Agent shall reasonably deem
necessary to perfect or maintain the Liens on the Collateral pursuant to the
Security Documents. Upon the exercise by the Administrative Agent, the
Collateral Agent or the Lenders of any power, right, privilege or remedy
pursuant to any Loan Document which requires any consent, approval,
registration, qualification or authorization of any Governmental Authority
execute and deliver all applications, certifications, instruments and other
documents and papers that the Administrative Agent, the Collateral Agent or the
Lenders may be so required to obtain. If the Administrative Agent, the
Collateral Agent or the Required Lenders determine that they are required by law
or regulation to have appraisals prepared in respect of the Real Property of any
Loan Party constituting Collateral, Borrower shall provide to the Administrative
Agent and
103
Collateral Agent appraisals that satisfy the applicable requirements of the Real
Estate Appraisal Reform Amendments of FIRREA and are otherwise in form and
substance satisfactory to the Administrative Agent and the Collateral Agent.
SECTION 5.13 INFORMATION REGARDING COLLATERAL; CORPORATE IDENTITY OR
TAXPAYER IDENTIFICATIONS. (a) Furnish to the Administrative Agent and the
Collateral Agent 30 days prior written notice (in the form of an officer's
certificate), clearly describing any of the following changes (i) in any Loan
Party's corporate name or in any trade name used to identify it in the conduct
of its business or in the ownership of its properties, (ii) in the location of
any Loan Party's chief executive office, its principal place of business, any
office in which it maintains books or records relating to Collateral owned by it
or any office or facility at which Collateral owned by it is located (including
the establishment of any such new office or facility), (iii) in any Loan Party's
identity, taxpayer identification, or corporate structure, (iv) in any Loan
Party's Federal Taxpayer Identification Number or (v) in any Loan Party's
jurisdiction of organization. Borrower agrees not to effect or permit any change
referred to in the preceding sentence unless all filings have been made under
the UCC or PPSA or otherwise that are required in order for the Collateral Agent
to continue at all times following such change to have a valid, legal and
perfected security interest in all the Collateral. Borrower agrees to provide to
the Collateral Agent such other information in connection with such changes as
the Collateral Agent may reasonably request. Borrower also agrees promptly to
notify the Administrative Agent and the Collateral Agent if any material portion
of the Collateral is subject to a Casualty Event.
(b) Each year, at the time of delivery of annual financial statements
with respect to the preceding fiscal year pursuant to paragraph (a) of Section
5.01, deliver to the Administrative Agent and the Collateral Agent a certificate
of a Financial Officer and the chief legal officer of Borrower (i) setting forth
any changes to the information required pursuant to the Perfection Certificate
or confirming that there has been no change in such information since the date
of the Perfection Certificate delivered on the Closing Date or the date of the
most recent certificate delivered pursuant to this Section 5.13(b) and (ii)
certifying that the Loan Parties have not taken any actions (and are not aware
of any actions so taken) to terminate any UCC or PPSA financing statements
(including fixture filings, as applicable) or other appropriate filings,
recordings or registrations to protect and perfect the security interests and
Liens under the Security Documents; it being understood and agreed that, from
time to time, upon reasonable request of a Lender, the Administrative Agent and
the Collateral Agent shall deliver to such Lender such certificates, supporting
documentation and supporting detail delivered to them under Section 5.13 and
Section 5.15.
SECTION 5.14 POST-CLOSING COLLATERAL MATTERS. Execute and deliver the
documents and complete the tasks set forth on Schedule 5.14, in each case within
the time limits specified on such schedule.
SECTION 5.15 BORROWING BASE-RELATED REPORTS. The Borrower shall deliver
or cause to be delivered (at the expense of the Borrower) to the Collateral
Agent and the Administrative Agent the following:
(a) as soon as available but in no event less frequently
than monthly, not later than 1:00 p.m., New York City time on the tenth
Business Day of the fiscal month
104
following the most recent fiscal month then ended, a Borrowing Base
Certificate from the Borrower accompanied by such supporting detail and
supporting documentation as shall be requested by the Collateral Agent
in its reasonable judgment, provided, that if at any time Excess
Availability is less than $50.0 million and so long as Borrower does
not maintain Excess Availability in excess of $50.0 million for a
period of three (3) consecutive fiscal months, Borrower shall deliver
additional weekly roll-forward of Accounts referenced in paragraph
(b)(i) below within five (5) Business Days after the end of each
calendar week, and, if requested by the Collateral Agent, a Borrowing
Base Certificate (prepared weekly to reflect results satisfactory to
the Collateral Agent) within five (5) Business Days after the end of
each calendar week, or more frequent Borrowing Base Certificates
reflecting shorter periods as reasonably requested by the Collateral
Agent. Each Borrowing Base Certificate shall reflect all information
through the end of the appropriate period for Borrower and each
Borrowing Base Guarantor; for the purposes of this paragraph (a), the
amount of outstanding Loans and LC Exposure in clause (b) of the
definition of the term "Excess Availability" shall be calculated on the
basis of average daily outstanding Loans and LC Exposure for the
applicable measuring period;
(b) as soon as available but in no event less frequently
than monthly (or more frequently as reasonably requested by the
Collateral Agent), not later than 1:00 p.m., New York City time on the
tenth Business Day of the fiscal month following the most recent fiscal
month then ended, Accounts and Inventory eligibility calculations and
all supporting calculations including, but not limited to, (i) a
roll-forward of Accounts from the last period including but not limited
to the following: sales, other debits, cash collections, write-offs,
cash discounts, product returns, pricing errors, other dilutive credits
and other non-dilutive credits, (ii) a summary trial balance showing
Accounts (consolidated by total customer balance) aged from the
original invoice statement date as follows: 1 to 30 days, 31 to 60
days, 61-90 days and 91 days or more, accompanied by a comparison to
the prior month's summary trial balance totals, (iii) a detailed trial
balance showing Accounts (consolidated by total customer balance)
specifically identified in Section 2.19 (xv)(a), aged in a format
similar to the format set forth in clause (ii) above, (iv) a schedule
of top ten Accounts aged in a format similar to the format set forth in
clause (ii) above, (v) a schedule of Inventory (other than Inventory on
consignment) by location showing raw materials, work in process and
finished goods, (vi) a schedule of Inventory on consignment by location
(vii) a schedule of the top ten trade payable balances, (viii) a
reconciliation of Accounts to the general ledger and the financial
statements, (ix) a reconciliation of Inventory to the general ledger
and the financial statements, (x) a reconciliation of trade accounts
payable to the general ledger and the financial statements;
(c) on the date any Borrowing Base Certificate is
delivered pursuant to paragraph (a) above or at such more frequent
intervals as the Collateral Agent may request from time to time
(together with a copy of all or any part of such delivery requested by
any Lender in writing after the Closing Date), a copy of the ledger
registering the Borrowing Base Guarantor Intercompany Loan Account as
of the date of the Borrowing Base Certificate, accompanied by such
supporting detail and
105
documentation as shall be requested by the Collateral Agent in its
reasonable credit judgment;
(d) at the time of delivery of each of the financial
statements delivered pursuant to Sections 5.01(a) and (b), a
reconciliation of the Accounts trial balance and quarter-end Inventory
reports of Borrower and Borrowing Base Guarantors to the general ledger
of such Loan Party, in each case, accompanied by such supporting detail
and documentation as shall be requested by the Collateral Agent in its
reasonable credit judgment;
(e) a general description of assets owned by the Loan
Parties which have been disposed of since the date of the most recent
Inventory Appraisal conducted pursuant to paragraph (d) above and the
aggregate book value thereof;
(f) a list of any applications for the registration of
any patent, trademark or copyright with the United States Patent and
Trademark Office, the United States Copyright Office, the Canadian
Intellectual Property Office or any similar office or agency which any
Loan Party has filed in the prior fiscal quarter;
(g) not later than the tenth Business Day of each fiscal
month (or more frequently as reasonably requested by the Collateral
Agent), a schedule of all Hedging Agreements, including notional
amounts and a statement setting forth in reasonable detail the amount
Borrower or the applicable Borrowing Base Guarantor, as applicable,
owes counterparties to Specified Hedging Agreements based on a
xxxx-to-market analysis and with due regard to recent market volatility
as of the last Business Day of the previous fiscal month (or if not
available, the nearest prior Business Day for which such evaluation is
available); and
(h) such other reports, statements and reconciliations
with respect to the Borrowing Base or Collateral of any or all Loan
Parties as the Collateral Agent shall from time to time request in its
reasonable credit judgment.
The delivery of each certificate and report or any other information delivered
pursuant to this Section 5.15 shall constitute a representation and warranty by
the Borrower that the statements and information contained therein are true and
correct in all material respects on and as of such date.
SECTION 5.16 MERGER OF SECURITIZATION VEHICLE.
Holdings and Borrower shall cause General Cable SPE to merge into
Borrower, with Borrower as a surviving entity, and, no later than one Business
Day after the Closing Date, shall deliver evidence thereof to Administrative
Agent.
SECTION 5.17 MAINTENANCE OF FOREIGN CREDIT LINES.
106
At any time when the average Excess Availability for a period of three
(3) consecutive fiscal months, as calculated by the Collateral Agent at the end
of each fiscal month, is less than $100.0 million, Holdings and Borrower shall
cause its Foreign Subsidiaries to maintain at all times the Foreign Credit Lines
in the amount not less than the Dollar Equivalent of $80.0 million and, after
the closing of the transactions contemplated by the European Term Loan Documents
and funding of the European Term Loan, in the amount not less than the Dollar
Equivalent of $50.0 million. For the purposes of this Section, the amount of
outstanding Loans and LC Exposure in clause (b) of the definition of the term
"Excess Availability" shall be calculated on the basis of the average daily
outstanding Loans and LC Exposure for the applicable measuring period.
SECTION 5.18 MAINTENANCE OF REAL PROPERTY.
Borrower and each applicable Loan Party shall:
(a) Keep all Real Property and systems useful and necessary in the
business of Borrower and such Loan Party in good working order and condition,
ordinary wear and tear excepted.
(b) Maintain all rights of way, easements, grants, privileges,
licenses, certificates, and permits necessary or advisable for the use of any
Real Property and not, without the prior written consent of the Administrative
Agent and the Collateral Agent, consent to any material public or private
restriction as to the use of any Real Property.
(c) Preserve and protect the Lien status of each respective Mortgage
and, if any Lien (other than a Permitted Lien) is asserted against a Mortgaged
Real Property, promptly and at its expense, give the Administrative Agent and
the Collateral Agent a detailed written notice of such Lien and pay the
underlying claim in full or take such other action so as to cause it to be
released or bonded over in a manner satisfactory to the Administrative Agent and
the Collateral Agent.
ARTICLE VI.
NEGATIVE COVENANTS
Each Loan Party covenants and agrees with each Lender that, so long as
this Agreement shall remain in effect and until the Commitments have been
terminated and the principal of and interest on each Loan, all Fees and all
other expenses or amounts payable under any Loan Document have been paid in full
and all Letters of Credit have been canceled or have expired or been fully cash
collateralized and all amounts drawn thereunder have been reimbursed in full,
unless the Required Lenders shall otherwise consent in writing, no Loan Party
will, nor will they cause or permit any Subsidiaries to:
SECTION 6.01 INDEBTEDNESS. Incur, create, assume or permit to exist,
directly or indirectly, any Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement and
the other Loan Documents;
107
(b) (i) Indebtedness actually outstanding on the Closing
Date and listed on Schedule 6.01(b) or (ii) refinancings or renewals
thereof; provided, that (A) any such refinancing Indebtedness is in an
aggregate principal amount not greater than the aggregate principal
amount of the Indebtedness being renewed or refinanced, plus the amount
of any premiums required to be paid thereon and fees and expenses
associated therewith, (B) such refinancing Indebtedness has a later or
equal final maturity and longer or equal weighted average life than the
Indebtedness being renewed or refinanced and (C) the covenants, events
of default subordination and other provisions thereof (including any
guarantees thereof) shall be, in the aggregate, no less favorable to
the Lenders than those contained in the Indebtedness being renewed or
refinanced, and (iii) the Qualified Senior Notes (including any notes
issued in exchange therefor) in accordance with the registration rights
document entered into in connection with the issuance of the Qualified
Senior Notes;
(c) Indebtedness of any Company under Interest Rate
Protection Agreements listed on Schedule 6.01(c) or under Specified
Hedging Agreement constituting Interest Rate Protection Agreements
entered into in order to fix the effective rate of interest on the
Loans and such other non-speculative Interest Rate Protection
Agreements which constitute Specified Hedging Agreement which may be
entered into from time to time by such Company and which such Company
in good faith believes will provide protection against fluctuations in
interest rates with respect to floating rate Indebtedness of such
Company then outstanding, and permitted to remain outstanding, pursuant
to the other provisions of this Section 6.01;
(d) Indebtedness under Specified Hedging Agreements
(other than Interest Rate Protection Agreements) entered into from time
to time by any Company in accordance with Section 6.04(c);
(e) to the extent recorded in the Companies' intercompany
account ledgers, intercompany Indebtedness of any of the Companies
outstanding to the extent permitted by Section 6.04(d), 6.04(m) or
6.06(d);
(f) Indebtedness of the Borrower, its Domestic
Subsidiaries and General Cable Canada in respect of Purchase Money
Obligations and Capital Lease Obligations and refinancings or renewals
thereof (other than refinancings funded with intercompany advances), in
an aggregate amount not to exceed the Dollar Equivalent of $5.0 million
at any time outstanding;
(g) Indebtedness incurred by Foreign Subsidiaries
(including Foreign Credit Lines but exclusive of the Indebtedness
incurred by General Cable Spain pursuant to the European Term Loan and
exclusive of the GCC Spain Intercompany Debt) from time to time after
the Closing Date so long as the aggregate principal amount of all such
Indebtedness (including trade letters of credit) incurred pursuant to
this paragraph (g) at any time outstanding does not exceed the Dollar
Equivalent of (i) with respect to Indebtedness outstanding under the
Foreign Credit Lines, the Dollar Equivalent of $150.0 million and (ii)
with respect to all such other Indebtedness, $25.0 million; provided,
that such Indebtedness incurred by Foreign Subsidiaries which is owing
to
108
Borrower or a Borrowing Base Guarantor shall be permitted only to the
extent permitted under Section 6.04(d)(ii);
(h) Indebtedness incurred by General Cable Spain pursuant
to the European Term Loan Documents as long as (i) the aggregate
principal amount of all such Indebtedness at any time outstanding does
not exceed EUR 50.0 million and (ii) the proceeds of such Indebtedness
are immediately applied by General Cable Spain to repay to Borrower the
GCC Spain Refinancing Intercompany Debt in an amount equal to
$27,687,748.15 and any and all GCC Spain Intercompany Debt incurred
after the Closing Date, the proceeds of which Borrower shall
immediately use to repay the Obligations (without reduction in
Commitments);
(i) the GCC Spain Intercompany Debt as long as (i) the
aggregate principal amount of all GCC Spain Intercompany Debt (other
than GCC Spain Refinancing Intercompany Debt) existing on the Closing
Date does not exceed the Dollar Equivalent of $35.0 million, (ii) the
GCC Spain Refinancing Intercompany Debt does not exceed the Dollar
Equivalent of $27.7 million, (iii) GCC Spain Intercompany Debt incurred
by reason of intercompany advances of Borrower to General Cable Spain
after the Closing Date does not exceed the Dollar Equivalent of $1.0
million, and (iv) in each case, such Indebtedness shall simultaneously
be recorded on General Cable Spain's and Borrower's ledgers as an
intercompany loan and shall be evidenced by a promissory note in
substantially the form of Exhibit L, which shall be pledged (and
delivered) by Borrower as Collateral pursuant to the Security
Agreement;
(j) Indebtedness for industrial revenue bonds or other
similar governmental or municipal bonds for the deferred purchase price
of newly acquired Property and to finance equipment of Borrower and the
Borrowing Base Guarantors (pursuant to purchase money mortgages or
otherwise and whether owed to the seller or a third party) used in the
ordinary course of business (provided, that such financing is entered
into within 180 days of the acquisition of such Property) of Borrower
and the Borrowing Base Guarantors which shall not exceed $12 million in
the aggregate at any one time outstanding, and any refinancings of
Indebtedness permitted under this paragraph (h);
(k) Indebtedness in respect of workers' compensation
claims, self-insurance obligations, performance bonds, surety appeal or
similar bonds and completion guarantees provided by a Company in the
ordinary course of its business;
(l) unsecured Contingent Obligations:
(i) of Holdings in respect of Indebtedness (other
than Indebtedness for borrowed money) of any Foreign
Subsidiary to the extent such Indebtedness is permitted to be
incurred by such Foreign Subsidiary pursuant to paragraph (g)
or (h) above and as long as such Contingent Obligations of
Holdings are issued in the ordinary course business and do not
exceed the Dollar Equivalent of $5.0 million in the aggregate
at any time
109
(ii) of Holdings or Borrower in respect of lease
obligations, contract obligations or other obligations (other
than Indebtedness for borrowed money) of any other Domestic
Loan Party to the extent not otherwise prohibited hereunder as
long as such Contingent Obligations are issued by Holdings and
Borrower in the ordinary course of their business;
(iii) of Borrower in respect of Indebtedness for
borrowed money of NextGen as long as such Contingent
Obligations do not exceed, together with all Investments made
in NextGen under Section 6.04(n)(ii), $5.0 million in the
aggregate at any time;
(iv) of Holdings in respect of Indebtedness for
borrowed money of Joint Ventures (other than NextGen) as long
as such Contingent Obligations do not exceed, together with
all Investments made in such Joint Ventures under Section
6.04(n)(i), the Dollar Equivalent of $10 million in the
aggregate at any time; or
(v) of any Foreign Subsidiary in respect of
Indebtedness of any other Foreign Subsidiaries to the extent
the primary Indebtedness of such other Foreign Subsidiary is
permitted under paragraph (g) or (h) above;
(m) Indebtedness in respect of taxes, assessments or
governmental charges to the extent that payment thereof shall not at
the time be required to be made in accordance with Section 5.05;
(n) Indebtedness in respect of netting services and
overdraft protections in connection with deposit accounts, in each case
in the ordinary course of business;
(o) Acquisition Debt Issuance; and
(p) other unsecured Indebtedness (not of the type covered
in paragraphs (a) - (o) above) of any Company incurred, created,
assumed or permitted to exist after the Closing Date not to exceed the
Dollar Equivalent of $1.0 million in the aggregate principal amount at
any time outstanding.
SECTION 6.02 LIENS. Create, incur, assume or permit to exist, directly
or indirectly, any Lien on any Property now owned or hereafter acquired by it or
on any income or revenues or rights in respect of any thereof, except (the
"PERMITTED LIENS"):
(a) inchoate Liens for taxes, assessments or governmental
charges or levies not yet due and payable or delinquent and Liens for
taxes, assessments or governmental charges or levies, which (i) are
being contested in good faith by appropriate proceedings for which
adequate reserves have been established in accordance with GAAP, which
proceedings (or orders entered in connection with such proceedings)
have the effect of preventing the forfeiture or sale of the Property or
assets subject to any such Lien, or (ii) in the case of any such charge
or claim which has or may become a Lien against any of the Collateral,
such Lien and the contest thereof shall satisfy the Contested
Collateral Lien Conditions;
110
(b) Liens in respect of Property of any Company imposed
by law, which were incurred in the ordinary course of business and do
not secure Indebtedness for borrowed money, such as carriers',
warehousemen's, materialmen's, landlords', workmen's, suppliers',
repairmen's and mechanics' Liens and other similar Liens arising in the
ordinary course of business, and (i) which do not in the aggregate
materially detract from the value of the Property of the Companies,
taken as a whole, and do not materially impair the use thereof in the
operation of the business of the Companies, taken as a whole, (ii)
which do not pertain to Indebtedness that is due and payable or which
pertain to Liens that are being contested in good faith by appropriate
proceedings for which adequate reserves have been established in
accordance with GAAP, which proceedings (or orders entered in
connection with such proceedings) have the effect of preventing the
forfeiture or sale of the Property or assets subject to any such Lien,
and (iii) in the case of any such Lien which has or may become a Lien
against any of the Collateral, such Lien and the contest thereof shall
satisfy the Contested Collateral Lien Conditions;
(c) Liens in existence on the Closing Date and set forth
on Schedule 6.02(c); provided, that (i) the aggregate principal amount
of the Indebtedness, if any, secured by such Liens does not increase;
and (ii) such Liens do not encumber any Property other than the
Property subject thereto on the Closing Date;
(d) easements, rights-of-way, restrictions (including
zoning restrictions), covenants, encroachments, protrusions and other
similar charges or encumbrances, and minor title deficiencies on or
with respect to any Real Property, in each case whether now or
hereafter in existence, not (i) securing Indebtedness, (ii)
individually or in the aggregate materially impairing the value or
marketability of such Real Property and (iii) individually or in the
aggregate materially interfering with the conduct of the business of
the Companies at such Real Property;
(e) Liens arising out of judgments or awards not
resulting in a Default and in respect of which such Company shall in
good faith be prosecuting an appeal or proceedings for review in
respect of which there shall be secured a subsisting stay of execution
pending such appeal or proceedings; provided, that the aggregate amount
of all such judgments or awards (and any cash and the fair market value
of any Property subject to such Liens) does not exceed $1.0 million at
any time outstanding;
(f) Liens (other than any Lien imposed by ERISA) (i)
imposed by law or deposits made in connection therewith in the ordinary
course of business in connection with workers' compensation,
unemployment insurance and other types of social security, (ii)
incurred in the ordinary course of business to secure the performance
of tenders, statutory obligations (other than excise taxes), surety,
stay, customs and appeal bonds, statutory bonds, bids, leases,
government contracts, trade contracts, performance and return of money
bonds and other similar obligations (exclusive of obligations for the
payment of borrowed money), or (iii) arising by virtue of deposits made
in the ordinary course of business to secure liability for premiums to
insurance carriers; provided, that (w) with respect to clauses (i),
(ii) and (iii) hereof, such Liens are for amounts not yet due and
payable or delinquent or, to the extent such amounts are so due and
payable, such amounts are being contested in good faith by appropriate
proceedings for which adequate
111
reserves have been established in accordance with GAAP, which
proceedings for orders entered in connection with such proceedings have
the effect of preventing the forfeiture or sale of the Property or
assets subject to any such Lien, (x) to the extent such Liens are not
imposed by law, such Liens shall in no event encumber any Property
other than cash and Cash Equivalents which have been deposited with
such lienholder or has otherwise been subordinated to the Liens
securing the Obligations hereunder pursuant to a Landlord Lien Waiver
and Access Agreement, (y) in the case of any such Lien against any of
the Collateral, such Lien and the contest thereof shall satisfy the
Contested Collateral Lien Conditions and (z) the aggregate amount of
deposits at any time pursuant to clause (ii) and (iii) shall not exceed
$250,000 in the aggregate;
(g) Leases or subleases with respect to the assets or
properties of any Company, in each case entered into in the ordinary
course of such Company's business so long as such Leases are
subordinate in all respects to the Liens granted and evidenced by the
Security Documents and do not, individually or in the aggregate, (i)
interfere in any material respect with the ordinary conduct of the
business of any Company or (ii) materially impair the use (for its
intended purposes) or the value of the Property subject thereto;
(h) Liens arising out of conditional sale, title
retention, consignment or similar arrangements for the sale of goods
entered into by any Company in the ordinary course of business in
accordance with the past practices of such Company;
(i) Liens arising pursuant to Purchase Money Obligations
or Capital Lease Obligations incurred pursuant to Section 6.01(f) or
Liens arising pursuant to sale and leaseback transactions to the extent
permitted under Section 6.03; provided, that (i) the Indebtedness
secured by any such Lien (including refinancings thereof) does not
exceed 100% of the cost of the Property being acquired or leased at the
time of the incurrence of such Indebtedness and (ii) any such Liens
attach only to the Property being financed pursuant to such Purchase
Money Obligations, Capital Lease Obligations or sale and leaseback
transactions and do not encumber any other Property of any Company;
(j) bankers' Liens, rights of setoff and other similar
Liens existing solely with respect to cash and Cash Equivalents on
deposit in one or more accounts maintained by any Company, in each case
granted in the ordinary course of business in favor of the bank or
banks with which such accounts are maintained, securing amounts owing
to such bank with respect to cash management and operating account
arrangements, including those involving pooled accounts and netting
arrangements; provided, that in no case shall any such Liens secure
(either directly or indirectly) the repayment of any Indebtedness;
(k) Liens on Property of a Person existing at the time
such Person is acquired or merged with or into or consolidated with any
Company (and not created in anticipation or contemplation thereof) so
long as such merger or acquisition is permitted pursuant to Section
6.05; provided, that such Liens do not extend to Property not subject
to such Liens at the time of acquisition (other than improvements
thereon) and are no more favorable to the lienholders than the existing
Lien;
112
(l) Liens on Property of Foreign Subsidiaries; provided,
that (i) such Liens do not extend to, or encumber, Property which
constitutes Collateral, and (ii) such Liens extending to the Property
of any Foreign Subsidiary secure only Indebtedness of Foreign
Subsidiaries as of the Closing Date or Indebtedness incurred by a
Foreign Subsidiary pursuant to Section 6.01(g);
(m) Liens granted pursuant to the Security Documents;
(n) licenses or sublicenses of Intellectual Property
granted by any Company in the ordinary course of business and not
interfering in any material respect with the ordinary conduct of the
business of such Company;
(o) Liens attaching solely to xxxx xxxxxxx money deposits
in connection with any letter of intent or purchase agreement in
connection with a Permitted Acquisition;
(p) Liens in favor of customs and revenues authorities
which secure payment of customs duties in connection with the
importation of goods to the extent required by law;
(q) Liens deemed to exist in connection with set-off
rights in the ordinary course of Borrower's and its Subsidiaries'
business;
(r) replacement, extension or renewal of any Lien
permitted herein in the same property previously subject thereto
provided the underlying Indebtedness is permitted to be replaced,
extended and renewed under Section 6.01(b);
(s) the filing of financing statements solely as a
precautionary measure in connection with operating leases or
consignment of goods; and
(t) other Liens (not of a type set forth in clauses (a)
through (s) above) incurred in the ordinary course of business of any
Company with respect to obligations (other than Indebtedness) that do
not in the aggregate exceed $1.0 million at any time outstanding;
provided, however, that no Liens (other than Liens permitted under Section
6.02(a)(ii)) shall be permitted to exist, directly or indirectly, on any Pledged
Equity Interests or Pledged Notes (each as defined in the Security Agreements
and Foreign Pledge Agreements).
SECTION 6.03 SALE AND LEASEBACK TRANSACTIONS. Enter into any
arrangement, directly or indirectly, with any Person whereby it shall sell or
transfer any Property, real or personal, used or useful in its business, whether
now owned or hereafter acquired, and thereafter rent or lease such Property or
other Property which it intends to use for substantially the same purpose or
purposes as the Property being sold or transferred unless at the time of the
proposed sale and leaseback transaction: (a) no Default then exists or would
result therefrom; (b) the aggregate Fair Market Value of all Property permitted
to be sold and leased back pursuant to this Section 6.03 shall not exceed $10.0
million; (c) Borrower shall have delivered, at least five Business Days prior
thereto, all agreements, documents and instruments pursuant to which the
proposed sale and leaseback is to be effected, all of which shall be on terms
and in form and
113
substance satisfactory to the Administrative Agent and the Collateral Agent; and
(d) Borrower shall have delivered a certificate to the Administrative Agent and
the Collateral Agent certifying that no Default exists or would result after
giving effect to the proposed sale and leaseback, identifying the Property
subject to such sale and leaseback transaction and that all of the requirements
for a Permitted Asset Sale have been satisfied.
SECTION 6.04 INVESTMENTS, LOANS AND ADVANCES. Directly or indirectly,
lend money or credit or make advances to any Person, or purchase or acquire any
stock, obligations or securities of, or any other interest in, or make any
capital contribution to, any other Person, or purchase or own a futures contract
or otherwise become liable for the purchase or sale of currency or other
commodities at a future date in the nature of a futures contract (all of the
foregoing, collectively, "INVESTMENTS"), except that the following shall be
permitted:
(a) Investments outstanding on the Closing Date and
identified on Schedule 6.04(a);
(b) the Companies may (i) acquire and hold accounts
receivables owing to any of them if created or acquired in the ordinary
course of business and payable or dischargeable in accordance with
customary terms, (ii) acquire and hold cash and Cash Equivalents, (iii)
endorse negotiable instruments for collection in the ordinary course of
business, (iv) make lease, utility and other similar deposits in the
ordinary course of business; or (v) make prepayments and deposits to
suppliers in the ordinary course of business;
(c) any Company may enter into Interest Rate Protection
Agreements to the extent permitted by Section 6.01(c) or may enter into
and perform its obligations under Specified Hedging Agreements entered
into in the ordinary course of business and so long as any such
Specified Hedging Agreement is not speculative in nature and is (i)(A)
related to income derived from operations of such Company or otherwise
related to purchases permitted hereunder from suppliers or (B) entered
into to protect such Company against fluctuations in the prices of raw
materials used in its businesses and (ii) permitted by Section 6.01(d);
(d) (i) Borrower, any Borrowing Base Guarantor, or any
Foreign Subsidiary may make intercompany loans and advances to Borrower
or any other Borrowing Base Guarantor (other than Holdings), (ii)
Borrower or any Borrowing Base Guarantor may make intercompany loans
and advances to any Foreign Subsidiary (other than General Cable Spain)
in an amount not to exceed the Dollar Equivalent of $10.0 million to
all Foreign Subsidiaries (other than General Cable Spain) in the
aggregate outstanding at any time, (iii) Borrower may make intercompany
loans advances to General Cable Spain giving rise to the GCC Spain
Intercompany Debt to the extent permitted in Section 6.01(i), (iv)
Borrower may make intercompany loans and advances to Marathon
Manufacturing Holdings, Inc., a Delaware corporation, MLTC Company, a
Delaware corporation, General Cable Resources and General Cable
Technologies as long as such intercompany loans and advances to all
such Persons do not exceed $1.0 million in the aggregate at any time
and (v) any Foreign Subsidiary may make intercompany loans and advances
to any other Foreign Subsidiary; provided, that each loan and advance
114
referenced in clauses (i), (ii), (iii), (iv) and (v) above shall
simultaneously be recorded on Borrower's, the applicable Borrowing Base
Guarantor's, or the applicable Foreign Subsidiary's ledgers as an
intercompany loan and shall be evidenced by a promissory note in
substantially the form of Exhibit L, which, except in the case of
promissory notes evidencing loans or advances made by any Foreign
Subsidiary (other than General Cable Spain), shall be pledged (and
delivered) by Borrower or the applicable Borrowing Base Guarantor that
is the lender of such intercompany loan as Collateral pursuant to the
Security Agreements and Foreign Pledge Agreements and which shall be
subordinated to the Obligations pursuant to such promissory notes;
(e) Any Company may make loans and advances (including
payroll, travel and entertainment related advances) in the ordinary
course of business to its respective employees or senior management
(other than any loans or advances to any director or executive officer
(or equivalent thereof) that would be in violation of Section 402 of
the Xxxxxxxx-Xxxxx Act) so long as the aggregate principal amount
thereof made by all Companies at any time outstanding (determined
without regard to any write-downs or write-offs of such loans and
advances) shall not exceed the Dollar Equivalent of $ 2.0 million;
(f) Borrower or Intermediate Holdings may establish
Subsidiaries to the extent permitted by Section 6.12;
(g) Investments (other than intercompany loans and
advances) (i) by Borrower in any Borrowing Base Guarantor (but with
respect to Holdings, only to the extent such Investments in Holdings
are permitted under 6.07, or with respect to Intermediate Holdings,
only to the extent such Investments in Intermediate Holdings are
permitted under Section 6.06(d) or 6.07), (ii) by any Company (other
than Borrower or any Borrowing Base Guarantor) in Borrower or any
Borrowing Base Guarantor and (iii) by any Foreign Subsidiary in any
other Company;
(h) Investments in securities of trade creditors or
customers in the ordinary course of business and consistent with such
Company's past practices that are received in settlement of bona fide
disputes or pursuant to any plan of reorganization or liquidation or
similar arrangement upon the bankruptcy or insolvency of such trade
creditors or customers;
(i) Investments made by Borrower or any Subsidiary as a
result of consideration received in connection with an Asset Sale made
in compliance with Section 6.05;
(j) xxxxxxx money required and any Equity Issuance made
by Holdings in connection with and to the extent permitted by Permitted
Acquisitions;
(k) Loan Parties may hold Investments to the extent such
Investments reflect an increase in the value of Investments otherwise
permitted under this Section 6.04 hereof;
115
(l) Investments in (i) deposit accounts opened in the
ordinary course of business provided, that such deposit accounts are
subject to Deposit Account Control Agreements and (ii) securities
accounts opened in the ordinary course of business provided, that such
securities accounts are subject to Securities Account Control
Agreements;
(m) Borrower may make intercompany loans and advances to
Holdings solely for the purpose of:
(i) Holdings' repurchasing, so long as all
proceeds thereof are in fact promptly used by Holdings to
repurchase, outstanding shares of its common stock following
the death, disability, retirement or termination of employment
of employees, officers or directors of any Company as long as
(A) such loans and advances in the aggregate shall not exceed
$500,000 in any fiscal year of Holdings less any Restricted
Payments made pursuant to Section 6.06(d)(i) in such fiscal
year and (B) no Event of Default has occurred and is
continuing and no Default would result after giving effect to
any such Restricted Payment;
(ii) Holdings' paying, so long as all proceeds
thereof are in fact promptly used by Holdings to pay, its
income tax and income taxes pursuant to the Tax Sharing
Agreement, in accordance with Section 6.07(e), in each case
when and as due;
(iii) Holdings' paying, so long as all proceeds
thereof are in fact promptly used by Holdings to pay scheduled
semi-annual interest on the Qualified Senior Notes;
(iv) Holdings' making, so long as all proceeds
thereof are in fact promptly used by Holdings to make,
Restricted Payments with respect to Convertible Preferred
Stock elected to be made by Holdings in cash for the current
quarter dividend period (commencing with the first such
quarterly dividend period ending February 24, 2004);
provided, that each loan and advance referenced in clauses
(i), (ii), (iii) and (iv) above shall simultaneously be
recorded on Borrower's ledger as an intercompany loan and
shall be evidenced by a promissory note in substantially the
form of Exhibit L, which shall be pledged (and delivered) by
Borrower as Collateral pursuant to the Security Agreements and
which shall be subordinated to the Obligations pursuant to
such promissory notes;
(n) additional Investments after the Closing Date in any
Joint Venture as long as the aggregate outstanding amount of additional
Investments in all Joint Ventures does not exceed (i) with respect to
all Joint Ventures other than NextGen, together with all Contingent
Obligations issued in respect of such Joint Ventures under Section
6.01(l)(iv) the Dollar Equivalent of $10.0 million in the aggregate or
(ii) with respect to NextGen, together with all Contingent Obligations
issued in respect of NextGen under Section 6.01(l)(iii), the Dollar
Equivalent of $5.0 million in the aggregate; and
116
(o) Loan Parties may capitalize or forgive any
Indebtedness owed to it by other Loan Parties (except that Borrower
shall not forgive intercompany loans made to any other Loan Party).
SECTION 6.05 MERGERS, CONSOLIDATIONS, SALES OF ASSETS AND ACQUISITIONS.
Wind up, liquidate or dissolve its affairs or enter into any transaction of
merger or consolidation, enter into any Asset Sale, or otherwise convey, sell,
lease or otherwise dispose of (or agree to do any of the foregoing at any future
time) all or any part of its Property or assets, or purchase or otherwise
acquire (in one or a series of related transactions) all or any part of the
Property, Equity Interests, or assets of any Person (or agree to do any of the
foregoing at any future time), except that:
(a) Capital Expenditures by Borrower and the Subsidiaries
shall be permitted to the extent permitted by Section 6.08(b);
(b) (i) purchases or other acquisitions of inventory,
materials, equipment and intangible assets in the ordinary course of
business shall be permitted, (ii) subject to Section 2.10(c), Asset
Sales of used, worn out, obsolete or surplus Property by any Company in
the ordinary course of business and the abandonment or other Asset Sale
of Intellectual Property that is, in the reasonable judgment of
Borrower, no longer economically practicable to maintain or useful in
the conduct of the business of the Companies taken as a whole shall be
permitted, (iii) sale of Equipment or Real Property, as applicable, or
any portion thereof, due to the termination of operations at (A) 00
Xxxxxxx Xx., Xxxxxxx XX 00000, (B) 000 Xxxx 0xx Xxxxxx, Xxxxxx, XX
00000 and (C) 00 Xxxxx Xx., Xxxxx Xxxxxx, XX 00000, in each case, on
terms and pursuant to documentation reasonably acceptable to the
Administrative Agent and the Collateral Agent, (iv) Permitted Asset
Sales by all Domestic Loan Parties aggregating no more than $10.0
million less any prepayments made pursuant to the definition of
Permitted Fixed Asset Exchange shall be permitted, (v) Permitted Asset
Sales aggregating no more than $25.0 million less any prepayments made
pursuant to the definition of Permitted Fixed Asset Exchange shall be
permitted by a Foreign Subsidiary after the Closing Date and (vi)
Permitted Fixed Asset Exchanges shall be permitted;
(c) Investments in connection with any such transaction
may be made to the extent permitted by Section 6.04;
(d) Holdings and its Subsidiaries may sell Cash
Equivalents and use cash for purposes that are not otherwise prohibited
by the terms of this Agreement in the ordinary course of business;
(e) Borrower and the Subsidiaries may lease (as lessee or
lessor) real or personal Property and may guaranty such lease, in each
case, in the ordinary course of business and in accordance with the
applicable Security Documents;
(f) the Transactions shall be permitted as contemplated
by the Transaction Documents;
117
(g) Borrower, any Borrowing Base Guarantor (other than
Holdings) or, in the case of any Permitted Non-Loan Funded Acquisition,
any Foreign Subsidiary may consummate Permitted Acquisitions;
(h) any Loan Party (other than Holdings, Intermediate
Holdings or Borrower) may transfer Property or lease to or acquire or
lease Property from any Loan Party or any Loan Party (other than
Holdings, Borrower and Intermediary Holdings) may be merged into
another Domestic or Canadian Loan Party as long as Borrower, Holdings
or Intermediary Holdings is the surviving corporation of such merger;
provided, that the Lien on and security interest in such Property
granted or to be granted in favor of the Collateral Agent under the
Security Documents shall be maintained or created in accordance with
the provisions of Section 5.11 or 5.12, as applicable;
(i) any Subsidiary (other than Borrower or any Borrowing
Base Guarantor) may dissolve, liquidate or wind up its affairs at any
time; provided, that such dissolution, liquidation or winding up, as
applicable, could not reasonably be expected to have a Material Adverse
Effect;
(j) discounts or forgiveness of account receivables in
the ordinary course of business or in connection with collection or
compromise thereof shall be permitted provided the account debtor is
not an Affiliate; and
(k) Permitted Liens (to the extent constituting a
conveyance of Property) shall be permitted.
To the extent the Supermajority Lenders waive the provisions of this Section
6.05 with respect to the sale of any Collateral, or any Collateral is sold as
permitted by this Section 6.05, such Collateral (unless sold to a Company) shall
be sold free and clear of the Liens created by the Security Documents, and the
Administrative Agent and the Collateral Agent shall take all actions deemed
appropriate in order to effect the foregoing.
SECTION 6.06 RESTRICTED PAYMENTS. Make any Restricted Payment, except
that:
(a) any Subsidiary that is a Loan Party (other than
Borrower and Intermediate Holdings) (i) may make Restricted Payments to
Borrower or any Domestic Subsidiary or Canadian Subsidiary which is a
Wholly Owned Subsidiary and (ii) if such Domestic Subsidiary or
Canadian Subsidiary is not a Wholly Owned Subsidiary, may make
Restricted Payments to its shareholders generally so long as Borrower
or its Subsidiary which owns the Equity Interest or interests in the
Subsidiary making such Restricted Payments receives at least its
proportionate share thereof (based upon its relative holdings of Equity
Interests in the Subsidiary making such Restricted Payments and taking
into account the relative preferences, if any, of the various classes
of Equity Interests in such Subsidiary);
(b) any Subsidiary that is not a Loan Party (i) may make
Restricted Payments to a Wholly Owned Subsidiary that is not a Loan
Party and (ii) if such Subsidiary is not a Wholly Owned Subsidiary, may
make Restricted Payments to its shareholders generally so long as
Subsidiary which owns the Equity Interest or interests in the
Subsidiary
118
making such Restricted Payments receives at least its proportionate
share thereof (based upon its relative holdings of Equity Interests in
the Subsidiary making such Restricted Payments and taking into account
the relative preferences, if any, of the various classes of Equity
Interests in such Subsidiary);
(c) any Subsidiary that is not a Loan Party may make
Restricted Payments to a Loan Party as long as (i) such Loan Party is
the most direct holder of Equity Interest in such Subsidiary and (ii)
proceeds thereof, through one or more Restricted Payments of the
Persons that are the most direct holders of Equity Interest in the
Person making the Restricted Payments, are received by Borrower or
Holdings;
(d) Borrower may make cash Restricted Payments to
Intermediate Holdings, provided, that Intermediate Holdings
contemporaneously uses the proceeds of such Restricted Payments to make
Restricted Payments in the same amount to Holdings solely for the
purpose of:
(i) Holdings' repurchasing, so long as all
proceeds thereof are in fact promptly used by Holdings to
repurchase, outstanding shares of its common stock following
the death, disability, retirement or termination of employment
of employees, officers or directors of any Company as long as
(A) such Restricted Payments in the aggregate shall not
exceed, together with the intercompany loans and advances
under Section 6.04(m)(i), $500,000 in any fiscal year of
Holdings and (B) no Event of Default has occurred and is
continuing and no Default would result after giving effect to
any such Restricted Payment;
(iii) Holdings' paying, so long as all proceeds
thereof are in fact promptly used by Holdings to pay, its
income tax and income taxes pursuant to the Tax Sharing
Agreement, in accordance with Section 6.07(e), in each case
when and as due;
(iv) Holdings' paying, so long as all proceeds
thereof are in fact promptly used by Holdings to pay scheduled
semi-annual interest on the Qualified Senior Notes;
(v) Holdings' making, so long as all proceeds
thereof are in fact promptly used by Holdings to make,
Restricted Payments with respect to Convertible Preferred
Stock elected to be made by Holdings in cash for the current
quarter dividend period (commencing with the first such
quarterly dividend period ending February 24, 2004);
(e) to the extent any payment under any Intercompany Agreement
constitutes a Restricted Payment, Borrower, Holdings or other Guarantor, as
applicable, party to such Intercompany Agreement may make such Restricted
Payment; and
(f) Borrower may make cash Restricted Payments to Intermediate Holdings
other than those described in clause (d) above, provided, that Intermediate
Holdings uses the proceeds of such Restricted Payments to make Restricted
Payments in the same amount to Holdings as long as (A) the aggregate amount of
such Restricted Payments received by Holdings does not exceed
119
$2.0 million in any fiscal year of Holdings and (B) Borrower delivers written
notice thereof to Administrative Agent and Collateral Agent prior to making each
such Restricted Payment.
SECTION 6.07 TRANSACTIONS WITH AFFILIATES. Enter into, directly or
indirectly, any transaction or series of related transactions, whether or not in
the ordinary course of business, with any Affiliate of any Company (other than
between or among Borrower and its Wholly Owned Subsidiaries), other than in the
ordinary course of business and on terms and conditions substantially as
favorable to such Company as would reasonably be obtained by such Company at
that time in a comparable arm's-length transaction with a Person other than an
Affiliate, except that:
(a) Restricted Payments may be made to the extent
provided in Section 6.06;
(b) loans may be made and other transactions may be
entered into between and among any Company and its Affiliates to the
extent permitted by Sections 6.01 and 6.04;
(c) customary fees may be paid to non-officer directors
of Holdings and customary indemnities may be provided to all directors
of Holdings;
(d) Borrower may pay management fees to Holdings from
time to time in an amount not in excess of Holdings' compensation
expenses for its employees;
(e) Borrower or any Subsidiary may make payments to
Holdings pursuant to a Tax Sharing Agreement in an amount not in excess
of the federal and state (in such states that permit consolidated or
combined tax returns) income tax liability that Borrower and the
Subsidiaries would have been liable for if any of the Companies had
filed their taxes on a stand-alone basis; provided, that such payments
shall be made by Holdings no earlier than five days prior to the date
on which Holdings is required to make its payments to the Internal
Revenue Service, as applicable;
(f) Borrower, Holdings and other Guarantors party to the
Intercompany Agreement may make payments under the Intercompany
Agreements;
(g) General Cable Resources shall not engage in any
business or incur any obligation other than as provided in the
Intercompany Agreements; and
(h) the Transactions may be effected.
SECTION 6.08 FINANCIAL COVENANTS.
(a) Minimum Fixed Charge Coverage Ratio. Permit as of the end of each
fiscal quarter ending during the period set forth in the table below the
Consolidated Fixed Charge Coverage Ratio for the Test Period then ended to be
less than the ratio set forth opposite such period in the table below:
120
FIXED CHARGE
PERIOD COVERAGE RATIO
---------------------------------------------------------------------------------
From January 1, 2004 through December 31, 2004 1.00 to 1.00
From January 1, 2005 through December 31, 2005 1.15 to 1.00
From January 1, 2006 through Maturity Date and thereafter 1.25 to 1.00
(b) Limitation on Capital Expenditures. Permit the aggregate amount of
Capital Expenditures made in any test period set forth below, to exceed the
amount set forth opposite such period below:
AMOUNT (IN
TEST PERIOD MILLIONS)
---------------------------------------------------------------------------------
From October 1, 2003 through December 31, 2003 $7.5
From January 1, 2004 through Maturity Date and thereafter $35.0 per fiscal year
provided, however, that (x) if the aggregate amount of Capital Expenditures
described in this clause (b) for any fiscal year shall be less than the amount
permitted in this clause (b) for such fiscal year (before giving effect to any
carryover), then the shortfall may be added to the amount of Capital
Expenditures permitted in this clause (b) for the immediately succeeding (but
not any other) fiscal year if the amount expended in such fiscal year would not
exceed 125% of the amount permitted for such fiscal year (before any carryover)
and (y) in determining whether any amount is available for carryover, the amount
expended in any fiscal year shall first be deemed to be from the amount
allocated to such year before any carryover.
(c) Minimum Excess Availability. Except for Overadvances outstanding
under Section 10.10, Borrower shall, at all times, cause the Excess Availability
to exceed $15.0 million.
SECTION 6.09 LIMITATION ON MODIFICATIONS OF INDEBTEDNESS; MODIFICATIONS
OF CERTIFICATE OF INCORPORATION, OR OTHER CONSTITUTIVE DOCUMENTS, BY-LAWS AND
CERTAIN OTHER AGREEMENTS, ETC. (i) Amend or modify, or permit the amendment or
modification of, any provision of existing Indebtedness or of any agreement
(including any purchase agreement, indenture, loan agreement or security
agreement) relating thereto other than any amendments or modifications to
Indebtedness which do not in any way materially adversely affect the interests
of the Lenders and are otherwise permitted under Section 6.01(b); (ii) except as
required by Sections 4.08 and 4.11(e) of the Qualified Senior Note Indenture,
make (or give any notice in respect thereof) any voluntary or optional payment
or prepayment on or redemption or acquisition for value of, or any prepayment or
redemption as a result of any asset sale, change of control or similar event of,
any indebtedness outstanding under the Qualified Senior Notes; (iii) amend or
modify, or permit the amendment or modification of, any provision of any
Qualified Senior Notes or any agreement (including any Qualified Senior Note
Document) relating thereto
121
other than amendments or modifications which do not in any way materially
adversely affect the interests of the Lenders and which are effected to make
technical corrections to the respective documentation; (iv) amend or modify, or
permit the amendment or modification of, any other Transaction Document, in each
case except for amendments or modifications which are not in any way adverse in
any material respect to the interests of the Lenders; or (v) amend, modify or
change its articles of incorporation or other constitutive documents (including
by the filing or modification of any certificate of designation) or by-laws, or
any agreement entered into by it, with respect to its capital stock (including
any shareholders' agreement), or enter into any new agreement with respect to
its capital stock, other than any amendments, modifications, agreements or
changes pursuant to this clause (v) or any such new agreements pursuant to this
clause (v) which do not in any way materially adversely affect in any material
respect the interests of the Lenders; and provided, that Holdings may issue such
capital stock as is not prohibited by Section 6.11 or any other provision of
this Agreement and may amend articles of incorporation or other constitutive
documents to authorize any such capital stock.
SECTION 6.10 LIMITATION ON CERTAIN RESTRICTIONS ON SUBSIDIARIES.
Directly or indirectly, create or otherwise cause or suffer to exist or become
effective any encumbrance or restriction on the ability of any Subsidiary to (a)
pay dividends or make any other distributions on its capital stock or any other
interest or participation in its profits owned by Borrower or any other
Subsidiary, or pay any Indebtedness owed to Borrower or any other Subsidiary
(except (i) solely with respect to restrictions on General Cable Spain's ability
to pay or make dividends as may be set forth in the European Term Loan Documents
and (ii) such other restrictions as are approved in writing and in advance by
the Administrative Agent), (b) make loans or advances to Borrower or any of
Borrower's other Subsidiaries or (c) transfer any of its properties to Borrower
or any of Borrower's other Subsidiaries, except for such encumbrances or
restrictions existing under or by reason of (i) applicable law; (ii) this
Agreement and the other Loan Documents; (iii) the Qualified Senior Note
Documents; (iv) customary provisions restricting subletting or assignment of any
lease governing a leasehold interest of Borrower or any other Subsidiary; (v)
customary provisions restricting assignment of any agreement entered into by
Borrower or any other Subsidiary in the ordinary course of business; (vi) any
holder of a Lien permitted by Section 6.02 may restrict the transfer of the
asset or assets subject thereto; (vii) restrictions which are not more
restrictive than those contained in this Agreement contained in any documents
governing any Indebtedness incurred after the Closing Date in accordance with
the provisions of this Agreement; (viii) customary restrictions and conditions
contained in any agreement relating to the sale of any Property permitted under
Section 6.05 pending the consummation of such sale; (ix) any agreement in effect
at the time such Subsidiary is a Subsidiary, so long as such agreement was not
entered into in contemplation of such Person becoming a Subsidiary; or (x) in
the case of any joint venture which is not a Loan Party in respect of any
matters referred to in clauses (b) and (c) above, restrictions in such Person's
organizational or governing documents or pursuant to any joint venture agreement
or stockholders agreements solely to the extent of the Equity Interests of or
assets held in the subject joint venture or other entity.
SECTION 6.11 LIMITATION ON ISSUANCE OF CAPITAL STOCK. (a) With respect
to Holdings, issue after the Closing Date any Equity Interest that is not
Qualified Capital Stock.
122
(b) Neither Intermediate Holdings nor Borrower will, and will not
permit any Subsidiary, to issue any Equity Interest of any Subsidiary (including
by way of sales of treasury stock) or any options or warrants to purchase, or
securities convertible into, Equity Interest of any Subsidiary, except (i) for
stock splits, stock dividends and additional Equity Interests issuances which do
not decrease the percentage ownership of Borrower or any Subsidiaries in any
class of the Equity Interest of such Subsidiary; (ii) Subsidiaries of Borrower
formed after the Closing Date pursuant to Section 6.12 may issue Equity
Interests to Borrower or the Subsidiary which is to own such stock; and (iii)
Borrower may issue common stock that is Qualified Capital Stock to Holdings. All
Equity Interests issued in accordance with this Section 6.11(b) shall, to the
extent required by Section 5.12 or the Security Agreements and Foreign Pledge
Agreements, be delivered to the Collateral Agent for pledge pursuant to the
Security Agreements and Foreign Pledge Agreements.
SECTION 6.12 LIMITATION ON CREATION OF SUBSIDIARIES. Establish, create
or acquire any additional Subsidiaries without the prior written consent of the
Required Lenders; provided, that (A) Intermediate Holdings may establish or
create one or more Foreign Subsidiaries to accomplish Permitted Non-Loan Funded
Acquisitions as long as, if such new Foreign Subsidiary is a first-tier Foreign
Subsidiary (a) 100% of the Equity Interest of any such Foreign Subsidiary is
upon the creation or establishment of any such new Subsidiary (or if such pledge
would have a material adverse tax impact on Intermediate Holdings (determined at
the reasonable judgment of the Administrative Agent after consultation with
Borrower), 65% of the Equity Interest is) pledged and delivered to the
Collateral Agent for the benefit of the Secured Parties under the Security
Agreements and Foreign Pledge Agreements or (B) Borrower may establish or create
one or more Wholly Owned Subsidiaries of Borrower or one of its Wholly Owned
Subsidiaries without such consent so long as (a) 100% of the Equity Interest of
any new Subsidiary is upon the creation or establishment of any such new
Subsidiary (or, in the case of Foreign Subsidiaries if such pledge would have a
material adverse tax impact on Borrower (determined at the reasonable judgment
of the Administrative Agent after consultation with Borrower), 65% of such
Equity Interest is) pledged and delivered to the Collateral Agent for the
benefit of the Secured Parties under the Security Agreements and Foreign Pledge
Agreements (other than fund non-Wholly Owned Subsidiaries acquired in connection
with a Permitted Acquisition or pursuant to Investments pursuant to Section
6.04(h)); (b) upon the creation or establishment of any such new Wholly Owned
Subsidiary, such Subsidiary becomes a party to the applicable Security Documents
and shall become a Guarantor hereunder and execute a Joinder Agreement and the
other Loan Documents all in accordance with Section 5.11(b) above and (c) such
new Subsidiary is a Domestic Subsidiary or a Canadian Subsidiary.
SECTION 6.13 BUSINESS. (a) With respect to Holdings, engage in any
business activities or have any assets or liabilities, other than (i) its
ownership of the Equity Interests of Borrower and other direct and indirect
Subsidiaries of Holdings and its performance of administrative and managerial
services on behalf of such Companies, (ii) obligations under the Transactions
Documents, and (iii) activities and assets incidental to the foregoing clauses
(i) and (ii).
(b) With respect to Borrower and the Subsidiaries of Holdings, engage
(directly or indirectly) in any business other than those businesses in which
Borrower and its Subsidiaries are
123
engaged on the Closing Date (or which are substantially related thereto or are
reasonable extensions thereof).
SECTION 6.14 LIMITATION ON ACCOUNTING CHANGES. Make or permit, any
change in accounting policies or reporting practices, without the consent of the
Required Lenders, which consent shall not be unreasonably withheld, except
changes that, in the aggregate, could not reasonably be expected to result in a
Material Adverse Effect or are required by GAAP.
SECTION 6.15 FISCAL YEAR. Change its fiscal year end to a date other
than December 31.
SECTION 6.16 NO NEGATIVE PLEDGES. Directly or indirectly enter into or
assume any agreement (other than this Agreement and the Qualified Senior Note
Documents) prohibiting the creation or assumption of any Lien upon its
properties or assets, whether now owned or hereafter acquired, except for
Property subject to purchase money security interests, operating leases and
capital leases and except for the prohibition of the creation of a Lien on the
Equity Interests or Properties of General Cable Spain as may be set forth in the
European Term Loan Documents.
SECTION 6.17 LEASE OBLIGATIONS. Create, incur, assume or suffer to
exist any obligations as lessee for the rental or hire of real or personal
Property of any kind under leases or agreements to lease having an original term
of one year or more that would cause the direct and contingent liabilities of
the Borrower and its Subsidiaries, on a consolidated basis, in respect of all
such obligations to exceed $15.0 million payable in any period of 12 consecutive
months.
SECTION 6.18 UPSTREAM RESTRICTIONS.
Directly or indirectly, create or otherwise cause or suffer to exist or
become effective any encumbrance or restriction on the ability of any Subsidiary
to (a) pay any dividend or make any other distributions on its capital stock or
any other Equity Interest (except (i) solely with respect to restrictions on
General Cable Spain's ability to pay or make dividends as may be set forth in
the European Term Loan Documents and (ii) such restrictions as are approved in
writing and in advance by the Administrative Agent) or (b) make or repay any
loans or advances to any parent of any Subsidiary, or (c) transfer assets from
any Subsidiary to its parent other than restrictions on transfers of Equipment
or Real Property that do not represent more than 5% of the consolidated assets
of the Holdings and its Subsidiaries.
SECTION 6.19 HOLDINGS COMPANIES; INACTIVE SUBSIDIARIES. (a) Except for
the ownership interest in Real Property set forth in Schedule 6.18 (and
Indebtedness evidenced by Qualified Senior Notes), (i) permit any Holding
Company to engage in any trade or business other than providing administrative
and managerial services on behalf of the Companies , (ii) own any assets (other
than Equity Interests and Indebtedness, including intercompany Indebtedness,
which are pledged to the Collateral Agent on the Closing Date) or (iii) incur
any liability (other than for the Obligations, intercompany Indebtedness and the
Indebtedness evidenced by Qualified Senior Notes) in an aggregate amount that
exceeds $25,000.
(b) Cause or permit any Domestic or Canadian Inactive Subsidiary to (i)
own any assets with an aggregate book value in excess of $25,000 (or, in the
case of General Cable Canada, Limited, an Ontario corporation, an aggregate book
value in excess of $25,000 plus the
124
aggregate book value of its assets as of the Closing Date) other than
Indebtedness, including intercompany Indebtedness, and Equity Interests on the
Closing Date pledged to the Collateral Agent, (ii) incur any liability (other
than for the Obligations, intercompany Indebtedness and the Indebtedness
evidenced by the Qualified Senior Notes) in an aggregate amount that exceeds
$25,000 or (iii) engage in any trade or business.
SECTION 6.20 MATERIAL AGREEMENTS. No Company shall, without the prior
written consent of the Administrative Agent and the Collateral Agent, in their
reasonable collective credit judgments, change or amend the terms of any
Intercompany Agreement; and there shall not have occurred the termination of, or
the receipt by any Loan Party of notice of the termination of, or the occurrence
of any event or condition which would, with the passage of time or the giving of
notice or both, constitute an event of default under or permit the termination
of, any one or more of the Intercompany Agreements, which occurrence, unless
otherwise determined by the Administrative Agent in its reasonable judgment,
shall constitute an Event of Default hereunder.
ARTICLE VII.
GUARANTEE
SECTION 7.01 THE GUARANTEE. The Guarantors (other than General Cable
Canada, which has contemporaneously herewith executed and delivered the Canadian
Guaranty and other than Foreign Guarantors, which have contemporaneously
herewith executed and delivered Foreign Guaranties) hereby jointly and severally
guarantee as a primary obligor and not as a surety to each Secured Party and
their respective successors and assigns the prompt payment in full when due
(whether at stated maturity, by acceleration or otherwise) of the principal of
and interest (including any interest, fees, costs or charges that would accrue
but for the provisions of the Title 11 of the United States Code after any
bankruptcy or insolvency petition under Title 11 of the United States Code) on
the Loans made by the Lenders to, and the Notes held by each Lender of,
Borrower, and all other Obligations from time to time owing to the Secured
Parties by any Loan Party under any Loan Document or Interest Rate Protection
Agreement relating to the Loans, in each case strictly in accordance with the
terms thereof (such obligations being herein collectively called the "GUARANTEED
OBLIGATIONS"). The Guarantors hereby jointly and severally agree that if
Borrower or other Guarantor(s) shall fail to pay in full when due (whether at
stated maturity, by acceleration or otherwise) any of the Guaranteed
Obligations, the Guarantors will promptly pay the same, without any demand or
notice whatsoever, and that in the case of any extension of time of payment or
renewal of any of the Guaranteed Obligations, the same will be promptly paid in
full when due (whether at extended maturity, by acceleration or otherwise) in
accordance with the terms of such extension or renewal.
SECTION 7.02 OBLIGATIONS UNCONDITIONAL. The obligations of the
Guarantors under Section 7.01 shall constitute a guaranty of payment and are
absolute, irrevocable and unconditional, joint and several, irrespective of the
value, genuineness, validity, regularity or enforceability of the Guaranteed
Obligations of Borrower under this Agreement, the Notes, if any, or any other
agreement or instrument referred to herein or therein, or any substitution,
release or exchange of any other guarantee of or security for any of the
Guaranteed Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance
125
whatsoever that might otherwise constitute a legal or equitable discharge or
defense of a surety or Guarantor (except for payment in full). Without limiting
the generality of the foregoing, it is agreed that the occurrence of any one or
more of the following shall not alter or impair the liability of the Guarantors
hereunder which shall remain absolute, irrevocable and unconditional under any
and all circumstances as described above:
(a) the genuineness, validity, regularity, enforceability
or any future amendment of, or change in, this Agreement, any other
Loan Document or any other agreement, document or instrument to which
Borrower is or may become a party;
(b) the absence of any action to enforce this Agreement
or any other Loan Document or the waiver or consent by Administrative
Agent and Lenders with respect to any of the provisions thereof;
(c) the existence, value or condition of, or failure to
perfect its Lien against, any security for the Obligations or any
action, or the absence of any action, by Administrative Agent and
Lenders in respect thereof (including the release of any such
security);
(d) the insolvency of Borrower or any other Guarantor;
(e) at any time or from time to time, without notice to
the Guarantors, the time for any performance of or compliance with any
of the Guaranteed Obligations shall be extended, or such performance or
compliance shall be waived;
(f) any of the acts mentioned in any of the provisions of
this Agreement or the Notes, if any, or any other agreement or
instrument referred to herein or therein shall be done or omitted;
(g) the maturity of any of the Guaranteed Obligations
shall be accelerated, or any of the Guaranteed Obligations shall be
amended in any respect, or any right under the Loan Documents or any
other agreement or instrument referred to herein or therein shall be
amended or waived in any respect or any other guarantee of any of the
Guaranteed Obligations or any security therefor shall be released or
exchanged in whole or in part or otherwise dealt with;
(h) any lien or security interest granted to, or in favor
of, Issuing Bank or any Lender or Agent as security for any of the
Guaranteed Obligations shall fail to be perfected;
(i) the release of Borrower or any other Guarantor; or
(j) any other action or circumstances that might
otherwise constitute a legal or equitable discharge or defense of a
surety or guarantor (other than indefeasible payment in full in cash of
all Obligations and the termination of all Commitments).
The Guarantors hereby expressly waive diligence, presentment, demand of
payment, protest and all notices whatsoever, and any requirement that any Loan
Party thereof exhaust any
126
right, power or remedy or proceed against Borrower under this Agreement or the
Notes, if any, or any other agreement or instrument referred to herein or
therein, or against any other Person under any other guarantee of, or security
for, any of the Guaranteed Obligations. The Guarantors waive any and all notice
of the creation, renewal, extension, waiver, termination or accrual of any of
the Guaranteed Obligations and notice of or proof of reliance by any Secured
Party upon this Guarantee or acceptance of this Guarantee, and the Guaranteed
Obligations, and any of them, shall conclusively be deemed to have been created,
contracted or incurred in reliance upon this Guarantee, and all dealings between
Borrower and the Secured Parties shall likewise be conclusively presumed to have
been had or consummated in reliance upon this Guarantee. This Guarantee shall be
construed as a continuing, absolute, irrevocable and unconditional guarantee of
payment without regard to any right of offset with respect to the Guaranteed
Obligations at any time or from time to time held by Secured Parties, and the
obligations and liabilities of the Guarantors hereunder shall not be conditioned
or contingent upon the pursuit by the Secured Parties or any other Person at any
time of any right or remedy against Borrower or against any other Person which
may be or become liable in respect of all or any part of the Guaranteed
Obligations or against any collateral security or guarantee therefor or right of
offset with respect thereto. This Guarantee shall remain in full force and
effect and be binding in accordance with and to the extent of its terms upon the
Guarantors and the successors and assigns thereof, and shall inure to the
benefit of the Lenders, and their respective successors and assigns,
notwithstanding that from time to time during the term of this Agreement there
may be no Guaranteed Obligations outstanding.
SECTION 7.03 REINSTATEMENT. The obligations of the Guarantors under
this Article VII shall be automatically reinstated if and to the extent that for
any reason any payment by or on behalf of Borrower or other Loan Party in
respect of the Guaranteed Obligations is rescinded or must be otherwise restored
by any holder of any of the Guaranteed Obligations, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise. The Guarantors jointly
and severally agree that they will indemnify each Secured Party on demand for
all reasonable costs and expenses (including reasonable fees of counsel)
incurred by such Secured Party in connection with such rescission or
restoration, including any such costs and expenses incurred in defending against
any claim alleging that such payment constituted a preference, fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law,
other than any costs or expenses resulting from the bad faith or willful
misconduct of such Secured Party.
SECTION 7.04 SUBROGATION; SUBORDINATION. Each Guarantor hereby agrees
that until the indefeasible payment and satisfaction in full in cash of all
Guaranteed Obligations and the expiration and termination of the Commitments of
the Lenders under this Agreement it shall not exercise any right or remedy
arising by reason of any performance by it of its guarantee in Section 7.01,
whether by subrogation or otherwise, against Borrower or any other Guarantor of
any of the Guaranteed Obligations or any security for any of the Guaranteed
Obligations. The payment of any amounts due with respect to any Indebtedness of
Borrower or any other Guarantor now or hereafter owing to any Guarantor or
Borrower by reason of any payment by such Guarantor under the Guarantee in this
Article VII is hereby subordinated to the prior indefeasible payment in full in
cash of the Guaranteed Obligations. In addition, any Indebtedness of the
Guarantors now or hereafter held by any Guarantor is hereby subordinated in
right of payment in full in cash to the Guaranteed Obligations. Each Guarantor
agrees that it will not demand, xxx for or otherwise attempt to collect any such
Indebtedness of Borrower to such
127
Guarantor until the Obligations shall have been indefeasibly paid in full in
cash. If, notwithstanding the foregoing sentence, any Guarantor shall prior to
the indefeasible payment in full in cash of the Guaranteed Obligations collect,
enforce or receive any amounts in respect of such Indebtedness, such amounts
shall be collected, enforced and received by such Guarantor as trustee for the
Secured Parties and be paid over to Administrative Agent on account of the
Guaranteed Obligations without affecting in any manner the liability of such
Guarantor under the other provisions of the guaranty contained herein.
SECTION 7.05 REMEDIES. The Guarantors jointly and severally agree that,
as between the Guarantors and the Lenders, the obligations of Borrower under
this Agreement and the Notes, if any, may be declared to be forthwith due and
payable as provided in Article XI (and shall be deemed to have become
automatically due and payable in the circumstances provided in said Article XI)
for purposes of Section 7.01, notwithstanding any stay, injunction or other
prohibition preventing such declaration (or such obligations from becoming
automatically due and payable) as against Borrower and that, in the event of
such declaration (or such obligations being deemed to have become automatically
due and payable), such obligations (whether or not due and payable by Borrower)
shall forthwith become due and payable by the Guarantors for purposes of Section
7.01.
SECTION 7.06 INSTRUMENT FOR THE PAYMENT OF MONEY. Each Guarantor hereby
acknowledges that the guarantee in this Article VII constitutes an instrument
for the payment of money, and consents and agrees that any Lender or Agent, at
its sole option, in the event of a dispute by such Guarantor in the payment of
any moneys due hereunder, shall have the right to bring a motion-action under
New York CPLR Section 3213.
SECTION 7.07 CONTINUING GUARANTEE. The guarantee in this Article VII is
a continuing guarantee of payment, and shall apply to all Guaranteed Obligations
whenever arising.
SECTION 7.08 GENERAL LIMITATION ON GUARANTEE OBLIGATIONS. In any action
or proceeding involving any state corporate law, or any state, federal or
foreign bankruptcy, insolvency, reorganization or other law affecting the rights
of creditors generally, if the obligations of any Guarantor under Section 7.01
would otherwise be held or determined to be void, voidable, invalid or
unenforceable, or subordinated to the claims of any other creditors, on account
of the amount of its liability under Section 7.01, then, notwithstanding any
other provision to the contrary, the amount of such liability shall, without any
further action by such Guarantor, any Loan Party or any other Person, be
automatically limited and reduced to the highest amount that is valid and
enforceable and not subordinated to the claims of other creditors as determined
in such action or proceeding.
128
ARTICLE VIII.
EVENTS OF DEFAULT
In case of the happening of any of the following events ("EVENTS OF
DEFAULT"):
(a) default shall be made in the payment of any principal
of any Loan or the reimbursement with respect to any LC Disbursement
when and as the same shall become due and payable, whether at the due
date thereof or at a date fixed for prepayment thereof or by
acceleration thereof or otherwise;
(b) default shall be made in the payment of any interest
on any Loan or any Fee or any other amount (other than an amount
referred to in (a) above) due under any Loan Document, when and as the
same shall become due and payable, and such default shall continue
unremedied for a period of three Business Days;
(c) any representation or warranty made or deemed made in
or in connection with any Loan Document or the borrowings or issuances
of Letters of Credit hereunder, or any representation, warranty,
statement or information contained in any report, certificate,
financial statement or other instrument furnished in connection with or
pursuant to any Loan Document, shall prove to have been false or
misleading in any material respect when so made, deemed made or
furnished; it being recognized by Lenders, however, that projections as
to future events are not to be viewed as facts and that the actual
results during the period or periods covered by said projections may
differ from the projected results;
(d) default shall be made in the due observance or
performance by any Company of any covenant, condition or agreement
contained in Section 5.02, 5.03, 5.08, 5.16 or in Article VI;
(e) default shall be made in the due observance or
performance by any Company of any covenant, condition or agreement
contained in Section 5.01 or 5.15 and such default shall continue
unremedied or shall not be waived for a period of 5 days;
(f) default shall be made in the due observance or
performance by any Company of any covenant, condition or agreement
contained in any Loan Document (other than those specified in
paragraphs (a), (b), (d) or (e) above) and such default shall continue
unremedied or shall not be waived for a period of 20 days after written
notice thereof from the Administrative Agent or any Lender to Borrower;
(g) any Company shall (i) fail to pay any principal or
interest, regardless of amount, due in respect of any Indebtedness
(other than the Obligations), when and as the same shall become due and
payable, or (ii) fail to observe or perform any other term, covenant,
condition or agreement contained in any agreement or instrument
evidencing or governing any such Indebtedness if the effect of any
failure referred to in clauses (i) and (ii) is to cause, or to permit
the holder or holders of such Indebtedness or a trustee on its or their
behalf (with or without the giving of notice, the lapse of time or
both) to cause, such Indebtedness to become due prior to its stated
maturity; provided, that it shall not
129
constitute an Event of Default pursuant to this paragraph (f) unless
the aggregate amount of all such Indebtedness referred to in clauses
(i) and (ii) exceeds $100,000 at any one time;
(h) an involuntary proceeding shall be commenced or an
involuntary petition shall be filed in a court of competent
jurisdiction seeking (i) relief in respect of any Domestic or Canadian
Company (other than any Domestic or Canadian Company which is an
Inactive Company and with respect to which the book value of its
tangible assets does not exceed the Dollar Equivalent of $3.0 million)
or any Foreign Company with respect to which the book value of its
tangible assets exceeds the Dollar Equivalent of $3.0 million, or of a
substantial part of the Property or assets of any Company, under Title
11 of the United States Code, as now constituted or hereafter amended,
BIA, CCAA or any other federal, state or foreign bankruptcy,
insolvency, receivership or similar law; (ii) the appointment of a
receiver, trustee, custodian, sequestrator, conservator or similar
official for any such Company or for a substantial part of the Property
or assets of any such Company; or (iii) the winding-up or liquidation
of any such Company; and, in any such case, such proceeding or petition
shall continue undismissed for 60 days or an order or decree approving
or ordering any of the foregoing shall be entered;
(i) any Domestic or Canadian Company or any Foreign
Company with respect to which the book value of its tangible assets
exceeds the Dollar Equivalent of $3.0 million shall (i) voluntarily
commence any proceeding or file any petition seeking relief under Title
11 of the United States Code, as now constituted or hereafter amended,
or any other federal, state or foreign bankruptcy, insolvency,
receivership or similar law; (ii) consent to the institution of, or
fail to contest in a timely and appropriate manner, any proceeding or
the filing of any petition described in (g) above; (iii) apply for or
consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for any such Company or
for a substantial part of the Property or assets of any such Company;
(iv) file an answer admitting the material allegations of a petition
filed against it in any such proceeding; (v) make a general assignment
for the benefit of creditors; (vi) become unable (after taking into
account all rights of contribution), admit in writing its inability or
fail generally to pay its debts as they become due; (vii) take any
action for the purpose of effecting any of the foregoing; or (viii)
wind up or liquidate;
(j) one or more judgments for the payment of money in an
aggregate amount in excess of $1.0 million shall be rendered against
any Company or any combination thereof and the same shall remain
undischarged for a period of 30 consecutive days during which execution
shall not be effectively stayed, or any action shall be legally taken
by a judgment creditor to levy upon assets or properties of any Company
to enforce any such judgment;
(k) an ERISA Event or noncompliance with respect to
Foreign Plans shall have occurred that, in the reasonable opinion of
the Required Lenders, when taken together with all other such ERISA
Events and noncompliance with respect to Foreign Plans that have
occurred, could reasonably be expected to result in liability of any
Domestic or Canadian Company and its ERISA Affiliates in an aggregate
amount exceeding $500,000 or the imposition of a Lien on any assets of
a Company;
130
(l) any security interest and Lien purported to be
created by any Security Document shall cease to be in full force and
effect, or shall cease to give the Collateral Agent, for the benefit of
the Secured Parties, the Liens, rights, powers and privileges purported
to be created and granted under such Security Documents (including a
perfected first priority security interest in and Lien on, all of the
Collateral thereunder (except as otherwise expressly provided in such
Security Document)) in favor of the Collateral Agent, or shall be
asserted by Borrower or any other Loan Party not to be, a valid,
perfected, first priority (except as otherwise expressly provided in
this Agreement or such Security Document) security interest in or Lien
on the Collateral covered thereby;
(m) the Guarantees shall cease to be in full force and
effect, unless in connection with the sale, merger or dissolution of a
Guarantor to the extent permitted under Section 6.05 hereof;
(n) any Loan Document or any material provisions thereof
shall at any time and for any reason be declared by a court of
competent jurisdiction to be null and void, or a proceeding shall be
commenced by any Loan Party or any other Person, or by any Governmental
Authority, seeking to establish the invalidity or unenforceability
thereof (exclusive of questions of interpretation of any provision
thereof), or any Loan Party shall repudiate or deny that it has any
liability or obligation for the payment of principal or interest or
other obligations purported to be created under any Loan Document;
(o) there shall have occurred a Change in Control;
(p) any Loan Party shall be prohibited or otherwise
restrained from conducting the business theretofore conducted by it in
any manner that has or could reasonably be expected to result in a
Material Adverse Effect by virtue of any determination, ruling,
decision, decree or order of any court or Governmental Authority of
competent jurisdiction; or
(q) the indictment by any Governmental Authority of any
Loan Party as to which any Loan Party or Administrative Agent receives
notice as to which there is a reasonable possibility of an adverse
determination, in the good faith determination of Administrative Agent,
under any criminal statute, or commencement of criminal or civil
proceedings against any Loan Party pursuant to which statute or
proceedings the penalties or remedies sought or available include
forfeiture of (i) any of the Collateral having a value in excess of
$1.0 million or (ii) any other Property of any Loan Party which is
necessary or material to the conduct of its business;
then, and in every such event (other than an event with respect to Holdings or
Borrower described in paragraph (g) or (h) above), and at any time thereafter
during the continuance of such event, the Administrative Agent or the Collateral
Agent may, and at the request of the Required Lenders shall, by notice to
Borrower, take either or both of the following actions, at the same or different
times: (i) terminate forthwith the Commitments and (ii) declare the Loans then
outstanding to be forthwith due and payable in whole or in part, whereupon the
principal of the Loans so declared to be due and payable, together with accrued
interest thereon and any unpaid accrued Fees and all other liabilities of
Borrower accrued hereunder and under any other Loan
131
Document, shall become forthwith due and payable, without presentment, demand,
protest or any other notice of any kind, all of which are hereby expressly
waived by Borrower and the Guarantors, anything contained herein or in any other
Loan Document to the contrary notwithstanding; and in any event with respect to
Holdings or Borrower described in paragraph (g) or (h) above, the Commitments
shall automatically terminate and the principal of the Loans then outstanding,
together with accrued interest thereon and any unpaid accrued Fees and all other
liabilities of Borrower accrued hereunder and under any other Loan Document,
shall automatically become due and payable, without presentment, demand, protest
or any other notice of any kind, all of which are hereby expressly waived by
Borrower and the Guarantors, anything contained herein or in any other Loan
Document to the contrary notwithstanding.
ARTICLE IX.
COLLATERAL MATTERS; CASH COLLATERAL ACCOUNTS; APPLICATION OF
COLLATERAL PROCEEDS
SECTION 9.01 ACCOUNTS AND ACCOUNT COLLECTIONS.
(a) Borrower and each Borrowing Base Guarantor shall notify Collateral
Agent promptly of: (i) any material delay in the performance by Borrower or any
Borrowing Base Guarantor of any of their material obligations to any Account
Debtor or the assertion of any material claims, offsets, defenses or
counterclaims by any Account Debtor, or any material disputes with Account
Debtors, or any settlement, adjustment or compromise thereof, (ii) all material
adverse information known to any Loan Party relating to the financial condition
of any Account Debtor and (iii) any event or circumstance which, to any Loan
Party's knowledge, would result in any Account no longer constituting an
Eligible Account. Borrower and each Borrowing Base Guarantor hereby agree not to
grant to any Account Debtor any credit, discount, allowance or extension, or to
enter into any agreement for any of the foregoing, without Collateral Agent's
consent, except in the ordinary course of business in accordance with practices
and policies previously disclosed in writing to Collateral Agent. So long as no
Event of Default exists or has occurred and is continuing, Borrower and each
Borrowing Base Guarantor may settle, adjust or compromise any claim, offset,
counterclaim or dispute with any Account Debtor. At any time that an Event of
Default exists or has occurred and is continuing, Collateral Agent shall, at its
option, have the exclusive right to settle, adjust or compromise any claim,
offset, counterclaim or dispute with Account Debtors of any Loan Party or grant
any credits, discounts or allowances.
(b) With respect to each Account: (i) the amounts shown on any invoice
delivered to Collateral Agent or schedule thereof delivered to Collateral Agent
shall be true and complete in all material respects, (ii) no payments shall be
made thereon except payments immediately delivered to Collateral Agent pursuant
to the terms of this Agreement or any applicable Security Document (to the
extent so required), (iii) there shall be no setoffs, deductions, contras,
defenses, counterclaims or disputes existing or asserted with respect thereto
except as reported to Collateral Agent and promptly reflected in the reporting
of the Borrowing Base, in accordance with the terms of this Agreement, and (iv)
none of the transactions giving rise thereto will violate any applicable laws or
regulations, all documentation relating thereto will be legally sufficient under
such laws and regulations and all such documentation will be legally enforceable
in accordance with its terms.
132
(c) Collateral Agent shall have the right at any time or times, in
Collateral Agent's name or in the name of a nominee of Collateral Agent, to
verify the validity, amount or any other matter relating to any Account or other
Collateral, by mail, telephone, e-mail, facsimile transmission or otherwise. To
facilitate the exercise of the right described in the immediately preceding
sentence, Borrower hereby agrees to provide Collateral Agent upon request the
name and address of each Account Debtor of Borrower or any Borrowing Base
Guarantor.
(d) Borrower shall establish and maintain, at its sole expense, and
shall cause each Guarantor to establish and maintain, at its sole expense
blocked accounts or lockboxes and related deposit accounts (collectively, the
"BLOCKED ACCOUNTS"), as Collateral Agent may specify, with such banks as are
acceptable to Collateral Agent into which Borrower and Guarantors shall promptly
deposit and direct their respective Account Debtors to directly remit all
payments on Accounts and all payments constituting proceeds of Inventory or
other Collateral (other than proceeds of a Casualty Event or Asset Sales that do
not require a permanent repayment under Loan Documents) in the identical form in
which such payments are made, whether by cash, check or other manner and shall
be identified and segregated from all other funds of the Loan Parties. Borrower
and Guarantors shall deliver, or cause to be delivered, to Collateral Agent a
Deposit Account Control Agreement duly authorized, executed and delivered by
each bank where a Blocked Account for the benefit of Borrower or any Guarantor
is maintained, and by each bank where any other deposit account is from time to
time maintained. Borrower shall further execute and deliver, and shall cause
each Guarantor to execute and deliver, such agreements and documents as
Collateral Agent may require in connection with such Blocked Accounts and such
Deposit Account Control Agreements. Except as permitted by Section 9.01(e)(iii),
Borrower and Guarantors shall not establish any deposit accounts after the
Closing Date, unless Borrower or Guarantor (as applicable) have complied in full
with the provisions of this Section 9.01 with respect to such deposit accounts.
Borrower agrees that all payments made to such Blocked Accounts or other funds
received and collected by Collateral Agent or any Lender, whether in respect of
the Accounts, as proceeds of Inventory or other Collateral or otherwise shall be
treated as payments to Collateral Agent and Lenders in respect of the
Obligations and therefore shall constitute the property of Collateral Agent and
Lenders to the extent of the then outstanding Obligations.
(e) The Borrower and each Guarantor shall maintain a cash management
system which is acceptable to the Administrative Agent and the Collateral Agent
(the "CASH MANAGEMENT SYSTEM"). The Cash Management System shall contain, among
other things, the following:
(i) With respect to the Blocked Accounts of Borrower and
such Guarantors as the Collateral Agent shall determine in its sole discretion,
the applicable bank maintaining such Blocked Accounts shall agree, pursuant to
the applicable Deposit Account Control Agreement, to forward daily all amounts
in each Blocked Account to one Blocked Account designated as concentration
account in the name of Borrower (the "CONCENTRATION ACCOUNT") at the bank that
shall be designated as the Concentration Account bank for Borrower (the
"CONCENTRATION ACCOUNT BANK"), which, on the Closing Date, shall be account
#0000000000 maintained by PNC Bank, National Association. The Concentration
Account Bank shall agree, pursuant to the applicable Deposit Account Control
Agreement, to forward daily all amounts in the Concentration Account to the
account designated as collection account (the "COLLECTION ACCOUNT") which shall
be under the exclusive dominion and control of the Collateral Agent;
133
(ii) With respect to the Blocked Accounts of such
Guarantors as the Collateral Agent shall determine in its sole discretion, the
applicable bank maintaining such Blocked Accounts shall agree, from and after
the receipt of a notice (an "ACTIVATION NOTICE") from the Collateral Agent
(which Activation Notice may be given by Collateral Agent at any time in its
discretion), to forward all amounts in each Blocked Account to the applicable
Collection Account and to commence the process of daily sweeps from such Blocked
Account into the Collection Account;
(iii) Borrower may maintain, in its name, an account or
accounts at a bank reasonably acceptable to Administrative Agent, into which
Administrative Agent shall, from time to time, deposit proceeds of Revolving
Loans and Swingline Loans made to Borrower hereunder and which bank shall agree,
pursuant to Deposit Account Control Agreement relative to such disbursement
account, from and after the receipt of a notice from the Collateral Agent (which
notice may be given by Collateral Agent at any time an Event of Default occurs
and is continuing) to forward all amounts in each Blocked Account to the
applicable Collection Account. Any provision of this Section 9.01 to the
contrary notwithstanding, (A) Loan Parties may maintain payroll accounts and
trust accounts that are not a part of the Cash Management Systems provided that
no Loan Party shall accumulate or maintain cash in such accounts and the
disbursement account(s) described in the preceding sentence as of any date of
determination in excess of checks outstanding against such accounts as of that
date and amounts necessary to meet minimum balance requirements and (B) Loan
Parties may maintain local cash accounts that are not a part of the Cash
Management Systems which individually do not at any time contain funds in excess
of $100,000 and, together with all other such local cash accounts, do not exceed
$1.0 million.
(f) The Administrative Agent shall apply all funds received in the
Collection Account on a daily basis to the repayment (by transferring same to
the account of or pursuant to direction of Administrative Agent) of (i) first,
Fees and reimbursable expenses of the Administrative Agent and the Collateral
Agent then due and payable; (ii) second, to interest then due and payable on all
Loans, (iii) third, Overadvances, (iv) fourth, the Swingline Loans, (v) fifth,
ABR Revolving Loans, (vi) sixth, Eurodollar Revolving Loans, together with all
accrued and unpaid interest thereon (excluding Eurodollar Revolving Loans (A)
with respect to which the application of such payment would result in the
payment of the principal prior to the last day of the relevant Interest Period
and (B) which Borrower elects to continue pursuant to Section 2.08(b)), and
(vii) last, other amounts which are due, in each case without a reduction in the
Commitments; all further funds received in any of the Collection Account shall,
unless an Event of Default has occurred and is continuing, be transferred or
applied by the Collateral Agent in accordance with the directions of Borrower or
the respective other Loan Party. If an Event of Default has occurred and is
continuing, the Administrative Agent shall not transfer or apply any such funds
from the Collection Account in accordance with such directions unless the
Administrative Agent and the Collateral Agent determine to release such funds to
Borrower. Absent any such determination by the Administrative Agent and the
Collateral Agent, all such funds in the Collection Account shall be transferred
to the Cash Collateral Account to be applied to the Eurodollar Revolving Loans
on the last day of the relevant Interest Period of such Eurodollar Revolving
Loan or to the Obligations as they come due (whether at stated maturity, by
acceleration or otherwise). If consented to by the Administrative Agent, the
Collateral Agent and the Required Lenders, such funds in the Cash Collateral
Account may be released to Borrower.
134
(g) Borrower and its directors, employees, agents and other Affiliates
and Borrowing Base Guarantors shall, acting as trustee for Collateral Agent,
receive, as the property of Collateral Agent, any monies, checks, notes, drafts
or any other payment relating to and/or proceeds of Accounts, Inventory or other
Collateral which come into their possession or under their control and
immediately upon receipt thereof, shall deposit or cause the same to be
deposited in the Blocked Accounts, or remit the same or cause the same to be
remitted, in kind, to Collateral Agent. In no event shall the same be commingled
with Borrower's own funds. Borrower agrees to reimburse Collateral Agent on
demand for any amounts owed or paid to any bank at which a Blocked Account is
established or any other bank or Person involved in the transfer of funds to or
from the Blocked Accounts arising out of Collateral Agent's payments to or
indemnification of such bank or Person.
(h) With respect to the accounts #4005296996 and #4005297008 maintained
at PNC Bank, National Association, Loan Parties represent and warrant that no
more than $2,500 in the aggregate is on deposit therein and covenant and agree
that no Loan Party shall deposit or suffer to be deposited therein any funds,
and Loan Parties shall terminate such accounts no later than December 24, 2003,
on or before which date Borrower agrees to deliver to the Administrative Agent
evidence of such termination.
SECTION 9.02 INVENTORY; FIELD AUDITS AND APPRAISALS. With respect to
the Inventory: (a) Borrower and Borrowing Base Guarantors shall at all times
maintain records of Inventory reasonably satisfactory to Collateral Agent,
keeping correct and accurate records itemizing and describing the kind, type,
quality and quantity of Inventory, the cost therefor and daily withdrawals
therefrom and additions thereto; (b) any of the Administrative Agent's and
Collateral Agent's officers, employees or agents shall have the right, at any
time or times, in the name of the Administrative Agent or Collateral Agent, as
applicable, any designee of the Administrative Agent, Collateral Agent or
Borrower, to verify the validity, amount or any other matter relating to
Accounts or Inventory by mail, telephone, electronic communication, personal
inspection or otherwise and to conduct field audits of the financial affairs and
Collateral of the Loan Parties, and Borrower shall cooperate fully with the
Administrative Agent and Collateral Agent in an effort to facilitate and
promptly conclude any such verification process; (c) the Loan Parties shall
cooperate fully with the Collateral Agent and its agents during all Collateral
field audits and Inventory Appraisals which shall be at the expense of Borrower
and which shall be conducted no more frequently than quarterly, or, following
the occurrence and during the continuation of an Event of Default, more
frequently at Collateral Agent's request; (d) neither Borrower nor any Borrowing
Base Guarantor shall sell Inventory to any customer on approval, or any other
basis which entitles the customer to return (except for the right of customers
for Inventory which is defective or non-conforming) or may obligate any Loan
Party to repurchase such Inventory; and (e) Borrower Borrowing Base Guarantor
shall keep the Inventory in good and marketable condition.
SECTION 9.03 EQUIPMENT, REAL PROPERTY AND APPRAISALS.
With respect to the Equipment and owned Real Property: (a) upon the
Collateral Agent's request, Borrower shall, at its expense, no more than one (1)
time in any twelve (12) month period commencing with the Closing Date, but at
any time or times as the Collateral Agent may request following the occurrence
and during the continuance of an Event of Default, deliver or
135
cause to be delivered to the Collateral Agent written appraisals as to the
Equipment and/or the owned Real Property by an independent appraiser designated
by the Collateral Agent and reasonably acceptable to Borrower, (b) Borrower and
each Borrowing Base Guarantor shall notify Collateral Agent promptly of any
event or circumstance which, to any Loan Party's knowledge, would result in any
Equipment no longer constituting an Eligible Equipment and (c) Borrower and each
Borrowing Base Guarantor shall notify Collateral Agent promptly of any event or
circumstance which, to any Loan Party's knowledge, would result in any Real
Property no longer constituting an Eligible Real Property.
SECTION 9.04 CASH COLLATERAL ACCOUNT.
(a) The Collateral Agent is hereby authorized to establish and maintain
at its office at 000 Xxxxx XxXxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxxxxx 00000,
in the name of the Collateral Agent and pursuant to a dominion and control
Agreement, one or more restricted deposit account designated as a "CASH
COLLATERAL ACCOUNT" bearing the name of the owners of the funds contained
therein (e.g., General Cable Industries Inc. - Cash Collateral Account). Each
Loan Party shall deposit into its respective Cash Collateral Account from time
to time the cash collateral required to be deposited under Section 2.18(j) or
Section 9.01(f) hereof.
(b) The balance from time to time in such Cash Collateral Accounts
shall constitute part of the Collateral and shall not constitute payment of the
Obligations until applied as hereinafter provided. Notwithstanding any other
provision hereof to the contrary, all amounts held in the Cash Collateral
Accounts shall constitute collateral security (i) first for the liabilities in
respect of Letters of Credit outstanding from time to time and second for the
other Obligations hereunder until such time as all Letters of Credit shall have
been terminated and all of the liabilities in respect of Letters of Credit have
been paid in full, and (ii) if held in Cash Collateral Account pursuant to
Section 9.01(f), then for the Obligations as provided therein.
SECTION 9.05 APPLICATION OF PROCEEDS. The proceeds received by the
Collateral Agent in respect of any sale of, collection from or other realization
upon all or any part of the Collateral pursuant to the exercise by the
Collateral Agent of its remedies shall be applied, together with any other sums
then held by the Collateral Agent pursuant to this Agreement, promptly by the
Collateral Agent as follows (with, in the case of proceeds from a Borrowing Base
Guarantor, a corresponding reduction in the Borrowing Base Guarantor
Intercompany Loan Account):
(a) First, to the payment of all reasonable costs and
expenses, fees, commissions and taxes of such sale, collection or other
realization including, without limitation, compensation to the
Collateral Agent and its agents and counsel, and all expenses,
liabilities and advances made or incurred by the Collateral Agent in
connection therewith, together with interest on each such amount at the
highest rate then in effect under this Agreement from and after the
date such amount is due, owing or unpaid until paid in full;
(b) Second, to the payment of all other reasonable costs
and expenses of such sale, collection or other realization including,
without limitation, costs and expenses and all costs, liabilities and
advances made or incurred by the other Secured Parties in
136
connection therewith, together with interest on each such amount at the
highest rate then in effect under this Agreement from and after the
date such amount is due, owing or unpaid until paid in full;
(c) Third, without duplication of amounts applied
pursuant to paragraphs (a) and (b) above, to the indefeasible payment
in full in cash, of each Lender's Default Allocation Percentage of
interest, principal and other amounts constituting Obligations, equally
and ratably in accordance with each Lender's Default Allocation
Percentage of such amounts; and
(d) Fourth, the balance, if any, to the Person lawfully
entitled thereto (including the applicable Loan Party or its successors
or assigns).
In the event that any such proceeds are insufficient to pay in full the
items described in clauses (a) through (c) of this Section 9.02, the Loan
Parties shall remain liable for any deficiency.
ARTICLE X.
THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT
SECTION 10.01 APPOINTMENT. (a) Each Lender hereby irrevocably
designates and appoints UBS as the Administrative Agent under this Agreement and
the other Loan Documents, and each Lender irrevocably authorizes UBS, in its
capacity as the Administrative Agent, to take such actions on its behalf under
the provisions of this Agreement and the other Loan Documents and to exercise
such powers as are expressly delegated to the Administrative Agent by the terms
of this Agreement and the other Loan Documents, together with such actions and
powers as are reasonably incidental thereto.
(b) Each Secured Party hereby irrevocably designates and appoints
Xxxxxxx as the Collateral Agent under this Agreement and the other Loan
Documents, and each Lender irrevocably authorizes Xxxxxxx its capacity as the
Collateral Agent, to take such actions on its behalf under the provisions of
this Agreement and the other Loan Documents and to exercise such powers as are
expressly delegated to the Collateral Agent by the terms of this Agreement and
the other Loan Documents, together with such actions and powers as are
reasonably incidental thereto. Except as otherwise provided herein, Collateral
Agent shall hold all Collateral and all payments of principal, interest, fees,
charges and expenses received pursuant to this Agreement or any of the Loan
Documents for the benefit of Secured Parties and shall enforce the rights in the
Collateral on behalf of the Secured Parties. Without limiting any of the
foregoing, for the purposes of holding any security granted by any Loan Party
pursuant to the laws of the Province of Quebec, the Collateral Agent shall be
the holder of an irrevocable power of attorney (fonde de pouvoir) (within the
meaning of the Civil Code of Quebec) for all present and future Secured Parties
and in particular for all present and future holders of the bond(s) issued by
any Loan Party in favor of the Collateral Agent (the "BOND"). The Collateral
Agent is hereby appointed by each of the Secured Parties to act as the Person
holding an irrevocable power of attorney (fonde de pouvoir) pursuant to article
2692 of the Civil Code of Quebec in order to hold security granted by a Loan
Party in the Province of Quebec to secure a Bond. By
137
executing an Assignment and Acceptance, each future Secured Party shall be
deemed to ratify the constitution of the Collateral Agent as the holder of the
irrevocable power of attorney (fonde de pouvoir) granted herein. Each party
hereto agrees that, notwithstanding Section 32 of an Act respecting the Special
Powers of Legal Persons (Quebec), Collateral Agent may, as the Person holding
the power of attorney of the Secured Parties, acquire and/or be holder of the
Bond.
(c) Each Secured Party authorizes and directs the Collateral Agent to
enter into the Security Documents and other Loan Documents for the benefit of
Secured Parties. The Collateral Agent is hereby authorized on behalf of all
Secured Parties, without the necessity of any notice to or further consent from
any Secured Party to take any action with respect to any Collateral or the
Security Documents or the other Loan Documents which may be necessary to perfect
and maintain perfected the security interest in and liens upon the Collateral
granted pursuant to the Security Documents and the other Loan Documents. Each
Secured Party agrees that it shall have recourse under or by virtue of the
Security Documents to the Collateral only through the Collateral Agent, that it
shall have no independent recourse to the Liens created by the Security
Documents and that it shall refrain from exercising any rights or remedies under
the Security Documents which have or may have arisen or which may arise as a
result of an Event of Default or an acceleration of the maturities of the
Obligations, except that, any Secured Party (i) may give directions to the
Collateral Agent as one of the Required Lenders, and (ii) may, to the extent
permitted by law or under any Loan Document, set off any amount of any balances
held by it for the account of any Company or any other property held or owing by
it to or for the credit or for the account of any Company provided, however,
that to the extent the amount so set off is to be applied to any of the
Obligations held by such Secured Party, such amount shall be delivered by such
Secured Party to the Collateral Agent for application pursuant to this
Agreement.
(d) Notwithstanding paragraph (c) above, each Lender shall have the
right, with prior notice to Administrative Agent and the Collateral Agent, but
without the approval or consent of Administrative Agent, the Collateral Agent or
the other Lenders, with respect to any Specified Hedging Agreement of such
Lender, (i) to declare an event of default, termination event or other similar
event thereunder and to create an early termination date, (ii) to determine net
termination amounts in accordance with the terms of such Specified Hedging
Agreement and to set-off amounts between Specified Hedging Agreement, and (iii)
in the absence of acceleration of all the Obligations under Article VIII, to
prosecute any legal action against the applicable Company to enforce net amounts
owing to such Lender under the Specified Hedging Agreement.
(e) The Administrative Agent and the Collateral Agent may perform any
of their duties hereunder by or through its agents or employees and each may,
from time to time, agree to reallocate or temporarily assign its rights and
responsibilities hereunder to the other.
138
SECTION 10.02 ADMINISTRATIVE AGENT AND COLLATERAL AGENT IN THEIR
INDIVIDUAL CAPACITY. The Person serving as the Administrative Agent and
Collateral Agent hereunder shall have the same rights and powers in its capacity
as a Lender as any other Lender and may exercise the same as though it were not
the Administrative Agent and Collateral Agent, as applicable, and such Person
and its Affiliates may accept deposits from, lend money to and generally engage
in any kind of business with Borrower or any Subsidiary or other Affiliate
thereof as if it were not the Administrative Agent hereunder or Collateral
Agent, as applicable.
SECTION 10.03 EXCULPATORY PROVISIONS. Neither the Administrative Agent
nor the Collateral Agent shall have any duties or obligations except those
expressly set forth in the Loan Documents. Without limiting the generality of
the foregoing, (a) the Administrative Agent and the Collateral Agent, shall not
be subject to any fiduciary or other implied duties, regardless of whether a
Default has occurred and is continuing (except for the Collateral Agent in its
capacity as trustee for the Secured Parties in respect of the Collateral which
is the subject of Security Documents governed by English law), (b) the
Administrative Agent the Collateral Agent shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated by the Loan Documents that the
Administrative Agent or the Collateral Agent, as applicable, is required to
exercise in writing by the Required Lenders (or such other number or percentage
of the Lenders as shall be necessary under the circumstances as provided in
Section 11.02), and (c) except as expressly set forth in the Loan Documents, the
Administrative Agent and the Collateral Agent shall not have any duty to
disclose, and shall not be liable for the failure to disclose, any information
relating to Borrower or any of its Subsidiaries that is communicated to or
obtained by the bank serving as Administrative Agent or Collateral Agent , as
applicable, or any of its respective Affiliates in any capacity. The
Administrative Agent and Collateral Agent shall not be liable for any action
taken or not taken by it with the consent or at the request of the Required
Lenders (or such other number or percentage of the Lenders as shall be necessary
under the circumstances as expressly provided in this Agreement) or in the
absence of its own gross negligence or willful misconduct. The Administrative
Agent and Collateral Agent shall not be deemed to have knowledge of any Default
unless and until written notice thereof is given to the Administrative Agent and
Collateral Agent by Borrower or a Lender, and the Administrative Agent and
Collateral Agent shall not be responsible for or have any duty to ascertain or
inquire into (i) any statement, warranty or representation made in or in
connection with any Loan Document, (ii) the contents of any certificate, report
or other document delivered thereunder or in connection therewith, (iii) the
performance or observance of any of the covenants, agreements or other terms or
conditions set forth in any Loan Document, (iv) the validity, enforceability,
effectiveness or genuineness of any Loan Document or any other agreement,
instrument or document, or (v) the satisfaction of any condition set forth in
Article IV or elsewhere in any Loan Document, other than to confirm receipt of
items expressly required to be delivered to the Administrative Agent or
Collateral Agent, as applicable.
SECTION 10.04 RELIANCE BY THE ADMINISTRATIVE AGENT AND THE COLLATERAL
AGENT. The Administrative Agent and the Collateral Agent shall be entitled to
rely upon, and shall not incur any liability for relying upon, any notice,
request, certificate, consent, statement, instrument, document or other writing
believed by it to be genuine and to have been signed or sent by the proper
Person. The Administrative Agent and the Collateral Agent also may rely upon any
statement made to it orally or by telephone and believed by it to be made by the
proper
139
Person, and shall not incur any liability for relying thereon. The
Administrative Agent or the Collateral Agent may consult with legal counsel (who
may be counsel for Borrower), independent accountants and other experts selected
by it, and shall not be liable for any action taken or not taken by it in
accordance with the advice of any such counsel, accountants or experts.
SECTION 10.05 DELEGATION OF DUTIES. The Administrative Agent and
Collateral Agent may perform any and all its duties and exercise its rights and
powers by or through any one or more sub-agents appointed by the Administrative
Agent or Collateral Agent, as applicable. The Administrative Agent and
Collateral Agent and any such respective sub-agent may perform any and all its
duties and exercise its rights and powers through their respective Affiliates.
The exculpatory provisions of the preceding paragraphs shall apply to any such
sub-agent and to the Affiliates of each Administrative Agent and Collateral
Agent and any such sub-agent, and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as
well as activities of Administrative Agent and Collateral Agent.
SECTION 10.06 SUCCESSOR ADMINISTRATIVE AGENT AND/OR COLLATERAL AGENT.
The Administrative Agent and/or Collateral Agent may resign as such at any time
upon at least 20 days' prior notice to the Lenders, the Issuing Bank and
Borrower. Upon any such resignation, the Required Lenders shall have the right,
in consultation with Borrower, to appoint a successor from among the Lenders;
provided, however, that if the resigning Administrative Agent is UBS, the
successor Administrative Bank shall be Xxxxxxx and if the resigning Collateral
Agent is Xxxxxxx, the successor Collateral Bank shall be UBS. If no successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 days after the retiring Administrative Agent and/or
Collateral Agent, as applicable, gives notice of its resignation, then the
retiring Administrative Agent and/or Collateral Agent, as applicable may, on
behalf of the Lenders and the Issuing Bank, appoint a successor Administrative
Agent and/or Collateral Agent, as applicable, which successor shall be a
commercial banking institution organized under the laws of the United States (or
any state thereof) or a United States branch or agency of a commercial banking
institution, and having combined capital and surplus of at least $250.0 million;
provided, however, that if such retiring Administrative Agent and/or Collateral
Agent, as applicable is unable to find a commercial banking institution which is
willing to accept such appointment and which meets the qualifications set forth
above, the retiring Administrative Agent's and/or Collateral Agent's resignation
shall nevertheless thereupon become effective, and the Lenders shall assume and
perform all of the duties of the Administrative Agent and/or Collateral Agent,
as applicable hereunder until such time, if any, as the Required Lenders appoint
a successor Administrative Agent and/or Collateral Agent, as applicable.
Upon the acceptance of its appointment as Administrative Agent and/or
Collateral Agent, as applicable, hereunder by a successor, such successor shall
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent and/or Collateral Agent, as applicable, and
the retiring Administrative Agent and/or Collateral Agent, as applicable, shall
be discharged from its duties and obligations hereunder. The fees payable by
Borrower to a successor Administrative Agent and/or Collateral Agent, as
applicable, shall be the same as those payable to its predecessor unless
otherwise agreed between Borrower and such successor. After the Administrative
Agent's and/or Collateral Agent's resignation hereunder, the provisions of this
Article X and Section 11.03 shall continue in effect for the benefit of such
140
retiring Administrative Agent and/or Collateral Agent, as applicable, its
respective sub-agents and their respective Affiliates in respect of any actions
taken or omitted to be taken by any of them while it was acting as
Administrative Agent and/or Collateral Agent, as applicable.
SECTION 10.07 NON-RELIANCE ON THE ADMINISTRATIVE AGENT, THE COLLATERAL
AGENT OR OTHER LENDERS. Each Lender acknowledges that it has, independently and
without reliance upon the Administrative Agent, the Collateral Agent or any
other Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender also acknowledges that it will, independently and without
reliance upon the Administrative Agent, the Collateral Agent or any other Lender
and based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any other Loan Document or related agreement
or any document furnished hereunder or thereunder.
SECTION 10.08 NO OTHER ADMINISTRATIVE AGENT OR COLLATERAL AGENT. The
Lenders identified in this Agreement, the Syndication Agent and the
Documentation Agent shall not have any right, power, obligation, liability,
responsibility or duty under this Agreement other than those applicable to all
Lenders. Without limiting the foregoing, neither the Syndication Agent nor the
Documentation Agent shall have or be deemed to have a fiduciary relationship
with any Lender. Each Lender hereby makes the same acknowledgments with respect
to the Syndication Agent and the Documentation Agent as it makes with respect to
the Administrative Agent or Collateral Agent or any other Lender in this Article
X. Notwithstanding the foregoing, the parties hereto acknowledge that the
Documentation Agent and the Syndication Agent hold such titles in name only, and
that such titles confer no additional rights or obligations relative to those
conferred on any Lender hereunder.
SECTION 10.09 INDEMNIFICATION. The Lenders severally agree to indemnify
each Agent in its capacity as such (to the extent not reimbursed by the Borrower
or the Guarantors and without limiting the obligation of the Borrower or the
Guarantors to do so), ratably according to their respective outstanding Loans
and Commitments in effect on the date on which indemnification is sought under
this Section 10.09 (or, if indemnification is sought after the date upon which
all Commitments shall have terminated and the Loans shall have been paid in
full, ratably in accordance with such outstanding Loans and Commitments as in
effect immediately prior to such date), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever that may at any time
(whether before or after the payment of the Loans) be imposed on, incurred by or
asserted against such Agent in any way relating to or arising out of, the
Commitments, this Agreement, any of 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 such 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 that are found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from such Agent's gross negligence or
willful misconduct. The agreements in this Section 10.09 shall survive the
payment of the Loans and all other amounts payable hereunder.
141
SECTION 10.10 OVERADVANCES. The Administrative Agent shall not make
(and shall prohibit the Issuing Bank and Swingline Lender, as applicable, from
making) any Revolving Loans or provide any Letters of Credit to Borrower on
behalf of Lenders intentionally and with actual knowledge that such Revolving
Loans, Swingline Loans, or Letters of Credit would cause the aggregate amount of
the Revolving Exposure to exceed the Borrowing Base, without the prior consent
of all Lenders, except, that, the Administrative Agent (after consultation with
and consent of the Collateral Agent) may make (or cause to be made) such
additional Revolving Loans or Swingline Loans or provide such additional Letters
of Credit on behalf of Lenders, intentionally and with actual knowledge that
such Loans or Letters of Credit will cause (a) the total outstanding Revolving
Exposure to exceed the Borrowing Base, or (b) Excess Availability to be less
than $15.0 million, in each case as the Administrative Agent and the Collateral
Agent may deem necessary or advisable in their collective discretion (each an
"OVERADVANCE" and collectively the "OVERADVANCES"), provided, that: (i) the
total principal amount of the Overadvances to Borrower which the Administrative
Agent may make or provide (or cause to be made or provided) after obtaining such
actual knowledge that the Revolving Exposure equals or exceeds the Borrowing
Base shall not exceed the amount equal to $20.0 million outstanding at any time
less the then outstanding amount of any Special Agent Advances and shall not
cause the Revolving Exposure to exceed the Revolving Commitments of all of the
Lenders or the Pro Rata Percentage of the Revolving Exposure of a Lender to
exceed such Lender's Revolving Commitment, (ii) without the consent of all
Lenders, (A) no Overadvance shall be outstanding for more than sixty (60) days
and (B) after all Overadvances have been repaid, the Administrative Agent shall
not make any additional Overadvance unless sixty (60) days or more have elapsed
since the last date on which any Overadvance was outstanding and (iii) the
Administrative Agent shall be entitled to recover such funds, on demand from
Borrower together with interest thereon for each day from the date such payment
was due until the date such amount is paid to the Administrative Agent at the
interest rate provided for in Section 2.06(c). Each Lender shall be obligated to
pay the Administrative Agent the amount of its Pro Rata Percentage of any such
Overadvance provided, that the Administrative Agent is acting in accordance with
the terms of this Section 10.10. All Overadvances shall be secured by
Collateral.
SECTION 10.11 SPECIAL AGENT ADVANCES. Administrative Agent (after
consultation with and consent of the Collateral Agent) may, at its option, from
time to time, at any time on or after an Event of Default and for so long as the
same is continuing or upon any other failure of a condition precedent to the
making of Loans hereunder, make such disbursements and advances ("SPECIAL AGENT
ADVANCES") which the Administrative Agent, in its sole discretion after such
consultation with the Collateral Agent, deems necessary or desirable either (i)
to preserve or protect the Collateral or any portion thereof or (ii) to pay any
other amount chargeable to Borrower pursuant to the terms of this Agreement or
any of the other Loan Documents consisting of costs, fees and expenses and
payments to any Issuing Bank (provided, that in no event shall (i) Special Agent
Advances for such purpose exceed the amount equal to $20.0 million in the
aggregate outstanding at any time less the then outstanding Overadvances under
Section 10.10 hereof and (ii) Special Agent Advances plus the Revolving Exposure
exceed the Lenders' Commitment at the time of such Event of Default or cause any
Lender's Revolving Exposure to exceed such Lender's Revolving Loan Commitment at
the time of such Event of Default). Special Agent Advances shall be repayable on
demand and be secured by the Collateral. Special Agent Advances shall not
constitute Loans but shall otherwise constitute
142
Obligations hereunder. Administrative Agent shall notify each Lender and
Borrower in writing of each such Special Agent Advance, which notice shall
include a description of the purpose of such Special Agent Advance. Each Lender
agrees that it shall make available to Administrative Agent, upon Administrative
Agent's demand, in immediately available funds, the amount equal to such
Lender's Pro Rata Percentage of each such Special Agent Advance. If such funds
are not made available to Administrative Agent by such Lender, Administrative
Agent shall be entitled to recover such funds, on demand from such Lender
together with interest thereon for each day from the date such payment was due
until the date such amount is paid to Administrative Agent at the Federal Funds
Rate for each day during such period (as published by the Federal Reserve Bank
of New York or at Administrative Agent's option based on the arithmetic mean
determined by Administrative Agent of the rates for the last transaction in
overnight Federal funds arranged prior to 9:00 a.m. (New York City time) on that
day by each of the three leading brokers of Federal funds transactions in New
York City selected by Administrative Agent) and if such amounts are not paid
within three (3) days of Administrative Agent's demand, at the highest interest
rate provided for in Section 2.06(a).
ARTICLE XI.
MISCELLANEOUS
SECTION 11.01 NOTICES. Notices and other communications provided for
herein shall be in writing and shall be delivered by hand or overnight courier
service, mailed by certified or registered mail or sent by telecopy, as follows:
(a) if to any Loan Party, to Borrower at:
General Cable Corporation
0 Xxxxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, , XX 00000
Attention: Chief Financial Officer
Telecopy No.: (000) 000-0000
with a copy to:
Blank Rome LLP
Xxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxx, Esq.
Xxxxxx X. Xxxxxx, Esq.
Telecopy No.: (000) 000-0000
143
(b) if to the Administrative Agent, to it at:
UBS AG, Stamford Branch
000 Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxx Xxxxxx
Telecopy No.: (000) 000-0000
with a copy to the Collateral Agent as set
forth in Section 11.01(c) below and, except
with respect to communications under Sections 5.01 and 5.15,
to:
Xxxxxx & Xxxxxxx, LLP
000 X. Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxx
Telecopy No.: (000) 000-0000
(c) if to the Collateral Agent, to it at:
Xxxxxxx Xxxxx Capital, a division of Xxxxxxx Xxxxx
Business Financial Services Inc.
000 Xxxxx XxXxxxx Xxxxxx,
00xx Xxxxx,
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxxx
Telecopy No.: (000) 000-0000
with a copy to the Administrative Agent as set forth in
Section 11.01(b) above and, except with respect to
communications under Sections 5.01 and 5.15, to:
Xxxxxx & Xxxxxxx, LLP
000 X. Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxx
Telecopy No.: (000) 000-0000
(d) if to a Lender, to it at its address (or telecopy number) set forth
on the applicable Lender Addendum or in the Assignment and Acceptance pursuant
to which such Lender shall have become a party hereto.
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service or sent by
telecopy or by certified or registered mail, in each case delivered, sent or
mailed (properly addressed) to such party as provided in this Section 11.01 or
in accordance with the latest unrevoked direction from such party given in
144
accordance with this Section 11.01 and failure to deliver courtesy copies of
notices and other communications shall in no event affect the validity or
effectiveness of such notices and other communications.
SECTION 11.02 WAIVERS; AMENDMENT; RELEASES OF COLLATERAL. (a) No
failure or delay by the Administrative Agent, the Collateral Agent, the Issuing
Bank or any Lender in exercising any right or power hereunder or under any other
Loan Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and remedies of
the Administrative Agent, the Collateral Agent, the Issuing Bank and the Lenders
hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provision of any Loan Document or consent to any departure by any Loan Party
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section 11.02, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
Without limiting the generality of the foregoing, the making of a Loan or
issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether the Administrative Agent, the Collateral Agent,
any Lender or the Issuing Bank may have had notice or knowledge of such Default
at the time.
(b) Neither this Agreement nor any other Loan Document nor any
provision hereof or thereof may be waived, amended or modified except, in the
case of this Agreement, pursuant to an agreement or agreements in writing
entered into by Borrower and the Required Lenders or, in the case of any other
Loan Document, pursuant to an agreement or agreements in writing entered into by
the Administrative Agent or Collateral Agent, as applicable, and the Loan Party
or Loan Parties that are parties thereto, in each case with the written consent
of the Required Lenders; provided, that no such agreement shall (i) increase the
Dollar amount of the Commitment of any Lender without the written consent of
such Lender or increase the commitments of all Lenders without the consent of
each Lender, (ii) reduce or forgive the principal amount of any Loan or LC
Disbursement or reduce the rate of interest thereon or amend Annex I or the
definition of "Applicable Margin" (other than to waive default interest under
Section 2.06(c) to the extent a waiver of the underlying default giving rise to
such default interest does not require a vote of all Lenders), or reduce or
forgive any Fees payable hereunder, without the written consent of each Lender
affected thereby, (iii) postpone the maturity of any Loan, or the required date
of reimbursement of any LC Disbursement, or any date for the payment of any
interest or fees payable hereunder, or reduce the amount of, waive or excuse any
such payment, or postpone the scheduled date of expiration of any Commitment or
postpone the scheduled date of expiration of any Letter of Credit beyond the
Maturity Date, or postpone any prepayment or cash collateralization required
under Section 2.10(b), without the written consent of each Lender affected
thereby, (iv) change Section 2.14(b), (c) or Section 9.05 in a manner that would
alter the pro rata sharing of payments or set-offs required thereby, without the
written consent of each Lender, (v) change Section 2.02(a) or (f) or any other
Section of this Agreement in a manner that would alter the pro rata allocation
among the Lenders of Loan or L/C Disbursements without the written consent of
each Lender, (vi) change the percentage set forth in the definition of "Required
Lenders", "Supermajority Lenders" or any other provision of any Loan Document
(including this Section 11.02) specifying the number or percentage of Lenders
(or Lenders of any
145
Class) required to waive, amend or modify any rights thereunder or make any
determination or grant any consent thereunder, without the written consent of
each Lender (or each Lender of such Class, as the case may be), (vii) release
Holdings or any Guarantor from its Guarantee (except as expressly provided in
Article VII), or limit its liability in respect of such Guarantee, without the
written consent of each Lender, (viii) release all or substantially all of the
Collateral from the Liens of the Security Documents (including pursuant to any
Permitted Fixed Asset Exchange or Permitted Asset Sale) or alter the relative
priorities of the Obligations entitled to the Liens of the Security Documents
(except in connection with securing additional Obligations equally and ratably
with the other Obligations), in each case without the written consent of each
Lender, or (ix) change any provisions of any Loan Document in a manner that by
its terms adversely affects the rights in respect of payments due to Lenders
holding Loans of any Class differently than those holding Loans of any other
Class, without the written consent of Lenders holding a majority in interest of
the outstanding Loans and unused Commitments of each affected Class; provided,
further, that (1) no such agreement shall amend, modify or otherwise affect the
rights or duties of the Administrative Agent, the Collateral Agent, the Issuing
Bank or the Swingline Lender without the prior written consent of the
Administrative Agent, the Collateral Agent, the Issuing Bank or the Swingline
Lender, as the case may be, and (2) any waiver, amendment or modification of
this Agreement that by its terms affects the rights or duties under this
Agreement of the Revolving Lenders may be effected by an agreement or agreements
in writing entered into by Borrower and requisite percentage in interest of the
affected Class of Lenders that would be required to consent thereto under this
Section 11.02(b) if such Class of Lenders were the only Class of Lenders
hereunder at the time. Notwithstanding the foregoing, any provision of this
Agreement may be amended by an agreement in writing entered into by Borrower,
the Required Lenders, the Administrative Agent and the Collateral Agent (and, if
their rights or obligations are affected thereby, the Issuing Bank and the
Swingline Lender) if (x) by the terms of such agreement the Commitment of each
Lender not consenting to the amendment provided for therein shall terminate upon
the effectiveness of such amendment and (y) at the time such amendment becomes
effective, each Lender not consenting thereto receives payment in full of the
principal of and interest accrued on each Loan made by it and all other amounts
owing to it or accrued for its account under this Agreement.
(c) If, in connection with any proposed change, waiver, discharge or
termination of the provisions of this Agreement that requires unanimous approval
of all Lenders as contemplated by Section 11.02(b) (other than clause (iii) of
such Section), the consent of the Supermajority Lenders is obtained but the
consent of one or more of such other Lenders whose consent is required is not
obtained, then Borrower shall have the right to replace all, but not less than
all, of such non-consenting Lender or Lenders (so long as all non-consenting
Lenders are so replaced) with one or more Persons pursuant to Section 2.16 so
long as at the time of such replacement each such new Lender consents to the
proposed change, waiver, discharge or termination; provided, however, that
Borrower shall not have the right to replace a Lender solely as a result of the
exercise of such Lender's rights (and the withholding of any required consent by
such Lender) pursuant to paragraph (iii) of Section 11.02(b); provided, further,
that concurrently with the effectiveness of its replacement, each replaced
Lender receives payment in full of the principal of and interest accrued on each
Loan made by it and all other amounts owing to it or accrued for its account
under this Agreement as in effect immediately prior to such replacement.
146
(d) Notwithstanding any other provision contained in this Agreement or
any Loan Document, if a "secured creditor" (as that term is defined under the
BIA) is determined by a court of competent jurisdiction not to include a Person
to whom obligations are owed on a joint or joint and several basis, then the
Canadian Loan Parties' Obligations (and the Obligations of its Subsidiaries), to
the extent such Obligations are secured, only shall be several obligations and
not joint or joint and several obligations.
(e) Without the consent of the Supermajority Lenders, the Collateral
Agent shall not execute any releases of the Liens created by Security Documents
with respect to Collateral having an aggregate Fair Market Value in excess of
$15.0 million in any fiscal year of the Borrower except for releases in
connection with Permitted Fixed Asset Exchanges, Permitted Asset Sales, or the
disposition of any Property by Borrower or any Borrowing Base Guarantor (or by
the Collateral Agent in connection with an enforcement of such Liens), as
otherwise permitted under this Agreement.
SECTION 11.03 EXPENSES; INDEMNITY. (a) Borrower and Holdings agree,
jointly and severally, to pay all reasonable out-of-pocket expenses (including
but not limited to expenses incurred in connection with due diligence and
travel, courier, reproduction, printing and delivery expenses) incurred by the
Administrative Agent, the Collateral Agent, the Swingline Lender and the Issuing
Bank in connection with the syndication of the credit facilities provided for
herein and the preparation, execution and delivery, and administration of this
Agreement and the other Loan Documents, including any Inventory Appraisal, or in
connection with any amendments, modifications, enforcement costs, work-out
costs, documentary taxes or waivers of the provisions hereof or thereof (whether
or not the transactions hereby or thereby contemplated shall be consummated) or
incurred by the Administrative Agent, the Collateral Agent or any Lender in
connection with the work-out enforcement or protection of its rights in
connection with this Agreement (including pursuant to Section 9.02 of this
Agreement) and the other Loan Documents or in connection with the Loans made or
Letters of Credit issued hereunder, including the fees, charges and
disbursements of Xxxxxx & Xxxxxxx, counsel for the Administrative Agent and the
Collateral Agent, and, in connection with any such enforcement or protection, or
work-out, the fees, charges and disbursements of any other counsel for the
Administrative Agent, the Collateral Agent or any Lender.
(b) The Loan Parties agree, jointly and severally, to indemnify the
Administrative Agent, the Collateral Agent, each Lender, the Issuing Bank and
the Swingline Lender, each Affiliate of any of the foregoing Persons and each of
their respective directors, officers, trustees, employees and agents (each such
Person being called an "INDEMNITEE") against, and to hold each Indemnitee
harmless from, all reasonable out-of-pocket costs and any and all losses,
claims, damages, liabilities and related expenses, including reasonable counsel
fees, charges, expenses and disbursements, incurred by or asserted against any
Indemnitee arising out of, in any way connected with, or as a result of (i) the
Transactions, (ii) any actual or proposed use of the proceeds of the Loans or
issuance of Letters of Credit, (iii) any claim, litigation, investigation or
proceeding relating to any of the foregoing, whether or not any Indemnitee is a
party thereto, or (iii) any actual or alleged presence or Release or threatened
Release of Hazardous Materials, on, under or from any Property owned, leased or
operated by any Company, or any Environmental Claim related in any way to any
Company; provided, that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or
related
147
expenses are determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Indemnitee.
(c) The provisions of this Section 11.03 shall remain operative and in
full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans, the expiration of the Commitments, the expiration
of any Letter of Credit, the invalidity or unenforceability of any term or
provision of this Agreement or any other Loan Document, or any investigation
made by or on behalf of the Administrative Agent, the Collateral Agent, the
Issuing Bank or any Lender. All amounts due under this Section 11.03 shall be
payable on written demand therefor accompanied by reasonable documentation with
respect to any reimbursement, indemnification or other amount requested.
(d) To the extent that Borrower fails to pay any amount required to be
paid by it to the Administrative Agent, the Collateral Agent, the Issuing Bank
or the Swingline Lender under paragraph (a) or (b) of this Section 11.03, each
Lender severally agrees to pay to the Administrative Agent, the Collateral
Agent, the Issuing Bank or the Swingline Lender, as the case may be, such
Lender's pro rata share (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount;
provided, that the unreimbursed expense or indemnified loss, claim, damage,
liability or related expense, as the case may be, was incurred by or asserted
against any of the Administrative Agent, the Collateral Agent, the Issuing Bank
or the Swingline Lender in its capacity as such. For purposes hereof, a Lender's
"pro rata share" shall be determined based upon its share of the sum of the
total Revolving Exposure and unused Commitments at the time.
SECTION 11.04 SUCCESSORS AND ASSIGNS. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), except that
Borrower may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by Borrower without such consent shall be null and void).
Nothing in this Agreement, expressed or implied, shall be construed to confer
upon any Person (other than the parties hereto, their respective successors and
assigns permitted hereby (including any Affiliate of the Issuing Bank that
issues any Letter of Credit) and, to the extent expressly contemplated hereby,
the Affiliates of each of the Administrative Agent, the Issuing Bank and the
Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.
(b) Any Lender may assign to one or more banks, insurance companies,
investment companies or funds or other institutions (other than Borrower,
Holdings or any Affiliate or Subsidiary thereof) all or a portion of its rights
and obligations under this Agreement (including all or a portion of its
Commitment and the Loans at the time owing to it); provided, that (i) except in
the case of an assignment to a Lender, an Affiliate of a Lender or a Lender
Affiliate, Borrower (except (i) after the occurrence and during the continuation
of a Default or Event of Default or (ii) prior to the completion of the primary
syndication (as determined by Arrangers) of the Commitments and the Loans by the
Arrangers) and the Administrative Agent (and, in the case of an assignment of
all or a portion of a Revolving Commitment or any Lender's obligations in
respect of its LC Exposure or Swingline Exposure, the Issuing Bank and the
Swingline
148
Lender) must give their prior written consent to such assignment (which consent
shall not be unreasonably withheld or delayed), (ii) except in the case of an
assignment to a Lender, an Affiliate of a Lender or a Lender Affiliate, any
assignment made in connection with the primary syndication of the Commitment and
Loans by the Arrangers or an assignment of the entire remaining amount of the
assigning Lender's Commitments or Loans, the amount of the Commitment or Loans
of the assigning Lender subject to each such assignment (determined as of the
date the Assignment and Acceptance with respect to such assignment is delivered
to the Administrative Agent) shall not be less than in the case of Revolving
Commitments and Revolving Loans, $5.0 million unless each of Borrower and the
Administrative Agent otherwise consent, (iii) each partial assignment shall be
made as an assignment of a proportionate part of all the assigning Lender's
rights and obligations under this Agreement, except that this clause (iii) shall
not be construed to prohibit the assignment of a proportionate part of all the
assigning Lender's rights and obligations in respect of one Class of Commitments
or Loans, (iv) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Acceptance, together with a processing
and recordation fee of $3,500, and (v) the assignee, if it shall not be a
Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire; and provided, further that any consent of Borrower otherwise
required under this paragraph shall not be required if a Default or an Event of
Default has occurred and is continuing. Subject to acceptance and recording
thereof pursuant to paragraph (d) of this Section 11.04(b), from and after the
effective date specified in each Assignment and Acceptance the assignee
thereunder shall be a party hereto and, to the extent of the interest assigned
by such Assignment and Acceptance, have the rights and obligations of a Lender
under this Agreement (provided, that any liability of Borrower to such assignee
under Section 2.12, 2.13 or 2.15 shall be limited to the amount, if any, that
would have been payable thereunder by Borrower in the absence of such
assignment, except to the extent any such amounts are attributable to a Change
in Law occurring after the date of such assignment), and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lender's
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections 2.12,
2.13, 2.15 and 11.03). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this paragraph shall
be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (e) of
this Section 11.04.
(c) The Administrative Agent, acting for this purpose as an agent of
Borrower, shall maintain at one of its offices in The City of New York 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 of,
and principal amount of the Loans and LC Disbursements owing to, each Lender
pursuant to the terms hereof from time to time (the "REGISTER"). The entries in
the Register shall be conclusive in the absence of manifest error, and Borrower,
the Administrative Agent, the Collateral Agent, the Issuing Bank and the Lenders
may treat each Person whose name is recorded in the Register pursuant to the
terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for
inspection by Borrower, the Issuing Bank, the Collateral Agent, the Swingline
Lender and any Lender (with respect to its own interest only), at any reasonable
time and from time to time upon reasonable prior notice.
149
(d) Upon its receipt of a duly completed Assignment and Acceptance
executed by an assigning Lender and an assignee, the assignee's completed
Administrative Questionnaire (unless the assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section 11.04 and any written consent to such assignment required by
paragraph (b) of this Section 11.04, the Administrative Agent shall accept such
Assignment and Acceptance and record the information contained therein in the
Register. No assignment shall be effective for purposes of this Agreement unless
it has been recorded in the Register as provided in this paragraph.
(e) Any Lender may, without the consent of Borrower, the Administrative
Agent, the Issuing Bank or the Swingline Lender, sell participations to one or
more banks or other entities (a "PARTICIPANT") in all or a portion of such
Lender's rights and obligations under this Agreement (including all or a portion
of its Commitment and the Loans owing to it); provided, that (i) such Lender's
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (iii) Borrower, the Administrative Agent, the Collateral
Agent, the Issuing Bank 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. Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce the Loan Documents and to approve any amendment,
modification or waiver of any provision of the Loan Documents; provided, that
such agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to Section 11.02(b) that affects such
Participant. Subject to paragraph (f) of this Section 11.04, Borrower agrees
that each Participant shall be entitled to the benefits of Sections 2.12, 2.13
and 2.15 to the same extent as if it were a Lender and had acquired its interest
by assignment pursuant to paragraph (b) of this Section 11.04. To the extent
permitted by law, each Participant also shall be entitled to the benefits of
Section 11.08 as though it were a Lender; provided, that such Participant agrees
to be subject to Section 2.14(c) as though it were a Lender. Each Lender shall,
acting for this purpose as an agent of the Borrower, maintain at one of its
offices a register for the recordation of the names and addresses of its
Participants, and the amount and terms of its participations, provided, that no
Lender shall be required to disclose or share the information contained in such
register with the Borrower or any other party, except as required by applicable
law.
(f) A Participant shall not be entitled to receive any greater payment
under Section 2.12, 2.13 or 2.15 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the prior
written consent of Borrower (which consent shall not be unreasonably withheld or
delayed). A Participant that would be a Foreign Lender if it were a Lender shall
not be entitled to the benefits of Section 2.15 unless Borrower is notified of
the participation sold to such Participant and such Participant agrees, for the
benefit of Borrower, to comply with Sections 2.15(e) and (f) as though it were a
Lender.
(g) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this Section 11.04 shall not apply to any such pledge
or assignment of a security interest; provided, that no such pledge or
150
assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto. In the case of any Lender that is a fund that invests in bank
loans, such Lender may, without the consent of Borrower or the Administrative
Agent, collaterally assign or pledge all or any portion of its rights under this
Agreement, including the Loans and Notes or any other instrument evidencing its
rights as a Lender under this Agreement, to any holder of, trustee for, or any
other representative of holders of, obligations owed or securities issued, by
such fund, as security for such obligations or securities; provided, that the
documentation governing or evidencing such collateral assignment or pledge shall
provide that any foreclosure or similar action by such trustee or representative
shall be subject to the provisions of this Section 11.04 concerning assignments
and shall not be effective to transfer any rights under this Agreement or in any
Loan, Note or other instrument evidencing its rights as a Lender under this
Agreement unless the requirements of Section 11.04 concerning assignments are
fully satisfied.
SECTION 11.05 SURVIVAL OF AGREEMENT. All covenants, agreements,
representations and warranties made by the Loan Parties in the Loan Documents
and in the certificates or other instruments delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the other parties hereto and shall survive the
execution and delivery of the Loan Documents and the making of any Loans and
issuance of any Letters of Credit, regardless of any investigation made by any
such other party or on its behalf and notwithstanding that the Administrative
Agent, the Collateral Agent, the Issuing Bank or any Lender may have had notice
or knowledge of any Default or incorrect representation or warranty at the time
any credit is extended hereunder, and shall continue in full force and effect as
long as the principal of or any accrued interest on any Loan or any fee or any
other amount payable under this Agreement is outstanding and unpaid or any
Letter of Credit is outstanding and so long as the Commitments have not expired
or terminated. The provisions of Sections 2.12, 2.13, 2.15 and 11.03 and Article
X shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the
Commitments or the termination of this Agreement or any provision hereof.
SECTION 11.06 COUNTERPARTS; INTEGRATION; EFFECTIVENESS. This Agreement
may be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement, the other
Loan Documents and the Fee Letter constitute the entire contract among the
parties relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof. Except as provided in Section 4.01, this Agreement shall become
effective when it shall have been executed by the Administrative Agent and when
the Administrative Agent shall have received counterparts hereof which, when
taken together, bear the signatures of each of the other parties hereto, and
thereafter shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. Delivery of an executed counterpart
of a signature page of this Agreement by telecopy shall be effective as delivery
of a manually executed counterpart of this Agreement.
SECTION 11.07 SEVERABILITY. Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the
151
extent of such invalidity, illegality or unenforceability without affecting the
validity, legality and enforceability of the remaining provisions hereof; and
the invalidity of a particular provision in a particular jurisdiction shall not
invalidate such provision in any other jurisdiction.
SECTION 11.08 RIGHT OF SETOFF. If an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates are hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final, but excluding trust and payroll accounts) at any
time held and other obligations at any time owing by such Lender or Affiliate to
or for the credit or the account of Borrower against any of and all the
obligations of Borrower now or hereafter existing under this Agreement held by
such Lender, irrespective of whether or not such Lender shall have made any
demand under this Agreement and although such obligations may be unmatured. The
rights of each Lender under this Section 11.08 are in addition to other rights
and remedies (including other rights of setoff) which such Lender may have.
SECTION 11.09 GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF
PROCESS. (a) This Agreement shall be construed in accordance with and governed
by the law of the State of New York, without regard to conflicts of law
principles that would require the application of the laws of another
jurisdiction.
(b) Each Loan Party hereby irrevocably and unconditionally submits, for
itself and its Property, to the nonexclusive jurisdiction of the Supreme Court
of the State of New York sitting in New York County and of the United States
District Court of the Southern District of New York, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to any
Loan Document, or for recognition or enforcement of any judgment, and each of
the parties hereto hereby irrevocably and unconditionally agrees that all claims
in respect of any such action or proceeding may be heard and determined in such
New York State or, to the extent permitted by law, in such federal court. Each
of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Agreement or any other Loan Document shall affect any right that the
Administrative Agent, the Collateral Agent, the Issuing Bank or any Lender may
otherwise have to bring any action or proceeding relating to this Agreement or
any other Loan Document against any Loan Party or its properties in the courts
of any jurisdiction.
(c) Each Loan Party hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection which it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any other Loan
Document in any court referred to in paragraph (b) of this Section 11.09. Each
of the parties hereto hereby irrevocably waives, to the fullest extent permitted
by law, the defense of an inconvenient forum to the maintenance of such action
or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 11.01. Nothing in this
Agreement or any other Loan Document will affect the right of any party to this
Agreement to serve process in any other manner permitted by law.
152
SECTION 11.10 WAIVER OF JURY TRIAL. Each party hereto hereby waives, to
the fullest extent permitted by applicable law, any right it may have to a trial
by jury in any legal proceeding directly or indirectly arising out of or
relating to this Agreement, any other Loan Document or the transactions
contemplated hereby (whether based on contract, tort or any other theory). Each
party hereto (a) certifies that no representative, agent or attorney of any
other party has represented, expressly or otherwise, that such other party would
not, in the event of litigation, seek to enforce the foregoing waiver and (b)
acknowledges that it and the other parties hereto have been induced to enter
into this Agreement by, among other things, the mutual waivers and
certifications in this Section 11.10.
SECTION 11.11 Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.
SECTION 11.12 Confidentiality. Each of the Administrative Agent, the
Collateral Agent, the Issuing Bank and the Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its and its Affiliates or its Lender Affiliates'
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential pursuant to the terms hereof),
(b) to the extent requested by any regulatory authority, (c) to the extent
required by applicable laws or regulations or by any subpoena or similar legal
process, (d) to any other party to this Agreement, (e) in connection with the
exercise of any remedies hereunder or any suit, action or proceeding relating to
this Agreement or any other Loan Document or the enforcement of rights hereunder
or thereunder, (f) subject to an agreement containing provisions substantially
the same as those of this Section 11.12, to (i) any assignee of or Participant
in, or any prospective assignee of or Participant in, any of its rights or
obligations under this Agreement or (ii) any actual or prospective counterparty
(or its advisors) to any swap or derivative transaction relating to Borrower and
its obligations, (g) with the consent of Borrower or (h) to the extent such
Information (i) is publicly available at the time of disclosure or becomes
publicly available other than as a result of a breach of this Section 11.12 or
(ii) becomes available to the Administrative Agent, the Collateral Agent, the
Issuing Bank or any Lender on a nonconfidential basis from a source other than
Borrower or any Subsidiary. For the purposes of this Section 11.12,
"Information" means all information received from Borrower or any Subsidiary
relating to Borrower or any Subsidiary or its business, other than any such
information that is available to the Administrative Agent, the Issuing Bank or
any Lender on a nonconfidential basis prior to disclosure by Borrower or any
Subsidiary; provided, that, in the case of information received from Borrower or
any Subsidiary after the date hereof, such information is clearly identified at
the time of delivery as confidential. Any Person required to maintain the
confidentiality of Information as provided in this Section 11.12 shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.
Notwithstanding anything to the contrary set forth herein or in any other
written or oral understanding or agreement to which the parties hereto are
parties or by which they are bound, the parties acknowledge and agree that (i)
any obligations of confidentiality contained herein and therein do not apply and
have not applied from the commencement of discussions between the parties to the
tax treatment and tax structure of the
153
Transactions (and any related transactions or arrangements), and (ii) each party
(and each of its employees, representatives, or other agents) may disclose to
any and all persons, without limitation of any kind, the tax treatment and tax
structure of the Transactions and all materials of any kind (including opinions
or other tax analyses) that are provided to such party relating to such tax
treatment and tax structure, all within the meaning of Treasury Regulation
Section 1.6011-4; provided, however, that each party recognizes that the
privilege each has to maintain, in its sole discretion, the confidentiality of a
communication relating to the Transaction, including a confidential
communication with its attorney or a confidential communication with a federally
authorized tax practitioner under Section 7525 of the Code, is not intended to
be affected by the foregoing.
SECTION 11.13 INTEREST RATE LIMITATION. Notwithstanding anything herein
to the contrary, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as interest
on such Loan under applicable law (collectively, the "CHARGES"), shall exceed
the maximum lawful rate (the "MAXIMUM RATE") which may be contracted for,
charged, taken, received or reserved by the Lender holding such Loan in
accordance with applicable law, the rate of interest payable in respect of such
Loan hereunder, together with all Charges payable in respect thereof, shall be
limited to the Maximum Rate and, to the extent lawful, the interest and Charges
that would have been payable in respect of such Loan but were not payable as a
result of the operation of this Section 11.13 shall be cumulated and the
interest and Charges payable to such Lender in respect of other Loans or periods
shall be increased (but not above the Maximum Rate therefor) until such
cumulated amount, together with interest thereon at the Federal Funds Effective
Rate to the date of repayment, shall have been received by such Lender.
SECTION 11.14 LENDER ADDENDUM. Each Lender to become a party to this
Agreement on the date hereof shall do so by delivering to the Administrative
Agent a Lender Addendum duly executed by such Lender, the Borrower and the
Administrative Agent.
SECTION 11.15 DOLLAR EQUIVALENT CALCULATIONS. For purposes of this
Agreement, all valuations or computations of monetary amounts set forth in this
Agreement or the Loan Documents shall include as the context may require the
Dollar Equivalent of amounts of Canadian Dollars and, in any event, valuation of
assets included in the Borrowing Base which are in Canadian Dollars shall be
converted to Dollar Equivalent of such amounts for the purpose of calculating
the Borrowing Base on each date that a Borrowing Base Certificate is delivered
hereunder and at such other times as designated by the Administrative Agent.
Such Dollar Equivalent shall remain in effect until the same is recalculated by
the Administrative Agent as provided above and notice of such recalculation is
received by the Borrower, it being understood that until such notice of such
recalculation is received, the Dollar Equivalent shall be that Dollar Equivalent
as last reported to the Borrower by the Administrative Agent. The Administrative
Agent shall promptly notify the Borrower and the Lenders of each such
determination of the Dollar Equivalent.
SECTION 11.16 JUDGMENT CURRENCY. (a) The Borrower's obligation
hereunder and under the other Loan Documents to make payments in Dollars
(pursuant to such obligation, the "OBLIGATION CURRENCY") shall not be discharged
or satisfied by any tender or recovery pursuant to any judgment expressed in or
converted into any currency other than the Obligation Currency,
154
except to the extent that such tender or recovery results in the effective
receipt by the Administrative Agent or the respective Lender of the full amount
of the Obligation Currency expressed to be payable to the Administrative Agent
or such Lender under this Agreement or the other Loan Documents. If, for the
purpose of obtaining or enforcing judgment against the Borrower in any court or
in any jurisdiction, it becomes necessary to convert into or from any currency
other than the Obligation Currency (such other currency being hereinafter
referred to as the "JUDGMENT CURRENCY") an amount due in the Obligation
Currency, the conversion shall be made at the Dollar Equivalent, and in the case
of other currencies, the rate of exchange (as quoted by the Administrative Agent
or if the Administrative Agent does not quote a rate of exchange on such
currency, by a known dealer in such currency designated by the Administrative
Agent) determined, in each case, as of the Business Day immediately preceding
the day on which the judgment is given (such Business Day being hereinafter
referred to as the "JUDGMENT CURRENCY CONVERSION DATE").
(b) If there is a change in the rate of exchange prevailing between the
Judgment Currency Conversion Date and the date of actual payment of the amount
due, the Borrower covenants and agrees to pay, or cause to be paid, such
additional amounts, if any (but in any event not a lesser amount) as may be
necessary to ensure that the amount paid in the Judgment Currency, when
converted at the rate of exchange prevailing on the date of payment, will
produce the amount of the Obligation Currency which could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial
award at the rate of exchange prevailing on the Judgment Currency Conversion
Date.
(c) For purposes of determining the Dollar Equivalent or any other rate
of exchange for this Section 11.16, such amounts shall include any premium and
costs payable in connection with the purchase of the Obligation Currency.
[Signature Pages Follow]
155
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
GENERAL CABLE INDUSTRIES, INC., as the
Borrower
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
GENERAL CABLE COMPANY, as a Loan
Party, Guarantor and Borrowing Base Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
GENERAL CABLE CORPORATION, as a Loan
Party, Borrowing Base Guarantor and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
GK TECHNOLOGIES, INCORPORATED, as a Loan
Party, Borrowing Base Guarantor and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
GENERAL CABLE INDUSTRIES, LLC, as a Loan
Party, Borrowing Base Guarantor and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
S-1
[Signature Page to Credit Agreement]
GENERAL CABLE TECHNOLOGIES
CORPORATION, as a Loan Party, Borrowing
Base Guarantor and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
GENERAL CABLE TEXAS OPERATIONS,
L.P., as a Loan Party, Borrowing Base
Guarantor and Guarantor
By: GENERAL CABLE INDUSTRIES, INC., its
general partner
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
GENERAL CABLE RESOURCES
CORPORATION, as a Loan Party and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
MARATHON MANUFACTURING
HOLDINGS, INC., as a Loan Party and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
GENERAL CABLE HOLDINGS, INC, as a Loan
Party and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
S-2
[Signature Page to Credit Agreement]
GENERAL CABLE OVERSEAS HOLDINGS,
INC., as a Loan Party and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
GENERAL CABLE MANAGEMENT LLC, as a
Loan Party and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
DIVERSIFIED CONTRACTORS, INC., as a
Loan Party and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
MLTC COMPANY, as a Loan Party and
Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
MARATHON STEEL COMPANY, as a Loan
Party and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
S-3
[Signature Page to Credit Agreement]
GENCA CORPORATION, as a Loan Party and
Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
GENERAL CABLE CANADA LTD., as a Loan
Party and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
GENERAL CABLE DE MEXICO DEL NORTE
SA DE CV, as a Loan Party and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
GENERAL CABLE DE LATINOAMERICA,
SA DE CV, as a Loan Party and Guarantor
By: /s/ XXXXXXXXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Executive Vice President
S-4
[Signature Page to Credit Agreement]
XXXXXXX XXXXX CAPITAL, A DIVISION OF
XXXXXXX XXXXX BUSINESS FINANCIAL SERVICES
INC., as a Lender, Collateral Agent and
Syndication Agent
By: /s/ XXXXXX XXXXX
---------------------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
UBS AG, STAMFORD BRANCH,
as Issuing Bank and Administrative Agent
By: /s/ XXXXXXX X. SAINT
---------------------------------------
Name: Xxxxxxx X. Saint
Title: Associate Director Banking Products
Services, US
By: /s/ XXXXXX X. XXXXXXX
---------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Director Banking Products
Services, US
UBS LOAN FINANCE LLC, as a Lender
and Swingline Lender
By: /s/ XXXXXXX X. SAINT
---------------------------------------
Name: Xxxxxxx X. Saint
Title: Associate Director Banking Products
Services, US
By: /s/ XXXXXX X. XXXXXXX
---------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Director Banking Products
Services, US
S-5
[Signature Page to Credit Agreement]
FLEET CAPITAL CORPORATION,
as a Lender and a Co-Documentation Agent
By: /s/ XXXXX XXXXX
---------------------------------------
Name: Xxxxx Xxxxx
Title: Senior Vice President
S-6
[Signature Page to Credit Agreement]
GENERAL ELECTRIC CAPITAL CORPORATION,
as a Lender and a Co-Documentation Agent
By: /s/ GENERAL ELECTRIC CAPITAL CORP
---------------------------------------
Name:
Title:
S-7
[Signature Page to Credit Agreement]
BANK ONE, NA, as a Lender
By: /s/ XXXXX X. XXXXX
---------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
S-8
[Signature Page to Credit Agreement]
THE CIT GROUP/BUSINESS CREDIT, INC.,
as a Lender
By: /s/ XXXXX X. XXXXXXX, XX.
---------------------------------------
Name: Xxxxx X. Xxxxxxx, Xx.
Title: Vice President
S-9
[Signature Page to Credit Agreement]
XXXXX FARGO FOOTHILL, LLC,
as a Lender
By: /s/ XXXXX XXXXXX
---------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
S-10
[Signature Page to Credit Agreement]
GMAC COMMERCIAL FINANCE LLC, as a
Lender and a Co-Documentation Agent
By: /s/ X. XXXXXXXXX XXXXX
---------------------------------------
Name: X. Xxxxxxxxx Xxxxx
Title: Director
S-11
[Signature Page to Credit Agreement]
LASALLE BANK NATIONAL ASSOCIATION,
as a Lender
By: /s/ XXXXXXXX X. XXXXXX
---------------------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: Vice President
S-12
[Signature Page to Credit Agreement]
NATIONAL CITY COMMERCIAL FINANCE,
INC., as a Lender
By: /s/ XXXXXXX X. XXXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
S-13
[Signature Page to Credit Agreement]
PB CAPITAL CORPORATION, as a Lender
By: /s/ XXXXX X. XXXXXXXX
---------------------------------------
Name: Xxxxx X. XxXxxxxx
Title: Vice President
S-14
[Signature Page to Credit Agreement]
PNC BANK, N.A., as a Lender
By: /s/ XXXX X. XXXXXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Senior Vice President
S-15
[Signature Page to Credit Agreement]
ALLIED IRISH BANKS, P.L.C., as a Lender
By: /s/ XXXXXX X. XXXX
---------------------------------------
Name: Xxxxxx X. Xxxx
Title: Vice President
S-16
[Signature Page to Credit Agreement]
UPS CAPITAL CORPORATION, as a Lender
By: /s/ XXXXXXXX XXXXXXX
---------------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Senior Vice President
S-17
[Signature Page to Credit Agreement]
WHITEHALL BUSINESS CREDIT
CORPORATION, as a Lender
By: /s/ XXXXXX ZAUTHRA
---------------------------------------
Name: Xxxxxx Zauthra
Title: Vice President
S-18
[Signature Page to Credit Agreement]
ING CAPITAL LLC, as a Lender
By: /s/ ING CAPITAL LLC
---------------------------------------
Name:
Title:
S-19
[Signature Page to Credit Agreement]
THE PROVIDENT BANK, as a Lender
By: /s/ THE PROVIDENT BANK
---------------------------------------
Name:
Title:
S-20
[Signature Page to Credit Agreement]
RZB FINANCE LLC, as a Lender
By: /s/ XXXX X. XXXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxxx
Title: Group Vice President
S-21
[Signature Page to Credit Agreement]
ANNEX I
APPLICABLE MARGIN
From the Closing Date until the last day of the fiscal quarter of the
Borrower ending on June 30, 2004:
REVOLVING LOANS
EURODOLLAR ABR
----------------------------------------------------------
2.75% 1.50%
and thereafter:
REVOLVING LOANS
FIXED CHARGE ---------------
COVERAGE RATIO EURODOLLAR ABR
-------------- ---------- ---
LEVEL I: < or = 1.15:1.00 3.00% 1.75%
LEVEL II: > 1.15:1.00, but 2.75% 1.50%
< or = 1.50:1.00
LEVEL III: > 1.50:1.00 2.50% 1.25%
Each change in the Applicable Margin resulting from a change in the
Fixed Charge Coverage Ratio shall be effective with respect to all Loans and
Letters of Credit outstanding on and after the date of delivery to the
Administrative Agent of the financial statements and certificates required by
Section 5.01(a) or (b) and Section 5.01(d), respectively, indicating such change
until the date immediately preceding the next date of delivery of such financial
statements and certificates indicating another such change. Notwithstanding the
foregoing, the Fixed Charge Coverage Ratio shall be deemed to be in Level I for
purposes of determining the Applicable Margin (i) from the end of the fiscal
quarter of the Borrower ending on June 30, 2004 to the date of delivery to the
Administrative Agent of the financial statements and certificates required by
Section 5.01(a) or (b) and Section 5.01(d) for the fiscal period ended at least
six months after the Closing Date, (ii) at any time during which Borrower has
failed to deliver the financial statements and certificates required by Section
5.01(a) or (b) and Section 5.01(d), respectively, and (iii) at any time during
the existence of an Event of Default.
