Exhibit 4.2
SECOND AMENDED AND RESTATED LOAN
AND AGENCY AGREEMENT
among
INTERMAGNETICS GENERAL CORPORATION
APD CRYOGENICS INC.
MAGSTREAM CORPORATION
MEDICAL ADVANCES, INC.
INTERCOOL ENERGY CORPORATION
and
CORESTATES BANK, N.A. AND THE OTHER BANKS PARTY HERETO
with
CORESTATES BANK, N.A.
as Agent
October 23, 1997
TABLE OF CONTENTS
Page
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I. CERTAIN DEFINITIONS..................................................................................1
1.1 Definitions...................................................................................1
1.2 Accounting Terms..............................................................................8
II. THE CREDIT 9
2.1 Revolving Credit Loans........................................................................9
2.2 The Revolving Credit Notes....................................................................10
2.3 Funding Procedures............................................................................10
2.4 Interest......................................................................................12
2.5 Fees..........................................................................................14
2.6 Reduction or Termination of Aggregate Revolving Loan Commitment...............................14
2.7 Voluntary Prepayments.........................................................................14
2.8 Payments......................................................................................15
2.9 Changes in Circumstances; Yield Protection....................................................16
2.10 Illegality....................................................................................18
2.11 Joint and Several Liability...................................................................18
2.12 Optional Cash Management Facility.............................................................18
III. REPRESENTATIONS AND WARRANTIES 19
3.1 Good Standing of the Borrowers; Authorization.................................................19
3.2 Compliance with Laws and Other Agreements.....................................................19
3.3 No Conflict; Governmental Approvals...........................................................19
3.4 Financial and Other Information Regarding Borrowers...........................................19
3.5 Taxes.........................................................................................20
3.6 Liens and Guaranties..........................................................................20
3.7 Material Adverse Changes......................................................................20
3.8 Compliance with Federal Reserve Board Regulations.............................................20
3.9 ERISA.........................................................................................21
3.10 Pending Litigation............................................................................21
3.11 Valid, Binding and Enforceable................................................................21
3.12 No Untrue Statements..........................................................................21
IV. CONDITIONS PRECEDENT 21
4.1 Conditions Precedent to All Loans.............................................................21
4.2 Conditions Precedent to First Loan............................................................22
V. AFFIRMATIVE COVENANTS 23
5.1 Use of Proceeds...............................................................................23
5.2 Accounting Records, Reports and Financial Statements..........................................23
5.3 Ordinary Course of Business; Records..........................................................24
5.4 Information for the Banks.....................................................................24
5.5 Insurance.....................................................................................24
5.6 Maintenance...................................................................................25
5.7 Taxes.........................................................................................25
5.8 Leases........................................................................................25
5.9 Corporate Existence; Certain Rights; Laws.....................................................25
5.10 Notice of Litigation..........................................................................25
5.11 Indebtedness..................................................................................25
5.12 Notice of Events of Default...................................................................26
5.13 ERISA.........................................................................................26
5.14 Deposit Accounts..............................................................................26
5.15 Management....................................................................................26
5.16 Financial Covenants...........................................................................26
VI. NEGATIVE COVENANTS 26
6.1 Fundamental Corporate Changes.................................................................27
6.2 Indebtedness..................................................................................27
6.3 Liens.........................................................................................27
6.4 Guaranties....................................................................................28
6.5 Sales and Lease-Backs.........................................................................28
6.6 Loans; Investments............................................................................28
6.7 Change in Business............................................................................28
6.8 Sale or Discount of Receivables...............................................................28
6.9 ERISA.........................................................................................28
6.10 Restricted Payments...........................................................................29
VII. DEFAULT 29
7.1 Borrowers' Failure to Pay.....................................................................29
7.2 Breach of Covenants or Conditions.............................................................29
7.3 Defaults in Other Agreements..................................................................29
7.4 Agreements Invalid............................................................................29
7.5 False Warranties; Breach of Representations...................................................30
7.6 Judgments.....................................................................................30
7.7 Bankruptcy or Insolvency of a Borrower........................................................30
VIII. REMEDIES 31
8.1 Further Advances; Acceleration; Setoff........................................................31
8.2 Further Remedies..............................................................................32
IX. AGENT 32
9.1 Appointment and Authorization.................................................................32
9.2 Duties and Obligations........................................................................32
9.3 The Agent as a Bank...........................................................................33
9.4 Independent Credit Decisions..................................................................33
9.5 Indemnification...............................................................................33
9.6 Successor Agent...............................................................................34
9.7 Allocations Made By Agent.....................................................................34
9.8 Benefits of Article IX........................................................................34
9.9 Mutual Disclosure.............................................................................35
9.10 Reports and Notices..........................................................................35
X. MISCELLANEOUS 35
10.1 Waiver........................................................................................35
10.2 Amendments....................................................................................35
10.3 Governing Law.................................................................................35
10.4 Participations and Assignments................................................................36
10.5 Captions......................................................................................37
10.6 Notices.......................................................................................37
10.7 Sharing of Collections, Proceeds and Set-Offs; Application of Payments........................38
10.8 Expenses of the Agent; Indemnification of the Agent and the Banks.............................39
10.9 Survival of Warranties and Certain Agreements.................................................40
10.10 Severability..................................................................................40
10.11 Banks' Obligations Several; Independent Nature of Banks' Rights...............................40
10.12 No Fiduciary Relationship.....................................................................40
10.13 CONSENT TO JURISDICTION AND SERVICE OF PROCESS................................................41
10.14 WAIVER OF JURY TRIAL..........................................................................41
10.15 Counterparts; Effectiveness...................................................................41
10.16 Use of Defined Terms..........................................................................42
LIST OF EXHIBITS:
Exhibit A Form of Borrowing Notice
Exhibit B Form of Covenant Compliance Certificate
Exhibit C Form of Competitive Bid Note
LIST OF SCHEDULES:
Schedule A Applicable Margin for LIBO Rate Loans
Schedule 3.4(c) Borrowers' Investments
Schedule 5.16 Financial Covenants
Schedule 6.2 Existing Indebtedness
SECOND AMENDED AND RESTATED LOAN AND AGENCY AGREEMENT
THIS SECOND AMENDED AND RESTATED LOAN AND AGENCY AGREEMENT, dated as of
October 23, 1997 (this "Agreement"), is entered into by and among INTERMAGNETICS
GENERAL CORPORATION, a New York corporation ("IGC"), APD CRYOGENICS INC., a
Pennsylvania corporation ("APD"), MAGSTREAM CORPORATION, a New York corporation
("MC"), MEDICAL ADVANCES, INC., a Wisconsin corporation ("MA"), and INTERCOOL
ENERGY CORPORATION, a Delaware corporation ("IEC") (each, a "Borrower" and
collectively, the "Borrowers"), the banking institutions signatories hereto and
such other institutions that hereafter become a "Bank" pursuant to Section 10.4
hereof (each, a "Bank" and collectively, the "Banks") and CORESTATES BANK, N.A.,
a national banking association ("CoreStates"), as agent for the Banks under this
Agreement (in such capacity, the "Agent").
WITNESSETH:
WHEREAS, the Agent and IGC, APD and MC (collectively, the "Existing
Borrowers") are parties to a certain Amended and Restated Loan Agreement dated
as of December 23, 1991, as amended on February 26, 1992, June 14, 1994, and
August 1, 1994 (as amended, the "Existing Loan Agreement"), pursuant to which
the Agent has made available to the Existing Borrowers certain credit
facilities.
WHEREAS, the parties hereto desire to amend and restate the Existing
Loan Agreement in its entirety to, among other things: add MA and IEC (the "New
Borrowers") as additional co-borrowers; add the Banks other than the Agent as
additional co-lenders; and set forth the terms on which the Agent shall act as
agent for the Banks; and
WHEREAS, the Banks and the Borrowers desire the Agent, and the Agent
has agreed, to act as the agent for the Banks as provided herein.
NOW, THEREFORE, in consideration of the premises and intending to be
legally bound hereby, the parties hereto agree to amend and restate the Existing
Loan Agreement in its entirety as follows:
I. CERTAIN DEFINITIONS
1.1 Definitions. As used in this Agreement, the following terms shall
have these meanings:
"Additional Amount" shall have the meaning set forth in Section 2.1.
"Adjusted Base Rate" shall mean the Base Rate less one-half of one
percent (0.5%).
"Affiliate" shall mean any Person: (1) which directly or indirectly
controls, or is controlled by, or is under common control with any Borrower or
any Subsidiary; (2) which directly or indirectly beneficially owns or holds ten
percent (10%) or more of any class of voting stock of any Borrower or any
Subsidiary; or (3) ten percent (10%) or more of the voting stock of which is,
directly or indirectly, beneficially owned or held by any Borrower or any
Subsidiary. The term "control" means the possession, directly or indirectly, of
the power to direct or cause the direction of the management and policies of a
Person, whether through the ownership of voting securities, by contract, or
otherwise.
"Agreement" shall mean this Second Amended and Restated Loan and Agency
Agreement, as amended, supplemented, or modified from time to time, and all
exhibits and schedules attached hereto.
"Aggregate Revolving Loan Commitment" shall have the meaning set forth
in Section 2.1.
"Applicable Margin" shall mean the margin applicable to LIBO Rate
Loans, determined in accordance with Schedule A hereto.
"Base Rate" shall mean, for any day, the prime commercial lending rate
of CoreStates, as announced from time to time at its head office, calculated on
the basis of the actual number of days elapsed in a year of 360 days.
"Base Rate Loans" shall mean Revolving Credit Loans accruing interest
based on the Adjusted Base Rate.
"Business Day" shall mean any day other than a Saturday, Sunday, or
other day on which commercial banks in Philadelphia are authorized or required
to close under the laws of the Commonwealth of Pennsylvania and, if the
applicable day relates to a LIBO Rate Loan, or notice with respect to a LIBO
Rate Loan, a day on which dealings in Dollar deposits are also carried on in the
London interbank market and banks are open for business in London ("London
Business Day").
"Capitalized Lease" shall mean all lease obligations of any Person for
any property (whether real, personal or mixed) which have been or should be
capitalized on the books of the lessee in accordance with Generally Accepted
Accounting Principles.
"Closing Date" shall mean the date hereof.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and all rules and regulations with respect thereto in effect from
time to time.
"Commitment Percentage" shall mean with respect to each Bank, the
percentage set forth opposite its name on the signature page hereof.
"Competitive Bid Loan" shall mean a Loan made by a Bank to the
Borrowers pursuant to Section 2.4(c) hereof.
"Competitive Bid Notes" shall mean notes issued by the Borrowers to
evidence Loans made pursuant to Section 2.4(c) hereof.
"Covenant Compliance Certificate" shall mean a certificate, completed
by the Chief Financial Officer of IGC on behalf of the Borrowers and submitted
to the Agent, in the form of Exhibit B hereto.
"Current Assets" shall mean, at any time, all assets which, in
accordance with GAAP, should be classified as current assets of any Borrower.
"Default Rate" on any Loan shall mean the lower of (i) 2% per annum
above the Base Rate; or (ii) the highest interest rate permitted by applicable
law.
"Dollars" shall mean the lawful currency of the United States of
America.
"EBITDA" shall mean, for any period, the sum (without duplication) of
(i) Net Income, (ii) provision for taxes based on income, (iii) Interest
Expenses, and (iv) to the extent Net Income has been reduced thereby,
amortization expense, depreciation expense and other expenses not ultimately
settled in cash, all as determined for the Borrowers on a consolidated basis in
accordance with GAAP.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as it may be amended from time to time.
"ERISA Affiliate" shall mean any corporation which is a member of the
same controlled group of corporations as any Borrower within the meaning of
Section 414(b) of the Code, or any trade or business which is under common
control with any Borrower within the meaning of Section 414(c) of the Code.
"Event of Default" shall have the meaning set forth in Section 7.1.
"Environmental Laws" shall mean the Federal Comprehensive Environmental
Response, Compensation and Liability Act, 42 U.S.C. xx.xx. 9601, et seq., the
Federal Resource Conservation and Recovery Act, 42 U.S.C. xx.xx. 6901, et seq.,
the Hazardous Materials Transportation Act, 49 U.S.C. xx.xx. 1801, et seq., all
other federal, state and local environmental or health laws applicable to any
Borrower or its business, operations or assets now or hereafter enacted, and all
rules, regulations, orders and publications adopted or promulgated pursuant
thereto from time to time.
"Federal Funds Rate" shall mean, for any day, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day, provided that if the day for which
such rate is to be determined is not a Business Day, the Federal Funds Rate for
such day shall be such rate on such transactions on the next preceding Business
Day as so published on the next succeeding Business Day.
"Guaranty" shall mean any guaranty or other agreement to be a surety or
other contingent liability (other than any endorsement for collection or deposit
in the ordinary course of business), direct or indirect, with respect to any
obligation of another Person.
"Generally Accepted Accounting Principles" or "GAAP" shall mean
generally accepted accounting principles as in effect from time to time in the
United States, consistently applied.
"Governmental Authority" shall mean the federal, state, county or
municipal government, or any department, agency, bureau or other similar type
body obtaining authority therefrom or created pursuant to any laws, including,
without limitation, Environmental Laws.
"Indebtedness" shall mean any obligation for borrowed money, including,
without limitation: (i) any obligation owed for all or any part of the purchase
price of property or other assets or for the cost of property or other assets
constructed or improvements thereto, other than accounts payable included in
current liabilities and incurred in respect of property purchased in the
ordinary course of business; and (ii) any Capitalized Lease obligation.
"Interest Expenses" shall mean, for any period, the gross interest
expense for the Borrowers on a consolidated basis for such period, as determined
in accordance with GAAP.
"Interest Period" shall mean, with respect to any LIBO Rate Loan, each
period commencing on the date any such Loan is made or, with respect to a Loan
being renewed, the last day of the next preceding Interest Period with respect
to a Loan, and ending on the numerically corresponding day (or, if there is no
numerically corresponding day, on the last day of the calendar month) in the
first, second, third or sixth calendar month thereafter as selected under the
procedures specified in Section 2.3, if the Banks are then offering LIBO Rate
Loans for such period; provided that each LIBO Rate Loan Interest Period which
would otherwise end on a day which is not a Business Day (or, for purposes of
Loans to be repaid on a London Business Day, such day is not a London Business
Day) shall end on the next succeeding Business Day (or London Business Day, as
appropriate) unless such next succeeding Business Day (or London Business Day,
as appropriate) falls in the next succeeding calendar month, in which case the
Interest Period shall end on the next preceding Business Day (or London Business
Day, as appropriate).
"LIBO Rate" shall mean, for the applicable Interest Period, (i) the
rate, rounded upwards to the next one-sixteenth of one percent, determined by
the Agent two London Business Days prior to the date of the corresponding LIBO
Rate Loan, at which the Agent is offered deposits in dollars at approximately
11:00 A.M. London time by leading banks in the interbank eurodollar or
eurocurrency market for delivery on the date of such Loan in an amount and for a
period
comparable to the amount and Interest Period of such Loan and in like
funds, divided by (ii) a number equal to one (1.0) minus the LIBO Rate Reserve
Percentage. The LIBO Rate shall be adjusted automatically with respect to any
LIBO Rate Loan outstanding on the effective date of any change in the LIBO Rate
Reserve Percentage, as of such effective date. LIBO Rate shall be calculated on
the basis of the number of days elapsed in a year of 360 days.
"LIBO Rate Reserve Percentage" shall mean, for any LIBO Rate Loan for
any Interest Period therefor, the daily average of the stated maximum rate
(expressed as a decimal) at which reserves (including any marginal,
supplemental, or emergency reserves) are required to be maintained during such
Interest Period under Regulation D by the Agent against "Eurocurrency
liabilities" (as such term is used in Regulation D) but without benefit of
credit proration, exemptions, or offsets that might otherwise be available to
the Agent from time to time under Regulation D. Without limiting the effect of
the foregoing, the LIBO Rate Reserve Percentage shall reflect any other reserves
required to be maintained by the Agent against (1) any category of liabilities
which includes deposits by reference to which the rate for LIBO Rate Loans is to
be determined; or (2) any category of extension of credit or other assets which
include LIBO Rate Loans.
"LIBO Rate Loans" shall mean Revolving Credit Loans accruing interest
based on the LIBO Rate.
"Lien" shall mean any lien, mortgage, security interest, chattel
mortgage, pledge or other encumbrance (statutory or otherwise) of any kind
securing satisfaction of an obligation, including any agreement to give any of
the foregoing, any conditional sales or other title retention agreement, any
lease in the nature thereof, and the filing of or the agreement to give any
financing statement under the Uniform Commercial Code of any jurisdiction or
similar evidence of any encumbrance, whether within or outside the United
States.
"Loan" or "Loans" shall mean a Revolving Credit Loan or Revolving
Credit Loans and a Competitive Bid Loan or Competitive Bid Loans.
"Loan Documents" shall mean this Agreement, the Notes, and each other
agreement, document and instrument executed in connection herewith.
"Multiemployer Plan" shall mean a multiemployer plan as defined in
ERISA Section 4001(a)(3), which covers employees of any Borrower or any ERISA
Affiliate.
"Net Income" shall mean, for any period, the consolidated net income
(after the deduction of federal and state income taxes) of the Borrowers,
determined in accordance with GAAP, excluding:
(a) the proceeds of any insurance policy;
(b) any gain or loss arising from:
(1) the sale or other disposition of any assets,
other than in the ordinary course of
business (other than Current Assets);
(2) any write-up of assets; or
(3) the acquisition of outstanding securities
representing Indebtedness of any
Borrower;
(c) any earnings, prior to the date of acquisition,
of any Person acquired in any manner;
(d) any earnings of a successor to or transferee of the
assets of any Borrower prior to
becoming such successor or transferee;
(e) any deferred credit (or amortization of a deferred
credit) arising from the acquisition of any Person;
and
(f) any other item constituting an extraordinary gain or
loss under GAAP.
"Notes" shall mean the Revolving Credit Notes and Competitive Bid
Notes.
"Obligations" shall mean all now existing or hereafter arising debts,
obligations, covenants, and duties of payment or performance of every kind,
matured or unmatured, direct or contingent, owing, arising, due, or payable to
the Banks or the Agent by or from the Borrowers or any Subsidiary arising out of
this Agreement or any other Loan Document, including, without limitation, all
obligations to repay principal of and interest on all the Revolving Credit
Loans, and to pay interest, fees, costs, charges, expenses, professional fees,
and all sums chargeable to the Borrowers or any Subsidiary or for which any
Borrower or any Subsidiary is liable as indemnitor under the Loan Documents,
whether or not evidenced by any note or other instrument.
"Operating Lease" shall mean an operating lease as defined by Generally
Accepted Accounting Principles, excluding all leases the expenses for which may
be charged to a customer of any Borrower pursuant to the written terms of the
contract with such customer.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any
successor thereto.
"Pension Plan" shall mean, at any time, any Plan (including a
Multiemployer Plan), the funding requirements of which (under ERISA Section 302
or Code Section 412) are, or at any time within the six years immediately
preceding the time in question were, in whole or in part, the responsibility of
any Borrower or any ERISA Affiliate.
"Permitted Acquisitions" shall mean acquisitions by the Borrowers, or
any of them, of the assets and/or capital stock of other businesses and/or
Persons, for which cash consideration (net of any cash acquired directly by the
Borrowers or retained by the entity that is acquired by the Borrowers as part of
the acquisition transaction) is paid in an amount not to exceed $10,000,000 in
the aggregate between the Closing Date and the Revolver Termination Date.
"Person" shall mean any individual, corporation, partnership, joint
venture, association, company, business trust or entity, or other entity of
whatever nature.
"Plan" shall mean an employee benefit plan as defined in Section 3(3)
of ERISA, other than a Multiemployer Plan, whether formal or informal and
whether legally binding or not.
"Potential Default" shall mean an event, condition or circumstance that
with the giving of notice or lapse of time or both would become an Event of
Default.
"Regulation" shall mean any statute, law, ordinance, regulation, order
or rule of any United States or foreign, federal, state, local or other
government or governmental body, including, without limitation, those covering
or related to banking, financial transactions, securities, public utilities,
environmental control, energy, safety, health, transportation, bribery, record
keeping, zoning, anti-discrimination, antitrust, wages and hours, employee
benefits, and price and wage control matters.
"Regulation D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System, as it may be amended from time to time.
"Regulatory Change" shall mean any change after the date of this
Agreement in any Regulation (including Regulation D) or the adoption or making
after such date of any interpretations, directives or requests of or under any
Regulation (whether or not having the force of law) by any court or governmental
or monetary authority charged with the interpretation or administration thereof
applying to a class of banks including any one of the Banks but excluding any
foreign office of any Bank.
"Reportable Event" shall mean, with respect to a Pension Plan: (a) Any
of the events set forth in ERISA Sections 4043(b) (other than a reportable event
as to which the provision of 30 days' notice to the PBGC is waived under
applicable regulations) or 4063(a) or the regulations thereunder, (b) an event
requiring any Borrower or any ERISA Affiliate to provide security to a Pension
Plan under Code Section 401(a)(29) and (c) any failure by any Borrower or any
ERISA Affiliate to make payments required by Code Section 412(m).
"Required Banks" at any time shall mean Banks whose Revolving Loan
Commitments equal or exceed 51% of the total of such Revolving Loan Commitments
if no Loans are outstanding or, if Loans are outstanding, Banks whose
outstanding Loans equal or exceed 51% of the Loans; provided, however, that with
respect to Sections 5.1, 5.11, 5.14, 5.16, 6.1, 6.2, 6.3, 6.4, 6.6, 6.7, 6.8,
6.10 and 8.1 of this Agreement, the term "Required Banks" shall mean Banks whose
Revolving Loan Commitments equal 100% of the total of such Revolving Loan
Commitments if no Loans are outstanding or, if Loans are outstanding, Banks
whose outstanding Loans equal 100% of the Loans.
"Revolver Termination Date" shall have the meaning set forth in Section
2.1.
"Revolving Loan Commitment" shall have the meaning set forth in Section
2.1.
"Revolving Credit Loan" or "Loan" shall have the meaning set forth in
Section 2.1.
"Revolving Credit Note" shall have the meaning set forth in Section
2.2.
"Senior Funded Debt" shall mean (i) Indebtedness, excluding
Subordinated Indebtedness; (ii) Capitalized Lease obligations; (iii) all
Guaranties, direct or indirect, except (A) those that guarantee obligations that
would already be included in this definition and (B) guarantees of obligations
arising under Operating Leases; (iv) contingent obligations in connection with
issued and outstanding standby letters of credit, except those obligations that
would already be included in this definition; and (v) obligations in connection
with bankers' acceptances.
"Subordinated Indebtedness" shall mean, at any time, all Indebtedness
of the Borrowers subordinated to the Obligations on terms reasonably
satisfactory to the Banks, including the outstanding portion of the $30,000,000
of 5.75% convertible subordinated debentures due September 19, 2003.
"Subsidiary" shall mean a corporation or other entity, the shares of
stock or other equity interests of which having ordinary voting power (other
than stock or other equity interests having such power only by reason of the
happening of a contingency) to elect a majority of the board of directors or
other managers of such corporation are at the time owned, or the management of
which is otherwise controlled, directly or indirectly through one or more
intermediaries or both, by any Borrower.
"Taxes" shall have the meaning set forth in Section 2.9.
"Termination Event" shall mean, with respect to a Pension Plan: (a) a
Reportable Event, (b) the termination of a Pension Plan, or the filing of a
notice of intent to terminate a Pension Plan, or the treatment of a Pension Plan
amendment as a termination under ERISA Section 4041(c), (c) the institution of
proceedings to terminate a Pension Plan under ERISA Section 4042 or (d) the
appointment of a trustee to administer any Pension Plan under ERISA Section
4042.
1.2 Accounting Terms. All accounting terms not specifically defined
herein shall be construed in accordance with Generally Accepted Accounting
Principles consistent with those applied in the preparation of the Financial
Statements referred to in Section 3.4, and all financial data submitted pursuant
to this Agreement shall be prepared in accordance with such principles.
II. THE CREDIT
2.1 Revolving Credit Loans.
(a) Subject to the terms and conditions hereof and in reliance upon
the representations, warranties and covenants contained herein, each Bank
agrees, severally and not jointly with the other Banks, to make revolving credit
loans (collectively called the "Revolving Credit Loans" and each individually a
"Revolving Credit Loan") to the Borrowers from time to time during the period
commencing on the Closing Date and ending three (3) years following the Closing
Date, or on any earlier date as provided in Section 2.7(b) or Section 8.1 hereof
(the "Revolver Termination Date"), in principal amounts not to exceed at any
time outstanding in the aggregate the amount set forth opposite the name of each
such Bank on the signature page hereof (each such amount being hereinafter
called such Bank's "Revolving Loan Commitment" and collectively, the Banks'
"Aggregate Revolving Loan Commitment"). All Loans shall be made by the Banks
simultaneously and pro rata in accordance with the Revolving Loan Commitments.
The failure of any one or more of the Banks to make Revolving Credit Loans in
accordance with its or their obligations shall not relieve the other Banks of
their several obligations under this Section 2.1(a), but in no event shall the
aggregate amount at any one time outstanding which any Bank shall be required to
lend under this Section 2.1(a) exceed the amount of such Bank's Revolving Loan
Commitment at that time.
(b) The Borrowers may request Revolving Credit Loans to bear
interest at either the Adjusted Base Rate or LIBO Rate options described in
Section 2.4. The Revolving Credit Loans outstanding at any one time may involve
any combination of such interest rate options in such amounts as the Borrowers
may determine, subject to the terms and conditions hereof, including the
requirement concerning minimum Loan requests and the requirements that (i) no
request may be made which would require more than one interest rate option or
more than one Interest Period to apply to a single Revolving Credit Loan, and
(ii) in the case of LIBO Rate Loans, no LIBO Rate Loan may have an Interest
Period extending beyond the Revolver Termination Date.
(c) Notwithstanding the foregoing, the Borrowers shall not be
entitled to a Revolving Credit Loan if, after giving effect to such Revolving
Credit Loan, the unpaid principal amount of the Revolving Credit Loans to the
Borrowers exceeds the Aggregate Revolving Loan Commitment.
(d) Except for Revolving Credit Loans which exhaust the full
remaining amount of the Aggregate Revolving Loan Commitment and conversions
which result in the conversion of all Revolving Credit Loans subject to a
particular interest rate option, each of which may be in lesser amounts, each
Loan when made and each conversion of Loans of one type into Loans of another
type hereunder shall be in an amount at least equal to $500,000 or, if greater,
then in such minimum amount plus $100,000 multiples.
(e) Within the limits of the Aggregate Revolving Loan Commitment,
the Borrowers may borrow, prepay (in accordance with Section 2.8) and reborrow
Revolving Credit Loans. All Revolving Credit Loans shall, in any event, be
repaid by the Borrowers on the Revolver Termination Date.
(f) If any principal of a LIBO Rate Loan shall be voluntarily
repaid (whether upon prepayment, reduction of the Aggregate Revolving Loan
Commitment after acceleration or for any other reason) or converted to a Base
Rate Loan pursuant to Section 2.11 prior to the last day of the Interest Period
applicable to such LIBO Rate Loan or if the Borrowers fail for any reason to
borrow a LIBO Rate Loan after giving irrevocable notice pursuant to Section 2.3,
the Borrowers shall pay to each Bank, in addition to the principal and interest
then to be paid, such additional amounts as may be necessary to compensate each
Bank for all appropriate direct and indirect costs and losses (including losses
resulting from redeployment of prepaid or unborrowed funds at rates lower than
the cost of such funds to such Bank, and including lost profits incurred or
sustained by such Bank) as a result of such repayment or failure to borrow (the
"Additional Amount"). The Additional Amount (which each Bank shall take
reasonable measures to minimize) shall be specified in a written notice or
certificate delivered to the Borrowers by the Agent in the form provided by each
Bank sustaining such costs or losses. Such notice or certificate shall contain a
calculation in reasonable detail of the Additional Amount to be compensated and
shall be conclusive as to the facts and the amounts stated therein, absent
manifest error.
2.2 The Revolving Credit Notes. The Revolving Credit Loans made by each
Bank shall all be evidenced by a single promissory note of the Borrowers (each
such promissory note as it may be amended, extended, modified or renewed a
"Revolving Credit Note") in principal face amount equal to such Bank's Revolving
Loan Commitment, payable to the order of such Bank and otherwise in form and
substance satisfactory to the Banks. The Revolving Credit Notes shall be dated
the Closing Date, shall bear interest at the rate per annum and be payable as to
principal and interest in accordance with the terms hereof. The Revolving Credit
Notes shall mature upon the Revolver Termination Date, and upon maturity each
outstanding Revolving Credit Loan evidenced thereby shall be due and payable.
The Agent shall maintain records of all Loans evidenced by the Revolving Credit
Notes and of all payments thereon, which records shall be conclusive absent
manifest error.
2.3 Funding Procedures.
(a) Each request for a Revolving Credit Loan or the conversion or
renewal of an interest rate with respect to a Loan shall be made not later than
11:00 a.m. on a Business Day by delivery to the Agent of a written request
signed by IGC on behalf of the Borrowers or, in the alternative, a telephone
request followed promptly by written confirmation of the request, specifying the
date and amount of the Loan to be made, converted or renewed, selecting the
interest rate option applicable thereto, and in the case of LIBO Rate Loans,
specifying the Interest Period applicable to such Loan. The form of request
attached hereto as Exhibit A ("Borrowing Notice") shall be used to request the
making, conversion or renewal of Revolving Credit Loans unless otherwise agreed.
Each request shall be received not less than one (1) Business Day prior to the
date of the proposed borrowing, conversion or renewal in the case of Base Rate
Loans, and three (3) London Business Days prior to the date of the proposed
borrowing, conversion or renewal in the case of LIBO Rate Loans. No request
shall be effective until actually received in writing by the Agent.
(b) Upon receipt of a request for a Loan or the conversion of a
Loan, and if the conditions precedent provided herein shall be satisfied at the
time of such request, the Agent promptly shall notify each Bank of such request
and of such Bank's ratable share of such Loan. Upon receipt by the Agent, the
request for a Loan or the conversion of a Loan shall not be revocable by the
Borrowers.
(c) Not later than 11:00 A.M. on the date of each Loan, each Bank
shall make available (except as provided in clause (d) below) its ratable share
of such Loan, in immediately available funds, to the Agent at the address set
forth in Section 10.6 hereof or at such account in London as the Agent shall
specify to the Borrowers and the Banks. Unless the Agent knows that any
applicable condition specified herein has not been satisfied, the Agent will
make the funds so received from the Banks immediately available to the Borrowers
on the date of each Loan by a credit to the account of the Borrowers at the
Agent's aforesaid address.
(d) Unless the Agent shall have been notified by any Bank at least
one (1) Business Day prior to the date of the making, conversion or renewal of
any LIBO Rate Loan, or by 3:00 P.M. on the date a Base Rate Loan is requested,
that such Bank does not intend to make available to the Agent such Bank's
portion of the total amount of the Loan to be made, converted or renewed on such
date, the Agent may assume that such Bank has made such amount available to the
Agent on the date of the Loan and the Agent may, in reliance upon such
assumption, make available to the Borrowers a corresponding amount. If and to
the extent such Bank shall not have made such funds available to the Agent, such
Bank agrees to repay the Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Borrowers until the date such amount is repaid to the Agent, at
the Federal Funds Rate plus 50 basis points for three (3) Business Days, and
thereafter at the Base Rate. If such Bank shall repay to the Agent such
corresponding amount, such amounts so repaid shall constitute such Bank's Loan
for purposes of this Agreement. If such Bank does not repay such corresponding
amount forthwith upon the Agent's demand therefor, the Agent shall promptly
notify the Borrowers, and the Borrowers shall immediately pay such corresponding
amount to the Agent, without any prepayment penalty or premium, but with
interest on the amount repaid, for each day from the date such amount is made
available to the Borrowers until the date such amount is repaid to the Agent, at
the rate of interest applicable at the time to such Loan. Nothing herein shall
be deemed to relieve any Bank of its obligation to fulfill its Revolving Loan
Commitment hereunder or to prejudice any rights which the Borrowers may have
against any Bank as a result of any default by such Bank hereunder.
(e) If the Banks make a Loan on a day on which all or any part of
an outstanding Loan from the Banks is to be repaid, each Bank shall apply the
proceeds of its new Loan to make such repayment and only an amount equal to the
difference (if any) between the amount being borrowed and the amount being
repaid shall be made available by such Bank to the Agent as provided in clause
(c).
2.4 Interest.
(a) Base Rate. Each Base Rate Loan shall bear interest on the
principal amount thereof from the date made until such Loan is paid in full or
converted, at a rate per annum equal to the Adjusted Base Rate determined from
time to time.
(b) LIBO Rate. Each LIBO Rate Loan shall bear interest on the
principal amount thereof from the date made until such Loan is paid in full,
renewed, or converted, at a rate per annum equal to the applicable LIBO Rate
plus the Applicable Margin determined from time to time.
(1) After receipt of a request for a LIBO Rate Loan, the Agent
shall proceed to determine the LIBO Rate to be applicable thereto. The Agent
shall give prompt notice by telephone or facsimile to the Borrowers and to each
Bank of the LIBO Rate thus determined in respect of each LIBO Rate Loan or any
change therein.
(2) In the event the Borrowers fail to, or are not permitted
to, select an Interest Period for any LIBO Rate Loan within the time period and
otherwise as provided herein, such Loan shall be automatically converted into a
Base Rate Loan on the last day of the Interest Period for such Loan.
(c) Competitive Bid Rate. For working capital advances, the
Borrowers may request the Agent to solicit competitive bids from the Banks for a
rate of interest (the "Competitive Bid Rate") quoted by the Banks, the amount
and duration of which Competitive Bid Rate shall be offered to the Borrowers in
each Bank's sole discretion; provided, however, that the Banks reserve the right
to limit the number of such requests for Competitive Bid Rate bids in any given
period. In the event that the Borrowers desire the Agent to solicit competitive
bids with respect to the Competitive Bid Rate, IGC, on behalf of the Borrowers,
shall notify the Agent of such request in writing in the manner set forth in
Section 10.6 hereof, with authorized signatures and with the executed original
sent to the Agent under separate cover (each, a "Request for Competitive Bids"),
the contents of which shall be irrevocable and binding on the Borrowers. The
Agent, upon receipt thereof, shall forward copies of such Request for
Competitive Bids to each Bank by telecopier on the day of such receipt in the
event that the Agent receives such Request for Competitive Bids not later than
11:00 a.m. that day and otherwise not later than 11:00 a.m. of the next Business
Day. Each Request for Competitive Bids shall specify (i) the requested borrowing
date (the "Borrowing Date"), (ii) the amount of the Loan desired, (iii) the use
of the Loan proceeds, and (iv) if applicable, the Interest Period applicable to
the desired advance. Each Bank shall have the right, but not the obligation, to
submit a bid to make such desired advance to the Borrowers; provided that such
bid, if any, shall be delivered in writing by telecopier to the Agent not later
than 11:00 a.m. on the Business Day next following the Bank's receipt of a copy
of the Request for Competitive Bids from the Agent (the "Bid Deadline"); and
provided further that such bid, if any, shall specify the principal amount which
such Bank is willing to make available to the Borrowers and the interest rate at
which such Bank is willing to make such advance available. The Agent agrees that
in the event it elects to submit a bid pursuant to such Request for Competitive
Bids, the Agent must submit its bid, if any, not later than thirty (30) minutes
prior to the Bid Deadline. The Agent shall furnish copies of the bids, if any,
which it receives on or before the Bid Deadline to IGC, by telecopier,
on the day of Agent's receipt thereof in the event that the Agent receives such
bids not later than 11:00 a.m. that day and otherwise not later than the next
Business Day. IGC shall determine the aggregate amount of any of the bids, if
any, submitted by the Banks which IGC desires to accept. To the extent that IGC
desires to accept some or all of the bids so submitted, IGC shall accept the
bids in order of the lowest to highest interest rates ("Bid Rates"), and IGC
must notify the Agent by telephone, confirmed in writing delivered to the Agent
by telecopier not later than 11:00 a.m. on the Business Day next following the
date on which IGC receives copies of the bids, if any, from the Agent (the
"Acceptance Deadline"). In the event that IGC fails to so notify the Agent prior
to the Acceptance Deadline of the amount of any of the bids, if any, submitted
by the Banks which IGC desires to accept, IGC shall automatically be deemed to
have rejected all such bids. If, pursuant to a particular Request for
Competitive Bids, two or more Banks bid at the same Bid Rate and the aggregate
amount of bids accepted by IGC is less than the aggregate amount of such bids,
then the amount to be borrowed at such Bid Rate shall be allocated among such
Banks according to their respective Commitment Percentages. Any amounts advanced
by any Bank pursuant to a Request for Competitive Bids as set forth in this
Section shall be deemed to be a Loan hereunder; provided, however, that any
advance made by a Bank pursuant to a Request for Competitive Bids shall not
reduce that Bank's obligation to advance its pro rata share of any remaining
undrawn availability under the Revolving Loan Commitment of such Bank.
Notwithstanding anything herein to the contrary, each Loan pursuant to a Request
for Competitive Bids shall be in an amount equal to or in excess of $500,000 and
shall be evidenced by a promissory note in the form attached hereto as Exhibit
C, with such changes thereto as may be required by the Bank making such Loan in
order to reflect the terms of such Loan.
(d) Renewals and Conversions of Loans. The Borrowers shall have the
right to convert Base Rate Loans into LIBO Rate Loans, and vice versa, and to
renew LIBO Rate Loans from time to time, provided that: (i) IGC, on behalf of
the Borrowers, shall give the Agent notice of each permitted conversion or
renewal as provided in Section 2.3 hereof; (ii) LIBO Rate Loans may be converted
or renewed only as of the last day of the applicable Interest Period for such
Loans; and (iii) no Interest Period may be renewed if on the proposed date of
conversion an Event of Default, or Potential Default exists or would thereby
occur. The Agent shall use its best efforts to notify the Borrowers of the
effectiveness of each such conversion or renewal, and the new interest rate to
which the converted or renewed Loan is subject, as soon as practicable after the
conversion; provided, however, that any failure to give such notice shall not
affect the Borrowers' obligations or the Banks' rights and remedies hereunder in
any way whatsoever.
(e) Continuing Liability of Borrowers. The liability of the
Borrowers under this Section 2.4 shall continue to be effective or be
automatically reinstated, as the case may be, if at any time payment, in whole
or in part, of any of the payments to the Banks is rescinded or must otherwise
be restored or returned upon the insolvency, bankruptcy, dissolution,
liquidation or reorganization of any Borrower or any other person, or upon or as
a result of the appointment of a custodian, receiver, trustee or other officer
with similar powers with respect to any Borrower or other Person or any
substantial part of its property, or otherwise, all as though such payment had
not been made.
2.5 Fees.
(a) The Borrowers shall pay to the Agent for the ratable benefit of
the Banks, and as compensation for the Banks' Revolving Loan Commitments, a fee
(the "Commitment Fee") computed at the rate per annum equal to 12.5 basis points
(0.125%) on the average daily amount of the unused portion of the Aggregate
Revolving Loan Commitment accrued from and after the date hereof. The Commitment
Fee shall be payable in arrears on the first day of each January, April, July
and October, commencing October 1, 1997 (for the three month period or portion
thereof ended on the preceding day), and on the Revolver Termination Date.
Payment shall be made to the Agent on behalf of the Banks and the Agent shall
promptly forward to each Bank the portion of the Commitment Fee amount due such
Bank. The Commitment Fee shall be calculated on the basis of a 360 day year.
(b) The Borrowers shall pay to the Agent for its own account, the
fees and expenses agreed to between the Borrowers and the Agent in the letter
agreement between the Agent and IGC, dated , 1997 (the "Side Letter").
2.6 Reduction or Termination of Aggregate Revolving Loan Commitment.
(a) Voluntary. The Borrowers may at any time, on not less than
three (3) Business Days' written notice, terminate or permanently reduce the
Aggregate Revolving Loan Commitment pro rata among the Banks, provided that any
reduction shall be in the amount of $1,000,000 or a multiple thereof and that no
such reduction shall cause the principal amount of Loans outstanding to exceed
the Aggregate Revolving Credit Commitment as reduced.
(b) Termination. In the event the Aggregate Revolving Loan
Commitment is terminated pursuant to the terms of this Agreement, the Revolver
Termination Date shall accelerate and the Borrowers shall, simultaneously with
such termination, repay the Base Rate Loans and LIBO Rate Loans in accordance
with Section 2.8.
2.7 Voluntary Prepayments.
(a) Base Rate Loans. On one (1) Business Day's notice to the Banks,
the Borrowers may, at their option, prepay the Base Rate Loans in whole at any
time or in part from time to time, provided that each partial prepayment shall
be in the principal amount of $500,000 or, if greater, then in $100,000
multiples.
(b) LIBO Rate Loans. The Borrowers may, at their option, prepay any
LIBO Rate Loan, provided that if the Borrowers shall prepay a LIBO Rate Loan
prior to the last day of the applicable Interest Period, or shall fail to borrow
any LIBO Rate Loan on the date such Loan is to be made, the Borrowers shall pay
to each Bank, in addition to the principal and interest then to be paid in the
case of a prepayment, on such date of prepayment, the Additional Amount incurred
or sustained by such Bank as a result of such prepayment or failure to borrow as
provided in Section 2.1(f)).
2.8 Payments.
(a) LIBO Rate Loans. Accrued interest on LIBO Rate Loans with
Interest Periods of one, two or three months shall be due and payable on the
last day of such Interest Period. Accrued interest on LIBO Rate Loans with
Interest Periods of six months shall be due and payable at the end of the third
month and on the last day of such Interest Period.
(b) Base Rate Loans. Accrued interest on all Base Rate Loans shall
be due and payable on the first Business Day of each month and upon the Revolver
Termination Date.
(c) Form of Payments; Application of Payments; Payment
Administration, Etc. Provided that no Event of Default or Potential Default then
exists, all payments and prepayments shall be applied to the Loans in such order
and to such extent as shall be specified by the Borrowers, by written notice to
the Agent at the time of such payment or prepayment. Except as otherwise
provided herein, all payments of principal, interest, fees, or other amounts
payable by the Borrowers hereunder shall be remitted to the Agent on behalf of
the Banks at the address set forth opposite its name on the signature page
hereof or at such office or account as the Agent shall specify to the Borrowers
and the Banks, in immediately available funds not later than 2:00 p.m. on the
day when due. The Agent will promptly distribute to each Bank by wire transfer
in immediately available funds each Bank's pro rata share of such payment based
upon such Bank's Commitment Percentage. Whenever any payment is stated as due on
a day which is not a Business Day, the maturity of such payment shall, except as
otherwise provided in the definition of "Interest Period" in Section 1.1, be
extended to the next succeeding Business Day and interest and commitment fees
shall continue to accrue during such extension. Each Borrower authorizes the
Agent to deduct from any account of any Borrower maintained at the Agent or over
which the Agent has control any amount payable under this Agreement, the Notes
or any other Loan Document which is not paid in a timely manner. The Agent's
failure to deliver any xxxx, statement or invoice with respect to amounts due
under this Section or under any Loan Document shall not affect the Borrowers'
obligations to pay any installment of principal, interest or any other amount
under this Agreement when due and payable.
(d) Net Payments. All payments made to the Banks and the Agent by
the Borrowers hereunder, under any Note or under any other Loan Document will be
made without set off, counterclaim or other defense. All such payments will be
made free and clear of, and without deduction or withholding for, any present or
future taxes, levies, imposts, duties, fees, assessments or other charges of
whatever nature, now or hereafter imposed, by any jurisdiction or any political
subdivision or taxing authority thereof or therein (but excluding, except as
provided below, any Bank Taxes (as defined herein)), and all interest, penalties
or similar liabilities with respect thereto (collectively, together with any
amounts payable pursuant to the next sentence, "Taxes"). The Borrowers shall
also reimburse each Bank, upon the written request of such Bank, for Taxes
imposed on or measured by the gross or net income of such Bank pursuant to the
laws of the United States of America (or any State or political subdivision
thereof), or the jurisdiction (or any political subdivision or taxing authority
thereof) in which the principal office or applicable lending office of such Bank
is located (collectively, "Bank Taxes") as such Bank shall determine are payable
by such Bank due to the amount of Taxes paid to or on behalf of such Bank
pursuant to this or the preceding sentence. If any Taxes are so levied or
imposed, each Borrower agrees to pay the full amount of such Taxes, and such
additional amounts as may be
necessary so that every payment of all amounts due hereunder, under any Note or
under any other Loan Document, after withholding or deduction for or on account
of any Taxes, will not be less than the amount provided for herein or in such
Note. Each Borrower will furnish to the Agent upon request certified copies of
tax receipts evidencing such payment by such Borrower. The Borrowers will, on a
joint and several basis, indemnify and hold harmless the Agent and each Bank,
and reimburse the Agent or such Bank upon its written request, for the amount of
any Taxes so levied or imposed and paid or withheld by such Bank.
2.9 Changes in Circumstances; Yield Protection.
(a) If any Regulatory Change or compliance by the Banks with any
request made after the date of this Agreement by the Board of Governors of the
Federal Reserve System or by any Federal Reserve Bank or other central bank or
fiscal, monetary or similar authority (in each case whether or not having the
force of law) shall:
(i) impose, modify or make applicable any reserve, special
deposit, Federal Deposit Insurance Corporation premium or similar
requirement or imposition against assets held by, or deposits in or
for the account of, or loans made by, or any other acquisition of
funds for loans or advances by, the Banks;
(ii) impose on the Banks any other condition regarding the
Notes;
(iii) subject the Banks to, or cause the withdrawal or
termination of any previously granted exemption with respect to,
any tax (including any withholding tax but not including any income
tax not currently causing the Banks to be subject to withholding)
or any other levy, impost, duty, charge, fee or deduction on or
from any payments due from the Borrowers; or
(iv) change the basis of taxation of payments from the
Borrowers to the Banks (other than by reason of a change in the
method of taxation of a Bank's net income);
and the result of any of the foregoing events is to increase the cost to a Bank
of making or maintaining any Loan or to reduce the amount of principal, interest
or fees to be received by the Bank hereunder in respect of any Loan, the Agent
will immediately so notify the Borrowers. If a Bank determines in good faith
that the effects of the change resulting in such increased cost or reduced
amount cannot reasonably be avoided or the cost thereof mitigated, then upon
notice by the Agent to the Borrowers, the Borrowers shall pay to such Bank on
each interest payment date of the Loan, such additional amount as shall be
necessary to compensate the Bank for such increased cost or reduced amount.
(b) If any Bank shall reasonably determine that any Regulation
regarding capital adequacy or the adoption of any Regulation regarding capital
adequacy, which Regulation is applicable to banks (or their holding companies)
generally and not such Bank (or its holding company) specifically, or any change
therein, or any change in the interpretation or administration thereof by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by such Bank (or its
holding company) with any such request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has the effect of reducing the rate of return on such Bank's
capital as a consequence of its obligations hereunder to a level below that
which such Bank could have achieved but for such adoption, change or compliance
(taking into consideration such Bank's policies with respect to capital
adequacy) by an amount reasonably deemed by such Bank to be material, the
Borrowers shall promptly pay to the Agent for the account of such Bank, upon the
demand of such Bank, such additional amount or amounts as will compensate such
Bank for such reduction.
(c) If the Agent shall reasonably determine (which determination
will be made after consultation with any Bank requesting same and shall be, in
the absence of fraud or manifest error, conclusive and binding upon all parties
hereto) that by reason of abnormal circumstances affecting the interbank
eurodollar or applicable eurocurrency market, adequate and reasonable means do
not exist for ascertaining the LIBO Rate to be applicable to the requested LIBO
Rate Loan or that eurodollar or eurocurrency funds in amounts sufficient to fund
all the LIBO Rate Loans are not obtainable on reasonable terms, the Agent shall
give notice of such inability or determination by telephone to the Borrowers and
to each Bank at least two (2) Business Days prior to the date of the proposed
Loan and thereupon the obligations of the Banks to make, convert other Loans to,
or renew such LIBO Rate Loan shall be excused, subject, however, to the right of
the Borrowers at any time thereafter to submit another request.
(d) Determination by a Bank for purposes of this Section 2.9 of the
effect of any Regulatory Change or other change or circumstance referred to
above on its costs of making or maintaining Loans or on amounts receivable by it
in respect of the Loans and of the additional amounts required to compensate
such Bank in respect of any additional costs, shall be made in good faith and
shall be evidenced by a certificate, signed by an officer of such Bank and
delivered to the Borrowers, as to the fact and amount of the increased cost
incurred by or the reduced amount accruing to the Bank owing to such event or
events. Such certificate shall be prepared in reasonable detail and shall be
conclusive as to the facts and amounts stated therein, absent manifest error.
(e) The affected Bank will notify the Borrowers of any event
occurring after the date of this Agreement that will entitle the Bank to
compensation pursuant to this Section as promptly as practicable after it
obtains knowledge thereof and determines to request such compensation. Said
notice shall be in writing, shall specify the applicable Section or Sections of
this Agreement to which it relates and shall set forth the amount of amounts
then payable pursuant to this Section. The Borrowers shall pay such Bank the
amount shown as due on such notice within 10 days after their receipt of the
same.
2.10 Illegality. Notwithstanding any other provision in this Agreement,
if the adoption of any applicable Regulation, or any change therein, or any
change in the interpretation or administration thereof by any Governmental
Authority, central bank, or comparable agency charged with the interpretation or
administration thereof, or compliance by the Banks with any request or directive
(whether or not having the force of law) of any such authority, central bank, or
comparable agency shall make it unlawful or impossible for the Banks to (1)
maintain their Revolving Loan Commitments, then upon notice to the Borrowers by
the Agent, the Revolving Loan Commitments shall terminate; or (2) maintain or
fund their LIBO Rate Loans, then upon notice to the Borrowers of such event, the
Borrowers' outstanding LIBO Rate Loans shall be converted into Base Rate Loans.
2.11 Joint and Several Liability. Each Borrower, on a joint and several
basis, unconditionally and irrevocably guarantees to each Bank the due, prompt
and complete payment by each other Borrower of its payment of principal of and
interest on each Revolving Credit Loan, when and as the same shall become due
and payable, and any and all other amounts with respect to which any other
Borrower is obligated under any Loan Document. The obligation of each Borrower
under this Section 2.11 is a guaranty of payment and not of collectability and
is no way conditioned or contingent upon any attempt to collect from or enforce
compliance by any other Borrower or upon any other event, contingency or
circumstance whatsoever. The obligation of each Borrower under this Section
shall be primary, absolute and unconditional, shall not be subject to any
counterclaim, set-off, deduction, diminution, abatement, recoupment, suspension,
deferment, reduction, or defense based upon any claim any Borrower or any other
Person may have against any other Borrower or any other Person, and shall remain
in full force and effect without regard to, and shall not be released,
discharged or in any way affected by, any circumstance or condition whatsoever
(whether or not any Borrower shall have any knowledge or notice thereof). No
Borrower shall be subrogated to the rights of the Banks in respect of any
payment or other obligation with respect to which an amount has been payable by
such Borrower under this Section 2.11 and no Borrower shall seek to exercise any
rights of subrogation, reimbursement or indemnity arising from payments made by
it pursuant to the provisions of this Section 2.11.
2.12 Optional Cash Management Facility. Should the Borrowers, or any of
them, become continuing borrowers with CoreStates or any other Bank and wish to
utilize the cash management services of CoreStates or such other Bank, the Banks
may agree to allow $500,000 of the Revolving Loan Commitment of CoreStates or
such other Bank to be dedicated to fund, on a daily basis, the cash management
requirements of such Borrower(s), without allocating such borrowings among the
Banks on a pro rata basis.
III. REPRESENTATIONS AND WARRANTIES
In order to induce the Banks to execute and deliver this Agreement and to
make the Loans available to the Borrowers, the Borrowers, jointly and severally,
represent and warrant to the Banks that:
3.1 Good Standing of the Borrowers; Authorization. Each of the Borrowers is
duly incorporated, validly existing and in good standing in its jurisdiction of
incorporation. Each Borrower is duly qualified as a foreign corporation and
authorized to do Business in all other jurisdictions wherein the nature of its
business or property makes such qualification necessary except where the failure
to so qualify would not have a material adverse effect on the financial
condition of such Borrower, and has the corporate power to own its properties
and to carry on its business as now conducted. The execution, delivery and
performance of this Agreement and the Loan Documents have been duly authorized
by all necessary corporate proceedings on the part of each of the Borrowers.
3.2 Compliance with Laws and Other Agreements. Each Borrower is in
compliance in all material respects with all Regulations applicable to such
Borrower and has not received, and has no knowledge of, any order or notice of
any governmental investigation or of any violation or claim of violation of any
Regulation that might have a materially adverse effect on any Borrower.
3.3 No Conflict; Governmental Approvals. The execution, delivery, and
performance of this Agreement and each of the Loan Documents will not (i)
conflict with, violate, constitute a default under, or result in a breach of any
provision of any applicable law, rule, regulation, judgment, decree, order,
instrument or other agreement, or (ii) conflict with or result in a breach of
any provision of the certificate or articles of incorporation or by-laws of any
Borrower. No authorization, permit, consent or approval of or other action by,
and no filing, registration or declaration with, any governmental authority or
regulatory body is required to be obtained or made by any Borrower for the due
execution and performance of this Agreement or any of the Loan Documents, except
such as have been duly obtained or made prior to the Closing Date and are in
full force and effect as of the Closing Date (copies of which have been
delivered to the Banks on or before the Closing Date).
3.4 Financial and Other Information Regarding Borrowers.
(a) The Borrowers have delivered to the Banks true, correct and
complete copies of the consolidated balance sheets of IGC and its consolidated
Subsidiaries as of May 23, 1997, and related statements of income for the period
then ended, together with notes thereto and the unqualified opinion thereon,
dated July 11, 1997, of KPMG Peat Marwick LLP. The Borrowers shall, upon request
by the Agent, supply the Banks with true and correct copies of consolidating
balance sheets of IGC and its consolidated subsidiaries for the aforementioned
periods. Those financial statements and the notes thereto (together, the
"Financial Statements") present fairly the financial position of IGC and its
consolidated Subsidiaries as at such dates and the results of their operations
for the periods then ended in conformity with GAAP.
(b) As of the date of this Agreement, no Borrower has any Indebtedness
other than as shown in the Financial Statements.
(c) Except as set forth on Schedule 3.4(c), as of the date of this
Agreement, no Borrower has any "investment" (as such term is defined under
GAAP), whether by stock purchase, capital contribution, loan, advance, purchase
of property or otherwise, in any Person.
3.5 Taxes. No Borrower is delinquent in the payment of any material income,
property or other tax, except for any delinquency in the payment of a tax which
is contested in good faith by a Borrower and for which appropriate reserves have
been established in accordance with GAAP.
3.6 Liens and Guaranties.
(a) All properties and assets of each Borrower are owned by that
Borrower free and clear of all Liens except (i) those for taxes or other
government charges either not yet delinquent or the nonpayment of which is
permitted by Section 3.5 of this Agreement; (ii) those not arising in connection
with Indebtedness that do not materially impair the use or value of the
properties or assets of that Borrower in the conduct of its businesses; (iii)
Liens whose release and termination is evidenced by the Borrowers' delivery to
the Banks of appropriate documents on the Closing Date; and (iv) Liens permitted
under the Loan Documents.
(b) Except as permitted hereby, no Borrower is obligated under any
Guaranty.
3.7 Material Adverse Changes. Since May 23, 1997, there has not been any
material adverse change in the business, operations, properties or financial
position of any of the Borrowers. No Borrower knows of any fact (other than
matters of a general economic or political nature) which materially adversely
affects, or, so far as that Borrower can now reasonably foresee, will materially
adversely affect, the business, operations, properties or financial position of
any Borrower or the performance by any Borrower of its obligations under this
Agreement and the other Loan Documents.
3.8 Compliance with Federal Reserve Board Regulations. No part of the
proceeds of the Loans will be used, directly or indirectly, for the purpose of
purchasing or carrying any "margin security" within the meaning of Regulations G
or U of the Board of Governors of the Federal Reserve System (12 C.F.R. 207,
221), or for the purpose of purchasing or carrying or trading in any securities
under such circumstances as to involve any Borrower in a violation of Regulation
X of the said Board (12 C.F.R. 224). The assets of the Borrowers do not include
any margin securities, and no Borrower has any present intention of acquiring
any margin security.
3.9 ERISA. The provisions of each Plan maintained by any Borrower complies
in all material respects with all applicable requirements of ERISA and of the
Code, and with all applicable rulings and regulations issued under the
provisions of ERISA and the Code setting forth those requirements. No Reportable
Event has occurred with respect to any Plan; no Plan to which Section 4021 of
ERISA applies has been terminated; no Plan has incurred any liability to PBGC as
provided in Section 4062, 4063 and 4064 of ERISA; no Plan has been involved in
any prohibited transaction within the meaning of Section 406 of ERISA or Section
4975 of the Code; and no Termination Event has occurred.
3.10 Pending Litigation. There are no actions, suits, proceedings or
investigations pending, or, to the knowledge of any of the Borrowers, threatened
against or affecting any Borrower, before any court, arbitrator or
administrative or governmental body which, in the aggregate, might adversely
affect any action taken or to be taken by any Borrower under this Agreement and
the other Loan Documents or which, in the aggregate, might materially adversely
affect the business, operations, properties or financial position of any
Borrower, or the ability of any Borrower to perform its obligations under this
Loan Agreement and the other Loan Documents.
3.11 Valid, Binding and Enforceable. This Agreement and the Loan Documents
have been duly and validly executed and delivered by the parties thereto (other
than the Banks) and constitute the valid and legally binding obligations of such
parties enforceable in accordance with their respective terms, except as
enforcement of this Agreement, and the Loan Documents may be limited by
bankruptcy, insolvency or other laws of general application relating to or
affecting the enforcement of creditors' rights and except as enforcement is
subject to general equitable principles.
3.12 No Untrue Statements. Neither this Agreement, the Loan Documents nor
any other document, certificate or statement furnished or to be furnished by the
Borrowers or by any other party to the Banks in connection herewith contains, or
at the time of delivery will contain, any untrue statement of a material fact or
omits or will omit to state a material fact necessary in order to make the
statements contained herein and therein not misleading.
IV. CONDITIONS PRECEDENT
4.1 Conditions Precedent to All Loans. The obligation of each Bank to make
any Loan is conditioned upon the following:
(a) Documents. The Borrowers shall have delivered and the Agent shall
have received a Borrowing Notice and all such other documents as may be
reasonably requested by the Banks; provided, that if the Banks should request
any such additional documents, the Borrowers shall have thirty (30) days
following such request in which to deliver such additional documents to the
Agent.
(b) Covenants; Representations. Each Borrower shall be in compliance
with all covenants, agreements and conditions in each Loan Document and each
representation and warranty contained in each Loan Document shall be true with
the same effect as if such representation or warranty had been made on the date
such Loan is made or issued.
(c) Defaults. Immediately prior to and after giving effect to such
transaction, no Event of Default or Potential Default shall exist.
4.2 Conditions Precedent to First Loan. The obligation of each Bank to make
the first Loan hereunder is conditioned upon the following:
(a) Articles, Bylaws. The Agent shall have received copies of the
Articles or Certificates of Incorporation and Bylaws of each of the Borrowers,
certified by the Corporate Secretary or Assistant Corporate Secretary of each
such entity; together with a Certificate of Good Standing for each Borrower from
any jurisdiction where the nature of its business or the ownership of its
properties requires such qualification except where the failure to be so
qualified would not have a material adverse effect on the business, operations,
assets or condition (financial or otherwise) of the Borrowers and their
Subsidiaries taken as a whole.
(b) Evidence of Authorization. The Agent shall have received copies,
certified by the Corporate Secretary or Assistant Corporate Secretary of each
Borrower or other appropriate official in the case of a Person who is not a
Borrower, of all corporate or other action taken by each Person other than a
Bank who is a party to any Loan Document to authorize its execution and delivery
and performance of the Loan Documents and to authorize the Revolving Credit
Loans, together with such other related papers as the Banks shall reasonably
require.
(c) Incumbency. The Agent shall have received a certificate signed by
the Corporate Secretary or Assistant Corporate Secretary of each corporate
signatory to the Loan Documents other than a Bank, together with the true
signature of the officer or officers authorized to execute and deliver the Loan
Documents and certificates thereunder, upon which the Banks shall be entitled to
rely conclusively until the Agent shall have received a further certificate of
the appropriate secretary or assistant secretary amending the prior certificate
and submitting the signature of the officer or officers named in the new
certificate as being authorized to execute and deliver Loan Documents and
certificates thereunder;
(d) Notes. Each Bank shall have received an executed Note payable to the
order of such Bank.
(e) Documents. The Agent shall have received all certificates,
instruments and other documents then required to be delivered pursuant to any
Loan Documents, in each instance in form and substance reasonably satisfactory
to the Agent and the Banks.
(f) Consents. The Borrowers shall have provided to the Agent evidence
satisfactory to the Agent that all governmental, shareholder and third party
consents and approvals necessary in connection with the transactions
contemplated hereby have been obtained and remain in effect.
(g) Other Agreements. The Borrowers shall have executed and delivered
each other Loan Document required hereunder.
(h) Borrowing Notice. The Borrowers shall have delivered and the Agent
shall have received a Borrowing Notice, which shall, at a minimum, set forth the
information regarding the conversion of the Existing Indebtedness into a Base
Rate Loan or a LIBO Rate Loan.
(i) Fees. The Borrowers shall have paid all fees required as of the
Closing Date by Section 2.5 (a) and (b) hereof.
(j) Legal Opinion. The Agent shall have received a favorable written
opinion of general counsel to the Borrowers, which shall be addressed to the
Banks and be dated the date of the first Loan, in form and substance
satisfactory to the Banks.
V. AFFIRMATIVE COVENANTS
The Borrowers, jointly and severally, hereby covenant and agree that, from
and after the date hereof and so long as the Revolving Loan Commitments are in
effect or any Obligations remain unpaid or outstanding, unless the Required
Banks have otherwise consented in writing, the Borrowers shall do the following:
5.1 Use of Proceeds. Use the proceeds of the Loans only for working capital
and Permitted Acquisitions.
5.2 Accounting Records, Reports and Financial Statements. Furnish to the
Agent:
(a) Within one hundred and five (105) days after the end of each fiscal
year, IGC's Form 10-K filed with the Securities and Exchange Commission for that
year, including consolidated financial statements of IGC and the other
Borrowers. Such financial statements shall present fairly the consolidated
financial position of IGC and the other Borrowers as of the close of such year
and the results of its operations and changes in its financial position during
such year, in accordance with GAAP, and shall be audited and accompanied by the
unqualified opinion of an independent public accountant acceptable to the Banks.
With each Form 10-K delivered to the Banks, the Borrowers shall, upon request by
the Agent, supply, as supplemental information, unaudited consolidating
financial statements of the Borrowers used in the preparation of such Form 10-K;
(b) Within sixty (60) days after the end of each fiscal quarter, IGC's
Form 10-Q filed with the Securities and Exchange Commission for that quarter,
including unaudited consolidated financial statements of IGC and the other
Borrowers. Such financial statements shall present fairly the financial position
of the Borrowers as of the end of such quarter and the results of their
operations and changes in their financial position during each quarter in
accordance with GAAP. With each Form 10-Q delivered to the Banks, IGC, on behalf
of all Borrowers, shall, upon request by the Agent, supply, as supplemental
information, consolidating financial statements of the Borrowers used in the
preparation of such Form 10-Q;
(c) With reasonable promptness, and when reasonably requested by the
Banks unless any Borrower's compliance with such request would conflict with any
law, regulation or contractual obligation applicable to such Borrower, copies of
all financial reports, statements and returns which each Borrower shall file
with any federal or state department, commission, board, bureau, agency or
instrumentality and any report,
statement or return delivered by any Borrower to any supplier or other creditor
which is material to that Borrower's operations or financial condition;
(d) Within sixty (60) days after the end of each fiscal quarter, a
complete and fully-executed Covenant Compliance Certificate; and
(e) All such other documents and information as may be reasonably
requested by the Banks, within thirty (30) days following any such request by
the Banks.
5.3 Ordinary Course of Business; Records. Conduct its business only in the
ordinary course and keep accurate and complete books and records of its assets,
liabilities and operations consistent with sound business practices and in
accordance with GAAP.
5.4 Information for the Banks. Make available during normal business hours
for inspection by the Banks or their designated representatives any of its books
and records when reasonably requested by the Banks to do so, and furnish the
Banks any information reasonably requested regarding their operations, business
affairs and financial condition within a reasonable time after the Banks give
notice of their request therefor. In particular, and without limiting the
foregoing, each Borrower shall permit, during normal business hours,
representatives of the Banks' Audit Departments to make such periodic
inspections of its books, records and assets as such representatives deem
necessary and proper. The first two sentences of this Section 5.4
notwithstanding, no Borrower shall be required to disclose any information which
such Borrower is required by law, regulation or contractual obligation to
maintain confidential, and the Banks shall use their best efforts to coordinate
the timing of any inspections made pursuant to this Section in order to minimize
any resultant disruption of the Borrowers' businesses.
5.5 Insurance. Carry and maintain, in full force and effect at all times with
financially sound and reputable insurers: (i) all workers' compensation or
similar insurance as may be required under the laws of any jurisdiction
applicable to such Borrower; (ii) public liability insurance against claims for
personal injury, death or property damage suffered upon, in or about any
premises occupied by them or occurring as a result of the ownership, maintenance
or operation by them of any automobile, truck or other vehicle or as a result of
the use of products manufactured, constructed or sold by them, or services
rendered by them; (iii) business interruption insurance covering risk of loss as
a result of the cessation for all or any part of one year of any substantial
part of the business conducted by them; (iv) insurance against such other risks
as are usually insured against by business entities of established reputation
engaged in the same or similar businesses and similarly situated. The insurance
specified in clauses (ii), (iii), and (iv) shall be maintained in such amounts
(and with co-insurance and deductibles) as such insurance is usually carried by
business entities of established reputation engaged in the same or similar
business and similarly situated.
5.6 Maintenance. Maintain their equipment, real property and other properties
in good condition and repair (normal wear and tear excepted) and pay and
discharge the cost of repairs thereto or maintenance thereof other than idle
equipment no longer used or useful, in connection with the Borrowers'
operations.
5.7 Taxes. Pay all taxes, assessments, charges and levies imposed upon them
or on any of their property, or which they are required to withhold and pay
over, and provide evidence of payment thereto to the Banks if the Banks so
request, except where contested in good faith by lawful and appropriate
proceedings and where adequate reserves therefor have been set aside on their
books; provided, however, that each Borrower shall pay all such taxes,
assessments, charges and levies forthwith whenever foreclosure on any lien which
attaches or security therefor appears imminent.
5.8 Leases. Pay all rent or other sums required by every lease to which any
Borrower is a party as the same become due and payable; perform all their
obligations as tenant or lessee thereunder except where contested in good faith
by lawful and appropriate proceedings and where adequate reserves therefor have
been set aside; and keep all such leases at all times in full force and effect
during the terms thereof.
5.9 Corporate Existence; Certain Rights; Laws. Do all things necessary to
preserve and keep in full force and effect the corporate existence, licenses,
rights, patents, trademarks, trade names and franchises of each Borrower (except
that any Borrower may merge into or consolidate with another Borrower as long as
the Agent receives written notice prior thereto) and comply with all present and
future laws, ordinances, rules and regulations applicable to them in the
operation of their businesses; provided, however, that a Borrower may terminate
any patent, trademark or license and other rights conferred by jurisdictions
outside the United States as long as such Borrower's business judgment requires
such termination.
5.10 Notice of Litigation. Give immediate notice to the Agent of the
institution of any litigation or any administrative proceeding involving any
Borrower which might materially and adversely affect the operation, financial
condition, property or business of any Borrower individually, or the Borrowers
as a whole.
5.11 Indebtedness. Jointly and severally, pay or cause to be paid when due
(or within applicable grace periods) all Indebtedness of the Borrowers.
5.12 Notice of Events of Default. Give immediate notice to the Agent if any
Borrower becomes aware of the occurrence of any Event of Default or Potential
Default, or of the failure of any Borrower to observe or perform any of the
conditions or covenants to be observed or performed by it under this Agreement.
5.13 ERISA. Maintain each Plan in compliance with all applicable requirements
of ERISA and of the Code and with all applicable rulings and regulations issued
under the provisions of ERISA and of the Code. As promptly as practicable (but
in any event not later than ten days) after any Borrower receives from the PBGC
a notice of intent to terminate any Plan or to appoint a trustee to administer
any Plan, after a Borrower has notified the PBGC that any Reportable Event has
occurred, or after a Borrower has filed a notice of intent to terminate with the
PBGC with respect to any Plan, a certificate of the chief executive officer of
that Borrower shall be furnished to the Agent setting forth the details with
respect to the events resulting in such
reportable event, as the case may be, and the action which such Borrower
proposes to take with respect thereto, together with a copy of the notice of
intent to terminate or to appoint a trustee from the PBGC, of the notice of such
reportable event or of a Borrower's notice of intent to terminate, as the case
may be.
5.14 Deposit Accounts. Use the Banks as their primary depository institutions
to the extent reasonably feasible unless otherwise agreed in writing by the
Banks; and notify the Agent, in writing and on a continuing basis, of all
deposit accounts and certificates of deposit (including the numbers thereof)
maintained with or purchased from other banks and other financial institutions.
5.15 Management. Furnish to the Agent within thirty (30) days of any election
or appointment of officers or directors, written notice of any change in the
persons who from time to time become officers and directors of each Borrower.
5.16 Financial Covenants. Observe the financial covenants set forth on
Schedule 5.16 hereto; provided, however, that the financial covenants set forth
in Schedule 5.16 shall supersede any financial covenants set forth in any other
agreement between CoreStates and any of the Borrowers.
VI. NEGATIVE COVENANTS
The Borrowers, jointly and severally, hereby covenant and agree that, from
and after the date hereof, and so long as the Revolving Loan Commitments are in
effect or any Obligations remain unpaid or outstanding, they will not do any one
or more of the following without first obtaining the written consent of the
Required Banks:
6.1 Fundamental Corporate Changes.
(a) Change any Borrower's name, enter into any merger, consolidation,
reorganization or recapitalization, or dissolve, provided that any Borrower may
merge into or consolidate with another Borrower;
(b) Sell, transfer, lease or otherwise dispose of all or (except in the
ordinary course of business) any material part of any Borrower's assets or any
significant product line or process of any Borrower; or
(c) Have any Subsidiary; provided, however, that IGC may have the other
Borrowers as its Subsidiaries and any Borrower may have a Subsidiary as long as
such Subsidiary becomes a party to this Agreement, and subject to its terms.
6.2 Indebtedness. Incur, create, assume or have any Indebtedness except (i)
existing Indebtedness reflected in the Financial Statements, (ii) existing
Indebtedness set forth on Schedule 6.2 attached hereto, (iii) Subordinated
Indebtedness issued by IGC in an aggregate amount not to exceed $30,000,000,
(iv) Indebtedness incurred pursuant to this Agreement,
(v) additional Indebtedness incurred to finance Permitted Acquisitions, and (vi)
purchase money Indebtedness for the acquisition of non-current assets following
the date of this Agreement; provided, however, that the aggregate of any
Indebtedness incurred from time to time pursuant to Section 6.5 of this
Agreement and clauses (v) and (vi) of this Section shall not exceed $12,000,000.
6.3 Liens. Create or allow any Lien to be on or otherwise affect any
Borrower's property or assets except:
(a) Liens in favor of the Banks;
(b) Liens for taxes, assessments and other governmental charges incurred
in the ordinary course of business which are not yet due and payable or which
are being properly contested in good faith by lawful and appropriate
proceedings;
(c) Pledges or deposits made in the ordinary course of business to
secure payment of workmen's compensation or to participate in any fund in
connection with xxxxxxx'x compensation, unemployment insurance or other social
security obligations;
(d) Good faith pledges or deposits made in the ordinary course of
business to secure performance of tenders, contracts (other than for the
repayment of Indebtedness) or leases or to secure statutory or surety, appeal,
indemnity, performance or other similar bonds required in the ordinary course of
business;
(e) Liens of mechanics, materialmen, warehousemen, carriers or other
similar liens, securing obligations incurred in the ordinary course of business
that are not yet due and payable or are being contested in good faith by
appropriate and lawful proceedings;
(f) Liens securing Indebtedness permitted under Subsections 6.2(i),
(ii), (iv) and (vi) of this Agreement;
(g) Liens, if any, otherwise expressly permitted by this Agreement.
6.4 Guaranties. Except for a guaranty of Indebtedness of another Borrower or
other guaranties of indebtedness not to exceed $1,000,000 in the aggregate,
directly or indirectly make any Guaranty.
6.5 Sales and Lease-Backs. Sell, transfer or otherwise dispose of any
property, real or personal, now owned or hereafter acquired, with the intention
of directly or indirectly taking back a lease on such property which
cumulatively in the aggregate has a fair market value in excess of $2,000,000.
6.6 Loans; Investments. Purchase, invest in, or make any loan in the nature
of an investment in the stocks, bonds, notes or other securities or evidence of
Indebtedness of any
Person (other than another Borrower) or make any loan or advance to or for the
benefit of any Person (other than to another Borrower) and except for short term
(less than one year) loans and advances to employees in the ordinary course of
business, except for (i) short-term obligations of the Treasury of the United
States of America; (ii) certificates of deposit issued by banks with
shareholders' equity of at least $100,000,000; (iii) repurchase agreements not
exceeding 29 days in duration by banks with shareholders' equity of at least
$100,000,000; (iv) notes and other instruments generally known as "commercial
paper" which arise out of current transactions, which have maturities at the
time of issuance thereof not exceeding nine months and which have, at the time
of such purchase, investment or other acquisition, either of the two highest
credit ratings of Standard & Poor's Corporation or Xxxxx'x Investors Service,
Inc.; (v) other investments in an aggregate amount not to exceed $5,000,000
during the period commencing on the Closing Date and ending on the Revolver
Termination Date; and (vi) Permitted Acquisitions.
6.7 Change in Business. Discontinue any substantial part, or change the
nature of, the business of IGC and its Subsidiaries taken as a whole or enter
into any new business unrelated to the present business conducted by IGC and its
Subsidiaries, taken as a whole.
6.8 Sale or Discount of Receivables. Sell any notes receivable or account
receivable, with or without recourse.
6.9 ERISA.
(a) Terminate any Plan maintained by any Borrower to which Section 4021
of ERISA applies;
(b) Allow the value of the benefits guaranteed under Title IV of ERISA
to exceed the value of assets allocable to such benefits; or
(c) Incur a withdrawal liability within the meaning of Section 4201 of
ERISA.
6.10 Restricted Payments. Declare or pay any dividend (except stock
dividends), or make any distributions of cash or property, to holders of any
shares of its capital stock, or, directly or indirectly, redeem or otherwise
acquire any such shares of any Borrower; provided, however, that: (i) payments
of one Borrower to another Borrower shall be permitted (as long as the recipient
Borrower holds shares of the payee Borrower's stock); (ii) IGC may pay cash
dividends in any fiscal year in an amount not exceeding its Net Income for the
preceding fiscal year; and (iii) IGC may make payments pursuant to its existing
stock buy-back program.
VII. DEFAULT
The Borrowers shall be in default if any one or more of the following
events (each an "Event of Default") occurs and is continuing, whatever the
reason therefor:
7.1 Borrowers' Failure to Pay. The Borrowers jointly or severally fail to
pay any amount of principal, interest, fees or other sums as and when due under
this Agreement or any of the Loan Documents, whether upon stated maturity,
acceleration, or otherwise and have not
remedied and fully cured such failure to pay within ten (10) Business Days after
the date such payment is so due.
7.2 Breach of Covenants or Conditions. The Borrowers, individually or
collectively, fail to perform or observe any term, covenant, agreement or
condition in this Agreement or any of the other Loan Documents or are in
violation of or non-compliance with any provision of this Agreement or any of
the Loan Documents, and have not remedied and fully cured such non-performance,
non-observance, violation of or non-compliance within thirty (30) days after the
Agent has given written notice thereof to the Borrowers; provided, however, that
during such thirty (30) day period the Banks' obligations to make further Loans
to the Borrowers shall be suspended.
7.3 Defaults in Other Agreements. The Borrowers, individually or
collectively, fail to perform or observe any material term, covenant, agreement
or condition contained in any other agreement applicable to the Borrowers
(except for financial covenants contained in any other agreement between
CoreStates and any of the Borrowers that are superseded by the financial
covenants set forth on Schedule 5.16) or by which they are individually or
collectively bound involving a material liability of any Borrower which shall
not be remedied within the period of time (if any) within which such other
agreement permits such default to be remedied, unless such default is waived by
the other party thereto or excused as a matter of law.
7.4 Agreements Invalid. The validity, binding nature of, or enforceability
of any material term or provision of any of the Loan Documents is disputed by,
on behalf of, or in the right or name of any Borrower or any material term or
provision of any such Loan Document is found or declared to be invalid,
avoidable, or non-enforceable by any court of competent jurisdiction.
7.5 False Warranties; Breach of Representations. Any warranty or
representation made by the Borrowers, individually or collectively, in this
Agreement or any other Loan Document or in any certificate or other writing
delivered under or pursuant to this Agreement or any other Loan Document, or in
connection with any provision of this Agreement or related to the transactions
contemplated hereby shall prove to have been false or incorrect or breached in
any material aspect on the date as of which made.
7.6 Judgments. A final judgment or judgments is entered, or an order or
orders of any judicial authority or governmental entity is issued against the
Borrowers, individually or collectively, (such judgment(s) and order(s)
hereinafter collectively referred to as "Judgment") (i) for payment of money,
which Judgment, in the aggregate, exceeds Two Hundred Thousand Dollars
($200,000.00) outstanding at any one time; or (ii) for injunctive or declaratory
relief which would have a material adverse effect on the ability of any Borrower
individually or the Borrowers as a whole to conduct their business, and such
Judgment is not discharged or execution thereon or enforcement thereof stayed
pending appeal, within thirty (30) days after entry or issuance thereof, or, in
the event of such a stay, such Judgment is not discharged within thirty (30)
days after such stay expires.
7.7 Bankruptcy or Insolvency of a Borrower.
(a) A Borrower becomes insolvent, or generally fails to pay, or is
generally unable to pay, or admits in writing its inability to pay, its debts as
they become due or applies for, consents to, or acquiesces in , the appointment
of a trustee, receiver or other custodian for it or a substantial part of its
property, or makes a general assignment for the benefit of creditors.
(b) A Borrower commences any bankruptcy, reorganization, debt
arrangement, or other case or proceeding under any state or federal bankruptcy
or insolvency law, or any dissolution or liquidation proceeding.
(c) Any bankruptcy, reorganization, debt arrangement, or other case or
proceeding under any state or federal bankruptcy or insolvency law, or any
dissolution or liquidation proceeding, is involuntarily commenced against or in
respect of a Borrower, which is not dismissed within forty-five (45) days, or an
order for relief is entered in any such proceeding.
(d) A trustee, receiver, or other custodian is appointed for a Borrower
or a substantial part of its property.
VIII. REMEDIES
8.1 Further Advances; Acceleration; Setoff.
(a) Upon the occurrence of any one or more Events of Default, the
Agent shall, upon the written request of the Required Banks, terminate the
Revolving Loan Commitments and refuse to make any further advances or Loans to
the Borrowers.
(b) Automatically upon the occurrence of any Event of Default
described in Section 7.6 of this Agreement, and in the sole discretion of the
Required Banks upon the occurrence of any other Event of Default, the unpaid
principal balance of all Loans, all interest and fees accrued and unpaid
thereon, and all other amounts and Obligations payable by the Borrowers under
this Agreement and the other Loan Documents shall immediately become due and
payable in full, all without protest, presentment, demand, or further notice of
any kind to the Borrowers, all of which are expressly waived by the Borrowers.
(c) If any one or more Events of Default shall have occurred, the
Banks, any affiliate of any Bank and any other participant in the Loans shall
have the right, in addition to all other rights and remedies available to them,
without notice to the Borrowers, to apply toward and set-off against and apply
to the then unpaid balance of the Notes and the other Obligations any items or
funds held by any Bank or any such affiliate or participant, any and all
deposits (whether general or special, time or demand, matured or unmatured,
fixed or contingent, liquidated or unliquidated) now or hereafter maintained by
any Borrower for its own account with any Bank or any such affiliate or
participant, and any other indebtedness at any time held or owing by any Bank or
any such affiliate or participant, to or for the credit or the account of such
Borrowers. For such purpose, the Banks and any such affiliate or participant
shall have, and each Borrower
hereby grant to the Banks and any such affiliate or participant, a first lien on
all such deposits. The Banks and any such affiliate or participant are hereby
authorized to charge any such account or indebtedness for any amounts due to the
Banks and any such affiliate or participant. Such right of set-off shall exist
whether or not the Banks shall have made any demand under this Agreement, the
Notes or any other Loan Document and whether or not the Notes and the other
Obligations are matured or unmatured. Each Borrower hereby confirms the Banks'
and any such affiliate's or participant's lien on such accounts and right of
set-off, and nothing in this Agreement shall be deemed any waiver or prohibition
of such lien and right of set-off.
(d) Any date on which the Loans and such other obligations are
declared due and payable pursuant to this Section shall be the Revolver
Termination Date for purposes of this Agreement. Prior to the Revolver
Termination Date, so long as an Event of Default shall have occurred and be
continuing, and at all times after the Revolver Termination Date the Loans shall
bear interest at the Default Rate.
8.2 Further Remedies. Upon the occurrence of any one or more Events of
Default, the Agent and the Banks may proceed to protect and enforce their rights
under this Agreement and the other Loan Documents by exercising such remedies as
are available to the Agent and the Banks in respect thereof under applicable
law, either by suit in equity or by action at law, or both, whether for specific
performance of any provision contained in this Agreement or any of the other
Loan Documents or in aid of the exercise of any power granted in this Agreement
or any of the other Loan Documents.
IX. AGENT
9.1 Appointment and Authorization. Each Bank hereby irrevocably appoints and
authorizes the Agent to take such action on its behalf and to exercise such
powers under this Agreement and the Loan Documents as are specifically delegated
to the Agent by the terms hereof or thereof, together with such other powers as
are reasonably incidental thereto. The relationship between the Agent and each
Bank has no fiduciary aspects, and the Agent's duties (as Agent) hereunder are
acknowledged to be only ministerial and not involving the exercise of discretion
on its part. Nothing in this Agreement or any Loan Document shall be construed
to impose on the Agent any duties or responsibilities other than those for which
express provision is made herein or therein. In performing its duties and
functions hereunder, the Agent does not assume and shall not be deemed to have
assumed, and hereby expressly disclaims, any obligation with or for the
Borrowers. As to matters not expressly provided for in this Agreement or any
Loan Document, the Agent shall not be required to exercise any discretion or to
take any action or communicate any notice, but shall be fully protected in so
acting or refraining from acting upon the instructions of the Required Banks and
their respective successors and assigns; provided, however, that in no event
shall the Agent be required to take any action which exposes it to personal
liability or which is contrary to this Agreement, any Loan Document or
applicable law, and the Agent shall be fully justified in failing or refusing to
take any action hereunder unless it shall first be specifically indemnified to
its satisfaction by the Banks against any and all liability and expense which
may be incurred by it by reason of taking or omitting to take any such action.
If an indemnity furnished to the Agent for any purpose shall, in the reasonable
opinion of the Agent, be insufficient or become impaired, the Agent may call for
additional indemnity from the Banks and not commence or cease to do the acts for
which such indemnity is requested until such additional indemnity is furnished.
9.2 Duties and Obligations. In performing its functions and duties hereunder
on behalf of the Banks, the Agent shall exercise the same care and skill as it
would exercise in dealing with loans for its own account. Neither the Agent nor
any of its directors, officers, employees or other agents shall be liable for
any action taken or omitted to be taken by it or them under or in connection
with this Agreement or any Loan Document except for its or their own gross
negligence or willful misconduct. Without limiting the generality of the
foregoing, the Agent (a) may consult with legal counsel and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken by it in good faith and in accordance with the advice of such experts; (b)
makes no representation or warranty to any Bank as to, and shall not be
responsible to any Bank for, any recital, statement, representation or warranty
made in or in connection with this Agreement, any Loan Document or in any
written or oral statement (including a financial or other such statement),
instrument or other document delivered in connection herewith or therewith or
furnished to any Bank by or on behalf of any Borrower; (c) shall have no duty to
ascertain or inquire into any Borrower's performance or observance of any of the
covenants or conditions contained herein or to inspect any of the property
(including the books and records) of any Borrower or inquire into the use of the
proceeds of the Revolving Credit Loans or (unless the officers of the Agent
active in their capacity as officers of the Agent on the Borrowers' account have
actual knowledge thereof or have been notified in writing thereof) to inquire
into the existence or possible existence of any Event of Default or Potential
Default; (d) shall not be responsible to any Bank for the due execution,
legality, validity,
enforceability, effectiveness, genuineness, sufficiency, collectability or value
of this Agreement or any other Loan Document or any instrument or document
executed or issued pursuant hereto or in connection herewith, except to the
extent that such may be dependent on the due authorization and execution by the
Agent itself; (e) except as expressly provided herein in respect of information
and data furnished to the Agent for distribution to the Banks, shall have no
duty or responsibility, either initially or on a continuing basis, to provide to
any Bank any credit or other information with respect to any Borrower, whether
coming into its possession before the making of the Loans or at any time or
times thereafter; and (f) shall incur no liability under or in respect of this
Agreement or any other Loan Document for, and shall be entitled to rely and act
upon, any notice, consent, certificate or other instrument or writing (which may
be by facsimile (telecopier), telegram, cable, or other electronic means)
believed by it to be genuine and correct and to have been signed or sent by the
proper party or parties.
9.3 The Agent as a Bank. With respect to its Revolving Loan Commitment and
the Loans made and to be made by it, the Agent shall have the same rights and
powers under this Agreement and all other Loan Documents as the other Banks and
may exercise the same as if it were not the Agent. The terms "Bank" and "Banks"
as used herein shall, unless otherwise expressly indicated, include the Agent in
its individual capacity. The Agent and any successor Agent which is a commercial
bank, and their respective affiliates, may accept deposits from, lend money to,
act as trustee under indentures of and generally engage in any kind of business
with, the Borrowers and their affiliates from time to time, all as if such
entity were not the Agent hereunder and without any duty to account therefor to
any Bank.
9.4 Independent Credit Decisions. Each Bank acknowledges to the Agent that
it has, independently and without reliance upon the Agent or any other Bank, and
based upon such documents and information as it has deemed appropriate, made its
own independent credit analysis and decision to enter into this Agreement. Each
Bank also acknowledges that it will, independently or through other advisers and
representatives but without reliance upon the Agent or any other Bank, and based
upon such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or refraining from taking
any action under this Agreement or any Loan Document.
9.5 Indemnification. The Banks agree to indemnify the Agent (to the extent
not reimbursed by the Borrowers), ratably in proportion to each Bank's
Commitment Percentage, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses and
disbursements of any kind or nature whatsoever which may be imposed on, incurred
by or asserted against the Agent in such capacity in any way relating to or
arising out of this Agreement or any Loan Document or any action taken or
omitted to be taken by the Agent in such capacity hereunder or under any Loan
Document; provided that none of the Banks shall be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the Agent's gross
negligence or willful misconduct. Without limiting the generality of the
foregoing, each Bank agrees to reimburse the Agent, promptly on demand, for such
Bank's ratable share (based upon the aforesaid apportionment) of any
out-of-pocket expenses (including counsel fees and disbursements) incurred by
the Agent in connection with the preparation, execution,
administration or enforcement of, or the preservation of any rights under, this
Agreement and the Loan Documents to the extent that the Agent is not reimbursed
for such expenses by the Borrowers.
9.6 Successor Agent. The Agent may resign at any time by giving written
notice of such resignation to the Banks and the Borrowers, such resignation to
be effective only upon the appointment of a successor Agent as hereinafter
provided. Additionally, the Agent may be removed by the Required Banks if: (i)
the aggregate Commitment Percentages of the Agent and its affiliates do not
equal at least fifteen percent (15%); or (ii) a conservator, receiver or trustee
in bankruptcy is appointed for the Agent and such appointment is not vacated
within ninety (90) days of such appointment. Upon any such resignation or
removal of the Agent, the Banks shall jointly appoint a successor Agent upon
written notice to the Borrowers and the retiring or removed Agent. If no
successor Agent shall have been jointly appointed by such Banks and shall have
accepted such appointment within thirty (30) days after a retiring Agent shall
have given notice of resignation, the retiring Agent may, upon notice to the
Borrowers and the Banks, appoint a successor Agent. Upon its acceptance of any
appointment as Agent hereunder, the successor Agent shall succeed to and become
vested with all the rights, powers, privileges and duties of the previous Agent,
and the previous Agent shall be discharged from its duties and obligations as
Agent under this Agreement and the Loan Documents. After any Agent's resignation
or removal hereunder, the provisions hereof shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was the Agent under this
Agreement and the Loan Documents.
9.7 Allocations Made By Agent. As between the Agent and the Banks, unless a
Bank objecting to a determination or allocation made by the Agent pursuant to
this Agreement delivers to the Agent written notice of such objection within one
hundred twenty (120) days after the date any distribution was made by the Agent,
such determination or allocation shall be conclusive on such one hundred
twentieth day and only those items expressly objected to in such notice shall be
deemed disputed by such Bank. The Agent shall not have any duty to inquire as to
the application by the Banks of any amounts distributed to them.
9.8 Benefits of Article IX. The parties hereto agree that the provisions of
this Article IX are intended solely for the benefit of the Agent, and the Banks
and the Borrowers shall not be entitled to rely on any provisions or assert any
such provisions of this Article in any claim or as a defense against the Agent
or the Banks.
9.9 Mutual Disclosure. The Banks and the Agent each agree to disclose to the
others immediately upon receipt any information that is not required to be
delivered pursuant to Section 9.10 of this Agreement and (i) that concerns the
financial condition of the Borrowers and is material to the conduct of the
Borrowers' business operations as going concerns, or (ii) relates to the ability
of the Borrowers to perform their respective obligations under the Loan
Documents. In addition, if any Bank receives any notice, document, financial
statement or report from the Borrowers which such Bank is aware has not been
delivered to the other Banks and the Agent, such Bank shall promptly forward to
the other Banks and the Agent a copy of such notice, document, financial
statement or report.
9.10 Reports and Notices. The Borrowers hereby agree that whenever herein or
in any other Loan Document any report, notice, statement or other information is
to be given to any Bank or the Agent, such report, notice, statement or other
information shall be given to all Banks contemporaneously and within the period
of time required for giving such report, notice, statement or information.
X. MISCELLANEOUS
10.1 Waiver. No failure or delay on the part of the Agent or any Bank or any
holder of any Note in exercising any right, power or remedy under any Loan
Document shall operate as a waiver thereof; nor shall any single or partial
exercise of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy under any
Loan Document. The remedies provided under the Loan Documents are cumulative and
not exclusive of any remedies provided by law.
10.2 Amendments. No amendment, modification, termination or waiver of any
Loan Document or any provision thereof nor any consent to any departure by any
Borrower therefrom shall be effective unless the same shall have been approved
in writing by all of the Banks, be in writing and be signed by the Agent and the
applicable Borrower or Borrowers, and then any such waiver or consent shall be
effective only in the instance and for the specific purpose for which given. No
notice to or demand on the Borrowers shall entitle the Borrowers to any other or
further notice or demand in similar or other circumstances. Notwithstanding any
other provision contained in any Loan Document, no amendment, modification,
termination or waiver shall affect the payment of principal (including without
limitation the date when due), reduce any interest rate margin or any fee
provided herein, increase any Revolving Loan Commitment, extend the Revolver
Termination Date, modify the definition of "Required Banks" or any voting rights
of the Banks without the written consent of all the Banks. The rights and
responsibilities of the Agent hereunder cannot be changed without the Agent's
prior written consent.
10.3 Governing Law. The Loan Documents and all rights and obligations of the
parties thereunder shall be governed by and be construed and enforced in
accordance with the laws of the Commonwealth of Pennsylvania without regard to
Pennsylvania or federal principles of conflict of laws.
10.4 Participations and Assignments. Each Borrower hereby acknowledges and
agrees that a Bank may at any time:
(a) grant participations in all or any portion of its Revolving Loan
Commitment, any Note, or of its right, title and interest therein or in or to
this Agreement (collectively, "Participations") to any other lending office or
to any other bank, lending institution or other entity which has the requisite
sophistication to evaluate the merits and risks of investments in Participations
("Participants") (but only with the consent of the Borrowers, which consent
shall not be unreasonably withheld); provided, however, that: (i) all amounts
payable by the Borrowers hereunder shall be determined as if such Bank had not
granted such
Participation; (ii) any agreement pursuant to which any Bank may grant a
Participation: (x) shall provide that such Bank shall retain the sole right and
responsibility to enforce the obligations of the Borrowers hereunder including,
without limitation, the right to approve any amendment, modification or waiver
of any provisions of this Agreement; (y) such participation agreement may
provide that such Bank will not agree to any modification, amendment or waiver
of this Agreement without the consent of the Participant if such modification,
amendment or waiver would reduce the principal of or rate of interest on the
Loan or postpone the date fixed for any payment of principal of or interest on
the Loan; and (z) shall not relieve such Bank from its obligations, which shall
remain absolute, to make Loans hereunder; and (iii) notwithstanding the
foregoing, if any Event of Default with respect to Sections 5.16 or 7.1 of this
Agreement has occurred within the six (6) months immediately preceding the date
of the proposed participation (whether or not such Event of Default is ongoing
or has been cured), the consent of the Borrowers and the Agent shall not be
necessary to such participation; and
(b) assign any of its Loans and its Revolving Credit Commitment (but
only with the consent of the Borrowers and the Agent, which consent shall not be
unreasonably withheld), provided that: (i) each such assignment shall be in an
amount of at least $5,000,000 (unless, after giving effect to such assignment
and all other such assignments by such assigning Bank occurring simultaneously
or substantially simultaneously therewith, such assigning Bank shall hold no
Revolving Credit Commitment or Loan hereunder); (ii) each such assignment by a
Bank of its Loans or Revolving Credit Commitment shall be made in such manner so
that the same portion of its Loans, Note and Revolving Credit Commitment is
assigned to the respective assignee; and (iii) notwithstanding the foregoing, if
any Event of Default with respect to Sections 5.16 or 7.1 of this Agreement has
occurred within the six (6) months immediately preceding the date of the
proposed assignment (whether or not such Event of Default is ongoing or has been
cured), the consent of the Borrowers and the Agent shall not be necessary to
such assignment. Upon execution and delivery by the assignee to the Borrowers
and the Agent of an instrument in writing pursuant to which such assignee agrees
to become a "Bank" hereunder (if not already a Bank) having the Revolving Credit
Commitment(s) and Loans specified in such instrument, and upon consent thereto
by the Borrowers and the Agent, to the extent required above, the assignee shall
have, to the extent of such assignment (unless otherwise provided in such
assignment with the consent of the Borrowers and the Agent), the obligations,
rights and benefits of a Bank hereunder holding the Revolving Credit
Commitment(s) and Loans (or portions thereof) assigned to it (in addition to the
Revolving Credit Commitment(s) and Loans, if any, theretofore held by such
assignee) and the assigning Bank shall, to the extent of such assignment, be
released from the Commitment(s) (or portion(s) thereof) so assigned. Upon each
such assignment the assigning Bank shall pay the Agent an assignment fee of
$3,000.
10.5 Captions. Captions in the Loan Documents are included for convenience of
reference only and shall not constitute a part of any Loan Document for any
other purpose.
10.6 Notices. All notices, requests, demands, directions, declarations and
other communications between the Banks and the Borrowers provided for in any
Loan Document shall, except as otherwise expressly provided, be mailed by
registered or certified mail, return receipt
requested, or telegraphed, or
telefaxed, or delivered in hand to the applicable party at the following
addresses:
If to the Borrowers:
Intermagnetics General Corporation
000 Xxx Xxxxxxxxx Xxxx
Xxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx, Senior Vice President - Finance
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to:
Intermagnetics General Corporation
000 Xxx Xxxxxxxxx Xxxx
Xxxxxx, XX 00000
Attention: Xxxxxxxxxxx X. Xxxx, Esquire, Corporate Counsel
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
If to the Agent or the Banks:
CoreStates Bank, N.A.
000 Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attention: Xxx Xxxxx, Vice President
Telephone:(000) 000-0000
Telecopy:(000) 000-0000
with a copy to:
Duane, Morris & Heckscher LLP
Xxx Xxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx, Esquire
Telephone: (000) 000-0000
Telecopy:(000) 000-0000
Notices shall be effective and deemed received three (3) days after being
deposited in the mails, postage prepaid, addressed as aforesaid and shall
whenever sent by telegram, telegraph or telefax or delivered in hand be
effective when received. Any party may change its address by a communication in
accordance herewith.
10.7 Sharing of Collections, Proceeds and Set-Offs; Application of Payments.
(a) If any Bank, by exercising any right of set-off, counterclaim or
foreclosure against trade collateral or otherwise, receives payment of principal
or interest or other amount due on any Loan which is greater than the percentage
share of such Bank (determined as set forth below), the Bank receiving such
proportionately greater payment shall purchase such participations in the Loans
held by the other Banks, and such other adjustments shall be made as may be
required, so that all such payments shall be shared by the Banks on the basis of
their percentage shares; provided that if all or any portion of such
proportionately greater payment of such indebtedness is thereafter recovered
from, or must otherwise be restored by, such purchasing Bank, the purchase shall
be rescinded and the purchase price restored to the extent of such recovery, but
without interest being paid by such purchasing Bank. The percentage share of
each Bank shall be based on the portion of the outstanding Loans of such Bank
(prior to receiving any payment for which an adjustment must be made under this
Section in relation to the aggregate outstanding Loans of all the Banks. Each
Borrower agrees, to the fullest extent it may effectively do so under applicable
law, that any holder of a participation in a Loan or reimbursement obligation,
whether or not acquired pursuant to the foregoing arrangements, may exercise
rights of set-off or counterclaim and other rights with respect to such
participation as fully as if such holder of a participation were a direct
creditor of such Borrower in the amount of such participation. If under any
applicable bankruptcy, insolvency or other similar law, any Bank receives a
secured claim in lieu of a set-off to which this Section would apply, such Bank
shall, to the extent practicable, exercise its rights in respect of such secured
claim in a manner consistent with the rights of the Banks entitled under this
Section to share in the benefits of any recovery on such secured claim.
(b) If an Event of Default or Potential Default shall have occurred and
be continuing the Agent and each Bank and the Borrowers agree that all payments
on account of the Loans shall be applied by the Agent and the Banks as follows:
(1) First, to the Agent for any Agent fees then due and payable under
this Agreement until such fees are paid in full;
(2) Second, to the Agent for any fees, costs or expenses (including
expenses described in Section 10.8) incurred by the Agent under any of
the Loan Documents or this Agreement, then due and payable and not
reimbursed by the Borrowers or the Banks until such fees, costs and
expenses are paid in full;
(3) Third, to the Banks for their percentage shares of the Commitment
Fee then due and payable under this Agreement until such fee is paid in
full;
(4) Fourth, to the Banks for their respective shares of all costs,
expenses and fees then due and payable from the Borrowers until such
costs, expenses and fees are paid in full;
(5) Fifth, to the Banks for their percentage shares of all interest
then due and payable from the Borrowers until such interest is paid in
full, which percentage shares shall be calculated by determining each
Bank's percentage share (determined as set forth in Section 10.7(a)) of
the amounts allocated in (a) above; and
(6) Sixth, to the Banks for their percentage shares of the principal
amount of the Loans then due and payable from the Borrowers until such
principal is paid in full, which percentage shares shall be calculated by
determining each Bank's percentage share (determined as set forth in
Section 10.7(a)) of the amounts allocated in (a) above.
10.8 Expenses of the Agent; Indemnification of the Agent and the Banks.
(a) The Borrowers will from time to time reimburse the Agent promptly
following demand for all reasonable out-of-pocket expenses (including the
reasonable fees and expenses of legal counsel) in connection with (i) the
preparation of the Loan Documents, (ii) the making of any Loans, (iii) the
administration of the Loan Documents, (iv) the enforcement of the Loan
Documents, and (v) the Side Letter; and will reimburse the Banks for all
out-of-pocket expenses (including reasonable fees and expenses of legal counsel)
in connection with the foregoing, including, without limitation, the enforcement
of the Loan Documents, which expenses shall not be unreasonable. Notwithstanding
the foregoing, the Bank shall use their good faith best efforts to engage common
legal counsel with respect to any attempts by the Banks to enforce any of the
Loan Documents.
(b) In addition to the payment of the foregoing expenses, the Borrowers
hereby agree, jointly and severally, to indemnify, protect and hold the Agent,
each Bank and any holder of the Notes and the officers, directors, employees,
agents, affiliates and attorneys of the Agent, each Bank and such holder
(collectively, the "Indemnitees") harmless from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses and disbursements of any kind or nature, including reasonable
fees and expenses of legal counsel, which may be imposed on, incurred by, or
asserted against such Indemnitee by any Borrower or other third parties and
arise out of or relate to this Agreement or the other Loan Documents or any
other matter whatsoever related to the transactions contemplated by or referred
to in this Agreement or the other Loan Documents; provided, however, that the
Borrowers shall have no obligation to an Indemnitee hereunder to the extent that
the liability incurred by such Indemnitee has been determined by a court of
competent jurisdiction to be the result of gross negligence or willful
misconduct of such Indemnitee.
10.9 Survival of Warranties and Certain Agreements. All agreements,
representations and warranties made or deemed made herein shall survive the
execution and delivery of this Agreement, the making of the Loans hereunder and
the execution and delivery of the Notes. Notwithstanding anything in this
Agreement or implied by law to the contrary, the agreements of the Borrowers set
forth in Sections 2.1(f), 2.5(a), 2.10, and 10.8, and the agreements of the
Banks set forth in Sections 9.1, 9.5 and 10.7 shall survive the payment of the
Loans and the termination of this Agreement. This Agreement shall remain in full
force and effect until the latest to occur of the termination of the Aggregate
Revolving Loan Commitment or the repayment in full of all amounts owed by the
Borrowers under any Loan Document.
10.10 Severability. The invalidity, illegality or unenforceability in any
jurisdiction of any provision in or obligation under this Agreement, the Notes
or other Loan Documents shall not affect or impair the validity, legality or
enforceability of the remaining provisions or obligations under this Agreement,
the Notes or other Loan Documents or of such provision or obligation in any
other jurisdiction.
10.11 Banks' Obligations Several; Independent Nature of Banks' Rights. The
obligation of each Bank hereunder is several and not joint and no Bank shall be
the agent of any other (except to the extent the Agent is authorized to act as
such hereunder). No Bank shall be responsible for the obligation or commitment
of any other Bank hereunder. In the event that any Bank at any time should fail
to make a Loan as herein provided, the other Banks, or any of them as may then
be agreed upon, at their sole option, may make the Loan that was to have been
made by the Bank so failing to make such Loan. Nothing contained in any Loan
Document and no action taken by Agent or any Bank pursuant hereto or thereto
shall be deemed to constitute Banks to be a partnership, an association, a joint
venture or any other kind of entity. The amounts payable at any time hereunder
to each Bank shall be a separate and independent debt, and, subject to the terms
of this Agreement, each Bank shall be entitled to protect and enforce its rights
arising out of this Agreement and it shall not be necessary for any other Bank
to be joined as an additional party in any proceeding for such purpose.
10.12 No Fiduciary Relationship. No provision in this Agreement or in any of
the other Loan Documents and no course of dealing between the parties shall be
deemed to create any fiduciary duty by Agent or any Bank to the Borrowers.
10.13 CONSENT TO JURISDICTION AND SERVICE OF PROCESS. EACH OF THE BORROWERS,
THE AGENT AND EACH BANK HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR
FEDERAL COURT LOCATED WITHIN THE EASTERN DISTRICT OF PENNSYLVANIA AND
IRREVOCABLY AGREES THAT, ANY ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING
TO THE NOTES, THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS MAYBE LITIGATED IN SUCH
COURTS. EACH PARTY TO THIS AGREEMENT ACCEPTS FOR ITSELF AND IN CONNECTION WITH
ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF
THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENT, AND
IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION
WITH THIS AGREEMENT, SUCH NOTE, OR SUCH OTHER LOAN DOCUMENT.
10.14 WAIVER OF JURY TRIAL. EACH OF THE BORROWERS, THE AGENT AND EACH BANK
HEREBY WAIVES ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, ANY OF THE LOAN DOCUMENTS,
OR ANY DEALINGS BETWEEN
THEM RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT AND THE LENDER/BORROWER
RELATIONSHIP ESTABLISHED HEREBY. THE SCOPE OF THIS WAIVER IS INTENDED TO BE
ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT
RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING WITHOUT LIMITATION,
CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW
AND STATUTORY CLAIMS. EACH OF THE BORROWERS, THE AGENT AND EACH BANK
ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO THE TRANSACTION, THAT
EACH HAS ALREADY RELIED ON THE WAIVER IN ENTERING INTO THIS AGREEMENT AND THAT
EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH
OF THE BORROWERS, THE AGENT AND EACH BANK FURTHER WARRANTS AND REPRESENTS THAT
EACH HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT EACH KNOWINGLY
AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL
COUNSEL. THIS WAIVER IS IRREVOCABLE, AND THE WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT,
THE LOAN DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE
LOANS. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
10.15 Counterparts; Effectiveness. This Agreement and any amendment hereto or
waiver hereof may be signed in any number of counterparts, each of which shall
be an original, with the same effect as if the signatures thereto and hereto
were upon the same instrument. This Agreement and any amendments hereto or
waivers hereof shall become effective when the Agent shall have received signed
counterparts or notice by telecopy of the signature page that the counterpart
has been signed and is being delivered to the Agent or facsimile that such
counterparts have been signed by all the parties hereto or thereto.
10.16 Use of Defined Terms. All words used herein in the singular or plural
shall be deemed to have been used in the plural or singular where the context or
construction so requires. Any defined term used in the singular preceded by
"any" shall be taken to indicate any number of the members of the relevant
class.
IN WITNESS WHEREOF, and intending to be legally bound hereby, the
Borrowers and the Banks have caused this Agreement to be executed by their
proper corporate officers thereunto duly authorized as of the day and year first
above written.
INTERMAGNETICS GENERAL CORPORATION
By: /s/ Xxxx X. Xxxxxx
-------------------------------
Name: Xxxx X. Xxxxxx
Title: CEO
APD CRYOGENICS INC.
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Treasurer
MAGSTREAM CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Treasurer
MEDICAL ADVANCES, INC.
By: /s/ Xxxx X. Xxxxxx
-------------------------------
Name: Xxxx X. Xxxxxx
Title: CEO
INTERCOOL ENERGY CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Treasurer
Commitment Percentage: 60% CORESTATES BANK, N.A.,
Revolving Loan Commitment: $15,000,000 individually
and as Agent
By: /s/ Xxx X. Xxxxx
----------------------------
Name: Xxx X. Xxxxx
Title: Vice President
Commitment Percentage: 40% THE CHASE MANHATTAN BANK
Revolving Loan Commitment: $10,000,000
By: /s/ Xxxxxxx X. Xxxxxxxxxx
----------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President
STATE OF NEW YORK )
) ss.
COUNTY OF ALBANY )
On this 23rd day of October, 1997, before me personally came Xxxx X.
Xxxxxx, to me known, who, being by me duly sworn, did depose and say that he is
the CEO of Intermagnetics General Corporation, the corporation described in and
which executed the foregoing instrument and that he signed his name thereto by
order of the board of directors of said corporation.
/s/ Xxxxxxxxx X. Xxxxxxx
NOTARY PUBLIC
STATE OF NEW YORK )
) ss.
COUNTY OF ALBANY )
On this 23rd day of October, 1997, before me personally came X. X.
Xxxxxxx, to me known, who, being by me duly sworn, did depose and say that he is
the Treasurer of APD Cryogenics Inc., the corporation described in and which
executed the foregoing instrument and that he signed his name thereto by order
of the board of directors of said corporation.
/s/ Xxxxxxxxx X. Xxxxxxx
NOTARY PUBLIC
STATE OF NEW YORK )
) ss.
COUNTY OF ALBANY )
On this 23rd day of October, 1997, before me personally came Xxxx X.
Xxxxxx, to me known, who, being by me duly sworn, did depose and say that he is
the CEO of Magstream Corporation, the corporation described in and which
executed the foregoing instrument and that he signed his name thereto by order
of the board of directors of said corporation.
/s/ Xxxxxxxxx X. Xxxxxxx
NOTARY PUBLIC
STATE OF NEW YORK )
) ss.
COUNTY OF ALBANY )
On this 23rd day of October, 1997, before me personally came Xxxx X.
Xxxxxx, to me known, who, being by me duly sworn, did depose and say that he is
the CEO of Medical Advances, Inc., the corporation described in and which
executed the foregoing instrument and that he signed his name thereto by order
of the board of directors of said corporation.
/s/ Xxxxxxxxx X. Xxxxxxx
NOTARY PUBLIC
STATE OF NEW YORK )
) ss.
COUNTY OF ALBANY )
On this 23rd day of October, 1997, before me personally came X.X.
Xxxxxxx, to me known, who, being by me duly sworn, did depose and say that he is
the Treasurer of InterCool Energy Corporation, the corporation described in and
which executed the foregoing instrument and that he signed his name thereto by
order of the board of directors of said corporation.
/s/ Xxxxxxxxx X. Xxxxxxx
NOTARY PUBLIC
STATE OF NEW YORK )
) ss.
COUNTY OF ALBANY )
On this 23 day of October, 1997, before me personally came Xxx Xxxxx,
to me known, who, being by me duly sworn, did depose and say that he is the Vice
President of CoreStates Bank, N.A., the corporation described in and which
executed the foregoing instrument and that he signed his name thereto by order
of the board of directors of said corporation.
/s/ Xxxxxxxxx X. Xxxxxxx
NOTARY PUBLIC
STATE OF NEW YORK )
) ss.
COUNTY OF ALBANY )
On this 23 day of October, 1997, before me personally came Xxxxxxx
Xxxxxxxxxx, to me known, who, being by me duly sworn, did depose and say that he
is the Vice President of The Chase Manhattan Bank, the corporation described in
and which executed the foregoing instrument and that he signed his name thereto
by order of the board of directors of said corporation.
/s/ Xxxxxxxxx X. Xxxxxxx
NOTARY PUBLIC
Exhibit A
Form of Borrowing Notice
CoreStates Bank, N.A.
000 Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attention: Xxx Xxxxx, Vice President
Ladies and Gentlemen:
The undersigned, INTERMAGNETICS GENERAL CORPORATION, on behalf of
itself and APD CRYOGENICS INC., MAGSTREAM CORPORATION, MEDICAL ADVANCES, INC.
and INTERCOOL ENERGY CORPORATION (collectively, the "Borrowers"), refers to the
Second Amended and Restated Loan and Agency Agreement, dated as of October 23,
1997, among the Borrowers, CoreStates Bank, N.A., as agent (the "Agent"), and
the Banks (as defined therein) (as amended, modified and/or extended to date,
the "Loan Agreement"), capitalized terms used herein having the definitions
given such terms in the Loan Agreement, and hereby:
1. Gives you notice, irrevocably, pursuant to Section 2.3 of the Loan
Agreement, that IGC on behalf of the Borrowers hereby requests a Loan
under the Loan Agreement and, in that regard, sets forth below the
information relating to that Loan (the "Proposed Advance") as required
by Section 2.3 of the Loan Agreement:
(a) the requested Business Day of the Proposed Advance is ______;
(b) the aggregate amount of the Proposed Advance is $________; and
(c) the Proposed Advance is intended to be a LIBO Rate Loan, and
the Interest Period for the Proposed Advance is ____ months;
or
the Proposed Advance is intended to be a Base Rate Loan.
2. Certifies to you as follows: (i) each Borrower is on the date hereof,
and will be on the date of the Proposed Advance, in compliance with all
covenants, agreements and conditions in each Loan Document; (ii) each
representation and warranty contained in each Loan Document is true on
the date hereof and will be true on the date of the Proposed Advance,
with the same effect as if such representation or warranty had been
made on each such respective date; and (iii) immediately prior to and
after giving effect to the Proposed Advance, no Event of Default or
Potential Default shall exist.
Very truly yours,
INTERMAGNETICS GENERAL CORPORATION
Dated: _______________, _________ By:
Name:
Title:
Exhibit B
Form of Covenant Compliance Certificate
CoreStates Bank, N.A.
000 Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attention: Xxx Xxxxx, Vice President
Ladies and Gentlemen:
This Covenant Compliance Certificate (this "Certificate") is executed
and delivered pursuant to Section 5.2(d) of the Second Amended and Restated Loan
and Agency Agreement, dated October 23, 1997 (the "Loan Agreement"), by and
among Intermagnetics General Corporation, APD Cryogenics Inc., Magstream
Corporation, Medical Advances, Inc. and InterCool Energy Corporation
(collectively, the "Borrowers"), the Banks (as such term is defined in the Loan
Agreement), and CoreStates Bank, N.A., as agent for the Banks (the "Agent"). All
capitalized terms used herein without definition shall have the meanings given
to them in the Loan Agreement and Schedule 5.16 thereto.
The undersigned has reviewed the terms of the Loan Agreement and has
made, or caused to be made under his or her supervision, a review in reasonable
detail of the transactions and financial condition of the Borrowers during the
fiscal period covered by this Certificate.
As of ________, the following financial covenants have the
following values:
COVENANT ACTUAL
----------- ---------
1. Minimum Tangible Net Worth $55,000,000 $
2. Maximum Ratio of Senior Debt 0.5:1.0
to Tangible Net Worth
3. Minimum Ratio of EBIT to 2.0:1.0
Interest Expenses
Attached hereto are the calculations and information necessary to
determine the foregoing covenant values.
As of the date hereof: (a) no Event of Default or Potential Default has
occurred and is continuing; (b) the representations and warranties of the
Borrowers contained in Article
III of the Loan Agreement are true and correct in all material respects as of
the date hereof, except that the representations and warranties in Section 3.4
of the Loan Agreement shall refer to the most recent financial statements
delivered to the Banks.
This Certificate is executed on _________, by the Chief Financial
Officer of IGC, on behalf of the Borrowers. The undersigned hereby certifies
that each and every matter contained herein is derived from the Borrowers'
books and records and is, to the best knowledge of the undersigned, true
and correct.
Chief Financial Officer,
Intermagnetics General Corporation
Schedule 5.16
Financial Covenants
This Schedule is a part of the Second Amended and Restated Loan
Agreement dated October 23, 1997 (the "Loan Agreement"), among CoreStates Bank,
N.A. (as Bank and Agent), The Chase Manhattan Bank, Intermagnetics General
Corporation, and the other parties defined therein as the "Borrowers."
A. Tangible Net Worth. The Borrowers shall at all times maintain a
Tangible Net Worth of not less than $55,000,000; provided, however, that if (i)
within six (6) months of the date hereof, IGC shall have consummated a
contemplated acquisition pursuant to a certain letter of intent, a copy of which
has been provided to the Agent, and (ii) IGC acquires not less than $7,000,000
in goodwill as a result of such transaction, then from and after the date of
such acquisition, the Borrowers shall at all times maintain a Tangible Net Worth
of not less than $50,000,000.
B. Ratio of Senior Debt to Tangible Net Worth. The Borrowers, on a
consolidated basis, shall have a ratio of Senior Debt to Tangible Net Worth at
the end of each fiscal quarter of not more than 0.5 to 1.0.
C. Ratio of EBIT to Interest Expenses. The Borrowers, on a consolidated
basis, shall have a ratio of EBIT to Interest Expenses at the end of each fiscal
quarter on a rolling four quarter basis, of not less than 2.0 to 1.0.
For purposes of this Schedule, all capitalized terms used herein and
not otherwise defined shall have the meanings given to them, respectively, in
the Loan Agreement, and the following terms shall have the following meanings:
"EBIT" shall mean, for any period, the Net Income (or net loss) of the
Borrowers on a consolidated basis for such period as determined in accordance
with GAAP, plus the sum of, without duplication, the following for the Borrowers
on a consolidated basis: (i) Interest Expenses, and (ii) total income tax
expense.
"Senior Debt" shall mean, at any time, all Indebtedness less all
Subordinated Indebtedness.
"Stockholders' Equity" shall mean, at any time, stockholders' equity as
determined in accordance with GAAP.
"Tangible Net Worth" shall mean, at any time, the aggregate
Stockholders' Equity, less all intangible assets of the Borrowers, on a
consolidated basis, including, without limitation, organization costs,
securities issuance costs, unamortized debt discount and expense, goodwill,
excess of purchase costs over net assets acquired, patents, trademarks,
trade names, copyrights, trade secrets, know how, licenses, franchises,
capitalized research and development expenses, and amounts owing from officers
and/or Affiliates.
