1
EXHIBIT 4.14
C$75,000,000
TERM CREDIT AGREEMENT
DATED AS OF FEBRUARY 5, 1999
BY AND AMONG
GOLDEN XXXXXX FINANCE COMPANY
(THE "BORROWER"),
THE MEN'S WEARHOUSE, INC.
(THE "PARENT"),
NATIONSBANK, N.A.,
INDIVIDUALLY AND AS AGENT
NATIONSBANC XXXXXXXXXX SECURITIES L.L.C.
AS LEAD ARRANGER
AND
THE OTHER FINANCIAL INSTITUTIONS LISTED
ON THE SIGNATURE PAGES HEREOF
(COLLECTIVELY, THE "BANKS")
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TABLE OF CONTENTS
Page
1. CERTAIN DEFINITIONS....................................................................................-1-
1.1. Accounting Principles.........................................................................-1-
1.2. Certain Defined Terms.........................................................................-1-
2. THE LOANS.............................................................................................-20-
2.1. Loans........................................................................................-20-
2.2. Borrowing Procedure..........................................................................-21-
3. INTEREST RATE PROVISIONS..............................................................................-22-
3.1. Interest Rate Determination..................................................................-22-
3.2. Utilization of Commitments ..................................................................-24-
3.3. Increased Cost and Reduced Return............................................................-25-
3.4. Limitation on Types of Loans.................................................................-27-
3.5. Illegality; Unavailability of Deposits.......................................................-27-
3.6. Treatment of Affected Loans..................................................................-28-
3.7. Compensation.................................................................................-29-
3.8. Replacement of Banks.........................................................................-29-
3.9. Survival.....................................................................................-30-
3.10. Yearly Rate..................................................................................-30-
4. PREPAYMENTS AND OTHER PAYMENTS........................................................................-30-
4.1. [Intentionally omitted]......................................................................-30-
4.2. Optional Prepayments.........................................................................-30-
4.3. Notice of Payments...........................................................................-30-
4.4. Place of Payment or Prepayment...............................................................-30-
4.5. No Prepayment Premium or Penalty.............................................................-31-
4.6. Taxes........................................................................................-31-
4.7. [intentionally omitted]......................................................................-33-
4.8. Payments on Business Day.....................................................................-33-
5. FEES..................................................................................................-34-
5.1. [Intentionally omitted]......................................................................-34-
5.2. Arrangement Fee..............................................................................-34-
5.3. Upfront Fees.................................................................................-34-
5.4. Administrative Agency Fee....................................................................-34-
5.5. [Intentionally omitted]......................................................................-34-
5.6. Fees Not Interest; Nonpayment................................................................-34-
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6. APPLICATION OF PROCEEDS...............................................................................-34-
7. REPRESENTATIONS AND WARRANTIES........................................................................-34-
7.1. Organization and Qualification...............................................................-34-
7.2. Financial Statements.........................................................................-35-
7.3. Litigation...................................................................................-35-
7.4. Default......................................................................................-35-
7.5. Title to Properties..........................................................................-35-
7.6. Payment of Taxes.............................................................................-35-
7.7. Conflicting or Adverse Agreements or Restrictions............................................-35-
7.8. Authorization, Validity, Etc.................................................................-36-
7.9. Investment Company Act Not Applicable........................................................-36-
7.10. Public Utility Holding Company Act Not Applicable............................................-36-
7.11. Margin Stock.................................................................................-36-
7.12. ERISA........................................................................................-37-
7.13. Full Disclosure..............................................................................-37-
7.14. Environmental Matters........................................................................-37-
7.15. Permits and Licenses.........................................................................-38-
7.16. Solvency.....................................................................................-38-
7.17. Capital Structure............................................................................-39-
7.18. Insurance....................................................................................-39-
7.19. Compliance with Laws.........................................................................-39-
7.20. No Consent...................................................................................-39-
7.21. Year 2000....................................................................................-39-
7.22. Acquisition Documents........................................................................-40-
8. CONDITIONS............................................................................................-40-
8.1. Conditions to Effectiveness of Agreement.....................................................-40-
8.2. Conditions to each Loan......................................................................-43-
9. AFFIRMATIVE COVENANTS.................................................................................-44-
9.1. Reporting and Notice Requirements............................................................-44-
9.2. Corporate Existence..........................................................................-47-
9.3. Books and Records............................................................................-47-
9.4. Insurance....................................................................................-47-
9.5. Right of Inspection..........................................................................-47-
9.6. Maintenance of Property......................................................................-48-
9.7. Guarantees of Certain Restricted Subsidiaries................................................-48-
9.8. Accounting Principles........................................................................-49-
9.9. Patents, Trademarks and Licenses.............................................................-49-
9.10. Taxes; Obligations...........................................................................-49-
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10. NEGATIVE COVENANTS....................................................................................-50-
10.1. Liens........................................................................................-50-
10.2. Debt.........................................................................................-50-
10.3. Restricted Payments..........................................................................-52-
10.4. Mergers; Consolidations; Sale or Other Dispositions of All or Substantially All
Assets................................................................................................-53-
10.5. Investments, Loans and Advances..............................................................-54-
10.6. Sale or Other Disposition of Less than Substantially All Assets; Sale and Leasebacks
-56-
10.7. Use of Proceeds..............................................................................-57-
10.8. Transactions with Affiliates.................................................................-57-
10.9. Nature of Business...........................................................................-57-
10.10. Issuance and Disposition of Shares...........................................................-58-
10.11. ERISA........................................................................................-58-
10.12. Discount or Sale of Receivables..............................................................-59-
10.13. Acquisitions.................................................................................-59-
10.14. Certain Financial Tests......................................................................-60-
10.15. Regulations T, U and X.......................................................................-60-
10.16. Status.......................................................................................-61-
10.17. Compliance with Laws.........................................................................-61-
10.18. Unrestricted Subsidiaries....................................................................-61-
10.19. Investments in Unrestricted Subsidiaries.....................................................-61-
10.20. No Commingling of Assets, Etc................................................................-61-
10.21. Restrictive Agreements.......................................................................-62-
10.22. Prepayments, Etc., of Certain Debt...........................................................-62-
10.23. Amendment of Acquisition Documents and Intercompany Credit Agreements
.....................................................................................................-63-
11. EVENTS OF DEFAULT; REMEDIES...........................................................................-63-
11.1. Failure to Pay Principal.....................................................................-63-
11.2. Failure to Pay Other Amounts.................................................................-63-
11.3. Default under Other Debt.....................................................................-64-
11.4. Misrepresentation or Breach of Warranty......................................................-64-
11.5. Violation of Covenants.......................................................................-64-
11.6. Bankruptcy and Other Matters.................................................................-64-
11.7. Dissolution..................................................................................-65-
11.8. Judgment.....................................................................................-65-
11.9. Nullity of Loan Documents....................................................................-65-
11.10. Change of Control............................................................................-65-
11.11. ERISA........................................................................................-65-
11.12. Guarantors; Pledge Agreement.................................................................-66-
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11.13. Related Facilities...........................................................................-66-
11.14. REVOCATION OF MOORES ACQUISITION; DEFAULT THEREUNDER.........................................-66-
11.15. Other Remedies...............................................................................-66-
11.16. Remedies Cumulative..........................................................................-67-
12. THE AGENT.............................................................................................-67-
12.1. Appointment, Powers and Immunities...........................................................-67-
12.2. Reliance by Agent............................................................................-68-
12.3. Defaults.....................................................................................-68-
12.4. Rights as Bank...............................................................................-68-
12.5. Indemnification..............................................................................-69-
12.6. Non-Reliance on Agent and Other Banks........................................................-69-
12.7. Successor Agent..............................................................................-69-
13. MISCELLANEOUS.........................................................................................-70-
13.1. Representation by the Banks..................................................................-70-
13.2. Waivers, Etc.................................................................................-70-
13.3. Notices......................................................................................-71-
13.4. GOVERNING LAW................................................................................-71-
13.5. Survival of Representations, Warranties and Covenants........................................-71-
13.6. Counterparts.................................................................................-72-
13.7. Separability.................................................................................-72-
13.8. Descriptive Headings.........................................................................-72-
13.9. Right of Set-off, Adjustments................................................................-72-
13.10. Assignments and Participations...............................................................-73-
13.11. Interest.....................................................................................-75-
13.12. Expenses; Indemnification....................................................................-76-
13.13. Payments Set Aside...........................................................................-78-
13.14. Loan Agreement Controls......................................................................-78-
13.15. Obligations Several..........................................................................-78-
13.16. SUBMISSION TO JURISDICTION; WAIVERS..........................................................-78-
13.17. WAIVER OF JURY TRIAL.........................................................................-79-
13.18. Amendments, Etc..............................................................................-79-
13.19. Relationship of the Parties..................................................................-80-
13.20. Currency Conversion and Currency Indemnity...................................................-80-
13.21. Confidentiality..............................................................................-81-
13.22. FINAL AGREEMENT..............................................................................-83-
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EXHIBITS
Exhibit A: Note
Exhibit B: Notice of Borrowing
Exhibit C: Notice of Rate Change/Continuation
Exhibit D: Compliance Certificate
Exhibit E: Affiliate Guaranty
Exhibit F: Assignment and Acceptance
SCHEDULES
Schedule 1: Applicable Lending Offices
Schedule 7.17: Capital Structure
Schedule 10.1: Liens
Schedule 10.2: Debt
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TERM CREDIT AGREEMENT
The Men's Wearhouse, Inc., a corporation organized under the
laws of the State of Texas (the "Parent"), Golden Moores Finance Company, a
Nova Scotia unlimited liability company (the "Borrower"), the financial
institutions listed on the signature pages hereof (collectively, the "Banks"
and individually, a "Bank"), and NationsBank, N.A. (together with any successor
thereof, "NationsBank") in its capacity as agent (the "Agent") for the Banks
hereunder, hereby agree as follows:
PRELIMINARY STATEMENT
WHEREAS, the Borrower has requested the Agent and the Banks
to make loans to the Borrower on the Closing Date in an aggregate amount not to
exceed C$75,000,000 and
WHEREAS, pursuant to the terms and conditions hereof the
Agent and the Banks have agreed to such request upon the terms and conditions
hereinafter set forth;
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
hereby agree as follows:
1. CERTAIN DEFINITIONS.
1.1. ACCOUNTING PRINCIPLES. All accounting terms not
specifically defined herein shall be construed in accordance with GAAP
consistent with those applied in the preparation of the audited financial
statements referred to in Section 9.1 hereof. All financial information
delivered to the Agent pursuant to Section 9.1 hereof shall be prepared in
accordance with GAAP applied on a basis consistent with those reflected by the
initial financial statements delivered to the Agent pursuant to Section 7.2,
except (i) where such principles are inconsistent with the requirements of this
Agreement and (ii) for those changes made pursuant to Section 9.8 hereof.
1.2. CERTAIN DEFINED TERMS. As used in this Agreement, the
following terms shall have the following meanings:
"Acquisitions" has the meaning specified in Section 10.13
hereof.
"Acquisition Documents" means the Combination Agreement, the
Subscription Agreement, and each of the other agreements otherwise delivered in
connection therewith or pursuant thereto to effect the transactions
contemplated by the Combination Agreement.
"Acquisition Target" means any Person acquired pursuant to
Section 10.13.
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"Adjusted Debt" means, at any time and without duplication,
an amount equal to the sum of (a) Total Funded Debt plus (b) an amount equal to
the product of (i) Base Rent Expense for the immediately preceding quarter
times (ii) thirty-two (32).
"Adjusted Eurodollar Rate" means, for any Eurodollar Loan for
any Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) determined by the Agent to be equal to
the quotient obtained by dividing (a) the Eurodollar Rate for such Eurodollar
Loan for such Interest Period by (b) 1 minus the Reserve Requirement for such
Eurodollar Loan for such Interest Period.
"Affiliate" means, with respect to a specified Person,
another Person that directly, or indirectly, through one or more
intermediaries, Controls or is Controlled by or is under common Control with
the Person specified. If any Person shall own, directly or indirectly,
beneficially and of record twenty percent (20%) or more of the equity (whether
outstanding capital stock, partnership interests or otherwise) of another
Person, such Person shall be deemed to be an Affiliate.
"Affiliate Guaranty" has the meaning set forth in Section
9.7.
"Affiliate Guarantor" means each Restricted Subsidiary which
shall execute and deliver an Affiliate Guaranty, or any supplement thereto,
pursuant to Section 9.7.
"Agent" shall have the meaning set forth in the preamble
hereto.
"Agreement" shall mean this Term Credit Agreement, as the
same may be amended, modified or supplemented from time to time.
"Applicable Lending Office" shall mean, with respect to each
Bank, such Bank's LIBOR Lending Office.
"Applicable Margin" means, (a) for the period from the
Closing Date until August 1, 1999, 1.00% per annum, and (b) thereafter, 0.75%.
"Assignment and Acceptance" shall have the meaning set forth
in Section 13.10(a).
"Bank" shall have the meaning specified in the preamble
hereto and shall include the Agent, in its individual capacity.
"Base Rent Expense" means, for any period, payments (whether
computed monthly or annually) due under Leases of real property (including
those resulting from sale-leaseback transactions), exclusive of payments for
percentage rent, common-area maintenance, insurance, taxes and any other
amounts recorded in the Parent's or the Restricted Subsidiaries' books and
records in accordance with their customary practices as rent other than "base
rent expense"; provided, with
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respect to any acquisition of an Acquisition Target which results in the
requirement to provide proforma financial information pursuant to Article 11 of
Regulation S-X (Reg ss. 210.11.01, .02 and .03), Base Rent Expense of the
Acquisition Target for each full fiscal quarter included in the applicable
computation period prior to such Acquisition (including the fiscal quarter
during which it was acquired) shall be included, provided further that Base
Rent Expense of the Acquisition Target shall be adjusted for those applicable
items of base rent expense that will increase or decrease subsequent to the
date of Acquisition, such adjustments limited to those like adjustments
included in the proforma financial statements provided in the Form 8-K filed
with the Securities and Exchange Commission pursuant to Article 11 of
Regulation S-X.
"Borrower" shall have the meaning set forth in the preamble
hereto.
"Borrowing Date" shall mean a date upon which the Borrower
has requested a Loan is to be made in a Notice of Borrowing delivered pursuant
to Section 2, which date shall be the Closing Date.
"Business Day" shall mean a day when the Agent is open for
business, provided that, if the applicable Business Day relates to any
Eurodollar Loan, it shall mean a day when the Agent is open for business and on
which commercial banks are open for international business in London.
"Canadian Dollar Equivalent Value" means, with respect to an
amount of U.S. Dollars, an amount of Dollars into which the Agent determines
that it could, in accordance with its practice from time to time in the
interbank foreign exchange market, convert such amount of U.S. Dollars,
determined by using its applicable quoted spot rate on the date on which such
equivalent is to be determined pursuant to the provisions of this Agreement.
"Canadian Prime Rate" means, for any day, the 30-day fixed
rate of interest per annum (calculated on the basis of a 365 or 366 day year)
from time to time established by Bank of Montreal as its reference rate of
interest for the determination of interest that it will charge to customers of
varying degrees of credit worthiness for Dollar loans.
"Canadian Prime Rate Loan" means any Loan which bears
interest at the Canadian Prime Rate.
"Canadian Revolving Credit Agreement" means that certain
Revolving Credit Agreement dated as of February 10, 1999 among Xxxxxx Retail
Group Inc., the Parent, Bank of America Canada, individually and as Agent, and
the other parties thereto, as amended from time to time.
"Capital Stock" means and includes (i) any and all shares,
interests, participations or other equivalents of or interests in (however
designated) corporate stock, including, without limitation, shares of preferred
or preference stock, (ii) all partnership interests (whether general or
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limited) in any Person which is a partnership, (iii) all membership interests
or limited liability company interests in any limited liability company, and
(iv) all equity or ownership interests in any Person of any other type.
"Cash Equivalents" means (a) marketable direct obligations
issued or unconditionally guaranteed by the United States Government or Canada
or issued by an agency thereof and backed by the full faith and credit of the
United States or Canada, as the case may be, in each case maturing within
ninety (90) days after the date of acquisition thereof; (b) marketable direct
obligations issued by any state of the United States of America or province of
Canada or any political subdivision of any such state or province or any public
instrumentality thereof maturing within ninety (90) days after the date of
acquisition thereof and, at the time of acquisition, having the highest rating
obtainable from either Standard & Poor's Corporation or Xxxxx'x Investors
Service, Inc. (or, if at any time neither Standard & Poor's Corporation nor
Xxxxx'x Investors Service, Inc. shall be rating such obligations, then from
such other nationally recognized rating services acceptable to the Agent); (c)
commercial paper maturing no more than ninety (90) days after the date of
creation thereof and, at the time of acquisition, having a rating of at least
A-1 or P-1 from either Standard & Poor's Corporation or Xxxxx'x Investors
Service, Inc. (or, if at any time neither Standard & Poor's Corporation nor
Xxxxx'x Investors Service, Inc. shall be rating such obligations, then the
highest rating from such other nationally recognized rating services acceptable
to the Agent); (d) domestic and eurodollar certificates of deposit or bankers'
acceptances maturing within ninety (90) days after the date of acquisition
thereof issued by any Bank or any commercial bank organized under the laws of
the United States of America or Canada or any state or province thereof or the
District of Columbia having combined capital and surplus of not less than
U.S.$250,000,000 (or the Canadian Dollar Equivalent Value thereof); (e)
repurchase agreements of the Agent or any commercial bank organized under the
laws of the United States of America or Canada or any state or province thereof
or the District of Columbia having combined capital and surplus of not less
than U.S.$250,000,000 (or the Canadian Dollar Equivalent Value thereof); (f)
overnight investments with the Agent or any commercial bank organized under the
laws of the United States of America or Canada or any state or province thereof
or the District of Columbia having combined capital and surplus of not less
than U.S.$250,000,000 (or the Canadian Dollar Equivalent Value thereof); (g)
other readily marketable instruments issued or sold by the Agent or any
commercial bank organized under the laws of the United States of America or
Canada or any state or province thereof or the District of Columbia having
combined capital and surplus of not less than U.S.$250,000,000 (or the Canadian
Dollar Equivalent Value thereof); and (h) funds invested in brokerage accounts
with nationally recognized brokerage houses or money market accounts, in each
case for less than thirty (30) days.
"Change/Continuation Date" shall mean a date upon which the
Borrower has requested the change or continuation of the interest rate
applicable to any Loan pursuant to a Notice of Rate Change/Continuation
delivered pursuant to Section 3.
"Change of Control" means (i) any transaction (including a
merger or consolidation) the result of which is that any "Person" or "group"
(within the meaning of Sections 13(d)
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and 14(d)(2) of the Exchange Act) becomes the "beneficial owner" (as defined in
Rule 13d-3 under the Exchange Act) of more than 50 percent (50%) of the total
voting power of all classes of the voting stock of the Parent or the surviving
Person and/or warrants or options to acquire such voting stock, calculated on a
fully diluted basis (a "Control Person"), other than any such transaction in
which the current executive officers of the Parent who are also currently
directors and their Affiliates or The Xxxxxx Family Foundation become,
individually or collectively, a Control Person; or (ii) the sale, lease or
transfer of all or substantially all of the Parent's assets (which includes the
assets of its Subsidiaries) to any "Person" or "group" (within the meaning of
Sections 13(d) and 14(d)(2) of the Exchange Act), except to the Parent or one
or more of its Subsidiaries.
"Closing Date" shall mean February 5, 1999.
"Code" shall mean the Internal Revenue Code of 1986, as
amended, as now or hereafter in effect, together with all regulations, rulings
and interpretations thereof or thereunder issued by the Internal Revenue
Service.
"Combination Agreement" means that certain Combination
Agreement dated as of November 18, 1998 among the Parent, Golden Moores
Company, Xxxxxx Retail Group Inc., and the other Persons which are a party
thereto, as amended, modified or supplemented from time to time in accordance
with the terms hereof.
"Commitment" shall mean, with respect to each Bank, such
Bank's Commitment, as defined in Section 2.1(a), and "Commitments" shall mean,
collectively, the Commitments of all of the Banks.
"Consolidated Current Assets" means all items classified as
current assets on the consolidated financial statements of the Parent and the
Restricted Subsidiaries delivered to the Banks pursuant to Section 9.1, all as
determined in accordance with GAAP consistently applied.
"Consolidated Current Liabilities" means all items classified
as current liabilities of Parent and the Restricted Subsidiaries on the
consolidated financial statements delivered to the Banks pursuant to Section
9.1 other than any current portion of (i) the outstanding Loans and (ii) Debt
outstanding under the Related Facilities, all as determined in accordance with
GAAP consistently applied.
"Consolidated Net Income" means with respect to any period,
net income of the Parent and the Restricted Subsidiaries on a consolidated
basis (after adjustment for income taxes), determined in accordance with GAAP.
"Consolidated Net Worth" means, as of any date, the total
shareholders' equity of the Parent and the Restricted Subsidiaries which
appears on the consolidated balance sheet of such Person as of such date,
determined in accordance with GAAP; excluding, however, (a) from total
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shareholders' equity mandatorily redeemable Preferred Stock of the Parent or a
Restricted Subsidiary to the extent included in total shareholders' equity and
(b) Restricted Investments by the Parent and the Restricted Subsidiaries in any
Unrestricted Subsidiaries.
"Contingent Liability" means (i) any agreement, undertaking
or arrangement by which any Person guarantees, endorses or otherwise becomes or
is contingently liable upon (by direct or indirect agreement, contingent or
otherwise, to provide funds for payment, to supply funds to, otherwise to
invest in, a debtor, or otherwise to assure a creditor against loss) the Debt,
obligation or any other liability of any other Person (other than by
endorsements of instruments in the ordinary course of collection), (ii)
obligations under surety, appeal or custom bonds, or (iii) guarantees of the
payment of dividends or other distributions upon the shares of or interest in
any other Person. The amount of any Person's obligation under any Contingent
Liability shall (subject to any limitations set forth therein) be deemed to be
the outstanding principal amount (or maximum principal amount, if larger) of
the Debt, obligation or other liability guaranteed thereby or, if applicable,
such lesser principal amount as is expressly stated to be the maximum principal
amount of such Person's obligation thereunder.
"Contractual Rent Expense" means, for any period as to the
Parent and the Restricted Subsidiaries, all payments (whether computed monthly
or annually) due under Leases of real property (including those resulting from
sale-leaseback transactions), including, without limitation, Base Rent Expense
and payments for percentage rent, common-area maintenance, insurance, and taxes
and any other amounts recorded in such Person's books and records in accordance
with their customary practices as rent expense, whether paid or accrued in the
applicable period of calculation, but excluding adjustments with respect to
such payments required to be made in conformity with GAAP for the purposes of
accounting for graduated lease payments, calculated for the four (4)
immediately preceding fiscal quarterly periods; provided, with respect to any
acquisition of an Acquisition Target which results in the requirement to
provide proforma financial information pursuant to Article 11 of Regulation S-X
(Reg ss. 210.11.01, .02 and .03), Contractual Rent Expense of the Acquisition
Target for each full fiscal quarter included in the applicable computation
period prior to such Acquisition (including the fiscal quarter during which it
was acquired) shall be included, provided further that Contractual Rent Expense
of the Acquisition Target shall be adjusted for those applicable items of
contractual expense that will increase or decrease subsequent to the date of
Acquisition, such adjustments limited to those like adjustments included in the
proforma financial statements provided in the Form 8-K filed with the
Securities and Exchange Commission pursuant to Article 11 of Regulation S-X.
"Control" means the possession, directly or indirectly, of
the power to direct or cause the direction of the management or policies of a
Person, whether through the ability to exercise voting power, by contract or
otherwise. "Controlling" and "Controlled" have meanings correlative thereto.
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"Debt" means (without duplication), for any Person:
(a) indebtedness of such Person for borrowed money (including
obligations, contingent or otherwise, of such Person relative to the
face amount of all letters of credit, and letters of guaranty, whether
drawn or undrawn, and banker's acceptances issued for the account of
such Person);
(b) obligations of such Person evidenced by bonds,
debentures, notes or similar instruments (but excluding sight drafts
that evidence current account payables arising in the ordinary course
of business which are not more than 90 days past due the original due
date);
(c) obligations of such Person to pay the deferred purchase
price of property or services (but excluding current accounts payable
arising in the ordinary course of business which are not more than 90
days past due the original due date);
(d) indebtedness secured by (or for which the holder of such
indebtedness has an existing right, contingent or otherwise, to be
secured by) a Lien on Property owned or being purchased by such Person
(including indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness shall have
been assumed by such Person or is limited in recourse;
(e) obligations of such Person as lessee under Leases that
shall have been or should be, in accordance with generally accepted
accounting principles, recorded as Capital Leases;
(f) obligations under surety, appeal or custom bonds;
(g) Contingent Liabilities of such Person; and
(h) obligations of such Person under or in connection with a
Sale and Lease-Back Transaction or similar arrangements.
Debt of any Person shall include the Debt of any other entity (including any
partnership in which such Person is a general partner) to the extent such
Person is liable therefor as a result of such Person's ownership interest in or
other relationship with such entity, except to the extent the terms of such
Debt provide that such Person is not liable therefor.
"Debtor Laws" shall mean all applicable liquidation,
conservatorship, bankruptcy, moratorium, arrangement, receivership, insolvency,
reorganization, or similar laws, or general equitable principles from time to
time in effect affecting the rights of creditors generally or providing for the
relief of debtors.
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"Default" shall mean (i) any of the events specified in
Section 11, whether or not there has been satisfied any requirement in
connection with such event for the giving of notice, or the lapse of time, or
the happening of any further condition, event or act or (ii) any "Default" as
defined in any Related Facility.
"Disqualified Capital Stock" means, with respect to any
Person, that portion of any class or series of Capital Stock of such Person
that, by its terms or by the terms of any security into which it is convertible
or exchangeable, is, or upon the happening of an event or passage of time would
be, required to be redeemed or repurchased (including at the option of the
holder), in whole or in part, or has, or upon the happening of an event or
passage of time would have, a redemption sinking fund or similar payment due,
in either case, on or prior to the Maturity Date.
"Dollar Equivalent Value" means with respect to an amount of
any Dollars, an amount of U.S. Dollars into which the Agent determines that it
could, in accordance with its practice from time to time in the interbank
foreign exchange market, convert such amount of Dollars, determined by using
its applicable quoted spot rate on the date on which such equivalent is to be
determined pursuant to the provisions of this Agreement.
"Dollars" and "C$" shall mean lawful currency of Canada.
"Domestic Lending Office" shall mean, with respect to any
Bank, the office of such Bank specified as its "Domestic Lending Office"
opposite its name on Schedule I attached hereto and made a part hereof or such
other office of such Bank as such Bank may from time to time specify to the
Borrower and the Agent.
"EBITDA" means, for any period, as to the Parent and the
Restricted Subsidiaries, an amount equal to earnings before income taxes and
adjustment for extraordinary items, plus (a) on a one time basis, transaction
costs incurred in connection with the Moores Acquisition, not to exceed
U.S.$8,000,000, plus (b) depreciation and amortization, plus (c) interest
expense, plus (or minus) (d) other non-cash charges or income affecting net
earnings (except for those related to extraordinary items), for the four (4)
immediately preceding fiscal quarterly periods; provided, with respect to any
acquisition of an Acquisition Target which results in the requirement to
provide proforma financial information pursuant to Article 11 of Regulation S-X
(Reg Section 210.11.01, .02 and .03), EBITDA of the Acquisition Target for each
full fiscal quarter included in the applicable computation period prior to such
Acquisition (including the fiscal quarter during which it was acquired) shall
be included, provided further that EBITDA of the Acquisition Target shall be
adjusted for those items of income and expense that will increase or decrease
subsequent to the date of Acquisition, such adjustments limited to those
adjustments included in the proforma financial statements provided in the Form
8-K filed with the Securities and Exchange Commission pursuant to Article 11 of
Regulation S-X.
"Eligible Assignee" means (i) a Bank; (ii) a Qualified
Affiliate of a Bank; and (iii) any other Person approved by the Agent and,
unless an Event of Default has occurred and is
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15
continuing at the time any assignment is effected in accordance with Section
13.10, the Borrower, such approval not to be unreasonably withheld or delayed
by the Borrower and such approval to be deemed given by the Borrower if no
objection is received by the assigning Bank and the Agent from the Borrower
within ten (10) Business Days after notice of such proposed assignment has been
provided by the assigning Bank to the Borrower; provided, however, that neither
the Borrower nor an Affiliate of the Borrower shall qualify as an Eligible
Assignee.
"Environmental Lien" means a Lien in favor of a Governmental
Authority or other Person (a) for any liability under any Environmental
Protection Statute or (b) for damages arising from or costs incurred by such
Governmental Authority or other Person in response to a release or threatened
release of Hazardous Materials into the environment.
"Environmental Protection Statute" means (a) the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 (as amended by
the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C.A. Section
9601 et seq.), as amended from time to time, and any and all rules and
regulations issued or promulgated thereunder ("CERCLA"); (b) the Resource
Conservation and Recovery Act (as amended by the Hazardous and Solid Waste
Amendment of 1984, 42 U.S.C.A. Section 6901 et seq.), as amended from time to
time, and any and all rules and regulations promulgated thereunder ("RCRA"); (c)
the Clean Air Act, 42 U.S.C.A. Section 7401 et seq., as amended from time to
time, and any and all rules and regulations promulgated thereunder; (d) the
Clean Water Act of 1977, 33 U.S.C.A. Section 1251 et seq., as amended from time
to time, and any and all rules and regulations promulgated thereunder; (e) the
Toxic Substances Control Act, 15 U.S.C.A. Section 2601 et seq., as amended from
time to time, and any and all rules and regulations promulgated thereunder; or
(f) any other federal or state or provincial law, statute, rule or regulation
enacted in connection with or relating to the protection or regulation of the
environment (including, without limitation, those laws, statutes, rules and
regulations regulating the disposal, removal, production, storing, refining,
handling, transferring, processing or transporting of Hazardous Materials) and
any rules and regulations issued or promulgated in connection with any of the
foregoing by any Governmental Authority, and "Environmental Protection Statutes"
means, collectively, each of the foregoing.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"ERISA Affiliate" means any subsidiary or trade or business
(whether or not incorporated) which is a member of a group of which the Parent
is a member and which is under common control within the meaning of Section 414
of the Code and the rules and regulations thereunder.
"ERISA Event" means any of the following events: (a) a
"Reportable Event" described in Section 4043 of ERISA and the regulations
issued thereunder (other than a "Reportable Event" not subject to the
provisions for the thirty (30)-day notice to the PBGC under such
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regulations), (b) the withdrawal of the Parent from a Plan during a plan year
in which it was a "substantial employer" as defined in Section 4001(a)(2) of
ERISA or the incurrence of liability by the Parent under Section 4064 of ERISA,
(c) the distribution of a notice of intent to terminate a Plan pursuant to
Section 4041(a)(2) of ERISA or the treatment of a Plan amendment as a
termination under Section 4041 of ERISA, (d) the institution of proceedings to
terminate a Plan by the PBGC, or (e) any other event or condition which might
constitute grounds under Section 4042 of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan.
"Eurodollar Lending Office" shall mean, with respect to each
Bank, the office specified as such Bank's "Eurodollar Lending Office" opposite
its name on Schedule 1 attached hereto and made a part hereof (or, if no such
office is specified, its Domestic Lending Office) or such other office of such
Bank as such Bank may from time to time specify to the Borrower and the Agent.
"Eurodollar Loans" means Loans that bear interest at rates
based upon the Adjusted Eurodollar Rate plus the Applicable Margin.
"Eurodollar Rate" means, for any Eurodollar Loan for any
Interest Period therefor, the rate for deposits in Dollars in the approximate
amount of the requested borrowing, conversion or continuation and for a period
comparable to the relevant Interest Period which appears on Telerate Page 3740
as of 11:00 a.m. (London time) two Business Days prior to the first day of such
Interest Period (or, if for any reason such rate is not available, any
replacement page thereof or other applicable display page designated by
Telerate); provided, however, that if Agent determines that the relevant
foregoing source is unavailable for any Interest Period, Eurodollar Rate means
the rate of interest determined by Agent to be the average (rounded upward, if
necessary, to the nearest 1/10,000th of 1%) of the rates per annum at which
deposits in Dollars in immediately available funds are offered to the Agent two
(2) Business Days preceding the first day of the relevant Interest Period by
prime banks in the London interbank eurocurrency market as of 11:00 a.m. London
time for delivery on the first day of such Interest Period, for the number of
days comprised therein and in an amount comparable to the amount of the
relevant Loan.
"Event of Default" shall mean any of the events specified in
Section 11, provided that there has been satisfied any requirement in
connection with such event for the giving of notice, or the lapse of time, or
the happening of any further condition, event or act.
"Exchangeable Shares" shall have the meaning set forth in the
Combination Agreement.
"Expiration Date" shall mean the last day of an Interest
Period.
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17
"Fair Market Value" shall mean (i) with respect to any asset
(other than cash) the price at which a willing buyer would buy and a willing
seller would sell, such asset in an arms' length transaction, and (ii) with
respect to cash, the amount of such cash.
"Fiscal Year" means the Parent's fifty-two (52) or
fifty-three (53) week fiscal year, which ends on the Saturday nearest January
31 in each calendar year; by way of example, references to "Fiscal 1998" shall
mean the fiscal year ended January 30, 1999.
"Fixed Charge Ratio" means, for any period as to the Parent
and the Restricted Subsidiaries, the ratio of (i) EBITDA plus Contractual Rent
Expense minus capital expenditures (excluding Acquisitions) to (ii) Fixed
Charges. For purposes of this definition, capital expenditures shall be
calculated for the four immediately preceding fiscal quarterly periods.
"Fixed Charges" means, for any period as to the Parent and
the Restricted Subsidiaries, and without duplication, an amount equal to the
sum of (a) cash interest expense plus (b) Contractual Rent Expense plus (c)
scheduled payments on Capital Leases plus (d) scheduled principal payments in
respect of any Debt (excluding Lease payments relating to Sale and Lease- Back
Transactions covered by clause (b) or (c) of this definition and excluding
scheduled principal payments on the Debt under the Related Facilities) plus (e)
cash dividends by the Parent; calculated for the four (4) immediately preceding
fiscal quarterly periods.
"Future Plan" has the meaning specified in Section 9.1(h)
hereof.
"GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board, or in such other
statements by such other entity as may be in general use by significant
segments of the accounting profession, which are applicable to the
circumstances as of the date of determination.
"Governmental Approval" means any authorization, consent,
approval, license or exemption of, registration or filing with, or report or
notice to, any Governmental Authority.
"Governmental Authority" means any national, state,
provincial, county, municipal or other government, domestic or foreign, any
agency, board, bureau, commission, court, department or other instrumentality
of any such government, or any arbitrator.
"Governmental Requirement" means any law, statute, code,
ordinance, order, rule, regulation, judgment, decree, injunction, writ, edict,
franchise, permit, certificate, license, award, authorization or other
direction, guideline, or requirement of any Governmental Authority, including,
without limitation, any requirement under common law.
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18
"Hazardous Materials" means (a) any "hazardous waste" as
defined by RCRA; (b) any "hazardous substance" as defined by CERCLA; (c)
asbestos; (d) polychlorinated biphenyls; (e) any substance the presence of
which on any of the Parent's or any Subsidiary's Properties is prohibited by
any Governmental Authority; (f) petroleum, including crude oil and any fraction
thereof, natural gas liquids, liquefied natural gas and synthetic gas useable
for fuel (or mixtures of natural gas and such synthetic gas); (g) drilling
fluids, produced waters and other wastes associated with the exploration,
development or production of crude oil, natural gas or geothermal energy; and
(h) any other substance which, pursuant to any Governmental Requirement,
requires special handling in its collection, storage, treatment or disposal.
"Highest Lawful Rate" shall mean, with respect to each Bank,
the maximum non-usurious interest rate, if any, that at any time or from time
to time may be contracted for, taken, reserved, charged, or received with
respect to the Notes or on other amounts, if any, due to such Bank pursuant to
this Agreement or any other Loan Document, under laws applicable to such Bank
which are presently in effect, or, to the extent allowed by law, under such
applicable laws which may hereafter be in effect and which allow a higher
maximum non-usurious interest rate than applicable laws now allow. To the
extent required by applicable law in determining the Highest Lawful Rate with
respect to any Bank as of any date, there shall be taken into account the
aggregate amount of all payments and charges theretofore charged, reserved or
received by such Bank hereunder or under the other Loan Documents which
constitute or are deemed to constitute interest under applicable law.
"Intercompany Credit Agreements" shall mean, collectively,
(i) that certain Credit Agreement dated as of February 10, 1999, between the
Borrower and Xxxxxx Retail Group Inc. and the term note in the amount of
C$75,000,000 issued thereunder, (ii) the term notes dated as of February 10,
1999 issued by Golden Brand Clothing (Canada) Ltd. and Xxxxxx The Suit People
Inc. to Xxxxxx Retail Group Inc. in the respective amounts of C$50,000,000 and
C$25,000,000, and (iii) the revolving notes dated as of February 10, 1999
issued by Golden Brand Clothing (Canada) Ltd. and Xxxxxx The Suit People Inc.,
respectively, to Xxxxxx Retail Group Inc., in the maximum aggregate principal
amount of C$30,000,000; as each may be amended, modified or supplemented from
time to time in accordance with the terms hereof.
"Interest Payment Date" shall mean (a) as to any Canadian
Prime Rate Loan, the last day of each 30-day period during which any such Loan
is outstanding (or if any such date is not a Business Day, then the next
preceding Business Day); (b) as to any Eurodollar Loan in which the Interest
Period with respect thereto is not greater than three (3) months, the date on
which such Interest Period ends; (c) as to any Eurodollar Loan in which the
Interest Period with respect thereto is greater than three (3) months, the date
on which the third month of such Interest Period ends, and the date on which
each such Interest Period ends; and (d) as to all Loans, at maturity.
"Interest Period" shall mean the period of time for which the
Eurodollar Rate shall be in effect as to any Eurodollar Loan which shall be a
1, 2, 3 or 6 month period of time, commencing with the Borrowing Date or the
Expiration Date of the immediately preceding Interest
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Period, as the case may be, applicable to and ending on the effective date of
any rate change or rate continuation made as provided in Section 3.1(a) as the
Borrower may specify in the Notice of Borrowing or the Notice of Rate
Change/Continuation, subject, however, to the early termination provisions of
Article III relating to any Eurodollar Loan; provided, however, that: (i) any
Interest Period which would otherwise end on a day which is not a Business Day
shall be extended to the next succeeding Business Day unless such Business Day
falls in another calendar month, in which case such Interest Period shall end
on the next preceding Business Day, (ii) the duration of any Interest Period
which commences before any principal repayment installment date and otherwise
ends after such date shall end on such date, and (iii) no Interest Period shall
extend beyond the Maturity Date.
"Inventory" means the "inventory" (as that term is defined by
and within the meaning of GAAP) of the Parent and any Restricted Subsidiary
including, without limitation, merchandise in transit and piece goods in the
possession of manufacturers.
"Investment" of any Person means any investment so classified
under GAAP, and, whether or not so classified, includes (a) any direct or
indirect loan or advance made by it to any other Person, whether by means of
stock purchase, loan, advance or otherwise, (b) any capital contribution to any
other Person, and (c) any ownership or similar interest in any other Person.
"Law" means any federal, state, provincial or local law,
statute, ordinance, code, rule, regulation, license, permit, authorization,
decision, order, injunction or decree, domestic or foreign.
"Lease" means, as to any Person, any operating lease other
than a Capital Lease of any Property (whether real, personal or mixed) by that
Person as a lessee, together with all renewals, extensions and options thereon.
"Lien" means, with respect to any asset, (a) any mortgage,
deed of trust, lien, pledge, hypothecation, encumbrance, charge or security
interest in, on or of such asset, (b) the interest of a vendor or a lessor
under any conditional sale agreement, capital lease or title retention
agreement (or any financing lease having substantially the same economic effect
as any of the foregoing) relating to such asset and (c) in the case of
securities, any purchase option, call, or similar right of a third party with
respect to such securities.
"Loan" or "Loans" shall mean a Loan or Loans, respectively,
as the case may be, from the Banks to the Borrower made under this Agreement.
"Loan Documents" shall mean this Agreement, the Notes, the
Parent Guaranty, the Affiliate Guaranty, the Pledge Agreement and all
instruments, certificates and agreements now or hereafter executed or delivered
to the Agent, the Issuing Bank, or any Bank pursuant to any of the foregoing
and the transactions connected therewith, and all amendments, modifications,
renewals, extensions, increases and rearrangements of, and substitutions for,
any of the foregoing.
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20
"Majority Banks" shall mean at any time Banks holding at
least 66 2/3% of the aggregate unpaid principal amounts outstanding under the
Notes held by the Banks, or, if no such amounts are outstanding, Banks having
at least 66 2/3% of the Commitments.
"Margin Stock" shall have the meaning assigned to such term
in Regulation U.
"Material Adverse Effect" means any material adverse effect
on (a) the financial condition, business, properties or operations of the
Parent and its Restricted Subsidiaries, taken as a whole or (b) the ability of
the Parent, the Borrower or any Restricted Subsidiary to perform its respective
obligations under this Agreement, any Note or any other Loan Document to which
it is a party on a timely basis.
"Maturity Date" shall mean February 5, 2004.
"Moores Acquisition" means the consummation of the
transactions contemplated by the Combination Agreement, including without
limitation the acquisition by the Parent (directly or indirectly) of all the
outstanding Capital Stock (excluding the Exchangeable Shares) of Xxxxxx Retail
Group Inc.
"Multiemployer Plan" means a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA to which the Parent or any ERISA Affiliate is
making or accruing or has made or accrued an obligation to make contributions.
"Multiple Employer Plan" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, which (i) is maintained for employees
of the Parent or an ERISA Affiliate and at least one entity other than the
Parent or an ERISA Affiliate or (ii) was so maintained and in respect of which
the Parent or an ERISA Affiliate could have liability under Section 4064 or
4069 of ERISA in the event such plan has been or were to be terminated.
"Non-Guaranteeing Restricted Subsidiary" shall have the
meaning set forth in Section 9.7.
"Note" or "Notes" shall have the meaning set forth in Section
2.1(c) hereof.
"Notice of Borrowing" shall have the meaning set forth in
Section 2.2(a) hereof.
"Notice of Rate Change/Continuation" shall have the meaning
set forth in Section 3.1(a)(ii).
"Obligations" means all of the obligations of the Parent, the
Borrower and each Subsidiary now or hereafter existing under the Loan
Documents, whether for principal, interest, fees, expenses, indemnification or
otherwise.
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"Officer's Certificate" shall mean a certificate signed in
the name of the Borrower by a Responsible Officer.
"Other Taxes" shall have the meaning set forth in Section
4.6(b).
"Overnight Rate" means, as to Dollars, for any day, the rate
of interest per annum at which overnight deposits in Dollars, in an amount
approximately equal to the amount with respect to which such rate is being
determined, would be offered for such day by the Agent to major banks in the
applicable offshore interbank market.
"Parent" shall have the meaning set forth in the preamble
hereto.
"Parent Guaranty" means that certain Guaranty Agreement of
even date herewith executed and delivered by the Parent, as amended from time
to time.
"PBGC" means the Pension Benefit Guaranty Corporation.
"PBGC Plan" means any Plan subject to Title IV of ERISA or
Section 412 of the Code.
"Permitted Debt" shall have the meaning set forth in Section
10.2 hereof.
"Permitted Liens" means:
(a) Liens for current taxes, assessments or other
governmental charges which are not delinquent or remain payable
without any penalty, or the validity or amount of which is contested
in good faith by appropriate proceedings; provided however, that any
right to seizure, levy, attachment, sequestration, foreclosure or
garnishment with respect to Property of the Parent or any Subsidiary
by reason of such Lien has not matured, or has been and continues to
be effectively enjoined or stayed;
(b) nonconsensual Liens imposed by operation of law,
including, without limitation, landlord Liens (including consensual
landlord Liens) for rent not yet due and payable, and Liens for
materialmen, mechanics, warehousemen, carriers, employees, workmen,
repairmen, current wages or accounts payable not yet delinquent and
arising in the ordinary course of business; provided, however, that
any right to seizure, levy, attachment, sequestration, foreclosure or
garnishment with respect to Property of the Parent or any Subsidiary
by reason of such Lien has not matured, or has been, and continues to
be, effectively enjoined or stayed;
(c) easements, rights-of-way, restrictions and other similar
Liens or imperfections to title which do not materially interfere with
the occupation, use and enjoyment by the
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Parent or any Subsidiary of the Property encumbered thereby or
materially impair the value of such Property subject thereto;
(d) Liens (other than any Lien imposed by ERISA) incurred or
deposits made in the ordinary course of business (i) in connection
with workers' compensation, unemployment insurance and other types of
social security, or (ii) to secure (or to obtain letters of credit
that secure) the performance of tenders, statutory obligations, surety
and appeal bonds, bids, leases, performance or payment bonds,
purchase, construction or sales contracts and other similar
obligations, in each case not incurred or made in connection with the
borrowing of money, the obtaining of advances or credit or the payment
of the deferred purchase price of property;
(e) Liens arising out of or in connection with any litigation
or other legal proceeding which is being contested in good faith by
appropriate proceedings; provided however, that any right to seizure,
levy, attachment, sequestration, foreclosure or garnishment with
respect to Property of the Parent or any Subsidiary by reason of such
Lien has not matured or has been, and continues to be, effectively
enjoined or stayed; and
(f) UCC protective filings with respect to personal property
leased to the Parent or any Subsidiary.
"Person" shall mean an individual, partnership, joint
venture, corporation, joint stock company, bank, trust, unincorporated
organization and/or a government or any department or agency thereof.
"Plan" means any employee benefit plan within the meaning of
Section 3(3) of ERISA, other than a Multiemployer Plan, maintained by the
Parent or any ERISA Affiliate.
"Pledge Agreement" means that certain Pledge and Security
Agreement of even date herewith executed and delivered by the Pledgors, as
amended from time to time.
"Pledgors" means Golden Xxxxxx Company and the Borrower.
"Preferred Stock" means any class or series of Capital Stock
of a Person which is entitled to a preference or priority over any other class
or series of Capital Stock of such Person with respect to any distribution of
such Person's assets, whether with respect to dividends, or upon liquidation or
dissolution, or both.
"Property" or Properties" shall mean any interest or right in
any kind of property or assets, whether real, personal, or mixed, owned or
leased, tangible or intangible, and whether now held or hereafter acquired.
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23
"Pro Rata Percentage" shall mean with respect to any Bank, a
fraction (expressed as a percentage), the numerator of which shall be the
amount of such Bank's Commitment and the denominator of which shall be the
aggregate amount of all the Commitments of the Banks, as adjusted from time to
time in accordance with Section 4.7.
"Qualified Affiliate" means, as to any Bank, any Affiliate
that is wholly-owned direct or indirect subsidiary of such Bank or of any
Person that wholly owns, directly or indirectly, such Bank, subject to the
following additional conditions:
(a) any right of such Bank assignor and such
assignee to vote as a Bank, or any other direct claims or
rights against any other Persons, shall be uniformly
exercised or pursued in the manner that such Bank assignor
would have so exercised such vote, claim or right if it had
not made such assignment or transfer;
(b) such assignee shall not be entitled to (i)
payment under Sections 2.8, 3.3 or 4.6 of amounts in excess
of those payable to such Bank assignor under such section
(determined without regard to such assignment or transfer) or
(ii) give notice under Section 3.2(b) or 3.2(c), other than
when such Bank assignor could have done so under such section
(determined without regard to such assignment or transfer);
and
(c) such assignee may become primarily liable for
such Commitment, but such assignment or transfer shall not
relieve or release the assignor Bank from such Commitment.
"Register" shall have the meaning set forth in Section
13.10(b).
"Related Facilities" means, collectively, (i) the U.S.
Revolving Credit Agreement, and (ii) the Canadian Revolving Credit Agreement.
"Reserve Requirement" means, at any time, the maximum rate at
which reserves (including, without limitation, any marginal, special,
supplemental, or emergency reserves) are required to be maintained under
regulations issued from time to time by the Board of Governors of the Federal
Reserve System (or any successor) by member banks of the Federal Reserve System
against "Eurocurrency liabilities" (as such term is used in Regulation D).
Without limiting the effect of the foregoing, the Reserve Requirement shall
reflect any other reserves required to be maintained by such member banks with
respect to (i) any category of liabilities which includes deposits by reference
to which the Adjusted Eurodollar Rate is to be determined, or (ii) any category
of extensions of credit or other assets which include Eurodollar Loans. The
Adjusted Eurodollar Rate shall be adjusted automatically on and as of the
effective date of any change in the Reserve Requirement.
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"Responsible Officer" means, as to any Person, the Chairman
of the Board, President, Vice President-Finance or the Treasurer of such
Person.
"Restricted Investments" shall have the meaning set forth in
Section 10.5.
"Restricted Payments" shall have the meaning set forth in
Section 10.3.
"Restricted Subsidiary" shall mean the Subsidiaries
designated as Restricted Subsidiaries on Schedule 7.17 attached hereto,
together with any Subsidiary hereafter created or acquired and, at the time of
creation or acquisition, not designated by the Board of Directors of the Parent
as an Unrestricted Subsidiary. Any Subsidiary designated as an Unrestricted
Subsidiary for purposes of this Agreement may thereafter be designated as a
Restricted Subsidiary (upon approval by the Board of Directors of the Parent)
upon 30 days' prior written notice to the Agent if, at the time of such
designation and after giving effect thereto and after giving effect to the
concurrent retirement of any Debt, (i) no Event of Default or Default shall
have occurred and be continuing, (ii) such Subsidiary is organized under the
laws of Canada, the United Kingdom or the United States or any state thereof,
(iii) (except for directors' qualifying shares and the Exchangeable Shares)
100% of each class of voting stock or other equity interests outstanding of
such Subsidiary is owned by the Parent or a wholly-owned Restricted Subsidiary
and (iv) the Parent and such Subsidiary shall have complied with Section 9.7.
Except for directors' qualifying shares and the Exchangeable Shares, each
Restricted Subsidiary shall be directly or indirectly wholly-owned by the
Parent. Any designation that fails to comply with the terms of this definition
shall be null and void and of no effect whatsoever. At all times during the
term of this Agreement the Borrower and each Subsidiary thereof shall be a
Restricted Subsidiary.
"Sale and Lease-Back Transaction" of any Person means any
arrangement entered into by such Person or any Subsidiary of such Person,
directly or indirectly, whereby such Person or any Subsidiary of such Person
shall sell or transfer any property, whether now owned or hereafter acquired,
and whereby such Person or any Subsidiary of such Person shall then or
thereafter rent or lease as lessee such property or any part thereof or other
property which such Person or any Subsidiary of such Person intends to use for
substantially the same purpose or purposes as the property sold or transferred.
"Securities Act" shall have the meaning set forth in Section
13.1.
"Similar Businesses" shall have the meaning set forth in
Section 7.18.
"Subscription Agreement" means that certain Subscription
Agreement dated as of February 10, 1999 between Xxxxxx Retail Group Inc. and
the Borrower as amended, modified or supplemented from time to time in
accordance with the terms hereof.
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"Subsidiary" means, with respect to any Person (the "parent")
at any date, any corporation, limited liability company, partnership,
association or other entity the accounts of which would be consolidated with
those of the parent in the parent's consolidated financial statements if such
financial statements were prepared in accordance with GAAP as of such date, as
well as any other corporation, limited liability company, partnership,
association or other entity (a) of which securities or other ownership
interests representing more than 50% of the equity or more than 50% of the
ordinary voting power or, in the case of a partnership, more than 50% of the
general partnership interests are, as of such date, owned, controlled or held,
or (b) that is, as of such date, otherwise Controlled, by the parent or one or
more subsidiaries of the parent or by the parent and one or more subsidiaries
of the parent.
"Taxes" shall have the meaning set forth in Section 4.6(a).
"Termination Date" means the date of the acceleration of
repayment of the Loans pursuant to Section 11 hereof.
"Total Funded Debt" means, at any time as to the Parent and
the Restricted Subsidiaries, and without duplication, an amount equal to the
sum of (a) the aggregate principal amount of all Loans outstanding on such date
plus (b) the aggregate principal amount of drawings under Letters of Credit
issued under the Related Facilities which have not then been reimbursed
pursuant to Section 2.6 thereof plus (c) the aggregate principal amount of all
other outstanding Debt of the Borrower and the Restricted Subsidiaries of the
type described in clauses (a)-(e) of the definition of "Debt" (excluding any
undrawn amounts under outstanding letters of credit).
"Type" shall mean, with respect to any Loan, any Canadian
Prime Rate Loan or any Eurodollar Loan.
"Unrestricted Subsidiary" shall mean each Subsidiary
designated as an Unrestricted Subsidiary on Schedule 7.17 attached hereto,
together with any Subsidiary which is hereafter designated by the Board of
Directors of the Parent as an Unrestricted Subsidiary, and in each case and
without further action or qualification, any Subsidiary of such Subsidiary so
designated as an Unrestricted Subsidiary. Any Subsidiary may be designated an
Unrestricted Subsidiary (upon approval by the Board of Directors of the Parent)
upon 30 days' prior written notice to the Agent if, at the time of such
designation and after giving effect thereto and after giving effect to the
concurrent retirement of any Debt, (i) no Event of Default or Default shall
have occurred and be continuing, (ii) such Subsidiary does not own, directly or
indirectly, any Debt or capital stock of, or other equity interest in, the
Parent or a Restricted Subsidiary, (iii) such Subsidiary does not own or hold
any Lien on any property of the Parent or any Restricted Subsidiary and (iv)
such Subsidiary is not liable, directly or indirectly, with respect to any Debt
other than Unrestricted Subsidiary Indebtedness.
"Unrestricted Subsidiary Indebtedness" of any Person means
Debt of such Person (a) as to which neither the Parent nor any Restricted
Subsidiary is directly or indirectly liable (by
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virtue of the Parent's or such Restricted Subsidiary's being the primary
obligor, or guarantor of, or otherwise contractually liable in any respect on,
such Debt), (b) which, upon the occurrence of a default with respect thereto,
does not result in, or permit any holder of any Debt of the Parent or any
Restricted Subsidiary to declare, a default on such Debt of the Parent or any
Restricted Subsidiary and (c) which is not secured by any assets of the Parent
or of any Restricted Subsidiary.
"U.S. Dollar" and "U.S. $" shall mean lawful currency of the
United States of
America.
"U.S. Revolving Credit Agreement" means that certain
Revolving Credit Agreement of even date herewith among Parent, NationsBank,
N.A. as Agent, and the other parties thereto, as amended from time to time.
2. THE LOANS.
2.1. LOANS.
(a) Upon the terms and conditions and relying upon the
representations and warranties herein set forth, each Bank which is a party
hereto on the Closing Date severally agrees to make a Loan to the Borrower
denominated in Dollars on the Closing Date up to an aggregate principal amount
of Loans not exceeding at any one time outstanding the amount set opposite such
Bank's name on the signature pages hereof as such Bank's Commitment (such
amount being such Bank's "Commitment"). Amounts borrowed hereunder and repaid
or prepaid may not be reborrowed.
(b) Principal of the Loans outstanding on such date (if any)
shall be due and payable, together with accrued and unpaid interest thereon, in
equal quarterly installments of C$937,500, commencing on May 1, 1999, with each
subsequent installment due on the last day of each fiscal quarter, until the
Maturity Date, or if earlier, the Termination Date. On the Maturity Date, or if
earlier, the Termination Date, all remaining principal of the Loans outstanding
shall be due and payable, together with all accrued and unpaid interest
thereon.
(c) The Borrower shall execute and deliver to the Agent for
each Bank to evidence the Loan made by each Bank, a promissory note (each, as
the same may be amended, modified or extended from time to time, a "Note"),
which shall be (i) dated the Closing Date; (ii) in the principal amount of such
Bank's Commitment; and (iii) in substantially the form attached hereto as
Exhibit A, with the blanks appropriately filled. The outstanding principal
balance of each Note shall be payable on the Maturity Date. Each Note shall
bear interest on the unpaid principal amount thereof from time to time
outstanding at the rate per annum determined as specified in Section 3, payable
on each Interest Payment Date and at maturity, commencing with the first
Interest Payment Date following the date of such Note.
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(d) The Agent shall promptly notify each Bank which is a
party hereto on the Closing Date of the applicable interest rate under Section
3.1. In the case of all borrowings, each Bank shall, before 11:00 (Dallas time)
on the Closing Date, make available for the account of its Applicable Lending
Office to the Agent at the Agent's Domestic Lending Office, in immediately
available funds, its Pro Rata Percentage of such borrowing. After the Agent's
receipt of such funds and upon fulfillment of the applicable conditions set
forth in Section 8, on the Closing Date the Agent shall make the borrowing
available to the Borrower at its Domestic Lending Office in immediately
available funds. Each Bank may, at its option, post on a schedule attached to
its Note (x) the date and principal amount of each Loan made under such Note;
(y) the rate of interest each such Loan will bear; and (z) each payment of
principal thereon; provided, however, that any failure of such Bank to so xxxx
such Note shall not affect the Borrower's obligations thereunder; and provided
further that such Bank's records as to such matters shall be controlling,
absent manifest error, whether or not such Bank has so marked such Note. Any
deposit to the Borrower's demand deposit account by the Agent pursuant to a
request (whether written or oral) believed by the Agent to be an authorized
request by the Borrower for a Loan hereunder shall be deemed to be a Loan
hereunder for all purposes with the same effect as if the Borrower had in fact
requested the Agent to make such Loan.
2.2. BORROWING PROCEDURE.
(a) The borrowing by the Borrower hereunder shall be by way
of a single borrowing of C$75,000,000 on the Closing Date. Such borrowing shall
be made upon prior written notice from the Borrower to the Agent in the form of
Exhibit B hereto (the "Notice of Borrowing") delivered to the Agent not later
than 10:00 a.m. (Dallas time) at least three Business Day prior to the Closing
Date. The Notice of Borrowing shall be irrevocable and shall specify (i) the
amount of the proposed borrowing and of each Loan comprising a part thereof
(which shall be in an aggregate amount of not less than C$3,000,000 or an
integral multiple of C$1,000,000 in excess thereof); (ii) the Borrowing Date
(which shall be the Closing Date); (iii) the Interest Period with respect to
each such Loan and the Expiration Date of each such Interest Period (provided,
that there shall not be more than seven (7) Interest Periods in effect at any
one time under this Agreement); and (iv) the demand deposit account of the
Borrower at the Agent's Domestic Lending Office with which the proceeds of the
borrowing are to be deposited. Promptly upon its receipt of the Notice of
Borrowing, the Agent shall deliver by telefacsimile a copy thereof to each
Bank. The Borrower may give the Agent telephonic notice by the required time of
the proposed borrowing under this Section 2.2(a); provided, that such
telephonic notice shall be promptly confirmed in writing by delivery to the
Agent of a Notice of Borrowing. Neither the Agent nor any Bank shall incur any
liability to the Borrower in acting upon any telephonic notice referred to
above which the Agent believes in good faith to have been given by the Borrower
or for otherwise acting in good faith under this Section 2.2(a).
(b) Unless the Agent shall have received notice from a Bank
(which must be received at least one Business Day prior to the date of any
borrowing) that such Bank will not make available to the Agent such Bank's Pro
Rata Percentage of such borrowing as and when required
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hereunder, the Agent may assume that such Bank has made such portion available
to the Agent on the date of such borrowing in accordance with Section 2.1(c),
and the Agent may (but shall not be so required), in reliance upon such
assumption, make available to the Borrower on such date a corresponding amount.
The Agent shall give notice to the Borrower of any notice the Agent receives
under this Section 2.2(b), provided that the Agent shall not be liable for the
failure to give such notice. If and to the extent any Bank shall not have made
its full amount available to the Agent in immediately available funds and the
Agent in such circumstances has made available to the Borrower such amount,
that Bank shall on the Business Day following such Borrowing Date make such
amount available to the Agent, together with interest at the Overnight Rate for
each day during such period. A notice of the Agent submitted to any Bank with
respect to amounts owing under this subsection (b) shall be conclusive, absent
manifest error. If such amount is so made available, such payment to the Agent
shall constitute such Bank's Loan on the date of borrowing for all purposes of
this Agreement. If such amount is not made available to the Agent on the
Business Day following the borrowing date, the Agent will notify the Borrower
by the next succeeding Business Day of such failure to fund and, upon demand by
the Agent, the Borrower shall pay such amount to the Agent for the Agent's
account, together with interest thereon for each day elapsed since the date of
such borrowing, at a rate per annum equal to the interest rate applicable at
the time to the Loans comprising such borrowing.
(c) The failure of any Bank to make the Loan to be made by it
as part of any borrowing shall not relieve any other Bank of its obligation, if
any, hereunder to make its Loan on the date of such borrowing, but no Bank
shall be responsible for the failure of any other Bank to make the Loan to be
made by such other Bank on the date of any borrowing.
3. INTEREST RATE PROVISIONS.
3.1. INTEREST RATE DETERMINATION.
(a) Except as specified in Sections 3.2, 3.3, 3.4, 3.5 and
3.6, the Loans shall bear interest on the unpaid principal amount thereof from
time to time outstanding, until maturity, at a rate per annum (calculated based
on a year of 360 days in the case of the Eurodollar Rate, and a year of 365 or
366 days, as the case may be, in the case of the Canadian Prime Rate, in each
case for the actual days elapsed) as follows:
(i) The principal balance of the Loans from time to
time outstanding shall bear interest at an annual rate equal
to:
(A) with respect to any Eurodollar Loan,
the lesser of, (y) the Adjusted Eurodollar Rate plus
the Applicable Margin, with respect thereto or (z)
the Highest Lawful Rate, from the first day to, but
not including, the Expiration Date of the Interest
Period then in effect with respect thereto;
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(B) with respect to any Canadian Prime Rate
Loan, the lesser of (y) the Canadian Prime Rate or
(z) the Highest Lawful Rate, from the first day to,
but not including, the earlier of the Maturity Date
or conversion to another Type of Loan;
(ii) (A) The Borrower may, upon irrevocable written
notice to the Agent in accordance with Section 3.1(a)(ii)(B),
elect to continue (for the same or different Interest
Period), as of the last day of the applicable Interest
Period, any Eurodollar Loans having Interest Periods expiring
on such day (or any part thereof not less than C$3,000,000 or
that is in an integral multiple of C$1,000,000 in excess
thereof).
(B) To convert or continue a Loan as
provided in Section 3.1(a)(ii) the Borrower shall
deliver a Notice of Rate Change/Continuation in the
form of Exhibit D hereto (a "Notice of Rate
Change/Continuation"), to be received by the Agent
not later than 11:00 a.m. (Dallas time) at least
four Business Days in advance of the
Change/Continuation Date, specifying:
(i) the date on which such Loan was
made;
(ii) the interest rate then
applicable to such Loan;
(iii) the Interest Period then
applicable to such Loan;
(iv) the proposed
Change/Continuation Date;
(v) the aggregate amount in Dollars
of Loans to be converted or continued;
(vi) the duration of the requested
Interest Period.
(C) If upon the expiration of any Interest
Period, the Borrower has failed to select a new
Interest Period to be applicable to such Eurodollar
Loans prior to the fourth Business Day in advance of
the expiration date of the current Interest Period
applicable thereto as provided in Section
3.1(a)(ii), or if any Default or Event of Default
then exists, the Borrower shall be deemed to have
elected to convert such Eurodollar Loans into
Canadian Prime Rate Loans effective as of the
expiration date of such Interest Period, and all
conditions to such conversion shall be deemed to
have been satisfied.
(D) The Agent will promptly notify each
Bank of its receipt of a Notice of Rate
Change/Continuation, or, if no timely notice is
provided by the Borrower, the Agent will promptly
notify each Bank of the details of any
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automatic conversion. All conversions and
continuations shall be made ratably according to the
respective outstanding principal amounts of the
Loans with respect to which the notice was given
held by each Bank.
(E) During the existence of a Default or
Event of Default, the Borrower may not elect to have
a Loan converted into or continued as an Eurodollar
Loan.
(iii) Nothing contained herein shall authorize the
Borrower (A) to convert any Loan into or continue any Loan as
a Eurodollar Loan unless the Expiration Date of the Interest
Period for such Loan occurs on or before the Maturity Date or
(B) to continue or change the interest rates applicable to
any Eurodollar Loan prior to the Expiration Date of the
Interest Period with respect thereto.
(iv) Notwithstanding anything set forth herein to
the contrary (other than Section 13.11), if a Default has
occurred and is continuing, and upon written notice to the
Borrower from the Agent, each outstanding Loan shall bear
interest at a rate per annum which shall be equal to the
lesser of (x) 2% above the interest rate otherwise applicable
thereto or (y) the Highest Lawful Rate, which interest shall
be due and payable on demand.
(b) The Canadian Prime Rate for each Canadian Prime Rate Loan
shall be determined by the Agent on the first day of each 30-day period such
Canadian Prime Rate Loan shall be outstanding, or if such day is not a Business
Day, on the next succeeding Business Day. The Eurodollar Rate for the Interest
Period for each Eurodollar Loan shall be determined by the Agent two (2)
Business Days before the first day of such Interest Period.
(c) Each determination of an applicable interest rate by the
Agent shall be conclusive and binding upon the Borrower and the Banks in the
absence of manifest error.
3.2. UTILIZATION OF COMMITMENTS IN DOLLARS.
(a) In the case of a proposed continuation of Loans for an
additional Interest Period pursuant to Section 3.1, the Banks shall be under no
obligation to continue such Loans if the Agent has received notice from any of
the Banks by 5:00 p.m. (Dallas time) three Business Days prior to the day of
such continuation that such Bank cannot continue to provide Eurodollar Loans
denominated in Dollars, in which event the Agent will give notice to the
Borrower not later than 9:00 a.m. (Dallas time) on the second Business Day
prior to the requested date of such continuation that the continuation of such
Eurodollar Loans is not then available, and notice thereof also will be given
promptly by the Agent to the Banks. If the Agent shall have so notified the
Borrower that any such continuation of Eurodollar Loans is not then available,
any Notice of Rate Change/Continuation with respect thereto shall be deemed
withdrawn and such Eurodollar Loans shall be automatically
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converted into Canadian Prime Rate Loans with effect from the last day of the
applicable Interest Period with respect to such Eurodollar Loans, and all
conditions to such conversion shall be deemed to have been satisfied. The Agent
will promptly notify the Borrower and the Banks of any such automatic
conversion.
(b) Notwithstanding anything herein to the contrary, during
the existence of a Default or an Event of Default, upon the request of the
Majority Banks, all or any part of any outstanding Eurodollar Loans shall be
redenominated and converted into Canadian Prime Rate Loans with effect from the
last day of the Interest Period with respect to such Eurodollar Loans, and all
conditions to such conversion shall be deemed to have been satisfied. The Agent
will promptly notify the Borrower of any such redenomination and conversion
request.
3.3. INCREASED COST AND REDUCED RETURN.
(a) If, after the date hereof, the adoption of any applicable
law, rule, or regulation, or any change in any applicable law, rule, or
regulation, or any change in the interpretation or administration thereof by
any governmental authority, central bank, or comparable agency charged with the
interpretation or administration thereof, or compliance by any Bank (or its
Applicable Lending Office) with any request or directive (whether or not having
the force of law) of any such governmental authority, central bank, or
comparable agency:
(i) shall subject such Bank (or its Applicable Lending
Office) to any tax, duty, or other charge with respect to any Loans,
its Note, or its obligation to make Loans, or change the basis of
taxation of any amounts payable to such Bank (or its Applicable
Lending Office) under this Agreement or its Note (other than taxes
imposed on the overall net income or capital of such Bank by the
jurisdiction in which such Bank has its principal office or such
Applicable Lending Office);
(ii) shall impose, modify, or deem applicable any reserve,
special deposit, assessment, or similar requirement (other than the
Reserve Requirement utilized in the determination of the Adjusted
Eurodollar Rate) relating to any extensions of credit or other assets
of, or any deposits with or other liabilities or commitments of, such
Bank (or its Applicable Lending Office), including the Commitment of
such Bank hereunder; or
(iii) shall impose on such Bank (or its Applicable Lending
Office) or on the Canadian or United States market for certificates of
deposit or the London interbank market any other condition affecting
this Agreement or its Note or any of such extensions of credit or
liabilities or commitments;
and the result of any of the foregoing is to increase the cost to such Bank (or
its Applicable Lending Office) of making, converting into, continuing, or
maintaining any Eurodollar Loans or to reduce any sum received or receivable by
such Bank (or its Applicable Lending Office) under this
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Agreement or its Note with respect to any Eurodollar Loans, in each case by an
amount deemed material by such Bank, then the Borrower shall pay to such Bank
such amount or amounts as will compensate such Bank for such increased cost or
reduction, provided, that the Borrower will not be responsible for paying any
amounts pursuant to this Section 3.3 accruing for a period greater than 180
days prior to the date that such Bank notifies the Borrower of the
circumstances giving rise to such increased costs or reductions and of such
Bank's intention to claim compensation therefor; provided further that, if the
circumstances giving rise to such increased costs or reductions is retroactive,
then the 180-day period referred to above shall be extended to include the
period of retroactive effect thereof. If any Bank requests compensation by the
Borrower under this Section 3.3(a), the Borrower may, by notice to such Bank
(with a copy to the Agent), suspend the obligation of such Bank to make or
continue Loans of the Type with respect to which such compensation is
requested, or to convert Loans of any other Type into Loans of such Type, until
the event or condition giving rise to such request ceases to be in effect (in
which case the provisions of Section 3.6 shall be applicable); provided that
such suspension shall not affect the right of such Bank to receive the
compensation so requested.
(b) If, after the date hereof, any Bank shall have determined
that the adoption of any applicable law, rule, or regulation regarding capital
adequacy or any change therein or in the interpretation or administration
thereof by any governmental authority, central bank, or comparable agency
charged with the interpretation or administration thereof, or any request or
directive regarding capital adequacy (whether or not having the force of law)
of any such governmental authority, central bank, or comparable agency, has or
would have the effect of reducing the rate of return on the capital of such
Bank or any corporation controlling such Bank as a consequence of such Bank's
obligations hereunder to a level below that which such Bank or such corporation
could have achieved but for such adoption, change, request, or directive
(taking into consideration its policies with respect to capital adequacy), then
from time to time the Borrower shall pay to such Bank such additional amount or
amounts as will compensate such Bank for such reduction, provided, that the
Borrower will not be responsible for paying any amounts pursuant to this
Section 3.3 accruing for a period greater than 180 days prior to the date that
such Bank notifies the Borrower of the circumstances giving rise to such
increased costs or reductions and of such Bank's intention to claim
compensation therefor; provided further that, if the circumstances giving rise
to such increased costs or reductions is retroactive, then the 180-day period
referred to above shall be extended to include the period of retroactive effect
thereof.
(c) Each Bank shall promptly notify the Borrower and the
Agent of any event of which it has knowledge, occurring after the date hereof,
which will entitle such Bank to compensation pursuant to this Section and will
use reasonable efforts to designate a different Applicable Lending Office if
such designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the judgment of such Bank, be otherwise
disadvantageous to it. The Borrower hereby agrees to pay all reasonable costs
and expenses incurred by any Bank in connection with any such designation. Any
Bank claiming compensation under this Section shall do so in good faith on a
nondiscriminatory basis. In determining such amount, such Bank may use any
reasonable
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averaging and attribution methods. A certificate of a Bank setting forth in
reasonable detail such amount or amounts as shall be necessary to compensate
such Bank as specified in this Section 3.3 may be delivered to the Borrower and
the Agent and shall be conclusive absent manifest error. The Borrower shall pay
to the Agent for the account of such Bank the amount shown as due on any such
certificate within fifteen (15) days after its receipt of the same.
3.4. LIMITATION ON TYPES OF LOANS. If on or prior to the
first day of any Interest Period for any Eurodollar Loan:
(a) the Agent determines (which determination shall be
conclusive) that by reason of circumstances affecting the relevant
market, adequate and reasonable means do not exist for ascertaining
the Eurodollar Rate for such Interest Period; or
(b) the Majority Banks determine (which determination shall
be conclusive) and notify the Agent that the Adjusted Eurodollar Rate
plus the Applicable Margin will not adequately and fairly reflect the
cost to the Banks of funding Eurodollar Loans for such Interest
Period;
then the Agent shall give the Borrower prompt notice thereof specifying the
relevant Type of Loans and the relevant amounts or periods, and so long as such
condition remains in effect, the Banks shall be under no obligation to make
additional Loans of such Type, continue Loans of such Type, or to convert Loans
of any other Type into Loans of such Type and the Borrower shall, on the last
day(s) of the then current Interest Period(s) for the outstanding Loans of the
affected Type, either prepay such Loans or convert such Loans into another Type
of Loan in accordance with the terms of this Agreement. Each Bank will use
reasonable efforts to designate a different Applicable Lending Office if such
designation will avoid the effects of this Section 3.4 and will not, in the
judgment of such Bank, be otherwise disadvantageous to it. The Borrower hereby
agrees to pay all reasonable costs and expenses incurred by any Bank in
connection with any such designation.
3.5. ILLEGALITY; UNAVAILABILITY OF DEPOSITS.
(a) If any Bank shall determine (which determination shall be
conclusive and binding on the Borrower) that the introduction of or any change
in or in the interpretation of any law, regulation, guideline or order (in each
case, introduced, changed or interpreted after the Closing Date) makes it
unlawful, or any central bank or other governmental authority asserts that it
is unlawful, for such Bank to make, continue or maintain any Loan as, or to
convert any Loan into, a Loan of a certain Type, the obligations of the
affected Bank to make, continue, maintain or convert any such Loans shall, upon
such determination, forthwith be suspended until such Bank shall promptly
notify the Agent and the Borrower that the circumstances causing such
suspension no longer exist at the end of the then current Interest Periods with
respect thereto or sooner, if required by such law or assertion (in which case
the provisions of Section 3.6 shall be applicable).
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(b) If any Bank shall have determined that (i) deposits in
the relevant amount in Dollars are not available to such Bank in its relevant
market; or (ii) by reason of circumstances affecting such Bank's relevant
market, adequate means do not exist for ascertaining the interest rate
applicable hereunder to Eurodollar Loans, then it shall promptly notify the
Agent and the Borrower, and upon such notice, the obligations of all Banks to
make or continue any Loans as, or to convert any Loans into, Loans of such Type
shall, to the extent adversely and directly affected by such circumstances,
forthwith be suspended until the Agent shall notify the Borrower and the Banks
that the circumstances causing such suspension no longer exist (in which case
the provisions of Section 3.6 shall be applicable).
(c) Each Bank will use reasonable efforts to designate a
different Applicable Lending Office if such designation will avoid the effects
of this Section 3.5 and will not, in the judgment of such Bank, be otherwise
disadvantageous to it. The Borrower hereby agrees to pay all reasonable costs
and expenses incurred by any Bank in connection with any such designation.
3.6. TREATMENT OF AFFECTED LOANS. If the obligation of any
Bank to make a Loan or to continue, or to convert Loans of any other Type into,
Loans of a particular Type shall be suspended pursuant to Section 3.3 or 3.5
hereof (Loans of such Type being herein called "Affected Loans" and such Type
being herein called the "Affected Type"), such Bank's Affected Loans shall be
automatically converted into Canadian Prime Rate Loans on the last day(s) of
the then current Interest Period(s) for Affected Loans (or, in the case of a
conversion required by Section 3.5 hereof, on such earlier date as such Bank
may specify to the Borrower with a copy to the Agent) and, unless and until
such Bank gives notice as provided below that the circumstances specified in
Section 3.3 or 3.5 hereof that gave rise to such conversion no longer exist:
(a) to the extent that such Bank's Affected Loans have been
so converted, all payments and prepayments of principal that would
otherwise be applied to such Bank's Affected Loans shall be applied
instead to its Canadian Prime Rate Loans; and
(b) all Loans that would otherwise be made or continued by
such Bank as Loans of the Affected Type shall be made or continued
instead as Canadian Prime Rate Loans, and all Loans of such Bank that
would otherwise be converted into Loans of the Affected Type shall be
converted instead into (or shall remain as) Canadian Prime Rate Loans.
If such Bank gives notice to the Borrower (with a copy to the Agent) that the
circumstances specified in Section 3.3 or 3.5 hereof that gave rise to the
conversion of such Bank's Affected Loans pursuant to this Section 3.6 no longer
exist (which such Bank agrees to do promptly upon such circumstances ceasing to
exist) at a time when Loans of the Affected Type made by other Banks are
outstanding, such Bank's Canadian Prime Rate Loans shall be automatically
converted, on the first day(s) of the next succeeding Interest Period(s) for
such outstanding Loans of the Affected Type, to the extent necessary so that,
after giving effect thereto, all Loans held by the Banks holding Loans of the
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Affected Type and by such Bank are held pro rata (as to principal amounts,
Types, and Interest Periods) in accordance with their respective Commitments.
It is understood and agreed that the Canadian Prime Rate is
not an interest rate option voluntarily available to the Borrower hereunder,
but is instead an alternative "fall-back" rate available only under the
conditions specified in this Agreement.
3.7. COMPENSATION. Upon the request of any Bank, the Borrower
shall pay to such Bank such amount or amounts as shall be sufficient (in the
reasonable opinion of such Bank) to compensate it for any loss, cost, or
expense (including loss of anticipated profits) incurred by it as a result of-
(a) any payment, prepayment, or conversion of a Eurodollar
Loan for any reason (including, without limitation, the acceleration
of the Loans pursuant to Section 11) on a date other than the last day
of the Interest Period for such Eurodollar Loan; or
(b) any failure by the Borrower for any reason (including,
without limitation, the failure of any condition precedent specified
in Article 8 to be satisfied) to borrow, convert, continue, or prepay
a Loan on the date for such borrowing, conversion, continuation, or
prepayment specified in the relevant notice of borrowing, prepayment,
continuation, or conversion under this Agreement.
3.8. REPLACEMENT OF BANKS. If any Bank requests compensation
under Sections 2.8, 3.3 or 4.6, or if any Bank defaults in its obligation to
fund Loans hereunder, or otherwise has given notice pursuant to Sections 3.2,
3.4 or 3.5 (unless in each case the basis for such request or notice is
generally applicable to all Banks), then the Borrower may, at its sole expense
and effort, upon notice to such Bank and the Agent within 90 days of such
request or notice, if no Default or Event of Default exists, require such Bank
to assign and delegate (in accordance with and subject to the restrictions
contained in Section 13.10), all its interests, rights and obligations under
this Agreement to an assignee that shall assume such obligations (which
assignee may be another Bank, if a Bank accepts such assignment); provided that
(i) the Borrower shall have received the prior written consent of the Agent,
which consent shall not unreasonably be withheld, (ii) such Bank shall have
received payment of an amount equal to the outstanding principal of its Loans
accrued interest thereon, accrued fees and all other amounts payable to it
hereunder, from the assignee (to the extent of such outstanding principal and
accrued interest and fees) or the Borrower (in the case of all other amounts)
and (iii) in the case of any such assignment resulting from a claim for
compensation under Sections 2.8, 3.3 or 4.6, such assignment will result in a
reduction in such compensation or payments. A Bank shall not be required to
make any such assignment and delegation if, prior thereto, as a result of a
waiver by such Bank or otherwise, the circumstances entitling the Borrower to
require such assignment and delegation cease to apply.
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3.9. SURVIVAL. The agreements contained in Article 3 shall
survive the termination of this Agreement and the payment in full of the Notes
and all other amounts payable hereunder for a period of 180 days thereafter.
3.10. YEARLY RATE. Whenever interest hereunder is by the
terms hereof to be calculated on the basis of a year of 360 days (or 365 days
during a year of 366 days), the rate of interest applicable under this
Agreement to such calculation expressed as an annual rate for the purposes of
the Interest Act (Canada) is equivalent to such rate as so calculated
multiplied by the number of days in the calendar year in which the same is to
be ascertained and divided by 360 (or 365).
4. PREPAYMENTS AND OTHER PAYMENTS.
4.1. [INTENTIONALLY OMITTED]
4.2. OPTIONAL PREPAYMENTS. (a) The Borrower shall have the
right at any time and from time to time to prepay the Notes, in whole or in
part; provided, that each partial prepayment (i) of any Eurodollar Loans shall
be in an aggregate principal amount of at least C$1,000,000 or an integral
multiple of C$500,000 in excess thereof, and (ii) of any Canadian Prime Rate
Loans shall be in an aggregate principal amount of at least C$500,000 or an
integral multiple of C$100,000 in excess thereof, in each case, together with
interest accrued thereon to the date of such prepayment and all amounts due, if
any, under Section 3.7. Any prepayment shall be applied to reduce the remaining
scheduled installments in inverse order of maturity.
4.3. NOTICE OF PAYMENTS. The Borrower shall give the Agent at
least three (3) Business Days' prior written notice of each prepayment proposed
to be made by it pursuant to Section 4.2, specifying the principal amount of
the Loans to be prepaid, the prepayment date and the account of the Borrower to
be charged if such prepayment is to be so effected. Notice of such prepayment
having been given, the principal amount of the Loans specified in such notice,
together with interest thereon to the date of prepayment, shall become due and
payable on such prepayment date. If the Borrower pays or prepays any Eurodollar
Loan prior to the end of the Interest Period applicable thereto, such payment
shall be subject to Section 3.7.
4.4. PLACE OF PAYMENT OR PREPAYMENT. (a) All payments to be
made by the Borrower shall be made without set-off, recoupment or counterclaim.
All payments and prepayments made in accordance with the provisions of this
Agreement or of the Notes in respect of principal or interest on the Notes
shall be made to the Agent for the account of the relevant Bank, to an account
located in New York City, New York as identified by the Agent to the Borrower,
no later than 12:00 Noon (Dallas time) in immediately available funds and shall
be made in the applicable borrowed currency. Unless the Agent shall have
received notice from the Borrower prior to the date on which any payment is due
to the Banks hereunder that the Borrower will not make any payment due
hereunder in full, the Agent may assume that the Borrower has made such payment
in
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full to the Agent on such date and the Agent may, in reliance upon such
assumption, cause to be distributed to each Bank on such due date an amount
equal to the amount then due to such Bank. If and to the extent the Borrower
shall not have so made such payment in full to the Agent, each Bank shall repay
to the Agent forthwith on demand such amount distributed to such Bank together
with interest thereon, for each day from the date such amount is distributed to
such Bank until the date such Bank repays such amount to the Agent, at the
Overnight Rate. If and to the extent that the Agent receives any payment or
prepayment from the Borrower and fails to distribute such payment or prepayment
to the Banks ratably on the basis of their respective Pro Rata Percentage on
the day the Agent receives such payment or prepayment, and such distribution
shall not be so made by the Agent in full on the required day, the Agent shall
pay to each Bank such Bank's Pro Rata Percentage thereof together with interest
thereon at the Overnight Rate for each day from the date such amount is paid to
the Agent by the Borrower until the date the Agent pays such amount to such
Bank. Notwithstanding the Agent's failure to so distribute any such payment, as
between the Borrower and the Banks, such payment shall be deemed received and
collected.
(b) The Agent shall not be liable to the Borrower or any of
the Banks in any way whatsoever for any delay, or the consequences of any
delay, in the crediting to any account of any amount required by this Agreement
to be paid by the Agent if the Agent shall have taken all relevant steps to
achieve, on the date required by this Agreement, the payment of such amount in
immediately available, freely transferable, cleared funds in Dollars to the
account with the bank in the principal financial center which the Borrower or,
as the case may be, any Bank shall have specified for such purpose. In this
paragraph (b), "all relevant steps" means all such steps as may be prescribed
from time to time by the regulations or operating procedures or such clearing
or settlement system as the Agent may from time to time determine for the
purpose of clearing or settling payments of Dollars.
4.5. NO PREPAYMENT PREMIUM OR PENALTY. Each prepayment
pursuant to Section 4.1 or 4.2 shall be without premium or penalty.
4.6. TAXES.
(a) Subject to Section 13.11, any and all payments by the
Borrower hereunder or under any other Loan Document to or for the account of
any Bank or the Agent shall be made free and clear of and without deduction for
any and all present or future taxes, deductions, charges or withholdings, and
all liabilities with respect thereto, including, without limitation, such
taxes, deductions, charges, withholdings or liabilities whatsoever, excluding,
in the case of each Bank and Agent, taxes imposed on its net income (including
penalties and interest payable in respect thereof), and franchise taxes imposed
on it, by the jurisdiction under the laws of which such Bank or Agent (as the
case may be) is organized or any political subdivision thereof and, in the case
of each Bank, taxes imposed on its net income (including penalties and interest
payable in respect thereof), and franchise taxes imposed on it, by the
jurisdiction of such Bank's Applicable Lending Office or any political
subdivision thereof and, in the case of each Bank and Agent, taxes imposed by
reason of such Bank or Agent, for the purposes of the Income Tax Act (Canada),
not dealing at arm's length
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with the Borrower or being resident in Canada or carrying on business in
Canada, determined otherwise than solely on the basis of entering into any Loan
Document to which it is a party or consummating the transactions contemplated
thereby or in order to exercise the rights purported to be granted thereto
under the Loan Documents or receiving payments thereunder (all such non-
excluded taxes, deductions, charges, withholdings and liabilities being
hereinafter referred to as "Taxes"). In the case of a Bank that is a domestic
corporation, within the meaning of Section 7701 of the Code, the taxes that are
imposed by the United States of America and that are identified in the
preceding sentence are the taxes that are imposed by Section 11, Section 55 and
Section 59A of the Code, or by any comparable provision of future law. Subject
to Section 13.11 hereof, if the Borrower shall be required by Law to deduct any
Taxes from or in respect of any sum payable hereunder or under any Note to any
Bank or Agent (i) the sum payable shall be increased as may be necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section 4.6) such Bank or Agent (as the case
may be) receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions, (iii) the
Borrower shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable Law and (iv) the Borrower
shall confirm that all applicable Taxes, if any, imposed on it by virtue of the
transactions under this Agreement have been properly and legally paid by it to
the appropriate taxing authorities by sending official tax receipts or
notarized copies of such receipts to such Bank within thirty (30) days after
payment of any applicable tax.
(b) In addition, subject to Section 13.11 hereof, the
Borrower agrees to pay any present or future stamp or documentary taxes, value
added taxes or any other excise or property taxes, charges or similar levies
which arise from any payment made hereunder or under the Notes or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement or any other Loan Document (hereinafter referred to as "Other
Taxes").
(c) SUBJECT TO SECTION 13.11 HEREOF, THE BORROWER WILL
INDEMNIFY EACH BANK AND AGENT FOR THE FULL AMOUNT OF TAXES OR OTHER TAXES
(INCLUDING, WITHOUT LIMITATION, ANY TAXES OR OTHER TAXES IMPOSED BY ANY
JURISDICTION ON AMOUNTS PAYABLE UNDER THIS SECTION 4.6) PAID BY SUCH BANK OR
AGENT (ON THEIR BEHALF OR ON BEHALF OF ANY BANK) (AS THE CASE MAY BE) AND ANY
LIABILITY (INCLUDING PENALTIES, INTEREST AND EXPENSES) ARISING THEREFROM OR
WITH RESPECT THERETO, WHETHER OR NOT SUCH TAXES OR OTHER TAXES WERE CORRECTLY
OR LEGALLY ASSERTED. THIS INDEMNIFICATION SHALL BE MADE WITHIN THIRTY (30) DAYS
FROM THE DATE SUCH BANK OR AGENT (AS THE CASE MAY BE) MAKES WRITTEN DEMAND
THEREFOR.
(d) Each Bank organized under the laws of a jurisdiction
outside the United States, on or prior to the date of its execution and
delivery of this Agreement in the case of each Bank listed on the signature
pages hereof and on or prior to the date on which it becomes a Bank in the case
of each other Bank, and from time to time thereafter if requested in writing by
the Borrower or the Agent (but only so long as such Bank remains lawfully able
to do so), shall provide the Borrower and the Agent with (i) Internal Revenue
Service Form 1001 or 4224, as appropriate, or any
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successor form prescribed by the Internal Revenue Service, certifying that such
Bank is entitled to benefits under an income tax treaty to which the United
States is a party which reduces the rate of withholding tax on payments of
interest or certifying that the income receivable pursuant to this Agreement is
effectively connected with the conduct of a trade or business in the United
States, (ii) Internal Revenue Service Form W-8 or W-9, as appropriate, or any
successor form prescribed by the Internal Revenue Service, and (iii) any other
form or certificate required by any taxing authority (including any certificate
required by Sections 871(h) and 881(c) of the Internal Revenue Code),
certifying that such Bank is entitled to an exemption from or a reduced rate of
tax on payments pursuant to this Agreement or any of the other Loan Documents.
(e) For any period with respect to which a Bank has failed to
provide the Borrower and the Agent with the appropriate form pursuant to
Section 4.6(d) (unless such failure is due to a change in treaty, law, or
regulation occurring subsequent to the date on which a form originally was
required to be provided), such Bank shall not be entitled to indemnification
under Section 4.6 with respect to Taxes imposed by the United States; provided,
however, that should a Bank, which is otherwise exempt from or subject to a
reduced rate of withholding tax, become subject to Taxes because of its failure
to deliver a form required hereunder, the Borrower shall take such steps as
such Bank shall reasonably request to assist such Bank to recover such Taxes.
(f) If the Borrower is required to pay additional amounts to
or for the account of any Bank pursuant to this Section 4.6, then such Bank
will agree to use reasonable efforts to change the jurisdiction of its
Applicable Lending Office so as to eliminate or reduce any such additional
payment which may thereafter accrue if such change, in the judgment of such
Bank, is not otherwise disadvantageous to such Bank.
(g) Within thirty (30) days after the date of any payment of
Taxes, the Borrower shall furnish to the Agent the original or a certified copy
of a receipt evidencing such payment.
(h) Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreement and obligations of the Borrower
contained in this Section 4.6 shall survive the payment in full of principal
and interest hereunder and under the Notes.
4.7. [INTENTIONALLY OMITTED]
4.8. PAYMENTS ON BUSINESS DAY. Whenever any payment or
prepayment hereunder or under any Note shall be stated to be due on a day other
than a Business Day, such payment shall be made on the next succeeding Business
Day, and such extension of time shall in such case be included in the
computation of payment of interest; provided, however, if such extension would
cause payment of interest on or principal of Eurodollar Loans to be made in the
next following calendar month, such payment shall be made on the next preceding
Business Day.
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5. FEES.
5.1. [INTENTIONALLY OMITTED]
5.2. ARRANGEMENT FEE. The Parent agrees to pay to NationsBanc
Xxxxxxxxxx Securities L.L.C. for its own account the fees set forth in that
certain fee letter dated as of November 23, 1998 between NationsBanc Xxxxxxxxxx
Securities LLC, NationsBank, N.A. and the Parent.
5.3. UPFRONT FEES. The Parent agrees to pay to each Bank for
its own account the fees set forth in those certain fee letters dated as of
December 4, 1998 to each Bank from NationsBanc Xxxxxxxxxx Securities L.L.C.
5.4. ADMINISTRATIVE AGENCY FEE. The Parent agrees to pay to
NationsBank, N.A. for its own account the fees set forth in that certain fee
letter dated as of November 23, 1998 between NationsBanc Xxxxxxxxxx Securities
LLC, NationsBank, N.A. and the Parent.
5.5. [INTENTIONALLY OMITTED]
5.6. FEES NOT INTEREST; NONPAYMENT. The fees described in
this Agreement represent compensation for services rendered and to be rendered
separate and apart from the lending of money or the provision of credit and do
not constitute compensation for the use, detention, or forbearance of money,
and, subject to Section 13.11, the obligation of the Borrower and the Parent,
as the case may be, to pay each fee described herein shall be in addition to,
and not in lieu of, the obligation of the Borrower and the Parent, as the case
may be, to pay interest, other fees described in this Agreement, and expenses
otherwise described in this Agreement.
6. APPLICATION OF PROCEEDS. The Borrower agrees that the proceeds of
the Loans shall be immediately advanced to Xxxxxx Retail Group Inc., which
shall use such funds to permanently repay in full on the Closing Date certain
Debt described in Section 4.10 of the Combination Agreement.
7. REPRESENTATIONS AND WARRANTIES. The Parent represents and warrants
that:
7.1. ORGANIZATION AND QUALIFICATION. The Parent and each
Restricted Subsidiary (a) is duly organized, validly existing, and in good
standing under the laws of its jurisdiction of organization; (b) has the power
and authority to own its properties and to carry on its business as now
conducted; and (c) is duly qualified to do business and is in good standing in
every jurisdiction where such qualification is necessary and where failure to
be so qualified would have a Material Adverse Effect.
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7.2. FINANCIAL STATEMENTS. The Parent has furnished the Banks
with its certified consolidated audited financial statements for the Fiscal
Year 1997, and for the fiscal quarter ended October 31, 1998, including balance
sheets, income and cash flow statements. The statements described above have
been prepared in conformity with GAAP. The statements described above fully and
fairly reflect the consolidated financial condition of the Parent and its
Subsidiaries and the results of their operations as at the dates and for the
periods indicated. As of the Closing Date, there has been no event since
October 31, 1998 which could reasonably be expected to have a Material Adverse
Effect. As of the Closing Date, there exists no material contingent liabilities
or obligations of the Parent or any of its Subsidiaries which are not fully
disclosed in such financial statements or disclosed by the Parent to the Agent
in writing.
7.3. LITIGATION. There is no action or proceeding pending
(or, to the best knowledge of the Parent, threatened) against the Parent or any
Subsidiary thereof before any court, administrative agency or arbitrator which
could reasonably be expected to have a Material Adverse Effect.
7.4. DEFAULT. Neither the Parent nor any Subsidiary thereof
is in default under or in violation of (i) the provisions of any instrument
evidencing any Debt or of any agreement relating thereto or (ii) any judgment,
order, writ, injunction or decree of any court or any order, regulation or
demand of any Governmental Authority, in each case which default or violation
could reasonably be expected to have a Material Adverse Effect. There is in
effect no waiver or waivers with respect to any loan agreement, indenture,
mortgage, security agreement, lease or other agreement or obligation to which
the Parent or any Restricted Subsidiary thereof is a party which is limited as
to duration or is subject to the fulfillment of any condition which if not in
effect could reasonably be expected to have a Material Adverse Effect.
7.5. TITLE TO PROPERTIES. The Parent and each Restricted
Subsidiary have good and indefeasible title to, or valid leasehold interests
in, its respective material real and personal Properties, in each case,
purported to be owned or leased by it, as the case may be, free of any Liens
except those permitted in Section 10.1. All Leases necessary for the conduct of
the business of the Parent and each Restricted Subsidiary are valid and
subsisting and are in full force and effect.
7.6. PAYMENT OF TAXES. The Parent and each Subsidiary thereof
has filed or caused to be filed all federal, state, provincial and foreign
income tax returns which are required to be filed, and has paid or caused to be
paid all taxes as shown on such returns or on any assessment received by it to
the extent that such taxes have become due, except for such taxes and
assessments as are being contested in good faith in appropriate proceedings and
reserved for in accordance with GAAP in the manner required by Section 9.10.
7.7. CONFLICTING OR ADVERSE AGREEMENTS OR RESTRICTIONS.
Neither Parent nor any Subsidiary thereof is a party to any contract or
agreement or subject to any restriction which could reasonably be expected to
have a Material Adverse Effect. Neither the execution and delivery by
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the Parent or any Subsidiary of the Loan Documents and the Acquisition
Documents to which it is a party, nor the consummation of the transactions
contemplated thereby nor its fulfillment of and compliance with the respective
terms, conditions and provisions thereof will (i) result in a breach of, or
constitute a default under the provisions of (a) any order, writ, injunction or
decree of any court which is applicable to it or (b) any material contract or
agreement to which it is a party or by which it is bound, (ii) result in or
require the creation or imposition of any Lien on any of its property pursuant
to the express provisions of any material agreement to which it is a party, or
(iii) result in any violation by it of (a) its charter or bylaws or (b) any Law
or regulation of any Governmental Authority applicable to it.
7.8. AUTHORIZATION, VALIDITY, ETC. The Parent and each
Subsidiary thereof has the power and authority to make, execute, deliver and
carry out the Loan Documents and the Acquisition Documents to which it is a
party and the transactions contemplated therein and to perform its obligations
thereunder and all such action has been duly authorized by all necessary
proceedings on its part. The Loan Documents and the Acquisition Documents to
which it is a party have been duly and validly executed and delivered by the
Parent and each Subsidiary thereof and constitute valid and legally binding
agreements of the Parent and each Subsidiary thereof enforceable in accordance
with their respective terms, except as limited by Debtor Laws.
7.9. INVESTMENT COMPANY ACT NOT APPLICABLE. Neither Parent
nor any Subsidiary thereof is an "investment company", or a company
"controlled" by an "investment company", within the meaning of the Investment
Company Act of 1940, as amended.
7.10. PUBLIC UTILITY HOLDING COMPANY ACT NOT APPLICABLE.
Neither Parent nor any Subsidiary thereof is a "holding company", or a
"subsidiary company" of a "holding company", or an "affiliate" of a "holding
company", or an affiliate of a "subsidiary company" of a "holding company", or
a "public utility", as such terms are defined in the Public Utility Holding
Company Act of 1935, as amended.
7.11. MARGIN STOCK. Neither the Parent nor any Subsidiary
thereof is engaged in the business of extending credit for the purpose of
purchasing or carrying Margin Stock, and no proceeds of any Loan will be used
(a) to purchase or carry any Margin Stock or to extend credit to others for the
purpose of purchasing or carrying any Margin Stock; (b) to reduce or retire any
Debt which was originally incurred to purchase or carry any such Margin Stock;
(c) for any other purpose which might constitute this transaction a "purpose
credit" within the meaning of Regulation T, U or X; or (d) to acquire any
security of any Person who is subject to Sections 13 and 14 of the Securities
Exchange Act. After applying the proceeds of each Loan, not more than
twenty-five percent (25%) of the value (as determined by any reasonable method)
of the Borrower's assets is represented by Margin Stock. Neither the Parent nor
any Subsidiary thereof, nor any Person acting on behalf of the Parent or any
Subsidiary, has taken or will take any action which might cause any Loan
Document to violate Regulation T, U or X or any other regulation of the Board
of Governors of the Federal Reserve System.
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43
7.12. ERISA. Neither the Parent nor any ERISA Affiliate has
ever established, maintained, contributed to or been obligated to contribute
to, and neither the Parent and each ERISA Affiliate nor any ERISA Affiliate has
any liability or obligation with respect to any PBGC Plan, Multiemployer Plan
or Multiple Employer Plan. Neither the Parent nor any ERISA Affiliate has any
present intention to establish a PBGC Plan, a Multiemployer Plan or a Multiple
Employer Plan. Neither the Parent nor any ERISA Affiliate has ever established,
maintained, contributed to or been obligated to contribute to any employee
welfare benefit plan (as defined in Section 3(1) of ERISA) which provides
benefits to retired employees (other than as required by Section 601 of ERISA).
The Parent and each ERISA Affiliate is in compliance in all material respects
with all applicable provisions of ERISA and the Code with respect to each Plan,
including the fiduciary provisions thereof, and each Plan is, and has been,
maintained in compliance in all material respects with ERISA and, where
applicable, the Code. Full payment when due has (and, on the Closing Date will
have) been made of all amounts which the Parent and each ERISA Affiliate is
required under the terms of each Plan or applicable law to have paid as
contributions to such Plan as of the date hereof.
7.13. FULL DISCLOSURE. All information heretofore or
contemporaneously furnished by or on behalf of the Parent or any Subsidiary
thereof in writing to the Agent or any Bank for purposes of or in connection
with this Agreement or any transaction contemplated hereby is, and all other
such information hereafter furnished by or on behalf of the Parent or any
Subsidiary thereof in writing to the Agent or any Bank will be, (a) true and
accurate in all material respects on the date as of which such information is
dated or certified and (b) taken as a whole with all such written information
provided to the Agent or any Bank, not incomplete by omitting to state any
material fact necessary to make such information not misleading in light of the
circumstances under which such information was provided. There is no fact known
to the Parent or any Subsidiary which is reasonably likely to have a Material
Adverse Effect, which has not been disclosed herein or in such other written
documents, information or certificates furnished to the Agent and the Banks for
use in connection with the transactions contemplated hereby.
7.14. ENVIRONMENTAL MATTERS. (a) Neither the Parent nor any
Subsidiary thereof (i) has received any summons, citation, directive, letter,
notice or other form of communication, or otherwise learned of any claim,
demand, action, event, condition, report or investigation indicating or
concerning any potential or actual liability which would individually, or in
the aggregate, have a Material Adverse Effect arising in connection with (A)
any noncompliance with, or violation of, the requirements of any Environmental
Protection Statute; (B) the release, or threatened release, of any Hazardous
Materials into the environment; or (C) the existence of any Environmental Lien
on any Property of the Parent or any Subsidiary; or (ii) has any actual or, to
its knowledge, threatened liability to any Person under any Environmental
Protection Statute which would, individually or in the aggregate, have a
Material Adverse Effect.
(b) The Parent and each Subsidiary thereof has obtained all
consents, licenses or permits which are required under all Environmental
Protection Statutes (including, without limitation, laws relating to emissions,
discharges, releases or threatened releases of Hazardous
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44
Materials into the environment (including, without limitation, air, surface
water, ground water or land) or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of Hazardous Materials), except to the extent that failure to have or
obtain any such consent, license or permit does not have a Material Adverse
Effect. The Parent and each Subsidiary thereof is in compliance with all terms
and conditions of the consents, licenses or permits required to be obtained by
it, and is also in compliance with all other limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations, schedules and
timetables contained in those laws or contained in any regulation, code, plan,
order, injunction, notice or demand letter issued, entered, promulgated or
approved thereunder, except to the extent that failure to comply does not have
a Material Adverse Effect.
7.15. PERMITS AND LICENSES. All material permits, licenses
and other Governmental Approvals necessary for the Parent and its Restricted
Subsidiaries to carry on their respective businesses have been obtained and are
in full force and effect and neither the Parent nor any Subsidiary is in
material breach of the foregoing. The Parent and each Restricted Subsidiary
thereof own, or possess adequate licenses or other valid rights to use, United
States trademarks, trade names, service marks, copyrights, patents and
applications therefore which are material to the conduct of the business,
operations or financial condition of the Parent or such Restricted Subsidiary.
7.16. SOLVENCY. As of the Closing Date, upon giving effect to
the Moores Acquisition and the issuance of the Notes and the execution of the
Loan Documents by the Parent and each Subsidiary which is a party thereto, the
following are true and correct:
(a) The fair saleable value of the assets of the Parent and
each Subsidiary exceeds the amount that will be required to be paid
on, or in respect of, the existing debts and other liabilities
(including, without limitation, pending or overtly threatened
litigation in reasonably foreseeable amounts in excess of effective
insurance coverage and all other contingent liabilities) of the Parent
and each Subsidiary as they mature;
(b) The assets of the Parent and each Subsidiary do not
constitute unreasonably small capital for it to carry out its business
as now conducted and as proposed to be conducted including its capital
needs, taking into account the particular capital requirements of the
business conducted by it, and reasonably projected capital
requirements and capital availability thereof; and
(c) Neither the Parent, nor any Subsidiary, intends to incur
debts beyond its ability to pay such debts as they mature (taking into
account the timing and amounts of cash reasonably expected to be
received by the Parent and such Subsidiary, as the case may be, and of
amounts reasonably expected to be payable on or in respect of debt of
the Parent and such Subsidiary, as the case may be).
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45
7.17. CAPITAL STRUCTURE. As of the Closing Date and after
giving effect to the Moores Acquisition, the Parent owns the percentage of all
classes of Capital Stock of each Subsidiary and the ownership of each such
Subsidiary and the ownership of Parent as of the date hereof is as set forth on
Schedule 7.17 attached hereto. Except for the Subsidiaries described on
Schedule 7.17 or as otherwise notified to the Agent in writing pursuant to
Section 9.1(i), the Parent has no other Subsidiaries. As of the Closing Date
and after giving effect to the Moores Acquisition, Parent has no partnership or
joint venture interests in any other Person except as set forth in Schedule
7.17. All of the issued and outstanding shares of Capital Stock of the Parent
and each Subsidiary are fully paid and nonassessable and, except as created by
the Pledge Agreements and, with respect to the Exchangeable Shares, except for
the rights of the holders of the Exchangeable Shares to receive Capital Stock
of the Parent pursuant to the Combination Agreement, are free and clear of any
Lien.
7.18. INSURANCE. The Parent and each Subsidiary maintain
insurance of such types as is usually carried by corporations of established
reputation engaged in the same or similar business and which are similarly
situated ("Similar Businesses") with financially sound and reputable insurance
companies and associations (or as to workers' compensation or similar
insurance, in an insurance fund or by self-insurance authorized by the
jurisdiction in which its operations are carried on), and in such amounts as
such insurance is usually carried by Similar Businesses.
7.19. COMPLIANCE WITH LAWS. The business and operations of
the Parent and each Restricted Subsidiary as conducted at all times have been
and are in compliance in all respects with all applicable Laws, except where
the failure to so comply could not reasonably be expected to have a Material
Adverse Effect.
7.20. NO CONSENT. Except to the extent the same has already
been obtained, no authorization or approval or other action by, and no notice
to or filing with, any Person or any Governmental Authority is required for the
due execution, delivery and performance by the Parent or any Subsidiary thereof
of this Agreement or any other Loan Document or Acquisition Document to which
it is a party, the borrowings hereunder or issuance of Letters of Credit, in
each case as contemplated herein, or the effectuation of the transactions
contemplated under any Loan Document or Acquisition Document to which it is a
party.
7.21. YEAR 2000.
(a) Parent has (i) begun analyzing the operations of Parent
and its Subsidiaries and Affiliates that could be adversely affected by failure
to become Year 2000 compliant (that is, that computer applications, imbedded
microchips and other systems will be able to perform date-sensitive functions
prior to and after December 31, 1999) and; (ii) developed a plan for becoming
Year 2000 compliant in a timely manner, the implementation of which is on
schedule in all material respects. Parent reasonably believes that it will
become Year 2000 compliant for its
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46
operations and those of its Subsidiaries and Affiliates on a timely basis
except to the extent that a failure to do so could not reasonably be expected
to have a Material Adverse Effect.
(b) Parent reasonably believes any suppliers and vendors that
are material to the operations of Parent or its Subsidiaries and Affiliates
will be Year 2000 compliant for their own computer applications except to the
extent that a failure to do so could not reasonably be expected to have a
Material Adverse Effect.
(c) Parent will promptly notify the Agent in the event Parent
determines that any computer application which is material to the operations of
Parent, its Subsidiaries or any of its material vendors or suppliers will not
be fully Year 2000 compliant on a timely basis, except to the extent that such
failure could not reasonably be expected to have a Material Adverse Effect.
7.22. ACQUISITION DOCUMENTS. All representations and
warranties made by Parent and its Subsidiaries, and to the best of Parent's
knowledge, all representations and warranties made by the other parties
thereto, in the Acquisition Documents are or will be true and correct in all
material respects on and as of each date made or deemed made therein. No rights
of cancellation or recision, no material defaults and no defenses exist with
respect to the Acquisition Documents.
8. CONDITIONS.
8.1. CONDITIONS TO EFFECTIVENESS OF AGREEMENT. The
effectiveness of Agreement is subject to the following conditions:
(a) Approvals. The Borrower shall have obtained all orders,
approvals or consents of all Persons required for the execution,
delivery and performance by the Parent, the Borrower and each
Subsidiary of each Loan Document to which it is a party.
(b) Compliance with Law. The business and operations of the
Parent, the Borrower and each Subsidiary as conducted at all times
relevant to the transactions contemplated by this Agreement to and
including the close of business on the Closing Date shall have been
and shall be in compliance (other than any failure to be in compliance
that does not result in a Material Adverse Effect) with all applicable
Laws. No Law shall prohibit the transactions contemplated by the Loan
Documents. No order, judgment or decree of any Governmental Authority,
and no action, suit, investigation or proceeding pending or threatened
in any court or before any arbitrator or Governmental Authority that
purports to affect the Parent, the Borrower or any Subsidiary, shall
exist that could reasonably be expected to have a Material Adverse
Effect.
(c) Officer's Certificate. On the Closing Date, the Agent
shall have received a certificate dated the Closing Date of a
Responsible Officer of the Parent (with a copy thereof for each Bank)
certifying that (i) except as disclosed by the Parent to the Agent in
writing,
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there has not occurred a material adverse change in the business,
assets, operations, condition (financial or otherwise) or prospects of
the Parent and its Subsidiaries or in the facts and information
regarding such Persons as represented in the Parent's most recent
quarterly financial statements dated October 31, 1998, (ii) the Parent
and its Restricted Subsidiaries are in compliance with all existing
financial obligations, (iii) after giving effect to the Moores
Acquisition, no Default or Event of Default shall have occurred and be
continuing, and (iv) the representations and warranties of the Parent
and each Restricted Subsidiary contained in the Loan Documents (other
than those representations and warranties limited by their terms to a
specific date, in which case they shall be true and correct as of such
date) shall be true and correct on and as of the Closing Date, after
giving effect to the Moores Acquisition.
(d) Insurance. On the Closing Date, the Agent shall have
received all such information as the Agent shall reasonably request
concerning the insurance maintained by the Parent and each Subsidiary.
(e) Payment of Fees and Expenses. Payment of (i) all fees due
and owing and described in Section 5 hereof and (ii) the reasonable
expenses of, or incurred by, the Agent and counsel, to the extent
billed as of the Closing Date, to and including the Closing Date in
connection with the negotiation and closing of the transactions
contemplated herein.
(f) Fee Letters. The Parent shall have executed and delivered
the fee letters described in Sections 5.2 and 5.4.
(g) Required Documents and Certificates. On the Closing Date,
the Banks shall have received the following, in each case in form,
scope and substance satisfactory to the Banks:
(i) this Agreement;
(ii) the Notes;
(iii) the Affiliate Guaranty executed and delivered
by Golden Moores Company and each Restricted Subsidiary
organized in the United States of America or any state
thereof (other than Xxxxxx The Suit People U.S., Inc., Men's
Wearhouse (Canada), Inc., TMW Moores Group, Inc., The Men's
Wearhouse (Nevada) Inc. and Value Priced Clothing II, Inc.)
existing as of the Closing Date and the Parent Guaranty;
(iv) the Pledge Agreement, together with any
certificates representing all shares of such stock so pledged
and for each such certificate a stock power executed in
blank;
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(v) an Officer's Certificate from the Parent and
each Restricted Subsidiary (excluding Xxxxxx The Suit People
U.S., Inc., The Men's Wearhouse (Nevada) Inc., Value Priced
Clothing II, Inc., Men's Wearhouse (Canada), Inc., TMW Moores
Group, Inc.), dated as of the Closing Date certifying, inter
alia, (A) Articles of Incorporation or Bylaws (or equivalent
corporate documents), as amended and in effect of such
Person; (B) resolutions duly adopted by the Board of
Directors of such Person authorizing the transactions
contemplated by the Loan Documents to which it is a party,
(C) the incumbency and specimen signatures of the officers of
such Person executing documents on its behalf; and (D) in the
case of Golden Moores Company, shareholder consents regarding
its execution, delivery and performance of the Loan
Documents;
(vi) a certificate from the appropriate public
official of each jurisdiction in which the Parent and each
Subsidiary is organized as to the continued existence and
good standing of such Person;
(vii) a certificate from the appropriate public
official of each jurisdiction in which the Parent and each
Subsidiary is authorized and qualified to do business as to
the due qualification and good standing of such Person, where
failure to be so qualified or certified is reasonably likely
to have a Material Adverse Effect;
(viii) legal opinions in form, substance and scope
satisfactory to the Agent from counsel for, and issued upon
the express instructions of, the Parent, the Borrower and the
Affiliate Guarantors;
(ix) certified copies of Requests for Information of
Copies (Form UCC-11), or equivalent reports for each Canadian
province, for the States of Texas and California and the
Canadian equivalent listing all effective financing
statements which name the Parent and each Subsidiary (under
its present name, any trade names and any previous names) as
debtor and which are filed, together with copies of all such
financing statements; and
(x) any other documents reasonably requested by the
Agent prior to the Closing Date.
(h) Related Facilities. All conditions precedent to the
effectiveness of each Related Facility shall be satisfied.
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(i) Consummation of the Moores Acquisition.
(i) Within five (5) Business Days after the Closing
Date, the Parent shall deliver to the Agent (with a copy
thereof for each Bank) copies of (i) the Combination
Agreement, (ii) the Articles of Amendment giving effect to
the Share Restructuring Plan, (iii) the Support Agreement,
(iv) the Voting Trust Agreement, (v) the certificates
delivered pursuant to Section 5.2(c) and 5.3(c) of the
Combination Agreement, (vi) the Subscription Agreement, and
(vii) the Intercompany Credit Agreements (capitalized terms
used in this Section 8.1(i)(i) not otherwise defined having
the meaning set forth in the Combination Agreement).
(ii) On the Closing Date, Parent shall deliver to
the Agent an Officer's Certificate certifying that (i) the
"Effective Date" (as defined in the Combination Agreement)
has occurred and (ii) the Acquisition Documents and all
operative instruments executed in connection therewith are
valid, binding and enforceable against the parties thereto in
accordance with their terms, subject to the effect of Debtor
Laws, and, except as otherwise set forth in such Officer's
Certificate, none of the principal terms or conditions to
closing of any party set forth in the Acquisition Documents
have been, without the prior written consent of the Banks,
amended or supplemented, and all conditions stated therein
shall have been satisfied without waiver.
In addition, as of the Closing Date, all legal matters
incident to the transactions herein contemplated shall be satisfactory to
counsel for the Agent and the Banks.
8.2. CONDITIONS TO EACH LOAN. The obligation of the Banks to
make, continue and convert each Loan is subject to the following conditions:
(a) Representations True and No Defaults. (i) The
representations and warranties of the Parent and each Subsidiary
contained in the Loan Documents (other than those representations and
warranties limited by their terms to a specific date, in which case
they shall be true and correct as of such date) shall be true and
correct on and as of the particular Borrowing Date or the applicable
Conversion/ Continuation Date as the case may be, as though made on
and as of such date; (ii) except as disclosed by the Borrower to the
Agent in writing, no event has occurred since the date of the most
recent financial statements delivered pursuant to Section 9.1(a) (or
in the case of a borrowing prior to the delivery of such statements,
October 31, 1998), that has caused a Material Adverse Effect; and
(iii) no Event of Default or Default shall have occurred and be
continuing.
(b) Borrowing Documents. On each Borrowing Date, the Agent
shall have received a Notice of Borrowing in respect of the Loans
delivered in accordance with Section 2.2.
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(c) Conversion/Continuation Documents. On each
Conversion/Continuation Date, the Agent shall have received a Notice
of Rate Change/Continuation.
9. AFFIRMATIVE COVENANTS. The Parent covenants and agrees that, so
long as any Note shall remain unpaid, the Parent will:
9.1. REPORTING AND NOTICE REQUIREMENTS. Furnish to the Agent
(with a copy for each Bank) for delivery to the Banks:
(a) Quarterly Financial Statements. As soon as available and
in any event within sixty (60) days after the end of each fiscal
quarter of the Parent (excluding the fourth quarter), consolidated
balance sheets of the Parent and its Subsidiaries as of the end of
such quarter and consolidated statements of earnings, shareholders'
equity and cash flow of the Parent and its Subsidiaries for the period
commencing at the end of the previous Fiscal Year of the Parent and
ending with the end of such fiscal quarter, setting forth in each case
in comparative form corresponding consolidated figures for the
corresponding period in the immediately preceding Fiscal Year of the
Parent, all in reasonable detail and certified by a Responsible
Officer of the Parent as presenting fairly the consolidated financial
position of the Parent and its Subsidiaries as of the date indicated
and the results of their operations for the period indicated in
conformity with GAAP, consistently applied, subject to changes
resulting from year-end adjustments.
(b) Annual Financial Statements. As soon as available and in
any event within one hundred five (105) days after the end of each
Fiscal Year of the Parent, audited consolidated statements of
earnings, shareholders' equity and cash flow of the Parent and its
Subsidiaries for such Fiscal Year, and audited consolidated balance
sheets of the Parent and its Subsidiaries as of the end of such Fiscal
Year, setting forth in each case in comparative form corresponding
consolidated figures for the immediately preceding year, all in
reasonable detail and satisfactory in form, substance, and scope to
the Agent, together with the unqualified opinion of independent
certified public accountants of recognized national standing selected
by the Parent, stating that such financial statements fairly present
the consolidated financial position of the Parent and its Subsidiaries
as of the date indicated and the consolidated results of their
operations and cash flow for the period indicated in conformity with
GAAP, consistently applied (except for such inconsistencies which may
be disclosed in such report), and that the audit by such accountants
in connection with such consolidated financial statements has been
made in accordance with generally accepted auditing standards.
(c) Consolidated Statements. In the event that the Parent or
any of its Restricted Subsidiaries have made an Investment in an
Unrestricted Subsidiary and such Investment continues to be
outstanding, consolidated financial statements (balance sheets,
statements of earnings, shareholders' equity and cash flow) of the
Parent and Restricted Subsidiaries.
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The consolidated financial statements referred to in this Section
9.1(c) will be provided within the time frame specified in Section
9.1(a) or 9.1(b), as appropriate, but will not be subject to audit and
will not include customary footnotes.
(d) Compliance Certificate. Together with the delivery of any
information required by Subsection (a) and Subsection (b) of this
Section 9.1, a certificate in the form of Exhibit E hereto signed by a
Responsible Officer of the Parent, (i) stating that there exists no
Event of Default or Default, or if any Event of Default or Default
exists, specifying the nature thereof, the period of existence
thereof, and what action the Parent proposes to take with respect
thereto; and (ii) setting forth such schedules, computations and other
information as may be required to demonstrate that the Parent is in
compliance with its covenants in Sections 10.13 and 10.14 hereof.
(e) Notice of Default. Promptly after any Responsible Officer
or the Corporate Controller of the Parent or the Borrower knows or has
reason to know that any Default or Event of Default has occurred, a
written statement of a Responsible Officer of the Parent setting forth
the details of such event and the action which the Parent has taken or
proposes to take with respect thereto.
(f) Notice of Litigation. Promptly after any Responsible
Officer or the Corporate Controller of the Parent or of any Subsidiary
obtaining knowledge of the commencement thereof, notice of any
litigation, legal, administrative or arbitral proceeding,
investigation or other action of any nature which involves the
reasonable possibility of any judgment or liability which could have a
Material Adverse Effect and which notice does not require a waiver of
the attorney-client privilege in respect of such litigation,
proceeding or investigation, and upon request by the Agent or any
Bank, details regarding such litigation which are satisfactory to the
Agent or such Bank.
(g) Securities Filings. Promptly after the sending or filing
thereof and in any event within fifteen (15) days thereof, copies of
all reports which the Parent sends to any of its securityholders, and
copies of all reports (including each regular and periodic report
(excluding registration statements on Form S-8)) and each registration
statement or prospectus, which the Parent or any Subsidiary files with
the Securities and Exchange Commission or any national securities
exchange.
(h) ERISA Notices, Information and Compliance. The Parent
will, and will cause each of its ERISA Affiliates to deliver to the
Agent, as soon as possible and in any event within ten (10) days after
the Parent or any of its ERISA Affiliates knows of the occurrence of
any of the following, a certificate of the chief financial officer of
the Parent (or, if applicable, of the ERISA Affiliate) setting forth
the details as to such occurrence and the action, if any, which the
Parent or ERISA Affiliate is required or proposes to take, together
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with any notices required or proposed to be given or filed with or by
the Parent, an ERISA Affiliate, the PBGC or plan administrator with
respect thereto:
(i) the establishment or adoption of any PBGC Plan,
Multiemployer Plan or Multiple Employer Plan by the Parent or
any ERISA Affiliate on or after the Effective Date (a "Future
Plan");
(ii) the occurrence of an ERISA Event with respect
to any Future Plan;
(iii) the existence of an accumulated funding
deficiency (within the meaning of Section 302 of ERISA) with
respect to any Future Plan as determined as of the end of
each Fiscal Year of the Future Plan;
(iv) the making of an application to the Secretary
of the Treasury for a waiver or modification of the minimum
funding standard (including any required installment
payments) or extension of any amortization period under
Section 412 of the Code with respect to any Future Plan;
(v) the institution of a proceeding pursuant to
Section 515 of ERISA to collect delinquent contributions from
the Parent or an ERISA Affiliate with respect to a Future
Plan;
(vi) the occurrence of any "prohibited transaction"
as described in Section 406 of ERISA or in Section 4975 of
the Code, in connection with any Plan or any trust created
thereunder; or
(vii) the failure to pay when due all amounts that
the Parent or any ERISA Affiliate is required under the terms
of each Plan or applicable law to have paid as a contribution
to such Plan.
Upon written request of the Agent, the Parent will and will
cause its ERISA Affiliates to obtain and deliver to the Agent, as soon
as possible and in any event within ten (10) days from receipt of the
request, a complete copy of the most recent annual report (Form 5500)
of each Plan required to be filed with the Internal Revenue Service
and copies of any other reports or notices which the Parent or an
ERISA Affiliate files with the Internal Revenue Service, PBGC or the
United States Department of Labor or which the Parent or an ERISA
Affiliate receives from such Governmental Authority.
(i) Notice of New Subsidiaries. Within ten (10) days after
the formation or acquisition of any Subsidiary of the Parent, a
certificate of a Responsible Officer of the Parent notifying the Agent
of such event.
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(j) Notice of Material Adverse Effect. Promptly after any
Responsible Officer or the Corporate Controller of the Parent or the
Borrower knows or has reason to know of the occurrence of any action
or event which may cause a Material Adverse Effect, a written
statement of the Responsible Officer of the Parent setting forth the
details of such action or event and the action which the Parent has
taken or proposes to take with respect thereto.
(k) Other Information. Such other information respecting the
condition or operations, financial or otherwise, of the Parent or any
of its Subsidiaries as any Bank through the Agent may from time to
time reasonably request.
9.2. CORPORATE EXISTENCE. Except as otherwise permitted by
Section 10.4 and except for the liquidation of Men's Wearhouse (Canada), Inc.,
TMW Moores Group, Inc., Value Priced Clothing II, Inc. and The Men's Wearhouse
(Nevada), Inc., remain, and cause each Restricted Subsidiary to remain, (i) a
corporation duly organized, validly existing, and in good standing under the
laws of its jurisdiction of organization, with the power to own its properties
and to carry on its business; and (ii) duly qualified to do business and in
good standing in every jurisdiction where such qualification is necessary and
where failure to be so qualified would have a Material Adverse Effect.
9.3. BOOKS AND RECORDS. Maintain, and cause each Subsidiary
to maintain, complete and accurate books of record and account in accordance
with sound accounting practices in which true, full and correct entries will be
made of all its dealings and business affairs.
9.4. INSURANCE. Maintain, and cause each Subsidiary to
maintain, insurance of such types as Similar Businesses with financially sound
and reputable insurance companies and associations (or as to workers'
compensation or similar insurance, in an insurance fund or by self-insurance
authorized by the jurisdiction in which its operations are carried on),
including without limitation public liability insurance, casualty insurance
against loss or damage to its Properties, assets and businesses now owned or
hereafter acquired, and business interruption insurance, and in such amounts as
such insurance is usually carried by Similar Businesses.
9.5. RIGHT OF INSPECTION. In each case subject to the last
sentence of this Section 9.5, from time to time during regular business hours
upon reasonable notice to the Parent and at no cost to the Parent (unless a
Default or Event of Default shall have occurred and be continuing at such time)
permit, and cause each Subsidiary to permit, any officer, or employee of, or
agent designated by, the Agent or any Bank to visit and inspect any of the
Properties of the Parent or any Subsidiary, examine the Parent's or such
Subsidiary's corporate books or financial records, take copies and extracts
therefrom and discuss the affairs, finances and accounts of the Parent or any
Subsidiary with the Parent's or such Subsidiary's officers or certified public
accountants (subject to the agreement of such accountants), all as often as the
Agent or any Bank may reasonably desire. At the request of the Agent, the
Parent will use its best efforts to assure that its certified public
accountants agree to meet with the Banks to discuss such matters related to the
affairs, finances and accounts of the Parent or any Subsidiary as they may
request; provided that a representative of the
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Parent and/or the Borrower shall be present during any such discussions with
such certified public accountants. Each of the foregoing inspections shall be
made subject to compliance with applicable safety standards and the same
conditions applicable to the Parent or any Restricted Subsidiary in respect of
property of that the Parent or any Restricted Subsidiary on the premises of
Persons other than the Parent or any Restricted Subsidiary, and all
information, books and records furnished or requested to be furnished, or of
which copies, photocopies or photographs are made or requested to be made, all
information to be investigated or verified and all discussions conducted with
any officer, employee or representative of the Parent or any Restricted
Subsidiary shall be subject to any applicable attorney-client privilege
exceptions which the Parent or any Restricted Subsidiary determines is
reasonably necessary and compliance with conditions to disclosures under
non-disclosure agreements between the Parent or any Restricted Subsidiary and
Persons other than the Parent or any Restricted Subsidiary and the express
undertaking of each Person acting at the direction of or on behalf of any Bank
or Agent to be bound by the confidentiality provisions of Section 13.21 of this
Agreement.
9.6. MAINTENANCE OF PROPERTY. At all times maintain,
preserve, protect and keep, and cause each Restricted Subsidiary to at all
times maintain, preserve, protect and keep, or cause to be maintained,
preserved, protected and kept, its Property in good repair, working order and
condition (ordinary wear and tear excepted) and, from time to time, will make,
or cause to be made, all repairs, renewals, replacements, extensions,
additions, betterments and improvements to its Property as are appropriate, so
that each of (a) (i) the Parent and (ii) the Parent and its Restricted
Subsidiaries, taken as a whole, maintain their current line of business, and
(b) the business carried on in connection therewith may be conducted properly
and efficiently at all times.
9.7. GUARANTEES OF CERTAIN RESTRICTED SUBSIDIARIES.
Immediately upon the designation, formation or acquisition of any Restricted
Subsidiary (and until designated an Unrestricted Subsidiary in accordance with
the terms hereof), cause such Restricted Subsidiary to provide to the Agent for
the benefit of the Banks a guaranty of the obligations of the Borrower under
this Agreement which shall be in the form of the guaranty supplement which is
set forth as Exhibit A to the Guaranty Agreement attached hereto as Exhibit E
(each, an "Affiliate Guaranty"), together with written evidence satisfactory to
Agent and its counsel that such Restricted Subsidiary has taken all corporate
and other action and obtained all consents necessary to duly approve and
authorize its execution, delivery and performance of the Affiliate Guaranty,
any other documents which it is required to execute, and an opinion of counsel
to such Restricted Subsidiary in form, scope and substance acceptable to the
Agent; provided, however, any Subsidiary organized under the laws of any
jurisdiction other than a jurisdiction located in the United States of America
(unless treated as a U.S. taxpayer under Section 7701 of the Code and the
regulations issued thereunder, or any successor provisions) shall not be
required to execute and deliver an Affiliate Guaranty (such Restricted
Subsidiary herein referred to as a "Non-Guaranteeing Restricted Subsidiary").
It is agreed and understood that the agreement of the Parent under this Section
9.7 to cause any such Restricted Subsidiary to provide to the Agent for the
benefit of the Banks an Affiliate Guaranty is a condition precedent to the
making of the Loans pursuant to this Agreement and that the entry into this
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Agreement by the Banks constitutes good and adequate consideration for the
provision of such Affiliate Guaranty. It is agreed and understood that the
Parent contemplates the liquidation of Men's Wearhouse (Canada), Inc., TMW
Moores Group, Inc., The Men's Wearhouse (Nevada) Inc. and Value Priced Clothing
II, Inc. and the distribution of their assets to the Parent and Value Priced
Clothing, Inc., respectively. Consequently, the guaranty of such Subsidiaries
will not be required on the Closing Date and the Parent covenants that such
Subsidiaries shall remain dormant and inactive until such liquidation. However,
each such Subsidiary shall be Restricted Subsidiary, and if any such Subsidiary
has not been liquidated and dissolved by February 12, 1999 such Subsidiary
shall then be required to execute and deliver a Guaranty pursuant to the
provisions of this Section 9.7. In addition, it is agreed and understood that
because Xxxxxx The Suit People U.S., Inc. is a de minimis Subsidiary, such
Subsidiary shall be a Restricted Subsidiary but shall not be required to
execute an Affiliate Guaranty as of the Closing Date. If there is a substantial
increase in the net worth of Xxxxxx The Suit People U.S., Inc. after the
Closing Date, the Parent agrees to cause such Restricted Subsidiary to become
an Affiliate Guarantor upon the request of the Agent.
9.8. ACCOUNTING PRINCIPLES. If any changes in accounting
principles from those used in the preparation of the financial statements
referenced in Section 9.1 are adopted by the Parent and such changes result in
a change in the method of calculation or the interpretation of any of the
financial covenants, standards or terms found in Section 9.1, Section 10.13,
Section 10.14 or any other provision of this Agreement, deliver to the Agent a
reconciliation prepared by a Responsible Officer of the Parent showing the
effect of such changes hereunder; provided that the Parent, the Borrower and
the Banks agree to amend any such affected terms and provisions so as to
reflect such changes with the result that the criteria for evaluating Parent's
or such Subsidiaries' financial condition shall be the same after such changes
as if such changes had not been made.
9.9. PATENTS, TRADEMARKS AND LICENSES. Maintain, and cause
each Restricted Subsidiary to maintain, all assets, licenses, patents,
copyrights, trademarks, service marks, trade names, permits and other
Governmental Approvals necessary to conduct its business except where the
failure to so maintain is not reasonably likely to have a Material Adverse
Effect.
9.10. TAXES; OBLIGATIONS. Pay and discharge, and cause each
Subsidiary to pay and discharge, before they become delinquent, all taxes,
assessments, and governmental charges or levies imposed upon the Parent, any
Subsidiary or upon the income or any Property of the Parent or any Subsidiary
as well as all material claims and obligations of any kind (including, without
limitation, claims for labor, materials, supplies, and rent) which, if unpaid,
might become a Lien upon any Property of the Parent or any Restricted
Subsidiary; provided, however, that neither the Parent nor any Subsidiary shall
be required to pay any such tax, assessment, charge, levy or claim if the
amount, applicability or validity thereof shall currently be contested in good
faith by appropriate proceedings diligently conducted by or on behalf of the
Parent or any such Subsidiary and, if required under GAAP, the Parent or any
such Subsidiary shall have established adequate reserves therefor.
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10. NEGATIVE COVENANTS. So long as any Note shall remain unpaid, any
Letter of Credit shall remain outstanding, or any Bank shall have any
Commitment hereunder:
10.1. LIENS. The Parent shall not, and shall not permit any
Restricted Subsidiary to, create, assume or permit to exist any Lien (including
the charge upon assets purchased under a conditional sales agreement, purchase
money mortgage, security agreement or other title retention agreement) upon any
of its Properties, whether now owned or hereafter acquired, or assign or
otherwise convey any right to receive income, other than:
(a) Permitted Liens;
(b) Liens existing on the Closing Date and described on
Schedule 10.1 attached hereto and made a part hereof and any Lien
securing the Debt described in Section 10.2(c)(ii) and Liens extending
the duration of any such existing Lien; provided that the principal
amount secured by such Lien is not increased and the extended Lien
does not cover any Property of the Parent or any Restricted Subsidiary
which is not covered by provisions of the instruments, as in effect on
the Closing Date, providing for the existing Lien extended thereby;
(c) Liens securing the Debt permitted by Section 10.2(b),
10.2(e) and 10.2(f) hereof;
(d) Liens created by the Pledge Agreement;
(e) purchase options granted to the Borrower pursuant to the
Subscription Agreement to purchase Capital Stock of Xxxxxx Retail
Group Inc.; and
(f) rights of the holders of the Exchangeable Shares to
exchange such shares for Capital Stock of the Parent pursuant to the
Combination Agreement.
10.2. DEBT. The Parent will not create or suffer to exist,
and will not permit any Restricted Subsidiary to create, incur, assume or
suffer to exist, any Debt except as set forth below, all of which shall be
"Permitted Debt":
(a) Debt of the Parent, the Borrower and the Affiliate
Guarantors to the Banks and the Agent evidenced by any Loan Document;
(b) in addition to Debt otherwise permitted to be incurred by
the Parent or any Restricted Subsidiary, as the case may be, by this
Section 10.2, secured or unsecured Debt of the Parent or any
Restricted Subsidiary to Persons (other than the Parent or any
Subsidiary) (other than the type of Debt permitted by Subsections (e)
and (f) hereof); provided that (i) at no time shall the aggregate
amount of all such Debt of the Parent and the
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Restricted Subsidiaries permitted by this Section 10.2(b) exceed 7
1/2% of Consolidated Net Worth, of which secured Debt may constitute
no more than 4% of Consolidated Net Worth and (ii) such Debt shall not
be incurred when a Default or Event of Default exists or would result
therefrom;
(c) (i) Debt of the Parent or any Restricted Subsidiary to
any Person (other than to the Borrower or any Subsidiary) and (ii)
secured or unsecured Debt of Xxxxxx The Suit People U.S., Inc. to
Xxxxxx Retail Group Inc. and Golden Brand Clothing (Canada) Ltd., in
each case existing on the date hereof and described on Schedule 10.2
attached hereto and made a part hereof; provided that such Debt is not
increased;
(d) unsecured Debt of the Parent to any Restricted Subsidiary
and unsecured Debt of any Restricted Subsidiary to the Parent or any
other Restricted Subsidiary; provided that (i) in each case the term
and provisions of such Debt shall be subject to Section 10.8, (ii) any
such unsecured Debt of the Parent or any Affiliate Guarantor shall be
subordinated in form and substance satisfactory to the Majority Banks
to the Obligations, (iii) any such unsecured Debt is incurred when no
Default or Event of Default exists or would result therefrom and (iv)
the aggregate principal amount of all Debt of the Non-Guaranteeing
Restricted Subsidiaries (except as permitted by Section 10.2(h)) to
the Parent and the Guarantors (as defined in the U.S. Revolving Credit
Agreement) shall not exceed the lesser of (A) U.S.$30,000,000 and (B)
10% of the Consolidated Net Worth;
(e) Debt of the Parent or any Restricted Subsidiary
representing Capital Leases; provided that at no time shall the
aggregate amount of Debt of the Parent and its Restricted Subsidiaries
permitted by this Section 10.2(e) exceed 5% of Consolidated Net Worth;
(f) Debt relating to Sale and Lease-Back Transactions
permitted under Section 10.6(c);
(g) unsecured Debt incurred in the ordinary course of
business for the purchase of inventory, including deferred purchases
of inventory;
(h) intercompany Debt described in Section 10.5(l);
(i) other unsecured Debt of the Parent or any Restricted
Subsidiary to Persons (other than the Parent or any Subsidiary)(other
than the type of Debt permitted under Subsections (e) and (f) hereof)
provided that (i) the aggregate amount thereof plus the aggregate
amount of Debt outstanding which is permitted by Section 10.2(b) shall
not exceed U.S. $100,000,000, (ii) such Debt shall not require any
principal payment, repurchase, redemption or defeasance prior to (or
the deposit of any payment or property or sinking fund payment in
respect of), or have a maturity shorter than, 90 days after the
Maturity Date, (iii) such Debt shall be on terms no more restrictive
than those set forth in the Loan
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Documents, and (iv) such Debt shall not be incurred when a Default or
Event of Default exists or would result therefrom; and
(j) Debt under the Related Facilities, including guarantees
thereof.
For purposes of this Section 10.2, any Debt (1) which is
extended, renewed or refunded shall be deemed to have been incurred when
extended, renewed or refunded, (2) of a Person when it becomes, or is merged
into, or is consolidated with a Restricted Subsidiary or the Parent shall be
deemed to have been incurred at that time, (3) which is permitted by Section
10.2(d) and which is owing to a Restricted Subsidiary when it ceases to be a
Restricted Subsidiary shall be deemed to have been incurred at that time, (4)
of a Restricted Subsidiary which is owing to the Parent or any other Restricted
Subsidiary shall be deemed to have been incurred at the time the Parent or such
other Restricted Subsidiary disposes of such Debt to any Person other than the
Parent or a Restricted Subsidiary, and (5) which is Debt of the Parent or a
Restricted Subsidiary consisting of a reimbursement obligation in respect of a
letter of credit or similar instrument shall be deemed to be incurred when such
letter of credit or similar instrument is issued.
10.3. RESTRICTED PAYMENTS. The Parent will not directly or
indirectly, and will not permit any Restricted Subsidiary to directly or
indirectly, declare or make any dividend payment or other distribution of
Properties, cash, rights, obligations or securities on account of any shares of
any class of Capital Stock of or any partnership or other interest in the
Parent or any Subsidiary, or purchase, redeem, retire or otherwise acquire for
value (or permit any Subsidiary to do so) any shares of any class of Capital
Stock of the Parent or any Subsidiary or any warrants, rights or options to
acquire any such Capital Stock, partnership interests or other interests, now
or hereafter issued, outstanding or created (all the foregoing being herein
collectively referred to as "Restricted Payments"); provided that:
(a) the Parent and each Subsidiary may declare and make any
dividend payment or other distribution payable in common stock of the
Parent or any Subsidiary to the extent that such dividends in stock
are payable only with respect to stock of the same type or class,
(b) the Parent and each Restricted Subsidiary (if such
Preferred Stock is issued to the Parent) may pay or declare any
dividend in respect of Preferred Stock of the Parent or such
Restricted Subsidiary,
(c) any Subsidiary may declare and make a dividend or other
distribution to the Parent or any Restricted Subsidiary, provided that
no Guarantor (as defined in the U.S. Revolving Credit Agreement), may
declare and make a dividend or other distribution to any
Non-Guaranteeing Restricted Subsidiary,
(d) from and after the Closing Date the Parent may (i)
repurchase shares of its common stock and (ii) purchase, redeem or
otherwise acquire shares of Capital Stock in
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connection with the payment for the exercise of options granted to an
employee or director pursuant to an employee or director stock option
plan or withhold shares otherwise issuable upon the exercise of an
option in connection with the payment of any federal or state taxes
resulting from the exercise of any such option; provided that all such
payments pursuant to this Section 10.3(d) may not exceed U.S.
$30,000,000 in the aggregate, and
(e) from and after the Closing Date, the Parent may make
payments not to exceed an aggregate amount of U.S. $500,000 to its
shareholders required in connection with any stock split or stock
dividend with respect to its common stock in order to avoid the
issuance of fractional shares of its common stock;
(f) Xxxxxx Retail Group Inc. may make payments to the
Borrower and the Borrower may acquire the Capital Stock of Xxxxxx
Retail Group Inc., in each case pursuant to the Subscription
Agreement; and
(g) the Parent or any Restricted Subsidiary may make capital
contributions of, and deliver, Capital Stock of the Parent to any
Restricted Subsidiary to effectuate an exchange for the Exchangeable
Shares;
further provided however that prior to and after giving
effect to any such proposed dividend, distribution, purchase, redemption,
retirement or acquisition for value, no Default or Event of Default has
occurred or would exist.
10.4. MERGERS; CONSOLIDATIONS; SALE OR OTHER DISPOSITIONS OF
ALL OR SUBSTANTIALLY ALL ASSETS. The Parent will not, and will not permit any
Restricted Subsidiary to, merge, amalgamate or consolidate with or into any
other Person, or convey, transfer, lease or otherwise dispose of (whether in
one transaction or in a series of related transactions) all or substantially
all of its assets (i.e., assets which could not otherwise be disposed of
pursuant to Section 10.6) (whether now owned or hereafter acquired) to any
other Person; provided that:
(a) any Restricted Subsidiary (other than the Borrower) may
merge, amalgamate or consolidate with or into, or convey, transfer,
lease or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets to, (i)
the Borrower (provided the Borrower shall be the surviving entity of
any such merger, amalgamation or consolidation) or (ii) any Guarantor
(provided that the surviving entity shall be a Guarantor) (as defined
in the U.S. Revolving Credit Agreement);
(b) any Restricted Subsidiary (other than the Borrower) may
merge, amalgamate or consolidate with or into any Person; provided
that the surviving entity shall be a Guarantor (as defined in the U.S.
Revolving Credit Agreement), further provided that prior to and after
giving effect thereto, no Default or Event of Default has occurred or
would exist;
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(c) any Restricted Subsidiary may merge, amalgamate or
consolidate with or into or transfer all or substantially all of its
assets to the Parent (provided the Parent shall be the surviving
entity of any such merger, amalgamation or consolidation);
(d) the Parent may merge, amalgamate or consolidate with or
into any Person; provided that in the case of any such merger,
amalgamation or consolidation to which the Parent is a party, the
Parent shall be the surviving entity and, further provided that prior
to and after giving effect thereto, no Default or Event of Default has
occurred or would exist; and
(e) any Non-Guaranteeing Restricted Subsidiary may merge,
amalgamate or consolidate with or into, or convey, transfer, lease or
otherwise dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its assets to, any other
Non-Guaranteeing Restricted Subsidiary.
10.5. INVESTMENTS, LOANS AND ADVANCES. The Parent will not,
and will not permit any Restricted Subsidiary to, (i) (a) make or permit to
remain outstanding any Investment in (b) endorse, or otherwise be or become
contingently liable, directly or indirectly for the payment of money or the
obligations, stock or dividends of, (c) own, purchase or acquire any Capital
Stock, obligations, evidences of indebtedness or securities of, or any other
equity interest in (including any option, warrant or other right to acquire any
of the foregoing), or (d) make or permit to remain outstanding any capital
contribution to, any Person (other than in the Parent or a Guarantor (as
defined in the U.S. Revolving Credit Agreement)), or (ii) otherwise make,
incur, create, assume or suffer to exist any Investment in any other Person
(other than in the Parent or a Guarantor (as defined in the U.S. Revolving
Credit Agreement)), or purchase or acquire the assets of any other Person
(other than in the Parent or a Guarantor (as defined in the U.S. Revolving
Credit Agreement)) constituting a business unit (excluding, in any event, the
contingent liability of a general partner for the obligations of its
partnership arising under law due to the nature of its general partnership
interest) (collectively, "Restricted Investments"), except that:
(a) the Parent and its Restricted Subsidiaries may make or
permit to remain outstanding Restricted Investments to the extent
within the prohibitions of, and permitted by, Sections 10.4 and 10.6;
(b) the Parent or any Restricted Subsidiary may acquire and
own stock, obligations or securities received in settlement of debts
(created in the ordinary course of business) owing to the Parent or
any Restricted Subsidiary;
(c) the Parent or any Restricted Subsidiary may own, purchase
or acquire Cash Equivalents;
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(d) the Parent or any Restricted Subsidiary may permit to
remain outstanding guarantees resulting from endorsement of
instruments for collection in the ordinary course of business;
(e) the Parent and its Restricted Subsidiaries may make or
permit to remain outstanding loans to employees (not including
payments covered by subsection (f) of this Section 10.5) made in the
ordinary course of business in an aggregate amount not to exceed at
any time U.S. $4,000,000;
(f) the Parent and its Restricted Subsidiaries may make or
permit to remain outstanding payment by the Parent of premiums on life
insurance policies naming Xxxxxx Xxxxxx as insured as provided for in
that certain Split-Dollar Agreement, dated November 25, 1994, among
the Parent, Xxxxxx Xxxxxx and Xxxxx Xxxxx, as Co-Trustee, a copy of
which has been delivered to the Agent, and payment by the Parent of
premiums on similar life insurance policies naming Xxxxx Xxxxx,
Xxxxxxx Xxxxxxx and Xxxxx X. Xxxxxx as insureds;
(g) the Parent and the Restricted Subsidiaries may make or
permit to remain outstanding intercompany loans and advances which are
permitted under Section 10.2(d) hereof;
(h) the Parent and its Restricted Subsidiaries (other than
the Borrower and any Subsidiary thereof) may make or permit to remain
outstanding Investments in Unrestricted Subsidiaries; provided that
all such Investments of the Parent and its Restricted Subsidiaries
shall be subject to Section 10.19;
(i) the Parent and its Restricted Subsidiaries may make or
permit to remain additional outstanding Restricted Investments (other
than the types of Restricted Investments permitted under Subsections
(a) through (h) and (j) through (l) hereof) (including, without
limitation, Restricted Investments in Non-Guaranteeing Restricted
Subsidiaries), provided that all such Restricted Investments of the
Parent and its Restricted Subsidiaries shall not exceed in an
aggregate amount at any time 7 1/2% of Consolidated Net Worth;
provided that, prior to and immediately after making such Restricted
Investments, no Default or Event of Default has occurred and is
continuing or would exist; further provided (i) if such Restricted
Investment also constitutes an Acquisition as that term is defined
under Section 10.13, such Restricted Investment will be governed by
Section 10.13 hereof in lieu of this Section 10.5, and (ii) if such
Restricted Investment is in a Unrestricted Subsidiary, such Restricted
Investment is governed by Section 10.5(h) hereof in lieu of this
Section 10.5(i);
(j) the Parent and its Restricted Subsidiaries may make or
permit to remain outstanding Restricted Investments (excluding
Acquisitions, which shall be governed by Section 10.13) made by an
exchange of stock for stock or stock for assets;
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(k) (i) the Borrower may make Investments in Xxxxxx Retail
Group Inc. pursuant to the Subscription Agreement, (ii) the Parent may
contribute shares of its Capital Stock to Golden Moores Company
pursuant to the Combination Agreement, and (iii) Golden Moores Company
may make contributions to Xxxxxx Retail Group Inc. of Capital Stock of
the Parent pursuant to the Combination Agreement; and
(l) in connection with the closing of the Related Facilities
pursuant to the Intercompany Credit Agreements, the Borrower may make
a term loan to Xxxxxx Retail Group Inc. in the principal amount of
C$75,000,000 and Xxxxxx Retail Group Inc. may make term loans to
Golden Brand Clothing (Canada) Ltd. and Xxxxxx The Suit People Inc.
in the respective amounts of C$50,000,000 and C$25,000,000.
10.6. SALE OR OTHER DISPOSITION OF LESS THAN SUBSTANTIALLY
ALL ASSETS; SALE AND LEASEBACKS. The Parent will not, and will not permit any
Restricted Subsidiary to, sell, assign, lease, exchange, transfer or otherwise
dispose of (whether in one transaction or in a series of related transactions)
part, but less than all or substantially all, of its respective Property to any
other Person (whether now owned or hereafter acquired); provided however that:
(a) the Parent or any Restricted Subsidiary may in the
ordinary course of business dispose of Property to Persons (other than
the Parent or any Restricted Subsidiary, as to which the provisions of
Section 10.6(e) shall apply) consisting of (i) Inventory, (ii) goods
or equipment that are, in the reasonable opinion of the Parent or such
Restricted Subsidiary, obsolete or unproductive, and (iii) as to the
Parent and any Restricted Subsidiary (other than the Borrower and any
Subsidiary thereof) (except in connection with any Sale and Lease-
Back Transaction, which shall be governed solely by Subsection (c)
hereof), other assets if, after giving effect to such sale, exchange,
transfer or other disposition (1) the aggregate Fair Market Value
(without duplication) of (i) all assets of the Parent and its
Restricted Subsidiaries sold, exchanged, transferred or otherwise
disposed of (on a consolidated basis) (but excluding assets sold,
exchanged, transferred or otherwise disposed of pursuant to any other
subsection of this Section 10.6) during the period of 12 consecutive
months previously preceding such sale, exchange, transfer or other
disposition and (ii) the assets of all Restricted Subsidiaries, the
stock of which have been sold or otherwise disposed of pursuant to
this Section 10.6(a) during such 12 month period shall not exceed 5%
of Consolidated Net Worth as of the end of the fiscal quarter
immediately preceding or coinciding with such sale, exchange, transfer
or other disposition, and (2) the assets described in the foregoing
subclauses (i) and (ii) shall not have contributed more than 5% of
EBITDA for the four most recently completed fiscal quarters taken as a
single accounting period;
(b) the Parent may sell, transfer or otherwise dispose of its
common stock being held by it as treasury stock;
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(c) the Parent may enter into Sale and Lease-Back
Transactions with any Person (other than an Unrestricted Subsidiary or
a Non-Guaranteeing Restricted Subsidiary) during the period from the
Closing Date to the Maturity Date relating to sales of real property
and related fixtures and improvements in an aggregate amount
(calculated on the basis of Fair Market Value) not exceeding (i) the
sum of (A) U.S. $16,000,000 for the Fiscal Year 1998 plus (B) U.S.
$3,000,000 for each Fiscal Year thereafter, minus (ii) the aggregate
amount sold under sale-leaseback transactions previously entered into
under this Section 10.6(c);
(d) to the extent such sale, assignment, lease, exchange,
transfer or disposition is also a disposition of Properties subject to
Section 10.3, the Parent and its Restricted Subsidiaries may make such
sale, assignment, lease, exchange, transfer or disposition to the
extent permitted by Section 10.3;
(e) the Parent and its Restricted Subsidiaries may sell,
assign, lease, transfer or otherwise dispose of (whether in one
transaction or in a series of transactions) part, but less than all or
substantially all, of its respective Property to the Parent or any
other Restricted Subsidiary to the extent within the prohibitions of,
and permitted by, Section 10.4 (to the same extent in respect of all
or substantially all of its assets) and Section 10.5; and
(f) Golden Moores Company and/or Xxxxxx Retail Group Inc. may
exchange its shares of Capital Stock of the Parent in exchange for the
Exchangeable Shares pursuant to the Combination Agreement.
10.7. USE OF PROCEEDS. The Parent will not use, nor permit
the use of, all or any portion of any Loan for any purpose except as described
in Section 6 hereof.
10.8. TRANSACTIONS WITH AFFILIATES. Except as permitted in
Section 10.5(f) and except for the transactions contemplated by the
Intercompany Credit Agreements and the Subscription Agreement, the Parent will
not, and will not permit any Restricted Subsidiary to, directly or indirectly,
engage in any transaction with any Affiliate or any shareholder, officer or
director of the Parent or of any Affiliate, including, without limitation, the
purchase, sale or exchange of assets or the rendering of any service, except in
the ordinary course of business and pursuant to the reasonable requirements of
the business of the Parent or such Restricted Subsidiary, as the case may be,
and upon fair and reasonable terms that are not less favorable to the Parent or
such Restricted Subsidiary, as the case may be, than those which might be
obtained in an arm's-length transaction at the time from wholly independent and
unrelated sources.
10.9. NATURE OF BUSINESS. The Parent will not, and will not
permit any Restricted Subsidiary to, make any material change in the nature of
the business conducted by the Parent and its Restricted Subsidiaries, taken as
a whole.
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10.10. ISSUANCE AND DISPOSITION OF SHARES. The Parent will
not (i) issue or have outstanding, or permit any Restricted Subsidiary to issue
or have outstanding, any Preferred Stock or Disqualified Capital Stock, or any
warrants, options, conversion rights or other rights to subscribe for,
purchase, or acquire any Preferred Stock or Disqualified Capital Stock, (ii) or
permit any Restricted Subsidiary to, issue, sell or otherwise dispose of
options which by their terms require the Parent or any Restricted Subsidiary to
purchase or acquire any Capital Stock or other equity securities, and (iii)
permit any Restricted Subsidiary to, issue, sell or otherwise dispose of to any
Person other than the Parent or any Restricted Subsidiary, any shares of its
Capital Stock or other equity securities, or any warrants, options, conversion
rights or other rights to subscribe for, purchase, or acquire any Capital Stock
or other equity securities; provided, however, the foregoing shall not prohibit
(a) Preferred Stock of the Parent which is not Disqualified Capital Stock, (b)
the Exchangeable Shares, (c) stock options granted under employee or director
stock option plans which provide that the exercise price may be paid with
shares of the Parent's common stock or that the optionee may satisfy any
withholding tax requirements upon exercise of the option by having the Parent
withhold shares otherwise issuable upon such exercise, (d) Preferred Stock of
any Restricted Subsidiary owned by the Parent and (e) the transactions
contemplated by the Subscription Agreement. The Parent will not permit any
Restricted Subsidiary to issue or have outstanding any Capital Stock (other
than to the Parent or a Restricted Subsidiary) and will not permit any Person
(other than the Parent or a Restricted Subsidiary) to own any Capital Stock of
a Restricted Subsidiary, except for the Exchangeable Shares and directors'
qualifying shares.
10.11. ERISA. The Parent shall not and shall not permit any
ERISA Affiliate to:
(a) do any of the following, which in the aggregate would
reasonably be expected to have a Material Adverse Effect:
(i) engage in any transaction which it knows or has
reason to know could result in a civil penalty assessed
pursuant to Section 502(i) of ERISA or a tax imposed by
Section 4975 of the Code;
(ii) fail to make any payments when due to any
Multiemployer Plan that the Parent or an ERISA Affiliate may
be required to make under any agreement relating to such
Multiemployer Plan, or any law pertaining thereto;
(iii) incur withdrawal liability under ERISA with
respect to a Multiemployer Plan;
(iv) voluntarily terminate or, in the case of a
"substantial employer" as defined in Section 4001(a)(2) of
ERISA, withdraw from any Plan if such termination or
withdrawal could result in the imposition of a Lien on the
Parent or an ERISA Affiliate under Section 4068 of ERISA;
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(v) fail to make any required contribution when due
to any Plan subject to Section 412(n) of the Code that with
the passage of time would likely result in a Lien upon the
properties or assets of the Parent or an ERISA Affiliate;
(vi) adopt any amendment to a Plan, the effect of
which is to increase the "current liability" under the Plan
as defined in Section 302(d)(7) of ERISA;
(vii) act or fail to act, if, as a result thereof,
an event similar to any of those referred to in clauses (i)
to (vi) would likely occur under the applicable laws of a
foreign country; or
(b) permit any Plan subject to Title IV of ERISA to have an
accumulated funding deficiency (as defined in Section 302 of ERISA) as
of the end of any Fiscal Year of the Plan; or
(c) permit the adoption, implementation or amendment of any
unfunded deferred compensation agreement or other arrangement of a
similar nature irrespective of whether subject to the funding
requirements of ERISA which could reasonably be expected to have a
Material Adverse Effect.
10.12. DISCOUNT OR SALE OF RECEIVABLES. The Parent will not
discount or sell, nor permit any Restricted Subsidiary to discount or sell, any
of its notes receivable, receivables under leases or other accounts receivable,
other than in the ordinary course of collections of delinquent notes and
receivables, provided that, notwithstanding the foregoing, the Parent and any
Restricted Subsidiary may, in the normal course of its business, acquire such
assets and sell such assets at Fair Market Value.
10.13. ACQUISITIONS. The Parent will not, and will not permit
any Restricted Subsidiary to, acquire by purchase or merger (a) the power to
direct or cause the direction of the management and policies of any other
Person (other than the Parent or any Subsidiary), directly or indirectly,
whether through the ownership of voting securities or by contract or otherwise
or (b) more than 20% of the Capital Stock or other equity interest of any such
other Person or all or substantially all of the assets or Properties of any
such other Person (the events described in clauses (a) and (b) of this Section
10.13 herein referred to as "Acquisitions"), except that the Parent or any
Restricted Subsidiary may make such Acquisitions if:
(i) (excluding the Moores Acquisition), after giving effect
thereto, the aggregate cash consideration paid for all such
Acquisitions plus any Debt assumed or incurred in connection therewith
does not exceed an amount equal to U.S. $75,000,000 (provided,
however, such amount shall be increased to U.S. $100,000,000 so long
as the aggregate equity component of all such Acquisitions is not less
than 30% of the total consideration paid for all such Acquisitions)
(provided that, notwithstanding the limitations of Section 10.13(i),
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the Parent or any Restricted Subsidiary may participate in an exchange
of stock for stock or stock for assets with such Person, which
exchange shall be excluded from the provisions of this Section
10.13(i));
(ii) prior to and immediately after making such Acquisition,
no Default or Event of Default has occurred and is continuing or would
exist; and
(iii) in the case of the purchase of the capital stock or
other equity interest of any such other Person, such Person shall be
designated a Restricted Subsidiary.
10.14. CERTAIN FINANCIAL TESTS. (a) Consolidated Net Worth.
The Parent will not permit Consolidated Net Worth at any time to be less than
an amount equal to the sum of (i) U.S. $245,000,000 plus (ii) seventy-five
percent (75%) of cumulative positive Consolidated Net Income, from January 30,
1999 through the determination date and without deduction for losses in
Consolidated Net Income, plus (iii) fifty percent (50%) of net cash proceeds
received by the Parent or a Restricted Subsidiary in consideration for the
issuance of shares of any Capital Stock of the Parent or any Restricted
Subsidiary to any Person (other than the Parent or any Subsidiary) on or after
January 30, 1999 (excluding any proceeds from (i) any issuance resulting from
the conversion of Debt to equity and (ii) the issuance and conversion of the
Exchangeable Shares).
(b) Leverage Ratio. The Parent shall not permit the ratio of
(i) Adjusted Debt to (ii) EBITDA plus Base Rent Expense to exceed (i) during
Fiscal Year 1999, 4.75 to 1.00 and, (ii) thereafter, 4.50 to 1.00, determined
in each case on the last day of each fiscal quarterly period for the four
fiscal quarters ending on such date.
(c) Fixed Charge Ratio. The Parent shall not permit its Fixed
Charge Ratio to be less than (i) during Fiscal Year 1999, 1.30 to 1.00 , (ii)
during Fiscal Year 2000, l.35 to 1.00, and (iii) thereafter, 1.40 to 1.00,
determined in each case on the last day of each fiscal quarterly period for the
four fiscal quarters ending on such date.
(d) Current Ratio. The Parent will not permit the ratio of
Consolidated Current Assets to Consolidated Current Liabilities to be less than
1.50 to 1.00 determined on the last day of each fiscal quarterly period.
(e) Consolidated Net Worth Attributable to Foreign Assets.
The Parent will not permit the percentage of Consolidated Net Worth of the
Parent and its Restricted Subsidiaries attributable to operating assets
(exclusive of Inventory in process of, or held for, manufacture) located
outside the United States, Canada and the United Kingdom at any time to be
greater than ten percent (10%).
10.15. REGULATIONS T, U AND X. The Parent will not take or
permit, and will not permit any Subsidiary to take or permit, any action which
would involve the Agent or the Banks in
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a violation of Regulation T, Regulation U, Regulation X or any other regulation
of the Board of Governors of the Federal Reserve System or a violation of the
Securities Exchange Act of 1934, in each case as now or hereafter in effect.
10.16. STATUS. The Parent will not, and will not permit any
Subsidiary to:
(i) be or become an "investment company" or a company
"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended; or
(ii) be or become a "holding company", or a "subsidiary
company" of a "holding company", or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company", or a
"public utility" within the meaning of the Public Utility Holding
Company Act of 1935, as amended.
10.17. COMPLIANCE WITH LAWS. The Parent will not fail to
comply, nor permit any Restricted Subsidiary to fail to comply, in all material
respect with all Laws.
10.18. UNRESTRICTED SUBSIDIARIES.
(a) The Parent will not, and will not permit any Restricted
Subsidiaries to, create or otherwise designate any Subsidiary as an
Unrestricted Subsidiary or as a Restricted Subsidiary unless the terms set
forth in the definition of Unrestricted Subsidiary or Restricted Subsidiary, as
the case may be, are complied with respect to such Subsidiary.
(b) The Parent will not, and will not permit any Restricted
Subsidiary to, permit any Unrestricted Subsidiary to fail to comply with the
requirements set forth in the definition of "Unrestricted Subsidiary."
10.19. INVESTMENTS IN UNRESTRICTED SUBSIDIARIES. The sum of
the Fair Market Value of all Restricted Investments in Unrestricted
Subsidiaries permitted by Section 10.5(h) (calculated at the time of such
Investment) shall not exceed U.S.$50,000,000 in the aggregate at any time, nor
shall the same be incurred if prior to or immediately thereafter a Default or
Event of Default has occurred or would exist; provided, however, the Borrower
and its Subsidiaries shall not be permitted to make any Restricted Investments
in Unrestricted Subsidiaries. For purposes of this Section 10.19, any such
Restricted Investment to or for the benefit of a Person other than an
Unrestricted Subsidiary shall be deemed to be incurred at the time any such
Person becomes an Unrestricted Subsidiary.
10.20. NO COMMINGLING OF ASSETS, ETC. (a) Except (i) as among
the Parent and the Affiliate Guarantors and (ii) as set forth in Section
10.20(b), the Parent and each Subsidiary shall not commingle its assets with
those of any other Person and its funds and other assets shall be separately
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identified and segregated from those of any other Person. Except (i) as among
the Parent and the Affiliate Guarantors and (ii) as set forth in Section
10.20(b), the Parent and each Subsidiary shall pay from the assets of the
Parent and its Subsidiaries all liabilities, obligations and indebtedness of
any kind incurred by such Person and, except as otherwise expressly permitted
in this Agreement, shall not pay from its assets any liabilities, obligations
or indebtedness of any other Person. Except as among the Parent and the
Affiliate Guarantors, the Parent and each Subsidiary shall maintain its
corporate, financial and accounting books and records separate from those of
any other Person. Except as among the Parent and the Affiliate Guarantors, the
Parent and each Subsidiary shall indicate in such statements and records the
separateness of such Person's assets and liabilities from those of any other
Person. Except (i) as among the Parent and the Affiliate Guarantors and (ii) in
the case of registered "d.b.a." names, the Parent and each Subsidiary shall
not, at any time, hold itself out to the public (including, without limitation,
any creditors of any of its Affiliates) under the name of any other Person.
(b) The restrictions set forth in the first two sentences of
Section 10.20(a) shall not prohibit the Parent or any Subsidiary from
commingling funds and paying the liabilities of any other Person in connection
with the ordinary course of its operations, in an aggregate amount not to
exceed U.S. $1,000,000.
10.21. RESTRICTIVE AGREEMENTS. Anything herein or any other
Loan Document to the contrary notwithstanding, the Parent will not, and will
not permit any Subsidiary to, enter into, create or otherwise allow to exist
any agreement or restriction (other than a Loan Document or any "Loan Document"
as defined in the Related Facilities) that (i) prohibits or restricts the
creation or assumption of any Lien upon any Property of the Parent, the
Borrower or any Restricted Subsidiary in favor of any Person, including without
limitation the Banks, (ii) prohibits or restricts any Restricted Subsidiary
from executing any guarantee which may be required under Section 9.7 hereof,
(iii) requires any obligation of the Parent or any Subsidiary to be secured by
any Property of the Parent or any Restricted Subsidiary if any obligation of
the Parent or such Subsidiary to the Banks is secured in favor of another
Person, including without limitation the Banks, or (iv) prohibits or restricts
the ability of (A) any Restricted Subsidiary (1) to pay dividends or make other
distributions or contributions or advances to the Parent or any other
Restricted Subsidiary, (2) to repay loans and other indebtedness owing by it to
the Parent or any other Restricted Subsidiary, (3) to redeem equity interests
held by it by Parent or any other Restricted Subsidiary, or (4) to transfer any
of its assets to the Parent or any other Restricted Subsidiary, or (B) the
Parent or any other Restricted Subsidiary to make any payments required or
permitted under the Loan Documents or any Related Facility or otherwise
prohibit or restrict compliance by the Parent and the Subsidiaries thereunder.
10.22. PREPAYMENTS, ETC., OF CERTAIN DEBT. Except for
interest payments, the Parent will not, and will not permit any Subsidiary to,
directly or indirectly, pay, prepay, redeem, purchase, defease or otherwise
satisfy (in whole or in part) prior to the scheduled maturity thereof in any
manner (or make any deposit of payment or property or sinking fund payment in
respect of) any Debt of the type permitted by Section 10.2(i).
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10.23. AMENDMENT OF ACQUISITION DOCUMENTS AND INTERCOMPANY
CREDIT AGREEMENTS. Without the prior written consent of the Majority Banks,
such consent not to be unreasonably withheld or delayed, the Parent will not,
and will not permit any Subsidiary to, cancel or terminate any Acquisition
Document or Intercompany Credit Agreement or consent to or accept any
cancellation or termination thereof, or amend, modify or change in any manner
any term or condition of any Acquisition Document or Intercompany Credit
Agreement or give any consent, waiver or approval thereunder, or waive any
default under or any breach of any term or condition of any Acquisition
Document or Intercompany Credit Agreement.
11. EVENTS OF DEFAULT; REMEDIES. If any of the following events shall
occur, then the Agent shall at the request, or may with the consent, of the
Majority Banks, (i) by notice to the Borrower, declare the Commitment of each
Bank and the several obligations of each Bank to make Loans hereunder to be
terminated, whereupon the same shall forthwith terminate, and (ii) declare the
Notes and all interest accrued and unpaid thereon, and all other amounts
payable under the Notes and this Agreement, to be forthwith due and payable,
whereupon the Notes, all such interest and all such other amounts, shall become
and be forthwith due and payable without presentment, demand, protest, or
further notice of any kind (including, without limitation, notice of default,
notice of intent to accelerate and notice of acceleration), all of which are
hereby expressly waived by the Borrower, provided, however, that with respect
to any Event of Default described in Section 11.6 or 11.7 hereof, (A) the
Commitment of each Bank and the several obligations of each Bank to make Loans
hereunder shall automatically be terminated and (B) the entire unpaid principal
amount of the Notes, all interest accrued and unpaid thereon, and all such
other amounts payable under the Notes and this Agreement, shall automatically
become immediately due and payable, without presentment, demand, protest, or
any notice of any kind (including, without limitation, notice of default,
notice of intent to accelerate and notice of acceleration), all of which are
hereby expressly waived by the Borrower.
11.1. FAILURE TO PAY PRINCIPAL. The Borrower shall fail to
pay any principal of any Note when the same becomes due and payable; or
11.2. FAILURE TO PAY OTHER AMOUNTS. The Borrower shall fail
to pay interest on any Note or fees or other amounts due under any Note or this
Agreement or any other Loan Document, when the same becomes due and payable and
such failure shall remain unremedied for one (1) Business Day; or
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11.3. DEFAULT UNDER OTHER DEBT. The Parent or any Restricted
Subsidiary shall fail to pay any principal of or premium or interest on any
Debt which is outstanding in a principal amount of at least U.S. $5,000,000 in
the aggregate (or the equivalent thereof, if in a currency other than U.S.
Dollars) when the same becomes due and payable (whether by scheduled maturity,
required prepayment, acceleration, demand or otherwise), and such failure shall
continue after the applicable grace period, if any, specified in the agreement
or instrument relating to such Debt; or any other event constituting a default
(however defined) shall occur or condition shall exist under any agreement or
instrument relating to any such Debt and shall continue after the applicable
grace period, if any, specified in such agreement or instrument if the effect
of such event or condition is to accelerate, or to enable or permit the
acceleration of, the maturity of such Debt; or any such Debt shall become or be
declared to be due and payable, or required to be prepaid, or the Parent or any
Restricted Subsidiary shall be required to repurchase, redeem or defease or
offer to repurchase, redeem or defease such Debt, in each case prior to the
stated maturity thereof; or
11.4. MISREPRESENTATION OR BREACH OF WARRANTY. Any
representation or warranty made by the Parent or any Subsidiary herein or in
any other Loan Document or in any certificate, document or instrument otherwise
furnished to the Agent or the Banks in connection with this Agreement shall be
incorrect, false or misleading in any material respect when made or when deemed
made; or
11.5. VIOLATION OF COVENANTS.
(i) The Parent violates any covenant, agreement or condition
contained in Section 9.1(e), 9.2, 9.7 or in Article 10; or
(ii) The Parent or the Borrower violates any other covenant,
agreement or condition contained herein or in any other Loan Document
(other than the Parent Guaranty) to which it is a party and such
default shall continue unremedied for thirty (30) days after the
occurrence of such event; or
11.6. BANKRUPTCY AND OTHER MATTERS.
(i) The Parent or any Restricted Subsidiary shall commence a
voluntary case or other proceeding seeking liquidation, reorganization
or other relief with respect to itself or its debts under any Debtor
Law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of
it or any substantial part of its property, or shall consent to any
such relief or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced against
it, or shall make a general assignment for the benefit of creditors,
or shall fail generally to pay its debts as they become due, or shall
admit in writing its inability to pay its debts generally, or shall
take any corporate action to authorize any of the foregoing; or
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(ii) An involuntary case or other proceeding shall be
commenced against the Parent or any Restricted Subsidiary seeking
liquidation, reorganization or other relief with respect to it or its
debts under any Debtor Law or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other
proceeding shall remain undismissed and unstayed for a period of sixty
(60) days; or an order for relief under U.S. Federal Bankruptcy Law
(or a similar order under other Debtor Law) shall be entered against
the Parent or any Restricted Subsidiary; or
11.7. DISSOLUTION. Any order is entered in any proceeding
against the Parent or any Restricted Subsidiary decreeing the dissolution,
liquidation, winding-up or split-up of the Parent or any Restricted Subsidiary;
or
11.8. JUDGMENT. Any judgment or order for the payment of
money which, individually or in the aggregate, shall be in excess of 5% of Net
Worth at any time, shall be rendered against the Parent or any of its
Restricted Subsidiaries (or any combination thereof) and either (i) enforcement
proceedings shall have been commenced by any creditor upon such judgment or
order or (ii) there shall be any period of thirty (30) consecutive days during
which a stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect; or
11.9. NULLITY OF LOAN DOCUMENTS. Any Loan Document shall, at
any time after its execution and delivery and for any reason, cease to be in
full force and effect or be declared to be null and void, or the validity or
enforceability thereof shall be contested by the Parent or any Affiliate
thereof, or the Parent or any Subsidiary thereof shall deny that it has any or
any further liability or obligations under any Loan Document to which it is a
party, or the Pledge Agreement shall for any reason not grant the Agent a first
priority Lien on the collateral purported to be subject thereto; or
11.10. CHANGE OF CONTROL. (a) A Change of Control shall occur
or (b) the Parent shall cease to directly or indirectly own 100% of the issued
and outstanding shares of the Borrower, free and clear of any Lien (except in
favor of the Agent), or (c) the Pledgors, or any one of them, shall,
collectively, cease to directly own 100% of the issued and outstanding shares
of Xxxxxx Retail Group Inc. (excluding the Exchangeable Shares), or (d) Xxxxxx
Retail Group Inc., shall cease to directly or indirectly own 100% of the issued
and outstanding shares of Xxxxxx The Suit People Inc. and Golden Brand Clothing
(Canada) Ltd., free and clear of any Lien (except in favor of the Agent); or
11.11. ERISA. With respect to (a) any Future Plan (as such
term is defined in Section 9.1(g) hereof), other than a Multiemployer Plan
within the meaning of Section 4001(a)(3) of ERISA, (i) such Future Plan shall
fail to satisfy the minimum funding standard or a waiver of such standard or
extension of any amortization period is sought under Section 412 of the Code;
(ii) such Future Plan is or is proposed to be terminated and as a result
thereof liability in excess of
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U.S.$1,000,000 can be asserted under Title IV of ERISA against the Parent or
ERISA Affiliate; (iii) such Future Plan shall have an unfunded current
liability in excess of U.S.$1,000,000; or (iv) there has been a withdrawal from
any such Future Plan and as a result liability in excess of U.S.$1,000,000 can
be asserted under Section 4062(e) or 4063 of ERISA against the Parent or any
ERISA Affiliate; or (b) any Future Plan that is a Multiemployer Plan under
Section 4001(a)(3) of ERISA, such Future Plan is insolvent or in reorganization
or the Parent or an ERISA Affiliate has withdrawn, or proposes to withdraw,
either totally or partially, from such Future Plan and, in any case, the Parent
or its ERISA Affiliate might reasonably be anticipated to incur a liability
which would have a Material Adverse Effect; or (c) any Plan other than a Future
Plan, the Parent or its ERISA Affiliate could reasonably be anticipated to
incur a liability which would have a Material Adverse Effect; or
11.12. GUARANTORS; PLEDGE AGREEMENT. (i) Any Affiliate
Guarantor violates any covenant, agreement or condition contained in any
Affiliate Guaranty or any default or event of default otherwise occurs
thereunder or (ii) the Parent violates any covenant, agreement or condition
contained in the Parent Guaranty or any default or event of default otherwise
occurs thereunder or (iii) any Pledgor violates a covenant, agreement or
condition contained in the Pledge Agreement or any default or event of default
otherwise occurs thereunder; or
11.13. RELATED FACILITIES. (i) Any "Event of Default" occurs
under any Related Facility, as such term is defined therein or (ii) the U.S.
Revolving Credit Agreement is terminated or shall at any time for any reason
cease to be valid and binding or in full force and effect; or
11.14. REVOCATION OF MOORES ACQUISITION; DEFAULT THEREUNDER.
The revocation or defeasance at any time of all or any material part of the
Moores Acquisition, or any material provision of any material Acquisition
Document shall (except pursuant to the express terms thereof) at any time for
any reason cease to be valid and binding or in full force and effect, or any
party thereto shall so assert in writing, or any material provision of any
material Acquisition Document shall be declared to be null and void, or the
validity or enforceability thereof shall be contested by any party thereto or
any Governmental Authority, or any party thereto shall deny that it has any
further liability or obligation under any material Acquisition Document, or any
party to any material Acquisition Document shall default in the observance or
performance of any of the material covenants or material agreements contained
in such Acquisition Document; and, in each case, such event shall continue
unremedied (or unwaived by the Majority Banks in accordance with Section 13.18
hereof) for thirty (30) days after the occurrence of such event.
11.15. OTHER REMEDIES. In addition to and cumulative of any
rights or remedies expressly provided for in this Section 11, if any one or
more Events of Default shall have occurred, the Agent shall at the request, and
may with the consent, of the Majority Banks proceed to protect and enforce the
rights of the Banks hereunder by any appropriate proceedings as the Agent may
elect. The Agent shall at the request, and may with the consent, of the
Majority Banks also proceed either by the specific performance of any covenant
or agreement contained in this Agreement or the
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other Loan Documents or by enforcing the payment of the Notes or by enforcing
any other legal or equitable right provided under this Agreement or the other
Loan Documents or otherwise existing under any Law in favor of the holder of
the Notes. The Agent shall not, however, be under any obligation to xxxxxxxx
any assets in favor of the Borrower or any other Person or against or in
payment of any or all obligations under any Loan Document.
11.16. REMEDIES CUMULATIVE. No remedy, right or power
conferred upon the Banks is intended to be exclusive of any other remedy, right
or power given hereunder or now or hereafter existing at Law, in equity, or
otherwise, and all such remedies, rights and powers shall be cumulative.
12. THE AGENT.
12.1. APPOINTMENT, POWERS AND IMMUNITIES. Each Bank hereby
irrevocably (subject to Section 12.7) appoints and authorizes the Agent to act
as its agent under this Agreement and the other Loan Documents with such powers
and discretion as are specifically delegated to the Agent by the terms of this
Agreement and the other Loan Documents, together with such other powers as are
reasonably incidental thereto. The Agent (which term as used in this sentence
and in Section 12.5 and the first sentence of Section 12.6 hereof shall include
its affiliates and its own and its affiliates' officers, directors, employees,
and agents): (a) shall not have any duties or responsibilities except those
expressly set forth in this Agreement and shall not be a trustee or fiduciary
for any Bank; (b) shall not be responsible to the Banks for any statement,
representation, or warranty (whether written or oral) made in or in connection
with any Loan Document or any certificate or other document referred to or
provided for in, or received by any of them under, any Loan Document, or for
the value, validity, effectiveness, genuineness, enforceability, or sufficiency
of any Loan Document, or any other document referred to or provided for therein
or for any failure by any Loan Party or any other Person to perform any of its
obligations thereunder; (c) shall not be responsible for or have any duty to
ascertain, inquire into, or verify the performance or observance of any
covenants or agreements by any Person or the satisfaction of any condition or
to inspect the property (including the books and records) of any Person; (d)
shall not be required to initiate or conduct any litigation or collection
proceedings under any Loan Document; and (e) shall not be responsible for any
action taken or omitted to be taken by it under or in connection with any Loan
Document, except for its own gross negligence or willful misconduct. Without
limiting the generality of the foregoing sentence, the use of the term "agent"
in this Agreement with reference to the Agent is not intended to connote any
fiduciary or other implied (or express) obligations arising under agency
doctrine of any applicable law. Instead, such term is used merely as a matter
of market custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties. The Agent may employ
agents and attorneys-in-fact and shall not be responsible for the negligence or
misconduct of any such agents or attorneys-in-fact selected by it with
reasonable care.
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12.2. RELIANCE BY AGENT. The Agent shall be entitled to rely,
and shall be fully protected in relying, upon any certification, notice,
instrument, writing, or other communication (including, without limitation, any
thereof by telephone or telecopy) believed by it to be genuine and correct and
to have been signed, sent or made by or on behalf of the proper Person or
Persons, and upon advice and statements of legal counsel (including counsel for
the Borrower), independent accountants, and other experts selected by the
Agent. The Agent may deem and treat the payee of any Note as the holder thereof
for all purposes hereof unless and until the Agent receives and accepts an
Assignment and Acceptance executed in accordance with Section 13.11 hereof. The
Agent shall be fully justified in failing or refusing to take any action under
this Agreement or any other Loan Document unless it shall first receive such
advice or concurrence of the Majority Banks as it deems appropriate and, if it
so requests, it shall first be 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 continuing to take any such action. The Agent shall in all cases
be fully protected in acting, or in refraining from acting, under this
Agreement or any other Loan Document in accordance with a request or consent of
the Majority Banks and such request and any action taken or failure to act
pursuant thereto shall be binding upon all of the Banks. For purposes of
determining compliance with the conditions specified in Section 8.1, each Bank
that has executed this Agreement shall be deemed to have consented to, approved
or accepted or to be satisfied with, each document or other matter either sent
by the Agent to such Bank for consent, approval, acceptance or satisfaction, or
required thereunder to be consented to or approved by or acceptable or
satisfactory to the Bank.
12.3. DEFAULTS. The Agent shall not be deemed to have
knowledge or notice of the occurrence of a Default or Event of Default unless
the Agent has received written notice from a Bank or the Borrower or the Parent
specifying such Default or Event of Default and stating that such notice is a
"Notice of Default". In the event that the Agent receives such a notice of the
occurrence of a Default or Event of Default, the Agent shall give prompt notice
thereof to the Banks. The Agent shall (subject to Section 12.2 hereof) take
such action with respect to such Default or Event of Default as shall
reasonably be directed by the Majority Banks, provided that, unless and until
the Agent shall have received such directions, the Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable in the
best interest of the Banks.
12.4. RIGHTS AS BANK. With respect to its Commitment and the
Loans made by it, NationsBank (and any successor acting as Agent) in its
capacity as a Bank hereunder shall have the same rights and powers hereunder as
any other Bank and may exercise the same as though it were not acting as the
Agent, and the term "Bank" or "Banks" shall, unless the context otherwise
indicates, include the Agent in its individual capacity. NationsBank (and any
successor acting as Agent) and its affiliates may without having to account
therefor to any Bank accept deposits from, lend money to, make investments in,
provide services to, and generally engage in any kind of lending, trust, or
other business with the Parent or any of its Subsidiaries or Affiliates as if
it were not acting as Agent, and NationsBank (and any successor acting as
Agent) and its affiliates may accept fees and other consideration from the
Parent or any of its Subsidiaries or Affiliates for
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services in connection with this Agreement or otherwise without having to
account for the same to the Banks.
12.5. INDEMNIFICATION. THE BANKS AGREE TO INDEMNIFY THE AGENT
(TO THE EXTENT NOT REIMBURSED UNDER SECTION 13.12 HEREOF, BUT WITHOUT THE
OBLIGATIONS OF THE BORROWER UNDER SUCH SECTION) RATABLY IN ACCORDANCE WITH
THEIR RESPECTIVE COMMITMENTS, FOR ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES,
DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES (INCLUDING
ATTORNEYS' FEES), OR DISBURSEMENTS OF ANY KIND AND NATURE WHATSOEVER THAT MAY
BE IMPOSED ON, INCURRED BY OR ASSERTED AGAINST THE AGENT (INCLUDING BY ANY
BANK) IN ANY WAY RELATING TO OR ARISING OUT OF ANY LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED THEREBY OR ANY ACTION TAKEN OR OMITTED BY THE AGENT
UNDER ANY LOAN DOCUMENT (INCLUDING ANY OF THE FOREGOING ARISING FROM THE
NEGLIGENCE OF THE AGENT); PROVIDED THAT NO BANK SHALL BE LIABLE FOR ANY OF THE
FOREGOING TO THE EXTENT THEY ARISE FROM THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF THE PERSON TO BE INDEMNIFIED. WITHOUT LIMITATION OF THE
FOREGOING, EACH BANK AGREES TO REIMBURSE THE AGENT PROMPTLY UPON DEMAND FOR ITS
RATABLE SHARE OF ANY COSTS OR EXPENSES PAYABLE BY THE BORROWER UNDER SECTION
13.12, TO THE EXTENT THAT THE AGENT IS NOT PROMPTLY REIMBURSED FOR SUCH COSTS
AND EXPENSES BY THE BORROWER. THE AGREEMENTS CONTAINED IN THIS SECTION SHALL
SURVIVE PAYMENT IN FULL OF THE LOANS AND ALL OTHER AMOUNTS PAYABLE UNDER THIS
AGREEMENT.
12.6. NON-RELIANCE ON AGENT AND OTHER BANKS. Each Bank agrees
that it has, independently and without reliance on the Agent or any other Bank,
and based on such documents and information as it has deemed appropriate, made
its own credit analysis of the Borrower and its Subsidiaries and decision to
enter into this Agreement and that it will, independently and without reliance
upon the Agent or any other Bank, and based on such documents and information
as it shall deem appropriate at the time, continue to make its own analysis and
decisions in taking or not taking action under the Loan Documents. Except for
notices, reports, and other documents and information expressly required to be
furnished to the Banks by the Agent hereunder, the Agent shall not have any
duty or responsibility to provide any Bank with any credit or other information
concerning the affairs, financial condition, or business of the Parent or any
of its Subsidiaries or affiliates that may come into the possession of the
Agent or any of its affiliates. Each Bank acknowledges that Xxxxx & Xxxxx,
L.L.P. is acting in the transactions contemplated by the Loan Documents as
special counsel to the Agent only. Each Bank will consult with its own legal
counsel to the extent that it deems necessary in connection with the
transactions contemplated by the Loan Documents.
12.7. SUCCESSOR AGENT. The Agent may resign at any time by
giving notice thereof to the Banks and the Borrower, and may be removed at any
time with or without cause by the Majority Banks. Upon any such resignation or
removal, the Majority Banks shall have the right to appoint a successor Agent.
If no successor Agent shall have been so appointed by the Majority Banks and no
successor Agent shall have accepted such appointment within thirty (30) days
after the retiring Agent's giving of notice of resignation or the Majority
Banks' removal of the retiring Agent, then the retiring Agent may, on behalf of
the Banks, appoint a successor Agent which shall
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be a commercial bank organized under the laws of the United States of America
having combined capital and surplus of at least U.S. $500,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor, such successor
shall thereupon succeed to and become vested with all the rights, powers,
discretion, privileges, and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations hereunder. After any
retiring Agent's resignation or removal hereunder as Agent, the provisions of
this Article 12 shall continue in effect for its benefit in respect of any
actions taken or omitted to be taken by it while it was acting as Agent. If no
successor agent has accepted appointment as Agent by the date which is 30 days
following a retiring Agent's notice of resignation, the retiring Agent's
resignation shall nevertheless thereupon become effective and the Banks shall
perform all of the duties of the Agent hereunder until such time, if any, as
the Majority Banks appoint a successor agent as provided for above.
13. MISCELLANEOUS.
13.1. REPRESENTATION BY THE BANKS. Each Bank represents that
it is the present intention of such Bank, as of the date of its acquisition of
the Notes, to acquire the Notes for its account or for the account of its
Affiliates, and not with a view to the distribution or sale thereof, and,
subject to any applicable Laws, the disposition of such Bank's property shall
at all times be within its control. The Notes have not been registered under
the Securities Act of 1933, as amended (the "Securities Act"), and may not be
transferred, sold or otherwise disposed of except (a) in a registered offering
under the Securities Act; (b) pursuant to an exemption from the registration
provisions of the Securities Act; or (c) if the Securities Act shall not apply
to the Notes or the transactions contemplated by the Loan Documents. Nothing in
this Section 13.1 shall affect the characterization of the Loans and the
transactions contemplated hereunder as commercial lending transactions.
13.2. WAIVERS, ETC. No failure or delay on the part of any
Bank or the Agent in exercising any power or right hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. No course of dealing between the Parent, the Borrower and
any Bank or the Agent shall operate as a waiver of any right of any Bank or the
Agent. No modification or waiver of any provision of this Agreement, the Notes
or any other Loan Document nor consent to any departure by the Parent or the
Borrower therefrom shall in any event be effective unless the same shall be in
writing, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. No notice to or demand
on the Parent or the Borrower in any case shall entitle the Parent or the
Borrower to any other or further notice or demand in similar or other
circumstances.
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13.3. NOTICES. All notices and other communications provided
for herein shall be in writing (including telex, facsimile, or cable
communication) and shall be mailed, couriered, telecopied, telexed, cabled or
delivered addressed as follows:
If to the Borrower, to it at:
0000 Xxxxxxxx
Xxxxxxx, Xxxxx 00000
Attn: Xx. Xxxxx X. Xxxxx
with a copy to:
00000 Xxxxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xx. Xxxxx Xxxxx
and
0000, Xxx Xx. Xxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxx, Xxxxxx X0X 0X0
Attn: Xxx Xx Xxxxx
and if to any Bank or the Agent, at its Domestic Lending Office specified
opposite its name on Schedule I attached hereto, or as to the Borrower, or the
Agent, to such other address as shall be designated by such party in a written
notice to the other party and, as to each other party, at such other address as
shall be designated by such party in a written notice to the Borrower and the
Agent. All such notices and communications shall, when mailed, delivered by
courier, telecopied, telexed, transmitted, or cabled, become effective when
three (3) Business Days have elapsed after being deposited in the mail (with
first class postage prepaid and addressed as aforesaid), or when confirmed by
telex answerback, transmitted to the correct telecopier, or delivered to the
courier or the cable company, except that notices and communications from the
Borrower to the Agent shall not be effective until actually received by the
Agent.
13.4. GOVERNING LAW. EACH LOAN DOCUMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE
UNITED STATES OF AMERICA.
13.5. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS.
All representations, warranties and covenants contained herein or made in
writing by the Borrower, the Parent and its Restricted Subsidiaries in
connection herewith shall survive the execution and delivery of this Agreement
and the Notes, and will bind and inure to the benefit of the respective
successors and permitted assigns of the parties hereto, whether so expressed or
not, provided that the
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undertaking of the Banks to make Loans to the Borrower shall not inure to the
benefit of any successor or assign of the Borrower. No investigation at any
time made by or on behalf of the Banks shall diminish the Banks' right to rely
thereon.
13.6. COUNTERPARTS. This Agreement may be executed in several
counterparts, and by the parties hereto on separate counterparts, and each
counterpart, when so executed and delivered, shall constitute an original
instrument, and all such separate counterparts shall constitute but one and the
same instrument.
13.7. SEPARABILITY. Should any clause, sentence, paragraph or
section of this Agreement be judicially declared to be invalid, unenforceable
or void, such decision shall not have the effect of invalidating or voiding the
remainder of this Agreement, and the parties hereto agree that the part or
parts of this Agreement so held to be invalid, unenforceable or void will be
deemed to have been stricken herefrom and the remainder will have the same
force and effectiveness as if such part or parts had never been included
herein. Each covenant contained in this Agreement shall be construed (absent an
express contrary provision herein) as being independent of each other covenant
contained herein, and compliance with any one covenant shall not (absent such
an express contrary provision) be deemed to excuse compliance with one or more
other covenants.
13.8. DESCRIPTIVE HEADINGS. The section headings in this
Agreement have been inserted for convenience only and shall be given no
substantive meaning or significance whatsoever in construing the terms and
provisions of this Agreement.
13.9. RIGHT OF SET-OFF, ADJUSTMENTS. (a) Upon the occurrence
and during the continuance of any Event of Default, each Bank (and each of its
Affiliates) is hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by such Bank (or any of its Affiliates) to
or for the credit or the account of the Borrower against any and all of the
obligations of the Borrower now or hereafter existing under this Agreement and
the Note held by such Bank, irrespective of whether such Bank shall have made
any demand under this Agreement or such Note and although such obligations may
be unmatured. Each Bank agrees promptly to notify the Borrower after any such
set-off and application made by such Bank; provided, however, that the failure
to give such notice shall not affect the validity of such set-off and
application. The rights of each Bank under this Section 13.9 are in addition to
other rights and remedies (including, without limitation, other rights of
set-off) that such Bank may have.
(b) If any Bank (a "benefitted Bank") shall at any time
receive any payment of all or part of the Loans owing to it, or interest
thereon, or receive any collateral in respect thereof (whether voluntarily or
involuntarily, by setoff, or otherwise), in a greater proportion than any such
payment to or collateral received by any other Bank, if any, in respect of such
other Bank's Loans owing to it, or interest thereon, such benefitted Bank shall
purchase for cash from the other Banks
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a participating Interest in such portion of each such other Bank's Loans owing
to it, or shall provide such other Banks with the benefits of any such
collateral, or the proceeds thereof, as shall be necessary to cause such
benefitted Bank to share the excess payment or benefits of such collateral or
proceeds ratably with each of the Banks; provided, however, that if all or any
portion of such excess payment or benefits is thereafter recovered from such
benefitted Bank, such purchase shall be rescinded, and the purchase price and
benefits returned, to the extent of such recovery, but without interest. The
Borrower agrees that any Bank so purchasing a participation from a Bank
pursuant to this Section may, to the fullest extent permitted by law, exercise
all of its rights of payment (including the right of set-off) with respect to
such participation as fully as if such Person were the direct creditor of the
Borrower in the amount of such participation.
13.10. ASSIGNMENTS AND PARTICIPATIONS. (a) Each Bank may
assign to one or more Eligible Assignees all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Loans, its Note, and its Commitment); provided, however, that
(i) each such assignment shall be to an Eligible Assignee;
(ii) any assignment shall be in an amount necessary to
satisfy the requirements of Section 13.10(a)(v) hereof and Section
13.10(a)(ii) of the U.S. Revolving Credit Agreement;
(iii) each such assignment by a Bank shall be of a constant,
and not varying, percentage of all of its rights and obligations under
this Agreement and the Note;
(iv) the parties to such assignment shall execute and deliver
to the Agent for its acceptance an Assignment and Acceptance in the
form of Exhibit F hereto (the "Assignment and Acceptance"), together
with any Note subject to such assignment and a processing fee of U.S.
$3,500; and
(v) any such Bank shall simultaneously assign to such
Eligible Assignee a pro rata portion of its rights and obligations
under the U.S. Revolving Credit Agreement.
Upon execution, delivery, and acceptance of such Assignment and Acceptance, the
assignee thereunder shall be a party hereto and, to the extent of such
assignment, have the obligations, rights, and benefits of a Bank hereunder and
the assigning Bank shall, to the extent of such assignment, relinquish its
rights and be released from its obligations under this Agreement. Upon the
consummation of any assignment pursuant to this Section, the assignor, the
Agent and the Borrower shall make appropriate arrangements so that, if
required, new Notes are issued to the assignor and the assignee in exchange for
the surrendered Note(s). Upon receipt by the Agent of such new Note or Notes
conforming to the requirements set forth in the preceding sentences, the Agent
shall return to the Borrower such surrendered Note or Notes, marked to show
that such surrendered Note or
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Notes has (have) been replaced, renewed and extended by such new Note or Notes.
If the assignee is not incorporated under the laws of the United States of
America or a state thereof, it shall deliver to the Borrower and the Agent
certification as to exemption from deduction or withholding of Taxes in
accordance with Section 4.6.
(b) The Agent shall maintain at its address referred to in
Section 13.3 a copy of each Assignment and Acceptance delivered to and accepted
by it and a register for the recordation of the names and addresses of the
Banks and the Commitment of, and principal amount of the Loans owing to, each
Bank from time to time (the "Register"). The entries in the register shall be
conclusive and binding for all purposes, absent manifest error, and the
Borrower, the Agent and the Banks may treat each Person whose name is recorded
in the Register as a Bank hereunder for all purposes of this Agreement. The
Register shall be available for inspection by the Borrower or any Bank at any
reasonable time and from time to time on reasonable prior notice.
(c) Upon its receipt of an Assignment and Acceptance executed
by the parties thereto, together with any Note subject to such assignment and
payment of the processing fee by such assignor or assignee, the Agent shall, if
such Assignment and Acceptance has been completed and is in substantially the
form of Exhibit F hereto, (i) accept such Assignment and Acceptance, (ii)
record the information contained therein in the Register and (iii) give prompt
notice thereof to the parties thereto.
(d) Each Bank may sell participations to one or more Persons
in all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and its Loans); provided,
however, that (i) such Bank's obligations under this Agreement shall remain
unchanged, (ii) such Bank shall remain solely responsible to the other parties
hereto for the performance of such obligations, (iii) the participant shall be
entitled to the benefit of the yield protection provisions contained in Section
3.2 and the right of set-off contained in Section 13.9, provided that no
participant shall be entitled to recover under Section 3.2 an amount in excess
of the proportionate share which such participant holds of the original
aggregate principal amount hereunder to which the selling Bank would otherwise
have been entitled and (iv) the Borrower shall continue to deal solely and
directly with such Bank in connection with such Bank's rights and obligations
under this Agreement, and such Bank shall retain the sole right to enforce the
obligations of the Borrower relating to its Loans and its Note and to approve
any amendment, modification, or waiver of any provision of this Agreement
(other than amendments, modifications, or waivers decreasing the amount of
principal of or the rate at which interest is payable on such Loans or Note,
extending any scheduled principal payment date or date fixed for the payment of
interest on such Loans or Note, or extending its Commitment). The Bank selling
any such participation shall give notice thereof to the Borrower, identifying
the participant and the amount of such participation and the Agent shall also
give such notice to the Borrower in the event the Agent has knowledge thereof,
provided that such Bank and the Agent shall not be liable for the failure to
provide such notice.
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(e) Notwithstanding any other provision set forth in this
Agreement, any Bank may at any time assign or pledge all or any portion of its
rights under this Agreement, its Note and the other Loan Documents to secure
obligations of such Bank to any Federal Reserve Bank; provided that (i) no such
assignment or pledge shall relieve such Bank from its obligations hereunder and
(ii) all related costs, fees and expenses incurred by such Bank in connection
with such assignment and the reassignment back to it, free of any interests of
such assignee, shall be for the sole account of such Bank.
(f) Subject to Section 13.21, any Bank may furnish any
information concerning the Parent or any of its Subsidiaries in the possession
of such Bank from time to time to assignees and participants (including
prospective assignees and participants).
13.11. INTEREST. All agreements between the Borrower, the
Agent or any Bank, whether now existing or hereafter arising and whether
written or oral, are hereby expressly limited so that in no contingency or
event whatsoever, whether by reason of demand being made on any Note or
otherwise, shall the amount contracted for, charged, reserved or received by
the Agent or any Bank for the use, forbearance, or detention of the money to be
loaned under this Agreement or otherwise or for the payment or performance of
any covenant or obligation contained herein or in any other Loan Document
exceed the maximum amount of interest permitted to be contracted for, charged
or received under applicable law from time to time in effect or the Highest
Lawful Rate. If, as a result of any circumstances whatsoever, fulfillment by
the Borrower, the Parent or any Restricted Subsidiary of any provision hereof
or of any of such documents, at the time performance of such provision shall be
due, shall involve transcending the limit of validity prescribed by applicable
usury law or result in the Agent or Bank having or being deemed to have
contracted for, charged, reserved or received interest (or amounts deemed to be
interest) in excess of the maximum lawful rate or amount of interest allowed by
applicable law to be so contracted for, charged, reserved or received by such
Agent or Bank, then, ipso facto, the obligation to be fulfilled by the Borrower
shall be reduced to the limit of such validity, and if, from any such
circumstance, the Agent or any Bank shall ever receive interest or anything
which might be deemed interest under applicable law which would exceed the
maximum amount of interest permitted to be contracted for, charged or received
under applicable law from time to time in effect or the Highest Lawful Rate,
such amount which would be excessive interest shall be refunded to the
Borrower, or, to the extent (i) permitted by applicable law and (ii) such
excessive interest does not exceed the unpaid principal balance of the Notes
and the amounts owing on other obligations of the Borrower to the Agent or any
Bank under any Loan Document, applied to the reduction of the principal amount
owing on account of the Notes or the amounts owing on other obligations of the
Borrower to the Agent or any Bank under any Loan Document and not to the
payment of interest. All sums paid or agreed to be paid to the Agent or any
Bank for the use, forbearance, or detention of the indebtedness of the Borrower
to the Agent or any Bank shall, to the extent permitted by applicable law, be
amortized, prorated, allocated, and spread throughout the full term of such
indebtedness until payment in full of the principal thereof (including the
period of any renewal or extension thereof) so that the interest on account of
such indebtedness shall not exceed the Highest Lawful Rate. The terms and
provisions of this
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Section 13.11 shall control and supersede every other provision hereof and of
all other agreements between the Borrower and the Banks.
13.12. EXPENSES; INDEMNIFICATION. (a) The Borrower agrees to
pay within 15 days after demand all reasonable costs and expenses of the Agent
in connection with the initial syndication, preparation, execution, delivery,
modification, and amendment of (and, if a Default or Event of Default exists,
in connection with the administration of) this Agreement, the other Loan
Documents, and the other documents to be delivered hereunder, including,
without limitation, the reasonable fees and expenses of counsel for the Agent
(including the cost of internal counsel) with respect thereto and with respect
to advising the Agent as to its rights and responsibilities under the Loan
Documents. The Borrower further agrees to pay on demand all reasonable costs
and expenses of the Agent and the Banks, if any (including, without limitation,
reasonable attorneys' fees and expenses and the cost of internal counsel), in
connection with the enforcement (whether through negotiations, legal
proceedings, or otherwise) of the Loan Documents and the other documents to be
delivered hereunder.
(b) THE BORROWER AGREES TO INDEMNIFY AND HOLD HARMLESS THE
AGENT AND EACH BANK AND EACH OF THEIR AFFILIATES AND THEIR RESPECTIVE OFFICERS,
DIRECTORS, EMPLOYEES, AGENTS, AND ADVISORS (EACH, AN "INDEMNIFIED PARTY") IN
AND AGAINST ANY AND ALL CLAIMS, DAMAGES, LOSSES, LIABILITIES, COSTS, AND
EXPENSES (INCLUDING, WITHOUT LIMITATION, REASONABLE ATTORNEYS' FEES) THAT MAY
BE INCURRED BY OR ASSERTED OR AWARDED AGAINST ANY INDEMNIFIED PARTY, IN EACH
CASE ARISING OUT OF OR IN CONNECTION WITH OR BY REASON OF (INCLUDING, WITHOUT
LIMITATION, IN CONNECTION WITH ANY INVESTIGATION, LITIGATION, OR PROCEEDING OR
REPARATION OF DEFENSE IN CONNECTION THEREWITH):
(i) THE LOAN DOCUMENTS, ANY OF THE TRANSACTIONS CONTEMPLATED
HEREIN OR THE ACTUAL OR PROPOSED USE OF THE PROCEEDS OF THE LOANS, OR
(ii) THE EXECUTION AND DELIVERY OF THE DOCUMENTS RELATED TO
ANY ACQUISITION, THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED
THEREBY, OR IN CONNECTION WITH THE PURCHASE OR ATTEMPTED PURCHASE
PURSUANT TO THE TERMS OF SUCH DOCUMENTS, INCLUDING, WITHOUT
LIMITATION, DAMAGES, COSTS AND EXPENSES INCURRED BY ANY OF THE
INDEMNIFIED PARTIES IN INVESTIGATING, PREPARING FOR, DEFENDING
AGAINST, OR PROVIDING EVIDENCE, PRODUCING DOCUMENTS, OR TAKING ANY
OTHER ACTION IN RESPECT OF ANY COMMENCED OR THREATENED LITIGATION
UNDER ANY FEDERAL SECURITIES LAW OR ANY OTHER LAW OF ANY JURISDICTION
OR AT COMMON LAW WHICH IS ALLEGED TO ARISE OUT OF OR IS BASED UPON:
(A) THE CLAIMS OF ANY PERSON THAT, IN
CONNECTION WITH ANY ACQUISITION, ANY OF THE
INDEMNIFIED PARTIES HAS VIOLATED ANY
FIDUCIARY OR CONFIDENTIALITY
RESPONSIBILITIES, OR ANY REPRESENTATIONS,
WARRANTIES OR COVENANTS, EXPRESS OR
IMPLIED, MADE OR ALLEGED TO HAVE BEEN MADE
BY ANY OF THE INDEMNIFIED PARTIES, TO OR IN
FAVOR OF SUCH PERSON;
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(B) ANY UNTRUE STATEMENT OR ALLEGED UNTRUE
STATEMENT OF ANY MATERIAL FACT BY PARENT OR
ANY AFFILIATE IN ANY DOCUMENT OR SCHEDULE
FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR ANY OTHER GOVERNMENTAL
AUTHORITY;
(C) ANY OMISSION OR ALLEGED OMISSION TO STATE
ANY MATERIAL FACT REQUIRED TO BE STATED IN
ANY DOCUMENT OR SCHEDULE OR NECESSARY TO
MAKE THE STATEMENTS MADE THEREIN NOT
MISLEADING IN LIGHT OF THE CIRCUMSTANCES
UNDER WHICH MADE;
(D) ANY ACTS OR OMISSIONS, OR ALLEGED ACTS OR
OMISSIONS OF PARENT, ANY AFFILIATE OR THEIR
AGENTS RELATED TO ANY ACQUISITION, PURCHASE
OR SALE OF STOCK OR ASSETS, OR THE
FINANCING THEREOF, WHICH ARE ALLEGED TO
VIOLATE ANY FEDERAL SECURITIES LAW OR ANY
OTHER LAW OF ANY JURISDICTION APPLICABLE TO
SUCH ACQUISITION, THE PURCHASE OR SALE OF
STOCK OR ASSETS, OR THE FINANCING THEREOF;
(E) ANY WITHDRAWALS, TERMINATION OR
CANCELLATION OF ANY ACQUISITION; OR
(F) ANY OTHER CLAIMS OF ANY NATURE WHATSOEVER
ARISING FROM OR RELATED TO ANY
ACQUISITIONS;
EXCEPT TO THE EXTENT SUCH CLAIM, DAMAGE, LOSS, LIABILITY, COST, OR EXPENSE IS
FOUND IN A FINAL, NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION
TO HAVE RESULTED FROM SUCH INDEMNIFIED PARTY'S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT PROVIDED THAT IT IS THE INTENTION OF THE PARTIES HERETO THAT THE
INDEMNIFIED PARTIES BE INDEMNIFIED FOR SUCH CLAIM, DAMAGE, LOSS, LIABILITY,
COST, OR EXPENSE ARISING FROM ITS OWN NEGLIGENCE. IN THE CASE OF AN
INVESTIGATION, LITIGATION OR OTHER PROCEEDING TO WHICH THE INDEMNITY IN THIS
SECTION 13.12 APPLIES, SUCH INDEMNITY SHALL BE EFFECTIVE WHETHER OR NOT SUCH
INVESTIGATION, LITIGATION OR PROCEEDING IS BROUGHT BY THE BORROWER, ITS
DIRECTORS, SHAREHOLDERS OR CREDITORS OR AN INDEMNIFIED PARTY OR ANY OTHER
PERSON OR ANY INDEMNIFIED PARTY IS OTHERWISE A PARTY THERETO AND WHETHER OR TO
THE TRANSACTIONS CONTEMPLATED HEREBY ARE CONSUMMATED. THE BORROWER AGREES NOT
TO ASSERT ANY CLAIM AGAINST THE AGENT, ANY BANK, ANY OF THEIR AFFILIATES, OR
ANY OF THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, ATTORNEYS, AGENT'S, AND
ADVISERS, ON ANY THEORY OF LIABILITY, FOR SPECIAL, INDIRECT, CONSEQUENTIAL, OR
PUNITIVE DAMAGES ARISING OUT OF OR OTHERWISE RELATING TO THE LOAN DOCUMENTS,
ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN OR THE ACTUAL OR PROPOSED USE OF
THE PROCEEDS OF THE LOANS OR THE LETTERS OF CREDIT.
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(c) Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 13.12 shall survive the payment in full of the Loans
and all other amounts payable under this Agreement.
13.13. PAYMENTS SET ASIDE. To the extent any payments on the
Obligations or proceeds of any collateral or the proceeds of such enforcement
or setoff or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to be repaid to a
trustee, receiver or any other Person under any Debtor Law or equitable cause,
then, to the extent of such recovery, the Obligation or part thereof originally
intended to be satisfied, and all rights and remedies therefor, shall be
revived and shall continue in full force and effect, and the Agent's and the
Banks' rights, powers and remedies under this Agreement and each other Loan
Document shall continue in full force and effect, as if such payment had not
been made or such enforcement or setoff had not occurred. In such event, each
Loan Document shall be automatically reinstated and the Borrower shall take
such action as may be reasonably requested by the Agent and the Banks to effect
such reinstatement.
13.14. LOAN AGREEMENT CONTROLS. If there are any conflicts or
inconsistencies among this Agreement and any of the other Loan Documents, the
provisions of this Agreement shall prevail and control.
13.15. OBLIGATIONS SEVERAL. The obligations of each Bank
under each Loan Document to which it is a party are several, and no Bank shall
be responsible for any obligation or Commitment of any other Bank under any
Loan Document to which it is a party. Nothing contained in any Loan Document to
which it is a party, and no action taken by any Bank pursuant thereto, shall be
deemed to constitute the Banks to be a partnership, an association, a joint
venture, or any other kind of entity.
13.16. SUBMISSION TO JURISDICTION; WAIVERS. EACH OF THE
BORROWER, THE PARENT, THE AGENT AND THE BANKS IRREVOCABLY AND
UNCONDITIONALLY:
(a) SUBMITS, FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR FOR
RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, TO THE
NONEXCLUSIVE GENERAL JURISDICTION OF THE COURTS OF THE STATES OF TEXAS AND NEW
YORK, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF
TEXAS, THE COURTS OF THE UNITED STATES OF AMERICA SITTING IN NEW YORK CITY, AND
APPELLATE COURTS FROM ANY THEREOF;
(b) WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER
HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT
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OR THAT SUCH PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND
AGREES NOT TO PLEAD OR CLAIM THE SAME;
(c) AGREES THAT SERVICE OF PROCESS IN ANY SUCH LEGAL ACTION
OR PROCEEDING MAY BE EFFECTED BY MAILING OF A COPY THEREOF (BY REGISTERED OR
CERTIFIED MAIL OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL POSTAGE PREPAID) TO
THE ADDRESS SET FORTH IN SECTION 13.3 HEREOF OR AT SUCH OTHER ADDRESS OF WHICH
THE OTHER PARTIES HERETO SHALL HAVE BEEN NOTIFIED IN WRITING PURSUANT TO
SECTION 13.3; AND
(d) NOTWITHSTANDING THE FOREGOING, NOTHING HEREIN SHALL IN
ANY WAY AFFECT THE RIGHT OF THE AGENT OR ANY BANK OR THE PARENT OR THE BORROWER
TO BRING ANY ACTION ARISING OUT OF OR RELATING TO THE NOTES OR THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT IN ANY COMPETENT COURT ELSEWHERE HAVING JURISDICTION
OVER THE BORROWER, THE PARENT, THE AGENT OR ANY BANK, AS THE CASE MAY BE, OR
ITS PROPERTY.
13.17. WAIVER OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, THE BORROWER AND THE PARENT (A) WAIVES ANY RIGHT TO A TRIAL
BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS
AGREEMENT OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED
OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM
ANY BANKING RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT, AND AGREES
THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE
A JURY; (B) IRREVOCABLY WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW,
ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER ANY SPECIAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES, OR DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL
DAMAGES; AND (C) CERTIFIES THAT NO PARTY HERETO NOR ANY REPRESENTATIVE OR AGENT
OF COUNSEL FOR ANY PARTY HERETO HAS REPRESENTED, EXPRESSLY OR OTHERWISE, OR
IMPLIED THAT SUCH PARTY WOULD NOT SEEK TO ENFORCE THE FOREGOING WAIVERS.
13.18. AMENDMENTS, ETC. No amendment or waiver of any
provision of this Agreement, any Note or any other Loan Document, nor consent
to any departure by the Parent, the Borrower or any Subsidiary herefrom or
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Parent, the Borrower or such Subsidiary, as the case may be,
as to amendments, and by the Majority Banks in all cases, and then, in any
case, such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given; provided, however, that no
amendment, waiver or consent shall, unless in writing and signed by 100% of the
Banks, do any of the following: (a) change the definition of "Majority Banks",
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"Commitment", or "Pro Rata Percentage", (b) forgive or reduce or increase the
amount of the Commitment of any Bank or subject any Bank to any additional
obligations, (c) forgive or reduce the principal of, or rate or amount of
interest applicable to, any Loan, other than as provided in this Agreement, (d)
postpone any date fixed for any payment or prepayment of principal of, or
interest on, the Notes, (e) change Section 13.15 or this Section 13.18, (f)
change the aggregate unpaid principal amount of the Notes, or the number of
Banks, which shall be required for the Banks or any of them to take any action
hereunder, (g) waive any of the conditions specified in Section 8.1 or Section
8.2, or (h) except as otherwise provided herein, release all or substantially
all of any collateral or release the Parent from its obligations under the
Parent Guaranty or any Affiliate Guarantor for its obligations under the
Affiliate Guaranty; and provided further that no amendment, waiver or consent
shall, unless in writing and signed by the Agent in addition to the Banks
required above to take such action, affect the rights or duties of the Agent
under this Agreement, any Note or any other Loan Document.
13.19. RELATIONSHIP OF THE PARTIES. This Agreement provides
for the making of loans by the Banks, in their capacity as Banks, to the
Borrower, in its capacity as a borrower, and for the payment of interest and
repayment of principal by the Borrower to the Banks. The relationship between
the Banks and the Borrower is limited to that of creditors/secured parties, on
the one hand, and debtor, on the other hand. The provisions herein for
compliance with financial, environmental, and other covenants, delivery of
financial, environmental and other reports, and financial, environmental and
other inspections, investigations, audits, examinations or tests are intended
solely for the benefit of the Banks to protect their interests as Banks in
assuming payments of interest and repayment of principal and nothing contained
in this Agreement or the Notes shall be construed as permitting or obligating
the Banks to act as financial or business advisors or consultants to the Parent
or the Borrower, as permitting or obligating the Banks to control the Parent or
the Borrower or to conduct or operate the Parent's or the Borrower's
operations, as creating any fiduciary obligation on the part of the Banks to
the Parent or the Borrower, or as creating any joint venture, agency, or other
relationship between the parties other than as explicitly and specifically
stated in this Agreement. The Parent and the Borrower each acknowledges that it
has had the opportunity to obtain the advice of experienced counsel of its own
choosing in connection with the negotiation and execution of this Agreement and
to obtain the advice of such counsel with respect to all matters contained
herein, including, without limitation, the provision in Section 13.17 for
waiver of trial by jury. The Parent and the Borrower each further acknowledges
that it is experienced with respect to financial and credit matters and has
made its own independent decision to apply to the Banks for the financial
accommodations provided hereby and to execute and deliver this Agreement.
13.20. CURRENCY CONVERSION AND CURRENCY INDEMNITY. (a)
Payments in Agreed Currency. The Borrower shall make payment relative to each
Loan in the currency (the "Agreed Currency") in which the Loan was effected. If
any payment is received on account of any Loan in any currency (the "Other
Currency") other than the Agreed Currency (whether voluntarily or pursuant to
an order or judgment or the enforcement thereof or the realization of any
security or the
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liquidation of the Borrower or otherwise howsoever), such payment shall
constitute a discharge of the liability of the Borrower hereunder and under the
other Loan Documents in respect of such obligation only to the extent of the
amount of the Agreed Currency which the relevant Bank or the Agent, as the case
may be, is able to purchase with the amount of the Other Currency received by
it on the Business Day next following such receipt in accordance with its
normal procedures and after deducting any premium and costs of exchange.
(b) Conversion of Agreed Currency into Judgment Currency. If,
for the purpose of obtaining or enforcing judgment in any court in any
jurisdiction, it becomes necessary to convert into a particular currency (the
"Judgment Currency") any amount due in the Agreed Currency then the conversion
shall be made on the basis of the rate of exchange prevailing on the Business
Day next preceding the day on which judgment is given and in any event the
Borrower shall be obligated to pay the Agent and the Banks any deficiency in
accordance with Section 13.20(a). For the foregoing purposes "rate of exchange"
means the rate at which the relevant Bank or the Agent, as applicable, in
accordance with its normal banking procedures is able on the relevant date to
purchase the Agreed Currency with the Judgment Currency after deducting any
premium and costs of exchange.
(c) Circumstances Giving Rise to Indemnity. If (i) any Bank
or the Agent receives any payment or payments on account of the liability of
the Borrower hereunder pursuant to any judgment or order in any Other Currency,
and (ii) the amount of the Agreed Currency which the relevant Bank or the
Agent, as applicable, is able to purchase on the Business Day next following
such receipt with the proceeds of such payment or payments in accordance with
its normal procedures and after deducting any premiums and costs of exchange is
less than the amount of the Agreed Currency due in respect of such obligations
immediately prior to such judgment or order, then the Borrower on demand shall,
and the Borrower hereby agrees to, indemnify and save the Banks and the Agent
harmless from and against any loss, cost or expense arising out of or in
connection with such deficiency.
(d) Indemnity Separate Obligation. The agreement of indemnity
provided for in this Section 13.20 shall constitute an obligation separate and
independent from all other obligations contained in this Agreement, shall give
rise to a separate and independent cause of action, shall apply irrespective of
any indulgence granted by the Banks or the Agent or any of them from time to
time, and shall continue in full force and effect notwithstanding any judgment
or order for a liquidated sum in respect of an amount due hereunder or under
any judgment or order.
13.21. CONFIDENTIALITY. The Agent and each Bank agrees (on
behalf of itself and each of its Affiliates, and each of its and their
directors, officers, agents, attorneys, employees, and representatives) that it
(and each of them) will take all reasonable steps to keep confidential any
non-public information supplied to it by or at the direction of the Borrower,
the Parent or any Subsidiary so identified when delivered, provided, however,
that this restriction shall not apply to information which (a) has at the time
in question entered the public domain, (b) is required to be
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disclosed by Law (whether valid or invalid) of any Governmental Authority, (c)
is disclosed to any Affiliates, auditors, attorneys, or agents of the Agent or
such Bank, (d) is furnished to the Agent or any Bank or to any purchaser or
prospective purchaser of participations or other interests in any Loan or Loan
Document (provided each such purchaser or prospective purchase first agrees to
hold such information in confidence on the terms provided in this section), or
(d) is disclosed in the course of enforcing its rights and remedies during the
existence of an Event of Default.
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13.22. FINAL AGREEMENT. THIS WRITTEN AGREEMENT AND THE OTHER
LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
IN WITNESS WHEREOF, the parties hereto, by their respective
officers thereunto duly authorized, have executed this Agreement effective as
of February 5, 1999.
THE MEN'S WEARHOUSE, INC.
By: /s/ NEILL X. XXXXX
----------------------------------------
Name: Neill X. Xxxxx
--------------------------------------
Title: Vice President and Treasurer
-------------------------------------
90
GOLDEN MOORES FINANCE COMPANY
By: /s/ NEILL X. XXXXX
----------------------------------------
Name: Neill X. Xxxxx
--------------------------------------
Title: Treasurer
-------------------------------------
91
Commitment Pro Rata Percentage NATIONSBANK, N.A.
as a Bank and as Agent
C$13,400,000 17.87% By: /s/ XXXXXXXXX X. XXXX
-----------------------------
Name: XXXXXXXXX X. XXXX
---------------------------
Title: VICE PRESIDENT
--------------------------
92
Commitment Pro Rata Percentage BANK OF MONTREAL
C$13,400,000 17.87%
By: /s/ X.X. XXXXXXX
-----------------------------
Name: X.X. XXXXXXX
---------------------------
Title: PORTFOLIO MANAGER
--------------------------
93
Commitment Pro Rata Percentage BANKBOSTON, N.A.
C$11,000,000 14.67% By: /s/ XXXXXX X.X. XXXXX
----------------------------
Name: Xxxxxx X.X. Xxxxx
--------------------------
Title: Vice President
-------------------------
94
Commitment Pro Rata Percentage UNION BANK OF CALIFORNIA, N.A.
C$11,000,000 14.67% By: /s/ XXXXX X. CUULIFFE
----------------------------
Name: Xxxxx X. Cuuliffe
--------------------------
Title: Vice President
-------------------------
95
Commitment Pro Rata Percentage XXXXX FARGO BANK, N.A.
C$11,000,000 14.67% By: /s/ XXXXXX X. XXXXXXXX
----------------------------
Name: Xxxxxx X. Xxxxxxxx
--------------------------
Title: Senior Vice President
-------------------------
By: /s/ XXXXXXXXX X. XXXXXXX
----------------------------
Name: XXXXXXXXX X. XXXXXXX
--------------------------
Title: Vice President
-------------------------
96
Commitment Pro Rata Percentage CHASE BANK OF TEXAS, NATIONAL
ASSOCIATION
C$7,600,000 10.13% By: /s/ XXXXX X. DOLPHIN
----------------------------
Name: Xxxxx X. Dolphin
--------------------------
Title: Senior Vice President
-------------------------
97
Commitment Pro Rata Percentage FIRST UNION NATIONAL BANK
C$7,600,000 10.13% By: /s/ XXXXX X. XXXXXXXX
----------------------------
Name: Xxxxx X. Xxxxxxxx
--------------------------
Title: Senior Vice President
-------------------------
98
EXHIBIT A
TERM NOTE
C $__________ February 5, 1999
FOR VALUE RECEIVED, the undersigned, GOLDEN XXXXXX FINANCE COMPANY, an
unlimited liability company organized under the laws of the Province of Nova
Scotia, Canada (the "Borrower"), HEREBY PROMISES TO PAY to the order of
________________ (the "Bank"), on or before the Maturity Date, the principal
sum of __________ and No/100 Canadian Dollars (C $_____) in accordance with the
terms and provisions of that certain Term Credit Agreement dated as of February
5, 1999 by and among the Borrower, the Parent, NationsBank, N.A., as Agent, the
Banks, and the other parties thereto (as same may be amended, modified,
increased, supplemented and/or restated from time to time, the "Credit
Agreement"; capitalized terms used herein and not otherwise defined herein
shall have the meanings ascribed to such terms in the Credit Agreement).
The outstanding principal balance of this Note shall be due and payable on
the Maturity Date and as otherwise provided in the Credit Agreement. The
Borrower promises to pay interest on the unpaid principal balance of this Note
from the date of any Loan evidenced by this Note until the principal balance
thereof is paid in full. Interest shall accrue on the outstanding principal
balance of this Note from and including the date of any Loan evidenced by this
Note to but not including the Maturity Date at the rate or rates, and shall be
due and payable on the dates, set forth in the Credit Agreement.
Payments of principal and interest, and all amounts due with respect to
costs and expenses, shall be made in the lawful money of Canada in immediately
available funds, without deduction, set-off or counterclaim to the Agent not
later than 12:00 noon (Dallas time) on the dates on which such payments shall
become due pursuant to the terms and provisions set forth in the Credit
Agreement.
In addition to all principal and accrued interest on this Note, the
Borrower agrees to pay (a) all costs and expenses incurred by all owners and
holders of this Note in collecting this Note through any probate,
reorganization, bankruptcy or any other proceeding and (b) reasonable
attorneys' fees when and if this Note is placed in the hands of an attorney for
collection after default.
Except as otherwise specifically provided for in the Credit Agreement, the
Borrower and any and all endorsers, guarantors and sureties severally waive
grace, demand, presentment for payment, notice of dishonor or default, protest,
notice of protest, notice of intent to accelerate, notice of acceleration and
diligence in collecting and bringing of suit against any party hereto, and agree
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99
to all renewals, extensions or partial payments hereon and to any release or
substitution of security hereof, in whole or in part, with or without notice,
before or after maturity.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK AND THE UNITED STATES OF AMERICA.
IN WITNESS WHEREOF, the Borrower has caused this Note to be executed
and delivered by its officer thereunto duly authorized effective as of the date
first above written.
GOLDEN XXXXXX FINANCE COMPANY
By:
---------------------------
Name:
-------------------------
Title:
------------------------
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