1
Exhibit 4.1
CREDIT AGREEMENT
CREDIT AGREEMENT dated as of December 29, 1999, among SOVEREIGN
SPECIALTY CHEMICALS, INC., a Delaware corporation (the "BORROWER"), the banks,
financial institutions and other institutional lenders listed on the signature
pages hereof as the Initial Lenders (the "INITIAL LENDERS"), the bank listed on
the signature pages hereof as the Initial Issuing Bank (the "INITIAL ISSUING
BANK" and, together with the Initial Lenders, the "INITIAL LENDER PARTIES") and
the Swing Line Bank (as hereinafter defined), XXXXXXX LYNCH, PIERCE, XXXXXX &
XXXXX INCORPORATED ("ML&CO.") and X.X. XXXXXX SECURITIES INC. ("X.X. XXXXXX"),
each as a joint lead arranger and a joint book-running manager (each a "JOINT
LEAD ARRANGER" and a "JOINT BOOK MANAGER", as the case may be) for the
Facilities (as hereinafter defined), ML&Co., as syndication agent for the
Facilities (the "SYNDICATION AGENT"), X.X. Xxxxxx, as documentation agent for
the Facilities (the "DOCUMENTATION AGENT"), and THE CHASE MANHATTAN BANK
("CHASE"), as administrative agent (together with any successor administrative
agent appointed pursuant to Article VII, the "ADMINISTRATIVE AGENT") for the
Lender Parties (as hereinafter defined).
PRELIMINARY STATEMENTS:
(1) SSCI Investors LLC, a Delaware limited liability company ("SSCI
INVESTORS"), was organized by AEA Investors Inc., a Delaware corporation (the
"SPONSOR"), to acquire control of the Borrower.
(2) Pursuant to that certain Stock Purchase Agreement dated as of
November 24, 1999 (as such agreement may be amended from time to time in
accordance with the provisions thereof and of this Agreement, the "ACQUISITION
AGREEMENT"), between SSCI Investors and Sovereign Specialty Chemicals, L.P., a
Delaware limited partnership (the "SELLER"), SSCI Investors has agreed to
purchase at least seventy-five percent of the outstanding capital stock of the
Borrower from the Seller (the "ACQUISITION").
(3) Pursuant to that certain Indenture dated as of August 1, 1997
(as such indenture may be amended from time to time in accordance with the
provisions thereof and of this Agreement, the "SENIOR SUBORDINATED NOTE
INDENTURE"), among the Borrower, certain Subsidiaries of the Borrower and The
Bank of New York, a New York banking corporation, as trustee (the "SENIOR
SUBORDINATED NOTE TRUSTEE"), the Borrower proposes to make an offer to purchase
its 9 1/2% Senior Subordinated Notes due 2007 issued thereunder (thE "SENior
SUBORDINATED NOTES"), following the consummation of the Acquisition in
accordance with the Indenture (the "OFFER TO PURCHASE").
2
2
(4) The Borrower has requested that, immediately upon the
consummation of the Acquisition, the Lender Parties lend to the Borrower funds
to pay fees and expenses incurred in connection with the Acquisition and to
refinance certain Existing Debt (as hereinafter defined) of the Borrower and its
Subsidiaries, the Lender Parties lend to the Borrower funds to finance the
Borrower's purchase of the Senior Subordinated Notes tendered pursuant to the
Offer to Purchase, the Lender Parties lend the Borrower funds to finance the
purchase by the Borrower or its Subsidiaries of Permitted Acquisitions (as
hereinafter defined) and from time to time, the Lender Parties lend to the
Borrower and issue Letters of Credit for the account of the Borrower to provide
working capital for the Borrower and its Subsidiaries. The Lender Parties have
indicated their willingness to agree to lend such amounts on the terms and
conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the parties hereto hereby agree as
follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"ACQUISITION" has the meaning specified in the
Preliminary Statements.
"ACQUISITION AGREEMENT " has the meaning specified in
the Preliminary Statements.
"ACQUISITION DILIGENCE REPORT" means, with respect to
the Equity Interests in, or the properties and assets of, any Person
that have been or are to be purchased or otherwise acquired by the
Borrower or any of its Subsidiaries, a due diligence report on such
Person and its Subsidiaries (or the properties and assets thereof),
prepared in good faith and certified by the Chief Financial Officer
of the Borrower and approved by the Joint Lead Arrangers, which
report shall include, (i) a Consolidated pro forma closing balance
sheet of such Person and its Subsidiaries as of the date of
consummation of the related purchase or acquisition, (ii) a
Consolidated pro forma income statement of such Person and its
Subsidiaries for the most recently completed four consecutive fiscal
quarters of such Person prior to the date of consummation of the
related purchase or acquisition, (iii) an itemized schedule of the
add back adjustments (reflecting cost saving realized by such Person
(or the Borrower and its Subsidiaries) upon the date of consummation
of such transaction or which management intends to implement within
six months of such date
3
3
made to the consolidated pro forma income statement of such Person
and its Subsidiaries referred to in clause (ii) of this definition,
(iv) a calculation of the Pro Forma Consolidated EBITDA of such
Person and its Subsidiaries for the most recently completed four
consecutive fiscal quarters of such Person prior to the date of
consummation of the related purchase or acquisition and (v) a
schedule of the computations used by the Borrower in determining pro
forma compliance with the covenants contained in Section 5.04
calculated based on the financial statements most recently delivered
to the Lender Parties pursuant to Section 5.03 and as though such
acquisition had occurred at the beginning of the four quarter period
covered thereby.
"ADMINISTRATIVE AGENT" has the meaning specified in the
recital of parties to this Agreement.
"ADMINISTRATIVE AGENT'S ACCOUNT" means the account of
the Administrative Agent maintained by the Administrative Agent with
Chase at its office at Xxx Xxxxx Xxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, Account No. 000-000-000, Attention: Xxxxxxx Xxxxxxxxx (fax
number: 212-552-5777), or such other account as the Administrative
Agent shall specify in writing to the Lender Parties.
"ADVANCE" means a Term Advance, a Revolving Credit
Advance, a Swing Line Advance or a Letter of Credit Advance.
"AFFILIATE" means, as to any Person, any other Person
that, directly or indirectly, controls, is controlled by or is under
common control with such Person or is a director or officer of such
Person. For purposes of this definition, the term "control"
(including the terms "controlling", "controlled by" and "under
common control with") of a Person means the possession, direct or
indirect, of the power to direct or cause the direction of the
management and policies of such Person, whether through the
ownership of Voting Interests, by contract or otherwise.
"AGENTS" means, collectively, the Administrative Agent,
the Joint Lead Arrangers, the Joint Book Managers, the Documentation
Agent and the Syndication Agent.
"AGREEMENT VALUE" means, for each Hedge Agreement, on
any date of determination, an amount determined by the
Administrative Agent equal to: (a) in the case of a Hedge Agreement
documented pursuant to the Master Agreement (Multicurrency-Cross
Border) published by the International Swap and Derivatives
Association, Inc. (the "MASTER AGREEMENT"), the amount, if any, that
would be payable by any Loan Party or any of its Subsidiaries to its
counterparty to such Hedge Agreement, as if (i) such Hedge Agreement
was being terminated early on such date of determination, (ii) such
Loan Party or Subsidiary was the sole "Affected Party", and (iii)
the
4
4
Administrative Agent was the sole party determining such payment
amount (with the Administrative Agent making such determination
pursuant to the provisions of the form of Master Agreement); or (b)
in the case of a Hedge Agreement traded on an exchange, the
xxxx-to-market value of such Hedge Agreement, which will be the
unrealized loss on such Hedge Agreement to the Loan Party or
Subsidiary of a Loan Party party to such Hedge Agreement determined
by the Administrative Agent based on the settlement price of such
Hedge Agreement on such date of determination, or (c) in all other
cases, the xxxx-to-market value of such Hedge Agreement, which will
be the unrealized loss on such Hedge Agreement to the Loan Party or
Subsidiary of a Loan Party party to such Hedge Agreement determined
by the Administrative Agent as the amount, if any, by which (i) the
present value of the future cash flows to be paid by such Loan Party
or Subsidiary exceeds (ii) the present value of the future cash
flows to be received by such Loan Party or Subsidiary pursuant to
such Hedge Agreement; capitalized terms used and not otherwise
defined in this definition shall have the respective meanings set
forth in the above described Master Agreement.
"APPLICABLE LENDING OFFICE" means, with respect to each
Lender Party, such Lender Party's Domestic Lending Office in the
case of a Base Rate Advance and such Lender Party's Eurodollar
Lending Office in the case of a Eurodollar Rate Advance.
"APPLICABLE MARGIN" means (i) during the period from the
Effective Date until the six-month anniversary of the Effective
Date, (A) in respect of the Term A Facility or the Revolving Credit
Facility, 1.50% per annum for Base Rate Advances and 2.50% per annum
for Eurodollar Rate Advances, and (B) in respect of the Term B
Facility, 2.00% per annum for Base Rate Advances and 3.00% per annum
for Eurodollar Rate Advances; and (ii) after the six month
anniversary of the Effective Date, a percentage per annum determined
by reference to both the Total Debt/EBITDA Ratio and the Senior
Debt/EBITDA Ratio to be the higher per annum percentage indicated by
either such ratio as set forth below:
TERM A FACILITY AND REVOLVING CREDIT FACILITY
---------------------------------------------
TOTAL DEBT/EBITDA SENIOR DEBT/EBITDA EURODOLLAR MARGIN BASE RATE MARGIN
RATIO RATIO
---------------------------------------------------------------------------------------------------------
GREATER THAN OR EQUAL GREATER THAN OR EQUAL 2.50% 1.50%
TO 4.50:1 TO 3.50:1
GREATER THAN OR EQUAL GREATER THAN OR EQUAL 2.25% 1.25%
TO 4.25:1, BUT LESS TO 3.00:1, BUT LESS THAN
THAN 4.50:1 3.50:1
GREATER THAN OR EQUAL GREATER THAN OR EQUAL 2.00% 1.00%
TO 3.75:1, BUT LESS TO 2.50:1, BUT LESS THAN
THAN 4.25:1 3.00:1
LESS THAN 3.75:1 LESS THAN 2.50:1 1.75% 0.75%
5
5
TERM B FACILITY
--------------------------------------------
TOTAL DEBT/EBITDA SENIOR DEBT/EBITDA EURODOLLAR MARGIN BASE RATE MARGIN
RATIO RATIO
---------------------------------------------------------------------------------------------------------
GREATER THAN OR EQUAL GREATER THAN OR EQUAL 3.00% 2.00%
TO 4.50:1 TO 3.50:1
LESS THAN 4.50:1 LESS THAN 3.50:1 2.50% 1.50%
The Applicable Margin for each Base Rate Advance shall be determined
by reference to the Total Debt/EBITDA Ratio and the Senior
Debt/EBITDA Ratio in effect from time to time and the Applicable
Margin for each Eurodollar Rate Advance shall be determined by
reference to the Total Debt/EBITDA Ratio and the Senior Debt/EBITDA
Ratio in effect on the first day of each Interest Period for such
Advance; provided, however, that (A) no change in the Applicable
Margin shall be effective until one Business Day after the date on
which the Administrative Agent receives the financial statements
required to be delivered pursuant to Section 5.03(b) or (c) or an
Acquisition Diligence Report, as the case may be, and a certificate
of the Chief Financial Officer of the Borrower demonstrating such
ratios, and (B) the Applicable Margin shall be at the percentage in
effect when the Total Debt/EBITDA Ratio is greater than or equal to
4.50:1 for so long as the Borrower has not submitted to the
Administrative Agent the information described in Clause (A) of this
proviso as and when required under Section 5.03(b) or (c), as the
case may be.
"APPLICABLE PERCENTAGE" means (i) during the period from
the Effective Date until the six-month anniversary of the Effective
Date, 0.50% and (ii) thereafter, a percentage per annum determined
by reference to both the Total Debt/EBITDA Ratio and the Senior
Debt/EBITDA Ratio to be the higher per annum percentage indicated by
either such ratio as set forth below:
TOTAL DEBT/EBITDA RATIO SENIOR DEBT/EBITDA RATIO COMMITMENT FEE
---------------------------------------------------------------------------------------------------
GREATER THAN OR EQUAL TO 4.25:1 GREATER THAN OR EQUAL TO 3.00:1 0.50%
LESS THAN 4.25:1 LESS THAN 3.00:1 0.375%
The Applicable Percentage shall be determined by reference to the
Total Debt/EBITDA Ratio and the Senior Debt/EBITDA Ratio in effect
from time to time; provided, however, that (A) no change in the
Applicable Percentage shall be effective until one Business Day
after the date on which the Administrative Agent receives the
financial statements required to be delivered pursuant to Section
5.03(b) or (c) or an Acquisition Diligence Report, as the case may
be, and a certificate of the Chief Financial Officer of the Borrower
demonstrating such ratios, and (B) the Applicable Percentage shall
be at the percentage in effect when the Total Debt/EBITDA Ratio is
greater than or equal to 4.25:1 for so long as the Borrower has not
submitted to the Administrative Agent the
6
6
information described in Clause (A) of this proviso as and when
required under Section 5.03(b) or (c), as the case may be.
"APPROPRIATE LENDER" means, at any time, with respect to
(a) any of the Term or Revolving Credit Facilities, a Lender that
has a Commitment with respect to such Facility at such time, (b) the
Letter of Credit Facility, (i) the Issuing Bank and (ii) if the
other Revolving Credit Lenders have made Letter of Credit Advances
pursuant to Section 2.03(c) that are outstanding at such time, each
such other Revolving Credit Lender and (c) the Swing Line Facility,
(i) the Swing Line Bank and (ii) if the other Revolving Credit
Lenders have made Swing Line Advances pursuant to Section 2.02(b)
that are outstanding at such time, each such other Revolving Credit
Lender.
"APPROVED FUND" means, with respect to any Lender that
is a fund that invests in bank loans, any other fund that invests in
bank loans and is advised or managed by the same investment advisor
as such Lender or by an Affiliate of such investment advisor.
"ASSET SALE" means the sale, lease, transfer or other
disposition of any assets of the Borrower or any of its Subsidiaries
(other than any sale, lease, transfer or other disposition of assets
pursuant to clause (i), (ii), (iii), (v) and (ix) of Section
5.02(f)) which yields to the Borrower or any of its Subsidiaries (a)
at any time that any Senior Subordinated Notes remain outstanding
and contain a covenant to prepay such notes with the proceeds of
asset sales, any gross proceeds, and (b) thereafter, gross proceeds
in excess of $250,000. Any sale, lease, transfer or other
disposition of assets pursuant to clause (ix) of Section 5.02(f)
shall only be treated as an Asset Sales at the time and to the
extent such sale or other transaction closes and yields gross
proceeds to the Borrower as provided in clause (viii) of Section
5.02(f).
"ASSIGNMENT AND ACCEPTANCE" means an assignment and
acceptance entered into by a Lender Party and an Eligible Assignee,
and accepted by the Administrative Agent, in accordance with Section
8.07 and in substantially the form of Exhibit C hereto.
"AVAILABLE AMOUNT" of any Letter of Credit means, at any
time, the maximum amount available to be drawn under such Letter of
Credit at such time (assuming compliance at such time with all
conditions to drawing).
"BASE RATE" means a fluctuating interest rate per annum
in effect from time to time, which rate per annum shall at all times
be equal to the higher of:
(a) the rate of interest announced publicly by Chase
in New York, New York, from time to time, as such bank's base
rate, with the understanding
7
7
that such base rate is not necessarily the lowest rate charge
by such bank to its customers; and
(b) 1/2 of 1% per annum above the Federal Funds Rate.
"BASE RATE ADVANCE" means an Advance that bears interest
as provided in Section 2.07(a)(i).
"BORROWER" has the meaning specified in the recital of
parties to this Agreement.
"BORROWER'S ACCOUNT" means the account of the Borrower
maintained by the Borrower with Chase at its office at Xxx Xxxxx
Xxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Account No. 9102788529,
or such other account as the Borrower shall specify in writing to
the Administrative Agent.
"BORROWING" means a Term Borrowing, a Revolving Credit
Borrowing or a Swing Line Borrowing.
"BUSINESS DAY" means a day of the year on which banks
are not required or authorized by law to close in New York City or
Illinois and, if the applicable Business Day relates to any
Eurodollar Rate Advances, on which dealings are carried on in the
London interbank market.
"CAPITAL EXPENDITURES" means, for any Person for any
period, the sum of, without duplication, (a) all expenditures made,
directly or indirectly, by such Person or any of its Subsidiaries
during such period (net of any credit granted by the seller of such
assets for any assets being traded-in at the same time) for
equipment, fixed assets, real property or improvements, or for
replacements or substitutions therefor or additions thereto, that
have been or should be, in accordance with GAAP, capitalized and
reflected as additions to property, plant or equipment on a
Consolidated balance sheet of such Person or have a useful life of
more than one year plus (b), without duplication, the aggregate
principal amount of all Debt (including Obligations under
Capitalized Leases) assumed or incurred in connection with any such
expenditures, but excluding, to the extent included under clause (a)
or (b) above, the following, without duplication, (i) expenditures
made in connection with the replacement, substitution or restoration
of assets to the extent financed (x) from insurance proceeds,
indemnification payments (or similar recoveries) paid on account of
the loss of or damage to the assets being replaced or restored or
(y) with awards or compensation arising from the taking by eminent
domain, expropriation or condemnation of the assets being replaced,
(ii) any Permitted Acquisition and (iii) any other Investment
permitted under Section 5.02(g).
8
8
"CAPITALIZED LEASES" means all leases that have been or
should be capitalized in accordance with GAAP.
"CASH EQUIVALENTS" means any of the following, to the
extent owned by the Borrower or any of its Subsidiaries free and
clear of all Liens other than Liens created under the Collateral
Documents and having a maturity of not greater than one year from
the date of acquisition thereof: (a) readily marketable direct
obligations of the Government of the United States or any agency or
instrumentality thereof or obligations unconditionally guaranteed by
the full faith and credit of the Government of the United States,
(b) insured certificates of deposit of or time deposits with any
commercial bank that is a Lender Party or a member of the Federal
Reserve System or a commercial banking institution organized in a
country recognized by the United States of America, in each case,
that issues (or the parent of which issues) commercial paper rated
as described in clause (c) below, and has combined capital and
surplus of at least $500 million (or the foreign currency equivalent
thereof), (c) commercial paper issued by any corporation organized
under the laws of any State of the United States and rated at least
"Prime-1" (or the then equivalent grade) by Xxxxx'x Investors
Service, Inc. or "A-1" (or the then equivalent grade) by Standard &
Poor's, a division of The XxXxxx-Xxxx Companies, Inc., (d) any money
market deposit accounts issued or offered by any Lender Party or a
commercial banking institution described under clause (b) above and
(e) other short-term investments utilized by Foreign Subsidiaries in
accordance with normal investment practices for cash management not
exceeding a dollar equivalent amount of $1,000,000 in the aggregate
principal amount outstanding at any time.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended from time to
time.
"CERCLIS" means the Comprehensive Environmental
Response, Compensation and Liability Information System maintained
by the U.S. Environmental Protection Agency.
"CHANGE OF CONTROL" means the occurrence of any of the
following: (a) prior to an initial public offering of Equity
Interests in SSCI Investors or the Borrower, (i) the Equity
Investors shall cease to own on a fully diluted basis in the
aggregate at least a majority of the Equity Interests and Voting
Interests in SSCI Investors or (ii) SSCI Investors shall cease to
own on a fully diluted basis in the aggregate at least a majority of
the Equity Interests and Voting Interests in the Borrower; or (b)
after such an initial public offering, any Person or two or more
Persons acting in concert other than the Equity Investors shall have
acquired beneficial ownership (within the meaning of Rule 13d-3 of
the Securities and Exchange Commission under the Securities Exchange
Act of 1934), directly or indirectly, on a fully diluted basis of
Voting Interests of SSCI Investors or the
9
9
Borrower, as the case may be, (or other securities convertible into
such Voting Interests) representing 30% or more of the combined
voting power of all Voting Interests of SSCI Investors or the
Borrower; or (c) after such an initial public offering, during any
period of up to 24 consecutive months, commencing after the date of
this Agreement, individuals who at the beginning of such 24-month
period were directors of the Borrower (together with any new
directors whose election or nomination for election was approved by
a vote of 2/3 or more of the directors still in office who were
either directors at the beginning of such period or whose election
or nomination for election was previously so approved) shall cease
for any reason to constitute a majority of the board of directors of
the Borrower.
"CHASE" has the meaning specified in the recitals of
parties to this Agreement.
"COLLATERAL" means all "Collateral" referred to in the
Collateral Documents and all other property that is or is intended
to be subject to any Lien in favor of the Collateral Agent for the
benefit of the Secured Parties.
"COLLATERAL ACCOUNT" has the meaning specified in the
Security Agreement.
"COLLATERAL DOCUMENTS" means the Security Agreement, the
Mortgages and any other agreement that creates or purports to create
a Lien in favor of the Administrative Agent for the benefit of the
Secured Parties.
"COMMITMENT" means a Term Commitment, a Revolving Credit
Commitment or a Letter of Credit Commitment.
"CONFIDENTIAL INFORMATION" means information that any
Loan Party furnishes to any Agent or any Lender Party on a
confidential basis, including such information furnished pursuant to
Section 5.01(f), but does not include any such information that is
or becomes generally available to the public or that is or becomes
available to such Agent or such Lender Party from a source other
than the Loan Parties and not in breach of Section 8.10 of this
Agreement.
"CONSOLIDATED" refers to the consolidation of accounts
in accordance with GAAP.
"CONSOLIDATED NET INCOME" means, for any period, the net
income (or net loss) of any Person and its Subsidiaries for such
period, determined on a Consolidated basis but excluding for each
such period (without duplication):
(a) the income (or loss) of any other Person accrued
prior to the date on which it became a Subsidiary of such
Person or was merged into or
10
10
consolidated with such Person or any of its Subsidiaries or
all or substantially all of the property and assets of such
other Person were acquired by such Person or any of its
Subsidiaries;
(b) the income (or loss) of any other Person in which
a Person other than such Person or any of its Subsidiaries
owns or otherwise holds an Equity Interest, except to the
extent such income (or loss) shall have been received in the
form of Cash Distributions actually paid to such Person or any
of its Subsidiaries by such other Person during such period;
(c) the income of any Subsidiary of such Person to
the extent that the declaration or payment of any dividends or
other distributions of such income by such Subsidiary is not
permitted to be made or paid (whether by contract or
otherwise) on the last day of such period;
(d) any gains or losses on Hedge Agreements; and
(e) any gains or losses on foreign currency
translation adjustments;
"CONSOLIDATED NET TANGIBLE ASSETS" of any Person means,
as of any date of determination, the total assets, less goodwill and
other intangibles and less deferred tax assets, in each case as
shown on the Consolidated balance sheet of such Person and its
Subsidiaries for the most recently ended fiscal quarter for which
financial statements are available, determined on a Consolidated
basis in accordance with GAAP.
"CONTINGENT OBLIGATION" means, with respect to any
Person, any Obligation or arrangement of such Person to guarantee or
intended to guarantee any Debt, leases, dividends or other payment
Obligations ("PRIMARY OBLIGATIONS") of any other Person (the
"PRIMARY OBLIGOR") in any manner, whether directly or indirectly,
including, without limitation, (a) the direct or indirect guarantee,
endorsement (other than for collection or deposit in the ordinary
course of business), co-making, discounting with recourse or sale
with recourse by such Person of the Obligation of a primary obligor,
(b) the Obligation to make take-or-pay or similar payments, if
required, regardless of nonperformance by any other party or parties
to an agreement or (c) any Obligation of such Person, whether or not
contingent, (i) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (ii) to
advance or supply funds (A) for the purchase or payment of any such
primary obligation or (B) to maintain working capital or equity
capital of the primary obligor or otherwise to maintain the net
worth or solvency of the primary obligor, (iii) to purchase
property, assets, securities or services primarily for the purpose
of assuring the owner of any such primary obligation of the ability
of the primary obligor to make payment of such primary obligation or
(iv) otherwise to assure or hold
11
11
harmless the holder of such primary obligation against loss in
respect thereof. The amount of any Contingent Obligation shall be
deemed to be an amount equal to the stated or determinable amount of
the primary obligation in respect of which such Contingent
Obligation is made (or, if less, the maximum amount of such primary
obligation for which such Person may be liable pursuant to the terms
of the instrument evidencing such Contingent Obligation) or, if not
stated or determinable, the maximum reasonably anticipated liability
in respect thereof (assuming such Person is required to perform
thereunder), as determined by such Person in good faith.
"CONVERSION", "CONVERT" and "CONVERTED" each refer to a
conversion of Advances of one Type into Advances of the other Type
pursuant to Section 2.09 or 2.10.
"CURRENT ASSETS" of any Person means all assets of such
Person that would, in accordance with GAAP, be classified as current
assets of a company conducting a business the same as or similar to
that of such Person, after deducting adequate reserves in each case
in which a reserve is proper in accordance with GAAP.
"CURRENT LIABILITIES" of any Person means (a) all Debt
of such Person except Funded Debt, (b) all amounts of Funded Debt of
such Person required to be paid or prepaid within one year after
such date and (c) all other items (including taxes accrued as
estimated) that in accordance with GAAP would be classified as
current liabilities of such Person.
"DEBT" of any Person means, without duplication for
purposes of calculating financial ratios, (a) all indebtedness of
such Person for borrowed money, (b) all Obligations of such Person
for the deferred purchase price of property or services (other than
trade payables not overdue by more than 60 days incurred in the
ordinary course of such Person's business), (c) all Obligations of
such Person evidenced by notes, bonds, debentures or other similar
instruments, (d) all Obligations of such Person created or arising
under any conditional sale or other title retention agreement with
respect to property acquired by such Person (even though the rights
and remedies of the seller or lender under such agreement in the
event of default are limited to repossession or sale of such
property), (e) all Obligations of such Person as lessee under
Capitalized Leases, (f) all Obligations of such Person under
acceptance, letter of credit or similar facilities, (g) all
Obligations of such Person to purchase, redeem, retire, defease or
otherwise make any payment in respect of any Equity Interests in
such Person or any other Person or any warrants, rights or options
to acquire such capital stock, valued, in the case of Redeemable
Preferred Interests, at the greater of its voluntary or involuntary
liquidation preference plus accrued and unpaid dividends (excluding
any such Obligations arising after the eighth anniversary of the
Effective Date or conditioned on compliance with this Agreement),
(h) all Obligations of such Person in respect of Hedge Agreements,
valued at
12
12
the Agreement Value thereof, and (i) all indebtedness and other
payment Obligations referred to in clauses (a) through (h) above and
all Contingent Obligations of another Person secured by (or for
which the holder of such Debt has an existing right, contingent or
otherwise, to be secured by) any Lien on property (including,
without limitation, accounts and contract rights) owned by such
Person, even though such Person has not assumed or become liable for
the payment of such indebtedness or other payment Obligations. Debt
shall not include (x) accounts extended by suppliers in the ordinary
course of business on normal trade terms not overdue by more than 60
days in connection with the purchase of goods and services and (y)
notes payable with stated maturities of no more than one year from
the date of issuance in respect of the deferred payment of insurance
policy premiums in an amount not in excess of $3 million at any time
outstanding.
"DEBT FOR BORROWED MONEY" of any Person means all items
that, in accordance with GAAP, would be classified as indebtedness
on a Consolidated balance sheet of such Person.
"DECLINING LENDER" has the meaning specified in Section
2.06(b)(v).
"DEFAULT" means any Event of Default or any event that
would constitute an Event of Default but for the requirement that
notice be given or time elapse or both.
"DEFAULTED ADVANCE" means, with respect to any Lender
Party at any time, the portion of any Advance required to be made by
such Lender Party to the Borrower pursuant to Section 2.01 or 2.02
at or prior to such time that has not been made by such Lender Party
or by the Administrative Agent for the account of such Lender Party
pursuant to Section 2.02(e) as of such time. In the event that a
portion of a Defaulted Advance shall be deemed made pursuant to
Section 2.15(a), the remaining portion of such Defaulted Advance
shall be considered a Defaulted Advance originally required to be
made pursuant to Section 2.01 on the same date as the Defaulted
Advance so deemed made in part.
"DEFAULTED AMOUNT" means, with respect to any Lender
Party at any time, any amount required to be paid by such Lender
Party to any Agent or any other Lender Party hereunder or under any
other Loan Document at or prior to such time that has not been so
paid as of such time, including, without limitation, any amount
required to be paid by such Lender Party to (a) the Swing Line Bank
pursuant to Section 2.02(b) to purchase a portion of a Swing Line
Advance made by the Swing Line Bank, (b) the Issuing Bank pursuant
to Section 2.03(c) to purchase a portion of a Letter of Credit
Advance made by the Issuing Bank, (c) the Administrative Agent
pursuant to Section 2.02(e) to reimburse the Administrative
13
13
Agent for the amount of any Advance made by the Administrative Agent
for the account of such Lender Party, (d) any other Lender Party
pursuant to Section 2.13 to purchase any participation in Advances
owing to such other Lender Party and (e) any Agent or the Issuing
Bank pursuant to Section 7.05 to reimburse such Agent or the Issuing
Bank for such Lender Party's ratable share of any amount required to
be paid by the Lender Parties to such Agent or the Issuing Bank as
provided therein. In the event that a portion of a Defaulted Amount
shall be deemed paid pursuant to Section 2.15(b), the remaining
portion of such Defaulted Amount shall be considered a Defaulted
Amount originally required to be paid hereunder or under any other
Loan Document on the same date as the Defaulted Amount so deemed
paid in part.
"DEFAULTING LENDER" means, at any time, any Lender Party
that, at such time, (a) owes a Defaulted Advance or a Defaulted
Amount or (b) shall take any action or be the subject of any action
or proceeding of a type described in Section 6.01(f).
"DEFAULT TERMINATION NOTICE" has the meaning specified
in Section 2.01(e).
"DESIGNATED MATERIAL CONTRACTS" means those contracts
more specifically identified on Schedule IV hereto.
"DOCUMENTATION AGENT" has the meaning specified in the
recitals of parties to this Agreement.
"DOMESTIC LENDING OFFICE" means, with respect to any
Lender Party, the office of such Lender Party specified as its
"Domestic Lending Office" opposite its name on Schedule I hereto or
in the Assignment and Acceptance pursuant to which it became a
Lender Party, as the case may be, or such other office of such
Lender Party as such Lender Party may from time to time specify to
the Borrower and the Administrative Agent.
"DOMESTIC SUBSIDIARY" means any Subsidiary other than a
Foreign Subsidiary.
"EBITDA" means, for any period, the sum, determined on a
Consolidated basis without duplication, of (a) Consolidated Net
Income (but excluding, to the extent reflected in determining such
Consolidated Net Income (i) extraordinary gains and losses for such
period, (ii) any gain or loss associated with the sale or write-down
of assets not in the ordinary course of business, (iii) any deferred
financing costs for such period written off in connection with the
early extinguishment of Debt hereunder or under the Senior
Subordinated Notes, and (iv) any other non-cash or non-recurring
items of income or expense (other than any non-cash item of expense
requiring an accrual or reserve for future cash expense)), (b)
interest expense, (c) income tax expense, (d) depreciation expense,
(e) amortization expense, (f) expenses for which Borrower receives
payments
14
14
under indemnification agreements, (g) prepayment penalties on early
retirement of Debt, (h) consent payments with respect to Debt, (i)
management compensation expenses associated with the Transactions to
the extent paid for by Seller, (j) non-cash expenses for the
granting of stock options, (k) all management and consulting fees
(including reimbursement of expenses) paid or payable by Borrower
and its Subsidiaries to Sponsor and (l) any non-recurring charges
related to the Acquisition, any non-recurring, cash charges related
to any Permitted Acquisition in an aggregate amount during the term
of this Agreement not to exceed $5,000,000 and any non-recurring
non-cash charges related to any Permitted Acquisition by Borrower or
any Subsidiary occurring after the Closing Date in each case of the
Borrower and its Subsidiaries, determined in accordance with GAAP
for such period.
"EFFECTIVE DATE" means the first date on which the
conditions set forth in Article III shall have been satisfied.
"ELIGIBLE ASSIGNEE" means (a) with respect to any
Facility (other than the Letter of Credit Facility), (i) a Lender;
(ii) an Affiliate of a Lender; (iii) a commercial bank organized
under the laws of the United States, or any State thereof, and
having total assets in excess of $250,000,000; (iv) a savings and
loan association or savings bank organized under the laws of the
United States, or any State thereof, and having total assets in
excess of $250,000,000; (v) a commercial bank organized under the
laws of any other country that is a member of the OECD, or a
political subdivision of any such country, and having total assets
in excess of $250,000,000, so long as such bank is acting through a
branch or agency located in the United States; (vi) a finance
company, insurance company or other financial institution or fund
(whether a corporation, partnership, trust or other entity)
organized under the laws of the United States, any state thereof or
any other country that is a member of the OECD that is engaged in
making, purchasing or otherwise investing in commercial loans in the
ordinary course of its business and having total assets in excess of
$250,000,000; and (vii) any other Person approved by the
Administrative Agent and, unless a Default has occurred and is
continuing at the time any assignment is effected pursuant to
Section 8.07, the Borrower, such approval not to be unreasonably
withheld or delayed, and (b) with respect to the Letter of Credit
Facility, a Person that is an Eligible Assignee under subclause
(iii) or (v) of clause (a) of this definition and is approved by the
Administrative Agent and, unless a Default has occurred and is
continuing at the time any assignment is effected pursuant to
Section 8.07, the Borrower, such approval not to be unreasonably
withheld or delayed; provided, however, that neither any Loan Party
nor any Affiliate of a Loan Party shall qualify as an Eligible
Assignee under this definition.
"ENVIRONMENTAL ACTION" means any action, suit, demand,
demand letter, claim, notice of non-compliance or violation, notice
of liability or potential liability,
15
15
investigation, proceeding, consent order or consent agreement
relating to any Environmental Law, any Environmental Permit or
Hazardous Material or arising from alleged injury or threat to
health, safety or the environment, including, without limitation,
(a) by any governmental or regulatory authority for enforcement,
cleanup, removal, response, remedial or other actions or damages and
(b) by any governmental or regulatory authority or third party for
damages, contribution, indemnification, cost recovery, compensation
or injunctive relief.
"ENVIRONMENTAL LAW" means any Federal, state, local or
foreign statute, law, ordinance, rule, regulation, code, order,
writ, judgment, injunction or decree, or judicial or agency
interpretation, policy or guidance having the force or effect of
law, relating to pollution or protection of the environment, health,
safety or natural resources, including, without limitation, those
relating to the use, handling, transportation, treatment, storage,
disposal, release or discharge of Hazardous Materials.
"ENVIRONMENTAL PERMIT" means any permit, approval,
identification number, license or other authorization required under
any Environmental Law.
"EQUIPMENT" means all Equipment referred to in Section
1(a) of the Security Agreement.
"EQUITY INTERESTS" means, with respect to any Person,
shares of capital stock of (or other ownership or profit interests
in) such Person, warrants, options or other rights for the purchase
or other acquisition from such Person of shares of capital stock of
(or other ownership or profit interests in) such Person, securities
convertible into or exchangeable for shares of capital stock of (or
other ownership or profit interests in) such Person or warrants,
rights or options for the purchase or other acquisition from such
Person of such shares (or such other interests), and other ownership
or profit interests in such Person (including, without limitation,
partnership, member or trust interests therein), whether voting or
nonvoting, and whether or not such shares, warrants, options, rights
or other interests are authorized or otherwise existing on any date
of determination.
"EQUITY INVESTOR" means the Sponsor and its current,
former and future employees, stockholders, directors and officers
and the employees and officers of SSCI Investors and the Borrower
and its Subsidiaries, and (i) trusts for the benefit of such Persons
or the spouses, issue (including adopted issue), parents and
grandparents of such Person, (ii) entities controlled by such
Persons and (iii) in the event of the death of any such individual
Person, heirs or testamentary legatees of such Person.
16
16
"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 Person that for purposes of
Title IV of ERISA is a member of the controlled group of any Loan
Party, or under common control with any Loan Party, within the
meaning of Section 414 of the Internal Revenue Code.
"ERISA EVENT" means (a)(i) the occurrence of a
reportable event, within the meaning of Section 4043 of ERISA, with
respect to any Plan unless the 30-day notice requirement with
respect to such event has been waived by the PBGC or (ii) the
requirements of Section 4043(b) of ERISA apply with respect to a
contributing sponsor, as defined in Section 4001(a)(13) of ERISA, of
a Plan, and an event described in paragraph (9), (10), (11), (12) or
(13) of Section 4043(c) of ERISA is reasonably expected to occur
with respect to such Plan within the following 30 days; (b) the
application for a minimum funding waiver with respect to a Plan; (c)
the provision by the administrator of any Plan of a notice of intent
to terminate such Plan, pursuant to Section 4041(a)(2) of ERISA
(including any such notice with respect to a plan amendment referred
to in Section 4041(e) of ERISA); (d) the cessation of operations at
a facility of any Loan Party or any ERISA Affiliate in the
circumstances described in Section 4062(e) of ERISA; (e) the
withdrawal by any Loan Party or any ERISA Affiliate from a Multiple
Employer Plan during a plan year for which it was a substantial
employer, as defined in Section 4001(a)(2) of ERISA; (f) the
conditions for imposition of a lien under Section 302(f) of ERISA
shall have been met with respect to any Plan; (g) the adoption of an
amendment to a Plan requiring the provision of security to such Plan
pursuant to Section 307 of ERISA; or (h) the institution by the PBGC
of proceedings to terminate a Plan pursuant to Section 4042 of
ERISA, or the occurrence of any event or condition described in
Section 4042 of ERISA that constitutes grounds for the termination
of, or the appointment of a trustee to administer, such Plan.
"EUROCURRENCY LIABILITIES" has the meaning specified in
Regulation D of the Board of Governors of the Federal Reserve
System, as in effect from time to time.
"EURODOLLAR LENDING OFFICE" means, with respect to any
Lender Party, the office of such Lender Party specified as its
"Eurodollar Lending Office" opposite its name on Schedule I hereto
or in the Assignment and Acceptance pursuant to which it became a
Lender Party (or, if no such office is specified, its Domestic
Lending Office), or such other office of such Lender Party as such
Lender Party may from time to time specify to the Borrower and the
Administrative Agent.
17
17
"EURODOLLAR RATE" means, for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing, an
interest rate per annum equal to the rate per annum obtained by
dividing (a) the rate per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) appearing on Telerate Page 3750 (or any
successor page) as the London interbank offered rate for deposits in
U.S. dollars at 11:00 A.M. (London time) two Business Days before
the first day of such Interest Period for a period equal to such
Interest Period (provided that, if for any reason such rate is not
available, the term "Eurodollar Rate" shall mean, for any Interest
Period for all Eurodollar Rate Advances comprising part of the same
Borrowing, the rate per annum (rounded upwards, if necessary, to the
nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as the
London interbank offered rate for deposits in Dollars at
approximately 11:00 A.M. (London time) two Business Days prior to
the first day of such Interest Period for a term comparable to such
Interest Period; provided, however, if more than one rate is
specified on Reuters Screen LIBO Page, the applicable rate shall be
the arithmetic mean of all such rates) by (b) a percentage equal to
100% minus the Eurodollar Rate Reserve Percentage for such Interest
Period.
"EURODOLLAR RATE ADVANCE" means an Advance that bears
interest as provided in Section 2.07(a)(ii).
"EURODOLLAR RATE RESERVE PERCENTAGE" for any Interest
Period for all Eurodollar Rate Advances comprising part of the same
Borrowing means the reserve percentage applicable two Business Days
before the first day of such Interest Period under regulations
issued from time to time by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum
reserve requirement (including, without limitation, any emergency,
supplemental or other marginal reserve requirement) for a member
bank of the Federal Reserve System in New York City with respect to
liabilities or assets consisting of or including Eurocurrency
Liabilities (or with respect to any other category of liabilities
that includes deposits by reference to which the interest rate on
Eurodollar Rate Advances is determined) having a term equal to such
Interest Period.
"EVENTS OF DEFAULT" has the meaning specified in Section
6.01.
"EXCESS CASH FLOW" means, for any period,
(a) Consolidated Net Income of the Borrower and its
Subsidiaries for such period, but excluding, to the extent
reflected in determining such Consolidated Net Income (x)
depreciation expense and amortization expense, (y) all
non-cash credits and charges which are extraordinary or
non-recurring and (z) gains or losses on the sale or other
disposition of assets (other than sales of
18
18
Inventory and licenses of patents, trademarks, copyrights of
know-how, in each case, in the ordinary course of business),
to the extent added or deducted in arriving at such
Consolidated Net Income; less
(b) the sum of:
(i) scheduled payment and permanent
prepayments of the principal amount of Term Advances,
to the extent actually made, during such period
pursuant to Section 2.04(a) or (b) or Section 2.06
plus
(ii) prepayments of Revolving Credit
Borrowings to the extent of any concurrent permanent
reduction in the Revolving Credit Commitments plus
(iii) the portion of any regularly scheduled
payments with respect to Capitalized Leases allocable
to principal plus
(iv) Capital Expenditures plus
(v) cash paid in connection with any
Permitted Acquisition during such period plus
(vi) the net increase, if greater than zero,
of Current Assets over Current Liabilities of the
Borrower and its Subsidiaries from the last day of
the immediately preceding fiscal year.
"EXCLUDED TAXES" has the meaning specified in Section
2.12(a).
"EXISTING CREDIT AGREEMENT" means that certain Amended
and Restated Credit Agreement dated as of August 15, 1997, among the
Borrower and certain of the other Loan Parties, as borrowers, the
lenders party thereto and Chase, as administrative agent for such
lenders, as amended and in effect on the date hereof.
"EXISTING DEBT" means Debt of each Loan Party and its
Subsidiaries outstanding immediately before giving effect to the
consummation of the Transaction.
"EXISTING LETTERS OF CREDIT" means the standby letters
of credit issued by Chase or one or more of its affiliates under the
terms of the Existing Credit Agreement and outstanding on the
Effective Date, in each case, as more fully described on Schedule
III hereto.
19
19
"EXTRAORDINARY RECEIPT" means any cash received by or
paid to or for the account of any Person not in the ordinary course
of business, including, without limitation, tax refunds, pension
plan reversions, proceeds of insurance (including, without
limitation, any key man life insurance but excluding proceeds of
business interruption insurance to the extent such proceeds
constitute compensation for lost earnings), condemnation awards (and
payments in lieu thereof), indemnity payments and any purchase price
adjustment received in connection with any purchase agreement;
provided, however, that an Extraordinary Receipt shall not include
cash receipts received from proceeds of insurance, condemnation
awards (or payments in lieu thereof) or indemnity payments to the
extent that such proceeds, awards or payments (A) in respect of loss
or damage to equipment, fixed assets or real property are applied
(or in respect of which expenditures were previously incurred) to
replace or repair the equipment, fixed assets or real property in
respect of which such proceeds were received in accordance with the
terms of the Loan Documents, so long as such application is made
within (x) so long as any of the Senior Subordinated Notes remain
outstanding and contain a covenant to prepay such notes with the
proceeds of asset sales, 265 days and (y) thereafter, one year, in
each case, after the occurrence of such damage or loss or (B) are
received by any Person in respect of any third party claim against
such Person and applied to pay (or to reimburse such Person for its
prior payment of) such claim and the costs and expenses of such
Person with respect thereto.
"FACILITY" means the Term A Facility, the Term B
Facility, the Revolving Credit Facility, the Swing Line Facility or
the Letter of Credit Facility.
"FEDERAL FUNDS RATE" means, for any period, a
fluctuating interest rate per annum equal for each day during such
period to the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published for such day (or, if
such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average of the
quotations for such day for such transactions received by the
Administrative Agent from three Federal funds brokers of recognized
standing selected by it.
"FEE LETTER" means the fee letter dated as of the date
hereof between the Borrower and the Administrative Agent, as
amended.
"FISCAL YEAR" means a fiscal year of the Borrower and
its Consolidated Subsidiaries ending on December 31 in any calendar
year.
"FIXED CHARGE COVERAGE RATIO" means, at any date of
determination, the ratio of (a) Pro Forma Consolidated EBITDA to (b)
the sum of (i) Pro Forma Interest Expense
20
20
plus (ii) principal amounts of all Debt for Borrowed Money payable
plus (iii) the aggregate amount of all Capital Expenditures made in
cash of or by the Borrower and its Subsidiaries during the four
consecutive fiscal quarters most recently ended for which financial
statements are required to be delivered to the Lender Parties
pursuant to Section 5.03(b) or (c), as the case may be.
"FOREIGN SUBSIDIARY" means a Subsidiary organized under
the laws of a jurisdiction other than the United States or any State
thereof or the District of Columbia.
"FUNDED DEBT" of any Person means Debt in respect of the
Advances, in the case of the Borrower, and all other Debt of such
Person that by its terms matures more than one year after the date
of determination or matures within one year from such date but is
renewable or extendible, at the option of such Person, to a date
more than one year after such date or arises under a revolving
credit or similar agreement that obligates the lender or lenders to
extend credit during a period of more than one year after such date,
including, without limitation, all amounts of Funded Debt of such
Person required to be paid or prepaid within one year after the date
of determination.
"GAAP" has the meaning specified in Section 1.03.
"GUARANTIES" means the Subsidiary Guaranties.
"GUARANTORS" means the Subsidiary Guarantors.
"HAZARDOUS MATERIALS" means (a) petroleum or petroleum
products, by-products or breakdown products, radioactive materials,
asbestos-containing materials, polychlorinated biphenyls and radon
gas and (b) any other chemicals, materials or substances designated,
classified or regulated as hazardous or toxic or as a pollutant or
contaminant under any Environmental Law.
"HEDGE AGREEMENTS" means interest rate swap, cap or
collar agreements, interest rate future or option contracts,
currency swap agreements, currency future or commodity or option
contracts and other hedging agreements.
"HEDGE BANK" means any Lender Party or an Affiliate of a
Lender Party in its capacity as a party to a Secured Hedge
Agreement.
"INDEMNIFIED PARTY" has the meaning specified in Section
8.04(b).
21
21
"INFORMATION MEMORANDUM" means the information
memorandum dated December 1999 used by the Joint Lead Arrangers in
connection with the initial syndication of the Commitments.
"INITIAL EXTENSION OF CREDIT" means the earlier to occur
of the initial Borrowing and the initial issuance of a Letter of
Credit hereunder.
"INITIAL ISSUING BANK", "INITIAL LENDER PARTIES" and
"INITIAL LENDERS" each has the meaning specified in the recital of
parties to this Agreement.
"INSUFFICIENCY" means, with respect to any Plan, the
amount, if any, of its unfunded benefit liabilities, as defined in
Section 4001(a)(18) of ERISA.
"INTELLECTUAL PROPERTY" has the meaning specified in the
Security Agreement.
"INTELLECTUAL PROPERTY SECURITY AGREEMENT" has the
meaning specified in the Security Agreement.
"INTEREST COVERAGE RATIO" means, at any date of
determination, the ratio of (a) Pro Forma Consolidated EBITDA to (b)
Pro Forma Interest Expense during the four consecutive fiscal
quarters most recently ended for which financial statements are
required to be delivered to the Lender Parties pursuant to Section
5.03(b) or (c), as the case may be.
"INTEREST EXPENSE" means for any period the Consolidated
interest expense (net of interest income) of Borrower and its
Subsidiaries for such period (including all imputed interest on
Capitalized Leases, but excluding (i) amortization of fees and
expenses in connection with the Acquisition, (ii) amortization in
connection with Hedge Agreements, (iii) interest expense on deferred
compensation or customer deposits and (iv) for purposes of
calculating the Fixed Charge Coverage Ratio and the Interest
Coverage Ratio, amortization of deferred financing costs, discounts
and other non-cash interest expense).
"INTEREST PERIOD" means, for each Eurodollar Rate
Advance comprising part of the same Borrowing, the period commencing
on the date of such Eurodollar Rate Advance or the date of the
Conversion of any Base Rate Advance into such Eurodollar Rate
Advance, and ending on the last day of the period selected by the
Borrower pursuant to the provisions below and, thereafter, each
subsequent period commencing on the last day of the immediately
preceding Interest Period and ending on the last day of the period
selected by the Borrower pursuant to the provisions below. The
duration of each such Interest Period shall be, in the case of the
period until 90 days following the Effective Date, one month, and
thereafter, one, two, three or six months, as the Borrower may,
22
22
upon notice received by the Administrative Agent not later than
11:00 A.M. (New York City time) on the third Business Day prior to
the first day of such Interest Period, select; provided, however,
that:
(a) the Borrower may not select any Interest Period
with respect to any Eurodollar Rate Advance under a Facility
that ends after any principal repayment installment date for
such Facility unless, after giving effect to such selection,
the aggregate principal amount of Base Rate Advances and of
Eurodollar Rate Advances having Interest Periods that end on
or prior to such principal repayment installment date for such
Facility shall be at least equal to the aggregate principal
amount of Advances under such Facility due and payable on or
prior to such date;
(b) Interest Periods commencing on the same date for
Eurodollar Rate Advances comprising part of the same Borrowing
shall be of the same duration;
(c) whenever the last day of any Interest Period
would otherwise occur on a day other than a Business Day, the
last day of such Interest Period shall be extended to occur on
the next succeeding Business Day, provided, however, that, if
such extension would cause the last day of such Interest
Period to occur in the next following calendar month, the last
day of such Interest Period shall occur on the next preceding
Business Day; and
(d) whenever the first day of any Interest Period
occurs on a day of an initial calendar month for which there
is no numerically corresponding day in the calendar month that
succeeds such initial calendar month by the number of months
equal to the number of months in such Interest Period, such
Interest Period shall end on the last Business Day of such
succeeding calendar month.
"INTERNAL REVENUE CODE" means the Internal Revenue Code
of 1986, as amended from time to time, and the regulations
promulgated and rulings issued thereunder.
"INVENTORY" means all Inventory referred to in Section
1(b) of the Security Agreement.
"INVESTMENT" in any Person means any loan or advance to
such Person, any purchase or other acquisition of any Equity
Interests or Debt or the assets comprising a division or business
unit or a substantial part or all of the business of such Person,
any capital contribution to such Person or any other direct or
indirect investment in such Person, including, without limitation,
any acquisition by way of a merger or consolidation and any
Contingent Obligation or any arrangement pursuant to which the
23
23
investor incurs Debt of the types referred to in clause (i) of the
definition of "DEBT" in respect of such Person.
"ISSUING BANK" means Chase, in respect of the Existing
Letters of Credit, the Initial Issuing Bank and any Eligible
Assignee to which a Letter of Credit Commitment hereunder has been
assigned pursuant to Section 8.07 so long as each such Eligible
Assignee expressly agrees to perform in accordance with their terms
all of the obligations that by the terms of this Agreement are
required to be performed by it as an Issuing Bank and notifies the
Administrative Agent of its Applicable Lending Office and the amount
of its Letter of Credit Commitment (which information shall be
recorded by the Administrative Agent in the Register), for so long
as such Initial Issuing Bank or Eligible Assignee, as the case may
be, shall have a Letter of Credit Commitment.
"JOINT BOOK MANAGER" has the meaning specified in the
recitals of parties to this Agreement.
"JOINT LEAD ARRANGER" has the meaning specified in the
recitals of parties to this Agreement.
"L/C CASH COLLATERAL ACCOUNT" has the meaning specified
in the Security Agreement.
"L/C RELATED DOCUMENTS" has the meaning specified in
Section 2.04(e)(ii).
"LENDER PARTY" means any Lender, the Issuing Bank or the
Swing Line Bank.
"LENDERS" means the Initial Lenders and each Person that
shall become a Lender hereunder pursuant to Section 8.07 for so long
as such Initial Lender or Person, as the case may be, shall be a
party to this Agreement.
"LETTER OF CREDIT ADVANCE" means an advance made by the
Issuing Bank or any Revolving Credit Lender pursuant to Section
2.03(c).
"LETTER OF CREDIT AGREEMENT" has the meaning specified
in Section 2.03(a).
"LETTER OF CREDIT COMMITMENT" means, with respect to the
Issuing Bank at any time, the amount set forth opposite the Issuing
Bank's name on Schedule I hereto under the caption "Letter of Credit
Commitment" or, if the Issuing Bank has entered into one or more
Assignment and Acceptances, set forth for the Issuing Bank in the
Register maintained by the Administrative Agent pursuant to Section
8.07(d) as the Issuing Bank's "Letter of Credit Commitment", as such
amount may be reduced at or prior to such time pursuant to Section
2.05.
24
24
"LETTER OF CREDIT FACILITY" means, at any time, an
amount equal to the amount of the Issuing Bank's Letter of Credit
Commitment at such time, as such amount may be reduced at or prior
to such time pursuant to Section 2.05.
"LETTERS OF CREDIT" has the meaning specified in Section
2.01(e).
"LIEN" means any lien, security interest or other charge
or encumbrance of any kind, or any other type of preferential
arrangement, including, without limitation, the lien or retained
security title of a conditional vendor and any easement, right of
way or other encumbrance on title to real property.
"LOAN DOCUMENTS" means (a) for purposes of this
Agreement and the Notes and any amendment, supplement or
modification hereof or thereof, (i) this Agreement, (ii) the Notes,
(iii) the Guaranties, (iv) the Collateral Documents, (v) the Fee
Letter and (vi) each Letter of Credit Agreement and (b) for purposes
of the Guaranties and the Collateral Documents and for all other
purposes other than for purposes of this Agreement and the Notes,
(i) this Agreement, (ii) the Notes, (iii) the Guaranties, (iv) the
Collateral Documents, (v) the Fee Letter, (vi) each Letter of Credit
Agreement and (vii) each Secured Hedge Agreement, in each case as
amended.
"LOAN PARTIES" means the Borrower and the Guarantors.
"MANAGEMENT AGREEMENT" means the Management Agreement
dated as of December 29, 1999, among the Sponsor and the Borrower,
as amended or renewed, to the extent permitted under the Loan
Documents.
"MARGIN STOCK" has the meaning specified in Regulation
U.
"MATERIAL ADVERSE CHANGE" means any material adverse
change in the business, assets, operations, properties, financial
condition or liabilities (contingent or otherwise) of the Borrower
and its Subsidiaries taken as a whole since September 30, 1999;
provided, however, that in no event shall the Transactions,
individually or in the aggregate, be deemed a Material Adverse
Change.
"MATERIAL ADVERSE EFFECT" means a material adverse
effect on (a) the business, assets, operations, properties,
financial condition or liabilities (contingent or otherwise) of the
Borrower and its Subsidiaries taken as a whole, or (b) the rights
and remedies of any Agent or any Lender Party under any Transaction
Document; provided, however, that in no event shall the
Transactions, individually or in the aggregate, be deemed a Material
Adverse Effect.
25
25
"MATERIAL CONTRACT" means, with respect to any Person,
each contract (or group of related contracts with the same party) to
which such Person is a party involving (i) the lease under which
such Person is lessee of, or holds or operates any personal property
owned by any other party, for which the annual rental exceeds
$1,000,000, (ii) the lease under which such Person is lessor of or
permits any third party to hold or operate any property, real or
personal, for which the annual rental exceeds $1,000,000, (iii) any
joint venture or partnership agreement, (iv) the acquisition of or
disposition of stock, assets or business with a value in excess of
$1,000,000, other than in the ordinary course of business, (v) the
license, as licensee or licensor, of any patent, trademark,
copyright or know-how for which the annual license fees and other
payments thereunder exceed $1,000,000, or (vi) the Designated
Material Contracts.
"MEASUREMENT PERIOD" means, at any date of
determination, the most recently completed four consecutive Fiscal
Quarters on or immediately prior to such date.
"MORTGAGE POLICIES" has the meaning specified in Section
5.01(q).
"MORTGAGES" has the meaning specified in Section
5.01(q).
"MULTIEMPLOYER PLAN" means a multiemployer plan, as
defined in Section 4001(a)(3) of ERISA, to which any Loan Party or
any ERISA Affiliate is making or accruing an obligation to make
contributions, or has within any of the preceding five plan years
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, that (a) is maintained
for employees of any Loan Party or any ERISA Affiliate and at least
one Person other than the Loan Parties and the ERISA Affiliates or
(b) was so maintained and in respect of which any Loan Party or any
ERISA Affiliate could have liability under Section 4064 or 4069 of
ERISA in the event such plan has been or were to be terminated.
"NET CASH PROCEEDS" means, with respect to any sale,
lease, transfer or other disposition of any asset or the incurrence
or issuance of any Debt or the sale or issuance of any Equity
Interests (including, without limitation, any capital contribution)
by any Person, or any Extraordinary Receipt received by or paid to
or for the account of any Person, the aggregate amount of cash
received from time to time (whether as initial consideration or
through payment or disposition of deferred consideration) by or on
behalf of such Person in connection with such transaction after
deducting therefrom only (without duplication), the following: (a)
with respect to any asset sale, (i) the direct and indirect costs
relating to such asset sale (including sales commissions and legal,
accounting and investment banking fees) which are incurred by the
Borrower or any of its Subsidiaries, (ii) amounts applied to the
repayment of any Debt secured by a Lien on the
26
26
asset subject to such asset sale, (iii) amounts required to be paid
to any Person (other than Borrower or any Subsidiary) owning a
beneficial interest in the assets subject to the asset sale; (iv)
liabilities of the entity, or relating to the business or assets,
sold, transferred or otherwise disposed of which are retained by
Borrower or the applicable Subsidiary, (v) appropriate amounts to be
provided by Borrower or any Subsidiary, as the case may be, as a
reserve in accordance with GAAP against any liabilities specifically
associated with such asset sale and retained by Borrower or any
Subsidiary, as the case may be, after such asset sale (but upon
reversal of such reserve, any amount so reversed shall thereupon
become Net Cash Proceeds); and (vi) the amount of taxes payable in
connection with or as a result of such transaction, in each case to
the extent, but only to the extent, that the amounts so deducted
are, at the time of receipt of such cash, actually paid to a Person
that is not an Affiliate of such Person or any Loan Party or any
Affiliate of any Loan Party and are properly attributable to such
transaction or to the asset that is the subject thereof; provided,
however, that in the case of taxes that are deductible under clause
(vi) above but for the fact that, at the time of receipt of such
cash, such taxes have not been actually paid or are not then
payable, such Loan Party or such Subsidiary may deduct an amount
(the "RESERVED AMOUNT") equal to the amount reserved in accordance
with GAAP for such Loan Party's or such Subsidiary's reasonable
estimate of such taxes, other than taxes for which such Loan Party
or such Subsidiary is indemnified, provided, further, however, that,
at the time such taxes are paid, an amount equal to the amount, if
any, by which the Reserved Amount for such taxes exceeds the amount
of such taxes actually paid shall constitute "Net Cash Proceeds" of
the type for which such taxes were reserved for all purposes
hereunder; (b) with respect to any issuance of Equity Interests or
Debt, the direct costs relating to such issuance (including sale and
underwriter's commissions and legal, accounting and investment
banking fees) incurred by the Borrower or any of its Subsidiaries;
and (c) with respect to any Extraordinary Receipt, the reasonable
costs incurred by the Borrower or any of its Subsidiaries to adjust
and/or recover such Extraordinary Receipt.
"NONRATABLE ASSIGNMENT" means an assignment by a Lender
Party pursuant to Section 8.07(a) of a portion of its rights and
obligations under this Agreement, other than an assignment of a
uniform, and not a varying, percentage of all of the rights and
obligations of such Lender Party under and in respect of all of the
Facilities (other than the Letter of Credit Facility and the Swing
Line Facility).
"NOTE" means a Term Note or a Revolving Credit Note.
"NOTE PURCHASE DATE" means the date which is (a) the
earlier of (i) the date on which the Borrower pays the purchase
price for all of the Senior Subordinated Notes which are tendered
pursuant to the Offer to Purchase and (ii) the date that is 60 days
following the Effective Date or (b) such later date prior to the
date that is 90 days
27
27
following the Effective Date, as the Joint Lead Arrangers, the
Administrative Agent and the Borrower may agree.
"NOTICE OF BORROWING" has the meaning specified in
Section 2.02(a).
"NOTICE OF ISSUANCE" has the meaning specified in
Section 2.03(a).
"NOTICE OF RENEWAL" has the meaning specified in Section
2.01(e).
"NOTICE OF SWING LINE BORROWING" has the meaning
specified in Section 2.02(b).
"NOTICE OF TERMINATION" has the meaning specified in
Section 2.01(e).
"NPL" means the National Priorities List under CERCLA.
"OBLIGATION" means, with respect to any Person, any
payment, performance or other obligation of such Person of any kind,
including, without limitation, any liability of such Person on any
claim, whether or not the right of any creditor to payment in
respect of such claim is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, disputed, undisputed,
legal, equitable, secured or unsecured, and whether or not such
claim is discharged, stayed or otherwise affected by any proceeding
referred to in Section 6.01(f). Without limiting the generality of
the foregoing, the Obligations of any Loan Party under the Loan
Documents include (a) the obligation to pay principal, interest,
Letter of Credit commissions, charges, expenses, fees, attorneys'
fees and disbursements, indemnities and other amounts payable by
such Loan Party under any Loan Document and (b) the obligation of
such Loan Party to reimburse any amount in respect of any of the
foregoing that any Lender Party, in its sole discretion, may elect
to pay or advance on behalf of such Loan Party.
"OECD" means the Organization for Economic Cooperation
and Development.
"OFFER TO PURCHASE" has the meaning specified in the
Preliminary Statements.
"OFF-SITE GOODS" has the meaning specified in the
Security Agreement.
"OPEN YEAR" has the meaning specified in Section
4.01(r)(ii).
"OTHER TAXES" has the meaning specified in Section
2.12(b).
"PBGC" means the Pension Benefit Guaranty Corporation
(or any successor).
28
28
"PERMITTED ACQUISITION" means (a) any purchase or other
acquisition by the Borrower or any of its Domestic Subsidiaries of
all the Equity Interests in any other Person in a transaction
effected pursuant to, and satisfying the requirements of, Section
5.02(g)(xiii), or (b) the purchase or acquisition by an existing
Domestic Subsidiary of the Borrower, or the organization of a new
Domestic Subsidiary by the Borrower or any of its existing Domestic
Subsidiaries for the purpose of purchasing or acquiring,
substantially all the assets of any Person or division or line of
business of any Person in a transaction effected pursuant to, and
satisfying the requirements of, Section 5.02(g)(xiii).
"PERMITTED ENCUMBRANCES" means with respect to any real
property of the Borrower or any of its Subsidiaries, easements,
rights-of-way, servitudes, covenants, restrictive covenants,
encumbrances, minor defects or irregularities in title and other
similar restrictions which (a) individually or in the aggregate, do
not materially interfere with the ordinary conduct of the businesses
of Borrower or its Subsidiary at the real estate to which they
relate, (b) do not materially impair for its intended purpose the
real property to which they relate, (c) in the case of any real
property subject to a Mortgage, shall be as set forth on a schedule
to such Mortgage and (d) shall encumber only the real property to
which they relate and no other material Collateral.
"PERMITTED LIENS" means such of the following as to
which no enforcement, collection, execution, levy or foreclosure
proceeding shall have been commenced: (a) Liens for taxes,
assessments and governmental charges or levies to the extent not
required to be paid under Section 5.01(b); (b) Liens imposed by law,
such as landlord's, materialmen's, mechanics', carriers', workmen's
and repairmen's Liens and other similar Liens arising in the
ordinary course of business securing obligations that (i) either are
not overdue for a period of more than 60 days or are being contested
in good faith by appropriate proceedings and (ii) individually or
together with all other Permitted Liens outstanding on any date of
determination do not materially adversely affect the use of the
property to which they relate; (c) pledges or deposits to secure
obligations under workers' compensation laws or similar legislation
or to secure public or statutory obligations; and (d) Permitted
Encumbrances.
"PERSON" means an individual, partnership, corporation
(including a business trust), limited liability company, joint stock
company, trust, unincorporated association, joint venture or other
entity, or a government or any political subdivision or agency
thereof.
"PLAN" means a Single Employer Plan or a Multiple
Employer Plan.
"PLEDGE AGREEMENT" has the meaning specified in Section
3.01(a)(iv).
29
29
"PLEDGED DEBT" has the meaning specified in the Security
Agreement.
"POST-CLOSING PERFECTION DATE" has the meaning specified
in Section 5.01(q).
"PREFERRED INTERESTS" means, with respect to any Person,
Equity Interests issued by such Person that are entitled to a
preference or priority over any other Equity Interests issued by
such Person upon any distribution of such Person's property and
assets, whether by dividend or upon liquidation.
"PRO FORMA CONSOLIDATED EBITDA" means (a) with respect
to the Borrower at any date of determination, an amount equal to the
Consolidated EBITDA of the Borrower and its Subsidiaries for the
most recently completed Measurement Period for which the Borrower
has delivered financial statements pursuant to Section 5.03 and (b)
with respect to any other Person at any date of determination, an
amount equal to the Consolidated EBITDA of such Person and its
Subsidiaries for the most recently completed Measurement Period of
such Person prior to such date for which such Person has delivered
Consolidated financial statements for itself and its Subsidiaries in
form and scope reasonably satisfactory to the Joint Lead Arrangers;
provided that, with respect to any Permitted Acquisition or any
purchase or other acquisition of any property or assets of any
Person by the Borrower or any of its Subsidiaries pursuant to
Section 5.02(g) or any sale, lease, transfer or other disposition of
property or assets by the Borrower or any of its Subsidiaries
pursuant to Section 5.02(f) or otherwise, if the Borrower or any of
its Subsidiaries shall have purchased or otherwise acquired or shall
have sold, leased, transferred or otherwise disposed of any property
or assets at any time on or after the first day of any Measurement
Period, the Consolidated EBITDA of the Borrower and its Subsidiaries
for such Measurement Period shall be increased (in the case of each
such purchase or other acquisition) or reduced (in the case of each
such sale, lease, transfer or other disposition) by the Consolidated
EBITDA thereof that would have been contributed thereto by such
property or assets during such Measurement Period, as determined in
good faith by the Chief Financial Officer of the Borrower on a pro
forma basis as though the Borrower or the Subsidiary of the Borrower
that is effecting such transaction had purchased or otherwise
acquired or had sold, transferred or otherwise disposed of such
property or assets on the first day of such Measurement Period and
after giving effect to all of the pro forma cost savings to the
Borrower and its Subsidiaries that are to be recognized as a result
of such transaction during such Measurement Period (which, in the
case of any Permitted Acquisition, shall be those pro forma cost
savings to such Person (or the Borrower and its Subsidiaries)
realized upon the date of consummation of such transaction or which
management intends to implement within six months of the
consummation of such transaction, and which are reflected on the
itemized schedule of add-back adjustments to the Consolidated pro
forma income statement of the acquired
30
30
Person and its Subsidiaries comprising part of the Acquisition
Diligence Report on such Person and its Subsidiaries).
"PRO FORMA INCREMENTAL INTEREST EXPENSE" means, with
respect to each Permitted Acquisition, for the first three
Measurement Periods ending after the date on which such Permitted
Acquisition is consummated, the product of (A)(B)(C) where:
(A)= total cash paid plus assumed Debt in such
Permitted Acquisition;
(B)= the per annum cost of Debt used for such
Permitted Acquisition; and
(C)= a fraction, the numerator of which is 360
minus the number of days since the date of
the consummation of such Permitted
Acquisition and the denominator of which is
equal to 360.
"PRO FORMA INTEREST EXPENSE" means with respect to the
Borrower and its Subsidiaries for any Measurement Period the sum of
(a) Interest Expense for such Measurement Period plus (b) Pro Forma
Incremental Interest Expense for each Permitted Acquisition which
was consummated by the Borrower or one of its Subsidiaries during
such Measurement Period.
"PRO RATA SHARE" of any amount means, with respect to
any Lender under any Facility at any time, the product of any
applicable amount times a fraction the numerator of which is the
amount of such Lender's Commitment under such Facility at such time
(or, if the Commitments under such Facility shall have been
terminated pursuant to Section 2.05 or 6.01, such Lender's
Commitment under such Facility as in effect immediately prior to
such termination) and the denominator of which is the aggregate
Commitments under such Facility at such time (or, if the Commitments
under such Facility shall have been terminated pursuant to Section
2.05 or 6.01, the aggregate Commitments under such Facility as in
effect immediately prior to such termination).
"RECEIVABLES" means all Receivables referred to in
Section 1(c) of the Security Agreement.
"REDEEMABLE" means, with respect to any Equity Interest,
any Debt or any other right or Obligation, any such Equity Interest,
Debt, right or Obligation that (a) the issuer has undertaken to
redeem at a fixed or determinable date or dates, whether by
operation of a sinking fund or otherwise, or upon the occurrence of
a condition not solely within the control of the issuer or (b) is
redeemable at the option of the holder.
31
31
"REDEMPTION" means the Redemption as such term is
defined and used in Section 1.04 of the Acquisition Agreement.
"REGISTER" has the meaning specified in Section 8.07(d).
"REGULATION U" means Regulation U of the Board of
Governors of the Federal Reserve System, as in effect from time to
time.
"REINVESTMENT DEFERRED AMOUNT" with respect to any
Reinvestment Event, the aggregate Net Cash Proceeds received by the
Borrower or any of its Subsidiaries in connection therewith that are
not applied to prepay the Term Advances or the Revolving Credit
Advances pursuant to Section 2.06(b)(ii)(A) as a result of the
delivery of a Reinvestment Notice.
"REINVESTMENT EVENT" any Asset Sale in respect of which
the Borrower has delivered a Reinvestment Notice.
"REINVESTMENT NOTICE" a written notice executed by an
officer of the Borrower stating that no Default or Event of Default
has occurred and is continuing and that the Borrower (directly or
indirectly through a Subsidiary) intends and expects to use all or a
specified portion of the Net Cash Proceeds of an Asset Sale to
acquire assets useful in its business.
"REINVESTMENT PREPAYMENT AMOUNT" with respect to any
Reinvestment Event, the Reinvestment Deferred Amount relating
thereto less any amount expended prior to the relevant Reinvestment
Prepayment Date to acquire asset useful in the Borrower's business.
"REINVESTMENT PREPAYMENT DATE" with respect to any
Reinvestment Event, the earlier of (a) the date occurring 265 days
after such Reinvestment Event and (b) the date on which the Borrower
shall have determined not to, or shall have otherwise ceased to,
acquire assets useful in the Borrower's business with all or any
portion of the relevant Reinvestment Deferred Amount.
"RELATED DOCUMENTS" means the Acquisition Agreement, the
Shareholders Agreements, the Management Agreement, the Subordinated
Debt Documents, the documents setting forth the terms of, and
effecting, the Offer to Purchase, and any intercompany notes issued
pursuant to Section 5.02(b)(i)(B).
"REQUIRED LENDERS" means, at any time, Lenders owed or
holding at least a majority in interest of the sum of (a) the
aggregate principal amount of the Advances
32
32
outstanding at such time, (b) the aggregate Available Amount of all
Letters of Credit outstanding at such time, (c) the aggregate unused
Commitments under the Term Facilities at such time and (d) the
aggregate Unused Revolving Credit Commitments at such time;
provided, however, that if any Lender shall be a Defaulting Lender
at such time, there shall be excluded from the determination of
Required Lenders at such time (A) the aggregate principal amount of
the Advances owing to such Lender (in its capacity as a Lender) and
outstanding at such time, (B) such Lender's Pro Rata Share of the
aggregate Available Amount of all Letters of Credit outstanding at
such time, (C) the aggregate unused Term Commitments of such Lender
at such time and (D) the Unused Revolving Credit Commitment of such
Lender at such time. For purposes of this definition, the aggregate
principal amount of Swing Line Advances owing to the Swing Line Bank
and of Letter of Credit Advances owing to the Issuing Bank and the
Available Amount of each Letter of Credit shall be considered to be
owed to the Revolving Credit Lenders ratably in accordance with
their respective Revolving Credit Commitments.
"RESPONSIBLE OFFICER" means the Chairman or any officer
of any Loan Party or any of its Subsidiaries.
"REVOLVING CREDIT ADVANCE" has the meaning specified in
Section 2.01(c).
"REVOLVING CREDIT BORROWING" means a borrowing
consisting of simultaneous Revolving Credit Advances of the same
Type made by the Revolving Credit Lenders.
"REVOLVING CREDIT COMMITMENT" means, with respect to any
Revolving Credit Lender at any time, the amount set forth opposite
such Lender's name on Schedule I hereto under the caption "Revolving
Credit Commitment" or, if such Lender has entered into one or more
Assignment and Acceptances, set forth for such Lender in the
Register maintained by the Administrative Agent pursuant to Section
8.07(d) as such Lender's "Revolving Credit Commitment", as such
amount may be reduced at or prior to such time pursuant to Section
2.05.
"REVOLVING CREDIT FACILITY" means, at any time, the
aggregate amount of the Revolving Credit Lenders' Revolving Credit
Commitments at such time.
"REVOLVING CREDIT LENDER" means any Lender that has a
Revolving Credit Commitment.
"REVOLVING CREDIT NOTE" means a promissory note of the
Borrower payable to the order of any Revolving Credit Lender, in
substantially the form of Exhibit A-1 hereto, evidencing the
aggregate indebtedness of the Borrower to such Lender resulting from
the
33
33
Revolving Credit Advances, Letter of Credit Advances and Swing Line
Advances made by such Lender, as amended.
"SECURED HEDGE AGREEMENT" means any Hedge Agreement
required or permitted under Article V that is entered into by and
between the Borrower and any Hedge Bank.
"SECURED OBLIGATIONS" has the meaning specified in
Section 2 of the Security Agreement.
"SECURED PARTIES" means the Agents, the Lender Parties
and the Hedge Banks.
"SECURITY AGREEMENT" has the meaning specified in
Section 3.01(a)(ii).
"SELLER" has the meaning specified in the Preliminary
Statements.
"SENIOR DEBT/EBITDA RATIO" means, at any date of
determination, the ratio of (a) the sum of (i) Consolidated total
Debt for Borrowed Money of the Borrower and its Subsidiaries less
(ii) Subordinated Debt, in each case, as at the end of the most
recently ended fiscal quarter of the Borrower for which financial
statements are required to be delivered to the Lender Parties
pursuant to Section 5.03(b) or (c), as the case may be, to (b) Pro
Forma Consolidated EBITDA of the Borrower and its Subsidiaries for
such fiscal quarter and the immediately preceding three fiscal
quarters.
"SENIOR SUBORDINATED NOTE INDENTURE" has the meaning
specified in the Preliminary Statements.
"SENIOR SUBORDINATED NOTES" has the meaning specified in
the Preliminary Statements.
"SENIOR SUBORDINATED NOTE TRUSTEE" has the meaning
specified in the Preliminary Statements.
"SHAREHOLDERS AGREEMENTS" means (a) the Amended and
Restated Shareholders Agreement dated as of December 14, 1999, as
amended through the Effective Date, among SSCI Investors, the
Seller, the Borrower and the other shareholders of the Borrower
immediately prior to the Acquisition and (b) the Shareholders
Agreement dated as of December 29, 1999, among the SSCI Investors,
certain members of the management of the Borrower and its
Subsidiaries and the Borrower, in each case, as amended, to the
extent permitted under the Loan Documents.
34
34
"SINGLE EMPLOYER PLAN" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for
employees of any Loan Party or any ERISA Affiliate and no Person
other than the Loan Parties and the ERISA Affiliates or (b) was so
maintained and in respect of which any Loan Party or any ERISA
Affiliate could have liability under Section 4069 of ERISA in the
event such plan has been or were to be terminated.
"SOLVENT" and "SOLVENCY" mean, with respect to any
Person on a particular date, that on such date (a) the fair value of
the property of such Person is greater than the total amount of
liabilities, including, without limitation, contingent liabilities,
of such Person, (b) the present fair salable value of the assets of
such Person is not less than the amount that will be required to pay
the probable liability of such Person on its debts as they become
absolute and matured, (c) such Person does not intend to, and does
not believe that it will, incur debts or liabilities beyond such
Person's ability to pay such debts and liabilities as they mature
and (d) such Person is not engaged in business or a transaction, and
is not about to engage in business or a transaction, for which such
Person's property would constitute an unreasonably small capital.
The amount of contingent liabilities at any time shall be computed
as the amount that, in the light of all the facts and circumstances
existing at such time, represents the amount that can reasonably be
expected to become an actual or matured liability.
"SPONSOR" has the meaning specified in the Preliminary
Statements.
"SSCI INVESTORS" has the meaning specified in the
Preliminary Statements.
"STANDBY LETTER OF CREDIT" means any Letter of Credit
issued under the Letter of Credit Facility, other than a Trade
Letter of Credit.
"SUBORDINATED DEBT" means the Senior Subordinated Notes
and any other Debt of any Loan Party that is subordinated to the
Obligations of such Loan Party under the Loan Documents on, and that
otherwise contains, terms and conditions satisfactory to the
Required Lenders.
"SUBORDINATED DEBT DOCUMENTS" means the Indenture, the
Senior Subordinated Notes and all other agreements, indentures and
instruments pursuant to which Subordinated Debt is issued, in each
case as amended, to the extent permitted under the Loan Documents.
"SUBSIDIARY" of any Person means any corporation,
partnership, joint venture, limited liability company, trust or
estate of which (or in which) more than 50% of the issued and
outstanding capital stock or other ownership interests having
ordinary voting
35
35
power to elect a majority of the Board of Directors or other
managers of such corporation or other entity (irrespective of
whether at the time interests of any other class or classes of such
entity shall or might have voting power upon the occurrence of any
contingency) is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its
other Subsidiaries or by one or more of such Person's other
Subsidiaries.
"SUBSIDIARY GUARANTORS" means the Subsidiaries of the
Borrower listed on Schedule II hereto and each other Subsidiary of
the Borrower that shall be required to execute and deliver a
guaranty pursuant to Section 5.01(j).
"SUBSIDIARY GUARANTY" has the meaning specified in
Section 3.01(a)(iii).
"SURVIVING DEBT" means Debt of each Loan Party and its
Subsidiaries outstanding immediately before and after giving effect
to the Transaction.
"SWING LINE ADVANCE" means an advance made by (a) the
Swing Line Bank pursuant to Section 2.01(d) or (b) any Revolving
Credit Lender pursuant to Section 2.02(b).
"SWING LINE BANK" means Chase.
"SWING LINE BORROWING" means a borrowing consisting of a
Swing Line Advance made by the Swing Line Bank pursuant to Section
2.01(d) or the Revolving Credit Lenders pursuant to Section 2.02(b).
"SWING LINE FACILITY" has the meaning specified in
Section 2.01(d).
"TAXES" has the meaning specified in Section 2.12(a).
"TERM A ADVANCE" has the meaning specified in Section
2.01(a).
"TERM A BORROWING" means a borrowing consisting of
simultaneous Term A Advances of the same Type made by the Term A
Lenders.
"TERM A COMMITMENT" means, with respect to any Term A
Lender at any time, the amount set forth opposite such Lender's name
on Schedule I hereto under the caption "Term A Commitment" or, if
such Lender has entered into one or more Assignment and Acceptances,
set forth for such Lender in the Register maintained by the
Administrative Agent pursuant to Section 9.07(d) as such Lender's
"Term A Commitment", as such amount may be reduced at or prior to
such time pursuant to Section 2.05.
36
36
"TERM ADVANCE" means a Term A Advance or a Term B
Advance.
"TERM A FACILITY" means, at any time, the aggregate
amount of the Term A Lenders' Term A Commitments at such time.
"TERM A LENDER" means any Lender that has a Term A
Commitment.
"TERM A NOTE" means a promissory note of the Borrower
payable to the order of any Term A Lender, in substantially the form
of Exhibit A-2 hereto, evidencing the indebtedness of the Borrower
to such Lender resulting from the Term A Advances made by such
Lender, as amended.
"TERM B ADVANCE" has the meaning specified in Section
2.01(b).
"TERM B BORROWING" means a borrowing consisting of
simultaneous Term B Advances of the same Type made by the Term B
Lenders.
"TERM B COMMITMENT" means, with respect to any Term B
Lender at any time, the amount set forth opposite such Lender's name
on Schedule I hereto under the caption "Term B Commitment" or, if
such Lender has entered into one or more Assignment and Acceptances,
set forth for such Lender in the Register maintained by the
Administrative Agent pursuant to Section 9.07(d) as such Lender's
"Term B Commitment", as such amount may be reduced at or prior to
such time pursuant to Section 2.05.
"TERM B FACILITY" means, at any time, the aggregate
amount of the Term B Lenders' Term B Commitments at such time.
"TERM B LENDER" means any Lender that has a Term B
Commitment.
"TERM B NOTE" means a promissory note of the Borrower
payable to the order of any Term B Lender, in substantially the form
of Exhibit A-3 hereto, evidencing the indebtedness of the Borrower
to such Lender resulting from the Term B Advances made by such
Lender, as amended.
"TERM BORROWING" means any Term A Borrowing or Term B
Borrowing.
"TERM COMMITMENT" means any Term A Commitment or Term B
Commitment.
"TERM FACILITY" means the Term A Facility or Term B
Facility.
"TERMINATION DATE" means the earlier of (a) the date of
termination in whole of the Revolving Credit Commitments, the Letter
of Credit Commitment and the Term
37
37
Commitments pursuant to Section 2.05 or 6.01 and (b) (i) for
purposes of the Revolving Credit Facility and the Letter of Credit
Facility, the sixth anniversary of the Effective Date, (ii) for
purposes of the Term A Facility, the sixth anniversary of the
Effective Date and (iii) for purposes of the Term B Facility and for
all other purposes, the seventh anniversary of the Effective Date.
"TERM LENDER" means any Term A Lender or Term B Lender.
"TERM NOTE" means any Term A Note or Term B Note.
"TOTAL DEBT/EBITDA RATIO" means, at any date of
determination, the ratio of (a) Consolidated total Debt for Borrowed
Money of the Borrower and its Subsidiaries as at the end of the most
recently ended fiscal quarter of the Borrower for which financial
statements are required to be delivered to the Lender Parties
pursuant to Section 5.03(b) or (c), as the case may be, to (b) Pro
Forma Consolidated EBITDA of the Borrower and its Subsidiaries for
such fiscal quarter and the immediately preceding three fiscal
quarters.
"TRADE LETTER OF CREDIT" means any Letter of Credit that
is issued under the Letter of Credit Facility for the benefit of a
supplier of Inventory to the Borrower or any of its Subsidiaries to
effect payment for such Inventory, the conditions to drawing under
which include the presentation to the Issuing Bank of negotiable
bills of lading, invoices and related documents sufficient, in the
judgment of the Issuing Bank, to create a valid and perfected lien
on or security interest in such Inventory, bills of lading, invoices
and related documents in favor of the Issuing Bank.
"TRANSACTION" means the Redemption, the Acquisition, the
Offer to Purchase and the other transactions contemplated by the
Transaction Documents.
"TRANSACTION DOCUMENTS" means, collectively, the Loan
Documents and the Related Documents.
"TYPE" refers to the distinction between Advances
bearing interest at the Base Rate and Advances bearing interest at
the Eurodollar Rate.
"UNUSED REVOLVING CREDIT COMMITMENT" means, with respect
to any Revolving Credit Lender at any time, (a) such Lender's
Revolving Credit Commitment at such time minus (b) the sum of (i)
the aggregate principal amount of all Revolving Credit Advances,
Swing Line Advances and Letter of Credit Advances made by such
Lender (in its capacity as a Lender) and outstanding at such time
plus (ii) such Lender's Pro Rata Share of (A) the aggregate
Available Amount of all Letters of Credit outstanding at such
38
38
time, (B) the aggregate principal amount of all Letter of Credit
Advances made by the Issuing Bank pursuant to Section 2.03(c) and
outstanding at such time and (C) the aggregate principal amount of
all Swing Line Advances made by the Swing Line Bank pursuant to
Section 2.01(d) and outstanding at such time.
"VOTING INTERESTS" means shares of capital stock issued
by a corporation, or equivalent Equity Interests in any other
Person, the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or
persons performing similar functions) of such Person, even if the
right so to vote has been suspended by the happening of such a
contingency.
"WELFARE PLAN" means a welfare plan, as defined in
Section 3(1) of ERISA, that is maintained for employees of any Loan
Party or in respect of which any Loan Party could have liability.
"WITHDRAWAL LIABILITY" has the meaning specified in Part
I of Subtitle E of Title IV of ERISA.
SECTION 1.02. Computation of Time Periods; Other Definitional
Provisions. In this Agreement and the other Loan Documents in the computation of
periods of time from a specified date to a later specified date, the word "FROM"
means "from and including" and the words "TO" and "UNTIL" each mean "to but
excluding". References in the Loan Documents to any agreement or contract "AS
AMENDED" shall mean and be a reference to such agreement or contract as amended,
amended and restated, supplemented or otherwise modified from time to time in
accordance with its terms.
SECTION 1.03. Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles consistent with those applied in the preparation
of the financial statements referred to in Section 4.01(g) ("GAAP").
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND THE LETTERS OF CREDIT
SECTION 2.01. Advances and Letters of Credit. (a) Term A Advances.
Each Term A Lender severally agrees, on the terms and conditions hereinafter set
forth, to make advances (each a "TERM A ADVANCE") to the Borrower on any
Business Day during the period from the date on which all the Term B Commitments
shall have been fully drawn or terminated
39
39
until the date that occurs eighteen (18) month after the Effective Date, in an
amount not to exceed such Lender's Term A Commitment at such time. Each Term A
Borrowing shall consist of Term A Advances made simultaneously by the Term A
Lenders ratably according to their Term A Commitments. Amounts borrowed under
this Section 2.01(a) and repaid or prepaid may not be reborrowed.
(b) Term B Advances. Each Term B Lender severally agrees, on
the terms and conditions hereinafter set forth, to make advances (each a "TERM B
ADVANCE") to the Borrower on any Business Day during the period from the
Effective Date until the Note Purchase Date, in an amount not to exceed such
Lender's Term B Commitment at such time. Each Term B Borrowing shall consist of
Term B Advances made simultaneously by the Term B Lenders ratably according to
their Term B Commitments. Amounts borrowed under this Section 2.01(b) and repaid
or prepaid may not be reborrowed.
(c) Revolving Credit Advances. Each Revolving Credit Lender
severally agrees, on the terms and conditions hereinafter set forth, to make
advances (each a "REVOLVING CREDIT ADVANCE") to the Borrower from time to time
on any Business Day during the period from the Effective Date until the
Termination Date in an amount for each such Advance not to exceed such Lender's
Unused Revolving Credit Commitment at such time. Each Revolving Credit Borrowing
shall be in an aggregate amount of $1,000,000 or an integral multiple of
$1,000,000 in excess thereof (other than a Borrowing the proceeds of which shall
be used solely to repay or prepay in full outstanding Swing Line Advances or
outstanding Letter of Credit Advances) and shall consist of Revolving Credit
Advances made simultaneously by the Revolving Credit Lenders ratably according
to their Revolving Credit Commitments. Within the limits of each Revolving
Credit Lender's Unused Revolving Credit Commitment in effect from time to time,
the Borrower may borrow under this Section 2.01(c), prepay pursuant to Section
2.06(a) and reborrow under this Section 2.01(c). Revolving Credit Borrowings
shall also be subject to the following additional limitations: (i) a Revolving
Credit Borrowing of not more than $15 million may be requested to be made
available on the Effective Date; (ii) no Revolving Credit Borrowing may be
requested to fund any portion of the purchase price to be paid by the Borrower
or any of its Subsidiaries in connection with a Permitted Acquisition on any
date that any Term A Commitments remain undrawn; and (iii) during the period
until the Termination Date, not more than an aggregate of $25 million of
Revolving Credit Borrowings may be requested to fund the purchase price of
Permitted Acquisitions.
(d) Swing Line Advances. The Swing Line Bank agrees to make,
on the terms and conditions hereinafter set forth, Swing Line Advances to the
Borrower from time to time on any Business Day during the period from the
Effective Date until the Termination Date (i) in an aggregate amount not to
exceed at any time outstanding $10,000,000 (the "SWING LINE FACILITY") and (ii)
in an amount for each such Swing Line Borrowing not to exceed the aggregate of
the Unused Revolving Credit Commitments of the Revolving Credit Lenders at such
time. No
40
40
Swing Line Advance shall be used for the purpose of funding the payment of
principal of any other Swing Line Advance. Each Swing Line Borrowing shall be in
an amount of $1,000,000 or an integral multiple of $500,000 in excess thereof
and shall be made as a Base Rate Advance. Within the limits of the Swing Line
Facility and within the limits referred to in clause (ii) above, so long as the
Swing Line Bank, in its sole discretion, elects to make Swing Line Advances, the
Borrower may borrow under this Section 2.01(d), repay pursuant to Section
2.04(d) or prepay pursuant to Section 2.06(a) and reborrow under this Section
2.01(d).
(e) Letters of Credit. The Borrower, the Issuing Bank and each
of the Revolving Credit Lenders hereby agree that each of the Existing Letters
of Credit shall, on and after the Effective Date, continue as and be deemed for
all purposes of this Agreement to be a Letter of Credit issued and outstanding
under the terms of this Agreement. The Issuing Bank agrees, on the terms and
conditions hereinafter set forth, to issue (or cause its Affiliate that is a
commercial bank to issue on its behalf) letters of credit (the "LETTERS OF
CREDIT") for the account of the Borrower from time to time on any Business Day
during the period from the date hereof until 60 days before the Termination Date
in an aggregate Available Amount (i) for all Letters of Credit not to exceed at
any time the lesser of (x) the Letter of Credit Facility at such time and (y)
the Issuing Bank's Letter of Credit Commitment at such time and (ii) for each
such Letter of Credit not to exceed an amount equal to the Unused Revolving
Credit Commitments of the Revolving Credit Lenders at such time. No Letter of
Credit shall have an expiration date (including all rights of the Borrower or
the beneficiary to require renewal) later than the earlier of 20 days before the
Termination Date and (A) in the case of a Standby Letter of Credit, one year
after the date of issuance thereof, but may by its terms be renewable annually
upon notice (a "NOTICE OF RENEWAL") given to the Issuing Bank and the
Administrative Agent on or prior to any date for notice of renewal set forth in
such Letter of Credit but in any event at least three Business Days prior to the
date of the proposed renewal of such Standby Letter of Credit and upon
fulfillment of the applicable conditions set forth in Article III unless the
Issuing Bank has notified the Borrower (with a copy to the Administrative Agent)
on or prior to the date for notice of termination set forth in such Letter of
Credit but in any event at least 10 Business Days prior to the date of automatic
renewal of its election not to renew such Standby Letter of Credit (a "NOTICE OF
TERMINATION") and (B) in the case of a Trade Letter of Credit, 180 days after
the date of issuance thereof; provided that the terms of each Standby Letter of
Credit that is automatically renewable annually shall (x) require the Issuing
Bank to give the beneficiary named in such Standby Letter of Credit notice of
any Notice of Termination, (y) permit such beneficiary, upon receipt of such
notice, to draw under such Standby Letter of Credit prior to the date such
Standby Letter of Credit otherwise would have been automatically renewed and (z)
not permit the expiration date (after giving effect to any renewal) of such
Standby Letter of Credit in any event to be extended to a date later than 20
days before the Termination Date. If either a Notice of Renewal is not given by
the Borrower or a Notice of Termination is given by the Issuing Bank pursuant to
the immediately preceding sentence, such Standby Letter of Credit shall expire
on the date on which it otherwise would have been automatically renewed;
provided, however, that even
41
41
in the absence of receipt of a Notice of Renewal the Issuing Bank may in its
discretion, unless instructed to the contrary by the Administrative Agent or the
Borrower, deem that a Notice of Renewal had been timely delivered and in such
case, a Notice of Renewal shall be deemed to have been so delivered for all
purposes under this Agreement. Each Standby Letter of Credit shall contain a
provision authorizing the Issuing Bank to deliver to the beneficiary of such
Letter of Credit, upon the occurrence and during the continuance of an Event of
Default, a notice (a "DEFAULT TERMINATION NOTICE") terminating such Letter of
Credit and giving such beneficiary 15 days to draw such Letter of Credit. Within
the limits of the Letter of Credit Facility, and subject to the limits referred
to above, the Borrower may request the issuance of Letters of Credit under this
Section 2.01(e), repay any Letter of Credit Advances resulting from drawings
thereunder pursuant to Section 2.03(c) and request the issuance of additional
Letters of Credit under this Section 2.01(e).
SECTION 2.02. Making the Advances. (a) Except as otherwise provided
in Section 2.02(b) or 2.03, each Borrowing shall be made on notice, given not
later than 11:00 A.M. (New York City time) on the third Business Day prior to
the date of the proposed Borrowing in the case of a Borrowing consisting of
Eurodollar Rate Advances, or the first Business Day prior to the date of the
proposed Borrowing in the case of a Borrowing consisting of Base Rate Advances,
by the Borrower to the Administrative Agent, which shall give to each
Appropriate Lender prompt notice thereof by telex or telecopier. Each such
notice of a Borrowing (a "NOTICE OF BORROWING") shall be by telephone, confirmed
immediately in writing, or telex or telecopier, in substantially the form of
Exhibit B hereto, specifying therein the requested (i) date of such Borrowing,
(ii) Facility under which such Borrowing is to be made, (iii) Type of Advances
comprising such Borrowing, (iv) aggregate amount of such Borrowing, (v) in the
case of a Borrowing consisting of Eurodollar Rate Advances, initial Interest
Period for each such Advance and (vi) if any portion of such Borrowing is
proposed to be used to pay the purchase price of any Permitted Acquisitions, the
portion of such Borrowing, and the cash and Cash Equivalent of the Borrower and
its Subsidiaries on the date of such Notice of Borrowing, proposed to be used to
pay such purchase price of such Permitted Acquisition. Each Appropriate Lender
shall, before 11:00 A.M. (New York City time) on the date of such Borrowing,
make available for the account of its Applicable Lending Office to the
Administrative Agent at the Administrative Agent's Account, in same day funds,
such Lender's ratable portion of such Borrowing in accordance with the
respective Commitments under the applicable Facility of such Lender and the
other Appropriate Lenders. After the Administrative Agent's receipt of such
funds and upon fulfillment of the applicable conditions set forth in Article
III, the Administrative Agent will make such funds available to the Borrower by
crediting the Borrower's Account; provided, however, that, in the case of any
Revolving Credit Borrowing, the Administrative Agent shall first make a portion
of such funds equal to the aggregate principal amount of any Swing Line Advances
and Letter of Credit Advances made by the Swing Line Bank or the Issuing Bank,
as the case may be, and by any other Revolving Credit Lender and outstanding on
the date of such Revolving Credit Borrowing, plus interest accrued and unpaid
thereon to and as of such date,
42
42
available to the Swing Line Bank or the Issuing Bank, as the case may be, and
such other Revolving Credit Lenders for repayment of such Swing Line Advances
and Letter of Credit Advances.
(b) Each Swing Line Borrowing shall be made on notice, given
not later than 11:00 A.M. (New York City time) on the date of the proposed Swing
Line Borrowing, by the Borrower to the Swing Line Bank and the Administrative
Agent. Each such notice of a Swing Line Borrowing (a "NOTICE OF SWING LINE
BORROWING") shall be by telephone, confirmed immediately in writing, or telex or
telecopier, specifying therein the requested (i) date of such Borrowing, (ii)
amount of such Borrowing and (iii) maturity of such Borrowing (which maturity
shall be no later than the seventh day after the requested date of such
Borrowing). The Swing Line Bank will make the amount thereof available to the
Administrative Agent at the Administrative Agent's Account, in same day funds.
After the Administrative Agent's receipt of such funds and upon fulfillment of
the applicable conditions set forth in Article III, the Administrative Agent
will make such funds available to the Borrower by crediting the Borrower's
Account. Upon written demand by the Swing Line Bank, with a copy of such demand
to the Administrative Agent, each other Revolving Credit Lender shall purchase
from the Swing Line Bank, and the Swing Line Bank shall sell and assign to each
such other Revolving Credit Lender, such other Lender's Pro Rata Share of such
outstanding Swing Line Advance as of the date of such demand, by making
available for the account of its Applicable Lending Office to the Administrative
Agent for the account of the Swing Line Bank, by deposit to the Administrative
Agent's Account, in same day funds, an amount equal to the portion of the
outstanding principal amount of such Swing Line Advance to be purchased by such
Lender. The Borrower hereby agrees to each such sale and assignment. Each
Revolving Credit Lender agrees to purchase its Pro Rata Share of an outstanding
Swing Line Advance on (i) the Business Day on which demand therefor is made by
the Swing Line Bank, provided that notice of such demand is given not later than
11:00 A.M. (New York City time) on such Business Day or (ii) the first Business
Day next succeeding such demand if notice of such demand is given after such
time. Upon any such assignment by the Swing Line Bank to any other Revolving
Credit Lender of a portion of a Swing Line Advance, the Swing Line Bank
represents and warrants to such other Lender that the Swing Line Bank is the
legal and beneficial owner of such interest being assigned by it, but makes no
other representation or warranty and assumes no responsibility with respect to
such Swing Line Advance, the Loan Documents or any Loan Party. If and to the
extent that any Revolving Credit Lender shall not have so made the amount of
such Swing Line Advance available to the Administrative Agent, such Revolving
Credit Lender agrees to pay to the Administrative Agent forthwith on demand such
amount together with interest thereon, for each day from the date of demand by
the Swing Line Bank until the date such amount is paid to the Administrative
Agent, at the Federal Funds Rate. If such Lender shall pay to the Administrative
Agent such amount for the account of the Swing Line Bank on any Business Day,
such amount so paid in respect of principal shall constitute a Swing Line
Advance made by such Lender on such Business Day for purposes of this Agreement,
and the outstanding principal amount of the
43
43
Swing Line Advance made by the Swing Line Bank shall be reduced by such amount
on such Business Day.
(c) Anything in subsection (a) above to the contrary
notwithstanding, (i) the Borrower may not select Eurodollar Rate Advances for
the initial Borrowing hereunder and for the period from the date hereof to
January 6, 2000 (or such earlier date as shall be specified in its sole
discretion by the Administrative Agent in a written notice to the Borrower and
the Lenders) or for any Borrowing if the aggregate amount of such Borrowing is
less than $1,000,000 or if the obligation of the Appropriate Lenders to make
Eurodollar Rate Advances shall then be suspended pursuant to Section 2.09 or
2.10 and (ii) the Advances may not be outstanding as part of more than 10
separate Borrowings.
(d) Each Notice of Borrowing and Notice of Swing Line
Borrowing shall be irrevocable and binding on the Borrower. In the case of any
Borrowing that the related Notice of Borrowing specifies is to be comprised of
Eurodollar Rate Advances, the Borrower shall indemnify each Appropriate Lender
against any loss, cost or expense incurred by such Lender as a result of any
failure to fulfill on or before the date specified in such Notice of Borrowing
for such Borrowing the applicable conditions set forth in Article III,
including, without limitation, any loss (including loss of anticipated profits),
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by such Lender to fund the Advance to be made
by such Lender as part of such Borrowing when such Advance, as a result of such
failure, is not made on such date.
(e) Unless the Administrative Agent shall have received notice
from an Appropriate Lender prior to the date of any Borrowing under a Facility
under which such Lender has a Commitment that such Lender will not make
available to the Administrative Agent such Lender's ratable portion of such
Borrowing, the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the date of such Borrowing in
accordance with subsection (a) of this Section 2.02 and the Administrative Agent
may, in reliance upon such assumption, make available to the Borrower on such
date a corresponding amount. If and to the extent that such Lender shall not
have so made such ratable portion available to the Administrative Agent, such
Lender and the Borrower severally agree to repay or pay to the Administrative
Agent forthwith on demand such corresponding amount and to pay interest thereon,
for each day from the date such amount is made available to the Borrower until
the date such amount is repaid or paid to the Administrative Agent, at (i) in
the case of the Borrower, the interest rate applicable at such time under
Section 2.07 to Advances comprising such Borrowing and (ii) in the case of such
Lender, the Federal Funds Rate. If such Lender shall pay to the Administrative
Agent such corresponding amount, such amount so paid shall constitute such
Lender's Advance as part of such Borrowing for all purposes.
44
44
(f) The failure of any Lender to make the Advance to be made by it
as part of any Borrowing shall not relieve any other Lender of its obligation,
if any, hereunder to make its Advance on the date of such Borrowing, but no
Lender shall be responsible for the failure of any other Lender to make the
Advance to be made by such other Lender on the date of any Borrowing.
SECTION 2.03. Issuance of and Drawings and Reimbursement Under
Letters of Credit. (a) Request for Issuance. Each Letter of Credit shall be
issued upon notice, given not later than 11:00 A.M. (New York City time) on the
fifth Business Day prior to the date of the proposed issuance of such Letter of
Credit, by the Borrower to the Issuing Bank, which shall give to the
Administrative Agent and each Revolving Credit Lender prompt notice thereof by
telex or telecopier. Each such notice of issuance of a Letter of Credit (a
"NOTICE OF ISSUANCE") shall be by telephone, confirmed immediately in writing,
or telex or telecopier, specifying therein the requested (A) date of such
issuance (which shall be a Business Day), (B) Available Amount of such Letter of
Credit, (C) expiration date of such Letter of Credit, (D) name and address of
the beneficiary of such Letter of Credit and (E) form of such Letter of Credit,
and shall be accompanied by such application and agreement for letter of credit
as the Issuing Bank may specify to the Borrower for use in connection with such
requested Letter of Credit (a "LETTER OF CREDIT AGREEMENT"). If the requested
form of such Letter of Credit is acceptable to the Issuing Bank in its sole
discretion, the Issuing Bank will, upon fulfillment of the applicable conditions
set forth in Article III, make such Letter of Credit available to the Borrower
at its office referred to in Section 8.02 or as otherwise agreed with the
Borrower in connection with such issuance. In the event and to the extent that
the provisions of any Letter of Credit Agreement shall conflict with this
Agreement, the provisions of this Agreement shall govern.
(b) Letter of Credit Reports. The Issuing Bank shall furnish (A) to
the Administrative Agent on the first Business Day of each week a written report
summarizing issuance and expiration dates of Letters of Credit issued during the
previous week and drawings during such week under all Letters of Credit, (B) to
each Revolving Credit Lender on the first Business Day of each month a written
report summarizing issuance and expiration dates of Letters of Credit issued
during the preceding month and drawings during such month under all Letters of
Credit and (C) to the Administrative Agent and each Revolving Credit Lender on
the first Business Day of each calendar quarter a written report setting forth
the average daily aggregate Available Amount during the preceding calendar
quarter of all Letters of Credit.
(c) Drawing and Reimbursement. The payment by the Issuing Bank of a
draft drawn under any Letter of Credit shall constitute for all purposes of this
Agreement the making by the Issuing Bank of a Letter of Credit Advance, which
shall be a Base Rate Advance, in the amount of such draft. Upon written demand
by the Issuing Bank, with a copy of such demand to the Administrative Agent,
each Revolving Credit Lender shall purchase from the Issuing Bank, and the
Issuing Bank shall sell and assign to each such Revolving Credit Lender, such
Lender's
45
45
Pro Rata Share of such outstanding Letter of Credit Advance as of the date of
such purchase, by making available for the account of its Applicable Lending
Office to the Administrative Agent for the account of the Issuing Bank, by
deposit to the Administrative Agent's Account, in same day funds, an amount
equal to the portion of the outstanding principal amount of such Letter of
Credit Advance to be purchased by such Lender. Promptly after receipt thereof,
the Administrative Agent shall transfer such funds to the Issuing Bank. The
Borrower hereby agrees to each such sale and assignment. Each Revolving Credit
Lender agrees to purchase its Pro Rata Share of an outstanding Letter of Credit
Advance on (i) the Business Day on which demand therefor is made by the Issuing
Bank, provided that notice of such demand is given not later than 11:00 A.M.
(New York City time) on such Business Day, or (ii) the first Business Day next
succeeding such demand if notice of such demand is given after such time. Upon
any such assignment by the Issuing Bank to any Revolving Credit Lender of a
portion of a Letter of Credit Advance, the Issuing Bank represents and warrants
to such other Lender that the Issuing Bank is the legal and beneficial owner of
such interest being assigned by it, free and clear of any liens, but makes no
other representation or warranty and assumes no responsibility with respect to
such Letter of Credit Advance, the Loan Documents or any Loan Party. If and to
the extent that any Revolving Credit Lender shall not have so made the amount of
such Letter of Credit Advance available to the Administrative Agent, such
Revolving Credit Lender agrees to pay to the Administrative Agent forthwith on
demand such amount together with interest thereon, for each day from the date of
demand by the Issuing Bank until the date such amount is paid to the
Administrative Agent, at the Federal Funds Rate for its account or the account
of the Issuing Bank, as applicable. If such Lender shall pay to the
Administrative Agent such amount for the account of the Issuing Bank on any
Business Day, such amount so paid in respect of principal shall constitute a
Letter of Credit Advance made by such Lender on such Business Day for purposes
of this Agreement, and the outstanding principal amount of the Letter of Credit
Advance made by the Issuing Bank shall be reduced by such amount on such
Business Day.
(d) Failure to Make Letter of Credit Advances. The failure of any
Lender to make the Letter of Credit Advance to be made by it on the date
specified in Section 2.03(c) shall not relieve any other Lender of its
obligation hereunder to make its Letter of Credit Advance on such date, but no
Lender shall be responsible for the failure of any other Lender to make the
Letter of Credit Advance to be made by such other Lender on such date.
SECTION 2.04. Repayment of Advances. (a) Term A Advances. The
Borrower shall repay to the Administrative Agent for the ratable account of the
Term A Lenders the aggregate outstanding principal amount of the Term A Advances
in an amount on each of the following dates equal to the percentage indicated
for such date of the aggregate principal amount of Term A Advances which are
outstanding on the eighteen (18) month anniversary of the Effective Date (which
installment amounts shall be reduced as a result of the application of
prepayments in accordance with Section 2.06):
46
46
Date Percentage
---- ----------
March 31, 2001 0%
June 30, 2001 0%
September 30, 2001 5%
December 31, 2001 5%
March 31, 2002 5%
June 30, 2002 5%
September 30, 2002 5%
December 31, 2002 5%
March 31, 2003 5%
June 30, 2003 5%
September 30, 2003 5%
December 31, 2003 5%
March 31, 2004 6.25%
June 30, 2004 6.25%
September 30, 2004 6.25%
December 31, 2004 6.25%
March 31, 2005 6.25%
June 30, 2005 6.25%
September 30, 2005 6.25%
Termination Date 6.25%
provided, however, that the final principal installment shall be repaid on the
Termination Date and in any event shall be in an amount equal to the aggregate
principal amount of the Term A Advances outstanding on such date.
(b) Term B Advances. The Borrower shall repay to the Administrative
Agent for the ratable account of the Term B Lenders the aggregate outstanding
principal amount of the Term B Advances in an amount on each of the following
dates equal to the percentage indicated for such date of the aggregate principal
amount of the Term B Advances which are outstanding on the Note Purchase Date
(which installment amounts shall be reduced as a result of the application of
prepayments in accordance with the order of priority set forth in Section 2.06):
Date Percentage
---- ----------
March 31, 2001 0.25%
June 30, 2001 0.25%
47
47
Date Percentage
---- ----------
September 30, 2001 0.25%
December 31, 2001 0.25%
March 31, 2002 0.25%
June 30, 2002 0.25%
September 30, 2002 0.25%
December 31, 2002 0.25%
March 31, 2003 0.25%
June 30, 2003 0.25%
September 30, 2003 0.25%
December 31, 2003 0.25%
March 31, 2004 0.25%
June 30, 2004 0.25%
September 30, 2004 0.25%
December 31, 2004 0.25%
March 31, 2005 0.25%
June 30, 2005 0.25%
September 30, 2005 0.25%
December 31, 2005 0.25%
March 31, 2006 23.75%
June 30, 2006 23.75%
September 30, 2006 23.75%
Termination Date 23.75%
provided, however, that the final principal installment shall be repaid on the
Termination Date and in any event shall be in an amount equal to the aggregate
principal amount of the Term B Advances outstanding on such date.
(c) Revolving Credit Advances. The Borrower shall repay to the
Administrative Agent for the ratable account of the Revolving Credit Lenders on
the Termination Date the aggregate principal amount of the Revolving Credit
Advances then outstanding.
(d) Swing Line Advances. The Borrower shall repay to the
Administrative Agent for the account of the Swing Line Bank and each other
Revolving Credit Lender that has made a Swing Line Advance the outstanding
principal amount of each Swing Line Advance made by each of them on the earlier
of the maturity date specified in the applicable Notice of Swing Line Borrowing
(which maturity shall be no later than the seventh day after the requested date
of such Borrowing) and the Termination Date.
48
48
(e) Letter of Credit Advances. (i) The Borrower shall repay to the
Administrative Agent for the account of the Issuing Bank and each other
Revolving Credit Lender that has made a Letter of Credit Advance on the earlier
of demand and the Termination Date the outstanding principal amount of each
Letter of Credit Advance made by each of them.
(ii) The Obligations of the Borrower under this Agreement, any
Letter of Credit Agreement and any other agreement or instrument relating to any
Letter of Credit shall be unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement, such Letter of Credit
Agreement and such other agreement or instrument under all circumstances,
including, without limitation, the following circumstances(it being understood
that any such payment by the Borrower is without prejudice to, and does not
constitute a waiver of, any rights the Borrower might have or might acquire as a
result of the payment by the Issuing Bank of any draft or the reimbursement by
the Borrower thereof):
(A) any lack of validity or enforceability of any Loan
Document, any Letter of Credit Agreement, any Letter of Credit or any
other agreement or instrument relating thereto (all of the foregoing
being, collectively, the "L/C RELATED DOCUMENTS");
(B) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Obligations of the Borrower in
respect of any L/C Related Document or any other amendment or waiver of
or any consent to departure from all or any of the L/C Related
Documents;
(C) the existence of any claim, set-off, defense or other
right that the Borrower may have at any time against any beneficiary or
any transferee of a Letter of Credit (or any Persons for which any such
beneficiary or any such transferee may be acting), the Issuing Bank or
any other Person, whether in connection with the transactions
contemplated by the L/C Related Documents or any unrelated transaction;
(D) any statement or any other document presented under a
Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(E) payment by the Issuing Bank under a Letter of Credit
against presentation of a draft or certificate that does not strictly
comply with the terms of such Letter of Credit;
(F) any exchange, release or non-perfection of any Collateral
or other collateral, or any release or amendment or waiver of or
consent to departure from the
49
49
Guaranties or any other guarantee, for all or any of the Obligations
of the Borrower in respect of the L/C Related Documents; or
(G) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing, including, without limitation, any
other circumstance that might otherwise constitute a defense available
to, or a discharge of, the Borrower or a guarantor.
SECTION 2.05. Termination or Reduction of the Commitments. (a)
Optional. The Borrower may, upon at least three Business Days' notice to the
Administrative Agent, terminate in whole or reduce in part the unused portions
of the Term A Commitments, the Term B Commitments and the Letter of Credit
Facility and the Unused Revolving Credit Commitments; provided, however, that
each partial reduction of a Facility (i) shall be in an aggregate amount of
$5,000,000 or an integral multiple of $1,000,000 in excess thereof and (ii)
shall be made ratably among the Appropriate Lenders in accordance with their
Commitments with respect to such Facility.
(b) Mandatory. (i) On the date that occurs eighteen months after the
Effective Date, after giving effect to any Term A Borrowing on such date, and
from time to time thereafter upon each repayment or prepayment of the Term A
Advances, the aggregate Term A Commitments of the Term A Lenders shall be
automatically and permanently reduced, on a pro rata basis, by an amount equal
to the amount by which the aggregate Term A Commitments immediately prior to
such reduction exceed the aggregate unpaid principal amount of the Term A
Advances then outstanding.
(ii) On the Note Purchase Date, after giving effect to any Term B
Borrowing on such date, and from time to time thereafter upon each repayment or
prepayment of the Term B Advances, the aggregate Term B Commitments of the Term
B Lenders shall be automatically and permanently reduced, on a pro rata basis,
by an amount equal to the amount by which the aggregate Term B Commitments
immediately prior to such reduction exceed the aggregate unpaid principal amount
of the Term B Advances then outstanding.
(iii) The Letter of Credit Facility shall be permanently reduced
from time to time on the date of each reduction in the Revolving Credit Facility
by the amount, if any, by which the amount of the Letter of Credit Facility
exceeds the Revolving Credit Facility after giving effect to such reduction of
the Revolving Credit Facility.
(iv) The Swing Line Facility shall be permanently reduced from time
to time on the date of each reduction in the Revolving Credit Facility by the
amount, if any, by which the amount of the Swing Line Facility exceeds the
Revolving Credit Facility after giving effect to such reduction of the Revolving
Credit Facility.
50
50
SECTION 2.06. Prepayments. (a) Optional. The Borrower may, upon at
least three Business Day's notice to the Administrative Agent stating the
proposed date and aggregate principal amount of the prepayment, and if such
notice is given the Borrower shall, prepay the outstanding aggregate principal
amount of the Advances comprising part of the same Borrowing in whole or ratably
in part, together with accrued interest to the date of such prepayment on the
aggregate principal amount prepaid; provided, however, that (x) each partial
prepayment of Revolving Credit Advances shall be in an aggregate principal
amount of $2,000,000, each partial prepayment of Term Advances shall be in an
aggregate principal amount of $5,000,000, or, in each case, an integral multiple
of $1,000,000 in excess thereof and (y) if any prepayment of a Eurodollar Rate
Advance is made on a date other than the last day of an Interest Period for such
Advance, the Borrower shall also pay any amounts owing pursuant to Section
8.04(c); and provided, further, that a notice of prepayment may state that it is
conditioned upon the effectiveness of the closing of a credit facility, debt
financing or disposition of assets, in which case such notice may be revoked by
the Borrower by notice to the Administrative Agent prior to the date of the
proposed prepayment if such condition is not satisfied. Each such optional
prepayment of Term Advances shall be applied in the same manner as is provided
for mandatory prepayments of Term Advances in Section 2.06(b)(v).
(b) Mandatory. (i) Excess Cash Flow. The Borrower shall, on the
100th day following the end of each Fiscal Year (commencing following the
Borrower's Fiscal Year ending on December 31, 2000), prepay an aggregate
principal amount of the Advances comprising part of the same Borrowings in an
amount equal to fifty percent (50%) of the amount of Excess Cash Flow for such
Fiscal Year; provided, however, the aggregate amount of any prepayment of
Advances otherwise required under this subsection (i) shall not exceed the
amount which is $1 greater than the smallest aggregate prepayment of Advances
that would be required in order to reduce the Total Debt/EBITDA Ratio to 3.0:1
(after giving effect to such prepayment); and provided, further, that if the
Total Debt/EBITDA Ratio as of such day is less than 3.0:1, then no such
prepayment shall be required.
(ii) Net Cash Proceeds. The Borrower shall, on the date which is
three Business Days following the date of receipt of the Net Cash Proceeds by
the Borrower or any of its Subsidiaries from the following sources (or at any
time that a Default has occurred and is continuing, on such date of receipt),
prepay Advances as follows:
(A) Asset Dispositions. On the date of receipt of the Net Cash
Proceeds by the Borrower or any of its Subsidiaries from any Asset
Sale, unless a Reinvestment Notice shall have been delivered in respect
of such Asset Sale on or prior to the date which is three Business Days
following the date of receipt of such Net Cash Proceeds, the Borrower
shall prepay an aggregate principal amount of the Advances comprising
part of the same Borrowings in an amount equal to 100% of such Net Cash
Proceeds; provided, however, that, notwithstanding the foregoing (i)
the aggregate Net Cash Proceeds of
51
51
Asset Sales that may be excluded from the foregoing requirement
pursuant to a Reinvestment Notice shall not exceed $5,000,000 in any
Fiscal Year of the Borrower, or $10,000,000 in the aggregate during the
term of this Agreement and (ii) on each Reinvestment Prepayment Date
the Advances shall be prepaid, by an amount equal to the Reinvestment
Prepayment Amount with respect to the relevant Reinvestment Event, as
set forth in Section 2.06(b)(v);
(B) Debt. On the date of receipt of the Net Cash Proceeds by
the Borrower or any of its Subsidiaries from the incurrence or issuance
by the Borrower or any of its Subsidiaries of any Debt (other than Debt
incurred or issued pursuant to clauses (i ) to (ix) and clause (xi) of
Section 5.02(b)), the Borrower shall prepay an aggregate principal
amount of the Advances comprising part of the same Borrowings in an
amount equal to 100% of such Net Cash Proceeds; provided, however, that
the amount of any prepayment of Advances otherwise required under this
clause (B) shall not exceed the amount which is $1 greater than the
smallest aggregate prepayment of Advances that would be required on the
date of such prepayment to reduce the Senior Debt/EBITDA to 2.5:1
(after giving effect to such prepayment); and provided, further, that,
if the Senior Debt/EBITDA Ratio as of such date is less than 2.5:1,
then no amount of such Net Cash Proceeds need be prepaid;
(C) Equity Interests. On the date of receipt of the Net Cash
Proceeds by the Borrower or any of its Subsidiaries from the sale or
issuance by the Borrower or any of its Subsidiaries of any Equity
Interests (including, without limitation, receipt of any capital
contribution but excluding sales and issuances to employees of the
Borrower and its Subsidiaries (x) pursuant to the granting or exercise
of stock options or (y) to the extent of the Net Cash Proceeds from
such issuance or sale to employees is applied by the Borrower to
purchase the Equity Interests so issued as contemplated by Section
5.02(h)(i)(D)), the Borrower shall prepay an aggregate principal amount
of the Advances comprising part of the same Borrowings in an amount
equal to 50% of such Net Cash Proceeds; provided, however, that if the
Total Debt/EBITDA Ratio as of such date is less than 3.0:1, then the
Borrower shall repay such Advances in an amount equal to 25% of such
Net Cash Proceeds; and
(D) Extraordinary Receipts. On the date of receipt of the Net
Cash Proceeds by the Borrower or any of its Subsidiaries from any
Extraordinary Receipt (x) at any time that any Senior Subordinated
Notes are outstanding, in any amount and (y) thereafter, in excess of
$250,000, in each case, received by or paid to or for the account of
the Borrower or any of its Subsidiaries and not otherwise included in
clause (A), (B) or (C) above, the Borrower shall prepay an aggregate
principal amount of the Advances comprising part of the same Borrowings
in an amount equal to 100% of such Net Cash Proceeds.
52
52
(iii) Revolving Credit Facility. The Borrower shall, on each Business
Day, prepay an aggregate principal amount of the Revolving Credit Advances
comprising part of the same Borrowings, the Letter of Credit Advances and the
Swing Line Advances in an amount equal to the amount by which (A) the sum of the
aggregate principal amount of (x) the Revolving Credit Advances, (y) the Letter
of Credit Advances and (z) the Swing Line Advances then outstanding plus the
aggregate Available Amount of all Letters of Credit then outstanding exceeds (B)
the Revolving Credit Facility on such Business Day.
(iv) Letter of Credit Facility. The Borrower shall, on each Business
Day, pay to the Administrative Agent for deposit in the L/C Cash Collateral
Account an amount sufficient to cause the aggregate amount on deposit in the L/C
Cash Collateral Account to equal the amount by which the aggregate Available
Amount of all Letters of Credit then outstanding exceeds the Letter of Credit
Facility on such Business Day.
(v) Application of Prepayments; Application of Prepayments of Term
Advances; Term B Lenders' Option. (A) Each prepayment of Advances pursuant to
subsections (i) and (ii) of this Section 2.06(b) (and optional prepayments of
Term Advances pursuant to Section 2.06(a)) shall be applied (1) first, subject
to clause (C) below, pro rata between the Term Facilities until the Term
Advances are prepaid in full, and (2) second, to the Revolving Credit Facility
as set forth in clause (vi) below.
(B) Amounts applied to each Term Facility pursuant to subsection (A)
above, shall be applied (1) first, to any scheduled amortization installments of
such Term Facility which are due within twelve (12) months after the date of
such prepayment in the order of their maturity until such installments are
prepaid in full, and (2) second, pro rata to the remaining scheduled
amortization installments of such Term Facility until such installments are
prepaid in full.
(C) Notwithstanding anything to the contrary contained in the preceding
clause (A), any Term B Lender may elect not to accept its ratable share of any
prepayment of Term Loans which would otherwise be applied to the outstanding
Term B Advances of such Term B Lender pursuant to subsection (A) above by notice
given to the Administrative Agent not later than 11:00 A.M. (New York City time)
on the first Business Day prior to any date on which Term Loans are to be
prepaid pursuant to this Section 2.06 (such Term B Lender being a "DECLINING
LENDER"); provided, however, that in no event shall (x) the aggregate amount of
prepayments requested to be waived by Declining Lenders exceed the aggregate
principal amount of outstanding Term A Advances (before giving effect to any
prepayment of Term A Advances pursuant to the following sentence) or (y) the
amount of prepayments requested to be waived by any Declining Lender exceed such
Declining Lender's Pro Rata Share (calculated by reference to the Term B
Facility) of an amount equal to the aggregate principal amount of outstanding
Term A Advances (before giving effect to any prepayment of Term A Advances
53
53
pursuant to the following sentence). The amount of any prepayments waived by
Declining Lenders shall be applied to prepay outstanding Term A Advances in the
manner provided pursuant to subsection (B) above.
(vi) Revolving Credit Facility. Prepayments of the Revolving Credit
Facility made pursuant to clause (i), (ii) or (iii) above shall be first applied
to prepay Letter of Credit Advances then outstanding until such Advances are
paid in full, second applied to prepay Swing Line Advances then outstanding
until such Advances are paid in full, third applied to prepay Revolving Credit
Advances then outstanding comprising part of the same Borrowings until such
Advances are paid in full and fourth deposited in the L/C Cash Collateral
Account to cash collateralize 100% of the Available Amount of the Letters of
Credit then outstanding; and, in the case of prepayments of the Revolving Credit
Facility required pursuant to clause (i) or (ii) above, the amount remaining (if
any) after the prepayment in full of the Advances then outstanding and the 100%
cash collateralization of the aggregate Available Amount of Letters of Credit
then outstanding may be retained by the Borrower. Upon the drawing of any Letter
of Credit for which funds are on deposit in the L/C Cash Collateral Account,
such funds shall be applied to reimburse the Issuing Bank or Revolving Credit
Lenders, as applicable.
(vii) Deferred Prepayments. Notwithstanding anything to the contrary
contained in subsection (b)(ii) of this Section 2.06 or in Section 5.02(f), so
long as no Default shall have occurred and be continuing, if, on any date on
which a prepayment of Advances would otherwise be required pursuant to
subsection (b)(ii) of this Section 2.06 and the applicable subsections of
Section 5.02(e), the aggregate amount of Net Cash Proceeds or other amounts
otherwise required by such subsections to be applied to prepay Advances on such
date are less than or equal to $5,000,000, the Borrower may defer such
prepayment until the earlier of (x) the date on which the aggregate amount of
Net Cash Proceeds or other amounts otherwise required by such subsections to be
applied to prepay Advances exceeds $5,000,000 and (y) so long as any Senior
Subordinated Notes remain outstanding, the date which is 265 days following the
first date on which the Borrower or any of its Subsidiaries has received any
such Net Cash Proceeds. During such deferral period the Borrower may apply all
or any part of such aggregate amount to prepay Revolving Credit Advances and
may, subject to the fulfillment of the conditions set forth in Section 3.02,
reborrow such amounts (which amounts, to the extent originally constituting Net
Cash Proceeds, shall be deemed to retain their original character as Net Cash
Proceeds when so reborrowed for application as required by this Section 2.06).
Upon the occurrence of a Default, the Borrower shall immediately prepay Advances
in the amount of all Net Cash Proceeds received by the Borrower and other
amounts, as applicable, that are required to be applied to prepay Advances by
this Section 2.06 (without giving effect to the first and second sentences of
this subsection (b)(vii)) and Section 5.02(f) but which have not previously been
so applied.
(viii) Repatriation of Net Cash Proceeds. To the extent any or all of
the Net Cash Proceeds subject to Section 2.06(b)(i) or (ii) attributable to
non-U.S. Subsidiaries are
54
54
prohibited or delayed by applicable local law from being repatriated to the
United States, the portion of such Net Cash Proceeds so affected shall not be
required to be applied at the time provided above, and may be (but shall not be
required), at the election of the Borrower, deposited in an escrow account
maintained with a Lender and under the sole dominion and control of the
Administrative Agent pursuant to the terms of an escrow agreement satisfactory
in form and substance to the Administrative Agent, until such time as the
applicable local law will permit repatriation to the United States (and the
Borrower hereby agrees that it will, and will cause the applicable Subsidiary
to, promptly take all action required by the applicable local law to permit such
repatriation). If and when repatriation of any of such affected Net Cash
Proceeds is permitted under the applicable local law, such repatriation shall be
immediately effected and such repatriated Net Cash Proceeds will be applied in
the manner set forth in this Agreement.
(ix) Accrued Interest, Etc. All prepayments under this subsection (b)
shall be made together with accrued interest to the date of such prepayment on
the principal amount prepaid. If any payment of Eurodollar Rate Advances
otherwise required to be made under this Section 2.06(b) would be made on a day
other than the last day of the applicable Interest Period therefor, the Borrower
may direct the Administrative Agent to (and if so directed, the Administrative
Agent shall) deposit such payment in the Collateral Account until the last day
of the applicable Interest Period at which time the Administrative Agent shall
apply the amount of such payment to the prepayment of such Advances; provided,
however, that such Advances shall continue to bear interest as set forth in
Section 2.07 until the last day of the applicable Interest Period therefor.
SECTION 2.07. Interest. (a) Scheduled Interest. The Borrower shall pay
interest on the unpaid principal amount of each Advance owing to each Lender
from the date of such Advance until such principal amount shall be paid in full,
at the following rates per annum:
(i) Base Rate Advances. During such periods as such Advance is
a Base Rate Advance, a rate per annum equal at all times to the sum of
(A) the Base Rate in effect from time to time plus (B) the Applicable
Margin in effect from time to time, payable in arrears quarterly on the
last Business Day of each March, June, September and December during
such periods and on the date such Base Rate Advance shall be Converted
or paid in full.
(ii) Eurodollar Rate Advances. During such periods as such
Advance is a Eurodollar Rate Advance, a rate per annum equal at all
times during each Interest Period for such Advance to the sum of (A)
the Eurodollar Rate for such Interest Period for such Advance plus (B)
the Applicable Margin in effect on the first day of such Interest
Period, payable in arrears on the last day of such Interest Period and,
if such Interest Period has a duration of more than three months, on
each day that occurs during such Interest Period
55
55
every three months from the first day of such Interest Period and on
the date such Eurodollar Rate Advance shall be Converted or paid in
full.
(b) Default Interest. Upon the occurrence and during the continuance of
a Default, the Borrower shall pay interest on (i) the unpaid principal amount of
each Advance owing to each Lender, payable in arrears on the dates referred to
in clause (a)(i) or (a)(ii) above and on demand, at a rate per annum equal at
all times to 2% per annum above the rate per annum required to be paid on such
Advance pursuant to clause (a)(i) or (a)(ii) above and (ii) to the fullest
extent permitted by law, the amount of any interest, fee or other amount payable
under the Loan Documents that is not paid when due, from the date such amount
shall be due until such amount shall be paid in full, payable in arrears on the
date such amount shall be paid in full and on demand, at a rate per annum equal
at all times to 2% per annum above the rate per annum required to be paid, in
the case of interest, on the Type of Advance on which such interest has accrued
pursuant to clause (a)(i) or (a)(ii) above and, in all other cases, on Base Rate
Advances pursuant to clause (a)(i) above.
(c) Notice of Interest Period and Interest Rate. Promptly after receipt
of a Notice of Borrowing pursuant to Section 2.02(a), a notice of Conversion
pursuant to Section 2.09 or a notice of selection of an Interest Period pursuant
to the terms of the definition of "INTEREST PERIOD", the Administrative Agent
shall give notice to the Borrower and each Appropriate Lender of the applicable
Interest Period and the applicable interest rate determined by the
Administrative Agent for purposes of clause (a)(i) or (a)(ii) above.
SECTION 2.08. Fees. (a) Commitment Fee. The Borrower shall pay to the
Administrative Agent for the account of the Lenders a commitment fee, from the
date hereof in the case of each Initial Lender and from the effective date
specified in the Assignment and Acceptance pursuant to which it became a Lender
in the case of each other Lender until the Termination Date, payable in arrears
quarterly on the last Business Day of each March, June, September and December,
commencing March 31, 2000, and on the Termination Date, at the rate per annum
equal to the Applicable Percentage then in effect on the average daily unused
portion of each Appropriate Lender's Term A Commitment and Term B Commitment and
on the sum of the average daily Unused Revolving Credit Commitment of such
Lender plus its Pro Rata Share of the average daily outstanding Swing Line
Advances during such quarter; provided, however, that no commitment fee shall
accrue on any of the Commitments of a Defaulting Lender so long as such Lender
shall be a Defaulting Lender.
(b) Letter of Credit Fees, Etc. (i) The Borrower shall pay to the
Administrative Agent for the account of each Revolving Credit Lender a
commission, payable in arrears quarterly on the last Business Day of each March,
June, September and December, commencing March 31, 2000, and on the earliest to
occur of the full drawing, expiration, termination or cancellation of any Letter
of Credit and on the Termination Date, on such Lender's
56
56
Pro Rata Share of the average daily aggregate Available Amount during such
quarter of (A) all Standby Letters of Credit outstanding from time to time at a
rate per annum equal to the Applicable Margin then in effect for Eurodollar Rate
Advances under the Revolving Credit Facility and (B) all Trade Letters of Credit
then outstanding at a rate per annum equal to the Applicable Margin then in
effect for Eurodollar Rate Advances under the Revolving Credit Facility;
provided, however, that if the aggregate such commission for all Revolving
Credit Lenders for any Standby Letter of Credit or Trade Letter of Credit is
less than $500, then such commission shall instead be calculated for such Letter
of Credit as such Revolving Credit Lender's Pro Rata Share of $500.
(ii) The Borrower shall pay to the Issuing Bank, for its own account,
(A) an issuance fee, payable in arrears quarterly on the last Business Day of
each March, June, September and December, commencing March 31, 2000, and on the
Termination Date, on the average daily amount of its Letter of Credit Commitment
during such quarter, from the date hereof until the Termination Date, at the
rate of 0.25% per annum; provided, however, that if such commission for any
Letter of Credit is less than $100, then such issuance fee for such Letter of
Credit shall be $100 and (B) such other commissions, fronting fees, transfer
fees and other fees and charges in connection with the issuance or
administration of each Letter of Credit as the Borrower and the Issuing Bank
shall agree.
(c) Agents' Fees. The Borrower shall pay to each Agent for its own
account such fees as may from time to time be agreed between the Borrower and
such Agent.
SECTION 2.09. Conversion of Advances. (a) Optional. The Borrower may on
any Business Day, upon notice given to the Administrative Agent not later than
11:00 A.M. (New York City time) on the third Business Day prior to the date of
the proposed Conversion and subject to the provisions of Sections 2.07 and 2.10,
Convert all or any portion of the Advances of one Type comprising the same
Borrowing into Advances of the other Type; provided, however, that any
Conversion of Eurodollar Rate Advances into Base Rate Advances shall be made
only on the last day of an Interest Period for such Eurodollar Rate Advances,
any Conversion of Base Rate Advances into Eurodollar Rate Advances shall be in
an amount not less than the minimum amount specified in Section 2.02(c), no
Conversion of any Advances shall result in more separate Borrowings than
permitted under Section 2.02(c) and each Conversion of Advances comprising part
of the same Borrowing under any Facility shall be made ratably among the
Appropriate Lenders in accordance with their Commitments under such Facility.
Each such notice of Conversion shall, within the restrictions specified above,
specify (i) the date of such Conversion, (ii) the Advances to be Converted and
(iii) if such Conversion is into Eurodollar Rate Advances, the duration of the
initial Interest Period for such Advances. Each notice of Conversion shall be
irrevocable and binding on the Borrower.
57
57
(b) Mandatory. (i) On the date on which the aggregate unpaid principal
amount of Eurodollar Rate Advances comprising any Borrowing shall be reduced, by
payment or prepayment or otherwise, to less than $1,000,000, such Advances shall
automatically Convert into Base Rate Advances.
(ii) If the Borrower shall fail to select the duration of any Interest
Period for any Eurodollar Rate Advances in accordance with the provisions
contained in the definition of "INTEREST PERIOD" in Section 1.01, the
Administrative Agent will forthwith so notify the Borrower and the Appropriate
Lenders, whereupon each such Eurodollar Rate Advance will automatically, on the
last day of the then existing Interest Period therefor, Convert into a Base Rate
Advance.
(iii) Upon the occurrence and during the continuance of any Default,
(x) each Eurodollar Rate Advance will automatically, on the last day of the then
existing Interest Period therefor, Convert into a Base Rate Advance and (y) the
obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances shall be suspended.
SECTION 2.10. Increased Costs, Etc. (a) If, due to either (i) the
introduction of or any change in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request from any central
bank or other governmental authority (whether or not having the force of law),
there shall be any increase in the cost to any Lender Party of agreeing to make
or of making, funding or maintaining Eurodollar Rate Advances or of agreeing to
issue or of issuing or maintaining or participating in Letters of Credit or of
agreeing to make or of making or maintaining Letter of Credit Advances
(excluding, for purposes of this Section 2.10, any such increased costs
resulting from Taxes, Other Taxes or Excluded Taxes, as to which Section 2.12
shall govern), then the Borrower shall from time to time, upon demand by such
Lender Party (with a copy of such demand to the Administrative Agent), pay to
the Administrative Agent for the account of such Lender Party additional amounts
sufficient to compensate such Lender Party for such increased cost; provided,
however, that a Lender Party claiming additional amounts under this Section
2.10(a) agrees to use reasonable efforts (consistent with its internal policy
and legal and regulatory restrictions) to designate a different Applicable
Lending Office if the making of such a designation would avoid the need for, or
reduce the amount of, such increased cost that may thereafter accrue and would
not, in the reasonable judgment of such Lender Party, be otherwise
disadvantageous to such Lender Party. A certificate as to the amount of such
increased cost, submitted to the Borrower by such Lender Party, shall be
conclusive and binding for all purposes, absent manifest error.
(b) If, due to either (i) the introduction of or any change in or in
the interpretation of any law or regulation or (ii) the compliance with any
guideline or request from any central bank or other governmental authority
(whether or not having the force of law), there shall be any increase in the
amount of capital required or expected to be maintained by any Lender Party or
any corporation controlling such Lender Party as a result of or based upon the
58
58
existence of such Lender Party's commitment to lend or to issue or participate
in Letters of Credit hereunder and other commitments of such type or the
issuance or maintenance of or participation in the Letters of Credit (or similar
contingent obligations), then, upon demand by such Lender Party or such
corporation (with a copy of such demand to the Administrative Agent), the
Borrower shall pay to the Administrative Agent for the account of such Lender
Party, from time to time as specified by such Lender Party, additional amounts
sufficient to compensate such Lender Party in the light of such circumstances,
to the extent that such Lender Party reasonably determines such increase in
capital to be allocable to the existence of such Lender Party's commitment to
lend or to issue or participate in Letters of Credit hereunder or to the
issuance or maintenance of or participation in any Letters of Credit. A
certificate as to such amounts submitted to the Borrower by such Lender Party
shall be conclusive and binding for all purposes, absent manifest error.
(c) If, with respect to any Eurodollar Rate Advances under any
Facility, Lenders owed at least 50.1% of the then aggregate unpaid principal
amount thereof notify the Administrative Agent that the Eurodollar Rate for any
Interest Period for such Advances will not adequately reflect the cost to such
Lenders of making, funding or maintaining their Eurodollar Rate Advances for
such Interest Period, the Administrative Agent shall forthwith so notify the
Borrower and the Appropriate Lenders, whereupon (i) each such Eurodollar Rate
Advance under such Facility will automatically, on the last day of the then
existing Interest Period therefor, Convert into a Base Rate Advance and (ii) the
obligation of the Appropriate Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended until the Administrative Agent shall
notify the Borrower that such Lenders have determined that the circumstances
causing such suspension no longer exist.
(d) Notwithstanding any other provision of this Agreement, if the
introduction of or any change in or in the interpretation of any law or
regulation shall make it unlawful, or any central bank or other governmental
authority shall assert that it is unlawful, for any Lender or its Eurodollar
Lending Office to perform its obligations hereunder to make Eurodollar Rate
Advances or to continue to fund or maintain Eurodollar Rate Advances hereunder,
then, on notice thereof and demand therefor by such Lender to the Borrower
through the Administrative Agent, (i) each Eurodollar Rate Advance under each
Facility under which such Lender has a Commitment will automatically, upon such
demand, Convert into a Base Rate Advance and (ii) the obligation of the
Appropriate Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances shall be suspended until the Administrative Agent shall notify the
Borrower that such Lender has determined that the circumstances causing such
suspension no longer exist; provided, however, that, before making any such
demand, such Lender agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to designate a different
Eurodollar Lending Office if the making of such a designation would allow such
Lender or its Eurodollar Lending Office to continue to perform its obligations
to make Eurodollar Rate
59
59
Advances or to continue to fund or maintain Eurodollar Rate Advances and would
not, in the judgment of such Lender, be otherwise disadvantageous to such
Lender.
SECTION 2.11. Payments and Computations. (a) The Borrower shall make
each payment hereunder and under the Notes, irrespective of any right of
counterclaim or set-off (except as otherwise provided in Section 2.15), not
later than 11:00 A.M. (New York City time) on the day when due in U.S. dollars
to the Administrative Agent at the Administrative Agent's Account in same day
funds, with payments being received by the Administrative Agent after such time
being deemed to have been received on the next succeeding Business Day. The
Administrative Agent will promptly thereafter cause like funds to be distributed
(i) if such payment by the Borrower is in respect of principal, interest,
commitment fees or any other Obligation then payable hereunder and under the
Notes to more than one Lender Party, to such Lender Parties for the account of
their respective Applicable Lending Offices ratably in accordance with the
amounts of such respective Obligations then payable to such Lender Parties and
(ii) if such payment by the Borrower is in respect of any Obligation then
payable hereunder to one Lender Party, to such Lender Party for the account of
its Applicable Lending Office, in each case to be applied in accordance with the
terms of this Agreement. Upon its acceptance of an Assignment and Acceptance and
recording of the information contained therein in the Register pursuant to
Section 8.07(d), from and after the effective date of such Assignment and
Acceptance, the Administrative Agent shall make all payments hereunder and under
the Notes in respect of the interest assigned thereby to the Lender Party
assignee thereunder, and the parties to such Assignment and Acceptance shall
make all appropriate adjustments in such payments for periods prior to such
effective date directly between themselves.
(b) The Borrower hereby authorizes each Lender Party and each of its
Affiliates, if and to the extent payment owed to such Lender Party is not made
when due hereunder or, in the case of a Lender, under the Note held by such
Lender, to charge from time to time, to the fullest extent permitted by law,
against any or all of the Borrower's accounts with such Lender Party or such
Affiliate any amount so due.
(c) All computations of interest based on the Base Rate shall be made
by the Administrative Agent on the basis of a year of 365 or 366 days, as the
case may be, and all computations of interest based on the Eurodollar Rate or
the Federal Funds Rate and of fees and Letter of Credit commissions shall be
made by the Administrative Agent on the basis of a year of 360 days, in each
case for the actual number of days (including the first day but excluding the
last day) occurring in the period for which such interest, fees or commissions
are payable. Each determination by the Administrative Agent of an interest rate,
fee or commission hereunder shall be conclusive and binding for all purposes,
absent manifest error.
(d) Whenever any payment hereunder or under the Notes shall be stated
to be due on a day other than a Business Day, such payment shall be made on the
next succeeding
60
60
Business Day, and such extension of time shall in such case be included in the
computation of payment of interest or commitment fee, as the case may be;
provided, however, that, if such extension would cause payment of interest on or
principal of Eurodollar Rate Advances to be made in the next following calendar
month, such payment shall be made on the next preceding Business Day.
(e) Unless the Administrative Agent shall have received notice from the
Borrower prior to the date on which any payment is due to any Lender Party
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each such Lender Party
on such due date an amount equal to the amount then due such Lender Party. If
and to the extent the Borrower shall not have so made such payment in full to
the Administrative Agent, each such Lender Party shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Lender
Party together with interest thereon, for each day from the date such amount is
distributed to such Lender Party until the date such Lender Party repays such
amount to the Administrative Agent, at the Federal Funds Rate.
(f) If the Administrative Agent receives funds for application to the
Obligations under the Loan Documents under circumstances for which the Loan
Documents do not specify the Advances or the Facility to which, or the manner in
which, such funds are to be applied, the Administrative Agent may, but shall not
be obligated to, elect to distribute such funds to each Lender Party ratably in
accordance with such Lender Party's proportionate share of the principal amount
of all outstanding Advances and the Available Amount of all Letters of Credit
then outstanding, in repayment or prepayment of such of the outstanding Advances
or other Obligations owed to such Lender Party, and for application to such
principal installments, as the Administrative Agent shall direct.
SECTION 2.12. Taxes. (a) Except as set forth in this Section 2.12, any
and all payments by the Borrower hereunder or under the Notes shall be made, in
accordance with Section 2.11, and free and clear of and without deduction for
any and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding, in the case
of each Lender Party and each Agent, taxes that are imposed on overall net
income, net profits or capital (and franchise or similar taxes imposed as a
result of doing business in lieu thereof, whether measured by income, profits,
receipts or capital) by the country, state or any political subdivision thereof
(x) under the laws of which such Lender Party or such Agent, as the case may be,
is organized or is a citizen or resident, or (y) in which such Lender Party or
such Agent, as the case may be, is doing business or has a permanent
establishment (all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities in respect of payments hereunder or under
the Notes being hereinafter referred to as "TAXES" and all such excluded taxes
being referred to herein as "EXCLUDED TAXES"). If the Borrower shall be required
61
61
by law to deduct any Taxes from or in respect of any sum payable hereunder or
under any Note to any Lender Party or any Agent, (i) subject to Section 2.12(g),
the sum payable by the Borrower shall be increased as may be necessary so that
after the Borrower and the Administrative Agent have made all required
deductions (including deductions applicable to additional sums payable under
this Section 2.12) such Lender Party or such 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 all such deductions and (iii) the Borrower
shall pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any present or future stamp,
documentary, excise, property or similar taxes, charges or levies that arise
from any payment made hereunder or under the Notes or from the execution,
delivery or registration of, performance under, or otherwise with respect to,
this Agreement or the Notes (hereinafter referred to as "OTHER TAXES").
(c) Subject to Section 2.12(g), the Borrower shall indemnify each
Lender Party and each Agent for and hold them harmless against the full amount
of Taxes and Other Taxes, imposed on or paid by such Lender Party or such Agent
(as the case may be) and any liability (including penalties, additions to tax,
interest and expenses) arising therefrom or with respect thereto. This
indemnification shall be made within 30 days from the date such Lender Party or
such Agent (as the case may be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes, the Borrower
shall furnish to the Administrative Agent, at its address referred to in Section
8.02, the original or a certified copy of a receipt (or other evidence of
payment reasonably satisfactory to the Administrative Agent) evidencing such
payment. In the case of any payment hereunder or under the Notes by or on behalf
of the Borrower through an account or branch outside the United States or by or
on behalf of the Borrower by a payor that is not a United States person, if the
Borrower determines that no Taxes are payable in respect thereof, the Borrower
shall furnish, or shall cause such payor to furnish, to the Administrative
Agent, at such address, an opinion of counsel acceptable to the Administrative
Agent stating that such payment is exempt from Taxes. For purposes of this
Section 2.12, the terms "UNITED STATES" and "UNITED STATES PERSON" shall have
the meanings specified in Section 7701 of the Internal Revenue Code.
(e) Each Lender Party organized under the laws of a jurisdiction
outside the United States shall, on or prior to the date of its execution and
delivery of this Agreement in the case of each Initial Lender Party and on the
date of the Assignment and Acceptance pursuant to which it becomes a Lender
Party in the case of each other Lender Party, provide each of the Administrative
Agent and the Borrower with (i) two original Internal Revenue Service forms
W-8BEN or W-8ECI, as applicable (or any successor or other applicable form
prescribed
62
62
by the Internal Revenue Service), or (ii) in the case of a Lender Party claiming
exemption from U.S. federal withholding tax under Section 871(h) or 881(c) of
the Code with respect to payments of "portfolio interest," a statement
substantially in the form of Exhibit H and two copies of Internal Revenue
Service Form W-8BEN (or any successor or other applicable form prescribed by the
Internal Revenue Service), certifying that such Lender Party is exempt from or
entitled to a reduced rate of United States withholding tax on payments pursuant
to this Agreement or the Notes. Upon request in writing by the Borrower, each
such Lender Party shall deliver to the Borrower and Administrative Agent
(provided that such Lender Party remains lawfully able to do so), two further
duly executed forms and statements, properly completed in all material respects,
at or before the time any such form or statement expires or becomes obsolete, or
as otherwise reasonably requested in writing by the Borrower. Each such Lender
Party shall promptly notify the Borrower at any time it determines that it is no
longer in a position to provide any previously delivered certificate to the
Borrower (or any other form or certification adopted by the U.S. taxing
authorities for such purpose). If the forms provided by a Lender Party at the
time such Lender Party first becomes a party to this Agreement indicate a United
States interest withholding tax rate in excess of zero, withholding tax at such
rate shall be considered excluded from Taxes unless and until such Lender Party
provides the appropriate forms certifying that a lesser rate applies, whereupon
withholding tax at such lesser rate only shall be considered excluded from Taxes
for periods governed by such forms; provided, however, that if, at the effective
date of the Assignment and Acceptance pursuant to which a Lender Party becomes a
party to this Agreement, the Lender Party assignor was entitled to payments
under subsection (a) of this Section 2.12 in respect of United States
withholding tax with respect to interest paid at such date, then, to such
extent, the term Taxes shall include (in addition to withholding taxes that may
be imposed in the future or other amounts otherwise includable in Taxes) United
States withholding tax, if any, applicable with respect to the Lender Party
assignee on such date. If any form or document referred to in this subsection
(e) requires the disclosure of information, other than information necessary to
compute the tax payable and information required on the date hereof by Internal
Revenue Service forms W-8BEN or W-8ECI (or the related certificate described
above), that the applicable Lender Party reasonably considers to be
confidential, such Lender Party shall give notice thereof to the Borrower and
shall not be obligated to include in such form or document such confidential
information.
(f) Each Lender Party which is a United States person shall, on or
prior to the date of its execution and delivery of this Agreement in the case of
each Initial Lender Party and on the date of the Assignment and Acceptance
pursuant to which it becomes a Lender Party in the case of each other Lender
Party, deliver to the Borrower and the Administrative Agent two duly completed
copies of United States Internal Revenue Service Form W-9 (or any successor or
other applicable form prescribed by the Internal Revenue Service) unless it
establishes to the reasonable satisfaction of the Borrower that it is otherwise
eligible for an exemption from backup withholding tax or other applicable
withholding tax. Upon request in writing by the Borrower, each such Lender Party
shall deliver to the Borrower and Administrative Agent (provided that
63
63
such Lender Party remains lawfully able to do so), two further duly executed
forms and statements, properly completed in all material respects, at or before
the time any such form or statement expires or becomes obsolete, or otherwise as
reasonably requested by the Borrower. Each such Lender Party shall promptly
notify the Borrower at any time it determines that it is no longer in a position
to provide any previously delivered certificate to the Borrower (or any other
form or certification adopted by the U.S. taxing authorities for such purpose).
(g) For any period with respect to which a Lender Party has failed to
provide the Borrower with the appropriate form described in subsection (e) or
(f) above (other than if such failure is due to a change in law occurring after
the date on which a form originally was required to be provided), such Lender
Party shall not be entitled to indemnification under subsection (a) or (c) of
this Section 2.12 with respect to Taxes imposed by the United States by reason
of such failure; provided, however, that should a Lender Party become subject to
Taxes because of its failure to deliver a form required hereunder, the Borrower
shall take such steps as such Lender Party shall reasonably request to assist
such Lender Party to recover such Taxes.
(h) Each Lender Party which is not a United States person, agrees to
indemnify and hold harmless the Borrower from and against any and all taxes,
related penalties and interest, and reasonable out-of-pocket costs incurred by
the Borrower as a result of a failure by the Borrower to comply with its
obligations to deduct or withhold any Taxes from any payment made pursuant to
this Agreement, which failure resulted solely from the Borrower's reasonable
reliance on information provided by such Lender Party on a form referred to in
Section 2.12(e) or (f).
(i) If any Lender Party determines, in its sole discretion, that it has
finally and irrevocably received a refund of any Taxes that have been paid or
reimbursed by the Borrower pursuant to Section 2.12(a) or (c) in respect of
payments hereunder or under the Notes that it would otherwise not have obtained
and that would result in total payments made under this Section 2.12 exceeding
that amount needed to make such Lender Party whole, such Lender Party shall, to
the extent that it determines in its sole discretion that it can do so without
prejudice to the retention of the amount of such refund, pay to the Borrower
following actual receipt of such refund and without any interest thereon, the
amount of such refund after deducting therefrom all out-of-pocket expenses
incurred by or on behalf of such Lender Party in securing such refund; provided
that the Borrower agrees, upon request of such Lender Party, to return the
amount of such refund to such Lender Party, together with the amount of all
additional out-of-pocket expenses, penalties, interest or other charges in
respect thereof, if such Lender Party is required to repay or otherwise loses
the benefit of such refund. Nothing in this Section 2.12 shall be construed to
interfere with the right of a Lender Party to arrange its tax affairs in
whatever manner it thinks fit or require any Lender Party to claim any refund,
or to require any Lender
64
64
Party to make available to the Borrower or Administrative Agent any of its tax
returns or any other information relating to Taxes that it deems to be
confidential.
SECTION 2.13. Sharing of Payments, Etc. If any Lender Party shall
obtain at any time any payment (whether voluntary, involuntary, through the
exercise of any right of set-off, or otherwise, other than as a result of an
assignment pursuant to Section 8.07) (a) on account of Obligations due and
payable to such Lender Party hereunder and under the Notes at such time in
excess of its ratable share (according to the proportion of (i) the amount of
such Obligations due and payable to such Lender Party at such time to (ii) the
aggregate amount of the Obligations due and payable to all Lender Parties
hereunder and under the Notes at such time) of payments on account of the
Obligations due and payable to all Lender Parties hereunder and under the Notes
at such time obtained by all the Lender Parties at such time or (b) on account
of Obligations owing (but not due and payable) to such Lender Party hereunder
and under the Notes at such time in excess of its ratable share (according to
the proportion of (i) the amount of such Obligations owing to such Lender Party
at such time to (ii) the aggregate amount of the Obligations owing (but not due
and payable) to all Lender Parties hereunder and under the Notes at such time)
of payments on account of the Obligations owing (but not due and payable) to all
Lender Parties hereunder and under the Notes at such time obtained by all of the
Lender Parties at such time, such Lender Party shall forthwith purchase from the
other Lender Parties such interests or participating interests in the
Obligations due and payable or owing to them, as the case may be, as shall be
necessary to cause such purchasing Lender Party to share the excess payment
ratably with each of them; provided, however, that if all or any portion of such
excess payment is thereafter recovered from such purchasing Lender Party, such
purchase from each other Lender Party shall be rescinded and such other Lender
Party shall repay to the purchasing Lender Party the purchase price to the
extent of such Lender Party's ratable share (according to the proportion of (i)
the purchase price paid to such Lender Party to (ii) the aggregate purchase
price paid to all Lender Parties) of such recovery together with an amount equal
to such Lender Party's ratable share (according to the proportion of (i) the
amount of such other Lender Party's required repayment to (ii) the total amount
so recovered from the purchasing Lender Party) of any interest or other amount
paid or payable by the purchasing Lender Party in respect of the total amount so
recovered; provided, further that, so long as the Obligations under the Loan
Documents shall not have been accelerated, any excess payment received by any
Appropriate Lender shall be shared on a pro rata basis only with other
Appropriate Lenders. The Borrower agrees that any Lender Party so purchasing an
interest or participating interest from another Lender Party pursuant to this
Section 2.13 may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of set-off) with respect to such interest
or participating interest, as the case may be, as fully as if such Lender Party
were the direct creditor of the Borrower in the amount of such interest or
participating interest, as the case may be.
SECTION 2.14. Use of Proceeds. The proceeds of the Advances and
issuances of Letters of Credit shall be available (and the Borrower agrees that
it shall use such proceeds
65
65
and Letters of Credit) solely to fund fees and expenses in connection with the
Acquisition, to refinance certain Existing Debt, to finance the Borrower's
purchase of the Senior Subordinated Notes which are tendered pursuant to the
Offer to Purchase, to finance the purchase by the Borrower and its Subsidiaries
of Permitted Acquisitions and to provide working capital for the Borrower and
its Subsidiaries.
SECTION 2.15. Defaulting Lenders. (a) In the event that, at any one
time, (i) any Lender Party shall be a Defaulting Lender, (ii) such Defaulting
Lender shall owe a Defaulted Advance to the Borrower and (iii) the Borrower
shall be required to make any payment hereunder or under any other Loan Document
to or for the account of such Defaulting Lender, then the Borrower may, so long
as no Default shall occur or be continuing at such time and to the fullest
extent permitted by applicable law, set off and otherwise apply the Obligation
of the Borrower to make such payment to or for the account of such Defaulting
Lender against the obligation of such Defaulting Lender to make such Defaulted
Advance. In the event that, on any date, the Borrower shall so set off and
otherwise apply its obligation to make any such payment against the obligation
of such Defaulting Lender to make any such Defaulted Advance on or prior to such
date, the amount so set off and otherwise applied by the Borrower shall
constitute for all purposes of this Agreement and the other Loan Documents an
Advance by such Defaulting Lender made on the date of such setoff under the
Facility pursuant to which such Defaulted Advance was originally required to
have been made pursuant to Section 2.01. Such Advance shall be considered, for
all purposes of this Agreement, to comprise part of the Borrowing in connection
with which such Defaulted Advance was originally required to have been made
pursuant to Section 2.01, even if the other Advances comprising such Borrowing
shall be Eurodollar Rate Advances on the date such Advance is deemed to be made
pursuant to this subsection (a). The Borrower shall notify the Administrative
Agent at any time the Borrower exercises its right of set-off pursuant to this
subsection (a) and shall set forth in such notice (A) the name of the Defaulting
Lender and the Defaulted Advance required to be made by such Defaulting Lender
and (B) the amount set off and otherwise applied in respect of such Defaulted
Advance pursuant to this subsection (a). Any portion of such payment otherwise
required to be made by the Borrower to or for the account of such Defaulting
Lender which is paid by the Borrower, after giving effect to the amount set off
and otherwise applied by the Borrower pursuant to this subsection (a), shall be
applied by the Administrative Agent as specified in subsection (b) or (c) of
this Section 2.15.
(b) In the event that, at any one time, (i) any Lender Party shall be a
Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted Amount to
any Agent or any of the other Lender Parties and (iii) the Borrower shall make
any payment hereunder or under any other Loan Document to the Administrative
Agent for the account of such Defaulting Lender, then the Administrative Agent
may, on its behalf or on behalf of such other Agents or such other Lender
Parties and to the fullest extent permitted by applicable law, apply at such
time the amount so paid by the Borrower to or for the account of such Defaulting
Lender to the
66
66
payment of each such Defaulted Amount to the extent required to pay such
Defaulted Amount. In the event that the Administrative Agent shall so apply any
such amount to the payment of any such Defaulted Amount on any date, the amount
so applied by the Administrative Agent shall constitute for all purposes of this
Agreement and the other Loan Documents payment, to such extent, of such
Defaulted Amount on such date. Any such amount so applied by the Administrative
Agent shall be retained by the Administrative Agent or distributed by the
Administrative Agent to such other Agents or such other Lender Parties, ratably
in accordance with the respective portions of such Defaulted Amounts payable at
such time to the Administrative Agent, such other Agents and such other Lender
Parties and, if the amount of such payment made by the Borrower shall at such
time be insufficient to pay all Defaulted Amounts owing at such time to the
Administrative Agent, such other Agents and such other Lender Parties, in the
following order of priority:
(i) first, to the Agents for any Defaulted Amounts then owing
to them, in their capacities as such, ratably in accordance with such
respective Defaulted Amounts then owing to the Agents;
(ii) second, to the Issuing Bank and the Swing Line Bank for
any Defaulted Amounts then owing to them, in their capacities as such,
ratably in accordance with such respective Defaulted Amounts then owing
to the Issuing Bank and the Swing Line Bank; and
(iii) third, to any other Lender Parties for any Defaulted
Amounts then owing to such other Lender Parties, ratably in accordance
with such respective Defaulted Amounts then owing to such other Lender
Parties.
Any portion of such amount paid by the Borrower for the account of such
Defaulting Lender remaining, after giving effect to the amount applied by the
Administrative Agent pursuant to this subsection (b), shall be applied by the
Administrative Agent as specified in subsection (c) of this Section 2.15.
(c) In the event that, at any one time, (i) any Lender Party shall be
a Defaulting Lender, (ii) such Defaulting Lender shall not owe a Defaulted
Advance or a Defaulted Amount and (iii) the Borrower, any Agent or any other
Lender Party shall be required to pay or distribute any amount hereunder or
under any other Loan Document to or for the account of such Defaulting Lender,
then the Borrower or such Agent or such other Lender Party shall pay such amount
to the Administrative Agent to be held by the Administrative Agent, to the
fullest extent permitted by applicable law, in escrow or the Administrative
Agent shall, to the fullest extent permitted by applicable law, hold in escrow
such amount otherwise held by it. Any funds held by the Administrative Agent in
escrow under this subsection (c) shall be deposited by the Administrative Agent
in an account with an institution designated by the Administrative Agent, in the
name and under the control of the Administrative Agent, but subject to the
provisions of
67
67
this subsection (c). The terms applicable to such account, including the rate of
interest payable with respect to the credit balance of such account from time to
time, shall be such designated institution's standard terms applicable to escrow
accounts maintained with it. Any interest credited to such account from time to
time shall be held by the Administrative Agent in escrow under, and applied by
the Administrative Agent from time to time in accordance with the provisions of,
this subsection (c). The Administrative Agent shall, to the fullest extent
permitted by applicable law, apply all funds so held in escrow from time to time
to the extent necessary to make any Advances required to be made by such
Defaulting Lender and to pay any amount payable by such Defaulting Lender
hereunder and under the other Loan Documents to the Administrative Agent or any
other Lender Party, as and when such Advances or amounts are required to be made
or paid and, if the amount so held in escrow shall at any time be insufficient
to make and pay all such Advances and amounts required to be made or paid at
such time, in the following order of priority:
(i) first, to the Agents for any amounts then due and payable
by such Defaulting Lender to them hereunder, in their capacities as
such, ratably in accordance with such respective amounts then due and
payable to the Agents;
(ii) second, to the Issuing Bank and the Swing Line Bank for
any amounts then due and payable to them hereunder, in their capacities
as such, by such Defaulting Lender, ratably in accordance with such
respective amounts then due and payable to the Issuing Bank and the
Swing Line Bank;
(iii) third, to any other Lender Parties for any amount then
due and payable by such Defaulting Lender to such other Lender Parties
hereunder, ratably in accordance with such respective amounts then due
and payable to such other Lender Parties; and
(iv) fourth, to the Borrower for any Advance then required to
be made by such Defaulting Lender pursuant to a Commitment of such
Defaulting Lender.
In the event that any Lender Party that is a Defaulting Lender shall, at any
time, cease to be a Defaulting Lender, any funds held by the Administrative
Agent in escrow at such time with respect to such Lender Party shall be
distributed by the Administrative Agent to such Lender Party and applied by such
Lender Party to the Obligations owing to such Lender Party at such time under
this Agreement and the other Loan Documents ratably in accordance with the
respective amounts of such Obligations outstanding at such time.
(d) The rights and remedies against a Defaulting Lender under this
Section 2.15 are in addition to other rights and remedies that the Borrower may
have against such Defaulting Lender with respect to any Defaulted Advance and
that any Agent or any Lender Party may have against such Defaulting Lender with
respect to any Defaulted Amount.
68
68
ARTICLE III
CONDITIONS OF LENDING AND
ISSUANCES OF LETTERS OF CREDIT
SECTION 3.01. Conditions Precedent to Initial Extension of
Credit. The obligation of each Lender to make an Advance or of the Issuing Bank
to issue a Letter of Credit on the occasion of the Initial Extension of Credit
hereunder is subject to the satisfaction of the following conditions precedent
before or concurrently with the Initial Extension of Credit:
(a) The Administrative Agent shall have received on or before
the day of the Initial Extension of Credit the following, each dated
such day (unless otherwise specified), in form and substance
satisfactory to the Joint Lead Arrangers (unless otherwise specified)
and (except for the Notes) in sufficient copies for each Lender Party:
(i) The Notes payable to the order of the Lenders.
(ii) A security agreement in substantially the form
of Exhibit D hereto (together with each other security
agreement and security agreement supplement delivered pursuant
to Section 5.01(j), in each case as amended, the "SECURITY
AGREEMENT"), duly executed by each Loan Party, together with:
(A) certificates representing the Pledged
Shares referred to therein accompanied by undated
stock powers executed in blank and instruments
evidencing the Pledged Debt indorsed in blank, if
any,
(B) proper financing statements, duly
executed and in form for filing under the Uniform
Commercial Code of all jurisdictions that the Joint
Lead Arrangers may deem necessary or desirable in
order to perfect and protect the first priority liens
and security interests created under the Security
Agreement, covering the Collateral described in the
Security Agreement,
(C) completed requests for information,
dated on or before the date hereof, listing all
effective financing statements filed in the
jurisdictions referred to in clause (B) above that
name any Loan Party as debtor, together with copies
of such financing statements,
(D) proper other documents, duly executed
and in form for recording and filing that the Joint
Lead Arrangers and the Administrative
69
69
Agent may deem necessary or desirable in order to
perfect and protect the Liens created by the Security
Agreement, including any Intellectual Property
Security Agreements required thereunder (but
excluding any such filings, recordings or other
actions which are specifically described in Section
5.01(q)), and
(E) evidence that all other action that the
Joint Lead Arrangers may deem necessary or desirable
in order to perfect and protect the first priority
liens and security interests created under the
Security Agreement has been taken, including,
without limitation, receipt of duly executed payoff
letters and UCC-3 termination statements from the
holders of Existing Debt (other than Surviving Debt),
and landlords' and bailees' waiver and consent
agreements.
(iii) A guaranty in substantially the form of Exhibit
E hereto (together with each other guaranty and guaranty
supplement delivered pursuant to Section 5.01(j), in each case
as amended, the "SUBSIDIARY GUARANTY"), duly executed by each
Subsidiary Guarantor.
(iv) Certified copies of the resolutions of the Board
of Directors of each Loan Party approving the Transaction
(other than the Offer to Purchase) and each Transaction
Document to which it is or is to be a party, and of all
documents evidencing other necessary corporate action and
governmental and other third party approvals and consents, if
any, with respect to the Transaction and each Transaction
Document to which it is or is to be a party.
(v) A copy of a certificate of the Secretary of State
of the jurisdiction of incorporation of each Loan Party, dated
reasonably near the date of the Initial Extension of Credit,
certifying (A) as to a true and correct copy of the charter of
such Loan Party and each amendment thereto on file in such
Secretary's office and (B) that (1) such amendments are the
only amendments to such Loan Party's charter on file in such
Secretary's office, (2) such Loan Party has paid all franchise
taxes to the date of such certificate and (C) such Loan Party
is duly incorporated and in good standing or presently
subsisting under the laws of the State of the jurisdiction of
its incorporation.
(vi) A copy of a certificate of the Secretary of
State of each state where each Loan Party owns or leases any
material real property, dated reasonably near the date of the
Initial Extension of Credit, stating that such Loan Party is
duly qualified and in good standing as a foreign corporation
in such State and has filed all annual reports required to be
filed to the date of such certificate.
70
70
(vii) A certificate of each Loan Party, signed on
behalf of such Loan Party by a Responsible Officer, dated the
date of the Initial Extension of Credit (the statements made
in which certificate shall be true on and as of the date of
the Initial Extension of Credit), certifying as to (A) the
absence of any amendments to the charter of such Loan Party
since the date of the Secretary of State's certificate
referred to in Section 3.01(a)(vi), (B) a true and correct
copy of the bylaws of such Loan Party as in effect on the date
on which the resolutions referred to in Section 3.01(a)(v)
were adopted and on the date of the Initial Extension of
Credit, (C) the due incorporation and good standing or valid
existence of such Loan Party as a corporation organized under
the laws of the jurisdiction of its incorporation, and the
absence of any proceeding for the dissolution or liquidation
of such Loan Party, (D) the names and true signatures of the
officers of such Loan Party authorized to sign any Transaction
Document to which it is or is to be a party, (E) the truth in
all material respects of the representations and warranties
contained in the Loan Documents as though made on and as of
the date of the Initial Extension of Credit and (F) the
absence of any event occurring and continuing, or resulting
from the Initial Extension of Credit, that constitutes a
Default.
(viii) Certified copies of each of the Related
Documents which the Borrower or any of its Subsidiaries has
entered into on or prior to the date of the Initial Extension
of Credit, duly executed by the parties thereto, together with
all agreements, instruments and other documents delivered in
connection therewith as the Joint Lead Arrangers and the
Administrative Agent shall request.
(ix) Certificate, in substantially the form of
Exhibit F hereto, attesting to the Solvency of the Borrower
(and of each other Loan Party) before and after giving effect
to the Transaction, from the Chief Financial Officer of the
Borrower.
(x) Such financial, business and other information
regarding each Loan Party and its Subsidiaries as the Lender
Parties shall have reasonably requested, including, without
limitation, information as to possible contingent liabilities,
tax matters, environmental matters, obligations under Plans,
Multiemployer Plans and Welfare Plans, collective bargaining
agreements and other arrangements with employees, audited
annual financial statements dated December 31, 1998, interim
financial statements dated the end of the most recent fiscal
quarter for which financial statements are available (or, in
the event the Lender Parties' due diligence review reveals
material changes since such financial statements, as of a
later date within 45 days of the day of the Initial Extension
of Credit), pro forma financial statements as to the Borrower
and forecasts prepared
71
71
by management of the Company, in form and substance
satisfactory to the Lender Parties, of balance sheets, income
statements and cash flow statements on an annual basis for
each year thereafter until the Termination Date.
(xi) Evidence of insurance naming the Administrative
Agent as additional insured and loss payee with such
responsible and reputable insurance companies or associations,
and in such amounts and covering such risks, as is
satisfactory to the Joint Lead Arrangers.
(xii) Certified copies of the employment agreements
with Xxxxxx X. Xxxxxx and Xxxx X. Xxxxxxx and any other
written compensation arrangements between such executive
officer and any Loan Party or any of its Subsidiaries.
(xiii) Certified copies of all Material Contracts of
the type described under clause (iv) of the definition of such
term of each Loan Party and its Subsidiaries.
(xiv) A Notice of Borrowing or Notice of Issuance, as
applicable, relating to the Initial Extension of Credit.
(xv) A favorable opinion of Fried, Frank, Harris,
Xxxxxxx & Xxxxxxxx, counsel for the Loan Parties, in
substantially the form of Exhibit G hereto and as to such
other matters as any Lender Party through the Administrative
Agent may reasonably request.
(xvi) A favorable opinion of each local counsel to
the Lender Parties in the States of Illinois and New
Hampshire, which counsel shall be reasonable satisfactory to
the Joint Lead Arrangers, as to such matters as the Lender
Parties through the Administrative Agent may reasonably
request.
(b) The Joint Lead Arrangers shall have received satisfactory
evidence that the Acquisition has been consummated in all material
respects in accordance with the Acquisition Agreement and that each of
the Equity Investors has complied in all material respects with all of
its covenants and obligations under the Acquisition Agreement required
to be performed by it on or prior to the date of the Acquisition.
(c) The Lender Parties shall be satisfied with the corporate
and legal structure and capitalization of each Loan Party and each of
its Subsidiaries the Equity Interests in which Subsidiaries is being
pledged pursuant to the Loan Documents, including the terms and
conditions of the charter, bylaws and each class of Equity Interest in
each Loan Party
72
72
and each such Subsidiary and of each agreement or instrument relating
to such structure or capitalization.
(d) All Existing Debt, other than Surviving Debt, shall have
been prepaid, redeemed or defeased in full or otherwise satisfied and
extinguished.
(e) Before giving effect to the Transaction, there shall not
have occurred or become known any condition or event that would
reasonably be expected to result in a Material Adverse Change.
(f) There shall exist no action, suit, investigation,
litigation or proceeding affecting any Loan Party or any of its
Subsidiaries pending or threatened before any court, governmental
agency or arbitrator that (i) would reasonably be expected to have a
Material Adverse Effect or (ii) purports to affect the legality,
validity or enforceability of any Transaction Document or the
consummation of the Transaction, and there shall have been no adverse
change in the status, or financial effect on any Loan Party or any of
its Subsidiaries, of the Disclosed Litigation from that described on
Schedule 4.01(f) hereto.
(g) All governmental and third party consents and approvals
necessary in connection with the Transaction shall have been obtained
(without the imposition of any conditions that are not acceptable to
the Lender Parties), and shall remain in effect; all applicable waiting
periods in connection with the Transaction shall have expired without
any action being taken by any competent authority, and no law or
regulation shall be applicable in the judgment of the Lender Parties,
in each case that restrains, prevents or imposes materially adverse
conditions upon the Transaction or the rights of the Loan Parties or
their Subsidiaries freely to transfer or otherwise dispose of, or to
create any Lien on, any properties now owned or hereafter acquired by
any of them.
(h) The Borrower shall have paid all accrued fees of the
Agents and the Lender Parties and all accrued expenses of the Agents
(including the accrued fees and expenses of counsel to the Syndication
Agent).
(i) There shall not have occurred any material disruption or
material adverse change in or affecting the United States financial,
banking, or capital market conditions generally from those in effect on
November 24, 1999, that, individually or in the aggregate, have
adversely affected the consummation of the Transactions; and no banking
moratorium shall have been declared by United States federal or New
York state banking authorities which shall be continuing.
SECTION 3.02. Conditions Precedent to Each Borrowing and Issuance and
Renewal. The obligation of each Appropriate Lender to make an Advance (other
than a Letter of
73
73
Credit Advance made by the Issuing Bank or a Revolving Credit Lender pursuant to
Section 2.03(c) and a Swing Line Advance made by a Revolving Credit Lender
pursuant to Section 2.02(b)) on the occasion of each Borrowing (including the
initial Borrowing), and the obligation of the Issuing Bank to issue a Letter of
Credit (including the initial issuance) or renew a Letter of Credit and the
right of the Borrower to request a Swing Line Borrowing, shall be subject to the
further conditions precedent that on the date of such Borrowing or issuance or
renewal (a) the following statements shall be true (and each of the giving of
the applicable Notice of Borrowing, Notice of Swing Line Borrowing, Notice of
Issuance or Notice of Renewal and the acceptance by the Borrower of the proceeds
of such Borrowing or of such Letter of Credit or the renewal of such Letter of
Credit shall constitute a representation and warranty by the Borrower that both
on the date of such notice and on the date of such Borrowing or issuance or
renewal such statements are true):
(i) the representations and warranties contained in each Loan
Document are correct on and as of such date, before and after giving
effect to such Borrowing or issuance or renewal and to the application
of the proceeds therefrom, as though made on and as of such date, other
than any such representations or warranties that, by their terms, refer
to a specific date other than the date of such Borrowing or issuance or
renewal, in which case as of such specific date; and
(ii) no Default has occurred and is continuing, or would
result from such Borrowing or issuance or renewal or from the
application of the proceeds therefrom;
(b) the obligations of each Revolving Credit Lender to make Revolving
Credit Advances, shall be subject to the further condition precedent that:
(i) on the Effective Date, the aggregate amount of such
Revolving Credit Borrowing shall not exceed $15,000,000; and
(ii) on any date on which any Revolving Credit Borrowing has
been requested to fund any portion of the purchase price to be paid by
the Borrower or any of its Subsidiaries in connection with a Permitted
Acquisition, (A) no amount of the Term A Commitments shall remain
undrawn (after giving effect to any Term A Advances made on such date);
and (B) after giving effect to such Revolving Credit Borrowing, the
aggregate amount of all Revolving Credit Borrowing utilized for such
purchase since the Effective Date shall not exceed $25,000,000;
and (c) the Administrative Agent shall have received such other
approvals, opinions or documents as are otherwise required to be delivered under
this Agreement and any Appropriate Lender Party through the Administrative Agent
may reasonably request.
74
74
SECTION 3.03. Determinations Under Section 3.01. For purposes of
determining compliance with the conditions specified in Section 3.01, each
Lender Party shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lender Parties unless an
officer of the Joint Lead Arranger responsible for the transactions contemplated
by the Loan Documents shall have received notice from such Lender Party prior to
the Initial Extension of Credit specifying its objection thereto and, if the
Initial Extension of Credit consists of a Borrowing, such Lender Party shall not
have made available to the Administrative Agent such Lender Party's ratable
portion of such Borrowing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower. The
Borrower represents and warrants as follows:
(a) Each Loan Party and each of its Subsidiaries (i) is a
corporation duly organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation, (ii) is duly
qualified and in good standing as a foreign corporation in each other
jurisdiction in which it owns or leases property or in which the
conduct of its business requires it to so qualify or be licensed except
where the failure to so qualify or be licensed would not be reasonably
likely to have a Material Adverse Effect and (iii) has all requisite
corporate power and authority (including, without limitation, all
governmental licenses, permits and other approvals) to own or lease and
operate its properties and to carry on its business as now conducted
and as proposed to be conducted. All of the outstanding Equity
Interests in the Borrower have been validly issued, and, as of the
Effective Date, are fully paid and non-assessable are owned by the
Equity Investors and the other Persons identified on Schedule 4.01(a)
in the amounts specified on Schedule 4.01(a) hereto free and clear of
all Liens.
(b) Set forth on Schedule 4.01(b) hereto is a complete and
accurate list of all direct and indirect Subsidiaries of each Loan
Party as of the date hereof, showing (as to each such Subsidiary) the
jurisdiction of its incorporation, the number of shares of each class
of its Equity Interests authorized, and the number outstanding, on the
date hereof and the percentage of each such class of its Equity
Interests owned (directly or indirectly) by such Loan Party (or
Subsidiary of such Loan Party, as applicable) and the number of shares
covered by all outstanding options, warrants, rights of conversion or
purchase and similar rights at the date hereof. All of the outstanding
Equity Interests in each Loan Party's Subsidiaries have been validly
issued, are fully paid and non-assessable and are
75
75
owned by such Loan Party or one or more of its Subsidiaries free and
clear of all Liens, except those created under the Collateral
Documents.
(c) The execution, delivery and performance by each Loan Party
of each Transaction Document to which it is or is to be a party, and
the consummation of the Transaction, are within such Loan Party's
corporate powers, have been duly authorized by all necessary corporate
action, and do not (i) contravene such Loan Party's charter or bylaws,
(ii) violate any law, rule, regulation (including, without limitation,
Regulation X of the Board of Governors of the Federal Reserve System),
order, writ, judgment, injunction, decree, determination or award,
(iii) except as set forth on Schedule 4.01(c), conflict with or result
in the breach of, or constitute a default or, other than the Offer to
Purchase, require any payment to be made under, any material contract,
loan agreement, indenture, mortgage, deed of trust, lease or other
instrument binding on or affecting any Loan Party, any of its
Subsidiaries or any of their properties or (iv) except for the Liens
created under the Loan Documents, result in or require the creation or
imposition of any Lien upon or with respect to any of the properties of
any Loan Party or any of its Subsidiaries. No Loan Party or any of its
Subsidiaries is in violation of any such law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award or in breach
of any such contract, loan agreement, indenture, mortgage, deed of
trust, lease or other instrument, the violation or breach of which
would be reasonably likely to have a Material Adverse Effect.
(d) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required for (i) the due execution,
delivery, recordation, filing or performance by any Loan Party of any
Transaction Document to which it is or is to be a party, or for the
consummation of the Transaction, (ii) the grant by any Loan Party of
the Liens granted by it pursuant to the Collateral Documents, (iii) the
perfection or maintenance of the Liens created under the Collateral
Documents (including the first priority nature thereof) or (iv) the
exercise by any Agent or any Lender Party of its rights under the Loan
Documents or the remedies in respect of the Collateral pursuant to the
Collateral Documents, except for (A) the filing of the financing
statements and the Intellectual Property Security Agreement delivered
to the Administrative Agent pursuant to Section 3.01(a)(ii) in the
applicable filing offices, (B) the authorizations, approvals, actions,
notices and filings listed on Schedule 4.01(d) hereto, all of which
have been duly obtained, taken, given or made and are in full force and
(C) those authorizations or approvals or other actions by, or notices
to or filings with, any governmental authority or regulatory body or
any third party which are specifically described in Section 5.01(q)
which have not been provided, taken or made on or prior to the
Post-Closing Perfection Date. All applicable waiting periods in
connection with the Transaction have expired without any action having
been taken by any competent authority restraining, preventing or
imposing materially adverse conditions upon the
76
76
Transaction or the rights of the Loan Parties or their Subsidiaries
freely to transfer or otherwise dispose of, or to create any Lien on,
any properties now owned or hereafter acquired by any of them. The
Acquisition has been consummated in accordance with the Acquisition
Agreement and applicable law.
(e) This Agreement has been, and each other Transaction
Document when delivered hereunder will have been, duly executed and
delivered by each Loan Party party thereto. This Agreement is, and each
other Transaction Document when delivered hereunder will be (assuming
this Agreement has been duly authorized, executed and delivered by the
Lenders), the legal, valid and binding obligation of each Loan Party
party thereto, enforceable against such Loan Party in accordance with
its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer
or similar laws affecting the enforcement of creditors' rights
generally and by general equitable principles (whether enforcement is
sought by proceedings in equity or at law).
(f) Except as set forth on Schedule 4.01, there is no action,
suit, investigation, litigation or proceeding affecting any Loan Party
or any of its Subsidiaries, including any Environmental Action, pending
or, to any Loan Party's knowledge, threatened before any court,
governmental agency or arbitrator that (i) would be reasonably likely
to have a Material Adverse Effect or (ii) purports to affect the
legality, validity or enforceability of any Transaction Document or the
consummation of the Transaction, and there has been no change in the
status, or financial effect on any Loan Party or any of its
Subsidiaries, of the Disclosed Litigation from that described on
Schedule 4.01(f) hereto except for such changes as would not reasonably
be expected, either individually or in the aggregate, to have a
Material Adverse Effect.
(g) The audited Consolidated balance sheets of the Borrower
and its Subsidiaries as at December 31, 1998, and the related audited
Consolidated statements of income and Consolidated statement of cash
flows of the Borrower and its Subsidiaries for the fiscal year then
ended, accompanied by an unqualified opinion of Ernst & Young LLP,
independent public accountants, and the unaudited Consolidated balance
sheets of the Borrower and its Subsidiaries as at September 30, 1999,
and the related unaudited Consolidated statements of income and
Consolidated statement of cash flows of the Borrower and its
Subsidiaries for the nine months then ended, duly certified by the
Chief Financial Officer of the Borrower, copies of which have been
furnished to each Lender Party, fairly present, subject, in the case of
said balance sheet as at September 30, 1999, and said statements of
income and cash flows for the nine months then ended, to year-end audit
adjustments, the Consolidated financial condition of the Borrower and
its Subsidiaries as at such dates and the Consolidated results of
operations of the Borrower and its Subsidiaries for the periods ended
on such dates, all in accordance with generally
77
77
accepted accounting principles applied on a consistent basis, and since
December 31, 1998, there has been no Material Adverse Change.
(h) The Consolidated pro forma balance sheets of the Borrower
and its Subsidiaries as at September 30, 1999, certified by the Chief
Financial Officer of the Borrower, copies of which have been furnished
to each Lender Party, fairly present the Consolidated pro forma
financial condition of the Borrower and its Subsidiaries as at such
date giving effect to the Acquisition and the Initial Extension of
Credit hereunder. The financial statements on which such pro forma
financial statements were based and the adjustments made thereto are in
accordance with GAAP.
(i) The Consolidated forecasted balance sheets, statements of
income and statements of cash flows of the Borrower and its
Subsidiaries delivered to the Lender Parties pursuant to Section
3.01(a)(xi) or 5.03 were prepared in good faith on the basis of the
assumptions stated therein, which assumptions were fair in light of the
conditions existing at the time of delivery of such forecasts, and
represented, at the time of delivery, the Borrower's best estimate of
its future financial performance.
(j) Neither the Information Memorandum nor any other
information, exhibit or report prepared by or on behalf of any Loan
Party and furnished to any Agent or any Lender Party in connection with
the negotiation and syndication of the Loan Documents or pursuant to
the terms of the Loan Documents contained, as of the date such
Information Memorandum, exhibit or report was prepared or furnished,
any untrue statement of a material fact or omitted to state a material
fact necessary to make the statements made therein not misleading. The
projections and pro forma financial information contained in the
materials referenced above are based upon good faith estimates and
assumptions believed by management of the Borrower to be reasonable at
the time made, it being recognized by the Lenders that such financial
information as it relates to future events is not to be viewed as fact
and that actual results during the period or periods covered by such
financial information may differ from the projected results set forth
therein by a material amount.
(k) The Borrower is not engaged in the business of extending
credit for the purpose of purchasing or carrying Margin Stock, and no
proceeds of any Advance or drawings under any Letter of Credit will be
used to purchase or carry any Margin Stock or to extend credit to
others for the purpose of purchasing or carrying any Margin Stock.
(l) Neither any Loan Party nor any of its Subsidiaries is an
"investment company", or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company", as such terms are
defined in the Investment Company Act of 1940, as amended. Neither any
Loan Party nor any of its Subsidiaries is a "holding
78
78
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", as such terms are defined in the Public Utility
Holding Company Act of 1935, as amended. Neither the making of any
Advances, nor the issuance of any Letters of Credit, nor the
application of the proceeds or repayment thereof by the Borrower, nor
the consummation of the other transactions contemplated by the
Transaction Documents, will violate any provision of any such Act or
any rule, regulation or order of the Securities and Exchange Commission
thereunder.
(m) Neither any Loan Party nor any of its Subsidiaries is a
party to any indenture, loan or credit agreement or any lease or other
agreement or instrument or subject to any charter or corporate
restriction that would be reasonably likely to have a Material Adverse
Effect.
(n) Except for the filings and the other necessary actions(i)
specified in Section 5.01(q) to occur on or prior to the Post-Closing
Perfection Date, (ii) required in connection with perfecting the Lien
of the Security Agreement in (A) any Intellectual Property which is
registered in any jurisdiction outside the United States of America,
(B) Off-site Goods or (C) any motor vehicles, (iii) to file the
financing statements and the Intellectual Property Security Agreement
delivered to the Administrative Agent pursuant to Section 3.01(a)(ii)
in the applicable filing officers, or (iv) related to perfecting the
Lien of the Collateral Documents in Collateral described in Section
5.01(j)(iv)(B), from and after the Closing Date all filings and other
actions necessary or desirable to perfect and protect the security
interest in the Collateral created under the Collateral Documents will
have been duly made or taken and be in full force and effect, and from
and after such date the Collateral Documents will create in favor of
the Administrative Agent for the benefit of the Secured Parties a valid
and, together with such filings and other actions, perfected first
priority security interest in the Collateral subject only to the prior
Liens and security interests permitted hereunder and under the other
Loan Documents, securing the payment of the Secured Obligations. The
Loan Parties are the legal and beneficial owners of the Collateral free
and clear of any Lien, except for the liens and security interests
created or permitted under the Loan Documents.
(o) Each Loan Party is, individually and together with its
Subsidiaries, Solvent.
(p) (i) Set forth on Schedule 4.01(p) hereto is a complete and
accurate list of all Plans, Multiemployer Plans and Welfare Plans of
the Borrower as of the date hereof.
79
79
(ii) No ERISA Event has occurred or is reasonably expected to
occur with respect to any Plan that has resulted in or is reasonably
expected to result in a Material Adverse Effect.
(iii) Schedule B (Actuarial Information) to the most recent
annual report (Form 5500 Series) for each Plan, copies of which have
been filed with the Internal Revenue Service and furnished to the
Lender Parties, is complete and accurate and fairly presents the
funding status of such Plan, and since the date of such Schedule B
there has been no material adverse change in such funding status.
(iv) Neither any Loan Party nor any ERISA Affiliate has
incurred or is reasonably expected to incur any Withdrawal Liability to
any Multiemployer Plan that could have a Material Adverse Effect.
(v) Neither any Loan Party nor any ERISA Affiliate has been
notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or has been terminated, within the meaning of
Title IV of ERISA, and no such Multiemployer Plan is reasonably
expected to be in reorganization or to be terminated, within the
meaning of Title IV of ERISA in either case, that has resulted, or is
reasonably likely to result in a Material Adverse Effect.
(vi) With respect to each scheme or arrangement mandated by a
government other than the United States (a "FOREIGN GOVERNMENT SCHEME
OR ARRANGEMENT") and with respect to each employee benefit plan
maintained or contributed to by any Loan Party or any Subsidiary of any
Loan Party that is not subject to United States law (a "FOREIGN PLAN"),
except for instances where the failure do so would not be reasonably
likely to result in a Material Adverse Effect, either individually or
in the aggregate:
(A) Any employer and employee contributions required
by law or by the terms of any Foreign Government Scheme or
Arrangement or any Foreign Plan have been made, or, if
applicable, accrued, in accordance with normal accounting
practices.
(B) The fair market value of the assets of each
funded Foreign Plan, the liability of each insurer for any
Foreign Plan funded through insurance or the book reserve
established for any Foreign Plan, together with any accrued
contributions, is sufficient to procure or provide for the
accrued benefit obligations, as of the date hereof, with
respect to all current and former participants in such Foreign
Plan according to the actuarial assumptions and valuations
most recently used to account for such obligations in
accordance with applicable generally accepted accounting
principles.
80
80
(C) Each Foreign Plan required to be registered has
been registered and has been maintained in good standing with
applicable regulatory authorities.
(q) Except as set forth in Schedule 4.01(q) or as would not,
individually or in the aggregate, be reasonably likely to have a
Material Adverse Effect:
(i) the operations and properties of each Loan Party and each
of its Subsidiaries comply in all respects with all applicable
Environmental Laws and Environmental Permits, all past non-compliance
with such Environmental Laws and Environmental Permits has been
resolved, and, to the knowledge of Borrower, no circumstances exist
that would be reasonably likely to (A) form the basis of an
Environmental Action against any Loan Party or any of its Subsidiaries
or any of their properties or (B) cause any such property to be subject
to any restrictions on ownership, occupancy, use or transferability
under any Environmental Law.
(ii) None of the properties currently or, to the knowledge of
the Borrower, formerly owned or operated by any Loan Party or any of
its Subsidiaries is listed or, to the knowledge of Borrower, proposed
for listing, on the NPL or on the CERCLIS or any analogous foreign,
state or local list or, to the knowledge of Borrower, is adjacent to
any such property; there is no asbestos or asbestos-containing material
requiring abatement or any other action under applicable Environmental
Law on any property currently owned or operated by any Loan Party or
any of its Subsidiaries; and Hazardous Materials have not been
released, discharged or disposed of on any property currently or, to
the knowledge of the Borrower, formerly owned or operated by any Loan
Party or any of its Subsidiaries.
(iii) Neither any Loan Party nor any of its Subsidiaries is
undertaking either individually or together with other potentially
responsible parties, any investigation or assessment or remedial or
response action relating to any actual or threatened release, discharge
or disposal of Hazardous Materials at any site, location or operation,
either voluntarily or pursuant to the order of any governmental or
regulatory authority or the requirements of any Environmental Law; and,
to the knowledge of Borrower, all Hazardous Materials generated, used,
treated, handled or stored at, or transported to or from, any property
currently or formerly owned or operated by any Loan Party or any of its
Subsidiaries have been disposed of in a manner not reasonably expected
to result in material liability to any Loan Party or any of its
Subsidiaries.
(r) (i) Neither any Loan Party nor any of its Subsidiaries is
party to any tax sharing agreement, except for tax sharing agreements
among only the Borrower and its Subsidiaries, or only among
Subsidiaries of the Borrower.
81
81
(ii) The Borrower and each of its Subsidiaries has filed, has caused
to be filed or has been included in all Federal and all material state,
local and foreign tax returns required to be filed and has paid all taxes
shown thereon to be due, together with applicable interest and penalties.
(iii) Set forth on Schedule 4.01(r) hereto is a complete and
accurate list, as of the date hereof, of each taxable year of the Borrower
and each of its Subsidiaries and Affiliates for which Federal income tax
returns have been filed and for which the expiration of the applicable
statute of limitations for assessment or collection of Federal income
taxes has not occurred by reason of extension or otherwise (an "OPEN
YEAR").
(iv) The aggregate unpaid amount, as of the date hereof, of
adjustments to the Federal income tax liability of the Borrower and its
Subsidiaries proposed by the Internal Revenue Service with respect to Open
Years does not exceed $5,000,000. No claims have been asserted by the
Internal Revenue Service in respect of Open Years that, in the aggregate,
would be reasonably likely to have a Material Adverse Effect.
(v) The aggregate unpaid amount, as of the date hereof, of
adjustments to the state, local and foreign tax liability of the Borrower
and its Subsidiaries proposed by all state, local and foreign taxing
authorities (other than amounts arising from adjustments to Federal income
tax returns) does not exceed $5,000,000. No claims have been asserted by
such taxing authorities that, in the aggregate, would be reasonably likely
to have a Material Adverse Effect.
(vi) The Acquisition will not be taxable to the Borrower or any of
its Subsidiaries.
(s) Neither the business nor the properties of any Loan Party or any
of its Subsidiaries have been and continue to be affected by any fire,
explosion, accident, strike, lockout or other labor dispute, drought,
storm, hail, earthquake, embargo, act of God or of the public enemy or
other casualty (whether or not covered by insurance) that would be
reasonably likely to have a Material Adverse Effect.
(t) Set forth on Schedule 4.01(t) hereto is a complete and accurate
list of all Existing Debt (other than Surviving Debt) as of the date
hereof , showing the obligor and the principal amount outstanding
thereunder.
(u) Set forth on Schedule 4.01(u) hereto is a complete and accurate
list of all Surviving Debt as of the date hereof, showing the obligor and
the principal amount outstanding thereunder, the maturity date thereof and
the amortization schedule therefor. The Obligations of each Loan Party
under the Loan Documents constitute Senior
82
82
Indebtedness as such term is used and defined in the Indenture and in each
note set forth on Schedule 4.01(u).
(v) Set forth on Schedule 4.01(v) hereto is a complete and accurate
list of all Liens on the property or assets of any Loan Party or any of
its Subsidiaries as of the date hereof, showing the lienholder thereof,
the principal amount of the obligations secured thereby and the property
or assets of such Loan Party or such Subsidiary subject thereto.
(w) Set forth on Schedule 4.01(w) hereto is a complete and accurate
list of all real property owned by any Loan Party or any of its
Subsidiaries as of the date hereof, showing the street address, county or
other relevant jurisdiction, state, record owner and book and estimated
fair value thereof. Each Loan Party or such Subsidiary has good,
marketable and insurable fee simple title to such real property, free and
clear of all Liens, other than Liens created or permitted by the Loan
Documents.
(x) Set forth on Schedule 4.01(x) hereto is a complete and accurate
list of all leases of real property under which any Loan Party or any of
its Subsidiaries is the lessee as of the date hereof, showing the street
address, county or other relevant jurisdiction, state, lessor, lessee,
expiration date and annual rental cost thereof. Each such lease is the
legal, valid and binding obligation of the lessor thereof, enforceable in
accordance with its terms.
(y) Set forth on Schedule 4.01(y) hereto is a complete and accurate
list of all Investments held by any Loan Party or any of its Subsidiaries
on the date hereof, showing as of the date hereof the amount, obligor or
issuer and maturity, if any, thereof.
(z) Set forth on Schedule 4.01(z) hereto is a complete and accurate
list of all registered patents, trademarks, trade names, service marks and
copyrights, and all applications therefor and licenses thereof, of each
Loan Party or any of its Subsidiaries on the date hereof, showing as of
the date hereof the jurisdiction in which registered, the registration
number, the date of registration and the expiration date.
(aa) Set forth on Schedule 4.01(aa) hereto is a complete and
accurate list of all Material Contracts of each Loan Party and its
Subsidiaries as of the date hereof, showing the parties, subject matter
and term thereof. As of the date hereof, each such Material Contract has
been duly authorized, executed and delivered by all parties thereto is in
full force and effect and is binding upon and enforceable against all
parties thereto in accordance with its terms, and there exists no default
under any Material Contract by any party thereto.
83
83
(bb) The Borrower has (i) initiated a review and assessment of all
areas within its and each of its Subsidiaries' business and operations
(including those affected by suppliers, vendors and customers) that could
be adversely affected by the risk that computer applications used by the
Borrower or any of its Subsidiaries (or suppliers, vendors and customers)
may be unable to recognize and perform properly date-sensitive functions
involving certain dates prior to and any date after December 31, 1999 (the
"YEAR 2000 PROBLEM"), (ii) developed a plan and timetable for addressing
the Year 2000 Problem on a timely basis and (iii) to date, implemented
that plan in accordance with such timetable. Based on the foregoing, the
Borrower believes that all computer applications that are material to its
or any of its Subsidiaries' business and operations are reasonably
expected on a timely basis to be able to perform properly date-sensitive
functions for all dates before and after January 1, 2000 ("YEAR 2000
COMPLIANT"), except to the extent that a failure to do so could not
reasonably be expected to have a Material Adverse Effect.
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants. So long as any Advance or any
other Obligation of any Loan Party under any Loan Document shall remain unpaid,
any Letter of Credit shall be outstanding or any Lender Party shall have any
Commitment hereunder, the Borrower will:
(a) Compliance with Laws, Etc. Comply, and cause each of its
Subsidiaries to comply, in all material respects, with all applicable
laws, rules, regulations and orders, such compliance to include, without
limitation, compliance with ERISA and the Racketeer Influenced and Corrupt
Organizations Chapter of the Organized Crime Control Act of 1970, unless
any such non-compliance would not reasonably be expected to have a
Material Adverse Effect.
(b) Payment of Taxes, Etc. Pay and discharge, and cause each of its
Subsidiaries to pay and discharge, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges or levies
imposed upon it or upon its property and (ii) all lawful claims that, if
unpaid, might by law become a Lien upon its property; provided, however,
that neither the Borrower nor any of its Subsidiaries shall be required to
pay or discharge any such tax, assessment, charge or claim that is being
contested in good faith and by proper proceedings and as to which
appropriate reserves are being maintained, unless and until any Lien
resulting therefrom attaches to its property and becomes enforceable
against its other creditors.
84
84
(c) Compliance with Environmental Laws. Comply, and cause each of
its Subsidiaries to comply, and use commercially reasonable efforts to
cause all lessees and other Persons operating or occupying its properties
to comply, in all material respects, with all applicable Environmental
Laws and Environmental Permits; obtain and renew and cause each of its
Subsidiaries to obtain and renew all material Environmental Permits
necessary for its operations and properties; and conduct, and cause each
of its Subsidiaries to conduct, any investigation, study, sampling and
testing (collectively referred to as "INVESTIGATION"), and undertake any
cleanup, removal, remedial or other action necessary to remove and clean
up all Hazardous Materials (collectively referred to as "REMEDIAL ACTION")
from any of its properties, to the extent required by Environmental Laws
unless the failure to conduct such Investigation or undertake such
Remedial Action would not, individually or in the aggregate, be reasonably
likely to have a Material Adverse Effect ; provided, however, that neither
the Borrower nor any of its Subsidiaries shall be required to undertake
any such Remedial Action to the extent that its obligation to do so is
being contested in good faith and by proper proceedings and appropriate
reserves are being maintained with respect to such circumstances.
(d) Maintenance of Insurance. Maintain, and cause each of its
Subsidiaries to maintain, insurance with responsible and reputable
insurance companies or associations in such amounts and covering such
risks as is usually carried by companies engaged in similar businesses and
owning similar properties in the same general areas in which the Borrower
or such Subsidiary operates.
(e) Preservation of Corporate Existence, Etc. Preserve and maintain,
and cause each of its Subsidiaries to preserve and maintain, its
existence, legal structure, legal name, rights (charter and statutory),
permits, licenses, approvals, privileges and franchises, except to the
extent any failure to preserve and maintain any of the foregoing could not
reasonably be expected to have a Material Adverse Effect; provided,
however, that the Borrower and its Subsidiaries may consummate any merger
or consolidation permitted under Section 5.02(d); and provided, further,
that neither the Borrower nor any of its Subsidiaries shall be required to
preserve any right, permit, license, approval, privilege or franchise if
the Board of Directors of the Borrower or such Subsidiary shall determine
that the preservation thereof is no longer desirable in the conduct of the
business of the Borrower or such Subsidiary, as the case may be, and that
the loss thereof is not disadvantageous in any material respect to the
Borrower, such Subsidiary or the Lender Parties.
(f) Visitation Rights. At any reasonable time and from time to time
upon reasonable notice, permit the Administrative Agent or any of the
Lender Parties, or any agents or representatives thereof, to examine and
make copies of and abstracts from the records and books of account of, and
visit the properties of, the Borrower and any of its
85
85
Subsidiaries, and to discuss the affairs, finances and accounts of the
Borrower and any of its Subsidiaries with any of their officers or
directors and with their independent certified public accountants.
(g) Keeping of Books. Keep, and cause each of its Subsidiaries to
keep, proper books of record and account, in which full and correct
entries shall be made of all financial transactions and the assets and
business of the Borrower and each such Subsidiary in accordance with
generally accepted accounting principles in effect from time to time.
(h) Maintenance of Properties, Etc. Maintain and preserve, and cause
each of its Subsidiaries to maintain and preserve, all of its properties
that are used or useful in the conduct of its business in good working
order and condition, ordinary wear and tear excepted.
(i) Transactions with Affiliates. Conduct, and cause each of its
Subsidiaries to conduct, all transactions otherwise permitted under the
Loan Documents with any of their Affiliates on terms that are fair and
reasonable and no less favorable to the Borrower or such Subsidiary than
it would obtain in a comparable arm's-length transaction with a Person not
an Affiliate. The following transactions shall in any event be deemed to
comply with this Section 5.01(i): (i) the Borrower's execution and
delivery of the Management Agreement and the payment of management fees to
the Sponsor in an aggregate amount of up to $1.6 million per year pursuant
to the Management Agreement, (ii) reimbursements of Sponsor for reasonable
out-of-pocket expenses incurred by it in connection with performing
management services for the Borrower and payments to Sponsor in respect of
indemnification obligations under the Management Agreement; (iii) any
transaction between the Borrower or any Subsidiary and an officer or
member of the board of directors of, the Borrower or any Subsidiary in the
ordinary course involving compensation, indemnity or employee benefit
arrangements; (iv) the Transactions and (v) the Borrower's execution,
delivery and performance of the Shareholder Agreements and a registration
rights agreement with SSCI Investors containing customary terms and
provisions for such agreements.
(j) Covenant to Guarantee Obligations and Give Security. Upon (x)
the request of the Administrative Agent following the occurrence and
during the continuance of a Default, (y) the formation or acquisition of
any new direct or indirect Domestic Subsidiaries by any Loan Party or (z)
the acquisition of any property by any Loan Party, and such property, in
the judgment of the Collateral Agent, shall not already be subject to a
perfected first priority security interest in favor of the Administrative
Agent for the benefit of the Secured Parties, then the Borrower shall, in
each case at the Borrower's expense:
86
86
(i) in connection with the formation or acquisition of a
Domestic Subsidiary, within 20 days after such formation or
acquisition, cause each such Subsidiary, and cause each direct and
indirect parent of such Subsidiary (if it has not already done so),
to duly execute and deliver to the Administrative Agent a guaranty
or guaranty supplement, in form and substance satisfactory to the
Administrative Agent, guaranteeing the other Loan Parties'
obligations under the Loan Documents,
(ii) within 20 days after such request, formation or
acquisition, furnish to the Administrative Agent a description of
the real and personal properties of the Loan Parties and their
respective Subsidiaries in detail satisfactory to the Administrative
Agent,
(iii) within 45 days after such request, formation or
acquisition, duly execute and deliver, and cause each such
Subsidiary and each direct and indirect parent of such Subsidiary
(if it has not already done so) to duly execute and deliver, to the
Administrative Agent mortgages, pledges, assignments, security
agreement supplements and other security agreements, similar to the
Mortgage and Security Agreement attached hereto and otherwise in
form and substance satisfactory to the Administrative Agent,
securing payment of all the Obligations of the applicable Loan
Party, such Subsidiary or such parent, as the case may be, under the
Loan Documents and constituting Liens on all such properties,
(iv) within 30 days after such request, formation or
acquisition, take, and cause such Subsidiary or such parent to take,
whatever action (including, without limitation, the filing of
Uniform Commercial Code financing statements, the giving of notices
and the endorsement of notices on title documents) may be necessary
or advisable in the opinion of the Administrative Agent to vest in
the Administrative Agent (or in any representative of the
Administrative Agent designated by it) valid and subsisting Liens on
the properties purported to be subject to the pledges, assignments,
security agreement supplements and security agreements delivered
pursuant to this Section 5.01(j), enforceable against all third
parties in accordance with their terms; provided, however, that the
Borrower and its Subsidiaries shall not be required to comply with
the requirements of this Section 5.01(j)(iv) with respect to (A) any
actions relating to Intellectual Property that would otherwise be
required to be taken outside of the United States, (B) Collateral
for which the Administrative Agent, in its reasonable discretion
determines that the cost of perfecting the lien of the Security
Agreement therein is excessive in relation to the security afforded
thereby or (C) any actions in respect of any Equity Interests in any
Foreign Corporation (as defined in the Security
87
87
Agreement) other than as provided in Sections 1(d)(iv) and 18(8) of
the Security Agreement,
(v) within 60 days after the request of the Administrative
Agent, deliver to the Administrative Agent, a signed copy of a
favorable opinion, addressed to the Administrative Agent and the
other Secured Parties, of counsel for the Loan Parties acceptable to
the Administrative Agent as to the matters contained in clauses (i),
(iii) and (iv) above, as to such guaranties, guaranty supplements,
mortgages, pledges, assignments, security agreement supplements and
security agreements being legal, valid and binding obligations of
each Loan Party party thereto enforceable in accordance with their
terms, as to the matters contained in clause (iv) above, as to such
recordings, filings, notices, endorsements and other actions being
sufficient to create valid perfected Liens on such personal
property, and as to such other matters as the Administrative Agent
may reasonably request,
(vi) as promptly as reasonably practicable and in any case not
later than 60 days after the request of the Administrative Agent in
its sole discretion, deliver to the Administrative Agent with
respect to each parcel of real property owned or held by the entity
that is the subject of such request, formation or acquisition title
reports, surveys and engineering, soils and other reports, and Phase
I environmental assessment reports, each in scope, form and
substance satisfactory to the Administrative Agent, provided,
however, that to the extent that any Loan Party or any of its
Subsidiaries shall have otherwise received any of the foregoing
items with respect to such real property, such items shall, promptly
after the receipt thereof, be delivered to the Administrative Agent,
and take whatsoever action, including the recording of mortgages,
may be necessary or advisable in the opinion of the Administrative
Agent to vest in the Administrative Agent valid and subsisting Liens
on such real estate, enforceable against all third parties in
accordance with their terms,
(vii) upon the occurrence and during the continuance of a
Default, at the request of the Administrative Agent, promptly cause
to be deposited any and all cash dividends paid or payable to it or
any of its Subsidiaries from any of its Subsidiaries from time to
time into the Collateral Account, and with respect to all other
dividends paid or payable to it or any of its Subsidiaries from time
to time, promptly execute and deliver, or cause such Subsidiary to
promptly execute and deliver, as the case may be, any and all
further instruments and take or cause such Subsidiary to take, as
the case may be, all such other action as the Administrative Agent
may deem necessary or desirable in order to obtain and maintain from
and
88
88
after the time such dividend is paid or payable a perfected, first
priority lien on and security interest in such dividends, and
(viii) at any time and from time to time, promptly execute and
deliver any and all further instruments and documents and take all
such other action as the Administrative Agent may reasonably deem
necessary or desirable in obtaining the full benefits of, or in
perfecting and preserving the Liens of, such guaranties, mortgages,
pledges, assignments, security agreement supplements and security
agreements.
(k) Further Assurances. (i) Promptly upon request by any Agent, or
any Lender Party through the Administrative Agent, correct, and cause each
of its Subsidiaries promptly to correct, any material defect or error that
may be discovered in any Loan Document or in the execution,
acknowledgment, filing or recordation thereof, and
(ii) Promptly upon request by any Agent, or any Lender Party through
the Administrative Agent, do, execute, acknowledge, deliver, record,
re-record, file, re-file, register and re-register any and all such
further acts, deeds, conveyances, pledge agreements, mortgages, deeds of
trust, trust deeds, assignments, financing statements and continuations
thereof, termination statements, notices of assignment, transfers,
certificates, assurances and other instruments as any Agent, or any Lender
Party through the Administrative Agent, may reasonably require from time
to time in order to (A) carry out more effectively the purposes of the
Loan Documents, (B) to the fullest extent permitted by applicable law,
subject any Loan Party's or any of its Subsidiaries' properties, assets,
rights or interests to the Liens now or hereafter intended to be covered
by any of the Collateral Documents, (C) perfect and maintain the validity,
effectiveness and priority of any of the Collateral Documents and any of
the Liens intended to be created thereunder and (D) assure, convey, grant,
assign, transfer, preserve, protect and confirm more effectively unto the
Secured Parties the rights granted or now or hereafter intended to be
granted to the Secured Parties under any Loan Document or under any other
instrument executed in connection with any Loan Document to which any Loan
Party or any of its Subsidiaries is or is to be a party, and cause each of
its Subsidiaries to do so.
(l) Performance of Indenture. Perform and observe, and cause each of
its Subsidiaries to perform and observe, all of the terms and provisions
of the Indenture to be performed or observed by it in connection with the
Offer to Purchase and take all reasonable action to such end as may be
from time to time requested by the Administrative Agent.
89
89
(m) Preparation of Environmental Reports. At the reasonable request
of the Required Lenders from time to time upon a violation by any Loan
Party or any of its Subsidiaries of Environmental Law, or the occurrence
or discovery (including, without limitation, from a report delivered
pursuant to Section 5.01(j)(vi)) of any other fact, circumstance, event,
act or condition that could result in the liability of any Loan Party or
any of its Subsidiaries under Environmental Law, that, individually or in
the aggregate, would be reasonably likely to have a Material Adverse
Effect, provide to the Lender Parties within 90 days after such request,
at the expense of the Borrower, an environmental site assessment report
for any of its or its Subsidiaries' properties described in such request,
prepared by an environmental consulting firm reasonably acceptable to the
Required Lenders, indicating the presence or absence of Hazardous
Materials and the estimated cost of any compliance or Remedial Action in
connection with any Hazardous Materials on such properties; without
limiting the generality of the foregoing, if any such report is not be
provided within the time referred to above, the Required Lenders may
retain an environmental consulting firm reasonably acceptable to Borrower
to prepare such report at the expense of the Borrower, and the Borrower
hereby grants and agrees to cause any Subsidiary that owns any property
described in such request to grant at the time of such request to the
Agents, the Lender Parties, such firm and any agents or representatives
thereof an irrevocable non-exclusive license, subject to the rights of
tenants, to enter onto their respective properties to undertake such an
assessment during reasonable business hours (after giving reasonable prior
notice to Borrower).
(n) Compliance with Terms of Leaseholds. Make all payments and
otherwise perform all obligations in respect of each leases of real
property to which the Borrower or any of its Subsidiaries is a party which
provides for annual base lease rent thereunder of $250,000 or more, keep
such leases in full force and effect and not allow such leases to lapse or
be terminated or any rights to renew such leases to be forfeited or
cancelled, notify the Administrative Agent of any default by any party
with respect to such leases and cooperate with the Administrative Agent in
all respects to cure any such default, and cause each of its Subsidiaries
to do so, except, in any case, where the failure to do so, either
individually or in the aggregate, would not be reasonably likely to have a
Material Adverse Effect.
(o) Interest Rate Hedging. After the completion of the Offer to
Purchase and prior to the 6 month anniversary of the Initial Borrowing,
enter into interest rate hedge agreements such that, after giving effect
to such Hedge Agreements, at least 45% of the Borrower's Funded Debt
(including the Senior Subordinated Notes) either by its terms accrues
interest at a fixed rate until maturity or is subject to an interest rate
Hedge Agreement. While the Borrower will have no obligation to exceed such
45% level,
90
90
Borrower agrees to a target level of 50% of its Funded Debt being subject
to interest rate Hedge Agreements.
(p) Performance of Material Contracts. Perform and observe all the
terms and provisions of each Material Contract to be performed or observed
by it, maintain each such Material Contract in full force and effect,
enforce each such Material Contract in accordance with its terms, take all
such action to such end as may be from time to time requested by the
Administrative Agent and, upon request of the Administrative Agent, make
to each other party to each such Material Contract such demands and
requests for information and reports or for action as any Loan Party or
any of its Subsidiaries is entitled to make under such Material Contract,
and cause each of its Subsidiaries to do so, except, in any case, where
the failure to do so, either individually or in the aggregate, would not
be reasonably likely to have a Material Adverse Effect. The Borrower will
use all reasonable efforts, and will cause the applicable Loan Party to
use all reasonable efforts to obtain, on or prior to the Post-Closing
Perfection Date, the written consent of any necessary party to each
Designated Material Contract which by its terms prohibits the applicable
Loan Party party thereto from assigning a security interest in its rights
thereunder pursuant to the Security Agreement, which consent shall permit
the applicable Loan Party to grant such a security interest in such
Designated Material Contract.
(q) Post-Closing Date Deliveries. On or before the date (the
"POST-CLOSING PERFECTION DATE")which is the earliest of (x) 60 days
following the Effective Date, or (y) any other date on which a Borrowing
is requested, if after giving effect to such Borrowing, the Senior
Debt/EBITDA Ratio would be greater than 2.25:1, the Administrative Agent
shall have received the following, each dated on or before such date
(unless otherwise specified), in form and substance satisfactory to the
Joint Lead Arrangers (unless otherwise specified) and in sufficient copies
for each Lender Party:
(i) Deeds of trust, trust deeds and mortgages in form and
substance reasonably satisfactory to the Administrative Agent and
the Joint Lead Arrangers, and covering the properties listed on
Schedules 4.01(w) hereto (together with any Assignments of Leases
and Rents referred to therein and each other mortgage delivered
pursuant to Section 5.01(j), in each case as amended, the
"MORTGAGES"), duly executed by the appropriate Loan Party, together
with:
(A) evidence that counterparts of the Mortgages have
been or will be duly recorded on or before the day of the
Post-Closing Perfection Date in all filing or recording
offices that the Administrative Agent may deem necessary or
desirable in order to create a valid first and subsisting Lien
on the property described therein in favor of the
Administrative
91
91
Agent for the benefit of the Secured Parties and that all
filing and recording taxes and fees have been paid,
(B) fully paid American Land Title Association Lender's
Extended Coverage title insurance policies (the "MORTGAGE
POLICIES") in form and substance, with endorsements and in
amount acceptable to the Administrative Agent and the Joint
Lead Arrangers, issued, coinsured and reinsured by title
insurers acceptable to the Administrative Agent and the Joint
Lead Arrangers, insuring the Mortgages to be valid first and
subsisting Liens on the property described therein, free and
clear of all defects (including, but not limited to,
mechanics' and materialmen's Liens) and encumbrances,
excepting only Permitted Encumbrances (which shall include for
all purposes of this Section 5.01(q), in the case of the
property of Xxxxxx & Xxxxxxx, Corp. located in Seabrook, New
Hampshire, the existing mortgage on that property in favor of
Xxxxxx International, Inc.), and providing for such other
affirmative insurance (including endorsements for future
advances under the Loan Documents and for mechanics' and
materialmen's Liens) and such coinsurance and direct access
reinsurance as the Administrative Agent and the Joint Lead
Arrangers may reasonably deem necessary or desirable,
(C) American Land Title Association form surveys, dated
no more than 30 days before the day of the Initial Extension
of Credit, certified to the Administrative Agent and the
issuer of the Mortgage Policies in a manner satisfactory to
the Administrative Agent and the Joint Lead Arrangers by a
land surveyor duly registered and licensed in the States in
which the property described in such surveys is located and
acceptable to the Administrative Agent and the Joint Lead
Arrangers, showing all buildings and other improvements, any
off-site improvements, the location of any easements, parking
spaces, rights of way, building set-back lines and other
dimensional regulations and the absence of encroachments,
either by such improvements or on to such property, and other
defects, other than encroachments and other defects reasonably
acceptable to the Administrative Agent and the Joint Lead
Arrangers,
(D) any Assignments of Leases and Rents referred to in
the applicable Mortgages, duly executed by the appropriate
Loan Party,
(E) such consents and agreements of lessors and other
third parties, and such estoppel letters and other
confirmations, as the
92
92
Administrative Agent and the Joint Lead Arrangers may
reasonably deem necessary or desirable,
(F) evidence of the insurance required by the terms of
the Mortgages, and
(G) evidence that all other action that the
Administrative Agent and the Joint Lead Arrangers may deem
necessary or desirable in order to create valid first and
subsisting Liens on the property described in the Mortgages
has been taken, subject only to Permitted Encumbrances.
(ii) the Pledged Account Letters referred to in the Security
Agreement, duly executed by each Pledged Account Bank referred to in
the Security Agreement.
(iii) the Control Agreements referred to in the Security
Agreement, duly executed by the applicable securities intermediary
or commodities intermediary with respect to each securities account
or commodities account of each Loan Party, if any.
(iv) favorable opinions addressed to the Agents and the Lender
Parties from counsel to the Loan Parties and local counsel as to
matters contained in the foregoing clauses (i), (ii) and (iii) as
the Joint Lead Arrangers may reasonably request.
(v) certified copies of each Designated Material Contract,
together with the written consents of the other parties thereto
which the Borrower is required to seek as provided pursuant to
Section 5.01(p).
(vi) evidence satisfactory to the Administrative Agent and the
Joint Lead Arrangers that all necessary and customary recordations
and filings have been made in the appropriate recordation or filing
location in the jurisdiction in which any Foreign Subsidiary is
organized in order to perfect the Lien of the Security Agreement in
the Equity Interests of such Foreign Subsidiary which are pledged by
the applicable Loan Party thereunder.
(r) Certain Effective Date Deliveries. (i) Each Lender Party
hereby waives the following conditions to the Initial Extension of
Credit in Section 3.01:
(A) pursuant to Section 3.01(a)(ii)(A), the requirement that
the Administrative Agent shall have received certificates
representing the Initial
93
93
Pledged Shares in Foreign Subsidiaries organized under the laws of
Mexico, together with undated stock powers, duly executed in blank;
and
(B) pursuant to Section 3.01(a)(vi), the requirement that the
Administrative Agent shall have received (x) a good standing
certificate from the Illinois Secretary of State stating that Xxxxxx
& Xxxxxxx Corp. is duly qualified and in good standing as a foreign
corporation in Illinois and (y) a good standing certificate from the
Massachusetts Secretary of the Commonwealth stating that Xxxxxx &
Xxxxxxx Corp. is duly qualified and in good standing as a foreign
corporation in Massachusetts.
(ii) On or prior to the date which is 90 days following the
Effective Date, the Borrower shall deliver to the Administrative Agent
each of the share certificates representing the Pledged Shares and related
stock power described in clause (i)(A) above; provided however that, at
the reasonable request of the Borrower, the Administrative Agent may
extend the period for the delivery of such certificates for an additional
90 days.
(iii) On or prior to the date which is 90 days following the
Effective Date, the Borrower shall deliver to the Administrative Agent the
Massachusetts good standing certificate described in clause (i)(B)(y)
above; provided however that, at the reasonable request of the Borrower,
the Administrative Agent may extend the period for the delivery of such
certificate for an additional 90 days.
(iv) On or prior to the first anniversary of the Effective Date the
Borrower shall deliver to the Administrative Agent the Illinois good
standing certificate described in clause (i)(B)(x) above.
SECTION 5.02. Negative Covenants. So long as any Advance or any
other Obligation of any Loan Party under any Loan Document shall remain unpaid,
any Letter of Credit shall be outstanding or any Lender Party shall have any
Commitment hereunder, the Borrower will not, at any time:
(a) Liens, Etc. Create, incur, assume or suffer to exist, or permit
any of its Subsidiaries to create, incur, assume or suffer to exist, any
Lien on or with respect to any of its properties of any character
(including, without limitation, accounts) whether now owned or hereafter
acquired, or sign or file or suffer to exist, or permit any of its
Subsidiaries to sign or file or suffer to exist, under the Uniform
Commercial Code of any jurisdiction, a financing statement that names the
Borrower or any of its Subsidiaries as debtor, or sign or suffer to exist,
or permit any of its Subsidiaries to sign or suffer to exist, any security
agreement authorizing any secured party thereunder to file such financing
94
94
statement, or assign, or permit any of its Subsidiaries to assign, any
accounts or other right to receive income, except:
(i) Liens created under the Loan Documents;
(ii) Permitted Liens;
(iii) Liens existing on the date hereof and described on
Schedule 4.01(v) hereto;
(iv) purchase money Liens upon or in real property or
equipment acquired or held by the Borrower or any of its
Subsidiaries in the ordinary course of business to secure the
purchase price of such property or equipment or to secure Debt
incurred solely for the purpose of financing the acquisition of any
such property or equipment to be subject to such Liens, or Liens
existing on any such property or equipment at the time of
acquisition (other than any such Liens created in contemplation of
such acquisition that do not secure the purchase price), or
extensions, renewals or replacements of any of the foregoing for the
same or a lesser amount; provided, however, that no such Lien shall
extend to or cover any property other than the property or equipment
being acquired, and no such extension, renewal or replacement shall
extend to or cover any property not theretofore subject to the Lien
being extended, renewed or replaced; and provided, further, that the
aggregate principal amount of the Debt secured by Liens permitted by
this clause (iv) shall not exceed the amount permitted under Section
5.02(b)(ii) at any time outstanding;
(v) Liens arising in connection with Capitalized Leases
permitted under Section 5.02(b)(iii); provided that no such Lien
shall extend to or cover any Collateral or assets other than the
assets subject to such Capitalized Leases;
(vi) Liens on property of a Person existing at the time such
Person is merged into or consolidated with the Borrower or any
Subsidiary of the Borrower or becomes a Subsidiary of the Borrower
after the Effective Date securing Debt permitted by Section
5.02(b)(v); provided that such Liens were not created in
contemplation of such merger, consolidation or investment and do not
extend to any assets other than those of the Person merged into or
consolidated with the Borrower or such Subsidiary or acquired by the
Borrower or such Subsidiary;
(vii) other Liens securing Debt and Contingent Obligations
outstanding in an aggregate principal amount not to exceed
$10,000,000, provided that no such Lien shall extend to or cover any
Collateral;
95
95
(viii) Liens arising solely by virtue of any statutory or
common law provision relating to banker's liens, rights of set-off
or similar rights and remedies as to deposit amounts or other funds
maintained with a credit or depository institution; provided that
(A) such deposit account is not a dedicated cash collateral account
and is not subject to restrictions against access by Borrower or any
Subsidiary in excess of those set forth by regulations promulgated
by the Federal Reserve Board, and (B) such deposit account is not
intended by Borrower or any Subsidiary to provide collateral to the
depository institution;
(ix) Liens evidenced by UCC financing statements regarding
operating leases permitted by this Agreement or in respect of
consigned goods;
(x) Liens consisting of judgment or judicial attachment liens
(including prejudgment attachment); provided that the enforcement of
such Liens is effectively stayed or payment of which is covered in
full (subject to customary deductibles) by insurance or which do not
otherwise result in an Event of Default;
(xi) Liens securing debt of Foreign and non-wholly owned
Subsidiaries to the extent such Debt is permitted pursuant to
Section 5.02(b);
(xii) Liens on documents of title and the property covered
thereby securing Debt in respect of letters of credit which are
commercial letters of credit;
(xiii) Liens solely in favor of the Borrower or a Subsidiary
of the Borrower; provided that such Liens shall have been assigned
as collateral under the Security Agreement;
(xiv) any encumbrances or restriction (including any put and
call arrangements) with respect to the Equity Interests of any joint
venture agreement to which the Borrower or any of its Subsidiaries
is a party; and
(xv) the replacement, extension or renewal of any Lien
permitted by clause (iii) above upon or in the same property
theretofore subject thereto or the replacement, extension or renewal
(without increase in the amount or change in any direct or
contingent obligor) of the Debt secured thereby.
(b) Debt. Create, incur, assume or suffer to exist, or permit any of
its Subsidiaries to create, incur, assume or suffer to exist, any Debt,
except:
(i) Debt under the Loan Documents,
96
96
(ii) (x) Capitalized Leases and Debt secured by Liens
permitted by Section 5.02(a)(iv) and 5.02(a)(vi) not to exceed in
the aggregate $15,000,000 at any time outstanding,
(iii) the Surviving Debt,
(iv) unsecured Debt of the Borrower and its Subsidiaries
incurred in the ordinary course of business for the deferred
purchase price of property or services and aggregating, on a
Consolidated basis, not more than $20,000,000 at any one time
outstanding,
(v) Debt of any Person that becomes a Subsidiary of the
Borrower after the date hereof in accordance with the terms of
Section 5.02(f) which Debt is existing at the time such Person
becomes a Subsidiary of the Borrower (other than Debt incurred
solely in contemplation of such Person becoming a Subsidiary of the
Borrower),
(vi) Debt in respect of Hedge Agreements designed to hedge
against fluctuations in interest rates or foreign exchange rates
incurred in the ordinary course of business and consistent with
prudent business practice with the aggregate Agreement Value thereof
not to exceed $5,000,000 at any time outstanding,
(vii) Debt owed to the Borrower by a Subsidiary of the
Borrower and Debt owed by the Borrower to a wholly owned Subsidiary
of the Borrower, which Debt (x) shall constitute Pledged Debt, and
(y) shall be evidenced by promissory notes in substantially the form
attached as Exhibit I or such other form satisfactory to the
Administrative Agent;
(viii) Debt arising from honoring a check, draft or similar
instrument against insufficient funds; provided that such Debt is
extinguished within five Business days of its incurrence;
(ix) unsecured Debt incurred by Borrower to former employees
in connection with the purchase or redemption of stock of Borrower
not to exceed in the aggregate $2,000,000;
(x) one additional issue of Subordinated Debt in addition to
any refinancing of the Senior Subordinated Notes pursuant to clause
(xi) of this Section 5.02(b); provided that (A) such single issue of
additional Subordinated
97
97
Debt (1) has a stated maturity occurring at least 90 days after the
final maturity of the Term B Facility and (2) is issued pursuant to
an indenture or other documentation containing terms and conditions
no less favorable to the Lender Parties than the terms set forth in
the Senior Subordinated Note Indenture; and (B) after giving effect
to the issuance of such Debt (1) no Default shall have occurred and
be continuing and (2) Borrower shall be in pro forma compliance with
the covenants contained in Section 5.04; and
(xi) any renewals, extensions, substitutions, refinancings or
replacements (each a "refinancing") of any Debt permitted by this
Section 5.02(b), including any successive refinancings, so long as
any such refinancing Debt shall (A) not be on financial or other
terms, in the reasonable judgment of Borrower, that are more onerous
that the Debt being refinanced, (B) not have a stated maturity or
average life that is shorter than the Debt being refinanced, (C) be
at least as subordinate to the Obligations under the Loan Documents
as the Debt being refinanced (and unsecured if the refinanced Debt
is unsecured) and (D) be in a principal amount that does not exceed
the principal amount so refinanced, plus the lesser of (1) the
stated amount of any premium or other payment required to be paid in
connection with such refinancing pursuant to the terms of the Debt
being refinanced and (2) the amount of premium or other payment
actually paid at such time to refinance the Debt, plus, in either
case, the amount of reasonable expenses of Borrower or any
Subsidiary incurred in connection with such refinancing.
(c) Contingent Obligations. Create, incur, assume or suffer to
exist, or permit any of its Subsidiaries to create, incur or suffer to
exist any Contingent Obligations, except Contingent Obligations not to
exceed $15,000,000 at any time outstanding.
(d) Change in Nature of Business. Make, or permit any of its
Subsidiaries to make, any material change in the nature of its business as
carried on at the date hereof.
(e) Mergers, Etc. Merge into or consolidate with any Person or
permit any Person to merge into it, or permit any of its Subsidiaries to
do so, except that:
(i) any Subsidiary of the Borrower may merge into or
consolidate with any other Subsidiary of the Borrower, provided
that, in the case of any such merger or consolidation, the Person
formed by such merger or consolidation shall be a wholly owned
Domestic Subsidiary of the Borrower, provided, further that, in the
case of any such merger or consolidation to which a Subsidiary
Guarantor is a party, the Person formed by such merger or
consolidation shall be a Subsidiary Guarantor;
98
98
(ii) in connection with any Permitted Acquisition under
Section 5.02(g)(vii), any Subsidiary of the Borrower may merge into
or consolidate with any other Person or permit any other Person to
merge into or consolidate with it; provided that the Person
surviving such merger shall be a wholly owned Subsidiary of the
Borrower; and
(iii) in connection with any sale or other disposition
permitted under Section 5.02(f) (other than clause (ii) thereof),
any Subsidiary of the Borrower may merge into or consolidate with
any other Person or permit any other Person to merge into or
consolidate with it;
provided, however, that in each case, immediately after giving effect
thereto, no event shall occur and be continuing that constitutes a
Default.
(f) Sales, Etc., of Assets. Sell, lease, transfer or otherwise
dispose of, or permit any of its Subsidiaries to sell, lease, transfer or
otherwise dispose of, any assets, or grant any option or other right to
purchase, lease or otherwise acquire any assets other than Inventory to be
sold in the ordinary course of its business, except:
(i) sales of Inventory in the ordinary course of its
business;
(ii) in a transaction authorized by Section 5.02(e) (other
than subsection (iii) thereof);
(iii) the sale of equipment to the extent that such equipment
is exchanged for credit against the purchase price of similar
replacement equipment, or the proceeds of such sale are reasonably
promptly applied to the purchase price of similar replacement
equipment;
(iv) the limited recourse sale of Receivables in connection
with the securitization thereof, which sale is non-recourse to the
extent customary in securitizations and consistent with past
practice;
(v) in the ordinary course of business, the license of
patents, trademarks, copyrights and know-how to third Persons, so
long as each such license is subject to the Lien of the Security
Agreement and does not otherwise prohibit the granting of a Lien
therein by Borrower or any Subsidiary pursuant to the Security
Agreement;
99
99
(vi) the sale of worn out or obsolete equipment not utilized
in the business of Borrower or any Subsidiary;
(vii) the abandonment or other disposition for no
consideration of patents, trademarks or other intellectual property
that is, in the reasonable judgment of Borrower, no longer
economically practicable to maintain or useful in the conduct of the
business of Borrower and its Subsidiaries taken as a whole;
(viii) the sale of any asset by the Borrower or any Subsidiary
(other than a bulk sale of Inventory and a sale of Receivables other
than delinquent accounts for collection purposes only) so long as
(A) the purchase price paid to the Borrower or such Subsidiary for
such asset shall be no less than the fair market value of such asset
at the time of such sale; (B) the purchase price for such asset
shall be paid to the Borrower or such Subsidiary solely in cash; (C)
the aggregate purchase price paid to the Borrower and all of its
Subsidiaries for such asset and all other assets sold by the
Borrower and its Subsidiaries during the same Fiscal Year pursuant
to this clause (viii) shall not exceed $25,000,000 ; provided,
however, that the Borrower and it Subsidiaries may sell Equity
Interests in, or the properties and assets of, any Person, for an
aggregate amount in any Fiscal Year of the Borrower which is greater
than $25,000,000 on the condition that the Borrower shall have
delivered to the Administrative Agent not later than five days prior
to such sale a report prepared in good faith and certified by the
Chief Financial Officer of the Borrower and approved by the Joint
Lead Arrangers, which report shall include an analysis demonstrating
in reasonable detail that the pro forma EBITDA of such Person (or
such properties and assets) for the most recently completed four
consecutive fiscal quarters, together with the pro forma EBITDA of
each other Person, the Equity Interests in, or the properties or
assets of which, were previously sold by the Borrower and its
Subsidiaries pursuant to this subsection (viii) during such Fiscal
Year, for the most recently completed four fiscal quarters as of the
date such Person (or such properties or assets) were sold, and does
not, in the aggregate, exceed 7.5% of the EBITDA of the Borrower and
its Subsidiaries for the most recently completed four fiscal
quarters of the Borrower; and (D) the aggregate purchase price paid
to the Borrower and its Subsidiaries for all assets sold pursuant to
this clause (viii) during the term of this Agreement shall not
exceed $50,000,000; and
(ix) so long as no Default shall occur and be continuing, the
grant of any option or other right to purchase any asset in a
transaction that would be permitted under the provisions of clause
(viii) above.
100
100
(g) Investments in Other Persons. Make or hold, or permit any of its
Subsidiaries to make or hold, any Investment in any Person, except:
(i) (A) equity Investments by the Borrower and its
Subsidiaries in their Subsidiaries outstanding on the date hereof,
(B) additional equity Investments in wholly owned
Domestic Subsidiaries of the Borrower existing on the date
hereof or the Equity Interest of which are acquired by the
Borrower or one of its Domestic Subsidiaries pursuant to
clause (xiii) below, including, without limitation,
Investments in newly formed, wholly owned Domestic
Subsidiaries of the Borrower or one of its Domestic
Subsidiaries which are to fund the purchase by such newly
formed Domestic Subsidiary of the assets comprising a division
or business unit or a substantial part of the business of any
other Person if such Investment by such new Subsidiary is made
in accordance with clause (xiii) below, or
(C) additional Investments of the Borrower and its
Domestic Subsidiaries in any of their Foreign Subsidiaries in
an aggregate amount for the Borrower and all its Domestic
Subsidiaries not to exceed $10,000,000 in any Fiscal Year or
(D) additional Investments of the Borrower and any of
its wholly-owned Subsidiaries in Subsidiaries and other
Persons (including joint-ventures) which are not wholly-owned
by the Borrower or its wholly-owned Subsidiaries, but are
controlled by the Borrower or one of its wholly-owned
Subsidiaries, (including, without limitation, Contingent
Obligations incurred by the Borrower or any of its
wholly-owned Subsidiaries in respect of the Debt of any such
Subsidiary or other Person which are not wholly-owned) not at
any time exceeding in the aggregate $5,000,000;
(ii) loans and advances to employees in the ordinary course of
the business of the Borrower and its Subsidiaries as presently
conducted in an aggregate principal amount not to exceed $3,000,000
at any time outstanding;
(iii) Investments by the Borrower and its Subsidiaries in Cash
Equivalents;
(iv) Investments existing on the date hereof and described on
Schedule 4.01(y) hereto;
101
101
(v) Investments in Hedge Agreements permitted under Section
5.02(b);
(vi) Investments consisting of intercompany Debt permitted
under Section 5.02(b);
(vii) Investments consisting of non-cash consideration
received in the form of securities, notes or similar obligations in
connection with dispositions of obsolete or worn out assets
permitted pursuant to Section 5.02(e)(vi) not at any time exceeding,
in the case of all such notes and similar obligations, the amount of
$5,000,000;
(viii) pledges or deposits required in the ordinary course of
business in connection with workmen's compensation, unemployment
insurance and other social security or similar legislation;
(ix) pledges or deposits in connection with (A) non-delinquent
performance of bids, trade contracts (other than for borrowed
money), leases or statutory obligations, (B) contingent obligations
on surety or appeal bonds and (C) other non-delinquent obligations
of a like nature, in each case incurred in the ordinary course of
business;
(x) advances, loans or extensions of credit to suppliers in
the ordinary course of business by Borrower or any Subsidiary
consistent with past practice as of the Effective Date not at any
time exceeding in the aggregate $2,000,000;
(xi) other advances, loans or extensions of credit in the
ordinary course of business by Borrower or any Subsidiary not at any
time exceeding in the aggregate $3,000,000;
(xii) Investments (including debt obligations) received in
connection with the bankruptcy or reorganization of suppliers and
customers and in settlement of delinquent obligations of, and other
disputes with, customers and suppliers arising in the ordinary
course of business; and
(xiii) other Investments; provided that with respect to
Investments made under this clause (xiii): (1) any newly acquired or
organized Subsidiary of the Borrower or any of its Subsidiaries
shall be a wholly owned Domestic Subsidiary thereof; (2) immediately
before and after giving effect thereto, no Default shall have
occurred and be continuing or would result therefrom; (3) any
company or
102
102
business acquired or invested in pursuant to this clause (xiii)
shall be in the specialty chemicals business or in a substantially
similar line of business; (4) immediately after giving effect to the
acquisition of a company or business pursuant to this clause (xiii),
the Borrower shall be in pro forma compliance with the covenants
contained in Section 5.04, calculated based on the financial
statements most recently delivered to the Lender Parties pursuant to
Section 5.03 and as though such acquisition had occurred at the
beginning of the four-quarter period covered thereby, as evidenced
by a certificate of the Chief Financial Officer of the Borrower
delivered to the Lender Parties demonstrating such compliance; (5)
the Borrower shall have delivered to the Administrative Agent and
the Lender Parties an Acquisition Diligence Report for such company
or business which has been approved by the Joint Lead Arrangers; and
(6) any such newly formed Subsidiary shall be in compliance with
Section 5.01(j).
(h) Restricted Payments. Declare or pay any dividends, purchase,
redeem, retire, defease or otherwise acquire for value any of its Equity
Interests now or hereafter outstanding, return any capital to its
stockholders, partners or members (or the equivalent Persons thereof) as
such, make any distribution of assets, Equity Interests, obligations or
securities to its stockholders, partners or members (or the equivalent
Persons thereof) as such or issue or sell any Equity Interests or accept
any capital contributions, or permit any of its Subsidiaries to do any of
the foregoing, or permit any of its Subsidiaries to purchase, redeem,
retire, defease or otherwise acquire for value any Equity Interests in the
Borrower or to issue or sell any Equity Interests therein, except that, so
long as no Default shall have occurred and be continuing at the time of
any action described in clause (i) or (ii) below or would result
therefrom:
(i) the Borrower may (A) declare and pay dividends and
distributions payable only in common stock of the Borrower, (B)
issue and sell shares of its capital stock to (x) the Equity
Investors, or (y) so long as no Default has occurred and is
continuing or would result from such issuance and sale, any other
Persons (C) except to the extent the Net Cash Proceeds thereof are
required to be applied to the prepayment of the Advances pursuant to
Section 2.06(b), purchase, redeem, retire, defease or otherwise
acquire shares of its capital stock with the proceeds received
contemporaneously from the issue of new shares of its capital stock
with equal or inferior voting powers, designations, preferences and
rights, (D) redeem or purchase Equity Interests from the Sponsor or
other shareholders of the Borrower who are not officers, directors
or employees of the Borrower, substantially concurrently with the
issuance and sale of such Equity Interests to employees of the
Borrower and its Subsidiaries; provided, however, that the
redemption or purchase price paid to the Sponsor for such Equity
Interests shall not exceed either (1) the Net Cash Proceeds received
by the Borrower from the
103
103
issuance of such Equity Interests to such employees, or (2)
$5,000,000 in the aggregate for all such redemptions and purchases
during the term of this agreement, (E) accept capital contributions
from the Equity Investors, (F) so long as no Default has occurred
and is continuing or would result from such payment, make payments
in accordance with the Management Agreement and pay fees and
indemnification payments to directors and officers of the Borrower
in the ordinary course of business; provided, however, that the
aggregate amount of all such payments shall not exceed the sum of
$1,600,000 plus the actual out-of-pocket expenses of the Sponsor in
connection with providing management services to Borrower plus such
actual fees, expenses and indemnity payments incurred by such
officers and directors in any Fiscal Year of the Borrower (beginning
with the Fiscal Year ending December 31, 2000), (G) so long as no
Default has occurred and is continuing or would result from such
payment, the Borrower may repurchase, redeem or otherwise acquire or
retire for value any Equity Interests of the Borrower held by
current or former employees of the Borrower or any of its
Subsidiaries pursuant to any employee equity subscription agreement,
stock option agreement or stock ownership arrangement; provided,
however, that the aggregate price paid (including the principal
amount of Debt issued pursuant to Section 5.02(b)(ix)) for all such
repurchased, redeemed, acquired or retired Equity Interests shall
not exceed an aggregate of $2,000,000 over the term of this
Agreement, and (H) issue new shares of its capital stock to the
seller (or its affiliates) of any Equity Interests or assets
purchased by the Borrower or any of its Subsidiaries, as all or a
portion of the purchase price for such Equity Interests or assets
issue in connection with a Permitted Acquisition; and
(ii) any Subsidiary of the Borrower may (A) declare and pay
cash dividends to the Borrower, (B) declare and pay cash dividends
to any other wholly owned Subsidiary of the Borrower of which it is
a Subsidiary and (C) accept capital contributions from its parent to
the extent permitted under Section 5.02(g)(i).
(i) Lease Obligations. Create, incur, assume or suffer to exist, or
permit any of its Subsidiaries to create, incur, assume or suffer to
exist, any obligations as lessee under any operating leases (i) for the
rental or hire of real or personal property in connection with any sale
and leaseback transaction, or (ii) for the rental or hire of other real or
personal property of any kind under leases or agreements to lease having
an original term of one year or more that would cause the direct and
contingent liabilities of the Borrower and its Subsidiaries, on a
Consolidated basis, in respect of all such obligations to exceed
$4,000,000 payable in the period of 12 consecutive months ending on
December 31, 2000 and increasing by $250,000 for each 12 month period
thereafter.
104
104
(j) Amendments of Constitutive Documents. Amend, or permit any of
its Subsidiaries to amend, its certificate of incorporation or bylaws or
other constitutive documents in any manner which would have a material
adverse effect on any rights of the Secured Parties under the Loan
Documents.
(k) Accounting Changes. Make or permit, or permit any of its
Subsidiaries to make or permit, any change in any material respect in
accounting policies or reporting practices, except as required by
generally accepted accounting principles, or any change in Fiscal Year.
(l) Prepayments, Etc., of Debt. Prepay, redeem, purchase, defease or
otherwise satisfy prior to the scheduled maturity thereof in any manner,
or make any payment in violation of any subordination terms of, any Debt,
except (i) the prepayment of the Advances in accordance with the terms of
this Agreement, (ii) the prepayment of Debt permitted pursuant to
5.02(b)(ix) to the extent also permitted pursuant to Section
5.02(h)(i)(G), and (iii) regularly scheduled or required repayments or
redemptions of Surviving Debt, or amend, modify or change in any manner
any term or condition of any Surviving Debt or Subordinated Debt, or
permit any of its Subsidiaries to do any of the foregoing other than to
prepay any Debt payable to the Borrower.
(m) Amendment, Etc., of Related Documents. Cancel or terminate any
Related Document or consent to or accept any cancellation or termination
thereof, amend, modify or change in any material manner any term or
condition of any Related Document or give any consent, waiver or approval
thereunder, waive any default under or any breach of any material term or
condition of any Related Document, agree in any manner to any other
amendment, modification or change of any term or condition of any Related
Document or take any other action in connection with any Related Document
that would impair the value of the interest or rights of any Loan Party
thereunder or that would impair the rights or interests of any Agent or
any Lender Party, or permit any of its Subsidiaries to do any of the
foregoing.
(n) Negative Pledge. Enter into or suffer to exist, or permit any of
its Subsidiaries to enter into or suffer to exist, any agreement
prohibiting or conditioning the creation or assumption of any Lien upon
any of its property or assets except (i) in favor of the Secured Parties
or (ii) in connection with (A) any Surviving Debt, (B) any purchase money
Debt permitted by Section 5.02(b) solely to the extent that the agreement
or instrument governing such Debt prohibits a Lien on the property
acquired with the proceeds of such Debt, (C) any Capitalized Lease
permitted by Section 5.02(b) solely to the extent that such Capitalized
Lease prohibits a Lien on the property subject thereto or (D) any Debt
outstanding on the date any Subsidiary of the Borrower becomes such a
105
105
Subsidiary (so long as such agreement was not entered into solely in
contemplation of such Subsidiary becoming a Subsidiary of the Borrower).
(o) Partnerships, Etc. Become a general partner in any general or
limited partnership or joint venture, or permit any of its Subsidiaries to
do so, other than a Domestic, wholly-owned Subsidiary of the Borrower the
sole assets of which consist of such Subsidiary's interest in one or more
of such partnerships or joint ventures.
(p) Speculative Transactions. Engage, or permit any of its
Subsidiaries to engage, in any transaction involving commodity options or
futures contracts or any similar speculative transactions other than Hedge
Agreements entered into in the ordinary course of business and permitted
by Section 5.02(b).
(q) Capital Expenditures. Make, or permit any of its Subsidiaries to
make, any Capital Expenditures that would cause the aggregate of all such
Capital Expenditures made by the Borrower and its Subsidiaries in any
Fiscal Year of the Borrower to exceed an amount equal to the greatest of
(i) $13,000,000, (ii) 5% of the Consolidated net sales of the Borrower and
its Subsidiaries for the immediately preceding Fiscal Year of the
Borrower, calculated in accordance with GAAP or (iii) at any time after
the Chief Financial Officer of the Borrower shall have delivered a
certificate to the Lender Parties identifying the Permitted Acquisitions
and permitted sales of assets of the Borrower and its Subsidiaries for any
Fiscal Year of the Borrower, together with a calculation of the pro forma
Consolidated net sales of the Borrower and its Subsidiaries for the
preceding Fiscal Year and as though all such Permitted Acquisitions and
dispositions had occurred at the beginning of such preceding Fiscal Year,
5% of such pro forma Consolidated net sales.
(r) Formation of Subsidiaries. Organize or invest, or permit any
Subsidiary to organize or invest, in any new Subsidiary, except as
permitted under Section 5.02(g)(xiii).
(s) Payment Restrictions Affecting Subsidiaries. Directly or
indirectly, enter into or suffer to exist, or permit any of its
Subsidiaries to enter into or suffer to exist, any agreement or
arrangement limiting the ability of any of its Subsidiaries to declare or
pay dividends or other distributions in respect of its Equity Interests or
repay or prepay any Debt owed to, make loans or advances to, or otherwise
transfer assets to or invest in, the Borrower or any Subsidiary of the
Borrower (whether through a covenant restricting dividends, loans, asset
transfers or investments, a financial covenant or otherwise), except (i)
the Loan Documents , (ii) any agreement or instrument evidencing Surviving
Debt and (iii) any agreement in effect at the time such Subsidiary becomes
a Subsidiary of the Borrower, so long as such agreement was not entered
into solely in contemplation of such Person becoming a Subsidiary of the
Borrower.
106
106
(t) Amendment, Etc., of Material Contracts. Cancel or terminate any
Material Contract or consent to or accept any cancellation or termination
thereof, amend or otherwise modify any Material Contract or give any
consent, waiver or approval thereunder, waive any default under or breach
of any Material Contract, agree in any manner to any other amendment,
modification or change of any term or condition of any Material Contract
or take any other action in connection with any Material Contract except
for any such action as would not be reasonably likely to result in a
Material Adverse Effect. The Borrower will use all reasonable efforts, and
will cause its Subsidiaries to use all reasonable efforts to cause any
Material Contract of the type referred to in clauses (iv) of the
definition of such term entered into by the Borrower or such Subsidiary
after the Effective Date not to contain a provision which would, by its
terms, prohibit the assignment by the Borrower or such Subsidiary of its
rights thereunder as security pursuant to the Security Agreement.
SECTION 5.03. Reporting Requirements. So long as any Advance or any
other Obligation of any Loan Party under any Loan Document shall remain unpaid,
any Letter of Credit shall be outstanding or any Lender Party shall have any
Commitment hereunder, the Borrower will furnish to the Agents and the Lender
Parties:
(a) Default Notice. As soon as possible and in any event within two
days after the Borrower or any of its Subsidiaries becomes aware of the
occurrence of each Default or any event, development or occurrence
reasonably likely to have a Material Adverse Effect continuing on the date
of such statement, a statement of the chief financial officer of the
Borrower setting forth details of such Default and the action that the
Borrower has taken and proposes to take with respect thereto.
(b) Annual Financials. As soon as available and in any event within
100 days after the end of each Fiscal Year, a copy of the annual audit
report for such year for the Borrower and its Subsidiaries, including
therein Consolidated balance sheets of the Borrower and its Subsidiaries
as of the end of such Fiscal Year and Consolidated statements of income
and a Consolidated statement of cash flows of the Borrower and its
Subsidiaries for such Fiscal Year, in each case accompanied by an opinion
without a "going concern" or similar qualification or exception or a
qualification arising out of the scope of the audit and otherwise
acceptable to the Administrative Agent of Ernst & Young LLP or other
independent public accountants of recognized standing acceptable to the
Required Lenders, together with (i) a certificate of such accounting firm
to the Lender Parties stating that in the course of the regular audit of
the business of the Borrower and its Subsidiaries, which audit was
conducted by such accounting firm in accordance with generally accepted
auditing standards, such accounting firm has obtained no knowledge that a
Default has occurred and is continuing, or if, in the opinion of such
accounting firm, a Default has occurred and is continuing, a statement as
to the nature thereof, (ii) a
107
107
schedule in form satisfactory to the Administrative Agent of the
computations used by such accountants in determining, as of the end of
such Fiscal Year, compliance with the covenants contained in Section 5.04,
provided that in the event of any change in GAAP used in the preparation
of such financial statements, the Borrower shall also provide, if
necessary for the determination of compliance with Section 5.04, a
statement of reconciliation conforming such financial statements to GAAP
as in effect on the date hereof and (iii) a certificate of the Chief
Financial Officer of the Borrower stating either that such Chief Financial
Officer has, after due inquiry, no knowledge that any Default has occurred
and is continuing or, if the Chief Financial Officer has knowledge that a
Default has occurred and is continuing, a statement as to the nature
thereof and the action that the Borrower has taken and proposes to take
with respect thereto.
(c) Quarterly Financials. As soon as available and in any event
within 45 days after the end of each of the first three quarters of each
Fiscal Year, Consolidated balance sheets of the Borrower and its
Subsidiaries as of the end of such quarter and Consolidated statements of
income and a Consolidated statement of cash flows of the Borrower and its
Subsidiaries for the period commencing at the end of the previous fiscal
quarter and ending with the end of such fiscal quarter and Consolidated
statements of income and a Consolidated statement of cash flows of the
Borrower and its Subsidiaries for the period commencing at the end of the
previous Fiscal Year and ending with the end of such quarter, setting
forth in each case in comparative form the corresponding figures for the
corresponding date or period of the preceding Fiscal Year, all in
reasonable detail and duly certified (subject to normal year-end audit
adjustments and the absence of footnotes) by the Chief Financial Officer
of the Borrower as having been prepared in accordance with GAAP, together
with (i) a certificate of said officer stating either that such Chief
Financial Officer has, after due inquiry, no knowledge that any Default
has occurred and is continuing or, if the Chief Financial Officer has
knowledge that a Default has occurred and is continuing, a statement as to
the nature thereof and the action that the Borrower has taken and proposes
to take with respect thereto and (ii) a schedule in form satisfactory to
the Administrative Agent of the computations used by the Borrower in
determining compliance with the covenants contained in Section 5.04,
provided that in the event of any change in GAAP used in the preparation
of such financial statements, the Borrower shall also provide, if
necessary for the determination of compliance with Section 5.04, a
statement of reconciliation conforming such financial statements to GAAP
in effect on the date hereof.
(d) Annual Forecasts. As soon as available and in any event no later
than 45 days after the end of each Fiscal Year, an annual budget prepared
by management of the Borrower, of balance sheets, income statements and
cash flow statements on a quarterly basis for the Fiscal Year following
such Fiscal Year.
108
108
(e) Litigation. Promptly after the commencement thereof, notice of
all actions, suits, investigations, litigation and proceedings before any
court or governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, affecting any Loan Party or any of
its Subsidiaries of the type described in Section 4.01(f) (except
proceedings that, if adversely determined, would not reasonably be
expected, either individually or in the aggregate, to have a Material
Adverse Effect), and promptly after the occurrence thereof, notice of any
material adverse change in the status or the financial effect on any Loan
Party or any of its Subsidiaries of the Disclosed Litigation from that
described on Schedule 4.01(f) hereto.
(f) Securities Reports. Promptly after the sending or filing
thereof, copies of all proxy statements, financial statements and reports
that any Loan Party or any of its Subsidiaries sends to its stockholders,
and copies of all regular, periodic and special reports, and all
registration statements, that any Loan Party or any of its Subsidiaries
files with the Securities and Exchange Commission or any governmental
authority that may be substituted therefor, or with any national
securities exchange.
(g) Creditor Reports. Promptly after the furnishing thereof, copies
of any statement or report furnished to any holder of Debt securities of
any Loan Party or of any of its Subsidiaries pursuant to the terms of any
indenture, loan or credit or similar agreement and not otherwise required
to be furnished to the Lender Parties pursuant to any other clause of this
Section 5.03.
(h) Agreement Notices. Promptly upon receipt thereof, copies of all
notices, requests and other documents received by any Loan Party or any of
its Subsidiaries under or pursuant to any Related Document or Material
Contract or instrument, indenture, loan or credit or similar agreement
regarding or related to any breach or default by any party thereto or any
other event that could have a Material Adverse Effect and copies of any
proposed amendment, modification or waiver of any provision of any Related
Document or Material Contract or instrument, indenture, loan or credit or
similar agreement and, from time to time upon request by the
Administrative Agent, such information and reports regarding the Related
Documents, the Material Contracts and such instruments, indentures and
loan and credit and similar agreements as the Administrative Agent may
reasonably request.
(i) ERISA. (i) ERISA Events and ERISA Reports. (A) Promptly and in
any event within 10 Business Days after any Loan Party or any ERISA
Affiliate knows or has reason to know that any ERISA Event has occurred, a
statement of the Chief Financial Officer of the Borrower describing such
ERISA Event and the action, if any, that such Loan Party or such ERISA
Affiliate has taken and proposes to take with respect thereto and (B) on
the date any records, documents or other information must be furnished to
the
109
109
PBGC with respect to any Plan pursuant to Section 4010 of ERISA, a copy of
such records, documents and information.
(ii) Plan Terminations. Promptly and in any event within two
Business Days after receipt thereof by any Loan Party or any ERISA
Affiliate, copies of each notice from the PBGC stating its intention to
terminate any Plan or to have a trustee appointed to administer any Plan.
(iii) Plan Annual Reports. Promptly and in any event within 30 days
after a request from the Administrative Agent, copies of each Schedule B
(Actuarial Information) to the annual report (Form 5500 Series) with
respect to each Plan.
(iv) Multiemployer Plan Notices. Promptly and in any event within
ten Business Days after receipt thereof by any Loan Party or any ERISA
Affiliate from the sponsor of a Multiemployer Plan, copies of each notice
concerning (A) the imposition of Withdrawal Liability by any such
Multiemployer Plan, (B) the reorganization or termination, within the
meaning of Title IV of ERISA, of any such Multiemployer Plan or (C) the
amount of liability incurred, or that may be incurred, by such Loan Party
or any ERISA Affiliate in connection with any event described in clause
(A) or (B).
(j) Environmental Conditions. Promptly after the assertion or
occurrence thereof, notice of any Environmental Action against or of any
noncompliance by any Loan Party or any of its Subsidiaries with any
Environmental Law or Environmental Permit that could (i) reasonably be
expected to have a Material Adverse Effect or (ii) cause any property
described in the Mortgages to be subject to any material restrictions on
ownership, occupancy, use or transferability under any Environmental Law.
(k) Real Property. As soon as available and in any event within 100
days after the end of each Fiscal Year, a report supplementing Schedules
4.01(w) and 4.01(x) hereto, including an identification of all owned and
leased real property disposed of by the Borrower or any of its
Subsidiaries during such Fiscal Year, a list and description (including
the street address, county or other relevant jurisdiction, state, record
owner, book value thereof and, in the case of leases of property, lessor,
lessee, expiration date and annual rental cost thereof) of all real
property acquired or leased during such Fiscal Year and a description of
such other changes in the information included in such Schedules as may be
necessary for such Schedules to be accurate and complete.
(l) Insurance. As soon as available and in any event within 30 days
after the end of each Fiscal Year, a report summarizing the insurance
coverage (specifying type, amount and carrier) in effect for the Borrower
and its Subsidiaries and containing such
110
110
additional information as any Agent, or any Lender Party through the
Administrative Agent, may reasonably specify.
(m) Year 2000 Compliance. Promptly after the Borrower's discovery or
determination thereof, notice (in reasonable detail) that any computer
application (including those of its suppliers, vendors and customers) that
is material to its or any of its Subsidiaries' business and operations
will not be Year 2000 Compliant (as defined in Section 4.01(cc)), except
to the extent that such failure could not reasonably be expected to have a
Material Adverse Effect.
(n) Other Information. Such other information respecting the
business, condition (financial or otherwise), operations, performance,
properties or prospects of any Loan Party or any of its Subsidiaries as
any Agent, or any Lender Party through the Administrative Agent, may from
time to time reasonably request.
SECTION 5.04. Financial Covenants. So long as any Advance or any
other Obligation of any Loan Party under any Loan Document shall remain unpaid,
any Letter of Credit shall be outstanding or any Lender Party shall have any
Commitment hereunder, the Borrower will:
(a) Total Debt/EBITDA Ratio. Maintain at the end of each fiscal
quarter of the Borrower a Total Debt/EBITDA Ratio of not more than the
amount set forth below for each period set forth below:
DURING FISCAL YEAR ENDING RATIO
-------
December 31, 2000 5.50:1
December 31, 2001 5.50:1
December 31, 2002 5.25:1
December 31, 2003 5.00:1
December 31, 2004 5.00:1
December 31, 2005 4.75:1
and thereafter
(b) Senior Debt/EBITDA Ratio. Maintain at the end of each fiscal
quarter of the Borrower a Senior Debt/EBITDA Ratio of not more than the
amount set forth below for each period set forth below:
111
111
DURING FISCAL YEAR ENDING RATIO
------
December 31, 2000 4.25:1
December 31, 2001 4.25:1
December 31, 2002 4.00:1
December 31, 2003 3.75:1
December 31, 2004 3.50:1
and thereafter
(c) Fixed Charge Coverage Ratio. Maintain at the end of each fiscal
quarter of the Borrower a Fixed Charge Coverage Ratio of not less than the
amount set forth below for each period set forth below:
DURING FISCAL YEAR ENDING RATIO
------
December 31, 2000 1.10:1
December 31, 2001 1.10:1
December 31, 2002 1.10:1
December 31, 2003 1.15:1
December 31, 2004 1.20:1
and thereafter
(d) Interest Coverage Ratio. Maintain at the end of each fiscal
quarter of the Borrower an Interest Coverage Ratio of not less than the
amount set forth below for each period set forth below:
DURING FISCAL YEAR ENDING RATIO
------
December 31, 2000 1.75:1
December 31, 2001 2.00:1
December 31, 2002 2.00:1
December 31, 2003 2.25:1
December 31, 2004 2.50:1
and thereafter
112
112
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default. If any of the following events
("EVENTS OF DEFAULT") shall occur and be continuing:
(a) (i) the Borrower shall fail to pay any principal of any Advance
when the same shall become due and payable or (ii) the Borrower shall fail
to pay any interest on any Advance, or any Loan Party shall fail to make
any other payment under any Loan Document, in each case under this clause
(ii) within five Business Days after the same becomes due and payable; or
(b) any representation or warranty made by any Loan Party (or any of
its officers) under or in connection with any Loan Document shall prove to
have been incorrect in any material respect when made; or
(c) the Borrower shall fail to perform or observe any term, covenant
or agreement contained in Xxxxxxx 0.00, 0.00(x), (x), xx (x), 5.02, 5.03
or 5.04; or
(d) any Loan Party shall fail to perform or observe any other term,
covenant or agreement contained in any Loan Document on its part to be
performed or observed if such failure shall remain unremedied for 20 days
after the earlier of the date on which (i) a Responsible Officer becomes
aware of such failure or (ii) written notice thereof shall have been given
to the Borrower by the Administrative Agent or any Lender Party; or
(e) any Loan Party or any of its Subsidiaries shall fail to pay any
principal of, premium or interest on or any other amount payable in
respect of any Debt of such Loan Party or such Subsidiary (as the case may
be) that is outstanding in a principal amount (or, in the case of any
Hedge Agreement, an Agreement Value) of at least $5,000,000 either
individually or in the aggregate (but excluding Debt outstanding
hereunder), 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 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 permit the acceleration of, the maturity of such Debt or otherwise to
cause, or to permit the holder thereof to cause, such Debt to mature; or
any such Debt shall be declared to be due and payable or required to be
prepaid or redeemed (other than by a regularly scheduled required
prepayment or redemption), purchased or defeased, or an offer to prepay,
redeem, purchase or defease such Debt shall be required to be made, in
113
113
each case prior to the stated maturity thereof; provided, however, that
this subsection (e) shall not apply to any secured Debt, that becomes due
as a result of a voluntary sale or transfer of the assets securing such
Debt; or
(f) any Loan Party or any of its Subsidiaries or SSCI Investors
shall generally not pay its debts as such debts become due, or shall admit
in writing its inability to pay its debts generally, or shall make a
general assignment for the benefit of creditors; or any proceeding shall
be instituted by or against any Loan Party or any of its Subsidiaries
seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation,
winding up, reorganization, arrangement, adjustment, protection, relief,
or composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry of
an order for relief or the appointment of a receiver, trustee or other
similar official for it or for any substantial part of its property and,
in the case of any such proceeding instituted against it (but not
instituted by it) that is being diligently contested by it in good faith,
either such proceeding shall remain undismissed or unstayed for a period
of 60 days or any of the actions sought in such proceeding (including,
without limitation, the entry of an order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official
for, it or any substantial part of its property) shall occur; or any Loan
Party or any of its Subsidiaries shall take any corporate action to
authorize any of the actions set forth above in this subsection (f); or
(g) any judgments or orders, either individually or in the
aggregate, for the payment of money in excess of $5,000,000 (exclusive of
any amounts fully covered by insurance (less any applicable deductible) or
indemnification and as to which the insurer or the indemnifying party, as
the case may be, has acknowledged its obligation to cover such judgment or
order) shall be rendered against any Loan Party or any of its Subsidiaries
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
25 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
(h) any non-monetary judgment or order shall be rendered against any
Loan Party or any of its Subsidiaries that would reasonably be expected to
have a Material Adverse Effect, and there shall be any period of 25
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
(i) any provision of any Loan Document after delivery thereof
pursuant to Section 3.01, 5.01(j) or 5.01(q) shall for any reason cease to
be valid and binding on or enforceable against any Loan Party party to it,
or any such Loan Party shall so state in writing; or
114
114
(j) any Collateral Document after delivery thereof pursuant to
Section 3.01 or 5.01(j) or 5.01(q) shall for any reason (other than
pursuant to the terms thereof) cease to create a valid and perfected first
priority lien on and security interest in the Collateral purported to be
covered thereby; or
(k) a Change of Control shall occur; or
(l) any ERISA Event shall have occurred with respect to a Plan and
the sum (determined as of the date of occurrence of such ERISA Event) of
the Insufficiency of such Plan and the Insufficiency of any and all other
Plans with respect to which an ERISA Event shall have occurred and then
exist (or the liability of the Loan Parties and the ERISA Affiliates
related to such ERISA Event) exceeds $1,000,000; or
(m) any Loan Party or any ERISA Affiliate shall have been notified
by the sponsor of a Multiemployer Plan that it has incurred Withdrawal
Liability to such Multiemployer Plan in an amount that, when aggregated
with all other amounts required to be paid to Multiemployer Plans by the
Loan Parties and the ERISA Affiliates as Withdrawal Liability (determined
as of the date of such notification), exceeds $2,000,000 or requires
payments exceeding $1,000,000 per annum; or
(n) any Loan Party or any ERISA Affiliate shall have been notified
by the sponsor of a Multiemployer Plan that such Multiemployer Plan is in
reorganization or is being terminated, within the meaning of Title IV of
ERISA, and as a result of such reorganization or termination the aggregate
annual contributions of the Loan Parties and the ERISA Affiliates to all
Multiemployer Plans that are then in reorganization or being terminated
have been or will be increased over the amounts contributed to such
Multiemployer Plans for the plan years of such Multiemployer Plans
immediately preceding the plan year in which such reorganization or
termination occurs by an amount exceeding $1,000,000; or
(o) an "Event of Default" (as defined in any Mortgage) shall have
occurred and be continuing;
then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to the Borrower,
declare the Commitments of each Lender Party and the obligation of each Lender
Party to make Advances (other than Letter of Credit Advances by the Issuing Bank
or a Revolving Credit Lender pursuant to Section 2.03(c) and Swing Line Advances
by a Revolving Credit Lender pursuant to Section 2.02(b)) and of the Issuing
Bank to issue Letters of Credit to be terminated, whereupon the same shall
forthwith terminate, and (ii) shall at the request, or may with the consent, of
the Required Lenders, (A) by
115
115
notice to the Borrower, declare the Notes, all interest thereon and all other
amounts payable under this Agreement and the other Loan Documents to be
forthwith due and payable, whereupon the Notes, all such interest and all such
amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived by the Borrower, (B) by notice to each party required under the terms of
any agreement in support of which a Standby Letter of Credit is issued, request
that all Obligations under such agreement be declared to be due and payable and
(C) by notice to the Issuing Bank, direct the Issuing Bank to deliver a Default
Termination Notice to the beneficiary of each Standby Letter of Credit issued by
it, and the Issuing Bank shall deliver such Default Termination Notices;
provided, however, that in the event of an actual or deemed entry of an order
for relief with respect to the Borrower under the Federal Bankruptcy Code, (x)
the Commitments of each Lender Party and the obligation of each Lender Party to
make Advances (other than Letter of Credit Advances by the Issuing Bank or a
Revolving Credit Lender pursuant to Section 2.03(c) and Swing Line Advances by a
Revolving Credit Lender pursuant to Section 2.02(b)) and of the Issuing Bank to
issue Letters of Credit shall automatically be terminated and (y) the Notes, all
such interest and all such amounts shall automatically become and be due and
payable, without presentment, demand, protest or any notice of any kind, all of
which are hereby expressly waived by the Borrower.
SECTION 6.02. Actions in Respect of the Letters of Credit upon
Default. If any Event of Default shall have occurred and be continuing, the
Administrative Agent may, or shall at the request of the Required Lenders,
irrespective of whether it is taking any of the actions described in Section
6.01 or otherwise, make demand upon the Borrower to, and forthwith upon such
demand the Borrower will, pay to the Administrative Agent on behalf of the
Lender Parties in same day funds at the Administrative Agent's office designated
in such demand, for deposit in the L/C Cash Collateral Account, an amount equal
to the aggregate Available Amount of all Letters of Credit then outstanding. If
at any time the Administrative Agent or the Administrative Agent determines that
any funds held in the L/C Cash Collateral Account are subject to any right or
claim of any Person other than the Agents and the Lender Parties or that the
total amount of such funds is less than the aggregate Available Amount of all
Letters of Credit, the Borrower will, forthwith upon demand by the
Administrative Agent or the Administrative Agent, pay to the Administrative
Agent, as additional funds to be deposited and held in the L/C Cash Collateral
Account, an amount equal to the excess of (a) such aggregate Available Amount
over (b) the total amount of funds, if any, then held in the L/C Cash Collateral
Account that the Administrative Agent or the Administrative Agent, as the case
may be, determines to be free and clear of any such right and claim. Upon the
drawing of any Letter of Credit for which funds are on deposit in the L/C Cash
Collateral Account, such funds shall be applied to reimburse the Issuing Bank or
Lenders, as applicable, to the extent permitted by applicable law.
ARTICLE VII
116
116
THE AGENTS
SECTION 7.01. Authorization and Action. Each Lender Party (in its
capacities as a Lender, Swing Line Bank (if applicable), Issuing Bank (if
applicable) and on behalf of itself and its Affiliates as potential Hedge Banks)
hereby appoints and authorizes each Agent to take such action as agent on its
behalf and to exercise such powers and discretion under this Agreement and the
other Loan Documents as are delegated to such Agent by the terms hereof and
thereof, together with such powers and discretion as are reasonably incidental
thereto. As to any matters not expressly provided for by the Loan Documents
(including, without limitation, enforcement or collection of the Notes), no
Agent shall be required to exercise any discretion or take any action, but shall
be required to act or to refrain from acting (and shall be fully protected in so
acting or refraining from acting) upon the instructions of the Required Lenders,
and such instructions shall be binding upon all Lender Parties and all holders
of Notes; provided, however, that no Agent shall be required to take any action
that exposes such Agent to personal liability or that is contrary to this
Agreement or applicable law. Each Agent agrees to give to each Lender Party
prompt notice of each notice given to it by the Borrower pursuant to the terms
of this Agreement.
SECTION 7.02. Agents' Reliance, Etc. Neither any Agent nor any of
their respective directors, officers, agents or employees shall be liable for
any action taken or omitted to be taken by it or them under or in connection
with the Loan Documents, except for its or their own gross negligence or willful
misconduct. Without limitation of the generality of the foregoing, each Agent:
(a) may treat the payee of any Note as the holder thereof until, in the case of
the Administrative Agent, the Administrative Agent receives and accepts an
Assignment and Acceptance entered into by the Lender that is the payee of such
Note, as assignor, and an Eligible Assignee, as assignee, or, in the case of any
other Agent, such Agent has received notice from the Administrative Agent that
it has received and accepted such Assignment and Acceptance, in each case as
provided in Section 8.07; (b) may consult with legal counsel (including counsel
for any Loan Party), independent public accountants and other experts selected
by it and shall not be liable for any action taken or omitted to be taken in
good faith by it in accordance with the advice of such counsel, accountants or
experts; (c) makes no warranty or representation to any Lender Party and shall
not be responsible to any Lender Party for any statements, warranties or
representations (whether written or oral) made in or in connection with the Loan
Documents; (d) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of any
Loan Document on the part of any Loan Party or to inspect the property
(including the books and records) of any Loan Party; (e) shall not be
responsible to any Lender Party for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with, any Loan Document or any other instrument or
document furnished pursuant thereto; and (f) shall incur no liability under or
in
117
117
respect of any Loan Document by acting upon any notice, consent, certificate or
other instrument or writing (which may be by telegram, telecopy or telex)
believed by it to be genuine and signed or sent by the proper party or parties.
SECTION 7.03. Chase, X.X. Xxxxxx, ML&Co. and Affiliates. With
respect to its Commitments or the Commitments of its Affiliates, the Advances
made by it or the Advances made by its Affiliates and the Notes issued to it or
to its Affiliates, Chase, X.X. Xxxxxx and ML&Co. and their Affiliates shall have
the same rights and powers under the Loan Documents as any other Lender Party
and may exercise the same as though it or its Affiliate were not an Agent; and
the term "Lender Party" or "Lender Parties" shall, unless otherwise expressly
indicated, include Xxxxx, Xxxxxx Guaranty Trust Company of New York and Xxxxxxx
Xxxxx Capital Corporation in their respective individual capacities. Xxxxx,
Xxxxxx Guaranty Trust Company of New York and Xxxxxxx Xxxxx Capital Corporation
and their respective Affiliates may accept deposits from, lend money to, act as
trustee under indentures of, accept investment banking engagements from and
generally engage in any kind of business with, any Loan Party, any of its
Subsidiaries and any Person that may do business with or own securities of any
Loan Party or any such Subsidiary, all as if Chase, X.X. Xxxxxx and ML&Co. were
not Agents and without any duty to account therefor to the Lender Parties.
SECTION 7.04. Lender Party Credit Decision. Each Lender Party
acknowledges that it has, independently and without reliance upon any Agent or
any other Lender Party and based on the financial statements referred to in
Section 4.01 and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender Party also acknowledges that it will, independently and
without reliance upon any Agent or any other Lender Party and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement.
SECTION 7.05. Indemnification. (a) Each Lender Party severally
agrees to indemnify each Agent (to the extent not promptly reimbursed by the
Borrower) from and against such Lender Party's ratable share (determined as
provided below) of any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever that may be imposed on, incurred by, or asserted
against such Agent in any way relating to or arising out of the Loan Documents
or any action taken or omitted by such Agent under the Loan Documents; provided,
however, that no Lender Party shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from such Agent's gross negligence or
willful misconduct as found in a final, non-appealable judgment by a court of
competent jurisdiction. Without limitation of the foregoing, each Lender Party
agrees to reimburse each Agent promptly upon demand for its ratable share of any
costs and expenses (including, without limitation, fees and expenses of counsel)
payable by the Borrower under
118
118
Section 8.04, to the extent that such Agent is not promptly reimbursed for such
costs and expenses by the Borrower.
(b) Each Lender Party severally agrees to indemnify the Issuing Bank
(to the extent not promptly reimbursed by the Borrower) from and against such
Lender Party's ratable share (determined as provided below) of any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever that may be
imposed on, incurred by, or asserted against the Issuing Bank in any way
relating to or arising out of the Loan Documents or any action taken or omitted
by the Issuing Bank under the Loan Documents; provided, however, that no Lender
Party shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the Issuing Bank's gross negligence or willful misconduct as
found in a final, non-appealable judgment by a court of competent jurisdiction.
Without limitation of the foregoing, each Lender Party agrees to reimburse the
Issuing Bank promptly upon demand for its ratable share of any costs and
expenses (including, without limitation, fees and expenses of counsel) payable
by the Borrower under Section 8.04, to the extent that the Issuing Bank is not
promptly reimbursed for such costs and expenses by the Borrower.
(c) For purposes of this Section 7.05, the Lender Parties'
respective ratable shares of any amount shall be determined, at any time,
according to the sum of (i) the aggregate principal amount of the Advances
outstanding at such time and owing to the respective Lender Parties, (ii) their
respective Pro Rata Shares of the aggregate Available Amount of all Letters of
Credit outstanding at such time, (iii) the aggregate unused portions of their
respective Term A Commitments and Term B Commitments at such time and (iv) their
respective Unused Revolving Credit Commitments at such time; provided that the
aggregate principal amount of Swing Line Advances owing to the Swing Line Bank
and of Letter of Credit Advances owing to the Issuing Bank shall be considered
to be owed to the Revolving Credit Lenders ratably in accordance with their
respective Revolving Credit Commitments. The failure of any Lender Party to
reimburse any Agent or the Issuing Bank, as the case may be, promptly upon
demand for its ratable share of any amount required to be paid by the Lender
Parties to such Agent or the Issuing Bank, as the case may be, as provided
herein shall not relieve any other Lender Party of its obligation hereunder to
reimburse such Agent or the Issuing Bank, as the case may be, for its ratable
share of such amount, but no Lender Party shall be responsible for the failure
of any other Lender Party to reimburse such Agent or the Issuing Bank, as the
case may be, for such other Lender Party's ratable share of such amount. Without
prejudice to the survival of any other agreement of any Lender Party hereunder,
the agreement and obligations of each Lender Party contained in this Section
7.05 shall survive the payment in full of principal, interest and all other
amounts payable hereunder and under the other Loan Documents.
119
119
SECTION 7.06. Successor Agents. Any Agent may resign at any time by
giving written notice thereof to the Lender Parties and the Borrower and may be
removed at any time with or without cause by the Required Lenders. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint a
successor Agent which, so long as no Default has occurred and is continuing,
shall be approved by the Borrower (such approval not to be unreasonably
withheld), and, which shall be a commercial bank organized under the laws of the
United States or of any State thereof and having a combined capital and surplus
of at least $1,000,000,000. If no successor Agent shall have been so appointed
by the Required Lenders, and shall have accepted such appointment, within 30
days after the retiring Agent's giving of notice of resignation or the Required
Lenders' removal of the retiring Agent, then the retiring Agent may, on behalf
of the Lender Parties, appoint a successor Agent. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent and, in the case of a
successor Administrative Agent, upon the execution and filing or recording of
such financing statements, or amendments thereto, and such amendments or
supplements to the Mortgages, and such other instruments or notices, as may be
necessary or desirable, or as the Required Lenders may request, in order to
continue the perfection of the Liens granted or purported to be granted by the
Collateral Documents, such successor Agent shall 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 under the Loan Documents. Upon the acceptance of any appointment as
Agent hereunder by a successor Agent as to less than all of the Facilities and,
in the case of a successor Administrative Agent, upon the execution and filing
or recording of such financing statements, or amendments thereto, and such
amendments or supplements to the Mortgages, and such other instruments or
notices, as may be necessary or desirable, or as the Required Lenders may
request, in order to continue the perfection of the Liens granted or purported
to be granted by the Collateral Documents, such successor Agent shall succeed to
and become vested with all the rights, powers, discretion, privileges and duties
of the retiring Agent as to such Facilities, other than with respect to funds
transfers and other similar aspects of the administration of Borrowings under
such Facilities, issuances of Letters of Credit (notwithstanding any resignation
as Agent with respect to the Letter of Credit Facility) and payments by the
Borrower in respect of such Facilities, and the retiring Administrative Agent
shall be discharged from its duties and obligations under this Agreement as to
such Facilities, other than as aforesaid. If within 45 days after written notice
is given of the retiring Agent's resignation or removal under this Section 7.06
no successor Agent shall have been appointed and shall have accepted such
appointment, then on such 45th day (a) the retiring Agent's resignation or
removal shall become effective, (b) the retiring Agent shall thereupon be
discharged from its duties and obligations under the Loan Documents and (c) the
Required Lenders shall thereafter perform all duties of the retiring Agent under
the Loan Documents until such time, if any, as the Required Lenders appoint a
successor Agent as provided above. After any retiring Agent's resignation or
removal hereunder as Agent shall have become effective, the provisions of this
Article VII shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent under this Agreement.
120
120
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc. No amendment or waiver of any
provision of this Agreement or the Notes or any other Loan Document, nor consent
to any departure by any Loan Party therefrom, shall in any event be effective
unless the same shall be in writing and signed (or, in the case of the
Collateral Documents, consented to) by the Required Lenders, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that
(a) no amendment, waiver or consent shall, unless in writing
and signed by the Borrower and all of the Lenders (other than any
Lender Party that is, at such time, a Defaulting Lender), do any of the
following at any time:
(i) waive any of the conditions specified in Section
3.01 or, in the case of the Initial Extension of Credit,
Section 3.02,
(ii) change the number of Lenders or the percentage
of (x) the Commitments, (y) the aggregate unpaid principal
amount of the Advances or (z) the aggregate Available Amount
of outstanding Letters of Credit that, in each case, shall be
required for the Lenders or any of them to take any action
hereunder,
(iii) reduce or limit the obligations of any
Subsidiary Guarantor under Section 1 of the Subsidiary
Guaranty issued by it or release such Subsidiary Guarantor or
otherwise limit such Subsidiary Guarantor's liability with
respect to the Obligations owing to the Agents and the Lender
Parties (other than, (x) to the extent permitted under the
Subsidiary Guaranty, (y) pursuant to a merger permitted
pursuant to Section 5.02(e) or (z) in connection with a sale
of such Subsidiary Guarantor permitted pursuant to Section
5.02(f) or a waiver of such Section effected with the consent
of the Required Lenders),
(iv) release all or substantially all of the
Collateral in any transaction or series of related
transactions or permit the creation, incurrence, assumption or
existence of any Lien on all or substantially all of the
Collateral in any transaction or series of related
transactions to secure any Obligations other than Obligations
owing to the Secured Parties under the Loan Documents, or
121
121
(v) amend Section 2.13 or this Section 8.01;
(b) no amendment, waiver or consent shall, unless in writing
and signed by the Borrower and the Required Lenders and each Lender
(other than any Lender that is, at such time, a Defaulting Lender) that
has a Commitment under the Term A Facility, Term B Facility or
Revolving Credit Facility if such Lender is directly affected by such
amendment, waiver or consent,
(i) increase the Commitments of such Lender (it being
understood that waivers or modification of conditions
precedent, covenants, Defaults or Events of Default or a
mandatory reduction in the Revolving Credit Facility shall not
constitute an increase of the Commitment of any Lender, and
that an increase in the available portion of any Commitment of
any Lender shall not constitute an increase in the Commitment
of such Lender for these purposes),
(ii) reduce the principal of, or interest on, the
Notes held by such Lender or any fees or other amounts payable
hereunder to such Lender (other than as a result of any waiver
of the applicability of any post default increase in interest
rates; it being understood that any amendment or modification
to the financial definitions in this Agreement shall not
constitute a reduction in any rate of interest or fees for
these purposes, notwithstanding the fact that such amendment
or modification actually results in such a reduction, so long
as the primary purpose (as determined in good faith by the
Joint Lead Arrangers) of the respective amendment or
modification was not to decrease the pricing pursuant to this
Agreement), or
(iii) postpone any date fixed for any payment of
principal of, or interest on, the Notes held by such Lender
pursuant to Section 2.04 or 2.07 or any fees or other amounts
payable hereunder to such Lender pursuant to Section 2.08;
(c) no amendment, waiver or consent shall, unless in writing
and signed by the Borrower and the Required Lenders and, if the Lenders
that have Commitments under, or are owed any amounts under or in
respect of, any Facility are directly affected by such amendment,
waiver or consent, Lenders holding more than 50% of the aggregate
Commitments under the Term A Facility, the Term B Facility or the
Revolving Credit Facility, change the order of application of any
reduction in the Commitments or any prepayment of Advances between the
Term A Facility and the Term B Facility from the application thereof
set forth in the applicable provisions of Section 2.06(b)(v) in any
manner that materially affects the Lenders under such Facility or
require the permanent reduction of the Revolving Credit Facility at any
time when all or a portion of either Term Facility remains in effect;
122
122
(d) no amendment, waiver or consent shall, unless in writing
and signed by the Swing Line Bank or the Issuing Bank, as the case may
be, in addition to the Lenders required above to take such action,
affect the rights or obligations of the Swing Line Bank or of the
Issuing Bank, as the case may be, under this Agreement; and
(e) no amendment, waiver or consent shall, unless in writing
and signed by an Agent in addition to the Lenders required above to
take such action, affect the rights or duties of such Agent under this
Agreement or the other Loan Documents.
At any time that no Default shall have occurred and be continuing, if, in
connection with any proposed change, waiver, discharge or termination to any of
the provisions of this Agreement as contemplated by subsection (c) of this
Section 8.01, the consent of the Required Lenders is obtained but the consent of
one or more of such other Lenders whose consent is required is not obtained,
then the Borrower shall have the right, so long as all non-consenting Lenders
whose individual consent is required are treated as described below, to replace
each such nonconsenting Lender or Lenders with one or more Eligible Assignees so
long as at the time of such replacement, each such Eligible Assignee consents to
the proposed change, waiver, discharge or termination. At the time any such
non-consenting Lender (a "DEPARTING LENDER") is replaced by an Eligible Assignee
(a "REPLACEMENT LENDER") designated by the Borrower hereunder, the Replacement
Lender and the Departing Lender shall enter into an Assignment and Acceptance
pursuant to Section 8.07 pursuant to which all of the Commitments, Advances and
Notes owed to, or held by, the Departing Lender are assigned to the Replacement
Lender, against payment by the Replacement Lender to the Departing Lender of an
amount equal to the principal amount of such outstanding Advances, together with
accrued and unpaid interest on such Advances to the date of assignment and all
accrued and unpaid fees and other amounts due to the Departing Lender hereunder
on such date. The Borrower or the Replacement Lender shall pay the
Administrative Agent's fees in connection with any such assignment.
SECTION 8.02. Notices, Etc. All notices and other
communications provided for hereunder shall be in writing (including
telegraphic, telecopy or telex communication) and mailed, telegraphed,
telecopied, telexed or delivered, if to the Borrower, at its address at 000 Xxxx
Xxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, XX 00000, Telecopy Number: (312)
419-4034, Attention: Xxxx X. Xxxxxx; if to any Initial Lender Party, at its
Domestic Lending Office specified opposite its name on Schedule I hereto; if to
any other Lender Party, at its Domestic Lending Office specified in the
Assignment and Acceptance pursuant to which it became a Lender Party; if to
Chase, in its capacity as the Administrative Agent, at its address at The Loan
and Agency Services Group, One Chase Xxxxxxxxx Xxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Telecopy Number: (000) 000-0000, Attention: Xxxxxxx Xxxxxxxxx, with
a copy, in the case of all notices other than Notices of Borrowing, Notices of
Issuance, Notices of Renewal and Notices of Swing Line Borrowers, to The Chase
Manhattan Bank, 000 Xxxx Xxxxxx, 00xx Xxxxx,
000
000
Xxx Xxxx, Xxx Xxxx 00000, Telecopy Number: (000) 000-0000, Attention: Xxxxxxxx
Xxxxxxx; if to ML&Co. in its capacity as a Joint Lead Arranger, Joint Book
Manager or Syndication Agent, at its address at World Financial Center, North
Tower, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Telecopy Number: (212)
449-8635, Attention: Xxx Xxxxxxxx; if to X.X. Xxxxxx in its capacity as a Joint
Lead Arranger, Joint Book Manager or Documentation Agent, at its address at 00
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, Telecopy Number: (000) 000-0000,
Attention: Xxxx Xxxxxxx; or, as to the Borrower or the Administrative Agent, at
such other address as shall be designated by such party in a written notice to
the other parties 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
Administrative Agent. All such notices and other communications shall, when
mailed, telegraphed, telecopied or telexed, be effective when deposited in the
mails, delivered to the telegraph company, transmitted by telecopier or
confirmed by telex answerback, respectively, except that notices and
communications to any Agent pursuant to Article II, III or VII shall not be
effective until received by such Agent. Delivery by telecopier of an executed
counterpart of any amendment or waiver of any provision of this Agreement or the
Notes or of any Exhibit hereto to be executed and delivered hereunder shall be
effective as delivery of an original executed counterpart thereof.
SECTION 8.03. No Waiver; Remedies. No failure on the part of
any Lender Party or any Agent to exercise, and no delay in exercising, any right
hereunder or under any Note shall operate as a waiver thereof; nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
SECTION 8.04. Costs and Expenses. (a) The Borrower agrees to
pay on demand (i) all reasonable costs and expenses of each Agent in connection
with the preparation, execution, delivery, administration, modification and
amendment of the Loan Documents (including, without limitation, (A) all due
diligence, collateral review, syndication, transportation, computer,
duplication, appraisal, audit, insurance, consultant, search, filing and
recording fees and expenses and (B) the reasonable fees and expenses of counsel
for the Syndication Agent with respect thereto, with respect to advising such
Agent as to its rights and responsibilities, or the perfection, protection or
preservation of rights or interests, under the Loan Documents (including,
without limitation, pursuant to Section 5.01(j), (k), (m) and (q)), with respect
to negotiations with any Loan Party or with other creditors of any Loan Party or
any of its Subsidiaries arising out of any Default or any events or
circumstances that may give rise to a Default and with respect to presenting
claims in or otherwise participating in or monitoring any bankruptcy, insolvency
or other similar proceeding involving creditors' rights generally and any
proceeding ancillary thereto) and (ii) all costs and expenses of each Agent and
each Lender Party in connection with the enforcement of the Loan Documents,
whether in any action, suit or litigation, or any bankruptcy, insolvency or
other similar proceeding affecting creditors' rights
124
124
generally (including, without limitation, the reasonable fees and expenses of
counsel for the Administrative Agent and each Lender Party with respect
thereto).
(b) The Borrower agrees to indemnify, defend and save and hold
harmless each Agent, each Lender Party and each of their Affiliates and their
respective officers, directors, employees, agents and advisors (each, an
"INDEMNIFIED PARTY") from and against, and shall pay on demand, any and all
claims, damages, losses, liabilities and expenses (including, without
limitation, reasonable fees and expenses of counsel) 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 preparation of a
defense in connection therewith) (i) the Facilities, the actual or proposed use
of the proceeds of the Advances or the Letters of Credit, the Transaction
Documents or any of the transactions contemplated thereby, including, without
limitation, the Offer to Purchase and any Permitted Acquisition or other
proposed acquisition (including, without limitation, the Acquisition) by the
Borrower or any of Subsidiaries or (ii) the actual or alleged presence of
Hazardous Materials on any property of any Loan Party or any of its Subsidiaries
or any Environmental Action relating in any way to any Loan Party or any of its
Subsidiaries, except to the extent such claim, damage, loss, liability or
expense is found in a final, non-appealable judgment by a court of competent
jurisdiction to have resulted from such Indemnified Party's bad faith, gross
negligence or willful misconduct. In the case of an investigation, litigation or
other proceeding to which the indemnity in this Section 8.04(b) applies, such
indemnity shall be effective whether or not such investigation, litigation or
proceeding is brought by any Loan Party, its directors, shareholders or
creditors or an Indemnified Party, whether or not any Indemnified Party is
otherwise a party thereto and whether or not the Transaction is consummated. The
Borrower also agrees that no Indemnified Party shall have any liability (whether
direct or indirect, in contract or tort or otherwise) for any Losses to any Loan
Party or any Loan Party's security holders or creditors resulting from, arising
out of or in any way related to or by reason of, the Facilities, the actual or
proposed use of the proceeds of the Advances or the Letters of Credit, the
Transaction Documents or any of the transactions contemplated by the Transaction
Documents except to the extent that any Loss resulted from the gross negligence
or bad faith of such Indemnified Person.
(c) If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made by the Borrower to or for the account of a
Lender Party other than on the last day of the Interest Period for such Advance,
as a result of a payment or Conversion pursuant to Section 2.06, 2.09(b)(i) or
2.10(d), acceleration of the maturity of the Notes pursuant to Section 6.01 or
for any other reason, or by an Eligible Assignee to a Lender Party other than on
the last day of the Interest Period for such Advance upon an assignment of
rights and obligations under this Agreement pursuant to Section 8.07 as a result
of a demand by the Borrower pursuant to Section 8.07(a), or if the Borrower
fails to make any payment or prepayment of an Advance for which a notice of
prepayment has been given or that is otherwise required to be made,
125
125
whether pursuant to Section 2.04, 2.06 or 6.01 or otherwise, the Borrower shall,
upon demand by such Lender Party (with a copy of such demand to the
Administrative Agent), pay to the Administrative Agent for the account of such
Lender Party any amounts required to compensate such Lender Party for any
additional losses, costs or expenses that it may reasonably incur as a result of
such payment or Conversion or such failure to pay or prepay, as the case may be,
including, without limitation, any loss (including loss of anticipated profits),
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by any Lender Party to fund or maintain such
Advance.
(d) If any Loan Party fails to pay when due any costs,
expenses or other amounts payable by it under any Loan Document, including,
without limitation, fees and expenses of counsel and indemnities, such amount
may be paid on behalf of such Loan Party by the Administrative Agent or any
Lender Party, in its sole discretion.
(e) Without prejudice to the survival of any other agreement
of any Loan Party hereunder or under any other Loan Document, the agreements and
obligations of the Borrower contained in Sections 2.10 and 2.12 and this Section
8.04 shall survive the payment in full of principal, interest and all other
amounts payable hereunder and under any of the other Loan Documents.
SECTION 8.05. Right of Set-off. Upon (a) the occurrence and
during the continuance of any Event of Default and (b) the making of the request
or the granting of the consent specified by Section 6.01 to authorize the
Administrative Agent to declare the Notes due and payable pursuant to the
provisions of Section 6.01, each Agent and each Lender Party and each of their
respective Affiliates is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and otherwise 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 Agent, such Lender Party
or such Affiliate 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
the Loan Documents, irrespective of whether such Agent or such Lender Party
shall have made any demand under this Agreement or such Note or Notes and
although such Obligations may be unmatured. Each Agent and each Lender Party
agrees promptly to notify the Borrower after any such set-off and application;
provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of each Agent and each
Lender Party and their respective Affiliates under this Section are in addition
to other rights and remedies (including, without limitation, other rights of
set-off) that such Agent, such Lender Party and their respective Affiliates may
have.
SECTION 8.06. Binding Effect. This Agreement shall become
effective when it shall have been executed by the Borrower and each Agent and
the Administrative Agent shall have been notified by each Initial Lender Party
that such Initial Lender Party has executed it and
126
126
thereafter shall be binding upon and inure to the benefit of the Borrower, each
Agent and each Lender Party and their respective successors and assigns, except
that the Borrower shall not have the right to assign its rights hereunder or any
interest herein without the prior written consent of the Lender Parties.
SECTION 8.07. Assignments and Participations. (a) Each Lender
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 Commitment or Commitments, the Advances owing to it and the Note
or Notes held by it); provided, however, that (i) each such assignment shall be
of a uniform, and not a varying, percentage of all rights and obligations under
and in respect of one or more Facilities, (ii) except in the case of an
assignment to a Person that, immediately prior to such assignment, was a Lender,
an Affiliate of any Lender or an Approved Fund of any Lender or an assignment of
all of a Lender's rights and obligations under this Agreement, the aggregate
amount of the Commitments being assigned to such Eligible Assignee pursuant to
such assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $1,000,000 (or such
lesser amount as shall be approved by the Administrative Agent and, so long as
no Default shall have occurred and be continuing at the time of effectiveness of
such assignment, the Borrower) under each Facility for which a Commitment is
being assigned, (iii) except in the case of an assignment to a Person that,
immediately prior to such assignment was a Lender, an Affiliate of any Lender or
an Approved Fund of any Lender, each such assignment shall be to an Eligible
Assignee approved by the Administrative Agent and, so long as no Default shall
have occurred, the Borrower, such consent not to be unreasonably withheld, (iv)
no such assignments shall be permitted without the consent of the Joint Lead
Arrangers until the Joint Lead Arrangers shall have notified the Lender Parties
that syndication of the Commitments hereunder has been completed and (v) the
parties to each such assignment shall execute and deliver to the Administrative
Agent, for its acceptance and recording in the Register, an Assignment and
Acceptance, together with any Note or Notes subject to such assignment and a
processing and recordation fee of $3,500.
(b) Upon such execution, delivery, acceptance and recording,
from and after the effective date specified in such Assignment and Acceptance,
(i) the assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, have the rights and obligations of a Lender or
Issuing Bank, as the case may be, hereunder and (ii) the Lender or Issuing Bank
assignor thereunder shall, to the extent that rights and obligations hereunder
have been assigned by it pursuant to such Assignment and Acceptance, relinquish
its rights (other than its rights under Sections 2.10, 2.12 and 8.04 to the
extent any claim thereunder relates to an event arising prior to such
assignment) and be released from its obligations under this Agreement (and, in
the case of an Assignment and Acceptance covering all of the remaining portion
of an assigning Lender's or Issuing Bank's rights and obligations under this
Agreement, such Lender or Issuing Bank shall cease to be a party hereto).
127
127
(c) By executing and delivering an Assignment and Acceptance,
each Lender Party assignor thereunder and each assignee thereunder confirm to
and agree with each other and the other parties thereto and hereto as follows:
(i) other than as provided in such Assignment and Acceptance, such assigning
Lender Party makes no representation or warranty and assumes no responsibility
with respect to any statements, warranties or representations made in or in
connection with any Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with, any Loan Document or any other instrument or
document furnished pursuant thereto; (ii) such assigning Lender Party makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of any Loan Party or the performance or observance by any
Loan Party of any of its obligations under any Loan Document or any other
instrument or document furnished pursuant thereto; (iii) such assignee confirms
that it has received a copy of this Agreement, together with copies of the
financial statements referred to in Section 4.01 and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon any Agent, such assigning Lender Party
or any other Lender Party and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement; (v) such assignee confirms
that it is an Eligible Assignee; (vi) such assignee appoints and authorizes each
Agent to take such action as agent on its behalf and to exercise such powers and
discretion under the Loan Documents as are delegated to such Agent by the terms
hereof and thereof, together with such powers and discretion as are reasonably
incidental thereto; and (vii) such assignee agrees that it will be bound by the
provisions of this Agreement and will perform in accordance with their terms all
of the obligations that by the terms of this Agreement are required to be
performed by it as a Lender or Issuing Bank, as the case may be.
(d) The Administrative Agent, acting for this purpose (but
only for this purpose) as the agent of the Borrower, shall maintain at its
address referred to in Section 8.02 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 Lender Parties and the Commitment under each Facility of,
and principal amount of the Advances owing under each Facility to, each Lender
Party 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 Agents and the Lender Parties shall treat each Person whose name
is recorded in the Register as a Lender Party hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrower or any
Agent or any Lender Party at any reasonable time and from time to time upon
reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender Party and an assignee, together with any Note or Notes
subject to such
128
128
assignment, the Administrative Agent shall, if such Assignment and Acceptance
has been completed and is in substantially the form of Exhibit C hereto (and is
accompanied by any required U.S. Internal Revenue Service Forms referred to in
Section 3(vii) thereof), (i) accept such Assignment and Acceptance, (ii) record
the information contained therein in the Register and (iii) give prompt notice
thereof to the Borrower and each other Agent. In the case of any assignment by a
Lender, within five Business Days after its receipt of such notice, the
Borrower, at its own expense, shall execute and deliver to the Administrative
Agent in exchange for the surrendered Note or Notes a new Note to the order of
such Eligible Assignee in an amount equal to the Commitment assumed by it under
each Facility pursuant to such Assignment and Acceptance and, if any assigning
Lender has retained a Commitment hereunder under such Facility, a new Note to
the order of such assigning Lender in an amount equal to the Commitment retained
by it hereunder. Such new Note or Notes shall be in an aggregate principal
amount equal to the aggregate principal amount of such surrendered Note or
Notes, shall be dated the Effective Date and shall otherwise be in substantially
the form of Exhibit X-0, X-0 or A-3 hereto, as the case may be.
(f) The Issuing Bank may assign to an Eligible Assignee all of
its rights and obligations under the undrawn portion of its Letter of Credit
Commitment at any time; provided, however, that the parties to each such
assignment shall execute and deliver to the Administrative Agent, for its
acceptance and recording in the Register, an Assignment and Acceptance, together
with a processing and recordation fee of $3,500.
(g) Each Lender Party may sell participations to one or more
Persons (other than any Loan Party or any of its Affiliates) in or to all or a
portion of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitments, the Advances owing to it and
the Note or Notes (if any) held by it); provided, however, that (i) such Lender
Party's obligations under this Agreement (including, without limitation, its
Commitments) shall remain unchanged, (ii) such Lender Party shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender Party shall remain the holder of any such Note for all
purposes of this Agreement, (iv) the Borrower, the Agents and the other Lender
Parties shall continue to deal solely and directly with such Lender Party in
connection with such Lender Party's rights and obligations under this Agreement
and (v) no participant under any such participation shall have any right to
approve any amendment or waiver of any provision of any Loan Document, or any
consent to any departure by any Loan Party therefrom, except to the extent that
such amendment, waiver or consent would reduce the principal of, or interest on,
the Notes or any fees or other amounts payable hereunder, in each case to the
extent subject to such participation, postpone any date fixed for any payment of
principal of, or interest on, the Notes or any fees or other amounts payable
hereunder, in each case to the extent subject to such participation, or release
all or substantially all of the Collateral.
129
129
(h) Any Lender Party that sells a participating interest under
Section 8.07(g) shall indemnify and hold harmless the Borrower and the
Administrative Agent from and against any taxes, related penalties and interest,
and reasonable out-of-pocket costs (including reasonable attorneys' fees and
expenses) incurred or payable by the Borrower or such Agent as a result of the
failure of Borrower or such Agent to comply with its obligations to deduct or
withhold any Taxes from any payments made pursuant to this Agreement to such
Lender Party (or such participant) or such Agent, as the case may be, which
taxes would not have been incurred or payable but for such participation.
(i) Any Lender Party may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.07, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Borrower furnished to such Lender
Party by or on behalf of the Borrower; provided, however, that, prior to any
such disclosure, the assignee or participant or proposed assignee or participant
shall agree to preserve the confidentiality of any Confidential Information
received by it from such Lender Party.
(j) Notwithstanding any other provision set forth in this
Agreement, any Lender Party may at any time create a security interest in all or
any portion of its rights under this Agreement (including, without limitation,
the Advances owing to it and the Note or Notes held by it) in favor of any
Federal Reserve Bank in accordance with Regulation A of the Board of Governors
of the Federal Reserve System.
SECTION 8.08. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of an original executed
counterpart of this Agreement.
SECTION 8.09. No Liability of the Issuing Bank. The Borrower
assumes all risks of the acts or omissions of any beneficiary or transferee of
any Letter of Credit with respect to its use of such Letter of Credit. Neither
the Issuing Bank nor any of its officers or directors shall be liable or
responsible for: (a) the use that may be made of any Letter of Credit or any
acts or omissions of any beneficiary or transferee in connection therewith; (b)
the validity, sufficiency or genuineness of documents, or of any endorsement
thereon, even if such documents should prove to be in any or all respects
invalid, insufficient, fraudulent or forged; (c) payment by the Issuing Bank
against presentation of documents that do not comply with the terms of a Letter
of Credit, including failure of any documents to bear any reference or adequate
reference to the Letter of Credit; or (d) any other circumstances whatsoever in
making or failing to make payment under any Letter of Credit, except that the
Borrower shall have a claim against the Issuing Bank, and Issuing Bank shall be
liable to the Borrower, to the extent of any direct, but
130
130
not consequential, damages suffered by the Borrower that the Borrower proves
were caused by (i) Issuing Bank's willful misconduct or gross negligence as
determined in a final, non-appealable judgment by a court of competent
jurisdiction in determining whether documents presented under any Letter of
Credit comply with the terms of the Letter of Credit or (ii) Issuing Bank's
willful failure to make lawful payment under a Letter of Credit after the
presentation to it of a draft and certificates strictly complying with the terms
and conditions of the Letter of Credit. In furtherance and not in limitation of
the foregoing, Issuing Bank may accept documents that appear on their face to be
in order, without responsibility for further investigation, regardless of any
notice or information to the contrary.
SECTION 8.10. Confidentiality. Neither any Agent nor any
Lender Party shall disclose any Confidential Information to any Person without
the consent of the Borrower, other than (a) to such Agent's or such Lender
Party's Affiliates and their officers, directors, employees, agents and advisors
and to actual or prospective Eligible Assignees and participants, and then only
on a confidential basis, (b) as required by any law, rule or regulation or
judicial process, (c) as requested or required by any state, Federal or foreign
authority or examiner regulating such Lender Party and (d) to any rating agency
when required by it, provided that, prior to any such disclosure, such rating
agency shall undertake to preserve the confidentiality of any Confidential
Information relating to the Loan Parties received by it from such Lender Party.
SECTION 8.11. Release of Collateral; Release of Subsidiary
Guarantor. Upon the sale, lease, transfer or other disposition of any item of
Collateral of any Loan Party (including, without limitation, as a result of the
sale, in accordance with the terms of the Loan Documents, of the Loan Party that
owns such Collateral) in accordance with the terms of the Loan Documents, the
Administrative Agent will (without the necessity of any notice to, or consent
of, any Lender), at the Borrower's expense, execute and deliver to such Loan
Party such documents as such Loan Party may reasonably request to evidence the
release of such item of Collateral from the assignment and security interest
granted under the Collateral Documents in accordance with the terms of the Loan
Documents. Upon the consummation of the sale, transfer or other disposition by
the Borrower and any of its Subsidiaries of all of the Equity Interests of the
Borrower and its Subsidiaries in any other Subsidiary which is a Subsidiary
Guarantor as permitted by, and in accordance with the terms of, the Loan
Documents, such Subsidiary Guarantor shall be automatically released from the
Subsidiary Guaranty and shall have no further obligations thereunder. Upon the
written request of the Borrower, together with a certificate detailing the
manner of any such sale of a Subsidiary Guarantor and the absence of any Default
hereunder both before and after giving effect thereto, the Administrative Agent
or the Required Lenders shall execute and deliver to the Borrower such documents
as the Borrower may reasonably request to evidence the release of such
Subsidiary Guarantor from the Subsidiary Guaranty.
SECTION 8.12. Jurisdiction, Etc. (a) Each of the parties
hereto hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive
131
131
jurisdiction of any New York State court or Federal court of the United States
of America sitting in New York City, and any appellate court from any thereof,
in any action or proceeding arising out of or relating to this Agreement or any
of the other Loan Documents to which it is a party, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in any such New York State court or, to
the fullest extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that any party may otherwise have to bring any action or proceeding
relating to this Agreement or any of the other Loan Documents in the courts of
any jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or any of the
other Loan Documents to which it is a party in any New York State or Federal
court. Each of the parties hereto hereby irrevocably waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to the maintenance
of such action or proceeding in any such court.
SECTION 8.13. Governing Law. This Agreement and the Notes
shall be governed by, and construed in accordance with, the laws of the State of
New York.
[The remainder of this page intentionally left blank.]
132
132
SECTION 8.14. Waiver of Jury Trial. Each of the Borrower, the
Agents and the Lender Parties irrevocably waives all right to trial by jury in
any action, proceeding or counterclaim (whether based on contract, tort or
otherwise) arising out of or relating to any of the Loan Documents, the
Advances, the Letters of Credit or the actions of any Agent or any Lender Party
in the negotiation, administration, performance or enforcement thereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
SOVEREIGN SPECIALTY CHEMICALS, INC.
By____________________________________________
Title:
XXXXXXX LYNCH, PIERCE,
XXXXXX & XXXXX
INCORPORATED, as Joint
Lead Arranger, Joint
Book Manager and
Syndication Agent
By____________________________________________
Title:
X.X. XXXXXX SECURITIES INC., as Joint
Lead Arranger, Joint Book Manager and
Documentation Agent
By____________________________________________
Title:
THE CHASE MANHATTAN BANK,
as Administrative Agent
By____________________________________________
Title:
133
133
INITIAL ISSUING BANK
THE CHASE MANHATTAN BANK
By____________________________________________
Title:
INITIAL LENDERS
XXXXXXX XXXXX CAPITAL CORPORATION
By____________________________________________
Title:
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK
By____________________________________________
Title:
THE CHASE MANHATTAN BANK
By____________________________________________
Title:
NATIONAL CITY BANK
By____________________________________________
Title:
134
SCHEDULE I
COMMITMENTS AND APPLICABLE LENDING OFFICES
TERM A TERM B REVOLVING CREDIT
NAME OF INITIAL LENDER COMMITMENT COMMITMENT COMMITMENT
------------------------------------------------------------------------------------------------
Xxxxxxx Xxxxx Capital $22,500,000.00 $37,500,000.00 $15,000,000.00
Corporation
------------------------------------------------------------------------------------------------
Xxxxxx Guaranty Trust $22,500,000.00 $37,500,000.00 $15,000,000.00
Company of New York
------------------------------------------------------------------------------------------------
The Chase Manhattan $15,000,000.00 $0.00 $10,000,000.00
Bank
------------------------------------------------------------------------------------------------
National City Bank $15,000,000.00 $0.00 $10,000,000.00
LETTER OF CREDIT DOMESTIC LENDING OFFICE EURODOLLAR
NAME OF INITIAL LENDER COMMITMENT LENDING OFFICE
-------------------------------------------------------------------------------------------------------------------------
Xxxxxxx Xxxxx Capital $0.00 Xxxxxxx Xxxxx & Co. Xxxxxxx Xxxxx & Co.
Corporation WFC North - 16th Floor WFC North - 00xx Xxxxx
000 Xxxxx Xxxxxx 000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Attn: Xxxxxxxx Xxxxxxxxx/ Attn: Xxxxxxxx Xxxxxxxxx/
Xxxx Xxxxxxxx Xxxx Xxxxxxxx
Tel: 000-000-0000/6996 Tel: 000-000-0000/6996
Fax: 000-000-0000 Fax: 000-000-0000
-------------------------------------------------------------------------------------------------------------------------
Xxxxxx Guaranty Trust $0.00 Xxxxxx Guaranty Trust Xxxxxx Guaranty Trust
Company of New York Company of New York Company of New York
c/o X.X. Xxxxxx Services, Inc. c/o X.X. Xxxxxx Services, Inc.
000 Xxxxxxx Xxxxxxxxxx Xxxx 000 Xxxxxxx Xxxxxxxxxx Xxxx
Xxxxxx, XX 00000 Xxxxxx, XX 00000
Attn: Xxxxxxxx Xxxxxxxxx Attn: Xxxxxxxx Xxxxxxxxx
Tel: 000-000-0000 Tel: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000
-------------------------------------------------------------------------------------------------------------------------
The Chase Manhattan $20,000,000.00 1 Chase Xxxxxxxxx Xxxxx 0 Xxxxx Xxxxxxxxx Plaza
Bank 0xx Xxxxx 0xx Xxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxxxx Attn: Xxxxx Xxxxxxxx
Tel: 000-000-0000 Tel: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000
-------------------------------------------------------------------------------------------------------------------------
National City Bank $0.00 National City Bank National City Bank
0000 Xxxx Xxxxx Xxxxxx 0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000 Xxxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxxxxx Attn: Xxxxxxx Xxxxxxxxxxx
Tel: 000-000-0000 Tel: 000-000-0000
135
TOTAL $75,000,000.00 $75,000,000.00 $50,000,000.00
Fax: 000-000-0000 Fax: 000-000-0000
TOTAL $20,000,000.00
136
SCHEDULE II
SUBSIDIARY GUARANTORS
1. SIA Adhesives, Inc., a Delaware corporation.
2. Xxxxxx & Xxxxxxx Corp., a New York corporation.
3. OSI Sealants, Inc., an Illinois corporation
4. Xxxxxx Chemicals, Inc., a New Hampshire corporation.
137
SCHEDULE III
EXISTING LETTERS OF CREDIT
L/C # ACCOUNT PARTY BENEFICIARY FACE AMOUNT ISSUE DATE TERMINATION DATE
----- ------------- ----------- ----------- ---------- ----------------
P-363456 SOVEREIGN SPECIALTY CHEMICALS RTC PROPERTIES 25000 U.S. 4/24/98 EVERGREEN
P-383505 SOVEREIGN SPECIALTY CHEMICALS CHASE MANHATTAN BANK SINGAPORE 2,000,000 SGD 5/30/97 EVERGREEN
138
SCHEDULE IV
DESIGNATED MATERIAL CONTRACTS
1. Patent License Agreement, dated as of July 1, 1991, by and between
Xxxxxx and Xxxxxxx Corporation and Xxxxxxxxx Xxxxx Seiyaku Co., LTD
2. Agreement of Intent, dated as of September 1, 1997, by and between the
Company and Xxxxxxxxx Xxxxx-Seiyaku Co.
3. Distributorship Agreement dated as of October 23, 1996 between Kohler
Co. and Darworth.
4. Exclusive Distributor Agreement dated as of July 29, 1998 (but
effective as of the close of business on July 31, 1998) by and between
ChemRex, Inc. and OSI Sealants, Inc.
5. License Agreement, dated July 29, 1998, between OSI ("Licensor") and
ChemRex, Inc. ("Licensee").
6. License Agreement, dated April 20, 1999, between Xxxxxx & Xxxxxxx
("Licensor") and Valspar Corporation ("Licensee").
139
EXHIBIT A-1
TO THE CREDIT AGREEMENT
FORM OF REVOLVING CREDIT NOTE
$_______________ Dated: December __, 1999
FOR VALUE RECEIVED, the undersigned, SOVEREIGN SPECIALTY CHEMICALS, INC.,
a Delaware corporation (the "BORROWER"), HEREBY PROMISES TO PAY
_________________________ or its registered assigns (the "LENDER") for the
account of its Applicable Lending Office (as defined in the Credit Agreement
referred to below) the aggregate principal amount of the Revolving Credit
Advances, the Letter of Credit Advances and the Swing Line Advances (each as
defined below) owing to the Lender by the Borrower pursuant to the Credit
Agreement dated as of December 29, 1999 (as amended, amended and restated,
supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT";
terms defined therein, unless otherwise defined herein, being used herein as
therein defined) among the Borrower, the Lender and certain other lender parties
party thereto, and The Chase Manhattan Bank, as Administrative Agent for the
Lender and such other lender parties on the Termination Date.
The Borrower promises to pay to the Lender interest on the
unpaid principal amount of each Revolving Credit Advance, Letter of Credit
Advance and Swing Line Advance from the date of such Revolving Credit Advance,
Letter of Credit Advance or Swing Line Advance, as the case may be, until such
principal amount is paid in full, at such interest rates, and payable at such
times, as are specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the
United States of America to the Administrative Agent at the Administrative
Agent's Account in same day funds. Each Revolving Credit Advance, Letter of
Credit Advance and Swing Line Advance owing to the Lender by the Borrower and
the maturity thereof, and all payments made on account of principal thereof,
shall be recorded by the Lender and, prior to any transfer hereof, endorsed on
the grid attached hereto, which is part of this Promissory Note; provided,
however, that the failure of the Lender to make any such recordation or
endorsement shall not affect the Obligations of the Borrower under this
Promissory Note.
This Promissory Note is one of the Revolving Credit Notes
referred to in, and is entitled to the benefits of, the Credit Agreement. The
Credit Agreement, among other things, (i) provides for the making of advances
(variously, the "REVOLVING CREDIT ADVANCES", the "LETTER OF CREDIT ADVANCES" or
the "SWING LINE ADVANCES") by the Lender to or for the benefit of the
140
2
Borrower from time to time in an aggregate amount not to exceed at any time
outstanding the U.S. dollar amount first above mentioned, the indebtedness of
the Borrower resulting from each such Revolving Credit Advance, Letter of Credit
Advance and Swing Line Advance being evidenced by this Promissory Note, and (ii)
contains provisions for acceleration of the maturity hereof upon the happening
of certain stated events and also for prepayments on account of principal hereof
prior to the maturity hereof upon the terms and conditions therein specified.
The obligations of the Borrower under this Promissory Note and the other Loan
Documents, and the obligations of the other Loan Parties under the Loan
Documents, are secured by the Collateral as provided in the Loan Documents.
This Promissory Note and the obligations evidenced hereby may
not be transferred or assigned in whole or in part, except pursuant to and in
accordance with the provisions of Section 8.07 of the Credit Agreement,
including, without limitation, the requirement that the Administrative Agent
shall have accepted and recorded each such transfer or assignment in the
Register.
SOVEREIGN SPECIALTY CHEMICALS, INC.
By_________________________________
Title:
141
ADVANCES AND PAYMENTS OF PRINCIPAL
AMOUNT OF UNPAID
AMOUNT OF PRINCIPAL PAID PRINCIPAL NOTATION
DATE ADVANCE OR PREPAID BALANCE MADE BY
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
142
EXHIBIT A-2
TO THE CREDIT AGREEMENT
FORM OF TERM A NOTE
$_______________ Dated: December __, 1999
FOR VALUE RECEIVED, the undersigned, SOVEREIGN SPECIALTY
CHEMICALS, INC., a Delaware corporation (the "BORROWER"), HEREBY PROMISES TO PAY
_________________________ or its registered assigns (the "LENDER") for the
account of its Applicable Lending Office (as defined in the Credit Agreement
referred to below) the aggregate principal amount of the Term A Advances (as
defined below) owing to the Lender by the Borrower pursuant to the Credit
Agreement dated as of December 29, 1999 (as amended, amended and restated,
supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT";
terms defined therein, unless otherwise defined herein, being used herein as
therein defined) among the Borrower, the Lender and certain other lender parties
party thereto, and The Chase Manhattan Bank, as Administrative Agent for the
Lender and such other lender parties on the dates and in the amounts specified
in the Credit Agreement.
The Borrower promises to pay to the Lender interest on the
unpaid principal amount of each Term A Advance from the date of such Term A
Advance until such principal amount is paid in full, at such interest rates, and
payable at such times, as are specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the
United States of America to the Administrative Agent, at the Administrative
Agent's Account in same day funds. The Term A Advances owing to the Lender by
the Borrower and the maturity thereof, and all payments made on account of
principal thereof, shall be recorded by the Lender and, prior to any transfer
hereof, endorsed on the grid attached hereto, which is part of this Promissory
Note; provided, however, that the failure of the Lender to make any such
recordation or endorsement shall not affect the Obligations of the Borrower
under this Promissory Note.
This Promissory Note is one of the Term A Notes referred to
in, and is entitled to the benefits of, the Credit Agreement. The Credit
Agreement, among other things, (i) provides for the making of Term A Advances by
the Lender to the Borrower in an aggregate amount not to exceed the U.S. dollar
amount first above mentioned, the indebtedness of the Borrower resulting from
such Term A Advances being evidenced by this Promissory Note, and (ii) contains
provisions for acceleration of the maturity hereof upon the happening of certain
stated events and also for prepayments on account of principal hereof prior to
the maturity hereof
143
2
upon the terms and conditions therein specified. The obligations of the Borrower
under this Promissory Note and the other Loan Documents, and the obligations of
the other Loan Parties under the Loan Documents, are secured by the Collateral
as provided in the Loan Documents.
This Promissory Note and the obligations evidenced hereby may
not be transferred or assigned in whole or in part, except pursuant to and in
accordance with the provisions of Section 8.07 of the Credit Agreement,
including, without limitation, the requirement that the Administrative Agent
shall have accepted and recorded each such transfer or assignment in the
Register.
SOVEREIGN SPECIALTY CHEMICALS, INC.
By_________________________________
Title:
144
ADVANCES AND PAYMENTS OF PRINCIPAL
AMOUNT OF UNPAID
AMOUNT OF PRINCIPAL PAID PRINCIPAL NOTATION
DATE ADVANCE OR PREPAID BALANCE MADE BY
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
145
EXHIBIT A-3
TO THE CREDIT AGREEMENT
FORM OF TERM B NOTE
$_______________ Dated: December __, 1999
FOR VALUE RECEIVED, the undersigned, SOVEREIGN SPECIALTY
CHEMICALS, INC., a Delaware corporation (the "BORROWER"), HEREBY PROMISES TO PAY
_________________________ or its registered assigns (the "LENDER") for the
account of its Applicable Lending Office (as defined in the Credit Agreement
referred to below) the aggregate principal amount of the Term B Advances (as
defined below) owing to the Lender by the Borrower pursuant to the Credit
Agreement dated as of December 29, 1999 (as amended, amended and restated,
supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT";
terms defined therein, unless otherwise defined herein, being used herein as
therein defined) among the Borrower, the Lender and certain other lender parties
party thereto, and The Chase Manhattan Bank, as Administrative Agent for the
Lender and such other lender parties on the dates and in the amounts specified
in the Credit Agreement.
The Borrower promises to pay to the Lender interest on the
unpaid principal amount of each Term B Advance from the date of such Term B
Advance until such principal amount is paid in full, at such interest rates, and
payable at such times, as are specified in the Credit Agreement.
Both principal and interest are payable in lawful money of the
United States of America to the Administrative Agent, at the Administrative
Agent's Account in same day funds. The Term B Advances owing to the Lender by
the Borrower and the maturity thereof, and all payments made on account of
principal thereof, shall be recorded by the Lender and, prior to any transfer
hereof, endorsed on the grid attached hereto, which is part of this Promissory
Note; provided, however, that the failure of the Lender to make any such
recordation or endorsement shall not affect the Obligations of the Borrower
under this Promissory Note.
This Promissory Note is one of the Term B Notes referred to
in, and is entitled to the benefits of, the Credit Agreement. The Credit
Agreement, among other things, (i) provides for the making Term B Advances by
the Lender to the Borrower in an aggregate amount not to exceed the U.S. dollar
amount first above mentioned, the indebtedness of the Borrower resulting from
such Term B Advances being evidenced by this Promissory Note, and (ii) contains
provisions for acceleration of the maturity hereof upon the happening of certain
stated events and also for prepayments on account of principal hereof prior to
the maturity hereof upon the terms
146
2
and conditions therein specified. The obligations of the Borrower under this
Promissory Note and the other Loan Documents, and the obligations of the other
Loan Parties under the Loan Documents, are secured by the Collateral as provided
in the Loan Documents.
This Promissory Note and the obligations evidenced hereby may
not be transferred or assigned in whole or in part, except pursuant to and in
accordance with the provisions of Section 8.07 of the Credit Agreement,
including, without limitation, the requirement that the Administrative Agent
shall have accepted and recorded each such transfer or assignment in the
Register.
SOVEREIGN SPECIALTY CHEMICALS, INC.
By_________________________________
Title:
147
ADVANCES AND PAYMENTS OF PRINCIPAL
AMOUNT OF UNPAID
AMOUNT OF PRINCIPAL PAID PRINCIPAL NOTATION
DATE ADVANCE OR PREPAID BALANCE MADE BY
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
================== ======================== ======================== ========================= ========================
148
EXHIBIT B
TO THE CREDIT AGREEMENT
FORM OF NOTICE OF BORROWING
[Date]
The Chase Manhattan Bank,
as Administrative Agent
under the Credit Agreement
referred to below
The Loan and Agency Services Group
0 Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attention: _______________
Ladies and Gentlemen:
The undersigned, Sovereign Specialty Chemicals, Inc., refers
to the Credit Agreement dated as of December 29, 1999 (as amended, amended and
restated, supplemented or otherwise modified from time to time, the "CREDIT
AGREEMENT"; the terms defined therein being used herein as therein defined),
among the undersigned, the Lender Parties party thereto, and The Chase Manhattan
Bank, as Administrative Agent for the Lender Parties, and hereby gives you
notice, irrevocably, pursuant to Section 2.02 of the Credit Agreement that the
undersigned hereby requests a Borrowing under the Credit Agreement, and in that
connection sets forth below the information relating to such Borrowing (the
"PROPOSED BORROWING") as required by Section 2.02(a) of the Credit Agreement:
(i) The Business Day of the Proposed Borrowing is
_________ __, ____.
(ii) The Facility under which the Proposed Borrowing is
requested is the _______________ Facility.
(iii) The Type of Advances comprising the Proposed Borrowing
is [Base Rate Advances] [Eurodollar Rate Advances].
(iv) The aggregate amount of the Proposed Borrowing is
$__________.
149
[(v) The initial Interest Period for each Eurodollar Rate
Advance made as part of the Proposed Borrowing is __________ month[s].]
(vi) [No portion of the Proposed Borrowing shall be used
to pay the purchase price of a Permitted Acquisition.] [Set forth on
Annex I hereto is a detail of the consideration proposed to be paid for
a Permitted Acquisition (a portion of which consideration is
constituted by a portion of the Proposed Borrowing).]
The undersigned hereby certifies that the following statements
are true on the date hereof, and will be true on the date of the
Proposed Borrowing:
(A) The representations and warranties contained in each Loan
Document are correct on and as of the date of the Proposed Borrowing,
before and after giving effect to the Proposed Borrowing and to the
application of the proceeds therefrom, as though made on and as of such
date, other than any such representations or warranties that, by their
terms, refer to a specific date other than the date of the Proposed
Borrowing, in which case, as of such specific date.
(B) No Default has occurred and is continuing, or would result
from such Proposed Borrowing or from the application of the proceeds
therefrom.
Delivery of an executed counterpart of this Notice of
Borrowing by telecopier shall be effective as delivery of an original executed
counterpart of this Notice of Borrowing.
Very truly yours,
SOVEREIGN SPECIALTY CHEMICALS, INC.
By_________________________________
Title:
150
ANNEX I
TO THE NOTICE OF BORROWING
[NAME OF PERMITTED ACQUISITION]
A. Purchase Price: $_________
which shall be constituted by:
Cash from the Proposed Borrowing $___________
Cash from other Sources $___________
Cash Equivalents totaling: $___________
B. Cash Equivalents referred to above:
151
EXHIBIT C
TO THE CREDIT AGREEMENT
FORM OF ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement dated as of December
29, 1999 (as amended, amended and restated, supplemented or otherwise modified
from time to time, the "CREDIT AGREEMENT"; the terms defined therein, unless
otherwise defined herein, being used herein as therein defined) among Sovereign
Specialty Chemicals, Inc., a Delaware corporation (the "BORROWER"), the Lender
Parties party thereto, and The Chase Manhattan Bank, as Administrative Agent for
the Lender Parties.
Each "Assignor" referred to on Schedule 1 hereto (each, an
"ASSIGNOR") and each "Assignee" referred to on Schedule 1 hereto (each, an
"ASSIGNEE") agrees severally with respect to all information relating to it and
its assignment hereunder and on Schedule 1 hereto as follows:
1. Such Assignor hereby sells and assigns, without recourse
except as to the representations and warranties made by it herein, to such
Assignee, and such Assignee hereby purchases and assumes from such Assignor, an
interest in and to such Assignor's rights and obligations under the Credit
Agreement as of the date hereof equal to the percentage interest specified on
Schedule 1 hereto of all outstanding rights and obligations under the Facility
or Facilities specified on Schedule 1 hereto. After giving effect to such sale
and assignment, such Assignee's Commitments and the amount of the Advances owing
to such Assignee will be as set forth on Schedule 1 hereto.
2. Such Assignor (i) represents and warrants that its name set
forth on Schedule 1 hereto is its legal name, that it is the legal and
beneficial owner of the interest or interests being assigned by it hereunder and
that such interest or interests are free and clear of any adverse claim; (ii)
makes no representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in connection with
any Loan Document or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of, or the perfection or priority of any lien
or security interest created or purported to be created under or in connection
with, any Loan Document or any other instrument or document furnished pursuant
thereto; (iii) makes no representation or warranty and assumes no responsibility
with respect to the financial condition of any Loan Party or the performance or
observance by any Loan Party of any of its obligations under any Loan Document
or any other instrument or document furnished pursuant thereto; and (iv)
attaches the Note or Notes held by such Assignor and requests that the
Administrative Agent exchange such Note or Notes for a new Note or Notes payable
to the order of such Assignee in an amount equal to the Commitments assumed by
such Assignee pursuant hereto or new Notes payable to the order of such Assignee
in an amount equal to the Commitments assumed by such Assignee pursuant hereto
and such Assignor in an amount equal to the Commitments retained by such
Assignor under the Credit Agreement, respectively, as specified on Schedule 1
hereto.
152
3. Such Assignee (i) confirms that it has received a copy of
the Credit Agreement, together with copies of the financial statements referred
to in Section 4.01 thereof and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Acceptance; (ii) agrees that it will, independently and
without reliance upon any Agent, any Assignor or any other Lender Party and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Credit Agreement; (iii) represents and warrants that its name set
forth on Schedule 1 hereto is its legal name; (iv) confirms that it is an
Eligible Assignee; (v) appoints and authorizes each Agent to take such action as
agent on its behalf and to exercise such powers and discretion under the Loan
Documents as are delegated to such Agent by the terms thereof, together with
such powers and discretion as are reasonably incidental thereto; (vi) agrees
that it will be bound by the provisions of the Credit Agreement and will perform
in accordance with their terms all of the obligations that by the terms of the
Credit Agreement are required to be performed by it as a Lender Party; and (vii)
attaches any U.S. Internal Revenue Service or other forms required under Section
2.12 of the Credit Agreement.
4. Following the execution of this Assignment and Acceptance,
it will be delivered to the Administrative Agent for acceptance and recording by
the Administrative Agent. The effective date for this Assignment and Acceptance
(the "EFFECTIVE DATE") shall be the date of acceptance hereof by the
Administrative Agent, unless otherwise specified on Schedule 1 hereto.
5. Upon such acceptance and recording by the Administrative
Agent, as of the Effective Date, (i) such Assignee shall be a party to the
Credit Agreement and, to the extent provided in this Assignment and Acceptance,
have the rights and obligations of a Lender Party thereunder and (ii) such
Assignor shall, to the extent provided in this Assignment and Acceptance,
relinquish its rights and be released from its obligations under the Credit
Agreement (other than its rights and obligations under the Loan Documents that
are specified under the terms of such Loan Documents to survive the payment in
full of the Obligations of the Loan Parties under the Loan Documents to the
extent any claim thereunder relates to an event arising prior to the Effective
Date of this Assignment and Acceptance) and, if this Assignment and Acceptance
covers all of the remaining portion of the rights and obligations of such
Assignor under the Credit Agreement, such Assignor shall cease to be a party
thereto.
6. Upon such acceptance and recording by the Administrative
Agent, from and after the Effective Date, the Administrative Agent shall make
all payments under the Credit Agreement and the Notes in respect of the interest
assigned hereby (including, without limitation, all payments of principal,
interest and commitment fees with respect thereto) to such Assignee. Such
Assignor and such Assignee shall make all appropriate adjustments in payments
under the Credit Agreement and the Notes for periods prior to the Effective Date
directly between themselves.
7. This Assignment and Acceptance shall be governed by, and
construed in accordance with, the laws of the State of New York.
153
8. This Assignment and Acceptance may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of Schedule 1 to this Assignment and Acceptance by
telecopier shall be effective as delivery of an original executed counterpart of
this Assignment and Acceptance.
IN WITNESS WHEREOF, each Assignor and each Assignee have
caused Schedule 1 to this Assignment and Acceptance to be executed by their
officers thereunto duly authorized as of the date specified thereon.
154
SCHEDULE 1
TO
ASSIGNMENT AND ACCEPTANCE
ASSIGNORS:
========================================================= =========== =========== ============= =========== ============
REVOLVING CREDIT FACILITY
========================================================= =========== =========== ============= =========== ============
Percentage interest assigned % % % % %
========================================================= =========== =========== ============= =========== ============
Revolving Credit Commitment assigned $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
Aggregate outstanding principal amount of
Revolving Credit Advances assigned $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
Principal amount of Revolving Credit Note
payable to ASSIGNOR (after assignment) $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
TERM A FACILITY
========================================================= =========== =========== ============= =========== ============
Percentage interest assigned % % % % %
========================================================= =========== =========== ============= =========== ============
Term A Commitment assigned $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
Outstanding principal amount of
Term A Advance assigned $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
Principal amount of Term A Note
payable to ASSIGNOR (after assignment) $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
TERM B FACILITY
========================================================= =========== =========== ============= =========== ============
Percentage interest assigned % % % % %
========================================================= =========== =========== ============= =========== ============
Term B Commitment assigned $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
Outstanding principal amount of
Term B Advance assigned $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
Principal amount of Term B Note
payable to ASSIGNOR (after assignment) $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
LETTER OF CREDIT FACILITY
========================================================= =========== =========== ============= =========== ============
Letter of Credit Commitment assigned $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
Letter of Credit Commitment retained $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
155
ASSIGNEES:
========================================================= =========== =========== ============= =========== ============
REVOLVING CREDIT FACILITY
========================================================= =========== =========== ============= =========== ============
Percentage interest assumed % % % % %
========================================================= =========== =========== ============= =========== ============
Revolving Credit Commitment assumed $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
Aggregate outstanding principal amount of
Revolving Credit Advances assumed $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
Principal amount of Revolving Credit Note
payable to ASSIGNEE (after assignment) $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
TERM A FACILITY
========================================================= =========== =========== ============= =========== ============
Percentage interest assumed % % % % %
========================================================= =========== =========== ============= =========== ============
Term A Commitment assumed $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
Outstanding principal amount of
Term A Advance assumed $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
Principal amount of Term A Note
payable to ASSIGNEE (after assignment) $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
TERM B FACILITY
========================================================= =========== =========== ============= =========== ============
Percentage interest assumed % % % % %
========================================================= =========== =========== ============= =========== ============
Term B Commitment assumed $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
Outstanding principal amount of
Term B Advance assumed $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
Principal amount of Term B Note
payable to ASSIGNEE (after assignment) $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
LETTER OF CREDIT FACILITY
========================================================= =========== =========== ============= =========== ============
Letter of Credit Commitment assumed $ $ $ $ $
========================================================= =========== =========== ============= =========== ============
156
2
Effective Date (if other than date of acceptance by Administrative Agent):
(1)_________ __, ____
ASSIGNORS
____________________________________, as Assignor
[Type or print legal name of Assignor]
By_______________________________________________
Title:
Dated: _________ __, ____
____________________________________, as Assignor
[Type or print legal name of Assignor]
By_______________________________________________
Title:
Dated: _________ __, ____
____________________________________, as Assignor
[Type or print legal name of Assignor]
By_______________________________________________
Title:
__________
(1) This date should be no earlier than five Business Days after the
delivery of this Assignment and Acceptance to the Administrative Agent.
157
3
Dated: _________ __, ____
____________________________________, as Assignor
[Type or print legal name of Assignor]
By_______________________________________________
Title:
Dated: _________ __, ____
____________________________________, as Assignor
[Type or print legal name of Assignor]
By_______________________________________________
Title:
Dated: _________ __, ____
ASSIGNEES
____________________________________, as Assignee
[Type or print legal name of Assignee]
By_______________________________________________
Title:
Dated: _________ __, ____
Domestic Lending Office:
Eurodollar Lending Office:
____________________________________, as Assignee
158
4
[Type or print legal name of Assignee]
By_______________________________________________
Title:
Dated: _________ __, ____
Domestic Lending Office:
Eurodollar Lending Office:
____________________________________, as Assignee
[Type or print legal name of Assignee]
By_______________________________________________
Title:
Dated: _________ __, ____
Domestic Lending Office:
Eurodollar Lending Office:
____________________________________, as Assignee
[Type or print legal name of Assignee]
By_______________________________________________
Title:
Dated: _________ __, ____
Domestic Lending Office:
Eurodollar Lending Office:
159
5
____________________________________, as Assignee
[Type or print legal name of Assignee]
By_______________________________________________
Title:
Dated: _________ __, ____
Domestic Lending Office:
Eurodollar Lending Office:
Accepted (2)[and Approved] this ____
day of ___________, ____
[NAME OF Administrative Agent],
as Administrative Agent
By______________________________________
Title:
(3)[Approved this ____ day
of _____________, ____
SOVEREIGN SPECIALTY CHEMICALS, INC.
By______________________________________
_________
(2) Required if the Assignee is an Eligible Assignee solely by reason of
clause(a) (viii) or (b) of the definition of "ELIGIBLE ASSIGNEE".
(3) See footnote 2 above.
160
EXECUTION COPY
$200,000,000
CREDIT AGREEMENT
Dated as of December 29, 1999
Among
SOVEREIGN SPECIALTY CHEMICALS, INC.
as Borrower
and
THE INITIAL LENDERS, INITIAL ISSUING BANK AND
SWING LINE BANK NAMED HEREIN
as Initial Lenders, Initial Issuing Bank and Swing Line Bank
and
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
as Joint Lead Arranger, Joint Book-Running Manager and Syndication Agent
and
X.X. XXXXXX SECURITIES INC.
as Joint Lead Arranger, Joint Book-Running Manager and Documentation Agent
and
THE CHASE MANHATTAN BANK
as Administrative Agent
161
T A B L E O F C O N T E N T S
SECTION PAGE
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
1.01. Certain Defined Terms......................................... 2
1.02. Computation of Time Periods; Other Definitional Provisions.... 37
1.03. Accounting Terms.............................................. 37
ARTICLE II AMOUNTS AND TERMS OF THE ADVANCES
AND THE LETTERS OF CREDIT
2.01. Advances and Letters of Credit................................ 38
2.02. Making the Advances........................................... 40
2.03. Issuance of and Drawings and Reimbursement Under Letters of
Credit........................................................ 43
2.04. Repayment of Advances......................................... 44
2.05. Termination or Reduction of the Commitments................... 48
2.06. Prepayments................................................... 49
2.07. Interest...................................................... 53
2.08. Fees.......................................................... 54
2.09. Conversion of Advances........................................ 55
2.10. Increased Costs, Etc.......................................... 56
2.11. Payments and Computations..................................... 57
2.12. Taxes......................................................... 59
2.13. Sharing of Payments, Etc...................................... 62
2.14. Use of Proceeds............................................... 63
2.15. Defaulting Lenders............................................ 63
ARTICLE III CONDITIONS OF LENDING AND ISSUANCES
OF LETTERS OF CREDIT
3.01. Conditions Precedent to Initial Extension of Credit........... 66
3.02. Conditions Precedent to Each Borrowing and Issuance andRenewal 71
3.03. Determinations Under Section 3.01............................. 72
ARTICLE IV REPRESENTATIONS AND WARRANTIES
4.01. Representations and Warranties of the Borrower................ 72
ARTICLE V COVENANTS OF THE BORROWER
5.01. Affirmative Covenants......................................... 81
5.02. Negative Covenants............................................ 91
5.03. Reporting Requirements........................................ 103
5.04. Financial Covenants........................................... 107
162
ARTICLE VI EVENTS OF DEFAULT
6.01. Events of Default............................................. 109
6.02. Actions in Respect of the Letters of Credit upon Default...... 113
ARTICLE VII THE AGENTS
7.01. Authorization and Action...................................... 113
7.02. Agents' Reliance, Etc......................................... 114
7.03. Chase, X.X. Xxxxxx, ML&Co. and Affiliates..................... 114
7.04. Lender Party Credit Decision.................................. 114
7.05. Indemnification............................................... 115
7.06. Successor Agents.............................................. 116
ARTICLE VIII MISCELLANEOUS
8.01. Amendments, Etc............................................... 117
8.02. Notices, Etc.................................................. 120
8.03. No Waiver; Remedies........................................... 120
8.04. Costs and Expenses............................................ 120
8.05. Right of Set-off.............................................. 122
8.06. Binding Effect................................................ 123
8.07. Assignments and Participations................................ 123
8.08. Execution in Counterparts..................................... 126
8.09. No Liability of the Issuing Bank.............................. 126
8.10. Confidentiality............................................... 127
8.11. Release of Collateral; Release of Subsidiary Guarantor........ 127
8.12. Jurisdiction, Etc............................................. 128
8.13. Governing Law................................................. 128
8.14. Waiver of Jury Trial.......................................... 129
163
iii
SECTION PAGE
SCHEDULES
Schedule I - Commitments and Applicable Lending Offices
Schedule II - Subsidiary Guarantors
Schedule III - Existing Letters of Credit
Schedule IV - Designated Material Contracts
Schedule 4.01(a) - Holders of Borrower Equity Interests
Schedule 4.01(b) - Subsidiaries
Schedule 4.01(c) - Consents
Schedule 4.01(d) - Authorizations, Approvals, Actions, Notices and
Filings
Schedule 4.01(f) - Disclosed Litigation
Schedule 4.01(p) - Plans, Multiemployer Plans and Welfare Plans
Schedule 4.01(q) - Environmental Compliance
Schedule 4.01(r) - Open Years; Unpaid Tax Liabilities; Adjusted Tax Bases
Schedule 4.01(t) - Existing Debt
Schedule 4.01(u) - Surviving Debt
Schedule 4.01(v) - Liens
Schedule 4.01(w) - Owned Real Property
Schedule 4.01(x) - Leased Real Property
Schedule 4.01(y) - Investments
Schedule 4.01(z) - Intellectual Property
Schedule 4.01(aa) - Material Contracts
EXHIBITS
Exhibit A-1 - Form of Revolving Credit Note
Exhibit A-2 - Form of Term A Note
Exhibit A-3 - Form of Term B Note
Exhibit B - Form of Notice of Borrowing
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Security Agreement
Exhibit E - Form of Subsidiary Guaranty
164
iv
Exhibit F - Form of Solvency Certificate
Exhibit G - Form of Opinion of Counsel to the Loan Parties
Exhibit H - Form of Certificate of Non-Bank Status
Exhibit I - Form of Intercompany Note
