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EXHIBIT(b)(4)
REVOLVING CREDIT
AND
TERM LOAN AGREEMENT
Dated as of July 17, 2001
among
IL FORNAIO (AMERICA) CORPORATION
THE LENDERS LISTED ON SCHEDULE I HERETO
and
FLEET NATIONAL BANK, as Administrative Agent
with
IBJ WHITEHALL BANK & TRUST COMPANY, as Syndication Agent
FLEET SECURITIES, INC., as Arranger
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TABLE OF CONTENTS
1. DEFINITIONS AND RULES OF INTERPRETATION ............................................ 1
1.1. Definitions .............................................................. 1
1.2. Rules of Interpretation .................................................. 22
2. THE REVOLVING CREDIT FACILITY ...................................................... 23
2.1. Commitment to Lend ....................................................... 23
2.2. Commitment Fee ........................................................... 23
2.3. Reduction of Total Commitment ............................................ 23
2.4. The Revolving Credit Notes ............................................... 24
2.5. Interest on Revolving Credit Loans ....................................... 24
2.6. Requests for Revolving Credit Loans ...................................... 24
2.7. Conversion Options ....................................................... 25
2.7.1. Conversion to Different Type of Revolving Credit Loan ........... 25
2.7.2. Continuation of Type of Revolving Credit Loan ................... 25
2.7.3. Eurodollar Rate Loans ........................................... 26
2.8. Funds for Revolving Credit Loan .......................................... 26
2.8.1. Funding Procedures .............................................. 26
2.8.2. Advances by Administrative Agent ................................ 26
3. REPAYMENT OF THE REVOLVING CREDIT LOANS ............................................ 27
3.1. Maturity ................................................................. 27
3.2. Mandatory Repayments of Revolving Credit Loans ........................... 27
3.3. Optional Repayments of Revolving Credit Loans ............................ 27
4. THE TERM LOAN ...................................................................... 28
4.1. Commitment to Lend ....................................................... 28
4.2. The Term Notes ........................................................... 28
4.3. Mandatory Prepayment of Term Loans ....................................... 28
4.3.1. Schedule of Installment Payments of Principal of Term Loan ...... 28
4.3.2. Excess Cash Flow Recapture ...................................... 29
4.3.3. Proceeds of Certain Events ...................................... 30
4.3.4. Application of Payments ......................................... 30
4.4. Optional Prepayment of Term Loan ......................................... 31
4.5. Interest on Term Loan .................................................... 31
4.5.1. Interest Rates .................................................. 31
4.5.2. Notification by Borrower ........................................ 31
4.5.3. Amounts, etc .................................................... 32
5. LETTERS OF CREDIT .................................................................. 32
5.1. Letter of Credit Commitments ............................................. 32
5.1.1. Commitment to Issue Letters of Credit ........................... 32
5.1.2. Letter of Credit Applications ................................... 32
5.1.3. Terms of Letters of Credit ...................................... 33
5.1.4. Reimbursement Obligations of Lenders ............................ 33
5.1.5. Participations of Lenders ....................................... 33
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5.2. Reimbursement Obligation of the Borrower ................................. 33
5.3. Letter of Credit Payments ................................................ 34
5.4. Obligations Absolute ..................................................... 35
5.5. Reliance by Issuer ....................................................... 35
5.6. Letter of Credit Fee ..................................................... 36
6. CERTAIN GENERAL PROVISIONS ......................................................... 36
6.1. Fees ..................................................................... 36
6.2. Funds for Payments ....................................................... 36
6.2.1. Payments to Administrative Agent ................................ 36
6.2.2. No Offset, etc .................................................. 36
6.3. Computations ............................................................. 38
6.4. Inability to Determine Eurodollar Rate ................................... 39
6.5. Illegality ............................................................... 39
6.6. Additional Costs, etc .................................................... 39
6.7. Capital Adequacy. (a) ................................................... 41
6.8. Certificate .............................................................. 42
6.9. Indemnity ................................................................ 42
6.10. Interest After Default ................................................... 43
6.10.1. Overdue Amounts ................................................ 43
6.10.2. Amounts Not Overdue ............................................ 43
7. COLLATERAL SECURITY ................................................................ 43
8. REPRESENTATIONS AND WARRANTIES ..................................................... 43
8.1. Corporate Authority ...................................................... 43
8.1.1. Incorporation; Good Standing .................................... 43
8.1.2. Authorization ................................................... 44
8.1.3. Enforceability .................................................. 44
8.2. Governmental Approvals ................................................... 44
8.3. Title to Properties; Leases .............................................. 44
8.4. Financial Statements and Projections ..................................... 45
8.4.1. Fiscal Year ..................................................... 45
8.4.2. Financial Statements ............................................ 45
8.4.3. Pro Forma Balance Sheet Date Projections ........................ 45
8.5. No Material Adverse Changes, etc ......................................... 46
8.6. Laws, Licenses; Franchises, Patents, Copyrights, etc ..................... 46
8.6.1. Laws, Licenses .................................................. 46
8.6.2. Franchises, Patents, Copyrights, etc ............................ 46
8.7. Litigation ............................................................... 47
8.8. No Materially Adverse Contracts, etc ..................................... 47
8.9. Compliance with Other Instruments, Laws, etc ............................. 47
8.10. Tax Status .............................................................. 47
8.11. No Event of Default ..................................................... 47
8.12. Holding Company and Investment Company Acts ............................. 48
8.13. Absence of Financing Statements, etc .................................... 48
8.14. Perfection of Security Interests ........................................ 48
8.15. Certain Transactions .................................................... 48
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8.16. Employee Benefit Plans ................................................... 48
8.16.1. In General ..................................................... 48
8.16.2. Terminability of Welfare Plans ................................. 49
8.16.3. Guaranteed Pension Plans ....................................... 49
8.16.4. Multiemployer Plans ............................................ 49
8.17. Use of Proceeds .......................................................... 50
8.17.1. General ........................................................ 50
8.17.2. Regulations U and X ............................................ 50
8.17.3. Ineligible Securities .......................................... 50
8.18. Environmental Compliance ................................................. 50
8.19. Subsidiaries, etc ........................................................ 52
8.20. Disclosure ............................................................... 52
8.21. Merger Documents; Subordinated Loan Documents; Equity Documents .......... 52
8.22. Solvency ................................................................. 53
8.23. Bank Accounts ............................................................ 54
8.24. Stores ................................................................... 54
8.25. Leases ................................................................... 54
9. AFFIRMATIVE COVENANTS .............................................................. 54
9.1. Punctual Payment ......................................................... 54
9.2. Maintenance of Office .................................................... 54
9.3. Records and Accounts ..................................................... 55
9.4. Financial Statements, Certificates and Information ....................... 55
9.5. Notices .................................................................. 57
9.5.1. Defaults ........................................................ 57
9.5.2. Environmental Events ............................................ 57
9.5.3. Notification of Claim against Collateral ........................ 57
9.5.4. Notice of Litigation and Judgments .............................. 57
9.5.5. Notice of Bank Accounts ......................................... 58
9.6. Legal Existence; Maintenance of Properties ............................... 58
9.7. Insurance ................................................................ 58
9.7.1. Required Insurance .............................................. 58
9.7.2. Insurance Proceeds .............................................. 59
9.7.3. Notice of Cancellation .......................................... 59
9.8. Taxes .................................................................... 60
9.9. Inspection of Properties and Books, etc .................................. 60
9.9.1. General ......................................................... 60
9.9.2. Appraisals ...................................................... 60
9.9.3. Environmental Assessments ....................................... 60
9.9.4. Communications with Accountants ................................. 61
9.10. Compliance with Laws, Contracts, Licenses, and Permits ................... 61
9.11. Employee Benefit Plans ................................................... 62
9.12. Use of Proceeds .......................................................... 62
9.13. Conduct of Business; Stores .............................................. 62
9.14. Interest Rate Protection ................................................. 62
9.15. Bank Accounts ............................................................ 62
9.16. New Subsidiaries ......................................................... 63
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9.17. Replacement Instruments ................................................. 64
9.18. Further Assurances ...................................................... 64
10. CERTAIN NEGATIVE COVENANTS ........................................................ 64
10.1. Restrictions on Indebtedness ............................................ 64
10.2. Restrictions on Liens ................................................... 65
10.3. Restrictions on Investments ............................................. 67
10.4. Restricted Payments ..................................................... 68
10.5. Merger, Consolidation and Disposition of Assets ......................... 69
10.5.1. Mergers and Consolidations .................................... 69
10.5.2. Dispositions of Assets ........................................ 69
10.5.3. Acquisitions .................................................. 69
10.6. Sale and Leaseback ...................................................... 69
10.7. Compliance with Environmental Laws ...................................... 70
10.8. Subordinated Debt ....................................................... 70
10.9. Employee Benefit Plans .................................................. 71
10.10. Business Activities ..................................................... 71
10.11. Fiscal Year ............................................................. 71
10.12. Transactions with Affiliates ............................................ 71
10.13. Bank Accounts ........................................................... 72
10.14. Merger Documents ........................................................ 72
11. FINANCIAL COVENANTS ............................................................... 72
11.1. Leverage Ratio .......................................................... 72
11.2. Senior Leverage Ratio ................................................... 73
11.3. Cash Flow Ratio ......................................................... 73
11.4. EBITDAR to Total Interest Expense and Rental Expense .................... 74
11.5. Growth Capital Expenditures ............................................. 74
12. CLOSING CONDITIONS ................................................................ 75
12.1. Loan Documents etc ...................................................... 75
12.1.1. Loan Documents ................................................ 75
12.1.2. Subordinated Loan Documents ................................... 75
12.1.3. Equity Documents .............................................. 75
12.1.4. Merger Documents .............................................. 75
12.2. Certified Copies of Governing Documents ................................. 75
12.3. Corporate or Other Action ............................................... 76
12.4. Incumbency Certificate .................................................. 76
12.5. Validity of Liens ....................................................... 76
12.6. Perfection Certificates and UCC Search Results .......................... 76
12.7. Certificates of Insurance ............................................... 76
12.8. Environmental Due Diligence ............................................. 77
12.9. Solvency Certificate .................................................... 77
12.10. Opinion of Counsel ...................................................... 77
12.11. Payment of Fees ......................................................... 77
12.12. Termination of Existing Credit Facilities ............................... 78
12.13. Capital Structure ....................................................... 78
12.14. Disbursement Instructions ............................................... 78
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12.15. No Material Adverse Change .............................................. 78
12.16. Financial Statements and Projections .................................... 78
12.17. No Litigation ........................................................... 78
12.18 Consents and Approvals .................................................. 79
12.19. Management Agreements; Employment Agreements ............................ 79
12.20. Other Documentation ..................................................... 79
12.21. Closing of Merger ....................................................... 79
12.22. Proceedings and Documents ............................................... 80
13. CONDITIONS TO ALL BORROWINGS ...................................................... 80
13.1. Representations True; No Event of Default ............................... 80
13.2. No Legal Impediment ..................................................... 81
14. EVENTS OF DEFAULT; ACCELERATION; ETC .............................................. 81
14.1. Events of Default and Acceleration ...................................... 81
14.2. Termination of Commitments .............................................. 84
14.3. Remedies ................................................................ 84
14.4. Distribution of Collateral Proceeds ..................................... 85
15. THE ADMINISTRATIVE AGENT .......................................................... 85
15.1. Authorization ........................................................... 85
15.2. Employees and Administrative Agents ..................................... 86
15.3. No Liability ............................................................ 86
15.4. No Representations ...................................................... 86
15.4.1. General ....................................................... 86
15.4.2. Closing Documentation, etc .................................... 87
15.5. Payments ................................................................ 87
15.5.1. Payments to Administrative Agent .............................. 87
15.5.2. Distribution by Administrative Agent .......................... 88
15.5.3. Delinquent Lenders ............................................ 88
15.6. Holders of Notes ........................................................ 88
15.7. Indemnity ............................................................... 88
15.8. Administrative Agent as Lender .......................................... 89
15.9. Resignation ............................................................. 89
15.10. Notification of Defaults and Events of Default .......................... 89
15.11. Duties in the Case of Enforcement ....................................... 89
16. ASSIGNMENT AND PARTICIPATION ...................................................... 90
16.1. Conditions to Assignment by Lenders ..................................... 90
16.1.1. Assignment by Lenders ......................................... 90
16.1.2. Accession ..................................................... 91
16.2. Certain Representations and Warranties; Limitations; Covenants........... 91
16.3. Register ................................................................ 93
16.4. New Notes ............................................................... 93
16.5. Participations .......................................................... 93
16.6. Assignee or Participant Affiliated with the Borrower .................... 94
16.7. Miscellaneous Assignment Provisions ..................................... 94
16.8. Assignment by Borrower .................................................. 94
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17. PROVISIONS OF GENERAL APPLICATIONS ................................................ 95
17.1. Setoff .................................................................. 95
17.2. Expenses ................................................................ 95
17.3. Indemnification ......................................................... 96
17.4. Treatment of Certain Confidential Information ........................... 97
17.4.1. Confidentiality ............................................... 97
17.4.2. Prior Notification ............................................ 98
17.4.3. Other ......................................................... 98
17.5. Survival of Covenants, Etc .............................................. 98
17.6. Notices ................................................................. 99
17.7. Governing Law ........................................................... 99
17.8. Headings ................................................................ 100
17.9. Counterparts ............................................................ 100
17.10. Entire Agreement, Etc ................................................... 100
17.11. Waiver of Jury Trial .................................................... 100
17.12. Consents, Amendments, Waivers, Etc ...................................... 101
17.13. Severability ............................................................ 102
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Exhibits
Exhibit A Form of Revolving Credit Note
Exhibit B Form of Loan Request
Exhibit C Form of Term Note
Exhibit D Form of Compliance Certificate
Exhibit E Form of Assignment and Acceptance
Exhibit F Form of Instrument of Accession
Schedules
Schedule 1 Lenders and Commitments
Schedule 1A Adjustments to EBITDA
Schedule 1B Mortgages to be delivered on the Closing Date
Schedule 8.3 Title to Properties; Leases
Schedule 8.6.2 Franchises, Patents, Copyrights, etc.
Schedule 8.7 Litigation
Schedule 8.15 Certain Transactions
Schedule 8.18 Environmental Compliance
Schedule 8.19 Subsidiaries Etc.
Schedule 8.24 Bank Accounts
Schedule 8.25 Stores
Schedule 9.17(a) Post-Closing Real Estate
Schedule 10.1 Existing Indebtedness
Schedule 10.2 Existing Liens
Schedule 10.3 Existing Investments
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REVOLVING CREDIT
AND
TERM LOAN AGREEMENT
This REVOLVING CREDIT AND TERM LOAN AGREEMENT is made as of July 17,
2001, by and among IL FORNAIO (AMERICA) CORPORATION, a Delaware corporation (the
"Borrower"), FLEET NATIONAL BANK, a national banking association, and the other
lending institutions listed on Schedule 1 attached hereto, FLEET NATIONAL BANK,
as administrative agent for itself and such other lending institutions and IBJ
WHITEHALL BANK & TRUST COMPANY, as syndication agent.
1. DEFINITIONS AND RULES OF INTERPRETATION.
1.1. DEFINITIONS. The following terms shall have the meanings set forth
in this Section 1 or elsewhere in the provisions of this Credit Agreement
referred to below:
Acceding Bank. See Section 16.1.2
Adjustment Date. The first day of the month immediately following the
month in which a Compliance Certificate is to be delivered by the Borrower
pursuant to Section 9.4(e).
Administrative Agent's Office. The Administrative Agent's office located
at 000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or at such other location as
the Administrative Agent may designate from time to time.
Administrative Agent. Fleet National Bank, acting as agent for the
Lenders and each other Person appointed as the successor Administrative Agent in
accordance with Section 15.9.
Administrative Agent's Special Counsel. Xxxxxxx Xxxx LLP or such other
counsel as may be approved by the Administrative Agent.
Affiliate. Any Person that would be considered to be an affiliate of the
Borrower (other than BBI) under Rule 144(a) of the Rules and Regulations of the
Securities and Exchange Commission, as in effect on the date hereof, if the
Borrower were issuing securities.
Agency Account. See Section 9.15.
Agency Account Agreement. See Section 9.15.
Applicable Excess Cash Flow Percentage. With respect to any mandatory
prepayment out of Consolidated Excess Operating Cash Flow required under Section
4.3.2, if the Senior Leverage Ratio of the Borrower and its Subsidiaries as of
the last day of the fiscal year with respect to which prepayment is to be
calculated is (a) less than or equal to 2.00 to 1.00, 0%, (b) less than or equal
to 2.25 to 1.00 but greater than 2.00 to 1.00, 50%, and (c) greater than 2.25 to
1.00, 75%.
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Applicable Margin. For each period commencing on an Adjustment Date
through the date immediately preceding the next Adjustment Date (each a "Rate
Adjustment Period"), the Applicable Margin shall be the applicable margin set
forth below with respect to the Leverage Ratio, as determined for the Reference
Period of the Borrower and its Subsidiaries ending on the fiscal quarter ended
immediately prior to the applicable Rate Adjustment Period.
------------- ------------------------------------ ------------------ -------------------------
LEVEL LEVERAGE RATIO BASE RATE LOANS EURODOLLAR RATE LOANS
------------- ------------------------------------ ------------------ -------------------------
I Greater than or equal to 3:00:1.00 2.25% 3.75%
------------- ------------------------------------ ------------------ -------------------------
II Less than 3:00:1.00 but greater
than or equal to 2:50:1.00 2.00% 3.50%
------------- ------------------------------------ ------------------ -------------------------
III Less than 2:50:1.00 but greater
than or equal to 2:00:1.00 1.75% 3.25%
------------- ------------------------------------ ------------------ -------------------------
IV Less than 2:00:1.00 1.50% 3.00%
------------- ------------------------------------ ------------------ -------------------------
Notwithstanding the foregoing, (a) for the period commencing on the
Closing Date through the end of the month in which the quarterly compliance
certificate for the fiscal quarter ending on or about September 30, 2001 is
delivered pursuant to Section 9.4(e) hereof, the Applicable Margin shall be that
percentage corresponding to Level I in the table above; and (b) if the Borrower
fails to deliver any Compliance Certificate pursuant to Section 9.4(e) hereof,
then for the period commencing on the date after the day on which such
Compliance Certificate was due through the date immediately preceding the
Adjustment Date that occurs immediately following the date on which such
Compliance Certificate is delivered, the Applicable Margin shall be the
Applicable Margin corresponding to Level I in the table above.
Applicable Pension Legislation. At any time, any pension or retirement
benefits legislation (be it national, federal, provincial, territorial or
otherwise) then applicable, subject to the preemption provisions of ERISA, to
the Borrower or any of its Subsidiaries.
Arranger. Fleet Securities, Inc.
Asset Sale. Any one or series of related transactions in which the
Borrower or any of its Subsidiaries conveys, sells, leases, licenses or
otherwise disposes of, directly or indirectly, any of its properties, businesses
or assets (including the sale or issuance of capital stock of any Subsidiary
other than to the Borrower or any Subsidiary of the Borrower) whether owned on
the Closing Date or thereafter acquired.
Assignment and Acceptance. See Section 16.1.
Assignment and Agency Account Agreement. The Assignment and Agency
Account Agreement, dated as of the Closing Date, among the Administrative Agent
and the Borrower, or any other substantially similar agreement in all respects
satisfactory to the Administrative Agent.
Balance Sheet Date. December 31, 2000.
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Base Rate. The higher of (a) the variable annual rate of interest so
designated from time to time by Fleet as its "prime rate", such rate being a
reference rate and not necessarily representing the lowest or best rate being
charged to any customer, and (b) one-half of one percent (1/2%) above the
Federal Funds Effective Rate. For the purposes of this definition, "Federal
Funds Effective Rate" shall mean for any day, the rate per annum equal to the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers, 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 on such transactions received by the Administrative
Agent from three funds brokers of recognized standing selected by the
Administrative Agent. Changes in the Base Rate resulting from any changes in
Fleet's "prime rate" shall take place immediately without notice or demand of
any kind.
Base Rate Loans. Revolving Credit Loans and all or any portion of the
Term Loan bearing interest calculated by reference to the Base Rate.
BBI. BancBoston Investments Inc.
Borrower. As defined in the preamble hereto.
BRS. Bruckmann, Xxxxxx, Xxxxxxxx & Co. II, L.P., a Delaware limited
partnership.
BRS Affiliate. Any Person which is controlled by or under common control
with, directly or indirectly, BRS any director, officer or employee of BRS, any
family member of any such director, officer or employee and any trust
established by any such Person.
Business Day. Any day on which banking institutions in Boston,
Massachusetts, are open for the transaction of banking business and, in the case
of Eurodollar Rate Loans, also a day which is a Eurodollar Business Day.
Capital Assets. Fixed assets, both tangible (such as land, buildings,
fixtures, machinery and equipment) and intangible (such as patents, copyrights,
trademarks, franchises and good will); provided that Capital Assets shall not
include any item customarily charged directly to expense or depreciated over a
useful life of twelve (12) months or less in accordance with GAAP.
Capital Expenditures. Amounts paid or Indebtedness incurred by the
Borrower or any of its Subsidiaries in connection with (i) the purchase or lease
by the Borrower or any of its Subsidiaries of Capital Assets that would be
required to be capitalized and shown on the balance sheet of such Person in
accordance with GAAP, (ii) Consolidated Restaurant Pre-Opening Costs, or (iii)
the lease of any assets by the Borrower or any of its Subsidiaries as lessee
under any Synthetic Lease to the extent that such assets would have been Capital
Assets had the Synthetic Lease been treated for accounting purposes as a
Capitalized Lease, net of any expected tenant improvement allowances related to
a Store.
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Capitalized Leases. Leases under which the Borrower or any of its
Subsidiaries is the lessee or obligor, the discounted future rental payment
obligations under which are required to be capitalized on the balance sheet of
the lessee or obligor in accordance with GAAP.
Capital Stock. Any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation) and any
and all warrants, rights or options to purchase any of the foregoing.
Cash Equivalents. As to the Borrower and its Subsidiaries, (a)
securities issued or directly and fully guaranteed or insured by the United
States of America and having a maturity of not more than six (6) months from the
date of acquisition; (b) certificates of deposit, time deposits and eurodollar
time deposits with maturities of six (6) months or less from the date of
acquisition, bankers' acceptances with maturities not exceeding six (6) months
and overnight bank deposits, in each case, (i) with any Lenders or (ii) with any
domestic commercial bank organized under the laws of the United States of
America or any state thereof, in each case having a rating of not less than A or
its equivalent by S&P or any successor and having capital and surplus in excess
of $1,000,000,000; (c) repurchase obligations with a term of not more than seven
(7) days for underlying securities of the types described in clauses (a) and (b)
above; and (d) any commercial paper or finance company paper issued by (i) any
Lender or any holding company controlling any Lender or (ii) any other Person
that is rated not less than "P-1" or "A-1" or their equivalents by Xxxxx'x or
S&P or their successors.
Cash Flow Ratio. As at any date of determination, the ratio of (a)
Consolidated Cash Flow for the Reference Period ending on such date, to (b)
Consolidated Financial Obligations for such Reference Period.
Casualty Event. With respect to any property (including any interest in
property) of the Borrower or any of its Subsidiaries, any loss of, damage to, or
condemnation or other taking of, such property for which the Borrower or such
Subsidiary receives insurance proceeds, proceeds of a condemnation award or
other compensation.
CERCLA. See Section 8.18(a).
Change of Control. At any time, the occurrence of one or more of the
following events: (i) BRS or the BRS Affiliates shall collectively cease to own
directly or indirectly at least fifty-one percent (51%) of the Voting Stock and
economic interests of the Borrower, (ii) BRS and the BRS Affiliates shall
collectively cease to have the power, directly or indirectly (including under
any stockholders' agreement) to elect a majority of the directors of the
Borrower, or (iii) the replacement of a majority of the board of directors of
the Borrower over a two-year period from the directors who constituted the board
of directors of the Borrower, as applicable, at the beginning of such period,
and such replacement shall not (1) have been approved by a vote of at least a
majority of the board of directors of the Borrower, as applicable, then still in
office who either were members of such board of directors at the beginning of
such period or whose election as a member of such board of directors was
previously so approved, or (2) have been elected or nominated for election by
BRS or a BRS Affiliate.
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Closing Date. The first date on which the conditions set forth in
Section 12 and Section 13 have been satisfied and any Loans are to be made or
any Letter of Credit is to be issued hereunder.
Code. The Internal Revenue Code of 1986.
Collateral. All of the property, rights and interests of the Borrower
and its Subsidiaries that are or are intended to be subject to the Liens created
by the Security Documents.
Commitment. With respect to each Lender, the amount set forth on
Schedule 1 hereto as the amount of such Lender's commitment to make Revolving
Credit Loans to, and to participate in the issuance, extension and renewal of
Letters of Credit for the account of, the Borrower, as the same may be modified
pursuant to Section 16.1.2 hereof, and as the same may be reduced from time to
time; or if such commitment is terminated pursuant to the provisions hereof,
zero.
Commitment Fee. See Section 2.2.
Commitment Percentage. With respect to each Lender, the percentage set
forth on Schedule 1 hereto as such Lender's percentage of the aggregate
Commitments of all of the Lenders, and with respect to the Term Loan, the
percentage amount set forth on Schedule 1 reflecting such Lender's commitment to
make the Term Loan.
Compliance Certificate. See Section 9.4(e).
Concentration Accounts. Any depository account that is (a) in the name
of the Borrower, (b) under the control of the Administrative Agent for the
benefit of the Lenders and the Administrative Agent, and (c) with a financial
institution reasonably acceptable to the Administrative Agent that has entered
into an Agency Account Agreement with the Administrative Agent and the Borrower.
Consolidated or consolidated. With reference to any term defined herein,
shall mean that term as applied to the accounts of the Borrower and its
Subsidiaries, consolidated in accordance with GAAP.
Consolidated Cash Flow. For any period, Consolidated EBITDA of the
Borrower and its Subsidiaries for such period, minus the sum of (a) cash income
taxes paid during such period by the Borrower and its Subsidiaries on a
consolidated basis and (b) the greater of (i) the aggregate amount of
Maintenance Capital Expenditures made during such period by the Borrower and its
Subsidiaries or (ii) $1,400,000, plus decreases in Consolidated Working Capital
from the beginning to the end of such period or minus increases in Consolidated
Working Capital from the beginning to the end of such period.
Consolidated Current Assets. All assets of the Borrower and its
Subsidiaries on a consolidated basis that, in accordance with GAAP, are properly
classified as current assets, provided that (i) notes and accounts receivable
shall be included only if good and collectible as determined by the Borrower in
accordance with established practice consistently applied and, with respect to
such notes, only if payable on demand or within one (1) year from the date as of
which Consolidated Current Assets are to be determined and if not directly or
indirectly
14
-6-
renewable or extendible at the option of the debtors, by their terms, or by the
terms of any instrument or agreement relating thereto, beyond such year, and,
with respect to such accounts receivable, only if payable and outstanding not
more than ninety (90) days after the date of the shipment of goods or other
transaction out of which any such account receivable arose; and such notes and
accounts receivable shall be taken at their face value less reserves determined
to be sufficient in accordance with GAAP; and (ii) inventory shall be included
only if and to the extent that the same shall be marketable in the ordinary
course of business.
Consolidated Current Liabilities. All liabilities and other Indebtedness
of the Borrower and its Subsidiaries on a consolidated basis maturing on demand
or within one (1) year from the date as of which Consolidated Current
Liabilities are to be determined, and such other liabilities as may properly be
classified as current liabilities in accordance with GAAP.
Consolidated EBITDA. For any period, the sum of (a) the Consolidated
Pre-Tax Income of the Borrower and its Subsidiaries for such period, plus (b) in
each case to the extent deducted in the calculation of Consolidated Pre-Tax
Income, (i) Consolidated Total Interest Expense for such period, plus (ii)
Consolidated Restaurant Pre-Opening Costs for such period plus (iii)
depreciation and amortization expenses (excluding amortization of Transaction
Costs) for such period, plus (iv) Pro Forma Adjustments for such period
certified by the chief financial officer of the Borrower, plus (v) non-recurring
charges for such period, in such amounts and as more fully described on Schedule
1A attached hereto, plus (vi) expenses (or amortization of expenses) relating to
Transaction Costs during such period to the extent the aggregate amount of
Transaction Costs does not exceed $8,600,000.
Consolidated EBITDAR. For any period, the sum of (a) the Consolidated
EBITDA of the Borrower and its Subsidiaries for such period, plus (b)
Consolidated Rental Expense for such period.
Consolidated Excess Operating Cash Flow. For any period, the sum of (a)
Consolidated Cash Flow of the Borrower and its Subsidiaries for such period,
minus (b) the aggregate amount of Growth Capital Expenditures of the Borrower
and its Subsidiaries made during such period to the extent that such Growth
Capital Expenditures were not financed by the incurrence of Indebtedness
permitted hereunder (including without limitation, Revolving Credit Loans
incurred hereunder), minus (c) Consolidated Cash Interest Expense paid during
such period, minus (d) required principal repayments on Indebtedness of the
Borrower and its Subsidiaries including Capitalized Leases and payments with
respect to Synthetic Leases during such period, minus (e) any voluntary
prepayment of the Term Loans during such period.
Consolidated Financial Obligations. For any period, the sum of (a) all
scheduled payments of principal on Indebtedness of the Borrower and its
Subsidiaries, including Capitalized Leases and including Synthetic Leases during
such period (but not including Consolidated Rental Expense), plus (b)
Consolidated Cash Interest Expense. Demand obligations shall be deemed to be due
and payable during any period during which such obligations are outstanding.
Consolidated Funded Indebtedness. At any time, the sum of (a) the
aggregate amount of Indebtedness of the Borrower and its Subsidiaries, on a
consolidated basis, relating to the
15
-7-
borrowing of money or the obtaining of credit (but not including the Maximum
Drawing Amount still available under Letters of Credit or trade credit obtained
in the ordinary course of business) or in respect of Capitalized Leases (but not
including Indebtedness consisting of deferred tax liability), plus (b) without
duplication, all Indebtedness of the type described in clause (a) above
guaranteed by the Borrower or any of its Subsidiaries.
Consolidated Net Income (or Deficit). The consolidated net income (or
deficit) of the Borrower and its Subsidiaries, after deduction of all expenses,
taxes, and other proper charges, determined in accordance with GAAP.
Consolidated Pre-Tax Income. For any period, Consolidated Net Income for
such period plus, to the extent deducted from the calculation of Consolidated
Net Income, income tax expenditures for such period, determined in accordance
with GAAP.
Consolidated Rental Expense. For any period, all minimum rental expense
of the Borrower and its Subsidiaries during such period, determined on a
consolidated basis in accordance with GAAP, incurred under any rental agreements
or leases of real or personal property, including space leases and ground
leases, other than obligations in respect of any Capitalized Leases or any
Synthetic Leases.
Consolidated Restaurant Pre-Opening Costs. "Start-up costs" (such term
used herein as defined in SOP 98-5 published by the American Institute of
Certified Public Accountants) related to the opening and organizing of new
Stores, such costs including, without limitation, the cost of feasibility
studies, staff-training, and recruiting and travel costs for employees engaged
in such start-up activities.
Consolidated Senior Funded Indebtedness. At any time, the difference of
(a) Consolidated Funded Indebtedness, minus (b) Subordinated Debt.
Consolidated Total Interest Expense. For any period, the aggregate
amount of interest required to be paid in cash by the Borrower and its
Subsidiaries during such period on all Indebtedness of the Borrower and its
Subsidiaries outstanding during all or any part of such period, whether such
interest was or is required to be reflected as an item of expense or
capitalized, including payments consisting of interest in respect of Capitalized
Leases, or any Synthetic Lease (but not including commitment fees, agency fees,
facility fees, balance deficiency fees and similar fees or expenses, the
one-time up-front "Closing Fee" referred to in the Fee Letter or any one-time
up-front closing fee paid in connection with the Subordinated Debt) in
connection with the borrowing of money.
Consolidated Working Capital. The excess of Consolidated Current Assets
over Consolidated Current Liabilities.
Conversion Request. A notice given by the Borrower to the Administrative
Agent of the Borrower's election to convert or continue a Loan in accordance
with Section 2.7.
Credit Agreement. This Revolving Credit and Term Loan Agreement,
including the Schedules and Exhibits hereto.
00
-0-
Xxxx Xxxxxxxx. Any sale or issuance of debt by the Parent or any of its
Subsidiaries other than those permitted pursuant to Section 10.1.
Default. See Section 14.1.
Delinquent Lender. See Section 15.5.3.
Distribution. The declaration or payment of any dividend on or in
respect of any shares of any class of the Capital Stock of any Person, other
than dividends payable solely in shares of common stock of such Person; the
purchase, redemption, defeasance, retirement or other acquisition of any shares
of any class of the Capital Stock of any Person, directly or indirectly through
a Subsidiary of such Person or otherwise (including the setting apart of assets
for a sinking or other analogous fund to be used for such purpose); the return
of capital by the Borrower to its shareholders as such; or any other
distribution on or in respect of any shares of any class of the Capital Stock of
any Person.
Dollars or $. Dollars in lawful currency of the United States of
America.
Domestic Lending Office. Initially, the office of each Lender designated
as such in Schedule 1 hereto; thereafter, such other office of such Lender, if
any, located within the United States that will be making or maintaining Base
Rate Loans.
Drawdown Date. The date on which any Revolving Credit Loan or the Term
Loan is made or is to be made, and the date on which any Revolving Credit Loan
is converted or continued in accordance with Section 2.7 or all or any portion
of the Term Loan is converted or continued in accordance with Section 4.5.2.
Eligible Assignee. Any of (a) a commercial bank or finance company
organized under the laws of the United States of America, or any State thereof
or the District of Columbia, and having total assets in excess of
$1,000,000,000; (b) a savings and loan association or savings bank organized
under the laws of the United States of America, or any State thereof or the
District of Columbia, and having a net worth of at least $100,000,000,
calculated in accordance with generally accepted accounting principles; (c) a
commercial bank organized under the laws of any other country which is a member
of the Organization for Economic Cooperation and Development (the "OECD"), or a
political subdivision of any such country, and having total assets in excess of
$1,000,000,000, provided that such bank is acting through a branch or agency
located in the country in which it is organized or another country which is also
a member of the OECD; (d) the central bank of any country which is a member of
the OECD; (e) any mutual fund, insurance company, or investment fund that is an
"accredited investor" (as defined in Regulation D of the Securities Act of 1933,
as amended); and (f) if, but only if, any Event of Default has occurred and is
continuing, any other bank, insurance company, commercial finance company or
other financial institution or other Person approved by the Administrative
Agent, such approval not to be unreasonably withheld.
Employee Benefit Plan. Any employee benefit plan within the meaning of
Section 3(3) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate, other than a Guaranteed Pension Plan or a Multiemployer Plan.
17
-9-
Environmental Laws. See Section 8.18(a).
EPA. See Section 8.18(b).
Equity Documents. Collectively, (i) the Securities Holders Agreement,
dated as of the date hereof among BRS, BBI and the other investors named
therein, (ii) the Registration Rights Agreement, dated as of the date hereof,
among BRS, BBI and the other investors named therein, (iii) the Warrants (as
defined in the Subordinated Loan Document), and (iv) the Purchase Agreement.
Equity Issuance. The sale or issuance by the Borrower or any of its
Subsidiaries of any of its Capital Stock.
ERISA. The Employee Retirement Income Security Act of 1974.
ERISA Affiliate. Any Person which is treated as a single employer with
the Borrower under Section 414 of the Code.
ERISA Reportable Event. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of Section 4043 of ERISA and the regulations
promulgated thereunder.
Eurocurrency Reserve Rate. For any day with respect to a Eurodollar Rate
Loan, the maximum rate (expressed as a decimal) at which any bank subject
thereto would be required to maintain reserves under Regulation D of the Board
of Governors of the Federal Reserve System (or any successor or similar
regulations relating to such reserve requirements) against "Eurocurrency
Liabilities" (as that term is used in Regulation D), if such liabilities were
outstanding. The Eurocurrency Reserve Rate shall be adjusted automatically on
and as of the effective date of any change in the Eurocurrency Reserve Rate.
Eurodollar Business Day. Any day on which commercial banks are open for
international business (including dealings in Dollar deposits) in London or such
other eurodollar interbank market as may be selected by the Administrative Agent
in its sole discretion acting in good faith.
Eurodollar Lending Office. Initially, the office of each Lender
designated as such in Schedule 1 hereto; thereafter, such other office of such
Lender, if any, that shall be making or maintaining Eurodollar Rate Loans.
Eurodollar Rate. For any Interest Period with respect to a Eurodollar
Rate Loan, the rate of interest equal to (a) the rate determined by the
Administrative Agent at which Dollar deposits for such Interest Period are
offered based on information presented on Telerate Page 3750 as of 10:00 a.m.
(Boston time) two Eurodollar Business Days prior to the beginning of such
Interest Period, divided by a number equal to 1.00 minus the Eurocurrency
Reserve Rate, if applicable, or (b) if such information on such Telerate Page is
not available, the rate at which the Administrative Agent's Eurodollar Lending
Office is offered Dollar deposits at 10:00 a.m. (Boston time) two Eurodollar
Business Days prior to the beginning of such Interest Period in the interbank
eurodollar market where the eurodollar and the foreign currency and exchange
18
-10-
operations of such Eurodollar Lending Office are customarily conducted, for
delivery on the first day of such Interest Period for the number of days
comprised therein and in an amount comparable to the amount of the Eurodollar
Rate Loan of Fleet to which such Interest Period applies, divided by a number
equal to 1.00 minus the Eurocurrency Reserve Rate, if applicable.
Eurodollar Rate Loans. Revolving Credit Loans and all or any portion of
the Term Loan bearing interest calculated by reference to the Eurodollar Rate.
Event of Default. See Section 14.1.
Fee Letter. The fee letter dated on or prior to the Closing Date among
the Borrower, the Administrative Agent, the Arranger.
Fees. Collectively, the Commitment Fee, the Letter of Credit Fees, the
Fronting Fees, and any fees under the Fee Letter and the Commitment Extension
Letter.
Financial Affiliate. A Subsidiary of the bank holding company
controlling any Lender, which Subsidiary is engaging in any of the activities
permitted by Section 4(e) of the Bank Holding Company Act of 1956 (12 U.S.C.
Section 1843).
Fleet. Fleet National Bank, a national banking association, in its
individual capacity.
Fronting Fee. See Section 5.6.
GAAP or generally accepted accounting principles. (a) When used in
Section 11, whether directly or indirectly through reference to a capitalized
term used therein, means (i) principles that are consistent with the principles
promulgated or adopted by the Financial Accounting Standards Board and its
predecessors, in effect for the fiscal year ended on the Balance Sheet Date, and
(ii) to the extent consistent with such principles, the accounting practice of
ILFO reflected in its financial statements for the year ended on the Balance
Sheet Date, and (b) when used in general, other than as provided above, means
principles that are (i) consistent with the principles promulgated or adopted by
the Financial Accounting Standards Board and its predecessors, as in effect from
time to time, and (ii) consistently applied with past financial statements of
ILFO adopting the same principles, provided that in each case referred to in
this definition of "GAAP" a certified public accountant would, insofar as the
use of such accounting principles is pertinent, be in a position to deliver an
unqualified opinion (other than a qualification regarding changes in GAAP) as to
financial statements in which such principles have been properly applied.
Governing Documents. With respect to any Person, its certificate or
articles of incorporation, its by-laws and all shareholder agreements, voting
trusts and similar arrangements applicable to any of its Capital Stock.
Governmental Authority. Any foreign, federal, state, regional, local,
municipal or other government, or any department, commission, board, bureau,
agency, public authority or instrumentality thereof, or any court or arbitrator.
19
-11-
Growth Capital Expenditures. (a) Capital Expenditures relating to the
construction, acquisition or opening of new Stores operated by the Borrower and
its Subsidiaries after the Closing Date, plus (b) Capital Expenditures relating
to the remodeling of existing Stores, plus (c) to the extent not included in the
calculation of such Capital Expenditures, Consolidated Restaurant Pre-Opening
Costs.
Guaranteed Pension Plan. Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA maintained or contributed to by the Borrower or
any ERISA Affiliate the benefits of which are guaranteed on termination in full
or in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer
Plan.
Hazardous Substances. See Section 8.18(b).
IBJ. IBJ Whitehall Bank & Trust Company.
ILFO. Il Fornaio (America) Corporation, and, from and after the Merger,
shall refer to the surviving entity of the Merger.
Indebtedness. As to any Person and whether recourse is secured by or is
otherwise available against all or only a portion of the assets of such Person
and whether or not contingent, but without duplication:
(a) every obligation of such Person for money borrowed,
(b) every obligation of such Person evidenced by bonds,
debentures, notes or other similar instruments, including obligations
incurred in connection with the acquisition of property, assets or
businesses,
(c) every reimbursement obligation of such Person with respect
to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person,
(d) every obligation of such Person issued or assumed as the
deferred purchase price of property or services (including securities
repurchase agreements but excluding trade accounts payable or accrued
liabilities arising in the ordinary course of business which are not
overdue or which are being contested in good faith),
(e) every obligation of such Person under any Capitalized Lease,
(f) every obligation of such Person under any Synthetic Lease,
(g) all sales by such Person of (i) accounts or general
intangibles for money due or to become due, (ii) chattel paper,
instruments or documents creating or evidencing a right to payment of
money or (iii) other receivables (collectively "receivables"), whether
pursuant to a purchase facility or otherwise, other than in connection
with the disposition of the business operations of such Person relating
thereto or a disposition of defaulted receivables for collection and not
as a financing arrangement, and together with any obligation of such
Person to pay any discount,
20
-12-
interest, fees, indemnities, penalties, recourse, expenses or other
amounts in connection therewith,
(h) every obligation of such Person (an "equity related purchase
obligation") to purchase, redeem, retire or otherwise acquire for value
any shares of Capital Stock issued by such Person or any rights measured
by the value of such Capital Stock,
(i) every obligation of such Person under any forward contract,
futures contract, swap, option or other financing agreement or
arrangement (including, without limitation, caps, floors, collars and
similar agreements), the value of which is dependent upon interest
rates, currency exchange rates, commodities or other indices (a
"derivative contract"),
(j) every obligation in respect of Indebtedness of any other
entity (including any partnership in which such Person is a general
partner) to the extent that such Person is liable therefor as a result
of such Person's ownership interest in or other relationship with such
entity, except to the extent that the terms of such Indebtedness provide
that such Person is not liable therefor and such terms are enforceable
under applicable law,
(k) every obligation, contingent or otherwise, of such Person
guaranteeing, or having the economic effect of guarantying or otherwise
acting as surety for, any obligation of a type described in any of
clauses (a) through (j) (the "primary obligation") of another Person
(the "primary obligor"), in any manner, whether directly or indirectly,
and including, without limitation, any obligation of such Person (i) to
purchase or pay (or advance or supply funds for the purchase of) any
security for the payment of such primary obligation, (ii) to purchase
property, securities or services for the purpose of assuring the payment
of such primary obligation, or (iii) to maintain working capital, equity
capital or other financial statement condition or liquidity of the
primary obligor so as to enable the primary obligor to pay such primary
obligation.
The "amount" or "principal amount" of any Indebtedness at any time of
determination represented by (t) any Indebtedness, issued at a price that is
less than the principal amount at maturity thereof, shall be the amount of the
liability in respect thereof determined in accordance with GAAP, (u) any
Capitalized Lease shall be the principal component of the aggregate of the
rentals obligation under such Capitalized Lease payable over the term thereof
that is not subject to termination by the lessee, (v) any sale of receivables
shall be the amount of unrecovered capital or principal investment of the
purchaser (other than the Borrower or any of its wholly-owned Subsidiaries)
thereof, excluding amounts representative of yield or interest earned on such
investment, (w) any Synthetic Lease shall be the stipulated loss value,
termination value or other equivalent amount, (x) any derivative contract shall
be the maximum amount of any termination or loss payment required to be paid by
such Person if such derivative contract were, at the time of determination, to
be terminated by reason of any event of default or early termination event
thereunder, whether or not such event of default or early termination event has
in fact occurred, (y) any equity related purchase obligation shall be the
maximum fixed redemption or purchase price thereof inclusive of any accrued and
unpaid dividends to be comprised in such redemption or purchase price and (z)
any guaranty or other contingent liability referred to in clause (k) shall be an
amount equal to the stated or determinable amount
21
-13-
of the primary obligation in respect of which such guaranty or other contingent
obligation is made 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.
Ineligible Securities. Securities which may not be underwritten or dealt
in by member banks of the Federal Reserve System under Section 16 of the Banking
Act of 1933 (12 U.S.C. Section 24, Seventh), as amended.
Instrument of Accession. See Section 16.1.2.
Interest Payment Date. (a) As to any Base Rate Loan, the last day of the
calendar quarter with respect to interest accrued during such calendar quarter,
including, without limitation, the calendar quarter which includes the Drawdown
Date of such Base Rate Loan; and (b) as to any Eurodollar Rate Loan in respect
of which the Interest Period is (i) three (3) months or less, the last day of
such Interest Period and (ii) more than three (3) months, the date that is three
(3) months from the first day of such Interest Period and, in addition, the last
day of such Interest Period.
Interest Period. With respect to each Revolving Credit Loan or all or
any relevant portion of the Term Loan, (a) initially, the period commencing on
the Drawdown Date of such Loan and ending on the last day of one of the periods
set forth below, as selected by the Borrower in a Loan Request or as otherwise
required by the terms of this Credit Agreement (i) for any Base Rate Loan, the
last day of the calendar quarter; and (ii) for any Eurodollar Rate Loan, 1, 2,
3, or 6 months; and (b) thereafter, each period commencing on the last day of
the next preceding Interest Period applicable to such Revolving Credit Loan or
all or such portion of the Term Loan and ending on the last day of one of the
periods set forth above, as selected by the Borrower in a Conversion Request;
provided that all of the foregoing provisions relating to Interest Periods are
subject to the following:
(A) if any Interest Period with respect to a Eurodollar Rate
Loan would otherwise end on a day that is not a Eurodollar Business Day,
that Interest Period shall be extended to the next succeeding Eurodollar
Business Day unless the result of such extension would be to carry such
Interest Period into another calendar month, in which event such
Interest Period shall end on the immediately preceding Eurodollar
Business Day;
(B) if any Interest Period with respect to a Base Rate Loan
would end on a day that is not a Business Day, that Interest Period
shall end on the next succeeding Business Day;
(C) if the Borrower shall fail to give notice as provided in
Section 2.7 or Section 4.5.2, as applicable, the Borrower shall be
deemed to have requested a conversion of the affected Eurodollar Rate
Loan to a Base Rate Loan and the continuance of all Base Rate Loans as
Base Rate Loans on the last day of the then current Interest Period with
respect thereto;
22
-14-
(D) any Interest Period relating to any Eurodollar Rate Loan
that begins on the last Eurodollar Business Day of a calendar month (or
on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last
Eurodollar Business Day of a calendar month; and
(E) any Interest Period that would otherwise extend beyond the
Revolving Credit Loan Maturity Date (if comprising a Revolving Credit
Loan) or the Term Loan Maturity Date (if comprising the Term Loan or a
portion thereof) shall end on the Revolving Credit Loan Maturity Date or
(as the case may be) the Term Loan Maturity Date.
Interest Rate Agreement. Any interest rate swap agreement, interest rate
cap agreement, interest rate collar agreement, interest rate futures contract,
interest rate option agreement or other similar agreement or arrangement to
which the Borrower and any Lender is a party, designed to protect the Borrower
against fluctuations in interest rates.
Interim Balance Sheet Date. March 31, 2001.
Investments. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of Capital Stock or Indebtedness
of, or for loans, advances, capital contributions or transfers of property to,
or in respect of any guaranties (or other commitments as described under
Indebtedness), or obligations of, any Person. In determining the aggregate
amount of Investments outstanding at any particular time: (a) the amount of any
Investment represented by a guaranty shall be taken at not less than the
principal amount of the obligations guaranteed and still outstanding; (b) there
shall be included as an Investment all interest accrued with respect to
Indebtedness constituting an Investment unless and until such interest is paid;
(c) there shall be deducted in respect of each such Investment any amount
received as a return of capital (but only by repurchase, redemption, retirement,
repayment, liquidating dividend or liquidating distribution); (d) there shall
not be deducted in respect of any Investment any amounts received as earnings on
such Investment, whether as dividends, interest or otherwise, except that
accrued interest included as provided in the foregoing clause (b) may be
deducted when paid; and (e) there shall not be deducted from the aggregate
amount of Investments any decrease in the value thereof.
Lender Affiliate. (a) With respect to any Lender, (i) an Affiliate of
such Lender or (ii) any entity (whether a corporation, partnership, limited
liability company, trust or legal entity) that is engaged in making, purchasing,
holding or otherwise investing in bank loans and similar extensions of credit in
the ordinary course of its business and is administered or managed by such
Lender or an Affiliate of such Lender and (b) with respect to any Lender that is
a fund which invests in bank loans and similar extensions of credit, any other
entity (whether a corporation, partnership, limited liability company, trust or
other legal entity) that is a fund that invests in bank loans and similar
extensions of credit and is managed by the same investment advisor as such
Lender or by an Affiliate of such investment advisor.
Lenders. Fleet and the other lending institutions listed on Schedule 1
hereto and any other Person who becomes an assignee of any rights and
obligations of a Lender pursuant to Section 16.
23
-15-
Letter of Credit. See Section 5.1.1.
Letter of Credit Application. See Section 5.1.1.
Letter of Credit Fee. See Section 5.6.
Letter of Credit Participation. See Section 5.1.4.
Leverage Ratio. As at any date of determination, the ratio of (a)
Consolidated Funded Indebtedness outstanding on such date to (b) Consolidated
EBITDA for the Reference Period ending on such date.
Lien. Any mortgage, deed of trust, security interest, pledge,
hypothecation, assignment, attachment, deposit arrangement, encumbrance, lien
(statutory, judgment or otherwise), or other security agreement or preferential
arrangement of any kind or nature whatsoever (including any conditional sale or
other title retention agreement, any Capitalized Lease, any Synthetic Lease, any
financing lease involving substantially the same economic effect as any of the
foregoing and the filing of any financing statement under the UCC or comparable
law of any jurisdiction).
Loan Documents. This Credit Agreement, the Notes, the Letter of Credit
Applications, the Letters of Credit, the Fee Letter and the Security Documents.
Loan Request. See Section 2.6.
Loans. The Revolving Credit Loans and the Term Loan.
MAC. Manhattan Acquisition Corporation, a Delaware corporation.
Maintenance Capital Expenditures. Capital Expenditures that are not
Growth Capital Expenditures.
Management Agreement. The Management Agreement dated as of the date
hereof among Bruckmann, Xxxxxx, Xxxxxxxx & Co., L.L.C. and the Borrower.
Material Adverse Effect. With respect to any event or occurrence of
whatever nature (including any adverse determination in any litigation,
arbitration or governmental investigation or proceeding):
(a) a material adverse effect on the business, properties, prospects,
condition (financial or otherwise), assets, operations or income of the Borrower
and its Subsidiaries, taken as a whole; or
(b) any impairment of the validity, binding effect or enforceability of
this Credit Agreement or any of the other Loan Documents, any impairment of the
rights, remedies or benefits available to the Administrative Agent or any Lender
under any Loan Document or any material impairment of the attachment, perfection
or priority of any Lien of the Administrative Agent under the Security
Documents.
24
-16-
Maximum Drawing Amount. The maximum aggregate amount that the
beneficiaries may at any time draw under outstanding Letters of Credit, as such
aggregate amount may be reduced from time to time pursuant to the terms of the
Letters of Credit.
Merger. The merger of MAC with and into ILFO as contemplated by the
Merger Documents.
Merger Agreement. The Agreement and Plan of Merger, dated as of November
14, 2000 (and as amended on January 9, 2001, May 1, 2001 and June 13, 2001)
between ILFO and MAC, evidencing a maximum purchase price per share of $12.00,
as in effect without giving effect to any amendments, modifications or waivers
of the term thereof other than amendments, modifications and waivers certified
copies of which have been delivered to the Administrative Agent and approved by
the Administrative Agent in writing.
Merger Documents. The Merger Agreement, and all other agreements, side
letters and documents required to be entered into or delivered pursuant to the
Merger Agreement or in connection with the Merger, each in the form delivered to
the Administrative Agent on or prior to the Closing Date or otherwise
satisfactory to the Administrative Agent.
Xxxxx'x. Xxxxx'x Investors Services, Inc.
Mortgages. Collectively, (a) the several leasehold mortgages, dated or
to be dated on or prior to the Closing Date and set forth on Schedule 1B hereto,
and (b) each of the Mortgages required to be entered into after the Closing Date
by the Borrower or any Subsidiary pursuant to Section 9.17 hereof, with respect
to the leasehold interests of the Borrower and its Subsidiaries in the Real
Estate and in form and substance reasonably satisfactory to the Administrative
Agent.
Multiemployer Plan. Any multiemployer plan within the meaning of Section
3(37) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate.
Net Cash Debt Issuance Proceeds. With respect to any Debt Issuance, the
excess of the gross cash proceeds received by such Person for such Debt Issuance
after deduction of all reasonable and customary transaction expenses (including,
without limitation, underwriting discounts and commissions) actually incurred in
connection with such Debt Issuance.
Net Cash Equity Issuance Proceeds. With respect to any Equity Issuance,
the excess of the gross cash proceeds received by such Person for such Equity
Issuance after deduction of all reasonable and customary transaction expenses
(including, without limitation, underwriting discounts and commissions) actually
incurred in connection with such a sale or other issuance.
Net Cash Sale Proceeds. The net cash proceeds received by a Person in
respect of any Asset Sale or any Sale-Leaseback, less the sum of (a) all
reasonable out-of-pocket fees, commissions and other reasonably and customary
direct expenses actually incurred in connection with such Asset Sale, including
the amount of any income, transfer or documentary taxes required to be paid by
such Person in connection with such sale or other disposition, and (b) the
aggregate amount of cash so received by such Person which is required to be used
to retire (in whole or in part) any Indebtedness (other than under the Loan
Documents) of such
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Person permitted by this Credit Agreement that was secured by a lien or security
interest permitted by this Credit Agreement having priority over the liens and
security interests (if any) of the Administrative Agent (for the benefit of the
Administrative Agent and the Lenders) with respect to such assets transferred
and which is required to be repaid in whole or in part (which repayment, in the
case of any other revolving credit arrangement or multiple advance arrangement,
reduces the commitment thereunder) in connection with such Asset Sale or
Sale-Leaseback.
Notes. The Term Notes and the Revolving Credit Notes.
Obligations. All indebtedness, obligations and liabilities of the
Borrower and its Subsidiaries to any of the Lenders and the Administrative
Agent, individually or collectively, existing on the date of this Credit
Agreement or arising thereafter, direct or indirect, joint or several, absolute
or contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, operation of law or otherwise, arising or
incurred under this Credit Agreement or any of the other Loan Documents or any
Interest Rate Agreement or in respect of any of the Loans made or Reimbursement
Obligations incurred or any of the Notes, Letter of Credit Application, Letter
of Credit or other instruments at any time evidencing any thereof or arising or
incurred under any Interest Rate Agreement entered into by the Borrower or any
of its Subsidiaries with any of the Lenders.
Other Taxes. Any present or future stamp or documentary taxes or capital
taxes or any other excise or property taxes, charges or similar duties or levies
which arise from any payment made hereunder or from the execution, delivery or
registration of, or otherwise with respect to, this Credit Agreement or any of
the other Loan Documents.
outstanding. With respect to the Loans, the aggregate unpaid principal
thereof as of any date of determination.
PBGC. The Pension Benefit Guaranty Corporation created by Section 4002
of ERISA and any successor entity or entities having similar responsibilities.
Perfection Certificate. The Perfection Certificate dated as of the date
hereof delivered by the Borrower to the Administrative Agent on the Closing
Date.
Permitted Liens. Liens permitted by Section 10.2.
Person. Any individual, corporation, limited liability company
partnership, limited liability partnership, trust, other unincorporated
association, business, or other legal entity, and any Governmental Authority.
Preferred Stock. The Borrower's "Preferred Stock" as such term is
defined in the Borrower's Certificate of incorporation.
Pro Forma Adjustments. Adjustments relating to executive compensation
and expenses incurred by ILFO prior to the Merger which were related solely to
the fact that ILFO was a company registered under the Securities Act of 1933,
such adjustments in amounts and at times
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acceptable to the Administrative Agent, provided, however, that the aggregate
amount of Pro Forma Adjustments for any fiscal period shall not exceed the
amount set forth opposite such period in the table set forth below:
------------------------------- ---------------------
Fiscal Period Ending: Amount
------------------------------- ---------------------
Closing Date $1,100,000
September 30, 2001 $850,000
December 31, 2001 $550,000
March 31, 2002 $300,000
June 30, 2002 $70,000
Thereafter $0
------------------------------- ---------------------
Pro Forma Balance Sheet. See Section 8.4.3.
Purchase Agreement. The Securities Purchase and Contribution Agreement,
dated as of November 15, 2000, as amended as of January 9, 2001 and as further
amended as of May 1, 2001, among MAC, BRS and the other investors named or
joining therein.
Rate Adjustment Period. As defined in the definition of "Applicable
Margin".
RCRA. See Section 8.18(a).
Real Estate. All real property at any time owned or leased (as lessee or
sublessee) by the Borrower or any of its Subsidiaries.
Record. The grid attached to a Note, or the continuation of such grid,
or any other similar record, including computer records, maintained by any
Lender with respect to any Loan referred to in such Note.
Reference Lender. Fleet.
Reference Period. Any period of four (4) consecutive fiscal quarters of
the Borrower ending on the relevant date, provided, however, that solely for
purposes of calculating the Cash Flow Ratio contained in Section 11.3 and the
ratio of EBITDAR to Total Interest Expense and Rental Expense contained in
Section 11.4, until four (4) full fiscal quarters of the Borrower have elapsed
after September 30, 2001, such shorter period of one (1), two (2) or three (3)
full fiscal quarters elapsed since September 30, 2001.
Register. See Section 20.3.
Reimbursement Obligation. The Borrower's obligation to reimburse the
Administrative Agent and the Lenders on account of any drawing under any Letter
of Credit as provided in Section 5.2.
Required Lenders. As of any date, (a) if there are less than three (3)
Lenders on such date, all Lenders, and (b) if there are three (3) or more
Lenders on such date, the Lenders
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holding at least sixty-six and two-thirds percent (66 2/3%) of the outstanding
principal amount of the Notes on such date; and if no such principal is
outstanding, the Lenders whose aggregate Commitments constitutes at least
sixty-six and two-thirds percent (66 2/3%) of the Total Commitment.
Restricted Payment. In relation to the Borrower, any (a) Distribution,
(b) payment by the Borrower to BRS or BRS Affiliate other than payments to any
BRS Affiliate for goods and services in the ordinary course of business on terms
equivalent to those obtainable in arms length transactions, or (c) payment in
respect of the Subordinated Debt.
Revolving Credit Loan Maturity Date. July 17, 2007.
Revolving Credit Loans. Revolving credit loans made or to be made by the
Lenders to the Borrower pursuant to Section 2.
Revolving Credit Note Record. A Record with respect to a Revolving
Credit Note.
Revolving Credit Notes. See Section 2.4.
Sale-Leaseback. see Section 10.6.
XXXX. See Section 8.18(a).
Security Agreement. The Security Agreement, dated or to be dated on or
prior to the Closing Date, among the Borrower and the Administrative Agent and
in form and substance satisfactory to the Lenders and the Administrative Agent.
Security Documents. The Security Agreement, the Trademark Security
Agreement, the Mortgages, the Assignment and Agency Account Agreement, the
Agency Account Agreements and all other instruments and documents, including
without limitation Uniform Commercial Code financing statements, required to be
executed or delivered pursuant to any Security Document.
Senior Funded Indebtedness. At any time of determination, the sum of
Consolidated Funded Indebtedness minus Subordinated Debt.
Senior Leverage Ratio. As at any date of determination, the ratio of (a)
Senior Funded Indebtedness at such date to (b) Consolidated EBITDA for the
Reference Period ending on such date.
S&P. Standard & Poor's Ratings Group.
Stock Pledge Agreement. The Stock Pledge Agreement, dated or to be dated
on or prior to the Closing Date, among BRS and the Administrative Agent pursuant
to which all of the Voting Stock of the Borrower owned by BRS is pledged to the
Administrative Agent and in form and substance satisfactory to the Lenders and
the Administrative Agent.
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Store. A particular restaurant or bakery at a particular location that
is owned or operated by the Borrower or any of its Subsidiaries.
Subordinated Debt. Unsecured Indebtedness of the Borrower or any of its
Subsidiaries (i) in the principal amount not to exceed $13,000,000 advanced
pursuant to the terms of the Subordinated Loan Agreement, (ii) all interest
(including interest on overdue interest) accruing on the principal amount
specified in the foregoing clause, (ii) any additional notes that may be issued
from time to time ("PIK Notes") in satisfaction of any interest or other amounts
owed by the Borrower under the Subordinated Loan Agreement, (iii) any amounts
owed by the Borrower under Article 11 of the Subordinated Loan Agreement,
including any Put Notes (as defined in the Subordinated Loan Agreement) that may
be issued by the Borrower from time to time, and (iv) any interest accruing on
the PIK Notes or the Put Notes, in each case that is expressly subordinated and
made junior to the payment and performance in full of the Obligations pursuant
to the terms of the Subordinated Loan Agreement.
Subordinated Loan Agreement. The Securities Purchase Agreement among the
Borrower, BBI, I.B.J. Whitehall Capital Corporation and Exeter Capital Partners
IV, L.P., dated as of the date hereof, a certified copy of which was delivered
to the Administrative Agent on or prior to the Closing Date, together with
amendments or modifications thereto permitted pursuant to Section 10.8.
Subordinated Loan Documents. The Subordinated Loan Agreement, the Notes
(as defined in the Subordinated Loan Agreement), and any Put Notes or PIK Notes
that may be issued from time to time in satisfaction of amounts owed under the
Subordinated Loan Agreement, certified copies of which were delivered to the
Administrative Agent on or prior to the Closing Date, together with amendments
or modifications thereto permitted pursuant to Section 10.8.
Subsidiary. Any corporation, association, trust, or other business
entity of which the designated parent shall at any time own directly or
indirectly through a Subsidiary or Subsidiaries at least a majority (by number
of votes) of the outstanding Voting Stock.
Syndication Agent. IBJ Whitehall Bank & Trust Company.
Synthetic Lease. Any lease of goods or other property, whether real or
personal, which is treated as an operating lease under GAAP and as a loan or
financing for U.S. income tax purposes.
Taxes. Any and all present or future taxes, levies, imposts, deductions,
duties, charges, fees, compulsory loans, withholdings and restrictions or
conditions of any nature imposed or levied by any jurisdiction or any political
subdivision thereof or taxing or other authority therein, and all liabilities
with respect thereto, excluding, in the case of each Lender and the
Administrative Agent, such taxes (including income taxes or franchise taxes) as
are imposed on or measured by each Lender's or (in case of payments made to the
Administrative Agent for its own account) the Administrative Agent's net income
by any jurisdiction (whether federal, state or local and including any political
subdivision thereof) under the laws of which such Lender or the Administrative
Agent, as the case may be, is organized or maintains a lending office.
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Term Loan. The term loan made or to be made by the Lenders to the
Borrower on the Closing Date in the aggregate principal amount of $25,000,000
pursuant to Section 4.1.
Term Loan Maturity Date. July 17, 2007.
Term Notes. See Section 4.2.
Term Note Record. A Record with respect to a Term Note.
Total Commitment. The sum of the Commitments of the Lenders, as in
effect from time to time.
Trademark Security Agreement. The Trademark Collateral Security and
Pledge Agreement, dated or to be dated on or prior to the Closing Date, made by
the Borrower in favor of the Administrative Agent and the Assignments of
Trademarks and Trademarks executed in connection therewith, all in form and
substance satisfactory to the Lenders and the Administrative Agent.
Transaction Costs. All of the costs, fees and expenses incurred by ILFO
or MAC in connection with the Merger, the Transaction Documents and the
transactions contemplated thereby and hereby, including, without limitation,
brokers, finders, or placement fees or commissions, attorneys' fees and fees of
other professionals.
Transaction Documents. Collectively, the Merger Documents, the
Subordinated Debt Documents and the Loan Documents.
Type. As to any Revolving Credit Loan or all or any portion of the Term
Loan, its nature as a Base Rate Loan or a Eurodollar Rate Loan.
Unpaid Reimbursement Obligation. Any Reimbursement Obligation for which
the Borrower does not reimburse the Administrative Agent and the Lenders on the
date specified in, and in accordance with, Section 5.2.
Unprofitable Store. At the relevant time of reference thereto, any Store
whose net income (without deduction or adjustment for expenses related to
interest, income taxes, depreciation or amortization or other non-cash charges,
gains or losses on the sale of Capital Assets or corporate overhead that may be
attributable to such Store) on an individual Store basis is less than $1 for the
twelve most recently ended fiscal months, provided that, solely for purposes of
determining whether any Store is an Unprofitable Store, it shall be assumed that
the net income of each Store shall be greater than $1 for each of its first six
months' of operation.
Voting Stock. Stock or similar interests, of any class or classes
(however designated), the holders of which are at the time entitled, as such
holders, to vote for the election of a majority of the directors (or persons
performing similar functions) of the corporation, association, trust or other
business entity involved, whether or not the right so to vote exists by reason
of the happening of a contingency.
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1.2. RULES OF INTERPRETATION.
(a) A reference to any document or agreement shall include such
document or agreement as amended, modified or supplemented from time to
time in accordance with its terms and the terms of this Credit
Agreement.
(b) The singular includes the plural and the plural includes the
singular.
(c) A reference to any law includes any amendment or
modification to such law.
(d) A reference to any Person includes its permitted successors
and permitted assigns.
(e) Accounting terms not otherwise defined herein have the
meanings assigned to them by GAAP applied on a consistent basis by the
accounting entity to which they refer.
(f) The words "include", "includes" and "including" are not
limiting.
(g) All terms not specifically defined herein or by GAAP, which
terms are defined in the Uniform Commercial Code as in effect in the
Commonwealth of Massachusetts, have the meanings assigned to them
therein, with the term "instrument" being that defined under Article 9
of the Uniform Commercial Code.
(h) Reference to a particular "Section " refers to that section
of this Credit Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of like
import shall refer to this Credit Agreement as a whole and not to any
particular section or subdivision of this Credit Agreement.
(j) Unless otherwise expressly indicated, in the computation of
periods of time from a specified date to a later specified date, the
word "from" means "from and including," the words "to" and "until" each
mean "to but excluding," and the word "through" means "to and
including."
(k) This Credit Agreement and the other Loan Documents may use
several different limitations, tests or measurements to regulate the
same or similar matters. All such limitations, tests and measurements
are, however, cumulative and are to be performed in accordance with the
terms thereof.
(l) This Credit Agreement and the other Loan Documents are the
result of negotiation among, and have been reviewed by counsel to, among
others, the Administrative Agent and the Borrower and are the product of
discussions and negotiations among all parties. Accordingly, this Credit
Agreement and the other Loan Documents are not intended to be construed
against the Administrative Agent or any of
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the Lenders merely on account of the Administrative Agent's or any
Lender's involvement in the preparation of such documents.
2. THE REVOLVING CREDIT FACILITY.
2.1. COMMITMENT TO LEND. Subject to the terms and conditions set forth
in this Credit Agreement, each of the Lenders severally agrees to lend to the
Borrower and the Borrower may borrow, repay, and reborrow from time to time from
the Closing Date up to but not including the Revolving Credit Loan Maturity Date
upon notice by the Borrower to the Administrative Agent given in accordance with
Section 2.6, such sums as are requested by the Borrower up to a maximum
aggregate amount outstanding (after giving effect to all amounts requested) at
any one time equal to such Lender's Commitment minus such Lender's Commitment
Percentage of the sum of the Maximum Drawing Amount and all Unpaid Reimbursement
Obligations, provided that the sum of the outstanding amount of the Revolving
Credit Loans (after giving effect to all amounts requested) plus the Maximum
Drawing Amount and all Unpaid Reimbursement Obligations shall not at any time
exceed the Total Commitment at such time. The Revolving Credit Loans shall be
made pro rata in accordance with each Lender's Commitment Percentage. Each
request for a Revolving Credit Loan hereunder shall constitute a representation
and warranty by the Borrower that the conditions set forth in Section 12 and
Section 13, in the case of the initial Revolving Credit Loans to be made on the
Closing Date, and Section 13, in the case of all other Revolving Credit Loans,
have been satisfied on the date of such request.
2.2. COMMITMENT FEE. The Borrower agrees to pay to the Administrative
Agent for the accounts of the Lenders in accordance with their respective
Commitment Percentages a commitment fee (the "Commitment Fee") calculated at the
rate of three-quarters of one percent (.75%) per annum on the average daily
amount during each calendar quarter or portion thereof from the date hereof, to
the Revolving Credit Loan Maturity Date by which the Total Commitment minus the
sum of the Maximum Drawing Amount and all Unpaid Reimbursement Obligations
exceeds the outstanding amount of Revolving Credit Loans during such calendar
quarter. The Commitment Fee shall be payable quarterly in arrears on the first
day of each calendar quarter for the immediately preceding calendar quarter
commencing on the first such date following the date hereof, with a final
payment on the Revolving Credit Loan Maturity Date or any earlier date on which
the Commitments shall terminate.
2.3. REDUCTION OF TOTAL COMMITMENT. The Borrower shall have the right at
any time and from time to time upon five (5) Business Days prior written notice
to the Administrative Agent to reduce by $1,000,000 or an integral multiple of
$500,000 in excess thereof or to terminate entirely the Total Commitment,
whereupon the Commitments of the Lenders shall be reduced pro rata in accordance
with their respective Commitment Percentages of the amount specified in such
notice or, as the case may be, terminated. Promptly after receiving any notice
of the Borrower delivered pursuant to this Section 2.3, the Administrative Agent
will notify the Lenders of the substance thereof. Upon the effective date of any
such reduction or termination, the Borrower shall pay to the Administrative
Agent for the respective accounts of the Lenders the full amount of any
Commitment Fee then accrued on the amount of the reduction. No reduction or
termination of the Commitments may be reinstated.
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2.4. THE REVOLVING CREDIT NOTES. The Revolving Credit Loans shall be
evidenced by separate promissory notes of the Borrower in substantially the form
of Exhibit A hereto (each a "Revolving Credit Note"), dated as of the Closing
Date (or such other date on which a Lender may become a party hereto in
accordance with Section 16 hereof) and completed with appropriate insertions.
One Revolving Credit Note shall be payable to the order of each Lender in a
principal amount equal to such Lender's Commitment or, if less, the outstanding
amount of all Revolving Credit Loans made by such Lender, plus interest accrued
thereon, as set forth below. The Borrower irrevocably authorize each Lender to
make or cause to be made, at or about the time of the Drawdown Date of any
Revolving Credit Loan or at the time of receipt of any payment of principal on
such Lender's Revolving Credit Note, an appropriate notation on such Lender's
Revolving Credit Note Record reflecting the making of such Revolving Credit Loan
or (as the case may be) the receipt of such payment. The outstanding amount of
the Revolving Credit Loans set forth on such Lender's Revolving Credit Note
Record shall be prima facie evidence of the principal amount thereof owing and
unpaid to such Lender, but the failure to record, or any error in so recording,
any such amount on such Lender's Revolving Credit Note Record shall not limit or
otherwise affect the obligations of the Borrower hereunder or under any
Revolving Credit Note to make payments of principal of or interest on any
Revolving Credit Note when due.
2.5. INTEREST ON REVOLVING CREDIT LOANS. Except as otherwise provided in
Section 6.10,
(a) Each Revolving Credit Loan which is a Base Rate Loan shall
bear interest for the period commencing with the Drawdown Date thereof
and ending on the last day of the Interest Period with respect thereto
at the rate per annum equal to the Base Rate plus the Applicable Margin
with respect to Base Rate Loans as in effect from time to time.
(b) Each Revolving Credit Loan which is a Eurodollar Rate Loan
shall bear interest for the period commencing with the Drawdown Date
thereof and ending on the last day of the Interest Period with respect
thereto at the rate per annum equal to the Eurodollar Rate determined
for such Interest Period plus the Applicable Margin with respect to
Eurodollar Rate Loans as in effect from time to time.
(c) The Borrower promises to pay interest on each Revolving
Credit Loan in arrears on each Interest Payment Date with respect
thereto.
2.6. REQUESTS FOR REVOLVING CREDIT LOANS.
The Borrower shall give to the Administrative Agent written
notice in the form of Exhibit B hereto (or telephonic notice confirmed
in a writing in the form of Exhibit B hereto) of each Revolving Credit
Loan requested hereunder (a "Loan Request") no less than (a) prior to
1:00 p.m. (Boston time) on the proposed Drawdown Date of any Base Rate
Loan and (b) prior to 1:00 p.m. (Boston time) on the third Eurodollar
Business Day prior to the proposed Drawdown Date of any Eurodollar Rate
Loan. Each such notice shall specify (i) the principal amount of the
Revolving Credit Loan requested, (ii) the proposed Drawdown Date of such
Revolving Credit Loan, (iii) the Interest Period for such Revolving
Credit Loan and (iv) the Type of such Revolving Credit Loan. Promptly
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upon receipt of any such notice, the Administrative Agent shall notify
each of the Lenders thereof. Each Loan Request shall be irrevocable and
binding on the Borrower and shall obligate the Borrower to accept the
Revolving Credit Loan requested from the Lenders on the proposed
Drawdown Date. Each Loan Request shall be in a minimum aggregate amount
of $500,000 or an integral multiple of $250,000 in excess thereof.
2.7. CONVERSION OPTIONS.
2.7.1. CONVERSION TO DIFFERENT TYPE OF REVOLVING CREDIT LOAN.
The Borrower may elect from time to time to convert any outstanding
Revolving Credit Loan to a Revolving Credit Loan of another Type,
provided that (a) with respect to any such conversion of a Eurodollar
Rate Loan to a Base Rate Loan, the Borrower shall give the
Administrative Agent at least one (1) Business Day prior written notice
of such election; (b) with respect to any such conversion of a Base Rate
Loan to a Eurodollar Rate Loan, the Borrower shall give the
Administrative Agent at least three (3) Eurodollar Business Days prior
written notice of such election; (c) with respect to any such conversion
of a Eurodollar Rate Loan into a Base Rate Loan, such conversion shall
only be made on the last day of the Interest Period with respect thereto
and (d) no Revolving Credit Loan may be converted into a Eurodollar Rate
Loan when any Default or Event of Default has occurred and is
continuing. Promptly upon receipt of any such notice, the Administrative
Agent shall notify each of the Lenders thereof. On the date on which
such conversion is being made each Lender shall take such action as is
necessary to transfer its Commitment Percentage of such Revolving Credit
Loans to its Domestic Lending Office or its Eurodollar Lending Office,
as the case may be. All or any part of outstanding Revolving Credit
Loans of any Type may be converted into a Revolving Credit Loan of
another Type as provided herein, provided that any partial conversion
shall be in an aggregate principal amount of $500,000 or a whole
multiple of $250,000 in excess thereof. Each Conversion Request relating
to the conversion of a Revolving Credit Loan to a Eurodollar Rate Loan
shall be irrevocable by the Borrower.
2.7.2. CONTINUATION OF TYPE OF REVOLVING CREDIT LOAN. Any
Revolving Credit Loan of any Type may be continued as a Revolving Credit
Loan of the same Type upon the expiration of an Interest Period with
respect thereto by compliance by the Borrower with the notice provisions
contained in Section 2.7.1; provided that no Eurodollar Rate Loan may be
continued as such when any Default or Event of Default has occurred and
is continuing, but shall be automatically converted to a Base Rate Loan
on the last day of the first Interest Period relating thereto ending
during the continuance of any Default or Event of Default of which
officers of the Administrative Agent active upon the Borrower's account
have actual knowledge. In the event that the Borrower fails to provide
any such notice with respect to the continuation of any Eurodollar Rate
Loan as such, then such Eurodollar Rate Loan shall be automatically
converted to a Base Rate Loan on the last day of the first Interest
Period relating thereto. The Administrative Agent shall notify the
Lenders promptly when any such automatic conversion contemplated by this
Section 2.7 is scheduled to occur.
2.7.3. EURODOLLAR RATE LOANS. Any conversion to or from
Eurodollar Rate Loans shall be in such amounts and be made pursuant to
such elections so that, after giving
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effect thereto, the aggregate principal amount of all Revolving Credit
Loans that are Eurodollar Rate Loans having the same Interest Period
shall not be less than $500,000 or a whole multiple of $250,000 in
excess thereof. No more than three (3) Revolving Credit Loans that are
Eurodollar Rate Loans having different Interest Periods may be
outstanding at any time.
2.8. FUNDS FOR REVOLVING CREDIT LOAN.
2.8.1. FUNDING PROCEDURES. Not later than 2:00 p.m. (Boston
time) on the proposed Drawdown Date of any Revolving Credit Loans, each
of the Lenders will make available to the Administrative Agent, at the
Administrative Agent's Office, in immediately available funds, the
amount of such Lender's Commitment Percentage of the amount of the
requested Revolving Credit Loans. Upon receipt from each Lender of such
amount, and upon receipt of the documents required by Sections 12 and 13
and the satisfaction of the other conditions set forth therein, to the
extent applicable, the Administrative Agent will make available to the
Borrower the aggregate amount of such Revolving Credit Loans made
available to the Administrative Agent by the Lenders. The failure or
refusal of any Lender to make available to the Administrative Agent at
the aforesaid time and place on any Drawdown Date the amount of its
Commitment Percentage of the requested Revolving Credit Loans shall not
relieve any other Lender from its several obligation hereunder to make
available to the Administrative Agent the amount of such other Lender's
Commitment Percentage of any requested Revolving Credit Loans.
2.8.2. ADVANCES BY ADMINISTRATIVE AGENT. The Administrative
Agent may, unless notified to the contrary by any Lender prior to a
Drawdown Date, assume that such Lender has made available to the
Administrative Agent on such Drawdown Date the amount of such Lender's
Commitment Percentage of the Revolving Credit Loans to be made on such
Drawdown Date, and the Administrative Agent may (but it shall not be
required to), in reliance upon such assumption, make available to the
Borrower a corresponding amount. If any Lender makes available to the
Administrative Agent such amount on a date after such Drawdown Date,
such Lender shall pay to the Administrative Agent on demand an amount
equal to the product of (a) the average computed for the period referred
to in clause (c) below, of the weighted average interest rate paid by
the Administrative Agent for federal funds acquired by the
Administrative Agent during each day included in such period, times (b)
the amount of such Lender's Commitment Percentage of such Revolving
Credit Loans, times (c) a fraction, the numerator of which is the number
of days that elapse from and including such Drawdown Date to the date on
which the amount of such Lender's Commitment Percentage of such
Revolving Credit Loans shall become immediately available to the
Administrative Agent, and the denominator of which is 360. A statement
of the Administrative Agent submitted to such Lender with respect to any
amounts owing under this paragraph shall be prima facie evidence of the
amount due and owing to the Administrative Agent by such Lender. If the
amount of such Lender's Commitment Percentage of such Revolving Credit
Loans is not made available to the Administrative Agent by such Lender
within three (3) Business Days following such Drawdown Date, the
Administrative Agent shall be entitled to recover such amount from the
Borrower on
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demand, with interest thereon at the rate per annum applicable to the
Revolving Credit Loans made on such Drawdown Date.
3. REPAYMENT OF THE REVOLVING CREDIT LOANS.
3.1. MATURITY. The Borrower promises to pay on the Revolving Credit Loan
Maturity Date, and there shall become absolutely due and payable on the
Revolving Credit Loan Maturity Date, all of the Revolving Credit Loans
outstanding on such date, together with any and all accrued and unpaid interest
thereon.
3.2. MANDATORY REPAYMENTS OF REVOLVING CREDIT LOANS. If at any time the
sum of the outstanding amount of the Revolving Credit Loans, the Maximum Drawing
Amount and all Unpaid Reimbursement Obligations exceeds the Total Commitment at
such time, then the Borrower shall immediately pay the amount of such excess to
the Administrative Agent for the respective accounts of the Lenders for
application: first, to any Unpaid Reimbursement Obligations; second, to the
Revolving Credit Loans; and third, to provide to the Administrative Agent cash
collateral for Reimbursement Obligations as contemplated by Section 5.2(b) and
(c). Each payment of any Unpaid Reimbursement Obligations or prepayment of
Revolving Credit Loans shall be allocated among the Lenders, in proportion, as
nearly as practicable, to each Reimbursement Obligation or (as the case may be)
the respective unpaid principal amount of each Lender's Revolving Credit Note,
with adjustments to the extent practicable to equalize any prior payments or
repayments not exactly in proportion. In addition, the Borrower shall repay the
Revolving Credit Loans in accordance with Section 4.3.
3.3. OPTIONAL REPAYMENTS OF REVOLVING CREDIT LOANS. The Borrower shall
have the right, at its election, to repay the outstanding amount of the
Revolving Credit Loans, as a whole or in part, at any time without penalty or
premium, provided that any full or partial prepayment of the outstanding amount
of any Eurodollar Rate Loans pursuant to this Section 3.3 that is not made on
the last day of the Interest Period relating thereto shall be accompanied by any
amounts due under Section 6.9 hereof. The Borrower shall give the Administrative
Agent, no later than 1:00 p.m., Boston time, on the date of any proposed
prepayment, prior written notice of any proposed prepayment pursuant to this
Section 3.3 of Base Rate Loans, and no later than 1:00 p.m., Boston time, two
(2) Eurodollar Business Days notice of any proposed prepayment pursuant to this
Section 3.3 of Eurodollar Rate Loans, in each case specifying the proposed date
of prepayment of Revolving Credit Loans and the principal amount to be prepaid.
Each such partial prepayment of the Revolving Credit Loans shall be in an
integral multiple of $100,000, shall be accompanied by the payment of accrued
interest on the principal prepaid to the date of prepayment and shall be
applied, in the absence of instruction by the Borrower, first to the principal
of Base Rate Loans and then to the principal of Eurodollar Rate Loans. Each
partial prepayment shall be allocated among the Lenders, in proportion, as
nearly as practicable, to the respective unpaid principal amount of each
Lender's Revolving Credit Note, with adjustments to the extent practicable to
equalize any prior repayments not exactly in proportion.
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4. THE TERM LOAN.
4.1. COMMITMENT TO LEND. Subject to the terms and conditions set forth
in this Credit Agreement, each Lender agrees to lend to the Borrower on the
Closing Date the amount of its Commitment Percentage of the principal amount of
$25,000,000.
4.2. THE TERM NOTES. The Term Loan shall be evidenced by separate
promissory notes of the Borrower in substantially the form of Exhibit C hereto
(each a "Term Note"), dated the Closing Date (or such other date on which a
Lender may become a party hereto in accordance with Section 16 hereof) and
completed with appropriate insertions. One Term Note shall be payable to the
order of each Lender in a principal amount equal to such Lender's Commitment
Percentage of the Term Loan and representing the joint and several obligation of
the Borrower to pay to such Lender such principal amount or, if less, the
outstanding amount of such Lender's Commitment Percentage of the Term Loan, plus
interest accrued thereon, as set forth below. The Borrower irrevocably
authorizes each Lender to make or cause to be made a notation on such Lender's
Term Note Record reflecting the original principal amount of such Lender's
Commitment Percentage of the Term Loan and, at or about the time of such
Lender's receipt of any principal payment on such Lender's Term Note, an
appropriate notation on such Lender's Term Note Record reflecting such payment.
The aggregate unpaid amount set forth on such Lender's Term Note Record shall be
prima facie evidence of the principal amount thereof owing and unpaid to such
Lender, but the failure to record, or any error in so recording, any such amount
on such Lender's Term Note Record shall not affect the obligations of the
Borrower hereunder or under any Term Note to make payments of principal of and
interest on any Term Note when due.
4.3. MANDATORY PREPAYMENT OF TERM LOANS.
4.3.1. SCHEDULE OF INSTALLMENT PAYMENTS OF PRINCIPAL OF TERM
LOAN. The Borrower promises to pay to the Administrative Agent for the
account of the Lenders the principal amount of the Term Loan in
twenty-two consecutive quarterly payments in an amount equal to the
amount set forth in the table below opposite the date of such payment,
such payments to be due and payable on the last day of each calendar
quarter of each calendar year ending within any period set forth below
in the table in the amount set forth opposite such period in the table
below, commencing on December 31, 2001, with a final payment on the Term
Loan Maturity Date in an amount equal to the unpaid balance of the Term
Loan.
---------------------------------- ----------------------------------
QUARTER ENDING AMOUNT OF PAYMENT
---------------------------------- ----------------------------------
12/31/01 $1,000,000
3/31/02 $1,000,000
6/30/02 $1,000,000
9/30/02 $1,000,000
12/31/02 $1,000,000
3/31/03 $1,000,000
6/30/03 $1,125,000
---------------------------------- ----------------------------------
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---------------------------------- ----------------------------------
QUARTER ENDING AMOUNT OF PAYMENT
---------------------------------- ----------------------------------
9/30/03 $1,125,000
12/31/03 $1,125,000
3/31/04 $1,125,000
6/30/04 $1,125,000
9/30/04 $1,125,000
12/31/04 $1,125,000
3/31/05 $1,125,000
6/30/05 $1,250,000
9/30/05 $1,250,000
12/31/05 $1,250,000
3/31/06 $1,250,000
6/30/06 $1,250,000
9/30/06 $1,250,000
12/31/06 $1,250,000
Term Loan Maturity Date $1,250,000
---------------------------------- ----------------------------------
4.3.2. EXCESS CASH FLOW RECAPTURE. For each fiscal year of the
Borrower, commencing with the fiscal year ended nearest December 31,
2002, the Borrower shall prepay the principal of the Term Loan or, in
the event that the Term Loan is paid in full, permanently reduce the
Total Revolving Credit Commitment in accordance with Section 4.3.4 below
in an aggregate amount equal to the Applicable Excess Cash Flow
Percentage of the amount of Consolidated Excess Operating Cash Flow for
such fiscal year, such mandatory prepayment to be due and payable one
hundred twenty (120) days after the end of each applicable fiscal year,
such mandatory prepayment to be based on a certificate of the Borrower
delivered to the Administrative Agent demonstrating the calculation of
Consolidated Excess Operating Cash Flow, such certificate to be
reasonably acceptable to the Administrative Agent.
4.3.3. PROCEEDS OF CERTAIN EVENTS. Concurrently with the receipt
by the Borrower or any Subsidiary of:
(a) Subject to the reinvestment provisions of Section
10.5.2, Net Cash Sale Proceeds in excess of $500,000 per annum
from Asset Sales (other than the sale, lease, license or other
disposition of assets in the ordinary course of business
consistent with past practices) or Sale-Leasebacks, provided,
however, that, the Net Cash Sale Proceeds received by the
Borrower in respect of the sales of the Stores located in
Atlanta, Georgia and Scottsdale, Arizona, shall only be required
to be repaid pursuant to this 4.3.3(a) to the extent that such
Net Cash Sale Proceeds are not reinvested in such Stores;
(b) Net Cash Equity Issuance Proceeds of the Borrower or
any of its Subsidiaries; (excluding (i) any such sale or
issuance to its existing shareholders other than in connection
with a public offering of the equity securities of such Person,
and (ii) the sale or issuance to any employee or director of
such Person pursuant to any stock option plan approved by the
board of directors of such
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Person in the ordinary course of business, provided, however,
that such sales or issuances described in (i) and (ii) shall not
exceed $500,000 in the aggregate);
(c) Net Cash Debt Issuance Proceeds of the Borrower or
any of its Subsidiaries; or
(d) proceeds in excess of $500,000 in the aggregate
received from Casualty Events by the Borrower or any of its
Subsidiaries which have not been committed (as evidenced by a
binding written contract) by the Borrower or such Subsidiary
within two hundred seventy (270) days of receipt of such
proceeds to the repair or replacement of the property so
damaged, destroyed or taken, or, if so committed, such repair or
replacement of the property so damaged, destroyed or taken shall
have not commenced within two hundred seventy (270) days of
receipt of such proceeds pursuant to such binding written
contract (provided, however, if a Default or Event of Default
has occurred and is continuing, such proceeds shall be
immediately paid to the Administrative Agent);
the Borrower shall pay to the Administrative Agent for the respective
accounts of the Lenders an amount equal to one hundred percent (100%) of
such proceeds, to be applied in the manner set forth in Section 4.3.4.
4.3.4. APPLICATION OF PAYMENTS. All payments made pursuant to
Section 4.3.2 or Section 4.3.3 shall be applied first against the
remaining scheduled installments of principal on the Term Loan in the
inverse order of maturity and, if there are no outstanding amounts owed
on the Term Loan, then to reduce the outstanding amount of the Revolving
Credit Loans and to permanently reduce the Total Commitment by such
amount. Such mandatory prepayments shall be allocated among the Lenders
in proportion, as nearly as practicable, to the respective outstanding
amounts of each Lender's Notes, with adjustments to the extent
practicable to equalize any prior prepayments not exactly in proportion.
No amounts repaid pursuant to this Section 4.3 may be reborrowed.
4.4. OPTIONAL PREPAYMENT OF TERM LOAN. The Borrower shall have the right
at any time to prepay the Term Notes on or before the Term Loan Maturity Date,
as a whole, or in part, upon not less than five (5) Business Days prior written
notice to the Administrative Agent, without premium or penalty, provided that
(a) each partial prepayment shall be in the principal amount of $100,000 or an
integral multiple thereof, (b) no portion of the Term Loan bearing interest at
the Eurodollar Rate may be prepaid pursuant to this Section 4.4 except on the
last day of the Interest Period relating thereto, unless accompanied by any
amounts due under Section 6.10 and (c) each partial prepayment shall be
allocated among the Lenders, in proportion, as nearly as practicable, to the
respective outstanding amount of each Lender's Term Note, with adjustments to
the extent practicable to equalize any prior prepayments not exactly in
proportion. Promptly upon receipt of any such notice, the Administrative Agent
shall notify each of the Lenders thereof. Any prepayment of principal of the
Term Loan shall include all interest accrued to the date of prepayment and shall
be applied against the scheduled installments of principal due on the Term Loan
in the inverse order of maturity. No amount repaid with respect to the Term Loan
may be reborrowed.
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4.5. INTEREST ON TERM LOAN.
4.5.1. INTEREST RATES. Except as otherwise provided in Section
6.11, the Term Loan shall bear interest during each Interest Period
relating to all or any portion of the Term Loan at the following rates:
(a) To the extent that all or any portion of the Term
Loan is a Base Rate Loan, the Term Loan or such portion shall
bear interest during such Interest Period at the rate per annum
equal to the Base Rate plus the Applicable Margin with respect
to Base Rate Loans as in effect from time to time.
(b) To the extent that all or any portion of the Term
Loan is a Eurodollar Rate Loan, the Term Loan or such portion
shall bear interest during such Interest Period at the rate per
annum equal to the Eurodollar Rate determined for such Interest
Period plus the Applicable Margin with respect to Eurodollar
Rate Loans as in effect from time to time.
(c) The Borrower promises to pay interest on the Term
Loan or any portion thereof outstanding during each Interest
Period in arrears on each Interest Payment Date applicable to
such Interest Period.
4.5.2. NOTIFICATION BY BORROWER. The Borrower shall notify the
Administrative Agent, such notice to be irrevocable, at least three (3)
Eurodollar Business Days prior to the Drawdown Date of the Term Loan if
all or any portion of the Term Loan is to bear interest at the
Eurodollar Rate. Promptly upon receipt of any such notice, the
Administrative Agent shall notify each of the Lenders thereof. After the
Term Loan has been made, the provisions of Section 2.7 shall apply
mutatis mutandis with respect to all or any portion of the Term Loan so
that the Borrower may have the same interest rate options with respect
to all or any portion of the Term Loan as it would be entitled to with
respect to the Revolving Credit Loans.
4.5.3. AMOUNTS, ETC. Any portion of the Term Loan bearing
interest at the Eurodollar Rate relating to any Interest Period shall be
in the amount of $500,000 or an integral multiple thereof. No Interest
Period relating to the Term Loan or any portion thereof bearing interest
at the Eurodollar Rate shall extend beyond the date on which a regularly
scheduled installment payment of the principal of the Term Loan is to be
made unless a portion of the Term Loan at least equal to such
installment payment has an Interest Period ending on such date or is
then bearing interest at the Base Rate. No more than three (3) portions
of the Term Loan which are Eurodollar Rate Loans having different
Interest Periods may be outstanding at any time.
5. LETTERS OF CREDIT.
5.1. LETTER OF CREDIT COMMITMENTS.
5.1.1. COMMITMENT TO ISSUE LETTERS OF CREDIT. Subject to the
terms and conditions hereof and the execution and delivery by the
Borrower of a letter of credit
40
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application on the Administrative Agent's customary form (a "Letter of
Credit Application"), the Administrative Agent on behalf of the Lenders
and in reliance upon the agreement of the Lenders set forth in Section
5.1.4 and upon the representations and warranties of the Borrower
contained herein, agrees, in its individual capacity, to issue, extend
and renew for the account of the Borrower one or more standby or
documentary letters of credit (individually, a "Letter of Credit"), in
such form as may be requested from time to time by the Borrower and
agreed to by the Administrative Agent; provided, however, that, after
giving effect to such request, (a) the sum of the aggregate Maximum
Drawing Amount and all Unpaid Reimbursement Obligations shall not exceed
$5,000,000 at any one time and (b) the sum of (i) the Maximum Drawing
Amount on all Letters of Credit, (ii) all Unpaid Reimbursement
Obligations, and (iii) the amount of all Revolving Credit Loans
outstanding shall not exceed the Total Commitment at such time.
5.1.2. LETTER OF CREDIT APPLICATIONS. Each Letter of Credit
Application shall be completed to the satisfaction of the Administrative
Agent. In the event that any provision of any Letter of Credit
Application shall be inconsistent with any provision of this Credit
Agreement, then the provisions of this Credit Agreement shall, to the
extent of any such inconsistency, govern.
5.1.3. TERMS OF LETTERS OF CREDIT. Each Letter of Credit issued,
extended or renewed hereunder shall, among other things, (a) provide for
the payment of sight drafts for honor thereunder when presented in
accordance with the terms thereof and when accompanied by the documents
described therein, and (b) have an expiry date no later than the date
which is the earlier of (i) twelve (12) months after the date of
issuance (which may incorporate automatic renewals for periods of up to
twelve (12) months), or (ii) fourteen (14) days (or, if the Letter of
Credit is confirmed by a confirmer or otherwise provides for one or more
nominated persons, forty-five (45) days) prior to the Revolving Credit
Loan Maturity Date. Each Letter of Credit so issued, extended or renewed
shall be subject to the Uniform Customs and Practice for Documentary
Credits (1993 Revision), International Chamber of Commerce Publication
No. 500 or any successor version thereto adopted by the Administrative
Agent in the ordinary course of its business as a letter of credit
issuer and in effect at the time of issuance of such Letter of Credit
(the "Uniform Customs") or, in the case of a standby Letter of Credit,
either the Uniform Customs or the International Standby Practices
(ISP98), International Chamber of Commerce Publication No. 590, or any
successor code of standby letter of credit practices among banks adopted
by the Administrative Agent in the ordinary course of its business as a
standby letter of credit issuer and in effect at the time of issuance of
such Letter of Credit.
5.1.4. REIMBURSEMENT OBLIGATIONS OF LENDERS. Each Lender
severally agrees that it shall be absolutely liable, without regard to
the occurrence of any Default or Event of Default or any other condition
precedent whatsoever, to the extent of such Lender's Commitment
Percentage, to reimburse the Administrative Agent on demand for the
amount of each draft paid by the Administrative Agent under each Letter
of Credit to the extent that such amount is not reimbursed by the
Borrower pursuant to
41
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Section 5.2 (such agreement for a Lender being called herein the "Letter
of Credit Participation" of such Lender).
5.1.5. PARTICIPATIONS OF LENDERS. Each such payment made by a
Lender shall be treated as the purchase by such Lender of a
participating interest in the Borrower's Reimbursement Obligation under
Section 5.2 in an amount equal to such payment. Each Lender shall share
in accordance with its participating interest in any interest which
accrues pursuant to Section 5.2.
5.2. REIMBURSEMENT OBLIGATION OF THE BORROWER. In order to induce the
Administrative Agent to issue, extend and renew each Letter of Credit and the
Lenders to participate therein, the Borrower hereby agrees to reimburse or pay
to the Administrative Agent, for the account of the Administrative Agent or (as
the case may be) the Lenders, with respect to each Letter of Credit issued,
extended or renewed by the Administrative Agent hereunder,
(a) except as otherwise expressly provided in Section 5.2(b) and
(c), on each date that any draft presented under such Letter of Credit
is honored by the Administrative Agent, or the Administrative Agent
otherwise makes a payment with respect thereto, (i) the amount paid by
the Administrative Agent under or with respect to such Letter of Credit,
and (ii) the amount of any taxes, fees, charges or other costs and
expenses whatsoever incurred by the Administrative Agent or any Lender
in connection with any payment made by the Administrative Agent or any
Lender under, or with respect to, such Letter of Credit,
(b) upon the reduction (but not termination) of the Total
Commitment to an amount less than the Maximum Drawing Amount, an amount
equal to such difference, which amount shall be held by the
Administrative Agent for the benefit of the Lenders and the
Administrative Agent as cash collateral for all Reimbursement
Obligations, and
(c) upon the termination of the Total Commitment, or the
acceleration of the Reimbursement Obligations with respect to all
Letters of Credit in accordance with Section 14, an amount equal to the
then Maximum Drawing Amount on all Letters of Credit, which amount shall
be held by the Administrative Agent for the benefit of the Lenders and
the Administrative Agent as cash collateral for all Reimbursement
Obligations.
Each such payment shall be made to the Administrative Agent at the
Administrative Agent's Office in immediately available funds. Interest on any
and all amounts remaining unpaid by the Borrower under this Section 5.2 at any
time from the date such amounts become due and payable (whether as stated in
this Section 5.2, by acceleration or otherwise) until payment in full (whether
before or after judgment) shall be payable to the Administrative Agent on demand
at the rate specified in Section 6.11 for overdue principal on the Revolving
Credit Loans.
5.3. LETTER OF CREDIT PAYMENTS. If any draft shall be presented or other
demand for payment shall be made under any Letter of Credit, the Administrative
Agent shall notify the Borrower of the date and amount of the draft presented or
demand for payment and of the date and time when it expects to pay such draft or
honor such demand for payment. If the Borrower
42
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fails to reimburse the Administrative Agent as provided in Section 5.2 on or
before the date that such draft is paid or other payment is made by the
Administrative Agent, the Administrative Agent may at any time thereafter notify
the Lenders of the amount of any such Unpaid Reimbursement Obligation. No later
than 3:00 p.m. (Boston time) on the Business Day next following the receipt of
such notice, each Lender shall make available to the Administrative Agent, at
the Administrative Agent's Office, in immediately available funds, such Lender's
Commitment Percentage of such Unpaid Reimbursement Obligation, together with an
amount equal to the product of (a) the average, computed for the period referred
to in clause (c) below, of the weighted average interest rate paid by the
Administrative Agent for federal funds acquired by the Administrative Agent
during each day included in such period, times (b) the amount equal to such
Lender's Commitment Percentage of such Unpaid Reimbursement Obligation, times
(c) a fraction, the numerator of which is the number of days that elapse from
and including the date the Administrative Agent paid the draft presented for
honor or otherwise made payment to the date on which such Lender's Commitment
Percentage of such Unpaid Reimbursement Obligation shall become immediately
available to the Administrative Agent, and the denominator of which is 360. The
responsibility of the Administrative Agent to the Borrower and the Lenders shall
be only to determine that the documents (including each draft) delivered under
each Letter of Credit in connection with such presentment shall be in conformity
in all material respects with such Letter of Credit.
5.4. OBLIGATIONS ABSOLUTE. The Borrower's obligations under this Section
5 shall be absolute and unconditional under any and all circumstances and
irrespective of the occurrence of any Default or Event of Default or any
condition precedent whatsoever or any setoff, counterclaim or defense to payment
which the Borrower may have or have had against the Administrative Agent, any
Lender or any beneficiary of a Letter of Credit, other than claims arising due
to the gross negligence or willful misconduct of the Administrative Agent or any
Lender. The Borrower further agrees with the Administrative Agent and the
Lenders that the Administrative Agent and the Lenders shall not be responsible
for, and the Borrower's Reimbursement Obligations under Section 5.2 shall not be
affected by, among other things, the validity or genuineness of documents or of
any endorsements thereon, even if such documents should in fact prove to be in
any or all respects invalid, fraudulent or forged, or any dispute between or
among the Borrower, the beneficiary of any Letter of Credit or any financing
institution or other party to which any Letter of Credit may be transferred or
any claims or defenses whatsoever of the Borrower against the beneficiary of any
Letter of Credit or any such transferee. The Administrative Agent and the
Lenders shall not be liable for any error, omission, interruption or delay in
transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Letter of Credit. The Borrower agrees that
any action taken or omitted by the Administrative Agent or any Lender under or
in connection with each Letter of Credit and the related drafts and documents,
if done in good faith, shall be binding upon the Borrower and shall not result
in any liability on the part of the Administrative Agent or any Lender to the
Borrower.
5.5. RELIANCE BY ISSUER. To the extent not inconsistent with Section
5.4, the Administrative Agent shall be entitled to rely, and shall be fully
protected in relying upon, any Letter of Credit, draft, writing, resolution,
notice, consent, certificate, affidavit, letter, cablegram, telegram, telecopy,
telex or teletype message, statement, order or other document believed by it to
be
43
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genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel, independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Credit Agreement unless it shall first have received such
advice or concurrence of the Required Lenders as it reasonably deems appropriate
or it shall first be indemnified to its reasonable satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Credit Agreement in accordance with a request of the Required Lenders, and
such request and any action taken or failure to act pursuant thereto shall be
binding upon the Lenders and all future holders of the Revolving Credit Notes or
of a Letter of Credit Participation.
5.6. LETTER OF CREDIT FEE. With respect to each Letter of Credit issued
hereunder, the Borrower shall pay to the Administrative Agent a fee (the "Letter
of Credit Fee") for each Letter of Credit issued or renewed by the
Administrative Agent at a rate per annum equal to the Applicable Margin with
respect to Eurodollar Rate Loans in effect from time to time, on the Maximum
Drawing Amount of such Letter of Credit for the period such Letter of Credit is
outstanding. The Administrative Agent shall, in turn, remit to each Lender
(including Fleet) such Lender's Commitment Percentage of the Letter of Credit
Fee. In addition, the Borrower will pay the Administrative Agent, for its own
account, a Fronting Fee (the "Fronting Fee") equal to one-eighth of one percent
(0.125%) per annum on the Maximum Drawing Amount of such Letter of Credit for
the period such Letter of Credit is outstanding. The Letter of Credit Fee and
the Fronting Fee shall be payable quarterly in arrears on the last day of each
calendar quarter for the calendar quarter then ending. In respect of each Letter
of Credit, the Borrower shall also pay to the Administrative Agent, for its own
account, at such time or times as such charges are customarily made by the
Administrative Agent, the Administrative Agent's customary issuance, amendment,
negotiation or document examination and other administrative fees as in effect
from time to time.
6. CERTAIN GENERAL PROVISIONS.
6.1. FEES. The Borrower agrees to pay to the Administrative Agent all
fees described in the Fee Letter in accordance with the terms thereof.
6.2. FUNDS FOR PAYMENTS.
6.2.1. PAYMENTS TO ADMINISTRATIVE AGENT. All payments of
principal, interest, Reimbursement Obligations, Fees and any other
amounts due hereunder or under any of the other Loan Documents shall be
made on the due date thereof to the Administrative Agent in Dollars, for
the respective accounts of the Lenders and the Administrative Agent, at
the Administrative Agent's Office or at such other place that the
Administrative Agent may from time to time designate, in each case at or
about 11:00 a.m. (Boston, Massachusetts, time or other local time at the
place of payment) and in immediately available funds.
44
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6.2.2. NO OFFSET, ETC. (a) Subject to Section 6.2.2(f), any and
all payments by the Borrower hereunder and under any of the other Loan
Documents shall be made without setoff or counterclaim and free and
clear of and without deduction or withholding for any Taxes. In
addition, the Borrower shall pay all Other Taxes.
(b) Subject to Section 6.2.2(f), the Borrower agrees to
indemnify and hold harmless each Lender and the Administrative Agent for
the full amount of Taxes or Other Taxes (including any Taxes or Other
Taxes imposed by any jurisdiction on amounts payable under this Section
6.2.2) paid by such Lender or the Administrative Agent and any liability
(including such penalties, interest, additions to tax and expenses)
arising therefrom or with respect thereto, whether or not such Taxes or
Other Taxes were correctly or legally asserted. Payment under this
indemnification shall be made within thirty (30) days after the date any
Lender (through the Administrative Agent) or the Administrative Agent
makes written demand thereof.
(c) If the Borrower shall be required by law to deduct or
withhold any Taxes or Other Taxes from or in respect of any sum payable
hereunder to any Lender or the Administrative Agent, then, subject to
Section 6.2.2(f):
(i) the sum payable shall be increased as necessary so
that after making all required deductions and withholdings
(including deductions and withholdings applicable to additional
sums payable under this Section 6.2.2) such Lender or the
Administrative Agent, as the case may be, receives an amount
equal to the sum it would have received had no such deductions
or withholdings been made;
(ii) the Borrower shall make such deductions and
withholdings;
(iii) the Borrower shall pay the full amount deducted or
withheld to the relevant taxing authority or other authority in
accordance with applicable law; and
(iv) the Borrower shall also pay to such Lender or the
Administrative Agent for the account of such Lender, at the time
interest is paid, all additional amounts which the respective
Lender specifies as necessary to preserve the after-tax yield
such Lender would have received if such Taxes or Other Taxes had
not been imposed.
(d) Within thirty (30) days after the date of any payment by the
Borrower of Taxes or Other Taxes, the Borrower shall furnish the
Administrative Agent the original or a certified copy of a receipt
evidencing payment thereof, or other evidence of payment reasonably
satisfactory to the Administrative Agent.
(e) If the Borrower is required to pay additional amounts to any
Lender or the Administrative Agent pursuant to subsection (b) or (c) of
this Section 6.2.2, then such Lender shall use commercially reasonable
efforts (consistent with legal and regulatory
45
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restrictions) to change the jurisdiction of its lending office so as to
eliminate any such additional payment by the Borrower which may
thereafter accrue, if such change in the judgment of such Lender is not
otherwise disadvantageous to such Lender.
(f) No Borrower shall be obligated to indemnify any Lender or
the Administrative Agent pursuant to Section 6.2.2(b) or gross up any
payments to any Lender or the Administrative Agent pursuant to Section
6.2.2(c) in respect of United States federal withholding taxes to the
extent such Lender or the Administrative Agent is organized under the
laws of a jurisdiction outside the United States and to the extent
imposed as a result of (i) the failure of such Lender or the
Administrative Agent to deliver the relevant form or forms prescribed by
the Internal Revenue Service of the United States referred to in Section
16.2(i) if the Administrative Agent or such Lender is entitled under the
Code to deliver such forms, (ii) the information or certifications made
in such forms being untrue or inaccurate on the date delivered or such
form or forms not establishing a complete exemption for United States
withholding taxes (excepting by reason of a change in United States tax
laws or regulations occurring after the Closing Date) or (iii) such
Lender or the Administrative Agent designating a successor lending
office which has the effect of causing such Lender or Administrative
Agent to become obligated for tax payments (or being subject to added
United States federal withholding taxes) in excess of those in effect
immediately prior to such designation, unless such designation is made
at the request of the Borrower.
(g) If a Lender or the Administrative Agent receives the benefit
of a refund or credit which it determines in its sole discretion is
attributable to any Taxes or Other Taxes as to which it has been
indemnified by the Borrower, or with respect to which the Borrower has
paid increased amounts hereunder, it shall within thirty (30) days after
the date of such receipt pay over the amount of such refund or credit
(to the extent so attributable) to the Borrower, net of all reasonable
out-of-pocket expenses of such Lender or the Administrative Agent
related to claiming such refund or credit; provided, however, that (i)
any Lender or the Administrative Agent may determine, in its sole
discretion consistent with the policies of such Lender or the
Administrative Agent, whether to seek such a refund or credit; (ii) any
Taxes or Other Taxes that are imposed on a Lender or the Administrative
Agent as a result of a disallowance or reduction (including through the
expiration of any tax credit carryover or carryback of such refund or
credit with respect to which such Lender or the Administrative Agent has
made a payment to the Borrower pursuant to this Section 6.2.2(g) shall
be treated as a Tax for which the Borrower is obligated to indemnify
such Lender or the Administrative Agent pursuant to this Section 6.2.2
without any setoff, counterclaims, exclusions or defenses; and (iii)
nothing in this Section 6.2.2(g) shall require the Lenders or the
Administrative Agent to disclose any confidential information to the
Borrower (including, without limitation, its tax returns).
6.3. COMPUTATIONS. All computations of interest on Base Rate Loans shall
be based on a 365-day year and the actual number of days elapsed. All
computations of interest on the Eurodollar Rate Loans and of Fees shall be based
on a 360-day year and paid for the actual number of days elapsed. Except as
otherwise provided in the definition of the term "Interest
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Period" with respect to Eurodollar Rate Loans, whenever a payment hereunder or
under any of the other Loan Documents becomes due on a day that is not a
Business Day, the due date for such payment shall be extended to the next
succeeding Business Day, and interest shall accrue during such extension. The
outstanding amount of the Loans as reflected on the Revolving Credit Note
Records and the Term Note Records from time to time shall be considered correct
and binding on the Borrower unless within five (5) Business Days after receipt
of any notice by the Administrative Agent or any of the Lenders of such
outstanding amount, the Administrative Agent or such Lender shall notify the
Borrower to the contrary.
6.4. INABILITY TO DETERMINE EURODOLLAR RATE. In the event, prior to the
commencement of any Interest Period relating to any Eurodollar Rate Loan, the
Administrative Agent shall determine or be notified by the Required Lenders that
adequate and reasonable methods do not exist for ascertaining the Eurodollar
Rate that would otherwise determine the rate of interest to be applicable to any
Eurodollar Rate Loan during any Interest Period, the Administrative Agent shall
forthwith give notice of such determination (which shall be conclusive and
binding on the Borrower and the Lenders) to the Borrower and the Lenders. In
such event (a) any Loan Request or Conversion Request with respect to Eurodollar
Rate Loans shall be automatically withdrawn and shall be deemed a request for
Base Rate Loans, (b) each Eurodollar Rate Loan will automatically, on the last
day of the then current Interest Period relating thereto, become a Base Rate
Loan, and (c) the obligations of the Lenders to make Eurodollar Rate Loans shall
be suspended until the Administrative Agent or the Required Lenders determine
that the circumstances giving rise to such suspension no longer exist, whereupon
the Administrative Agent or, as the case may be, the Administrative Agent upon
the instruction of the Required Lenders, shall so notify the Borrower and the
Lenders.
6.5. ILLEGALITY. Notwithstanding any other provisions herein, if any
present or future law, regulation, treaty or directive or in the interpretation
or application thereof shall make it unlawful for any Lender to make or maintain
Eurodollar Rate Loans, such Lender shall forthwith give notice of such
circumstances to the Borrower and the other Lenders and thereupon (a) the
commitment of such Lender to make Eurodollar Rate Loans or convert Base Rate
Loans to Eurodollar Rate Loans shall forthwith be suspended and (b) such
Lender's Revolving Credit Loans then outstanding as Eurodollar Rate Loans, if
any, shall be converted automatically to Base Rate Loans on the last day of each
Interest Period applicable to such Eurodollar Rate Loans or within such earlier
period as may be required by law. The Borrower hereby agree promptly to pay the
Administrative Agent for the account of such Lender, upon demand by such Lender,
any additional amounts necessary to compensate such Lender for any costs
incurred by such Lender in making any conversion in accordance with this Section
6.6, including any interest or fees payable by such Lender to lenders of funds
obtained by it in order to make or maintain its Eurodollar Rate Loans hereunder.
6.6. ADDITIONAL COSTS, ETC. If any future applicable law or any change
in interpretation of any present law, which expression, as used herein, includes
statutes, rules and regulations thereunder and interpretations thereof by any
competent court or by any governmental or other regulatory body or official
charged with the administration or the interpretation thereof and requests,
directives, instructions and notices at any time or from time to time hereafter
made
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upon or otherwise issued to any Lender or the Administrative Agent by any
central bank or other fiscal, monetary or other authority (whether or not having
the force of law), shall:
(a) subject any Lender or the Administrative Agent to any tax,
levy, impost, duty, charge, fee, deduction or withholding of any nature
with respect to this Credit Agreement, the other Loan Documents, any
Letters of Credit, such Lender's Commitment or the Loans (other than
taxes based upon or measured by the income or profits of such Lender or
the Administrative Agent and taxes covered by Section 6.2.2), or
(b) materially change the basis of taxation (except for changes
in taxes on income or profits) of payments to any Lender of the
principal of or the interest on any Loans or any other amounts payable
to any Lender or the Administrative Agent under this Credit Agreement or
any of the other Loan Documents, or
(c) impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Credit Agreement) any
special deposit, reserve, assessment, liquidity, capital adequacy or
other similar requirements (whether or not having the force of law)
against assets held by, or deposits in or for the account of, or loans
by, or letters of credit issued by, or commitments of an office of any
Lender, or
(d) impose on any Lender or the Administrative Agent any other
conditions or requirements with respect to this Credit Agreement, the
other Loan Documents, any Letters of Credit, the Loans, such Lender's
Commitment, or any class of loans, letters of credit or commitments of
which any of the Loans or such Lender's Commitment forms a part, and the
result of any of the foregoing is
(i) to increase the cost to any Lender of making, funding,
issuing, renewing, extending or maintaining any of the Loans or
such Lender's Commitment or any Letter of Credit, or
(ii) to reduce the amount of principal, interest,
Reimbursement Obligation or other amount payable to such Lender
or the Administrative Agent hereunder on account of such Lender's
Commitment, any Letter of Credit or any of the Loans, or
(iii) to require such Lender or the Administrative Agent
to make any payment or to forego any interest or Reimbursement
Obligation or other sum payable hereunder, the amount of which
payment or foregone interest or Reimbursement Obligation or other
sum is calculated by reference to the gross amount of any sum
receivable or deemed received by such Lender or the
Administrative Agent from the Borrower hereunder,
(e) Failure or delay on the part of any Lender to demand
compensation for any increased costs or reductions in amounts received
or receivable or reductions in return on capital shall not constitute a
waiver of such Lender's right to demand such compensation; provided that
the Borrower shall not be under any obligation to compensate any Lender
under this Section 6.6 with respect to increased costs or reductions
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with respect to any period prior to the date that is one year prior to
such request if such Lender knew or could reasonably have been expected
to know of the circumstances giving rise to such increased costs or
reductions and of the fact that such would in fact result in a claim for
increased compensation by reason of such increased costs or reductions;
provided, further that the foregoing limitation shall not apply to any
increased costs or reductions arising out of the retroactive application
of any law, regulation, rule, guideline or directive as aforesaid within
such one year period.
then, and in each such case, the Borrower will, upon demand made by such Lender
or (as the case may be) the Administrative Agent at any time and from time to
time and as often as the occasion therefor may arise, pay to such Lender or the
Administrative Agent such additional amounts as will be sufficient to compensate
such Lender or the Administrative Agent for such additional cost, reduction,
payment or foregone interest or Reimbursement Obligation or other sum.
6.7. CAPITAL ADEQUACY. (a) If after the date hereof any Lender or the
Administrative Agent determines that (i) the adoption of or change in any law,
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law) regarding capital requirements for Lenders or Lender
holding companies or any change in the interpretation or application thereof by
a Governmental Authority with appropriate jurisdiction, or (ii) compliance by
such Lender or the Administrative Agent or any corporation controlling such
Lender or the Administrative Agent with any law, governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law) of any
such entity regarding capital adequacy, has the effect of reducing the return on
such Lender's or the Administrative Agent's commitment with respect to any Loans
to a level below that which such Lender or the Administrative Agent could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender's or the Administrative Agent's then existing policies with respect
to capital adequacy and assuming full utilization of such entity's capital) by
any amount deemed by such Lender or (as the case may be) the Administrative
Agent to be material, then such Lender or the Administrative Agent may notify
the Borrower of such fact. To the extent that the amount of such reduction in
the return on capital is not reflected in the Base Rate, the Borrower agrees to
pay such Lender or (as the case may be) the Administrative Agent for the amount
of such reduction in the return on capital as and when such reduction is
determined upon presentation by such Lender or (as the case may be) the
Administrative Agent of a certificate in accordance with Section 6.9 hereof.
Each Lender shall allocate such cost increases among its customers in good faith
and on an equitable basis.
(b) Each Lender agrees that, upon the occurrence of any event giving
rise to the operation of Section 6.2.2, 6.6 or 6.7 with respect to such Lender,
it will, if requested in writing by the Borrower, use commercially reasonable
efforts (subject to overall policy considerations of such Lender) to designate
another lending office for any Loans affected by such event with the object of
avoiding the consequences of such event; provided, that such designation is made
on terms that, in the sole judgment of such Lender, cause such Lender and its
lending office(s) to suffer no economic, legal or regulatory disadvantage;
provided, further, that nothing in this Section 6.7 shall affect or postpone any
of the obligations of the Borrower or the rights of any Lender or the Agent
pursuant to Sections 6.2.2, 6.6 or 6.7.
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(c) Upon receipt by the Borrower from any Lender (an "Affected Lender")
of a claim under Sections 6.2.2, 6.6. or 6.7, the Borrower may:
(i) request one or more of the other Lenders to acquire and
assume all or part of such Affected Lender's Loans and Revolving Credit
Commitment, as applicable provided that no Lender shall be required to
accede to any such request; or
(ii) replace such Affected Lender with another Lender or an
Eligible Assignee; provided that (A) such other Lender or other lending
institute agrees to be the replacement Lender, (B) such replacement does
not conflict with any requirement of law, (C) no Default or Event of
Default shall have occurred and be continuing at the time of such
replacement, (D) the Borrower shall repay (or the replacement Lender
shall purchase, at par) all Loans, accrued interest and other amounts
owing to such replaced Lender prior to the date of replacement, (E) the
Borrower shall be liable to such replaced Lender in accordance with
Section 6.9 with respect to any prepayment or purchase of Eurodollar
Rate Loans, (F) the replacement Lender, if not already a Lender, shall
be an Eligible Assignee, (G) the replaced Lender shall be obligated to
make such replacement in accordance with the provisions of Section 16
(provided that the Borrower or the replacement Lender shall be obligated
to pay the registration and processing fee) and (H) the Borrower shall
pay all additional amounts (if any) required pursuant to Sections 6.2.2,
6.6 or 6.7, as the case may be, to the extent such additional amounts
were incurred on or prior to the consummation of such replacement.
6.8. CERTIFICATE. A certificate setting forth any additional amounts
payable pursuant to Sections 6.7 or 6.8 and a brief explanation of such amounts
which are due (including the calculation thereof in reasonable detail),
submitted by any Lender or the Administrative Agent to the Borrower, shall be
conclusive, absent manifest error, that such amounts are due and owing.
6.9. INDEMNITY. The Borrower agrees to indemnify each Lender and to hold
each Lender harmless from and against any loss, cost or expense (including loss
of anticipated profits) that such Lender may sustain or incur as a consequence
of (a) default by the Borrower in payment of the principal amount of or any
interest on any Eurodollar Rate Loans as and when due and payable, including any
such loss or expense arising from interest or fees payable by such Lender to
banks of funds obtained by it in order to maintain its Eurodollar Rate Loans,
(b) default by the Borrower in making a borrowing or conversion after the
Borrower has given (or are deemed to have given) a Loan Request, notice (in the
case of all or any portion of the Term Loans pursuant to Section 4.5.2) or a
Conversion Request relating thereto in accordance with Section 2.6 or Section
2.7 or Section 4.5 or (c) the making of any payment of a Eurodollar Rate Loan or
the making of any conversion of any such Loan to a Base Rate Loan on a day that
is not the last day of the applicable Interest Period with respect thereto,
including interest or fees payable by such Lender to lenders of funds obtained
by it in order to maintain any such Loans.
6.10. INTEREST AFTER DEFAULT.
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6.10.1. OVERDUE AMOUNTS. Overdue principal and (to the extent
permitted by applicable law) interest on the Loans and all other overdue
amounts payable hereunder or under any of the other Loan Documents shall
bear interest compounded monthly and payable on demand at a rate per
annum equal to the Base Rate plus the Applicable Margin for Base Rate
Loans then in effect, plus two percent (2.0%) per annum until such
amount shall be paid in full (after as well as before judgment).
6.10.2. AMOUNTS NOT OVERDUE. During the continuance of an Event
of Default the principal of the Loans not overdue shall, until such
Event of Default has been cured or remedied or such Event of Default has
been waived by the Required Lenders pursuant to Section 17.12, bear
interest at a rate per annum equal to the Base Rate plus the Applicable
Margin for Base Rate Loans then in effect, plus two percent (2.0%) per
annum.
7. COLLATERAL SECURITY.
The Obligations shall be secured by a perfected first priority security
interest (subject only to Permitted Liens entitled to priority under applicable
law) in all of the assets of the Borrower (including, without limitation,
accounts and notes receivable, inventory, equipment, intangible property,
licenses and intellectual property), whether now owned or hereafter acquired,
pursuant to the terms of the Security Documents to which the Borrower is a
party. In addition, the Obligations shall be secured by the pledge by BRS of all
of the Voting Stock of the Borrower owned by BRS pursuant to the terms of the
Stock Pledge Agreement.
8. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to the Lenders and the
Administrative Agent as follows:
8.1. CORPORATE AUTHORITY.
8.1.1. INCORPORATION; GOOD STANDING. The Borrower and each of
its Subsidiaries (a) is a corporation (or similar business entity) duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation or formation, (b) has all requisite
corporate (or the equivalent company) power to own its property and
conduct its business as now conducted and as presently contemplated, and
(c) is in good standing as a foreign corporation (or similar business
entity) and is duly authorized to do business in each jurisdiction where
such qualification is necessary except where a failure to be so
qualified would not have a Material Adverse Effect.
8.1.2. AUTHORIZATION. Except where a failure thereof would not
have a Material Adverse Effect, the execution, delivery and performance
of this Credit Agreement, the other Loan Documents, the Equity
Documents, the Merger Documents and the Subordinated Loan Documents to
which the Borrower or any of its Subsidiaries is or is to become a party
and the transactions contemplated hereby and thereby (a) are within the
corporate (or the equivalent company) authority of such Person, (b) have
been duly authorized by all necessary corporate (or the equivalent
company) proceedings, (c) do
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not and will not conflict with or result in any breach or contravention
of any provision of law, statute, rule or regulation to which the
Borrower or any of its Subsidiaries is subject or any judgment, order,
writ, injunction, license or permit applicable to the Borrower or any of
its Subsidiaries and (d) do not conflict with any provision of the
Governing Documents of, or any agreement or other instrument binding
upon, the Borrower or any of its Subsidiaries.
8.1.3. ENFORCEABILITY. The execution and delivery of this Credit
Agreement and the other Loan Documents to which the Borrower or any of
its Subsidiaries is or is to become a party will result in valid and
legally binding obligations of such Person enforceable against it in
accordance with the respective terms and provisions hereof and thereof,
except as enforceability is limited by bankruptcy, insolvency,
reorganization, moratorium or other laws relating to or affecting
generally the enforcement of creditors' rights and except to the extent
that availability of the remedy of specific performance or injunctive
relief is subject to the discretion of the court before which any
proceeding therefor may be brought.
8.2. GOVERNMENTAL APPROVALS. Except where a failure thereof would not
have a Material Adverse Effect, the execution, delivery and performance by the
Borrower and its Subsidiaries of this Credit Agreement, the other Loan
Documents, the Equity Documents, the Merger Documents and the Subordinated Loan
Documents to which each is or is to become a party and the transactions
contemplated hereby and thereby do not require the approval or consent of, or
filing with, any governmental agency or authority other than those already
obtained.
8.3. TITLE TO PROPERTIES; LEASES. Except as indicated on Schedule 8.3
hereto, ILFO and its Subsidiaries own all of the assets reflected in the
consolidated balance sheet of ILFO and its Subsidiaries as at the Interim
Balance Sheet Date or acquired since that date (except property and assets sold
or otherwise disposed of in the ordinary course of business since that date),
subject to no Liens or other rights of others, except Permitted Liens.
8.4. FINANCIAL STATEMENTS AND PROJECTIONS.
8.4.1. FISCAL YEAR. The Borrower and each of its Subsidiaries
has a fiscal year which is the twelve months ending on the Sunday
closest to December 31 of each calendar year.
8.4.2. FINANCIAL STATEMENTS. There has been furnished to each of
the Lenders a consolidated balance sheet of ILFO and its Subsidiaries as
at the Balance Sheet Date and as at the Interim Balance Sheet Date, and
a consolidated statement of income of ILFO and its Subsidiaries for the
fiscal period then ended, and in the case of the consolidated balance
sheet and consolidated statement of income of ILFO and its Subsidiaries
as of the Balance Sheet Date, certified by Deloitte & Touche LLP. Such
balance sheet and statement of income have been prepared in accordance
with GAAP and fairly present the financial condition of ILFO and its
Subsidiaries as at the close of business on the date thereof and the
results of operations for the fiscal period then ended, provided, that
the statements prepared (a) as at the Balance Sheet Date were on an
audited basis, and (b) as
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at the Interim Balance Sheet Date were on an unaudited basis, without
footnotes and are subject to normal year end adjustments. There are no
contingent liabilities of ILFO or any of its Subsidiaries as of such
date involving material amounts, known to the officers of the Borrower,
which were not disclosed in such balance sheet and the notes related
thereto.
8.4.3. PRO FORMA BALANCE SHEET DATE PROJECTIONS. The Borrower
has delivered to the Administrative Agent a consolidated pro forma
balance sheet as of the Closing Date reflecting the borrowing hereunder
on such date and the Merger (the "Pro Forma Balance Sheet"), which Pro
Forma Balance Sheet has been prepared in good faith on the basis of the
assumptions stated therein. The projections of the annual operating
budgets of the Borrower and its Subsidiaries on a consolidated basis,
balance sheets and cash flow statements for the 2001 to 2006 fiscal
years, copies of which have been delivered to each Lender, disclose all
assumptions made with respect to general economic, financial and market
conditions used in formulating such projections on the Pro Forma Balance
Sheet. To the knowledge of the Borrower or any of its Subsidiaries, no
facts exist that (individually or in the aggregate) would result in any
material change in any of such projections on the Pro Forma Balance
Sheet. The projections are based upon reasonable estimates and
assumptions, have been prepared on the basis of the assumptions stated
therein and reflect the reasonable estimates of the Borrower and its
Subsidiaries of the results of operations and other information
projected therein.
8.5. NO MATERIAL ADVERSE CHANGES, ETC.
(a) Except as disclosed in the financial statements provided to the
Lenders prior to the Closing Date, from the Interim Balance Sheet Date through
the Closing Date, there has occurred no materially adverse change in the
financial condition or business of ILFO and its Subsidiaries as shown on or
reflected in the consolidated balance sheet of ILFO and its Subsidiaries as at
the Interim Balance Sheet Date, or the consolidated statement of income for the
fiscal period then ended, other than changes in the ordinary course of business
that have not had any materially adverse effect either individually or in the
aggregate on the business or financial condition of ILFO and its Subsidiaries.
From the Interim Balance Sheet Date through the Closing Date, ILFO has not made
any Restricted Payment.
(b) Except as disclosed in the financial statements provided to the
Lenders prior to the Closing Date, since the Closing Date, there has occurred no
materially adverse change in the financial condition or business of the Borrower
as shown on or reflected in the Pro Forma Balance Sheet, other than changes in
the ordinary course of business that have not had any materially adverse effect
either individually or in the aggregate on the business or financial condition
of the Borrower.
8.6. LAWS, LICENSES; FRANCHISES, PATENTS, COPYRIGHTS, ETC.
8.6.1. LAWS, LICENSES. Neither the Borrower nor any of its
Subsidiaries is in violation of or delinquent with respect to, any
decree, order, or arbitration award of any court or governmental
authority, or any agreement with, or any license or permit from, any
governmental authority, or any statute, law, license, rule or regulation
including,
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without limitation, laws and regulations relating to food or liquor,
occupational health and safety, equal employment opportunities, fair
employment practices, and sex, race, religious or age discrimination, in
any of the foregoing cases in a manner that could reasonably be expected
to result in the imposition of substantial penalties or that have a
Material Adverse Effect. Any and all approvals by any federal, state or
local liquor authority necessary for the continued operation of any
restaurant or bakery operated by the Borrower or its Subsidiaries with
full liquor service have been received and remain in full force and
effect except where the failure thereof would not have a Materially
Adverse Effect.
8.6.2. FRANCHISES, PATENTS, COPYRIGHTS, ETC. Except as set forth
on Schedule 8.6.2 and where a failure thereof would not have a Material
Adverse Effect, the Borrower and its Subsidiaries possesses all
franchises, patents, copyrights, trademarks, trade names, licenses and
permits, and rights in respect of the foregoing, adequate for the
conduct of the business of the Borrower and its Subsidiaries,
substantially as such business is now conducted without known conflict
with any rights of others.
8.7. LITIGATION. Except as set forth in Schedule 8.7 hereto, there are
no actions, suits, proceedings or investigations of any kind pending or, to the
knowledge of Borrower or its Subsidiaries, threatened against the Borrower or
any of its Subsidiaries before any Governmental Authority, that, (a) if
adversely determined, could reasonably be expected to, either in any case or in
the aggregate, (i) have a Material Adverse Effect or (ii) materially impair the
right of the Borrower and its Subsidiaries, considered as a whole, to carry on
business substantially as now conducted by them, or result in any substantial
liability not adequately covered by insurance, or for which adequate reserves
are not maintained on the consolidated balance sheet of the Borrower and its
Subsidiaries, or (b) question the validity of this Credit Agreement or any of
the other Loan Documents, or any action taken or to be taken pursuant hereto or
thereto.
8.8. NO MATERIALLY ADVERSE CONTRACTS, ETC. Neither the Borrower nor any
of its Subsidiaries is subject to any Governing Document or other legal
restriction, or any judgment, decree, order, law, statute, rule or regulation
that has or is expected in the future to have a Material Adverse Effect. Neither
the Borrower nor any of its Subsidiaries is a party to any contract or agreement
that has or is expected, in the reasonable judgment of the Borrower's officers,
to have any Material Adverse Effect. Neither the Borrower nor any of its
Subsidiaries is a party to any supply contract, the termination or non-renewal
of which could reasonably be expected to have a Material Adverse Effect.
8.9. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. Neither the Borrower
nor any of its Subsidiaries is in violation of any provision of its Governing
Documents, or any agreement or instrument to which it may be subject or by which
it or any of its properties may be bound or any decree, order, judgment,
statute, license, rule or regulation, in any of the foregoing cases in a manner
that could result in the imposition of substantial penalties or have a Material
Adverse Effect.
8.10. TAX STATUS. The Borrower and its Subsidiaries (a) have made or
filed all federal, state and foreign income and all other tax returns, reports
and declarations required by any
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jurisdiction to which any of them is subject, (b) have paid all taxes and other
governmental assessments and charges shown or determined to be due on such
returns, reports and declarations, except those being contested in good faith
and by appropriate proceedings and (c) have set aside on their books provisions
reasonably adequate for the payment of all taxes for periods subsequent to the
periods to which such returns, reports or declarations apply. There are no
unpaid taxes in any material amount claimed to be due by the taxing authority of
any jurisdiction, and none of the officers of the Borrower know of any basis for
any such claim.
8.11. NO EVENT OF DEFAULT. No Default or Event of Default has occurred
and is continuing.
8.12. HOLDING COMPANY AND INVESTMENT COMPANY ACTS. Neither the Borrower
nor any of its Subsidiaries is a "holding company", or a "subsidiary company" of
a "holding company", or an "affiliate" of a "holding company", as such terms are
defined in the Public Utility Holding Company Act of 1935; nor is it an
"investment company", or an "affiliated company" or a "principal underwriter" of
an "investment company", as such terms are defined in the Investment Company Act
of 1940.
8.13. ABSENCE OF FINANCING STATEMENTS, ETC. Except with respect to
Permitted Liens, there is no financing statement, security agreement, chattel
mortgage, real estate mortgage or other document filed or recorded with any
filing records, registry or other public office, that purports to cover, affect
or give notice of any present or possible future Lien on any assets or property
of the Borrower or any of its Subsidiaries or any rights relating thereto.
8.14. PERFECTION OF SECURITY INTERESTS. Except for Mortgages and Agency
Account Agreements to be delivered after the Closing Date, all filings,
assignments, pledges and deposits of documents or instruments have been made and
all other actions have been taken that are necessary or advisable, under
applicable law, to establish and perfect the Administrative Agent's security
interest in the Collateral. The Collateral and the Administrative Agent's rights
with respect to the Collateral are not subject to any setoff, claims,
withholdings or other defenses. The Borrower and its Subsidiaries are the owner
of the Collateral free from any Lien, except for Permitted Liens.
8.15. CERTAIN TRANSACTIONS. Except for transactions set forth on
Schedule 8.15 hereto and arm's length transactions pursuant to which the
Borrower or any of its Subsidiaries makes payments in the ordinary course of
business upon terms no less favorable than the Borrower or such Subsidiary could
obtain from third parties, none of the affiliates, officers, directors, or
employees of the Borrower or any of its Subsidiaries is presently a party to any
transaction with the Borrower or any of its Subsidiaries (other than for
services as employees, officers and directors), including any contract,
agreement or other arrangement providing for the furnishing of services to or
by, providing for rental of real or personal property to or from, or otherwise
requiring payments to or from any officer, director or such employee or, to the
knowledge of the Borrower, any corporation, partnership, trust or other entity
in which any officer, director, or any such employee has a substantial interest
or is an officer, director, trustee or partner.
8.16. EMPLOYEE BENEFIT PLANS.
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8.16.1. IN GENERAL. Each Employee Benefit Plan and each
Guaranteed Pension Plan has been maintained and operated in compliance
in all material respects with the provisions of ERISA and all Applicable
Pension Legislation and, to the extent applicable, the Code, including
but not limited to the provisions thereunder respecting prohibited
transactions and the bonding of fiduciaries and other persons handling
plan funds as required by Section 412 of ERISA. The Borrower has
heretofore delivered to the Administrative Agent the most recently
completed annual report, Form 5500, with all required attachments, and
actuarial statement required to be submitted under Section 103(d) of
ERISA, with respect to each Guaranteed Pension Plan.
8.16.2. TERMINABILITY OF WELFARE PLANS. No Employee Benefit Plan
which is an employee welfare benefit plan within the meaning of Section
3(1) or Section 3(2)(B) of ERISA, provides benefit coverage subsequent
to termination of employment, except as required by Title I, Part 6 of
ERISA or the applicable state insurance laws. The Borrower may terminate
each such Plan at any time (or at any time subsequent to the expiration
of any applicable bargaining agreement) in the discretion of the
Borrower without liability to any Person other than for claims arising
prior to termination.
8.16.3. GUARANTEED PENSION PLANS. Each contribution required to
be made to a Guaranteed Pension Plan, whether required to be made to
avoid the incurrence of an accumulated funding deficiency, the notice or
lien provisions of Section 302(f) of ERISA, or otherwise, has been
timely made. No waiver of an accumulated funding deficiency or extension
of amortization periods has been received with respect to any Guaranteed
Pension Plan, and neither the Borrower nor any ERISA Affiliate is
obligated to or has posted security in connection with an amendment to a
Guaranteed Pension Plan pursuant to Section 307 of ERISA or Section
401(a)(29) of the Code. No liability to the PBGC (other than required
insurance premiums, all of which have been paid when due) has been
incurred by the Borrower or any ERISA Affiliate with respect to any
Guaranteed Pension Plan and there has not been any ERISA Reportable
Event (other than an ERISA Reportable Event as to which the requirement
of thirty (30) days notice has been waived), or any other event or
condition which presents a material risk of termination of any
Guaranteed Pension Plan by the PBGC. Based on the latest valuation of
each Guaranteed Pension Plan (which in each case occurred within twelve
months of the date of this representation), and on the actuarial methods
and assumptions employed for that valuation, the aggregate benefit
liabilities of all such Guaranteed Pension Plans within the meaning of
Section 4001 of ERISA did not exceed the aggregate value of the assets
of all such Guaranteed Pension Plans, disregarding for this purpose the
benefit liabilities and assets of any Guaranteed Pension Plan with
assets in excess of benefit liabilities.
8.16.4. MULTIEMPLOYER PLANS. Neither the Borrower nor any ERISA
Affiliate has incurred any material liability (including secondary
liability) to any Multiemployer Plan as a result of a complete or
partial withdrawal from such Multiemployer Plan under Section 4201 of
ERISA or as a result of a sale of assets described in Section 4204 of
ERISA. Neither the Borrower nor any ERISA Affiliate has been notified
that any Multiemployer Plan is in reorganization or insolvent under and
within the meaning of Section 4241 or Section 4245 of ERISA or
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is at risk of entering reorganization or becoming insolvent, or that any
Multiemployer Plan intends to terminate or has been terminated under
Section 4041A of ERISA.
8.17. USE OF PROCEEDS.
8.17.1. GENERAL. The proceeds of the Term Loan and up to
$3,500,000 of the Revolving Credit Loans shall be used to finance the
Merger and to pay fees and expenses associated with the Merger. The
remainder of the Revolving Credit Loans shall be used for the
acquisition and/or construction of new Stores and to upgrade existing
Stores, in each case in accordance with the terms hereof, and for
working capital and general corporate purposes. The Borrower will obtain
Letters of Credit solely for working capital and general corporate
purposes.
8.17.2. REGULATIONS U AND X. No portion of any Loan is to be
used, and no portion of any Letter of Credit is to be obtained, for the
purpose of purchasing or carrying any "margin security" or "margin
stock" as such terms are used in Regulations U and X of the Board of
Governors of the Federal Reserve System, 12 C.F.R. Parts 221 and 224.
8.17.3. INELIGIBLE SECURITIES. No portion of the proceeds of any
Loans is to be used, and no portion of any Letter of Credit is to be
obtained, for the purpose of knowingly purchasing, or providing credit
support for the purchase of, during the underwriting or placement period
or within thirty (30) days thereafter, any Ineligible Securities
underwritten or privately placed by a Financial Affiliate.
8.18. ENVIRONMENTAL COMPLIANCE. The Borrower has taken all steps
reasonably deemed necessary by the Borrower to investigate the past and present
condition and usage of the Real Estate and the operations conducted thereon and,
based upon such diligent investigation, has determined that:
(a) none of the Borrower or its Subsidiaries is in violation,
or, to the knowledge of Borrower or its Subsidiaries, alleged violation,
of any judgment, decree, order, law, license, rule or regulation
pertaining to environmental matters, including without limitation, those
arising under the Resource Conservation and Recovery Act ("RCRA"), the
Comprehensive Environmental Response, Compensation and Liability Act of
1980 as amended ("CERCLA"), the Superfund Amendments and Reauthorization
Act of 1986 ("XXXX"), the Federal Clean Water Act, the Federal Clean Air
Act, the Toxic Substances Control Act, or any state, local or foreign
law, statute, regulation, ordinance, order or decree relating to health,
safety or the environment (hereinafter "Environmental Laws"), which
violation could reasonably be expected to have a Material Adverse
Effect;
(b) Neither the Borrower nor any of its Subsidiaries has
received notice from any third party including, without limitation, any
Governmental Authority, (i) that any one of them has been identified by
the United States Environmental Protection Agency ("EPA") as a
potentially responsible party under CERCLA with respect to a site listed
on the National Priorities List, 40 C.F.R. Part 000 Xxxxxxxx X; (ii)
that any hazardous waste, as defined by 42 U.S.C. Section 6903(5), any
hazardous substances as defined by 42 U.S.C.
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Section 9601(14), any pollutant or contaminant as defined by 42 U.S.C.
Section 9601(33) and any toxic substances, petroleum products or
hazardous materials or other chemicals or substances regulated by any
Environmental Laws ("Hazardous Substances") which any one of them has
generated, transported or disposed of has been found at any site at
which a Governmental Authority has conducted or has ordered that the
Borrower or any of its Subsidiaries conduct a remedial investigation,
removal or other response action pursuant to any Environmental Law; or
(iii) that it is or shall be a named party to any claim, action, cause
of action, complaint, or legal or administrative proceeding (in each
case, contingent or otherwise) arising out of any third party's
incurrence of costs, expenses, losses or damages of any kind whatsoever
in connection with the release of Hazardous Substances;
(c) except as set forth on Schedule 8.18 attached hereto: (i) no
portion of the Real Estate has been used by the Borrower or any of its
Subsidiaries, or to the Borrower's knowledge, by others, for the
handling, processing, storage or disposal of Hazardous Substances except
in accordance with applicable Environmental Laws; and no underground
tank or other underground storage receptacle for Hazardous Substances is
located on any portion of the Real Estate; (ii) in the course of any
activities conducted by the Borrower, its Subsidiaries or operators of
its properties, no Hazardous Substances have been generated by the
Borrower or any of its Subsidiaries, or to the Borrower's knowledge, by
others, or are being used on the Real Estate except in substantial
compliance with applicable Environmental Laws; (iii) there have been no
releases (i.e. any past or present releasing, spilling, leaking,
pumping, pouring, emitting, emptying, discharging, injecting, escaping,
disposing or dumping) or threatened releases of Hazardous Substances by
the Borrower or any of its Subsidiaries, or to the Borrower's knowledge,
by others, on, upon, into or from the properties of the Borrower or its
Subsidiaries, which releases would have a Material Adverse Effect; (iv)
to the best of the Borrower's knowledge, there have been no releases on,
upon, from or into any real property in the vicinity of any of the Real
Estate which, through soil or groundwater contamination, may have come
to be located on, and which would have a Material Adverse Effect; and
(v) in addition, any Hazardous Substances that have been generated on
any of the Real Estate while owned or leased by the Borrower or any of
its Subsidiaries have been transported offsite in substantial compliance
with applicable Environmental Laws, treated or disposed of only by
treatment or disposal facilities maintaining valid permits as required
under applicable Environmental Laws, which transporters and facilities
have been and are, to the best of the Borrower's knowledge, operating in
compliance with such permits and applicable Environmental Laws; and
(d) none of the Borrower and its Subsidiaries, any Mortgaged
Property or any of the other Real Estate is subject to any applicable
Environmental Law requiring the performance of Hazardous Substances site
assessments, or the removal or remediation of Hazardous Substances, or
the giving of notice to any Governmental Authority or the recording or
delivery to other Persons of an environmental disclosure document or
statement by virtue of the transactions set forth herein and
contemplated hereby, or as a condition to the recording of any Mortgage
or to the effectiveness of any
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other transactions contemplated hereby, except where the existence
thereof would not have a Material Adverse Effect.
8.19. SUBSIDIARIES, etc. Schedule 8.19, as such Schedule 8.19 may be
updated from time to time in accordance with the provisions of Section 9.16,
lists all Subsidiaries of the Borrower, together with information on their
jurisdictions of incorporation, the number and class of authorized and issued
capital stock and the owners of all issued capital stock. Such capital stock
constitutes, of record, 100% of the outstanding capital stock of each such
Subsidiary and, on a fully-diluted basis, 100% of such outstanding capital
stock. Except as set forth on Schedule 8.19 hereto, neither the Borrower nor any
of its Subsidiaries is engaged in any joint venture or partnership with any
other Person.
8.20. DISCLOSURE. None of this Credit Agreement or any of the other Loan
Documents contains any untrue statement of a material fact or omits to state a
material fact (known to the Borrower or any of its Subsidiaries in the case of
any document or information not furnished by it or any of its Subsidiaries)
necessary in order to make the statements herein or therein not misleading as of
the date made. There is no fact known to the Borrower or any of its Subsidiaries
which has a Material Adverse Effect, or which is reasonably likely in the future
to have a Material Adverse Effect, exclusive of effects resulting from changes
in general economic conditions, legal standards or regulatory conditions.
8.21. MERGER DOCUMENTS; SUBORDINATED LOAN DOCUMENTS; EQUITY DOCUMENTS.
(a) The Borrower has heretofore furnished to the Administrative
Agent true, complete and correct copies of the Merger Documents
(including schedules, exhibits and annexes thereto). The Merger
Documents have not subsequently been amended, supplemented, or modified
(other than the amendments, if any, delivered to the Lenders on or prior
to the Closing Date and consented to or approved on or prior to the
Closing Date by the Lenders or as expressly permitted hereunder) and
constitute the complete understanding among the parties thereto in
respect of the matters and transactions covered thereby. To the best
knowledge of the Borrower, as of the Closing Date, all of the
representations and warranties contained in the Merger Documents were
true and correct in all material respects when made or deemed to be made
except as would not have a Materially Adverse Effect after giving effect
to the transactions contemplated thereby, and the Administrative Agent
and the Lenders may rely on such representations and warranties as if
they were incorporated herein on the Closing Date; provided, that
nothing contained herein shall prejudice in any way any rights of the
Borrower under or in respect of the Merger Documents, all of which are
expressly hereby reserved. The requirements of Section 12.21 have been
satisfied as of the Closing Date (subject to the satisfaction of the
Administrative Agent as to the matters set forth therein which expressly
require such satisfaction).
(b) The Borrower has heretofore furnished to the Administrative
Agent true, complete and correct copies of the Subordinated Loan
Documents (including schedules, exhibits and annexes thereto). The
Subordinated Loan Documents have not subsequently been amended,
supplemented, or modified (other than the amendments, if any, delivered
to the Lenders on or prior to the Closing Date and consented to or
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approved on or prior to the Closing Date by the Lenders or as expressly
permitted hereunder) and constitute the complete understanding among the
parties thereto in respect of the matters and transactions covered
thereby. As of the Closing Date, the representations and warranties of
the Borrower and its Affiliates contained in the Subordinated Loan
Documents were true and correct in all material respects when made or
deemed to be made except as would not have a Materially Adverse Effect
and the Administrative Agent and the Lenders may rely on such
representations and warranties as if they were incorporated herein on
the Closing Date; provided, that nothing contained herein shall
prejudice in any way any rights of the Borrower under or in respect of
the Subordinated Loan Documents, all of which are expressly hereby
reserved. The requirements of Section 12.15 have been satisfied as of
the Closing Date (subject to the satisfaction of the Administrative
Agent as to the matters set forth therein which expressly require such
satisfaction).
(c) The Borrower has heretofore furnished to the Administrative
Agent true, complete and correct copies of the Equity Documents
(including schedules, exhibits and annexes thereto). The Equity
Documents have not subsequently been amended, supplemented, or modified
(other than the amendments, if any, delivered to the Lenders on or prior
to the Closing Date and consented to or approved on or prior to the
Closing Date by the Lenders or as expressly permitted hereunder) and
constitute the complete understanding among the parties thereto in
respect of the matters and transactions covered thereby. As of the
Closing Date, the representations and warranties of the Borrower and its
Affiliates contained in the Equity Documents were true and correct in
all material respects when made or deemed to be made except as would not
have a Materially Adverse Effect and the Administrative Agent and the
Lenders may rely on such representations and warranties as if they were
incorporated herein on the Closing Date; provided, that nothing
contained herein shall prejudice in any way any rights of the Borrower
under or in respect of the Equity Documents, all of which are expressly
hereby reserved. The requirements of Section 12.15 have been satisfied
as of the Closing Date (subject to the satisfaction of the
Administrative Agent as to the matters set forth therein which expressly
require such satisfaction).
8.22. SOLVENCY. Both before and after giving effect to this Credit
Agreement and the other Loan Documents and the Merger, the Borrower and its
Subsidiaries on a consolidated basis are Solvent. As used herein, "Solvent"
shall mean that the Borrower and its Subsidiaries (i) have assets having a fair
value in excess of their liabilities, (ii) have assets having a fair value in
excess of the amount required to pay their liabilities on existing debts as such
debts become absolute and matured, and (iii) have, and expect to continue to
have, access to adequate capital for the conduct of their business and the
ability to pay their debts from time to time incurred in connection with the
operation of their business as such debts mature.
8.23. BANK ACCOUNTS. Schedule 8.23, as such Schedule 8.23 may be updated
from time to time in accordance with the provisions of Section 9.5.5, sets forth
the account numbers and location of all bank accounts of the Borrower and its
Subsidiaries.
8.24. STORES. Schedule 8.24 sets forth, as of the Closing Date, the
names and addresses of each Store.
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8.25. LEASES. Neither the execution, delivery and performance of this
Credit Agreement, the other Loan Documents, the Equity Documents, the Merger
Documents and the Subordinated Loan Documents to which the Borrower or any of
its Subsidiaries is a party, including a pledge by the Borrower to the
Administrative Agent of all the Equity Interests of the Borrower nor the
realization by the Administrative Agent on such pledge, will create a default
under any Real Estate Lease under which the Borrower or any of its Subsidiaries
is presently a lessee or sublessee, which is likely to have a Material Adverse
Effect.
9. AFFIRMATIVE COVENANTS.
The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit or Note is outstanding or any Lender
has any obligation to make any Loans or the Administrative Agent has any
obligation to issue, extend or renew any Letters of Credit:
9.1. PUNCTUAL PAYMENT. The Borrower will duly and punctually pay or
cause to be paid the principal and interest on the Loans, all Reimbursement
Obligations, the Letter of Credit Fees, the commitment fees, the Administrative
Agent's fee and all other amounts provided for in this Credit Agreement and the
other Loan Documents to which the Borrower or any of its Subsidiaries is a
party, all in accordance with the terms of this Credit Agreement and such other
Loan Documents.
9.2. MAINTENANCE OF OFFICE. The Borrower will maintain its chief
executive office at the location identified in the Perfection Certificate
delivered by it, or at such other place in the United States of America as the
Borrower shall designate upon written notice to the Administrative Agent, where
notices, presentations and demands to or upon the Borrower in respect of the
Loan Documents to which the Borrower is a party may be given or made.
9.3. RECORDS AND ACCOUNTS. The Borrower will (a) keep, and cause each of
its Subsidiaries to keep, true and accurate records and books of account in
which full, true and correct entries will be made in accordance with GAAP, (b)
maintain adequate accounts and reserves for all taxes (including income taxes),
depreciation, depletion, obsolescence and amortization of its properties and the
properties of its Subsidiaries, contingencies, and other reserves, and (c) at
all times engage Deloitte & Touche LLP, another nationally recognized
independent certified public accounting firm that is currently known as a "Big
Five" accounting firm or, so long as reasonably satisfactory to the Required
Lenders, other independent certified public accountants as the independent
certified public accountants (the "Accountants") of the Borrower and its
Subsidiaries and will not permit more than thirty (30) days to elapse between
the cessation of such firm's (or any successor firm's) engagement as the
independent certified public accountants of the Borrower and its Subsidiaries
and the appointment in such capacity of a successor firm as shall be reasonably
satisfactory to the Administrative Agent.
9.4. FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION. The Borrower
will deliver to each of the Lenders:
(a) as soon as practicable, but in any event not later than
ninety (90) days after the end of each fiscal year of the Borrower, the
consolidated balance sheet of the
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Borrower and its Subsidiaries as at the end of such year, and the
related consolidated statement of income and consolidated statement of
cash flow for such year, each setting forth in comparative form the
figures for the previous fiscal year and the projections for such fiscal
year and all such consolidated statements to be in reasonable detail,
prepared in accordance with GAAP, and certified, without qualification
and without an expression of uncertainty as to the ability of the
Borrower or any of its Subsidiaries to continue as going concerns, by
the Accountants, together with a written statement from such Accountants
to the effect that they have read a copy of this Credit Agreement, and
that, in making the examination necessary to said certification, they
have obtained no knowledge of any Default or Event of Default, or, if
such Accountants shall have obtained knowledge of any then existing
Default or Event of Default they shall disclose in such statement any
such Default or Event of Default; provided that such Accountants shall
not be liable to the Lenders for failure to obtain knowledge of any
Default or Event of Default, such financial statements to be accompanied
by the certificate required by Section 4.3.2;
(b) as soon as practicable, but in any event not later than
forty-five (45) days after the end of each of the fiscal quarters of the
Borrower, copies of the unaudited consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of such quarter, and the
related consolidated statement of income and consolidated statement of
cash flow for the portion of the Borrower's fiscal year then elapsed,
each setting forth in comparative form the figures for the corresponding
fiscal quarter from the prior fiscal year and the projections for such
fiscal quarter all in reasonable detail and prepared in accordance with
GAAP, together with a certification by the principal financial or
accounting officer of the Borrower that the information contained in
such financial statements fairly presents the financial position of the
Borrower and its Subsidiaries on the date thereof (subject to year-end
adjustments);
(c) as soon as practicable, but in any event within thirty (30)
days after the end of each month in each fiscal year of the Borrower,
unaudited monthly consolidated financial statements of the Borrower and
its Subsidiaries for such month prepared in accordance with GAAP, each
setting forth in comparative form the figures for the corresponding
fiscal month from the prior fiscal year and the projections for such
fiscal month together with a certification by the principal financial or
accounting officer of the Borrower that the information contained in
such financial statements fairly presents the financial condition of the
Borrower and its Subsidiaries on the date thereof (subject to year-end
adjustments);
(d) as soon as practicable, but in any event not later than
forty-five (45) days after the end of each of the fiscal quarters of the
Borrower and its Subsidiaries sales and Consolidated EBITDA statements
on an individual Store-by-Store basis for each Store operated by the
Borrower or any of its Subsidiaries, each setting forth in comparative
form the figures for the corresponding fiscal quarter from the prior
fiscal year and the projections for such fiscal quarter, such statements
to be in a form satisfactory to the Required Lenders;
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(e) simultaneously with the delivery of the financial statements
referred to in subsections (a) and (b) above, a statement certified by
the principal financial or accounting officer of the Borrower in
substantially the form of Exhibit D hereto (a "Compliance Certificate")
and setting forth in reasonable detail computations evidencing
compliance with the covenants contained in Section 11 and (if
applicable) reconciliations to reflect changes in GAAP since the Balance
Sheet Date;
(f) contemporaneously with the filing or mailing thereof, copies
of all material of a financial nature filed with the Securities and
Exchange Commission or sent to the stockholders of the Borrower;
(g) within forty-five (45) days after the beginning of each
fiscal year of the Borrower and from time to time upon request of the
Administrative Agent (but not more frequently than annually so long as
no Default or Event of Default is continuing), projections of the
Borrower and its Subsidiaries broken down for the next fiscal year on a
month by month and quarter by quarter basis updating those projections
and budgets delivered to the Lenders and referred to in Section 8.4.3
or, if applicable, updating any later such projections delivered in
response to a request pursuant to this Section 9.4(g);
(h) all information sent to the directors of the Borrower
regarding the opening of new Stores;
(i) all notices and other information sent to any holder of
Subordinated Debt, in its capacity as such; and
(j) from time to time such other financial data and information
(including accountants' management letters) as the Administrative Agent
or any Lender may reasonably request.
9.5. NOTICES.
9.5.1. DEFAULTS. The Borrower will promptly notify the
Administrative Agent in writing of the occurrence of any Default or
Event of Default, together with a reasonably detailed description
thereof, and the actions the Borrower proposes to take with respect
thereto. If any Person shall give any notice or take any other action in
respect of a claimed default (whether or not constituting an Event of
Default) under this Credit Agreement or any other note, evidence of
indebtedness, indenture or other obligation to which or with respect to
which the Borrower or any of its Subsidiaries is a party or obligor in
excess of $1,000,000 whether as principal, guarantor, surety or
otherwise, the Borrower shall forthwith give written notice thereof to
the Administrative Agent, describing the notice or action and the nature
of the claimed default.
9.5.2. ENVIRONMENTAL EVENTS. The Borrower will promptly give
notice to the Administrative Agent (a) of any violation of any
Environmental Law that the Borrower or any of its Subsidiaries reports
in writing or is reportable by such Person in writing (or for which any
written report supplemental to any oral report is made) to any
Governmental Authority and (b) upon becoming aware thereof, of any
inquiry,
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proceeding, investigation, or other action, including a notice from any
agency of potential environmental liability, of any Governmental
Authority that could have a Material Adverse Effect.
9.5.3. NOTIFICATION OF CLAIM AGAINST COLLATERAL. The Borrower
will, immediately upon becoming aware thereof, notify the Administrative
Agent in writing of any setoff, claims (including, with respect to the
Real Estate, environmental claims), withholdings or other defenses to
which any of the Collateral, or the Administrative Agent's rights with
respect to the Collateral, are subject.
9.5.4. NOTICE OF LITIGATION AND JUDGMENTS. The Borrower will,
and will cause each of its Subsidiaries to, give notice to the
Administrative Agent in writing within fifteen (15) days of becoming
aware of any litigation or proceedings threatened in writing or any
pending litigation and proceedings affecting the Borrower or any of its
Subsidiaries or to which the Borrower or any of its Subsidiaries is or
becomes a party involving an uninsured claim against the Borrower or any
of its Subsidiaries that could reasonably be expected to have a Material
Adverse Effect on the Borrower or any of its Subsidiaries and stating
the nature and status of such litigation or proceedings. The Borrower
will, and will cause each of its Subsidiaries to, give notice to the
Administrative Agent and each of the Lenders, in writing, in form and
detail satisfactory to the Administrative Agent, within ten (10) days of
any judgment not covered by insurance, final or otherwise, against the
Borrower or any of its Subsidiaries in an amount in excess of $500,000.
9.5.5. NOTICE OF BANK ACCOUNTS. The Borrower will, and will
cause each of its Subsidiaries to, give notice to the Administrative
Agent in writing of any such Person creating or opening any additional
bank accounts simultaneously with the delivery of the financial
statements referred to in Section 9.4(c) but in any event no later than
one month after the opening of such account. In such event, the
Administrative Agent is hereby authorized by the parties hereto to amend
Schedule 8.24 to include each such new bank account.
9.6. LEGAL EXISTENCE; MAINTENANCE OF PROPERTIES. The Borrower will do or
cause to be done all things necessary to preserve and keep in full force and
effect its legal existence, rights and franchises and those of its Subsidiaries
and those rights and franchises necessary to its and its Subsidiaries businesses
and will not, and will not cause or permit any of its Subsidiaries to, convert
to a limited liability company. It (i) will cause all of its properties and
those of its Subsidiaries used or useful in the conduct of its business or the
business of its Subsidiaries to be maintained and kept in good condition, repair
and working order and supplied with all necessary equipment, (ii) will cause to
be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of the Borrower may be necessary so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times, and (iii) will, and will cause each of
its Subsidiaries to, continue to engage primarily in the businesses now
conducted by them and in related businesses; provided that nothing in this
Section 9.6 shall prevent the Borrower from discontinuing the operation and
maintenance of any of its properties or any of those of its Subsidiaries if such
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discontinuance is, in the judgment of the Borrower, desirable in the conduct of
its or their business and that do not in the aggregate have a Material Adverse
Effect.
9.7. INSURANCE.
9.7.1. REQUIRED INSURANCE. The Borrower will, and will cause
each of its Subsidiaries to, maintain with financially sound and
reputable insurers insurance with respect to its properties and business
against such casualties and contingencies as shall be in accordance with
the general practices of businesses engaged in similar activities in
similar geographic areas and in amounts, containing such terms, in such
forms and for such periods as may be reasonable and prudent. Without
limiting the foregoing, (a) such insurance shall be in such minimum
amounts that such Person will not be deemed a co-insurer under
applicable insurance laws, regulations and policies and otherwise shall
be in such amounts, contain such terms, be in such forms and be for such
periods as may be reasonably satisfactory to the Administrative Agent,
(b) all such insurance shall be payable to the Administrative Agent as
loss payee under a "standard" or "New York" loss payee clause for the
benefit of the Lenders and the Administrative Agent (c) each such Person
will (i) keep all of its physical property insured with casualty or
physical hazard insurance on an "all risks" basis, with broad form flood
coverage and electronic data processing coverage, with a full
replacement cost endorsement and an "agreed amount" clause in an amount
equal to 100% of the full replacement cost of such property, subject to
aggregate sublimits for flood equal to those generally maintained by
businesses engaged in similar activities in similar geographic areas,
(ii) maintain all such workers' compensation or similar insurance as may
be required by law and (iii) maintain, in amounts and with deductibles
equal to those generally maintained by businesses engaged in similar
activities in similar geographic areas, general public liability
insurance against claims of bodily injury, death or property damage
occurring, on, in or about the properties of such Person; business
interruption insurance; and product liability insurance. The Borrower
will, and will cause each of its Subsidiaries to, deliver to the
Administrative Agent a certificate of insurance evidencing the
Administrative Agent's interest, for the benefit of the Administrative
Agent and the Lenders, as loss payee within thirty (30) days after the
end of each fiscal year. The Borrower will, and will cause each of its
Subsidiaries to, maintain insurance on the Mortgaged Properties in
accordance with the terms of the Mortgages.
9.7.2. INSURANCE PROCEEDS. The proceeds of any casualty
insurance in respect of any casualty loss of any of the Collateral
shall, subject to the rights, if any, of other parties with a prior
interest in the property covered thereby, (i) so long as no Event of
Default has occurred and is continuing and to the extent that the amount
of such proceeds is less than $2,500,000, be disbursed to the Borrower
for reinvestment in the Borrower's business and (ii) in all other
circumstances, be held by the Administrative Agent as cash collateral
for the Obligations. The Administrative Agent may, so long as no Event
of Default has occurred and is continuing and the Borrower is not
required to apply such proceeds to prepay the Obligations pursuant to
Section 4.3.3(c), disburse from time to time all or any part of such
proceeds so held as cash collateral, upon such terms and conditions as
the Administrative Agent may reasonably prescribe, for direct
application
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by the Borrower solely to the repair or replacement of the Borrower's
property so damaged or destroyed. In the event that such proceeds have
not been reinvested or committed for reinvestment in the Borrower's
business within two hundred and seventy (270) days after the earlier to
occur of receipt thereof by the Borrower or receipt thereof by the
Administrative Agent, the Administrative Agent shall apply all or any
part of such proceeds to the Obligations as provided in Section 4.3.4.
9.7.3. NOTICE OF CANCELLATION. All policies of insurance shall
provide for at least thirty (30) days prior written cancellation notice
to the Administrative Agent. In the event of failure by the Borrower to
provide and maintain insurance as herein provided, the Administrative
Agent may, at its option, provide such insurance and charge the amount
thereof to the Borrower. The Borrower shall furnish the Administrative
Agent with certificates of insurance and policies evidencing compliance
with the foregoing insurance provision.
9.8. TAXES. The Borrower will, and will cause each of its Subsidiaries
to, duly pay and discharge, or cause to be paid and discharged, before the same
shall become overdue, all taxes, assessments and other governmental charges
imposed upon it and its Real Estate, sales and activities, or any part thereof,
or upon the income or profits therefrom, as well as all claims for labor,
materials, or supplies that if unpaid might by law become a Lien or charge upon
any of its property; provided that any such tax, assessment, charge, levy or
claim need not be paid if the validity or amount thereof shall currently be
contested in good faith by appropriate proceedings and if the Borrower or such
Subsidiary shall have set aside on its books adequate reserves with respect
thereto in accordance with GAAP; and provided further that the Borrower or such
Subsidiary will pay all such taxes, assessments, charges, levies or claims
forthwith upon the commencement of proceedings to foreclose any Lien that may
have attached as security therefor.
9.9. INSPECTION OF PROPERTIES AND BOOKS, ETC.
9.9.1. GENERAL. The Borrower shall permit the Lenders, through
the Administrative Agent or any of the Lenders' other designated
representatives, to visit and inspect any of the properties of the
Borrower or any of its Subsidiaries, to examine the books of account of
the Borrower and its Subsidiaries (and to make copies thereof and
extracts therefrom), and to discuss the affairs, finances and accounts
of the Borrower and its Subsidiaries with, and to be advised as to the
same by, its and their officers, all at such reasonable times and
intervals as the Administrative Agent or any Lender may reasonably
request.
9.9.2. APPRAISALS. Whether or not an Event of Default shall have
occurred, the Administrative Agent may, from time to time, in its
reasonable discretion, obtain appraisal reports prepared by appraisers
approved by the Administrative Agent stating (a) the then current fair
market, orderly liquidation and forced liquidation values of all or any
portion of the equipment or real estate owned by the Borrower or any of
its Subsidiaries and (b) the then current business value of each of the
Borrower and its Subsidiaries, such appraisals to be in a form
satisfactory to the Administrative Agent. All such appraisals shall be
conducted and made at the expense of the Borrower.
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9.9.3. ENVIRONMENTAL ASSESSMENTS. If the Administrative Agent
suspects an Event of Default has occurred, the Administrative Agent may,
from time to time, in its reasonable discretion for the purpose of
assessing and ensuring the value of any Mortgaged Property, obtain one
or more environmental assessments or audits of such Mortgaged Property
prepared by a nationally recognized hydrogeologist, an independent
engineer or other qualified consultant or expert approved by the
Administrative Agent to evaluate or confirm (a) whether any Hazardous
Materials are present in the soil or water at such Mortgaged Property
and (b) whether the use and operation of such Mortgaged Property
complies with all Environmental Laws. Such environmental assessments or
audits shall be conducted to the extent reasonably practicable, in a
manner that does not unreasonably interfere with the Borrower's or its
Subsidiaries use of the Mortgaged Property. The Administrative Agent's
right to conduct such environmental assessment or audit shall be subject
to all related restrictions in any applicable lease. Environmental
assessments may include without limitation detailed visual inspections
of such Mortgaged Property including any and all storage areas, storage
tanks, drains, dry xxxxx and leaching areas, and the taking of soil
samples, surface water samples and ground water samples, as well as such
other investigations or analyses as the Administrative Agent deems
reasonably appropriate. All such environmental assessments shall be
conducted and made at the expense of the Borrower.
9.9.4. COMMUNICATIONS WITH ACCOUNTANTS. The Borrower authorizes
the Administrative Agent and, if accompanied by the Administrative
Agent, the Lenders to communicate directly with the Borrower's
independent certified public accountants and authorizes such accountants
to disclose to the Administrative Agent and the Lenders any and all
financial statements and other supporting financial documents and
schedules including copies of any management letter with respect to the
business, financial condition and other affairs of the Borrower or any
of its Subsidiaries. At the request of the Administrative Agent, the
Borrower shall deliver a letter addressed to such accountants
instructing them to comply with the provisions of this Section 9.9.4.
9.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS. The
Borrower will, and will cause each of its Subsidiaries to, comply with (a) the
applicable laws and regulations wherever its business is conducted, including
all Environmental Laws, (b) the provisions of its Governing Documents, (c) all
agreements and instruments by which it or any of its properties may be bound and
(d) all applicable decrees, orders, and judgments, except in each case where the
failure to comply could not reasonably be expected to cause a Material Adverse
Effect. If any authorization, consent, approval, permit or license from any
officer, agency or instrumentality of any government shall become necessary or
required in order that the Borrower or any of its Subsidiaries may fulfill any
of its obligations hereunder or any of the other Loan Documents to which the
Borrower or such Subsidiary is a party, the Borrower will, or (as the case may
be) will cause such Subsidiary to, immediately take or cause to be taken all
reasonable steps within the power of the Borrower or such Subsidiary to obtain
such authorization, consent, approval, permit or license and furnish the
Administrative Agent and the Lenders with evidence thereof.
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9.11. EMPLOYEE BENEFIT PLANS. The Borrower will (a) promptly upon filing
the same with the Department of Labor or Internal Revenue Service upon request
of the Administrative Agent, furnish to the Administrative Agent a copy of the
most recent actuarial statement required to be submitted under Section 103(d) of
ERISA and Annual Report, Form 5500, with all required attachments, in respect of
each Guaranteed Pension Plan, and (b) promptly upon receipt or dispatch, furnish
to the Administrative Agent any notice, report or demand sent or received in
respect of a Guaranteed Pension Plan under Sections 302, 4041, 4042, 4043, 4063,
4065, 4066 and 4068 of ERISA, or in respect of a Multiemployer Plan, under
Sections 4041A, 4202, 4219, 4242, or 4245 of ERISA.
9.12. USE OF PROCEEDS. The Borrower will use the proceeds of the Loans
and obtain Letters of Credit solely for the purposes set forth in Section
8.17.1.
9.13. CONDUCT OF BUSINESS; STORES. The Borrower will, and will cause its
Subsidiaries to, continue to engage only in the business of owning and operating
"high-end casual" Italian restaurants and related retail markets and wholesale
bakeries in businesses and activities closely related thereto. The Borrower
shall inform the Lenders of any new Store locations simultaneously with the
delivery of the financial statements referred to in Section 9.4(c) but in any
event no later than one month after the opening of a new Store location and the
entering into a lease for, or the acquisition of, the premises for a new Store.
9.14. INTEREST RATE PROTECTION. Within ninety (90) days following the
Closing Date, to the extent necessary to fix or hedge interest rate fluctuations
on not less than fifty percent (50%) of the aggregate principal amount of all
Indebtedness for borrowed money of the Borrower and its Subsidiaries, the
Borrower will, and will cause its Subsidiaries to, enter into Interest Rate
Agreements to fix or hedge such interest rate fluctuations, such Interest Rate
Agreements to be on terms (including the tenor thereof) reasonably satisfactory
to the Administrative Agent.
9.15. BANK ACCOUNTS. On or prior to the Closing Date, the Borrower will,
and will cause each of its Subsidiaries to cause all cash receipts, checks and
cash proceeds of accounts receivable and other Collateral of the Borrower and
its Subsidiaries to be deposited only into (x) depository accounts with
financial institutions that have entered into agency account agreements in
substantially the form of Exhibit A to the Assignment and Agency Account
Agreement (such agency account agreements referred to herein as "Agency Account
Agreements" and such depository accounts with financial institutions that have
entered into such Agency Account Agreements referred to herein as "Agency
Accounts"), (y) the Concentration Accounts or (z) during the thirty (30) day
period following the Closing Date, an account scheduled on Schedule 8.24. The
Agency Account Agreements shall provide that at any time following the
occurrence of a Default or an Event of Default, the Administrative Agent shall
be entitled to direct the financial institutions party thereto to cause all
funds of the Borrower and its Subsidiaries held in the Agency Accounts at such
financial institutions to be transferred immediately and at any time thereafter
to the Administrative Agent to be applied to the Obligations or held as
Collateral, as the Administrative Agent deems appropriate. The Borrower shall
cause all cash receipts and checks in excess of $150,000 at each Store to be
deposited into an Agency Account, a Concentration Account or, during the thirty
(30) day period following the Closing Date, an account scheduled on Schedule
8.24, on at least two (2) separate Business Days during each week (a "week," for
the purposes of this Section 9.16, being
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deemed to begin at the beginning of each Monday and end at the end of the
following Friday) and (b) all funds in each Agency Account or any other account
of the Borrower or its Subsidiaries in excess of $10,000 to be deposited in the
Concentration Accounts on a daily basis on each Business Day. The Borrower shall
at all times maintain a Concentration Account with a financial institution that
has entered into an Agency Account Agreement with the Administrative Agent and
the Borrower that is in all respects satisfactory to the Administrative Agent.
No later than thirty (30) days following the Closing Date, the Borrower shall,
with respect to each account listed on Schedule 8.24, (i) cause such account to
become an Agency Account or (ii) terminate such account.
9.16. NEW SUBSIDIARIES. Any new Subsidiary of the Borrower created or
acquired after the Closing Date shall become a Borrower hereunder and become a
party to the Security Documents by (i) signing a joinder agreement, (ii) signing
allonges to the Revolving Credit Notes and the Term Notes in form and substance
satisfactory to the Administrative Agent, and (iii) providing such other
documentation as the Administrative Agent may reasonably request, including,
without limitation, Uniform Commercial Code searches and filings, legal opinions
and corporate authorization documentation with respect to such new Subsidiary
and other documentation with respect to the conditions specified in Section 12
hereof, and 100% of the equity interests and assets of each such new Subsidiary
shall be pledged to the Administrative Agent for the benefit of the Lenders and
the Administrative Agent. In such event, the Administrative Agent is hereby
authorized by the parties hereto to amend Schedule 8.19 to include each such new
Subsidiary.
9.17. MORTGAGED PROPERTY; NOTICE OF LEASES.
(a) The Borrower shall use commercially reasonable best efforts
to obtain landlord consents as to leasehold interests for each parcel of
Real Estate listed on Schedule 9.17(a), and shall, subject to receipt of
such landlord consents, deliver to the Administrative Agent within
thirty (30) days after the Closing Date, fully executed valid and
enforceable first priority leasehold mortgages free and clear of all
defects and encumbrances except for Permitted Liens for each such parcel
of Real Estate;
(b) If, after the Closing Date, the Borrower or any of its
Subsidiaries intends to lease for a term in excess of five (5) years
Real Estate, the Borrower shall use reasonable efforts to ensure that
such lease permits the Administrative Agent to obtain a first priority
leasehold mortgage over such leased Real Estate. Upon the execution of
such lease the Borrower or such Subsidiary shall promptly deliver to the
Administrative Agent a copy of such lease, and, to the extent permitted
by the applicable lease, the Borrower or such Subsidiary shall deliver,
within thirty (30) days of execution of such lease, to the
Administrative Agent, for the benefit of the Lenders and the
Administrative Agent, a fully executed, valid and enforceable first
priority leasehold mortgage over such leased Real Estate, free and clear
of all defects and encumbrances except for Permitted Liens.
(c) If, after the Closing Date, the Borrower or any of its
Subsidiaries leases Real Estate or any lease of Real Estate is extended
or otherwise modified in any respect, the Borrower shall, or shall cause
the applicable Subsidiary to, use its reasonable efforts
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to cause the relevant lessor to execute and deliver a notice of lease
(to the extent that a notice of lease is not already recorded in respect
of such lease) in form meeting all statutory and recording requirements
of the jurisdiction in which the relevant real property is located.
9.18. REPLACEMENT INSTRUMENTS. Upon receipt of an affidavit of an
officer of the Administrative Agent or any Lender as to the loss, theft,
destruction or mutilation of any Note, and, in the case of any such loss, theft,
destruction or mutilation, upon cancellation of such Note, the Borrower shall
issue, in lieu thereof, a replacement Note in the same principal amount thereof
and otherwise of like tenor.
9.19. FURTHER ASSURANCES. The Borrower will, and will cause each of its
Subsidiaries to, cooperate with the Lenders and the Administrative Agent and
execute such further instruments and documents as the Lenders or the
Administrative Agent shall reasonably request to carry out to their satisfaction
the transactions contemplated by this Credit Agreement and the other Loan
Documents.
10. CERTAIN NEGATIVE COVENANTS.
The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit or Note is outstanding or any Lender
has any obligation to make any Loans or the Administrative Agent has any
obligations to issue, extend or renew any Letters of Credit:
10.1. RESTRICTIONS ON INDEBTEDNESS. The Borrower will not nor will it
permit any of its Subsidiaries to, create, incur, assume, guarantee or be or
remain liable, contingently or otherwise, with respect to any Indebtedness other
than:
(a) Indebtedness to the Lenders and the Administrative Agent
arising under any of the Loan Documents;
(b) endorsements for collection, deposit or negotiation and
warranties of products or services, in each case incurred in the
ordinary course of business;
(c) the Subordinated Debt;
(d) Indebtedness incurred in connection with the acquisition
after the date hereof of any real or personal property by the Borrower
or such Subsidiary or under any Capitalized Lease, provided that the
aggregate principal amount of such Indebtedness of the Borrower and its
Subsidiaries shall not exceed the aggregate amount of $2,500,000 at any
one time, provided that no Default or Event of Default shall exist (i)
prior to the incurrence of such Indebtedness, or (ii) as a result of the
incurrence of such Indebtedness;
(e) Indebtedness in respect of Interest Rate Agreements entered
into in order to hedge interest rate fluctuations on Indebtedness for
borrowed money of the Borrower or its Subsidiaries and not for
speculative purposes;
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(f) Indebtedness consisting of contingent obligations of the
Borrower to repurchase or otherwise redeem capital stock of the Borrower
from former employees of the Borrower pursuant to the terms of employee
stock ownership, employee stock option or other employee compensation
plans of the Borrower and matured obligations to repurchase or otherwise
redeem such stock, in the case of each such repurchase or redemption, to
the extent such repurchase or redemption is permitted under Section
10.4(d);
(g) other Indebtedness in an aggregate principal amount at any
time outstanding not exceeding $1,000,000; provided, that no Event of
Default shall exist (i) prior to the incurrence of such Indebtedness or
(ii) as a result of the incurrence of such Indebtedness; and
(h) Indebtedness existing on the date hereof and listed and
described on Schedule 10.1 hereto.
10.2. RESTRICTIONS ON LIENS.
10.2.1. PERMITTED LIENS. The Borrower will not, nor will it
permit any of its Subsidiaries to, (a) create or incur or suffer to be created
or incurred or to exist any Lien upon any of its property or assets of any
character whether now owned or hereafter acquired, or upon the income or profits
therefrom; (b) transfer any of such property or assets or the income or profits
therefrom for the purpose of subjecting the same to the payment of Indebtedness
or performance of any other obligation in priority to payment of its general
creditors; (c) acquire, or agree or have an option to acquire, any property or
assets upon conditional sale or other title retention or purchase money security
agreement, device or arrangement; (d) suffer to exist for a period of more than
thirty (30) days after the same shall have been incurred any Indebtedness or
claim or demand against it that if unpaid might by law or upon bankruptcy or
insolvency, or otherwise, be given any priority whatsoever over its general
creditors; or (e) sell, assign, pledge or otherwise transfer any "receivables"
as defined in clause (g) of the definition of the term "Indebtedness," with or
without recourse; provided that the Borrower or any of its Subsidiaries may
create or incur or suffer to be created or incurred or to exist:
(i) Liens in favor of the Borrower on all or part of the assets
of Subsidiaries of the Borrower securing Indebtedness owing by
Subsidiaries of the Borrower to the Borrower;
(ii) Liens (A) to secure taxes, assessments and other government
charges in respect of obligations not overdue or (B) with respect to
assessments issued by governmental authorities or regulated utilities
for benefits rendered to the Real Estate, which assessments are payable
in installments over time, provided, however that such taxes,
assessments, installments or other governmental charges are not overdue
or are being contested in good faith and for which an adequate reserve
or other appropriate provisions shall have been made to the extent
required by GAAP;
(iii) deposits or pledges made in connection with, or to secure
payment of, workmen's compensation, unemployment insurance, old age
pensions or other social security obligations;
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(iv) Liens in respect of judgments or awards that have been in
force for less than the applicable period for taking an appeal so long
as execution is not levied thereunder or in respect of which the
Borrower or such Subsidiary shall at the time in good faith be
prosecuting an appeal or proceedings for review and in respect of which
a stay of execution shall have been obtained pending such appeal or
review;
(v) Liens of carriers, warehousemen, mechanics and materialmen,
and other like Liens on properties, in existence less than 120 days from
the date of creation thereof in respect of obligations not overdue or
which are being contested in good faith and for which an adequate
reserve or other appropriate provisions shall have been made to the
extent required by GAAP;
(vi) encumbrances on Real Estate consisting of easements, rights
of way, zoning restrictions, restrictions on the use of real property
and defects and irregularities in the title thereto, landlord's or
lessor's liens and other minor Liens, provided that none of such Liens
(A) interferes materially with the use of the property affected in the
ordinary conduct of the business of the Borrower and its Subsidiaries,
and (B) individually or in the aggregate have a Material Adverse Effect;
(vii) Liens existing on the date hereof and listed on Schedule
10.2 hereto;
(viii) purchase money security interests in or purchase money
mortgages on real or personal property acquired after the date hereof to
secure purchase money Indebtedness of the type and amount permitted by
Section 10.1(d), incurred in connection with the acquisition of such
property, which security interests or mortgages cover only the real or
personal property so acquired;
(ix) Liens on tenant improvements securing Indebtedness incurred
with respect thereto which is permitted under Section 10.1(d) and
Section 10.1(g);
(x) Liens in favor of the Administrative Agent for the benefit
of the Lenders and the Administrative Agent under the Loan Documents and
any Interest Rate Agreements.
10.2.2. RESTRICTIONS ON NEGATIVE PLEDGES AND UPSTREAM
LIMITATIONS. The Borrower will not, nor will it permit any of its Subsidiaries
to (a) enter into or permit to exist any arrangement or agreement (excluding the
Credit Agreement, the other Loan Documents and the Subordinated Loan Documents)
which directly or indirectly prohibits the Borrower or any of its Subsidiaries
from creating, assuming or incurring any Lien upon its properties, revenues or
assets or those of any of its Subsidiaries whether now owned or hereafter
acquired, or (b) enter into any agreement, contract or arrangement (excluding
the Credit Agreement, the other Loan Documents and the Subordinated Loan
Documents) restricting the ability of any Subsidiary of the Borrower to pay or
make dividends or distributions in cash or kind to the Borrower, to make loans,
advances or other payments of whatsoever nature to the Borrower, or to make
transfers or distributions of all or any part of its assets to the Borrower; in
each case other than (i) restrictions on specific assets which assets are the
subject of purchase money security interests to the extent permitted under
Section 10.2.1, and (ii) customary anti-assignment
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provisions contained in leases and licensing agreements entered into by the
Borrower or such Subsidiary in the ordinary course of its business.
10.3. RESTRICTIONS ON INVESTMENTS. The Borrower will not, nor will it
permit any of its Subsidiaries to, make or permit to exist or to remain
outstanding any Investment except Investments in:
(a) marketable direct or guaranteed obligations of the United
States of America that mature within one (1) year from the date of
purchase by the Borrower;
(b) demand deposits, certificates of deposit, bank acceptances
and time deposits of United States banks having total assets in excess
of $1,000,000,000;
(c) securities commonly known as "commercial paper" issued by a
corporation organized and existing under the laws of the United States
of America or any state thereof that at the time of purchase have been
rated and the ratings for which are not less than "P 1" if rated by
Xxxxx'x, and not less than "A 1" if rated by S&P;
(d) Investments existing on the date hereof and listed on
Schedule 10.3 hereto;
(e) Investments with respect to Indebtedness permitted by
Section 10.1(h);
(f) Investments by the Borrower and its Subsidiaries in respect
of any Interest Rate Agreement which is permitted by Section 10.1(e);
(g) Investments consisting of promissory notes received as
proceeds of asset dispositions permitted by Section 10.5.2, provided
that the aggregate value of such promissory notes received in connection
with any such asset disposition shall not exceed fifty percent (50%) of
the aggregate value of the proceeds of such asset disposition;
(h) Investments consisting of loans and advances to employees
for moving, entertainment, travel and other similar expenses in the
ordinary course of business not to exceed $250,000 in the aggregate at
any time outstanding; and
(i) Investments by the Borrower in any Subsidiary of the
Borrower which has complied with the provisions of Section 9.16;
provided, however, that, with the exception of demand deposits referred to in
Section 10.3(b), such Investments will be considered Investments permitted by
this Section 10.3 only if all actions have been taken to the satisfaction of the
Administrative Agent to provide to the Administrative Agent, for the benefit of
the Lenders and the Administrative Agent, a first priority perfected security
interest in all of such Investments free of all Liens other than Permitted
Liens.
10.4. RESTRICTED PAYMENTS. The Borrower will not, nor will it permit any
of its Subsidiaries to, make any Restricted Payments except the following:
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(a) Distributions payable by any Subsidiary of the Borrower to
the Borrower and by the Borrower to any Subsidiary of the Borrower, so
long as such Subsidiary has complied with the provisions of Section
9.16;
(b) so long as no Default or Event of Default is continuing or
would result therefrom, management fees and expenses payable to BRS or
any BRS Affiliate in accordance with the Management Agreement as in
effect on the Closing Date;
(c) mandatory payments under the Subordinated Loan Documents, in
each case, not prohibited by the applicable subordination provisions
contained therein;
(d) so long as no Event of Default is then continuing,
Distributions in an amount not to exceed $500,000 per annum and
$1,500,000 in the aggregate during the term of the Credit Agreement to
be used to repurchase or otherwise redeem capital stock of the Borrower
from former employees of the Borrower pursuant to the terms of employee
stock ownership, employee stock option or other employee compensation
plans of the Borrower; provided that the portion of such Distributions
equal to cash payments received by the Borrower from the subsequent sale
of such repurchased or redeemed capital stock for cash to any employee
of the Borrower at the commencement of such Person's employment shall
not be deemed to be a Distribution for purposes of this Section 10.4(d);
and
(e) any payment of shares of Capital Stock of the Borrower made
to the Rollover Group (as defined in the Merger Agreement) in accordance
with the terms of the option agreements between the members of the
Rollover Group and the Borrower in connection with the exercise by any
such members of such options.
10.5. MERGER, CONSOLIDATION AND DISPOSITION OF ASSETS.
10.5.1. MERGERS AND CONSOLIDATIONS. Subject to Section 10.5.3,
the Borrower will not, nor will it permit any of its Subsidiaries to,
become a party to any merger or consolidation except the merger or
consolidation of one or more of the Subsidiaries of the Borrower with
and into the Borrower, or the merger or consolidation of two or more
Subsidiaries of the Borrower.
10.5.2. DISPOSITIONS OF ASSETS. The Borrower will not, nor will
it permit any of its Subsidiaries to, become a party to or agree to or
effect any disposition of assets, other than (a) the sale of inventory
and the disposition of obsolete assets, in each case in the ordinary
course of business consistent with past practices, (b) Sale-Leaseback
transactions permitted pursuant to Section 10.6, and (c) the sale of up
to four (4) Unprofitable Stores during the term of the Credit Agreement,
provided that the proceeds of such sales are reinvested or committed to
be reinvested in new or existing Stores within two hundred seventy (270)
days thereafter or are used to prepay the Obligations pursuant to
Section 4.3.3. Nothing in this Section 10.5.2 is intended to prohibit
the Borrower or any of its Subsidiaries from conditionally agreeing to
dispose of any assets subject to the prior approval of the Required
Lenders (or all of the Lenders in the case of the sale of any portion of
the Collateral subject to Section 17.12(a)(iv)) if the Borrower or such
Subsidiary will
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not be subject to any penalties in connection with such agreement in the
event that the Required Lenders (or all of the Lenders, as the case may
require) do not consent to such disposition. The Administrative Agent
may release any Collateral disposed of by the Borrower or any of its
Subsidiaries if such disposition is in compliance with this Section
10.5.2 and otherwise with the terms hereof.
10.5.3. ACQUISITIONS. The Borrower will not, nor will it permit
any of its Subsidiaries to, agree to or effect any asset acquisition or
stock acquisition except (a) Growth Capital Expenditures permitted
pursuant to Section 11.6, (b) Maintenance Capital Expenditures incurred
in the ordinary course of business to maintain the assets of the
Borrower or to insure compliance with applicable laws and regulations,
and (c) the acquisition of inventory, equipment, furnishings and other
similar assets (not including Stores or real property) in the ordinary
course of business consistent with past practices.
10.6. SALE AND LEASEBACK. The Borrower will not, nor will it permit any
of its Subsidiaries to, enter into any arrangement, directly or indirectly,
whereby the Borrower or such Subsidiary shall sell or transfer any property
owned by it in order then or thereafter to lease such property or lease other
property that the Borrower or such Subsidiary intends to use for substantially
the same purpose as the property being sold or transferred (a "Sale-Leaseback");
provided that, so long as no Event of Default has occurred and is continuing,
the Borrower and its Subsidiaries may enter into Sale-Leaseback transactions
with respect to property and equipment in an aggregate amount not to exceed
$2,500,000 in the aggregate; provided further that (a) the terms of the sale as
such are comparable to terms which could be obtained in an arms length sale
among unaffiliated parties not involving a Sale-Leaseback transaction, (b) the
terms of the lease as such are comparable to terms which could be obtained in an
arms length commercial operating lease among unaffiliated parties and (c) the
proceeds of such Sale-Leaseback transaction are applied in accordance with
Section 4.3.2.
10.7. COMPLIANCE WITH ENVIRONMENTAL LAWS. The Borrower will not, nor
will it permit any of its Subsidiaries to, (a) use any of the Real Estate or any
portion thereof for the handling, processing, storage or disposal of Hazardous
Substances, except in material compliance with Environmental Laws (b) cause or
permit to be located on any of the Real Estate any underground tank or other
underground storage receptacle for Hazardous Substances, except in material
compliance with Environmental Laws (c) generate any Hazardous Substances on any
of the Real Estate, except in material compliance with Environmental Laws (d)
conduct any activity at any Real Estate or use any Real Estate in any manner so
as to cause a release (i.e. releasing, spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, disposing or
dumping) or threatened release of Hazardous Substances on, upon or into the Real
Estate except in material compliance with Environmental Laws or (e) otherwise
conduct any activity at any Real Estate or use any Real Estate in any manner
that would materially violate any Environmental Law or bring such Real Estate in
material violation of any Environmental Law.
10.8. SUBORDINATED DEBT. The Borrower will not, and will not permit any
of its Subsidiaries to, amend, supplement or otherwise modify (pursuant to a
waiver or otherwise) the terms of any of the Subordinated Loan Documents which
(a) amendment, supplement or modification (i) effects any increase in the
principal amount of the Subordinated Debt except
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through the issuance of Put Notes (as defined in the Subordinated Loan
Agreement) or the issuance of additional notes in payment of interest on the
Subordinated Debt at the rate otherwise in effect thereunder, (ii) effects in
any increase in the interest rate thereon or any fees thereunder, (iii) shortens
the maturity or average life to maturity thereof, adds or modifies the terms of
any required prepayments, redemptions, or repurchases (other than waivers or
deferrals thereof), (iv) modifies the terms of the subordination provisions
thereof, or (v) makes materially more burdensome to the Borrower or any of its
Subsidiaries covenants therein or adds additional such covenants or events of
default or (b) which amendment, supplement or modification relates to other
terms and provisions of the Subordinated Loan Documents and the cumulative
effect of which is to make the Subordinated Loan Documents more restrictive on
the Borrower or any of its Subsidiaries, or adversely affects the Administrative
Agent's or any Lender's rights or interests thereunder or under the Loan
Documents or the Borrower's or any of its Subsidiaries' ability to fulfill its
obligations under the Loan Documents. The Borrower will not, nor will it permit
any of its Subsidiaries to, prepay, redeem or repurchase or make any payment in
defeasance of any of the Subordinated Debt or send any notice of voluntary
redemption, prepayment, repurchase or redemption or defeasance with respect to
any of the Subordinated Debt. The terms of the Subordinated Debt and the
Subordinated Loan Documents may be amended, supplemented or otherwise modified
(a) solely to conform or correspond to amendments made to this Credit Agreement
and the other Loan Documents or (b) to waive defaults thereunder or to amend
covenants in order to make them less restrictive on the Borrower and its
Subsidiaries.
10.9. EMPLOYEE BENEFIT PLANS. Neither the Borrower nor any ERISA
Affiliate will:
(a) engage in any "prohibited transaction" within the meaning of
Section 406 of ERISA or Section 4975 of the Code which could result in a
material liability for the Borrower or any of its Subsidiaries; or
(b) permit any Guaranteed Pension Plan to incur an "accumulated
funding deficiency", as such term is defined in Section 302 of ERISA,
whether or not such deficiency is or may be waived; or
(c) fail to contribute to any Guaranteed Pension Plan to an
extent which, or terminate any Guaranteed Pension Plan in a manner
which, could result in the imposition of a lien or encumbrance on the
assets of the Borrower or any of its Subsidiaries pursuant to Section
302(f) or Section 4068 of ERISA; or
(d) amend any Guaranteed Pension Plan in circumstances requiring
the posting of security pursuant to Section 307 of ERISA or Section
401(a)(29) of the Code;
(e) permit or take any action which would result in the
aggregate benefit liabilities (with the meaning of Section 4001 of
ERISA) of all Guaranteed Pension Plans exceeding the value of the
aggregate assets of such Plans, disregarding for this purpose the
benefit liabilities and assets of any such Plan with assets in excess of
benefit liabilities; or
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(f) permit or take any action which would contravene any
Applicable Pension Legislation.
10.10. BUSINESS ACTIVITIES. The Borrower will not, nor will it permit
any of its Subsidiaries to, engage directly or indirectly (whether through
Subsidiaries or otherwise) in any type of business other than the businesses
conducted by them on the Closing Date and in related businesses.
10.11. FISCAL YEAR. The Borrower will not, nor will it permit any of it
Subsidiaries to, change the date of the end of its fiscal year from that set
forth in Section 8.4.1.
10.12. TRANSACTIONS WITH AFFILIATES. The Borrower will not, nor will it
permit any of its Subsidiaries to, engage in any transaction with any Affiliate
(other than for services as employees, officers and directors), including any
contract, agreement or other arrangement providing for the furnishing of
services to or by, providing for rental of real or personal property to or from,
or otherwise requiring payments to or from any such Affiliate or, to the
knowledge of the Borrower, any corporation, partnership, trust or other entity
in which any such Affiliate has a substantial interest or is an officer,
director, trustee or partner, on terms more favorable to such Person than would
have been obtainable on an arm's-length basis in the ordinary course of
business, provided that so long as no Default or Event of Default is continuing
the foregoing restriction shall not apply to management fees and expenses
permitted by Section 10.4(b) or payment of shares of Capital Stock as provided
in Section 10.4(e).
10.13. BANK ACCOUNTS. The Borrower will not, nor will it permit any of
its Subsidiaries to, (a) establish any bank accounts after the Closing Date
other than the Agency Accounts and the Concentration Accounts without the
Administrative Agent's prior written consent provided that the Borrower may
maintain the accounts scheduled on Schedule 8.24 hereof for thirty (30) days
after the Closing Date whether or not they are, during such period, Agency
Accounts; (b) violate directly or indirectly the Agency Account Agreement, any
Agency Account Agreement or other bank agency or lock box agreement in favor of
the Administrative Agent for the benefit of the Lenders and the Administrative
Agent with respect to such account; or (iii) deposit into any of the payroll
accounts listed on Schedule 8.24 any amounts in excess of amounts necessary to
pay current payroll obligations from such accounts.
10.14. MERGER DOCUMENTS. The Borrower will not, nor will it permit any
of its Subsidiaries to, materially amend, supplement or otherwise modify
(pursuant to a waiver or otherwise) the terms and conditions of any of the
Merger Documents without the prior written consent of the Required Lenders.
11. FINANCIAL COVENANTS.
The Borrower covenants and agrees that, so long as any Loan, Unpaid
Reimbursement Obligation, Letter of Credit or Note is outstanding or any Lender
has any obligation to make any Loans or the Administrative Agent has any
obligation to issue, extend or renew any Letters of Credit:
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11.1. LEVERAGE RATIO. The Borrower will not permit the Leverage Ratio,
as at the end of any Reference Period ending during any period described in the
table set forth below, to be greater than the ratio set forth opposite such
period in such table:
------------------------------------------------- --------------------
Period
(inclusive of end dates) Ratio
------------------------------------------------- --------------------
Closing Date through September 30, 2001 3.50:1.00
October 1, 2001 through December 31, 2001 3.30:1.00
January 1, 2002 through June 30, 2002 3.25:1.00
July 1, 2002 through December 31, 2002 3.15:1.00
January 1, 2003 through June 30, 2003 2.85:1.00
July 1, 2003 through December 31, 2003 2.60:1.00
January 1, 2004 through June 30, 2004 2.35:1.00
July 1, 2004 through December 31, 2004 2.10:1.00
January 1, 2005 through June 30, 2005 1.85:1.00
Thereafter 1.60:1.00
------------------------------------------------- --------------------
11.2. SENIOR LEVERAGE RATIO. The Borrower will not permit the Senior
Leverage Ratio, as at the end of any Reference Period ending during any period
described in the table set forth below, to be greater than the ratio set forth
opposite such period in such table:
------------------------------------------------- --------------------
Period
(inclusive of end dates) Ratio
------------------------------------------------- --------------------
Closing Date through September 30, 2001 2.50:1.00
October 1, 2001 through December 31, 2001 2.25:1.00
January 1, 2002 through June 30, 2002 2.15:1.00
July 1, 2002 through December 31, 2002 2.05:1.00
January 1, 2003 through June 30, 2003 1.85:1.00
July 1, 2003 through December 31, 2003 1.65:1.00
January 1, 2004 through June 30, 2004 1.50:1.00
July 1, 2004 through December 31, 2004 1.30:1.00
January 1, 2005 through June 30, 2005 1.15:1.00
Thereafter 1.00:1.00
------------------------------------------------- --------------------
11.3. CASH FLOW RATIO. The Borrower will not permit the Cash Flow Ratio,
for any Reference Period ending during any period described in the table set
forth below, to be less than the ratio set forth opposite such period in such
table:
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------------------------------------------------- --------------------
Period Ratio
(inclusive of end dates)
------------------------------------------------- --------------------
Closing Date through June 30, 2002 1.35:1.00
July 1, 2002 through December 31, 2002 1.40:1.00
January 1, 2003 through June 30, 2003 1.45:1.00
July 1, 2003 through December 31, 2003 1.55:1.00
January 1, 2004 through June 30, 2004 1.65:1.00
July 1, 2004 through December 31, 2004 1.75:1.00
January 1, 2005 through June 30, 2005 1.85:1.00
Thereafter 1.95:1.00
------------------------------------------------- --------------------
11.4. EBITDAR TO TOTAL INTEREST EXPENSE AND RENTAL EXPENSE. The Borrower
will not permit the ratio of (a) Consolidated EBITDAR for any Reference Period
ending during any period described in the table set forth below to (b) the sum
of (i) Consolidated Total Interest Expense for such Reference Period plus (ii)
Consolidated Rental Expense for such Reference Period, to be less than the ratio
set forth opposite such period in such table:
------------------------------------------------- --------------------
Period
(inclusive of end dates) Ratio
------------------------------------------------- --------------------
Closing Date through September 30, 2001 1.55:1.00
October 1, 2001 through December 31, 2001 1.70:1.00
January 1, 2002 through June 30, 2002 1.75:1.00
July 1, 2002 through December 31, 2002 1.80:1.00
January 1, 2003 through June 30, 2003 1.85:1.00
July 1, 2003 through December 31, 2003 1.90:1.00
January 1, 2004 through June 30, 2004 2.00:1.00
July 1, 2004 through December 31, 2004 2.10:1.00
January 1, 2005 through June 30, 2005 2.20:1.00
Thereafter 2.25:1.00
------------------------------------------------- --------------------
11.5. GROWTH CAPITAL EXPENDITURES. The Borrower will not make, and will
not permit any of its Subsidiaries to make, aggregate Growth Capital
Expenditures during (a) the period commencing on the Closing Date and ending on
the last day of the fiscal year ending on or about December 31, 2001, in excess
of $3,500,000 for such period, (b) the fiscal years ending or about December 31,
2002 and December 31, 2003, in excess of $7,500,000 per annum and (b) and in any
fiscal year thereafter, in excess of $10,000,000 per annum, provided that the
maximum Growth Capital Expenditures in any fiscal year after the fiscal year
ending on or about December 31, 2001 shall be increased by seventy-five percent
(75%) of the unused portion of Growth Capital Expenditures from the previous
fiscal year (calculated without reference to any amounts carried forward from
prior years pursuant to this provision). Notwithstanding the foregoing, at any
time when the Senior Leverage Ratio of the Borrower and its Subsidiaries for the
most recently ended period of four (4) consecutive fiscal quarters is greater
than 1.50:1.00, then neither the Borrower, nor any of its Subsidiaries shall be
permitted to incur any uncommitted Growth Capital Expenditures unless the Senior
Leverage Ratio is at least twenty-five (25) basis points lower that the covenant
level required for such period pursuant to Section 11.2.
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12. CLOSING CONDITIONS.
The obligations of the Lenders to make the initial Revolving Credit
Loans and the Term Loan and of the Administrative Agent to issue any initial
Letters of Credit shall be subject to the satisfaction of the following
conditions precedent:
12.1. LOAN DOCUMENTS ETC.
12.1.1. LOAN DOCUMENTS. Each of the Loan Documents (other than
the Assignment and Agency Account Agreement) shall have been duly
executed and delivered by the respective parties thereto, shall be in
full force and effect and shall be in form and substance satisfactory to
each of the Lenders. The Administrative Agent shall have received a
fully executed copy of each such document.
12.1.2. SUBORDINATED LOAN DOCUMENTS. Each of the Subordinated
Loan Documents shall have been duly executed and delivered by the
respective parties thereto, shall be in full force and effect and shall
be in form and substance satisfactory to each of the Lenders. The
Administrative Agent shall have received a fully executed copy of each
such document.
12.1.3. EQUITY DOCUMENTS. Each of the Equity Documents shall
have been duly executed and delivered by the respective parties thereto,
shall be in full force and effect and shall be in form and substance
satisfactory to each of the Lenders. The Administrative Agent shall have
received a fully executed copy of each such document.
12.1.4. MERGER DOCUMENTS. Each of the Merger Documents shall
have been duly executed and delivered by the respective parties thereto,
shall be in full force and effect and shall be in form and substance
reasonably satisfactory to each of the Lenders. The Administrative Agent
shall have received a fully executed copy of each such document,
certified by the Borrower to be true, complete and accurate as of the
Closing Date.
12.2. CERTIFIED COPIES OF GOVERNING DOCUMENTS. Each of the Lenders shall
have received from the Borrower and each of its Subsidiaries a copy, certified
by a duly authorized officer of such Person to be true and complete on the
Closing Date, of each of its Governing Documents as in effect on such date of
certification.
12.3. CORPORATE OR OTHER ACTION. All corporate (or other) action
necessary for the valid execution, delivery and performance by the Borrower and
each of its Subsidiaries of this Credit Agreement and the other Loan Documents
to which it is or is to become a party shall have been duly and effectively
taken, and evidence thereof satisfactory to the Lenders shall have been provided
to each of the Lenders.
12.4. INCUMBENCY CERTIFICATE. Each of the Lenders shall have received
from the Borrower and each of its Subsidiaries and BRS an incumbency
certificate, dated as of the Closing Date, signed by a duly authorized officer
of the Borrower, such Subsidiary or BRS, and giving the name and bearing a
specimen signature of each individual who shall be authorized: (a) to sign, in
the name and on behalf of the Borrower, such Subsidiary or BRS, each of the Loan
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Documents to which the Borrower, such Subsidiary or BRS is or is to become a
party; (b) in the case of the Borrower, to make Loan Requests and Conversion
Requests and to apply for Letters of Credit; and (c) to give notices and to take
other action on its behalf under the Loan Documents.
12.5. VALIDITY OF LIENS. The Security Documents shall be effective to
create in favor of the Administrative Agent a legal, valid and enforceable first
(except for Permitted Liens entitled to priority under applicable law) security
interest in and Lien upon the Collateral. All filings, recordings, deliveries of
instruments and other actions necessary or desirable in the opinion of the
Administrative Agent to protect and preserve such security interests shall have
been duly effected (other than in respect of Mortgages to be delivered following
the Closing Date). The Administrative Agent shall have received evidence thereof
in form and substance satisfactory to the Administrative Agent.
12.6. PERFECTION CERTIFICATES AND UCC SEARCH RESULTS. The Administrative
Agent shall have received from the Borrower and each of its Subsidiaries a
completed and fully executed Perfection Certificate and the results of UCC
searches (and the equivalent thereof in all applicable foreign jurisdictions)
with respect to the Collateral, indicating no Liens other than Permitted Liens
and otherwise in form and substance satisfactory to the Administrative Agent.
12.7. CERTIFICATES OF INSURANCE. The Administrative Agent shall have
received (a) a certificate of insurance from an independent insurance broker
dated as of the Closing Date, identifying insurers, types of insurance,
insurance limits, and policy terms, and otherwise describing the insurance
obtained in accordance with the provisions of the Security Agreements and (b)
certified copies of all policies evidencing such insurance (or certificates
therefore signed by the insurer or an agent authorized to bind the insurer).
12.8. ENVIRONMENTAL DUE DILIGENCE. The Administrative Agent shall have
received environmental transaction screening reports performed by an
environmental consultant reasonably acceptable to the Administrative Agent in
accordance with ASTM standards in form and substance satisfactory to the
Administrative Agent covering all Real Estate and all ground leases which
constitute Real Estate.
12.9. SOLVENCY CERTIFICATE. Each of the Lenders shall have received an
officer's certificate of the Borrower dated as of the Closing Date as to the
solvency of the Borrower and its Subsidiaries following the consummation of the
transactions contemplated herein and in form and substance satisfactory to the
Lenders.
12.10. OPINION OF COUNSEL. Each of the Lenders and the Administrative
Agent shall have received:
(a) a favorable legal opinion addressed to the Lenders and the
Administrative Agent, dated as of the Closing Date, in form and
substance satisfactory to the Lenders and the Administrative Agent, from
Dechert, counsel to the Borrower;
(b) copies of each of the legal opinions delivered upon the
consummation of the Merger by counsel to the respective parties to the
Merger Documents, each in form
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and substance satisfactory to the Administrative Agent, together with
reliance letters with respect thereto addressed to the Lenders and the
Administrative Agent.
(c) copies of each of the legal opinions delivered in connection
with the execution and delivery of the Subordinated Loan Documents by
counsel to the respective parties to the Subordinated Loan Documents,
each in form and substance satisfactory to the Administrative Agent,
together with reliance letters with respect thereto addressed to the
Lenders and the Administrative Agent.
(d) copies of each of the legal opinions delivered by counsel to
the Borrower in connection with the execution and delivery of the Equity
Documents by counsel to the respective parties to the Equity Documents,
each in form and substance satisfactory to the Administrative Agent,
together with reliance letters with respect thereto addressed to the
Lenders and the Administrative Agent.
12.11. PAYMENT OF FEES. The Borrower shall have paid to the Lenders or
the Administrative Agent, as appropriate, all Fees due hereunder and under the
Fee Letter The Borrower shall have reimbursed the Administrative Agent for, or
paid directly, all fees, costs and expenses incurred by the Administrative
Agent's Special Counsel in connection with the closing of the transactions
contemplated hereby.
12.12. TERMINATION OF EXISTING CREDIT FACILITIES. The Administrative
Agent shall have received evidence reasonably satisfactory to it that the Loan
Agreement, dated as of October 12, 2000 between ILFO and Xxxxx Fargo Bank, N.A.
has been terminated.
12.13. CAPITAL STRUCTURE. The Administrative Agent shall be satisfied
with the capital structure of the Borrower and its Subsidiaries. Without
limiting the foregoing, on the Closing Date, the Borrower shall have (a)
received gross proceeds from the issuance of the Subordinated Debt in an amount
equal to $13,000,000, which proceeds will be applied to finance the purchase
price of the Merger, (b) received $38,000,000 in cash equity investments from
the issuance of common stock and Preferred Stock on terms acceptable to the
Administrative Agent, and (c) on a pro forma basis after giving effect to the
Merger, Consolidated EBITDA of at least $13,000,000 on the Closing Date.
12.14. DISBURSEMENT INSTRUCTIONS. The Administrative Agent shall have
received disbursement instructions from the Borrower with respect to the
proceeds of the Term Loan and the initial Revolving Credit Loans to be made on
the Closing Date.
12.15. NO MATERIAL ADVERSE CHANGE. The Administrative Agent shall be
satisfied that there shall have occurred no material adverse change in (a) the
business, operations, assets, properties, financial condition or income of ILFO
and its Subsidiaries taken as a whole since the Interim Balance Sheet Date, (b)
in the management or prospects of ILFO or the Borrower, or (c) in the ability of
ILFO or the Borrower to perform their respective obligations under the
Transaction Documents.
12.16. FINANCIAL STATEMENTS AND PROJECTIONS. The Administrative Agent
shall have received copies of the financial statements and projections described
in Section 8.4, and the
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Administrative Agent shall be satisfied that such financial statements fairly
present the financial condition of the Borrower and (a) a satisfactory pro forma
balance sheet of the Borrower and its Subsidiaries dated as of the Closing Date,
showing the effects of the Merger and evidencing pro forma compliance with the
financial covenants contained is Section 11, (b) its Subsidiaries as at the
close of business on the date thereof and the results of operations for the
fiscal period then ended. With respect to ILFO and its Subsidiaries, the
Administrative Agent shall have received (in form and substance satisfactory to
it) consolidated audited financial statements for the preceding three fiscal
years, (c) material reserve reviews, and (d) environmental review reports. The
Administrative Agent shall have received a statement of the sources and uses of
funds in connection with the Merger, and such statement of sources and uses
shall be satisfactory in all material respects to the Administrative Agent.
12.17. NO LITIGATION. No litigation, inquiry, injunction or restraining
order shall be pending, entered or threatened that, in the reasonable opinion of
the Administrative Agent, could reasonably be expected to have a material
adverse effect on (i) the transactions contemplated hereby or by the Merger,
(ii) the business, assets, liabilities (actual or contingent) operations,
condition (financial or otherwise) of the Borrower and its Subsidiaries, taken
as a whole, (iii) the ability of the Borrower or any of its Subsidiaries to
perform their obligations under the Loan Documents, (iv) the rights and remedies
of the Administrative Agent and the Lenders under the Loan Documents, or (v) the
perfection or priority of any security interests granted to the Administrative
Agent under the Loan Documents.
12.18. CONSENTS AND APPROVALS. The Administrative Agent shall have
received evidence that all material governmental and third-party approvals
(including liquor licenses and other consents to the extent reasonably
obtainable) necessary or advisable in connection with the Merger and the credit
facilities contemplated hereby and the continuing operations of the Borrower
shall have been obtained and shall be in full force and effect, and all
applicable waiting periods shall have expired without any action being taken or
threatened by any competent authority that would restrain, prevent or otherwise
impose materially adverse conditions on the Borrower and its Subsidiaries taken
as a whole, the Merger or the credit facilities contemplated hereby.
12.19. MANAGEMENT AGREEMENTS; EMPLOYMENT AGREEMENTS. There shall have
been made available for review by the Administrative Agent and the Lenders true
and correct copies of (a) the Management Agreement and any other material
agreement with respect to the management of the Borrower or any of its
Subsidiaries; and (b) any material employment agreements entered into by the
Borrower or any of its Subsidiaries, with all of the foregoing to be
satisfactory to the Lenders.
12.20. OTHER DOCUMENTATION. All other documentation, including any tax
sharing agreements or other financing arrangements of the Borrower and its
Subsidiaries, shall be reasonably satisfactory in form and substance to the
Administrative Agent.
12.21. CLOSING OF MERGER. The Merger shall have been duly consummated on
or prior to the Closing Date in accordance with the terms of the Merger
Documents in all material respects and, after giving effect thereto, (a) BRS or
the BRS Affiliates shall, directly or indirectly, own at least fifty-one percent
(51%) of the issued and outstanding common stock of ILFO, and
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(b) ILFO shall, directly or indirectly, own one hundred percent (100%) of the
equity of each of its Subsidiaries. The Administrative Agent shall have received
evidence, reasonably satisfactory to it, of the completion by the parties to the
Merger Documents of all actions to be taken prior to or concurrently with the
closing of the transactions contemplated thereby pursuant to the terms thereof,
including without limitation, the satisfaction or, to the extent consented to in
writing by the Administrative Agent, waiver, of all conditions to closing set
forth in the Merger Agreement and the payment by each applicable party thereto
of all amounts required to be paid at closing and the satisfaction in full of
all Indebtedness to be repaid in connection with the Merger. The Administrative
Agent shall have received evidence, reasonably satisfactory to it, that all
material consents and approvals necessary to complete the Merger shall have been
obtained and such consents and approvals shall be in form and substance
reasonably satisfactory to the Administrative Agent. The Administrative Agent
shall have received evidence, reasonably satisfactory to it, that the
Certificate of Merger relating to the Merger has been filed and is effective
with the Secretary of State of the State of Delaware; the Borrower hereby
agreeing to deliver a copy thereof to the Administrative Agent as soon as
practicable. Without limiting the foregoing, the Administrative Agent shall have
received evidence, reasonably satisfactory to it of the satisfaction of all
requirements under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended, and the regulations promulgated thereunder. The Merger shall have been
consummated for an aggregate purchase price (including all amounts used for the
retirement of existing Indebtedness) not exceeding $86,900,000 plus fees and
expenses. The aggregate amount of all such fees and expenses incurred in
connection with the Merger shall not exceed $8,600,000. On the Closing Date,
outstanding Revolving Credit Loans shall not exceed $3,500,000 in the aggregate.
12.22. PROCEEDINGS AND DOCUMENTS. All proceedings in connection with the
transactions contemplated by this Credit Agreement, the other Loan Documents and
all other documents incident thereto shall be satisfactory in substance and in
form to the Lenders and to the Administrative Agent and the Administrative
Agent's Special Counsel, and the Lenders, the Administrative Agent and such
counsel shall have received all information and such counterpart originals or
certified or other copies of such documents as the Administrative Agent may
reasonably request.
13. CONDITIONS TO ALL BORROWINGS.
The obligations of the Lenders to make any Loan, including the Revolving
Credit Loan and the Term Loan, and of the Administrative Agent to issue, extend
or renew any Letter of Credit, in each case whether on or after the Closing
Date, shall also be subject to the satisfaction of the following conditions
precedent:
13.1. REPRESENTATIONS TRUE; NO EVENT OF DEFAULT. Each of the
representations and warranties of the Borrower and its Subsidiaries contained in
this Credit Agreement, the other Loan Documents or in any document or instrument
delivered pursuant to or in connection with this Credit Agreement shall be true
as of the date as of which they were made and shall also be true at and as of
the time of the making of such Loan or the issuance, extension or renewal of
such Letter of Credit, with the same effect as if made at and as of that time
(except to the extent of changes resulting from transactions contemplated or
permitted by this Credit Agreement and the other Loan Documents and changes
occurring in the ordinary course of business that singly
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or in the aggregate are not materially adverse, and to the extent that such
representations and warranties relate expressly to an earlier date) and no
Default or Event of Default shall have occurred and be continuing.
13.2. NO LEGAL IMPEDIMENT. No change shall have occurred in any law or
regulations thereunder or interpretations thereof that in the reasonable opinion
of any Lender would make it illegal for such Lender to make such Loan or to
participate in the issuance, extension or renewal of such Letter of Credit or in
the reasonable opinion of the Administrative Agent would make it illegal for the
Administrative Agent to issue, extend or renew such Letter of Credit.
14. EVENTS OF DEFAULT; ACCELERATION; ETC.
14.1. EVENTS OF DEFAULT AND ACCELERATION. If any of the following events
("Events of Default" or, if the giving of notice or the lapse of time or both is
required, then, prior to such notice or lapse of time, "Defaults") shall occur:
(a) the Borrower shall fail to pay any principal of the Loans or
any Reimbursement Obligation when the same shall become due and payable,
whether at the stated date of maturity or any accelerated date of
maturity or at any other date fixed for payment;
(b) the Borrower or any of its Subsidiaries shall fail to pay
any interest on the Loans, any Fees, or other sums due hereunder or
under any of the other Loan Documents, when the same shall become due
and payable, whether at the stated date of maturity or any accelerated
date of maturity or at any other date fixed for payment;
(c) the Borrower shall fail to comply with any of its respective
covenants contained in Sections 9.5, 9.7.1, 9.9, 10 or 11 (except as to
the covenants contained in Section 10.7, for which the Borrower's
failure to comply shall only be deemed an Event of Default should the
Borrower fail to cure the failure within the earlier of thirty (30) days
or the time period required by Environmental Laws), with any of its
covenants contained in Section 9.4 for a period in excess of five (5)
days, or with any of the covenants contained in any of the Mortgages for
three (3) days.
(d) the Borrower or any of its Subsidiaries shall fail to
perform any term, covenant or agreement contained herein or in any of
the other Loan Documents (other than those specified elsewhere in this
Section 14.1) for thirty (30) days after written notice of such failure
has been given to the Borrower by the Administrative Agent;
(e) any representation or warranty of the Borrower or any of its
Subsidiaries in this Credit Agreement or any of the other Loan Documents
or in any other document or instrument delivered pursuant to or in
connection with this Credit Agreement shall prove to have been false in
any material respect upon the date when made or deemed to have been made
or repeated;
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(f) the Borrower or any of its Subsidiaries shall fail to pay at
maturity, or within any applicable period of grace, any obligation for
borrowed money or credit received or in respect of any Capitalized
Leases in an aggregate amount in excess of $500,000, or fail to observe
or perform any material term, covenant or agreement contained in any
agreement by which it is bound, evidencing or securing borrowed money or
credit received or in respect of any Capitalized Leases in an aggregate
amount in excess of $500,000 for such period of time as would permit
(assuming the giving of appropriate notice if required) the holder or
holders thereof or of any obligations issued thereunder to accelerate
the maturity thereof, or any such holder or holders shall rescind or
shall have a right to rescind the purchase of any such obligations;
(g) the Borrower or any of its Subsidiaries shall make an
assignment for the benefit of creditors, or admit in writing its
inability to pay or generally fail to pay its debts as they mature or
become due, or shall petition or apply for the appointment of a trustee
or other custodian, liquidator or receiver of the Borrower or any of its
Subsidiaries or of any substantial part of the assets of the Borrower or
any of its Subsidiaries or shall commence any case or other proceeding
relating to the Borrower or any of its Subsidiaries under any
bankruptcy, reorganization, arrangement, insolvency, readjustment of
debt, dissolution or liquidation or similar law of any jurisdiction, now
or hereafter in effect, or shall take any action to authorize or in
furtherance of any of the foregoing, or if any such petition or
application shall be filed or any such case or other proceeding shall be
commenced against the Borrower or any of its Subsidiaries and the
Borrower or any of its Subsidiaries shall indicate its approval thereof,
consent thereto or acquiescence therein or such petition or application
shall not have been dismissed within forty-five (45) days following the
filing thereof;
(h) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating the Borrower or any of
its Subsidiaries bankrupt or insolvent, or approving a petition in any
such case or other proceeding, or a decree or order for relief is
entered in respect of the Borrower or any of its Subsidiaries in an
involuntary case under federal bankruptcy laws as now or hereafter
constituted;
(i) there shall remain in force, undischarged, unsatisfied and
unstayed, for more than thirty (30) days, whether or not consecutive,
any final judgment against the Borrower or any of its Subsidiaries that,
with other outstanding final judgments, undischarged, against the
Borrower or any of its Subsidiaries exceeds in the aggregate $500,000;
(j) the holders of all or any part of the Subordinated Debt
shall accelerate the maturity of all or any part of the Subordinated
Debt, the Subordinated Debt shall be prepaid, redeemed or repurchased in
whole or in part or an offer to prepay, redeem or repurchase the
Subordinated Debt in whole or in part shall have been made;
(k) if any of the Loan Documents shall be cancelled, terminated,
revoked or rescinded or the Administrative Agent's security interests,
mortgages or liens in a substantial portion of the Collateral shall
cease to be perfected, or shall cease to have the priority contemplated
by the Security Documents, in each case otherwise than in
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accordance with the terms thereof or with the express prior written
agreement, consent or approval of the Lenders, or any action at law,
suit or in equity or other legal proceeding to cancel, revoke or rescind
any of the Loan Documents shall be commenced by or on behalf of the
Borrower or any of its Subsidiaries party thereto or any of their
respective stockholders, or any court or any other governmental or
regulatory authority or agency of competent jurisdiction shall make a
determination that, or issue a judgment, order, decree or ruling to the
effect that, any one or more of the Loan Documents is illegal, invalid
or unenforceable in accordance with the terms thereof;
(l) the Borrower or any ERISA Affiliate incurs any liability to
the PBGC or a Guaranteed Pension Plan pursuant to Title IV of ERISA in
an aggregate amount exceeding $500,000 or the Borrower or any ERISA
Affiliate is assessed withdrawal liability pursuant to Title IV of ERISA
by a Multiemployer Plan requiring aggregate annual payments exceeding
$500,000, or any of the following occurs with respect to a Guaranteed
Pension Plan: (i) an ERISA Reportable Event, or a failure to make a
required installment or other payment (within the meaning of Section
302(f)(1) of ERISA), provided that the Administrative Agent determines
in its reasonable discretion that such event (A) could be expected to
result in liability of the Borrower or any of its Subsidiaries to the
PBGC or such Guaranteed Pension Plan in an aggregate amount exceeding
$500,000 and (B) could constitute grounds for the termination of such
Guaranteed Pension Plan by the PBGC, for the appointment by the
appropriate United States District Court of a trustee to administer such
Guaranteed Pension Plan or for the imposition of a lien in favor of such
Guaranteed Pension Plan; or (ii) the appointment by a United States
District Court of a trustee to administer such Guaranteed Pension Plan;
or (iii) the institution by the PBGC of proceedings to terminate such
Guaranteed Pension Plan;
(m) the Borrower or any of its Subsidiaries shall be enjoined,
restrained or in any way prevented by the order of any Governmental
Authority from conducting any material part of its business and such
order shall continue in effect for more than thirty (30) days;
(n) there shall occur any material damage to, or loss, theft or
destruction of, any Collateral, whether or not insured, or any strike,
lockout, labor dispute, embargo, condemnation, act of God or public
enemy, or other casualty, which in any such case causes, for more than
fifteen (15) consecutive days, the cessation or substantial curtailment
of revenue producing activities at any facility of the Borrower or any
of its Subsidiaries if such event or circumstance is not covered by
business interruption insurance and would have a Material Adverse
Effect;
(o) there shall occur the loss, suspension or revocation of, or
failure to renew, any license or permit now held or hereafter acquired
by the Borrower or any of its Subsidiaries if such loss, suspension,
revocation or failure to renew would have a Material Adverse Effect;
(p) the Borrower or any of its Subsidiaries shall be indicted
for a state or federal crime, or any civil or criminal action shall
otherwise have been brought against the Borrower or any of its
Subsidiaries, a punishment for which in any such case could
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include the forfeiture of any assets of the Borrower or such Subsidiary
having a fair market value in excess of $500,000; or
(q) a Change of Control shall occur;
then, and in any such event, so long as the same may be continuing, the
Administrative Agent may, and upon the request of the Required Lenders shall, by
notice in writing to the Borrower declare all amounts owing with respect to this
Credit Agreement, the Notes and the other Loan Documents and all Reimbursement
Obligations to be, and they shall thereupon forthwith become, immediately due
and payable without presentment, demand, protest or other notice of any kind,
all of which are hereby expressly waived by the Borrower; provided that in the
event of any Event of Default specified in Sections 14.1(g), 14.1(h) or 14.1(j),
all such amounts shall become immediately due and payable automatically and
without any requirement of notice from the Administrative Agent or any Lender.
14.2. TERMINATION OF COMMITMENTS. If any one or more of the Events of
Default specified in Section 14.1(g), Section 14.1(h) or Section 14.1(j) shall
occur, any unused portion of the credit hereunder shall forthwith terminate and
each of the Lenders shall be relieved of all further obligations to make Loans
to the Borrower and the Administrative Agent shall be relieved of all further
obligations to issue, extend or renew Letters of Credit. If any other Event of
Default shall have occurred and be continuing, or if on any Drawdown Date or
other date for issuing, extending or renewing any Letter of Credit the
conditions precedent to the making of the Loans to be made on such Drawdown Date
or (as the case may be) to issuing, extending or renewing such Letter of Credit
on such other date are not satisfied, the Administrative Agent may and, upon the
request of the Required Lenders, shall, by notice to the Borrower, terminate the
unused portion of the credit hereunder, and upon such notice being given such
unused portion of the credit hereunder shall terminate immediately and each of
the Lenders shall be relieved of all further obligations to make Loans and the
Administrative Agent shall be relieved of all further obligations to issue,
extend or renew Letters of Credit. No termination of the credit hereunder shall
relieve the Borrower or any of its Subsidiaries of any of the Obligations.
14.3. REMEDIES. In case any one or more of the Events of Default shall
have occurred and be continuing, and whether or not the Lenders shall have
accelerated the maturity of the Loans pursuant to Section 14.1, each Lender, if
owed any amount with respect to the Loans or the Reimbursement Obligations, may,
with the consent of the Required Lenders but not otherwise, proceed to protect
and enforce its rights by suit in equity, action at law or other appropriate
proceeding, whether for the specific performance of any covenant or agreement
contained in this Credit Agreement and the other Loan Documents or any
instrument pursuant to which the Obligations to such Lender are evidenced,
including as permitted by applicable law the obtaining of the ex parte
appointment of a receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any other
legal or equitable right of such Lender. No remedy herein conferred upon any
Lender or the Administrative Agent or the holder of any Note or purchaser of any
Letter of Credit Participation is intended to be exclusive of any other remedy
and each and every remedy shall be cumulative and shall be in addition to every
other remedy given hereunder or now or hereafter existing at law or in equity or
by statute or any other provision of law.
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14.4. DISTRIBUTION OF COLLATERAL PROCEEDS. In the event that following
the occurrence or during the continuance of any Default or Event of Default, the
Administrative Agent or any Lender, as the case may be, receives any monies in
connection with the enforcement of any the Security Documents, or otherwise with
respect to the realization upon any of the Collateral, such monies shall be
distributed for application as follows:
(a) First, to the payment of, or (as the case may be) the
reimbursement of the Administrative Agent for or in respect of all
reasonable costs, expenses, disbursements and losses which shall have
been incurred or sustained by the Administrative Agent in connection
with the collection of such monies by the Administrative Agent, for the
exercise, protection or enforcement by the Administrative Agent of all
or any of the rights, remedies, powers and privileges of the
Administrative Agent under this Credit Agreement or any of the other
Loan Documents or in respect of the Collateral or in support of any
provision of adequate indemnity to the Administrative Agent against any
taxes or liens which by law shall have, or may have, priority over the
rights of the Administrative Agent to such monies;
(b) Second, to all other Obligations in such order or preference
as the Required Lenders may determine; provided, however, that (i)
distributions shall be made (A) pari passu among Obligations with
respect to the Administrative Agent's Fee and all other Obligations and
(B) with respect to each type of Obligation owing to the Lenders, such
as interest, principal, fees and expenses, among the Lenders pro rata,
and (ii) the Administrative Agent may in its discretion make proper
allowance to take into account any Obligations not then due and payable;
(c) Third, upon payment and satisfaction in full or other
provisions for payment in full satisfactory to the Lenders and the
Administrative Agent of all of the Obligations, to the payment of any
obligations required to be paid pursuant to Section 9-504(1)(c) of the
Uniform Commercial Code of the Commonwealth of Massachusetts; and
(d) Fourth, the excess, if any, shall be returned to the
Borrower or to such other Persons as are entitled thereto.
15. THE ADMINISTRATIVE AGENT.
15.1. AUTHORIZATION.
(a) The Administrative Agent is authorized to take such action
on behalf of each of the Lenders and to exercise all such powers as are
hereunder and under any of the other Loan Documents and any related
documents delegated to the Administrative Agent, together with such
powers as are reasonably incident thereto, including the authority,
without the necessity of any notice to or further consent of the
Lenders, from time to time to take any action with respect to any
Collateral or the Security Documents which may be necessary to perfect,
maintain perfected or insure the priority of the security interest in
and liens upon the Collateral granted pursuant to the Security
Documents, provided that no duties or responsibilities not expressly
assumed herein or therein shall be implied to have been assumed by the
Administrative Agent.
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(b) The relationship between the Administrative Agent and each
of the Lenders is that of an independent contractor. The use of the term
"Administrative Agent" is for convenience only and is used to describe,
as a form of convention, the independent contractual relationship
between the Administrative Agent and each of the Lenders. Nothing
contained in this Credit Agreement nor the other Loan Documents shall be
construed to create an agency, trust or other fiduciary relationship
between the Administrative Agent and any of the Lenders.
(c) As an independent contractor empowered by the Lenders to
exercise certain rights and perform certain duties and responsibilities
hereunder and under the other Loan Documents, the Administrative Agent
is nevertheless a "representative" of the Lenders, as that term is
defined in Article 1 of the Uniform Commercial Code, for purposes of
actions for the benefit of the Lenders and the Administrative Agent with
respect to all collateral security and guaranties contemplated by the
Loan Documents. Such actions include the designation of the
Administrative Agent as "secured party", "mortgagee" or the like on all
financing statements and other documents and instruments, whether
recorded or otherwise, relating to the attachment, perfection, priority
or enforcement of any security interests, mortgages or deeds of trust in
collateral security intended to secure the payment or performance of any
of the Obligations, all for the benefit of the Lenders and the
Administrative Agent.
15.2. EMPLOYEES AND ADMINISTRATIVE AGENTS. The Administrative Agent may
exercise its powers and execute its duties by or through employees or agents and
shall be entitled to take, and to rely on, advice of counsel concerning all
matters pertaining to its rights and duties under this Credit Agreement and the
other Loan Documents. The Administrative Agent may utilize the services of such
Persons as the Administrative Agent in its sole discretion may reasonably
determine, and all reasonable fees and expenses of any such Persons shall be
paid by the Borrower.
15.3. NO LIABILITY. Neither the Administrative Agent nor any of its
shareholders, directors, officers or employees nor any other Person assisting
them in their duties nor any agent or employee thereof, shall be liable for any
waiver, consent or approval given or any action taken, or omitted to be taken,
in good faith by it or them hereunder or under any of the other Loan Documents,
or in connection herewith or therewith, or be responsible for the consequences
of any oversight or error of judgment whatsoever, except that the Administrative
Agent or such other Person, as the case may be, may be liable for losses due to
its willful misconduct or gross negligence.
15.4. NO REPRESENTATIONS.
15.4.1. GENERAL. The Administrative Agent shall not be
responsible for the execution or validity or enforceability of this
Credit Agreement, the Notes, the Letters of Credit, any of the other
Loan Documents or any instrument at any time constituting, or intended
to constitute, collateral security for the Notes, or for the value of
any such collateral security or for the validity, enforceability or
collectability of any such amounts owing with respect to the Notes, or
for any recitals or statements, warranties or representations made
herein or in any of the other Loan Documents or in any certificate
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or instrument hereafter furnished to it by or on behalf of the Borrower
or any of its Subsidiaries, or be bound to ascertain or inquire as to
the performance or observance of any of the terms, conditions, covenants
or agreements herein or in any instrument at any time constituting, or
intended to constitute, collateral security for the Notes or to inspect
any of the properties, books or records of the Borrower or any of its
Subsidiaries. The Administrative Agent shall not be bound to ascertain
whether any notice, consent, waiver or request delivered to it by the
Borrower or any holder of any of the Notes shall have been duly
authorized or is true, accurate and complete. The Administrative Agent
has not made nor does it now make any representations or warranties,
express or implied, nor does it assume any liability to the Lenders,
with respect to the credit worthiness or financial conditions of the
Borrower or any of its Subsidiaries. Each Lender acknowledges that it
has, independently and without reliance upon the Administrative Agent or
any other Lender, and based upon such information and documents as it
has deemed appropriate, made its own credit analysis and decision to
enter into this Credit Agreement.
15.4.2. CLOSING DOCUMENTATION, ETC. For purposes of determining
compliance with the conditions set forth in Section 12, each Lender that
has executed this Credit Agreement shall be deemed to have consented to,
approved or accepted, or to be satisfied with, each document and matter
either sent, or made available, by the Administrative Agent or the
Arranger to such Lender for consent, approval, acceptance or
satisfaction, or required thereunder to be to be consent to or approved
by or acceptable or satisfactory to such Lender, unless an officer of
the Administrative Agent or the Arranger active upon the Borrower's
account shall have received notice from such Lender prior to the Closing
Date specifying such Lender's objection thereto and such objection shall
not have been withdrawn by notice to the Administrative Agent or the
Arranger to such effect on or prior to the Closing Date.
15.5. PAYMENTS.
15.5.1. PAYMENTS TO ADMINISTRATIVE AGENT. A payment by the
Borrower to the Administrative Agent hereunder or any of the other Loan
Documents for the account of any Lender shall constitute a payment to
such Lender. The Administrative Agent agrees promptly to distribute to
each Lender such Lender's pro rata share of payments received by the
Administrative Agent for the account of the Lenders except as otherwise
expressly provided herein or in any of the other Loan Documents.
15.5.2. DISTRIBUTION BY ADMINISTRATIVE AGENT. If in the opinion
of the Administrative Agent the distribution of any amount received by
it in such capacity hereunder, under the Notes or under any of the other
Loan Documents might involve it in liability, it may refrain from making
distribution until its right to make distribution shall have been
adjudicated by a court of competent jurisdiction. If a court of
competent jurisdiction shall adjudge that any amount received and
distributed by the Administrative Agent is to be repaid, each Person to
whom any such distribution shall have been made shall either repay to
the Administrative Agent its proportionate share of the amount so
adjudged to be repaid or shall pay over the same in such manner and to
such Persons as shall be determined by such court.
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15.5.3. DELINQUENT LENDERS. Notwithstanding anything to the
contrary contained in this Credit Agreement or any of the other Loan
Documents, any Lender that fails (a) to make available to the
Administrative Agent its pro rata share of any Loan or to purchase any
Letter of Credit Participation or (b) to comply with the provisions of
Section 17.1 with respect to making dispositions and arrangements with
the other Lenders, where such Lender's share of any payment received,
whether by setoff or otherwise, is in excess of its pro rata share of
such payments due and payable to all of the Lenders, in each case as,
when and to the full extent required by the provisions of this Credit
Agreement, shall be deemed delinquent (a "Delinquent Lender") and shall
be deemed a Delinquent Lender until such time as such delinquency is
satisfied. A Delinquent Lender shall be deemed to have assigned any and
all payments due to it from the Borrower, whether on account of
outstanding Loans, Unpaid Reimbursement Obligations, interest, fees or
otherwise, to the remaining nondelinquent Lenders for application to,
and reduction of, their respective pro rata shares of all outstanding
Loans and Unpaid Reimbursement Obligations. The Delinquent Lender hereby
authorizes the Administrative Agent to distribute such payments to the
nondelinquent Lenders in proportion to their respective pro rata shares
of all outstanding Loans and Unpaid Reimbursement Obligations. A
Delinquent Lender shall be deemed to have satisfied in full a
delinquency when and if, as a result of application of the assigned
payments to all outstanding Loans and Unpaid Reimbursement Obligations
of the nondelinquent Lenders, the Lenders' respective pro rata shares of
all outstanding Loans and Unpaid Reimbursement Obligations have returned
to those in effect immediately prior to such delinquency and without
giving effect to the nonpayment causing such delinquency.
15.6. HOLDERS OF NOTES. The Administrative Agent may deem and treat the
payee of any Note or the purchaser of any Letter of Credit Participation as the
absolute owner or purchaser thereof for all purposes hereof until it shall have
been furnished in writing with a different name by such payee or by a subsequent
holder, assignee or transferee.
15.7. INDEMNITY. The Lenders ratably agree hereby to indemnify and hold
harmless the Administrative Agent and its affiliates from and against any and
all claims, actions and suits (whether groundless or otherwise), losses,
damages, costs, expenses (including any expenses for which the Administrative
Agent or such affiliate has not been reimbursed by the Borrower as required by
Section 17.2), and liabilities of every nature and character arising out of or
related to this Credit Agreement, the Notes, or any of the other Loan Documents
or the transactions contemplated or evidenced hereby or thereby, or the
Administrative Agent's actions taken hereunder or thereunder, except to the
extent that any of the same shall be directly caused by the Administrative
Agent's willful misconduct or gross negligence.
15.8. ADMINISTRATIVE AGENT AS LENDER. In its individual capacity, Fleet
shall have the same obligations and the same rights, powers and privileges in
respect to its Commitment and the Loans made by it, and as the holder of any of
the Notes and as the purchaser of any Letter of Credit Participations, as it
would have were it not also the Administrative Agent. The Syndication Agent
shall have no obligation, liability, responsibility or duty under this Agreement
other than as applicable to it as a Lender.
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15.9. RESIGNATION. The Administrative Agent may resign at any time by
giving sixty (60) days prior written notice thereof to the Lenders and the
Borrower. Upon any such resignation, the Required Lenders shall have the right
to appoint a successor Administrative Agent. Unless a Default or Event of
Default shall have occurred and be continuing, such successor Administrative
Agent shall be reasonably acceptable to the Borrower. If no successor
Administrative Agent shall have been so appointed by the Required Lenders and
shall have accepted such appointment within thirty (30) days after the retiring
Administrative Agent's giving of notice of resignation, then the retiring
Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, which shall be a financial institution having a rating of
not less than A or its equivalent by S&P. Upon the acceptance of any appointment
as Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties
and obligations hereunder. After any retiring Administrative Agent's
resignation, the provisions of this Credit Agreement and the other Loan
Documents shall continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as Administrative Agent.
15.10. NOTIFICATION OF DEFAULTS AND EVENTS OF DEFAULT. Each Lender
hereby agrees that, upon learning of the existence of a Default or an Event of
Default, it shall promptly notify the Administrative Agent thereof. The
Administrative Agent hereby agrees that upon receipt of any notice under this
Section 15.10 it shall promptly notify the other Lenders of the existence of
such Default or Event of Default.
15.11. DUTIES IN THE CASE OF ENFORCEMENT. In case one of more Events of
Default have occurred and shall be continuing, and whether or not acceleration
of the Obligations shall have occurred, the Administrative Agent shall, if (a)
so requested by the Required Lenders and (b) the Lenders have provided to the
Administrative Agent such additional indemnities and assurances against expenses
and liabilities as the Administrative Agent may reasonably request, proceed to
enforce the provisions of the Security Documents authorizing the sale or other
disposition of all or any part of the Collateral and exercise all or any such
other legal and equitable and other rights or remedies as it may have in respect
of such Collateral. The Required Lenders may direct the Administrative Agent in
writing as to the method and the extent of any such sale or other disposition,
the Lenders hereby agreeing to indemnify and hold the Administrative Agent,
harmless from all liabilities incurred in respect of all actions taken or
omitted in accordance with such directions, provided that the Administrative
Agent need not comply with any such direction to the extent that the
Administrative Agent reasonably believes the Administrative Agent's compliance
with such direction to be unlawful or commercially unreasonable in any
applicable jurisdiction.
16. ASSIGNMENT AND PARTICIPATION.
16.1. CONDITIONS TO ASSIGNMENT BY LENDERS.
16.1.1. ASSIGNMENT BY LENDERS. Except as provided herein, each
Lender may assign to one or more Eligible Assignees, all or a portion of
its interests, rights and obligations under this Credit Agreement
(including all or a portion of its Commitment
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Percentage and Commitment and the same portion of the Loans at the time
owing to it, the Notes held by it and its participating interest in the
risk relating to any Letters of Credit); provided that (a) each of the
Administrative Agent and, unless a Default or Event of Default shall
have occurred and be continuing, the Borrower shall have given its prior
written consent to such assignment, which consent, in the case of the
Borrower, will not be unreasonably withheld; except that the consent of
the Borrower or the Administrative Agent shall not be required in
connection with any assignment by a Lender to (i) an existing Lender or
(ii) a Lender Affiliate of such Lender, (b) each such assignment shall
be of a constant, and not a varying, percentage of all the assigning
Lender's rights and obligations under this Credit Agreement, it being
understood that non-pro rata assignments of the Commitments, the
Revolving Credit Loans and the Term Loan are not permitted, (c) each
assignment (or, in the case of assignments by a Lender to its Lender
Affiliates, the aggregate holdings of such Lender and its Lender
Affiliates after giving effect to such assignments), shall be in an
amount that is a whole multiple of $1,000,000 and (d) the parties to
such assignment shall execute and deliver to the Administrative Agent,
for recording in the Register (as hereinafter defined), an Assignment
and Acceptance, substantially in the form of Exhibit E hereto (an
"Assignment and Acceptance"), together with any Notes subject to such
assignment. Upon such execution, delivery, acceptance and recording,
from and after the effective date specified in each Assignment and
Acceptance, which effective date shall be at least five (5) Business
Days after the execution thereof, (y) the assignee thereunder shall be a
party hereto and, to the extent provided in such Assignment and
Acceptance, have the rights and obligations of a Lender hereunder, and
(z) the assigning Lender shall, to the extent provided in such
assignment and upon payment to the Administrative Agent of the
registration fee referred to in Section 16.3, be released from its
obligations under this Credit Agreement.
16.1.2. ACCESSION. Except as otherwise provided herein, any
lender or other financial institution (each, an "Acceding Bank") may at
any time prior to July 17, 2002, at the request of the Borrower and with
the consent of the Administrative Agent, become party to this Credit
Agreement by entering into an Instrument of Accession in substantially
the form of Exhibit F hereto (an "Instrument of Accession") with the
Borrower and the Administrative Agent and assuming thereunder a
Revolving Credit Commitment, in an amount to be agreed upon by the
Borrower, such Acceding Bank and the Administrative Agent, to make
Revolving Credit Loans and participate in the risk relating to the
Letters of Credit pursuant to the terms hereof, and the Total Commitment
shall thereupon be increased by the amount of such Acceding Bank's
Commitment; provided, however, that (a) the Administrative Agent shall
have given its prior written consent to such accession, and (b) in no
event shall the Total Commitment be increased under any one or more of
such Instruments of Accession so as to exceed, in the aggregate,
$17,500,000. On the effective date specified in any Instrument of
Accession, Schedule 1 hereto shall be deemed to be amended to reflect
(a) the name, address, Commitment and Commitment Percentage of such
Acceding Bank, (b) the Total Commitment as increased by such Acceding
Bank's Commitment, and (c) the changes to the other Lender respective
Commitment Percentages and any changes to the
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other Lender respective Commitments (in the event such Lender is also
the Acceding Bank) resulting from such assumption and such increased
Total Commitment.
16.2. CERTAIN REPRESENTATIONS AND WARRANTIES; LIMITATIONS; COVENANTS. By
executing and delivering an Assignment and Acceptance, the parties to the
assignment thereunder confirm to and agree with each other and the other parties
hereto as follows:
(a) other than the representation and warranty that it is the
legal and beneficial owner of the interest being assigned thereby free
and clear of any adverse claim, the assigning Lender makes no
representation or warranty, express or implied, and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Credit Agreement or
the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Credit Agreement, the other Loan Documents
or any other instrument or document furnished pursuant hereto or the
attachment, perfection or priority of any security interest or mortgage,
(b) the assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower and its Subsidiaries or any other Person primarily or
secondarily liable in respect of any of the Obligations, or the
performance or observance by the Borrower and its Subsidiaries or any
other Person primarily or secondarily liable in respect of any of the
Obligations of any of their obligations under this Credit Agreement or
any of the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto;
(c) such assignee confirms that it has received a copy of this
Credit Agreement, together with copies of the most recent financial
statements referred to in Section 8.4 and Section 9.4 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;
(d) such assignee will, independently and without reliance upon
the assigning Lender, the Administrative Agent or any other Lender and
based on such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or not
taking action under this Credit Agreement;
(e) such assignee appoints and authorizes the Administrative
Agent to take such action as agent on its behalf and to exercise such
powers under this Credit Agreement and the other Loan Documents as are
delegated to the Administrative Agent by the terms hereof or thereof,
together with such powers as are reasonably incidental thereto;
(f) such assignee agrees that it will perform in accordance with
their terms all of the obligations that by the terms of this Credit
Agreement are required to be performed by it as a Lender;
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(g) such assignee represents and warrants that it is an Eligible
Assignee and that it is legally authorized to enter into such Assignment
and Acceptance;
(h) such assignee acknowledges that it has made arrangements
with the assigning Lender satisfactory to such assignee with respect to
its pro rata share of Letter of Credit Fees in respect of outstanding
Letters of Credit; and
(i) such assignee, if organized under the laws of a jurisdiction
outside the United States, shall provide the Administrative Agent and
the Borrower with the forms prescribed by the Internal Revenue Service
of the United States certifying as to its status for purposes of
determining the applicability of any exemption from United States
withholding taxes with respect to all payments to be made hereunder to
such assignee or any other documents reasonably satisfactory to the
Borrower and the Administrative Agent indicating that all payments to be
made hereunder to such assignee are subject to such tax at a rate
reduced by an applicable tax treaty. Unless the Borrower and the
Administrative Agent have received such forms or such documents validly
indicating that payments hereunder are not subject to United States
withholding tax or are subject to such tax at a rate reduced by an
applicable tax treaty, the Borrower or the Administrative Agent shall
withhold taxes from such payments at the applicable statutory rate in
the case of payments to or for any assignee organized under the laws of
a jurisdiction outside the United States in accordance with Section
6.2.2.
16.3. REGISTER. The Administrative Agent shall maintain a copy of each
Assignment and Acceptance delivered to it and a register or similar list (the
"Register") for the recordation of the names and addresses of the Lenders and
the Commitment Percentage of, and principal amount of the Revolving Credit Loans
owing to and Letter of Credit Participations purchased by, the Lenders from time
to time. The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, the Administrative Agent and the Lenders may
treat each Person whose name is recorded in the Register as a Lender hereunder
for all purposes of this Credit Agreement. The Register shall be available for
inspection by the Borrower and the Lenders at any reasonable time and from time
to time upon reasonable prior notice. Upon each such recordation, the assigning
Lender agrees to pay to the Administrative Agent a registration fee in the sum
of $3,500.
16.4. NEW NOTES. Upon its receipt of an Assignment and Acceptance
executed by the parties to such assignment, together with each Note subject to
such assignment, the Administrative Agent shall (a) record the information
contained therein in the Register, and (b) give prompt notice thereof to the
Borrower and the Lenders (other than the assigning Lender). Within five (5)
Business Days after receipt of such notice, the Borrower, at its own expense,
shall execute and deliver to the Administrative Agent, in exchange for each
surrendered Note, a new Note to the order of such Assignee in an amount equal to
the amount assumed by such Assignee pursuant to such Assignment and Acceptance
and, if the assigning Lender has retained some portion of its obligations
hereunder, a new Note to the order of the assigning Lender in an amount equal to
the amount retained by it hereunder. Such new Notes shall provide that they are
replacements for the surrendered Notes, shall be in an aggregate principal
amount equal to the aggregate principal amount of the surrendered Notes, shall
be dated the effective date of such Assignment and Acceptance and shall
otherwise be in substantially the
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form of the assigned Notes. Within five (5) days of issuance of any new Notes
pursuant to this Section 16.4, the Borrower shall deliver upon the request of
the assignee Lender an opinion of counsel, addressed to the Lenders and the
Administrative Agent, relating to the due authorization, execution and delivery
of such new Notes and the legality, validity and binding effect thereof, in form
and substance satisfactory to the Lenders. The surrendered Notes shall be
cancelled and returned to the Borrower.
16.5. PARTICIPATIONS. Each Lender may sell participations to one or more
Lenders or other entities in all or a portion of such Lender's rights and
obligations under this Credit Agreement and the other Loan Documents; provided
that (a) each such participation shall be in an amount of not less than
$1,000,000, (b) any such sale or participation shall not affect the rights and
duties of the selling Lender hereunder to the Borrower and (c) the only rights
granted to the participant pursuant to such participation arrangements with
respect to waivers, amendments or modifications of the Loan Documents shall be
the rights to approve waivers, amendments or modifications that would reduce the
principal of or the interest rate on any Loans, extend the term or increase the
amount of the Commitment of such Lender as it relates to such participant,
reduce the amount of any Commitment Fee or Letter of Credit Fees to which such
participant is entitled or extend any regularly scheduled payment date for
principal or interest.
16.6. ASSIGNEE OR PARTICIPANT AFFILIATED WITH THE BORROWER. If any
assignee Lender is an Affiliate of the Borrower, then any such assignee Lender
shall have no right to vote as a Lender hereunder or under any of the other Loan
Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or other modifications to any of the Loan Documents or
for purposes of making requests to the Administrative Agent pursuant to Section
14.1 or Section 14.2, and the determination of the Required Lenders shall for
all purposes of this Credit Agreement and the other Loan Documents be made
without regard to such assignee Lender's interest in any of the Loans or
Reimbursement Obligations. If any Lender sells a participating interest in any
of the Loans or Reimbursement Obligations to a participant, and such participant
is the Borrower or an Affiliate of the Borrower, then such transferor Lender
shall promptly notify the Administrative Agent of the sale of such
participation. A transferor Lender shall have no right to vote as a Lender
hereunder or under any of the other Loan Documents for purposes of granting
consents or waivers or for purposes of agreeing to amendments or modifications
to any of the Loan Documents or for purposes of making requests to the
Administrative Agent pursuant to Section 14.1 or Section 14.2 to the extent that
such participation is beneficially owned by the Borrower or any Affiliate of the
Borrower, and the determination of the Required Lenders shall for all purposes
of this Credit Agreement and the other Loan Documents be made without regard to
the interest of such transferor Lender in the Loans or Reimbursement Obligations
to the extent of such participation.
16.7. MISCELLANEOUS ASSIGNMENT PROVISIONS. Any assigning Lender shall
retain its rights to be indemnified pursuant to Section 17.3 with respect to any
claims or actions arising prior to the date of such assignment. If any Reference
Lender transfers all of its interest, rights and obligations under this Credit
Agreement, the Administrative Agent shall, in consultation with the Borrower and
with the consent of the Borrower and the Required Lenders, appoint another
Lender to act as a Reference Lender hereunder. Anything contained in this
Section 16 to the contrary
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notwithstanding, any Lender may at any time pledge or assign a security interest
in all or any portion of its interest and rights under this Credit Agreement
(including all or any portion of its Notes) to secure obligations of such
Lender, including any pledge or assignment to secure obligations to (a) any of
the twelve Federal Reserve Banks organized under Section 4 of the Federal
Reserve Act, 12 U.S.C. Section 341 and (b) with respect to any Lender that is a
fund that invests in bank loans, to any lender or any trustee for, or any other
representative of, holders of obligations owed or securities issued by such fund
as security for such obligations or securities or any institutional custodian
for such fund or for such lender. Any foreclosure or similar action by any
Person in respect of such pledge or assignment shall be subject to the other
provisions of this Section 16. No such pledge or the enforcement thereof shall
release the pledgor Lender from its obligations hereunder or under any of the
other Loan Documents, provide any voting rights hereunder to the pledgee
thereof, or affect any rights or obligations of the Borrower or Administrative
Agent hereunder.
16.8. ASSIGNMENT BY BORROWER. No Borrower shall assign or transfer any
of its rights or obligations under any of the Loan Documents without the prior
written consent of each of the Lenders.
17. PROVISIONS OF GENERAL APPLICATIONS.
17.1. SETOFF. The Borrower hereby grants to the Administrative Agent and
each of the Lenders a continuing lien, security interest and right of setoff as
security for all liabilities and obligations to the Administrative Agent and
each Lender, whether now existing or hereafter arising, upon and against all
deposits, credits, collateral and property, now or hereafter in the possession,
custody, safekeeping or control of the Administrative Agent or such Lender or
any Lender Affiliate and their successors and assigns or in transit to any of
them. Regardless of the adequacy of any collateral, if any of the Obligations
are due and payable and have not been paid or any Event of Default shall have
occurred, any deposits or other sums credited by or due from any of the Lenders
to the Borrower and any securities or other property of the Borrower in the
possession of such Lender may be applied to or set off by such Lender against
the payment of Obligations and any and all other liabilities, direct, or
indirect, absolute or contingent, due or to become due, now existing or
hereafter arising, of the Borrower to such Lender. ANY AND ALL RIGHTS TO REQUIRE
ANY LENDER TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER
COLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF
SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF THE BORROWER
ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED. Each of the Lenders
agree with each other Lender that (a) if an amount to be set off is to be
applied to Indebtedness of the Borrower to such Lender, other than Indebtedness
evidenced by the Notes held by such Lender or constituting Reimbursement
Obligations owed to such Lender, such amount shall be applied ratably to such
other Indebtedness and to the Indebtedness evidenced by all such Notes held by
such Lender or constituting Reimbursement Obligations owed to such Lender, and
(b) if such Lender shall receive from the Borrower, whether by voluntary
payment, exercise of the right of setoff, counterclaim, cross action,
enforcement of the claim evidenced by the Notes held by, or constituting
Reimbursement Obligations owed to, such Lender by proceedings against the
Borrower at law or in equity or by proof thereof in bankruptcy, reorganization,
liquidation, receivership or similar proceedings, or otherwise, and shall retain
and apply to the payment of
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the Note or Notes held by, or Reimbursement Obligations owed to, such Lender any
amount in excess of its ratable portion of the payments received by all of the
Lenders with respect to the Notes held by, and Reimbursement Obligations owed
to, all of the Lenders, such Lender will make such disposition and arrangements
with the other Lenders with respect to such excess, either by way of
distribution, pro tanto assignment of claims, subrogation or otherwise as shall
result in each Lender receiving in respect of the Notes held by it or
Reimbursement Obligations owed it, its proportionate payment as contemplated by
this Credit Agreement; provided that if all or any part of such excess payment
is thereafter recovered from such Lender, such disposition and arrangements
shall be rescinded and the amount restored to the extent of such recovery, but
without interest.
17.2. EXPENSES. The Borrower agrees to pay (a) the reasonable costs of
producing and reproducing this Credit Agreement, the other Loan Documents and
the other agreements and instruments mentioned herein, (b) any taxes (including
any interest and penalties in respect thereto) payable by the Administrative
Agent or any of the Lenders (other than taxes based upon the Administrative
Agent's or any Lender's net income) on or with respect to the transactions
contemplated by this Credit Agreement (the Borrower hereby agreeing to indemnify
the Administrative Agent and each Lender with respect thereto), (c) the
reasonable fees, expenses and disbursements of the Administrative Agent's
Special Counsel or any local counsel to the Administrative Agent incurred in
connection with the preparation, syndication, administration or interpretation
of the Loan Documents and other instruments mentioned herein, each closing
hereunder, any amendments, modifications, approvals, consents or waivers hereto
or hereunder, or the cancellation of any Loan Document upon payment in full in
cash of all of the Obligations or pursuant to any terms of such Loan Document
for providing for such cancellation, (d) the fees, expenses and disbursements of
the Administrative Agent or any of its affiliates incurred by the Administrative
Agent or such affiliate in connection with the preparation, syndication,
administration or interpretation of the Loan Documents and other instruments
mentioned herein, including all title insurance premiums and surveyor,
engineering, appraisal and examination charges, (e) any fees, costs, expenses
and bank charges, including bank charges for returned checks, incurred by the
Administrative Agent in establishing, maintaining or handling agency accounts,
lock box accounts and other accounts for the collection of any of the
Collateral, (f) all reasonable out-of-pocket expenses (including without
limitation reasonable attorneys' fees and costs, which attorneys may be
employees of any Lender or the Administrative Agent, and reasonable consulting,
accounting, appraisal, investment bankruptcy and similar professional fees and
charges) incurred by any Lender or the Administrative Agent in connection with
(i) the enforcement of or preservation of rights under any of the Loan Documents
against the Borrower or any of its Subsidiaries or the administration thereof
after the occurrence of a Default or Event of Default and (ii) any litigation,
proceeding or dispute whether arising hereunder or otherwise, in any way related
to any Lender's or the Administrative Agent's relationship with the Borrower or
any of its Subsidiaries and (g) all reasonable fees, expenses and disbursements
of any Lender or the Administrative Agent incurred in connection with UCC
searches, UCC filings, intellectual property searches, intellectual property
filings or mortgage recordings. The covenants contained in this Section 17.2
shall survive payment or satisfaction in full of all other obligations.
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17.3. INDEMNIFICATION. The Borrower agrees to indemnify and hold
harmless the Administrative Agent, the Arranger, their affiliates and the
Lenders from and against any and all claims, actions and suits whether
groundless or otherwise, and from and against any and all liabilities, losses,
damages and expenses of every nature and character arising out of this Credit
Agreement or any of the other Loan Documents or the transactions contemplated
hereby including, without limitation, (a) any actual or proposed use by the
Borrower or any of its Subsidiaries of the proceeds of any of the Loans or
Letters of Credit, (b) the reversal or withdrawal of any provisional credits
granted by the Administrative Agent upon the transfer of funds from lock box,
bank agency, concentration accounts or otherwise under any cash management
arrangements with the Borrower or any Subsidiary or in connection with the
provisional honoring of funds transfers, checks or other items, (c) any actual
or alleged infringement of any patent, copyright, trademark, service xxxx or
similar right of the Borrower or any of its Subsidiaries comprised in the
Collateral, (d) the Borrower or any of its Subsidiaries entering into or
performing this Credit Agreement or any of the other Loan Documents or (e) with
respect to the Borrower and its Subsidiaries and their respective properties and
assets, the violation of any Environmental Law, the presence, disposal, escape,
seepage, leakage, spillage, discharge, emission, release or threatened release
of any Hazardous Substances or any action, suit, proceeding or investigation
brought or threatened with respect to any Hazardous Substances (including, but
not limited to, claims with respect to wrongful death, personal injury or damage
to property), in each case including, without limitation, the reasonable fees
and disbursements of counsel and allocated costs of internal counsel incurred in
connection with any such investigation, litigation or other proceeding; provided
that the Borrower shall not be liable for any portion of such liabilities,
losses, damages and expenses resulting from the gross negligence or willful
misconduct of the Administrative Agent, the Arranger or any affiliate thereof.
In litigation, or the preparation therefor, the Lenders and the Administrative
Agent and its affiliates shall be entitled to select their own counsel and, in
addition to the foregoing indemnity, the Borrower agrees to pay promptly the
reasonable fees and expenses of such counsel. If, and to the extent that the
obligations of the Borrower under this Section 17.3 are unenforceable for any
reason, the Borrower hereby agrees to make the maximum contribution to the
payment in satisfaction of such obligations which is permissible under
applicable law. The covenants contained in this Section 17.3 shall survive
payment or satisfaction in full of all other Obligations.
17.4. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.
17.4.1. CONFIDENTIALITY. Each of the Lenders and the
Administrative Agent agrees, on behalf of itself and each of its
affiliates, directors, officers, employees and representatives, to use
reasonable precautions to keep confidential, in accordance with their
customary procedures for handling confidential information of the same
nature and in accordance with safe and sound banking practices, any
non-public information supplied to it by the Borrower or any of its
Subsidiaries pursuant to this Credit Agreement that is identified by
such Person as being confidential at the time the same is delivered to
the Lenders or the Administrative Agent, provided that nothing herein
shall limit the disclosure of any such information (a) after such
information shall have become public other than through a violation of
this Section 17.4.1, or becomes available to any of the Lenders or the
Administrative Agent on a nonconfidential basis from a source
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other than the Borrower, (b) to the extent required by statute, rule,
regulation or judicial process, (c) to counsel for any of the Lenders or
the Administrative Agent, (d) to bank examiners or any other regulatory
authority having jurisdiction over any Lender or the Administrative
Agent, or to auditors or accountants, (e) to the Administrative Agent,
any Lender or any Financial Affiliate, (f) in connection with any
litigation to which any one or more of the Lenders, the Administrative
Agent or any Financial Affiliate is a party, or in connection with the
enforcement of rights or remedies hereunder or under any other Loan
Document, (g) to a Lender Affiliate or a Subsidiary or affiliate of the
Administrative Agent, (h) to any actual or prospective assignee or
participant or any actual or prospective counterparty (or its advisors)
to any swap or derivative transactions referenced to credit or other
risks or events arising under this Credit Agreement or any other Loan
Document so long as such assignee, participant or counterparty, as the
case may be, agrees in writing to be bound by the provisions of Section
17.4 prior to being given any such confidential information or (i) with
the consent of the Borrower. Moreover, each of the Administrative Agent,
the Lenders and any Financial Affiliate is hereby expressly permitted by
the Borrower to refer to the Borrower and its Subsidiaries in connection
with any advertising, promotion or marketing undertaken by the
Administrative Agent, such Lender or such Financial Affiliate and, for
such purpose, the Administrative Agent, such Lender or such Financial
Affiliate may utilize any trade name, trademark, logo or other
distinctive symbol associated with the Borrower or any of its
Subsidiaries or any of their businesses.
17.4.2. PRIOR NOTIFICATION. Unless specifically prohibited by
applicable law or court order, each of the Lenders and the
Administrative Agent shall, promptly notify the Borrower of any request
for disclosure of any such non-public information by any governmental
agency or representative thereof (other than any such request in
connection with an examination of the financial condition of such Lender
by such governmental agency) or pursuant to legal process prior to
disclosure thereof.
17.4.3. OTHER. In no event shall any Lender or the
Administrative Agent be obligated or required to return any materials
furnished to it or any Financial Affiliate by the Borrower or any of its
Subsidiaries. The obligations of each Lender under this Section 17.4.3
shall supersede and replace the obligations of such Lender under any
confidentiality letter in respect of this financing signed and delivered
by such Lender to the Borrower prior to the date hereof and shall be
binding upon any assignee of, or purchaser of any participation in, any
interest in any of the Loans or Reimbursement Obligations from any
Lender.
17.5. SURVIVAL OF COVENANTS, ETC. All covenants, agreements,
representations and warranties made herein, in the Notes, in any of the other
Loan Documents or in any documents or other papers delivered by or on behalf of
the Borrower or any of its Subsidiaries pursuant hereto shall be deemed to have
been relied upon by the Lenders and the Administrative Agent, notwithstanding
any investigation heretofore or hereafter made by any of them, and shall survive
the making by the Lenders of any of the Loans and the issuance, extension or
renewal of any Letters of Credit, as herein contemplated, and shall continue in
full force and effect so long as any Letter of Credit or any amount due under
this Credit Agreement or the Notes or any of
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the other Loan Documents remains outstanding or any Lender has any obligation to
make any Loans or the Administrative Agent has any obligation to issue, extend
or renew any Letter of Credit, and for such further time as may be otherwise
expressly specified in this Credit Agreement. All statements contained in any
certificate or other paper delivered to any Lender or the Administrative Agent
at any time by or on behalf of the Borrower or any of its Subsidiaries pursuant
hereto or in connection with the transactions contemplated hereby shall
constitute representations and warranties by the Borrower or such Subsidiary
hereunder.
17.6. NOTICES. Except as otherwise expressly provided in this Credit
Agreement, all notices and other communications made or required to be given
pursuant to this Credit Agreement or the Notes or any Letter of Credit
Applications shall be in writing and shall be delivered in hand, mailed by
United States registered or certified first class mail, postage prepaid, sent by
overnight courier, or sent by telegraph, telecopy, facsimile or telex and
confirmed by delivery via courier or postal service, addressed as follows:
(a) if to the Borrower, at 000 Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxxx
Xxxxxx, XX 00000 Attention: Chief Financial Officer or at such other
address for notice as the Borrower shall last have furnished in writing
to the Person giving the notice, with a copy to Bruckmann, Xxxxxx,
Xxxxxxxx & Co., L.L.C., at 000 X. 00xx Xxxxxx, Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx, XX;
(b) if to the Administrative Agent, at 000 Xxxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000, XXX, Attention: Xxxxxx X. Xxxxx, Director,
or such other address for notice as the Administrative Agent shall last
have furnished in writing to the Person giving the notice; and
(c) if to any Lender, at such Lender's address set forth on
Schedule 1 hereto, or such other address for notice as such Lender shall
have last furnished in writing to the Person giving the notice.
Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (i) if delivered by hand, overnight courier or
facsimile to a responsible officer of the party to which it is directed, at the
time of the receipt thereof by such officer or the sending of such facsimile and
(ii) if sent by registered or certified first-class mail, postage prepaid, on
the third Business Day following the mailing thereof.
17.7. GOVERNING LAW. THIS CREDIT AGREEMENT AND, EXCEPT AS OTHERWISE
SPECIFICALLY PROVIDED THEREIN, EACH OF THE OTHER LOAN DOCUMENTS ARE CONTRACTS
UNDER THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL PURPOSES
BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID COMMONWEALTH OF
MASSACHUSETTS (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE
BORROWER AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS CREDIT AGREEMENT OR
ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE COMMONWEALTH
OF MASSACHUSETTS OR ANY FEDERAL COURT SITTING THEREIN AND CONSENTS TO THE
NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT
BEING MADE
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UPON THE BORROWER BY MAIL AT THE ADDRESS SPECIFIED IN SECTION 17.6. THE BORROWER
HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF
ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT
COURT.
17.8. HEADINGS. The captions in this Credit Agreement are for
convenience of reference only and shall not define or limit the provisions
hereof.
17.9. COUNTERPARTS. This Credit Agreement and any amendment hereof may
be executed in several counterparts and by each party on a separate counterpart,
each of which when executed and delivered shall be an original, and all of which
together shall constitute one instrument. In proving this Credit Agreement it
shall not be necessary to produce or account for more than one such counterpart
signed by the party against whom enforcement is sought. Delivery by facsimile by
any of the parties hereto of an executed counterpart hereof or of any amendment
or waiver hereto shall be as effective as an original executed counterpart
hereof or of such amendment or waiver and shall be considered a representation
that an original executed counterpart hereof or such amendment or waiver, as the
case may be, will be delivered.
17.10. ENTIRE AGREEMENT, ETC. The Loan Documents and any other documents
executed in connection herewith or therewith express the entire understanding of
the parties with respect to the transactions contemplated hereby. Neither this
Credit Agreement nor any term hereof may be changed, waived, discharged or
terminated, except as provided in Section 17.12.
17.11. WAIVER OF JURY TRIAL. THE BORROWER HEREBY WAIVES ITS RIGHT TO A
JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN
CONNECTION WITH THIS CREDIT AGREEMENT, THE NOTES OR ANY OF THE OTHER LOAN
DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE PERFORMANCE
OF SUCH RIGHTS AND OBLIGATIONS OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY, INCLUDING ANY
COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR ACTIONS OF THE
ADMINISTRATIVE AGENT OR ANY LENDER RELATING TO THE ADMINISTRATION OF THE LOANS
OR ENFORCEMENT OF THE LOAN DOCUMENTS AND AGREES THAT IT WILL NOT SEEK TO
CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT
BE OR HAS NOT BEEN WAIVED. Except as prohibited by law, the Borrower hereby
waives any right it may have to claim or recover in any litigation referred to
in the preceding sentence any special, exemplary, punitive or consequential
damages or any damages other than, or in addition to, actual damages. The
Borrower (a) certifies that no representative, agent or attorney of any Lender
or the Administrative Agent has represented, expressly or otherwise, that such
Lender or the Administrative Agent would not, in the event of litigation, seek
to enforce the foregoing waivers and (b) acknowledges that the Administrative
Agent and the Lenders have been induced to enter into this Credit Agreement, the
other Loan Documents to which it is a party by, among other things, the waivers
and certifications contained herein.
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17.12. CONSENTS, AMENDMENTS, WAIVERS, ETC. Any consent or approval
required or permitted by this Credit Agreement to be given by the Lenders may be
given, and any term of this Credit Agreement, the other Loan Documents or any
other instrument related hereto or mentioned herein may be amended, and the
performance or observance by the Borrower or any of its Subsidiaries of any
terms of this Credit Agreement, the other Loan Documents or such other
instrument or the continuance of any Default or Event of Default may be waived
(either generally or in a particular instance and either retroactively or
prospectively) with, but only with, the written consent of the Borrower and the
written consent of the Required Lenders. Notwithstanding the foregoing, no
amendment, modification or waiver shall:
(a) without the written consent of the Borrower and each Lender
directly affected thereby:
(i) reduce or forgive the principal amount of any Loans
or Reimbursement Obligations, or reduce the rate of interest on
the Notes or the amount of the Commitment Fee or Letter of
Credit Fees (other than interest accruing pursuant to Section
6.11.2 following the effective date of any waiver by the
Required Lenders of the Default or Event of Default relating
thereto;
(ii) increase the amount of such Lender's Commitment or
extend the expiration date of such Lender's Commitment;
(iii) postpone or extend the Revolving Credit Loan
Maturity Date or the Term Loan Maturity Date or any other
regularly scheduled dates for payments of principal of, or
interest on, the Loans or Reimbursement Obligations or any Fees
or other amounts payable to such Lender (it being understood
that (A) a waiver of the application of the default rate of
interest pursuant to Section 6.11.2, and (B) any vote to rescind
any acceleration made pursuant to Section 14.1 of amounts owing
with respect to the Loans and other Obligations shall require
only the approval of the Required Lenders); and
(iv) other than pursuant to a transaction permitted by
the terms of this Credit Agreement, release all or any portion
of the Collateral with a book value greater than or equal to
fifty percent (50%) of the aggregate book value of the
Collateral prior to such release (excluding, if the Borrower or
any Subsidiary becomes a debtor under the federal Bankruptcy
Code, the release of "cash collateral", as defined in Section
363(a) of the federal Bankruptcy Code pursuant to a cash
collateral stipulation with the debtor approved by the Required
Lenders);
(b) without the written consent of all of the Lenders, amend or
waive this Section 17.12 or the definition of Required Lenders;
(c) without the written consent of the Administrative Agent,
amend or waive Section 15, the amount or time of payment of the
Administrative Agent's Fee or any Letter of Credit Fees payable for the
Administrative Agent's account or any other provision applicable to the
Administrative Agent.
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No waiver shall extend to or affect any obligation not expressly waived or
impair any right consequent thereon. No course of dealing or delay or omission
on the part of the Administrative Agent or any Lender in exercising any right
shall operate as a waiver thereof or otherwise be prejudicial thereto. No notice
to or demand upon the Borrower shall entitle the Borrower to other or further
notice or demand in similar or other circumstances.
17.13. SEVERABILITY. The provisions of this Credit Agreement are
severable and if any one clause or provision hereof shall be held invalid or
unenforceable in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect only such clause or provision, or part thereof, in
such jurisdiction, and shall not in any manner affect such clause or provision
in any other jurisdiction, or any other clause or provision of this Credit
Agreement in any jurisdiction.
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IN WITNESS WHEREOF, the undersigned have duly executed this Credit
Agreement as a sealed instrument as of the date first set forth above.
IL FORNAIO (AMERICA) CORPORATION
By: /s/ XXXX X. XXXXXX
-------------------------------------
Name: Xxxx X. Xxxxxx
Title: Chief Financial Officer
FLEET NATIONAL BANK, individually and as
Administrative Agent
By: /s/ XXXXXX X. XXXXX
-------------------------------------
Xxxxxx X. Xxxxx, Director
IBJ WHITEHALL BANK & TRUST COMPANY,
individually and as Syndication Agent
By: /s/ XXXXX X. XXXXX
-------------------------------------
Name: Xxxxx X. Xxxxx
Title: Managing Director
