EXHIBIT 4.1
EXECUTION COPY
$156,500,000
FOURTH
AMENDED AND RESTATED
CREDIT AGREEMENT
Dated as of May 2, 2001
among
ABC-NACO INC.,
ABC-NACO LATINO AMERICA, S.A. de C.V.,
DOMINION CASTINGS LIMITED,
BANK OF AMERICA CANADA,
as Canadian Revolving Lender,
BANK OF AMERICA, N.A.,
as Agent and Letter of Credit Issuing Lender
and
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
Table of Contents
Page No.
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ARTICLE I
DEFINITIONS; RESTATEMENT; WAIVER 2
1.01 Certain Defined Terms 2
1.02 Other Interpretive Provisions. 25
1.03 Accounting Principles. 26
1.04 Currency Equivalents Generally 27
1.05 Restatement and Amendment; Effect 27
1.06 Waiver of Existing Defaults 27
ARTICLE II
THE CREDITS 28
2.01 Amounts and Terms of Commitments 28
2.02 Loan Accounts; Notes. 28
2.03 Procedure for Borrowing by the Company or the Mexican Borrower. 29
2.04 The Swing Line Loans. 30
2.05 Canadian Revolving Loans. 32
2.06 Voluntary Termination or Reduction of Available Commitments 33
2.07 Prepayments. 34
2.08 Repayments and Scheduled Commitment Reductions. 37
2.09 Interest. 37
2.10 Fees 38
2.11 Computation of Fees and Interest. 39
2.12 Payments by the Borrowers. 39
2.13 Payments by the Lenders to the Agent. 40
2.14 Sharing of Payments, Etc 40
ARTICLE III
THE LETTERS OF CREDIT 41
3.01 The Letter of Credit Subfacility. 41
3.02 Issuance, Amendment and Renewal of Letters of Credit. 42
3.03 Risk Participations, Drawings and Reimbursements. 44
3.04 Repayment of Participations. 45
3.05 Role of the Issuing Lender. 46
3.06 Obligations Absolute 47
3.07 Cash Collateral Pledge 48
3.08 Letter of Credit Fees. 48
3.09 Uniform Customs and Practice 49
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY 49
4.01 Taxes. 49
4.02 Increased Costs and Reduction of Return. 50
4.03 Certificates of Lenders 51
4.04 Survival 51
ARTICLE V
CONDITIONS PRECEDENT 51
5.01 Conditions of Initial Credit Extensions 51
5.02 Conditions to All Credit Extensions 55
ARTICLE VI
REPRESENTATIONS AND WARRANTIES 56
6.01 Corporate Existence and Power 56
6.02 Corporate Authorization; No Contravention 56
6.03 Governmental Authorization 56
6.04 Binding Effect 56
6.05 Litigation 57
6.06 No Default 57
6.07 ERISA Compliance. 57
6.08 Use of Proceeds; Margin Regulations 58
6.09 Title to Properties 58
6.10 Taxes 58
6.11 Financial Condition. 58
6.12 Environmental Matters 59
6.13 Collateral Documents. 60
6.14 Regulated Entities 60
6.15 No Burdensome Restrictions 60
6.16 Solvency 60
6.17 Labor Relations 61
6.18 Copyrights, Patents, Trademarks and Licenses, etc 61
6.19 Subsidiaries 61
6.20 Insurance 61
6.21 Swap Obligations 61
6.22 Subordination Provisions 61
6.23 Broker's Fees 61
6.24 Restructuring Documents 62
6.25 Full Disclosure 62
ARTICLE VII
AFFIRMATIVE COVENANTS 62
7.01 Financial Statements 62
7.02 Certificates; Other Information 63
7.03 Notices 64
7.04 Preservation of Corporate Existence, Etc 65
7.05 Maintenance of Property 66
7.06 Insurance 66
7.07 Payment of Obligations 67
7.08 Compliance with Laws 67
7.09 Compliance with ERISA 67
7.10 Inspection of Property and Books and Records 67
7.11 Environmental Laws. 68
7.12 Use of Proceeds 68
7.13 Solvency 68
7.14 Further Assurances. 68
7.15 Foreign Subsidiaries Security 69
7.16 Bancomer Financing 69
7.17 Consultants 69
7.18 SubDebt Consent Solicitation 69
ARTICLE VIII
NEGATIVE COVENANTS 70
8.01 Limitation on Liens 70
8.02 Disposition of Assets 72
8.03 Consolidations and Mergers 72
8.04 Loans and Investments 73
8.05 Limitation on Indebtedness 73
8.06 Transactions with Affiliates 74
8.07 Use of Proceeds 74
8.08 Contingent Obligations 75
8.09 Restricted Payments. 75
8.10 ERISA 76
8.11 Change in Business 76
8.12 Accounting Changes 76
8.13 EBITDA 76
8.14 Irregular Items 77
8.15 Collateral Coverage Ratio 78
8.16 Capital Expenditures 78
8.17 Subordinated Debt 78
8.18 Material Agreements 79
ARTICLE IX
EVENTS OF DEFAULT 79
9.01 Event of Default 79
9.02 Remedies 82
9.03 Rights Not Exclusive 83
ARTICLE X
THE AGENT 83
10.01 Appointment and Authorization; "Agent". 83
10.02 Delegation of Duties 84
10.03 Liability of Agent 84
10.04 Reliance by Agent. 84
10.05 Notice of Default 85
10.06 Credit Decision 85
10.07 Indemnification of Agent 85
10.08 Agent in Individual Capacity 86
10.09 Successor Agent 86
10.10 Withholding Tax 86
10.11 Collateral Matters 88
ARTICLE XI
MISCELLANEOUS 88
11.01 Amendments and Waivers 88
11.02 Notices. 90
11.03 No Waiver; Cumulative Remedies 90
11.04 Costs and Expenses 90
11.05 Company Indemnification 91
11.06 Payments Set Aside 92
11.07 Successors and Assigns 92
11.08 Assignments, Participations, etc. 92
11.09 Confidentiality 93
11.10 Set-off 94
11.11 Automatic Debits of Fees 94
11.12 Notification of Addresses, Lending Offices, Etc 95
11.13 Counterparts 95
11.14 Severability 95
11.15 No Third Parties Benefited 95
11.16 Governing Law and Jurisdiction. 95
11.17 Waiver of Jury Trial 96
11.18 Judgment 96
11.19 Entire Agreement 96
11.20 Effectiveness 96
11.21 Release 97
ARTICLE XII
COMPANY GUARANTY 97
12.01 The Guaranty 97
12.02 Insolvency 98
12.03 Nature of Liability 98
12.04 Independent Obligation 98
12.05 Authorization 98
12.06 Reliance 99
12.07 Subordination 99
12.08 Waiver. 100
12.09 Nature of Liability 100
SCHEDULES
Schedule 1.01-A Bancomer Financing Proposal
Schedule 1.01-B Existing Swap Contracts
Schedule 2.01 Commitments
Schedule 2.05 Procedure for Canadian Revolving Loan Borrowings
Schedule 2.07(e) Signal Division Proceeds Allocation
Schedule 6.05 Litigation
Schedule 6.06 Existing Defaults
Schedule 6.11(a) Permitted Liabilities
Schedule 6.11(b) Projections
Schedule 6.12 Environmental Liabilities
Schedule 6.19 Subsidiaries and Minority Interests
Schedule 8.01 Existing Liens
Schedule 8.04 Existing Investments
Schedule 8.05 Existing Indebtedness
Schedule 8.08 Contingent Obligations
Schedule 11.02 Lending Offices; Addresses for Notices
EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Compliance Certificate
Exhibit C Form of Legal Opinion of Company's Counsel
Exhibit D List of Closing Documents
Exhibit E Form of Supplemental Indenture
Exhibit F Form of Assignment and Acceptance
Exhibit G-1 Form of Company Revolving Loan Promissory Note
Exhibit G-2 Form of Mexican Borrower Revolving Loan Promissory Note
Exhibit G-3 Form of Canadian Borrower Revolving Loan Promissory Note
Exhibit G-4 Form of Swing Line Note
45
CH1 2142991v5
FOURTH AMENDED AND RESTATED CREDIT AGREEMENT
This FOURTH AMENDED AND RESTATED CREDIT AGREEMENT is entered into as of May
2, 2001 among ABC-NACO Inc., a Delaware corporation (the "Company"), ABC-NACO
Latino America, S.A. de C.V. (formerly known as ABC-NACO de Mexico, S.A. de
C.V.), a Mexican corporation ("Mexican Borrower"), Dominion Castings Limited, an
Ontario corporation ("Canadian Borrower"), the several financial institutions
from time to time party to this Agreement, Bank of America Canada, as Canadian
Revolving Lender (the "Canadian Revolving Lender"), (collectively, the
"Lenders"; individually, a "Lender"), and Bank of America, N.A. (as successor to
Bank of America National Trust and Savings Association), as letter of credit
issuing lender and as agent for the Lenders (in such capacity, the "Agent").
WHEREAS, the Borrowers, the Lenders and the Agent are parties to that certain
Third Amended and Restated Credit Agreement dated as of October 30, 2000 (the
"Existing Credit Agreement"), pursuant to which, subject to the terms and
conditions thereof, the Lenders have provided loans and certain other financial
accommodations to the Borrowers;
WHEREAS, as of the date hereof, the Borrowers have failed to comply with certain
of their financial and other covenants and obligations under the Existing Credit
Agreement and the other existing Loan Documents, as described in Schedule 6.06
(as so described therein, the "Existing Defaults"), and have informed the
Lenders that they will likely not be able to comply hereafter with certain
payment and performance obligations of the Existing Credit Agreement and other
Loan Documents;
WHEREAS, the Company has entered into that certain Credit Agreement dated as of
May 2, 2001 among ING Xxxxxx Xxxx Investors III LP, individually and as agent
and certain other lenders (collectively, the "ING Funds") and the Company (as
amended and modified from time to time in accordance with this Agreement, the
"ING Loan Agreement"), pursuant to which the ING Funds would make a term loan to
the Company in an aggregate original principal amount of $15,000,000 (the "ING
Loan"), the Domestic Subsidiaries which are Wholly-Owned Subsidiaries would
guaranty all of the Company's obligations under the ING Loan Agreement, and the
Company and such Subsidiaries would grant liens and security interests to the
ING Funds, which are junior in priority to those granted to the Collateral Agent
pursuant to the Collateral Documents, in substantially all of the Company's and
such Subsidiaries' domestic real and personal property;
WHEREAS, the Company has entered into that certain Series C Preferred Stock and
Common Stock Warrant Purchase Agreement dated as of April 17, 2001 between the
Company and the ING Funds (as amended and modified from time to time in
accordance with this Agreement, the "Series C Preferred Agreement"), pursuant to
which, subject to the satisfaction of certain conditions specified therein which
are expected to be satisfied after the date hereof, the Company would issue and
sell, and the ING Funds would purchase, certain shares of the Company's Series C
Convertible Preferred Stock and certain warrants to purchase the Company's
Common Stock, and the aggregate outstanding principal balance of the ING Loan
would be repaid in full from the proceeds of such purchase;
WHEREAS, the Company has entered into that certain Asset Sale Agreement dated as
of April 17, 2001 among Metal Matrix LLC, a Delaware limited liability company
(the "Flow Purchaser"), the Company and certain of its Subsidiaries (as amended
and modified from time to time in accordance with this Agreement, the "Flow Sale
Agreement"), pursuant to which the Company and such Subsidiaries would sell, and
the Flow Purchaser would purchase, certain assets consisting of the Company's
Locomotive, Flow and Specialty Products Group, xxxxxxxxxxxxxxxx.xxx, the
Baltimore Brake Shoe facility and the Melrose Park mine and mill operations (as
more particularly described in such Flow Sale Agreement, collectively, the "Flow
Assets") and assume certain liabilities related thereto;
WHEREAS, the Borrowers have requested that the Agent and the Lenders agree, and
subject to the terms and conditions of this Agreement the Agent and the Lenders
have agreed, to (a) waive each of the Existing Defaults, and to (b) amend and
restate the Existing Credit Agreement so as to, among other things, (i) modify
the payment obligations and financial covenants of the Existing Credit Agreement
in a manner consistent with the Borrowers' revised financial projections and
business plan, and (ii) permit the consummation of the transactions contemplated
by ING Loan Agreement, the Series C Preferred Agreement and the Flow Sale
Agreement, among other things, to provide the Company and its Subsidiaries with
sufficient capital to effect such revised business plan substantially in
accordance with such financial projections; and
WHEREAS, on the Closing Date hereof and concurrently with the amendment and
restatement of the Existing Credit Agreement pursuant to this Agreement and the
consummation of the transactions contemplated by the ING Loan Agreement and Flow
Sale Agreement, the Available Commitment shall be reduced from $172,047,000 to
$156,500,000 and the Company shall prepay the outstanding principal balance of
all Loans by an amount equal to $15,500,000.
NOW, THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained herein, the parties agree as follows:
ARTICLE I
DEFINITIONS; RESTATEMENT; WAIVER
1.01 Certain Defined Terms. The following terms have the following
meanings:
"Acquisition" means any transaction or series of related transactions for
the purpose of or resulting, directly or indirectly, in (a) the acquisition of
all or substantially all of the assets of a Person, or of any business or
division of a Person, (b) the acquisition of in excess of 50% of the capital
stock, partnership interests, membership interests or equity of any Person, or
otherwise causing any Person to become a Subsidiary, or (c) a merger or
consolidation or any other combination with another Person (other than a Person
that is a Subsidiary) provided that the Company or the Subsidiary is the
surviving entity.
"Adjusted Net Earnings from Operations" means, with respect to any fiscal period
of the Company, the net income of such Company and its Subsidiaries on a
consolidated basis after provision for income taxes for such fiscal period, as
determined in accordance with GAAP and reported on its financial statements for
such fiscal period, less any and all of the following included in such net
income: (a) gain or loss arising from the sale of any capital asset; (b) gain
arising from any write-up in the book value of any asset; (c) earnings of any
business entity, substantially all the assets of which have been acquired in any
manner, or which has merged or otherwise consolidated with and into the Company
or any Subsidiary to the extent realized by such other business entity prior to
the date of such acquisition, merger or consolidation; (d) earnings of any
business entity (other than a Subsidiary) in which the Company or any Subsidiary
has an ownership interest unless (and only to the extent) such earnings shall
actually have been received by the Company or such Subsidiary in the form of
cash distributions; (e) earnings of any Person to which assets of the Company or
any Subsidiary shall have been sold, transferred or disposed of, or into which
the Company or any Subsidiary shall have been merged, or which has been a party
with the Company or any Subsidiary to any consolidation or other form of
reorganization in which the Company or such Subsidiary is not the surviving
entity, after the date of such transaction; (f) gain arising from the
acquisition of debt or equity securities of the Company or any Subsidiary or
from cancellation or forgiveness of Indebtedness; and (g) gain arising from
extraordinary items including restructuring charges, as determined in accordance
with GAAP, or from any other non-recurring transaction.
"Affiliate" means, as to any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control with,
such Person. A Person shall be deemed to control another Person if the
controlling Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of the other Person, whether
through the ownership of voting securities, membership interests, by contract,
or otherwise.
"Agent" means B of A in its capacity as agent for the Lenders hereunder, and any
successor agent arising under Section 10.09.
"Agent-Related Persons" means B of A and any successor agent arising under
Section 10.09 and any successor letter of credit issuing lender hereunder,
together with their respective Affiliates, and the officers, directors,
employees, agents and attorneys-in-fact of such Persons and Affiliates.
"Agent's Payment Office" means the address for payments set forth on Schedule
11.02 or such other address as the Agent may from time to time specify.
"Agreement" means this Credit Agreement, as the same may at any time be amended,
supplemented or otherwise modified in accordance with the terms hereof and in
effect.
"Applicable Margin" shall mean, at all times, a per annum rate equal to 2.75%.
"Assignee" has the meaning specified in Section 11.08(a).
"Attorney Costs" means and includes all reasonable and customary fees and
disbursements of any law firm or other external counsel, the allocated cost of
internal legal services and all disbursements of internal counsel.
"Available Commitment" as to any Lender, means such Lender's Commitment and as
to all Lenders, means the aggregate of such Lenders' Commitment, in each case as
the same may be reduced from time to time pursuant to this Agreement.
"B of A" means Bank of America, N.A. (as successor to Bank of America National
Trust and Savings Association), a national banking association.
"Bancomer Financing" the proposed financing to be provided to the Mexican
Borrower by Bancomer, S.A. substantially on the terms and conditions described
in Schedule 1.01-A and, in any event, approved in writing by the Majority
Lenders.
"Bancomer Prepayment Amount" means, as of any date of the closing and funding
the Bancomer Financing, an amount equal to the greater of:
(a) $7,500,000; and
(b) the product of (i) $7,500,000 multiplied by (ii) a fraction:
(A) the numerator of which shall equal the sum of (1) $11,500,000 plus
(2) the positive amount, if any, by which the aggregate intercompany receivable
owing from the Mexican Subsidiaries to the Company and the Domestic Subsidiaries
exceeds $7,500,000 as of such date plus (3) the positive amount, if any, by
which the aggregate gross amount of accounts receivable which arose from the
sale of inventory produced or assembled by facilities owned or leased by the
Mexican Subsidiaries exceeds $4,000,000 as of such date; and
(B) the denominator of which shall equal $11,500,000.
"Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978 (11
U.S.C. Sec.101, et seq.).
"Base Rate" means, with respect to an obligation denominated in Dollars for any
day, the higher of: (a) 0.50% per annum above the latest Federal Funds Rate;
and (b) the rate of interest in effect for such day as publicly announced from
time to time by B of A in Charlotte, North Carolina as its "reference rate".
The "reference rate" is a rate set by B of A or the Canadian Revolving Lender,
as the case may be, based upon various factors including its costs and desired
return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above, or below
such announced rate. Any change in the reference rate announced by B of A or
the Canadian Revolving Lender, as the case may be, shall take effect at the
opening of business on the day specified in the public announcement of such
change.
"Base Rate Loan" means a Loan or an L/C Advance, that bears interest based on
the Base Rate plus the Applicable Margin.
"Borrower" means any of the Company, Mexican Borrower or Canadian Borrower.
"Borrowing" means a borrowing hereunder consisting of Loans made to the same
Borrower on the same day by the Revolving Lenders under Article II. The making
of a Swing Line Loan or Canadian Revolving Loan shall not constitute a
Borrowing.
"Borrowing Date" means any date on which a Borrowing occurs under Section 2.03.
"Business Day" means any day other than a Saturday, Sunday or other day on which
commercial banks in Chicago, Illinois or Charlotte, North Carolina are
authorized or required by law to close and, with respect to any disbursements
and payments in and calculations pertaining to any Canadian Revolving Loan, any
day other than a Saturday, Sunday or other day on which commercial banks in
Toronto, Canada and New York, New York are authorized or required by law to
close.
"Canadian Borrower" means Dominion Castings Limited, an Ontario corporation.
"Canadian Dollars" or "cdn" means the lawful currency of Canada.
"Canadian Revolving Lender" means Bank of America Canada, in its capacity as
provider of the Canadian Revolving Loans.
"Canadian Revolving Loans" has the meaning specified in Section 2.05(a).
"Canadian Subsidiary Loan Sublimit" means $5,000,000.
"Capital Adequacy Regulation" means any guideline, request or directive of any
central bank or other Governmental Authority, or any other law, rule or
regulation, whether or not having the force of law, in each case, regarding
capital adequacy of any bank or of any corporation controlling a bank.
"Capital Expenditures" means, for any period and with respect to any Person, the
aggregate of all expenditures by such Person and its Subsidiaries for the
acquisition or leasing of fixed or capital assets or additions to equipment
(including replacements, capitalized repairs and improvements during such
period) which should be capitalized under GAAP on a consolidated balance sheet
of such Person and its Subsidiaries.
"Capital Lease" has the meaning specified in the definition of "Capital Lease
Obligations."
"Capital Lease Obligations" means all monetary obligations of the Company or any
of its Subsidiaries under any leasing or similar arrangement which, in
accordance with GAAP, is classified as a capital lease ("Capital Lease").
"Cash Collateralize" means to pledge and deposit with or deliver to the Agent,
for the benefit of the Agent, the Issuing Lender and the Lenders, as additional
collateral for the L/C Obligations, cash or deposit account balances pursuant to
documentation in form and substance satisfactory to the Agent and the Issuing
Lender (which documents are hereby consented to by the Lenders). Derivatives of
such term shall have corresponding meaning. The Company hereby grants the
Agent, for the benefit of the Agent, the Issuing Lender and the Lenders, a
security interest in all such cash and deposit account balances. Cash
collateral shall be maintained in blocked deposit accounts at B of A. The Agent
shall invest any and all available funds deposited in such deposit accounts,
within 10 business days after the date the relevant funds become available, in
securities issued or fully guaranteed or insured by the United States Government
or any agency thereof backed by the full faith and credit of the United States
having maturities of three months from the date of acquisition thereof
(collectively, "Governmental Obligations"). The Company hereby acknowledges and
agrees that the Agent shall not have any liability with respect to, and the
Company hereby indemnifies the Agent against, any loss resulting from the
acquisition of the Government Obligations and the Agent shall not have any
obligation to monitor the trading activity of any such Governmental Obligations
on and after the acquisition thereof for the purpose of obtaining the highest
possible return with respect thereto, the Agent's responsibility being limited
to acquiring such Governmental Obligations.
"Cash Equivalents" means:
(a) securities issued or fully guaranteed or insured by the United
States Government or any agency thereof and backed by the full faith and credit
of the United States having maturities of not more than six months from the date
of acquisition;
(b) certificates of deposit, time deposits, Eurodollar time deposits,
repurchase agreements, reverse repurchase agreements, or bankers' acceptances,
having in each case a term of not more than six months, issued by any Lender, or
by any U.S. commercial bank having combined capital and surplus of not less than
$100,000,000 whose short term securities are rated at least A-1 by S&P and P-1
by Xxxxx'x; and
(c) commercial paper of an issuer rated at least A-1 by S&P or P-1 by
Xxxxx'x and in either case having a tenor of not more than three months.
"Change of Control" means (a) any Person or any two or more Persons acting
in concert (in any such case, excluding the ING Funds) acquiring beneficial
ownership (within the meaning of Rule 13d-3 of the Securities and Exchange
Commission under the Exchange Act), directly or indirectly, of capital stock of
the Company (or other securities convertible into such capital stock)
representing 40% or more of the combined voting power of all capital stock of
the Company entitled to vote in the election of directors, other than capital
stock having such power only by reason of the happening of a contingency, or (b)
during any period of twelve consecutive calendar months, individuals who at the
beginning of such period constituted the Company's board of directors (together
with any new directors whose election by the Company's board of directors or
whose nomination for election by the Company's stockholders was approved by a
vote of at least a majority of the directors then still in office who either
were directors at the beginning of such period or whose election or nomination
for election was previously so approved) cease for any reasons other than death
or disability to constitute a majority of the directors then in office.
"Closing Date" means the date on which all conditions precedent set forth in
Section 5.01 are satisfied or waived by all Lenders.
"Code" means the Internal Revenue Code of 1986, as amended, and regulations
promulgated thereunder.
"Collateral" means all property and interests in property and proceeds thereof
now owned or hereafter acquired by any Credit Party in or upon which a Lien now
or hereafter exists in favor of the Lenders, or the Collateral Agent on behalf
of the Lenders, whether under this Agreement or under any other documents
executed by any such Persons and delivered to the Collateral Agent.
"Collateral Agent" means the Agent acting in its capacity as Collateral Agent
pursuant to the Collateral Documents.
"Collateral Coverage Ratio" means, as of any date of determination for the
Company and its Subsidiaries on a consolidated basis, the ratio of (i) the sum
of (A) the net book value of accounts receivable determined in accordance with
GAAP as of such date, plus (B) the book value of inventory determined in
accordance with GAAP as of such date, plus (C) $72,173,000, minus (D) the
aggregate appraised orderly liquidation value, as of the Closing Date, and as
set forth in (or reasonably extrapolated from, by the Agent in its reasonable
determination) the appraisals most recently delivered to the Agent prior to the
Closing Date, of machinery, equipment and real property sold or otherwise
disposed of by the Company and its Subsidiaries after the Closing Date and prior
to such date of determination (other than with respect to the Signal Division,
the Company's Melrose Park facility and the asset subject to the Flow Sale), to
(ii) the Available Commitment in effect as of such date.
"Collateral Documents" means, collectively, (a) the Security Agreements, the
Guaranty of the Company pursuant to Article XII, each Subsidiary Guaranty, the
Pledge Agreements, the Intellectual Property Assignments, the Mortgages and all
other security agreements, patent and trademark assignments, guarantees and
other similar agreements between the Company or its Subsidiaries and the Lenders
or the Collateral Agent for the benefit of the Guaranteed Creditors, now or
hereafter delivered to the Lenders or the Collateral Agent pursuant to or in
connection with the transactions contemplated hereby, and all financing
statements (or comparable documents now or hereafter filed in accordance with
the UCC or comparable law) against the Company or any Subsidiaries or any
Guarantor as debtor in favor of the Lenders or the Collateral Agent for the
benefit of the Guaranteed Creditors as secured party and (b) any amendments,
supplements, modifications, renewals, replacements, consolidations,
substitutions and extensions of any of the foregoing.
"Commitment" has the meaning specified in Section 2.01.
"Commitment Fee" has the meaning specified in Section 2.10(c).
"Company" means ABC-NACO Inc., a Delaware corporation.
"Compliance Certificate" means a certificate substantially in the form of
Exhibit B.
"Computation Date" has the meaning specified in Section 2.07(d).
"Consolidated Interest Expense" means, for any period, gross consolidated
interest expense for the period (including all commissions, discounts, fees and
other charges in connection with standby letters of credit and similar
instruments) for the Company and its Subsidiaries, plus the portion of the
up-front costs and expenses for Swap Contracts (to the extent not included in
gross interest expense) fairly allocated to such Swap Contracts as expenses for
such period, as determined in accordance with GAAP and after giving effect to
any Swap Contract then in effect.
"Contingent Obligation" means, as to any Person, any direct or indirect
liability of that Person, whether or not contingent, with or without recourse,
(a) with respect to any Indebtedness, lease, dividend, letter of credit or other
obligation (the "primary obligations") of another Person (the "primary
obligor"), including any obligation of that Person (i) to purchase, repurchase
or otherwise acquire such primary obligations or any security therefor, (ii) to
advance or provide funds for the payment or discharge of any such primary
obligation, or to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency or any balance sheet
item, level of income or financial condition of the primary obligor, (iii) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation, or (iv) otherwise to assure or hold
harmless the holder of any such primary obligation against loss in respect
thereof (each, a "Guaranty Obligation"); (b) with respect to any Surety
Instrument (other than any Letter of Credit) issued for the account of that
Person or as to which that Person is otherwise liable for reimbursement of
drawings or payments; (c) to purchase any materials, supplies or other property
from, or to obtain the services of, another Person if the relevant contract or
other related document or obligation requires that payment for such materials,
supplies or other property, or for such services, shall be made regardless of
whether delivery of such materials, supplies or other property is ever made or
tendered, or such services are ever performed or tendered; or (d) in respect of
any Swap Contract. The amount of any Contingent Obligation shall, in the case
of Guaranty Obligations, be deemed equal to the stated or determinable amount of
the primary obligation in respect of which such Guaranty Obligation is made or,
if not stated or if indeterminable, the maximum reasonably anticipated liability
in respect thereof, and in the case of other Contingent Obligations other than
in respect of Swap Contracts, shall be equal to the maximum reasonably
anticipated liability in respect thereof and, in the case of Contingent
Obligations in respect of Swap Contracts, shall be equal to the Swap Termination
Value.
"Contractual Obligation" means, as to any Person, any provision of any security
issued by such Person or of any agreement, undertaking, contract, indenture,
mortgage, deed of trust or other instrument, document or agreement to which such
Person is a party or by which it or any of its property is bound.
"Credit Extension" means and includes (a) the making of any Loans hereunder, and
(b) the Issuance of any Letter of Credit hereunder.
"Credit Party" means each Borrower and each Subsidiary that is a party to a
Subsidiary Guaranty.
"Default" means any event or circumstance which, with the giving of notice, the
lapse of time, or both, would (if not cured or otherwise remedied during such
time) constitute an Event of Default.
"Dollar Equivalent" means, at any time, (a) as to any amount denominated in
Dollars, the amount thereof at such time, and (b) as to any amount denominated
in Canadian Dollars, the equivalent amount in Dollars as determined by the
Administrative Agent at such time on the basis of the Spot Rate for the purchase
of Dollars with Canadian Dollars on the most recent Computation Date provided
for in Section 2.07(d).
"Dollar Refunding Amount" has the meaning specified in Section 2.05(b)(i).
"Dollars", "dollars" and "$" each mean lawful money of the United States.
"Domestic Subsidiary" means each Subsidiary of the Company that is organized
under the laws of the United States or any state thereof.
"EBITDA" means, for any period, the Company's and its Subsidiaries' Net Income
on a consolidated basis, determined in accordance with GAAP; plus, to the extent
deducted in the computation of Net Income for such period, (a) Consolidated
Interest Expense, (b) income or franchise taxes paid or accrued and (c)
amortization and depreciation expense; provided, however, that Net Income shall
be computed for these purposes without giving effect to any non-cash,
non-recurring extraordinary losses or special charges incurred during such
period as a result of the impairment of long-term assets with respect to the
Company's and its Subsidiaries' Calera, Permatrack, Cicero or Deco operations.
"Effective Amount" means (a) with respect to any Loans on any date, the
aggregate outstanding principal Dollar Equivalent amount thereof after giving
effect to any Borrowings and prepayments or repayments of Loans occurring on
such date; and (b) with respect to any outstanding LC Obligations on any date,
the Dollar Equivalent amount of such LC Obligations on such date after giving
effect to any Issuances of Letters of Credit occurring on such date and any
other changes in the aggregate amount of the LC Obligations as of such date,
including as a result of any reimbursements of outstanding unpaid drawings under
any Letters of Credit or any reductions in the maximum amount available for
drawing under Letters of Credit taking effect on such date.
"Eligible Assignee" means (a) a commercial bank organized under the laws of the
United States, or any state thereof, and having a combined capital and surplus
of at least $100,000,000; (b) 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 a combined capital and surplus of at least $100,000,000, provided that
such bank is acting through a branch or agency located in the United States; (c)
a Person that is primarily engaged in the business of commercial banking and
that is (i) a Subsidiary of a Lender, (ii) a Subsidiary of a Person of which a
Lender is a Subsidiary, or (iii) a Person of which a Lender is a Subsidiary; (d)
an "accredited investor", as such term is defined in Rule 501(a) of Regulation D
under the Securities Act of 1933, as amended (other than the Company or an
Affiliate of the Company); (e) a finance company, insurance company or other
financial institution or fund (whether a corporation, partnership, trust or
other entity) that is primarily engaged in the business of making, purchasing or
otherwise investing in commercial loans; and (f) any other entity approved by
the Agent (which approval shall not be unreasonably withheld).
"Environmental Claims" means all claims, however asserted, by any Governmental
Authority or other Person alleging potential liability or responsibility for
violation of any Environmental Law, or for release or injury to the environment
or threat to public health, personal injury (including sickness, disease or
death), property damage, natural resources damage, or otherwise alleging
liability or responsibility for damages (punitive or otherwise), investigation,
cleanup, removal, remedial or response costs, restitution, civil or criminal
penalties, injunctive relief, or other type of relief, resulting from or based
upon the presence, placements, discharge, emission or release (including
intentional and unintentional, negligent and non-negligent, sudden or
non-sudden, accidental or non-accidental, placements, spills, leaks, discharges,
emissions or releases) of any Hazardous Material at, in, or from any property,
whether or not owned by the Company or any Subsidiary or taken as collateral, or
in connection with any operations of the Company.
"Environmental Laws" means all federal, state or local laws, statutes, common
law duties, rules, regulations, ordinances and codes, together with all
administrative orders, directed duties, requests, licenses, authorizations and
permits of, and agreements with, any Governmental Authorities, in each case
relating to environmental, health, safety and land use matters, including
without limitation, the Comprehensive Environmental Response, Compensation and
Liability Act of 1980 ("CERCLA"), the Clean Air Act, the Federal Water Pollution
Control Act of 1972, the Solid Waste Disposal Act, the Federal Resource
Conservation and Recovery Act, the Toxic Substances Control Act, the Emergency
Planning and Community Right-to-Know Act and the Ley General del Equilibrio
Ecologico y la Proteccion al Ambiente.
"Environmental Permits" has the meaning specified in Section 6.12(b).
"ERISA" means the Employee Retirement Income Security Act of 1974, and
regulations promulgated thereunder.
"ERISA Affiliate" means any trade or business (whether or not incorporated)
under common control with the Company within the meaning of Section 414(b) or
(c) of the Code (and Sections 414(m) and (o) of the Code for purposes of
provisions relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a Pension Plan; (b) a
withdrawal by the Company or any ERISA Affiliate from a Pension Plan subject to
Section 4063 of ERISA during a plan year in which it was a substantial employer
(as defined in Section 4001(a)(2) of ERISA) or a cessation of operations which
is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete
or partial withdrawal by the Company or any ERISA Affiliate from a Multiemployer
Plan or notification that a Multiemployer Plan is in reorganization; (d) the
filing of a notice of intent to terminate, the treatment of a Plan amendment as
a termination under Section 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e)
an event or condition which might reasonably be expected to constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability to the PBGC under Title IV of ERISA, other than PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon the Company or
any ERISA Affiliate.
"Event of Default" means any of the events or circumstances specified in Section
9.01.
"Excess Cash Flow" means, with respect to any fiscal period of the Company: (a)
the Company's Adjusted Net Earnings from Operations for such period; minus (b)
the sum of (i) all regularly scheduled installments of Indebtedness (and,
without duplication, mandatory reductions to the Lender's Commitments) which
were actually paid in cash (or made effective, in the case of Commitment
reductions) by the Company during such fiscal period; (ii) bank charges and
deferred financing fees and bank agency fees paid in cash during such period,
(iii) Capital Expenditures which were actually paid in cash by the Company and
its Subsidiaries during such fiscal period to the extent permitted hereunder,
other than any such payments already deducted in the computation of the
Company's Adjusted Net Earnings from Operations or pursuant to clause (i) above;
plus (c) the sum of (i) any depreciation and amortization expense deducted in
determining net income for such fiscal period; (ii) other non-cash charges
deducted in computing such net income; (iii) any decrease in the Company's
current assets other than cash during such period; and (iv) any increase in the
Company's current liabilities during such period; minus (d) the sum of (i) any
increase in such Company's current assets other than cash during such period;
and (ii) any decrease in such Company's current liabilities during such period.
"Exchange Act" means the Securities Exchange Act of 1934, and regulations
promulgated thereunder.
"Existing Defaults" has the meaning specified in the recitals to this Agreement.
"FDIC" means the Federal Deposit Insurance Corporation, and any Governmental
Authority succeeding to any of its principal functions.
"Federal Funds Rate" means, for any day, the rate set forth in the weekly
statistical release designated as H.15(519), or any successor publication,
published by the Federal Reserve Bank of New York (including any such successor,
"H.15(519)") on the preceding Business Day opposite the caption "Federal Funds
(Effective)"; or, if for any relevant day such rate is not so published on any
such preceding Business Day, the rate for such day will be the arithmetic mean
as determined by the Agent of the rates for the last transaction in overnight
Federal funds arranged prior to 9:00 a.m. (Chicago time) on that day by each of
three leading brokers of Federal funds transactions in Chicago, Illinois
selected by the Agent.
"Fiscal Quarter" means the quarterly accounting periods of the Company ending on
March 31, June 30, September 30 and December 31 of each fiscal year.
"Flow Assets" has the meaning specified in the recitals to this Agreement.
"Flow Purchaser" has the meaning specified in the recitals to this Agreement.
"Flow Sale" the disposition of the Flow Assets pursuant to the Flow Sale
Agreement.
"Flow Sale Agreement" has the meaning specified in the recitals to this
Agreement.
"Flow Sale Note" means that certain Junior Subordinated Note executed and
delivered by the Flow Purchaser and made payable to the Company in an aggregate
original principal amount of $4,000,000 in partial consideration of the Flow
Sale.
"Foreign Subsidiary" means each Subsidiary of the Company that is not a Domestic
Subsidiary.
"FRB" means the Board of Governors of the Federal Reserve System, and any
Governmental Authority succeeding to any of its principal functions.
"Further Taxes" means any and all present or future taxes, levies, assessments,
imposts, duties, deductions, fees, withholdings or similar charges (including,
without limitation, net income taxes and franchise taxes), and all liabilities
with respect thereto, imposed by any jurisdiction on account of amounts payable
or paid pursuant to Section 4.01.
"FX Trading Office" means the Foreign Exchange Trading Center #5193, San
Francisco, California, of B of A, or such other of B of A's offices as B of A
may designate from time to time.
"GAAP" means generally accepted accounting principles set forth from time to
time in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination; provided, however, that for purposes of all computations required
to be made with respect to compliance by the Company with Sections 8.13 through
8.16, such term shall mean generally accepted accounting principles as in effect
on the date of this Agreement, applied in a manner consistent with those used in
preparing the financial statements referred to in Section 6.11(a).
"Governmental Authority" means any nation or government, any state or other
political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
and any corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"Guaranteed Creditors" shall mean and include Agent, the Lenders, each Person
(other than any Credit Party) which is a party to a Permitted Swap Obligation if
such Person is or at the time of entry into such Permitted Swap Obligation was a
Lender or an Affiliate of a Lender, and LaSalle Bank, N.A., as provider of cash
management services to the Company with respect to up to $5,000,000 of
obligations owing to such institution with respect to such services.
"Guaranteed Obligations" shall mean (i) the full and prompt payment when due
(whether at the stated maturity, by acceleration or otherwise) of the principal
and interest (whether such interest is allowed as a claim in a bankruptcy
proceeding with respect to any Subsidiary Borrower or otherwise) on each Note
issued by a Subsidiary Borrower to each Lender, and Loans made under this
Agreement to any Subsidiary Borrower and all reimbursement obligations and
unpaid drawings with respect to Letters of Credit issued for the benefit of any
Subsidiary Borrower, together with all other Obligations (including obligations
which, but for the automatic stay under Section 362(a) of the Bankruptcy Code,
would become due) and liabilities (including, without limitation, indemnities,
fees and interest thereon) of any Subsidiary Borrower to such Lender now
existing or hereafter incurred under, arising out of or in connection with this
Agreement or any other Loan Documents and the due performance and compliance
with all terms, conditions and agreements contained in the Loan Documents by any
Subsidiary Borrower and (ii) the full and prompt payment when due (whether by
acceleration or otherwise) of all Obligations (including obligations which, but
for the automatic stay under Section 362(a) of the Bankruptcy Code or similar
proceeding under applicable law, would become due) of the Company or any
Subsidiary owing under any Permitted Swap Obligations entered into by the
Company or any Subsidiary with any Lender or any Affiliate thereof (even if such
Lender subsequently ceases to be a Lender under this Agreement for any reason)
so long as such Lender or Affiliate participates in such Permitted Swap
Obligations and their subsequent assigns, if any, whether now in existence or
hereafter arising, and the due performance and compliance with all terms,
conditions and agreements contained therein.
"Guarantor" means each Domestic Subsidiary of the Company and, to the extent
required or requested pursuant to Section 7.15, each other Foreign Subsidiary of
the Company.
"Guaranty Obligation" has the meaning specified in the definition of "Contingent
Obligation."
"Hazardous Materials" means all those substances that are regulated by, or which
may form the basis of liability or a standard of conduct under, any
Environmental Law, including any substance identified under any Environmental
Law as a pollutant, contaminant, hazardous waste, hazardous constituent, special
waste, hazardous substance, hazardous material, or toxic substance, or petroleum
or petroleum-derived substance or waste.
"Honor Date" has the meaning specified in Section 3.03(b).
"ING Funds" has the meaning specified in the recitals to this Agreement.
"ING Intercreditor Agreement" means that certain Intercreditor Agreement of even
date herewith among the ING Funds and the Collateral Agent with respect to such
parties' liens and security interests in the property of the Company and its
Subsidiaries.
"ING Loan" has the meaning specified in the recitals to this Agreement.
"ING Loan Agreement" has the meaning specified in the recitals to this
Agreement.
"Indebtedness" of any Person means, without duplication, (a) all indebtedness
for borrowed money; (b) all obligations issued, undertaken or assumed as the
deferred purchase price of property or services (other than trade payables
entered into in the ordinary course of business on ordinary terms); (c) all
non-contingent reimbursement or payment obligations with respect to Surety
Instruments and all L/C Obligations; (d) all obligations evidenced by notes,
bonds, debentures or similar instruments, including obligations so evidenced
incurred in connection with the acquisition of property, assets or businesses;
(e) all indebtedness created or arising under any conditional sale or other
title retention agreement, or incurred as financing, in either case with respect
to property acquired by the Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property); (f) all obligations with respect to
Capital Leases; (g) the principal balance outstanding under any synthetic lease,
tax retention operating lease, off-balance sheet loan or similar off-balance
sheet financing product to which such Person is a party, where such transaction
is considered borrowed money indebtedness for tax purposes but is classified as
an operating lease in accordance with GAAP; (h) all indebtedness referred to in
clauses (a) through (g) above secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien upon or in property (including accounts and contract rights) owned by
such Person, even though such Person has not assumed or become liable for the
payment of such Indebtedness; and (i) all Guaranty Obligations in respect of
indebtedness or obligations of others of the kinds referred to in clauses (a)
through (h) above. For all purposes of this Agreement, the Indebtedness of any
Person shall include all recourse Indebtedness of any partnership or joint
venture or limited liability company in which such Person is a general partner
or a joint venturer or a member.
"Indemnified Liabilities" has the meaning specified in Section 11.05.
"Indemnified Person" has the meaning specified in Section 11.05.
"Independent Auditor" has the meaning specified in Section 7.01(a).
"Insolvency Proceeding" means, with respect to any Person, (a) any case, action
or proceeding with respect to such Person before any court or other Governmental
Authority relating to bankruptcy, reorganization, insolvency, liquidation,
receivership, dissolution, winding-up or relief of debtors, or (b) any general
assignment for the benefit of creditors, composition, marshaling of assets for
creditors, or other, similar arrangement in respect of its creditors generally
or any substantial portion of its creditors; undertaken under U.S. federal,
state or foreign law, including the Bankruptcy Code.
"Intellectual Property Assignments" means, collectively, those certain patent
security agreements and trademark agreements duly executed and delivered by the
Company and certain Subsidiaries in favor of the Collateral Agent, for the
benefit of itself and the Guaranteed Creditors, as the same may be amended,
supplemented or otherwise modified from time to time.
"Intercompany Indebtedness" means Indebtedness of the Company, any Subsidiary
Borrower or any of their respective Subsidiaries which, in the case of any
Borrower, is owing to any Subsidiary of any Borrower and which, in the case of
any Subsidiary of any Borrower, is owing to any Borrower or any of their other
Subsidiaries.
"Interest Payment Date" means the last Business Day of each calendar month.
"Investments" has the meaning specified in Section 8.04.
"IRS" means the Internal Revenue Service, and any Governmental Authority
succeeding to any of its principal functions under the Code.
"Irregular Items" means, with respect to any period of determination, losses (or
income) from irregular charges incurred by the Company and its Subsidiaries on a
consolidated basis after determination of EBITDA and equity (or income) from
joint ventures and before determination of Net Income (excluding, however any
charges or losses of up to $2,000,000 in the aggregate incurred in connection
with the severance of employment of Xxxxxx X. Xxxxx), in each case with respect
to discontinued operations, extraordinary items, unusual losses (and gains),
changes in accounting principles or changes in estimates, and in each case
determined in accordance with GAAP.
"Issuance Date" has the meaning specified in Section 3.01(a).
"Issue" means, with respect to any Letter of Credit, to issue or to extend the
expiry of, or to renew or increase the amount of, such Letter of Credit; and the
terms "Issued," "Issuing" and "Issuance" have corresponding meanings.
"Issuing Lender" means B of A in its capacity as issuer of one or more Letters
of Credit hereunder, together with any replacement letter of credit issuer
arising under Section 10.01(b) or Section 10.09.
"Joint Venture" means a single-purpose corporation, partnership, limited
liability company, joint venture or other similar legal arrangement (whether
created by contract or conducted through a separate legal entity) now or
hereafter formed by the Company or any of its Subsidiaries with another Person
in order to conduct a common venture or enterprise with such Person.
"Judgment Currency" has the meaning specified in Section 11.18.
"L/C Advance" means each Revolving Lender's participation in any L/C Borrowing
in accordance with its Pro Rata Share.
"L/C Amendment Application" means an application form for amendment of
outstanding standby or commercial documentary letters of credit as shall at any
time be in use at the Issuing Lender, as the Issuing Lender shall request.
"L/C Application" means an application form for issuances of standby or
commercial documentary letters of credit as shall at any time be in use at the
Issuing Lender, as the Issuing Lender shall request.
"L/C Borrowing" means an extension of credit resulting from a drawing under any
Letter of Credit which shall not have been reimbursed on the date when made nor
converted into a Borrowing of Revolving Loans under Section 3.03(c).
"L/C Commitment" means the commitment of the Issuing Lender to Issue, and the
commitment of the Revolving Lenders severally to participate in, Letters of
Credit from time to time Issued or outstanding under Article III, in an
aggregate amount not to exceed on any date the amount of $15,000,000, as the
same shall be reduced as a result of a reduction in the L/C Commitment pursuant
to Section 2.08; provided that the L/C Commitment is a part of the Available
Commitments, rather than a separate, independent commitment.
"L/C Obligations" means at any time the sum of (a) the aggregate undrawn amount
of all Letters of Credit then outstanding, plus (b) the amount of all
unreimbursed drawings under all Letters of Credit, including all outstanding L/C
Borrowings.
"L/C-Related Documents" means the Letters of Credit, the L/C Applications, the
L/C Amendment Applications and any other document relating to any Letter of
Credit, including any of the Issuing Lender's standard form documents for letter
of credit issuances.
"Lender" has the meaning specified in the introductory clause hereto.
References to the "Lenders" shall include B of A, including in its capacity as
Issuing Lender, and the Canadian Revolving Lender; for purposes of clarification
only, to the extent that B of A or the Canadian Revolving Lender may have any
rights or obligations in addition to those of the Lenders due to its status as
Issuing Lender or Canadian Revolving Lender, as the case may be, its status as
such will be specifically referenced.
"Letters of Credit" means any letter of credit that is Issued by the Issuing
Lender pursuant to Article III.
"Lien" means any security interest, mortgage, deed of trust, pledge,
hypothecation, assignment, charge or deposit arrangement, encumbrance, lien
(statutory or other) or preferential arrangement of any kind or nature
whatsoever in respect of any property (including those created by, arising under
or evidenced by any conditional sale or other title retention agreement, the
interest of a lessor under a capital lease, any financing lease having
substantially the same economic effect as any of the foregoing, or the filing of
any financing statement naming the owner of the asset to which such lien relates
as debtor, under the Uniform Commercial Code or any comparable law) and any
contingent or other agreement to provide any of the foregoing, but not including
the interest of a lessor under an operating lease.
"Loan" means an extension of credit by a Lender to a Credit Party under Article
II or Article III in the form of a Revolving Loan, Swing Line Loan, Canadian
Revolving Loan or L/C Borrowing.
"Loan Documents" means this Agreement, any Notes, the L/C-Related Documents, the
Collateral Documents, the ING Intercreditor Agreement, the Warrant Documents and
all other documents delivered to the Agent or any Lender in connection herewith.
"Majority Lenders" means, at any time, Lenders then holding in excess of 66 2/3%
of the then aggregate unpaid principal amount of the Loans, or if no Loans are
outstanding, Lenders then having in excess of 66 2/3% of the aggregate amount of
the Commitments.
"Margin Stock" means "margin stock" as such term is defined in Regulation T, U
or X of the FRB.
"Material Adverse Effect" means (a) a material adverse change in, or a material
adverse effect upon, the operations, business, properties, condition (financial
or otherwise) or prospects of the Company or the Company and its Subsidiaries
taken as a whole; (b) a material impairment of the ability of the Company or any
Subsidiary to perform under any Loan Document and to avoid any Event of Default;
or (c) a material adverse effect upon the legality, validity, binding effect or
enforceability against the Company or any Subsidiary of any Loan Document.
"Mexican Borrower" means ABC-NACO Latino America, S.A. de C.V. (formerly
ABC-NACO de Mexico S.A. de C.V.), a Mexican corporation.
"Mexican Subsidiaries" means, collectively, the Mexican Borrower, ABC-NACO
Servicios Ferroviarios, S.A. de C.V., a Mexican corporation, Comercializadora
National Castings, S.A. de C.V., a Mexican corporation, National Castings de
Mexico, S.A. de C.V., a Mexican corporation, and Servicios National Castings,
S.A. de C.V., a Mexican corporation.
"Mexican Subsidiary Guaranty" means that certain Guaranty, dated as of February
19, 1999 by the Mexican Subsidiaries in favor of the Collateral Agent, on behalf
of the Agent and the Lenders, as the same may be amended, supplemented or
otherwise modified from time to time.
"Mexican Subsidiary Loan Sublimit" means $5,000,000.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" means a "multiemployer plan," within the meaning of Section
4001(a)(3) of ERISA, to which the Company or any ERISA Affiliate makes, is
making, or is obligated to make contributions or, during the preceding three
calendar years, has made, or been obligated to make, contributions.
"Mortgages" means those certain mortgages and deeds of trusts executed and
delivered by the Company and certain Subsidiaries in favor of the Collateral
Agent, on behalf of the Agent and the Lenders, as the same may be amended,
supplemented or otherwise modified from time to time.
"Net Income" shall mean for any period, the net income (or loss) of the Company
and its Subsidiaries on a consolidated basis for such period taken as a single
accounting period determined in conformity with GAAP, provided that there shall
be excluded (i) the income (or loss) of any entity accrued prior to the date it
becomes a Subsidiary of the Company or is merged into or consolidated with the
Company or any Subsidiary or on which its assets are acquired by the Company or
any Subsidiary of the Company, (ii) the net income (loss) of any Person which is
not a consolidated Subsidiary except to the extent of the amount of cash
dividends or distributions paid to the Company or to a consolidated Subsidiary
of the Company and (iii) the income of any Subsidiary of the Company to the
extent that the declaration or payment of dividends or similar distributions by
that Subsidiary of that income is not at the time permitted by operation of the
terms of its charter or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to that Subsidiary.
"Net Proceeds" means (a) with respect to any sale of property or collection of
the proceeds of any tax refund, the sum of cash or readily marketable cash
equivalents received (including by way of a cash generating sale or discounting
of a note or receivable, but excluding any other consideration received in the
form of assumption by the acquiring Person of debt or other obligations relating
to the properties or assets so disposed of or received in any other non-cash
form) therefrom, whether at the time of such sale or collection or subsequent
thereto, or (b) with respect to any sale or issuance of equity or debt
securities of the Company or any Subsidiary, cash or readily marketable cash
equivalents received (but excluding any other non-cash form) therefrom, whether
at the time of such sale or issuance or subsequent thereto, net, in the case of
either clause (a) or (b), of all out-of-pocket legal, title and recording tax
expenses, commissions and other fees and all out-of-pocket costs and expenses
incurred and all federal, state, local and other taxes required to be accrued as
a liability as a consequence of such transactions.
"Note" means a promissory note executed by the Company, Mexican Borrower or
Canadian Borrower in favor of a Lender pursuant to Section 2.02, in
substantially the form of Exhibit G-1 or G-2 or G-3 or G-4, as applicable.
"Notice of Borrowing" means a notice in substantially the form of Exhibit A.
"Notice of Canadian Revolving Loan Refunding" has the meaning specified in
Section 2.05(b)(i).
"Obligations" means all advances, debts, liabilities, obligations, covenants and
duties arising under any Loan Document owing by any Credit Party to any Lender,
the Agent, the Collateral Agent, or any Indemnified Person, whether direct or
indirect (including those acquired by assignment), absolute or contingent, due
or to become due, now existing or hereafter arising.
"Organization Documents" means, for any corporation, the certificate or articles
of incorporation, the bylaws, any certificate of determination or instrument
relating to the rights of preferred shareholders of such corporation, any
shareholder rights agreement, and all applicable resolutions of the board of
directors (or any committee thereof) of such corporation.
"Other Taxes" means any present or future stamp, court or documentary taxes or
any other excise or property taxes, charges or similar levies which arise from
any payment made hereunder or from the execution, delivery, performance,
enforcement or registration of, or otherwise with respect to, this Agreement or
any other Loan Documents.
"Participant" has the meaning specified in Section 11.08(d).
"PBGC" means the Pension Benefit Guaranty Corporation, or any Governmental
Authority succeeding to any of its principal functions under ERISA.
"Pension Plan" means a pension plan (as defined in Section 3(2) of ERISA)
subject to Title IV of ERISA which the Company sponsors, maintains, or to which
it makes, is making, or is obligated to make contributions, or in the case of a
multiple employer plan (as described in Section 4064(a) of ERISA) has made
contributions at any time during the immediately preceding five (5) plan years.
"Permitted Foreign Subsidiary Indebtedness" has the meaning specified in
Section 8.05(f).
"Permitted Liens" has the meaning specified in Section 8.01.
"Permitted Swap Obligations" means all obligations (contingent or otherwise) of
the Company or any Subsidiary existing or arising under Swap Contracts entered
into prior to the date hereof and listed on Schedule 1.01-B, provided that each
of the following criteria is satisfied: (a) such obligations are (or were)
entered into by such Person in the ordinary course of business for the purpose
of directly mitigating risks associated with liabilities, commitments or assets
held or reasonably anticipated by such Person, or changes in the value of
securities issued by such Person in conjunction with a securities repurchase
program not otherwise prohibited hereunder, and not for purposes of speculation
or taking a "market view" and (b) such Swap Contracts do not contain any
provision ("walk-away" provision) exonerating the non-defaulting party from its
obligation to make payments on outstanding transactions to the defaulting party.
"Person" means an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated association,
joint venture or Governmental Authority.
"Plan" means an employee benefit plan (as defined in Section 3(3) of ERISA)
which the Company sponsors or maintains or to which the Company makes, is
making, or is obligated to make contributions and includes any Pension Plan.
"Pledge Agreements" means, collectively, those certain pledge agreement, duly
executed and delivered by each of the Company and certain Subsidiaries pledging
the stock of its Subsidiaries to the Collateral Agent, for the benefit of itself
and Guaranteed Creditors, as the same may be amended, supplemented or otherwise
modified from time to time.
"Pledged Collateral" has the meaning specified in the relevant Pledge Agreement.
"Projections" has the meaning specified in Section 6.11(b).
"Property" means any interest in any kind of property or asset, whether real,
personal or mixed, and whether tangible or intangible.
"Pro Rata Share" means, as to any Revolving Lender at any time, the percentage
equivalent (expressed as a decimal, rounded to the ninth decimal place) at such
time of such Revolving Lender's Commitment divided by the combined Commitments
of all Revolving Lenders, or, if the Commitments have been terminated, such
Lender's outstanding Loans and L/C Obligations divided by the combined
outstanding Loans and L/C Obligations of the Revolving Lenders.
"Released Claims" has the meaning specified in Section 11.21.
"Releases" has the meaning specified in Section 11.21.
"Reportable Event" means, any of the events set forth in Section 4043(c) of
ERISA or the regulations thereunder, other than any such event for which the
30-day notice requirement under ERISA has been waived in regulations issued by
the PBGC.
"Requirement of Law" means, as to any Person, any law (statutory or common),
treaty, rule or regulation or determination of an arbitrator or of a
Governmental Authority, in each case applicable to or binding upon the Person or
any of its property or to which the Person or any of its property is subject.
"Responsible Officer" means the chief executive officer, the president, the
executive vice president-treasury, corporate development and secretary, the
executive vice president and chief administrative officer or the corporate
treasurer of the Company, or any other officer having substantially the same
authority and responsibility; or, with respect to compliance with financial
covenants, the vice president and chief accounting officer or the corporate
treasurer of the Company, or any other officer having substantially the same
authority and responsibility.
"Restructuring Documents" means, collectively, this Agreement, the other Loan
Documents, the ING Loan Agreement, the Series C Preferred Agreement, the ING
Intercreditor Agreement, the Flow Sale Agreement, the Series B Exchange
Agreement and each agreement, document, instrument described in such agreement
and to be executed or delivered on the Closing Date pursuant to such agreements.
"Restructuring Transactions" means (i) the restatement and amendment of the
Existing Credit Agreement pursuant to the terms and conditions of this Agreement
and the execution and delivery of each of the other Loan Documents being
executed and delivered on the Closing Date, (ii) the funding of the ING Loan
pursuant to the terms and conditions of the ING Loan Agreement, (iii) the
execution and delivery of the Series C Preferred Agreement, (iv) the
consummation of the Flow Sale pursuant to the terms and conditions of the Flow
Sale Agreement and (iv) the exchange of the Company's Series B Preferred Stock
for the Company's Series B-1 Preferred Stock pursuant to the Series B Exchange
Agreement.
"Revolving Lenders" means each of the Lenders other than the Canadian Revolving
Lender.
"Revolving Loan" has the meaning specified in Section 2.01.
"S&P" means Standard & Poor's Ratings Group, a division of the XxXxxx-Xxxx
Companies, Inc. or any successor thereto.
"Scheduled Commitment Reduction" has the meaning specified in Section 2.8(b).
"SEC" means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
"Security Agreements" means, collectively, those certain security agreements
executed and delivered by each of the Company and certain Subsidiaries in favor
of the Collateral Agent, for the benefit of itself and the Guaranteed Creditors,
as the same may be amended, supplemented or otherwise modified from time to
time.
"Series B Exchange Agreement" that certain Exchange Agreement dated as of April
17, 2001 among the Company and the holders of the Series B Preferred Stock.
"Series B Preferred Stock" means the Company's Series B Cumulative Convertible
Preferred Stock.
"Series B-1 Preferred Stock" means the Company's Series B-1 Cumulative
Convertible Participating Preferred Stock.
"Series C Preferred Agreement" has the meaning specified in the recitals to this
Agreement.
"Series C Preferred Stock" means the Company's Series C Convertible Preferred
Stock.
"Solvent" means, when used with respect to a Person, that (a) the fair saleable
value of the assets of such Person is in excess of the total amount of the
present value of its liabilities (including for purposes of this definition all
liabilities (including loss reserves as determined by such Person), whether or
not reflected on a balance sheet prepared in accordance with GAAP and whether
direct or indirect, fixed or contingent, secured or unsecured, disputed or
undisputed), (b) such Person is able to pay its debts or obligations in the
ordinary course as they mature and (c) such Person does not have unreasonably
small capital to carry out its business as conducted and as proposed to be
conducted. "Solvency" shall have a correlative meaning.
"Spot Rate" for a currency means the rate quoted by B of A as the spot rate for
the purchase by B of A of such currency with another currency through its FX
Trading Office at approximately 8:00 a.m. (San Francisco time) on the date two
Business Days prior to the date as of which the foreign exchange computation is
made.
"SubDebt" Consent Solicitation" means the Company's written request of the
trustee and holders of notes under the Subordinated Debt Indenture of a waiver
of any and all existing violations by the Company of its financial covenants
under such indenture for the periods ended December 31, 2000 and March 31, 2001
and an amendment with respect to such financial covenants for subsequent periods
during 2001 and 2002 to the extent the Projections indicate that a material risk
of noncompliance with respect to any such financial covenants during such
periods may occur.
"Subordinated Debt" means all Indebtedness evidenced by the Subordinated Debt
Indenture and the related notes issued thereunder and all interest, fees,
premiums, redemption, rescission claims and other amounts among thereunder or
with respect thereto.
"Subordinated Debt Indenture" means that certain Indenture dated as of January
15, 1997 between the Company (formerly known as ABC Rail Products Corporation)
and U.S. Bank National Association (as successor trustee to First Trust National
Association, formerly First Trust of Illinois, National Association), as
trustee, as amended and supplemented by that certain First Supplemental
Indenture dated as of January 15, 1997, that certain Second Supplemental
Indenture dated as of December 1, 1997, that certain Third Supplemental
Indenture dated as of September, 2000, that certain Officer's Certificate dated
as of January 29, 1997 with respect to the Company's 10% Senior Subordinated
Notes, Series A, Due 2004, and that certain Officer's Certificate dated as of
December 17, 1997 with respect to the Company's 10% Senior Subordinated Notes,
Series B, Due 2004.
"Subsidiary" of a Person means any corporation, association, partnership,
limited liability company, joint venture or other business entity of which more
than 50% of the voting stock, membership interests or other equity interests (in
the case of Persons other than corporations), is owned or controlled directly or
indirectly by the Person, or one or more of the Subsidiaries of the Person, or a
combination thereof. Unless the context otherwise clearly requires, references
herein to a "Subsidiary" refer to a Subsidiary of the Company.
"Subsidiary Borrower" means either of Mexican Borrower or Canadian Borrower.
"Subsidiary Guaranty" means those certain guaranties duly executed and delivered
by the Guarantors in favor of the Agent, on behalf of the Guaranteed Creditors,
as the same may be amended, supplemented or otherwise modified from time to
time.
"Surety Instruments" means all letters of credit (including standby and
documentary), banker's acceptances, bank guaranties, shipside bonds, surety
bonds and similar instruments.
"Swap Contract" means any agreement, whether or not in writing, relating to any
transaction that is a rate swap, basis swap, forward rate transaction, commodity
swap, commodity option, equity or equity index swap or option, bond, note or
xxxx option, interest rate option, forward foreign exchange transaction, cap,
collar or floor transaction, currency swap, cross-currency rate swap, swaption,
currency option or any other, similar transaction (including any option to enter
into any of the foregoing) or any combination of the foregoing, and, unless the
context otherwise clearly requires, any master agreement relating to or
governing any or all of the foregoing.
"Swap Termination Value" means, in respect of any one or more Swap Contracts,
after taking into account the effect of any legally enforceable netting
agreement relating to such Swap Contracts, (a) for any date on or after the date
such Swap Contracts have been closed out and termination value(s) determined in
accordance therewith, such termination value(s), and (b) for any date prior to
the date referenced in clause (a) the amount(s) determined as the xxxx-to-market
value(s) for such Swap Contracts, as determined by the Company based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include any Lender).
"Swing Line Commitment" means at any time, the obligation of the Swing Line
Lender to make Swing Line Loans pursuant to Section 2.04.
"Swing Line Lender" means B of A, in its capacity as provider of the Swing Line
Loans.
"Swing Line Loan" means a Loan made by the Swing Line Lender.
"Swing Line Note" means a promissory note in substantially the form of Exhibit
G-4.
"Swing Line Rate" means, at any time, for each Swing Line Loan, the Base Rate
plus the Applicable Margin in respect of Base Rate Loans.
"Taxes" means any and all present or future taxes, levies, assessments, imposts,
duties, deductions, fees, withholdings or similar charges, and all liabilities
with respect thereto, excluding, in the case of each Lender and the Agent,
respectively, taxes imposed on or measured by its net income by the jurisdiction
(or any political subdivision thereof) under the laws of which such Lender or
the Agent, as the case may be, is organized or maintains a Lending Office.
"Termination Date" means the earlier to occur of:
(a) January 5, 2003; and
(b) the date on which the Commitments terminate in accordance with the
provisions of this Agreement.
"Unfunded Pension Liability" means the excess of a Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Plan's assets, determined in accordance with the assumptions used for funding
the Pension Plan pursuant to Section 412 of the Code for the applicable plan
year.
"Uniform Commercial Code" means the Uniform Commercial Code, as in effect from
time to time in the relevant jurisdiction.
"United States" and "U.S." each means the United States of America.
"Warrant Documents" means that certain Warrant Purchase Agreement of even date
herewith among the Company, the Agent and the Lenders, together with each of
those certain Warrants to Purchase Common Stock issued thereunder by the Company
to each of the Lenders, that certain Registration Rights Agreement, and that
certain Tag-Along Rights Agreement, in each case, executed and delivered in
connection therewith and as the same may be amended, supplemented or otherwise
modified from time to time.
"Wholly-Owned Subsidiary" means any corporation, association, partnership,
limited liability company, joint venture or other business entity in which
(other than directors' qualifying shares required by law) 100% of the equity
interests of each class having ordinary voting power, and 100% of the equity
interests of every other class, in each case, at the time as of which any
determination is being made, is owned, beneficially and of record, by the
Company, or by one or more of the other Wholly-Owned Subsidiaries, or both.
"Wholly-Owned Domestic Subsidiary" and "Wholly-Owned Foreign Subsidiary" shall
have correlative meanings.
1.02 Other Interpretive Provisions.
(a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.
(b) The words "hereof", "herein", "hereunder" and similar words refer to
this Agreement as a whole and not to any particular provision of this Agreement;
and Section, Schedule and Exhibit references are to this Agreement unless
otherwise specified.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other writings,
however evidenced.
(ii) The term "including" is not limiting and means "including without
limitation."
(iii) 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."
(iv) The term "property" includes any kind of property or asset, real,
personal or mixed, tangible or intangible.
(d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Agreement) and other contractual instruments shall be
deemed to include all subsequent amendments and other modifications thereto, but
only to the extent such amendments and other modifications are not prohibited by
the terms of any Loan Document, and (ii) references to any statute or regulation
are to be construed as including all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting the statute or
regulation.
(e) The captions and headings of this Agreement are for convenience of
reference only and shall not affect the interpretation of this Agreement.
(f) This Agreement and 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 cumulative and shall each be
performed in accordance with their terms. Unless otherwise expressly provided,
any reference to any action of the Agent or the Lenders by way of consent,
approval or waiver shall be deemed modified by the phrase "in its/their sole
discretion."
(g) This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Agent, the Company
and the other parties, and are the products of all parties. Accordingly, they
shall not be construed against the Lenders or the Agent merely because of the
Agent's or the Lenders' involvement in their preparation.
1.03 Accounting Principles.
(a) Unless the context otherwise clearly requires, all accounting terms
not expressly defined herein shall be construed, and all financial computations
required under this Agreement shall be made, in accordance with GAAP,
consistently applied in accordance with past practices.
(b) References herein to "fiscal year" and "fiscal quarter" refer to such
fiscal periods of the Company.
(c) In the event that any changes in GAAP occur after the date of this
Agreement and such changes result in a material variation in the method of
calculation of financial covenants or other terms of this Agreement, then the
Company, the Agent and the Lenders agree to amend such provisions of this
Agreement so as to equitably reflect such changes so that the criteria for
evaluating the Company's financial condition will be the same after such changes
as if such changes had not occurred.
1.04 Currency Equivalents Generally. For all purposes of this
Agreement (but not for purposes of the preparation of any financial statements
delivered pursuant hereto), the equivalent in Canadian Dollars of an amount in
Dollars, and the equivalent in Dollars of an amount in Canadian Dollars, shall
be determined at the Spot Rate.
1.05 Restatement and Amendment; Effect.
(a) Upon the effectiveness of this
Agreement pursuant to Section 5.01, this Agreement shall amend and restate in
its entirety the Existing Credit Agreement, and all "Loans," "Letters of
Credit," "L/C Obligations," interest, fees, reimbursement claims, indemnity
claims, and other "Obligations" under the Existing Credit Agreement (as each of
such terms are defined therein) shall constitute Loans, Letters of Credit, L/C
Obligations and Obligations under and as defined in this Agreement. Without
limiting the foregoing, none of such Obligations shall be deemed to have been
repaid or refinanced pursuant to this Agreement upon the effectiveness hereof
nor shall such effectiveness be deemed to effect a novation thereof.
(b) All interest and fees which are accrued and unpaid under the
Existing Credit Agreement as of the effectiveness of this Agreement shall be due
and payable on the next due date for interest and fees, as applicable, pursuant
to the terms of this Agreement. Notwithstanding anything herein to the
contrary, all "Offshore Rate Loans" which are outstanding under and defined in
the Existing Credit Agreement as of the effectiveness of this Agreement, if any,
shall automatically convert into Base Rate Loans pursuant to this Agreement upon
the expiration of each applicable "Interest Period" (as defined in the Existing
Credit Agreement) which is pending with respect to such Loans as of the Closing
Date and shall remain subject to the terms of Section 4.04 of the Existing
Credit Agreement until the time of such conversion.
1.06 Waiver of Existing Defaults. Effective upon the satisfaction of
each of the conditions set forth in Section 5.01, each of the Lenders hereby
waives each of the Existing Defaults under the Existing Credit Agreement.
Notwithstanding such waiver, no waiver is being hereby given with respect to any
Event of Default or Default under and as defined in this Agreement whether or
based upon the same or similar events or conditions giving use to the Existing
Defaults.
ARTICLE II
THE CREDITS
2.01 Amounts and Terms of Commitments. Each Revolving Lender severally
agrees, on the terms and conditions set forth herein, to make loans to the
Company or to the Mexican Borrower denominated in Dollars (each such loan, a
"Revolving Loan") from time to time on any Business Day during the period from
the Closing Date to the Termination Date, in an aggregate principal Dollar
Equivalent amount not to exceed at any time outstanding the amount set forth
opposite such Lender's name on Schedule 2.01 (such amount, as the same may be
reduced pursuant to the terms hereof, the Lender's "Commitment"); provided,
however, that, after giving effect to any Borrowing of Revolving Loans
(exclusive of Revolving Loans which are repaid with the proceeds of, and
simultaneously with the incurrence of, the respective incurrence of Revolving
Loans), the Effective Amount of all outstanding Loans and the Effective Amount
of all L/C Obligations shall not at any time exceed the combined Available
Commitments or Available Commitment, respectively (and the Effective Amount of
the Revolving Loans of any Lender plus such Revolving Lender's Pro Rata Share of
the Effective Amount of all Canadian Revolving Loans plus the participation of
such Lender in the Effective Amount of all L/C Obligations shall not at any time
exceed such Lender's Available Commitment as may be reduced pursuant to the
terms hereof); provided further that, the Mexican Borrower shall only be
permitted to make borrowings of Revolving Loans denominated in Dollars not
exceeding the Mexican Subsidiary Loan Sublimit. Within the limits of each
Revolving Lender's combined Available Commitments or Available Commitment,
respectively, and subject to the other terms and conditions hereof, the
Borrowers may borrow under this Section 2.01, prepay under Section 2.07, and
reborrow under this Section 2.01.
2.02 Loan Accounts; Notes.
(a) The Loans made by each Lender and the Letters of Credit Issued by
the Issuing Lender shall be evidenced by one or more accounts or records
maintained by such Lender or Issuing Lender, as the case may be, in the ordinary
course of business. The loan accounts or records maintained by the Agent, the
Issuing Lender and each Lender shall be presumed correct absent manifest error
of the amount of the Loans made by the Lenders to the applicable Borrower and
the Letters of Credit Issued for the account of the Company, and the interest
and payments thereon. Any failure so to record or any error in doing so shall
not, however, limit or otherwise affect the obligation of the Company, Mexican
Borrower or Canadian Borrower hereunder to pay any amount owing with respect to
the Loans or any Letter of Credit.
(b) Upon the request of any Lender made through the Agent, the Loans made by
such Lender may be evidenced by one or more Notes, instead of or in addition to
loan accounts. Each such Lender shall record on the schedules annexed to its
Note(s) the date, amount and maturity of each Loan made by it and the amount and
Applicable Currency of each payment of principal made by the applicable Borrower
with respect thereto. Each such Lender is irrevocably authorized by the
applicable Borrower to make such recordations on its Note(s) and each Lender's
record shall be presumed correct absent manifest error; provided, however, that
the failure of a Lender to make, or an error in making, a notation thereon with
respect to any Loan shall not limit or otherwise affect the obligations of the
applicable Borrower hereunder or under any such Note to such Lender.
(c) On the Closing Date, the Company shall execute and deliver in favor
of each Lender a substitute and amended Note in the form of Exhibit G-1 hereto,
the Mexican Borrower shall execute and deliver in favor of each Lender a
substitute and amended Note in the form of Exhibit G-2 hereto, the Canadian
Borrower shall execute and deliver in favor of the Canadian Revolving Lender a
substitute and amended Note in the form of Exhibit G-3 hereto, and the Company
shall execute and deliver in favor of the Swing Line Lender a substitute and
amended Note in the form of Exhibit G-4 hereto. Each such substitute and
amended Note shall replace the respective Notes held by the Lenders prior to the
Closing Date pursuant to the Existing Credit Agreement. Such issuance of
substitute and amended Notes hereunder shall not constitute or evidence a
refinancing or novation of the indebtedness theretofore evidenced by such
previous Notes, but merely a modification and replacement of such previous
Notes. Promptly following its receipt of such substitute and amended Notes
hereunder and the satisfaction of the conditions set forth in Section 5.01, each
Lender shall deliver to the Agent each previous Note it held pursuant to the
Existing Credit Agreement and, upon the Agent's receipt of such previous Notes,
the Agent shall xxxx such Notes as "substituted and amended" and shall return
each such previous Note to the Company.
2.03 Procedure for Borrowing by the Company or the Mexican Borrower.
(a) Each Borrowing by the Company or the Mexican Borrower (other than
an L/C Borrowing) shall be made upon the Company's (acting on behalf of the
applicable Borrower) irrevocable written notice delivered to the Agent in the
form of a Notice of Borrowing, which notice must be received by the Agent prior
to 11:00 a.m. (Chicago time) on the date of the requested Borrowing Date,
specifying:
(i) the amount of the Borrowing, which shall be in an aggregate minimum
amount of $1,000,000, or any multiple of $100,000 in excess thereof; and
(ii) the requested Borrowing Date, which shall be a Business Day.
(b) Each Revolving Lender will make the amount of its Pro Rata Share of
each Borrowing available to the Agent for the account of the applicable Borrower
at the Agent's Payment Office on the Borrowing Date requested by the applicable
Borrower in immediately available funds by 2:00 p.m. (Chicago time). The
proceeds of all such Loans will promptly thereafter be made available to the
applicable Borrower by the Agent at such office by crediting the account of the
Borrower on the books of B of A with the aggregate of the amounts made available
to the Agent by the Lenders and in like funds as received by the Agent.
(c) The Borrowers hereby authorize the Lenders and the Agent to accept
Notices of Borrowing based on telephonic notices made by any person or persons
the Agent or any Lender in good faith believes to be acting on behalf of the
applicable Borrowers. The Company or the applicable Borrower agrees to deliver
promptly to the Agent a written confirmation of each telephonic notice, signed
by a Responsible Officer or an authorized designee. If the written confirmation
differs in any material respect from the action taken by the Agent and the
Lenders, the records of the Agent and the Lenders shall govern absent manifest
error.
2.04 The Swing Line Loans.
(a) Subject to the terms and conditions hereof, the Swing Line Lender
agrees to make Swing Line Loans to the Company denominated in Dollars from time
to time prior to the Termination Date in an aggregate principal amount at any
one time outstanding not to exceed $20,000,000 (the "Swing Line Commitment");
provided, that after giving effect to any such Swing Line Loan, the Effective
Amount of all Loans, Swing Line Loans and the Effective Amount of all L/C
Obligations at such time would not exceed the aggregate Available Commitments of
all of the Lenders at such time. Prior to the Termination Date, the Company may
use the Swing Line Commitment by borrowing, prepaying the Swing Line Loans in
whole or in part, and reborrowing, all in accordance with the terms and
conditions hereof. All Swing Line Loans shall bear interest at the Swing Line
Rate.
(b) The Company may borrow under the Swing Line Commitment on any Business
Day until the Termination Date; provided, that the Company shall give the Swing
Line Lender irrevocable written notice signed by a Responsible Officer or an
authorized designee (which notice must be received by the Swing Line Lender
prior to 12:00 p.m. (Chicago time)) with a copy to the Agent specifying the
amount of the requested Swing Line Loan, which shall be in a minimum amount of
$100,000 or a whole multiple of $100,000 in excess thereof. The proceeds of the
Swing Line Loan will be made available by the Swing Line Lender to the Company
in immediately available funds at the office of the Swing Line Lender by 1:00
p.m. (Chicago time) on the date of such notice. The Company may at any time and
from time to time, prepay the Swing Line Loans, in whole or in part, without
premium or penalty, by notifying the Swing Line Lender prior to 11:00 a.m.
(Chicago time) on any Business Day of the date and amount of prepayment with a
copy to the Agent. If any such notice is given, the amount specified in such
notice shall be due and payable on the date specified therein. Partial
prepayments shall be in an aggregate principal amount of $100,000 or a whole
multiple of $100,000 in excess thereof.
(c) If any Swing Line Loan shall remain outstanding at 11:00 a.m. (Chicago
time) on the fifth Business Day following the date of such Swing Line Loan or on
the last Business Day of the month of such Swing Line Loan, and if by such time
on such Business Day the Agent shall have received neither (i) a Notice of
Borrowing delivered by the Company pursuant to Section 2.03 requesting that
Revolving Loans be made pursuant to Section 2.01 on the immediately succeeding
Business Day in an amount at least equal to the principal amount of such Swing
Line Loan nor (ii) any other notice satisfactory to the Agent indicating the
Company's intent to repay such Swing Line Loan on or before the immediately
succeeding Business Day with funds obtained from other sources, then on such
Business Day the Swing Line Lender shall (and on any Business Day the Swing Line
Lender in its sole discretion may), on behalf of the Company (which hereby
irrevocably directs the Swing Line Lender to act on its behalf) request the
Agent to notify each Revolving Lender to make a Base Rate Loan in an amount
equal to such Revolving Lender's Pro Rata Share of (A) in the case of such a
request which is required to be made, the amount of the relevant Swing Line Loan
and (B) in the case of such a discretionary request, the aggregate principal
amount of the Swing Line Loans outstanding on the date such notice is given;
provided, that absent notice by the Company to the contrary by such time on such
fifth Business Day, the Company shall be deemed to have requested, at the end of
such five Business Day period, that each outstanding Swing Line Loan be extended
for an additional period of five Business Days, so long as the conditions
specified in Section 5.02 would be satisfied at the beginning of each such
additional period, treating each such extension as if it were the making of a
new Loan. Unless any of the events described in subsection 9.01(f) or (g) shall
have occurred with respect to the Company (in which event the procedures of
paragraph (e) of this Section 2.04 shall apply) each Revolving Lender shall make
the proceeds of its Revolving Loan available to the Agent for the account of the
Swing Line Lender at the Agent's Payment Office in funds immediately available
prior to 1:00 p.m. (Chicago time) on the Business Day next succeeding the date
such notice is given. The proceeds of such Revolving Loans shall be immediately
applied to repay the outstanding Swing Line Loans. Effective on the day such
Revolving Loans are made, the portion of the Swing Line Loans so paid shall no
longer be outstanding as Swing Line Loans and shall no longer be due under the
Swing Line Note. The Company shall pay to the Swing Line Lender, promptly
following the Swing Line Lender's demand, the amount of its outstanding Swing
Line Loans to the extent amounts received from the Revolving Lenders are not
sufficient to repay in full such outstanding Swing Line Loans.
(d) Notwithstanding anything herein to the contrary, the Swing Line Lender
(i) shall not be obligated to make any Swing Line Loan if the conditions set
forth in Article V have not been satisfied and (ii) shall not make any requested
Swing Line Loan if, prior to noon (Chicago time) on the day immediately
preceding the date of such requested Swing Line Loan, it has received a written
notice from the Agent or any Revolving Lender directing it not to make further
Swing Line Loans because one or more of the conditions specified in Article V
are not then satisfied.
(e) If prior to the making of a Revolving Loan required to be made by
Section 2.04(c) an Event of Default described in subsection 9.01(f) or 9.01(g)
shall have occurred and be continuing with respect to the Company, each
Revolving Lender will, on the date such Revolving Loan was to have been made
pursuant to the notice described in Section 2.04(c), purchase an undivided
participating interest in the outstanding Swing Line Loans in an amount equal to
its Pro Rata Share of the aggregate principal amount of Swing Line Loans then
outstanding. Each Revolving Lender will immediately transfer to the Agent for
the benefit of the Swing Line Lender, in immediately available funds, the amount
of its participation.
(f) Whenever, at any time after a Revolving Lender has purchased a
participating interest in a Swing Line Loan, the Swing Line Lender receives any
payment on account thereof, the Swing Line Lender will distribute to the Agent
for delivery to each Revolving Lender its participating interest in such amount
(appropriately adjusted, in the case of interest payments, to reflect the period
of time during which such Revolving Lender's participating interest was
outstanding and funded); provided, however, that in the event that such payment
received by the Swing Line Lender is required to be returned, such Revolving
Lender will return to the Agent for delivery to the Swing Line Lender any
portion thereof previously distributed by the Agent or the Swing Line Lender to
it.
(g) Each Lender's obligation to make the Revolving Loans referred to in
subsection 2.04(c) and to purchase participating interests pursuant to
subsection 2.04(e) shall be absolute and unconditional and shall not be affected
by any circumstance, including without limitation (i) any set-off, counterclaim,
recoupment, defense or other right which such Revolving Lender or the Company
may have against the Swing Line Lender, the Company or any other Person for any
reason whatsoever, (ii) the occurrence or continuance of a Default or an Event
of Default, (iii) any adverse change in the condition (financial or otherwise)
of the Company, (iv) any breach of this Agreement or any other Loan Document by
the Company, any Subsidiary or any other Lender, or (v) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing.
2.05 Canadian Revolving Loans.
(a) Subject to the terms and conditions hereof and to the specific
provisions set forth on Schedule 2.05 hereto, the Canadian Revolving Lender
agrees to make loans or other extensions of credit to the Canadian Borrower
denominated in Dollars or Canadian Dollars (each such loan or extension of
credit, a "Canadian Revolving Loan") from time to time prior to the Termination
Date, in an aggregate principal Effective Amount at any time outstanding not to
exceed the Canadian Subsidiary Loan Sublimit; provided, however, that, after
giving effect to any such Canadian Revolving Loans (exclusive of the Effective
Amount of Canadian Revolving Loans which are repaid with the proceeds of, and
simultaneously with the incurrence of, the respective incurrence of Canadian
Revolving Loans), the Effective Amount of all outstanding Loans and the
Effective Amount of all L/C Obligations shall not at any time exceed the
combined Available Commitments of the Revolving Lenders.
(b) (i) If any Event of Default under Section 9.01(a), 9.01(f) or 9.01(g)
shall occur and be continuing, the Canadian Revolving Lender may, in its sole
and absolute discretion, direct that the Canadian Revolving Loans owing to it be
refunded by delivering a notice (with such detail as the Agent shall request, a
"Notice of Canadian Revolving Loan Refunding") to the Agent. Upon receipt of
such notice, the Agent shall (A) promptly give notice of the contents thereof to
the Revolving Lenders and, unless an Event of Default described in Section
9.01(f) or 9.01(g) shall have occurred, to each Borrower and (B) calculate the
Dollar Equivalent Amount of the aggregate principal amount of the Canadian
Revolving Loans outstanding as of the date the Agent received such Notice of
Canadian Revolving Loan Refunding (the "Dollar Refunding Amount"). Each such
Notice of Canadian Revolving Loan Refunding shall be deemed to constitute
delivery of a notice to the Agent requesting each Revolving Lender to purchase
an undivided participating interest in the outstanding Canadian Revolving Loans
whereupon each Revolving Lender shall purchase an undivided participating
interest in the outstanding Canadian Revolving Loans in a Dollar Equivalent
Amount equal to such Revolving Lender's Pro Rata Share of the aggregate
principal amount of such Canadian Revolving Loans. Each Revolving Lender shall
immediately transfer to the Canadian Revolving Lender, in immediately available
funds, the amount of its participation. From and after the date of any such
purchase of any participating interests, the Agent will act as Collateral Agent
in respect of the Collateral securing the Canadian Revolving Loans for the
benefit of each Lender who has purchased such a participating interest.
(ii) Whenever, at any time after a Revolving Lender has purchased a
participating interest in a Canadian Revolving Loan, the Canadian Revolving
Lender receives any payment on account thereof, the Canadian Revolving Lender
will distribute to the Agent for delivery to each Revolving Lender its
participating interest in such amount (appropriately adjusted, in the case of
interest payments, to reflect the period of time during which such Revolving
Lender's participating interest was outstanding and funded); provided, however,
that in the event that such payment received by the Canadian Revolving Lender is
required to be returned, such Revolving Lender will return to the Agent for
delivery to the Canadian Revolving Lender any portion thereof previously
distributed by the Agent or the Canadian Revolving Lender to it.
(iii) Each Revolving Lender's obligation to purchase the participating
interests referred to in subsection 2.05(b)(ii) shall be absolute and
unconditional and shall not be affected by any circumstance, including, without
limitation, (i) any set-off, counterclaim, recoupment, defense or other right
which such Revolving Lender or the Company may have against the Canadian
Revolving Lender, the Company or any other Person for any reason whatsoever,
(ii) the occurrence or continuance of a Default or an Event of Default, (iii)
any adverse change in the condition (financial or otherwise) of the Company,
(iv) any breach of this Agreement or any other Loan Document by the Company, any
Subsidiary or any other Lender, or (v) any other circumstance, happening or
event whatsoever, whether or not similar to any of the foregoing.
2.06 Voluntary Termination or Reduction of Available Commitments. The
Company may, upon not less than one Business Days' prior written notice to the
Agent, terminate the Available Commitments or permanently reduce the Available
Commitments by an aggregate minimum amount of $1,000,000 or any multiple of
$1,000,000 in excess thereof; unless, after giving effect thereto and to any
prepayments of Revolving Loans made on the effective date thereof, (a) the then
outstanding Dollar Equivalent Effective Amount of all Loans and L/C Obligations
together would exceed the amount of the combined Available Commitments then in
effect, (b) the Effective Amount of all L/C Obligations then outstanding would
exceed the L/C Commitment, (c) the Effective Amount of all Revolving Loans to
Mexican Borrower would exceed the Mexican Subsidiary Loan Sublimit or (d) the
Effective Amount of all Canadian Revolving Loans to Canadian Borrower would
exceed the Canadian Subsidiary Loan Sublimit. Once reduced in accordance with
this Section, the Available Commitments as so reduced may not be increased.
Absent notice as set forth in this Section 2.06, no voluntary prepayment of
Loans shall permanently reduce the Available Commitments. Any reduction of the
Available Commitments shall be applied to each Lender according to its Pro Rata
Share. If and to the extent specified by the Company in the notice to the
Agent, some or all of the reduction in the combined Available Commitments shall
be applied to reduce the L/C Commitment and/or the Mexican Subsidiary Loan
Sublimit and/or the Canadian Subsidiary Loan Sublimit (with, in such case, a
copy of such notice to the Canadian Revolving Lender). All accrued Available
Commitment fees and letter of credit fees to, but not including, the effective
date of any reduction or termination of the Available Commitments shall be paid
on the effective date of such reduction or termination.
2.07 Prepayments.
(a) Without premium or penalty, the Company or the Mexican Borrower
may, at any time or from time to time, by 11:00 a.m. (Chicago time) on the day
of such prepayment in the case of Base Rate Loans, prepay Revolving Loans
ratably among the Lenders in whole or in part in minimum Dollar Equivalent
amounts of $1,000,000, or any Dollar Equivalent multiple of $100,000 in excess
thereof. Such notice of prepayment shall specify the applicable Borrower, the
date and amount of such prepayment. Such notice shall not thereafter be
revocable by the applicable Borrower, and the Agent will promptly notify each
Lender of its receipt of any such notice, and of such Lender's Pro Rata Share of
such prepayment. If such notice is given by a Borrower, such Borrower shall
make such prepayment and the payment amount specified in such notice shall be
due and payable on the date specified therein, together with accrued interest to
each such date on the amount prepaid.
(b) If on any day the Agent shall have determined that the Dollar Equivalent
Effective Amount of all Loans and L/C Obligations then outstanding exceeds the
combined Available Commitments of the Lenders, then the Borrower shall
immediately, and without notice or demand, make prepayments of Loans such that,
after giving effect to all such prepayments, the Effective Amount of all Loans
plus the Effective Amount of L/C Obligations does not exceed the combined
Available Commitments.
(c) If on any date the Effective Amount of L/C Obligations exceeds the L/C
Commitment, the Company shall Cash Collateralize on such date the outstanding
Letters of Credit in an amount equal to the excess of the maximum amount then
available to be drawn under the Letters of Credit over the L/C Commitment. If
on any date after giving effect to any Cash Collateralization made on such date
pursuant to the preceding sentence, the Effective Amount of all Revolving Loans
then outstanding plus the Effective Amount of all L/C Obligations exceeds the
combined Available Commitments, the Company shall immediately, and without
notice or demand, prepay the outstanding principal amount of the Revolving Loans
and L/C Advances by an amount equal to the applicable excess.
(d) If on any day (a "Computation Date") the Canadian Revolving Lender or
the Agent shall have determined that the Dollar Equivalent Effective Amount of
all Canadian Revolving Loans then outstanding exceeds the Canadian Subsidiary
Loan Sublimit by more than 2% of the Canadian Subsidiary Loan Sublimit due to a
change in applicable rates of exchange between Dollars and the Canadian Dollar,
then the Canadian Revolving Lender may in its sole discretion require the Agent
to, or the Agent in its own discretion may, give notice to the Canadian Borrower
that a prepayment is required under this section, and Canadian Borrower agrees
thereupon to immediately make a prepayment of Canadian Revolving Loans such
that, after giving effect to all such prepayments, the Effective Amount of all
Canadian Revolving Loans does not exceed the Canadian Subsidiary Loan Sublimit.
(e) On the Business Day of its receipt of the proceeds from the sale of any
property of the Company or any Subsidiary, its receipt of any insurance or
condemnation proceeds with respect to any property of the Company or any
Subsidiary, or the receipt of the proceeds of any tax refund by the Company or
any Subsidiary, the Company shall prepay the Revolving Loans in an amount equal
to 100% of the Net Proceeds realized upon any such receipt of proceeds;
provided, however, that (i) no such prepayment shall be required with respect to
sales of inventory in the ordinary course of the Company's and the Subsidiaries'
business (other than bulk sales of inventory or sales of scrap or obsolete
inventory), (ii) no such prepayment shall be required with respect to up to
$1,500,000 in gross consideration after the Closing Date from sales of obsolete
equipment and scrap inventory, (iii) the proceeds from the collection of the
Signal Division receivables, the Signal Division sale escrow, and any other
payments received by the Company or its Subsidiaries with respect to its sale of
the Signal Division, in each case pursuant to or in connection with that certain
Stock Purchase Agreement dated as of February 23, 2001 among the Company,
ABC-NACO Rail Systems Inc., Track Holding Inc. and Balfour Xxxxxx, Inc., shall
result in required prepayments under this subsection in accordance with Schedule
2.07(e), (iv) the Company shall prepay the Revolving Loans in the amount of
$15,500,000 concurrently with the consummation of the Flow Sale, and (v) no
prepayment shall be required with respect to proceeds of casualty insurance if
the Company shall have notified the Agent within 30 days of the casualty that it
intends to repair or rebuild the property subject to such casualty, the Company
shall have provided the Agent within 90 days of the casualty with a detailed
plan (including actual contractor's bids and specifications) for such repair or
rebuilding, the Company or affected Subsidiary shall have in good faith
proceeded and continue to proceed, diligently with such plan, the Company shall
present all invoices for the expenses of such plan prior to making any payments
with respect to such plan, and such repair or rebuilding shall have been
substantially completed within 120 days of such casualty. Concurrently with
each prepayment of the Revolving Loans pursuant to this Section 2.07(e), the
Available Commitments shall be permanently reduced by the required amount of
such prepayment and, in addition, the Scheduled Commitment Reduction(s) next
succeeding the date of such prepayment shall be reduced by the amount of such
prepayment; provided, however, that upon the consummation of the Flow Sale, the
Commitments shall be reduced to $156,500,000 and no additional adjustment to the
Scheduled Commitment Reductions shall be made concurrently with such sale at
such time. Notwithstanding the foregoing, if, following the Closing Date, any
additional payments are made to or on behalf of the Company or its Subsidiaries
pursuant to the Flow Sale Agreement, the Company shall thereupon immediately
prepay the Revolving Loans, and the Available Commitments shall be thereupon
permanently reduced, in amounts equal to such payments pursuant to this
subsection as if the Company had received Net Proceeds from an asset sale in
such amounts. Each such prepayment and reduction of the Available Commitments
and Scheduled Commitment Reductions shall be allocated ratably among the
Revolving Lenders in accordance with their respective Pro Rata Shares. The
Company shall use its best efforts to notify the Agent and each Revolving Lender
of each transaction giving rise to any required prepayment hereunder as soon as
practicable and in no event later than ten (10) Business Days before such
transaction is consummated.
(f) On the Business Day of its receipt by the Company or any Subsidiary of
the proceeds from the sale or issuance of any equity securities (including,
without limitation, the issuance of options, warrants or convertible securities,
and the issuance of equity securities upon the exercise or conversion of any
such options, warrants or convertible securities) or issuance or incurrence of
Indebtedness for borrowed money, the Company shall prepay the Revolving Loans in
an amount equal to 100% of the Net Proceeds realized upon such receipt of
proceeds; provided, however, that (i) no such prepayment shall be required with
respect to the issuance or incurrence of the ING Loan on the Closing Date, (ii)
no such prepayment shall be required with respect to the issuance of Series C
Preferred Stock pursuant to the Series C Preferred Agreement to the extent the
proceeds of such issuance are used to repay in full the outstanding principal
balance of the ING Loan on the date of such issuance, (iii) no such prepayment
shall be required with respect to the issuance by the Company of stock options
to the Company's management, or the exercise of such options, provided the
aggregate Net Proceeds received by the Company and its Subsidiaries after the
Closing Date with respect to such options does not exceed $1,000,000, no such
prepayment shall be required with respect to any cashless exercise or
cancellation of stock options, or with respect to any cashless conversion of
Series B Preferred Stock, Series B-1 Preferred Stock, or Series C Preferred
Stock in any case into common stock, (v) no such prepayment shall be required
with respect to the issuance or incurrence of Indebtedness permitted under
clause (d) or (e) of Section 8.05 hereof, (vi) no such prepayment shall be
required with respect to the issuance of any warrants pursuant to the Warrant
Documents, (vii) no such prepayment shall be required with respect to the
issuance of Series B-1 Preferred Stock pursuant to the Series B Exchange
Agreement and (viii) the Company shall prepay the Revolving Loans an amount
equal to the greater of the Bancomer Prepayment Amount and 50% of the Net
Proceeds of Bancomer Financing. Concurrently with each prepayment of the
Revolving Loans pursuant to this Section 2.07(f), the Available Commitments
shall be permanently reduced by the required amount of such prepayment and, in
addition, the Scheduled Commitment Reduction(s) next succeeding the date of such
prepayment shall be reduced by the amount of such prepayment. Each such
prepayment and reduction of the Available Commitments and Scheduled Commitment
Reductions shall be allocated ratably among the Revolving Lenders in accordance
with their respective Pro Rata Shares. The Company shall use its best efforts
to notify the Agent and each Revolving Lender of each transaction giving rise to
any required prepayment hereunder as soon as practicable and in no event later
than ten (10) Business Days before such transaction is consummated.
(g) On April 15, 2002 (or such earlier date on which the Company delivers
pursuant to Section 7.01(a) its annual financial statements to the Agent with
respect to the Company fiscal year ending December 31, 2001), the Company shall
prepay the Revolving Loans in an amount equal to 70% of Excess Cash Flow for its
fiscal year ended December 31, 2001. On the forty-fifth (45th) calendar day
immediately following the end of each of the Company's Fiscal Quarters ending on
or after March 31, 2002 (or, with respect to any such Fiscal Quarters, such
earlier date on which the Company delivers pursuant Section 7.01(b) its
quarterly financial statements to the Agent with respect to such Fiscal
Quarter), the Company shall prepay the Revolving Loans in an amount equal to 70%
of Excess Cash Flow for such Fiscal Quarter ended. Concurrently with each
prepayment of the Revolving Loans pursuant to this Section 2.07(g), the
Available Commitments shall be permanently reduced by the required amount of
such prepayment and, in addition, the Scheduled Commitment Reduction(s) next
succeeding the date of such prepayment shall be reduced by the amount of such
prepayment. Each such prepayment and reduction of the Available Commitments and
Scheduled Commitment Reductions shall be allocated ratably among the Revolving
Lenders in accordance with their respective Pro Rata Shares.
2.08 Repayments and Scheduled Commitment Reductions.
(a) The Borrowers shall repay to the Lenders in full on the Termination
Date the aggregate principal amount of their respective Loans and other
obligations outstanding on such date.
(b) Notwithstanding anything to the contrary herein and independent of any
other obligation to make any reduction of the Commitments, the aggregate
Commitments shall be permanently reduced on the following dates by the amounts
set forth opposite such date, as such amounts may be reduced pursuant to Section
2.07 (each, a "Scheduled Commitment Reduction").
Scheduled
Date Commitment Reduction
12/31/01 $ 4,500,000
4/15/02 $ 2,000,000
1/5/03 $ 150,000,000.
(c) Concurrently with each Scheduled Commitment Reduction, the
Company shall prepay the Revolving Loans the extent the Dollar Equivalent
Effective Amount of the aggregate outstanding principal balance of all Loans and
L/C Obligations exceeds the Available Commitment after giving effect to such
Scheduled Commitment Reduction.
(d) Each reduction of the Commitments pursuant to clause (b) above
shall be applied to each Lender in accordance with its Pro Rata Share and the
Commitments once reduced may not be increased.
2.09 Interest.
(a) Each Revolving Loan and Canadian Revolving Loan shall bear interest
on the outstanding principal amount thereof from the applicable Borrowing Date
at a rate per annum equal to the Base Rate, plus the Applicable Margin.
(b) Interest on each Loan shall be paid in arrears on each Interest Payment
Date; provided, however, that during the existence of any Event of Default,
interest shall be additionally paid by the Company upon demand by the Agent at
the request or with the consent of the Majority Lenders.
(c) Notwithstanding Section 2.09(a), while any Event of Default exists or
after acceleration, the applicable Borrower shall pay interest (after as well as
before entry of judgment thereon to the extent permitted by law) on the
principal amount of all outstanding Obligations, at a rate per annum which is
determined by adding 2% per annum to the applicable interest rate otherwise then
in effect for such Loans.
(d) Anything herein to the contrary notwithstanding, the obligations of each
Borrower to any Lender hereunder shall be subject to the limitation that
payments of interest shall not be required for any period for which interest is
computed hereunder, to the extent (but only to the extent) that contracting for
or receiving such payment by such Lender would be contrary to the provisions of
any law applicable to such Lender limiting the highest rate of interest that may
be lawfully contracted for, charged or received by such Lender, and in such
event applicable Borrower shall pay such Lender interest at the highest rate
permitted by applicable law.
2.10 Fees. In addition to certain fees described in Section 3.08:
(a) Restructuring Fees. The Company shall pay to the Agent for the
benefit of the Lenders and to be allocated ratably in accordance with their Pro
Rata Shares, a restructuring fee in the amount of $1,500,000, $750,000 of which
shall be due and payable on the Closing Date and the remaining $750,000 of which
shall due and payable on the earlier of January 5, 2003 and the date on which
the Obligations are otherwise required to be or are voluntarily paid in full.
All of such fees shall be payable in immediately available funds and, regardless
of the due dates thereof, shall be fully-earned and non-refundable as of the
Closing Date.
(b) Agency Fees. The Company shall pay to the Agent, for the Agent's own
account, agent's fees (i) on the Closing Date, in the amount of $150,000 and
(ii) on February 1, 2002 (or such earlier date on which the obligations are
otherwise required to be or are voluntarily paid in full), in the amount of
$200,000. All of such fees shall be payable in immediately available funds and,
regardless of the due dates thereof, shall be fully-earned and non-refundable as
of the Closing Date.
(c) Commitment Fees. The Company shall pay to the Agent for the account of
each Revolving Lender a commitment fee ("Commitment Fee") on the average daily
unused portion of such Lender's Commitment computed on a monthly basis in
arrears on the last Business Day of each calendar month based upon the daily
utilization for such month as calculated by the Agent, in an amount calculated
at a per annum rate of 0.60%. For purposes of calculating utilization under
this Section, the Commitments shall be deemed used to the extent of the
Effective Amount of Revolving Loans then outstanding plus the Effective Amount
of L/C Obligations then outstanding and shall not be deemed used by a Revolving
Lender's Pro Rata Share of Swing Line Loans or Canadian Revolving Loans. Such
commitment fee shall accrue from the Closing Date to the Termination Date and
shall be due and payable monthly in arrears on the last Business Day of each
calendar month through the Termination Date, with the final payment to be made
on the Termination Date; provided that, in connection with any reduction or
termination of Commitments, the accrued commitment fee calculated for the period
ending on such date shall also be paid on the date of such reduction or
termination, with the following monthly payment being calculated on the basis of
the period from such reduction or termination date to such monthly payment date.
The commitment fees provided in this Section shall accrue at all times after the
above-mentioned commencement date, including at any time during which one or
more conditions in Article V are not met.
2.11 Computation of Fees and Interest.
(a) All computations of interest shall be made on the basis of a year
of 365 or 366 days, as the case may be, and actual days elapsed. Interest and
fees shall accrue during each period during which interest or such fees are
computed from the first day thereof to the last day thereof.
(b) For purposes of determining utilization of each Lender's Commitment in
order to calculate the Commitment Fee due under Section 2.11(c), the amount of
any outstanding Canadian Revolving Loan shall be determined based upon the
Dollar Equivalent amount as of the most recent Computation Date with respect to
such Canadian Revolving Loan.
(c) Each determination of an interest rate or a Dollar Equivalent amount by
the Agent shall be conclusive and binding on the Company and the Lenders in the
absence of manifest error. The Agent will, at the request of the Company or any
Lender, deliver to the Company or the Lender, as the case may be, a statement
showing the quotations used by the Agent in determining any interest rate or
Dollar Equivalent amount.
2.12 Payments by the Borrowers.
(a) All payments to be made by any Borrower shall be made without
set-off, recoupment or counterclaim. Except for payments required to be made to
the Canadian Revolving Lender or as otherwise expressly provided herein, all
payments by any Borrower shall be made to the Agent for the account of the
Lenders at the Agent's Payment Office, and, with respect to principal of,
interest on, and any other amounts relating to, any Canadian Revolving Loan made
in Canadian Dollars shall be paid in Canadian Dollars and, with respect to all
other amounts payable hereunder, shall be made in Dollars. Such payments shall
be made in immediately available funds, and (i) in the case of Canadian
Revolving Loans, no later than such time on the dates specified herein as may be
determined by the Agent or the Canadian Revolving Lender, as the case may be, to
be necessary for such payment to be credited on such date in accordance with
normal banking procedures in the place of payment, and (ii) in the case of any
Dollar payments, no later than 11:00 a.m. (Chicago time) on the date specified
herein. The Agent will promptly distribute to each Revolving Lender its Pro
Rata Share (or other applicable share as expressly provided herein) of such
principal, interest, fees or other amounts, in like funds as received. Any
payment which is received by the Agent later than 11:00 a.m. (Chicago time) or
by the Canadian Revolving Lender later than 11:00 a.m. (Toronto time), as the
case may be, or later than the time specified by the Agent or the Canadian
Revolving Lender as provided in clause (i) above (in the case of Canadian
Revolving Loans), shall be deemed to have been received on the following
Business Day and any applicable interest or fee shall continue to accrue.
(b) Unless the Agent receives notice from the applicable Borrower prior to
the date on which any payment is due to the Lenders that such Borrower will not
make such payment in full as and when required, the Agent may assume that such
Borrower has made such payment in full to the Agent on such date in immediately
available funds and the Agent may (but shall not be so required), in reliance
upon such assumption, distribute to each Lender on such due date an amount equal
to the amount then due such Lender. If and to the extent such Borrower has not
made such payment in full to the Agent, each Lender shall repay to the Agent on
demand such amount distributed to such Lender, together with interest thereon at
the Federal Funds Rate or, in the case of a payment in an Offshore Currency, the
Overnight Rate, for each day from the date such amount is distributed to such
Lender until the date repaid.
2.13 Payments by the Lenders to the Agent.
(a) Unless the Agent receives notice from a Lender on or prior to the
Closing Date or, with respect to any Borrowing after the Closing Date, at least
one Business Day prior to the date of such Borrowing, that such Lender will not
make available as and when required hereunder to the Agent for the account of
the applicable Borrower the amount of that Lender's Pro Rata Share of the
Borrowing, the Agent may assume that each Lender has made such amount available
to the Agent in immediately available funds on the Borrowing Date and the Agent
may (but shall not be so required), in reliance upon such assumption, make
available to the applicable Borrower on such date a corresponding amount. If
and to the extent any Lender shall not have made its full amount available to
the Agent in immediately available funds and the Agent in such circumstances has
made available to the applicable Borrower such amount, that Lender shall on the
Business Day following such Borrowing Date make such amount available to the
Agent, together with interest at the Federal Funds Rate for each day during such
period. A notice of the Agent submitted to any Lender with respect to amounts
owing under this Section 2.13(a) shall be conclusive absent manifest error. If
such amount is so made available, such payment to the Agent shall constitute
such Lender's Loan on the date of Borrowing for all purposes of this Agreement.
If such unfunded amount is not made available to the Agent on the Business Day
following the Borrowing Date, the Agent will promptly notify the applicable
Borrower of such failure to fund and, upon demand by the Agent, the applicable
Borrower shall pay such unfunded amount to the Agent for the Agent's account,
together with interest thereon for each day elapsed since the date of such
Borrowing, at a rate per annum equal to the interest rate applicable at the time
to the Loans comprising such Borrowing.
(b) The failure of any Lender to make any Loan on any Borrowing Date shall
not relieve any other Lender of any obligation hereunder to make a Loan on such
Borrowing Date, but no Lender shall be responsible for the failure of any other
Lender to make the Loan to be made by such other Lender on any Borrowing Date.
2.14 Sharing of Payments, Etc. If, other than as expressly provided
elsewhere herein, any Revolving Lender shall obtain on account of the Loans made
by it any payment (whether voluntary, involuntary, through the exercise of any
right of set-off, or otherwise) in excess of its ratable share (or other share
contemplated hereunder), such Lender shall immediately (a) notify the Agent of
such fact, and (b) purchase from the other Revolving Lenders such participations
in the Loans made by them as shall be necessary to cause such purchasing Lender
to share the excess payment pro rata with each of them; provided, however, that
if all or any portion of such excess payment is thereafter recovered from the
purchasing Lender, such purchase shall to that extent be rescinded and each
other Lender shall repay to the purchasing Lender the purchase price paid
therefor, together with an amount equal to such paying Lender's ratable share
(according to the proportion of (i) the amount of such paying Lender's required
repayment to (ii) the total amount so recovered from the purchasing Lender) of
any interest or other amount paid or payable by the purchasing Lender in respect
of the total amount so recovered. Each Borrower agrees that any Lender so
purchasing a participation from another Lender may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off, but subject to Section 11.10) with respect to such participation as
fully as if such Lender were the direct creditor of the applicable Borrower in
the amount of such participation. The Agent will keep records (which shall be
presumed correct and binding in the absence of manifest error) of participations
purchased under this Section and will in each case notify the Lenders following
any such purchases or repayments.
ARTICLE III
THE LETTERS OF CREDIT
3.01 The Letter of Credit Subfacility.
(a) On the terms and conditions set forth herein (i) the Issuing Lender
agrees, (A) from time to time on any Business Day during the period from the
Closing Date to the day which is five days prior to the Termination Date to
issue Letters of Credit denominated in Dollars or Canadian Dollars for the
account of the Company, and to amend or renew Letters of Credit previously
issued by it, in accordance with Sections 3.02(c) and (d), and (B) to honor
conforming drafts under the Letters of Credit; and (ii) the Revolving Lenders
severally agree to participate in Letters of Credit Issued for the account of
the Company; provided, that the Issuing Lender shall not be obligated to Issue,
and no Revolving Lender shall be obligated to participate in, any Letter of
Credit if as of the date of Issuance of such Letter of Credit (the "Issuance
Date") (1) the Effective Amount of all L/C Obligations plus the Effective Amount
of all Loans exceeds the combined Available Commitments, (2) the participation
of any Lender in the Effective Amount of all L/C Obligations plus the Effective
Amount of the Revolving Loans of such Lender plus such Lender's Pro Rata Share
of the Effective Amount of all outstanding Canadian Revolving Loans exceeds such
Lender's Available Commitment or, (3) the Effective Amount of L/C Obligations
exceeds the L/C Commitment. Within the foregoing limits, and subject to the
other terms and conditions hereof, the Company's ability to obtain Letters of
Credit shall be fully revolving, and, accordingly, the Company may, during the
foregoing period, obtain Letters of Credit to replace Letters of Credit which
have expired or which have been drawn upon and reimbursed.
(b) The Issuing Lender is under no obligation to Issue any Letter of Credit
if:
(i) any order, judgment or decree of any Governmental Authority or
arbitrator shall by its terms purport to enjoin or restrain the Issuing Lender
from Issuing such Letter of Credit, or any Requirement of Law applicable to the
Issuing Lender or any request or directive (whether or not having the force of
law) from any Governmental Authority with jurisdiction over the Issuing Lender
shall prohibit, or request that the Issuing Lender refrain from, the Issuance of
letters of credit generally or such Letter of Credit in particular or shall
impose upon the Issuing Lender with respect to such Letter of Credit any
restriction, reserve or capital requirement (for which the Issuing Lender is not
otherwise compensated hereunder) not in effect on the Closing Date, or shall
impose upon the Issuing Lender any unreimbursed loss, cost or expense which was
not applicable on the Closing Date and which the Issuing Lender in good xxxxx
xxxxx material to it;
(ii) the Issuing Lender has received written notice from any Lender, the
Agent or the Company, on or prior to the Business Day prior to the requested
date of Issuance of such Letter of Credit, that one or more of the applicable
conditions contained in Article V is not then satisfied;
(iii) the expiry date of any requested Letter of Credit is after the
Termination Date, unless the Company has Cash Collateralized, in form and
substance satisfactory to the Issuing Lender, its L/C Obligations under such
Letter of Credit on or prior to the date of the Issuance of such Letter of
Credit;
(iv) any requested Letter of Credit does not provide for drafts, or is not
otherwise in form and substance acceptable to the Issuing Lender, or the
Issuance of a Letter of Credit shall violate any applicable policies of the
Issuing Lender; or
(v) such Letter of Credit is in a face amount less than $25,000, unless such
lesser amount is approved by the Agent and the Issuing Lender.
3.02 Issuance, Amendment and Renewal of Letters of Credit.
(a) Each Letter of Credit shall be issued upon the irrevocable written
request of the Company received by the Issuing Lender (with a copy sent by the
Company to the Agent) at least three days (or such shorter time as the Issuing
Lender may agree in a particular instance in its sole discretion) prior to the
proposed date of issuance. Each such request for issuance of a Letter of Credit
shall be by facsimile, confirmed immediately in an original writing, in the form
of an L/C Application, and shall specify in form and detail satisfactory to the
Issuing Lender: (i) the proposed date of issuance of the Letter of Credit (which
shall be a Business Day); (ii) the face amount of the Letter of Credit; (iii)
the expiry date of the Letter of Credit; (iv) the name and address of the
beneficiary thereof; (v) the documents to be presented by the beneficiary of the
Letter of Credit in case of any drawing thereunder; (vi) the full text of any
certificate to be presented by the beneficiary in case of any drawing
thereunder; and (vii) such other matters as the Issuing Lender may require.
(b) Prior to the Issuance of any Letter of Credit, the Issuing Lender will
confirm with the Agent (by telephone or in writing) that the Agent has received
a copy of the L/C Application or L/C Amendment Application from the Company and,
if not, the Issuing Lender will provide the Agent with a copy thereof. Unless
the Issuing Lender has received notice (including any notice from a Lender
pursuant to Section 3.01(b)(ii)) on or before the Business Day the Issuing
Lender is to issue a requested Letter of Credit from the Agent (A) directing the
Issuing Lender not to issue such Letter of Credit because such issuance is not
then permitted under Section 3.01(a) as a result of the limitations set forth in
clauses (1) through (3) thereof or Section 3.01(b)(i); or (B) that one or more
conditions specified in Article V are not then satisfied; then, subject to the
terms and conditions hereof, the Issuing Lender shall, with the written approval
of the Agent, on the requested date, issue a Letter of Credit for the account of
the Company in accordance with the Issuing Lender's usual and customary business
practices.
(c) From time to time while a Letter of Credit is outstanding and prior to
the Termination Date, the Issuing Lender will, upon the written request of the
Company received by the Issuing Lender (with a copy sent by the Company to the
Agent) at least three days (or such shorter time as the Issuing Lender may agree
in a particular instance in its sole discretion) prior to the proposed date of
amendment, amend any Letter of Credit issued by it. Each such request for
amendment of a Letter of Credit shall be made by facsimile, confirmed
immediately in an original writing, made in the form of an L/C Amendment
Application and shall specify in form and detail satisfactory to the Issuing
Lender: (i) the Letter of Credit to be amended; (ii) the proposed date of
amendment of the Letter of Credit (which shall be a Business Day); (iii) the
nature of the proposed amendment; and (iv) such other matters as the Issuing
Lender may require. The Issuing Lender shall be under no obligation to amend
any Letter of Credit if: (A) the Issuing Lender would have no obligation at
such time to issue such Letter of Credit in its amended form under the terms of
this Agreement; or (B) the beneficiary of any such Letter of Credit does not
accept the proposed amendment to the Letter of Credit. The Agent will promptly
notify the Lenders of the receipt by it of any L/C Application, L/C Amendment
Application or notice of renewal.
(d) The Issuing Lender and the Lenders agree that, while a Letter of Credit
is outstanding and prior to the Termination Date, at the option of the Company
and upon the written request of the Company received by the Issuing Lender (with
a copy sent by the Company to the Agent) at least five days (or such shorter
time as the Issuing Lender may agree in a particular instance in its sole
discretion) prior to the proposed date of notification of renewal, the Issuing
Lender shall be entitled to authorize the automatic renewal of any Letter of
Credit issued by it. Each such request for renewal of a Letter of Credit shall
be made by facsimile, confirmed immediately in an original writing, in the form
of an L/C Amendment Application, and shall specify in form and detail
satisfactory to the Issuing Lender: (i) the Letter of Credit to be renewed; (ii)
the proposed date of notification of renewal of the Letter of Credit (which
shall be a Business Day); (iii) the revised expiry date of the Letter of Credit;
and (iv) such other matters as the Issuing Lender may require. The Issuing
Lender shall be under no obligation to renew any Letter of Credit if: (A) the
Issuing Lender would have no obligation at such time to issue or amend such
Letter of Credit in its renewed form under the terms of this Agreement; or (B)
the beneficiary of any such Letter of Credit does not accept the proposed
renewal of the Letter of Credit. If any outstanding Letter of Credit shall
provide that it shall be automatically renewed unless the beneficiary thereof
receives notice from the Issuing Lender that such Letter of Credit shall not be
renewed, and if at the time of renewal the Issuing Lender would be entitled to
authorize the automatic renewal of such Letter of Credit in accordance with this
clause (d) upon the request of the Company but the Issuing Lender shall not have
received any L/C Amendment Application from the Company with respect to such
renewal or other written direction by the Company with respect thereto, the
Issuing Lender shall nonetheless be permitted to allow such Letter of Credit to
renew, and the Company and the Lenders hereby authorize such renewal, and,
accordingly, the Issuing Lender shall be deemed to have received an L/C
Amendment Application from the Company requesting such renewal.
(e) The Issuing Lender may, at its election (or as required by the Agent at
the direction of the Majority Lenders), deliver any notices of termination or
other communications to any Letter of Credit beneficiary or transferee, and take
any other action as necessary or appropriate, at any time and from time to time,
in order to cause the expiry date of such Letter of Credit to be a date not
later than the date which is five days prior to the Termination Date.
(f) This Agreement shall control in the event of any conflict with any
L/C-Related Document (other than any Letter of Credit).
(g) The Issuing Lender will also deliver to the Agent, concurrently or
promptly following its delivery of a Letter of Credit, or amendment to or
renewal of a Letter of Credit, to an advising lender or a beneficiary, a true
and complete copy of each such Letter of Credit or amendment to or renewal of a
Letter of Credit.
3.03 Risk Participations, Drawings and Reimbursements.
(a) Immediately upon the Issuance of each Letter of Credit, each Lender
shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the Issuing Lender a participation in such Letter of Credit and
each drawing thereunder in an amount equal to the product of (i) the Pro Rata
Share of such Lender, times (ii) the maximum amount available to be drawn under
such Letter of Credit and the amount of such drawing, respectively. For
purposes of Section 2.01, each Issuance of a Letter of Credit shall be deemed to
utilize the Available Commitment of each Lender by an amount equal to the amount
of such participation.
(b) In the event of any request for a drawing under a Letter of Credit by
the beneficiary or transferee thereof, the Issuing Lender will promptly notify
the Company. The Company shall reimburse the Issuing Lender (by an L/C
Borrowing or otherwise) prior to 12:00 Noon (Chicago time) on each date that any
amount is paid by the Issuing Lender under any Letter of Credit (each such date,
an "Honor Date"), in an amount equal to the amount so paid by the Issuing Lender
(such amount, in the case of a Letter of Credit denominated in Canadian Dollars,
being deemed to be the Dollar equivalent of the amount drawn, determined on the
basis of the Spot Rate for such currency as of the approximate time of such
drawing). In the event the Company fails to reimburse the Issuing Lender for
the full amount of any drawing under any Letter of Credit by 12:00 Noon (Chicago
time) on the Honor Date, the Issuing Lender will promptly notify the Agent and
the Agent will promptly notify each Lender thereof, and the Company shall be
deemed to have requested that Base Rate Loans in an aggregate amount equal to
the unreimbursed drawing be made by the Lenders to be disbursed on the Honor
Date under such Letter of Credit, subject to the availability provisions of
Section 2.01 and subject to the conditions set forth in Section 5.02. Any
notice given by the Issuing Lender or the Agent pursuant to this clause (b) may
be oral if immediately confirmed in writing (including by facsimile); provided,
that the lack of such an immediate confirmation shall not affect the
conclusiveness or binding effect of such notice.
(c) Each Lender shall upon any notice pursuant to Section 3.03(b) make
available to the Agent for the account of the relevant Issuing Lender an amount
in Dollars and in immediately available funds equal to its Pro Rata Share of the
amount of the drawing, whereupon the participating Lenders shall (subject to
Section 3.03(d)) each be deemed to have made a Revolving Loan consisting of a
Base Rate Loan to the Company in that amount. If any Lender so notified fails
to make available to the Agent for the account of the Issuing Lender the amount
of such Lender's Pro Rata Share of the amount of the drawing by no later than
2:00 p.m. (Chicago time) on the Honor Date, then interest shall accrue on such
Lender's obligation to make such payment, from the Honor Date to the date such
Lender makes such payment, at a rate per annum equal to the Federal Funds Rate
in effect from time to time during such period. The Agent will promptly give
notice of the occurrence of the Honor Date, but failure of the Agent to give any
such notice on the Honor Date or in sufficient time to enable any Lender to
effect such payment on such date shall not relieve such Lender from its
obligations under this Section 3.03 once notice has been provided.
(d) With respect to any unreimbursed drawing that is not converted into
Revolving Loans consisting of Base Rate Loans to the Company in whole or in
part, because of the Company's failure to satisfy the conditions set forth in
Section 5.02 or for any other reason, the Company shall be deemed to have
incurred from the Issuing Lender an L/C Borrowing in the amount of such drawing
(such amount, in the case of a Letter of Credit denominated in Canadian dollars,
being deemed to be the Dollar equivalent of the amount drawn, determined on the
basis of the Spot Rate for such currency as of the approximate time of such
drawing), which L/C Borrowing shall be due and payable on demand (together with
interest) and shall bear interest at a rate per annum equal to the Base Rate
plus the Applicable Margin for Base Rate Loans plus 2% per annum, and each
Lender's payment to the Issuing Lender pursuant to Section 3.03(c) shall be
deemed payment in respect of its participation in such L/C Borrowing and shall
constitute an L/C Advance from such Lender in satisfaction of its participation
obligation under this Section 3.03.
(e) Each Lender's obligation in accordance with this Agreement to make the
Revolving Loans or L/C Advances, as contemplated by this Section 3.03, as a
result of a drawing under a Letter of Credit, shall be absolute and
unconditional and without recourse to the Issuing Lender and shall not be
affected by any circumstance, including (i) any set-off, counterclaim,
recoupment, defense or other right which such Lender may have against the
Issuing Lender, the Company or any other Person for any reason whatsoever; (ii)
the occurrence or continuance of a Default, an Event of Default or a Material
Adverse Effect; or (iii) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing; provided, however, that each
Lender's obligation to make Revolving Loans under this Section 3.03 is subject
to the conditions set forth in Section 5.02.
3.04 Repayment of Participations.
(a) Upon (and only upon) receipt by the Agent for the account of the
Issuing Lender of immediately available funds from the Company (i) in
reimbursement of any payment made by the Issuing Lender under the Letter of
Credit with respect to which any Revolving Lender has paid the Agent for the
account of the Issuing Lender for such Revolving Lender's participation in the
Letter of Credit pursuant to Section 3.03 or (ii) in payment of interest
thereon, the Agent will pay to each Revolving Lender, in the same funds as those
received by the Agent for the account of the Issuing Lender, the amount of such
Revolving Lender's Pro Rata Share of such funds, and the Issuing Lender shall
receive the amount of the Pro Rata Share of such funds of any Revolving Lender
that did not so pay the Agent for the account of the Issuing Lender.
(b) If the Agent or the Issuing Lender is required at any time to return to
the Company, or to a trustee, receiver, liquidator, custodian, or any official
in any Insolvency Proceeding, any portion of the payments made by the Company to
the Agent for the account of the Issuing Lender pursuant to Section 3.04(a) in
reimbursement of a payment made under the Letter of Credit or interest or fee
thereon, each Revolving Lender shall, on demand of the Agent, forthwith return
to the Agent or the Issuing Lender the amount of its Pro Rata Share of any
amounts so returned by the Agent or the Issuing Lender plus interest thereon
from the date such demand is made to the date such amounts are returned by such
Revolving Lender to the Agent or the Issuing Lender, at a rate per annum equal
to the Federal Funds Rate in effect from time to time.
3.05 Role of the Issuing Lender.
(a) Each Lender and the Company agree that, in paying any drawing under
a Letter of Credit, the Issuing Lender shall not have any responsibility to
obtain any document (other than any documents expressly required by the Letter
of Credit) or to ascertain or inquire as to the validity or accuracy of any such
document or the authority of the Person executing or delivering any such
document.
(b) No Agent-Related Person nor any of the respective correspondents,
participants or assignees of the Issuing Lender shall be liable to any Lender
for: (i) any action taken or omitted in connection herewith at the request or
with the approval of the Lenders or the Majority Lenders, as applicable; (ii)
any action taken or omitted in the absence of gross negligence or willful
misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any L/C-Related Document.
(c) The Company hereby assumes all risks of the acts or omissions of any
beneficiary or transferee with respect to its use of any Letter of Credit;
provided, however, that this assumption is not intended to, and shall not,
preclude the Company's pursuing such rights and remedies as it may have against
the beneficiary or transferee at law or under any other agreement. No
Agent-Related Person, nor any of the respective correspondents, participants or
assignees of the Issuing Lender, shall be liable or responsible for any of the
matters described in clauses (i) through (vii) of Section 3.06; provided,
however, anything in such clauses to the contrary notwithstanding, that the
Company may have a claim against the Issuing Lender, and the Issuing Lender may
be liable to the Company, to the extent, but only to the extent, of any direct,
as opposed to consequential or exemplary, damages suffered by the Company which
the Company proves were caused by the Issuing Lender's willful misconduct or
gross negligence or the Issuing Lender's willful failure to pay under any Letter
of Credit after the presentation to it by the beneficiary of a document strictly
complying with the terms and conditions of a Letter of Credit. In furtherance
and not in limitation of the foregoing: (i) the Issuing Lender may accept
documents that appear on their face to be in order, without responsibility for
further investigation, regardless of any notice or information to the contrary;
and (ii) the Issuing Lender shall not be responsible for the validity or
sufficiency of any instrument transferring or assigning or purporting to
transfer or assign a Letter of Credit or the rights or benefits thereunder or
proceeds thereof, in whole or in part, which may prove to be invalid or
ineffective for any reason.
3.06 Obligations Absolute. The obligations of the Company under this
Agreement and any L/C-Related Document to reimburse the Issuing Lender for a
drawing under a Letter of Credit, and to repay any L/C Borrowing and any drawing
under a Letter of Credit converted into Revolving Loans, shall be unconditional
and irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement and each such other L/C-Related Document under all circumstances,
including the following:
(i) any lack of validity or enforceability of this Agreement or any
L/C-Related Document;
(ii) any change in the time, manner or place of payment of, or in any other
term of, all or any of the obligations of the Company in respect of any Letter
of Credit or any other amendment or waiver of or any consent to departure from
all or any of the L/C-Related Documents;
(iii) the existence of any claim, recoupment, set-off, defense or other
right that the Company may have at any time against any beneficiary or any
transferee of any Letter of Credit (or any Person for whom any such beneficiary
or any such transferee may be acting), the Issuing Lender or any other Person,
whether in connection with this Agreement, the transactions contemplated hereby
or by the L/C-Related Documents or any unrelated transaction;
(iv) any draft, demand, certificate or other document presented under any
Letter of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any respect;
or any loss or delay in the transmission or otherwise of any document required
in order to make a drawing under any Letter of Credit;
(v) any payment by the Issuing Lender under any Letter of Credit against
presentation of a document that does not strictly comply with the terms of any
Letter of Credit; or any payment made by the Issuing Lender under any Letter of
Credit to any Person purporting to be a trustee in bankruptcy,
debtor-in-possession, assignee for the benefit of creditors, liquidator,
receiver or other representative of or successor to any beneficiary or any
transferee of any Letter of Credit, including any arising in connection with any
Insolvency Proceeding;
(vi) any exchange, release or non-perfection of any collateral, or any
release or amendment or waiver of or consent to departure from any other
guarantee, for all or any of the obligations of the Company in respect of any
Letter of Credit; or
(vii) any other circumstance or happening whatsoever, whether or not similar
to any of the foregoing, including any other circumstance that might otherwise
constitute a defense available to, or a discharge of, the Company or a
guarantor.
Notwithstanding the foregoing, neither the Company nor the Lenders (other than
the Issuing Lender in its capacity as such) shall be liable for any obligation
resulting from the gross negligence or willful misconduct of the Issuing Lender
with respect to any Letter of Credit.
3.07 Cash Collateral Pledge. Upon (i) the request of the Agent or the
Majority Lenders, (A) if the Issuing Lender has honored any full or partial
drawing request on any Letter of Credit and such drawing has resulted in an L/C
Borrowing hereunder at a time when any Event of Default has occurred and is
continuing, or (B) if, as of the Termination Date, any Letters of Credit may for
any reason remain outstanding and partially or wholly undrawn, or (ii) the
occurrence of the circumstances described in Sections 2.07(b) and (c) requiring
the Company to Cash Collateralize Letters of Credit, then, the Company shall
immediately Cash Collateralize the L/C Obligations in an amount equal to such
L/C Obligations.
3.08 Letter of Credit Fees.
(a) The Company shall pay to the Agent for the account of each of the
Revolving Lenders a letter of credit fee with respect to the Letters of Credit
equal to a per annum rate equal to 2.75% of the average daily maximum amount
available to be drawn of the outstanding Letters of Credit, computed on a
monthly basis in arrears on the last Business Day of each calendar month based
upon Letters of Credit outstanding for such month as calculated by the Agent;
provided, however, that during the existence of any Event of Default, such fee
shall accrue and be payable by the Company upon demand by the Agent (or upon
request by Majority Lenders) at a rate of 4.75%. Such letter of credit fees
shall be due and payable monthly in arrears on the last Business Day of each
calendar month during which Letters of Credit are outstanding, commencing on the
first such monthly date to occur after the Closing Date, through the Termination
Date (or such later date upon which the outstanding Letters of Credit shall
expire), with the final payment to be made on the Termination Date (or such
later expiration date).
(b) The Company shall pay to the Issuing Lender a letter of credit fronting
fee for each Letter of Credit Issued by the Issuing Lender equal to .125% per
annum of the face amount (or increased or decreased face amount, as the case may
be) of such Letter of Credit. Such Letter of Credit fronting fee shall be due
and payable monthly in arrears on the last Business Day of each calendar month
during which such Letter of Credit is outstanding, commencing on the first such
monthly date to occur after such Letter of Credit is issued, through the
Termination Date (or such later date upon which such Letter of Credit shall
expire), with the final payment to be made on the Termination Date (or such
later expiration date).
(c) The Company shall pay to the Issuing Lender from time to time on demand
the normal issuance, presentation, amendment and other processing fees, and
other standard costs and charges, of the Issuing Lender relating to letters of
credit as from time to time in effect.
3.09 Uniform Customs and Practice. The Uniform Customs and Practice
for Documentary Credits as published by the International Chamber of Commerce
most recently at the time of issuance of any Letter of Credit shall (unless
otherwise expressly provided in the Letters of Credit) apply to the Letters of
Credit.
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY
4.01 Taxes.
(a) Any and all payments by the Company, Mexican Borrower or Canadian
Borrower to each Lender or the Agent under this Agreement and any other Loan
Document shall be made free and clear of, and without deduction or withholding
for, any Taxes. In addition, the Company, Mexican Borrower or Canadian
Borrower, as the case may be, shall pay all Further Taxes and Other Taxes.
(b) If the Company, Mexican Borrower or Canadian Borrower shall be required
by law to deduct or withhold any Taxes, Other Taxes or Further Taxes from or in
respect of any sum payable hereunder to any Lender or the Agent, then:
(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), such
Lender or the Agent, as the case may be, receives and retains an amount equal to
the sum it would have received and retained had no such deductions or
withholdings been made;
(ii) the Company, Mexican Borrower or Canadian Borrower, as the case may be,
shall make such deductions and withholdings;
(iii) the Company, Mexican Borrower or Canadian Borrower, as the case may
be, shall pay the full amount deducted or withheld to the relevant taxing
authority or other authority in accordance with applicable law; and
(iv) the Company, Mexican Borrower or Canadian Borrower, as the case may be,
shall also pay to each Lender or the Agent for the account of such Lender, at
the time interest is paid, Further Taxes in the amount that the respective
Lender specifies as necessary to preserve the after-tax yield the Lender would
have received if such Taxes, Other Taxes or Further Taxes had not been imposed.
(c) The Company agrees to indemnify and hold harmless each Lender and
the Agent for the full amount of Taxes, Other Taxes, and Further Taxes in the
amount that the respective Lender specifies as necessary to preserve the
after-tax yield the Lender would have received if such Taxes, Other Taxes or
Further Taxes had not been imposed, and any liability (including penalties,
interest, additions to tax and expenses) arising therefrom or with respect
thereto, whether or not such Taxes, Other Taxes or Further Taxes were correctly
or legally asserted. Payment under this indemnification shall be made within 30
days after the date the Lender or the Agent makes written demand therefor.
(d) Within 30 days after the date of any payment pursuant to this Section by
the Company of Taxes, Other Taxes or Further Taxes, the Company, Mexican
Borrower or Canadian Borrower, as the case may be, shall furnish to each Lender
or the Agent the original or a certified copy of a receipt evidencing payment
thereof, or other evidence of payment satisfactory to such Lender or the Agent.
(e) If the Company, Mexican Borrower or Canadian Borrower, as the case may
be, is required to pay any amount to any Lender or the Agent pursuant to clauses
(b) or (c) of this Section (other than withholding tax on interest imposed by
the governments of Mexico or Canada), then such Lender shall use reasonable
efforts (consistent with legal and regulatory restrictions) to change the
jurisdiction of its Lending Office so as to eliminate any such additional
payment by the Company or Mexican Borrower or Canadian Borrower which may
thereafter accrue, if such change in the sole judgment of such Lender is not
otherwise disadvantageous to such Lender.
(f) Notwithstanding anything else to the contrary contained in this
Agreement, none of the Company, Mexican Borrower or Canadian Borrower shall be
required to pay any amount to any Lender or the Agent pursuant to clause (b) or
(c) of this Section on account of (i) withholding tax imposed by Mexico on
interest payments made to the Agent or any U.S. Lender to the extent that such
Taxes are imposed because the relevant U.S. Lender is not a bank or insurance
company within the meaning of Article 11(2)(a)(i) of the income tax treaty
between the United States and Mexico; (ii) withholding tax imposed by Mexico on
interest payments made to the Agent or any non-U.S. Lender to the extent that
such Taxes are imposed because the relevant non-U.S. Lender (A) does not qualify
for the benefits (including interest and limitation on benefits provisions) of
an effective income tax treaty for the avoidance of double tax between its
country of residence and Mexico, (B) is not duly registered as a foreign
financial institution with the Mexico Ministry of Finance and Public Credit, or
(C) will not be duly registered as a foreign financial institution with the
Mexican Ministry of Finance and Public Credit prior to the first interest
payment date; or (iii) withholding tax imposed by Canada on interest payments
made to the Agent or any Lender to the extent that such Taxes are imposed
because the Agent or such Lender does not qualify for the benefits (including
interest and limitation on benefits provisions) of an effective income tax
treaty for the avoidance of double tax between its country of residence and
Canada.
4.02 Increased Costs and Reduction of Return.
(a) If any Lender determines that, due to either (i) the introduction
of or any change in or in the interpretation of any law or regulation or (ii)
the compliance by that Lender with any guideline or request from any central
bank or other Governmental Authority (whether or not having the force of law),
there shall be any increase in the cost to such Lender of maintaining its
Commitment or participating in Letters of Credit, or, in the case of the Issuing
Lender, any increase in the cost to the Issuing Lender of agreeing to issue,
issuing or maintaining any Letter of Credit or of agreeing to make or making,
funding or maintaining any unpaid drawing under any Letter of Credit, then the
Company shall be liable for, and shall from time to time, upon demand (with a
copy of such demand to be sent to the Agent), pay to the Agent for the account
of such Lender, additional amounts as are sufficient to compensate such Lender
for such increased costs.
(b) If any Lender shall have determined that (i) the introduction of any
Capital Adequacy Regulation, (ii) any change in any Capital Adequacy Regulation,
(iii) any change in the interpretation or administration of any Capital Adequacy
Regulation by any central bank or other Governmental Authority charged with the
interpretation or administration thereof, or (iv) compliance by the Lender (or
its Lending Office) or any corporation controlling the Lender with any Capital
Adequacy Regulation, affects or would affect the amount of capital required or
expected to be maintained by the Lender or any corporation controlling the
Lender and (taking into consideration such Lender's or such corporation's
policies with respect to capital adequacy and such Lender's desired return on
capital) determines that the amount of such capital is increased as a
consequence of its Commitment, loans, credits or obligations under this
Agreement, then, upon demand of such Lender to any Borrower through the Agent,
such Borrower shall pay to the Lender, from time to time as specified by the
Lender, additional amounts sufficient to compensate the Lender for such
increase.
4.03 Certificates of Lenders. Any Lender claiming reimbursement or
compensation under this Article IV shall deliver to the applicable Borrower
(with a copy to the Agent) a certificate setting forth in reasonable detail the
amount payable to the Lender hereunder and such certificate shall be presumed
correct and binding on the applicable Borrower in the absence of manifest error.
4.04 Survival. The agreements and obligations of each Borrower in this
Article IV shall survive the payment of all other Obligations.
ARTICLE V
CONDITIONS PRECEDENT
5.01 Conditions of Initial Credit Extensions. The effectiveness of the
amendment and restatement of the Existing Credit Agreement pursuant to the terms
hereof, the effectiveness of the Lenders' waiver of Existing Defaults pursuant
to Section 1.06 hereof, and the obligation of each Lender to make its initial
Credit Extension hereunder, are subject to the condition that the Agent shall
have received on or before the Closing Date the documents described in
paragraphs (a) through (f), (h), (i) and (m) below, in form and substance
satisfactory to the Agent and, to the extent specified below, each Lender (and
in sufficient copies for each Lender), and in addition, the conditions set forth
in paragraphs (g) and (j) through (l) shall have been fulfilled in a manner
satisfactory to the Agent:
(a) Credit Agreement and Notes. This Agreement and the Notes shall
have been duly authorized, executed and delivered by each party thereto;
(b) Subsidiary Guaranty. Each Subsidiary Guarantor shall have duly
authorized, executed and delivered the Subsidiary Guaranty;
(c) Warrant Documents. The Warrant Documents shall have been duly
authorized, executed and delivered by each party thereto.
(d) Resolutions; Incumbency.
(i) copies of the resolutions of the board of directors of each Credit
Party authorizing the transactions contemplated hereby, certified by the
Secretary or an Assistant Secretary of such Person; and
(ii) a certificate of the Secretary or Assistant Secretary of each Credit
Party certifying the names and true signatures of the officers of such Credit
Party authorized to execute, deliver and perform, as applicable, this Agreement
and all other Loan Documents to be delivered by it hereunder;
(e) Organization Documents; Good Standing. Each of the following
documents:
(i) copies of the articles or certificate of incorporation and bylaws
of each Credit Party (or the equivalent, in the case of the Subsidiary
Borrowers) as then in effect, certified by the Secretary or Assistant Secretary
of such Person; and
(ii) a good standing certificate for each Credit Party from the Secretary of
State (or similar, applicable Governmental Authority) of its state of
incorporation and each state where such Person is qualified to do business as a
foreign corporation as of a recent date, together with, to the extent requested
by Agent, a bring-down certificate by facsimile;
(f) Legal Opinions. An opinion addressed to the Agent, the Collateral
Agent and the Lenders (i) of X'Xxxxxx & Xxxxxx LLC, special counsel to the
Company, substantially in the form of Exhibit C, and (ii) of Xxxx Xxxxxx,
General Counsel to the Company substantially in the form of Exhibit C-1.
(g) Payment of Fees. Evidence of payment by the Company of all accrued and
unpaid fees, costs and expenses to the extent then due and payable on the
Closing Date, together with Attorney Costs of B of A and each Lender to the
extent invoiced prior to or on the Closing Date, plus such additional amounts of
Attorney Costs as shall constitute B of A's reasonable estimate of Attorney
Costs incurred or to be incurred by it through the closing proceedings (provided
that such estimate shall not thereafter preclude final settling of accounts
between the Company and B of A); including any such costs, fees and expenses
arising under or referenced in Sections 2.10 and 11.04;
(h) Certificate. A certificate signed by a Responsible Officer of each
Borrower, dated as of the Closing Date, stating that:
(i) the representations and warranties contained in Article VI
(including the representation set forth in Section 6.16) are true and correct on
and as of such date, as though made on and as of such date;
(ii) no Default or Event of Default exists or would result from the initial
Credit Extension on or following the Closing Date;
(iii) other than the occurrence of the Existing Defaults or as otherwise
disclosed in writing to the Agent on the Closing Date, there has not occurred
since December 31, 2000 any event or circumstance that has resulted or could
reasonably be expected to result in a Material Adverse Effect;
(iv) the ING Loan shall have been funded in full pursuant to the
terms of the ING Loan Agreement and without a waiver of any condition precedent
of the ING Loan Agreement;
(v) the Series C Preferred Agreement shall have been executed and
delivered by each of the parties named as signatories thereto;
(vi) the Company's Series B Preferred Stock has been exchanged for the
Company's Series B-1 Preferred Stock pursuant to the Series B Exchange
Agreement;
(vii) the Flow Sale shall have been consummated pursuant to the terms of the
Flow Sale Agreement and without a waiver of any condition precedent of the Flow
Sale Agreement, the Flow Sale Note shall have been issued and delivered to, and
indorsed to the order of, the Agent pursuant to the Collateral Documents; and
(viii) the Company has received not less than $16,100,000 in an aggregate
Net Proceeds (after deduction for only the fees, expenses and other amounts to
be paid on the Closing Date) with respect to the closing of Restructuring
Transactions, as detailed in the flow of funds memo attached to such
certificate.
(i) Collateral Documents. As of the Closing Date, the Collateral
Documents, executed by the applicable Credit Party, in appropriate form for
recording, where necessary, together with:
(i) acknowledgment copies of all UCC-l financing statements filed,
registered or recorded to perfect the security interests of the Collateral Agent
for the benefit of the Lenders, or other evidence satisfactory to the Agent that
there has been or will be filed, registered or recorded all financing statements
and other filings, registrations and recordings necessary and advisable to
perfect the Liens of the Collateral Agent for the benefit of the Lenders in
accordance with applicable law;
(ii) written advice relating to such Lien and judgment searches as the
Collateral Agent shall have requested of the Company, and such termination
statements or other documents as may be necessary to confirm that the Collateral
is subject to no other Liens in favor of any Persons (other than Permitted
Liens);
(iii) all certificates and instruments representing the Pledged Collateral,
stock transfer powers executed in blank as the Collateral Agent or the Lenders
may specify;
(iv) evidence that all other actions necessary or, in the opinion of the
Collateral Agent or the Lenders, desirable to perfect and protect the first
priority security interest created by the Collateral Documents have been taken;
(v) funds sufficient to pay any filing or recording tax or fee in connection
with any and all UCC-1 financing statements;
(vi) evidence that the Collateral Agent has been named as loss payee under
all policies of casualty insurance, and as additional insured under all policies
of liability insurance;
(vii) such consents, estoppels, subordination agreements and other documents
and instruments executed by landlords, tenants and other Persons party to
material contracts relating to any Collateral as to which the Agent shall be
granted a Lien for the benefit of the Lenders, as requested by the Agent or any
Lender; and
(viii) evidence that all other actions necessary or, in the opinion of the
Collateral Agent or the Lenders, desirable to perfect and protect the first
priority Lien created by the Collateral Documents, and to enhance the Collateral
Agent's ability to preserve and protect its interests in and access to the
Collateral, have been taken;
(j) Restructuring Transactions. Evidence that each of the
Restructuring Transactions have been consummated pursuant to the terms of the
Restructuring Documents without waiver of any condition precedent in such
Restructuring Documents, and the Agent shall have received (i) for application
to the outstanding principal balance of the Revolving Loan, $15,500,000 in
immediately available funds and (ii) pursuant to the Pledge Agreement executed
by the Company, the originally-executed Flow Sale Note, indorsed to the order of
the Collateral Agent in a manner acceptable to the Collateral Agent and (iii)
evidence satisfactory to the Agent that the Company has received not less than
$16,1000,000 of aggregate Net Proceeds (after deduction for only the fees,
expenses and other amounts to be paid on the Closing Date) with respect to the
closing of the Restructuring Transactions;
(k) ING Intercreditor Agreement. The ING Funds shall have executed and
delivered the ING Intercreditor Agreement.
(l) Subordinated Debt Consent Solicitation. The Company shall have
commenced material actions and good faith reasonable efforts to commence the
SubDebt Consent Solicitation.
(m) Litigation. The absence of any action, suit, investigation or
proceeding pending or threatened in any court or before any arbitrator or
Governmental Authority that, if determined adversely to the Company or any
Subsidiary, could reasonably be expected to have a Material Adverse Effect or
which relates to this Agreement or any of the Restructuring Transactions;
(n) Other Documents. Such other approvals, opinions, documents or materials
as are described in the List of Closing Documents attached hereto as Exhibit D
or as the Agent or any Lender may otherwise reasonably request (except to the
extent specified in such exhibit as to be delivered at a later date).
5.02 Conditions to All Credit Extensions. The obligation of each
Lender to make any Loan to be made by it (including its initial Loan on or after
the Closing Date), and the obligation of the Issuing Lender to Issue any Letter
of Credit (including the initial Letter of Credit on or after the Closing Date),
is subject to the satisfaction of the following conditions precedent on the
relevant Borrowing Date or Issuance Date:
(a) Notice, Application. The Agent shall have received (with, in the
case of the initial Loans on or after the Closing Date only, a copy for each
Lender) or, in the case of Canadian Revolving Loan borrowings, the Agent and the
Canadian Revolving Lender shall have received a Notice of Borrowing or, in the
case of any Issuance of any Letter of Credit, the Issuing Lender and the Agent
shall have received an L/C Application or L/C Amendment Application as required
under Section 3.02;
(b) Continued Accuracy of Representations and Warranties. The
representations and warranties contained in Article VI shall be true and correct
on and as of such Borrowing Date or Issuance Date with the same effect as if
made on and as of such Borrowing Date or Issuance Date;
(c) No Existing Default. No Default or Event of Default shall exist or
shall result from such Borrowing, continuation or conversion or Issuance; and
(d) No Future Advance Notice. Neither the Agent nor any Lender shall have
received from any Credit Party or other Person any notice that any Collateral
Document will no longer secure on a first priority basis future advances or
future Loans to be made or extended under this Agreement.
Each Notice of Borrowing L/C Application or L/C Amendment Application submitted
by a Borrower hereunder shall constitute a representation and warranty by all
Borrowers hereunder, as of the date of each such notice and as of each Borrowing
Date or Issuance Date, as applicable, that the conditions set forth in this
Section 5.02 are satisfied.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Company and each Subsidiary Borrower (with respect to itself and its
Subsidiaries) represents and warrants to the Agent and each Lender that:
6.01 Corporate Existence and Power. The Company and each of its
Subsidiaries:
(a) is an entity duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals to own its assets, carry on its business
and to execute, deliver, and perform its obligations under the Loan Documents;
(c) is duly qualified as a foreign corporation and is licensed and in good
standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such qualification
or license; and
(d) is in compliance with all Requirements of Law; except, in each case
referred to in clause (c) or clause (d), to the extent that the failure to do so
could not reasonably be expected to have a Material Adverse Effect.
6.02 Corporate Authorization; No Contravention. The execution,
delivery and performance by such Credit Party of this Agreement and each other
Restructuring Document to which such Person is party, have been duly authorized
by all necessary corporate action, and do not and will not:
(a) contravene the terms of any of such Person's Organization
Documents;
(b) conflict with or result in any breach or contravention of, or the
creation of any Lien under, any document evidencing any Contractual Obligation
to which such Person is a party or any order, injunction, writ or decree of any
Governmental Authority to which such Person or its property is subject; or
(c) violate any Requirement of Law.
6.03 Governmental Authorization. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority (except for recordings or filings in connection with the
Liens granted to the Collateral Agent under the Collateral Documents) is
necessary or required in connection with the execution, delivery or performance
by, or enforcement against, any Credit Party of the Agreement or any other Loan
Document.
6.04 Binding Effect. This Agreement and each other Loan Document to which
any Credit Party is a party constitute the legal, valid and binding obligations
of such Credit Party, enforceable against such Person in accordance with their
respective terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, or similar laws affecting the enforcement of creditors'
rights generally or by equitable principles relating to enforceability.
6.05 Litigation. There are no actions, suits, proceedings, claims or
disputes pending, or to the best knowledge of any Borrower, threatened or
contemplated, at law, in equity, in arbitration or before any Governmental
Authority, against the Company, any of its Subsidiaries or any of their
respective properties which: (a) purport to affect or pertain to this
Agreement or any other Restructuring Document, or any of the transactions
contemplated hereby or thereby; or (b) if determined adversely to the Company or
any of its Subsidiaries, would reasonably be expected to have a Material Adverse
Effect. No injunction, writ, temporary restraining order or any order of any
nature has been issued by any court or other Governmental Authority purporting
to enjoin or restrain the execution, delivery or performance of this Agreement
or any other Restructuring Document, or directing that the transactions provided
for herein or therein not be consummated as herein or therein provided.
6.06 No Default. No Default or Event of Default exists or would result from
the incurring of any Obligations by any Credit Party or from the grant or
perfection of the Liens of the Collateral Agent and the Lenders on the
Collateral. As of the Closing Date, neither the Company nor any Subsidiary is
in default under or with respect to any Contractual Obligation in any respect
which, individually or together with all such defaults, could reasonably be
expected to have a Material Adverse Effect, or that would, if such default had
occurred after the Closing Date, create an Event of Default under Section
9.01(e). Except as described in Schedule 6.06, as of the Closing Date and
immediately prior to the effectiveness of this Agreement, no "Default" or "Event
of Default" shall have occurred and be continuing under and as defined in the
Existing Credit Agreement.
6.07 ERISA Compliance.
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law. Each
Plan which is intended to qualify under Section 401(a) of the Code has received
a favorable determination letter from the IRS and to the best knowledge of the
Company, nothing has occurred which would cause the loss of such qualification.
The Company and each ERISA Affiliate has made all required contributions to any
Plan subject to Section 412 of the Code, and no application for a funding waiver
or an extension of any amortization period pursuant to Section 412 of the Code
has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of the Company,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan which has resulted or could reasonably be expected to
result in a Material Adverse Effect. There has been no prohibited transaction
or violation of the fiduciary responsibility rules with respect to any Plan
which has resulted or could reasonably be expected to result in a Material
Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to occur; (ii)
no Pension Plan has any Unfunded Pension Liability; (iii) neither the Company
nor any ERISA Affiliate has incurred, or reasonably expects to incur, any
liability to the PBGC under Title IV of ERISA with respect to any Pension Plan
(other than premiums due and not delinquent under Section 4007 of ERISA); (iv)
neither the Company nor any ERISA Affiliate has incurred, or reasonably expects
to incur, any liability (and no event has occurred which, with the giving of
notice under Section 4219 of ERISA, would result in such liability) under
Section 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (v)
neither the Company nor any ERISA Affiliate has engaged in a transaction that
could be subject to Section 4069 or 4212(c) of ERISA.
6.08 Use of Proceeds; Margin Regulations. The proceeds of the Loans
are to be used solely for the purposes set forth in and permitted by Section
7.12 and Section 8.07. Neither the Company nor any Subsidiary is generally
engaged in the business of purchasing or selling Margin Stock or extending
credit for the purpose of purchasing or carrying Margin Stock. No part of the
proceeds of any Loan will be used to purchase or carry any margin stock (as
defined in Regulation U of the Board), directly or indirectly, or to extend
credit for the purpose of purchasing or carrying any such margin stock for the
purpose of reducing or retiring any indebtedness which was originally incurred
to purchase or carry any margin security or for any other purpose which might
cause any of the loans or extensions of credit under this Agreement to be
considered a "purpose credit" within the meaning of Regulation T, U or X of the
Board.
6.09 Title to Properties. The Company and each Subsidiary have good record
and marketable title or its equivalent in fee simple to, or valid leasehold
interests in, all real property necessary or used in the ordinary conduct of
their respective businesses, except for such defects in title as could not,
individually or in the aggregate, have a Material Adverse Effect. As of the
Closing Date, the property of the Company and its Subsidiaries is subject to no
Liens, other than Permitted Liens.
6.10 Taxes. The Company and each Subsidiary have filed all Federal and
other material tax returns and reports required to be filed, and have paid all
Federal and other material taxes, assessments, fees and other governmental
charges levied or imposed upon them or their properties, income or assets
otherwise due and payable, except those which have been extended or are being
contested in good faith by appropriate proceedings and for which adequate
reserves have been provided in accordance with GAAP. There is no proposed tax
assessment against the Company or any Subsidiary that would, if made, have a
Material Adverse Effect.
6.11 Financial Condition.
(a) The (x) audited annual consolidated financial statements of the
Company and its Subsidiaries dated December 31, 2000 and (y) the unaudited
monthly consolidated financial statements of the Company and its Subsidiaries
dated February 28, 2001:
(i) were prepared in accordance with GAAP consistently applied
throughout the period covered thereby, except as otherwise expressly noted
therein (subject to ordinary, good faith year-end audit adjustments);
(ii) fairly present the financial condition of the Company and its
consolidated Subsidiaries, and the Company and its consolidated Subsidiaries,
respectively, as of the date thereof and the respective results of operations
for the period covered thereby; and
(iii) except as specifically disclosed in Schedule 6.11(a), show all
material indebtedness and other liabilities, direct or contingent, of the
Company and its consolidated Subsidiaries, as of the date thereof, including
liabilities for taxes, material commitments and Contingent Obligations.
(b) The Company's consolidated unaudited pro forma 13-week rolling cash
flow forecast, and its consolidated quarterly projected income statements,
balance sheets (including inventory levels by operating division), Loan
outstandings, accounts receivable and accounts payable agings, in each case
through December 31, 2002 (collectively, the "Projections"), are attached hereto
as Schedule 6.11(b) and are based upon the Company's reasonable good faith
estimates and assumptions regarding the Company's and its Subsidiaries' future
financial performance and future market conditions, in each case after giving
effect to each of the Restructuring Transactions and the refinancing of the ING
Loan with the proceeds of the Company's issuance of its Series C Preferred Stock
on or prior to July 15, 2001.
(c) Since December 31, 2000, there has been no Material Adverse Effect,
other than the occurrence of the Existing Defaults or as otherwise disclosed in
writing to the Agent on the Closing Date.
6.12 Environmental Matters. Except as specifically disclosed in
Schedule 6.12:
(a) The on-going operations of the Company and each of its Subsidiaries
comply in all respects with all Environmental Laws, except such non-compliance
which would not (if enforced in accordance with applicable law) result in
liability in excess of $3,000,000 in the aggregate.
(b) The Company and each of its Subsidiaries have obtained all material
licenses, permits, authorizations and registrations required under any
Environmental Law ("Environmental Permits") and necessary for their respective
ordinary course operations, all such Environmental Permits are in good standing,
and the Company and each of its Subsidiaries are in compliance with all material
terms and conditions of such Environmental Permits.
(c) None of the Company, any of its Subsidiaries or any of their respective
present Property or operations, is subject to any outstanding written order from
or agreement with any Governmental Authority, nor subject to any judicial or
docketed administrative proceeding, respecting any Environmental Law,
Environmental Claim or Hazardous Material.
(d) There are no Hazardous Materials or other conditions or circumstances
existing with respect to any Property, or arising from operations prior to the
Closing Date, of the Company or any of its Subsidiaries that would reasonably be
expected to give rise to Environmental Claims with a potential liability of the
Company and its Subsidiaries in excess of $3,000,000 in the aggregate for all
such conditions, circumstances and Properties. In addition, (i) neither the
Company nor any of its Subsidiaries has any underground storage tanks (x) that
are not properly registered or permitted under applicable Environmental Laws, or
(y) that are leaking or disposing of Hazardous Materials off-site, and (ii) the
Company and its Subsidiaries have notified all of their employees of the
existence, if any, of any health hazard arising from the conditions of their
employment and have met all notification requirements under Title III of CERCLA
and all other Environmental Laws.
6.13 Collateral Documents.
(a) The provisions of each of the Collateral Documents are effective to
create in favor of the Collateral Agent for the benefit of the Lenders, a legal,
valid and enforceable first priority (subject to Permitted Liens) security
interest in all right, title and interest of the applicable Credit Party in the
collateral described therein; and financing statements have been delivered to
the Collateral Agent on the Closing Date to be filed in the offices in all of
the jurisdictions listed in the schedules to the Security Agreements, and each
Intellectual Property Assignment has been delivered to the Collateral Agent on
the Closing Date to be filed in the U.S. Patent and Trademark Office and the
U.S. Copyright Office. Except for title vehicles, vessels and other Collateral
which may not be perfected through the filing of financing statements under the
Uniform Commercial Code and except for equipment and inventory located on the
premises of a third party with a value of (as to the Company and its
Subsidiaries as a whole) less than $25,000 individually or $100,000 in the
aggregate (or as otherwise consented to by the Agent), all such security
interests have been or, upon the filing of the financing statements delivered on
the Closing Date, will be fully perfected security interests, except for
Permitted Liens.
(b) The provisions of each Pledge Agreement are effective to create, in
favor of the Collateral Agent for the benefit of the Lenders, a legal, valid and
enforceable security interest in all of the collateral described therein; and
the Pledged Collateral was delivered to the Collateral Agent or its nominee in
accordance with the terms thereof. The Lien of each Pledge Agreement
constitutes a perfected, first priority security interest in all right, title
and interest of the Company or such Subsidiary, as the case may be, in the
Collateral described therein, prior and superior to all other Liens and
interests except for Permitted Liens.
(c) All representations and warranties of each Credit Party contained in the
Collateral Documents are true and correct.
6.14 Regulated Entities. Neither the Company nor any Subsidiary is an
Investment Company" within the meaning of the Investment Company Act of 1940.
Neither the Company nor any Subsidiary is subject to regulation under the Public
Utility Holding Company Act of 1935, the Federal Power Act, the Interstate
Commerce Act, any state public utilities code, or any other Federal or state
statute or regulation limiting its ability to incur Indebtedness.
6.15 No Burdensome Restrictions. Neither the Company nor any Subsidiary is
a party to or bound by any Contractual Obligation, or subject to any restriction
in any Organization Document, or any Requirement of Law, which could reasonably
be expected to have a Material Adverse Effect.
6.16 Solvency. Each Credit Party is Solvent.
6.17 Labor Relations. There are no strikes, lockouts or other labor
disputes against the Company, any of its Subsidiaries, or, to the best of any
Borrower's knowledge, threatened against or affecting the Company, or any of its
Subsidiaries, and no significant unfair labor practice complaint is pending
against the Company, or any of its Subsidiaries or, to the best knowledge of any
Borrower, threatened against any of them before any Governmental Authority.
6.18 Copyrights, Patents, Trademarks and Licenses, etc. The Company or its
Subsidiaries own or are licensed or otherwise have the right to use all of the
patents, trademarks, service marks, trade names, copyrights, contractual
franchises, authorizations and other rights that are reasonably necessary for
the operation of their respective businesses, without conflict with the rights
of any other Person. To the best knowledge of the Company, no slogan or other
advertising device, product, process, method, substance, part or other material
now employed, or now contemplated to be employed, by the Company or any
Subsidiary infringes upon any rights held by any other Person. No claim or
litigation regarding any of the foregoing is pending or threatened, and no
patent, invention, device, application, principle or any statute, law, rule,
regulation, standard or code is pending or, to the knowledge of the Company,
proposed, which, in either case, could reasonably be expected to have a Material
Adverse Effect.
6.19 Subsidiaries. As of the Closing Date, the Company has no Subsidiaries
other than those specifically disclosed in part (a) of Schedule 6.19 hereto and
neither the Company nor any Subsidiary has any equity investments in any other
corporation or entity other than those specifically disclosed in part (b) of
Schedule 6.19.
6.20 Insurance. The properties of the Company and its Subsidiaries are
insured with financially sound and reputable insurance companies not Affiliates
of the Company, in such amounts, with such deductibles and covering such risks
as are customarily carried by companies engaged in similar businesses and owning
similar properties in localities where the Company or such Subsidiary operates.
6.21 Swap Obligations. Neither the Company nor any of its Subsidiaries has
incurred any outstanding obligations under any Swap Contracts, other than
Permitted Swap Obligations. The Company has undertaken its own independent
assessment of its consolidated assets, liabilities and commitments and has
considered appropriate means of mitigating and managing risks associated with
such matters and has not relied on any swap counterparty or any Affiliate of any
swap counterparty in determining whether to enter into any Swap Contract.
6.22 Subordination Provisions. The subordination provisions contained in
all notes, debentures, agreements and other instruments entered into or issued
in respect of the Subordinated Debt are enforceable against the issuer of the
respective security and the holders thereof, and the Loans and all other
Obligations entitled to the benefits of any Loan Document are within the
definitions of "Senior Indebtedness," or other comparable definition, included
in such provisions.
6.23 Broker's Fees. Except as set forth in this Agreement, neither the
Company nor any of its Subsidiaries has any obligation to any Person in respect
of any finder's, broker's or investment banker's fee in connection with the
transactions contemplated hereby (other than the Flow Sale).
6.24 Restructuring Documents. The Company has delivered to the Agent true,
complete and correct copies of each of the Restructuring Documents (including
all schedules, exhibits, annexes, amendments, supplements, modifications and all
other documents delivered pursuant thereto or in connection therewith). The
Restructuring Documents as originally executed and delivered by the parties
thereto have not been amended, waived, supplemented or modified without the
consent of the Agent. The representations and warranties of the parties set
forth therein are true and correct in all material respects as of the date
thereof. On the date of this Agreement, neither the Company nor any other party
to any of the Restructuring Documents is in default in the performance of or
compliance with any provisions under the Restructuring Documents. Subject to
the satisfaction of all of the conditions set forth in Section 5.01, the
Restructuring Transactions (other than the amendment and restatement of the
Existing Credit Agreement) have been consummated as of the Closing Date in
accordance with applicable laws and regulations.
6.25 Full Disclosure. None of the representations or warranties made
by the Company or any Subsidiary in the Loan Documents as of the date such
representations and warranties are made or deemed made, and none of the
statements contained in any exhibit, report, statement or certificate furnished
by or on behalf of the Company or any Subsidiary in connection with the Loan
Documents, contains any untrue statement of a material fact or omits any
material fact required to be stated therein or necessary to make the statements
made therein (taken as a whole), in light of the circumstances under which they
are made, not misleading as of the time when made or delivered.
ARTICLE VII
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, unless the Majority Lenders waive compliance in
writing:
7.01 Financial Statements. The Company shall deliver to the Agent, in
form and detail satisfactory to the Agent and the Majority Lenders, with
sufficient copies for the Agent and each Lender:
(a) as soon as available, but not later than 90 days after the end of
each fiscal year, a copy of the audited consolidated and consolidating balance
sheet of the Company and its Subsidiaries as at the end of such year and the
related consolidated and consolidating statements of operations, shareholders'
equity and cash flows for such year, setting forth in each case in comparative
form the figures for the previous fiscal year, and accompanied by the opinion of
Xxxxxx Xxxxxxxx LLP or another nationally-recognized independent public
accounting firm ("Independent Auditor") which report shall state that such
consolidated financial statements present fairly the financial position for the
periods indicated in conformity with GAAP applied on a basis consistent with
prior years. Except in the case of such opinion with respect to the Company's
financial statements for its fiscal year 2000 which has been qualified as to the
Company's ability to operate as a going concern, no such opinion shall be
qualified or limited because of a restricted or limited examination by the
Independent Auditor of any material portion of the Company's or any Subsidiary's
records; and
(b) as soon as available, but not later than 45 days after the end of each
of the first three Fiscal Quarters of each fiscal year, a copy of the unaudited
consolidated and consolidating balance sheet of the Company and its Subsidiaries
as of the end of such quarter and the related consolidated and consolidating
statements of operations, shareholders' equity and cash flows for the period
commencing on the first day and ending on the last day of such quarter, and
certified by a Responsible Officer as fairly presenting, in accordance with GAAP
(subject to ordinary, good faith year-end audit adjustments), the financial
position and the results of operations of the Company and its Subsidiaries.
(c) as soon as available, but not later than 30 days after the end of each
fiscal month (or in the case of the last month of a Fiscal Quarter, not later
than 45 days after the end of such month), a copy of the unaudited consolidated
balance sheet (including divisional inventory levels) of the Company and its
Subsidiaries as of the end of such month and the related consolidated income
statement and statement of cash flows for the period commencing on the first day
and ending on the last day of such month, and certified by a Responsible Officer
as fairly presenting, accordance with GAAP (subject to ordinary, good faith
year-end audit adjustments), the financial position and the results of
operations of the Company and its Subsidiaries.
7.02 Certificates; Other Information. The Company shall furnish to the
Agent, with sufficient copies for each Lender:
(a) concurrently with the delivery of the financial statements referred
to in Section 7.01(a), a certificate of the Independent Auditor stating that in
making the examination necessary therefor no knowledge was obtained of any
Default or Event of Default, except as specified in such certificate;
(b) concurrently with the delivery of the financial statements referred to
in Sections 7.01(a), (b) and (c), a Compliance Certificate executed by a
Responsible Officer;
(c) promptly, copies of all financial statements and reports that the
Company sends to its shareholders, and copies of all financial statements and
regular, periodical or special reports (including Forms 10K, 10Q and 8K) that
the Company or any Subsidiary may make to, or file with, the SEC;
(d) as soon as available, but in any event not later than the 30th day after
the end of each fiscal year, a copy of the plan and forecast (including a
projected consolidated and consolidating balance sheet, statement of operations
and cash flow statement) of the Company and its Subsidiaries for the next fiscal
year;
(e) within 30 days after each anniversary of the Closing Date and on or
before each renewal date thereafter, new insurance certificates satisfying the
requirements of Section 5.01(i)(vi);
(f) concurrently with delivery of the financial statements
referred to in Section 7.01(c), (i) a schedule of accounts receivable and
accounts payable agings as of the end of the applicable month, both on a
consolidated and divisional basis, prepared in a manner consistent with the
Projections, (ii) a 13-week cash flow forecast for the 13-week period commencing
as of the first day following the applicable month prepared in a manner
consistent with the Projections and (iii) a reconciliation of actual cash flows
against the prior month's cash flow forecast; and
(g) promptly, such additional information regarding the business,
financial or corporate affairs of the Company or any Subsidiary as the Agent, at
the request of any Lender, may from time to time request.
7.03 Notices. The Company or any Subsidiary Borrower shall promptly
notify the Agent and each Lender:
(a) of the occurrence of any Default or Event of Default;
(b) of any matter that has resulted or may reasonably be expected to result
in a Material Adverse Effect, including (i) breach or non-performance of, or any
default under, a material Contractual Obligation of the Company, Mexican
Borrower, Canadian Borrower or any other Subsidiary; (ii) any dispute,
litigation, investigation, proceeding or suspension involving the Company,
Mexican Borrower, Canadian Borrower or any other Subsidiary and any Governmental
Authority; (iii) the commencement of, or any material development in, any
litigation or proceeding affecting the Company or any Subsidiary, including
pursuant to any applicable Environmental Laws; or (iv) any other Environmental
Claims;
(c) of the occurrence of any of the following events affecting the Company
or any ERISA Affiliate (but in no event more than 10 days after such event), and
deliver to the Agent and each Lender a copy of any notice with respect to such
event that is filed with a Governmental Authority and any notice delivered by a
Governmental Authority to the Company or any ERISA Affiliate with respect to
such event:
(i) an ERISA Event;
(ii) a material increase in the Unfunded Pension Liability of any Pension
Plan;
(iii) the adoption of, or the commencement of contributions to, any Plan
subject to Section 412 of the Code by the Company or any ERISA Affiliate; or
(iv) the adoption of any amendment to a Plan subject to Section 412 of the
Code, if such amendment results in a material increase in contributions or
Unfunded Pension Liability.
(d) of any material change in accounting policies or financial
reporting practices by the Company or any of its consolidated Subsidiaries;
(e) upon, but in no event later than 15 days after, any officer of the
Company or any Subsidiary becoming aware of (i) any and all enforcement,
investigation, cleanup, removal or other governmental or regulatory actions
instituted, completed or threatened against the Company or any Subsidiary or any
of their respective properties pursuant to any applicable Environmental Laws
which could reasonably be expected to have a Material Adverse Effect, (ii) all
other material Environmental Claims, and (iii) any environmental or similar
condition on any real property adjoining or in the vicinity of the property of
the Company or any Subsidiary that could reasonably be anticipated to cause such
property of the Company or such Subsidiary or any part thereof to be subject to
any material restrictions on the ownership, occupancy, transferability or use of
such property under any Environmental Laws;
(f) upon the request from time to time of the Agent, the Swap Termination
Values, together with a description of the method by which such values were
determined, relating to any then-outstanding Swap Contracts to which the Company
or any of its Subsidiaries is party; and
(g) upon its delivery to, or receipt from, the trustee or any noteholder
under the Subordinated Debt Indenture, any notice or certificate with respect to
the Company's compliance, noncompliance, or any default, "Event of Default" (or
alleged noncompliance, default or "Event of Default") or any exercise or
threatened exercise of remedies under the Subordinated Debt Indenture (and the
Company shall concurrently with the delivery of such notice to the Agent and
each Lender, provide the Agent and each Lender with copies of such notice or
certificate).
Each notice under this Section shall be accompanied by a written statement by a
Responsible Officer setting forth details of the occurrence referred to therein,
and stating what action the Company or any affected Subsidiary proposes to take
with respect thereto and at what time. Each notice under Section 7.03(a) shall
describe with particularity any and all clauses or provisions of this Agreement
or other Loan Document that have been (or foreseeably will be) breached or
violated.
7.04 Preservation of Corporate Existence, Etc. The Company shall, and
shall cause each Subsidiary to:
(a) preserve and maintain in full force and effect its corporate
existence and good standing under the laws of its state or jurisdiction of
incorporation;
(b) preserve and maintain in full force and effect all governmental rights,
privileges, qualifications, permits, licenses and franchises necessary or
desirable in the normal conduct of its business, except in connection with
transactions permitted by Section 8.03 and sales of assets permitted by Section
8.02;
(c) use reasonable efforts, in the ordinary course of business, to preserve
its business organization and goodwill; and
(d) preserve or renew all of its registered patents, trademarks, trade names
and service marks, the non-preservation of which could reasonably be expected to
have a Material Adverse Effect.
7.05 Maintenance of Property. The Company shall maintain, and shall
cause each Subsidiary to maintain, and preserve all its property which is used
or useful in its business in good working order and condition, ordinary wear and
tear excepted and make all necessary repairs thereto and renewals and
replacements thereof.
7.06 Insurance. The Company shall maintain, and shall cause each Subsidiary
to maintain, with financially sound and reputable independent insurers,
insurance with respect to its properties and business against loss or damage of
the kinds customarily insured against by Persons engaged in the same or similar
business, of such types and in such amounts as are customarily carried under
similar circumstances by such other Persons; including workers' compensation
insurance, public liability and property and casualty insurance which amount
shall not be materially reduced by the Company in the absence of 30 days' prior
written notice to the Agent. If the Company fails to provide evidence of any of
the insurance coverage required in this section, the Agent may purchase
insurance at the Company's expense to protect the Agent's and the Lenders'
interest in the Collateral. Such insurance may, but need not, protect the
Company's or its Subsidiaries' interests. The coverage that the Agent purchases
may not pay any claim that the Company or any Subsidiary makes or any claim that
is made against the Company or any Subsidiary in connection with the Collateral.
The Company may later cancel any insurance purchased by the Agent, but only
after providing the Agent with evidence that the Company has obtained the
insurance as required in this section. If the Agent purchases insurance with
respect to the Collateral, the Company will be responsible for the costs of that
insurance, including interest and any other charges the Agent may impose in
connection with the placement of the insurance, until the effective date of the
cancellation or expiration of the insurance. The costs of the insurance may be
added to the existing balance of the Obligations and shall be reimbursed by the
Company upon demand therefor by the Agent. The costs of the insurance may be
more than the cost of the insurance the Company is able to obtain on its own.
In the event of a casualty loss, the net insurance proceeds from such insurance
policies shall be paid and applied as provided in Section 2.07(e). All casualty
insurance maintained by the Company shall name the Agent as loss payee and all
liability insurance shall name the Agent as additional insured for the benefit
of the Lenders, as their interests may appear. Upon request of the Agent or any
Lender, the Company shall furnish the Agent, with sufficient copies for each
Lender, at reasonable intervals (but not more than once per calendar year) a
certificate of a Responsible Officer of the Company (and, if requested by the
Agent, any insurance broker of the Company) setting forth the nature and extent
of all insurance maintained by the Company and its Subsidiaries in accordance
with this Section or any Collateral Documents (and which, in the case of a
certificate of a broker, were placed through such broker).
7.07 Payment of Obligations. The Company shall, and shall cause each
Subsidiary to, pay and discharge as the same shall become due and payable, all
their respective obligations and liabilities, including:
(a) all tax liabilities, assessments and governmental charges or levies
upon it or its properties or assets, unless the same are being contested in good
faith by appropriate proceedings and adequate reserves in accordance with GAAP
are being maintained by the Company or such Subsidiary;
(b) all lawful claims which, if unpaid, would by law become a Lien (other
than a Permitted Lien) upon its property; and
(c) all Indebtedness, as and when due and payable, but subject to any
subordination provisions contained in any instrument or agreement evidencing
such Indebtedness.
7.08 Compliance with Laws. The Company shall comply, and shall cause
and each other Subsidiary to comply, in all material respects with all
Requirements of Law of any Governmental Authority having jurisdiction over it or
its business (including the Federal Fair Labor Standards Act), except such as
may be contested in good faith or as to which a bona fide dispute may exist.
7.09 Compliance with ERISA. The Company shall, and shall cause each of its
ERISA Affiliates to: (a) maintain each Plan in compliance in all material
respects with the applicable provisions of ERISA, the Code and other federal or
state law; (b) cause each Plan which is qualified under Section 401(a) of the
Code to maintain such qualification unless such Plan is terminated; and (c) make
all required contributions to any Plan subject to Section 412 of the Code.
7.10 Inspection of Property and Books and Records. The Company shall
maintain and shall cause each Subsidiary to maintain proper books of record and
account, in which full, true and correct entries in conformity with GAAP
consistently applied shall be made of all financial transactions and matters
involving the assets and business of the Company and such Subsidiary. The
Company shall permit, and shall cause Mexican Borrower, Canadian Borrower and
each other Subsidiary to permit, representatives and independent contractors of
the Agent or any Lender to visit and inspect any of their respective properties,
to examine their respective corporate, financial and operating records, and make
copies thereof or abstracts therefrom, and to discuss their respective affairs,
finances and accounts with their respective directors, officers, and independent
public accountants, all at the expense of the Company and at such reasonable
times during normal business hours and as often as may be reasonably desired,
upon reasonable advance notice to the Company; provided, however, when an Event
of Default exists, the Agent or any Lender may do any of the foregoing at the
expense of the Company at any time during normal business hours and without
advance notice; provided, further, that neither the Agent nor any Lender shall
conduct any environmental testing of any owned or leased facility of the Company
or any Subsidiary without the prior written consent of the Company, which shall
not unreasonably be withheld.
7.11 Environmental Laws.
(a) The Company shall, and shall cause each Subsidiary to, conduct its
operations and keep and maintain its property in compliance with all
Environmental Laws, the violation of which could reasonably be expected to
result in liability to the Company and its Subsidiaries in excess of $500,000 in
the aggregate (net of any payments under insurance policies or indemnity
agreements which the Company or such Subsidiary reasonably expects to receive).
(b) Upon the written request of the Agent or any Lender, the Company shall
submit and cause each of its Subsidiaries to submit, to the Agent with
sufficient copies for each Lender, at the Company's sole cost and expense, at
reasonable intervals, a report providing an update of the status of any
environmental, health or safety compliance, hazard or liability issue identified
in any notice or report required pursuant to Section 7.03(e), that could,
individually or in the aggregate, result in liability in excess of $500,000 (net
of any payments under insurance policies or indemnity agreements which the
Company or such Subsidiary reasonably expects to receive).
7.12 Use of Proceeds. Each Borrower shall use the proceeds of the
Revolving Loans to provide funds for working capital and other general corporate
purposes, in each case not in contravention of any Requirement of Law or of any
Loan Document.
7.13 Solvency. The Company shall at all times be, and shall cause and each
of its Subsidiaries to be, Solvent.
7.14 Further Assurances.
(a) The Company shall ensure that all written information, exhibits and
reports furnished to the Agent or the Lenders do not and will not contain any
untrue statement of a material fact and do not and will not omit to state any
material fact or any fact necessary to make the statements contained therein not
misleading in light of the circumstances in which made, and will promptly
disclose to the Agent and the Lenders and correct any defect or error that may
be discovered therein or in any Loan Document or in the execution,
acknowledgment or recordation thereof.
(b) Promptly upon request by the Agent or the Majority Lenders, the Company
shall (and shall cause any of its Subsidiaries to) execute, acknowledge,
deliver, record, re-record, file, re-file, register and re-register, any and all
such further acts, deeds, conveyances, security agreements, mortgages,
assignments, estoppel certificates, financing statements and continuations
thereof, termination statements, notices of assignment, transfers, certificates,
assurances and other instruments the Agent or such Lenders, as the case may be,
may reasonably require from time to time in order (i) to carry out more
effectively the purposes of this Agreement or any other Loan Document, (ii) to
subject any of the properties, rights or interests covered by any of the
Collateral Documents to the Liens created by any of the Collateral Documents,
(iii) to perfect and maintain the validity, effectiveness and priority of any of
the Collateral Documents and the Liens intended to be created thereby, and (iv)
to better assure, convey, grant, assign, transfer, preserve, protect and confirm
to the Collateral Agent and Lenders the rights granted or now or hereafter
intended to be granted to the Collateral Agent and the Lenders under any Loan
Document or under any other document executed in connection therewith.
(c) Without limiting the generality of the other provisions of this section,
the Company shall deliver, or cause to be delivered, each of the items described
in Annex 5 of Exhibit D hereof on or before the due dates respectively set forth
therein.
7.15 Foreign Subsidiaries Security. If, following a change in the
relevant sections of the Code, the regulations and rules promulgated thereunder
and any rulings issued thereunder and at the request of the Agent or the
Majority Lenders, counsel for the Company acceptable to the Agent and the
Majority Lenders does not within 30 days after such request deliver evidence
satisfactory to the Agent with respect to any Foreign Subsidiary which is a
Wholly-Owned Subsidiary of the Company that (i) a pledge of 65% or more of the
total combined voting power of all classes of capital stock of such Foreign
Subsidiary entitled to vote, (ii) the entering into by such Foreign Subsidiary
of a guaranty in substantially the form of the Subsidiary Guaranty or (iii) the
entering into by such Foreign Subsidiary of a security agreement in
substantially the form of the Security Agreement, in either case would cause the
earnings of such Foreign Subsidiary to be treated as a deemed dividend to such
Foreign Subsidiary's United States parent or would otherwise violate a material
applicable law, then in the case of a failure to deliver the evidence described
in clause (i) above, that portion of such Foreign Subsidiary's outstanding
capital stock not theretofore pledged pursuant to the Pledge Agreement shall be
pledged to the Collateral Agent for the benefit of the Lenders pursuant to the
Pledge Agreement (or another pledge agreement in substantially similar form, if
needed), (ii) in the case of a failure to deliver the evidence described in
clause (ii) above, such Foreign Subsidiary shall execute and deliver a guaranty
of the Obligations of the Company under the Loan Documents, and (iii) in the
case of a failure to deliver the evidence described in clause (iii) above, such
Foreign Subsidiary shall execute and deliver a security agreement granting the
Collateral Agent for the benefit of the Lenders a security interest in all of
such Foreign Subsidiary's assets, in each case with all documents delivered
pursuant to this Section 7.15 to be in form and substance satisfactory to the
Agent and the Majority Lenders.
7.16 Bancomer Financing. The Company shall exert its good faith
reasonable efforts to close, as soon as practicable after the Closing Date, the
Bancomer Financing on the terms and conditions set forth in Schedule 1.01 and
otherwise on terms acceptable to the Majority Lenders.
7.17 Consultants. The Company shall continue to employ the services of
Development Specialists, Inc. (or another comparable consultant acceptable to
the Agent) in a manner and scope acceptable to the Agent.
7.18 SubDebt Consent Solicitation. The Company shall exert its good faith
reasonable efforts to commence and successfully complete the SubDebt Consent
Solicitation and to enter into with the trustee under the Subordinated Debt
Indenture a supplemental indenture substantially in the form of Exhibit E
hereto.
ARTICLE VIII
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any Loan or
other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, unless the Majority Lenders waive compliance in
writing:
8.01 Limitation on Liens. The Company shall not, and shall not suffer
or permit any Subsidiary to, directly or indirectly, make, create, incur, assume
or suffer to exist any Lien upon or with respect to any part of its property,
whether now owned or hereafter acquired, other than the following ("Permitted
Liens"):
(a) any Lien (other than a Lien on the Collateral) existing on property
of the Company or any Subsidiary on the Closing Date and set forth in Schedule
8.01 securing Indebtedness outstanding on such date;
(b) any Lien created under any Loan Document;
(c) Liens for taxes, fees, assessments or other governmental charges which
are not delinquent or remain payable without penalty, or to the extent that
non-payment thereof is permitted by Section 7.07, provided that no notice of
lien has been filed or recorded under the Code;
(d) carriers', warehousemen's, mechanics', landlords', materialmen's,
repairmen's or other similar Liens arising in the ordinary course of business
which are not delinquent or remain payable without penalty or which are being
contested in good faith and by appropriate proceedings, which proceedings have
the effect of preventing the forfeiture or sale of the property subject thereto;
(e) Liens (other than any Lien imposed by ERISA) consisting of pledges or
deposits required in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other social security legislation;
(f) Liens on the property of the Company or a Subsidiary securing (i) the
non-delinquent performance of bids, trade contracts (other than for borrowed
money), leases, statutory obligations, (ii) contingent obligations on surety and
appeal bonds, and (iii) other non-delinquent obligations of a like nature; in
each case, incurred in the ordinary course of business, provided all such Liens
in the aggregate would not (even if enforced) cause a Material Adverse Effect;
(g) Liens consisting of judgment or judicial attachment liens, provided that
the enforcement of such Liens is effectively stayed and all such liens in the
aggregate at any time outstanding for the Company and its Subsidiaries do not
exceed $500,000 (to the extent not covered by independent third-party insurance
as to which the insurer does not dispute coverage);
(h) easements, rights-of-way, restrictions and other similar encumbrances
incurred in the ordinary course of business which, in the aggregate, are not
substantial in amount, and which do not in any case materially detract from the
value of the property subject thereto or interfere with the ordinary conduct of
the businesses of the Company and its Subsidiaries;
(i) Liens (including Liens under Capital Leases) in respect of property or
assets acquired or constructed by the Company or a Subsidiary after the date
hereof, which Liens are created at the time of acquisition or completion of
construction of such property or asset or within 20 days thereafter, to secure
Indebtedness assumed or incurred to finance all or any part of the purchase
price or cost of construction of such property or asset, (ii) in the case of any
Person that hereafter becomes a Subsidiary or is consolidated with or merged
with or into Borrower or a Subsidiary, Liens existing at the time such Person
becomes a Subsidiary or is so consolidated or merged (and not incurred in
anticipation thereof), (iii) in the case of any property or asset acquired by
Borrower or any Subsidiary after the Closing Date, Liens existing on such
property or asset at the time of acquisition thereof (and not incurred in
anticipation thereof), whether or not the Indebtedness secured thereby is
assumed by Borrower or a Subsidiary; provided, that in any such case:
(x) no such Lien shall extend to or cover any other property or assets
of the Company or of such Subsidiary, as the case may be, and
(y) the aggregate principal amount of the Indebtedness secured by all such
Liens in respect of any such property or assets shall not exceed 100% of the
fair market value of such property or assets at the time of such acquisition or,
in the case of a Lien in respect of property or assets existing at the time of
such Person becoming a Subsidiary or being so consolidated or merged, the fair
market value of the property or assets acquired at such time and the amount of
Indebtedness of the Company and its Domestic Subsidiaries secured on the date of
issuance of such Liens shall not be less than 80% of the fair market value
unless the Agent shall have a perfected second lien on such equipment;
and any extension, renewal or replacement thereof but only if the principal
amount of the Indebtedness secured thereby is not increased and, such Liens do
not extend to or cover any other property or assets, provided further, that the
aggregate principal amount of Indebtedness secured by Liens permitted by this
Section 8.01(i) does not exceed, at any time outstanding, an amount equal to
$15,000,000 less the amount of Indebtedness outstanding and permitted under
Section 8.05(d);
(j) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of set-off or similar rights and
remedies as to deposit accounts or other funds maintained with a creditor
depository institution; provided that (i) such deposit account is not a
dedicated cash collateral account and is not subject to restrictions against
access by the Company in excess of those set forth by regulations promulgated by
the FRB, and (ii) such deposit account is not intended by the Company or any
Subsidiary to provide collateral to the depository institution; and
(k) Liens on property the subject of synthetic leases, tax retention
operating leases or other similar off-balance sheet financing arrangements which
secure Indebtedness permitted by Section 8.05(d);
(l) Liens securing Indebtedness incurred in connection with the Bancomer
Financing to the extent such Indebtedness is permitted pursuant to Section
8.05(i); and
(m) Liens securing Permitted Foreign Subsidiary Indebtedness; and
(n) Liens securing the Company's Indebtedness to the ING Funds under the ING
Loan Agreement and the Domestic Subsidiaries' Guaranty Obligations with respect
thereto, in each case subject to the ING Intercreditor Agreement.
8.02 Disposition of Assets. The Company shall not, and shall not
suffer or permit any Subsidiary to, directly or indirectly, sell, assign, lease,
convey, transfer or otherwise dispose of (whether in one or a series of
transactions) any property (including accounts and notes receivable, with or
without recourse) or enter into any agreement to do any of the foregoing,
except:
(a) sales of inventory in the ordinary course of the Company's and the
Subsidiaries' business (other than bulk sales of inventory or sales of scrap or
obsolete inventory);
(b) sales of obsolete equipment and scrap inventory for up to
$1,500,000 in gross consideration after the Closing Date;
(c) the Flow Sale; and
(d) the sale of the Company's and its Subsidiaries' interest in real
property and fixtures relating to their Melrose Park, Illinois facility,
provided that (i) the gross consideration for such sale shall not be less than
$3,150,000, (ii) the Net Proceeds thereof (after deduction for all closing
costs, expenses, commissions, fees, and for the payment in full in cash on all
of the obligations secured by the first mortgage encumbering such property and
held by Standard Car and Truck Company) shall not be less than an amount equal
to 90% of the aggregate gross consideration thereof, minus the outstanding
principal balance of such first mortgage obligations, and (iii) all of such Net
Proceeds (net of payment of such first mortgage obligations) shall have been
paid and applied in accordance with Section 2.07(e) hereof.
8.03 Consolidations and Mergers. The Company shall not, and shall not
suffer or permit any Subsidiary to, merge, consolidate with or into, or convey,
transfer, lease or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) to or in favor of any Person, except:
(a) any Domestic Subsidiary may merge with the Company, provided that
the Company shall be the continuing or surviving corporation, or with any one or
more Wholly-Owned Subsidiaries which is a Credit Party, provided that the
Wholly-Owned Domestic Subsidiary which is a Credit Party shall be the continuing
or surviving corporation;
(b) any Domestic Subsidiary may sell all or substantially all of its assets
(upon voluntary liquidation or otherwise), to the Company or another
Wholly-Owned Domestic Subsidiary which is a Credit Party;
(c) any Foreign Subsidiary may be merged with and into, or be dissolved or
liquidated into, or transfer any of its assets to, any Wholly-Owned Foreign
Subsidiary so long as in each case at least 65% of the total combined voting
power of all classes of capital stock of all first-tier Foreign Subsidiaries are
pledged pursuant to the Pledge Agreements; and
(d) the assets of any Foreign Subsidiary may be transferred to the Company
or any of its Wholly-Owned Domestic Subsidiaries which is a Credit Party, and
any Foreign Subsidiary may be merged with and into, or be dissolved or
liquidated into, the Company or any of its Wholly-Owned Domestic Subsidiaries
which is a Credit Party so long as the Company or such Wholly-Owned Domestic
Subsidiary is the surviving corporation of any such merger, dissolution or
liquidation.
8.04 Loans and Investments. The Company shall not purchase or acquire,
or suffer or permit any Subsidiary to purchase or acquire, or make any
commitment therefor, any capital stock, equity interest, or any obligations or
other securities of, or any interest in, any Person, or make or commit to make
any Acquisitions, or make or commit to make any advance, loan, extension of
credit or capital contribution to or any other investment in, any Person
including any Affiliate of the Company (together, "Investments"), except for:
(a) Investments existing on the date hereof and described on Schedule
8.04;
(b) Investments held by the Company or Subsidiary in the form of Cash
Equivalents;
(c) extensions of credit in the nature of accounts receivable or notes
receivable arising from the sale or lease of goods or services in the ordinary
course of business;
(d) extensions of credit by the Company or any Subsidiary to the Company or
any Subsidiary; provided, that (i) any such extension of credit by a Credit
Party shall be evidenced by a promissory note, in form and substance
satisfactory to the Agent, and such promissory note shall be delivered to the
Agent pursuant to the relevant Pledge Agreement, (ii) in the case of any loan or
advance to any Credit Party, unless subject to an effective pledge pursuant to
the immediately preceding clause, such loan or advance shall be subordinated to
the indefeasible payment in full of such Credit Party's obligations pursuant to
this Agreement and the other Loan Documents and (iii) the aggregate outstanding
principal balance of all extensions of credit to any Subsidiary which is not a
Credit Party shall not, at any time, exceed $1,000,000;
8.05 Limitation on Indebtedness. The Company shall not, and shall not
suffer or permit any Subsidiary to, create, incur, assume, suffer to exist, or
otherwise become or remain directly or indirectly liable with respect to, any
Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement;
(b) Indebtedness consisting of Contingent Obligations permitted pursuant to
Section 8.08;
(c) the Subordinated Debt and other Indebtedness existing on the Effective
Date and set forth in Schedule 8.05;
(d) Indebtedness consisting of synthetic leases, tax retention operating
leases or other similar off-balance sheet financing products entered into by the
Company or any Subsidiary in the ordinary course of business in an aggregate
amount not to exceed, at any time outstanding, an amount equal to (i)
$15,000,000, minus (ii) the amount of Indebtedness outstanding and permitted
under clause (e) of this section;
(e) Indebtedness secured by Liens permitted by Section 8.01(i) in an
aggregate principal amount not to exceed at any time outstanding, an amount
equal to (i) $15,000,000 and (ii) the amount of Indebtedness outstanding and
permitted under clause (d) of this section;
(f) Indebtedness of any Foreign Subsidiary pursuant to unsecured over-draft
lines or similar extensions of credit in an aggregate principal amount
outstanding for all Foreign Subsidiaries at any one time not to exceed
$5,000,000 ("Permitted Foreign Subsidiary Indebtedness");
(g) Intercompany Indebtedness to the extent any such loan is permitted to be
made by the lender under Section 8.04(d);
(h) Indebtedness consisting of the ING Loan and subject to the ING
Intercreditor Agreement in an aggregate outstanding principal amount not to
exceed $15,000,000, provided that such Indebtedness shall only be permitted
until July 15, 2001 and shall be repaid in full on or before such date with the
proceeds of the issuance and sale by the Company of the Series C Preferred Stock
pursuant to the Series C Preferred Agreement; and
(i) Indebtedness of the Mexican Borrower in connection with the Bancomer
Financing in an aggregate principal amount not to exceed $15,000,000 pursuant to
agreements and documents approved in writing by the Majority Lenders.
8.06 Transactions with Affiliates. The Company shall not, and shall
not suffer or permit any Subsidiary to, enter into any transaction with any
Affiliate of the Company, except upon fair and reasonable terms no less
favorable to the Company or such Subsidiary than would obtain in a comparable
arm's-length transaction with a Person not an Affiliate of the Company or such
Subsidiary.
8.07 Use of Proceeds. The Company shall not, and shall not suffer or
permit Mexican Borrower, Canadian Borrower or any other Subsidiary to, use any
portion of the Loan proceeds or any Letter of Credit, directly or indirectly,
(i) to purchase or carry Margin Stock, (ii) to repay or otherwise refinance
indebtedness of the Company or others incurred to purchase or carry Margin
Stock, (iii) to extend credit for the purpose of purchasing or carrying any
Margin Stock, or (iv) to acquire any security in any transaction that is subject
to Section 13 or 14 of the Exchange Act.
8.08 Contingent Obligations. The Company shall not, and shall not
suffer or permit any Subsidiary to, create, incur, assume or suffer to exist any
Contingent Obligations except:
(a) indorsements for collection or deposit in the ordinary course of
business;
(b) Permitted Swap Obligations;
(c) Contingent Obligations of the Company and its Subsidiaries existing as
of the Closing Date and listed in Schedule 8.08;
(d) Contingent Obligations of the Company with respect to Permitted Foreign
Subsidiary Indebtedness;
(e) Contingent Obligations of the Company arising under this Agreement;
(f) Contingent Obligations of the Company with respect to operating leases
entered into by a Subsidiary of the Company or with respect to the performance
of contractual obligations of a Subsidiary incurred in the ordinary course of
business; and
(g) Contingent Obligations constituting Indebtedness and expressly permitted
by Section 8.02.
8.09 Restricted Payments.
(a) The Company shall not, and shall not suffer or permit any
Subsidiary to, declare or make any dividend payment or other distribution of
assets, properties, cash, rights, obligations or securities on account of any
shares of any class of its capital stock (including, without limitation any
termination or break-up fees in connection with the Series C Preferred
Agreement), or purchase, redeem or otherwise acquire for value any shares of its
capital stock or any warrants, rights or options to acquire such shares, now or
hereafter outstanding, except that:
(i) the Company may declare and make dividend payments or other
distributions payable solely in its common stock;
(ii) the Company shall be permitted to (A) make, on the Closing Date, a
dividend in an amount not to exceed $1,139,841 with respect to its Series B
Preferred Stock pursuant to the terms of the Series B Exchange Agreement and (B)
exchange its Series B Preferred Stock for its Series B-1 Preferred Stock
pursuant to the Series B Exchange Agreement; and
(iii) any Wholly-Owned Subsidiary may declare and make dividend payments or
other distributions to the Company or a Wholly-Owned Subsidiary of the Company.
(b) The Company shall not, and shall not permit any Domestic Subsidiary
to, make (or give any notice in respect of) any voluntary or optional payment or
prepayment on, or redemption or acquisition for value of, any Indebtedness for
borrowed money incurred or permitted to exist under this Agreement, other than
Indebtedness evidenced by the Notes. Without limiting the generality of the
foregoing, the ING Loans may only be repaid (whether voluntarily or otherwise)
with the proceeds of the issuance and sale of the Company's Series C Preferred
Stock pursuant to the Series C Preferred Agreement and may not be otherwise
repaid (directly or by setoff), prepaid or repurchased nor shall any accrued
interest with respect thereto be paid in cash with respect thereto.
8.10 ERISA. The Company shall not, and shall not suffer or permit any
of its Subsidiaries to, (i) terminate any Plan subject to Title IV of ERISA so
as to result in any material (in the opinion of the Majority Lenders) liability
to the Company or any ERISA Affiliate, (ii) permit to exist any ERISA Event or
any other event or condition, which presents the risk of a material (in the
opinion of the Majority Lenders) liability to any member of the Controlled
Group, (iii) make a complete or partial withdrawal (within the meaning of ERISA
Section 4201) from any Multiemployer Plan so as to result in any material (in
the opinion of the Majority Lenders) liability to the Company or any ERISA
Affiliate or, (iv) enter into any new Plan or modify any existing Plan so as to
increase its obligations thereunder which could result in any material (in the
opinion of the Majority Lenders) liability to any member of the Controlled
Group.
8.11 Change in Business. The Company shall not, and shall not suffer or
permit any Subsidiary to, engage in any material line of business substantially
different from those lines of business carried on by the Company and its
Subsidiaries on the date hereof.
8.12 Accounting Changes. The Company shall not, and shall not suffer or
permit any Subsidiary to, make any significant change in accounting treatment or
reporting practices, except as required by GAAP, or change the fiscal year of
the Company or of any Subsidiary.
8.13 EBITDA. The Company shall not permit its EBITDA for any period set
forth below to be less than the amount set forth below opposite such period:
Period Amount
May 1, 2001 through
June 30, 2001 $2,250,000
May 1, 2001 through
September 30, 2001 $8,500,000
May 1, 2001 through
December 31, 2001 $16,000,000
May 1, 2001 through
March 31, 2002 $26,982,000
Four Fiscal Quarters
ending June 30, 200 $38,101,000
Four Fiscal Quarters
ending September 30, 2002 $46,240,000
Four Fiscal Quarters
ending December 31, 2002 $53,128,000.
8.14 Irregular Items. The Company shall not incur total Irregular
Items during any period set forth below in an amount in excess of the amount set
forth below in the first column opposite such period or incur cash or non-cash
Irregular Items during such periods in excess of the amounts respectively set
forth below in the second and third columns opposite such period:
Total Cash Non-Cash
Period Amount Amount AMount
Fiscal Quarter ending June 30, 2001
$15,000,000 $6,000,000 $ 9,000,000
Two Fiscal Quarters ending September 30, 2001
$15,000,000 $6,000,000 $ 9,000,000
Three Fiscal Quarters ending December 31, 2001
$15,000,000 $6,000,000 $ 9,000,000
Four Fiscal Quarters ending March 31, 2002
$17,000,000 $6,800,000 $ 10,200,000
Five Fiscal Quarters ending June 30, 2002
$19,000,000 $7,600,000 $ 11,400,000
Six Fiscal Quarters ending September 30, 2002
$21,000,000 $8,400,000 $ 12,600,000
Seven Fiscal Quarters ending December 31, 2002
$23,000,000 $9,200,000 $13,800,000.
Period Amount
Fiscal Quarter ending
June 30, 2001 $5,000,000
Two Fiscal Quarters ending
September 30, 2001 $10,000,000
Three Fiscal Quarters ending
December 31, 2001 $15,000,000
Four Fiscal Quarters ending
March 31, 2002 $17,000,000
Five Fiscal Quarters
ending June 30, 2002 $19,000,000
Six Fiscal Quarters
ending September 30, 2002 $21,000,000
Seven Fiscal Quarters
ending December 31, 2002 $23,000,000.
8.15 Collateral Coverage Ratio. The Company shall not permit its
Collateral Coverage Ratio as of the last day of any calendar month ending during
any period set forth below to be less than the ratio set forth below opposite
such period:
Period Ratio
April 1, 2001 through
June 30, 2001 1.24 to 1.00
July 1, 2001 through
March 31, 2002 1.19 to 1.00
April 1, 2002 through
September 30, 2002 1.21 to 1.00
October 1, 2002 and
all times thereafter 1.22 to 1.00.
8.16 Capital Expenditures. The Company and its consolidated
Subsidiaries shall not make or commit to make Capital Expenditures during either
period set forth below in an amount in excess of the amounts set forth below
opposite such periods:
Period Amount
April 1, 2001 through
December 31, 2001 $ 9,000,000
January 1, 2002 through
December 31, 2002 $12,000,000.
8.17 Subordinated Debt. Except pursuant to a supplemental indenture
substantially in the form of Exhibit E which would be entered into upon a
successful completion of the SubDebt Consent Solicitation, the Company will not
modify, supplement or amend the Subordinated Debt Indenture or any other
instrument entered into or issued in respect of the Subordinated Debt (other
than modifications which do not make any provisions thereof more burdensome or
onerous, and are not otherwise adverse, to the Company, any of its Subsidiaries,
or the Lenders).
8.18 Material Agreements. The Company will not modify, supplement or
amend any of the Restructuring Documents other than the Loan Documents (other
than modifications which do not make any provisions thereof more burdensome or
onerous, and are not otherwise adverse, to the Company, any of its Subsidiaries,
or the Lenders).
ARTICLE IX
EVENTS OF DEFAULT
9.01 Event of Default. Any of the following shall constitute an "Event
of Default":
(a) Non-Payment. Any Borrower fails to pay, (i) when and as required
to be paid herein, any amount of principal of any Loan or of any L/C Obligation,
or (ii) within five days after the same becomes due, any interest, fee or any
other amount payable hereunder or under any other Loan Document; or
(b) Representation or Warranty. Any representation or warranty by any
Credit Party made or deemed made herein, in any other Loan Document, or which is
contained in any certificate, document or financial or other statement by such
Credit Party, or any Responsible Officer, furnished at any time under this
Agreement, or in or under any other Loan Document, is incorrect in any material
respect on or as of the date made or deemed made; or
(c) Specific Defaults. Any Credit Party fails to perform or observe any
term, covenant or agreement contained in any of Sections 7.01, 7.02, 7.03, 7.09
or 7.14(c) or in Article VIII; or
(d) Other Defaults. Any Credit Party fails to perform or observe any other
term or covenant contained in this Agreement or any other Loan Document, and
such default shall continue unremedied for a period of 20 days after the earlier
of (i) the date upon which a Responsible Officer knew or reasonably should have
known of such failure or (ii) the date upon which written notice thereof is
given to the Company by the Agent or any Lender; or
(e) Cross-Default. (i) The Company or any Subsidiary (A) fails to make any
payment in respect of any Indebtedness (including, without limitation the
Subordinated Debt, and the ING Loan) or Contingent Obligation (other than in
respect of Swap Contracts), having an aggregate principal amount of more than
$500,000 when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) and such failure continues after the
applicable grace or notice period, if any, specified in the relevant document on
the date of such failure; or (B) fails to perform or observe any other condition
or covenant, or any other event shall occur or condition exist, under any
agreement or instrument relating to any such Indebtedness (other than the
Subordinated Debt) or Contingent Obligation, and such failure continues after
the applicable grace or notice period, if any, specified in the relevant
document on the date of such failure if the effect of such failure, event or
condition is to cause, or to permit the holder or holders of such Indebtedness
or beneficiary or beneficiaries of such Indebtedness (or a trustee or agent on
behalf of such holder or holders or beneficiary or beneficiaries) to cause such
Indebtedness to be declared to be due and payable prior to its stated maturity,
or such Contingent Obligation to become payable or cash collateral in respect
thereof to be demanded; or (C) at any time prior to the earlier of July 15, 2001
and a successful completion of the SubDebt Consent Solicitation and related
waiver and modification of the Subordinated Debt Indenture, fails to perform or
observe any other condition or covenant, or any other event shall occur or
condition exist, under the Subordinated Debt Indenture or any agreement or
instrument relating to the Subordinated Debt, such failure continues after the
applicable grace or notice period, if any, specified in therein, and the holder
or holders of such Subordinated Debt or the trustee under the Subordinated Debt
Indenture causes any such Subordinated Debt to be declared to be due and payable
prior to its stated maturity or takes any other actions to enforce its remedies
under the terms of the Subordinated Debt Indenture with respect to such failure
(other than the delivery of a notice of such failure by to the Company by such
trustee) or to commence a legal proceeding to enforce the Company's or any
Subsidiaries' obligations thereunder or to commence any action against the
Company or any Subsidiaries of the types described in Section 9.01(g); or (D) at
any time after the earlier of July 15, 2001 and a successful completion of the
SubDebt Consent Solicitation and related waiver and modification of the
Subordinated Debt Indenture, fails to perform or observe any other condition or
covenant, or any other event shall occur or condition exist, under the
Subordinated Debt Indenture or any agreement or instrument relating to the
Subordinated Debt, and such failure continues after the applicable grace or
notice period, if any, specified therein if the effect of such failure, event or
condition is to cause, or to permit the holder or holders of such Subordinated
Debt or the trustee under the Subordinated Debt Indenture to cause any
Subordinated Debt to be declared to be due and payable prior to its stated
maturity; or (E) fails to repay, in full, on or prior to July 15, 2001, the ING
Loan with the proceeds of the Company's issuance and sale of Series C Preferred
Stock pursuant to the terms and conditions of the Series C Preferred Agreement;
or (ii) there occurs under any Swap Contract an Early Termination Date (as
defined in such Swap Contract) resulting from (1) any event of default under
such Swap Contract as to which the Company or any Subsidiary is the Defaulting
Party (as defined in such Swap Contract) or (2) any Termination Event (as so
defined) as to which the Company or any Subsidiary is an Affected Party (as so
defined), and, in either event, the Swap Termination Value owed by the Company
or such Subsidiary as a result thereof is greater than $500,000; or
(f) Insolvency; Voluntary Proceedings. The Company or any of its
Subsidiaries (i) ceases or fails to be solvent, or generally fails to pay, or
admits in writing its inability to pay, its debts as they become due, subject to
applicable grace periods, if any, whether at stated maturity or otherwise; (ii)
voluntarily ceases to conduct its business in the ordinary course; (iii)
commences any Insolvency Proceeding with respect to itself; or (iv) takes any
action to effectuate or authorize any of the foregoing; or
(g) Involuntary Proceedings. (i) Any involuntary Insolvency Proceeding is
commenced or filed against the Company or any of its Subsidiaries, or any writ,
judgment, warrant of attachment, execution or similar process, is issued or
levied against a substantial part of the Company's or any of its Subsidiaries'
properties, and any such proceeding or petition shall not be dismissed, or such
writ, judgment, warrant of attachment, execution or similar process shall not be
released, vacated or fully bonded within 60 days after commencement, filing or
levy; (ii) the Company or any of its Subsidiaries admits the material
allegations of a petition against it in any Insolvency Proceeding, or an order
for relief (or similar order under non-U.S. law) is ordered in any Insolvency
Proceeding; or (iii) the Company or any of its Subsidiaries acquiesces in the
appointment of a receiver, trustee, custodian, conservator, liquidator,
mortgagee in possession (or agent therefor), or other similar Person for itself
or a substantial portion of its property or business; or
(h) ERISA. (i) An ERISA Event shall occur with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to result
in liability of the Company under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of $500,000;
(ii) the aggregate amount of Unfunded Pension Liability among all Pension Plans
at any time exceeds $500,000; or (iii) the Company or any ERISA Affiliate shall
fail to pay when due, after the expiration of any applicable grace period, any
installment payment with respect to its withdrawal liability under Section 4201
of ERISA under a Multiemployer Plan in an aggregate amount in excess of
$500,000; or
(i) Monetary Judgments. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against the
Company or any Subsidiary involving in the aggregate a liability (to the extent
not covered by independent third-party insurance as to which the insurer does
not dispute coverage) as to any single or related series of transactions,
incidents or conditions, of $500,000 or more, and the same shall remain
unsatisfied, unvacated and unstayed pending appeal for a period of 30 days after
the entry thereof; or
(j) Non-Monetary Judgments. Any non-monetary judgment, order or decree is
entered against the Company or any Subsidiary which does or would reasonably be
expected to have a Material Adverse Effect, and there shall be any period of 10
consecutive days during which a stay of enforcement of such judgment or order,
by reason of a pending appeal or otherwise, shall not be in effect; or
(k) Collateral; Intercreditor Issues.
(i) any provision of any Collateral Document shall for any reason cease
to be valid and binding on or enforceable against the applicable Credit Party or
any Credit Party shall so state in writing or bring an action to limit its
obligations or liabilities thereunder; or
(ii) any Collateral Document shall for any reason (other than pursuant to
the terms thereof or as a result of the failure of the Collateral Agent to file
appropriate continuation statements) cease to create a valid security interest
in the Collateral purported to be covered thereby or such security interest
shall for any reason cease to be a perfected and first priority security
interest in any material portion of such Collateral, subject only to Permitted
Liens; or
(iii) any ING Fund shall fail to comply with any of its obligations
under the ING Intercreditor Agreement; or any representation or warranty of any
ING Fund therein shall be incorrect in any material respect; or any provision
therein shall for any reason cease to be valid and binding on or enforceable
against any such party or any such party shall so state in writing or bring an
action to limit its obligations or liabilities thereunder; or
(l) Change of Control. There occurs any Change of Control; or
(m) Guarantor Defaults. Any Guarantor fails in any material respect to
perform or observe any term, covenant or agreement in the Guaranty or the
Guaranty is for any reason partially (including with respect to future advances)
or wholly revoked or invalidated, or otherwise ceases to be in full force and
effect, or any Guarantor or any other Person contests in any manner the validity
or enforceability thereof or denies that it has any further liability or
obligation thereunder; or any event described at clauses (f) or (g) of this
Section occurs with respect to such Guarantor; or
(n) Invalidity of Subordination Provisions. The subordination provisions of
the Subordinated Debt Indenture or of any other agreement or instrument
governing any Subordinated Debt is for any reason revoked or invalidated, or
otherwise cease to be in full force and effect, any Person contests in any
manner the validity or enforceability thereof or denies that it has any further
liability or obligation thereunder, or the Loans and the other Obligations
hereunder entitled to receive the benefits of any Loan Document is for any
reason subordinated or does not have the priority contemplated by this Agreement
or such subordination provisions.
9.02 Remedies. If any Event of Default occurs, the Agent shall, at the
request of, or may, with the consent of, the Majority Lenders:
(a) declare the commitment of each Lender to make Loans and any
obligation of the Issuing Lender to Issue Letters of Credit to be terminated,
whereupon such commitments and obligation shall be terminated;
(b) declare an amount equal to the maximum aggregate amount that is or at
any time thereafter may become available for drawing under any outstanding
Letters of Credit (whether or not any beneficiary shall have presented, or shall
be entitled at such time to present, the drafts or other documents required to
draw under such Letters of Credit) to be immediately due and payable, and
declare the unpaid principal amount of all outstanding Loans, all interest
accrued and unpaid thereon, and all other amounts owing or payable hereunder or
under any other Loan Document to be immediately due and payable, without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Company; and
(c) exercise on behalf of itself and the Lenders all rights and remedies
available to it and the Lenders under the Loan Documents or applicable law;
provided, however, that upon the occurrence of any event specified in Sections
9.01(f) or (g) (in the case of clause (i) of Section 9.01 (g) upon the
expiration of the 60-day period mentioned therein), the obligation of each
Lender to make Loans and any obligation of the Issuing Lender to Issue Letters
of Credit shall automatically terminate and the unpaid principal amount of all
outstanding Loans and all interest and other amounts as aforesaid shall
automatically become due and payable without further act of the Agent, the
Issuing Lender or any Lender.
9.03 Rights Not Exclusive. The rights provided for in this Agreement
and the other Loan Documents are cumulative and are not exclusive of any other
rights, powers, privileges or remedies provided by law or in equity, or under
any other instrument, document or agreement now existing or hereafter arising.
ARTICLE X
THE AGENT
10.01 Appointment and Authorization; "Agent".
(a) Each Lender hereby irrevocably (subject to Section 10.09) appoints,
designates and authorizes the Agent (including, without limitation, in its
capacity as Collateral Agent) to take such action on its behalf under the
provisions of this Agreement and each other Loan Document and to exercise such
powers and perform such duties as are expressly delegated to it by the terms of
this Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere in this Agreement or in any other Loan Document, the Agent
shall not have any duties or responsibilities, except those expressly set forth
herein, nor shall the Agent have or be deemed to have any fiduciary relationship
with any Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against the Agent. Without limiting the generality
of the foregoing sentence, the use of the term "agent" in this Agreement with
reference to the Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable law.
Instead, such term is used merely as a matter of market custom, and is intended
to create or reflect only an administrative relationship between independent
contracting parties.
(b) The Issuing Lender shall act on behalf of the Lenders with respect to
any Letters of Credit Issued by it and the documents associated therewith until
such time and except for so long as the Agent may agree at the request of the
Majority Lenders to act for such Issuing Lender with respect thereto; provided,
however, that the Issuing Lender shall have all of the benefits and immunities
(i) provided to the Agent in this Article X with respect to any acts taken or
omissions suffered by the Issuing Lender in connection with Letters of Credit
Issued by it or proposed to be Issued by it and the application and agreements
for letters of credit pertaining to the Letters of Credit as fully as if the
term "Agent", as used in this Article X, included the Issuing Lender with
respect to such acts or omissions, and (ii) as additionally provided in this
Agreement with respect to the Issuing Lender.
10.02 Delegation of Duties. The Agent may execute any of its duties
under this Agreement or any other Loan Document by or through agents, employees
or attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects with
reasonable care.
10.03 Liability of Agent. None of the Agent-Related Persons shall (i) be
liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct),
or (ii) be responsible in any manner to any of the Lenders for any recital,
statement, representation or warranty made by the Company or any Subsidiary or
Affiliate of the Company, or any officer thereof, contained in this Agreement or
in any other Loan Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by the Agent under or in
connection with, this Agreement or any other Loan Document, or for the value of
or title to any Collateral, or the validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document, or
for any failure of the Company or any other party to any Loan Document to
perform its obligations hereunder or thereunder. No Agent-Related Person shall
be under any obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books or records of the Company or any of the Company's Subsidiaries or
Affiliates.
10.04 Reliance by Agent.
(a) The Agent shall be entitled to rely, and shall be fully protected
in relying, upon any writing, resolution, notice, consent, certificate,
affidavit, letter, telegram, facsimile, telex or telephone message, statement or
other document or conversation believed by it to be 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 (including counsel to the Company), independent
accountants and other experts selected by the Agent. The Agent shall be fully
justified in failing or refusing to take any action under this Agreement or any
other Loan Document unless it shall first receive such advice or concurrence of
the Majority Lenders as it deems appropriate and, if it so requests, it shall
first be indemnified to its 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 Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement or any
other Loan Document in accordance with a request or consent of the Majority
Lenders and such request and any action taken or failure to act pursuant thereto
shall be binding upon all of the Lenders.
(b) For purposes of determining compliance with the conditions specified in
Section 5.01, each Lender that has executed this Agreement shall be deemed to
have consented to, approved or accepted or to be satisfied with, each document
or other matter either sent by the Agent to such Lender for consent, approval,
acceptance or satisfaction, or required thereunder to be consented to or
approved by or acceptable or satisfactory to the Lender.
10.05 Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default, except
with respect to defaults in the payment of principal, interest and fees required
to be paid to the Agent for the account of the Lenders, unless the Agent shall
have received written notice from a Lender or the Company referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default". The Agent will notify the Lenders of its
receipt of any such notice. The Agent shall take such action with respect to
such Default or Event of Default as may be requested by the Majority Lenders in
accordance with Article IX; provided, however, that unless and until the Agent
has received any such request, the Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable or in the best interest
of the Lenders.
10.06 Credit Decision. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by the Agent hereinafter taken, including any review of the affairs of the
Company and its Subsidiaries, shall be deemed to constitute any representation
or warranty by any Agent-Related Person to any Lender. Each Lender represents
to the Agent that it has, independently and without reliance upon any
Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Company and its Subsidiaries, the value or and title to
any Collateral, and all applicable bank regulatory laws relating to the
transactions contemplated hereby, and made its own decision to enter into this
Agreement and to extend credit to the Company and its Subsidiaries hereunder.
Each Lender also represents that it will, independently and without reliance
upon any Agent-Related Person and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigations as it deems necessary
to inform itself as to the business, prospects, operations, property, financial
and other condition and creditworthiness of the Company. Except for notices,
reports and other documents expressly herein required to be furnished to the
Lenders by the Agent, the Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the business,
prospects, operations, property, financial and other condition or
creditworthiness of the Company which may come into the possession of any of the
Agent-Related Persons.
10.07 Indemnification of Agent. Whether or not the transactions
contemplated hereby are consummated, the Lenders shall indemnify upon demand the
Agent-Related Persons (to the extent not reimbursed by or on behalf of the
Company and without limiting the obligation of the Company to do so), pro rata,
from and against any and all Indemnified Liabilities; provided, however, that no
Lender shall be liable for the payment to the Agent-Related Persons of any
portion of such Indemnified Liabilities resulting solely from such Person's
gross negligence or willful misconduct. Without limitation of the foregoing,
each Lender shall reimburse the Agent upon demand for its ratable share of any
reasonable costs or out-of-pocket expenses (including Attorney Costs) incurred
by the Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, any other Loan Document, or
any document contemplated by or referred to herein, to the extent that the Agent
is not reimbursed for such expenses by or on behalf of the Company. The
undertaking in this Section shall survive the payment of all Obligations
hereunder and the resignation or replacement of the Agent.
10.08 Agent in Individual Capacity. B of A and its Affiliates may make
loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with the Company and its
Subsidiaries and Affiliates as though B of A were not the Agent or the Issuing
Lender hereunder and without notice to or consent of the Lenders. The Lenders
acknowledge that, pursuant to such activities, B of A or its Affiliates may
receive information regarding the Company or its Affiliates (including
information that may be subject to confidentiality obligations in favor of the
Company or such Subsidiary) and acknowledge that the Agent shall be under no
obligation to provide such information to them. With respect to its Loans, B of
A shall have the same rights and powers under this Agreement as any other Lender
and may exercise the same as though it were not the Agent or the Issuing Lender.
10.09 Successor Agent. The Agent may, and at the request of the Majority
Lenders shall, resign as Agent upon 30 days' notice to the Lenders. If the
Agent resigns under this Agreement, the Majority Lenders shall appoint from
among the Lenders a successor agent for the Lenders subject, so long as no Event
of Default has occurred and is then continuing, to the consent of the Company
which shall not be unreasonably withheld or delayed. If no successor agent is
appointed prior to the effective date of the resignation of the Agent, the Agent
may appoint, after consulting with the Lenders and the Company, a successor
agent from among the Lenders. Upon the acceptance of its appointment as
successor agent hereunder, such successor agent shall succeed to all the rights,
powers and duties of the retiring Agent and the term "Agent" shall mean such
successor agent and the retiring Agent's appointment, powers and duties as Agent
shall be terminated. After any retiring Agent's resignation hereunder as Agent,
the provisions of this Article X and Sections 11.04 and 11.05 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under this Agreement. If no successor agent has accepted appointment as Agent
by the date which is 30 days following a retiring Agent's notice of resignation,
the retiring Agent's resignation shall nevertheless thereupon become effective
and the Lenders shall perform all of the duties of the Agent hereunder until
such time, if any, as the Majority Lenders appoint a successor agent as provided
for above. Notwithstanding the foregoing, however, B of A may not be removed as
the Agent at the request of the Majority Lenders unless B of A shall also
simultaneously be replaced as "Issuing Lender" hereunder pursuant to
documentation in form and substance reasonably satisfactory to B of A.
10.10 Withholding Tax
(a) If any Lender is a "foreign corporation, partnership or trust"
within the meaning of the Code and such Lender claims exemption from, or a
reduction of, U.S. withholding tax under Sections 1441 or 1442 of the Code, such
Lender agrees with and in favor of the Agent and to Company, to deliver to the
Agent and to Company:
(i) if such Lender claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, two properly completed and
executed copies of IRS Form W-8BEN before the payment of any interest in the
first calendar year and before the payment of any interest in each third
succeeding calendar year during which interest may be paid under this Agreement;
(ii) if such Lender claims that interest paid under this Agreement is exempt
from United States withholding tax because it is effectively connected with a
United States trade or business of such Lender, two properly completed and
executed copies of IRS Form W-8ECI before the payment of any interest is due in
the first taxable year of such Lender and in each succeeding taxable year of
such Lender during which interest may be paid under this Agreement; and
(iii) such other form or forms as may be required under the Code or other
laws of the United States as a condition to exemption from, or reduction of,
United States withholding tax.
Such Lender agrees to promptly notify the Agent and to Company of any change in
circumstances which would modify or render invalid any claimed exemption or
reduction.
(b) If any Lender claims exemption from, or reduction of, withholding
tax under a United States tax treaty by providing IRS Form W-8BEN and such
Lender sells, assigns, grants a participation in, or otherwise transfers all or
part of the Obligations of the Company to such Lender, such Lender agrees to
notify the Agent of the percentage amount in which it is no longer the
beneficial owner of Obligations of the Company to such Lender. To the extent of
such percentage amount, the Agent will treat such Lender's IRS Form W-8BEN as no
longer valid.
(c) If any Lender claiming exemption from United States withholding tax by
filing IRS Form W-8ECI with the Agent sells, assigns, grants a participation in,
or otherwise transfers all or part of the Obligations of the Company to such
Lender, such Lender agrees to undertake sole responsibility for complying with
the withholding tax requirements imposed by Sections 1441 and 1442 of the Code.
(d) If any Lender is entitled to a reduction in the applicable withholding
tax, the Agent may withhold from any interest payment to such Lender an amount
equivalent to the applicable withholding tax after taking into account such
reduction. However, if the forms or other documentation required by clause (a)
of this Section are not delivered to the Agent, then the Agent may withhold from
any interest payment to such Lender not providing such forms or other
documentation an amount equivalent to the applicable withholding tax imposed by
Sections 1441 and 1442 of the Code, without reduction.
(e) If the IRS or any other Governmental Authority of the United States or
other jurisdiction asserts a claim that the Agent did not properly withhold tax
from amounts paid to or for the account of any Lender (because the appropriate
form was not delivered or was not properly executed, or because such Lender
failed to notify the Agent of a change in circumstances which rendered the
exemption from, or reduction of, withholding tax ineffective, or for any other
reason) such Lender shall indemnify the Agent fully for all amounts paid,
directly or indirectly, by the Agent as tax or otherwise, including penalties
and interest, and including any taxes imposed by any jurisdiction on the amounts
payable to the Agent under this Section, together with all costs and expenses
(including Attorney Costs). The obligation of the Lenders under this Section
shall survive the payment of all Obligations and the resignation or replacement
of the Agent.
10.11 Collateral Matters
(a) The Collateral Agent is authorized on behalf of all the Lenders,
without the necessity of any notice to or further consent from the Lenders, from
time to time to take any action with respect to any Collateral or the Collateral
Documents which may be necessary to perfect and maintain perfected the security
interest in and Liens upon the Collateral granted pursuant to the Collateral
Documents.
(b) The Lenders irrevocably authorize the Collateral Agent, at its option
and in its discretion, to release any Lien granted to or held by the Collateral
Agent upon any Collateral (i) upon termination of the Commitments and payment in
full of all Loans and all other Obligations payable under this Agreement and
under any other Loan Document; (ii) constituting property sold or to be sold or
disposed of as part of or in connection with any asset disposition permitted
hereunder pursuant to Section 8.02; (iii) constituting property in which the
Company or any Subsidiary of the Borrower owned no interest at the time the Lien
was granted or at any time thereafter; (iv) constituting property leased to the
Company or any Subsidiary of the Company under a lease which has expired or been
terminated in a transaction permitted under this Agreement or is about to expire
and which has not been, and is not intended by the Company or such Subsidiary to
be, renewed or extended; (v) consisting of an instrument evidencing Indebtedness
or other debt instrument, if the Indebtedness evidenced thereby has been paid in
full; or (vi) if approved, authorized or ratified in writing by the Majority
Lenders or all the Lenders, as the case may be, as provided in Section 11.01
hereof. Upon request by the Collateral Agent at any time, the Lenders will
confirm in writing the Collateral Agent's authority to release particular types
or items of Collateral pursuant to this Section 10.11.
ARTICLE XI
MISCELLANEOUS
11.01 Amendments and Waivers. (a) No amendment or waiver of any
provision of this Agreement or any other Loan Document, and no consent with
respect to any departure by the Company or any applicable Subsidiary therefrom,
shall be effective unless the same shall be in writing and signed by the
Majority Lenders (or by the Agent at the written request of the Majority
Lenders) and the Company and acknowledged by the Agent, and then any such waiver
or consent shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no such waiver, amendment, or
consent shall, unless in writing and signed by all the Lenders and the Company
and acknowledged by the Agent, do any of the following:
(i) increase or extend the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 8.02) without the written consent of
such Lender;
(ii) postpone, delay or reduce any scheduled principal payment amount or
Scheduled Commitment Reduction under Section 2.08, postpone, delay or reduce any
mandatory principal payment or reduction in the Available Commitment required by
Section 2.07(e), or postpone or delay any date fixed by this Agreement or any
other Loan Document for any payment of interest, fees or reimbursement or
indemnity amounts due to any Lenders (or any of them) hereunder or under any
other Loan Document;
(iii) reduce the principal of, or the rate of interest specified herein on
any Loan, or (subject to clause (z) below) any fees or other amounts payable
hereunder or under any other Loan Document;
(iv) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Loans which is required for the Lenders or any of them
to take any action hereunder;
(v) discharge all or substantially all of the Guarantors, or release all or
substantially all of the Collateral, except as otherwise may be provided in the
Collateral Documents or except where the consent of the Majority Lenders only is
specifically provided for; or
(vi) amend this Section, or Section 2.14, or any provision herein providing
for consent or other action by all Lenders;
and, provided further, that (A) no amendment, waiver or consent shall, unless in
writing and signed by the Issuing Lender in addition to the Majority Lenders or
all the Lenders, as the case may be, affect the rights or duties of the Issuing
Lender under this Agreement or any L/C-Related Document relating to any Letter
of Credit Issued or to be Issued by it, (B) no amendment, waiver or consent
shall, unless in writing and signed by the Canadian Revolving Lender in addition
to the Majority Lenders or all the Lenders, as the case may be, affect the
rights or duties of the Canadian Revolving Lender under this Agreement or any
other Loan Document, and (C) no amendment, waiver or consent shall, unless in
writing and signed by the Agent in addition to the Majority Lenders or all the
Lenders, as the case may be, affect the rights or duties of the Agent under this
Agreement or any other Loan Document.
(b) Notwithstanding anything to the contrary set forth in this
Agreement, it is expressly agreed that , if with the Bancomer Financing occurs
and is permitted pursuant to Section 8.05(i), and provided that all obligations
of the Mexican Borrower shall have been repaid in full, the Collateral Agent may
effect a complete release of: (x) the Liens on Collateral of the Mexican
Borrower and each Mexican Subsidiary securing Obligations of the Mexican
Borrower; and (y) each Mexican Subsidiary from its Obligations under its
respective Guaranty without any further authorization from the Lenders; and
(ii) the Agent, the Canadian Revolving Lender and the Borrower may, in their
sole discretion, amend the provisions of Schedule 2.05 pertaining to the
Canadian Revolving Loans, so long as such amendment does not increase the amount
of the Canadian Subsidiary Loan Sublimit or otherwise adversely impact any other
Lender.
11.02 Notices.
(a) All notices, requests, consents, approvals, waivers and other
communications shall be in writing (including, unless the context expressly
otherwise provides, by facsimile transmission, provided that any matter
transmitted by facsimile (i) shall be immediately confirmed by a telephone call
to the recipient at the number specified on Schedule 11.02, and (ii) shall be
followed promptly by delivery of a hard copy original thereof) and mailed, faxed
or delivered, to the address or facsimile number specified for notices on
Schedule 11.02; or, as directed to the Company or the Agent, to such other
address as shall be designated by such party in a written notice to the other
parties, and as directed to any other party, at such other address as shall be
designated by such party in a written notice to the Company and the Agent.
(b) All such notices, requests and communications shall, when transmitted by
overnight delivery, or faxed, be effective when delivered for overnight
(next-day) delivery, or transmitted in legible form by facsimile machine,
respectively, or if mailed, upon the third Business Day after the date deposited
into the U.S. mail, or if delivered, upon delivery; except that notices pursuant
to Article II, III or X to the Agent shall not be effective until actually
received by the Agent, and notices pursuant to Article III to the Issuing Lender
shall not be effective until actually received by the Issuing Lender at the
address specified for the "Issuing Lender" on the applicable signature page
hereof.
(c) Any agreement of the Agent and the Lenders herein to receive certain
notices by telephone or facsimile is solely for the convenience and at the
request of the Company. The Agent and the Lenders shall be entitled to rely on
the authority of any Person purporting to be a Person authorized by the Company
to give such notice and the Agent and the Lenders shall not have any liability
to the Company or other Person on account of any action taken or not taken by
the Agent or the Lenders in reliance upon such telephonic or facsimile notice.
The obligation of the Company to repay the Loans and L/C Obligations shall not
be affected in any way or to any extent by any failure by the Agent and the
Lenders to receive written confirmation of any telephonic or facsimile notice or
the receipt by the Agent and the Lenders of a confirmation which is at variance
with the terms understood by the Agent and the Lenders to be contained in the
telephonic or facsimile notice.
11.03 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Agent or any Lender, any right, remedy,
power or privilege hereunder, shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege.
11.04 Costs and Expenses. The Company shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse B of A (including in its capacity as Agent and
Issuing Lender) within five Business Days after demand (subject to Section
5.01(f)) for all costs and expenses incurred by B of A (including in its
capacity as Agent and Issuing Lender) and each Lender in connection with the
development, preparation, delivery, syndication, administration and execution
of, and any amendment, supplement, waiver or modification to (in each case,
whether or not consummated), this Agreement, any Loan Document and any other
documents prepared in connection herewith or therewith, and the consummation of
the transactions contemplated hereby and thereby, including reasonable Attorney
Costs incurred by B of A (including in its capacity as Agent and Issuing Lender)
and each Lender with respect thereto;
(b) pay or reimburse the Agent and each Lender within five Business Days
after demand (subject to Section 5.01(f)) for all reasonable costs and expenses
(including Attorney Costs) incurred by them in connection with the enforcement,
attempted enforcement, or preservation of any rights or remedies under this
Agreement or any other Loan Document during the existence of an Event of Default
or after acceleration of the Loans (including in connection with any "workout"
or restructuring regarding the Loans, and including in any Insolvency Proceeding
or appellate proceeding); and
(c) pay or reimburse B of A (including in its capacity as Agent) within five
Business Days after demand for all reasonable appraisal (including the allocated
cost of internal appraisal services), audit, field exam, environmental
inspection and review (including the allocated cost of such internal services),
search and filing costs, fees and expenses, incurred or sustained by B of A
(including in its capacity as Agent) in connection with the matters referred to
under subsections (a) and (b) of this Section.
11.05 Company Indemnification. Whether or not the transactions
contemplated hereby are consummated, the Company shall indemnify, defend and
hold the Agent-Related Persons and each Lender and each of its respective
officers, directors, employees, counsel, agents and attorneys-in-fact (each, an
"Indemnified Person") harmless from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
charges, expenses and disbursements (including Attorney Costs) of any kind or
nature whatsoever which may at any time (including at any time following
repayment of the Loans, the termination of the Letters of Credit and the
termination, resignation or replacement of the Agent or replacement of any
Lender) be imposed on, incurred by or asserted against any such Person in any
way relating to or arising out of the Company entering into this Agreement or
any document contemplated by or referred to herein, or the transactions
contemplated hereby, or any action taken or omitted by any such Person under or
in connection with any of the foregoing, including with respect to any
investigation, litigation or proceeding (including any Insolvency Proceeding or
appellate proceeding) related to or arising out of this Agreement or the Loans
or Letters of Credit or the use of the proceeds thereof, whether or not any
Indemnified Person is a party thereto (all the foregoing, collectively, the
"Indemnified Liabilities"); provided, that the Company shall have no obligation
hereunder to any Indemnified Person with respect to Indemnified Liabilities
resulting solely from the gross negligence or willful misconduct of such
Indemnified Person. The agreements in this Section shall survive payment of all
other Obligations.
11.06 Payments Set Aside. To the extent that the Company makes a payment to
the Agent or the Lenders, or the Agent or the Lenders exercise their right of
set-off, and such payment or the proceeds of such set-off or any part thereof
are subsequently invalidated, declared to be fraudulent or preferential, set
aside or required (including pursuant to any settlement entered into by the
Agent or such Lender in its discretion) to be repaid to a trustee, receiver or
any other party, in connection with any Insolvency Proceeding or otherwise, then
(a) to the extent of such recovery the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such set-off had not occurred, and (b)
each Lender severally agrees to pay to the Agent upon demand its pro rata share
of any amount so recovered from or repaid by the Agent.
11.07 Successors and Assigns. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Company may not assign or transfer any
of its rights or obligations under this Agreement without the prior written
consent of the Agent and each Lender.
11.08 Assignments, Participations, etc.
(a) Any Lender may, with the written consent of the Agent, which
consent shall not be unreasonably withheld, at any time assign and delegate to
one or more Eligible Assignees (provided that no written consent of the Agent
shall be required in connection with any assignment and delegation by a Lender
to an Eligible Assignee that is an Affiliate of such Lender) (each an
"Assignee") all, or any ratable part of all, of the Loans, the Commitments, the
L/C Obligations and the other rights and obligations of such Lender hereunder,
in a minimum amount of $5,000,000 (or, if less, the entire amount of such
Lender's Loans, Commitment and L/C Obligations); provided, however, that the
Company and the Agent may continue to deal solely and directly with such Lender
in connection with the interest so assigned to an Assignee until (i) written
notice of such assignment, together with payment instructions, addresses and
related information with respect to the Assignee, shall have been given to the
Company and the Agent by such Lender and the Assignee; (ii) such Lender and its
Assignee shall have delivered to the Company and the Agent an Assignment and
Acceptance in the form of Exhibit F ("Assignment and Acceptance") together with
any Note or Notes subject to such assignment and (iii) the assignor Lender or
Assignee has paid to the Agent a processing fee in the amount of $3,500.
(b) From and after the date that the Agent notifies the assignor Lender that
it has received (and provided its consent with respect to) an executed
Assignment and Acceptance and payment of the above-referenced processing fee,
(i) the Assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, shall have the rights and obligations of a Lender
under the Loan Documents, and (ii) the assignor Lender shall, to the extent that
rights and obligations hereunder and under the other Loan Documents have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its rights
and be released from its obligations under the Loan Documents.
(c) Within five Business Days after its receipt of notice by the Agent that
it has received an executed Assignment and Acceptance and payment of the
processing fee, (and provided that it consents to such assignment in accordance
with Section 11.08(a)), the Company shall execute and deliver to the Agent, new
Notes evidencing such Assignee's assigned Loans and Commitment and, if the
assignor Lender has retained a portion of its Loans and its Commitment,
replacement Notes in the principal amount of the Loans retained by the assignor
Lender (such Notes to be in exchange for, but not in payment of, the Notes held
by such Lender). Immediately upon each Assignee's making its processing fee
payment under the Assignment and Acceptance, this Agreement shall be deemed to
be amended to the extent, but only to the extent, necessary to reflect the
addition of the Assignee and the resulting adjustment of the Commitments arising
therefrom. The Commitment allocated to each Assignee shall reduce such
Commitments of the assigning Lender pro tanto.
(d) Any Lender may at any time sell to one or more commercial lenders or
other Persons not Affiliates of the Company (a "Participant") participating
interests in any Loans, the Commitment of that Lender and the other interests of
that Lender (the "originating Lender") hereunder and under the other Loan
Documents; provided, however, that (i) the originating Lender's obligations
under this Agreement shall remain unchanged, (ii) the originating Lender shall
remain solely responsible for the performance of such obligations, (iii) the
Company, the Issuing Lender and the Agent shall continue to deal solely and
directly with the originating Lender in connection with the originating Lender's
rights and obligations under this Agreement and the other Loan Documents, and
(iv) no Lender shall transfer or grant any participating interest under which
the Participant has rights to approve any amendment to, or any consent or waiver
with respect to, this Agreement or any other Loan Document, except to the extent
such amendment, consent or waiver would require unanimous consent of the Lenders
as described in the first proviso to Section 11.01. In the case of any such
participation, the Participant shall not have any rights under this Agreement,
or any of the other Loan Documents, and all amounts payable by the Company
hereunder shall be determined as if such Lender had not sold such participation;
except that, if amounts outstanding under this Agreement are due and unpaid, or
shall have been declared or shall have become due and payable upon the
occurrence of an Event of Default, each Participant shall be deemed to have the
right of set-off in respect of its participating interest in amounts owing under
this Agreement to the same extent as if the amount of its participating interest
were owing directly to it as a Lender under this Agreement.
(e) Notwithstanding any other provision in this Agreement, any Lender may at
any time create a security interest in, or pledge, all or any portion of its
rights under and interest in this Agreement and the Note held by it in favor of
any Federal Reserve Bank in accordance with Regulation A of the FRB or U.S.
Treasury Regulation 31 CFR Sec.203.14, and such Federal Reserve Bank may enforce
such pledge or security interest in any manner permitted under applicable law.
11.09 Confidentiality. Each Lender agrees to take and to cause its
Affiliates to take normal and reasonable precautions and exercise due care to
maintain the confidentiality of all information identified as "confidential" or
"secret" by the Company and provided to it by the Company or any Subsidiary, or
by the Agent on the Company's or such Subsidiary's behalf, under this Agreement
or any other Loan Document, and neither it nor any of its Affiliates shall use
any such information other than in connection with or in enforcement of this
Agreement and the other Loan Documents or in connection with other business now
or hereafter existing or contemplated with the Company or any Subsidiary; except
to the extent such information (i) was or becomes generally available to the
public other than as a result of disclosure by the Lender, or (ii) was or
becomes available on a non-confidential basis from a source other than the
Company, provided that such source is not bound by a confidentiality agreement
with the Company known to the Lender; provided, however, that any Lender may
disclose such information (A) at the request or pursuant to any requirement of
any Governmental Authority to which the Lender is subject or in connection with
an examination of such Lender by any such authority; (B) pursuant to subpoena or
other court process, in which event, to the extent permitted by applicable laws,
such Lender agrees to use reasonable commercial efforts to promptly notify the
Company of its receipt of any such subpoena or other court process; (C) when
required to do so in accordance with the provisions of any applicable
Requirement of Law; (D) to the extent reasonably required in connection with any
litigation or proceeding to which the Agent, any Lender or their respective
Affiliates may be party; (E) to the extent reasonably required in connection
with the exercise of any remedy hereunder or under any other Loan Document; (F)
to such Lender's independent auditors and other professional advisors; (G) to
any Participant or Assignee, actual or potential, provided that such Person
agrees in writing to keep such information confidential to the same extent
required of the Lenders hereunder; (H) as to any Lender or its Affiliate, as
expressly permitted under the terms of any other document or agreement regarding
confidentiality to which the Company or any Subsidiary is party or is deemed
party with such Lender or such Affiliate; and (I) to its Affiliates.
11.10 Set-off. In addition to any rights and remedies of the Lenders
provided by law, if an Event of Default exists or the Loans have been
accelerated, each Lender is authorized at any time and from time to time,
without prior notice to any Borrower any such notice being waived by each
Borrower to the fullest extent permitted by law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final) at any
time held by, and other indebtedness at any time owing by, such Lender to or for
the credit or the account of any Borrower against any and all Obligations owing
to such Lender, now or hereafter existing, irrespective of whether or not the
Agent or such Lender shall have made demand under this Agreement or any Loan
Document and although such Obligations may be contingent or unmatured. Each
Lender agrees promptly to notify the Company and the Agent after any such
set-off and application made by such Lender; provided, however, that the failure
to give such notice shall not affect the validity of such set-off and
application.
11.11 Automatic Debits of Fees. With respect to any principal or interest
due on the Loans, unreimbursed L/C Obligation, Commitment Fees, arrangement fee,
letter of credit fee or other fee, or any other cost or expense (including
Attorney Costs) due and payable to the Agent, the Issuing Lender or B of A under
the Loan Documents, each Borrower hereby irrevocably authorizes B of A to debit
any deposit account of such Borrower with B of A or any of its Affiliates in an
amount such that the aggregate amount debited from all such deposit accounts
does not exceed such fee or other cost or expense. If there are insufficient
funds in such deposit accounts to cover the amount of the fee or other cost or
expense then due, such debits will be reversed (in whole or in part, in B of A's
sole discretion) and such amount not debited shall be deemed to be unpaid. No
such debit under this Section shall be deemed a set-off.
11.12 Notification of Addresses, Lending Offices, Etc. Each Lender shall
notify the Agent in writing of any changes in the address to which notices to
the Lender should be directed, of addresses of any lending office of such
Lender, of payment instructions in respect of all payments to be made to it
hereunder and of such other administrative information as the Agent shall
reasonably request.
11.13 Counterparts. This Agreement may be executed in any number of
separate counterparts, each of which, when so executed, shall be deemed an
original, and all of said counterparts taken together shall be deemed to
constitute but one and the same instrument.
11.14 Severability. The illegality or unenforceability of any provision of
this Agreement or any instrument or agreement required hereunder shall not in
any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or any instrument or agreement required hereunder.
11.15 No Third Parties Benefited. This Agreement is made and entered into
for the sole protection and legal benefit of the Borrower, the Lenders, the
Agent and the Agent-Related Persons, and their permitted successors and assigns,
and no other Person shall be a direct or indirect legal beneficiary of, or have
any direct or indirect cause of action or claim in connection with, this
Agreement or any of the other Loan Documents.
11.16 Governing Law and Jurisdiction.
(a) THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF ILLINOIS (WITHOUT REGARD TO CONFLICT OF
LAW PROVISIONS); PROVIDED THAT THE PARTIES SHALL RETAIN ALL RIGHTS ARISING UNDER
FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF ILLINOIS OR OF
THE UNITED STATES FOR THE NORTHERN DISTRICT OF ILLINOIS, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH OF THE BORROWER'S, THE AGENT'S AND THE LENDER'S
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF THE BORROWERS, THE AGENT AND THE LENDERS
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT
OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. EACH OF THE BORROWERS, THE
AGENT AND THE LENDERS EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR
OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY ILLINOIS LAW.
11.17 Waiver of Jury Trial. EACH OF THE BORROWERS, THE LENDERS AND THE
AGENT WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN
DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION,
PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST
ANY OTHER PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER
WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE BORROWERS, THE
LENDERS AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE
TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE
PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED
BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING
WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF
THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF.
THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
11.18 Judgment. If, for the purposes of obtaining judgment in any court, it
is necessary to convert a sum due hereunder or under any other Loan Document in
one currency into another currency, the rate of exchange used shall be that at
which in accordance with normal banking procedures the Agent could purchase the
first currency with such other currency on the Business Day preceding that on
which final judgment is given. The obligation of the Company in respect of any
such sum due from it to the Agent or any Lender hereunder or under the other
Loan Documents shall, notwithstanding any judgment in a currency (the "Judgment
Currency") other than that in which such sum is denominated in accordance with
the applicable provisions of this Agreement (the "Agreement Currency"), be
discharged only to the extent that on the Business Day following receipt by the
Agent or such Lender of any sum adjudged to be so due in the Judgment Currency,
the Agent or such Lender may in accordance with normal banking procedures
purchase the Agreement Currency with the Judgment Currency. If the amount of
the Agreement Currency so purchased is less than the sum originally due to the
Agent or such Lender in the Agreement Currency, the Company agrees, as a
separate obligation and notwithstanding any such judgment, to indemnify the
Agent or such Lender or the Person to whom such obligation was owing against
such loss. If the amount of the Agreement Currency so purchased is greater than
the sum originally due to the Agent or such Lender in such currency, the Agent
or such Lender agrees to return the amount of any excess to the Company (or to
any other Person who may be entitled thereto under applicable law).
11.19 Entire Agreement. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among each of the
Borrowers, the Lenders and the Agent, and supersedes all prior or
contemporaneous agreements and understandings of such Persons, verbal or
written, relating to the subject matter hereof and thereof.
11.20 Effectiveness. Subject to Section 5.01(a), this Agreement shall
become effective on the date (the "Effective Date") on which the Agent, each
Borrower and each of the Lenders shall have signed a counterpart of this
Agreement (whether the same or different counterparts) and shall have delivered
the same to the Agent at its notice address (or to Agent's counsel as directed
by such counsel) or, in the case of the Lenders, shall have given to Agent or
telephonic (confirmed in writing), written, telex or facsimile notice (actually
received) at such office or the office of Agent's counsel that the same has been
signed and mailed to it. Agent will give the Company and each Lender prompt
written notice of the occurrence of the Effective Date.
11.21 Release. Each Borrower hereby unconditionally and irrevocably
remises, acquits, and fully and forever releases and discharges each Lender, the
Agent and the Issuing Lender, and all affiliates, subsidiaries, officers,
employees, agents, attorneys, principals, directors and shareholders of such
Persons, and their respective heirs, legal representatives, successors and
assigns (collectively, the "Releasees") from any and all claims, demands, causes
of action, obligations, remedies, suits, damages and liabilities of any nature
whatsoever, whether now known, suspected or claimed, whether arising under
common law, in equity or under statute, which such Borrower ever had or now has
against any of the Releasees and which may have arisen at any time on or prior
to the Closing Date and which were in any manner related to this Agreement or
the Existing Credit Agreement or related documents, instruments or agreements or
the enforcement or attempted or threatened enforcement by any of the Releasees
of any of their respective rights, remedies or recourse related thereto (the
"Released Claims"). Each Borrower covenants and agrees never to commence,
voluntarily aid in any way, prosecute or cause to be commenced or prosecuted
against any of the Releasees any action or other proceeding based upon any of
the Released Claims.
ARTICLE XII
COMPANY GUARANTY
12.01 The Guaranty. In order to induce the Lenders to enter into this
Agreement and to extend credit hereunder and in recognition of the direct
benefits to be received by the Company from the proceeds of the Loans and the
issuance of the Letters of Credit, the Company hereby agrees with the Lenders as
follows: the Company hereby unconditionally and irrevocably guarantees as
primary obligor and not merely as surety the full and prompt payment when due,
whether upon maturity, acceleration or otherwise, of any and all of the
Guaranteed Obligations of the Subsidiary Borrowers to the Guaranteed Creditors.
If any or all of the Guaranteed Obligations of such Borrowers to the Guaranteed
Creditors becomes due and payable hereunder, the Company unconditionally
promises to pay such indebtedness to Agent and/or the Lenders, on demand,
together with any and all expenses which may be incurred by the Agent or the
Lenders in collecting any of the Guaranteed Obligations. If claim is ever made
upon any Guaranteed Creditor for repayment or recovery of any amount or amounts
received in payment or on account of any of the Guaranteed Obligations and any
of the aforesaid payees repays all or part of said amount by reason of (i) any
judgment, decree or order of any court or administrative body having
jurisdiction over such payee or any of its property or (ii) any settlement or
compromise of any such claim effected by such payee with any such claimant
(including Borrowers), then and in such event the Company agrees that any such
judgment, decree, order, settlement or compromise shall be binding upon the
Company, notwithstanding any revocation of this Guaranty or other instrument
evidencing any liability of any Borrower, and the Company shall be and remain
liable to the aforesaid payees hereunder for the amount so repaid or recovered
to the same extent as if such amount had never originally been received by any
such payee.
12.02 Insolvency. Additionally, the Company unconditionally and irrevocably
guarantees the payment of the Dollar Equivalent of any and all of the Guaranteed
Obligations of the Subsidiary Borrowers to the Guaranteed Creditors whether or
not due or payable by any Borrower upon the occurrence of any of the events
specified in Sections 9.01(e) or (f), and unconditionally promises to pay the
Dollar Equivalent of such Guaranteed Obligations to the Guaranteed Creditors, or
order, on demand, in lawful money of the United States.
12.03 Nature of Liability. The liability of the Company hereunder is
exclusive and independent of any security for or other guaranty of the
Guaranteed Obligations of any Borrower whether executed by the Company, any
other guarantor or by any other party, and the liability of the Company
hereunder is not affected or impaired by (a) any direction as to application of
payment by any Borrower or by any other party; or (b) any other continuing or
other guaranty, undertaking or maximum liability of a guarantor or of any other
party as to the Guaranteed Obligations of any Borrower; or (c) any payment on or
in reduction of any such other guaranty or undertaking; or (d) any dissolution,
termination or increase, decrease or change in personnel by any Borrower; or (e)
any payment made to any Guaranteed Creditor on the Guaranteed Obligations which
any such Guaranteed Creditor repays to any Borrower pursuant to court order in
any bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceeding, and the Company waives any right to the deferral or modification of
its obligations hereunder by reason of any such proceeding.
12.04 Independent Obligation. The obligations of the Company hereunder are
independent of the obligations of any other guarantor, any other party or any
Borrower, and a separate action or actions may be brought and prosecuted against
the Company whether or not action is brought against any other guarantor, any
other party or any Borrower and whether or not any other guarantor, any other
party or any Borrower be joined in any such action or actions. The Company
waives, to the full extent permitted by law, the benefit of any statute of
limitations affecting its liability hereunder or the enforcement thereof. Any
payment by a Borrower or other circumstance which operates to toll any statute
of limitations as to such Borrower shall operate to toll the statute of
limitations as to the Company's obligations under this Article XII.
12.05 Authorization. The Company authorizes the Guaranteed Creditors
without notice or demand (except as shall be required by applicable statute and
cannot be waived), and without affecting or impairing its liability hereunder,
from time to time to:
(a) change the manner, place or terms of payment of, and/or change or
extend the time of payment of, renew, increase, accelerate or alter, any of the
Guaranteed Obligations (including any increase or decrease in the rate of
interest thereon), any security therefor, or any liability incurred directly or
indirectly in respect thereof, and the Guaranty herein made shall apply to the
Guaranteed Obligations as so changed, extended, renewed or altered;
(b) take and hold security for the payment of the Guaranteed Obligations and
sell, exchange, release, surrender, realize upon or otherwise deal with in any
manner and in any order any property by whomsoever at any time pledged or
mortgaged to secure, or howsoever securing, the Guaranteed Obligations or any
liabilities (including any of those hereunder) incurred directly or indirectly
in respect thereof or hereof, and/or any offset thereagainst;
(c) exercise or refrain from exercising any rights against any Borrower or
others or otherwise act or refrain from acting;
(d) release or substitute any one or more indorsers, guarantors, any
Borrower or other obligors;
(e) settle or compromise any of the Guaranteed Obligations, any security
therefor or any liability (including any of those hereunder) incurred directly
or indirectly in respect thereof or hereof, and may subordinate the payment of
all or any part thereof to the payment of any liability (whether due or not) of
any Borrower to its creditors other than the Guaranteed Creditors;
(f) apply any sums by whomsoever paid or howsoever realized to any liability
or liabilities of any Borrower to the Guaranteed Creditors regardless of what
liability or liabilities of the Company or any Borrower remain unpaid;
(g) consent to or waive any breach of, or any act, omission or default
under, this Agreement or any of the instruments or agreements referred to
herein, or otherwise amend, modify or supplement this Agreement or any of such
other instruments or agreements; and/or
(h) take any other action which would, under otherwise applicable principles
of common law, give rise to a legal or equitable discharge of the Company from
its liabilities under this Guaranty.
12.06 Reliance. It is not necessary for any Guaranteed Creditor to
inquire into the capacity or powers of any Borrower or the officers, directors,
partners or agents acting or purporting to act on their behalf, and any
Guaranteed Obligations made or created in reliance upon the professed exercise
of such powers shall be guaranteed hereunder.
12.07 Subordination. Any of the indebtedness of each Borrower relating to
the Guaranteed Obligations now or hereafter owing to the Company is hereby
subordinated to the Guaranteed Obligations of such Borrower owing to the
Guaranteed Creditors; and if Agent so requests at a time when an Event of
Default exists, all such indebtedness relating to the Guaranteed Obligations of
such Borrower to the Company shall be collected, enforced and received by the
Company for the benefit of the Guaranteed Creditors and be paid over to Agent on
behalf of the Guaranteed Creditors on account of the Guaranteed Obligations of
such Borrower to the Guaranteed Creditors, but without affecting or impairing in
any manner the liability of the Company under the other provisions of this
Guaranty. Prior to the transfer by the Company of any note or negotiable
instrument evidencing any of the indebtedness relating to the Guaranteed
Obligations of such Borrower to the Company, the Company shall xxxx such note or
negotiable instrument with a legend that the same is subject to this
subordination. Without limiting the generality of the foregoing, the Company
hereby agrees with the Guaranteed Creditors that it will not exercise any right
of subrogation which it may at any time otherwise have as a result of this
Guaranty (whether contractual, under Section 509 of the Bankruptcy Code or
otherwise) until all Guaranteed Obligations have been irrevocably paid in full
in cash.
12.08 Waiver.
(a) The Company waives any right (except as shall be required by
applicable statute and cannot be waived) to require any Guaranteed Creditor to
(i) proceed against any Borrower, any other guarantor or any other party, (ii)
proceed against or exhaust any security held from any Borrower, any other
guarantor or any other party or (iii) pursue any other remedy in any Guaranteed
Creditor's power whatsoever. The Company waives any defense based on or arising
out of any defense of any Borrower, any other guarantor or any other party,
other than payment in full of the Guaranteed Obligations, based on or arising
out of the disability of any Borrower, any other guarantor or any other party,
or the validity, legality or unenforceability of the Guaranteed Obligations or
any part thereof from any cause, or the cessation from any cause of the
liability of any Borrower other than payment in full of the Guaranteed
Obligations. The Guaranteed Creditors may, at their election, foreclose on any
security held by Agent or any other Guaranteed Creditor by one or more judicial
or nonjudicial sales, whether or not every aspect of any such sale is
commercially reasonable (to the extent such sale is permitted by applicable
law), or exercise any other right or remedy the Guaranteed Creditors may have
against any Borrower or any other party, or any security, without affecting or
impairing in any way the liability of the Company hereunder except to the extent
the Guaranteed Obligations have been paid. The Company waives any defense
arising out of any such election by the Guaranteed Creditors, even though such
election operates to impair or extinguish any right of reimbursement or
subrogation or other right or remedy of the Company against any Borrower or any
other party or any security.
(b) The Company waives all presentments, demands for performance, protests
and notices, including without limitation notices of nonperformance, notices of
protest, notices of dishonor, notices of acceptance of this Guaranty, and
notices of the existence, creation or incurring of new or additional Guaranteed
Obligations. The Company assumes all responsibility for being and keeping
itself informed of each Borrower's financial condition and assets, and of all
other circumstances bearing upon the risk of nonpayment of the Guaranteed
Obligations and the nature, scope and extent of the risks which the Company
assumes and incurs hereunder, and agrees that Agent and the Lenders shall have
no duty to advise the Company of information known to them regarding such
circumstances or risks.
12.09 Nature of Liability. It is the desire and intent of the Company
and the Secured Creditors that this Guaranty shall be enforced against the
Company to the fullest extent permissible under the laws and public policies
applied in each jurisdiction in which enforcement is sought. If, however, and
to the extent that, the obligations of the Company under this Guaranty shall be
adjudicated to be invalid or unenforceable for any reason (including, without
limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers), then the amount of the Guaranteed
Obligations shall be deemed to be reduced and the Company shall pay the maximum
amount of the Guaranteed Obligations which would be permissible under applicable
law.
* * * *
Signature Page
to
Amended and Restated Credit Agreement
Signature Page
to
Amended and Restated Credit Agreement
ABC-NACO INC.
By: ___________________________
Name:
Title:
ABC-NACO de LATINO AMERICA, S.A.
de C.V. (formerly known as ABC-NACO de
Mexico, S.A. de C.V.)
By: ___________________________
Name:
Title:
DOMINION CASTINGS LIMITED
By: ___________________________
Name:
Title:
BANK OF AMERICA, N.A., as Agent
By: ___________________________
Name:
Title:
BANK OF AMERICA, N.A., as Lender and Issuing Lender
By: ___________________________
Name:
Title:
BANK OF AMERICA CANADA, as the Canadian Revolving Lender
By: ___________________________
Name:
Title:
ABN AMRO BANK N.V., as Lender
By: ___________________________
Name:
Title:
By: ___________________________
Name:
Title:
FLEET NATIONAL BANK, as Lender
By: ___________________________
Name:
Title:
BANK ONE, NA (Main Chicago Office), as a Lender
By: ___________________________
Name:
Title:
FIRSTAR BANK, N.A., as Lender
By: ___________________________
Name:
Title:
XXXXXX TRUST AND SAVINGS BANK, as Lender
By: ___________________________
Name:
Title:
LASALLE BANK NATIONAL ASSOCIATION, as Lender
By: ___________________________
Name:
Title:
THE NORTHERN TRUST COMPANY, as Lender
By: ___________________________
Name:
Title:
PNC BANK NATIONAL ASSOCIATION, as Lender
By: ___________________________
Name:
Title:
US BANK NATIONAL ASSOCIATION, as Lender
By: ___________________________
Name:
Title:
SCHEDULE 2.06
The following provisions shall apply solely to the Canadian Revolving Loans
made by the Canadian Revolving Lender. To the extent any of the provisions set
forth in the Schedule 2.05 conflict with the provisions otherwise set forth in
the Credit Agreement, the provisions set forth below shall govern but solely
with respect to the Loans made by the Canadian Revolving Lender. Unless
otherwise defined herein, capitalized terms used in this Schedule 2.05 shall
have the meanings assigned to them in Section 1.01 of the Credit Agreement.
1. Definitions.
"$" means Canadian Dollars or U.S. Dollars, as the context may require.
"Canadian Base Rate Loan" means a Loan in Dollars or Canadian Dollars made by
the Canadian Revolving Lender bearing interest at the Base Rate plus the
Applicable Margin.
"Canadian Borrowing" means a borrowing by the Canadian Borrower under Article II
of the Credit Agreement and in accordance with the terms and conditions of the
Credit Agreement and this Schedule 2.05.
"Canadian Borrowing Date" means a day on which a Canadian Borrowing occurs.
"Canadian Loan" shall mean a Canadian Base Rate Loan.
2. Procedure for Canadian Borrowings.
(a) Each Canadian Borrowing by the Canadian Borrower shall be made upon
the Canadian Borrower's irrevocable written notice delivered to the Agent and
the Canadian Revolving Lender in a form specified by the Agent and the Canadian
Revolving Lender, which notice must be received by each of the Agent and the
Canadian Revolving Lender prior to 11:00 a.m. (Toronto time) on the date of the
requested Canadian Borrowing Date, specifying:
(i) the amount of the Canadian Borrowing, which shall be in an
aggregate minimum amount of $1,000,000, or any multiple of $100,000 in excess
thereof (which borrowing shall be denominated either in Canadian Dollars or
Dollars);
(ii) the requested Canadian Borrowing Date, which shall be a Business Day;
and
(iii) whether such Canadian Loans are to be denominated in Canadian Dollars
or Dollars. If the notice of borrowing fails to specify the currency in which
such Loans are to be denominated, the denomination will be deemed to be Canadian
Dollars.
(b) The Canadian Borrower hereby authorizes the Canadian Revolving
Lender and the Agent to accept Notices of Borrowing based on telephonic notices
made by any person or persons the Agent or the Canadian Revolving Lender in good
faith believes to be acting on behalf of the Canadian Borrower or the Company.
The Canadian Borrower agrees to deliver promptly to the Agent and the Canadian
Revolving Lender a written confirmation of each telephonic notice, signed by a
Responsible Officer or an authorized designee. If the written confirmation
differs in any material respect from the action taken by the Agent and the
Canadian Revolving Lender, the records of the Agent and the Canadian Revolving
Lender shall govern, absent manifest error.
3. Loan Accounts.
(a) The Canadian Revolving Loans shall be evidenced by one or more
accounts or records maintained by the Canadian Revolving Lender and the Agent in
the ordinary course of business. The loan accounts or records maintained by the
Agent and the Canadian Revolving Lender shall be presumed correct absent
manifest error of the amount of the Canadian Revolving Loans made to the
Canadian Borrower, and the interest and payments thereon. Any failure so to
record or any error in doing so shall not, however, limit or otherwise affect
the obligation of the Canadian Borrower hereunder to pay any amount owing with
respect to the Canadian Revolving Loans.
(b) Upon the request of the Canadian Revolving Lender made through the
Agent, the Canadian Revolving Loans made by the Canadian Revolving Lender may be
evidenced by one or more Notes, instead of or in addition to loan accounts. The
Canadian Revolving Lender shall record on the schedules annexed to its Note(s)
the date, amount and maturity of each Loan made by it and the amount and
applicable currency of each payment of principal made by the Canadian Borrower
with respect thereto. The Canadian Revolving Lender is irrevocably authorized
by the Canadian Borrower to make such recordations on its Note(s) and such
Lender's record shall be presumed correct absent manifest error; provided,
however, that the failure of the Canadian Revolving Lender to make, or an error
in making, a notation thereon with respect to any Loan shall not limit or
otherwise affect the obligations of the Canadian Borrower hereunder or under any
such Note to such Lender.
4. Voluntary Termination or Reduction of Canadian Subsidiary Loan
Sublimit. The Company may in accordance with Section 2.08 of the Credit
Agreement specify that some or all of a requested reduction in Revolving
Commitments be applied to the Canadian Subsidiary Loan Sublimit. Any such
reduction shall be in an aggregate minimum amount of $1,000,000 or any multiple
of $1,000,000 in excess thereof; unless, after giving effect thereto and to any
prepayments of Loans made on the effective date thereof, the Effective Amount of
all Canadian Revolving Loans to Canadian Borrower would exceed the Canadian
Subsidiary Loan Sublimit. Once reduced in accordance with this Section, the
Canadian Subsidiary Loan Sublimit as so reduced may not be increased without the
consent of the Canadian Revolving Lender. Absent notice to the Agent and the
Canadian Revolving Lender, no voluntary prepayment of Canadian Revolving Loans
shall permanently reduce the Canadian Subsidiary Loan Sublimit.
5. Prepayments.
(a) The Canadian Borrower may, at any time or from time to time, and
without premium or penalty, with such amount of advance notice as the Canadian
Revolving Lender may specify, prepay Canadian Revolving Loans to the Canadian
Revolving Lender, in minimum amounts of $1,000,000, or any multiple of $100,000
in the applicable currency in excess thereof. Such notice of prepayment shall
specify the date and amount of such prepayment and applicable currency. Such
notice shall not thereafter be revocable by the Canadian Borrower. If such
notice is given by the Canadian Borrower, such Borrower shall make such
prepayment and the payment amount specified in such notice shall be due and
payable on the date specified therein, together with accrued interest to each
such date on the amount prepaid.
(b) If on any Computation Date the Canadian Revolving Lender shall have
determined that the Effective Amount of all Canadian Revolving Loans then
outstanding exceeds the Canadian Subsidiary Loan Sublimit by more than 2% of the
Canadian Subsidiary Loan Sublimit due to a change in applicable rates of
exchange between Dollars and the Canadian Dollar, then the Canadian Revolving
Lender may in its sole discretion require the Agent to give notice to the
Canadian Borrower that a prepayment is required under this section, and Canadian
Borrower agrees thereupon to make prepayment of Canadian Revolving Loans such
that, after giving effect to all such prepayments, the Effective Amount of all
Canadian Revolving Loans does not exceed the Canadian Subsidiary Loan Sublimit.
6. Repayment.
Canadian Borrower shall repay to the Lenders on the Termination Date the
aggregate principal amount of its respective Loans and other obligations
outstanding on such date or on such earlier date as may be required in order for
the Borrower to comply with the provisions of Section 2.07(b) or (c) of the
Credit Agreement.
7. Interest.
(a) Each Canadian Revolving Loan shall bear interest on the outstanding
principal amount thereof from the applicable Borrowing Date at a rate per annum
equal to the , plus the Applicable Margin.
(b) Interest on each Canadian Revolving Loan shall be paid in arrears on
each Interest Payment Date. Interest shall also be paid on the date of any
prepayment of Canadian Loans for the portion of the Loans so prepaid and upon
payment (including prepayment) in full thereof and, during the existence of any
Event of Default, interest shall be paid on demand of the Agent at the request
of the Canadian Revolving Lender.
(c) Notwithstanding the foregoing, while any Event of Default exists or
after acceleration, the Canadian Borrower shall pay interest (after as well as
before entry of judgment thereon to the extent permitted by law) on the
principal amount of all of its outstanding Obligations, at a rate per annum
which is determined by adding 2% per annum to the applicable interest rate
otherwise then in effect for such Loans.
(d) Anything herein to the contrary notwithstanding, the obligations of the
Canadian Borrower to any Lender hereunder shall be subject to the limitation
that payments of interest shall not be required for any period for which
interest is computed hereunder, to the extent (but only to the extent) that
contracting for or receiving such payment by such Lender would be contrary to
the provisions of any law applicable to such Lender limiting the highest rate of
interest that may be lawfully contracted for, charged or received by such
Lender, and in such event applicable Borrower shall pay such Lender interest at
the highest rate permitted by applicable law.
8. Computation of Fees and Interest. All computations of interest for
Canadian Base Rate Loans shall be made on the basis of a year of 365 or 366
days, as the case may be, and actual days elapsed. Interest and fees shall
accrue during each period during which interest or such fees are computed from
the first day thereof to the last day thereof.
9. Payments by the Canadian Borrower.
(a) All payments to be made by the Canadian Borrower shall be made
without set-off, recoupment or counterclaim. Except for payments required to be
made to the Canadian Revolving Lender or as otherwise expressly provided herein,
all payments by any Borrower shall be made to the Canadian Revolving Lender for
its account at the Canadian Revolving Lender's offices in Toronto, Ontario shall
be made in the applicable currency in which such Loan is denominated or payable.
Such payments shall be made in immediately available funds, and (i) in the case
of Canadian Dollars payments, no later than such time on the dates specified
herein as may be determined by the Agent or the Canadian Revolving Lender, as
the case may be, to be necessary for such payment to be credited on such date in
accordance with normal banking procedures in the place of payment, and (ii) in
the case of any Dollar payments, no later than 11:00 a.m. (Toronto time) on the
date specified herein. Any payment which is received by the Canadian Revolving
Lender later than 11:00 a.m. (Toronto time), or later than the time specified by
the Agent or the Canadian Revolving Lender as provided in clause (i) above (in
the case of Canadian Dollar payments), shall be deemed to have been received on
the following Business Day and any applicable interest or fee shall continue to
accrue.
(b) Whenever any payment is due on a day other than a Business Day, such
payment shall be made on the following Business Day, and such extension of time
shall in such case be included in the computation of interest or fees, as the
case may be.
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