CREDIT AGREEMENT
Dated as of September_24, 1997
among
BUCYRUS INTERNATIONAL, INC.,
BANK ONE, WISCONSIN,
as Agent
and
Letter of Credit Issuing Bank,
THE BANK OF NOVA SCOTIA,
as Documentation Agent
and
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
Arranged by:
BANK ONE CAPITAL MARKETS
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS. . . . . . . . . . . 1
1.01 Certain Defined Terms . . . . . . . . . . . . . . . . . 1
1.02 Other Interpretive Provisions . . . . . . . . . . . . .29
1.03 Accounting Principles . . . . . . . . . . . . . . . . .30
ARTICLE II
THE CREDITS. . . . . . . . . . .30
2.01 Amounts and Terms of Commitments. . . . . . . . . . . .30
2.02 Loan Accounts . . . . . . . . . . . . . . . . . . . . .30
2.03 Procedure for Borrowing . . . . . . . . . . . . . . . .31
2.04 Conversion and Continuation Elections . . . . . . . . .32
2.05 Voluntary Termination or Reduction of Commitments . . .33
2.06 Optional Prepayments. . . . . . . . . . . . . . . . . .34
2.07 Mandatory Prepayments of Loans; Mandatory Commitment
Reductions . . . . . . . . . . . . . . . . . . . . . .34
2.08 Repayment . . . . . . . . . . . . . . . . . . . . . . .35
2.09 Interest. . . . . . . . . . . . . . . . . . . . . . . .35
2.10 Fees. . . . . . . . . . . . . . . . . . . . . . . . . .35
_____(a) Arrangement, Agency Fees. . . . . . . . . . . . .36
_____(b) Commitment Fees . . . . . . . . . . . . . . . . .36
2.11 Computation of Fees and Interest. . . . . . . . . . . .36
2.12 Payments by the Company . . . . . . . . . . . . . . . .36
2.13 Payments by the Banks to the Agent. . . . . . . . . . .37
2.14 Sharing of Payments, Etc. . . . . . . . . . . . . . . .38
2.15 Sharing and Application of Collateral Proceeds. . . . .38
2.16 ABL Trigger Event.. . . . . . . . . . . . . . . . . . .38
ARTICLE III
THE LETTERS OF CREDIT. . . . . .39
3.01 The Letter of Credit Subfacility. . . . . . . . . . . .39
3.02 Issuance, Amendment and Renewal of Letters of Credit. .40
3.03 Existing Bank One Letters of Credit; Risk Participations,
____________Drawings and Reimbursements . . . . . . . . . . .42
3.04 Repayment of Participations . . . . . . . . . . . . . .44
3.05 Role of the Issuing Bank. . . . . . . . . . . . . . . .45
3.06 Obligations Absolute. . . . . . . . . . . . . . . . . .46
3.07 Cash Collateral Pledge. . . . . . . . . . . . . . . . .47
3.08 Letter of Credit Fees . . . . . . . . . . . . . . . . .47
3.09 Uniform Customs and Practice. . . . . . . . . . . . . .47
ARTICLE IV
TAXES, YIELD PROTECTION AND
ILLEGALITY 48
4.01 Taxes.. . . . . . . . . . . . . . . . . . . . . . . . .48
4.02 Illegality. . . . . . . . . . . . . . . . . . . . . . .49
4.03 Increased Costs and Reduction of Return . . . . . . . .49
4.04 Funding Losses. . . . . . . . . . . . . . . . . . . . .50
4.05 Inability to Determine Rates. . . . . . . . . . . . . .51
4.06 Certificates of Banks . . . . . . . . . . . . . . . . .51
4.07 Substitution of Banks . . . . . . . . . . . . . . . . .52
4.08 Survival. . . . . . . . . . . . . . . . . . . . . . . .52
ARTICLE V
CONDITIONS PRECEDENT . . . . . .52
5.01 Conditions of Initial Credit Extensions . . . . . . . .52
_____(a) Credit Agreement and Notes . . . . . . . . . . . .52
_____(b) Subsidiary Guaranties. . . . . . . . . . . . . . .52
_____(c) Security Documents . . . . . . . . . . . . . . . .52
_____(d) Resolutions; Incumbency. . . . . . . . . . . . . .53
_____(e) Organization Documents; Good Standing. . . . . . .53
_____(f) Machinery and Equipment Appraisal. . . . . . . . .54
_____(g) Lien Searches. . . . . . . . . . . . . . . . . . .54
_____(h) Borrowing Base Certificate . . . . . . . . . . . .54
_____(i) Insurance Certificates . . . . . . . . . . . . . .54
_____(k) Redemption of 1994 Secured Notes; Repayment of
Loans under the Existing Bank One Credit
Agreement; Termination Statements. . . . . . . . .54
_____(l) Issuance of the 1997 Senior Notes. . . . . . . . .54
_____(m) Xxxxxx Acquisition . . . . . . . . . . . . . . . .55
_____(n) Legal Opinions . . . . . . . . . . . . . . . . . .55
_____(o) Payment of Fees. . . . . . . . . . . . . . . . . .55
_____(p) Certificate. . . . . . . . . . . . . . . . . . . .55
_____(q) Surplus Assets . . . . . . . . . . . . . . . . . .55
_____(r) Other Documents. . . . . . . . . . . . . . . . . .56
5.02 Conditions to All Credit Extensions . . . . . . . . . .56
_____(a) Notice, Application . . . . . . . . . . . . . . .56
_____(b) Continuation of Representations and Warranties. .56
_____(c) No Existing Default . . . . . . . . . . . . . . .57
ARTICLE VI
REPRESENTATIONS AND WARRANTIES .57
6.01 Corporate Existence and Power . . . . . . . . . . . . .57
6.02 Corporate Authorization; No Contravention . . . . . . .57
6.03 Governmental Authorization. . . . . . . . . . . . . . .58
6.04 Binding Effect. . . . . . . . . . . . . . . . . . . . .58
6.05 Litigation. . . . . . . . . . . . . . . . . . . . . . .58
6.06 No Default. . . . . . . . . . . . . . . . . . . . . . .58
6.07 ERISA Compliance. . . . . . . . . . . . . . . . . . . .59
6.08 Use of Proceeds; Margin Regulations . . . . . . . . . .59
6.09 Title to Properties . . . . . . . . . . . . . . . . . .59
6.10 Taxes . . . . . . . . . . . . . . . . . . . . . . . . .60
6.11 Financial Condition . . . . . . . . . . . . . . . . . .60
6.12 Environmental Matters . . . . . . . . . . . . . . . . .61
6.13 Regulated Entities. . . . . . . . . . . . . . . . . . .61
6.14 No Burdensome Restrictions. . . . . . . . . . . . . . .61
6.15 Copyrights, Patents, Trademarks and Licenses, etc.. . .61
6.16 Subsidiaries. . . . . . . . . . . . . . . . . . . . . .62
6.17 Insurance . . . . . . . . . . . . . . . . . . . . . . .62
6.18 Swap Obligations. . . . . . . . . . . . . . . . . . . .62
6.19 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 . . . . . . . . . . . . . . . .65
7.06 Insurance . . . . . . . . . . . . . . . . . . . . . . .65
7.07 Payment of Obligations . . . . . . . . . . . . . . . . .66
7.08 Compliance with Laws. . . . . . . . . . . . . . . . . .66
7.09 Compliance with ERISA . . . . . . . . . . . . . . . . .66
7.10 Inspection of Property and Books and Records. . . . . .66
7.11 Environmental Laws. . . . . . . . . . . . . . . . . . .67
7.12 Use of Proceeds . . . . . . . . . . . . . . . . . . . .67
7.13 Obligations under Other Loan Documents. . . . . . . . .67
7.14 Future Subsidiary Guarantors. . . . . . . . . . . . . .67
ARTICLE VIII
NEGATIVE COVENANTS . . . . . . .67
8.01 Limitation on Liens . . . . . . . . . . . . . . . . . .67
8.02 Disposition of Assets . . . . . . . . . . . . . . . . .70
8.03 Consolidations and Mergers. . . . . . . . . . . . . . .71
8.04 Loans and Investments . . . . . . . . . . . . . . . . .71
8.05 Limitation on Indebtedness. . . . . . . . . . . . . . .72
8.06 Transactions with Affiliates. . . . . . . . . . . . . .73
8.07 Use of Proceeds . . . . . . . . . . . . . . . . . . . .73
8.08 Contingent Obligations. . . . . . . . . . . . . . . . .74
8.09 Joint Ventures. . . . . . . . . . . . . . . . . . . . .74
8.10 Lease Obligations . . . . . . . . . . . . . . . . . . .74
8.11 Restricted Payments . . . . . . . . . . . . . . . . . .75
8.12 ERISA . . . . . . . . . . . . . . . . . . . . . . . . .75
8.13 Change in Business. . . . . . . . . . . . . . . . . . .75
8.14 Accounting Changes. . . . . . . . . . . . . . . . . . .75
8.15 Redemption of 1997 Senior Notes . . . . . . . . . . . .76
8.16 Financial Covenants . . . . . . . . . . . . . . . . . .76
_________(a) Senior Funded Debt to EBITDA Ratio. . . . . . .76
_________(b) Fixed Charge Coverage Ratio . . . . . . . . . .77
_________(c) Interest Coverage Ratio . . . . . . . . . . . .77
_________(d) Net Worth . . . . . . . . . . . . . . . . . . .77
8.17 Capital Expenditures. . . . . . . . . . . . . . . . . .78
8.18 Western Gear. . . . . . . . . . . . . . . . . . . . . .78
ARTICLE IX
EVENTS OF DEFAULT. . . . . . . .78
9.01 Event of Default. . . . . . . . . . . . . . . . . . . .78
_____(a) Non-Payment. . . . . . . . . . . . . . . . . . . .78
_____(b) Representation or Warranty . . . . . . . . . . . .78
_____(c) Specific Defaults. . . . . . . . . . . . . . . . .78
_____(d) Other Defaults . . . . . . . . . . . . . . . . . .78
_____(e) Cross-Default. . . . . . . . . . . . . . . . . . .79
_____(f) Insolvency; Voluntary Proceedings. . . . . . . . .79
_____(g) Involuntary Proceedings. . . . . . . . . . . . . .79
_____(h) ERISA. . . . . . . . . . . . . . . . . . . . . . .80
_____(i) Monetary Judgments . . . . . . . . . . . . . . . .80
_____(j) Non-Monetary Judgments . . . . . . . . . . . . . .80
_____(k) Change of Control. . . . . . . . . . . . . . . . .80
_____(l) Subsidiary Guarantor Defaults. . . . . . . . . . .80
9.02 Remedies. . . . . . . . . . . . . . . . . . . . . . . .81
9.03 Rights Not Exclusive. . . . . . . . . . . . . . . . . .81
9.04 Certain Financial Covenant Defaults . . . . . . . . . .81
ARTICLE X
THE AGENT. . . . . . . . . . . .82
10.01 Appointment and Authorization; . . . . . . . . . . . .82
10.02 Delegation of Duties . . . . . . . . . . . . . . . . .82
10.03 Liability of Agent . . . . . . . . . . . . . . . . . .82
10.04 Reliance by Agent. . . . . . . . . . . . . . . . . . .83
10.05 Notice of Default. . . . . . . . . . . . . . . . . . .83
10.06 Credit Decision. . . . . . . . . . . . . . . . . . . .84
10.07 Indemnification of Agent . . . . . . . . . . . . . . .84
10.08 Agent in Individual Capacity . . . . . . . . . . . . .85
10.09 Successor Agent. . . . . . . . . . . . . . . . . . . .85
10.10 Withholding Tax. . . . . . . . . . . . . . . . . . . .86
10.11 Documentation Agent. . . . . . . . . . . . . . . . . .87
ARTICLE XI
MISCELLANEOUS. . . . . . . . . .87
11.01 Amendments and Waivers . . . . . . . . . . . . . . . .87
11.02 Notices. . . . . . . . . . . . . . . . . . . . . . . .88
11.03 No Waiver; Cumulative Remedies . . . . . . . . . . . .89
11.04 Costs and Expenses . . . . . . . . . . . . . . . . . .89
11.05 Company Indemnification. . . . . . . . . . . . . . . .90
11.06 Payments Set Aside . . . . . . . . . . . . . . . . . .90
11.07 Successors and Assigns . . . . . . . . . . . . . . . .90
11.08 Assignments, Participations, etc.. . . . . . . . . . .90
11.09 Confidentiality. . . . . . . . . . . . . . . . . . . .92
11.10 Set-off. . . . . . . . . . . . . . . . . . . . . . . .93
11.11 Automatic Debits of Fees . . . . . . . . . . . . . . .93
11.12 Notification of Addresses, Lending Offices, Etc. . . .93
11.13 Counterparts . . . . . . . . . . . . . . . . . . . . .93
11.14 Severability . . . . . . . . . . . . . . . . . . . . .94
11.15 No Third Parties Benefited . . . . . . . . . . . . . .94
11.16 Governing Law and Jurisdiction . . . . . . . . . . . .94
11.17 Waiver of Jury Trial . . . . . . . . . . . . . . . . .94
11.18 Entire Agreement . . . . . . . . . . . . . . . . . . .95
SCHEDULES
Schedule 2.01 Commitments
Schedule 3.03 Existing Bank One Letters of Credit
Schedule 6.05 Litigation
Schedule 6.07 ERISA
Schedule 6.09 Real Property Liens
Schedule 6.10 Tax Matters
Schedule 6.11 Undisclosed Liabilities
Schedule 6.12 Environmental Matters
Schedule 6.16 Subsidiaries and Minority Interests
Schedule 6.17 Insurance Matters
Schedule 8.01 Permitted Liens
Schedule 8.05 Permitted 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 Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D Form of Legal Opinion of Company's Counsel
Exhibit E Form of Assignment and Acceptance
Exhibit F Form of Promissory Note
Exhibit G Form of Borrowing Base Certificate
Exhibit H Form of Company Security Agreement
Exhibit I Form of Company Pledge Agreement
Exhibit J Form of Subsidiary Guaranty
Exhibit K Form of Subsidiary Guarantor Security Agreement
Exhibit L Form of Assignment of Intercompany Security Agreement
Exhibit M Form of Intercompany Security Agreement
Exhibit N Obsolescence Reserve Policy Statement
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of September_24, 1997, is
among Bucyrus International, Inc., a Delaware corporation (the
Company ), the several financial institutions from time to time
party to this Agreement (collectively, the Banks ; individually, a
Bank ), The Bank of Nova Scotia, as documentation agent, and Bank
One, Wisconsin, as letter of credit issuing bank and as agent for
the Banks.
WHEREAS, the Banks have agreed to make available to the
Company a revolving credit facility with letter of credit
subfacility upon the terms and subject to conditions set forth in
this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements,
provisions and covenants contained herein, the parties agree as
follows:
ARTICLE I
DEFINITIONS
1.01 Certain Defined Terms. The following terms have the
following meanings:
ABL Trigger Event means:
(a) the occurrence of any of the following events:
(i) The ratio of Adjusted Funded Debt to EBITDA, as of the
end of any fiscal quarter set forth in the following table, exceeds the
corresponding ratio:
Date Ratio
December 31, 1997 8.20:1.0
March 31, 1998 6.70:1.0
June 30, 1998 6.40:1.0
September 30, 1998 6.00:1.0
December 31, 1998 5.70:1.0
March 31, 1999 5.55:1.0
June 30, 1999 5.30:1.0
September 30, 1999 5.05:1.0
December 31, 1999 4.80:1.0
March 31, 2000 4.50:1.0
June_30, 2000 4.50:1.0
Each fiscal quarter thereafter 4.30:1.0
(ii) The Fixed Charge Coverage Ratio, as of the end of any
fiscal quarter set forth in the following table, is less than the
corresponding ratio:
Date Ratio
December 31, 1997 1.20:1.0
March 31, 1998 1.25:1.0
June 30, 1998 1.25:1.0
September 30, 1998 1.45:1.0
December 31, 1998 1.50:1.0
March 31, 1999 1.55:1.0
June_30, 1999 1.60:1.0
September 30, 1999 1.60:1.0
December 31, 1999 1.60:1.0
Each fiscal_quarter thereafter 1.65:1.0
(iii) The Interest Coverage Ratio, as of the end of any
fiscal
quarter set forth in the following table, is less than the corresponding
ratio:
Date Ratio
December 31, 1997 1.65:1.0
March 31, 1998 1.65:1.0
June 30, 1998 1.65:1.0
September 30, 1998 1.75:1.0
December 31, 1998 1.90:1.0
March 31, 1999 2.00:1.0
June 30, 1999 2.15:1.0
September 30, 1999 2.25:1.0
December 31, 1999 2.30:1.0
March_31, 2000 2.35:1.0
June_30, 2000 2.35:1.0
Each fiscal quarter thereafter 2.40:1.0
; or (b) The occurrence of (i) any Event of Default under subsections
9.01(a), 9.01(f) or 9.01(g).
An ABL Trigger Event will no longer be considered continuing,
for purposes of this Agreement, (1) at such time as the financial
statements of the Company and its consolidated Subsidiaries for two
consecutive fiscal quarters evidence that no new ABL Trigger Event has
occurred or (2) upon the direction of the Majority Banks.
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 Funded Debt means, with respect to the Company, the
amount (on a consolidated basis) on the date of determination equal to the
sum, without duplication, of (a)_Funded Debt of the Company on such date
(provided that in calculating Funded Debt, the daily average Effective
Amount of Loans during the applicable period ending on such date shall be
used rather than the Effective Amount of Loans on such date) plus (b) the
daily average Effective Amount of L/C Obligations during the applicable
period ending on such date minus (c)_the lower of cost or market value of
all cash, cash equivalents and marketable securities of the type permitted
under subsection 8.04(h) of the Company and its Subsidiaries which are not
subject to any restriction on their use or application on such date.
Adjusted Funded Debt to EBITDA Ratio means the relationship,
expressed as a numerical ratio, between:
(a) Adjusted Funded Debt; and
(b) EBITDA
Adjusted Funded Debt of the Company and its consolidated Subsidiaries
shall be determined based upon consolidated financial statements of the
Company and its consolidated Subsidiaries as of the last day of the fiscal
quarter. EBITDA of the Company and its consolidated Subsidiaries shall be
determined based upon the consolidated financial statements of the Company
and its consolidated Subsidiaries for the 12-month period preceding the
date of determination, excluding therefrom, however, any results
attributable to the operation of the properties acquired in the Xxxxxx
Acquisition before August 26, 1997.
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 Bank One in its capacity as agent for the Banks
hereunder, and any successor agent arising under Section 10.09.
Agent-Related Persons means Bank One and any successor agent
arising under Section 10.09 and any successor letter of credit issuing
bank hereunder, together with their respective Affiliates (including, in
the case of Bank One, the Arranger), 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.
AIP means American Industrial Partners Acquisition Company, LLC,
a Delaware limited liability company, and its Affiliates (including
without limitation Bucyrus Acquisition Corp., a Delaware corporation
( BAC ) and their successors and assigns.
AIP Bridge Loan means that certain bridge loan to be made by
American Industrial Partners Capital Fund II, L.P. (or an Affiliate
thereof) to BAC as part of the consideration in the AIP Purchase, which
bridge loan is to be made only in the event the Short Form Merger (as
defined in the Offering Memorandum for the 1997 Senior Notes) is not
effected.
AIP Purchase means the purchase by BAC of the outstanding common
stock of the Company, and the merger of BAC into the Company (with the
Company as the surviving corporation) (the BAC Merger ), as set forth in
the Agreement and Plan of Merger, dated as of August_21, 1997 (the AIP
Merger Agreement ) among the Company, AIP and BAC.
Applicable Margin means
(i) with respect to Base Rate Loans, 0.50%; and
(iii) with respect to LIBOR Rate Loans, 2.75%;
provided, however, that the Applicable Margin shall be subject to
adjustment on the date which is 45 days after the end of each fiscal
quarter, commencing with the fiscal quarter ending March 31, 1998 (each
such date, a Margin Adjustment Date ) and the Applicable Margin shall be
determined in accordance with the following matrix:
Ratio of Adjusted
Funded Debt to Base Rate Loan LIBOR Rate Loan
EBITDA Applicable Margin Applicable Margin
Less than 2.75:1.0 0.00% 1.50%
2.75:1.0 to 3.24:1.0 0.00% 1.75%
3.25:1.0 to 3.49:1.0 0.00% 2.00%
3.50:1.0 to 3.99:1.0 0.25% 2.25%
4.00:1.0 to 4.49:1.0 0.40% 2.50%
4.50:1.0 or greater 0.50% 2.75%
Adjusted Funded Debt of the Company and its consolidated Subsidiaries
shall be determined based upon consolidated financial statements of the
Company as of the last day of the fiscal quarter prior to each Margin
Adjustment Date. EBITDA of the Company and its consolidated Subsidiaries
shall be determined based upon (a) in the case of calculations relating to
the fiscal quarter ending March 31, 1998, the consolidated financial
statements of the Company and its consolidated Subsidiaries for the fiscal
quarters ending December 31, 1997 and March 31, 1998 with EBITDA
determined for such two fiscal quarter period and multiplied by two, (b)
in the case of calculations relating to the fiscal quarter ending June_30,
1998, the consolidated financial statements of the Company and its
consolidated Subsidiaries for the fiscal quarters ending December 31,
1997, March 31, 1998 and June_30, 1998 with EBITDA determined for such
three fiscal quarter period and multiplied by 1.33, and (c) thereafter,
the preceding four fiscal quarter period. Any change in the Applicable
Margin shall be effective on the Margin Adjustment Date and will apply to
all Loans outstanding as of such date.
Arranger means Bank One Capital Markets, a division of Banc One
Corporation.
Assignee has the meaning specified in subsection 11.08(a).
Assignment of Intercompany Security Agreements means the
Assignment of Intercompany Security Agreements executed by the Company in
substantially the form of Exhibit L.
Attorney Costs means and includes all reasonable fees and
disbursements of any law firm or other external counsel.
Bank has the meaning specified in the introductory clause hereto.
References to the Banks shall include Bank One, including in its
capacity as Issuing Bank; for purposes of clarification only, to the
extent that Bank One may have any rights or obligations in addition to
those of the Banks due to its status as Issuing Bank, its status as such
will be specifically referenced.
Bank One means Bank One, Wisconsin, a Wisconsin banking
corporation, and its successors.
Bankruptcy Code means the Federal Bankruptcy Reform Act of 1978
(11 U.S.C. Section 101, et seq.).
Base Rate means, for any day, the higher of: (a) 0.50% per annum
above the latest Federal Funds Rate; and (b) the Reference Rate for such
day.
Base Rate Loan means a Loan that bears interest based on the Base
Rate.
Borrowing means a borrowing hereunder consisting of Revolving
Loans of the same Type made to the Company on the same day by the Banks
under Article II, and, in the case of LIBOR Rate Loans, having the same
Interest Period.
Borrowing Base Amount means, on any day, an amount equal to:
(a) 80% of Qualified North American Accounts Receivable; plus
(b) 50% of the lesser of cost or wholesale market value of
Qualified Domestic Finished Goods and Raw Materials Inventory (provided
that spare parts inventory included by the Company in its calculation of
the Obsolescence Reserve and which constitute a portion of Qualified
Domestic Finished Goods and Raw Materials Inventory shall be deemed to
have a cost equal to 50% of the value attributed to it by the Company in
calculating the Obsolescence Reserve; provided further that if the Company
makes any material change in the manner in which it calculates the
Obsolescence Reserve, the Agent shall, if so directed by the Majority
Banks, reduce the percentage used to determine the deemed cost of such
spare parts inventory (so as to cause such deemed cost to be, in the
good faith evaluation of the Agent, approximately equal to the deemed
cost which would have existed absent such change in the manner of
calculating the Obsolescence Reserve) by written notice to the Company and
such reduced percentage shall be immediately effective; and provided
further that if an ABL Trigger Event has occurred and is continuing, the
Agent may, in its discretion exercised in good faith through the
application of appropriate criteria generally used by asset-based lenders
in determining the property of a borrower eligible for inclusion in a
borrowing base, reduce the percentage used to determine the deemed cost
of such spare parts inventory by written notice to the Company and such
reduced percentage shall be immediately effective); plus
(c) the Qualified Domestic Work in Process Inventory Borrowing
Base Amount; plus
(d) the Machinery and Equipment Borrowing Base Amount; plus
(e) the Qualified Domestic Net Unbilled Progress Billing Amount;
minus
(f) the 1997 Senior Note Interest Reserve.
The amounts under clauses (a) -- (e) above shall be based upon the most
recent Borrowing Base Certificate furnished by the Company under
subsection 7.02(c) as updated, to the extent applicable, by the
information provided under subsection 2.16(a).
Borrowing Base Certificate means a certificate substantially in
the form of Exhibit G.
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 Milwaukee, Wisconsin or New York City are
authorized or required by law to close and, if the applicable Business Day
relates to any LIBOR Rate Loan, means such a day on which dealings are
carried on in the applicable LIBOR dollar interbank market.
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, as to any Person and for any period
for which such amount is being determined, expenditures during such period
by such Person (on a consolidated basis) for the purchase or other
acquisition of fixed or capital assets (excluding normal replacements and
maintenance which are properly chargeable to current operations).
Cash Collateralize means to pledge and deposit with or deliver to
the Agent, for the benefit of the Agent, the Issuing Bank and the Banks,
as additional collateral for the Obligations, cash or deposit account
balances pursuant to documentation in form and substance satisfactory to
the Agent and the Issuing Bank (which documents are hereby consented to by
the Banks). Derivatives of such term shall have corresponding meaning.
The Company hereby grants the Agent, for the benefit of the Agent, the
Issuing Bank and the Banks, a security interest in all such cash and
deposit account balances. Cash collateral shall be maintained in blocked,
interest bearing deposit accounts at Bank One.
Change of Control shall have the meaning assigned to such term in the
Senior Note Indenture as in effect on the Closing Date.
Closing Date means the date on which all conditions precedent set forth
in Section 5.01 are satisfied or waived by all Banks (or, in the case of
subsection 5.01(o), waived by the Person entitled to receive such
payment).
Code means the Internal Revenue Code of 1986, and regulations
promulgated thereunder.
Commitment , as to each Bank, has the meaning specified in Section 2.01.
Company Pledge Agreement means the Pledge Agreement executed by the
Company in substantially the form of Exhibit I.
Company Security Agreement means the Security Agreement executed by the
Company in substantially the form of Exhibit H.
Compliance Certificate means a certificate substantially in the form of
Exhibit_C.
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.
Comfort letters issued by the Company to creditors of a Subsidiary in
which the Company expresses its intention to maintain ownership of the
relevant Subsidiary are not Contingent Obligations for purposes of this
Agreement.
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.
Conversion/Continuation Date means any date on which, under
Section_2.04, the Company (a) converts Loans of one Type to another Type,
or (b)_continues as Loans of the same Type, but with a new Interest
Period, Loans having Interest Periods expiring on such date.
Credit Extension means and includes (a) the making of any Loans
hereunder, and (b) the Issuance of any Letters of Credit hereunder
(including the Existing Bank One Letters of Credit).
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.
Dollars , dollars and $ each mean lawful money of the United States.
EBITDA means for any Person and for any period for which such amount is
being determined, the sum of the amounts (on a consolidated basis) for
such period of (a) Net Earnings and (b) to the extent deducted in
determining Net Earnings, (i) interest expense, (ii) provisions for taxes
based on income, and (iii)_depreciation, amortization and other, similar
noncash charges; provided that in determining EBITDA for the Company (i)
noncash charges incurred with respect to compensation paid in stock, or
options to acquire stock, of the Company shall be included in clause (b)
(iii) above, (ii) any foreign currency translation loss (or gain, as the
case may be) shall be added to (in the case of a loss) or subtracted from
(in the case of a gain) Net Earnings, (iii) only management fees and other
amounts paid by the Company or one of its Subsidiaries to AIP or one of
its Affiliates in cash shall be taken into account in determining EBITDA
and any such fees or other amounts accrued but not paid in cash shall be
disregarded, (iv)_inventory fair value adjustments related to purchase
accounting and other noncash charges and adjustments made on account of
the Xxxxxx Acquisition and AIP Purchase shall be disregarded, (v) the
costs and expenses incurred by the Company and its Subsidiaries to convert
software to adapt to the year 2000 shall be disregarded, (vi) amounts paid
by the Company to effect the Option Repurchase shall be disregarded and
(vii) the fees paid by the Company in connection with obtaining and
extending the commitment for the PPM Bridge Loan Facility, and the fees
paid by the Company in connection with the making of the PPM Bridge Loan
Facility, shall be disregarded.
Effective Amount means (i) with respect to any Loans on any date, the
aggregate outstanding principal amount thereof after giving effect to any
Borrowings and prepayments or repayments of Loans occurring on such date;
and (ii) with respect to any outstanding L/C Obligations on any date, the
amount of such L/C 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 L/C 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; and (c) a Person that is
primarily engaged in the business of commercial banking and that is (i) a
Subsidiary of a Bank, (ii) a Subsidiary of a Person of which a Bank is a
Subsidiary, or (iii) a Person of which a Bank is a Subsidiary.
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.
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.
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 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.
Eurodollar Reserve Percentage has the meaning specified in the
definition of LIBOR Rate .
Event of Default means any of the events or circumstances specified in
Section 9.01.
Exchange Act means the Securities Exchange Act of 1934, and regulations
promulgated thereunder.
Existing Bank One Credit Agreement means the Credit Agreement dated as
of December 14, 1994, as amended, between the Company and Bank One.
Existing Bank One Letters of Credit means the letters of credit
described in Schedule 3.03.
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. (New York City time) on that day by each of three leading brokers of
Federal funds transactions in New York City selected by the Agent.
Fee Letter has the meaning specified in subsection 2.10(a).
Financial Letter of Credit means a Letter of Credit which is not a
Nonfinancial Letter of Credit.
Fixed Charge Coverage Ratio means the relationship, expressed as a
numerical ratio, between:
(a) EBITDA minus interest income; and
(b) the sum of (i) interest expense net of interest income, (ii) taxes
based on income to the extent paid in cash net of income tax refunds
received in cash and (iii) principal payments (but not prepayments) made
with respect to Funded Debt (excluding (1) any repayment by Bucyrus
Europe, Ltd. of its Indebtedness to National Westminster Bank, (2)_all
repayments by foreign Subsidiaries of overdraft facilities provided to
such foreign Subsidiaries (3) the repayment of Indebtedness of Von s
Welding, Inc. in existence at the time it became a Subsidiary of the
Company, (4) the repayment by Bucyrus (Australia) Proprietary, Ltd. of
existing Indebtedness incurred to finance the purchase of blast hole
drills leased to its customers and (5) the repayment by the Company of the
1994 Secured Notes, the PPM Bridge Loan Facility, the loans outstanding
under the Existing Bank One Credit Agreement, the AIP Bridge Loan and the
project financing loans provided by Mitsubishi in connection with the
Benxi project);
all as determined for the Company and its consolidated Subsidiaries for the
12-month period preceding the date of determination, excluding therefrom,
however, any results attributable to the operation of the properties
acquired in the Xxxxxx Acquisition before August 26, 1997.
FRB means the Board of Governors of the Federal Reserve System, and any
Governmental Authority succeeding to any of its principal functions.
Funded Debt means, for any Person and for any period for which such
amount is being determined, the sum, without duplication, of the amounts
for such period of (a) Indebtedness (other than that described in clause
(h) of the definition of Indebtedness and other than that described in the
second paragraph of the definition of Indebtedness except to the extent a
demand for payment of any such Indebtedness has been made of the Company),
(b) the aggregate drawn amount of all outstanding Letters of Credit, (c)
the aggregate amount of payments which such Person is obligated to pay
with respect to its preferred stock and (d) the aggregate amount of
obligations with respect to capital leases.
GAAP means generally accepted accounting principles set forth from time
to time in the opinions and pronouncements of the Accounting Principles
Board, SEC 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.
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.
Guaranty Obligation has the meaning specified in the definition of
Contingent Obligation.
Honor Date has the meaning specified in subsection 3.03(c).
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; (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 bank 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)
all indebtedness referred to in clauses (a) through (f) 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 contracts rights) owned by such Person, even
though such Person has not assumed or become liable for the payment of
such Indebtedness; and (h) all Guaranty Obligations in respect of
indebtedness or obligations of others of the kinds referred to in clauses
(a) through (g) above.
For all purposes of this Agreement, (i) 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 and (ii) the obligations of the Company arising
in connection with service agreements with the prior owners of Boonville
Mining Services, Inc. and Von s Welding, Inc. shall not be Indebtedness.
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 subsection 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,
marshalling 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.
Intercompany Note means each demand promissory note executed by a
Subsidiary Guarantor payable to the order of the Company and any note
issued in exchange therefor or as a replacement thereof, in each case as
amended, revised, supplemented or restated from time to time.
Intercompany Security Agreement means a Security Agreement executed by
a Subsidiary Guarantor for the benefit of the Company in substantially the
form of Exhibit M.
Interest Coverage Ratio means the relationship, expressed as a numerical
ratio, between:
(a) EBITDA minus interest income; and
(b) interest expense net of interest income;
as determined for the Company and its consolidated Subsidiaries for the
12-month period preceding the date of determination, excluding therefrom,
however, any results attributable to the operation of the properties
acquired in the Xxxxxx Acquisition before August 26, 1997.
Interest Payment Date means, as to a LIBOR Rate Loan, the last day of
each Interest Period applicable to such Loan and, as to any Base Rate
Loan, the last Business Day of each month and each date such Loan is
converted into a LIBOR Rate Loan, provided, however, that if any Interest
Period for a LIBOR Rate Loan exceeds three months, the date that falls
three months after the beginning of such Interest Period is also an
Interest Payment Date.
Interest Period means the period commencing on the Borrowing Date of a
LIBOR Rate Loan or on the Conversion/Continuation Date on which the Loan
is converted into or continued as an LIBOR Rate Loan, and ending on the
date one, two, three or six months thereafter as selected by the Company
in its Notice of Borrowing or Notice of Conversion/Continuation;
provided that:
(i) if any Interest Period would otherwise end on a day that is
not a Business Day, that Interest Period shall be extended to the
following Business Day unless the result of such extension would be
to carry such Interest Period into another calendar month, in which
event such Interest Period shall end on the preceding Business Day;
(ii) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at
the end of such Interest Period; and
(iii) no Interest Period for any Loan shall extend beyond the
Revolving Termination Date.
IRS means the Internal Revenue Service, and any Governmental Authority
succeeding to any of its principal functions under the Code.
Issuance Date has the meaning specified in subsection 3.01(a).
Issue means, with respect to any Letter of Credit, to incorporate the
Existing Bank One Letters of Credit into this Agreement, or 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 Bank means Bank One in its capacity as issuer of one or more
Letters of Credit hereunder, together with any replacement letter of
credit issuer arising under subsection 10.01(b) or Section 10.09.
Joint Venture means a single-purpose corporation, partnership, limited
liability company, joint venture or other 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.
L/C Advance means each Bank'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 Bank, as the Issuing Bank 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 Bank, as the Issuing Bank 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
subsection 3.03(c).
L/C Commitment means the commitment of the Issuing Bank to Issue, and
the commitment of the Banks severally to participate in, Letters of Credit
(including the Existing Bank One 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 $25,000,000, as the same shall be reduced
as a result of a reduction in the L/C Commitment pursuant to Section 2.05
or Section_2.07; provided that the L/C Commitment is a part of the
combined 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 Bank's standard form
documents for letter of credit issuances.
Lending Office means, as to any Bank, the office or offices of such Bank
specified as its Lending Office or Domestic Lending Office or LIBOR
Lending Office , as the case may be, on Schedule 11.02, or such other
office or offices as such Bank may from time to time notify the Company
and the Agent.
Letters of Credit means the Existing Bank One Letters of Credit and any
letters of credit (whether standby letters of credit or commercial
documentary letters of credit) Issued by the Issuing Bank pursuant to
Article III.
LIBOR Rate means, for any Interest Period, with respect to LIBOR Rate
Loans comprising part of the same Borrowing, the rate of interest per
annum (rounded upward to the next 1/16th of 1%) determined by the Agent as
follows:
LIBOR Rate = LIBOR
1.00 - Eurodollar Reserve Percentage
Where,
Eurodollar Reserve Percentage means for any day for any Interest Period
the maximum reserve percentage (expressed as a decimal, rounded
upward to the next 1/100th of 1%) in effect on such day (if
applicable to any Bank) under regulations issued from time to time
by the FRB for determining the maximum reserve requirement
(including any emergency, supplemental or other marginal reserve
requirement) with respect to Eurocurrency funding (currently
referred to as Eurocurrency liabilities ); and
LIBOR means the rate of interest per annum determined by the Agent
to be the rate of interest per annum at which dollar deposits in the
approximate amount of the Loan to be made or continued as, or
converted into, an LIBOR Rate Loan and having a maturity comparable
to such Interest Period would be offered by the Agent to major banks
in the London interbank market at their request at approximately
11:00 a.m. (London time) two Business Days prior to the commencement
of such Interest Period.
The LIBOR Rate shall be adjusted automatically as to all LIBOR Rate
Loans then outstanding as of the effective date of any change in the
Eurodollar Reserve Percentage.
LIBOR Rate Loan means a Loan that bears interest based on the LIBOR
Rate.
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 Bank to the Company under Article
II or Article III in the form of a Revolving Loan or L/C Advance.
Loan Documents means this Agreement, any Notes, the Security Documents,
the Subsidiary Guaranties, the Fee Letter, the L/C-Related Documents, and
all other documents delivered to the Agent or any Bank in connection
herewith.
Machinery and Equipment Borrowing Base Amount means an amount equal to
the greater of $20,000,000 or 80% of the sum of:
(a) $48,788,965 minus the appraised value of any machinery or
equipment included in the appraisal referred to in Section 5.01(f) which
is sold or otherwise disposed of, multiplied by 100% during the period
from the Closing Date through December_30, 1997 and such percentage shall
reduce by 3.57% on December_31, 1997 and on the last day of each
subsequent fiscal quarter ; and
(b) as of each March_31, June_30, September_30 and December_31,
commencing September_30, 1997, the aggregate purchase price of machinery
and equipment purchased by the Company or by a Subsidiary Guarantor during
the preceding 3-month period and in which the Agent has a perfected, first
priority security interest (the Quarterly M&E Additions );
provided, however, that, for purpose of calculating the amount under clause
(b) above, the Quarterly M&E Additions for each quarter shall be
multiplied by 100% during the first quarter and such percentage shall
reduce by 3.57% as of the last day of each subsequent fiscal quarter. The
Quarterly M&E Additions do not include the property acquired pursuant to
the Xxxxxx Acquisition.
Majority Banks means at any time Banks then holding at least 66-2/3% of
the then aggregate unpaid principal amount of the Loans, or, if no such
principal amount is then outstanding, Banks then having at least 66-2/3%
of the Commitments.
Margin Stock means margin stock as such term is defined in Regulation
G, T, U or X of the FRB.
Xxxxxx means The Xxxxxx Power Shovel Company, a Delaware corporation.
Xxxxxx Acquisition means the purchase by the Company and certain of its
foreign Subsidiaries of substantially all of the assets, and the
assumption of certain of the liabilities, of Xxxxxx and certain other
subsidiaries of Global Industrial Technologies, Inc. engaged in the
business of designing, manufacturing and selling draglines, power shovels
and drills for surface mining and related activities.
Xxxxxx Acquisition Documents means the Asset Purchase Agreement dated as
of July_21, 1997 by and among Xxxxxx, certain affiliated corporations,
Global Industrial Technologies, Inc., the Company and certain of the
Company s foreign Subsidiaries, all exhibits and schedules thereto, and
all other instruments and agreements, executed in connection with the
consummation of the transactions contemplated thereby.
Material Adverse Effect means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties or
condition (financial or otherwise) 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 Guarantor 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 Guarantor of any Loan Document.
Material Domestic Subsidiary means, at any time, any domestic Subsidiary
(other than Western Gear Machinery Co.) having at such time either
(i)_total (gross) revenues for the preceding four fiscal quarter period in
excess of $10,000,000 or (ii) total assets, as of the last day of the
preceding fiscal quarter, having a net book value in excess of $1,000,000,
in each case, based upon the Company's most recent annual or quarterly
financial statements delivered to the Agent under Section 7.01.
Material Foreign Subsidiary means Bucyrus Canada Limited, Bucyrus Chile
Limitada, Wisconsin Holdings Proprietary Ltd. and Bucyrus (Australia)
Proprietary Ltd., and each of their successors.
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.
1994 Secured Notes means the Secured Notes Due December 14, 1999 issued
by the Company under the Indenture dated as of December 14, 1994 between
the Company and Xxxxxx Trust and Savings Bank, as trustee.
1997 Senior Note Documents means the Senior Note Indenture, the 1997
Senior Notes and all other instruments and agreements provided in
connection with the issuance of the 1997 Senior Notes by the Company.
1997 Senior Notes means the 9-3/4% Senior Notes Due 2007 issued by the
Company under the Indenture dated as of September_24, 1997 (the Senior
Note Indenture ) among the Company, the Subsidiary Guarantors and Xxxxxx
Trust and Savings Bank, as trustee.
1997 Senior Note Interest Reserve means, initially an amount equal to
the semiannual interest payment due on the 1997 Senior Notes and, if the
Company receives Revolving Loans to make an interest payment on the Senior
Notes under subsection_2.03(e), the 1997 Senior Note Interest Reserve
shall reduce to $0 on the applicable Borrowing Date and shall increase on
the last Business Day of the month of such Borrowing Date, and on the last
Business Days of the four succeeding months, by an amount equal to 1/5th
of the next semiannual interest payment due on the 1997_Senior Notes.
Net Earnings means, as to any Person and for any period, the net income
of such Person (on a consolidated basis), excluding extraordinary gains
and extraordinary losses, after the payment or provision for payment of
all income and other applicable taxes, and the cumulative effect of
changes in GAAP.
Net Proceeds means (i) in the case of the sale, transfer or other
disposition of assets (other than the sale of inventory in the ordinary
course of business), the cash payments received (including any cash
payments received by way of deferred payment of principal pursuant to a
note receivable or otherwise, but only when and as received, but excluding
any consideration received in the form of the assumption of Indebtedness
or in any noncash form and excluding any insurance proceeds received as a
result of the damage or destruction of assets) therefrom, in each case net
of (a) all legal, title and recording tax expenses, commissions and other
fees and expenses incurred and all taxes required to be paid as a result
of such sale, transfer or other disposition and (b) all payments made on
any Indebtedness (other than the Obligations) secured by such assets, and
(ii) in the case of the issuance or sale of capital stock, the cash
proceeds of such issuance or sale net of attorneys fees, accountants
fees, underwriters fees, discounts and commissions and other fees and
expenses actually incurred in connection with such sale or issuance.
Notwithstanding the foregoing, amounts realized by the Company or any
Subsidiary Guarantor from (1) the sale of assets which are deemed by the
Company to be surplus as a result of the Xxxxxx Acquisition, (2) the sale
of assets rendered surplus or obsolete by the Company s plant
modernization program, (3) the sale of other assets to the extent that, no
later than 360 days after receipt of the sale proceeds, the Company or the
applicable Subsidiary Guarantor reinvests such proceeds in the other
property or assets to be used by the Company or the applicable Subsidiary
Guarantor in its business operations, (4) the sale of assets not within
any of the foregoing clauses (1), (2) and (3) to the extent that such
proceeds do not exceed $1,500,000 during any 12-month period, (5) the
issuance or sale by the Company of capital stock if, as of the date of
such issuance or sale, either [A] no ABL Trigger Event has occurred and is
continuing, [B] an ABL Trigger Event has occurred and is continuing, and
the Company provides to the Banks such pro forma financial information and
related analyses as the Banks may reasonably request which establish, in
the good faith determination of the Banks, that had such proceeds been
available to the Company during the relevant measurement period the ABL
Trigger Event would not have occurred and that no ABL Trigger Event will
occur during the period ending on the last day of the second fiscal
quarter after the date of such stock issuance or sale, or [C]_the Majority
Banks consent to excluding such amounts from Net Proceeds, or (6) the
issuance by the Company on any date of capital stock to employees pursuant
to incentive compensation plans, shall not be deemed to be Net Proceeds
for purposes of subsection_2.07(b).
Net Worth means, for any Person as of the date, an amount (on a
consolidated basis) equal to the total assets of such Person less the
total liabilities of such Person; provided that for purposes of
calculating the Net Worth of the Company and its consolidated Subsidiaries
the Net Worth of Equipment Assurance Ltd. shall not be less than_$0.
Nonfinancial Letter of Credit means a Letter of Credit which the Agent
determines qualifies for a 50 percent conversion factor as set forth in
section_III.D.2 of Appendix_A to 12 CFR Part 208 issued by the FRB with
respect to Capital Adequacy Guidelines.
Note means a promissory note executed by the Company in favor of a Bank
pursuant to subsection 2.02(b) in substantially the form of Exhibit F.
Notice of Borrowing means a notice in substantially the form of Exhibit_A.
Notice of Conversion/Continuation means a notice in substantially the
form of Exhibit B.
Obligations means all advances, debts, liabilities, obligations,
covenants and duties arising under any Loan Document owing by the Company
or any Subsidiary Guarantor to any Bank, the Agent, the Issuing Bank or
any Indemnified Person, whether direct or indirect (including those
acquired by assignment under Section_11.08), absolute or contingent, due
or to become due, now existing or hereafter arising.
Obsolescence Reserve means the reserve for obsolete inventory
established from time to time by the Company in accordance with the Policy
Statement attached hereto as Exhibit N as amended from time to time as
permitted by Section_8.14.
Option Repurchase means the repurchase, redemption, retirement or other
acquisition by the Company of options and stock appreciation rights with
respect to the Company s common stock and restricted stock of the Company
which occurs as a component of the AIP Purchase.
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
(excluding taxes based upon income) 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 subsection 11.08(d).
PBGC means the Pension Benefit Guaranty Corporation, or any Governmental
Authority succeeding to any of its principal functions under ERISA.
PECFA Loan means the loan made by Bank One to the Company pursuant to
section_2.6 of the Existing Bank One Credit Agreement.
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 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 to which a Bank is a counterparty, 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.
PPM Bridge Loan Facility means the Bridge Loan Agreement dated August
26, 1997 by and among PPM America Special Investments Fund, L.P., as agent
and a lender, the other lenders party thereto, the Company, Bucyrus
(Australia) Proprietary Ltd. and Bucyrus Canada Limited.
Progress Payment Invoices means invoices issued by the Company or a
Subsidiary Guarantor to a purchaser of a product being manufactured, or to
be manufactured, by the Company or such Subsidiary Guarantor in accordance
with the terms of the purchase order, letter of intent or similar binding
document submitted by the purchaser of such product.
Pro Rata Share means, as to any Bank at any time, the percentage
equivalent (expressed as a decimal, rounded to the ninth decimal place) at
such time of such Bank's Commitment divided by the combined Commitments of
all Banks.
Qualified Domestic Finished Goods and Raw Materials Inventory means
finished goods and raw materials inventory owned by the Company or a
Subsidiary Guarantor located in the United States or, in the case of
certain finished goods inventory, in Iqueque, Chile free trade zone or in
Canada (a) in which the Agent has a valid, perfected first priority
security interest and which is subject to no other Lien, (b) which is of
good and merchantable quality free from any defect which would affect the
market value thereof, (c) which does not consist of returned goods or
damaged, obsolete or slow-moving inventory (unless and to the extent that
such obsolete or slow-moving inventory is included by the Company in its
calculation of the Obsolescence Reserve), (d) the creation or production
of which (in the case of finished goods inventory) was done in compliance
with the Federal Fair Labor Standards Act and the rules and regulations
adopted thereunder and (e) as to which the Agent has not notified the
Company, after the occurrence and during the continuance of any ABL
Trigger Event, that the particular type or item of inventory is
unsatisfactory in the good faith determination of the Agent through the
application of appropriate criteria generally used by asset-based lenders
in determining the property of a borrower eligible for inclusion in a
borrowing base. Any Qualified Domestic Finished Goods and Raw Materials
Inventory which ceases to meet any of the foregoing requirements shall
cease to be Qualified Domestic Finished Goods and Raw Materials Inventory
at such time.
Qualified Domestic Net Unbilled Progress Billing Receivables means the
amount (net of all advance payments made by the applicable customer under
the applicable contract) which the Company has, in accordance with GAAP
and consistent with the past practices of the Company, reflected as an
asset on its balance sheet as the cost of work in process inventory which
has not yet been billed to the applicable customer.
Qualified Domestic Net Unbilled Progress Billing Amount means an amount
equal to 30% of Qualified Domestic Net Unbilled Progress; provided,
however, that on each of the first two annual anniversaries of the Closing
Date the Agent may, in its discretion, reduce the percentage advance rate
by not more than five percentage points.
Qualified Domestic Work in Process Inventory means work in process
inventory owned by the Company or a Subsidiary located in the United
States (a) in which the Agent has a valid, perfected first priority
security interest and which is subject to no other Lien, (b) which is of
good and merchantable quality free from any defect which would affect the
market value thereof, (c) which does not consist of returned goods or
damaged, obsolete or slow-moving inventory, (d) the creation or production
of which was done in compliance with the Federal Fair Labor Standards Act
and the rules and regulations adopted thereunder, (e) which is not in
transit to a foreign Subsidiary, (f) which is not inventory created in
connection with (i) any Qualified Domestic Net Unbilled Progress Billing
Receivable, (ii) any service order or (iii) any accommodation order
and (g) as to which the Agent has not notified the Company, after the
occurrence and during the continuance of any ABL Trigger Event, that the
particular type or item of inventory is unsatisfactory in the good faith
determination of the Agent through the application of appropriate criteria
generally used by asset-based lenders in determining the property of a
borrower eligible for inclusion in a borrowing base. Any Qualified
Domestic Work in Process Inventory which ceases to meet any of the
foregoing requirements shall cease to be Qualified Domestic Work in
Process Inventory at such time.
Qualified Domestic Work in Process Inventory Borrowing Base Amount means
(a) during the period from the Closing Date to the first anniversary of
the Closing Date, an amount equal to 30% of Qualified Domestic Work in
Process Inventory, (b) during the next 12-month period, an amount equal to
25% of Qualified Domestic Work in Process Inventory and (c) thereafter, an
amount equal to 20% of Qualified Domestic Work in Process Inventory.
Qualified Domestic Work in Process Inventory shall be valued at cost in
accordance with GAAP.
Qualified North American Accounts Receivable means a trade account
receivable (excluding all progress xxxxxxxx other than Progress Payment
Invoices) owed to the Company or to a Subsidiary Guarantor (a) by an
account debtor other than an Affiliate, (b) which arose out of the
performance of services by such Person or from a bona fide sale or lease
of goods which have been delivered or shipped to the account debtor and
for which such Person has genuine invoices, shipping document or receipts,
(c) which is not more than 61 days past due from the original due date of
the relevant invoice and which original due date was not more than (i) 30
days after the date of the relevant invoice (or such longer period, not in
excess of one year, as the Company or a Subsidiary Guarantor has
customarily provided for that particular account debtor) for account
debtors located in the United States and (ii) 60_days after the date of
the relevant invoice (or such longer period, not in excess of one year, as
the Company or a Subsidiary Guarantor has customarily provided for that
particular account debtor) for foreign account debtors, (d) in which the
Agent has a valid, perfected first priority security interest and which is
subject to no other Lien, (e) which is enforceable against the account
debtor without setoff, credit, allowance or discount, except discount for
prompt payment, (f) which, together with the transactions out of which it
arose, complies with all applicable laws and regulations, (g) which has
not been classified as Claim status by the Company, (h) as to which the
Company has no knowledge of anything which might cause the account debtor
to be unable to pay the account, (i) as to which the account debtor has
not disputed its liability or returned or threatened to return the goods,
(j) by an account debtor which is not more than 90_days past due in the
payment of more than 50% of the aggregate amount (excluding amounts owed
under retainage provisions of the underlying contract) owed by such
account debtor to the Company and such Subsidiaries, (k) which, after the
occurrence and during the continuance of an ABL Trigger Event, is not an
account with respect to which a Service and Erection Accrual exists
(provided that if the amount of such account exceeds the related Service
and Erection Accrual for that account, such excess shall continue to be
qualified under this clause) and (l) as to which the Agent has not
notified the Company, after the occurrence and during the continuance of
any ABL Trigger Event, that the account or account debtor is
unsatisfactory in the good faith determination of the Agent through the
application of appropriate criteria generally used by asset-based lenders
in determining the property of a borrower eligible for inclusion in a
borrowing base. Any Qualified North American Account Receivable which
ceases to meet any of the foregoing requirements shall cease to be a
Qualified North American Account Receivable at such time.
In the case of a Progress Payment Invoice, the requirements of clause (b)
in the preceding paragraph shall not apply and, in lieu of the
requirements of clause (c) of the preceding paragraph, such Progress
Payment Invoice must be due and payable upon receipt and the amount of
such Progress Payment Invoice must not be unpaid more than 61_days after
its date.
Reference Rate means the rate of interest announced from time to time
by Bank One as its base rate for interest rate determinations. The
Reference Rate may or may not be the lowest rate charged by Bank One for
commercial loans.
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 or the president
of the Company, or any other officer having substantially the same
authority and responsibility; or, with respect to compliance with
financial covenants, the chief financial officer, the treasurer, the
assistant treasurer or controller of the Company, or any other officer
having substantially the same authority and responsibility.
Revolving Loan has the meaning specified in Section 2.01 and may be a
Base Rate Loan or a LIBOR Rate Loan (each, a Type of Revolving Loan).
Revolving Termination Date means the earlier to occur of:
(a) September_24, 2000; and
(b) the date on which the Commitments terminate in accordance with
the provisions of this Agreement;
provided, however, that the Revolving Termination Date may be extended to a
later date than the one specified in clause (a) above if requested by the
Company and consented to, in writing, by all the Banks.
SEC means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
Security Documents means the Company Security Agreement, the Company
Pledge Agreement, the Assignment of Intercompany Security Agreements, the
Subsidiary Guarantor Security Agreements, the Intercompany Security
Agreements and any other instrument or agreement provided by the Company
or a Subsidiary Guarantor to the Agent as security for the payment of the
Obligations.
Service and Erection Accrual means the amount so identified on the
financial statements of the Company and its consolidated Subsidiaries as
a liability relating to the Company s and the Subsidiary Guarantor s
obligations to its customers for erection, training and initial service of
machine purchases but, excluding any such accrual which is not an
obligation of the Company or a Subsidiary Guarantor.
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 Guarantor means Minserco, Inc., Boonville Mining Services,
Inc. and each other Subsidiary which is required under Section_7.14_to
execute a Subsidiary Guaranty and any successor or assign thereof.
Subsidiary Guarantor Security Agreement means a Security Agreement
executed by a Subsidiary Guarantor in substantially the form of Exhibit K.
Subsidiary Guaranty means a Guaranty Agreement executed by a Subsidiary
Guarantor in substantially the form of Exhibit J.
Surety Instruments means all letters of credit (including standby and
commercial), 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 Bank).
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 Bank
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 Bank or the Agent, as the case may be, is organized
or maintains a lending office.
Type has the meaning specified in the definition of Revolving Loan.
Unfunded Pension Liability means the excess of a Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, determined in accordance
with the assumptions used for funding the Pension Plan pursuant to Section
412 (b) of the Code over the market value of that Plan s assets for the
applicable plan year.
United States and U.S. each means the United States of America.
Wholly-Owned Subsidiary means any corporation in which (other than
directors' qualifying shares required by law) 100% of the capital stock of
each class having ordinary voting power, and 100% of the capital stock 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.
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 subsection, 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.
(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 Banks 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 Banks or the Agent merely because of the Agent's or
Banks' 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.
(b) References herein to fiscal year and fiscal quarter refer to
such fiscal periods of the Company.
ARTICLE II
THE CREDITS
2.01 Amounts and Terms of Commitments. Each Bank severally agrees, on the
terms and conditions set forth herein, to make loans to the Company (each such
loan, a Revolving Loan ) from time to time on any Business Day during the
period
from the Closing Date to the Revolving Termination Date, in an aggregate amount
not to exceed at any time outstanding the amount set forth on Schedule 2.01
(such
amount, as the same may be reduced under Section 2.05 or Section 2.07 or as a
result of one or more assignments under Section 11.08, such Bank's
Commitment );
provided, however, that, after giving effect to any Borrowing of Revolving
Loans,
the sum of the Effective Amount of all outstanding Revolving Loans and the
Effective Amount of all L/C Obligations shall not at any time exceed the lesser
of (a) the Borrowing Base Amount or (b) an amount equal to the combined
Commitments minus (unless otherwise agreed to by the Majority Banks) the
1997_Senior Note Reserve after giving effect to the requested Borrowing; and
provided further, that the Effective Amount of the Revolving Loans of any Bank
plus the participation of such Bank in the Effective Amount of all L/C
Obligations
shall not at any time exceed such Bank's Commitment. Within the limits of each
Bank's Commitment, and subject to the other terms and conditions hereof, the
Company may borrow under this Section 2.01, prepay under Section 2.06 and
Section 2.07 and reborrow under this Section 2.01.
2.02 Loan Accounts. (a) The Loans made by each Bank and the Letters of
Credit Issued by the Issuing Bank shall be evidenced by one or more accounts or
records maintained by such Bank or Issuing Bank, as the case may be, in the
ordinary course of business. The accounts or records maintained by the
Agent, the Issuing Bank and each Bank shall be conclusive absent manifest
error of the amount of the Loans made by the Banks to the Company 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 hereunder to pay any amount owing with
respect to the Loans or any Letter of Credit.
(b) Upon the request of any Bank made through the Agent, the Loans
made by such Bank may be evidenced by one or more Notes, instead of or in
addition
to loan accounts. Each such Bank shall endorse on the schedules annexed to its
Note(s) the date, amount and maturity of each Loan made by it and the amount of
each payment of principal made by the Company with respect thereto. Each such
Bank is irrevocably authorized by the Company to endorse its Note(s) and each
Bank's record shall be conclusive absent manifest error; provided, however, that
the failure of a Bank 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
Company hereunder or under any such Note to such Bank.
2.03 Procedure for Borrowing. (a) Each Borrowing of Revolving Loans shall
be made upon the Company's 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. (Milwaukee, Wisconsin time) (i) three Business Days prior to
the requested Borrowing Date, in the case of LIBOR Rate Loans and (ii) on the
requested Borrowing Date, in the case of Base Rate Loans, specifying:
(A) the amount of the Borrowing, which shall be, in the case
of a LIBOR Rate Loan, in an aggregate minimum amount of $1,000,000
or any multiple of $1,000,000 in excess thereof and, in the case of
a Base Rate Loan, in an aggregate minimum amount of $500,000 or any
multiple of $100,000 in excess thereof;
(B) the requested Borrowing Date, which shall be a Business
Day;
(C) the Type of Loans comprising the Borrowing; and
(D) with respect to a Borrowing comprised (in whole or in
part) of LIBOR Rate loans only, the duration of the Interest Period
applicable to such Loans included in such notice. If the Notice of
Borrowing fails to specify the duration of the Interest Period for
any Borrowing comprised of LIBOR Rate Loans, such Interest Period
shall be one month.
Provided, however, that with respect to the Borrowing to be made on the Closing
Date, the Notice of Borrowing shall be delivered to the Agent not later than
1:00 p.m. (Milwaukee, Wisconsin time) on the Closing Date and such
Borrowing will consist of Base Rate Loans only.
(b) The Agent will promptly notify each Bank of its receipt of any
Notice of Borrowing, the amount of such Bank's Pro Rata Share of that Borrowing
and, if applicable, that such Borrowing will be used to make an interest payment
on the 1997 Senior Notes.
(c) Each Bank will make the amount of its Pro Rata Share of each
Borrowing available to the Agent for the account of the Company at the Agent's
Payment Office by 1:00 p.m. (Milwaukee, Wisconsin time) on the Borrowing Date
requested by the Company in funds immediately available to the Agent. The
proceeds of all such Loans will then be made available to the Company by
the Agent
at such office by crediting the account of the Company on the books of Bank One
with the aggregate of the amounts made available to the Agent by the Banks
and in like funds as received by the Agent.
(d) After giving effect to any Borrowing, unless the Agent shall
otherwise consent, there may not be more than four different Interest Periods in
effect.
(e) Notwithstanding subsection 2.03(a) and the last sentence of
subsection_2.03(c), if the Company desires Revolving Loans to pay interest
due on
the 1997_Senior Notes and, accordingly, reduce the 1997_Senior Note Reserve
to $0,
the Company shall so indicate in the applicable Borrowing Notice which shall
also
identify the trustee or paying agent for the 1997_Senior Notes to which such
amounts should be forwarded and include all necessary wire transfer
information.
The Agent shall wire transfer the proceeds of such Revolving Loans to the
specified trustee or paying agent on the Borrowing Date.
2.04 Conversion and Continuation Elections. (a) The Company may, upon
irrevocable written notice to the Agent in accordance with subsection 2.04(b):
(i) elect, as of any Business Day, to convert Base Rate Loans (or
any part thereof in an amount not less than $1,000,000, or that is in an
integral multiple of $1,000,000 in excess thereof) into LIBOR Rate Loans;
or
(ii) elect as of the last day of the applicable Interest Period, to
continue any LIBOR Rate Loans having Interest Periods expiring on such day
(or any part thereof in an amount not less than $1,000,000, or that is in
an integral multiple of $1,000,000 in excess thereof);
provided, that if at any time the aggregate amount of LIBOR Rate Loans in
respect
of any Borrowing is reduced, by payment, prepayment, or conversion of part
thereof
to be less than $1,000,000, such LIBOR Rate Loans shall automatically convert
into
Base Rate Loans, and on and after such date the right of the Company to continue
such Loans as LIBOR Rate Loans shall terminate.
(b) The Company shall deliver a Notice of Conversion/Continuation to
be received by the Agent not later than 11:00 a.m. (Milwaukee, Wisconsin
time) at least (i) three Business Days in advance of the Conversion/
Continuation Date, if the Loans are to be converted into or continued as
LIBOR Rate Loans; and (ii) on
the Conversion/Continuation Date, if the Loans are to be converted into
Base Rate Loans, specifying:
(A) the proposed Conversion/Continuation Date;
(B) the aggregate amount of Loans to be converted or
continued;
(C) the Type of Loans resulting from the proposed conversion
or continuation; and
(D) other than in the case of a conversion into Base Rate
Loans, the duration of the requested Interest Period.
(c) If upon the expiration of any Interest Period applicable to LIBOR
Rate Loans, the Company has failed to select timely a new Interest Period to be
applicable to such LIBOR Rate Loans, the Company shall be deemed to have elected
to convert such LIBOR Rate Loans into Base Rate Loans effective as of the
expiration date of such Interest Period.
(d) The Agent will promptly notify each Bank of its receipt of a
Notice of Conversion/Continuation, or, if no timely notice is provided by the
Company, the Agent will promptly notify each Bank of the details of
any automatic
conversion. All conversions and continuations shall be made ratably
according to
the respective outstanding principal amounts of the Loans with respect to which
the notice was given held by each Bank.
(e) Unless the Majority Banks otherwise consent, during the existence
of a Default or Event of Default, the Company may not elect to have a Loan
converted into or continued as an LIBOR Rate Loan.
(f) After giving effect to any conversion or continuation of Loans,
unless the Agent shall otherwise consent, there may not be more than four
different Interest Periods in effect.
2.05 Voluntary Termination or Reduction of Commitments. The Company may,
upon not less than three Business Days' prior notice to the Agent, terminate the
Commitments, or permanently reduce the Commitments by an aggregate minimum
amount
of $2,000,000 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, (a) the Effective Amount of all Revolving Loans and L/C Obligations
together would exceed the amount of the combined Commitments then in effect
minus (unless otherwise agreed to by the Majority Banks) the maximum
amount of the 1997
Senior Note Reserve, or (b) the Effective Amount of all L/C Obligations then
outstanding would exceed the L/C Commitment. Once reduced in accordance with
this
Section, the Commitments may not be increased. Any reduction of the Commitments
shall be applied to each Bank 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 Commitments shall be applied to reduce the L/C
Commitment. All accrued commitment and letter of credit fees to, but not
including, the effective date of any reduction or termination of Commitments,
shall be paid on the effective date of such reduction or termination.
2.06 Optional Prepayments. The Company may, at any time or from time to
time, upon irrevocable notice to the Agent which is received by the Agent no
later than 11:00_a.m. (Milwaukee, Wisconsin time) on the prepayment date,
ratably prepay
Base Rate Loans in whole or in part, in minimum amounts of $500,000 or any
multiple of $100,000 in excess thereof. Such notice of prepayment shall specify
the date and amount of such prepayment. The Agent will promptly notify each
Bank
of its receipt of any such notice, and of such Bank's Pro Rata Share of such
prepayment. If such notice is given by the Company, the Company 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.
2.07 Mandatory Prepayments of Loans; Mandatory Commitment Reductions. (a)
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 Aggregate L/C Commitment. Subject
to Section 4.04, 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 lesser of (i) the Borrowing Base Amount or (ii) the combined
Commitments minus (unless otherwise agreed to by the Majority Banks) the amount
of the 1997_Senior Note Reserve as of such date, 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 such excess.
(b) Upon receipt by the Company or any Material Domestic Subsidiary
of any Net Proceeds 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 lesser of (i) 75% of such Net Proceeds or (ii) the
outstanding principal amount of Revolving Loans and L/C Advances. On such date
the Commitments shall be reduced by an amount equal to 75% of such Net
Proceeds.
Once reduced in accordance with this subsection, the Commitments may not be
increased. Any reduction in the Commitments shall be applied to each Bank
according to its Pro Rata Share. If and to the extent specified by the Company
in a notice to the Agent, some or all of the reduction in the combined
Commitments shall be applied to reduce the L/C Commitment unless, after
giving effect thereto, the Effective Amount of all L/C Obligations
then outstanding would exceed the L/C Commitment.
All accrued commitment fees to, but not including, the effective date
of any such reduction of the Commitments shall be paid on the date of such
reduction.
2.08 Repayment. The Company shall repay to the Banks on the Revolving
Termination Date the aggregate principal amount of Revolving Loans and L/C
Borrowings outstanding on such date.
2.09 Interest. (a) Each Revolving Loan shall bear interest on the
outstanding principal amount thereof from the applicable Borrowing Date at a
rate
per annum equal to the LIBOR Rate or the Base Rate, as the case may be, plus the
Applicable Margin.
(b) Interest on each Revolving Loan shall be paid in arrears on each
Interest Payment Date. Interest shall also be paid on the date of any
prepayment
of Loans under Section 2.06 or 2.07 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 or with the consent of the Majority Banks.
(c) Notwithstanding subsection (a) of this Section, the Company 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 Loans at a rate per
annum equal to the rate applicable to each outstanding Loan as specified in
subsection (a) above plus_2%, (i) upon written notice to the Company from the
Agent, while any Event of Default exists and (ii) at all times after
acceleration of the maturity of the Notes.
(d) Anything herein to the contrary notwithstanding, the obligations
of the Company to any Bank 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 Bank would be contrary to the provisions
of any
law applicable to such Bank limiting the highest rate of interest that may be
lawfully contracted for, charged or received by such Bank, and in such event the
Company shall pay such Bank interest at the highest rate permitted by applicable
law.
2.10 Fees. In addition to certain fees described in Section 3.08:
(a) Arrangement, Agency Fees. The Company shall pay an arrangement
fee to the Arranger for the Arranger's own account, and shall pay an agency fee
to the Agent for the Agent's own account, as required by the letter agreement
( Fee Letter ) between the Company, the Arranger and the Agent dated August_13,
1997.
(b) Commitment Fees. The Company shall pay to the Agent for the
account of each Bank a commitment fee on the average daily unused portion of
such Bank's Commitment, computed on a quarterly basis in arrears on
the last Business Day of each calendar quarter based upon
the daily utilization for that quarter as
calculated by the Agent, equal to 1/2 of 1% per annum. For purposes of
calculating utilization under this subsection, 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. Such commitment
fee shall accrue from the Closing Date to the Revolving Termination Date and
shall
be due and payable quarterly in arrears on the last Business Day of each March,
June, September and December, commencing on September 30, 1997, through the
Revolving Termination Date, with the final payment to be made on the Revolving
Termination Date; provided that, in connection with any reduction or termination
of Commitments under Section 2.05 or Section 2.07, 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 quarterly payment being
calculated on the basis of the period from such reduction or termination date to
such quarterly payment date. The commitment fees provided in this subsection
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 fees and
interest shall be made on the basis of a 360-day year 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) Each determination of an interest rate by the Agent shall be
conclusive and binding on the Company and the Banks in the absence of manifest
error. The Agent will, at the request of the Company or any Bank, deliver to
the
Company or the Bank, as the case may be, a statement showing the quotations used
by the Agent in determining any interest rate and the resulting interest rate.
2.12 Payments by the Company. (a) All payments to be made by the Company
shall be made without set-off, recoupment or counterclaim. Except as otherwise
expressly provided herein, all payments by the Company shall be made to the
Agent
for the account of the Banks at the Agent's Payment Office, and shall be made in
dollars and in immediately available funds, no later than 12_noon (Milwaukee,
Wisconsin time) on the date specified herein. The Agent will promptly
distribute
to each Bank its Pro Rata Share (or other applicable share as expressly provided
herein) of such payment in like funds as received. Any payment received by the
Agent later than 12_noon (Milwaukee, Wisconsin time) shall be deemed to have
been
received on the following Business Day and any applicable interest or fee shall
continue to accrue.
(b) Subject to the provisions set forth in the definition of
Interest Period herein, 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.
(c) Unless the Agent receives notice from the Company prior to the
date on which any payment is due to the Banks that the Company will not make
such payment in full as and when required, the Agent may assume that
the Company 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 Bank on
such due date an amount equal to the amount
then due such Bank. If and to the extent the Company has not made such payment
in full to the Agent, each Bank shall repay to the Agent on demand such amount
distributed to such Bank, together with interest thereon at the Federal
Funds Rate for each day from the date such amount is distributed to
such Bank until the date
repaid.
2.13 Payments by the Banks to the Agent. (a) Unless the Agent receives
notice from a Bank 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 Bank will not make available as and when required
hereunder to the Agent for the account of the Company the amount of that Bank's
Pro Rata Share of the Borrowing, the Agent may assume that each Bank 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 Company on such date a corresponding amount.
If and to the extent any Bank shall not have made its full amount
available to the Agent in immediately available funds and the Agent
in such circumstances has made
available to the Company such amount, that Bank shall on the Business Day
following such Borrowing Date make such amount available to the Agent, together
with interest at the Federal Funds Rate for each day during such period.
A notice
of the Agent submitted to any Bank with respect to amounts owing under this
subsection (a) shall be conclusive, absent manifest error. If such amount is so
made available, such payment to the Agent shall constitute such Bank's Loan
on the date of Borrowing for all purposes of this Agreement.
If such amount is not made available to the Agent on the Business
Day following the Borrowing Date, the Agent will notify the Company of such
failure to fund and, upon demand by the Agent, the Company shall
pay such amount to the Agent for the Agent's account, together with
interest thereon for each day elapsed since the date of such Borrowing, at
a rate per annum equal to the interest rate applicable at the time to
the Loans comprising such Borrowing.
(b) The failure of any Bank to make any Loan on any Borrowing Date
shall not relieve any other Bank of any obligation hereunder to make a Loan on
such Borrowing Date, but no Bank shall be responsible for the failure of
any other Bank to make the Loan to be made by such other Bank on
any Borrowing Date.
2.14 Sharing of Payments, Etc. If, other than as expressly provided
elsewhere herein, any Bank 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 Bank shall immediately (a) notify the
Agent of such fact, and (b)
purchase from the other Banks such participations in the Loans made by them as
shall be necessary to cause such purchasing Bank 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 Bank, such purchase
shall to that extent be rescinded and each other Bank shall repay to the
purchasing Bank the purchase price paid therefor, together with an amount equal
to such paying Bank's ratable share (according to the proportion of (i) the
amount
of such paying Bank's required repayment to (ii) the total amount so recovered
from the purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. The Company agrees
that any Bank so purchasing a participation from another Bank 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 Bank were the direct creditor of the Company in the amount of
such participation. The Agent will keep records (which shall be conclusive and
binding in the absence of manifest error) of participations purchased under this
Section and will in each case notify the Banks following any such purchases or
repayments.
2.15 Sharing and Application of Collateral Proceeds. The Subsidiary
Guaranties and the Security Documents secure certain obligations and liabilities
of the Company to a Bank or an Affiliate of a Bank (the Other Obligations )
which do not constitute Obligations under this Agreement.
Amounts received by the Agent
under the Subsidiary Guaranties and Security Documents shall be allocated (after
payment of all expenses incurred by the Agent and the Banks in obtaining such
amounts) first among the Obligations and the portion of the Other Obligations
arising in connection with Permitted Swap Obligations ratably according to the
aggregate amount of the Obligations and of the portion of the Other Obligations
arising in connection with Permitted Swap Obligations due and payable as of the
date such amounts are received by the Agent, and any excess shall be applied to
other amounts due to a Bank or an Affiliate of a Bank which comprise
Other Obligations.
2.16 ABL Trigger Event. Notwithstanding any contrary provision in this
Agreement or any other Loan Document, upon the occurrence and during the
continuance of an ABL Trigger Event:
(a) the Company shall provide Borrowing Base Certificates
within_20_days after the end of each month and shall provide to the Agent an
update to the information relevant in determining the Qualified Domestic Net
Unbilled Progress Billing Receivables and the Qualified North American Accounts
Receivable, all in form and detail reasonably satisfactory to the Agent;
(b) the Agent shall (unless waived by the Majority Banks) conduct,
or shall cause to be conducted, a field exam of the properties of the
Company and the Subsidiary Guarantors on a quarterly basis; and
(c) the Company shall promptly (and in any event within 15_days after
a Responsible Officer obtains knowledge of the occurrence of an ABL Trigger
Event) enter into a lockbox agreement with the Agent, in form and content
acceptable to the Agent, the Majority Banks and the Company, providing
for payments made to the Company to be deposited into an account under
the sole control of the Agent.
The updates required under clause (a) above shall be provided (i)
within five days after the end of each week if the Borrowing Base Amount exceeds
the sum of the Effective Amount of Loans and the Effective Amount of L/C
Obligations by at least $10,000,000 or (ii) otherwise, on a daily basis.
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 Bank agrees, (A) from time to time on any Business
Day during the period from the Closing Date to the Revolving Termination Date to
issue Letters of Credit for the account of the Company, and to amend or renew
Letters of Credit previously issued by it, in accordance with subsections
3.02(c)
and 3.02(d), and (B) to honor drafts under the Letters of Credit; and (ii) the
Banks severally agree to participate in Letters of Credit Issued for the account
of the Company; provided, that the Issuing Bank shall not be obligated to Issue,
and no Bank 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
Revolving
Loans exceeds the lesser of [a] the Borrowing Base Amount or [b] the combined
Commitments minus (unless otherwise agreed to by the Majority Banks) the 1997
Senior Note Reserve in effect on the Issuance Date, (2) the participation of any
Bank in the Effective Amount of all L/C Obligations plus the Effective Amount of
the Revolving Loans of such Bank exceeds such Bank's 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 Bank 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
Bank from Issuing such Letter of Credit, or any Requirement of Law
applicable to the Issuing Bank or any request or directive (whether or not
having the force of law) from any Governmental Authority with jurisdiction
over the Issuing Bank shall prohibit, or request that the Issuing Bank
refrain from, the Issuance of letters of credit generally or such Letter
of Credit in particular or shall impose upon the Issuing Bank with respect
to such Letter of Credit any restriction, reserve or capital requirement
(for which the Issuing Bank is not otherwise compensated hereunder) not in
effect on the Closing Date, or shall impose upon the Issuing Bank any
unreimbursed loss, cost or expense which was not applicable on the Closing
Date and which the Issuing Bank in good xxxxx xxxxx material to it;
(ii) the Issuing Bank has received written notice from any Bank,
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 (A) more
than 24 months after the date of Issuance, unless the Majority Banks have
approved such expiry date in writing, (B) after the Revolving Termination
Date, unless the Majority Banks have approved such expiry date in writing,
or (C) more than 180_days after the Revolving Termination Date, unless all
of the Banks have approved such expiry date in writing;
(iv) any requested Letter of Credit is not in form and substance
acceptable to the Issuing Bank, or the Issuance of a Letter of Credit
shall violate any applicable policies of the Issuing Bank;
(v) such Letter of Credit is to be denominated in a currency other
than U.S. Dollars, Australian Dollars, Canadian Dollars or British Pounds.
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 Bank (with a copy sent by the Company to the Agent) at
least two Business Days (or such shorter time as the Issuing Bank 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
Bank: (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 Bank may require.
(b) At least two Business Days prior to the Issuance of any Letter
of Credit, the Issuing Bank 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 Bank will
provide the Agent with a copy thereof. Unless the Issuing Bank has
received notice on or
before the Business Day immediately preceding the date the Issuing Bank is to
issue a requested Letter of Credit from the Agent (A) directing the Issuing Bank
not to issue such Letter of Credit because such issuance is not then permitted
under subsection 3.01(a) as a result of the limitations set forth in clauses (1)
through (3) thereof; 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 Bank shall, on the requested date, issue a
Letter of Credit for the account of the
Company in accordance with the Issuing Bank's usual and customary business
practices.
(c) From time to time while a Letter of Credit is outstanding and
prior to the Revolving Termination Date, the Issuing Bank will, upon the written
request of the Company received by the Issuing Bank (with a copy sent by the
Company to the Agent) at least two Business Days (or such shorter time as the
Issuing Bank 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 Bank: (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 Bank may require. The
Issuing Bank shall be under no obligation to amend any Letter of Credit if: (A)
the Issuing Bank 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 Banks of the
receipt by it of any L/C Application or L/C Amendment Application.
(d) The Issuing Bank and the Banks agree that, while a Letter of
Credit is outstanding and prior to the Revolving Termination Date, at the option
of the Company and upon the written request of the Company received by the
Issuing Bank (with a copy sent by the Company to the Agent) at least two
Business Days (or
such shorter time as the Issuing Bank may agree in a particular instance in its
sole discretion) prior to the proposed date of notification of renewal, the
Issuing Bank 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 Bank: (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 Bank may require. The Issuing Bank shall be under no
obligation so to renew any Letter of Credit if: (A) the Issuing Bank 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 Bank that such
Letter of Credit shall not be renewed, and if at the time of renewal the Issuing
Bank would be entitled to authorize the automatic renewal of such Letter of
Credit in accordance with this subsection 3.02(e) upon the request of
the Company but the
Issuing Bank 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 Bank shall nonetheless be permitted to allow
such Letter of Credit to renew, and the Company and the Banks hereby authorize
such renewal, and, accordingly, the Issuing Bank shall be deemed to have
received an L/C Amendment Application from the Company requesting such
renewal.
(e) The Issuing Bank may, at its election (or as required by the
Agent at the direction of the Majority Banks), 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 Revolving 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 Bank 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 bank 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 Existing Bank One Letters of Credit; Risk Participations, Drawings and
Reimbursements. (a) On and after the Closing Date, the Existing Bank One
Letters of Credit shall be deemed for all purposes, including for purposes
of the fees to
be collected pursuant to subsection 3.08(a), and reimbursement of costs and
expenses to the extent provided herein, Letters of Credit outstanding under this
Agreement and entitled to the benefits of this Agreement and the other Loan
Documents, and shall be governed by the applications and agreements pertaining
thereto and by this Agreement. Each Bank shall be deemed to, and hereby
irrevocably and unconditionally agrees to, purchase from the Issuing Bank on the
Closing Date a participation in each such Letter of Credit and each drawing
thereunder in an amount equal to the product of (i) such Bank's Pro Rata Share
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 and
subsection 2.10(b), the Existing Bank One Letters of Credit shall be deemed to
utilize pro rata the Commitment of each Bank.
(b) Immediately upon the Issuance of each Letter of Credit in
addition to those described in subsection 3.03(a), each Bank shall be deemed to,
and hereby irrevocably and unconditionally agrees to, purchase from the Issuing
Bank 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 Bank, times
(ii) the
maximum amount available to be drawn under such Letter of Credit and the amount
of such drawing, respectively. For purposes of subsection 2.01, each
Issuance of a Letter of Credit shall be deemed to utilize the Commitment
of each Bank by an amount equal to the amount of such participation.
(c) In the event of any request for a drawing under a Letter of
Credit by the beneficiary or transferee thereof, the Issuing Bank will promptly
notify the Company. The Company shall reimburse the Issuing Bank prior
to 12_noon
(Milwaukee, Wisconsin time), on each date that any amount is paid by the Issuing
Bank under any Letter of Credit (each such date, an Honor Date ), in an amount
equal to the amount so paid by the Issuing Bank. In the event the Company fails
to reimburse the Issuing Bank for the full amount of any drawing under any
Letter
of Credit by 12_noon (Milwaukee, Wisconsin time) on the Honor Date, the Issuing
Bank will promptly notify the Agent and the Agent will promptly notify each Bank
thereof, and the Company shall be deemed to have requested that Base Rate Loans
be made by the Banks to be disbursed on the Honor Date under such Letter of
Credit, subject to the amount of the unutilized portion of the Commitments and
subject to the conditions set forth in Section 5.02. Any notice given by the
Issuing Bank or the Agent pursuant to this subsection 3.03(c) 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.
(d) Each Bank shall upon any notice pursuant to subsection 3.03(c)
make available to the Agent for the account of the relevant Issuing Bank an
amount
in Dollars and in immediately available funds equal to its Pro Rata Share of the
amount of the drawing, whereupon the participating Banks shall (subject to
subsection 3.03(e)) each be deemed to have made a Loan consisting of a Base Rate
Loan to the Company in that amount. If any Bank so notified fails to make
available to the Agent for the account of the Issuing Bank the amount of such
Bank's Pro Rata Share of the amount of the drawing by no later than 2:00 p.m.
(Milwaukee, Wisconsin time) on the Honor Date, then interest shall accrue on
such Bank's obligation to make such payment, from the Honor Date to the date
such Bank 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 Bank to effect such payment on
such date shall not relieve such Bank from its obligations under this Section
3.03.
(e) 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 Bank an L/C Borrowing in the amount 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 then in effect plus 2.00% , and each Bank's payment
to the Issuing Bank pursuant to subsection 3.03(d) shall be deemed payment
in respect of its participation in such L/C Borrowing and shall constitute
an L/C Advance from such Bank in satisfaction of its participation
obligation under this Section 3.03.
(f) Each Bank's obligation in accordance with this Agreement to make
the 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 Bank and shall not be affected by any
circumstance, including (i) any set-off, counterclaim, recoupment, defense or
other right which such Bank may have against the Issuing Bank, 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 Bank's obligation to make Loans under
this
Section 3.03 (but not each Bank s obligation to purchase a participation in an
L/C
Borrowing under subsection 3.03(e)) 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 Bank of immediately available funds from
the
Company (i) in reimbursement of any payment made by the Issuing Bank under the
Letter of Credit with respect to which any Bank has paid the Agent for the
account
of the Issuing Bank for such Bank'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
Bank, in the same funds as those received by the Agent for the account of the
Issuing Bank, the amount of such Bank's Pro Rata Share of such funds, and the
Issuing Bank shall receive the amount of the Pro Rata Share of such funds of any
Bank that did not so pay the Agent for the account of the Issuing Bank.
(b) If the Agent or the Issuing Bank 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 Bank pursuant to subsection
3.04(a) in reimbursement of a payment made under the Letter of Credit or
interest
or fee thereon, each Bank shall, on demand of the Agent, forthwith return to the
Agent or the Issuing Bank the amount of its Pro Rata Share of any amounts so
returned by the Agent or the Issuing Bank plus interest thereon from the date
such demand is made to the date such amounts are returned by such Bank to
the Agent or the Issuing Bank, at a rate per annum equal to the Federal
Funds Rate in effect from time to time.
3.05 Role of the Issuing Bank. (a) Each Bank and the
Company agree that, in paying any drawing under a Letter of Credit, the Issuing
Bank shall not have any responsibility to obtain any document (other than any
sight draft and certificates 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 Bank shall be liable to any Bank
for: (i)
any action taken or omitted in connection herewith at the request or with the
approval of the Banks (including the Majority Banks, 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 Bank, 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 Bank, and the Issuing Bank 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 Bank's willful misconduct or gross negligence
or the Issuing Bank's willful failure to pay under any Letter of Credit
after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a
Letter of Credit. In furtherance and not in limitation of the
foregoing: (i) the Issuing Bank may accept documents that
appear on their face to be in order, without responsibility for further
investigation, regardless of any notice or information to the contrary; and (ii)
the Issuing Bank 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 Bank 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, 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 Bank 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 Bank under any Letter of Credit
against presentation of a draft or certificate that substantially complies
with the terms of any Letter of Credit; or any payment made by the Issuing
Bank 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.
3.07 Cash Collateral Pledge. Upon (i) the request of the Agent, (A) if the
Issuing Bank has honored any full or partial drawing request on any Letter of
Credit and such drawing has resulted in an L/C Borrowing hereunder, or (B)
if, as of the Revolving 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 subsection 2.07(a) requiring the Company to Cash
Collateralize Letters of Credit, then, the Company shall immediately Cash
Collateralize the 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 Banks a letter of credit fee (i) with respect to the
Nonfinancial Letters of Credit equal to 50% of the Applicable Margin for LIBOR
Rate Loans in effect from time to time (on a per annum basis) multiplied by the
average daily maximum amount available to be drawn under the outstanding
Nonfinancial Letters of Credit and (ii) with respect to the Financial Letters of
Credit equal to the Applicable Margin for LIBOR Rate Loans in effect from
time to time (on a per annum basis) multiplied by the average daily
maximum amount available to be drawn under the outstanding Financial
Letters of Credit, computed
on a monthly basis in arrears on the last Business Day of each month based upon
Letters of Credit outstanding for that month as calculated by the Agent. 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 date to occur after the Closing Date,
through the Revolving Termination Date (or such later date upon which the
outstanding Letters of Credit shall expire), with the final payment to be
made on the Revolving Termination Date (or such later expiration date).
(b) The Company shall pay to the Issuing Bank from time to time on
demand the normal issuance, presentation, amendment and other processing
fees, and
other standard costs and charges, of the Issuing Bank 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 to each Bank 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 shall pay all Other Taxes.
(b) If the Company shall be required by law to deduct or withhold any
Taxes or Other Taxes from or in respect of any sum payable hereunder to any Bank
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 Bank 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 shall make such deductions and withholdings;
(iii) the Company shall pay the full amount deducted or withheld to
the relevant taxing authority or other authority in accordance with
applicable law.
(c) The Company agrees to indemnify and hold harmless each Bank and
the Agent for the full amount of (i) Taxes and (ii) Other Taxes in the
amount that
the respective Bank specifies as necessary to preserve the after-tax yield the
Bank would have received if such Taxes or Other 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 or Other
Taxes were correctly or legally asserted. Payment under this indemnification
shall be made within 30 days after the date the Bank or the Agent makes written
demand therefor.
(d) Within 30 days after the date of any payment by the Company of
Taxes or Other Taxes, the Company shall furnish to each Bank or the Agent the
original or a certified copy of a receipt evidencing payment thereof, or other
evidence of payment satisfactory to such Bank or the Agent.
(e) If the Company is required to pay any amount to any Bank or the
Agent pursuant to subsection (b) or (c) of this Section, then such Bank
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 which may thereafter accrue, if such change in the sole
judgment of such Bank is not otherwise disadvantageous to such Bank.
4.02 Illegality. (a) If any Bank determines that the introduction of any
Requirement of Law, or any change in any Requirement of Law, or in the
interpretation or administration of any Requirement of Law, has made it
unlawful,
or that any central bank or other Governmental Authority has asserted that it is
unlawful, for any Bank or its applicable Lending Office to make LIBOR Rate
Loans,
then, on notice thereof by the Bank to the Company through the Agent, any
obligation of that Bank to make LIBOR Rate Loans shall be suspended until the
Bank
notifies the Agent and the Company that the circumstances giving rise to such
determination no longer exist.
(b) If a Bank determines that it is unlawful to maintain any LIBOR
Rate Loan, the Company shall, upon its receipt of notice of such fact and demand
from such Bank (with a copy to the Agent), prepay in full such LIBOR Rate Loans
of that Bank then outstanding, together with interest accrued thereon and
amounts
required under Section 4.04, either on the last day of the Interest Period
thereof, if the Bank may lawfully continue to maintain such LIBOR Rate Loans to
such day, or immediately, if the Bank may not lawfully continue to maintain such
LIBOR Rate Loan. If the Company is required to so prepay any LIBOR Rate Loan,
then concurrently with such prepayment, the Company shall borrow from the
affected Bank, in the amount of such repayment, a Base Rate Loan.
(c) If the obligation of any Bank to make or maintain LIBOR Rate
Loans has been so terminated or suspended, the Company may elect, by giving
notice to the Bank through the Agent that all Loans which would otherwise
be made by the Bank as LIBOR Rate Loans shall be instead Base Rate Loans.
(d) Before giving any notice to the Agent under this Section, the
affected Bank shall designate a different Lending Office with respect to its
LIBOR Rate Loans if such designation will avoid the need for giving such
notice or making such demand and will not, in the judgment of the Bank,
be illegal or otherwise disadvantageous to the Bank.
4.03 Increased Costs and Reduction of Return. (a) If any Bank determines
that, due to either (i)_the introduction of or any change (other than any change
by way of imposition of or increase in reserve requirements included in the
calculation of the LIBOR Rate) in or in the interpretation of any law or
regulation generally applicable to the banking industry issued or made after the
date of this Agreement or (ii)_the compliance by that Bank with any guideline or
request from any central bank or other Governmental Authority generally
applicable to the banking industry (whether or not having the force of
law) issued or made after the date of this Agreement, there shall be any
increase in the cost to such
Bank of agreeing to make or making, funding or maintaining any LIBOR Rate Loans
or participating in Letters of Credit, or, in the case of the Issuing Bank, any
increase in the cost to the Issuing Bank 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) made within 90_days after the date of the event
under clause (i) or (ii) above, pay to the Agent for the account of such Bank,
additional amounts as are sufficient to compensate such Bank for such increased
costs.
(b) If any Bank shall have determined that (i) the introduction after
the date of this Agreement of any Capital Adequacy Regulation, (ii) any change
after the date of this Agreement in any Capital Adequacy Regulation, (iii) any
change after the date of this Agreement 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 after the date of this Agreement by such Bank (or its Lending Office)
or any corporation controlling such Bank with any Capital Adequacy Regulation,
affects or would affect the amount of capital required or expected to be
maintained by such Bank or any corporation controlling such Bank and (taking
into consideration such Bank's or such corporation's policies with respect to
capital adequacy and such Bank'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 Bank to the Company
through the Agent made within 90_days after the date of the event under clause
(i), (ii), (iii) or (iv) above, the Company shall pay to such Bank, from time to
time as specified by such Bank, additional amounts sufficient to compensate such
Bank for such increase.
(c) A Bank may make a demand for payment under subsections (a) and
(b) of this Section only if such Bank has made similar demands for payment on
similar borrowers in the U.S. which have entered into similar credit agreements
with such Bank and against which such Bank is entitled by contract to demand
such payments.
4.04 Funding Losses. The Company shall reimburse each Bank and hold each
Bank harmless from any loss or expense which the Bank may sustain or incur as a
consequence of:
(a) the failure of the Company to make on a timely basis any payment
of principal of any LIBOR Rate Loan;
(b) the failure of the Company to borrow, continue or convert a Loan
after the Company has given (or is deemed to have given) a Notice of
Borrowing or a Notice of Conversion/ Continuation;
(c) the prepayment (including pursuant to Section 2.07) or other
payment (including after acceleration thereof) of an LIBOR Rate Loan on a
day that is not the last day of the relevant Interest Period; or
(d) the automatic conversion under Section 2.04 or subsection_4.02(b)
of any LIBOR Rate Loan to a Base Rate Loan on a day that is not the last day of
the relevant Interest Period;
including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its LIBOR Rate Loans or from fees payable to
terminate the deposits from which such funds were obtained. For purposes of
calculating amounts payable by the Company to the Banks under this Section and
under subsection 4.03(a), each LIBOR Rate Loan made by a Bank (and each related
reserve, special deposit or similar requirement) shall be conclusively deemed to
have been funded at the LIBOR used in determining the LIBOR Rate for such LIBOR
Rate Loan by a matching deposit or other borrowing in the interbank eurodollar
market for a comparable amount and for a comparable period, whether or not such
LIBOR Rate Loan is in fact so funded.
4.05 Inability to Determine Rates. If the Agent determines that for any
reason adequate and reasonable means do not exist for determining the LIBOR Rate
for any requested Interest Period with respect to a proposed LIBOR Rate Loan, or
that the LIBOR Rate applicable pursuant to subsection 2.09(a) for any requested
Interest Period with respect to a proposed LIBOR Rate does not adequately and
fairly reflect the cost to the Banks of funding such Loan, the Agent will
promptly
so notify the Company and each Bank. Thereafter, the obligation of the Banks to
make or maintain LIBOR Rate Loans hereunder shall be suspended until the Agent
upon the instruction of the Majority Banks revokes such notice in writing. Upon
receipt of such notice, the Company may revoke any Notice of Borrowing or Notice
of Conversion/Continuation then submitted by it. If the Company does not revoke
such Notice, the Banks shall make, convert or continue the Loans, as proposed by
the Company, in the amount specified in the applicable notice submitted by the
Company, but such Loans shall be made, converted or continued as Base Rate Loans
instead of LIBOR Rate Loans.
4.06 Certificates of Banks. Any Bank claiming reimbursement or
compensation
under this Article IV shall deliver to the Company (with a copy to the Agent) a
certificate setting forth in reasonable detail the amount payable to the Bank
hereunder and such certificate shall be conclusive and binding on the Company in
the absence of manifest error.
4.07 Substitution of Banks. Upon the receipt by the Company from any Bank
(an "Affected Bank") of a claim for compensation under Section 4.03, the Company
may: (i) request the Affected Bank to use its best efforts to obtain a
replacement bank or financial institution satisfactory to the Company to acquire
and assume all or a ratable part of all of such Affected Bank's Loans and
Commitment (a "Replacement Bank"); (ii) request one more of the other Banks to
acquire and assume all or part of such Affected Bank's Loans and Commitment; or
(iii) designate a Replacement Bank. Any such designation of a Replacement Bank
under clause (i) or (iii) shall be subject to the prior written consent of the
Agent (which consent shall not be unreasonably withheld).
4.08 Survival. The agreements and obligations of the Company in this
Article IV shall survive the payment of all other Obligations but any
request for
a payment or compensation made by a Bank under this Article IV must be delivered
no later than 90_days after the last to occur of payment in full of the
Obligations, the expiration or termination of the Commitments and the expiration
of all Letters of Credit.
ARTICLE V
CONDITIONS PRECEDENT
5.01 Conditions of Initial Credit Extensions. The obligation of each Bank
to make its initial Credit Extension hereunder is subject to the condition that
the Agent shall have received on or before the date of the initial Credit
Extension all of the following, in form and substance satisfactory to the Agent
and each Bank, and in sufficient copies for each Bank:
(a) Credit Agreement and Notes. This Agreement and the Notes
executed by each party thereto;
(b) Subsidiary Guaranties. The Subsidiary Guaranties duly executed
by the Subsidiary Guarantors;
(c) Security Documents.
(i) The Company Security Agreement, duly executed by
the Company, together with such financing statements and other filings as
are necessary to perfect the security interest in the properties of the
Company granted to the Agent therein;
(ii) The Company Pledge Agreement, duly executed by the
Company, together with certificates representing 100% of the issued and
outstanding stock of the Company s domestic Subsidiaries and 65% of the
issued and outstanding stock of the Company s foreign Subsidiaries and
duly executed blank, undated stock powers;
(iii) Separate Subsidiary Guarantor Security Agreements,
each duly executed by the appropriate Subsidiary Guarantor, together with
such financing statements and other filings as are necessary to perfect
the security interest in the properties of the Subsidiary Guarantors
granted to the Agent therein;
(iv) The Intercompany Notes, duly executed by the
applicable Subsidiary Guarantors, and endorsed in blank by the Company;
(v) The Intercompany Security Agreements, duly
executed by each Subsidiary Guarantor party to an Intercompany Note,
together with such financing statements and other filings as are necessary
to perfect the security interest in the properties of such Subsidiary
granted to the Company therein (which financing statements shall list the
Agent as assignee of the Company); and
(vi) The Assignment of Intercompany Security
Agreements, duly executed by the Company.
(d) Resolutions and By-Laws; Incumbency.
(i) Copies of the by-laws of BAC, the Company and each Subsidiary
Guarantor as in effect on the Closing Date and of the resolutions of the
board of directors of the Company and each Subsidiary Guarantor
authorizing the transactions contemplated hereby, each certified as of the
Closing Date by the Secretary or an Assistant Secretary of such Person;
and
(ii) A certificate of the Secretary or Assistant Secretary of the
Company and each Subsidiary Guarantor certifying the names and true
signatures of the officers of the Company or such Subsidiary Guarantor
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) the articles or certificate of incorporation of BAC, the
Company and each Subsidiary Guarantor as in effect on the Closing Date,
certified by the Secretary of State (or similar, applicable Governmental
Authority) of its state of incorporation as of a recent date; and
(ii) a good standing certificate or certificate of status for the
Company and each Subsidiary Guarantor from the Secretary of State (or
similar, applicable Governmental Authority) of its state of incorporation
and each state where the Company or such Subsidiary Guarantor is qualified
to do business as a foreign corporation as of a recent date;
(f) Machinery and Equipment Appraisal. An appraisal of the orderly
liquidation value of the machinery and equipment owned by the Company, including
that to be acquired as part of the Xxxxxx Acquisition, in form and detail
satisfactory to the Agent;
(g) Lien Searches. Searches of the appropriate public offices
demonstrating that no Lien is of record with respect to the Company, any
Subsidiary Guarantor or Xxxxxx except (i) Liens which will be terminated or
released upon the repayment of the 1994 Secured Notes and the Existing Bank One
Credit Agreement and (ii) Permitted Liens;
(h) Borrowing Base Certificate. A completed Borrowing Base
Certificate as of August_31, 1997;
(i) Insurance Certificates. Insurance certificates fulfilling the
requirements set forth in the Security Documents;
(j) Environmental Questionnaire. An environmental questionnaire,
completed by the Company, disclosing that, except as disclosed in Schedule 6.12
hereto, there exists as of the Closing Date no uncorrected violation by the
Company or any domestic Subsidiary of any Environmental Laws or any condition
which would subject the Company or such domestic Subsidiary to damages,
penalties, injunctive relief or clean-up costs under any Environmental Laws or
which require or are likely to require clean up, removal, remedial action or
other response under any Environmental Laws which could reasonably be expected
to result in a Material Adverse Effect;
(k) Redemption of 1994 Secured Notes; Repayment of Loans under the
Existing Bank One Credit Agreement; Termination Statements. Evidence
satisfactory to the Agent that, on the Closing Date, the 1994 Secured Notes will
be purchased for cancellation, redeemed or defeased, and the principal balance
of and accrued interest on all loans (other than the PECFA Loan) under the
Existing Bank One Credit Agreement and under the PPM Bridge Loan Facility will
be paid, in full out of the proceeds of Revolving Loans made on the Closing Date
and the proceeds from the issuance of the 1997 Senior Notes, together with
executed termination statements, in form satisfactory for filing, evidencing the
termination of the security interests in the Company s properties which secured
the 1994 Secured Notes and the Existing Bank One Credit Agreement (other than
with respect to the PECFA Loan);
(l) Issuance of the 1997 Senior Notes. Evidence satisfactory to
the Agent that the Company has issued and received payment for the 1997 Senior
Notes and copies, certified by the Secretary or Assistant Secretary of the
Company, of the 1997 Senior Note Documents;
(m) Xxxxxx Acquisition. Evidence satisfactory to the Agent that
the Xxxxxx Acquisition has been completed in accordance with the terms and
provisions of the Xxxxxx Acquisition Documents and copies, certified by the
Secretary of Assistant Secretary of the Company, of the Xxxxxx Acquisition
Documents.;
(n) Legal Opinions. An opinion of Xxxxx Xxxxxxxxxxx Xxxxx S.C.,
counsel to the Company and addressed to the Agent and the Banks, substantially
in the form of Exhibit D.
(o) 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 Bank One to
the extent invoiced
prior to or on the Closing Date, plus such additional amounts of Attorney Costs
as shall constitute Bank One'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 Bank One); including any such costs, fees and expenses
arising under or referenced in Sections 2.10 and 11.04;
(p) Certificate. A certificate signed by a Responsible Officer,
dated as of the Closing Date, stating that:
(i) the representations and warranties contained in Article V 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
Credit Extension; and
(iii) there has occurred since December 31, 1996, no event or
circumstance that has resulted or could reasonably be expected to result
in a Material Adverse Effect;
(q) Surplus Assets. A copy of any contract entered into by the
Company or any Subsidiary Guarantor to sell or otherwise dispose of any of the
assets included in the appraisal referred to in subsection_5.01(f);
(r) AIP Purchase. (i) a certificate executed by a Responsible
Officer certifying [A] the AIP Merger Agreement has not been terminated by any
party thereto and none of the events listed in Annex_I to the AIP Merger
Agreement
shall have occurred; [B] the Minimum Condition (as defined in the AIP Merger
Agreement) and the other conditions set forth in Annex_I have been satisfied;
and [C] the number of shares of common stock of the Company validly
tendered to BAC and not withdrawn and the number of Dissenting Shares
(as defined in section_2.2 of the AIP Merger Agreement);
(ii) If the Short Form Merger (as defined in the Offering
Memorandum for the 1997_Senior Notes) is to occur on the Closing Date, a copy of
the Certificate of Merger of BAC and the Company and evidence satisfactory to
the Agent that such Certificate will be filed with the Secretary of State
of Delaware
before or concurrently with the initial extensions of credit hereunder and that
the merger of BAC and the Company will be effective upon filing;
(iii) If the Short Form Merger will not occur on the Closing
Date, a copy of the promissory note of AIP evidencing the AIP Bridge Loan
(if made on the Closing Date); and
(iv) Evidence satisfactory to the Agent that AIP has invested
not less than $143,000,000 to effect the AIP Purchase.
(s) Other Documents. Such other approvals, opinions, documents or
materials as the Agent or any Bank may request.
5.02 Conditions to All Credit Extensions. The obligation of each Bank to
make any Revolving Loan to be made by it (including its initial Revolving Loan)
or to continue or convert any Revolving Loan under Section 2.04 and the
obligation
of the Issuing Bank to Issue any Letter of Credit (including the initial Letter
of Credit) is subject to the satisfaction of the following conditions precedent
on the relevant Borrowing Date, Conversion/Continuation Date or Issuance Date:
(a) Notice, Application. The Agent shall have received (with, in the
case of the initial Revolving Loan only, a copy for each Bank) a Notice of
Borrowing or a Notice of Conversion/Continuation, as applicable, or in the case
of any Issuance of any Letter of Credit, the Issuing Bank and the Agent shall
have received an L/C Application or L/C Amendment Application, as required under
Section 3.02;
(b) Continuation of Representations and Warranties. The
representations and warranties in Article VI shall be true and correct on and as
of such Borrowing Date or Conversion/Continuation Date or Issuance Date with the
same effect as if made on and as of such Borrowing Date or Conversion/
Continuation
Date or Issuance Date (except to the extent such representations and warranties
expressly refer to an earlier date, in which case they shall be true and correct
as of such earlier date);
(c) No Material Adverse Effect. No event or act shall have occurred,
and no condition shall exist, which results in, individually or in the
aggregate, a Material Adverse Effect; and
(d) No Existing Default. No Default or Event of Default shall exist
or shall result from such Borrowing or continuation or conversion or Issuance.
Each Notice of Borrowing, Notice of Conversion/Continuation and L/C Application
or L/C Amendment Application submitted by the Company hereunder shall constitute
a representation and warranty by the Company hereunder, as of the date of each
such notice and as of each Borrowing Date, Conversion/Continuation Date, or
Issuance Date, as applicable, that the conditions in this Section 5.02 are
satisfied.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Agent and each Bank that:
6.01 Corporate Existence and Power. The Company, each of its Material
Domestic Subsidiaries and each of its Material Foreign Subsidiaries:
(a) is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) has the power and authority to own its assets, carry on its
business and to execute, deliver, and perform its obligations under each of the
Loan Documents to which it is a party;
(c) has all governmental licenses, authorizations, consents and
approvals to own its assets and carry on its business;
(d) 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
(e) is in compliance with all Requirements of Law;
except, in each case referred to in clause (c), clause (d) or clause (e), 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 the Company and its Subsidiaries of this Agreement and each other
Loan Document to 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 that 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
relating to borrowed money or evidencing any other material 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 is necessary or required in connection with the execution, delivery or
performance by, or enforcement against, the Company or any of the Subsidiary
Guarantors of this Agreement or any other Loan Document.
6.04 Binding Effect. This Agreement and each other Loan Document to which
the Company or any Subsidiary Guarantor is a party constitute the legal,
valid and binding obligations of the Company and such Subsidiary
Guarantor to the extent it
is a party thereto, 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. Except as specifically disclosed in Schedule 6.05, there
are no actions, suits, proceedings, claims or disputes pending, or to the best
knowledge of the Company, threatened or contemplated, at law, in equity, in
arbitration or before any Governmental Authority, against the Company, or its
Subsidiaries or any of their respective properties which:
(a) purport to affect or pertain to this Agreement or any other Loan
Document, the Xxxxxx Acquisition Documents, the Senior Note Documents, the AIP
Purchase or any of the transactions contemplated hereby or thereby; or
(b) if determined adversely to the Company or 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 (i) the execution, delivery or performance of this
Agreement or any other Loan Document, the Xxxxxx Acquisition Documents, the
1997 Senior Note Documents or directing that the transactions provided for
herein or therein not be consummated as herein or therein provided or
(ii) the AIP Purchase.
6.06 No Default. No Default or Event of Default exists or would result
from the incurring of any Obligations by the Company or by any Subsidiary
Guarantor. 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 subsection 9.01(e).
6.07 ERISA Compliance. Except as specifically disclosed in Schedule 6.07:
(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 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 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.
6.09 Title to Properties. Except as specifically disclosed in Schedule
6.09, the Company, each Material Domestic Subsidiary and each Material Foreign
Subsidiary have good record and marketable title 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 and after giving effect to the purchase for
cancellation, redemption
or defeasance of the 1994 Secured Notes and the payment of all loans (other than
the PECFA Loan) outstanding under the Existing Bank One Credit Agreement, the
properties of the Company and its Material Domestic Subsidiaries are subject to
no Liens, other than Permitted Liens.
6.10 Taxes. Except as specifically disclosed in Schedule 6.10, the Company
and its Subsidiaries 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
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 audited consolidated financial
statements
of the Company and its Subsidiaries dated December 31, 1996, and the related
consolidated statements of income or operations, shareholders' equity and cash
flows for the fiscal year ended on that date and the unaudited consolidated
financial statements of the Company and its Subsidiaries dated June_30, 1997,
and the related consolidated statements of income or operations,
shareholders equity and cash flows for the fiscal quarter ended on such date:
(i) were prepared in accordance with GAAP consistently applied
throughout the periods covered thereby, except as otherwise expressly
noted therein, subject, in the case of the June_30, 1997 financial
statements, to ordinary, good faith year end audit adjustments;
(ii) fairly present the financial condition of the Company and its
Subsidiaries as of the date thereof and results of operations for the
periods covered thereby; and
(iii) except as specifically disclosed in Schedule 6.11, 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 Contractual Obligations (other
than those incurred in the ordinary course of business) and Contingent
Obligations.
(b) Since June_30, 1997 there has been no Material Adverse Effect.
(c) The Company has furnished to the Agent and the Banks a pro forma
balance sheet of the Company and its consolidated Subsidiaries, reflecting the
Xxxxxx Acquisition, the issuance of the 1997_Senior Notes and the AIP Purchase,
dated as of June_30, 1997 (the Pro Forma Balance Sheet ). To the best
knowledge of the Company, the Pro Forma Balance Sheet fairly presents the
assets, liabilities and financial condition of the Company and its consolidated
Subsidiaries as of the Closing Date and there are no omissions from the
Pro Forma Balance Sheet, or other facts and circumstances not reflected
in the Pro Forma Balance Sheet, which would be material under GAAP.
6.12 Environmental Matters. The Company conducts in the ordinary course of
business a review of the effect of existing Environmental Laws and existing
Environmental Claims on its business, operations and properties, and as a result
thereof the Company has reasonably concluded that, except as specifically
disclosed in Schedule 6.12, such Environmental Laws and Environmental
Claims could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.
6.13 Regulated Entities. None of the Company, any Person controlling the
Company, or any Subsidiary, is an Investment Company within the meaning of the
Investment Company Act of 1940. The Company is not 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.
6.14 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.
6.15 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 which, if successfully asserted, could
reasonably be expected to have
a Material Adverse Effect. 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 which, if
successfully asserted, could reasonably be expected to have a Material Adverse
Effect. Except as specifically disclosed in Schedule 6.05, 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.
6.16 Subsidiaries. As of the Closing Date, the Company has no Subsidiaries
other than those specifically disclosed in part (a) of Schedule 6.16 hereto and
has no equity investments in any other Person other than those specifically
disclosed in part (b) of Schedule 6.16.
6.17 Insurance. Except as specifically disclosed in Schedule 6.17, 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.
6.18 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.
6.19 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
(including the offering and disclosure materials delivered by or on behalf
of the Company to the Banks prior to the Closing Date), 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, 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 Bank 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 Banks 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 Banks, with sufficient
copies for each Bank:
(a) as soon as available, but not later than 90 days after the end
of each fiscal year, a copy of the audited consolidated balance sheet of the
Company and its Subsidiaries as at the end of such year and the related
consolidated statements of income or 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 for
changes in accounting principles required by GAAP. Such opinion shall not 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;
(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 sheets of the Company and its
Subsidiaries as of the end of such quarter, the related consolidated and
consolidating statement of income and the related consolidated statements of
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; and
(c) as soon as available, but not later than 60 days after the end
of each fiscal year, a copy of an unaudited consolidating balance sheet of the
Company and its Subsidiaries as at the end of such year and the related
consolidating statement of income for such year, certified by a Responsible
Officer as having been developed and used in connection with the preparation of
the financial statements referred to in subsection 7.01(a).
7.02 Certificates; Other Information. The Company shall furnish to the
Agent, with sufficient copies for each Bank:
(a) concurrently with the delivery of the financial statements
referred to in subsections 7.01(a) and (b), a Compliance Certificate executed by
a Responsible Officer;
(b) 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;
(c) within 30_days after the end of each month, a completed Borrowing
Base Certificate executed by a Responsible officer; and
(d) 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 Bank, may from time to time reasonably request.
7.03 Notices. The Company shall promptly notify the Agent and each Bank:
(a) of the occurrence of any Default or Event of Default, and of the
occurrence or existence of any event or circumstance that is likely to
become, in
the good faith judgment of the Company, a Default or Event of Default;
(b) of any matter, including (i) breach or non-performance of, or any
default under, a Contractual Obligation of the Company or any Subsidiary;
(ii) any
dispute, litigation, investigation, proceeding or suspension between the Company
or any Subsidiary and any Governmental Authority; or (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, which, in the case of any of the foregoing, has resulted
in or may result in a Material Adverse Effect;
(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 Bank 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; and
(e) 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.
Each notice under subsections 7.03(a), (b), (c) and (d) 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 subsection 7.03(a) shall describe with particularity any and all
clauses or provisions of this Agreement or other Loan Document that have
been (or likely will be) breached or violated.
7.04 Preservation of Corporate Existence, Etc. The Company shall,
and shall cause each Material Subsidiary to:
(a) except as permitted under Section 8.03, 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 Material 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 except where the failure to do so could not reasonably be
expected to have a Material Adverse Effect. The Company and each Material
Subsidiary shall use the standard of care typical in the industry in the
operation and maintenance of its facilities.
7.06 Insurance. The Company shall maintain, and shall cause each Material
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.
7.07 Payment of Obligations. The Company shall, and shall cause each
Material 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
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, to the extent that failure to pay such Indebtedness would cause an
Event of Default under subsection 9.01(e), except such as may be contested
in good faith or as to which a bona fide dispute may exist.
7.08 Compliance with Laws. The Company shall comply, and shall cause each
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; 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 each Subsidiary to permit,
representatives and independent contractors of the Agent or any Bank 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 or after the occurrence of an ABL
Trigger Event, the Agent or any Bank may do any of the foregoing at the
expense of the Company at any time during normal business hours and
without advance notice.
7.11 Environmental Laws. The Company shall, and shall cause each
Subsidiary to, conduct its operations and keep and maintain its property
in compliance in all material respects with all Environmental Laws.
7.12 Use of Proceeds. The Company shall use the proceeds of the Loans to
finance the purchase for cancellation, redemption or defeasance of the 1994
Secured Notes, the repayment of amounts owing under the Existing Bank One Credit
Agreement, the PPM Bridge Loan Facility and the AIP Bridge Loan, the purchase of
common stock pursuant to the AIP Purchase, and for working capital and other
general corporate purposes not in contravention of any Requirement of Law or of
any Loan Document.
7.13 Obligations under Other Loan Documents. The Company shall comply, and
shall cause each Subsidiary Guarantor to comply, with its obligations under the
other Loan Documents to which such Person is a party.
7.14 Future Subsidiary Guarantors. The Company shall, at the earlier of (a)
the date a Subsidiary guarantees the obligations of the Company under the 1997
Senior Notes or the Senior Note Indenture or (b) 30_days after a
Subsidiary of the
Company becomes a Material Domestic Subsidiary, cause such Subsidiary to deliver
to the Agent (a) a Subsidiary Guaranty and a Subsidiary Guarantor Security
Agreement, duly executed by the new Subsidiary Guarantor, (b) such financing
statements and other filings necessary to perfect the security interest granted
to the Agent, (c) the documents referred to in subsections 5.01(d), (e) and (i)
with respect to the new Subsidiary Guarantor, (d) an opinion of counsel to
the new
Subsidiary Guarantor and (e) such other documents as the Agent may request. All
such documents shall be satisfactory in form and content to the Agent.
ARTICLE VIII
NEGATIVE COVENANTS
So long as any Bank 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 Banks waive
compliance in writing:
8.01 Limitation on Liens. The Company shall not, and shall not suffer or
permit any Subsidiary Guarantor 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 existing on property of the Company or any Subsidiary
Guarantor 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 Guarantor
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 no later than
10_days after the commencement of any proceeding seeking enforcement of
such Lien
and all such Liens in the aggregate at any time outstanding for (i) the Company
and the Subsidiary Guarantors do not exceed $2,000,000 and (ii) for the Company,
its Material Domestic Subsidiaries and its Material Foreign Subsidiaries do not
exceed $4,000,000;
(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 Material Domestic Subsidiaries;
(i) Liens on assets of a Person which becomes a Subsidiary Guarantor
after the date of this Agreement, provided, however, (i) that such Liens existed
at the time the Person became a Subsidiary Guarantor and were not created in
anticipation thereof; and (ii) such Liens attach only to the property of such
Subsidiary Guarantor;
(j) purchase money security interests on any property acquired or
held by the Company or the Subsidiary Guarantor in the ordinary course of
business, securing Indebtedness incurred or assumed for the purpose of financing
all or any part of the cost of acquiring such property; provided that (i)
any such
Lien attaches to such property concurrently with or within 20 days after the
acquisition thereof, (ii) such Lien attaches solely to the property so acquired
in such transaction, (iii) the principal amount of the debt secured thereby does
not exceed 100% of the cost of such property, and (iv) the principal amount
of the Indebtedness secured by any and all such purchase money security
interests shall not exceed $10,000,000 at any time;
(k) Liens securing obligations in respect of capital leases on assets
subject to such leases, provided that such capital leases are otherwise
permitted hereunder;
(l) 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 or the appropriate Subsidiary Guarantor 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 Guarantor to provide collateral
to the depository institution;
(m) Liens consisting of pledges of cash collateral or government
securities to secure on a xxxx-to-market basis Permitted Swap Obligations only,
provided that (i) the counterparty to any Swap Contract relating to
such Permitted Swap Obligation is under a similar requirement to deliver
similar collateral from time to time to the Company or the Subsidiary
Guarantor party thereto on a xxxx-to-market basis; and (ii) the aggregate
value of such collateral so pledged by the Company and the Subsidiary
Guarantors together in favor of any counterparty does not at any
time exceed $2,000,000;
(n) Liens on property of the Company which is leased by the Company
to a customer securing Indebtedness in a principal amount not greater than 125%
of the aggregate book value of such leased property; provided that the aggregate
principal amount of Indebtedness secured by any and all such Liens, together
with the Guaranty Obligations permitted under subsection_8.08(e), shall
not exceed $10,000,000 at any time;
(o) Liens securing the Company s Indebtedness or Contingent
Obligations with respect to Surety Instruments permitted under Section_8.08(d),
provided that such Liens attach only to the inventory, accounts receivable and
related proceeds for the specific product being manufactured, supplied or
serviced
by the Company or any domestic Subsidiary with respect to which such Surety
Instrument was obtained and, in the case of Surety Instruments relating to the
provision of services, the equipment at the service location necessary to
complete such services; and
(p) Liens securing Indebtedness for borrowed money, capitalized
leases or other comparable financing arrangements not permitted by, or exceeding
the amounts of Indebtedness permitted under, clauses (a), (b), (i), (j), (n) and
(o) above in an aggregate amount principal amount not exceeding $10,000,000
at any time.
8.02 Disposition of Assets. The Company shall not, and shall not suffer or
permit any Subsidiary Guarantor 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) dispositions of inventory in the ordinary course of business;
(b) the sale of equipment to the extent that such equipment is
exchanged for credit against the purchase price of similar replacement
equipment, or the proceeds of such sale are reasonably promptly applied
to the purchase price of such replacement equipment;
(c) dispositions of inventory by the Company or any Subsidiary
Guarantor to the Company or any other Subsidiary pursuant to reasonable business
requirements;
(d) dispositions of equipment which is obsolete and/or no longer
necessary in the business operations of the Company or the applicable Subsidiary
Guarantor so long as the net book value of all such equipment disposed of
does not exceed $3,000,000 during any fiscal year;
(e) the dispositions referred to in clauses (1), (2) and (3) in the
second paragraph of the definition of Net Proceeds ; and
(f) dispositions not otherwise permitted hereunder which are made for
fair market value; provided, that (i) at the time of any disposition, no
Event of Default shall exist or shall result from such disposition, (ii) at
least 75% of
the aggregate sales price from such disposition shall be paid in cash, and (iii)
the aggregate value of all assets so sold by the Company and the Subsidiary
Guarantors, together, shall not exceed $10,000,000 on a cumulative basis for the
1997_and 1998 fiscal years or $2,000,000 in any subsequent fiscal year.
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 Subsidiary may merge with the Company, provided that the
Company shall be the continuing or surviving corporation, or with any one
or more Subsidiaries, provided that if any transaction shall be between a
Subsidiary and
a Wholly-Owned Subsidiary or a Subsidiary Guarantor, the Wholly-Owned Subsidiary
or the Subsidiary Guarantor, as the case may be, shall be the continuing or
surviving corporation;
(b) any Subsidiary (other than a Subsidiary Guarantor) may sell all
or substantially all of its assets (upon voluntary liquidation or otherwise), to
the Company or another Wholly-Owned Subsidiary; and
(c) the Company may merge with BAC (with the Company as the surviving
corporation) as a component of the AIP Purchase.
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 held by the Company or a Subsidiary in the form of
cash equivalents;
(b) extensions of credit in the nature of accounts receivable or
notes receivable or lease receivables arising from the sale or lease of goods or
services in the ordinary course of business;
(c) Investments by the Company in and to any of its existing domestic
Subsidiaries (excluding Western Gear Manufacturing Co.), provided that any
extension of credit to a Material Domestic Subsidiary shall be evidenced by an
Intercompany Note which is subject to the Company Pledge Agreement and
secured by an Intercompany Security Agreement which is subject to the
Assignment of Intercompany Security Agreement;
(d) Investments by the Company in and to its foreign Subsidiaries in
existence on the Closing Date and extensions of credit to foreign Subsidiaries
made after the Closing Date, provided that the aggregate extensions of credit
(excluding accounts receivable and notes receivable arising from the sale of
goods in the ordinary course of business) to foreign Subsidiaries shall
not exceed $40,000,000 at any time;
(e) Investments in Joint Ventures not exceeding $5,000,000 in any
fiscal year as to all such Investments in the aggregate;
(f) Investments constituting Permitted Swap Obligations or payments
or advances under Swap Contracts relating to Permitted Swap Obligations;
(g) extensions of credit by a Subsidiary to the Company or to another
Subsidiary, provided that any extension of credit by a Subsidiary Guarantor may
only be made to the Company or another Subsidiary Guarantor; and
(h) Investments by the Company or a Subsidiary in (i) obligations
issued or unconditionally guaranteed by the United States government, (ii) time
accounts, certificates of deposit and banker s acceptances issued by any Bank or
by any other commercial bank organized under the laws of the United States
or any state thereof having a combined capital and surplus of at least
$250,000,000, (iii) commercial paper issued by a corporation
incorporated under the laws of the
United States or any state thereof which matures no more than 90_days after the
date of purchase and which is rated Prime-1 or better by Xxxxx s Investor
Service or A-1 or better by Standard & Poor s Ratings Group, (iv) repurchase
agreements collateralized by securities described in clause (i) above with
commercial banks described in clause (ii) above having a maturity not greater
than 7_days and (v) shares of a mutual fund organized under the Investment
Company Act of 1940, as amended, which invests its assets exclusively
in obligations of the types described in clauses (i) through (iv).
8.05 Limitation on Indebtedness. The Company shall not, and shall not
suffer or permit any domestic 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 and the obligations of the Company at such time as any
such Contingent Obligation becomes due and payable;
(c) Indebtedness existing on the Closing Date and set forth in
Schedule 8.05;
(d) unsecured Indebtedness not otherwise permitted under this
Section_8.05 and Indebtedness secured by Liens permitted by subsections 8.01(i),
(j), (n) and (p) in an aggregate amount outstanding not to exceed $25,000,000 at
any time;
(e) Indebtedness evidenced by the 1997 Senior Notes and the guarantee
thereof by the Subsidiary Guarantors;
(f) Indebtedness incurred in connection with leases permitted
pursuant to Section 8.10;
(g) Indebtedness permitted under subsections_8.04(c) and 8.04(g);
(h) Indebtedness under the AIP Bridge Loan which becomes an
obligation of the Company upon the effectiveness of the BAC Merger;
provided that such Indebtedness was incurred by BAC solely to pay
the amounts owed to former shareholders of the Company pursuant to
the provisions of the AIP Merger Agreement
and the principal amount of such Indebtedness does not exceed the amount paid by
BAC to such shareholders minus the $143,000,000 equity infusion of AIP into BAC;
provided further that, unless a Default or Event of Default exists at the
effective time of the BAC Merger, the Company shall immediately repay such
Indebtedness; and
(i) secured Indebtedness of domestic Subsidiaries which are not
Subsidiary Guarantors; provided that the aggregate amount of such Indebtedness
shall not exceed $3,000,000 at any time.
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 (a) 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,
(b) the Company may pay an advisory fee of $4,000,000 to AIP upon
completion of the
BAC Merger, (c) the Company may enter into a management services agreement with
AIP providing for the payment of up to $1,500,000 per year in management
fees and
the reimbursement of expenses to AIP and its Affiliates by the Company and its
Subsidiaries and (d) the Company and its Subsidiaries may make the
Investments in
Subsidiaries permitted under Section_8.08 and the Company may otherwise conduct
business with its Subsidiaries in a manner consistent with past practices.
8.07 Use of Proceeds. Except for the AIP Purchase, the Company shall not,
and shall not suffer or permit any 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 domestic Subsidiary to, create, incur, assume or suffer to
exist any Contingent Obligations except:
(a) endorsements for collection or deposit in the ordinary course of
business;
(b) Permitted Swap Obligations;
(c) Contingent Obligations of the Company and its domestic
Subsidiaries existing as of the Closing Date and listed in Schedule 8.08;
(d) Contingent Obligations with respect to Surety Instruments
incurred in the ordinary course of business and not exceeding at any time
$25,000,000 in the aggregate in respect of the Company and its domestic
Subsidiaries together; and
(e) Guaranty Obligations incurred by the Company with respect to the
lease by a customer of the Company from a third party of a product manufactured
by the Company and sold to such third party, provided that the aggregate amount
of such Guaranty Obligations outstanding, together with the aggregate principal
amount of Indebtedness secured by Liens permitted under subsection_8.01(n)
shall not exceed $10,000,000 at any time.
8.09 Joint Ventures. The Company shall not, and shall not suffer or permit
any Subsidiary to enter into any Joint Venture, other than in the ordinary
course of business and in the same or related line of business as
currently conducted by the Company or such Subsidiary.
8.10 Lease Obligations. The Company shall not, and shall not suffer or
permit any Subsidiary to, create or suffer to exist any obligations for the
payment of rent for any property under lease or agreement to lease, except for:
(a) leases of the Company and of Subsidiaries in existence on the
Closing Date (including those assumed by the Company pursuant to the Xxxxxx
Acquisition) and any renewal, extension or refinancing thereof;
(b) operating leases entered into by the Company or any Subsidiary
after the Closing Date in the ordinary course of business; provided that the
aggregate annual rental payments by the Company and its Subsidiaries pursuant to
operating leases (including operating leases permitted under clause
(a)) shall not exceed $8,000,000 during any fiscal year; and ;
(c) capital leases other than those permitted under clause (a) of
this Section, entered into by the Company or any Subsidiary after the Closing
Date to finance the acquisition of equipment; provided that the aggregate
annual rental payments for all such capital leases shall not exceed
$500,000 in any fiscal year.
8.11 Restricted Payments. 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, 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 the Company and any Wholly-Owned Subsidiary may:
(a) declare and make dividend payments or other distributions
payable solely in its common stock and may declare and pay dividends payable to
the Company or any Wholly-Owned Subsidiary;
(b) purchase, redeem or otherwise acquire shares of its common stock
or warrants or options to acquire any such shares with the proceeds received
from
the substantially concurrent issue of new shares of its common stock; and
(c) consummate the Option Repurchase and may, if the Short Form
Merger is not effected on the Closing Date, pay cash consideration to its former
shareholders upon the completion of the BAC Merger in accordance with the AIP
Merger Agreement.
8.12 ERISA. The Company shall not, and shall not suffer or permit any of
its ERISA Affiliates to: (a) engage in a prohibited transaction or violation of
the fiduciary responsibility rules with respect to any Plan which has resulted
or could reasonably expected to result in liability of the Company in an
aggregate amount in excess of $500,000; or (b) engage in a transaction that
could be subject to Section 4069 or 4212(c) of ERISA.
8.13 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.
8.14 Accounting Changes. The Company shall not, and shall not suffer or
permit any Subsidiary to
(a) make any significant change in accounting treatment or reporting
practices, except as required by GAAP; (b) change the fiscal year of the Company
or of any Subsidiary; or (c) change in any material respect the manner of
calculating the Obsolescence Reserve or the Service and Erection Accrual or the
designation of certain accounts receivable as Claim status, or change the
practices historically followed by Company in applying credit memos against
account receivables, except as required by GAAP. The Company shall promptly
notify the Agent if the Company makes any change permitted under clauses (a) or
(c) above.
8.15 Redemption of 1997 Senior Notes. The Company shall not:
(a) prepay, redeem, purchase or otherwise acquire, any of the 1997
Senior Notes unless the consent of the Majority Banks (or, if a Default or Event
of Default exists, all the Banks) is obtained, provided that if no ABL Trigger
Event has occurred and is continuing and no Default or Event of Default exists,
the Company may use the proceeds obtained from a public offering of the
Company s common stock to redeem up to 34% of the 1997 Senior Notes in
accordance with Section_5 of the 1997 Senior Notes; or
(b) agree to any amendment to any of the Senior Note Documents which
would (i) provide collateral for the 1997 Senior Notes, (ii) increase the
interest rate on the 1997_Senior Notes, (iii) change the principal payment date
of or redemption provisions applicable to the 1997_Senior Notes, (iv) impose any
financial covenant which, if not satisfied , could result in a default under the
Senior Note Indenture, (v) amend any event of default in the Senior Note
Indenture which would make it more likely that, or increase the events or
circumstances under which, an event of default thereunder would occur or (vi)
otherwise materially and adversely affect the Banks, unless the prior written
consent of all of the Banks is obtained, or agree to any other amendment of the
Senior Note Documents unless the prior written consent of the Majority Banks is
obtained.
8.16 Financial Covenants.
(a) Adjusted Funded Debt to EBITDA Ratio. The Company shall not
permit the Adjusted Funded Debt to EBITDA Ratio, as of the end of any fiscal
quarter set forth in the following table, to exceed the corresponding ratio:
Date Ratio
December 31, 1997 8.50:1.0
March 31, 1998 7.60:1.0
June 30, 1998 7.20:1.0
September 30, 1998 6.60:1.0
December 31, 1998 6.25:1.0
March 31, 1999 6.20:1.0
June 30, 1999 5.90:1.0
September 30, 1999 5.50:1.0
December 31, 1999 5.25:1.0
March 31, 2000 5.00:1.0
June 30, 2000 5.00:1.0
Each fiscal quarter thereafter 4.75:1.0
(b) Fixed Charge Coverage Ratio. The Company shall not permit the
Fixed Charge Coverage Ratio, as of the end of any fiscal quarter set
forth in the following table, to be less than the corresponding ratio:
Date Ratio
December 31, 1997 1.10:1.0
March 31, 1998 1.10:1.0
June 30, 1998 1.10:1.0
September 30, 1998 1.30:1.0
December 31, 1998 1.35:1.0
March 31, 1999 1.40:1.0
June 30, 1999 1.45:1.0
September 30, 1999 1.45:1.0
December 31, 1999 1.45:1.0
Each fiscal quarter thereafter 1.50:1.0
(c) Interest Coverage Ratio. The Company shall not permit the
Interest Coverage Ratio, as of the end of any fiscal quarter set forth in the
following table, to be less than the corresponding ratio:
Date Ratio
December 31, 1997 1.50:1.0
March 31, 1998 1.50:1.0
June 30, 1998 1.50:1.0
September 30, 1998 1.60:1.0
December 31, 1998 1.70:1.0
March 31, 1999 1.80:1.0
June 30, 1999 1.95:1.0
September 30, 1999 2.05:1.0
Each fiscal quarter thereafter 2.15:1.0
(d) Net Worth. The Company shall not permit Net Worth as of
December_31, 1997 to be less than $110,000,000 or as of the end of any
subsequent
fiscal year to be less than (i) $110,000,00 plus (ii) 50% of Net Earnings during
the period from January_1, 1998 to the date of determination (treated as a
single
accounting period with no reduction due to a net loss for any fiscal year);
provided, however, that if (a) the BAC Merger has not occurred by December_31,
1997, the Net Worth of BAC shall be added to the Net Worth of the Company and
its consolidated Subsidiaries for purposes of determining compliance with the
December_31, 1997 minimum Net Worth requirement and (b) amounts paid by the
Company after January_1, 1998 to effect the Option Repurchase shall be
disregarded for purposes, of computing Net Earnings under this section.
8.17 Capital Expenditures. The Company shall not, and shall not permit any
Subsidiary to, make any Capital Expenditure if, as a result thereof, the
aggregate Capital Expenditures by the Company and its Subsidiaries would exceed
(a) $6,000,000 during the fiscal year ending December_31, 1997, (b) $12,000,000
during each of the next two fiscal years or (c) $7,500,000 during any subsequent
fiscal year; provided that if (1) no Default or Event of Default exists and (2)
the Capital Expenditures relates to the Company s plant modernization program,
then the Company may (Y) exceed the amounts in clauses (a) and (b) above so long
as the aggregate Capital Expenditures made by the Company and its Subsidiaries
during the three fiscal year period ending December 31, 1999 does not exceed
$30,000,000 and (Z) exceed the amount in clause (c) above to the extent
necessary to complete the plant modernization program so long as
the amount of such excess,
when added to the aggregate Capital Expenditures made by the Company and its
Subsidiaries during the three fiscal year period ending December_31, 1999, does
not exceed_$30,000,000.
8.18 Western Gear. The Company shall not, and shall not permit any
Subsidiary to, make any Investment in, repay any loan from or otherwise
transfer, directly or indirectly, any value to Western Gear Machinery Co.
ARTICLE IX
EVENTS OF DEFAULT
9.01 Event of Default. Any of the following shall constitute an Event of
Default :
(a) Non-Payment. The Company 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
the Company or any Subsidiary made or deemed made herein, in any other Loan
Document, or which is contained in any certificate, document or financial or
other statement by the Company, any Subsidiary, 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. The Company fails to perform or observe any
term, covenant or agreement contained in Article VIII; or
(d) Other Defaults. The Company or any Subsidiary party thereto
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 30 days (or in the case of Sections_7.01, 7.02, 7.03 and 7.09
five 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 Bank; or
(e) Cross-Default. (i)_The Company or any Subsidiary (A)_fails to
make any payment in respect of any Indebtedness or Contingent Obligation (other
than in respect of Swap Contracts) having an aggregate principal amount
(including undrawn combined or available amounts and including amounts owing to
all creditors under any available combined or syndicated credit arrangement) of
more than $5,000,000 when due; 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 or Contingent
Obligation, 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 (ii)
there occurs a Default or Event of Default (as defined therein) under the
Senior Note Indenture; or (iii)_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 $2,000,000;
or
(f) Insolvency; Voluntary Proceedings. The Company, any Material
Domestic Subsidiary or any Material Foreign Subsidiary (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, any Material Domestic
Subsidiary or any Material Foreign Subsidiary, or any writ, judgment, warrant of
attachment, execution or similar process, is issued or levied against a
substantial part of the Company's, any Material Domestic Subsidiary's or any
Material Foreign Subsidiary s 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 Material Domestic
Subsidiary or any Material Foreign Subsidiary 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, any Material Domestic Subsidiary or any Material Foreign
Subsidiary 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 $1,000,000;
(ii) the aggregate amount of Unfunded Pension Liability among all Pension Plans
at any time exceeds $1,000,000 and the Company or applicable ERISA Affiliate has
failed to timely make such contributions as are required under ERISA with
respect
thereto; 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 $1,000,000; 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 Guarantor 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 $2,000,000 or more, and the same shall
remain unsatisfied, unvacated and unstayed pending appeal for a period of 30
days after the entry; 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) Change of Control. There occurs any Change of Control; or
(l) Subsidiary Guarantor Defaults. A Subsidiary Guarantor fails in
any material respect to perform or observe any term, covenant or agreement in
the
Subsidiary Guaranty to which it is a party; or such Subsidiary 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
such Subsidiary Guarantor or any Affiliate of such Subsidiary Guarantor 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
subsections
(f) or (g) of this Section occurs with respect to a Subsidiary Guarantor; or
9.02 Remedies. If any Event of Default occurs, the Agent shall, at the
request of, or may, with the consent of, the Majority Banks,
(a) declare the Commitment of each Bank to make Loans and any
obligation of the Issuing Bank 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 Banks all rights and
remedies available to it and the Banks under the Loan Documents or applicable
law;
provided, however, that upon the occurrence of any event specified in subsection
(f) or (g) of Section 9.01 (in the case of clause (i) of subsection (g) upon the
expiration of the 60-day period mentioned therein), the obligation of each Bank
to make Loans and any obligation of the Issuing Bank 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 Bank or any Bank.
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.
9.04 Certain Financial Covenant Defaults. In the event that, after taking
into account any extraordinary charge to earnings taken or to be taken as of the
end of any fiscal period of the Company (a Charge ), and if solely by virtue of
such Charge, there would exist an Event of Default due to the breach of
Section_8.16(d) as of such fiscal period end date, such Event of Default shall
be deemed to arise upon the earlier of (a) the date after such fiscal period end
date on which the Company announces publicly it will take, is taking or has
taken
such Charge (including an announcement in the form of a statement in a report
filed with the SEC) or, if such announcement is made prior to such fiscal period
end date, the date that is such fiscal period end date, and (b) the date the
Company delivers to the Agent its audited annual or unaudited quarterly
financial
statements in respect of such fiscal period reflecting such Charge as taken.
ARTICLE X
THE AGENT
10.01 Appointment and Authorization; Agent . (a) Each Bank hereby
irrevocably (subject to Section 10.09) appoints, designates and authorizes the
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 Bank, 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 Bank shall act on behalf of the Banks 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 Bank with respect thereto;
provided,
however, that the Issuing Bank 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 Bank 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 Bank with respect to
such acts or omissions, and (ii)_as additionally provided in this Agreement with
respect to the Issuing Bank.
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 Banks 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 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 Bank 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 Banks as it deems appropriate (or, if
the consent of all Banks is required under Section 11.01, the Agent receives
such
consents) and, if it so requests, it shall first be indemnified to its
satisfaction by the Banks against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such action. The
Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement or any other Loan Document in accordance with a
request or consent of the Majority Banks (or, if required under Section_11.01,
all Banks) and such request and any action taken or failure to act pursuant
thereto shall be binding upon all of the Banks.
(b) For purposes of determining compliance with the conditions
specified in Section 5.01, each Bank that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent by the Agent to such Bank for consent,
approval, acceptance or satisfaction, or required thereunder to be consented to
or approved by or acceptable or satisfactory to the Bank.
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 Banks, unless the Agent shall have
received written notice from a Bank 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 Banks 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 Banks 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 Banks.
10.06 Credit Decision. Each Bank 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 Bank. Each Bank 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, 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 Bank 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 Banks by the Agent, the Agent shall not have any duty or
responsibility to provide any Bank 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. The Agent agrees that, promptly following
receipt of the financial statements, certificates and notices described in
Sections_7.01, 7.02 and 7.03, it will furnish a copy thereof to each Bank.
10.07 Indemnification of Agent. Whether or not the transactions
contemplated hereby are consummated, the Banks 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
Bank 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 Bank
shall reimburse the Agent upon demand for its ratable share of any 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. Bank One 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 Bank One were not the Agent or the Issuing
Bank hereunder and without notice to or consent of the Banks. The Banks
acknowledge that, pursuant to such activities, Bank One 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, Bank
One shall have the same rights and powers under this Agreement as any other Bank
and may exercise the same as though it were not the Agent or the Issuing Bank.
10.09 Successor Agent. The Agent may, and at the request of the Majority
Banks shall, resign as Agent upon 30 days' notice to the Banks. If the Agent
resigns under this Agreement, the Majority Banks shall appoint from among the
Banks a successor agent for the Banks. 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 Banks and the Company, a successor agent from among
the Banks. 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 Banks
shall perform all of the duties of the Agent hereunder until such time, if any,
as the Majority Banks appoint a successor agent as provided for above.
Notwithstanding the foregoing, however, Bank One may not be removed as the Agent
at the request of the Majority Banks unless Bank One shall also simultaneously
be replaced as Issuing Bank hereunder pursuant to documentation in form and
substance reasonably satisfactory to Bank One.
10.10 Withholding Tax. (a) If any Bank is a foreign corporation,
partnership or trust within the meaning of the Code and such Bank claims
exemption from, or a reduction of, U.S. withholding tax under Sections 1441 or
1442 of the Code, such Bank agrees with and in favor of the Agent, to deliver to
the Agent:
(i) if such Bank 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 1001 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 Bank 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 Bank, two properly
completed and executed copies of IRS Form 4224 before the payment of any
interest is due in the first taxable year of such Bank and in each
succeeding taxable year of such Bank 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 Bank agrees to promptly notify the Agent of any change in circumstances
which would modify or render invalid any claimed exemption or reduction.
(b) If any Bank claims exemption from, or reduction of, withholding
tax under a United States tax treaty by providing IRS Form 1001 and such Bank
sells, assigns, grants a participation in, or otherwise transfers all or part of
the Obligations of the Company to such Bank, such Bank 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 Bank. To the extent of such percentage
amount, the Agent will treat such Bank's IRS Form 1001 as no longer valid.
(c) If any Bank claiming exemption from United States withholding
tax by filing IRS Form 4224 with the Agent sells, assigns, grants a
participation
in, or otherwise transfers all or part of the Obligations of the Company to such
Bank, such Bank agrees to undertake sole responsibility for complying with the
withholding tax requirements imposed by Sections 1441 and 1442 of the Code.
(d) If any Bank is entitled to a reduction in the applicable
withholding tax, the Agent may withhold from any interest payment to such Bank
an amount equivalent to the applicable withholding tax after taking into account
such reduction. However, if the forms or other documentation required by
subsection (a) of this Section are not delivered to the Agent, then the Agent
may withhold from any interest payment to such Bank 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 Bank (because the
appropriate form was not delivered or was not properly executed, or because such
Bank 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 Bank 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 Banks under this subsection
shall survive the payment of all Obligations and the resignation or replacement
of the Agent.
10.11 Documentation Agent. The Bank identified on the facing page and
signature pages of this Agreement as the documentation agent shall have no
right, power, obligation, liability, responsibility or duty under this Agreement
other than those applicable to all Banks as such. Without limiting the
foregoing, such Bank so identified shall not have or be deemed to have any
fiduciary relationship with any Bank. Each Bank acknowledges that it has not
relied, and will not rely, on the Bank so identified in deciding to enter into
this Agreement or in taking or not taking action hereunder.
ARTICLE XI
MISCELLANEOUS
11.01 Amendments and Waivers. 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 Subsidiary Guarantor therefrom, shall be
effective unless the same shall be in writing and signed by the Majority Banks
(or by the Agent at the written request of the Majority Banks) 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 Banks and the Company and acknowledged
by the Agent, do any of the following:
(a) increase or extend the Commitment of any Bank (or reinstate any
Commitment terminated pursuant to Section 9.02);
(b) postpone or delay any date fixed by this Agreement or any other
Loan Document for any payment or prepayment of principal, interest, fees or
other amounts due to the Banks (or any of them) hereunder or under any
other Loan Document;
(c) reduce the principal of, or the rate of interest specified
herein on any Loan, or (subject to clause (iii) below) any fees or other amounts
payable hereunder or under any other Loan Document;
(d) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Loans which is required for the Banks or any of
them to take any action hereunder;
(e) amend this Section, or Section 2.14 or Section_3.07, or any
provision herein providing for consent or other action by all Banks; or
(f) release a Subsidiary Guarantor from its obligations under a
Subsidiary Guaranty or release the Lien created by a Security Document in
assets
of the Company or a Subsidiary Guarantor other than as permitted in this
Agreement or in such Security Document;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the Issuing Bank in addition to the Majority Banks or all
the Banks, as the case may be, affect the rights or duties of the Issuing Bank
under this Agreement or any L/C-Related Document relating to any Letter of
Credit
Issued or to be Issued by it, (ii) no amendment, waiver or consent shall, unless
in writing and signed by the Agent in addition to the Majority Banks or all the
Banks, as the case may be, affect the rights or duties of the Agent under this
Agreement or any other Loan Document, and (iii) the Fee Letter may be amended,
or rights or privileges thereunder waived, in a writing executed by the parties
thereto.
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 the Company 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 Bank shall not be effective until actually received by the Issuing Bank
at the address specified for the Issuing Bank on Schedule 11.02.
(c) Any agreement of the Agent and the Banks 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 Banks 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 Banks 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 Banks 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 Banks to receive written confirmation of any telephonic or facsimile notice
or the receipt by the Agent and the Banks of a confirmation which is at variance
with the terms understood by the Agent and the Banks 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 Bank, 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 Bank One (including in its capacity as Agent and
Issuing Bank) within five Business Days after demand (subject to subsection
5.01(o)) for all costs and expenses incurred by Bank One (including in its
capacity as Agent and Issuing Bank) in connection with the development,
preparation, delivery, 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 Bank One
(including in its capacity as Agent and Issuing Bank) with respect thereto; and
(b) pay or reimburse the Agent, the Arranger and each Bank within
five Business Days after demand (subject to subsection 5.01(o)) for all 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).
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 Bank 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
Bank)
be imposed on, incurred by or asserted against any such Person in any way
relating to or arising out of 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 Banks, or the Agent or the Banks 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 Bank 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 Bank
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 Bank.
11.08 Assignments, Participations, etc. (a) Any Bank may, with the written
consent of the Company at all times other than during the existence of an Event
of Default and the Agent and the Issuing Bank, which consents shall not be
unreasonably withheld, at any time assign and delegate to one or more Eligible
Assignees (provided that no written consent of the Company, the Agent or the
Issuing Bank shall be required in connection with any assignment and delegation
by a Bank to an Eligible Assignee that is an Affiliate of such Bank) (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 Bank hereunder, in
a minimum amount of $5,000,000; provided, however, that the Company and
the Agent
may continue to deal solely and directly with such Bank 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 Bank and the Assignee; (ii)_such Bank and its Assignee shall have delivered
to the Company and the Agent an Assignment and Acceptance in the form of Exhibit
E ( Assignment and Acceptance ) together with any Note or Notes subject to such
assignment and (iii) the assignor Bank 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
Bank 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 Bank under the Loan
Documents, and (ii) the assignor Bank 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 subsection 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 Bank has retained a portion of its Loans and its
Commitment,
replacement Notes in the principal amount of the Loans retained by the assignor
Bank (such Notes to be in exchange for, but not in payment of, the Notes held by
such Bank). 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 Bank pro tanto.
(d) Any Bank may at any time sell to one or more commercial banks
or other Persons not Affiliates of the Company (a Participant ) participating
interests in any Loans, the Commitment of that Bank and the other interests of
that Bank (the originating Bank ) hereunder and under the other Loan Documents;
provided, however, that (i)_the originating Bank's obligations under this
Agreement shall remain unchanged, (ii)_the originating Bank shall remain solely
responsible for the performance of such obligations, (iii)_the Company, the
Issuing Bank and the Agent shall continue to deal solely and directly with the
originating Bank in connection with the originating Bank's rights and
obligations
under this Agreement and the other Loan Documents, and (iv)_no Bank 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 Banks 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 Bank 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 Bank under this Agreement.
(e) Notwithstanding any other provision in this Agreement, any Bank
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 Section 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 Bank 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 Bank, 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 Bank; provided, however, that any Bank may disclose such
information (A) at the request or pursuant to any requirement of any
Governmental
Authority to which the Bank is subject or in connection with an examination of
such Bank by any such authority; (B) pursuant to 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 Bank 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 Bank'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 Banks hereunder; (H) as to any Bank 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 Bank
or such Affiliate; and (I) to its Affiliates.
11.10 Set-off. In addition to any rights and remedies of the Banks
provided by law, if an Event of Default exists or the Loans have been
accelerated, each Bank is authorized at any time and from time to time, without
prior notice to the Company, any such notice being waived by the Company 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 Bank to or for the credit or
the account of the Company against any and all Obligations owing to such Bank,
now or hereafter existing, irrespective of whether or not the Agent or such Bank
shall have made demand under this Agreement or any Loan Document and although
such Obligations may be contingent or unmatured. Each Bank agrees promptly to
notify the Company and the Agent after any such set-off and application made by
such Bank; provided, however, that the failure to give such notice shall not
affect the validity of such set-off and application.
11.11 Automatic Debits of Fees. With respect to any commitment fee,
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 Bank, or
the Arranger under the Loan Documents, the Company hereby
irrevocably authorizes Bank
One to debit any deposit account of the Company with Bank One 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 Bank One'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 Bank shall
notify the Agent in writing of any changes in the address to which notices
to the
Bank should be directed, of addresses of any Lending Office, 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 Company, the Banks, 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 OTHER
LOAN DOCUMENTS SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW
OF THE STATE OF WISCONSIN; PROVIDED THAT THE AGENT AND THE BANKS 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
WISCONSIN
OR OF THE UNITED STATES FOR THE EASTERN DISTRICT OF WISCONSIN, AND BY EXECUTION
AND DELIVERY OF THIS AGREEMENT, EACH OF THE COMPANY, THE AGENT AND THE BANKS
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF THE COMPANY, THE AGENT AND THE BANKS
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. THE COMPANY, THE AGENT AND
THE BANKS EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR
OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY WISCONSIN
LAW.
11.17 Waiver of Jury Trial. THE COMPANY, THE BANKS AND THE AGENT EACH
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 COMPANY, THE
BANKS 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 Entire Agreement. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the Company,
the Banks 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.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered in Milwaukee, Wisconsin by their proper and duly
authorized officers as of the day and year first above written.
BUCYRUS INTERNATIONAL, INC.
BY
Title:
BANK ONE, WISCONSIN, as Agent
BY
Title:
BANK ONE, WISCONSIN, as Issuing Bank
BY
Title:
THE BANK OF NOVA SCOTIA, as
Documentation Agent
BY
Title:
BANK ONE, WISCONSIN, as a Bank
BY
Title:
THE BANK OF NOVA SCOTIA, as a Bank
BY
Title:
FIRSTAR BANK MILWAUKEE, N.A.
BY
Title:
FLEET CAPITAL CORPORATION
BY
Title:
LASALLE NATIONAL BANK
BY
Title:
BANK OF SCOTLAND
BY
Title:
