AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT is dated as of September 5, 2000
and is made by and among XXXXXXXXX FOODS VENTURE, L. P., a Texas limited
partnership (the "Borrower"), each of the Guarantors (as hereinafter defined),
the BANKS (as hereinafter defined), and PNC BANK, NATIONAL ASSOCIATION, in its
capacity as agent for the Banks under this Agreement (hereinafter referred to in
such capacity as the "Agent").
WITNESSETH:
WHEREAS, the Borrower has requested the Banks to: (i)provide a revolving
credit facility to the Borrower in an aggregate principal amount not to exceed
$2,500,000, (ii)extend the maturity date of a $574,604.89 term loan facility,
(iii)extend the maturity date of a $3,177,806.99 terin loan. facility, and
(iv)to provide a new $l, OOO, OOO term loan facility.
WHEREAS, the revolving credit and term loan facilities shall be used for
working capital; and
WHEREAS, the Banks are willing to provide such credit upon the terms and
conditions hereinafter set forth;
NOW, THEREFORE, the parties hereto, in consideration of their mutual
covenants and agreements hereinafter set forth and intending to be legally bound
hereby, covenant and agree as follows:
1. CERTAIN DEFINITIONS.
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1.1 Certain Definitions. In addition to words and terms defined elsewhere
in this Agreement, the following words and terms shall have the
following meanings, respectively, unless the context hereof clearly
requires otherwise:
1.1.1 Affiliate as to any Person shall mean any other Person (i)which
directly or indirectly controls, is controlled by, or is under common
control with such Person, (ii)which beneficially owns or holds 5%or
more of any class of the voting or other equity interests of such
Person, or (iii)5%or more of any class of voting interests or other
equity interests of which is beneficially owned or held, directly or
indirectly, by such Person. Control, as used in this definition, shall
mean the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract or otherwise,
including the power to elect a majority of the directors or trustees
of a corporation or trust, as the case may be.
1.1.2 Amicultural Liens shall mean any liens arising under Section 13 11.55
of the Ohio Revised Code which lien has been perfected in accordance
with Section 13 11.56 of the Ohio Revised Code.
1.1.3 Agent shall mean PNC Bank, National Association, and its successors
and assigns.
1.1.4 Avreement shall mean this Amended and Restated Credit Agreement, as
the same may be supplemented or amended from time to time, including
all schedules and exhibits.
1.1.5 Annual Statements 'shall have the meaning assigned to that term in
Section 6.1.8.1.
1.1.6 Assbnment and Assumption Agreement shall mean an Assignment and
Assumption Agreement by, among a Purchasing Bank, a Transferor Bank
and the Agent, as Agent, and on behalf of the remaining Banks,
substantially in the form of Exhibit l-l(A).
1.1.7 Authorized Offbzer shall mean those individuals, designated by
written notice to the Agent f? om the Borrower, authorized to execute
notices, reports and other documents on behalf of the Loan Parties
required hereunder. The Borrower may amend such list of individuals
from time to time by giving written notice of such amendment to the
Agent.
1.1.8 Banks shall mean the financial institutions named on Schedule 1.1
(B)and their respective successors and assigns as permitted hereunder,
each of which is referred to herein as a Bank.
1.1.9 Base Rate shall mean the interest rate per annum announced from time
to time by the Agent at its Principal Office as its then prime rate,
which rate may not be the lowest rate then being charged commercial
borrowers by the Agent.
1.1.10 Benefit Arrangement shall mean at any time an "employee benefit
plan," within the meaning of Section 3(3)of ERISA, which is neither a
Plan nor a Multiemployer Plan and which is maintained, sponsored or
otherwise contributed to by any member of the ERISA Group.
1.1.11 Borrower shall mean Xxxxxxxxx Foods Venture, L. P., a limited
partnership organized and existing under the laws of the State of
Texas.
1.1.12 Borrowing Base shall mean an amount equal to the sum of(i)85%of the
net amount of Eligible Accounts Receivable plus (ii)50%of the value of
Borrower's Eligible Inventory.
1.1.13 Borrowing Base Certificate shall mean the Borrowing Base Certificate
in the form shown on attached Exhibit 1.1(B)delivered by Agent to the
Borrower in connection with the Closing of &is Agreement, in
connection with each Loan Request, and all amendments thereto and
revisions thereof required by the Agent.
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1.1.14 Borrowinp Date shall mean, with respect to any Loan, the date for
the making thereof or the renewal, which shall be a Business Day.
1.1.15 Business Dav shall mean any day other than a Saturday or Sunday or a
legal holiday on which commercial banks are authorized or required to
be closed for business in Cincinnati, Ohio and, if the applicable
Business Day relates to any Loan to which the Euro-Rate Option
applies, such day must also be a day on which dealings are carried on
in the London interbank market.
1.1.16 Cash Flow from Operations for any period of determination shall mean
(i)the sum of net income, depreciation, amortization, other non-cash
charges to net income, interest expense and income tax expense minus
(ii) non-cash credits to net income, in each case of the Borrower and
its Subsidiaries for such period determined and consolidated in
accordance with GAAP.
1.1.17 Closinp Date shall mean the date on which this Credit Agreement is
executed.
1.1.18 Collateral shall mean the Life Insurance Collateral, the UCC
Collateral, and the Real Property.
1.1.19 Commitment shall mean as to any Bank the aggregate of its Revolving
Credit Commitment and Term Loan Commitment, and Commitments shall mean
the aggregate of the Revolving Credit Commitments and Term Loan
Commitments of all of the Banks.
1.1.20 Compliance Certificate shall have the meaning assigned to such term
in Section 8.3.4.
1.1.21 Contamination shall mean the presence of release or threat of
release of Regulated Substances in, on, under or emanating to or from
the Property, which pursuant to Environmental Laws requires
notification or reporting to an Official Body, or which pursuant to
Environmental Laws requires the investigation, cleanup, removal,
remediation, containment, abatement of or other response action or
which otherwise constitutes a violation of Environmental Laws.
1.1.22 Current Assets shall mean the current assets of Borrower less the
account receivable representing the debt owed by Xxxxxxxxx Partners,
L. P. to Borrower.
1.1.23 Current Maturities of Long Term Debt shall mean that portion of the
principal amount of Long Term Debt which must be repaid during the
twelve fiscal months following the date on which the determination is
being made plus capitalized lease obligations.
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1.1.24 Debt Rating shall mean the rating of the Borrower's senior unsecured
long-term debt by each of Standard &Poor's and Moody's.
1.1.25 Dollar, Dollars, U. S. Dollars and the symbol $shall mean lawful
money of the United States of America.
1.1.26 EBITDA will mean operating income (or loss)before interest expenses,
tax expenses, depreciation and amortization expenses
1.1.27 EliPible Accounts Receivable shall mean those receivables of
Borrower which the Agent deem, in its reasonable business judgment, to
be acceptable to Agent, including, without limitation those accounts
receivable aged less than 30 days as of the disbursement of any
advance under the Revolving Loans.
1.1.28 Elipible Inventory shall mean all meat inventories of Borrower
reasonably acceptable to Agent, less the amount of any Agricultural
Liens filed against such inventory.
1.1.29 Environmental Complaint shall mean any written complaint by any
Person or Official Body setting forth a cause of action for personal
injury or property damage, natural resource damage, contribution or
indemnity for response costs, civil or administrative penalties,
criminal fines or penalties, or declaratory or equitable relief
arising under any Environmental Law or any order, notice of violation,
citation, subpoena, request for information or other written notice or
demand of any type by an Official Body pursuant to any Environmental
Laws.
1.1.30 Environmental Conditions shall mean any conditions of the
environment, including the workplace, the ocean, natural resources
(including flora or fauna), soil, surface water, groundwater, any
actual or potential drinking water supply sources, substrata or the
ambient air, relating to or arising out of, or caused by, the use,
handling, storage, treatment, recycling, generation, transportation,
release, spilling, leaking, pumping, emptying, discharging, injecting,
escaping, leaching, disposal, dumping, threatened release or other
management or mismanagement of Regulated Substances resulting from the
use of, or operations on, any Property.
1.1.31 Environmental Laws shall mean all federal, state, local and foreign
Laws and any consent decrees, settlement agreements, judgments,
orders, directories, policies or programs issued by or entered into
with an Official Body pertaining or relating to: (i)pollution or
pollution control; (ii) protection of human health or the environment;
(iii)employee safety in the workplace; (iv)the presence, use,
management, generation, manufacture, processing, extraction, treatment
recycling, refining, reclamation, labeling, transport, storage,
collection, distribution, disposal or release of threat of
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Regulated Substances; (v)the presence of Contamination; (vi)the
protection of endangered or threatened species, and (vii)the
protection of Environmentally Sensitive Areas.
1.1.32 Environmentally Sensitive Area shall mean (i)any wetland as defined
by applicable Environmental Laws; (ii)any area designated as a coastal
zone pursuant to applicable Laws, including Environmental Laws;
(iii)any area of historic or archeological significance or scenic area
as defined or designated by applicable Laws, including Environmental
Laws; (iv) habitats of endangered species or threatened species as
designated by applicable Laws, including Environmental Laws; or (v)a
floodplain or other flood hazard area as defined pursuant to any
applicable Laws.
1.1.33 ERISA shall mean the Employee Retirement Income Security Act of
1974, as the same may be amended or supplemented tiom time to time,
and any successor statute of similar import, and the rules and
regulations thereunder, as from time to time in effect.
1.1.34 ERISA Groue shall mean, at any time, the Borrower and all members of
a controlled group of corporations and all trades or businesses
(whether or not incorporated)under common control and all other
entities which, together with the Borrower, are treated as a single
employer under Section 4 14 of the Internal Revenue Code.
1.1.35 Euro-Rate shall mean the interest rate per annum determined by Agent
by dividing (the resulting quotient rounded upward to the nearest
1000th of 1%per annum)(i)the rate of interest determined by Agent in
accordance with its usual procedures (which determination will be
conclusive absent manifest error)to be the "ask" eurodollar rate
evidenced by Telerate page 3 14 as quoted by Xxxxxx, Astley &Pierce
(or appropriate successor, or, if Xxxxxx, Astley &Pierce or its
successor ceases to provide such quotes, a comparable replacement as
determined by Agent)two (2)Business Days prior to the first day of
such Interest Period for an amount comparable to such Advance and
having a borrowing date and a maturity comparable to such Interest
Period, by (ii)a number equal to 1.00 minus the Euro-Rate Reserve
Percentage.
The Euro-Rate ,may also be expressed by the following formula:
Telerate page 3 14 quoted by Xxxxxx,
Euro-Rate = Astley & Xxxxxx or aupropriate successor
1 .OO - Euro-Rate Reserve Percentage
1.1.36 Euro Rate Interest Period shall mean one (I)month.
1.1.37 Euro-Rate Reserve Percentage shall mean as of any day the maximum
percentage in effect on such day: (i)as prescribed by the Board of
Governors of the Federal Reserve System (or any successor)for
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determining the reserve requirements (including supplemental, marginal
and emergency reserve requirements)with respect to eurocurrency
fbnding (currently referred to as "Eurocurrency Liabilities"); and
(ii). to be maintained by a Bank as required for reserve liquidity,
special deposit, or a similar purpose by an govemmental or monetary
authority of any country or political subdivision thereof (including
any central bank), against (A)any category of liabilities that
includes deposits by reference to which a Euro-Rate is to be
determined, or (B)any category of extension of credit or other assets
that includes Loans or Borrowing Tranches to which a Euro-Rate
applies.
1.1.38 Event of Default shall mean any of the events described in Section
9.1 and referred to therein as an "Event of Default."
1.1.39 Excess Cash Flow shall be computed as of the close of each fiscal
year by taking the difference between Cash Flow fioni Operations for
such fiscal year and Fixed Charges for such fiscal year. All
determinations of Excess Cash Flow shall be based on the immediately
preceding fiscal year and shall be made following the delivery by the
Borrower to the Agent of the Borrower's audited financial statements
for such preceding year.
1.1.40 Expiration Date shall mean, (i)with respect to the Revolving Credit
Commitments, January 3 1, 2001, (ii)with respect to the Term Loan
Commitments, December 3 1,200l.
1.1.41 Federal Funds Effective Rate for any day shall mean the rate per
annum (based on a year of 360 days and actual days elapsed and rounded
upward to the nearest l/l 00 of 1%)announced by the Federal Reserve
Bank of New York (or any successor)on such day as being the weighted
average of the rates on overnight federal funds transactions arranged
by federal funds brokers on the previous trading day, as computed and
announced by such Federal Reserve Bank (or any successor)in
substantially the same manner as such Federal Reserve Bank computes
and announces the weighted average it refers to as the "Federal Funds
Effective Rate" as of the date of this Agreement; provided, if such
Federal Reserve Bank (or its successor)does not announce such rate on
any day, the "Federal Funds Effective Rate" for such day shall be the
Federal Funds Effective Rate for the last day on which such rate was
announced.
1.1.42 Financial Proiections shall have the meaning assigned to that term
in Section 6.1.8.2.
1.1.43 Fixed Charge Coverape Ratio shall mean the ratio of Cash Flow from
Operations to Fixed Charges.
1.1.44 Fixed Charges shall mean for any period of determination the sum of
interest expense, income taxes, scheduled principal installments on
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Indebtedness (as adjusted for prepayments), capital expenditures and
payments under capitalized leases, in each case of the Borrower and
its Subsidiaries for such period determined and consolidated in
accordance with GAAP.
1.1.45 GAAP shall mean generally accepted accounting principles as are in
effect in the United States from time to time, subject to the
provisions of Section 1.3, and applied on a consistent basis both as
to classification of items and amounts.
1.1.46 Guarantor shall mean each of the parties to this Agreement which is
designated as a "Guarantor" on the signature page hereof and each
other Person which joins this Agreement as a Guarantor after the date
hereof pursuant to Section 11.17.
1.1.47 Guarantor Joinder shall mean a joinder by a Person as a Guarantor
under this Agreement, the Guaranty Agreement and the other Loan
Documents in the form of Exhibit 1 . l(G)(1).
1.1.48 Guarantv of any Person shall mean any obligation of such Person
guaranteeing or in effect guaranteeing any liability or obligation of
any other Person in any manner, whether directly or indirectly,
including any agreement to indemnify or hold harmless any other
Person, any performance bond or other suretyship arrangement and any
other form of assurance against loss, except endorsement of negotiable
or other instruments for deposit or collection in the ordinary course
of business.
1.1.49 Guarantv APreement shall mean the Guaranty Agreement executed and
delivered by each of the Guarantors to the Agent for the benefit of
the Banks.
1.1.50 Historical Statements shall have the meaning assigned to that term
in Section 6.1.8.1.
1.1.51 Indebtedness shall mean, as to any Person at any time, any and all
indebtedness, obligations or liabilities (whether matured or
unmatured, liquidated or unliquidated, direct or indirect, absolute or
contingent, or joint or several)of such Person for or in respect of:
(i)borrowed money, (ii)amounts raised under or liabilities in respect
of any note purchase or acceptance credit facility, (iii)reimbursement
obligations (contingent or otherwise)under any letter of credit,
currency swap agreement, interest rate swap, cap, collar or floor
agreement or other interest rate management device, (iv)any other
transaction (including forward sale or purchase agreements,
capitalized leases and conditional sales agreements)having the
commercial effect of a borrowing of money entered iuto by such Person
to finance its operations or capital requirements (but not including
trade payables and accrued expenses incurred in the ordinary course of
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business which are not represented by a promissory note or other
evidence of indebtedness and which are not more than thirty (30)days
past due), or (v)any Guaranty of Indebtedness for borrowed money.
1.1.52 Indemnitv shall mean the Environmental Indemnity Agreement among the
Banks, the Agent and the Loan Parties relating to possible
environmental liabilities associated with any of the Property.
1.1.53 Ineligible Securitv shall mean any security which may not be
underwritten or dealt in by member banks of the Federal Reserve System
under Section 16 of the Banking Act of 1933 (12 U. S. C. Section 24,
Seventh), as amended.
1.1.54 Insolvencv Proceeding shall mean, with respect to any Person, (a)a
case, action or proceeding with respect to such Person (i)before any
court or any other Official Body under any bankruptcy, insolvency,
reorganization or other similar Law now or hereafter in effect, or
(ii)for the appointment of a receiver, liquidator, assignee,
custodian, trustee, sequestrator, conservator (or similar official)of
any Loan Party or otherwise relating to the liquidation, dissolution,
winding-up or relief of such Person, or (b)any general assignment for
the benefit of creditors, composition, marshaling of assets for
creditors, or other, similar arrangement in respect of such Person's
creditors generally or any substantial portion of its creditors;
undertaken under any Law.
1.1.55 Interest Period shall mean a Euro-Rate Interest Period.
1.1.56 Interim Statements shall have the meaning assigned to that term in
Section 6.1.8.1.
1.1.57 Internal Revenue Code shall mean the Internal Revenue Code of 1986,
as the same may be amended or supplemented fkom time to time, and any
successor statute of similar import, and the rules and regulations
thereunder, as from time to time in effect.
1.1.58 Labor Contracts shall mean all employment agreements, employment
contracts, collective bargaining agreements and other agreements among
any Loan Party or Subsidiary of a Loan Party and its employees.
1.1.59 Law shall mean any law (including common law), constitution,
statute, treaty, regulation, rule, ordinance, opinion, release,
ruling, order, injunction, writ, decree, bond, judgment, authorization
or approval, lien or award of or settlement agreement with any
Official Body.
1.1.60 Lien shall mean any mortgage, deed of trust, pledge, lien, security
interest, zge or other encumbrance or security mangement of any name
whatsoever, whether voluntarily or involuntarily given, including any
conditional sale or title retention arrangement, and any assignment,
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deposit arrangement or lease intended as, or having the effect of,
security and any filed financing statement or other notice of any of
the foregoing (whether or not a lien or other encumbrance is created
or exists at the time of the filing).
1.1.61 Life Insurance Collateral shall mean the property of the Xxxxxx X.
Xxxxxxxxx in which security interests are to be granted under the Life
Insurance Assignment.
1.1.62 Life Insurance Assignment shall mean the Collateral Assignment of
Life Insurance given by Xxxxxx X. Xxxxxxxxx to Agent for the benefit
of Banks.
1.1.63 LLC Interests shall have the meaning given to such term in Section
6.1.2.
1.164 Loan Documents shall mean this Agreement, the Agent's Letter, the
Guaranty Agreement, the Indemnity, the Mortgage, the Notes, the Life
Insurance Assignment, the Security Agreement, and any other
instruments, certificates or documents delivered or contemplated to be
delivered hereunder or thereunder or in connection herewith or
therewith, as the same may be supplemented or amended from time to
time in accordance herewith or therewith, and Loan Document shall mean
any of the Loan Documents.
1.1.65 Loan Parties shall mean the Borrower and the Guarantors.
1.1.66 Loan Request shall mean a Loan Request.
1.1.67 Loans shall mean collectively and m shall mean separately all
Revolving Credit Loans and the Term Loans or any Revolving Credit Loan
or Term Loan.
1.1.68 Lonp Term Debt shall mean any debt whose maturity date is greater
than twelve (12)months.
1.1.69 Mandatory Prepayment Date shall have the meaning assigned to that
term in Section 5.6-l.
1.1.70 Mandatory Prepavment of Excess Cash Flow shall have the meaning
assigned to that term in Section 5.6.1.
1.1.71 Material Adverse Change shall mean any set of circumstances or
events which (a)has or could reasonably be expected to have any
material adverse effect whatsoever upon the validity or enforceability
of this Agreement or any other Loan Document, (b)is or could
reasonably be expected to be material and adverse to the business,
properties, assets, financial condition, results of operations or
prospects of the Loan Parties taken as a whole, (c)impairs materially
or could reasonably be expected to
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impair materially the ability of the Loan Parties taken as a whole to
duly and punctually pay or perform its Indebtedness, or (d)impairs
materially or could reasonably be expected to impair materiaily the
ability of the Agent or any of the Banks, to the extent permitted, to
enforce their legal remedies pursuant to this Agreement or any other
Loan Document.
1.1.72 Month, with respect to a Euro-Rate Interest Period, shall mean the
interval between the days in consecutive calendar months numerically
corresponding to the first day of such Interest Period. If any
Euro-Rate Interest Period begins on a day of a calendar month for
which there is no numerically corresponding day in the month in which
such Interest Period is to end, the final month of such Interest
Period shall be deemed to end on the last Business Day of such final
month.
1.1.73 Moody's shall mean Xxxxx'x Investor Service, Inc. and its
successors.
1.1.74 Mortgage shall mean the Mortgage with respect to the Real Property
executed and delivered by Borrower to the Agent for the benefit of the
Banks, as may be amended f? om time to time.
1.1.75 Multiemplover Plan shall mean any employee benefit plan which is a
"multiemployer plan" within the meaning of Section 4001(a)(3)of ERISA
and to which the Borrower or any member of the ERISA Group is then
making or accruing an obligation to make contributions or, within the
preceding five Plan years, has made or had an obligation to make such
contributions.
1.1.76 Multiple Employer Plan shall mean a Plan which has two or more
contributing sponsors (including the Borrower or any member of the
ERISA Group)at least two of whom are not under common control, as such
a plan is described in Sections 4063 and 4064 of ERISA.
1.1.77 Notes shall mean the Revolving Credit Notes and the Term Notes, if
any.
1.1.78 Notices shall have the meaning assigned to that term in Section
11.6.
1.1.79 Oblipation shall mean any obligation or liability of any of the Loan
Parties to the Agent or any of the Banks, howsoever created, arising
or evidenced, whether direct or indirect, absolute or contingent, now
or hereafter existing, or due or to become due, under or in connection
with this Agreement, Notes or any other Loan Document.
1.1.80 Official Body shall mean any national, federal, state, local or
other government or political subdivision or any agency, authority,
bureau, central bank, commission, department or instrumentality of
either, or any court, tribunal, grand jury or arbitrator, in each case
whether foreign or domestic.
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1.1.81 Partnership Interests shall have the meaning given to such term in
Section 6.1.2.
1.1.82 PBGC shall mean the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA or any successor.
1.1.83 Permitted Investments shall mean:
1.1.83.1 direct obligations of the United States of America or any
agency or instrumentality thereof or obligations backed by the
full faith and credit of the United States of America maturing in
twelve (12)months or less from the date of acquisition;
1.1.83.2 commercial paper maturing in 180_days or less rated not lower
than A-l, by Standard &Poor's or P-l by Moody's on the date of
acquisition; and
1.1.83.3 demand deposits, time deposits or certificates of deposit
maturing within one year in commercial banks whose obligations
are rated A-l, A or the equivalent or better by Standard &Poor's
on the date of acquisition.
1.1.84 Permitted Liens shall mean:
1.1.84.1 Liens for taxes, assessments, or similar charges, incurred in
the ordinary course of business and which are not yet due and
payable;
1.1.84.2 Agricultural Liens in an amount less than $50,000 (in the
aggregate)and which are released of record within 30 days after
the date of such filing;
1.1.84.3 Pledges or deposits made in the ordinary course of business
to secure payment of workmen's compensation, or to participate in
any fund in connection with workmen's compensation, unemployment
insurance, old-age pensions or other social security programs;
1.1.84.4 Liens of mechanics, materialmen, warehousemen, carriers, or
other like Liens, securing obligations incurred in the ordinary
course of business that are not yet due and payable and Liens of
landlords securing obligations to pay lease payments that are not
yet due and payable or in default;
1.1.84.5 Good-faith pledges or deposits made in the ordinary course of
business to secure performance of bids, tenders, contracts (other
than for the repayment of borrowed money)or leases, not in excess
of the aggregate amount due thereunder, or to secure statutory
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obligations, or surety, appeal, indemnity, performance or other
similar bonds required in the ordinary course of business;
1.1.84.6 Encumbrances consisting of zoning restrictions, easements or
other restrictions on the use of real property, none of which
materially impairs the use of such property or the value thereof,
and none of which is violated in any material respect by existing
or proposed structures or land use;
1.1.84.7 Liens, security interests and mortgages in favor of the Agent
for the benefit of the Banks;
1.1.84.8 Liens by a bank on deposit accounts of any Loan Party or any
Subsidiary of a Loan Party at such bank that arise by operation
of law, and that are otherwise in compliance with the terms of
this Agreement;
1.1.84.9 Any Lien existing on the date of this Agreement and described
on Schedule 1.1(P), provided that the principal amount secured
thereby is not hereafter increased, and no additional assets
become subject to such Lien; and
1.1.84.10 The following, (A)if the validity or amount thereof is being
contested in good faith by appropriate and lawful proceedings
diligently conducted so long as levy and execution thereon have
been stayed and continue to be stayed or (B)if a final judgment
is entered and such judgment is discharged within thirty (30)days
of entry, and in either case they do not affect the Collateral
or, in the aggregate, materially impair the ability of any Loan
Party to perform its Obligations hereunder or under the other
Loan Documents:
1.1.84.10.1 Claims or Liens for taxes, assessments or charges due
and payable and subject to interest or penalty, provided
that the applicable Loan Party maintains such reserves or
other appropriate provisions as shall be required by GASP
and pays all such taxes, assessments or charges forthwith
upon the commencement of proceedings to foreclose any such
Lien;
1.1.84.10.2 Claims, Liens or encumbrances upon, and defects of
title to, real or personal property other than the
Collateral, including any attachment of personal or real
property or other legal process prior to adjudication of a
dispute on the merits;
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1.1.84.10.3 Claims or Liens of mechanics, materialmen,
warehousemen, carriers, or OthtT statutory nonconsensual
Liens; or
1.1.84.10.4 Liens resulting from final judgments or orders
described in Section 9.1.6.
1.1.85 Person shall mean any individual, corporation, partnership, limited
liability company, association, joint-stock company, trust,
unincorporated organization, joint venture, government or political
subdivision or agency thereof, or any other entity.
1.1.86 Plan shall mean at any time an employee pension benefit plan
(including x .Xxxxx Employer Plan, but not a Multiemployer Plan)which
is covered by. Title IV of ERISA or is subject to the minimum funding
standards under Section 412 of the Internal Revenue Code and either
(i)is maintained by any member of the ERISA Group for employees of any
member of the ERISA Group or (ii)has at any time within the preceding
five years been maintained by any entity which was at such time a
member of the ERISA Group for employees of any entity which was at
such time a member of the ERISA Group.
1.1.87 PNC Bank shall mean PNC Bank, National Association, its successors
and assigns.
1.1.88 Potential Default shall mean any event or condition which with
notice, passage of time or a determination by the Agent or the
Required Banks, or any combination of the foregoing, would constitute
an Event of Default.
1.1.89 Principal Offtce shall mean the main banking office of the Agent in
Cincinnati, Ohio.
1.1.90 Prior Securitv Interest shall mean a valid and enforceable perfected
firstpriority security interest under the Uniform Commercial Code in
the UCC Collateral which is subject only to Liens for taxes not yet
due and payable to the extent such prospective tax payments are given
priority by statute.
1.1.91 Prohibited Transaction shall mean any prohibited transaction as
defined in Section 4975 of the Internal Revenue Code or Section 406 of
ERISA for which neither an individual nor a class exemption has been
issued by the United States Department of Labor.
1.1.92 Property shall mean all real property, both owned and leased, of any
Loan Party or Subsidiary of a Loan Party.
1.1.93 Purchasing Bank shall mean a Bank that becomes a party to this
Agreement by executing an Assignment and Assumption Agreement.
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1.1.94 Ratable Share shall mean the proportion that a Bank's Commitment
bears to the Commitments of all of the Banks.
1.1.95 Real Property shall mean the real estate owned by Borrower and
located in Darke County, Ohio, which shall be encumbered by the
Mortgage.
1.1.96 Regulated Substances shall mean, without limitation, any substance,
material or waste, regardless of its form or nature, defined under
Environmental Laws as a "hazardous substance," "pollutant,"
"pollution," "contaminant," "hazardous or toxic substance," "extremely
hazardous substance, " "toxic chemical, " "toxic substance," "toxic
waste," "hazardous waste, " "special handling waste," "industrial
waste," "residual waste," "solid waste," "municipal waste," "mixed
waste," "infectious waste," "chemotherapeutic waste, " "medical
waste," or "regulated substance" or any other material, substance or
waste, regardless of its form or nature, which otherwise is regulated
by Environmental Laws.
1.1.97 Regulation U shall mean Regulation U, T, G or X as promulgated by
the Board of Governors of the Federal Reserve System, as amended from
time to time.
1.1.98 Renewal Fee shall have the meaning set forth in Section 10.15.
1.1.99 Reportable Event shall mean a reportable event described in Section
4043 of ERlSA and regulations thereunder with respect to a Plan or
Multiemployer Plan
l.l.lOO Required Banks shall mean:
1.1.100.1 if there are no Loans, Required Banks shall mean Banks whose
Commitments aggregate at least 66%of the Commitments of all of
the Banks, or
1.1.100.2 if there are Loans, Required Banks shall mean:
1.1.100.2.1 prior to a termination of the Commitments hereunder
pursuant to Section 9.2.1 or 9.2.2, any Bank or group of
Banks if the sum of the Loans of such Banks then outstanding
aggregates at least 66%of the total principal amount of all
of the Loans then outstanding.
1.1.100.2.2 After a termination of the Commitments hereunder
pursuant to Section 9.2.1 or 9.2.2, any Bank or group of
Banks if the sum of the Loans of such Banks then outstanding
aggregates at least _%of the total principal amount of all
of the Loans then outstanding.
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x.x.xXx Required Environmental Notices shall mean all notices, reports,
plans, forms or other filings which pursuant to Environmental Laws,
Required Environmental Permits or at the request or direction of an
Official Body either must be submitted to an Official Body or which
otherwise must be maintained.
l.l.lO Required Environmental Permits shall mean all permits, licenses,
bonds, consents, programs, approvals or authorizations required under
Environmental Laws to own, occupy or maintain the Property or which
otherwise are required for the operations and business activities of
the Borrower or Guarantors.
1.1.103 Required Share shall have the meaning assigned to such term in
Section 5.11.
1.1.104 Revolving Credit Commitment shall mean, as to any Bank at any time,
the amount initially set forth opposite its name on Schedule 1.1(B)in
the colUmn labeled "Amount of Commitment for Revolving Credit Loans,"
and thereafter on Schedule I to the most recent Assignment and
Assumption Agreement, and Revolvinp Credit Commitments shall mean the
aggregate Revolving Credit Commitments of all of the Banks.
1.1.105 Revolving Credit Loans shall mean collectively and Revolvinp Credit
Loan shall mean Separately all Revolving Credit Loans or any Revolving
Credit Loan made by the Banks or one of the Banks to the Borrower
pursuant to Section 2.1.
1.1.106 Revolving Credit Notes shall mean any Revolving Credit Note of the
Borrower issued by the Borrower at the request of a Bank pursuant to
Section 5.10 evidencing the Revolving Credit Loans to such Bank,
together with all amendments, extensions, renewals, replacements,
refinancings or retidings thereof in whole-or in part.
1.1.107 Revolving Facility Usage shall mean at any time the sum of the
Revolving Credit Loans outstanding.
1.l.O8 SEC shall mean the Securities and Exchange Commission or any
governmental agencies substituted therefor.
1.1.109 Section 20 Subsidiary shall mean the Subsidiary of the bank holding
company controlling any Bank, which Subsidiary has been granted
authority by the Federal Reserve Board to underwrite and deal in
certain Ineligible Securities.
1.l.l1O Securitv Apreement shall mean the Security Agreement executed and
delivered by each of the Loan Parties to the Agent for the benefit of
the Banks.
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1.1.111 Settlement Date shall mean the day of each week that Borrower makes
a draw or a payment (if such day is a Business Day and if not, the
next succeeding Business Day)and any other Business Day on which the
Agent elects to effect settlement pursuant to Section 5.11.
1.1.112 Shares shall have the meaning assigned to that term in Section
6.1.2.
1.1.113 Standard &Poor's shall mean Standard &Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies, Inc., and its successors.
1.l.114 Subsidiary of any Person at any time shall mean (i)any corporation
or trust of which 50%or more (by number of shares or number of
votes)of the outstanding capital stock or shares of beneficial
interest normally entitled to vote for the election of one or more
directors or trustees (regardless of any contingency which does or may
suspend or dilute the voting rights)is at such time owned directly or
indirectly by such Person or one or more of such Person's
Subsidiaries, (ii)any partnership of which such Person is a general
partner or of which 50%or more of the partnership interests is at the
time directly or indirectly owned by such Person or one or more of
such Person's Subsidiaries, (iii)any limited liability company of
which such Person is a member or of which 50%or more of the limited
liability company interests is at the time directly or indirectly
owned by such Person or one or more of such Person's Subsidiaries or
(iv)any corporation, trust, partnership, limited liability company or
other entity which is controlled or capable of being controlled by
such Person or one or more of such Person's Subsidiaries.
l.lll Subsidiarv Shares shall have the meaning assigned to that term in
Section 6.1.2.
1.1.116 TangibIe Net Worth shall mean the total of the paid in capital,
capital contributions, surplus, general contingency reserves and
retained earnings (deficit)of Borrower and its Subsidiaries as
determined on a consolidated basis in accordance with generally
accepted accounting principles, minus the following items (without
duplication of deductions), if any, appearing on the consolidated
balance sheet of Borrower:
(i) all deferred charges (less amortization, unamortized debt
discount and expense and corporate organization expenses;
(ii) the book amount of all assets which would be treated as
intangibles under generally accepted accounting principles,
including, without limitation, such items as goodwill, trademark
applications, trade names, service marks, brand names,
copyrights, patents, patent applications and licenses, and rights
with respect to the foregoing;
(iii)the amount by which aggregate inventories or aggregate
securities appearing on the asset side of s such consolidated
balance sheet
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exceed the lower or cost or market value (at the date of such
balance sheet)thereof;
(iv) any write-up in the book amount of any asset resulting from a
revaluation thereof from the book amount entered upon acquisition
of such asset; and
(v) the account identified as "other" on Borrower's financial
statements which represents the debt owing from Xxxxxxxxx
Partners, L. P. to Borrower.
1.1.117 Term Loan A shall have the meaning given to such term in Section
3.1.1.
1.1.118 Term Loan B shall have the meaning given to such term in Section
3.1.2.
1.l.119 Term Loan C shall have the meaning given to such term in Section
3.1.3.
l.l.l2O Term Loans shall mean collectively Term Loan A, Term Loan B and
Term Loan C.
1.1.121 Term Loan A Interest Rate shall mean the interest rate set forth in
Section 4.1.2.1.
1.1.122 Term Loan B Interest Rate shall mean the interest rate set forth in
Section 4.1.2.2.
1.1.123 Term Loan C Interest Rate shall mean the interest rate set forth in
Section 4.1.2.3.
1.1.124 Term Loan Commitment shall mean, as to any Bank at any time, the
amount initially set forth opposite its name on Schedule 1.1(B)in the
column labeled "Amount of Commitment for Term Loans," and thereafter
on Schedule I to the most recent Assignment and Assumption Agreement,
and Term Loan Commitments shall mean the aggregate Term Loan
Commitments of all of the Banks.
1.1.125 Term Notes shall mean collectively and Term Note shall mean
separately all of the Term Notes of the Borrower issued by the
Borrower at the request of a Bank pursuant to Section 5.10 evidencing
the Term Loans together with all amendments, extensions, renewals,
replacements, refinancings or refunds thereof in whole or in part.
1.1.126 Transferor Bank shall mean the selling Bank pursuant to an
Assignment and Assumption Agreement.
1.1.127 UCC Collateral shall mean the property of the Loan Parties in which
security interests are to be granted under the Security Agreement.
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1.1.128 Uniform Commercial Code shall mean the Uniform Commercial Code as
in effect in each applicable jurisdiction (the "Uniform Commercial
Code")or other applicable Law entitled to all the rights, benefits and
priorities provided by the Uniform Commercial Code or such Law.
1.2 Construction. Unless the context of this Agreement otherwise clearly
requires, the following rules of construction shall apply to this Agreement
and each of the other Loan Documents:
1.2.1 Number; Inclusion. References to the plural include the singular, the
plural, the part and the whole; "or" has the inclusive meaning
represented by the phrase "and/or," and "including" has the meaning
represented by the phrase "including without limitation";
1.2.2 Determination. References to "determination" of or by the Agent or
the Banks shall be deemed to include good-faith estimates by the Agent
or the Banks (in the case of quantitative determinations)and
good-faith beliefs by the Agent or the Banks (in the case of
qualitative determinations)and such determination shall be conclusive
absent manifest error;
1.2.3 Agent's Discretion and Consent. Whenever the Agent or the Banks are
granted the right herein to act in its or their sole discretion or to
grant or withhold consent such right shall be exercised in good faith,
1.2.4 Documents Taken as a Whole. The words "hereof," "herein,"
"hereunder," "hereto" and similar terms in this Agreement or any other
Loan Document refer to this Agreement or such other Loan Document as a
whole and not to any particular provision of this Agreement or such
other Loan Document;
1.2.5 Headings. The section and other headings contained in this Agreement
or such other Loan Document and the Table of Contents (if any),
preceding this Agreement or such other Loan Document are for reference
purposes only and shall not control or affect the construction of this
Agreement or such other Loan Document or the interpretation thereof in
any respect;
1.2.6 Implied References to this Apreement. Article, section, subsection,
clause, schedule and exhibit references are to this Agreement or other
Loan Document, as the case may be, unless otherwise specified;
1.2.7 Persons. Reference to any Person includes such Person's successors
and assigns but, if applicable, only if such successors and assigns
are permitted by this Agreement or such other Loan Document, as the
case may be, and reference to a Person in a particular capacity
excludes such Person in any other capacity;
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1.2.8 Modifications to Documents. Reference to any agreement (including
this Agreement and any other Loan Document together with the schedules
and exhibits hereto .or thereto), document or instrument means such
agreement, document or instrument as amended, modified, replaced,
substituted for, superseded or restated;
1.2.9 From, To and Through. Relative to the determination of any period of
time, "from" means "from and including," "to" means "to but
excluding," and "through" means "through and including"; and
1.2.10 Shall: Will. References to "shall" and "will" are intended to have
the same meaning.
1.3 Accounting Principles. Except as otherwise provided in this Agreement, all
computations and determinations as to accounting or financial matters and
all financial statements to be delivered pursuant to this Agreement shall
be made and prepared in accordance with GAAP (including principles of
consolidation where appropriate), and all accounting or financial terms
shall have the meanings ascribed to such terms by GAAP; provided, however,
that all accounting terms used in Section 8.2 (and all defined terms used
in the definition of any accounting term used in Section 8.2 shall have the
meaning given to such terms (and defined terms)under GASP as in effect on
the date hereof applied on a basis consistent with those used in preparing
the Annual Statements referred to in Section 6.1.8.1. In the event of any
change. after the date hereof in GAAP, and if such change would result in
the inability to determine compliance with the financial covenants set
forth in Section 8.2 based upon the Borrower's regularly prepared financial
statements by reason of the preceding sentence, then the parties hereto
agree to endeavor, in good faith, to agree upon an amendment to this
Agreement that would adjust such financial covenants in a manner that would
not affect the substance thereof, but would allow compliance therewith to
be determined in accordance with the Borrower's financial statements at
that time.
2. REVOLVING CREDIT FACILITIES.
2.1 Revolving Credit Commitments.
2.1.1 Revolving Credit Loans. Subject to the terms and conditions
hereof and relying upon the representations and warranties herein
set forth, each Bank severally agrees to make Revolving Credit
Loans to the Borrower at any time or from time to time on or
after the date hereof to the Expiration Date provided that after
giving effect to each such Loan the aggregate amount of Loans
from such Bank shall not exceed the lesser of (i)such Bank's
Revolving Credit Commitment, or (ii)the Borrowing Base. Within
such limits of time and amount and subject to the other
provisions of this Agreement, the Borrower may borrow, repay and
reborrow pursuant to this Section 2.1.
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2.2 Nature of Banks'Oblbations with Respect to Revolvine Credit Loans.
Each Bank shall be obligated to participate in each request for
Revolving Credit Loans pursuant to Section 2.3 in accordance with its
Ratable Share. The aggregate Dollar Equivalent amount of each Bank's
Revolving Credit Loans outstanding hereunder to the Borrower at any
time shall never exceed its Revolving Credit Commitment. The
obligations of each Bank hereunder are several. The failure of any
Bank to perform its obligations hereunder shall not affect the
Obligations of the Borrower to any other party nor shall any other
party be liable for the failure of such Bank to perform its
obligations hereunder. The Banks shall have no obligation to make
Revolving Credit Loans hereunder on or after the Expiration Date.
2.3 Revolvinp Credit Loan Requests.
2.3.1 Revolving Credit Loan Requests. Except as otherwise provided
herein, the Borrower may from time to time prior to the
Expiration Date request the Banks to make Revolving Credit Loans
by delivering to the Agent, not later than 10: 00 a. m.,
Cincinnati tune, one (1)Business Day prior to either the proposed
Borrowing Date of a duly completed request therefor substantially
in the form of Exhibit 2.3 or a request by telephone immediately
confirmed in writing by letter, facsimile or telex in such form
(each, a "Loan Request"), it being understood that the Agent may
rely on the authority of any individual making such a telephonic
request without the necessity of receipt of such written
confirmation. Each Loan Request shall be accompanied by a duly
completed Borrowing Base Certificate substantially, shall be
irrevocable and shall specify (i)the proposed Borrowing Date; and
(ii)the aggregate amount of the proposed Loans, which shall be
not more than the Maximum Amount.
2.4 Making Revolvinp Credit The Loans: RevolvinP Agent shall, Credit
Notes. promptly after receipt by it of a Loan Request pursuant to
Section 2.3, notify the Banks of its receipt of such Loan Request
specifying: (i)the proposed Borrowing Date and the time and method of
disbursement of the Revolving Credit Loans requested thereby; (ii)the
amount and type of each such Revolving Credit Loan; and (iii)the
apportionment among the Banks of such Revolving Credit Loans as
determined by the Agent in accordance with Section 2.2. Each Bank
shall remit the principal amount of each Revolving Credit Loan to the
Agent such that the Agent is able to, and the Agent shah, to the
extent the Banks have made funds available to it for such purpose and
subject to Section 7.2, fund such Revolving Credit Loans to the
Borrower in U. S. Dollars and immediately available funds at the
Principal Office prior to 2: 00 p. m., Cincinnati, Ohio time, on the
applicable Borrowing Date, provided that if any Bank fails to remit
such funds to the Agent in a timely manner, the Agent may elect in its
sole discretion to fund with its own funds the Revolving Credit Loans
of such Bank on such Borrowing Date, and such Bank shall be subject to
the repayment obligation in Section 10.16.
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2.5 RevolvinP Credit Notes. The Obligation of the Borrower to repay the
aggregate unpaid principal amount of the Revolving Credit Loans made
to it by each Bank, together with interest thereon, shall be evidenced
by a Revolving Credit Note dated the Closing Date payable to the order
of such Bank in a face amount equal to the Revolving Credit Commitment
of such Bank.
2.6 Use of Proceeds. The proceeds of the Revolving Credit Loans shah be
used for working capital purposes and in accordance with Section
8.1.10.
2.7 Extension bv Banks of the Expiration Date. Upon or promptly after
delivery by the Borrower of the annual financial statements to be
provided under Section 8.3.3 for the fiscal year ending December 3
1,200O or any subsequent fiscal year, the Borrower may request a
one-year extension of the Expiration Date by written notice to the
Banks, and the Banks agree to respond to the Borrower's request for an
extension by the later of sixty (60)days following receipt of the
request; provided, however, that the failure of any Bank to respond
within such time period shall not in any manner constitute an
agreement by such Bank to extend the Expiration Date. If all Banks
elect to extend, the Expiration Date shall be extended for a period of
one year.
3. TERM LOANS.
3.1 Term Loan Commitments. Subject to the terms and conditions hereof, and
relying upon the representations and warranties herein set forth, each
Bank severally agrees to make the term loans asset forth below to the
Borrower on the Closing Date in such principal amount as the Borrower
shall request up to, but not exceeding such Bank's Term Loan
Commitment:
3.1.1 Term Loan A. Each Bank severally agrees to make, subject to the
terms and conditions herein set forth, the Term Loan A (" Term
Loan A")to the Borrower in an amount not to exceed $3,177,806.99
in the aggregate; provided that no Default or Event of Default
exists.
3.1.2 Term Loan B. Each Bank severahy agrees to make, subject to the
terms and conditions herein set forth, the Term Loan B (" Term
Loan B")to the Borrower in an amount not to exceed $574,604.89 in
the aggregate; provided that no Default or Event of Default
exists.
3.1.3 Term Loan C. Each Bank severally agrees to make, subject to the
terms and conditions herein set forth, the Term Loan C (" Term
Loan C")to the Borrower in an amount not to exceed $1,000,000 in
the aggregate; provided that no Default or Event of Default
exists.
3.2 Nature of Banks'Obligations with Respect to Term Loans. The
obligations of each Bank to make Term Loans to the Borrower shah be in
the proportion that such Bank's Term Loan Commitment bears to the Term
Loan Commitments of all Banks to the Borrower, but each Bank's Term
Loan to the Borrower shall never exceed its Term Loan Commitment. The
failure of any Bank to make a Term
-2l-
Loan shall not relieve any other Bank of its obligations to make a
Term Loan nor shall it impose any additional liability on any other
Bank hereunder. The Banks shall have-no obligation to make Term Loans
hereunder after the Closing Date. The Term Loan Commitments are not
revolving credit commitments, and the Borrower shall not have the
right to borrow, repay and reborrow under Section 3.1.
3.3 Use of Proceeds_The proceeds of the Term Loans shall be used for
working capital and in accordance with Section 8.1.10.
4. INTEREST RATES.
4.1 Interest Rates. The Borrower shall pay interest in respect of the
outstanding unpaid principal amount of the Loans as set forth below
applicable to the Loans. If at any 'time the designated rate
applicable to any Loan made by any Bank exceeds such Bank's highest
lawful rate, the rate of interest on such Bank's Loan shall be limited
to such Bank's highest lawful rate.
4.1.1 Revolving Credit Interest Rate. The Borrower shah pay
interest for the Revolving Credit Loan at a fluctuating rate
per annum (computed on the basis of a year of 360 days and
actual days elapsed)equal to the Base Rate plus two percent
(2%), such interest rate to change automatically from time
to time effective as of the effective date of each change in
the Base Rate.
4.1.2 Term Loan Interest Rates. The Borrower shall pay interest
for each Term Loans at the interest rates as set forth
below:
4.1.2.1 Term Loan A Rate. The Borrower shah pay interest for
Term Loan A at a fluctuating rate per annum (computed
on the basis of a year of 360 days and actual days
elapsed)equal to the Base Rate plus one percent (l%),
such interest rate to change automatically from time to
time effective as of the effective date of each change
in the Base Rate.
4.1.2.2 Term Loan B Rate. The Borrower shall pay interest
for Term Loan B at a rate per annum (computed on the
basis of a year of 360 days and actual days
elapsed)equal to the Euro-Rate plus three percent (3%).
4.1.2.3 Term Loan C Bate. The Borrower shall pay interest
for Term Loan C at a fluctuating rate per annum
(computed on the basis of a year of 360 days and actual
days elapsed)equal to the Base Rate plus two percent
(2%), such interest rate to change automatically from
time to time effective as of the effective date of each
change in the Base Rate.
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4.2 Interest After Default. To the extent permitted by Law, upon the
occurrence of an Event of Default and until such time such Event of
Default shah have .been cured or waived:
4.2.1 The Interest rate Rate. of interest for each Loan otherwise
applicable pursuant to Section 4.1, respectively, shall be
increased by 6.0%per annum; and
4.2.2 Other Obligations. Each other Obligation hereunder if not paid
when due shall bear interest at a rate per annum equal to the sum
of the rate of interest applicable under the Revolving Credit
Base Rate plus an additional 6%per annum from the time such
Obligation becomes due and payable and until it is paid in full.
The
4.2.3 Acknowledement. Borrower acknowledges that the increase in rates
referred to in this Section 4.2 reflects, among other things, the
fact that such Loans or other amounts have become a substantially
greater risk given their default status and that the Banks are
entitled to additional compensation for such risk; and all such
interest shah be payable by Borrower upon demand by Agent.
4.3 Euro-Rate Unascertainable: Illegality; Increased Costs: Deposits Not
Available.
4.3.1 Unascertainable. If on any date on which a Euro-Rate would
otherwise be determined with respect to Term Loan B, the Agent
shall have determined that:
4.3.1.1 adequate and reasonable means do not exist for ascertaining
such Euro-Rate, or
4.3.1.2 a contingency has occurred which materially and adversely
affects the London interbank eurodollar market relating to the
Euro-Rate,
the Agent shall have the rights specified in Section 4.4.3.
4.3.2 Illegality; Increased Costs: Deposits Not Available. If at any
time any Bank shall have determined that:
4.3.2.1 the making, maintenance or funding of any Loan to which a
Euro-Rate applies has been made impracticable or unlawful by
compliance by such Bank in good faith with any Law or any
interpretation or application thereof by any Official Body
or with any request or directive of any such Official Body
(whether or not having the force of Law), or
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4.3.2.2 such Euro-Rate will not adequately and fairly reflect the
cost to such Bank of the establishment or maintenance of any
such Loan, or
4.3.2.3 after making all reasonable efforts, deposits of the
relevant amount in Dollars for the relevant Interest Period
for a Loan, or to banks generally, to which a Euro-Rate
applies, respectively, are not available to such Bank with
respect to such Loan, or to banks generally, in the London
interbank eurodollar market,
then the Agent shall have the rights specified in Section 4.4.3.
4.3.3 Agent's and Bank's Riphts. In the case of any event specified in
Section 4.4.1 above, the Agent shall promptly so notify the Banks
and the Borrower thereof, and in the case of an event specified
in Section 4.4.2 above, such Bank shall promptly so notify the
Agent and endorse a certificate to such notice as to the specific
circumstances of such notice, and the Agent shall promptly send
copies of such notice and certificate to the other Banks and the
Borrower. Upon such notice, the Borrower shall, subject to the
Borrower's indemnification Obligations under Section 5.7.2, as to
any Loan of the Bank to which a Euro-Rate Option applies, on the
date specified in such notice either (i)as applicable, convert
such Loan to the Base Rate Gption otherwise available with
respect to such Loan or (ii)prepay such Loan in accordance with
Section 5.5. Absent due notice from the Borrower of conversion or
prepayment, such Loan shall automatically be converted to the
Base Rate Option otherwise available with respect to such Loan
upon such specified date.
5. PAYMENTS.
5.1 Payments. All payments and prepayments to be made in respect of
principal, interest or other fees or amounts due from the Borrower
hereunder shall be payable prior to 11: OO a. m., Cincinnati, Ohio
time, on the date when due without presentment, demand, protest or
notice of any kind, all of which are hereby expressly waived by the
Borrower, and without set-off, counterclaim or other deduction of any
nature, and an action therefor shall immediately accrue. Such payments
shall be made to the Agent at the Principal Office for the ratable
accounts of the Banks with respect to the Revolving Credit Loans or
Term Loans in U. S. Dollars and in immediately available funds, and
the Agent shall promptly distribute such amounts to the Banks in
immediately available funds, provided that in the event payments are
received by 11: OO a. m., Cincinnati, Ohio time, by the Agent with
respect to the Loans and such payments are not distributed to the
Banks on the same day received by the Agent, the Agent shall pay the
Banks the Federal Funds Effective Rate in the case of Loans or other
amounts due in Dollars, with respect to the amount of such payments
for each day held by the Agent and not distributed to the Banks. The
Agent's and each Bank's statement of
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account, ledger or other relevant record shall, in the absence of
manifest error, be conclusive as the statement of the amount of
principal of and interest on the Loans and other amounts owing under
this Agreement (including the Equivalent Amounts of the applicable
currencies where such computations are required )and shall be deemed
an "account stated."
5.2 Pro Rata Treatment of Banks. Each borrowing of Revolving Credit Loans
or Term Loans shall be allocated to each Bank according to its Ratable
Share, and each payment or prepayment by the Borrower with respect to
principal or interest on the Revolving Credit Loans or Term Loans or
other fees or amounts due from the Borrower hereunder to the Banks
with respect to the Revolving Credit Loans or Term Loans, shall
(except as provided in Section 4.3.3 in the case of an event specified
in Section 4.3, 5.5.2 or 5.7)be made in proportion to the applicable
Revolving Credit Loans or Term Loans outstanding from each Bank and,
if no such Loans are then outstanding, in proportion to the Ratable
Share of each Bank.
5.3 Interest Payment Dates. Interest on all Loans shall be due and payable
in arrears on the first Business Day of each month after the date
hereof and on the Expiration Date or upon acceleration of the Loan.
Interest on mandatory prepayments of principal under Section 5.6 shall
be due on the date such mandatory prepayment is due. Interest on the
principal amount of each Loan or other monetary Obligation shall be
due and on demand after such principal amount or other monetary
Obligation becomes due and payable (whether on the stated maturity
date, upon acceleration or otherwise).
5.4 Principal Payment Dates Principal on the Term Loans shall be due and
payable on the first Business Day of each month after the date hereof
and on the Expiration Date or upon acceleration of the Loan. Borrower
shall make monthly principal payment amounts on the Term Loans as
follows:
5.4.1 Term Loan A. Borrower shall make monthly principal payments to
Agent in the amount of $11,000.
5.4.2 Term Loan B. Borrower shall make monthly principal payments to
Agent in the amount of $27,362.00.
5.4.3 Term Loan C. Beginning on November 1,2000, Borrower shall make
monthly principal payments to Agent in the amount of $12,000.
5.5 Voluntary Prepayments.
5.5.1 Right to Prepay. The Borrower shall have the right at its option
from time to time to prepay the Loans in whole or part without
premium or penalty (except as provided in Section 5.5.2 below or
in Section 5.7):
5.5.1.1 at any time with respect to any Loan to which the Base
Rate applies,
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5.5.1.2 on the last day of the applicable Interest Period with
respect to Loans to which a Euro-Rate applies,
5.5.1.3 on the date specified in a notice by any Bank pursuant to
Section 4.3 with respect to any Loan to which a Euro-Rate
applies.
Whenever the Borrower desires to prepay any part of the Loans, it
shall provide a prepayment notice to the Agent by 1: 00 p. m. at
least one (1) Business Day prior to the date of prepayment of the
Revolving Credit Loans or Term Loans, setting forth the following
information:
(i) the date, which shall be a Business Day, on which the
proposed prepayment is to be made;
(ii) a statement indicating the application of the prepayment
between Revolving Credit Loans and Term Loans; and
(iii) the total principal amount of such prepayment.
All prepayment notices shall be irrevocable. The principal
amount of the Loans for which a prepayment notice is given,
together with interest on such principal amount except with
respect to Loans to which the Base Rate applies, shall be
due and payable on the date specified in such prepayment
notice as the date on which the proposed prepayment is to be
made. All Term Loan prepayments permitted pursuant to this
Section 5.5.1 shall be applied to the unpaid installments of
principal of the Term Loans in the inverse order of
scheduled maturities. Except as provided in Section 4.3.3,
if the Borrower prepays a Loan but fails to specify the
applicable Loan which the Borrower is prepaying, the
prepayment shall be applied (i)first to Revolving Credit
Loans and then to Term Loans; and (ii)after giving effect to
the allocations in clause (i)above and in the preceding
sentence, first to Loans to which the Base Rate applies,
then to Loans to which the Euro-Rate applies. Any prepayment
hereunder shall be subject to the Borrower's Obligation to
indemnify the Banks under Section 5.7.2.
5.5.2 Replacement of a Bank. In the event any Bank (i)gives notice
under Section 4.3 or Section 5.7.1, (ii)does not fund Revolving
Credit Loans because the making of such Loans would contravene
any Law applicable to such Bank, or (iii)becomes subject to the
control of an Official Body (other than normal and customary
supervision), then the Borrower shall have the right at its
option, with the consent of the Agent, which shall not be
unreasonably withheld, to prepay the Loans of such Bank in whole,
together with all interest accrued thereon, and terminate such
Bank's Commitment within ninety (90)days after (x)receipt of such
Bank's notice under Section 4.3 or 5.7.1, (y)the date such Bank
has failed to fund
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Revolving Credit Loans because the making of such Loans would
contravene Law applicable to such Bank, or (z)the date such Bank
became subject to the control of an Official Body, as applicable;
provided that the Borrower shall also pay to such Bank at the
time of such prepayment any amounts required under Section 5.7
and any accrued interest due on such amount and any related fees;
provided, however, that the Commitment and Term Loan of such Bank
shall be provided by one or more of the remaining Banks or a
replacement bank acceptable to the Agent; provided, further, the
remaining Banks shall have no obligation hereunder to increase
their Commitments. Notwithstanding the foregoing, the Agent may
only be replaced subject to the requirements of Section A*10 14
5.5.3 Chance of Lendine Offrce. Each Bank agrees that upon the
occurrence of any event giving rise to increased costs or other
special payments under Section 4.3.2 or 5.7.1 with respect to
such Bank, it will if requested by the Borrower, use reasonable
efforts (subject to overall policy considerations of such Bank)to
designate another Lending Office for any Loans affected by such
event, provided that such designation is made on such terms that
such Bank and its Lending Office suffer no economic, legal or
regulatory disadvantage, with the object of avoiding the
consequence of the event giving rise to the operation of such
Section. Nothing in this Section 5.5.3 shall affect or postpone
any of the Obligations of the Borrower or any other Loan Party or
the rights of the Agent or any Bank provided in this Agreement.
5.6 Mandatory Prepayments.
5.6.1 Excess Cash Flow. Within five (5)Business Days of delivery of
the Borrower's annual financial statements pursuant to Section
8.3.3, but in any event no later than May 15*of each year during
the term hereof (each, a "Mandatory Prepayment Date"), the
Borrower shall make a mandatory prepayment of principal on the
Term Loans equal to 25%of Excess Cash Flow for the immediately
preceding fiscal year, subject to a credit for voluntary
prepayments made pursuant to Section 5.5 during the immediately
preceding fiscal year, together with accrued interest on such
principal amount (each, a "Mandatory Prepayment of Excess Cash
Flow"). Each Mandatory Prepayment of Excess Cash Flow shall be
applied to payment in full of the principal amount of the Term
Loans by application to the unpaid installments of principal in
the inverse order of scheduled maturities. To the extent that a
Mandatory Prepayment of Excess Cash Flow exceeds the outstanding
principal amount of the Term Loans, such prepayment shall be
limited to the amount necessary to prepay the Term Loans in full.
5.6.2 Sale of Assets. Within five (5)Business Days of any sale of
assets authorized by Section 8.2.6.5, the Borrower shall make a
mandatory
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prepayment of principal on the Term Loans equal to the after-tax
proceeds of such sale (as estimated in good faith by the
Borrower), together with accrued interest on such principal
amount. All prepayments pursuant to this Section 5.6.2 shall be
applied to payment in full of the principal amount of the Term
Loans by application to the unpaid installments of principal in
the inverse order of scheduled maturities.
5.6.3 Application Among Interest Rates. All prepayments required
pursuant to this Section 5.6 shall first be applied among the
interest rates to the principal amount of the Loans subject to
the Base Rate, then to Loans subject to a Euro-Rate. In
accordance with Section 5.7.2, the Borrower shall indemnify the
Banks for any loss or expense, including loss of margin, incurred
with respect to any such prepayments applied against Loans
subject to a Euro-Rate on any day other than the last day 'of the
applicable Interest Period.
5.7 Additional Compensation in Certain Circumstances.
5.7.1 Increased Costs or Reduced Return ResultinP from Taxes,
Reserves, Capital Adequacy Requirements, Expenses, Etc. If any
Law, guideline or interpretation or any change in any Law,
guideline or interpretation or application thereof by any
Official Body charged with the interpretation or administration
thereof or compliance with any request or directive (whether or
not having the force of Law)of any central bank or other Official
Body:
5.7.1.1 subjects any Bank to any tax or changes the basis of taxation
with respect to this Agreement, the Notes, the Loans or payments
by the Borrower of principal, interest, Commitment Fees, or other
amounts due from the Borrower hereunder or under the Notes
(except for taxes on the overall net income of such Bank),
5.7.1.2 imposes, modifies or deems applicable any reserve, special
deposit or similar requirement against credits or commitments to
extend credit extended by, or assets (funded or contingent)of,
deposits with or for the account of, or other acquisitions of
funds by, any Bank or any Lending Office of any Bank, or
5.7.1.3 imposes, modifies or deems applicable any capital adequacy or
similar requirement (A)against assets (funded or contingent)of,
or letters of credit, other credits or commitments to extend
credit extended by, any Bank, or (B)otherwise applicable to the
obligations of any Bank or any Lending Office of any Bank under
this Agreement,
and the result of any of the foregoing is to increase the cost to,
reduce the income receivable by, or impose any expense (including loss
of margin)upon any Bank
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or its Lending Office with respect to this Agreement, the Notes or the
making, maintenance or funding of any part of the Loans (or, in the
case of any capital adequacy or similar requirement, to have the effect
of reducing the rate of return on any Bank's capital, taking into
consideration such Bank's customary policies with respect to capital
adequacy)by an amount which such Bank in its sole discretion deems to
be material, such Bank shall from time to time notify the Borrower and
the Agent of the amount determined in good faith (using any averaging
and attribution methods employed in good faith)by such Bank to be
necessary to compensate such Bank for such increase in cost, reduction
of income, additional expense or reduced rate of return. Such notice
shall set forth in reasonable detail the basis for such determination.
Such amount shall be due and payable by the Borrower to such Bank ten
(10)Business Days after such notice is given.
5.7.2 Indemnitv. In addition to the compensation required by Section
5.7, the Borrower shall indemnify each Bank against all
liabilities, losses or expenses (including loss of margin, any
loss or expense incurred in liquidating or employing deposits
from third parties and any loss or expense incurred in connection
with funds acquired by a Bank to fund or maintain Loans subject
to a Euro-Rate)which such Bank sustains or incurs as a
consequence of any
5.7.2.1 payment, prepayment, conversion or renewal of any Loan to
which a Euro-Rate applies on a day other than the last day
of the corresponding Interest Period (whether or not such
payment or prepayment is mandatory, voluntary or automatic
and whether or not such payment or prepayment is then due),
5.7.2.2 attempt by the Borrower to revoke (expressly, by later
inconsistent notices or otherwise)in whole or part any Loan
Requests under Section 2.3, or notice relating to
prepayments under Section 5.5, or
5.7.2.3 default by the Borrower in the performance or observance
of any covenant or condition contained in this Agreement or
any other Loan Document, including any failure of the
Borrower to pay when due (by acceleration or otherwise)any
principal of or interest on the Loans or any other amount
due hereunder.
If any Bank sustains or incurs any such loss or expense, it shall
from time to time notify the Borrower of the amount determined in
good faith by such Bank (which determination may include such
assumptions, allocations of costs and expenses and averaging or
attribution methods as such Bank shall deem reasonable)to be
necessary to indemnify such Bank for such loss or expense. Such
notice shall set forth in reasonable detail the basis for such
determination. Such amount shall be due and payable by the
Borrower to such Bank ten (10)Business Days after such notice is
given.
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5.8 Interbank Market Presumption. For all purposes of this Agreement and
each Note with respect to any aspects of the Euro-Rate, any Loan under
the Euro-Rate, each Bank and Agent shall be presumed to have obtained
rates, funding, currencies, deposits, and the like in the applicable
interbank market regardless whether it did so or not; and, each Bank's
and Agent's determination of amounts payable under, and actions
required or authorized by, Sections 4.3 and 5.7 shall be calculated,
at each Bank's and Agent's option, as though each Bank and Agent
funded its Loan under the Euro Rate through the purchase of deposits
of types and maturities corresponding to the deposits used as a
reference in accordance with the terms hereof in determining the
Euro-Rate applicable to such Loans, whether in fact that is the case.
5.9 Taxes.
5.9.1 No Deductions. All payments made by Borrower hereunder and
under each Note shall be made free and clear of and without
deduction for any present or future taxes, levies, imposts,
deductions, charges, or withholdings, and all liabilities with
respect thereto, excluding taxes imposed on the net income of any
Bank and all income and franchise taxes applicable to any Bank of
the United States (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings, and liabilities being
hereinafter referred to as "Taxes"). If Borrower shall be
required by Law to deduct any Taxes from or in respect of any sum
payable hereunder or under any Note, (i)the sum payable shall be
increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums
payable under this Section 5.9.1 each Bank receives an amount
equal to the sum it would have received had no such deductions
been made, (ii)Borrower shall make such deductions and
(iii)Borrower shall timely pay the full amount deducted to the
relevant tax authority or other authority in accordance with
applicable Law.
5.9.2 Stamp Taxes. In addition, Borrower agrees to pay any present or
future stamp or documentary taxes or any other excise or property
taxes, charges, or similar levies which arise from any payment
made hereunder or ti-om the execution, delivery, or registration
of, or otherwise with respect to, this Agreement or any Note
(hereinafter referred to as "Other Taxes").
5.9.3 Indemnification for Taxes Paid by a Bank. Borrower shall
indemnify each Bank for the full amount of Taxes or Other Taxes
(including, without limitation, any Taxes or Other Taxes imposed
by any jurisdiction on amounts payable under this Section
5.9.3)paid by any Bank and any liability (including penalties,
interest, and expenses)arising therefrom or with respect thereto,
whether or not such Taxes or Other Taxes were correctly or
legally asserted. This indemnification shall be made within 30
days from the date a Bank makes written demand therefor.
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5.9.4 Certificate. Within 30 days after date of any payment of any
Taxes by Borrower, Borrower shall furnish to each Bank, at its
address referred to herein, the original or a certified copy of a
receipt evidencing. payment thereof. If no Taxes are payable in
respect of any payment by Borrower, such Borrower shall, if so
requested by a Bank, provide a certificate of an officer of
Borrower to that effect.
5.9.5 Survival. Without prejudice to the survival of any other
agreement of Borrower hereunder, the agreements and obligations
of Borrower contained in Sections 5.9.1 through 5.9.3 shall
survive the payment in full of principal and interest hereunder
and under any instrument delivered hereunder.
5.10 Notes. Upon the request of any Bank, the Revolving Credit Loans or
Term Loans made by such Bank may be evidenced by a Revolving Credit
Note or a Term Note.
5.11 Settlement Date Procedures. Not later than 12: 00 p. m. on each
Settlement -'l Date, the Agent shall notify each Bank of its Ratable
Share of the total of the Revolving Credit Loans (each a "Required
Share"). Prior to 2: 00 p. m., Cincinnati, Ohio time, on such
Settlement Date, each Bank shall pay to the Agent the amount equal to
the difference between its Required Share and its Revolving Credit
Loans, and the Agent shall pay to each Bank its Ratable Share of all
payments made by the Borrower to the Agent with respect to the
Revolving Credit Loans. The Agent shall also effect settlement in
accordance with the foregoing sentence on the proposed Borrowing Dates
for Revolving Credit Loans and on Mandatory Prepayment Dates and may
at its option effect settlement on any other Business Day. These
settlement procedures are established solely as a matter of
administrative convenience, and nothing contained in this Section 5.11
shall relieve the Banks of their obligations to fund Revolving Credit
Loans on dates other than a Settlement Date pursuant to Section 2.1.
The Agent may at any time at its option for any reason whatsoever
require each Bank to pay immediately to the Agent such Bank's Ratable
Share of the outstanding Revolving Credit Loans and each Bank may at
any time require the Agent to pay immediately to such Bank its Ratable
Share of all payments made by the borrower to the Agent with respect
to the Revolving Credit Loans.
6. REPRESENTATIONS AND WARRANTIES.
6.1 Representations and Warranties. The Loan Parties, jointly and
severally, represent and warrant to the Agent and each of the Banks as
follows:
6.1.1 Orpanization and Qualification. Each Loan Party and each
Subsidiary of each Loan Party is a corporation, partnership or
limited liability company duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization.
Each Loan Party and each Subsidiary of each Loan Party has the
lawful power to own or lease its
-3l-
properties and to engage in the business it presently conducts or
proposes to conduct. Each Loan Party and each Subsidiary of each
Loan Party is duly licensed or qualified and in good standing in
each jurisdiction where the property owned or leased by it or the
nature of the business transacted by it or both makes such
licensing or qualification necessary.
6.1.2 Subsidiaries. Schedule 6.1.2 states the name of each of the
Borrower's Subsidiaries, its jurisdiction of incorporation, its
authorized capital stock, the issued and outstanding shares
(referred to herein as the "Subsidiary Shares")and the owners
thereof if it is a corporation, its outstanding partnership
interests (the "Partnership Interests")if it is a partnership and
its outstanding limited liability company interests, interests
assigned to managers thereof and the voting rights associated
therewith (the "LLC Interests")if it is a limited liability
company. The Borrower and each Subsidiary of the Borrower has
good and marketable title to all of the Subsidiary Shares,
Partnership Interests and LLC Interests it purports to own, free
and clear in each case of any Lien. All Subsidiary Shares,
Partnership Interests and LLC Interests have been validly issued,
and all Subsidiary Shares are fully paid and nonassessable. All
capital contributions and other consideration required to be made
or paid in connection with the issuance of the Partnership
Interests and LLC Interests have been made or paid, as the case
may be. There are no options, warrants or other rights
outstanding to purchase any such Subsidiary Shares, Partnership
Interests or LLC Interests except as indicated on Schedule 6.1.2.
6.1.3 Power and Authoritv. Each Loan Party has full power to enter
into, execute, deliver and carry out this Agreement and the other
Loan Documents to which it is a party, to incur the Indebtedness
contemplated by the Loan Documents and to perform its Obligations
under the Loan Documents to which it is a party, and all such
actions have been duly authorized by all necessary proceedings on
its part.
6.1.4 Validitv and Bindinp Effect. This Agreement has been duly and
validly executed and delivered by each Loan Party, and each other
Loan Document which any Loan Party is required to execute and
deliver on or after the date hereof will have been duly executed
and delivered by such Loan Party on the required date of delivery
of such Loan Document. This Agreement and each other Loan
Document constitutes, or will constitute, legal, valid and
binding obligations of each Loan Party which is or will be a
party thereto on and after its date of delivery thereof,
enforceable against such Loan Party in accordance with its terms,
except to the extent that enforceability of any of such Loan
Document may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforceability of creditors'rights generally or limiting the
right of specific performance.
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6.1.5 No Conflict. Neither the execution and delivery of this
Agreement or the other Loan Documents by any Loan Party nor the
consummation of the transactions herein or therein contemplated
or compliance with the terms and provisions hereof or thereof by
any of them will conflict with, constitute a default under or
result in any breach of (i)the terms and conditions of the
certificate of incorporation, bylaws, certificate of limited
partnership, partnership agreement, certificate of formation,
limited liability company agreement or other organizational
documents of any Loan Party or (ii)any Law or any material
agreement or instrument or order, writ, judgment, injunction or
decree to which any Loan Party or any of its Subsidiaries is a
party or by which it or any of its Subsidiaries is bound or to
which it is subject, or result in the creation or enforcement of
any Lien, charge or encumbrance whatsoever upon any property (now
or hereafter acquired)of any Loan Party or any of its
Subsidiaries (other than Liens granted under the Loan Documents).
6.1.6 Litipation. There are no actions, suits, proceedings or
investigations pending or, to the knowledge of any Loan Party,
threatened against such Loan Party or any Subsidiary of such Loan
Party at law or equity before any Official Body which
individually or in the aggregate may result in any Material
Adverse Change. None of the Loan Parties or any Subsidiaries of
any Loan Party is in violation of any order, writ, injunction or
any decree of any Official Body which may result in any Material
Adverse Change.
6.1.7 Title to Properties. Each Loan Party and each Subsidiary of each
Loan Party has good and marketable title to or valid leasehold
interest in all properties, assets and other rights which it
purports to own or lease or which are reflected as owned or
leased on its books and records, free and clear of all Liens and
encumbrances except Permitted Liens and the lien against
Borrower's property in favor of IRON Solutions, Inc. in
connection with the judgment dated November 1, 1999 in the amount
of $30,000, and subject to the terms and conditions of the
applicable leases. All leases of property are in full force and
effect without the necessity for any consent that has not
previously been obtained upon consummation of the transactions
contemplated hereby.
6.1.8 Financial Statements.
6.1.8.1 Historical Statements. The Borrower has delivered to the
Agent copies of its audited consolidated year-end financial
statements for and as of the end of the fiscal year ended
December 3 1, 1999 (the "Annual Statements"). In addition,
the Borrower has delivered to the Agent copies of its
unaudited consolidated interim financial statements for the
fiscal year to date and as of the end of the fiscal quarter
ended March 3 1, 2000 (the "Interim Statements")(the Annual
and Interim Statements being collectively referred to as the
-33-
"Historical Statements"). The Historical Statements were
compiled from the books and records maintained by the
Borrower's management, are correct and complete and fairly
represent the consolidated financial condition of the
Borrower and its Subsidiaries as of their dates and the
results of operations for the fiscal periods then ended and
have been prepared in accordance with GAAP consistently
applied, subject (in the case of the Interim Statements)to
normal year-end audit adjustments.
6.1.8.2 Financial Proiections. The Borrower has delivered to the
Agent financial projections of the Borrower and its
Subsidiaries for the period ending December 31, 2000 derived
from various assumptions of the Borrower's management (the
"Financial Projections"). The Financial Projections
represent a reasonable range of possible results in light of
the history of the business, present and foreseeable
conditions and the intentions of the Borrower's management.
The Financial Projections accurately reflect the liabilities
of the Borrower and its Subsidiaries upon consummation of
the transactions contemplated hereby as of the Closing Date.
6.1.8.3 Accuracy of Financial Statements. Neither the Borrower
nor any Subsidiary of the Borrower, has any liabilities,
contingent or otherwise, or forward or long-term commitments
that are not disclosed in the Historical Statements or in
the notes thereto, and except as disclosed therein there are
no unrealized or anticipated losses from any commitments of
the Borrower or any Subsidiary of the Borrower which may
cause a Material Adverse Change. Since December 3 1,1999, no
Material Adverse Change has occurred.
6.1.9 Use of Proceeds; Margin Stock; Section 20 Subsidiaries.
6.1.9.1 General. The Loan Parties intend to use the proceeds of
the Loans in accordance with Sections 2.6,3.3 and u 8 1 10
6.1.9.2 Margin Stock. None of the Loan Parties or any
Subsidiaries of any Loan Party engages or intends to engage
principally, or as one of its important activities, in the
business of extending credit for the purpose, immediately,
incidentally or ultimately, of purchasing or carrying margin
stock (within the meaning of Regulation U). No part of the
proceeds of any Loan has been or will be used, immediately,
incidentally or ultimately, to purchase or carry any margin
stock or to extend credit to others for the purpose of
purchasing or carrying any margin stock or to refund
Indebtedness originally incurred for such purpose, or for
any purpose which entails a violation of or which is
inconsistent with the provisions of the regulations of the
Board of Governors of the Federal Reserve
-34-
System. None of the Loan Parties or any Subsidiary of any
Loan Party holds or intends to hold margin stock in such
amounts that more than 25%of the reasonable value of the
assets of any Loan Party or Subsidiary of any Loan Party are
or will be represented by margin stock.
6.1.9.3 Section 20 Subsidiaries. The Loan Parties do not intend
to use and shall not use any portion of the proceeds of the
Loans, directly or indirectly, to purchase during the
underwriting period, or for thirty (30)days thereafter,
Ineligible Securities being underwritten by a Section 20
Subsidiary.
6.1.10 Full Disclosure. Neither this Agreement nor any other Loan
Document, nor any certificate, statement, agreement or other
documents furnished to the Agent or any Bank in connection
herewith or therewith, contains any untrue statement of a
material fact or omits to state a material fact necessary in
order to make the statements contained herein and therein, in
light of the circumstances under which they were made, not
misleading. There is no fact known to any Loan Party which
materially adversely affects the business, property, assets,
financial condition, results of operations or prospects of any
Loan Party or Subsidiary of any Loan Party which has not been set
forth in this Agreement or in the certificates, statements,
agreements or other documents furnished in writing to the Agent
and the Banks prior to or at the date hereof in connection with
the transactions contemplated hereby.
6.1.11 Taxes. All federal, state, local and other tax returns required
to have been filed with respect to each Loan Party and each
Subsidiary of each Loan Party have been filed, and payment or
adequate provision has been made for the payment of all taxes,
fees, assessments and other governmental charges which have or
may become due pursuant to said returns or to assessments
received, except to the extent that such taxes, fees, assessments
and other charges are being contested in good faith by
appropriate proceedings diligently conducted and for which such
reserves or other appropriate provisions, if any, as shall be
required by GAAP shall have been made. There are no agreements or
waivers extending the statutory period of limitations applicable
to any federal income tax return of any Loan Party or Subsidiary
of any Loan Party for any period.
6.1.12 Consents and Approvals. No consent, approval, exemption, order
or authorization of, or a registration or filing with, any
Official Body or any other Person is required by any Law or any
agreement in connection with the execution, delivery and carrying
out of this Agreement and the other Loan Documents by any Loan
Party, except as listed on Schedule 6.1.12, all of which shall
have been obtained or made on or prior to the Closing Date except
as otherwise indicated on Schedule 6.1.12.
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6.1.13 No Event of Default; Compliance with Instruments. No event has
occurred and is continuing and no condition exists or will exist
after giving effect to the borrowings or other extensions of
credit to be made on the Closing Date under or pursuant to the
Loan Documents which constitutes an Event of Default or Potential
Default. None of the Loan Parties or any Subsidiaries of any Loan
Party is in violation of(i)any term of its certificate of
incorporation, bylaws, certificate of limited partnership,
partnership agreement, certificate of formation, limited
liability company agreement or other organizational documents or
(ii)any material agreement or instrument to which it is a party
or by which it or any of its properties may be subject or bound
where such violation would constitute a Material Adverse Change.
6.1.14 Patents, Trademarks, Copyrights, Licenses. Etc. Each @. n Party
and each Subsidiary of each Loan Party owns or possesses all the
material patents, trademarks, service marks, trade names,
copyrights, licenses, registrations, franchises, permits and
rights necessary to own and operate its properties and to carry
on its business as presently conducted and planned to be
conducted by such Loan Party or Subsidiary, without known
possible, alleged or actual conflict with the rights of others.
6.1.15 Insurance. No notice has been given or claim made and no
grounds exist to cancel or avoid any of such policies or bonds or
to reduce the coverage provided thereby. Such policies and bonds
provide adequate coverage from reputable and financially sound
insurers in amounts sufficient to insure the assets and risks of
each Loan Party and each Subsidiary of each Loan Party in
accordance with prudent business practice in the industry of the
Loan Parties and their Subsidiaries.
6.1.16 Compliance with Laws. The Loan Parties and their Subsidiaries
are in compliance in all material respects with all applicable
Laws (other than Environmental Laws which are specifically
addressed in Section in all jurisdictions in which any Loan Party
or Subsidiary of any Loan Party is presently or will be doing
business except where the failure to do so would not constitute a
Material Adverse Change.
6.1.17 Material Contracts: Burdensome Restrictions. All material
contracts relating to the business operations of each Loan Party
and each Subsidiary of any Loan Party, including all employee
benefit plans and Labor Contracts are valid, binding and
enforceable upon such Loan Party or Subsidiary and each of the
other parties thereto in accordance with their respective terms,
and there is no default thereunder, to the Loan Parties'
knowledge, with respect to parties other than such Loan Party or
Subsidiary. None of the Loan Parties or their Subsidiaries is
bound by any contractual obligation, or subject to any
restriction in any organization document, or any requirement of
Law that could result in a Material Adverse Change.
-36-
6.1.18 Investment Companies: Regulated Entities. None of the Loan
Parties or any Subsidiaries of any Loan Party is an "investment
company" registered or required to be registered under the
Investment Company Act of 1940 or under the "control" of an
"investment company" as such terms are defined in the Investment
Company Act of 1940 and shall not become such an "investment
company" or under such "control." None of the Loan Parties or any
Subsidiaries of any Loan Party is subject to any other Federal
state statute or regulation limiting its ability to incur
Indebtedness for borrowed money.
6.1.19 Borrowinp Base Certificate. The Borrower has delivered to Agent
a duly completed Borrowing Base Certificate.
6.1.20 Plans and Benefit Arrangements. Except as set forth on Schedule
6.1.l.20.
6.1.20.1 The Borrower and each other member of the ERlSA Group
are in compliance in all material respects with any
applicable provisions of ERlSA with respect to all Benefit
Arrangements, Plans and Multiemployer Plans. There has been
no Prohibited Transaction with respect to any Benefit
Arrangement or any Plan or, to the best knowledge of the
Borrower, with respect to any Multiemployer Plan or Multiple
Employer Plan, which could result in any material liability
of the Borrower or any, other member of the ERlSA Group. The
Borrower and all other members of the ERlSA Group have made
when due any and all payments required to be made under any
agreement relating to a Multiemployer Plan or a Multiple
Employer Plan or any Law pertaining thereto. With respect to
each Plan and Multiemployer Plan, the Borrower and each
other member of the ERlSA Group (i)have fulfilled in all
material respects their obligations under the minimum
funding standards of ERlSA, (ii)have not incurred any
liability to the PBGC, and (iii)have not had asserted
against them any penalty for failure to fulfill the minimum
funding requirements of ERISA. All Plans, Benefit
Arrangements and Multiemployer Plans have been administered
in accordance with their terms and applicable Law.
6.1.20.2 No event requiring notice to the PBGC under Section
302@)(4)(A)of ERlSA has occurred or is reasonably expected
to occur with respect to any Plan, and no amendment with
respect to which security is required under Section 307 of
ERISA has been made or is reasonably expected to be made to
any Plan,
6.1.20.3 Neither the Borrower nor any other member of the ERlSA
Group has incurred or reasonably expects to incur any
material withdrawal liability under ERISA to any
Multiemployer Plan or Multiple Employer Plan. Neither the
Borrower nor any other
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member of the ElUSA Group has been notified by any
Multiemployer Plan or Multiple Employer Plan that such
Multiemployer Plan or Multiple Employer Plan has been
terminated within the meaning of Title IV of ERlSA and, to
the best knowledge of the Borrower, no Multiemployer Plan or
Multiple Employer Plan is reasonably expected to be
reorganized or terminated, within the meaning of Title lV of
ERlSA.
6.1.21 Employment Matters. Each of the Loan Parties and each of their
Subsidiaries is in compliance with the Labor Contracts and all
applicable federal, state and. local labor and employment Laws
including those related to equal employment opportunity and
affirmative action, labor relations, minimum wage, overtime,
child labor, medical insurance continuation, worker adjustment
and relocation notices, immigration controls and worker and
unemployment compensation, where the failure to comply would
constitute a Material Adverse Change. There are no outstanding
grievances, arbitration awards or appeals therefrom arising out
of the Labor Contracts or current or threatened strikes,
picketing, handbilling or other work stoppages or slowdowns at
facilities of any of the Loan Parties or any of their
Subsidiaries which in any case would constitute a Material
Adverse Change. The Borrower has delivered to the Agent true and
correct copies of each of the Labor Contracts.
6.1.22 Environmental Matters.
6.1.22.1 None of the Loan Parties or any Subsidiaries of any Loan
Party has received any Environmental Complaint, including
but not limited to those from any Official Body or private
Person alleging that such Loan Party or Subsidiary or any
prior owner, operator or occupant of any of the Property is
a potentially responsible party under the Comprehensive
Environmental Response, Cleanup and Liability Act, 42 U. S.
C. 9 9601, et seq., or any analogous state or local Law, and
none of the Loan Parties has any reason to believe that such
an Environmental Complaint might be received. There are no
pending or, to any Loan Party's knowledge, threatened
Environmental Complaints relating to any Loan Party or
Subsidiary of any Loan Party or, to any Loan Party's
knowledge, any prior owner, operator or occupant of any of
the Properties pertaining to, or arising out of, any
Contamination or violations of Environmental Laws or
Required Environmental Permits.
6.1.23 Senior Debt Status. The Obligations of each Loan Party under
this Agreement, the Notes, the Guaranty Agreement and each of the
other Loan Documents to which it is a party do rank and will rank
at least & m in priority of payment with all other Indebtedness
of such Loan Party except indebtedness of such Loan Party to the
extent secured by
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Permitted Liens. There is no Lien upon or with respect to any of
the properties or income of any Loan Party or Subsidiary of any
Loan Party that secures indebtedness or other obligations of any
Person except for Permitted Liens.
6.1.24 Appraisals and Collateral Audit. Agent shall have received
appraisals, collateral audits, or valuations of the Borrower's
assets as Agent may require in form and substance satisfactory to
Agent in all respects.
6.2 Continuation of Representations. The Loan Parties make the
representations and warranties in this Section 6 on the date hereof
and on the Closing Date and each date thereafter on which a Loan is
made provided in and subject to Sections 7.1 and 7.2.
7. CONDITIONS OF LENDING. The obligation of each Bank to make Loans hereunder
is subject to the performance by each of the Loan Parties of its
Obligations to be performed hereunder at or prior to the making of any such
Loans and to the satisfaction of the following further conditions:
7.1 Initial Advances. On the Closing Date:
7.1.1 Officer's Certificate. The representations and warranties of
each of the Loan Parties contained in Section 6 and in each of
the other Loan Documents shall be true and accurate on and as of
the Closing Date with the same effect as though such
representations and warranties had been made on and as of such
date (except representations and warranties which relate solely
to an earlier date or time, which representations and warranties
shall be true and correct on and as of the specific dates or
times referred to therein), and each of the Loan Parties shall
have performed and complied with all covenants and conditions
hereof and thereof, no Event of Default or Potential Default
shall have occurred and be continuing or shall exist; and there
shall be delivered to the Agent for the benefit of each Bank a
certificate of each of the Loan Parties, dated the Closing Date
and signed by the Chief Executive Off&r, President or Chief
Financial Offker of each of the Loan Parties, to each such
effect.
7.1.2 Secretary's Certificate. There shall be delivered to the Agent
for the benefit of each Bank a certificate dated the Closing Date
and signed by the Secretary or an Assistant Secretary of each of
the Loan Parties, certifying as appropriate as to:
7.1.2.1 all action taken by each Loan Party in connection with
this Agreement and the other Loan Documents;
7.1.2.2 the names of the officer or officers authorized to sign
this Agreement and the other Loan Documents and the true
signatures of such officer or officers and specifying the
Authorized Officers permitted to act on behalf of each Loan
Party for purposes of this
-39-
Agreement and the true signatures of such officers, on which
the Agent and each Bank may conclusively rely; and
7.1.2.3 copies of its organizational documents, including its
certificate of incorporation, bylaws, certificate of limited
partnership, partnership agreement, certificate of
formation, and limited liability company agreement as in
effect on the Closing Date certified by the appropriate
state official where such documents are filed in a state
office together with certificates from the appropriate state
officials as to the continued existence and good standing of
each Loan Party in each state where organized or qualified
to do business and a bring-down certificate by facsimile
dated the Closing Date.
7.1.3 Delivery of Guaranty Agreements. The Guaranty Agreement shall
have been duly executed and delivered to the Agent for the
benefit of the Banks.
7.1.4 Opinion of Counsel. The Agent and each Bank has received an
opinion of counsel for the Loan Parties directed to the Agent and
the Lenders in form and substance and from counsel acceptable to
the Agent.
7.1.5 LePal Details. All legal details and proceedings in connection
with the transactions contemplated by this Agreement -and the
other Loan Documents shall be in form and substance satisfactory
to the Agent and counsel for the Agent, and the Agent shall have
received all such other counterpart originals or certified or
other copies of such documents and proceedings in connection with
such transactions, in form and substance satisfactory to the
Agent and said counsel, as the Agent or said counsel may
reasonably request.
7.1.6 Payment of Fees. The Borrower shall have paid or caused to be
paid to the Agent the Renewal Fee and other fees accrued through
the Closing Date and the costs and expenses for which the Agent
and the Banks are entitled to be reimbursed, including the
payment of costs incurred by Agent as reimbursement for
appraisals in the amount of $11,800.
7.1.7 Consents. All material consents required to effectuate the
transactions contemplated hereby as set forth on Schedule 6.1.12
shall have been obtained.
7.1.8 Offricer's Certificate ReParding MACs. No Material Adverse
Change shall have occurred; prior to the Closing Date, there
shall have been no material change in the management of any Loan
Party or Subsidiary of any Loan Party; and there shall have been
delivered to the Agent for the benefit of each Bank a certificate
dated the Closing Date and signed by the
-40-
Chief Executive Officer, President or Chief Financial Officer of
each Loan Party to each such effect.
7.1.9 No Violation of Laws. The making of the Loans shall not
contravene any Law applicable to any Loan Party or any of the
Banks.
7.1.10 No Actions or Proceedinps. No action, proceeding,
investigation, regulation or legislation shall have been
instituted, threatened or proposed before any court, governmental
agency or legislative body to enjoin, restrain or prohibit, or to
obtain damages in respect of, this Agreement, the other Loan
Documents or the consummation of the transactions contemplated
hereby or thereby or which, in the Agent's sole discretion, would
make it inadvisable to consummate the transactions contemplated
by this Agreement or any of the other Loan Documents.
7.1.11 Borrowing Base Certificate. The Agent shall have received from
the Borrower a duly completed Borrowing Base Certificate.
7.2 Each Additional Loan. At the time of making any Loans other than Loans
made on the Closing Date and after giving effect to the proposed
extensions of credit: the representations and warranties of the Loan
Parties contained in Section 6 and in the other Loan Documents shall
be true on and as of the date of such additional Loan with the same
effect as though such representations and warranties had been made on.
and as of such date (except representations and warranties-which .',
expressly relate solely to an earlier date or time, which
representations and warranties shall be true and correct on and as of
the specific dates or times referred to therein)and the Loan Parties
shall have performed and complied with all covenants and conditions
hereof; no Event of Default or Potential Default shall have occurred
and be continuing or shall exist; the making of the Loans shall not
contravene any Law applicable to any Loan Party or Subsidiary of any
Loan Party or any of the Banks; and the Borrower shall have delivered
to the Agent a duly executed and completed Loan Request as the case
may be.
8. COVENANTS.
8.1 Affirmative Covenants. The Loan Parties, jointly and severally,
covenant and agree that until payment in full of the Loans and
interest thereon, satisfaction of all of the Loan Parties'other
Obligations under the Loan Documents and termination of the
Commitments, the Loan Parties shall comply at all times with the
following affirmative covenants:
8.1.1 Preservation of Existence, Etc. Each Loan Party shall, and shall
cause each of its Subsidiaries to, maintain its legal existence
as a corporation, limited partnership or limited liability
company and its license or qualification and good standing in
each jurisdiction in which its ownership or lease of property or
the nature of its business makes
-41-
such license or qualification necessary, except as otherwise
expressly permitted in Section 8.2.5.
8.1.2 Payment of Liabilities. Includine Taxes, Etc. Each Loan Party
shall, and shall cause each of its Subsidiaries to, duly pay and
discharge all liabilities to which it is subject or which are
asserted against it, promptly as and when the same shall become
due and payable, including all taxes, assessments and
governmental charges upon it or any of its properties, assets,
income or profits, prior to the date on which penalties attach
thereto, except to the extent that such liabilities, including
taxes, assessments or charges, are being contested in good faith
and by appropriate and lawful proceedings diligently conducted
and for which such reserve or other appropriate provisions, if
any, as shall be required by GASP shall have been made, but only
to the extent that failure to discharge any such liabilities
would not result in any additional liability which would
adversely affect to a material extent the financial condition of
any Loan Party or Subsidiary of any Loan Party or which would
affect the Collateral, provided that the Loan Parties and their
Subsidiaries will pay all such liabilities forthwith upon the
commencement of proceedings to foreclose any Lien which may have
attached as security therefor.
8.1.3 Maintenance of Insurance. Each Loan Party shall, and shall cause
each of its Subsidiaries to, insure its properties and assets
against loss or damage by fire and such other insurable hazards
as such assets are commonly insured (including fire, extended
coverage, property damage, workers'compensation, public liability
and business interruption insurance)and against other risks
(including errors and omissions)in such amounts as similar
properties and assets are insured by prudent companies in similar
circumstances carrying on similar businesses, and with reputable
and financially sound insurers, including self-insurance to the
extent customary, all as reasonably determined by the Agent.
8.1.4 Maintenance of Properties and Leases. Each Loan Party shall, and
shall cause each of its Subsidiaries to, maintain in good repair,
working order and condition (ordinary wear and tear excepted)in
accordance with the general practice of other businesses of
similar character and size, all of those properties useful or
necessary to its business, and from time to time, such Loan Party
will make or cause to be made all appropriate repairs, renewals
or replacements thereof
8.1.5 Maintenance of Patents, Trademarks, Etc. Each Loan Party shall,
and shall cause each of its Subsidiaries to, maintain in full
force and effect all patents, trademarks, service marks, trade
names, copyrights, licenses, franchises, permits and other
authorizations necessary for the
-42-
ownership and operation of its properties and business if the
failure so to maintain the same would constitute a Material
Adverse Change.
8.1.6 Visitation Rights. Each Loan Party shall, and shall cause each
of its Subsidiaries to, permit any of the officers or authorized
employees or representatives of the Agent or any of the Banks to
visit and inspect any of its properties or the Collateral and to
examine and make excerpts from its books and records for the
purpose of verifying the amount, quality, quantity, value and
condition of, or any other matter relating to the properties or
the Collateral and discuss its business affairs, finances and
accounts with its officers, all in such detail and at such times
and as often as any of the Banks may reasonably request, provided
that each Bank shall provide the Borrower and the Agent with
reasonable notice ,prior to any visit or inspection. ln the event
any Bank desires to conduct an audit of any Loan Party, such Bank
shall make a reasonable effort to conduct such audit
contemporaneously with any audit to be performed by the Agent.
8.1.7 KeepinP of Records and Books of Account. The Borrower shall, and
shall cause each Subsidiary of the Borrower to, maintain and keep
proper books of record and account which enable the Borrower and
its Subsidiaries to issue financial statements in accordance with
GASP and as otherwise required by applicable Laws of any Official
Body having jurisdiction over the Borrower or any Subsidiary of
the Borrower, and in which full, true and correct entries shall
be made in all material respects of all its dealings and business
and financial affairs.
8.1.8 Plans and Benefit Arranpements. The Borrower shall, and shall
cause each other member of the ERlSA Group to, comply with ERlSA,
the Internal Revenue Code and other applicable Laws applicable to
Plans and Benefit Arrangements except where such failure, alone
or in conjunction with any other failure, would not result in a
Material Adverse Change. Without limiting the generality of the
foregoing, the Borrower shall cause all of its Plans and all
Plans maintained by any member of the ERISA Group to be funded in
accordance with the minimum funding requirements of ERlSA and
shall make, and cause each member of the ERlSA Group to make, in
a timely manner, all contributions due to Plans, Benefit
Arrangements and Multiemployer Plans.
8.1.9 Compliance with Laws. Each Loan Party shall, and shall cause
each of its Subsidiaries to, comply with all applicable Laws,
including all Environmental Laws, in all respects, provided that
it shall not be deemed to be a violation of this Section 8.1.9 if
any failure to comply with any Law would not result in fines,
penalties, remediation costs,
-43-
other similar liabilities or injunctive relief which in the
aggregate would constitute a Material Adverse Change.
8.1.10 Use of Proceeds. The Loan Parties will use the proceeds of the
Loans only for general corporate purposes and for working
capital. The Loan Parties will not use of the proceeds of the
Loans for any purposes which contravenes any applicable Law or
any provision hereof
8.2 Negative Covenants. The Loan Parties, jointly and severally, covenant
and agree that until payment in full of the Loans and interest
thereon, satisfaction of all of the Loan Parties'other Obligations
hereunder and termination of the Commitments, the Loan Parties shall
comply with the following negative covenants:
8.2.1 Indebtedness. Each of the Loan Parties shall not, and shall not
permit any of its Subsidiaries to, at any time create, incur,
assume or suffer to exist any Indebtedness, except:
8.2.1.1 Indebtedness under the Loan Documents;
8.2.1.2 Existing Indebtedness as set forth on Schedule 8.2.1
(including any extensions or renewals thereof, provided
there is no increase in the amount thereof or other
significant change in the terms thereof unless otherwise
specified on Schedule 8.2.1; and
8.2.1.3 Capitalized and operating leases as and to the extent
permitted under Section 8.2.13.
8.2.2 Each Liens. of the Loan Parties shall not, and shall not permit
any of its Subsidiaries to, at any time create, incur, assume or
suffer to exist any Lien on any of its property or assets,
tangible or intangible, now owned or hereafter acquired, or agree
or become liable to do so, except Permitted Liens.
8.2.3 Guaranties. Each of the Loan Parties shall not, and shall not
permi~any of its Subsidiaries to, at any time, directly or
indirectly, become or be liable in respect of any Guaranty, or
assume, guarantee, become surety for, endorse or otherwise agree,
become or remain directly or contingently liable upon or with
respect to any obligation or liability of any other Person,
except for Guaranties of Indebtedness of the Loan Parties
permitted hereunder.
8.2.4 Loans and Investments. Each of the Loan Parties shall not, and
shall not permit any of its Subsidiaries to, at any time make 'or
suffer to remain outstanding any loan or advance to, or purchase,
acquire or own any stock, bonds, notes or securities of, or any
partnership interest (whether general or limited)or limited
liability company interest in, or any other investment
-44-
or interest in, or make any capital contribution to, any other
Person, or agree, become or remain liable to do any of the
foregoing, except:
8.2.4.1 trade credit extended on usual and customary terms in the
ordinary course of business;
8.2.4.2 advances to employees to meet expenses incurred by such
employees in the ordinary course of business;
8.2.4.3 Permitted Investments; and
8.2.4.4 loans, advances and investments in other Loan Parties.
8.2.5 Liquidations. Mergers. Consolidations. Each of the Loan Parties
shall not, and shall not permit any of its Subsidiaries to,
dissolve, liquidate or wind-up its affairs, or become a party to
any merger or consolidation, or acquire by purchase, lease or
otherwise all or substantially all of the assets or capital stock
of any other Person, provided that any Loan Party other than the
Borrower may consolidate or merge into another Loan Party which
is wholly-owned by one or more of the other Loan Parties.
8.2.6 Dispositions of Assets or Subsidiaries. Each of the Loan Parties
shall not, and shall not permit any of its Subsidiaries to, sell,
convey, assign, lease, abandon or otherwise transfer or dispose
of, voluntarily or involuntarily, any of its properties or
assets, tangible or intangible (including sale, assignment,
discount or other disposition of accounts, contract rights,
chattel paper, equipment or general intangibles with or without
recourse or. of capital stock, shares of beneficial interest,
partnership interests or limited liability company interests of a
Subsidiary of such Loan Party), except:
8.2.6.1 transactions involving the sale of inventory in the
ordinary course of business;
8.2.6.2 any sale, transfer or lease of assets in the ordinary
course of business which are no longer necessary or required
in the conduct of such Loan Party's or such Subsidiary's
business;
8.2.6.3 any sale, transfer or lease of assets by any wholly owned
Subsidiary of such Loan Party to another Loan Party;
8.2.6.4 any sale, transfer or lease of assets in the ordinary
course of business which are replaced by substitute assets
acquired or leased within the parameters of Section 8.2.13;
or
8.2.6.5 any sale, transfer or lease of assets, other than those
specifically excepted pursuant to clauses (i)through
(iv)above, which is approved by the Required Banks so long
as the after-tax proceeds
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(as reasonably estimated by the Borrower)are applied as a
mandatory prepayment of the Term Loans in accordance with
the provisions of Section 5.6.2 above.
8.2.7 Affiliate Transactions. Each of the Loan Parties shall not, and
shall not permit any of its Subsidiaries to, enter into or carry
out any transaction (including purchasing property or services
from or selling property or services to any Affiliate of any Loan
Party or other Person)unless such transaction is not otherwise
prohibited by this Agreement, is entered into in the ordinary
course of business upon fair and reasonable arm%-length terms and
conditions which are fully disclosed to the Agent and is in
accordance with all applicable law.
8.2.8 Subsidiaries. Partnerships and Joint Ventures. Each of the Loan
Parties shall not, and shall not permit any of its Subsidiaries
to, own or create directly or indirectly any Subsidiaries other
than (i)any Subsidiary which has joined this Agreement as
Guarantor on the Closing Date; and (ii)any Subsidiary formed
after the Closing Date which joins this Agreement as a Guarantor
pursuant to Section 11.17. Each of the Loan Parties shall not
become or agree to (1)become a general or limited partner in any
general or limited partnership, except that the Loan Parties may
be general or limited partners in other Loan Parties, (2)become a
member or manager of, or hold a limited liability company
interest in, a limited liability company, except that the Loan
Parties may be members or managers of, or hold limited liability
company interests in, other Loan Parties, or (3)become a joint
venturer or hold a joint venture interest in any joint venture.
8.2.9 Change of Control. Each of the Loan Parties shall not, and shall
not permit any of its Subsidiaries to amend in any respect its
certificate of incorporation (including any provisions or
resolutions relating to capital stock), by-laws, certificate of
limited partnership, partnership agreement, certificate of
formation, limited liability company agreement or other
organizational documents without providing at least sixty
(60)calendar days'prior written notice to Agent and the Banks
and, in the event such change would be adverse to the Banks as
determined by Agent in its sole discretion, obtaining the prior
written consent of the Required Banks.
8.2.10 Continuation of or Chawe in Business. Each of the Loan Parties
shall not, and shall not permit any of its Subsidiaries to,
engage in any business other than that in which it is currently
engaged, substantially as conducted and operated by such Loan
Party or Subsidiary during the present fiscal year, and such Loan
Party or Subsidiary shall not permit any material change in such
business.
8.2.11 Plans and Benefit Arrawements. Each of the Loan Parties shall
not, and shall not permit any of its Subsidiaries to, engage in a
Prohibited
-46-
Transaction with any Plan, Benefit Arrangement or Multiemployer
Plan which, along or in conjunction with any other circumstances
or set of circumstances resulting in liability under ERISA or
otherwise violate ERlSA.
8.2.12 Fiscal Year. The Borrower shall not, and shall not permit any
Subsidiary of the Borrower to, change its fiscal year from the
twelve-month period beginning January 1" and ending December 3
1".
8.2.13 Capital Expenditures. The Borrower will not make Capital
Expenditures which, when calculated in accordance with generally
accepted accounting principles, would exceed $250,000 in the
aggregate during any fiscal year. Unexpended amounts from the
prior fiscal year may not be carried forward to the next fiscal
year."
8.2.14 MAximum Leverage Ratio. The Loan Parties shall not at any time
permit the ratio of consolidated total liabilities of the
Borrower to Tangible Net Worth to exceed the ratio of 1.90 to 1
.O.
8.2.15 EBITDA. The Borrower shall not permit EBITDA calculated as of
the end of month, to be less than the following amounts for the
following periods: (1)$800,000 for the month ending July 3 1,
2000; (2)$960,000 for the month ending August 3 1, 2000;
(3)$1,090,000 for the month ending September 30, 2000;
(4)$1,200,000 for the month ending October 3 1, 2000;
(5)$1,325,000 for the month ending November 30, 2000; and
(6)$1,475,000 for the month ending December 3 1, 2000 and for
each month thereafter on a going forward basis.
8.2.16 Minimum Tawible Net Worth. The Borrower will not permit the
Borrower's Tangible Net Worth to be less than $6,000,000.00 at
any time.
8.2.17 Minimum Current Ratio. The Loan Parties shall not at any time
permit the ratio of consolidated Current Assets of the Borrower
and its Subsidiaries to consolidated current liabilities of the
Borrower and its Subsidiaries to be less than 0.75 to 1 .O.
8.2.18 Dividends. The Borrower will not declare or pay any
distributions to its partners or redeem any partnership
interests. Notwithstanding the above, for as long as the Borrower
elects to be taxed as a Subchapter S corporation for federal
income tax purposes, Borrower may, upon the prior written consent
of Agent, pay distributions to Xxxxxxxxx Partners, L. P. in an
amount equal to the amount necessary to cover federal, state and
local income taxes payable as a result of income of the Borrower
being included on Xxxxxxxxx Partners, L. P.'s tax returns,
calculated at the actual income tax rate payable.
8.3 Reportiw Requirements. The Loan Parties, jointly and severally,
covenant and agree that until payment in full of the Loans,
Reimbursement Obligations and
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Letter of Credit Borrowings and interest thereon, expiration or
termination of all Letters of Credit, satisfaction of all of the Loan
Parties'other Obligations hereunder and under the other Loan Documents
and termination of the Commitments, the Loan Parties will Finnish or
cause to be furnished-to the Agent and each of the Banks:
8.3.1 Monthlv Financial Statements. As soon as available and in any
event within thirty (30)calendar days after the end of each
calendar month, the Borrower's internally prepared financial
statements of the Borrower with respect to such calendar month,
which financial statements will: (a)be in reasonable detail and
in form reasonably satisfactory to Agent; (b)include a balance
sheet as of the end of such period, profit and loss and surplus
statements for such period and an income statement for such
period; (c) include prior year comparisons; and_(d)be on a
consolidating and consolidated basis for the Borrower and its
Subsidiaries, and for any entity in which the Borrower's
financial information is consolidated in accordance with
generally accepted accounting principles.
8.3.2 Ouarterlv Financial Statements. As soon as available and in any
event within forty-five (45)calendar days after the end of each
of the first three fiscal quarters in each fiscal year, financial
statements of the Borrower, consisting of a consolidated and
consolidating balance sheet as of the end of such fiscal quarter
and related consolidated and consolidating statements of income,
stockholders'equity and cash flows for the fiscal quarter then
ended and the fiscal year through that date, all in reasonable
detail and certified (subject to normal year-end audit
adjustments)by the Chief Executive Officer, President or Chief
F&ncial Officer of the Borrower as having been prepared in
accordance with GASP, consistently applied, and setting forth in
comparative form the respective financial statements for the
corresponding date and period in the previous fiscal year. The
Loan Parties will be deemed to have complied with the delivery
requirements of this Section 8.3.1 if within forty-five (45)days
after the end of their fiscal quarter, the Borrower delivers to
the Agent and each of the Banks a copy of its Form 10-Q as filed
with the SEC and the financial statements contained therein meets
the requirements described in this Section.
8.3.3 Annual Financial Statements. As soon as available and in any
event within ninety (90)days after the end of each fiscal year of
the Borrower, financial statements of the Borrower consisting of
a consolidated balance sheet as of the end of such fiscal year,
and related consolidated statements of income,
stockholders'equity and cash flows for the fiscal year then
ended, all in reasonable detail and setting forth in comparative
form the financial statements as of the end of and for the
preceding fiscal year, and certified by independent certified
public accountants of nationally recognized standing satisfactory
to the Agent. The certificate or report of accountants shall be
free of qualifications (other than any consistency
-48-
qualification that may result from a change in the method used to
prepare the financial statements as to which such accountants
concur)and shall not indicate the occurrence or existence of any
event, condition or contingency which would materially impair the
prospect of payment or performance of any covenant, agreement or
duty of any Loan Party under any of the Loan Documents. The Loan
Parties will be deemed to have complied with the delivery
requirements of this Section 8.3.2 if within ninety (90)days
after the end of their fiscal year the Borrower delivers to the
Agent and each of the Banks a copy of its Annual Report and Form
10-K as filed with the SEC and the financial statements and
certification of public accountants contained therein meets the
requirements described in this Section.
8.3.4 Certificate of the Borrower. Concurrently with the financial
statements of'the Borrower furnished to the Agent and to the
Banks pursuant to Sections 8.3.1, 8.3.2 and 8.3.3, a certificate
of the Borrower signed by the Chief Executive Officer, President
or Chief Financial Officer of the Borrower, in the form of
Exhibit 8.3.4, to the effect that, except as described pursuant
to Section 8.3.4, (i)the representations and warranties of the
Borrower contained in Section 5.10 and in the other Loan
Documents are true on and as of the date of such certificate with
the same effect as though such representations and warranties had
been made on and as of such date (except representations and
warranties which expressly relate solely to an earlier date or
time)and the Loan Parties have performed and complied with all
covenants and conditions hereof, (ii)no Event of Default or
Potential Default exists and is continuing on the date of such
certificate and (iii)containing calculations in sufficient detail
to demonstrate compliance as of the date of such financial
statements with all financial covenants contained in Section 8.2.
8.3.5 Borrowing Base Certificate. With each request for an advance
under the Revolving Credit Note and upon the request from time to
time of Agent, but in no event less often than monthly, furnish
the Agent a Borrowing Base Certificate.
8.3.6 Notice of Default. Promptly after any officer of any Loan Party
has learned of the occurrence of an Event of Default or Potential
Default, a certificate signed by the Chief Executive Officer,
President or Chief Financial Officer of such Loan Party setting
forth the details of such Event of Default or Potential Default
and the action which the such Loan Party proposes to take with
respect thereto.
8.3.7 Notice of Litipation. Promptly after the commencement thereof,
notice of all actions, suits, proceedings or investigations
before or by any Official Body or any other Person against any
Loan Party or Subsidiary of any Loan Party which relate to the
Collateral, involve a claim or series of
-49-
claims in excess of $100,000 or which if adversely determined
would constitute a Material Adverse Change.
8.3.8 Notice of Change in Debt Rating. Within two (2)Business Days
afler Standard &Poor's or Xxxxx'x announces a change in the
Borrower's Debt Rating, notice of such change, Borrower will
deliver together with such notice a copy of any written
notification which Borrower received from the applicable rating
agency regarding such change of Debt Rating.
8.3.9 Sale of Assets. At least thirty (30)calendar days prior thereto,
with respect to any proposed sale or transfer of assets pursuant
to Section 8.2.6.4 or 8.2.6.5.
8.3.10 Other Reports and Information. Promptly upon their becoming
available to the Borrower, such other reports and information as
any of the Banks may horn time to time reasonably request. The
Borrower shall also notify the Banks promptly of the enactment or
adoption of any Law that may result in a Material Adverse Change.
8.3.11 Notices Repardinp Plans and Benefit Arrangements.
8.3.11.1Certain Events. Promptly upon becoming aware of the occurrence
thereof, notice (including the nature of the event and, when
known, any action taken or threatened by the Internal Revenue
Service or the PBGC with respect thereto)of:
8.3.11.1.1 any Reportable Event with respect to the Borrower or
any other member of the ERISA Group (regardless of whether
the obligation to report said Reportable Event to the PBGC
has been waived),
8.3.11.1.2 any Prohibited l%ansaction which could subject
the Borrower or any other member of the ERISA Group to
a civil penalty assessed pursuant to Section 502(i)of
ERISA or a tax imposed by Section 4975 of the Internal
Revenue Code in connection with any Plan, any Benefit
Arrangement or any trust created thereunder,
8.3.11.1.3 any assertion of material withdrawal liability
with respect to any Multiemployer Plan,
8.3.11.1.4 any partial or complete withdrawal from a
Multiemployer Plan by the Borrower or any other member
of the ERISA Group under Title IV of ERISA (or
assertion thereof), where such withdrawal is likely to
result in material withdrawal liability,
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8.3.11.1.5 any cessation of operations (by the Borrower or
any other member of the ERISA Group)at a facility in
the circumstances described in Section 4062(e)of ERISA,
8.3.11.1.6 withdrawal by the Borrower or any other member of
the ERISA Group from a Multiple Employer Plan,
8.3.11.1.7 a failure by the Borrower or any other member of
the ERISA Group to make a payment to a Plan required to
avoid imposition of a Lien under Section 302(f)of
ERISA,
8.3.11.1.8 the adoption of an amendment to a Plan requiring
the provision of security to such Plan pursuant to
Section 307 of ERISA, or
8.3.11.1.9 any change in the actuarial assumptions or
funding methods used for any Plan, where the effect of
such change is to materially increase or materially
reduce the unfunded benefit liability or obligation to
make periodic contributions.
8.3.11.2 Notices of Involuntarv Termination and Annual Promptly
Reports. after receipt thereof, copies of (a)all notices
received by the Borrower or any other member of the ERISA
Group of the PBGC's intent to terminate any Plan admi&stered
or . maintained by the Borrower or any member of the ERISA
Group, or to have a trustee appointed to administer any such
Plan; and (b) at the request of the Agent or any Bank each
annual report (IRS Form 5500 series)and all accompanying
schedules, the most recent actuarial reports, the most
recent financial information concerning the financial status
of each Plan administered or maintained by the Borrower or
any other member of the ERISA Group, and schedules showing
the amounts contributed to each such Plan by or on behalf of
the Borrower or any other member of the ERISA Group in which
any of their personnel participate or from which such
personnel may derive a benefit, and each Schedule B
(Actuarial Information)to the annual report filed by the
Borrower or any other member of the ERISA Group with the
Internal Revenue Service with respect to each such Plan.
8.3.11.3 Notice of Voluntarv Termination. Promptly upon the
filing thereof, copies of any Form 5310, or any successor or
equivalent form to Form 53 10, filed with the PBGC in
connection with the termination of any Plan.
-5l-
9. DEFAULT.
9.1 Events of Default. Au Event of Default shall mean the occurrence or
existence of any one or more of the following events or conditions
(whatever the reason therefor and whether voluntary, involuntary or
effected by operation of Law):
9.1.1 Pavments Under Loan Documents. The Borrower shall fail to pay
(i) any principal of any Loan (including scheduled installments,
mandatory prepayments or the payment due at maturity)when such
principal is due hereunder or (ii)any interest on any Loan or any
other amount owing hereunder or under the other Loan Documents
within (3)Business Days after such interest or other amount
becomes due in accordance with the terms hereof or thereof;
9.1.2 Breach of Warrantv. Any representation or warranty made at any
time by any of the Loan Parties herein or by any of the Loan
Parties in any other Loan Document, or in any certificate, other
instrument or statement furnished pursuant to the provisions
hereof or thereof, shall prove to have been false or misleading
in any material respect as of the time it was made or furnished;
9.1.3 Breach of Negative Covenants or Visitation Rights. Any of the
Loan Parties shall default in the observance or performance of
any covenant contained in Section 8.1.6 or Section 8.2;
9.1.4 Breach of Other Covenants. Any of the Loan Parties shall default
in the observance or performance of any other covenant, condition
or provision hereof or of any other Loan Document and such
default shall continue unremedied for a period of ten
(10)Business Days after any officer of any Loan Party becomes
aware of the occurrence thereof (such grace period to be
applicable only in the event such default can be remedied by
corrective action of the Loan Parties as determined by the Agent
in its sole discretion);
9.1.5 Defaults in Other Agreements or Indebtedness. A default or event
of default shall occur at any time under the terms of any other
agreement involving borrowed money or the extension of credit or
any other Indebtedness under which any Loan Party or Subsidiary
of any Loan Party may be obligated as a borrower or guarantor,
and such breach, default or event of default consists of the
failure to pay (beyond any period of grace permitted with respect
thereto, whether waived or not)any indebtedness when due (whether
at stated maturity, by acceleration or otherwise)or if such
breach or default permits or causes the acceleration of any
indebtedness (whether or not such right shall have been waived)or
the termination of any commitment to lend;
9.1.6 Final Judpments or Orders. Any final judgments or orders for the
payment of money in excess of $50,000 in the aggregate shall be
entered against any Loan Party by a court having jurisdiction in
the premises, -52-
which judgment is not discharged, vacated, bonded or stayed
pending appeal within a period of thirty (30)days from the date
of entry;
9.1.7 Loan Document Unenforceable. Any of the Loan Documents shall
cease to be legal, valid and binding agreements enforceable
against the party executing the same or such party's successors
and assigns (as permitted under the Loan Documents)in accordance
with the respective terms thereof or shall in any way be
terminated (except in accordance with its terms)or become or be
declared ineffective or inoperative or shall in any way be
challenged or contested or cease to give or provide the
respective Liens, security interests, rights, titles, interests,
remedies, powers or privileges intended to be created thereby;
9.1.8 Uninsured Losses; Proceedings Against Assets. Any of the Loan
Parties'or any of their Subsidiaries'assets are attached, seized,
levied upon or subjected to a writ or distress warrant; or such
come within the possession of any receiver, trustee, custodian or
assignee for the benefit of creditors and the same is not cured
within thirty (30)days thereafter;
9.1.9 Notice of Lien or Assessment. A notice of Lien or assessment in
excess of $25,000 which is not a Permitted Lien is filed of
record with respect to all or any part of any of the Loan
Parties'or any of their Subsidiaries' assets by the United
States, or any department, agency or instrumentality thereof, or
by any state, county, municipal or other governmental agency,
including the PBGC, or any taxes or debts owing at any time or
times hereafter to any one of these becomes payable and the same
is not paid within thirty (30)days after the same becomes
payable;
9.1.10 Insolvencv. Any Loan Party or any Subsidiary of a Loan Party
ceases to be solvent or admits in writing its inability to pay
its debts as they mature;
9.1.11 Events RelatinP to Plans and Benefit Arranpements. Any of the
following occurs: (i)any Reportable Event, which the Agent
determines in good faith constitutes grounds for the termination
of any Plan by the PBGC or the appointment of a trustee to
administer or liquidate any Plan, shall have occurred and be
continuing; (ii)proceedings shall have been instituted or other
action taken to terminate any Plan, or a termination notice shall
have been filed with respect to any Plan; (iii)a trustee shall be
appointed to administer or liquidate any Plan; (iv)the PBGC shall
give notice of its intent to institute proceedings to terminate
any Plan or Plans or to appoint a trustee to administer or
liquidate any Plan; and, in the case of the occurrence of (i),
(ii), (iii)or (iv)above, the Agent determines in good faith that
the amount of the Borrower's liability is likely to exceed 10%of
its Consolidated Tangible Net Worth; (v)the Borrower or any
member of the ERISA Group shall fail to make any contributions
when due to a Plan or a Multiemployer Plan; (vi)the Borrower or
any other member of the ERISA Group shall make any amendment to a
Plan with
-53-
respect to which security is required under Section 307 of ERISA;
(vii)the Borrower or any other member of the ERISA Group shall
withdraw completely or partially from a Multiemployer Plan;
(viii)the Borrower or any other member of the ERISA Group shall
withdraw (or shall be deemed under Section 4062(e)of ERISA to
withdraw)from a Multiple Employer Plan; or (ix)any applicable Law
is adopted, changed or interpreted by any Official Body with
respect to or otherwise affecting one or more Plans,
Multiemployer Plans or Benefit Arrangements and, with respect to
any of the events specified in (v), (vi), (vii), (viii)or (ix),
the Agent determines in good faith that any such occurrence would
be reasonably likely to materially and adversely affect the total
enterprise represented by the Borrower and the other members of
the ERISA Group;
9.1.12 Cessation of Business. Any Loan Party or Subsidiary of a Loan
Party ceases to conduct its business as contemplated, except as
expressly permitted under Section 8.2.5 or 8.2.6, or any Loan
Party or Subsidiary of a Loan Party is enjoined, restrained or in
any way prevented by court order from conducting all or any
material part of its business and such injunction, restraint or
other preventive order is not dismissed within thirty (30)days
after the entry thereof;
9.1.13 Involuntarv Proceedinps. A proceeding shall have been
instituted in a court having jurisdiction in the premises seeking
a decree or order for relief in respect of any Loan Party or
Subsidiary of a Loan Party in an involuntary case under any
applicable bankruptcy, insolvency, reorganization or other
similar law now or hereafter in effect, or for the appointment of
a receiver, liquidator, assignee, custodian, trustee,
sequestrator, conservator (or similar official)of any Loan Party
or Subsidiary of a Loan Party for any substantial part of its
property, or for the winding-up or liquidation of its affairs,
and such proceeding shall remain undismissed or unstayed and in
effect for a period of thirty (30) consecutive days or such court
shall enter a decree or order granting any of the relief sought
in such proceeding; or
9.1.14 Voluntary Proceedinps. Any LOan Party or Subsidiary of a Loan
Party shall commence a voluntary case under any applicable
bankruptcy, insolvency, reorganization or other similar law now
or hereafter in effect, shall consent to the entry of an order
for relief in an involuntary case under any such law, or shall
consent to the appointment or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator,
conservator (or other similar official)of itself or for any
substantial part of its property or shall make a general
assignment for the benefit of creditors, or shall fail generally
to pay its debts as they become due, or shall take any action in
furtherance of any of the foregoing.
9.2 Consequences of Event of Default.
-54 -
9.2.1 Events of Default Other Than Bankruutcv. Insolvencv or
ReorPanixation Proceedings. If an Event of Default specified
under Sections 9.1.1 through 9.1.14 shall occur and be
continuing, the Banks and the Agent shall be under no further
obligation to make Revolving Credit Loans, and the Agent may, and
upon the request of the Required Banks, shall by written notice
to the Borrower, take one or both of the following actions:
(i)terminate the Commitments and thereupon the Commitments shall
be terminated and of no further force and effect, or (ii)declare
the unpaid principal amount of the Revolving Credit Notes and
Term Loan then outstanding and all interest accrued thereon, any
unpaid fees and all other Indebtedness of the Borrower to the
Banks hereunder and thereunder to be forthwith due and payable,
and the same shall thereupon become and be immediately due and
payable to the Agent for the benefit of each Bank without
presentment, demand, protest or any other notice of any kind, all
of which are hereby expressly waived; and
9.2.2 Bankruptcv, Insolvency or Reorganization Proceedinps. If an
Event of Default specified under Section 9.1.13 or 9.1.14 shall
occur, the Commitments shall automatically terminate and be of no
further force and effect, the Banks shall be under no further
obligations to make Revolving Credit Loans hereunder and the
unpaid principal amount of the Loans then outstanding and all
interest accrued thereon, any unpaid fees and all other
Indebtedness of the Borrower to the Banks hereunder and
thereunder shall be immediately due and payable, without
presentment, demand, protest or notice of any kind, all of which
are hereby expressly waived; and
9.2.3 Set-off. If an Event of Default shall occur and be continuing,
any Bank to whom any Obligation is owed by any Loan Party
hereunder or under any other Loan Document or any participant of
such Bank which has agreed in writing to be bound by the
provisions of Section 10.13 and any branch, Subsidiary or
Affiliate of such Bank or participant anywhere in the world shall
have the right, in addition to all other rights and remedies
available to it, without notice to such Loan Party, to set-off
against and apply to the then unpaid balance of all the Loans and
all other Obligations of the Borrower and the other Loan Parties
hereunder or under any other Loan Document any debt owing to, and
any other funds held in any manner for the account of, the
Borrower or such other Loan Party by such Bank or participant or
by such branch, Subsidiary or Affiliate, including all funds in
all deposit accounts (whether time or demand, general or special,
provisionally credited or finally credited, or otherwise)now or
hereafter maintained by the Borrower or such other Loan Party for
its own account (but not including funds held in custodian or
trust accounts)with such Bank or participant or such branch,
Subsidiary or Affiliate. Such right shall exist whether or not
any Bank or the Agent shall have made any demand under this
Agreement or any other Loan Document, whether or not such debt
owing to or funds held for the account of the Borrower or such
other Loan Party is or are matured or unmatured and regardless of
the
-55-
existence or adequacy of any Collateral, Guaranty or any other
security, right or remedy available to any Bank or the Agent; and
9.2.4 Suits, Actions, Proceedinps. If an Event of Default shall occur
and be continuing, and whether or not the Agent shall have
accelerated the maturity of Loans pursuant to any of the
foregoing provisions of this Section 9.2, the Agent or any Bank,
if owed any amount with respect to the Loans, may proceed to
protect and enforce its rights by suit in equity, action at law
and/or other appropriate proceeding, whether for the specific
performance of any covenant or agreement contained in this
Agreement or the other Loan Documents, including as permitted by
applicable Law the obtaining of the ex carte appointment of a
receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof
or any other legal or equitable right of the Agent or such Bank;
and
9.2.5 Application of Proceeds. From and after the date on which the
Agent has taken any action pursuant to this Section 9.2 and until
all Obligations of the Loan Parties have been paid in full, any
and all proceeds received by the Agent from the exercise of any
remedy by the Agent, shall be applied as follows:
9.2.5.1 first, to reimburse the Agent and the Banks for
out-of-pocket costs, expenses and disbursements, including
reasonable attorneys'and paralegals'fees and legal expenses,
incurred by the Agent or the Banks in connection with
realizing on the Collateral or collection of any Obligations
of any of the Loan Parties under any of the Loan Documents;
9.2.5.2 second, to the repayment of all Indebtedness then due and
unpaid of the Loan Parties to the Banks incurred under this
Agreement or any of the other Loan Documents, whether of
principal, interest, fees, expenses or otherwise, in such
manner as the Agent may determine in its discretion; and
9.2.5.3 the balance, if any, as required by Law.
9.2.6 Other Riphts and Remedies. In addition to all of the rights and
remedies contained in this Agreement or in any of the other Loan
Documents, the Agent shall have all of the rights and remedies
under applicable Law, all of which rights and remedies shall be
cumulative and non-exclusive, to the extent permitted by Law. The
Agent may, and upon the request of the Required Banks shall,
exercise all post-default rights granted to the Agent and the
Banks under the Loan Documents or applicable Law.
-56-
10. THE AGENT.
10.1 Appointment. Each Bank hereby irrevocably designates, appoints and
authorizes PNC Bank to act as Agent for such Bank under this Agreement
and to execute and deliver or accept on behalf of each of the Banks
the other Loan Documents. Each Bank hereby irrevocably authorizes the
Agent to take such action on its behalf under the provisions of this
Agreement and the other Loan Documents and any other instruments and
agreements referred to herein, and to exercise such powers and to
perform such duties hereunder as are specifically delegated to or
required of the Agent by the terms hereof, together with such powers
as are reasonably incidental thereto. PNC Bank agrees to act as the
Agent on behalf of the Banks to the extent provided in this Agreement.
10.2 Delegation of Duties. The Agent may perform any of its duties
hereunder by or through agents or employees (provided such delegation
does not constitute a relinquishment of its duties as Agent)and,
subject to Sections 10.5 and 10.6, shall be entitled to engage and pay
for the advice or services of any attorneys, accountants or other
experts concerning all matters pertaining to its duties hereunder and
to rely upon any advice so obtained.
10.3 Nature of Duties: Independent Credit Investipation. The Agent shall
have no duties or responsibilities except those expressly set form in
this Agreement and no implied covenants, functions, responsibilities,
duties, obligations, or liabilities shall be read into this Agreement
or otherwise exist. The duties of the Agent shall be mechanical and
administrative in nature; the Agent shall not have by reason of this
Agreement a fiduciary or trust relationship in respect of any Bank;
and nothing in this Agreement, expressed or implied, is intended to or
shall be so construed as to impose upon the Agent any obligations in
respect of this Agreement except as expressly set forth herein.
Without limiting the generality of the foregoing, 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. Each Bank expressly acknowledges
(i)that the Agent has not made any representations or warranties to it
and that no act by the Agent hereafter taken, including any review of
the affairs of any of the Loan Parties, shall be deemed to constitute
any representation or warranty by the Agent to any Bank; (ii)that it
has made and will continue to make, without reliance upon the Agent,
its own independent investigation of the financial condition and
affairs and its own appraisal of the creditworthiness of each of the
Loan Parties in connection with this Agreement and the making and
continuance of the Loans hereunder; and (iii) except as expressly
provided herein, that the Agent shall have no duty or responsibility,
either initially or on a continuing basis, to provide any Bank with
any credit or other information with respect thereto, whether coming
into its possession before the making of any Loan or at any time or
times thereafter.
10.4 Actions in Discretion of Apent; Instructions From the Banks. The Agent
agrees, upon the written request of the Required Banks, to take or
refrain from
-57-
taking any action of the type specified as being within the Agent's
rights, powers or discretion herein, provided that the Agent shall not
be required to take any action which exposes the Agent to personal
liability or which is contrary to this Agreement or any other Loan
Document or applicable Law. In the absence of a request by the
Required Banks, the Agent shall have authority, in its sole
discretion, to take or not to take any such action, unless this
Agreement specifically requires the consent of the Required Banks or
all of the Banks. Any action taken or failure to act pursuant to such
instructions or discretion shall be binding on the Banks, subject to
Section 10.6. Subject to the provisions of Section 10.6,. no Bank
shall have any right of action whatsoever against the Agent as a
result of the Agent acting or refraining from acting hereunder in
accordance with the instructions of the Required Banks, or in the
absence of such instructions, in the absolute discretion of the Agent.
10.5 Reimbursement and Indemnification of Apent bv the Borrower. The
Borrower unconditionally agrees to pay or reimburse the Agent and hold
the Agent harmless against (a)liability for the payment of all
reasonable out-ofpocket costs, expenses and disbursements, including
reasonable fees and expenses of counsel (including the allocated costs
of staff counsel), appraisers and environmental consultants, incurred
by the Agent (i)in connection with the development, negotiation,
preparation, priming, execution, administration, syndication,
interpretation and performance of this Agreement and the other Loan
Documents, (ii)relating to any requested amendments, waivers or
consents pursuant to the. provisions hereof, ,(iii)in connection with
the enforcement of this Agreement or any other Loan Document or
collection of amounts due hereunder or thereunder or the proof and
allowability of any claim arising under this Agreement or any other
Loan Document, whether in bankruptcy or receivership proceedings or
otherwise, and (iv)in any workout or restructuring or in connection
with the protection, preservation, exercise or enforcement of any of
the terms hereof or of any rights hereunder or under any other Loan
Document or in connection with any foreclosure, collection or
bankruptcy proceedings, and (b) all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever which may be imposed
on, incurred by or asserted against the Agent, in its capacity as
such, in any way relating to or arising out of this Agreement or any
other Loan Documents or any action taken or omitted by the Agent
hereunder or thereunder, provided that the Borrower shall not be
liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements if the same results from the Agent's gross negligence or
willful misconduct, or if the Borrower was not given notice of the
subject claim and the opportunity to participate in the defense
thereof, at its expense (except that the Borrower shall remain liable
to the extent such failure to give notice does not result in a loss to
the BOKOWH), or if the same results from a compromise or settlement
agreement entered into without the consent of the Borrower, which
shall not be unreasonably withheld. In addition, the Borrower agrees
to reimburse and pay all reasonable out-of-pocket expenses of the
Agent's regular employees
-58-
and agents engaged periodically to perform audits of the Loan
Parties'books, records and business properties.
10.6 Exculpatorv Provisions: Limitation of Liabilitv. Neither the Agent nor
any of its directors, officers, employees, agents, attorneys or
Affiliates shall (a)be liable to any Bank for any action taken or
omitted to be taken by it or them hereunder, or in connection herewith
including pursuant to any Loan Document, unless caused by its or their
own gross negligence or willful misconduct, (b)be responsible in any
manner to any of the Banks for the effectiveness, enforceability,
genuineness, validity or the due execution of this Agreement or any
other Loan Documents or for any recital, representation, warranty,
document, certificate, report or statement herein or made or furnished
under or in connection with this Agreement or any other Loan
Documents, or (c)be under any obligation to any of the Banks to
ascertain or to inquire as to the performance or observance of any of.
the terms, covenants or conditions hereof or thereof on the part of
the Loan Parties, or the financial condition of the Loan Parties, or
the existence or possible existence of any Event of Default or
Potential Default. No claim may be made by any of the Loan Parties,
any Bank, the Agent or any of their respective Subsidiaries against
the Agent, any Bank or any of their respective directors, officers,
employees, agents, attorneys or Affiliates, or any of them, for any
special, indirect or consequential damages or, to the fullest extent
permitted by Law, for any punitive damages in respect of any claim or
cause of action (whether based on contract, tort, statutory liability,
or any other ground)based on, arising out of or related to any Loan
Document or the transactions contemplated hereby or any act, omission
or event occurring in connection therewith, including the negotiation,
documentation, administration or collection of the Loans, and each of
the Loan Parties, (for itself and on behalf of each of its
Subsidiaries), the Agent and each Bank hereby waive, releases and
agree never to xxx upon any claim for any such damages, whether such
claim now exists or hereafter arises and whether or not it is now
known or suspected to exist in its favor. Each Bank agrees that,
except for notices, reports and other documents expressly required to
be furnished to the Banks by the Agent hereunder or given to the Agent
for the account of or with copies for the Banks, the Agent and each of
its directors, officers, employees, agents, attorneys or Affiliates
shall not have any duty or responsibility to provide any Bank with an
credit or other information concerning the business, operations,
property, condition (financial or otherwise), prospects or
creditworthiness of the Loan Parties which may come into the
possession of the Agent or any of its directors, officers, employees,
agents, attorneys or Affiliates.
10.7 Reimbursement and Indemnification of Apent bv Banks. Each Bank agrees
to reimburse and indemnify the Agent (to the extent not reimbursed by
the Borrower and without limiting the Obligation of the Borrower to do
so)in proportion to its Ratable Share from and against all
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements, including
reasonable attorneys'fees and disbursements (including the allocated
costs of staff counsel), and costs of appraisers and environmental
consultants, of any kind or nature whatsoever which may be imposed on,
incurred by or asserted against the
-59-
Agent, in its capacity as such, in any way relating to or arising out
of this Agreement or any other Loan Documents or any action taken or
omitted by the Agent hereunder or thereunder, provided that no Bank
shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses
or disbursements (a)if the same results from the Agent's gross
negligence or willful misconduct, or (b)if such Bank was not given
notice of the subject claim and the opportunity to participate in the
defense thereof, at its expense (except that such Bank shall remain
liable to the extent such failure to give notice does not result in a
loss to the Bank), or (c)if the same results from a compromise and
settlement agreement entered into without the consent of such Bank,
which shall not be unreasonably withheld. In addition, each Bank
agrees promptly upon demand to reimburse the Agent (to the extent not
reimbursed by the Borrower and without limiting the Obligation of the
Borrower to do so)in proportion to its Ratable Share for all amounts
due and payable by the Borrower to the Agent in connection with the
Agent's periodic audit of the Loan Parties'books, records and business
properties.
10.8 Reliance bv Apent. The Agent shall be entitled to rely upon any
writing, telegram, telex or teletype message, resolution, notice,
consent, certificate, letter, cablegram, statement, order or other
document or conversation by telephone or otherwise believed by it to
be genuine and correct and to have been signed, sent or made by the
proper Person or Persons, and upon the advice and opinions of counsel
and other professional advisers selected by the Agent. The Agent shall
be fully justified in failing or refusing to take any action
hereunder. unless 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.
10.9 Notice of Default. The Agent shall not be deemed to have knowledge or
notice of the occurrence of any Potential Default or Event of Default
unless the Agent has received written notice from a Bank or the
Borrower referring to this Agreement, describing such Potential
Default or Event of Default and stating that such notice is a "notice
of default."
10.10 Notices. The Agent shall promptly send to each Bank a copy of all
notices received from the Borrower pursuant to the provisions of this
Agreement or the other Loan Documents promptly upon receipt thereof.
The Agent shall promptly notify the Borrower and the other Banks of
each change in the Base Rate and the effective date thereof.
10.11 Banks in Their Individual Capacities. With respect to its Revolving
Credit Commitment, the Revolving Credit Loans, the Term Loan
Commitment and the Term Loans made by it and any other rights and
powers given to it as a Bank hereunder or under any of the other Loan
Documents, the Agent shall have the same rights and powers hereunder
as any other Bank and may exercise the same as though it were not the
Agent, and the term "Banks" shall, unless the context otherwise
indicates, include the Agent in its individual capacity. PNC Bank and
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its Affiliates and each of the Banks and their respective Affiliates
may, without liability to account, except as prohibited herein, make
loans to, accept deposits from, discount drafts for, act as trustee
under indentures of, and generally engage in any kind of banking or
trust business with, the Loan Parties and their Affiliates, in the
case of the Agent, as though it were not acting as Agent hereunder and
in the case of each Bank, as though such Bank were not a Bank
hereunder. The Banks acknowledge that, pursuant to such activities,
the Agent or its Affiliates may (i)receive information regarding the
Loan Parties (including information that may be subject to
confidentiality obligations in favor of the Loan Parties)and
acknowledge that the Agent shall be under no obligation to provide
such information to them, and (ii)accept fees and other consideration
from the Loan Parties for services in connection with this Agreement
and otherwise without having to account for the same to the Banks.
10.12 Holders of Notes. The Agent may deem and treat any payee of any Note
as the owner thereof for all purposes hereof unless and until written
notice of the assignment or transfer thereof shall have been filed
with the Agent. Any request, authority or consent of any Person who at
the time of making such request or giving such authority or consent is
the holder of any Note shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any Note
or Notes issued in exchange therefor.
10.13 Equalization of Banks. The Banks and the holders of any
participations in any Commitments or Loans or other rights or
obligations of a Bank hereunder agree among themselves that, with
respect to all amounts received by any Bank or any such holder for
application on any Obligation hereunder or under any such
participation, whether received by voluntary payment, by realization
upon security, by the exercise of the right of set-off or banker's
lien, by counterclaim or by any other non-pro rata source, equitable
adjustment will be made in the manner stated in the following sentence
so that, in effect, all such excess amounts will be shared ratably
among the Banks and such holders in proportion to their interests in
payments on the Loans, except as otherwise provided in Section
4.3.3,=or 5.7. The Banks or any such holder receiving any such amount
shall purchase for cash from each of the other Banks an interest in
such Bank's Loans in such amount as shall result in a ratable
participation by the Banks and each such holder 'in the aggregate
unpaid amount of the Loans, provided that if all or any portion of
such excess amount is thereafter recovered from the Bank or the holder
making such purchase, such purchase shall be rescinded and the
purchase price restored to the extent of such recovery, together with
interest or other amounts, if any, required by law (including court
order)to be paid by the Bank or the holder making such purchase.
10.14 Successor Apent. The Agent (i)may resign as Agent or (ii)shall resign
if such resignation is requested by the Required Banks (if the Agent
is a Bank, the Agent's Loans and its Commitment shall be considered in
determining whether the Required Banks have requested such
resignation)or required by Section 5.5.2, in either case of (i)or
(ii)by giving not less than thirty (30)days'prior written
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notice to the Borrower. If the Agent shall resign under this
Agreement, then either (a)the Required Banks shall appoint from among
the Banks a successor agent for the Banks, subject to the consent of
the Borrower, such consent not to be unreasonably withheld, or (b)if a
successor agent shall not be so appointed and approved within the
thirty (30)day period following the Agent's notice to the Banks of its
resignation, then the Agent shall appoint, with the consent of the
Borrower, such consent not to be unreasonably withheld, a successor
agent who shall serve as Agent until such time as the Required Banks
appoint and the Borrower consents to the appointment of a successor
agent. Upon its appointment pursuant to either clause (a)or (b)above,
such successor agent shall succeed to the rights, powers and duties of
the Agent, and the term "Agent" shall mean such successor agent,
effective upon its appointment, and the former Agent's rights, powers
and duties as Agent shall be terminated without any other or further
act or deed on the part of such former Agent or any of the parties to
this Agreement. After the resignation of any Agent hereunder, the
provisions of this Section 10 shall inure to the benefit of such
former Agent and such former Agent shall not by reason of such
resignation be. deemed to be released from liability for any actions
taken or not taken by it while it was an Agent under this Agreement.
10.15 Renewal Fee. The Borrower shall pay to the Agent a nonrefundable fee
of $10,000 (the "Renewal Fee")for the extension and renewal of the
Revolving Credit Loans and the Term Loans. Such Renewal Fee will be
shared ratably among the Banks in proportion to their Ratable Share.
10.16 Availabilitv of Funds. The Agent may assume that each Bank has made
or will make the proceeds of a Loan available to the unless the Agent
shall have been notified by such Bank on or before the later of (1)the
close of Business on the Business Day preceding the Borrowing Date
with respect to such Loan or two (2) hours before the time on which
the Agent actually funds the proceeds of such Loan to the Borrower
(whether using its own funds pursuant to this Section 10.16 or using
proceeds deposited with the Agent by the Banks and whether such
funding occurs before or after the time on which Banks are required to
deposit the proceeds of such Loan with the Agent). The Agent may, in
reliance upon such assumption (but shall not be required to), make
available to the Borrower a corresponding amount in the applicable
currency. If such corresponding amount is not in fact made available
to the Agent by such Bank in the applicable currency, the Agent shall
be entitled to recover such amount on demand Xxx such Bank (or, if
such Bank fails to pay such amount forthwith upon such demand from the
Borrower)together with interest thereon, in respect of each day during
the period commencing on the date such amount was made available to
the Borrower and ending on the date the Agent recovers such amount, at
a rate per annum equal to (i)the Federal Funds Effective Rate during
the first three (3)days after such interest shall begin to accrue and
(ii)the applicable interest rate in respect of such Loan after the end
of such three-day period.
10.17 Calculations. In the absence of gross negligence or willful
misconduct, the Agent shall not be liable for any error in computing
the amount payable to any
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Bank whether in respect of the Loans, fees or any other amounts due to
the Banks under this Agreement. In the event an error in computing any
amount payable to any Bank is made, the Agent, the Borrower and each
affected Bank shall, forthwith upon discovery of such error, make such
adjustments as shall be required to correct such error, and any
compensation therefor will be calculated at the Federal Funds
Effective Rate.
10.18 Beneficiaries. Except as expressly provided herein, the provisions of
this Section _@are solely for the benefit of the Agent and the Banks,
and the Loan Parties shall not have any rights to rely on or enforce
any of the provisions hereof. In performing its fin&ions and duties
under this Agreement, the Agent shall act solely as agent of the Banks
and does not assume and shall not be deemed to have assumed any
obligation toward or relationship of agency or trust with or for any
of the Loan Parties.
10.19 Collateral Examination Reports. Upon the request of a Bank, Agent
shall provide to such Bank copies of any reports or other information
generated from the Agent's examination of Borrower's properties or
Collateral under Section 8.1.6.
11. MISCELLANEOUS.
11.1 Modifications, Amendments or Waivers. With the written consent of the
Required Banks, the Agent, acting on behalf of all the Banks, and the
Borrower, on behalf of the Loan Parties, may f? om time to time enter
into written agreements amending or changing any provision of this
Agreement or any other Loan Document or the rights of the Banks or the
Loan Parties hereunder or thereunder, or may grant written waivers or
consents to a departure Xxx the due performance of the Obligations of
the Loan Parties hereunder or thereunder. Any such agreement, waiver
or consent made with such written consent shall be effective to bind
all the Banks and the Loan Parties; provided, that, without the
written consent of all the Banks, no such agreement, waiver or consent
may be made which will:
11.1.1 Increase of Commitment; Extension or Expiration Date. Increase
the amount of the Revolving Credit Commitment or Term Loan
Commitment of any Bank hereunder or extend the Expiration Date;
11.1.2 Extension of Payment: Reduction of Principal Interest or Fees;
Modification of Terms of Pavment. Whether or not any Loans are
outstanding, extend the time for payment of principal or interest
of any Loan (excluding the due date of any mandatory prepayment
of a Loan or any mandatory Commitment reduction in connection
with such a mandatory prepayment hereunder except for mandatory
reductions of the Commitments on the Expiration Date)or any other
fee payable to any Bank, or reduce the principal amount of or the
rate of interest borne by any Loan or reduce any other fee
payable to any Bank, or otherwise affect
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the terms of payment of the principal of or interest of any Loan
or any other fee payable to any Bank;
11.1.3 Release of Collateral or Guarantor. Except for sales of assets
permitted by Section 8.2.7, release any Collateral consisting of
capital stock or other ownership interests of any Loan Party or
its Subsidiary or substantially all of the assets of any Loan
Party, any Guarantor from its Obligations under the .Guaranty
Agreement or any other security for any of the Loan Parties'
Obligations; or
11.1.4 Miscellaneous. Amend Section 5.2 9; 10 6 or 10 A 13 or this
Section 11.1, alter any provision regarding the pro rata
treatment of the Banks, change the definition of Required Banks,
or change any requirement providing for the Banks or the Required
Banks to authorize the taking of any action hereunder;
provided, further, that no agreement, waiver or consent which
would modify the interests, rights or obligations of the Agent in
its capacity as Agent shall be effective without the written
consent of the Agent.
11.2 No Implied Waivers: Cumulative Remedies: Writing Required. No course
of dealing and no delay or failure of the Agent or any Bank in
exercising any right, power, remedy or privilege under this Agreement
or any other Loan Document shall affect any other or future exercise
thereof or operate as a waiver thereof, nor shall any single or
partial exercise thereof or any abandonment or discontinuance of steps
to enforce such a right, power, remedy or privilege preclude any
further exercise thereof or of any other right, power, remedy or
privilege. The rights and remedies of the Agent and the Banks under
this Agreement and any other Loan Documents are cumulative and not
exclusive of any rights or remedies that they would otherwise have.
Any waiver, permit, consent or approval of any kind or character on
the part of any Bank of any breach or default under this Agreement or
any such waiver of any provision or condition of this Agreement must
be in writing and shall be effective only to the extent specifically
set forth in such writing.
11.3 Reimbursement and Indemnification of Banks bv the Borrower: Taxes. The
Borrower agrees unconditionally upon demand to pay or reimburse to
each Bank (other than the Agent, as to which the Borrower's
Obligations are set form in Section 10.5)and to save such Bank
harmless against (i)liability for the payment of all reasonable
out-of-pocket costs, expenses and disbursements (including reasonable
fees and expenses of counsel (including allocated costs of staff
counsel)for each Bank except with respect to (a)and (b)below),
incurred by such Bank (a)in connection with the administration and
interpretation of this Agreement, and other instruments and documents
to be delivered hereunder, (b) elating to any amendments, waivers or
consents pursuant to the provisions hereof, (c)in connection with the
enforcement of this Agreement or any other Loan Document, or
collection of amounts due hereunder or thereunder or the proof and
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allowability of any claim arising under this Agreement or any other
Loan Document, whether in bankruptcy or receivership proceedings or
otherwise, and (d)in any workout or restructuring or in connection
with the protection, preservation, exercise or enforcement of any of
the terms hereof or of any rights hereunder or under any other Loan
Document or in connection with any foreclosure, collection or
bankruptcy proceedings, or (ii)all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever which may be imposed
on, incurred by or asserted against such Bank, in its capacity as
such, in any way relating to or arising out of this Agreement or any
other Loan Documents or any action taken or omitted by such Bank
hereunder or thereunder, provided that the Borrower shall not be
liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements (A)if the same results from such Bank's gross negligence
or willful misconduct, or (B)if the Borrower was not given notice of
the subject claim and the opportunity to participate in the defense
thereof, at its expense (except that the Borrower shall remain liable
to the extent such failure to give notice does not result in a loss to
the Borrower), or (C)if the same results fi-om a compromise or
settlement agreement entered into without the consent of the Borrower,
which shall not be unreasonably withheld. The Banks will attempt to
minimize the fees and expenses of legal counsel for the Banks which
are subject to reimbursement by the Borrower hereunder by considering
the usage of one law firm to represent the Banks and the Agent if
appropriate under the circumstances. The Borrower agrees
unconditionally to pay all stamp, document, transfer, recording or
filing taxes or fees and similar impositions now or hereafter
determined by the Agent or any Bank to be payable in connection with
this Agreement or any other Loan Document, and the Borrower agrees
unconditionally to save the Agent and the Banks harmless from and
against any and all present or future claims, liabilities or losses
with respect to or resulting from any omission to pay or delay in
paying any such taxes, fees or impositions.
11.4 Holidavs. Whenever payment of a Loan to be made or taken hereunder
shall be due on a day which is not a Business Day such payment shall
be due on the next Business Day and such extension of time shall be
included in computing interest and fees, except that the Loans shall
be due on the Business Day preceding the Expiration Date if the
Expiration Date is not a Business Day. Whenever any payment or action
to be made or taken hereunder (other than payment of the Loans)shall
be stated to be due on a day which is not a Business Day, such payment
or action shall be made or taken on the next following Business Day,
and such extension of time shall not be included in computing interest
or fees, if any, in connection with such payment or action.
11.5 Funding bv Branch, Subsidiary or Affiliate.
11.5.1 Notional Funding. Each Bank shall have the right from time to
time, without notice to the Borrower, to deem any branch,
Subsidiary or Affiliate (which for the purposes of this Section
11.5 shall mean any
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corporation or association which is directly or indirectly
controlled by or is under direct or indirect common control with
any corporation or association which directly or indirectly
controls such Bank)of such Bank to have made, maintained or
funded any Loan to which the Euro-Rate applies at any time,
provided that immediately following (on the assumption that a
payment were then due from the Borrower to such other office),
and as a result of such change, the Borrower would not be under
any greater financial obligation pursuant to Section 5.7 than it
would have been in the absence of such change. Notional funding
offices may be selected by each Bank without regard to such
Bank's actual methods of making, maintaining or funding the Loans
or any sources of funding actually used by or available to such
Bank.
11.5.2 Actual Funding. Each Bank shall have the right from time to
time to make or maintain any Loan by ~arranging for a branch,
Subsidiary or Affiliate of such Bank to make or maintain such
Loan subject to the last sentence of this Section 11.5.2. If any
Bank causes a branch, Subsidiary or Affiliate to make or maintain
any part of the Loans hereunder, all terms and conditions of this
Agreement shall, except where the context clearly requires
otherwise, be applicable to such part of the Loans to the same
extent as if such Loans were made or maintained by such Bank, but
in no event shall any Bank's use of such a branch, Subsidiary or
Affiliate to make or maintain any part of the Loans hereunder
cause such Bank or such branch, Subsidiary or Affiliate to incur
any cost or expenses payable by the Borrower hereunder or require
the Borrower to pay any other compensation to any Bank (including
any expenses incurred or payable pursuant to Section which would
otherwise not be incurred.
11.6 Notices: Lending Offices. Any notice, request, demand, directions and
other communication (for purposes of this Section 11.6 only,
"Notice")to be given to or made upon any party hereto under the
provisions of this Agreement shall be given or made by telephone or
.in writing (which includes means of electronic transmission (i. e.,
"e-mail"))or facsimile transmission or by setting form such Notice on
a site on the World Wide Web (a "Website Posting")if Notice of such
Website Posting (including the information necessary to access such
site)has previously been delivered to the applicable parties hereto by
another means set forth in this Section 11.6)in accordance with this
Section 11.6. Any such Notice must be delivered to the applicable
parties hereto at the addresses and numbers set forth under their
respective names on Schedule 1.1(B)hereof or in accordance with any
subsequent unrevoked Notice from any such party that is given in
accordance with Section 11.6. Any Notice shall be effective:
11.6.1 In the case of hand-delivery, when delivered;
11.6.2 If given by mail, four days after such Notice is deposited with
the United States Postal Service, with first-class postage
prepaid, return receipt requested;
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11.6.3 In the case of a telephonic Notice, when a party is contacted
by telephone, if delivery of such telephonic Notice is confirmed
no later than the next Business Day by hand delivery, a facsimile
or electronic transmission, a Website Posting or an overnight
courier delivery of a confirmatory Notice (received at or before
noon on such next Business Day);
11.6.4 In the case of a facsimile transmission, when sent to the
applicable party's facsimile machine's telephone number, if the
party sending such Notice receives confirmation of the delivery
thereof from its own facsimile machine;
11.6.5 In the case of electronic transmission, when actually received;
11.6.6 In the case of a Website Posting, upon delivery of a Notice of
such posting (including the information necessary to access such
site)by another means as'set forth in this Section 11.6; and
11.6.7 If given by any other means (including by overnight courier),
when actually received.
Any Lender giving a Notice to a Loan Party shall concurrently send a
copy thereof to the Agent, and the Agent shall promptly notify the
other Lenders of its receipt of such Notice. Schedule 1.1(B)lists the
Lending Offices of each Bank. Each Bank may change its Lending Office
by written notice to the other parties hereto.
11.7 Severability. The provisions of this Agreement are intended to be
severable. If any provision of this Agreement shall be held invalid or
unenforceable in whole or in part in any jurisdiction, such provision
shall, as to such jurisdiction, be ineffective to the extent of such
invalidity or unenforceability without in any manner affecting the
validity or enforceability thereof in any other jurisdiction or the
remaining provisions hereof in any jurisdiction.
11.8 Prior Understanding. This Agreement and the other Loan Documents
supersede all prior understandings and agreements, whether written or
oral, between the parties hereto and thereto relating to the
transactions provided for herein and therein, including any prior
confidentiality agreements and commitments.
11.9 Duration; Survival. All representations and warranties of the Loan
Parties contained herein or made in connection herewith shall survive
the making of Loans and issuance of Letters of Credit and shall not be
waived by the execution and delivery of this Agreement, any
investigation by the Agent or the Banks, the making of Loans, or
payment in full of the Loans. All covenants and agreements of the Loan
Parties contained in Sections 8.1, u and 8.3 herein shall continue in
full force and effect from and after the date hereof so long as the
Borrower may borrow hereunder and until termination of the Commitments
and payment in full of the Loans. All covenants and agreements of the
Borrower contained herein relating to the payment of principal,
interest, premiums, additional .compensation
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or expenses and indemnification, including those set forth in Section
5 and Sections 10.5, 10.7 and 11.3, shall survive payment in full of
the Loans and termination of the Commitments.
11.10 Successors and Assigns.
11.lO.l This Agreement shall be binding upon and shall inure to the
benefit of the Banks, the Agent, the Loan Parties and their
respective successors and assigns, except that none of the Loan
Parties may assign or transfer any of its rights and Obligations
hereunder or any interest herein. Each Bank may, at its own cost,
make assignments of or sell participations in all or any part of
its Revolving Credit Commitments and the Loans made by it to one
or more banks or other entities, subject to the consent of the
Borrower and the Agent with respect to any assignee, such consent
not to be unreasonably withheld, provided that (1)no consent of
the Borrower shall be required (A)if an Event of Default exists
and is continuing, or (B)in the case of an assignment by a Bank
to an Affiliate of such Bank, (2)any assignment by a Bank to a
Person other than an Affiliate of such Bank may not be made in
amounts less than the lesser of $2,000,000 or the amount of the
assigning Bank's Commitment, and (3)a Bank may assign an interest
or sell a participation in less than 100%of its Commitments,
Loans, provided that such Bank sells an equal percentage interest
or participation in each of its Revolving Credit Commitment, Term
Loan commitment, Revolving Credit Loans and Term Loans. In the
case of an assignment, upon receipt by the Agent of the
Assignment and Assumption Agreement, the assignee shall have, to
the extent of such assignment (unless otherwise provided
therein), the same rights, benefits and obligations as it would
have if it had been a signatory Bank hereunder, the Commitments
shall be adjusted accordingly, and upon surrender of any
Revolving Credit Note or Term Note subject to such assignment,
the Borrower shall execute and deliver a new Revolving Credit
Note or Term Note to the assignee, if such assignee request such
a Note in an amount equal to the amount of the Revolving Credit
Commitment or Term Loan assumed by it and a new Revolving Credit
Note or Term Note to the assigning Bank, if the assigning Bank
requests such a Note, in an amount equal to the Revolving Credit
Commitment or Term Loan retained by it hereunder. Any Bank which
assigns any or all of its Commitment or Loans to a Person other
than an Affiliate of such Bank shall pay to the Agent a service
fee in the amount of $2,000.00 for each assignment. In the case
of a participation, the participant shall only have the rights
specified in Section 9.2.3 (the participant's rights against such
Bank in respect of such participation to be those set forth in
the agreement executed by such Bank in favor of the participant
relating thereto and not to include any voting rights except with
respect to changes of the type referenced in Sections 11.1.1,
11.1.2, or 11.1.3, all of such Bank's obligations under this
Agreement or any other Loan Document shall remain unchanged, and
all amounts payable by any Loan Party hereunder
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or thereunder shall be determined as if such Bank had not sold
such participation.
ll.lO.2 Any assignee or participant which is not incorporated under
the Laws of the United States of America or a state thereof shall
deliver to the Borrower and the Agent the form of certificate
described in Section 11.17 relating to federal income tax
withholding. Each Bank may furnish any publicly available
information concerning any Loan Party or its Subsidiaries and any
other information concerning any Loan Party or its Subsidiaries
in the possession of such Bank from time to time to assignees and
participants (including prospective assignees or participants),
provided that such assignees and participants agree to be bound
by the provisions of Section 11.12.
11.10.3 Notwithstanding any other provision in this Agreement, any
Bank may at any time pledge or grant a security interest in all
or any portion of its rights under this Agreement, its Note if
any and the other Loan Documents to any Federal Reserve Bank in
accordance with Regulation A of the FRB or U. S. Treasury
Regulation 3 1 CFR Section 203.14 without notice to or consent of
the Borrower or the Agent. No such pledge or gram of a security
interest shall release the transferor Bank of its obligations
hereunder or under any other Loan Document.
11.11 Confidentiality.
ll.ll.l General. The Agent and the Banks each agree to keep
confidential all information obtained from any Loan Party or its
Subsidiaries which is nonpublic and confidential or proprietary
in nature (including any information the Borrower specifically
designates as confidential), except as provided below, and to use
such information only in connection with their respective
capacities under this Agreement and for the purposes contemplated
hereby. The Agent and the Banks shall be permitted to disclose
such information (i)to outside legal counsel, accountants and
other professional advisors who need to know such information in
connection with the administration and enforcement of this
Agreement, subject to agreement of such Persons to maintain the
confidentiality, (ii)to assignees and participants as
contemplated by Xxxxxxx 00 .x 0, (xxx)xx the extent requested by
any bank regulatory authority or, with notice to the Borrower, as
otherwise required by applicable Law or by any subpoena or
similar legal process, or in connection with any investigation or
proceeding arising out of the transactions contemplated by this
Agreement, (iv)if it becomes publicly available other than as a
result of a breach of this Agreement or becomes available from a
source not known to be subject to confidentiality restrictions,
or (v)if the Borrower shall have consented to such disclosure.
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11.11.2 Sharinp Information With Affiliates of the Banks. Each Loan
Party acknowledges that from time to time financial advisory,
investment banking and other services may be offered or provided
to the Borrower or one or more of its Affiliates (in connection
with this Agreement or otherwise)by any Bank or by one or more
Subsidiaries or Affiliates of such Bank and each of the Loan
Parties hereby authorizes each Bank to share any information
delivered to such Bank by such Loan Party and its Subsidiaries
pursuant to this Agreement, or in connection with the decision of
such Bank to enter into this Agreement, to any such Subsidiary or
Affiliate of such Bank, it being understood that any such
Subsidiary or affiliate of any Bank receiving such information
shall be bound by the provisions of Section 11.12.1 Such'as if it
were a Bank hereunder. Authorization shall survive the repayment
of the Loans and other Obligations and the termmation of the
Commitments.
11.12 Counterparts. This Agreement may be executed by different parties
hereto on any number of separate counterparts, each of which, when so
executed and delivered, shall be an original, and all such
counterparts shall together constitute one and the same instrument.
11.13 APent's or Bank's Consent. Whenever the Agent's or any Bank's consent
is required to be obtained under this Agreement or any of the other
Loan Documents as a condition to any action, inaction, condition or
event, the Agent and each Bank shall be authorized to give or withhold
such consent in its sole and absolute discretion and to condition its
consent upon the giving of additional collateral, the payment of money
or any other matter.
11.14 Exceptions. The representations, warranties and covenants contained
herein shall be independent of each other, and no exception to any
representation, warramy or covenant shall be deemed to be an exception
to any other representation, warranty or covenant contained herein
unless expressly provided, nor shall any such exceptions be deemed to
pemrit any action or omission that would be in contravention of
applicable Law.
11.15 CONSENT TO FORUM; WAIVER OF JURY TRIAL. EACH LOAN PARTY HEREBY
IRREVOCABLY CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF THE COURT OF
COMMON PLEAS OF XXXXXXXX COUNTY AND THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF OHIO, AND WAIVES PERSONAL SERVICE OF ANY
AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS
BE MADE BY CERTIFIED OR REGISTERED MAIL DIRECTED TO SUCH LOAN PARTY AT
THE ADDRESSES PROVIDED FOR IN SECTION 11.6 AND SERVICE SO MADE SHALL
BE DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT THEREOF. EACH LOAN PARTY
WAIVES ANY OBJECTION TO JURISDICTION AND VENUE OF ANY ACTION
INSTITUTED ,4GAINST IT AS PROVIDED HEREIN AND AGREES NOT TO ASSERT ANY
DEFENSE BASED ON LACK OF
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JURISDICTION OR VENUE. EACH LOAN PARTY, THE AGENT AND THE BANKS HEREBY
WAIVE TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM OF
ANY KIND ARISING OUT OF OR RELATED TO THIS AGREEMENT, ANY OTHER LOAN
DOCUMENT OR THE COLLATERAL TO THE FULL EXTENT PERMITTED BY LAW.
11.16Tax Withholdinp Clause. Each Bank or assignee or participant of a Bank
that is not incorporated under the Laws of the United States of
America or a state thereof agrees that it will deliver to each of the
Borrower and the Agent two (2)duly completed copies of the following:
(i)Internal Revenue Service Form W-9,4224 or 1001, or other applicable
form prescribed by the Internal Revenue Service, certifying that such
Bank, assignee or participant is entitled to receive payments under
this Agreement and the other Loan Documents without deduction or
withholding of any United States federal income taxes, or is subject
to such tax at a reduced rate under an applicable tax treaty,
or.(ii)Internal Revenue Service Form W-8 or other applicable form or a
certificate of such Bank, assignee or participant indicating that no
such exemption or reduced rate is allowable with respect to such
payments. Each Bank, assignee or participani required to deliver to
the Borrower and the Agent a form or certificate pursuant to the
preceding sentence shall deliver such form or certificate as follows:
(A)each Bank which is a party hereto on the Closing Date shall deliver
such form or certificate at least five (5)Business Days prior to the
first date on which any interest or fees are payable by the Borrower
hereunder for the account of such Bank; (B)each assignee or
participant shall deliver such form or certificate at least five (5)
Business Days before the effective date of such assignment or
-pa&cipation (unless the Agent in its sole discretion shall permit
such assignee or participant to deliver such form or certificate less
than five (5)Business Days before such date in which case it shall be
due on the date specified by the Agent). Each Bank, assignee or
participant which so delivers a Form W-8, W-9,4224 or 1001 fkther
undertakes to deliver to each of the Borrower and the Agent two
(2)additional copies of such form (or a successor form)on or before
the date that such form expires or becomes obsolete or after the
occurrence of any event requiring a change in the most recent form so
delivered by it, and such amendments thereto or extensions or renewals
thereof as may be reasonably requested by the BOKOW~~ or the Agent,
either certifying that such Bank, assignee or participant is entitled
to receive payments under this Agreement and the other Loan Documents
without deduction or withholding of any United States federal income
taxes or is subject to such tax at a reduced rate under an applicable
tax treaty or stating that no such exemption or reduced rate is
allowable. The Agent shall be entitled to withhold United States
federal income taxes at the full withholding rate unless the Bank,
assignee or participant establishes an exemption or that it is subject
to a reduced rate as established pursuant to the above provisions.
11.17Joinder of Guarantors. Any Subsidiary of the Borrower which is
required to join this Agreement as a Guarantor pursuant to Section
8.2.8 shall execute and deliver to the Agent (i)a Guarantor Joinder in
substantially the form attached hereto as Exhibit 1.1(G)(l)pursuant to
which it shall join as a Guarantor each of
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the documents to which the Guarantors are parties; and (ii)documents
in the forms described in Section 7.1 modified as appropriate to
relate to such Subsidiary. The Loan Parties shall deliver such
Guarantor Joinder and related documents to the Agent within five
(5)Business Days after the date of the filing of such Subsidiary's
articles of incorporation if the Subsidiary is a corporation, the date
of the filing of its certificate of limited partnership if it is a
limited partnership or the date of its organization if it is an entity
other than a limited partnership or corporation.
(remainder ofpage left intentionally blank)
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IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly
authorized, have executed this Agreement as of the day and year first above
written.
BORROWER:
XXXXXXXXX FOODS VENTURE, L. P.
By: G/W Foods, Inc., a Texas corporation,
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------
Xxxxxx X. Xxxxxxxxx
President
GUARANTOR:
XXXXXXXXX PARTNERS, L. P.
By:_________________________________
Name:_______________________________
Title:______________________________
BANKS:
PNC BANK, NATIONAL ASSOCIATION,
individually and as Agent
By: /s/Xxxxxxx Xxxxx
--------------------
Xxxxxxx Xxxxx
Title: Vice President
FIFTH THIRD BANK, WESTERN OHIO
By: /s/Xxxxx Xxxxx
--------------------
Xxxxx Xxxxx
Title: Vice President
limited partnership or the date of its organization if it is an entity
other than a limited partnership or corporation.
WITNESS WHEREOF, the partics thereto, by their officers thereunto duly
authorized, have executed this Agreement as of the day and year first above
written.
BORROWER:
XXXXXXXXX FOODS VENTURE, L. P.
By:_________________________________
Title:______________________________
GUARANTOR:
XXXXXXXXX PARTNERS, L. P.
By: Xxxxxx _______, President Xxxxx X. Xxxxxx
General Partner of Xxxxxxxxx Partners LP
Title:______________________________
PNC BANK, NATIONAL ASSOCIATION,
individually and as Agent
By:_________________________________
Title:______________________________
FIFTH THIRD BANK OF
WESTERN OHIO, N.A.
By:_________________________________
Title:______________________________
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