1
EXHIBIT 4.8(a)
[EXECUTION COPY]
U.S. $100,000,000
TERM LOAN AGREEMENT,
dated as of October 30, 1997,
among
PIONEER AMERICAS, INC.,
as the Borrower
PIONEER AMERICAS ACQUISITION CORP.,
as the Parent Guarantor,
VARIOUS FINANCIAL INSTITUTIONS,
as the Lenders,
DLJ CAPITAL FUNDING, INC.,
as the Syndication Agent for the Lenders,
SALOMON BROTHERS HOLDING COMPANY INC,
as the Documentation Agent for the Lenders,
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as the Administrative Agent for the Lenders,
and
UNITED STATES TRUST COMPANY OF NEW YORK,
as the Collateral Agent for the Lenders,
ARRANGED BY
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES CORPORATION
2
TABLE OF CONTENTS
SECTION PAGE
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ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2. Use of Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
1.3. Cross-References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
1.4. Accounting and Financial Determinations . . . . . . . . . . . . . . . . . . . . . . . . . 29
1.5. Use of UCC Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
1.6. Officers' Certificates and Opinions . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
ARTICLE II
COMMITMENTS, BORROWING PROCEDURES AND NOTES
2.1. Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
2.1.1. Term Loan Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
2.1.2. Lenders Not Permitted or Required to Make the Term Loans . . . . . . . . . . . . . . . . 30
2.2. Borrowing Procedures and Funding Maintenance . . . . . . . . . . . . . . . . . . . . . . 31
2.3. Continuation and Conversion Elections . . . . . . . . . . . . . . . . . . . . . . . . . . 31
2.4. Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
2.5. Term Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
3.1. Repayments and Prepayments; Application . . . . . . . . . . . . . . . . . . . . . . . . . 32
3.1.1. Repayments and Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
3.1.2. Application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
3.2. Interest Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
3.2.1. Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
3.2.2. Post-Maturity Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
3.2.3. Payment Dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
3.3. Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
3.3.1. Arrangement, Structuring and Commitment Fees . . . . . . . . . . . . . . . . . . . . . . 35
3.3.2. Administrative Agent Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 00
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XXXXXXX XX
XXXXXXX XXXX RATE AND OTHER PROVISIONS
4.1. LIBO Rate Lending Unlawful . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
4.2. Deposits Unavailable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
4.3. Increased LIBO Rate Loan Costs, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . 36
4.4. Funding Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
4.5. Increased Capital Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
4.6. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
4.7. Payments, Computations, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
4.8. Sharing of Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
4.9. Setoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE V
CONDITIONS TO TERM LOAN EXTENSION
5.1. Resolutions, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
5.2. Delivery of Term Notes and the Bond. . . . . . . . . . . . . . . . . . . . . . . . . . . 40
5.3. Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
5.4. Consummation of Acquisition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
5.5. Issuance of the Senior Secured Notes . . . . . . . . . . . . . . . . . . . . . . . . . . 40
5.6. Revolving Credit Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
5.7. Transaction Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
5.8. Canadian Demand Debenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
5.9. Security Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
5.10. Quebec Mortgage and Security Agreement . . . . . . . . . . . . . . . . . . . . . . . . . 43
5.11. Closing Date Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
5.12. Financial Information, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
5.13. Pro Forma Balance Sheet Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
5.14. Target Business Financial Information . . . . . . . . . . . . . . . . . . . . . . . . . . 44
5.15. Indebtedness Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
5.16. Intercreditor Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
5.17. Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
5.18. Material Adverse Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
5.19. Consents and Approvals, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
5.20. Reliance Letters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
5.21. Opinions of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
5.22. Closing Fees, Expenses, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
5.23. Satisfactory Legal Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
5.24. Compliance with Warranties, No Default, etc. . . . . . . . . . . . . . . . . . . . . . . 46
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ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1. Organization, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
6.2. Due Authorization, Non-Contravention, etc. . . . . . . . . . . . . . . . . . . . . . . . 47
6.3. No Conflicts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
6.4. Validity and Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
6.5. No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
6.6. Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
6.7. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
6.8. Litigation; Contingent Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
6.9. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
6.10. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
6.11. Partnerships; Joint Ventures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
6.12. Senior Secured Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
6.13. Intellectual Property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
6.14. Solvency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
6.15. Contracts; Labor Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
6.16. Pension and Welfare Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
6.17. Regulations G, U and X . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
6.18. Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
6.19. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
6.20. Investment Company Act Representation . . . . . . . . . . . . . . . . . . . . . . . . . . 51
6.21. Public Utility Holding Company Act Representation . . . . . . . . . . . . . . . . . . . . 51
6.22. Environmental and Safety and Health Matters . . . . . . . . . . . . . . . . . . . . . . . 51
6.23. Related Agreements and Transaction Documents . . . . . . . . . . . . . . . . . . . . . . 52
6.24. Holding Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
6.25. PCICC, PCI Carolina and Pioneer Licensing . . . . . . . . . . . . . . . . . . . . . . . . 53
ARTICLE VII
COVENANTS
7.1. Affirmative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
7.1.1. Financial Information, Reports, Notices, etc. . . . . . . . . . . . . . . . . . . . . . . 53
7.1.2. Corporate Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
7.1.3. Maintenance of Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
7.1.4. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
7.1.5. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
7.1.6. Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
7.1.7. Use of Proceeds, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
7.1.8. Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
7.1.9. Stock Pledge Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
7.1.10. Concerning the Collateral and the Loan Documents . . . . . . . . . . . . . . . . . . . . 57
7.1.11. Maintenance of Corporate Separateness . . . . . . . . . . . . . . . . . . . . . . . . . . 58
7.1.12. Working Capital Line . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
7.1.13. St. Xxxxxxx Pipeline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
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7.1.14. Pension Transfer Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
7.2. Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
7.2.1. Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
7.2.2. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
7.2.3. Restricted Payments, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
7.2.4. Payment Restrictions Affecting Guarantors . . . . . . . . . . . . . . . . . . . . . . . . 66
7.2.5. Consolidation, Merger, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
7.2.6. Asset Dispositions, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
7.2.7. Modification of Certain Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
7.2.8. Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
7.2.9. Impairment of Security Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
7.2.10. Stock of Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
7.2.11. Sale and Leaseback . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
7.2.12. Limitation on Applicability of Certain Covenants . . . . . . . . . . . . . . . . . . . . 74
ARTICLE VIII
EVENTS OF DEFAULT
8.1. Listing of Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
8.1.1. Non-Payment of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
8.1.2. Breach of Warranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
8.1.3. Non-Performance of Certain Covenants and Obligations . . . . . . . . . . . . . . . . . . 75
8.1.4. Non-Performance of Other Covenants and Obligations . . . . . . . . . . . . . . . . . . . 75
8.1.5. Disaffirmation of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
8.1.6. Effectiveness and Enforceability of Guarantees . . . . . . . . . . . . . . . . . . . . . 76
8.1.7. Default on Other Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
8.1.8. Judgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
8.1.9. Bankruptcy, Insolvency, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
8.1.10. Impairment of Security, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
8.2. Action if Bankruptcy, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
8.3. Action if Other Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
ARTICLE IX
GUARANTY
9.1. Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
9.2. Acceleration of Parent Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
9.3. Guaranty Absolute, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
9.4. Reinstatement, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
9.5. Waiver, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
9.6. Postponement of Subrogation, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
9.7. Successors, Transferees and Assigns; Transfers of Term Notes, etc. . . . . . . . . . . . 81
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ARTICLE X
THE AGENTS
10.1. Appointment of Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
10.2. Intercreditor Agreement and Collateral Agent; Power of Attorney . . . . . . . . . . . . . 82
10.3. Nature of Duties of the Agents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
10.4. General Immunity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
10.5. Successor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
10.6. Agents in their Capacity as Lenders. . . . . . . . . . . . . . . . . . . . . . . . . . . 84
10.7. Actions by Each Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
10.8. Right to Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
10.9. Suits to Protect Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
10.10. Determinations Relating to Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . 85
10.11. Trust Moneys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
10.12. Release of Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
10.13. Holding of Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
10.14. Application of Proceeds of Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . 87
10.15. Rights and Remedies to be Exercised by Administrative Agent Only . . . . . . . . . . . . 87
10.16. Credit Decisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
10.17. Copies, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
10.18. The Syndication Agent, the Documentation Agent and the Administrative Agent . . . . . . . 88
10.19. Agreement to Cooperate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
10.20. Lenders to Act as Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.1. Waivers, Amendments, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
11.2. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
11.3. Payment of Costs and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
11.4. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
11.5. Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
11.6. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
11.7. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
11.8. Execution in Counterparts, Effectiveness, etc. . . . . . . . . . . . . . . . . . . . . . 91
11.9. Governing Law; Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
11.10. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
11.11. Sale and Transfer of Term Loans and Term Notes; Participations in
Term Loans and Term Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
11.11.1. Assignments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
11.11.2. Participations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
11.12. Other Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
11.13. Forum Selection and Consent to Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . 94
11.14. Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
11.15. Judgment Currency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
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SCHEDULE I - Disclosure Schedule
SCHEDULE II - Percentages and Administrative Information
EXHIBIT A-1 - Form of Term Note
EXHIBIT A-2(a) - Form of Bond
EXHIBIT A-2(b) - Form of Bond Pledge Agreement
EXHIBIT B - Form of Borrowing Request
EXHIBIT C - Form of Continuation/Conversion Notice
EXHIBIT D-1 - Form of Affiliate Guaranty
EXHIBIT D-2 - Form of Canadian Subsidiary Guaranty
EXHIBIT E-1(a) - Form of Canadian Demand Debenture
EXHIBIT E-1(b) - Form of Canadian Demand Debenture Pledge Agreement
EXHIBIT E-2 - Form of Quebec Mortgage and Security Agreement
EXHIBIT F-1 - Form of Canadian Subsidiary Security Agreement
EXHIBIT F-2 - Form of Affiliate Security Agreement
EXHIBIT G-1 - Form of Borrower Closing Date Certificate
EXHIBIT G-2 - Form of Parent Guarantor Closing Date Certificate
EXHIBIT G-3 - Form of PCI Closing Date Certificate
EXHIBIT H - Form of Lender Assignment Agreement
EXHIBIT I - Form of Intercreditor Agreement
-vi-
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TERM LOAN AGREEMENT
THIS TERM LOAN AGREEMENT, dated as of October 30, 1997, is among PIONEER
AMERICAS, INC., a corporation organized under the laws of Delaware (the
"Borrower"), PIONEER AMERICAS ACQUISITION CORP., a corporation organized under
the laws of Delaware ("PAAC"or the "Parent Guarantor"), the various financial
institutions as are or may become parties hereto (collectively, the "Lenders"),
DLJ CAPITAL FUNDING, INC. ("DLJ"), as syndication agent (the "Syndication
Agent") for the Lenders, SALOMON BROTHERS HOLDING COMPANY INC ("Salomon"), as
documentation agent (the "Documentation Agent") for the Lenders, BANK OF
AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION ("BofA"), as administrative
agent (the "Administrative Agent") for the Lenders, and UNITED STATES TRUST
COMPANY OF NEW YORK, as collateral agent ("Collateral Agent") for the Secured
Parties (as defined below).
W I T N E S S E T H:
WHEREAS, PCI Chemicals Canada Inc., a corporation organized under the laws
of the Province of New Brunswick ("PCICC"), PCI Carolina, Inc., a corporation
organized under the laws of Delaware ("PCI Carolina"), and Pioneer Companies,
Inc., a corporation organized under the laws of Delaware and the parent of PAAC
("PCI") entered into an Asset Purchase Agreement dated as of September 22, 1997
(the "Purchase Agreement") with ICI Canada Inc. ("the Canadian Seller"), ICI
Americas Inc. (the "U.S. Seller") and Imperial Chemical Industries PLC (the
"ICI Parent") (and, together with the Canadian Seller and the U.S. Seller, the
"Sellers"), pursuant to which PCICC, PCI Carolina and Pioneer Licensing, Inc.,
a corporation organized under the laws of Delaware ("Pioneer Licensing") will
acquire all of the assets and properties used by the Sellers in their North
American chlor-alkali business (the "Target Business") for an aggregate
purchase price of approximately $235,600,000 (the "Acquisition");
WHEREAS, PCICC intends to issue senior secured notes due 2007 for gross
cash proceeds of $175,000,000, which proceeds would be used, in part, to fund
the Acquisition (the "Senior Secured Note Offering", and, together with the
Acquisition and the transactions relating thereto, the "Transaction");
WHEREAS, in connection with the Transaction, the Borrower desires to
obtain from the Lenders a commitment to provide $100,000,000 in term loans, the
proceeds of which will be used, in part, to fund the Acquisition, and pay
certain fees and expenses arising in connection with the Transaction not
exceeding $14,400,000 in the aggregate; and
WHEREAS, the Lenders are willing, on the terms and subject to the
conditions hereinafter set forth (including Article V), to extend the
commitments and make the loans described herein to the Borrower;
NOW, THEREFORE, the parties hereto agree as follows:
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ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether or not
underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof):
"Acquisition" is defined in the first recital.
"Acquisition Agreements" means the Purchase Agreement and each agreement
delivered pursuant to the terms thereof, including the Pension Transfer
Agreement between PCICC and the Canadian Seller, Non-Competition Agreement
among the ICI Parent, the Canadian Seller, the U.S. Seller, PCICC and PCI
Carolina, the Transition Services Agreement between the Canadian Seller and
PCICC, the License Agreement between ICI Chemicals & Polymers Limited and
PCICC, the License Agreement among ICI Parent, ICI Chemicals & Polymers, the
Canadian Seller and PCICC and the Lease with respect to the facility in
Cornwall, Ontario between the Canadian Seller and PCICC.
"Administrative Agent" is defined in the preamble and includes each other
Person as shall have subsequently been appointed as the successor
Administrative Agent pursuant to Section 10.5.
"Affiliate" means, with respect to any party, any Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such party including any estate or trust under will of such party.
For purposes of this definition, "control" (including with correlative
meanings, the terms "controlling," "controlled by" and "under common control
with"), as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided, however, that beneficial ownership of 5% or
more of the voting securities of a Person shall be deemed to be control.
"Affiliate Guarantors" means, collectively, PCI Carolina, Pioneer
Licensing, PCAC, All-Pure, Imperial, BMPC, All Pure Chemical Northwest, Inc., a
Washington corporation, Pioneer Chlor Alkali International, Inc., a Barbados
corporation, G.O.W. Corporation, a Nevada corporation, Pioneer East, TCH, T.C.
Products, Inc. and each other Person that becomes a guarantor under the
Affiliate Guaranty.
"Affiliate Guaranty" means the Guaranty executed and delivered by an
Authorized Officer of each Affiliate Guarantor pursuant to Section 5.3,
substantially in the form of Exhibit D-1 attached hereto, as amended,
supplemented, amended and restated or otherwise modified from time to time.
"Affiliate Security Agreement" means the Security Agreement executed and
delivered by an Authorized Officer of each of PCI Carolina and Pioneer
Licensing pursuant to Section 5.9, substantially in the form of Exhibit F-2
hereto, together with each Patent Security Agreement, Trademark Security
Agreement and Copyright Security Agreement, if any, relating thereto and
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substantially in the form of Exhibits A, B and C, respectively attached
thereto, in each case as amended, supplemented, amended and restated, or
otherwise modified from time to time.
"Agents" means, collectively, the Administrative Agent, the Syndication
Agent and the Documentation Agent.
"Agreement" means, on any date, this Term Loan Agreement as originally in
effect on the Effective Date and as thereafter from time to time amended,
supplemented, amended and restated, or otherwise modified and in effect on such
date.
"All-Pure" means All-Pure Chemical Co., a California corporation and
direct Wholly-Owned Restricted Subsidiary of PAI.
"Alternate Base Rate" means, for any day and with respect to all Base Rate
Loans, a fluctuating rate of interest per annum equal to the higher of: (a)
0.50% per annum above the Federal Funds Rate most recently determined by the
Administrative Agent; and (b) the rate of interest in effect for such day as
most recently publicly announced or established by the Administrative Agent at
its Domestic Office as its "reference rate". (The "reference rate" is a rate
set by the Administrative Agent based upon various factors including the
Administrative Agent's costs and desired return, general economic conditions
and other factors, and is used as a reference point for pricing some loans,
which may be priced at, above or below such announced rate.) Any change in the
reference rate announced by the Administrative Agent shall take effect at the
opening of business on the day of such establishment or announcement.
"Applicable Margin" means (i) with respect to the unpaid principal amount
of each Term Loan maintained as a Base Rate Loan, 162.5 basis points and (ii)
with respect to the unpaid principal amount of each Term Loan maintained as a
LIBO Rate Loan, 287.5 basis points.
"Arranger" means Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation, a
Delaware corporation.
"Asset Sale" means a PAAC Asset Sale or a PCIFP Asset Sale.
"Assignee Lender" is defined in Section 11.11.1.
"Assignor Lender" is defined in Section 11.11.1.
"Attributable Indebtedness" means, with respect to any Sale and Leaseback
Transaction, as at the time of determination, the greater of (i) the Fair
Market Value of the property subject to such transaction and (ii) the present
value (discounted at a rate equivalent to the Borrower's then current weighted
average cost of funds for borrowed money, compounded on a semi-annual basis) of
the total net obligations of the lessee for rental payments during the
remaining term of the lease included in such arrangement (including any period
for which such lease has been extended). As used in the preceding sentence,
the "total net obligations of the lessee for rental payments" under any lease
for any such period means the sum of rental and other payments required to be
paid with respect to such period by the lessee thereunder excluding any amounts
required to be paid by such lessee on account of maintenance and repairs,
insurance, taxes, assessments, water rates or similar charges. In the case of
any lease which is terminable by the lessee upon payment of a penalty, such net
amount of rent also includes the amount of such
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penalty, but no rent will be considered as required to be paid under such lease
subsequent to the first date upon which it may be so terminated.
"Authorized Officer" means, relative to any Obligor, those of its officers
whose signatures and incumbency shall have been certified to the Administrative
Agent and the Lenders pursuant to Section 5.1.
"Bankruptcy Law" means, as the context may require, Canadian Bankruptcy
Law and/or U.S. Bankruptcy Law.
"Base Rate Loan" means a Term Loan bearing interest at a fluctuating rate
determined by reference to the Alternate Base Rate.
"BMPC" means Black Mountain Power Company, a Texas corporation and direct
Wholly-Owned Subsidiary of PCAC.
"Board of Directors" means, with respect to any Person, the board of
directors of such Person or any committee thereof duly authorized to act on
behalf of such Board of Directors.
"Board Resolution" of any corporation means a copy of a resolution
certified by the Secretary or an Assistant Secretary of such corporation to
have been duly adopted by the board of directors of such entity and to be in
full force and effect on the date of such certification and delivered to the
Administrative Agent.
"BofA" is defined in the preamble.
"Bond" means the Bond executed and delivered by an Authorized Officer of
the Borrower pursuant to Section 5.2, substantially in the form of Exhibit
A-2(a) attached hereto, as amended, supplemented, amended and restated, or
otherwise modified from time to time.
"Bond Pledge Agreement" means the Bond Pledge Agreement executed and
delivered by an Authorized Officer of the Borrower pursuant to Section 5.2,
substantially in the form of Exhibit A-2(b) attached hereto, as amended,
supplemented, amended and restated, or otherwise modified from time to time.
"Borrower" is defined in the preamble.
"Borrower Closing Date Certificate" means a certificate of an Authorized
Officer of the Borrower substantially in the form of Exhibit G-1 hereto,
delivered pursuant to Section 5.11.
"Borrowing" means Term Loans of the same type and, in the case of LIBO
Rate Loans, having the same Interest Period made by all Lenders on the same
Business Day.
"Borrowing Base" means, as of any date, an amount equal to the sum of (a)
85% of the net book value of all accounts receivable of PAAC and its Restricted
Subsidiaries as of such date, (b) 50% of the net book value of all inventory
owned by PAAC and its Restricted Subsidiaries as of such date, and (c) the
lesser of (x) $10,000,000 and (y) 85% of the net book value of all accounts
receivable of Kemwater as of such date plus 50% of the net book value of all
inventory as of such date owned by Kemwater, all calculated on a consolidated
basis and in
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accordance with GAAP. To the extent that information is not available as to
the amount of accounts receivable or inventory as of a specific date, PAAC may
utilize the most recent available quarterly or annual financial report for
purposes of calculating the Borrowing Base.
"Borrowing Request" means a loan request and certificate duly executed by
an Authorized Officer of the Borrower, substantially in the form of Exhibit B
hereto.
"Business Day" means (a) any day which is neither a Saturday or Sunday nor
a legal holiday on which banks are authorized or required to be closed in
Chicago, Illinois or New York City and (b) with respect to Borrowings of,
Interest Periods with respect to, payments of principal and interest in respect
of, continuations or conversions of Base Rate Loans into, LIBO Rate Loans, any
day on which dealings in Dollars are carried on in the London interbank market.
"Canadian Bankruptcy Law" means the Bankruptcy and Insolvency Act
(Canada), as amended, the Companies' Creditors Arrangement Act (Canada), as
amended, the Winding-Up and Restructuring Act (Canada), as amended, or any
similar Canadian federal or provincial law relating to bankruptcy, insolvency,
receivership, winding-up, liquidation, reorganization or relief of debtors or
any amendment to, succession to or change in any such law.
"Canadian Demand Debenture" means each demand debenture executed and
delivered by an Authorized Officer of PCICC pursuant to Section 5.8,
substantially in the form of Exhibit E-1(a) attached hereto, as amended,
supplemented, amended and restated, or otherwise modified from time to time.
"Canadian Demand Debenture Pledge Agreement" means each debenture pledge
agreement executed and delivered by an Authorized Officer of PCICC pursuant to
Section 5.8, substantially in the form of Exhibit E-1(b) attached hereto, as
amended, supplemented, amended and restated, or otherwise modified from time to
time.
"Canadian Environmental Laws" means all applicable Canadian federal,
provincial or local statutes, laws, ordinances, codes, rules, regulations and
guidelines having legally binding effect (including consent decrees and
administrative orders) relating to the protection and conservation of the
environment concerning any hazardous, toxic or dangerous waste, substance or
constituent, or any pollutant or contaminant.
"Canadian Hazardous Materials" means any toxic substance, hazardous
substance, hazardous material, hazardous chemical, hazardous waste, pollutant
or contaminant, defined or qualifying as such in (or for the purposes of) any
Canadian Environmental Law, and shall include, but not be limited to,
petroleum, including crude oil, any radioactive material, polychlorinated
biphenyls and asbestos in any form or condition.
"Canadian Pension Plan" means a pension plan that is required to be
registered under any Canadian federal laws, regulations, rules or other
requirements of any Canadian province.
"Canadian Seller" is defined in the first recital.
"Canadian Subsidiary Guaranty" means the Guaranty executed and delivered
by an Authorized Officer of PCICC pursuant to Section 5.3, substantially in the
form of Exhibit D-2
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attached hereto, as amended, supplemented, amended and restated or otherwise
modified from time to time.
"Canadian Subsidiary Security Agreement" means the Security Agreement
executed and delivered by an Authorized Officer of PCICC pursuant to Section
5.9, substantially in the form of Exhibit F-1 hereto, as amended, supplemented,
amended and restated, or otherwise modified from time to time, together with
each Patent Security Agreement, Trademark Security Agreement and Copyright
Security Agreement, if any, relating thereto and substantially in the form of
Exhibits A, B and C, respectively attached thereto, in each case as amended,
supplemented, amended and restated, or otherwise modified from time to time.
"Capital Stock" means, with respect to any Person, any common stock,
preferred stock and any other capital stock of such Person and shares,
interest, participations or other ownership interest (however designated), of
any Person and any rights (other than debt securities convertible into, or
exchangeable for, capital stock), warrants or options to purchase any of the
foregoing, including each class of common stock and preferred stock of such
Person if such Person is a corporation and each general and limited partnership
interest of such Person if such Person is a partnership.
"Capitalized Lease Obligation" means Indebtedness represented by
obligations under a lease that is required to be capitalized for financial
reporting purposes in accordance with GAAP and the amount of such Indebtedness
shall be the capitalized amount of such obligations determined in accordance
with GAAP.
"Cash Flow" for any period means the Consolidated Net Income of PAAC and
its Restricted Subsidiaries for such period, plus the following to the extent
included in calculating such Consolidated Net Income: (i) Consolidated Interest
Expense, (ii) income tax expense and (iii) depreciation, depletion and
amortization expense.
"CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
"CERCLIS" means the Comprehensive Environmental Response Compensation
Liability Information System List.
"Change of Control" means the occurrence of any of the following: (i) a
"person" or "group" (as such terms are used in Sections 14(d)(2) and 13(d)(3),
respectively, of the Exchange Act), other than Substantial Shareholders, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act) of at least 50% of the outstanding voting power of the fully diluted
Voting Stock of PAAC or PCI, (ii) the adoption of a plan relating to the
liquidation or dissolution of PAAC, PCI or the Borrower, (iii) the merger or
consolidation of PAAC or PCI with or into another corporation with the effect
that the stockholders of PAAC or PCI immediately prior to such merger or
consolidation cease to be the "beneficial owners" (as defined in Rule 13d-3
under the Exchange Act) of 50% or more of the combined voting power of the
securities of the surviving corporation of such merger or the corporation
resulting from such merger or consolidation ordinarily (and apart from rights
arising under special circumstances) having the right to vote in the election
of directors outstanding immediately after such merger or consolidation, (iv)
during any period of two consecutive calendar years individuals who are at the
beginning of such period (together with any new directors whose election by the
board of
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directors of PAAC or PCI, or whose nomination for election by the shareholders
of PAAC or PCI, was approved by a vote of a majority of the directors then
still in office who either were directors at the beginning of such period or
whose election or nomination for election was previously so approved) cease for
any reason to constitute a majority of the directors of PAAC or PCI then in
office or (v) the Borrower or any PCIFP Company ceases to be a Wholly-Owned
Subsidiary of PAAC. Notwithstanding the foregoing, a Change of Control shall
not be deemed to have occurred under clause (iii) above solely as a result of a
merger or consolidation of PAAC with or into PCI provided that such merger or
consolidation is permitted under Section 7.2.5.
"Closing Date" means the date of the initial Borrowing, not to be later
than December 31, 1997.
"Closing Date Certificate" means, as the context may require, the Borrower
Closing Date Certificate, the Parent Guarantor Closing Date Certificate and/or
the PCI Closing Date Certificate.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified.
"Collateral" means any property or assets subject to one or more of the
Liens evidenced or created by any Loan Document.
"Collateral Agent" is defined in the preamble.
"Collateral Proceeds" is defined in clause (a) of Section 7.2.6.
"Commitment Letter" means the commitment letter, dated August 18, 1997,
among the Borrower, the Arranger, the Syndication Agent and the Documentation
Agent, including all annexes and exhibits thereto, as amended, supplemented,
amended and restated or otherwise modified from time to time.
"Commitment Termination Event" means (i) the occurrence of any Event of
Default described in clause (a), (b) or (c) of Section 8.1.9, or (ii) the
occurrence and continuance of any other Event of Default and either (x) the
declaration of the Term Loans to be due and payable pursuant to Section 8.3, or
(y) in the absence of such declaration, the giving of notice to the Borrower by
the Administrative Agent, acting at the direction of the Required Lenders, that
the Term Loan Commitments have been terminated.
"Consolidated Cash Flow Coverage Ratio" means, as of any date of
determination, the ratio of (i) the aggregate amount of Cash Flow for the
period of the most recent four consecutive fiscal quarters for which internal
financial statements are available prior to the date of such determination to
(ii) Consolidated Interest Expense for such four fiscal quarters of PAAC and
its Restricted Subsidiaries; provided, however, that (A) if PAAC or any of its
Restricted Subsidiaries has incurred any Indebtedness since the beginning of
such period that remains outstanding or if the transaction giving rise to the
need to calculate the Consolidated Cash Flow Coverage Ratio is an incurrence of
Indebtedness, or both, Cash Flow and Consolidated Interest Expense for such
period will be calculated after giving effect on a pro forma basis to such
Indebtedness as if such Indebtedness had been issued on the first day of such
period and the discharge of any other Indebtedness repaid, repurchased,
defeased or otherwise discharged with
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the proceeds of such new Indebtedness as if such discharge had occurred on the
first day of such period, (B) if since the beginning of such period PAAC or any
of its Restricted Subsidiaries has made any Asset Sale, the Cash Flow for such
period will be reduced by an amount equal to the Cash Flow (if positive),
directly attributable to the assets which are the subject of such Asset Sale
for such period, or increased by an amount equal to the Cash Flow (if
negative), directly attributable thereto for such period and Consolidated
Interest Expense for such period will be reduced by an amount equal to the
Consolidated Interest Expense directly attributable to any Indebtedness of PAAC
or any of its Restricted Subsidiaries repaid, repurchased, defeased or
otherwise discharged with respect to PAAC and its continuing Restricted
Subsidiaries in connection with any such sale or other disposition for such
period (or, if the Capital Stock of any such Restricted Subsidiary is sold, the
Consolidated Interest Expense for such period directly attributable to the
Indebtedness of such Restricted Subsidiary to the extent PAAC and its
continuing Restricted Subsidiaries are no longer liable for such Indebtedness
after such sale), (C) if since the beginning of such period PAAC or any
Restricted Subsidiary (by merger or otherwise) has made an Investment in any
Restricted Subsidiary of PAAC (or any Person which becomes a Restricted
Subsidiary of PAAC) or an acquisition of assets, including any acquisition of
assets occurring in connection with a transaction causing a calculation to be
made hereunder, which constitutes all or substantially all of an operating unit
of a business, Cash Flow and Consolidated Interest Expense for such period will
be calculated after giving pro forma effect thereto (including the incurrence
of any Indebtedness) as if such Investment or acquisition occurred on the first
day of such period and (D) in making such computation, Consolidated Interest
Expense attributable to any Indebtedness incurred under any revolving credit
facility will be computed based on the average daily balance of such
Indebtedness during such period. For purposes of this definition, whenever pro
forma effect is to be given to an acquisition of assets, the amount of income
or earnings relating thereto, and the amount of Consolidated Interest Expense
associated with any Indebtedness incurred in connection therewith, the pro
forma calculations will be determined in good faith by a responsible financial
or accounting officer of PAAC. If any Indebtedness bears a floating rate of
interest and is being given pro forma effect, the interest on such Indebtedness
will be calculated as if the rate in effect on the date of determination had
been the applicable rate for the entire period.
"Consolidated Interest Expense" means, for any period, interest expense of
PAAC and its consolidated Restricted Subsidiaries, excluding amortization of
any deferred financing fees, plus, to the extent not included in such interest
expense, (i) interest expense attributable to Capitalized Lease Obligations,
(ii) amortization of debt discount and debt issuance cost, (iii) capitalized
interest, (iv) non-cash interest expense, (v) commissions, discounts and other
fees and charges owed with respect to letters of credit and bankers' acceptance
financing, (vi) interest actually paid by PAAC or any such Restricted
Subsidiary under any guarantee of Indebtedness or other obligation of any other
Person, (vii) net costs associated with Hedging Obligations (including
amortization of fees), (viii) Preferred Stock dividends in respect of all
Redeemable Stock of PAAC held by Persons other than PAAC or a Wholly-Owned
Restricted Subsidiary of PAAC and (ix) the cash contributions to any employee
stock ownership plan or similar trust to the extent such contributions are used
by such plan or trust to pay interest or fees to any Person (other than PAAC)
in connection with loans incurred by such plan or trust to purchase newly
issued or treasury shares of the Capital Stock of PAAC.
"Consolidated Net Income" means, for any period, and as to any Person, the
aggregate Net Income of such Person and its Subsidiaries (other than, in the
case of the Borrower or PAAC, its Unrestricted Subsidiaries) for such period
determined in accordance with GAAP;
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provided that (i) the Net Income of any Person which is not a Subsidiary of
such Person but which is consolidated with such Person or is accounted for by
such Person by the equity method of accounting will be included only to the
extent of the amount of cash dividends or cash distributions paid to such
Person or a Wholly-Owned Restricted Subsidiary of such Person (other than, in
the case of the Borrower or PAAC, its Unrestricted Subsidiaries), (ii) the Net
Income of any Person acquired by such Person or a Subsidiary of such Person in
a pooling of interests transaction for any period prior to the date of such
acquisition will be excluded, (iii) the Net Income of any Subsidiary of such
Person that is subject to restrictions, direct or indirect, on the payment of
dividends or the making of distributions to such Person will be excluded to the
extent of such restrictions, (iv) the Net Income of (A) any Unrestricted
Subsidiary and (B) any Subsidiary less than 80% of whose securities having the
right (apart from the right under special circumstances) to vote in the
election of directors are owned by the Borrower or PAAC, as the case may be, or
its Wholly-Owned Restricted Subsidiaries will be included only to the extent of
the amount of cash dividends or cash distributions actually paid by such
Subsidiary to the Borrower or PAAC, as the case may be, or one of its
Wholly-Owned Restricted Subsidiaries (v) in the case of the Borrower or PAAC,
the Net Income attributable to any business, properties or assets acquired (by
way of merger, consolidation, purchase or otherwise) by the Borrower or any
Restricted Subsidiary of the Borrower or PAAC or any Restricted Subsidiary of
PAAC, as the case may be, for any period prior to the date of such acquisition
will be excluded, (vi) all extraordinary gains and losses, and any gain or loss
realized upon the termination of any employee pension benefit plan, in respect
of dispositions of assets other than in the ordinary course of business and any
one- time increase or decrease to Net Income which is required to be recorded
because of the adoption of new accounting policies, practices or standards
required by GAAP (together, in each case, with any provision for taxes) will be
excluded and (vii) all amounts of "other income, net" classified as such on one
or more lines of such Person's statement of operations, in accordance with
GAAP, net of applicable income taxes, will be excluded from such Person's
aggregate Net Income; provided that the foregoing exclusion will not apply to
cash dividends or cash distributions paid in respect of indirect equity
interests in Saguaro Power Company, a Limited Partnership, and Canso Chemicals
Limited to the extent included in clause (i) of this definition.
"Consolidated Net Worth" means, for any Person, the total of the amounts
shown on the balance sheet of such Person and its consolidated Subsidiaries
(other than, in the case of the Borrower or PAAC, its Unrestricted
Subsidiaries), determined on a consolidated basis without duplication in
accordance with GAAP, as of the end of the most recent fiscal quarter of such
Person ending at least 45 days prior to the taking of any action for the
purpose of which the determination is being made, as (i) the amount of Capital
Stock (other than Redeemable Stock) plus (ii) the amount of surplus and
retained earnings (or, in the case of a surplus or retained earnings deficit,
minus the amount of such deficit).
"Contingent Liability" means any agreement, undertaking or arrangement by
which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or otherwise to invest in, a
debtor, or otherwise to assure a creditor against loss) the indebtedness,
obligation or any other liability of any other Person (other than by
endorsements of instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of any other
Person. The amount of any Person's obligation under any Contingent Liability
shall (subject to any limitation set forth therein) be deemed to be the
outstanding principal amount of the debt, obligation or other liability
guaranteed thereby.
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"Contingent Payment Agreement" means the Contingent Payment Agreement
dated as of April 20, 1995 among PAAC, PCI and the sellers named therein.
"Continuation/Conversion Notice" means a notice of continuation or
conversion and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of Exhibit C hereto.
"Credit Facility" means any revolving credit facility or similar
arrangement that makes credit available entered into by and among PAAC, the
Borrower and/or any PAI Guarantor and the lending institutions party thereto,
including any credit agreement, related notes, guarantees, collateral
documents, instruments and agreements executed in connection therewith, and in
each case as amended, modified, renewed, refunded, replaced or refinanced from
time to time.
"Custodian" means any receiver, trustee, assignee, liquidator or similar
official under any Bankruptcy Law.
"Default" means any Event of Default or any condition, occurrence or event
which, after notice or lapse of time or both, would, unless cured or waived,
constitute an Event of Default.
"Disclosure Schedule" means the Disclosure Schedule attached hereto as
Schedule I, as it may be amended, supplemented or otherwise modified from time
to time by the Borrower with the written consent of the Agents and the Required
Lenders.
"DLJ" is defined in the preamble.
"Documentation Agent" is defined in the preamble and includes each other
Person as shall have subsequently been appointed as the successor Documentation
Agent pursuant to Section 10.5.
"Dollar" and the sign "$" mean lawful money of the United States.
"Domestic Office" means, relative to any Lender, the office of such Lender
designated as such in Schedule II hereto or designated in the Lender Assignment
Agreement or such other office of a Lender (or any successor or assign of such
Lender) within the United States as may be designated from time to time by
notice from such Lender, as the case may be, to each other Person party hereto.
A Lender may have separate Domestic Offices for purposes of making or
maintaining, as the case may be, Base Rate Loans.
"Effective Date" means the date this Agreement becomes effective pursuant
to Section 11.8.
"Eligible Investments" means, (i) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than 90 days from the date of acquisition, (ii) time deposits and certificates
of deposit with maturities of not more than 90 days from the date of
acquisition of any commercial banking institution that is a member of the
Federal Reserve System having capital and surplus in excess of $500,000,000,
whose debt has a rating at the time of any such investment of at least "A-2" or
the equivalent thereof by S&P or at least "P-2" or the equivalent
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thereof by Xxxxx'x, or any Lender or any bank or financial institution party to
the Revolving Credit Facility, (iii) fully secured repurchase obligations with
a term of not more than seven days for underlying securities of the types
described in clause (i) entered into with any bank or financial institution
meeting the qualifications specified in clause (ii) above, (iv) commercial
paper issued by the parent corporation of any commercial banking institution
that is a member of the Federal Reserve System having capital and surplus in
excess of $500,000,000 and commercial paper or master notes of issuers, rated
at the time of any such investment at least "A-2" or the equivalent thereof by
S&P or at least "P-2" or the equivalent thereof by Xxxxx'x, or any bank or
financial institution party to the Revolving Credit Facility, and in each case
maturing within 270 days after the date of acquisition, and (v) any shares in
an open-end mutual fund organized by a bank or financial institution having
combined capital and surplus of at least $500,000,000 investing solely in
investments permitted by the foregoing clauses (i), (ii) and (iv).
"Environmental Laws" means, as the context may require, Canadian
Environmental Laws and/or U.S. Environmental Laws.
"Equity Interests" means shares, interests, participations or other
equivalents (however designated) of Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security which is
convertible into, or exchangeable for, Capital Stock).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time.
References to sections of ERISA also refer to any successor sections.
"ERISA Affiliate" means any corporation, partnership, or other trade or
business (whether or not incorporated) that is, along with PAAC, a member of a
controlled group of corporations or a controlled group of trades or businesses,
as described in Section 414(b) and 414(c), respectively, of the Code or Section
4001 of ERISA, or a member of the same affiliated service group within the
meaning of Section 414(m) of the Code.
"Event of Default" is defined in Section 8.1.
"Excess Land" means certain real property adjoining the sites of PCAC's
Henderson, Nevada and St. Xxxxxxx, Louisiana plants and the Mojave, California
property owned by Imperial that is not used in the business conducted at such
sites, which real property is referred to and defined in the Contingent Payment
Agreement as the "Subject Parcels".
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exempt Properties" means (i) the real property located at Xxxxxxxx,
Xxxxxxx, Xxxxxx which is to be leased by PCICC from the Canadian Seller
pursuant to the Lease referred to in the definition of "Acquisition Agreements"
and (ii) the real property located at Point Xxxxxx, Nova Scotia, Canada upon
which storage tanks to be acquired by PCICC from the Canadian Seller under the
Purchase Agreement are situated.
"Existing Affiliate Agreements" means (i) agreements between PAAC or any
of its Subsidiaries and Saguaro Power Company, a Limited Partnership, relating
to the delivery of steam and other services, existing on the date hereof and
listed on Item 7.2.8 ("Existing Affiliate
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Agreements") of the Disclosure Schedule, (ii) the Tax Sharing Agreement and
(iii) agreements between PAAC or any of its Subsidiaries and Basic
Investments, Inc. relating to the delivery of water and power, power
transmission services, and other services, existing on the date hereof and
listed on Item 7.2.8 ("Existing Affiliate Agreements") of the Disclosure
Schedule hereto and (iv) any other agreements with affiliates of the Borrower,
existing on the date hereof and listed on Item 7.2.8 ("Existing Affiliate
Agreements") of the Disclosure Schedule hereto.
"Existing Indebtedness" means all Indebtedness (other than the Senior
Secured Notes and Existing Senior Secured Notes outstanding and the loans
outstanding under the Existing Term Loan Agreement) of PAAC or any of its
Restricted Subsidiaries existing on the date hereof and listed on Item 7.2.1(c)
("Existing Indebtedness") of the Disclosure Schedule.
"Existing Senior Secured Note Indenture" means the Indenture dated as of
June 17, 1997, among PAAC, the guarantors party thereto, and United States
Trust Company of New York, as trustee, as the same may be amended, restated,
amended and restated or otherwise modified from time to time in accordance with
the terms hereof and thereof.
"Existing Senior Secured Notes" means the 91/4% Senior Secured Notes due
2007 of PAAC issued pursuant to the Existing Senior Secured Note Indenture,
including any senior secured notes of PAAC with substantially identical terms
exchanged therefor pursuant to a registration statement under the Securities
Act of 1933, as amended.
"Existing Term Loan Agreement" means the Term Loan Agreement dated as of
June 17, 1997, among PAAC, the financial institutions from time to time party
thereto, DLJ, as syndication agent, BofA, as administrative agent and Salomon,
as documentation agent for such financial institutions, as the same may be
amended, restated, amended and restated or otherwise modified from time to time
in accordance with the terms hereof and thereof.
"Fair Market Value" means, with respect to any asset or property, the
price which could be negotiated in an arm's-length transaction, for cash,
between a willing seller and a willing buyer, neither of whom is under undue
pressure or compulsion to complete the transaction. Fair Market Value will be
determined by a majority of the members of the Board of Directors of the Person
the asset or property of which is being sold or transferred and a majority of
the disinterested members of such Board of Directors, if any, acting in good
faith and will be evidenced by a duly and properly adopted resolution of such
Board of Directors.
"Federal Funds Rate" means, for any period, a fluctuating interest rate
per annum equal for each day during such period to (i) the weighted average of
the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published for such day
(or, if such day is not a Business Day, for the next preceding Business Day) by
the Federal Reserve Bank of New York, or (ii) if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by the Administrative Agent from three federal
funds brokers of recognized standing selected by it.
"Fee Letter" means the confidential fee letter, dated as of August 18,
1997, among the Borrower, the Arranger, the Syndication Agent and the
Documentation Agent, as amended, supplemented, amended and restated or
otherwise modified from time to time.
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"Fiscal Quarter" means any fiscal quarter of a Fiscal Year.
"Fiscal Year" means any period of twelve consecutive months ending on
December 31; references to a Fiscal Year with a numbering corresponding to any
calendar year refer to the fiscal year ending on the 31st of December during
such calender year.
"F.R.S. Board" means the Board of Governors of the Federal Reserve System
or any successor thereto.
"GAAP" is defined in Section 1.4.
"Guarantors" means, collectively, the Parent Guarantor and the PAI
Guarantors.
"Guaranty" means, as the context may require, any PAI Guaranty and/or the
provisions of Article IX.
"Hazardous Materials" means, as the context may require, any Canadian
Hazardous Materials and/or any U.S. Hazardous Materials.
"Hedging Obligations" means the obligations of any Person or entity
pursuant to any swap or cap agreement, exchange agreement, collar agreement,
option, futures or forward hedging contract, derivative instrument or other
similar agreement or arrangement designed to protect such Person or entity
against fluctuations in interest rates or foreign exchange rates or the price
of raw materials and other chemical products used or produced in the Borrower's
business, as the case may be.
"herein", "hereof", "hereto", "hereunder" and similar terms contained in
this Agreement or any other Loan Document refer to this Agreement or such other
Loan Document, as the case may be, as a whole and not to any particular
Section, paragraph or provision of this Agreement or such other Loan Document.
"ICI Parent" is defined in the first recital.
"Imperial" means Imperial West Chemical Co., a Nevada corporation and
direct Wholly-Owned Subsidiary of PAI.
"including" means including without limiting the generality of any
description preceding such term, and, for purposes of this Agreement and each
other Loan Document, the parties hereto agree that the rule of ejusdem generis
shall not be applicable to limit a general statement, which is followed by or
referable to an enumeration of specific matters, to matters similar to the
matters specifically mentioned.
"incur" has the meaning ascribed in Section 7.2.1; provided that (a) with
respect to any Indebtedness of any Restricted Subsidiary of PAAC (including the
Borrower and its Restricted Subsidiaries) that is owing to PAAC or another
Restricted Subsidiary of PAAC (including the Borrower and its Restricted
Subsidiaries) any disposition, pledge or transfer of such Indebtedness to any
Person (other than PAAC or a Wholly-Owned Restricted Subsidiary of PAAC) shall
be deemed to be an incurrence of such Indebtedness and (b) with respect to any
Indebtedness of PAAC or a Restricted Subsidiary of PAAC (including the Borrower
and its Restricted Subsidiaries) that is owing to another Restricted Subsidiary
of PAAC (including the Borrower and its
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Restricted Subsidiaries), any transaction pursuant to which a Wholly-Owned
Restricted Subsidiary of PAAC to which such Indebtedness is owing ceases to be
a Wholly-Owned Restricted Subsidiary of PAAC shall be deemed to be an
incurrence of such Indebtedness; and provided, further, that any Indebtedness
of a Person existing at the time such Person becomes a Restricted Subsidiary of
PAAC shall be deemed to be incurred by such Restricted Subsidiary at the time
it becomes a Restricted Subsidiary of PAAC. The term "incurrence" has a
corresponding meaning.
"Indebtedness" of any Person means, without duplication, all liabilities
with respect to (i) indebtedness for money borrowed or which is evidenced by a
bond, debenture, note or other similar instrument or agreement, but excluding
trade credit evidenced by any such instrument or agreement; (ii) reimbursement
obligations, letters of credit and bankers' acceptances; (iii) indebtedness
with respect to Hedging Obligations; (iv) Capitalized Lease Obligations; (v)
indebtedness, secured or unsecured, created or arising in connection with the
acquisition or improvement of any property or asset or the acquisition of any
business; (vi) all indebtedness secured by any Lien upon property owned by such
Person and all indebtedness secured in the manner specified in this clause even
if such Person has not assumed or become liable for the payment thereof; (vii)
all indebtedness of such Person created or arising under any conditional sale
or other title retention agreement with respect to property acquired by such
Person or otherwise representing the deferred and unpaid balance of the
purchase price of any such property, including all indebtedness created or
arising in the manner specified in this clause even though the rights and
remedies of the seller or lender under such agreement in the event of default
are limited to repossession or sale of such property; (viii) guarantees, direct
or indirect, of any indebtedness of other Persons referred to in clauses (i)
through (vii) above, or of dividends or leases, taxes or other obligations of
other Persons, excluding any guarantee arising out of the endorsement of
negotiable instruments for collection in the ordinary course of business; (ix)
contingent obligations in respect of, or to purchase or otherwise acquire or be
responsible or liable for, through the purchase of products or services,
irrespective of whether such products are delivered or such services are
rendered, or otherwise, any such indebtedness referred to in clauses (i)
through (vii) above; (x) any obligation, contingent or otherwise, arising under
any surety, performance or maintenance bond; and (xi) Redeemable Stock of PAAC
valued at the greater of its voluntary or involuntary maximum fixed repurchase
price plus accrued and unpaid dividends; which indebtedness, Capitalized Lease
Obligation, guarantee or contingent or other obligation such Person has
directly or indirectly created, incurred, assumed, guaranteed or otherwise
become liable or responsible for, whether then outstanding or thereafter
created in the case of clauses (i) through (x) above, to the extent any of the
foregoing indebtedness (other than letters of credit and Hedging Obligations)
would appear as a liability on the balance sheet of such Person in accordance
with GAAP. For purposes of the foregoing definition, the "maximum fixed
repurchase price" of any Redeemable Stock which does not have a fixed
repurchase price shall be calculated in accordance with the terms of such
Redeemable Stock as if such Redeemable Stock were purchased on any date on
which Indebtedness is required to be determined pursuant to the Senior Secured
Note Indenture. As used herein, Indebtedness with respect to any Hedging
Obligation means, with respect to any specified Person on any date, the net
amount (if any) that would be payable by such specified Person upon the
liquidation, close-out or early termination on such date of such Hedging
Obligation. For purposes of the foregoing, any settlement amount payable upon
the liquidation, close-out or early termination of a Hedging Obligation shall
be calculated by the Borrower in good faith and in a commercially reasonable
manner on the basis that such liquidation, close-out or early termination
results from
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an event of default or other similar event with respect to such specified
Person. Any reference in this definition to indebtedness shall be deemed to
include any renewals, extensions and refundings of any such indebtedness or any
indebtedness, issued in exchange for such indebtedness.
"Indemnified Liabilities" is defined in Section 11.4.
"Indemnified Parties" is defined in Section 11.4.
"Independent Director" means, with respect to any Person, a director of such
Person other than a director (i) who (apart from being a director of such
Person or any of its Subsidiaries) is an employee, insider, associate or
Affiliate of such Person or any of its Subsidiaries or has held any such
position during the previous year or (ii) who is a director, an employee,
insider, associate or Affiliate of another party to the transaction in
question.
"Insurance Proceeds" has the meaning specified in the applicable Mortgage.
"Intercreditor Agreement" means the Intercreditor and Collateral Agency
Agreement, dated as of October 30, 1997, among the Borrower, PCICC, PAAC, the
Trustee, the Administrative Agent and the Collateral Agent, substantially in
the form of Exhibit I attached hereto, as amended, supplemented, amended and
restated or otherwise modified from time to time.
"Intercreditor Collateral Account" means the Collateral Account as defined
in the Intercreditor Agreement.
"Interest Expense" means, for any applicable period, the aggregate
consolidated interest expense of PAAC and its Subsidiaries for such applicable
period, as determined in accordance with GAAP, including the portion of any
payments made in respect of Capitalized Lease Liabilities allocable to interest
expense, but excluding (to the extent included in interest expense) up-front
fees and expenses and other deferred financing costs incurred in connection
with the Transaction.
"Interest Period" means, as to any LIBO Rate Loan, the period commencing on
the Borrowing date of such Term Loan or on the date on which any Term Loan is
converted into or continued as a LIBO Rate Loan, and ending on the date one,
two, three, six or, if available in the Administrative Agent's reasonable
determination, nine or twelve months thereafter as selected by the Borrower in
its Borrowing Request or its Conversion/Continuation Notice; provided however
that:
(i) if any Interest Period would otherwise end on a day that is
not a Business Day, that Interest Period shall be extended to the following
Business Day unless the result of such extension would be to carry such
Interest Period into another calendar month, in which event such Interest
Period shall end on the preceding Business Day;
(ii) any Interest Period that begins on the last Business Day
of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall end on the last Business Day of the calendar month at the end of such
Interest Period;
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(iii) no Interest Period for any Term Loan shall extend beyond
the Stated Maturity Date for such Term Loan;
(iv) no Interest Period applicable to a Term Loan or portion
thereof shall extend beyond any date upon which is due any scheduled
principal payment in respect of the Term Loans unless the aggregate
principal amount of Term Loans represented by Base Rate Loans, or by LIBO
Rate Loans having Interest Periods that will expire on or before such date,
equals or exceeds the amount of such principal payment; and
(v) there shall be no more than five Interest Periods in effect
at any one time.
"Investment" means any direct or indirect advance, loan, other extension of
credit or capital contribution (by means of any transfer of cash or other
property to others or any payment for property or services for the account or
use of others) to, purchase or acquisition of Equity Interests, bonds, notes,
debentures or other securities of, or purchase or other acquisition of all or a
substantial part of the business, Equity Interests or other evidence of
beneficial ownership of, or any other investment in or guarantee of any
Indebtedness of, any Person or any other item that would be classified as an
investment on a balance sheet prepared in accordance with GAAP. Investments do
not include advances to customers and suppliers in the ordinary course of
business and on commercially reasonable terms. In the event PAAC or any
Subsidiary of PAAC (including the Borrower and its Subsidiaries) sells or
otherwise disposes of any Equity Interests of any direct or indirect Subsidiary
of PAAC such that, after giving effect to any such sale or disposition, such
Person is no longer a Subsidiary of PAAC, PAAC shall be deemed to have made an
Investment on the date of any such sale or disposition equal to the Fair Market
Value of the Equity Interests of such Subsidiary not sold or disposed of
determined as provided in the final paragraph of Section 7.2.3.
"Kemwater" means Kemwater North America Company, a Delaware corporation, and
any successor thereto.
"Lender Assignment Agreement" means a Lender Assignment Agreement
substantially in the form of Exhibit H hereto.
"Lender Parties" means the Lenders, the Agents and their respective
successors, transferees and assigns.
"Lenders" is defined in the preamble.
"LIBO Rate" means, relative to any Interest Period for LIBO Rate Loans, the
rate of interest per annum determined by the Administrative Agent to be the
arithmetic mean (rounded upward to the next 1/16th of 1%) of the rates of
interest per annum at which Dollar deposits in the approximate amount of the
Term Loan to be made or continued as, or converted into, a LIBO Rate Loan by
the Administrative Agent and having a maturity comparable to such Interest
Period would be offered to the Administrative Agent in the London interbank
market at its request at approximately 11:00 a.m. (London time) two Business
Days prior to the commencement of such Interest Period.
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"LIBO Rate Loan" means a Term Loan bearing interest, at all times during an
Interest Period applicable to such Term Loan, at a fixed rate of interest
determined by reference to the LIBO Rate (Reserve Adjusted).
"LIBO Rate (Reserve Adjusted)" means, relative to any Term Loan to be made,
continued or maintained as, or converted into, a LIBO Rate Loan for any
Interest Period, the rate of interest per annum (rounded upwards to the next
1/100th of 1%) determined by the Administrative Agent as follows:
LIBO Rate = LIBO Rate
-------------------------------
(Reserve Adjusted) 1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate Loans
will be adjusted automatically as to all LIBO Rate Loans then outstanding as of
the effective date of any change in the LIBOR Reserve Percentage.
"LIBOR Office" means, relative to any Lender, the office of such Lender
designated as such in Schedule II hereto or designated in the Lender Assignment
Agreement pursuant to which such Lender became a Lender hereunder or such other
office of a Lender as shall be so designated from time to time by notice from
such Lender to the Borrower and the Administrative Agent, whether or not
outside the United States, which shall be making, maintaining or continuing
LIBO Rate Loans of such Lender hereunder.
"LIBOR Reserve Percentage" means, relative to any Interest Period for LIBO
Rate Loans, the reserve percentage (expressed as a decimal) equal to the
maximum aggregate reserve requirements (including all basic, emergency,
supplemental, marginal and other reserves and taking into account any
transitional adjustments or other scheduled changes in reserve requirements)
specified under regulations issued from time to time by the F.R.S. Board and
then applicable to assets or liabilities consisting of and including
"Eurocurrency Liabilities", as currently defined in Regulation D of the F.R.S.
Board, having a term approximately equal or comparable to such Interest Period.
"Lien" means any mortgage, pledge, prior claim (within the meaning of the
Civil Code of Quebec), hypothec, lien, security interest, charge, servitude,
assignment, adverse claim, defect of title, restriction, trust, right of set
off or encumbrance of any kind (including any conditional sale or other title
retention agreement and any lease in the nature thereof).
"Loan Document" means this Agreement, the Term Notes, each PAI Guaranty,
each Security Document, the Bond, each Borrowing Request, the Fee Letter and
each other agreement, document or instrument delivered in connection with this
Agreement or any other Loan Document, whether or not specifically mentioned
herein or therein.
"Margin Stock" has the meaning ascribed to such term in Regulation U of the
Federal Reserve Board or any regulation substituted therefor, as in effect from
time to time.
"Material Adverse Effect" means (a) a material adverse effect on the
business, assets, debt service capacity, liabilities (including environmental
liabilities), financial condition, operations or prospects of PAAC and its
Restricted Subsidiaries, taken as a whole, (b) a material adverse effect upon
the ability of the Borrower, PAAC or any other Obligor to perform its
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respective material obligations under the Loan Documents to which it is or will
be a party, or (c) an impairment of the validity or enforceability of, or a
material impairment of the rights, remedies or benefits available to the
Agents, the Arranger, the Collateral Agent or the Lenders under this Agreement
or any other Loan Document.
"Mississauga Property" means the real property located in the city of
Mississauga, regional municipality of Peel; legally described as Part Block D
Plan 718, designated as Parts 1, 2, 3, 4 and 9, Plan 43R-7079.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Mortgage" means, as the context may require, each Canadian Demand Debenture
and/or the Quebec Mortgage and Security Agreement.
"Mortgaged Property" means, collectively, "Immovable Property", "Real
Property" and "Leasehold Property" as defined in each applicable Mortgage.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA, that is maintained for employees of PAAC or any ERISA
Affiliate.
"Net Award" has the meaning specified in each applicable Mortgage.
"Net Cash Proceeds" means, with respect to any issuance or sale of Equity
Interests or debt securities that have been converted into or exchanged for
Equity Interests, as referred to in Section 7.2.3, the proceeds of such
issuance or sale in the form of cash or cash equivalents, net of attorneys'
fees, accountants' fees and brokerage, consultation, underwriting and other
fees and expenses actually incurred in connection with such issuance or sale
and net of taxes paid or payable as a result thereof.
"Net Income" means, for any period, the net income of PAAC and its
Subsidiaries (other than its Unrestricted Subsidiaries) for such period on a
consolidated basis, determined in accordance with GAAP.
"Net Proceeds" means the aggregate cash proceeds received by PAAC or any of
its Restricted Subsidiaries (including the Borrower and its Restricted
Subsidiaries) in respect of any Asset Sale (including the proceeds of insurance
paid on account of the loss of or damage to any property, or compensation or
other proceeds for any property taken by condemnation, eminent domain or
similar proceedings, and any non-cash consideration received by PAAC or any of
its Restricted Subsidiaries from any Asset Sale that is converted into or sold
or otherwise disposed of for cash within 90 days after the relevant Asset
Sale), net of (i) the direct costs relating to such Asset Sale (including
legal, accounting and investment banking fees and sales commissions), (ii) any
taxes paid or payable as a result thereof, (iii) all amounts required to be
applied to the repayment of, or representing the amount of permanent reductions
in the commitments relating to, Indebtedness secured by a Lien on the asset or
assets the subject of such Asset Sale which Lien is permitted pursuant hereto,
(iv) any reserve for adjustment in respect of the sale price of such asset or
assets required by GAAP, (v) all distributions and other payments required to
be made (including any amounts held pending distribution) to minority interest
holders in Subsidiaries or joint ventures as a result of such Asset Sale, and
(vi) all payments due under Existing Affiliate Agreements arising out of an
Asset Sale. The amount of any taxes required to
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be accrued as a liability under GAAP as a consequence of an Asset Sale shall be
the amount thereof as determined in good faith by the Board of Directors of the
Person making such Asset Sale.
"Obligations" means all obligations (monetary or otherwise) of the Borrower
and each other Obligor arising under or in connection with this Agreement, the
Term Notes, and each other Loan Document.
"Obligor" means the Borrower, PAAC or any other Person (other than any
Agent, the Arranger, or any Lender) obligated under any Loan Document.
"Occupational Safety and Health Law" means the Occupational Safety and
Health Act of 1970 and any other U.S. or Canadian federal, state, provincial or
local statute, law, ordinance, code, rule, regulation, order or decree
regulating, relating to or imposing liability or standards of conduct
concerning employee health and/or safety.
"Offering Memorandum" means the offering memorandum of PCICC, dated October
22, 1997, in connection with the offer and sale of the Senior Secured Notes.
"Officers' Certificate" means a certificate executed by the Chairman of the
Board, Vice Chairman, the President or a Vice President (regardless of vice
presidential designation), and by the Treasurer, an Assistant Treasurer, the
Secretary or an Assistant Secretary, of PAAC, the Borrower, or any PAI
Guarantor, as the case may be, and delivered to the Administrative Agent.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel
for PAAC, the Borrower, or any of the PAI Guarantors and who shall be
reasonably acceptable to the Required Lenders.
"Organic Document" means, relative to any Obligor, its certificate of
incorporation, its by-laws and all shareholder agreements, voting trusts and
similar arrangements to which such Obligor is a party applicable to any of its
authorized shares of Capital Stock.
"Original Currency" is defined in clause (a) of Section 8.4.
"Other Currency" is defined in clause (a) of Section 8.4.
"PAAC" is defined in the preamble.
"PAAC Asset Sale" means, with respect to PAAC or any of its Restricted
Subsidiaries (other than a PCIFP Company), the sale, lease, conveyance or other
disposition (including by way of merger or consolidation, and whether by
operation of law or otherwise) to any Person other than PAAC or any of its
Wholly-Owned Restricted Subsidiaries (other than a PCIFP Company) of any of
PAAC's or such Restricted Subsidiary's assets (including (x) any sale or other
disposition of Equity Interests of any such Restricted Subsidiary and (y) any
sale or other disposition of any noncash consideration received by PAAC or such
Restricted Subsidiary from any prior transaction or series of related
transactions that constituted a PAAC Asset Sale hereunder), whether owned on
the date hereof or subsequently acquired, in one transaction or a series of
related transactions; provided, however, that the following will not constitute
PAAC Asset Sales: (i) transactions (other than transactions described in
clause (y) above) in any
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calendar year with aggregate cash and/or Fair Market Value of any other
consideration received (including the unconditional assumption of Indebtedness)
of less than $1,000,000; (ii) a transaction or series of related transactions
that results in a Change of Control; (iii) any sale of assets of PAAC and its
Restricted Subsidiaries or merger permitted pursuant to Section 7.2.5; (iv) any
sale or other disposition of inventory, property (whether real, personal,
movable, immovable or mixed) or equipment that has become worn out, obsolete or
damaged or otherwise unsuitable or no longer needed for use in connection with
the business of PAAC or any of its Restricted Subsidiaries, as the case may be,
in the good faith determination of the Board of Directors of PAAC; and (v) any
sale of inventory to customers in the ordinary and customary course of
business.
"PAI Guarantor" means any guarantor under a PAI Guaranty.
"PAI Guaranty" means, as the context may require, the Affiliate Guaranty,
the Canadian Subsidiary Guaranty, and/or any other guaranty, substantially in
form and substance of any existing PAI Guaranty, together with such other
modifications acceptable to the Agents and their counsel which are necessary to
permit the guarantee (whether direct or pass-through in nature) by the
guarantor thereunder of the Obligations of the Borrower.
"Parent Guarantor" is defined in the preamble.
"Parent Guarantor Closing Date Certificate" means a certificate of an
Authorized Officer of the Parent Guarantor substantially in the form of Exhibit
G-2 hereto, delivered pursuant to Section 5.11.
"Participant" is defined in Section 11.11.2.
"PBGC" means the Pension Benefit Guaranty Corporation and any successor
entity.
"PCAC" means Pioneer Chlor Alkali Company, Inc., a Delaware corporation and
indirect Wholly-Owned Restricted Subsidiary of PAAC, and any successor thereto.
"PCI" is defined in the first recital.
"PCICC" is defined in the first recital.
"PCIFP Asset Sale" means, with respect to any PCIFP Company or any of its
Restricted Subsidiaries, the sale, lease, conveyance or other disposition
(including by way of merger or consolidation, and whether by operation of law
or otherwise) to any Person other than such PCIFP Company or a Wholly-Owned
Restricted Subsidiary of such PCIFP Company of any assets of such PCIFP Company
or such Restricted Subsidiary (including (x) any sale or other disposition of
Equity Interests of any such Restricted Subsidiary and (y) any sale or other
disposition of any noncash consideration received by such PCIFP Company or such
Restricted Subsidiary from any prior transaction or series of related
transactions that constituted a PCIFP Asset Sale hereunder), whether owned on
the date hereof or subsequently acquired, in one transaction or a series of
related transactions; provided, however, that the following will not constitute
PCIFP Asset Sales: (i) transactions (other than transactions described in
clause (y) above) in any calendar year with aggregate cash and/or Fair Market
Value of any other consideration received (including the unconditional
assumption of Indebtedness) of less than
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$1,000,000; (ii) a transaction or series of related transactions that
results in a Change of Control; (iii) any sale of assets of a PCIFP Company and
its Restricted Subsidiaries or merger permitted pursuant to Section 7.2.5; (iv)
any sale or other disposition of inventory, property (whether real, personal or
mixed) or equipment that has become worn out, obsolete or damaged or otherwise
unsuitable or no longer needed for use in connection with the business of a
PCIFP Company or any of its Restricted Subsidiaries, as the case may be, in the
good faith determination of the Board of Directors of such PCIFP Company; and
(v) any sale of inventory to customers in the ordinary and customary course of
business.
"PCI Carolina" is defined in the first recital.
"PCI Closing Date Certificate" means a certificate of an Authorized Officer
of PCI, substantially in the form of Exhibit G-3 hereto, delivered pursuant to
Section 5.11.
"PCIFP Company" means PCICC, PCI Carolina or Pioneer Licensing.
"Pension Plan" means a "pension plan", as such term is defined in section
3(2) of ERISA, which is subject to Title IV of ERISA (other than a
Multiemployer Plan), and to which PAAC or any corporation, trade or business
that is, along with PAAC, an ERISA Affiliate, may have any liability, including
any liability by reason of being deemed to be a contributing sponsor under
section 4069 of ERISA.
"Percentage" means, relative to any Lender, the applicable percentage
relating to Term Loans, as set forth in Schedule II hereto or set forth in the
Lender Assignment Agreement as such percentage may be adjusted from time to
time pursuant to Lender Assignment Agreement(s) executed by such Lender and its
Assignee Lender(s) and delivered pursuant to Section 11.11.
"Permitted Investment" means (i) any Eligible Investment, (ii) any
Investment in PAAC, (iii) Investments in existence on the date hereof and
listed in Item 7.2.3 ("Existing Investments") of the Disclosure Schedule and
any such Investment in Basic Investments, Inc., Basic Land Company, Basic
Management, Inc., Basic Water Company or Victory Valley Land Company, L.P.
which has been reclassified or converted into an alternate form of Investment
in the same or a successor entity, (iv) intercompany notes permitted pursuant
to Section 7.2.1, (v) Investments in any Wholly-Owned Restricted Subsidiary of
PAAC or any Person which, as a result of such Investment, becomes a
Wholly-Owned Restricted Subsidiary of PAAC; provided that such Wholly-Owned
Restricted Subsidiary is engaged in a Related Business, and (vi) other
Investments after the date hereof in joint ventures, corporations, limited
liability companies, partnerships or Unrestricted Subsidiaries engaged in a
Related Business that do not at any one time outstanding exceed $5,000,000;
provided that the amount of Investments pursuant to clause (vi) will be
included in the calculation of Restricted Payments pursuant to Section 7.2.3.
"Permitted Liens" means as of any particular time, any one or more of the
following:
(a) Liens for taxes, rates and assessments or for prior claims
within the meaning of the Civil Code of Quebec not yet past due or, if
past due, the validity of which is being contested in good faith by PAAC
or any of its Restricted Subsidiaries by appropriate proceedings promptly
instituted and diligently conducted and against which PAAC or such
Restricted Subsidiary has established appropriate reserves in accordance
with GAAP;
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(b) the Lien of any judgment rendered which is being contested in
good faith by PAAC or any of its Restricted Subsidiaries by appropriate
proceedings promptly instituted and diligently conducted and against which
PAAC or such Restricted Subsidiary has established appropriate reserves in
accordance with GAAP and which does not have a material adverse effect on
the ability of PAAC and its Restricted Subsidiaries to operate their
business or conduct their operations;
(c) other than in connection with Indebtedness, any Lien arising in
the ordinary course of business (i) to secure payments of workers'
compensation, unemployment insurance, pension or other social security or
retirement benefits, or to secure the performance of bids, tenders,
leases, progress payments, contracts (other than for the payment of money)
or to secure public or statutory obligations of PAAC or any of its
Restricted Subsidiaries, or to secure surety or appeal bonds to which PAAC
or any of its Restricted Subsidiaries is a party, (ii) imposed by law
dealing with materialmen's, suppliers', mechanics', workmen's,
repairmen's, warehousemen's, landlords', vendors' or carriers' Liens
created by law, or deposits or pledges which are not yet due or, if due,
the validity of which is being contested in good faith by PAAC or any of
its Restricted Subsidiaries by appropriate proceedings promptly instituted
and diligently conducted and against which PAAC or such Restricted
Subsidiary has established appropriate reserves in accordance with GAAP,
(iii) rights of financial institutions to setoff, effect compensation, and
chargeback arising by operation of law and (iv) similar Liens;
(d) servitudes, licenses, easements, encumbrances, restrictions,
rights-of-way and rights in the nature of easements or similar charges as
well as encroachments or minor title defects which will not in the
aggregate materially adversely impair the use of the subject property by
PAAC or a Restricted Subsidiary of PAAC;
(e) zoning and building by-laws and ordinances, municipal bylaws and
regulations, and restrictive covenants, which do not materially interfere
with the use of the subject property by PAAC or a Restricted Subsidiary of
PAAC as such property is used as of the date hereof;
(f) any extension, renewal, substitution or replacement (or
successive extensions, renewals, substitutions or replacements), as a
whole or in part, of any of the Liens referred to in clauses (a) through
(e) of this definition or the Indebtedness secured thereby; provided that
(i) such extension, renewal, substitution or replacement Lien is limited
to that portion of the property or assets, now owned or hereafter
acquired, that secured the Lien prior to such extension, renewal,
substitution or replacement Lien and (ii) the Indebtedness secured by such
Lien (assuming all available amounts were borrowed) at such time is not
increased; and
(g) provisos, restrictions, limitations and reservations contained
in any original grants from the Crown, and any statutory limitations,
exceptions, reservations and qualifications which will not in the
aggregate materially adversely impair the use of the subject property by
the Borrower, PAAC or any of their respective Restricted Subsidiaries.
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"Person" means any natural person, corporation, partnership, firm,
association, trust, government, governmental agency, limited liability
company or any other entity, whether acting in an individual, fiduciary or
other capacity.
"Pioneer East" means Pioneer (East), Inc., a Delaware corporation and
direct Wholly-Owned Subsidiary of PAI.
"Pioneer Licensing" is defined in the first recital.
"Plan" means any Pension Plan or Welfare Plan.
"PPSA" means, as the context may require, the Personal Property Security
Act (Ontario), the Personal Property Security Act (New Brunswick) and/or
Personal Property Security Act (Nova Scotia).
"Preferred Stock" means, as applied to the Equity Interests of any
corporation, stock of any class or classes (however designated) which is
preferred over shares of stock of any other class of such corporation as to the
distribution of assets on any voluntary or involuntary liquidation or
dissolution of such corporation or as to dividends.
"Pro Forma Balance Sheets" is defined in clause (d) of Section 5.12.
"Purchase Agreement" is defined in the first recital.
"Quarterly Payment Date" means the last Business Day of each March, June,
September and December, commencing with December, 1997.
"Quebec Mortgage and Security Agreement" means the deed of hypothec
executed and delivered by an Authorized Officer of PCICC pursuant to Section
5.10, substantially in the form of Exhibit E-2 attached hereto, as amended,
supplemented, amended and restated or otherwise modified from time to time.
"Redeemable Stock" means any Equity Interest that by its terms or
otherwise (i) is required to be redeemed prior to June 30, 2007, (ii) matures
or is redeemable, in whole or in part, at the option of PAAC or any Subsidiary
of PAAC or the holder thereof or pursuant to a mandatory sinking fund at any
time prior to June 30, 2007, or (iii) is convertible into or exchangeable for
debt securities which provide for any scheduled payment of principal prior to
June 30, 2007, at the option of the issuer thereof at any time prior to June
30, 2007, until the right to so convert or exchange is irrevocably
relinquished.
"Refinancing" is defined in clause (j) of Section 7.2.1.
"Refinancing Indebtedness" is defined in clause (j) of Section 7.2.1.
"Related Business" means any corporation or other entity engaged in, and
any asset utilized in, the manufacture or distribution of chlorine, caustic
soda, bleach, hydrochloric acid, iron and other chlorides and aluminum sulfate,
and in lines of business reasonably related thereto.
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"Related Party" means, with respect to any Person, any other Person (a)
that directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, such first Person or a
subsidiary of such first Person, (b) that beneficially owns or holds ten
percent (10%) or more of the equity interest of such first Person or a
subsidiary of such first Person or (c) ten percent (10%) or more of the equity
interest of which is beneficially owned or held by such first Person or a
subsidiary of such first Person. The term "control" means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through the ownership of voting
securities, by contract or otherwise.
"Release" means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, or disposing of
any Hazardous Material into the environment (including the abandonment or
discarding of barrels, containers, and other closed receptacles containing any
Hazardous Material), including with respect to any event, occurrence or
incident subject to the jurisdiction of any U.S. federal, state or local
regulatory, enforcement or judicial institution, body or department, any
release as such term is defined in CERCLA.
"Reportable Event" has the meaning given to such term in ERISA.
"Required Lenders" means, at any time, (i) prior to the Closing Date
hereunder, Lenders having at least 51% of the sum of the Term Loan Commitments
and (ii) on and after the Closing Date, Lenders holding at least 51% of the
principal amount of the Term Loans.
"Resource Conservation and Recovery Act" means the Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901, et seq., as in effect from time to
time.
"Restoration" has the meaning specified in each applicable Mortgage.
"Restricted Investment" means any Investment other than a Permitted
Investment.
"Restricted Payment" is defined in Section 7.2.3.
"Restricted Payment Computation Date" is defined in Section 7.2.3.
"Restricted Payment Computation Period" is defined in Section 7.2.3.
"Restricted Subsidiary" means (a) with respect to PAAC, (i) the Borrower
and any PAI Guarantor, (ii) any Subsidiary of PAAC in existence on the date
hereof to which any line of business or division (and the assets associated
therewith) of any PAI Guarantor are transferred after the date hereof, (iii)
any Subsidiary of PAAC organized or acquired after the date hereof, unless such
Subsidiary has been designated as an Unrestricted Subsidiary by a resolution of
the Board of Directors of PAAC as provided in the definition of "Unrestricted
Subsidiary" and (iv) any Unrestricted Subsidiary which is designated as a
Restricted Subsidiary of PAAC by the Board of Directors of PAAC; provided, that
immediately after giving effect to any such designation (A) no Default or Event
of Default has occurred and is continuing and (B) in the case of any
designation referred to in clause (iii) or (iv) hereof, PAAC could incur at
least $1.00 of Indebtedness pursuant to Section 7.2.1, on a pro forma basis
taking into account such designation, and (b) with respect to the Borrower, any
Subsidiary of the Borrower that is a
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Restricted Subsidiary of PAAC. PAAC will evidence any such designation to the
Administrative Agent by promptly filing with the Administrative Agent an
Officers' Certificate certifying that such designation has been made and
complies with the requirements of the immediately preceding sentence.
Notwithstanding any provision herein to the contrary, from and after the
Effective Date, each of the Borrower, and each PAI Guarantor will be, and shall
at all times thereafter be, a Restricted Subsidiary of PAAC.
"Revolving Credit Agreement" means the Loan and Security Agreement dated
as of June 17, 1997, between PAAC and BofA, as agent and lender, and the
lenders named therein, as amended, supplemented, amended and restated or
otherwise modified from time to time in accordance with the provisions hereof
and thereof.
"S&P" means Standard & Poor's Ratings Group, division of McGraw Hill,
Inc.
"Sale and Leaseback Transaction" means, with respect to any Person, any
arrangement with another Person for the leasing of any real or tangible
personal property, which property has been or is to be sold or transferred by
such Person to such other Person in contemplation of such leasing.
"Salomon" is defined in the preamble.
"Secured Parties" means the Collateral Agent, the Lenders, the Agents, the
Trustee, the holders of the Senior Secured Notes and their respective
successors, transferees and assigns.
"Security Agreement" means, as the context may require, the Canadian
Subsidiary Security Agreement and/or the Affiliate Security Agreement.
"Security Documents" means (i) each Mortgage, (ii) each Security
Agreement, (iii) the Intercreditor Agreement, (iv) the documentation relating
to the Intercreditor Collateral Account, and (v) each pledge agreement
delivered pursuant to Section 7.1.9 and each other security agreement,
mortgage, hypothec, deed of trust, pledge, collateral assignment and other
document evidencing or creating any security interest in favor of the
Collateral Agent in all or any portion of the Collateral or delivered in
connection with any of the foregoing, in each case as amended, supplemented,
amended and restated or otherwise modified from time to time.
"Senior Indebtedness" means the principal of, premium, if any, and
interest on any Indebtedness of PAAC or its Restricted Subsidiaries (including
the Borrower and its Restricted Subsidiaries), whether outstanding on the date
hereof or thereafter incurred as permitted herein, unless, in the case of any
particular Indebtedness, the agreement or instrument creating or evidencing the
same or pursuant to which the same is outstanding expressly provides that such
Indebtedness is junior or subordinated in right of payment to any item of
Indebtedness of PAAC or its Restricted Subsidiaries. Without limiting the
generality of the foregoing, "Senior Indebtedness" includes the principal of,
premium, if any, and interest and all other obligations of every nature of the
Borrower (or any other Obligor) from time to time owed under the Term Facility.
Notwithstanding the foregoing, "Senior Indebtedness" does not include (i) in
the case of the obligation of the Borrower in respect of each Term Note, the
obligation of the Borrower in respect of the other Term Notes, (ii) any
liability for foreign, federal, state, provincial, local or other taxes owed or
owing by PAAC or any of its Restricted Subsidiaries to the extent that such
liability constitutes Indebtedness, (iii) Indebtedness of the Borrower (or any
other Obligor) to
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PAAC or any Restricted Subsidiary of PAAC, (iv) that portion of any
Indebtedness which at the time of issuance is issued in violation hereof and
(v) Indebtedness and amounts incurred in connection with obtaining goods,
materials or services in the ordinary course of business (other than such
Indebtedness which is owed to banks and other financial institutions or secured
by the goods or materials which were purchased with such Indebtedness).
"Senior Secured Note Indenture" means the Indenture dated as of October
30, 1997, among PCICC, the guarantors party thereto and United States Trust
Company of New York, as Trustee, as the same may be amended, restated, amended
and restated or otherwise modified from time to time in accordance with the
terms hereof and thereof.
"Senior Secured Note Offering" is defined in the second recital.
"Senior Secured Notes" means the 9 1/4% Senior Secured Notes due 2007 of
PCICC issued pursuant to the Senior Secured Note Offering and the Senior
Secured Note Indenture, including any senior secured notes of PCICC with
substantially identical terms exchanged therefor pursuant to a registration
statement under the Securities Act of 1933, as amended.
"St. Xxxxxxx Pipeline" means the approximately seven-mile liquid chlorine
pipeline to be constructed by PCAC from its plant in St. Xxxxxxx, Louisiana to
Geismar, Louisiana, including all leak and excavation detection systems and all
other equipment, fixtures, improvements, licenses, permits, approvals,
warranties, contract rights, leases, access agreements and other real property
interests owned or acquired by PCAC in connection therewith (not including any
"Mortgaged Property" as such term is defined in the Existing Term Loan
Agreement), together with all insurance proceeds and condemnation awards
related thereto and all rents, issues, profits and proceeds thereof.
"Stated Maturity Date" means, in the case of all Term Loans, December 5,
2006.
"Subordinated Indebtedness" means Indebtedness of the Borrower or any PAI
Guarantor subordinated in right of payment to the Obligations.
"Subsidiary" means, with respect to any Person, (i) any corporation of
which the outstanding Capital Stock having at least a majority of the votes
entitled to be cast in the election of directors, under ordinary circumstances,
is at the time owned, directly or indirectly, by such Person, by such Person
and one or more of its Subsidiaries or by one or more of such Person's
Subsidiaries or (ii) any other Person of which at least a majority of voting
interest, under ordinary circumstances, is at the time owned, directly or
indirectly, by such Person, by such Person and one or more of its Subsidiaries
or by one or more of such Person's Subsidiaries.
"Substantial Shareholder" means each of (i) Xxxxxxx X. Xxxxxxx and his
Affiliates and/or (ii) Interlaken Capital, Inc. and its Affiliates.
"Syndication Agent" is defined in the preamble and includes each other
Person as shall have subsequently been appointed as the successor Syndication
Agent pursuant to Section 10.5.
"Target Business" is defined in the first recital.
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"Tax Sharing Agreement" means the Tax Sharing Agreement, dated as of April
20, 1995, among PCI and its Subsidiaries.
"Taxes" is defined in Section 4.6.
"TCH" means T.C. Holdings, Inc., a New Mexico corporation and direct
Wholly-Owned Subsidiary of All-Pure.
"Term Facility" is defined in the third recital.
"Term Loan" is defined in Section 2.1.1.
"Term Loan Commitment" is defined in Section 2.1.1.
"Term Loan Commitment Amount" means $100,000,000.
"Term Loan Commitment Termination Date" means the earliest of (i) December
31, 1997, if the Term Loans have not been made on or prior to such date, (ii)
the Closing Date (immediately after the making of the Term Loans on such date),
and (iii) the date on which any Commitment Termination Event occurs.
"Term Note" means a promissory note of the Borrower payable to the order
of any Lender, in the form of Exhibit A hereto (as such promissory note may be
amended, endorsed or otherwise modified from time to time), evidencing the
aggregate Indebtedness of the Borrower to such Lender resulting from
outstanding Term Loans, and also means all other promissory notes accepted from
time to time in substitution therefor or renewal thereof.
"Transaction" is defined in the second recital.
"Transaction Documents" means each of the Acquisition Agreements, the
Senior Secured Note Indenture, the form of Senior Secured Note and all other
agreements, documents, instruments, certificates, filings, consents, approvals,
board of directors resolutions and opinions furnished pursuant to or in
connection with the Acquisition, the Senior Secured Note Offering and the
transactions contemplated hereby or thereby, each as amended, supplemented,
amended and restated or otherwise modified from time to time as permitted in
accordance with the terms hereof, of any other Loan Document and thereof.
"Trust Moneys" means all cash or Eligible Investments received by the
Collateral Agent: (a) in exchange for the release of property from the Lien of
any of the Security Documents; (b) as compensation for or proceeds of the sale
of all or any part of the Collateral taken by eminent domain or purchased by,
or sold pursuant to any order of, a governmental authority or otherwise
disposed of; (c) as proceeds of insurance upon any, all or part of the
Collateral (other than any liability insurance proceeds payable to the
Collateral Agent for any loss, liability or expense incurred by it); (d) as
proceeds of any other sale or other disposition of all or any part of the
Collateral by or on behalf of either of the Collateral Agent or any collection,
recovery, receipt, appropriation or other realization of or from all or any
part of the Collateral pursuant to the Security Documents or otherwise; or (e)
for application under this Agreement as provided in this Agreement or any other
Security Document, or whose disposition is not otherwise specifically provided
for in this Agreement or in any other Security Document.
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"Trustee" means United States Trust Company of New York, in its capacity
as "trustee" under the Senior Secured Note Indenture, and each successor
trustee thereunder to become such pursuant to the applicable provisions
thereof.
"type" means, relative to any Term Loan, the portion thereof, if any,
being maintained as a Base Rate Loan or a LIBO Rate Loan.
"UCC" means the Uniform Commercial Code as in effect from time to time in
the State of New York.
"United States" or "U.S." means the United States of America, its fifty
states and the District of Columbia.
"Unrestricted Subsidiary" means, until such time as it may be designated
as a Restricted Subsidiary by the Board of Directors of PAAC as provided in and
in compliance with the definition of "Restricted Subsidiary," (i) any
Subsidiary of PAAC organized or acquired after the date hereof designated as an
Unrestricted Subsidiary by the Board of Directors of PAAC in which all
investments by PAAC or any Restricted Subsidiary of PAAC are made only from
funds available for the making of Restricted Payments pursuant to Section 7.2.3
and (ii) any Subsidiary of an Unrestricted Subsidiary. The Board of Directors
of PAAC may designate any Subsidiary of PAAC (including any newly acquired or
newly formed Subsidiary) to be an Unrestricted Subsidiary unless such
Subsidiary owns any Equity Interests of, or owns, or holds any Lien upon, any
property of, any Subsidiary of PAAC which is not a Subsidiary of such
Subsidiary to be so designated; provided that (w) each Subsidiary to be so
designated and each of its Subsidiaries has not, at the time of designation,
and does not thereafter, directly or indirectly, incur any Indebtedness
pursuant to which the lender with respect thereto has recourse to any of the
assets of PAAC or any of its Restricted Subsidiaries, (x) immediately after
giving effect to such designation no Default or Event of Default shall have
occurred and be continuing, (y) all outstanding Investments by PAAC and its
Restricted Subsidiaries (except to the extent repaid in cash) in the Subsidiary
so designated will be deemed to be Restricted Payments at the time of such
designation equal in amount to the Fair Market Value of such Investments at the
time of such designation and would be Restricted Payments permitted to be paid
pursuant to the provisions of Section 7.2.3 and (z) the amount of such
Restricted Payments will be included in the calculation of the amount of
Restricted Payments previously made pursuant to such covenant. PAAC will
evidence any such designation by promptly filing with the Administrative Agent
an Officers' Certificate certifying that such designation has been made and
complies with the requirements of the immediately preceding sentence. Each
Unrestricted Subsidiary that is a Subsidiary of the Borrower shall be deemed to
be an Unrestricted Subsidiary of the Borrower.
"U.S. Bankruptcy Law" means chapter 11 of Title 11 of the United States
Code, as amended, or any similar United States federal or state law relating to
bankruptcy, insolvency, receivership, winding-up, liquidation, reorganization
or relief of debtors or any amendment to, succession to or change in any such
law.
"U.S. Environmental Laws" means all applicable U.S. federal, state or
local statutes, laws, ordinances, codes, rules, regulations and guidelines
(including consent decrees and administrative orders) relating to the
protection and conservation of the environment concerning any hazardous, toxic
or dangerous waste, substance or constituent, or any pollutant or contaminant.
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"U.S. Hazardous Materials" means any toxic substance, hazardous substance,
hazardous material, hazardous chemical or hazardous waste defined or qualifying
as such in (or for the purposes of) any U.S. Environmental Law, or any
pollutant or contaminant, and shall include, but not be limited to, petroleum,
including crude oil, any radioactive material, including any source, special
nuclear or by-product material as defined at 42 U.S.C. Section 2011 et seq., as
amended or hereafter amended, polychlorinated biphenyls and asbestos in any
form or condition.
"U.S. Seller" is defined in the first recital.
"U.S. Subsidiary" means any Subsidiary of the Borrower that is
incorporated or organized in or under the laws of the United States or any
state thereof.
"Voting Stock" of any Person means Capital Stock of such Person which
ordinarily has voting power for the election of directors (or Persons
performing similar functions) of such Person, whether at all times or only so
long as no senior class of securities has such voting power by reason of any
contingency.
"Wholly-Owned Subsidiary" means, with respect to any Person, any
Subsidiary of such Person all of the Capital Stock (and all rights and options
to purchase such Capital Stock) of which, other than directors' qualifying
shares, are owned, beneficially and of record, by such Person and/or one or
more Wholly-Owned Subsidiaries of such Person.
"Wholly-Owned Restricted Subsidiary" means, with respect to any Person, a
Restricted Subsidiary of such Person all of the outstanding Capital Stock or
other ownership interests of which (other than capital stock constituting
directors' qualifying shares or interests held by directors or shares or
interests required to be held by foreign nationals, to the extent mandated by
applicable law) are owned by such Person or by one or more Wholly-Owned
Restricted Subsidiaries of such Person.
SECTION 1.2. Use of Defined Terms. Unless otherwise defined or the
context otherwise requires, terms for which meanings are provided in this
Agreement shall have such meanings when used in the Disclosure Schedule and in
each other Loan Document, notice and other communication delivered from time to
time in connection with this Agreement or any other Loan Document.
SECTION 1.3. Cross-References. Unless otherwise specified, references in
this Agreement and in each other Loan Document to any Article or Section are
references to such Article or Section of this Agreement or such other Loan
Document, as the case may be, and, unless otherwise specified, references in
any Article, Section or definition to any clause are references to such clause
of such Article, Section or definition.
SECTION 1.4. Accounting and Financial Determinations. Unless otherwise
specified, all accounting terms used herein or in any other Loan Document shall
be interpreted, all accounting determinations and computations hereunder or
thereunder shall be made, and all financial statements required to be delivered
hereunder or thereunder shall be prepared in accordance with, those generally
accepted accounting principles ("GAAP"), as in effect from time to time in the
United States and, unless otherwise expressly provided herein, shall be
computed or determined on a consolidated basis and without duplication.
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SECTION 1.5. Use of UCC Terms. Unless the context otherwise requires,
the terms "accounts receivable", "inventory" and "general intangibles" shall
have the meanings ascribed thereto in the UCC.
SECTION 1.6. Officers' Certificates and Opinions. Every Officers'
Certificate or Opinion of Counsel with respect to compliance with a condition
or covenant provided for in this Agreement or any other Loan Document shall be
addressed to the Administrative Agent and each of the Lenders and shall
include:
(a) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinion contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Absent any actual knowledge to the contrary, the Administrative Agent may rely
on any such certificate without further inquiry.
ARTICLE II
COMMITMENTS, BORROWING PROCEDURES AND NOTES
SECTION 2.1. Commitments. On the terms and subject to the conditions of
this Agreement (including Article V), each Lender severally agrees to make Term
Loans pursuant to the Term Loan Commitments described in this Section 2.1.
SECTION 2.1.1. Term Loan Commitments. On the Closing Date, which shall
be a Business Day occurring prior to the Term Loan Commitment Termination Date,
each Lender will make loans (relative to such Lender, its "Term Loans") to the
Borrower equal to such Lender's Percentage of the aggregate amount of the
Borrowing of Term Loans requested by the Borrower to be made on such day with
the commitment of each such Lender to make the Term Loans described in this
Section referred to as its "Term Loan Commitment". No amounts paid or prepaid
with respect to any Term Loans may be reborrowed.
SECTION 2.1.2. Lenders Not Permitted or Required to Make the Term Loans.
No Lender shall be permitted or required to, and the Borrower shall not request
any Lender to, make any Term Loan on the Closing Date if, after giving effect
thereto, the aggregate original principal amount of all the Term Loans
(a) of all Lenders would exceed the Term Loan Commitment Amount, or
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(b) of such Lender would exceed such Lender's Percentage of the Term
Loan Commitment Amount.
SECTION 2.2. Borrowing Procedures and Funding Maintenance. By delivering
a Borrowing Request to the Administrative Agent on or before 10:00 a.m.
(Chicago time) on a Business Day, the Borrower may request, on not less than
one Business Day's notice (in the case of Base Rate Loans) or three Business
Days' notice (in the case of LIBO Rate Loans), that a Borrowing be made on the
Closing Date. On the terms and subject to the conditions of this Agreement,
each Borrowing shall be comprised of the type of Term Loans, and shall be made
on the Business Day, specified in such Borrowing Request. On or before 11:00
a.m. (Chicago time) on such Business Day each Lender shall deposit with the
Administrative Agent same day funds in an amount equal to such Lender's
Percentage of the requested Borrowing. Such deposit will be made to an account
which the Administrative Agent shall specify from time to time by notice to the
Lenders. To the extent funds are received from the Lenders, the Administrative
Agent shall make such funds available to the Borrower by wire transfer to the
accounts the Borrower shall have specified in its Borrowing Request. No
Lender's obligation to make any Term Loan shall be affected by any other
Lender's failure to make any Term Loan.
SECTION 2.3. Continuation and Conversion Elections. By delivering a
Continuation/Conversion Notice to the Administrative Agent on or before 10:00
a.m. (Chicago time) on a Business Day, the Borrower may from time to time
irrevocably elect, on not less than one Business Day's notice (in the case of a
conversion of LIBO Rate Loans to Base Rate Loans) or three Business Days'
notice (in the case of a continuation of LIBO Rate Loans or a conversion of
Base Rate Loans into LIBO Rate Loans) nor more than five Business Days' notice
that all, or any portion in a minimum amount of $5,000,000 or any larger
integral multiple of $250,000, be, in the case of Base Rate Loans, converted
into LIBO Rate Loans or a minimum amount of $250,000 or any larger integral
multiple of $250,000, in the case of LIBO Rate Loans, converted into Base Rate
Loans or continued as LIBO Rate Loans (in the absence of delivery of a
Continuation/Conversion Notice with respect to any LIBO Rate Loan at least
three Business Days before the last day of the then current Interest Period
with respect thereto, such LIBO Rate Loan shall, on such last day,
automatically convert to a Base Rate Loan); provided, however, that (x) each
such conversion or continuation shall be pro rated among the applicable
outstanding Term Loans of all Lenders, and (y) no portion of the outstanding
principal amount of any Term Loans may be continued as, or be converted into,
LIBO Rate Loans when any Default has occurred and is continuing.
SECTION 2.4. Funding. Each Lender may, if it so elects, fulfill its
obligation to make, continue or convert LIBO Rate Loans hereunder by causing
one of its foreign branches or Affiliates (or an international banking facility
created by such Lender) to make or maintain such LIBO Rate Loan; provided,
however, that such LIBO Rate Loan shall nonetheless be deemed to have been made
and to be held by such Lender, and the obligation of the Borrower to repay such
LIBO Rate Loan shall nevertheless be to such Lender for the account of such
foreign branch, Affiliate or international banking facility. In addition, the
Borrower hereby consents and agrees that, for purposes of any determination to
be made for purposes of Section 4.1, 4.2, 4.3 or 4.4, it shall be conclusively
assumed that each Lender elected to fund all LIBO Rate Loans by purchasing
Dollar deposits in its LIBOR Office's interbank eurodollar market.
SECTION 2.5. Term Notes. Each Lender's Term Loans under its Term Loan
Commitment shall be evidenced by a Term Note payable to the order of such
Lender in a
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maximum principal amount equal to such Lender's Percentage of the original Term
Loan Commitment Amount. The Borrower hereby irrevocably authorizes each Lender
to make (or cause to be made) appropriate notations on the grid attached to
such Lender's Term Note (or on any continuation of such grid), which notations,
if made, shall evidence, inter alia, the date of, the outstanding principal
amount of, and the interest rate and Interest Period applicable to the Term
Loans evidenced thereby. Such notations shall be conclusive and binding on the
Borrower absent manifest error; provided, however, that the failure of any
Lender to make any such notations shall not limit or otherwise affect any
Obligations of the Borrower or any other Obligor.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments; Application.
SECTION 3.1.1. Repayments and Prepayments. The Borrower shall repay in
full the unpaid principal amount of each Term Loan upon the Stated Maturity
Date therefor. Prior thereto, the Borrower
(a) may, from time to time on any Business Day, make a voluntary
prepayment, in whole or in part, of the outstanding principal amount of
any Term Loans; provided, however, that
(i) any such prepayment shall be made pro rata among Term Loans
of the same type and, if applicable, having the same Interest Period
of all Lenders;
(ii) the Borrower shall comply with Section 4.4 in the event
that any LIBO Rate Loan is prepaid on any day other than the last day
of the Interest Period for such Term Loan;
(iii) all such voluntary prepayments shall require at least one
Business Day's notice in the case of Base Rate Loans and three
Business Days' notice in the case of LIBO Rate Loans, but no more
than five Business Days' notice, in each case in writing to the
Administrative Agent; and
(iv) all such voluntary partial prepayments shall be, in the
case of LIBO Rate Loans, in an aggregate minimum amount of $5,000,000
or any larger integral multiple of $1,000,000 and, in the case of
Base Rate Loans, in an aggregate minimum amount of $1,000,000 or any
larger integral multiple of $500,000 or in the aggregate principal
amount of all Term Loans of the type then outstanding; and
(v) any voluntary prepayment of Term Loans made on or prior to
the third anniversary of the Closing Date shall be subject to the
payment of a premium, as set forth below:
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(A) 3.0% of the principal amount of Term Loans
prepaid pursuant to this clause (a) of this Section 3.1.1
on or prior to the first anniversary of the Closing Date;
(B) 2.0% of the principal amount of Term Loans
prepaid pursuant to this clause (a) of this Section 3.1.1
subsequent to the first anniversary and prior to or on the
second anniversary of the Closing Date; and
(C) 1.0% of the principal amount of Term Loans
prepaid pursuant to this clause (a) of this Section 3.1.1
subsequent to the second anniversary and prior to or on the
third anniversary of the Closing Date.
(b) shall, make a mandatory prepayment of the Term Loans on account
of Net Proceeds in accordance with Section 7.2.6;
(c) shall, (i) on each Quarterly Payment Date occurring on or during
any period set forth below, make a scheduled repayment of the aggregate
outstanding principal amount, if any, of all Term Loans in an amount equal
to the amount set forth below opposite such period, and (ii) on the Stated
Maturity Date, make a scheduled repayment of the outstanding principal
amount of all Term Loans in the amount set forth opposite such date below
(in each case as such amounts may have otherwise been reduced pursuant to
this Agreement):
SCHEDULED
QUARTERLY
PRINCIPAL
PERIOD REPAYMENT
------------------ ---------
Closing Date to
(and including)
December 31, 1997 $250,000
January 1, 1998 to
(and including)
December 31, 2005 $250,000
January 1, 2006 to
(and including)
September 30, 2006 $250,000
Stated Maturity
Date $91,000,000
(d) shall, subject to Section 3.1.2, make a mandatory prepayment
of the Term Loans upon the occurrence of a Change of Control; and
(e) shall, immediately upon the acceleration of the Stated
Maturity Date of any Term Loans pursuant to Section 8.2 or Section
8.3, repay all outstanding Term Loans, unless, pursuant to Section
8.3, only a portion of all Term Loans are so accelerated (in which
case the portion so accelerated shall be so prepaid).
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Each prepayment of any Term Loans made pursuant to this Section shall be
without premium or penalty, except as may be required by clause (a)(v) of
this Section and/or Section 4.4.
SECTION 3.1.2. Application. Amounts prepaid and repaid shall be applied
as set forth in this Section.
(a) Subject to clauses (b) and (c) below, each prepayment or
repayment of principal of the Term Loans shall be applied, to the extent
of such prepayment or repayment, first, to the principal amount thereof
being maintained as Base Rate Loans, and second, to the principal amount
thereof being maintained as LIBO Rate Loans.
(b) Each prepayment of any Term Loans made pursuant to clause (a) of
Section 3.1.1 shall be applied, to the extent of such prepayment, in the
inverse order of the scheduled repayments of such Term Loans, as set forth
in clause (c) of Section 3.1.1 with respect to such Term Loans.
(c) Each prepayment of Term Loans made pursuant to clause (b) or
clause (d) of Section 3.1.1 shall be applied to the outstanding principal
amount of all Term Loans, except that, (i) with respect to the amount of
any such prepayment, the Administrative Agent will as soon as is
practicable (but in any event no later than the date on which the Borrower
has provided such prepayment to the Administrative Agent) provide notice
of such prepayment to each Lender prior to the distribution of the funds
from such prepayment, and (ii) each Lender will have the right to refuse
any such prepayment by giving written notice of such refusal to the
Administrative Agent within three Business Days after such Lender's
receipt of notice from the Administrative Agent of such prepayment. In
addition, any prepayment of Term Loans shall be applied to the remaining
amortization payments in the inverse order of the scheduled repayments of
such Term Loans, as set forth in clause (c) of Section 3.1.1 with respect
to such Term Loans.
SECTION 3.2. Interest Provisions. Interest on the outstanding principal
amount of the Term Loans shall accrue and be payable in accordance with this
Section 3.2.
SECTION 3.2.1. Rates. Each Base Rate Loan shall accrue interest on the
unpaid principal amount thereof for each day from and including the day upon
which such was made or converted to a Base Rate Loan to but excluding the date
such Term Loan is repaid or converted to a LIBO Rate Loan at a rate per annum
equal to the sum of the Alternate Base Rate for such day plus the Applicable
Margin for such Term Loan on such day. Each LIBO Rate Loan shall accrue
interest on the unpaid principal amount thereof for each day during each
Interest Period applicable thereto at a rate per annum equal to the sum of the
LIBO Rate (Reserve Adjusted) for such Interest Period plus the Applicable
Margin for such Term Loan on such day. All LIBO Rate Loans shall bear interest
from and including the first day of the applicable Interest Period to (but not
including) the last day of such Interest Period at the interest rate determined
as applicable to such LIBO Rate Loan.
SECTION 3.2.2. Post-Maturity Rates. Upon the occurrence and continuance
of (i) any Default described in Section 8.1.1 or (ii) any Event of Default
which shall remain uncured for thirty days (without giving effect to any grace
period therefor), all Term Loans shall bear, and the Borrower shall pay, but
only to the extent permitted by law, interest (after as well as before
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judgment) thereon at a rate per annum equal to the rate that would
otherwise be applicable to such Term Loans pursuant to Section 3.2.1 plus 2.0%.
SECTION 3.2.3. Payment Dates. Interest accrued on each Term Loan shall
be payable, without duplication:
(a) on the Stated Maturity Date therefor;
(b) on the date of any payment or prepayment, in whole or in part,
of principal outstanding on such Term Loan;
(c) with respect to Base Rate Loans, on each Quarterly Payment Date
occurring after the Closing Date;
(d) with respect to LIBO Rate Loans, on the last day of each
applicable Interest Period (and, if such Interest Period shall exceed
three months, at intervals of three months after the first day of such
Interest Period);
(e) with respect to the principal amount of any Base Rate Loans
converted into LIBO Rate Loans on a day when interest would not otherwise
have been payable pursuant to clause (c), on the date of such conversion;
and
(f) on that portion of any Term Loans the Stated Maturity Date of
which is accelerated pursuant to Section 8.2 or Section 8.3, immediately
upon such acceleration.
Interest accrued on Term Loans or other monetary Obligations arising under this
Agreement or any other Loan Document after the date such amount is due and
payable (whether on the Stated Maturity Date, upon acceleration or otherwise)
shall be payable upon demand.
SECTION 3.3. Fees. The Borrower agrees to pay the fees set forth in this
Section 3.3. All such fees shall be non-refundable.
SECTION 3.3.1. Arrangement, Structuring and Commitment Fees. In
accordance with the Fee Letter, PAAC shall, or shall cause the Borrower to, pay
on the Effective Date to each of the Arranger, the Syndication Agent and the
Documentation Agent for its account their applicable portion of the arrangement
and structuring fee referred to therein and, for the account of the Arranger,
the commitment fee referred to therein.
SECTION 3.3.2. Administrative Agent Fee. The Borrower agrees to pay an
annual administration fee to the Administrative Agent, for its own account, in
the amounts mutually agreed to between the Borrower and the Administrative
Agent, payable in advance on the Closing Date and annually thereafter.
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ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 4.1. LIBO Rate Lending Unlawful. If any Lender
shall determine (which determination shall, upon notice thereof to the Borrower
and the Lenders, be conclusive and binding on the Borrower) that the
introduction of or any change in or in the interpretation of any law makes it
unlawful, or any central bank or other governmental authority asserts that it
is unlawful, for such Lender to make, continue or maintain any Term Loan as, or
to convert any Term Loan into, a LIBO Rate Loan of a certain type, the
obligations of all Lenders to make, continue, maintain or convert any such Term
Loans shall, upon such determination, forthwith be suspended until such Lender
shall notify the Administrative Agent that the circumstances causing such
suspension no longer exist, and all LIBO Rate Loans of such type shall
automatically convert into Base Rate Loans at the end of the then current
Interest Periods with respect thereto or sooner, if required by such law or
assertion.
SECTION 4.2. Deposits Unavailable. If the Administrative Agent shall
have determined that (i) Dollar deposits in the relevant amount and for the
relevant Interest Period are not available to the Administrative Agent in its
relevant market, or (ii) by reason of circumstances affecting the
Administrative Agent's relevant market, adequate means do not exist for
ascertaining the interest rate applicable hereunder to LIBO Rate Loans, then,
upon notice from the Administrative Agent to the Borrower and the Lenders, the
obligations of all Lenders under Section 2.3 and Section 2.4 to make or
continue any Term Loans as, or to convert any Term Loans into, LIBO Rate Loans
shall forthwith be suspended until the Administrative Agent shall notify the
Borrower and the Lenders that the circumstances causing such suspension no
longer exist.
SECTION 4.3. Increased LIBO Rate Loan Costs, etc. The Borrower agrees to
reimburse each Lender for any increase in the cost to such Lender of, or any
reduction in the amount of any sum receivable by such Lender in respect of,
making, continuing or maintaining (or of its obligation to make, continue or
maintain) any Term Loans as, or of converting (or of its obligation to convert)
any Term Loans into, LIBO Rate Loans. Such Lender shall promptly notify the
Administrative Agent and the Borrower in writing of the occurrence of any such
event, such notice to state, in reasonable detail, the reasons therefor and the
additional amount required fully to compensate such Lender for such increased
cost or reduced amount. Such additional amounts shall be payable by the
Borrower directly to such Lender within five days of its receipt of such
notice, and such notice shall, in the absence of manifest error, be conclusive
and binding on the Borrower.
SECTION 4.4. Funding Losses. In the event any Lender shall incur any
loss or expense (including any loss or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by such Lender
to make, continue or maintain any portion of the principal amount of any Term
Loan as, or to convert any portion of the principal amount of any Term Loan
into, a LIBO Rate Loan) as a result of (i) any conversion or repayment or
prepayment of the principal amount of any LIBO Rate Loans on a date other than
the scheduled last day of the Interest Period applicable thereto, whether
pursuant to Section 3.1 or otherwise, (ii) Borrower's failure to borrow any
Term Loans as LIBO Rate Loans in accordance with the Borrowing Request
therefor, or (iii) Borrower's failure to continue, or to convert Base Rate
Loans into LIBO Rate Loans in accordance with the Continuation/Conversion
Notice therefor,
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then, upon the written notice of such Lender to the Borrower (with a copy to
the Administrative Agent), the Borrower shall, within five days of its receipt
thereof, pay directly to such Lender such amount as will (in the reasonable
determination of such Lender) reimburse such Lender for such loss or expense.
Such written notice (which shall include calculations in reasonable detail)
shall, in the absence of manifest error, be conclusive and binding on the
Borrower.
SECTION 4.5. Increased Capital Costs. If any change in, or the
introduction, adoption, effectiveness, interpretation, reinterpretation or
phase-in of, any law or regulation, directive, guideline, decision or request
(whether or not having the force of law) of any court, central bank, regulator
or other governmental authority affects or would affect the amount of capital
required or expected to be maintained by any Lender or any Person controlling
such Lender, and such Lender determines (in its sole and absolute discretion)
that the rate of return on its or such controlling Person's capital as a
consequence of its Term Loan Commitment or the Term Loans made by such Lender
is reduced to a level below that which such Lender or such controlling Person
could have achieved but for the occurrence of any such circumstance, then, in
any such case upon notice from time to time by such Lender to the Borrower, the
Borrower shall immediately pay directly to such Lender additional amounts
sufficient to compensate such Lender or such controlling Person for such
reduction in rate of return. A statement of such Lender as to any such
additional amount or amounts (including calculations thereof in reasonable
detail) shall, in the absence of manifest error, be conclusive and binding on
the Borrower. In determining such amount, such Lender may use any method of
averaging and attribution that it (in its sole and absolute discretion) shall
deem applicable.
SECTION 4.6. Taxes. All payments by the Borrower of principal of, and
interest on, the Term Loans and all other amounts payable hereunder shall be
made free and clear of and without deduction for any present or future income,
excise, stamp or franchise taxes and other taxes, fees, duties, withholdings or
other charges of any nature whatsoever imposed by any taxing authority, but
excluding franchise taxes and taxes imposed on or measured by any Lender's net
income or receipts (such non-excluded items being called "Taxes"). In the
event that any withholding or deduction from any payment to be made by the
Borrower hereunder is required in respect of any Taxes pursuant to any
applicable law, rule or regulation, then the Borrower will
(a) pay directly to the relevant authority the full amount required
to be so withheld or deducted;
(b) promptly forward to the Administrative Agent an official receipt
or other documentation satisfactory to the Administrative Agent evidencing
such payment to such authority; and
(c) pay to the Administrative Agent for the account of the Lenders
such additional amount or amounts as is necessary to ensure that the net
amount actually received by each Lender will equal the full amount such
Lender would have received had no such withholding or deduction been
required.
Moreover, if any Taxes are directly asserted against the Administrative Agent
or any Lender with respect to any payment received by the Administrative Agent
or such Lender hereunder, the Administrative Agent or such Lender may pay such
Taxes and the Borrower will promptly pay such additional amounts (including any
penalties, interest or expenses) as is necessary in order that the net amount
received by such person after the payment of such Taxes (including any
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Taxes on such additional amount) shall equal the amount such person would have
received had not such Taxes been asserted.
If the Borrower fails to pay any Taxes when due to the appropriate taxing
authority or fails to remit to the Administrative Agent, for the account of the
respective Lenders, the required receipts or other required documentary
evidence, the Borrower shall indemnify the Lenders for any incremental Taxes,
interest or penalties that may become payable by any Lender as a result of any
such failure. For purposes of this Section 4.6, a distribution hereunder by the
Administrative Agent or any Lender to or for the account of any Lender shall be
deemed a payment by the Borrower.
Upon the request of the Borrower or the Administrative Agent, each Lender
that is organized under the laws of a jurisdiction other than the United States
shall, prior to the due date of any payments under the Term Notes, execute and
deliver to the Borrower and the Administrative Agent, on or before the first
scheduled payment date in each Fiscal Year, one or more (as the Borrower or the
Administrative Agent may reasonably request) United States Internal Revenue
Service Forms 4224 or Forms 1001 or such other forms or documents (or successor
forms or documents), appropriately completed, as may be applicable to establish
the extent, if any, to which a payment to such Lender is exempt from
withholding or deduction of Taxes.
SECTION 4.7. Payments, Computations, etc. Unless otherwise expressly
provided, all payments by or on behalf of the Borrower pursuant to this
Agreement, the Term Notes or any other Loan Document shall be made by the
Borrower to the Administrative Agent for the pro rata account of the Lenders,
Agents or Arranger, as applicable, entitled to receive such payment. All such
payments required to be made to the Administrative Agent shall be made, without
setoff, deduction or counterclaim, not later than 11:00 a.m. (Chicago time) on
the date due, in same day or immediately available funds, to such account as
the Administrative Agent shall specify from time to time by notice to the
Borrower. Funds received after that time shall be deemed to have been received
by the Administrative Agent on the next succeeding Business Day. The
Administrative Agent shall promptly remit in same day funds to each Lender,
Agent or Arranger, as the case may be, its share, if any, of such payments
received by the Administrative Agent for the account of such Lender, Agent or
Arranger, as the case may be. All interest and fees shall be computed on the
basis of the actual number of days (including the first day but excluding the
last day) occurring during the period for which such interest or fee is payable
over a year comprised of 360 days (or, in the case of interest on a Base Rate
Loan that is not calculated at the Federal Funds Rate, 365 days or, if
appropriate, 366 days). Whenever any payment to be made shall otherwise be due
on a day which is not a Business Day, such payment shall (except as otherwise
required by clause (i) of the definition of the term "Interest Period" with
respect to LIBO Rate Loans) be made on the next succeeding Business Day and
such extension of time shall be included in computing interest and fees, if
any, in connection with such payment.
SECTION 4.8. Sharing of Payments. If any Lender shall obtain any payment
or other recovery (whether voluntary, involuntary, by application of setoff or
otherwise) on account of any Term Loan (other than pursuant to the terms of
Sections 4.3, 4.4 and 4.5) in excess of its pro rata share of payments then or
therewith obtained by all Lenders entitled thereto, such Lender shall purchase
from the other Lenders such participations in the Term Loans made by them as
shall be necessary to cause such purchasing Lender to share the excess payment
or other recovery ratably with each of them; provided, however, that if all or
any portion of the excess payment or other
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recovery is thereafter recovered from such purchasing Lender, the purchase
shall be rescinded and each Lender which has sold a participation to the
purchasing Lender shall repay to the purchasing Lender the purchase price to
the ratable extent of such recovery together with an amount equal to such
selling Lender's ratable share (according to the proportion of (i) the amount
of such selling Lender's required repayment to the purchasing Lender in respect
of such recovery, to (ii) the total amount so recovered from the purchasing
Lender) of any interest or other amount paid or payable by the purchasing
Lender in respect of the total amount so recovered. The Borrower agrees that
any Lender so purchasing a participation from another Lender pursuant to this
Section may, to the fullest extent permitted by law, exercise all its rights of
payment (including pursuant to Section 4.9) with respect to such participation
as fully as if such Lender were the direct creditor of the Borrower in the
amount of such participation. If under any applicable bankruptcy, insolvency
or other similar law, any Lender receives a secured claim in lieu of a setoff
to which this Section applies, such Lender shall, to the extent practicable,
exercise its rights in respect of such secured claim in a manner consistent
with the rights of the Lenders entitled under this Section to share in the
benefits of any recovery on such secured claim.
SECTION 4.9. Setoff. Each Lender shall, upon the occurrence of any Event
of Default described in clause (a), (b) or (c) of Section 8.1.9 with respect to
any Obligor or, with the consent of the Required Lenders, upon the occurrence
of any other Event of Default, to the fullest extent permitted by law, have the
right to appropriate and apply to the payment of the Obligations then owing to
it (whether or not then due), and (as security for such Obligations) the
Borrower hereby grants to each Lender a continuing security interest in, any
and all balances, credits, deposits, accounts or moneys of the Borrower then or
thereafter maintained with or otherwise held by such Lender; provided, however,
that any such appropriation and application shall be subject to the provisions
of Section 4.8. Each Lender agrees promptly to notify the Borrower and the
Administrative Agent after any such setoff and application made by such Lender;
provided, however, that the failure to give such notice shall not affect the
validity of such setoff and application. The rights of each Lender under this
Section are in addition to other rights and remedies (including other rights of
setoff under applicable law or otherwise) which such Lender may have.
ARTICLE V
CONDITIONS TO TERM LOAN EXTENSION
The obligation of each Lender to fund its Term Loans shall be subject to
the prior or concurrent satisfaction of each of the conditions precedent set
forth in this Article V.
SECTION 5.1. Resolutions, etc. The Arranger, the Syndication Agent and
the Administrative Agent shall have received from each Obligor a certificate,
dated the Closing Date, of its Secretary or Assistant Secretary as to (i)
resolutions of its Board of Directors then in full force and effect authorizing
the execution, delivery and performance of each Loan Document to be executed by
it, and (ii) the incumbency and signatures of those of its officers authorized
to act with respect to each Loan Document executed by it, upon which
certificate each Agent and each Lender may conclusively rely until it shall
have received a further
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certificate of the Secretary or Assistant Secretary of such Obligor
canceling or amending such prior certificate.
SECTION 5.2. Delivery of Term Notes and the Bond. (a) Each Lender shall
have received its Term Note duly executed and delivered by the Borrower.
(b) The Collateral Agent shall have received the Bond and the Bond Pledge
Agreement related thereto, each duly executed and delivered by the Borrower.
SECTION 5.3. Guarantees. The Agents shall have received executed
counterparts of (a) the Affiliate Guaranty, dated the date hereof and duly
executed and delivered by an Authorized Officer of each of the Affiliate
Guarantors and (b) the Canadian Subsidiary Guaranty, dated the date hereof and
duly executed and delivered by an Authorized Officer of PCICC.
SECTION 5.4. Consummation of Acquisition. The Agents shall have received
evidence satisfactory to each of them that all actions necessary to consummate
the Acquisition shall have been taken in accordance with all applicable law and
that the Acquisition shall have been consummated in accordance with the terms
of the Purchase Agreement without amendment or waiver of any material provision
thereof by PCI, PCICC, PCI Carolina or any of their Affiliates. There shall
exist at and as of the Closing Date (after giving effect to the transactions
contemplated by the Purchase Agreement) no conditions that would constitute a
default or an event of default under the Purchase Agreement.
SECTION 5.5. Issuance of the Senior Secured Notes. The Agents shall have
received evidence satisfactory to each of them that PCICC shall have received
gross proceeds from the issuance of the Senior Secured Notes in a principal
amount not to exceed $175,000,000, which proceeds (net of underwriting and
other fees and expenses incurred in connection with the Senior Secured Note
Offering) shall have been applied to the purchase price in connection with the
Acquisition. The Agents shall be reasonably satisfied with all terms and
provisions of all documentation relating to such Senior Secured Notes
(including the Senior Secured Note Indenture).
SECTION 5.6. Revolving Credit Agreement. The Agents shall have received
copies of fully executed versions of the Revolving Credit Agreement, certified
to be true and complete copies thereof by an Authorized Officer of PAAC, and be
satisfied with the terms of such Revolving Credit Agreement. As of the Closing
Date, each condition to the amendment thereof contemplated by the Revolving
Credit Agreement shall have been satisfied or, with appropriate consents,
waived. There shall exist at and as of the Closing Date (after giving effect
to the transactions contemplated by the Revolving Credit Agreement) no
conditions that would constitute a default or event of default under the
Revolving Credit Agreement.
SECTION 5.7. Transaction Documents. The Agents shall have received (with
copies for each Lender that shall have expressly requested in writing copies
thereof) copies of fully executed versions of all other Transaction Documents,
certified to be true and complete copies thereof by an Authorized Officer of
the Borrower, and be satisfied with the terms of all such agreements and
documents. The Arranger, the Syndication Agent and the Documentation Agent
shall be reasonably satisfied with all other aspects of the Transaction,
including the aggregate
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sources and uses of proceeds utilized to consummate the Transaction
(including fees and expenses not to exceed $14,400,000 in the aggregate).
SECTION 5.8. Canadian Demand Debenture. PCICC shall have caused to be
delivered to the Collateral Agent, with copies to the Agents, the following
documents and instruments with regard to each Mortgaged Property of PCICC,
providing for first priority mortgages:
(a) each Canadian Demand Debenture and each Canadian Demand
Debenture Pledge Agreement related thereto, each duly executed by PCICC,
together with evidence of the due recordation thereof in the appropriate
recording office of the political subdivision where such Mortgaged
Property is situated (or evidence reasonably satisfactory to the Arranger,
the Syndication Agent and the Documentation Agent that such Canadian
Demand Debenture has been delivered to the appropriate recording office
for recording and that all fees, taxes and other expenses associated with
such recording have been paid);
(b) Other than in respect of the Exempt Properties, opinions of
Counsel confirming that PCICC is the owner, in fee simple, of the
Mortgaged Properties with a good and marketable title thereto, free and
clear of all encumbrances except Permitted Liens and that such Canadian
Demand Debenture is a good and valid first mortgage of PCICC's interest in
the Mortgaged Properties, in form and substance reasonably satisfactory to
the Arranger, the Syndication Agent and the Documentation Agent, subject
only to such other matters as are acceptable to the Arranger, the
Syndication Agent and the Documentation Agent;
(c) Other than in respect of the Exempt Properties, certified
perimeter surveys or certificates of location of the real property covered
by such Canadian Demand Debenture by registered surveyors as of a date and
in form and substance acceptable to the Arranger, the Syndication Agent
and the Documentation Agent, bearing legal descriptions indicating the
length of exterior boundary lines of such Mortgaged Property, locations of
all buildings, utility or other easements or servitudes, showing the
location of all servitudes, easements of record, encroachments, if any,
and means of access to the real property from a public way; and the
surveyor's original certification to the Syndication Agent and the
Collateral Agent, together with a statutory declaration of the senior
officer of PCICC confirming that all buildings, fencing, erections,
enclosures and other structures or improvements presently situated on the
Mortgaged Properties are in the locations wholly within the limits of the
Mortgaged Properties and that there are no additions or changes to the
locations of the buildings as shown on such surveys since the date of such
surveys; it being acknowledged and agreed by the parties hereto that any
such certified perimeter survey in respect of the Missassauga Property
shall be delivered to the Arranger, the Syndication Agent, the
Documentation Agent and the Collateral Agent within 45 days of the Closing
Date;
(d) evidence reasonably satisfactory to the Arranger, the
Syndication Agent and the Documentation Agent of all filings of
registrations or applications for registrations necessary or desirable to
perfect the Lien created pursuant to such Canadian Demand Debenture (or
evidence reasonably satisfactory to the Arranger, the Syndication Agent
and the Documentation Agent that such registrations or applications for
registrations have been delivered to the appropriate registry office(s)
and that all fees, taxes and other
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expenses associated with such filings have been paid), together with such
searches of Liens, judgment and tax lien records (other than in respect of
the property located in Point Xxxxxx, Nova Scotia, Canada) as the
Arranger, the Syndication Agent and the Documentation Agent shall
reasonably require;
(e) policies or certificates of insurance with respect to the
insurance required to be maintained in respect of the property covered by
such Canadian Demand Debenture pursuant to the terms of this Agreement,
naming the Collateral Agent as loss payee or additional named insured, as
appropriate; and
(f) such other agreements, instruments, approvals, consents,
opinions, or documents as the Syndication Agent, the Documentation Agent,
the Administrative Agent, the Collateral Agent or their respective counsel
may reasonably request.
SECTION 5.9. Security Agreements. The Collateral Agent and each of the
Agents shall have received executed counterparts of each of the Canadian
Subsidiary Security Agreement and the Affiliate Security Agreement, each dated
as of the date hereof and duly executed and delivered by an Authorized Officer
of, in the case of the Canadian Subsidiary Security Agreement, PCICC, and in
the case of the Affiliate Security Agreement, each of PCI Carolina and Pioneer
Licensing, together with
(a) in the case of PCI Carolina and Pioneer Licensing
(i) executed Uniform Commercial Code financing statements (Form
UCC-1) naming each of PCI Carolina and Pioneer Licensing, as the
debtor and the Collateral Agent as the secured party, or other
similar instruments or documents, to be filed under the Uniform
Commercial Code or other similar laws for all jurisdictions as may be
necessary or, in the opinion of the Collateral Agent, desirable to
perfect the security interest of the Collateral Agent pursuant to the
Security Agreements; and
(ii) certified copies of Uniform Commercial Code Requests for
Information or Copies (Form UCC-11), or a similar search report
certified by a party acceptable to the Collateral Agent and the
Agents, dated a date reasonably near to the Closing Date, listing all
effective financing statements which name PCI Carolina, Pioneer
Licensing or the U.S. Seller (under its present name and any previous
names), as the debtor and which are filed in the jurisdiction in
which filings were made pursuant to clause (a)(i) above, together
with copies of such financing statements; and
(b) in the case of PCICC, (i) evidence reasonably satisfactory to the
Arranger, the Syndication Agent and the Documentation Agent of all
financing statements under the applicable PPSA and all other filings and
registrations necessary or desirable to perfect the Lien created pursuant
to such Canadian Subsidiary Security Agreement (or evidence reasonably
satisfactory to the Arranger, the Syndication Agent and the Documentation
Agent that such financing statements have been delivered to the applicable
filing office(s) and that all fees, taxes and other expenses associated
with such filings have been paid), together with such searches of Liens,
judgment and tax lien records as the Arranger, the Syndication Agent and
the Documentation Agent shall reasonably require, and (ii) lien
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searches in the names of PCICC and each Subsidiary of PCICC (and in all
names under which it has done business within the last five years) in each
Canadian Province where each such Person maintains an office or has
property, showing no financing statements or other lien instruments of
record except for Permitted Liens (and Liens released in accordance with
this Agreement).
SECTION 5.10. Quebec Mortgage and Security Agreement. The Collateral
Agent and each of the Agents shall have received executed counterparts of the
Quebec Mortgage and Security Agreement, dated as of the date hereof and duly
executed and delivered by an Authorized Officer of PCICC, together with
evidence of the registration, filing and recording of the Liens (both moveable
and immoveable hypothecs) including:
(a) an executed application for registration of those Liens
constituting moveable hypothecs under the Quebec Mortgage and Security
Agreement, naming PCICC as the grantor and the Collateral Agent as the
holder, to be published in the Register of Personal and Moveable Real
Rights in the Province of Quebec;
(b) a statement of all the rights registered in the Register of
Personal and Moveable Real Rights in the Province of Quebec against the
moveable property, both tangible and intangible, of PCICC, certified by
the Registrar and dated a date reasonably near to the date hereof,
together with copies of the documents forming part of the records of the
Registry Office;
(c) certified perimeter surveys or certificates of location of the
real immovable property covered by the Quebec Mortgage and Security
Agreement by registered surveyors as of a date and in form and substance
acceptable to the Arranger, the Syndication Agent and the Documentation
Agent, bearing legal descriptions; indicating the length of exterior
boundary lines of the Mortgaged Property, locations of all buildings,
utility or other easements or servitudes, showing the location of all
servitudes, easements of record, encroachments, if any, and means of
access to the real property from a public way; and the surveyor's original
certification to the Syndication Agent and the Collateral Agent;
(d) policies or certificates of insurance with respect to the
insurance required to be maintained in respect of the property covered by
the Quebec Mortgage and Security Agreement pursuant to the terms of this
Agreement, naming the Collateral Agent as loss payee or additional named
insured, as appropriate; and
(e) such other agreements, instruments, approvals, consents,
opinions, or documents as the Syndication Agent, the Documentation Agent,
the Administrative Agent, or their respective counsel may reasonably
request.
SECTION 5.11. Closing Date Certificates. The Agents shall have received,
with counterparts for each Lender, the Closing Date Certificates, substantially
in the form of Exhibits G-1, G-2 and G-3 hereto, respectively, dated the
Closing Date and duly executed and delivered by each of:
(a) the chief executive or financial (or equivalent) Authorized
Officer of the Borrower, in which certificate the Borrower shall agree and
acknowledge that the
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statements made therein shall be deemed to be true and correct
representations and warranties of the Borrower made as of such date under
this Agreement, and, at the time such certificate is delivered, such
statements shall in fact be true and correct;
(b) the chief executive or financial (or equivalent) Authorized
Officer of PAAC, in which certificate PAAC shall agree and acknowledge
that the statements made therein shall be deemed to be true and correct
representations and warranties of PAAC made as of such date under this
Agreement, and, at the time such certificate is delivered, such statements
shall in fact be true and correct; and
(c) the chief executive or financial (or equivalent) Authorized
Officer of PCI, in which certificate PCI shall agree and acknowledge that
the statements made therein shall be deemed to be true and correct
representations and warranties of PCI made as of such date under this
Agreement, and, at the time such certificate is delivered, such statements
shall in fact be true and correct.
SECTION 5.12. Financial Information, etc. The Agents shall have received
(a) the audited financial statements of PAAC as of December 31, 1996
and for the period from March 6, 1995 through December 31, 1995;
(b) the audited financial statements of PAAC's predecessor, the
Borrower, as of December 31, 1994 and for the period from January 1, 1995
through April 20, 1995;
(c) the unaudited financial statements of PAAC for the period from
April 1, 1997 through June 30, 1997 and for the cumulative period from
January 1, 1997 through June 30, 1997; and
(d) a pro forma opening balance sheet of each of the Borrower and
of PAAC, in each case as of June 30, 1997, giving effect to the
contemplated Transaction and reflecting the proposed legal and capital
structure of the Borrower as of the Closing Date (the "Pro Form Balance
Sheets"), which legal and capital structure shall be satisfactory in all
respects to Agents.
SECTION 5.13. Pro Forma Balance Sheet Certificate. The Agents shall have
received a certificate from the chief executive or financial Authorized Officer
of each of the Borrower and PAAC, dated the date of the initial Borrowing, with
respect to delivery of the Pro Forma Balance Sheets described in clause (d) of
Section 5.12.
SECTION 5.14. Target Business Financial Information. The Agents shall
have received
(a) consolidated financial statements of the Target Business
including balance sheets as at December 31, 1996, and December 31, 1995,
and statements of operations and changes in financial position as of
December 31, 1996, December 31, 1995 and December 31, 1994, audited by
independent public accountants of recognized international standing and
prepared in accordance with generally accepted accounting principles as
then in effect in Canada (with a reconciliation to GAAP), together with
the report thereon; and
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(b) unaudited interim financial statements of the Target Business,
prepared in the same manner as the historical audited statements, for the
six-month period, ended June 30, 1997 and June 30, 1996.
SECTION 5.15. Indebtedness Certificate. The Agents shall have received,
with copies for each Lender, a certificate from the chief financial Authorized
Officer of PAAC, dated the Closing Date, certifying that, immediately after the
making of the Term Loans hereunder and the issuance of the Senior Secured
Notes, PAAC's Consolidated Cash Flow Coverage Ratio is at least 2.0 to 1.0 as
required pursuant to Section 7.2.1 of the Existing Term Loan Agreement and
Section 1008 of the Existing Senior Secured Note Indenture, together with
detailed supporting calculations satisfactory in form and scope to the Agents.
SECTION 5.16. Intercreditor Agreement. The Borrower, PCICC, the Trustee,
the Administrative Agent, BofA (as agent under the Revolving Credit Agreement)
and the Collateral Agent shall have entered into the Intercreditor Agreement,
and the Arranger and the Syndication Agent shall have received and be satisfied
with the terms of the executed versions thereof.
SECTION 5.17. Litigation. There shall exist no pending or threatened
material litigation, proceedings or investigations which (x) contests the
consummation of the Transaction or (y) could reasonably be expected to have a
Material Adverse Effect.
SECTION 5.18. Material Adverse Change. Since December 31, 1996, there
shall have occurred no material adverse change in the business, assets, debt
service capacity, liabilities (including environmental liabilities), financial
condition, operations or prospects of PAAC and its Subsidiaries or the Target
Business.
SECTION 5.19. Consents and Approvals, etc. All governmental and third
party approvals necessary or advisable in connection with each aspect of the
Transaction and the continuing operations of the Borrower, its Subsidiaries and
the Target shall have been obtained and be in full force and effect, and all
applicable waiting periods shall have expired without any action being taken or
threatened by any competent authority which would restrain, prevent or
otherwise impose adverse conditions on any aspect of the Transaction.
SECTION 5.20. Reliance Letters. The Syndication Agent and the
Administrative Agent shall, unless otherwise agreed, have received reliance
letters, dated the Closing Date and addressed to each Lender and each Agent, in
respect of each of the legal opinions (other than "disclosure" and other
similar opinions) delivered in connection with the Transaction.
SECTION 5.21. Opinions of Counsel. The Syndication Agent and the
Administrative Agent shall have received opinions, dated the Closing Date and
addressed to the Agents and all Lenders from
(a) Xxxxxxx Xxxx & Xxxxxxxxx, special New York counsel for the
Borrower and the Guarantors, in form and substance satisfactory to the
Agents,
(b) Stikeman, Xxxxxxx (Montreal), special Quebec counsel for PCICC
and the Guarantors, in form and substance satisfactory to the Agents,
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(c) Stikeman, Xxxxxxx (Toronto), special Ontario counsel for the
Borrower and the Guarantors, in form and substance satisfactory to the
Agents,
(d) Xxxx X. Xxxxxxxxxx, Esq., the General Counsel of PAAC, in form
and substance satisfactory to the Agents, and
(e) Stewart, McKelvey, Stirling & Scales, special New Brunswick and
Nova Scotia counsel to the Borrower and the Guarantors, in form and
substance satisfactory to the Agents.
SECTION 5.22. Closing Fees, Expenses, etc. The Lenders, the Agents and
the Arranger shall have received, each for their own respective accounts
(including in their capacity as a Lender), as the case may be, all fees, costs
and expenses due and payable pursuant to Sections 3.3 and 10.4 if then
invoiced).
SECTION 5.23. Satisfactory Legal Form. All documents executed or
submitted pursuant hereto by or on behalf of the Borrower or any of its
Subsidiaries or any other Obligors shall be reasonably satisfactory in form and
substance to the Agents and their counsel; the Agents and their counsel shall
have received all information, approvals, opinions, documents or instruments as
the Agents or their counsel may reasonably request.
SECTION 5.24. Compliance with Warranties, No Default, etc. Both before
and after giving effect to the making of any Term Loan hereunder, the following
statements shall be true and correct:
(a) the representations and warranties set forth in Article VI and
each other Loan Document shall, in each case, be true and correct with the
same effect as if then made (unless stated to relate solely to an earlier
date, in which case such representations and warranties shall be true and
correct as of such earlier date); and
(b) no Default shall have then occurred and be continuing, and
neither PAAC, the Borrower, nor any of their respective Subsidiaries are
in material violation of any law or governmental regulation or court order
or decree.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders and the Agents to enter into this Agreement
and to make the Term Loans hereunder, each of the Borrower and PAAC represents
and warrants unto the Agents and each Lender as set forth in this Article VI.
SECTION 6.1. Organization, etc. Each of the Borrower and PAAC and their
respective Subsidiaries is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdiction of its respective
incorporation or organization. Each of the Borrower and PAAC and their
respective Subsidiaries is in good standing and is duly qualified to do
business in each jurisdiction where, because of the nature of its activities or
properties, such qualification
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is required, except for those states in which its failure to qualify to do
business would not be reasonably likely to have a Material Adverse Effect.
SECTION 6.2. Due Authorization, Non-Contravention, etc. The Borrower is
duly authorized to execute and deliver this Agreement, the Term Notes, and each
other Loan Document to be executed by it and is duly authorized to borrow
monies hereunder and to perform its obligations under this Agreement, the Term
Notes and each other Loan Document to be executed by it. PAAC is duly
authorized to execute and deliver this Agreement and each other Loan Document
to be executed by it and is and will continue to be duly authorized to perform
its obligations under this Agreement and each other Loan Document to be
executed by it. Each other Obligor is duly authorized to execute and deliver
each Loan Document to be executed by it and is and will continue to be duly
authorized to perform its obligations thereunder. The execution, delivery and
performance by (a) the Borrower of this Agreement, the Term Notes and each
other Loan Document to which it is a party and the Borrowings hereunder, (b)
PAAC of this Agreement and each other Loan Document to which it is a party and
(c) each other Obligor of each Loan Document to which it is a party do not and
will not require any consent or approval of any governmental agency or
authority.
SECTION 6.3. No Conflicts. The execution, delivery and performance by
(a) the Borrower of this Agreement, the Term Notes and each other Loan Document
to which it is a party, (b) PAAC of this Agreement and each other Loan Document
to which it is a party and (c) each other Obligor of each Loan Document to
which it is a party do not and will not conflict with (i) any provision of law,
(ii) the Certificate or Articles of Incorporation, as applicable, or bylaws, of
the Borrower, PAAC or such other Obligor, (iii) any agreement binding upon the
Borrower, PAAC or such other Obligor which conflict is reasonably likely to
have a Material Adverse Effect or (iv) any court or administrative order or
decree applicable to the Borrower, PAAC or such other Obligor which conflict is
reasonably likely to have a Material Adverse Effect, and do not and will not
require, or result in, the creation or imposition of any Lien on any asset of
the Borrower, PAAC or any other Obligor, except as provided herein.
SECTION 6.4. Validity and Binding Effect. This Agreement, the Term Notes
and each other Loan Document contemplated by this Agreement, when duly executed
and delivered, will be legal, valid and binding obligations of the Borrower,
PAAC and each other Obligor party thereto, as applicable, enforceable against
the Borrower, PAAC and each such Obligor in accordance with their respective
terms.
SECTION 6.5. No Default. Neither the Borrower, PAAC nor any Subsidiary
of the Borrower or PAAC is in default under any agreement or instrument to
which the Borrower, PAAC or such Subsidiary is a party or by which any of their
respective properties or assets is bound or affected, which default is
reasonably likely to have a Material Adverse Effect. No Default or Event of
Default has occurred and is continuing.
SECTION 6.6. Financial Statements. Each of the financial statements of
PAAC and of PAAC's predecessor, the Borrower, referred to in clauses (a), (b)
and (c) of Section 5.12 have been furnished to the Agents, have been prepared
in conformity with GAAP applied on a basis consistent with that of the
preceding Fiscal Year and period, and present fairly the financial condition of
PAAC and its Subsidiaries as of such dates and the results of their operations
for the periods then ended, subject (in the case of the interim financial
statement) to year-end audit adjustments. The Pro Forma Balance Sheets include
appropriate pro forma adjustments to give
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pro forma effect to the Transaction (including assumptions that have been made
on a reasonable basis). Since December 31, 1996, there has not occurred or
arisen any event or condition which has had or is reasonably likely to have a
Material Adverse Effect.
SECTION 6.7. Insurance. Item 6.7 ("Insurance") of the Disclosure
Schedule is a complete and accurate summary of the property and casualty
insurance program that is or will be carried by each of the Borrower, PAAC and
their Subsidiaries on the Closing Date. Such Item 6.7 includes name(s) of
insurer(s), policy number(s), expiration date(s), amount(s) of coverage,
type(s) of coverage, the annual premium(s), deductibles and self-insured
retention and describes any retrospective rating plan, fronting arrangement or
any other self-insurance or risk assumption agreed to by the Borrower, PAAC or
any of their Subsidiaries or imposed upon the Borrower, PAAC or any such
Subsidiary by any such insurer. This summary also includes any self-insurance
program that is in effect.
SECTION 6.8. Litigation; Contingent Liabilities. (a) As of the date
hereof and the Closing Date, except for those referred to in Item 6.8
("Litigation") of the Disclosure Schedule, there are no claims, litigation,
arbitration proceedings or governmental proceedings pending or threatened
against or affecting the Borrower, PAAC, any of their respective Subsidiaries
or any Related Party, the results of which are reasonably likely to have a
Material Adverse Effect.
(b) As of the date hereof and the Closing Date, other than any liability
incident to the claims, litigation or proceedings disclosed in Item 6.8 of the
Disclosure Schedule or provided for or disclosed in the financial statements
referred to in Section 6.6, neither the Borrower or PAAC nor any of their
Subsidiaries has any contingent liabilities which are reasonably likely to have
a Material Adverse Effect.
SECTION 6.9. Liens. None of the Collateral or other property, revenues
or assets of the Borrower, PAAC or any of their Restricted Subsidiaries is
subject to any Lien except Liens permitted by clauses (a) and (b) of Section
7.2.2.
SECTION 6.10. Subsidiaries. As of the date hereof and the Closing Date,
all of PAAC's Subsidiaries are listed in Item 6.10 ("Subsidiaries") of the
Disclosure Schedule. Item 6.10 of the Disclosure Schedule sets forth, for each
such Subsidiary, a complete and accurate statement of (a) PAAC's percentage
ownership of each of Subsidiaries, (b) the state or other jurisdiction of
formation or incorporation of each such Subsidiary and (c) each state in which
each such Subsidiary is qualified to do business. As of the date hereof and
the Closing Date, no PCIFP Company has any Subsidiaries.
SECTION 6.11. Partnerships; Joint Ventures. As of the date hereof and
the Closing Date, neither the Borrower or PAAC nor any of their Subsidiaries is
a partner or joint venturer in any partnership or joint venture other than the
partnerships and joint ventures listed in Item 6.11 ("Partnerships and Joint
Ventures") of the Disclosure Schedule. Item 6.11 of the Disclosure Schedule
sets forth, for each such partnership or joint venture, a complete and accurate
statement of (a) PAAC's and each Subsidiary's percentage ownership of each such
partnership or joint venture, (b) the state or other jurisdiction of formation
or incorporation, as appropriate, of each such partnership or joint venture and
(c) each state in which each such partnership or joint venture is qualified to
do business.
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SECTION 6.12. Senior Secured Notes. The Senior Secured Notes have been
issued and sold to the initial purchasers thereof on or prior to the Closing
Date in accordance with and pursuant to the terms of the Offering Memorandum
and in compliance with all laws, including Rule 144A of the Securities Act of
1933, as amended and all other applicable federal and state securities laws.
The issuance of the Senior Secured Notes and the execution of the Senior
Secured Note Indenture have been duly authorized by all necessary corporate
action on the part of PCICC and each of its Affiliates party thereto and will
not require any consent or approval of any governmental agency or authority
that has not been obtained prior to the date hereof. The issuance of the
Senior Secured Notes and the execution of the Senior Secured Note Indenture do
not conflict with (i) any provision of law, (ii) the Certificate or Articles of
Incorporation or by- laws of PCICC or any of its Affiliates, (iii) any
agreement binding upon PCICC or any of its Affiliates which conflict is
reasonably likely to have a Material Adverse Effect, or (iv) any court or
administrative order or decree applicable to PCICC or any of its Affiliates
which conflict is reasonably likely to have a Material Adverse Effect, and do
not and will not require, or result in, the creation or imposition of any Lien
on any asset of PCICC or any of its Affiliates. All representations and
warranties of PCICC and each of its Affiliates contained in the purchase
agreement relating to the Senior Secured Notes are true and correct in all
material respects as of the date hereof and the Closing Date.
SECTION 6.13. Intellectual Property. Each of the Borrower, PAAC and
their respective Subsidiaries possesses adequate licenses, patents, patent
applications, copyrights, trademarks, trademark applications, trade styles, and
trade names to continue to conduct its respective business as heretofore
conducted by it or, in the case of the Target Business, its predecessors, and
all such licenses, patents, patent applications, copyrights, trademarks,
trademark applications, trade styles, and trade names that will be existing on
the Closing Date of the Borrower, PAAC or any such Subsidiary are listed in
Item 6.13 ("Intellectual Property") of the Disclosure Schedule.
SECTION 6.14. Solvency. Each of the Borrower and the Guarantors,
immediately after giving effect to the Transaction on the Closing Date, will be
Solvent. As used herein, the term "Solvent" means, with respect to any such
entity on a particular date (i) the fair value of the property of such entity
is greater than the total amount of liabilities (including contingent
liabilities) of such entity, (ii) the present fair saleable value of the assets
of such entity is greater than the probable liability of such entity on its
total existing debts (including contingent liabilities) as they become absolute
and matured, (iii) such entity will be able to pay its debts and liabilities as
they mature and (iv) such entity will not have unreasonably small capital for
the business in which it is engaged, as now conducted and as proposed to be
conducted following the consummation of the Transaction.
SECTION 6.15. Contracts; Labor Matters. Except as disclosed in Item 6.15
("Contracts and Labor Matters") of the Disclosure Schedule: (a) neither the
Borrower or PAAC nor any of their Subsidiaries is a party to any contract or
agreement, or is subject to any charge, corporate restriction, judgment, decree
or order, which is reasonably likely to have a Material Adverse Effect; (b) as
of the date hereof and the Closing Date, no labor contract to which the
Borrower, PAAC or any of their Subsidiaries is a party or is otherwise subject
is scheduled to expire prior to the Stated Maturity Date; (c) neither the
Borrower or PAAC nor any of their Subsidiaries (or any of their respective
predecessors or, with respect to the Target Business, predecessors in interest)
has, within the two (2) year period preceding the date of this Agreement, taken
any action which would have constituted or resulted in a "plant closing" or
"mass layoff" within the
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meaning of the Federal Worker Adjustment and Retraining Notification Act of
1988 or any similar applicable U.S. federal, state or local law or any Canadian
federal, provincial or local law that sets out requirements respecting plant
closings or layoffs, and neither the Borrower nor PAAC has any reasonable
expectation that any such action is or will be required any time prior to the
Stated Maturity Date; and (d) on the date of this Agreement and the Closing
Date (i) neither the Borrower or PAAC nor any of their Subsidiaries (or any of
their respective predecessors) is a party to, or subject to, any labor dispute
and (ii) there are no strikes or walkouts relating to any labor contracts to
which the Borrower or PAAC or any of its Subsidiaries (or any of their
respective predecessors) is a party or is otherwise subject.
SECTION 6.16. Pension and Welfare Plans. (a) Each Pension Plan
complies, and has been administered in compliance, in all material respects,
with all applicable statutes and governmental rules and regulations; no
Reportable Event has occurred and is continuing with respect to any Pension
Plan; neither the Borrower nor PAAC nor any ERISA Affiliate of either has
withdrawn from any Multiemployer Plan in a "complete withdrawal" or a "partial
withdrawal" as defined in section 4203 or 4205 of ERISA, respectively, with
respect to which the Borrower, PAAC or any ERISA Affiliate of either has any
unsatisfied liability; no steps have been instituted to terminate any Pension
Plan; no contribution failure has occurred with respect to any Pension Plan
sufficient to give rise to a Lien under section 302(f) of ERISA; no condition
exists or event or transaction has occurred in connection with any Pension Plan
or Multiemployer Plan that is reasonably likely to have a Material Adverse
Effect; and neither the Borrower nor PAAC nor any ERISA Affiliate of either is
a "contributing sponsor" as defined in section 4001(a)(13) of ERISA of a
"single-employer plan" as defined in section 4001(a)(15) of ERISA that has two
or more contributing sponsors at least two of whom are not under common
control. Except as listed in Item 6.16 ("Pension and Welfare Plans") of the
Disclosure Schedule, neither the Borrower nor PAAC nor any ERISA Affiliate of
either, to the extent there is joint and several liability with the Borrower or
PAAC to pay such benefits, has any liability to pay any welfare benefits under
any employee welfare benefit plan within the meaning of section 3(l) of ERISA
to former employees thereof or to current employees with respect to claims
incurred after the termination of their employment other than as required by
section 4980B of the Code or Part 6 of Subtitle B of Title 1 of ERISA.
(b) PCICC has entered into the Pension Transfer Agreement referred to in
the definition of "Acquisition Agreements" based (i) on a review to its
satisfaction of actuarial information requested by, and provided to, it by the
Canadian Seller, together with such other material as is referred to in Section
3.1(12) of the Purchase Agreement and (ii) on the representations of the
Canadian Seller set forth in Sections 3.1(12) and (13) of the Purchase
Agreement, pursuant to which PCICC will establish a Canadian Pension Plan, to
become effective October 31, 1997, which Canadian Pension Plan will receive
assets from prior pension plans for which the Canadian Seller was liable equal
to the greater of the going concern liabilities and the solvency liabilities in
respect of the initial participants as of October 31, 1997, such assets to be
computed (A) on the basis of the actuarial assumptions and methods specified in
the applicable legislation and the most recent actuarial valuations for the
prior pension plans and (B) subject to the approval of the relevant
authorities.
SECTION 6.17. Regulations G, U and X. Neither the Borrower nor PAAC nor
any of their Subsidiaries is engaged in the business of purchasing or selling
Margin Stock or extending credit to others for the purpose of purchasing or
carrying Margin Stock, and no part of the
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proceeds of the Term Loans will be used to purchase or carry any Margin Stock
or for any other purpose which would violate any of the margin regulations of
the Federal Reserve Board.
SECTION 6.18. Compliance. The Borrower, PAAC and their respective
Subsidiaries are each in compliance with all statutes and governmental rules
and regulations applicable to it, the noncompliance with which is reasonably
likely to have a Material Adverse Effect.
SECTION 6.19. Taxes. The Borrower, PAAC and their respective
Subsidiaries have each filed all material tax returns which are required to
have been filed and has paid, or made adequate provisions for the payment of,
all of its Taxes which are due and payable, except such Taxes, if any, as are
being contested in good faith and by appropriate proceedings and as to which
such reserves or other appropriate provisions as may be required by GAAP have
been maintained. The federal income tax liability of PAAC and its Subsidiaries
has been audited by the Internal Revenue Service and has been finally
determined and satisfied (or the time for audit has expired) for all tax years
up to and including the tax year ended December 31, 1993. Neither the Borrower
nor PAAC is aware of any proposed assessment against the Borrower, PAAC or any
of their Subsidiaries for additional Taxes (or any basis for any such
assessment).
SECTION 6.20. Investment Company Act Representation. Neither the
Borrower or PAAC nor any of their Subsidiaries is an "investment company" or a
company "controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
SECTION 6.21. Public Utility Holding Company Act Representation. Neither
the Borrower or PAAC nor any of their Subsidiaries is a "holding company" or a
"subsidiary company" of a "holding company" or an "affiliate" of a "holding
company" within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
SECTION 6.22. Environmental and Safety and Health Matters. Each of the
Borrower, PAAC and their Subsidiaries and/or each property, operations and
facility that the Borrower, PAAC or any such Subsidiary owns, operates or
controls
(a) complies in all respects with (i) all applicable Environmental
Laws, the noncompliance with which is reasonably likely to have a Material
Adverse Effect and (ii) all applicable Occupational Safety and Health
Laws, the noncompliance with which is reasonably likely to have a Material
Adverse Effect;
(b) has not received any notice (i) that it may be in violation of
any Environmental Law or Occupational Safety and Health Law which is
reasonably likely to have a Material Adverse Effect, (ii) threatening the
commencement of any proceeding under any Environmental Law or Occupational
Safety and Health Law, which is reasonably likely to have a Material
Adverse Effect, or (iii) alleging that it is or may be responsible for any
response, cleanup, or corrective action, including but not limited to any
remedial investigation/feasibility studies, under any Environmental Law or
Occupational Safety and Health Law, which, is reasonably likely to have a
Material Adverse Effect;
(c) to PAAC's and the Borrower's knowledge, neither PAAC nor any of
its Subsidiaries (including the Borrower and its Subsidiaries (including
the Target
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Business)) is the subject of any Canadian or U.S. federal, state or
provincial investigation evaluating whether any investigation, remedial
action or other response is needed to respond to (i) a Release or
threatened Release into the environment of any Hazardous Material or the
spillage, disposal or release or threatened release into the environment
of any other hazardous, toxic or dangerous waste, substance or
constituent, or other substance regulated under any Environmental Law
which is reasonably likely to have a Material Adverse Effect or (ii) any
allegedly unsafe or unhealthful condition regulated under any
Environmental Law or Occupational Safety and Health Law which is
reasonably likely to have a Material Adverse Effect;
(d) has not filed any notice under or relating to any Environmental
Law or Occupational Safety and Health Law indicating or reporting (i) any
past or present Release into the environment of, or treatment, storage or
disposal of, any Hazardous Material or spillage, disposal or release into
the environment of any other hazardous, toxic or dangerous waste,
substance or constituent, or other substance regulated under any
Environmental Law or (ii) any potentially unsafe or unhealthful condition,
in either case, which is reasonably likely to have a Material Adverse
Effect, and to PAAC's and the Borrower's knowledge, there exists no basis
for such notice irrespective of whether such notice was actually filed;
and
(e) has no contingent liability in connection with any actual
Release into the environment of, or otherwise with respect to, any
Hazardous Material or spillage, disposal or release into the environment
of any other hazardous, toxic or dangerous waste, substance or
constituent, or other substance, whether on any premises owned or occupied
by the Borrower, PAAC or any or their respective Subsidiaries or on any
other premises, which is reasonably likely to have a Material Adverse
Effect.
There are no Hazardous Materials on, in or under any property or facilities
owned, operated or controlled by the Borrower, PAAC or any of their respective
Subsidiaries the presence of which is reasonably likely to have a Material
Adverse Effect, including but not limited to such Hazardous Materials that may
be contained in underground storage tanks, but excepting such Hazardous
Materials used in accordance with all applicable laws and such Hazardous
Materials used in the same manner as an ordinary consumer (e.g., gasoline in
tanks of motor vehicles, small amounts of cosmetic cleaners, etc.).
SECTION 6.23. Related Agreements and Transaction Documents. As of the
date hereof and the Closing Date, all representations and warranties of PCI,
the Borrower, PAAC and each of their respective Subsidiaries contained in any
Loan Document and all representations and warranties of PCI, the Borrower,
PCICC, PCI Carolina, Pioneer Licensing, PAAC and each of their respective
Subsidiaries contained in any Transaction Document (whether such
representations and warranties were made to the Agents or any Lender or to
another Person) are true and correct as if made on the date hereof and the
Closing Date (except for those representations and warranties which are
expressly made as of another specified date) and each of the Borrower and PAAC
hereby adopts and affirms all such representations and warranties which the
Borrower and PAAC agree shall be incorporated by reference herein and made a
part hereof.
SECTION 6.24. Holding Companies. Each of PCI, PAAC, the Borrower, BMPC,
Pioneer East, TCH and Imperial is a holding company without material assets,
operations or
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business, other than the direct ownership of (i) in the case of PCI, all of the
Capital Stock of PAAC and Pioneer Water Technologies, Inc., (ii) in the case of
PAAC, all of the Capital Stock of PAI, (iii) in the case of the Borrower, all
of the Capital Stock of PCICC, PCI Carolina, Pioneer Licensing, PCAC and its
other Subsidiaries, (iv) in the case TCH, all of the Capital Stock of T.C.
Products, Inc. and (v) in the case of Imperial, 50% of the Capital Stock of
Kemwater. None of PCI, PAAC, the Borrower, BMPC, Pioneer East, TCH and
Imperial has any Indebtedness or other obligations other than, in the case of
PAAC, Indebtedness of PAAC in respect of the Existing Term Loans, the loans
made to PAAC pursuant to the Revolving Credit Agreement and the Existing Senior
Secured Notes and guaranties of the Indebtedness of the Borrower and PCICC, in
each case described below, in the case of the Borrower, the Obligations and
guaranties of the Indebtedness of PAAC described above and the Indebtedness of
PCICC under the Senior Secured Notes, and, in the case of BMPC, Pioneer East,
TCH and Imperial, guaranties of the Indebtedness of PAAC, the Borrower and
PCICC, in each case described above.
SECTION 6.25. PCICC, PCI Carolina and Pioneer Licensing. PCICC, PCI
Carolina and Pioneer Licensing were formed for the purpose of acquiring the
assets of the Target Business and have not conducted any operations or incurred
any Indebtedness or obligations other than in connection with the Senior
Secured Notes, Acquisition Agreements and the other aspects of the Transaction.
ARTICLE VII
COVENANTS
SECTION 7.1. Affirmative Covenants. The Borrower and PAAC agree with the
Agents and each Lender that, until all Term Loan Commitments have terminated
and all Obligations have been paid and performed in full, the Borrower and PAAC
will perform the obligations set forth in this Section 7.1.
SECTION 7.1.1. Financial Information, Reports, Notices, etc. The
Borrower and PAAC will furnish, or will cause to be furnished, to each Lender
and each Agent copies of the following financial statements, reports, notices
and information (except to the extent any such Lender shall have provided
written notice to each of the Borrower and PAAC and the Administrative Agent
that it is not to receive any of the following statements, reports, notices and
information):
(a) Annual Audited Financial Statements. Within ninety (90) days
after each Fiscal Year, a copy of the annual audited financial statements
of PAAC and its Subsidiaries, in each case prepared on a consolidated and
consolidating basis and in conformity with GAAP and certified by an
independent certified public accountant who shall be satisfactory to the
Agents, together with (i) a certificate from such accountant to the effect
that, in making the examination necessary for the signing of such annual
audit report, such accountant has not become aware of any Default or Event
of Default that has occurred and is continuing and that relates to
financial or other accounting matters or the covenants set forth in this
Article VII or, if such accountant has become aware of any such event,
describing it and (ii) if prepared in connection with the annual audit
report, the annual operating statements of PAAC and its Subsidiaries
prepared on a consolidated and consolidating basis and in conformity with
GAAP applied in a manner consistent
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with the audit report referred to in preceding clauses (a)(i), signed by
PAAC's chief financial officer or assistant treasurer.
(b) Quarterly Financial Statements. Within forty-five (45) days
after the end of each Fiscal Quarter of PAAC except ninety (90) days after
the end of the Fiscal Quarter closing a Fiscal Year, a copy of the
unaudited financial statements of PAAC and its Subsidiaries prepared on a
consolidated and consolidating basis and in conformity with GAAP applied
in a manner consistent with the audit report referred to in preceding
clause (a)(i), signed by PAAC's chief financial officer and consisting of
at least a balance sheet as at the close of such Fiscal Quarter and an
income statement and cash flow statement for such Fiscal Quarter and for
the period from the beginning of such Fiscal Year to the close of such
Fiscal Quarter, compared, in each case, to the actual results for the same
period during the prior Fiscal Year and to PAAC's budget (delivered
pursuant to paragraph (c) below, for the current Fiscal Year).
(c) Annual Budgets. Within thirty (30) days after the end of each
Fiscal Year of each of PAAC, a copy of an annual budget for PAAC for the
current Fiscal Year, in each case prepared on a consolidated and
consolidating basis and in conformity with GAAP applied in a manner
consistent with the prior Fiscal Year's budget, signed by PAAC's chief
financial officer or assistant treasurer and consisting of at least a
balance sheet, an income statement and a cash flow statement, each
calculated on a quarter by quarter basis.
(d) Officer's Certificate. Together with the financial statements
furnished by PAAC under the preceding clauses (a) and (b), a certificate
of the chief executive or financial officer or assistant treasurer of PAAC
stating that a review of the activities of PAAC and its Subsidiaries
(including the Borrower) during the preceding Fiscal Year has been made
under the supervision of the signing officers with a view to determining
whether each has kept, observed, performed and fulfilled its obligations
under this Agreement and the other Loan Documents, and further stating, as
to each such officer signing such certificate, that to the best of his or
her knowledge each has kept, observed, performed and fulfilled each and
every covenant contained in this Agreement and the other Loan Documents
and is not in default in the performance or observance of any of the
terms, provisions and conditions hereof or thereof (or, if a Default or
Event of Default shall have occurred, describing all such Defaults or
Events of Default of which he or she may have knowledge and what action
each is taking or proposes to take with respect thereto).
(e) SEC and Other Reports. Copies of each filing and report made by
PCI, PAAC or any of their respective Restricted Subsidiaries (including
PCICC) with or to any securities exchange or the Securities and Exchange
Commission, including any registration statement and all amendments
thereto filed with respect to the Senior Secured Notes, or as required
pursuant to the Senior Secured Note Indenture, the Senior Secured Notes or
any other document relating thereto, promptly upon the filing or making
thereof.
(f) Notice of Default. Notice of the occurrence of (i) a Default or
an Event of Default or (ii) a default by PCI, the Borrower, PAAC, any
other Obligor or any Restricted Subsidiary of PAAC (including PCICC) under
any material note, indenture, loan agreement, mortgage, lease, deed or
other material similar agreement to which PCI,
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the Borrower, PAAC, any other Obligor or any such Restricted Subsidiary,
as appropriate, is a party or by which it is bound (including any of the
Loan Documents and the Senior Secured Notes).
(g) Notice of Judgment. Notice of the entry of any judgment or
decree against PCI, the Borrower, PAAC, any other Obligor or any
Restricted Subsidiary of PAAC if the amount of such judgment exceeds
$500,000.
(h) Notice of Other Indebtedness. Copies of any material
amendments, waivers or consents, notices of breach or default, notices
relating to the exercise or nonexercise of any remedy available to any
Person, notices of indemnity or other claims, written materials relating
to any dispute, written materials relating to the exercise of any rights
derived from or arising in connection with any Indebtedness and other
written communications of a material nature, including any communications
by PCI, the Borrower, PAAC or any Restricted Subsidiary of PAAC in
connection with the Loan Documents other than any such notice or other
written materials already sent to the Agents pursuant to any other Section
of this Agreement.
(i) Loan Documents. Any statement, report, notice and/or
information required to be delivered to the Collateral Agent pursuant to
any of the Security Documents.
(j) Other Reports. Any information required to be provided pursuant
to other provisions of this Agreement, and such other reports or
information from time to time reasonably requested by any Agent on behalf
of itself or any Lender.
SECTION 7.1.2. Corporate Existence. Subject to Section 7.2.5, each of
the Borrower and PAAC shall, subject to provisions herein, do or cause to be
done all things necessary to preserve and keep in full force and effect (i) its
corporate existence and the corporate existence of each of its Subsidiaries, in
accordance with their respective organizational documents (as the same may be
amended from time to time) and (ii) its (and its Subsidiaries) rights (charter
and statutory), licenses and franchises; provided, however, that neither the
Borrower nor PAAC shall be required to preserve any such right, license or
franchise, or the corporate existence of any of its Subsidiaries, if its Board
of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Borrower and its Subsidiaries
or PAAC and its Subsidiaries, as the case may be, taken as a whole, and that
the loss thereof is not adverse in any material respect to the Lenders.
SECTION 7.1.3. Maintenance of Properties. Each of the Borrower and PAAC
shall, and shall cause their respective Restricted Subsidiaries to, maintain
their respective (a) existing properties and assets in normal working order and
condition as of the date hereof and (b) properties and assets acquired after
the date hereof in normal working order and condition as of the date of such
acquisition (in each case, reasonable wear and tear excepted) and make all
repairs, renewals, replacements, additions, betterments and improvements
thereto, as shall be reasonably necessary for the proper conduct of the
business of the Borrower and its Restricted Subsidiaries taken as a whole and
of PAAC and its Restricted Subsidiaries taken as a whole, respectively;
provided that nothing herein shall prevent the Borrower, PAAC or any of their
respective Restricted Subsidiaries from discontinuing any maintenance of any
such properties if such discontinuance is desirable in the conduct of the
business of the Borrower and its Restricted Subsidiaries taken as a whole or of
PAAC and its Restricted Subsidiaries taken as a whole.
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SECTION 7.1.4. Insurance. Each of the Borrower and PAAC shall and shall
cause their respective Restricted Subsidiaries to, maintain liability, casualty
and other insurance (subject to the customary deductibles and retentions) with
responsible insurance companies in such amounts and against such risks as is
customarily carried by responsible companies engaged in similar businesses and
owning similar assets in the general areas in which the Borrower, PAAC and
their respective Restricted Subsidiaries operate (which may include
self-insurance in comparable form to that maintained by such responsible
companies).
SECTION 7.1.5. Taxes. Each of the Borrower and PAAC shall, and shall
cause each of their respective Subsidiaries to, pay prior to delinquency all
material taxes, assessments and governmental levies except as are being
contested in good faith and by appropriate proceedings diligently conducted and
in respect of which appropriate reserves (in the good faith judgment of
management of each of the Borrower and PAAC) are being maintained in accordance
with GAAP.
SECTION 7.1.6. Books and Records. Each of the Borrower and PAAC will,
and will cause each of their respective Subsidiaries to, keep books and records
which accurately reflect in all material respects all of its business affairs
and transactions and permit the Agents and each Lender or any of their
respective representatives, at reasonable times and intervals, and upon
reasonable notice, to visit all of its offices, to discuss its financial
matters with its officers and, after notice to PAAC and provision of an
opportunity for PAAC to participate in such discussion, its independent public
accountant (and each of the Borrower and PAAC hereby authorizes such
independent public accountant to discuss the Borrower's and PAAC's financial
matters with each Lender or its representatives whether or not any
representative of either of the Borrower or PAAC is present, so long as PAAC
has been afforded a reasonable opportunity to be present) and to examine, and
photocopy extracts from, any of its books or other corporate records. The cost
and expense of each such visit shall be borne by the applicable Agent or
Lender, except that each Agent may make one such visit each Fiscal Year and the
cost and expense thereof shall be borne, jointly and severally, by the Borrower
and PAAC.
SECTION 7.1.7. Use of Proceeds, etc. The Borrower shall apply the
proceeds of the Term Loans to fund the Acquisition and pay certain fees and
expenses, which fees and expenses shall not exceed $14,400,000 in the
aggregate.
SECTION 7.1.8. Guarantees. (a) If (i) any Subsidiary of PAAC becomes a
Restricted Subsidiary after the Closing Date, (ii) any PCIFP Company or any of
their Restricted Subsidiaries transfers or causes to be transferred, in one
transaction or a series of related transactions, property or assets (including
businesses, divisions, real property, assets or equipment) to any Subsidiary or
Subsidiaries of PAAC that is not a PAI Guarantor or are not PAI Guarantors,
(iii) PAAC or any Subsidiary of PAAC (other than any PCIFP Company or any of
their Restricted Subsidiaries) that is a PAI Guarantor transfers or causes to
be transferred, in one transaction or a series of related transactions,
property or assets (including businesses, divisions, real property, assets or
equipment) which in the aggregate have a value equal to or greater than 15% of
PAAC's and its Subsidiaries' total assets determined on a consolidated basis as
of the time of transfer to any Subsidiary or Subsidiaries of PAAC that is not a
PAI Guarantor or are not PAI Guarantors, (iv) any Subsidiary of PAAC which has
a value equal to or greater than 5% of PAAC's and its Subsidiaries' total
assets determined on a consolidated basis as of the time of determination
directly or indirectly guarantees or otherwise becomes obligated with respect
to any Senior Indebtedness or (v) any Subsidiary of PAAC becomes a guarantor of
the
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Senior Secured Notes, the Existing Senior Secured Notes or the Indebtedness
under the Existing Term Loan Agreement after the date hereof, PAAC shall cause
such Subsidiary or Subsidiaries to execute and deliver to the Administrative
Agent a duly executed PAI Guaranty or a supplement to an existing PAI Guaranty,
substantially in the form attached thereto, pursuant to which such Subsidiary
or Subsidiaries shall unconditionally guarantee, in accordance with the
provisions of such PAI Guaranty, all of the Borrower's Obligations under this
Agreement and the other Loan Documents on the same terms as the other PAI
Guarantors, which guarantee shall rank pari passu with Senior Indebtedness of
such Subsidiary; provided, that clause (a)(i) of this Section 7.1.8 will not
apply to any newly acquired or created Subsidiary organized outside the United
States of America for so long as the issuance of a guarantee by such Subsidiary
would result in a material increase in the aggregate amount of income tax
payable by PAAC on a consolidated basis, and PAAC shall deliver to the
Administrative Agent an Officers' Certificate so stating.
(b) Each guarantee created pursuant to the provisions described in the
foregoing paragraph shall be deemed to be a "PAI Guaranty" and the issuer of
each such PAI Guaranty shall be referred to as a "PAI Guarantor".
Notwithstanding the foregoing (but subject to Section 7.2.6), any PAI Guaranty
shall be automatically and unconditionally released and discharged upon any
sale, exchange, transfer or other disposition to any Person of all of PAAC's
Equity Interest in (or if such Subsidiary is owned by a Restricted Subsidiary
of PAAC, of all of such Restricted Subsidiary's Equity Interest in), or all or
substantially all the assets of, such Subsidiary, which is in compliance with
this Agreement, including Section 7.2.6.
SECTION 7.1.9. Stock Pledge Agreements. The Borrower and PAAC shall, and
shall cause the applicable Subsidiary or Subsidiaries of the Borrower or PAAC
(the "Pledgor Subsidiary" or "Pledgor Subsidiaries") to, execute and deliver to
the Administrative Agent and the Collateral Agent one or more stock pledge
agreements substantially in the form of the Stock Pledge Agreement (as defined
in the Existing Term Loan Agreement) providing for the pledge to the Collateral
Agent for the benefit of (x) the Administrative Agent and the Lenders, and (y)
the Trustee, for itself and the holders of Senior Secured Notes, of all the
Capital Stock of each Restricted Subsidiary of PAAC (including each PCIFP
Company) that (a) is engaged in any business activity other than the holding of
the Capital Stock of one or more Subsidiaries of PAAC (or in the case of
Imperial, engaging in any business activity other than the holding of its
Investment in Kemwater) and (b) has assets equal to or greater than 5% of
PAAC's total assets determined on a consolidated basis as of the time of
determination, together with delivery to the Collateral Agent of stock
certificates evidencing such Capital Stock (together with undated stock powers
executed in blank; which Capital Stock and stock powers will become
"Collateral" for purposes of the Intercreditor Agreement), in each case at such
time as (i) such Capital Stock is not pledged for the benefit of the lenders
under the Existing Term Loan Agreement and subject to the rights therein of the
holders of the Existing Senior Secured Notes and (ii) such pledge shall not
constitute a default or breach under the Existing Term Loan Agreement or the
Existing Senior Secured Notes.
SECTION 7.1.10. Concerning the Collateral and the Loan Documents. (a)
In order to secure the due and punctual payment of the Obligations, including
principal of, premium (if any) and interest (including interest on overdue
principal) on the Term Loans, when and as the same shall become due and
payable, whether on the scheduled payment date therefor, at maturity, by
acceleration or otherwise, and performance of all other obligations of each of
the Borrower and PAAC to the Agents and the Lenders under this Agreement and
each other Loan Document and
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of all obligations of the PAI Guarantors under the PAI Guarantees and each
other Loan Document, each of the Borrower, PAAC and the other Obligors have
entered into each of the applicable Loan Documents to which each is a party.
(b) Each of the Borrower and PAAC shall, and shall cause the other
Obligors to, perform at their sole cost and expense any and all acts and
execute any and all documents (including the execution, amendment or
supplementation of any application for registration, financing statement and
continuation statement or other statement) for filing under the provisions of
the UCC and the rules and regulations thereunder, the applicable PPSA and the
rules and regulations thereunder, the Civil Code of Quebec and any rules or
regulations thereunder or any other statute, rule or regulation of any
applicable Canadian or U.S. federal, state, provincial or local jurisdiction,
including any filings in local real estate land record or registry offices,
which are necessary or advisable and shall do such other acts and execute such
other documents as may be required under any of the Loan Documents, from time
to time, in order to create, grant, maintain, register, record, file, perfect,
protect or preserve valid and perfected Liens on the Collateral in favor of the
Collateral Agent in the priorities purported to be created by the Security
Documents, subject only to Liens permitted under the Security Documents to be
senior or pari passu to the Liens of the Collateral Agent, and to fully
preserve and protect the rights of the Agents and the Lenders under this
Agreement and the other Loan Documents. Each of the Borrower and PAAC shall,
and shall cause the other Obligors to, pay and satisfy promptly all mortgage
and financing and continuation statement recording and/or filing fees, charges
and taxes relating to this Agreement, the Security Documents and the other Loan
Documents, any amendments thereto and any other instruments of further
assurance.
(c) Each of the Borrower and PAAC shall, on each anniversary of the
Closing Date beginning in the 1998 year, furnish to the Administrative Agent an
Opinion of Counsel, dated as of such date, either (a) to the effect that, in
the opinion of such counsel, such action has been taken with respect to the
recordings, registerings, filings, re-recordings, re-registerings and
refilings of all applications for registration, financing statements,
continuation statements or other instruments of further assurance as is
necessary to maintain the Lien of each of the Security Documents and reciting
with respect to such Liens the details of such action or referencing prior
Opinions of Counsel in which such details are given, and stating that all
financing statements and continuation statements have been executed and filed
that are necessary as of such date and during the succeeding twelve months
fully to preserve and protect the rights of the Collateral Agent, the Lenders
and the Administrative Agent hereunder and under each of the Security Documents
with respect to the Liens, or (b) to the effect that, in the opinion of such
counsel, no such action is necessary to maintain such Liens.
SECTION 7.1.11. Maintenance of Corporate Separateness. Each of the
Borrower and PAAC will, and will cause each of their respective Subsidiaries
to, satisfy customary corporate formalities, including the holding of regular
board of directors' and shareholders' meetings and the maintenance of corporate
offices and records. Neither the Borrower nor PAAC nor any of their respective
Restricted Subsidiaries shall make any payment to a creditor of any
Unrestricted Subsidiary in respect of any liability of such Unrestricted
Subsidiary, and no bank account of an Unrestricted Subsidiary shall be
commingled with any bank account of the Borrower, PAAC or any of their
respective Restricted Subsidiaries. Any financial statements distributed to
any creditors of an Unrestricted Subsidiary shall clearly establish the
separateness of such Unrestricted Subsidiary from the Borrower, PAAC and their
respective Restricted Subsidiaries. Neither the Borrower nor PAAC nor any of
their Subsidiaries shall take any action, or conduct
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its affairs in a manner, which is likely to result in the corporate
existence of any Unrestricted Subsidiary or any Restricted Subsidiary being
ignored by any court of competent jurisdiction, or in the assets and
liabilities of the Borrower, PAAC or any of their respective Restricted
Subsidiaries being substantively consolidated with those of any Unrestricted
Subsidiary in a bankruptcy, reorganization or other insolvency proceeding.
SECTION 7.1.12. Working Capital Line. The Borrower shall use its best
efforts to maintain a revolving credit facility or similar arrangement to the
extent it deems necessary based on its cash position and cash flows to fund the
foreseeable capital expenditure and working capital requirements of its
Restricted Subsidiaries.
SECTION 7.1.13. St. Xxxxxxx Pipeline. (a) Within 90 days after the
Arranger, the Syndication Agent and the Documentation Agent have notified the
Borrower in writing that they have reasonably determined in good faith that the
St. Xxxxxxx Pipeline has been substantially completed, each of PAAC and the
Borrower shall cause PCAC to use commercially reasonable efforts
(i) to grant to the Collateral Agent, for the pari passu benefit of
the Secured Parties (as defined in the Intercreditor Agreement) and as
additional security for the Indenture Obligations and the Term Loan
Obligations (as each such term is defined in the Intercreditor Agreement)
a perfected first-priority Lien (the "St. Xxxxxxx Xxxx") and
(ii) to deliver the following to the Collateral Agent:
(A) mortgages, security agreements, fixture filings and
financing statements (collectively, the "Pipeline Security
Documents") executed by PCAC and in form and substance acceptable to
the Arranger, the Syndication Agent, the Documentation Agent and the
Collateral Agent, sufficient to create the St. Xxxxxxx Xxxx, together
with evidence satisfactory to the Arranger, the Syndication Agent,
the Documentation Agent and the Collateral Agent that all of such
Pipeline Security Documents have been recorded and filed, as
necessary, to perfect such Lien and that all fees, taxes and other
expenses associated therewith have been paid;
(B) lien, title and Uniform Commercial Code financing statement
searches showing no Liens (other than Permitted Liens and any other
Liens acceptable to the Arranger, the Syndication Agent, the
Documentation Agent and the Collateral Agent) on the St. Xxxxxxx
Pipeline prior to the St. Xxxxxxx Xxxx;
(C) a complete set of as-built site plans, surveys or
engineering drawings, certified as true and correct by PCAC, and
showing all material components of the St. Xxxxxxx Pipeline and the
respective locations thereof;
(D) an opinion of local counsel to PCAC in Louisiana with
respect to the form and enforceability of the Pipeline Security
Documents and such other matters as the Arranger, the Syndication
Agent, the Documentation Agent, the Collateral Agent and their
respective counsel may reasonably require;
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(E) an opinion of counsel to PCAC with respect to the due
authorization, execution and delivery of the Pipeline Security
Documents and such other matters as the Arranger, the Syndication
Agent, the Documentation Agent, the Collateral Agent and their
respective counsel may reasonably require;
(F) certificates of insurance with respect to the insurance
coverage required to be maintained by PCAC in compliance with Section
8.1.4 with respect to the St. Xxxxxxx Pipeline, naming the Collateral
Agent as loss payee and naming the Collateral Agent as an additional
insured, as applicable; and
(G) such other approvals, consents, opinions or documents as
the Arranger, the Syndication Agent, the Documentation Agent, the
Collateral Agent or their respective counsel may reasonably request
in connection with the Pipeline Security Documents and any matter
related thereto;
(b) Each of PAAC and the Borrower shall cause PCAC to use its
commercially reasonable efforts to complete the St. Xxxxxxx Pipeline in a
timely manner.
SECTION 7.1.14. Pension Transfer Agreement. Each of PAAC and the Borrower
shall cause PCICC to fulfill all of its obligations under the Pension Transfer
Agreement referred to in the definition of "Acquisition Agreements" in
accordance with the terms thereof that relate to the establishment, funding,
maintenance and operation of the Canadian Pension Plan to be established in
connection therewith.
SECTION 7.2. Negative Covenants. The Borrower and PAAC agree with the
Agents and each Lender that, until the Term Loan Commitments have terminated,
and all Obligations have been paid and performed in full, the Borrower and PAAC
will perform the obligations set forth in this Section 7.2.
SECTION 7.2.1. Indebtedness. The Borrower and PAAC will not, and will
not permit any of their Restricted Subsidiaries to, directly or indirectly,
create, incur, issue, assume, guarantee or otherwise become liable with respect
to or become responsible for the payment of, contingently or otherwise
("incur"), any Indebtedness; provided, however, that the Borrower, PAAC or any
of their respective Restricted Subsidiaries may incur Indebtedness if at the
time of such incurrence and after giving pro forma effect thereto, PAAC's
Consolidated Cash Flow Coverage Ratio for the most recently ended four full
fiscal quarters for which internal financial statements are available
immediately preceding the date on which such Indebtedness is incurred,
calculated on a pro forma basis as if such Indebtedness was incurred on the
first day of such four full fiscal quarter period, would be at least 2.0 to
1.0. For purposes of determining PAAC's Consolidated Cash Flow Coverage Ratio,
Cash Flow and Consolidated Interest Expense for all periods prior to the
Closing Date shall be calculated on a consolidated basis including each of
PAAC's and its Subsidiaries' predecessors. Notwithstanding the foregoing
limitations, the incurrence of the following will not be prohibited:
(a) Indebtedness in respect of the Term Loans, the Guarantees and
all other Obligations;
(b) Indebtedness of PAAC evidenced by the Senior Secured Notes, the
Existing Senior Secured Notes and loans outstanding under the Existing
Term Loan Agreement
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and Indebtedness of the Borrower and the PAI Guarantors in respect of
guarantees of such Senior Secured Notes, Existing Senior Secured Notes and
loans outstanding under the Existing Term Loan Agreement;
(c) Indebtedness of PAAC or any of its Restricted Subsidiaries
constituting Existing Indebtedness and any extension, deferral, renewal,
refinancing or refunding thereof;
(d) Indebtedness of the Borrower, PAAC or any of their respective
Restricted Subsidiaries incurred under one or more Credit Facilities in an
aggregate principal amount at any one time outstanding not to exceed the
Borrowing Base at the time such Indebtedness was incurred, less the
aggregate amount of all permanent repayments of revolving loans under such
Credit Facilities made on account of the receipt by the Borrower, PAAC or
any such Restricted Subsidiary of proceeds from the sale of any of its
assets (as expressly permitted pursuant to the terms of any Senior
Indebtedness);
(e) Capitalized Lease Obligations of the Borrower, PAAC or any of
their respective Restricted Subsidiaries and Indebtedness of the Borrower,
PAAC or any of their respective Restricted Subsidiaries secured by Liens
that secure the payment of all or part of the purchase price of assets or
property acquired or constructed in the ordinary course of business after
the date hereof; provided, however, that the aggregate principal amount of
such Capitalized Lease Obligations plus such Indebtedness of the Borrower,
PAAC and all of their respective Restricted Subsidiaries does not exceed
$10,000,000 outstanding at any time;
(f) Indebtedness of PAAC to any Restricted Subsidiary of PAAC
(including to the Borrower or any Restricted Subsidiary of the Borrower)
or of any Restricted Subsidiary of PAAC (including the Borrower or any
Restricted Subsidiary of the Borrower) to PAAC or another Restricted
Subsidiary of PAAC (including the Borrower or any Restricted Subsidiary of
the Borrower);
(g) Indebtedness under Hedging Obligations; provided, however, that,
in the case of foreign currency exchange or similar agreements which
relate to other Indebtedness, such agreements do not increase the
Indebtedness of the Borrower, PAAC or any of their respective Restricted
Subsidiaries outstanding other than as a result of fluctuations in foreign
currency exchange rates, and in the case of interest rate protection
agreements, only if the notional principal amount of such interest rate
protection agreement does not exceed the principal amount of the
Indebtedness to which such interest rate protection agreement relates;
(h) Indebtedness in respect of performance, completion, guarantee,
surety and similar bonds, banker's acceptances or letters of credit
provided by the Borrower, PAAC or any of their respective Restricted
Subsidiaries in the ordinary course of business;
(i) in addition to any Indebtedness otherwise permitted to be
incurred pursuant to the preceding clauses (a) through (h), up to
$10,000,000 aggregate principal amount of Indebtedness at any one time
outstanding;
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(j) any refinancing, refunding, deferral, renewal or extension
(each, a "Refinancing") of any Indebtedness of the Borrower, PAAC or any
of their respective Restricted Subsidiaries permitted by the first
sentence of this Section or clause (b) above (the "Refinancing
Indebtedness"); provided, however, that (i) such Refinancing Indebtedness
does not exceed the aggregate principal amount of the Indebtedness so
refinanced, plus the amount of any premium required to be paid in
connection with such Refinancing in accordance with the terms of such
Indebtedness or the amount of any premium reasonably determined by the
Borrower or PAAC as necessary to accomplish such Refinancing, plus the
amount of reasonable and customary out-of-pocket fees and expenses payable
in connection therewith, (ii) the Refinancing Indebtedness does not
provide for any mandatory redemption, amortization or sinking fund
requirement in an amount greater than or at a time prior to the amounts
and times specified in the Indebtedness being refinanced, refunded,
deferred, renewed or extended and (iii) if the Indebtedness being
refinanced, refunded, deferred, renewed or extended is subordinated to the
Obligations, the Refinancing Indebtedness incurred to refinance, refund,
defer, renew or extend such Indebtedness is subordinated in right of
payment to the Obligations on terms at least as favorable to the Lenders
as those contained in the documentation governing the Indebtedness being
so refinanced, refunded, deferred, renewed or extended; and
(k) Indebtedness in respect of any guarantee provided by the
Borrower, PAAC or any of their respective Restricted Subsidiaries in
respect of any other Indebtedness permitted to be incurred pursuant to
this Section 7.2.1; provided, however, that in the event such Indebtedness
guaranteed is subordinated in right of payment to any other Indebtedness
of the obligor thereof, then such guarantee shall be subordinated to
Indebtedness of such guarantor to the same extent.
SECTION 7.2.2. Liens. The Borrower and PAAC will not, and will not
permit any of their respective Restricted Subsidiaries to, create, incur,
assume or suffer to exist any Lien upon any of their respective assets or
properties now owned or acquired after the date hereof, or any income or
profits therefrom, excluding, however, from the operation of the foregoing any
of the following:
(a) (i) Liens securing the Obligations, (ii) Liens on accounts
receivable, inventory and related general intangibles securing obligations
under the Revolving Credit Agreement, (iii) Liens securing the Senior
Secured Notes, the Existing Senior Secured Notes and the obligations under
the Existing Term Loan Agreement, and (iv) other Liens existing as of the
Closing Date or pursuant to an agreement or document in existence on the
Closing Date, in each case as set forth and described in Item 7.2.2(a)
("Existing Liens") of the Disclosure Schedule;
(b) Permitted Liens;
(c) Liens on assets or property of the Borrower or PAAC, or on
assets or property of any of their respective Restricted Subsidiaries, to
secure the payment of all or a part of the purchase price of assets or
property acquired or constructed in the ordinary course of business after
the Closing Date; provided, however, that (i) the aggregate principal
amount of Indebtedness secured by such Liens does not exceed the original
cost or purchase price of the assets or property so acquired (including
the reasonable and
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customary costs of installation of such acquired assets) or constructed,
(ii) the Indebtedness secured by such Liens is otherwise permitted to be
incurred hereunder, (iii) such Liens do not encumber any other assets or
property of the Borrower, PAAC or any of their respective Restricted
Subsidiaries and (iv) the Indebtedness secured by such Liens may not be
created more than 100 days after the later of the acquisition, completion
of construction, repair, improvement, addition or commencement of full
operation of the property subject to such Liens;
(d) Liens on assets or property acquired by the Borrower, PAAC or
any of their respective Restricted Subsidiaries after the Closing Date;
provided, however, that (i) such Liens existed on the date such assets or
property were acquired and were not incurred as a result of or in
anticipation of such acquisition and (ii) such Liens do not extend to or
cover any assets or property of the Borrower, PAAC or any of their
respective Restricted Subsidiaries other than the assets or property so
acquired;
(e) Liens securing Indebtedness which is incurred to refinance
Indebtedness which has been secured by a Lien permitted hereunder and
which is permitted to be refinanced hereunder; provided, however, that
such Liens do not extend to or cover any assets or property of the
Borrower, PAAC or any of their respective Restricted Subsidiaries not
securing the Indebtedness so refinanced;
(f) Liens on assets or property of the Borrower, PAAC or any of
their respective Restricted Subsidiaries that is subject to a Sale and
Leaseback Transaction; provided, however, that the aggregate principal
amount of Attributable Indebtedness in respect of all Sale and Leaseback
Transactions then outstanding does not at the time such a Lien is incurred
exceed $10,000,000;
(g) Liens on property or shares of Capital Stock of a Person at the
time such Person becomes a Restricted Subsidiary of the Borrower or PAAC;
provided, however, that such Liens are not created, incurred or assumed in
contemplation of the acquisition thereof by the Borrower, PAAC or a
Subsidiary of the Borrower or PAAC; provided, further, that such Liens may
not extend to any other property owned by the Borrower, PAAC or any of
their respective Restricted Subsidiaries;
(h) (i) Liens securing Indebtedness of a Restricted Subsidiary of
any PCIFP Company owing such PCIFP Company or any other PCIFP Company or a
Wholly-Owned Restricted Subsidiary of such PCIFP Company or such other
PCIFP Company and (ii) Liens securing Indebtedness of a Restricted
Subsidiary of PAAC (other than a PCIFP Company or any of its Restricted
Subsidiaries) owing to PAAC or a Wholly-Owned Restricted Subsidiary of
PAAC (other than a PCIFP Company or any of its Restricted Subsidiaries);
(i) Liens on inventory, accounts receivable or related general
intangibles of any Restricted Subsidiary securing Indebtedness which may
be incurred under clause (d) of Section 7.2.1;
(j) Liens on collateral securing Indebtedness under the Existing
Senior Secured Notes and the Existing Term Loan Agreement up to an
aggregate principal amount of $50,000,000 of Indebtedness permitted to be
incurred under the first sentence of
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Section 7.2.1; provided that (i) the proceeds of such Indebtedness are
used to acquire or construct additional property, plant and equipment that
will be utilized in one or more Related Businesses and (ii) the aggregate
principal amount of Indebtedness secured by such Liens does not exceed the
original cost or purchase price of the assets or property so acquired
(including the reasonable and customary costs of installation of such
acquired assets) or constructed; and
(k) Liens on assets or property of the Borrower or PAAC, or on
assets or property of any of their respective Restricted Subsidiaries,
acquired or constructed after the Closing Date other than in the ordinary
course of business and other than assets or property acquired or
constructed in replacement, repair or improvement of any assets or
property constituting Collateral; provided, however, that (i) the
aggregate principal amount of Indebtedness secured by such Liens does not
exceed the original cost or purchase price of the assets or property so
acquired (including the reasonable and customary costs of installation of
such acquired assets) or constructed, (ii) the Indebtedness secured by
such Liens is otherwise permitted to be incurred hereunder and (iii) such
Liens do not encumber any Collateral.
SECTION 7.2.3. Restricted Payments, etc. PAAC will not, nor will it
cause, permit or suffer any of its Restricted Subsidiaries (including the
Borrower and its Restricted Subsidiaries) to, (i) declare or pay any dividends
or make any other distributions (including through mergers, amalgamations,
liquidations or other transactions commonly known as leveraged buyouts) on any
class of Equity Interests of PAAC or such Restricted Subsidiary (other than
dividends or distributions payable or paid by a Wholly-Owned Restricted
Subsidiary of PAAC on account of its Equity Interests held by PAAC or another
Restricted Subsidiary or payable or paid in shares of Capital Stock of PAAC
other than Redeemable Stock), (ii) make any payment on account of, or set apart
money for a sinking or other analogous fund for, the purchase, redemption or
other retirement of such Equity Interests, (iii) purchase, defease, redeem or
otherwise retire any Subordinated Indebtedness or (iv) make any Restricted
Investment, either directly or indirectly, whether in cash or property or in
obligations of the Borrower, PAAC or any of their respective Restricted
Subsidiaries (all of the foregoing being called "Restricted Payments"), unless,
(x) in the case of a dividend, such dividend is payable not more than 60 days
after the date of declaration and (y) after giving effect to such proposed
Restricted Payment, all the conditions set forth in clauses (1) through (3)
below are satisfied (A) at the date of declaration (in the case of any
dividend), (B) at the date of such setting apart (in the case of any such fund)
or (C) on the date of such other payment or distribution (in the case of any
other Restricted Payment) (each such date being referred to as a "Restricted
Payment Computation Date"):
(1) no Default or Event of Default has occurred and is continuing or
would result from the making of such Restricted Payment;
(2) at the Restricted Payment Computation Date for such Restricted
Payment and after giving effect to such Restricted Payment on a pro forma
basis, PAAC or such Restricted Subsidiary could incur $1.00 of additional
Indebtedness pursuant to the first sentence of Section 7.2.1; and
(3) the aggregate amount of Restricted Payments declared, paid or
distributed subsequent to the date hereof (including the proposed
Restricted Payment) will not exceed the sum of (i) 50% of the cumulative
Consolidated Net Income of PAAC for the
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period subsequent to October 1, 1997 to and including the last day of
PAAC's last fiscal quarter ending prior to the Restricted Payment
Computation Date (each such period to constitute a "Restricted Payment
Computation Period") (or, if such aggregate cumulative Consolidated Net
Income is a loss, minus 100% of such loss of PAAC during the Restricted
Payment Computation Period), (ii) the aggregate Net Cash Proceeds of the
issuance or sale or the exercise (other than to a Subsidiary or an
employee stock ownership plan or other trust established by the Borrower,
PAAC or any of their respective Subsidiaries for the benefit of their
employees) of PAAC's Equity Interests (other than Redeemable Stock)
subsequent to the Closing Date, (iii) the aggregate Net Cash Proceeds of
the issuance or sale (other than to a Subsidiary) of any debt securities
of PAAC that have been converted into or exchanged for Equity Interests
(other than Redeemable Stock) of PAAC to the extent such debt securities
were originally issued or sold for cash, plus the aggregate Net Cash
Proceeds received by PAAC at the time of such conversion or exchange, in
each case subsequent to the Closing Date, (iv) cash contributions to
PAAC's capital subsequent to the Closing Date and (v) $5,000,000.
If no Default or Event of Default has occurred and is continuing or would occur
as a result thereof, the prohibitions set forth above are subject to the
following exceptions: (A) Restricted Investments in obligations representing a
portion of the proceeds of any Asset Sale consummated in accordance with
Section 7.2.6; provided, however, that such Restricted Investments will be
excluded in the calculation of the amount of Restricted Payments previously
made for purposes of clause (3) above; (B) any purchase or redemption of Equity
Interests or Subordinated Indebtedness made by exchange for, or out of the
proceeds of the substantially concurrent sale of, Equity Interests of PAAC
(other than Redeemable Stock and other than Equity Interests issued or sold to
a Subsidiary or an employee stock ownership plan); provided, however, that (x)
such purchase or redemption will be excluded in the calculation of the amount
of Restricted Payments previously made for purposes of clause (3) above and (y)
the Net Cash Proceeds from such sale will be excluded for purposes of clause
(3) above to the extent utilized for purposes of such purchase or redemption;
(C) any purchase or redemption of Subordinated Indebtedness of PAAC made by
exchange for, or out of the proceeds of the substantially concurrent sale of,
Subordinated Indebtedness of PAAC or any Restricted Subsidiary of PAAC which is
permitted to be issued pursuant to Section 7.2.1; provided, however, that such
purchase or redemption will be excluded in the calculation of the amount of
Restricted Payments previously made for purposes of clause (3) above; (D) the
repurchase, redemption or other acquisition or retirement for value of Capital
Stock of PAAC or PCI held by management or other employees of the PCI, PAAC or
any Restricted Subsidiary of PAAC pursuant to any shareholders agreement,
management or employee stock option agreement or management or employee equity
subscription agreement, in accordance with the provisions of any such
arrangement, in an amount not greater than $500,000 in any calendar year plus
the portion of any such amounts which remains unused at the end of the two
prior calendar years, but in no event to exceed $1,500,000 in any calendar
year; provided, however, that any such repurchase, redemption, acquisition or
retirement for value will be excluded in the calculation of the amount of
Restricted Payments previously made for purposes of clause (3) above; (E)
payments to PCI pursuant to any tax sharing arrangement so long as payments
thereunder do not exceed the amount of PAAC and its consolidated Subsidiaries'
share of Federal and state income taxes actually paid or to be paid by PAAC;
provided, however, that such payments will be excluded in the calculation of
the amount of Restricted Payments previously made for purposes of clause (3)
above; (F) payments to PCI to perform accounting, legal, corporate reporting
and administrative functions in the ordinary course of business in an amount
not greater than $500,000 in any calendar year, or to
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pay required fees in connection with the Acquisition and related
transactions, including the registration under applicable laws and
regulations of its debt or equity securities issued in connection
therewith; provided, however, that such payments will be excluded in the
calculation of the amount of Restricted Payments previously made for purposes
of clause (3) above; and (G) Investments described in clause (vi) of the
definition of Permitted Investments; provided, however, that such Investments
will be included in the calculation of the amount of Restricted Payments
previously made for purposes of clause (3) above.
For purposes of this Section, (a) the amount of any Restricted Payment
declared, paid or distributed in property of PAAC or any of its Restricted
Subsidiaries will be deemed to be the net book value of any such property that
is intangible property and the Fair Market Value (as determined by and set
forth in a resolution of the Board of Directors of PAAC) of any such property
that is tangible property at the Restricted Payment Computation Date, in each
case, after deducting related reserves for depreciation, depletion and
amortization; (b) the amount of any Restricted Payment declared, paid or
distributed in obligations of PAAC or any of its Restricted Subsidiaries will
be deemed to be the principal amount of such obligations as of the date of the
adoption of a resolution by the Board of Directors of PAAC or such Restricted
Subsidiary authorizing such Restricted Payment; and (c) a distribution to
holders of PAAC's Equity Interests of (i) shares of Capital Stock or other
Equity Interests of any Restricted Subsidiary of PAAC or (ii) other assets of
PAAC, without, in either case, the receipt of equivalent consideration therefor
will be regarded as the equivalent of a cash dividend equal to the excess of
the Fair Market Value of the Equity Interests or other assets being so
distributed at the time of such distribution over the consideration, if any,
received therefor. Not later than the date of the making of any such
Restricted Payment, PAAC shall deliver to the Administrative Agent a
certificate of an Authorized Officer certifying that such Restricted Payment is
permitted, attaching a copy of the applicable resolution of the Board of
Directors pursuant to which the value of the Restricted Payment to be made was
determined and setting forth the basis upon which the calculations required by
this Section were computed.
SECTION 7.2.4. Payment Restrictions Affecting Guarantors. The Borrower
and PAAC will not, and will not permit any of their respective Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any consensual encumbrance or restriction of any kind
on the ability of any such Restricted Subsidiary to (i) pay dividends or make
any other distribution to PAAC or any of its Restricted Subsidiaries on its
Equity Interests, (ii) pay any Indebtedness owed to PAAC or any other such
Restricted Subsidiary, (iii) make loans or advances to PAAC or any other such
Restricted Subsidiary or (iv) transfer any of its property or assets to PAAC or
any other such Restricted Subsidiary except:
(a) consensual encumbrances or restrictions contained in or created
pursuant to the Revolving Credit Agreement, the Security Documents, the
Intercreditor Agreement, Senior Secured Notes, the Senior Secured Note
Indenture, Existing Senior Secured Notes (if any), the Existing Senior
Secured Note Indenture and the Existing Term Loan Agreement (including the
security documents relating thereto);
(b) consensual encumbrances or restrictions in the Senior Secured
Notes (if any) and the Senior Secured Note Indenture;
(c) any restriction, with respect to a Restricted Subsidiary of PAAC
that is not a Restricted Subsidiary of PAAC on the Closing Date, in
existence at the time such entity
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becomes a Restricted Subsidiary of PAAC; provided that such encumbrance or
restriction is not created in anticipation of or in connection with such
entity becoming a Restricted Subsidiary of PAAC and is not applicable to
any Person or the properties or assets of any Person other than a Person
that becomes a Restricted Subsidiary of PAAC;
(d) any encumbrances or restrictions pursuant to an agreement
effecting a refinancing of Indebtedness referred to in clause (a) or (c)
of this Section or contained in any amendment to any agreement creating
such Indebtedness, provided that the encumbrances and restrictions
contained in any such refinancing or amendment are not materially more
restrictive taken as a whole (as determined in good faith by the chief
financial officer of PAAC) than those provided for in such Indebtedness
being refinanced or amended;
(e) encumbrances or restrictions contained in any other Indebtedness
permitted to be incurred subsequent to the Closing Date pursuant to
Section 7.2.1, provided that any such encumbrances or restrictions are not
materially more restrictive taken as a whole (as determined in good faith
by the chief financial officer of PAAC) than the most restrictive of those
provided for in the Indebtedness referred to in clause (a), (b) or (c) of
this Section;
(f) any such encumbrance or restriction consisting of customary
nonassignment provisions in leases governing leasehold interests to the
extent such provisions restrict the transfer of the lease;
(g) any restriction with respect to a Restricted Subsidiary of PAAC
imposed pursuant to an agreement entered into for the sale or disposition
of all or substantially all of the Capital Stock or assets of such
Restricted Subsidiary in compliance with the provisions hereof pending the
closing of such sale or disposition; or
(h) any encumbrance or restriction due to applicable law.
SECTION 7.2.5. Consolidation, Merger, etc. (a) Neither the Borrower nor
PAAC will consolidate with, merge into or amalgamate with, or sell, assign,
convey, lease or transfer all or substantially all of its assets and those of
its Subsidiaries taken as a whole to, any Person, unless
(i) the resulting, surviving or transferee Person expressly assumes
all the obligations of the Borrower or PAAC, as the case may be, under
this Agreement, the Term Notes and each other Loan Document to which the
Borrower or PAAC, as the case may be, is a party pursuant to amendments in
form and substance reasonably satisfactory to the Administrative Agent and
the Required Lenders;
(ii) such Person is organized and existing under the laws of the
United States of America, a state thereof or the District of Columbia, or,
in the case of PCICC, Canada or a province thereof;
(iii) at the time of the occurrence of such transaction and after
giving effect to such transaction on a pro forma basis, such Person could
incur $1.00 of additional Indebtedness pursuant to the first sentence of
Section 7.2.1 (assuming a market rate of interest with respect to such
additional Indebtedness);
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(iv) at the time of the occurrence of such transaction and after
giving effect to such transaction on a pro forma basis, the Consolidated
Net Worth of such Person is equal to or greater than the Consolidated Net
Worth of the Borrower or PAAC, as the case may be, immediately prior to
such transaction;
(v) each Guarantor, to the extent applicable, will acknowledge and
confirm in writing that its Guaranty will apply to such Person's
obligations under this Agreement, the Term Notes and each other Loan
Document to which it is (or will become) a party; and
(vi) immediately before and immediately after giving effect to such
transaction and treating any Indebtedness which becomes an obligation of
the Borrower, PAAC or any of their respective Restricted Subsidiaries or
of such Person as a result of such transaction as having been incurred by
the Borrower, PAAC or such Restricted Subsidiary or such Person, as the
case may be, at the time of such transaction, no Default or Event of
Default shall have occurred and be continuing.
The Borrower or PAAC, as the case may be, shall deliver to the
Administrative Agent prior to the consummation of the proposed transaction an
Officers' Certificate to the foregoing effect and an Opinion of Counsel,
covering clauses (i), (ii), (v) and (vi) above, stating that the proposed
transaction and such amendments comply with this Agreement.
(b) No PAI Guarantor will, and the Borrower and PAAC will not permit any
PAI Guarantor to, in a single transaction or series of related transactions
merge, amalgamate or consolidate with or into any other Person (other than, in
the case of a Restricted Subsidiary of a PCIFP Company, such PCIFP Company), in
the case of a PCIFP Company, another PCIFP Company, or in the case of any other
PAI Guarantor, the Borrower or PAAC (provided that the Borrower or PAAC, as the
case may be, would be in compliance with the other terms of this Agreement,
including the preceding paragraph (a)), or any other PAI Guarantor), or sell,
assign, convey, transfer, lease or otherwise dispose of all or substantially
all of its properties and assets to any Person (other than, in the case of a
Restricted Subsidiary of a PCIFP Company, such PCIFP Company), in the case of a
PCIFP Company, another PCIFP Company, or in the case any other PAI Guarantor,
the Borrower or PAAC (provided that the Borrower or PAAC, as the case my be,
would be in compliance with the other terms of this Agreement, including the
preceding paragraph (a)), or any other PAI Guarantor) unless at the time and
giving effect thereto: (i) either (1) such PAI Guarantor is the continuing
corporation or (2) the Person (if other than such PAI Guarantor) formed by such
consolidation or into which such PAI Guarantor is merged or the Person which
acquires by sale, assignment, conveyance, transfer, lease or disposition the
properties and assets of such PAI Guarantor is a corporation duly organized and
validly existing under the laws of the United States of America, any state
thereof, the District of Columbia or Canada or a province thereof and expressly
assumes all the obligations of such PAI Guarantor under the applicable PAI
Guaranty and each other Loan Document to which it is a party pursuant to
amendments in form and substance reasonably satisfactory to the Administrative
Agent and the Required Lenders; and (ii) immediately before and immediately
after giving effect to such transaction, no Default or Event of Default shall
have occurred and be continuing. Such PAI Guarantor shall deliver to the
Administrative Agent prior to the consummation of the proposed transaction, in
form and substance reasonably satisfactory to the Administrative Agent, an
Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, amalgamation, sale, assignment, conveyance, transfer,
lease or disposition and such
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amendments, if required, comply with this Agreement. The provisions of this
paragraph (b) will not apply to any transaction (including any Asset Sale made
in accordance with Section 7.2.6) with respect to any PAI Guarantor if the
applicable PAI Guaranty of such PAI Guarantor is released in connection with
such transaction in accordance with the applicable provisions of this Agreement
and the other Loan Documents. Upon any sale, exchange, transfer or other
disposition to any Person of all of the Borrower's, PAAC's or their respective
Restricted Subsidiaries' Equity Interests in, or all or substantially all of
the assets of, any PAI Guarantor which is in compliance with this Agreement and
the other Loan Documents, such PAI Guarantor will be released from all its
obligations under the PAI Guaranty to which it is party.
(c) Upon any consolidation, merger or amalgamation, or any sale,
assignment, conveyance, transfer or disposition of all or substantially all of
the properties and assets of the Borrower, PAAC or any PAI Guarantor in
accordance with the foregoing provisions of this Section 7.2.5, the successor
Person formed by such consolidation or into which the Borrower, PAAC or such
PAI Guarantor, as the case may be, is merged or the successor Person to which
such sale, assignment, conveyance, transfer, lease or disposition is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Borrower, PAAC or such PAI Guarantor, as the case may be, under this
Agreement, the Term Notes and/or the applicable PAI Guaranty, as the case may
be, with the same effect as if such successor had been named as the Borrower,
PAAC or such PAI Guarantor, as the case may be, herein, in the Term Notes
and/or in such PAI Guaranty, as the case may be. When a successor assumes all
the obligations of its predecessor under this Agreement, the Term Notes or the
applicable PAI Guaranty, as the case may be, the predecessor shall be released
from those obligations; provided, that in the case of a transfer by lease, the
predecessor shall not be released from the payment of principal and interest
on, or any other Obligation relating to, this Agreement, the Term Notes or such
PAI Guaranty, as the case may be.
SECTION 7.2.6. Asset Dispositions, etc. (a) The Borrower and PAAC will
not, and will not permit any of their Restricted Subsidiaries to, make any
Asset Sale (other than, in the case of a PCIFP Company or a Restricted
Subsidiary of such PCIFP Company, to such PCIFP Company or another Restricted
Subsidiary of such PCIFP Company, and, in the case of PAAC or a Restricted
Subsidiary of PAAC (other than a PCIFP Company and its Restricted
Subsidiaries), to PAAC or another Restricted Subsidiary of PAAC (other than a
PCIFP Company and its Restricted Subsidiaries)) unless (i) the Borrower, PAAC
or such Restricted Subsidiary receives consideration at the time of such Asset
Sale at least equal to the Fair Market Value of the assets sold or otherwise
disposed of, and at least 80% of the consideration received by the Borrower,
PAAC or such Restricted Subsidiary from such Asset Sale is in the form of cash
and no portion thereof shall consist of inventory or accounts receivable or
other property that would become subject to a Lien held by any other creditor
of the Borrower, PAAC or of their respective Restricted Subsidiaries; provided,
however, that the amount of any cash equivalent or note or other obligation
received by the Borrower, PAAC or such Restricted Subsidiary from the
transferee in any such transaction that is converted within 90 days by the
Borrower, PAAC or such Restricted Subsidiary into cash will be deemed upon such
conversion to be cash for purposes of this provision; (ii) to the extent such
Asset Sale involves Collateral, (x) the consent of the Required Lenders shall
be obtained prior to the consummation of such sale and (y) the Borrower and
PAAC shall cause the aggregate cash proceeds received by any PCIFP Company or
any of its Restricted Subsidiaries, in respect of such Asset Sale which are
allocated to the Collateral, net of the items set forth in clauses (i) through
(vi) of the definition of Net Proceeds (the "Collateral Proceeds") to be
deposited with the Collateral Agent in the Intercreditor
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Collateral Account as and when received by any PCIFP Company or any of its
Restricted Subsidiaries and shall otherwise comply with the Intercreditor
Agreement; and (iii) the Net Proceeds received by the Borrower, PAAC or such
Restricted Subsidiary from such Asset Sale are applied in accordance with the
following paragraphs.
(b) (i) When the aggregate amount of Net Proceeds from all PAAC Asset
Sales since June 17, 1997 exceeds $35,000,000, the Borrower and PAAC shall
apply, subject to Section 3.1.2 and the provisions, if applicable, of the
Intercreditor Agreement, 100% of such Net Proceeds in excess of $35,000,000
(including 100% of the Net Proceeds of each PAAC Asset Sale subsequent to the
PAAC Asset Sale which results in Net Proceeds from all PAAC Asset Sales since
June 17, 1997 exceeding $35,000,000) that are not required pursuant to the
terms of the Existing Term Loan Agreement or the Existing Senior Secured Notes,
in each case as in effect on the date hereof, to prepay or purchase
Indebtedness outstanding under the Existing Term Loan Agreement or the Existing
Senior Secured Notes, respectively, to prepay the Term Loans on or prior to the
tenth Business Day following the date on which such Net Proceeds are received
by PAAC or its applicable Restricted Subsidiary at a price equal to 100% of the
principal amount thereof, plus accrued interest thereon to the date of
prepayment.
(ii) When the aggregate amount of Net Proceeds from all PCIFP Asset Sales
since the Closing Date exceeds $35,000,000, the Borrower and PAAC shall apply,
subject to Section 3.1.2 and the provisions, if applicable, of the
Intercreditor Agreement, 100% of such Net Proceeds in excess of $35,000,000
(including 100% of the Net Proceeds of each PCIFP Asset Sale subsequent to the
PCIFP Asset Sale which results in Net Proceeds from all PCIFP Asset Sales since
the date hereof exceeding $35,000,000) to prepay the Term Loans on or prior to
the tenth Business Day following the date on which such Net Proceeds are
received by any PCIFP Company or any of their Restricted Subsidiaries at a
price equal to 100% of the principal amount thereof, plus accrued interest
thereon to the date of prepayment.
(c) If all or a portion of the Net Proceeds of any Asset Sale are not
required to be applied to prepay the Term Loans pursuant to the preceding
paragraph (b), then the Borrower or PAAC may, within 365 days of such Asset
Sale, invest Net Proceeds resulting from a PAAC Asset Sale in PAAC or in one or
more of its Restricted Subsidiaries (other than a PCIFP Company or one of its
Restricted Subsidiaries) engaged in a Related Business and invest Net Proceeds
resulting from a PCIFP Asset Sale in the PCIFP Company whose assets were sold
or in one or more of such PCIFP Company's Restricted Subsidiaries engaged in a
Related Business. The amount of such Net Proceeds not used to or invested as
set forth in this paragraph shall be applied by the Borrower or PAAC, subject
to Section 3.1.2 and the provisions, if applicable, of the Intercreditor
Agreement, to the prepayment of the Term Loans on or prior to the tenth
Business Day following the date such Net Proceeds are not so used or invested
at a price equal to 100% of the principal amount thereof, plus accrued interest
thereon to the date of prepayment; provided, however, that to the extent such
Net Proceeds are subject to Section 1009 of the Senior Secured Note Indenture,
the principal amount of Term Loans required to be prepaid on account of such
Net Proceeds shall not exceed the Pro Rata Share (as defined in the
Intercreditor Agreement) of such Net Proceeds applicable to the Term Loans.
(d) Until such time as the Net Proceeds from any Asset Sale are applied
in accordance with this Section, such Net Proceeds will be segregated from the
other assets of the Borrower, PAAC and their respective Subsidiaries and
invested in cash or Eligible Investments, except that the Borrower, PAAC or
their relevant Restricted Subsidiary may use any Net Proceeds pending
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the utilization thereof in the manner (and within the time period)
described above, and (except as to Collateral Proceeds) to repay revolving
loans (under the Revolving Credit Agreement or otherwise) without a permanent
reduction of the commitment thereunder.
(e) The Borrower and PAAC will not, and will not permit any of their
Restricted Subsidiaries to, create or permit to exist or become effective any
consensual restriction other than restrictions not more restrictive taken as a
whole (as determined in good faith by the chief financial officer of PAAC) than
those in effect under Existing Indebtedness and the Revolving Credit Agreement
that would materially impair the ability of the Borrower or PAAC to comply with
the provisions of this Section.
(f) If at any time any non-cash consideration (other than any such
consideration consisting of inventory, accounts receivable and certain related
assets securing or permitting to secure the Revolving Credit Agreement) is
received by the Borrower, PAAC or any of their Restricted Subsidiaries, as the
case may be, in connection with any Asset Sale of assets which includes
Collateral, such non-cash consideration shall be made subject to the Lien of
the applicable Security Document in the manner contemplated in the
Intercreditor Agreement to the extent of the purchase price allocated to such
Collateral. If and when any such non-cash consideration received from any
Asset Sale (whether or not relating to Collateral) is converted into or sold or
otherwise disposed of for cash, then such conversion or disposition shall be
deemed to constitute an Asset Sale hereunder and the Net Proceeds thereof shall
be applied in accordance with this Section 7.2.6.
(g) All Insurance Proceeds and all Net Awards required to be delivered to
the Collateral Agent pursuant to any Security Document shall constitute Trust
Moneys and shall be delivered by the Borrower, PAAC or the applicable
Restricted Subsidiary of PAAC, as the case may be, to the Collateral Agent
contemporaneously with receipt by the Borrower, PAAC or such Restricted
Subsidiary and be deposited into the Intercreditor Collateral Account and
applied in accordance with the applicable provisions of the Intercreditor
Agreement. Insurance Proceeds and Net Awards so deposited that may be applied
by the Borrower, PAAC or such Restricted Subsidiary to effect a Restoration of
the affected Collateral under the applicable Security Agreement may be
withdrawn from the Intercreditor Collateral Account only in accordance with the
applicable provisions of the Intercreditor Agreement. Insurance Proceeds and
Net Awards so deposited that are not applied to effect a Restoration of the
affected Collateral under such Security Document may only be withdrawn in
accordance with applicable provisions of the Intercreditor Agreement.
SECTION 7.2.7. Modification of Certain Agreements. The Borrower and PAAC
will not, and will not permit any of their Restricted Subsidiaries to, amend,
modify or supplement, or permit or consent to any amendment, modification or
supplement of, (i) the Security Documents in any manner or to any extent that
would constitute an Event of Default hereunder or under the Security Documents
(provided that this Agreement and the Security Documents may be amended,
modified or supplemented as set forth in Section 10.1), (ii) the Purchase
Agreement or any other Acquisition Agreement, except to the extent such
amendment, modification or supplement would not have an adverse effect on the
Lenders, (iii) the Senior Secured Notes, the Senior Secured Note Indenture, the
Existing Senior Secured Notes, the Existing Senior Secured Note Indenture and
the Existing Term Loan Agreement, except to the extent such amendment,
modification or supplement would not have a material adverse effect on the
Lenders (it being acknowledged by each of the Borrower and PAAC that, without
limitation, any increase in the interest rate on the Senior Secured Notes, the
Existing Senior Secured Notes or the loans under
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the Existing Term Loan Agreement, any reduction in the tenor or average life
thereof and any modification of (including any addition to) the covenants,
defaults and remedies set forth therein or applicable thereto (without a
corresponding modification to the covenants, defaults, defaults and remedies
applicable to the Obligations) which make such provisions more burdensome as a
whole to the Borrower, PAAC and their respective Restricted Subsidiaries shall
in each case be deemed to be materially adverse to the Lenders) or (iv) the
Revolving Credit Agreement, except to the extent such amendment, modification
or supplement would not have a material adverse effect on the Lenders (it being
acknowledged by each of the Borrower and PAAC that the extension or similar
modification of any grace period set forth therein shall in each case be deemed
to be materially adverse to the Lenders).
SECTION 7.2.8. Transactions with Affiliates. (a) The Borrower, PAAC and
their respective Restricted Subsidiaries will not, directly or indirectly,
enter into any transaction or series of related transactions with or for the
benefit of any of their respective Affiliates (other than, in the case of a
PCIFP Company or one of its Restricted Subsidiaries, with such PCIFP Company or
one of its other Restricted Subsidiaries, or, in the case of PAAC or one of its
Restricted Subsidiaries (other than a PCIFP Company or one of its Restricted
Subsidiaries), with PAAC or one of its other Restricted Subsidiaries (other
than a PCIFP Company or one of its Restricted Subsidiaries)), except on an
arm's-length basis and if (x)(i) in the case of any such transaction in which
the aggregate rental value, remuneration or other consideration (including the
value of a loan), together with the aggregate rental value, remuneration or
other consideration (including the value of a loan) of all such other
transactions consummated in the year during which such transaction is proposed
to be consummated, exceeds $750,000, the Borrower or PAAC, as applicable,
delivers Board Resolutions to the Administrative Agent evidencing that the
Board of Directors and the Independent Directors that are disinterested each
have (by a majority vote) determined in good faith that the aggregate rental
value, remuneration or other consideration (including the value of any loan)
inuring to the benefit of such Affiliate from any such transaction is not
greater than that which would be charged to or extended by the Borrower, PAAC
or any of their Subsidiaries, as the case may be, on an arm's-length basis for
similar properties, assets, rights, goods or services by or to a Person not
affiliated with the Borrower, PAAC or any of their Subsidiaries, as the case
may be, and (ii) in the case of any such transaction in which the aggregate
rental value, remuneration or other consideration (including the value of any
loan), together with the aggregate rental value, remuneration or other
consideration (including the value of any loan) of all such other transactions
consummated in the year during which such transactions are proposed to be
consummated, exceeds $7,500,000, the Borrower or PAAC, as applicable, delivers
to the Administrative Agent Board Resolutions as described in clause (x)(i)
above and an opinion of a nationally recognized investment banking firm,
unaffiliated with the Borrower or PAAC, as applicable, and the Affiliate which
is party to such transaction, to the effect that the aggregate rental price,
remuneration or other consideration (including the value of a loan) inuring to
the benefit of such Affiliate from any such transaction is not greater than
that which would be charged to or extended by the Borrower, PAAC or any of
their Subsidiaries, as the case may be, on an arm's-length basis for similar
properties, assets, rights, goods or services by or to a Person not affiliated
with the Borrower, PAAC or any of their Subsidiaries, as the case may be, and
(y) all such transactions referred to in clauses (x)(i) and (ii) above are
entered into in good faith. Any transaction required to be approved by
Independent Directors pursuant to the preceding paragraph must be approved by
at least one such Independent Director.
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(b) The provisions of the preceding paragraph do not prohibit (i) any
Restricted Payment permitted to be paid pursuant to Section 7.2.3, (ii) any
Investment made in Kemwater during a period of three years following the
Closing Date, provided that such Investment matures or is required to be
redeemed within one year of its being made, (iii) any issuance of securities,
or other payments, awards or grants in cash, securities or otherwise pursuant
to, or the funding of, employment arrangements, stock options and stock
ownership plans approved by the Board of Directors, (iv) loans or advances to
employees in the ordinary course of business consistent with past practices,
not to exceed $500,000 aggregate principal amount outstanding at any time, (v)
the payment of fees and compensation to, and indemnity provided on behalf of,
officers, directors, employees or consultants of the Borrower, PAAC or any of
their Subsidiaries, as determined by the board of directors of the Borrower,
PAAC or any of their Subsidiaries in good faith and (vi) Existing Affiliate
Agreements, including amendments thereto entered into after the Closing Date
provided that the terms of any such amendment either (A) are not, in the
aggregate, less favorable to PAAC than the terms of such agreement prior to
such amendment, or (B) if such terms are, in the aggregate, less favorable to
PAAC such amendment satisfies the requirements of the preceding paragraph.
SECTION 7.2.9. Impairment of Security Interest. (a) The Borrower and
PAAC will not, and will not cause or permit any of their Restricted
Subsidiaries to, take or omit to take any action which action or omission might
or would have the result of affecting or impairing the Liens and security
interest in favor of the Administrative Agent for the benefit of the Lenders
with respect to the Collateral and the Borrower and PAAC will not grant to any
Person, or suffer any Person to have any interest whatsoever in the Collateral,
in each case other than as otherwise permitted by this Agreement, the Senior
Secured Note Indenture or the Security Documents. The Borrower and PAAC will
not, and will not permit PCAC to, grant a security interest in, or permit any
Lien to exist on, the St. Xxxxxxx Pipeline other than Permitted Liens and Liens
in favor of the Collateral Agent pursuant to a Security Document.
(b) The Borrower and PAAC will not, and will not cause or permit any of
their Restricted Subsidiaries to, enter into any agreement or instrument that
by its terms requires that the proceeds received from any sale of Collateral be
applied to repay, redeem, defease or otherwise acquire or retire any
Indebtedness of any Person, other than pursuant to this Agreement or the Senior
Secured Indenture. A release of any of the Collateral strictly in accordance
with the terms and conditions of this Agreement and the Security Documents will
not be deemed for any purpose to be an impairment of security under this
Agreement.
(c) Subject to the provisions of this Agreement, the Existing Term Loan
Agreement and the Intercreditor Agreement, the Borrower and PAAC will not, and
will not cause or permit any of their Restricted Subsidiaries to, enter into
any agreement or instrument that by its terms requires that the Borrower, PAAC
or any such Restricted Subsidiary pledge the Capital Stock of (i) any PCIFP
Company and any of its Restricted Subsidiaries and (ii) any other Restricted
Subsidiary of PAAC that (A) is engaged in any business activity other than the
holding of the Capital Stock of one or more Subsidiaries of PAAC (or in the
case of Imperial, engaging in any business activity other than the holding of
its Investment in Kemwater) and (B) has assets equal to or greater than 5% of
PAAC's total assets determined on a consolidated basis as of the time of
determination.
SECTION 7.2.10. Stock of Subsidiaries. (a) PAAC (i) will not, and will
not permit any of its Wholly-Owned Restricted Subsidiaries (other than a PCIFP
Company and its Subsidiaries)
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to, transfer, convey, sell or otherwise dispose of any Capital Stock of any
such Wholly-Owned Restricted Subsidiary (other than All-Pure and its
Subsidiaries) to any Person (other than PAAC or a Wholly-Owned Restricted
Subsidiary of PAAC), unless (A) such transfer, conveyance, sale or other
disposition is of all the Capital Stock of such Wholly-Owned Restricted
Subsidiary and (B) the Net Proceeds from such transfer, conveyance, sale, lease
or other disposition are applied in accordance with Section 7.2.6, and (ii)
will not permit any such Wholly-Owned Restricted Subsidiary (other than a PCIFP
Company and its Subsidiaries and All-Pure and its Subsidiaries) to issue any of
its Equity Interests (other than, if necessary, Capital Stock constituting
directors' qualifying shares or interests held by directors or shares or
interests required to be held by foreign nationals, to the extent mandated by
applicable law) to any Person other than to PAAC or a Wholly-Owned Restricted
Subsidiary of PAAC.
(b) The Borrower and PAAC (i) will not, and will not permit any
Wholly-Owned Restricted Subsidiary of a PCIFP Company to, transfer, convey,
sell or otherwise dispose of any Capital Stock of any Wholly-Owned Restricted
Subsidiary of a PCIFP Company to any Person (other than such PCIFP Company or a
Wholly-Owned Restricted Subsidiary of such PCIFP Company), and (ii) will not
permit any Wholly-Owned Restricted Subsidiary of any PCIFP Company to issue any
of its Equity Interests (other than, if necessary, Capital Stock constituting
directors' qualifying shares or interests held by directors or shares or
interests required to be held by foreign nationals, to the extent mandated by
applicable law) to any Person other than to the Borrower or such PCIFP Company,
respectively, or any of their respective Wholly-Owned Restricted Subsidiaries.
SECTION 7.2.11. Sale and Leaseback. The Borrower and PAAC will not, and
will not permit any of their respective Restricted Subsidiaries to, enter into
any Sale and Leaseback Transaction unless (i) at the time of the occurrence of
such transaction and after giving effect to such transaction and (x) in the
case of a Sale and Leaseback Transaction which is a Capitalized Lease
Obligation, giving effect to the Indebtedness in respect thereof, and (y) in
the case of any other Sale and Leaseback Transaction, giving effect to the
Attributable Indebtedness in respect thereof, the Borrower, PAAC or such
Restricted Subsidiary could incur $1.00 of additional Indebtedness pursuant to
the first sentence of Section 7.2.1, (ii) at the time of the occurrence of such
transaction, the Borrower, PAAC or such Restricted Subsidiary could incur
Indebtedness secured by a Lien on property in a principal amount equal to or
exceeding the Attributable Indebtedness in respect of such Sale and Leaseback
Transaction pursuant to Section 7.2.2, and (iii) the transfer of assets in such
Sale and Leaseback Transaction is permitted by, and the Borrower or PAAC,
whichever applicable, applies the proceeds of such transaction in compliance,
with Section 7.2.6.
SECTION 7.2.12. Limitation on Applicability of Certain Covenants.
Notwithstanding anything to the contrary herein, the covenants set forth in
Sections 7.2.1, 7.2.2, 7.2.3, 7.2.4, 7.2.6, and 7.2.8 hereof with respect to
PAAC and its Restricted Subsidiaries (other than a PCIFP Company and its
Restricted Subsidiaries) shall not apply to transactions effected pursuant to
and in accordance with the Contingent Payment Agreement and amounts related to
such transactions shall not be required to be included in any calculation
required by any such covenant. Such transactions include (i) any payment made
by PAAC or any of its Restricted Subsidiaries (other than a PCIFP Company and
its Restricted Subsidiaries), (ii) any assets or property transferred by PAAC
or any of its Restricted Subsidiaries (other than a PCIFP Company and its
Restricted Subsidiaries), (iii) the application of any proceeds received by
PAAC or any of its Restricted Subsidiaries (other than a PCIFP Company and its
Restricted Subsidiaries) in connection with
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any transfer of assets or property made by such Person, (iv) any escrow or
segregation of moneys to be paid by PAAC or any of its Restricted Subsidiaries
(other than a PCIFP Company and its Restricted Subsidiaries), (v) any
Investment of such escrowed or segregated moneys by PAAC or any of its
Restricted Subsidiaries (other than a PCIFP Company and its Restricted
Subsidiaries) or any other Investment under the Contingent Payment Agreement,
(vi) any obligation of PAAC or any of its Restricted Subsidiaries (other than a
PCIFP Company and its Restricted Subsidiaries) to make any such payments or to
effect any such escrow or segregation of moneys, (vii) any Indebtedness
incurred by PAAC or any of its Restricted Subsidiaries (other than a PCIFP
Company and its Restricted Subsidiaries) that is non-recourse to the assets of
PAAC, such Restricted Subsidiary or any other such Restricted Subsidiary, other
than the borrower's interest in Basic Investments, Inc., Victory Valley Land
Company, L.P., the Excess Land and/or any other assets or funds held under the
Contingent Payment Agreement, and as to which neither PAAC nor any Restricted
Subsidiary (other than the borrower) provides credit support or is directly or
indirectly liable, or (viii) any Lien incurred by PAAC or any of its Restricted
Subsidiaries (other than a PCIFP Company and its Restricted Subsidiaries) in
connection with Indebtedness described in clause (vii) above that does not
extend to assets of PAAC or any of its Restricted Subsidiaries other than such
Person's interest in Basic Investments, Inc., Victory Valley Land Company,
L.P., the Excess Land and/or any other assets or funds held under the
Contingent Payment Agreement.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1. Listing of Events of Default. Each of the following events
or occurrences described in this Section 8.1 shall constitute an "Event of
Default".
SECTION 8.1.1. Non-Payment of Obligations. (a) The Borrower shall
default in the payment or prepayment of any principal of, or premium with
respect to, any Term Loan when due or (b) any Obligor (including the Borrower)
shall default (and such default shall continue unremedied for a period of five
Business Days) in the payment when due of any interest or fee with respect to
any Term Loan or any other monetary Obligation.
SECTION 8.1.2. Breach of Warranty. Any representation or warranty of the
Borrower, PAAC or any other Obligor made or deemed to be made hereunder or in
any other Loan Document executed by it or any other writing or certificate
(including each Closing Date Certificate) furnished by or on behalf of PCI, the
Borrower, PAAC or any other Obligor to any Agent, the Arranger or any Lender
for the purposes of or in connection with this Agreement or any such other Loan
Document (including any certificates delivered pursuant to Article V) is or
shall be incorrect when made in any material respect.
SECTION 8.1.3. Non-Performance of Certain Covenants and Obligations. Any
Obligor (including the Borrower and PAAC) shall default in the due performance
and observance of any of its obligations under Sections 7.1.7,
7.1.9, 7.2.1, 7.2.2, 7.2.3, 7.2.5, 7.2.6, 7.2.10 or 7.2.11.
SECTION 8.1.4. Non-Performance of Other Covenants and Obligations. Any
Obligor (including the Borrower and PAAC) shall default in the due performance
and observance of any other agreement contained herein or in any other Loan
Document executed by it, and such
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default shall continue unremedied for a period of 30 days after written notice
thereof shall have been given to the Borrower or PAAC by the Administrative
Agent at the direction of the Required Lenders specifying such default and
demanding that it be remedied.
SECTION 8.1.5. Disaffirmation of Obligations. (a) The Borrower or PAAC
shall either deny or disaffirm its obligations under this Agreement or any
other Loan Document or (b) any PAI Guarantor or other Obligor shall either deny
or disaffirm its obligations under the Guaranty or any other Loan Document
executed by it.
SECTION 8.1.6. Effectiveness and Enforceability of Guarantees. Any
Guaranty for any reason ceases to be, or is asserted in writing by any
Guarantor or the Borrower not to be, in full force and effect and enforceable
in accordance with its terms, except to the extent contemplated in such
Guaranty.
SECTION 8.1.7. Default on Other Indebtedness. A default shall occur (i)
in the payment when due (subject to any applicable grace period), whether by
acceleration or otherwise, of any Indebtedness, other than Indebtedness
described in Section 8.1.1, of the Borrower, PAAC or any of their Subsidiaries
having a principal amount in excess of $5,000,000 or (ii) in the performance or
observance of any obligation or condition with respect to such Indebtedness if
the effect of such default is to accelerate the maturity of any such
Indebtedness or such default shall continue unremedied for any applicable
period of time sufficient to permit the holder or holders of such Indebtedness,
or any trustee or agent for such holders, to cause such Indebtedness to become
due and payable prior to its expressed maturity.
SECTION 8.1.8. Judgments. A final judgment or final judgments for the
payment of money are entered by a court or courts of competent jurisdiction
against the Borrower, PAAC or any or their Restricted Subsidiaries and such
judgment or judgments remain undischarged, unbonded or unstayed for a period of
sixty days, provided that the aggregate of all such judgments (other than any
judgment as to which, and only to the extent, a reputable insurance company has
acknowledged coverage of such claim in writing) equals or exceeds $5,000,000.
SECTION 8.1.9. Bankruptcy, Insolvency, etc.
(a) The Borrower, PAAC, any PAI Guarantor or any Restricted
Subsidiary of PAAC pursuant to or within the meaning of any U.S.
Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in
an involuntary case in which it is a debtor,
(iii) consents to the appointment of a Custodian of it or for
all or substantially all of its property,
(iv) makes a general assignment for the benefit of its
creditors,
(v) admits in writing its inability to pay debts as the same
become due;
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(b) a court of competent jurisdiction enters an order or decree
under any U.S. Bankruptcy Law that:
(i) is for relief against the Borrower, PAAC, any PAI Guarantor
or any Restricted Subsidiary of PAAC in an involuntary case in which
it is a debtor,
(ii) appoints a Custodian of the Borrower, PAAC, any PAI
Guarantor or any Restricted Subsidiary of PAAC or for all or
substantially all of their property,
(iii) orders the liquidation of the Borrower, PAAC, or any PAI
Guarantor or any Restricted Subsidiary of PAAC,
and the order or decree remains unstayed and in effect for sixty days; or
(c) PCICC, any other Restricted Subsidiary of PAAC subject to any
Canadian Bankruptcy Law or any PAI Guarantor subject to Canadian
Bankruptcy Law within the meaning of any Canadian Bankruptcy Law:
(i) becomes insolvent or generally does not pay its debts as
such debts become due,
(ii) admits in writing its inability to pay its debts generally
or makes a general assignment for the benefit of creditors,
(iii) files a notice of intention to file a proposal under any
Canadian Bankruptcy Law,
(iv) institutes or has instituted against it any proceeding
seeking:
(A) to adjudicate it a bankrupt or insolvent,
(B) any liquidation, winding-up, reorganization,
arrangement, adjustment, protection, relief or composition of it
or its debts under any Canadian Bankruptcy Law, or
(C) the entry of an order for relief or the appointment of
a receiver, interim receiver, receiver and manager, assignee,
liquidator, sequestrator, trustee or other similar official for
it or for any substantial part of its property,
and in the case of any such proceeding instituted against it (but not
instituted by it), it shall not be actively and diligently contesting
such proceeding in good faith by appropriate legal proceedings or any
of the actions sought in such proceeding (including the entry of an
order for relief against it or the appointment of a receiver,
trustee, custodian or other similar official for it or for any
substantial part of its Property) shall occur, or
(v) takes any corporate action to authorize any of the
foregoing actions.
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SECTION 8.1.10. Impairment of Security, etc. Any of the Security
Documents ceases to give the Collateral Agent a valid and perfected Lien of the
priority required thereby or the rights, powers and privileges purported to be
created thereby (other than in accordance with their respective terms), or any
of the Security Documents is declared null and void, or the Borrower, or any
other Obligor denies any of its obligations under any of the Security Documents
or any Collateral becomes subject to any Lien other than the Liens created or
permitted by the Security Documents or this Agreement.
SECTION 8.2. Action if Bankruptcy, etc. If any Event of Default
described in clause (a), (b) or (c) of Section 8.1.9 shall occur the Term Loan
Commitments (if not theretofore terminated) shall automatically terminate and
the outstanding principal amount of all outstanding Term Loans and all other
Obligations shall automatically be and become immediately due and payable,
without notice or demand.
SECTION 8.3. Action if Other Event of Default. If any Event of Default
(other than an Event of Default described in clause (a), (b) or (c) of Section
8.1.9) shall occur for any reason, whether voluntary or involuntary, and be
continuing, the Administrative Agent, upon the direction of the Required
Lenders, shall by notice to the Borrower declare all or any portion of the
outstanding principal amount of the Term Loans and other Obligations to be due
and payable and/or declare the Term Loan Commitments (if not theretofore
terminated) to be terminated, whereupon the full unpaid amount of such Term
Loans and other Obligations which shall be so declared due and payable shall be
and become immediately due and payable, without further notice, demand or
presentment, and/or, as the case may be, the Term Loan Commitments shall
terminate.
ARTICLE IX
GUARANTY
SECTION 9.1. Guaranty. The Parent Guarantor hereby absolutely,
unconditionally and irrevocably
(a) guarantees the full and punctual payment when due, whether at
stated maturity, by required prepayment, declaration, acceleration, demand
or otherwise, of all Obligations of the Borrower now or hereafter
existing, whether for principal, interest, fees, expenses or otherwise
(including all such amounts which would become due but for the operation
of the automatic stay under Section 362(a) of the United States Bankruptcy
Code, 11 U.S.C. Section 362(a), and the operation of Sections 502(b) and
506(b) of the United States Bankruptcy Code, 11 U.S.C. Section 502(b) and
Section 506(b)), and
(b) indemnifies and holds harmless each Lender Party and each holder
of a Term Note for any and all costs and expenses (including reasonable
attorney's fees and expenses) incurred by such Lender Party or such
holder, as the case may be, in enforcing any rights under the guaranty set
forth in this Article IX.
The guaranty set forth in this Article IX constitutes a guaranty of payment
when due and not of collection, and the Parent Guarantor specifically agrees
that it shall not be necessary or required that any Lender Party or any holder
of any Term Note exercise any right, assert any claim or demand or enforce any
remedy whatsoever against the Borrower or any other Obligor (or any
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other Person) before or as a condition to the obligations of the Parent
Guarantor under the guaranty set forth in this Article IX.
SECTION 9.2. Acceleration of Parent Guaranty. The Parent Guarantor
agrees that, in the event of any Default of the nature set forth in clause (a),
(b) or (c) of Section 8.1.9, and if such event shall occur at a time when any
of the Obligations of the Borrower and each other Obligor may not then be due
and payable, the Parent Guarantor agrees that it will pay to the Administrative
Agent for the account of the Lender Parties forthwith the full amount which
would be payable under the guaranty set forth in this Article IX by the Parent
Guarantor if all such Obligations were then due and payable.
SECTION 9.3. Guaranty Absolute, etc. The guaranty set forth in this
Article IX shall in all respects be a continuing, absolute, unconditional and
irrevocable guaranty of payment, and shall remain in full force and effect
until all Obligations of the Borrower and each other Obligor have been paid in
full in cash, all obligations of the Parent Guarantor under the guaranty set
forth in this Article IX shall have been paid in full in cash and the Term Loan
Commitment shall have terminated. The Parent Guarantor guarantees that the
Obligations of the Borrower will be paid strictly in accordance with the terms
of this Agreement and each other Loan Document under which they arise,
regardless of any law, regulation or order now or hereafter in effect in any
jurisdiction affecting any of such terms or the rights of any Lender Party or
any holder of any Term Note with respect thereto. The liability of the Parent
Guarantor under the guaranty set forth in this Article IX shall be absolute,
unconditional and irrevocable irrespective of:
(a) any lack of validity, legality or enforceability of this
Agreement, any Term Note or any other Loan Document;
(b) the failure of any Lender Party or any holder of any Term Note
(i) to assert any claim or demand or to enforce any right or
remedy against the Borrower, any other Obligor or any other Person
(including any other guarantor (including the Parent Guarantor))
under the provisions of this Agreement, any Term Note, any other Loan
Document or otherwise, or
(ii) to exercise any right or remedy against any other
guarantor (including the Parent Guarantor) of, or collateral
securing, any Obligations of the Borrower;
(c) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Obligations of the Borrower, or any other
extension, compromise or renewal of any Obligation of the Borrower;
(d) any reduction, limitation, impairment or termination of any
Obligations of the Borrower for any reason, including any claim of waiver,
release, surrender, alteration or compromise, and shall not be subject to
(and the Parent Guarantor hereby waives any right to or claim of) any
defense or setoff, counterclaim, recoupment or termination whatsoever by
reason of the invalidity, illegality, nongenuineness, irregularity,
compromise, unenforceability of, or any other event or occurrence
affecting, any Obligations of the Borrower or otherwise;
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(e) any amendment to, rescission, waiver, or other modification of,
or any consent to departure from, any of the terms of this Agreement, any
Term Note or any other Loan Document;
(f) any addition, exchange, release, surrender or non-perfection of
any collateral, or any amendment to or waiver or release or addition of,
or consent to departure from, any other guaranty, held by any Lender Party
or any holder of any Term Note securing any of the Obligations of the
Borrower;
(g) the occurrence of any change in the laws, rules, regulations or
ordinances of any jurisdiction by any present or future action of any
governmental authority or court amending, varying, reducing or otherwise
affecting, or purporting to amend, vary, reduce or otherwise affect, any
of the Obligations and the obligations of any Guarantor;
(h) the application by the Administrative Agent or the Lenders of
all monies at any time and from time to time received from the Borrower,
any Guarantor or any other Person on account of any Obligations owing by
the Borrower or any Guarantor to the Administrative Agent or the Lenders,
in such manner as the Administrative Agent or the Lenders deems best and
the changing of such application in whole or in part and at any time or
from time to time, or any manner of application of Collateral, or proceeds
thereof, to all or any of the Obligations;
(i) any change in the name, business, capital structure or governing
instrument of the Borrower or any Guarantor or any refinancing or
restructuring of any of the Obligations;
(j) the sale of the Borrower's or any Guarantor's business or any
part thereof;
(k) subject to Section 7.2.5, any merger or consolidation,
arrangement or reorganization of the Borrower, any Guarantor, any Person
resulting from the merger or consolidation of the Borrower or any
Guarantor with any other Person or any other successor to such Person or
merged or consolidated Person or any other change in the corporate
existence, structure or ownership of the Borrower or any Guarantor; or
(l) any other circumstance which might otherwise constitute a
defense available to, or a legal or equitable discharge of, the Borrower,
any surety or any guarantor.
SECTION 9.4. Reinstatement, etc. The Parent Guarantor agrees that the
guaranty set forth in this Article IX shall continue to be effective or be
reinstated, as the case may be, if at any time any payment (in whole or in
part) of any of the Obligations is rescinded or must otherwise be restored by
any Lender Party or any holder of any Term Note, upon the insolvency,
bankruptcy or reorganization of the Borrower or otherwise, all as though such
payment had not been made.
SECTION 9.5. Waiver, etc. The Parent Guarantor hereby waives promptness,
diligence, notice of acceptance and, to the extent permitted by law, any other
notice with respect to any of the Obligations of the Borrower and the guaranty
set forth in this Article IX and any requirement that the Administrative Agent,
any other Lender Party or any holder of any Term Note protect, secure, perfect
or insure any security interest or Lien, or any property subject
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thereto, or exhaust any right or take any action against the Borrower, any
other Obligor or any other Person (including any other guarantor) or entity or
any collateral securing the Obligations of the Borrower.
SECTION 9.6. Postponement of Subrogation, etc. The Parent Guarantor
agrees that it will not exercise any rights which it may acquire by way of
rights of subrogation under the guaranty set forth in this Article IX, by any
payment made under the guaranty set forth in this Article IX or otherwise,
until the prior payment in full in cash of all Obligations of the Borrower and
each other Obligor and the termination of the Term Loan Commitment. Any amount
paid to the Parent Guarantor on account of any such subrogation rights prior to
the payment in full in cash of all Obligations of the Borrower and each other
Obligor shall be held in trust for the benefit of the Lender Parties and each
holder of a Term Note and shall immediately be paid to the Administrative Agent
for the benefit of the Lender Parties and each holder of a Term Note and
credited and applied against the Obligations of the Borrower and each other
Obligor, whether matured or unmatured, in accordance with the terms of this
Agreement; provided, however, that if
(a) the Parent Guarantor has made payment to the Lender Parties and
each holder of a Term Note of all or any part of the Obligations of the
Borrower, and
(b) all Obligations of the Borrower and each other Obligor have been
paid in full in cash, and the Term Loan Commitment has been terminated,
each Lender Party and each holder of a Term Note agrees that, at the Parent
Guarantor's request, the Administrative Agent, on behalf of the Lender Parties
and the holders of the Term Notes, will execute and deliver to the Parent
Guarantor appropriate documents (without recourse and without representation or
warranty) necessary to evidence the transfer by subrogation to the Parent
Guarantor of an interest in the Obligations of the Borrower resulting from such
payment by the Parent Guarantor. In furtherance of the foregoing, for so long
as any Obligations or the Term Loan Commitment remain outstanding, the Parent
Guarantor shall refrain from taking any action or commencing any proceeding
against the Borrower (or its successors or assigns, whether in connection with
a bankruptcy proceeding or otherwise) to recover any amounts in the respect of
payments made under the guaranty set forth in this Article IX to any Lender
Party or any holder of a Term Note.
SECTION 9.7. Successors, Transferees and Assigns; Transfers of Term
Notes, etc. The guaranty set forth in this Article IX shall:
(a) be binding upon the Parent Guarantor, and its successors,
transferees and assigns; and
(b) inure to the benefit of and be enforceable by the Administrative
Agent and each other Lender Party.
Without limiting the generality of the foregoing clause (b), any Lender may
assign or otherwise transfer (in whole or in part) any Term Note or Term Loan
held by it to any other Person, and such other Person shall thereupon become
vested with all rights and benefits in respect thereof granted to such Lender
under any Loan Document (including the guaranty set forth in this
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Article IX) or otherwise, subject, however, to any contrary provisions in such
assignment or transfer, and to the provisions of Section 11.11 and Article X.
ARTICLE X
THE AGENTS
SECTION 10.1. Appointment of Agents. Each Lender hereby irrevocably
appoints DLJ as Syndication Agent, Salomon as Documentation Agent and BofA as
its Administrative Agent under and for purposes of this Agreement, the Term
Notes and each other Loan Document. Each Lender authorizes the Administrative
Agent to act on behalf of such Lender under this Agreement, the Term Notes and
each other Loan Document and, in the absence of other written instructions from
the Required Lenders received from time to time by the Administrative Agent
(with respect to which the Administrative Agent agrees that it will comply,
except as otherwise provided in this Section or as otherwise advised by
counsel), to exercise such powers hereunder and thereunder as are specifically
delegated to or required of the Administrative Agent by the terms hereof and
thereof, together with such powers as may be reasonably incidental thereto.
The provisions of this Article X are solely for the benefit of the Agents and
Lenders, and neither the Borrower, PAAC nor any other Obligor shall have any
rights as a third- party beneficiary of any of the provisions hereof other than
with respect to an Agent's resignation. In performing their functions and
duties under this Agreement and each other Loan Document, the Agents shall act
solely as agents of the Lenders and do not assume and shall not be deemed to
have assumed any obligation toward or relationship of agency or trust with or
for the Borrower, PAAC or any other Obligor.
SECTION 10.2. Intercreditor Agreement and Collateral Agent; Power of
Attorney.
(a) Each Agent (in its capacity as an Agent) and each Lender consents and
agrees to all of the terms and provisions of the Intercreditor Agreement and
the other Security Documents, as the same may be amended, supplemented, amended
and restated or otherwise modified from time to time in accordance with the
provisions of the Security Documents and this Agreement, and authorizes and
directs the Collateral Agent to act as mortgagee or secured party with respect
thereto or to act as collateral agent pursuant to the Intercreditor Agreement.
(b) For purposes of constituting security on PCICC's property located in
the Province of Quebec pursuant to the Quebec Mortgage and Security Agreement
as security for the due payment of all obligations of PCICC under each Canadian
Demand Debenture and the performance by PCICC of all of its obligations
contained in the Canadian Demand Debenture, the Administrative Agent and each
Lender hereby irrevocably grants to the Collateral Agent, for the purposes of
holding, on behalf of and for the benefit of the Administrative Agent and the
Lenders, the security constituted by PCICC under the Quebec Mortgage and
Security Agreement, a power of attorney (within the meaning of the Civil Code
of Quebec) of the Administrative Agent and the Lenders. To the extent that any
Person becomes the Administrative Agent or a Lender under this Agreement after
the date hereof, then such Person, by becoming bound by the terms and
conditions of this Agreement, whether by assignment or otherwise, shall be
automatically deemed to have ratified and consented to the irrevocable granting
by the Administrative Agent and Lenders to the Collateral Agent of the power of
attorney constituted hereunder.
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SECTION 10.3. Nature of Duties of the Agents. The Agents shall have no
duties, obligations or responsibilities except those expressly set forth in
this Agreement and each other Loan Document. Neither the Agents nor any of
their officers, directors, employees or agents shall be liable for any action
taken or omitted by it as such hereunder or under each other Loan Document or
in connection herewith or therewith, unless caused by its or their gross
negligence or willful misconduct. The duties of the Agents shall be mechanical
and administrative in nature; the Agents shall not have by reason of this
Agreement or any other Loan Document a fiduciary relationship in respect of any
Lender; and nothing in this Agreement or any other Loan Document, expressed or
implied, is intended to or shall be so construed as to impose upon the Agents
any obligations in respect of this Agreement or any other Loan Document except
as expressly set forth herein or therein. No duty to act, or refrain from
acting, and no other obligation whatsoever, shall be implied on the basis of or
imputed in respect of any right, power or authority granted to any Agent or
shall become effective in the event of any temporary or partial exercise of
such rights, power or authority.
SECTION 10.4. General Immunity. Neither the Agents, the Arranger nor any
of their directors, officers, agents, attorneys or employees shall be liable to
any Lender for any action taken or omitted to be taken by it or them under this
Agreement or any other Loan Document or in connection herewith or therewith
except for its or their own willful misconduct or gross negligence. Without
limiting the generality of the foregoing, the Agents and the Arranger: (i)
shall not be responsible to the Lenders for any recitals, statements,
warranties or representations under this Agreement or any other Loan Document
or any agreement or document relative hereto or thereto or for the financial or
other condition of any Obligor, (ii) shall not be responsible to the Lenders
for the authenticity, accuracy, completeness, value, validity, effectiveness,
due execution, legality, genuineness, enforceability, collectibility or
sufficiency of this Agreement or any other Loan Document or any other
agreements or any assignments, certificates, requests, financial statements,
projections, notices, schedules or opinions of counsel executed and delivered
pursuant hereto or thereto, (iii) shall not be bound to ascertain or inquire as
to the performance or observance of any of the terms, covenants or conditions
of this Agreement or any other Loan Document on the part of Obligors or of any
of the terms of any such agreement by any party hereto or thereto and shall
have no duty to inspect the property (including the books and records) of any
Obligor, (iv) shall have no obligation whatsoever to the Lenders or to any
other Person to assure that the Collateral exists or is owned by the Borrower,
PAAC or another Obligor or is cared for, protected or insured or that the Liens
granted to the Administrative Agent herein or in any other Loan Document or
pursuant hereto or thereto have been properly or sufficiently or lawfully
created, perfected, protected, enforced, realized upon or are entitled to any
particular priority, and (v) shall incur no liability under or in respect of
this Agreement or any other Loan Document or any other document by acting upon
any notice, consent, certificate or other instrument or writing (which may be
by telegram, cable, telex, telecopier or similar form of facsimile
transmission) believed by the Agents to be genuine and signed or sent by the
proper party. The Agents may consult with legal counsel (including counsel for
the Borrower), independent public accountants and other experts selected by the
Agents and shall not be liable for any action taken or omitted to be taken in
good faith in accordance with the advice of such counsel, accountants or
experts.
SECTION 10.5. Successor. Each of the Syndication Agent and the
Documentation Agent may resign as such upon one Business Day's notice to the
Borrower and the Administrative Agent. The Administrative Agent may resign as
such at any time upon at least 30 days' prior notice to the Borrower and all
Lenders. If the Administrative Agent at any time
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shall resign, the Required Lenders may, with the prior consent of the
Borrower (which consent shall not be unreasonably withheld), appoint
another Lender as a successor Administrative Agent which shall thereupon become
the Administrative Agent hereunder. If no successor Administrative Agent shall
have been so appointed by the Required Lenders, and shall have accepted such
appointment, within 20 days after the retiring Administrative Agent's giving
notice of resignation, then the retiring Administrative Agent may, on behalf of
the Lenders, appoint a successor Administrative Agent, which shall be one of
the Lenders or a commercial banking institution organized under the laws of the
United States or a United States branch or agency of a commercial banking
institution, and having a combined capital and surplus of at least
$500,000,000. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative
Agent shall be entitled to receive from the retiring Administrative Agent such
documents of transfer and assignment as such successor Administrative Agent may
reasonably request, and shall thereupon succeed to and become vested with all
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring Administrative Agent's
resignation hereunder as the Administrative Agent, the provisions of (i) this
Article X shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was the Administrative Agent under this Agreement, and
(ii) Section 11.3 and Section 11.4 shall continue to inure to its benefit.
SECTION 10.6. Agents in their Capacity as Lenders. With respect to their
obligation (if any) to lend under this Agreement and each other Loan Document,
the Agents shall have the same rights and powers under this Agreement and each
other Loan Document as any Lender and may exercise the same as though it were
not an Agent. "Lender" or "Lenders" shall, unless the context otherwise
indicates, include each Agent in its capacity as a Lender hereunder. The
Agents, any Lender and their respective affiliates may accept deposits from,
lend money to, and generally engage in any kind of banking or trust business
with the Borrower or any other Obligor, as if it were not an Agent or as if it
or they were not a Lender hereunder and without any duty to account therefor to
the other parties to this Agreement; provided, that the obligations of the
Borrower under such transactions shall not be deemed to be Obligations secured
by any Collateral without the prior written agreement of the Required Lenders.
In furtherance of the foregoing, each Lender acknowledges that, as of the date
hereof, (i) BofA is not a Lender under this Agreement, (ii) BofA is the sole
lender (and the administrative agent) under the Revolving Credit Agreement and
(iii) pursuant to the Revolving Credit Agreement, BofA is the beneficiary of
certain Liens on the inventory, receivables and related general intangibles of
the Borrower and its Subsidiaries.
SECTION 10.7. Actions by Each Agent. (a) Actual Knowledge. Each Agent
may assume that no Event of Default has occurred and is continuing, unless such
Agent has actual knowledge of the Event of Default, has received notice from
the Borrower or the Borrower's independent certified public accountants stating
the nature of the Event of Default, or has received notice from a Lender
stating the nature of the Event of Default and that such Lender considers the
Event of Default to have occurred and to be continuing.
(b) Discretion to Act. Each Agent shall have the right to request
instructions from the Required Lenders by notice to each Lender. If such Agent
shall request instructions from the Required Lenders with respect to any act or
action (including the failure to act) in connection with this Agreement or any
other Loan Document, such Agent shall be entitled to refrain from such act or
taking such action unless and until it shall have received instructions from
the
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Required Lenders, and such Agent shall not incur liability to any Person by
reason of so refraining. Without limiting the foregoing, no Lender shall have
any right of action whatsoever against any Agent as a result of such Agent
acting or refraining from acting hereunder or under any other Loan Document in
accordance with the instructions of the Required Lenders. Each Agent may give
any notice required under Article VIII hereof without the consent of any of the
Lenders unless otherwise directed by the Required Lenders in writing and will,
at the direction of the Required Lenders, give any such notice required under
Article VIII. Except for any obligation expressly set forth in this Agreement
or any other Loan Document, each Agent may, but shall not be required to,
exercise its discretion to act or not act, except that such Agent shall be
required to act or not act upon the instructions of the Required Lenders
(unless all of the Lenders are required to provide such instructions as
provided in Section 10.1) and those instructions shall be binding upon each
Agent and all Lenders; provided, however, that each Agent shall not be required
to act or not act if to do so would expose such Agent to liability or would be
contrary to this Agreement or any other Loan Document or to applicable law.
SECTION 10.8. Right to Indemnity. Each Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Loan
Document or in relation hereto or thereto unless it shall first be indemnified
(upon requesting such indemnification) to its satisfaction by the Lenders
against any and all liability and expense which it may incur by reason of
taking or continuing to take any such action. The Lenders further agree to
indemnify each Agent ratably in accordance with their Percentages for any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind and nature whatsoever which
may be imposed on, incurred by or asserted against such Agent in any way
relating to or arising out of this Agreement or the other Loan Documents or the
transactions contemplated hereby or thereby, or the enforcement of any of the
terms hereof or thereof or of any other documents, and either not indemnified
by the Borrower pursuant to Section 11.4 or with respect to which the Borrower
has failed to fully honor its indemnification obligations under Section 11.4;
provided, however, that no such liability, obligation, loss, damage, penalty,
action, judgment, suit, cost, expense or disbursement results from such Agent's
gross negligence or willful misconduct. Each Lender agrees to reimburse each
Agent in the amount of its pro rata share of any out-of-pocket expenses for
which such Agent is entitled to receive, but has not received, reimbursement
pursuant to this Agreement. The agreements in this Section 10.8 shall survive
the payment and fulfillment of the Obligations and termination of this
Agreement.
SECTION 10.9. Suits to Protect Collateral. Subject to the provisions of
the Intercreditor Agreement, the Administrative Agent, acting at the written
direction of the Required Lenders, shall have power to institute and to
maintain, or direct the Collateral Agent to institute and maintain, such suits
and proceeds as the Administrative Agent may deem expedient to prevent any
impairment of the Collateral by any acts which may be unlawful or in violation
of this Agreement or any other Loan Document, and such suits and proceedings as
the Administrative Agent may deem expedient to preserve or protect its interest
and the interests of the Lenders in the Collateral (including the power to
institute and maintain suits or proceedings to restrain the enforcement of or
compliance with any legislative or other governmental enactment, rule or order
that may be unconstitutional or otherwise invalid if the enforcement of, or
compliance with, such enactment, rule or order would impair the Liens of the
Collateral Agent in the Collateral or be prejudicial to the interests of the
Lender or the Administrative Agent).
SECTION 10.10. Determinations Relating to Collateral. In the event (i)
the Administrative Agent shall receive any written request from the Borrower,
PAAC or any other
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Obligor under this Agreement or any other Loan Document for consent or approval
with respect to any matter relating to any Collateral or the Borrower's, PAAC's
or such Obligor's obligations with respect thereto or (ii) there shall be due
to or from the Administrative Agent under the provisions of any this Agreement
or any other Loan Document, any performance or the delivery of any instrument
or (iii) the Administrative Agent shall become aware of any nonperformance by
the Borrower, PAAC or any other Obligor of any covenant or any breach of any
representation or warranty for the Borrower, PAAC or any other Obligor set
forth in this Agreement or any other Loan Document, then, in each such event,
the Administrative Agent shall be entitled, at the expense of the Borrower and
subject to Section 10.7(b), to hire experts, consultants, agents and attorneys
(including internal counsel) to advise the Administrative Agent on the manner
in which the Administrative Agent should respond to such request or render any
requested performance or response to such nonperformance or breach. The
Administrative Agent shall be fully protected in the taking of any action
recommended or approved by any such expert, consultant, agent or attorney
(including internal counsel) or agreed to by the Required Lenders pursuant to
Section 10.7(b).
SECTION 10.11. Trust Moneys. To the extent Trust Moneys consist of
insurance proceeds or condemnation or other taking awards, any such moneys
which may be used to effect a restoration of the affected Collateral shall be
permitted to be withdrawn by the Borrower and paid by the Collateral Agent in
accordance with the Intercreditor Agreement.
SECTION 10.12. Release of Collateral. Each Lender hereby irrevocably
authorizes the Administrative Agent or the Collateral Agent, as the case may
be, at its option and in its discretion, to release any and all guaranties of
the Obligations and any Lien granted to or held by or in favor of the
Administrative Agent or the Collateral Agent, as the case may be, for the
benefit of the Lenders with respect to any Guarantor or Collateral (i) upon
termination of the Lenders' obligations to make Term Loans and payment and
satisfaction of all Term Loans and all other Obligations and which the
Administrative Agent or the Collateral Agent, as the case may be, has been
notified in writing are then due and payable; (ii) constituting Collateral
being sold or disposed of if the Borrower certifies to the Administrative Agent
and the Collateral Agent pursuant to an Officers' Certificate that the sale or
disposition is made in compliance with the terms of this Agreement and the
other Loan Documents (and, absent any actual knowledge of the Administrative
Agent or the Collateral Agent, as the case may be, to the contrary, the
Administrative Agent or the Collateral Agent, as the case may be, may rely
conclusively on any such certificate, without further inquiry); (iii) as
provided in Section 7.1.8(b); (iv) constituting property in which the Borrower,
PAAC or any other Obligor owned no interest at the time the Lien was granted
and at all times thereafter; or (v) if approved, authorized or ratified in
writing by the Administrative Agent or the Collateral Agent, as the case may
be, at the direction of all Lenders. Upon request by the Administrative Agent
or the Collateral Agent, as the case may be, at any time, each Lender will
confirm in writing the Administrative Agent's or the Collateral Agent's, as the
case may be, authority to release particular types or items of Collateral
pursuant to this Section 10.12.
Section 10.13. Holding of Security. Each Lender agrees (i) with the
other Lenders that it will not, without the prior consent of the other Lenders,
take or obtain any Lien on any property of PCICC to secure the Obligations of
the Borrower hereunder or under any other Loan Document, except for the benefit
of the Collateral Agent, for and on behalf of the Administrative Agent and of
all the Lenders or as may otherwise be required by law; and (ii) that,
notwithstanding the provisions of Section 32 of the Special Corporate Powers
Act (Quebec), the
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Collateral Agent, may as the person holding the power of attorney of the
Administrative Agent and of the Lenders, acquire any title to indebtedness
secured by any hypothec in its favor related to this Agreement or any other
Loan Document.
Section 10.14. Application of Proceeds of Collateral. The Administrative
Agent shall apply the proceeds of any collection of the Collateral payable to
the Administrative Agent for the benefit of it and the Lenders, first, to the
payment of all costs and expenses incurred by the Administrative Agent in
connection with such collection or otherwise in connection with this Agreement
or any other Loan Document, including and together with any amounts then due
and payable to the Administrative Agent (in its capacity as such) hereunder
(including any amount then due and payable to the Administrative Agent pursuant
to its rights to indemnification under Sections 10.5 and 10.8), and, second, to
the payment in full of the Obligations then due and payable to the Lenders
(such payment to be distributed among the Lenders pro rata in accordance with
the amount of such Obligations owed to them on the date of such distribution).
SECTION 10.15. Rights and Remedies to be Exercised by Administrative
Agent Only. In the event any remedy may be exercised with respect to this
Agreement or any other Loan Document or the Collateral, the Administrative
Agent shall pursue remedies designated by the Required Lenders subject to the
proviso set forth in Section 10.7(b). Each Lender agrees that no Lender shall
have any right individually to realize upon the security created by any
Security Document.
SECTION 10.16. Credit Decisions. Each Lender acknowledges that it has,
independently of and without reliance upon each Agent, the Arranger and each
other Lender, and based on such Lender's review of the financial information of
the Borrower and each other Obligor, this Agreement, the other Loan Documents
(the terms and provisions of which being satisfactory to such Lender) and such
other documents, information and investigations as such Lender has deemed
appropriate, made its own credit decision to extend its Term Loan Commitment.
Each Lender also acknowledges that it will, independently of and without
reliance upon each Agent, the Arranger and each other Lender, and based on such
other documents, information and investigations as it shall deem appropriate at
any time, continue to make its own credit decisions as to exercising or not
exercising from time to time any rights and privileges available to it under
this Agreement or any other Loan Document. Except as otherwise expressly
provided for herein, the Agents shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the affairs,
financial condition, litigation, liabilities or business of the Parent, the
Borrower or any other Obligor.
SECTION 10.17. Copies, etc. The Administrative Agent shall give prompt
notice to each Lender of each notice or request required or permitted to be
given to the Administrative Agent by the Borrower pursuant to the terms of this
Agreement (unless concurrently delivered to the Lenders by the Borrower). The
Administrative Agent will distribute to each Lender each document or instrument
received for such Lender's account and copies of all other communications
received by the Administrative Agent from the Borrower for distribution to the
Lenders by the Administrative Agent in accordance with the terms of this
Agreement (except to the extent any such Lender shall have provided written
notice to the Administrative Agent that it is not to receive any such
documents, instruments or communications). In the event such information is so
furnished by any Agent, such Agent shall have no duty to confirm or verify its
accuracy or completeness and shall have no liability whatsoever with respect
thereto.
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SECTION 10.18. The Syndication Agent, the Documentation Agent and the
Administrative Agent. Notwithstanding anything else to the contrary contained
in this Agreement or any other Loan Document, the Agents, in their respective
capacities as such, each in such capacity, shall have no duties or
responsibilities under this Agreement or any other Loan Document nor any
fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or otherwise exist against the Syndication Agent, the Documentation
Agent or the Administrative Agent, as applicable, in such capacity except as
are explicitly set forth herein or in the other Loan Documents.
SECTION 10.19. Agreement to Cooperate. Each Lender agrees to cooperate
to the end that the terms and provisions of this Agreement may be promptly and
fully carried out. The Lenders also agree, from time to time, at the request
of the Agents, to execute and deliver any and all other agreements, documents
or instruments and to take such other actions, all as may be reasonably
necessary or desirable to effectuate the terms, provisions and intent of this
Agreement and the other Loan Documents.
SECTION 10.20. Lenders to Act as Agents. If any Collateral or proceeds
thereof at any time comes into the possession or under the control of any
Lender, such Lender shall hold such Collateral or proceeds thereof as agent for
the joint benefit of the Lenders, and will, upon receipt therefor, deliver such
Collateral or proceeds thereof to the Administrative Agent.
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.1. Waivers, Amendments, etc. The provisions of this Agreement
and of each other Loan Document may from time to time be amended, modified or
waived, if such amendment, modification or waiver is in writing and consented
to by the Borrower and the Required Lenders; provided, however, that no such
amendment, modification or waiver which would:
(a) modify any requirement hereunder that any particular action be
taken by all the Lenders or by the Required Lenders shall be effective
unless consented to by each Lender;
(b) modify this Section 11.1, or clause (a) of Section 11.10, change
the definition of "Required Lenders", increase the Term Loan Commitment
Amount or the Percentage of any Lender, reduce any fees described in
Section 3.3, release any Guarantor from its obligations under any Guaranty
or release a substantial portion of the Collateral (except in each case as
otherwise specifically provided in this Agreement, such Guaranty or
applicable Security Document) or extend the Term Loan Commitment
Termination Date shall be made without the consent of each Lender
adversely affected thereby;
(c) extend the due date for, or reduce the amount of, any scheduled
repayment or prepayment of principal of or interest on or fees payable in
respect of any Term Loan or reduce the principal amount of or rate of
interest on any Term Loan shall be made without the consent of the holder
of the Term Note evidencing such Term Loan; or
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(d) affect adversely the interests, rights or obligations of any
Agent or Arranger (in its capacity as Agent or Arranger), unless consented
to by such Agent or Arranger, as the case may be.
No failure or delay on the part of any Agent, any Lender or the holder of
any Term Note in exercising any power or right under this Agreement or any other
Loan Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such power or right preclude any other or further exercise
thereof or the exercise of any other power or right. No notice to or demand on
the Borrower in any case shall entitle it to any notice or demand in similar or
other circumstances. No waiver or approval by any Agent, any Lender or the
holder of any Term Note under this Agreement or any other Loan Document shall,
except as may be otherwise stated in such waiver or approval, be applicable to
subsequent transactions. No waiver or approval hereunder shall require any
similar or dissimilar waiver or approval thereafter to be granted hereunder.
SECTION 11.2. Notices. All notices and other communications provided to
any party hereto under this Agreement or any other Loan Document shall be in
writing or by facsimile and addressed, delivered or transmitted to such party
at its address or facsimile number set forth in Schedule II hereto or, in the
case of a Lender that becomes a party hereto after the date hereof, as set
forth in the Lender Assignment Agreement pursuant to which such Lender becomes
a Lender hereunder or at such other address or facsimile number as may be
designated by such party in a notice to the other parties. Any notice, if
mailed and properly addressed with postage prepaid or if properly addressed and
sent by pre-paid courier service, shall be deemed given when received; any
notice, if transmitted by facsimile, shall be deemed given when transmitted
(and electronic confirmation of receipt thereof has been received).
SECTION 11.3. Payment of Costs and Expenses. The Borrower agrees to pay
on demand all expenses of each of the Agents (including the fees and
out-of-pocket expenses of counsel to the Agents (including internal counsel)
and of local counsel, if any, who may be retained by counsel to the Agents) in
connection with
(a) the syndication by the Syndication Agent and the Arranger of the
Term Loans, the negotiation, preparation, execution and delivery of this
Agreement and of each other Loan Document, including schedules and
exhibits, and any amendments, waivers, consents, supplements or other
modifications to this Agreement or any other Loan Document as may from
time to time hereafter be required, whether or not the transactions
contemplated hereby are consummated;
(b) the filing, recording, refiling or rerecording of each Mortgage,
each Security Agreement, any Uniform Commercial Code or PPSA financing
statements and each other Security Document relating thereto and all
amendments, supplements and modifications to any thereof and any and all
other documents or instruments of further assurance required to be filed
or recorded or refiled or rerecorded by the terms hereof or of such
Mortgage, Security Agreement or other Security Document; and
(c) the preparation and review of the form of any document or
instrument relevant to this Agreement or any other Loan Document.
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The Borrower further agrees to pay, and to save the Agents and the Lenders
harmless from all liability for, any stamp or other similar taxes which may be
payable in connection with the execution or delivery of this Agreement, the
Term Loans made hereunder or the issuance of the Term Notes or any other Loan
Documents. The Borrower also agrees to reimburse each Agent and each Lender
upon demand for all reasonable out-of-pocket expenses (including attorneys'
fees and legal expenses (including those of internal counsel)) incurred by such
Agent or such Lender in connection with (x) the negotiation of any
restructuring or "work-out", whether or not consummated, of any Obligations,
(y) the enforcement of any Obligations and (z) any litigation relating to the
Obligations, this Agreement or any Loan Document.
SECTION 11.4. Indemnification. In consideration of the execution and
delivery of this Agreement by each Lender and the extension of the Term Loan
Commitments, each of the Borrower and PAAC hereby, to the fullest extent
permitted under applicable law, indemnifies, exonerates and holds each Agent,
the Arranger and each Lender and each of their respective Affiliates, and each
of their respective partners, officers, directors, employees and agents, and
each other Person controlling any of the foregoing within the meaning of either
Section 15 of the Securities Act of 1933, as amended, or Section 20 of the
Securities Exchange Act of 1934, as amended (collectively, the "Indemnified
Parties"), free and harmless from and against any and all actions, causes of
action, suits, losses, costs, liabilities and damages, and expenses incurred in
connection therewith (irrespective of whether any such Indemnified Party is a
party to the action for which indemnification hereunder is sought), including
reasonable attorneys' fees and disbursements (including those of internal
counsel) (collectively, the "Indemnified Liabilities"), incurred by the
Indemnified Parties or any of them as a result of, or arising out of, or
relating to
(a) any transaction financed or to be financed in whole or in part,
directly or indirectly, with the proceeds of any Term Loan;
(b) the entering into and performance of this Agreement and any
other Loan Document by any of the Indemnified Parties (including any
action brought by or on behalf of the Borrower or PAAC as the result of
any determination by the Required Lenders pursuant to Article V not to
fund any Borrowing);
(c) any investigation, litigation or proceeding related to any
acquisition or proposed acquisition by the Borrower, PAAC or any of their
Subsidiaries of all or any portion of the stock or assets of any Person,
whether or not such Agent, such Arranger or such Lender is party thereto;
(d) any investigation, litigation or proceeding related to any
environmental cleanup, audit, compliance or other matter relating to the
protection of the environment or the Release by the Borrower, PAAC or any
of their Subsidiaries of any Hazardous Material;
(e) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or releases from, any real
property owned or operated by the Borrower, PAAC or any of their
Subsidiaries of any Hazardous Material (including any losses, liabilities,
damages, injuries, costs, expenses or claims asserted or arising under any
Environmental Law), regardless of whether caused by, or within the control
of, the Borrower, PAAC or such Subsidiary; or
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(f) with respect to BofA, any action taken by BofA in its capacity as
agent under the Revolving Credit Agreement,
except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the relevant Indemnified Party's
gross negligence or willful misconduct. If and to the extent that the
foregoing undertaking may be unenforceable for any reason, each of the Borrower
and PAAC hereby agrees to make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities which is permissible under
applicable law.
SECTION 11.5. Survival. The obligations of the Borrower and PAAC under
Sections 4.3, 4.4, 4.5, 4.6, Article IX, Sections 11.3 and 11.4, and the
obligations of the Lenders under Section 11.1, shall in each case survive any
termination of this Agreement, the payment in full of all Obligations and the
termination of all Term Loan Commitments. The representations and warranties
made by the Borrower, PAAC and each other Obligor in this Agreement and in each
other Loan Document shall survive the execution and delivery of this Agreement
and each such other Loan Document.
SECTION 11.6. Severability. Any provision of this Agreement or any other
Loan Document which is prohibited or unenforceable in any jurisdiction shall,
as to such provision and such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions of this Agreement or such other Loan Document or affecting the
validity or enforceability of such provision in any other jurisdiction.
SECTION 11.7. Headings. The various headings of this Agreement and of
each other Loan Document are inserted for convenience only and shall not affect
the meaning or interpretation of this Agreement or such other Loan Document or
any provisions hereof or thereof.
SECTION 11.8. Execution in Counterparts, Effectiveness, etc. This
Agreement may be executed by the parties hereto in several counterparts, each
of which shall be deemed to be an original and all of which shall constitute
together but one and the same agreement. This Agreement shall become effective
when counterparts hereof executed on behalf of the Borrower, each Lender and
the Administrative Agent (or notice thereof satisfactory to the Administrative
Agent) shall have been received by the Administrative Agent.
SECTION 11.9. Governing Law; Entire Agreement. THIS AGREEMENT, THE TERM
NOTES AND, EXCEPT TO THE EXTENT OTHERWISE EXPRESSLY PROVIDED THEREIN, EACH
OTHER LOAN DOCUMENT SHALL EACH BE DEEMED TO BE A CONTRACT MADE UNDER AND
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK. This Agreement, the
Term Notes and the other Loan Documents constitute the entire understanding
among the parties hereto with respect to the subject matter hereof and
supersede any prior agreements, written or oral, with respect thereto. Upon
the execution and delivery of this Agreement by the parties hereto, all
obligations and liabilities of the Arranger under or relating or with respect
to the Commitment Letter shall be terminated and of no further force or
effect.
SECTION 11.10. Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that (i) neither the Borrower nor
PAAC may assign or transfer its rights or
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obligations hereunder without the prior written consent of each of the Agents
and all Lenders, and (ii) the rights of sale, assignment and transfer of the
Lenders are subject to Section 11.11.
SECTION 11.11. Sale and Transfer of Term Loans and Term Notes;
Participations in Term Loans and Term Notes. Each Lender may assign, or sell
participations in, its Term Loan and Term Loan Commitment to one or more other
Persons in accordance with this Section 11.11.
SECTION 11.11.1. Assignments. Any Lender (the "Assignor Lender"),
(a) with written notice to the Administrative Agent and the written
consents of the Borrower and the Syndication Agent (which consents shall
not be (i) unreasonably delayed or withheld or (ii) required in the case
of any assignments made by the Syndication Agent or any of its Affiliates
and which consent in the case of the Borrower, shall be deemed to have
been given in the absence of a written notice delivered by the Borrower to
the Administrative Agent, on or before the fifth Business Day after
receipt by the Borrower of such Assignor Lender's request for consent,
stating, in reasonable detail, the reasons why the Borrower proposes to
withhold such consent), may at any time assign and delegate to one or more
commercial banks or other financial institutions (including funds engaged
in the business of investing in loans), and
(b) with notice to the Borrower, the Syndication Agent and the
Administrative Agent, but without the consent of the Borrower or any
Agent, may assign and delegate to any of its Affiliates or to any other
Lender or to any Person whose investment manager or investment advisor is
the investment manager or investment advisor of such Lender
(each Person described in either of the foregoing clauses as being the Person
to whom such assignment and delegation is to be made, being hereinafter
referred to as an "Assignee Lender"), all or any fraction of such Assignor
Lender's total Term Loans and Term Loan Commitment in a minimum aggregate
amount of (i) $1,000,000 or (ii) the then remaining amount of such Lender's
Term Loans and Term Loan Commitment; provided, however, that any such Assignee
Lender will comply, if applicable, with the provisions contained in the last
sentence of Section 4.6 and provided, further, however, that, the Borrower,
each other Obligor and the Agents shall be entitled to continue to deal solely
and directly with such Assignor Lender in connection with the interests so
assigned and delegated to an Assignee Lender until
(i) written notice of such assignment and delegation, together with
payment instructions, addresses and related information with respect to
such Assignee Lender, shall have been given to the Borrower and the Agents
by such Assignor Lender and such Assignee Lender;
(ii) such Assignor Lender and such Assignee Lender shall have
executed and delivered to the Borrower and the Agents a Lender Assignment
Agreement, accepted by the Administrative Agent; and
(iii) the processing fees described below shall have been paid.
From and after the date that the Administrative Agent accepts such Lender
Assignment Agreement, (x) the Assignee Lender thereunder shall be deemed
automatically to have become a party hereto and to the extent that rights and
obligations hereunder have been assigned and
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delegated to such Assignee Lender in connection with such Lender Assignment
Agreement, shall have the rights and obligations of a Lender hereunder and
under the other Loan Documents, and (y) the Assignor Lender, to the extent that
rights and obligations hereunder have been assigned and delegated by it in
connection with such Lender Assignment Agreement, shall be released from its
obligations hereunder and under the other Loan Documents. Within ten Business
Days after its receipt of notice that the Administrative Agent has accepted an
executed Lender Assignment Agreement, the Borrower shall execute and deliver to
the Administrative Agent (for delivery to the relevant Assignee Lender) a new
Term Note evidencing such Assignee Lender's assigned Term Loans and Term Loan
Commitments and, if the Assignor Lender has retained Term Loans and Term Loan
Commitments hereunder, a replacement Term Note in the principal amount of the
Term Loans and Term Loan Commitments retained by the Assignor Lender hereunder
(such Term Note to be in exchange for, but not in payment of, that Term Note
then held by such Assignor Lender). Each such Term Note shall be dated the
date of the predecessor Term Note. The Assignor Lender shall xxxx the
predecessor Term Note "exchanged" and deliver it to the Borrower. Accrued
interest on that part of the predecessor Term Note evidenced by the new Term
Note, and accrued fees, shall be paid as provided in the Lender Assignment
Agreement. Accrued interest on that part of the predecessor Term Note
evidenced by the replacement Term Note shall be paid to the Assignor Lender.
Accrued interest and accrued fees shall be paid at the same time or times
provided in the predecessor Term Note and in this Agreement. Such Assignor
Lender or such Assignee Lender must also pay a processing fee to the
Administrative Agent upon delivery of any Lender Assignment Agreement in the
amount of $2,500, unless such assignment and delegation is by a Lender to its
Affiliate or if such assignment and delegation is by a Lender to a Federal
Reserve Bank, as provided below or is otherwise consented to by the
Administrative Agent. Any attempted assignment and delegation not made in
accordance with this Section 11.11.1 shall be null and void. Nothing contained
in this Section 11.11.1 shall prevent or prohibit any Lender from pledging its
rights (but not its obligations to make Loans) under this Agreement and/or its
Loans and/or its Term Note hereunder to a Federal Reserve Bank in support of
Borrowings made by such Lender from such Federal Reserve Bank.
SECTION 11.11.2. Participations. Any Lender may at any time sell to one
or more commercial banks or other Persons (each such commercial bank and other
Person being herein called a "Participant") participating interests in any of
the Term Loans, Term Loan Commitments or other interests of such Lender
hereunder; provided, however, that
(a) no participation contemplated in this Section shall relieve such
Lender from its Term Loan Commitments or its other obligations hereunder
or under any other Loan Document;
(b) such Lender shall remain solely responsible for the performance
of its Term Loan Commitments and such other obligations;
(c) the Borrower and each other Obligor and the Agents shall
continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement and each of the
other Loan Documents;
(d) no Participant, unless such Participant is an Affiliate of such
Lender, or is itself a Lender, shall be entitled to require such Lender to
take or refrain from taking any action hereunder or under any other Loan
Document, except that such Lender may agree
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with any Participant that such Lender will not, without such Participant's
consent, agree to (i) any reduction in the interest rate or amount of fees
that such Participant is otherwise entitled to, (ii) a decrease in the
principal amount, or an extension of the final Stated Maturity Date, of
any Term Loan in which such Participant has purchased a participating
interest or (iii) a release of all or substantially all of the collateral
security under the Loan Documents or any Guarantor under any Guaranty, in
each case except as otherwise specifically provided in a Loan Document;
and
(e) the Borrower shall not be required to pay any amount under
Section 4.6, that is greater than the amount which it would have been
required to pay had no participating interest been sold.
The Borrower acknowledges and agrees that each Participant, for purposes of
Sections 4.3, 4.4, 4.5, 4.6, 4.8, 4.9, 11.3 and 11.4, shall be considered a
Lender.
SECTION 11.12. Other Transactions. Nothing contained herein shall
preclude any Agent or any other Lender from engaging in any transaction, in
addition to those contemplated by this Agreement or any other Loan Document,
with the Borrower, PAAC or any of their Affiliates in which the Borrower, PAAC
or such Affiliate is not restricted hereby from engaging with any other Person.
SECTION 11.13. Forum Selection and Consent to Jurisdiction. ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE AGENTS, THE
LENDERS, THE BORROWER OR PAAC RELATING THERETO SHALL BE BROUGHT AND MAINTAINED
EXCLUSIVELY (TO THE EXTENT PERMITTED UNDER APPLICABLE LAW) IN THE COURTS OF THE
STATE OF NEW YORK, NEW YORK COUNTY, OR IN THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
ADMINISTRATIVE AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. EACH OF THE BORROWER AND PAAC
HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF
THE STATE OF NEW YORK, NEW YORK COUNTY, AND OF THE UNITED STATES DISTRICT
COURT FOR THE SOUTHERN DISTRICT OF NEW YORK FOR THE PURPOSE OF ANY SUCH
LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY
JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION. EACH OF THE
BORROWER AND PAAC IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED
MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF
NEW YORK. EACH OF THE BORROWER AND PAAC HEREBY EXPRESSLY AND IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE
OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN
ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS
BEEN BROUGHT IN AN
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INCONVENIENT FORUM. TO THE EXTENT THAT THE BORROWER OR PAAC HAS OR
HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OF FROM ANY
LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, THE BORROWER OR PAAC, WHICHEVER APPLICABLE, HEREBY IRREVOCABLY WAIVES
(TO THE EXTENT PERMITTED UNDER APPLICABLE LAW) SUCH IMMUNITY IN RESPECT OF ITS
OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
SECTION 11.14. Waiver of Jury Trial. THE AGENTS, THE LENDERS, THE
BORROWER AND PAAC HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY
RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH, THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE AGENTS, THE LENDERS OR THE BORROWER
RELATING THERETO. EACH OF THE BORROWER AND PAAC ACKNOWLEDGES AND AGREES THAT
IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH
OTHER PROVISION OF EACH OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT
THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENTS AND THE LENDERS ENTERING
INTO THIS AGREEMENT AND EACH SUCH OTHER LOAN DOCUMENT.
SECTION 11.15. Judgment Currency. (a) If, for purposes of obtaining
judgment in any court, it is necessary to convert any sum due or owing under
any Loan Document to the Administrative Agent or any one or more of the Lenders
in any currency (the "Original Currency") into another currency (the "Other
Currency"), the parties hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be that at which, in
accordance with normal banking procedures, the Administrative Agent could
purchase the Original Currency with the Other Currency on the Business Day
preceding that on which the final judgment is granted.
(b) The Obligations of the Borrower in respect of any sum due in the
Original Currency from it to the Administrative Agent or any one or more of the
Lenders under any of the Loan Documents shall, notwithstanding any judgment in
any Other Currency, be discharged only to the extent that on the Business Day
following receipt by the Administrative Agent of any sum adjudged to be so due
or owing in such Other Currency, the Administrative Agent may in accordance
with normal banking procedures purchase the Original Currency with such Other
Currency. If the amount of the Original Currency so purchased is less than the
sum originally due or owing to the Administrative Agent or any one or more of
the Lenders in the Original Currency, the Borrower shall, as a separate
obligation and notwithstanding any such judgment, indemnify the Administrative
Agent or such Lender(s) against such loss, and if the amount of the Original
Currency so purchased exceeds the sum originally due or owing to the
Administrative Agent or such Lender(s) in the Original Currency, the
Administrative Agent or such Lender(s) shall remit such excess to the Borrower.
95
103
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
96
104
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
PIONEER AMERICAS, INC.
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------
Title: Vice President
PIONEER AMERICAS ACQUISITION CORP.
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------
Title: Vice President
DLJ CAPITAL FUNDING, INC., as the
Syndication Agent and as Lender
By: /s/ Xxxxxx Xxxxxxxx
-------------------------------------
Title: Managing Director
SALOMON BROTHERS HOLDING
COMPANY INC, as the Documentation
Agent and as Lender
By: /s/ Xxxxxxxx Xxxxxx
-------------------------------------
Title: Vice President
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS
ASSOCIATION,
as the Administrative Agent
By: /s/ Xxxxx Xxxxxxxx
-------------------------------------
Title: Vice President
000
XXXXXX XXXXXX TRUST COMPANY OF
NEW YORK, as the Collateral Agent
By: /s/ Xxxxxxxx Xxxxxxx
-------------------------------------
Title: Assistant Vice President
106
SCHEDULE I
DISCLOSURE SCHEDULE
ITEM 6.7 Insurance.
ITEM 6.8 Litigation.
Description of Proceedings Action or Claim Sought
-------------------------- ----------------------
ITEM 6.10 Subsidiaries.
ITEM 6.11 Partnerships; Joint Ventures.
ITEM 6.13 Intellectual Property.
ITEM 6.15 Contracts and Labor Matters.
ITEM 6.16 Pension and Welfare Plans.
ITEM 7.2.1 (c) Existing Indebtedness.
ITEM 7.2.2 (a) Existing Liens.
ITEM 7.2.3 Existing Investments.
ITEM 7.2.8 Existing Affiliate Agreements.
107
SCHEDULE II to
Credit Agreement
PERCENTAGES
-----------
TERM LOAN
DLJ Capital Funding, Inc. 60%
Salomon Brothers
Holding Company Inc 40%
ADMINISTRATIVE INFORMATION
--------------------------
Notice Information
------------------
Pioneer Americas, Inc. 000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
Contact: Vice President, Chief Financial
Officer
Fax: 000-000-0000
Pioneer Americas Acquisition
Corp. 000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
Contact: Vice President, Chief Financial
Officer
Fax: 000-000-0000
DLJ Capital Funding, Inc.,
as Syndication Agent 000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Contact: Xxxxxx X'Xxxxxxxx
Fax: 000-000-0000
Salomon Brothers Holding
Company Inc,
as Documentation Agent Xxxxx Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Contact: Xxxxxx Xxxxxxx
Fax: 000-000-0000
000
Xxxx xx Xxxxxxx National
Trust and Savings Association,
as Administrative Agent 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Contact: Xxxxxxx X. Xxxxxx
Fax: 000-000-0000
United States Trust Company of
New York,
as Collateral Agent 000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Contact: Xxxxxxxx Xxxxxxx
Fax: 000-000-0000
Lenders' Domestic and LIBOR Offices
-----------------------------------
DLJ Capital Funding, Inc. 000 Xxxxxxxxxx Xxxx.
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Contact: Xx Xxxxxxxx
Fax: 000-000-0000
Salomon Brothers Holding
Company Inc Seven Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Contact: Xxxxxx Xxxxxxx
Fax: 000-000-0000
